Mind of matter

I propose a tentative model of qualia and consciousness.

A rich thread of comments over at another blog motivated me to tackle the problem of consciousness with as much specificity as evidence currently allows, including the voluminous evidence for its material basis. So here I try to lay out a plausible model of fully brain-based consciousness, to address the dualist, who typically says that he or she can not imagine any material basis to consciousness, and even claims that there is some kind of philosophical necessity that the "hard problem" of consciousness is beyond scientific analysis entirely. (I have previously written about the neurobiology of consciousness, which remains unresolved.)

As a philosophical naturalist, I would predict that no new physics will be required to resolve the consciousness problem (such as 5th dimensions, quantum consciousness in microtubules, etc.). It is pretty clear that the brain is a messy product of evolution and works by electrochemical / molecular mechanisms. It is encoded by DNA, bounded by physical space (the head), and is affected at all levels by known lesions, chemicals and other effects. Nothing more esoteric is likely to show up in its study, other than incredibly intricate organization, which we still have great difficulty analyzing as a purely technical matter.

That leaves us with either an identity position that dualists don't seem to understand, (that there exists some brain-based processes that are objective physical events and also constitute subjective consciousness at the same time), or an eliminativist position, which we all dislike (that consciousness doesn't really exist). The problem may go away, but surely not by claiming that we have no consciousness after all. Indeed, the fact that there are unconscious processes that include forms of perception, intuition, and many other computations means that there is some real distinction between things that are unconscious and those that enter consciousness, and thus that consciousness is not an epiphenomenon or semantic issue.

So I should explain the identity position a bit better, despite the admitted lack of a real scientific solution in place.

Everyone has heard about continuity in movies- the need to keep hairstyles constant, props in the same places, etc. even when a shoot of one scene goes over several days, so that the illusion of continuity is preserved. I think this is a big clue to consciousness, which could be thought of as consisting, in part, of a brief memory loop that keeps our experience continuous. The ability to associate a split-second ago with now gives us not only a sense of time, but of consciousness itself, since otherwise we would be bombarded by what seem random stimuli, uncontrolled, uncorrelated, and meaningless.

So that is part of the answer, which can be easily imagined to be embodied by the gamma wave system in the brain that is the humming in-phase communication of ever-changing coalitions of neurons from all over. This would be the perfect system to glue together percepts and mental contents while giving them limited continuity of a fraction of a second, some of which is then stored to short-term memory, which is so notoriously poor, (hippocampus), some of which is stored in turn to longer-term memory (frontal cortex). Recalling something from memory weakly re-creates the engram (gamma pattern) that was originally driven by the perceptual system, and engages the same consciousness system, though with much lower intensity and different feel. We need a prompt like a smell or madelaine to assemble the engram again more fully, though it is never again quite the same as the first time in any case.

But we still have not gotten to the heart of the issue- the redness of red. We know that lesions like strokes can cancel out perceptions very selectively. There was a recent New Yorker article on the inability to read words while having unimpaired vision- an amazingly specific stroke effect. But the funny thing is that the sufferers routinely have to deduce their deficits. If something is missing, even something like half the visual field, we are not notified. The consciousness system soldiers on as though nothing has happened, forming an impression of the world that feels complete out of all the remaining bits and pieces.

Thus consciousness is very grade-able, both among humans with various talents and deficits, and among animals with different senses and brain sizes, as well as within one person in different moods, states of sleep, Dilbertian meetings, etc. It is also the kind of system that presents whatever comes up and doesn't care about what is missing. This again fits the gamma wave system, which wouldn't join up nerves that were not firing, but would just assemble whatever forms a minimal coalition of activity. And lastly, I'll make a stop at synesthesia, where one sensory modality bleeds into another, for instance inducing people to perceive certain numbers as having particular colors wherever they appear. The cause seems to be a literal mixing of neurons in relevant areas of the brain, which has obvious selective implications, both for problems arising from extensive wrong-wiring, and for the possible creativity and special perceptual powers that might result from limited cross-wiring.

What is red? Remember that red is a complete fabrication- our brain's way of mapping qualia to what in physics are numerically different wavelengths of light. The brain can apparently make anything it likes of the stimuli coming in. We should not be surprised if bats see their sonar world in living color as well. The question is why red feels so immediate, and what transaction actually occurs between red and "our perception" of it. In other words, what is the difference between unconscious and conscious information processing?

The difference seems to lie in entry into a privileged process in the brain, such as perhaps the gamma wave system. Other areas of the brain may talk to each other and process information, but that does not enter consciousness. Whatever does enter consciousness comes from relatively high level areas of processing, by virtue of the brain's wiring, which mostly flows from inputs (signals from the eye) to higher levels of processing that are biased towards participating in these gamma wave coalitions (analyses of shape, object identity, face identity, motion, etc.). Some people such as artists may able to "see" a scene without a lot of computational processing and overlaid interpretation, but as it is at a more basic sensory level, implying that they have conscious access to unusual levels of processing.

So consciousness is a part of a unique level of processing, where interpretations are collected and cross-correlated and learned from. Why does that feel real as unconscious processing clearly does not? Incidentally, unconscious processing may be just as complex, as we learn from our social intuitions, which can be incredibly spot-on and discerning about situations we have given little conscious thought to. Dreams also point to enormous depth and richness to unconscious processes, so it may be a mistake to put all this in some kind of higher/lower hierarchy.

A sense of reality may in this theory be the product of pure associational power- the construction of a sufficiently complex and rapidly integrated virtual world becomes what we call consciousness. If everything we see instantly generates a map of spatial, social, artistic, analytical, and other associations, that alone gives the scene "reality", immediacy, and red-ness. Seeing red becomes conscious not through some magical or impossibly recurrent homunculus behind our eyes, but by its particularity in contrast to other sensations and its web of immediate associations with the vast arrays of implicit and explicit knowledge we carry around in the database of our heads.

Suppose you were to see a uniform field of red all the time, day in and day out. You would no longer be conscious of red at all. You would not only be seeing the world through rose-colored glasses, but be seeing only the rose colored glasses and nothing else. Had you no other senses, you would probably lose consciousness altogether, a sensory-deprived victim of extreme torture. But of course we have many other senses- sound, smell, touch, and several newly discovered ones, such as body and spatial sense and the like. We also have dreams- the ability to draw on our voluminous past sensory impressions and their plastic re-arrangements in imagination. So it is literally impossible to do this kind of experiment.

This theory can account for the graded-ness of consciousness, its natural development through evolution, its materiality, and in addition provides a program for the instantiation of such experiences in artificial systems. It informs the common observation that high-level consciousness is dependent on knowledge, such that the study of art history gives us new eyes in museums, and the study of biology gives us new eyes in nature. It also provides a program for the study of consciousness, since its physical correlate should be quite discrete and find-able (by the identity theory mentioned above). It is in the correlation of subjective consciousness to this postulated physical correlate that the test will be found, either confirming detailed correspondence, and driving other theories to extinction, or not.

Lastly is the issue of emotion and pain. The above theory deals with cognitive consciousness, like *appreciating what red is in an immediate way. Emotions are simpler, not necessarily association-based. They are prior to high-level cognition. Past pain is certainly a strong spur to current aversion by association, but how did past pain happen? How was it perceived? There is something elemental and not associative about raw emotions like pain, which form perhaps our first and most traumatic form of consciousness.

Pain can function without consciousness at all. We typically notice that we have pulled our hand from the fire after the deed is done, and wonder at the reflex. But pain can also flood consciousness, issuing its imperative command to fix whatever is wrong. Similarly, other emotions typically operate below consciousness, to the point that our partners are often more familiar with our tics, mannerisms, and broadcast emotions than we ourselves are. As above, the cognitive contents of emotions can be characterized as associative, (what hurts, who did it to us, what is causing pleasure, etc.), but emotions carry extra contents injected alongside as the valence of the pleasure or pain- the command by other systems of the brain that this is something to be done again, or never again.

So it is no surprise that consciousness seems to be a complicated system, requiring rapid and  wide-spread associations to provide the brute contents and textured differentiation of cognition, as well as a brief memory loop that gives continuity to experience. Emotions are injected as extra cognitive contents and feelings, using specially responsive brain areas that date from early evolution and provide more than information: motivation.

I have tried to present a model that is plausible given current evidence, though obviously not very detailed. While there is plenty of circumstantial evidence that something material and eletrochemical in the brain is responsible, it will take a few decades yet to fill in those details.

• Theologians working at public universities find it getting hot under the collar.
• Can you lose your sense of smell? 
• A billion dollars here, a billion dollars there...
• One gets the impression that Hamid Karzai doesn't know much about power.
• Though his isn't the only government beset with unaccountable bloat and corruption.
• An interesting reflection on the worth of work:

".. while collecting salaries of between £500,000 and £10 million, leading City bankers destroy £7 of social value for every pound in value they generate." ... ".. for every £1 they are paid, childcare workers generate between £7 and £9.50 worth of benefits to society."

• The financial industry needs a transaction tax.
• Wear a Pink Sari and Carry a Big Stick.

Go, LeBron!

LeBron James knows what business he's in.

Sorry to stray from my usual dour topics, but the recent LeBron James saga has thrown some interesting light on labor in America. Commentators have been piling on about his narcissism, his breathtaking gall, his callous rending of Cleveland's heart, and the botched PR that will see him rot in hell. Or something like that.

Topping it all was the Cavalier's owner, who threw a titanic snit at losing James to Miami and apparently learning about it on TV along with the rest of us. To which I say, tough luck!

James put the NBA owners through their paces, subjecting them to the most abject groveling, before arranging a prime time extravaganza to burn his bridges to all but one. Where else have we seen a powerful and energetic black man, sometimes referred to as "the one", calling the shots? Firing generals? Showing the man who's boss? Being the man?

So let us not cry for the NBA owners, with their anti-trust exemption. Through their ministrations, the NBA has far more teams than talent. Way too many games are scheduled and as a result, injuries are rampant. The game has become relentlessly physical and combative under NBA refereeing. In Cleveland, James was expected to carry the team mostly by himself, and was unable to make it work. In desperation, they imported Shaquille O'Neal, creating a situation more comical than effective. James did the rational thing and created a better situation for himself elsewhere. All NBA teams try to nurture and milk home-town sentiments ... until they don't, trading players as though they were slaves on the auction block. It was nice to see the tables turned for a change, frankly.

The way I see it, James's primary motivation was to play with his friends and fellow stars, Wade and Bosh. And these are very honorable motives. The US army relies first and foremost on comraderie to build units that fight effectively. This seems lost on the modern NBA, where players are shuffled around on the basis of little more than management hunches, statistics, and needed positions. My local team, the Warriors, has seen season after season end up high in the draft due to terrible chemistry, starting from its top management. One player went so far as to physically choke the coach. Thankfully, both are retired now and resting peacefully. Conversely, the Boston Celtics assembled a star threesome several years ago of Paul Pierce, Ray Allan, and Kevin Garnett, which worked on the levels of both chemistry and talent, to ensuing acclaim. Few thought that Garnett should have slaved on in Minnesota to the end of his career.

In this way star players are taking control of their careers, and in turn, of the league, typically not to make more money, but to play with colleagues they like, and thence to be successful on premier teams- teams that the NBA is structured by its owners to avoid, based on its collusive drafting and salary cap rules. The owner-player tension is evident, and we shouldn't mind the ball going into the player's basket every so often through canny self-promotion and sheer talent.

Lastly, why do it on TV? Wasn't that shockingly self-aggrandizing? Well, the high ratings speak for themselves. If nine million people watch, then it is by definition not self-aggrandizing, it is entertainment, which is, after all, the business the NBA is in. To which, I say, well done, LeBron!

• More on LeBron.
• Crazy capitalists! Runaway monkeys! 
• Let's support congressional action on climate and energy.
• One more point in the deflation vortex. And the Fed isn't helping, either.
• What is supernaturalism and naturalism, anyhow?
• Luttwak disabuses us of faith in the Afghan government. And adds: "Give war a chance."!
• More on the merchants of doubt.
• Lesbian mice? Oh dear!
• A fool in Afghanistan.
• The trouble with torture is ... the media attention.

Kant and the cognitive bootstrapping problem

It turns out that our brains come pre-patterned to deal with space, time, causality, language, and morality, among other a priori concepts. Where did they get them? From evolution, of course.

Respect for dead philosophers is an odd thing. They are often revered for introducing ambitious systems of esoteric metaphysics. Occasionally for having novel ideas. Sometimes they even write well. The questions they raise are perennial and to some, fascinating. But rarely have they solved anything. Ambitious systems are propounded in one era only to be forgotten or overturned in the next, at best remembered by a catchphrase, like "God is dead", or "thesis, antithesis, synthesis". It may be a brutal disservice to the history of ideas to encapsulate the multi-volume cogitations of past philosophers in such token fashion. But unless they have supplied solutions to some of the perplexities of existence, what else can we in all honesty do?

Immanuel Kant grappled with our capacity to reason, among much else. He realized (as prodded by Hume) that experience alone was not enough, combined with reason, to organize our thoughts about the world. We need to have some pre-existing template into which to pour all those experiences, like a basic grid of space, time, and a sense of causality, if we are to have any hope of getting off the ground. Which is to say- our minds can not be an empty slates if we want to learn anything. Or to put it another way, we can not epistemically pull ourselves up by our own bootstraps. Thus he came up with a priori concepts, which he took to be given structures of the mind, however the mind comes to be.

From the wiki pages: "... Kant is thought to argue that our representation of space and time as a priori intuitions entails that space and time are transcendentally ideal." ... "According to Kant, a priori knowledge is transcendental, or based on the form of all possible experience, while a posteriori knowledge is empirical, based on the content of experience." ... "Something is transcendental if it plays a role in the way in which the mind "constitutes" objects and makes it possible for us to experience them as objects in the first place."

Despite Kant's other ventures in defense of god and of free will, this aspect of his ideas did not neccessitate any opinion on how the structure of our minds arises, and is thus quite consistent with modern cognitive psychology and developmental psychology.

Two recent papers deal with development of spatial consciousness in rats. Incidentally, another recent paper shows that this system (spatial representation and memory across the entorhinal cortex and hippocampus) which is so well studied in rodents, works the same way in humans, studied by way of strokes that create transient dead spots in the hippocampus. The rat papers study very young rats, just as their eyes have opened and they have their first exploratory experience outside the nest, to tell whether their hippocampal and entorhinal place memory/sensing systems are already in place, or only form later after further experience. Their conclusions agree that, while experience helps this system grow both physiologically and in behavioral accuracy, it is in place from the earliest times.

The hippocampus is the location for storing temporary memories, and also for place memory. It is telling that a popular memorization trick among the ancients was to vizualize a palace with endless rooms, where arbitrary memories are stowed by location, available for retrieval later. In the contemporary world, graphical metaphors lead the way in computer user interfaces, giving us "windows" on virtual spaces that organize our affairs far more richly and naturally than text indexes, file trees, or other more easily-implemented methods.

The hippocampus gets its location input from the entorhinal cortex, which is in turn connected to the inner ear, vision, and other sensory systems. The entorhinal cortex contains neurons that respond to head orientation, spatial grid at various scales, borders, and absolute location. This means that scientists have been able to record the activities of neurons that fire only when the rat faces a particular direction relative to its environment, or crosses an imaginary line in an arbitrary polygonal grid that divides up its environment, nears a spatial border, or hits a particular location or landmark.

These cells are assumed to be directly involved in the animal's consciousness of place, since their removal dramatically impairs their ability to learn mazes and know where they are. The question then is... when is all this information set up? We know that learning creates new grids, landmarks, and borders all the time. But is there anything in this system at the start, as neurons get wired up? These papers claim that yes, there is.

They inserted electrodes into the relevant location of 16 day-old rat pups, and found that already at this time, two days after their eyes have opened, and before significant mobility, they have head direction cells and place cells, and one paper finds grid cells as well at this early time.

Example from Langston, et al. showing the location of probes in the entorhinal cortex (A), and local neural firing rates (with peak firing frequency noted) of presumptive head-direction cell recordings, plotted vs actual head direction (B).

Unfortunately, for all the technical pain of doing this kind of work on such young animals (for all concerned!), I don't think they did this early enough. Even with their eyes closed, infant rats are probably acutely aware of place, if only to find the mother's nipple. Vision is not the only input to the entorhinal cortex, so doing this work soon after the eyes open seems insufficient to say that the overall space orientation system is in some part natively present by genetically-driven development alone. Indeed, even in the womb, babies probably have some notion of space, since they are kicking around and active.

As Langston et al. conclude, "Whether the formation of prototypical representations in the parahippocampal and hippocampal cortices requires translational or vestibular experience at younger ages, in the next, remains to be determined."

So the ideal experiment would seem virtually impossible to do- to isolate a developing rat's entorhinal cortex (and thus hippocampus) from external influence to see what the brain wires up all by itself. This could be done by severing the inputs in such a way that they could not regrow. Which would probably derange its development substantially, by cutting off the nerves invading from the sensory areas. Would that tell us that modest inputs from very early times may have strong influences on the nascent wiring? The hard part would be to measure the naive neuronal maps- if they have no input, then how can we measure them? How can a grid cell fire if the rat can't detect a grid? At that point, we might have to resort to dreams as a way of probing the native capabilities of the brain. Could a rat with no spatial experience or sensation still have spatial dreams? Now that would be an interesting question!

In the end, this work seems at best indicative of the conclusions they claim. I would generally agree that the Kantian a priori concepts of space and much else are pre-wired in the brain in some way, based in turn on the evolutionary patrimony of embodied knowledge gained through the school of hard knocks. But the very concept of brain "wiring" is transgressive, both carrying information and constituting information derived from past development and genetic influences. Mammalian fetuses experience things from some early point in time, based to various degrees on genetic wiring. From there on, development is a mad dash of experience and genetic patterning each feeding off the other to generate that mighty device- the fully formed brain.

I realize that this work does not even try to address the a priori concepts of morality, time (also here), social relations, language, etc. I believe they follow the same pattern of modest pre-patterning combined with intertwined experiential development, which the interested reader may wish to study.

• Corruption rampant in the oil industry, with taxpayers on the hook.
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• On the internet, no one knows you're a stutterer. That is, until you podcast!
• Tom Tomorrow draws a few crocodile tears.
• Enlightenement, shmenlightenment, Texas style.
• The media likes to be "balanced", except when it doesn't.
• Bill Mitchell quote of the week: He advocates that the government directly employ excess (unemployed) labor at a sustainable minimum wage, rather than acceding to the business practice of casting them out onto the street.

"Given the overwhelming central bank focus on price stability, and the critical role of today’s buffer stocks of unemployed, we argue that functioning and effectiveness of the buffer stock is critical to its function as a price anchor.

Condition and liquidity are the keys. Just as soggy rotting wool is useless in a wool price stabilisation scheme, labour resources should be nurtured as human capital constitutes the essential investment in future growth and prosperity. There is overwhelming evidence that long-term unemployment generates costs far in excess of the lost output that is sacrificed every day the economy is away from full employment.

It is clear that the more employable are the unemployed the better the price anchor will function. The government has the power to ensure a high quality price anchor is in place and that continuous involvement in paid-work provides returns in the form of improved physical and mental health, more stable labour market behaviour, reduced burdens on the criminal justice system, more coherent family histories and useful output, if well managed."

Apocalypse now

Biodiversity is going downward fast. What are we going to do about it?

Now that the climate change policy is limping forward again after some media outlets retracted their criminally lazy and uninformed coverage far too late to do anyone any good. Now that international scientific work of the IPCC has been validated and cleared all over again in all its essentials ... perhaps we can get down to where we should have been a decade ago- addressing our fossil carbon addiction and its planet-wide perils.

Another international consortium got together (pursuant to a 2002 Convention on Biological Diversity) to publish a paper on the state of worldwide biodiversity, and the news is not good. Human pressure on environments is going up, biodiversity is going down, and human conservation responses, though significant, are not sufficient to alter the trend. Here is the summary figure:

The state (of biodiversity) graph may not seem so terrible, with declines in our lifetimes (since 1970) of about 18% in aggregate over all the dimensions (many studies, over 5,000 populations) the group measures. But zero on this graph is really zero- no biodiversity. One species: humans. That is not a happy thought to contemplate. I can not really comment on their other axes, but their aim is to present trends happening over the last forty years as holistically and globally as possible. 

For one component ....

"The index was calculated using time-series data on 7190 populations of 2301 species of mammal, bird, reptile, amphibian and fish from around the globe."

One would have to note that the effect of humans on the environment hardly started forty years ago, either. Many of the most famous extinctions happened long before, such as the Dodo, the passenger pigeon, Stellar's sea cow, and on back to the extraordinary megafauna of pre-human North America.

Here are some more detailed components that are worrisome:

For me, biodiversity is the core issue with climate change and all the other harms we are doing to the biosphere. If the sea rises and cities are swamped, we can move and rebuild. But when species go extinct, that is pretty much forever. With DNA technology we may eventually be able to bring species back in some form, but what, frankly, would be the point? Without rich ecosystems, they would be just as stranded as before. Whether the atmosphere and rocks heat up is of no concern. But the fate of life on the planet- that is of great concern.

The root cause of this decline is obviously human overpopulation multiplied by economic development, integrated over lack of insight, foresight, and moral responsibility. Our powers as humans have become vast, and unexpectedly we have come up against ecological limits and harms that tax our powers of conception. That is why scientists have been in the lead sounding the alarm bells- they both love nature intensely, and have the capacity and tools to conceive of what is going on. 

But no one individually can divert this train to tragedy. We have to take collective action to avert collective disaster. What we do collectively is a moral question- do we sacrifice today (carbon tax, larger wild land reserves, a ban on ocean fishing, birth control) so that we and future humans (not to mention other creatures) can exist in a more harmonious and beautiful world?

• Roger Ebert's vocation.
• Nation-building works in Palestine, too.
• Can we reclaim our freedom and dignity yet?
• Building the urban bikeway.
• Reform, schmeform, financial-wise. 
• And macro-economic policy direction? Just getting worse and worse.

Indeed, just to give an idea of the scale of the current downturn, this is the overall employment level since 1950, courtesy of BLS:

There have been pauses in employment growth over this time, but never the kind of course reversal we saw over the last few years. Note that this data is more informative than "unemployment", which ignores anyone discouraged enough to not be looking for work, and many other questionable corrections. And here is a ratio of employment to population. Note that the current level has declined to near the 1950's to 1970's levels, when the proportion of women employed was much lower than today. 

We are Afghanistan

The troubles of forging unity from tribalism and chaos are universal.

With support for the nation-building effort in Afghanistan waning, it seems timely to discuss how common its lessons are for societies around the world. Afghanistan has never had a strong central state, unlike, say, Iraq or the US. As we in the US rush headlong into an always-on, utterly connected, everyone talking to everyone else world, we have left the insular tribal worlds of our own forebears far behind. Even the Germanic tribes of pre-Roman Europe seem to have been more organized and cosmopolitan than what we are facing in Afghanistan.

On the other hand, the perennial pull of state's rights here at home, the nihilism of modern Republicanism, and insurgent subcultures like urban gangs, remind us that state legitimacy is not secure even in the most "advanced" cultures- it has to be earned perpetually. And overarching all these organizations is the international political system, which remains dedicated to an anarchic individualism reminiscent of the Germany of Luther's time, or before.

So what will it take to glue Afghanistan back together, and what lessons can be taken to or applied from elsewhere? I'll start in my backyard. One blight of urban life is gang tags, which are applied dog-like to territories to proclaim gang "ownership", a form of sovereignty among gangs, or in extreme situations, over everyone else in the territory as well, as we see in Brazil's favelas and Mexico's cartel-owned cities and provinces.

Erasing such tags is part of a "broken windows" strategy to assert the legitimacy of a community's silent majority over the vandalizing minority who by their "ownership" signs try to assert political hegemony. The lesson is at once extremely simple and complex- that whoever controls the local infrastructure and public spaces gains social power. If we concede our public spaces to corporations in the form of billboards, we give them dominant legitimacy. If we concede our public spaces to gangs, we give them legitimacy, first to tag and counter-tag territories in never-ending internecine battles, and then, if we are sufficiently negligent, legitimacy over other aspects of our lives, like parking lot security, small business security and shakedowns, and eventually coercive power over the entire local political system.

What's the lesson? An obvious one is to know what is going on in order to know how to wield power. We have to know what is going on with gangs in order to realize that their tags are not gifts of public art, but adversarial political statements. We need to know the real power structures on the ground in order to break them and replace them with more broadly legitimate structures. Likewise in Afghanistan, we need to know the social / political setting in order to know the signs they produce. Schools for girls may make *us happy, but they might be threatening to a hide-bound traditional culture. While rebuilding Afghanistan requires some degree of cultural change on its part, we'll have more success the less such change we demand. I'm no expert, only commenting on the need to know what we are doing before trying to rebuild a nation, rather than reading the lessons of failure afterwards.

A second lesson is that the (silent) majority needs an active voice if it is to drown out the vocal, even armed minorities vying for political control, including whatever elite class currently holds power. Such majorities are easily cowed by armed coercion, so it can be tricky to know their true attitude, especially in a canny and beaten-down culture like Afghanistan. The Afghan tradition of elder conclaves remains one of the bulwarks of civil political dialog, and needs to be fostered throughout the system, especially at the grass roots. More generally, such a voice requires media that discuss and bring to light gang/Taliban activities, corruption, cultural ideals, etc. And it requires official channels that control coercive power, are responsive to community needs, effective in addressing them, (such as apprehending gang members), and free of corruption that impairs each of the foregoing elements.

Afghanistan is sadly far away from each of these elements- militias roam the country, the Afghan army has little loyalty or competence, the government is breathtakingly corrupt, the population is largely illiterate, and the stolen presidential election indicates a certain lack of responsiveness to the populace. Where will all this end? The situation is not lost, but without more trust and organization among the anti-Taliban, pro-democracy and pro-state elements, our role is futile.

One critical angle is the nature of central government in Afghanistan. With artificial borders, impassable terrain, and multiple quasi-independent ethnic groups, central governments have never been very strong even when they have been brutally tyrannical. Yet empowering the presumed silent majority of Afghanistan (including women) over the various gangs either allied with or part of the Taliban requires that the state have quite a bit of countervailing power- power that needs be legitimate in that majority's eyes if it is to be effective in the long run. That is the basic trick- how to draw the allegiance of the people (who may or may not have voted for the government) to its use of power over Talibs and other fanatics whether religious, mercenary, or the usual mixture thereof.

The alternative model is one of decentralization, where the parts of Afghanistan go their own way under token sovereignty in Kabul. In the absence of external threats, this would be quite attractive, but it lays the country wide open to divide-and-conquer by the Taliban and its ISI/Al Qaeda allies. That is the threat that necessitates our involvement and in the long run necessitates a strong central state, however novel the idea is for Afghanistan. One way to help this along would be to put the tribal areas of Pakistan on the table- to start discussing the idea that there is a cost to Pakistan for destabilizing Afghanistan, and that cost is US and international support for transferring the "tribal areas" that Pakistan has never shown much constructive interest in to their more natural home in Afghanistan, forming a more unified Pashtun region.

(Incidentally, the firing of General McCrystal puts another interesting light on the universality of these state power issues. It would not serve America well to put its own constitution in danger for the sake of more effective Afghan rebuilding. Seen from the perspective of ancient Rome, we are already in mortal danger by having standing armies, paying them as mercenaries rather than drafting them from the eligible population, paying various proxies to fight for us, sending them off to countless far-away wars and garrisons with little end in sight, and having a sclerotic and corrupted Senate virtually unable to serve the public interest. The last thing we need is military insubordination that brings ultimate civilian control into question.)

This brings me to the international system- another political system with some need of integration and federalization. Right now, nations exist in a largely lawless domain where armed states and non-states compete for shifting alliances either trying to gain legitimacy in the eyes of some audience, or trying to exert direct power over or under the table. The powerful bully the weak, and chaos is held at bay largely through the good (or not so good, depending on your perspective) offices of Pax Americana.

Al Qaeda has shown the power of PR over mere bombs and aircraft carriers. Their message continues to corrode the status/legitimacy of the US in the Muslim world. This is doubly remarkable because their own brutality hardly renders them attractive, as might be, say, the far more justified plight of the Tibetan people under the Dalai Lama.

Having a more organized and democratic international system (i.e. a world government) would be very helpful to address such issues of common concern, like the lawless fishing of the seas, pollution, and climate change. Perhaps the greatest need, however, is to set a floor of minimal standards of local governance, monitoring failed states before they became festering international sores and taking a systematic, organized response that is stronger than the shrugging and flaccid UN ministrations they are met with today. With respect to Al Qaeda, a coherent world government would be much more likely to treat such irritants as policing and governance issues rather than some kind of clash of civilizations / war on terror, etc. The US didn't have an international structure to turn to, forcing it to "go it alone" with all the problems attendant to such foreign adventures.

Afghanistan is a model of state failure, suffering decades of civil war capped by the brutally benighted government of the Taliban. The international system as sponsored by the US is not in quite such a chaotic state, after the last century gave us such cautionary lessons. But the US will not always be the global superpower, nor is it universally appreciated in that position. So it would be wise to build international institutions, as we are building national Afghan institutions, that can further the peaceful interests of humanity in an effective way.

• Friedman is pretty down on Afghanistan. But how can our work there not "resonate" if it has world-wide importance?
• Know thy parents.
• Why are we failing? Because markets are not enough.
• Who governs Britain?
• Stem cells to the rescue.
• Bill Mitchell quote of the week, explaining the curious phenomenon where the private markets were clamoring for public debt issues even when the government was running surpluses. And secondly, the fact that public debt has always found a market:

"If you then think about this, independently of the specific proposal that the paper is considering, public debt serves a core function for private profit-seeking. The mainstream macroeconomics textbooks and commentators never emphasise this aspect of public debt.

They are always relating it back to profligate government spending and the sovereign default. The reality is that public debt plays no fundamental role in funding government spending. But it plays a very crucial role in underpinning the risk management in the private sector.

In other words, public debt is really corporate welfare."

Tax carbon, or it will keep taxing us

When will we take our addiction seriously?

Far more serious than America's fiscal deficit / debt is our ecological deficit- the garbage we are spewing into the oceans and air. While in this blog I enjoy taking potshots at religion as our clearest and most outrageous example of cultural self-delusion, and have spent some effort on the delusions of the deficit terrorists and conservative economists generally, and also love to post updates on biology that interests me, none of those issues compare in importance with that of evironmental sustainability.

While the BP blowout sends perhaps one to two million gallons (or ~4,000 tons) of oil into the ocean daily, humanity is sending roughly 30 million tons of CO2 into the oceans daily by way of the atmosphere. Day in, day out, with no end in sight. This pollution may be invisible and less drama-turgic than an oil slick, but it is creating far-reaching and ever-mounting problems for everyone in the biosphere. And that means us, too! Al Gore has told us all about it, But out of sight, out of mind, and why deal today with what can be put off till tomorrow?

Washington's ditherfest on this issue reflects the general apathy of the country, (in addition to large dollops of corruption), which feeds off dramatic events like an oil spill, while finding it hard to attend to deeper and longer-term issues, especially those with economic commons characteristics, prone to pseudoscientific obfuscation, or hard to see directly. In short, it takes moral fiber to face up to the many ills of our carbon addiction:

1. Climate change, with disruptions to Earth's climate not seen for tens of millions of years. Do we have a duty of love and care to our fellow-travelers on planet earth? Should we give future generations of humans a degraded biosphere? Beyond the carbon cycle, we are also upsetting the nitrogen cycle with huge amounts of fertilizers, being responsible now for most fixed nitrogen on the planet. We are laying waste to whole ecosystems in slow motion. Will we take responsibility?

2. Pollution- coal pollution kills 24,000 people in the US, along with countless other health and environmental problems. We are scrubbing some acid from some power plant flues, but there are numerous problems with the remaining pollutants, including continuing acid rain. Mining coal rapes some of America's finest wild country, not to mention its danger to miners. Coal-fired pollution from China is starting to drift clear across the Pacific to us in California. Oil drilling isn't risk-free or clean either- nor is gas drilling. A carbon tax would cleanly target the most polluting fuels with the highest penalties, and would hopefully eliminate the scourge of coal use entirely here in the US.

3. Strategically, we accumulate endless problems incurring trade deficits to send money to Iran, Saudi Arabia, Venezuela, and the other petro-countries for their oil. We get poorer, and they incur the notorious "resource curse" that impedes governance and human development. We import about 1.2 million tons of petroleum per day, costing roughly $700 million per day. The external costs of this in military responsibilities throughout the Middle East and beyond, combined with foregone policy choices in places like Nigeria and Saudi Arabia due to our economic dependence, are incalculable. Our position is reminiscent of Rome's, dependent on Egypt and North Africa for its life-line of grain. That didn't turn out well, either.

So, what will it take to get us off oil? A recent newshour panel talked about new research investments needed to get this ball rolling.

It would be great to have spiffy new technologies and magical solutions. But we have all the materials we need at hand already, in the form of renewable, nuclear, and other technologies. What we need is the will and incentive structure to use them. Wind and solar power are on the edge of economic viability, combined with storage technologies for load balancing on a smarter grid. A serious and sustained carbon tax would give them the playing field they need by pricing-in the many ills attendent to fossil fuel use. Such an incentive structure will naturally bring out sustained technological innovation as well, without a lot of government involvement and direction. It is time to use economics to do the planet and ourselves some good for a change!

How high would such a carbon tax need to be? Energy consumption in Europe is roughly half of ours per capita, with gasoline and natural gas prices roughly double ours, due mostly to taxes. Europe's fossil energy consumption seems to have peaked, with renewables a growing part of their source mix. This would indicate that a carbon tax in the US that would double consumer fuel prices would take us a substantial distance towards higher efficiency and more renewable sources. Technological development that would extend this curve to the complete elimination of fossil fuels is in my view likely, but still a matter of speculation and future evaluation/policy adjustment. Remember that the current policy on acid rain, modest though effective, turned out to be much less costly than anyone estimated.

However partial such solution, it will still be a rather large political and economic pill to swallow, given our spineless political system dedicated to incumbant interests. The climate bills under consideration are only baby steps toward this solution, even after the BP blowout has so dramatically illustrated the stakes. If one thinks of humanity's long term residence on the planet, however, time is very much of the essence, as is effective action.

• Toles on a carbon tax.
• Some notes on a culture of responsibility.
• Who manages our companies?
• And Krugman gets it, on Europe's descent into double-dippery.
• Bill Mitchell quote of the week, here quoting Alan Greenspan, of all people(!):

"'The U.S. government can create dollars at will to meet any obligation, and it will doubtless continue to do so. U.S. Treasurys are thus free of credit risk. But they are not free of interest rate risk. If Treasury net debt issuance were to double overnight, for example, newly issued Treasury securities would continue free of credit risk, but the Treasury would have to pay much higher interest rates to market its newly issued securities.'"

Four genomes

A nuclear family gets its nuclear DNA sequenced. What can it tell us?

With sequencing technology going dramatically down in price and up in speed, and routine individual genomes within sight as a matter of routine medical practice, one group of researchers decided to sequence the DNA of two parents and their two children to see what we can gleen from such ultimate-detail data.

One thing to note is that the sequence of an individual's genome is static data. Once done, for whatever price, that is it- it does not have to be redone again, unless the original error rate was excessive. This work claims accuracy of 99.999%, which seems sufficient for most needs. At three billion base pairs, this amounts to 3,000 errors, which isn't nothing, but is very small.

On the other hand, the interpretation of this data is highly dynamic. As we learn more about how human biology works, how genes turn into cells, organs, behaviors, and about how the astronomical numbers of human genetic variants affect these traits, we can keep going back to our genomes to learn more about ourselves.

The paper makes several basic observations, improving data that had been approximated by other means. For instance, the human mutation rate turns out to be ~70 mutations per generation. Considering that roughly 2% of the genome codes for proteins, and no more than 30% of the genome involves gene-related DNA at all, (introns, promoters, etc.), this is a pretty modest mutation rate. We are all mutants, but the chances of something disastrous occuring are relatively small, as is seen in the phenotypic real world as well.

The researchers are able to map the recombinations that happened on each chromosome in each gamete that produced each child, in detail. Just over half occurred at what are called recombination hotspots, sprinkled along each chromosome. This remarkable process of recombination mixes things up genetically, insuring that what each child gets is not just a roulette selection of whole chromosomes from the respective grandparents, (which is what would happen in the absence of recombination), but a unique patchwork assembled out of both grandparent's chromosomes, insuring that each human is highly unique, and that, over long periods of time, genes get selected on their own merits rather than living and dying based on the many other gene variants with which they co-habit their chromosome.

The putative reason to do all this sequencing was to track down two rare and severe genetic diseases afflicting both children, and this complete sequencing offers several technical advantages for such a hunt. Firstly, the accuracy of each of the full sequences is increased by having the others to compare with. Shared variants are likely to be real, while unique ones can be explicitly resequenced to double-check. Assembling these sequences from the small individual reads that form the basis of all DNA sequencing is a huge computational effort, always helped by having a comparison base of maximally similar data.

Secondly, the density of this data makes finding disease-causing genetic variants much easier. In typical studies of genetic associations, a population of affected patients is studied, with comparison to a control group, randomly selected from the population. There will be a very large number of genetic variants among all these people. Ferreting out the variants or regions of variation that happen more frequently in the affected group is thus very difficult. In a family group, on the other hand, while the parents presumably have no special genetic relationship to each other, the group as a whole will have far lower numbers of stray variants, decreasing the search space substantially.

In this case, the researchers find that since two diseases they are interested in, present in both children but absent in the parents, appear to show recessive genetics, they can throw out 78% of the sequences, and, from the recombination map, focus on those bits of the children's genomes that are identical between them and heterozygous in the parents (22%). The variants also must be rare, based on the rarity of the syndromes (primary ciliary dykinesia and Miller syndrome), allowing them to throw out variants known to be common from other population genetic variant studies. This allows them to winnow down the disease candidates to four variant genes, as opposed to the dozens that would have resulted from a more typical gentic disease association study.

Personalized medicine is coming our way- it will combine sequence analysis of our genomes (in addition to molecular analysis of cancer biopsies and the like) with the developing knowledge of just what the sequence means- knowledge that is only in its infancy right now.

• The genetics of grooming.
• The dark heart of the Democratic party.
• A double-dip, on the way.
• Religion, shmeligion.
• Bill Mitchell quote of the week, regarding Greece and its suffering brethren in the Euro:

"If I was in charge of one of these nations I would announce next weekend (when the banks are closed) that I was introducing a new currency, defining all Euro debt liabilities in the new currency and let the foreign exchange markets value that currency on the Monday morning.

I would withdraw any semblance of central bank independence (that is just another democratic insult) and I would expand the budget deficit immediately by introducing a Job Guarantee.

Then by Tuesday, I would start repairing the confidence of private spenders to get the economy rolling again.

And after a relatively short time I would notice that economic growth was gaining speed, private spending was returning, unemployment was low and … the budget deficit was falling.

Then I would send an open invitation to the citizens of Germany to abandon the teutonic ship and head south (or west)."

What is labor's share?

How does labor's share of income and wealth happen? (Forgive me, this is sort of a thinking-aloud and lengthy post.)

In our time, large increases in productivity are going everywhere but to the laborers who are doing the work- to the financial sector, to capital, to government, and especially to the rich in the form of income and wealth inequality. Why is this, and what can be done about it? I will discuss a hierarchy of processes that affect this balance, from the easily understood to the more arcane.

(Please see a recent NYT story for a discussion of this inequality, with useful graphics.)

- Direct conflict: strikes, unionization, union-busting
One method of altering the share of income going to labor is to agitate directly for that increased share. Unions are the primary vehicle of pro-labor agitation, and in their heyday made America a much better place, with a more-equal distribution of income and other advancements in workplace decency. Conversely, antiunion government policies ("right-to-work" laws, strike breaking assistance, and race-to-the-bottom tax breaks for business relocation) and corporate agitation have the reverse effect. Since the 60's, antiunion agitation by large employers like Walmart, Ronald Reagan, and many others has been markedly more effective than pro-union activity. Thus, on balance, this effect has contrbuted to decreasing the labor share of GDP in recent decades.

- Labor markets:
Theoretically, the labor market lets employers bid for available labor, and in flush times, even for unavailable labor, poaching from other employers. Conversely, it lets workers bid for acceptable workplaces and higher salaries. In the aggregate, employers have to pay labor enough to staff the enterprises from which they can then reap excess profits and value. What limits labor supply, and what sets the price?

Conventional theory claims that it is productivity that ultimately sets the labor price.. that employers hire workers at the market wage rate until the marginal profit per extra worker reaches zero, assuming that the last worker is less productive in the enterprise setting than the first one.

A more realistic scenario might be that employers have certain models of how to run their enterprise at a certain scale with a minimum amount of labor. They hire that labor at the prevailing wage, then pursue productivity gains that allow them to eliminate those individual employees representing the lowest profit to wage ratios. The employer has no interest in hiring to the limit of marginal utility, since that is a waste of effort and profit in an organized business model which is not, typically, infinitely expandable. Thus there is no need to clear the labor market from an individual employer's perspective, and nor does pay in a given company necessarily rise to the level of productivity. In aggregate, however, new enterprises will hopefully be founded to employ marginal labor, depending on a variety of cultural and governmental settings, discussed below.

Businesses also have a variety of other advantages in the labor market. One is assymetric information, where a culture of secrecy surrounds salaries outside the HR department, putting applicants at a severe disadvantage. Secondly, employees tend to be more loyal to companies than the reverse, valuing stability for personal reasons and setting themselves up for undervaluation. Thirdly, in the internal competition to be a high profit-to-wage employee, the profit side of the equation is highly flexible, in the form of extra time spent, creative effort, and other contributions (though the reverse might also be cited, in Dilbert fashion, with pointless meetings, personal activities, self-dealing, and other drags on profit). On the other hand, pay is highly inflexible, raised only in the most notoriously grudging manner.

I'd rate this process as tending toward lowering the labor share as well, though it is perhaps the only process of those discussed here that can lead to wage gains when the stars are all aligned, which it to say, when enough entrepreneurs and businesses have pending business needs and credit available to bid up salaries. This happened most recently during the late Clinton years, not due to that administration's economic policies, but mostly due to the techno-cultural ferment of the computer and internet boom which raised productivity even faster.

- Immigration and trade policy:
Another broad influence on the macroeconomic settings and on labor power in particular is immigration policy, or lack thereof. While legal immigration is relatively balanced and doesn't lead to overall distortions in the employment market, illegal immigration has huge effects on the lower end of the labor market, essentially removing the wage floor for unskilled workers. The enormous tide of illegal immigration from Latin America is great for employers, who bid down unskilled pay to minimum wage and below, with under-the-table arrangements, and other means of keeping menial work not only underpaid, but distasteful. The upshot of this process is the typical mantra that such immigrants "do work that citizens don't want to do".

The alternative to importing and underpaying labor is offshoring work to low-wage countries. The usual theory of comparative advantage would say that we gain from this exchange, freeing domestic labor for higher-value pursuits, while getting advantages of trade. This only works when domestic labor is actually employed in higher value pursuits- something that is not the rule, needless to say. Scandinavian countries take a strongly supportive role in labor mobility, sponsoring serious retraining for displaced workers, leading to real jobs in such higher-value industries. The lesson is that the state has an important role to play in making such economic freedom for companies work for the labor force and country at large.

At any rate, our immigration and trade policies have been strongly on the side of decreasing labor's share of income, winking at a flood of low-skilled immigration, and providing trade agreements that favor US businesses, occasionally consumers, but never labor (NAFTA, for example).

- Macroeconomic policy:
A key insight of Keynes was that demand leads to production. Enterprises don't produce what doesn't sell, and they can only sell to someone who has money to spend, which was earned or was given by the government. Collapses in aggregate demand, such as we see currently as the private economy swings from excessively high indebtedness and consumption to higher saving, lead directly to lower production, and thence to a spiral of deflation unless the state (which prints the money, after all) steps in to fill the demand gap. The state ideally supplies money up to productive capacity, also funding the increased private saving and leakage via the trade deficit while also keeping aggregate demand afloat.

The stimulus package of the last year was a step in this direction, but clearly not enough, as unemployment remains painfully high and we head into what looks like a double-dip recession. High unemployment leads naturally to a lower wage share of GDP, as employers can bid lower for workers, as well as employing fewer overall.

On the long term, macroeconomic settings have critical effects on this balance, as the Federal Reserve's fundamental directive makes clear- "maximum employment, stable prices, and moderate long-term interest rates". Have they been pursuing maximum employment? I don't think so. Recent decades have seen the decline of Keynesianism and the rise of monetarism, after the inflation, stagflation, and resource shocks of the 70's led economists to pitch full employment under the train in favor of fighting inflation. The chosen weapon was high interest rates, which choked credit and business formation, lowering employment in what was generally viewed as "necessary pain" to wring inflation (in the form of escalating wage demands) out of the economy. All this was quite effective on the inflation front, but what of employment? Maximum employment has been reinterpreted as NAIRU, or the rate of unemployment consistent with low inflation. What unemployment is that? Well, it is very difficult to say. Could be 5%, or 10%. Right now, we have low inflation, so we could be at the NAIRU- no one really knows.

The fact is that there is no analytical method to determine the NAIRU. It is whatever unemployment rate has been consistent with low inflation in the past, and might change at any time, depending on cultural, technical, or other factors. It is a chimerical construct allowing policy makers to accept some arbitrary amount of unemployment as good rather than bad. But there are other ways to skin the cat of inflation, rather than through unemployment. Employment is very high in Japan while inflation remains very low, probably due to a high savings rate that keeps aggregate demand relatively low. The US in the 50's and 60's also had consistently high employment with low inflation, until the Vietnam war and other compounding fiscal and resource problems led to rising inflation in the 70's.

In that time period the US probably benefitted from consistent export surpluses which allowed rising private net saving with low government debt (i.e. even without government deficits, the private economy gained net financial resources from trade that it could save). Now that our trade balance is consistently in deficit, the government has to continually replace that leakage with deficit spending, leading to accumulated government debt, pending eventual re-alignment of our trade position. (Debt which is not bad, by the way. Who worries about our 28 trillion of accumulated private debt, compared to the 10 trillion of public debt? No one.)

At any rate, the Fed has focused on wringing out residual inflation over the last thirty years, accepting substantial levels of unemployment and underemployment along the way. The Fed has been pilloried for keeping interest rates too low in the last decade, fueling the housing boom with easy money. I would disagree. The Fed was partially at fault, but not for low rates- those were fine, general inflation being quite dormant. Rates are a very blunt instrument, penalizing all businesses and workers for the sins of one sector in this case. No, the Fed's fault lies in lack of regulation, both of the mortgage industry, and of the high-finance industry, which created such an Everest of fraudulant "instruments". Its laxity was driven by ideology, assuming that markets self-correct and that active and adversarial regulation is unnecessary. They do self-correct, but not in a timely fashion. After all, Ponzi schemes self-correct as well, eventually! The Fed was established to mitigate this kind of destructive self-correction that was recurrent in the 1800's, and it failed spectacularly in that role.

High interest rates are a drag on business and labor, but more pernicious for labor, since while the number and size of businesses can go down during a recession, the population can't- it keeps going up, leading to the agony of unemployment, as well as the market effects noted above where wages are bid down to the lowest level necessary to hire the desired worker. I.e., the labor share of a shrinking GDP decreases. This is one reason why most economists take economic growth as such an automatic good- even though growth may represent unsustainable resource use, pernicious monetization of human needs, and counterproductive activities of many other kinds, the basic need for employment is only met in a setting of economic growth.

The Fed was also at fault for persistently calling for federal fiscal discipline and balanced budgets, via ideologs like Alan Greenspan. It was this fiscal discipline, briefly expressed as federal budget surpluses, which drove the private economy into high debt which has now imploded. Government spending has to cover leakages from the private economy- leakages like trade deficits and net savings to government bonds which reduce money available for consumption. With the economy in perpetually high trade deficit, and the dollar not adjusting due to its special position as the world's reserve currency, (among other reasons), far more government deficit spending was needed to keep the private economy from consuming out of private debt as has happened over the last decade. Issuing government debt for all these deficits was also not necessary- debt is purely a monetary operation to guide interest and inflation rates, and is not required to directly "fund" government spending.

- Cultural settings of education and optimism:
Now I transition from what is economics (loosely construed!) to what is practically theology. Entrepreneurs create jobs, combining inspiration, skills, labor, and capital into new ways to fulfill human needs. Apple Computer is a great example of a persistently entrepreneurial operation, which keeps coming up with new businesses- ways to transform mundane materials and engineering talent into satisfied human desires and economic flows.

Entrepreneurs need a variety of external ingredients, principally labor with the education or skills to realize a new vision, and capital. If capital is scarce, as it is right now, then labor excess is not going to make up for it, unless its price is bid dramatically down, perhaps to garage start-up levels. Conversely, all the money in the world isn't going to make an Apple Computer- it takes education and more broadly a culture of technical innovation, even geekery. This is what makes urban environments so productive relative to rural ones- labor's share is higher in dynamic urban environments because the balance of entrepreneurs with the necessary ingredients for job creation is high, compared to the labor pool, leading to economic growth. In rural areas, wages are low, but that is not enough to offset the lack of an educated labor pool flexible enough and concentrated enough to turn its hand to many different value-creating ideas.

But not all urban environments are dynamic, and this is California's achilles heel looking to the future. Our schools have dropped to among the worst in the nation, as we have counted on the cultural / physical climate and the UC system to attract bright people from elsewhere to employ a workforce which is heading toward unskilled labor due to demographic and immigration trends. As California becomes increasingly dysfunctional politically, educationally, and economically, entrepreneurs may lose access to the requisite concentration of skills and eventually the sense of optimism to keep building high-tech businesses in the state. This would seriously impair not only economic growth, but also, given a lower rate of business formation and job growth, labor's share of the economy.

- Conclusion:
Now, it could be that capital and high earners have in all truth become more important than labor to the production of GDP in the US, deserving their higher and growing share. Perhaps with rising automation and other technological conveniences, the marginal product of low-skill labor has declined, while the leverage of high-creativity and capital-intensive work has increased. Perhaps the ceaseless winner-take-all nature of many professions has properly segregated very high producers from the riffraff, now unsupported by blanket protections they might have enjoyed in the past like unionization and conveyer belt-like promotion and seniority systems. We may have transitioned to an Ayn Rand-ian meritocratic system which has finally uncovered the true relative worth of various economic actors, both human and monetary.

However, I doubt that is the case. First principles would indicate that with rising wealth, the economic value of that wealth as capital should decline relative to the labor which is the true source of creativity in employing it. The more wealth we pile up, the less useful each increment is in funding productive activity. Thus one suspects that the evident higher returns to wealth in recent times are a form of rent, perhaps due to rampant financialization and excessive private indebtedness that has afflicted the US economy in recent decades.

Secondly, inequality between high and low earners is very hard to defend if one takes our educational system seriously, since it cranks out broad classes of certified people for the various professions and other pursuits. While there are surely fine differences in personal characteristics that make people variously productive after such training, they are unlikely to correspond to the differentials of hundreds-fold present in today's business pay structures. Not in any linear fashion, at any rate. Far more likely is that these markets are defective, either because of intrinsic problems of tournament-like markets, or because executives defeat market mechanisms by collusion, misappropriation of shareholder equity, etc., while using the same markets to consistently underpay employees.

• A little harmless dreaming on the economic left.
• Back to the barricades in Europe?
• A brief little labor primer.
• Larry Summers even gets it, seemingly.
• How science works.. by critique and experiment.. somewhat unlike theology.
• Mr. Bully kindly requests that we bomb Iran.
• Revolving door sleeze under Ken Salazar.
• We may be headed for a double-dip super-recession.

Note to fish: We can't see you!

The sea of slaugher keeps getting worse.

The current oil spill in the gulf of Mexico has been a tragedy of errors, none of which are more appalling than the out-of-sight, out-of-mind attitude taken towards sea life. News reports uniformly fear damage that might happen if the oil hits the shoreline, and breathe a sigh of relief if the mess appears to wash out into the Atlantic.

Adding insult to injury is the use of delicately named "dispersants" in the hundreds of thousands of gallons, in order to reduce the unsightliness of oil on the ocean's surface. Apart from the incenstuousness of BP insisting on using chemicals that it has a financial interest in, the whole idea is fundamentally troubling. ToxicA + ToxicB = ?less toxic situation?

Corexit (what a great name- as though this material was going to make a problem go away) is a mix of soaps and solvents, themselves toxic to all forms of life, doubtless more so the more one relies on water to live. It contains:

- 2-butoxyethanol, used as solvent in paints, inks, and cleaning products like Simple Green.

- Sulfonic acid, a kind of soap, which, well, let wikipedia tell the story:

"Sulfonic acids are typically much stronger acids than their carboxylic equivalents, and have the unique tendency to bind to proteins and carbohydrates tightly; most "washable" dyes are sulfonic acids (or have the functional sulfonyl group in them) for this reason."

- Propylene glycol, which is relatively non-toxic, being used in drugs and animal feed.

- And other proprietary ingredients, probably of a detergent-like nature.

It is hard to imagine that fish would like this material. But who cares about fish? For many kinds of wildlife, (birds, mammals, some fish), it is good to get oil off the surface where they spend a great deal of time, and where we like to go bird-watching. But adding further toxic, and ironically petroleum-derived chemicals to the disaster mix presents increased problems for everyone else in the ocean.

• Some links on the oil-dispersant mess.
• The beauty of Jellies and other denizens of the deep.
• Palau asks to have its ocean back.
• Bill Mitchell quote of the week:

"Unemployment is about a lack of jobs. If the private sector will not create enough jobs then there is only one sector left in town that can. Hellooooo! Its called the government sector.

They can do it directly (that is, hire the workers themselves and put them to work advancing public purpose – rebuilding community and environmental infrastructure; providing personal care services; etc). There is never a shortage of work – just a shortage of funding to pay the wages.

They can also do it indirectly by stimulating the private sector via tax cuts or targeted spending. Both approaches have advantages and disadvantages but the net effects are always overwhelmingly positive."

(Noting as usual that a fiat currency-issuing government can provide funding without limit when inflation is low.)

Bullying Iran

Perhaps the US should take a breather from its vilification campaign against Iran.

US foreign policy can get curiously ossified at times. Our stance toward Cuba is an example, which after the trauma of the Bay of Pigs and Kennedy's assassination, seems to have drifted into auto-pilot, not thinking too hard of what would be best for our interests, let alone what would be best for Cuba and the region.

Likewise, we seem to be carrying on a long-term grudge against Iran, dating from their Khomeini-ite revolution. It is frankly embarrassing to see the US try to bully Iran, to little avail, on its uranium processing and nuclear weapons policy.

Barack Obama took a promising tack when he first come into office. His reduction of pressure resulted in a deep destabilization of the Iranian government during its fraught elections. The equation is clear- the more pressure we apply, the more recalcitrant the Iranian government is, and the more support it gets at home, squeezing just a little more mileage from those tired old great Satan slogans. Bullying by the biggest country on the block never looks very good.

But now, the Obama administration has tacked back to a campaign of vilification, with embarrassing speeches by Hillary Clinton at the UN about how terrible Iran is, and how the nuclear non-proliferation agreement is not a residuum of neo-colonialism, but the self-evident and permanent apotheosis of universally accepted international relations.

Unfortunately, it is all too transparent where this change in policy comes from- it comes from our symbiotic relationship with Israel, which is running scared over a nuclear threat from nearby governments that hate it. It is also a neocon hangover from the Bush years and before. It also comes from our own difficulties with Iran's role in Iraq and Afghanistan, on the borders of both of which it sits, and with Islamism in general.

What are the risks? First is the risk of Iran actually carrying out its threats of wiping out Israel with a nuclear bomb. I think it should be clear that the chances of this, even when Iran does aquire a bomb, are minuscule. The history of nationalistic and diplomatic bombast is a long and painful one, but rarely reflected in action. Iran, even while indulging in clownish rhetoric, has shown a pattern of measured power projection, including provocations on its borders and through its Shiite friends in Lebanon and Palestine. Its relationship with Syria was mostly strategic, when it was mortally threatened by their mutual neighbor, Iraq. The unanticipated benefit of gaining Arab street cred by irritating Israel via its Hezbolla clients was purely gravy.

Not to mention that Israel has plenty of deterrent capability in the form of nuclear bombs of its own, hopefully well-protected from attack, and quite a bit more to the point, from its own rather numerous religious crazies. So I'd assign this prospect to pure fantasy. As far as terrorist appropriation of such a weapon goes, we are into this scenario pretty deeply already with Pakistan, with no accidents to date. I'd rate Iran better run, with better technical and cultural coherence than Pakistan, and thus estimate that Iran could control its bombs at least as well.

Second is the risk of Iran rising to become a true regional hegemon, supplanting US influence to some extent. This is a more serious threat, and certainly has Saudi Arabia quaking in its boots, as well as Israel. The ironic aspect of this is that the more we bully Iran, the more credibility it gains, both at home and in the Arab world. On the other hand, the more doctrinaire its policies- the more theocratric and economically closed it is- the less likely it will gain and consolidate this kind of influence. The more open it is and accepting of modernizing influences, the more successful it will be economically and culturally in what is, after all, a rather diverse Arab world and one that is majority Sunni.

So I would see this threat as self-limiting, which to say that insofar as Iran is dangerous, it will not be attractive to others in the region, whatever its purely military power. Israel serves as an example, having all the military power one could hope for, yet hardly being a hub of local cultural or political influence, for obvious reasons. The only influence it does have is not due to its military power at all, but due to its democratic system which serves at least in form as a counter-example to all others in the region.

Additionally, the real problem with Iran's nuclear ambitions is local- with its volatile neighbors. It isn't the US that needs to worry about Iran's bomb. We have plenty of distance and bombs of our own. If we had our diplomatic wits about us, we would let the local powers (i.e. Saudi Arabia, Egypt, perhaps Iraq) take the lead, and have them ask the UN for relevant sanctions, etc. One could even imagine a common front between those countries and Israel, if Israel hadn't completely alienated everyone in the region. The nascent denuclearization movement in the Middle East is such a local initiative, and the US should support it rather than torpedoing it at the behest of Israel.

Compared to the risks, what are the opportunities? The grand prize is obviously flipping the Iranian state from its Khomeini-ist system to something more democratic and less militant. Any other opportunities pale in significance, such as prying Iran away from Russian influence, or cutting Iran's oil revenue by restricting trade and establishing green energy, etc. Such an enormous change came very close to happening in the last election cycle. The population seems deeply interested in such a resolution, though it is hard to tell what the true proportions of sentiment are. All of our policy should be aimed at promoting this process. As noted above, our bullying has the opposite effect, consolidating the current state, and accentuating its interest in getting exactly the weapon at issue. Unless we have a big stick to wield, (and we don't), we'd be better off speaking softly.

Our policy should be to speak the truth and engage where we can. We should not recognize the current state as legitimate, since it is not (ditto for Afghanistan, unfortunately). We should also not sign off on nuclear treaty compliance that doesn't exist. But our target should be the vast population that yearns for modernity and for a voice in the context of a fully autonomous and democratic Iran. We needn't encourage Iran to build a bomb, but should at least recognize their desire for such a deterrent, beset as they are with US forces on both sides, and having faught a catastrophic war just 25 years ago. Israel, for its part, would be better off mending its own wretched relationships with the Palestinians and the rest of the Arab world rather than egging us on to foolhardy diplomatic/military adventures.

Iran is a historically rich, sophisticated country with plenty of its own problems, like rebellious minorities, a corrupt and ideologically rotten elite, and energy needs that may outstrip its pace of energy development. The Khomeini-ist state is an unfortunate problem, for its subjects as much as for us. But it has shown a good deal of practicality over the years, and ultimately can't win against its own people, as they are increasingly aware of conditions and trends outside their country, and of their own power. It seems a good deal more fragile than, for example, the Chinese government, due to its internal complexity and an ideology that has diverged substantially from that of the public at large.

The risks are small, and the opportunities are large. My prescription would be to pursue quiet containment against the government of Iran while accentuating democratic, open principles at every turn in public, as we should universally in our foreign policy. We should promote travel between our countries, as well as non-sensitive trade and other exchanges. The enormous Iranian expatriate community in the US would probably welcome such an approach and be an important medium of improved relations as well as cultural change.

• Who cheerleads for more bullying? What a feud. After the kindness of Cyrus, you would think they would be a little more grateful.
• Afghanistan- still coming unraveled.
• ...or perhaps not so much. Shalizi on Afghanistan- wealth of links, etc., including a detailed political network analysis.
• Evolution- still a dirty word.
• The Euro is on its death-bed. Dissolution, or pan-European government and fiscal policy- that is the stark choice.
• More on the Euro.. mentioning its trend toward pre-Keynesianism. Why aren't we doing more post-Keynesianism here in the US?
• A Keynesian prescription for Britain.
• More on criminal, er, financial, racketeering.
• Big government fights back against free information.
• God is here .. at minute 26.
• Bill Mitchell quote of the week, speaking of Europe particularly:

"So a classic mainstream argument that unemployment is caused by excessive real wages and government regulations. If you took time and analysed the shift to profit share over the period he analyses, you will realise that productivity was running ahead of real wages. So where was the real wage overhang?"