Thursday, December 31, 2009

Wednesday, December 30, 2009

Free Kindle OK!

Some people are all in a twist over the news that most of Kindle's top "sellers" are actually free--nine of the top 10, 64 of the top 100. But is this surprising? Seems to me it is just what you would expect. If a clerk leaves a bowl of free candy next to the check-out counter, it will be free before the clerk goes on her next break. The only difference with the Kindle is that the candy is probably more expensive--recall that the marginal cost on all these books is effectively zero. Granted that the sunk cost has to be something > zero, but I bet not much, and in any event, I bet Amazon ain't payin' it.

Anecdote as data: I scroll the free stuff from time to time, have added a few, have knocked a few off for space reasons (all free, what's the big deal?). I've also bought about 70 books over the year since I got it. I don't know how many I would have bought in paper but I know it is not 70, so Amazon has squeezed something out of me. I suspect that maybe none of my 70 is in Amazon's top 100, but I do suspect my dollars are just as green as anyone's else.

Afterthought: have you any idea how handy it is to have a Complete Shakespeare on your Kindle? Never at loss to complete a quotation. Or for solace in a dark moment. Not very well edited, but good enough, and hey, it's free.

Engineer Terrorists

John flags me to the Slate piece this morning, asking why (and whether) so many terrorists are engineers. The answer to "whether" is apparently "yes;" the anecdotes hold up to more formal scrutiny. The answer to "why" remains, necessarily more speculative, and Slate feels free to speculate away (they do cite evidence that engineers are "more conservative and religious" than other scientists, but this only begs the question).

I will add two cents. I'm not even remotely an engineer myself, but I went to law school with quite a few and a find myself teaching quite a few in the law school. In this (skewed?) sample, I see a lot of people who have worked hard to develop a skill and then find themselves faced with the prospect of spending their lives in not-very-interesting jobs with lots of cubicles and a fairly low salary ceiling--that, at least, is the sort of thing that drives them to law school. A corollary is that they often find themselves (as they see it) ruled by idiots--find themselves taking orders from people they see as stupider than they are. Think Dilbert.

They may well be right in this view. Think Dilbert again. Of course it is equally possible that these bosses have skills that the engineers don't have and which to the engineers are therefore invisible.

Afterthought: Ignoto tells me I need to elaborate on that point about engineers in law school. Fair enough. My experience is that the engineers often do well, but often not as well as they expected, or think they deserve. My first dean told me that this is because engineers are not good at what lawyers need to learn how to do, and that is to cope with ambiguity. Might be. Of course a question would be whether we do in fact teach law students to cope with ambiguity.

Tuesday, December 29, 2009

Anecdote as Data: the Hairdresser's Tale

The lady who does Mrs. B's hair is outraged at the health care mandate. She says she'll pay the tax. Narrowly speaking, she might be right: paying the tax probably will be cheaper for her than getting health care would be.

She's in some way typical of an definable demographic. She's about 30, single and unattached, no insurance (and apparently doesn't want it). She's perhaps unusual in that she seems to follow politics with a lot of care, and says she votes.

And as I say, she's angry. Yes, yes, I know, wonks can tell her from now until doomsday that comprehensive care doesn't work without mandates,. They can even try to tell her that it is "only fair" that the young and healthy get in the pool (though is it? Do we really need any more transfers of wealth from the young to the old?).

Obviously, her eyes glaze over. My guess is that there are an awful lot of people in her cohort with the same attitude. The Democrats had better hope that most of them (unlike the hairdresser) just don't bother vote.

Monday, December 28, 2009

Why It Is So Hard to Make Sense out of Housing: One Reason

One of he reasons it is so hard to make sense out of the housing bubble: "housing," so-called, is so many different issues. Consider:
  • The campaign, so popular with Democrats and Republicans alike, to extend home ownership to non-owners.
  • Houses as piggy banks, or ATM machines--the second mortgage equity access program.
  • The slow and painful--and sometimes rapid and painful--decline of once-great cities.
  • The campaign of looting, undertaken by organized marauders who succeeded in transferring loan proceeds to themselves by systematic fraud.
  • The clueless and luckless "investors" from Nowheresville who stumped up hard cash hoping to share in the transformation of a former alligator farm into the Next Great Sunbelt metropolis.
Behind all these, we have:
  • The revolution in finance, including the creation of new devices to "rationalize" (he he) the mortgage market.
  • The tsunami of new capital, seeking protection against the dismal returns and the seemingly astronomic risks of Asian investing.
  • The grey monster, still porrly defined and worse understood, that we choose, for lack of a better name, to characterize as "the bubble."
Bullet points inspired (although not supplied) by the best thing I've read on housing policy in years. That would be Alyssa Katz' Our Lot. The subtitle is "How Real Estate Came to Own Us," but that's way too facile for a presentation fo subtle and nuanced. Katz covers a daunting range of material: the early community action groups in the 70s; the invention of mortgate securitization in the 80s; the full-court press for expanded ownership in the 90s, and that unspeakable phase when everything when kablooie in the naughts. And she brings off the trick almost unheard of in this kind of semi-journalism: she couples a gift for personalized narrative with a commendable skill at sketching the technical background.

There is nothing here by way of an agenda for reform. And she presents it all with an air of hip detachment which suggests that she knows that life is bound to be like this under capitalism, and we can't expect much to change until the revolution or the next ice age. Yet the details of her own message deny the larger aroma: she makes it clear that the story is far too rich and nuanced for for detachment of any sort, hip or otherwise.

One more substantial drawback: she ends with a chapter, overlong and not nearly so well organized, on New York City, specifically the New York of rent control and condo conversions. As a topic in an overview of this sort, New York is certainly fair game. But the trouble is that she's too close to it: she's been burned by rent control and burned by the market, and she still doesn't have a good fix on exactly what went wrong and how.

But that's not much of a problem. It's the end of the book; you can skip it if you like. For the rest, as a means to get your mind around real estate issues, I can't think of a better place to start.

Obama and the Costs of Centrism

  "Come, let us reason together," said Lyndon Johnson (quoting, I believe, the prophet Isaiah). And so he did, although when Lyndon Johnson reasoned, you could usually hear the crushing of a few bones.

Barack Obama didn't use the Johnson phrase, but he did make it clear that he wanted to be the conciliatory President, the the centrist, the man willing to work with his worst enemy.

I suspect Obama himself is surprised and dismayed at how utterly he has failed in his campaign for centrist cooperation. I feel for him, but I for whatever it may be worth, I offer an insight. That is--obviously the Republicans have decided they have to destroy this guy, just as they tried so hard to destroy Bill Clinton. Since Obama doesn't seem to have a zipper problem, they have to look for something else.

Under this light, it is perhaps natural that they would plunge in for the kill so directly on what he seems to value most: his desire for a kind of post-partisanship. Perhaps this helps to show his weakness; perhaps it pulls the keystone out of a grand architecture. Or perhaps they are doing it because trying to destroy Democrats is just fun (I love the smoke of filibusters in the morning!).

But whatever the particular goal, perhaps a primary reason for the stonewall strategy ihe wants cooperation so much. It's an unprovable counterfactual, but could it be tht things might have gone better--even more collegially--if he had simply stuck his thumb in their eye?

[There might also be a larger strategical insight here, and if true, I hope it's not too late. Specifically, one thing you do as a good negotiator is to offer something you really don't care about very much as if you cared about it absolutely. Then you let your enemies wear themselves out fighting aginst something for which you really don't give a damn. I really don't think that was what Obama was doing with the collegiality ploy, but I kind of wish it had been.]

The Toothbrush Theorem and the Debt Bubble

I just spotted a finance application to a general principle. The principle itself is well enough known, although so far as I know, it does not have a name. So, call it "the toothbrush theorem." Allow me to explain.

Start with a particular example. In a Pat Barker novel (I forget which) there is a teen-ager who hates her stepfather. Every morning, she takes his toothbrush and runs it around the inside of the toilet bowl rim. I told this story to Mrs. Buce and she instantly responded: that guy must have the best immune system in the world.

Exactly so. The toothbrush theorem: disease, germs, viri, have a habit of building up resistance in odd or unexpected places.

Here's another example: I grew up in the era before polio. My mother lived in dread that I would get the disease. She did everything she could to protect me against it. In particular, she certainly wasn't going to let me swim in the river, which was not that far downstream from a sewer. In fact I did not get polio, but a friend of mine did, and was permanently paralyzed, and eventually killed himself.

All this was done with the best of intentions. But we know now that she had it backwards: in retrospect, we know that polio struck the middle class, those children with protection. The protected ones were those kids out cavorting downstream from the sewer.

And a third example. Go back to, say, the middle ages. Nobody--not even the king--was rich, but the masses lived in unspeakable privation. This was true everywhere, but it appears that the masses in Japan may have suffered even more than the Europeans. Why so? A plausible answer is that the Japanese were too clean. So they lived longer, and there were too many, fighting for too little. The Europeans, by contrast, rounded out their privation with squalor and filfth. So many died of disease. There was this much of a comfort: at least there werent' so many survivors to compete for the limited resources [recall in particular the horror of the Black Death in 1348: almost every student agrees that the masses who survived the great plague lived rather better after than they did before, because there were fewer of them.

So now the finance case. I'm reading Henry Kaufman's The Road to Financial Reformation. He is discussing the 1980s, a great golden age of debt: the growth of debt, he declares, exceeded the nominal growth of the gross national product. And did so without interruption: unlike almost any other boom time, there were no financial crises or panics. Granted, there was the great selloff of 1987, but in retrospect, this was a blip. There was not one of those fractures that induce large debt liquidations. So the very success of this golden age drove debt virtually out of control. The toothbrush theorem lives.

Another Quarter Heard From

Just a couple of days ago, I was venting my queasiness over the idea that Peggy Noonan has nice things to say about Barack Obama. Today it is Ross Douthat--the New York Times' new "Mr. Conservative," now that David Brooks has proved too unreliable and Bill Kristol too, well, Kristolline. Douthat's charitable view of the President is not quite as wholehearted as Noonan actually, but a lot kinder than what the President has been hearing from, well, almost anybody else.

I concede that Douthat's influence on any real voter is likely absolute zero (while Noonan's is only vanishingly small). But that may be part of the problem: all of Obama's striving for decency, for constructive dialog--they cost him almost all of his potential friends and gain him two of the most irrelevant people in the vote-counting universe.

I mean-- do we really want to take political guidance from some guy who thinks that masturbation is a vice?

I'm Still at Large

Get this, folks: it is illegal at all times to smoke inside a motor vehicle when a person younger than 18 is with you.

That's California law. You knew? I did not. And so it cost me a point on the written exam for my driver's license renewal. More than three wrong and I would have had to take it again. But I got only three wrong, so I scraped through this P/NP course with a P.

Of my two others wrongs, one was just sloppiness. I read "cell phone without a hands-free device" and I checked "never." Had I read more closely, I would have seen that another choice was "when making a call for emergency assistance," which is obviously righter.

And finally--where do you look when you are backing out of a parking space? The correct answer is "over your right shoulder." I rejected that. I also rejected "at your rearview mirror." Instead I checked "at your side mirrors," but it seems to me that you really want to do "all of the above," plus look "over your left shoulder," as available. Sadly, "all of the above," was not an option. So, a poorly formulated question; but I had seen it before on a practice quiz, so it was my own fault it didn't get it right.

Thanks to the magic of cataract surgery, I also squeaked through the eye test without glasses, but it occurred to me: in the age of contact lenses, isn't that a joke? For all he knew, I was wearing my contacts this morning (but I wasn't) and would never wear them again--until, perhaps, my next eye test.

It does seem to that this test has gotten harder over the years. No, I know what you're thinking, but I don't think it is just me: I downloaded the manual which seems a lot thicker than it used to be, and I took a lot of practice quizzes, with a lot of lot of picky rules (not all of which, apparently, I mastered).

And that stuff about driving with minors--sheesh, of course it is a dumb idea to smoke with kids in the car. It's a dumb idea to smoke ever. I quit a long time ago (come to think of it, 50 years ago next week. But a motor vehicle law? Oh, give me a break. Stuff like that degrades law enforcement, and degrades the law.

Sunday, December 27, 2009

Chuck S. Is Not Impressed

Chuck S. commenting at Naked Capitalism, offers a metacritique of the Senate bill:
Top 10 Reasons to Kill Senate Health Care Bill

1. Forces you to pay up to 8% of your income to private insurance corporations — whether you want to or not.

2. If you refuse to buy the insurance, you’ll have to pay penalties of up to 2% of your annual income to the IRS.

3. Many will be forced to buy poor-quality insurance they can’t afford to use, with $11,900 in annual out-of-pocket expenses over and above their annual premiums.

4. Massive restriction on a woman’s right to choose, designed to trigger a challenge to Roe v. Wade in the Supreme Court.

5. Paid for by taxes on the middle class insurance plan you have right now through your employer, causing them to cut back benefits and increase co-pays.

6. Many of the taxes to pay for the bill start now, but most Americans won’t see any benefits — like an end to discrimination against those with preexisting conditions — until 2014 when the program begins.

7. Allows insurance companies to charge people who are older 300% more than others.

8. Grants monopolies to drug companies that will keep generic versions of expensive biotech drugs from ever coming to market.

9. No re-importation of prescription drugs, which would save consumers $100 billion over 10 years.

10. The cost of medical care will continue to rise, and insurance premiums for a family of four will rise an average of $1,000 a year — meaning in 10 years, your family’s insurance premium will be $10,000 more annually than it is right now.

Yves Smith, responding, thinks it's worse than that.

Econ v. Sociology: Good Question

Herb Gintis doesn't soft-pedal his criticism, but he still wants to bridge the gap between economics and sociology:
[Hans] Joas and [Jens] Beckert's treatment of action theory is a showcase in misunderstanding the rational actor model, but in a way which is shared by the overwhelming majority of sociologists. Joas and Beckert begin by characterizing the rational actor model as claiming that "actors' decisions can be understood from their motivation to optimize their utility." (p.269) Even the most elementary exposition of the model, by contrast, stresses that if individuals have consistent preferences, we can represent their behavior as maximization, but this is not their "motivation" any more than the fact that we can represent the motion of light waves by minimizing a Hamiltonian means that "light waves want to travel minimal paths." So, is simply absurd to think that economists believe it is rational to be "motivated to optimize." Joas and Beckert then assert that "the debate on action in sociology tends to focus primarily on rational choice theory on the one hand and on normative theories of action on the other... The competition between economics and sociology is largely founded on radically opposed action theories. The most influential sociological alternative to rational actor theory has been the normative model of action." (p. 270-271) Now, I do not want to deny that this is the case, but I do want to deny, categorically, that there is any conflict between rational action and normative action. There is nothing in the rational actor model that precludes normative elements in the actor's preference function. Nor is there anything in the normative model that precludes individuals from making welfare-improving trade-offs between normative principles (e.g., fairness, honesty, trustworthiness) and self-regarding concerns (material goods and services, leisure, prestige). Indeed, a raft of experiments in behavioral game theory exhibit the consonance of self-regarding interests, other-regarding interests, and character virtues in the preferences of rational agents. The failure of sociologists to understand this point is probably the chief reason core sociological theory has never had a chance to develop (economics has its own problems, of course, but that is a matter better discussed elsewhere).

Siegwart Lindenberg's contribution, "Social Rationality versus Rational Egoism," shows exactly how the economist's rational actor model can be enriched to serve sociological purposes without abandoning the analytical clarity and power of economic theory. I tend to stress that the rational actor model requires no more that preference consistency, and refer for support to the success of the model in game-theoretic models of animal behavior. Now, animals are hardly rational according to most meanings of the term "rational," but they do tend to satisfy preference consistency, and hence their strategic interactions can be cogently modeled as rational action---even if the creatures are pond scum or dung beetles. However, sociologists demand a richer concept of rationality, and Lindenberg offers an expanded concept of rationality, one that conserves yet goes beyond what economists care about. He argues of human individuals that (a) they are resourceful and goal-motivated; (b) they are constrained and confronted with scarcity of time, energy, and resources; (c) they form expectations and learn; (d) they differentially value distinct states of the world; (e) they are motivated to achieve; (f) in novel situations, they search for the proper frame for the event in their reservoir of know event types. (p. 636) Of course, these characteristics are plausible and in no way conflict with the rational actor model.

So, why then does the chasm between sociology and economics persist? Good question.
From Gintis' Amazon review of Jonathan H. Turner's Handbook of Sociological Theory (link).

Al Hunt on The Economic Team

Al Hunt at Bloomberg looks at the Obama economic team and sees some of the features of a gaggle of unherded cats. He might be right, although like Bruce Bartlett, I am willing to wait and see what the budget looks like next month. In any case, there is a useful background point here: presidents are judged, and rightly so, on their ability to orchestrate staff. And the more thoroughbreds, the more difficult the organization.

So Doris Kearns Goodwin never ceases to tell us about Lincoln and his (boy am I tired of this phrase) Team of Rivals. Goodwin's is not a bad point although I think it may be vastly overblown for promotional purposes, insofar as there really wasn't that much for most of the cabinet to do during the Civil War except to stay the hell out of the President's way. A more interesting example might be Herbert Asquith, Lord Asquith, prime minister of Great Britain from 1908 until he was shuffled aside in 1916. Asquith presided over a cabinet with talents like Winston Churchill and Lloyd George--and others of perhaps equal or greater ability, if not to prickly and self-possessed. Asquith himself sometimes seemed to do nothing at all--but that may be precisely the point, as his ability to command such a motley army may be the real testimony to his success.

A case that has long fascinated me is Dwight Eisenhower, who gets pretty good marks as a president, though he led a cabinet peopled by primitives like George M. Humphrey, Ezra Taft Benson and "Engine Charlie" Wilson, and the gasbag di tutti gasbags, John Foster Dulles. Surprisingly little blame for his underlings adheres to Eisenhower himself, except for the suggestion that it was they, not he, who were the real culprits. This smacks of "If only the Tsar knew!"--a deft achievement at fobbing blame off on others while keeping the credit for one's self.

Other cases are more complicated. Nobody was freer than Ronald Reagan at ceding control to his underlings, yet he seems to have done it in an organized manner. When his deputy was the ham-handed Don Regan, he found himself in trouble; with the deft James Baker, he rode high. Richard Nixon staked a lot on his relationship with Henry Kissinger--or was it the other way around? There's a certain amount of bleak amusement in the degree to which others, particularly Secretary of State William Rogers, found themselves frozen out in the process.

Churchill as an underling is one story; Churchill in power is quite another. Yes, he dominated the execution of the war--but he left virtually all of the running of the country to his cabinet-mates from the labour party, under Clement Atlee. And a splendid job of it they did, too, organized, cooperative and efficient, proving that they could govern well enough that they shunted Churchill aside in 1945 (somewhat the same way, perhaps, that Lloyd George shunted Asquith aside in 1916).

The most dispiriting modern example is perhaps (he keeps coming up) Jimmy Carter, who never seemed to be able to get control of the rivarly of his secretary of state, Cyrus Vance, and his national security adviser, Zbigniew Brzezinski. That's certainly not an example Obama wants to emulate.

From the Annals of Privatization: Bail

Here's a New York Times reporter who seems not to have spent much time hanging around the courthouse:
Bail, of course, is nominally the province of the government, but as with certain toll roads and various crucial functions of the military, it has lately seen a wave of privatization.
Link. I'll accept that as true, of course, if the writer will amend it to say:
Bail, of course, has been a private for-profit enterprise since day one.
If he still doubts it, he could look further down ion his own story, where he quotes the English Habeas Corpus Act of 1679:
A Magistrate shall discharge prisoners from their Imprisonment taking their Recognizance, with one or more Surety or Sureties, in any Sum according to the Magistrate’s discretion.
Own recognizance is what explains all those forlorn little neon signs in the shabby storefronts around the jasil, where you can get 24-hour service (with one or more Surety or Sureties) from the bail bondsman. If he still doubts it, he should spend the next six weeks handcuffed to Robert DeNiro, as did Charles Grodin in my favorite chase movie:

Here's a a good history of the bail issue in America, with appropriate background.

Saturday, December 26, 2009

Appreciation: Two Quickies

Brief notes about two books about which I have not much to say, but which I enjoyed too much to ignore:
  • William Faulkner, As I Lay Dying. A few weeks ago I said I had reread Thomas Hardy's Jude the Obscure and found it not as good as I remembered. Rereading Faulkner on the misbegotten Bundrens and their misguided quest to put Addie under the ground, I take it as much better than I remembered. A kind of a parlor trick, sure, but so dense and textured you find the characters leaping right off the page--not that you are always glad to see them. I'm left with only one question: is there a difference between a buzzard and a vulture?
  • Mori Ogai, The Wild Goose. Per the introduction, Ogai was highly regarded in Meiji Japan, not least for this slender tale published first published serially in 1911-13 (sic, two years? But it is only 166 pages). It's a deft and delicate recitation of what could have been a much thicker novel--remarkable how much Ogai can convey by indirection and economy. Apparently in its own time it counted as a "recreation" of an earlier world, specifically the 1870s and 1880s. One oddity: the plot seems to echo Chekhov's Seagull almost beyond the play. Did Ogai (who was, I gather, well versed in European culture) know Chekhov? Did he know the play?
Afterthought: I guess the common theme here is that they are both short. I actually tend to prefer long novels over short ones: I love one of those you can just dive into and wallow around in --why I still stand by Middlemarch and Charterhouse of Parma and, yes, War and Peace. But the thing about both of these two is that they seem to create something like a whole world in a apan of just a few pages.

Oh, and as to buzzards and vultures: apparently the answer is yes, sort of.

Life Before Google: Community Activists in Chicago

Back when Barack Obama was still in middle school, community activists in Chicago were already at work trying to rev up the troops for housing reform. After a bit of modest local success, they decided to go national.
It wasn't long before West Side Coalition interns headed out to O'Hare International Airport, the one [place where they could find phone books for every big city in the country. They would look for listings that sounded like they could be for community organizations, and back at they office they called those groups, asking them to come to a big conference ...
Such was life before Google. That's Alyssa Katz in Our Lot, a history of thre modern mortgage revolution (a splendid book about which I intend to say more once I've finished it).

Update: Well, yes, I should have specified. The date appears to be 1975.

Obama: Says Who?

I have to admit it: I feel more than a little uncomfortable reading (seemingly) kind words about Barack Obama from--ready for it?--Peggy Noonan. Okay, I'm sure she'd be just as uncomfortable to find herself keeping company with me (well he-llo, pretty lady!). But although I still count myself an Obamaphile, I think I still find myself more at home with straightforward critics like Glenn Greenwald or Paul Krugman than I do with the lady who gave us "read my lips" and "a thousand points of light."

It's really not just stuffiness or snobbery. The truth is, I just keep looking for the catch, nervously watching my backside to make sure she doesn't put a knife in it. So needless to say I find myself reassured when I get to the end and find that what she really likes about Barack Obama is how much he reminds her of--ready for it?--Ronald Reagan:
I end with a story told to me by an old Reagan hand who, with another former Reagan administration official, was being given a private tour of the White House by Michelle Obama. This was last summer. Mrs. Obama led the two through the halls, and then they stopped by the Lincoln bedroom. They stood in the doorway, and then took a step inside, but went no deeper. Everything looked the same, but something was different. "We don't allow guests to stay in this room anymore," Mrs. Obama explained. She spoke of it as a place of reverence. They keep it apart, it's not for overnights.

Unspoken, but clearly understood by the Reagan hands, was: This is where he signed the Emancipation Proclamation. A true copy of it is here, on the desk. He signed it: "Abraham Lincoln." The Reagan hands were impressed and moved. It is fitting and right that the Lincoln bedroom be held apart. It always should have been. Good, they thought. Good.
Read that quickly and you'd think that it was Reagan who signed the Emancipation Proclamation. Obama in the same breath as the guy who presided over the Nicaraguan death squads. Oh dear, maybe Greenwald is onto something after all.

Thursday, December 24, 2009

Traders v. Bankers

Naifs wh are still trying to get their mind round the idea of bank as a place where people frantically buy and sell stuff might do well to see if they can scare up a copy of Ken Auletta's Greed and Glory on Wall Street: The Fall of the House of Lehman (1986) in which he chronicles the titanic face-off between Pete Peterson --the "banker"--and Lew Glucksman--the "trader". Glucksman is the loud-mouthed dirt-under-the-fingernails fat boy who succeeds in facing down the urbane and polished Peterson because (a) he was tougher and meaner and scrappier than Peterson and (b) his trading operation made so damn much money.

The comparison isn't perfect. For all his apparent polish, Peterson's background was every bit as modest as Glucksman's--Peterson's father (born Petropolous) had been a dishwasher in the caboose of a freight train. As Auletta stresses, he wasn't a lot of things--wasn't an aristo, wasn't an old-line German Jew, wasn't married got a Mellon, wasn't a polo player. Heck, he wasn't even an investment banker, but he had made himself a bit of money, and had very much learned to hobnob with the high and mighty.

Glucksman (who died in 2006) fit more closely to type. But while Peterson made it his life work to annex himself to the establishment, Glucksman (in Auletta's apt metaphor) "had spent a lifetime accumulating resentments." Everything about the two men--personal style, the structure of their businesses, the indices of personal achievement--were bound to set them against one another.

Plenty has happened to Wall Street banking since 1986 and I suppose the telegraph message is "the traders won." But in winning, they didn't so much demolish as assimiltee their opposites: an investment banker might well say "we are all traders now," and he'd have the likes of Lew Glucksman to thank for it.

[Editor's note: Buce, this is too facile. In fact, the tension between "banking" and trading has been there since the dawn of time. Recall that the original Lehman brothers cut their teeth as traders--specifically in the cotton market. They became a "house of issue"--love that old Wall Street phrase--only after a generation of scratch and claw. Other Wall Street houses, too, show this same uneasy tension between trading and "issueing." Go back to the drawing board and try to find the larger theme.--Right, chief, I'm on it, but for the moment let's go with what I have.]

A Childhood Christmas Memory

The year I was 12, I picked up a touch of pneumonia. I was treated with the then-still -new sulfa drugs, and so it was no big deal. But I did have to stay in bed for about 10 days which made me cranky beyond belief. My mother was not impressed: her own father had died of the same disease in the pre-sulfa era, when she was 8, and she thought I ought damn well to count myself lucky.

But they did let me have some records to console me. Here was my favorite:

Why they didn't just crush a pillow over my head, I cannot imagine.
Followup: Wiki has an enlightening short history of sulfa drugs. Here's a remarkable account--nearly contemporaneous with my own experience--on the use of sulfa drugs on the farm. And here is a biography of the culprit.

Update: Google just informed me that this page is in Slovenian.

The Word for the Day Is...

Wednesday, December 23, 2009

Better Book than I Expected...

I took a quick spin yesterday through Gregory Zuckerman's The Greatest Trade Ever: The Behind-the-Scenes Story of How John Paulson Defied Wall Street and Made Financial History yesterday. I figured it for a reporter's quickie and I assumed it didn't deserve much time (then why did you read it at all?--ed. Ah, there you have me!).

But--surprise! It is a reporter's quickie, but it has at least one special virtue that I hadn't anticipated. That is: for a yokel like me, it probably gave me a better insight into the hedge fund craziness than a lot of more ambitious projects. I mean--here we have one somewhat bewildered and more or less invisible guy (okay, so he was first in his class, so were a lot of people)--somebody on nobody's radar--who had the good luck or good fortune to trust his gut and in one day made $1.25 billion.

I suppose you might say it was a bit more than that. Fortune favors the prepared mind. He did have some good research support (specifically, a researcher also willing to trust his gut). But what kind of poise must it take to go back to your backers every day and say "trust me," and then double down, and double down? Nothing about this was inevitable. Yes, "people knew" that the bubble was going to burst someday. But a lot of people didn't get it at all. And even among those who did--hey the landscape is littered with the parched bones of shorts who went insolvent while the market was still stupid.

I won't go so far as to say that Paulson "deserved" the c.$4 billion that he carted home during that one momentous year--that's a proposition too ambitious for me--but I guess I mind him getting it less than I would mind a lot of other things. You might go so far as to say he came by it honestly. So, not a great book, but a pretty good one, well worth a few hours' time. If you want the executive summary, go here.

Now That is First Class...

My morning's NYTimes has more on the airline' continuing "monetize-the-bathrooms" campaign--i.e., the unending search to squeeze every last quarter out of the thwarted and buffeted airline customer. The topic of the morning is the super-frequent-flyer status:

Members at these levels, in addition to getting bragging rights, might be offered free access to airport clubs and automatic check-in, might get fees for extra bags waived, and might be allowed to go to the front of any line — and sit in the front of the cabin — even when other travelers paid more for their tickets.
Italics added. There is an important difference here. I really don't care a great deal if a 30,000-a-year flyer gets his baggage fees waived--I concede he's probably earned it, and anyway it is more or less invisible to me.

But if he gets to go to the front of the line--ah, now we are talking anger and frustration, if not resentment and rage. It's visible, and it catches me just when I am most sensitive--when I am standing still and wondering why the hell nothing is happening in front of me. If some guy I never saw before pops to the head of the queue, I am very likely to pop my cork.

But is not that the very point? What better way to induce the gratitude and loyalty of their most faithful customers than to give them a chance to demean and humiliate some little people? Mskes me remember Jonathan Winters on the meaning of first-class. In first class, he said, they ought to ring a little bell and you could go back and do anything you want to the folks in coach. Now that, my friends, is first class.

Tuesday, December 22, 2009

Caution: Codger Ranting

Do these posts have anything to do with each other? Yes, I think they do. First, DG Myers on an encounter with a student who got a B in Myer's Philip Roth seminar:

“I did not get any indication through out the semester that my performance in class was less than adiquit,” he wrote. (Since when is a B “less than adiquit”?) True enough, he had followed me into my office one day after class to complain that he disliked the class, disliked Roth, disliked me personally. He had intended to sign up for a different seminar, he said, and regretted his mistake. He disapproved of my teaching style: I firmly directed the conversation rather than letting the students lead the way; I took class time to enunciate my own views and did not scruple to correct a student’s approximations and blunders.

For the rest of the semester he publicly acted out his dislike. He repeatedly yawned in class, loudly and dramatically, dropping his head to the seminar table with a thud, as if to say, “This is sooo boring.” He dismissed Roth’s ideas, after a careful exposition of them on my part, as “stupid.” He would not explain further, when pressed. He laughed aloud when I momentarily lost the thread of the discussion.

Most importantly, he seemed to think that his role as a student was, on slim literary qualifications, to agitate for the opinion that Philip Roth is not a great writer, with little or nothing worth saying. Even if he had had the critical talents commensurate to it, the undertaking would have been beside the question.

[The reader is strongly encouraged to go to Myers' site and read the rest of his detailed account, together with an extensive account of his teaching approach. He concludes:]

In short, [the student] rejected the premise, not only of Roth’s nine Zuckerman novels, but of narrative fiction as such. If he had enrolled in a history seminar with a similar attitude (“I don’t take no stock in dead people,” he might have grumbled), or if he had told his chemistry professor that he disapproved of classifying substances and developing techniques for their transformation into other substances, how would he have fared? Would a B have even been a generous grade?

And now, Felix Salmon (tracking Harper's, on the folks who come to Omaha for the shareholder meeting at Berkshire Hathaway:
Among the pilgrims are RJ Meurer Jr, a senior vice president at Morgan Stanley who storms into Buffett’s barber with his entourage, telling the Brazilian man getting a shave that “You got to get out. We got this barbershop booked.” Or there’s Matt Kelley, a Chicago public-school teacher, who failed at trading in and out of a single Berkshire B share at the same time as conspiring to lose $200,000 of his $150,000 net worth trading on margin; he eventually maxed out his credit card to continue to make leveraged bets.

But Schwartz saves the worst for last, when he finds Talia Eisenberg, along with her father’s girlfriend, getting thrown out of an Omaha bar for being drunk. Talia is the daughter of Robert Eisenberg, who himself is the son of an early investor in Berkshire. With her unearned riches she has opened an art gallery on the Lower East Side; she also receives glowing press from NYC society blogs, complete with comments extolling “her generous heart”.

She’s not going to be happy about this:
“Do you even know who we are?” Talia asked. She thrust her hand into her purse. Out came a grip of shareholder credentials.

“I don’t care,” said the manager. “You’re getting out of this restaurant. Now.”

The women strutted out to a black Mercedes-Benz. As Talia drove, she enumerated a few of her present frustrations. She hated the tacky nowhereness of Omaha. She hated the gawking shareholders who think they own it for a weekend. Most of all, she hated Gorat’s for unjustly ejecting her from the premises. “They thought I was a whore because I’m good-looking and rich!” she exclaimed. “What can I do?”

“They never see the likes of us around Omaha,” replied Tanya.

“We have more shares than all those fuckers,” Talia said…

“Where were you at the cocktail events?” Talia asked me. “We were there with all the ballers. The real deal. You didn’t go to Borsheim’s, did you? That’s where all the suckers go, with one baby B share. The big parties are up at the houses.”

This is what happens to the millions of dollars that Buffett earns for his earliest and most loyal investors: they end up fueling the very snobbery and condescension that Buffett himself could never abide.

Talia’s young, and she was drunk (and she was driving drunk, to boot), but maybe it’s only the young and drunk shareholders who will ever come out and say — to a journalist, no less — what most of the people “up at the houses” are thinking.
I suppose the general message here is obvious enough: the world is going to hell, these young whipper snappers, they don't know what life is all about, there were giants in my day. You can find a more measured response from me in the comments to Myers.

Semi-Appreciation: This Time Is Different

No queestion but that Carmen Reinhart and Kenneth Rogoff have done themselves proud and made themselves the envy of finance scholars everywhere, putting together what must be the world's most extensive data set on financial crises. So no wonder they are getting rave reviews for their new book, This Time Is Different. Hard to imagine project better positioned to catch the attention of people who read about finance.

And yet I wonder if this is perhaps a book more purchased than read, more read than understood, more tslked about than really assimilated.

Or rather, two books. In the first 192 pages, we have a formidable tour d'horizon of the "Eight Centuries of Financial Folly," as promised by the cover, together with at least an attempt at analysis and summary. It bespeaks a massive amount of original research, together with an energetic effort to understand and assimilate the work of others, and we shouldn't be too distracted by the fact that it's more like six-and-a-half centuries than eight, more like two or three than six-and-a-half. It's an absorbing read, full of tables you can lose yourself in and cool graphs that I suspect are showing up on classroom projectors all over the world. There is also no end of provoking factoids: what is the only modern country to grow itself out of a debt crisis? (Swaziland); what country lost its sovereignty to debt just 80-odd years ago (Newfoundland--you'd forgotten?).

There are also some more interesting general takeaway points; eg: debt/GNP ratios are not the only, nor even the most important, source of sovereign default; "mature" countries may outgrow sovereign default but nobody outgrows banking/financial crises; and banking/financial crises seem to affect "developing" and "developed" countries with virtually equal frequency and severity.

There is also a good deal of meta-discussion of, e.g., how their work differs from others, and what sort of additional information they wish they had (the answer to that one: plenty). Indeed, this topic of "extra information" is one on which I might presume to venture a substantive criticism. They mention in passing that their understanding of inflation is hampered, inter alia, because they can't tell when and to what extent inflation was anticipated. Indeed; and this might be a more general point than they realize. To understand any kind of default, we really need to know whether and to what extent the lender anticipates the possibility that he will lose the value of his loan. If he does so anticipate, it may be that we shouldn't count a particular instance of nonpayment as a "loss" at all--but rather the playing-out of a budgeted contingency.

But let that be. The "second" book within these covers (94 pages) is an account of the current uproar--as R&R brand it, "the U.S. supbrime meltdown and the second great contraction." Material from this part of the book began to surface in the blogs about a year ago if my memory is right, and it got a lot of attention for its stark (and well-documented) message: based on what we (R&R) know, the "great contraction" will last a lot longer and cost a lot more than we have led ourselves to believe.

It's a sobering message and so far, events seem to be playing out pretty much as they predicted they might: the mess is costing a lot, and it looks like it will last long.

You can't argue with them for being right on this one, and you can't fault them for the special quality of rightness that comes through the swinging doors with its pistols loaded. Yet it is the very drama and focus of this "second book" that leads me to a suspicion--namely, that this is a rush operation, hurried out at the behest of their publisher to take advantage of current events. This would explain (a) the somewhat unpolished and incomplete character in the "first" book; and (b) the fatal timeliness of the second, which translates into the sad certainty that it is bound to be out of date in a matter of months or weeks.

I said two books. Actually, there is a third: nearly 100 pages of appendices amplifying just about every topic they have touched on earlier. This is bound to be a treasure trove of grest material, but its very presence adds to the suspicion that there is something undigested about the whole project.

Taking all in all, it is still a good book, based on what has to be recognized as a monument of good scholarship. But you salute the importance of the scholarship while recognizing that it's not as good a book as it might be.

The Top Ten Are...

Louisiana, Hawaii, Florida, Tennessee, Arizona, Mississippi, Montana, South Carolina, Alabama and Maine.

Top ten what? Look here.

I've Checked...

...and there is really nothing on this list that I want. Better check for vital signs.

On the Anti-Terror Frenzy

Wired has a great piece up about dumb ideas, Rube Goldberg devices, outright cons and such like in the anti-terror apparatus mania. It's taking my mind back to the golden age of the Soviet A-Bomb obsession, when schoolkids all learned how to hide under their desks, as if to prevent from--what, exactly?

And in particular, the fallout shelter. Your own backyard bunker, best when stocked with lots of dry candy bars and bottled water (and a shotgun to fend off the neighbors) to protect you against the little squigglies in nuclear dust.

My mother, by then a grand mother, would lament about going to live in a hole in the ground "where you would just linger a little longer." In time, she turned it into a marketing scheme "Grandma's Linger-Longer."

I wonder if there still are fallout shelters; probably so, now doubling as tool sheds. Here's how it went:

Monday, December 21, 2009

Medical Tourism

For all those horror stories of Canadians fleeing to the US for medical care, Joel serves up the horrific/happy tale of from John Freeman from Reno:
[Freeman]needed a coronary bypass. He had dropped his catastrophic insurance coverage because the $320 monthly premium was eroding his retirement savings and the $5,000 deductible left him with big bills.

Facing a $100,000-plus operation, he thought he had two choices: "submit or die."

A friend pointed him to a third: World Med Assist of Concord, which lined him up with a heart surgeon in Turkey. The all-inclusive cost: $18,000. He had the surgery last spring and "unreservedly" recommends the care.

U.S. doctors refused to give him a price. "They would almost be proud of it," Freeman said. "They would say, 'That's not my department, I do operations. I don't have any idea how much anything costs.' Even the nurse would get mad at me and say, 'You want me to connect you with the billing department?' "

But for Freeman, cost mattered. "For people who can't pay, somehow the government won't let them die. But if you're like me in that awkward middle, where you have a little money saved, they'll take it all."

There's more where that came from, including this schedule of estimated comparative costs:

Heart bypass: $8,500 in India; in the U.S., $144,000

Liver transplant: $75,000 in Latin America; in the U.S., up to $315,000

Dental implant: $1,000 in Costa Rica; in the U.S., $2,000-$10,000

Face-lift: $4,000 in Singapore; in the U.S., $15,000

Knee replacement: $10,650 in Mexico; in the U.S., $50,000

Not a Moment Too Soon...

Winter Solstice, 0947 PST.

Thanks, Scott (and assorted pagan deities).

Sunday, December 20, 2009

Sandel with a Hole in the Middle

Still trying to master the kind of stuff a first-year law student might want to know (cf. link), I nosed into a Kindle copy of Michael Sandel's Morality. It's billed generally as an introduction to major doctrines and issues; I assume it is a rework of his first-semester teaching notes. On these terms, it is every bit as good as so many other reviewers have said it is, but I want to note an aspect which, so far as I know, others haven't showcases yet. That is: it is also an elegantly crafted piece of advocacy. But it's advocacy with a hole in the middle--a gap big enough to drive an a priori through, and enough seriously to impair the cogency of its own central point.

It's not that Sandel has ever been particularly coy about his views on competing approaches tohis topic. From the beginning of his career, he's made himself perhaps the most persuasive public advocate of a perspective of ethics that you could well (even if he does not) "communitarian." At Harvard, he has long occupied the chair of the guy is who is not John Rawls and not Robert Nozick. A bit like being the most important Beatle after John and Paul.

In this new offering, Sandel operates with deceptive ease, but at the top of his form. He begins with a couple of chapters of standard classroom hypos, as if to beguile his students into believing his topic is interesting. He then moves on to an account of classic utilitarianism which skewers the doctrine so suavely and thoroughly that you have cudgel your mind to remember why it counts as a doctrine at all.

He then moves on to libertarianism (that's Nozick, whom he treats respectfully) and then exposition of Kant. Taken at face value, this presentation of Kant may well be the centerpiece of the book. It's really about the best non-technical exposition of Kant's ethics I ever read (indeed, the next logical step along the same line might be Rawls' own undertaking in his Lectures on the History of Moral Philosophy 143-234 (2000)). But Sandel's cape work is exemplified through so many elegant flourishes, you may not notice how many banderillas he seems to have planted along the way.

After Kant there's a bit on Rawls which is respectable enough in itself, although I have never been able to shake the conviction that Rawls was put on earth to reassure Harvard students that they deserve their life of ease and privilege. Sandel moves thence to a discussion of "virtue ethics" by which he suggests that he means Aristostle, but don't kid yourself. Sandel understands perfectly well that Aristotle dates on us after 2300+ years, but he is a grand legitimatizer for the capstone of the analysis---the communitarian program.

In crude oversimplification, it goes something like this: this Kant fellow (with his sidekick, Rawls) is all well and good, but he operates on a model of humanity which is way too abstract, and ends up leading him to untenable positions. "I" am not an abstraction. "I" am a whole tangle of relationships, past and present, which together determine what I am: my mother's daughter, the apple of my father's eye, the Man who Knew Coolidge, the Man who Broke the Bank at Monte Carlo, whatever. My job in life is to try to retell these stories--to reweave the fabric, as it were into something coherent that I might call "integrity." My view of morals/ethics, by corollary, cannot be reduced to a formula. My views on these issues most be a product of my very human situatioin (Sandel doesn't cite Hegel here, but I think he is describing sittlikheit.

This is all wonderfully well done (albeit he draws heavily on Alisdair MacIntyre; if you want an expanded version of Sandel, you would go to M's After Virtue, or maybe all the way back to his Short History of Ethics). Indeed, I am profoundly in sympathl;y with this view and if I wanted to sell anybody on it, Sandel might well be the place where I would start.

The trouble is that, unless I was dozing, Sandel offers not a hint of advice on how we address the greatest difficulty of "virtue" ("communitarian") ethics--the question of how, after all, we define the good life. He's entirely right to say that Kant's dispassionate "reason" is weirdly inhuman when it says I should treat my own child an a Solami orphan as having equal claims on my responsibility and care. He's right to say that Robert E. Lee did something attractive when he puzzled his personal conflict between loyalty to the union and loyalty to the state. But he's equally right to recall the deal-killing endpoint with regard to Lee: slavery is wrong, and it took us four years and uncounted bloodshed to make the point.

Sandel is forgetting (or more likely, just ignoring) the central reason why "liberal" or "privatized" ethics came into being in the first place. Go back to the 17th Century and the end of the Thirty Years' War. Europe had gone through one of the bloodiest and most unsaatisfactory spasms in its long and bloody history. No wonder that any number of thinkers (start with John Locke, but there are others) wanted to stand up and say "okay, everybody just shut up, simmer down, and go home. I will keep out of your hair if you will keep out of mine."

That root difficulty--the difficulty getting consensus on the definition of the good life--is what has individualist liberalism so enduringly popular (Kant is only its most elegant exponent). Sandel is right that it ends with incoherence--was there every a philosophical doctrine that did not end with incoherence? But it may be that this incoherence protects us all against an even greater sacrifice. I'd love to see Sandel deal candidly with this topic. Might be a good subject for his next book.

Footnote: I see that the "most helpful critical review" of Macintyre's Short History of Ethics gets an Amazon customer vote of 0 for 2. Huh? But then the others get 0 for 7, 0 fo 11 and 0 for 13 (FWIW, it appears that all four negative may have been "written" by the same person).

Saturday, December 19, 2009


Silicon Valley Insider has a clever list of 21 things that became obsolete in the last decade, including a sometimes-interesting discussion of which of these are really obsolete (Is the land line gone? Chez Buce still has a land line, but why?)

One item I didn't notice on the list: the flash drive. I bought two the day before I discovered My Dropbox. Oh, and later Evernote.

And here's a candidate for shortest lifespan: installed dashboard GPS. Mrs. B got one on her new Toyota in 2004; we thought it was cool. Seems like two blinks of an eye and everybody had one on their pocket gadget.

[H/T: Carpe Diem.]

Update: Okay, so I open my Sunday paper this morning and there's a huge ad showcasing the dashboard GPS on the Cadillac Escalade. Does this mean I am behind the curve? Or they?

Opera: The Met's HD Tales of Hoffman

I can't remember when I've seen such a first-rate combination of staging and singing as we saw today in the HD theatre broadcast of Offenbach's Tales of Hoffman from the Met.

The singing, to coin a phrase, kind of speaks for itself (but I will say more infra). The staging--well, if you don't like it, you will say that it is cluttery and intrusive. If you like it, you know that the reason it works lies in the nature of the opera itself and its composer. Recall this is Offenbach's only "serious" opera (or the only one that persists in the repertoire). He wrote it toward the end of a career, in which he felt increasingly the need not just to prove himself but to justify himself.

And everything about Offenbach is a contradiction. He is a Frenchman, but he's not. He's a Jew, but he's not. He's a serious composer, but he's not. He's a divided soul. He's a cosmopolitan. And that is the point. I've never seen any production that goes further to identify the welter of cultural connections that Offenbach can exemplify.

Offenbach wrote the opera in the 1870s--a troubled time in France, hard on their humiliation by the Germans in the Franco-Prussian war (he staged a performance at his home in 1879, but then died in 1880, before any full public staging). The Met's director, Bartlett Sher, says he has pushed it forward to the 1920s, which is true enough but only up to a point. Granted, there are enough cabaret touches that you half expect Joel Grey to pop out and shout "Wilkommen!" But there's a lot more than that; there's plenty of leftover Belle Epoque; there's an anchoring pub scene and for the finale, the whole gang goes to Venice. The point is that the music seems to be able go resonate with all of these.

Joseph Calleja here in his first outing as Hoffman is the glue that holds it all together, the same way James Gandolfini holds together The Sopranos. Calleja has said himself that the voice is a fine fit for the music and he's right: Calleja seems as much at home in Hoffman as Anthony Dean Griffey is in Peter Grimes (except that Griffey may be a one-opera singer; Calleja has given every evidence that he is nurturing a full career). Calleja gives you a Hoffman who is all of a piece, a searcher and a sensitive soul. And also something of an outsider; Sher likes to talk about Kafka and that is not wrong, but you could tell the story as a chapter in the long history of romanticism without any reference to Kafka at all--or putting it the other way around, calling him "Byron" would do just as well.

Aside from Calleja, I thought the most winning personality onstage today was Kate Lindsey as the muse. She doesn't have the strongest voice but she knows exactly what she wants to convey, and she is on stage through almost the entire production--detached and ironic, yet still sympathetic with her somewhat bewildered protege. The star turn belonged to Anna Netrebko as the thwarted prima donna. She turned in a perfectly creditable performance, but it's remarkable that this segment actually seems somewhat thin in a presentation like this where a different woman sings each of the three leads.

James Levine was back at the podium, dealing (to all appearances) graciously with a back brace. Sher got to join the onstage applause line at the end, along with Michael Yeargan the set designer Catherine Zuber who did the costumes--and well deserved, I say, probably should happen more often.

A side note: if you're having as much trouble as I did getting a grip on Offenbach, you might consider starting with La Vie Parisienne, which must be about the most successful of his undertakings in opéra bouffe. "Comic" is just exactly what Hoffman is not, but this blowout extravaganza in a medium with which he was much more familiar may give you a more accessible sense of what he thought the musical stage might be.

Afterthought: Just a few days ago, we watched Red Shoes--Michael Powell's high-kitsch mash note to The Arts. Powell weent on to do Hoffman, and I can see now how much Powell's Hoffman is a sequel to his Red Shoes. In retrospect, Powell's Hoffman is good fun, but it's got about as much to do with Offenbach as it does with John Wayne.

Friday, December 18, 2009


I got a look last night at Matteo Garrone 's Gomorrah --the movie based on Roberto Saviano's book about the Neapolitan Mob. It's worth the watching, though not as good I might have expected from its passel of awards and its 91 percent Rotten Tomatoes ranking (that's as of this writing).

Tbe film is presented as six not-very-interwoven stories of footsoldiers trying to scrimp out a living in the life of crime. Perhaps the most interesting is he account of "Don Ciro," the poor slob who has to deliver money every week to the mob's retainers. It's one of those vignettes (like my favorite scene in Donnie Brasco--the one where Al Pacino cracks open the parking meter) the reminds you that the mob is just another business, and not a very good one, at that. You can only wonder how in the devil Don Ciro--far more frightened than naturally violent, or even corrupt--ever got into this mess and, for whatever it is worth, you are left wondering how he will get out of it.

Overall, the movie is well shot in a lot of soul-draining suburban Naples locations, with a style refreshingly free of the "violence porn" that proved all too seductive in some of the late episodes of The Sopranos. There's plenty of death here but (as it should be) it seems off-handed and stupid more often than dramatic or spectacular.

The trouble is that the director seems (or wants you) to believe that he is presenting the epic of a vast international crime syndicate. And there may very well be such a syndicate but he hasn't shown it. For the most part, he hasn't even hinted it. The most ambitious and enterprising of all the mobsters (if can call him that) is the Franco, who takes a trip north to Mestre, the ugly backwater just inland of Venice, where he acquires a waste disposal contract. We are to assume that the waste is toxic, and that it does great harm to a trucker, and that the disposal operation is illegal. This is a nasty business, but you can't help feeling at least a bit of sympathy for Franco who is, after all, doing a job that a lot of people want done. Too, you've got to admire his enterprise when, in the movie's most memorable scene, short of "real" drivers, he recruits a bunch of street kids to pilot his giant disposal vans.

But Franco is as far up the chain as you go, and for all we see here, he might just be a freelancer. As to poor Don Ciro--we don't even really get to know who it is that he is delivering money from. As to the rest, they are just street punks (and one cadet punk) or neighborhood heavies. So, a good movie, perhaps a welcome corrective after the excesses of The Sopranos (which, to be fair, I liked a lot). But still not a major movie, nothing that redefines the landscape (unless, of course, you count the truckloads of toxic waste).

Makes You Glad You Never Wrote a Book

Self-important, pompous, pretentious, solipsistic, often obscure, sometimes barely coherent, [this] book seems to address itself only to those in the know.
Let's see, did I forget anything? Oh yes:
The translation ... renders these faults with exemplary accuracy.
That's Richard J. Evans ending s book review in the London Review of Books,12-14, 14 3 December 2009

Are You Ready for Eight Questions?

It's a few days old, but this is the first, second or third-best thing I've read this week so it deserves a shoutout--Kent Thune offering eight questions to ask yourself as you consider investment advice. Not least, number eight:
  • Have you ever made money by following a “where to invest” article’s suggestions?
Link. I assume that's rhetorical. And note to self, add his blog [I see now that the same piece is posted there].

Three, you say? So, what are the other two? In no particular order, Sanchez on ressentiment, and this cranky morsel from Delong's comments:
WTF does Republican Party has to do with it? At City CEO tried to dilute the shares to kick the government out of ownership - and failed. In the normal country he'd be in jail for gaming the stock. In the moderately corrupt country (think Russia or Uzbekistan) he'd be out of the job for doing the same and failing. In the howling-at-the-Moon United States he ... gets to try again. In the meantime, the guy in Texas gets 8 years for being caught doing graffiti. Can we please wipe this place from the face of the Earth and try again?
Per "Baboon," and damifiknow.

Thursday, December 17, 2009

Appreciation: Murakami's Wind-up Bird Chronicle

Reading Haruki Murakami's Wind-up Bird Chronicle, I sometimes had to remind myself that it's held in high esteem in Japan. This is not to say it's a bore; rather, on a page-by-page basis, it's a lot of fun. Murakami knows how to spin a story, in the sense of making you ask "what happens next?" But I believe I read somewhere that he starts out not knowing where his characters are going to go. He might have been bragging; Dickens said something the same of himself, and Murakami probably wouldn't mind keeping such company. But in Murakami's case, I think it has to be counted a defect. In the end, he makes no more thn perfunctory effort to draw them all together. We are left with what reads more like a collection of classroom exercises, elegant in their way, but lacking any sense of a larger whole.

Yet some general themes emerge in spite of all. One is the pervading influence of western culture--not just American; a theme from Rossini's Thieving Magpie comes as close as anything to being a motif in this book. It might be just Murakami; I'm inclined to suspect thst it's more general and indeed, might explain his popularity with Japanese readers.

Another "recurrence" (if not exactly a theme) is the persistent passivity of the protagonist. Granted novelistic protagonists are often passive (Guy Crouchback was in Sword of Honor). But one suspects the Western reader may be encountering something more remarkable here--that phenomenon the Japanese call hikikomori, the disposition to turn in and drop out so much remarked upon among young Japanese, particularly men. Toro Okada, the protagonist here, may not be quite a typical case: at 30 he perhaps a bit too old. But there's something eerie about his capacity to stay disconnected, and perhaps equally eerie about the capacity of those around him to treat his passivity as unremarkable.

Two other "themes"--if you cvan call that--provide a bit more specific intereset. One is Toro's brother-in-law, the villain of the piece, a rising young politician. From the brother-in-law, we do get a plausible sniff of the aroma of avarive and corruption thst seems to have formed so durable a part of Japanese political life.

The other is easier to describe, if harder to integrate. Among many other stories, Murukami gives us a string of anecdotes from the ugly years in and around World War II, and in particular, the dreadful campaign of the Japanese to plant a "new nation" of sorts in Mancuria, north China. Although it is never made clear just what they are doing here, Murukami offer some of his most powerful and persuasive material in these accounts related to the Manchurian campaign.

A final curiosity: I've read a number of reviews of Wind-up Bird (which was first published in the United States in 1998). Most of them seem impelled to speak highly of it, to give it high marks. Yet on close reading, one gets the sense that most of the readers didn't like it very much. Is this some kind of reviewer trade code--say what you want about a "famous and important" book, as long as you give it high marks at the end?

Waugh and his Precursor

Chez Buce enjoyed a viewing of Evelyn Waugh's Sword of Honor trilogy on the big screen at the Buce Odeon last week. We'd both read the novels, though separately (this is a strong pro-Waugh household). We give it two thumbs up; it's one of those rare events, a really successful screen representation of what was already a pretty good book. Or so I would have thought; but if so it confounds my theory that good books don't make good movies--only mediocre books make the transition, because there's too much going on in a really good book to be satisfactorily transmitted to the screen. But this doesn't seem right; I retain my high opinion of Waugh, on paper and on screen. The clue might be that Waugh makes his points by understatement: by setting up character and situation and then letting the voices speak for themselves. Perhaps this is something that really does transfer well to the screen. Besides, we all know that the Brits just do these movie transfers better than anybody else, so if anyone has a chance, it is they.

One point that had never struck me before: how much of the overarching plot of the Waugh trilogy is a reflection--okay, almost a direct steal--from the other great British multivolume war novel. That would be Parade's End by Ford Madox Ford, which we read just last winter. Think about it: old-school (if slightly down-market) aristo, wedded to a creed almost comically antique (think Don Quixote here)--and yoked to a woman so richly undeserving as to make you gasp (but admit it now: British girls never did look like a lot of fun, did they?). He moves more or less impassively through his War surrrounded by lunatics whose capacity for harm is limited only by their incompetence. Poor Ford. He never did get the respect he felt he deserved, and had he lived long enough to read Sword, I'll be he would have thought it actionable.

It brings to mind what I've always seen as an other case of arrant imitation in high places. That would be Henry James and George Eliot--in particular, James' sniffy, dismissive review* of Middlemarch, (one of) whose plot(s) he then suavely lifted for Portrait of a Lady. Perhaps we should just write it up as homage.

*In the Library of America Henry James: Essays on Literature--American Writers, English Writers at 958-66. See also his comments on Daniel Deronda, id. at 973-92 (1984).

Wednesday, December 16, 2009

Sanchez on the GOP Mood

I agree with almost everything Julian Sanchez says about the distinction between schadenfreude and ressentiment, and how the latter, not the former, is what ails the Republicans today. He might have gone a step further and pointed out tht ressentiment, per Nietzsche, is Christianity's natural home. In Genealogy of Morals (and elsewhere) he isolates it as the mainspring of a slave morality, in odious comparison to the heroic morality that is Nietzsche's beau ideal. There's whole academic industry devoted to the task of expunging this blood libel, but the concept does continue to raise its head.

Soul-searching a Goldman Sachs

Partner #1: How come nobody loves us any more?

Partner #2: Dunno. Screw 'em.


Update: Yes, you're right,they aren't "partners" any more. That may or may not be part of the problem.

Yegor Gaidar, 1956-2009

A brief personal anecdote: I did one consulting gig in Russia, back in 1995 during the rush to privatization. My brief was bankruptcy law. I remember how, tucked away in a tiny and poorly lit office, I told my American interlocutor: look, I cannot begin to tell you what kind of bankruptcy law you want unless I know how you collect a debt in Russia now. My interlocutor turned to his Russian "expert;" after a brief exchange in Russian, he turned back and said: "she says they don't have any collection law now; if you need to collect a debt, you just get together a bunch of your friends and go get it."

Such was my brush with "shock therapy," the swift and painful program of transistion from socialism to a market economy imposed in Russia after the fall of communism, under the leadership of, among others, Yedor Gaidar, whose death is reported today . News stories say he died of "complications following a blood clot," but if this story sticks, then there are bound to be conspiracy theories, and I will cheerfully join them. As co-architect-in-chief of the Russian transition to capitalism in the 1990s, Gaidar certainly had plenty of enemies, high and low. Forget about tiny and poorly lit offices: just walk the streets of Moscow back in those days and see the babushkas hawking Mars bars outside the the subway stations in the snow, and you could understand that not everybody saw virtue in the program of mass privatization that Gaidar espoused. There were plenty of others, not so directly harmed, who argued at least in hindsight that Russian privatization moved to quickly, with too little attention to the creation of a legal infrastructure. Proponents of market reform stayed mostly unapologetic: you had to grasp the moment, they said; any other scheme would have become bogged down and come to naught [but for some subtle second thoughts, go here].

But like it or not, the fact remains that Russia was and remains a Wild West show, with huge rewards available to those willing to take huge risks, and where players cannot be certain that they will die quietly in their own beedr. Gaidar himself appears to have been the victim of an attempted poisoning in Ireland in 2006, just a day after a Russian dissident was poisoned in London.

Gaidar himself exercised real political power for just a brief moment at the height of the transition. Like market liberals everywhere, his program was attractive enough to win him attention in the western press, but never enough to compel any more than a rump minority of voters.

Gaidar seems to have taken the decline of his influence in stride. He continued to write and speak about Russia and the cause of market reform. Russian Prime Minister Vladimir Putin and President Dmitri Medvedev uttered kind words in his memory this morning--perhaps easy enough, now that he is safely dead. It would be interesting to know how the real Putin, unbuttoned or under truth serum, thinks about the task of market reform, flawed or otherwise.

An Economist obit of Gaidar is here. DeLong has a brief personal remembrance here. "Chris" in DeLong's comments links to a postmortem on shock therapy by Gaidar himself.

Update: here's a striking personal tribute that suggests we need to seek no conspiracy theory, and that casts doubt on my suggestion that he took his decline from power "in stride" link.

Tuesday, December 15, 2009

Silliest Statement I've Read All Day

From a blog entry by Randall Holcombe, otherwise unknown to me, which I first took to be a howler reprinted as comedy from a student exam:
Marx was a supporter of unions, because unions could give workers some collective power to limit their exploitation. Legislation like the proposed “card check” to extend union representation, and the ceding of substantial shares of GM and Chrysler to the UAW are some examples of Marx’s ideology at work.
Boy, if that is what passes for teaching at Florida State, then we have one more argument for the abolition of public education.

Let's begin. Of course Marx said nice things about unions. The enemy of my enemy is my friend. And if the bourgeoisie is going to get itself organized, then the workers had better get organized too.

But the whole point of the bourgeois-proletarian conflict is that it is a point of transition, where the name of the game is dynamism. It depends on--it makes headway among--a proletariat when the proletariat is fluid, alien, ungovernable and ungoverned. Comes the revolution, all this will pass a way.

And this is why Marxism in its golden age had no more implacable enemy than a strong, focused, effective program of democratic trade unionism. Marxism is revolution. Trade unionism is stability and order. The democracies that emerged as bulwarks against Russian Communism in Europe understood that they knew that the way to fight off Communism was to nurture the unions and keep them strong. So did the Soviets, who understood that nothing stood higher in the program of revolution than to isolate the unions and leave them emasculated and paralyzed.

Do unions go sour? Of course. Recall Enoch Powell's dictum that all politics ends in failure. Unions get corrupt, entrenched, elitist, the enemies of a dynamic society. Ironically it is in this phase that unions most evidently lose precisely what made them so attractive to Marx--their energy and creativity as part of a functioning economy. It's a delicate balancing act, this attempt at equipoise between anarchy and reaction. But any way you read it, if you want to get to the socialist nirvana, the unions must be pushed out of the way. So to say that union programs are "some examples of Marx’s ideology at work"--that's a pretty good giveaway of a writer who doesn't understand the first thing of what Marxism was about.

Extra credit question: Marx liked cigars. Cigar smoking is an "example[] of Marx’s ideology at work.

19th Century Shakespeare

We (=I) tend to dismiss 19th Century Shakespeare as just so much arm-waving and bluster, as if nothing much happened before Granville Barker.

We (=I) may be mostly right, but it is useful not to get carried away. But here is an appraisal that strikes me as surprisingly modern, and from a surprising source-the famously irascible sixth President of the United States, John Quincy Adams:
Hamlet is the personification of a man, in the prime of life, with a mind cultivated by learning, combining intelligence and sensibility in their highest degrees, within a step of the highest distinction attainable on earth. He is crushed to extinction by the pressure of calamities inflicted, not by nature, but against nature, not by physical, but by moral evil. Hamlet is the heart and soul of man, in all their perfection and all their frailty, in agonizing conflict with human crime, also in its highest pre-eminence of guilt.
H/T: CrankYankee, who evidently does historical dress-up recreations of JQA. Credited to a journl entry for February 19, 1839.

Monday, December 14, 2009

Farnsworth's Legal Analyst

Getting ready to begin my 40th year in the classroom, I took a spin through Ward Farnsworth's The Legal Analyst: A Toolkit for Thinking About the Law (2007). It's fun and rewarding on its own terms, but also a rewarding opportunity to reflect on how things have changed over my professional lifetime. And before anything else, I should specify that Farnsworth is a superb explainer, topnotch at packing some difficult concepts in accessible, yet still intellectually honest, terms. Farnsworth says in his preface that he hopes it will appeal to "law students, lawyers, scholars and anyone else with an interest in the legal system." Right enough, although I suspect its primary audience may be students just finished with their first year, perhaps waiting for a jingle on the employment hotline. Or perhaps even more important, it will be another one of those books that the professor tucks in his own top drawer, so as to trade on some bits of intellectual capital that he hasn't earned.

As one might guess, the heart and soul of Farnsworth's book is the stuff drawn from "economics," or more precisely "law-and-economics," that congeries of insights, puzzles and provocations drawn mostly from the first-year micro econ curriculum. And here is the field in which the evolution of the modern law curriculum is most obvious. I sat down for my first law school class in the fall of 1963. That would be three years after the publication date for the publication of Ronald Coase's The Problem of Social Cost, which serves s the law-and-econ analog to the role played in mainstream econ by Adam Smith's Wealth of Nations. My own guess is that none of my own professors* ever heard of Coase--or if they had, that they ever troubled themselves to find out much about him. This isn't to say they were bad teachers. Well: some were bad teachers, but one or two (or three?) were among the best teachers I ever had in my life. They just didn't see this law-and-econ stuff as in any way relevant to the (formidable?) traditional education that they undertook to impart.

I suppose I read Coase before I started teaching in 1969, by which the article had been abroad on the land for nine years (and Farnsworth himself would have reached the age of two). I have to admit I had trouble grasping it at first, but in this apparently I was not alone. Anyway, I got on board soon enough that I was able to track a good deal of the intellectual current as law professors grasped and then embraced the new economic learning. For a while it seemed as if everyone was styling himself a "law and econ" person; hiring committees were hot for law-and-econ people, and everybody was offering, or planning to offer, or pretending to offer, law and econ courses.

What was my point here? Oh yes: my point is that I'm struck by how much those days have passed us by now; to what extent "law and econ" has become common sense, common knowledge, part of the substrate. We once thought that Coase, etc., required a separate course. I suspect now that a good deal of the Coasean wisdom has passed, at least in vulgarized form, into the mainstream curriculum. The same might be said for some of the other, closely related, topics in Farnsworth's book: the stuff on game theory, for example, or the small dose of basic probability learning.

If I'm right so far, it may seem that I raise an awkward question: to what extent are Farnsworth's insights part of a "toolkit," and to what extent just "stuff that you learn in law school?" I don't have a pat answer to that one and in any event,I suppose I am taking aim at a moving target. But if we've reached the point where one guy can sketch the stuff out and put it into a (highly readable) short book, then we are veering close to the point where it isn't really specialized knowledge at all.

This offering provides background for my take on the latter portion of the book, where Farnsworth discusses topics from (as he calls it) "psychology"--with chapter headings like "hindsight bias" and "attribution effects." If you've followed the literature at all, you know we are now out there beyond the bob wire, in tht uncertain no-man's land where the economists and the psychologists come head to head. Or where, more sharply, the economists are laying down an imperialist claim to be masters of all knowledge.

The provenance is clear enough. An abundance of evidence has persuaded even the diehards that traditional economic models of human behavior were crude to the point of caricature. The current agenda is to try to find ways to refine the crude models into a more subtle and appreciative understanding of human behavior. It's all the rage and it has indeed generated some interesting results.

Well, fine. Yet I have to wonder how much of this stuff counts as "new insight" and how much as "things we knew or should have known all along." I need to tread with delicacy here: I do not want to come across as a total Philistine. I suppose it does help at least to be reminded that people value risk asymmetrically; that the benchmark determines the agenda, and that the person who sets the agenda wins tahe argument. Maybe I want to say that these are all things that a smart cop or a successful political consultant knew all along.

Indeed, maybe it is only the professors who did not know--and I don't think this suggestion is quite as ridiculous as it might seem on the surface. I suspect it might well be that professors are the class so disposed to get bound up with their theories that they forget what they might learn from their intuitions. And recall Peter Drucker who said that the hardest thing to know is what you are good at, precisely because you are good at it, so it becomes invisible. A corollary may well be that one becomes a professor of (a) sociology; (b) psychology, (c) economics; (d) law, precisely because one does not have a knack for those things that make up the common-sense parts of the discipline. Admit it now: how many of us heard a psychologist at a seminar presentation report "we were surprised that"--only to report something tht doesn't strike you as very surprising st all?

Or maybe not. This seems to me to be a question rife with difficulties which neither I nor anyone else has explored with the insight it deserves. Meanwhile it is good to have Farnsworth as a field guide to the state of play. I think I'll stock up on a few extra copies, for young friends who are thinking about taking the plunge into law school themselves.

*At the University of Louisville, where I got my first law degree. After Louisville I did a "cleansing masters'" at Yale, where Coase was hot stuff.

The Thing About Lieberman...

Is not that he is "conservative." Whatever that may mean, he's been one since before he was elected to the Senate; for the voters of Connecticut, what they saw is what they got. And it isn't that he is a whore for the insurance industry: every senator, bar none, is in the pocket of his dominant local constituency. And it isn't even that he is against "health care reform;" there are a lot of wonky issues in the fabric here and it is (would be) possible to go a long way with particular issues without exciting quite so much ire.

The thing about Lieberman is that he seems determined to do it all in a way that is calculated to irritate the maximum number of Democrats.

I really haven't any good idea why this might be so. I guess you could say that he's always had a bit of a chip on his shoulder, although that doesn't explain very much. Or that he is still mad about the Ned Lamont challenge, though heaven knows why that would be enough to set him off: politicians win some, and they lose some. That's politics.

There really is something different about his determination to put a different stylistic stamp on his opposition; to make sue that when St. Peter (or whoever does it for orthodox Jews) checks his clipboard, he'll say "aren't you the guy who....?" I had a cousin who, as an infant, when frustrated, would sit on the floor and shout "pisty hog!" We've always remembered that.