The Gonzo Social Scientist

our president

2011-02-16T11:22:00.000-08:00

I'm curious about your political science perspective on this.

Is our president a neo-Hooverite or a masochist? I just don't get it. On the one hand he's a decent arbitrator but on the other he seems like such a weakling. It seems like everything is a losing battle for this administration. Like a nightmare of multiple catch-22s that are all self-imposed.

I remember John Stewart a year ago saying something to the effect of: "I can't decide if he is the Zen master or just out of touch"...

TELL THE DEFICIT TERRORISTS TO SHOVE IT

2011-02-11T13:35:00.000-08:00

With the pandemonium set to be amplified soon with the coming political question of raising the debt limit in the U.S., I thought it would be good to quell some myths surrounding how our monetary system works.

First of all, contrary to the retarded narrative we hear constantly spouted off by media figures and old white men in both political parties: there is no risk of default for the U.S. federal government. A sovereign nation who is the monopoly issuer of a fiat non-convertible currency with a floating exchange rate can NEVER BE INSOLVENT with respect to obligations denominated in that currency. The government can always meet obligations, interest or transfer payments for social security, etc. The reason why there is a connection between the deficit and debt issuance is that there is a SELF-IMPOSED POLITICAL CONSTRAINT that makes conservatives (neoliberals across the political spectrum) feel better. It is a relic left over from the gold standard Bretton Woods days that spending needs to be ‘financed’. There is no underlying economic reason why the U.S. federal government needs to ‘borrow’ to finance any spending. Let me repeat, the federal government of the U.S. can never go bankrupt or default because of the way the monetary system is set up.

But what about hyperinflation? Yes, inflation could be a constraint. However, there is no empirical connection between deficits and inflation. Japan is case in point on this! Furthermore, in the U.S. we have plenty of excess capacity and underutilized resources (high unemployment) which can soak up nominal spending. I think the inflation risk is really low for the U.S. I’ll believe it when I fucking see it and if we do see some it will be due to rising input costs not government deficits.

But what about ‘devaluing’ or ‘debasing’ the currency? There is no empirical link between deficits and depreciation of a fiat currency. Japan again is case in point.

But what about rising interest rates? The Central Bank controls interest rates. How could they explode out of control? That’s right, they won’t.

But what about rising future taxes? Spending by a government who issues a fiat non-convertible currency under floating exchange rates does not need to be ‘financed’ either by borrowing or by taxes. There is no external constraint. If you examine the balance sheets of the consolidated government sector (in our country the Fed and Treasury) you can see that this is true. The government spends first and taxes later. Furthermore, Ricardian equivalence is patently false.

There is absolutely no need to balance the budget like a household. The government which issues a fiat non-convertible currency under floating exchange rates is NOT like a household or firm. The analogy with a household is a fallacy. I think people propagate this fallacy in order to play political games, cause citizens to fear things that don’t exist and generally to further their neoliberal ideology of decreasing the role for government. It is a self-defeating and self-destructive position to take. Deregulation and desupervision of the financial institutions has led to fraud and a credit bubble and now cutting government spending will kill any chance of private sector recovery from the credit binge. I.e. the private sector cannot deleverage without a government sector deficit because in the U.S. there is a current account deficit (imports are greater than exports so there is a leakage there).

But what about all the money we owe China? GOVERNMENT DEBT IS A PRIVATE ASSET. Our children don’t have to ‘pay back’ shit for the above reasons. Note how recently private sector saving has risen while the public sector (consolidated government) has gone into deficit. The government deficit is facilitating private sector deleveraging (paying down debts). The neoliberal period has seen an explosion in private debt and that is a major cause of the global financial crisis.

In conclusion, EVERYONE NEEDS TO SHUT THE FUCK UP ABOUT THE U.S. GOVERNMENT DEFICIT and start working on more important problems such as massive unemployment and persistent ecological destruction. Unemployment imposes huge social and cultural costs, not to mention economic costs.

Cutting government spending will not create jobs! It will make shit much worse and multiply social ills.

The government is the monopoly issuer of a fiat currency and the private sector are the users of the currency. This is a subtle power they have over us but also it creates opportunity for the government through fiscal policy to achieve many goals without worrying about any bullshit ‘financing’ constraint. Politically, we can figure out what those goals are that we want the public sector to take on.

Note that the monetary system is different in the Euro zone where they have relinquished their monetary sovereignty and gone to the Euro (effectively fixed exchange rates) plus agreed to idiotic and arbitrary deficit limits as a percentage of GDP. Those constraints are what necessitated bailouts in Ireland and Greece. Zimbabwe had hyperinflation, but they had major supply-side issues…

Often deficit terrorists citing hyperinflation use Zimbabwe and Weimar Germany as examples of what would happen to the U.S., U.K., Japan, etc. if the government sectors don't cut their deficits/debt.

In Zimbabwe and Weimar there were extraordinary problems on the supply side. Let's start with Zimbabwe. A large part of the story is a hangover from colonialism, but after the ensuing land reforms, agricultural capacity was destroyed. This required shifting to imports which used up foreign exchange which could have been used acquired raw materials for manufacturing. Manufacturing capacity was hardly being utilized (20%). Production collapsed and unemployment rose above 80%. Income growth fell, aggregate demand fell further. GDP growth contracted 7-8% per year causing investment to dry up and potential capacity to plummet. If that wasn’t enough, the government spent money on political favors instead of adding to productive capacity.

Yes, I know that governments suck and everything but though hyperinflation was almost inevitable in this case it provides no intrinsic case against a government that is sovereign in its own currency and who runs permanent deficits to pursue policies of higher employment.

Ron Paul, Tea Parties and American Democracy

2010-05-06T14:25:00.000-07:00

In the aftermath of divisive healthcare debates, conservative and libertarian commentators have taken to bemoaning the downfall of American democracy, if not announcing its imminent demise.

While I don’t have time to address all of their points individually, the overall thrust of the argument – at its most rational – is as follows: the constitution sets sharp limits on the right of government to intervene in the affairs of its citizens, that have been bypassed in the administration’s efforts to pass health care, both procedurally and, more importantly, substantively. Government has only those rights explicitly granted to it by the constitution, as evidenced by quotes from Jefferson, Paine, the Federalist Papers, etc. Therefore, our democracy is on the verge of collapse, and it is the duty of responsible citizens to resist. Those disagreeing are – at best – irrational, and – at worst – socialist, fascist, globalist, enemies of democracy.

To frame it another way, this narrative relies on the selective quotation of some “founding father” that is deployed to present a minimalist, libertarian reading of some contested constitutional clause (“general welfare,” “necessary and proper,” “equal protection,” etc.) or theoretical concept (democracy, freedom, justice) as the only legitimate understanding of that clause or concept. From this vantage point, any policy (expanded health care, protections for workers, tightened regulations of financial transactions, etc.) that appeals to an alternative constitutional and/or theoretical understanding is undemocratic and dangerous.

There are, however, three problems with this narrative. First, it fails to recognize the diversity in the thought of “the founders,” which relates to the perennially contested nature of concepts like democracy, freedom and justice. While the founders were concerned about government overstepping its bounds, they diverged markedly in their prescriptions for governmental intervention. For instance, Paine advocated for a welfare state, while Jefferson continually urged the state to act as a check against the rise of corporate power. The appropriate balance between the interests of the individual and the collective – liberty and equality, the “public” and “private” – has, since the earliest political philosophers, been a matter of debate. It always will be. Neither the constitution nor the founders provide a clear resolution here; it is the very essence of democratic politics to adjudicate these debates through representative processes at a particular point in time.

Second, this ambivalence points to certain difficulties in attempting to apply the thinking of 18^th century statesmen to a 21^st century world. How would the founders have dealt with the expansion of corporate personhood? The emergence of transnational corporations operating in a global market? The power of international financial institutions? The myriad questions raised by technological advances? The new challenges of global interconnection? Foundational texts can serve as valuable guides in dealing with these matters, but there exist hermeneutic gaps that are inevitably filled by contemporary debates over constitutional law, political theory and political economics. Today’s oft-heard narrative, however, conveys the impression that one need only give the constitution a quick once-over, and…voilà! The answers to all of our contemporary problems materialize!

Interestingly enough, this interpretation leaves us with a constitution that looks as if it was written by mid-20^th century Austrian economists, not the hodgepodge of late-18^th century worldviews that actually characterized constitutional deliberations. Thus – and this is the third problem – the libertarian position is founded on a conflation of democracy with capitalism that reduces classical democratic concerns of individual freedom, civic virtue and deliberative process to a sterile model of consumer choice, hyper-efficiency and cost/benefit analysis. In such a formulation, to paraphrase Polanyi, democracy becomes the handmaiden of capitalism rather than the other way around. This stems from a libertarian conception of politics in which power exists solely in the “public” realm, and is seen to act upon the “private” – where both individuals and corporations reside. As a consequence, any effort to address social inequality through public education, corporate taxation and regulation, the provision of social safety nets, etc. leads to the doomsday, sky-is-falling scenarios that characterize Tea Party rhetoric. This hyper-economistic vision of politics would be unintelligible to “the founders” (who were mostly classical liberals or radical democrats) and it certainly seems anemic in a period where the capacity of democratically elected governments to implement the will of the populace is increasingly constrained by the power of transnational capital.

Unfortunately, these three components coalesce in a narrative in which civic deliberation is virtually impossible. How can you engage in real dialogue with those who view anyone with an alternative viewpoint as an enemy of democracy? Reasonable, intelligent people can disagree on the appropriate level of state intervention, the use of the filibuster, the proper role of money in politics, etc. What left is there to debate – what point is there to democracy – if there exists some timeless formula that tells us precisely how much intervention is necessary, that describes the exact form the relation between the individual and collective should take, and that universally proclaims certain rights should be privileged over others? Isn’t the continual struggle over these issues the very stuff that democracy is made of?

There is a real arrogance in collapsing questions that have occupied thinkers for two-plus millennia into a narrowly circumscribed sphere where politics is reduced to a mere umpire for the market, and then proclaiming this personal ideology to reflect THE essence of democracy.

What's a politician for?

2010-04-28T16:44:00.000-07:00

The medicinal marijuana reaction-hysteria in Colorado right now is poignant. Quick history: With the new attorney general, the risk of opening a dispensary dropped. Dispensaries proliferated. Even during a recession, these dispensary owners started to make decent incomes. Government started earning sales tax revenue from them. That's should be good right? Politicians should be happy? After all, the public sector is in the hole too in this recession...

No. They are now wanting to shut down 80% of these dispensaries.

Politicians are bringing idiotic anti-weed moral arguments. They want more regulation and control. People are wagging fingers at dispensaries. Why?

Politicians are getting in bed with a handful (the other 20%) of well-capitalized dispensaries. So, it will end up being a big-business-big-government regulation which will screw over the little guys, decrease choice and competition, increase prices and drive more sales into the black market. This is picking and choosing winners!

Why regulate in this case? Why do people care so much about what other people put in their bodies? Why constrain commerce during a recession? Because of a screaming moral minority?

And my libertarian side (and economist brain) was so excited to see REAL competition and freedom in a nascent industry.

DETAILS:

HB1284 Passes

{Denver} -- The Colorado state Senate Local Government Committee took hoursof testimony yesterday on HB1284. One of the bill's sponsors, Sen. ChrisRomer (D-Denver), was quoted in several articles yesterday saying that thebill is designed to shut down 80% of caregiving businesses in Colorado. TheCommittee hearing started at 2pm and finally adjourned at 11:30pm. TheCommittee voted in favor of HB1284 and some of its last minute amendmentsby a vote of 6 to 0, with Senator Cadman absent.Laura Kriho of the Cannabis Therapy Institute says, "This is a sad day forpatients. Not only have they been sold out by their lawmakers, but theyhave been sold out by well-funded dispensaries, and they have been sold outby so-called patient rights groups. This bill will destroy patients' accessto their medicine, drive prices up, and force patients back into the blackmarket. The will of the voters has been ignored once again by lawmakers,and sick and dying Colorado citizens will suffer.""This is taking patient rights back over 100 years," says Timothy Tipton, apatient advocate with the Rocky Mountain Caregivers Cooperative "Things aregoing in the wrong direction. Patients in the 1800s had better access tocannabis medicine than they will under this new law."In a departure from hearings in other committees, the Local GovernmentCommittee Chair, Sen. Gail Schwartz (D-Snowmass), allowed disabled patientsto testify first. This was followed by several hours of testimony from lawenforcement, including the District Attorney for Adams and BroomfieldCounties, the District Attorney for El Paso and Teller Counties, theDistrict Attorney for Jefferson and Gilpin Counties, the County Sheriffs ofColorado, the Colorado Chiefs of Police Association, the North Metro DrugTask force, and more. Most of the law enforcement testified against thebill, saying that they didn't believe the "dispensary model" was allowedunder Colorado's medical marijuana constitutional amendment.Several representatives of Coloradans for Medical Marijuana Regulation, alobbying group hired by a handful of well-funded dispensaries who have been"working with" Senator Romer on gaining concessions friendly to bigbusiness. CMMR testified in favor of HB1284, but was against a dozen or solast-minute amendments to the bill that Senator Romer surprised them withthat morning. Also testifying on the CMMR team was Brian Vicente fromSensible Colorado, an organization which claims to be in support of patientrights. Sensible asked for several amendments, but overall was satisfiedwith the bill that would eliminate 80% of patient's caregivers, forceprices up, and force patients to use only one dispensary for theirmedicine.Laura Kriho, the director of the Cannabis Therapy Institute, urged theCommittee to kill HB1284 and urged lawmakers to form a statewide commissionto study programs that have been working locally and recommend a bill thathad a broad base of support. Mark Simon, an activist with the disabledcommunity, testified that neither Sen. Romer nor anyone else had reachedout to the disabled community to get their input on the bill.Others who gave testimony against HB1284 were attorneys Robert J. Corry,Jr. and Lauren Davis; Laurel Alterman, owner of Altermeds dispensary inLouisville; Miguel Lopez of Mile High NORML; Robert Chase of ColoradoCoalition of Patients and Caregivers; and the Colorado Springs MedicalMarijuana Council. The mountain contingent was well-represented withKathleen Chippi, owner of One Brown Mouse dispensary in Nederland; JessicaLaRoux of Twirling Hippy Confections and Mark Rose of Grateful Medsdispensary in Nederland all testifying eloquently against the bill.The bill now moves to the Senate Appropriations Committee and then will bevoted on by the full Senate. CTI is urging patient rights supporters tocontact their state senators and urge them to vote No on HB1284.http://www.cannabistherapyinstitute.com/advocacy/contact.colorado.state.legislature.html

Sorba bigotry

2010-02-21T10:04:00.000-08:00

Once again, the internal contradiction within the GOP betweenclassical/economic liberals and then not being liberal when it comes topersonal individual behavior (e.g. drugs, gay marriage). A true liberallike Ron Paul could beat Obama, but I doubt the corporatists in the powerstructure would allow him passage...

Ron Paul is more like a sideshow for the Republican 'big tent' circus.

Responding to Contemporary Sophism…Cloaked in Contemporary Platonism

2009-06-16T09:49:00.000-07:00

In studying for my comprehensive exams in political theory, there’s a definite theme that seems applicable today. The debate between the Sophists and Platonists over truth and politics. This is obviously a perennial topic that comes up again and again throughout the history of political thought, but this converstaion is interesting as the debate seems to be somewhat timeless.

According to Reginald Allen:

“The sophists were wandering teachers of Greece in the latter part of the fifth century, traveling from city to city to lecture for a fee…[The] rise of democracy – direct, not representative, democracy – made skill in rhetoric important not only to those ambitious for political advancement, but to ordinary citizens concerned to safeguard before the law their property, their citizenship, and their lives. Sophism was not a doctrine, hardly even an attitude of mind, but a social movement…”

The sophists essentially rejected the idea of absolute Truths – in terms of both knowledge and morality – and elevated rhetoric to the art par excellence; teaching the unskilled, often poorly educated, how to “make the weak argument stronger and the strong argument weak.” In response, Plato (via Socrates) argues that highest human activity (the proper domain of politics) is the search for the enduring Forms that represent the Truth. This is done not by appealing to sensory experience (as the Sophists do), but to reason.

The reason I find this debate so interesting, is because it instantiates a dualism that persists today. On the one hand, it seems increasingly clear that FOX news and other right wing venues deploy sensory experience – so called “common sense” – in efforts to politicize events – and to manipulate perception of those events – in a way that is deleterious to the left. The “foreign” sound of the name Obama leads to facile claims about citizenship, the sight of Hispanic protestors waving Mexican flags are used to evoke unease over immigrant loyalties and potential terrorist ties, the fear and anxieties over economic distress are easily transformed into fears of socialism. Unfortunately, these efforts are resulting in increasing extremism and blatantly irrational behavior.

[See, for instance, this article] http://www.nytimes.com/2009/06/14/opinion/14rich.html?_r=1&em

On the other hand, however, the Platonic response is to elevate expert rule – the Philosopher King who alone has access to the world of Goodness and Truth – to an almost tyrannical position. The sheer idiocy of the opposing claims makes us want to scream out, “NO DAMMIT! Obama is a patriotic US citizen, the vast majority of immigrants are simply seeking opportunity for themselves and their families, and stabilizing the economy demands some government intervention.” And we aren’t wrong. The problem is that our opponents are just as certain that they have the truth as we are. Though there is a qualitative difference between their truths and ours, it is dangerous to assume that we have the objective Truth, and, were the country only ruled by us enlightened few, we would all be better off.

Both of our truths, it seems to me, are mediated by perceptions of “democracy,” political community, and justice. Resorting to Platonism – or, for that matter, its modern “empirical” counterpart, “science – is appealing because it gives us some solid ground beneath our feet (some privileged space on which to stand and proclaim our path of vision unique), but it’s arrogant, apolitical, and – above all – impractical. Both FOX on the right and MSNBC on the left have adopted the rhetorical tactics of the sophists, while proclaiming – in perfectly Platonic manners – that their Truth is objective (“Fair and Balanced”). Theoretically, I think that Foucault and Deleuze offer some tools that could point towards “another way,” but practically, the left has yet to formulate an adequate response. There seem to me to be two strategies that are making headway. The first, ironically, is found on the BBC and other outlets that make the attempt to be “objective (and in doing so serve to caricature stations like FOX). The second, is achieved through satire - Comedy Central/SNL and other efforts to reveal the absurdity of contemporary sophist/Platonists.

The new tea party revolutionaries...

2009-04-13T13:05:00.000-07:00

I find it interesting that, after the last election cycle, conservative arguments have been marginalized and they are effectively now in the HETERODOXY, we are also hearing much in the media now from "revolutionary," "tea-bagging," right-wing conservatives hailing incendiary remarks. And because the whole constellation of positions taken in what used to be under the umbrella of the right wing political camp has been disbanded and is in disarray, more and more of these political postures are becoming super-radical, anti-government, anti-establishment, anti-America, and anti-democratic. One can find bible-thumping anti-evolution Christians screaming "burn the books," libertarian party actives, constitution party actives, and conspiracy theorists warning about a "communist infiltration," and FOX News all coming together at these "tea parties."

Conservative right-wingers are now HETERODOX, and anti-establishment revolutionaries.
Bible-pushing Christians are now HETERODOX, and anti-establishment revolutionaries.
Free-market capitalism ideologues are now HETERODOX, and anti-establishment revolutionaries.

Incommensurate philosophies

2009-02-10T07:47:00.000-08:00

I've become a nihilist in regards to political economy. On the one hand, we have the conservative/libertarian/Austrian "cut taxes" ideology (regardless of massive deficits). On the other hand, we have the modern liberal/Keynesian "spend public money" ideology (to jumpstart production again - do we really need to prop up unprofitable industries?). But there is this logjam where no real progress is made (no side is more convincing than the other) because there are NO AGREED UPON FACTS. If we can't agree on what is going on on the ground, there is no real debate in the discourse - it's just ideologies clashing and trying to gain power/influence. Neither party has the proper approach. How can these incommensurate ideologies co-exist? The crisis needs to get worse to tip the scales.

The real question for me is: would capitalism ACTUALLY COLLAPSE IF WE DID NOTHING? Would there be a real threat of revolution? Are modern liberals vindicating Marx? Or is it just Polanyi's double movement?

Do those on the left really want capitalism to survive, given the environmental destruction and social polarization? If we were serious about change, it seems like we could have done much more (i.e. climate change, relocalization). What would the Republicans have done if they were in power? Would they really have had the balls to "do nothing"? (i.e. in the face of the real risk of socialist revolution or otherwise)...

Keynes alive and well.

2008-11-10T06:57:00.000-08:00

"Nov. 9 (Bloomberg) -- China announced a 4 trillion yuan ($586 billion) stimulus plan to spur expansion in the world's fourth-largest economy, helping sustain global growth as the U.S., Europe and Japan teeter on the brink of recession.
The funds, equivalent to almost a fifth of China's $3.3 trillion gross domestic product last year, will be used by the end of 2010, the Beijing-based State Council said today on its Web site. China will adopt a ``pro-active fiscal policy'' and pursue a ``moderately loose'' monetary policy, it said."

"(NY Times) The Bush administration was overhauling its rescue of the American International Group on Sunday night, according to people involved in the deal, amid signs that the interest on its current credit line of more than $100 billion was putting too much strain on the ailing insurer."

...MARKETS AND GOVERNMENTS ARE COMPLEMENTARY INSTITUTIONS. WRITE THAT ON THE BOARD ONE HUNDRED TIMES...

A Foucauldian NIghtmare

2008-10-10T14:31:00.000-07:00

The biopolitics of the information age: Data Mining

This excerpt from NPR (talking about a new book by data mining expert, Stephen Baker) discusses the way in which different entities (from Amazon.com to political campaigns to insurance companies) order you in categories ("tribes") depending on your consumptive choices (ranging from the goods you buy to the sites your surf) and attempt to mold and direct your day-to-day choices based upon the information that they receive.

Here is a portion of the article...also check out the 20 minute interview:
http://www.npr.org/templates/story/story.php?storyId=95166854

"When it comes to producing data, we're prolific. Those of us wielding cell phones, laptops, and credit cards fatten our digital dossiers every day, simply by living. Take me. As I write on this spring morning, Verizon, my cell phone company, can pin me down within several yards of this café in New Jersey. Visa can testify that I'm well caffeinated, probably to overcome the effects of the Portuguese wine I bought last night at 8:19. This was just in time for watching a college basketball game, which, as TiVo might know, I turned off after the first half. Security cameras capture time-stamped images of me near every bank and convenience store. And don't get me started on my Web wanderings. Those are already a matter of record for dozens of Internet publishers and advertisers around the world....

...The Numerati also want to alter our behavior. If we're shopping, they want us to buy more. At the workplace, they're out to boost our productivity. When we're patients, they want us healthier and cheaper. As companies like IBM and Amazon roll out early models of us, they can predict our behavior and experiment with us. They can simulate changes in a store or an office and see how we would likely react. And they can attempt to calculate mathematically how to boost our performance. How would shoppers like me respond to a $100 rebate on top-of-the-line Nikon cameras? How much more productive would you be at the office if you had a $600 course on spreadsheets? How would our colleagues cope if the company eliminated our positions, or folded them into operations in Bangalore? We don't have to participate, or even know that our mathematical ghosts are laboring night and day as lab rats. We'll receive the results of these studies—the optimum course—as helpful suggestions, prescriptions, or marching orders."

The scary part about this is that data mining opens up a wealth of knowledge about personal behavior that the statistics of twenty years ago did not. This provides new potential for entities to intervene in the management of day-to-day life...Political campaigns engaging in micro-targeting, for example, have the means to render us transparent as a very deep level.

Althusser - Foucault connection...

2008-10-06T08:17:00.000-07:00

According to Wikipedia: "The prominent Guevarist Régis Debray studied under Althusser, as did the Derrida, noted philosopher Michel Foucault, and the pre-eminent Lacanian psychoanalyst Jacques-Alain Miller."

Amy Poelher's silence kills the McCain campaign.

2008-10-01T19:15:00.000-07:00

The road to the Whitehouse runs through Letterman and Saturday Night Live...

Formalism: Rationality & Self Interest

2008-09-29T18:48:00.000-07:00

Formalism (in economic anthropology, economics, and political science, etc.) assumes agents are self interested maximizers subject to the constraint of scarcity.

But self interest can be rightly expanded to include sentiments and motivations and preferences such as altruism, and can be amended to contain the interests of the collective.

People are SUBSTANTIVELY RATIONAL. But that is not a very risky claim. I'm an economist and assuming this works for a lot of stuff.

This is not to say that proceeding with formalist methods and deductive reasoning is appropriate for every situation. Assuming self-interest is a reasonable methodology in many instances, particularly in Western, capitalist countries.

This could proceed into a discussion of Polanyi and the imbeddedness or disembeddedness of an economy...

The Gonzo Social Scientist

2008-09-27T23:40:00.000-07:00

Go.