Quibbles with Moldbug

To be a reactionary, minimally speaking, requires no more than a recognition that things are going to hell. As the source of decay is traced ever further back, and attributed to ever more deeply-rooted – and securely mainstream — sociopolitical assumptions, the reactionary attitude becomes increasingly extreme. If innovative elements are introduced into either the diagnosis or the proposed remedy, a neo-reactionary mentality is born.

As the United States, along with the world that it has built, careers into calamity, neo-reactionary extremism is embarrassingly close to becoming a vogue. If evidence is needed, consider the Vacate Movement, a rapidly growing dissident faction within the 0.0000001%. This is a development that would have been scarcely imaginable, were it not for the painstakingly crafted, yet rhetorically effervescent provocations of Mencius Moldbug.

From Moldbug, immoderate neo-reaction has learnt many essential and startling facts about the genealogy and tendency of history’s central affliction, newly baptized the Cathedral. It has been liberated from the mesmerism of ‘democratic universalism’ – or evangelical ultra-puritanism – and trained back towards honest (and thus forbidden) books. It has re-learnt class analysis, of unprecedented explanatory power. Much else could have been added, before arriving at our destination: the schematic outline for a ‘neocameral’ alternative to the manifestly perishing global political order. (On a trivial etiquette matter: Moldbug politely asks to be addressed as ‘Mencius’ — comparable requests by Plato Jiggabug and Siddhartha Moldbucket have been evaded too.)

Moldbug scrupulously distances his proposals from any hint of revolutionary agitation, or even the mildest varieties of civil disobedience. Neocameralism is not designed to antagonize, but rather to restore order to social bodies that have squandered it, by drafting a framework compatible with the long-lost art of effective government. (‘Long-lost’, that is, to the West – the Singapore example, among those of other city states and special economic zones, is never far removed.) Neocameralism would not overthrow anything, but rather arise amongst ruins. It is a solution awaiting the terminal configuration of a problem.

The neocameral program proceeds roughly as follows:

Phase-1: Constructively disciplined lamentation

Phase-2: Civilization collapses

Phase-3: Re-boot to a modernized form of absolute monarchy, in which citizens are comprehensively stripped of all historically-accumulated political rights

Despite its obvious attractions to partisans of liberty, this program is not without its dubious features, a few of which can be touched upon here whilst rehearsing the Moldbug case for Neocameral government in slightly greater detail. Stated succinctly and preliminarily, our reservations drift into focus when that guy on a white horse appears. Where exactly does he come from?

To answer ‘Carlyle’ would be easy, and not exactly inaccurate, but it would also miss the structural coherence of the issue. Moldbug refuses to call his neocameral dictator a ‘national CEO’ (which he is), preferring to describe him as a ‘monarch’ (which – as a non-dynastic executive appointee — he isn’t), for reasons both stylistic and substantial. Stylistically, royalism is a provocation, and a dramatization of reactionary allegiance. Substantially, it foregrounds the question of sovereignty.

Moldbug’s political philosophy is founded upon a revision to the conception of property, sufficient to support the assertion that sovereign power is properly understood as the owner of a country. It is only at this level of political organization that real property rights – i.e. protections – are sustained.

Property is any stable structure of monopoly control. You own something if you alone control it. Your control is stable if no one else will take it away from you. This control may be assured by your own powers of violence, or it may be delegated by a higher power. If the former, it is secondary property. If the latter, it is primary or sovereign property.

The sovereign power (sovereign corporation, or ‘sovcorp’), alone, is able to ensure its own property rights. Its might and rights are absolutely identical, and from this primary identity subordinate rights (to ‘secondary property’) cascade down through the social hierarchy. Neocameralism is nothing but the systematic, institutional recognition of this reality. (Whether it is, in fact, a ‘reality’ is a question we shall soon proceed to.)

Perhaps surprisingly, Moldbug’s conclusions can be presented in terms that recovering libertarians have found appealing:

Neocameralism is the idea that a sovereign state or primary corporation is not organizationally distinct from a secondary or private corporation. Thus we can achieve good management, and thus libertarian government, by converting sovcorps to the same management design that works well in today’s private sector – the joint-stock corporation.

One way to approach neocameralism is to see it as a refinement of royalism, an ancient system in which the sovcorp is a sort of family business. Under neocameralism, the biological quirks of royalism are eliminated and the State “goes public,” hiring the best executives regardless of their bloodline or even nationality.

Or you can just see neocameralism as part of the usual capitalist pattern in which services are optimized by aligning the interests of the service provider and the service consumer. If this works for groceries, why shouldn’t it work for government? I have a hard time in accepting the possibility that democratic constitutionalism would generate either lower prices or better produce at Safeway …

In order to take a step back from this vision, towards its foundations, it is useful to scrutinize its building blocks. When Moldbug defines property as “any stable structure of monopoly control” what is really meant by ‘control’? It might seem simple enough. To control something is to use, or make use of it — to put it to work, such that a desired outcome is in fact achieved. ‘Property’ would be glossed as exclusive right of use, or instrumental utilization, conceived with sufficient breadth to encompass consumption, and perhaps (we will come to this), donation or exchange.

Complications quickly arise. ‘Control’ in this case would involve technical competence, or the ability to make something work. If control requires that one can use something effectively, then it demands compliance with natural fact (through techno-scientific understanding and practical skills). Even consumption is a type of use. Is this historical variable – vastly distant from intuitive notions of sovereignty – actually suited to a definition of property?

It might be realistic to conceive property through control, and control through technical competence, but it would be hard to defend as an advance in formalism. Since this problem thoroughly infuses the topic of ‘might’, or operational sovereignty, it is also difficult to isolate, or parenthesize. Moldbug’s frequent, enthusiastic digressions into the practicalities of crypto-locked military apparatuses attest strongly to this. The impression begins to emerge that the very possibility of sovereign property is bound to an irreducibly fuzzy, historically dynamic, and empirically intricate investigation into the micro-mechanics of power, dissolving into an acid fog of Clauswitzean ‘friction’ (or ineliminable unpredictability).

More promising, by far – for the purposes of tractable argument — is a strictly formal or contractual usage of ‘control’ to designate the exclusive right to free disposal or commercial alienation. Defined this way, ownership is a legal category, co-original with the idea of contract, referring to those things which one has the right to trade (based on natural law). Property is essentially marketable. It cannot exist unless it can be alienated through negotiation. A prince who cannot trade away his territory does not ‘own’ it in any sense that matters.

Moldbug seems to acknowledge this, in at least three ways. Firstly, his formalization of sovereign power, through conversion into sovereign stock, commercializes it. Within the neocameral regime, power takes the form of revenue-yielding property, available for free disposal by those who wield it. That is the sole basis for the corporate analogy. If sovereign stock were not freely disposable, its ‘owners’ would be mere stewards, subject to obligations, non-alienable political responsibilities, or administrative duties that demonstrate with absolute clarity the subordination to a higher sovereignty. (That is, broadly speaking, the current situation, and inoffensively conventional political theory.)

Secondly, the neocameral state exists within a patchwork, or system of interactions, through which they compete for population, and in which peaceful (or commercial) redistributions — including takeovers and break-ups — are facilitated. Unless sovereign stock can be traded within the patchwork, it is not property at all. This in turn indicates that ‘internal’ positive legislation, as dictated by the domestic ‘sovereign’, is embedded within a far more expansive normative system, and the definition of ‘property’ cannot be exhausted by its local determination within the neocameral micro-polis. As Moldbug repeatedly notes, an introverted despotism that violated broader patchwork norms – such as those governing free exit — could be reliably expected to suffer a collapse of sovereign stock value (which implies that the substance of sovereign stock is systemically, rather than locally, determined). If the entire neocameral state is disciplined through the patchwork, how real can its local sovereignty be? This systemic disciplining or subversion of local sovereignty, it should be noted, is the sole attraction of the neocameral schema to supporters of dynamic geography (who want nothing more than for the national government to become the patchwork system’s bitch).

Thirdly (and relatedly), neocameralism is floated as a model for experimental government, driven cybernetically towards effectiveness by the same types of feedback mechanisms that control ‘secondary’ corporations. In particular, population traffic between neocameral states is conceived as a fundamental regulator, continuously measuring the functionality of government, and correcting it in the direction of attractiveness. The incentive structure of the neocameral regime – and thus its claim to practical rationality — rests entirely upon this. Once again, however, it is evidently the radical limitation of local sovereignty, rather than its unconstrained expression, which promises to make such governments work. Free exit – to take the single most important instance — is a rule imposed at a higher level than the national sovereign, operating as a natural law of the entire patchwork. Without free exit, a neocameral state is no more than a parochial despotism. The absolute sovereign of the state must choose to comply with a rule he did not legislate … something is coming unstuck here (it’s time to send that white horse to the biodiesel tanks).

Neocameralism necessarily commercializes sovereignty, and in doing so it accommodates power to natural law. Sovereign stock (‘primary property’) and ‘secondary property’ become commercially inter-changeable, dissolving the original distinction, whilst local sovereignty is rendered compliant with the wider commercial order, and thus becomes a form of constrained ‘secondary sovereignty’ relative to the primary or absolute sovereignty of the system itself. Final authority bleeds out into the catallactic ensemble, the agora, or commercium, where what can really happen is decided by natural law. It is this to which sovereign stockholders, if they are to be effective, and to prosper, must defer.

The fundamental point, and the reason why the pretender on the white horse is so misleading, is that sovereignty cannot, in principle, inhere in a particular social agent – whether individual, or group. This is best demonstrated in reference to the concept of natural law (which James Donald outlines with unsurpassed brilliance). When properly understood, or articulated, natural law cannot possibly be violated. Putting your hand into a fire, and being burnt, does not defy the natural law that temperatures beyond a certain range cause tissue damage and pain. Similarly, suppressing private property, and producing economic cataclysm, does not defy the natural law that human economic behavior is sensitive to incentives.

Positive law, as created by legislators, takes the form: do (or don’t do) this. Violations will be punished.

Natural law, as discovered by any rational being, takes the form: do what thou wilt and accept the consequences. Rewards and punishments are intrinsic to it. It cannot be defied, but only misunderstood. It is therefore absolutely sovereign (Deus sive Natura). Like any other being, governments, however powerful, can only comply with it, either through intelligent adaptation and flourishing, or through ignorance, incompetence, degeneration, and death. To God-or-Nature it matters not at all. Natural law is indistinguishable from the true sovereign power which really decides what can work, and what doesn’t, which can then – ‘secondarily’ — be learnt by rational beings, or not.

Moldbug knows this – really. He demonstrates it – to take just one highly informative example — through his insistence that a neocameral state would tend to tax at the Laffer optimum. That is to say, such a state would prove its effectiveness by maximizing the return on sovereign property in compliance with reality. It does not legislate the Laffer curve, or choose for it to exist, but instead recognizes that it has been discovered, and with it an aspect of natural law. Anything less, or other, would be inconsistent with its legitimacy as a competent protector of property. To survive, prosper, and even pretend to sovereignty, it can do nothing else. Its power is delegated by commercium.

It is surely no coincidence that Cnut the Great has been described by Norman Cantor as “the most effective king in Anglo-Saxon history.” As Wikipedia relates his story:

His accession to the Danish throne in 1018 brought the crowns of England and Denmark together. Cnut held this power-base together by uniting Danes and Englishmen under cultural bonds of wealth and custom, rather than sheer brutality.

Most importantly:

Henry of Huntingdon, the 12th-century chronicler, tells how Cnut set his throne by the sea shore and commanded the tide to halt and not wet his feet and robes. Yet “continuing to rise as usual [the tide] dashed over his feet and legs without respect to his royal person. Then the king leapt backwards, saying: ‘Let all men know how empty and worthless is the power of kings, for there is none worthy of the name, but He whom heaven, earth, and sea obey by eternal laws.'”

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Reality Rules

Why Social Darwinism isn’t going anywhere

The name social Darwinism is a modern name given to the various theories of society that emerged in England and the United States in the 1870s, which, it is alleged, sought to apply biological concepts to sociology and politics. The term social Darwinism<em> gained widespread currency when used in 1944 to oppose these earlier concepts. Today, because of the negative connotations of the theory of social Darwinism, especially after the atrocities of the Second World War (including the Holocaust), few people would describe themselves as Social Darwinists and the term is generally seen as pejorative. — Wikipedia

… no one calls himself a social Darwinist. Not now, not ever. Not Herbert Spencer. The term is always used to label one’s opponents. In that sense it’s clearly a more abusive term than “socialist,” a term that millions of people have proudly claimed. — David Boaz

Urban Future somehow missed the excited side-track discussion that bolted to the conclusion: America voted in November 2012 to spare itself from Social Darwinism. Yet, sadly belated as it may be, our rejoinder is unchanged: nothing ever gets spared from Darwinism. That’s what Darwinism is.

The fact that the term Social Darwinism survives only as a slur is abundantly telling, and suffices on its own to explain the ideological ‘evolution’ of recent times. In a nutshell, the dominant usage of ‘social Darwinism’ says “markets are a kind of Nazi thing.” Checkmate in one move.

Markets implement a Darwinian process by eliminating failure. Schumpeter called it ‘creative destruction’. The principle unit of selection is the business enterprise, which is able to innovate, adapt, propagate, and evolve precisely insofar as it is also exposed to the risk of perishing. None of this is especially complicated, or even controversial. In a sane world it is what ‘social Darwinism’ would mean. It is certainly what Herbert Spencer was really talking about (although he never adopted the label).

The fundamental tenet of Social Darwinism would then be compressible into a couple of words: reality rules. There’s more, of course, but nothing especially challenging. The further additions are really subtractions, or reservations – intellectual economies, negative principles, and non-commitments. That’s because Darwinism – whether ‘social’ or otherwise – is built from subtractions. Deducting all supernatural causality and transcendent agencies leaves Darwinism as the way complex structures get designed. (Not constructed, but designed, in conformity with a naturalistic theory of plans, blueprints, recipes, or assembly codes, of the kind that have naturally invited supernatural explanation. Darwinism only applies to practical information.)

Subtractions put it together. For instance, remove the extravagant hypothesis that something big and benevolent is looking after us, whether God, the State, or some alternative Super-Dad, and the realistic residue indicates that our mistakes kill us. It follows that anything still hanging around has a history of avoiding serious mistakes, which it may or may not be persisting with – and persistence will tell. If we’re forgetting important lessons, we’ll pay (in the currency of survival).

If this is mere tautology, as has not infrequently been alleged, then there’s not even any need for controversy. But of course, controversy there is, plentifully, and so deeply entrenched that the most banal expositions capture it best. Consider this, from the self-assuredly pedestrian United States History site:

Social Darwinism was the application of Charles Darwin’s scientific theories of evolution and natural selection to contemporary social development. In nature, only the fittest survived — so too in the marketplace. This form of justification was enthusiastically adopted by many American businessmen as scientific proof of their superiority.

What is this supremely typical paragraph really saying? That some American businesses survived, were thus seen as “the fittest” (= they had survived), ‘justified’ (= they had survived), and ‘proven to be superior’ (= they had survived), in other words, a string of perfectly empty identity statements that is in some way supposed to embody a radically disreputable form of ruthless social extremism. This same systematic logical error, seen with tedious insistence in all instance of commentary on ‘social Darwinism’, was baptized by Schopenhauer ‘hypostasis of the concept’. It seizes upon something, repeats it exactly but in different terms, and then pretends to have added information. Once this error is corrected for, substantial discussion of the topic is exposed in its full, dazzling vacuity.

A writhing David Boaz cites the Encyclopedia Britannica [entry on Social Darwinism, which describes it as:

… the theory that persons, groups, and races are subject to the same laws of natural selection as Charles Darwin had perceived in plants and animals in nature. According to the theory, which was popular in the late 19th and early 20th centuries, the weak were diminished and their cultures delimited, while the strong grew in power and in cultural influence over the weak…. The poor were the “unfit” and should not be aided; in the struggle for existence, wealth was a sign of success. At the societal level, social Darwinism was used as a philosophical rationalization for imperialist, colonialist, and racist policies, sustaining belief in Anglo-Saxon or Aryan cultural and biological superiority.

It is immediately clear that this passage, too, follows the already-familiar pattern, clocking ‘hypostasis of the concept’ to the edge of spontaneous combustion. Worse still, it tries to put its hypostasized ‘information’ to work through the positive proposition — tacitly insinuated rather than firmly stated – that “persons, groups, and races” are something other than “animals in nature.” Nature, it seems, ceased to apply at some threshold of human social development, when people stopped being animals, and became something else. Man is not only doubled (as a natural being and something else), but divided between incommensurable kingdoms, whose re-integration is morally akin to “rationalization for imperialist, colonialist, and racist policies” and – why not admit it? — fascist genocide.

Define nature in such a way that we’re not part of it, or you’re engaged in Nazi apologetics says Encyclopedia Britannica. There’s obviously something about social Darwinism that gets people excited — several things, actually. Plugging the spontaneous theory of laissez faire capitalism into traumatic association with the Third Reich is thrilling enough, especially because that’s the basic platform for the epoch of actually existing fascism (which we still inhabit), but there’s more.

The most obvious clue, from which the Encyclopedia Britannica passage unravels like a piece of incompetent knitting, is the magical appearance of ‘should’ – “The poor were the ‘unfit’ and should not be aided.” This is another preposterous hypostasis, naturally (and unnaturally), but equally typical. At the evolution site talkorigins, John S. Wilkins tells us: “’Social Darwinism’ … holds that social policy should allow the weak and unfit to fail and die, and that this is not only good policy but morally right.” The intellectual perversity here is truly fascinating.

Any naturalistic social theory subtracts, or at least suspends, moral evaluation. It says: this is the way things are (however we might want them to be). Yet here, through hypostatic doubling, or redundancy, such neutral realism is converted into a bizarre, morally-charged stance: nature should happen. Social Darwinism is not attempting to explain, but rather siding with reality (those Nazis!).

This is, quite simply and literally, madness. Left dissatisfied by mere denial of the modest proposition that reality rules, the denunciation of social Darwinism proceeds smoothly to the accusation that realists are aiding and abetting the enemy. The unforgivable crime is to accept that there are consequences, or results, other than those we have agreed to allow.

The reality is that practical decisions have real consequences. If those consequences are annulled by, or absorbed into, a more comprehensive social entity, then that entity inherits them. What it incentivizes it grows into. The failures it selects for become its own. When maladaptive decisions are displaced, or aggregated, they are not dispelled, but reinforced, generalized, and exacerbated. Whatever the scale of the social being under consideration, it either finds a way to work, and to reward what works, or it perishes, whether as a whole, or in pieces. That is the ‘social Darwinism’ that will return, eventually, because reality rules, and rather than joining the clamor of denunciation, Boaz would have been prescient to reclaim it.

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Forward!

Maximum warp into Left Singularity

That was all thoroughly unambiguous. It turns out that Obama really is the FDR for this turn of the gyre. Nate Silver and Paul Krugman are vindicated. The New York Times is the gospel of the age. Conservatism is crushed and humiliated. The brake pedal has been hurled out of the window. There’s no stopping it now.

The day before the election, Der Spiegel described “the United States as a country that doesn’t understand the signs of the times and has almost willfully — flying in the face of all scientific knowledge — chosen to be backward.” For the magazine’s staff writers, the problem was utterly straightforward. “The hatred of big government has reached a level in the United States that threatens the country’s very existence.” Retrogressive forces were impeding the country’s progress by refusing to grasp the obvious identity of Leviathan and social advancement. It should now be obvious to everyone – even charred tea partiers gibbering shell-shocked in the ruins — that contemporary American democracy provides all the impetus necessary to bulldoze such obstructionism aside. The State is God, and all shall bend to its will. Forward!

With the ascension of USG to godhood, a new purity is attained, and a fantastic (and Titanic) experiment progresses to a new stage. It is no longer necessary to enter into controversy with the shattered detritus of the right, henceforth all that matters is the test of strength between concentrated political motivation and the obduracy of reality itself. Which is to say: the final resistance to be overcome is the insolent idea of a reality principle, or outside. Once there is no longer any way of things that exists independently of the State’s sovereign desire, Left Singularity is attained. This is the eschatological promise that sings its hallelujahs in every progressive breast. It translates perfectly into the colloquial chant: yes we can!

Of course, it needs to be clearly understood that ‘we’ – now and going forward – means the State. Through the State we do anything and everything, which we can, if not really, then at least truly, as promised. The State is ‘us’ as God. Hegel already saw all this, but it took progressive educational systems to generalize the insight. Now our time has come, or is coming. All together now: yes we can! Nothing but a brittle reactionary realism stands in our way, and that is something we can be educated out of (yes we can). We have! See our blasted enemies strewn in utter devastation before us.

The world is to be as we will it to be. Surely.

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Signs of Progress

How the modern world lost its senses

The more sophisticated animals become, the worse they get at connecting with reality. As they cephalize, and socialize, stories substitute for reflexes, and the survival value of a story owes almost nothing to its factuality. Believing what everyone else does, or what makes you feel good, counts for vastly more. Wherever it is that discussion leads, it is only very rarely, and accidentally, in the direction of reality.

Science begins with the realization that stories aren’t to be trusted, even – or especially – if they sound credible, conform to prior intuitions, and readily attain social approval. Since narrative satisfaction is the great deceiver, science reaches beyond language into the vast frigid tracts of mathematical signs, stripped clean of all moral and emotional significance. Hardening itself against the temptation to see faces in the clouds, or hear voices from the heavens, it digs determinedly into the test-bed of numbers and quantitative signals, where seductive words are led to die.

Economics has never been a science, but economic behavior, and even theory, has been able to avail itself of a measure of leverage against story-telling. Its great resource in this regard has been the price system, expressed in ‘meaningless’ quantities (without immediate narrative significance) which enable economic calculation to sustain a posture of ideological indifference. An accountant who tells a story is a bad accountant, and most probably a criminal, whilst an entrepreneur fixated upon a story of how things ‘must be’ is subject to market-Darwinian nemesis. That, at least, is how laissez-faire hard money capitalism once roughly worked, as attested for instance by the indignation of Charles Dickens, who insisted upon the right of moral, political, and religious story-telling in the midst of a process that systematically disdained it.

Things have progressed incalculably since then, in a direction that could be confidently described as ‘Dickensian’ if that adjective had not already been settled in its highly-effective polemical purpose. That ‘the Big Story’ (BS) would triumph over calculative Scroogean realism was perhaps entirely predictable, but the near-metaphysical comprehensiveness of its victory – and its revenge — was less easy to anticipate. When attempting to gauge this progress, money is the best indicator, or rather, the destruction of money as an indicator is the most telling sign.

Under the conditions of hard money industrial capitalism, progress follows two, rigorously accounted tracks. Most notoriously, it is measured as a process of accumulation, or the amassing of fortunes through profitable business activity. Economic intelligence is socially dispersed along with the multitude of fortunes, with each unit of capital accompanied by its own (Scroogish) accounting function, weighing revenues against outlays, and estimating the viability of continued operation. This intelligence does not lend itself to convenient or reliable public aggregation.

Accompanying the multiplicity of private progressions (and regressions), there is a second track measuring social advance in strictly quantitative, meaningless, and unambiguous terms. On this track, technical and organizational improvements in business activity overspill private accounts, and take the form of public ‘externalities’. Under any monetary system competent to register reality, such general social advances are expressed as falling prices, cost reduction, or deflation. (A typically insightful Zero Hedge post on the topic can be found here.)

The importance of this point is difficult to over-emphasize, especially since it directly contradicts our carefully fabricated neo-Dickensian common sense: Deflation! Isn’t that kind of like fascism or something?

Deflation can certainly represent a type of socio-economic misfortune, under specific conditions. During business cycle downturns, for instance, it can reflect fire-sale asset or inventory reductions, driven by, and exacerbating, credit crises. The seriousness and typicality of such cases is strongly asserted in the dominant (neo-Dickensian) story of the Great Depression. It is worth noting, however, that even under these circumstances – at the worst – the first-order effect of deflation is to generate a spontaneous increase in affluence, or spending power. When life is at its toughest, it gets cheaper to live.

In the hard money world, chronic mild deflation simply is social progress. The two concepts are effectively indistinguishable. Gentle deflation is the invisible hand out, giving everybody a little more of almost everything, year by year, as it spontaneously distributes a fraction of the ‘social surplus’, or public dividend on rising productivity. Even in today’s radically progressed world of ruined money, the output of the consumer electronics industry still manages to exhibit the deflationary trends that have been obliterated elsewhere (so next time you buy a gizmo, don’t forget to feel appropriately oppressed.)

What the hell in heavens happened? How did modernity’s metallo-monetary senses get turned off, rapturing Scrooge into a Christmas Carol, and eclipsing industrial reality? One obvious neo-Dickensian go-to guy for that is William Jennings Bryan (1860-1925), a politician whose multi-dimensional war against reality – truly astounding in its consistency – represents enthusiasm for the Big Story (or ‘social gospel’) at its most uncompromised. Either Bryan’s anti-Darwinism (the Scopes trial) or his ardent prohibitionism (campaigning for the 18th amendment) would have sufficed to earn him a place in the historical record as a hero of the BS (‘evangelical’ or ‘progressive’) State, but his most enduring legacy rests upon the speech he delivered on July 9, 1896, to the Democratic National Convention in Chicago, in which he declared – as if to Scrooge himself – that “You shall not press down upon the brow of labor this crown of thorns; you shall not crucify mankind upon a cross of gold.”

This is a declaration that is sublimed to progressive universality through the elimination of context. Embedded within the late 19th century debates on bimetallism (price-fixing of gold-silver exchange rates), its present implications are significantly diluted, or at least complicated, by questions about the financial responsibility of central authorities, creditor-debtor class warfare, global economic integration, agrarian-urban tensions, and (East-West) regional politics in the USA. Yet, fundamentally, it can be recognized as ‘Dickensian’: the passionate denunciation of a neutral criterion for economic reality, precisely for its neutrality, or indifference to Big Story moral-historical narrative. Gold is cold. It measures without judgment. Between damnation and salvation it demonstrates no preference or inclination.

Concretely, gold was registering, in economic terms, the social upheaval of American industrial urbanization. Mechanization of agriculture implied falling food prices, ruination of small farmers, and rural depopulation, during a sustained process of massive disruption whose miseries were only exceeded by the socio-economic revitalization in its wake. In its distribution and in its accounting function, gold facilitated the depreciation of rural labor, the bankruptcy of misallocated businesses, and the empowerment of concentrated industrial capital in the nation’s rising urban centers. Bryan articulated the views of those at the sharpest edge of this shift, who found the messenger culpable for the message, the senses guilty for the scene: “If thine eye offends thee pluck it out” (Matthew 18:9). (Even though Bryan lost all three of his presidential elections bids, we’re all totally plucked.)

To make of money a vehicle of moral purpose, rather than a neutral registry of fact, is to make the crossing from liberalism and progress as they were once understood (dynamic industrialism), to the progressive liberalism of today (political evangelism). If money can save us (through ‘demand management’), as the Keynesians insist, then its politicization is a moral imperative, whose neglect is a sin of omission. The senses are transformed into story-tellers. Shut the windows, and listen to the Christmas Carol. It’s progress (honestly).

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Suspended Animation (Part 5)

Engines of Devastation

Does Postmodernism still seem cool to anybody? — Probably not. Having sold whatever simulacrum of a soul it might have had to the fickle gods of fashion, it has learnt more about the reign of Chronos than it might have expected to – the kids get devoured, and it’s on to something new. What was accepted for no good reason gets discarded for no good reason. In political science it’s called democracy (but that’s another discussion).

Clearly, there’s something profoundly just about the disappearance of postmodernism into the trashcan of random difference (what’s ‘in’ has to be new, preferably meaninglessly so). It’s even ‘poetically just’, whatever that means. But it also destroys information. Although Postmodernism was certainly a fad, it was also a zeitgeist, or spirit of the times. It meant something, despite its own best efforts, at least as a symptom. The disappearance of reality that it announced was itself real, as was the realm of simulation that replaced it. At least in its death, it might have amounted to something.

Consider its greatest mystagogue, Jacques Derrida, and his once widely celebrated ‘concept’ of differance (yes, with an ‘a’), a term within a series of magical words that mark the undecidable, ungraspable, unpresentable, and ultimately inconceivable ontological non-stuff that supplants real events, through an endless succession of displacements and postponements. We can’t really say anything about it, so we have to talk about it endlessly, and entire university departments are required to do so. It’s ridiculous (and so it’s over). But it’s also, quite exactly, the globally hegemonic culture of Keynesianized, macroeconomic, programmatic stagnationism, and that isn’t over yet, although its morbidity is already highly conspicuous. Unlike faddish academic Postmodernism, its death is going to be really interesting.

Long before the Derridoids got started, Keynes had taught governments that differance was something they could do. Procrastination – the strategic suspension of economic reality through a popularly ungraspable series of displacements and postponements – quickly came to define the art of politics. Why suffer today what can be put off until tomorrow, or suffer yourself something that could be somebody else’s problem? Postpone! Displace! In the long run we are all dead. Reality is for losers.

Differance as it really works is a lot cruder than its reflection in Postmodern philosophy (and what could be philosophically cruder than an appeal to the notion of ‘reflection’?). For instance, it is fished out of the ontological abgrund and processed by specific public policy mechanisms, sustained by concrete institutions in ways that are to a considerable extent economically measurable, within elastic but most certainly finite geographical and historical limits. Crudest of all, and ultimately decisive, is the circumscription of derealization, by the real, and the return of the apocalyptic, no longer as a phantasmatic avatar of the ‘metaphysics of presence’ (or false promise of a real event), but as an impending real event, and one whose process of historical construction is in large measure intelligible. Real differance didn’t ‘deconstruct’ the apocalypse, it built it. It’s not even that difficult to see how.

At EconLog, David Henderson has posted his notes from John H. Cochrane’s December 3 talk at Stanford University’s Hoover Institution conference on ‘Restoring Robust Economic Growth in America’. There’s no mention of differance, but there doesn’t need to be.

For nearly 100 years we have tried to stop runs with government guarantees — deposit insurance, generous lender of last resort, and bailouts. That patch leads to huge moral hazard. Giving a banker a bailout guarantee is like giving a teenager keys to the car and a case of whisky. So, we appoint regulators who are supposed to stop the banks from taking risks, in a hopeless arms race against smart MBAs, lawyers and lobbyists who try to get around the regulation, and though we allow — nay, we encourage and subsidize — expansion of run-prone assets.

In Dodd-Frank, the US simply doubled down our bets on this regime. … 

Bailouts delay a painful economic event (postponement) whilst transferring financial liability (displacement). Risk is restored to virtuality, as disaster is turned back into a threat, but it isn’t the same threat. By any remotely sane method of accountancy, it’s now worse. Significant virtual deterioration is substituted for actual discomfort. That’s the cost of derealization.

How do things get worse, exactly? — In plenty of ways. Start with ‘moral hazard’, which is a polite way of saying ‘insanity’. Actions are decoupled from their consequences, removing the disincentive for craziness. The result, utterly predictably, is more craziness. In fact, anything that systematically enhances moral hazard is simply manufacturing craziness. It’s dumping LSD in the water supply, although actually probably worse. So bailouts drive us insane and destroy civilization (no one really disputes that, although they may try to avoid the topic).

Oh, but there’s more! — Much more, because all these displacements don’t just move things around, they move them up. Risk is centralized, concentrated, systematized, politicized – and that’s in the (entirely unrealistic) best case, when it isn’t also expanded and degraded by the corruption and inefficiency of weakly- or cynically-incentivized public institutions. This is trickle up – really flood up – economics, in which everything bad that ever happens to anybody gets stripped of any residual sanity (or realistic estimation of consequences), pooled, re-coded, complicated by compensatory regulation, and shifted to ever more ethereal heights of populist democratic irresponsibility, where the only thing that matters is what people want to hear, and that really isn’t ever going to be the truth.

“Mess up enough, and you probably suffer or die” – that’s the truth. It’s a message that doesn’t translate into the language of Keynesian kick-the-can politics, which is folk Postmodernism. The nearest we get, as the jaws begin to close on the bail-out bucket chain, is “We’re going to need a bigger boat.” After innumerable episodes of that, we’re all huddled together on the Titanic, and things are kinda, sorta, looking OK. At least the band’s still playing …

When abstracted from its squalid psychosis, the pattern is mathematically quite neat. It’s called the Martingale system, better known to Americans as ‘double or nothing’ (and to Brits as ‘double or quits’). Cochrane already touched upon it (“the US simply doubled down our bets”). Wager on red, and it comes up black. No problem, just double the bet and repeat. You can’t lose. (If you like this logic, Paul Krugman has an economic recovery to sell you.)

What appears as disaster postponed is, in virtual reality, disaster expanded. The Wikipedia entry on the Martingale system helpfully connects it to the Taleb Distribution, otherwise known as scrounging pennies in front of a steam roller. The persistence of small gains makes this business model seem like a sure thing — until it doesn’t.

Nassim Nicholas Taleb and Mark Blyth expand on the idea in Foreign Affairs, with application to various aspects of the current (or impending) crisis. Asking why “surprise [is] the permanent condition of the U.S. political and economic elite” they trace the problem to “the artificial suppression of volatility — the ups and downs of life — in the name of stability.”

Complex systems that have artificially suppressed volatility tend to become extremely fragile, while at the same time exhibiting no visible risks. In fact, they tend to be too calm and exhibit minimal variability as silent risks accumulate beneath the surface. Although the stated intention of political leaders and economic policymakers is to stabilize the system by inhibiting fluctuations, the result tends to be the opposite. These artificially constrained systems become prone to “Black Swans” — that is, they become extremely vulnerable to large-scale events that lie far from the statistical norm and were largely unpredictable to a given set of observers.

Discussing this article at PJMedia, Richard Fernandez glosses and sharpens its conclusion:

Part of the problem is the consequence of [the elites’] own damping. By attempting to centrally manage systems according to some predetermined scheme they actually store up volatility rather than dispersing it. By kicking the can down the road they eventually condemn themselves to bumping into a giant pile of cans when they run out of road. … But the elites cannot admit to surprise; nor can they admit to bad things starting on their watch. Therefore they keep sweeping things under the carpet until, as in some horror movie, it spawns a zombie. To make systems robust, says Taleb, you’ve got to admit that you can make mistakes and pay the price. You will have to in the end anyway.

We aren’t in Postmodernism anymore, Toto. We’re nearer to this:

The wavelike movement affecting the economic system, the recurrence of periods of boom which are followed by periods of depression, is the unavoidable outcome of the attempts, repeated again and again, to lower the gross market rate of interest by means of credit expansion. There is no means of avoiding the final collapse of a boom brought about by credit expansion. The alternative is only whether the crisis should come sooner as the result of a voluntary abandonment of further credit expansion, or later as a final and total catastrophe of the currency system involved. (Ludwig von Mises, Human Action)

Or even this:

Great is Bankruptcy: the great bottomless gulf into which all Falsehoods, public and private, do sink, disappearing; whither, from the first origin of them, they were all doomed. For Nature is true and not a lie. No lie you can speak or act but it will come, after longer or shorter circulation, like a Bill drawn on Nature’s Reality, and be presented there for payment,- -with the answer, No effects. Pity only that it often had so long a circulation: that the original forger were so seldom he who bore the final smart of it! Lies, and the burden of evil they bring, are passed on; shifted from back to back, and from rank to rank; and so land ultimately on the dumb lowest rank, who with spade and mattock, with sore heart and empty wallet, daily come in contact with reality, and can pass the cheat no further.

Observe nevertheless how, by a just compensating law, if the lie with its burden (in this confused whirlpool of Society) sinks and is shifted ever downwards, then in return the distress of it rises ever upwards and upwards. Whereby, after the long pining and demi-starvation of those Twenty Millions, a Duke de Coigny and his Majesty come also to have their ‘real quarrel.’ Such is the law of just Nature; bringing, though at long intervals, and were it only by Bankruptcy, matters round again to the mark.

But with a Fortunatus’ Purse in his pocket, through what length of time might not almost any Falsehood last! Your Society, your Household, practical or spiritual Arrangement, is untrue, unjust, offensive to the eye of God and man. Nevertheless its hearth is warm, its larder well replenished: the innumerable Swiss of Heaven, with a kind of Natural loyalty, gather round it; will prove, by pamphleteering, musketeering, that it is a truth; or if not an unmixed (unearthly, impossible) Truth, then better, a wholesomely attempered one, (as wind is to the shorn lamb), and works well. Changed outlook, however, when purse and larder grow empty! Was your Arrangement so true, so accordant to Nature’s ways, then how, in the name of wonder, has Nature, with her infinite bounty, come to leave it famishing there? To all men, to all women and all children, it is now indutiable that your Arrangement was false. Honour to Bankruptcy; ever righteous on the great scale, though in detail it is so cruel! Under all Falsehoods it works, unweariedly mining. No Falsehood, did it rise heaven- high and cover the world, but Bankruptcy, one day, will sweep it down, and make us free of it. (Thomas Carlyle, via Mencius Moldbug, but cited all over the place recently)

Here it comes.

[Tomb]

Calendric Dominion (Part 4)

A Digression into the Reality Principle

Between the world we would like to inhabit, and the world that exists, there’s a gap that tests us. Even the simplest description of this gap already calls for a decision. ‘Ideologies’ in the broadest, and culturally almost all-consuming sense, serve primarily to soften it. Sense, and even compassion, is attributed to the side of reality, promising ultimate reconciliation between human hopes and desires and the ‘objective’ nature of things. Science, a typically despised and misanthropic discipline, tends to the opposite assumption, emphasizing the harsh indifference of reality to human interests and expectations, with the implication that the lessons it teaches us can be administered with unlimited brutality. We can dash ourselves against reality if we insist, but we cannot realistically anticipate some merciful moderation of the consequences. Nature does not scold or punish, it merely breaks us, coldly, upon the rack of our untruths.

Like other cultural institutions, calendars are saturated with ideologies, and tested to destruction against implacable reality. Their collision with nature is especially informative, because they express obstinate human desires as favored numbers (selected from among small positive integers), and they register the gulf of the real in a strictly quantitative form. Any surviving calendar relates the story of an adaptation to reality, or cultural deference to (and deformation by) nature, as numerical preferences have been compromised through their encounter with quantitative facts.

Pure ideology in the calendrical sphere is represented in its perfection by the fantasy year of the ancient Mesopotamians, 360 days in length, and harmonized to the sexagesimal (modulus-60) arithmetic of the Sumerians. Its influence has persisted in the 360 degrees of the geometric circle, and in the related sexagesimal division into minutes and seconds (of time and arc). The archaic calendars of Meso-America and East Asia, as well as those of the Middle East, seem to have been attracted to the 360-day year, as though to an ideal model. If the Great Architect of the Universe had been an anthropomorphic geometer, this is the calendar that would work.

Of course, it doesn’t (with all due respect to the engrossing Biblical counter-argument outlined here). Instead, in the mainstream world calendric tradition – as determined by the eventual global outcome – a first level adaptation systematized the year at 365 days – the Egyptian year. Unlike the 360-day archetypal year, which has all of the first three primes as factors, and thus divides conveniently into ‘months’ or other component periods, the 365-day year represents a reluctant concession to quantitative fact. The number 365 has only two factors (both primes, 5 and 73), but neither seems to have acquired any discernible calendrical valency, perhaps because of their obvious unsuitability to even approximate description of lunar periods. The Egyptians turned instead to an awkward but influential innovation: the intercalation. A five-day appendix was added to the year, as a sheer correction or supplementary commensuration, and an annual reminder of the gap between numerical elegance and astronomical reality. Whilst intercalations were invested with mytho-religious significance, this was essentially compensatory – a crudely obscured testament to the weakness of ideality (and thus of systematic priest-craft as a mode of reality apprehension, or efficient social purpose). If intercalations were necessary, then nature was not spell-bound, and the priest-masters of calendric time were exposed, tacitly, as purveyors of mystification, whose limits were drawn by the horizon of social credulity. Astronomical time mocked the meanings of men.

Over time, the real (‘tropical’) year discredits its calendrical idealizations by unmooring dates from the seasons, in a process of time drift that exposes discrepancy, and drives calendar reform. Inaccurate calendars are gradually rendered meaningless, as the seasonal associations of its time terms are eroded to utter randomness – by frigid ‘summer’ months and scorching ‘winter’ ones. Clearly, no priesthood can survive in a climate that derides the established order of the year, and in which farmers that listen to the holy words (of time) are assured inevitable starvation. Unless tracked within a tolerable margin of accuracy by a calendar that ‘keeps’ the time, the year reverts to an alien and unintelligible thing, entirely exterior to cultural comprehension, whilst society’s reigning symbols appear as a risible, senseless babble, drowned out by the howling chaos of the real.

With the introduction of the Julian Calendar, coinciding with the (non-event) of year zero, comes the recognition that the tropical year is incommensurable with any integer, and that a larger cycle of intercalation is required to track it. A kind of modernity, or structural demystification, is born with the relinquishment of the ideal year, and everything it symbolizes in terms of cosmic design or celestial harmony. The devil’s appendix is attached, irremovably.

Numeracy and time measurement divorce at the origin of caesarean Calendric Dominion, but it is easy to mistake accidents on this path for essential concessions to reality. Even allowing for the inescapable function of intercalations, there was nothing inevitable – at least absolutely or cosmically inevitable – about the utter ruination of numerical coherence that the Julian Calendar incarnated, and passed on.

To explore this (admittedly arcane) topic further requires a digression to the second power, into the relations between numbers and anthropomorphic desire. The obvious starting point is the 360-day calendar of ancient Sumer, and the question: What made this number appealing? Whether examining 360, or its sexagesimal root (60), an arithmetically-conventional attention to prime factors (2, 3, and 5), is initially misleading — although ultimately indispensable. A more illuminating introduction begins with the compound factors 10 and 12, the latter relevant primarily to the lunar cycle (and the archaic dream of an astronomically – or rather astrologically — consistent 12-month year), and the former reflecting the primordial anthropomorphism in matters numeric: decimalism. The 360-day calendar is an object of human desire because it is an anthropo-lunar (or menstrual-lycanthropic?) hybrid, speaking intrinsically to the cycles of human fertility, and to the ‘digital’ patterns instantiated in mammalian body-plans. A 360-day year would be ours (even if alien things are hidden in it).

Anthropomorphic decimalism suggests how certain numerical opportunities went missing, along with zero. ‘Apprehension’ and ‘comprehension’ refer understanding to the prehensile organs of a specific organism, whose bilateral symmetry combines five-fingered hands to produce a count reaching ten, across an interval that belongs to an alien, intractable, third. Triadic beings are monsters, and decimally ungraspable. The bino-decimal structure of the Yi Jing exhibits this with total clarity, through its six-stage time-cycle that counts in the recurrent sequence 1, 2, 4, 8, 7, 5 … Each power of three (within the decimal numerals) is expelled along with zero from the order of apprehensible time. There is no way that a ternary calendric numeracy could ever have been anthropomorphically acceptable – the very thought is (almost definitionally) abominable.

Yet astronomy seems hideously complicit with abomination, at least, if the years are twinned. The sixth power of three (3^6) approximates to the length of two tropical years with a discrepancy of just ~1.48438 days, or less than one day a year. An intercalation of three days every four years (or two twin-year cycles) brings it to the accuracy of the Julian Calendar, and a reduction of this intercalation by one day every 128 years (or 64 (2^6) twin-year cycles) exceeds the accuracy of the Gregorian calendar.

It might be necessary to be slightly unbalanced to fully appreciate this extraordinary conjunction of numerical elegance and astronomical fact. A system of calendric computation that counts only in twos and threes, and which maintains a perfectly triadic order of time-division up to the duration of a two-year period, is able to quite easily exceed the performance of the dominant international calendar (reaching a level of accuracy that disappears into the inherent instability of the tropical year, and is thus strictly speaking unimprovable).

How many days are there in a year? ((3 x 3 x 3 x 3 x 3 x 3) / 2) + ~0.74219

The horror, the horror …

[Tomb]