New monies for public purpose- an economic third way

Why is the same money used to buy toothpaste and political campaigns?

After the decline of the competing ideologies of the 19th & 20th centuries- colonialism, communism and socialism- nationalism and capitalism were left triumphant, alone and without an existential critique, other than the tribal, bitter opposition of Islamism. China is more capitalist than we are in many ways, with a pell-mell no-health-insurance, no-safety-net ethic of ruthless get-rich-ism.

Yet there is a great deal of unease in other quarters. Hatred of the US as the world exemplar of hyper-capitalism is widespread, if not for our wealth directly, then for the lack of taste with which we display it, and abuse it.

What other countries hate most about cultural invasion by the West is materialism .. the crass, amoral wastefulness, hedonism and concomitant lack of human values. The West has been given over to its greediest, basest elements rather than uplifted by their most introspective and spiritually inclined. God is dead, and the Market rules in its place.

These thoughts were sparked by a review of Vaclav Havel's career (incidentally also by a biography of Glenn Gould). Havel knew the stifling hand of totalitarian government, as well as its meaningless, hollow post-totalitarian variant. But for all his yearning to break free, he was quite ambivalent about the boons of the West. He was very much a spiritual atheist, an absurdist seeking meaning while leading the cultural evolution of Czechoslovakia; indeed to some extent, the entire West.

Many have dreamed of transcending the market, which mediates many of the brute realities of mundane existence. The Marxists drew on Hegel and some rather cracked economics to simply assert the historical inevitability of its end, replaced by a worker's paradise, then proceeded to make a royal mess of it. Other dreamers have sought to separate more circumscribed human values from the market, with mixed success. The enlightenement brought democracy and the novel currency of votes- one per person. We are still grappling with the question of whether votes can be bought with money (not terribly successfully, judging by the current political season).

The wealth of the West, established through the slow accumulation of technical mastery over the environment, (as well as supple modes of political organization), now enables a dramatically different relationship with markets and materialism in general. Food makes up only 7% of US household spending. Many of our other goods come from overseas, at far less cost than it would take us to make them. They are, in large part, free. With increasing mechanization / robotization, this trend will only increase, making necessities ever less significant shares of our budgets.

Yet GDP is ever-increasing, as we dollar-ize more of our lives, from birth to death and every interaction in between. On top of that, the more luxury-based our economic system becomes, the more unstable it is, prone to enormous diversion by financial gamblers, rentiers, and misappropriating agents like CEOs.

One of the dark comedies of our economic system is the quest for a "business model". Innovators who create phenomenal public services like Twitter are forced to the corrupting rack of advertising in order to "monetize" their users. Great reporters and news organizations dissolve before our eyes in the face of free media, bloggers, and the shameless propagandists of FOX news and the rest of the cable universe. The public interest goes begging because participation in the dollar economy requires making one's service precisely antithetical to the public interest in some critical way that generates ... the business model.

Thus I see a great need to carve out more spheres of non-monetary interaction- more currencies like that of the vote. Today, finance accounts for roughly 10% of GDP- to what end? So that we can gamble with our savings and pad the pockets of those entrusted with them? CEOs serve on each other's boards and compete in paying each other ever more ... because they can. Money increasingly reflects social relations and status rather than fundamental measures of productivity, let alone of personal worth. The mantra of "free markets" has blinded us to the their enormous defects, even in an ideal state. And blinded us to the essential nature of public goods and our rising capability to provide them.

Does our political system need to run on dollars and its attendant corruption? Does the media that conducts our public debates need to be owned by corporations and paid by advertising? Not really. One could imagine currencies like Facebook's "like" system replacing dollars to fund these and many other public services. Citizens would get equal amounts of them just like they get votes ... for being citizens. They would send them to media services or candidates they favor, perhaps electronically. This would resemble a school voucher system, only instead of being used to destroy an existing public service, it would be used to enhance a public service by insulating it from corruption and dramatically broadening its support base. Just imagine what public broadcasters could do if their funding reflected their actual listenership / viewership rather than just those guilted into parting with hard-earned salary money. What if the choice to contribute to a political candidate didn't mean going without essentials like food and medicine?

Similar special-purpose currencies could be used to support the arts, direct selected areas of public spending such as infrastructure, parks, and foreign aid, and support a full range of charities and non-profits. Substantial areas of our public lives could be more democratically directed by getting away from the current binary system of system of dollar-rule or legislative sausage-making. Some corporations could even remake themselves into public interest entities or utilities (such as software makers, perhaps), and tap into such forms of funding. The new currencies would be convertable at the point of use by the receiving organizations into dollars to pay their expenses, or in the case of political candidates, into the new media currency with which in turn to buy exposure.

Ideally, enough resources would be budgeted in each of these areas to render the use of actual dollars superfluous, while still permissible. Actual dollars would be (progressively) taxed out of the remaining economy sufficiently to make room for all this new democratically-directed spending. Such a "new economics" offers a way to foster high personal freedom and democratic principle while reforming corrupt practices, and furthering the public interest in many areas where it is badly or under-served today. It addresses some of the goals of the Occupy movement whose overriding critique is the reality of economic and especially political control / corruption by the 1%, which so starkly contrasts with the democratic principles we supposedly follow. It would represent an important step in our travels towards a truly democratic and public spirited national community.

• Economic transitions, from feudalism to capitalism, and on to post-capitalism.
• What do we perceive as fair?
• How do the 1% get there? It isn't pretty.
• What class warfare really looks like. Bloodless edition with chart.
• Introverts are OK ... better than OK!
• "Because, in my mind, that’s what addiction really is — people trying to blot out the pain of being human with chemicals that inevitably just make the pain even worse."
• The oceans are in miserable condition. Please don't eat seafood. Incidentally, the Earth is full.
• Mumbai is also full.
• Another problem with corporations- they support war.
• A small critique of finance and Krugman.
• Economics quote of the week, Ben Bernanke, testifying before Ron Paul:

"Nice to see you again, Dr. Paul."

This exchange was a sterling example of what makes a currency active. Ron Paul held up a silver coin that he claimed had held its value far better than our paper money, and was natural money- not a fiat currency that is fake in some way. Bernanke said that Paul was welcome to hold and exchange as much silver as he liked. Then Paul complained that he couldn't use silver to pay taxes and make other relevant transactions. It was an object lesson in what differentiates a state currency (fiat or otherwise, however virtual, paper, or "fake" it seems ) from a natural currency.

Terror Mouse!

Building a better fight-mouse through brain injections of genes.

Much of our economic and political discussions are sublimated social dominance psychology ... who "deserves" to stand higher on the totem pole, who deserves what pay, which class should rule, which cultural myth should guide us into the future. These are not technocratic issues, but questions of value embedded in our social instincts. Up till quite recently, we were under the impression that our lives needed to be run by the nobilities of blood and church. And status archetypes like princess, knight, and king- reflected in popular literature like the Harry Potter series- continue to structure our political and social systems. For example, the king-like office of president.

Obviously, all this is extremly ancient and perhaps unavoidable. All animals with any kind of social system also have a social hierarchy so that most of the time, internal conflict can be avoided and members can get on with the common goals for which the social system exists. This includes mice, which are the subject of a recent paper in Science from a lab which investigated the neurological basis of their dominance hierarchy.

The tests of status were simple. In a tube test, two mice are put into opposite ends of a one-lane tube, and the one who backs out is the dominant mouse. The mice have been trained to run to the end of such tubes to get some food, and apparently were occasionally prodded along with sticks so that they met at the middle before deciding which mouse would back out.

A second test used a natural behavior where in nests, one mouse typically chews down the whiskers of the other mice, becomming the "barber" mouse. Other tests included measurements of weight gain after food was put in a common area in limited amounts, a urine marking assay of territory size, and a sound assay, where dominant males call out ultrasonically to females with more enthusiasm. The tests all correlated with each other, leading to a coherent score of social rank.

Previous clues had directed these researchers to the medial prefrontal cortex (MPFC) as an area that shows hightened activity during dominance-related behavior. So they looked for signs of social rank in their mice in this area of the brain by slicing up their research subjects and looking for electrical activty (live slices) and various molecular signatures (dead slices).

They found that the electrical activity of randomly tested neurons in this brain region, upon chemical stimulation of glutamate receptors, was somewhat higher in dominant mice vs the lowest ranked mice. Likewise, the c-Fos gene, which gets expressed after brain activity and is used as a marker for active brain regions, shows higher mRNA levels in higher-ranking mice (below). One wouldn't necessarily assume that the brains of dominant animals are more active than lower-ranking ones, but in any case, they would have different profiles of activity, so non-dominant mice may have higher activity elsewhere in the brain.

cFos gene expression in MPFC area of brain slices reflects social dominance.

Now for the exciting part. The researchers decided to test this correlation of brain activity with social status by direct action: increasing or decreasing glutamate receptor activity in the brains of living mice by injected gene therapy. Glutamate-sensitive neurons can be "tuned" by expression of proteins Ras or Rap,  which have opposite effects in the signalling cascade involved in recycling the synaptic vesicles that contain neurotransmitters. So the researchers injected the MPFC with a virus expressing either of these proteins. The affected neurons showed strong effects, with 179% of normal activity when infected by Ras-expressing virus, and 71% of normal activity when infected with Rap-expressing virus.

"Mice infected with the Ras virus moved upward in rank, starting a easrly as 12 hours after viral injection. In contrast, mice infected with the Rap virus moved down in rank. Infection of virus expression green fluorescent protein [GFP] alone did not result in any rank shift."

The average rank shift was only one unit, out of three possible units of rank from one end of the status scale to the other. So this treatment alone is not quite sufficient to produce the über-mouse. The treatment is also incredibly crude, perhaps providing an "injection" of confidence or slight craziness.

A small brain injection might do wonders for one's social status, if one wants to go beyond the steroid, testosterone and other injections people use currently. Less facetiously, it is another example of the brain basis of our thoughts, feelings, and behaviors.

• MPFC and the Self.
• Religion, politics, Iran, and cuneiform.
• GOP primary goes completely wingnutty. Exactly who has the "phony theology"?
• More on GOP thought processes ... the awesome power of rationalization.
• Incidentally, the GOP also has sex on the brain.
• Bill Black keeps hammering on fraudulent banking- the elephant in the room.
• Economics, environment, and coal's latest excuses.
• Is hating the Taliban enough to keep it at bay? Sadly, probably not.
• The stimulus should have been 1.8 trillion.
• A fascinating view of our recent debt history.
• Too Big to Fail banks hold $700 trillion gun to each other's heads, in gambling "contracts".
• Discursive overview of modern monetary theory, money, banking, the Euro, and power.
• Our financial system is run by psychopaths.
• Economics quote of the week, by Adam Smith, courtesy Robert Skidelsky.

"The third and last duty of the sovereign....is that of erecting and maintaining those public institutions and those public works, which though they may be in the highest degree advantageous to a great society, are, however, of such a nature, that the profit could never repay the expense to any individual, or small number of individuals; and which it, therefore, cannot be expected that any individual, or small number of individuals, should erect or maintain."

Nowhere to hide- the megafauna refuge in Tibet

Where did wooly mammoths and wooly rhinoceri hang out in between ice ages?

Earth was host to a magnificent ecosystem thousands of year ago- movingly drawn on the walls of Chauvet and other caves by our artistic ancestors. Wooly mammoths, wooly rhinoceri, aurochs, giant rhinoceri, and cave lions, among others. The ice ages ebbed and flowed, and these animals with them, until humans gave them nowhere to hide and upended the ages-old ecological order. Where did these animals stay during the warm periods? Where would they be now?

Wooly mammoths and rinoceri seem to have evolved in step with this era of ice ages, which began about 2.6 million years ago and rolled in 100,000 year cycles through the last million years. 100,000 years isn't enough time to evolve a wooly rhinocerous, but 3 million years is. A recent paper in Science tells of a new fossil found in Tibet of a proto-wooly rhinocerous from 3.7 million years ago, indicating that Tibet was the birthplace of at least some of the cold-adapted megafauna that was so successful during the ice ages. It notes also that the outer margins of Tibet where part of the known range of wooly rhinos, indicating that this area served as its refuge during warmer interglacial periods as well.

Elasmotherium, the giant rhinocerous.

It is worth noting that the Himalayas are thought to have begun exhibiting alpine conditions due to plate tectonics only from about 3 million years ago, contrary to earlier estimates, and closely consistent with the current paper's estimates. At any rate, once cold-adapted megafauna developed in Tibet, they found huge areas of the northern hemisphere hospitable during the ice ages, and were even able to meander over to North America. For instance, our bison diverged from the Tibeten yak only 2 million years ago.

How wonderful it would be to come upon these animals today. But of course Tibet has also been colonized by humans- the people of Tibet, who themselves became somwhat biologically adapted to the cold and altitude, and doubtless extirpated the rhinos, who with their formidable horns were so well-defended against all other predators.

Of the not-so-mega fauna that remain, do they have a chance? If we are not killing them directly, are we giving them wide landscapes to flourish in? Are we giving them millions of years to adapt to the climate change we are bringing on; even thousands?

• Jobs and redistribution are required.
• On why the unemployed must be made miserable, whoever may be at fault.
• Printing money is indicated.
• Iran, still in ferment.
• Occupy, taking it to the citadels of ... regulation.
• The climate change denial industry- corrupt, corrupting, and paid for by you-know-who.

Star Wars and the hero's quest

The Star Wars mashup as a way to psychological, even spiritual, health.

I found the recent release of a full-length mashup version of Star Wars, composed of countless (actually, 473) clips from fan reenactments and animations, endlessly fascinating. As the Salon article that brought it to my attention mentions, it is a gloriously expressive outpouring of love. But is it healthy?

From the very first, Star Wars was an extraordinarily cheesy Hero tale. A journey by the fair-haired Luke from Potter-esque anonymity to savior of the galaxy, with a bit of magic (force) tossed in at highly convenient plot points, with luck and coincidence playing starring roles. Then the franchise went steadily downhill, but I won't go there!

As a fan of Jung, I respect the intricacies of the archetypal theory that surrounds this sort of tale, which goes into enormous detail about the typical hero, the helpers in the quest, the father-figure, the role of the underworld and its tests, the initiation ritual, the magic tools, and so forth. All this has its role. But one thing missing in the theory is its point ... why are these hero tales so gripping and perennial? Why do they emerge in every time and cuture? Joseph Campbell tries to explain it in his classic, the Hero with 1000 faces:

"The passage of the mythological hero ... fundamentally it is inward- into depths where obscure resistances are overcome, and long lost, forgotten powers are revivified, to be made available for the transfiguration of the world. This deed accomplished, life no longer suffers hopelessly under the terrible mutilations of ubiquitous disaster, battered by time, hideous throughout space, but with its horror visible still, its cries of anguish still tumultuous, it becomes penetrated by an all-suffusing love, and a knowledge of its own unconquered power." ...

"What, now, is the result of the miraculous passage and return? 

The battlefield is symbolic of the field of life, where every creature lives on the death of another. A realization of the inevitable guilt of life may so sicken the heart that, like Hamlet or Arjuna, one may refuse to go on with it. On the other hand, like most of the rest of us, one may invent a false, finally unjustified, image of oneself as an exceptional phenomenon in the world, not guilty as the others are, but justified in one's inevitable sinning because one represents the good. Such self-righteousness leads to a misunderstanding, not only of oneself but of the nature of both man and the cosmos. The goal of the myth is to dispel the need for such life ignorance by effecting a reconciliation of the individual consciousness with the universal will. And this is effected through a realization of the true relationship of the passing phenomena of time to the imperishable life that lives and dies in all."

In the spirit of simplification, what I would focus on is that the Hero tale, simply and plainly, is a way to model success. As Reagan said, nothing succeeds like success, and the psychological enactment of success- of reading the happy fairy tale, of cheering for a winning team, of watching the murder being solved on CSI, reading the superman comic book, and yes, wielding one's tin-foil light-saber, is more powerful than any Tony Robbins motivational pablum. Sure, actual success is the sweetest of all, but that is a rare experience, and anyway, we only know what to do with it and how to value it through the strenuous modelling of a childhood steeped in the hero tale (including Cindarella tales).

We are all by the nature of reality and life bound by countless fetters. Biological, physical, environmental, and above all social conditions hem us in on all sides. Life is an endless series of problems to be solved and desires to be satisfied in the teeth of implacable reality- even quite active competition & opposition. The mantra of "freedom" that rings through our political discourse is far from an existential promise, but a woefully limited proposition, relative only to our ur-political condition of total Hobbesian depotism. Now, we face, in political terms merely a tyranny of the majority, (or a majority of the money), moderated by a few constitutional rights, more or less observed.

Thus the sweetness and rarity of true success, where some magical tool or insight arises, perhaps spontaneously from the same place that is so insistent on the enactment of hero tales ... the unconscious, allowing us to cut an existential Gordian knot. While obedience to the ambient social norms may suffice for a "normal", discontented slave-like existence, we all aspire higher. Perhaps tragically, but also inevitably. The hero tale is the spur, the offering of hope, and the psychological preparation for that real quest.

How best to experience it? Clearly one gets out what one puts into it, psychologically speaking. Worst of all is the passive viewing experience, supine in front of a TV or theater screen. Next perhaps is the radio format, demanding substantially more mental attention and imagination. On par would be a live reading by a friend or parent, even if there are a few pictures involved. Somewhere in there would also come the solitary reading experience, which makes some imaginative demands, but is also a bit slow and dry. How about actual re-enactment and play? Here we get to some serious interactivity, intensity, mental involvement, and imagination. Indeed, the more crude the props and implements, the higher the imaginative involvement.

Lastly of course is actually carrying out a heroic experience, engaging in the hard work involved, the practice, the training, the schooling needed to be a professional musician, or join seal team 6, or cure cancer. But that takes forever!

One can easily imagine religion arising out of this process of devising and telling heroic tales. Adults and children alike thrive on such sagas. Perhaps one saga (Homer's, the Ramayana, the Mosaic tale, etc.) captures the mood and vitality of a culture particularly well, with close scrapes, awesome enemies, deep poetry, and triumphant successes. Perhaps, in its customary recognition of the overwhelming importance of the hero's unique inner resources (i.e. the unconscious), its heroes gain magical assistance or are themselves gods under mundane cover.

Perhaps this story becomes so psychologically compelling or ritualized in re-enactment that it turns from story into fact- a "believed" religious narrative. Some other ingredients may be added, such as a back-story about how the world is created, and some more or less rationalized doctrines about how the "super" powers and "super"-beings relate to each other to satisfy the more cerebral believers. But all these things can be added later on rather easily, as George Lucas has labored voluminously (if relatively vainly) to show. (L. Ron Hubbard had a great deal more success!)

And what about humor? In striking contrast to a story that evolves into religion, the Star Wars mashup is as much spoof as homage, yet is none the less loving for that. The original film used plenty of humor, particularly from C3PO, and the comically over-drawn villains. There are fine lines between modelling success and being successful, delicious in their plasticity. Also, fine lines between profundity and platitude, between bathos and tragedy, between meaningful myth and camp. Humor seems to signify our knowledge of those lines, our mutual conspiracy to experience greatness while wearing collanders on our heads. It also, in its better tenors, affirms existential hope over the various tragic means and ends of human life.

In this connection, Campbell tried to resurrect an ancient sense of comedy, far different from what is customary today:

"We are not disposed to assign to comedy the high rank of tragedy. Comedy as satire is acceptable, as fun it is a pleasant haven of escape, but the fairy tale of happiness ever after can not be taken seriously; it belongs to the never-never land of childhood, which is protected from the realities that will become terribly known soon enough; just as the myth of heaven ever after is for the old, whose lives are behind them and whose hearts have to be readied for the last portal of the transit into night - which sober, modern, Occidental judgement is founded on a total misunderstanding of the realities depicted in the fairy tale, the myth, and the divine comedies of redemption. These, in the ancient world, were regarded as of a higher rank than tragedy, of a deeper truth, of a more difficult realization, of a sounder structure, and of a revelation more complete. 

The happy ending of the fairy tale, the myth, and the divine comedy of the soul, is to be read, not as a contradiction, but as a transcendence of the universal tragedy of man. The objective world remains what it was, but, because of a shift of emphasis within the subject, is beheld as though transformed. ... Tragedy is the shattering of the forms and of our attachment to the forms; comedy, the wild and careless, inexhaustible joy of life invincible.
...
It is the business of mythology proper, and of the fairy tale, to reveal the specific dangers and techniques of the dark interior way from tragedy to comedy. Hence the incidents are fantastic and 'unreal': they represent psychological, not physical, triumphs."

• Hope, confidence, and togetherness- also the currency of mega-religion.
• Inside the new hate.. or is it the same old hate?
• Our government is corrupt.
• Our media is corrupt too.
• What we need in a new political/economic narrative.
• Brief talk on place cells in the brain.
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• On the other hand, the Greek crisis generates even more financial innovation.
• The CBC's look at Occupy concludes, with a rousing call to democratize capital and downsize the FIRE sector (segment 3, minute 47 to end).
• Economics quote, from Robert Solow, via Bill Mitchell, speaking of conventional micro-based macroeconomic modeling approaches (dynamic stochastic general equilibrium, or DSGE):

"An obvious example is that the DSGE story has no real room for unemployment of the kind we see most of the time, and especially now: unemployment that is pure waste. There are competent workers, willing to work at the prevailing wage or even a bit less, but the potential job is stymied by a market failure. The economy is unable to organize a win-win situation that is apparently there for the taking. This sort of outcome is incompatible with the notion that the economy is in rational pursuit of an intelligible goal. The only way that DSGE and related models can cope with unemployment is to make it somehow voluntary, a choice of current leisure or a desire to retain some kind of flexibility for the future or something like that. But this is exactly the sort of explanation that does not pass the smell test."

Neurons poised in meditation

Cortical neurons show exquisite balance between inhibitory and excitatory inputs, typically summing to zero.


Life wouldn't be quite as sweet without homeostatic mechanisms. From blood chemistry to the hedonic treadmill, our biology keeps things stable so we can sail through life on an even keel. As yet we have only a glimmer of appreciation for the many homeostatic mechanisms in the brain- for mood, activity, weight, temperature, introversion, sleep, and many more. While people differ in their settings for many of these systems, those settings tend to be extremely stable through life.

It's gradually become apparent that the basic workings of the brain rely on another homeostatic mechanism on the level of neurons and neural networks. The ability to shift attention, superimposed on a baseline brain rhythm / hum, indicates that the baseline condition of much of the brain is quasi-stability. Such shifts are detected in functional brain scanning as metabolic variations, (higher blood flow, among other signs), so there is real physiological change that follows what subjectively seems like effortless shifts of mental state.

So, most of the brain operates on a knife's edge / default / zero state which can be roped into active, attentive, ever-changing coalitions of neurons from all over the cortex to bring us the many and various conditions of thought, sensation, vision, emotional engagement, planning, etc. that are well-known to engage various specific parts of the brain.

For this important property of nerve cells in the brain, a recent paper provides a cellular rationale, which is that all information-carrying neurons in the brain typically get automatically balanced inhibitory and excitatory inputs through a feedback mechanism to inhibitory synapses. The idea is that each neuron connects as much to inhibitory interneurons as to excitatory information-carrying neurons, and those inhibitory neurons adjust their outputs over time in response to what is going on in the target cell so that its activity stays mostly quiescent. Most neurons thus spend most of their time in a calm, meditative state.

The paper leads with simulation experiments, and follows with supporting evidence from actual cells and networks. The hypothesis appears to go substantially beyond current knowledge, where inhibitory neurons are a well known component, but not a functionally well-understood part of the neural / cognitive landscape. The hypothesis provides a rationale, based on a relatively mindless cellular mechanism, for why the brain doesn't explode with activity, but rather keeps humming within relatively tight bounds, and as noted above, with the sort of knife-edge stability that lets us think with some degree of both focus and roving attention.

The story starts with Donald Hebb, who came up with perhaps the key insight to how neurons can learn as a network. The rule is commonly expressed as "cells that fire together wire together". Which is to say that in a neural network of cells, those that fire coincidently (one to the next) within some window of time (say <10 milliseconds), engage in a molecular process that strengthens their synaptic connections so that in the future, the downstream cell responds more strongly to firing of that upstream cell.

This basically mechanical process is the soul of associative learning, where a bell, say, is associated with the appearance of food. But lest everything become associated with everything else, countervailing mechanisms are needed to inhibit those connections that are not active, and keep overall activity at a low baseline so that only unusual occurences create signals. In this general respect, the role of inhibitory neurons (which generally use the neurotransmitter GABA in their synapses, in contrast to excitatory neurons that typically use glutamate) has been appreciated for some time.

The present authors take the extra step of simulating in detail specific rules of Hebbian learning and inhibition that seem to accurately account not only for the actual sensitivity of cortical neurons but, on a larger scale, for the operation of memory as an example of how all this adds up to collective neuronal & brain function.

The secret is a rule that generates detailed balance of excitatory and inhibitory inputs over time to each cell, leading the downstream (target) neuron to be mostly quiescent (also called by the authors asynchronous irregular activity, or AI). This rule operates on inhibitory interneurons that get the same upstream signals as excitatory neurons, adjusting their synaptic strengths towards the common downstream neuron.

A: Diagram of the inhibitory neuron (light gray), getting excitatory inputs and acting in parallel with excitatory stimulation to a balanced target (green). B: Diagram of simulations, where 25 inhibitory and 100 excitatory neurons with distinct signal trains, feed into a target neuron. C: Relation of the learning rule with time. Only coincident firing (inhibitory and target neurons) within ~20 milliseconds is supposed to strengthen synapses.

What's the rule?

∆w = µ( (pre * post) - (p0 * pre) )

w is synaptic efficiency, pre is the presynaptic activity, post is postsynaptic activity, p0 is a constant that targets the postsynaptic neuron to low average activity (zero most of the time), and µ is the learning rate: the key factor for how quickly coincident firing strengthens inhibitory synapses.

Course of simulations, where the net membrane current on the target neuron is green, the excitatory current is black, and inhibitory current on the target cell (from the inhibitory synaptic firing) is gray. Note that the target ends up (after) at zero most of the time.

Clearly this is a flexible rule, where constants can be plugged in to approximate what is empirically observed. Yet its simplicity, once set up, is very impressive. A time course of simulation samples is shown above. The inhibitory activity starts at zero, (before), and due to frequent co-firing of the inhibitory and target neurons, (due to their common excitatory input), their connections progressively strengthen to the point that net firing of the target cell goes down close to zero (after) for all but unusual excitatory inputs that vary faster than the rule-based learning rate.

Different values for µ, or the learning rate, (apologies.. I use greek mu in the text in place of eta) make relatively little difference to system behavior, after perturbing the excitatory input (red line), compared to the background activity (black line).

As the authors put it: "In the detailed balanced state, the response of the cell was sparse and reminiscent of experimental observations across many sensory systems. Spikes were caused primarily by transients in the input signals, during which the faster dynamics of the excitatory synapses momentarily overcame inhibition." Thus from a very simple cellular structure is born a sophisticated information processing system.

Comparison of simulation (lines) to experiments (blocks) cited from other researchers on rat auditory cortex single-neuron learning curves in response to a shift in sensory (sound) signal frequency. The X-axis is in minutes, and the Y axis is excitatory : inhibitory current ratio, taken from two different cells- a cell tuned to the prior frequency (blue) or a cell tuned to a newly introduced frequency (red).

Lastly, the researchers turn to what this kind of circuit / rule can do in a larger scale neural system, using memory as an example. They simulate a matrix of 100 X 100 cells made up of mostly excitatory cells (Ex in the figure below) and 25% inhibitory cells (In). Unlike the determined circuits simulated above, here the cells randomly connect to 2% of the other cells in the population. The researchers assumed that enough inhibitory connections would be sprinkled throughout so that, given enough learning time, the network as a whole would behave in the balanced way they expect.

The graphs above follow the evolution of this system in time, with A showing the initial state where all the excitatory cells fire at full blast, and the inhibitory cells fire randomly. After a simulated hour of internal learning, (B), the network has indeed settled down to a baseline balanced, or AI state of very low output activity, shown by the dark snowy pattern, despite the excitatory cells still firing at the original rate.

At time C, the researchers introduced a permanent five-fold increased excitatory synapse strength within two patches of the matrix (red and blue squares in A; the unaffected control patch is black). The graphs underneath sample a few random cells from either the red or black (control) areas of the matrix. The transient activation / recognition of the introduced signal is clearly apparent (C). Yet after another simulated hour, (D), the inhibitory circuits have adjusted and the overall network is back to a baseline, quiescent state. The patches of prior high activity are completely invisible.

No measure of ambient neural activity would detect a memory engram here. Yet when a quarter of the red patch excitatory neurons were driven with extra activity, the full red patch lit up again, (E), showing that a full memory could be re-activated from a partial input. The cleanliness of this process, not overlapping the blue patch at all, indeed forming a slight negative image over it, is astonishing. This constitutes an extremely interesting and promising model for how information can be tucked away and later retrieved out of our brains.. a loosely constructed tangle of neurons and their ~100 trillion synapses.

What can I add? Perhaps that simulation is an increasingly essential element in biology, as in so many other fields. We are dealing with such complexity that it is hopeless to formulate comprehendable representations of this reality in prose form, or even graphs, charts, or other tools of presentation. To get at the dynamics of complex systems, critical and simple insights like that of Hebbs and the inhibitory neuron balancing rule promoted here remain essential. But to demonstrate what such insights really mean for complex systems, mental extrapolation is not enough- computer simulation is needed.

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• What's our beef with Iran?
• Obama administration, still shilling for the banks.
• Canada's CBC looks at Occupy. (Excellent book cited: The Spirit Level.)

Redistribution is required

Remember playing monopoly- how the rich get richer, and then the game ends?

Remember Monopoly? How one person with either luck or foresight bought all the railroads, milked the other players, and, towards the end, extended loans or gifts to keep their fun going a few more rounds? The end, however, was always the same- the game died because its mini economic system could not keep going if one person has all the money.

This seems an apt portrayal of our current economic seizure. An economy depends on the continual flow of money around, from one person's pocket to another's, and around again. The last two decades of rising income and wealth inequality meant that the mass of people have less money to spend, (and much of that money illusory, being debt), and the wealthy more. Since the wealthy tend to save their money, particularly as future prospects dim, we have the basic conditions for an economic heart attack- reduced circulation of money, and an even greater entrenching of the wealth divide.

Left to its own devices, and as we have seen over the last couple of decades, laissez-faire concentrates wealth upwards. A zealous and amoral focus on the rights of property and the fruits of economic success, however gained (think Bain) lead to a winner-take all system. Coupled with a political system beholden to money, it generates a spiral of entrenched interests and corruption. Only very rare crises of labor shortage (historically due to plagues) have historically reversed this flow within laissez-faire rules. The ultimate example is Rome, where the Senatorial class had massive land holdings, armies of slaves, and eventually exempted itself from any public duties, starving Rome of resources. It was a system that, for all its glories, was far less prosperous than our own, prone to revolt and ultimately, to rot.

What does laissez-faire accomplish by its concentration of wealth? For one, it forms the basic motivation to work..  whether to become wealthy or to keep body and soul together. For another, it is thought to put money into the hands of those best able to invest it productively (the vaunted "job creators" of GOP parlance).

Are those who have made a mint in our economic system the best investors for our common future prosperity? I think that logic has a few holes in it. Firstly, many of the wealthy are inheritors of wealth, and have no more economic accumen than a squirrel. I have proposed making the inheritance tax 100% to address this problem. Second, much wealth has been gained in the most amoral and unethical venues, (cf. Wall Street, board rooms elsewhere, and again Bain), full of self-dealing and cronyism. This hardly creates the forward-thinking, entrepreneurial venture creation and especially technical innovation we need to encourage.

And what are the harms of this concentration? Economically, as alluded to above, the wealthy may just sit on their hands and not invest their money, in which case the whole system grinds to a halt. On the other end, are the poor enlightened by their poverty, or have their character improved? Does this Darwinian system make them less likely to reproduce, in deference to their more successful betters? No, and no again. The immiseration of the mass of people serves no purpose beyond motivating them to engage in work- a point which we are obviously far, far, beyond. And of course keeping people persistently unemployed- the fruit we are currently harvesting from financial instability and unequality- is the exact opposite of what the whole mechanism was supposed to accomplish, which is employing everyone's talents to the best effect and for the general prosperity.

Politically, economic concentration leads to the very opposite of public good, as entrenched interests, (exemplified currently by the fossil fuel and financial industries, among many others), turn their wealth into corruption, buying legislators, elections, indeed burrowing into our very minds via the corporatized media.

So a modern economy needs some mechanism to counteract the natural course of laissez-faire. As a result, we engage in all the mechanisms of taxation, regulation, and redistrubution that now exist, from income taxes to welfare, Social Security, the military-industrial complex, and unemployment benefits. While the GOP harp about how evil these programs are and how they need to be "privatized", i.e. terminated, the last decades of rising inequality and, finally, economic breakdown, clearly show that stronger methods of redistribution are needed.

History provides countless mechanisms of economic redistribution, from the systematic to the catastrophic:

• Extended families
• Public works
• Philanthropy
• Circuses, staple food distribution
• Educational programs
• Dissollute gambling by the rich
• Taxation
• Old age pensions
• Inheritance taxes, divided estates
• Inflation, devaluation
• Begging, alms, charities
• Church donations, tithes
• Markets and trade
• Debt cancellation
• Corruption, patronage
• Land reform
• Expropriation
• Robbery, crime
• War, plunder
• Revolution

So the idea that "redistribution" is somehow inherently wrong couldn't be more misguided. It is why we have a society and culture in the first place. Better to arrange it systematically and productively than anarchically, but somehow, some way, a society's resources need to be and will be distributed to all members in some degree, by some method. The problem is really how to make flows of money through the economy optimally stable and equitable, while maintaining incentives that generate the original productivity.

The goals should be fairness, uniformity, legitimacy, and effectiveness. Markets have many of these characteristics, especially broad effectiveness, though we shouldn't kid ourselves that any market is truly "free". All are afflicted with unequal information, power, and other problems requiring ongoing regulation by entities superior to the market.

These desired attributes are present with a great deal more justice and redistributive power in a well-run democratic government and its universal programs of taxation, pensions, education, etc. These are far more fair and effective than relying on charity, gambling, crime, luxury spending, philanthropy, or other such miscellaneous methods of redistribution. They are also more macroeconomically useful, i.e. adjustable on a very large scale. When it comes to problems of common action, which describes this issue of regulating and counterbalancing the laissez-faire system, government is not only not the problem, it is the only solution, though dependent on its institutional quality.

Thus our moment of economic crisis, while temporarily strengthening the very forces that caused it, demands a conscious, long-term, and organized corrective response. Responses like taxation that is actually progressive in practice, not just in principle, strong estate taxation, increased outlays for education, a sustainable energy future, and a job guarantee for everyone willing to work.

Image of Andrew Jackson, the first president to do serious battle with the emerging corporate monster, here in the form of the specially chartered Second Bank of the United States, which he destroyed. "Biddle, thou monster, Avaunt!"

• Martin Wolf on the critical and rising importance of public goods.
• Martin Wolf gives his succinct economic prescriptions.
• On the foolishness of low capital gains taxes.
• More on the shady money behind Bain.
• The status of the "corporations are people" movement.
• Speaking of fights against the evil empire, an endlessly funny / loving homage to Star Wars.
• Apple uses on quasi-slave labor in China.
• At the same time, it doesn't care very much about its investors, either.
• Leakers get screwed. Killers and torturers, not so much.
• Warren Buffet as an object lesson in MMT economics.
• Economic quote of the week, by Winston Churchill, via Bill Mitchell

"I should like to see the State embark on various novel and adventurous experiments … I am of opinion that the State should increasingly assume the position of the reserve employer of labour. I am very sorry we have not got the railways of this country in our hands."

• Show of the week: Alabama shakes.

Antarctica- when does it melt?

The short answer: at 1000 ppm CO2.

Global warming has many consequences, most far more momentous for other organisms than ourselves. Whole ecosystems will die and regress to more primitive networks and members. But real estate agents have cause for concern as well, as sea levels rise and innundate low-lying areas. When and how high?

Sea levels have already risen ~20 cm over the last century. But far more is coming, as CO2 levels continue to rise along what seems to be a "business as usual" trajectory. The IPCC has offered various optimistic scenarios of international cooperation which have all come to naught. Coal is being burned at record rates. The critical graph is readings of atmospheric CO2, courtesy of Wikipedia:

From a pre-industrial level of ~285 ppm, already high by the standards of the last few hundred thousand years of the ice ages, we have broken through to almost 400 ppm. (ppm is parts per million, or 0.0001%, so the current percentage of CO2 in the atmosphere is about 0.04%).

The atmosphere weighs about 5E18 kg, so each 0.01% or 100 ppm is about 5E14 kg, equivalent, in terms of wood, to 3.1E14 kg, which in terms of average forest density (~2400 kg per 100 sq m forest) corresponds to about 13 million sq kilometers of forest.

The land area of Earth is ten times that amount, which I hope offers some useful scale to the problem. About half our emissions are taken up annually by the oceans and forests, so the true scope is twice that size.

At any rate, where are we going? The IPCC graphs indicate that, barring action and assuming that CO2 emissions in 2050 are roughly double what they are now (scenario gray / VI), we would get to roughly 1000 ppm around 2100.

Click to see full size. The main point is the choice of remediation scenarios that get us (right graph) to various ultimate atmospheric concentrations of CO2. Brown and gray are the business as usual scenarios that we are currently following. 

The prospects of serious sea level rise come from the various frozen forms of water stored around the world. The IPCC consensus has sea levels rising only about 70 cm by 2100, but to me the dangers seem far more severe. To learn what a full melting scenario would mean, the USGS helpfully supplies the details:

• Greenland: 7m rise
• Antarctica west ice sheet- 8m
• Antarctica, rest-    65m
• Other glaciers, etc: 0.5m
• Thermal expansion- 1m

            Sum = 80 meters, or 262 feet.

So if everything were to melt, we would be in serious trouble. Whole states would practically disappear. This is quite aside from the many other brutal effects of such climate change all over the biosphere.

"A sea-level rise of 10 meters would flood about 25 percent of the U.S. population" 

Here is where a recent paper comes in, analyzing how Antarctica got so cold and snowy in the first place. We know that Antarctica iced over around 34 million years ago, but the precipitating circumstances (ouch!) have been in some dispute. Specifically, it is difficult to accurately estimate the atmospheric CO2 concentration from various fossil / chemical / geological traces. These authors focus mostly on better ways to deduce the CO2 record around this time, refining an estimate which indicates that atmospheric CO2 decline was the central driver of this process, and that falling below about 1000 ppm was the critical event.

This is the main graph, showing their inferred CO2 levels (colored circles) through the time at issue. The inset shows finer detail. Note that time goes backwards in the reverse direction, from recent to ancient. Obviously there is a noticeable decline around the time of Antarctic glaciation, and low atmospheric CO2 persists thereafter, lowering further (off the graph) going into our more recent epoch of ice ages. The gray lines are data from others, showing inferred CO2 levels from other analyses (∂18Oxygen in organic sediments, rather than the carbon isotope analysis the authors here focused on). The latter is more dramatic, but generally on the same trend.

Incidentally, Antarctica was pretty much in its current tectonic position by this time in Earth history. All this adds up to strong historical case that 1000 ppm CO2 is a plausible breakeven point for Antarctic melting. Such melting wouldn't happen overnight- it may take centuries, depending on how far over 1000 ppm CO2 we go. But clearly, among many other problems we are bequething to posterity is the likelihood that, if we continue along the business as usual trajectory, doing nothing about fossil fuel use, we will end up in hot water.

• "The global direct subsidy for fossil fuels is around ten times the subsidy for renewables."
• Some interesting notes on Milton Friedman and MMT economics.
• Moyers on inequality. The "economy" is not a natural phenomenon- it is a political process and result.
• Dodd: I won't be lobbying. ... How dare they use their freedom!
• Who takes the biggest risks? Workers do.
• Bain, at the public teat.
• What's the deal with SOPA, PIPA, and the internet blackout?
• Long view of the shortage of public goods.
• Let's steal a few things from religion!
• God makes the US exceptional, says Callista.
• Economic quote: Salon on debt...

"The speculative bubble happened for many reasons. The most important reason, we think, is that most Americans weren’t making as much money. Median wages stagnated. People couldn’t borrow to invest in the stock market, but they could borrow money from a bank very easily to buy a house. People thought investing in the housing market gave them leverage to make money quickly."

Elect Gekko

Mitt Romney brings a campaign of the rich, by the rich and for the rich.

The Republicans have a problem on their hands. After a marathon of more or less collegial debates, and on the verge of wrapping up their process and annointing their nominee prior to actual voting, it starts to become apparent that the one candidate who is not certifiably crazy, and has bought his way to the top in best Republican fashion, might not be the right horse after all.

The Occupy movement is in hibernation, but its memes have succeeded in turning the tea-party tide. The 1%, the 99%, "Occupy", and pejorative "Wall Street", have become guideposts in our discourse. Slowly the GOP is waking up to the fact that while being the party of the 1% is one thing, having a candidate and leader who is the perfect embodiment of 1%-ism is something quite different. Romney is that candidate, and may face an even worse election day than John McCain did four years ago.

Romney is of the 1%, is funded by the 1%, supports the 1%. He is using his money to buy endorsements, bury his opponents, and take small states like Iowa by storm. But money can't buy the general election, at least not yet (not when the other side is another well-funded front for the 1%, more or less).

At any rate, Romney's story may just be a little too brazen even for our jaded and corrupt age. His tax plan raises taxes on the poor and lowers them for the rich. This after several long decades of rising income and wealth inequality that have eaten into the very fabric of our country, and which Romney himself did a great deal to advance.

Much of his work at Bain was dedicated to "aligning" the interests of company executives with those of shareholders, and away from those of workers, with the result that executives, him included, made gobs of money while workers were shown the door, had benefits reduced, pensions taken away, and their companies bankrupted. 22% of companies he touched ended up in bankruptcy, but not before debt was taken on and enormous bonuses paid out. Much of this virtuous alignment had to do with high-risk leveraging, executive stock "participation", and a consequent focus on the shortest-term results. What has it left us with?

Economic efficiency is not always a bad thing, and Romney had every right to be a vulture / arbitrageur in the system. But making this out to be some kind of virtue and model for presidential leadership seems a little hard to swallow, even for his erstwhile capitalist-touting GOP opponents. John Stewart jokes that they suddenly see themselves as the 99% ... of the 1%. The list of Romney's targets and deals at Bain makes dreary reading- sundry consumer retailers and low-tech manufacturers whose innovations and efficiencies lie in reading spreadsheets, firing workers, offshoring, and putting slightly less ruthless retailers out of business. Sure, if we need a new Dunkin Doughnuts CEO, Romney might be the guy. But president?

Mammon plays a leading role in Romney's campaign as well. Who supports him? The rich, of course, for the most virtuous of reasons! So not only does he have his own fortune to run on, but as a tailor-made, say-anything representative of the plutocracy, money comes his way like manna, ready to buy endorsements, ads, and votes. His lack of a center is apparent in his spontaneous remarks, and also came out in his tenure as Governor of Massachusetts. His ambition was to solve problems, and he did a great job with the univeral health care program, as he had with the Salt Lake Olympics previously. But who knows what "efficiencies" and problems he will latch onto on the national stage? Everything we hear is cant and regressiveness.

It reminds me of another expert technocrat, doctrinaire capitalist, economic "modernizer", administrative wizard, and all-around rich guy in American history- Herbert Hoover.

• Republicans become socialists- horrors!
• Restructuring the US, Gekko-style. Sell off Alaska!
• Lawrence Krauss gives a rather funny physics talk.
• Our new chief of staff: "Deregulation had nothing to do with the crisis."
• Haiti- not doing too well.
• Prospects for reducing fuel use in transportation ... taxes are required.
• "Necessitous men are not free men."
• Economics note of the week: 

Not actually a quote, since Bill Mitchell had no concise bon mot to offer. But he describes the perverse process by which neoliberal economics looked at lengthening unemployment periods (longer time taken to find a job) in recent decades after the Keynesian heyday of quasi-full employment, and concluded that workers were lazing about and decided to "prefer" jobless benefits to working. These economists & politicians then dedicated themselves to cutting unemployment and other welfare benefits to "encourage" job search.  

Obviously, however, the data said something quite different, which is that along with the increasing specialization of work, which makes job matching increasingly difficult, (i.e. friction in the labor market), the overall higher unemployment rates made employers more choosy, allowed them to cut worker pay and benefits at the same time that unemployment benefits were cut, leading to overall lowering of demand, made up temporarily by consumer and real estate debt. At any rate, prodding more people to look for work via improverishment when no more work is offered can hardly solve the employment problem. But it does destroy people's lives and impair overall prosperity.

Thomas Paine, tea-partier, ur-blogger, socialist

What would he write now?

Edmund Burke wrote a famous attack on the French revolution. While he thought King George's "American war" was unwise, he defended monarchy and all the peculiarities of the English government against the winds of rationalism and popular revolution blowing over the Channel (and from the colonies). Much of his vitriol was lent by the influx of French nobility who successfully stoked the fires of royalist counter-revolution throughout Europe. The later horrors of the French revolution certainly justified some of Burke's critique. And many aspects of his conservatism stand the test of time, such as the basic principle that measured reform (or even stasis) is often preferable to sudden revolution, out of humility before the many unknowns inherent in tinkering with a functioning social organism.

Yet the reply he got from Thomas Paine attained greater fame and influence. Paine's Rights of Man pursues multiple themes, including ridiculing Burke, defending the French revolution in rather glowing terms, (before the terror got underway), fomenting anti-tax revolt in Britain, and even proposing a comprehensive system of welfare and good works by an enlightened British government, using all the revenue left over once it had defunded the royal court.

Paine's surest avenue of attack is on Burke's defense of the English "constitutional" monarchy. In contrast to France, which had just written itself a constitution, Britain had none and still has none. Paine goes to great lengths to explain the difference between a proper constitution that explicitly sits above and controls the rest of the political system, and the regular laws and indeed unwritten customs & practices which Britain relies on to perpetuate its political system. Obviously what Burke meant as "constitutional" was the legal controls on the monarchy that had grown into the parliamentary system and continue to this day to progressively neuter the royal family. Especially Coke's Petition of Right. But without a formal consitution, it is hard to defend a "constitutional" monarchy.

More damning were Paine's various witticisms about royal government:

"Admitting that government is a contrivance of human wisdom, it is must necessarily follow that hereditary succession, and hereditary rights (as they are called), can make no part of it, because it is impossible to make wisdom hereditary; and on the other hand, that cannot be a wise contrivance, which in its operation may commit the government of a nation to the wisdom of an idiot. The ground which Mr. Burke now takes, is fatal to every part of his cause. ... To use a sailor's phrase, he has swabbed the deck and scarcely left a name legible in the list of Kings; and he has mowed down and thinned the House of Peers, with a scythe as formidable as Death and Time. [i.e. the requirement that they embody wisdom]."

"As the republic of letters brings forward the best literary productions, by giving to genius a fair and universal chance; so the representative system of government is calculated to produce the wisest laws, by collecting wisdom from where it can be found. I smile to myself when I contemplate the ridiculous insignificance into which literature and all the sciences would sink, were they made hereditary; and I carryt he same idea into governments. An hereditary governor is as inconsistent as an hereditary suthor. I know not whether Homer or Euclid had sons: but I will venture an opinion, that if they had, and had left their works unfinished, those sons could not have completed them."

"It could have been no difficult thing in the early and solitary ages of the world, whle the chief employment of men was of attending flocks and herds, for a banditti of ruffians to overrun a country, and lay it under contributions. Their power being thus established, the chief of the band contrived to lose the name Robber in that of Monarch, and hence the origin of Monarchy and Kings."

And in a prescient word to the British...
"As it is not difficult to perceive, from the enlightened state of mankind, that hereditary Governments are verging to their decline, and that Revolutions on the broad basis of national sovereignty, and Government by representation, are making their way in Europe, it would be an act of wisdom to anticipate their approach, and produce Revolutions by reason and accommodation, rather than commit them to the issue of convulsions."

Thankfully, barring Syria, Saudi Arabia, and North Korea, hereditary monarchy has mostly ended its reign on earth. Democracies rule the world. Are they doing a good job?

Paine represents an interesting blend of progressive and tea-partier. He rails throughout the book in best blogger fashion against the oppressive taxation that supports royal courts and their hangers-on, clearly trying to incite the British against their system. But in the most detailed part of the book, he proposes specifically that most British taxes be retained and their revenue diverted to various socialistic ends, such as old-age pensions, educational allowances, and publicly-sponsored factories where anyone without employment could be employed as long as desired, among others. Really, a very forward-looking program, much of which has come to pass. The employment guarantee is particularly interesting and appropriate to bring back into our present-day discussion.

"Civil government does not consist in executions; but in making that provision for the instruction of youth, and the support of age, as to exclude, as much as possible, profligacy from the one, and despair from the other. Instead of this, the resources of a country are lavished upon kings, upon courts, upon hirelings, impostors, and prostitutes; and even the poor themselves, with all their wants upon them, are compelled to support the fraud that oppresses them."

"When it shall be said in any country in the world, my poor are happy, neither ignorance nor distress is to be found among them; my jails are empty of prisoners, my streets of beggars; the aged are no in want, the taxes are not oppressive; the rational world is my friend, because I am the friend of its happiness; when these things can be said, then may that country boast its constitution and its government."

"Revolutions, then, have for their object, a change in the moral condition of governments, and with this change the burden of public taxes will lessen, and civilization will be left to the enjoyment of that abundance, of which it is now deprived."

But what would Paine write about our current system?  What is our moral condition? Despite all our progress, I think he would characteristically diagnose a deep and corrupting problem. Our representatives serve two masters- the voters, and separately, the moneyed and corporate class. As Lawrence Lessig has noted, our putative representatives spend about 70% of their time grubbing for money- from corporations, from the rich, from mass mailing missives, and the like. This time is not just lost from service to their consitutents and from cogitation on better policy, but is explicitly opposed to the public interest, as every payment is a quid pro quo, well understood by all sides, for favors that otherwise would not occur.

Right now, the financial industry has thoroughly corrupted both parties, forstalled prosecution and evaded regulation of its highly damaging gambling addiction, and indeed corrupted the economic profession itself through its web of consultancies. sinecures, and parroting institutions, to the point that the public doesn't yet thoroughly understand the basic nature of the crisis. Too big to fail, among many other ills of the financial casino, remains the law of the land, and another crisis is inevitable if nothing further is done, though it may take a decades to attain a sufficiently bubbly economic state.

To Paine, the proposition would be simple. Voters have been displaced as political actors in a system where our media and academic elite are for sale, or already owned by corporations with interests frankly opposed to the public interest, and where our erstwhile representatives sell themselves daily for the money they need, while contorting more (Democrats) or less (Republicans) to suit a publicly salable ideology of the public good. One might say that we support two wasteful and fawning royal courts- those of the two parties, each ostensibly vying for public favor while vying more energetically for funds from well-hidden and corrupting private interests. It is a constitutional crisis.

Paine's revolution was one of fairness- that state and politics should not be run by the few for the few, milking the many, but of the people, by the people, and for the people. In his world, money spoke loudly, but the media and elite leadership were not quite as thoroughly for sale as they are now. His media was not as technologically sophisticated, as pervasive, as distracting, as thoroughly corporatized, nor as powerful as it is today. We are a far cry from Benjamin Franklin's printing press and Paine's pamphlets.

The answer is to restore to the people critical levers of representative power, especially the lever of funding the nation's political life directly. Lessig's plan is to provide vouchers to all citizens that they can then contribute to politicians. All levels of government would disburse tax money to candidates in proportion to vouchers contributed by citizen supporters. Candidates would then be able to gain funds in direct proportion to their popularity, and cut their private money grubbing entirely. Perhaps vouchers could be dispensed continually, so that momentary swings in popularity wouldn't lock up a race prematurely.

We marvel at the amounts spent on modern political campaigns, but our political system is important and deserves generous funding, so that voters and candidates can interact effectively and learn each other's views. Systems of full and generous public funding will decouple our representatives from some of today's worst corruption.

But more needs to be done, especially to improve the media environment. Aside from campaigns, money now buys unlimited political speech and what is more, unlimited political flack-power from "think" tanks and other media / front / spin / astroturf organizations. On its own, that wouldn't be so bad. But where else can one turn for (balanced!) political coverage and insight if the rich own all the media megaphones? Our TV and radio spectrum is limited, and stations are sold to the highest bidder. Newspapers have become one-per-town monopolies due to the high-cost structure of the modern paper and to winner-take all network effects we have come to know so well from the computer and internet industries. Even if non-political commercial interests alone rule the airwaves, where does that leave citizens that advertisers are not interested in, like the unemployed and minorities?

While Paine would surely be pleased by the wide freedoms of the contemporary internet, he might be pained by the degraded and virtually inarticulate show of political soundbites, lying, and scare-ads that characterizes politics in the mainstream media (which masks the more salient hidden competition between moneyed interests). What to do? Here public interest and public funding should be advanced as well. Examples like the BBC and CBC show that major public media can be consistently neutral and effective in broadening access and raising the level of debate (excepting, for the moment, "Thought for the day", and also the entire Euro crisis political theater, and ...).

In short, public media deserves to be strengthened in the US. Ideally, all spectrum-using media would be compelled to provide commercial-free public interest programming, whether oriented to children, or to political coverage, or the arts. Secondly, public broadcasting support would be expanded so that second channels could be established nationally and coverage broadened. At our house, intriguingly enough, we get TV signals from stations funded by Russia and China, but the US government supplies only a pittance to fund our own public media- PBS and NPR.

Lastly, the loss of diversity and investigative motivation in newspaper monopolies could to be addressed by funding local newsgathering on a non-profit basis, perhaps as part of the above expansion of existing public media. With web publication as cheap as it is, minimal amounts of public money could create a grassroots investigative and newsgathering network that gives citizens important information and alternate perspectives on their local affairs, unencumbered by commercial imperatives. (This might be called the crank blogger employment act!) Obviously, there is risk in letting the government dabble in media sponsorship, but it has been done well, here and elsewhere, and the new media age provides enormous opportunities at relatively low cost, if the government is not otherwise corrupted.

Paine even had a prescient word about the EU:
"Government ought to be as much open to improvement as anything with appertains to man, instead of which it has been monopolized from age to age, by the most ignorant and vicious of the human race. Need we any other proof of their wretched management, than the excess of debts and taxes with which every nation groans, and the quarrels into which they have precipitated the world?
Just emerging from such a barbarous condition, it is too soon to determine to what extent of improvement government may yet be carried. For what we can foresee, all Europe may form but one great republic and man be free of the whole."

• Outstanding article on Roger Williams, who defended Rhode Island from invasion by Massachusetts!
• For those not following Krugman's blog, Hungary is heading towards one-party rule.
• We need global governance.
• A late-breaking Xmas song...
• Montana, at least is holding out against corrupt practices.
• Economic quote of the week, from Bill Mitchell:

"As I explained in this blog – 'Historically high budget deficits will be required for the next decade' – the reason that Japan continued to grow despite the “massive loss of wealth” is because the government stepped in and maintained the flow of spending."

• Economic graph of the week- employment from Fed data.

Note how the proportion of the population employed is still at bottom at the end of 2011, and how the unemployment rate belies the lack of progress or recovery in actual employment, due to an imaginary decline in the "labor force"- we remain in a catastrophic situation for roughly 4% of the population, or ten million people, who are involuntarily unemployed, and whose situation has cascade effects throughout the labor markets.