What to say?
Wellstone is dead.
Saturday, October 26, 2002
Friday, October 25, 2002
Dope
Who among us, droogs and stooges all, remembers the mighty Bishop Butler, the Anglican divine that, of all churchmen, retained the admiration of David Hume, even � who was otherwise impatient of the breed? Yes, well, we admit to having neglected Butler�s Analogy of Religion, Natural and Revealed, for more frivolous works, mainly those by Sir Thomas Browne. What can we say, the sins of our youth, the mark of Cain on our accent, the frittering away, seeds and husks of seeds, of our days and ways, that organic time passing from sleep to sleep, the question of money, that slight but annoying sense that we aren�t alone here, there is always someone by you, the porno that smells like rancid butter, and the things undone world without end that no recording angel will record and yet we swear, to the beating of wings and the feel of the talons closing about us, these were the causes and reasons of our very heart, Lord thou know�est.
We�ve been thinking of Butler because he, like Pascal, was ambitious to annex probability theory to the Christian apologetic. This was a bold undertaking, and you can see how Christian theology, by then, what with the seemingly real threat that an explanation of the world was possible without God � the cogito ergo sum extended, mathematically, over the endless graph of the world, a spectre is haunting Europe and it is the European man, the white mythology � you can see how probability starts turning up, the ace that was neglected, like Jesus himself..For one thing, there�s suddenly the sense that the proposal that there is a life after death is actually a statement about what the world is composed of, the basic blocks, and those blocks aren�t made of matter or spirit but events. The possible, the impossible, and the compossible, that�s the spirit here. A life suddenly means an event among other events, and having to be consonant with other events � in fact, a life it turns out is rooted in a world, and the world is a series of probabilities that radiates out from some dark center of certainty, the convergent point. The terror of the actual. This was, for Leibnitz, the supreme problem, from which the entire Monodology flows.
That�s the one side of it, the intellectual side. The political side, the economic side, the sociological side, whatever you want to call it � we�d guess that the impulse to import into philosophy and theology the methods of the gambler probably says something about the relationship between shifting forms of the social organization of expectation in the seventeenth and eighteenth century. A person's global expectation is an important, but hard to capture, aspect of social stability. It is about what seems walled up and what doesn�t. The directions one goes in, or one doesn�t. One of the effects of the "pure" market -- the financial market -- that are often remarked upon in its being introduced to traditional societies -- that is, those marked by evident and legal distinctions of class, with a strongly developed system of legal and social obstacles to confine and regulate the free flow of goods and services -- is that that social organization is felt to be a threat to the very marks of identity that define the basis of traditional social power -- those bases being inheritence, class position, gender, and some order that maps degrees of separation from a charismatic figure (the sovereign) onto social reputation. The threat that the illegal drug market poses to American society is of this type. However, the dissolution of identity is also a strong temptation to that traditional order, which is maintained by an ethos of boldness, of honor. Honor without the test of honor is simply laziness, complacency, the lukewarm that the lord spits out at the end of days. The aristocrat is always, in the literature of the seventeenth and eighteenth century, a heavy gambler. Perhaps this is because a social order that is slowly being liquidated by changes in the economic reality in which it exists -- as the landed aristocracy was being liquidated by the increasing reach of the commercial system --finds its interest less in a compromise, or integration into that system, which would mean becoming merchants themselves, than into countering the novelty with its extremest expression. That expression is, of course, gambling -- the most developed form of speculation at the time. Although there were irruptions that presaged other forms of speculation -- Law's Mississippi Bubble, which was much more extensive and ingenius than just speculation in shares of land, and the English South Sea Bubble are the two most famous instances.
Enough, though, of this and that. Let's get to what Butler has to say, and tomorrow to what Amos Tversky, the non-Nobel winner, dead and so out of luck, has to say, too, about luck, chance, and its perception.
This is the good Bishop:>
"That which chiefly constitutes Probability is expressed in the word Likely, i. e. like some truth or true event; like it, in itself, in its evidence, in some more or fewer of its circumstances. For when we determine a thing to be probably true, suppose that an event has or will come to pass, it is from the mind's remarking in it a likeness to some other event, which we have observed has come to pass. And this observation forms, in numberless daily instances, a presumption, opinion, or full conviction, that such event has or will come to pass ; according as the observation is, that the like event has sometimes, most commonly, or always, so far as our ob-servation reaches, come to pass at like distances of time, or place, or upon like occasions. Hence arises the be-lief, that a child, if it lives twenty years, will grow up to the stature and strength of a man; that food will contribute to the preservation of its life, and the want of it for such a number of days, be its certain destruction. So likewise the rule and measure of, our hopes and fears concerning the success of our pursuits; our expectations that others will act so and so in such circumstances; and our judgment that such actions proceed from such principles; all these rely upon our having observed the like to what we hope, fear, expect, judge; I say, upon our having observed, the like, either with respect to others or ourselves. And thus, whereas, the prince* who had always lived in a warm climate naturally concluded in the way of analogy, that there was no such thing as water's becoming hard, because he had always observed it to be fluid and yielding: we, on the contrary, from analogy conclude, that there is no presumption at all against this: that it is supposable there may be frost in England any given day in January next; probable that there will on some day of the month; and that there is a moral certainty, i. e. ground for an expectation without any doubt of it in some part or other of the winter. "
Who among us, droogs and stooges all, remembers the mighty Bishop Butler, the Anglican divine that, of all churchmen, retained the admiration of David Hume, even � who was otherwise impatient of the breed? Yes, well, we admit to having neglected Butler�s Analogy of Religion, Natural and Revealed, for more frivolous works, mainly those by Sir Thomas Browne. What can we say, the sins of our youth, the mark of Cain on our accent, the frittering away, seeds and husks of seeds, of our days and ways, that organic time passing from sleep to sleep, the question of money, that slight but annoying sense that we aren�t alone here, there is always someone by you, the porno that smells like rancid butter, and the things undone world without end that no recording angel will record and yet we swear, to the beating of wings and the feel of the talons closing about us, these were the causes and reasons of our very heart, Lord thou know�est.
We�ve been thinking of Butler because he, like Pascal, was ambitious to annex probability theory to the Christian apologetic. This was a bold undertaking, and you can see how Christian theology, by then, what with the seemingly real threat that an explanation of the world was possible without God � the cogito ergo sum extended, mathematically, over the endless graph of the world, a spectre is haunting Europe and it is the European man, the white mythology � you can see how probability starts turning up, the ace that was neglected, like Jesus himself..For one thing, there�s suddenly the sense that the proposal that there is a life after death is actually a statement about what the world is composed of, the basic blocks, and those blocks aren�t made of matter or spirit but events. The possible, the impossible, and the compossible, that�s the spirit here. A life suddenly means an event among other events, and having to be consonant with other events � in fact, a life it turns out is rooted in a world, and the world is a series of probabilities that radiates out from some dark center of certainty, the convergent point. The terror of the actual. This was, for Leibnitz, the supreme problem, from which the entire Monodology flows.
That�s the one side of it, the intellectual side. The political side, the economic side, the sociological side, whatever you want to call it � we�d guess that the impulse to import into philosophy and theology the methods of the gambler probably says something about the relationship between shifting forms of the social organization of expectation in the seventeenth and eighteenth century. A person's global expectation is an important, but hard to capture, aspect of social stability. It is about what seems walled up and what doesn�t. The directions one goes in, or one doesn�t. One of the effects of the "pure" market -- the financial market -- that are often remarked upon in its being introduced to traditional societies -- that is, those marked by evident and legal distinctions of class, with a strongly developed system of legal and social obstacles to confine and regulate the free flow of goods and services -- is that that social organization is felt to be a threat to the very marks of identity that define the basis of traditional social power -- those bases being inheritence, class position, gender, and some order that maps degrees of separation from a charismatic figure (the sovereign) onto social reputation. The threat that the illegal drug market poses to American society is of this type. However, the dissolution of identity is also a strong temptation to that traditional order, which is maintained by an ethos of boldness, of honor. Honor without the test of honor is simply laziness, complacency, the lukewarm that the lord spits out at the end of days. The aristocrat is always, in the literature of the seventeenth and eighteenth century, a heavy gambler. Perhaps this is because a social order that is slowly being liquidated by changes in the economic reality in which it exists -- as the landed aristocracy was being liquidated by the increasing reach of the commercial system --finds its interest less in a compromise, or integration into that system, which would mean becoming merchants themselves, than into countering the novelty with its extremest expression. That expression is, of course, gambling -- the most developed form of speculation at the time. Although there were irruptions that presaged other forms of speculation -- Law's Mississippi Bubble, which was much more extensive and ingenius than just speculation in shares of land, and the English South Sea Bubble are the two most famous instances.
Enough, though, of this and that. Let's get to what Butler has to say, and tomorrow to what Amos Tversky, the non-Nobel winner, dead and so out of luck, has to say, too, about luck, chance, and its perception.
This is the good Bishop:>
"That which chiefly constitutes Probability is expressed in the word Likely, i. e. like some truth or true event; like it, in itself, in its evidence, in some more or fewer of its circumstances. For when we determine a thing to be probably true, suppose that an event has or will come to pass, it is from the mind's remarking in it a likeness to some other event, which we have observed has come to pass. And this observation forms, in numberless daily instances, a presumption, opinion, or full conviction, that such event has or will come to pass ; according as the observation is, that the like event has sometimes, most commonly, or always, so far as our ob-servation reaches, come to pass at like distances of time, or place, or upon like occasions. Hence arises the be-lief, that a child, if it lives twenty years, will grow up to the stature and strength of a man; that food will contribute to the preservation of its life, and the want of it for such a number of days, be its certain destruction. So likewise the rule and measure of, our hopes and fears concerning the success of our pursuits; our expectations that others will act so and so in such circumstances; and our judgment that such actions proceed from such principles; all these rely upon our having observed the like to what we hope, fear, expect, judge; I say, upon our having observed, the like, either with respect to others or ourselves. And thus, whereas, the prince* who had always lived in a warm climate naturally concluded in the way of analogy, that there was no such thing as water's becoming hard, because he had always observed it to be fluid and yielding: we, on the contrary, from analogy conclude, that there is no presumption at all against this: that it is supposable there may be frost in England any given day in January next; probable that there will on some day of the month; and that there is a moral certainty, i. e. ground for an expectation without any doubt of it in some part or other of the winter. "
Wednesday, October 23, 2002
Remora
LI�s editorial philosophy (besides �a sera sera) is to ignore the exaggerated attention given to the standard controversialists of the governing classes. In Hitchens� case, we�ve torn up many rabid commentaries on his various contemporary meanderings, because we just didn�t see the need to add another comment about the guy. But LI's patience is at an end with the guy, and we want to say something.
Hitchens is a instructive case of the way the felinities of the polemicist can give way suddenly to the scurrilities of the flak. His essay in the Sunday Washington Post, So Long Fellow Travellers (actually, it should have been entitled the Long Goodbye, so much copy has Hitchens squeezed out of quitting his column at the Nation), is typical of the new, belligerant Hitchens. The piece distorts the positions of his opponents, the anti-war Left � a venal sin, to which controversialists are prone; and then distorts the position of his own party, which is a much worse sin, even mortal. It is the end of one�s intellectual integrity, which is really all the writer has to offer. The barrage method of insult can't disguise the inglorious intimations of flakhood: the impossible pomposity, the apology for established power, the tone of privileged resentment. .
His criticism of the anti-belligerent case is -- to summarize not unfairly -- that they are cryptic reds, that they �fawn� over Saddam Hussein (disguising this, of course, by pretending to disapprove of gassing Kurds and such), that they mistake George Bush for the aggressor in the current affair, and that, when pretending to make a practical case against the war, they add to their record of mistaken prophecies by contending that war with Iraq would be a quagmire, would entail massive casualties, and a widening war � prophecies that were not realized in Afghanistan and Kosovo. He also makes the astonishing claim that Ramsey Clark is the �main organizer of anti-war propaganda� (all arguments against the war are propaganda, just as all critics of George Bush �smirk,� according to the new Hitchens) � which is about as credible as the claim that Hitchens has changed his political bearings due to a large bribe from the Heritage Foundation.
Briefly, we�d say that the case against the war does not relate to having a soft spot for Brezhnev; that it does claim George Bush is the aggressor in the current affair � this might have something to do with pre-emptive military action, as the very definition of it seems to indicate taking the position of an aggressor, or being aggressive �resisting threats,� which is what every aggressor has claimed to be doing ; that the record of failures in forecasting the course of wars in Kosovo and Afghanistan has little relevance for Iraq; and finally, that the claim that Iraq would be a quagmire, which LI takes to mean would cost one hundred billion dollars and entail leaving an occupying army in Iraq for at least a year -- is buttressed by recent announcements from the administration itself, which forecasts just these things.
Something should be said about the forecasting the course of wars. The great military fact of the nineties was the astonishing success of TAC � the integration of tactical air units into the battlefield. While LI supported the American fight in Afghanistan, we did think that it would be bloodier and longer. The fall of the Taliban, in hindsight, shouldn�t have been so hard to predict � they had conquered only a brief time before, and they were relatively new to real military engagement. However, TAC so far has been successful against small conventional armies, or disorganized armies. It hasn�t been successful against Al Qaeda. Undoubtedly there is a strong chance that the new structure of military engagement will be overwhelmingly, and quickly, successful against Saddam Hussein � but the argument depends more on the previous Gulf war than Kosovo or Afgahnistan, which were much different political and military situations. But even if Hussein�s forces are rolled, the occupation of Iraq looks very, very different than the occupation of Afghanistan. Afghanistan, frankly, is of very little value in the world economy. Iraq is very valuable. It is surrounded by countries with very strong ambitions and plans for that section of the world. It is composed of several ethnic groups that are held together, in the country, by main force. The situation in Iraq looks more like the situation in Lebanon in 1983 than Afghanistan.
Worse than Hitchens dishonesty about the anti-war Left � or just the anti-belligerents, since Left here is pretty much a red herring � is the distortion of his own party of belligerents. He makes no reference both to the recent history of Iraq, which is the background against which we can judge his claims for the Iraqi opposition, nor does he make any references to the administration that is, after all, going to enact his war. That Hitchens wants democracy is a fine thing � we weep for the nobility of his sentiments, and he does too, as often as possible. That he doesn�t mention the political history of Northern Iraq, a safe zone for almost ten years, in which we can see the politics of Kurdish groups played out, is unscrupulous to the highest degree, insofar as he knows what that politics is about. One very strong argument against war with Iraq, from the point of view of the democratic cause in the Middle East, is that it is not in the American interest to allow a high degree of autonomy or democracy to Northern Iraq, especially in the case that it is integrated into an American led state, as it would be after the war. The coming war will collapse a situation that has emerged, after several years of violence, in Northern Iraq. The violence has been between Kurdish war lords, who have not hesitated to ally themselves with Saddam Hussein to establish an advantage with regard to one another. The PKK, the Kurdish guerilla group that terrorized Turkey, and was in turn subject to Turkish terror, is another war lord group that has made certain claims on Northern Iraq. Luckily, the structure of the PKK has collapsed, and the hostilities of the war lords have toned down, recently. There are reports of a free press, elections, even tolerance. These have emerge unexpectedly from a chaotic situation that was never intended to encourage political liberalism. Hooray that such liberalism, however fragile the shoots, has emerged. But don�t look for it to survive a war. What it needs is the preservation of its present circumstances. And that, in turn, will operate as a strong attractor for Iraqi opposition to S.Hussein that is democratic in nature.
The pretense that opposing the war is opposing Hitchens friend in the Iraqi administration is silly. We can understand Venn diagrams. We can understand that two sets that share some members don�t necessarily share all members. LI opposes the war in Iraq that Bush is going to make. We don�t oppose the war Hitch�s friends are going to make, because they haven�t made a war yet, and it doesn�t look like they ever will. Hitchens himself has written in the past that the administration has ignored his Iraqi friends. In the WP essay, however, this caveat vanishes. The implication is that the D.C. belligerents and the Iraqi oppositionists are synonymous. They aren�t. Hitchens rhetoric is the verbal equivalent of the way the CIA gamed the Kurds in the late seventies. It makes a false promise, it uses a group to achieve an end, and then it betrays them. The upcoming war will be about America�s interest, not Hitchens. It is a blow to the ego, but that�s how it will be.
Well, we hadn�t meant to work up a lather about H. Tomorrow we want to move onto a more interesting topic � which is about how distortions inherent in argument might be related to Tversky�s work on the psychology of risk.
LI�s editorial philosophy (besides �a sera sera) is to ignore the exaggerated attention given to the standard controversialists of the governing classes. In Hitchens� case, we�ve torn up many rabid commentaries on his various contemporary meanderings, because we just didn�t see the need to add another comment about the guy. But LI's patience is at an end with the guy, and we want to say something.
Hitchens is a instructive case of the way the felinities of the polemicist can give way suddenly to the scurrilities of the flak. His essay in the Sunday Washington Post, So Long Fellow Travellers (actually, it should have been entitled the Long Goodbye, so much copy has Hitchens squeezed out of quitting his column at the Nation), is typical of the new, belligerant Hitchens. The piece distorts the positions of his opponents, the anti-war Left � a venal sin, to which controversialists are prone; and then distorts the position of his own party, which is a much worse sin, even mortal. It is the end of one�s intellectual integrity, which is really all the writer has to offer. The barrage method of insult can't disguise the inglorious intimations of flakhood: the impossible pomposity, the apology for established power, the tone of privileged resentment. .
His criticism of the anti-belligerent case is -- to summarize not unfairly -- that they are cryptic reds, that they �fawn� over Saddam Hussein (disguising this, of course, by pretending to disapprove of gassing Kurds and such), that they mistake George Bush for the aggressor in the current affair, and that, when pretending to make a practical case against the war, they add to their record of mistaken prophecies by contending that war with Iraq would be a quagmire, would entail massive casualties, and a widening war � prophecies that were not realized in Afghanistan and Kosovo. He also makes the astonishing claim that Ramsey Clark is the �main organizer of anti-war propaganda� (all arguments against the war are propaganda, just as all critics of George Bush �smirk,� according to the new Hitchens) � which is about as credible as the claim that Hitchens has changed his political bearings due to a large bribe from the Heritage Foundation.
Briefly, we�d say that the case against the war does not relate to having a soft spot for Brezhnev; that it does claim George Bush is the aggressor in the current affair � this might have something to do with pre-emptive military action, as the very definition of it seems to indicate taking the position of an aggressor, or being aggressive �resisting threats,� which is what every aggressor has claimed to be doing ; that the record of failures in forecasting the course of wars in Kosovo and Afghanistan has little relevance for Iraq; and finally, that the claim that Iraq would be a quagmire, which LI takes to mean would cost one hundred billion dollars and entail leaving an occupying army in Iraq for at least a year -- is buttressed by recent announcements from the administration itself, which forecasts just these things.
Something should be said about the forecasting the course of wars. The great military fact of the nineties was the astonishing success of TAC � the integration of tactical air units into the battlefield. While LI supported the American fight in Afghanistan, we did think that it would be bloodier and longer. The fall of the Taliban, in hindsight, shouldn�t have been so hard to predict � they had conquered only a brief time before, and they were relatively new to real military engagement. However, TAC so far has been successful against small conventional armies, or disorganized armies. It hasn�t been successful against Al Qaeda. Undoubtedly there is a strong chance that the new structure of military engagement will be overwhelmingly, and quickly, successful against Saddam Hussein � but the argument depends more on the previous Gulf war than Kosovo or Afgahnistan, which were much different political and military situations. But even if Hussein�s forces are rolled, the occupation of Iraq looks very, very different than the occupation of Afghanistan. Afghanistan, frankly, is of very little value in the world economy. Iraq is very valuable. It is surrounded by countries with very strong ambitions and plans for that section of the world. It is composed of several ethnic groups that are held together, in the country, by main force. The situation in Iraq looks more like the situation in Lebanon in 1983 than Afghanistan.
Worse than Hitchens dishonesty about the anti-war Left � or just the anti-belligerents, since Left here is pretty much a red herring � is the distortion of his own party of belligerents. He makes no reference both to the recent history of Iraq, which is the background against which we can judge his claims for the Iraqi opposition, nor does he make any references to the administration that is, after all, going to enact his war. That Hitchens wants democracy is a fine thing � we weep for the nobility of his sentiments, and he does too, as often as possible. That he doesn�t mention the political history of Northern Iraq, a safe zone for almost ten years, in which we can see the politics of Kurdish groups played out, is unscrupulous to the highest degree, insofar as he knows what that politics is about. One very strong argument against war with Iraq, from the point of view of the democratic cause in the Middle East, is that it is not in the American interest to allow a high degree of autonomy or democracy to Northern Iraq, especially in the case that it is integrated into an American led state, as it would be after the war. The coming war will collapse a situation that has emerged, after several years of violence, in Northern Iraq. The violence has been between Kurdish war lords, who have not hesitated to ally themselves with Saddam Hussein to establish an advantage with regard to one another. The PKK, the Kurdish guerilla group that terrorized Turkey, and was in turn subject to Turkish terror, is another war lord group that has made certain claims on Northern Iraq. Luckily, the structure of the PKK has collapsed, and the hostilities of the war lords have toned down, recently. There are reports of a free press, elections, even tolerance. These have emerge unexpectedly from a chaotic situation that was never intended to encourage political liberalism. Hooray that such liberalism, however fragile the shoots, has emerged. But don�t look for it to survive a war. What it needs is the preservation of its present circumstances. And that, in turn, will operate as a strong attractor for Iraqi opposition to S.Hussein that is democratic in nature.
The pretense that opposing the war is opposing Hitchens friend in the Iraqi administration is silly. We can understand Venn diagrams. We can understand that two sets that share some members don�t necessarily share all members. LI opposes the war in Iraq that Bush is going to make. We don�t oppose the war Hitch�s friends are going to make, because they haven�t made a war yet, and it doesn�t look like they ever will. Hitchens himself has written in the past that the administration has ignored his Iraqi friends. In the WP essay, however, this caveat vanishes. The implication is that the D.C. belligerents and the Iraqi oppositionists are synonymous. They aren�t. Hitchens rhetoric is the verbal equivalent of the way the CIA gamed the Kurds in the late seventies. It makes a false promise, it uses a group to achieve an end, and then it betrays them. The upcoming war will be about America�s interest, not Hitchens. It is a blow to the ego, but that�s how it will be.
Well, we hadn�t meant to work up a lather about H. Tomorrow we want to move onto a more interesting topic � which is about how distortions inherent in argument might be related to Tversky�s work on the psychology of risk.
Monday, October 21, 2002
Remora
"Now, this bill also represents the first step in our administration's comprehensive program of financial deregulation. I particularly want to commend the leadership of the chairman, Senator Garn, and Chairman St Germain, along with Secretary Regan and his fine team at Treasury. They did a remarkable job forging a consensus within the Congress and among affected industries in favor of the bill's deregulatory provisions. I'd like to also thank Congressmen Stanton, Wylie, and LaFalce for their assistance.
What this legislation does is expand the powers of thrift institutions by permitting the industry to make commercial loans and increase their consumer lending. It reduces their exposure to changes in the housing market and in interest rate levels. This in turn will make the thrift industry a stronger, more effective force in financing housing for millions of Americans in the years to come."
These words of Ronald Reagan's, spoken at the signing of the Garn-St. Germain act, have echoed down the years, much like the last words of Kim Novak going through Jimmy Stewart's brain in Vertigo. Andrew Sullivan recently observed that Bartlett's Book of Quotations had too few Reagan quotes, proving an underlying left leaning bias. Surely, If LI were to edit a book of quotations, we'd select a few choice R.R. quotes. The lines from the speech above, for instance, would be place, on thematic lines, in the same section that included Willie Sutton's famous dictum that he robbed banks because that's where the money is. Yes, wasn't "reducing their exposure" and "expanding the powers of the thrift institutions" a nice way of saying, we're putting the tommyguns in the hands of the bank presidents? No need for a getaway car when you can't get the company to buy you a nice, corporate Lear jet. Indeed, it was that lot, from Charlie Keating to Herman Beebee, who proved that Sutton was a piker in the way of all freelance robbers. What you really need, when it comes to looting on an imperial scale, is friends in high places and a seat at the board. The best part is the lack of punishment. Not even lack -- the rewards that are heaped upon the larcenous are rich, rich indeed. Because bank robbery by bankers is met not with that ultimate social disapprobium, pinstripes and legchains, but by bail-outs, Reagan's stirring words eventually cost about 32 billion dollars a year to American taxpayers.
For the act that Reagan called the greatest "reform" of the financial industry in 50 years operated, as deregulatory reforms have operated since then, to create systemic problems, both in the S&Ls and then, by an easily tracked contagion, to the composition of corporate ownership as a whole, that eventually brought about a collapse. It was a collapse that, as conservative commentators like to say, was due to the government. Although what they don't say is that it was due to the Government deregulating an industry in a manner that was corrupt at the very root.
We bring up ancient history -- LI was once told we were all woulda, shoulda, coulda cause we keep bringing up ancient history, but you know what? We like it that way -- because we think the shape of the S&L crisis is very similar to the shape of the current crisis of confidence in the market, especially as it has to do with regulatory oversight, or the lack of it. LI wonders if there is a wave pattern here that speaks to a greater structure -- a long-term pattern of corruption that indicates structural invariants extending from the beginning of the Reagan years to now -- extending, that is, through the length of the post-Keynsian era. The contours of it, and the mechanisms that brought it about, have very little to do with the categories that are tossed around in public discourse. Especially unhelpful is the idea that the "government" is somehow opposed to "private enterprise." What happens in capitalism in our time is that alliances of interests, cutting across government and private lines, will marshall resources -- rule changes in regulatory agencies, Senatorial pressures on individual regulators or regulatory bodies, capital from banks, offshore entities, gaps in corporate governance, disguises made available by creative accounting, etc., to create systems of malfeasance that push great amounts of money into the hands of a few. Borrowing a term from Burroughs, let's call this the capitalist Interzone. This machinery is such that it can't last forever. It eventually implodes. The periodic crises in the system are explicitly linked to the high degree of inequity in the system, the corruption of the electoral process, and the inability to replace the money taken out of the system. The moment of implosion, though, will be unevenly distributed throughout the system, burdening those who benefitted least from it by way of taxes, looted pensions, firings, etc. During the S&L crisis, there was a window during which the D.C. co-conspirators of the process were actually held up to the light. Well, a few of them -- the infamous Keating five. This was entirely inadequate, of course. Everyone knew that the legislative orignators of the S&L deregulation process, Fernand St. Germain and Jake Garn, had benefited in the most outrageous ways from S&L largesse. But back then, there actually were symbols that represented a crucial part of the system.
This time around, nothing like that has happened. That is because the system has become much too pervasive to pick out five senators. There was a halfhearted attempt to hold Bush and Cheney symbolically responsible; it was half-hearted because no Senator or Representative -- nobody on the political scene -- can really afford to go after symbols of the system. This is especially noticeable in the case of Phil Gramm. If anybody represented a point man for Enron in the Senate, it was the horrid Gramm. He seems almost devised by some Dickensian god to recieve the slings and arrows of an outraged society, so porcine are his features, and his appetite, so open are his ties to the most corrupt American business to have gone under since Vesco days of yore. His wife's role in the Enron affair is common knowledge. Yet he's slipped out quietly, with no fuss made about his jumping ship to UBS Warburg.
The first phase of the current crisis is over. There are signs that the second phase has kicked in. In this phase, the system reverts back to its corrupt norm. There was much todo made in the conservative press that the reforms enacted this summer went "too far." This noise provides cover for the actual cutting back of those reforms. A story in the NYT this weekend heralds one sign of the reversion to the corrupt norm: the refusal to adequately fund the SEC.
"WASHINGTON, Oct. 18 � Less than three months ago, President Bush signed with great fanfare sweeping corporate antifraud legislation that called for a huge increase in the budget of the Securities and Exchange Commission to police corporate America and clean up Wall Street.
Now the White House is backing off the budget provision and urging Congress to provide the agency with 27 percent less money than the new law authorized.'
Bush and his congressional allies had no intention of stiffening the regulatory mechanisms that oversee corporate governance, accounting, and the markets until they had to, and they have no intention of seeing those new laws work. The last couple weeks, much has been made of the rollover at the new Public Company Accounting Oversight board. Jane Quinn's story, Is Reform a Bad Joke? is mis-named. It is a very good joke.
"At issue is the new Public Company Accounting Oversight Board, created by Congress and signed into law with a flourish by President Bush in July. It�s supposed to set new and higher standards for auditors, who check corporate books. To succeed, it will need a true reformer at its head.
The Securities and Exchange Commission will name the board�s members. As head, SEC chairman Harvey Pitt chose John Biggs�the respected CEO of the giant teacher�s pension fund, TIAA-CREF�say people in a position to know. But the big accounting firms (yes, like the ones that abetted Enron, Tyco, Xerox and WorldCom) scorn goody-goody reformers, and promptly called their political pals. Rep. Michael Oxley (R-Ohio) complained about Biggs and Pitt pulled back. (Oxley�s House committee just happens to oversee the SEC.)"
The SEC funding storry, coming on the heels of the Biggs debacle, isn't exactly a surprise. What does surprise us is the grossness of the maneuver. The Bush regime has consistently lived up to its coup origins: it's grand gestures are coup-like; it's spokesmen of a type made depressingly familiar in Latin America in the seventies, thuggish, happiest when employing junta-like categories in which a manichean world justifies a manichean hunt for subversives. But juntas usually take three to four years to go completely corrupt -- the Bush people are ahead of the game, here. The open conspiracy between Cheney's office and various energy company bigwigs to subvert environmental protection and rig the market began almost as soon as Bush hit the White House. The current subversion of corporate reform is, like Cheney's meetings with his cronies, covered by tissue thin rationalizations. Here is the reason given by the White house for refusing to fully fund the SEC
"The president does believe the S.E.C. has a substantial mission and we think $568 million is sufficient to carry that out," said Amy Call, a spokeswoman for the White House Office of Management and Budget.
Administration officials say that the budget figure in the law is too high considering the other needs of the budget. They say that the agency would be able to carry out more investigations, increase staff and raise pay levels with the more modest budget proposed by the White House."
The line about other needs of the budget is not quite a lie, but it does creep up to the starting line of falsification and crouches like a racer. For some reason, the article doesn't explain where the SEC's money comes from. Well, it comes from fees taken in by the SEC.
According to Congressional testimony in 2001,
"The current fees the SEC is required to collect � registration fees, transaction fees, and merger and tender offer fees ... will total almost $2.5 billion - an amount more than five times the SEC's current budget."
The Wall Street Journal recently published a five part series on what went wrong in the last three years. Interestingly, especially for a WSJ story, the concentration in the article three days ago was on five instances of either congressional interference, administrative decision, or Fed decisionmaking, that contributed to the slack regulatory posture of the nineties. One of them was Levitt's unsuccessful attempt to get the SEC fully funded -- to get control, that is, over the amount taken in by SEC fees. Phil Gramm quickly put a stop to that. Gramm, who is now going to ex-Enron central (UBS Warburg), is the very spirit of the Bush attitude towards free markets. It is the blind idea that, a., all regulations are the same, and b., that all regulations should be rolled back.
The depressing thing is, the Dems aren't going to fight for SEC funding. What, Joseph Lieberman leaning on his funders to enforce a bunch of pesky rules for the investing rubes? No way.
"Now, this bill also represents the first step in our administration's comprehensive program of financial deregulation. I particularly want to commend the leadership of the chairman, Senator Garn, and Chairman St Germain, along with Secretary Regan and his fine team at Treasury. They did a remarkable job forging a consensus within the Congress and among affected industries in favor of the bill's deregulatory provisions. I'd like to also thank Congressmen Stanton, Wylie, and LaFalce for their assistance.
What this legislation does is expand the powers of thrift institutions by permitting the industry to make commercial loans and increase their consumer lending. It reduces their exposure to changes in the housing market and in interest rate levels. This in turn will make the thrift industry a stronger, more effective force in financing housing for millions of Americans in the years to come."
These words of Ronald Reagan's, spoken at the signing of the Garn-St. Germain act, have echoed down the years, much like the last words of Kim Novak going through Jimmy Stewart's brain in Vertigo. Andrew Sullivan recently observed that Bartlett's Book of Quotations had too few Reagan quotes, proving an underlying left leaning bias. Surely, If LI were to edit a book of quotations, we'd select a few choice R.R. quotes. The lines from the speech above, for instance, would be place, on thematic lines, in the same section that included Willie Sutton's famous dictum that he robbed banks because that's where the money is. Yes, wasn't "reducing their exposure" and "expanding the powers of the thrift institutions" a nice way of saying, we're putting the tommyguns in the hands of the bank presidents? No need for a getaway car when you can't get the company to buy you a nice, corporate Lear jet. Indeed, it was that lot, from Charlie Keating to Herman Beebee, who proved that Sutton was a piker in the way of all freelance robbers. What you really need, when it comes to looting on an imperial scale, is friends in high places and a seat at the board. The best part is the lack of punishment. Not even lack -- the rewards that are heaped upon the larcenous are rich, rich indeed. Because bank robbery by bankers is met not with that ultimate social disapprobium, pinstripes and legchains, but by bail-outs, Reagan's stirring words eventually cost about 32 billion dollars a year to American taxpayers.
For the act that Reagan called the greatest "reform" of the financial industry in 50 years operated, as deregulatory reforms have operated since then, to create systemic problems, both in the S&Ls and then, by an easily tracked contagion, to the composition of corporate ownership as a whole, that eventually brought about a collapse. It was a collapse that, as conservative commentators like to say, was due to the government. Although what they don't say is that it was due to the Government deregulating an industry in a manner that was corrupt at the very root.
We bring up ancient history -- LI was once told we were all woulda, shoulda, coulda cause we keep bringing up ancient history, but you know what? We like it that way -- because we think the shape of the S&L crisis is very similar to the shape of the current crisis of confidence in the market, especially as it has to do with regulatory oversight, or the lack of it. LI wonders if there is a wave pattern here that speaks to a greater structure -- a long-term pattern of corruption that indicates structural invariants extending from the beginning of the Reagan years to now -- extending, that is, through the length of the post-Keynsian era. The contours of it, and the mechanisms that brought it about, have very little to do with the categories that are tossed around in public discourse. Especially unhelpful is the idea that the "government" is somehow opposed to "private enterprise." What happens in capitalism in our time is that alliances of interests, cutting across government and private lines, will marshall resources -- rule changes in regulatory agencies, Senatorial pressures on individual regulators or regulatory bodies, capital from banks, offshore entities, gaps in corporate governance, disguises made available by creative accounting, etc., to create systems of malfeasance that push great amounts of money into the hands of a few. Borrowing a term from Burroughs, let's call this the capitalist Interzone. This machinery is such that it can't last forever. It eventually implodes. The periodic crises in the system are explicitly linked to the high degree of inequity in the system, the corruption of the electoral process, and the inability to replace the money taken out of the system. The moment of implosion, though, will be unevenly distributed throughout the system, burdening those who benefitted least from it by way of taxes, looted pensions, firings, etc. During the S&L crisis, there was a window during which the D.C. co-conspirators of the process were actually held up to the light. Well, a few of them -- the infamous Keating five. This was entirely inadequate, of course. Everyone knew that the legislative orignators of the S&L deregulation process, Fernand St. Germain and Jake Garn, had benefited in the most outrageous ways from S&L largesse. But back then, there actually were symbols that represented a crucial part of the system.
This time around, nothing like that has happened. That is because the system has become much too pervasive to pick out five senators. There was a halfhearted attempt to hold Bush and Cheney symbolically responsible; it was half-hearted because no Senator or Representative -- nobody on the political scene -- can really afford to go after symbols of the system. This is especially noticeable in the case of Phil Gramm. If anybody represented a point man for Enron in the Senate, it was the horrid Gramm. He seems almost devised by some Dickensian god to recieve the slings and arrows of an outraged society, so porcine are his features, and his appetite, so open are his ties to the most corrupt American business to have gone under since Vesco days of yore. His wife's role in the Enron affair is common knowledge. Yet he's slipped out quietly, with no fuss made about his jumping ship to UBS Warburg.
The first phase of the current crisis is over. There are signs that the second phase has kicked in. In this phase, the system reverts back to its corrupt norm. There was much todo made in the conservative press that the reforms enacted this summer went "too far." This noise provides cover for the actual cutting back of those reforms. A story in the NYT this weekend heralds one sign of the reversion to the corrupt norm: the refusal to adequately fund the SEC.
"WASHINGTON, Oct. 18 � Less than three months ago, President Bush signed with great fanfare sweeping corporate antifraud legislation that called for a huge increase in the budget of the Securities and Exchange Commission to police corporate America and clean up Wall Street.
Now the White House is backing off the budget provision and urging Congress to provide the agency with 27 percent less money than the new law authorized.'
Bush and his congressional allies had no intention of stiffening the regulatory mechanisms that oversee corporate governance, accounting, and the markets until they had to, and they have no intention of seeing those new laws work. The last couple weeks, much has been made of the rollover at the new Public Company Accounting Oversight board. Jane Quinn's story, Is Reform a Bad Joke? is mis-named. It is a very good joke.
"At issue is the new Public Company Accounting Oversight Board, created by Congress and signed into law with a flourish by President Bush in July. It�s supposed to set new and higher standards for auditors, who check corporate books. To succeed, it will need a true reformer at its head.
The Securities and Exchange Commission will name the board�s members. As head, SEC chairman Harvey Pitt chose John Biggs�the respected CEO of the giant teacher�s pension fund, TIAA-CREF�say people in a position to know. But the big accounting firms (yes, like the ones that abetted Enron, Tyco, Xerox and WorldCom) scorn goody-goody reformers, and promptly called their political pals. Rep. Michael Oxley (R-Ohio) complained about Biggs and Pitt pulled back. (Oxley�s House committee just happens to oversee the SEC.)"
The SEC funding storry, coming on the heels of the Biggs debacle, isn't exactly a surprise. What does surprise us is the grossness of the maneuver. The Bush regime has consistently lived up to its coup origins: it's grand gestures are coup-like; it's spokesmen of a type made depressingly familiar in Latin America in the seventies, thuggish, happiest when employing junta-like categories in which a manichean world justifies a manichean hunt for subversives. But juntas usually take three to four years to go completely corrupt -- the Bush people are ahead of the game, here. The open conspiracy between Cheney's office and various energy company bigwigs to subvert environmental protection and rig the market began almost as soon as Bush hit the White House. The current subversion of corporate reform is, like Cheney's meetings with his cronies, covered by tissue thin rationalizations. Here is the reason given by the White house for refusing to fully fund the SEC
"The president does believe the S.E.C. has a substantial mission and we think $568 million is sufficient to carry that out," said Amy Call, a spokeswoman for the White House Office of Management and Budget.
Administration officials say that the budget figure in the law is too high considering the other needs of the budget. They say that the agency would be able to carry out more investigations, increase staff and raise pay levels with the more modest budget proposed by the White House."
The line about other needs of the budget is not quite a lie, but it does creep up to the starting line of falsification and crouches like a racer. For some reason, the article doesn't explain where the SEC's money comes from. Well, it comes from fees taken in by the SEC.
According to Congressional testimony in 2001,
"The current fees the SEC is required to collect � registration fees, transaction fees, and merger and tender offer fees ... will total almost $2.5 billion - an amount more than five times the SEC's current budget."
The Wall Street Journal recently published a five part series on what went wrong in the last three years. Interestingly, especially for a WSJ story, the concentration in the article three days ago was on five instances of either congressional interference, administrative decision, or Fed decisionmaking, that contributed to the slack regulatory posture of the nineties. One of them was Levitt's unsuccessful attempt to get the SEC fully funded -- to get control, that is, over the amount taken in by SEC fees. Phil Gramm quickly put a stop to that. Gramm, who is now going to ex-Enron central (UBS Warburg), is the very spirit of the Bush attitude towards free markets. It is the blind idea that, a., all regulations are the same, and b., that all regulations should be rolled back.
The depressing thing is, the Dems aren't going to fight for SEC funding. What, Joseph Lieberman leaning on his funders to enforce a bunch of pesky rules for the investing rubes? No way.
Friday, October 18, 2002
Remora
Gotzendammerung
The Channel between the French and the English has marvelous metaphysical qualities: as ideas swim back and forth, they suffer a sea-change of sometimes monstrous proportions. French ideas, to the cold Anglo philosophe, at least since Burke, seem like so much congealed vichysoisse: repulsive, illogical, and smelly. Anglo ideas, to the fervent French, are either Blakean visions encoded in logical paradoxes (which is how Deleuze saw Lewis Carroll and Russell) or Benthamite panopiticons -- systems of cruelty diffused by way of capitalist reason, where every man carries to a butcher's market his own meat, and is consequently processed into slices.
Peter Conrad is, I believe, Australian. His review of Surya's book about George Bataille in the Observer is both sympathetic and incredulous. LI think he distorts Bataille, but he makes an arguable case. Conrad does contrive an utterly beautiful summary of Story of the Eye:
"The etchings made by Hans Bellmer in 1944 to illustrate Bataille's scabrous novel Story of the Eye concentrate on the two blind, gaping eyes between the splayed legs of women: sex is a surgical probe, an experimental invasion of the darkness and a foretaste of extinction. Bataille's heroine Simone removes the eye of a priest from its socket and, slicing through its ligaments, inserts it into her vagina. There it can scrutinise the matted jungle of our dreams."
Here's the passage in L'histoire itself:
"Ensuite je me levai et, en �cartant les cuisses de Simone, qui s'�tait couch�e sur le c�t�, je me trouvai en face de ce que, je me le figure ainsi, j'attendais depuis toujours de le m�me fa�on qu'une guillotine attend un cou � trancher. Il me semblait m�me que mes yeux sortaient de la t�te comme s'ils �taient �rectiles � force d'horreur; je vis exactement, dans le vagin velu de Simone, l'oeil bleu p�le de Marcelle qui me regardait en pleurant des larmes d'urine."
Which we won't translate.
He also, LI thinks, rather maliciously offers this view of Bataille's "political economy":
"Surya also fudges the issue of Bataille's affinity with fascism, which in his view concluded 'the decay of mankind' and definitively disproved the humanist faith in our lofty status. Bataille likened Auschwitz to the Pyramids or the Acropolis: it was a talisman of civilisation, a wonder of the modern world. He was equally elated by the instantaneous flattening of Hiroshima, which demonstrated man's capacity to terminate his own history and exterminate the earth itself."
The key words here: civilization, elation, humanist -- have, as Conrad must know, a different tone for Bataille than they have for the average Guardian reader. Although I'm unaware of the Bataillian comparison of Auschwitz and the Acropolis, I'm quite aware of the Part maudite, in which the theme of ritualized cruelty and civilization -- or social organization, which is what Bataille, founder (as Conrad does not reveal) of the College de sociologie, was getting at -- is explained in terms of the discord (and the consequent dialectic) between utility and sovereignty. Bataille's changing position on fascism -- from an early fascination to opposition -- is an arc common to a lot of European intellectuals of the twenties and thirties. The opposition to humanism was an opposition to the easy synthesis of calculation and affection, forged in bourgeois nineteenth century societies, and fatally undermined in WWI. Bataille did not believe that parlimentary democracy would endure because it could not sublimate in any grand symbolic way the violence which, for Bataille, was the suture at the heart of the social -- the trace of a dialectical failure, insofar as the dialectic is, indeed, Hegelian. That violence does have as its ultimate object nothing at all -- what Victor Turner calls the symbolic object, what Lacan (and Laurie Anderson) call x.
Of course, there are some howlers in the review -- you can't discuss philosophy in a forum like the Guardian without getting it through Guardian editors -- and newspaper editors are notoriously prone to make "sense" of philosophical arguments, destroying them in the process. Here's the big howler in this review:
"Being an earnest French philosopher, Surya is obliged to take such assertions seriously, and he sees in them 'the political formulation of a supreme morality'. I suspect that Bataille adopted extreme positions in a spirit of zany, cunning frivolity. As a surrealist, he understood the uses of effrontery, and he is probably best understood as a subversive intellectual comedian - a jester devoted, like Erasmus, to the praise of folly rather than sagacity. He met Henri Bergson on a trip to London, and prepared himself by reading his essay on comedy. Bergson treated laughter as our guide to the abyss, plumbing 'the depth of worlds' and chastising the sedate certitudes of morality; the absurd, extravagant foulness of Story of the Eye - its garrottings, its random couplings, its sacrilegious mockery - filled Bataille with an unholy merriment, a 'fulminating joy, bordering on naive folly'. Like the little boy in the poem, his primary purpose was to annoy."
Surely the sentence starting "Bergson treated laughter..." should read, "Bataille treated laughter..." Anybody who has read Bergson on laughter knows that he conceived it as, centrally, a form of mechanical mimicry, a category mistake, with the categories being life and mechanism. Bataille, on the other hand, called laughter a way of spitting out language itself, the reassertionof the primal, organic mouth over the sense-making tool it becomes in socialization.
Bataille was fascinated by a sort of line that he drew from the pole of the mouth to the pole of the anus. LI used to be fascinated by that line, too. We absorbed Bataille, at one time, into our very bloodstream. It wasn't, in retrospect, a good idea. Or so we have thought for a number of years. Lately, we have been nostalgic for our naughtier years. The peak of our Bataille infatuation probably came several years ago, when we were living in Atlanta, working at a bookstore, and involved with awoman (let's call her X) who was afflicted with bipolar depression and a husband. She came in after we'd been hired. We were sitting in the lunch room, when she and a rather chubby young man, her co-hire, came in and were introduced. She was scrawny, had graying hair, and lively eyes. I came to know and love that scrawniness, but she rang a lot of bells at first. I was the person who was in charge of the psychology books, and the erotica. At the mention of erotica, X came alive. She loved erotica. Well, so did LI. We've always loved erotica, porno, all the trawling through the bodies struggles, pores and marks and moans and disappointments and holes and hairs, all of it, all of it -- but we are no longer so discursive about this. At that time, Bataille's project -- the production of the sovereign human being, one who shucks off the merely human -- seemed absolutely right. X was into it, until X slashed her wrists, and the spiral went quickly down.
So... we have our own personal doubts about Bataille. The way a stockbroker from the eighties might have doubts about cocaine. To produce the strong effect of Bataille's rhetoric, we would need to quote extensively -- we admit that we haven't given up entirely Bataille's absurd project. Here's a passage we often think of:
"A un moment donn�, je suis all� � la fen�tre et je l'ai ouverte ... Dans la rue juste devant moi, il y avait une tr�s longue banderole noire ... Le vent avait � moiti� d�croch� la hampe : elle avait l'air de battre de l'aile. Elle ne tombait pas: elle claquait dans le vent avec un grand bruit � hauteur du toit: elle se d�roulait en prenant des formes tourment�es: comme un ruisseau d'encre qui aurait coul� dans les nuages. L'incident para�t �tranger � mon histoire, mais c' �tait pour moi comme si une poche d'encre s'ouvrait dans ma t�te et j' �tais s�r, ce jour-l�, de mourir sans tarder
Finally, here is a chronology of Bataille's life composed by Surya.
Gotzendammerung
The Channel between the French and the English has marvelous metaphysical qualities: as ideas swim back and forth, they suffer a sea-change of sometimes monstrous proportions. French ideas, to the cold Anglo philosophe, at least since Burke, seem like so much congealed vichysoisse: repulsive, illogical, and smelly. Anglo ideas, to the fervent French, are either Blakean visions encoded in logical paradoxes (which is how Deleuze saw Lewis Carroll and Russell) or Benthamite panopiticons -- systems of cruelty diffused by way of capitalist reason, where every man carries to a butcher's market his own meat, and is consequently processed into slices.
Peter Conrad is, I believe, Australian. His review of Surya's book about George Bataille in the Observer is both sympathetic and incredulous. LI think he distorts Bataille, but he makes an arguable case. Conrad does contrive an utterly beautiful summary of Story of the Eye:
"The etchings made by Hans Bellmer in 1944 to illustrate Bataille's scabrous novel Story of the Eye concentrate on the two blind, gaping eyes between the splayed legs of women: sex is a surgical probe, an experimental invasion of the darkness and a foretaste of extinction. Bataille's heroine Simone removes the eye of a priest from its socket and, slicing through its ligaments, inserts it into her vagina. There it can scrutinise the matted jungle of our dreams."
Here's the passage in L'histoire itself:
"Ensuite je me levai et, en �cartant les cuisses de Simone, qui s'�tait couch�e sur le c�t�, je me trouvai en face de ce que, je me le figure ainsi, j'attendais depuis toujours de le m�me fa�on qu'une guillotine attend un cou � trancher. Il me semblait m�me que mes yeux sortaient de la t�te comme s'ils �taient �rectiles � force d'horreur; je vis exactement, dans le vagin velu de Simone, l'oeil bleu p�le de Marcelle qui me regardait en pleurant des larmes d'urine."
Which we won't translate.
He also, LI thinks, rather maliciously offers this view of Bataille's "political economy":
"Surya also fudges the issue of Bataille's affinity with fascism, which in his view concluded 'the decay of mankind' and definitively disproved the humanist faith in our lofty status. Bataille likened Auschwitz to the Pyramids or the Acropolis: it was a talisman of civilisation, a wonder of the modern world. He was equally elated by the instantaneous flattening of Hiroshima, which demonstrated man's capacity to terminate his own history and exterminate the earth itself."
The key words here: civilization, elation, humanist -- have, as Conrad must know, a different tone for Bataille than they have for the average Guardian reader. Although I'm unaware of the Bataillian comparison of Auschwitz and the Acropolis, I'm quite aware of the Part maudite, in which the theme of ritualized cruelty and civilization -- or social organization, which is what Bataille, founder (as Conrad does not reveal) of the College de sociologie, was getting at -- is explained in terms of the discord (and the consequent dialectic) between utility and sovereignty. Bataille's changing position on fascism -- from an early fascination to opposition -- is an arc common to a lot of European intellectuals of the twenties and thirties. The opposition to humanism was an opposition to the easy synthesis of calculation and affection, forged in bourgeois nineteenth century societies, and fatally undermined in WWI. Bataille did not believe that parlimentary democracy would endure because it could not sublimate in any grand symbolic way the violence which, for Bataille, was the suture at the heart of the social -- the trace of a dialectical failure, insofar as the dialectic is, indeed, Hegelian. That violence does have as its ultimate object nothing at all -- what Victor Turner calls the symbolic object, what Lacan (and Laurie Anderson) call x.
Of course, there are some howlers in the review -- you can't discuss philosophy in a forum like the Guardian without getting it through Guardian editors -- and newspaper editors are notoriously prone to make "sense" of philosophical arguments, destroying them in the process. Here's the big howler in this review:
"Being an earnest French philosopher, Surya is obliged to take such assertions seriously, and he sees in them 'the political formulation of a supreme morality'. I suspect that Bataille adopted extreme positions in a spirit of zany, cunning frivolity. As a surrealist, he understood the uses of effrontery, and he is probably best understood as a subversive intellectual comedian - a jester devoted, like Erasmus, to the praise of folly rather than sagacity. He met Henri Bergson on a trip to London, and prepared himself by reading his essay on comedy. Bergson treated laughter as our guide to the abyss, plumbing 'the depth of worlds' and chastising the sedate certitudes of morality; the absurd, extravagant foulness of Story of the Eye - its garrottings, its random couplings, its sacrilegious mockery - filled Bataille with an unholy merriment, a 'fulminating joy, bordering on naive folly'. Like the little boy in the poem, his primary purpose was to annoy."
Surely the sentence starting "Bergson treated laughter..." should read, "Bataille treated laughter..." Anybody who has read Bergson on laughter knows that he conceived it as, centrally, a form of mechanical mimicry, a category mistake, with the categories being life and mechanism. Bataille, on the other hand, called laughter a way of spitting out language itself, the reassertionof the primal, organic mouth over the sense-making tool it becomes in socialization.
Bataille was fascinated by a sort of line that he drew from the pole of the mouth to the pole of the anus. LI used to be fascinated by that line, too. We absorbed Bataille, at one time, into our very bloodstream. It wasn't, in retrospect, a good idea. Or so we have thought for a number of years. Lately, we have been nostalgic for our naughtier years. The peak of our Bataille infatuation probably came several years ago, when we were living in Atlanta, working at a bookstore, and involved with awoman (let's call her X) who was afflicted with bipolar depression and a husband. She came in after we'd been hired. We were sitting in the lunch room, when she and a rather chubby young man, her co-hire, came in and were introduced. She was scrawny, had graying hair, and lively eyes. I came to know and love that scrawniness, but she rang a lot of bells at first. I was the person who was in charge of the psychology books, and the erotica. At the mention of erotica, X came alive. She loved erotica. Well, so did LI. We've always loved erotica, porno, all the trawling through the bodies struggles, pores and marks and moans and disappointments and holes and hairs, all of it, all of it -- but we are no longer so discursive about this. At that time, Bataille's project -- the production of the sovereign human being, one who shucks off the merely human -- seemed absolutely right. X was into it, until X slashed her wrists, and the spiral went quickly down.
So... we have our own personal doubts about Bataille. The way a stockbroker from the eighties might have doubts about cocaine. To produce the strong effect of Bataille's rhetoric, we would need to quote extensively -- we admit that we haven't given up entirely Bataille's absurd project. Here's a passage we often think of:
"A un moment donn�, je suis all� � la fen�tre et je l'ai ouverte ... Dans la rue juste devant moi, il y avait une tr�s longue banderole noire ... Le vent avait � moiti� d�croch� la hampe : elle avait l'air de battre de l'aile. Elle ne tombait pas: elle claquait dans le vent avec un grand bruit � hauteur du toit: elle se d�roulait en prenant des formes tourment�es: comme un ruisseau d'encre qui aurait coul� dans les nuages. L'incident para�t �tranger � mon histoire, mais c' �tait pour moi comme si une poche d'encre s'ouvrait dans ma t�te et j' �tais s�r, ce jour-l�, de mourir sans tarder
Finally, here is a chronology of Bataille's life composed by Surya.
Thursday, October 17, 2002
Remora
Nietzsche's birthday (as well as that of one of his commentators, my friend Kathy Higgins) was yesterday. In his honor, here's a translation of one of his Dawn of Day numbers:
"The fearful eye - Nothing is more feared by artists, poets and writers than that eye which sees their petty deceits, and which by and by perceives how often they have stood on the border where the paths led either to innocent pleasure in itself or to the making of effects; which can write up the tab for them, when they have purchased too little with too much, knowing when they have sought to elevate and ornament, without themselves being elevated in the least; which penetrates the thought through all the disguises of their art as it first stood before them, perhaps as a shimmering figure of light, but perhaps, also, as a theft of the common-place, that they have had to extend, abbreviate, color, complicate, pepper, in order to make something of it - oh this eye, which spots in your works all your discomfort, your spying and greed, your imitation and excess (which is just envious mimicry), which knows your embarrassed blushes all too well, as it knows the art you employ to disguise these blushes, and to explain them away even to yourself!"
The evil eye of the critic -- dragging with it that vague,Volkish dread -- is naturally not liked. LI pictures it as one of those symbolist lithographs, an eye floating through space like a big, malign hot air balloon. Something Rops, or Moreau, might have drawn.
Those blushes (Schamrote) -- yes, we know those blushes. LI once wrote several large reviews for the Austin Chronicle. Large in the NYRB scale. They were on various topics -- cancer, the economy, the environment. And every time, some paragraph, some sentence, some word would stand out -- and we would feel intense shame. Because it would be a dumb sentence, the wrong word. Mostly this was our fault -- in the process of editing, we had let it pass.
But let's congratulate ourselves on one thing, shall we? We have not felt the blush that comes from presenting a dishonest argument. Unfortunately, Christopher Caldwell should be blushing this week for his column in the NYPress.
Caldwell is good, as we've said before. Somewhere before, you find the post. While Caldwell is a conservative, he is not dogmatic, or stupid. He is a briliant reader -- we read his book reviews with unmitigated respect. And LI has always assumed that Caldwell has that ineffable quality, intellectual integrity. But this column should bring on a major case of Nietzsche's Schamrote. A lot has been written about the Left's whiny response to 9/11, and how the Left is disconnected from basic human emotions of loyalty to the locale, etc. Well, in our opinion, the proposed war in Iraq has had an amazingly corrupting affect on the Right.
We mean something, well, very Nietzschian by intellectual integrity. The standard comes from science. You can be a pundit, you can be an economist, you can be a journalist, but the standard comes from a discourse that has organized itself around the proof process. That doesn't mean that pundits should experiment, or refuse the evidence of their sensibilities -- that qualitative evidence is what is most valuable about the propos, the opinion column. But opinion has standards. The pundit imagination, like any cognitive effort, should conform to a social duty. This duty is to imagine counter-factuals. Derived from this duty is the duty to understand the selective exhibition of evidence.
These are the first two grafs of Caldwell's column:
"In the days leading up to Thursday�s overwhelming House vote to let the President attack Iraq, consultant Bob Shrum and pollster Stanley Greenberg were sending a memo to Democratic candidates explaining how to handle the vote without getting burned. The stakes were high. Elections are three weeks off, and the public loves the President�s position on this one. If the U.S. has to go it alone against Saddam Hussein, the country will be in favor, by 46 percent to 29, according to a Harris poll. With an okay from the UN Security Council, support for the operation rises to 91-2.
"Shrum and Greenberg proposed to get their guys out of a pickle by having them take both sides of the Iraq issue. Peaceniks could avoid looking soft on Saddam by burying their objections beneath assurances of "support for the war on terrorism in general." But gung-ho warriors should also hedge their bets, since, according to Greenberg�s polling, "the down-the-line supporter of the President in Iraq actually runs significantly weaker than the proponent with reservations."
The public loves the President's position on this one? Caldwell isn't stupid. He knows that the Harris poll he is quoting is one of several polls, and that collectively they have pictured much more ambiguity than Caldwell allows for. He cherrypicked the most gung-ho poll to shore up his position -- for Caldwell does, indeed, love the President's position.
Meaning, LI thinks, the position that he assumes Bush has, which is going in and invading Iraq, rather than the position presented in the Cincinnati speech, which could plausibly be headlined in Europe as backing away from war.
It isn't that LI thinks the anti-war position is popular. Whether it is popular or not, it is our position. But the idea of an aroused populace, which is what Caldwell implies, is a mirage. Here's the latest Gallop poll:
"But the current results suggest a somewhat different scenario. According to the poll, Democrats enjoy an electoral advantage among those who care most deeply about the economy and those most concerned with the possibility of war with Iraq, suggesting that there may be a protest vote on both issues. Likely voters who cite Iraq as the most important issue, for example, oppose invading that country by a two-to-one margin, 66% to 33%. They also indicate they would vote for Democrats over Republicans by a 16-point margin, 56% to 40%. By contrast, among all likely voters, opinion on war with Iraq is evenly divided (47% favor invasion, 46% oppose), as is the vote for the two parties."
Now, Caldwell might think this Gallop poll is wrong. But no poll that I've seen, besides the Harris figures he quotes, would lead anyone to say the public loves the President's position on the war. And that variability of responses, those shifts, tells us that love is precisely the wrong word. The public loved the Afghan invasion. But it doesn't love the proposed Iraq invasion, even though it will support it.
That doesn't mean Caldwell couldn't have made a case from his own impressions that the war will be popular. Or that the Harris poll is necessarily wrong -- I could imagine arguments that would shore it up. But quoting it, as Caldwell does, without referring to the number of other polls that contradict it, is intellectually dishonest. It is the difference between political forecasting and political p.r. -- the latter of whcih consists of trying to make something popular by calling it popular. In the world of stock market speculation, this is known as the greater fool theory -- you buy a stock in order to sell it at a higher price by pumping it up, regardless of its fundamental value. Caldwell should be better than this. But Iraq has this corrupting effect on the right wing. Bad news when we do (and LI thinks we will) invade -- the same meretricious analyses, the same credibility gap opening between what is really happening and the propaganda at home. Vietnam really is looming on the horizon. And it is not going to be good for the Right, we think.
Nietzsche's birthday (as well as that of one of his commentators, my friend Kathy Higgins) was yesterday. In his honor, here's a translation of one of his Dawn of Day numbers:
"The fearful eye - Nothing is more feared by artists, poets and writers than that eye which sees their petty deceits, and which by and by perceives how often they have stood on the border where the paths led either to innocent pleasure in itself or to the making of effects; which can write up the tab for them, when they have purchased too little with too much, knowing when they have sought to elevate and ornament, without themselves being elevated in the least; which penetrates the thought through all the disguises of their art as it first stood before them, perhaps as a shimmering figure of light, but perhaps, also, as a theft of the common-place, that they have had to extend, abbreviate, color, complicate, pepper, in order to make something of it - oh this eye, which spots in your works all your discomfort, your spying and greed, your imitation and excess (which is just envious mimicry), which knows your embarrassed blushes all too well, as it knows the art you employ to disguise these blushes, and to explain them away even to yourself!"
The evil eye of the critic -- dragging with it that vague,Volkish dread -- is naturally not liked. LI pictures it as one of those symbolist lithographs, an eye floating through space like a big, malign hot air balloon. Something Rops, or Moreau, might have drawn.
Those blushes (Schamrote) -- yes, we know those blushes. LI once wrote several large reviews for the Austin Chronicle. Large in the NYRB scale. They were on various topics -- cancer, the economy, the environment. And every time, some paragraph, some sentence, some word would stand out -- and we would feel intense shame. Because it would be a dumb sentence, the wrong word. Mostly this was our fault -- in the process of editing, we had let it pass.
But let's congratulate ourselves on one thing, shall we? We have not felt the blush that comes from presenting a dishonest argument. Unfortunately, Christopher Caldwell should be blushing this week for his column in the NYPress.
Caldwell is good, as we've said before. Somewhere before, you find the post. While Caldwell is a conservative, he is not dogmatic, or stupid. He is a briliant reader -- we read his book reviews with unmitigated respect. And LI has always assumed that Caldwell has that ineffable quality, intellectual integrity. But this column should bring on a major case of Nietzsche's Schamrote. A lot has been written about the Left's whiny response to 9/11, and how the Left is disconnected from basic human emotions of loyalty to the locale, etc. Well, in our opinion, the proposed war in Iraq has had an amazingly corrupting affect on the Right.
We mean something, well, very Nietzschian by intellectual integrity. The standard comes from science. You can be a pundit, you can be an economist, you can be a journalist, but the standard comes from a discourse that has organized itself around the proof process. That doesn't mean that pundits should experiment, or refuse the evidence of their sensibilities -- that qualitative evidence is what is most valuable about the propos, the opinion column. But opinion has standards. The pundit imagination, like any cognitive effort, should conform to a social duty. This duty is to imagine counter-factuals. Derived from this duty is the duty to understand the selective exhibition of evidence.
These are the first two grafs of Caldwell's column:
"In the days leading up to Thursday�s overwhelming House vote to let the President attack Iraq, consultant Bob Shrum and pollster Stanley Greenberg were sending a memo to Democratic candidates explaining how to handle the vote without getting burned. The stakes were high. Elections are three weeks off, and the public loves the President�s position on this one. If the U.S. has to go it alone against Saddam Hussein, the country will be in favor, by 46 percent to 29, according to a Harris poll. With an okay from the UN Security Council, support for the operation rises to 91-2.
"Shrum and Greenberg proposed to get their guys out of a pickle by having them take both sides of the Iraq issue. Peaceniks could avoid looking soft on Saddam by burying their objections beneath assurances of "support for the war on terrorism in general." But gung-ho warriors should also hedge their bets, since, according to Greenberg�s polling, "the down-the-line supporter of the President in Iraq actually runs significantly weaker than the proponent with reservations."
The public loves the President's position on this one? Caldwell isn't stupid. He knows that the Harris poll he is quoting is one of several polls, and that collectively they have pictured much more ambiguity than Caldwell allows for. He cherrypicked the most gung-ho poll to shore up his position -- for Caldwell does, indeed, love the President's position.
Meaning, LI thinks, the position that he assumes Bush has, which is going in and invading Iraq, rather than the position presented in the Cincinnati speech, which could plausibly be headlined in Europe as backing away from war.
It isn't that LI thinks the anti-war position is popular. Whether it is popular or not, it is our position. But the idea of an aroused populace, which is what Caldwell implies, is a mirage. Here's the latest Gallop poll:
"But the current results suggest a somewhat different scenario. According to the poll, Democrats enjoy an electoral advantage among those who care most deeply about the economy and those most concerned with the possibility of war with Iraq, suggesting that there may be a protest vote on both issues. Likely voters who cite Iraq as the most important issue, for example, oppose invading that country by a two-to-one margin, 66% to 33%. They also indicate they would vote for Democrats over Republicans by a 16-point margin, 56% to 40%. By contrast, among all likely voters, opinion on war with Iraq is evenly divided (47% favor invasion, 46% oppose), as is the vote for the two parties."
Now, Caldwell might think this Gallop poll is wrong. But no poll that I've seen, besides the Harris figures he quotes, would lead anyone to say the public loves the President's position on the war. And that variability of responses, those shifts, tells us that love is precisely the wrong word. The public loved the Afghan invasion. But it doesn't love the proposed Iraq invasion, even though it will support it.
That doesn't mean Caldwell couldn't have made a case from his own impressions that the war will be popular. Or that the Harris poll is necessarily wrong -- I could imagine arguments that would shore it up. But quoting it, as Caldwell does, without referring to the number of other polls that contradict it, is intellectually dishonest. It is the difference between political forecasting and political p.r. -- the latter of whcih consists of trying to make something popular by calling it popular. In the world of stock market speculation, this is known as the greater fool theory -- you buy a stock in order to sell it at a higher price by pumping it up, regardless of its fundamental value. Caldwell should be better than this. But Iraq has this corrupting effect on the right wing. Bad news when we do (and LI thinks we will) invade -- the same meretricious analyses, the same credibility gap opening between what is really happening and the propaganda at home. Vietnam really is looming on the horizon. And it is not going to be good for the Right, we think.
Tuesday, October 15, 2002
Remora
The journalist beat
For months, LI has been beating on a drum that is made out of the cyber-skin of James Glassman. The disintegration of the business press, which in the last week saw two more casualties -- Forbes ASAP and Upside -- has not prompted the kind of investigative fervor that is revved up by, say, the kidnapping of blond California tykes. Still, there's a lot to say about it, and we've been boringly, boringly on target about this issue. Well, in memes we trust -- Washington Monthly has an article about this topic by journalist Philip Longman. Longman begins in the self-critical mode, although it never reaches a properly Maoist depth. Here's a couple of grafs from the meat of the article:
"I was once proud of my profession and resentful of those who criticized it. For more than 20 years, I rode the great boom in business journalism that began in the early 1980s. I like to believe that at least some of my stories helped to enlighten readers and remedy wrongdoing. But today, I'm more likely to admit--at least on a bad day--that I spent my youth hustling Tyco shares to senior citizens.
Just as Americans put far too much faith in the integrity and intellectual prowess of stock analysts and other supposedly disinterested financial watchdogs during the boom, they also put far too much stock in business journalism, and have a right to be disappointed and angry. Like many of the industries we once covered, business journalists built their own bubble during the last decade. And now--as is appropriate for an industry that grew rich by dishing out so much bad advice and flabby reporting--business journalism is currently suffering the same financial fate as Wall Street and Silicon Valley. The Industry Standard --where reporters once took time off from chronicling the achievements of dot-com heroes to enjoy in-house massages and open-bar parties graced by belly dancers--is history, along with many other formerly high-riding business rags. And even the most venerable and established business publications are in trouble. The Wall Street Journal has suffered huge layoffs. Forbes, no longer profitable, is reducing staff and executive salaries, eliminating the 401(k) plan, and raising cash by auctioning off old man Forbes's various art collections. Business Week , which championed the "new economy" and in the late 1990s proclaimed an end to the business cycle, saw its advertising plunge from 6,000 pages in 2000 to 3,786 last year, and may finish 2002 with even fewer."
So far, so good. Alas, Longman, revving up for some fancy shooting, never takes a nice shot at a named target -- besides the obvious Cramer and Glassman. This is one way to cover your behind: criticize the bubble of biz journalism without naming the journalists. Worse, Longman apparently believes strongly in the Efficient markets theory. That this theory conflicts with the use of the term bubble, which he sensibly employs, doesn't seem to phase him:
"Few business journalists spend much time analyzing balance sheets. But even if they did, they wouldn't be of much help to folks trying to figure out how to invest their 401(k)s. This truth was forced on me when I set out to learn high finance (after years of writing about it) at Columbia Business School. Here I was, a 40-something guy on a fellowship for mid-career business journalists, surrounded by 20-something whiz kids who would shortly go off with their newly minted MBAs to dazzle Wall Street. And what was the first lesson our finance professor drove home? That even after spending two years and $60,000 at Columbia Business School, none of them would be able to outperform the markets except by sheer luck or inside information."
If Longman really believes his second sentence, than he can't really blame business journalists for the negligence alluded to in the first sentence. Oddly, he doesn't reflect on the contradiction. LI thinks that Longman is right, if he is floundering towards the proposition that business journalists should not think of their jobs as that of advising investors, as opposed to informing the public.
Still, the idea that an MBA won't be able to outperform the market over the long hall is, firstly, contradicted by some well known instances (among them Warren Buffett); and second, depends on breaking up the market into time segments, and elastic definitions of risk that are convenient to the EMH guys. In fact, Longman's discovery of this principal couldn't have been worse timed. During a down market, the pick and chose method of investment emerges as a competitive speculative tool in comparison with the idea of parking your money with a money fund and forgetting about it.
A good critique of EMH is this paper written by Andrew Smithers and Stephen Wright. The discrepency between bubble talk and EMH talk is revealed by what Smithers and Wright call the "extreme form" of EMH: that financial markets adjust immediately and perfectly to new information. Thus, the three hundred some point rise in the NYSE Friday represented a perfect adjustment of markets to new information. That information has to do with the fundamental prices of stocks. Well, although EMH detours around the problem of short term volatility, I buy Smithers and Wrights story about predictable regularities in the market that count against the premises of EMH. Smithers and Wright talk about one of them that we are getting acquainted with over the past two years: "...stock returns are negatively correlated to over the long term, so that periods of high stock returns are typically followed by periods of low returns." The EMH view, which has an ideological quotient that satisfies your average libertarian economist, is what the Longmans will always hear in their classes at Columbia. Joseph Stiglitz won the Nobel Prize, a couple of years ago, for showing that perfect efficiency would collapse the market. The market will always be incomplete, and the information distributed through it will always be assymetrical. Neither Stiglitz nor the experiments of behaviorial economists have made, or will make, a dent in the equilibrium model.
So, Longman should have thought a little bit before unsealing his astonishing revelations among the hotshot MBAs.
The journalist beat
For months, LI has been beating on a drum that is made out of the cyber-skin of James Glassman. The disintegration of the business press, which in the last week saw two more casualties -- Forbes ASAP and Upside -- has not prompted the kind of investigative fervor that is revved up by, say, the kidnapping of blond California tykes. Still, there's a lot to say about it, and we've been boringly, boringly on target about this issue. Well, in memes we trust -- Washington Monthly has an article about this topic by journalist Philip Longman. Longman begins in the self-critical mode, although it never reaches a properly Maoist depth. Here's a couple of grafs from the meat of the article:
"I was once proud of my profession and resentful of those who criticized it. For more than 20 years, I rode the great boom in business journalism that began in the early 1980s. I like to believe that at least some of my stories helped to enlighten readers and remedy wrongdoing. But today, I'm more likely to admit--at least on a bad day--that I spent my youth hustling Tyco shares to senior citizens.
Just as Americans put far too much faith in the integrity and intellectual prowess of stock analysts and other supposedly disinterested financial watchdogs during the boom, they also put far too much stock in business journalism, and have a right to be disappointed and angry. Like many of the industries we once covered, business journalists built their own bubble during the last decade. And now--as is appropriate for an industry that grew rich by dishing out so much bad advice and flabby reporting--business journalism is currently suffering the same financial fate as Wall Street and Silicon Valley. The Industry Standard --where reporters once took time off from chronicling the achievements of dot-com heroes to enjoy in-house massages and open-bar parties graced by belly dancers--is history, along with many other formerly high-riding business rags. And even the most venerable and established business publications are in trouble. The Wall Street Journal has suffered huge layoffs. Forbes, no longer profitable, is reducing staff and executive salaries, eliminating the 401(k) plan, and raising cash by auctioning off old man Forbes's various art collections. Business Week , which championed the "new economy" and in the late 1990s proclaimed an end to the business cycle, saw its advertising plunge from 6,000 pages in 2000 to 3,786 last year, and may finish 2002 with even fewer."
So far, so good. Alas, Longman, revving up for some fancy shooting, never takes a nice shot at a named target -- besides the obvious Cramer and Glassman. This is one way to cover your behind: criticize the bubble of biz journalism without naming the journalists. Worse, Longman apparently believes strongly in the Efficient markets theory. That this theory conflicts with the use of the term bubble, which he sensibly employs, doesn't seem to phase him:
"Few business journalists spend much time analyzing balance sheets. But even if they did, they wouldn't be of much help to folks trying to figure out how to invest their 401(k)s. This truth was forced on me when I set out to learn high finance (after years of writing about it) at Columbia Business School. Here I was, a 40-something guy on a fellowship for mid-career business journalists, surrounded by 20-something whiz kids who would shortly go off with their newly minted MBAs to dazzle Wall Street. And what was the first lesson our finance professor drove home? That even after spending two years and $60,000 at Columbia Business School, none of them would be able to outperform the markets except by sheer luck or inside information."
If Longman really believes his second sentence, than he can't really blame business journalists for the negligence alluded to in the first sentence. Oddly, he doesn't reflect on the contradiction. LI thinks that Longman is right, if he is floundering towards the proposition that business journalists should not think of their jobs as that of advising investors, as opposed to informing the public.
Still, the idea that an MBA won't be able to outperform the market over the long hall is, firstly, contradicted by some well known instances (among them Warren Buffett); and second, depends on breaking up the market into time segments, and elastic definitions of risk that are convenient to the EMH guys. In fact, Longman's discovery of this principal couldn't have been worse timed. During a down market, the pick and chose method of investment emerges as a competitive speculative tool in comparison with the idea of parking your money with a money fund and forgetting about it.
A good critique of EMH is this paper written by Andrew Smithers and Stephen Wright. The discrepency between bubble talk and EMH talk is revealed by what Smithers and Wright call the "extreme form" of EMH: that financial markets adjust immediately and perfectly to new information. Thus, the three hundred some point rise in the NYSE Friday represented a perfect adjustment of markets to new information. That information has to do with the fundamental prices of stocks. Well, although EMH detours around the problem of short term volatility, I buy Smithers and Wrights story about predictable regularities in the market that count against the premises of EMH. Smithers and Wright talk about one of them that we are getting acquainted with over the past two years: "...stock returns are negatively correlated to over the long term, so that periods of high stock returns are typically followed by periods of low returns." The EMH view, which has an ideological quotient that satisfies your average libertarian economist, is what the Longmans will always hear in their classes at Columbia. Joseph Stiglitz won the Nobel Prize, a couple of years ago, for showing that perfect efficiency would collapse the market. The market will always be incomplete, and the information distributed through it will always be assymetrical. Neither Stiglitz nor the experiments of behaviorial economists have made, or will make, a dent in the equilibrium model.
So, Longman should have thought a little bit before unsealing his astonishing revelations among the hotshot MBAs.
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