Archive for the ‘Economics’ Category

America on Disability

April 20, 2013

Unknown-2NPR’s “This American Life” broadcast a report by Chana Joffe-Walt about the Disability system. It’s a real eye-opener. (click here; or, for a text version, here.)

The ranks of non-working people collecting government disability benefits have nearly doubled in 15 years, to 14 million. Yet they are ignored in employment/unemployment numbers. Every month we’re told how many jobs the economy added – but not how many people went on disability – usually more. (Thus while the “unemployment rate” (currently 7.6%) keeps going down, the percentage of people actually employed also declines.)

images-1Three big factors ought to be reducing disability rolls. The 1990 Americans With Disabilities Act aimed to remove barriers to their employment. Medical advances make more health conditions fixable or manageable. And thirdly, automation and a decline in physically demanding jobs, in favor of the service sector and desk jobs, should enable more people with health issues to work.

Yet despite all this the disability system is ballooning. Why? What NPR’s report makes clear is that it has, de facto, become a hidden welfare program. Disability benefits go to many people not because they physically can’t work but because they’re not employable. They lack the education and/or skills to participate in today’s economy. That’s their “disability.”

This outcome is promoted by what Joffe-Walt calls the “Disability-Industrial complex.” But who, you might ask, could profit from this? images-2Well – lawyers, for one. There’s a whole genre of firms that heavily advertise their specialty of winning disability benefits for clients. The system’s rules give such lawyers a direct cut of the government’s pay-outs.

NPR noted that in normal adversarial hearings (where I spent my career), a lawyer for one side is opposed by one representing the other. But in disability hearings, there is no one speaking up for the other side – for the government and its taxpayers who’ll have to pay if the claimant lawyer wins. No wonder those lawyers usually do win, making this practice so lucrative.

Another part of the Disability-Industrial complex is state governments. If someone’s on welfare, the state pays; on disability, the federal government pays. States have figured this out, and have mounted big efforts to move people from welfare to disability. One large private company makes its money helping states do this.

Disability recipient (colored finger disorder)

Disability recipient (colored finger disorder)

Now, you may also be surprised that a major part of the disability population is: kids.

It’s called “Supplemental Security Income,” and has grown sevenfold in three decades, to 1.3 million child recipients. They’re supposed to be disabled in getting through school. But they become cash cows for their parents. NPR profiled one kid who actually seemed to be thriving in school; and of course his mother wants him to; but not so much that the disability bureaucrats will notice and stop the payments.

I don’t want to imply people live high on the hog on disability benefits. The payments are small, they can’t earn any extra, so are really stuck in poverty. But meantime disability payments now consume a quarter of a trillion dollars annually, more than food stamps and conventional welfare combined. It’s a rotten picture all around.

In a democracy, government is supposed to do voters’ bidding, and they pay for it through taxes. But I don’t think voters and taxpayers were ever asked about this disability monster. It’s a key problem of modern government: programs mutating far beyond anything contemplated at their start, with no brake, no accountability. It just happens. (Well, in fact it doesn’t just happen – self-interested people like lawyers – and of course we’re all self-interested – make it happen for their own benefit.) And notice that in the recent “sequester,” things like air traffic controllers are being cut, but not programs like disability.

Unknown-1Paying for disability ultimately has to come from what actual working people earn and produce. And disability is just part of our larger economic challenge: an ever smaller population percentage actually working and producing, to pay for all those not doing so: the “disabled,” the welfare recipients, the unemployed, the kids in school till ever later ages, and of course the vast numbers living ever longer in retirement drawing pensions and racking up ever larger health care bills. All this on the backs of the shrinking core of people who produce.

As I’ve stressed till blue in the face, Unknown-3we can no longer tolerate an education system so crappy that millions don’t even finish high school and millions are relegated to lifetime “disability” benefits because they’re not employable. And how bizarre that with so many citizens not working, we’re so hostile to foreigners who want to come here to work. Without getting more people in productive employment, America will go bust.

Free Market Economics and eBay

April 13, 2013

imagesI have criticized critics of capitalism and market economics. Mostly, what they denounce is either a straw-man caricature, or else a very small part of a very large phenomenon. While of course there are problems, as with any aspect of human life, if you think about it the great bulk of what you spend money on you’re very glad to get. But what people like me defend is not simply “markets” but free markets. Competition is essential; with it, businesses keep each other in check, and consumers win. Without it, beware. (And too often regulation of markets impedes competition.)

It’s easy to see the behavioral difference competition makes. Take eBay. I buy a lot of stuff there; I even used it to buy an ISBN number! (What’s that? Look it up.) The eBay market is fiercely competitive, and my experience dealing with sellers has been overwhelmingly positive.

UnknownBut the company eBay itself is virtually a monopoly; akin to a “natural monopoly” (like your electric utility) where having multiple competitors wouldn’t really work. Once eBay established itself as “the” online auction site, where buyers find the most sellers and vice versa, no competing site could gain traction. And, with no real competitors, eBay’s customer service is unsurprisingly atrocious.

I recently returned a rare coin to Germany. Since registered mail each way takes several weeks, I didn’t know I had a problem until two months after my payment. I thought I was protected by eBay rules; but when I tried to open a “case,” by e-mail, I was told the window is only 45 days.

images-1Now the fun begins. I want to talk to somebody at eBay about this. Trying to phone gets nowhere; recordings tell you to click on “live help” on eBay’s website. Too bad there’s no such place to click. My further e-mails generate a comedy of repetitive non-responsive boiler-plate replies, with more instructions to use website features that don’t exist, as well as non-working telephone numbers to call. After continuing to complain about all this, I finally get a response in German. I reply (in German) images-2that I don’t speak German. No answer. I send a snail-mail complaint letter to eBay’s president. No answer.

(I have posted online most of the e-mail exchange; if you’ve got nothing better to do, click here).

This is what you get when there’s no competition. Will I stop using eBay? No; there’s alternative. And they know that.

Postal Service Poster Boy

Postal Service Poster Boy

Another case: U.S. Postal Service. Four big registered packages mailed the same day all stolen by a postal employee, they told me. Would they pay on the insurance? Nope. Claims denied: my dealer pricelist, customer orders, and invoices did not prove the value. Eventually, after going through hell with them, they paid. But be warned, absent unimpeachable documentation of value, postal “insurance” is basically a scam.

In contrast, I recently sold my lifelong collection of early Chinese coins, through an auction firm in Germany, Teutoburger Munzauktion. Why? I’d been favorably impressed by their operation. This is another ferociously competitive market. And Teutoburger provided outstanding customer service. Another case was the printing of my recent book, Angels and Pinheads, by 48HrBooks. Again, a highly competitive arena of business. And again, the customer service was outstanding, beyond what one might have expected.

This is why I am a free marketeer.

“Up yours, my policies helped the poor more than any damn socialist ever did.”

April 10, 2013
Cartoon by Jim Morin, Miami Herald

Cartoon by Jim Morin, Miami Herald

Even in Africa

March 29, 2013

high horseWhen William Easterly reviewed Matt Ridley’s The Rational Optimist, he called “disturbing” Ridley’s use of the word “even” regarding Africa, as in saying something good is happening “even in Africa.” Easterly, from a politically correct high horse, sneered at Ridley as “equality challenged.”

Strange perhaps that Easterly himself authored a book titled The White Man’s Burden” !

That’s a cheap shot – but so was Easterly’s. The fact is that most of Africa for decades was obviously, er, “progress challenged,” a graveyard for dreams; so to say that a positive trend is visible “even in Africa” is entirely appropriate. Is it somehow anti-equality to recognize the reality of Africa’s problems?

This blog has long expressed great optimism about progress and the human future. So let me now add too: even in Africa.

Ouattara

Ouattara

When in 2010 I heard news that Cote D’Ivoire’s President Gbagbo, who had lost a (long-delayed) election, was refusing to accept the result, I said to myself, “Here we go again. How many lives will this cost?” The answer was several thousand. But in the end, Gbagbo did not get away with it, and is now a guest of the International Criminal Court awaiting trial. His successor, Alassane Ouattara, a former IMF economist, seems to be responsibly working to tackle the nation’s problems. This is the new Africa.

It is portrayed in an excellent recent survey by The Economist. After colonialism ended, much of Africa was plunged into a morass of incompetent and corrupt, rapacious government by venal dictators, who did what they did because they were pushing on an open door; i.e., civil society did not have its act together sufficiently to stop them. But that has been changing; the door is finally closing, as seen in Cote D’Ivoire, and in many other African countries. Democracy is very much on the rise, more and more elections are being held, more and more fairly, and one by one the dictators have been going; and with them, a lot of the conflict and violence that such rule tends to propagate.

Even (that word again) in places like Sudan, Congo, Angola, and Somalia, no pillars of democracy, violent conflict has been ebbing. Somalia is beginning to rebuild itself as a functioning nation. Sudan’s split into two countries, I had feared, would spark a new war, especially over contested oil resources. But that situation too seems to be calming down.

UnknownAfrica has also seen a lot of material progress, with rising economic growth and incomes, falling poverty, more education, sanitation and better health, and a growing middle class. Real income per person rose over 30% in the last decade (compared to a 10% fall in the two before it). Opinion polls show almost two-thirds of Africans think this year will be better than last. (Only a third of Europeans do.)

This is an obvious consequence of reduced violence, and mainly reflects the overall better quality of governance that democratic politics brings, with officials accountable to voters. A key factor is the general abandonment of socialist and statist economic approaches in favor of more market-oriented, trade-oriented, and investment-oriented policies. It was a hard lesson to learn, but it’s finally being learned in Africa. (In this, Africans may be ahead of those advanced sophisticates in Europe.)

Unknown-2Such changes don’t “just happen.” There are great historical forces in play. The problems that befell post-colonial Africa entailed the basest elements of human nature, with the ascendancy of the worst people. Conversely, the turn-around reflects the efforts of that other and vastly greater segment of humanity, motivated to improve quality of life not only for themselves but for their fellows. Ultimately, that force is the more powerful, and must prevail.

Even in Africa.

My New Book – Angels and Pinheads

March 21, 2013

cover copyMy new book is Angels and Pinheads: A Guide to Which is Which and What’s What. In 226 pages it packs 146 entertaining and provocative essays, commentaries, book reviews, etc., on a wide range of topics, skewering numerous sacred cows; the kinds of things you shouldn’t discuss at Thanksgiving dinner lest you wind up with gravy and mashed potatoes in your face.

The entries are selected as the best from this blog. Of course you can read them here, but the book provides a handy little package that you can enjoy at the beach or in the john.

It’s published by Verity Press International at just $9.95. For more information and ordering details, click here.

Trust, Honesty, and China

March 12, 2013

imagesSo, China is going to eat our economic lunch and dominate the globe? True enough, China has much going for it, mainly hugeness, but also what’s really the world’s most unrestrained free market capitalism (the non-state-owned sector, that is). But not so fast. One element that helped make capitalism so successful in the West seems distinctly weak in China. That is an ethos of trust and honesty.

Sneer cynically if you like, but the fact is that commerce could hardly function at all without a basic level of trust and honesty among participants, and its lack is punished by the market. That’s certainly illustrated in my own business of trading in coins. In dealer-to-dealer trade, especially where authenticity of merchandise is an issue, trust is extremely important. A sleazy dealer soon gets a rep, and weeded out. And we keep each other informed about untrustworthy customers too. They’re actually rare. I send nearly all my orders in advance of payment, with only a tiny percentage of problems. Businesses don’t thrive in the long run by ripping people off, but by catering to their needs. This ethos is embedded in our DNA. In the West, at least.

images-1The Economist recently reported on Yale’s baleful experience setting up shop in China. Now, of course cheating is a real problem in American schools. But it seems Chinese students carried it to a whole new level. Most were literally amoral: getting ahead was all that counted, and the means didn’t matter. Thus plagiarism, for example, was endemic. And an essay by NPR’s Louisa Lim, in the Times Book Review, made a similar point about Chinese culture with regard to how government operates at all levels, with pervasive corruption, bribery being central to the Chinese way of life.

Recently too we learned of the Chinese government’s large scale cyber hacking operation, stealing sensitive information from foreign businesses. Now, Western companies are not all angels, and corporate espionage does happen. But for the government to create a whole bureaucracy to do it?

Cartoon by Dave Granlund

Cartoon by Dave Granlund

And, when caught out, to simply brazenly lie? All this bespeaks a mentality very different from ours.

Columnist David Brooks has observed that it reflects China’s seeing world economic competition as akin to war, with deceit and skullduggery being natural weapons. However, Westerners would regard this as self-defeating, because it destroys the trust that lubricates free exchange. But Brooks fears what he calls a “brutality cascade” in which the rules of the game tend to become those of the most ruthless player.

Yet, he says, there’s another path: strive to establish norms of legitimacy upheld by the broadest possible coalition, isolate the violators, and make it clear that joining the “friendship circle” pays great benefits while staying outside will prove costly.

Chinadigitaltimes.net

Chinadigitaltimes.net

I want to be clear that not all Chinese are amoral. I’ve done business with many good people there. But it’s obvious that there’s an important cultural difference, that I believe will handicap China in building its world economic role. Dishonesty and corruption creates a foundation of sand for an economy. If China wants to become the global economic kingpin, it will have to grow up and become a responsible adult.

As Chinese author Wang Xiaofang has written, quoted in the Times essay, “The habit of falsehood is fatal to a culture. But to us, falsehood is the essence.”

The Sequester: Where the Buck Stops

February 27, 2013

Speaking of reality (or not), the President is going around telling horror stories about the “sequester’s” March 1 budget cuts, and blaming Republicans because they resist raising taxes on the rich.

The reality is that the cuts will happen only because Obama himself insists on such tax hikes. Yet taxes aren’t even part of the sequester (which, incidentally, Obama himself originally ushered into place) — it only concerns spending, and Republicans are willing to compromise on spending. But Obama refuses unless he gets another round of tax hikes into the bargain. Remember, Republicans did already agree to raise taxes on the rich, just weeks ago, in the fiscal cliff deal. In fact, they agreed without any compensatory spending concessions (big mistake). But now Obama demands even more.

Dark red = 2009-12; bright red = 2013-22

Dark red = 2009-12; bright red = 2013-22

If the cuts are as awful as he says, then it’s his responsibility to avert them. After all, he’s president. As Truman said, “the buck stops here.” Passing it to Republicans doesn’t wash, if the problem can be solved simply by Obama relenting in his monomania on taxes. But he thinks “tax the rich” continues to work for him politically, and he won’t drop it.

Furthermore, as head of the government, he could do plenty to prevent sequestration’s worst impacts; but instead he actually seems intent on heightening the pain, believing he’ll get away with blaming Republicans. This is all political theater, aimed at Democrats retaking the House in 2014, reviving their otherwise unpassable legislative agenda.

It’s tempting to actually welcome the sequester as at least achieving what Washington has been so incapable of: cutting spending. Unfortunately, it’s entirely the wrong way to go about it, indiscriminately cutting across-the-board rather than sensibly prioritizing. For example, as I’ve said, the Defense budget is way over-bloated, but the sequester will target the muscle equally with the fat.

Meantime it will hardly touch the real heart of our budgetary mess: Medicare, Medicaid, and Social Security. But at least this does cast a spotlight on the fix we’re in. So sacred are these cows that they were largely exempted even from the sequester’s otherwise “across-the-board” cuts. Concentrating those cuts on lesser non-entitlement discretionary spending intensifies the effect there. But even so, these cuts are still a tiny percentage. That it’s so contentious to cut even this little bit from such a huge budget shows the depth of the problem.

imagesWhat we need is a long term plan to get deficits into manageable territory by reforming entitlements, mainly by constraining benefits for the affluent. The President isn’t interested. Without this, entitlements are on track to swamp the budget and eventually crowd out all other expenditures. The sequester gives us a small foretaste of that future. We’ll wind up with a government confined mainly to sending out benefit checks, able to afford little else.

This will be the supremely ironic endgame for the liberal dream of muscular government fixing all problems and righting all wrongs.

An Ideology of Reality

February 22, 2013

I’ve done many blog posts, books and articles, and otherwise engaged in public discourse, upon a wide range of topics. So I ask myself if there’s a unifying idea, a thread connecting it all.

I’ve previously discussed what really matters: and the only possible answer is the feelings of beings capable of feeling. Hence the over-arching goal to advance human flourishing.

imagesBut this verges on banality; most people would embrace some variant of it, and likewise profess to aim at human betterment. Even some of history’s worst villains would have. Where did they go wrong? Fundamental mistakes about reality (including realities of human nature).

It’s not enough just to want good. The road to it runs through truth and reality. Other roads lead to Hell.

And so, there’s the real essence of my ideology: truth and reality.

images-3Of course, we all think we see truth. But it’s not so easy. Too often, people believe things because they want to, because it’s comfortable believing them. Ideology or faith drives perception, to see the world in ways that comport with the belief system. Cynics in particular flatter themselves that they’re seeing through to real reality; but very often this too is just what makes them feel good and isn’t reality at all.

So, mindful of all this, I turn things around. I try to make perception drive ideology. I strive to base my beliefs on what I see, not the reverse. That IS my ideology. (Or do I too flatter myself? At least I’m cognizant of the pitfall.)

My core belief system is to respect and accept truth rather than trying to wish it away. Only by understanding the world’s realities can we ever hope to overcome the constraints they impose on us, and make life truly better. The quest for the good cannot be divorced from the quest for the truth.

images-4Consider the example of our current gun debate. Gun control opponents believe a gun in the home protects you. Reality check: statistics indisputably show it’s many times more likely to hurt or kill you than protect you. Gun fanciers believe differently because, well, they just prefer to. (Or they don’t think the statistics apply to them.) They also believe guns can fend off potential government “tyranny.” And pigs can fly.

I’ve written before how some Lefties idealize the likes of Hugo Chavez. I look at the reality. Some people see vaccination as causing autism, and dangers in GM foods. I look at the reality. Some reject evolution. I see the evidence. Ideology leads some to deny the reality of climate change; others, to cling to a solution that denies reality.

images-1The problem is especially prevalent in economic matters. The whole antipathy toward market economics is grounded in caricatures rather than the reality of how it works, what it actually does, and its results. Not to speak of alternatives. While some advocates of protectionism do act with clear-eyed self-interest, most who go along are blind to the broader harm, indeed the harm to their actual self-interest. Opposition to outsourcing reflects a simplistic zero-sum economic picture totally at odds with the reality. And the French, many Democrats, and even Nobel-winning economist Paul Krugman seem to think there’s no limit to how much can be borrowed to pay out ever spiraling “benefits” (the Greeks learned differently). And so forth.

Of course the biggest whoppers people tell themselves are religious. Now, there isn’t great harm in believing inconsequential nonsense like astrology. But when you believe some divine being is running the world and your life, that’s consequential in the highest degree. images-2Likewise belief in Heaven. How can one make proper sense of life, and operate rationally in the world, laboring under such profound reality mistakes? You can’t even get right the basic “mattering” question if you think God is in the answer.

I’ve written about Muslim societies and violence. I did say there’s something besides just religious belief in play. Nevertheless, imagine how Muslims might settle down and behave if all that religious insanity went away. And please don’t tell me religion is the only check on their baser impulses. I know lots of atheists, and nearly all behave quite nicely. As for Muslims, the reality is that conflict and violence aren’t doing them any good; and if they got a better grip on the reality of the world they live in, they would realize this, and act differently.

Gimme that old time reality – it’s good enough for me.

State of the Union: US: Sweden

February 15, 2013

imagesSo the President gets up there and unveils a host of big new government programs. Then he says they won’t add a dime to the deficit. That would be true only if:

a) They don’t pass Congress, or
b) Taxes are raised, or
c) Other programs are cut

As to (c), of course the President has proposed no such cuts. In fact, after years of talking about a balance of tax hikes and spending cuts, and indeed campaigning on that issue, Obama in the recent fiscal cliff deal got taxes raised without any spending cuts at all.

Cartoon by Eric Allie, Townhall.com

Cartoon by Eric Allie, Townhall.com

This he actually thought was a glorious triumph; liberals are cock-a-hoop that they’ve really stuck it to Republicans.

The Pre-K education proposal epitomizes how they think. Pre-K is actually desperately needed to help disadvantaged kids who are otherwise being done down by crappy schools. But does Obama’s proposal target those kids? No. It’s “universal.” Which means that just like Medicare and farm subsidies and so many other government programs, it will mainly give yet more welfare to the affluent, with the disadvantaged getting only a lesser share of the benefits.

This is not the time to be adding a big new “universal” federal program.

Whatever benefit it may buy will be more than wiped out when the shit hits the fan and our economy sinks under the weight of unsustainable debt. That’s true of all Obama’s economic initiatives. They will all come to nothing and worse if we don’t tackle the one big monster looming on the horizon, our debt. Eyes closed to this, Obama is taking us down the road to ruin.

images-3It doesn’t have to be this way. The Economist recently ran an illuminating survey of the Nordic countries. Remember Sweden, the poster boy for a tax-and-spend “social welfare” state, of cradle-to-grave government cosseting, soaking up the lion’s share of GDP? Well, it’s not your father’s Sweden anymore. That model, the Swedes and other Nordics realized, was doomed, so they reformed; in The Economist’s words, they “put an end to the region’s magical thinking about welfare.”

So they enacted sweeping pension and benefit reforms and put their budgets in balance; Sweden reduced national debt from 84% of GDP in 1996 to 49% in 2011; government’s share of GDP fell by a whopping 18 percentage points. The Nordic countries have also become much more enthusiastic toward the free market and entrepreneurialism, moving their economies away from statism. They embrace free trade and resist the siren song of protectionism. The Swedes now even let private companies compete with government bodies to provide services; a majority of new kindergartens and health clinics are being built by businesses, and citizens can shop around.

images-5This includes school choice; Sweden is now the world’s leading adopter of vouchers. Almost half its schoolkids are in non-public classrooms. And the most comprehensive study of the results shows great performance improvement – especially in the public schools, which competition has forced to raise their game. (Milton Friedman, father of the voucher concept, said the point was not that privately-run schools would be better; rather, all types of schools would be better if they must compete.)

Finland too is a hotbed of educational success. Interestingly, Finland spends proportionately less on schools than America, and teacher pay is relatively low. Yet Finland attracts high quality teachers by giving them something more valuable than money: respect, and thus a high degree of autonomy and responsibility for what they do in class.

So, does all this reform throw granny over the cliff, as in liberal nightmares? No. As I keep saying, rich countries have plenty of money to take care of the needy; it’s welfare for the rich that’s bankrupting us. Nordic budgets have not been balanced on the backs of the disadvantaged. What they have done is to create the conditions for everyone to flourish. And, by all accounts, their populations are quite happy with the change, facing the future with a positive attitude.

images-4Why can’t America get its act together like that? Yes, I know all about our frozen politics and the influence of special interests (like the teachers’ unions). But Sweden and Finland were not utopian paradises free of such societal baggage. Those fat and happy with their old paternalistic policies were equally wedded to them. But their special pleading was overcome. It takes leadership and grit. I continue to believe Americans would support sensible reforms like the Nordics, if only some real leadership were shown.

I guess we’ll have to await another president. Let’s hope it won’t be too late.

How To Solve All Societal Problems

January 28, 2013

The theme of Rebecca Costa’s 2010 book The Watchman’s Rattle* is that the complexity of modern life is itself the key to the complex problems we face. imagesOur brains did evolve to handle complexity, especially that of social relations. But the resulting cultural evolution outruns our brains’ biological evolution, and thus our cognitive abilities.

Early on, Costa discusses the Mayans, who she believes succumbed mainly to drought. Their end game degenerated into religious mysticism. Why, Costa asks, didn’t they instead continue pursuing rational solutions? – more wells, reservoirs, cisterns, etc.? In fact, she had earlier called the Mayan hydraulic systems “masterpieces of design and engineering.” But she thinks they hit what she labels a “cognitive threshold.” Actually, however, it seems that rational solutions reached their limit – there was nothing the Mayans could have done to overcome their water deficit.

Unknown-1Yet Costa draws a parallel with California’s water shortage problem. Here too, all current efforts seem doomed to eventual inadequacy. A frustrated Costa declares: “We need to manufacture more water.” (Her italics) What she means is desalination (making seawater usable). What’s stopping us? Not technology; unlike the Mayans, we could do it. Our problem, Costa says, is attitudinal.

To explain, she invokes the concept of the meme (coined by scientist Richard Dawkins), the cultural equivalent of genes. Memes are ideas that propagate, and can pre-empt other forms of thought. Like religion, a powerful set of memes that certainly obstruct other, incompatible kinds of thinking.

Costa uses the term “supermeme,” and focuses on several. One she calls “irrational opposition.” While I think this misapplies the meme concept, Costa is certainly on to something: a culturally rooted thinking pattern of “rejecting, criticizing, suppressing, ignoring, misrepresenting, [and] marginalizing rational solutions.”

Unknown-2Being against something can be far more emotionally satisfying than supporting it; criticizing a lot easier than defending. But, Costa says, people in opposition mode rarely have any positive solutions to offer. Desalination is a case in point – lots of vocal opposition but, typical of nimbyism, no answers to the problem. Similarly (not in the book), anti-fracking hysteria exemplifies Costa’s point – people need the energy, but obsess over largely hypothetical dangers, while ignoring the far worse ill-effects of familiar energy production modes we already use.

Climate change is a problem where a “cognitive threshold” does seem to be a stumbling block. Interestingly, it’s the environmentalists Costa faults here, for turning their beliefs into a kind of religion rather than a fact-based program for rational action. She’s talking about their insistence solely upon reducing carbon emissions. This does have earmarks of religious belief, both in its moralistic manichaeanism – casting humanity as a pack of sinners who need to don hair shirts in penance – and its disregard for factual reality. Indeed, it’s not just the climate denialists with their heads in the sand – the believers are wedded to a plan that cannot possibly work. Even if carbon emissions went to zero, global temperatures would still continue to rise significantly.

Costa instead advocates geo-engineering solutions – for example, replicating the effect of volcanoes by putting sulfate particles in the upper atmosphere to cool the planet – a vastly more efficacious and vastly less costly approach (as I’ve discussed). Yet all such proposals the McKibbenite climate zealots demonize as heresy.

Costa also applies her analysis to politics, where again inciting opposition is far easier than enlisting support for anything positive. That explains negative campaigning. All you need do is give voters one reason to reject an opponent. Thus we get Willie Horton and foofaws over “legitimate rape.” And while everyone says politicians should compromise, the actual elements of any policy compromise typically engender far more vehement opposition than support.

Though much of the book is great, unfortunately some is utter nonsense. While Costa pokes fun at the old wives’ tale about not swimming for an hour after eating, she falls for the equally false myth of needing eight glasses of water daily.

Worse, Costa doesn’t much hold with personal responsibility. One person’s obesity might be his own fault; but the obesity of millions rises to being systemic. She mocks personal efforts like recycling trash, explaining what little difference it actually makes (household trash being a small fraction of our industrial total). The problems at issue are societal, true enough. But who is society but us? On Costa’s logic, voting too is pointless because one vote can’t make any difference; but obviously, collectively it can be momentous. There is no sense in talking about what “society” can or must do, divorced from what its individual constituent members do.

images-2And while one of Costa’s supermemes is labeled “extreme economics,” I wish she had instead addressed economic irrationality — her own chapter being a prime exemplar. It’s the familiar trope that everything today is reduced to money and profit. Thus she laments that we can’t deploy a device invented by Dean Kamen to produce clean water with minimal electricity because, at two grand a pop, nobody can figure out how to profit. But who again is this “we”? If the economics don’t work, then someone must get stuck with the bill. Costa similarly bemoans things that used to be “free” but now incur charges. But nothing is ever really free. There’s no manna from Heaven. Economics is all about how non-free resources get allocated (and who pays). Failure to understand this can only impede solving the kinds of problems Costa addresses.

Anyway, after going through a litany of those problems, and all our mental obstacles for tackling them, Costa finally comes down with a single catch-all answer: insight. images-3Our brains have this fantastic capability for “Eureka!” moments – like when Newton “discovered gravity” (sic). So we just have to do more of that.

If I sound sarcastic, it’s only partly true. Costa argues that we can improve brain function through mental exercise, and there’s much supporting evidence. Indeed, it appears that fairly modest bouts of brain exercise can have long-lasting cognitive benefits. Why don’t our schools include this? I’ve written (“The Marshmallow Test”) about how inculcating some kinds of character discipline can have big effects, improving kids’ ability to thrive in school and life; and without this, conventional “3Rs” teaching may be largely futile for many students. The same applies to mental exercise to sharpen cognitive functioning. Oddly, Costa doesn’t say this, but our society’s failure to utilize these beneficial techniques is a perfect example of the problem, and changing this could be an important part of the solution.

Meantime, in fact, humans have been thinking smarter and better. This, as I’ve noted, is a key reason Pinker fingered for declining violence in his book, The Better Angels of Our Nature. And, yes, it is declining (read the damn book). Of course we haven’t attained perfection but we’re getting there. And while Costa stresses that our lives’ complexity is outrunning our brain evolution, that only applies to our individual brains. But our mental power is collective. No single person today completely understands any advanced technology, but we don’t need that, when we can combine and coordinate the understandings of the many.

Unknown-3Further, the more of us there are, the more ideas are created; and modernity puts ever more of us in contact with other people and their ideas, so we get ideas bouncing off each other, flowering like branches off a tree, metastasizing. This is why progress happens, and in fact accelerates; it’s the very thing that produces all the complexity Costa talks about. So in the end it’s wrong to see complexity as the problem. It’s why I am an optimist about humankind.

* This title is intended to evoke old-time watchmen who used rattles to signal danger.


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