Stephen Laniel’s Unspecified Bunker

Every article about the recent Turkish crises feels obliged to mention that there’s some sort of battle happening between Islam and secular government. Far be it for me to suggest that this is a way to fit an unfamiliar environment into a convenient Western narrative, but: this is a way to fit an unfamiliar environment into a convenient Western narrative. Take the New York Times story on today’s development:

The case had paralyzed Turkish politics since the indictment was filed in March and had moved Turkey to a final confrontation between religious and secular Turks about who will rule the nation.

The indictment before the court accused the governing party, Justice and Development, known as A.K. for the initials of its Turkish name, of trying to turn Turkey, a secular democracy, into an Islamic state.

I am no expert on Turkey, obviously, so please take everything I say here with ample salt. But it is not our culture. In Istanbul, the most “Westernized” city in all of Turkey (or so I’m told), you hear Muslim calls to prayer five times a day. There are mosques every few blocks.

Maybe the shortest way to get to my point is to ask: wouldn’t it change the Times’s story somewhat if they noted that Turkey is 99.8% Muslim? 99.8%. That is a degree of religious homogeneity that American conservative Christians could only dream of.

It’s nonvacuous, despite that, to say that Turkey is officially secular. It could be that the governing Muslims don’t let their religion influence their governance. Or it could be — the article doesn’t completely make it clear — that the 0.2% of the country that isn’t Muslim are the only people allowed in government. If that second option is true, that doesn’t seem like something we should be cheering; do we really respect “democracy” when it’s democracy of a highly unrepresentative sort?

While in Turkey, I realized two things that I really need to learn about:

1. This unending belief in the West — which seems to have started back when the Ottomans were attacking the Holy Roman Empire — that there is a war between Islam and Christianity. Even if the Islamic warriors are tiny and essentially powerless terrorist groups, with no practical ability to topple the West, this narrative continues.

2. Nationalism. The Ottoman Empire seems to have been a heterogeneous brew of ethnicities that, if you read A Peace to End All Peace, wouldn’t be recognizable as a “nation” in the sense that 21st-century Westerners would understand that word. It tolerated Jews alongside Muslims alongside Armenians alongside Turks. Suddenly there came a point when the “Turks” recognized themselves as such, killed off those who weren’t “Turks,” and booted the rest out of the country. I recall reading in Pamuk’s Istanbul that more Jews left Turkey in the half-century after independence than left it in the half-century after the Ottoman takeover. (This could just be a statistical sleight-of-hand owing to a larger 20th-century population, of course.)

   How do you convince people that they are in this group, those guys are in the other group, their group deserves death, and your group is special because of (inter alia) its language? Certainly some variant of this has been going on forever (I’m thinking of the “shibboleth” story from the book of Judges, 12:4-6), but … something about Turkey is special here. Understanding nationalism means understanding Turkey, and probably understanding the latter would buy you nearly all you need to know about the former.

P.S.: Before anyone mentions it: yes, rereading Hobsbawm wouldn’t hurt.

Paradise Lost was a rough slog for me; I think I got through half or 2/3 of it before abandoning the enterprise. Nowadays I’d do better, because I’ve developed some skills at reading unpleasant books. (Witness my current read, Diarmaid MacCulloch’s The Reformation.) But still, I’m not inclined to dive back into Paradise Lost; as Dr. Johnson put it,

Paradise Lost is one of the books which the reader admires and lays down, and forgets to take up again. None ever wished it longer than it is. Its perusal is a duty rather than a pleasure. We read Milton for instruction, retire harassed and overburdened, and look elsewhere for recreation; we desert our master, and seek for companions.

But Milton was great for other reasons, I gather. He was an important player, somehow, in the English Civil War, and people still cite Areopagitica. Can anyone out there point me to a good compendium of non-Paradise Lost Milton?

One thing I’ve also realized recently is that reading the original texts without commentary is nearly pointless. This is something people have told me for a while about legal texts: yes, there’s value in reading Court decisions, but you really do need someone to embed that decision in the context that makes it important. Something similar is surely the case for Milton, as it is for any important Christian (Origen, Augustine, Aquinas…).

Has anyone tried the Cambridge Companion to Milton?

If anyone out there has the above-named album in a convenient electronic format, could you please send it my way? Email works well for this: steve@laniels.org.

And yes, if you’re curious: I did try buying it via Amazon MP3s, but it’s not available there. I buy a lot of music that way. It’s gotten to the point where my need for instant music gratification makes buying an actual CD extraordinarily unlikely.

I could also buy through iTunes, which I’ve got to work through Wine. But iTunes files are DRM-encrusted. If anyone out there knows how to strip off the DRM, let me know. Yes, I know that I could burn to a CD and re-rip to MP3. Unfortunately, iTunes doesn’t work well enough under Wine to allow interaction with hardware. So I can’t do the buy-burn-rip sequence. This is, in fact, one of the reasons that has delayed my buying an iPhone: if I wanted to put any interesting apps on it, I would need a Windows box from which I could run iTunes.

Hence: if anyone has it, I would love to download it from you.

Update (27 July 2008): Done and done, thanks to a generous reader. Hats off to my anonymous friend.

Update (27 July 2008): My library’s computer system asked me tonight, “Did you mean overbite sensation?” No, but I really wish I did.

I dropped my phone on the floor last night (at Toscanini’s, if you’re curious), and now it’s all messed up: without a headset plugged in, I can neither hear anything nor transmit my voice over the wire. With a headset, I can hear but not speak.

So if you need to get in touch with me over the next few days, try text message (6173085571@vtext.com), home email (steve@laniels.org), work email (slaniel@itasoftware.com) or work phone (617-714-2722).

After reading Orhan Pamuk’s Istanbul, I’m really inspired to read some books in the original Turkish — particularly those by Ahmet Rasim. Pamuk had a lot of good things to say about Rasim’s book City Dispatches, which appears to be unavailable in English. My friend David tells me that it’s known as Şehir Mektupları in Turkish; it’s available for $5.99 plus shipping from tulumba.com. I ordered a copy a while back; it took some time to get to me, but I now have it.

So, with Geoffrey Lewis’s Turkish Grammar at my side, and the Redhouse Turkish-English/English-Turkish Dictionary, I am going to give translating it a go. Turkish is a beautiful language; I’m really looking forward to this.

It will have to wait a short while, though. Once I finish Diarmaid MacCulloch’s The Reformation, the illustrious mrz and I are going to hit up Protestant Thought Before Kant. Somewhere in there, I will also be hopefully reading and reviewing my first book for Bookslut.com, who’ve graciously (foolishly?) decided that I’d be a good match.

But after those books — say, around the beginning of October — I intend to take a month or so to translate City Dispatches. It should be a lot of fun. Anyone who wants to join in should grab a copy off Tulumba and read along with me.

I’ve been looking for my copy of Landes and Posner’s The Economic Structure of Intellectual Property Law for a few weeks now, ever since some friends and I got in a discussion of trademark law and public health. TESoIPL is a terrific book, which I read a few years back. (My list of previously-read books tells me that I finished it almost exactly four years ago today.)

I can’t find it, though, and I wonder if I lent it to anyone. I highly doubt I would have sold it; it was too good to sell, and in any case I’m pretty sure it’s loaded with margin notes. It’s also not on the list of books I sold off when I was unemployed.

So did I lend it to anyone who reads this blog? If I don’t find it soon, I’ll probably just buy another copy.

I just got a mailing from the ACLU, announcing that Michael Mukasey had proposed one or another new way to gut the Constitution. As is my wont, I googled for Mukasey and intended to click on the News link. But among the links returned by Google was this excerpt:

The fundamental problem here is that the media give Mukasey’s words automatic credence because he is Mukasey. But it actually goes a bit deeper than that: not only should the media not give him that credence; they should obviously give him less because he is a public figure. Mukasey’s utterances on the subject of terrorism are as suspect as Steve Jobs’s on the awesomeness of the iPod, say. “Jobs Asserts That New iPod Is Best Ever” would not be a headline, for obvious reasons. Why does Mukasey deserve any more credibility here than Jobs does there?

WordPress 2.5 or 2.6 — I don’t exactly remember which — incorporated support for Google Gears. This was an extremely excellent idea. If you’re someone like me whose WordPress blog contains many categories — I have a category for books, subcategories for each author, and subsubcategories for each book — WordPress was getting slow: every time you refreshed most any page, WP was reloading the full category list. Now the Gears backend stores all those categories — along with, I’m sure, lots of caches of other data structures — on the local disk. If I say that WordPress is now 20 times faster than it was pre-Gears, I don’t think I’m exaggerating. Every aspect of it is now faster.

If I understand the way these things work, bits of HTML 5 are now rolling into people’s browsers. One part of HTML 5 will be more-sophisticated client-side storage; this may in fact be the first innovation in web-standard client side storage since cookies. I believe there will be both a lightweight backend database (à la sqlite?) and an associative array.

Each browser will no doubt implement its own client-side storage. Perhaps they’ll use Gears? They could, given that its license is the New BSD License. I don’t know enough about such things to explain why, say, Firefox would pick Gears over some alternative. And in fact I don’t know what the alternatives are, beyond what Firefox itself might be developing internally.

If Google isn’t locking anyone into its code, then what’s in it for them? Maybe people will get used to programming against Google APIs and won’t want to switch to other APIs? That seems like a rather … polite form of lock-in.

This is something I’ve dreamt of for a long while: getting Google Maps directions if you’re on foot, rather than in a car. Awesome.

One thing I’ve always done to approximate foot distance is to compute the driving distance from A to B, then the driving distance from B to A, and take the smallest. That accommodates somewhat for one-way streets. This new Google innovation is far cooler.

I’ve wondered for a while whether rewriting everything to give foot directions is difficult. The way I’ve envisioned Google Maps internally is as a giant adjacency matrix, with distances as the matrix entries. Most of those distances need to change if one-way streets go away. So internally, does Google Maps switch from one adjacency matrix to another in order to handle pedestrians? Not that that’s a huge deal for them — what’s another few hundred gigs of memory between friends? – but I do wonder if I’m on the right track.

Thanks to Adam Rosi-Kessel for discovering this.

I relistened to Woody Allen’s “I shot a moose…” standup routine yesterday. It is quite brilliant. I felt a bit sad listening to it, though, because I’ll never be able to reproduce the hilarious shock that I felt upon hearing it for the first time. I wish I could return to that state of childlike glee.

If you’ve not listened to it, please download it from my cache in Ogg Vorbis format, or MP3. It’s about 3 minutes long. Those are 3 well-spent minutes.

If you happen to hate Woody Allen, by the way, I should note here that a friend listened to the sketch today after asking me, “Will I still find this funny if I’ve found every single Allen movie I’ve tried to watch completely unbearable?” He ended up loving it, so I have hope for the rest of humanity.

Could people stop using the phrase “déjà vu all over again”? It was a Yogi Berraism. It was supposed to be silly and redundant, like all Yogi Berraisms: “déjà vu” obviously already means “once again.” Yet I could count the number of times that journalistic institutions have used “déjà vu” without “all over again” on two hands.

A review of Jane Mayer’s terrific-sounding new book, for instance, contains this bit:

In 1919, government-stoked paranoia about radicalism produced the Red Scare. After Pearl Harbor, hysteria mixed with racism led to the confinement of some 110,000 Japanese Americans in internment camps. The onset of the Cold War triggered another panic, anxieties about a new communist threat giving rise to McCarthyism. In this sense, the response evoked by 9/11 looks a bit like déjà vu all over again: Frightened Americans, more worried about their own safety than someone else’s civil liberties, allowed senior government officials to exploit a climate of fear.

Drop the “all over again,” people. It will make you feel better.

I’ve been trying to figure out for a while exactly where the tax law says that employers can deduct more for parking fringe benefits than they can for mass-transit fringe benefits. A bit of digging just answered my question, thanks to the IRS’s guide to fringe benefits for employers. That guide points us to Cornell’s law archive, oddly enough; why can’t the IRS archive the laws that govern it?

Specifically, employer fringe benefits are defined within Title 26, Subtitle A, Chapter 1, Subchapter , Part III, Section 132, Subsection (f), Subsubsection (2), to wit:

(2) Limitation on exclusion

The amount of the fringe benefits which are provided by an employer to any employee and which may be excluded from gross income under subsection (a)(5) shall not exceed—

(A) $100 per month in the case of the aggregate of the benefits described in subparagraphs (A) and (B) of paragraph (1), and

(B) $175 per month in the case of qualified parking.

I would still like to figure out why the parking benefit is higher than the mass-transit benefit. It’s not as though mass transit always costs less than $100 per month: I could very easily spend $250 per month shuttling back and forth to Newburyport or Providence. In any case, the tax-law documentation itself doesn’t explain the reason behind the policy.

At work, they asked us what fringe benefits would be useful to us. I suggested that perhaps they spend some money to equalize the parking and mass-transit benefits: pay us $75, or the excess of our mass-transit expense over $100, whichever is smaller.

Which is a nice teachable math moment, for those who are interested. Suppose I incur $200 in mass-transit expenses in a month, so my company reimburses me $175. I owe taxes on $75 of that, because the government only lets my company deduct $100. Suppose I’m in the 28% tax bracket; that means I owe $21 in taxes on the $75. But the people who receive the parking benefit don’t need to pay $21 in taxes. So a company committed to fairness would also reimburse me for that $21. That’s $21 in additional income, on which I would then be taxed. I’d owe $5.88 in taxes, specifically (again, 28%). So my fairness-minded company would reimburse me $5.88.

And so forth, ad infinitum. In total, the company would reimburse me

$75 + $21 + $5.88 + $1.6464 + $0.460992 + $0.12907776 + …

This is known as a geometric series, with ratio .28. It has a finite sum, namely $75/(1-.28) = $75/.72 = $104.17. My company needs to reimburse me $104.17 to give me the same benefit that car drivers already get.

An easier way to arrive at the same conclusion is like so: my company needs to pay me $x to equal the parking benefit. I will be taxed 28% on those $x. So after taxes, I will have $(1-.28)x in the bank. I want my after-tax benefit to equal the $75 that parking users get. So I want (1-.28)x = 75, whence x = 75/(1-.28). Different route, same answer.

My company didn’t think quite as much of my idea as I did. Nice geometric series, though.

I’ve gotten in dozens of discussions with people about health insurance in recent years. For some reason the phrase “adverse selection” rarely pops up. I don’t know why. As far as I can tell, it is the important issue in health insurance — it is the reason why universal health insurance is the only conceivable solution to the problem. But few people have heard of it. So here goes. Very simple.

Suppose health insurance isn’t mandatory — that is, you can choose not to be insured. If it’s too expensive, you won’t participate. In particular, if you’re a healthy person, you might rationally decide that you won’t need to be covered.

To make it concrete: suppose premiums are $100 a month, and that you — as a healthy person — decide that you’ll incur less than $100 per month in health-care expenses. So you don’t get insured. All your healthy countrymen do likewise.

So now the only people left in the insurance pool are those who think they’ll need more than $100 per month in health care. Since $100 is the minimum, the average person in the insurance pool needs more than $100 in care. So let’s say that now the average patient who’s left in the insurance pool needs $150 in care per month. The premium has to go up to at least $150 so that the insurance company can break even. Now some more people are priced out of insurance: they think that insurance costs too much, so they don’t get covered. Premiums rise again. And so forth.

Eventually, the only people left in the insured pool are those who need the most care. Premiums are too high for everyone else.

Mandatory health insurance is the only conceivable solution to this problem. If people can’t leave insurance, then the healthy people stay in and help subsidize the less-healthy. Then when the healthy folks turn old and are themselves less healthy, their countrymen can subsidize them.

The U.S. recognized adverse selection as the problem years and years ago. This is why Medicare exists: old folks are not insurable at any price. Older folks will necessarily have higher premiums to start with, and adverse selection drives them still higher.

Which is to say that we’ve known about the failures of the health-insurance market for decades. There is no mystery to the problem, or to its solution. The problem is adverse selection; the only solution is universal coverage.

Now “universal coverage” can mean lots of things. It can mean

• Government-provided insurance.
• The government mandating that everyone have insurance through a private insurer. Massachusetts has done this.
• Public/private competition: everyone has insurance, either through a private insurer or the government. Americans are free to choose whichever insurance they like, and are free to switch between insurance providers. Competition selects the best insurer. This is the system that President Clinton proposed.
• Everyone is entitled to a minimum standard of care, and can pay for anything they want above that. This is how I’m told the French system works.
• etc.

When people imagine universal health care, I think they have the first bullet in mind.

Naturally there’s the concern that if you insure people against something, they’re more likely to do it. If you guarantee people treatment for drug abuse, they’re … more likely to abuse drugs? It’s not exactly clear what people might mean here. The general term is “moral hazard” (quaintly Victorian, that), and Malcolm Gladwell smacked it down nicely back in 2005:

A country that displays an almost ruthless commitment to efficiency and performance in every aspect of its economy—a country that switched to Japanese cars the moment they were more reliable, and to Chinese T-shirts the moment they were five cents cheaper—has loyally stuck with a health-care system that leaves its citizenry pulling out their teeth with pliers.

Granted, there may be some justice to the moral-hazard idea. If my car is insured, I’ll maybe be more reckless when I’m out on the road. But there’s a distinction in there that it’s important to clarify: I should be punished for risks that I bring on myself, and should not be punished for risks I was born with. If you were born with Down’s syndrome, a just society won’t let you suffer because your parents can’t afford to pay. If you routinely get high and crash your car, society shouldn’t pay for your car or your bad behavior. This much is common sense.

At the same time, it may cost more to monitor people’s bad behavior than it would to just cover them no matter what they do. Looking at the actual costs and benefits would go a long way. Surely we have a lot of data, both from U.S. car-insurance statistics and from foreign health care.

One other thing to note: before you mention that “people in Canada/England/France complain about the quality of their health care” or “people in those countries have to wait a long time to get care,” consider the 15% of Americans who can’t get care at all. Or rather, they can get care by going to the emergency room — typically, after waiting for their health to become a crisis and, as Gladwell says, removing their teeth with pliers.

FISA was eviscerated today. I’m not happy about this. I’m not happy that Obama voted to end debate on the FISA bill. But what I want to mention here is that I’m sad we couldn’t get forty Democrats with spines to filibuster it.

How hard is that? 40. 40. We are the majority party, are we not? I called Senator Dodd’s office to ask why he didn’t filibuster it this time around. One of his aides told me that he couldn’t get 40 votes, so his filibuster would have been clotured immediately. I asked whether Dodd could have tried filibustering even symbolically; his aide repeated that, no, in fact that wouldn’t have even got off the ground.

I called the office of Senator Kerry, who to his credit voted for all the right amendments. His aide told me that the senator did all he could to fight it. I asked why he didn’t filibuster. He gave me the same answer as Senator Dodd’s aide. I replied that if I called 40 Democratic senators, I would most likely get 40 copies of the same answer. Kerry’s aide told me that this was probably right. I replied that I felt as though I were shaking my fist at the sea. Kerry’s aide didn’t know what to do with that information.

Why in god’s name can’t my party ever get its act together? And by this point, they can’t claim ignorance. Practically the whole world is telling them that they continue to get played on the national-security card. This has been going on since Joe McCarthy. I would retort with “they know politics more than I do” if they had shown any evidence of knowing anything about politics.

At least Republicans know how to kowtow to their base. Who’s the Democratic base? Ostensibly the poor, labor unions, and civil libertarians (who are somehow supposed to be part of the GOP; if you can square that particular circle, go win a million dollars with your mathematical ability). They’re doing a bang-up job with that.

The Democrats won in 2006 by not being Republicans; I didn’t think then, and I don’t think now, that they actually did anything to deserve it. They may well win in 2008 on that basis as well. Americans may be so fed up with Republicans that Democrats win by default. Shouldn’t we aspire to more than that?

Even if that is how we win, we need to do more than squeak by. We need a filibuster-proof majority in the Senate, because at least the people we’re playing against know how to use the tools at their disposal. And once we get that filibuster-proof majority, we need to figure out what we stand for. That way we can stand together as one bloc when it comes time to vote — just like the Republicans do.

I’ve often heard it said, here, that the Democrats — liberals generally — are the party of questioning, which explains why we can’t get together around a single ideology. That is the purest form of self-flattering bullshit. I would enjoy comparing our ideological cohesiveness to liberals in other countries — say, the British Labour Party. There are a lot of reasons for our lack of cohesion; many of them probably reduce to abandoning our base. If Democrats knew they were the party of rectifying capitalism’s evils, or the party of the poor, or the party of the downtrodden, a lot of people could get behind that. The party doesn’t stand for any of those things, though. Read Joan Didion: what the party stands for, and has stood for since just after the 1968 DNC, is a particular kind of milquetoast packaging — a smaller-than-life median voter theorem that knows how to lose elections.

Attention conservation notice: 1300 or so words on the evolution of international currency arrangements from the 1700’s to now. Contains more than my standard share of confusion, but it felt important to get the ideas down and let other people point out my errors.

This book has two central premises:

1. It’s easier for national governments to keep their currency’s exchange rate in check when they don’t have to worry about voters.

2. International monetary arrangements have a way of coming unraveled if any of the parties has an incentive to back out of the arrangement; this is an instance of what’s called a “coordination problem” (the prisoner’s dilemma is the classical coordination problem). Consequently, the only way to keep such arrangements working is to tie nations together, in such a way that any nation’s backing out of the arrangement would harm it.

The first point gets us from the start of the gold standard until its end in the early part of the 20th century. (Depending upon how it’s phrased, it seems like you could make a case that the gold standard ended in the 30’s when Britain left it, or in the 70’s when Nixon let the U.S. dollar float. I don’t follow the details well enough to explain why you’d pick the one date over the other. More on this ignorance below.) And actually, the start of the gold standard in Britain was a pure historical accident, which takes up one of the more interesting paragraphs I’ve ever read.

It’s an application of Gresham’s Law, and involves Sir Isaac Newton. Newton was the warden of the Royal Mint when Britain was on a bimetallic standard; it was using both silver and gold for its currency. A bimetallic standard is tricky to manage, because you have to set the relative price of the coins properly. For instance, suppose that on the open market, an ounce of gold is worth as much as 16 ounces of silver; gold and silver coins should then stand in approximately the same ratio. Suppose that the market price of silver then rises to 1/10th the price of gold. If the currency still stands at the old 16-to-1 ratio, then silver coins are worth more melted down into bars and traded for gold than they are as coins. Silver coins will systematically disappear and be melted down. If this ill-chosen exchange rate persists for too long, silver coins will disappear altogether from the market.

I should note something up front here: I need to think more about the economic details of this argument. Why, for instance, wouldn’t the melting-down of silver coins eventually self-correct? By melting down coins and taking them out of circulation, we reduce the supply of currency, so the value of each coin goes up; likewise, the rising supply of silver bars makes the value of each bar go down. Eventually, wouldn’t the two balance out again?

The answer is probably that it depends. If the difference between the commodity value and the coin value of silver is too large, all the coins could well disappear before the market has had time to equalize. One might then ask why the British government didn’t continue producing more coins until the market worked it out — or quickly realize their error and return to more sensible relative prices for gold and silver. As it happens, in any case, they didn’t: they ended up accidentally with a monometallic standard. And that’s how we got the gold standard: the lucky (?) confluence of a Newtonian mistake and British dominance in the 18th century.

Another historical accident kept the gold standard working for a while: most people didn’t have the right to vote, and those who did were wealthier than those who didn’t. In a world run by (to modern eyes) undemocratic governments, it’s easy to defend your currency’s gold value: if an ounce of gold buys you $35, say, and the currency devalues so that it now buys you $40, the U.S. government can just spend as many dollars as necessary to bring the currency back into line. In a more democratic world, you need to use those dollars to support your people. In a less-democratic world, the dollars can all go toward gold.

There’s an important supporting fact about 19th-century less-democratic governments that makes this all work out: currency traders know exactly how the government is going to behave. Hence they have every reason to believe that the American government will keep the dollar right where it’s always been. If the currency drops from $35/oz. to $40/oz., traders know that the government will make every effort to bring it back to the old level. They have no reason to bet on future currency drops; the only rational bet they could make is that the dollar would return to its old value. Consequently, the dollar does return to its old value.

What if, instead, traders know that the government has other obligations toward its people? If it would cost a prohibitive amount to defend the gold standard, traders rationally believe that the government will let the depreciation stand, and they will bid the value of the currency down. Now there’s an even wider gap for the government to make up, so traders know it’s even less likely that the government will fix it. And so on down the drain. This is a “speculative attack.” In fact Eichengreen gives an example of a self-fulfilling speculative attack, where countries with a perfectly healthy economy (low inflation, healthy balance sheet, etc.) nonetheless find themselves with a quickly depreciating currency. There’s a paper on the topic, “Self-Fulfilling Expectations, Speculative Attack, and Capital Controls,” that seems like it might be fascinating.

Governments can try other options to keep their currency under control. They can limit the flow of money: charge a hefty fee for every large bundle of dollars or gold that leaves the country, for instance. Other countries have to get involved to make this work: as capital gets more mobile, any country that locked down currency transfers would find itself with a massively depreciating currency as investors sold it and bought other, freer currencies. You can see why multinational agreements to lock down currency transfers would have a hard time sticking around: if I defect — you lock down and I don’t — money flows into my country and out of yours. We need some way to tie our fates together if we’re going to make this work. My understanding is that European monetary union — the euro — is precisely such a fate-tying mechanism: we give up flexibility in some areas of monetary policy in order to solve a larger coordination problem.

Again a question of detail comes up: suppose the currency flows from a less-open to a more-open economy. For the sake of concreteness, let’s say those economies are Germany and France, respectively. Money flows from Germany to France, so now one franc buys more deutsch marks. France doesn’t want this exchange rate to rise too far, because now Germans can’t buy as many French products; export-intensive French industries are harmed by Germany’s capital constraints. So it would seem that France and Germany are already quite strongly linked by self-interest, even in the absence of any agreements on capital controls.

I’m sure the answer to this, as well as to all my other questions, is within Globalizing Capital. My sense is that it is a book which can never be read, only reread. I’m really looking forward to rereading it.

(Thanks to Cosma Shalizi for recommending this book in an email. He wrote a review of Globalizing Capital, which I forbade myself from reading before I wrote this one.)

I was honestly worried that this would be exactly the sort of book that I can’t stand. “Guy nears death, which buys him some gravity that he wouldn’t otherwise have earned.” I.e., Tuesdays with Morrie Volume 2: Morrie's Back ... And Getting Even.

Fortunately, Pausch doesn’t try to justify The Last Lecture on the basis of his being a Wise Dying Man. If you’ve not already watched Pausch’s last-lecture video on the web (I have not): he’s a computer-science professor at CMU, dying of pancreatic cancer. The Wikipedia suggests that his cancer is now terminal. Pausch, being a rigorous sort, knows he’ doesn’t have long to live: only 4% of pancreatic-cancer patients make it to five years. He believes he’s had an extraordinary life, he wants to reflect on how blessed he is, and he feels like sharing with us how he got there. Result being: if you make it through this book without crying once, I will pay you. I certainly couldn’t make it through with dry eyes.

The beginning and the end of The Last Lecture are the real tear-jerking parts: we meet Pausch, we meet his family, and we learn about his upcoming death. At the end we hear, for just a moment, about the tears that he and his wife have shed before (and after) bed — after the bedroom door has closed and the kids are asleep. That’s one of the most heartbreaking parts of it all: Pausch’s children don’t yet know about his illness; the parents are waiting until he becomes symptomatic to tell them. In the meantime he’s preparing: delivering a last lecture to impart some life lessons, getting his life insurance in order, buying a sports car, going on fun trips with his wife … having a good time, and trying not to think too much about his own death.

Between the watery-eye parts is a set of straightforward and eminently practical life lessons for the reader: write thank-you notes; try harder than the other guy; be honest with everyone. Each moral is backed by a story from Pausch’s own life, and — honestly — perhaps a bit too much of “look at how excellent a guy I am”: every lesson he’s teaching is of the form “someone out there was good enough to do me this favor, so now I’m passing it on to you.” This structure may be what Pausch calls a “head fake.” In sports, a head fake is where you trick the other guy into thinking you’re going one way when in fact you’re going the other. In his life, Pausch uses his own brand of head fake to make his students think he’s teaching them one thing when in fact he’s teaching them another. The book self-admittedly contains a few head fakes, and I think a few others are hidden. One of the hidden head fakes is the final lesson: “Help out other people however you can, just like I have with this book.”

It’s charming; you almost have to end up admiring Pausch. And you have to wish his family well. I’m sure they’re going to miss him.

I’m probably going to buy an iPhone on or about July 11, partly because the Treo 650 really sucks (welcome to Windows 3.1, as my friend Josh Mahoney puts it) and more because of a larger issue: phones should just be small computers. Apple seems the closest to realizing this.

Text messages have irritated me more and more as the years have gone by. The thing that first struck me about them was that they aspire to be emails. First they’re limited to 160 characters. Then the providers discover that users want to send longer texts — so if you’re on Verizon, for instance, you can send something like seven texts concatenated into one (unless you’re using the aforementioned Treo 650, whose texts are limited to 160 characters). Then providers discover that people like sending multimedia attachments, so they invent MMS messages. We still want threading, and quoting …

What we want here is email. We want MIME attachments rather than MMS. It just happens that the phone industry is locked into a model that started developing with the landline industry many years earlier. If the phone industry had begun with the computer industry, a lot of things would be different: the iPhone’s novel way of treating voicemails like emails wouldn’t be so novel. Call waiting wouldn’t be something you do with a single phone call: you could receive many calls and put them all on hold. Likewise, “three-way calling” wouldn’t be a special feature; N-way conference calling for N greater than 3 would be trivial. (At an implementation level, I believe this would just be a multicast UDP application.)

I don’t think even Apple really gets it, actually, though they’re trying. On a real computer, I could install any application that I desire. My relatively uninformed guess is that Apple is constrained by its providers: AT&T doesn’t want you to install Skype on your iPhone or iPod Touch, so Apple is required to clamp down on installable apps. This one design constraint leads to a whole set of other limitations. On a real computer, you could install Skype or anything else.

And you’d be able to back up a real computer. I could do a bit-by-bit backup of the iPhone’s firmware using any number of command-line utilities like dd or rsync. If the iPhone had a fully functional USB port (I’m not sure: does it?), I could connect a USB thumb drive to it, boot to thumb-drive Ubuntu, back up my phone to that drive, and restart the phone. I wouldn’t need to go through contortions to back up “certain … information” from that phone; I could back up all of it, no questions asked.

My hope is that the Googlephone will cure all my woes here. Apple or Google will realize that a phone is just a computer with a user interface that’s specially tailored to voice calls and small boxes.

The network is also just a pipe for carrying bits. I should be able to walk into any convenience store, buy a phone off the shelf, put a simcard in it that maps this phone to this number, and be on my way. Maybe the routers are smart enough to figure out billing: the nearest Verizon WiFi (or whatever) router sees a simcard for 617-308-5571 and charges me some money to be on its network for however long I’m on it. I move down to the block to an AT&T router, and its billing software does the same thing.

Or maybe I don’t get charged at all, because my phone is smart enough to hand me off seamlessly from WiFi to cell. When I’m on WiFi — as I would be when I’m at home — my call is free. I configure my home WiFi router to allow my phone as much bandwidth as it desires (within my cable modem’s limitations), so voice calls from home are really high quality. When I switch back onto the cell network, the quality goes down.

So in short, we should be thinking about phones that are just small computers, running on top of Just Another IP Network. The fact that we’re not there yet owes a lot, I think, to the Ma Bell origins of the phone network. I want a phone network designed by computer companies and Internet service providers, not by old-line phone companies.

And for that matter, I want government-mandated network openness: if my AT&T phone wanders into a Verizon-only area, Verizon charges me for my time on their network. Now providers wouldn’t be able to compete on their networks; they’d compete on other things, like devices or customer service.

Incidentally, I had fun the other day calling Verizon to tell them that I was considering switching to AT&T and getting an iPhone. I’ve been off a Verizon contract for years. They told me that I’m eligible for a discount on a new phone, so long as I renew my contract for two years. I replied that this is a “non-starter”: if I’m going to get a new Verizon phone, I’ll go buy one on eBay and skip the contract renewal. I don’t think the sales guy on the other end was especially happy to hear this.

If you’re into economics, find it a little disappointing, and would like a more-philosophical (while still firmly mathematical and rigorous) take on the discipline, this book is for you.

In two earlier, exceedingly hefty and fascinating books — Sunk Costs and Market Structure and Technology and Market Structure — Sutton has put forth a particular, humble vision of economic modeling. Most economic models involve specifying a set of parameters quite precisely, very carefully laying out how actors (that is, people or companies or whatnot) will behave, then solving for their behavior in “equilibrium.” That equilibrium can evolve over time, so another class of economic model — those based on evolutionary game theory maybe being the most famous — carefully lays out the rules by which people change over time. The models might include some process of learning, for instance.

Sometimes this precision works — matches up with the data — and sometimes it doesn’t. When it doesn’t match up, quite often it’s because our models are missing important variables. Models need to be simple in order to be usable, though, so we can’t very well add in every conceivable variable that might affect an economic outcome. (Though here is the place to note that a realistic psychology would go a long way to building microfoundations that might eventually bubble up into accurate macroscopic models of, e.g., stock-market pricing.)

Sutton’s response is refreshing, and is unique at least among the bits of economics that I’ve read: abandon altogether the search for One True Model. Instead, pick a few axioms that any credible model must satisfy, then use those axioms to derive a class of models in which the truth is likely to lie. Specifically, his models of industrial organization rest on two principles:

• Viability: In equilibrium, every company in a particular industry will be making nonnegative profits.
• Stability: No new company could enter and make a certain profit.

The latter condition is essentially an arbitrage principle: don’t assume that all economic actors are rational; only assume that if there were an obvious opportunity, someone would eventually take it. An equilibrium industry configuration is then one in which both viability and stability are satisfied. (I found a paper of Sutton’s entitled “One Smart Agent” that bears on this subject and may be interesting to some of my readers.)

Sutton’s approach here is really elegant, really simple, and promises to be really productive. Being an eminently fair man, his next step is to ask under what conditions the classic economic approach — one model to rule them all — is likely to bear fruit, and under what conditions his class-of-models approach will work better. In the process of answering this, he sketches some really beautiful game theory on the design of auctions, specifically auctions of petroleum-bearing lands. I can’t do any better than Sutton in laying out the theory here, so I’ll just point you to page 47. The upshot is that in the case of an auction, we know very precisely how participants will behave, because we know exactly what the rules of the auction are. Sutton’s own field of industrial organization is much less well-formed, hence much more usefully treated with a class-of-models approach. (Full disclosure: I never finished Technology and Market Structure or Sunk Costs and Market Structure; that mostly had nothing to do with their mathematical content — which is substantial — and had more to do with my available time.)

His writing is dense but not difficult; one just needs to read a bit more slowly than usual. Without ever having met the man, I can only imagine that he’s a fun, amiable, brilliant sort. On the way to telling us what sort of workable models he thinks we have any right to expect in economics, he sketches the history of modeling tides in physics — fascinatingly enough to make me want to rush out and read the appropriate citations. This is where Marshall's Tendencies gets started, in fact: it seeks to understand why modeling aggregated human behavior might be a much different task than modeling aggregated water waves.

Sutton traipses from waves to game theory to industrial organization, all with enough rigor to satisfy the most demanding reader but with enough of a light touch to never bore you. All this in just over 100 pages. Bravo to Professor Sutton.

(Thanks to Cosma Shalizi for the recommendation. Though I should note — purely to prove that I still do possess an independent will — that my earlier exposure to Sutton inclined me toward this book. That said, I wouldn’t have even looked at TAMS or SCAMS had I not seen them recommended on his blog. This quest for free will is more than likely illusory.)

You know how some people say, “I don’t believe in religion, but I believe in God”? Thomas Geoghegan doesn’t necessarily believe in labor unions, but he believes in labor. Or maybe: he doesn’t believe ultimate salvation is to be found in unions, but that there’s no alternative to them for now, and that without them we’re … well, we’re in the state we’re in today, where workers are powerless and can be left unemployed and uninsured at any moment. A world without unions is a world where we’re scared.

This is just not the world we ought to be living in. There is a better way and a better world, of course. We know that we can’t get to this world on our own. On our own, we are isolated from the rest of those who are suffering. We are powerless so long as we are isolated.

It’s virtually an axiom, then, that some form of collective resistance to limitlessly powerful corporations is necessary. We simply cannot do it on our own. It does not follow, however, that labor unions are the ideal form of that resistance. It also doesn’t follow that government is the ideal form. But in their highly imperfect way, says Thomas Geoghegan, labor unions are far better than a world without them. He backs this up with story upon story about corporations absolutely crushing workers in the absence of any labor-union resistance.

Geoghegan himself is a labor lawyer who’s been fighting the fight alongside labor unions for a quarter century or more. He’s also often worked against them: he’s sued the Teamsters repeatedly, in essence fighting for more union democracy. He’s trying to get the unions that the employees deserve.

He’s not had much luck fighting against them. For a short time, Geoghegan’s heart leapt for joy when Ron Carey was at the Teamsters’ helm, but the Carey era ended quickly enough and James P. Hoffa (son of Jimmy Hoffa) took over.

As for fighting alongside them, that hasn’t worked very well either. Unions are down to 10% or so of the working population. Not coincidentally (as any reader of Paul Krugman knows well), the Democratic party is in a shambles and has been for at least thirty years. The Democrats need the unions.

What makes this book so agonizing is Geoghegan’s insistence that a few little changes would bring democracy to the unions, unions to the workers, and the Democratic party to power. One such change is a card-check system like the one Canada uses. Consequently, Canadian union membership has been consistently in the 30% range for at least a decade. When we dream of the better world that Canadians seem to inhabit, it’s well to consider how they got there.

The fact that just over the border is a country not much different than ours, but whose policies could hardly be more different, gives the lie to the notion that unions have disappeared in the U.S. because of changing workplaces. Yes, we’re now a service economy rather than an industrial economy. But so is Canada. Geoghegan dispenses with any number of commonplaces like this one.

In general, he spends the most time dismantling the idea that unions’ disappearance is in some sense “natural.” It’s not. It has a lot to do with Republicans and with conservative courts. It has to do with Taft-Hartley. It has to do with one law after another that smashed unions into the ground. There was nothing natural about it.

This book doesn’t give much in the way of solutions, but I’m not even sure that’s its point. Merely getting people — especially Democrats — to recognize a problem is plenty. Getting them to recognize a human-created problem is better still. Along the way, Geoghegan is impossibly funny, chatty, and self-deprecating. While I can’t quite call this book a “joy” — it’s too maddening for that — I do submit that it’s indispensible and should be on every American’s bookshelf.

(Thanks to Cosma Shalizi for the recommendation.)