In 1969, Playboy published a long, freewheeling interview with Marshall McLuhan in which the media theorist and sixties icon sketched a portrait of the future that was at once seductive and repellent. Noting the ability of digital computers to analyze data and communicate messages, he predicted that the machines eventually would be deployed to fine-tune society’s workings. “The computer can be used to direct a network of global thermostats to pattern life in ways that will optimize human awareness,” he said. “Already, it’s technologically feasible to employ the computer to program societies in beneficial ways.” He acknowledged that such centralized control raised the specter of “brainwashing, or far worse,” but he stressed that “the programming of societies could actually be conducted quite constructively and humanistically.”
The interview appeared when computers were used mainly for arcane scientific and industrial number-crunching. To most readers at the time, McLuhan’s words must have sounded far-fetched, if not nutty. Now they seem prophetic. With smartphones ubiquitous, Facebook inescapable, and wearable computers like Google Glass emerging, society is gaining a digital sensing system. People’s location and behavior are being tracked as they go through their days, and the resulting information is being transmitted instantaneously to vast server farms. Once we write the algorithms needed to parse all that “big data,” many sociologists and statisticians believe, we’ll be rewarded with a much deeper understanding of what makes society tick….
Deciphering people’s behavior is only the first step. What really excites Pentland is the prospect of using digital media and related tools to change people’s behavior, to motivate groups and individuals to act in more productive and responsible ways. If people react predictably to social influences, then governments and businesses can use computers to develop and deliver carefully tailored incentives, such as messages of praise or small cash payments, to “tune” the flows of influence in a group and thereby modify the habits of its members. Beyond improving the efficiency of transit and health-care systems, Pentland suggests, group-based incentive programs can make communities more harmonious and creative. “Our main insight,” he reports, “is that by targeting [an] individual’s peers, peer pressure can amplify the desired effect of a reward on the target individual.” Computers become, as McLuhan envisioned, civic thermostats. They not only register society’s state but bring it into line with some prescribed ideal. Both the tracking and the maintenance of the social order are automated….
Even if we assume that the privacy issues can be resolved, the idea of what Pentland calls a “data-driven society” remains problematic. Social physics is a variation on the theory of behavioralism that found favor in McLuhan’s day, and it suffers from the same limitations that doomed its predecessor. Defining social relations as a pattern of stimulus and response makes the math easier, but it ignores the deep, structural sources of social ills. Pentland may be right that our behavior is determined largely by social norms and the influences of our peers, but what he fails to see is that those norms and influences are themselves shaped by history, politics, and economics, not to mention power and prejudice…. Politics is messy because society is messy, not the other way around…. What big data can’t account for is what’s most unpredictable, and most interesting, about us.
Thanks to the world’s largest retailer, another large block of space in Hangzhou, the capital of Zhejiang province, will go on the market at a time when there is generally too much supply. The problem is especially pronounced in the city’s premium office market. Hangzhou’s Grade A office buildings at the end of 2013 had, according to Jones Lang LaSalle, an average occupancy rate of 30%.
The real weakness, however, is Hangzhou’s residential sector. The cause is simple: massive overbuilding. Sara Hsu of the State University of New York at New Paltz writes that Hangzhou faces burgeoning swaths of empty apartment units.
Hangzhou’s market has not yet collapsed. There are still secondary sales, for instance. [Yet] the city has become the symbol of a market in distress. China Central Television on the first of this month devoted a segment to the problems of the unstoppable price decrease” in Hangzhou property in its Economic 30 Minutes show, and discounts in that city, the Wall Street Journalnotes, could be a signal of broader market weakness ahead.
The real estate market in Hangzhou looks like it has just passed an inflection point. It is not so much that fundamentals have deteriorated—they have been weak for some time—as that people’s mentality has changed… .
China is at the point where problems are feeding on themselves. Pessimism about property, which accounts for about 15% of China’s gross domestic product, is beginning to affect the broader economy. Declining property values look scary, despite cheery statements from government officials who assure us the property bubble is not big” or analysts who say that the problems are not systemic. ”But the Chinese don’t look like they are buying either of those views. If this continues, it will have immense impact on the whole Chinese economy,” says an unidentified Hangzhou real estate salesman on Economic 30 Minutes. Without question, everyone thinks there is a bubble. ”
The People’s Republic in the reform era” has not suffered a nationwide property crash. Analysts say the problems in Hangzhou are regional,” but now fundamentals and market sentiment either are or will be pushing markets down across the People’s Republic… . . Premier Li Keqiang has a few tools at his disposal, but they look insufficient to stop a general collapse of property prices across the country. The problems, deferred from late 2008 with massive state spending, have simply become too large. And we must remember that he works inside a complex, collective political system that is generally unable to meet challenges swiftly.
Now that vision of Europe is imperiled once more. “I see Ukraine and Crimea in a bigger context,” Mr. Rasmussen says. “I see this as an element in a pattern, and it’s driven by President Putin’s strong desire to restore Russian greatness by re-establishing a sphere of influence in the former Soviet space.”
Destabilizing Eastern Europe and the South Caucasus is a pillar of the Kremlin’s strategy. “It’s in Russia’s interest to see frozen, protracted conflicts in the region, such as in South Ossetia and Abkhazia in Georgia, Transnistria in Moldova, and Crimea,” Mr. Rasmussen says of regions where Moscow has asserted control. “If you look at a map, you will see why it’s of strategic importance for Russia.”…
The Kremlin needs modern weapons systems and well-trained forces to realize its vision, and Mr. Rasmussen is alarmed by the improvements he has seen in the Russian military during the past few years. Contrasting Russia’s military action against Georgia in 2008 with its invasion of Crimea this year, he says, “we have seen an incredible development of the Russian ability to act determinedly and rapidly. We have seen better preparation, better organization and more rapid action. They have also invested in more modern capabilities. We shouldn’t underestimate the strength of the Russian armed forces.” Now 40,000 of those troops are massed on the border of eastern Ukraine.
Moscow boosted military spending by 79% in the past decade, according to a Brookings Institution estimate, and military spending amounted to 4.5% of Russian gross domestic product in 2012, according to the World Bank. Most Western European states, by contrast, began cutting defense long before the recession and have kept doing so even as their economies have stabilized. France spent 1.9% of its GDP on defense in 2013; Denmark spent 1.4%; Germany, 1.3%; and Spain, 0.9%.
"We in Europe have disarmed too much, for too long," Mr. Rasmussen says. "We can’t continue to cut defense budgets deeply while Russia is increasing her defense budget… . It has created a growing gap across the Atlantic between the U.S. and Europe. Today the U.S. spends around 75% of the overall NATO defense investment. I’m concerned that in the long run it will weaken the trans-Atlantic alliance if this trend continues."
Then there is Europe’s reliance on Russian oil and gas.
Earlier this year, a column by a Harvard undergraduate named Sandra Y. L. Korn briefly achieved escape velocity from the Ivy League bubble, thanks to its daring view of how universities should approach academic freedom.
Korn proposed that such freedom was dated and destructive, and that a doctrine of “academic justice” should prevail instead. No more, she wrote, should Harvard permit its faculty to engage in “research promoting or justifying oppression” or produce work tainted by “racism, sexism, and heterosexism.” Instead, academic culture should conform to left-wing ideas of the good, beautiful and true, and decline as a matter of principle “to put up with research that counters our goals.”
No higher-up at Harvard endorsed her argument, of course. But its honesty of purpose made an instructive contrast to the institutional statements put out in the immediate aftermath of two recent controversies — the resignation of the Mozilla Foundation’s C.E.O., Brendan Eich, and the withdrawal, by Brandeis University, of the honorary degree it had promised to the human rights activist Ayaan Hirsi Ali.
In both cases, Mozilla and Brandeis, there was a striking difference between the clarity of what had actually happened and the evasiveness of the official responses to the events. Eich stepped down rather than recant his past support for the view that one man and one woman makes a marriage; Hirsi Ali’s invitation was withdrawn because of her sweeping criticisms of Islamic culture. But neither the phrase “marriage” nor the word “Islam” appeared in the initial statements Mozilla and Brandeis released…..
What both cases illustrate, with their fuzzy rhetoric masking ideological pressure, is a serious moral defect at the heart of elite culture in America.
The defect, crucially, is not this culture’s bias against social conservatives, or its discomfort with stinging attacks on non-Western religions. Rather, it’s the refusal to admit — to others, and to itself — that these biases fundamentally trump the commitment to “free expression” or “diversity” affirmed in mission statements and news releases.
This refusal, this self-deception, means that we have far too many powerful communities (corporate, academic, journalistic) that are simultaneously dogmatic and dishonest about it — that promise diversity but only as the left defines it, that fill their ranks with ideologues and then claim to stand athwart bias and misinformation, that speak the language of pluralism while presiding over communities that resemble the beau ideal of Sandra Y. L. Korn.
Ever since Lehman Brothers went bankrupt in 2008 a common assumption has been that the crisis happened because the state surrendered control of finance to the market. The answer, it follows, must be more rules. The latest target is American housing, the source of the dodgy loans that brought down Lehman. Plans are afoot to set up a permanent public backstop to mortgage markets, with the government insuring 90% of losses in a crisis. Which might be comforting, except for two things. First, it is hard to see how entrenching state support will prevent excessive risk-taking. And, second, whatever was wrong with the American housing market, it was not lack of government: far from a free market, it was one of the most regulated industries in the world, funded by taxpayer subsidies and with lending decisions taken by the state.
Back in 1856 one of this newspaper’s editors, Walter Bagehot, blamed crashes on what he called “blind capital”—periods when credulous cash, ignoring risk, flooded into unwise investments. Given not only the inevitability of such moments of panic but also finance’s systemic role in the economy, a government had to devise some special rules to make finance safer. Bagehot invented one: the need for central banks to rescue banks during crises. But Bagehot’s rule had a sting in the tail: the bail-out charges should be punitive. That toughness rested on the view that governments should as far as they could treat financiers like any other industry, forcing bankers and investors to take as much of the risk as possible themselves. The more the state protected the system, the more likely it was that people in it would take risks with impunity….
In many cases the rationale for the rules and the rescues has been to protect ordinary investors from the evils of finance. Yet the overall effect is to add ever more layers of state padding and distort risk-taking.
This fits an historical pattern. As our essay this week shows, regulation has responded to each crisis by protecting ever more of finance. Five disasters, from 1792 to 1929, explain the origins of the modern financial system. This includes hugely successful innovations, from joint-stock banks to the Federal Reserve and the New York Stock Exchange. But it has also meant a corrosive trend: a gradual increase in state involvement.
A truly free society is based on a vision of respect for people and what they value. In a truly free society, any business that disrespects its customers will fail, and deserves to do so. The same should be true of any government that disrespects its citizens. The central belief and fatal conceit of the current administration is that you are incapable of running your own life, but those in power are capable of running it for you. This is the essence of big government and collectivism.
More than 200 years ago, Thomas Jefferson warned that this could happen. “The natural progress of things,” Jefferson wrote, “is for liberty to yield and government to gain ground.” He knew that no government could possibly run citizens’ lives for the better. The more government tries to control, the greater the disaster, as shown by the current health-care debacle. Collectivists (those who stand for government control of the means of production and how people live their lives) promise heaven but deliver hell. For them, the promised end justifies the means.
Instead of encouraging free and open debate, collectivists strive to discredit and intimidate opponents. They engage in character assassination. (I should know, as the almost daily target of their attacks.) This is the approach that Arthur Schopenhauer described in the 19th century, that Saul Alinsky famously advocated in the 20th, and that so many despots have infamously practiced. Such tactics are the antithesis of what is required for a free society—and a telltale sign that the collectivists do not have good answers.
Rather than try to understand my vision for a free society or accurately report the facts about Koch Industries, our critics would have you believe we’re “un-American” and trying to “rig the system,” that we’re against “environmental protection” or eager to “end workplace safety standards.” These falsehoods remind me of the late Sen. Daniel Patrick Moynihan’s observation, “Everyone is entitled to his own opinion, but not to his own facts.”
… Far from trying to rig the system, I have spent decades opposing cronyism and all political favors, including mandates, subsidies and protective tariffs—even when we benefit from them. I believe that cronyism is nothing more than welfare for the rich and powerful, and should be abolished….
Instead of fostering a system that enables people to help themselves, America is now saddled with a system that destroys value, raises costs, hinders innovation and relegates millions of citizens to a life of poverty, dependency and hopelessness. This is what happens when elected officials believe that people’s lives are better run by politicians and regulators than by the people themselves. Those in power fail to see that more government means less liberty, and liberty is the essence of what it means to be American. Love of liberty is the American ideal.
Liberals didn’t like the U.S. Supreme Court’s 2010 Citizens United ruling that struck down federal limits on political speech from independent groups because they saw it as a the first step toward dismantling the campaign finance regulatory system that aimed to suppress political speech. They will be just as, if not more, unhappy with the court’s 5-4 ruling [Wednesday] in McCutcheon v. Federal Election Commission that rightly held that federal caps on the amount of money individuals could give to candidates, parties, and PACs are unconstitutional.
But while we can expect to hear a chorus of condemnation of the court from the White House, liberal Democrats, and mainstream media pundits who will see this as opening the floodgates to corruption, the warnings that these rulings herald the end of democracy are false. What the court has done today is to reaffirm core constitutional principles that protect the rights of every American to participate in the political system. But just as importantly, by taking the next step toward dismantling a dysfunctional and deeply unfair regulatory system, the court has opened the way toward a saner manner of conducting elections. While all past efforts at “reform” of contributions had driven donors away from the candidates and political parties, the majority opinion in McCutcheon will begin the process of returning them to a central role in campaign finance. That will create a system that is more accountable and freer of overweening governmental regulation of speech. Instead of condemning this sweeping ruling, liberals should be joining conservatives in cheering a step back toward a saner manner of conducting elections.
It seems as if everywhere you turn these days there are studies claiming to show that America has lost its upward mobility for people born in the lower socioeconomic levels. But there is a sharp difference between upward mobility, defined as an opportunity to rise, and actually having risen.
That distinction is seldom even mentioned in most of the studies. It is as if everybody is chomping at the bit to get ahead and the ones who don’t rise have been stopped by “barriers” created by “society.”
When statistics show that sons of high-school dropouts don’t become doctors or scientists nearly as often as do the sons of Ph.D.s, that is taken as a sign that American society is not “fair.”
If equal probabilities of achieving some goal is your definition of fairness, then we should all get together — people of every race, color, creed, national origin, political ideology, and sexual preference — and stipulate that life has never been fair, anywhere or at any time in all the millennia of recorded history.
Then we can begin at last to talk sense.
I know that I never had an equal chance to become a great ballet dancer like Rudolf Nureyev. The thought of becoming a ballet dancer never once crossed my mind in all the years when I was growing up in Harlem. I suspect that the same thought never crossed the minds of most of the guys growing up on New York’s Lower East Side. Does that mean that there were unfair barriers keeping us from following in the footsteps of Nureyev?
… All groups, families, and cultures are not even trying to do the same things, so the fact that they do not all end up equally represented everywhere can hardly be automatically attributed to “barriers” created by “society.”
Barriers are external obstacles, as distinguished from internal values and aspirations — unless you are going to play the kind of word games that redefine achievements as “privileges” and treat an absence of evidence of discrimination as only proof of how diabolically clever and covert the discrimination is…. Those who preach this counterproductive message will probably never think that the envy, resentment, and hopelessness they preach, and the welfare state they promote, are among the factors keeping people down.
What does the future of business look like? In an informative talk, Philip Evans gives a quick primer on two long-standing theories in strategy — and explains why he thinks they are essentially invalid.
Crowdsourcing, big data, and the collapse of production chains — this is very interesting stuff. (via The Curious Brain)
[W]hile the art of “single-entry bookkeeping” may indeed be “occult” in the sense that it entails a kind of magic trick — namely that of making the costs of a particular policy vanish for political purposes — the art is widely practiced, has a long pedigree, and is viciously effective.
Most progressive policies you can think of — going back to the agriculture and labor laws of the New Deal — are sold to the public only by reference to the benefits for beneficiaries, and never by reference to the far greater costs for society as a whole. Progressive policies are virtually never sold to the public on the basis of an honest cost-benefit analysis. Instead, proponents systematically deny that there are any such costs, and supporters earnestly believe it. This is strange magic indeed, because progressive policies virtually always cause net losses for society as a whole. That’s because they virtually always consist of interventions in the market in the form of limitations on the freedom of exchange. The immediate effect is systematic mis-allocation of resources, hence reduced output and higher prices for everyone — in other words, dead-weight economic loss, as with monopoly pricing.
So how do these policies continue to enjoy so much support? That’s where the artifice of “single-entry bookkeeping” comes into play. If all those poor working families throughout America don’t know that they’re paying far more for milk and sugar than they would in a competitive market — that in essence they’re being defrauded by a conspiracy of government and special interests — then you can get their votes as well as the support of the dairy farmers and sugar producers whose interests you actually serve.
Another Obamacare fiasco? Guess what? We’ll rationalize that disaster into something awesome, tout de suite. You can’t keep your insurance if you like it? Consider yourself lucky. Obamacare disincentivizes work. Be grateful! The Affordable Healthcare Act will cost three times as much as initial estimates? Spending creates jobs. The exchanges have been a disaster? Stop rooting for the president to fail, for God’s sake.
The Treasury Department just announced it will delay a coverage mandate for companies with 50 to 99 employees for a year. And liberals who grouse about the anarchic tendencies of grassroots conservatives will be prepared to rationalize why this news is not only unavoidable but great for Americans. It always is.
According to the Congressional Research Service, the Obama administration has probably missed half of the deadlines of the Affordable Care Act. Here’s a list of 13 executive alterations Now, if all this haphazard implementation were only a matter of improving what are onerous and poorly written facets of Obamacare, that would be one thing. A bad thing, yes. But what makes this free-for-all an especially blatant abuse of power is that the delays are enacted almost exclusively for political reasons.
So, question: when was the last time policy was executed as chaotically and with such little regard for the law? I don’t want to sound like a troglodyte, but the president, as head of the executive branch of the federal government is constitutionally obligated to “take care that the laws be faithfully executed,” not implement laws in an expedient manner, or a more prudent manner, or even in a way that he believes is more moral or a helpful for people struggling to find affordable health care. This is why we write bills down and debate them prior to passage. Or, at least, it used to be.
Responding to a CBO report that suggested the law would encourage more than 2 million people either to seek less work or to leave the labor market completely, progressives picked up their tricornered hats and their muskets, and started to shout incoherently about “freedom.” In a lovely illustration of the truism that progressives really haven’t the slightest clue what it is that conservatives believe, the Huffington Post’s Senior Congressional Reporter, Michael McAuliff, spoke for the cabal, suggesting ludicrously that,
There’s an irony in the GOP complaining that ACA lets people quit jobs. I mean, what’s wrong with freedom?
To answer a remarkably misguided rhetorical question, there is nothing at all “wrong with freedom.” As Patrick Henry rightly argued, above all other things “liberty ought to be the direct end” of government, for, after that, everything else is mere indulgence. But there is an awful lot “wrong” with using the word “freedom” where it does not apply. After all, it is one thing for a person to choose not to work and to accept the natural consequences of that decision, but quite another indeed for a person to choose not to work because others are being forced to subsidize his well-being. One can reasonably attest that redistributing wealth to underwrite preferred social outcomes is “necessary” or “virtuous” or “kind” or “practical” — or even, more cynically, that it is the inexorable end product of a democratic system in which one man can vote himself the contents of another’s wallet. But one cannot claim that it makes either man “free” — at least not without twisting the word and the concept that it represents beyond all meaningful recognition.
Does the Obama administration really plan to make the case that negative liberty is but a mirage and that, the state of nature’s “forcing” one to work being akin to actual compulsion, the state must step in everywhere to liberate the citizenry from reality’s harsh claims? One suspects not.
At the very same time as the White House and its friends were taking credit for having emancipated the American people from the indignities of having to keep down a career, others seemed to be insisting that the labor market and the government are wholly discrete entities. This isn’t about Obamacare “killing” jobs, the Washington Post’s Glenn Kessler wrote, “it’s about workers — and the choices they make.” “Look at it this way,” he explained. “If someone says they decided to leave their job for personal reasons, most people would not say they ‘lost’ their jobs. They simply decided not to work.” To an extent, this distinction is a fair one, although there is a great deal of truth in The Economist’s observation that “a job is an economic transaction between a seller and a buyer of labour, and can be ‘destroyed’ if either seller or buyer walks away.”
Either way, it fails to address the material question, which is, “Why, in this case, will those people ‘decide not to work’?” The answer, of course, is that the intrusive federal action that one party supports and the other opposes has changed the calculation for them. It really is this simple: Before Obamacare, there was a status quo. With Obamacare, the government changed that status quo. As a result of that change, people are making different decisions. One can claim that the change will help to diminish youth unemployment or allow the elderly to enjoy more leisure time or do wonders for the gardening industry. But one can’t pretend that the state doesn’t have full culpability for those different decisions being made. That is a step too far.