The horizon is not so far as we can see, but as far as we can imagine

Month: April 2014 Page 1 of 3

Moving this week, so posting will be light

I’ve been at this place for years, and the new place is smaller, so I expect it to be an extra fun move.

If I were a Russian Strategist I’d say “invade the Ukraine”

Really.  Too much talk about joining NATO, and that’s too close to Moscow, plus the West’s unremitting hostility to Russia pulling the sort of stunts that the US pulls frequently, indicates that the West is a real danger and that if they waste this opportunity, they won’t get another one.

I’d advise Putin to go.

(For the thick, I hope they don’t, and I’m not a Russian strategist.  Just saying that just as losing Sevastopol and Crimea was something Russia could NOT tolerate, that Ukraine joining NATO is an actual red line.)

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The Prelude to the End of the American Era

And so it begins.  Russia is not restraining the separatists, the Kiev government is finally really sending in the troops, Barack Obama and EU leaders claim they will impose real sanctions and Russia and China are set to ink a deal to export Russian Gas to China, the world’s industrial heartland.

If the sanctions are imposed, for whatever reason (Russian invasion or not), they will force the creation of a second economic, non-dollar bloc.  Russia is not Iran, and China is not going to cut off Russia to please the West, rather the contrary.  The creation of a real non dollar bloc which can make almost anything people want, and which has access to essentially all key resources from oil to rare minerals, metals and food is an existential threat to the hegemony of the West and its allies like Japan and Korea.

Be clear, real sanctions will impose real costs on Russia, but they can bear them.  They do not need to borrow money from the West, they cannot be Troika-ized. They have key resources that someone will buy, even if they can’t buy in dollars, because Yuan or rubles can, actually, buy most of what most countries need to buy.

Absent China, Russia cannot be isolated.  Cannot.  China is unlikely to cooperate.  Sure, they could view eastern Russia near their borders as ripe, but Russia as a subordinate state in the Chinese sphere means they get everything they really need from the Russians anyway, plus backing in a military confrontation with the current developed world.

The Chinese are not stupid, they know that if a real war breaks out, it will be between them and America.  They are the rising power, the naturally most powerful and militarily powerful state in the world, recovering from a hiatus of a few centuries where they lost their status.  Russia has a lot to offer them, and the Chinese cannot be coerced by sanctions.  Sanctioning China would backfire so hard that the US was go into a real economic collapse: China makes the goods.  Sanction them, and they WILL break the patents and just make them anyway.  Reestablishing the manufacturing and distributing base back to the US and its allies under such circumstances would be unbelievably difficult, especially as Russia, China and its allies control certain key resources like rare earths (other people could mine them in quantity, but don’t, because Chinese rare earths are cheaper and we are stupid and greedy.)

Russia is already planning how to survive economic sanctions: how to sell its goods in rubles.  People will buy, Russia is too big a producer to ignore.  If Europe doesn’t want the growth which comes from using Russian gas and oil, well, China and others will be  happy to take it.

And once a second bloc is created, it will no longer be possible to pull stunts like breaking Iran with sanctions: the Chinese/Russian bloc will have a veto.

Over Ukraine?  I guarantee that if this is done in 50 years historians will look back on this like we do on WWI—what were they thinking?  The Balkans wasn’t worth WWI.  Ukraine isn’t worth destroying American: Western, hegemony.  Well, not for America.  Others might think this is more of a good thing than bad.

But it is also the potential glide path to war, real war.  WWIII.

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Why Nations Can’t Resist Austerity

Free trade, as practiced, is designed to destroy local autonomy by making nations dependent on foreign goods, and by removing decision making from democratically elected bodies and pushing them to transnational tribunals, secret courts and laws which cannot be changed without opting out from treaties, something most countries are reluctant to do, because they need the trade once they are enmeshed.

Keynes believed that most production of basics should be local: you should manufacture most of what your country needs, in your country.  You should also, ideally, be able to feed your own population.

If you can’t make what you need or what your people (and more importantly, elites) really want, then you’re screwed.  In the modern world you need hydrocarbons, you need food, and you need the machinery which turns hydrocarbons into the industrialized lifestyle.

Your prosperous citizens probably want food your country doesn’t produce: summer vegetables in winter, possibly meat you can’t provide in large enough quantities, and so on.  They want electronic goods like smartphones that due to patents are quite expensive, and which you probably can’t make domestically.

Your elites want a vacation in Paris, a home in London, a German car, a French mistress, a New York Apartment, and a variety of luxuries that their own country doesn’t make.

If you want or need these things; if you do not have a taste for what your country can produce, in terms of basics and luxuries; if you do not ensure your country can feed itself, generate electricity and make cars or other forms of transit, you MUST do what those who control the trade regime want you to, or you will find yourself cut off from all these things.

Distributed production of necessities (which includes basic lifestyle goods and luxuries and machine goods) is anti-democratic and anti-national control in a world where the primary decision making units which are amenable to pressure from the commons, whether democratic or not, is exerted almost entirely on national and local units.

If you want to not do austerity when the Troika demands it, you must be in a position to tell the Troika to go stuff itself. If you have made yourself vulnerable, by losing your ability to feed yourself; by not developing local industry or exporting it; by your citizens acquiring a a perceived or real need for foreign goods; or by your local elites wanting to be “transnational elites” who want foreign luxuries and who feel as at home in Paris, New York and London as in their own country, then you cannot refuse to do what those who control the trade and international monetary regime tell you to do.

This is always the devil’s bargain offered in international regimes: “you can get all the stuff we have if only you open up”.  It’s true, and for many countries it works for a while.  The less you had, the shorter period it works for (countries who only have to be convinced to give up their ability to feed themselves by switching to cash crops and forcing subsistence farmers get a few years), but once you’ve given away your autonomy, the deal will, at some point, always turn bad.  Those with the whip hand, will always eventually drive you down unless you have as much power over them as they have over you.

And knowing that your elites are no longer yours, but theirs, they will always find someone to do it for them, because your elites will be eager to sell you out for the flat in New York, the vacations in the south of France, the German automobile, the French mistress, the Swiss boarding school for their children, and for the fine luxury goods their own country cannot make.

If you get yourself into this position, you must overthrow your elites, and you must figure out how to become independent again.  You must make deals with other blocs: the Russians and the Chinese, for the transition period, and figure out how to move your production of what matters back to local, and if you no longer can, how to feed yourself. You must inculcate in your elites and peoples a desire for what you make locally – local lovers, the food of your nation, the luxuries you can produce.

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Do NOT take Western Help for your “revolution”

The BBC has admitted that Assad will remain in charge of Syria.

Now I have no mandate for Assad, by all evidence he’s a profoundly evil man who delights in torture as a way to send a message.  His excesses in this area are such that I wouldn’t be surprised if he personally gets off on it, but the fact of the matter is that the rebellion has made Syrians worse off.  Period.

I will note that when Hezbollah committed its forces I said then that Assad would probably win.  What’s worse is that any moron ought to have known that Hezbollah could not allow Assad to fall because if Assad fell, its lifeline to Iran would be severed.  The forces which were arrayed against Assad either had to win quickly enough that Hezbollah couldn’t turn the tide, or they had to cut a credible deal with Hezbollah, which due to both ideological reasons and because of the preferences of their backers, they never could.  Well, or they had to intervene directly: Western air support as in Libya.

There is no point, if you are are unhappy with your domestic regime, in accepting Western aid to overthrow it at the moment, not unless you’ve got a plan to bite the hand that feeds you.  The reason is that the West is no longer exporting prosperity, and hasn’t been for some time.  Excepting (sort of, very sort of) China, the last countries to get prosperity from the West were a few Eastern European ones; before that, the Asian Tigers.*  Instead the sphere of prosperity based on the West is in contraction, just ask the South of Europe, or Ireland.  (The Chinese sphere is another matter, though they have problems too.)

Even if you win your revolution with foreign aid, a la Libya or the Western Ukraine,  you aren’t going to be offered a good deal: the Ukraine is still going to get shafted by the IMF to the tune of a 50% cut in pensions, a 50% increase in gas prices even before Russian price increases, government austerity and selling off the crown jewels of energy companies and arable land to foreigners.  Libya is a bloody mess: again, however bad Qaddafi was, he was better than the current situation.

There is no real money; no real resources, for prosperity to be spread to new nations by the West and its allies (like Japan).  The new money being created is heavily leveraged debt piled on the back of countries who already can’t pay, money they’d be better off without.

So, don’t play with the West.  Don’t take their money and aid in overthrowing your corrupt government, unless you know exactly what you’re doing and plan to to turn on them and align with someone else.  If you do, your country will be worse off.

Though, perhaps you should take their money.  Personally, I mean.  You can get rich yourself and then escape your country, if you’re a traitor.

Non-traitors, however, shouldn’t touch Western or Saudi money for revolution.

*One might argue that the West has rarely offered prosperity to those it backs in revolution, Latin Americans would certainly agree, but it’s not quite true: the Koreans did, the Poles did, some other East Europeans.  However, now they not only don’t offer prosperity, they offer the prompt austerity and debt driven destruction of your economy.

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The problems of social sciences

Are far harder problems than most of the problems of the hard sciences.  Why people do what they do, under what circumstances is a problem of vast complexity, and we don’t have the necessary models.  The models we do have (such as evolotunary psychology, and our abysmal knowledge of neuroscience), while powerful, are incomplete, and overly simplistic at capturing emergent behaviour, especially in groups, let alone the effect of culture.

That’s not to say we don’t know a lot, I’m hardly a great expert and I could teach many years worth of courses just with what I know, but we do not have the level of predictability the hard sciences have.  It also hard to falsify social science due to problems setting up the experiments, and when you use real world data, it’s hard to isolate variables.

This problem is exacerbated by the fact that social sciences — and many humanities, are ideological enterprises which have an effect on the real world distribution of goods: who gets what.  They are used to justify distribution of goods: of the things people want.  When “hard” sciences, like biology, are used in this way, they too cross over into the ideological social science bucket and generally cease to be hard sciences.

This is because the “ought” is, so far, impossible to separate out of the humanities and social sciences. Ethics and morality are always lurking, and efforts like Skinnerian behaviouralism have all, so far, failed.  Humans are cussed, and complex, and reductionism only works in the most broad based and caveated sense, again, largely because of the effect of culture.  Say that all people are greedy, or selfish, or kind, or altruistic, or driven to pass on their genes, and the cultural anthropologist, or the pyschologist, will find you exceptions.  Humans biology imposes drives on humans, but the ways in which we satisfy those drives, or subliminate them, or even fight and deny them, is, if not infinite in theoretical terms, then infinite in practical ones.

All of this makes the problems of the social sciences vastly difficult, and far less progress has been made than most think.  Even neuroscience, which is not a social science, has teased out only a few mechanisms and has little understanding of how they mesh together.  In practical macro-terms, when dealing with problems of social organization that are province of sociology, economics, political science and mass psychology, we are not much more wise than the Ancient Greeks, and on certain issues, perhaps less so.

One should be wary of the experts.  It was not so long ago that pyschiatrists were mass lobotomizing people and treating them for homosexuality.  It is today that they are vastly overprescribing psychoactive prescription drugs to young children (and everyone else, especially upper middle class women.)  Following neo-liberal economists prescriptions has led to 40 years of stagnation, a financial crisis and a long depression for the developed world (yes, that’s what we’re in.)

The social sciences are still in the dark ages.  As with medicine in the dark ages, occasionally a gifted, wise or brilliant practitioner (usually applying souped up folk medicine) could do more good than harm.  You must look, carefully, at each individual social scientist, and decide if you trust him or her, because the degree and the discipline means little.  It is how the practitioner combines  the knowledge that matters, the knowledge is not currently in reliable, formulaic form, nor is there even a reliable method for creating formulas in the most cases (case studies and regression statistics have utility, but it is limited.)

So, ye who would enter the social sciences: know that you will be responsible for making it work, it doesn’t work as it’s given to  you.

And you who would consume it, be even more wary, for this is the dark age of social science, in which we pretend it is science, when it is still art.

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You want a good internet economy with lots of jobs? Here’s How.

I’ve been blogging for a long time, and I was managing editor of both the Agonist, and FDL.  While at both jobs, advertising income wasn’t my responsibility, except indirectly (I was responsible for traffic), I kept an oar in and an eye out.

Here’s the deal: advertising revenue collapsed.  In particular it collapsed in 2007/8, and it kept collapsing.  The reason it collapsed is that in the old days you sold your ads direct, or through brokers who offered good deals.  As time went by, however, the percentage offered dropped and dropped and dropped.  The brokers consolidated, and one broker took the lion’s share of the market: Google.

The reasons are simple enough: Google can offer the widest portfolio of websites to advertise on, and for all but the best branded websites, it determines more traffic than any single other factor.  For people with no brand, it determines almost all the traffic.

Google takes the value because Google takes the value of websites: content creators don’t matter for squat because without Google they don’t get read, or watched.  Oh, there are some exceptions, websites with a large enough community to provide their own traffic and push (Facebook, YouTube, etc…), but for the long tail and even the lower part of the fat end, Google is it.

I bring this up because of the extraordinary open letter from a German publisher about Google. 

“We are afraid of Google,” Dopfner wrote. “I must say this so clearly and honestly since scarcely one of my colleagues dares to do this publicly. And as the biggest of the small fry, we must perhaps be the first to speak plainly in this debate.

“The discussion about Google’s power is not a conspiracy theory propagated by people mired in yesteryear,” he added, noting that Springer is making a big digital play and now reaps 62 percent of its profits from digital business.

Attacking what Schmidt had characterized as Google’s willingness to compromise with the European Commission over a 4-year-old complaint about its practices, Dopfner declared: “This is not a compromise. This is the introduction, sanctioned by an E.U. authority, of that kind of business practice which in less honorable circles is called extortion.”

Google is remarkably similar in important ways to Walmart.  If it doesn’t carry your goods, or sticks them in a lousy place on the shelves, you aren’t going to sell much.  The information problem in economics has absolutely not been solved, people cannot find what they would actually want to read or buy, but only what a few key companies show them (see Apple’s App Store for another example, or Steam, both of which take 30% in exchange for giving people a lottery ticket to make some money.)

This is pure rent-seeking, pure skimming off of other people’s work, and while it makes a few companies obscenely profitable (Apple doesn’t even know what to do with all the money it’s sitting on) it destroys businesses. If you have to pay 30% to someone simply as the price of getting your product before consumers in theory (often not in practice), a lot of businesses simply become unviable, and the jobs at Apple or Facebook or Google do not make up for all the jobs they kill.  If Google doesn’t serve your website in the first few pages, it’s not going to be read.  You will make a deal with Google (if you’re big enough for them to care) and you will create your content to pander to Google’s preferences as embodied by their algorithms, or you won’t get traffic, and even if you do get traffic, well your ads don’t pay squat, because Google takes almost all the profit.

Companies like Google, the key App stores, Walmart and so on must be heavily regulated, and the amount of commission they can take must be fixed by law.  If it isn’t, well, you get to read all sorts of articles wondering where the tech jobs are, asking why Instagram has so few employees, while Kodak had tons.  The reason is that tons of people are providing value to Instagram, or Google, or Apple, or Facebook, and they either aren’t getting paid, or are getting peanuts: they create content, that content has value, but because someone stands between them and the people who pay, they aren’t rewarded for the value they create.

You want a good economy again?  You want an internet economy that lives up to the early hype and which provides even more jobs than the old economy?  Break or regulate Google, Apple, Facebook and all the other gatekeepers, scrapers and information brokers.

(Oh, and reduce patents to only a few years, and enforce mandatory licensing, and a million (ok hundreds) of cell phone companies will blossom, driving smartphone prices down to a tenth of what they are today, or more.  It’s called a competitive market, and it doesn’t work in a strict protected works world.)

You can have an economy that works, or you can have a few oligopolist companies which make obscene profits and create oligarchs: your choice.

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Clown College as the Ukrainian military effort “sputters”

The Ukrainian military clearly doesn’t care enough to actually fight:

The day began inauspiciously for Ukrainian forces as they sought to establish an operating base in the city of Kramatorsk, moving in units from a nearby military air base. According to Ukraine’s Defense Ministry and a witness who spoke by phone, a column of six armored vehicles was stopped by a mob of civilians and then commandeered by heavily armed men wearing military-style uniforms.

Not willing to kill civilians: that actually speaks well of the Ukrainian military.

The East is Putin’s if he wants it.  Also, take note of the sheer competence of Russian actions, both direct and through proxy forces, in both Crimea and Eastern Ukraine.  The Russians have a plan, and are executing it more than competently right down the line.  I would say that NATO and everyone else should take note.

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