The Buck Rogers Test

Here’s a thought experiment I instinctively apply when evaluating this or that public policy: If I were revived after being frozen 500 years, and the policy were still in place, how would I feel?

Call it the “Buck Rogers” test.

I don’t know about you, but if I woke up 500 years from now and discovered that “affirmative action” still existed, I’d want to freaking strangle somebody. If we still had to have ‘welfare’ in any recognizable form, I’d be pretty sad. On the flip side, if there were still a military maintained with taxation I’d be like ‘well of course’. If there were still public education of some sort (not necessarily its current form) I’d be nonplussed.

On more specific items: if I heard there were still something called the “Department of Housing And Urban Development”, I’d launch into a deep existential depression. I’d have a similar reaction to learning any of the following about 2491 America from Erin Gray upon being unfrozen: the government still regulates the size of toilet-flushes; the government still has farm subsidies; the government still taxes income by garnishing peoples’ paychecks and then once a year forcing them to do a giant intrusive questionnaire/calculation based on arcane/labyrinthine rules; the government still launders a 30-year-fixed mortgage subsidy through Fannie and Freddie; the government still dictates how many miles-per-gallon-of-gasoline land vehicles must get; the government still hands out food stamps; the government still cites and imprisons people for transferring cannabis to one another.

Whatever you may think of these policies and/or programs now, you must admit that it would be depressing as hell to learn they’ll still be in place 500 years from now. And if you don’t think so: honestly, there’s something deeply wrong with you. One of the strengths of the Buck Rogers test is that it forces one to think long-term about the policies they favor. Is it a short-term fix, just “for now” (and if so, when/under what circumstances can it end??), or is it something you’d be comfortable embedding into society permanently? Many of the above policies may have justifications now, but as permanent embedded features of society, even many of their supporters would have to agree they just stink.

But another, related, strength is that it forces one to be honest with oneself about the arguments they use for policies. For example, if you claim affirmative action is “still needed” because “we’re not there yet”, you either must admit that (a) it can and should go away eventually, or (b) you’re being a damn phony with that argument.

Staying with affirmative action, assuming the answer is (a), this naturally raises the question: Well, when can we get rid of it? The pro-AA answer is, essentially, “I dunno, but certainly not yet!!”. Ok fair enough, but when? Most AA supporters do not appear to have thought that far in advance. But they should, and the Buck Rogers test forces them to. Regardless of how much one favors AA, are its supporters willing to declare that it can and should still be around 500 years from now? To say “yes” is to essentially admit that one doesn’t even believe AA can or will achieve its supposed goal (racial equality), but to say “no” is to admit that the policy should sunset. In either case the anti-AA are far more comfortable putting their position to the Buck Rogers test than are the pro-AA.

There was a brief shining moment during the debates over the Iraq war when the left appeared to grasp the power of this sort of argument. That is, for a while at least, the Left became quite fond of asking for ‘metrics’, for tangible ‘benchmarks’, against which one could measure the progress of the Iraq occupation and thereby declare victory. This was all well and good, the only problem being the Left has never shown a propensity to apply this principle to any other aspect of public policy, before or since. What pray tell are the ‘metrics’ for affirmative action, for welfare, for progressive taxation by which one could declare the equivalent of ‘victory’ and stop agitating for their increase?

Of course, there are none. The Left’s infatuation with ‘metrics’ was short-lived and highly specific.

It should come as no surprise that most if not all of my policy preferences pass the Buck Rogers test. On most issues you can name, my position is one I’d be perfectly comfortable and happy to learn is still in place in 2491.

What about you?

What about the “progressive” left? How much of the “progress” so passionately favored by “progressives” really survives the Buck Rogers thought experiment? This really gets back to the idea of progress most aptly stated by Ronald Reagan, in a quote I’ve always heard and dug up (and didn’t find anyone claiming was bogus):

Welfare’s purpose should be to eliminate, as far as possible, the need for its own existence.

That, to me, would be progress. So how do “progressives” measure progress, I wonder?

The Truth About The Oil Leak

As we grapple with the most perplexing and frustrating news of our time, the failure of all efforts to stop the oil leak in the Gulf, I think it’s important to service truth and apprehend the causes and effects in play here accurately and honestly. Sometimes the truth hurts but this is the only way we as a nation can not only progress past this crisis but, hopefully, learn and grow from it.

It is to this end and only with the highest and noblest motives in mind that I, in direct language that may appear blunt (but which I think we all need to hear), have decided to come out and state the unspoken but obvious truth where other, lesser commentators and pundits are afraid to:

The Gulf of Mexico is racist.

My Favorite President Obama Speech

My favorite President Obama speech was the one where he pointed out that, although the problem under consideration was challenging, and there was no quick fix, Obama was trying the best that he could, and the most important thing we must all keep in mind was that the problem didn’t begin with him, it began with his predecessor, Obama only inherited it.

Remember that one? That particular speech was awesome.

Katrina Was Not “Katrina”

The oil spill is now being called, at least in some quarters, “Obama’s Katrina”, so let me take this rare tantalizing opportunity to ostentatiously parade my consistency and evenhandedness by declaring that oil spilling a mile deep in the ocean somewhere – like a tornado hitting a city on a gulf – is not the fault of the President of the United States, and is not really the President of the United States’s responsibility to “fix”. Sometimes bad, unfortunate things happen, and perfect solutions do not exist, no matter how Smart you are, and you just have to wait, and see, and (yes) hope.

All else equal would it be good for President Obama to coordinate/bring about some sort of solution, fix, cap, stop to the oil gushing out from underneath the ocean (albeit not necessarily in the fashion Steve Sailer suggests, with I think appropriate sarcasm)? And would it have been good for President Bush to have figured out a way, when local government failed to and many of the people themselves declined to, to evacuate residents from New Orleans sooner? Sure, I suppose. For that matter, it would have been good if I or you had done such a thing. Any help in a crisis and all that. But in neither case is solving these things the job of the President of the United States per se, not in any real sense. And so in neither case does the fact that these things did not occur constitute genuine criticism of the President of the United States.

Criticizing Presidents for failing to “solve” natural disasters and crises of this magnitude and complexity simply perpetuates the unfortunate and frankly puerile hero-worship mythology that has risen around Presidents, that they are somehow super-intelligent superhumans (or, that they are supposed to be, anyway) that we charge with Solving All Possible Problems Under The Sun. This is unhealthy and unhelpful and I have no desire to participate in the ongoing construction and nurturing of this myth. Barack Obama, like George W. Bush before him, is a dude sitting in an office in Washington, DC, a rather flat drab place up on the East Coast. He has a staff of some busy-beaver people who live nearby. As far as I can tell they walk around corridors and sit on cushioned chairs and work on laptops and talk on cell phones all day long. Yes, I’m sure they are all bright and above-average intelligent and work very hard. However, I hate to break it to those of you out there who think that law degrees and other fancy pieces of paper, and expensive ties & pant-suits, endow their holders with omnipotence and infinite powers of leadership/string-pulling, but there is very little tangible that he or they can feasibly do to stop oil from gushing from a hole 5000 feet under the ocean, other than to urge and harangue folks who do do and know about such things to find a fix – and then hope that they do. As far as I can tell, that is exactly what President Obama (like me, and like you) is doing. I know not what else he can be expected to do, and if you don’t either, which you probably don’t, not really, then to criticize him in this way is misplaced.

There are plenty of other things to criticize him over. Plenty. “Obama’s Katrina”? Please. Katrina was not “Katrina”. Shit happens. There is no Superman. Grow up.

Laws For Thee Not For Me

What follows are hopefully the only words I’m going to have to write on the thing about someone named Sestak being offered a job (or something) by Obama in exchange for (something). You see, I haven’t bothered to look into what the details are or what actual law may have been broken. This is because: although a law may have been broken, the one who it is suggested may have done so is President Obama, and he is Smart, and has a (D) after his name, so (even if he did break a law) that automatically makes it okay, and thus it would be a waste of time/energy on everyone’s part to think/do anything about.

So I shan’t.

Links

With minimal commentary for your added pleasure.

• The scientific case for doing nothing.
• Evil rubble-clearers, stealing Haitian jobs.
• Why doesn’t Greece just default?
• Well, Thailand wouldn’t be the first country, nor the last, to be screwed up by its class of educated soft-liberal democrats….
• Better regulation doesn’t actually strengthen banks. That doesn’t compute; doesn’t ‘regulation’ automatically work? (Obligatory Arnold Kling link)
• This lunatic thinks there’s such a thing as a problem that the government shouldn’t try to solve. Absurd!
• Is the nuclear family an Anglo-Saxon thang? And if so, does it breed both thriving capitalism and intergenerational debt?
• Does prenatal ultrasound cause autism?
• Liberalism is a form of middle class secular messianism.

Hitting Them Where It Hurts

Wow – the ISDA chairman comes out swinging:

Naked-Swap Ban Is Misinformed Assault on Markets

Ballsy. If there’s one thing we know politicians and regulators (and folks who cheer them on) don’t like being called, it’s misinformed (or equivalent). That’s because politicians and high-level government bureaucrats, and the lay people who like to cheer on the power grabs of the former, are very fond of their self-images as Smart People.

The Chairman of ISDA just basically called them ignorant and said they don’t know what they’re doing. He’s 100% correct of course, but that is NOT going to sit well with the egomaniacs we call our leaders and representatives. Don’t be surprised if some sort of scandal comes out surrounding this guy. Coincidentally, of course.

So The World May Know How Obsessed I’ve Been With Lost All These Number Of Years That That Show Has Been On Whatever Channel It’s On

In honor of its spectacular series finale episode, I have compiled some differences between Lost and Gilligan’s Island:

• I’ve actually watched more than a single second of Gilligan’s Island.

Well, that’s about all I can think of.

I was going to add that Gilligan’s Island had Ginger on it and Lost didn’t, but technically I guess I don’t actually know that.

Another bullet-point I suppose I could get away with adding is that it took me maybe 2-3 years before I figured out (by reading what others wrote about it) that, contrary to what I had been assuming the whole time, Lost wasn’t a Reality Show ™ like Survivor. With Gilligan’s Island, it didn’t take me even 2/3 that long.

The one true fact I do know about Lost is that it has something called the Lost Numbers on it. This (like all things involving numbers) piqued my interest (though not enough to ever actually watch the show, ironically). And here are the Lost Numbers: 4, 8, 15, 16, 23, 42. These are totally meaningful and not something the TV creators just made up on the fly while high one afternoon, which is why I’ve spent hundreds of hours of my life thinking about them and their possible meanings. Because if there’s one thing I’m confident TV creators of a hastily-thrown-together mid-season replacement show know a lot about, it’s how to pick a metaphysically meaningful sequence of numbers that will have some sort of deep scientific and/or symbolic significance, and to weave them into the plot of a story lasting years.

I am happy to say I can now reveal my findings to the world and summarize what the Lost Numbers mean in two words: Diddly squat.

But the best Lost theory of all, which I just made up (MUST CREDIT RHYMES WITH CARS AND GIRLS!): the entire plot of Lost, whatever the hell it was, was all a dream, a dream of Lacey Chabert (the little sister from Party Of Five) in which her older brother gets a haircut and then trapped on some island (in that order). To me, this is the only explanation that will ever make sense.

To follow: My thoughts on the exciting series finale of 24. As a preview, let me just note that my very favorite 24 episode of them all was still the one where Jack Bauer had to use violence or the threat of violence on a person in order to extract information from that person. That particular episode was AWESOME.

All Politics Are Tribal

My cynical theory of political leanings is that most people’s views – whatever they say – can be explained by what they think will make them honored, empowered and/or prosperous. In other words, contra the left’s cherished ‘what’s the matter with Kansas’ theory, people do too vote based on self-interest – even when they may not appear to. It’s just that you have to correctly identify the self-serving ends that guide peoples’ votes (hint to the supposedly anti-materialist left: money is not the only possible self-serving end).

The flip side of this theory is that when faced with someone’s political views, and arguments for those views, it’s a waste of time to take them at face value let alone try to argue with them. Instead, you’ll understand the situation better simply by trying to look for how the person’s political aims would benefit him (where again, ‘benefit’ needs to be more broadly defined than ‘gets money’) if broadly implemented. My theory, in short, says that you’ll always find some way in which a person’s politics point towards a system in which that person, or at least people like him, are celebrated, empowered, prosperous and/or comfortable.

In a way this is just the (not exactly original, cf. Robin Hanson) theory that all politics are tribal, where ‘tribes’ are broadly defined. Sure, the group of people (say) ‘African-Americans’ is a tribe. But also, the group of people ‘unionized workers’ is a tribe. The group of people ‘public schoolteachers’ is a tribe. The group of people ‘homosexuals’ is a tribe.

The group of people ‘intellectual elites’ is a tribe. They behave as a tribe and vote as a tribe.

A corollary is that if you look at a person’s political views, you’ll see right away which tribe(s) they think they belong to, because those will be the tribe(s) their political views tend to elevate.

Matthew Yglesias evidently thinks he’s part of the intellectual elite. Rush Limbaugh evidently does not. They may in fact both be right, but the point is, this self-identification alone – not rational arguments – explains virtually all their political views. Under the sort of system favored by the sort of left-wingers that Matthew Yglesias favors, Matthew Yglesias is confident that Matthew Yglesias would be an important and well-compensated person. Rush Limbaugh, not so much.

Before you protest at my (admitted) cynicism, at least acknowledge that most people already think in my terms about at least some political factions. Who for example doesn’t think in terms of “the black vote” and confidently expect “the black vote” to vote for whoever promises to give more handouts to blacks (or a proxy group for blacks), or even just for whoever seems likely to have more black appointees/confidants at his side, or who will tend to flatter blacks more often, or (of course) whoever is himself black? In this context what exactly is the argument for why blacks are all always supposed to vote for (D)’s? It’s no more and no less than the assertion that (D)’s are ‘better for blacks’, is it not? If this faction weren’t deemed so tribal and self-serving (by everyone, especially by those on the left), this argument would fall flat. If tribalism weren’t the expected norm of behavior, then wouldn’t blacks be expected to just vote for whoever’s ‘best for the country’, like everyone else?

So all I’m really saying then that may be controversial is that ‘tribalism’ exists on planes other than mere race. People seem to be able to form tribal links out of just about anything – ‘saving the Earth’-ism, ‘taxes must always be raised on other people’-ism, etc.

Actually, humans seem to need tribes in their lives, which may explain why America – the atomized, antitribal country for a long time dominated by tribeless WASPs – has so readily formed so many new, synthetic tribes. Just as without religion people will come to believe anything, however wacky, it seems that people without a traditional tribe in their lives will cling to the most shallow and tenuous of associations as their ‘tribe’, and if only out of convenience will hitch their wagon to political views meant to elevate that ‘tribe’ above others.

When I see an SNL skit aimed against Sarah Palin, I can’t help but get the feeling I’m watching tribal behavior (certainly not rational discourse). The people who laugh at those skits and think they’re hilarious aren’t engaging in political discussion of or rebuttal against the merits/demerits of Sarah Palin (and, most likely, never have). They are simply making fun of a tribe they hate (Palin, and people like her), and trying to keep it down, and ensure that it does not rise to a position of honor. On the flip side, people who like Sarah Palin sense this attack on them and their tribe, and instinctively fall into a defensive position, rooting for Palin to kick some ass, to score one for their tribe, circling the wagons around her, flaws and all.

For another example, watch this (highly entertaining) political ad and tell me that its power and resonance doesn’t trace mostly to tribal cues, rather than rational argument:

The point is that it doesn’t really matter to my observation above that the ‘tribes’ who have come into conflict over Sarah Palin, or “Alabama”, might be as shallow and silly as ‘cool kids who listened to alternative music, went to a preppy East Coast university, and now are foodies’ on the one hand vs. ‘people who have hunted, like the WWF, and had three kids by age 23′ on the other. Sure, it may not seem like such associations form a solid foundation for a tribe.

But that doesn’t prevent tribal behavior on either side’s part, evidently.

When Politicians Have A Scary, Dangerous View On What To Do In A Hypothetical Situation That Is Never Going To Occur

How fundamentally strange is it that, every so often, we seem to ritually burn a right-of-center politician at the stake via the tried-and-true method of entrapping him into saying something politically incorrect in response to an entirely counterfactual hypothetical.

Of course I’m talking about Rand Paul and his recent statements about the 1964 Civil Rights Act, in particular whether businesses ought to be allowed to discriminate.

Leaving aside his response and what the ‘correct’ answer is, let me just ask: what on earth does this have to do with reality? Which businesses exactly do people think want to discriminate, and why? Is this a real issue? Is there a serious proposal out there to ‘let business discriminate’, or to repeal the Civil Rights Act?

Do people think businesses are chomping at the bit to turn away blocs of customers en masse?

To hear people talk, if the Civil Rights Act weren’t in place, then your local Subway and Starbuck’s would be no-blacks-allowed. Why would these businesses do this? What incentive would they have? And even if they did, wouldn’t they just become uncool and shunned by right-thinking people everywhere?

I think scorn, derision, and critique are highly underrated weapons in the fight against such things.

Maybe the Civil Rights Act was pragmatically necessary for that time and place and maybe not, but surely, today, this discussion has no basis whatsoever in any actual thing that is actually going to happen or not happen. Indeed I dare say the Civil Rights Act could be repealed in toto at this point and the tangible effect on Americans’ lives would be pretty much nil. This brouhaha is a tiresome game of “gotcha” played by left-of-center media drones, and (as usual) a right-of-center politician stupidly took the bait.

I Wonder What All The “Antiwar” People Are Doing Today

Remember how in 2004-2008 a large proportion of our country absolutely FREAKED OUT about the fact that the United States had some soldiers stationed in a country called Iraq? This was the “antiwar” movement. They didn’t want U.S. soldiers to be stationed in Iraq (which as everyone knows is called “a war on Iraq”) therefore they freaked out, and protested, and made lots of self-righteous noise, insisting that we listen to them. And we did, through our mainstream media which made sure we had no other option.

Well as you know they succeeded because we no longer have any soldiers stationed in Iraq!

I mean, I assume we don’t. Because the “antiwar” movement suddenly became silent around late 2008 and we have not heard from them since. This is presumably because the “antiwar” movement achieved their goals, thus was dispensed of their civic responsibility to FREAK OUT and make a lot of whines and noise, and instead could merge back into regular society, content in their mission accomplished.

Hmm…wait a minute….I just checked icasualties.org….149 US fatalities in Iraq in 2009…27 so far in 2010…how can this be?

Okay, so we didn’t remove our military contingent from Iraq. Where then are all the “antiwar” people? Isn’t it still their civic duty to have naked protests and post ‘I’m sorry’ websites and such? Why not? Is it no longer a “war”? Why not? Is it no longer urgent to FREAK OUT about it? Why not?

Oh I see, the answer is, ‘because it’s gotten less deadly’. (Why is that, I wonder? Because of the protestors’ valiant efforts which totally accomplished such a large amount of accomplishment, or could it be rather because of “The Surge”(tm) that they protested against so much?)

So, but okay, no, I get it. Now that the deadliness has been cut down, it’s below the protest-worthy threshold, so it’s no longer important to protest against like it was in 2008. In 2008 (when the protests were still going on), there were 314 US fatalities in Iraq. Evidently this was above the protest-worthy threshold. Which they are totally consistent about (Afghanistan: 316 US fatalities in 2009: more deadly than FREAKOUT-WORTHY 2008 Iraq).

Now look, I admit it, pointing out stuff like ‘inconsistency’ on this front is pretty boring I guess. I mean, it’s almost too obvious: the “anti-war” faction did indeed stop protesting because they achieved their goal.

Their goal was, purely and simply and solely, to get someone with (D) after his name into the Presidency.

Mission accomplished.

Movies Need More Grownups

You know how from time to time someone in a movie/TV show will tell someone else (who, the audience needs to be made aware, is supposed to be really tired cuz they were up all night working on the murder case, or whatever) “you look terrible” or “exhausted”? They never really do. That bothers me. I know what “terrible” looks like and that ain’t it. You’d think that between all the makeup and the method acting and the CGI they could cobble together a more convincing portrayal of “terrible”. It’s as if filmmakers are afraid to let their actors ever look truly unpretty, and they know they’re doing it, so they emphasize via stilted dialogue how “terrible” someone supposedly looks when the script actually calls for it.

A larger but related point: I think one of the reasons movie sequels and series get worse as they drag on is that filmmakers are more puerile yet more out of touch, so they think they need to stuff their movies with pretty smooth-faced kids and teenagers in order for kids and teenagers to like them. Take the original Superman (to me the Christopher Reeve/Margot Kidder version will always be the “original”, sorry). Now granted, Superman is a totally juvenile story. Yet in that movie at least Superman/Clark Kent is recognizably a grownup and so is Lois Lane. Yet miraculously, kids loved it. I know, because I was one. And it’s still great! You see, contrary to what today’s filmmakers thought, kids didn’t literally need kids to be the actual main characters of the story in order to relate to it. Kids don’t look up to kids, they look up to grownups. That’s because they want to be grownups, not other kids.

But in the recent sequel, Superman is (as far as I can tell) a homosexual teenage Ambercrombie & Fitch (sp?) underwear model, and Lois Lane is that actress from Dawson’s Creek (or whatever, she’s probably not literally an actress from Dawson’s Creek, but aw c’mon, you know what I mean…all these actresses look basically the same now). The point is that both characters, supposedly after a 5 year journey, seemed to get observably younger. Neither appears to be a grownup, let alone 5 years older. And I didn’t care diddly squat about either one. (Especially the fake Lois. Come back to us, Margot Kidder!) And it’s all because the filmmaker is, basically, not a grownup, yet paradoxically, doesn’t understand how actual kids think. Or maybe he was just scared – like everyone nowadays – to make a movie in which not everyone was airbrush-pretty.

There’s an illuminating exception that proves the rule in the 1978 version which is the character of Jimmy Olsen. That character indeed was supposed to be a young guy. But notice, young as he was, he was still a grownup moving around in a world of grownups. Compare Jimmy Olsen in Superman to Peter Parker in Spider-Man: both are young guys, both characters are at basically the same stage of their lives, both are photographers for newspapers. Yet Jimmy Olsen seems years older and wiser than Peter, who no matter what happens seems basically 15 years old. This despite the fact that from what I can tell, Tobey Maguire was like 27 when playing Peter Parker, which is 7-8 years older than was the dude who played Jimmy Olsen in 1978. (Maybe actors, or just people in general, are getting more puerile…)

Movies – especially comic-book adaptations that are already fundamentally juvenile – just need to have more grownups. And it’s hard to think of a movie series that hasn’t been spoiled in this way. Indiana Jones 4, they plopped Shia Le’bouf (sp?) into the thing for no apparent reason. The Star Wars prequels, were full of kids/teenagers running around. The supposed love interest from Spider-Man was whatshername the 10-year-old actress from that vampire movie. The ’90s Batman movies threw Chris O’Donnell in the mix (I think they knew that was a mistake luckily), and even the highly praised Christian Bale Batmans have totally juvenile love interests no one can possibly care about. She is literally from Dawson’s Creek, in the first one, and then (as played by Donnie Darko’s sister) gets killed off in the even-more-critical-darling second one, and still no one cares.

Why do filmmakers keep doing this? Why are all characters who should be thirtysomething played by 22-year-olds. It can’t be a coincidence. And neither can the fact that basically all of these sequels/series just make me yawn (and long for Margot Kidder).

I just watched a great movie from 1978 called The Silent Partner, with Elliott Gould as a clever/scheming bank teller and Christopher Plummer his bad-guy robber nemesis. It’s so bizarre to think that Elliott Gould, of all people, was a big star, dare I say sex symbol?, in the 1970s. Was it the frizzy, curly hair? The big nose and long, lined horse-face? The thick bushy eyebrows? (Characters in the movie kept telling the Gould character how ‘photogenic’ he looked on TV, too! Hilarious!) And Gould’s sexy love interest, played by Susannah York (Superman’s mother!), was like 39 years old at the time, as far as I can tell – a nice-enough looking woman at that point, whom several characters in the movie kept lusting after/saying how good-looking she was – but really, just not a young girl. Lines on her face and everything!

Just think how inconceivable that would be today; if The Silent Partner were remade, it would have Zac Efron as the worldly-wise teller, Ashton Kutcher as the menacing bad-guy, and Amanda Bynes as the burned-out but full-of-life love-interest. Because it’s all about demographics, y’see?

24 Season 8

This season of 24 has gone a little crazy (or should I say even crazier), and as far as I can tell they are setting Jack Bauer up to become a bad-guy – they’re having him do a turn from a face to a heel, if you will – which is why it’s interesting to step back and look at the backdrop of how all these events were set in motion this time: a U.S. President obsessed with getting a “Peace Agreement” signed.

The President on 24 is a woman who we are supposed to have come to respect in prior seasons (for reasons I don’t quite remember). Or you can just think of her as the nice but slightly nosy lady sheriff from Signs, as I do. Either way, the actress and the character brings with her a certain quotient of goodwill for the viewer. It may be due to this that the writers can get away with making her turn so despicable, stupid, and insane right under their noses, while keeping the focus on Bauer’s turn.

In fictional 24-land, where the year is probably 2013 or 2016 or something, there’s a place called the Islamic Republic of Kamistan. We are told there ‘hasn’t been peace there for over 50 years’. The President and her cronies are always giving each other self-congratulatory monologues about how they’re ‘trying to bring peace to a region that hasn’t seen peace for over 50 years’. To this end, we are given to understand that there’s a big UN meeting, with peace talks, and that the Russians are involved, and that it’s important that they be involved.

As the season has evolved, getting this piece of paper signed – by someone (it honestly doesn’t seem to matter much who) – comes to be a Holy Grail that gives license to the President and her hangers-on to do whatever the hell they want, in their minds. Most 24 viewers probably will view this season as one in which Jack Bauer turns bad. I think it’s primarily about a President turning bad. (Bauer was already halfway there and I’m still kinda-sorta on his side…)

But it’s how and why she turns bad that is the fascinating part. In prior seasons 24 has had a tendency to make everything trace back to evil oil-men or Halliburton types; but this one turns bad and Machiavellian in pursuit of a ‘liberal’ goal – to bring ‘peace’.

It’s worth pausing to point out that this obsession of hers, and seemingly 95% of the U.S. Government on the show (which apparently has no actual U.S.-related policies to oversee or implement), no longer makes any sense even on its own terms. The method by which this ‘peace’ is supposedly going to be brought about in this faraway place is that Lady President, and another lady who was married to Kamistan’s President before he was assassinated like ten hours ago, are going to sit in a room and sign some pieces of paper with some dirty Russian pigs and then all have their photographs taken (it is somehow thematically fitting that at this point it’s two women who are going to sign this thing, and who believe that doing so will accomplish something). You see? Then there will be ‘peace’. If they don’t do that there won’t be, but if they do, there will! That’s how it works!, as every highschool kid learns in Model UN.

This is what the President is so obsessed with bringing about, and what is worth bringing about at all costs, right now, today, regardless of all the crazy wacked-out sh1t that’s been going on (to review: dirty-bomb threat against Manhattan, a foreign head of state kidnapped by U.S. mercenaries and assassinated by terrorists, various shootouts in various places dotted across the city). Because this President – like ‘liberals’ in the real world – has a near-magical faith in well-intentioned fancy pieces of paper signed by important people in high-profile settings. She actually can’t conceive of the piece of paper being signed not translating into ‘peace’. How could it not? It probably has the word ‘peace’ on it and everything.

It’s to this blinkered end that she has covered up the fact that Russians were behind the assassination of Kamistan’s President, and it’s to this end that she blackmailed the Russians into participating in the peace agreement. The premise is that the act of signing the piece of paper, by itself, is so important and reality-altering that it’s worth all manner of unlimited duplicity and scheming to get the thing signed. This is impossible, of course, to square with the notion that the region has been beset with lengthy, intractable, warfare. In these ladies’ minds, the supposedly intractable warfare will suddenly become tractable – nay, cease – once the piece of paper is signed, and even regardless of the circumstances under which it’s signed. (That’s how it works! Warfare will just have to stop if there’s an Agreement, signed under whatever conditions of duress, mendacity and trickery.)

It’s also worth noting, if only because it is part and parcel of this magical/schoolage mindset, that just why the Russian participation is so important – indeed, why the Russians are even involved in the first place – is never explained. We are given hints that Russia has economic interests in the country that motivate their opposition to the agreement, but so what? Actually, why the U.S. is involved isn’t even explained. ‘Kamistan’ is presumably an ethnically Arab nation-state in the Middle East. Why does the U.S. care whether there’s unrest or ‘peace’ there. What makes the U.S. so supposedly well-positioned to broker such a ‘peace’. And even granting the premise that they do and are, why does Russia of all places have to ‘agree’ to a peace agreement there for it to take effect. What does Russia, a Slavic country far to the north, have to do with anything? It’s all just supposed to go without saying. And the reason it goes without saying is that the mindset here is magical, rooted in a schoolchild’s understanding of geopolitics. Russia is a big important country so of course they’d have to ‘agree’ to a peace agreement signed between the U.S. and some other country. And as for why the U.S. President is involved and doing all this stuff, well this is an Important World Issue so of course she would waste spend her time on it. That’s what Important, Smart people do when in power.

And so, because of this obsession with a ‘liberal’ end, the President on 24 veers into deceit and authoritarianism. This is a story arc so unusual in mainstream media that one almost suspects it has to be a mistake, an inadvertent slip on the part of the writers. Or I guess it’s possible that the writers do buy into the basic assumptions about geopolitics they’ve woven into the drama (you need the Russians on board for any/all ‘peace agreements’, peace agreements automatically work if signed, etc) that they don’t think they’re illustrating the craziness of those assumptions at all.

The Practical Meaning Of Troll

You may have encountered the internet term “troll”. I am sure it has an origin, and a theoretical meaning, and was a useful term at one point, and in some contexts perhaps still is. But here is what it usually means in practice:

troll (n.): In a comments thread dominated by insecure people who all share the same opinions but can’t make real arguments in favor of them, someone who posts a differing opinion. (Used in lieu of actual counterarguments.)

RIP DIO

Dio has rocked for a long, long time,
Now it’s time for him to pass the torch
He has songs of wildebeasts and angels,
He has soared on the wings of a demon.

Drugs Are Fun

With special guest Black Dynamite. Brought to you by Fight Smack In The Orphanage.

Link Cleanup

Just getting rid of recent links.

• Arnold Kling’s new theme, Insider-Outsider. Hey, where have I heard that sort of thing before?
• Golly, someone sure doesn’t like Bob Dylan.
• Self-explanatory: Peace settlements may do more harm than good.
• Good short letter on the arbitrariness of Basel risk measures. It’s awfully hard to explain to people used to thinking in slogans and one-liners that the cause of the Financial Crisis(tm/2007) traces to things like setting up arbitrary risk measures….

Everything’s A “Derivative”

A lot of commentary on “derivatives” seems strange to me because it is premised on the idea that there’s a hard and easy-to-draw line between what’s a “derivative” and what’s not. Supposedly, to folks who want to (even more highly) regulate if not ban “derivatives”, among financial instruments there are things that are okey-dokey and they are very, very easy to delineate from those dangerous, scary things that are “derivatives”.

I disagree. Maybe it’s just the mathematician in me, but I think virtually all financial arrangements and transactions – at least, all those which don’t literally involve you standing there face to face with someone, handing over actual cash, and receiving a good or service at that exact time – could be considered “derivatives”, it’s just that some are special cases that are simple enough that they confuse people into thinking they’re not “derivatives” when they are too.

What is a “derivative”? Wiki seems to call it “an agreement between two people or two parties – that has a value determined by the price of something else”. So, like, everyone agrees that a stock option is a derivative; its value depends on the price of something else (namely, the stock). Add FX options, volatility swaps, CDS, CDOs, etc., things which are obviously derivatives. But people seem to imagine the list ends here, with the scary stuff and the acronyms. Surely it doesn’t include normal stuff our grandpas looked at with their newspaper-stained fingers, like stocks.

But guess what? A stock is also a “derivative”, at least if you believe the Merton model in which a stock is said to be a call option on a company’s assets. At the very least, a stock’s value surely depends on things like a company’s assets and earnings – why else do people look at P/E ratios? But what are a company’s assets? Surely among them will, as well, be some “derivatives” (stuff that has a value determined by the price of something else). Like if the company has a 12-month contract with some other firm to be their exclusively sprocket supplier at a fixed price-per-sprocket – the value of that contract will surely depend on the price of sprockets (if their contract is struck at $10 per sprocket, but sprocket prices shoot up to $20 three months from now, suddenly that contract is not as valuable to them). Maybe they hedge that out using sprocket futures – more “derivatives”. And what is the price of sprockets anyway? Surely it depends on supply and demand; supply could depend on whether sprocket suppliers are in good health or bad, which depends on their assets (which could include “derivatives”); demand could depend on whether people have jobs, which could depend on other derivatives; or it could depend on the price of steel and other raw materials for the sprockets, which depends on steel futures (more derivatives!)….you get the point. Trying to chase each “derivative” to its supposedly pure, unrefined, free-range, organically-grown, non-derivative root can, sometimes, be a fool’s errand.

Derivatives are also often just convenient ways of splitting out and parsing and understanding the value of assets one would normally think of as straightforward, vanilla assets. A floating-rate bond can be thought of as, whether or not this is how it is constructed, a fixed-rate bond (nice, safe finance) plus an interest-rate swap (a DERIVATIVE). Or, for an example closer to home, do you have a mortgage? Just a simple, normal, 30-year-fixed mortgage? Well then you, my friend, are almost certainly involved in the nasty, high-stakes, high-finance game of DERIVATIVES. After all you almost certainly have purchased, as part of your mortgage contract, a difficult-to-value and completely non-vanilla DERIVATIVE called a (gasp) Prepay Option – that is, the option (but not the obligation) to prepay the principal of your mortgage early, whether by just paying down principal faster than scheduled on your own volition, refinancing (i.e. finding a new mortgage that will pay off this one), or selling the house (finding someone else to take out a mortgage that pays off yours). The value of this prepay option depends on, most prominently, the prevailing mortgage rate (which can depend on things like the prices of TBA agency mortgage bonds, which can depend on the price of a 10-year Treasury, or on whether the government is buying up mortgage bonds, or on the political winds, or all of the above…). If your fixed rate is 5% and current mortgage rates are 7%, then your Prepay Option is probably not a very valuable option, but if rates come down, its value can shoot way, way up (time to call Ditech?). On the flip side, you also (at least in most states) have an embedded Default Option – that is, the option to ‘walk away’ from your mortgage and hand your house over to the bank in its stead and let them try to sell it. The value of that option depends on home prices; if they sink below a certain level, and you start to owe more on your house than it’s worth, the Default Option starts to look really in-the-money to some people.

And you know what’s funny, far from being some esoteric financial gibberish that only sniveling French Goldman-Sachs-working spoiled-brat business-ecole a-holes understand, all homeowners understand these things quite well. Normal boring middle-class folks across the country know about the prepay option and its dependence on the mortgage rate, follow the prepay option’s implicit valuation regularly, and intuitively understand whether it’s in-the-money or not. Similarly, they (only too well, in the past three years) understand the Default Option, i.e. the concept of how much ‘equity’ they have in their house, and whether they are ‘under-water’ – concepts that can’t be reckoned other than as derivatives of home-prices. So let’s face it, if we’re being honest, a huge percentage of Americans play around in derivatives. They just might not think of it that way.

The classical way to understand a derivative is its payoff profile. These are just graphs designed to show how a derivative’s value (y) depends on the underlying’s price (x). Anyone who took Derivatives 101 got very used to understanding these little diagrams with bent lines or inverted triangles on them. So like here’s a picture of an equity call option payoff – its worth (y) is 0 if the stock price ends up being somewhere on the left (i.e. x is low), but has an increasing value to the right (if the stock lands higher than a certain level – the ‘strike’ – then the option has value, and the higher the stock price ends up, the more the option will end up being worth).

Similarly, here’s a possible payoff shape for the Prepay Option you homeowners all have, where x = current mortgage rates; if rates are low (x = to the left) then your option has value, and the lower rates are, the more valuable it is (i.e. the more you have to gain from refinancing), but if rates are above a certain point the option is worthless. (Note this option is also an American rather than European option, since it can be exercised at any time, so in a sense it’s even more complicated than a stock option):

So why do I say that everything’s a “derivative” then?  Well what about this payoff:

This payoff is just y=x, i.e., the value of something is the price of that thing.  This is just the payoff of a spot transaction, i.e. a transaction done then and there, for a price. If the price is 50 the value is 50, if the price is 100 the value is 100, and up and up.  This seems like a silly, roundabout way of saying something obvious, but the point I’m trying to illustrate is that this is (or at least, can be thought of as) just a special case of all those nasty, complicated, French-seeming things we call “derivatives”.  It’s not as if it’s a whole different animal after all.

Let’s say you go to Circuit City and see a large-screen TV you like.  They offer it at $500 and you think that’s ok so you buy it.  That’s a ‘normal’, safe, healthy transaction that doesn’t need Congressional oversight right?

Or is it a “derivative”?  After all, maybe we should think of what you’re really doing at Circuit City as entering into a forward contract at the strike price of $500 to have some guys in a truck deliver it to your house probably later that afternoon. So that’s a derivative!  Its value depends on the value and likelihood of that delivery.  What if there’s traffic, and the guys use more gas than expected – your side of the contract gained value, Circuit City lost. Or maybe you don’t have it delivered but they still have to get it from the stock room while you wait.  Maybe they take longer than expected to find it, using up your (valuable) time – your side of the contract lost value. These are all derivative considerations that affect the value of this seemingly simple, spot transaction.

On the flip side, notice the store’s side of the transaction:  they haven’t actually taken money from you, they just swiped your credit card and got your signature.  This effectively creates a supplemental agreement to existing contracts that they and you had with your credit-card company:  they now have a piece of paper (or electronic equivalent) from you with “$500″ written on it that (the credit-card company promises) they can deliver to your credit-card company and receive $500 cash in return – in other words they have a put.  That’s a derivative!  It has counterparty risk (what if the credit-card company declares bankruptcy?), legal risk (what if you dispute the transaction or decide to sue them or the card was stolen?) and a tiny bit of interest-rate risk (since they won’t actually get the $500 cash till a bit later…).  Your credit-card company, in turn, has a complicated hedge contract with you in which you promise to repay whatever they have paid out on your swipes, either right away or with interest, and with penalties that can kick in according to certain rules, etc.  The interest-rate on unpaid balances is probably fixed (and high, of course) so that’s interest-rate risk which they surely hedge with swaps.  The overall rules governing repayment are quite complicated and depend on lots of things.  And your credit-card company obviously has counterparty risk – you might go delinquent, or not pay at all.  So surely that’s a derivative too!

So you see?  Buy a TV at Circuit City and you’re a nasty, despicable derivatives trader.

Now my point is not that I really think it makes sense to call this transaction a “derivative”.  The simplest explanation is the best, and all. The above complicating factors aside, surely the payoff on such a transaction is still pretty much the straight diagonal line diagram above – if the TV costs $500, Circuit City’s end of the deal is pretty much worth $500 to them, more or less, and you’re pretty much out $500, more or less.  Sure.  It’s pretty much just a spot transaction.  But…well, not quite, is it?  There are complicating factors, it’s just that they don’t affect the valuation from that straight line all that much.  So while a pure spot transaction is executed right away, and has that straight-line payoff, many if not most real-world transactions are not pure spot transactions.  They’re DERIVATIVES.

It’s just that some derivatives are close enough to idealized, perfect spot transactions that the difference can be ignored. But this is a difference of degree, not kind. So if you really want Congress to ban or closely circumscribe all “derivatives”, you are either speaking very loosely or you’re talking about far more transactions than you realize. In the real world, the value of almost everything depends on the value of other stuff. This is because we are so interconnected, efficient, and wealthy, and is not a scary fact or one that can be wished away or regulated away at all. Or at least, it shouldn’t be.

Me & Yglesias

In one of those surreal bits of coincidence that seems to occur once in a blue moon, I totally and heartily agree 100% with everything Matthew Yglesias has to say on a particular subject, in this case, ratings agencies and the legal requirements for certain institutions to hold debt of a certain ‘rating’. Just go read the whole thing (here too), I have nothing to add.

Me & Yglesias. Not planning on getting used to the feeling by any means.

Our Whiny Ponzi Middle Class

Russ Roberts:

An unpleasant but unavoidable conclusion of this paper is that Wall Street was (and remains) a giant government-sanctioned Ponzi scheme.

Read the whole thing.

Earlier I stated that a lot of people who borrowed “bought” houses in the past ten years, far from having some sort of legitimate grievance now against Wall Street for ‘causing the crash’, are actually folks who benefitted undeservingly from the Ponzi scheme that Wall Street enabled. I don’t begrudge Americans who played this game and made out like bandits, but when the bubble bursts and everyone starts blaming Wall Street for the fact that their Ponzi scheme did not continue forever and allow them to live a highly-leveraged, cushy, McMansioned life on other suckers’ money indefinitely, and insist that I – who did not really play the game – be taxed more to make up the difference, well that’s when I start to get fucking angry. And you wouldn’t like me when I’m angry. (Hell, people barely like me when I’m happy….)

Suppose you bought into a Ponzi scheme this year, and got $100k back, and were able to support yourself this year on that amount. Not only that but you made a bunch of purchases and plans premised on the idea that $100k would keep flowing to you yearly from Ponzi schemes. But then the next year rolls around and the Ponzi scheme stops paying, and you’re unable to find a new one that pays that $100k.

Do you have a grievance against the Ponzi arrangers for ‘causing a crisis’? Do you have the right to be self-righteously angry with them for your financial hardships?

Hardly. You made out like a bandit. You got $100k passed to you from Ponzi suckers further down the chain. Among these suckers were IKB and ACA Capital, the investors in Abacus 2007-AC1, who handed over $1 billion for nothing. They were at the bottom of a giant pyramid. If you’re a homeowner who borrowed “bought” a nice house you couldn’t really afford, you were in the middle, not the bottom, of a Ponzi scheme. You have no grievance against anyone. If anything, people have a grievance against you.