Dope


LI doesn't usually read the NY Press for pretty articles -- we skim the controversialists, and move on. But this week, there is a very nice little article about Writing in New York: and no, it isn't some damn take on Jonathan Franzen's earmuffs. It is about the very civilized sounding NY Society Library. Lincoln MacVeagh, the writer, is happy to indulge in the causerie that Joseph Mitchell perfected -- a NYC stroll among odd fellows. Well, we think that form is un-improvable. Here's the first three grafs:

"Anthony Trollope didn�t need a writing desk; he was perfectly happy composing his novels in crowded train compartments. Not every writer possesses such power of concentration. Virginia Woolf insisted on several thousand pounds and a room of her own before she could get on with the job, and it�s my guess that most of us are more like Mrs. Woolf than Mr. Trollope.

The trouble is, it�s not easy to find a room of one�s own. Manhattan apartments don�t come with spare bedrooms, and renting an office at $1200 a month is out of the question. So where is a writer to write? One answer is the New York Society Library at 53 E. 79th St.

Founded in 1754, the Society Library is open to the public and membership costs $150 a year per household. It houses a good collection, a magnificent reading room and an elevator that is as elegant and temperamental as a Park Ave. hostess. The library opens at 9 and on any given morning you�ll find a handful of authors waiting outside to start work."

It sounds so much more civilized than our quarters. LI writes on a heavy office desk, one with black, pressed metal drawers crammed with drafts, envelopes, cds, pennies, letters and forms that we were urgently requested to fill out years ago, and that we didn't, and, far back in the top left hand drawer, a condom in plastic wrap, which, we believe, was given out at some long ago SXSW event. Our efficiency apartment is one of those rooms that never seem to get enough light, or get the light right -- somehow it always falls in some slightly irritating, oblique way on the page, which is a real bother for a person whose living consists of reading books and writing about them. If this sounds like the genteel life, it is certainly not: it's assembly line work without dental. I recently estimated that, in the past three and a half years, I have reviewed over four hundred books. At an average of 300 pages each, that comes to what, 120 thousand pages? Plus the books read to supplement those reviews -- research and such. Plus books read for enjoyment. So you can see that the question of light, far from being an aesthete's pre-occupation, is more in the nature of an occupational hazard.

On the topic of writers we are reviewing: we've been enjoying the marvelous autobiography of Anthony Burgess, Little Wilson and Big God, which we are reading, natch, in preparation for a review of Burgess's upcoming bio. What we like about Burgess -- what we love about Burgess -- is his luxuriant, sprawling, variegated, I don't give a damn English. It is nice to read a man who is not afraid that the dictionary's going to bite. Here he is, going on about having a childhood case of scarlet fever:

"My stepmother, knowing my disease was damnably contagious, was more anxious to shoo me off the premises than solicitous about my headache and nausea. Dr. Sneddon wound the handle of our extension telephone and told 21 Princess Road (Moss Side 1274) to call an ambulance. Anges shrieked "Me baby!" at the other end (I had played with the child the day before) but was calmed. I was taken to where I started -- northeast Manchester, Monsall Isolation Hospital, between Monsall Road and Northhampton Road. There, while I desquamated, I completed my primary education."

A lesser writer would have crossed out 'desquamated'. I had to look it up. It means to shed skin. It is a word I am now proud to know -- that "squa-" sound, as in sqalid, with the denunciatory de-, reproduces the sickly squirm of the skin shedder. It made me think of a recent piece by Jonathan Franzen on William Gaddis that was in last week's New Yorker.

Franzen's essays, lately, remind me of the title of one of Norman Mailer's books: Advertisements for Myself. Except with Franzen's coy grad school mannerisms the title should be: Valentines to myself. The man is incorrigbly smitten, and writes as if he was taking himself out on a date. He's cute, he impresses himself, and at the end of the evening he presumably gets to third base with himself. But that's something I just don't want to know. Neal Pollack's parody catches that perfectly. In any case, Franzen begins the essay (the burden of which is a general, essentially not very smart condemnation of Gaddis' work) with a letter he received about The Corrections from a woman who noted down four difficult words used in it, and asks: who are you writing for, the sophisticates who read the New Yorker? Then she calls him an asshole.

Franzen doesn't have the wit to say: no, I'm writing for people who read the Reader's Digest; which, after all, features, or used to when I was a kid, a monthly vocabulary builder. I loved that vocabulary builder. A large vocabulary, like a free public library, used to be one of the signifiers of the autodidactic blue collar class. I come from that class, or a region just a bit above it. So did Anthony Burgess. The old socialist dream of the commons -- riches for everyone -- still guides my politics, and I believe the Readers Digest vocabulary builder is a spar from that shipwrecked Utopia. Autodidacts of the world unite, you have nothing to lose but your standing in the minds of Jonathan Franzen's sillier readers -- among whom, sad to say, I count Jonathan Franzen himself. The common readers first book, and last book, will always be the dictionary. Only a intelligence that has permanently stooped to pander to power equates the common reader's taste to the kneejerk anti-intellectualism of the bogus populist.

Remora

Isn't this sweet? Outgoing senator Phil Gramm -- that's what all the news releases say -- is set to join UBS Warburg:



ABC News announces it in the easy tones that embody the flow of senatorial personage to business personage and back:

"Senator Phil Gramm will soon become vice chairman of UBS Warburg, the investment banking arm of Switzerland's biggest bank, UBS Warburg said on Monday.Gramm, who will take up the private sector post when his Senate term ends later this year, follows a well trodden path of key legislators who join top Wall Street firms. Gramm has been in Congress for 24 years, and co-authored far reaching legislation in 1999 that repealed a prohibition on companies offering banking, brokerage and insurance operations under one roof."

Curiously, nobody connects a few dots. So Limited Inc will take up the pencil. How about this?

1. Wendy Gramm serves on the board of Enron. Preceding this nice little sinecure, she sits on the Commodities and Futures Commission and gives Enron a nice little waiver to embark upon its energy trading business without any pesky federal regulation. After eight years and about 600 thousand dollars, Wendy, on the Accounting committee of the Enron board no less, is shocked, shocked to learn that the company has been looted as thoroughly as the Russian looted Berlin, circa 1945.

2. But as that looting is drawing near its close, certain high up personages in Enron have not wholly given up the idea that, in the last moment, they can lick the spoons. Greg Whalley, among this seedy crew, is operating, supposedly, as Enron's President. It is his decision to reach in the piggy bank and award compensatory amounts up to a million dollars a piece for the people who are sitting at Enron's energy trading desk -- which, you'll remember, was made possible by Wendy Gramm's fortuitous waiver. He justifies these awards by going on about necessary personel, and the need to keep them from jumping ship. Of course, he doesn't allude to the vulgar fact that the energy trading desk has been losing money hand over fist. Or that the compensation comes directly out of the hide of the older workers in the gas pipes division -- yokels all.

"A top Enron executive wrongfully allowed employees who stayed with the company to cash deferred-compensation claims worth at least $32 million, while denying similar payments to former employees, legal experts say. And the experts said one-time Enron Chief Operating Officer Greg Whalley may well be personally liable for the payments distributed in October and November. A lawyer for Whalley recently told the Chronicle that his client had allowed dozens of company executives to cash out their deferred-compensation plans because they were still "providing value" to Enron. But retirees and other ex-employees who sought to cash out at the same time, or earlier, did not get approval."

3. Well, what is a hardworking president to do? Got to keep the energy section going until you can sell it, and yourself with it, to some lucky company. And guess who that company is, sweethearts? Why it is UBS Warburg: here's the announcement, dated February of this year, in Computerworld.

"A wholly owned subsidiary of London-based UBS Warburg, which is itself the investment banking subsidiary of Swiss bank UBS AG, the re-formed energy exchange has acquired Enron's gas and power trading IT infrastructure, its intellectual property and 625 of its former employees (see story).

"When the sale was finalized [Feb. 8], those people became UBSWenergy employees," said company spokeswoman Jennifer Walker. Most notable in the group is former Enron President and Chief Operating Officer Greg Whalley, who rose to that position in August after former Enron President Jeff Skillings left unexpectedly."

4. And so now Senator Gramm, the honorable Senator Gramm, who seems to have slipped through this awful mess that must have, just must have been caused by government regulation (ask the guys who write the editorials for the Wall Street Journal) with his wonderful wife Wendy by his side, unbowed by her experience and comforted, perhaps, by that half a mil she earned for two weeks work a year, is headed, by coincidence, for the refuge of the high end final Enron looters. Quelle coincidence! Not that we are accusing anybody of striking a deal, especially not good old dirty fingered, corrupt, cheating, lying, stealing, black hearted, selfish, conniving, worthless Phil Gramm -- as we like to call him, jokingly, in Texas. We simply think that it is, indeed, a small world after all, and one in which Phil simply keeps running into people he's helped out, and who want to help him out in turn.

Remora

The chatter between members of the governing classes, up to June of this year, had been that Lula da Silva, the labor candidate for president in Brazil, had to be defeated. The threats became as thuggish as the manicured set gets. Here's what George Soros had to say:


According to Rossi's reporting, published on June 8th in a major Brazilian daily newspaper, Folha de S. Paulo, the markets believe that Luiz In�cio Lula da Silva (the leftist candidate, of the Workers Party, or PT, who is well ahead in the polls) will default on the debt payments if elected. Thus, says Soros, the markets are already betting against Brazil, specifically against the Brazilian currency, the real. If Lula indeed wins in the two rounds of the elections, scheduled to happen on October 6 and 27, the financial situation would be so dramatic that he wouldn't have any option other than defaulting on the debt.

Faced with the intrinsic totalitarianism of such prophecy, Soros acknowledged it, and added: "In
Ancient Rome, only Romans voted. In modern global capitalism, only Americans vote, Brazilians do not."

Soros, much celebrated for the beautiful sentiments about civil society with which he often perfumes the air, gets down to brass tacks here. Even vampires who read John Locke, at the end of the day, want their quota of vein.

However, a change occured after that interview. One wonders if there was a sense that one had been, well, a little too bold. The new line is that Lula is a poodle leftist, in the Tony Blair mould. Indeed, this is a good bet: in the U.S. in the nineties, and in Europe right now, a vote for the left almost guarantees economic policy from the right. The technocrats of the left are bored with labor. They are definitely bored with the urban poor, and their intractable problems -- best to solve them through massive police sweeps. What the technocrats of the left like best are to be interviewed for the Financial Times, and praised for their "bravery" in standing up to (otherwise known as betraying) their constituencies.

This is the line taken by Franklin Foers in The New Republic (an article that is not, alas, on-line) After explaining that Wall Street is "freaked" about the prospect of Lula, Foers provides the reassuring contrarian note:

"The markets have cause for displeasure: None of Brazil's three candidates are fervent devotees of the Washington Consensus. But their fears of Lula are out of date. The IMF bailout conditions $24 billion worth of loans on budget surpluses, severely limiting any future president's inclination toward reckless spending. What's more, Lula isn't significantly more protectionist or anti-globalization than his competitors. In fact, unlike Gomes and Serra, who are scrambling to move beyond their center-right bases by pandering to working-class resentments, Lula is moving to the center in a bid to win over skeptical middle-class voters. Ironically, the onetime radical may be the best hope for neoliberalism in Brazil."

Well, yesterday was the first step in Lula's probable ascent to the presidency. Here's the NYT:


"Mr. da Silva had never won more than a quarter of the first-round vote in three previous attempts at the presidency. Though he forced a runoff in his first try, in 1989, voters in the past have always been suspicious of his party's socialist platform and questioned his qualifications for office. For this campaign, however, Mr. da Silva revamped both his image and his program. He backed away from earlier threats to repudiate Brazil's foreign debt and to break with international lending organizations like the International Monetary Fund, emphasizing instead measures that would allow Latin America's largest country to export more and therefore generate more jobs and growth.

Mr. Serra, in contrast, as the candidate of the multiparty coalition that has governed this nation of 175 million for nearly eight years, has had to bear the burden of popular dissatisfaction with rising unemployment and a stalled economy. He has also been seriously weakened by disarray within the government camp and by and his own lack of charisma compared to Mr. da Silva."

One of the questions that has to be hanging here is: how is one to deal with an international financial system that did what it did in Argentina? That is, found a system of inefficiencies and left a desert? If it wasn't obvious before, by now the end of history thesis so beloved of the globalization crowd has been stripped of its pompous Hegelian subtext and laid bare for what it is: a collection note from a debt collector. Argentine debt, looked at in the light of day (a block of hours much deplored by the Vampirish set), has a somewhat freakish appearance -- what on earth induced the international lenders to loan out that much, and what on earth induced the government to take that much? Obviously, it was a way of paying for the New Deal State while installing the Chilean state. While, in the U.S., eight trillion dollars can evaporate in three years (as they have, in the markets) and the cars just keep on selling, Argentina doesn't have that scale. Whether the U.S. will continue to have the leverage of scale is a question the Soroses of the world don't want to ask right now. Brazil, in the eighties, famously leveraged its position as one of the grand debtors in much the way English dukes used to leverage their gambling debts at Harrolds. But if there is a capital strike against Brazil -- and the odds are pretty good that there will be one -- LI wonders if that gambit will work.

That is a sad note to end on. We aren't actually that pessimistic. We are rather cheered by Lula's victory. But our political anhedonia, right now, is nearly terminal.

Today's post.

Dope.

No. Not today. The Enron news comes thick and fast, and you know how LI laps this stuff up -- it is our personal financial porno, wish fulfillment that overwhelms the senses. Etc. But isn't it the better portion to resist the snares of the devil, especially when the devil comes bearing such unbearable proofs of the correctness of one's world view?

Surely our world view is not all that correct. Surely there's something diabolic going on here.

We try to diversify our little posts when we can. Actually, we had planned a post on Marilyn Monroe this week. Over the weekend, we watched the Seven Year Itch with our friend, S. We also urged her to see Some Like It Hot -- which she did. She was impressed by Jack Lemmon in the latter, and she laughed at the former, but in neither did she find Ms. Monroe the "stradivarius of sex," as Norman Mailer once pronounced that ill fated woman. Our friend S. doesn't cotton to the "flighty blond" imago -- which would put the keebosh on appreciating Marilyn.

Ourselves -- well, when I was a little boy, with a hey, ho, nonny nonny ne, I used to watch Monroe movies on Channel 17 in Atlanta, Georgia. Of course, I was learning, like any true American adolescent, to connect the hormonal dots with the help of visual aids, and she was a nice visual aid. But I like to think that even then I had a budding, so to speak, sense of what movies were about. Cinematic possibility imported into my own life, that was what they seemed to be about. You watched a movie in a theater, and the very bigness of the screen, the scale of sound and sight, guided you outside of that viewing -- it gave you a sense of how you could manipulate your own scale in the world, a sense for the action of the sensibility on the deceptively inert appearance of things. So, for example, some like it hot gave me the idea that someday I could troop around with scantily dressed chorus girls; it even made me see the girls in the seventh grade as possibly scantily dressed chorus girls, given the right circumstances. This is important -- those who lack any intuition of how fantasy can bend the world are not more careful judges of what exists, but the worst judges -- they walk through a world of locks without keys.

Yet when I watched Seven Year Itch this weekend, on S.'s tiny tv, I experienced this odd thing, this thing I've been experiencing whenever I see a film that was made more than twenty years ago -- I am more interested in the things that existed then, and their evidence in the pans and takes, than I am, really, in the content of the film. To give you a for instance -- S. and I saw The Blues Brothers a couple of weeks ago. The plot of the film was even worse than I vaguely remembered. But what moved me almost to tears was the introductory shots, which showed Chicago from the air. Guess what? Chicago, at that time, still had patches of industry. There were factory chimneys spouting smoke. Just this little factum seemed so intensely interesting to me -- filled me with such a sense of loss, and of time itself -- that I didn't really follow the rest of the movie.

The Seven Year Itch, with its lubricious/silly jokes about straying husbands, and its New York City without a/c, did not thrust its facts on me with the same force. It was an imminently theatrical film. The fact that slowly, slowly filled me with that sense of loss was more a social fact -- the existence, even in caricature, of this kind of culture, this post-war prosperity, that has been so radically altered that it doesn't really exist any more. Yes, I get my Proustian kicks watching b&w films. S., who is so much younger than me, is immune to this nostalgia.

It is one of the gifts of middle age. Alas, the term middle age is so loaded with unfortunate connotations that my readers will probably take me to be meaning something deeply ironic. I'm not being ironic. You don't really understand the past, I think, until you reach middle age. That in itself makes it worth being forty-four.

Okay, since this does seem to be vaguely about Marilyn Monroe: on the Monroe front, we found several articles, each more ridiculous than the other -- this, too, is a tradition that stems from Mailer's Monroe biography. We quite like that bio, but there's rather a disconnect between intelligence and subject in the book -- reading it is like watching a nuclear reactor being attached to a tricycle, the high tech artifice and energy of the one having little to do with the elementary mechanics of the other. The prize for the most ridiculous hommage to Marilyn surely goes to Andrew O'Hagan's St. Marilyn, an article that appeared, all moist and coldcreamed, in the London Review of Books.

O'Hagan, like every writer on Monroe, seems impelled to put his arm over her shoulder. He starts out with a rather pat, and at the same time absurd, juxtaposition of St. Theresa and Marilyn Monroe. The connection here is that both leave relics... Well, undoubtedly, there are relics of saints and there are autographs, pearls, and chattels of dead stars that end up at auctions. But sainthood is not defined by the reliquary. I imagine you could make the argument that the believer's relationship with a saint is similar to the fan's relationship to a movie star, but I think the comparison is way to broad. It ignores way too many social relationships, including the role of the church. The kind of thrill the buyer of Marilyn's letters gets is not, I think, the same thrill experienced by making a pilgrimage to Lourdes.

He then shifts into the classic therapeutic approach to M.M. Odd how you can't write about M.M. without taking a side:

"Barbara Leaming's new book adds to a sense of Monroe as someone in constant struggle with fictionality and mental illness, with the demands of men, and with an overwhelming wish to be taken seriously as an actress. Monroe's mother blamed her daughter for being born, and the child grew up with a dark memory of people screaming in the hall, of departures and uncertainties, and of men taking advantage of her loneliness and dependence."

I wonder what men taking advantage of her loneliness and dependence means. Taking advantage seems to hint at having sex. And the thought behind that, of course, is that the woman surrendering that sexual treasure is, of course, giving a pure gift -- one that takes from her, and gives nothing back. A token, in fact, that signifies conquest. Well, the idea that M.M. was a martyr to the male brute's desires, a blond Olive Oyl, is not borne out by anything M.M. said. In fact, she seemed to enjoy sex quite a bit herself. O'Hagan's wording, here, slots all too easily into the madonna/whore logic Freud explored in his Three Essays on Sexuality.

Here's O'Hagan, being particularly dim, I think, on the period around the time of the Seven Year Itch:

It was Marilyn's misfortune to think that serious acting could save her from self-doubt. In fact it only exacerbated it. The Girl, though certainly choking and limiting as a character, was something she knew about, and it remained for her a very special and individual invention. But Leaming is bigger and better than any other biographer when it comes to describing Monroe's terror in the face of Twentieth Century Fox's view of her.

In 1955, after showing America and the world how to relax about sex by allowing her skirt to blow over her head in The Seven Year Itch, Monroe ran away to New York to become somebody else. But The Girl would always follow her. She threw a press conference to reveal 'the new Monroe':Cocktails were served for about an hour as guests awaited a 'new and different' Marilyn. Shortly after six, the front door opened and Marilyn blew in like a snowdrift. She was dressed from head to toe in white. A fluttery white mink coat covered a white satin sheath with flimsy, loose spaghetti straps. She wore satin high heels and white stockings. Her long, sparkling diamond earrings were on loan from Van Cleef & Arples.

Marilyn seemed disappointed when people asked what was new about her. 'But I have changed my hair!' she protested. Her hair did seem a shade or two lighter. Asked to describe the new colour, Marilyn replied in a child's voice: 'Subdued platinum.' The crowd received Marilyn with good-natured amusement. They responded as though she were one of her comical, ditzy blonde film characters? 'I have formed my own corporation so I can play the kind of roles I want,' Marilyn announced? She declared herself tired of sex roles and vowed to do no more. 'People have scope, you know,' said Marilyn. 'They really do.'"

He doesn't seem to connect this trope -- sexy comedianne wishing to be taken seriously -- with its long tradition in Hollywood, and M.M.'s probable awareness of it -- an awareness inscribed in The Seven Year Itch. As for the "terror" of being manipulated by the Studio publicity machine ... as for 'showing the world how to relax about sex..." Well, as we said earlier, M.M. has an extraordinary effect on writers. She makes them go off the road, over the river and into the trees, crashing all the way.

Remora

Kurt Eichwald, NYT's man on the spot, pens one of those baffled by it all news analyses of Enron's business structure. He notices -- as man and dog tend to do, once their noses are rubbed in it -- the nature of the stuff before him, and gently cries, why, this is not gold dust!

He takes the Cuiaba project -- which we have commented about, back in January was it? -- as an example of a fools gold mislabeled the real stuff. Here's his summary:

"For example, among the examples of failed business dealings cited in the complaint is a power plant construction project in Cuiab�, Brazil. This effort, known as the Cuiab� project, was troubled from the inception, according to the complaint. It rapidly went $120 million over budget and had numerous risks and impediments to keep it from being profitable, the complaint says � problems that were well known throughout Enron.

"The Cuiab� project was so problematic," the complaint says, quoting a statement from an unidentified Enron employee who worked on the effort, "that no buyer would be interested in purchasing the project from Enron."

In the standard world of corporate endeavors, the results of the effort were easily predictable. The doomed project would have to be shut down and then written off, with the marketplace reacting to the stumble in a predictable fashion: Enron shares would drop, the company would remain in the doghouse for a few months, and perhaps a few heads would roll.

But with the partnership scheme described in the complaint, all of that was sidestepped. Instead, Enron shifted enough of the failed project to LJM to remove it from its books, in a transaction that appeared to be a sale. Through that transaction, Enron was able to recognize $65 million in income in the final half of 1999, when it was struggling to meet its financial projections."

Now, why would Enron do that?

The answer, dear reader, is that Enron was just responding to the kind of "entrepeneurial structure" people like Michael Jensen had advised in the 80s. Economists of the red meat school (you know, the ones who want to the poor to work harder in their maquilladoras over the river, so that eventually, as the soil is fertilized with their bones, accumulated over the generations, one of their great great grandchildren might enjoy the rare executive perk) -- yes, the governing classes' shock troop theorists, that is who we are talking about, in a word -- had promoted the idea that no amount was too great for the entrepeneurial exec to earn. Steve Jobs gets one billion dollars for last year? Why, he earned it. Larry Ellison walks off with seven hundred million dollars while his company wallows in shortfalls? He deserves it. These, of course, are the same troopers who we can count on to come out whenever the discussion turns towards raising the minimum wage. Heavens, that just hurts the poor!

So, what do you do? You establish a bonus structure that parallels your accounting structure. The latter is designed to make all deals seem immediately profitable, by various pathetic tricks. And that stimulates the greed gland (located south of the hypothalamus), because guess what? You get a nifty bonus on big deals like that.

Thus, one can only laugh when Eichenwald brings out the true blue market as darwinian force argument:

"But in the end, Enron and its executives were given a harsh lesson about the realities of market discipline. By failing to promptly take their medicine for the wrong-headed mistakes committed over the years, the executives allowed Enron's business problems to build up, hidden behind a thick curtain of obfuscation.Then, finally last year, when errors discovered in the partnerships required certain of them to be moved back onto Enron's books, the curtain began to part."

Right. What executives? Skilling? Out by June, 2001. Lay? Having used the company as a slot machine, by November, 2001, he'd gotten all he was going to get out of the beast. How about Thomas White, our secretary of the Army, and the presumed head of Enron's energy unit? Out by February, 2001, when his stock options were primo. The harsh lesson, here, is for the suckers, not the execs. Folks like the Enron employees who couldn't get their money out of the place when the accounting department froze their 401ks on a technicality.

So what is an exec to do if the rules of the candystore look like they are changing? Well, hit back, and sound the great themes of America, liberty and loot, uh, scratch that, justice for all. The FT has a report on the annual meeting of Pigs of America, uh, scratch that, the Business Council, an annual reunion of CEOs. This kind of gas is being vented at this event:


At the press conference to launch the event on Wednesday, he [Esrey, CEO of Sprint] and other members of the Council's committee pointed out that a combination of new legislation, tighter credit, depressed markets, and stricter regulation was stifling risk-taking at US companies."This is a climate that doesn't reward risk-taking - yet the fundamentals of business are to take prudent risks at the right time," said Carly Fiorina, chief executive of Hewlett-Packard. She said she was pleased that the group had completed its takeover of Compaq Computer already, because in the current environment "you're less likely to undertake bold moves even if you feel they're right".

Bill Harrison, chief executive of JP Morgan Chase, warned that attempts to reform Wall Street - led by Eliot Spitzer, New York attorney-general - might further weaken the sector. "I just hope we don't go too far with these things [so] that we damage what's made Wall Street great and what's made this country great."

What can one say about a JP Morgan man bitching about being investigated for penny ante stuff -- you know, bilking the greedy masses of billions of dollars and the like -- by this Spitzer fella?
Laughter in the dark, laughter in the dark.

Remora

The unwinding


LI recommends a Schopenhauerian article in the Economist today. War, depression, and a moronic leader -- it sounds like Austria in 1935, but no, my good buds, no. It is our own beloved superpower, or hyperpower, or mononucleus macronuclear power, the US of A, which seems destined for a bad period. Although we aren�t totally convinced by this kind of talk � after all, during the last bad period, 1991, there was talk of the collapse of US banking. The better bet is that we will eke out this time. But odds wouldn�t be odds if there wasn�t a chance of the losing end:

"The unwinding of America's economic and financial imbalances has barely begun. Share prices are still overvalued by many measures. Companies still need to prune much more excess capacity. Most worryingly, debts still loom dangerously large. Although much of the increase in reported profits in the late 1990s was illusory, the increase in corporate debt to finance that unprofitable investment was horribly real. Dresdner Kleinwort Wasserstein, an investment bank, estimates that American corporate balance sheets are more stretched than at any time during the past half-century.


"American households' net worth is likely to shrink again this year, for the third year running, after a long, uninterrupted rise since the second world war. If lower share prices cause households to increase their saving sharply, America could be pushed back into recession. Even if saving rises more gradually, the economy is headed for several years of below-trend growth. A weaker dollar would help to cushion the economy, but only by squeezing growth in other countries. The rest of the world, which benefited so handsomely from America's speculative binge, will now have to share its hangover."


Isn't that a lovely word, "unwinding"? It has the crisp techno-beauty of one of those words so cleverly collected by Don Delillo � an artificial flower of rhetoric. All those snappy terms that derive distantly from the impression managers, the think tank, the game theorists. Unwinding should remind us of yarn, and homemakers, and cats; oddly enough, it evokes none of those things. My guess is that unwinding comes from a more clockwork world, one in which the key can go in the slot and uncoil the mechanism. We don�t know when "unwinding a position" became a wall street phrase of art, although we�ve looked around. Where are the lexicographers of tomorrow? Here�s a puzzle for you.

Swift uses a prototype of the phrase in "The tale of a tub;"




"However, that neither the world nor our selves, may any longer suffer by such misunderstandings, I have been prevailed on, after much importunity from my friends, to travel in a complete and laborious dissertation upon the prime productions of our society, which, beside their beautiful externals, for the gratification of superficial readers, have darkly and deeply couched under them the most finished and refined systems of all sciences and arts; as I do not doubt to lay open by untwisting or unwinding, and either to draw up by exantlation, or display by incision."


LI knows that Wall Street does have its litterateurs. However, we doubt that the term came from Swift, however nicely this would fit our sense of the, uh, impostures of high finance

Remora

Kurds and ways

Christopher Hitchens has, since 9/11, rather fancied himself the Don Quixote of the Left, jousting with the anti-war contingent, rallying the troops around feminism, secularism, and democracy. Well, beyond the posturing natural to Hitchens, there is something to his perception of the anti-war left -- you don't have to look far before you find rather stupid analogies between, say, Saddam Hussein's use of nerve gas and lynchings in the U.S. South. The stupidity resides in the fact that there were mechanisms in the state to operate against the lynching spree -- and eventually, creakily, did. Genocide past neither justifies genocide present nor, necessarily, bars a nation from acting militarily. One can take a stand against any nation acting militarily at all, or one can take a stand against particular military actions, but the dumbest of all stands, LI thinks, is that which requires complete purity of nationhood (perhaps for a thousand years) before a nation is allowed to engage another. Until then, one supposes, the military force has to be content with sharpening knives and shining its buttons. Hitchens, criticizing such politics, is in good company. Marx saw how necessary the Napoleonic wars were in carrying the ideals of the French revolution across Europe, and lamented that Germany was never really conquered by the French. However, the modified lefty point seems to me quite plausible: if the actions of a nation have been morally stained in the recent past (say, the moral stain of selling the ingredients for chemical weapons, or condoning their use - that's pretty staining) in regard to a particular other nation, then it is quite right to doubt whether the former nation is morally qualified to proclaim itself justified in intervening in the affairs of the latter nation. Or, to speak with less cotton in my mouth, Iraqis have pretty good reasons to think that they are going to be manipulated, killed, and otherwise displaced for no good end, except, perhaps, the enrichment of some oil companies and the pleasure their deaths will bring to Ariel (or is it Caliban?) Sharon.

LI has been on the side of using military force against Al Qaeda. But count LI in the peace camp as far as Iraq goes. Hitchens has two columns in the nation in which he goes into the Kurdish side of the upcoming war. We want to comment at length about one of those columns -- Appointment in Samarra -- so we aren't going to quote it, as is usually our custom. To make sense of the three points that follow, probably you should go to the Hitchens column first. And now, without further ado:

Questions for Hitchens!

1. The 'devolved" Kurdish state. Devolution might work with Scotland, a region that has existed for three hundred years within the greater framework of British law and statehood, but it is hard to understand what it would mean for the Kurds.

If, indeed, we accept that the Kurds, like the Palestinians, deserve some kind of state, we have to be careful not to surrender to romantic illusions either about the means that might make this possible or the state that might result. Hitchens ignores the real political maneuvering in Northern Iraq during the last ten years. If he were more honest, he would at least allude to such evidences of Kurdish war-lordism as Masoud Barzani
's KDP Alliance with Saddam Hussein in 1996, which was aimed at destroying his Kurdish opponent, the PUK. We also know that Kurdish militias, far from buttressing the liberal dream of a secular, democratic state, have shown, in the past ten years, a mix of tendencies. One pattern is to revert to ideologies of Islamic extremism, or to act in ways that are pure banditry. Against this one can set the current governance of Northern Iraq, which by all accounts is generally one of tolerance. Hitchens can wish away recent history by selectively attending to liberal Kurdish groups, but such a move is fatal to the intelligent analysis of the Kurdish situation. Does Hitchens really think that those Islamicist factions in Northern Iraq are somehow going to vanish if Hussein is attacked? Remember, these factions are basically aligned with the kind of state the Taliban inaugurated - the kind of state Hitchens has attacked as fascist.
2. This brings up our second question. As liberal Americans, we of course would like to see a strong secular state in Northern Iraq, one that would possess structures for the peaceful transfer of power among different factions; one that would respect the human rights of minorities; and one that would contrive barriers to the wholesale looting of national wealth, which is as endemic to warlord prone areas of the world as it is to CEO-centric corporations. Now, by an accident, a safe haven has been carved out in Northern Iraq where these institutions, although often battered, seem to be growing. Would a war that deposed Saddam Hussein really be to the advantage of the growth of this type of state? I would suggest that the best course is to continue to keep the pressure on Hussein, to disarm him, to inspect him, to encourage popular revolt against him - but not to crush him through military force. Hitchens might say that retaining Saddam Hussein means, every day, imprisoning the people of Iraq. But all means of liberation aren't equal. Given the weakness of Hussein's forces, Northern Iraq is in no immediate danger of falling once again to the Republican Guard. It acts as a strong attractor, a model, for Iraqi discontent. Outside intelligence has been noticeably poor at predicting the downfall of dictators. I'd think the internal collapse of Hussein's regime is a much better goal to aim for. Frankly, there is no reason to think that the Americans won't prop up a military man to rule as a satrap in conquered Iraq. They've not only done this before: in Pakistan, they are colluding at it right now.

3. Finally, I find the implied dismissal of Turkish interest both unfair and historically misplaced. The safe haven in North Iraq exists by courtesy of the use of Turkish air strips, and was suggested by the Turkish government itself, in 1993, in response to the wave of Kurdish refugees. While it is true that the Turkish government's war against the PKK, the Kurdish guerilla group, was waged with maximum brutality, it is also true that the PKK responded in kind. It is also true that the PKK's ideology, a mixture of Mao and Mohammed, was a charlatan politics; that it evolved into a typical mix of twentieth century crime and brute political force, accruing money through trading drugs and arms, and wiping out any sign of Kurdish opposition; and that it never received the support of even a substantial minority of Turkish Kurds. It is a mistake to think that the situation in Turkey is anything like the situation in Iraq. There are billionaire Turkish Kurds; there are Kurdish presses in Istanbul; there is a high mix of Kurds in the Turkish military. The question of discrimination, which is a valid issue in Turkey, shouldn't be confused with the issue of separation. Like the Mayan farmers in Chiapas, Kurds might be oppressed by discriminations in the power structure in existence right now, but their grievances are peacefully resolvable, with no injury to the state of Turkey as a whole.

Naturally, Turkey can't countenance a hostile Kurdish state in Northern Iraq. Whether Kurdish factions can resist the dubious romantic satisfaction of encouraging violence in Turkey should definitely be a condition for further steps towards Kurdish autonomy (of whatever kind) in Northern Iraq. Far better to preserve the present, fragile situation, in which non-violent organizations can form, than to hope that peace arise out of the chaos of war.