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Monday, May 8, 2017

The imaginary apocalypse of the reactionary right

by John MacBeath Watkins

Donald Trump campaigned by constantly talking as if America were an apocalyptic wasteland.

In April, his Justice Department issued a press release claiming New York City is soft on crime.

“New York City continues to see gang murder after gang murder, the predictable consequence of the city’s ‘soft on crime’ stance,” the press release, aimed at New York's status as a sanctuary city, stated.

New York is experiencing near-record lows in crime, and and its murder rate is about 1/6th of what it was when the Edward Byrne Memorial Justice Assistance Grant Program was established. The Justice Department is threatening to defund the program if New York does not end its sanctuary city status.


The program is named after a police officer who was shot while guarding an immigrant targeted by gangs for reporting their crimes. City police departments need the trust of the people who they ask to report crimes, which s why they are often not eager to be recruited as part of the mechanism for deporting some of those people.

Most people see the dropping crime rate and the general prosperity of the country and consider that things are not all that bad here. Trump and other reactionaries see a wasteland.

Andrew Sullivan recently interviewed a number of people who pass for intellectuals on the reactionary right for an article in New York magazine. They sound pretty bonkers.

Charles Kesler, for example, is a professor at Claremont McKenna College in California. He believes that we are at a crisis in American democracy. He wants to return to the rule of a party like the Republicans of the 1920s, and to a policy of limiting immigration, as the 1924 Immigration Act said, “that which can be assimilated with reasonable rapidity, and to favor immigrants whose standards are similar to ours.”

Perhpas Kesler is unaware that the law he so admires was one of the proudest accomplishments of the Ku Klux Klan, or at least they liked to take credit. Here's a Klan cartoon from 1924:



Note the goals: restricted immigration, militant Protestantism, better government, clean politics, “back to the Constitution,” law enforcement, better schools, and “greater allegiance to the flag.”

They didn't actually use the term, "drain the swamp," but their stated goals were very similar to the current crop of reactionaries.

Certainly the founding fathers would have had no objection to better schools (although I'm pretty sure they would have found Betsy De Vos, with her rejection of empirical data, objectionable) but they definitely would have rejected any effort to make a particular religion and would have realized that the "clean politics" claim was just a way of attacking incumbents, and the Klan didn't actually care about corruption if it made them and their allies more powerful.
Far from wanting to preserve the ethnic identity and culture they had, they wanted to mix in more foreigners. But then, they were men of the Enlightenment. They believed reason and ideas were more important than ethnic identity.

Reactionaries like to think that American democracy is at a crisis not just because of immigrants and multiculturalism, but also because "the administrative state," and liberal elites -- scientists, journalists, academics, as well as career government employees, has in some way hijacked government.

And here is where the apocalyptic vision comes in.


In Sullivan's piece, Kesler describes why he backed Trump.


It was an act of desperation, he explained. In classic reactionary fashion, he believes that we are living through a crisis of American democracy. The Claremont consensus (to put a name on this strain of thought) holds that beneath the veneer of constitutional democracy, we are actually governed by a soft despotism of permanent experts, bureaucrats, pundits, and academics who ignore the majority of the American people. This elite has encouraged a divisive social transformation of the country, has led us into disastrous wars, and has created a deepening economic crisis for the middle class. Anyone — anyone — who could challenge this elite’s power was therefore a godsend.


Now, it's true that we have elites in this country. They are no longer rich planters who own slaves, more often they are people with advanced degrees in understanding the problems we face. The British became comfortable with this group of people, and called them Mandarins -- the career people who served under elected officials of all parties.

There is an obvious danger in defining anyone with a deep understanding of the nation's problems as the enemy. If you rely on the knowledge of non-experts, you may be faced with the sort of thing H. L. Mencken was talking about when he said, "Explanations exist; they have existed for all time; there is always a well-known solution to every human problem — neat, plausible, and wrong."

More worrying than Kesler's views are those of some of his fellow travelers.

Michael Anton, who like Kesler and some other reactionaries is a student of Leo Strauss's work, is known for an essay in which he compared the situation of American democracy as being like being on Flight 93, the 9/11 aircraft that was hijacked for use as a missile aimed at Washington, D.C., but whose passengers charged the terrorists and brought down the plane.
 “Charge the cockpit or you die. You may die anyway. You — or the leader of your party — may make it into the cockpit and not know how to fly or land the plane. There are no guarantees. Except one: if you don’t try, death is certain.” It’s not just that Trump is better than the alternatives: “The truth is that Trump articulated, if incompletely and inconsistently, the right stances on the right issues — immigration, trade and war — right from the beginning.”
Well, I did say they sounded bonkers.

The election and governance of President Obama seems to have been considered an apocalyptic event by these particular reactionaries. Anton, for example, has succumbed to the notion that Obama ruled in an unconstitutional manner. From Sullivan:

What he calls “Caesarism” is already here, as Obama’s abuse of executive power proved. Therefore: “If we must have Caesar, who do you want him to be? One of theirs? Or one of yours (ours)?” Krein put it even more plainly: “Restoring true constitutional — or even merely competent — government requires a fundamental transformation of the underlying culture and elite opinion. It requires, in a certain sense, regime change in America.”
(Krein  here is Julius Krein, another Straussian scholar.)

The notion that President Trump will usher in more competent government is one of the more bonkers notions this crew has. Trump has proven to be a weak president despite his party controlling both houses of congress because he simply does not understand the powers of the president. He is a would-be strongman who is limited by his own incompetence.

The truth is, these reactionaries could not accept the legitimacy of a black president. Therefore, any use of power by that president must have been illegitimate. Any use of executive power by Barack Obama had to be an "abuse of power."

The reactionary moment in American history is not about abuse of power. In fact, people like Anton want to see exactly that, but in pursuit of their own goals.

Perhaps the country will get its fill of reactionary sentiment, and we can move beyond that. But having an intellectual movement that is unashamedly reactionary is one more indication that democracy is in danger.

Tuesday, May 2, 2017

A brief history of book theft in Seattle

by Jamie Lutton

Book theft has a curious history. It has been going on since the Middle Ages, when handwritten books were chained down to prevent it. But what I saw in my years working for others, then in my own store, was co-ordinateed efforts to steal wholesale and resell, often by addicts.

This was at it's worse, before Internet sales closed a lot of stores here. Addicts would steal from new bookstores (or stores that had books in them, new, like grocery stores) then try to sell them to used bookstores. This necessitated the installation of security systems of various kinds - tags in books, and checking bags.

Some few bookstores added to the problem.

A now deceased bookseller in our University District was an outright fence.

Starting 40 years ago, to the late 1990's, He gave lists of books he wanted to thieves. Most of them were hipster/homeless junkies who did not mind sticking it to ''the man'' to get heroin money. The thieves would go to bookstores only down the block, like Magus Books, the Twice Sold Tales that was in the University district, and the University bookstore, fill their bags, and dash out.

The long suffering owner of Magus, for example, would walk in, or send and employee down and ask for his books back, and the scoundrel would hand them over to avoid jail. If the bookstore that got ripped off didn't know about the theft, the man would happily sell them.

That bookseller is a tale unto himself. He - who will remain nameless here - chain smoked in his books store, and was frequently napping on an old brown ratty couch. He had REALLY young girlfriends hanging around him, even in his 50's. Had a deep smoky voice rather like Jack Nicholson, was tall and rangy, but a real Fagan as far as ethics go.. I shelved books for him in the early 1980's, for about two months, and saw this all going on around me.

Desperate for a job in Seattle, I hung on, until I was replaced by a very very young girl. The store had cute black and white cats and good books, so the public ignored the cigarette smoke and the other sketchy aspects of the place, and kept it going for decades.

Once I saw him get really lit and just start giving away stock; if someone liked the book, he would hand it over. He would also buy rounds for the house at his favorite bar. The party only ended when the feds found out he hadn't paid payroll taxes for a quarter century.

These professional shoplifters taught this method of living to other junkies, from that time to now, The theft was so outrageous in the 1990s that theft alone put small new bookstores out of business, and larger ones like mine put in elaborate security systems. Backpacks full of books were swiped, usually very popular fiction, and art books, and drug culture related books (surprise).

To this day, nearly every day someone still tries to sell me ''hot'' books.

One man, just a few years ago, who had given me his business card as a physical therapist (I had recently been hit by a car) came to me with a backpack full of graphic novels. I nearly bought them, but then looked at the date on the tags on the back, and they were all from last week or so from a store down the street. I politely turned them down.

One of the problems with turning down stolen books when offered is that junkies get angry with you. I have had death threats for not buying stolen books. I don't have a camera system yet, because of the Orwellian implications of that. Yet. I usually say now 'no I have copies of those' and then write down the titles after they leave, and put a report into the Stolen Book Network online.

The Stolen Book Network may be unique to Seattle; I called a few Denver bookstores, both new and used, and they said that they did not have a problem with systematic theft like we do here.

Over 20 years ago, in the face of a scourge of organized theft from bookstores, both new and used,

Seattle bookstores of all kinds developed a loose confederation which would exchange emails with descriptions of the books that had been stolen, offered, or photos of people caught stealing.

What The University bookstore does, is take is take pictures of shoplifters they catch and charge, and send them around to other stores so that they are on the lookout for that person,and don't let them in the store. Also used bookstores get photo ID and xerox it, to pass on if the books are found to be hot. These punks have no clue. One young man offered me his photo ID to be copied, and openly sold me a stack of textbooks that he had, as it turned out, just been swiped from the Seattle Central Community College campus bookstore a scant 2 blocks away. I returned the books, and the weary manager told me that theft was so bad, that they could only open that part of the store of one week of the year because they were being looted. .

Some of the larger chain bookstore rely on in house security to stop thieves, and cameras, but are still victimized regularly.

The trick is not to believe sob stories on where people say they got the books. This takes a gimlet eye, and a firm but polite no.

I can be fooled, when it is 4 books and the customer looks like he could have bought them.

It is when they come back with more of the same, and they are all shiny and new, that you know you have been had.

In the old days, before the Internet and the network, when I would catch a shoplifter, I would snap a picture of the thief blow it up with a color xerox, and post it in my plate glass window, instead of calling the cops, so that that person would know not to come in. yeah, and to shame them.  I would chase shoplifters too, as I was younger and stupid. My personal record is 8 blocks, but I think he was a smoker, which is why I could keep up with him.

That kid had asked for a book,then dashed out the door with it, and I was teed enough to go after him.

Another time this happened I grabbed some large male backup and went looking for the thief, and he made the sign of the ''evil eye'' when I fluently cussed him out for ripping me off. as he reluctantly handed the book back. .

The combination of casual theft for personal use, and theft to feed a drug habit has plagued my shop and others in town for 30 years.

This problem fortunately has sharply dropped off as used bookstores have vanished. So few of us pay cash nowadays, that addicts have branched out to stealing other retail objects to support their habit,

For example stealing expensive dry goods like batteries, and such and reselling them to unscrupulous small five and dime stores.

This is so bad locally a ring doing this was broken up just a few years ago that was fencing boxed diapers, batteries, and other must haves to a large independent shop that was , like that bookseller decades ago, was giving out lists.

I recently developed a cultural theory on this. As an cultural anthropology major, back in the day, I was curious what gave the masses mental permission to commit casual and addiction driven theft. I blame the book Steal This Book by Abbie Hoffman for the origin of this pattern.

This book, published in 1970, was a handbook on how to steal anything you wanted, with techniques shown in crude drawings in the books. It blithely claimed that this was all ok, as business owners were ''the man."

Theft of all kinds from shops skyrocketed after that. Even to this day, when I remark to young customers about why I have to check bags, some calmly say oh ''people' would not steal from YOU only ''big stores''. Which exhibits a total ignorance of how profit margins work for all shops big and small, and where jobs come from.

This is part of the running gag I have with customers which ends ''and you wonder why all the shops have vanished and gone online."

The casual disrespect of private property, and the lust to get free stuff has ruined the contract between me and the public. I know that I will have a lot of shrinkage, and that is because what I am trying to do is not respected by some in the general public.

When people complain that there is no shops near them, it is not just the rents, it the heartbreak of knowing that well-fed prosperous young people have no compunction to just walk away with product.

This drives people to find other kinds of work, or just sell online.

Between Internet companies that drive prices down, to high rents, to theft, a lot of start up entrepreneurs look at the modern situation, and don't go into retail of any kind.

Monday, May 1, 2017

Nonsense Poem: The Squirrels are Quoting Shakespeare

by John MacBeath Watkins

The squirrels are quoting Shakespeare
to each other in the park
while the moon falls from the heavens
as he stumbles in the dark
the stars fade in their spotlights
in a sky as cold as stone
while the paparazzi
fight over a bone
and the dogs bay and the cats spray
as they try to claim the new day
and birds soar on wings sore
from battling the broken wind
while the sun comes up like plunder

spreading gold upon the shore.

"Little Nemo in Slumberland" - Winsor McCay by docarelle, via Flickr

Sunday, April 2, 2017

Debasing language as a political strategy

by John MacBeath Watkins

One of the biggest aspects of Russian involvement in the 2016 presidential campaign is fake news, that is, deliberate deceptions promoted on social media or "news" sites like Brietbart as propaganda to influence people predisposed to believing weird things.

And one way of derailing that narrative is to redefine "fake news." President Trump has been doing this by labeling any news story that shows him in a bad light as "fake news."

The original meaning of "fake news" was stories like the one about the Clintons running a child-sex ring out of a Washington, D.C., pizza parlor. What Trump labels fake news is more like the leaks coming from the White House, for example calling leaks about Michael Flynn's contacts with Russian officials after the election and before Trump took office as "fake news."

The fact that Flynn's actions were proven to be true did not disrupt his insistence that this was "fake news."

Most often, he uses this technique when talking about reports of his campaign's possible collusion with Russian intelligence and propaganda organizations. At this point the main way we are aware of that the Russians tried to influence the campaign was with fake news, and distorted news, aimed at people who it seemed possible to influence.

The Russians seem to have waged information warfare through Twitter, Facebook, and other outlets. Some of this was done by trolls, actual human beings who had accounts made to appear that they were of the same social group as the people they aimed to influence, some were bots, software that automated the same process.

An example reported by Politico is the following tweet:

 @Flossy_gurl tweeted, “CORRUPT #FBI #JamesComey Received Million$ From #ClintonFoundation- Brother’s Law Firm Does #Clinton’s Taxes.” 

Certainly not true, intended to muddy people's thinking and get them to be cynical about our political class, and an actionable slander, if you could sue a bot.

This is a problem for Trump, and his response is ingenious. If fake news is a problem for him, muddy the thinking about fake news by labeling things that are true, and reported by major news organizations, as fake news, putting them on the same level as the Russian bots' tweets.

His goal is the same as that of the Russian bots and trolls, to undermine peoples' faith in the institutions of democracy so that they become incapable of responding to the threat.

Trump remains an expert flim-flam man, and his inability to actually run the government is, from a Russian point of view, an asset. After all, what could undermine peoples' faith in democracy more than a government unable to address their problems?

So, from the Russian point of view, they are still winning the information war, and the more it appears that Trump is in over his head, the more they win. I don't think they'll get tired of winning.

And at this point, Trump is in so far over his head, he's seeing deep sea anglerfish.



Friday, March 24, 2017

Our new shop cat has a name!


by John MacBeath Watkins

Beau Geste is the name for our new cat. It was the name of the titular character in a book by P.C. Wren, an adventure novel in which Beau gives everything for the sake of honor. Beau is a very sincere and dignified cat, which is what made me think of it.

Monday, March 20, 2017

The Ballard TST has a cat!

by John MacBeath Watkins

We are happy to announce that Twice Sold Tales in Ballard now has a shop cat. He is as yet unnamed, but he is a tuxedo cat with all the dignity that implies.

He's been here about 24 hours at this writing, and is already seducing customers, especially the ones who ignore him.

This picture shows him hiding behind the sign in the west window shortly after his arrival. He's already knocked over books, gone into an area I'd prefer he didn't, all hallmarks of a proper shop cat.

Once he became convinced that I didn't intend to eat him, he crawled right into my lap. He's a brown-eyed handsome cat, but we've already had one named after Chuck Berry.

It's been years since I've been able to have a shop cat, and I"m over the moon about it. Our new cat is about a year old, so he'll be with us for years yet.

Any suggestions for a name?

I had, or course, thought of the Song of the Jellicle cats, from Old Possum's Book of Practical Cats, but it doesn't fit him, because he is not "rather small." He's long and slender. But just for old time's sake, here's the poem:

    The Song of the Jellicles
    Jellicle Cats come out to-night
    Jellicle Cats come one come all:
    The Jellicle Moon is shining bright -
    Jellicles come to the Jellicle Ball.
    Jellicle Cats are black and white,
    Jellicle Cats are rather small;
    Jellicle Cats are merry and bright,
    And pleasant to hear when they caterwaul.
    Jellicle Cats have cheerful faces,
    Jellicle Cats have bright black eyes;
    They like to practise their airs and graces
    And wait for the Jellicle Moon to rise.
    Jellicle Cats develop slowly,
    Jellicle Cats are not too big;
    Jellicle Cats are roly-poly,
    They know how to dance a gavotte and a jig.
    Until the Jellicle Moon appears
    They make their toilette and take their repose:
    Jellicle Cats wash behind their ears,
    Jellicle dry between their toes.
    Jellicle Cats are white and black,
    Jellicle Cats are of moderate size;
    Jellicle Cats jump like a jumping-jack,
    Jellicle Cats have moonlit eyes.
    They're quitet enough in the morning hours,
    They're quitet enough in the afternoon,
    Reserving their terpsichorean powers
    To dance by the light of the Jellicle Moon.
    Jellicle Cats are black and white,
    Jellicle Cats (as I said) are small;
    If it happends to be a stormy night
    They will practise a caper or two in the hall.
    If it happens the sun is shining bright
    You would say they had nothing to do at all:
    They are resting and saving themselves to be right
    For the Jellicle Moon and the Jellicle Ball.
    T. S. elliot

Tuesday, March 14, 2017

Language and political manipulation: Why everyone is reading 1984 again

by John MacBeath Watkins

My bookstore started running out of copies of 1984 immediately after Kellyanne Conway used the term "alternative facts" to describe a lie told by presidential spokesman Sean Spicer.

That was on Meet the Press, Jan. 22, 2017. People really needed to start reading it sooner, such as in 2008, when Paul Gottfried first used the term "althernative right" to refer to white supremacists.

That proved to be the most successful bit of rebranding since the Rapeseed Association of Canada realized in the 1970s that women would be more willing to buy rapeseed oil if it were called canola oil.

Consider the case of Steve Bannon, President Trump's chief strategist and a member of the Principles Committee of the U.S. National Security Council. Prior to attaching himself to Donald Trump during the primaries, he ran a "news" organization called Brietbart, which he described last year as "the platform for the alt-right."

Had he described Brietbart as "the platform for white supremacists," would Trump be able to have him as his closest adviser?

And Bannon is now engaged in a new exercise in rebranding. At the Conservative Political Action Conference Feb. 23, Bannon said that President Trump made all his cabinet appointments with the goal of the "deconstruction of the administrative state."

Prior to that speech, deconstruction meant to apply a particular brand of critical theory to the reading of texts. Here's the Merriam-Webster definition:

1. a philosophical or critical method which asserts that meanings, metaphysical constructs, and hierarchical oppositions (as between key terms in a philosophical or literary work) are always rendered unstable by their dependence on ultimately arbitrary signifiers; also: an instance of the use of this method -- a deconstruction of the nature–culture opposition in Rousseau's work.
2. the analytic examination of something (as a theory) often in order to reveal its inadequacy.
This is clearly not what Bannon meant. Trump did not appoint Scott Pruitt to be administrator of the Environmental Protection Agency so that he would perform some sort of literary criticism of the agency. He's there to destroy it. He is there to ensure that our air and water become polluted, much like what Bannon and Conway are doing to our language.

Bannon is rebranding "destroy the government of the United States" as "deconstruction of the administrative state." That sounds so much more civilized, even abstract. Destroying the government sounds like treason, and to people reliant on the government for keeping the country peaceful, prosperous, and a reasonable place to live, it would sound likely to create chaos. Telling voters you were trying to destroy the government would be about has helpful as a canola farmer trying to impress his date by saying he was in the business of producing rape oil. Except, of course, that if his date knew what he was talking about she wouldn't mind, whereas if voters understood what Bannon was saying, most would be appalled.

But "deconstruction of the administrative state," now, that sounds really intellectual. Let's try to keep up with the development of the Trump administration's Newspeak, shall we? After all, we don't want to commit thoughtcrime.

We can begin our glossary of Trumpspeak:

Administrative state, noun, the agencies of the executive branch of the government.

Alternative fact, noun, A lie.

Alt-Right, noun, white supremacist.

America first, noun, originally a movement in the 1930s and '40s that thought America should not oppose fascism. Used by Trump and his surrogates as a term for a 21st century movement that feels America should not oppose fascism. Alternatively, a person who cooperates with the intelligence apparatus of a hostile foreign power to win public office.

Birth certificate, noun, a talisman of authenticity that, even when produced, cannot be real.

Coastal elites, noun, people who possess expertise, regardless of location.

Corporatist, noun, A word that had several meanings prior to Trump. He and his seem to have borrowed the left-wing meaning of a corruption of public policy by business interests, a sort of crony capitalism, except that the Trumpettes only use it to describe people who are not cronies of Trump. They might give the example of George Soros as a corporatist, but never Charles or David Koch unless they cross Trump.

Criminal enterprise, noun, a non-profit organization that spends its money on good works, rather than using it to buy politicians.

Deconstruct, verb, to destroy.

Disaster, noun, a successful government program.

Dishonest, adjective, used to describe people who report accurately on Trump.

Economic nationalism, noun, a policy of political bluster intended to conceal ignorance of how economies actually work.

Enemy of the people, noun, a reporter or news organization that does not propagandize for Trump.

Fake news, noun, a term that once meant lies intended to mislead, used by Trump and his surrogates to mean reporting facts that are inconvenient to Trump.

Globalist, noun, people who are not economic nationalists.

Loser, noun, a person who is not Donald Trump.

Radical Islamic Terrorism, noun, a magical phrase which, if said with sufficient conviction, will cause our enemies to humbly surrender.

Saying it like it is, verb, saying what you think people want to hear.

Strong leader, noun, either a foreign dictator or a blustering, insecure person who obsesses about the size of his inauguration crowd.

Truth, noun, a lie that confirms prior bias.

Unwatchable, adjective, a television show that Trump watches and reports on to his audience..


Orwell's pioneering work in his 1948 novel has given us a framework, but it will take years to assemble a workable glossary of Trumpism. Please add to the comments list any words and definitions you think should be added.

Sunday, March 5, 2017

If no one sees him, does Trump exist?

by John MacBeath Watkins

It is hard to understand Donald Trump's unhinged tweets about his Trump Tower phone being tapped on President Obama's orders. Has he lost touch with reality? Is he trying to recast himself as the victim in the Russian affair? Is he a paranoiac in addition to being a narcissist?

All or none of these things may be true, but my theory is that the main motivation was that people were, in the wake of the sort-of-state-of=the-union speech, starting to talk about him as if he were a normal president, the kind that isn't so dramatic that we have to focus on him all the time. The kind of president who will be an effective executive managing the United States executive branch.

Trump has never shown he can manage anything. Instead, as Trump biographer Tim O'Brien said recently,  “He’s a performance artist pretending to be a great manager.”

And as a performance artist, for Trump the measure of how he is performing as president isn't how well the country is doing under his administration. The measure is how much people are paying attention to him.

When people breathe a sigh of relief, relax their gaze and turn to other matters in their lives, he panics.

President Trump is a man so insecure, he seems unwilling to test the question of whether he exists when no one is watching. I have to wonder if, when people start turning their gaze away, he feels as if he were fading. He cannot let the role he plays, that of the president, to become boring. He needs to steal every scene. So, he does something to ramp up the drama, like a soap opera with falling ratings, just to keep the public glued to the screen. Accusing former President Obama of tapping his telephone is a soap-opera move.

We've gone from the presidency of Barack "no drama" Obama to a reality television performance of the presidency by a man who thrives by inventing drama. Voters wanted change, and that's the change they got.

I began thinking about the reasons for Trump's phone tapping tweets in terms of how they could possibly benefit him in the long term, but I was thinking about it in terms of the goals of a normal politician. Whatever happens because of those tweets may well ruin Trump's presidency, but he will be the center of attention all through the drama.


Sunday, February 26, 2017

Quick! A shirt and a sandwich! Melons and a hat!

by John MacBeath Watkins

Let's compare a couple of charts, shall we?

(chart from Wikipedia)


It's easy to see why bookstores are having a hard time. Not only were those charts easy to find, the other stuff you can get quickly is amazing.  I've just watched one of my favorite films, and one of my favorite lines in it is "Cousin, you're back at last! But what a state!  Quick! A shirt and a sandwich!  Melons and a hat! Stockings!"

As an experiment, I plugged the title of this post into a search engine, and lo and behold, up comes the entire screenplay of The King of Hearts. Before the internet I'd have had to search a fairly large library to find the screenplay, and I might have found it untranslated, in the original three languages. I suppose that has something to do with the spellchecks that insist I've not written internet right unless I capitalize it, like it was a proper name, or I was writing about God. It's as if you'd be taking technology's name in vain.


But why is that such a good line? The film is about the insanity of war, as revealed by the reaction of the inmates of an insane asylum to it. That line has a hallucinogenic absurdity to it that takes us to a metaphorical war, the war on drugs, which increasing numbers of people are saying is over, and the drugs won.

One consequence of the drug war is that we have 25% of the world's prison population, and only 5% of the world's total population. This is tremendously expensive. And it has a great deal to do with our drug laws and their enforcement.


It seems to have escaped the notice of most Americans that the easiest and cheapest way to cut the crime rate is to make more things legal. The political solution is to hire more police and lock more people up for longer periods of time, which might be an efficient way of dealing with the problem if our prisons were really good at getting people to stop committing crimes.


But in fact, it seems that the people who have the easiest time getting out of a life of crime are those who don't get caught, don't get a prison record that keeps them from getting a good job, don't learn what our prisons have to teach. The Stanford Prison Experiment showed back in 1971 how prisons only bring out the worst in people, regardless of which side of the bars they are on. We've responded to this knowledge by putting more and more people behind bars.


We now have guards' unions lobbying for longer prison sentences because that's how they get job security. We have private prison companies that benefit from these policies as well. We have police corrupted by drug money in a most peculiar way -- property forfeiture laws have made arrests so lucrative for police department budgets that in some cases, such as the notorious Tenaha, Texas, scandal, police have been allegedly using the laws to take property from innocent people.


Of course, there will always be corrupt police. And biased judges, bad restaurants, etc. The problem is that the drug war puts so much power in their hands and so much wealth within reach. Tenaha might have been known for a speed trap in a more innocent age, but the drug war has increased their power, and in economic terms, the rent they can gain by abusing it.


With budgets straining, perhaps we can take another look at the money we're spending on this and come up with a more sensible arrangement. Take another look at the charts above. The crime rate started to decline when the baby boomers passed peak age for criminal activity, spiked again as crack flowed into neighborhoods and gangs fought violent turf wars, and has been declining since. If the crime rate were falling because incarceration was increasing, we would expect to seen a steady decline as the incarceration rate increased. Now, we'd like to think the incarceration rate has something to do with the decline

Friday, February 24, 2017

The $600 sailboat

by John MacBeath Watkins

My friend Pete Chopras came up with the idea of having a class of boats that would be limited by a box rule and a limit of $600 for materials. I've been thinking about building one for more than a year, but between moving the business and my residence, and not having a space to build in, I've yet to get past the design phase.

Two boats that strictly meet the rules have been built, and are on the dinghy dock at Leshi, on Lake Washington. A third got built at the Port Townsend Wooden Boat Festival, but it uses items (such as the mast and rudder) left over from other boats the builder, Richard Woods, has owned and does not strictly comply with the $600 limit. Pete built the hull of his own boat, but life has interfered with completing it.

I began thinking about this in terms of a boat that would be fast, challenging to sail, and forgiving if you screwed up.

But I've run into a problem. If I'm going to spend the time and effort to build the boat, it needs to be a pleasant daysailer. The requirements for such a boat are at odds with going as fast as possible.

The basic philosophy with racing dinghies is that the boat will be fastest when sailed flat, therefore the hull needs almost no initial stability. In fact, a stable hull will have more drag than an unstable hull, so stability is a negative. The formula for stability is the weight of the crew and their distance from the center line of the hull. Richard's boat, built to his Zest design, is exactly that sort of boat, narrow and with hiking wings, and will no doubt be the fastest of those built for the class, and not just because he's a better racing sailor than the rest of us..

But I want a boat with enough stability that I don't have to work my butt off when daysailing.

So, I've decided that if I build for this class, I'll build a boat that is pleasant to own and sail, and not worry too much about speed.

This is what I came up with:




And the lines drawings:



The box rule is 14 ft. by 5 ft. The boat is supposed to be able to carry as much as 500 lb. of crew and cargo.

I do have a little problem with this. 500 lb. indicates a crew of three, and that's a bit intimate for a 14 ft. boat. I could build a 15.5 ft. boat with the same scarfed pieces of plywood, waste less ply and have more room for crew. But if I build it that big, it won't have a class to race in.

Two of the boats are built with Ironply, a product that is a high-quality underlayment with the right glue to tolerate marine use. I might use that, though if I can get a good enough deal on marine plywood, I'd go with that.

The next problem is getting cheap enough sails. Practice sails for a Club 420 are available fairly cheap, and if I use a centerboard, I can move the center of lateral resistance aft by pulling the board part way up, in case I want to daysail with just the main up. Again, a daggerboard would be faster, with an aperture that would provide less induced drag, but I want a practical daysailer.

The boat is a smaller version of something I drew up for illustrative purposes for my sister, who was working on saving the sail training program for Vashon's Quartermaster Yacht Club, so I've been thinking of it as the Vashon skiff.

It's designed for stitch and glue construction, and the panels develop very little stress, so it should go together fairly easily. The decks are designed so that they all develop as well. The double hull construction will make the boat heavier than a single hull with buoyancy bags, but should I capsize in cold water, I doubt very much I'll feel like spending a lot of time bailing.

With a crew of two, the boat should float with a waterline beam of 4 feet, which I believe is a little more than the waterline beam of a 420. So, the boat will probably be a little slower than a 420, at least in light air, but not much slower. The sharp entry and V'ed forward sections should make it a dry boat, though flatter sections might get it planing sooner.


For the rules for this class, go to post 967 here: http://www.boatdesign.net/forums/sailboats/new-low-cost-hardware-store-racing-class-input-proposed-rules-42343-65.html

Tuesday, February 14, 2017

The Siberian Candidate is now the Siberian President

by John MacBeath Watkins

I confess, I have been remiss. While our new president has been showing us why we can't have nice things, I have been silent.

Words have failed me. I have a BA and an MA in political science, and none of what's been happening in Washington has made sense to me.

When I first heard of the title of Matt Taibbi's new book, Insane Clown President, I thought that surely, this goes too far.

Not even close. The resignation of Gen. Michael Flynn as National Security Adviser marks the third person to leave President Trump's inner circle because of ties to Russia. Paul Manafort, who joined the Trump campaign back in March of last year, left the campaign in late August because of his ties to Russia (such as arranging for fake anti-NATO rallies in Ukraine to help Russia keep the region as a client.)

Carter Page left the Trump camp in December when it came out that his links to Russia were under investigation by the CIA.

Flynn's resignation letter admits he lied to Vice President Pence. It does not say that he lied to Donald Trump. And Trump didn't fire him Jan. 26, when he learned that Flynn had spoken to the Russian Ambassador to the United States and lied to Pence about it.

This all seems a little curious. Why wait 2 1/2 weeks to fire the man? Why not fire him before the whole thing blew up in public? Could it be that Trump was aware of the call all along, could he even have directed Flynn to tell the Russians that the sanctions President Obama had put in place to penalize the Russians for attempting to sway the American election would be walked back once Trump was president?

It seems likely that Trump and his inner circle knew about the Russian intervention all along, and there are even allegations that there was a quid pro quo for the Russians for doing this.

Remember this?

The dossier's claim about a Ukraine-WikiLeaks quid pro quo alleges that Trump would refrain from speaking forcefully, if at all, during the 2016 presidential campaign about Russia's 2014 incursion into eastern Ukraine. In return, Russia would provide WikiLeaks the documents it stole from the Democratic National Committee.

It seems increasingly likely that the Trump camp has been working with the Russians for quite a long time. I, of course, don't know for certain why this is. My guess would be that there's a carrot and a stick involved. There's got to be a reason Trump has resisted all attempts to get him to release his taxes, and one possible reason would be that it might show how much he is financially entangled with Russia. And in Russia, if you have money to invest, you have ties to Vladimir Putin.

It seems quite likely, given President Trump's known proclivities, that the have some sort of dirt on him. It could be that it's the  infamous claims in the "unverified dossier" that Trump hired young women to pee on each other on a bed he knew President Obama and his wife had slept on. Or that could be misdirection, and they have something else on him. Or, it could be that the money link is enough.

Late in the presidential campaign, there were people calling Donald Trump "the Siberian candidate." I don't think we know the extent of his links to Russia or his motivations. But this seems like the only issue currently on the table that could bring his presidency to an early end.


Sunday, January 22, 2017

Escapist fiction

by Jamie Lutton

As an adult, my idea of escapist reading is different from when I was a teen.

As a teen, for a good solid 10 years, I mostly read SF novels, or Analog (sf) magazine, every day.   As a speed reader, I would sometimes plow through a book or two a day, rereading favorites.  I read my brothers and father's collections, obsessively rereading favorites, dodging home work, or even going outside.

When I was about 20 or so, I discovered history and science books, and overnight quit reading SF and fantasy, except for a few favorites. I turned my back on the field, and did not pick up new authors much.

When I began to assemble books I wanted to write about, I hesitated to tackle my childhood favorites, feeling like I was 'slumming'. But then I remembered how these books taught me so much about the world, and some history, as well as political philosophies to admire, then argue with.

I previously wrote about the editor of Analog, John W. Campbell, his strengths and prejudices here.

I got interested in why the style of story he favored - with humans triumphing, and stereotyped aliens overall.  It came to me a few days ago.

A great many of these stories were 'fairy tales' or fables retelling the struggles of the 1930's and fighting both the Nazis and the Japanese in World War ll.

The Greatest Generation survived the worst and longest depression the country had seen in 75 years (you have to go back to the era of Andrew Jackson to find as bad a depression) while watching Fascism grow in both Europe and Asia, marching across the landscape.

We watched, on the sidelines, waited till we were attacked, then defeated BOTH armies, with the help of allies of course, in 5 short years.

The stuff of science fiction, if it was not true.

We should have acted earlier, as we watched one country after another fall in Europe,and watched Japan seize thousands of square miles in the Pacific.

We should have rescued the Jews, or tried to slow down the death camps.  We should have entered the war earlier.

But when we did enter the war, we kicked ass.

These amazing events charged the minds of the SF writers for the next 25 years. In one SF novel after another, this is the fable that is told.

In The High Crusade by Poul Anderson, written in the mid 1950's,  a small group of knights in 1346 overcome the crew of a hostile UFO bent on invading Earth, kill everyone on board except the navigator - and take off with everyone in the village on an adventure in deep space (the end of the book has our distant descendants coming across their space empire).

In Pandora's Planet, written in 1973,  other hapless humanoid aliens try to conquer Earth, and in a series of maneuvers, have their ass handed to them by the Earth armies.  The warfare, described by the aliens, reads suspiciously like what Germans, weary from fighting on the Russian front, facing fresh faced young Americans on the battle field (in 1943 or so), might say in their memos to headquarters.

And the target audience would have ''gotten'' it, and lapped it up.

In Wasp, by Eric Frank Russel, written in the mid 1950's one man defeats an entire planet by using Guerrilla  warfare. The book is innocently anarchistic long before Earth First was dreamed of =- the hero blows up generals, ships at sea, and plasters the planet with flyers for a fictional underground.   The author had worked with the French Resistance, and had put things in this novel they had never gotten around to trying on the Germans during the war. And the aliens are transparently based on Japanese and German culture.

One novel like this is a bit less dated. The Demon Breed by James H Schmitz, written in 1968. The hero is a woman, a trained biologist, and there are genetically altered 10 foot long talking otters in the book. But the aliens again are evil,defeated by the ingenuity of the heroine and her 200 year old Biology professor she is rescues from their  clutches.

And defeated in a new way:The fighting was eerily like the fighting techniques of the North Vietnamese. The setting is even in a dense jungle, albeit on a floating island on a water planet. But the author was seeing society changing, and integrated that in the book.  Some very well known authors a generation later, like David Brin, copied the idea of genetically ''improved' animals, with his heroes that are sentient dolphins and chimpanzees.

But still you see an obligatory happy ending, humanity triumphant.

Part of this was that the editor of Analog wanted happy endings and humanity coming on top in the stories he accepted for the magazine.  But it was also the tenor of the times
for many years.

Over and over, people wanted to hear about World War ll again in their fiction, disguised in the setting and the details, but the general idea.

Even some that are strange and odd - one story by Poul Anderson, again, written in the early 1950's, has as a deux ex machina all IQs of mammals (he did not consider the birds, a shortcoming of the book) go up and up, until humans have an average IQ of about 400 and chimpanzees, elephants etc begin to revolt and want rights.  Of course, they go to the stars, of course they are ahead of other races they find there.

There are some dark moments in the book - people who lose their minds due to the IQ growth - but, again, humanity prevails, prospers, overcomes, goes on to a glorious
future.

All like the happiness we had as Americans, at defeating the Nazis then a few months later, the Japanese.  

I still like these stories, as I read them when I was young, very depressed, and frightened. I did not see a happy ending for myself, and I was in a hostile, unpredictable environment
that was painful and unpleasant.

In a way the fables of humanity facing great peril, fighting (one way or another) and winning was quite comforting to me, as it contrasted to my utter helplessness of my position in life.

When I read The Demon Breed over and over, I could dream of defeating my enemies by using stealth and having giant killer otters to help me. Or reading Wasp and with cheery lawbreaking, bombing, and stealth, bringing down an entire planet. Lonely work, yes. But I know loneliness, and could grasp THAT and run with it in my dreams.  Or reading about a bumbling alien army not able to conquer Earth, due to our trickiness.

Or being one of the medieval knights taking over a starship, and with my family and friends heading for the stars for deep space.

Even as an adult, these fables are quite comforting. I have more sophisticated taste now. 

But these books, and perhaps 40 or 50 others like them, when they come into my bookstore, I feature them on my ''recommend'' shelf.

My tastes now run to paleontology, politics, poetry, history of disease, history of technology, etc etc, and people who know this blink when they see these fables pushed by me.

These stories were a lifeline to me, when all else was dark, with the basic fable that humanity -- and that was me, personally -- would prevail.

I suppose all teens seek this, as the world is a frightening place even for happy teens with sane parents. That is why these stories have a popularity even now. Though teens now seek more ambivalent novels. they did not grow up in the shadow of World War ll, they grew up in the shadow of Reaganomics, endless wars abroad, and growing fears for the future. 

So these 'happy' and somewhat simple stories do not appeal any more. The Greatest Generation is mostly dead, and their children are getting old, I know I am.

But a few, a happy few, of these SF fables are still fun to read.

One thing I noticed about the elephant in the room -- the fantasy epic by Tolkien, published in this era, in the early 1950's, The Lord of the Rings.

Tolkien worked on this epic starting in 1938, when he sat writing the thing on the back of old student's papers. He wrote the core of the book from that year to 1944 or so, the rest was revisions and more revisions, taking 14 years or so.  The book started out being a lighthearted, more or less, sequel to The Hobbit, but as he said in a letter to his son ''the Black Riders just appeared on the page."

There are a lot of theories from academics about the how and why of these books, but one point that has been overlooked is that he was writing the core of the thing when he (justifiably so) expected the Germans to be coming over the hill any week.

France had fallen, and Germany was openly making plans to invade England.  In Peter Fleming's book Operation Sea Lion, it was a close thing; this almost happened. Only the Germans' inability to win the air war and distraction and costs of the Eastern Front, fighting the Russians, kept them from invading England.

Tolkien had lost 4 of his closest friends in World War l, and his beloved son Christopher was off at war when he was writing. So different a time than when he wrote The Hobbit, 10 years or so earlier. That had started out as stories he told his son when he was young.

The genius of The Lord of the Rings is great, it is a massive book, but the dark inspiration had to have come from this professor of languages fearing for the destruction of England, and all he loved. 

All SF - and fantasy - is about the time it is written.

No wonder some of the post World War ll novels are forgotten. Add to this the sexism of the era -- few or no women characters of any note -- and other clunkers, it is hard to read the old stuff, unless one is willing to go into a mental 'time machine' and try to see it with the 
eyes of the year it was written.

I try to do this as a bookseller, and also when I go back and read them again, to see if I can recommend them, still.

Another elephant in the room is Robert Heinlein.  He wrote such bad books at the end of his life that his good books can be overlooked. An entire essay could be spent talking about his books, as they are imaginative and varied, though they stick to the theme of Humanity  Prevailing. 

In his best book, he had the audacity to make America the villain, in The Moon is a Harsh Mistress , as well as making a sentient computer one of the heroes, an early stab at this, written 4 years before 2001 a Space Odyssey came out as a movie.

In another good  book of his, Have Spacesuit, Will Travel, a juvenile, a teen saves the Earth by bringing up the glories of ancient Greece to a skeptical group of hostile aliens bent on destroying Earth for the good of the neighborhood.

When I read these as a teen, I noticed the author was trying to make me think, as well as entertain me.  That is why his 25 or so books, even the bad later ones are still sought after. 
I noticed the aside about ancient Greece, and in my teens began to read ancient history, and can still hold up the passage and say 'HERE. Here is where my love of history really started' to anyone who will listen.

Saturday, January 14, 2017

A beginning: Books I've loved

by Jamie Lutton

I have been struggling now for several years to get down on paper some observations on books, book reading, and book selling.

I think I have an interesting perspective on this. I had one of the most awful childhoods meshed with getting to be around very bright, well read parents who shared their love of books. School was a misery, as I had an undiagnosed mental troubles combined with dealing with an unstable, angry alcoholic mother.

Total face blindness combined with severe manic depression meant I slunk though the halls at school dodging spit, screams of mockery and physical attacks, while at home had to watch my mother drink heavily every night after work.

The glimpses of pleasure I got started early, when I began to read anything I could get my hands on to escape my surroundings.

I discovered I was a speed reader pretty early, while still in elementary school, and that I had a taste for non fiction. Novels tend to involve people, men women and children, overcoming obstacles and 'growing.' I had had enough of that in my own life.

I developed a love of poetry, at least I am fond of the poets my mother used to read to me when she was only half in the bag - Cavafy's Waiting for the Barbarians, Frost's Death of the Hired Man, Robert Browning, Edna St. Vincent Millary, etc. She would tilt her chair back on two legs, at the dining table, smoke a cigarette, and read aloud from some collection or another lying around, in the smoke-filled, rather disorderly house. A particular favorite of hers was The Love Song of J. Alfred Prufrock by T.S. Eliot, which she would try to recite without the book, especially the few lines, when she was really three sheets to the wind.

Both my parents smoked like chimneys, and indoors, a habit of a bygone era of the Greatest Generation. The walls were tinted yellow from the constant haze of cigarettes and Panatella cigars that dad smoked.

But mostly, from an early age, I read 'geeky' nonfiction. I had an appetite for science fiction and fantasy, as good escapes from my grim situation, but I was drawn to adult books on psychology, like How Children Fail, by John Holt, which I ate up in fourth grade when the school I was in was in the process of expelling me for ''fighting'' because I was defending myself from the bullies who hit me. Loved the book, and it still speaks to me.

I loved nonfiction - massive adult books about kangaroos, volcanoes, plagues, earthquakes, cats, battles. Not so much biographies, as their subjects often had painful lives and I was trying to escape that kind of pain.

Through my school years, I was reading two books a day, while phoning in my school work, handing in grubby sheets with incredibly poor handwriting on them.

I mostly was just trying to exist without being harassed, by either my schoolmates my siblings -- the two closest to me in age and I did not get along at all, in those years --
and to tune out my mother's drunken ravings.

Now and then, she would read to me. When I was really little, she read to me all the time, The Little Engine that Could, and like that. She was a children's librarian by day, and a damn good one -- she would seek out hard-to-get books to put into the library system she worked in, and was a fierce champion of banned books. She was a very smart, well read woman with a wicked sense of humor - -I would miss her more now that she has been dead nearly 10 years, if she had not also been a raging, angry, accusatory, paranoid drunk.

She got drunk most days, and was not fun to listen to, not fun to be around. I did seize on the times when she was still sober, and would talk about authors she liked. Many of them are my favorites too, such as Dorothy Sayers, Georgette Heyer, and Rex Stout, but those times were rare, as most of the time she was trying to get as drunk as possible and stay as drunk as possible every night.

I think that is why books are so important to me. If I had not been a bookworm at an early age, I would have killed her. I had taped up on my wall for years a clipping about an 18 year old girl who did not get into Harvard, though she had been admitted with a full scholarship. She had killed her own drunken, abusive mother when she was 14, and was locked up for it till she was 18. Eventually she got in to Tufts, hurrah.

She was my hero, privately, gleefully, for what she had done. Later on, I forgave my mother, as she lost her eyesight as her smoking (and drinking) made her macular degeneration worse.

She suffered so by not having books to escape into. She listened to tapes and listened to a lot of NPR. I forgave her, and understood her; I think she had the same brain trouble I did, and medicated herself by drinking.

So, books are important to me -- and not novels, though I have read and liked a fair number, but nonfiction. Some nonfiction books I have read over and over, and those are the ones I want to write about. Also those that I may only have read three times, but I thought were stellar.

And as a bookseller, I have noticed that some authors and subjects are difficult to read without some explanation, some "helps''. Either they address problems that are not clear to us, context we don't understand easily -- like Thomas Paine, or they wrote in a bewilderingly different era, like Dante's or Elizabeth Barrett Browning's time.

Next February I will have been selling books with a licence for 30 years (before that, I was a book scout, buying books and selling them to bookstores.) I have handled books for resale 42 years. In that time, I have come across nonfiction books that deserve attention, on many many different subject --Statistics, drug crazes, to poets, stock market crashes, human and animal evolution, etc.

Let me share my knowledge with you. I have read a lot of second rate books, badly written or boring books, and I think I can offer up some of the best of what I found.

This is very idiosyncratic list. I am fond of plagues, disasters, and diseases, but some are quiet
accounts of love, knowledge, dreams and inspiration.

Monday, December 26, 2016

More on Republican economics and trade deficits, corporate raiders and all

by John MacBeath Watkins

I've been giving more thought to the curious fact that we had very little experience with trade deficits before voodoo economics reared its head in the 1980s.

What changed? Well, several things. In fact, our whole attitude to economics seemed to change.

There was a major shift in the tax load. Ronald Reagan famously lowered the top marginal tax rate from 70% to 28%. This encouraged the accumulation of wealth by the highest earners. But tax receipts only went from 18.2% of GDP to 18.1% of GDP. Did that mean that voodoo economics worked?

No, just funnin' ya. It means that while high earners got a lower top marginal rate, others paid more tax, and some was shifted from one pocket to another. Payroll taxes, for example, have been rising for a long time, and that's part of what he did, but the government kept getting just about as much of its income from individual income taxes as before.

Source: Wikipedia

It's just that different people were paying the tax. In addition, the long-term trend for lowering corporate taxes continued. In about 1970, the government started collecting more tax from payrolls than from corporate income tax. In 1952, tax receipts from the corporate income tax amounted to 33% of revenue, in 1982 it was closer to 7%, and it's settled to something less than 10% in most years.

Now, the Tax Foundation argues that high corporate taxes have caused business owners to set up "pass-through" corporations whose only function is to pass income through to the owners without paying corporate income tax. This is because Reagan lowered individual taxes more than corporate taxes.

The Tax Reform Act of 1986 reduced the corporate tax rate, but reduced the individual tax rate further, and raised taxes on corporations in other ways. That marked the peak of U.S. C corporations, at 2.6 million in 1986. As of 2011 (most recent data), there are now 1 million fewer corporations, at 1.6 million. In contrast, S corporations grew from about 800 thousand in 1986 to 4.2 million in 2011, and partnerships grew from 1.7 million to 3.3 million.

It would seem that this encouraged the use of a tax loophole to dodge the higher corporate income tax. The Tax Foundation, based on this information, argues rather improbably that this is wrong, that the reduction in corporate tax receipts is owing to a shrinkage of the corporate sector -- even though their own figures show an explosion of (pass-through) S-corporations. If, in our innocence, we assume that S corporations are corporations, this notion that the corporate sector has shrunk cannot possibly be true.

And since individual tax revenues have pretty much held steady, that means that the big change has been shifting the tax burden from corporations to payrolls. Payroll taxes are paid half by employers and half by the employee, and there is some controversy about whether total compensation to the employee should include the employer's share. But the point of payroll taxes is that both sides of the tax are really costs to the employer, whether the employee regards them as pay or not.

In essence, what we've come to call Reaganomics involves making it more expensive to hire employees and letting corporations keep more money (or pass it through to their owners.)

At the same time, healthcare costs were going through the roof, and the only practical way for most people to have health insurance was to have it through the employer. So again, the cost of employing Americans was going up.

The Affordable Care Act, AKA Obamacare, was in part an attempt to "bend the curve" of healthcare cost increases, which it seems to have succeeded in doing, and in part an effort to decouple health insurance from employment.

Both are things that need to happen if hiring Americans to make things and export them is to continue to  be a viable enterprise.

Now, increases in payroll taxes are a long-term trend that didn't start under Reagan, and the decline in corporate tax revenues started long before he came into office as well. What was new?

For one, the claim that tax cuts didn't have to be paid for, that we could cut taxes on the rich and it would stimulate the economy so much that tax revenues wouldn't fall. This was obviously wrong by the mid-1980s, and should have been obvious it was wrong even before it was tried, but the same old snake oil comes on the market with every Republican administration.

The old Keynesian consensus was that you needed to stimulate the economy in downturns and reduce the debt-GDP ratio in good times. Reagan, and later the Cheney administration for which George H.W. Bush's son was a figurehead, changed that calculation. The economy needed to run large deficits during Republican administrations, and cut spending regardless of economic conditions during Democratic administrations.

The result can only be workable as economic policy if by coincidence.

One problem with these changes is that although the numbers sometimes obscure this fact, economics is a science of values. When you increase tax on work and reduce tax on ownership, you are sending a message that you wish to discourage work and valorize ownership. Pretty much everything we've done with economic management since the 1970s, the financialization of everything and the way the change in the basic mission of corporations allowed management to break implicit contracts and go to war against their employees.

As Larry Summers and Andrei Schleiferwere pointed out in their 1988 paper, Breach of Trust in Hostile Takeovers, the financialization of the economy and the breakdown of companies were linked.

When takeover artists could raise huge sums in junk bonds to do a hostile takeover of a corporation, their plan was not actually to make the company more productive. Summers and Schleiferwere put it, "The industrial diversity of many raiders' holdings suggests that their particular skill is value redistribution rather than value creation."

The reason that companies exist, rather than having individuals doing all the tasks of the company on a contract basis is that the transaction costs of contracting everything would be enormous.(see R.H. Coase, The Nature of the Firm, Economica, Nov. 1937.) Value creation requires implicit contracts which enable large groups of people to work for a common goal.

But the credo of the corporate raider was to make war on their own employees, get them to take less pay, and pass the larger profits on to the management and the shareholders. Companies that had for years worked for a partnership between workers and management found they were under financial pressure to do the same, or be a takeover target.

Starting in the 1970s, public corporations stopped being about what Coase had said firms exist for, working together to create value for customers, and became a game of takeaway.

And that's about the point where America started running large trade deficits. As I've previously pointed out, there were some pretty substantial other factors, like the oil shock of 1973 and Chinese financial sterilization in the 1990s and early 2000s. Still, it does seem a bit of a coincidence that we stopped exporting as much as we imported about the time that public corporations stopped being about creating value and started being about redistributing it upward to the managers and shareholders. And that this all happened while the tax burden increasingly discouraged hiring and encouraged speculation.

But then, I"m an amateur. What do I know?

Thursday, December 22, 2016

Trumponomics, trade, and stateless money

by John MacBeath Watkins

We're hearing a lot about the trade deficit lately, and Donald Trump got elected in part based on his claim that he could turn this around.

How will he do that? Well, if the recent Carrier deal is an example, by bribing companies with tax dollars and browbeating those businesses. He's also claimed he would put a 35% import duty on goods produced by factories relocated outside the United States (but not, apparently, on the foreign companies they compete with.)

Import substitution, that is, raising duties and attempting to have more things built in the homeland, did not work very well for Argentina, and is unlikely to work well for the United States. Furthermore, it appears he intends to give big tax breaks to the rich. I believe there are ties between inequality and trade, at least in the American economy.

Now, here's a chart from The Motley Fool showing the history of the U.S. trade deficit.


When Europe started rebuilding after World War II, we had massive trade surplus. How could other countries afford to pay for that? Well, we were shipping them plenty of capital, though the Marshall Plan and private investment. Then, we went through an extended period when trade was roughly balanced, from about 1950 to the mid-1970s, when the oil shocks changed everything.

It was after this that the great decline came, and not just in the trade deficit. Current accounts went into deficit as well.

Essentially, we've been borrowing money and spending it on foreign goods. In part, this is because of deliberate sterilization by China, that is, buying U.S. debt so that the Chinese trade surplus would not cause its currency to appreciate, which would tend to correct for the imbalance. China started doing this in the 1990s. In 2005, they began letting their currency appreciate, but they don't seem to have slowed up on building their dollar reserves until around the end of 2013.


That's only part of how consumption has been paid for. Other capital flows would be earnings parked overseas for tax reasons, foreign money parked in America by nervous foreigners looking for safety, inflows of private investment, money spent by tourists here and abroad, etc. The biggest factor in the current account is the trade surplus or deficit. All in all, the current account shows whether a country's net foreign assets are increasing or decreasing, and ours have been decreasing since about 1982, with upticks in the late 1980s as the price of oil declined and after the Chinese allowed their currency to appreciate after 2005. Aside from those, rising consumption is being paid for with borrowed money. And the Chinese example of sterilization shows how that's possible.

Now, the question remains, what happened in 1982? We know what happened later in the decade, the Japanese Yen increased in value and the terms of trade no longer allowed our (then) largest trading partner to keep building huge trade surpluses, and lower oil prices reduced the trade deficit.. But aside from that reprieve, trade deficits have tended to grow.

I'm inclined to suspect that this has something to do with changes in the structure of our economy. Changes in banking allowed raiders to finance hostile takeovers of established companies, the top tax rate went from 70% to 28%, the country became a more hostile place for unions, and rules were changed to allow stock buy-backs to become common. One result of all this was to move income from the lower and middle classes and up to the top earners. A side effect of this was to make capital more mobile.

Middle class people tend to keep their money in savings and investments that they can quickly get at is circumstances require. If they start a business, it's likely to be a local business, a hardware store, a hair salon, something that keeps the money local. But there again, they run into rules changes. For example, when Reagan came into office, the Justice Department changed the way it enforced anti-trust rules. Anti-competitive practices like predatory pricing used to be treated as illegal. Now, in most cases, the Justice Department is only interested in collusion to raise prices. This has tended to favor the Walmarts of the world over the mom and pop stores.

Those at the top level of income are more likely to invest internationally, and as we saw when the Panama Papers became public, they may move money abroad to avoid taxes. Of course, they might have done that before the 1980s, but when wealth is very concentrated, as it is now, more of it belongs to people who see large benefits in tax havens. And even that may be dwarfed by the amount of stateless money corporations are keeping abroad to reduce their taxes.

I'm not sure there is anything like a 1:1 correspondence of inequality and stateless money, or of stateless money and trade deficits, but I think it's time to examine the question. Something has gone haywire, and the timing suggests to me that changing the rules of the game so that more of the money went to those at the top played a key role.

America used to be the most active country for small and medium-sized business startups. That pattern has changed, with a steady decline since the 1970s.

http://www.gallup.com/businessjournal/180431/american-entrepreneurship-dead-alive.aspx

As someone who has started a business, I can tell you, your own savings are the most reliable source of funds, and many startups are done with family money. As Harry Truman observed, a bank will loan you money if you can prove you don't need it. Inequality makes it harder for small businesses to get started, because it reduces the amount of savings available to the middle class.

And if you want more jobs to stay in America and more companies fit to export, you aren't going to get there by bullying or bribing existing large companies. A more equal distribution of income will allow people to buy things without borrowing the money, and more people to start up businesses to serve that demand. Cutting taxes on the rich will not serve this purpose.