Investing in the Future

People's Capitalism- the economics of James Albus.

A curious thing happened on the way to a recent post about the cerebellum. One of its primary theorists was not a neurobiologist, but an engineer, roboticist, and control system designer. It turned out that James Albus, mild-mannered government employee all of his career, had several side projects, another one of which was an odd blend of libertarian and communist economics, which he called peoples' capitalism. It incorporates some unconventional monetary theory, and throws in a proposal for oceanic algae harvesting as a bonus. All in all, Albus is clearly a fellow crank.

This book "Path to a Better World" is not easy to find, probably for good reason. Putting aside its lengthy self-encomiums and visions for a peaceful and problem-free future, the basic proposition is that the government should issue credit to everyone for the purpose of setting up a personal investment fund, which over time would then generate on everyone's behalf a steady and growing stream of income that will replace that lost from the automation revolution to come (and pay back the original loan). He estimates that if the annual increment is $5,000, the portfolio would be worth $1.5 million after 50 years, generating $55,000 of income. This would all be invested in government-approved vehicles like mutual funds, thereby increasing total capital investment. And lastly, to offset inflation, he proposes a payroll deduction-style system whereby some proportion of each person's income could be forcibly diverted to savings when inflation threatens.

One of the core justifications of these schemes is gaining a higher rate of overall capital investment. Albus recounts some of the interesting literature in economics that shows that productivity growth, overall growth, and an increased living standard all come mostly from capital investment. It is capital (as opposed to straight consumption of short-lived items like food and services) that funds the machinery, education, and training that continues to give back, year after year, productive services like roads, new inventions, manufacturing plants, and housing. We all know that the US has had a low rate of capital investment, which Albus contrasts with China's extraordinarily high rate, and thus high growth which is overtaking us.

Albus shows fanciful graphs going far into the future of the US maintaining a 9% economic growth rate, which would enable us to stay ahead of the Chinese indefinitely. The problem is that not all investment is productive. We learned from Japan that the dizzying rates of capital formation and investment in a developing economy that is committed to catching up with the first world do not last forever. As long as one is behind the technological frontier, productive investments are easy to find- just steal them from more advanced cultures. But once one reaches the technological frontier, the search is far more difficult. Much more investment is wasted in exploratory research, and it is less attractive to rip out current sunk investments to keep up with every tiny increment on the slowly advancing frontier. This explains why China's growth will inevitably slow, as did Japan's and ours.

This is not to say that we should not raise our capital investment rate, but that we need to be more judicious than simply shovelling more money into mutual funds. Since the value of the stock market is based on a relatively coherent estimation of future income flows to corporations, pouring in more money on behalf of passive small investors will mostly just nudge out other, more liquid, investors, keeping the overall level of investment stable (with the caveat that price/earnings ratios have indeed risen (perhaps doubled) over the last few decades as a larger pool of investors has flooded the market). This would be a good thing from an economic justice standpoint. One of the points of Albus's plans is to distribute capital ownership more widely, in preparation for the time when none have jobs, but all need income. But it is unlikely to raise net capital investment much or raise economic growth rates.

The ironic thing (given Albus's government career in the highest levels of its research enterprise) is that he is so focused, perhaps due to libertarian leanings, on pumping money into the private capital markets, that he neglects the real capital shortfall- that of public investment. It is now a common mantra that our infrastructure is crumbling, and that education is too expensive. Both are areas where government investment is the most productive way we have to build for future economic and social returns.

Otherwise, there are some positive aspects to these ideas. What goes unmentioned is that the personal investment scheme will have to be heavily controlled by the government, since most people getting that kind of money are going to spend it. That is why so many poor people exist, after all, and so few capitalists. And the inflation control scheme is also rather heavy-handed, if effective, though one has to ask where this savings would go so as to not be inflationary. Putting it into mutual funds would put it into the markets again, and thus be ultimately inflationary. It would probably have to go into newly issued government bonds, which is to say, into a money black hole.

But the idea of spreading around capital and its income stream is very interesting. It is a far better idea than a simple UBI, which is structured as a sort of pittance handed out to keep the jobless from gathering into mobs with pitchforks. As we enter an economic era where capital is ever more dominant, through its comprehensive ability to generate economic value with ever fewer workers, the whole economic system needs to be rethought, with an eye to the middle class, not just the homeless and jobless. We already have vast pension funds and mutual funds, which have spread around the income flows from capital, if not taken effective control of the system from capitalists of the traditional variety. We already tax income and capital gains and inheritances to divert some of those gains to the common good. More of that kind of redistribution, of both capital and its proceeds, needs to happen in order to achieve the economic justice and stable future that Albus seeks.

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Cells Put Their Best Face Outward

Structure and function of the flippase enzyme.

This dates me a little, but when I was in grad school, the fluid bilayer hypothesis of membrane lipids was still new and exciting. Now canonical, it proposed that cellular membranes have no more structure than a soap bubble, being flat fluids of phospholipids that self-organize into a bilayer with two leaflets, each leaflet keeping its polar or charged head groups out towards aqueous solution, and their lipid tails on the inside, facing the complementary leaflet. At our scale, it seems shockingly fragile and structure-less. But at the micro scale, it is a pretty tough affair. Typical membranes are about 5 nm thick, which seems negligible, but it takes a protein at least 7 alpha helical turns, or 25 amino acids, to span it. Given that the fatty tail length is freely adjustable, as is the chemical nature and charge of the head groups, evolution has evidently optimized the thickness of membranes to provide an optimal tradeoff of structure and lightness. They are tougher than they look.

In this microscopic technique, cells are frozen and cleaved sideways, causing some of the membranes to split along their inner leaflet boundaries. This highlights the proteins and other material embedded within them. Note at the top that a small portion of the plasma membrane of this cell has a quasi-crystalline raft of proteins- a sign of active signalling taking place.

Membranes are also chemically tough, impervious to charged molecules due to their fatty interior. These features made membranes incredibly successful- one of the key foundations of life. Eukaryotes developed a whole second frontier of membranes, as internal organelles like the nucleus, endoplasmic reticulum, golgi, lysozome, and mitochondria. Mitochondria particularly use the imperviousness of membranes to set up complex charge and chemical asymmetries, to serve as batteries, storing up electromotive force from respiration of food and using it to synthesize ATP.

But it turns out that there are some forms of structure amid all the fluidity of the fluid bilayer. There are the proteins, of course, which can organize into crystalline rafts, or hook onto cell walls (in plants and bacteria) or cytoskeletal supports to enforce overall cell shape. There are features of composition that can make membranes more stiff, such as using more rigid, more saturated lipid tails, or having more cholesterol, which serves as a plate-like stiffener. And it also turns out that the two sides of membranes can have markedly different compositions, another indication of just how stable and tough these tiny structures are.

A recent paper revealed the structure of an enzyme (flippase) that helps to enforce the asymmetry of composition between the inner and outer leaflets of eukaryotic plasma membranes. Why would such asymmetry exist? The reasons are not all clear, really. One aspect is the charge imbalance, whereby the inner (cytoplasmic) leaflet has more heavily charged phospholipids. There could also be defense issues, particularly among bacterial, which might want to present certain lipid head groups externally, and use other ones internally. Another is signaling, where certain phospholipids are chemically modified to serve as protein attachments and other forms of signaling, and thus need to be on the correct side of the wall. One prominent example is phosphotidylserine, which is usually kept on the inner leaflet. During cell suicide, (apoptosis), however, the (flippase) enzymes that keep it there are cleaved and disabled, while other enzymes (scramblases) that degrade the membrane composition asymmetry are activated, causing phosphatidylserine to be shown on the cell's outside, which is in turn a signal to traveling macrophages to attack and eat that cell.

So flippases spend their lives scavanging phophotidylserine from the outer membrane leaflet and transferring it to the interior leaflet, constituting one sign to the outside that yes, I am still alive. The process violates the concentration gradient of phosphatidylserine, so needs energy, which comes in as ATP. We end up with a rather complex two protein system that itself has to be consistently oriented the right way in the plasma membrane, cleaves ATP, phosphorylates itself briefly, grabs phosphatidylserine specifically from the outer leaflet of the membrane, and then transports it across to the inner membrane.

This schematic illustrates the enzymatic cycle. The phosphatidylserine to be transported is at bottom, in green, on the external face of the membrane. A complex ATP=>ADP cycle dramatically alters the shape of the top of the enzyme on the cytoplasmic face, which at the E2P step is propagated down to a gap which opens between the two proteins- the portions colored purple and beige, which are situated in the membrane. This lets a phosphatidylserine to slip into a pocket that binds it selectively, after which the phosphate leaves the upper part, the enzyme recloses, and the phosphatidylserine is released to the other face of the membrane.

This structure was arrived at with the new techniques of electron microscopy that have allowed protein structures to be determined without crystallization, a development that has been particularly beneficial for membrane proteins that tend to be very hard to crystallize. The project also used a series of ATP and phosphatidylserine analogs that helped freeze the proteins in certain conformations through the reaction cycle, providing the data that informs the model above.

A closeup of the phosphatidylserine binding site, the lipid tails pointing upward. Ther are numerous amino acid side chains from the protein (such as asparagine (N) 353, serine (S) 358, etc. that coordinate the phosphatidylserine specifically, making this a transporter almost exclusively for this phospholipid alone. Other hydrophobic side chains such as phenylalanine (F) 107 and 368 form congenial interactions with the lipid tails.

Binding of phosphatidylserine is specific, but it can not be very strong, since the point of the reaction cycle is to release it again rapidly. Once binding has established specificity, it induces dephosphorylation, which then induces further conformation changes that lock the outward access of the phospholipid and destabilize its binding to the protein.

A cross-section of the full structure (right), and schematic showing (left) the series of structural elements of the two proteins of the transporter (CDC50A, now called TMEM30A in red, and ATPA1, the ATPase, in all the other colors.) The full structure (with no phospholipid or ATP present) has the ATPase on a large domain sticking out into the cytoplasm, and the key phosphatidylserine binding cleft (between the purple and beige sections, buried in the membrane.

It is wonderful to live in an age when such secrets of life, once utterly unsuspected, and then veiled in unreachable technical obscurity, are revealed in mechanistic detail.

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• What is earth's carrying capacity?

Goal: One Billion

The Earth can't take 10 billion people. 

We have environmental and cultural problems at all scales, from the local to the global. From water shortages, drought, plastic pollution, overfishing, and species extinction, to global warming, authoritarianism, social fraying, anti-immigrant fervor, and gridlocked traffic and real estate markets. There is a common thread, which is that there are way too many people. We have (at least in some places) remediated some of the worst practices we used to take for granted, like killing whales for oil, using explosives for fishing, or dumping chemical wastes into rivers and soils. But there are are few practical ways to remediate our carbon emissions, water scarcity, or need for vast farmlands. We need to take a long look in the mirror and realize that the Earth can't take it, and we are the problem- the shear number of us.

Consider the range of problems like housing costs gone wild, traffic choked to a standstill, rising education costs and competition, and political gridlock. Are these related to overpopulation as well? I think very much so. Real estate is self-explanatory. As the old saying goes, they aren't making more land. Even while plenty of land is worthless, the need for people to live near other people means that we need to live together in what have become increasingly choked megalopolises. While rich metropolises like San Francisco and London struggle with traffic congestion and decaying public services, poorer ones like Lagos, Sao Paulo, and Mumbai had few services to start with and attract ever widening circles of destitute slums.

Lagos

A deeper issue is why our political systems are breaking down as well. Public services are decaying for a reason, which is that solidarity has weakened. Half of the US electorate has checked out of communal projects of good governance, rational and positive foreign policy, and caring for others. After two centuries of extraordinary growth, first sponsored especially in the US by a marvelously depopulated New World, and then again by bounding over technological frontiers such as fossil fuels, electricity, and the green revolution, we seem to have reached a general growth plateau, (barring development of robots who will do everything for us, but burn ever more fuel in doing so), and the expansive mood has ground to a halt. One consequence is that the elites of the culture, principally the rich, no longer subscribe to an egalitarian ethic. Growth can not be relied on to lift all boats, rather it is now every class for itself. Which class wins, when money runs politics and the media, and has been turned into "free speech" by the supreme court, is obvious.

It used to be, in the "population bomb" 1970's, that we thought that famine would be the limit on population. But it turns out that, given enough fossil fuel inputs for fertilizer production, machinery, and clearing new arable land, plus a green revolution in crop breeding, food is not the limiting factor. It is a thousand other things that we are doing to the biosphere and to our societies. The tide against immigrants is clearly borne of fear, that the number of the poor who want to flee their wretched conditions is essentially limitless, and thus that prosperous countries, i.e. Europe and the US, can not offer the relatively free immigration conditions they have heretofore. The US gained vast goodwill throughout the world over the last couple of centuries by admitting countless immigrants and playing a central role in many of the technological improvements that have allowed populations to grow everywhere.

But that process seems to have reached an end point. We have picked much of the low-hanging fruit, and have come up against insurmountable barriers. Fusion power has not happened. Space colonization is completely impractical. Even electricity storage is presenting tremendous difficulties, making a large scale switch to renewable electricity virtually impossible. And the biosphere is being degraded every day. We have come up against Malthusian limits that are more subtle than famine, but need to be heeded, lest we relentlessly immiserate ourselves.

There are two general political responses to all this. The Left response is to cooperate as best we can and tighten our belts to fit in a few billion more. Open borders, save the children, conserve water and reduce electricity usage, so that all can have at least a share of whatever resources are left. The Right response is to deny that there are significant ecological limits, cast whatever limits there are in economic terms and compete to take what we can while we can, and devil take the hindmost. Neither response is very forward-looking. One can make the argument that development is the only proven way to reduce demographic growth. Therefore, we should promote development, and bring everyone up to first world standards of resource consumption, which will in turn bring birth rates down to what in Europe and Japanare less than replacement rates. But the Earth can't take that policy either. Global heating is already having dire effects. The biosphere is already decimated and impoverished.

Thus we need an even more impractical, impolitic, and direct strategy, which is to aim to dramatically reduce the human population. A rigorously enforced one-child policy over three generations would get us from the current 7+ billion people to 1 billion, which, I think, given the current technological state, is reasonably sustainable. China did an amazing thing with its one-child policy, nipping in the bud its most significant problem- that of vastly too many people for its capabilities and resources. China is now reaping the rewards of that policy, though it hardly went far enough, and China remains heavily overpopulated and rapacious as it ascends the ladder of development.

If combating climate change is a problem from hell, structurally diffuse and resistant to responsible policy, then population control is far more so. National power is to a great extent dependent on economic and population size. We have for centuries had a mania for growth, embedded in every fiber of our economic policy and national outlook. We are Malthusian to the core, and our major religions are even worse offenders, propagating the most Darwinian of reproduction policies, even while they so ironically decry Darwin's intellectual bequests. No, it is not an easy problem. But at very least, we should not fear declining birth rates as some existential catastrophe and sign of general decline. No, they should be welcomed as the least we can do, and a small part of our path to a sustainable future, for ourselves and for the biosphere that is our home.

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• Bonus quote of the week, from "If We Can Keep It", by Michael Tomask.

We are in trouble. Our political culture is broken, but it is not broken for the reasons you often read that it's broken- because Washington is 'dysfunctional' or because politicians have no 'will'. No. It's broken because some people broke it. It was broken by the people who pushed the economic theory on the rest of us that has driven trillions of dollars that were once in middle-class people's pockets to the comparative few at the very top. Who refused to invest in the country anymore. Who will not even negotiate real investment. Who have been telling us for years that the market will take care of all our needs, while the market has in fact left thousands of towns and communities strafed and full of people addicted to drugs- the drugs, by the way, tht the same free market is pumping out in vastly greater quantities, and for vastly greater profits, than it did twenty years ago. And who have built up a parallel media universe in which any of these commonsense assertions are dismissed as socialist, and in which anyone who doesn't endorse the thesis of Donald Trump's greatness is denounced as un-American. 

They broke it. They broke it to gain power and to remake society in a way that was less communitarian, explicitly less equal, than the society we were building from 1945 to 1980. And- let me not forget this part- less democratic. I wrote earlier of Donald Trump's contempt for our institutions, our processes, put another way, for the democratic allocation of power. Many observers (me included, sometimes) have wondered why this didn't make Republicans recoil. The typical explanation has to do with fear of his base, but I've come to believe that the simplest explanation is the best: They didn't recoil because they're not especially bothered. They find him embarrassing at times, and they disagree with him here and there, but his demagogic approach doesn't really trouble them on the whole. They- not all of them, but certainly a critical mass of elected officials, operatives, and billionaires- no longer want to compete with and merely defeat liberalism on a level democratic playing field. They want to destroy it. This is why they do things like aggressive gerrymandering, the voter suppression laws, the attemt to change the way we elect senators, the blocking of Merrick Garland- all of which preceded Trump. They want to change the rules so they they never lose. And if destroying liberalism requires breaking the system- as it surely does- then so be it as far as they're concerned.

Altruism Through Execution

Does our good behavior arise from artificial selection against norm-violators?

This is a companion piece to the prior "Altruism Through Genocide", which presented a group selection theory for our human moral nature. In that piece, group cohesiveness was the driving force that benefitted those cooperative people who could effectively conduct warfare to exterminate their enemies, who were, on balance, less effective in their in-group altruism/cooperation.

Now we are considering a new book, "The Goodness Paradox", by Richard Wrangham, which presents an alternative, only slightly less grisly, theory. The book generally argues that humans show many signs of selective domestication- a syndrome common in animals that we have domesticated- of arrest in many aspects of development, towards more juvenile characteristics, such as docility, lower aggression, floppy ears, white fur patches, and skeletal and especially facial juvenilization. That much is clear. Despite our love of warfare, we are on balance, and compared to our chimpanzee relatives and most other wild creatures, far less violent, less reactive, and far more effectively cooperative. This is not just a cognitive development, but an emotional change and a deep change to our moral natures. So who or what did the domestication?

Remember in Western movies how good it feels when the bad guy gets killled? It is an archetype of deep power, and we hardly think about its moral and genetic implications. Chimpanzees don't have this moral sense, as far as we know. Wrangham cites various experiments and natural observations to show that no matter how terrible some chimpanzees are, the others of their group will not or can not cooperate effectively to ostracize or disable them. It just isn't done. In the modern world, we have grown squeemish about capital punishment, but primitive cultures had no prisons, thus pervasively practiced ostracism or death as the only practical punishments for serious crimes and unredeemable people. It turns out to have been common for communities (typically the men of the group) to gang up on a member who got egregiously out of line and kill that person. Wrangham places this development at roughly the emergence of modern Homo sapiens, two to three hundred thousand years ago. Thus there is quite a bit of speculation about the relative backwardness of Neanderthals, who had much more limited cooperative capacities, though being roughly as intelligent as moderns, and having many advanced characteristics such as complex stone technology and control of fire.

For a Few Dollars More ... Clint Eastwood hunts down the bad men.

The development of advanced hunting and killing technologies made each person, and especially each man, in primitive human bands quite powerful. But even more important was language and great scope it offered to organize, to collude with and against others, This created enormous incentives to maintain a good reputation. Primitive societies are characterized by an almost pathological fear of rising above one's peers- there is a notable lack of ambition, for the very good reason that the group is all-powerful, and signs that one wants to rule others, abuse them, or collude against them, are all treated very harshly. The idea, then, is that the unique human ability and motivation to detect and eliminate threats inside the group led to a process of natural selection that quickly domesticated the species in superficial metrics of reactive aggression, while advancing our organizational, deceptive, and language capabilities, which have made us by far the most deadly species when it comes to organized hunting and warfare.

The explains rather easily the intense motivation that teens have to conform to their groups, to party, to bond and seek power, and to be forever uncertain about their status. It explains conventionality. But does it explain the nature of the morality that human groups generally express? The posses that hunt down criminals, and the modern state apparatus that does the same on a more legalistic basis, the value we put on altruism and kindness? Not quite. For example, the morality could have become one of extermination, where leaders would use all their guile to eliminate, one by one, each of the other males of the group, thus gaining all the females for themselves. This harem structure is common among other animals, and has occurred occasionally in humans in historical times. But it has obvious defects. If such an endpoint is common knowledge, then coalitions would be difficult to build, though perhaps not necessary since even crude technologies allow relatively easy killing, even one-on-one, given a small amount of planning. More importantly, however, such an endpoint would leave the group very weak relative to other groups.

So both overall hypotheses are relevant, I think, the group selection hypothesis and the execution hypothesis, to explain the complexity and explosiveness of our group relations, and the generally pro-social and cooperative instincts that form our group values most of the time. There is a complex calculation to be made, in light of the status of the whole group, with regard to the value of each person, each one of whom would on the face of it benefit the group in any outward encounter, but who might also be so disruptive and destructive of group cohesion as to instead be a net negative asset. Wrangham unfortunately finesses this problem, of the actual content of our moral group ethics, and suggests instead that pure relativism prevails- that our groupishness / conformity / docility is genetic, but our morals are not, and become whatever the leading (male) coalition says they should be. One can grant that human groups have adopted very unusual moral codes, like sacrificing their own children into volcanoes, or conducting constant ritual slaughter as the Aztecs did, or making a fetish of celibacy, as the Buddhist and Catholic theocracies do. Nevertheless, there is a core of cooperativity and deep-seated conceptions of right and wrong (including the rightness of killing when the target is damaging the group, or is an enemy outside the group) that demand a better evolutionary explanation, one that focuses on the value of the group as a unit.

Wrangham also finesses another issue- that of eugenics. His theory is essentially eugenic. We have been our own selective agents, however unintentionally. In an afterword, he gives a brief case against capital punishment. Though it has had such positive effects by his theory, capital punishment is now unnecessary, since we have prisons and other mechanisms of social control. Yet the deeper issue is whether genetic selection is still needed to bias reproduction towards the well-behaved and away from the aggressive, psychopathic, misogynistic, and congenitally sleazy. Not a word on this, since it is a far more explosive and difficult issue, not to mention politically tinged at the moment.

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