Sunday, January 02, 2005

My Moral Awakening

The New York Times > Opinion > Op-Ed Contributor: The Ends of the World as We Know Them

A society contains a built-in blueprint for failure if the elite insulates itself from the consequences of its actions. That's why Maya kings, Norse Greenlanders and Easter Island chiefs made choices that eventually undermined their societies. They themselves did not begin to feel deprived until they had irreversibly destroyed their landscape.

Could this happen in the United States? It's a thought that often occurs to me here in Los Angeles, when I drive by gated communities, guarded by private security patrols, and filled with people who drink bottled water, depend on private pensions, and send their children to private schools. By doing these things, they lose the motivation to support the police force, the municipal water supply, Social Security and public schools. If conditions deteriorate too much for poorer people, gates will not keep the rioters out. Rioters eventually burned the palaces of Maya kings and tore down the statues of Easter Island chiefs; they have also already threatened wealthy districts in Los Angeles twice in recent decades.

When I was in high school I was a great fan of Ayn Rand. In fact, I read her complete works from Atlas Shrugged to her essays in For the New Intellectual which, at 15, I thought was addressed to me. I liked the feel of her scheme as it seemed to me at the time: hard, intense and angular, achievement through energy and striving, power, glory and heroism. It was a gut feeling, a sensibility--I hated soft. I also believed that Capitalism, the untried ideal, if it were ever implemented would not only raise all ships but give me the chance to exert myself to the fullest and achieve glory.

Then one day when I happened to be awake during American History class, I learned about Market Failure. Mrs. Paul nee Miss Weiss (she got married during the term I was in her class) lectured on the Great Depression. She described how farmers plowed under mountains of grain while people in the cities were starving because it couldn't be any other way. If there were an oversupply of grain farmers wouldn't get a decent price for it and they would starve, so they buried it and everyone was worse off. That and all the other vicious circles ground round and round and things became worse still. It made perfect sense and absolutely no sense at all: all the stuff people needed was there--there was no shortage of food, land, water or natural resources but people were badly off and there was no way out. The disaster was man-made but couldn't, in any way that I could see, be unmade since everyone was behaving rationally.

That was when Morality grabbed me by the throat and shook me until until my eyes bugged out--like my lab worrying his stuffed koala. Before then, as an aspiring New Intellectual I thought I knew all about Morality and was convinced that it wasn't for me: Morality was a matter of making oneself worse off so that others could be better off and I didn't see any reason why I should do that. Mulling over this puzzle it seemed that everything I'd believed was washing away from under my feet: flawless rationality generated the most absurd, pointless waste and not just accidently but with the inexorable a prioricity of a proof in geometry. I realized that Ayn Rand was wrong. But I got a D in the course anyway.

It's still those man-made disasters that get under my skin. News of the tsunami in South Asia, dead children, villages destroyed doesn't grip me in the way that the stories of ongoing war, lawlessness and corruption that ruin people's lives and whole societies do. I remember reading somewhere that Indian pashas became fabulously wealthy because British colonialism freed them from the duty of burning up their resources through socially obligatory warfare. It's the nature of Nature, blindly irrational, to be red in tooth and claw. We can't complain, but just fight it for all we're worth. It's the irrational results of human rationality that haunt me.

The linked article from the NYTimes rehearses that theme--how nations and cultures collapse under their own weight, how the Norse in Greenland and the Mayan elite made rational self-interested decisions that destroyed them and wiped out their civilizations while, predictably, the Germans and the Japanese planned, regulated and flourished. Will we ever get it? The author bravely but without much conviction thinks that we might since, unlike the Mayan kings, Easter Islanders, Norse Greenlanders and Mangarevians we have the benefit of the Historical Perspective and his books.

I'm not convinced because I don't know many people who spend their time worrying about the Mangarevians or have a clue about the Historical Perspective. Most policy makers don't seem to get it either and even if they do they have to answer to voters who don't.


WildMonk said...

H. - Glad to see you are posting more!

I'll bite on this one...where do you see that natural limits of planning and regulation? Clearly Soviet style planning was enormously destructive to the USSR's economy as no one had the breathing room to create the wealth on which successful societies thrive. On the other hand, while knee-jerk market fundamentalism might lead to better growth it may also, as your examples point out, lead to "rational" microeconomic activities that spiral into irrational macroeconomic effects (not to mention unwanted social effects).

In advocating regulation in such open-ended terms, you appear to view regulation as a good *in and of itself*. If widely adopted, however, I cannot see how this would lead to anything but an overgrowth of sclerotic bureaucracies obsessed with propagating meaningless regulations. Much better, I would think, to advocate freedom in general but regulation in specific cases of market failure (fisheries depletion, air, ground and water pollution, retirement fund protection, etc.). Done right, this would intelligently address market failures while otherwise leaving people alone to work and thrive. I would also hope for an "empirical" approach to regulation: a willingness to suspend regulations that harm more than help as long as the balance of harm wasn't simply being "spun" to benefit moneyed interests.

Finally, I'd hope that Mrs. Paul spoke at least passingly of the enormous distortions introduced into the American economy in the opening years of the great depression by deflationary monetary policy, the Smoot-Hawley tariffs, etc. These set up a macroeconomic framework (or arguably a *regulatory* regime) under which many of the microeconomic behaviors you decry became "rational". Again, I do not disagree with your fundamental thesis but I fear that Mrs. Paul's lesson may have been such a revelation that it acquired a meaning beyond that actually warranted by history.

Best regards,


H. E. said...

I'm not an economist (too dumb at math) and don't have any a priori views about the limits of planning--seems to me that it's all an empirical question about how you organize things to get the best result. I do have a priori views about what the best result is--along the lines of maximizing effective freedom to attain preference satisfaction--but that's problematic and too hard work at this point to negotiate about it.

If centralized, planned economies produced the result I'd say fine--but manifestly they don't and in fact they're disastrous. If laissez-faire did I'd say fine but it can't, not only because of problems with commons like fisheries, ground and water pollution but because the luck of the draw leaves lots of people without many bargaining chips or options. Even when the market works, women and minorities, and people who are just stupid, incompetent, crippled, unlovely or unlucky get the short end of the stick.

It's really not clear to me that the costs of regulation, which restricts employers freedom to hire and promote whomever they please and to indulge their tastes for discrimination, outweigh the benefits of enforcing equal opportunity regulations for women and minorities, or that the cost in taxes to provide for people who are stupid, incompetent or unlucky outweigh the benefits to people who have just lost out in nature's lottery. I'm not even talking about fairness here--just maximizing.

Please note, I didn't make the interesting, controversial and thoroughly implausible claim that regulation was in and of itself a good thing. I just made the boring but I think plausible claim that the absence of all regulation isn't going to guarantee the greatest good for the greatest number.

WildMonk said...

This is a pretty good statement of my sense of reasonable politics as well:

"maximizing effective freedom to attain preference satisfaction"

However, I'd bet that there is still some difference in opinion since the definition of "freedom" has been in play ever since Marx wrote:

"This kind of [capitalist] individual liberty the same time the most complete suppression of all individual liberty and total subjugation of individuality to social conditions which take the form of material forces - and even of all-powerful objects that are independent of the individuals creating them." [Marx, Grundrisse, pp. 131]

I'm sure that you are familiar with the logic: freedom is not really "free" without the resources to satisfy one's basic needs. This conflates two things, though: freedom and security. I think it most useful to speak clearly of freedom as a negative right and to separately defend and articulate a fundamental theory of "social" security: what is reasonable to expect of society in providing for the less fortunate? We needn't hitch ourselves to the power of the term "freedom" to build a theory of a good society!

Of course, I also violently disagree with Marx's position that a "complete suppression of all individual liberty and total subjugation of individuality" follow from Capitalism. It just hasn't been borne out by our actual experience of Democratic Capitalism and, indeed, seems far more characteristic of systems explicitly built atop Marxist ideas. My sense is that you would agree.

But you don't need Marx - or any other of what I have called Rousseau's hydra - to argue for a defensible theory of the social good. It is available within the bedrock from which both the enlightenment and the counter-enlightenment sprang: Judeo-Christian ethics. That is why I am bewildered with how completely modern liberalism has been hijacked by the hard left (whose roots have spawned egregiously tyrannical societies and whose economic foundations have been uniformly discredited - i.e. the labor theory of value). Why did it not embrace liberal Christianity and formulate a theory of social justice based on their far better developed theory of human nature? Why are the humanities dominated by people who despise Christianity and who preach (I use the word purposely) the kind of post-modern irrationality that leads them nihilism and cynicism instead of hope and compassion? Is it really that much fun to pretend that you understand what the hell the German counter-enlightenment thinkers were saying? When Stanley Fish insouciantly declares that he doesn't need to be "right" just "interesting" - is he really so *cool* that we all feel the need to be like him? Is it all just *fashion*?? (OK, OK, I'm calming down now...)

There is hope, at least, in the "New Humanists" like Steven Pinker who are trying to re-ground intellectual life in reasonable models of human nature and consciousness. If there is any hope of transcending the conservative/left-liberal propaganda wars and building a common theory of a good society, I think it will come from that direction. Of course, I may just be biased since my degrees are in Cognitive Science as well (I'd say "my work" but I left research a decade ago so it doesn't apply). Some means for synthesizing an explicitly rational Humanism with a post-reformation, liberal Christianity seems to me a far more appealing and stable foundation for building a wise society than the post-modern freak show that turns out to protest "globalization" or "capitalism" every time some government ministers meet.

Well, that was a bit longer than I intended...

P.S. My apologies if I read you a little more pro-regulation than you intended!

H. E. said...

Is it really that much fun to pretend that you understand what the hell the German counter-enlightenment thinkers were saying? I don't pretend to understand this stuff or know many people who do. I do have a colleague who has actually read Marx but he seems to think that when correctly translated into English he turns out to be Rawls. The humanities are not dominated by people who're into German counter-enlightenment nihilism, contrary to the impression you may get from a few literati who've been adopted as public intellectuals.

When I say "freedom" however I was in fact talking about what I suppose Marx had in mind rather than political liberty which, along with basic resources, is a prerequisite for effective freedom. I mean capability as Sen understands it.

Political liberty is a prerequisite but doesn't go that far in promoting effective freedom or if you will capability because the operation of the free market de facto locks lots of people into situations where they don't have much capability. If I'm stuck in one (or two!) of those crappy jobs Barbara Ehrenreich describes in Nickel and Dimed in America I'm not free in any sense that contributes significantly to my well-being.

Everyone has to trade off some effective freedom some of the time for other goods, including more effective freedom at other times. I take plane trips to conferences and sitting on a plane is the quintessence of being unfree--trapped in a restricted space with very little you can do. But I can at least read and when I get out I'll have lots of fun. For most people work is like a daily 8 hour plane trip where, in addition they can't read, drink or take knock out pills to get through it because they're stuck doing repetitive tasks--scanning groceries, inputting data, etc. and there's no fun at the end of the day because they're brain dead, don't have the resources to do much and, if they're women, work a second shift.

You can't eliminate this shit work--someone has to scan those groceries, input that data, take phone orders, work on the assembly line and do routine clerical work--but you can fix it so that people can make trade-offs, invest in education at any time in their lives to get out, get a chance for advancement on the job, have a decent working environment and, at the very least, decent wages so they can have a few more options during their leisure time. That's what government regulations, income transfers and social programs are for because without government interference you get Walmart.

WildMonk said...


Thank you for responding! I agree in broad outline with what you are saying. I would, however, ask you to take a look at this criticism of Ehrenreich's book:

Its not that it "proves you wrong" (I don't think that you are wrong) but I don't think that Ehrenreich's analysis is fully honest either. I look forward, in turn, to reading the website (Sen's work) that you linked to.

I don't worry a bit about the 20 year old working at the crappy job in the supermarket because I can guarantee you I did worse (such as inspecting the plastic Cool-Whip bowls coming out of the stamper on the Midnight to 8:00 AM shift). At 19, honestly, it wasn't so bad.

I do worry about the single 40 year old Mom who thinks Waitressing is her only career option as she struggles to support her 3 children. Ehrenreich and other critics of Capitalism very often gloss over the difference between the two. I think it entirely reasonable to ask people to climb a ladder: to work the shit jobs as they build the skills needed to move into a more autonomous, better paying position. It makes no sense to me to pretend that everyone should be secure and comfy the moment they enter the workplace. In some ways, I guess this makes me "hard" in the sense that you said you once were.

To make my ideal work, however, *there must be a ladder.* And yes, I know that her point is that the ladder is beyond reach for many Americans.

Her critics on the right point out that people really are expected to climb: to be on time, to work hard, not to steal from your employer, etc. They also point out how much harder you make life if you drop out of high school, get convicted of a crime, get pregnant at 16, or engage in recreational drug use.

It's easy to find millions of people who don't follow these rules and who end up living very difficult lives. When the left points to these people as evidence of the failure of the system, the right rightfully feels that this is "cheating" the argument. Talk to most people with blue-collar jobs and they'll agree. This is part of the reason that Democrats keep losing elections when they point out economic failures in America.

The point is that the left *isn't* always cheating: there are people who have tried to climb and who just seem to be unable to do so. There *are* economic forces that throw thousands of people out of work so a company can send work to the third world for cheap labor. How do you address these obvious shortcomings without creating a system that also serves as a magnet for the lazy, dishonest and sleazy?

Any reasonable theory of a good society must address the fact that it is often times the purported victims that are at the root of the pathologies we see in Capitalism and not the system itself. I think it was E.O. Wilson who once said of Communism: "great theory, wrong species." The human species will inevitably drag down any system that doesn't impose negative outcomes for negative behaviors.

A quick story: I run a small business creating health and wellness software. A few years ago I hired a women - about 30 with one child and no Dad - and gave her a very nice position with varied duties and a real opportunity to become my right hand assistant. She had a professional appearance, spoke well and had every opportunity to really build a career. She started at $32,000. It is no exaggeration to say that with the right approach she could be making $60,000 to $70,000 a year right now if she'd worked hard and eventually moved into sales (her expressed long-term interest).

The result? She simply couldn't do it. She lied about her hours to cheat me on wages, accused me of guaranteeing her a raise within six months (I didn't) and spent hours on the phone with friends (strippers, drug dealers, you get the picture). When I let her go, she spread the word in town that my wife had demanded her firing because she was jealous of her beauty. And this is in the most laid-back, fun office you can imagine.

How do you fit this woman in any theory of a just society that only sees fit to criticize the Capitalist class? Hell, I even gave her an extra thousand dollars one summer to help her with child care when school ended. Not only had she lied about needing it (her mom took the boy for most of the summer) she then accused me of cheating her when I placed the money on her official paycheck (she apparently didn't want to pay taxes).

I'm sure that I would be every bit as liberal today as I was when I was in grad school if I hadn't spent the last 14 years hunting up my own living and hiring real-world employees. So now the question for me becomes one of how to avoid falling into the trap of creating models of society that are idealistic and inspiring but that are flat out wrong because they don't address the deficiencies in *people* as well as the flaws in Capitalism.

Whew. Again, that was longer than intended. I hope it all makes sense. I had wanted more to address your point about the humanities being filled with people who were into counter-enlightenment Germans but I guess it was more fun to go on with personal experiences.

One point I should clarify: the comment about German thinkers was that, from the outside, it sometimes appears that "what's fashionable" often seems more important than "what's right." I really don't expect that you hear a lot of German counter-enlightenment nihilism in the hallways of academe but it sometimes seems that the relativism, the "will-to-power" mentality of speech and behavior codes, and rampant hard-left rhetoric, etc. harkens back to counter-enlightenment ideals more than enlightenment ones. Not being in academia, I'd love to hear your take on that.

WildMonk said...

You know, in many ways, I didn't address your issue. Here's my point: the left needs to stay scrupulously honest in its critique of American economic policies and practices. It needs to be fair, to acknowledge advantages found in our form Capitalism as well as problems, to recognize gains from economic progress *and* well-thought out regulation, and to exude a sense of optimism even in the face of setbacks.

If Americans perceive that data are being cooked to bash America or Capitalism in the abstract, then they'll tune out the left. If, however, you respect the truth and have faith that the truth will come out, if you address that sometimes these issues are really hard and that it isn't as simple as just raising taxes, then I have faith that your voice will be heard. Progressive voices were rightfully heard in the 20s-60s and society changed for the better in many ways. Create a mature, realistic model of the world and a plan for making it better and I'm sure the American people will follow. I really don't believe they all want a WalMart world.

H. E. said...

I appreciate your personnel problems and I agree (and hit your link) that Ehrenreich's book is somewhat sensationalistic. Critics have noted that most women in the position she simulated would have a local support network, wouldn't be forced to live in motels and would probably stay put rather than moving around the country.

But Betty Dukes, lead plaintiff in the Walmart class action case, stable, hardworking, and a pastor in her church was quite a different kettle of fish. She's suing on behalf of 1.6 million women working at Walmart, many of whom were equally hardworking. Management denied them promotions and paid them low wages in spite of all their efforts because they could. This isn't a matter of personal malice or patriarchal conspiracy--it is the market working. If "women's jobs" are overcrowded and women don't have access to jobs outside of the pink collar ghetto, as they don't without the enforcement of equal opportunity regulations, then employers can hire them at low wages and deny them promotions.

More generally, firms like Walmart that hire lots of non-union unskilled labor can pay low wages and impose harsh conditions because high turnover doesn't cost them. There's an endless supply of cheap labor and the costs of hiring and training are low compared to the costs of providing the wages, working conditions and opportunities that would motivate workers to stay. No one is being mean--just rational.

Walmart is precisely the market working. It's efficient, it extracts the most work from employees at the lowest cost, and so can sell stuff for less so consumers, being rational, will shop there. No one wants Walmart but without government interference Walmart is what we're all going to get.

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