Travels and meetings of ancient humans

Australians branched from Out-of-Africans long before Europeans and Asians diverged.

An interesting caveat to the Out-of-Africa origin for modern humans is that perhaps 4% of our genomes apparently comes from archaic humans these modern African emigrants encountered in Europe and Asia- the Neaderthals and a recently discovered more eastern relative of the Neanderthals, the Denisovans of the Altai mountains, a bit south of Novosibirsk, of whom a couple of bones and DNA are known, but not much else.

Which parts of our genomes? Well, a recent paper claims that up to 60% of some modern immunological genes stem from these archaic genomes, suggesting that pathogens encountered outside Africa may have been novel and subjected emigrating humans to selective pressure that the resident proto-humans had already mastered, genetically speaking.

The human leukocyte antigen (HLA) genes are an interesting group in several ways. Their function is to expose small bits of pathogen-derived proteins that the leukocyte (an antigen presenting cell) has been chewing on on its outside surface, so that other parts of the immune system (like killer T-cells) can "read" what this first line of defense is seeing and responding to. It is a very elegant system, finely balanced between over-active auto-immunity and prompt action against foreign pathogens.

No single (HLA) protein is ideally suited to hold and display the large variety of foreign proteins that the immune system may encounter, so we have three: HLA-A, -B, and -C. These proteins are additionally highly variable through human populations and vary quickly with evolution, as the pathogens we meet change quickly as well. It is highly beneficial to have different alleles of each gene from one's parents (i.e., be heterozygous), and women are thought to be able subconsciously to detect whether the men they are mating with have different HLA alleles from themselves. Wow!

This kind of selection is called "balancing" selection, where the optimal genetic population structure is not one ideal allele of one gene, (i.e. the "perfect", or evolutionarily "best" gene), but a diversity of different alleles. This theme is likely to be highly significant in psychological characteristics as well as immunological ones.

At any rate, one research group recently used the available DNA sequences from Neanderthals and their cousins, the Denisovan archaic humans, to determine that some of their HLA alleles are not closely related to anything found in Africa today, and yet make up a substantial portion in many non-African human populations. Which is to say that humans today outside of Africa obtained significant immunological diversity from their mating with these archaic humans.

HLA-A 11	(Denisovan)	Up to 48% of populations centered on South China and Papua New Guinea.
HLA-B 73	(Denisovan)	Up to 4% of people in west Asia, centered on Afghanistan.
HLA-B 07:02	(Neanderthal)	Up to 17% of people centered on Britain and Scandinavia.
HLA-B 51:01	(Neanderthal)	Up to 18% of people centered on Eastern Turkey.
HLA-C 12:02	(Denisovan)	Up to 11% of populations centered on Mumbai and Japan.
HLA-C 15	(Denisovan)	Up to 19% of populations centered on Pakistan and northern Australia.
HLA-C 7:02	(Neanderthal)	Up to 30% of populations centered on Moscow and south China.
HLA-C 16:02	(Neanderthal)	Up to 5% of populations centered on Iran.

Geographic distribution of one archaic HLA human allele.

---

Once the recent African origin of modern humans became clear, many other questions arose- how, when, where, and who? Upon leaving Africa, which groups went where and when? A second paper gives quantitative evidence, from one partial Australian aboriginal genome sequence, that this group split off long before the Europeans and other Asians separated.

Geographically, one would suspect that, like the Native Americans and Polynesians, Aboriginal Australians would be at the end of the line of human divergence, separating at very late times from nearby groups in Southern Asia (model A). Morphologically, however, Aboriginal Australians don't fit this template at all, having closer resemblances with Africans than with the geographically intervening groups such as the Polynesians (model B).

The genetics bear out the latter story. These researchers used a museum sample of Aboriginal hair, apparently to evade problems of genetic contamination with Europeans, to sequence about 60% of one genome. They also sequenced three Han Chinese genomes and of course had numerous other genomes to work with by this point (about 1,220 individual sets of snp data).

The data took the form of snps- single base pair alterations/mutations from the common sequence that can be used forensically to track lineages, since descendents share the alterations of their ancestors than those of non-ancestors. All this data (14,000 snp sites) was thrown into a statistical program that spat out expected rates of snp identities under various lineage models.

The numerical differences / output are impossible for a non-expert to comment on, but they claim high statistical significance for their result that model B beats model A by a long shot. They also estimate the time from African/Australian divergence at 2750 generations, or about 70,000 years ago (using a generation time of ~27 years, apparently). In contrast, the European and Asian lineages diverged less than half as long ago, about 30,000 years ago. Indeed, this second divergence would seem to be an entirely different dispersal event that may have swept previously resident Australian-lineage peoples from all areas of Asia other than the far reaches of Papua New Guinea and Australia which become isolated about this time by rising sea levels. (And the Aeta in the Philippines.)

The global map they offer is:

Lastly, these scientists are also very excited by the possible mixing of Neanderthal or Denisovan genomes with those of the future Australians. Interestingly, they find the same degree of Neanderthal mixing in their Australian genome as in European and Asian genomes, indicating that, rather than mating with the final Neanderthal holdouts in Southern Europe, the mixing we observe genetically took place soon after the first migrations out of Africa.

For the Denisovan DNA, they find higher amounts of mixture (unspecified, but probably ~4%) in their Australian genome than in virtually any other group, indicating that this early migration had especially close contact with these archaic humans.

It is fascinating to see our origins come into clearer focus through the analysis of new data. Old conflicts like the early (regional speciation) versus late out-of-Africa theories are now definitively resolved, finding a bit of truth in both, but mostly favoring the later out-of-Africa theory. The travels of our ancestors, while hardly tracked with GPS, are slightly less obscure, indicating that native Australians have, in the words of these authors, "one of the oldest continuous population histories outside sub-Saharan Africa today", dating back roughly 50,000 years.

• Some are obsessed with nearer-term geneology.
• Solar time is now.
• Capitalism without owners- not working so well. New governance is needed.
• Default on foreign lenders, followed by broadly shared economic growth.. what's not to like?
• Zombie banks need to be nationalized and resolved.
• Trickle-up economics: not natural, but engineered.
• Does the Big Lie have legs?
• A video on tax policy, broke-ness, and the dinosaur economy.
• Wildlife crisis- even worse than the economic crisis.
• Quote of the week- Wynne Godley, godfather of the MMT school saw it all coming back in 1992:

"If a country or region has no power to devalue, and if it is not the beneficiary of a system of fiscal equalisation, then there is nothing to stop it suffering a process of cumulative and terminal decline leading, in the end, to emigration as the only alternative to poverty or starvation."

• And Krugman: "If you were part of the dialogue in the late 80s and early 90s, it became clear that the euro was best understood as a plot by Italian technocrats to get themselves German central bankers. This was not, it turns out, a good idea."

On moral subjectivity

Are moral truths objective? Are they even "truths"?

A recent New Yorker profile of Derek Parfit tapped into a broad and untypically theological theme that there must be something absolute about morals- something objective and fixed, a standard that we all know by some (maybe god-given) instinct and reach for or knowingly violate. A recent Philosophy bites podcast ventured into similar territory, with Paul Boghossian. (Here is a typical academic discussion.)

I'm no expert here, but very much take the opposite view, (most famously presented by Hume), that we come up with our morals subjectively, and communally by negotiation, ending up with characteristically human, but variable systems for entirely this-world reasons. The only hint of the absolute is game theory, which lends inescapable structure to our transactions, as it does to evolution more generally.

One interesting pursuit of philosophers of ethics (such as Parfit- or Rawls, or Singer, or Kant, or Plato) is the contruction of ideal moral systems founded on reason. For Rawls, reason says that we should build societies that treat everyone fairly, with the particular rule that in doing the design, we should assume that we would arrive into that society at a random position, not the position we currently hold, thus motivating author of such a system to be maximally impartial, just, and fair.

"He came up with what he called the Triple Theory: An act is wrong just when such acts are disallowed by some principle that is optimific, uniquely universally willable, and not reasonably rejectable." - from the New Yorker profile of Parfit cited above.

Well, this certainly sounds great, but one has to ask: why? What makes reason come up with such schemes? What motivated Rawls to come up with this scheme, and what could possibly make it "right" instead of "wrong"? There have to be premises here on which reason operates, such as our desire to be treated fairly, to be free, to have the opportunity to fulfull our personal potential, and live as well as is practical. There has to be a point. All the relevant points are desires. They may be common desires, but they are not unversal desires. It is the problem of competing desires that creates the whole need for moral systems in the first place, and adjudicating among them can't possibly be the job of reason, in the end, though reason is certainly helpful in articulating our choices and forecasting their consequences. At any rate, it is human desire that justifies a "reasonable" or utilitarian system for getting them satisfied.

So the logic of morals as I see it is that we have desires & needs, and this leads to the creation of a moral system that satisfies them in the face of other people with their own, either complementary or competing desires. I find it extremely hard to see where absolutes enter into this logic. Humans may well have desires that are programmed by god. We have no idea. But even if so, it is from that programming that our premises for "reasonable" systems descend in practice, not from some deity telling us directly what is good and what to do (Biblical interpretation aside, which would truly be going down a rabbit hole). Indeed, some of the most interesting religious literature features people telling god how poorly he has behaved, and shaming him to do better.

One can certainly see the practical attraction of positing morals as absolute and god-given, especially one's own. But that is a mere con game if no one has evidence that his are any more or less god-given than those of others ... which is the position I think we are in.

• Oxytocin or oxycontin? Morality and the mind.
• Scott Atran on religion and atheists. A podcast telling atheists how hopeless their cause is.
• Salon offers an Occupy manifesto.
• Please consider transferring from your megabank.
• On criticism and the truth illusion.
• Crony capitalism kills. Government saves lives.
• Compound interest trumps compound growth- one ratchet of wealth inequality.
• Do you pay negative taxes?
• Afghanistan needs a post-US economy. A functioning society would be nice, too.
• Quote of the week, taking a moment away from economics to learn about higher education. From Science magazine, taken in turn from Teachers College Record, 114 (2012):

"Most students enter college aiming for a 4.0 GPA. Given that grading in American educational institutions is unregulated, how meaningful is a 4.0? Rojstaczer and Healy examined grade distributions from 200 American colleges and universities over the past 70 years. They report that movement away from the traditional bell-shaped grading curve began in the 1960s and 1970s in order to help students avoid the military draft. A continual rising of grades followed, without the accompaniment of increased student achievement. Graduation rates have remained largely static for decades, the literacy of graduates has declined, and college entrance exam scores of applicants have fallen. America's educational institutions have gradually created an illusion where excellence is widespread and failure is rare. In fact, “A” is now the most common grade. Efforts at grade regulation are controversial, but without grading oversight, either on a school-by-school or national basis, it is unlikely that meaningful grades will return to American education."

Evolution, revolution, or redistribution?

In evolution, losers die. What happens in capitalism?

Trite as it seems, comparing capitalism with evolution still makes sense to me. (And to others.) Companies struggle with each other to survive, and the losers disintegrate. But individuals (i.e. people, er, I mean humans) in our system are in a similar Darwinian struggle for jobs and income- now sharply accentuated with globalization. When individuals succeed, the results are clear- they get rich, maybe famous. But what happens when they fail?

That is a bit of a problem in capitalism- those who fail don't conveniently disappear, but linger in poverty, creating political and moral problems. They test a culture of pure rapacious competitive greed for the presence of human values. For her part, Ayn Rand couldn't give a fig for the fate of the losers- the proles, the leaches. That would be the orthodox capitalist position, though there is the small complication that after the money has all been taken from the losers, the winners still need workers to give them food and pedicures. Exactly how little can workers be paid and still arrive to work? And secondly, how can the moral claims of losers in unemployed poverty be best ignored and dismissed?

This brings us to our political moment and the Occupy Wall Street movement. The last few decades have featured a cult of the market and the demonization of human values in the name of supposed efficiency and just deserts. The result has been a well-oiled economic machine that transfers wealth upwards and glorifies the rich. Only, the market turned out to have a screw loose. Greed unleashed led to fraudulent banking on a cataclysmic scale, among many other pathologies in finance. Profligate lending to unqualified borrowers was not bumbling, generous, or inadvertant, but a pattern of fraud perpetrated by businessmen motivated by personal greed over organizational, not to mention systemic and public, responsibility.

They won, sure enough- took the money and ran. Virtually none have been called to account. It is the line where "winning" in the capitalist competition crosses from serving customers to fleecing them and destroying their lives. Obfuscating this basic dynamic is what current Washington politics is all about, especially on the Republican side. And exposing and resolving this dynamic is what OWS is all about.

The losers in capitalism don't quietly fade away, but linger on as citizens, voters, maybe protesters. This is where humans transcend evolution and the bare laws of competition. For all of biology's glories, it has been an extremely painful and slow process, and has resulted in sub-optimal solutions. The fact that humans, once evolved to have enormous brains, could take the world by storm, occupy all lands, commandeer all resources, and fly off into the solar system ... well, that shows how limited the scope of evolution had been up to that point in comparison. It testifies to a consciousness and intellect that reaches far beyond competitive narrow-mindedness- so faithfully modelled by market competition- to a revolutionary capability to foresee the future, to alter circumstances, and to adopt a whole new vision of humanity.

It is a humanity that engages in common effort, plans in common for future prosperity, and shares the fruits of that planning. It is a humanity that harnesses markets and competitive logic as tools, but not as a theology that places Mammon ahead of all else. Polls show that most people share this vision- one of rational forethought, mutual moral obligation, fundamental legal/political equality, and measured economic inequality. Everyone, perhaps, except the most stultified economists.

So, somehow, we have gotten blown off track by the ideology of greed and false efficiency, back to a Herbert Spencer-era economic Darwinism as an ideal of human affairs. Yes, some degree of competition and unequal reward is neccessary to make the economic wheels go around on a micro level. But other values are required as well: a democratic political system that directs the economic system, instead of being corrupted by it; recognition of public goods as essential goods; and progressive mechanisms (specifically, a financial transaction tax, among other means) to counteract the ratchet of wealth accumulation in the hands of the few so that other virtues besides greed can have a place in our society.

• Roubini analyzes inequality ... Karl Marx was right.
• Regulating money power.
• What do we want? Impunity for the rich! When do we want it? Yesterday!
• The right competes to propose even more presents to the rich.
•  .. and can be Keynesian when needed, showing intellectual er.. flexibility.
• What is missing in Greece? Taxes from the rich.
• Martin Wolfe meditates on economic justice and efficiency.
• An army of fobbits ... and a lesson in providing jobs for all.
• How was Iceland's crash resolved? By default, fiscal support, putting women in charge, and forcible bank resolution. An object lesson in who has control- the government, not the markets.
• Economic quote of the week, from Bill Black- Whom do the euro masters serve?

"The ECB has no statutory mission to protect the interests of Greece’s creditors. Its decision to side with the interests of Greece’s creditors (overwhelmingly European banks, particularly German banks) against the interests of a member nation makes clear why the ECB poses an enormous danger to Europe. The ECB is dominated by theoclassical economists who glory in their “independence” from democratic institutions but are slavish servants of the systemically dangerous institutions (SDIs) – the misnamed “too big to fail” banks."

Evolutionary knob-twiddling and networking

Butterfly wings and waves of ancient innovation highlight the dynamism of transcriptional control in evolution.

When you hear about small changes during evolution.. the retreat of brow ridges from Neanderthals to Homo sapiens, or the growth of our brains over longer spans, you are typically hearing about changes in regulation of proteins that are themselves unchanged. A little more expression here, a little less there, and perhaps a few more years of expression during childhood.. it all adds up to just the kind of gradual change that Darwin had in mind when he saw that variation is pervasive in biology, and the raw material of evolution.

In our genomes, the locations most conserved over geological time are the protein-coding sections of genes. They are the raisins in the pudding, around which much less stable DNA swirls- the introns, promoters, enhancers, centromeres, telomeres, transposons, repetitive elements, and other material / junk, each of which have their own, typically faster, rate of change. When a protein sequence changes, its action everywhere changes immediately. In contrast, changing where and when it is expressed can have smaller and more subtle effects. More gradual effects, in an evolutionary sense.

Regulatory regions (promoters and enhancers) that control protein expression are dispersed, often spread over many times the length of the protein-coding DNA. They are also modular, composed of separable cassettes with specific control effects/patterns, in contrast to the mostly linear one-damn-amino-acid-after-the-next nature of protein-coding DNA. (Putting aside protein coding flexibility based on intron/exon dispersion). This pattern of dispersed controls is an inheritance from our Archeal ancestors, and is part of what made eukaryotes such revolutionary life forms, able to evolve rapidly relative to bacteria.

Example of a human gene (DAC1) of 2,274 protein-coding base pairs, itself a set of exons (B, in center, vertical black lines are exons) dispersed over 430,000 base pairs of introns. It is set within a 2,000,000 base pair region (A and B) with modules (B; red marks similarity to human) conserved in several species, and individually capable of driving gene expression in mouse embryos as shown in C. (H-human, M-mouse, F-frog, P-pufferfish, Z-zebrafish)

Two recent papers highlight this property in different ways- one about the patterning of butterfly wings among species that convergently evolve to mimic each other's designs, and the other tracing ancient innovation in the vertebrate lineage by bursts of regulatory change followed by conservation/stasis.

Taking the second article first, the regulatory regions of our genome are peppered with small modules (typically much smaller than protein-coding segments) that are somewhat conserved, for their regulatory role. Each module typically drives expression of its associated gene in response to an environmental event, or at a specific time and place in development, as in the above example.

The authors dredged up such modules en masse from several vertebrate genomes (about 10% of all gene regulatory elements, from two fish, cow, mouse, and human) and ask when they first became conserved in evolution, and what genes they associate with. Not being as well conserved as proteins, virtually none are traceable beyond 600 million years ago. The paper is mostly devoted to methods, since these sites are small, difficult to align across different species, and their times of origin are difficult to estimate. But I will leave the methods issues aside.

The interesting finding is that over this span of time, there were four distinct patterns of regulatory innovation (i.e. origination and conservation of regulatory modules) tied to different kinds of genes in vertebrates. The first wave, peaking at the very start of available data at 500+ million years ago, was of transcription regulators themselves, which bind to regulatory DNA sites. This indicates variation and evolution in the most basic programs driving animal function and development.

The second epoch ranged from 500 to 200 million years ago and is associated with developmental genes, reinforcing the finding above, but indicating that the deployment of transcriptional regulators was solidified well before the full palette of developmental possibilities was explored. Development is mostly regulated by the coordinated expression of genes, including transcription regulators, that go on to regulate other genes and proteins in a cascade or network.

A third epoch peaked sharply about 250 million years ago, being the fixation of regulatory sites near receptor genes (Figure below). Receptors play central roles in the nervous system, in smell and taste, and in hormonal control systems like the sex hormones. All these areas were important areas of innovation through the vertebrate lineage, but apparently concentrated at this era just as the age of dinosaurs began.

Lastly, the most recently fixed set of regulatory sites lie near genes involved in post-translational protein modification. This is the attachment of molecules ranging from tiny methyl and acetyl groups to fatty acids like palmitate up through whole mini-proteins like ubiquitin and its many relatives to an active protein.

Period during evolution (x-axis) when regulatory modules near specified classes of genes (noted at top) arose and became conserved (y-axis), indicating a function of increased importance,

These modifications exemplify evolutionary tinkering and jury-rigging. They originate in other processes, (markers for protein degradation in the case of ubiquitin), whose components (or copies thereof) were dragged into new regulatory roles, at first perhaps as just a tentative little tweek on top of the existing complexity, then over time used in more roles when other sources of variation and adaptation had already been so networked that they couldn't change. The evolutionary story suggests that in our lineage, the deeper and more central the system of regulation, the earlier it settled into a more-or-less stable, conserved, and unchangeable, state.

---

Turning from deep time to more recent events, butterflies in Northern South America are (for the time being) highly diverse. Yet some have converged from different lineages towards similar wing patterns in violation of the general rule of species divergence, and particularly the rule that different species need distinct markings to promote correct mate selection and ecological niche maintenance. This mimicry comes in two versions. Either a distasteful species is mimicked by another that is not distasteful in order to steal its advertising.. i.e. its protection from predators, (Batesian mimicry), or two distasteful species converge together in order to raise the level of advertising they share (Müllerian mimicry).

They would make car dealers proud! But what causes all this plasticity of wing patterning? How do butterflies find it so easy to create and then alter their beautiful patterns? Authors of this paper find one gene that seems to be in charge- a transcription regulator whose own regulation holds the key to variation in the Heliconius genus of butterflies, a distasteful genus (to predators that is, not to us).

Geographic distribution (B), lineages (A, horizontal), and mimicry (A, vertical) of selected Helioconius butterflies.

In this figure, the horizonal rows contain genetic close relatives, while the vertical columns show geographic co-occurence. The archetypal Müllerian mimics are H. melpomene and H. erato, which look very similar despite coming from distant lineages. The authors note that the Helioconius genus has hundreds of different wing pattern races and species. So they have helpfully lined up the various mimics that co-habit but arise from different lineages and thus presumably have converged to similar wing patterns from different ones originally. These are the butterflies they use to ask the question: what are the gene(s) responsible for this variation and convergence/mimicry?

A great deal of past genetics had already pointed to one large genomic region responsible for red wing variants in this genus. The authors drilled down further by using high-tech methods to measure the RNA expression from regularly-spaced 60 base pair segments throughout that ~500,000 base pair suspect genome region. The RNA was prepared from dissected pieces of wing, comparing gene expression in red-colored pieces to that in green or black pieces. Only one location spanning about 15,000 base pairs correlated in its expression closely with the observed color variation, surrounding a gene called "optix".

As one can tell from the name, this gene was already known for its role in eye development in flies. Indeed, earlier researchers found that "Ectopic expression of optix leads to the formation of ectopic eyes suggesting that optix has important functions in eye development." No kidding! "Ectopic" meaning that they engineered expression of the gene in novel places, and - holy moly! - saw eyes develop in those places.

Back to wings.. the authors then looked at full-wing patterns of expression of the optix gene, and indeed it seems to closely presage the appearance of red color, such as in these images:

Expression of optix in 72 hour pupal wings (blue patterns), compared with adult wings of the same species.

The authors also looked at the genetics of optix in more detail and found that not only was there high correlation, but there was complete correlation between the alleles of optix and the resulting wing patterns, using hybrids of various races, indicating that optix is not just a downstream reflection of some other patterning component, but that it drives the red patterning by its location of expression.

Now the interesting part was that they sequenced the optix gene from seven of their Heliconius species, and the protein code was identical in each of them. Twenty million years of evolutionary divergence hadn't made any difference. The authors thus deduce that the genetic variation at this optix locus all happens in the surrounding regulatory regions of the DNA, not the protein coding areas. And this makes sense if the function of the protein has remained the same - make red pigmented areas on the wing (or make eyes, in other settings) - while its deployment in space across the wing has varied with the evolutionary needs of the moment.

They state "optix provides a compelling example of a gene that drives adaptation because its various alleles are regulatory variants that have pronounced effects on complex large-scale patterns." Unfortunately, they have not yet found those regulatory regions. Someone's grant and future work surely hangs in the balance. But as noted above, these regions and their variants are sure to be small, modular, dispersed, and hard to detect, since they exist at the edge of efficacy; bordering on random noise, in a DNA sequence sense.

Control is the key. Just as electronics and computer science quickly gave rise to information theory and cybernetics, and our financial and political worlds depend on people knowing what they are doing and having effective management processes in place, (ahem!), biology too is drenched with management issues. The human genome has half the number of genes that soybean does.. so to paraphrase, it isn't how many you have, but how you use them.

• Mars, Venus, and evolution.
• The invisible hand, red in tooth and claw. Also inefficient and counter-productive.
• BofA deathwatch ... and here.
• Euro meltdown/deathwatch.
• Fed reform watch, from the left.
• Who is the debt-iest president?
• On cronyism, regulation, and zombie banks. Also, they own everything...
• Democracy enters its death-thoes.
• Economics quote of the week, from Bill Mitchell, that China knows what it is doing, economically:

"So the graph highlighted in the early stages of the crisis the importance of very large fiscal interventions. My Chinese contacts informed me that at the time there was no discussion over there about the country drowning in debt or that the government was going to “run out of money”. These ideas that crippled the recovery in the West were not allowed to germinate in China."

• Occupy Marin at 12 noon- be there .. at the square.

A Better Retirement

A modest proposal- cancel all retirement plans.

The US retirement system is a mess. It is grossly unfair, in that employers can choose whether to offer retirement benefits or not, with employees not able to say much about it. Whole fields of employment may have defined pensions or their miserable cousin, the 401K, or nothing, with little rhyme or reason. Workers unwittingly enter fields that either do or don't offer retirement benefits, for all sorts of unrelated reasons of interest and talent, and wind up forty years later either made in the shade, or dumpster diving. We need a better way.

Employers also are mistreated by the current system. Some misers offer the stingiest 401K (no, or token matching), while others offer generous defined benefits. The latter can be destroyed by their pension obligations if they undergo contraction in the ever-changing business landscape, rendering them disasterously uncompetitive against younger companies without large pools of retirees. Among 401K plans, the degree of matching is highly variable, presumably a gauge of labor power in that company or industry, with results that only come out in the wash when the worker is later hung out on the line.

This hidden part of pay packages should, like health insurance under the Obama reforms, be made more uniform, and also be brought into the light by a few fundamental reforms.

First would be to cancel all non-Social Security retirement plans offered in the US, whether by private or public entities. Retirement is not a job for the workplace. Instead, Social Security should be doubled, to provide a uniform and stable base to the retirement of every working American. Despite all the scare stories, there is plenty of scope to beef up Social Security, by raising the cap of income levels that are taxed, and increasing the tax rate.

Second would be to eliminate the employer role in 401K plans. If a company wants to pay employees more, it should put that in the top line of salary, while the employee takes responsibility for the saving, the investments, and the tax deduction. All employees should be treated equally, not given more or less money based on whether they wish to save. Employees would still be able, however, to get their desired savings automatically deducted from their paychecks. The switch would by law put the money previously hidden in retirement benefits into the employee's top-line pay.

For instance, an empoyee might decide to save 10% of income automatically from her paycheck, and have it sent to a specified investment account. Her company would pay her the extra 10% that it previously paid in matching 401K contributions. The employee would take over the tax benefits, being allowed up to $20,000 of annual income to be counted as pre-tax toward this 401K/IRA. The government would offer all workers a social-security-grade account to invest these savings, (as inflation-protected bonds), in case they don't want to gamble it at the Wall street casino, and might also insure special bank savings/CD accounts if desired.

All this would go a long way towards decoupling retirement from the corporations and other institutions we work for. They don't want to worry about our retirement- they have better things to do. They have also been willing to underfund and raid these retirement accounts. Retirement is just too important (and far too long-term) to leave to employers.

The paternalistic model of employment needs to be put out of its misery, instead of penalizing those employers with moral scruples. Companies deserve a level playing field where they compete on their productivity, and attract workers based on transparent offers of compensation. Such reforms will also promote workplace mobility, lowering the need for workers to wait out bad employment situations for their promised retirement. The various fiascos of early retirement programs (allowing retirement at 55, even 50) would no longer be an issue, since no one would get defined benefits that could be arbitrarily granted and started at early times.

Lastly, this proposal would also resolve the public pension crisis, which is truly dire. As investment returns head downwards in our Japan-decade, the extravagant promises made to public employees by various well-meaning but undisciplined public entities have become unsustainable, hollowing out municipal and state public services. This albatross of needs to be cut from our necks by clawing back promises that were so rashly, and sometimes corruptly, made. These costs should be transparent on the top line of salary, not in the sticker shock of hidden crises bequethed to future generations. Public employers need to get out of the retirement business as soon as possible, and into a fair, transparent, transportable, worker-centered system.

• Companies raid the retirement cookie jar.
• Retirement funds speculate in the current bubble- commodities.
• Inequality is a fundamental, long-term problem.
• And it is high time to fight back.
• For the GOP's part, they will stop at nothing to do nothing.
• Corruption- rampant on both sides.
• Green- it's time, it's right, and it's economical.
• Dennis Ritchie- even more influential in computers than you-know-who.
• The Afghan peace deal is a delusion.
• Further Afghan commentary from a contractor on the ground.
• "God can see it."
• Reich helps out OWS with a rundown of lies in the class war.
• OWS poster show.
• Economic quote of the week, from Robert Skidelsky:

In the US case, adjustment will require a break with a credit-fuelled economy, which is the only way American capitalism has of dealing with the vast inequalities of wealth and income that it has created by outsourcing most of its manufacturing to low-wage countries. There is little sign, however, of the US being willing to rethink its version of capitalism.

Evolved to blog

Is our reason good for thinking, or good for arguing?

Recent podcasts featured two researchers who propose a novel idea about the point of human reasoning. Their proposition is that it evolved not to reason silently to ourselves, but to support our side in arguments. (Hugo Mercier, on point of inquiry; Dan Sperber on philosophy bites.)

Acting in the world, we generally don't resort to pen and paper to work out complex trains of thought or future action. We go with our gut, and trust to our instincts. We also go by painstakingly cultivated cultural norms and other social frameworks, virtually all of which are implicit, not to say unconscious. It is only in the modern world that we have engineers working out complicated tasks by mathematical means, or management gurus leading by microsoft "project", for what that is worth.

A theme in recent shopping research is that the more we obsess about a decision, and the more we make lists of pros and cons, the less well the decision goes. It is another case of our unconscious guiding us very well through the vageries of life, while reason just can't keep up with the huge amount of information involved.

Our reason, when we choose to employ it, also has characteristic defects. We use it to rationalize existing preferences more than to lead us to new conclusions. We suffer from confirmation bias, which helps us (blindly) feel good about past decisions. We use it to criticize the positions of others relentlessly, with far more skepticism than we would ever train onto our own core ideas.

So what is its point? If reason is so biased and rarely used, why have it at all? Hugo Mercier thinks we reason to argue- it is a social skill far more than a solitary one. This hearkens back to the core pursuits of the ancients, one of which was rhetoric, a sadly abused discipline in our current politics. The citizen gathering, shura, or agora was where public policy was made, with momentous consequences for everyone in the society. Wars were begun, diplomats heard, crimes judged. This was where common action was commenced- that essential function of being human.

Today, through the magic of modern media, our attention spans have declined to soundbites, horseraces, gaffes, and gotchas, rendering reason in the public sphere virtually invisible. We are left with the vote as the final refuge of public will, virtually naked in its tattered clothing of discussion and debate, exercised as a pure, though often ignorant, expression of private interest, rather than public spirit.

Sorry to digress.. so, does arguing and public reason lead to better results? Sperber and Mercier argue that it does (if not on certain cable channels). This is mostly clearly seen in the scientific culture, where pet theories and self-serving authorities are raked over the coals of public critique, peer review, and independent confirmation. It is the public nature of science that is key to its success. Even lone geniuses like Newton and Eistein had their bad, even crackpot ideas, (alchemy in the case of Newton), judged and flushed down the drain of "irreproducible results".

Other animals do not reason together- it is a uniquely human activity as far as we know. Most animals reason implicitly, individually, and unconsciously, with only a few (perhaps jays, crows, higher mammals) able to reason their way around the most elementary problems in a way that appears strongly conscious. So this conscious reasoning capacity is a very recent layer atop the much more powerful unconscious systems that keep us alive and going most of the time.

A leading theory for human intelligence posits that it was mostly selected for its social virtues and attractiveness to mates. Language is of course a primary factor in our heightened consciousness and reasoning ability, to the point that we often reason privately by talking to ourselves or writing, (or doing math), to "bring out" thoughts that otherwise are inarticulate, unformed, or absent. The nexus between language and reasoning (and the other human virtues of art and imagination) seems very strong, supporting an interactive theory of how and why we reason.

Nothing turns on one's reasoning powers like a good argument. Our assumptions are questioned, our interests opposed, and in turn we call up latent resources of rhetoric and rationalization. The true target is typically onlookers in the disinterested middle who may lack preformed personal committment. It may be possible, ideally, to exhibit such a compelling argument that even those directly opposing one's argument must recognize its validity.

In my blogging travels, I have to say that such experiences are quite rare, especially in the area of religion where the most devout inaccessibility to reason prevails, whether public or private. Perhaps the ability to change one's mind needs to be better appreciated and cultivated in our society, particularly in our politics.

• Bad loans- who is at fault?
• Bad banks... mark-to-make-believe.
• Warning- patriarchy at work.
• Evil, finally vanquished.
• Yet in Koch industries, it somehow persists.
• Stiglitz on the need for lots of public spending.
• Plastics, really vanquished.
• Even China can't really stand Pakistan's duplicity.
• OWS slogan of the week: "Tax the psychopaths".
• Economics quote of the week, from Bill Mitchell, writing about the fundamental issue of economic distribution:

"In the past, the dilemma of capitalism was that the firms had to keep real wages growing in line with productivity to ensure that the consumption goods produced were sold. But in the lead up to the crisis, capital found a new way to accomplish this which allowed them to suppress real wages growth and pocket increasing shares of the national income produced as profits. Along the way, this munificence also manifested as the ridiculous executive pay deals and Wall Street gambling that we read about constantly over the last decade or so and ultimately blew up in our faces. 

The trick was found in the rise of “financial engineering” which pushed ever increasing debt onto the household sector. The capitalists found that they could sustain purchasing power and receive a bonus along the way in the form of interest payments. This seemed to be a much better strategy than paying higher real wages."

What a REAL debt crisis looks like

Greece is in dire straights. We are not.

Economic discussion in the US is appallingly primitive. Boehner says that the federal debt "is the real jobs killer". This is taken seriously, and he continues to be invited to talk shows to spread his economic wisdom. No one is there to say that he is lying.

What does a debt crisis really look like? It looks like Greece, which is on the verge of exiting the Euro and defaulting on its Euro debts [Ed.- This may have happened already by publication]. Greece does not print its Euros, but has to borrow (or beg) Euros to cover its deficits.

It is in the same position as a Lehman or other company that borrows the state currency of issue from private lenders, who only buy the debt on free market terms- i.e. dependent on the perceived risk of default and insolvency. Last I heard, Greece was facing interest rates of 25%- truly astronomical and already a functional form of default. Recently, the central Euro bank extended Greece several extra emergency loans, but this was just putting off the inevitable, since the fundamental rules were not changed.

How do we look in comparison? The US government has unlimited dollars, so we are never subject to insolvency risk (with the exception of political or policy idiocy, where our leaders decide to withold dollars and lead us over a cliff). We face the different risk of inflation, if more dollars are printed than the economic system can handle. We definitely faced inflation through the seventies, after a binge of social and military spending in the preceding decade. But now? Now we are facing deflation, and all the work of the Fed to raise the "money supply" has lain idle as unlent bank reserves, awaiting a revival of animal spirits.

So inflation is telling us that the US federal deficit is not a problem at all, let alone a jobs killer. Indeed, the surest way to create more jobs is to fund them directly by government spending (with or without higher debt), killing two birds with one stone- raising employment, and also raising the perceived inflation target that will discourage passive investments, encourage active investments, and shrink fixed debt burdens.

The Republican economic rhetoric has become ever more confident and shrill as its snow job on the American public has gained traction. Surely its CEO supporters think that high taxes are hurting them, that government regulation is hurting them, and that labor unionization is hurting them. But that is not why they are not hiring. They are not hiring for lack of business. Macroeconomics should never be left in the hands of businessmen- that only leads to depression.

The point of public policy is not the care and feeding of the plutocracy, but the care of the general public interest, especially that of the lower and middle classes, which have been so abused over the last decades.

To put our current unemployment situation into perspective, the Apollo space program employed about 400,000 people at its height. Now, with unemployment plus the rate of discouraged workers standing at about 16%, and a civilian labor force of about 154 million, this works out to 62 Apollo programs. Granted, not everyone who is unemployed is a rocket scientist. But truly mind-blowing amounts of talent and energy are lying wasted, a casualty of free markets that don't work, ideology based on lies, and a general failure of political and intellectual will. We are choosing decline in the US, not suffering it.

• Example of pure shilling.
• Long term decline is setting in.
• Skidelsky on indebtedness and Hayek.
• Egregious waste in the oil fields, and how to end it.
• Economics quote of the week Marriner Eccles, Chair of the Federal Reserve, 1933, via Bill Mitchell:

"We have a complete economic plant able to supply a superabundance of not only all of the necessities of our people, but the comforts and luxuries as well. Our problem, then, becomes one purely of distribution. This can only be brought about by providing purchasing power sufficiently adequate to enable the people to obtain the consumption goods which we, as a nation, are able to produce."

Mystics envy

Why do physicists keep getting mystical on us? A review of "The Tao of physics".

"The Tao of Physics" took the world by storm over three decades ago, leading to a mini-industry of East-West mind-melds and tortured theories of grand spiritual unification. Has anything resulted from this, or changed? No, I don't think either physics or mysticism has changed in its wake, though perhaps our cultural recognition of the universality of certain psychological tropes has increased. I happened across this book recently, and thought it might make enjoyable reading.

Fritjof Capra gives very nice introductions to the physics of his day, and also capsule summaries of the major Eastern spiritual traditions, especially Hinduism, Buddhism, and the somewhat complementary Chinese systems of Confucianism and Taoism. His technique is generally to mash up the most mystical-sounding quotes from leading physicists with the most physics-sounding quotes from various mystics. Naturally, the questions each are grappling with have some resemblence, in that they are highly mystifying. And each are thinking about deep aspects of time, space, matter, and change. So the Buddhist Ashvaghosha is thought to have said:

"Be it clearly understood that space is nothing but a mode of particularization and that it has not real existence of its own ... Space exists only in relation to our particularizing consciousness."

What can one make of this? Probably something along the lines of mind-over-matter, perhaps an extreme Platonic sort of conception that "reality" doesn't exist outside our minds, and that with enough mind-power, we can fundamentally alter our relation to reality, even reality itself.

When placed within a discussion of Einstein's relativity, (as it is), this doesn't really make a great deal of sense. Einstein didn't dispute the existence of space, indeed he created a mathematical system of unprecedented accuracy to describe it and its relations to time, light, and gravity. The nature of space in modern physics is certainly odd, since it serves as the matrix for gravitation's effects, and generates virtual particles all the time, especially in the vicinity of condensed forms of energy that are regular particles. There is far more to the nature of space than we currently appreciate.

So there is no denying that space is a strange beast, (among much else in the phantasmagoria of fundamental physics), but whether the mystics understand anything about it, rather than offering empty riddles, and perhaps taking some ultimately subjective view of all forms of reality in relation to their personal voyages of meditation ... is, frankly, doubtful. And so it goes through the book.

A typical problem is the enormously different standards of evidence demanded of the two fields. The mystics have only to make bald and piquant assertions (hopefully also agreeing with each other on some vague metaphorical plane) to be taken seriously. In contrast, physics hews to an empirical standard where theories can actually fail. For example, in the epilog, Capra bemoans that lack of unified theory of relativity and quantum phenomena, which continues to this day:

"At present there are two different kinds of 'quantum-relativistic' theories in particle physics that have been successful in different areas. ... A major problem that is still unsolved is the unification of quantum theory and general relativity ino a quantum theory of gravity. Although the recent development of 'supergravity' theories may represent a step towards solving this problem, no satisfactory theory has been found so far."

That is a remarkable statement that no mystic would ever make. Do we have a thorough understanding of reincarnation? Has it been "solved"? How could we ever tell? With such imaginary, ethereal ideas, it would be simply impolite to press for details or evidence.

Yet Capra has previously in the book pushed the analogy far, far beyond the breaking point:

"Anybody who wants to repeat an experiment in modern subatomic physics has to undergo many years of training. Only then will he or she be able to ask nature a specific question through the experiment and to understand the answer. Similarly, a deep mystical experience requires, generally, many years of training under an experienced master and, as in the scientific training, the dedicated time does not alone guarantee success. If the student is successful, however, he or she will be able to 'repeat the experiment'. The repeatability of the experience is, in fact, essential to every mystical training and is the very aim of the mystic's spiritual instruction."

But just what is being experienced here, what experimented with, and what found? These journeys are introspective, finding things that are already there, indeed finding mental contents and instructions in large part put there by the culture and the teachers. While the traditions may generate and carry great social and psychological wisdom from this focus on the mind, they are on a great navel-gazing merry-go-round that could not possibly develop insights into physics and cosmology. They are humanistic disciplines all the way down.

Most unfortunately, Capra spends the climactic chapters on a theory of the constituents of protons/neutrons, called S-matrix theory, which has since been carted off to the scap heap of failed science. It has been replaced by the quark theory, with its gluons and very well-worked out chromodynamics. This wasn't just a scientific blind alley, but also a mystical one, since S-matrix theory denied the very existence of particles like quarks, and led to inflated claims of consciousness being the royal road to conjuring the particles themselves:

"Such a theory of subatomic particles reflects the impossibility of separating the scientific observer from the observed phenomena, which has already been discussed in connection with quantum theory, in its most extreme form. It implies, ultimately, that the structures and phenomena we observe in nature are nothing but creations of our measuring and categorizing mind."

Note the subtle switch from the structures of phenomena, which may very well be functions of how we look at them, to the phenomena themselves. He goes on.. "The Eastern mystics tell us again and again that all things and events we perceive are creations of the mind, arising from a particular state of consciousness and dissolving again if this state is transcended."

And there is the basic problem, since if we know anything, (which itself is not a certainty, indeed, but what else do we have?), it is that we are not a dream and the world is real, both in its capacity to afflict us and in its vast beauty. Transcending it is a pipe dream, while escaping it is all too easy, through such means as drugs, meditation, philosophical day-dreaming, or death. Intellectual adventures are laudible, but only give us the reward of truth if they are disciplined by the usual mundane attention to logic and evidence.

• Roubini lays down the law on what must be done.
• An essay in religious guilt.
• Community decay is part of the middle class decline.
• Obama- change ain't coming from the top.
• Granholm on our public policy decline.
• Cartoons become reality: "... detonating an explosive device that was hidden in his turban."
• On licensing shoplifting.
• Economics quote of the week, from Bill Mitchell:

"... why the hell is the ECB prepared to bail out banks but not countries – with what are effectively unlimited low-cost loans? Similarly, why is the US Federal Reserve prepared to proved unlimited US dollar credit lines to Europe with no firm collateral? The words 'appease elites' creep in when I wonder about those questions and 'damn the unemployed'."
...
"Who is benefiting? In each of the nations which have engineered a major redistribution of national income away from wages towards profits, it is the elites who have usurped what growth has been achieved."

• Economics graph of the week, from Fed data:

Morning in America- consumer debt started to rise (light line),
and assets fall (dark line), in the early 1980s.

The Meme War

Reflections on a lost decade.

I am reluctant to add my drop to the flood of 9/11 commentary, but an article by George Packer got me thinking:

"The attacks of 9/11 were the biggest surprise in American history, and for the past ten years, we haven't stopped being surprised. The war on terror has had no discernible trajectory, and, unlike other military conflicts, it's almost impossible to define victory. You can't document the war's progress on a world map or chart it on a historical timetable in a way that makes any sense. A country used to a feeling of command and control has been whipsawed into a state of perpetual reaction, swinging wildly between passive fear and fevered, often thoughtless, activity, ata high cost to its self-confidence."

We used to fight wars of territory, or at least principle. But now we are in a psychological war of unusual depth and complexity. The "clash of civilizations" formulation is too grandiose, while the "war on terror" alternative is both vague, as noted by Packer, and solipsistic, as though we were making war on hobgoblins and nightmares.

Yes, some of us were terrorized. Many were and remain hurt. And yes, we reacted shamefully and stupidly. It is a story of a power bestriding the world after the collapse of its conventional adversaries, only to face internal strife, complacency, and needling from Lilliputian adversaries.

As the title indicates, I'd suggest that the meme concept is well-suited to this challenge. The militant Islamists may be few in number, but their approach has a long history, and enjoys many levels of cultural support. The ideological conflict is extremly deep-seated, with the US and Islam each drenched in world-historical missions with presumptions of purity and superiority.

The conflict is most pointed with Islam-centric countries like Iran, Saudi Arabia, and Pakistan; by turns resentful, hot-headed, duplicitous, bigoted, and mortified by their systemic weaknesses, including, except for the oil countries, poverty. Islam's global culture has long taken a back seat to the West, exchanging its status of colonizing foreign lands (like India) with the experience of being colonized. The West is now headed by the US's military, economic, and cultural dominance, and Islamic culture responded by becomming passive-aggressive; first against the Western outpost of Israel, and more recently against the US directly.

The broad culture proclaims Islam to be a religion of peace, even while jihad is spelled out with great specificity, and its bequest of a shrunken world empire is a matter of identity and pride. Revanchist mullahs preach of renewed dominance and empire, were their listeners only dedicated and pure enough in their religious devotion.

As Mao taught, revolutionaries swim in the river of the people. We may kill every member of Al Qaeda, but militant Islamism will go on, fed by an unending stream of fodder from the madrassas of Pakistan, taught by the Wahhabi mullahs of Saudi Arabia. It is a battle of ideas / ideologies / memes, far more than a battle of individuals or nations. An ideology that can routinely employ suicide bombers is more than a tactical adversary- it is the fruit of a much larger cultural tree.

Some of the meme dimensions that come to mind:

Power- Next to group identity, worship of power is one of humanity's very worst traits. The irony of Islamists complaining about the overweaning power of the US, while at the same time dancing over every victory of their own with pronouncements that the US is a paper tiger to be shortly swept into the dustbin of history, is pathetic, but not unprecedented. What are they talking about? They are talking about power.

Islam is more power-hungry and power-conscious than most religions, with a bloody political militarism in its scriptures and early history. One of its deepest cultural failings is that power is respected more than principle, implicitly legitimating one despotism after another. But the culture draws the line at infidels, who should never rule over Muslims, however powerful. Worship of power neatly takes second place to group identity.

But worship of power makes its absence felt so much more keenly, activating the deepest memes of honor and group in a quest for dominance, even when hopeless. Why aren't other small and weak countries chafing under the US thumb, like, say, Norway, or Gabon? Perhaps because they are not as power-obsessed and ideologically resentful in dreams of past & future glory.


Religion- While religion is the thread woven throughout this conflict, both explicitly and implicitly, the problem is not confined to crazy theologies and believers who are more or less devoted to wholly imaginary saviors, eschatologies, and prophecies. No, the specifics are more or less changeable memes- the Balkans exhibited the same fusion of group and religion but diversified among Catholicism, Islam, and Orthodox Christianity. The problem is how base human traits are egged on in a systematic way by the cultural structures of Islam- how its Arab inheritance of bigotry and honor re-expresses itself so persistently.

Compare Islam with Christianity and Buddhism, which together form a sort of spectrum of decreasingly violent religions. Each has its mystical, pacifist elements. The Sufis have done yoeman's work in reinterpreting Islam in pacifist, introspective ways, and are reviled for it. In contrast, mystical introspection forms the main path of Buddhism, with its occasional violence and other defects very much the exception. Christianity lies at the center, with a great profusion of both liberal and militaristic elements, drawing from a central wellspring of heavily conflicted teachings, combining some pacifism and positive ethics with a great deal of hellfire in both testaments, and power & war major themes in the old testament.


Democracy & Progress- Do they "hate us for our freedoms"? In way, yes, since the dominant power is free in a way that no lesser power is. We are free to bludgeon Islamic countries, while they are not free to do the reverse. Freedom and power are intimately entwined.

This contrast contributes to the many conspiricy theories that abound in the Islamic world, ascribing all manner of hidden influence to the US, even though the facts of the matter show that when we do consciously exert our power, such as in Iraq and Afghanistan, that power is a shockingly blunt instrument.

At any rate, there is more to US influence than pure power, and this is where our ideology of democracy, freedom, and progress comes into play. These memes are central to the "hearts and minds" operation by which the meme war will really be won or lost. The legitimacy of US power abroad hinges not on how much ammunition we have, but whether we truly support the interests and self-determination of other peoples. Most people want democracy, and though squaring democracy with Islam can be a challenge, Islamic countries such as Turkey show that democracy and progress in economic, human rights, and civic spheres go hand in hand.

So my take on the war is that the tide turned not with the death of OBL, but with the Arab spring and its thorough coverage on Al Jazeera. This showed the way forward for the Islamic world at large, under their own power, with the mostly helpful, and occasionally decisive, influence of the US in the background. Clearly, our next step should be to put Palestine on the same road to self-government and independence.

One hesitates to say it, but the more or less stable conclusions to the horrors of Iraq and Afghanistan are in some measure consistent with G. W. Bush's instinct to "shake things up" in the Middle East, though whether he retarded or speeded regional progress is hard to say. Perhaps our bravura show of incompetence disabused Muslim onlookers and especially intellectuals about the external origins of their various travails.


Consumerism- Along with all the positive memes from the West, of better political systems that fulfill Islamic goals even better than the Islamic formula does on its own, (i.e. more organized and legitimate ways to select leaders, leading to peaceful and effective government), is the more insidious influence of Western consumerism. The TV shows, the prosperity, the shameless commercialism and greed. All this is highly conflicting when viewed from the other end. People do individually want to live better, with more goods, education, and sanitary conditions. But do they have to give up their souls to get there?

Western consumerism is rather intensely anti-spiritual, not to mention amoral. It breaks down barriers of taste, propriety, and tradition. The spiritual equanimity and community of Islam is put at risk by its advance. Muslims look at the spiritual corruption of the Saudi royals, and must be deeply disturbed. This has the power to undo the political logic/meme of democracy in the balance of Western influence, or at least to inspire persistent and principled opposition.

Unfortunately, consumerism is such a natural and emergent property of democratic systems and their allied prosperity that there is little we can do to separate them or cancel one half of the equation. The best we can probably do is to tend to our own hearths and try not to lose sight of point of a free economic system, which is to afford useful work and decent living conditions to all its citizens, and in that way (if we are successful) to continue providing a positive cultural path, warts and all.

• Paul Berman on the meme war, and its resemblance to other utopian movements of the last century. (By subscription)
• On transcendence and redemption in history.
• Declinist rants, on oil and politics.
• A macro-view of our foreign policy. 
• Lakoff, on the meme-scape and the domestic battle for power. With commentary.
• Government- problem or solution?
• Who exactly is reforming education?
• "Strikingly, no other circumstance triggers a larger decline in well-being and mental health than involuntary joblessness. Only the death of a spouse compares."
• Inequality, poverty, and our economic future.
• Terrorist watch- at the post office.
• Economics quote of the week, from Bill Mitchell:

"The evil cycle of neo-liberalism is circular – the ideology inflicts damage which is then explained by there not being enough damage which then leads to policies which cause further damage which then is rationalised …. and so it goes. "

• Economics graph of the week, from Paul Krugman's blog:

How much inequality?

What is the optimal setting for economic inequality in a society?

Many utopias have foundered on the dream of egalitarianism. Communism promised equality, yet delivered the ultimate inequality- despotism. Nevertheless, we keep dreaming of egalitarian systems, because we originated in substantially egalitarian societies of the family, band, and tribe that predated the unimaginably vast forms of wealth and power possible today. People owned little more than they could carry, and relied on social networks within a very small hierarchy for insurance against their various reverses and calamities.

In the primitive setting, some social hierarchy is natural, though quite variable. Some cultures practiced matriarchy, and few could (or wished to) support chiefs or kings in any kind of lavish style. In Afghanistan today, the rural Pashtun culture carries on the typical practices of tribe / small-group leadership, which break up and coalesce continuously, along with exemplary hospitality, strong codes of honor, intense male domination, and uniformly impoverished conditions.

So our natural setting seems to be some relatively modest degree of inequality, little of which was economic, rather taking political and social forms. The diversity of primitive power systems is an indication of the various human temperaments and psychologies that will have great difficulty agreeing on a single optimal system in a huge culture such as our own. Thus we have constant debate, if not warfare, over visions of how much hierarchy, how much differentiation of power, how much inequality, is best.

The advent of democracy, equality before the law, human rights, and similar ideas dramatically curtailed the scope of raw social/political power. This enlightenment complex of ideas has been an enormous step up in our level of civilization, (if one favors egalitarianism), and perhaps in some way back towards our native state, as expressed in the formulation of "natural" rights. One wonders sometimes why libertarians, tea partiers, and other denizens of the far right don't frankly fight as much for inequality and freedom on the legal and political planes as they do so vociferously on the economic plane. For a return, in essence, to the Darwinian struggle in all its bloody dimensions.

The economic dimension remains the main battlefield of class and power, with inequality possible to levels undreamed of in any other aspect of social relations, outside the few remaining political dictatorships. Concentrations of economic power have grown immeasurably with the advent of storable wealth, with individuals amassing wealth equivalent to the GDP of small countries.

In primitive societies, great wealth creates obligations to share and distribute, it being generally perishable. In our society, wealth can be held indefinitely and compounded infinitely. Our current crisis is characterized by an unwillingness to spend, despite the  availability of veritable oceans of money (in corporations, in banks, and amongst the wealthy). The poor and middle class have lost spending power as they have lost income, employment, and credit, so this crisis, (if one views high unemployment and stagnant economic activity as a crisis), is fundamentally related to the unequal distribution of wealth and income.

Left to its own devices, the capitalist system creates ever greater inequality. Outside of boom times, such as during World War 2, there is always an army of unemployed that lowers wages. As living standards at the bottom are maintained at a minimal level to forestall riots, the political system is engineered to preserve the position of property and wealth, and the corporate system is turned into a club of cronies. This story has been repeated in countries all over the world, as the gains from technology and economic development have flowed into the pockets of the few.

This process is generally corrosive. Do the rich in the US sponsor great philanthropies and public works? The short answer is no- the greatest concentrations of wealth are captured by the financial elite who are the most psychopathically immoral and greedy of all. The accumulation of wealth has finally, in our specialized and advanced age, been severed from practically any human or civic virtue, so that its benefits lie sterile, behind gated compounds and in the clutches of people whose greatest ambition is to cheat the government of a few more pennies.

If they fail to invest their wealth in new enterprises- in the grand cycle of capitalism- then we may wait a very long time indeed for deliverance if we rely on the the invisible hand alone, in the current crisis.

---

Yet inequality remains the engine of capitalism, from the basic market proposition of finding the best deal, to the channelling of labor into the most productuve pursuits and the destruction of poorly run companies. Hayek was certainly correct that market mechanisms process some economic information far more efficiently and subtly than any explicit control mechanism could hope to. Inequality, even greed, is the invisible hand behind a good deal of what we see as excellence, efficiency and innovation.

But how much is enough? It is in some ways a psychological question- how much and what kinds of motivation do the various participants need to create that vibrant economy? I think psychology tells us that much less motivation in the form of money would suffice. Does a CEO need millions in compensation if she already has the reward of having scaled the ladder of success and gathered enormous corporate power? Not really. Only in the crony-ridden closet of executive compensation is it necessary (and possible) to embezzle vast sums from the shareholders in order to satisfy one's status aspirations vs the other CEOs on the block.

Other cultures have shown the way, such as Japan, the Scandinavian countries, and indeed the US of the 50's and 60's. In each case, either social norms or government policies such as high taxation keeps economic inequality much lower than it is in the US. Since social norms in the US are hopelessly out of whack, we need changes elsewhere to reign in economic inequality, and particularly to encourage accumulated wealth back into circulation where it can create jobs and generate income in a more egalitarian society.

For instance, I have suggested 100% estate taxation, and would also recommend a wide-spread financial transaction tax, in addition to more progressive taxation of income and reform of private retirement systems. The point is not to penalize anyone, but to counteract the corrosive wealth-concentrating effects of laissez-faire- one more effect among its many, many other defects that need to be regulated for the common good. For example, the financial industry generates diminishing, indeed negative, returns to general economic wellbeing the larger it gets, and especially the more "innovative" it gets. It needs to be reigned in substantially.

What about the bottom of the ladder? How much monetary motivation and thus inequality is required there? Clearly, economic motivation is essential to drive most people to take jobs and perform whatever services society deems useful. Left to their own devices, most people would pursue other interests of perhaps more cultural significance, (blogging?), but rarely of economic significance. The communists substituted, for the lash of economic necessity, raw state power, which turned out not to be much of an advance.

So conservatives are certainly correct that there is a risk to excessive egalitarianism / socialism which grants benefits to all without some mechanism of bending each person to common duties (i.e. the risk of free-riding). But there are significant caveats. First is to those who are not productive in any case, like the young. In a well-run society, children would be generously supported with public goods like health care, parks, day care, cultural enrichment, and free education to the highest levels. The point would be to work with parents to develop the most well-educated citizens, workers, artists ... persons, without reference to family income and class.

A second important caveat is that running the macro-economic system properly is a central job of the state. It is pointless as well as cruel to apply the lash of unemployment and poverty when there are no jobs to be had. Keynes and his school showed (and continue to show, in the economies cited above) that unemployment is a political matter that the state can remedy when it wishes. The fact that we have fallen into a period of learned helplessness in the US speaks to how thoroughly our putative democracy has been taken over by a callous ideology of capital at the expense of workers.

Specifically, in order to restore overall economic activity and thus jobs, the state needs to direct money from its various inert forms (savings, bank reserves, the Federal power to create money) to the lower end of the economic ladder, by whatever means necessary- conservation corps, public works, payroll tax holidays, helicopter drops, whatever.

In the end, both economic efficiency and morality argue for greater economic equality than we observe in the US today, though certainly not perfect equality. The most sclerotic economies around the world are the most unequal, with small coteries of the powerful feathering their own nests while the majority beg for crumbs. The most vibrant economies, like those of Northern Europe, are far more egalitarian, with high living standards across the board, high cultural attainment, and high happiness into the bargain.

We can do it. This is not rocket science. We can turn another page in humanity's ascent from Darwinism to civilization. We can find and maintain a middle way- a prosperous and humane way- between communism and plutocracy.

• A discussion of inequality and the withering middle class.
• The spiritual work of being out of work.
• Those super-paid American managers ... aren't that good, either.
• Who matters, in Washington?
• Stiglitz on our fatal 9/11 over-reaction.
• Krugman on exactly how not-big-enough the stimulus was. (Several trillion)
• Interesting notes on gold and gold-like monetary systems.
• "... protests are not approved in Islam no matter what injustices the ruler commits."
• Europe, melting down.