I only read it for the articles

Specifically, the obituaries.

The 'it' here is The Economist. Their obituary section, on the last page of the magazine, is far and away the most interesting part of the whole publication, and the part I always turn to first. It's not uncommon that this will be the only bit I actually read.

The reason it's so remarkable is that it pulls off an incredibly difficult feat - surveying a person's life in a way that manages to be respectful but even-handed. This is a fine line to walk - one does not wish to speak ill of the dead, but an obsequious hagiography will simply make for dreary and implausible reading. Consider their obituary for Osama Bin Laden if you want to see them take on an extraordinarily challenging subject for which to pull off this feat.

Most interestingly, they choose their subjects in a way that gives you insight into some or other aspect of society, while still being focused on the person in question.

For an example of a thoroughly unorthodox but excellent piece, look at their recent obituary for Elmore Leonard. Can you think of any other magazine that would publish something like that?

It left me glad I renewed my subscription recently after a long absence.

Then, of course, I flip to the front of the magazine and find masterpieces of grimly comic absurdity, such as endorsing Kevin Rudd in the Australian election. The role of Rudd's earlier 'liberal' policies towards asylum seekers feature several times in their reasoning. Personally, I would have thought that a magazine calling itself 'The Economist' might be able to give some nominal recognition to the fact that thousands of extra boat people have drowned as a result of responding to the incentives of this 'liberal' regime in an entirely predicable and obvious fashion. The dig at Abbott about homosexuality is particularly comical, given that Kevin Rudd's support of gay marriage dates all the way back to ... May this year. Now that's conviction! That, and praising Labor for passing a carbon tax with a price of carbon set at 3 times the world market price. Adam Smith would be proud.

And I get reminded of why I gave up my subscription in the first place.

The one phrase you probably haven't heard being thrown about much in the debate on whether to intervene in Syria.

"Libya".

So, we want to topple a nasty secular dictator we know, who is locked in a struggle with Al Qaeda-linked terrorist 'rebels', confident that we'll manage to turn the place into Switzerland.

How'd that work out last time? Not so hot, as I wrote about at the time.

How's it going now? You've stopped hearing about it, but that's just because the west has a short attention span.

From a randomly-chosen item in the first couple of hits when I type 'news Libya' into google:

"We all thought Libya had moved on – it has, but into lawlessness and ruin"

Libya has plunged unnoticed into its worst political and economic crisis since the defeat of Gaddafi

A little under two years ago, Philip Hammond, the Defence Secretary, urged British businessmen to begin “packing their suitcases” and to fly to Libya to share in the reconstruction of the country and exploit an anticipated boom in natural resources.

Yet now Libya has almost entirely stopped producing oil as the government loses control of much of the country to militia fighters.

Well that's just grand.

No, really, things will work out much better this time. Trust us! From the producers who brought you 'The Arab Spring'.

Fortunately, common sense seems to be slowly breaking out this time around.

It started in Britain:

British Prime Minister David Cameron loses parliamentary vote on Syrian military strike

 But now it's catching on everywhere:

TONY Abbott: We’ve got a civil war going on in that benighted country between two pretty unsavoury sides. It’s not goodies versus baddies, it’s baddies versus baddies. And that is why it is very important that we don’t make a very difficult situation worse.

Look, the phrase 'baddies versus baddies' is definitely infelicitous, but the sentiment is certainly correct. (You could probably paste the same quote into most internal conflicts in the Middle East, if not most conflicts in the Middle East more generally). I personally prefer the Kissinger restatement of the same view about the Iran/Iraq war - 'It's a shame they can't both lose'.

Still, better crudely phrased realism than naive dross about dreams of freedom that winds up with thousands more in body bags.

When I said it's catching on everywhere, you can always rely on some people to refute the 'everywhere' part:

Sweden on Tuesday became the first European Union country to announce it will give asylum to all Syrian refugees who apply.

“All Syrian asylum seekers who apply for asylum in Sweden will get it,” Annie Hoernblad, the spokesperson for Sweden’s migration agency, told AFP.

Ha ha ha! "All"?

I don't think you've thought this through.

Rent-Seeking vs. Rent-Collecting

When historians of the future are writing the epitaph for the west, I imagine that one of the characteristics that will strike them about the present age is the increasing prevalence of rent-seeking.

As the government inexorably expands in size and scope, it becomes more of a suckers game to simply outcompete the opposition, and more lucrative to lobby the government to have them shut down.

This might take any number of forms - ludicrous licensing requirements that lower supply, absurd restrictions on competitor firms, tax breaks for your particular boondoggle industry - whatever works.

If you want a list of some of the more outlandish ones, browse through the cases the Institute For Justice has fought over the years. It's a Sisyphean task, alright.

The strange thing, though, is that most people profess to hate rent-seeking. So how come we end up with so much of it?

Part of this is simply political economy. A small but organised group fighting for a large benefit will often out-lobby a large dispersed group (e.g. taxpayers, consumers) who each suffer a small harm.

Part of it is just rank hypocrisy - when other companies lobby for their licensing requirements, it's just to squelch consumers, but I'm deeply worried about customers not getting their hair braided correctly.

Nobody is the villain in their own narrative, after all.

But I don't think that's all of it.

I think that to really understand the extent of rent-seeking, you need to appreciate those who enable them - the rent-collectors.

The way I would characterise it is that rent-seeking, properly defined, is about lobbying for socially inefficient laws and regulations that will benefit you privately.  The trial lawyers lobby turns up to argue that we really truly ruly need to have a legal system where the loser doesn't pay the other side's costs, for instance.

Rent-collecting on the other hand, is what happens when a party simply takes advantage of a bad law that is already on the books. Unlike the rent-seeker, the rent-collector does not actively push for socially inefficient legislation. Instead, he simply takes the inefficient law as he finds it - somebody is going to get the rents due to the bad law, and it may as well be me.

These are the much wider circle of folks who are thus corrupted by the process - their own self-interest stops them agitating for a repeal of the bad laws, but their lack of involvement in the initial setup means that their consciences are clean.

For every community organiser who gets a cushy job on the rent-control board, there are hundreds of tenants getting a few hundred bucks a month for free from their landlord.

For every creep in the restaurant lobby fighting to outlaw food trucks, there are hundreds of restaurant proprietors vaguely relieved to not have a truck parked nearby.

And sometimes, the rent-collectors (at least indirectly) will be people who in other circumstances would be the first ones to crusade against rent-seeking.

American securities class action lawsuits are like something out of a Kafka novel. The shareholders of a company collectively own the company. Suppose the company makes some screwup and causes the share price to drop. Based on the fact that the company is a separate legal entity, some lawyer and a gold-digging lead plaintiff will file suit on behalf of the shareholders against the management of the company that they themselves own. The management is of course protected by the company, so money is coming out of the company coffers (which the shareholders own) to nominally compensate the shareholders of the company. Got that? Well, actually, the current shareholders (who don't owe an actual duty to anybody) are indirectly paying money to the old shareholders (who often overlap substantially with the current shareholders). In theory, anyway. Part of the money is coming from insurance companies who write the professional indemnity insurance for the directors, but the company is going to be paying that back in higher premiums in no time flat. You can rest assured that the only people making any money off the whole farce are the lawyers.

Or are they? Who else benefits from this ridiculous charade?

A lot of the time, it's economic consulting firms. They make a decent living defending companies against these lawsuits, and showing that the damages aren't as high as the often ludicrous plaintiff's claims make out to be. These are some of the most free market types you can imagine, with economics degrees from the best universities.

Don't get me wrong, in the scheme of this whole monstrosity, these guys are far and away the most defensible. They're fighting for good guys, so to speak.

But still - how many of them would be out there lobbying to get securities class action reform to eliminate all this absurd waste? How many of them would honestly greet such reform with the same zeal that they would if it happened in any other industry? Even if it put them out of a job?

To ask these questions is to know the answers.

When despotic regimes take prisoners of war, one of the things they often try to get the captives to do is to write out statements that are disloyal to their home country. Sooner or later, cognitive dissonance takes over - the things you wrote down that you originally didn't believe, you come to believe, because you subconsciously prefer this view to the alternative that you wrote cowardly and disloyal things rather than face punishment. The extreme form of the result is Stockholm Syndrome. There's a reason that making disloyal statements is punished as a serious offense.

The reality is that behind every rent-seeking lobbyist are thousands of rent-collecting regular joes who have convinced themselves either that a) the current regime is either downright sensible, or b) at a minimum, it's terribly unfortunate but there's really nothing to be done, old chap.

Thus are the sheep corrupted to be complicit in their own fleecing. They'd all acknowledge that, sure, this is just robbing Peter to pay Paul. They'd further acknowledge that, sure, everyone here thinks they're Paul, and sure, they can't all be right. But still, when all's said and done, I really will be Paul, and that's all that matters, right?

Briefly

A sad but sweet comic from SMBC.

Brave Zack Weiner! That was drawing! Good alike at grave and gay!

How to tell if a coffee shop serves good coffee, part 2...

Without drinking it, obviously.

This is continuing in the 'news you can use' category, among the trivialities that have been occupying my life of late while the events of the world pass me by.

I used to go with the smallest cup size offered by the cafe. There's a tendency among bad coffee shops to serve you up enormous bathtubs full of bilge water. Of course, to get a larger cup of coffee, they simply run the water through the same set of grounds until it turns into a burnt mess. The places that offer you a small sized coffee are more likely to know what they're doing.

But this was superseded by a tip from AL - the number of milk jugs on display. Good places will never heat their milk more than once. As a result, they tend to have a lot of small milk jugs around. If you see that, it's very likely somewhere that knows what they're doing. On the other hand, I've never had a good coffee from a place that had a single giant milk jug that kept being reheated.

If the place is failing the above signals and you still need a coffee, at a minimum order the smallest size you can.

(For the previous best signal, see here)

Short Answer Exam Technique

If confronted with an exam question of the following form:

"Two friends are having a discussion. Simon say that [ABC]. Sally, on the other hand, claims that [XYZ]. Who do you agree with? Why?"

and you are unsure of the answer, assume that the female is right. Social rules in exams follow television ads - in a mixed sex group, the man is almost always depicted as the stupid one. This is the mirror image of the default assumption in TV ads in the 50's and 60's, where the silly housewife was the staple reason why you should buy a given product, and society seems to have been furiously overcompensating ever since.

There's another similar rule on TV - in a mixed race group of males, the white guy is depicted as the stupid one. The latter case oddly doesn't seem to feature as commonly in exams, as Marmeduke isn't frequently in discussion with Jamal. But if he were, I'd bet that way too.

Truancy, etc.

I have been rather tardy with this particular web diary of late. As usual, a lack of posts either means that my life has gotten a lot less fun or a lot more fun.

Thankfully, in this case it's the latter, as part of an extended holiday/general goofing off. So as between my two readers and myself, there's been a conservation of total utility, rather than a pareto loss.

The Wackiness of Hotel Pricing

As far as I can hotel, there are only two possible prices for services at a hotel:

a) 5 times market price, or

b) Free.

And that's it. Nothing is charged at market pricing, and nothing is charged at marginal cost either. It's just cross-subsidisation up the wazoo.

To make things weirder, the list of which stuff goes into the 'free' category and which stuff goes into the 'massively expensive' category seems to vary widely from hotel to hotel.

In some places, internet is free. In others, it's $15 a day. Breakfast is either complimentary, or $30. Parking is either free or $30 per night. The fitness centre is either free or $20 per day. etc.

Personally, I'd gladly trade the crappy hotel room coffee and widescreen TV (both nearly always complimentary) for free internet, but of course that option isn't on offer.

When wifi first became a thing, I was very much hoping that it would be put in the 'TV' category of 'essential services that every room gets gratis'. This battle for social norms seems to be ongoing, currently in the trench warfare stage where neither side is making any particular progress.

A lot of this seems to be just weird mental accounting and salience. Some places now charge a single, mandatory 'resort fee' to cover all the incidentals. Of course, if it's a mandatory fee, you could just add it to the cost of the room and make it all truly free. My only guess as to what's going on here is that this is a ruse to fool price comparison websites into displaying a lower price than the total value.

For all the IO models we have, sometimes it just seems like the best working model is 'companies fool around with pricing and charge as much as they think they can get away with'. This is probably a crude version of some of the IO models, like the Gabaix and Laibson model.

Pricing is weird.

With the evening set out against the sky...

How strange it is to be in the twilight of one's youth!

To gaze around and reflect on the set of choices you made (whether deliberately, accidentally, or some combination of both) that now see you still out in the fading embers of the sunset.

By now, most of your peers have gone inside and given up skylarking for the day, and are busy preparing dinner, stoking the home fires, and other such responsible things.

In a few short hours, night will have set in in earnest, and it will be cold and inhospitable to be out here alone.

But in the meantime, the sky is a brilliant orange. The sun still bathes the world in a glorious light, but without the same heat as before.

Let us stay and linger here just a little longer...

The most interesting data set I've seen in ages

The age old question, as most readers of this august diary will know, is the following:

Do you know what it takes to sell real estate?

The answer, of course, is that it takes brass balls to sell real estate.

A few years ago, Heartiste talked about the Apocalypse opener in picking up women. This was taken from Ciaran at Bristol Lair, and proceeds as follows:

You rock up to a chick and, in a confident, level voice you say

“Hey, how’s it going.”

She will say

“Fine.”

You then say

“Cool. What are you doing later?”

She will say

“I’m not sure.”

You then say

“Do you want to come home with me?”

Then you hold.
Hold.
HOLD………………..
HOLD IT MY SON……………………..
HOLD THE F***ING LINE………………

Boom. Makeout.

And that’s the Apocalypse opener. You don’t ‘build rapport.’ You don’t ‘elicit values.’ You don’t ‘kino escalate.’ You don’t even ask her fucking NAME. You ask if she wants to sleep with you in the THIRD SENTENCE, hold the line, and reap the whirlwind.

Yowser.

That my friends, is some serious real estate transacting right there.

The second, more interesting part, is Ciaran's analysis of how to make the thing work:

The key to making it work is not how you say it, but what you do in the 30 seconds after it’s left your mouth.

Before I talk specifics, let’s state the single CARDINAL SIN of the Apocalypse, which is the ONLY THING that can blow you out.

NEVER BE WEIRD

That’s it. Don’t be weird. You have to deliver the opener deadpan. Like you are talking about the WEATHER. You are not making a BIG THING of it. You’re just ASKING.
You are not MOCKING. You are not JOKING. You are not TOO SERIOUS.

It is NOT PLAYFUL however – it is REAL.

You are REALLY ASKING HER.

If she says no – you only need ONE COMEBACK.

It is this:

“Ok.”

Then you strike up a ‘normal’ conversation about the colour of the wallpaper, or the music that’s playing, or the fact that you did your laundry earlier today.

Whatever.

In other words, the reason it works is not because girls have a desire to go home with any guy that asks. Rather, the reason is that it takes some sizable cojones to deliver this deadpan, and not lose your nerve. To the extent that it may work at all, it's that you definitely show yourself as being unusually self-confident. As long as you don't come across as autistic or a sociopath, this is a clear plus.

The question is, of course, how well does it work? Or more realistically, does it work at all?

Some guy decided to test it out. A hundred times. And what are the results?



The standard comments over at Reddit are pointing out that none of the girls say yes. This is the dog bites man aspect.

But I think it misses the much larger man bites dog story here.

Don't ask how many girls would sleep with him. Ask how many girls stick around, laugh, and don't run away immediately. And bear in mind that this guy guy has several handicaps relative to the stated method, namely:
-He isn't doing the crucial conversational follow up.
-He's doing it often on groups of girls, or guys with girls, both of whom are WAY less likely to be seen to say yes in front of their friends
-He's doing it in broad daylight
-He's doing it in girls who are stone cold sober, and whom are unlikely to be looking to score.

Because if you believe the stated explanation, if you did this in a better setting and kept up the conversation afterwards and sounded mostly normal, would they continue to respond positively?

So how does that metric work?

Look at girl number 6. Look at the way she continues to linger and smile at him after saying no.

Look at girl number 8. She laughs and says 'maybe, I don't know. Perhaps?'

Think about that for a second. Think about it and try to tell me that the real story here is that the guy didn't get a concrete yes immediately.

Number 21, in a group of two, says that he's made their day.

Number 44 says, 'Um no. I mean, you're attractive, I'd probably make out with you.'

More to the point, look at all 100, and count how many responded angrily. The answer is one. One out of a hundred throws a drink at him. Be honest, would you have estimated only a 1% rate of angry retaliation? Because I sure wouldn't. How many guys could claim that their opening line elicited at least a smile and a laugh in 50% of cases?

Again, the unsurprising part is that this doesn't work as implemented.

The remarkable part is how positive the overall response is. Bemused, sure. But positive.

This guy has a bright future ahead of him in the real estate sales business.

Short answers to stupid questions

"Because they enjoy it. Why does anyone do anything?"

Singapore and Hong Kong - A Tale of Two Reactionary Cities

Singapore is often held up as a kind of model reactionary state among the nations in existence today. It has incredibly low crime rates, low taxes, general social harmony, and has broadly built itself up from being a swamp to first world country in 60 years. It's also done this while juggling a tricky ethnic mix that's produced social conflict in many other countries. Lee Kuan Yew pulled this impressive feat off in part by restricting democracy and the freedom of the press, thus reducing the means by which ethnic tension can be whipped up. Most westerners dislike both of these aspects, but its hard to argue with results.

Back when I was but a wee Holmes in high school, I was a fervent (small 'd') democrat. I remember in an otherwise worthless social science class discussing with a Singaporean friend of mine about how his country was run. He was a defender of their system, and argued that it was actually popular with the people. I tended to not believe him, and always wanted to know why, if the government thought they were so popular, didn't they put matters to a fair vote? A failure to do so must mean that they suspected they'd lose.

It took me a long time to realise that on this point, I was wrong. The firstfact to understand about Singapore is that even though their 'democracy' is a joke, the government would very likely win an actual fair election. They are popular. The fact that people aren't voting on civic matters cannot be equated with them being unhappy about civic matters. Witness the outpouring of genuine joy and interest in the royal baby if you don't think this kind of thing is possible.

But here's the bigger question - what is the one, big genuine knock on Singapore as a place to live?

It's boring.

And this, alas, is true. There is really nothing interesting going on there. You can shop. That's about it.

It's tempting to dismiss this as a trivial concern, or as being a spurious one-off point, but I'm not sure that's true.

My guess is that the policies used to maintain the very high level of  social order -- restricting freedom of the press and voting, high alcohol taxes, large punishments for all crimes -- are indeed likely to discourage creative types from moving there, and potentially likely to discourage certain aspects of creativity in the local populace. 

In other words, you may not like the hippies of San Francisco, but it's not an accident that the interesting restaurants and art galleries are located nearby. When it comes to eccentric thinking and bon vivant lifestyles, there may be a certain amount of taking the bad with the good that's required.

But this is where (British) Hong Kong provides an interesting counterpoint.

Hong Kong managed to achieve a lot of the same material successes as Singapore. But it never had the same reputation for being boring. Hong Kong cinema was long famous, and the city is filled with interesting restaurants, bars and galleries. Also, notably, Hong Kong does not share Singapore's restrictions on civic life. The newspapers were largely free to publish whatever they wanted. The court system was actually applying genuine British Common Law, rather than twisting concepts like defamation to become de facto censorship tools against criticism of the government. And while the crime rate was not so famously low (the Triads, for instance, have no obvious Singaporean equivalent), it was fairly peaceful.

So what explains the difference? Should we just conclude that Singapore should just chill out a bit on the freedom of the press?

Well, maybe. But there's something else that may explain it.

If you haven't read it yet, Slate Star Codex gave a pretty good summary of reactionary ideas. In particular, consider the claim of Mencius Moldbug - that a truly secure sovereign would have no need to care what its citizens thought. This is true, and also would be a big benefit - you don't have to constantly wage a propaganda war over what people believe.

But Slate Star Codex also pointed out some of the conceptual problems with this idea - in particular, you can't just assume a hypothetical totally secure sovereign. Real sovereignty has to be enforced, and that almost always means caring about the opinions of at least some subset of the public, even if only the guys with guns. Cryptographic weapons are the Moldbug answer, but with 3D printed guns already available, it's not clear how feasible this is.

Still, this mental exercise helps to illuminate part of the difference between Hong Kong and Singapore. In Singapore, Lee Kuan Yew only had the resources of Singapore to secure Singapore. If enough people start agitating for change, and the army isn't willing to shoot them, then he's out on his @$$. Hence the somewhat draconian efforts to control the popular discourse.

But in Hong Kong, the British were able to entirely secure the colony almost without regard to what the subjects thought, should they desire. The reason is that they could just send in the Royal Navy. And because this force operated effectively without any concern for the average Hong Kong resident's opinion, Britain had a role much closer to the hypothetical Moldbug sovereign - they say what they want, I do what I want.

And this allowed for something closer to Moldbug's Fnargl - the sovereign immune to any attack from the locals. At least as predicted, this allowed for a much more relaxed attitudes towards civil society.

But we arrive at a somewhat awkward conclusion - the ideal sovereign is not truly sovereign, but reliant on some larger power to ensure its survival irrespective of local opinion.

And hence you can see why Hong Kong features perhaps less prominently in the reaction circles. Until you can find a way to make us all subjects of enlightened British civil servants, one may need the guarantee of some higher authority to get a sovereign that truly doesn't give a rat's. Or accept that order requires no freedom of the press and not many art galleries.

This is not an ideal conclusion, of course, but nobody said that reality had to conform to our highest hopes.

On the other hand, both Hong Kong's governors and Lee Kuan Yew would have likely done a damn sight better job at managing Detroit than democracy has done. No sense letting the perfect be the enemy of the good.

Two Hundred Millionth Verse, Same as the First…

So much has been said on the Trayvon Martin case already. It feels a little bit like World War I – when you try to explain that France is fighting Germany because a Serbian nationalist shot the heir to the Austro-Hungarian throne, it’s not immediately clear why either of the two belligerent parties would give a rat’s @$$.

So it is here – a Hispanic wannabe cop shoots a teenage black thug, but as always, the fault is white racism. Goyim kill Goyim, and they blame the Jews. And so everyone must take up cudgels again to defend their accustomed sides.

After almost a decade of living in this country, it’s hard to express just how dreary all this is. Lordy, I am sick to death of race, and the peculiar American preoccupation with the subject. The faux outrage, the sheer humourlessness, the constant walking on eggshells, the pissant cowardice it inspires, and the way it paralyses people from making even the most straightforward observations about the world around them.

This is the most uniquely American of pathologies. Not racism, of course. America today is perhaps the least racist country on the face of the earth. You may seem surprised, but honestly, who else would lay a claim to the title? The only other contenders are small, mono-ethnic  countries for which issues of race simply don’t arise in daily life.

No, it is the paranoia about racism, regardless of the absence of any actual racial animus, that is America’s most appalling invention. Even if you disagree with my claim that America is the least racist country on the planet, if you formed the ratio of Race Paranoia = (Worrying About Racism) / (Actual Racism), I defy anybody  to claim that America doesn't lead the world on this metric by miles and miles.

The question is not whether racism (that is, racial animus) is a problem. Like the Copernican view of the solar system, it’s absurd to pretend this is still any kind of social controversy. It is a problem, where it occurs. Rather, the question is whether you choose to see expressions of racial animus in ever more innocuous speech and actions. The question is whether you continue to view the possibility that someone, somewhere, is harbouring racial animus as the single most important problem in the world, even as the actual level of racial animus in society drops precipitously.

And what has all this brought? Has being ever more exquisitely sensitive to people’s possibly hurt feelings about the matter of race actually, you know, produced more social harmony? If it has, I can’t see much evidence of it. All I can see is what John Derbyshire memorably described as ‘an evolution towards the ever thinner-skinned’.

Like all American cultural traits, good or bad, race paranoia is slowly taking over the world.  When I left Australia, it was mercifully a place where one was largely spared the constant, relentless hand-wringing, the non-stop ‘Serious You Guys This Is The Most Important Issue In The Whole World’ evangelism of race hucksters, do-gooders and fools.

I suspect, with considerable resignation, that when or if I return, Australia will have become America in my absence.

Some PR advice for the PRC

If you look across the countries of the world, it is a reliable trend that any country featuring the word ‘Democratic’ in its name is both
a) A hellhole, and
b) Not at all democratic.
Think ‘The Democratic Republic of the Congo’ or ‘The German Democratic Republic’.

In many ways, this is isn’t surprising – the countries with the worst governance records and the least scruples want to cloak themselves with the veneer of respectability by claiming to be what they think polite society demands they be. This doesn’t fool anybody except the rubes, of course. But at least it indicates a clear estimate of where they think the positive brand equity lies, and it seems to be in ideas like ‘Democratic’.

Which makes China all the more puzzling.

The Chinese Communist Party has been becoming less communist ever since at least when Deng Xiaoping took over. These days, it is not meaningfully Communist at all.

In fact, if it were to rename itself ‘The Chinese Capitalist Party’, the description would probably actually be more accurate (although clearly imperfect).

But instead, they still want to keep clinging to the title ‘Communist’. This is odd to me. Maybe it just reveals my biases, but at least by my estimate of the ‘polite society’ metric, Communism has some pretty toxic brand capital – the forced labour camps, the gulags, the man-made famines, the hundred-odd million corpses piled up over the course of the 20th century. It’s not as toxic as the ‘Fasicm’ or ‘Nazi’ brands, of course (in public perception at a least, regardless of whether you think the relative ranking is deserved).  But if you just wanted to convey a sense of ‘caring about the workers and the poor’, what about ‘Socialist’ or ‘Social’? Surely that would be an improvement.It’s almost as if the Republican Party wanted to use its current policies but refer to itself as the Nazi Party.

My guess is that this is mainly due to wanting to maintain the legitimacy of the current regime by implying a historical continuity in the lineage of power (to disguise the almost 180 degree turn in some of the policies). How else do you explain the cultish devotion to images of Mao, notwithstanding that Mao would probably have a fit if he saw the current policies being implemented by the current ‘Communist’ party?

The best description to me of the current Chinese government, at least domestically, is ‘like Singapore in a number of its attitudes towards policy, but more corrupt and with a more puzzling internal party mechanism’.
But ironically, unlike the Democratic Republic of Congo, I think this current labeling does fool more people than just the rubes. I imagine it colors a fair bit of the instinctive hostility to the Chinese government in the west,  at least to extent that they continue to pay obeisance idolize a bankrupt and depraved ideology, even as they disavow it through their actions.

In other words, their actions have actually justified jettisoning what seems to me to be a disastrous linkage, but they cling to it tightly.

I guess they just don’t think that Communism is such a loathsome thing to be associated with. I’d like to think they’re totally wrong, but depressingly I’m not so sure.

On Shanghai

-One of the classic experiments in psychology to indicate overconfidence is to ask people to self-rate their driving ability. Nearly everybody is ‘above average’. Part of this is certainly everyone thinking they’re better than everyone else, but part of it is also people disagreeing on what it means to be a good driver. Shanghai really illustrates this distinction quite sharply. The drivers are not ‘good’ drivers in the sense of being safe and prudent. Instead, it’s hair-raising – squeezing  in between cars, non-stop games of chicken with buses and other cars trying to merge, motorbikes regularly just breezing through red lights while pedestrians are walking at a cross-walk. But in another sense, the drivers are highly skilled in their ability to navigate these hazards without crashing more often. The number of times my taxi driver would be totally comfortable driving maybe 10cm away from another car trying to merge was outrageous. And the games of chicken always end at the last minute, but without the driver seeming noticeably put out. I would be freaking the hell out long before.

-It is fascinating to watch the behaviour of the native Chinese in China versus the native Chinese when in America. The latter tend to be quiet, incredibly polite and soft-spoken, and give off a strong vibe of wanting to avoid causing offence. But in Shanghai, people yell and shout all the time, often in ways that make it difficult to tell if the people are irritated at each other, boisterous, or simply have difficulty controlling their volume. Their faces don’t necessarily indicate anger, but the other parts of their body language seem oddly loud and confrontational.

-The notion of body image is very different from the US, particularly among the men. I didn't see anybody that looked like they lifted weights, and few that looked like they even did regular exercise. Notwithstanding this, some of the men have a tendency when hot to simply lift their t-shirt up to expose their stomach. The men that would tend to do this on average had a slight pot belly, making it a hilarious image of not-giving-a-@#$%.

-To my mind, skyscrapers have enormous positive externalities simply in terms of producing interesting vistas. Shanghai has a particularly excellent skyline. The guidebooks wax lyrical about the elegant historical buildings near the Bund, with their classical early 20^th century architecture. But the people, both Chinese and foreign alike, have voted with their eyes, which are all turned towards the massive skyscrapers of Pudong. They are right to do so. A hundred storey glass and steel structure is an amazing sight, and a fitting tribute to man’s mastery over a world that cares not one whit whether we perish or not.

-If I had to describe the city briefly, it would be thus: imagine Singapore, but ten times bigger, and considerably more chaotic.

-Inspecting the boarding passes and flight times for my flights from Beijing to Shanghai and Shanghai to Hong Kong reinforces in my mind that I have not the foggiest notion of Chinese geography, including even basic questions about how large the place is.

Mourning the Loyalist Cause

As a tribute to the dying hours of the National Holiday over here, everyone who hasn't yet read it should read the great Thomas Hutchinson's 'Strictures Upon the Declaration of Independence'. It is long, but I promise you it is worth it. You may be surprised to find that the best description ever written of the Declaration of Independence is from someone who was deeply skeptical of the entire affair.

Strictures Upon the Declaration of Independence is also a wonderful secret handshake of sorts, because my strong guess is that nearly everyone who has read it is no more than one degree removed from a Mencius Moldbug fan.

Egypt and the Endless Wellspring of Western Optimism

So the Military in Egypt decided they'd had enough of the democratically elected Muslim Brotherhood government and removed them in a coup.

Firstly, can you blame them?

This Business Insider article from May details quite well exactly how screwed the country has gotten since the Muslim Brotherhood took over in the glorious Arab Spring. Some highlights:

Homicide rates have tripled since 2011

The number of armed robberies rose from 233 in 2010 to 2,807 in 2012.

Brotherhood president Morsi declared no court is authorized to overturn the president's decisions.

And on, and on, and on...

Should these events have come as a surprise?

The average westerner, to the extent that they think about the matter at all, is convinced that democracy is both an inherent moral good and an effective intrumental good. It is morally just to put matters to a vote, and doing so produces outcomes that will be judged as good even aside from the manner of decision.

The reactionary viewpoint tends to view democracy as inherently a moral neutral - what does it matter if things are voted on? Is it better than just having a wise king decide on what he thinks is the best outcome? And in terms of the practical angle, it tends to produce permanent social conflict - the Cold Civil War, in John Derbyshire's description.

Still, a Cold Civil War is a hell of a lot better than a hot civil war. The current state of the west, however decayed, is still rather pleasant. And the governance, while sclerotic and disfunctional, works way better better than most non-democratic places in the world.

But even a passing familiarity of places that have tried to implement democratic systems will reveal plenty of places that actually got significantly worse once people started voting (Zimbabwe, Egypt, Palestine, Iraq), and way more that certainly didn't improve (see: all of Africa, nearly all of the Middle East).

So what to make of it?

A skeptic's middle ground might be to simply note that democracy is a tool whose outcomes depend entirely on the quality of the people voting and what they're minded to vote for. If you have civilised people voting for their best estimate of what will be in the overall national interest, then it will probably turn out pretty well. Then again, if you have a population of civilised people who are looking out for the national interest, your country will probably turn out pretty well even if they're not voting (see: Singapore).

But if you have people minded to vote for tribalism, or for tyrannical religious rule, or to attack and drive out minorities, or to eat the rich, or to start endless wars with their next-door-neighbours... well, then that's what you'll get.

Sometimes, you can shrug this off as a national comeuppance - if people want stupidity, they deserve to get it.

But what about when a majority votes to oppress the minority (e.g. the Copts)? Do the Copts 'deserve' their fate for simply not being numerically superior? Someone has to be a minority group, after all.

The real question is whether it is predictable that certain national populations are likely to view voting as an excuse to impose a tribal or religious totalitarianism.

Of course, to even begin to answer that question, you'd need to be willing to contemplate the possibility of such a thing as 'national character'.

And since nobody is willing to do that, when democracy seems to lead to disaster, it must be posited that there was some flaw in the voting or political process that prevented righteousness prevailing. This is No True Scotsman meets Whig History on steroids - the good are always more numerous than the evil, and so elections will always produce good outcomes, unless they're thwarted by some evil group. The protesters in Tahrir square must all be freedom-loving democrats, notwithstanding that they seem to keep raping female reporters that stray too close.

In other words, the answer to disastrous outcomes following elections is always more elections:

As acting leader, Mr Mansour will be assisted by an interim council and a technocratic government until new presidential and parliamentary elections are held. No details were given as to when the new polls would take place.

Second verse, same as the first.

Ex ante, I wouldn't have thought that Egypt was a particularly bad candidate for democratic elections, at least as far as third world countries go (certainly more so than Afghanistan). But it keeps not working out that way. At some point, it must be considered whether in Egypt, Liberty and Democracy are at inherent odds with each other.

This is Egypt under liberty but not democracy.

This is Egypt under democracy but not liberty.

The more things change...

In Egypt, a Dutch female reporter who was reporting on demonstrations in Tahrir Square was savagely raped. Apparently she was an intern covering the protests for Egyptian TV.

Lest you think this is just targeting western female reporters, the protesters are sportingly equal-opportunity when it comes to their rape targets. They've raped up to 91 women in the past 4 days, with reports saying they attacked a grandmother and a seven-year-old child.

This kind of thing is obviously tragic and repulsive.

And yet, this has happened so many times now that it's approaching a farce.

Back in October, I reported that female reporters covering protests in Tahrir Square were getting raped. And this was already thoroughly predictable at that time. It had already previously happened here. And here. And here. And here. And here.

Are you starting to see a pattern?

What in the name of all that is holy are news organisations doing sending female reporters into Tahrir Square? I know that the modern zeitgeist is that apparent differences between the sexes are entirely due to discrimination and that women are entirely as capable of doing any job as men.

Purely for the sake of argument, let's assume that this statement is largely true.

Do you think that at some point the equality fetishists might consider that men and women reporters at least may not be equally attractive rape targets for vicious third world mobs?

Or even if this possibility didn't occur to you immediately, do you think that after, what, the hundred-and-something-th such occurrence, you might at least partly reconsider your hypothesis?

I can only think of two possible reasons why as a female reporter you'd still sign up to report on protests in Tahrir Square.

One is that you're tragically and hopelessly naive about the darker aspects of human nature.

The other is that you have been paying no attention whatsoever to what's been going on at these protests.

Both possibilities suggest that you're probably in the wrong line of work.

Almost Great Moments in Science

Let's take a moment to celebrate the uncommon genius of  Ilya Ivanovich Ivanov.

What did Professor Ivanov do, you well may ask?

He was the first man to attempt to create a human/ape hybrid using artificial insemination.

Wikipedia calls this proposed beast a 'humanzee'. While this is pretty good, I personally would prefer 'humangatan', but I'll take either.

So how does one attempt to create such a monstrosity, well may you ask?

On February 28, 1927, Ivanov inseminated two female chimpanzees with his own sperm. On June 25, his son inseminated a third chimpanzee with his sperm. 

This guy is really trying to give Giles Brindley a run for the money in the stakes of 'most outrageous science experiments conducted on oneself'.

The Ivanovs left Africa in July with thirteen chimps, including the three used in his experiments. They already knew before leaving that the first two chimpanzees had failed to become pregnant. The third died in France, and was also found not to have been pregnant.

Boo-urns.

So putting human sperm into female chimps wasn't doing the trick. Did he just pack up and call it quits then? Oh no he did not!

Upon his return to the Soviet Union in 1927, Ivanov began an effort to organize hybridization experiments at Sukhumi using ape sperm and human females.... In the spring of 1929 the Society set up a commission to plan Ivanov's experiments at Sukhumi. They decided that at least five volunteer women would be needed for the project.

Great news, comrade sisters! The Party has selected you to 'volunteer' to be impregnated by a chimp. For the glory of the Soviet Union!

Okay, those women would have won hands down the 'human self-experimentation award'. 

However, in June 1929, before any inseminations had taken place, Ivanov learned that the only postpubescent male ape remaining at Sukhumi (an orangutan) had died. A new set of chimps would not arrive at Sukhumi until the summer of 1930.

Given that you haven't heard of humanzees, you can probably guess that things didn't work out.

In the course of a general political shakeup in the Soviet scientific world, Gorbunov and a number of the scientists involved in the planning of the Sukhumi experiments lost their positions. In the spring of 1930, Ivanov came under political criticism at his veterinary institute. Finally, on December 13, 1930, Ivanov was arrested. He was sentenced to five years of exile to Alma Ata, where he worked for the Kazakh Veterinary-Zoologist Institute until his death from a stroke on 20 March 1932. 

Lame. You can always rely on the commies to spoil everybody's fun.

This whole thing is apparently not as wacky as you may think:

In 1977, researcher J. Michael Bedford discovered that human sperm could penetrate the protective outer membranes of a gibbon egg. Bedford's paper also stated that human spermatozoa would not even attach to the zona surface of non-hominoid primates (baboon, rhesus monkey, and squirrel monkey), concluding that although the specificity of human spermatozoa is not confined to man alone, it is probably restricted to the Hominoidea.

Okay, so humaboons and humonkeys are out, but humibbons might be a possibility. How is nobody investigating this?

Frankly, I think there should be way more research into creative mixed breeds of animal. Consider some of the awesomeness we already know is out there:

Ligers and Tigons

Grolar Bears (or Pizzly Bears, if you prefer):

I think to stimulate interest, these need to be referred to as 'mashup animals'. Sure, the purists at the zoo think this kind of thing is an abomination. Tell it to Charles Darwin, you ninnies! Do you think nature cares about your foibles? Grolar bears occur in the wild, for crying out loud.

The singular advantage of the humanzee, however, is the possibility of a hilarious spectacle whereby earnest people debate whether current law requires that the humanzee be allowed to vote. At which point universal suffrage will have jumped the shark even more than you already thought was possible.

On the Supreme Court and Gay Marriage

-First and foremost, read the damn decision. Otherwise you'll be one of those absolutely insufferable people who view every court decision as a 'Gay Marriage Yay!' or 'Gay Marriage Boo!' pantomime. These people have zero conception that there actually is a question of law going on, and that a badly decided case with a desirable policy outcome will create other problems down the road that the pantomime crowd never think about.

You can find a pdf of it here. I heartily recommend reading Scalia's dissent, even if you're broadly happy that gay marriages in one state will now be federally recognised. In fact, you should especially read Scalia's dissent if you're broadly happy with the policy aspects of the decision.

-As I mentioned to you a few months ago, Justice Scalia predicted way back in 2003 that the Supreme Court was going to legalise Gay Marriage, and that Lawrence v. Texas (which overturned the Texas anti-sodomy statue) was merely a prelude to this result, the Court's protestations to the contrary notwithstanding.

Well, the Court this time decided not to settle the Elephant in the Room question of whether for a State to prohibit gay marriage violates the 14th Amendment equal protection clause  (which, if they did, would have decided the issue once and for all). Instead, it was held that for the Federal government to define marriage to exclude gay marriages in states which allowed them was a violation of the 5th amendment because it served no legitimate purpose and thus was a violation of basic due process. From the majority opinion:

DOMA instructs all federal officials, and indeed all persons with whom same-sex couples interact, including their own children, that their marriage is less worthy than the marriages of others. The federal statute is invalid, for no legitimate purpose overcomes the purpose and effect to disparage and to injure those whom the State, by its marriage laws, sought to protect in personhood and dignity. By seeking to displace this protection and treating those persons as living in marriages less respected than others, the federal statute is in violation of the Fifth Amendment. This opinion and its holding are confined to those lawful marriages.

In other words, we're not deciding the substantive issue of gay marriage, just one part of it. Roberts wrote separately just to emphasise this point:

But while I disagree with the result to which the majority’s analysis leads it in this case, I think it more important to point out that its analysis leads no further. The Court does not have before it, and the logic of its opinion does not decide, the distinct question whether the States, in the exercise of their “historic and essential authority to define the marital relation,” ante, at 18, may continue to utilize the traditional definition of marriage. The majority goes out of its way to make this explicit in the penultimate sentence of its opinion. 

In other words - listen up you lower court punks, don't think we've given you carte blanche to insist on gay marriage everywhere.

Scalia mocks the majority super hard for this feint of judicial modesty:

The penultimate sentence of the majority’s opinion is a naked declaration that “[t]his opinion and its holding are  confined” to those couples “joined in same-sex marriages made lawful by the State.” Ante, at 26, 25. I have heard such “bald, unreasoned disclaimer[s]” before. Lawrence, 539 U. S., at 604. When the Court declared a constitutional right to homosexual sodomy, we were assured that the case had nothing, nothing at all to do with “whether the government must give formal recognition to any relationship that homosexual persons seek to enter.” Id., at 578. 

I haven't forgotten Lawrence, you clowns.

Now we are told that DOMA is invalid because it  “demeans the couple, whose moral and sexual choices the Constitution protects,” ante, at 23—with an accompanying citation of Lawrence. It takes real cheek for today’s majority to assure us, as it is going out the door, that a constitutional requirement to give formal recognition to same-sex marriage is not at issue here—when what has preceded that assurance is a lecture on how superior the majority’s moral judgment in favor of same-sex marriage is to the Congress’s hateful moral judgment against it. I promise you this: The only thing that will “confine” the Court’s holding is its sense of what it can get away with. 

In other words - at least own up to what you're proposing, rather than maintaining this nonsense that this is all just about the solemn dignity of states to define marriage however they wish (a notion that will last about 5 minutes into the oral arguments for the next case).

I do not mean to suggest disagreement with THE CHIEF JUSTICE’s view, ante, p. 2–4 (dissenting opinion), that lower federal courts and state courts can distinguish today’s case when the issue before them is state denial of marital status to same-sex couples—or even that this Court could theoretically do so. Lord, an opinion with such scatter-shot rationales as this one (federalism noises among them) can be distinguished in many ways. And deserves to be. State and lower federal courts should take the Court at its word and distinguish away. 

Ha!

In my opinion, however, the view that this Court will take of state prohibition of same-sex marriage is indicated beyond mistaking by today’s opinion. 

If there's anyone in the country who disagrees with the last sentence, I'm yet to meet them.

-Laws are complicated things. I am quite certain that the vast majority of the people who are sure that the Defense of Marriage Act is a hateful piece of legislation designed only to injure gays have not tried to deal with the mess that is overlapping definitions of different terms when the laws of different jurisdictions come into conflict. Even the notion of a 'US Resident' is virtually impossible to get a clear answer on - there's tax residence, and immigration residence, and driving license requirements (which I've heard dozens of answers about) etc. So even if you didn't want to limit the federal definition to exclude gay marriage, there are plenty of other reasons why you might want a uniform definition. Scalia mentions some of them:

To choose just one of these defenders’ arguments, DOMA avoids difficult choice-of-law issues that will now arise absent a uniform federal definition of marriage. See, e.g., Baude, Beyond DOMA: Choice of State Law in Federal Statutes, 64 Stan. L. Rev. 1371 (2012). Imagine a pair of women who marry in Albany and then move to Alabama, which does not “recognize as valid any marriage of parties of the same sex.” Ala. Code §30–1–19(e) (2011). When the couple files their next federal tax return, may it be a joint one? Which State’s law controls, for federal-law purposes: their State of celebration (which recognizes the marriage) or their State of domicile (which does not)? (Does the answer depend on whether they were just visiting in Albany?) Are these questions to be answered as a matter of federal common law, or perhaps by borrowing a State’s choice-of-law rules? If so, which State’s? And what about States where the status of an out-of-state same-sex marriage is an unsettled question under local law? See Godfrey v. Spano, 13 N. Y. 3d 358, 920 N. E. 2d 328 (2009). DOMA avoided all of this uncertainty by specifying which marriages would be recognized for federal purposes. That is a classic purpose for a definitional provision.

If you are expecting the boosters of the recent decision to provide you with a clear answer to any of the above questions, I would advise you not to hold your breath.

-As for myself, I find myself broadly disliking the decision, but for conflicting reasons. As a matter of policy, I'm fine with gay marriage. If I were minded to vote (or registered to vote. Or allowed to vote), I'd vote to allow it. So to that extent, while it's not high on my list of priorities, I'm happy enough with the practical aspects of the outcome (subject to the previously mentioned practical concerns).

But I deeply hate judicial activism. It poisons the legal certainty that lets people organise their lives according to well-settled precedent. Democracy may have plenty of flaws, but the makeup of the current Supreme Court seems to have managed to reproduce most of the maladies and perversions, just on a micro scale. We've got 4 (mostly) conservative justices, not all of whom can be relied on to produce politically conservative outcomes, 4 consistently liberal justices who can unfailingly be relied on to produce politically liberal outcomes, and Justice Kennedy playing the role of the entire swing voting electorate -  inscrutable, unpredictable, and of principles that are, shall we say, difficult to forecast. The voters in this case are definitely smarter, but do you think the policies produced are better?

Judicial activism - combining all the disfunction of democracy, but without the benefit of the law of large numbers and De Moivre's theorem!

In other words, judicial activism is just one more manifestation of the many ways that this republic has decayed from the original founders' vision. I second the Moldbug critiques of such a vision, but it's certainly a zillion times better than the monstrosity we're currently saddled with.

At the risk of this post being an 'All-Scalia-All-The-Time' one, I cannot help but excerpt his closing remarks

We might have covered ourselves with honor today, by promising all sides of this debate that it was theirs to settle and that we would respect their resolution. We might have let the People decide. But that the majority will not do. Some will rejoice in today’s decision, and some will despair at it; that is the nature of a controversy that matters so much to so many. But the Court has cheated both sides, robbing the winners of an honest victory, and the losers of the peace that  comes from a fair defeat. We owed both of them better. I dissent.

As do I.

The dangers of reading the fake government org chart instead of the real government org chart

The problem with getting distracted and waiting several days to write about a story is that by the time you get around to it, the narrative you had in mind may have already been overtaken by events.

Athenios put me on to this story last week about how the conservative-led Greek government decided to abolish the national broadcaster. On fully four hours notice. Which is absolutely hilarious. Tired of a bunch of subsidised lefty whingers moaning about 'austerity'? Tired of paying money hand over fist for the privilege of such preening stupidity in the middle of the worst economic downturn your country has seen since the great depression? Think it's ludicrous to continue paying these nincompoops while pensions have been cut 40%?

Well, I would agree with you! Conservatives are often accused of having a ' go along to get along' tolerance of the ever expanding role of the state. When someone attempts a genuine rollback of some small part of the repulsive leviathan that is modern bureaucratic government, I cannot help but applaud. In addition, the move of shutting them down overnight, without any notice in advance, is surely a better plan than fighting for incremental cuts and waging month after month of the public relations equivalent of the battle of Dien Bien Phu. Machiavelli told you long ago that if pain is needed, better to bring it all at once:

Hence we may learn the lesson that on seizing a state, the usurper should make haste to inflict what injuries he must, at a stroke, that he may not have to renew them daily, but be enabled by their discontinuance to reassure men’s minds, and afterwards win them over by benefits. Whosoever, either through timidity or from following bad counsels, adopts a contrary course, must keep the sword always drawn, and can put no trust in his subjects, who suffering from continued and constantly renewed severities, will never yield him their confidence. Injuries, therefore, should be inflicted all at once, that their ill savour being less lasting may the less offend; whereas, benefits should be conferred little by little, that so they may be more fully relished.

If you strike at a king, strike to kill. So far so good, as of last Wednesday.

Unfortunately, kings do not always die so easily. How do you think they became King in the first place? I'm guessing that you, like me, probably imagined that you just turn off the damn power at the TV station, and that's that. It turns out that taking a public broadcaster off the air is not as straightforward as you might imagine. The first thing that happened is that the public broadcasters of the other European nations decided to continue broadcasting the now illegal Greek public TV from their own satellites. And I don't mean that François Hollande and Angela Merkel decided this. I mean that a bunch of EU public broadcasting bigwigs unilaterally decided to use taxpayer funded assets to intervene in the domestic disputes of a sovereign (ha!) nation. Strange, they don't talk about that kind of thing in civics class, do they?

Next, all the Greek journalists went on strike. As you do in Europe. Given they're not really inclined to work even at the best of times, it's not like they needed much encouragement. So now most Greeks aren't getting any perspective on the news except from ... you guessed it... Greek state TV, who continue to broadcast on the Internet, and now have dropped all pretense of neutrality and gone the full retard in terms of opposing the government. Where media leads, public opinion follows.

And in the most recent move, the courts come in to order the broadcaster be put back on the air. Thought you could shut down your own department eh? Wrong!

The net effect of this is that it's looking like this saga which started so quixotically may end up being the downfall of the conservative government. The main discussion now is about whether the government may be able to stave off the full scale collapse of their coalition if the prime minister resigns.

To begin with bluster and later take fright at the enemy's numbers, as the great Sun Tzu observed, shows a supreme lack of intelligence. The Government seemed to be of the naive opinion that the bureaucracy answers to the will of the elected representatives, and if their performance was sufficiently unsatisfactory, they could and should be fired, just like in any other company.

Joseph McCarthy thought the same thing. They were both wrong.

Postscript:

In a grimly hilarious sidenote, MSCI, the company who compile stockmarket indices for various countries, took the heretofore unprecedented step of downgrading the Greek market from 'developed' to 'emerging'. As MSCI noted:

Further,the MSCI Greece Index has not met the Developed Market criterion for size for the last two years. If it were not for an exception to the index maintenance methodology that requires the index to have at least two constituents, only one security would currently qualify for inclusion in the MSCI Greece Index.

Ooh, that's gotta burn.

The announcement is doubly comical for the absurd use of the euphemism 'emerging' in this context. As Athenios quipped, 'Emerging? More like submerging!'

The one ambivalently bright side of the NSA scandal(s)

The great Robert Fogel, sadly recently departed, noted in his discussion about slavery that the system was, for the most part, very efficient. One point he liked to emphasise is that people are so used to the notion of efficiency being applied to good ends that they don't consider the alternative possibility - efficiency as applied to evil in fact produces monstrous outcomes.

A similar tension exists in the way people understand the spy services. Whenever you see Hollywood depictions of the CIA (or just shadowy agents of some secret department, standing in for the CIA), 90-odd percent of the time they are displayed as having a sinister level of competence in their ability to pull off evil actions. They're everywhere, they see everything, and they can hunt you down. Of course, Jason Bourne wins in the end, but you're not left in any doubt that most of the time, the government gets its way.

This view eventually permeates a large amount of social thinking on the matter. Consider the 9/11 truthers - according to their claims, the government managed to organise a massive conspiracy to plant all sorts of explosives inside two skyscrapers, demolish them with people inside, make it look like planes were crashing into them on live television, and blame the Muslims. All while keeping this totally under wraps, except for the keen eyes of the producers of 'Loose Change'.

You could spend hours debating with these clowns about whether fire can actually melt steel, but it seems you might get much further by simply noting, 'Have you been to the DMV recently? What impression did that give you about the competence of the average government employee?'

This is the default Shylock rule - when you're thinking about the government, assume it will be run by folks at the DMV. Can you trust the government to clean up after Katrina? Think the DMV. Is it likely that the next round of financial regulation will prevent the next housing crisis? Think the DMV. Can you create police SWAT teams all over the country in rinky dink places and not have them consistently raiding the wrong houses while looking for marijuana? Think the DMV.

But... what about the CIA? Surely, if competence exists anywhere, it must exist there, right? When it really counts, when the chips are down, these guys are the pros, and they wouldn't screw it up?

Except, you know, with the Iraqi weapons of mass destruction.

The point of the DMV rule is not that it's always right. It's just that it tends to be a fairly good predictor of what's actually going to happen.

I wrote a while ago about the fact that before this latest news broke, you tended to read a lot of stories about Chinese hackers tooling on the US - hacking into Google, diverting all internet traffic to China, that kind of thing. You'd very rarely hear about any US operations - the only exceptions were cases like Stuxnet which accidentally got released into the wild. In other words, you'd hear about the good side of the program (the US is releasing a computer virus to screw up Iranian centrifuges for enriching uranium) at the same time as the bad (this wasn't meant to be in the papers, meaning the virus got found out).

When I didn't read anything about US Cyber operations, I applied the DMV principle and assumed that these clowns just didn't know what they were doing. But the alternative was always that they were so good at what they were doing that you never heard about it. Since, of course, you weren't meant to.

As it turns out, the NSA has been spying on Americans like J Edgar Hoover on a dirt-digging mission to cover up for his cross-dressing proclivities.

Say what you will about the ethics of these programs (and I tend to be considerably wary of them) - they don't seem incompetent. They seem scarily competent. They seem like The Bourne Identity, when in reality I was expecting a cross between Fawlty Towers and Yes Minister (except with everyone being like the Minister).

The bad news is that this the NSA seems to play extraordinarily fast and loose with the 4th amendment, and has enormous power to spy on American citizens in a way that would make the Founding Fathers spin in their graves faster than a virus-ridden Iranian centrifuge.

The good news is that for the fraction of the things the NSA does which are likely beneficial to the country (and even the most jaded skeptic would probably admit that this fraction is non-zero), they can hopefully apply the same level of competence.

And if you can actually get the privacy destroying parts of the NSA's work removed (which, sadly, you probably can't), this whole imbroglio might actually be good news.

In other words, the government may be negative NPV, but it's not pure evil. So jacking up competence will at least have some effects on the revenues side of the ledger.

Miscellaneous Irreverant Joy

And some fact to round it out:

Social trends I do not understand

Bumper stickers that announce 'My Child is an Honor Student at [XYZ] Elementary School'.

To me, this just seems to be the height of poor manners on so many levels.

Every time I see these stickers, I wonder 'Who exactly is this for?' The random guy behind you in traffic? Why the hell would he possibly care? At least with political bumper stickers, there's the justification of the theory, however misguided, that you might change someone's vote by implicit messaging (although to even state that idea out loud is to realise how ludicrous it is.) But here, it is impossible for the owner of the sticker to not realise that the world couldn't possibly care less.

And what message exactly are you trying to impart to John Q. Citizen, even supposing they do listen? There's two obvious implications of the sticker:

1. I am very proud of my child, whom I love dearly.

2. My child is very intelligent (and yours is not).

My responses to these would be:

1. No $#!7. That's so unusual for parents! Why not just get a sticker that says 'I love my children'? What's that, you say? Because it would sound ridiculous and obvious, like boasting that you always flush the toilet?

2. You're bragging about your child's grades? Do you realise how pathetic that sounds?

The second one, which I suspect is the point of the stickers, just seems so loathesomely gauche and shameless that it's hard to know where to begin. Suppose you're the type of person who loves to mention how much money they make, or how many women they've slept with, or what type of car they drive. You reach middle age, and every interesting thing you've done is getting further and further in the past. You need to justify your insecurities to a world that is passing you by. But sadly, it is getting harder and harder to find opportunities to just insert monologues about your accomplishments into conversation like a misguided V2 rocket aimed roughly at London. People are sick of the same stories about your long-ago glory days. How might you make up for the failed dreams of your youth?

Easy! Just get into vanglorious sloganeering about your child's accomplishments! Better yet, launder it all through the a cheap, see-through veneer of parental love and adulation. Nobody will ever spot the hidden subtext.

Putting a child's A+ test on the refrigerator is a sign of pride and love that the child will see.

Putting a crude boast about the same on your car is tacky and classless.

Head to Head

1. Pride or Pride?

2. Superman or Superman, as well as (to loosen the definitions a bit) Superman or Superman?

3. Somebody that I used to know, or Somebody that I used to know? (and for a rematch between the same artists, Easy way out or Easy Way Out?)

And for the bonus round, Ben Folds did an entire multi-round contest against himself on the 'Way to Normal' : The b**** went nuts or The b**** went nuts,  Free coffee or Free coffee, and a bunch of others.

The Hammer and I used to play this game a lot. My answers in the comments

The most logical software purchasers, on the other hand....

‘The Best-run businesses run SAP’

Let’s heroically assume that this statement is true.

It’s a long way from this statement to the statement they’re implying, which is that ‘The best-run businesses are well-run because they run SAP’.

It is an even larger stretch from there to the statement they actually want you to believe, namely ‘If you run SAP then you too will become one of the best-run businesses’.

It is depressing, but highly probable, that people too stupid to understand these distinctions are in charge of deciding enterprise software choices for major corporations. At a minimum, the marketing folks at SAP seem to believe that the people in charge of deciding whether to buy their products are actually fools.

Holger Danske

The statue of Holger Danske sits in Kronborg castle in Helsingør, Denmark. According to the legend, as told by the guide at Helsingør, Holger was a knight who was the son of the Danish King. He was lent to Emperor Charlemagne as a surety by the Danish King to guarantee the payment of a debt after the King unsuccessfully fought against Charlemagne in battle. The Dane didn't pay up, and after a few years Charlemagne was going to kill Holger. Right before the execution, a messenger came in saying that the border lands had been invaded, and the emperor left for the battle, taking Holger with him. While on the field, Holger came across a knight riding scared away from battle. Holger took his armor, and went into battle, fighting bravely for Charlemagne. At the end of the battle, Charlemagne went to congratulate one of his knights, and when he lifted his visor, he was surprised to see it was Holger. He decided to set him free. Holger began the long walk back to Denmark. When he finally arrived, he sat in a chair in the basement of the castle, waiting for the castle members to come back. He stayed asleep, and his beard grew so long it touched the floor. The legend concludes by saying that Holger dreams and sees all that goes on in Denmark, and will rise again to defend Denmark in its time of need against foreign invaders.

You can learn a lot about a culture from its mythology. The Danes were a fearsome, militarily powerful people. If they turned up on your doorstep in 1000AD, you would have done well to follow the advice of AC/DC to 'lock up your daughters, lock up your wife, lock up your back door and run for your life'. It would be trite, but nonetheless true, to note that the possibility of modern-day Danes (or indeed any of the Scandinavian descendants of the Vikings) inspiring the same response is ludicrously, preposterously unthinkable. And this holds true no matter how large a military force they were commanding - the shift is first and foremost in mindset.

Holger Danske still inspires Danish people though. The great Hans Christian Andersen wrote a short story about it. The Danish resistance group in World War 2 named themselves after him. But it does so because of the history. The story on its own strikes a strange chord that clashes with modern sensibilities. Even if this were the age of legends, I cannot imagine a story like Holger Danske resonating enough today to get started and spread through the populace, were it not already a famous story.

The notion of military heroism is largely an anachronism in the West. The ideal modern image is the soldier as a brave and tragic victim. They are noble when killed or injured. They are suffering when separated from their loved ones, and selfless in their sacrifices. Even the right buys into this narrative to some extent. We must 'support our troops'. You hear this more than that we must 'celebrate our troops'. The stories about troops that resonate are those of pathos. We want to hear about the man who died bravely on the battlefield to save his companions, not the guy who bravely kicked tons of enemy ass and lived unscathed to tell the tale.There's no shortage of stories of incredible bravery in Iraq or Afghanistan. But for some reason, you mostly hear about them in the context of soldiers who have died. The heroism is mainly there to add poignancy.

Holger Danske is old fashioned because it envisages a natural warrior aristocracy. In an age of radical egalitarianism, we can have 'heroes', but not a 'hero'. Because most people will never be truly heroic in their whole lives, the whole concept must be sufficiently diluted to cover nearly everybody. Today, you are a 'hero' for volunteering in a soup kitchen, or doing an AIDS fun run. What word, then, would you use to describe Simo Häyhä? Or Ben Grierson? Or, indeed, Holger Danske? He's not administering to the needy, he's not interested in being a glorious victim in a fatal last stand. He's interested only in kicking enemy ass on your behalf to keep the land safe for those of his countrymen without his courage, strength or skill. And that is what modern man truly cannot abide - the implication that nature has furnished us with natural betters, and we should celebrate and admire them, and be grateful when they lead our country to great achievements. They are not servants of the public. They are kings, ruling over us by right of their strength of character and proud lineage.

We live indeed in a Kingless age.

Morgan Stanley is not your friend

Not if you are their client. Not if they're underwriting an IPO you're purchasing. And certainly not if they're just trading on the other side of the market against you.

What, did you expect something else? Is this surprising to you?

Then I have bad news for you. You have no business picking your own shares to day trade in equity markets.

The Greek sent me this interesting Atlantic article about the debacle surrounding the Facebook IPO.

It's rather long, and I have mixed feelings about it, so let me give you the quick version.

Facebook had a big IPO coming up. As the date neared, they realised that revenue projections were going to be lower than expected, because more people were switching to (low ad revenue) mobile services than they'd forecast. They released a form with the SEC that buried this news while meeting technical disclosure requirements. Institutional investors figured this out from their brokers and banks. Joe public did not.

There's an interesting story here, but I found it hard to get through, because it started in the following manner:

Uma Swaminathan tuned the television set in the living room of her ranch style home in the suburbs of East Brunswick, N.J. to CNBC. It was 9:00 a.m. on May 18, 2012, a day the retired schoolteacher thought might make her rich. She logged onto her Vanguard brokerage account on her computer and placed an order for 5,000 shares of Facebook at $42 a share.

Like a bad movie, I already knew how the rest of this was going to play out from the first paragraph. The author clearly has sympathy with the lady in question, and invites the reader to as well.

With short hair, brown skin, and few wrinkles, Swaminathan looks much younger than her 68 years. She spent most of adult life as a suburban mom, making tofu for her daughter's friends at theater rehearsals, taking her three sons to soccer practice and Boy Scouts, and volunteering in the local community. She served a term as president of the Indian American Association of New Jersey.

My immediate responses are threefold:

1. These sound like admirable things to do.

2. A similarly glowing list could be compiled about just about anybody.

3. If this is story about financial markets, what about the above listed background made her think she was an ideal candidate to start trading actively?

Her interest in the stock market didn't develop until her husband died about 13 years ago. Her four children had already moved out to attend college or to pursue their careers. Swaminathan was left with her late husband's 401(k) retirement account, when she started dabbling in the market, investing in stable companies like Microsoft. Not long after, she began to follow the news coverage of initial public offerings (IPOs) -- when private companies enter the public market -- and came to know of the phenomenon known as the first day "pop." On the day that companies would debut on the stock market, the price would tend to shoot up before stabilizing. A year earlier, she watched as social networking site LinkedIn's stock price closed up 109 percent on its opening day.

Okay, we're going to hear a lot of sympathetic stuff later in the article. But let's just unpack some of these statements. Roll the tape again:

[She] came to know of the phenomenon known as the first day "pop." On the day that companies would debut on the stock market, the price would tend to shoot up before stabilizing.

So IPOs historically go up, on average (we'll come back to that phase in a second) on their first day. So what? Do you think that you're somehow owed a large first day return? For what? What did you do to earn them?

And in a question that might be viewed as immensely patronising, except for everything revealed by her subsequent actions: do you think that positive average returns are the same as uniformly positive returns?

Financial markets combine two distinct roles. There is a positive sum problem of real resource allocation - prices send signals about which companies should be able to expand their operations, and what the economy should produce more of. But there is also a zero sum problem of trading - if I buy and the share goes up, I make money relative to the alternative case if I hadn't bought. But the guy I bought it off loses money relative to if he hadn't sold.

So this woman might have made money. But who would have lost? Whose story is not being told here?

Most of the time, the company who sold it to her. The standard answer in the finance literature is that IPO underpricing is about companies getting ripped off by their unscrupulous advisors. So finally, the academics get their way, and Facebook is definitively not ripped off with its IPO price. So instead the story gets written about the woman who bought the Facebook shares and lost money. But that's inevitable - if someone makes money, someone else loses.

[Diversion: Academics have written hundreds of papers on the reason IPOs are "underpriced" because of the first day pop. But really, do you think CEOs look at stories about the 'biggest IPO flop ever' and think to themselves, 'Wow, that's what I want! That Zuckerberg guy managed to get absolute top dollar for his worthless shares!'. And if they don't, can you really blame them?]

But it's more than that - the woman wasn't buying shares in the IPO from Facebook, but in the open market. She was buying them off some other investor. Maybe she was buying them from Goldman. Maybe she was buying them from some other small investor who doesn't get an Atlantic story written about them. Who knows.

The point is, suppose she'd made money. Someone else sold too low immediately on the open. Would you feel equally sorry for them? Maybe if they'd gotten a glowing article written about how they volunteer at their local soup kitchen or whatever, but ordinarily, no, you wouldn't.

As the grievance studies professors are fond of saying - some narratives are privileged, and others are not.

Let's jump back to a statement at the beginning.

[O]n May 18, 2012, a day the retired schoolteacher thought might make her rich.

You thought you'd get rich trading IPO stocks as a retired schoolteacher.

The Greeks have a word for the feeling I experience reading those words, and it is catharsis.

She'd never placed such a big bet on just one stock, but she felt a personal connection to Facebook. She had been using the site to connect with family and friends since 2009, and almost everyone she knew had an account.

...

Facebook shares hit the market at an opening price of $38. Minutes later, Swaminathan's online order was executed, and the retired schoolteacher had just spent approximately half her life savings.

You put half your God damn life savings into a single stock? And an IPO stock at that? Are you out of your mind?

First of all, this shows that you have absolutely no idea about even the very basics of finance. Idiosyncratic risk? Diversification? Anyone? Anyone at all?

Second, it shows that you don't even understand the strategy you're implementing. IPO underpricing is a statement about average returns to a strategy of buying a ton of IPO stocks. It is not  a strategy for putting all your money into a single stock. If you are counting cards in blackjack, you want to place lots of bets over and over because the odds are in your favour. You do not want to put all your money on one hand. If you don't understand this, again, you don't understand the very basics of finance. 

I want you to remember this, reader. Because there's an entire article about how this is all JP Morgan's fault, and Vanguard's fault, and NASDAQ's fault, and FINRA's fault.

Madam, I submit to you the following - your belief that you would make tons of money by putting half your life savings into Facebook stock was not something you learned from JP Morgan, or Vanguard, or NASDAQ, or FINRA. It was not something you got from financial academia, or textbooks, or even moderately sophisticated blogs. I don't know where you got it. I suspect from naive extrapolation.

Don't get me wrong. There is another side to the story, one about investment banks giving selective advice to their favoured clients and the game being rigged against small investors. This is all true. But you don't need me to tell you that story - the whole article is about that. We can argue about what, if anything, should be done to fix this problem.

But to my mind, this is just a smokescreen. Why?

Because if you're putting half your life savings into a totally fair and not rigged IPO stock, there's a large chance that the story would still have the same ending. That's what happens when you take a huge bet on a single volatile asset. If I had to hazard a rough guess without looking at the actual data, I'd say it's a bit less than a 50% chance for a one-off bet, since IPO stocks do rise on average on the first day. But if you're doing this strategy multiple times, it starts becoming way more likely.

Financial markets are like a circular saw. You can use them to fashion a beautiful oak table if you know what you're doing.

You can use them to chop your own leg off if you don't.

You may think this is all rather harsh. Some poor woman still lost a ton of her life savings. Don't I feel sympathy for her?

Of course I do. It's a tragic story. She clearly had no idea what she was doing, and got fleeced by Wall Street.

As the great Theodore Dalrmpyle put it, people can both be figures of sympathy and also acknowledged as being significant architects of their own misfortune.

One can, in other words, be a victim, but also partly responsible. The two are not at all contradictory.

And this is worth mentioning, because this is not really a human interest story. It is, after all, a policy story. The author wants you to believe that this unfortunate woman's losses are primarily the fault of Wall Street Greed and Crony Capitalism.™ More taxes on crooked banks! More regulation!

The real problem here is the one that the author doesn't want to talk about - there are plenty of individuals investing in financial markets who have not the vaguest clue what they are doing, and a number of them are going to lose a lot of their life savings.

One way to deal with this is to load up on paternalism - only let sophisticated people with demonstrated knowledge trade. This might solve the problem. Then again, it might not. It would also come with a number of undesirable side effects.

The other way to deal with this is reflect on the sad and imperfect universe we live in, and the wisdom that the Gods of the Copybook Headings would have told us, much more in sorrow than in scorn:

"A fool and his money are soon parted."