Category: Modern Society

Coronavirus and Shutdowns

I am writing this on March 17, but by the time you read it, the world will have changed. It is changing by the hour. One week ago, the college where I work shut down. It has been a rather chaotic week, to say the least. But, before this crisis morphs into whatever it will become, it is worth recording a couple of observations.

First, the details. I am a professor of economics at Mount Holyoke College. Last Monday (March 9) at 3:45 pm, the college sent out an announcement restricting travel and the size of campus meetings. On Tuesday (March 10) at 5:30 pm, we got another announcement saying that the campus was shutting down. Technically, we didn’t close; the students were told that they needed to leave campus by March 20 and that all courses were now going to be online. Since all of the students live on campus, the eviction notice affected everyone. None of our classes are online, so every course was also affected. This decision obviously raised a large number of logistical questions. On Wednesday (March 11), there was a Faculty Forum in which the President and Senior Staff, looking quite haggard, answered questions about the decision. There has subsequently been a steady stream of announcements covering assorted details.

Since last week, not only have other colleges shut down, but many other types of business and government offices have followed suit. Let me be very clear at the outset: this essay is not an argument about the shutdowns themselves. That is a question which will be discussed for decades. There are, however, two other societal questions about which the experience of the last week at one liberal arts college provides insights.

Read the rest at Public Discourse

The Cursed Lust for Gold

Gold is once again all the rage.

Actually, come to think of it, it is hard to remember when gold wasn’t all the rage. Virgil talks about “the cursed lust for gold.” And let us not forget King Midas (or his most unfortunate daughter).

Why gold? Sure it is a shiny pliant metal, useful for making flashy jewelry. But, that isn’t enough to explain why coronavirus fears would send the price of an ounce of gold skyrocketing—surely you don’t think there has suddenly been a big increase in the demand for gold jewelry, do you?

The allure of gold has little to do with its use in decoration. Gold has the allure of being something like money. Money is really useful; with enough money, you can buy whatever you want. Gold feels like some sort of supermoney, a safe money, a money that you can rely on. You can make a big pile of gold and dive right in and revel in the tactile feel of the shiny metal. Well, you’ll enjoy that last bit if you are Scrooge McDuck.

Is gold actually like money? Not anymore. In 1971, the United States abandoned the even the pretense of being on a gold standard. That was the last link of any actual connection of gold with money. Five decades later, this still surprises people. If you have a gold coin and want to exchange it for money and you take it to your local bank, they will just laugh at you. (Well, your banker probably won’t actually laugh because I am sure your banker is nice.) Banks deal in money, not gold.

Gold is now just a metal which can easily be melted down and turned into little disks if you like your metals in shiny round circles. You could make little squares or triangles or octagons of gold too, but they are not as popular; people really like it when their gold is a circle. Why? Why do people still think of gold as something like money?

Enter James Ledbetter’s One Nation Under Gold: How One Precious Metal Has Dominated the American Imagination for Four Centuries, which was clearly competing for longest subtitle of the year.

This is an extremely good book. It is in that genre of books where someone picks a commodity and tell the history of the world as reflected by that commodity. So here we have the history of the US through the lens of gold. If you like history books, this book is really fun. I have read lot of US history and I have read a lot of books about money and I still learned a lot from this book. (My students also liked it.)

My biggest surprise: I knew that once upon a time private gold ownership was banned in the US. I never learned why. It was just one of those strange mysteries that nobody ever covered in a normal history class, and there was no point in covering it in a money and banking course, and I never got around to looking it up. Why make it illegal to hold gold?

The answer: it happened during the Roosevelt Years (FDR, not Teddy). Before that, the United States was on something resembling a gold standard, which meant if you had $20.67 in US currency, you could take it back to the government and get an ounce of gold. ($20.67 is the actual number—I know it looks like a made up number, but it’s not.) Well, in theory you could redeem all your currency for gold. The US, like every other country on the gold standard, started issuing lots of extra currency and there was no longer anywhere near enough gold to redeem it all.

Then the Depression (the Big One) hit and the government started getting concerned that people might actually start swapping their money for gold. So, what do you do if you are worried that people will exchange the currency for gold but you also want to pretend you are still on the gold standard? Easy. Make it illegal to hold gold.

See how brilliant that is? The country is still on a gold standard because all the currency is backed by gold and you can exchange your currency for gold any time you want. But, it is, of course, illegal to hold gold. So, even though you are perfectly free to exchange your money for gold, you’ll then be arrested for illegal gold possession, so maybe you don’t want to make that exchange after all. Sometimes you do have to step back and admire human creativity.

The strangest part of this episode came much later: when the US went off the gold standard, it was still illegal to hold gold for another 3 years. Eventually people began to realize how silly it was to prohibit people from holding a lump of metal that had zero connection to the monetary system. The fact that it took 3 years to realize this, shows how deep the mystical nature of gold penetrated the American psyche.

A side note: if you did want gold in those days when it was illegal to hold it, there was one country that manufactured lots of gold coins. This is when South Africa was able to make the Krugerrand into the status symbol for the rich people who wanted to engage in borderline illegal activities. When you watch old movies or read old books and see people talking about Krugerrands, this is why.

Once the US went off the gold standard and it became legal to hold gold, then there was no longer any reason to think of it as a special commodity, but of course people still do. So, it times of trouble, when people want a safe asset, they automatically think of gold. It will be interesting to see how long that will last.

There are still occasional arguments that the US should go back onto the gold standard. The basic reason for the argument is that the Federal Reserve can’t be trusted to maintain control of the money supply. But if you want control of the money supply, gold is also a really lousy choice—after all, your money supply is then dependent on the activity of gold miners.

It also isn’t really all that obvious that many people liked the gold standard back when countries were on it. Having gold be the unique money is a relatively recent innovation—go back a few hundred years and all sorts of metals were used as money. Even at the heyday of the gold standard, there was constant agitation to also have silver be used as a money. You knew that—think about William Jennings Bryan’s immortal speech at the Democratic National Convention:

If they dare to come out in the open field and defend the gold standard as a good thing, we shall fight them to the uttermost, having behind us the producing masses of the nation and the world. Having behind us the commercial interests and the laboring interests and all the toiling masses, we shall answer their demands for a gold standard by saying to them, you shall not press down upon the brow of labor this crown of thorns. You shall not crucify mankind upon a cross of gold.

Ledbetter adds:

With these final lines, Bryan pressed his fingers against his temples to illustrate a crown of thorns, and stretched his arms out perpendicular to illustrate a crucifixion—a pose he held for a full five seconds. After a moment of stunned silence, the hall exploded with cheers.

A rather effective bit of rhetoric.

Nationalists vs Globalists vs Tribalists

The Virtue of Nationalism by Yoram Hazony was the book of the moment after it came out. It even won an award for being the Best Conservative Book of the Year! So, it must be good, right?

Obviously if you are a liberal, you might not like or agree with Hazony’s argument, but the book at least must be a good book, right?

If you look at the title and the cover blurb and Hazony’s shorter essays, it is not hard to see why conservatives loved this book. Hazony sets up the contrast between the nationalists (good) and the globalists (bad). The globalists are those liberals who really want to run the world by creating all sorts of international rules that will stop all those deplorable little people clinging to God and guns. The UN and the World Bank are globalist. So is the EU.

The Nationalists on the other hand are the good noble people who care about their own people. They don’t want international bureaucrats telling them what to do. Brexit is a nationalist triumph. The rise of all sorts of politicians in country after country who care about their own nation is also a good thing. They stop the globalists running roughshod over the nations.

Now, I know what you are thinking. Nationalists are bad. Why do you think that? Well, the Nazis were bad, right? And they were nationalists, right? (That is the N in Nazi after all!) Ah, but Hazony cleverly notes. The Nazis were…globalists! The Nazi moment was when the Germans decided to take over all the other nations and tell them what to do. Just like the EU!

And now you see why conservatives love this book. Nazi=EU=Clinton! The thesis of this book is indeed what a particular slice of conservatives desperately wanted to have. It is perfect, perfect!, for those high-brow Twitter debates.

Then I read the book with one of my reading groups. The conclusion: there is no possible way that any of the judges for that Conservative Book of Year award actually read this book.

Don’t get me wrong. I am entirely sympathetic to the argument that the globalist crowd are doing vastly more harm than good. I am very sympathetic to the argument that nationalism is not inherently a bad thing, that it is a viscous calumny to equate nationalism with hatred, racism and intolerance.

But, with friends like Hazony…

Hazony’s argument runs as follows. We are not individuals; rather we are born into clans. You don’t get to pick your people (your immediate family and other more extended relations). Your clan has a loose affiliation with other clans based on mutual loyalty. These group of clans, called tribes, have good and bad things about them. We could organize society with tribes as the distinguishing unit; this is what Hazony dubs the anarchical order

But, there are some people who want to unite everyone in the word under a commons set of rules. These are the proponents of empire. Empires don’t care about tribal differences; they want to erase them in some grand superproject in pursuit of fairness or justice or some other goal.

Anarchy and Empire are both bad. What is good? National states. Nations are collections of tribes in mutual harmony. They inherit all the good things about tribes and none of the bad things. Nations are also concerned with fairness and justice and so inherit all the good things about empires but none of the bad things.

In other words: nations are good by definition. If a collection of tribes does not improve things, then that collection of tribes is by definition not a nation. It would be an empire.

Globalism then by definition is bad. It tries to unite nations in a way that is not built upon mutual loyalty and does not improve things for all the tribes. By exactly the same logic, tribalism would by definition be a bad thing…but curiously, Hazony never defines tribalism or warns against it. I think that would be off message. Globalists are the bad guys in this book.

The rest of the book is thus an exercise in tautology. If nations are good by definition then Nationalism is good and virtuous by definition. The key to understanding the argument of this book is simply to remember Hazony is right by definition and if you disagree with him, then you are wrong by definition.

So, take the Nazis. Nazis are bad, right? We all agree about that. So, the Nazis can’t be nationalists because nationalists are good by definition. Thus, when the Nazis try to take over Europe, they are not uniting the German people into a single nation, they are acting as globalists trying to make other nations bow to their will.

Now, here is a test for the reader. Who was right in the American Civil War? The South asserting its right to be its own nation against the globalist tendencies of the North? Or the North asserting that the North and South form a single nation? Easy! The South had slaves; slavery is bad; so the North was right because if the South seceded then the evil of slavery would have continued and the North would have been a weaker nation, so the South has no right to self-determination. I know you think I am making up this argument. But, here it is in Hazony’s own words:

He [Lincoln] needed only to look at the biblical account of the fratricidal wars between the kingdoms of Israel and Judah, which in the end weakened both of them and paved the way for their destruction, to see the future before him. And this future, together with the evil of allowing slavery to endure in America forever, did indeed justify denying national self-determination to the Confederacy. The reasons for distinguishing the case of American independence from that of Confederate independence are thus not to be found in the way we define what a “nation” is, or in the way we formulate a proposed universal right to national self-determination. The cases are distinguished only in the balance of moral and prudential considerations of supporting or opposing independence in a particular case.

See how easy this is? When the rule becomes simply if Hazony thinks it is good, then it is by definition a nation and if Hazony thinks it is bad, then it is by definition either globalist or tribalist, then it is really easy to figure out why nationalism is good.

I had a merry time arguing Hazony’s point with my students. But, honestly, as fun as it was, it was a pretty hard argument to sustain. The EU is bad; the Nazis are bad. That part is easy. But, then my students (who are annoyingly clever at moments like this) started asking questions like this: should Hawaii be a part of the United Sates? Should Scotland be in Britain? What about Ireland? Desperately, we can look back at Hazony’s definition of a nation:

By a nation, I mean a number of tribes with a shared heritage, usually including a common language or religious traditions, and a past history of joining together against common enemies—characteristics that permit tribes so united to understand themselves as a community distinct from other such communities as their neighbors.

Using that definition, distinguish between England/Scotland/Wales/Northern Ireland; the continental United States/Hawaii/Alaska; and Belgium/Netherlands/France/Germany/Italy/Greece/and the rest of the countries in European civilization. Which combinations can be united into a single nation? Well…uh…have I mentioned that the EU is really bad and they are a lot like the Nazis?

I know what you are thinking. Surely there is some principle here on which Hazony is building his theory, right? It can’t be this shallow, can it? Surely, Hazony’s argument could address a simple problem in international affairs. My nation wants to rule over your tribe. You don’t want to be ruled by me (for some unfathomable reason). Do you have the right to be independent from my rule?

Here is Hazony’s principle: “the order of national states is one that grants political independence to nations that are cohesive and strong enough to secure it.” (Italics in original, so you know it is important!)

OK, what does that mean? Is your tribe a nation? How do we find out?

Whether a people should be supported in a bid for independence is a determination that must be made in consideration of a number of factors, including the needs of the people in question; the degree of its internal cohesion and the military and economic resources it can bring to bear; its capacity, if continued as an independent national or tribal state to benefit the interests and well-being of other nations; and the threat that this people, once independent, may pose to others.

Yeah, Hazony really wrote that. So, when I determine that my military can roll over your military then it is obvious that you do not have the military resources to protect yourself and thus you do not merit independence. When I determine that your nation does not benefit my interests and well-being, then you do not merit independence. When I determine that your nation poses a threat to my people, maybe the threat of your bad example, then you do not merit independence. And then when I determine that the needs of your people will be better met by my rule, then you don’t merit independence. So, what exactly was the problem with globalism again?

In the end this was a ridiculously frustrating book. I really wanted to like it. I liked the idea of a book demonstrating that the globalists do not have the moral high ground. But, Hazony’s argument was ridiculously sloppy. Hazony should have stuck to the 2000 word version of his argument so I could have at least imagined that there was a cohesive longer version.

Is Economic Analysis Just a Weapon in Public Policy Wars?

How Public Policy Became War, a recent book by David Davenport and Gordon Lloyd, documents one of the reasons why political debate has degenerated over the last few decades.

Faced with a problem—any problem—the political instinct is now to declare war.

Presidents of both political parties have declared wars on crime, drugs, poverty, and terrorism. Davenport and Lloyd note:

At first blush, one might think that declaring war on intransigent problems such as poverty or crime would be a good thing. As these domestic policy wars have evolved, however, five conclusions become relatively clear: (1) they do not generally solve the problem at hand; (2) they create roadblocks to better policy solutions; (3) they increase executive power at the expense of Congress; (4) their imagery is often negative and destructive; and (5) they never end. In a larger sense, these domestic policy wars also contribute to the contentious policy and culture wars that have plagued Washington in recent years.

Like many a thought-provoking book, this one answered a seemingly unrelated question I have long been pondering. Bear with me a minute on what will seem like a complete change of topic.

Read the rest at Public Discourse

Too Good For His Own Good

DC Comics has of late received a well-deserved reputation for making some very bad superhero movies. It’s not entirely their fault.

Who is the greatest DC Superhero? You only have two choices: Batman or Superman. You probably picked Batman. And there is the problem.

We can call it the Superman problem. Superman is, to put it mildly, a bit overpowered. He has extraordinary strength, can fly really really fast (not just faster than a speeding bullet—faster than light), has impermeable skin, X-ray vision, heat vision able to burn through just about anything, cold breath able to freeze just about anything, superhearing, and just in case that isn’t enough, he can hold his breath for a super-duper long time. Weaknesses? Well, just one. His X-ray vision does not work through lead.

Oh yeah…and kryptonite. A green rock which instantly reduces Superman to complete and total helplessness whenever he gets near it. Fortunately, kryptonite is extremely rare on Earth, so people can’t just get some whenever they want to thwart Superman. Also fortunately, despite the fact that there is so little kryptonite that nobody can just go get some, there is always some available whenever the plot needs Superman to suddenly get weak in order to provide some drama to the situation.

If you have a Superhero who is literally indestructible and has a massive array of offensive powers at his disposal, how do you write a story for him?

Batman is easy. He has no superpowers, just a lot of toys. He is dark, brooding, and psychologically interesting. It is easy to create intricate plot situations for him.

That is the DC problem: the most superpowerful of all their superheroes, the superhero everyone knows, is just too powerful to figure out how to craft a plot around him.

Or so I thought.

Then I read Superman: A Celebration of 75 Years. I had not read many old Superman comic books because I was convinced they would be rather dull and repetitive. Villain comes along, Superman shows up, kryptonite shows up, Superman finds way to get away from influence of kryptonite, bad guy loses. Lather, rinse, repeat. What could be interesting about that?

What I found instead in this book was a marvelous set of rather fun stories. The fun part was not the drama of watching Superman figure out a way to beat the villain. That is part of the fun of a Batman story, but plays very little role in providing the enjoyment of a Superman story.

What makes Superman so interesting? He is a really good guy. Really good. He stands for Truth, Justice, and the American Way. Bad things come along and here is this absolute paragon of virtue who never wavers. He just does the right thing. Over and over he does the right thing. Someone is in danger, he helps them. Someone has an evil plan, he stops them. Nobody dies. Good wins.

Why isn’t Superman the most popular Superhero of all with endless amazing movies about him? Because of the answer to this question: Do you want the heroes in your story to be good?

The antihero is all the rage these days; a morally reprehensible person who does good things for all the wrong reasons. The morally tortured hero is also all the rage these days; the hero who wants to do good but has some character trait causing an internal moral tension. Interesting superheroes have flaws, right?

So, imagine a superhero who is strictly Good. He is Just. He cares about Truth. He fights for the American Way. Ok, that last one instantly raised your hackles. Who talks like that today?

So, set aside the American Way bit for a second. Superman is perfectly Good and fights for Truth and Justice. Would you like to read a bunch of stories about a guy like that? No wonder DC can’t figure out how to make a decent movie with Superman in it. Who wants to watch a movie where the hero is Good and Virtuous?

In other words, the reason Superman stories are so hard to craft has nothing to do with the fact that Superman is so powerful. The problem is that he is so good. It is easy to write a story where this incredibly good and virtuous hero does incredibly good and amazing things. If it made us happy to see good triumph over evil, to see selflessness rescue people from tragedy, then Superman stories would be as good as we can get.

Superman is, in other words, a role model. You would never tell people they should be more like Batman or Deadpool. But, being more like Superman would be highly commendable. He is selfless, always helps others who are in need, always stands up against evil and injustice, always cares about Truth. He is the very model of the good person, the good citizen.

Indeed, Superman is such a fantastic Role Model, you might even want to set him up as your National Hero. Let’s identify his goodness with the country. Let’s say Superman fights for Truth, Justice, and the American Way. Let’s set this as our aspirational standard. We want a nation that is good enough that Superman could be our National Hero.

We do have National Days for everything else, so I hereby propose that Congress pass a law making Superman the official Superhero of the United States. Then they should declare a day to be National Superman Day. On that day, we all celebrate by being good to one another. Any objections?

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