Google analytics

Wednesday, January 22, 2014

A plan to reduce inequity: Working versus owning

by John MacBeath Watkins

Everyone talks about inequity, but no one does anything about it. I propose to examine how we got where we are, and what we should do to reverse the situation. It seems to me that on both left and right, there is a longing for a time when the economy worked better for the average Joe, and I mean to find out how we lost it and how to get it back.

I am now well stricken in years. My legs are grey. My ears are gnarled. My eyes are old and bent. I remember the time conservatives long for, when a man could call his home his own, his wife would be waiting with a martini when he got home, everyone smoked, even your doctor, and if you worked hard and remembered to be white and male, the world was your oyster or some similar mollusk.

One feature of this world was that the middle class had a decent income. A one-income family could afford to own a house, run a couple of cars and even send the kids to college.

Things have changed. Median income for male workers has been declining since 1973, while women are more likely to be working and are making better money.

(from here:

For a while, two-income households managed to keep the median household income rising until 2000. Now, median household income has fallen to the level of about 1979.

(from here:  

As you can see from this chart, most of the increases in income have gone to those at the higher end of the income scale, while the poor haven't gained much since the mid-1980s, and the median have gained some, then lost some. As society as a whole has become more prosperous, the gains have mostly gone to those at the higher end of the scale. How did that happen?

Part of the story is taxes. During World War II, congress imposed a 94% top tax bracket. Few people paid it, but it was a way of saying, we're all making sacrifices, we're all in this together. Now, say what you will about Arthur Laffer, the Laffer Curve, which he did not invent (that honor belongs to an Arab thinker about 1,000 years ago) if you have high enough taxes, it does apply. Recent research indicates it applies to rates above 70%, which means that Jack Kennedy took care of that problem in the 1964.

Attempts to apply the Laffer Curve after the problem was already solved did nothing but help increase the share of national income the richest people got to keep. It did not stimulate the economy so much that tax revenues actually increased, as Laffer promised. It just resulted in more debt.
from here.

During the Reagan Administration, we lowered the top marginal tax rate from 70% to, eventually, 28%. But some taxes were increased. When Reagan entered office, payroll taxes (Social Security and Medicare) were 9.9%. By the time George H. W. Bush left office, they were 12.4%.

Now, something that occasionally makes the rounds is the idea of a flat tax, as if calculating our tax rate were particularly difficult after we'd worked out all our deductions. Usually, the idea is to not tax incomes below a certain level, so that it's fairer for the poor. The payroll tax is a flat tax turned upside down: It applies to the first dollar you make, but any amount you make above the base wage ($117,000 for 2014) isn't taxed.

Since payroll taxes are part of the unified budget, this amounted to cutting the top tax rate while increasing the regressive inverted flat tax of the payroll tax. Meanwhile, the capital gains tax, which peaked above 40% during the Ford Administration, is now 15%, the lowest it has been since shortly after Herbert Hoover left office.

People who make a living by owning things, which used to be called the rentier class, tend to be the ones paying the capital gains tax rather than the payroll tax or ordinary income tax. The system can also be manipulated to turning what looks like ordinary income into "capital gains" for tax purposes. Greg Mankiw provides an example of that in what I suppose was intended to be a defense of capital gains taxation of, for example, hedge fund managers.

Here are some of Mankiw's examples:
• Carl is a real estate investor and a carpenter. He buys a dilapidated house for $800,000. After spending his weekends fixing it up, he sells it a couple of years later for $1 million. Once again, the profit is $200,000
• Dan is a real estate investor and a carpenter, but he is short of capital. He approaches his friend, Ms. Moneybags, and they become partners. Together, they buy a dilapidated house for $800,000 and sell it later for $1 million. She puts up the money, and he spends his weekends fixing up the house. They divide the $200,000 profit equally.
• Earl is a carpenter. Ms. Moneybags buys a dilapidated house for $800,000 and hires Earl to fix it up. After paying Earl $100,000 for his services, Ms. Moneybags sells the home for $1 million, for a profit of $100,000....
This brings us to Dan and his partnership with Ms. Moneybags. The tax law treats this partnership as exactly equivalent to Carl’s situation. In this case, however, the $200,000 capital gain is divided into halves: some of it goes to Ms. Moneybags, who provided the cash, and some goes to Dan, who provided the sweat equity. Once again, nothing is treated as ordinary income.
 Now, here's a question. If it's hard to say which tax applies, why are we charging different rates? It appears we have decided to reward owning over working, and tax dodges designed to make it look like we're owning over admitting that we're working.

In fact, we're so sure owning is better than working, we have a top marginal rate of 39.6% on earned income, and a top capital gains tax rate of 15%. We are so in love with the virtues of owning, we reward it by charging a lower tax rate for it, and charge 2.64 times as much tax for those misguided saps who work for a living. Add in the payroll taxes, it's more like 3 times the tax rate if you're working instead of owning.

Well, what makes owning better than working? The oft-repeated theory is that if we encourage investment, the economy will be better and we'll all be better off. Another version of the argument is that we should use consumption taxes to encourage savings, because saving is better than consuming. This is an odd argument, because encouraging saving is also encouraging borrowing. In national income accounting, savings has to equal investment -- government borrowing and private borrowing have to equal private savings and foreign capital inflows. This isn't controversial, it's how the savings accounting identity is defined.

So when you complain about the financialization of the economy, remember, all that investment income is savings, and when you have a giant pool of money, it has to be loaned in order to make it grow. One reason that the pool of money in the 2000s was so giant was that China was operating its economy much the way America was in the 1920s. They were exporting mightily, and when you earn a lot of money this way, it usually means that lots of money comes into your country and that causes inflation, so that the low wages that  made you a super-competitive exporter increase, and you lose your advantage.

The people running China didn't want that to happen. So, they didn't keep the money in China. They "sterilized" their export income by buying securities in countries they wanted to export to. America and France did something similar in the 1920s, and it ultimately undermined international trade and contributed to the financial collapse that led to the Depression. The problem is, these actions produce a giant pool of money -- excess savings -- chasing good investments in the country targeted for sterilization. And that produces financial bubbles.

A model that says savings and investment are better than working and consuming will tend to this sort of thing. And surely, the whole point of an economy is to produce things and consume them. So why have we valorized owning things over making and consuming them?

Well, one way of justifying this view is to say that if we encourage people to invest and realize capital gains instead or working for a living, we'll have a more prosperous society in the end, and a rising tide sinks raises all boats. A low capital gains tax will encourage this sort of prosperity, we're told.

Only there's no actual evidence this is so. Len Burman, a professor of economics at Syracuse University’s Maxwell School, has run the numbers on all the natural experiments we've had in this regard as the capital gains tax has gone up and down. Here's what he found:

  If low capital gains tax rates catalyzed economic growth, you’d expect to see a negative relationship–high gains rates, low growth, and vice versa–but there is no apparent relationship between the two time series. The correlation is 0.12, the wrong sign and not statistically different from zero. I’ve tried lags up to five years and also looking at moving averages of the tax rates and growth. There is never a statistically significant relationship.
Does this prove that capital gains taxes are unrelated to economic growth? Of course not. Many other things have changed at the same time as gains rates and many other factors affect economic growth. But the graph should dispel the silver bullet theory of capital gains taxes. Cutting capital gains taxes will not turbocharge the economy and raising them would not usher in a depression.
If low capital gains tax rates catalyzed economic growth, you’d expect to see a negative relationship–high gains rates, low growth, and vice versa–but there is no apparent relationship between the two time series.  The correlation is 0.12, the wrong sign and not statistically different from zero.  I’ve tried lags up to five years and also looking at moving averages of the tax rates and growth.  There is never a statistically significant relationship. - See more at:
 That's from here:

At a minimum, Leonard Burman has shown that raising or lowering the capital gains tax doesn't seem all that influential. So why penalize earning money as wages relative to making money on investments?

Well, it may have something to do with power. People who make the bulk of their money as capital gains tend to be wealthier and better connected. And they tend, more than wage earners do, to be U.S. senators.

About 1% of Americans have a net worth of $1 million or more. In the U.S. Senate, 66 of 100, or two-thirds, are millionaires. High net worth individuals, by definition, own a lot of stuff, so capital gains taxes are important to them. Both your senator and his or her biggest campaign donors and bundlers tend to care a lot about capital gains. So if you expect them to be treated no better than working for a living, you're starting in hard luck. The people writing the laws are rich, the people writing the checks to the people writing the laws are rich, and the rich get most of their income from capital gains.

We've had enough experience to know Burman is right, so the only possible explanation for the continued coddling of the rich is that the tax laws are written for and by them. The way to change that is to bring it front and center in our national conversation, so that they can stop lying about their reasons for treating their investments better than your wages.

If we're going to value work as much as owning, we need to do something about the upside-down flat tax on wages. We ought not to be charging any payroll taxes on people's earnings below the poverty line. We can make up for that by raising the base wage, and by taxing all income the same for social insurance purposes. If you are making less than $11,490 and you are a single person, why should you pay 12.4 percent tax, when the Koch brothers, when they sell off a $100 million block of stock, pay hardly any more tax on it (if their accountants haven't found a way to make sure they pay no tax at all.)

Now, suppose they paid $90 million for that stock, and their profit is $10 million. Should they pay less tax on that $10 million than a basketball player with a $10 million salary? I can't see why they should. They didn't work any harder, and even if they didn't make a dime on that stock, they'd still have $90 million.

And why should there be no payroll tax on earned income above $117,000 a year? Why not $500,000 a year? The higher the base wage, the lower the rate needs to be. We can make up for the payroll taxes lost by not taxing the poor by taxing the affluent a bit more. Reagan sold an increase in the tax rate on payrolls as needed to keep the Social Security Fund solvent, but raising the base wage would have worked as well. For that matter, when the Highway Trust Fund became insolvent, congress didn't increase taxes, they just topped it up from the general fund. Keep this in mind when you hear people hyperventilating about the Social Security trust fund.

In effect, he raised taxes on working families and lowered taxes on the rich, with the revenues from tax increase on workers making the lost revenue of his tax cuts on the rich look less like an invitation to bankrupting the country.

This represented a major transfer of wealth from people who make less than the maximum basis wage to those who make a whole lot of money. And since then, we've lowered taxes on the way the rich tend to make money -- capital gains -- while keeping that higher payroll tax in place on people working for wages.

George W. Bush pushed for what he called an "ownership society," in which, for example, we'd all own investments in a retirement account instead of having a guaranteed benefit through Social Security. But as we've seen, one man's savings is another man's debt, unless, like Smaug, you choose to sleep on a bed of gold. And by taking his wealth out of circulation (and by frying anyone who tried to work the land) Smaug made the world poorer.

The alternative to owning investments and building up debt is the "pay as you go society." That's how Social Security is designed, so that it works as a compact between the generations. People of working age are taking care of old people, knowing that the next generation will take care of them.

While savings and debt certainly have a place, no one has yet explained to me why a pyramid of savings and debt is better than paying your way, which makes our treatment of investing as contributing more to wealth than working all the more puzzling.

Wealth tax:

Redistributing earnings from the middle class and the poor to high earners is one way of increasing inequity. We might redress some of this with a tax on wealth.

Henry George, a 19th century political economist, advocated a "single tax," a tax on land value, which he argued would go some way to solving the problem of inequity.

George argued that the reason increasing poverty accompanied increasing wealth was that as population increased, land values increased, so that working men had to pay more for the privilege of working the land.

There are some problems with this idea. Study after study has shown that property valuations are essentially regressive. When properties sell, you can compare their valuation to their selling prices. High-value properties are consistently under valued by this standard, and low-value properties are typically over valued.

The only place something like this has been made to work was Hong Kong, where the colony leased the land from China and subleased it to businesses and homeowners. Leases went for market rates, and by all accounts, the system worked very well. Without those special circumstances, I doubt the single tax is really workable.

Other than property taxes, the wealth tax we have now is the estate tax, which has been under assault by certain politicians and their paymasters for years. In 2001, it applied to estates above $675,000 in value, and the top rate was 55%. Currently, it applies to estates of more than $5.25 million, and the top rate is 40%. This has had a predictable effect on the number of estates to which the estate tax applies:
(The chart is from here: )

As you can see, the number of estates affected by the tax went down dramatically during the Reagan and George W. Bush administrations, up during the George H.W. Bush and Clinton administrations. Reagan and Bush II both exploded the national debt, while Bush I and Clinton worked to reduce it.

We have, in effect, reduced taxes on high incomes, investment incomes, and large estates, while increasing taxes on low and ordinary incomes and on wages.

And we wonder why inequity increases.

A Plan

So, to start with, let's lower taxes on working and on low wages, by exempting wages below the poverty line from the payroll tax. We can make up for this by applying payroll taxes to higher incomes than we do now.

Let's stop privileging owning over working. Tax capital gains like earned income. Face it, creating giant pools of money leads to financial bubbles, and in a mature economy, to have investment opportunities, you need consumption. That means you need people working and paying as they go, not just saving and lending. We've got the balance wrong right now, and we need to move it back toward working.

As I write this, we're slowly coming out of a recession, which means we have too much unemployment because of a lack of aggregate demand in the economy. But there is such a thing as a "natural rate" of unemployment, defined as the rate at which lowering interest rates produces more inflation without producing more jobs. To a great extent, this means workers' skills don't match the remaining work that needs doing. We can reduce the natural rate of unemployment by increasing worker skills.

Unfortunately, we've been moving in the other direction, defunding schools and forcing people to go deeply into debt to acquire the skills they need to develop a career.

We need to provide funds for educating our workforce. Public universities can't push tuition up indefinitely and students can't take on unlimited debt. A skilled workforce works and pays taxes. We seem to have forgotten the public benefit of helping people get better skills.

There's been some speculation that we are entering a period of stagnation. Bullshit. If we didn't invest in our factories, we'd enter a period of stagnation. We've greatly slowed our investment in public goods, and that's producing stagnation. Dwight Eisenhower thought the greatest achievement of his presidency was the Interstate Highway System. He understood that to mobilize a great nation, you need to get the logistics right, and building the highways would make the country more productive.

But since the late 1960s, we've spent too little on public goods. Democrats cared more about programs like Social Security, Republicans cared more about defense spending and cutting taxes. Here's the result:

(from this source:

President Obama has the right idea with his notion of an infrastructure bank, but the loyal opposition seems to think that only private investment increases productivity. Next time you're stuck in a traffic jam, think of all the hours being lost for the want of some transportation spending. Another problem is that we don't get as much per dollar for our infrastructure spending as other developed countries, so we should take a good hard look at the way they do this and learn what we can.

It's always easier to divvy up a growing pie, and we can grow the pie. In doing so, we can put the country back to work.

And if we're to get back to an economy where we work and pay our way, growth and greater equality will have to go hand in hand. As economist Walter Frick noted, “given the diminishing marginal utility of income, it’s hugely wasteful for the super rich to have so much income."

Wednesday, January 15, 2014

Poor laws: Would the death penalty make poor people get jobs?

by John MacBeath Watkins

File:William Hogarth - Industry and Idleness, Plate 3; The Idle 'Prentice at Play in the Church Yard, during Divine Service.png

William Hogarth - Industry and Idleness, Plate 3; The Idle 'Prentice at Play in the Church Yard, during Divine Service

During the reign of Edward VI of England, the poor laws imposed the death penalty for those twice found guilty of vagrancy. First offense was just two years of servitude and being branded with a V, which surely must have helped former vagrants find a new position.

After all, if you want people to stop being poor, you must make being poor more horrible than hunger, cold and want already are, right?

Nowadays, Republicans argue that extending unemployment insurance makes people more dependent, causing them to remain unemployed. I believe this reflects our English legal and cultural heritage. They aren't yet heating up the branding iron, though I suppose I should hesitate to bring up that old custom in certain  company.

At this writing, there are three job seekers for every open job, so it's hard to see how motivating people to look harder for a job would reduce the rate of joblessness. I suspect most people haven't really examined past approaches to the problems of poverty, so perhaps a quick review is in order.

One pipe dream for conservatives is that the poor will be supported voluntarily, preferably through religious organizations. And in fact, in Medieval England, that's how it was done. Monasteries ministered to the poor and the infirm.

This pretty much stopped when Henry VIII broke with the Catholic Church, set up the Anglican Church, closed down the monasteries and used the property to reward those who helped him with this high-handed highjacking of things ecclesiastic. I know of no advanced economy where churches have the kind of wealth and power the pre-Reformation Catholic Church had, so that model appears to be irretrievably broken. Let's review the history of England trying to deal with poverty in the absence of such a powerful church.

Henry VIII's move to privatize the monasteries meant that there were no more monasteries to minister to the poor. Instead, their care went to the government, and was paid for by a tax.

Just to be clear, the state was already involved, not in dealing with poverty per se, but in dealing with idleness. When the Black Plague wiped out as much as 40% of the population of Europe in the 1340s, there was a labor shortage. The cost of labor went up dramatically, causing the cost of food and clothing to go up, and changing the balance of power between landholder and laborer.

To keep the cost of labor from going up too much, the 1351 Statute of Laborers passed, requiring that everyone who could work did so and restricting wages to pre-plague levels, so that landowners would not be faced with a choice of raising wages or leaving land fallow.

And it was these laws that the Tudor kings built upon in their approach to the poor. In 1495, under Henry VII, the law was modified so that "vagabonds, idle and suspected persons shall be set in the stocks for three days and three nights and have none other sustenance but bread and water and then shall be put out of Town." This provision led to a system where if you were poor and received any assistance, such as staying in a shelter, you had to walk to the next town to get another meal and another roof over your head. You would, as they say, have to tramp from town to town, giving us a new noun based on the word tramp. Now, a person who was poor was known as a tramp.

Some people were still unemployed, so Henry VIII tried substituting whipping for the stocks. You might think, "that will teach the blighters not to be unemployed!" but in fact, people continued to be periodically out of work.

During the short and unhappy reign of Edward VI, the monarch saw that people still persisted in being poor, so in 1547 he instituted the branding and penal servitude for the first offense of vagrancy and the death penalty for second offense, as mentioned above. You might think that would keep people from being caught unemployed more than twice, because after that they'd be dead, but justices proved squeamish about sentencing people to death for not having a job.

English law made no provision for those able-bodied persons unable to find a job until fairly late in the day. Under Queen Elizabeth I, able-bodied poor who refused to work would be sent to a house of correction, where they would be beaten to mend their attitude. But what of those willing to work, but unable to find a job?

The next approach was the workhouse, where people were fed the bare minimum, worked in harsh conditions, and experienced a shortened lifespan, which made them an example to all. It seems throughout the Tudor period and later, poverty was deemed necessary so that people would be motivated to work, so the authorities did not wish to make poverty tolerable. Keep those workhouses in mind the next time someone proposes that the poor should have to work to get welfare.

In fact, the whole root of this approach to poverty was based on those laws passed after the Black Plague, which were aimed not at poverty, but at idleness. A worker able to demand higher pay might choose to spend the money on relaxing for a while, and these little vacations would reduce the size of the work force for their duration, putting further pressure on wages. Soon, the laborer might think himself as good as his master!

This approach was never about the relief of poverty, only about power relationships within society. Under Elizabeth I, the law came to recognize the existence of the "deserving poor," at first called the impotent poor because they did not have the power to improve their situation.

The approach of punishing the poor, the approach of making them work, and the approach of making life as a poor person as difficult as possible have all been tried. We've had debtor's prisons, even indentured servitude for debtors. None of this seems to keep people from becoming poor, and many who are poor from remaining so.

Laws can change quickly, but culture changes slowly. The attitudes behind those laws are still with us, still bubbling up in our politics. But as Edward VI showed, even the death penalty will not keep people from being poor.

Monday, January 13, 2014

Smaug, entitlement, and the rich

by John MacBeath Watkins

In an effort to recover from the action-adventure film, Bilbo Baggins and the Temple of Doom, I've been reading the rather bucolic novel it was based on, and ran across this passage, about Smaug noticing that Bilbo has stolen a golden cup:
"Thieves! Fire! Murder! Such a thing had not happened since he came to the Mountain.  His rage passes description -- the sort of rage that is only seen when rich folks that have more than they can enjoy suddenly lose something that they have long had but have never before used or wanted. His fire belched forth, and he shook the mountain-roots...To hunt the whole mountain 'til he had caught the thief and had torn and trampled him was his one thought."
 J.R.R. Tolkien was an Oxford Don, and would have educated the offspring of some of the wealthiest people in England, so I assume he knew whereof he spoke.

When the poor pull an Oliver, like this:

Conservatives complain about a culture of entitlement. But what do you call it when a rich man wants a tax cut, or a tax exemption for donating money to an "educational" non-profit that works to cut Social Security and food stamps, or a public subsidy for constructing a place for his football/basketball/baseball team to play their expensive games?

Ancient Greek mosaic from Caulonia - Italy, via Wikipedia.
Smaug displays this sense of entitlement, raging against the theft of a bauble and feeling justified in wreaking havoc against those less powerful. He is a miser, sleeping on his bed of gold while creating devastation around him, a powerful and wealthy disaster for the country all around. I doubt Tolkien knew or cared much about economics, about the way the gold standard had impoverished Britain at the beginning of the recession until the nation abandoned it, or how rearmament was pulling the nation out of the recession while he was writing the book, but perhaps all this entered his narrative on some unconscious level.

Tolkien's influences probably are strongest before the Depression or WW II. He began writing The Book of Lost Tales while recovering from illnesses stemming from his service at The Battle of the Somme, after all.

But if you think about it, Smaug took a great deal of wealth out of circulation and prevented much commerce from occurring, partly by frying and eating anyone who tried to create any wealth by farming near his lair. Old Smaug was a depression all his own self.

Sunday, January 5, 2014

Wealth redistribution, Boeing style

by John MacBeath Watkins

Last Friday, the International Association of Machinists and Aerospace Workers (IAM) voted by a narrow margin to accept the contract Boeing said was its last offer. They got a signing bonus and the promise that Boeing will build the 777X and the 737 MAX in the state of Washington, a promise of work for years to come, but they also got a shift from a defined-benefit pension to a 401K type which they will be contributing to.

In short, they took a pay cut over the long term in order to keep the work.

Meanwhile, Boeing CEO W. James McNerney, Jr., has been getting raises of about a million dollars a year. From Wikipedia:
While CEO of Boeing in 2007, W. James McNerney Jr. earned a total compensation of $12,904,478, which included a base salary of $1,800,077, a cash bonus of $4,266,500, options granted of $5,871,650, and Other $966,251.[8] His total compensation in 2008 increased to $14,765,410, which included a base salary of $1,915,288, a cash bonus of $6,089,625, and options granted of $5,914,440.[9] In 2009, his compensation decreased to $13,705,435, which included a base salary of $1,930,000, a cash bonus of $4,500,300, options granted of $3,136,251, stock granted of $3,136,242, and other compensation totaling $1,002,642.[10]
I don't doubt that the Boeing machinists were right in thinking the company would send work elsewhere if they had voted no.

But this is a microcosm of how wealth is being redistributed in this country. One reason McNerney is getting big raises is his ability to cut costs by playing off different states against each other. This has actually proven to be a terrible way to build an airplane. Outsourcing parts of the 787 Dreamliner produced a two-year delay in deliveries and delivered some of Boeing's core competencies to companies that may compete with it in the future. Economist have known since at least 1937 that the whole reason firms exist is to avoid the coordination problems and transaction costs that plagued the Dreamliner.

One of the competing sites for the 777X was the former Vought plant in South Carolina that Boeing purchased in order to straighten out problems with production of the 787. Having purchased the plant because it didn't seem to be up to snuff, Boeing has decided that South Carolina is a great place to build airplanes because it's a right-to-work state, meaning that unions have a tough time there. McNerney figures he's less likely to have work stoppages there, and can play it off against the unionized Puget Sound work force to keep wages down.

In short, it's all about who has the power to determine who gets paid what. That, as much as cost cutting, is what's behind the outsourcing we've seen over the last few decades. It's what's been behind efforts to cripple the unions. It's part of a larger effort, as laid out by Lewis Powell in the Powell memo, to get corporate America to shape the laws of this country. Powell, a corporate lawyer who had worked for the tobacco companies, got a chance to be one of the major shapers of those laws when, not long after he'd written the infamous memo, Richard Nixon appointed him to the Supreme Court.

It has taken more than 40 years to get wealth redistributed upward from the machinists of this country to the CEOs. It will likely take at least as long to swing the pendulum back, even if we start now. To do this, it will be necessary for unions and others representing working folks to take the same approach the business community did. They'll have to get people elected who will pass laws and appoint judges who will redress the balance.

It won't be easy. The money is on the other side.

Saturday, January 4, 2014

Dumbing down Tolkien in the second Hobbit movie

by Jamie Lutton

I went to see the second Hobbit movie the other day. Well, it is official; Peter Jackson has lost his mind.

This film was really bad. It is not so much adding characters; he has characters acting like no character Tolkien ever wrote would act.

J. R. R. Tolkien must be spinning in his grave right now.

Where do I start? This review has spoilers in it, so you are warned.

Beorn, the man who was also a bear, a 'shape shifter' as this movie is called, had his part cut so much that he barely recognizable from the book. His character is truncated. When the hobbits encounter the spiders in the forest of Mirkwood, Bilbo takes his ring off to fight them part of the time; which was not in the book, Also an insane decision in general. He can understand their speech while he has the ring on; when he takes the ring off he can still understand their speech.

Then there is this fighting female elf and (!!) Legolas, who is not in the first book at all, show up to fight the spiders and save the dwarves and Bilbo. This is completely made up. We do not meet Legolas until The Lord of the Rings, which takes place 80 years later.. So this is totally wacky. And the female elf is so out of place in Middle Earth . She gets gooey about one of the dwarves, the name of which escapes me, who appears to be the head Dwarve Thorin Oakensheild's son and heir, and this more than anything is out of line.

Tolkien created different species of to inhabit Middle Earth, they are not supposed to cross. they are not supposed to be like humans with different skin colors, they are as different as cats and dogs. They are so different from each other that this is not possible. But a romance is hinted here between the Dwarf and this female fighting Elf.

Hokay, this is fine in dirty Tolkien fan fiction, maybe, the wacky stuff that is circulated on fan sites, but not in the filming of The Hobbit.. This is HERESY.

And the finding of the door into the dwarf city. Well, that scene is ruined. It is so distorted, it only faintly resembles the book

And that dragon. Sorry, he is too talkative. He is something out of Sesame Street, or the Muppet show. Not a dread creature. And while Bilbo has the ring on, the dragon names the ring. This is not in the book, and if this dragon is so smart, why did Gandalf not know about the ring's origin for decades? He knew Bilbo has a magic ring. Not in the book, not in the book, and etc. So Bilbo takes the ring off, in front of the Dragon, as if the dragon would forget about the ring.

There is a sequence where the dwarves try to kill the dragon. Sort of clever, lots of CGI, but it does not work. It serves just to have the dwarves look like they have some derring do, running about like lunatics in the ruined Dwarf city.

So, the dragon, (this part is in the book) goes off to destroy the human city Dale.

This film is far, far more crappy than Peter Jackson's first Lord of the Rings films. I will even say that one decision that Peter Jackson made -to make Sam less servile in those three films - works very well. It is an improvement on the books. Really. But this.this.this is a piece of garbage.

Worse than the first Hobbit film, where the 12 dwarves have great makeup, and are distinctive and interesting, and the scene where they meet Bilbo is very well done.

I left out some other horrible changes...they are legion...but if you watch this movie, and have not read the book. Go get a copy of the book, which is much better, and sit down and enjoy a good read, that has stood the test of time.

Peter Jackson did not need the money...why did he screw up such a great book? He has violated the trust of millions of fans.

My business partner was also outraged. He wrote a separate review on our blog where he called this cock-up BILBO AND THE TEMPLE OF DOOM.

Wish I had ntought of that title....that about sums it up.

Hobbit II: With a vengeance, this time it's personal & etc.

by John MacBeath Watkins

I went to what was advertised as a hobbit movie last night. It appeared in fact to be Bilbo Baggins and the Temple of Doom, or some such bilge, an action-adventure thriller with lots of chase scenes, forbidden love, and martial arts featuring improbable physics, all built on a rather overloaded armature of Tolkien's original plot.

Friday, January 3, 2014

Persecution, Roman and Christian

by Jamie Lutton

My interest in day-to-day life in the Roman empire began when, as a teen, I read the  fictionalized history of the Roman Games, by Daniel P. Mannix IV Called Those About To Die.

This a history the evolution of the games, from the time of Virgil to the end of the empire, about 400 years. This book focused on the lives and fate of the gladiators and how the games devolved from displays of the military for the citizens like our Blue Angels today,  to expensive huge orgies of slaughter of  animals and people. In a few places, Mannix comments on the   murder of Christians and Jews being fed live to lions and other big cats, or even crocodiles, for the amusement of the Pagan crowds in the Colosseum; and most likely as an attempt to suppress the spread of Christianity..

I read Shaw's 100-year-old play Androcles and the Lion a few years later, which tells the same story from the point of view of the Christian slaves and citizens about to be fed to the lions,

This play has always been a favorite of mine, as Shaw as a political playwright attacks the  hypocrisy of modern Christians, comparing them to the cruel Roman authorities who had Christians executed 1,900 years ago.

I just finished reading an amazing collection of letters from the Roman era a few days ago, that tie these two  together, this book must have been one of  the ancient books these authors read as background for their works.

It is  The Letters of the Younger Pliny. . He was a upper class Roman administrator and lawyer of the late first century AD. I knew as a 17year old he was a eyewitness to the eruption of Vesuvius as I had read that in Garber and Garber 's book Volcanoes.

This book  of letters documents life in the late first century, an accessible history of  letters he wrote and letters he received from other Roman administrators, his relatives,  and the Emperor Trajan. As Pliny lives the life of a Roman administrator, lawyer, an engineer, overseeing the building of aqueducts; he also dodges being exiled or executed by a emperor, who had gone crazy, (emperor Domitian.) These letters make fascinating reading as informal autobiography.  But when I found his letter to the Emperor Trajan about his interrogation of Christians, I recalled Shaw, and realized that this book must be this playwright's source material. 

In one letter to the Emperor Trajan, Pliny discusses his interrogation of suspected Christians, with the question of how to handle anonymous tips that this or that person was a Christian.. At this time, belonging to the Christan faith  was a crime against the Roman state. A Christian of that time would not burn incense to Roman gods, which included the emperor.  By not believing the living emperor as a  living God, the early Christan believers were undermining the State in they eyes of the authorities, and thus were committing treason.Also, there is passing reference to the executing of slave women who were priests, or 'deaconess' one of the proofs that Roman women were early Church leaders.

This discussion of interrogation, torture and execution of slaves and free citizens for the treason of being a Christian is chilling, and a reminder to a modern reader like myself of the value of freedom of religion, which is being debated by American citizens right now. Gay and lesbian citizens are struggling for full civil rights such as marriage, in a culture which has self-styled Christians, ironically, here and worldwide denouncing them, condemning them to hell, and some even calling for killing them outright in Africa and elsewhere.

Here is Shaw's heroine, a young woman, replying to an interrogator rather like Pliny, who is asking her to save her life by sacrificing by burning incense to the Roman Gods, in this case the Caesar.

Lavinia:  No. I couldn't. That is the strange thing, Captain, that a little pinch of incense should make all that difference. Religion is such a great thing that when I meet really religious people we are friends at once, no matter what name we give to the divine will that made us and moves us. Oh, do you think that I, a woman, would quarrel with you for sacrificing to a woman god like Diana, if Diana meant to you what Christ means to me? No: we should kneel side by side before her altar like two children. But when men who believe neither in my god nor in their own--men who do not know the meaning of the word religion--when these men drag me to the foot of an iron statue that has become the symbol of the terror and darkness through which they walk, of their cruelty and greed, of their hatred of God and their oppression of man--when they ask me to pledge my soul before the people that this hideous idol is God, and that all this wickedness and falsehood is divine truth, I cannot do it, not if they could put a thousand cruel deaths on me. I tell you, it is physically impossible.

I recommend then the play Androcles And The Lion, by Shaw, The Letters of the Younger Pliny, and Those About to Die by Mannix.

And also the  Garber and Garber book  Volcanoes is very good; the chapter about Vesivus. has a lot of background history of how the people in the classical world understood about volcanoes, and how the local name 'volcano' came to evolve to mean all volcanoes..

In our modern world, we see religious persecution by Christians in America, who say that gays and lesbians threaten public order by wanting civil rights, the right to marry. This is seen as undermining morality, just as the Christians of 100 AD were thought to undermine morality in Rome by refusing to sacrifice  to the Roman Gods and the current Caesar..

By asking Christians to denounce Christ, the Roman authorities were being asked to replay the crime of Judas, a grave sin.   Modern Christians do not 'get' that gays and lesbians have no choice at all to be other than they are, even more so than Christians could..  I wish more modern Christians understand the faith of early Christians, they would be less quick to damn, to deny the rights of gays and lesbians, to even hope for their death...and consider them moral outcasts by merely existing.

Thursday, January 2, 2014

Most popular posts of 2013

by John MacBeath Watkins

Looking back over the past year, the surprising thing is that our most popular posts on this blog tended not to be about books.

In order of popularity:

1) The conspiracy of god, the well-intentioned lie, and the strangeness of being human 

A speculation on the roots of religious belief, part of the series on the strangeness of being human.

2) Stateless income, global capital, and the death of empires (Rethinking liberalism part 11)

How global capital undermines the world political system.

3) Left-handed darkness

About prejudice against the left-handed.

4) Be careful who you are: More on the strangeness of being human

A eulogy to a remarkable woman, and a note on how she'll live on.

 5)Lateen rig, or crab-claw? Building Meerkat, a very small catboat 

 I ended up building the crab-claw rig, which I then gave my sister for her dinghy.

6) The power of forbidden words and the imposition of order

 Another in the series of posts on the strangeness of being human.

7) An easy-to-build alternative to the Blanchard Junior Knockabout

The Blanchard Junior Knockabout is the mainstay of the fleet at the Center for Wooden Boats, especially for teaching sailing, but these boats date back to the 1930s and '40s, and it's getting difficult to maintain them. I propose a stitch & glue alternative that tries to keep the look and feel of the older vessels.

8) Meeting The Goddesses of Kunyang, Okinawa

Marjory Watkins's account of meeting a living goddess.

9) Used e-books: Threat or menace? Publishing in the twilight of the printed word continued

 In which Amazon proposes to sell new copies of e-books as used, while destroying another e-copy of the book.

10) We should prepare for future meteor strikes

 Just what it says.