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Booksellers versus Bestsellers

  • Liberalism and capitalism, freedom and markets

    From Transition, a newsletter of the World Bank, Number 5-6, May-June 1996, page 15:
    "With a view to corporate takeover, Volkswagen AG sent a Herr Heuss to Zwickau to find out how the Trabants (relatively cheap East German cars) were made there. He emerged shocked from the huge plant, babbling "My God. The Trabant operation was value-subtracting: valuable material, labor, and capital inputs went in at one end; shabby Trabies came out at the other, their bodies made from compacted trash. The final output was worth less than the sum of the inputs. What was not fully understood at the time was that East Germany's whole economy was value-subtracting and cost-unconscious."

    Communism produced somewhat more stable governments than fascism, but worse economic results. And both produced atrocities, from the German Holocaust to the killing fields of Cambodia.


    Liberalism, because it is democratic, is more flexible. Leaders who fail can be cast aside without violence. If the system is not producing just outcomes, the system can be changed.


    There seems to be confusion on the right as to the difference between social democracy and socialism. Social Democrats are a group of liberals who believe in private property and markets, but want a strong social insurance program to soften the consequences of capitalism. Communism is a kind of socialism that regards it as important that society, usually in the form of the state, should own the means of production. (Marx proposed eliminating property entirely, but since property is the rules, obligations, and rights about how people use objects, this is impossible, as long as people use objects. This basic failure to understand the nature of property is part of the reason for the failure of Marxism.)


    Social Democrats, then, are those who wish to preserve capitalism through forms of social insurance that make the system sufficiently just in its outcomes to avoid social unrest. Both fascists and Communists considered them enemies, and suppressed them, in part because they try to achieve their aims by democratic means.

    Fabian socialists tried a different approach, trying to institute the social ownership of the means of production by democratic means over a long period of time. When state-owned industries in Britain proved economically unworkable, their project was ended by democratic means.

    Some will say that laissez faire capitalism is an alternative, but I doubt this has ever really been tried. We were still in a mercantilist system when the Grange movement started advocating for anti-trust laws, so we went from the state supporting industry under mercantilism to regulated business without a real laissez faire moment between. In fact, industry still depends upon state aid in matters of credit and infrastructure. The closest we came to laissez faire capitalism was the Gilded Age of the 1880 and 1890s, which produced enough unrest to produce the labor movement and the Grange movement.

    Laissez faire capitalism is close to the ideal of libertarianism, but there was substantial government interference in contracts between labor and industry, if favor of industry. Like Marxism, the purist ideal of libertarianism would be the withering away of the state, and this is no more practical than than the Marxist ideal of communism without a state. Even most libertarians understand that the state is needed to guarantee property rights.

    The problem they face is that markets are as much a human invention as governments, and it's difficult to see why, therefore, markets should be privileged.over other institutions.

  • The industrialization of democracy

    by John MacBeath Watkins

    For most of human history, we have beer ruled by force, faith, and convention. Enlightenment thinkers thought they could do better, by coming up with a form of society that would be better suited to humanity. One might think that as our way of life has changed, our form of government would need to change, and it has.

    At the time when Enlightenment thinkers were inventing liberalism, one of the few examples around of a democratic society was Switzerland.

    The Swiss cantons were predominantly occupied by people who owned small farms. During the middle ages, they were famous for producing pikemen who could stand up well to cavalry. Jean-Jacques Rousseau, who was Swiss, considered the Swiss way of life ideal for democracy. There was an equality of means between the farmers, and the technology that they employed in warfare did not require the investment in armor that tended to result in rule by aristocracy elsewhere in Europe.

    This is part of the reason the founders of the United States designed a democratic republic, rather than a direct democracy. The economy of the U.S. varied from Maine fishermen who caught lobster from a small boat to planters like George Washington and Thomas Jefferson, who owned large estates worked by slave labor. Everything they read from the great thinkers of their day and the ancient Greek philosophers said that a large and varied country needed to be guided by the wise men.

    However, they chose to have those wise men selected by the voters. They left it up to the states to decide who could vote, and in the beginning it was mainly men with property. (Not women, and not men who were property.)

    But our country has become more democratic over time. Where the constitution originally said that state legislatures would select U.S. senators, that system was found all to easy to corrupt. In 1899, William A. Clark simply paid Montana state senators to vote him into office as a U.S. senator. The senate refused to seat him after the scandal broke, This resulted in the 17th Amendment, which provided for direct election of U.S. senators.

    In 1800, 83% of Americans were engaged in agriculture. Currently, about 2% of the American population are farm families. Capitalism, a term not invented until 1850, has transformed our way of life, yet we still manage under the same old constitution. How is this possible?

    The answer is that we have marvelously flexible institutions which have managed to change as society changed.

    Not everyone has been happy with that. Andrew Jackson, president from 1829 to 1837, was a great believer in democracy, and the extension of the voting franchise to the common man -- that is, all white men. He envisioned a country of yeoman farmers, provided with land by removing Indians and colonizing their land.

    This went with a version of values favored by the physiocrats, claiming all real value came from working the land. He feared moneyed interests would undermine republican values. It's all too easy to connect the term "republican values" with the values of the Republican Party, but that's a very different thing.

    Republican values, to a person of Jackson's day, were the values of a virtuous citizen. Such a citizen exemplified civic virtue and patriotism above greed and power. John Adams, the second American president, said the following in a 1776 letter to Mercy Warren:

    "The Spirit of Commerce, Madam, which even insinuates itself into Families, and influences holy Matrimony, and thereby corrupts the morals of families as well as destroys their Happiness, it is much to be feared is incompatible with that purity of Heart and Greatness of soul which is necessary for an happy Republic."Adams ended that letter with the following:

    "Every man must seriously set himself to root out his Passions, Prejudices and Attachments, and to get the better of his private Interest. The only reputable Principle and Doctrine must be that all Things must give Way to the public."
    Good luck with that, Mr. Adams.

    Jackson worried so much about the monied interests that he took some steps, such as not renewing the charter for the Bank of the United States, and requiring that payments made for government land had to be made with silver or gold coins, and eliminating the U.S. government debt, that sent the nation into an economic crisis. We didn't have a proper central bank again until 1913, by which time it was evident that we needed some means of dealing with financial panics.

    The fact is, our democratic republic has had to adapt to enormous changes in the way we live, and has also changed the way we think about ourselves. More and more people have had their humanity recognized, if you like, the ownership of their own souls and the equality of all people before the law in such areas as voting, holding property, and marriage.

    Groups who once counted toward the distribution of power, but were not allowed to vote, have gained the ability to have a say in who governs them and how.

    Representation had to become more democratic, because our ideas about humanity changed. When John Locke was writing, society in general accepted the notion that the head of the household should represent the household. Now our ideas are in accord with the reality that women have strong minds and strong opinions, and wish to speak for themselves. We stopped accepting slavery as an institution, because Locke's philosophy permeated our society with the notion that we each own ourselves.

    We quite rightly worry that our current way of life leads to great inequality, but what could be more unequal than slavery? We have had undemocratic representation from the first. What we have now are huge differences in the wealth of voting members of society, and a far more urban way of life than the founders could have envisioned.

    The urbanization of society tends to warp the issue of representation, because apportioning districts tends to favor rural populations. Those whose concerns are urban are, by the very nature of cities, concentrated in a smaller space than those with rural concerns.

    Another issue is that the vision of a nation of yeoman farmers people like Andrew Jackson wanted is long gone. Most people work for wages, which goes against the old tradition of American individualism.

    In the 19th Century, there were radical individualists who believed that working for wages was no better than slavery, and invented the term "wage slave" to make their point. This was the theory of liberty that C.B. McPherson called possessive individualism, the idea that liberty consists of freedom from dependence on the will of other people. We still hear echoes of this in, for example, former President George W. Bush's use of the term "ownership society."

    Tom Palmer at the Cato Institute, and advocate of Bush's policies, put it this way:

    As the American Founders knew and as generations of serious students of society have long known, an ownership society is a society of responsibility, liberty, and prosperity. A number of policy initiatives - including creation of personal retirement accounts, expansion of medical savings accounts, and school choice - have been proposed recently that seek to strengthen an "ownership society." Such initiatives build on a long and deep tradition.Port of what Palmer was referring to was Bush's poorly-received plan to remake Social Security. Social Security Insurance has always acted as insurance -- those who can work pay into the fund from which those who can no longer work are paid. Bush proposed to turn it into sort of a saving program, which would have meant that somehow, we would have to pay Social Security benefits for retirees while working people would be paying into retirement savings plans. As it happened, there already was a program for retirement savings plans called 401(K) accounts, and the plan was financially unworkable in any case.

    Palmer attributed the "ownership society" tradition to the founders, but as we've seen from what John Adams wrote, some of them were big believers in personal sacrifice and public service. He was also a big advocate of strong central government. Adams even pushed through the Alien and Sedition Acts, a horrible law which, among other things, resulted in the arrest of 20 newspaper editors who opposed Adams.When Jefferson became president, he pardoned those serving time under the law and made sure their fines were repaid. The law is now considered unconstitutional.

    The sort of possessive individualism that Palmer and Bush admired had more to do with the tradition of Adams' opponents, among them Thomas Jefferson. Jefferson, and later Andrew Jackson, advocated a different sort of country with the ownership of property the key to liberty.

    This fit with the notion of manifest destiny, in that people could have land by homesteading the land formerly occupied by Indians.

    There were a couple of problems with this. The Indians did not willingly give up their land, so the U.S. military had to take it from them by force. Homesteaders may have felt they were building a new life for themselves by the sweat of their brow, but the thing that made that possible was a major government initiative to conquer the land they homesteaded. And the logistics that made the settlement possible started with clipper ships and Conestoga wagons, but getting their crops and cattle to the cities of the East required the construction of railroads.

    Some of the more important railways were built with government loans and on land grants given to them by state and federal governments. About 9.5 percent of all federal land was granted to the railroads between 1850 and 1870. The railroads then sold off much of the land to help defray the cost of building the railroads. Once the main lines were in, private capital built the rest of the railroads, so that only about 8% of American railroads were built with government loans and land grants -- but they tended to be the most important ones.

    All this was in aid of a vision of America as a country of small farms. And it was such a country. It wasn't until about 1920 that more people lived in and around cities than lived in the countryside. Now, about 80% of American live in urban areas.

    One major problem with the 19th century version of radical individualism was that most people working for wages don't feel they are slaves. People often quit their jobs if they don't like them. As a bookseller, some of my best and most loyal employees have been people I hired after they left their previous jobs in disgust. For an employer competing for smart, honest, hard-working people, treating people well turns out to be a competitive advantage.

    The other problem with this idea is that it doesn't fit with capitalism. One of the distinguishing features of capitalism is that it produces large enterprises which invest funds in the means of production, and hire people to do the work. Jacksonian democracy would have seen this as inevitably undermining the virtues of the republic and its citizens.

    One answer to that was to get the workers representation through organizing unions. And, when unions were strong, they produced a society with greater equality of incomes than America had before or since then.

    Part of the reason this could happen was a moral climate that opposed an economic aristocracy. In a reaction to the inequality and abuse of workers seen in the Gilded Age, top tax rates were raised so that a tiny number of very rich people were subject to a 90% tax rate, and inheritance taxes aimed to make it harder for families to accumulate great wealth and power. It didn't take William Clark buying a seat in the U.S. Senate to convince people that wealth equaled power, there were plenty of other examples.

    But since 1970, there has been a political movement to increase inequality.


  • On undemocratic representation and the 3/5 Compromise

    by John MacBeath Watkins

    When the founding fathers wrote the constitution of the United States, one of their models was the Roman republic. Another source of information for them was Aristotle's Politics, which advocated the republic over pure democracy.

    But here's the problem. The Roman senate was, for the most part, not democratically elected. It was
    more like England's House of Lords than the House of Commons.

    And the story of the evolution of American government has been one of the battle between those who want to restrict who chooses representatives and those who want to widen the franchise.

    Qualifications for voting are largely left up to the states, or were, until after the Civil War. Women could not vote, in many states, felons still cannot vote.

    But the thing is, women and felons were counted in the census, and contributed to the number of representatives states had in the House and how many electoral college votes states had for electing a president.

    The founders supposed that we would elect wise men to gather and decide who the president should be. As far as I can tell, the system never actually worked that way.

    Slaves could not vote, but were counted for census purposed as 3/5 of a human being, so they increased the leverage of slave-state legislators and electoral college representatives, who represented them by opposing the abolition of slavery.

    Following the Civil War, federal troops during Reconstruction enforced the right of former slaves to vote. But when Reconstruction ended, Jim Crow laws ensured that blacks could be denied the vote.

    This led to a long period when blacks were counted for census purposes as full human beings, but were not allowed to vote as such in many states. The result was a Southern congressional delegation strengthened by the number of black voters in their districts, but elected to work against their interests.

    The civil rights movement sought to end this, and with the 1965 Voting Rights Act, it looked as if the Justice Department was back in the business of defending the right of African Americans to vote.

    That sparked anger in the South, and when Richard Nixon set out to remake the Republican Party in his image, his genius for exploiting resentment came to the fore. The Republican Party now dominates the South, and the South dominates the Republican Party.

    So, it's not too surprising that the Republican Party is now in the forefront of trying to limit the voting franchise, just as Southern Democrats used to. Their anti-government message isn't what the Republican Party has always represented. Most of the rhetoric about small government started with the 1964 Civil Rights Act and the presidential campaign of Barry Goldwater, who opposed it.

    Republicans worked for years to get enough conservative Supreme Court justices to pull the teeth of the Voting Rights Act of 1965. Their most notable success to date was the 2013 Shelby County, Alabama, decision which removed the provision requiring districts and states with a history of racial discrimination in voting which required them to get prior approval from the Justice Department for changes in their voting laws.

    Texas immediately went forward with a voter identification law which experts said would mainly make it harder for African American and Hispanic voters, and to some extent students.

    Texas was allowed to use this law in the 2014 election, but it is still going through a long process of legal challenges. The law has plenty of imitators, particularly in the South.

    The rapid population growth in Texas is something its government brags about, but the problem is, its government is dominated by a party that is not the choice of the group of people driving this increase -- Hispanics. So, they attempt to gain that tempting goal, representing people who aren't allowed to vote.

    Voter ID laws are sold on the thin premise that there is a plague of vote fraud in the form that this would address, but those pushing such legislation have not produced evidence of anything of the sort. The intent is clearly to get back the old advantage the South had when the 3/5 Compromise gave them disproportionate clout in proportion to the number of voters they had.

    Garry Wills, writing in his 2005 book, "Negro President": Jefferson and the Slave Power, said without the 3/5 Compromise,
    "slavery would have been excluded from Missouri ... Jackson's Indian removal policy would have failed ... the Wilmot Proviso would have banned slavery in territories won from Mexico ... the Kansas-Nebraska bill would have failed"In addition to the slavery issue, men were expected to represent women when the nation was founded. The notion that women should be allowed to vote, as well as being counted in the census for purposes of deciding how many House representatives and electoral college votes a state would have, gained some ground by the late 19th Century, with several Western states allowing them the franchise, but the 19th Amendment, which gave all women in America the vote, did not become law until 1920.

    The cultural context is that men were considered to represent their households. Under the doctrine on feme covert, women were considered for property purposes to be one with the man's household, and subordinate to him. The wife therefore had no property of her own, and if she divorced, all property of the household, even that which she brought to it, would stay with the husband.

    Husbands representing households was about property and subornation. When the nation was founded, only holders of sufficient property could vote. The property qualification for voting did not entirely disappear until 1856 in the U.S. It does not seem like any sort of accident that women got their property rights before they got the vote. Some things are deeply embedded in the culture.

    In general, the policy of assuming that some classes of people, such as slave owners or husbands, should represent other people has run aground on the simple fact that they represent their own interests, not those of their slaves or wives.

    But that's the point of restricting the franchise. Those who wish to limit the voting franchise usually want to do so in order to use the legislative power granted by a population against its interests.



  • Reflections on the revolutions in America, and France

    by John MacBeath Watkins




    Reflections on the Revolution in France, published in 1790, is one of the core documents that defines conservatism. Edmund Burke wrote it in 1790 in response to the chaos he saw happening across the English Channel.

    But why did he not write this sort of thing about the American Revolution, which had happened earlier?

    One reason is that the American Revolution was a kinder, gentler, sort of war. In France, anti-clerical and anti-aristocracy feeling was part of the source of the problem. In America, there was no national established church, and no hereditary aristocracy.

    In France, the clergy and the aristocrats had so many tax exemptions, most of the taxes fell on

  • Used bookstore, threat or menace?

    by Jamie Lutton

    I found out that not every Chamber of Commerce in the Greater Seattle area like the idea of having a used bookstore in the their neighborhood.

    I was discouraged directly via email by a member of the Chamber of Commerce of a that is community part of the greater Seattle a few days ago, as a follow up to an email inquiry I had made.

    My company was considered too great a threat to the neighborhood's new book shop, and besides that I am an ''outsider' This is how it went: This Chamber of Commerce of this neighborhood was emailed by me asking if they thought that a used bookshop similar to the one I run and own on Capitol Hill would be welcome in their neighborhood. I was hoping for leads on buildings or landlords who would welcome a tenant like me. Also, wanted to be 'friendly' and get to meet the Chamber of Commerce. I got a swift reply back saying that the Counsel member had been in my bookstore.and that because they had a new bookstore, they did not need a used bookstore: here is the reply I got,verbatim with the names of the location and the agent redacted.

    "I'm not sure how much you know about our local bookstore, but I would suggest you talk to (xxx) the current owners. You've probably met (xx) They know the business and the xxxx very well. While they don't have a used book section, they do rare book searches for customers and have a very loyal client base for that service. XXXX is masterful at searching and tracking down books for people.
    As a resident, you're aware of the on-going efforts to keep people shopping locally, i.e. X Books has worked hard to promote that philosophy, establishing long-standing relationships with the schools, non-profit organizations and the residents. It has been very supportive of community and the community is very loyal to X Books."


    So, basically.....go away. We don't want you here! you are not one of us. My business partner, John Watkins, helped draft a satirical response:
    "Dear Xxx,Thank you for your response encouraging me to start a used bookstore in XXX. Yes, I have met X, and liked her a lot. I hope I can have as good a relationship with her as I do with other booksellers in the area.I'm encouraged to hear that X Books has a good relationship with the community, and hope to be at least as warmly welcomed by other as I have been by you. Chambers of Commerce typically do welcome new businesses, but I'm sure I'll have to win the loyalty of new customers by providing good service and filling needs not currently filled.As an xxxx resident, of course I want to help people shop locally. That's why I'd like to start a store that, as you point out, is in a niche not currently filled. Thank you for confirming that Xbooks does not have a used book section. I'm sure customers will be delighted to be able to buy out of print books off the shelf rather than waiting for them to be ordered, which, as you have pointed out, they must now do.You said the community is very loyal to xxxx books. That seems to imply that I should locate my store close to it. This is the sort of valuable advice I came to the chamber to seek. The suggestion is welcome.

    Thanks,Jamie"


    This is what I got back:

    "Jamie,
    I'm afraid you may have misunderstood my note. I was neither encouraging or discouraging you from starting a bookstore on the Island. That is a decision you must make. I was also remiss in not including information about sources of used books on the Island. I was thinking in terms of X Books, but after I sent you the note I remembered that the (name of the local thrift shop) sells used books and a great many of them. They even sell them on E-Bay. Additionally, the Friends of the Library has quarterly sales of used books and raises quite a bit of money at those sales. I'm not sure how large the niche for used books is on the Island but there are already two well established sources for them and sales from both sources benefit Island non-profit organizations.
    I apologize for any misunderstanding.
    Xxx"

    So, I note again that she came into the Capitol Hill Twice Sold Tales and met me, looked around.

    I jokingly surmised Xxx must have though I was a "lesbian, anarchist or a socialist" something
    threatening to xxxx middle class values, and both prospects xxx felt were a menace to her neighborhood.

  • Polygamy, gay marriage, and the liberal mindset

    by John MacBeath Watkins

    For a lesson in traditional marriage, we should, I suppose, look to the Bible.

    King Solomon is said to have had 300 wives. I have, in a previous post, pledge to settle down and get married as soon as I find the right 300 women to allow me to marry in the traditional style (that is, always outnumbered, always outgunned,.)

    But although the Bible is replete with references to polygamous marriage, modern Americans are more comfortable with the notion of gay marriage, which is mentioned nowhere I know of in the Bible.

    There are practical reasons for this. Conservatives fighting against gay marriage found it difficult to find proof that children raised in such households are harmed by this. Opponents of polygamy seem to suffer from no such difficulty. Communities that practice polygamy have been accused of forcing under-aged girls into marriage with older men, exploiting children and having them do unsafe work, being abusive to children, and kicking teenage boys out of the community when they start showing an interest in girls so that the girls will be available to older men. The boys are shunned by their families and forced to live in a world they know almost nothing about outside the community.

    But I don't think such practical matters are really the key to why polygamy is less acceptable than gay marriage.to the modern Western mind.

    The key is a revolution in how we think of people, codified by the philosophers of the Enlightenment, and especially the thinkers of liberalism.

    Thomas Hobbes laid out a new system of value in Leviathan, published in the mid-17th century. He said that "The 'value,' or 'worth,' of a man is, as of all other things, his price; that is to say, so much as would be given for the use of his power; and therefore is not absolute, but a thing dependent on the need and judgment of another."

    That sounds horribly philistine, but what was revolutionary was the last clause in that complicated sentence, in which he proposed a subjective system of value. We were now to be valued by each other, not by the priest or by the position of our birth.

    John Locke, writing at the end of the 17th century, noticed that not only did we value each other, our relationships were often subject to the rules of property. The master of a household had something like a property right to those within it under the law of his time.

    A married woman, for example, was regarded as a "feme covert," that is, she became, for property purposes, one with her husband, and subordinate to him. (A widow would be a "feme sole," in charge of herself.) If a woman at that time (and in fact until the late 19th century) in England held, for example, a copyright, it passed to her husband when she married and would not be returned to her if she divorced. In fact, all of the household's property remained with the husband, and a divorced woman would usually be impoverished unless a very good prenuptial agreement were negotiated.

    Property was also connected intimately with the notion of citizenship. To vote in England at the time, you had to own property.

    Locke's Second Treatise of Government contained a ticking time bomb. He proposed that we all own property in our own person, and cannot alienate -- that is sell -- that particular property. Every person, therefore, had inalienable property rights to themselves, that is, we are each of us our own master.

    All that remained was to decide who was a person. A dawning realization that slaves are people meant that they must logically be their own masters, and slavery must be immoral. The Women's Rights movement brought about property rights for married women before it brought them the vote. The Married Women's Property Acts were not completed in England until 1882, though earlier acts had set the pattern.

    But polygamous marriages worked, to the extent they did, because women and children were regarded as property of the master of the household. If wives are recognized as their own "master," this relationship no longer exists.

    The term "feme covert" seems at first glance to have promise. One pictures a Thurber cartoon, with the wife in ninja clothing and the ineffectual husband looking on, the caption reading, "When you married me I was a blushing maid, but now I am a feme covert, Mr. Johnson!"

    One of Thurber's main themes was "the war between men and women," which he seems to have lost to his domineering first wife. But by then, the feme covert was a thing of the past, community property was the future.

    We still see conflict over the nature of marriage. Traditionalists still advocate "traditional marriage,"
    sometimes even polygamous marriage. What they mean by this is a return to the concept of the feme covert, subordinate to her master. It is no coincidence that the same people often worry about keeping control of their children, worried that exposing them to public schools would cause them to learn things they shouldn't know, like evolution, and expose them to a system of values that would be distressingly modern. This could give them dangerous ideas of autonomy.

    Birth control has meant that marriage doesn't have to be about child rearing, and many of the tasks of the household that used to consume a great deal of women's time, like spinning and weaving and sewing clothing, have been moved outside the home. Marriage is less about property and child rearing than it has ever been before, and more about love, and a partnership between equals.

    As people are recognized as equals, old barriers have fallen. Miscegenation laws fell because, if African Americans are not a lesser race, why should they not marry whites? As the humanity of homosexuals has been recognized by society at large, the question comes up, why should they not marry who they love?

    What was once common knowledge, that the master of the household is the master of all within it, has fallen before the revolutionary idea that we are all our own masters. Few people have read Hobbes or Locke, but their ideas permeate our society and are still reshaping it. Ideas travel though a society less by formal indoctrination than by a sort of mimetic contagion. It is :"common knowledge" now that we are our own men and women, when in an earlier age, it was common knowledge that this was not the case.


  • The intersection of virtue and power, and the justifications of policies related to race.

    by John MacBeath Watkins

    For much of human history, we have been ruled by faith and force. It's easy to understand why force -- the king with his troops -- can rule, but why is faith so important?

    Faith is about how we should live. And one of the functions of those who are in charge of faith is to decide who is virtuous, and what actions are virtuous. That is a powerful thing: It means those who interpret virtue can say who is acting rightly, and who is not.

    We like to believe we live in a just world, in which virtue is rewarded and vice punished. In a way, the arbiters of what is virtuous are there to reassure us that the world is unfolding as it should. But they are also meant to be a check on those who cheat.

    It is therefore in the interest of those who succeed to influence the perception of virtue so that their gains are not regarded as ill-gotten. Kings would rather you believe they ruled by divine right -- the will of God -- than that they simply control a lot of soldiers. The rich of the Gilded Age liked to believe they were the product of social Darwinism, that their wealth was a sign that they were fitter than the poor, just as our modern-day rich like Objectivism, Ayn Rand's reboot of social Darwinism without the bogus biology.

    Rand is an interesting case in the study of virtue. She did, after all, write the book on The Virtue of Selfishness. Rand admired the psychopathic killer Edward Wayne Hickman, because of his selfishness and unwillingness to be bound by social conventions such as not killing people.

    Her ideas matured, of course. From the Ayn Rand website (original appearance was in an appendix to Atlas Shrugged:):
    Man--every man--is an end in himself, not a means to the ends of others; he must live for his own sake, neither sacrificing himself to others nor sacrificing others to himself; he must work for his rational self-interest, with the achievement of his own happiness as the highest moral purpose of his life. Thus Objectivism rejects any form of altruism--the claim that morality consists in living for others or for society.This is a nice philosophy for making a virtue of not helping others, which is fine if you have a nice life and don't wish to be bothered about those less fortunate. This is true not just between rich and poor, but between those advantaged by their race and those disadvantaged by it.

    In reality, Rand's notions about morality make no sense in terms of the way people live their lives. Most parents would sacrifice a great deal for the sake of their children, a characteristic that is hardly unique to humans.

    Rand's is a philosophy compatible with narcissism and psychopathy, and has no room for idealism, patriotism, or noble self-sacrifice of any sort. It does, however, fit perfectly with the age of the corporation as it now exists.

    There was a time when corporations were managed as if they were a person, with shareholders, bondholders, customers and employees all considered as stakeholders. The switch to managing for shareholder value, which started in the 1970s, has remade corporations into a different kind of organization, closer to the Ayn Rand ideal of the selfish individual. And this new version of the right actions for a corporation appear to have seeped into the rest of the culture, with some surprising groups adopting its justifications and notions of what are right actions.

    The rise of a libertarian right has given us an entire political movement built around this rather strange notion of virtue. This movement is the strange bedfellow of Christian conservatives who believe Christ dying for their sins is the essence of morality and paleoconservatives who believe in patriotism and the nobility of going to war and becoming a hero.

    Our political divisions are as much moral as anything else, but there are deeper and darker emotions at work. To some extent, the morality of libertarians, Christian conservatives, and paleoconservatives are a sham and a justification for things less obviously related to virtue.

    When Barry Goldwater, in his 1964 run for the presidency on the Republican ticket, opposed the Civil Rights Act on libertarian grounds, he did something a large part of the country wanted, regardless of how it was justified: He took a stand against civil rights. Strom Thurmond, who ran for president in 1948 on the States Rights Democratic Party ticket, preaching segregation and taking 39 electoral college votes, became a Republican.

    Richard Nixon, sometimes called "the last liberal" for his actual policies, pursued a Southern strategy for election, and continued a transition that made the Republican Party the party of the South.

    Now, it's easy to see how paleoconservatives would be attracted to a party that opposed the Civil Rights Act (many northern Republicans had voted for it, but having Goldwater at the top of the ticket opposing it changed how the party was perceived.) But why would Christian Conservatives be attracted to such a party?

    Well, one thing that happened after the Civil Rights Act passed was integration of public schools. And white parents who didn't want their kids in schools with blacks started sending them to a new crop of private schools, colloquially known as "white academies." And many of those were associated with white Evangelical churches. When the nonprofit status of those schools was threatened by a crackdown on those that existed entirely to segregate, those churches became interested in politics, and in limited government.

    The libertarian/small government justification for fighting federal efforts to desegregate and put an end to Jim Crow was also attractive to rich people who wanted to pay lower taxes. It was easy enough to demonize government spending if such spending was thought to help Those People, and another group fastened onto the libertarian justification machine like remora on a shark.

    Because this is what happens when virtue bestows power. You have to put forward a moral justification for your political movement, and "government is the problem, not the solution" sounded so much better than the 19th century justifications that were no longer acceptable.

    Alexander StephensConsider an excerpt from the "cornerstone speech" of Alexander Stephens, vice president of the Confederate States of America, in 1861:
    The prevailing ideas entertained by him (Thomas Jefferson) and most of the leading statesmen at the time of the formation of the old constitution, were that the enslavement of the African was in violation of the laws of nature; that it was wrong in principle, socially, morally, and politically. It was an evil they knew not well how to deal with, but the general opinion of the men of that day was that, somehow or other in the order of Providence, the institution would be evanescent and pass away. This idea, though not incorporated in the constitution, was the prevailing idea at that time. The constitution, it is true, secured every essential guarantee to the institution while it should last, and hence no argument can be justly urged against the constitutional guarantees thus secured, because of the common sentiment of the day. Those ideas, however, were fundamentally wrong. They rested upon the assumption of the equality of races. This was an error. It was a sandy foundation, and the government built upon it fell when the "storm came and the wind blew."Our new government is founded upon exactly the opposite idea; its foundations are laid, its corner- stone rests upon the great truth, that the negro is not equal to the white man; that slavery -- subordination to the superior race -- is his natural and normal condition. [Applause.] This, our new government, is the first, in the history of the world, based upon this great physical, philosophical, and moral truth. This truth has been slow in the process of its development, like all other truths in the various departments of science. It has been so even amongst us. Many who hear me, perhaps, can recollect well, that this truth was not generally admitted, even within their day. The errors of the past generation still clung to many as late as twenty years ago. Those at the North, who still cling to these errors, with a zeal above knowledge, we justly denominate fanatics. All fanaticism springs from an aberration of the mind -- from a defect in reasoning. It is a species of insanity. One of the most striking characteristics of insanity, in many instances, is forming correct conclusions from fancied or erroneous premises; so with the anti-slavery fanatics; their conclusions are right if their premises were. They assume that the negro is equal, and hence conclude that he is entitled to equal privileges and rights with the white man. If their premises were correct, their conclusions would be logical and just -- but their premise being wrong, their whole argument fails. I recollect once of having heard a gentleman from one of the northern States, of great power and ability, announce in the House of Representatives, with imposing effect, that we of the South would be compelled, ultimately, to yield upon this subject of slavery, that it was as impossible to war successfully against a principle in politics, as it was in physics or mechanics. That the principle would ultimately prevail.History can change suddenly, but culture changes slowly. Beliefs such as Stephens voiced did not die with him, they live on, and are part of what many people think of as "right." Those people are now aware that their language and justifications have to change, even as their attitudes remain the same.
    Lee Atwater, a Republican political strategist who worked for Ronald Reagan, put it this way in 1981:You start out in 1954 by saying, "Nigger, nigger, nigger." By 1968 you can't say "nigger"--that hurts you, backfires. So you say stuff like, uh, forced busing, states' rights, and all that stuff, and you're getting so abstract. Now, you're talking about cutting taxes, and all these things you're talking about are totally economic things and a byproduct of them is, blacks get hurt worse than whites.... "We want to cut this," is much more abstract than even the busing thing, uh, and a hell of a lot more abstract than "Nigger, nigger."The conversation changes, new arguments about what is right action, but the old motivation are behind the new justifications. This is the corruption of virtue in the pursuit of power: People who cannot any longer justify the policies they want in honest terms find dishonest ones to make their intentions seem virtuous. One might call it policy laundering; a policy that can no longer be justified by its original moral logic seeks new moral logic to make it seem acceptable.

    This is a mask of virtue on the face of an ancient evil, an effort to make a carnival of matters of conscience. But in the end, can they war successfully against a principle of politics? Can the notion that some people aren't worth as much as others because of some feature they cannot control, such as the color of their skin, triumph over the principle that "all men are created equal"?

    "The arc of the moral universe is long but it bends toward justice."-- Martin Luther King, Jr.

  • Grexit, the Sinking Fund Act of 1790, and the unraveling of the European project

    by John MacBeath Watkins

    A friend from New South Wales asks, if Europe can't resolve the debt crisis on its periphery by means of the sort of fiscal union that would have a central authority bail out banks, why can the U.S. do so?

    I've been following the Grexit controversy (potential Greek exit from the Euro zone) with interest, since it has the potential to disrupt one of the great internationalist projects of the last century, the European Union. I think I have the answer to my friend's question.

    First, Americans identified with each other culturally much more than Europeans do. Second, we've had real fiscal union since 1790, thanks to the genius of Alexander Hamilton.

    After the Revolutionary War, the original 13 colonies had quite a lot of debt, much of it owed to foreign banks and investors (primarily in the Netherlands.) Many were in a poor position to pay back the loans, and there was talk of default.

    Hamilton pushed through the Sinking Fund Act of 1790, which was somewhat misnamed for political reasons. It didn't really pay down the debt so much as fund it, so it could be turned over periodically and become the basis for a market in securities that would help provide the financing to develop industry in the new nation.

    But equally important was its political role. Hamilton saw that if the federal government took over the war debts and financed them through taxes, the states would be dependent on the federal government and the federal taxing authority to pay off their debts. This cemented the nation into one political and financial unit.

    Not that this happened without difficulties or entirely peacefully. George Washington led a militia to put down the Whiskey Rebellion (1791-1794,) an insurrection against federal taxes on corn whiskey. This happened while George Washington was president, and he became the only sitting president to lead troops in the field while suppressing it.

    Jared Bernstein writes that a German economist asked him, "How do you think the people of Manhattan would like bailing out Texas?" And Paul Krugman points out that it did, big time, during the Savings and Loan crisis.

    As it happens, I was there, as the business reporter for the Odessa American, a daily in West Texas. Bankers were getting convicted of crimes and sentenced to brief incarceration at hard summer camp in low-security prisons, the Resolution Trust Corporation was shutting down S&Ls and the federal government was guaranteeing the deposits, and we never heard a peep out of those parts of the country that contributed money to resolve the situation.

    Krugman points out that the resolution of this crisis cost about $125 million "back when that was real money," and about $75 million went to Texas. It didn't go in the form of loans, it went in the form of outright transfers from areas like Manhattan that weren't having a banking crisis.

    If the powers that be in Europe wanted a United States of Europe, they would act as Hamilton and Washington did to make sure the debts of the weaker states got paid off by a central authority. But they didn't, and they can't, because Europe is not about to become a United States of Europe. German voters won't stand for bailing out Greece, there is no central taxing authority and is not likely to be one, and a central European authority invading an area that rebelled against a centralized taxing authority is unthinkable.

    All of which is why the Euro was a bad idea to start with. There are those in Europe who think that forcing Greece to exit the Euro will make the rest of the Euro area stronger, but actually, it demonstrates why the Euro can't work, and why the project to make a United States of Europe is a doomed enterprise.

    America works as a currency area, in part, because large and ongoing transfers of wealth happen between productive states like Massachusetts and New York on the one hand, and low productivity states like Mississippi and Arkansas on the other.

    Those wealth transfers go on year after year, in the form of welfare spending, federal unemployment insurance, social security, disability benefits, and other programs. Most of this is so invisible to recipients that they vote for people who want to cut the federal budget.

    It's taken a long time for us to evolve our financial system, and there have been some pretty rough patches along the way. Andrew Jackson, one of our worst presidents, refused to renew the charter for the Bank of the United States, leaving the country without a central bank from 1836 to 1913. Between the end of bank's charter and the beginning of the Civil War, state banks were issuing currency, and how much it was worth depended, among other things, on how close you were to the issuing bank. Repeated financial crises between the 1870s and 1913 convinced the powers that be that we needed a central bank. We didn't get centralized deposit insurance until the bank failures of the 1930s demonstrated how badly that was needed.

    But at least we had the basic ingredients for a proper currency union, even when we didn't have a workable currency system thanks to Old Hickory. And the basic principle that we were a nation was settled between 1790 and 1794, with the Sinking Fund Act and the suppression of the Whiskey Rebellion.

    Europe is currently demonstrating that they do not have the unity the Sinking Fund Act of 1790 represented. Any attempt to set up such a mechanism would probably produce the European equivalent of the Whiskey Rebellion, and there is zero chance that Europe would put up with the military suppression of such a reaction.

    Try to imagine German troops marching into Belgium to suppress a tax revolt. It would bedj vu, and not in a goodway. I feel confident that the German people would stand with the Belgians against such an action..

    Perhaps there was a gentler path to a fiscal union, one in which the burden was shared without a central authority. For example, the banks that owned most of the Greek debt were Greek, German, French, and Italian. Each country could have bailed out its own banks. Instead, the troika (the European Central Bank, European Commission, and the International Monetary Fund) chose to paper over the issue, pretending that Greece suffered not from insolvency but from a liquidity problem. Some private lenders took a bit of a haircut, then the private debt got converted into ECB and IMF debt. In the end, Greece is on the hook to pay back all the debt, rather than having defaulted, as logic said they should, and having each country bail out its own banks.

    We know that Angela Merkel has been saying privately since at least 2011 that the Greek debt was unsustainable, that they would, in the end, default. And yet the policy of the German government was and still is that Greece must pay back every penny with interest. This means that the German government has been pursuing a policy that they knew wouldn't work, so there must be some sort of hidden agenda served by this hypocrisy.

    That agenda could be as simple as an unwillingness to face German voters with inconvenient and unpopular truths. The longer Merkel continues to fail to tell the German people the truth, that the Greek crisis will not be resolved by making them pay back every penny, the harder it becomes for her to tell them.

    Or it could be that there is some other goal.Yanis Varoufakis, who until recently was the Greek finance minister in charge of negotiating a resolution to the crisis, recently wrote an op-ed piece in The Guardian claiming that Germany wants to scare the bejesus out of France.

    "Based on months of negotiation, my conviction is that the German finance minister wants Greece to be pushed out of the single currency to put the fear of God into the French and have them accept his model of a disciplinarian eurozone," he wrote.

    No doubt there is more than one reason for the policy of the German and other governments on the Greek debt crisis. Whatever the reasons are, they seem impervious to evidence. Had the initial bailout worked as the troika said it would, the crisis would be over. Here's a chart from Paul Krugman's blog showing the difference between the IMF's economic projections for Greece and what actually happened:

    It's pretty obvious that if the Greek economy were the size the IMF said it would be at this point, they would have far less trouble paying back the debt. But after five years of failure, the troika offers nothing but more of the same policies.

    These policies have resulted in the Greek economy shrinking more quickly than the debt is paid back. More of the same can be expected to have more of the same result, which means that the Greek ability to pay back the debt is undermined to the extent that the whole exercise is futile. It also means that since the denominator in the debt/GDP ratio is sinking, a Greek government that started with a debt of 100% of GDP now has a debt of about 170% of GDP, despite paying back billions of dollars.

    It's not like the Germans should be unfamiliar with how this works. Debt forgiveness and the Marshall Plan following World War II rebuilt the German economy.

    This is covered in a paper byLondon School of Economics Professor of Economic History Albrecht Ritschl

    http://www.lse.ac.uk/researchAndExpertise/researchImpact/PDFs/germany-hypocrisy-eurozone-debt-crisis.pdf"In a telling comparison Ritschl showed that the debts racked up by the struggling Eurozone economies - Portugal, Italy, Ireland, Greece and Spain - were equal in size to Germany's current gross domestic product. In other words, debt cancellation for the Eurozone would be equivalent to the debts that were cancelled by the Allies after World War II. "In addition, the Marshall Plan injected $17 billion -- equivalent to roughly $160 billion in today's money -- to rebuild the country we had spend so much money reducing to rubble.

    The debt cancellation, by the way, was supposed to be temporary -- only until Germany was unified. But Germany was unified in 1990, and Germany has still not been required to repay the debt.

    Having itself relied upon the kindness of foreigners, Germany seems disinclined to pay it forward, and make no mistake, Germany is the driving force in negotiation over the Greek debt.

    I can only think that Germany is disenchanted with the European project, and has no wish for a stronger union. It seems they wish to make Greece an example, but what will Greece be an example of?

    I think they will be an example of the fact that Europe, despite all the years of the European Union, does not wish to be a true union. Grexit is the beginning of a great unraveling of the dreams of the European elites.


  • A 21' catboat for public sail

    by John MacBeath Watkins

    I propose a plywood catboat for public sail, and I think it would be easy enough to sail for CWB to use in our sailing instruction program and even the sailboat livery.

    The boat would be laid out like a Woods Hole boat, with a large cockpit surrounded by a tall coaming only inches inside the deck.

    It would have a deep, narrow centerboard, more efficient than the old fashioned pie-slice shaped boards. It would have a short, steep skeg instead of the traditional long skeg so that it would be more maneuverable than most catboats.

    The boat would be about 21 feet long and about ten feet wide. It would have plenty of initial stability, which should enable it to get a good rating for carrying capacity from the Coast Guard.

    It would carry the traditional catboat rig, with a low center of effort. I figure it should be fine with about 300 square feet of sail and about 500 lb. of ballast so the boat doesn't get squirrely when sailed light.

    The plan is to build it in stitch and glue with 3/8 inch plywood, glassed for abrasion protection. The boat will probably weigh about 1,000 lb. without the ballast, and it's designed for a displacement of 2,900 lb., so with the weight of the boat and the ballast at 1.500 lb., that leaves about 1,400 lb. for payload. That's about eight people, or one crew and seven passengers.

    The panels develop very well, and all are well under 24 ft. long and less than 4 ft. wide, which fits well with the dimensions of the plywood. There's actually less stress in the panel with the catboat bow than in the bilge panel.


    I believe such a boat would offer low first cost, low maintenance costs, usefulness in at least three of the Center's programs, and deliver a good experience to those who sail it.

    Dimensions are: 21' 10 inches, by 10 ft., draft of the hull about 10 inches, draft of the skeg and rudder 1' 6", displacement 2,900 lb.

  • Design exercize: Peaches, an 11 foot catboat

    by John MacBeath Watkins


    The boat is stitch and glue, with two panels a side, and I've managed to get the panels to develop with fairly low stress. In fact, there's less stress in the panel that forms the bottom and the catboat bow than there is in the side panels. Still, you'd best build with 4 mm okume plywood, which is light, fairly flexible, and comes from sustainable plantations. One problem is that the boat is too wide to fit into my 1997 Nissan's bed, so I'd have to cartop it. All-up weight is going to be around 100 lb., and you only have to lift one end at a time, so that shouldn't be too bad. Cost of construction with the sail should be less than $1,000.

    Now, I just need free time (I work six days a week), a space to build it, and a bit of cash to make the thing...well, they say man's reach should exceed his grasp, else what's a metaphor?

    Update: On the advice of Tom Price, I've raised the freeboard, and I think that makes the boat better:



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