Ian Welsh

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

Explosive Growth, Vaccines And Covid Variants

By

On February 10, 2021

66 Comments

Stumbled across this chart of projected Covid growth in the province of Alberta. This is a chart of what happens IF Alberta changes nothing in terms of its restrictions and vaccine count, ALL that changes is the B117 variant becomes dominant.

If that doesn’t concern you, we aren’t looking at the same chart.

The good news is that it appears that vaccines do reduce transmission and Pfizer, at least, work against B117. What that means is that in order to crush Covid we are either going to have to get almost everyone vaccinated or we are going to have to do a proper “Zero Covid” lockdown. There are other variants, as well, and the data against the South African variant is not as good, so it may be that vaccines may not do the job at all: they may deal with original Covid and B117 but mutations continue.

If that’s the case we will only get this under control with severe lockdowns and travel restrictions of the sort that most countries outside of Asia have been unwilling to do, plus wide-spread vaccination. mRNA vaccines have fast design times, and if we are willing to risk them without trials, and we are willing to force sharing of the design and production knowledge, we might use fast-turnaround vaccines to help against Covid.

The risk here is that Covid becomes endemic, a new normal, like the flu, never truly under control, but much more dangerous. This also may lead to a world where travel never recovers properly, especially between nations which have taken the disease seriously and dealt with it, and those which have not, like America, most of Europe and Canada.

To avoid this we need to stop dancing around. Break the vaccine patents and force sharing. Recompense the companies involved, a few tens of billions is all that is needed and is trivial to major governments. Go to CovidZero. And get vaccines into every arm.

One piece of good news is that the Russian vaccine, Sputnik V, a traditional vaccine, is 92% effective: only 3% less than then two mRNA vaccines. It doesn’t need very cold refridgeration and it doesn’t have the unknowns of a new tech. I would suggest, at least for the moment, to push it heavily for populations who are vaccine hesitant: it’s still a vaccine, but not an untried type.

The other point that should be made is that we need to defeat this in every country to be truly safe, and that means vaccines and support for poorer countries. Supply bottlenecks because a few companies and countries want to maintain IP laws are insane; they could leave us with a permanent disease problem which will hurt the economy for decades to come. This is yet another example of how we are unable to plan more than for a few weeks to a year or so in advance, no matter how important the issue.

For my readers, I reiterate that:

Be careful out there. Don’t be stupid, take what precautions you can, and be as safe as you can. I know for many of my readers, who work jobs that just aren’t safe, there are limits, but Covid isn’t over and I’d like for you to not get sick, get long Covid, or die.

This isn’t over yet.

All the content here is free, but subscriptions and donations do help, a lot.

 

Bitcoin Is Reactionary Money

By

On February 8, 2021

27 Comments

This is only the second time I’ve written about Bitcoin. I have friends who have done very well off it, and Bitcoin’s fans are fanatical about it. This post will probably get more hate than everything else I’ve written combined.

The reason they’re fanatical is that it’s made many of them filthy rich, for doing nothing but being a first mover and HODLing (holding.)

Bitcoin’s original selling-proposition was a good one: peer-to-peer money; cut out the middleman. This is something which needs to be done, because the middlemen regularly abuse their power by shutting people they don’t approve of out of the system. This is true on the national levels, with sanctions, and true on the individual and corporate level. I remember when Visa, Matercard and PayPal all cut off Wikileaks, for example (long before 2016). They regularly cut access off from companies selling legal goods they don’t like (for example, various nootropics, or soft-porn.)

So a way of getting past these gatekeepers, whether sovereign or corporate, is needed, as those gatekeepers regularly abuse their power.

The problem is, to quote Stirling Newberry, that the bitcoin is the worst way to do something necessary. It has massive transaction costs, in terms of energy, and thus is bad for the environment. But, as money, it is reactionary money: it was designed to have 21 million bitcoins max, with less produced over time (halving rewards).

What this means is it vastly rewards early-movers. The sooner you got in, the more money you made. The people who made the right decision in the  past, control the future, much as the families who were rich in Florence in the 15th century are rich today.

This would be great if making one important decision good for yourself meant you would always make good decision in the future that were also good for other people. Money is power and people with more money have more power. Bitcoin creates a new power bloc: those who got in early.

There’s no reason, however, to assume one good decision for yourself means you will make future good decisions that are also good for other people. (At the extreme end, Genghis Khan says hi, and so does every other successful conqueror. So do the people who crashed the world economy in 08, but got bailed out.)

Bitcoin is deflationary: it gains value over time (assuming it doesn’t crash). Deflationary money is not good money. It restricts what can be done with it, rewards dead money (people who just sit on what they have), and empowers (again) people who won the past, not people who are doing good things in the present.

There is also the matter that bitcoin isn’t acting like money. It’s acting like a speculative resource bubble, which is because it is a speculative resource bubble. Making bitcoin is called “mining” for a reason: it was modeled after gold, except that unlike gold, you can’t find more of it once it’s done. It was designed to be GoldPLUS, for people who want to win once and be secure forever.

Its other great feature (which is fool’s gold) is that it can be used to bypass government restrictions. Or so fools think, since it’s a blockchain and every single transaction is recorded. Do NOT use bitcoin to pay for anything the government might one day want to track you down over. Use cash or a cryptocurrency engineered for privacy.

The question here is what’s going to happen when BTC is mostly mined out (mining the last block may take quite some time but it will be mined out before that. Twenty-one million coins can be mined, of that 18.5 have been mined.)

What happens to the value when the first mover advantage is gone? When it’s “mined out?”

Well, that depends on if there’s a genuine use-case. Is it a functional peer-to-peer payments system which lets you bypass both censorship and high fees? Right now, bitcoin is slower than many normal transactions. When mining ends, fees are expected to go up (since miners currently subsidize them while mining) and it isn’t actually anonymous money: in fact, given the ledger that permanently records every transaction, it’s almost perfectly engineered to be a totalitarian technology.

That said, what I see possibly happening is that it does stick around. Paypal is bringing it online, for example. Most people don’t hold much BTC in this future, they simply use BTC as a transaction medium, renting it, in effect, from the big HODLers. The lightning network also promises to speed up and cheapen transactions, there can be fixes to the transaction issues.

The other possibility is that once it’s no longer possible to get rich, we find out this is a bubble and a ponzi scheme. The first movers who were smart enough to cash out along the way do great and the bubble bursts. (If I were a big HODLer I’d hedge: cash out about half and buy off-chain assets, keep the rest in case BTC sticks around as infrastructure.)

Much of this depends on legal status and institutional support. Contrary to what a lot of BTC maximalists think, BTC can absolutely be shut down if enough big governments decide to do so. Set the forensics on the transaction chains and make its use illegal, subject to penalties or even jail time and yeah, that will destroy much of the value. It’s only a store of value if you can turn it into real world goods. If you can’t, it’s just a digital asset, worth less than a high level MMORPG character.

All that aside, the main issue is, again, that it’s reactionary money, intended to create a new class of winners who are then protected by the fact that they got in early enough, by the design of the coin itself.

It’s why BTC worked: because it was designed to create a protected asset class that rewarded first movers. The utopian stuff is overstated (because of the ledger). BTC is a greed project dressed up in idealist clothes, which doesn’t mean many people don’t genuinely believe its utopian promise. (Much as big capitalists constantly say how wonderful capitalism is for everyone and how they deserve to be rich because they make life better for everyone.)

All that said, I like a lot of BTC people I know and if it’s something of a scam, well, it’s not one-one hundredth as bad as what Wall Street does every day. In a world where almost all fortunes are illegitimate, based on scams or hurting other people, BTC at least gave some people outside the usual class a chance to get rich or make a bit of extra money.

All the content here is free, but subscriptions and donations do help, a lot.

Week-end Wrap – Political Economy – February 7, 2021

By

On February 7, 2021

51 Comments

Week-end Wrap – Political Economy – February 7, 2021
by Tony Wikrent

Strategic Political Economy

If There’s No Fear of Inflation, Why is GOP Against More Stimulus? – Rana Foroohar and Mark Blyth — Transcript here

​​​​​​​Mark Blyth. ….arguing about deficits is just a footnote on the wider agenda of power for the sake of power. Why do they do this? Because they know that existentially Republicanism has run its course. As Rana just said, there’s only so much you can give to business before they’ve got everything, which is pretty much where we are now. There’s nothing more to give. We need huge amounts of infrastructure repair. We need huge amounts of social investment in the economy and elsewhere. And this is anathema to everything the Republicans have stood for and delivered on for the past 30 years, which is simply more money for me and to hell with the rest of you. So they’re not going to turn this around….

Rana Foroohar. I completely agree with that. And I think it actually brings up something I’m quite worried about, which is the fine line that the Biden administration has to walk right now in executing even part of their Build Back Better, Reward Work Not Wealth strategy, without creating such a bumpy ride from here to there that the Republicans can say, well, look, look what Joe Biden did. Now the markets have crashed… because if you think about what we’re trying to do, if we pull way back, this administration is trying to shift the American economy structurally from being an economy that is based on debt and asset price bubbles to one that is based on income and wage growth. And that’s a laudable goal. But it’s also like turning the Titanic.

….you might actually know when the markets crash that things are getting better in the U.S. economy because certain things have to be done. Raising taxes on companies, the labor share rising, some of the push for union labor that’s coming with the Defense Production Act. All of that is going to dampen profits. It’s going to frighten investors and the hot money is going to run.

Read More

Open Thread

By

On February 6, 2021

57 Comments

Please use the comments to this post to discuss topics unrelated to recent posts.

Default to Kindness

By

On February 4, 2021

41 Comments

If there is one policy point I’d like to make it isn’t a policy point, it’s an ethical one: default to kindness.

Or try kindness first.

In policy terms, the kind thing to do is usually the right thing to do.  I’d go so far as to say, almost always.

Treating prisoners with kindness nets Finland half the recidivism rate the US, with its punitive prisons gets.  That is, only half as many prisoners, once released, commit a crime in Finland.

Single payer or comprehensive universal healthcare has costs about a third less than the US system, and produces better results.

Not committing war crimes makes people much less interested in killing you.  Not torturing enemies means they are far less likely to torture your people.

Helping other nations improve their standard of living makes them less likely to kill us, and better trade partners.

Happy employees are more productive and produce more profit, yet we deliberately treat employees horribly in the assumption that we get more out of them that way, despite reams of evidence to the contrary.

High minimum wages do not decrease employment, there is even some evidence that they may increase employment.

Torture does not get useful information out of people compared to regular interrogation.  It is extremely unreliable, this is understood by most professionals in the business.  You torture to send a message, and that message is “we torture”.

The first thing you should do, in any policy situation, is ask “what would the golden rule have me do?”  Most of the time, this will be the correct policy, which will produce the best results.  People who are treated with kindness, in general, reciprocate and are productive.  Yes, there are exceptions, but they are just that, exceptions.

Further, kindness is the default position even with the worst people.  If you allow rapists to be raped, you become a rapist.  If you torture torturers, you are now a torturer.  You do not, in the old phrase, sink to their level.  That doesn’t mean being a pushover, it doesn’t mean no justice, it does mean that the State has no business seeking revenge and that the rules, which should default to kindness, apply equally the worst people and the best.  This is not just the right thing to do, it is the only thing to do, because the State often decides the best people are the worst people, as even a cursory examination of history will attest, and it very often makes mistakes, as the many errors in capital cases have brought to light.  But, again, even if someone is the worst of the worst beyond even the shadow of a doubt, they must be treated with kindness even as they are incarcerated, not just because it is the right thing to do, but because doing anything else degrades those who do it.  Torturers are always corrupted by torturing, occupying armies always become weak, corrupt and brutal.  You cannot do evil and not be, yourself, scarred by it.

Be kind, and remember, what you insist on your government doing to others changes your government, and will effect its treatment of you.

Originally published Nov 26, 2012. In some ways this is the most fundamental piece I’ve ever written, or ever will write.

All the content here is free, but subscriptions and donations do help, a lot.

AOC Is Right About Hawley and Cruz & America Is A Coup-able State

By

On February 3, 2021

122 Comments

Hawley and Cruz encouraged the January 6th riot.

That riot put AOC and other Congresspeople and staff’s life at risk. They were lucky to escape. We know that one rioter was texted that Congress had fled to the basement and that he was to turn on the gas and kill them.

It was a coup attempt. Because Trump is incompetent and tends to hire incompetents (with a few rare exceptions), the coup failed. The army wasn’t onside, only a few cops were willing to help, and so on. The best the coupsters could do is make sure that the outnumbered cops weren’t reinforced by more police or by the national guard.

Anyway, if AOC had been caught by the crowd, the best she could hope for was a beating. The crowd wanted to kill Pence, their own VP, as a traitor and AOC has been far more vilified than that. A beating would be the best case, death after some horrible abuse is the more likely case.

So AOC is right, and since she understands, correctly, that Hawley and Cruz and some others were part of making the riot/coup happen, she doesn’t want to work with them. After all, they did something that could easily have gotten her beaten, raped and/or dead.

It is also true that since there have been no consequences for those who aided, planned and abetted the coup attempt, just for the suckers they used, so there may be another one in the future. She is correct about that also.

What is not true is that this is particularly new: my judgment is that Bush Jr. could have pulled off a successful coup, he just chose not to. He would have had the military onside, and while he was personally suffering from some sort of brain damage, he had many subordinates who were, in their own narrow ways, competent. They knew how the bureaucracy and power works, and were brilliant at making it do what they wanted. The 2000 election was unquestionably stolen, and that was a coup without the theatrics.

America’s met the social conditions for coups for some time now.

In the present, however, it is also true that Cruz and Hawley; Hawley in particular, remain possible votes for things that AOC will want passed. Hawley pushed $2,000 checks hard.

Some of what Hawley wants done will help AOC’s constituents avoid poverty or death. This is a conundrum, and it is best answered by accepting their votes but not letting them take lead if at all possible. Hawley wants to be President, and AOC doesn’t want a man complicit in a riot/coup that could have killed her to have that sort of power. This is reasonable.

What happened January 6th was serious. It is not best answered the way that our political elites are answering it, with an increased security state which will not work when the threat is, as the horror movie line runs, “inside the house.”

But those who are mocking AOC for her fear and for her determination to not work with those who encouraged Jan 6th are missing the actual danger she was in. The protestors beat a cop to death, who they had nothing personally against. They’ve been indoctrinated to hate AOC.

And AOC is right that people who face no consequences for a coup, may well try again if they see no other way to get what they want.

But the problem is too far gone. The correct response is to expel those members and Senators involved, but since Congress operates on an entirely partisan basis, with no actual institutional or democratic loyalty, that is not possible.

This is part of why I say the US is in a pre-coup state: that the conditions are met. The responses required to remove the conditions are not possible.

In the meantime, there is a crisis, and it will be used, as all crises are, to do what those who actually have power wanted before anything happened: crack down on the internet, increase police state powers and so on.

And the abuse of the population, by both parties, will continue, until an elite faction does manage a coup, using the resentment that Democrats and Republicans have built and earned over the years as fuel, OR until America finds a way to be good to the majority of its population.

All the content here is free, but subscriptions and donations do help, a lot.

Biden Is Determined To Lose Congress In 2022

By

On February 1, 2021

89 Comments

One thing I admire about Biden is his principles. He’s spent his life hurting little people, and something as minor as holding Congress isn’t going to make him change his ways now. Make a promise, win an election, break your promise in the most weasely and public way possible.

I’m talking about $2,000 checks. There is no question this is what Democrats promised if Georgia elected two Democratic Senators.

And Biden promised this specifically:

A day before Georgians head to the polls to decide control of the Senate, President-elect Joe Biden sought to cast the election as a choice between immediate stimulus relief or months of gridlock, promising that victory by Raphael Warnock and Jon Ossoff would mean $2,000 stimulus checks would be sent out “immediately.”

After Georgia did, indeed, give Biden two Democratic Senators and control of the Senaate. Biden walked this back to $1,400 — saying that the previous stimulus bill had already paid $600. Now he’s been saying that perhaps the checks should be means tested, so only some people will get $1,400 checks.

This is all weaseling. It is recognized as such by ordinary people. Biden is proving that he simply can’t be trusted to do what he says, when he makes a clear promise.

Now perhaps the bill can’t pass: perhaps. But you still do it: you bring and simple up and down bill with only the checks and make people vote for and against it. Odds are some Republicans will vote for it (Hawley, for one) so you can lose a Democrat or two.

Failure to do this will be remembered. People thought they were going to get $2k, they aren’t going to get it, and they will hold a grudge on this. No ordinary person will trust a word Biden says from this point on.

Nor should they.

Billionaires, on the other hand, will find he remains a good friend.

All the content here is free, but subscriptions and donations do help, a lot.

Week-end Wrap – Political Economy – January 31, 2021

By

On January 31, 2021

30 Comments

Week-end Wrap – Political Economy – January 31, 2021
by Tony Wikrent

The Impeachment and Trial of a Former President (PDF)

Congressional Research Service, via Naked Capitalism 1-27-21]

Here’s the full list of Biden’s executive actions so far

[NBC, via Naked Capitalism 1-27-21]

Strategic Political Economy

This is How You Recover From Fascism — and America’s Not Doing Any of It

Umair Haque, January 26, 2021 [Medium, via The Big Picture 1-29-21]

….Fascism always has economic roots. Always. American pundits still don’t want to discuss that, because then they’d have to admit they were wrong about the economy for decades — and they’ll never do that, because then they’ll look like the fools they are.

Think about Germany. How did “it” happens here? Because the Weimar Republic fell into poverty. The average German, expecting a stable and secure life of relative prosperity, instead experiences sudden, sharp, downward mobility. Old racial hatred suddenly resurfaces. The Jews were blamed for the travails of the average good German — they have always been the enemy within. Who else was responsible for all this poverty and despair and ruin — except the hated minorities who had always been poisoning us from the inside?

That’s exactly the story of modern day America, too. The American middle class finally began to implode around 2010, after have a century of stagnating wages, while costs like healthcare and education and food and housing exploded year after year. The average American — the white one — expected the life he or she was promised: a suburban dream of easy, thoughtless prosperity. Instead, what they got was blighted cities, an opioid epidemic, half of all Americans trapped in “low wage service jobs,” trips to the doctor that cost as much as a house. They experienced just what Weimar Germans — sudden, sharp downward mobility. They might have tried to hide it by buying McMansions on credit, but the economic facts tell the true story: the average American by 2015 or so lived in a new underclass, couldn’t raise a tiny amount to pay for an emergency, lived pay check to paycheck, and died in massive debt.

Read More

Page 234 of 532

Previous

Next

Powered by WordPress & Theme by Anders Norén