August 12, 1771

... But before I can go further, I need to go back to the very important conversation between Werther and Albert on August 12 – a day that changes the entire tone of the novel.

On August 12, Werther records an important conversation with Albert. Albert is Charlotte’s betrothed. In fact, Werther has been making Albert his doppelganger. They both love Charlotte, and – while Werther has said nothing about this to Albert – one can guess that Albert has guessed. I won’t dwell on how much this situation reminds me of certain adulterous passages from my own past – because that would be tedious and embarrassing. Suffice it to say that I found Werther’s behavior here almost unbearably familiar.

So, on August 12th, Albert and Werther have a conversation. The starting point is Albert’s pocket pistols, which Werther wants to borrow. This leads to a discussion of the etiquette of pistols – once, Albert’s servant was cleaning the pistols and showing off to tease another servant, a likely girl, and accidentally shot her. Since then, Albert has made sure that the pistols aren’t loaded.

Werther’s immediate commentary on this story is not only gorgeous, but gives us in a very brief space the aesthetic credo of modernism.

“ My dear, what after all is foresight? Nothing can ever really teach us about danger. Really – “ Now you know [you being Werther’s silent friend, to whom he is writing this letter] that I have the warmest feelings for the man, up to his ‘really’. Because isn’t it self-evident, that every general rule suffers some exceptions? But the man will insist so much on being in the right! That when he believes to have said something hurried, general, half true - - so he begins to limit, to modify, to hem and haw endlessly, until there is nothing left of the thing at all. And on this occasion he plunged deeper into the text – I finally stopped listening to him, fell to moping, and with an irritable gesture I pressed the mouth of the pistol over my right eye, on the forehead. What are you doing!? as he grabbed the pistol away from me. It isn’t loaded, I said. Even so, he said impatiently. I can’t imagine how a man could be so foolish as to shoot himself. The simple thought goes against my grain.

You people, I cried out, in order to speak about a thing, have to say the same thing: that is foolish, that is clever, that is good, that it is bad! And what does all that amount to? Have you thereby plumbed the inner relationships of an action? Do you know with certainty how the causes develop, why they happen, why they have to happen? If you only had, then you wouldn’t be so quick with your judgments.

You will have to concede, said Albert, that certain actions remain vicious, whatever the grounds from which they spring.

I shrugged my shoulders and conceded it…”

Stop here for a second. It is August 12, 1771. And in this passage, a revolution has happened. You can look around the 18th century where you will, but nothing like this conversation, this attitude, that shrug, that outcry – not even in Rousseau. Nobody had written this kind of thing before. That is, since Shakespeare and Montaigne. Sure, you will find bawdy in the 18th century, you will find glimpses of Rabelais, and there was always Cyrano, and there was the conversations in Gullivers Travels in the fourth book – but all of that remained under the stamp of classical forms. This, this is new, this is Satanic – to use the word as Michelet used it, talking about how the saying of the Lord’s prayer backwards was a decisive blow against the totality and the total oppression of the Church. August 12, 1771. That bold idea – to profane the sacred not by denial, but by reversal, by inversion – that forms a domain of revolt that emerges in this conversation as clearly as the fact that Albert’s gun isn’t loaded – that is, it is fraught with obsession. It all comes together here – the pistol, Werther’s moment of bitter absent mindedness, the irritable gesture, Albert’s irrefutable reasonableness – out of this comes Kleist’s end, and the fever dreams of Stepan Verkhovensky and the girl that Stavrogin might have raped, and who certainly hung herself, Munch painted this, Godard filmed this, the Sex Pistols sung this – and a million exegetes have tried to sweep it into one ideology or another, God help us. It is central to, and hidden by, the turn in happiness culture – that moment in which, after the liberation from the old feudal structure of the passions, from the old superstitions, from the old fears of pleasure, from the old primitive cosmos of pain and pleasure doled out by a mastertroping deity, the imagination turns to look at its creation and is struck … with the horror of it all. For it all ends up in Albert’s voice, in his reasonableness, in his being just the kind of man who will make Charlotte the best of husbands.

And I too will take the energy of this, and I will flatten it out, I will seek the larger view, the gross generalization, I will put this in some machine or other. See if I don’t.

To be continued next post…

substitutes and suicide

Durkheim’s book on suicide has generated a long history of controversy regarding its statistics, Durkheim’s attack on Tarde’s imitation model of suicide, his interpretation of the data according to sex, etc. Using Bertillion’s statistics, Durkheim was able to overthrow some myths – that, for instance, the English were prone to the English malady – it turned out that they had less of a rate of suicide than the Germans – or that married men were more prone to suicide than bachelors. The latter was a very deft statistical routine, since the misconception – statistically – rested on including, in the set of bachelors, boys below the marriageable age. When adjusted for men over eighteen, it turned out that married men were significantly less likely to kill themselves than bachelors, although the ratio was closer for married men in their twenties. As for women, well, women are less likely to kill themselves period – a fact born out since Durkheim. What Durkheim did not have the statistics on then is suicide attempts – and that, it turns out, is startling, since women are much more likely to attempt suicide.

Durkheim’s famous quadrangle of suicide categories, which he discerned beneath the statistics, classified suicides by two binaries: egoist vs. altruist, and anomie vs. fatalism. These divisions in turn rested on Durkheim’s perception of one large social fact – the degree of social integration.

There are a number of attacks on Durkheim’s thesis as vague, or Durkheim’s numbers as wrong. Jack Douglas, an early symbolic interactionist, for instance, disputed the numbers since, in Douglas’ view, suicide is undercounted, and disputed the anomie thesis, since in his view Durkheim was not giving enough weight to the social situation of the suicide case. He was mashing them all together. Other’s have attempted to revive Tarde’s notion of the imitation suicide – and indeed, there are indications that this happens. However, nobody really thinks that imitation is at the center of suicide, at least as Tarde conceived it.

The statistics on suicide and suicide attempts points to a rather fascinating social phenomenon, presaged in folk beliefs about suicide. According to Irina Pappano’s Suicide as a Cultural Institution in Dostoevsky’s Russia, there was a Slavic folk belief in the wandering dead, the zalozhnye pokoiniki,, who “are not fully dead: disembodied, they continue to serve the terms of their earthly existence. Anthropologists connect such beliefs, which are common to many cultures, to the mythological view of death as a transition between two worlds. Suicides are forever suspended in the liminal realm, belonging neither to the world of the dead nor to the world of the living.” (54) This belief may be more modern, more contemporary, than we are willing to admit. The “to be or not to be’ is defied by the attempted suicide. That it seems to be a category of its own, apart from suicide, is indicated by the fact that some 85 percent of attempters don’t, in fact, succeed in killing themselves – they die of other ‘natural’ causes. Thus, “not to be” is made a more ambiguous thing, a suspended thing, a metaphor. Death is drawn into the order of life to play many roles: intensifier, cleanser, transcender, etc. I am not certain what to make of this, given Durkheim’s categories.

I want to apply some of Durkheim’s theory of suicide to The Sorrows of the Young Werther – in particular, to the part played by the circles I have drawn your attention to in the last post. That is, the way Werther’s falling in love seems to be mediated by three circles, having two elements: the distribution of something – bread, dancers, numbers/slaps – and the substitution relation. Now, I have long been nosing around the idea of substitution without fully explaining it, and some may have smelt the Marxist mouse in the house. My concern with substitution and love is a timid attempt to forge a link with one of the great social inventions of the proto-capitalist era, abstract labor – to wit, the notion that laborers in the industrial system are infinitely substitutable. The blacksmith becomes a car mechanic who becomes a worker on a computer assembly line, all under the benign gaze of the economist who sees in this the triumph of the freed up labor system. It doesn’t matter what you do, it matters that you make money. Dissolving the traditional slavery of the apprentice, the artificial barriers erected by the guild, we free up the laborer to be, in essence, an adventurer in the realm of substitution. The jack of all trades, the Casanova of skills, or, less prettily, the reserve army of the unemployed – it all results from and confirms a certain view of the tie between subject and his or her routines.

It isn’t that I want to push for a perfect similarity of substitution as it functions in the economic and erotic domain. However, that substitution in both is both a liberation and a threat seems indisputable. More disputeable, but a thesis I’m going to support anyway, is that the precarious balance between liberation and threat was felt throughout the social body in the 18th century, constituting the vibe of the dying order. And thus it is that I am interested in the substitutions in The sorrows of young Werther and Cosi fan Tutti.

But before I can go further, I need to go back to the very important conversation between Werther and Albert on August 12 – a day that changes the entire tone of the novel.

Zona Komiks!

“People are grieving,” said Ms. Goldsmith, a semiretired psychotherapist who counsels fellow residents of the Gleneagles Country Club, a gated community here. “There was a death. Their money died.”

The zona is proving to be quite the beast. Even LI, in whose head wheels of fire turn, and who could stick out his hand anytime to Jonah, Isaiah or Jeremiah and say, cousin, is surprised by the claws on this thing. Our own, perhaps naïve thought was that all the money in the world wasn’t going to help – that in fact, sooner or later, about 65 trillion dollars in derivatives would be nullified. A haircut! Think of the surprise lines drawn around a cartoon character whose been stunned by some sudden news – think of those surprise lines as a trillion each. Nothing, right? But lo and behold, looks like this magic money got comingled with real money. Magic money is, of course, the chief concern of all right thinking people, which is why AIG gets a nice little 30 billion dollar snack yesterday, and today the Bushies are for vetoing any aid to GM. GM evokes a lot of anger from the GOP crowd, because they realize that GM hired thousands and thousands of Union workers – the horror! Not like those wondrous AIG people, people you can recognize, people you might want to have a drink with, or go pussy-hunting with after a long hot day fleecing the rubes – in contrast with those greedhead workers, always trying to get health insurance and pensions. Imagine! It makes a person sick, it really does. Howwegonnastaycompetitive, as the economists always say. After they explain that trade deficits are nuthintoworryabout. That might seem contradictory, until you realize that the world in which innovative financial instruments lead to utopia is in a different column than laborflexibilitycreativedestructioncompetitiveadvantage and other words of that ilk, assuring us that maximizing inequality, stabilizing incomes and invest invest invest is the best thing in the whole world, though it does sometimes lead to crackup, the end of the atmosphere, endless war, and the stupidest sitting with riding crops poised on top of your neck and you watch your life turn into a senseless and pointless debttrap.

But, though it might break the bank and your heart, still, the zona has its charming side. It is funny! Surely this is the funniest depression ever. LI is serious – the best thing I’ve read about the ‘bubble’ so far is this fantastic article by Michael Lewis, of Liar Poker fame, in Portfolio. I read it last night, and I couldn’t stop laughing.

Recently, I read a buncha comments in various blogs mourning the passing of Michael Crichton. Those remarks puzzled me, because all of them would announce that Crichton was a lousy writer who seems to have been addictive. But why? And the plots that he apparently worked out seem, well, to have been either done before and better – Jurassic park, meet the lost world – or not worth doing. Contrast this with fi fiction – or faction, which is what Michael Lewis does. For one thing, he can write – he is definitely not clunky. He has the prose style of the Moviegoer - unsurprisingly, coming from Walker Percy's town. And for another thing, the characters he writes about, who inhabit Wall Street, are monsters ten times scarier than a band of people with star influenza, or who, I don’t know, conspire to trick the world into thinking global warming is a fact. But they are also, as supreme egotists with no culture, extremely funny. The things Lewis' characters do to ruin companies, the lives of individuals, and anybody who gets in their orbit merely to make the next million bucks have just that horror movie note of the unstoppable evil force. At the same time, it is wildly funny. The way they package instruments they don’t understand and sell them to each other is funny. The way they got America, where it is morning and Reagan is the sun, on the hook, the one that is dragging us under. This is what comedy is about. What’s not to love about these characters? Plus, they are real.

The hero of Lewis’ piece is a hedge funder named Steve Eisman. Eisman, like a Michael Crichton character, is set down in the midst of suspicious and whacky doings - Wall Street, 2003. As in Jurassic Park, there seemed to be something genetically suspicious going on – animals were getting bigger and bigger on resources that were lean enough to support merely a crop of mice. In what, to me, is the key to the whole fascinatin mystery, Eisman and his crew at FrontPoint, his fund, learn this:

At the end of 2004, Eisman, Moses, and Daniel shared a sense that unhealthy things were going on in the U.S. housing market: Lots of firms were lending money to people who shouldn’t have been borrowing it. They thought Alan Greenspan’s decision after the internet bust to lower interest rates to 1 percent was a travesty that would lead to some terrible day of reckoning. Neither of these insights was entirely original. Ivy Zelman, at the time the housing-market analyst at Credit Suisse, had seen the bubble forming very early on. There’s a simple measure of sanity in housing prices: the ratio of median home price to income. Historically, it runs around 3 to 1; by late 2004, it had risen nationally to 4 to 1. “All these people were saying it was nearly as high in some other countries,” Zelman says. “But the problem wasn’t just that it was 4 to 1. In Los Angeles, it was 10 to 1, and in Miami, 8.5 to 1. And then you coupled that with the buyers. They weren’t real buyers. They were speculators.” Zelman alienated clients with her pessimism, but she couldn’t pretend everything was good. “It wasn’t that hard in hindsight to see it,” she says. “It was very hard to know when it would stop.” Zelman spoke occasionally with Eisman and always left these conversations feeling better about her views and worse about the world. “You needed the occasional assurance that you weren’t nuts,” she says. She wasn’t nuts. The world was.

By the spring of 2005, FrontPoint was fairly convinced that something was very screwed up not merely in a handful of companies but in the financial underpinnings of the entire U.S. mortgage market. In 2000, there had been $130 billion in subprime mortgage lending, with $55 billion of that repackaged as mortgage bonds. But in 2005, there was $625 billion in subprime mortgage loans, $507 billion of which found its way into mortgage bonds. Eisman couldn’t understand who was making all these loans or why. He had a from-the-ground-up understanding of both the U.S. housing market and Wall Street. But he’d spent his life in the stock market, and it was clear that the stock market was, in this story, largely irrelevant. “What most people don’t realize is that the fixed-income world dwarfs the equity world,” he says. “The equity world is like a fucking zit compared with the bond market.” He shorted companies that originated subprime loans, like New Century and Indy Mac, and companies that built the houses bought with the loans, such as Toll Brothers. Smart as these trades proved to be, they weren’t entirely satisfying. These companies paid high dividends, and their shares were often expensive to borrow; selling them short was a costly proposition.”

What is the meaning of the shift from 3 to 1 to 4 to 1? Well, we will hear, we are hearing, our ears are deaf with hearing, that we brought this on ourselves, us selfish pigs, overspending, never saving, bad bad bad people. Of course, this is a pile of shit. What this means is that housing prices were going up while the benefits of increased productivity went solely to the investor class. In actuality, people, selfish greedy pigpeople, were operating under the rational assumption that they were going to make more money as time went along. That is because they had four decades of experience in which, as time went along, they made more money: the sixties, seventies, eighties and nineties. What was different under the Great Fly’s years? They hit a wall. The wealth was spread among the wealthiest, while the little people – greedy fucks! – finally got shut out. After all, as suave economists like those who write for Freakonomics point out, the poor are really the lucky duckies – look at how prices for plastic tat from China have plunged! Why, Walmart is proof positive that the hillbillies are engrossing the benefits of free trade, free markets, and our wonderful health care system! While the rich (sob!) have to be content with taking the profits from the system for themselves. This makes the Freakonomic guys emotional, it really does.

Anyway, to get back to our pump and dump saga, Lewis shows Eisman and associates going to various new housing developments, talking to dealers in CDOs, and getting a feel for the New World. It is pod people time.

For instance, he knew that the big Wall Street investment banks took huge piles of loans that in and of themselves might be rated BBB, threw them into a trust, carved the trust into tranches, and wound up with 60 percent of the new total being rated AAA.

But he couldn’t figure out exactly how the rating agencies justified turning BBB loans into AAA-rated bonds. “I didn’t understand how they were turning all this garbage into gold,” he says. He brought some of the bond people from Goldman Sachs, Lehman Brothers, and UBS over for a visit. “We always asked the same question,” says Eisman. “Where are the rating agencies in all of this? And I’d always get the same reaction. It was a smirk.” He called Standard & Poor’s and asked what would happen to default rates if real estate prices fell. The man at S&P couldn’t say; its model for home prices had no ability to accept a negative number. “They were just assuming home prices would keep going up,” Eisman says.

As an investor, Eisman was allowed on the quarterly conference calls held by Moody’s but not allowed to ask questions. The people at Moody’s were polite about their brush-off, however. The C.E.O. even invited Eisman and his team to his office for a visit in June 2007. By then, Eisman was so certain that the world had been turned upside down that he just assumed this guy must know it too. “But we’re sitting there,” Daniel recalls, “and he says to us, like he actually means it, ‘I truly believe that our rating will prove accurate.’ And Steve shoots up in his chair and asks, ‘What did you just say?’ as if the guy had just uttered the most preposterous statement in the history of finance. He repeated it. And Eisman just laughed at him.”

“With all due respect, sir,” Daniel told the C.E.O. deferentially as they left the meeting, “you’re delusional.”

I’d continue this story, but I’d rather just whet your appetite for it. Go and read the terrific Portfolio piece. Have a laugh! Then figure out how you are going to eat for the next coupla years.

On 2666

Here’s a small factoid. “Hyle”, the Greek for matter, is also the Greek for wood. It should be translated into Latin as materia. However, Calcidius, whose translation of Plato into Latin was what the medievals read when they read Plato, translated hyle as “sylva” – woods, or forest. So that if, say, Thomas Acquinas wanted to read the Timaeus, every time Plato uses the word matter, Acquinas would have read the word “forest”. Imagine the metaphysics of that.

Translation matters. It also forests – as every translator knows, the words in the text in one language branch out and root differently in another language. I’m pleased that the New York Times, with its dogged, lagging sense of fashion, recognized that Bolano is cult and cool, and hired Jonathan Lethem to review Natasha Wimmer’s translation of 2666. However, the review, while glowing, glowed around no central fire – for it wasn’t the burning novel to which the reader’s attention was drawn so much as the unceasing flurry of names in Contemporary World Literature. And, frankly, I felt the acknowledgment of Wimmer “(by Natasha Wimmer, the indefatigable translator of “The Savage Detectives”)” was unworthy.

Slate’s Adam Kirsch produced a more thoughtful review, and the gracenote about the translation is not such a toss-off: “That is one reason why the book is so hard to summarize—and why Natasha Wimmer's lucid, versatile translation is so triumphant.” The versatile is reviewer speak – as the reviewer of at least 1500 books, I have the intonations grooved into my brain. If you begin with one adjective, like lucid, you have to throw in another one – and if you are feeling particularly puff-y, you throw in a third. Still, I don't want to dismiss the versatile, here, entirely. It means something. Wimmer had to come to grips with very difficult matters, here. A lesser translator could easily have gotten lost in the woods.

In fact, the two Bolano novels are a translator’s triumph. Wimmer (I say this through gritted teeth, and with envy aforethought - why couldn't it have been me, God?) is the only person I know, personally, who I am confident will be read in one hundred years. I have read a number of her translations – for instance, her translation of Vargas Llosa’s Gauguin novel, of which I can only say, read Somerset Maugham’s Gauguin novel. I’ve read her translation of Rodrigo Fresan’s Kensington Gardens. Both were more than competent (and really, we Americans are living in the age not only of a scandalous lack of translations, but translation scandals as well – Orhan Pamuk’s novels seem to have been translated by the first person the publisher met who could speak Turkish and a sort of English, for instance), but the Bolano novels are brilliant. She has shapeshifted those novels into English. I think the best comparison for this feat is Ralph Mannheim’s translations of Celine.

I think Lethem goes astray with his references, but he is certainly on the right track about Bolano as a very writerly writer. By this, I don’t mean an avant garde writer, or a writer whose technical inventions should be studied by other writers – I mean a man who has a burning belief in literature in the world. Bolano had an overwhelming and overwhelmed sense of how literature has failed the world, which can only be held by someone whose belief in literature is bonedeep. This cosmic failure is his starting point: he is the anti-Paul, for whom lack of the letter killeth. Hell is the degree zero of literature – its disappearance from the world. Hell, in fact is depicted in the fourth book of 2666. It is a factory for raping, torturing, killing and dumping women. It is the city of Santa Theresa.

2666 does not remind me of any contemporary writer’s work – rather, it reminds me of the Chroniclers of the wars of religion. Or of their closest modern spiritual kin, the writer Johann Hebel (1760-1826), whose stories, put out as Kalendargeschichte in almanacs and collected in the “Little Treasure Chest of the Rhenish Family Friend”, were admired by Kafka, Walter Benjamin and Ernst Bloch, among others. Benjamin and Bloch singled out the “Unexpected (Unverhoffte – Unhoped for) Meeting” as one of the greatest of short stories. It is a story about a woman whose husband to be, a miner in Falun, Sweden, dies in an accident before they get married. And it contains this famous passage, which I’ll translate:

“He never came back out of the mine, and she vainly hemmed a red border on his black neck-cloth for him that very morning for the wedding, be as he never came, she laid it away, and cried for him and never forgot him. In the mean time the city of Lisbon in Portugal was destroyed through an earthquake, and the seven years war went by, and King Franz the first died, and the Jesuit order was dissolved and Poland was divided, and the Empress Maria Theresia died, and Count Struensee was executed, America became independent, and the united power of France and Spain could not conquer Gibraltar. The Turks bottled up General Stein at Verteraner Cave in Hungary, and Emperor Joseph also died. King Gustav of Sweden conquered Russian Finland, and the French Revolution and the long war began, and Emperor Leopold the second also went down into his grave. Napoleon conquered Prussia, and the English bombed Kopenhagen, and the peasants sowed and reaped. The miller milled, and the smith hammered, and the miners dug for veins of metal in their underground workshop. But as the miners in Falun in the year 1809 somewhat before or after St. John’s day between two battles attempted to open another tunnel, a good three hundred ells deep under the ground, they uncovered out of the rubble and sulfuric acid the corpse of a youth, who was completely saturated in copperas, but otherwise undecayed and unchanged. Thus, one could see his facial features and his age completely, as if he had just died an hour ago, or was taking a little nap, at work.”

The interweaving of public and private time here partakes of both the Chronicler’s vision – a vision fed by the Bible’s histories, where kings could be brought down by the commonest of sins – coveting a man’s vineyard, or a man’s wife – and prophets could arise seemingly randomly out of the population – and by the ironic modern sense that, on the one hand, political organization should not be like this, should be radically changed, and on the other hand, that no change abolishes the central, sweeping inevitabilities – work, desire, death, mourning.

Bolano, like the Chroniclers, and like Hebel (witness to the Napoleonic wars), lived in an age marked by massacres and internecine struggles animated by what were essentially mysteries – the mystery of socialism, the mystery of the drug wars, the mystery of the universal, media drenched numbness. The 4th book contains accounts of what seems to be about three hundred murders. But the 4th book also contains the entangled stories of an American freelance detective, of a Geman man named Haas, imprisoned for all the murders (and obviously not guilty of most of them, or perhaps all), a television prophet, etc., etc. Here’s a bit from the 4th section. Tell me if this doesn’t remind you of Hebel:

"In the middle of November, Andrea Pacheco Martinez, thirteen, was kidnapped on her way out of Vocational School 16. Although the street was far from deserted, there were no witnesses, except for two of Andrea’s classmates who saw her head toward a black car, probably a Peregrino or a Spirit, where a person in sunglasses was waiting for her. There may have been other people in the car, but Andrea’s classmates didn’t get a look at them, partly because the car windows were tinted. That afternoon Andrea didn’t come home and her parents filed a police report a few hours later, after they had called some of her friends. The city police and the judicial police took charge of the case. When she was found two days later, her body showed unmistakable signs of strangulation, with a fracture of the hyoid bone. She had been anally and vaginally raped. There was tumefaction of the wrists, as if they had been bound. Both ankles presented lacerations, by which it was deduced that her feet had also been tied. A Salvadorean immigrant found the body behind the Fracisco I School, on Madero, near Colonia Alamos. It was fully dressed, and the clothes, except for the shirt, which was missing several buttons, were intact. The Salvadorean was accused of the homicide and spent two weeks in the cells of Polcie Precinct #3, at the end of which he was released. When he got out he was a broken man. A little later he crossed the border with a pollero. In Arizona he got lost in the desert and after walking for three days, he made it to Patagonia, badly dehydrated, where a rancher beat him up for vomiting on his land. He was picked up by the sheriff and spent a day in jail and then he was sent to the hospital, where the only thing left for him was die in peace, which he did."

on not needing a weatherman...

I'll be the man with the broom
if you'll be the dust in the room

Under the “You don’t need a weatherman to know which way the wind blows” department, this story in the NYT about a town where everybody is below average – that is, 90 percent of the owners of houses in the town owe more on their mortgages than their houses are worth – the story of Gerry Martinez leaps out. The town is one of those jumped up suburbs of the Bay area, built because the Bay area is way too expensive. The Martinezes don’t proclaim their income in the article – but one guesses it is South of 100 thou a year. Here’s the infarction graf:

“The Martinezes bought their house in early 2005 for $630,000. It is now worth about $420,000. They have an interest-only mortgage, a popular loan during the boom that allows owners to forgo principal payments for a time.
But these loans eventually become unmanageable. In 2015, Mr. Martinez said, his monthly payments will be $12,000 a month. He laughed and shook his head at the absurdity of it.”

12,000 per month Not in lira. Not in yen. Not in penguin dung. They are called dollars. That was the hook he and his wife evidently thought they would be spared – the fish would sell the hook to the other fish. And thus, everybody would get to dine on big, sloppy fat worms. It would be the ownership society. Paradise, man!
It would be interesting to see how many people in this country are hooked into the same kind of deal, and don’t know it.

That economists were still generally talking, this spring, about a turnaround in the fourth quarter should tell you all you need to know about the priesthood. Like all priesthoods, its goal is to weave stories around the wealthy to make them appear mythically heroic. Besides that, they have no function. Their predictions are shit. Mr. Martinez is a much better indicator of what our near future is gonna be like, economy-wise. It is going to be ugly.

fantasy politics and the new deal

LI has enjoyed the round-the-blogs discussion about the New Deal, which started with Eric Rauchway’s takedown of Amity Schlaes country club revisionism regarding Roosevelt (here and here and here ) and the Marginal Revolution’s Alex Tabbarok’s attack on Rauchway (here)

LI’s notion is that Rauchway is, obviously, right about the success of the New Deal – if one judges success as ‘did this get entrenched into the economy’ – in the same way that neo-liberalism succeeded after Reagan. In the thirties, the depression in the U.S. was prolonged not because Roosevelt was too radical, but because he was too timid. Oddly, although the Great Depression was an international slump, nobody has expanded the frame of the argument to compare the U.S. performance to other economies – which would tell us, trivially, that the 1937-1938 period was a slump elsewhere as well, but would also give us a larger picture about the Great Transformation of the Great Transformation. Among the developed countries, the U.S., during the twenties, was rather unique in producing a recognizable social welfare net – even the Conservatives in the U.K., however viciously they squelched the General Strike, did not even try to go back to classical liberalism. And this turned out to be their ace in the hole. In fact, in parts of England, there was actually a consumer boom in the thirties. Why? Well, partly because of the Conservative Party’s break with free trade doctrine. Instead, Chamberlain’s government came in on a promise to raise tariffs – which, in the U.S., we’ve all been taught is the devil’s instrument. This contributed to the relative healthiness of the British economy – although the tariff policy has to be viewed in the context of Britain’s special place at the center of a worldwide empire, the Imperial Preference policy, which was knocked down at the end of WWII by the Americans at Bretton Woods, who treated Britain as a defeated country. The import restrictions, as a matter of fact, acted as a stimulus to domestic industry, which had lagged in the twenties, and – in the end – Britain actually imported more goods, even with the tariffs in place. This doesn’t mean Britain escaped the Slump unscathed - the North of England, Scotland and Wales suffered enormously – but that the libertarian fantasy of responding a la Mellon by liquidating everything – letting markets clear – was adopted by nobody, on the sound principle that it was insane.

And, of course, it is now an historic relic, which is why the argument against the country clubbers has a musty smell. The Republican party has long relied on combining one of the responses to the Depression – military keynesianism, perfected by Imperial Japan and Nazi Germany and with us ever since – with the entrenched social welfare net for the middle class (the attitude towards which is best exemplified in the Bush Pill Bill – basically, adding more to the pile) – while retaining a Hooverite rhetoric about small government. From one view, this is a chaotic amalgam of differing ideological positions – from another view, that of class analysis, this is a perfectly coherent program to reward the wealthiest, which has always involved using the Government – the largest holder of money, after all – for largescale peculation, while talking against it in order to lower upper tax rates. Pragmatically, this has positioned borrowing at the center of conservative politics, and slowly that has exerted such a gravitational pull on conservative policy that it has shaped a freerider ethos.

Long ago – in November, 2001 – LI wrote an article for the Statesman about big government conservatism, in which we predicted that Bush would bury the Clinton mantra that the era of big government was over. I should dig that thing up one of these days. There’s nothing sweeter or more elementary schoolish than a good I told ya so.

News we will immediately forget

My friend, M., was so busy watching the results on November 4th that she didn’t notice her whole building shaking. Then her niece called up, crying. The lights were out in the condo she lives in, close to Los Pinos. Was the building on fire?

It turned out that the fire was burning down the street. M. reports that the parade of firetrucks speeding through Polanco was astonishing. But all the President’s horses and all the president’s men couldn’t put the interior secretary back again. In the U.S., few noticed what had happened, and all took the Government’s line: Calderon’s right hand man in the drug war and his best friend, Juan Camilo Mouriño, along with the chief manager of the war on organized crime, José Luis Santiago Vasconcelos, had been killed in a tragic accident. The pilot lost control of the plane, that is the official story. And who believes it in Mexico, where the police chiefs of major cities, like Acapulco, have been beheaded by the narcos men, and where Calderon, prodded by the Americans, has staked the legitimacy of the government on a military confrontation with Mexico’s most successful private businessmen, who just happen to deal in the transit of cocaine and narcotics to the world’s hungriest market for such goodies, the United States. Success, of course, is relative: on the one hand, the ostrich boots and the hacienda and the week long parties, on the other hand, the feuds, the children shot down, the flights and territorial wars, the whole meat machinery in which he who does not butcher will be butchered, and none shall be the last butcher standing - there is no power on earth to cover your back long enough. M. reports, in a nice touch that Garcia Marquez would appreciate, that Camilo Mourino’s last sight might have been the monument to Pemex, the bastion of legitimate enterprise in Mexico, state owned, that he and Calderon have been working for years to privatize.

Read Alma Guillermoprieto’s essay on the current misrule and massacre in Mexico. Ask yourself what it means that 4,000 people have died in Mexico this year, due to the narco war. Ask yourself what the fuck, what the fuck the U.S. was doing during the Bush years, concentrated on Iraq. Ask yourself if we have a nation so cocooned in trivia that we think Mexico going into the abyss means nothing to us. Ask who made up those narcotic laws. Ask where the market is. Ask yourself if anything can stop the now 40 years of drug madness, the entrenchment on all sides of a money/punishment engine that serves every low, vile, peculiar political and economic interest. Ask yourself how anybody in Sinaloa with brains and a peasant mom and dad is going to get ahead, except through licking those ostrich boots and trying to shatter a few mere human lives himself – lives that are discounted, every day, in the mad, mad media, in the Moloch of the worldfuck, where an hour or two of nod, or enough of a dose to get through the shift at the third job before you get home and shake the newborn when it cries and take another dose, is what you can expect tomorrow and tomorrow and tomorrow.