The Congressional Killswitch

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Sometimes a story is just so perfect that the immediate response is suspicion, even skepticism, that such a thing could be. Even when backed by unimpeachable evidence, even to relate the story in another context, a reporter (this reporter, anyway) feels he must get the caveats out of the way, even at the expense of burying the lede, because it’s simply too easy to proceed any other way.

So then.

Eleanor Holmes Norton is a Delegate to Congress representing the District of Columbia in the House of Representatives. Though allowed to serve on committees as well as speak on the House floor, DC reps cannot vote on legislation and thus have only symbolic power—hence the District license plate legend, “No Taxation Without Representation.” Holmes was first elected to Congress in 1990 and has faced no substantive opposition to the renewal of her term since, nor will she until she retires.

Google is a very, very large company. Despite early attempts to avoid governmental entanglement, combined with a motto, “Don’t Be Evil,” that is warm and fuzzy by big-biz standards, Google is nonetheless one of the most politically involved corporations in the world, donating many millions to causes such as gay marriage rights and alternative energy sources—as well as to the Democrats, where such ideas are on the whole more welcome. However, in recent years (and in particular, after a potentially nasty antitrust suit) Google has been hedging its bets, courting the Republicans as well to make sure that whoever happens to be on top, Google can still prevail.

If they weren’t so quick on the killswitch, maybe Google wouldn’t need to spend so many of its resources lobbying for approval.

One of Google’s main ongoing projects is the creation of a driverless car—something that can hook into an overarching traffic grid and speed passengers to their destinations without the limitations of human frailty or curiosity: no more merge delays, no more fender benders, no more rubbernecking. Clearly hoping for congressional money to be shoved their way, Google hosted an event for the House Transportation and Infrastructure Committee to showcase their new toy. And as a ranking member of that committee, Holmes was not only invited along, but also given pride of place as the first occupant of the shotgun seat, with results I highly recommend you watch in the video on this page.

For no sooner does she sit down than she wrecks the whole show: “It says Emergency Stop,” she says, while tapping and then smashing a big red button marked with exactly those words. And the Google spokesman (and Carnegie Mellon engineer), trying valiantly to control his panic, replies “Oh, no, don’t press that, it shuts everything down, and it takes some time to, um, recover from that.”

And with all the above caveats out of the way, how perfect an image is this of how legislators interfere with progress in technology and markets? A company wishes to test out a new product, and instead of going to the customers to see if it will succeed, they must first kowtow to those in authority (the representative of all Washington, D.C., as a matter of fact), who promptly misunderstand the device and render it useless—and then have the gall to take some sort of perverse credit for the deed, as implied in the newscasters’ comment: “Norton does think that cars like that could have a future so long as they have safety features like that kill switch.” Thanks, Delegate! Without you we’d never have known how to murder promising technology in mere seconds.

As the further exchange shows, even as a constitutionally powerless member of the House, Norton can still cast a formidable shadow:

“And you know, if they ever get that started, it could be a cool little ride.”
“I guess it still needs a little work.”
“Still needs a little work, yes.”

But despite their gentle, demagogic mockery, the newscasters save for the end a shrewd observation, one that calls into question the very idea of a large-scale federal government: if you are to build such a thing, “Be careful who you put in it—Delegate Norton may not be invited next time around.”

Would that we could all disinvite Delegate Norton, and her 535 cronies actually charged with lawmaking in this country! If they weren’t so quick on the killswitch, maybe Google wouldn’t need to spend so many of its resources lobbying for approval—and the rest of us wouldn’t have to bide our time waiting for advances that would’ve been possible decades ago, apart from the reticence and hesitance of our so-called leaders.



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Ain’t That a Shame?

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“You’d be like heaven to touch, I want to hold you so much.” Is there a more perfect lyric in the world, one reviewer asks. The lyrics of the Four Seasons expressed all the yearning of unrequited love. I can still remember the party where my adolescent heart was stirred while that song played in my mind. “Can’t take my eyes off of you,” I hummed softly, but his eyes adored someone else. Oh what a night — the music of our youth stays with us and has the power to evoke long-dormant memories and emotions.

That’s one reason that Jersey Boys (like Mamma Mia) has had such a long and successful run on Broadway, playing to people who often sing along (to the annoyance of the person in the next seat). The Four Seasons were the “other” ’60s sound — not rock and roll and not Motown but simple, true lyrics sung in clear, clean harmonies with that strong countertenor of Frankie Valli set in just the right key for female teenyboppers. I learned how to sing harmony with the Four Seasons. They were a sound you could play in front of your parents.

Sinatra, another Frank who made it out of Jersey through his glorious voice, is next to the Pope in this story — quite literally.

Their personal lives were another story, however — normalized at the time but recently placed in another light by the Broadway musical and now the film. As represented by the movie, the boys from Jersey — Tommy, Nicky, Joe, and Frankie (Bob was from a nicer background) — were little more than hoodlums, knocking over delivery trucks and breaking into jewelry stores when they were supposed to be in the library. They knew the beat cops by name, and for some of them the local detention facility was like a revolving door, as the characters gleefully admit in the film. Of course, this is the way it’s remembered by Frankie Valli and Bob Gaudio, executive producers of the film; Tommy, Nicky, and Joey might remember it quite differently.

“There were three ways out of the neighborhood,” Tommy DeVito (Vincent Piazza) tells the audience. “Join the army, join the mob, or become famous.” The first two could get you killed, so singing was the ticket out. Sinatra, another Frank who made it out of Jersey through his glorious voice, is next to the Pope in this story — quite literally. Their photos are set in a double frame and stand like a shrine of hope on the living room shelf of Frankie’s childhood home.

The first half of the film focuses on the boys’ backgrounds and their slow rise to fame through seedy nightclubs and bowling alley bars. Waiting over an hour for the first familiar song to appear in this film heightens the drama at its unveiling. I was tapping my foot impatiently. But when it finally arrives it reminds us of how sublime their harmonies were, and how simple their lyrics: “She-e-e-rry, Sherry baby, She-e-erry, Sherry baby. She-eh-eh-eh-eh-erry baby. Sherry baby. Sherry, won’t you come out tonight?” Sheesh! How did that ever make it to the radio? Yet it topped the charts and was followed by hit after hit that told our stories in song.

One of Eastwood’s biggest mistakes was the decision to bring several original cast members and other virtual unknowns from the Broadway stage to the sound stage.

The lyrics of the songs tell the story in the film too, although it all works better in the stage musical, where the production numbers are showcased. Instead of using the lyrics to carry the story forward as most musicals do, Eastwood inserts them almost like a sidebar to the story he prefers to tell. In the film the songs often play in the background, and often while the characters are speaking, so the effect is lessened.

The huge theater where I saw the movie held exactly four viewers at the 7:15 show on opening night. Four Fans for the Four Seasons. Sigh. With the popularity of the Broadway musical (and Clint Eastwood as the producer and director) the film had a disappointing turnout for its opening day. But there’s the rub: Clint Eastwood. Who would have thought this talented octogenarian director known for his spare direction and raw drama would turn to the Broadway musical genre this late in his career? Oh wait — he already did, and it was a disaster. Eastwood starred as the singing prospector who shares a wife (Jean Seberg) with his partner (Lee Marvin, who has purchased her from a polygamous Mormon) in Lerner and Loewe’s Paint Your Wagon (1969), a movie based very loosely on the 1951 play that ran for only 289 performances. Eastwood was ridiculous in that film, and he brings no genuine experience to the filming of this musical. He also uses actors with no genuine experience on screen, intensifying the problem.

One of Eastwood’s biggest mistakes was the decision to bring several original cast members and other virtual unknowns from the Broadway stage to the sound stage. With only one familiar face — Christopher Walken as mob boss Gyp DeCarlo, who acts as a kindly godfather to the Jersey boys — there is no name other than Eastwood’s to attract film audiences. The four who play the Seasons are actually pretty good, (Vincent Piazza as Tommy DeVito, Michael Lomenda as Nick Massi, Erich Bergen as composer Bob Gaudio, and Tony-award-winner John Lloyd Young as Frankie Valli), but they aren’t, well, they aren’t seasoned. Renee Marino, who plays Frankie’s wife Mary onstage and in the film, is simply annoying with her exaggerated movements and wild outbursts of emotion. I actually went home and looked up her background, expecting to learn that she is Eastwood’s newest girlfriend, but she isn’t. (Remember those godawful movies from the ’70s and ’80s when Sondra Locke was his main squeeze? They were every which way but right.) The most interesting actor is Joseph Russo, also a newcomer, and only because he plays Joe Pesci. Yes, that Joe Pesci. He’s credited in the movie with bringing Bob Gaudio into the group, back when Pesci was just another kid from New Jersey. Eventually Tommy DeVito went to work with Pesci, and Pesci took Tommy’s name for his character in Goodfellas.

The problem is that acting for the screen is quite different from acting for a live audience. A movie screen is 70 feet wide, making the actor much larger than life. The flick of an eyebrow or twitch of a finger can relay emotion and communicate thoughts. Stage actors, on the other hand, must play to the balcony. Their actions are broad, even in tender moments. When Mary leans across a diner table with her butt in the air and her lips pouting forward as a come-on to the inexperienced Frankie, it works for the stage but is comical and unrealistic for the screen. And Eastwood should know, because he is the master of unspoken communication. In interviews Marino gushes about how relaxed and easy-going Eastwood was on set, but she needed direction. Desperately. “I need you, baby, to warm the lonely nights” can be said without words and bring tears to the eyes. Keep it simple, and keep it real. As Frankie says to Bob Gaudio about the arrangement of a new song, “If you goose it up too much it gets cheesy.”

That joy comes through in the closing credits of the film, when the cast members dance through the streets to a medley of songs reminiscent of the curtain-call encore

Overall Jersey Boys is a good film that provides interesting background about the music industry. Touring and recording isn’t all glitz and glamour; it’s mostly packing and repacking, eating in diners, staying in nondescript hotel rooms where you aren’t sure which direction is the bathroom in the middle of the night, missing family events, and in the end getting screwed over by unscrupulous money managers. It’s tough. But the film doesn’t give us much perspective about the Four Seasons and the time period in which they wrote. They were the clean-cut lounge singers who made hit after hit side by side with the Beatles, the Beach Boys, and the Rolling Stones. They held their own during the tumultuous ’60s, just singing about love: “Who loves you? Who loves you pretty baby?” They paved the way for a whole new sound in the ’70s when they added a brass orchestra.

Despite the hardships of the touring life, that wonderful music makes it all worthwhile. When asked to describe the best part of being the Four Seasons, Frankie responds simply, “When it was just us four guys singing under a street light.” Anyone who sings knows that feeling. It’s the joy of making music together.

That joy comes through in the closing credits of the film, when the cast members dance through the streets to a medley of songs reminiscent of the curtain-call encore at the end of the Broadway musical. Wisely Eastwood used the recordings of the original Four Seasons for the closing credits instead of the voices of the actors who play them in the movie. The difference is profound. Valli had such a glorious bell-like quality to his falsetto, while Young’s is simply false. He tries hard, but the effort shows. In the first hour of the film, when people react to his voice as he is “discovered,” it’s almost puzzling. What’s so great about this nasally voice with the slight rasp that makes you want to clear your throat? In the closing minutes of this film, listening to the original Four Seasons, it all makes sense.


Editor's Note: Review of "Jersey Boys," directed by Clint Eastwood. Warner Brothers, 2014, 134 foot-tapping minutes.



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That Instructive Tone

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Many years ago, when I was a kid libertarian emerging from the swamps of the New Left, one of my friends, a student of sociology, told me something he had learned in class: among its other functions, government is a means of supplying information.

“What do you mean?” I asked. “Well,” he said, “like when they put up a traffic light. It tells you when to stop and go.”

I was too young to be paying any perceptible amount of money in taxes, so I didn’t think, “So this is why we need a government that spends as much every year as Europe did between AD 100 and AD 1960 — so it can throw that little switch on the traffic light?” But I did think, “Gosh, that’s banal.”

They are either godlike geniuses, capable of projecting complex meaning where it does not exist; or they are a passive and accepting folk, most closely resembling cows. You decide.

Since that time, unfortunately, government has become ever more intent on fulfilling the vital function of supplying information. Its attempts to do so are not limited to “merge,” “no left turn,” “pay your taxes by April 15 (or we are sending you to prison).” In my state, you can hardly eat a meal without being informed, someplace on the menu, that eggs and chickens need to be cooked at such and such a temperature. You can hardly pick up a package of anything without seeing a sign that says:

WARNING: This product contains chemicals known to the State of California to cause cancer and birth defects or other reproductive harm.

You can hardly enter an apartment house without seeing an even more disturbing sign:

WARNING: This Area Contains a Chemical Known to the State of California to Cause Birth Defects or Other Reproductive Harm.

A second or two after grabbing their genitals, most Californians recall that this information is without any merit or interest. Every property in the world includes some substance, some chemical, that might conceivably prevent you from reproducing. Eat enough dirt, and you will never reproduce again.

But lately the “information” conveyed by government has assumed a somewhat more lethal form — lethal to mental health, at any rate. President Obama’s comments are almost all of this nature; and the problem has gotten worse as Obama has moved from Partisan Manipulation and Just Plain Lies to the still deadlier genre of Words for the Ages. Even his diehard followers are reported to be mystified by a new discovery: Obama’s speeches have no content! They never did! Go back and read them.

As for the people who thought those speeches had information to supply, they are either godlike geniuses, capable of projecting complex meaning where it does not exist; or they are a passive and accepting folk, most closely resembling cows. You decide. I’m sure we can agree, however, on the idea that with such encouragement from the top, Obama’s subordinates are very likely to optimize their own potential for banality.

Even his diehard followers are reported to be mystified by a new discovery: Obama’s speeches have no content! They never did! Go back and read them.

Governmental banality manifested itself in virtually Platonic form in remarks delivered on June 11 by Charles Timothy (Chuck) Hagel, former senator, former banker, former head of a cellphone company, former organizer for the Reagan campaign, former official of the Veterans Administration, former lobbyist for a tire company, and current Secretary of Defense. The occasion of his remarks was an investigation conducted by the House Armed Services Committee into the release of Bowe Bergdahl, a soldier who walked away from his post in a combat zone in Afghanistan, was captured by the enemy, and was ransomed at considerable expense by the Obama administration.

Hagel said:

Wars are messy, and they’re full of imperfect choices. . . .You know there’s always suffering through war. There’s no glory in war. War is always about human beings. It’s not about machines. War is a dirty business. And we don’t like to deal with those realities. But realities, they are. And we must deal with them. . . . . . War, every part of war, like prisoner exchanges, is not some abstraction or theoretical exercise. The hard choices and options don’t fit neatly into clearly defined instructions in how-to manuals. All of these decisions are part of the brutal, imperfect realities we all deal with in war.

Now, would anybody ever guess that this man had come to Congress to talk about Bowe Bergdahl?

Of course, it’s hard to talk about something you know absolutely nothing about. Hagel’s comments, on this and other occasions, indicated that he had no idea whether Bergdahl was a deserter or if other soldiers had lost their lives looking for him or if the five Taliban honchos who were released in exchange for him were really important or not. But as Secretary of Defense, he had to talk about something, so he talked about the eternal truths. If someone produces The Wit and Wisdom of Chuck Hagel, these wise observations will need to be included:

Wars are messy.

There’s always suffering through [sic] war.

War is not some abstraction.

War is always about human beings.

War is a dirty business.

And just to keep the troops happy:

There’s no glory in war.

What is the listener supposed to deduce from this string of truisms? Don’t go to war? If you go to war, make sure to obliterate your enemies? All’s fair in a dirty game? What goes around comes around? War is an existential tragedy, best understood by curling up with a Camus novel? War isn’t half so pleasant as a successful career in Washington? Pass me the gin bottle?

Here we have a traffic light that’s blinking red, green, and yellow, all at once. But Hagel’s demeanor insisted that you had to respect any information he supplied. When anyone expressed a hint of skepticism, the Secretary of Defense was miffed.

Watching Hagel’s testimony, I was reminded that Leland Yeager had alerted me to the existence of another exponent of government as information, Environmental Protection Agency Administrator Gina McCarthy. And Yeager was right, although McCarthy turns out to have a very different style from Hagel’s. Hagel (age 67) plays the part of the wise but grumpy old grandfather; he reacts to criticism by twisting around with an expression on his face that suggests his hearing aid is missing and he knows that the questioner has stolen it. By contrast, McCarthy (age 60) is young and hip. At least she thinks she is.

In a long, long speech delivered on June 2, McCarthy puffed something called the Clean Power Plan. In case you hadn’t guessed, this monstrosity has to do with governmental “shaping” and “crafting” of large but impenetrably vague “solutions” to such nonproblems as global warming.

Remember global warming? The idea that people are heating up the globe, or planet? Yes, that’s what we used to hear. But since the expected warming doesn’t seem to be going on, people concerned with the purported emergency have changed their name for it. What government is now supposed to prevent is climate change, climate inaction, or, if you’re really hip, just climate. Those are the words that McCarthy uses in her speech; never once does anything so frank as warming appear. But she is hip, or cunning, enough to realize that some people in her audience know, or have heard somewhere, that there’s been a lot of actual cooling going on. How can she handle that? She handles it by indicating she’s so far ahead of the game that she’s plumb tired of watching it. After all, her sole purpose is to win. So whether the climate is cold or hot — whatever. It makes no difference. We still have weather problems, don’t we? I mean, sometimes the electricity goes off!

If anything, what threatens reliability and causes blackouts is devastating extreme weather fueled by climate change. I’m tired of people pointing to the Polar Vortex as a reason not to act on climate. It’s exactly the opposite. Climate change heightens risks from extreme cold that freezes power grids, superstorms that drown power plants, and heat waves that stress power supplies. And it turns out, efficiency upgrades that slow climate change actually help cities insulate against blackouts.

The solution, of course, is a set of nationwide government interventions, entailing many billions in losses for companies and consumers.

But what strikes me is the tone. It’s the tone of a tenured sage who is tired of people with their petty questions and objections. If that’s the way they are, they’re not worth talking to — even though they’re paying her salary.

Remember, this woman hasn’t even been elected to her exalted position. And she isn’t a person who has won repute by offering the public some goods that it wants to buy. She’s just a government employee. But here she is, talking to people who have either been elected by the public or whose business has been favored in some kind of marketplace, and acting as if it’s her role to give awards at the kindergarten graduation:

I want to give a shout out to all the local officials, rural co-ops, public power operators, and investor owned utilities leading on climate change: It’s clear that you act not just because it’s reasonable, but because it's the right thing to do for the people you serve. Governors and mayors of all stripes are leaning into climate action. They see it not as a partisan obstacle, but as a powerful opportunity. And we know that success breeds success. Those of us who’ve worked in state and local government have seen healthy competition push states to share ideas and expertise. That’s when everybody wins.

If McCarthy actually were a teacher, I would advise her, first, to drop the attempt at pretending to be hip and cool. If you’re not young, you ought to know enough not to do that. But this is a teacher so unwise as to think that somebody’s going to like her to death because she uses expressions like shout out, lean into, and, elsewhere in her rambling, boring, repetitive speech, all about (“This plan is all about flexibility”), a win (“efficiency is a win”), think about it like this, calling our number (“Now, climate change is calling our number”), etc. It must be admitted that there are some signs of authenticity in McCarthy’s youthful patter: she resembles many young people in never having mastered English grammar and syntax. In company with her boss, President Obama, she has not yet learned the “like-as” distinction — and that’s just one example of a grammatical notion she’s never leaned into.

Whether the climate is cold or hot — whatever. It makes no difference. We still have weather problems, don’t we?

Second, I would advise her that one establishes one’s credentials to instruct others by recognizing and avoiding clichés, and not by running after them as if they were one’s heart’s desire. How else could she give us the right thing to do, of all stripes, success breeds success, and everybody wins within the space of five lines? In other passages we get in the driver’s seat, shifts the conversation, proven path,skeptics who will cry the sky is falling (actually, a skeptic would doubt that the sky is falling, but if you’ve collected a lot of clichés, you may as well butcher some), competitive edge, think of our children, cried wolf, bottom line, doomsday predictions that never came true (another odd choice for a person who spends her time warning about apocalyptic climate stuff),and my favorite pair of bromides, “Corporate climate action is not bells and whistles — it’s all hands on deck.”

That, like the earlier list, is selective. In the space available to me, I can’t do justice to McCarthy’s clichés. But go ahead — read the speech. I dare you. I gave you the link.

In the meantime, I ask you: Is she truly exercising the function of government to supply information? What she supplies is attitude, and a very bad attitude indeed. Bad ’tude, dude. No adult should talk to other adults in this way. In fact, no one should talk to anyone in this way. Although both the tone and the total absence of thought will be familiar to all who remember their high school assemblies, that precedent doesn’t make any of this a good, or even a decent, model for discourse of any kind, including high school assemblies.

But here, as bad speakers like to say, I’m reminded of a joke. Once there were two people who were very religious. They went to church all the time; they gave money; they never missed a vigil or a potluck dinner; with them it was all hands on deck. I’ll call this couple Adam and Steve. One Sunday Adam was sick, but he wanted to find out what the new priest had to say that morning, so he sent Steve along to church with instructions to report back to him. So Steve went and returned, and on his return he said, “Do you want the bad news first, or the good news?”

Adam gulped. “I guess,” he replied, “I’d better hear the bad news first.”

So Steve said, “Well, the priest got into the pulpit, and he preached nothing but heresy!”

“Oh my God!” Adam exclaimed. “After that, what could the good news be?”

“The good news,” Steve said, “is that nobody was listening.”

I would place bets on how many people, if any, read that speech by Ms. McCarthy, or, if present, listened to it. I fear that Leland Yeager and I may be her only attentive audience. And Obama’s sermons are just as eagerly followed.




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Action Plus Gravitas

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Tight shot on the face of a man sleeping. His eye snaps open, and it is yesterday morning — again. He rises, and the day unfolds exactly as it did the day before. No one else knows that the day is being repeated, but he remembers, and he reacts. Each time he learns the best way to react in order to get where he wants to be. With eternity to learn and an infinite number of do-overs until he gets it right, the man develops skills, enhances relationships, and eventually gets the girl.

Groundhog Day (1993) is one of my favorite movies, but that’s not the film I am reviewing here. Edge of Tomorrow relies on the same premise of a neverending loop in which a man wakes up day after day in the same place, facing the same dilemma, surrounded by the same people doing and saying the same things. But he changes and grows with each repeated day.

As the film opens, an alien force has invaded Europe, burrowed underground, and started spreading across the continent toward England, China, and Russia. Enter Major William Cage (Tom Cruise), a media specialist with the Army who started in ROTC and rose to the rank of Major through office successes; he has never trained for combat, and he has no intention of going to war. When commanded to go to the front lines of a beach invasion in Normandy, he bolts. When next we see him he is handcuffed, stripped of his rank, and forced to join J Squad on the day they are going to invade France. He has no training with weaponry, doesn’t even know how to disengage the safety, and buckles under the weight of his heavy armor.

It is an unusual treat to see Cruise playing a terrified coward who doesn’t know how to fight, since he usually plays the tough guy who is cool as a cucumber under pressure. Of course, before long he is using his repetition of days to build up his skills and learn how to fight so that he can save the world. It’s an impossible mission, but someone has to do it. Helping him is Lt. Rita Vrataski (Emily Blunt), a war hero known as the Angel of Verdun because she almost single-handedly vanquished the alien enemy in a previous battle. That’s because Rita has also experienced repetition of days and used her repeated experience to anticipate the enemy’s moves. Together she and Cage fight to reach the source of the alien force and destroy it.

The story line is reminiscent of a video game in which the player adopts a character on the screen and fights through several different levels to accomplish a goal. Each time the player “dies” he has to start over, and each time he plays, he gets a little further in the game by remembering where the booby traps are. Often players work together, telling each other which tunnel or path is safe and which one has a lurking danger. Cage and Rita work together in this way, remembering what happened the “previous day” and moving further each time toward their goal. When Cage says to Rita at one point, “We’ve never made it this far before,” it sounds exactly like my munchkins playing Mario together.

It is an unusual treat to see Cruise playing a terrified coward who doesn’t know how to fight.

This video-game reference does not trivialize the film; it simply gives the viewer something more to ponder about metaphysics, the nature of life, and what you might do if you could see into the future and learn from your mistakes. A do-over once in a while could make all the difference.

Santayana said, “Those who cannot remember the past are condemned to repeat it.” Director Doug Liman has remembered and learned from the past. While Edge of Tomorrow borrows heavily from the concept of Groundhog Day, it is not doomed in any way. Moreover, Liman brings to this project a strong history in action films from his work directing the Bourne series. Edge of Tomorrow is fresh, exciting, and compelling. The references to the storming of Normandy give it a sense of gravitas missing from most modern action films (it was even released on June 6, to coincide with the anniversary of the invasion). The threat of a lurking menace that spreads unseen and underground until it has become unstoppable and can enter one’s mind gives the audience a sense of personal investment while suggesting that the enemy is a thought or philosophy, not an army. Even the solution for stopping the enemy — that is, getting inside the enemy’s mind and understanding his perspective — is also a powerful lesson for modern warfare. Edge of Tomorrow works on every level.


Editor's Note: Review of "Edge of Tomorrow," directed by Doug Liman. Warner Brothers, 2014, 113 minutes.



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Farmers of Men

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When people use the term “the homeless,” they make them sound like a leper colony of the damned, invaders from outer space, or some sort of creeping fungus. This attitude dehumanizes homeless people. Which is highly ironic, since those most likely to use the term see themselves as brimming with compassion. How can people be recognized as human beings if they aren’t viewed as individuals? Yet almost never do I get the sense, from those who decry the plight of “the homeless,” that they visualize real faces or remember actual names.

We’ve been getting a number of homeless people at church. The sudden influx is startling. One lady brings her four little dogs. She has nowhere to leave them except in the yard of our parish house, next door to the sanctuary. She sits in a pew, slightly off by herself, and soaks up the liturgy the way a flower soaks up sunshine. We are a progressive church — we Care About The Homeless. But nobody seems to know quite what to do with her.

When we hand over to the government the responsibility to care for those less fortunate than ourselves, we also give it the notion that it has taken the matter completely out of our hands.

Some are baffled that she’s got four dogs, when she probably struggles daily just to feed herself. They evidently fail to realize that the dogs may be the only living souls that show her unconditional affection, or perhaps any affection at all. Being one of those annoying people who get big ideas, I have several times wondered aloud what we might do to help our homeless guests. And I mean, really help them — not just go through a few motions to make ourselves feel better. Every time I do this, I get looks of horror.

Then comes the inevitable litany of “we can’ts.” We can’t give them hot meals, baskets of groceries, job referrals, or affordable housing. We are not, after all, a soup kitchen, a food bank, or a social service agency. But I’m pretty sure that though they may not know this the first time they come, it doesn’t take long for them to figure it out. If they keep coming back — as some do — they may actually want the same things out of the experience as the rest of us.

The homeless aren’t as different from us as I suspect we want to think they are. How did we ever come to think of them as a different species? As something alien, strange, and potentially dangerous?

I suspect it began to happen about the time we decided to hand all responsibility for the care of the unfortunate over to the government. It became Someone Else’s Problem — not our own. We tell ourselves we’ve done this because we’re so compassionate, but actually it has made us considerably less so. We have merely pushed the needy out of sight and out of mind, lulling our consciences to sleep with the narcotic delusion that Someone Else can do our caring for us.

We have no evidence, however, that the government overflows with compassion. And when we hand over to it the responsibility to care for those less fortunate than ourselves, we also give it the notion that it has taken the matter completely out of our hands. Once we surrender anything to the state, it never wants to give it back, and certainly resents having to share it.

Much ado is currently being made about how persecuted conservative Christians are when the state does not mandate mass compliance with their beliefs. That this seems to be the highest purpose to which they think the Gospel calls them does not strike them as the least bit odd. But the same government they want to enforce their dictates has taken away much of their ability to minister to the needy. A duty they have surrendered, for the most part, without a whimper.

This past winter, when much of the country was gripped with arctic cold, a number of churches brought homeless people into their buildings to keep them from freezing. In more than a few cases, this may have made the difference between life and death. Now, one might think this was exactly what churches are supposed to do. But several municipal governments thought otherwise.

When we farm the homeless out to government care, they get no care at all. The government treats them as less than human.

Where were the cries of religious persecution, from the Right-wing Umbrage Industry, when these cities ordered churches that were sheltering homeless people to turn them out into the streets, threatening them with hefty fines if they refused to comply? I certainly didn’t hear any, and since I pay close attention to such matters, I listened for them.

Perhaps the best thing we can do for the homeless among us is really to see them as people — and I mean, before they turn into blocks of ice we must step over on the sidewalk. When we farm them out to government care, they get no care at all. The government treats them as less than human. Given the fact that it’s more likely to care for stray dogs or cats than for homeless people, it treats them as even less than animals.

The only way we can treat homeless people as people is to take back our responsibility to care what happens to them. When they come through the doors of our churches, we can recognize them as spiritual beings, who hunger for more than food. They need to know that they are valuable. That it matters whether they find a warm place to belong, or rot into oblivion in a gutter. This, no government can give them, and when we farmed out the responsibility for their care, all understanding of their deeper needs got lost.

Today we clamor, like baby birds, for the government to give us goodies. Our dependence has bred a malignant narcissism, in which we identify primarily as members of some grievance group to be appeased. The very convictions that form our core we see as somebody else’s responsibility to ensure. But the government cannot give us our souls; it can only take them. It’s high time we took them back.




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Iraq and Isolationism

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I have no wisdom to offer about the current crisis in Iraq; I’m simply immobilized by astonishment over the idea, still dominant in Washington, that the United States should arrange and enforce a united Iraq. But I do have some thoughts about libertarian attitudes toward Iraq and other targets of American intervention.

Isolationists — and almost all libertarians are isolationists of some kind — can take pride in opposing the intervention that overthrew Saddam Hussein. It would have been better for virtually all concerned in this mess if Saddam, lunatic fool that he was, had stayed on his throne. Then at least we might not have seen the victory, in one part of the country, of a corrupt Shi’ite authoritarianism, and the worse victory, elsewhere, of a mob of howling Sunni fanatics vowing to lock women in their houses and behead or crucify all opponents of their holy cause. They have already advertised on the internet the massacre of hundreds or thousands of captured and disarmed soldiers of the Iraqi government — the kind of atrocity that even Hitler concealed.

It would have been better for virtually all concerned in this mess if Saddam, lunatic fool that he was, had stayed on his throne.

But there is something about this situation that isolationists should consider more carefully than we usually do. There is evil, intractable evil, in this world, and the more we isolate ourselves from it, the more intractable it reveals itself to be. America’s gradual withdrawal from world military conflict allows us to see more clearly that this evil cannot all be attributed to America, or the West, or colonialism, or imperialism, or G.W. Bush or Barack Obama or even the accursed Lyndon Johnson. The enslavement of women in Nigeria is not an effect of Western intervention. The vile fanaticism of the Iraqi insurgents is not the result of Western intervention. The modern steel gallows on which the religious leaders of Iran hang gay men are not the effect of Western hegemony. Like the other things I just mentioned, they are an attempt to appropriate the material culture of the West and place it in the service of depraved native ideals.

When I see a sign that says “Live and Let Live” my heart leaps up. That is liberty; that is what I believe in. But I do not believe that most cultures in the world are based on that principle, or that they would be if we would simply obey it ourselves. Libertarian commentary on American foreign policy often creates the impression that the extended meaning of “Live and Let Live” is “All Will Be Well If You Do.” It won’t. There is evil in America, and by the same token there is evil in the rest of the planet, and plenty more of it — inexhaustible supplies, in fact. Isolation is not the road to utopia. It should be the road to realism.




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Drowned in the Jury Pool

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The other day I reported for jury duty. In California, you report for one day, and if you aren’t lucky enough to get on a jury, you’re out for at least the next year. I’ve gone through this four or five times now, and only once did I land on a jury. That jury was hung, partly because the august legal minds empaneled a woman who claimed that her profession was teaching the principles of jury selection to students in a junior college. She proved to be, as almost anyone would have anticipated, an enormous pain in the ass.

This year, I waited in the “jury lounge” for several hours, not even pretending to watch a propaganda film about how wonderful it is to serve on a jury. I puzzled over the wording of my next book, chatted with a couple of people who, like me, wished devoutly not to get on a jury, celebrated the fact that it was 11:45 and no calls for jurors had been made — and then it happened. My name was announced as one of the 40 people who had to assemble in Superior Court, Section Such and Such, to be examined by the judge and attorneys to determine whether we were fit to decide whether someone should go to jail for burglary and such and such and so and so, and possession of methamphetamine.

The way they do this is to get all 40 victims into the courtroom, and then particularly examine the first 21, to see whether some of them should be replaced by some of the other 19. Why 21, I don’t know. I was randomly assigned a position as Prospective Juror No. 9.

Once we jurors had been properly infantilized, we were taken into the courtroom, seated in our places, and asked a series of questions by the judge.

My cohort’s progress into the jury room was impeded by a court official who spent 25 minutes checking off the list of 40 randomly generated names. He made jokes about his age, and his eyeglasses, and his difficulty reading the list, and our names, and his mispronunciation of our names, as if it mattered how he pronounced anything. He may have been wasting time because the judge wasn’t ready to invite us in. So if the dentist is late, does he have one of his assistants come out to the waiting room and start drilling your teeth?

Once we jurors had been properly infantilized, we were taken into the courtroom, seated in our places, and asked a series of questions by the judge. She turned out to be very sensible. She explained what she was doing with great succinctness, asked her questions clearly, and found ways to limit our answers to what was relevant. She was a welcome relief from my last judge, who when confronted by an elderly man who announced with pride that he had been a member of more than 30 juries and had always enjoyed himself, invited the aged idler to entertain us with stories from his service to American justice. The current judge wasn’t like that. After her round of examination, she gave the prosecuting attorney and the defense attorney just 15 minutes each to ask their own questions. I quickly grew to like her.

But what I’ll always remember is the responses of my fellow prospective jurors.

The man who answered the judge’s question, “Would you believe that the defendant is guilty just because he’s sitting at the defendant’s table?” by saying, “Yes. I mean, why else would he be the defendant?” Body language suggested that he wasn’t just trying to get off the jury. He was being honest.

The woman who, thoughtfully and repeatedly, said that she could not serve on a jury because her religious beliefs did not allow her to judge her fellow men. When I spoke with her at the end of the day, she proved to be a Christadelphian, a member of a sect that I had studied but of which I had never met a single member. This was a big deal for me. She was a nice person and probably the most intelligent person I met all day.

She tried to argue me into it. Surely I could vote on a question of fact?

The woman who, when asked whether she or any member of her family had been a victim of crime, revealed that her mother’s car had once been stolen, “and she never got it back!” She started crying hysterically and was told to go home.

The woman who, almost as hysterically, answered several questions by saying that she wouldn’t have a bias about someone accused of drug possession, but if she thought he committed a crime because he was “addicted,” she could never forgive him, “never! never!

The woman who said she had friends who were going to law school, and they told her that “there were things going on behind the scenes,” evidently “things” in the legal system, and therefore . . . something. The judge tried to get her to say what the “things” were, tried to joke with her about how law students sometimes make remarks that don’t mean very much, tried to get her to put some definition to anything she said. But her efforts were futile. She gave up.

The man who answered every question about things that might affect his judgment with some story about his “partner,” his “current partner,” or his “partner in the 1980s,” and who was concerned that his “partner in the 1980s” had a relative who was a “correctional officer.” “Do you know that person?” the judge asked. “No . . . I never met him.”

The woman who answered the question about whether police officers ever lie with an adamant declaration that no, they never do. Never? the judge asked. No, never. The judge’s eyes widened; she was obviously repressing the desire to say something like “What kind of an idiot are you?” Members of the jury pool had less luck repressing their laughter. The judge kept questioning the woman, trying to get her to say whether there was any possibility that any police officer might ever say anything except the truth. Finally the woman conceded that if you got together enough thousands and millions of police officers, one of them might possibly, on some occasion, probably in private, deviate very slightly and unintentionally from the exact truth.

The several people who plainly did not speak English with any facility but who were emphatic in correcting the judge about her pronunciation of their names.

The several people who, refreshingly, laughed off all mispronunciations.

The man who, very, very seriously, reviewed the long and irrelevant history of his employment.

The woman who, very enthusiastically, responded to every question with an account of the social work that she and her husband perform.

The many people who recounted friends’ and relatives’ run-ins with the law, almost always incidents about driving while under the influence (not injuring anyone, mind you) or using recreational drugs, then shrugged and said, “No, the punishment was fair; he brought it on himself.”

If you’ve been adding up this list, you can see that there were a lot of people in that first cut of 21 who may not have belonged on a jury.

What about me? I didn’t belong either. At the appropriate moment, I advised the judge that I thought it was immoral to convict anyone on a drug charge. She read a statement about juries not deciding the law for themselves, and I said that yes, I understood, but in the case of victimless crimes I was in favor of what the statement was trying to exclude, which was jury nullification. She smiled and said, “Yes, that’s what we’re talking about.”

The judge’s eyes widened; she was obviously repressing the desire to say something like “What kind of an idiot are you?”

The defense attorney of course wanted me to be empaneled, so she tried to argue me into it. Surely I could vote on a question of fact? Surely I could determine whether someone possessed methamphetamine? Surely that wouldn’t be convicting anyone? Surely only a judge can sentence anyone? I told her I could see where that train was going, and I wouldn’t get on it. The prosecuting attorney smiled and joked with me, suggesting that I was arrogant enough to think I knew better than everyone else. Maybe he was right, but I was wondering why he bothered. Maybe he was trying to discourage anyone else from acting like me in the jury room. By this point, ironically, I was getting interested in the process and mildly regretting that I wouldn’t get to serve.

After a couple hours of jury examination, punctuated by a short break that turned into a longer break, the judge called the attorneys into her chambers. A few minutes later they came back, and she announced that five people were excused: me, the young Mexican American who sat next to me, the Christadelphian lady, and two others whom I couldn’t connect with the answers they’d given. The Mexican American was a working class kid who had started responding to questions about drug convictions with answers like, “I don’t know. . . I could follow the law. But with recreational drugs . . . I dunno . . . It doesn’t seem right. . . . Well, yeah, I guess so.” After listening to the back and forth about me, he reached a more definite position. He said he would not vote to convict anyone for drug possession. I didn’t talk to him during the breaks, or at any other time; but maybe I was responsible for his values clarification.

And so it ended. I walked out of the courthouse, chatting with the Christadelphian lady, then proceeded to the eight-dollar-a-day parking lot, having experienced the American jury system in what may be nearly its finest hour.




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Another Perspective on Piketty

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Someone acquainted only secondhand with Thomas Piketty’s book translated as Capital in the Twenty-First Century or who has only skimmed it might well dismiss it as a mere leftist, redistributionist tract. That would be a mistake and injustice — and thus counterproductive. Libertarian critics should try to answer Piketty’s findings, attitudes, and recommendations respectfully and seriously (unless, of course, they find themselves converted away from their own doctrine).

His tome of viii + 685 pages, full of tables, charts, and citations, is an impressive work of resourceful scholarship. A massive and detailed web site supplements it. I have neither the time and energy nor the competence to verify his voluminous statistics. Pieced together, as some of them are, from fragmentary sources (such as tax and probate records) of decades and even centuries ago, they must incorporate some elements of interpolation and educated guessing. Still, no reason is apparent for questioning his and his collaborators’ diligence and honesty.

Piketty avoids the pretensions of so much academic economics — decorative mathematics and dubious econometrics. (“[M]athematical models ... are frequently no more than an excuse for occupying the terrain and masking the vacuity of the content,” p. 574.) His book employs, and sparingly, only the simplest algebra; but I did find a few symbols and their definitions bothersome.

Piketty’s case for reforms is not mainly an economic argument but a sustained appeal to the reader’s intuition against extreme inequality.

For example, Piketty makes much of the inequality r>g as the condition of growth of the ratio of capital (wealth) to national income, g being the growth rate of the denominator. The condition would be trivially obvious if r, the numerator, were the growth rate of the capital stock; but Piketty usually, and misleadingly, calls it the “rate of return on capital.” That description would apply if all and only the earnings on capital were saved and reinvested. Expenditure of some capital earnings on consumption instead would reduce the growth of the capital stock and the capital-income ratio, as Piketty occasionally mentions; and saving or dissaving from labor income would also affect the ratio’s growth (or shrinkage).

Nevertheless, Piketty’s compilation of long-term statistics for several countries suggests a trend to him. Only occasionally does he mention that most of his income figures are of income before taxes and before supplementation by government redistribution. Anyway, the long-term trend of the capital-income ratio seems to have been upward, exacerbating the inequality of both wealth and income. The chief historical exception is the period 1914–1945, when wars and depression destroyed so much wealth.

Piketty gives particular attention to the concentration of income and wealth in the top 1%, or even the top tenth or hundredth of 1% of their distributions. He seems particularly concerned about great inherited fortunes and the lavish leisured lifestyles that they make possible (as in novels by Jane Austen and Honoré de Balzac, mentioned as a welcome change of pace from dense argument).

His remedy for great inequality would be not only highly progressive income and inheritance taxes but progressive annual taxes on total wealth itself. He recognizes the political unlikelihood of getting his wealth taxes enacted and enforced, however, because implausibly close international collusion of governments would be required. He draws on the literature of Public Choice little if at all. He supplements his arguments with page after page of the history of taxation in different countries.

Nowhere, as far as I noticed, and to his credit, does Piketty blame inequality for economic crises and depressions or commit the crude Keynesianism of recommending redistribution to raise the propensity to consume. He does not maintain that the apparent trend toward greater inequality will continue without limit. He does not maintain that the extreme wealth of only a few thousand families will give those few tyrannical power over their fellow citizens — far from few enough, actually, to be a coherent oligarchy. Nor does he (or his translator) toss about words like “unfair” and “unjust,” although he does occasionally aspire to more “social justice” and “democracy” in the inexpediently and popularly stretched sense of the latter word.

One might expect concern about inequality to include concern about further concentration of resources and power in the state. However, Piketty does not expect his more drastic and broad-based progressive taxes to raise much more revenue. Nor, perhaps inconsistently with not expecting this, does he worry about damaging incentives to work and innovate. Possibly he agrees with John Stuart Mill in thinking that the distribution of wealth can be separated from its production. Possibly, like José Ortega y Gasset’s Mass Man (The Revolt of the Masses, 1930), he regards the wonders of modern industrial civilization as automatically existing, like facts of nature. Although an avowed socialist in the loose European sense of the term, he does not want to destroy capitalism. He even welcomes considerable privatization: government agencies and employees need not themselves provide all the services that tax money pays for.

Wealth is not something that belongs to the government, which it may leave to its producers or redistribute as the country’s rulers see fit.

For Piketty, reducing inequality is a goal in its own right. I agree so far as reducing it means undoing government measures that actually foster it. These include aspects of crony capitalism: subsidies, tax privileges, protection from both domestic and foreign competition, and most of what makes highly paid lobbying worthwhile. Also at others’ expense, arguably, a policy of artificially low interest rates benefits Wall Street operators and wealthy stock investors and traders.

As I ended reading his book, I realized that Piketty’s case for reforms is not mainly an economic argument but a sustained appeal to the reader’s intuition, although not explicitly to envy. Intuition presumably carries more weight if the reader comes to share it himself without having actually been told what to think. If so, Piketty’s economic language and massive quantities of ingeniously gathered statistics amount to what I call a Murray Rothbard or Alan Reynolds style of argument: deploy such an array of facts and figures, dates, places, mini-biographies, and even personality sketches that, even if they scarcely add up to a coherent argument, you come across to your reader or audience as a consummate expert whose judgments command respect. But saying so may exaggerate; for Piketty’s tables, charts, and sketches of characters in novels may usefully jog the intuition. Anyway, one should not disparage Piketty’s impressive research and methods and their likely application in projects beyond his own.

As for an intuition against extreme inequality, I confess to one of my own, although it does not mean welcoming heavier and more progressive taxes. We should worry about undermining respect for private property as a human right and essential pillar of any functioning economic system. Wealth is not something that belongs to the government, which it may leave to its producers or redistribute as the country’s rulers see fit.

Still, the intuition persists, as it did with Henry Simons, that saint of the Chicago School of economics in its early days, who found inequality “unlovely,” and as it persisted with Nobelist James Buchanan, prominent libertarian, who advocated stiff inheritance taxes. Somehow, I am uneasy about the pay of executives said to be 600 times as great as the pay of their ordinary workers, even though they may well contribute more than that much to their companies’ revenues. I am uneasy about lifestyles of opulent leisure permitted by great inherited wealth, rare though they may be. I cannot justify or explain my intuition, which, anyway, is not crass envy.

I don’t call on public policy to heed that intuition, any more than I share the apparently spreading expectation that some authority take action against whatever offends somebody, whether the lifestyle, the behavior, the speech, or the suspected thought of someone else. I wouldn’t want an egalitarian intuition implemented in anything like Piketty’s ways. Government measures to alleviate or avoid actual poverty, even beyond the “safety net,” are something quite different.

An intuitive dislike of extreme inequality does not rule out unease at Piketty’s line of thinking. Again, however, I warn libertarians: don’t risk a boomerang effect by unfairly dismissing his work as a mere ideological tract. It is indeed a work of genuine scholarship. Dealing with its challenging ideas can strengthen the libertarian case.


Editor's Note: Review of "Capital in the Twenty-First Century," by Thomas Piketty, translated by Arthur Goldhammer. Belknap Press, 2014.



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Mind the Gap

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“Capitalism automatically generates arbitrary and unsustainable inequalities that radically undermine democratic societies.” — Thomas Piketty, Capital in the 21st Century

French professor Thomas Piketty’s new book — ranked #1 on Amazon and the New York Times — is a thick volume with the same title as Karl Marx’s 1867 magnum opus, Capital. Many commentators have noted the Marxist tone — the author cites Marx more than any other economist — but that’s a distraction.

The author discusses capital and economic growth, and recommends a levy on capital, but the primary focus of the book is inequality. In mind-numbing minutiae of data from Europe and the United Staes, Piketty details how inequality of income and wealth have ebbed and flowed over the past 200 years before increasing at an “alarming” rate in the 21st century. Because of his demonstrated expertise, his scholarship and policy recommendations (sharply higher progressive taxes and a universal wealth tax) will be taken seriously by academics and government officials. Critics would be wise to address the issues he raises rather than simply to dismiss him as a French polemicist or the “new Marx.”

According to his research, inequality grows naturally under unfettered capitalism except during times of war and depression. “To a large extent, it was the chaos of war, with its attendant economic and political shocks, that reduced inequality in the twentieth century” (p. 275, cf. 471) Otherwise, he contends, there is a natural tendency for market-friendly economies to experience an increasing concentration of wealth. His research shows that, with the exception of 1914-45, the rate of return on property and investments has consistently been higher than the rate of economic growth. He predicts that, barring another war or depression, wealth will continue to concentrate into the top brackets, and inherited wealth will grow faster with an aging population and inevitable slower growth rates, which he regards as “potentially terrifying” and socially “destabilizing.”

If market-generated inequality is the price we pay to eliminate poverty, I’m all in favor.

His proposal? Investing in education and technical training will help, but won’t be enough to counter growing inequality. The “right solution” is a progressive income tax up to 80% and a wealth tax up to 10%. He is convinced that these confiscatory rates won’t kill the motor of economic growth.

One of the biggest challenges for egalitarians like Piketty is to define what they mean by an “ideal” distribution of income and wealth. Is there a “natural” equilibrium of income distribution? This is an age-old question that has yet to be resolved. I raised it in a chapter in “Economics on Trial” in 1991, where I quoted Paul Samuelson in his famous textbook, “The most efficient economy in the world may produce a distribution of wages and property that would offend even the staunchest defender of free markets.”

But by what measure does one determine whether a nation’s income distribution is “offensive” or “terrifying”? In the past, the Gini ratio or coefficient has been used. It is a single number that varies between 0 and 1. If 0, it means that everyone earns the same amount; if 1, it means that one person earns all the income and the rest earn nothing. Neither one is ideal. Suppose everyone earns the same wage or salary. Perfect equality sounds wonderful until you realize that no economy could function efficiently that way. How you could hire anyone else to work for you if you had to pay them the same amount you earn?

A wealth tax destroys a fundamental sacred right of mankind — the right to be left alone.

Even social democrats William Baumol and Alan Blinder warned in their popular economics textbook, “What would happen if we tried to achieve perfect equality by putting a 100% income tax on all workers and then divide the receipts equally among the population? No one would have any incentive to work, to invest, to take risks, or to do anything else to earn money, because the rewards for all such activities would disappear.”

So if a Gini ratio of 0 is bad, why is a movement toward 0 (via a progressive income tax) good? It makes no sense.

Piketty wisely avoids the use of the Gini ratios in his work. Instead he divides income earners into three general categories, the wealthy (top 10% income earners), the middle class (40%), and the rest (50%), and tracks how they fare over the long term.

But what is the ideal income distribution? It’s a chimera. The best Piketty and his egalitarian levelers can do is complain that inequality is getting worse, that the distribution of income is unfair and often unrelated to productivity or merit (pp. 334–5), and therefore should be taxed away. But they can’t point to any ideal or natural distribution, other than perhaps some vague Belle Époque of equality and opportunity (celebrated in France between 1890 and 1914).

Piketty names Simon Kuznets, the 20th century Russian-American economist who invented national income statistics like GDP, as his primary antagonist. He credits Kuznets with the pro-market stance that capitalist development tends to reduce income inequality over time. But actually it was Adam Smith who advocated this concept two centuries earlier. In the Wealth of Nations, Smith contended that his “system of natural liberty” would result in “universal opulence which extends itself to the lowest ranks of the people.”

Not only would the rich get richer under unfettered enterprise, but so would the poor. In fact, according to Smith and his followers, the poor catch up to the rich, and inequality is sharply reduced under a liberal economic system without a progressive tax or welfare state. The empirical work of Stanley Libergott, and later Michael Cox, demonstrates that through the competitive efforts of entrepreneurs, workers, and capitalists, virtually all American consumers have been able to change an uncertain and often cruel world into a more pleasant and convenient place to live and work. A typical homestead in 1900 had no central heating, electricity, refrigeration, flush toilets, or even running water. But by 1970, before the welfare state really got started, a large majority of poor people benefited from these goods and services. The rich had all these things at first — cars, electricity, indoor plumbing, air conditioning — but now even the poor enjoy these benefits and thus rose out of poverty.

Piketty and other egalitarians make their case that inequality of income is growing since the Great Recession, and they may well be correct. But what if goods and services, what money can buy, becomes a criteria for inequality? The results might be quite different. Today even my poor neighbors in Yonkers have smartphones, just like the rich. While every spring the 1% attend the Milken Institute Conference in LA that costs $7,000 or more to attend; the 99% can watch the entire proceedings on video on the Internet a few days later — for free. The 1% can go to the Super Bowl for entertainment; the 99% gather around with their buddies and watch it on an widescreen HD television. Who is better entertained?

Contrary to Piketty’s claim, it’s good that capital grows faster than income, because that means people are increasing their savings rate.

Piketty & Co. claim that only the elite can go to the top schools in the country, but ignore the incredible revolution in online education, where anyone from anywhere in the world can take a course in engineering, physics, or literature from Stanford, MIT, or Harvard for a few thousand dollars, or in some cases, for absolutely nothing.

How do income statistics measure that kind of equal access? They can’t. Andrew Carnegie said it best, “Capitalism is about turning luxuries into necessities.” If that’s what capital and capitalism does, we need to tax it less, not more.

A certain amount of inequality is a natural outcome of the marketplace. As John Maynard Keynes himself wrote in the Economic Consequences of the Peace (1920), “In fact, it was precisely the inequality of the distribution of wealth which made possible those vast accumulations of fixed wealth of and of capital improvements which distinguished that age [the 19th century] from all others.”

A better measure of wellbeing is the changes in the absolute real level of income for the poor and middle classes. If the average working poor saw their real income (after inflation) double or triple in the United States, that would mean lifting themselves out of poverty. That would mean a lot more to them than the fortunes of the 1%. Even John Kenneth Galbraith recognized that higher real growth for the working class was what really mattered when he said in The Affluent Society (1959), “It is the increase in output in recent decades, not the redistribution of income, which has brought the great material increase, the well-being of the average man.”

Political philosopher James Rawls argued in his Theory of Justice (1971) that the most important measure of social welfare is not the distribution of income but how the lowest 10% perform. James Gwartney and other authors of the annual Economic Freedom Index have shown that the poorest 10% of the world’s population earn more income when they adopt institutions favoring economic freedom. Economic freedom also reduces infant mortality, the incidence of child labor, black markets, and corruption by public officials, while increasing adult literacy, life expectancy, and civil liberties. If market-generated inequality is the price we pay to eliminate poverty, I’m all in favor.

I have reservations about Piketty’s claim that “Once a fortune is established, the capital grows according to a dynamic of its own, and it can continue to grow at a rapid pace for decades simply because of its size.” To prove his point, he selects members of the Forbes billionaires list to show that wealth always grows faster than the average income earner. He repeatedly refers to the growing fortunes of Bill Gates in the United States and Liliane Bettencourt, heiress of L’Oreal, the cosmetics firm.

Come again?

I guess he hasn’t heard of the dozens of wealthy people who lost their fortunes, like the Vanderbilts, or to use a recent example, Eike Batista, the Brazilian businessman who just two years ago was the 7th wealthiest man in the world, worth $30 billion, and now is almost bankrupt.

Piketty conveniently ignores the fact that most high-performing mutual funds eventually stop beating the market and even underperform. Take a look at the Forbes “Honor Roll” of outstanding mutual funds. Today’s list is almost entirely different from the list of 15 or 20 years ago. In our business we call it “reversion to the mean,” and it happens all the time.

Prof. Piketty seems to have forgotten a major theme of Marx and later Joseph Schumpeter, that capitalism is a dynamic model of creative destruction. Today’s winners are often tomorrow’s losers.

IBM used to dominate the computer business; now Apple does. Citibank used to be the country’s largest bank. Now it’s Chase. Sears Roebuck used to be the largest retail store. Now it’s Wal-Mart. GM used to be the biggest car manufacturer. Now it’s Toyota. And the Rockefellers used to be the wealthiest family. Now it’s the Waltons, who a generation ago were dirt poor.

Piketty is no communist and is certainly not as radical as Marx in his predictions or policy recommendations. Many call him “Marx Lite.” He doesn’t advocate abolishing money and the traditional family, confiscating all private property, or nationalizing all the industries. But he’s plenty radical in his soak-the-rich schemes: a punitive 80% tax on incomes above $500,000 or so, and a progressive global tax on capital with an annual levy between 0.1% and 10% on the greatest fortunes.

There are three major drawbacks to Piketty’s proposed tax on wealth or capital.

First, it violates the most fundamental principle of taxation, the benefit principle. Also known as the accountability or “user pay” principle, taxation is justified as a payment for benefits or services rendered. The basic idea is that if you buy a good or use a service, you should pay for it. This approach encourages efficiency and accountability. In the case of taxes, if you benefit from a government service (police, infrastructure, utilities, defense, etc.), you should pay for it. The more you benefit, the more you pay. In general, most economists agree that wealthier people and big businesses benefit more from government services (protection of their property) and should therefore pay more. A flat personal or corporate income tax would fit the bill. But a tax on capital (or even a progressive income tax) is not necessarily connected to benefits from government services — it’s just a way to forcibly redistribute funds from rich to poor and in that sense is an example of legal theft and tyranny of the majority.

Second, a wealth tax destroys a fundamental sacred right of mankind — financial privacy and the right to be left alone. An income tax is bad enough. But a wealth tax is worse. It requires every citizen to list all their assets, which means no secret stash of gold and silver coins, diamonds, art work, or bearer bonds. Suddenly financial privacy as guaranteed by the Fourth Amendment becomes illegal and an underground black market activity.

Third, a wealth tax is a tax on capital, the key to economic growth. The worst crime of Piketty’s vulgar capitalism is his failure to understand the positive role of capital in advancing the standard of living in all the world.

To create new products and services and raise economic performance, a nation needs capital, lots of it. Contrary to Piketty’s claim, it’s good that capital grows faster than income, because that means people are increasing their savings rate. The only time capital declines is during war and depression, when capital is destroyed.

He blames the increase in inequality to low growth rates, when, says, the economic growth rate falls below the return on capital. The solution isn’t to tax capital, but to increase economic growth via tax cuts, deregulation, better training and education and productivity, and free trade.

Even Keynes understood the value of capital investment, and the need to keep it growing. In his Economic Consequences of the Peace, Keynes compared capital to a cake that should never be eaten. “The virtue of the cake was that it was never to be consumed, neither by you nor by your children after you.”

What country has advanced the most since World War II? Hong Kong, which has no tax on interest, dividends, or capital.

 

If the capital “cake” is the source of economic growth and a higher standard of living, we want to do everything we can to encourage capital accumulation. Make the cake bigger and there will be plenty to go around for everyone. This is why increasing corporate profits is good — it means more money to pay workers. Studies show that companies with higher profit margins tend to pay their workers more. Remember the Henry Ford $5 a day story of 1914?

If anything, we should reduce taxes on capital gains, interest, and dividends, and encourage people to save more and thus increase the pool of available capital and entrepreneurial activity. A progressive tax on high-income earners is a tax on capital. An inheritance tax is a tax on capital. A tax on interest, dividends, and capital gains is a tax on capital. By overtaxing capital, estates, and the income of our wealthiest people, including heirs to fortunes, we are selling our country and our nation short. There’s no telling how high our standard of living could be if we adopted a low-tax policy. What country has advanced the most since World War II? Hong Kong, which has no tax on interest, dividends, or capital.

Hopefully Mr. Piketty will see the error of his ways and write a sequel called “The Wealth of Nations for the 21st Century,” and will quote Adam Smith instead of Karl Marx. The great Scottish economist Adam Smith once said, “Little else is required to carry a state from the lowest barbarism to the highest degree of opulence but peace, easy taxes, and a tolerable administration of justice.” Or per haps he will quote this passage: “To prohibit a great people….from making all that they can of every part of their own produce, or from employing their stock and industry in the way that they judge most advantageous to themselves, is a manifest violation of the most sacred rights of mankind.”


Editor's Note: Review of "Capital in the Twenty-First Century," by Thomas Piketty, translated by Arthur Goldhammer. Belknap Press, 2014.



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They Didn’t Want a War

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Margaret MacMillan’s The War that Ended Peace gives a fascinating description of the background, stretching back to around 1900, of what she, like people at the time, calls the “Great War.” She relates how the Bosnian crisis of 1908, the Moroccan crises of 1905 and 1911, the crises arising from wars among the Balkan countries in 1912 and 1913, and various minor incidents were successfully muddled through without war among the great powers. The most general source of tension seems to have been fear of being attacked first and concern to make and maintain alliances.

Leading statesmen optimistically expected that tension between Austria-Hungary and Serbia, exacerbated by the assassination of Archduke Franz Ferdinand on 28 June 1914, would somehow be resolved like the earlier crises. Even after Austria-Hungary rejected Serbia’s compliant but not total acceptance of its ultimatum and declared war, hope lingered of keeping the war contained.

Few policymakers had wanted war (the main exception perhaps being Franz Conrad von Hötzendorf, Austro-Hungarian Chief of Staff). The German Kaiser was no exception, although he was addicted to impulsive speeches and interviews, liked to strut in military uniform, and even enjoyed fiddling with the detailed design of uniforms (as did his fellow emperors Franz Joseph and Nicholas II).

World War I was a momentous and enduring tragedy. Germany, for one, had everything to gain from continuing peace.

As those examples suggest, MacMillan goes into revealing detail not only about demographic, economic, political, diplomatic, and military situations and events but also about people — royalty, politicians, foreign ministers, diplomats, generals and admirals, journalists, and influential or well connected socialites — together with their backgrounds, illnesses, deaths, and strengths or quirks of personality.

Much of this is relevant to the role of sheer and even trivial accident in momentous history. MacMillan herself notes several examples. The Russian monk Rasputin, whatever his faults, strongly advocated peace and had great influence with the Imperial family; but he had been stabbed by a madwoman on the very day of the Austrian Archduke’s assassination and was recovering slowly, far from St. Petersburg. The Archduke himself had long realized that Austria-Hungary was too weak to risk an aggressive foreign policy. Alfred von Kiderlen-Wächter, German Foreign Minister and in MacMillan’s opinion a force for peace, had died in December 1912. Joseph Caillaux, France’s peace-minded Prime Minister, had had to resign in January 1912, partly in connection with his second wife’s shooting of an editor who had threatened to publish some indiscreet love letters that Caillaux had sent to her while she was still married to someone else. Although MacMillan does not explicitly raise the question, I was set to wondering how events would have evolved if Otto von Bismarck, a realist who was satisfied with Germany’s international position achieved by 1871, had been alive and in office in 1914. Or what if Gavrilo Princip’s bullet had missed the Archduke?

MacMillan ends her book, apart from a 13-page epilogue, with the outbreak of war in July-August 1914. That is fine with a reader more interested in the consequences of particular wars and with how the wars might have been avoided (as many potential wars no doubt were barely avoided) than with the details of the actual fighting. World War I was a momentous and enduring tragedy. Germany, for one, had everything to gain from continuing peace, including its growing leadership in science and industry. MacMillan writes a gripping story. She conveys a feel of the suspense that must have prevailed during the final crisis. My opinion of her book is overwhelmingly favorable.

Or it would be except for one minor but pervasive and annoying defect. The book is erratically punctuated, mainly but not everywhere underpunctuated. Even independent clauses, often even ones with their own internal punctuation, go unseparated by a comma or semicolon. Restrictive and nonrestrictive phrases and clauses are not distinguished, as clarity requires, by absence or presence of punctuation. Such erratic and erroneous punctuation delays understanding, if usually only for a second. Even so, it distracted me from the book’s fascinating story.

Above all, it distracted me with sustained wonder about how so untypically mispunctuated a book could emerge from a major publishing house. Could the copyeditor have given up in the face of a daunting and tedious task? Could an incompetent editor have imposed the damage, which the author then passively left standing? Could the author have committed the errors herself and then, perhaps out of bad experience with previous copyeditors, have insisted on none of their tampering this time? None of these hypotheses seems plausible, but I can’t think of a better one. The author’s including her copyeditor in her long list of Acknowledgments adds to the mystery.

I’d be grateful if someone could relieve my curiosity with the true story.


Editor's Note: Review of "The War that Ended Peace," by Margaret MacMillan. Random House, 2013, 784 pages.



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