February 2012 – Page 2

Formalism Recap

Aretae responds, with the other prong of his anti-formalism.

To clarify, there are two possible weaknesses to formalism. The first is that it might simply fail to achieve its purpose: it is supposed to free us from the destructiveness of power used to maintain or increase power, by unifying power into a single sovereign — but even a de jure absolute sovereign may still have to compromise, with the popular, the wealthy, the well-armed, and those compromises might lead to just as damaging internal conflict as the more explicitly dispersed power structures we are familiar with.

The second possible weakness is that whoever is in power might resist beneficial innovation in technology or social organisation, for fear of the unpredictable results.

Strictly speaking, the second is just an instance of the first: if a ruler has absolutely no fear of being usurped, he has no reason to resist disruptive innovation. So if I perfectly dispose of the first problem, I can go home.

My previous post was a response to the first weakness: that even if de jure absolute, the sovereign would have to face threats, and if he feels he needs to deal with a threat by compromising on policy, we are back in coalitional government.

In the original statement of formalism, Mencius Moldbug had one solution for these weaknesses: the machine-gun. If that really works, great, but I’m not totally convinced.

So my recent posts were to say: if the sovereign really has to compromise, giving away power is bad, but giving away money and status is not so bad. I’ve actually made the same point before, on Over-Mighty Subjects.

Bear in mind that what I’m trying to create here is not a future written constitution or a handbook for princes, but a political formula which will support good government.

The machine-gun solution sounds far-fetched, because we assume that use of excessive force against popular insurrection will turn neutrals against the sovereign and make the problem worse. But we live with a political formula of popular sovereignty, which says the ruler has a duty to listen to and to appease the mob. There is therefore a presumption that the mob is right and the government is wrong. In my formula, the duty of the ruler is to prevent faction by keeping his sovereignty intact and undivided. The common presumption would be that the mob is wrong and the rulers right. I don’t think this is far-fetched — on the contrary there is ample precedent for such a popular attitute.

So, I’m the sovereign (this argument applies to formalism generally, so it doesn’t matter right now whether I’m the hereditary king, or the SovCorp CEO, or the ruler under some other formalist system). I have absolute power, but there are a few guys who if they really wanted to, could cause me trouble. Let’s say Alrenous, who asked me how one gets latent power, is running a TV broadcaster: if he started using that to build a political base — well, I could have him shot, but he might already have so much support that that would start to undermine the political formula. Or if I had him shot too soon, before he’d really made a move, I’d be creating a whole lot of paranoia.

Alrenous gets invited to head office/royal palace, and we have a chat. I explain that I have no wish to interfere in his business, so long as he doesn’t challenge my rule or my exclusive competence over law and policy. The Honorable Sir Alrenous leaves the palace and goes back to work, with official marks of status and a pension for life, and makes no move towards politics. Other TV magnates get the same treatment. If one rogue does try to build a political movement, well, that’s treason and he should have taken the deal. The guys who did take the deal will stay onside.

That’s not a perfect solution to Formalist Weakness #1, but it’s adequate: I leave business mostly alone, because I want the economy to flourish and pay me taxes, but I don’t tolerate active opposition, and because the virtue of loyalty, the key part of the political formula, is popularly established, that stance is understood and respected. I collect taxes and become stupendously rich: the optimium level of taxation over the long term is probably around 30% of GDP, a bit less than governments collect now, but while current governments waste 50-90% of it, I spend a third to a half on essential state services, and the rest is mine.

(I assume you would probably prefer not to spend 20% of your income on making the sovereign or SovCorp shareholders stupendously rich, but it’s still a better deal than you get now.)

As an aside, those riches are necessary: we are used to the idea that successful businesses can influence government, but the main consequence of the separation of powers is that government influence can be bought incredibly cheaply. Steve Sailer marvelled recently at the concept that it seems to be cheaper to buy the presidency of the USA than to buy the college football championship. In Britain, the cost of buying policies is a couple of orders of magnitude lower still — entire 5-year general election cycles are fought with single-figure millions of pounds, total. If the ruler actually had control of the money the government currently wastes, he would be utterly immune to the influence of a few piddling millions here or there. It seems weird to write, as I did above, about governments bribing businessmen, but it shouldn’t.

Back to the main point: buying off the latently powerful with status and money is not perfect, but it’s an adequate response to the danger of internal factions arriving and skewing policy away from effective government, and towards strengthening one faction or another. But not being perfect, it does not eliminate Formalist Weakness #2. I’ve bribed the TV broadcasters, they get their pensions and their knighthoods and they swank around, but meanwhile someone’s invented the internet, and these TV guys could be on the way out.

Sure, I can do the same again with the internet crew. But, there’s always some risk, while I know exactly where I stand with the TV lot. Also, if the TV companies as a group realise where things are headed, my deals with them might start to break down. The safest thing for me to do is to strangle this internet crap in the cradle. I make policy, I’m unchallenged, it’s central to the culture that nobody interferes with my rule, so if I say many-to-many publishing is a threat to state stability and is not allowed, that’s the end of that. And so it goes: the economic and social structure is frozen, because the one we have is the one that keeps me in power. This is Aretae’s point in his latest piece: “The coalitional nature of government is therefore primarily interested (in effect) at stopping innovation.”

If states are small and in competition, the threat of falling behind economically balances the threat of internal instability. It’s ambitious enough, though, to be trying to engineer how one state should work. We’re not realistically going to get to choose how big states are — that depends largely on military aspects that are beyond my expertise, and in the long run subject to change. Moldbug’s Patchwork of city-states would be great, but all we can do is hope.

All I can really say is, If you knows of a better ‘ole, Go to it. An aversion to disruptive innovation is likely to be a feature of any stable government at all, and I don’t accept that unstable government is a price worth paying to avoid it. Note that our current governments, behind the curtain, are moderately stable, and indeed we have the aversion to innovation that goes with that. In the mid 19th century, power fell into the hands of factory owners, and for a hundred years we had all the innovation that could benefit mass manufacturing industry. That was very good for economic growth, but don’t be fooled for a moment into thinking it was perfect: I think if you look at the mutualists and agorists, they have substantial evidence that policy over that period was specifically pro-mass-industry, not generally pro-growth.

Aretae says small states and hyper-federalism will protect disruptive innovation, but the ruling coalitions of those small states, however concentrated or dispersed, will have exactly the same interest in preventing disruption, and what’s to stop them cooperating to achieve that? Hasn’t that been the dominant mode of international relations for the last half century? Small states become federations, federations become large states. All in the name of peace, trade and internationalism, of course, but what is the end result? ACTA.

The problem is real, I don’t have a solution, but the more secure the sovereign is in his power, the more the risk-benefit balance tilts towards growth rather than stability.

SOPA

I never blogged on the SOPA kerfuffle; it happened while my creative(?) energies were elsewhere.

Looking back, a few minor points emerge:

Some commentators got all excited: “look what we did! What shall we do next?!” “We” meaning right-thinking internet-type people. The answer, obviously, is nothing: this, “we” agreed about, most things, we don’t. I think Wikipedia’s claim: “Although Wikipedia’s articles are neutral, it’s existence is not” was basically justified.

Libertarian commentators had a lot of fun jeering at leftist techies who wanted every aspect of the economy to be regulated by the government except the internet. The criticism is only justified against those who demand that government regulate things but don’t specify exactly how they should regulate them (others can say they’re in favour of regulation, but just want it to be better). But that’s most people. So yeah.

In some ways, it’s a disappointment that SOPA didn’t go through; the circumvention techniques that would have been developed if it had would have been interesting and useful. At the end of the day, the biggest threat to free computing isn’t legislation, it’s that in a stable market, locked-down “appliance” devices are more useful to the non-tinkering user than general-purpose, hackable devices. So far, we tinkerers still have the GP devices, because the locked-down ones go obsolete too quickly even for lay users. I’m not sure whether that situation will persist for the long term: I’ve looked at the question before.

But if the government makes stupid laws that can easily be circumvented using general-purpose devices, the demand for those devices will be helpfully supported.

Note when I talk about circumvention, I’m not talking about copyright infringement. That was not what the argument was about. While I lean toward the view that copyright is necessarily harmful, I’m not certain and it’s not that big a deal. The important argument is all about enforcement costs: given that copyright exists, whose responsibility is it to enforce it. The problem with SOPA was that it would have put crippling copyright enforcement costs on any facilitator of internet communication.

Currently, internet discussion is structured mostly around large service providers — in the case of this blog Google — providing platforms for user content. If those service providers become legally liable for infringing user content, the current structure collapses. The platforms would either have to go offshore, with users relying on the many easy ways of circumventing the SOPA provisions attempting to limit access to offshore infringers, or else evade the enforcers by going distributed, redundant and mobile. What will be to Blogger as Kazaa and then BitTorrent were to Napster? It would have been interesting to find out, and possibly beneficial. There is a lot of marginal censorship that can be applied to easy-target platforms like Blogger or Wikipedia that will not induce sufficient users to create alternatives, as the sheer idiot clumsiness of SOPA would probably have done.

(Note Wikipedia might have been spared, but it would have suffered, because if existing less respectable platforms were removed, their content would migrate to the likes of Wikipedia. If 4chan did not exist, Wikipedia would become 4chan.)

Actually, it’s interesting to think about how to blog over a pure P2P framework. Without comments, you’re publishing a linear collection of documents. (I don’t think you can handle comments — we’d need something more like trackbacks). Posts would need to be cryptographically signed and have unique ids. Serial numbers would be useful so readers would know if they’d missed anything. I wonder if anyone’s worked on it. A sort of bittorrent-meets-git hybrid would be really interesting — search this list of hosts for any git commits signed by any of these keys…

The dance of censorship and evasion is very difficult to predict in detail. I found some time ago that the way to find the text of an in-copyright book is to take a short phrase from it (that isn’t a well known quotation or the title) and google it. That used to work. I wanted some text from Evelyn Waugh’s Decline and Fall the other day, so I did the usual, and got pages and pages of forum posts, containing chunks of the book interspersed with links to pages selling MMO currency and fake LVMH crap. My access to illicit literature was being messed up by someone else’s illicit SEO.

Law, Order and Prisons

This is a truly bizarre article.

The author, Christopher Glazek, makes a lot of good points about the American prison system, in which prisons are run by the inmates. He points out that according to some statistics, the majority of all rapes committed in the US occur in prisions. We have heard elsewhere recently that more black Americans are in prison today than were in slavery in 1860, and that more people are in American prisons than were in the Gulag Archipelago (although, to be fair, that is partly because the latter tended to die).

The solution proposed by Glazek is: to let the prisoners out to commit more crimes. There is no mincing of words; the title of the article is “Raise the Crime Rate”. Not for Glazek any wishful-thinking “prison doesn’t work” rhetoric, his thesis is clearly that it does work, but the price is too high.

Part of the weirdness is that he seems to regard a reduction in crime partly as a bad thing in itself:

Certain breeds of urban dwellers benefit, too. In gentrifying sections of Brooklyn, for example, steep drops in crime, combined with the virtual depopulation of entire city blocks, has underwritten a real estate boom. In neighborhoods like Fort Greene and Clinton Hill, wealthy people with children have reaped the benefits of climbing land values from apartments they never would have bought had it not been for the removal of tens of thousands of locals from adjacent areas.

Er, yes. Reducing crime makes neighbourhoods nicer and encourages people to live in them. That’s more or less the point.

What Glazek never addresses is the question of why the US is unable to keep order inside its own prisons. From an international point of view, this is the obvious question. The UK, as he observes, imprisons fewer of its criminals, but here there is no assumption that prisons are run by the inmates. There is a possibility that here we are just misled, but I don’t think so. There was for a time one exception to the rule, the Maze prison, where Northern Ireland’s terrorists were held, but the management of that prison, with opposing factions kept in separate wings run by their own paramilitary hierarchies, was a major controversy. The terrorists were de facto prisoners of war, though de jure that status was always denied them, and the contrast demonstrates that the situation in the mainland prisons really is different. Compare to this astonishing paper on the Mexican Mafia, which demonstrates that gang prisoners in California have essentially the same status as the paramilitary POWs of the Maze H-Blocks.

There are statistics in the article: the US spends 200bn a year on a system which employs 500,000 correctional officers to supervise 2.3 million prisoners. Is it really not possible to control crime inside the prisons with a ratio of more than one officer to five prisoners?. The abandonment of law and order inside American prisons is a choice, one probably inherited from the country’s frontier days, and one which simply cannot be justified. If violent criminals continue to commit — and suffer — violent crime inside prison, the answer is surely not to move them out to prey on the law-abiding, but to actually enforce order in the one place where it ought to be easiest of all to do. Don’t, as Glazek recommends, put TV cameras all over the country: put TV cameras all over the prison. (That was a progressive idea in 1791). And finally, if you’re going to release prisoners because there are too many, release the ones that don’t commit crimes inside.

Meritocracy versus Loyalty

This has been sitting in my drafts directory for three months, since I read this Ross Douthat column on Corazine. But it goes with some of what I was writing yesterday, so I’ve dusted it off.

Douthat points out, I think rightly, that the defining features of our modern elite are its arrogance and its recklessness.

Arrogance is perhaps an inevitable weakness of any elite, but I think he is right to identify the recklessness as something new since the days of a hereditary upper class.

For one thing, someone who has been elevated from a humble background wholly or mostly by their own efforts and ability is likely to have a very high opinion of that ability. that again seems almost an inevitable side-effect of having the most able people in positions of power.

I think it’s more significant that a large number of people in positions of serious power have absolutely no-one above them. If you are Governor of a state, or CEO of a company, you are theoretically responsible to voters or shareholders, but they do not play the role of a superior in a social or psychological sense, they are more the material a politician or manager works with than the patron he works for.

If the most significant person you know of is yourself, then the brutal one-sided logic of excessive risk-taking kicks in. You’re already successful, you’ve got a well-upholstered safety net, so when you take a big gamble, if it comes off you’re a hero and move up to the next level of achievement, and if it doesn’t you take a break for a bit to play golf and then try something new.

That unbalanced incentive is widely recognised now, but in itself it is not what’s new. Limited Liability has been around a good while, as have the country houses of disastrous politicians. What is new is the end of loyalty. In the past, the bulk of those wielding power were tied not just by their rolling contacts but by bonds of loyalty to superiors. A failed gamble would impact not merely a crowd of insignficiant peasants, voters or shareholders, but would hit the status and reputation of those whose approval or disapproval actually matters.

Obviously there were always a few who were beyond any such limitations, but think about how many there are now who have no practical superiors. It would have been hard to have made a list that would have included “CEO of MF Global”.

Nor is the concept limited to business. To whom does Hillary Clinton, or the head of an agency, look up as a superior? To the President who appointed them? I don’t think so. He’s just another punter. What about Paul Krugman, or some pressure-group head?

The distinction I’m getting at, between a technical superior and a psychological superior, is whether the superior’s opinion matters beyond the immediate game being played. If you’re a department head in a company or a government agency, your boss can fire you. But that’s all he can do, and that’s the only risk you’re taking. Once he’s done that, he’s not your boss any more. On the other hand, if your boss is your lifelong mentor, then he’s a psychological superior. Even if he fires you, he doesn’t stop being your superior; you still need his approval at some level. I think such relationships were once the norm, and have been becoming steadily less common for a few hundred years.

A response has been to try to build up abstracts to which powerful people feel loyalty. Many companies try hard to impress on their people the idea of being part of something bigger than themselves, but that’s a tall order for an institution which itself is required to operate by cold logic.

The replacement of mentor-protégé relationships by meritocracy has had two drivers: first, modern communications, record-keeping, and the broadening of trust up to recent times have meant that positions are being filled from much wider pools of candidates than before, while at the same time, as I described yesterday, the concepts of personal loyalty and rewards for loyalty have become seen as suspect, even corrupt.

I therefore propose a two-pronged response to the problem of meritocratic recklessness: First, personal loyalty to a mentor should be recognised as something moral and admirable, and secondly, the most senior positions should be held by individuals on a longer-term schedule, to encourage the maintenance of such relationships.

Basic Power and Political Power

I ran into a terminological problem in the previous posts. I was making the argument that it is more acceptable for non-sovereigns to demand a share in the spoils of government than to demand a share in the actual decision-making of government.

To do that I had to classify those people who have power₁ to make demands on government, but who don’t use that power₁ to actually share in power₂ by influencing government policy. I need a different word to distinguish the capability to influence policy from the exercise of that capability. I would like to call the first “potential power”, except that Etymology Man would come crashing through the window, and it’s too cold in here as it is.

The best I’ve come up with is “Basic power” versus “Political power”. So I can say that those with basic power owe loyalty to the sovereign, but can expect to be rewarded for that loyalty. Any attempt to gain political power, rather than wealth and status, is disloyalty, and should be opposed by all right-thinking people.

The terms aren’t really obvious though, and I’m hoping to find better ones.

Honour Given and Taken

Not long ago, Fred Goodwin was a Knight, his successor Stephen Hester was in line for a £900K bonus, and Chris Huhne was a cabinet minister.

It would be neat in a literary way to show that these three withdrawn honours are part of the same thing, but it’s more interesting, and more true, to see how they’re all different.

Going in reverse chronogical order, Huhne is in some ways the most straightforward. He was in a position of trust, and he is accused of criminal dishonesty.

On more detailed reflection, oddities emerge. For one thing, while it would be nice to think that laws and policies are being made by people who are honest and trustworthy, the idea that any of his rivals or colleagues are honest enough to admit their mistakes or crimes is laughable.

For another thing, why is it the decision of the police to prosecute that triggers his resignation? The facts are not really any better known than they were before.

I suspect that what forced him out was the media deciding to claim that he must be forced out. That doesn’t necessarily indicate any particular animus to him on behalf of the media; a cabinet resignation is worth pushing for just for story value. It might be that earlier, there were reasons for the press not to try to do him in, but those are now gone.

I could suggest a couple of possible reasons: one is that the media seemed somewhat invested in the coalition, but is now more soured on it. (The 2010 story of David Laws tells against that theory somewhat, but he might have been more specifically unpopular to the media). Another theory might be that Huhne’s activity on climate change protected him, but that has mysteriously become less of a concern.

Ultimately, I don’t think we can know what’s really going on, and that’s why day-to-day party politics isn’t worth paying attention to.

On to Goodwin then. On the one hand, if Goodwin was rewarded for benefiting British Banking, it is fair to say that the any benefit he bestowed was more than undone. On the other, the whole process did not seem to have much to do with either justice or wise decision-making; rather it had all the appearance of a stampede.

Whatever knighthoods are for these days, it can’t be what they were originally for. It’s a bit murky. Interestingly, knighthoods would fit well into a formalist system, as a treatment of the coalition problems I just wrote about. It could serve as a formalisation of informal power: a recognition that the recipient has some power, is loyal to the sovereign, and is being rewarded for that loyalty. If that were the basis of honours, they would not be withdrawn for incompetence, or even for criminality, but only for disloyalty. It would mean that that person ought not be permitted to obtain any power again.

Finally Hester. Hester is CEO of a bank which is making modest profits in a difficult market. As such, he would normally expect a substantial bonus. The same stampede which took away his predecessor’s knighthood took that as well.

There are legitimate questions about the amount of money made by banks and their employees, which I am not going to address — anyone worth reading on the issue would be either more knowledgable or less personally interested than me.

The question of bonuses per se is a separate one, though. What it amounts to is that companies that award large bonuses (relative to salary) are run in a more formalist manner than most other corporations. In many organisations, valuable employees are rewarded with more responsibilities, or better job security. Arnold Kling recently raised the point that this can produce bad outcomes. These companies avoid that, giving responsibilies as tasks rather than rewards, and rewarding valuable employees more directly with cash. This is the appropriate response to the sort of issue that Arnold Kling raised, and which Aretae picked up on as a widely applicable example of bad governance.

The fact that this formalist measure to improve governance arouses such opposition (again, independently of the actual sums involved; Hester’s salary for 2011 was over a million pounds, and attracted little attention), says a lot about what is wrong with modern political culture.

So, three very different honours: a minor position in our corrupted and ineffective system of government, an anachronism that might once have been a formalist recoginition of power and reward for loyalty, and a straightforward, honest payment for value. All removed, for better or worse, in the same way, by an unthinking popular stampede, triggered by a media driven not primarily by ideology but by a need for drama.

Formalism and Coalition

Aretae insists that all government is coalitional.

Maybe so, but that doesn’t mean it’s a good thing to widen the coalition further, and spread power about randomly.

The point of formalism is that power should be aligned with some form of responsibility, so that the powerful not benefit from destructive behaviour, and that attempting to obtain more power should be illegitimate, so that energies not be directed to destructive competition for power.

Formalists tend to believe that stable, effective and responsible government would follow a largely libertarian policy, choosing to limit government action to maintaining order and protecting private property, and taking its own loot in the form of predictably and efficiently levied taxation rather than by making arbitrary demands of random subjects. Such a policy would maximise the long-term revenue stream from the state.

Given a policy which sets limits on government, it becomes reasonably straightforward to deal with those centres of power which are not sovereign but which cannot be eliminated. They get subsidies, but not power over policy. Given that the sovereign chooses, for reasons of efficiency, to take taxes and buy food with them rather than to take food directly from whereever he fancies, there is no problem in giving pensions or subsidies to those whose support is needed.

The key formalist idea is that if those with informal power go beyond what they are entitled to but seek to influence general government policy, then they are doing something anti-social and immoral. All those who have an interest in the continuation of stable, effective and responsible government will see such an attempt as a threat. Fnargl does not have a ring, and I do not much fancy engineering weapon locks implementing a bitcoin-like voting protocol, so a combination of popular will and, in due course, force of tradition is all we have to fill the gap. In as much as there is a general interest in anything, there is a general interest in good government, and I do not think it is all that far-fetched to to see sovereign authority as something that people will reflexively stand to defend, were it not that that they have been taught for 250 years to do the opposite.

What’s striking is that our current political morality holds the opposite view: that attempting to influence policy is everyone’s right, but to receive direct payoffs is unjust. The powerful are therefore rewarded indirectly via policies with enormously distorting effects on the economy or on the administration of government, whose general costs greatly outweigh the gains obtained by the beneficiaries. Further, it is easier for them to seek to protect and increase their power, than to seek reward for giving it up, even if the general interest would benefit from the latter.

I could do with an example to illustrate this — if a person has necessary power, such as a military officer, then he should keep his power and be rewarded for it. If alternatively his arm of the military is no longer needed, but he still has power because he could potentially use the arm against the sovereign, then it is preferable to pay him extra to cooperate in disbanding the arm, rather than to maintain it just to keep him loyal. The same logic might apply in the organisation of key industries, or sections of the bureaucracy.

It would not necessarily be easy to resolve these things perfectly, but it would be made easier by recognising that concentrating power over general policy — sovereignty — is a good thing, as far as it is possible, and that the sovereign who has control over policy has the right to use it in whichever way he sees fit: to hand out cash presents as much as to award monopolies.

The exercise of democracy makes things very much worse, by adding to the number of those with necessary power anybody who can sway a bloc of voters, and enabling them to make demands for more inefficient indirect sharing of the loot.