Why The Next Financial Crash Will Be The Last

~ ginsu ~ Leave a comment

or, an Outline of Everything I’ve Read on Twitter in 2020 so far

  1. The most basic criticism of capitalism is that it is inexorably tied to growth.
    1. Capitalism is the most efficient way to allocate resources.
    2. Efficiency always favors scale.
    3. Scale favors inequality, because greater extraction of resources is enabled by more underclass, so resources are effectively allocated to create larger and larger underclass, with an elite class almost as byproduct. 
  2. We are now at a scale where resource extraction of some form will break some kind of infrastructure required to maintain growth.
    1. The key types of infrastructure that enable large societies are: finance, energy, water, food, housing, military and policing, politics, and environment.
  3. Of infrastructure types, finance is the most fragile and environment is the most vital. So finance will likely break first, and the environment will probably break last – reserving a healthy respect for the combined odds of an unlikely explosive event in any of the other types.
  4. What we are seeing in 2020 is a large scale demonstration that money isn’t an undeniable law of the universe – it is a social convention that is strong enough to call fact, but weak enough to deny as real. In shorthand, we can label people who both see this and feel this as “radicalized.”
    1. We can call people who act on this as “extremist” – while acknowledging that there are many instances where what is now considered just was first considered extreme.
  5. In the current demonstration of financial fragility, we can already see that the owners of the capitalist system will succeed in maintaining the most efficient allocation of resource to reward scale without destroying the system. 
    1. The underclass will receive the minimum concessions required to continue to reach greater scale for continued extraction of resources.
  6. Scale is now at a level that enables the largest and fastest dissemination of information in all of recorded history. The percentage of radicalized people is a minority, but it is larger both in size and in proportion than it has ever been.
    1. There are many very cool things about the dissemination of information and associated technologies, but these are a side show.
  7. Since information feeds radicalization, there is no way to stop the growth of radicalization other than increasing authoritarianism, which is the only way to decrease the flow of information at this point.
  8. Capitalism will therefore allocate resources to authoritarianism because that maximizes the scale of the underclass required to extract maximum resources.
    1. The underclass will receive only the amount of goods and services required for them to accept the devil’s bargain of surviving for further exploitation under authoritarianism.
  9. The size of the radicalized population is large enough to foretell a kind of civil war in the United States. Capitalism is efficient enough to allocate resources to preventing this war from becoming one of blood, though with a “blood and soil” culture as a potential byproduct of the authoritarianism required to slow radicalization.
  10. The most peaceful outcome to hope for is a slow balkanization of the United States. It’s hard to see that trajectory ending in anything other than states not united – not culturally, politically, economically, or legally.
  11. Hopefully a bloodless war is coming first, even if a bloody war might follow later. Since the financial system is the most fragile of infrastructures required to support capitalism, it should not be surprising to see it collapse first.
  12. The collapse of our financial system has now been demonstrated in periodical financial system shocks going back almost four decades.
    1. This started with the initial petrodollar shock of the ’70s – finance is intertwined with energy extraction, which of course drives environmental exploitation.
  13. The observable cracks in the financial system are so large now that it’s hard to believe that an even larger financial system could possibly survive the next crash, which would be due to come in about another decade.
  14. The real limit is not the size of the cracks but that the efficient allocation of resource required for the masses to accept authoritarianism is becoming increasingly indistinguishable from what authoritarians want people to call socialism.
    1. In other words, the next blowup will only be repairable by allocating even more resources to the underclass, which increases the ability of the underclass to communicate and understand radicalism.
  15. The capitalist system will stop short of allowing socialism to end capitalism. As a last gasp, it will empower authoritarians who would kill people if helpful to maintain capitalism.
    1. These people would be largely but not exclusively radicalized. There will be plenty of collateral damage.
    2. These people would be almost exclusively underclass.
  16. The peaceful Hail Mary to hope for is the rapid advancement of technology that would replace human labor with robots and artificial intelligence.
    1. The excess humans would be placated with limitless entertainment, legalized drugs, and universal basic income.
  17. Despite our best hopes, the most likely outcome is that the next financial shock will be the last, either through failure to scale or a war that necessarily includes the destruction of the financial system, which can theoretically be rebuilt under an authoritarian regime. 
  18. There are really funny jokes about each and every one of the points and subpoints above.
    1. The ones about the subpoints are the funniest ones.
    2. A plurality of the jokes are about sex, which means they are the most obvious ones, but doesn’t mean they’re not the funniest ones.

FAQ

WTF is this?

A few months ago, I decided to radically increase my consumption of Twitter. Reading a constant stream of information, I never really took the time to try to assemble everything I’ve learned into a coherent narrative. Now that we are in Covid-19 shelter-in-place, the combination of a huge amount of free time and a rapid amplification and culmination of every message I’ve read previously compels me to write an outline of everything I’ve read recently.

Do you want to argue about this?

No. This is not an argument. This is an outline of everything I’ve absorbed on Twitter in 2020, in the order of a coherent narrative. I’m aware that there are arguments against every single point. I did not include any of them.

I’m aware that my sources are biased, both in my selection and in their content – that is how Twitter works. I’m aware that there are many omissions. I’m aware that some terminology is clumsy, or confusing, or potentially offensive. I’m aware that there are missing perspectives, and there’s a glaring lack of data or even citation. The lack of citation may seem particularly galling to many people. I’m not interested in arguing about any of this.

Are you aware that you’ve made an error? If I explain it to you, will you fix it?

No – if I was aware of an error, I wouldn’t have made it. If you try to explain something to me, I might listen, but I probably won’t go back and “fix” this outline because there is nothing to fix – it’s an accurate outline of what I’ve read on Twitter. Perhaps if there is another pandemic and that gives me free time instead of killing me, I will include your explanation in another outline. I don’t think I’ll want do do this again during this pandemic. I should probably get off of Twitter.

Are you aware that people smarter than you disagree with you?

Yes.

Do you think you’re original?

There is nothing original here. It is an outline of what I’ve read, which means that someone else said it.

Don’t you think you’re missing something?

No. This is an outline. By definition, it excludes the vast majority of content. It also excludes a huge number of relevant historical events, fascinating theories, and all sources not mentioned frequently in my Twitter feed, which necessarily favors time in recent living memory. 

Whatever it is you think I’m missing: If I’m aware of it, I left it out on purpose. If I’m unaware of it, then I didn’t find out about it or didn’t remember it for this outline anyway.

You don’t even mention the pandemic – don’t you think it’s relevant?

The pandemic is a proximate cause of many points in the outline, and gave me time to write the outline, but is not intrinsically important to the points of the outline. The exact same outline could have occurred in an event of an alien attack, assuming the aliens were defeated. In theory either the pandemic or the aliens would end up making this outline irrelevant, but I did not find that theory interesting enough to outline.

Whoa, you mean like how Adrian Veidt fabricated a fake alien octopus to attack the Earth in the hopes of uniting everyone in peace? Do you think that Elon Musk is like Veidt? Do you think the Chinese regime fabricated the novel coronovirus as a subtle act of war, or even as a devious act of peace, à la Veidt?

I too loved The Watchmen. Sorta, he wishes, and no.

What do you think about this technical solution?

This is an outline of what I’ve read on Twitter, it’s not a problem solving session. In any case, all relevant technical solutions are covered in 6.a., 16, and some of 16.a.

Aren’t 5.a and 8.a the same?

No. 5.a. refers to monetary concessions to the underclass in an attempt to repair a financial shock. Such a repair attempt was just passed by the U.S. Senate, and is a current example of point 5. 8.a. refers to goods and services produced by a capitalist system for the underclass, which even under the authoritarianism noted in point 8, can be relatively comfortable. That is why it’s called a “devil’s bargain.” 16.a. is the best case outcome of the devil’s bargain.

Why are there main points and subpoints?

It just seemed to me that some points were not truly necessary to a coherent narrative, but very helpful to understanding a related point. I put these in as subpoints but maybe could have made them main points or probably could have left them out entirely. 

Also, as mentioned in the outline, subpoints tend to inspire the best humor.

Your jokes aren’t funny. Also, there are many things I don’t like about you. I demand that you explain or prove anything you’ve written. I challenge you. You are worthy of neither attention nor admiration, only my unending scorn.

That is not a question. This is a FAQ, which means Frequently Asked Questions.

Do you believe anything you’re saying here? Does this outline align in any way with your personal beliefs or political positions?

Yes, some of it and somewhat.

So then is this your manifesto?

No. This is an outline of everything I’ve read on Twitter recently, assembled in the order of one coherent narrative. This is my manifesto.

Again, WTF is this?

Again: this is March 2020 and we’re under a shelter-in-place order. There’s not a lot to do.

wishful thinking

~ ginsu ~ 1 Comment

I was wrong about why Warren would win the Presidency, bringing a merciful end to my brief non-career as a political prognosticator. (Though really, if a poor record ended dumb predictions, there would be no pundits at all.) I have a lot of the same thoughts that many other Warren supporters have; I don’t have much to add to these types of reflections on:

Clearly my Warren pick was fueled by wishful thinking, so maybe the best use I can make of this space is to try to understand exactly what I was wishing for – this will help me determine whether it’s reasonable to continue wishing or whether I should adhere to a version of reality that doesn’t include those wishes.

Wish #1. I was wishing for an end to the Reagan-Bush-Clinton-Obama line of power. This isn’t the place to push an excoriating critique of neoliberal economics, nor is this about wanting Boomers to just get out of the way. (Warren, after all, is a Boomer.) I simply believe that a small group of like-minded individuals has dominated our politics for far too long. Most people do not see the through-line from Reagan to Obama, but their donors do. There is a solid core of moneyed interests that naturally funds campaigns that protect their wealth. I think that it is their right to do so, but there is no countervailing collective force that could find a better balance of interests. As a result, elites are engaging in a real tragedy of the commons that appears unstoppable.

Wish #2. I was wishing that the media would break its usual pattern of reporting during this cycle. When I was in college (OMG that was 30 fucking years ago), my intro American Politics professor said that “horse race” election coverage was a critical weakness in our democracy that could lead to our demise as a nation. His thesis was that representative democracy depends on citizens making choices based on information about the candidates’ positions. Horse race coverage makes politics into a game show rather than a process, totally obscuring substantive positions. I took that as received wisdom and thought that surely we’d eventually break that cycle. I thought that the media distortions of 2016 were so pernicious and so obvious that we couldn’t possibly continue down this path. I was not just wrong, but incredibly naive as well.

In retrospect, this wishful thinking was completely nonsensical. I was wishing for a reversal of clear trends that have been flourishing for my entire adult life. It’s ok to believe that change is possible, but it’s stupid to believe that it’s probable when looking at powerful long-term trends. The most likely case is for powerful trends to continue until they collapse from their own weight. In fact, the more perverse a trend seems, the more likely it is to continue because in going against all reasonable desires, the trend must be fueled by something more powerful than any of those desires.

So what does “collapse from their own weight” look like? My wishes were overcome by truths – let’s look at what those truths would turn into as they continue on current trend:

Truth #1: Powerful interests retain their hold on power until they are destroyed by their own overreach.

Truth #2: Media coverage will always push for engagement (views, clicks, outrage) over any other goals, until there is no distinction whatsoever between news and entertainment.

In my previous wishful thinking, what were the hopes underlying the wishes? I was hoping that the election of Trump was kind of an aberration, or rather the last dying gasp of several bad ideas. I was hoping that there were enough people in power that wanted to share the wealth with people out of power. I was hoping that this country wouldn’t become the worst version of itself.

All of those wishes seem childish now. What they really all amount to is a wish for peace. Peace between different ways of life. Peace between different kinds of people. Peace between different levels of advantage and disadvantage.

If you believe, as I do, that this country has never been at peace – that there has always been the violence of oppression, bigotry, and inequality – then it is wishful thinking to believe that there ever will be peace. The trends that have led to our current situation have always been there, and they seem much likelier to intensify than dissipate naturally.

Peace by definition disappears with violence. We are not at peace now, because the violence has occurred and is ongoing. The suppression of differing people, ideologies, and backgrounds has been accomplished by long histories of varied violence, whether physical, political, or economic. Once peace has been disturbed by violence, it rarely returns without violence. I wish this weren’t true, but wishful thinking doesn’t do anything but hide the ugly truths.

In short: Things are bad, and they aren’t getting better. They only way they will get better is by getting a lot worse, which isn’t something I’d wish on anyone. But my wishes are irrelevant.

my way

~ ginsu ~ 4 Comments

I named this blog “ginsudo” in 2007, saying that it means “the way of ginsu.” That was a lazy evasion, as the natural follow-up question should be “Sure, but what exactly is your way?” And I had no answer.

Sure, I had theories. I always have a theory. A good friend called me out on this, fifteen years into our friendship. I was regaling him with some forgettable tale about personal growth, and he listened with patience and bemusement as I concluded with the immodest judgment that I’d changed so much that I must be unrecognizable as the person he met a decade and a half ago. He replied, “Well, there’s one thing about you that hasn’t changed, that was clear from the day I met you, that is perhaps your defining characteristic: You always have a theory. And you express your theories with a visceral passion. A few years later, you might have a completely different, possibly even mutually exclusive, theory. But you’ll have a theory, and you’ll believe it with all your heart.”

I can’t decide if that’s a sparkling insight or an acerbic insult, and I can’t deny its truth. I sat with that truth for another five years before I realized: “Hey waitaminute. I’d rather always have a theory, and always change it, than always be in a perpetual state of confusion. In either case, there’s no real answer, so I might as well be excited about the illusions along the way.”

That’s the background to this momentous event: I’m changing the tagline of this blog from “the way of ginsu” to the shortest statement that I can make of what has really become my way, after all these years of searching. I may have believed a lot of things over the last dozen or so years, but I didn’t believe any of them strongly enough to make it the meaning of ginsudo. I like to think that underneath all of the other theories I have ever had about life, this statement is the purely distilled expression of the true meaning of them all. So here is the latest, and greatest, expression of my way:

At the base of every argument is the irrefutable fact that there is only one thing that everyone agrees upon.

Now, I don’t mean to be coy about what that one thing is: “I think that I am thinking, right now.“ Everyone agrees that this is a thought that must be in your head as you think anything else. A few people would say that this is the only thing that everyone must acknowledge is true. Whether or not it’s the only thing, it is certainly irrefutable.

There are only two ways to object, and both of them are inadequate to the task.

One objection comes from the land of science fiction, or perhaps from sciences so far advanced that they seem like fiction. This objection says that it’s likely we’re not at all what we think we are, that the odds are likely that we’re simply living in a simulation. Perhaps nothing is real at all. This objection is irrelevant. Even if it is true, the simulation creates in you the thought that “I think I’m thinking, right now” – you could say that’s actually the test of a successful simulation.

The other objection comes from either sophistry or deep insight – as diametric as these are, it’s often difficult to tell the difference. But in either case, the objection is simply, “So what? It’s a trivial observation.” The deep expression of this objection goes on to say that the sense of self is an illusion, consciousness is a human construct, all outcomes are deterministic (or “fated”), so thoughts are merely distractions from a more important truth. But I never said that “I think I’m thinking” is the most important truth, even if it is the only one that everyone agrees upon. In fact, I’m saying that this truth is the gateway to many deeper truths, which is perfectly in accord with this line of putative objection.

So the interesting claim of ginsudo is not the actual fact that everyone must agree upon. It’s the idea that this fact is at the base of every argument. In the most grandiose statement of my way, I’m claiming that I’ve found the bottom turtle.

This comes from the apocryphal tale of a famous scientist explaining cosmology to an audience. After the lecture, one elderly lady approaches the scientist and says, “Your lecture was hogwash – how can anyone believe that the earth simply exists in the universe without any support beyond your mystical claims?”

The scientist asks, “Well then, what do you suppose supports the earth?”

She says, “The planet rests on the back of a giant turtle.”

The scientist responds, “Alright then, what supports the turtle?”

“An even larger, more grand turtle.”

At this point, the scientist is sure she’s trapped: “And then? What’s beneath that grand turtle?”

She exclaims triumphantly, “You silly goose, it’s turtles all the way down!”

In stating my way, I’m revealing many things about myself, but there’s one thing that people who know me already know too well: I’ve been in a lot of arguments. I’ve been in arguments with people who love me, people who hate me, people smarter than me, people with an exasperating inability to understand even the most basic tenets of argumentation. I’ve been in arguments with my bosses, my employees, my peers, my friends, my lovers, my children, and way too many people on Twitter.

What I’ve learned from all these arguments is that most people in arguments aren’t trying to win the argument. They’re trying to say something about themselves, say something about the other person, say something about the world or about life or about the universe and god and everything. But if you are trying in good faith to get to the truth in any argument, there is always one technique that you will try, and that is to seek a place of common agreement that precedes the argument. Almost always, this means that you try to find the nearest place where you agree.

That means, for example, that if you and I are arguing about who to vote for in the next election, we might argue about economics or immigration or globalism or socialism – and we might find that we’re making no progress. If we want to make progress, we seek the nearest place where we have a common goal, usually something like: “We want the best outcome for this country.” But maybe we find out that isn’t our common goal. Maybe one of us says, “What do you mean, ‘our country’? I want the best outcome for humanity first, our country only a distant second and only to the extent that our country can affect the future of humanity.” It’s interesting to find a place like that, where you thought you must have a common point in your argument, but actually, there’s a deeper foundational point that you must discuss first.

What I’m saying here is that it’s not enough to start from the nearest foundational point. The foundation under all foundations, the last turtle in the entire stack, is in not the nearest but rather the deepest point: that there is only one thing that everyone agrees on. The idea that “I think that I am thinking, right now” is the only thing that you must agree on is both freeing and compassionate. It frees you from every assumption you were making about what the other person must agree upon. It forces you to understand that you diverge from your counterpart in this argument somewhere after this base agreement, and there is absolutely no rule that requires that the divergence take place in any particular place above that bottom turtle.

This truth gives you enormous power, which you will probably never choose to use. If you had the time, you would build up from this base, instead of simply finding the nearest point of agreement. A stable bridge cannot be built simply as a quick connection between the nearest shores across the water. Instead it must be anchored deep in the foundation not only of both shores but deep underneath the waters. So in arguing with someone, if you really want to understand your disagreement, you would start from the foundation that the only thing that you must agree upon is that each of you is thinking, “I’m thinking, right now” – and you would try to draw a line from that thought to each other, finding where you disagree along the way.

For all practical purposes, you would have neither the time nor inclination to do this with every person you would want to argue with. But simply knowing that this is the base, that you would have to work up from this base if you really and truly want to resolve your argument – that knowledge would curtail a lot of your desire to argue in the first place. 

That is my way, if not in practice, always in theory.

bottled up

~ ginsu ~ 2 Comments

When I first started getting glum about the future, I thought that maybe I was just getting old and grumpy. But now I’ve noticed that an increasing number of people are concerned about the direction we’re all heading. In fact, it seems that the younger you are, the more likely you are to have some pessimism about the planet, at least to a point. And that point depends on your understanding of basic ideas from biology and sociology. This understanding doesn’t have to be so great: a little knowledge is a sufficiently dangerous thing, as I will surely demonstrate here. It’s not climate science that’s depressing – it’s the science of people.

This book review recounts an analogy that provides a good starting point: Imagine a bottle containing a population of bacteria that doubles every minute. The population growth starts at 11am, and the bottle is filled to capacity with bacteria by noon.

First question: What time was the bottle half full?

The math is not hard on this one. Since the population doubles every minute, the bottle was half full at 11:59am. In the next minute, the bottle was totally full, and without another bottle to expand into, all the bacteria died soon after noon, as the bottle was a constrained and exhausted resource. Even if another bottle miraculously became available, that bottle would be full in one minute, and two more bottles would be required just to survive the following minute.

Next question: Assuming the bacteria were as smart as humans, what time did they all realize that the bottle was going to fill to capacity?

No matter how highly you rate human intelligence, it would be a stretch to think that they would realize the overcrowding before the last 10 minutes, at earliest. With 10 doublings to go, the bottle still has 99.9% of its space available. Even with only 3 minutes left, the bottle still has 87.5% of its space remaining.

Next question: Do you see the obvious analogy?

This analogy purports to explain climate change denial, and as far as it goes, it’s not terrible. It’s often noted that 200,000 years passed from the beginnings of humanity to a population of 1 billion people, and only another 200 years to reach 7 billion. To me, it’s striking that there’s been a doubling in my lifetime – when I was born, there were barely 4 billion people on the planet. Now the world population is almost 8 billion. Whatever room there is left in this bottle is going to disappear very fast.

I’d like to extend the analogy with another question, which speaks to the structure of our society today and in the future. There’s no math in this question, but there’s a lot of underlying sociobiology, which is a word that I don’t really even understand – I had to look it up a second ago just to feel confident enough to use it here. It seems like the right word for someone who’s flinging analogies about social structure and natural selection.

New question: What if there’s more than one type of bacteria?

Let’s assume that Population A consists of bacteria that are, with respect to their relationship with each other and the bottle, a kind of ideal that many of us aspire to as humans with respect to each other and our planet. They are peaceful, cooperative, inclined towards equality, and harmonious with the natural resources they consume within the bottle. They’re never going to fill the bottle – they trend towards an equilibrium where they don’t compete with each other, and they tend to move on to a different section of the bottle when they’ve lightly used the resources in the place they were in.

Population B are bacteria that are highly competitive, to the point you would call them warlike if they were people. But they are also organized, disciplined, communicative, and inclined towards freedom. These bacteria might be kinda assholes, but they’re not going to fill the bottle either. When their population grows past a certain point, they tend to split into groups so they can maximize freedom for each member of the groups, which then go to war against each other. This trends towards population equilibrium as well.

Now imagine a Population C as a nightmare evolution with the worst characteristics of A and B. They are highly competitive and organized, they’ll grant equality only to their own kind, and they express their freedom through the exploitation of others, which both enables and requires the use of continually more resources. They’ll subjugate A and use the resulting superior resources to defeat B. These are the assholes that end up doubling the population every second.

I am stretching this analogy to its breaking point, but this is basically the story told in books like Sapiens and Against the Grain. The earliest organized human societies lived as hunter-gatherers, roaming wherever they wanted to explore the gifts of nature, working only as much as they needed to eat, which was about half their daylight hours, and playing around all the rest of the day. When humans ended up settling down in agrarian societies, they didn’t do so because they were tired of all the travel and leisure, they did so because of the inexorable logic of exploitation and population growth. Farms were more successful with more children, and eventually more scalable with trade, finance, serfdom and slavery. Agrarian societies could leverage their advantages through exploitation – underpaid labor and outright slavery allowed a smaller and smaller proportion of the population to reap more and more gains. Eventually Population C (agrarian society) absorbs Population A (hunter-gatherers) and kills Population B (let’s say Neanderthals).

The Agrarian Era gave way to the Industrial Age which then gave way to our current Information Economy. But these all enable and require the same social structure – they are a continual evolution that naturally entails a smaller and smaller proportion of society having more and more of the wealth, while at the same time crowding out any possible other form of social structure. Now that human society has reached global scale, it’s laughably egotistical for us to think that we ever had a choice to organize our global society any other way. Exploitation of the masses by the elite isn’t a choice, but an evolutionary outcome from which there is no escape. Not until the bottle explodes. Or until the elites replace the masses with robots. I would say “pick your poison” but you’re not really going to have a choice.

Speaking of ego, this fantastical conjecture would also explain one of the enduring mysteries of humanity: the existence of consciousness. So far, we have no conclusive explanation for why humans are conscious of their own experience in a way that no other animal seems to be. Even if we could explain exactly how it works (we can’t yet), we don’t know exactly why it exists. I believe that consciousness is an evolutionary adaptation – not for any individual human, but for the propagation of ever larger human societies. Without a sense of ego, which requires consciousness, no human would be able to live in a vastly exploitative society.

Humans aren’t like ants or bees, living in societies where the masses can mindlessly support the evolutionary imperatives of a single queen. Humans have the intelligence and tools to live a life of freedom. On an individual level, there’s no reason for any of us to accept a social structure where we’re not all equals. It’s only the fact of ego allows people to conceive of themselves as members of a great society, and the disorienting thing is that ego doesn’t necessarily mean you think a lot of yourself. The ego of a very few might compel them to strive for status among the elites. But that effect of the ego is far less important than its much more pervasive opposite effect, the ego that convinces people that there’s a reason to go on living under conditions of outrageous and inescapable exploitation. There would be no oppression without consciousness, and there would be no global scale without oppression. We were always doomed by our egos to fill the bottle to bursting.

If in recent times, you’ve found yourself struggling with the creeping feeling that there’s something about our species that means everything will only get worse until the end of our time, which doesn’t seem very far away … well, at least you can congratulate yourself on your instinctive awareness of sociobiology. If nothing else, it’ll help your ego.

over easy

~ ginsu ~ 3 Comments

Although being a visionary seems fruitful, you never want to be too far ahead of the times. When you can predict the future very far ahead about something that’s very important, the more fervently you behave in accord with that prediction, the more of a lunatic you will seem. An clear example is that all of our best knowledge about cosmology indicates that the universe will end at some point in the very distant future; however, if you’d spent your whole life screaming that the world is coming to an end, you’d seem like a nutter. If you’ve only been whimpering about it in the last couple of years, you seem … almost rational? Timing is everything.

Resurrecting an old idea at the right time looks like genius. In 1993, Apple introduced a personal handheld device that would be your constant companion, storing all sorts of your useful information and contacts so that you could always carry your digital world with you. When Steve Jobs returned as CEO of Apple in 1997, he killed the project. In 2007 he introduced the iPhone and changed the world. Steve Jobs wasn’t a better visionary than John Sculley; he just had better timing.

So really what you want to be is slightly ahead of the times. What does that look like? You’d know it when you see it, and then see it again. See, you can only be sure that you’ve seen a prescient idea after you have looked at it at least twice. The first time you look at it, it looks like the work of a lunatic. The last time you look at it, it seems utterly sensible, though you may still have your doubts.

Yesterday I came across The Easiest Person To Fool, but realized that I’d come across him years ago – and at that time, I’d dismissed him as a nutter. Irv Mills may describe himself as a “collapsenik” rather than a prepper or a survivalist, the latter terms sometimes having the tinge of overzealousness to them – I don’t think that the distinction between any of those terms is important for my purposes, as the mental image for all of them is basically the same to the uninitiated. The point is, when I read Irv’s website a few years ago, he sounded a bit crazy to me. He seemed to be living an isolated life in the woods, obsessively preparing for a disaster that might never come.

But yesterday I took a closer look at his autobiographical notes. He’s just a normal guy, nothing nutty about him. He worked in the energy industry for years, developing a detailed understanding of the limits and consequences of carbon-based fuel sources. As he aged into retirement from his first career, he noticed the fragility of our financial system and the precarious consequences for his children, and he thought longer and harder about the state of the world. By 2006, he concluded that it makes sense to start preparing for the collapse of civilization. That sounds dramatic, but when he lays out his thoughts on “business as usual” and hippies and magical thinking, he comes across as a very deliberate and rational thinker. He comes across as almost trendy, actually.

Apocalyptic thinking is very much on trend now. The world seems to be on the verge of a breaking point. Climate change, structural economic instability, tech disruption, authoritarian politics, trade wars, shadow digital wars, real “hot” wars … we seem to be in a constant bath of troubles that’s about to boil the frog. Apocalypse, zombies, and dystopia are such common features of our mainstream entertainment that they’re beyond cliche now. People who once seemed like hermetic nutjobs now seem … entirely rational?

In politics, the mainstream viability of an idea exists in the “Overton window” of formally supported policies, popular behavior, and sensible choices. The range of acceptable political discussion moves with the times, ascending through various degrees of public acceptance. Here’s an example on the topic of human sexuality.

1965:

  • Policy: heterosexual marriage
  • Popular: premarital sex
  • Sensible: premarital cohabitation
  • Acceptable: contraception
  • Radical: abortion
  • Unthinkable: same-sex marriage

To be clear, the Overton window is just a description of what is currently considered sensible (and above) in mainstream political discourse; it’s not a value judgment on whether that sensibility is right or wrong. Even with that caveat, your mileage may vary depending on where you live and who you associate with. I would roughly say the window on these issues moved like this:

1975:

  • Policy: premarital sex
  • Popular: premarital cohabitation
  • Sensible: contraception
  • Acceptable: abortion
  • Radical: same-sex marriage

1995:

  • Policy: premarital cohabitation
  • Popular: contraception
  • Sensible: abortion
  • Acceptable: same-sex marriage

2015:

  • Policy: contraception
  • Popular: abortion
  • Sensible: same-sex marriage

Moving from sex back to the end times: Now, everyone should have some degree of preparation for disaster, but there’s sort of an Overton window for disaster prep as well. If you live in a stable society with no special history of natural disaster, maybe your Overton window for prepping for disasters looks like this:

  • Policy: fire alarm
  • Popular: fire extinguisher
  • Sensible: earthquake kit
  • Acceptable: power generator for a day or two
  • Radical: a year’s supply of food and water
  • Unthinkable: bomb-proof shelter

It’s possible that I’ve inadvertently joined the Tinfoil Hat Of The Month Club, but I’ve come to believe that there’s almost nothing outside of the Overton window for the collapse of civilization. At most, we could have a discussion about what’s on either side of the border between sensible and acceptable. Are you prepared to go a week without power from the grid? That’s totally sensible in most places, and it should be popular where I live in California. Have you stockpiled weapons because you’re concerned about the breakdown of civil order including the law enforcement response to that breakdown? That seems acceptable to me. Do you have a detailed escape plan covering you and your loved ones? Sensible. Growing food in a kitchen garden? Canning? Keeping backyard livestock? Popular. Put your life savings in Bitcoin? I mean … I still think that’s stupid, but it’s nevertheless totally acceptable.

You might think I’m crazy, or you might think you’ve been smelling what I’m cooking for a while now. Either way, it makes sense for you to consider the gifts of the collapseniks. After spending some time with Irv, I followed some links from his blog to Albert Bates, who charts other collapseniks, and Dave Pollard, who offers a map you can easily find yourself on and a great reading list. Go ahead and click around a bit. You might think I’m crazy, but I think that with the road we’re on, I’ll keep this going ’til the sun goes down forever.

what we talk about when we talk about electability

~ ginsu ~ Leave a comment

What does it mean for one candidate to be more “electable” than another? Some people object to even posing this question, arguing that “electability” is just a cover for maintaining the status quo, generally favoring dominant class, race, and gender patterns. In other words, by “electability” many people just mean that they want a candidate that most resembles prior successful candidates, and since the vast majority of prior successful candidates were older, white, male, and centrist – to be electable often just means to be an old white man from the political center.

But when we talk about electability, we’re not just talking about the qualities of the current candidates. We’re really talking about what happened in the last election. We want someone that’s not prone to the same dynamics that lost the last election. That’s really challenging today, because over three years after the last Presidential election, there isn’t broad agreement about what happened. The three prevailing theories are:

  1. Bigotry. This theory says that Trump supporters are fundamentally motivated by racism and sexism.
  2. Economic despair. This theory says that the hollowing out of the middle class has led to sentiment against immigration, free trade and rapid modernization.
  3. Media dysfunction. This theory says that both intended (by Russia) and unintended (by BigTech) consequences of modern media distorted the election results.

The easiest opinion to hold is “It’s a combination of all of the above!” But most people who claim to hold this opinion secretly believe that only one of the three is the truly critical reason for the result of the last election. Often this is a secret even to themselves, but the truth is revealed by your opinion on who is really the most electable candidate.

If you think Biden is the most electable candidate, then you think that bigotry was the critical factor in the last election. Biden is the old white man from the center, and despite his high approval among black voters, he also was a main proponent of harsh criminal laws that disproportionately harmed black people, so he looks safe enough to many bigots. This is the right profile to sway bigoted swing voters. You tell yourself, “He’ll win if he can just avoid shooting himself in the foot.”

If you think Bernie is the most electable, then you think that economic despair was the critical factor last time. All those poor hollowed out voters they keep interviewing in diners should love the economic message that Bernie has been consistently espousing for decades. Doesn’t hurt that Bernie is old, white, and male – but if you thought that does the trick, then you would go with Biden. You go with Bernie instead because he’s got the loudest, clearest message about fundamental economic change. You say, “He’ll win if he can just avoid being tagged as a socialist.”

If you think Warren is the most electable, then you think that media dysfunction is what really drove the last election. She’s the smartest, the most accomplished in both pre-politics career and national legislation, and a member of the largest identity group (women). This time around, the Russians will still be a factor, but if we can only police the mainstream media enough to get them to concentrate on substantive policy positions, then Warren’s policy and legislative record should win the day. “She’ll win if only she’s portrayed fairly.”

By the way, if you think Buttigieg is the most electable … keep thinking. Maybe he’s the candidate for those who really do think the last election was the outcome of a perfect balance of the three reasons. You think that bigotry won’t hurt him too much, since he’s white and male, and even though he’s gay you think the country’s sentiment has changed enough so that it’s a non-factor for bigots. You think he can navigate the discussion of economic despair by simply smooth-talking the issues without troubling his biggest donors. You think the media loves him, and will continue to treat him with kid gloves. These are delusional thoughts. The reality is that Buttigieg is vulnerable for all three of the reasons in the prior election: Bigots really are bigoted, including against gay people. Buttigieg is clearly a proponent of the economic status quo, anyone in economic despair will see right through him. And the media will turn against Buttigieg, in part because that’s just want they do, but ultimately it’s because there’s no there there. He was the mayor of a small city, with zero national exposure. That’s even less qualification for national office than a reality television star. Trump would destroy Buttigieg in a landslide.

As a reward for reading this post, let me remind you of what we talk about when we talk about love. It’s a good read, somehow both hopeful and disheartening, and strangely resonant to peruse after pondering our current politics.

from Linden to Libra

~ ginsu ~ 1 Comment

Join me, friends, in the Wayback Machine …

In 2007, Facebook sent a couple of strategists to Linden Lab to ask us about virtual currency. Of course they would ask us – at the time, we were the world’s leading experts in managing a virtual economy, heading towards a billion dollars of L$ transactions. Yes, that’s a billion real US dollars – unique among all virtual currencies at the time, we supported the exchange of L$ to real US$, so our virtual currency had real world value.

When we heard that they wanted to meet, my colleagues huddled in a room to decide how much we should tell them. We decided to emphasize the difficulties of managing a virtual currency: complexity of implementation, responsibility for users’ financial transactions, intrusive governmental inquiry and oversight, competitive dynamics with banks and payment partners. We went into the meeting and told them this story about how terrible it all was, and how they’d be better off simply issuing credits paid for with real money.

We never heard from them again, but in 2010 they launched Facebook Credits. I laughed at the thought that it seemed our little misdirection had worked – they went down a path that was entirely uninteresting and ultimately untenable, just as we’d hoped. Yeah, I know: that was kinda evil. But at the time, I was just a little evil, trying to stay ahead of bigger evils.

Why didn’t we want Facebook to work on virtual currency? Because I believed that the Linden Dollar was the greatest innovation created by the Lab. Sure, the 3D virtual world was mind-bending – all the avatars and the world building and the art and the boob physics – but for me, the virtual currency was the one element of Second Life that had the opportunity to break out of SL and into prominence in the whole wide world. Facebook had only 50 million users in 2007, and I didn’t want them to get their virtual currency right, so early in the game.

Well, it’s a dozen years later, and blockchain inspired a Facebook exec to figure it out. Facebook has launched Libra, a new cryptocurrency. It is a brilliant implementation: meticulously researched, expertly engineered, broadly partnered, poised for global domination. There’s only two problems: it’s too late, and they’re doing it wrong.

The right time for Facebook to launch a virtual currency would have been, oh, around 2007. That’s right: I’m saying you can thank me and Chris Collins for talking them out of it at the time. As I’ve written previously, a cryptocurrency can only succeed as a medium of exchange if it is a core currency of a powerful platform. Don’t even get me started on Bitcoin. What I didn’t call out in those posts is that the platform must implement currency strategy early in its growth. This is because when you are messing around with payments, you are in a field of giants – global banks and entire nations that have a vested interest in preventing your success. You have to implement your new currency while your platform is still small enough to ignore, or at least dismiss as “merely a game.” Then when you reach enormous scale, it’s too late to do anything about the economy that’s been baked in since the early days.

When a platform already has billions of people, it’s not going to fly under the radar. Facebook is already seeing immediate regulatory interest in Libra. Even with less than a million users, Second Life had to deal with aggressive regulatory interest from Congress and international bodies. I like to think that we talked our way out if it with my silver tongue, but the truth is that we were too small for sustained inquiry. Facebook is far, far, far past that point. Libra will be hounded by regulators until the cost outweighs the benefits.

The part that Libra has wrong is its reserve policy. This is getting into the weeds of managing virtual currency, but to vastly oversimplify: the reserve is a guarantee of currency redemption. If you buy Libra with real currency, you can sell it back to the Libra consortium for a relatively stable amount of real currency. Libra has launched this way in the hopes that a stable currency value will engender trust. The amusing mistake here is that only in the insular world of technocracy could someone believe that Facebook has consumer trust problems that can be cured by a stable rate of exchange on their cryptocurrency. The more serious mistake is that requiring a full reserve limits the utility of the currency.

All major world currencies are fiat currencies, which means that they can be issued at the will of the governing authority. They are not backed by gold or any other asset – though nearly all of them started out backed by a guarantee of redemption in gold. But there is a reason that all of them have moved off of the gold standard: fiat provides the maximum flexibility to manage the currency and its related economy. While it’s true that fiat currencies are more susceptible to hyperinflation, that is only a consequence of bad management. If the manager (i.e. the government, or in this case, Facebook) can be trusted to make good economic decisions, inflation is a limited risk.

Perhaps Facebook is aware of all this, and their plan is to launch with a full reserve, but later evolve into a fiat currency, after some history has demonstrated their trustworthy stewardship. After all, this is actually how all the major world currencies developed: first on the gold standard, then eventually declaring a switch to fiat currency. So if the launch with reserve is a bit of knowing subterfuge, kudos to them.

At this point, I could launch into an extended discussion about the relationship between virtual currencies and MMT. But I’ll leave that exercise for another day. In the meantime, for Linden historians who have stayed with me this long through the discussion, I’ll give you a little blast from the past: a record of posts from Linden Lab as we decided how to think about our currency, and whether to implement fiat sales of L$ into existing exchanges. Enjoy!

why warren

~ ginsu ~ 1 Comment

I’m absurdly proud of having predicted Trump as President, more than two months before the Republican convention, and six months before the general election. I know of only two earlier public predictions, by a professional pollster two months before me and a cartoonist extraordinaire more than eight months before me. Ah, but pride goeth before a fall, so let me jump off that cliff now, by making my prediction eighteen months before Election Day: Elizabeth Warren will win in a landslide. (btw, if you’re going to comment now or later on why I’m wrong, do me a favor and include the link where you called the results of the 2016 election beforehand. Oh, you have no public record of that? Then shush, you.)

The Democratic nomination will come down to Sanders or Warren. But first, let me give the two-sentence dismissal of all the other nominees:

  1. Biden: He’s the last bastion of the Democratic establishment. But the machine is crumbling, and he has too much history to overcome.
  2. Buttigieg: He’s the flavor du jour, but lacks substance. Personality can win against substance, as we’ve seen time and time again, but his personality isn’t actually strong enough.
  3. Booker: America isn’t ready for its second black President. And if it were, Booker’s “love” campaign isn’t the right tenor this cycle.
  4. Harris: A black woman president is two bridges too far for most of this country. And she’s hindered by her record as a prosecutor.
  5. O’Rourke: Beto has already flamed out. If you’re running the Kennedy playbook, you need to actually be a Kennedy.
  6. Castro, Delaney, Gabbard, Gillibrand, Hickenlooper, Inslee, Klobuchar, Messam, Moulton, Ryan, Swalwell, Williamson, Yang: No. Too far behind, nothing distinctive enough for them to catch up.

Let me be clear: I don’t want any of the above to be true. I’m just saying I think it is true, and mere wishes otherwise aren’t going to win this horserace.

Sanders and Warren might seem similar. They’re both old, white, and progressive. But they have one starkly obvious difference – no, not that one is a man and the other is a woman – one is a socialist and the other is a capitalist.

Sanders is a democratic socialist, and proud of that label – and deserving of both the label and the pride. A lot of the country has come around to positions that he has been espousing for his entire professional life. Warren wouldn’t label herself this way, but she’s a democratic capitalist – she believes in market mechanisms to address many social problems, but believes the market must be firmly guided by the best interests of a democracy.

At the end of the day, as much recent fervor as there’s been for socialist policies, this country isn’t going to elect an avowed socialist as president, at least not yet. Warren’s policies and her effectiveness in getting them into the discussion will win both the media and the electorate to her side. She won’t be hindered like Hillary was by either her past or by forces she doesn’t control. The distortions of the prior Presidential election can be summarized as: sexism and Russia. Both will continue to have an effect, but that effect will be much smaller than the prior election, due to countervailing forces that have arisen in the meantime.

Once Warren wins the Democratic nomination, she’ll crush Trump in a landslide. I’ll go over the rationale for this … in about eleven months. By Super Tuesday, if this post has any legs, it’ll be worth writing the follow up. And if it’s wrong, well, pride is a sin anyway; I shall repent.

the story of the end

~ ginsu ~ 1 Comment

This week’s first-ever picture of a black hole was captured by the Event Horizon Telescope, which is named after the critical boundary around the black hole. Once an object crosses the event horizon into the black hole, it will never be seen again by any observer on this side of the horizon.

The pictured black hole is fifty-five million years away, and that’s only by traveling at the speed of light. We seem to be much closer to another border beyond which there is no return, one that deserves the melodramatic name of The Apocalypse Horizon.

The world will end someday. There is no serious dispute about this fact, only a question of when. And that question seems unimportant for nearly all of us, as the end is at least several billions of years away. The Sun will expand until it engulfs the Earth, consuming whatever is left on the planet in a giant mass of red fire. No student of the universe disagrees with this, other than the few who believe that the end is even further away, with the Earth remaining just outside of the swelling Sun, surviving only to eventually collide with the Moon and then spin out to a cold death in the infinite cosmos. If that happens, it would be about a billion billion years from now. Those aren’t the only two stories: there are a few radicals who believe that instead of spinning away into the infinite, the dead husk of the Earth would eventually collapse back into the cold remnants of the dying Sun, which would take about a hundred times longer than a billion billion years.

No one can really fathom that amount of time, none of us have to worry about that end. So the fact that the world will end isn’t particularly compelling – but our lack of interest is only partially because the distant outcomes are so far beyond our capacity to envision. The disinterest is really driven by over-repetition: we’ve lived with stories of the end for about as long as we’ve had stories. There is always someone raving about the end of the world.

As a child I saw the modern ur-form of this storyteller with my own eyes, the lunatic in Times Square, disheveled in a stained trench coat and torn denim jeans, holding high a hand-lettered sign with the classic message: “THE END IS NIGH.” Even as a child I knew that he had nothing interesting to say about the end of the world. Urgency is always combined with a call to action, but the message is really about the desired action, and the story of urgency is provided only to give reason to take the action immediately. “REPENT!” The meaning and path to salvation was the story this prophet really wanted to tell; the cries of apocalypse were just a ploy to get anyone to listen.

What was the first story ever told – and why was it told? This must have been at least tens of thousands of years ago, around the time we first became capable of abstract thought. Some of those first stories must have been about food or shelter or sex. But I feel certain that on the day after the first person looked up into the sun and recalled that the sun also rose yesterday, there was some other person there to tell a story about why there would be no sun tomorrow nor any day afterwards. And that storyteller was telling the apocalyptic story to get the audience to do something. The story of the end was never really about the end, but about what the storyteller wants the audience to do now.

That is how it has been throughout all of human history, and that is why the savvy listener disregards apocalyptic tales today. The end isn’t coming unless it’s the one that’s too far away to matter. That’s the way it has always been. Anyone who tells you any different wants something from you.

But that will only be true until the day that it isn’t. The inevitable end of the Earth may be in the unreachable cosmological distance, and all of the old stories may have been diversions – but we now live in an age where humans have planetary impact of a scale that inarguably includes the ability to end all of humanity. In the simplest apocalyptic story of our times, the collective nuclear arsenal we’ve built is more than sufficient to make the planet uninhabitable. That wouldn’t be the end of all life, and the planet itself would continue on its many-billion year journey without us, but the end of humanity deserves a name, and the best one we have is Apocalypse. The term may be dramatic and it may be stained by thousands of years of misuse, but we have no better word for describing not the end of the planet, but the event that ends our time on it.

I don’t ask you to believe in any particular form of the Apocalypse. There are plentiful stories for whatever belief system you ascribe to – you can pick and choose among nuclear holocaust, environmental collapse, killer robots, infectious superbugs, or even good old fashioned Wrath of God. The point is that for the first time in human history, some of these apocalyptic stories might actually be true. And although most of the people telling you these stories probably want you to do something in reaction, unlike all previous times, the real story isn’t the desired action, but is actually the question of whether or not this particular story of the end is a true story.

All of the stories with a scientific basis have a point of no return well before the actual end, even though that point may be impossible to identify with current science. There is a point at which fissile material and nuclear technology will be so broadly available that avoiding disaster becomes improbable. There is a point at which the oceans will rise so high that areas now populated by millions will be underwater. There is a point at which the intelligence of machines will allow them to create more intelligent machines. Once those points are past, there is no going back. Those points of no return form our modern Apocalypse Horizon: the point past which we cannot prevent the end of all of our stories.

If you believe in science, you must believe that we will eventually cross the Apocalypse Horizon, and it’s possible that we have already done so. In our modern apocalyptic stories, the time between the point of no return and the storied end is about three generations. This span of parent to child to grandchild is crucial: If we are near the horizon, that means that people who are in their reproductive years today can feel confident that they and their children can live a long life before the Apocalypse occurs – but they’ll have to tell their children that their grandchildren are not likely to live out their natural lives. Or they’ll need to make up stories that are the opposite in substance but similar in purpose to the apocalyptic tales of the past: falsehoods designed to lull a doomed generation into acceptance of their unchangeable fate.

Are we the generation that lives just prior to crossing the Apocalypse Horizon? Even the possibility means that people with children in their lives might think differently than any generation before about how to discuss the future. All prior generations could simply ignore the stories of the end, as it had always been rational to do so in the past. All future generations will be past the point of no return, so will be beyond the point where choices about future generations matter. Only the generation that crosses the Apocalypse Horizon really has a decision to make about what to tell their children.

This is no entreaty to repent, I have no story of salvation to sell. This week we saw something that has never been seen before in human history, though it existed fifty-five million years ago; it is an apt time to reflect on our existence in the universe. The stories that have never been true before must now be taken seriously, for ignoring them no longer serves the truth, but furthers a lie. The Apocalypse Horizon is near enough to see, and in a sense it hardly makes any difference whether it is just in front of us or just behind us.

celebrated people

~ ginsu ~ Leave a comment

p. 96:

I keep it always full of interesting people, night and day.

When you live alone in a feudal mansion, with gardens spuming the sparkling odor of jonquils and the frothy odor of hawthorn and plum blossoms and the pale gold odor of kiss-me-at-the-gate, how do you mask the inescapable stink of loneliness? What pulsating energy could pierce the hardened cocoon of disaffection to warm a heart made cold with mysterious wealth?

There’s no better distraction than the whirling carnival of people crashing a party where everyone and no one really belongs. Let the folly of others be a movie for which you’ll gladly douse your illumination in favor of sitting in the dark with your attention devoted to anyone else’s story, anyone at all so long as it isn’t you. If the others are just interesting enough, perhaps they can be elevated to a celebrity that attracts the curiosity of those who can be fulfilled by nothing more than being hopelessly curious about a celebrity. Then you can be alone with many birds of a feather, packed together in a frenzy of distance, locked in a solemn vow never to connect. It’s best that way for everyone involved.

Gatsby couldn’t be sure that Daisy would be interested in him. He hardly knew what he was himself, consisting of no substance other than blindered ambition. He had no sensical idea of what an interesting person could be, other than to accept the judgment of others conferring the crown of celebrity. So he filled his house with interesting people, celebrated people, all gathered to have the time of their lives, or at least avoid the fear of missing out.