Sunday, June 01, 2014

Ancillary Detection

I read this year's Nebula Award winner for best novel: "Ancillary Justice", by Ann Leckie. It is a very good 1st novel, but I'm not sure it was the best of 2013. It is a space opera, with a human-based galactic empire. The 1st 2/3 of the book has 2 narrative threads, 1 in the present, and 1 doing backstory from 20 years before. The backstory thread then completes and we just finish out the present. There has been some discussion online of the oddly gendered characters in the book -- they mostly seem to be women, but there are "him" and "her" among them. It didn't seem to really affect the story much. It did make me think of "The Left Hand of Darkness", by Ursula K. LeGuin, from decades ago.

Everyone in the book was religious, with the empire's state religion being very open about enfolding other religions it encountered. I guess if you're doing a non-Culture space empire (non-utopian, non-socialist, non-anarchist), then your empire probably would embrace a state religion as a tool of control. Altho I did wonder if this was a side effect of the female empire -- women have always seemed to me on the average to be more ready to embrace religion than men.

The ending of the book is somewhat ambiguous, but we are clearly going to have at least a trilogy here. The blurbs for the next one suggest what may be an uninteresting direction. So I'll give it a try and keep my fingers crossed.

I reviewed this blog for "science fiction" for 2013. Nothing jumped out as being superior to this novel. Hannu's 2nd came out in 2012. The 2nd book of James S.A. Corey's Expanse series was nominated, but seems to me that giving awards to subsequent volumes in a series is bogus somehow.

The future I want to live in is, of course, Iain M. Banks's The Culture. He died this year of cancer, age 59, on June 9th. A new Culture novel was always a cause for rejoicing. I guess I will have to, every year or 2, go back and reread 1 of the 9 that exist.

When I finished "Ancillary Justice", I just had my iPad, which doesn't have my Kobo password memorized, so I could not buy the Piketty -- giving me an excuse to read another novel! So I read "The Manual of Detection", by Jebediah Berry. This is a retro urban fantasy, very Kafkaesque. The line between reality and dreaming is severely blurred. It reminded me some of John Crowley's early novels, where reality is blurred with fiction. It also reminded me strongly of the movie "Dark City", with the perpetual rain, and the citizens of the city being manipulated as they sleep.

This was also a 1st novel, and seemed to me a lot fresher and newer than "Ancillary Justice". It was also nice that it did not seem to be setting itself up for a sequel. To me it is one of those novels that paints a unique picture and is complete in itself.

OK, enough stalling, on to the Piketty!

Saturday, May 17, 2014

Music Out, Music In

The jam situation is somewhat unsettled now.

The Wednesday night "Here For The Party" jam is gone from Lynagh's. New ownership cut their music from Wednesday thru Sunday to Friday and Saturday only. The story is they want to be more of a restaurant. Good luck with that. Lynagh's is a pub, with a bunch of regulars and a college crowd.

There is a new outdoor jam hosted by Matt Noell Sunday nights at Shamrock Bar and Grille on Patchen Drive. That has had decent musicians and crowds, but that patio seems kind of small.

There is a also new Wednesday night jam hosted by Albert Crabtree at City Barbeque on Richmond Road. That one is also supposed to be outdoors. I went this past Wednesday, apparently it is not starting until this Wednesday.

Finally, Lindsay Olive is hosting a jam back at Cheapside downtown following Thursday Night Live, from 9:30 to 12:30. He said there was a lot of traffic last week. I don't know if I'm going to try to make that one.

Man, I haven't done Music In since last December??? I just don't seem to get the time to listen to the new stuff I get. I sometimes think I should quit and just assimilate what I have already better, but, can't bring myself to do it. I'd miss too much cool music.

  • "NEW", Paul McCartney. This is a very strong effort. The songs are at least Wings quality, but not Beatles quality. Some of the love songs are a little creepy -- a 70 YO guy talking suggestively -- everyone knows you need to quit that shit mid-60's at the latest ;-> 4 stars.
  • "Wildewoman", Lucius. I really like this group. The 2 female singers are great, the band's sound is unique. I still am not hearing any male backup vocals like there are in some of their videos ?!?!? 4 stars.
  • "Pure Heroine", Lorde. I had this recommended to me a couple of times. It's OK, I guess. I guess people like that she's so young, but to me neither the voice or the songs are as interesting as, say, Adele. 3 stars.
  • "Give The People What They Want", Sharon Jones & The Dap-Kings. Plenty of authentic funk going on here, but I don't think the songs are as strong as on their prior album. 3 stars.
  • "Grace", Jeff Buckley (1994). Apparently after a studio career he recorded this 1 album before drowning. It is well known for his version of Leonard Cohen's "Hallelujah", and "Grace", which does indeed kind of make your hair stand up. 3 stars, 4 for "Grace".
  • "Trouble", Hospitality. I like this Brooklyn band, but I don't think this album is as strong as their prior one. 3 stars.
  • "Morning Phase", Beck. Wow, is this a listenable album! I don't think "mellow" is the right word, I think "serene" is. 4 stars.
  • Eponymous, St. Vincent. I really love Annie Clark's work. Such a juxtaposition of sweet vocals and nasty guitar work. 4 stars.
  • "Bad Self Portraits", Lake Street Dive. I really like this Boston band. I put the genre as R&B. The lead singer is really expressive without all the damn oversinging that is so prevalent now, the harmony singing is great. Here's a video of the title song. This could be Bonnie Raitt, southern rock -- or Sharon Jones & The Dap-Kings! 4 stars.
  • "Foreverly", Billie Joe + Norah. So this is Billie Joe Armstrong of Green Day and Norah Jones covering the Everly Brothers 1958 album "Songs Our Daddy Taught Us". I think I would have far preferred covers of Everly Brothers hits rather than these old traditionals. 3 stars.
  • "Ya Nass", Yasmine Hamdan. This Lebanese female singer is very easy to listen to. The backing instrumentals are mostly classical guitar. It is definitely decent mood music despite the guttural "ch"'s of Arabic. 3 stars.
That brings us up through March. I'll give the 4 albums since then in the "_Unrated" playlist more time to be digested.

Thursday, May 15, 2014

The Wealth of Nations, Book 5

Yay! I finished the 5th and final book of "The Wealth of Nations" a couple of weeks ago. What a slog! In addition to several dozen obsolete or archaic economic terms, around 1/3 of which were unknown to the iBook reader's dictionary, there were half page sentences with 30 commas, and a 4 page paragraph. Very hard to read.

I am just now getting around to blogging this because since the death of my 93 YO mother-in-law on March 16, 2014, I have been spending an afternoon-night-day in Louisville baby-sitting my 55 YO Downs Syndrome brother-in-law Bruce. It is easy but mind-numbing duty. 2 TVs playing MeTV -- awful 60's and 70's shows -- from 8am til 9pm. I could give you the hour-by-hour lineup, but I'll spare you. "Perry Mason" stands out for being fairly enjoyable, "Dragnet" is truly execrable. I am able to keep up on twitter/RSS/facebook and even do some reading. But no time to blog.

Additionally, last weekend we took a 4 day trip to Raleigh NC to go to Grandparent's Day at my granddaughter's school. We also went to the park and to the very nice Museum of Life and Science in Durham, and baby-sat Saturday evening while my son and daughter-in-law went out to the school gala. A very pleasant time. Here is a video of an art project at the school which features Lucy 3 times (rock star)! She is shown at 1:10, 1:15, and 1:35.

Book 5 of "The Wealth of Nations" is titled "Of The Revenue Of The Sovereign Or Commonwealth". The 1st chapter is titled "Of the Expenses of the Sovereign or Commonwealth". There are 4 of these:

  1. Defense
  2. Justice
  3. Public Works and Institutions
  4. Supporting the Dignity of the Sovereign (???)
For defense, we start with history-fu on the ability of different civilization types -- hunting, herding, farming, and industrial -- to be called to war. The progression is from everyone fights to militias to standing armies.
The fall of the Greek republics, and of the Persian empire was the effect of the irresistible superiority which a standing arm has over every other sort of militia. It is the first great revolution in the affairs of mankind of which history has preserved any distinct and circumstantial account.
On the expense of justice, Smith is pretty damn blunt, with some nice bashing of the poor:
But avarice and ambition in the rich, in the poor the hatred of labour and the love of present ease and enjoyment, are the passions which prompt to invade property; passions much more steady in their operation, and much more universal in their influence. Wherever there is a great property, there is great inequality. For one very rich man, there must be at least five hundred poor, and the affluence of the few supposes the indigence of the many. The affluence of the rich excites the indignation of the poor, who are often both driven by want, and prompted by envy to invade his possessions.
...
Civil government, so far as it is instituted for the security of property, is, in reality, instituted for the defence of the rich against the poor, or of those who have some property against those who have none at all.
So the justice system is designed to protect the rich from the poor. Sound familiar?

Then a truly classist explanation of why some people are superior to others:

The causes or circumstances which naturally introduce subordination, or which naturally and antecedent to any civil institution, give some men some superiority over the greater part of their brethren, seem to be four in number.
  1. "the superiority of personal qualifications, of strength, beauty, and agility of body; of wisdom and virtue; of prudence, justice, fortitude, and moderation of mind."
  2. "the superiority of age" -- respect your elders. Man, one thing about the tech world, there ain't a lot of that going around.
  3. "the superiority of fortune". Money talks, etc. He again discusses how before there was manufacturing to make neat stuff, the only thing a ruler could do with excess harvests was to feed more and more supporters. But, once they could buy neat stuff instead, that was given up.
  4. "the superiority of birth". If your grandpa was my grandpa's servant, why, it's natural that you should be my servant! Ah, the British mindset. It's too bad that they still keep the royal reality show running. I think that it helps keep remnants of this mindset in place. Even Americans seem to somehow like this type of classism -- look at the popularity of "Downton Abbey".
So much of this sounds so familiar. Why does the 10% support the 1% and the 1% support the .01%?
The rich, in particular, are necessarily interested to support that order of things, which can alone secure them in the possession of their own advantages. Men of inferior wealth combine to defend those of superior wealth in the possession of their property, in order that men of superior wealth may combine to defend them in the possession of theirs.
One thing that was interesting is that the justice system used to be a for-profit institution. You paid the judge for hearing your case. I guess eventually that didn't work out; rather, it lead to "gross abuses".
In those days, the administration of justice not only afforded a certain revenue to the sovereign, but, to procure this revenue, seems to have been one of the principal advantages which he proposed to obtain by the administration of justice.
Also justice started out with the king being the judge, before it became more convenient for them to outsource the function. Interesting too, Smith notes that this split lead to an early version of the separation of power between branches of government.
In order to make every individual feel himself perfectly secure in the possession of every right which belongs to him, it is not only necessary that the judicial should be separated from the executive power, but that it should be rendered as much as possible independent of that power.
The 1st type of public works discussed are those that promote commerce: primarily roads, bridges, waterways, and harbors. Smith was an equal opportunity basher of the rich as well as the poor.
When the toll upon carriages of luxury, upon coaches, postchaises, etc. is made somewhat higher in proportion to their weight, than upon carriages of necessary use, such as carts, waggons, etc. the indolence and vanity of the rich is made to contribute, in a very easy manner, to the relief of the poor, by rendering cheaper the transportation of heavy goods to all the different parts of the country.
Smith was a fan of local government more than national government. Maybe at the time there were not individuals or corporations rich enough to buy local government as seems to so often happen now.
The abuses which sometimes creep into the local and provincial administration of a local and provincial revenue, how enormous soever they may appear, are in reality, however, almost always very trifling in comparison of those which commonly take place in the administration and expenditure of the revenue of a great empire.
Smith really didn't seem to trust much of anybody. Here he is on corporate influence on regulation -- corporations love regulation when they can get it to stack the deck in their favor.
The usual corporation spirit, wherever the law does not restrain it, prevails in all regulated companies. When they have been allowed to act according to their natural genius, they have always, in order to confine the competition to as small a number of persons as possible, endeavoured to subject the trade to many burdensome regulations.
Is this next statement the precursor of Say's Law? Say was a French economist who lived from 1767 to 1832.
The increase of demand, besides, though in the beginning it may sometimes raise the price of goods, never fails to lower it in the long-run. It encourages production, and thereby increases the competition of the producers, who, in order to undersell one another, have recourse to new divisions or labour and new improvements of art, which might never otherwise have been thought of.
This is interesting: in Smith's time, for all his love of markets, he felt most corporations could not succeed without a monopoly, with the only exceptions being banking, insurance, and utilities.
The only trades which it seems possible for a joint-stock company to carry on successfully, without an exclusive privilege, are those, of which all the operations are capable of being reduced to what is called a routine, or to such a uniformity of method as admits of little or no variation. Of this kind is, first, the banking trade; secondly, the trade of insurance from fire and from sea risk, and capture in time of war; thirdly, the trade of making and maintaining a navigable cut or canal; and, fourthly, the similar trade of bringing water for the supply of a great city.
The 2nd type of public works discussed are educational institutions. Universal education for youths is assumed. Higher education was initially targeted solely at the production of clerics. It gradually included secular subject and generated the currently existing universities.

Smith advocates against tenure for teachers -- which given that he was a university professor of moral philosophy seems odd. But he really seemed to believe that everyone, in their heart of hearts, is a slacker, who will goof off if not forced to perform.

In the university of Oxford, the greater part of the public professors have, for these many years, given up altogether even the pretence of teaching.
...
A private teacher could never find his account in teaching either an exploded and antiquated system of a science acknowledged to be useful, or a science universally believed to be a mere useless and pedantic heap of sophistry and nonsense. Such systems, such sciences, can subsist nowhere but in those incorporated societies for education, whose prosperity and revenue are in a great measure independent of their industry.
On education for people of all ages:
The institutions for the instruction of people of all ages, are chiefly those for religious instruction. This is a species of instruction, of which the object is not so much to render the people good citizens in this world, as to prepare them for another and a better world in the life to come.
Wow, what a waste, I'm glad we've mostly moved beyond that.

Smith discusses conservative versus liberal moral systems:

In every civilized society, in every society where the distinction of ranks has once been completely established, there have been always two different schemes or systems of morality current at the same time; of which the one may be called the strict or austere; the other the liberal, or, if you will, the loose system. The former is generally admired and revered by the common people; the latter is commonly more esteemed and adopted by what are called the people of fashion. The degree of disapprobation with which we ought to mark the vices of levity, the vices which are apt to arise from great prosperity, and from the excess of gaiety and good humour, seems to constitute the principal distinction between those two opposite schemes or systems. In the liberal or loose system, luxury, wanton, and even disorderly mirth, the pursuit of pleasure to some degree of intemperance, the breach of chastity, at least in one of the two sexes, etc. provided they are not accompanied with gross indecency, and do not lead to falsehood and injustice, are generally treated with a good deal of indulgence, and are easily either excused or pardoned altogether. In the austere system, on the contrary, those excesses are regarded with the utmost abhorrence and detestation. The vices of levity are always ruinous to the common people, and a single week’s thoughtlessness and dissipation is often sufficient to undo a poor workman for ever, and to drive him, through despair, upon committing the most enormous crimes. The wiser and better sort of the common people, therefore, have always the utmost abhorrence and detestation of such excesses, which their experience tells them are so immediately fatal to people of their condition.
Hah! So the rich get to laugh and joke and have fun, while the lower classes know that they'd better keep their noses clean and approach life with humorless solemnity! Kind of reminds you of southern christians. He then goes on about how all the little sects all find each other to be heretics and are constantly contending with one another. He lists 2 remedies to this problem:
  1. "the study of science and philosophy" ... "Science is the great andidote to the poison of enthusiasm and superstition". We would today probably use the word "zealotry" instead of "enthusiasm".
  2. "the frequency and gaiety of public diversions" I'm pretty sure we've got 18th century beat on that one.
A little bit of nice Catholic Church bashing. It's pleasant to see some Enlightenment thinking.
In the state in which things were, through the greater part of Europe, during the tenth, eleventh, twelfth, and thirteenth centuries, and for some time both before and after that period, the constitution of the church of Rome may be considered as the most formidable combination that ever was formed against the authority and security of civil government, as well as against the liberty, reason, and happiness of mankind, which can flourish only where civil government is able to protect them.
Smith cites the "good stuff" argument that decreased the power of the landed gentry as also decreasing the power of the Church (note the run-on sentence with 13 commas):
The gradual improvements of arts, manufactures, and commerce, the same causes which destroyed the power of the great barons, destroyed, in the same manner, through the greater part of Europe, the whole temporal manufactures, and commerce, the clergy, like the great barons, found something for which they could exchange their rude produce, and thereby discovered the means of spending their whole revenues upon their own persons, without giving any considerable share of them to other people.
Chapter 2 is titled "Of the Sources of the General or Public Revenue of the Society". So we now get the same excruciating detail that we got on 18th century import/export duties and tariffs on 18th century taxation schemes. There is more of the weirdness of insisting that gold, silver, land, and agricultural produce are the only form of capital that can be trusted. I wonder what he would think of modern derivative financial instruments?
The unstable and perishable nature of stock and credit, however, renders them unfit to be trusted to as the principal funds of that sure, steady, and permanent revenue, which can alone give security and dignity to government. The government of no great nation, that was advanced beyond the shepherd state, seems ever to have derived the greater part of its public revenue from such sources.
Man, they had a bunch of taxes back then:
  • taxes on rent of land;
  • taxes on the produce of the land;
  • taxes on the rent of houses;
  • taxes on profit (from stock);
  • taxes on profit from certain industries;
  • taxes on the capital value of lands, houses, and stock (property tax);
  • taxes on wages;
  • capitation taxes (based on current net worth);
  • taxes on consumable commodities -- in 18th century Great Britain, these were particularly on salt, leather, soap and candles! Salt taxes date back to the Romans.
  • taxes on luxuries, in particular sugar, alcohol, and tobacco. Given our obesity epidemic, we should really start taxing sugar like crazy.
Some countries had progressive taxes -- but some had regressive taxes:
In Silesia, lands held by a noble tenure are taxed three per cent. higher than those held by a base tenure. The honours and privileges of different kinds annexed to the former, his Prussian majesty had probably imagined, would sufficiently compensate to the proprietor a small aggravation of the tax; while, at the same time, the humiliating inferiority of the latter would be in some measure alleviated, by being taxed somewhat more lightly. In other countries, the system of taxation, instead of alleviating, aggravates this inequality. In the dominions of the king of Sardinia, and in those provinces of France which are subject to what is called the real or predial taille, the tax falls altogether upon the lands held by a base tenure. Those held by a noble one are exempted.
Here Smith almost sounds like a damn socialist!
A tax upon house-rents, therefore, would in general fall heaviest upon the rich; and in this sort of inequality there would not, perhaps, be any thing very unreasonable It is not very unreasonable that the rich should contribute to the public expense, not only in proportion to their revenue, but something more than in that proportion.
They also taxed churches in places. Sure would be nice to see that done here.
In the dominions of the king of Prussia, the revenue of the church is taxed much higher than that of lay proprietors. The revenue of the church is, the greater part of it, a burden upon the rent of land.
I found this passage somewhat eerie, with Smith anticipating our modern stateless plutocrats, patriots all:
The proprietor of stock is properly a citizen of the world, and is not necessarily attached to any particular country. He would be apt to abandon the country in which he was exposed to a vexatious inquisition, in order to be assessed to a burdensome tax; and would remove his stock to some other country, where he could either carry on his business, or enjoy his fortune more at his ease.
Here's an example of the mind-numbing incomprehensibility found in this book:
In France, the greater part of the actual revenue of the crown is derived from eight different sources; the taille, the capitation, the two vingtiemes, the gabelles, the aides, the traites, the domaine, and the farm of tobacco.
The 3rd and final (!) chapter of this book is titled "Of Public Debts". Smith was in favor of government borrowing only during times of war.
It is only during the continuance of war, however, that the system of funding has this advantage over the other system.
I wonder if Keynes could have won him over? Deficit spending was popular throughout Europe at the time.
The progress of the enormous debts which at present oppress, and will in the long-run probably ruin, all the great nations of Europe, has been pretty uniform.
...
When national debts have once been accumulated to a certain degree, there is scarce, I believe, a single instance of their having been fairly and completely paid. The liberation of the public revenue, if it has ever been brought about at all, has always been brought about by a bankruptcy; sometimes by an avowed one, though frequently by a pretended payment.
Pretended payments were typically done by devaluing currency, just as the best way to get rid of debt now is to inflate your currency until the debt reaches a manageable level. Smith was also interested in flattening taxes, but was a little wary that that would work.
A more equal land tax, a more equal tax upon the rent of houses, and such alterations in the present system of customs and excise as those which have been mentioned in the foregoing chapter, might, perhaps, without increasing the burden of the greater part of the people, but only distributing the weight of it more equally upon the whole, produce a considerable augmentation of revenue.
I thought that this was an interesting example of being a prisoner of one's own echo chamber: Smith's obsession with gold and silver currency persists, even as he talks about the American colonies doing just fine without it.
It is not, therefore, the poverty of the colonies which occasions, in the greater part of them, the present scarcity of gold and silver money. Their great demand for active and productive stock makes it convenient for them to have as little dead stock as possible, and disposes them, upon that account, to content themselves with a cheaper, though less commodious instrument of commerce, than gold and silver.
Phew, that does it. In summary, I think that it was worth reading this book, which is still referenced extensively. Just yesterday, David Brin, in a blog post about Piketty's "Capital in the 21st Century" was wishing for "smithian libertarianism" in markets to replace the rigged system we have now. I wonder if anyone has ever produced an edited version of "Wealth of Nations" with all the 18th century facts and figured? It would make a much more palatable read. But, seeing what has changed, and what surprisingly has not, I think makes this a good book with which to start my study of the "science" of Economics.

I was going to read Keynes "General Theory" next, but I think I'll go on and read the Piketty before that. But first, wow, May 15 and I haven't even started on the magazine stack that should have been done by May 1. For being retired, I sure seem to be busy! ;->

Thursday, April 24, 2014

Cybernetic Singularity Page Turners

I burned through "Nexus" and "Crux" by Ramez Naam (@ramez) in 3 days. Naam is a technologist formerly with Microsoft and Apex Nanotechnologies. He also wrote a non-fiction book "More Than Human: Embracing the promise of biological enhancement", which I probably won't read.

Set 30 or so years in the future, hackers learn to program the nanotech-based recreational drug Nexus. So you've got programmable wetware with apps available; group minds; and an uploaded mind -- your basic singularity-fu, all nicely explored. The main conflict is the hackers trying to move to a post-human world while the world's governments, particularly the US, try to stop them. There are civil rights overtones as post-humans are declared non-human and deprived of their rights. Lots of action, lots of explosions, Game of Thrones level body counts. It's got great geek detail -- stack dumps when their wetware crashes, details of how something goes viral on the Internet despite government efforts to stop it.

Some of the plot outcomes were somewhat predictable, but, so what? I got to give myself attaboys for predictive powers. Both novels reach a satisfying conclusion, with a reasonable number of plot threads tied up, but the 2nd novel takes up right where the 1st leaves off, and there is clearly room for several more sequels. I am looking forward to reading these, I think the material is strong enough that he can keep it interesting and exciting for several more books.

HuffPo Suckage

Quite the blathering evening.

So I go to comment on a Huffington Post article on transhumanist life extension. Apparently they are going to the Facebook model of trying to verify the actual identity of posters, presumably to get rid of anonymous trolls -- an effort which, all in all, I must say that I support.

But #EpicFail in the execution. Would not accept my Twitter ID (1st choice) nor my Google ID (2nd choice). Finally accepted my Facebook ID, which is not what I would chosen at all for a post like this. Facebook I mostly use for contact with my musician friends and to get pictures of my relatives. So the post is finally accepted, I get a message:

Due to the potentially sensitive nature of the material, this post will not be made public immediately.
??? Sensitive nature of the material ??? Which word is on the NSA watchlist, "socialist", "anarchist", or "utopia"???

Here is the comment:

I used to think that multi-100 year life spans would be a great idea. Then you realize, the .01% will get the tech 1st and freeze the rest of us out. Read Richard K. Morgan "Altered Carbon". The bad guy is like John Huston in "Chinatown" but 400 YO instead of 80 -- ultra-rich, ultra-powerful, and completely amoral. All that extended life spans will do is further cement the hereditary rich in their position with their boots on our throats :-( Unless of course we can reverse the politics of the last 30 years and implement a post-scarcity, socialist, anarchist utopia :-)
Hopefully they'll get this to be a little less obnoxious RSN.

A Poem

Walking along a foot path
Running next to Beargrass Creek
Below the Louisville Zoo.
The trees are all adorned
With hundreds of plastic grocery bags.
It made me very sad.
Once those things get into the environment
They are there forever.
There were many signs:
The water is toxic.
No fishing, no boating, no swimming, no wading.
How would you try to clean them up?

Sunday, April 13, 2014

The Wealth of Nations, Book 4

Before we get into Book 4 of "Wealth", a correction. My online course stated that "The Wealth of Nations" was published in 1776, not 1790 as I stated. The Wikipedia article on Adam Smith concurs with the 1776 date. But it looks like he continued to revise the book up until his death in 1790. There are references to a 1780 trade agreement, and to the American Revolution having already taken place ("Before the revolt of our North American colonies").

1776 was a banner year:

  1. The signing of the Declaration of Independence started the American Revolution.
  2. The invention of the steam engine by James Watt started the Industrial Revolution.
  3. "Wealth of Nations" was published, which is generally considered to mark the start of modern economics.

Book 4 is titled "Of Systems Of Political Economy". It is the longest book. It basically discusses trade between nations and the government's involvement in such trade via duties, tariffs, and bounties (basically inverse tariffs). He calls it The Mercantile System, but never really defines it. To me, his main points were:

  • Government attempting to protect or incubate industries by penalizing imports or exports via tariffs or outright bans winds up being a zero sum game. Favoring one industry segment penalizes other industry segments or consumers.
  • Balance of trade is really not worth worrying about.
  • Free trade, like free markets, will make everything work best in the end.
  • "Monopoly of one kind or another, indeed, seems to be the sole engine of the mercantile system."
There are more examples of how weird it makes things to have your currency based on precious metals. Because not only can the metal be used for coins, it can also be used for flatware!
The gold and silver which can properly be considered as accumulated, or stored up in any country, may be distinguished into three parts; first, the circulating money; secondly, the plate of private families; and, last of all, the money which may have been collected by many years parsimony, and laid up in the treasury of the prince.
In chapter 2, "Of Restraints Upon Importation From Foreign Countries Of Such Goods As Can Be Produced At Home", we meet the only actual reference in "Wealth" to the famous "invisible hand". It's import is actually somewhat limited, being used only to explain why merchants better promote the public interest by supporting domestic rather than foreign industry.
He generally, indeed, neither intends to promote the public interest, nor knows how much he is promoting it. By preferring the support of domestic to that of foreign industry, he intends only his own security; and by directing that industry in such a manner as its produce may be of the greatest value, he intends only his own gain; and he is in this, as in many other cases, led by an invisible hand to promote an end which was no part of his intention. Nor is it always the worse for the society that it was no part of it. By pursuing his own interest, he frequently promotes that of the society more effectually than when he really intends to promote it. I have never known much good done by those who affected to trade for the public good. It is an affectation, indeed, not very common among merchants, and very few words need be employed in dissuading them from it.
Here's a passage from chapter 5 which is more what people understand "the invisible hand" to mean:
The natural effort of every individual to better his own condition, when suffered to exert itself with freedom and security, is so powerful a principle, that it is alone, and without any assistance, not only capable of carrying on the society to wealth and prosperity, but of surmounting a hundred impertinent obstructions, with which the folly of human laws too often encumbers its operations: though the effect of those obstructions is always, more or less, either to encroach upon its freedom, or to diminish its security.
Here's an example of his favoring free trade:
If a foreign country can supply us with a commodity cheaper than we ourselves can make it, better buy it of them with some part of the produce of our own industry, employed in a way in which we have some advantage.
And another:
By diminishing the number of sellers, therefore, we necessarily diminish that of buyers, and are thus likely not only to buy foreign goods dearer, but to sell our own cheaper, than if there was a more perfect freedom of trade.
And another:
Every derangement of the natural distribution of stock is necessarily hurtful to the society in which it takes place;
And another:
The effect of bounties, like that of all the other expedients of the mercantile system, can only be to force the trade of a country into a channel much less advantageous than that in which it would naturally run of its own accord.
Interesting, also on bounties (government credit for producing certain goods) -- that they can lead to bubbles, similar to those we have seen in the last few decades. The housing bubble would have been less likely without the tax deduction on mortgages -- a government "bounty" paid to the consumer. I can't think of a similar incentive that led to the dot-com bubble of the late '90s.
The usual effect of such bounties is, to encourage rash undertakers to adventure in a business which they do not understand; and what they lose by their own negligence and ignorance, more than compensates all that they can gain by the utmost liberality of government.
He does make an exception for strategic materials required to maintain the nation's military equipment.

Smith is definitely not a fan of taxes. At the time of "Wealth", Holland was the richest country in the western world.

Such taxes, when they have grown up to a certain height, are a curse equal to the barrenness of the earth, and the inclemency of the heavens, and yet it is in the richest and most industrious countries that they have been most generally imposed. No other countries could support so great a disorder. As the strongest bodies only can live and enjoy health under an unwholesome regimen, so the nations only, that in every sort of industry have the greatest natural and acquired advantages, can subsist and prosper under such taxes. Holland is the country in Europe in which they abound most, and which, from peculiar circumstances, continues to prosper, not by means of them, as has been most absurdly supposed, but in spite of them.
Here's a surprisingly democratic result derived from Libertarian principles: that all people should be free to follow whatever trade they desire. I bet that he would not be opposed to anyone who felt they could be, say, a surgeon, putting a sign up and having at it -- buyer beware! Like when our own Random Paul created his own certifying board -- solid Libertarian principle in action.
Soldiers and seamen, indeed, when discharged from the king’s service, are at liberty to exercise any trade within any town or place of Great Britain or Ireland. Let the same natural liberty of exercising what species of industry they please, be restored to all his Majesty’s subjects, in the same manner as to soldiers and seamen; that is, break down the exclusive privileges of corporations, and repeal the statute of apprenticeship, both which are really encroachments upon natural Liberty, and add to those the repeal of the law of settlements, so that a poor workman, when thrown out of employment, either in one trade or in one place, may seek for it in another trade or in another place, without the fear either of a prosecution or of a removal; and neither the public nor the individuals will suffer much more from the occasional disbanding some particular classes of manufacturers, than from that of the soldiers.
It is interesting that the difficulties caused by currencies being based upon precious metals, such that coins can be clipped or become worn, led to the establishment of the first commercial bank, in Amsterdam in 1609.

Smith really does seem to be more Libertarian than what we would now call pro-business. He seems pretty disgusted by merchants and industries who succeed in getting favorable trade treatment from the government.

Commerce, which ought naturally to be, among nations as among individuals, a bond of union and friendship, has become the most fertile source of discord and animosity. The capricious ambition of kings and ministers has not, during the present and the preceding century, been more fatal to the repose of Europe, than the impertinent jealousy of merchants and manufacturers. The violence and injustice of the rulers of mankind is an ancient evil, for which, I am afraid, the nature of human affairs can scarce admit of a remedy: but the mean rapacity, the monopolizing spirit, of merchants and manufacturers, who neither are, nor ought to be, the rulers of mankind, though it cannot, perhaps, be corrected, may very easily be prevented from disturbing the tranquillity of anybody but themselves.
His attitude on having wealthy neighboring countries is interesting:
The wealth of neighbouring nations, however, though dangerous in war and politics, is certainly advantageous in trade. ... Private people, who want to make a fortune, never think of retiring to the remote and poor provinces of the country, but resort either to the capital, or to some of the great commercial towns. They know, that where little wealth circulates, there is little to be got; but that where a great deal is in motion, some share of it may fall to them. The same maxim which would in this manner direct the common sense of one, or ten, or twenty individuals, should regulate the judgment of one, or ten, or twenty millions, and should make a whole nation regard the riches of its neighbours, as a probable cause and occasion for itself to acquire riches.
Here is a succinct statement on his "don't worry about balance of trade" thinking. Nice too that he jibes at his fellow economists -- some things never change.
There is no commercial country in Europe, of which the approaching ruin has not frequently been foretold by the pretended doctors of this system, from all unfavourably balance of trade. After all the anxiety, however, which they have excited about this, after all the vain attempts of almost all trading nations to turn that balance in their own favour, and against their neighbours, it does not appear that any one nation in Europe has been, in any respect, impoverished by this cause. Every town and country, on the contrary, in proportion as they have opened their ports to all nations, instead of being ruined by this free trade, as the principles of the commercial system would lead us to expect, have been enriched by it.
But in contrast he is absolutely not a fan of deficit spending -- I guess we have to wait for Keynes to realize that borrowing money during slumps when it's cheap and paying it back during booms when revenues are up can work wonders.

Chapter 7 is titled "Of Colonies" and deals with all things colonial. Definitely relevant to an earlier time. It starts with a discussion of Greek and Roman colonies, about which I had totally forgotten. He appears to have been a fan of the American colonies.

The colony of a civilized nation which takes possession either of a waste country, or of one so thinly inhabited that the natives easily give place to the new settlers, advances more rapidly to wealth and greatness than any other human society.
One important difference in the colonies is that primogeniture is no longer universal. There is so much free land that this is not a problem. But Britain was practicing the standard colonial model, with the colonies restricted to exporting raw materials and importing manufactured products.
The more advanced or more refined manufactures, even of the colony produce, the merchants and manufacturers of Great Britain chuse to reserve to themselves, and have prevailed upon the legislature to prevent their establishment in the colonies, sometimes by high duties, and sometimes by absolute prohibitions.
And, you gotta give credit to Smith, he calls this out:
To prohibit a great people, however, from making all that they can of every part of their own produce, or from employing their stock and industry in the way that they judge most advantageous to themselves, is a manifest violation of the most sacred rights of mankind.
There is a discussion of the restrictive trade practices which the European countries adapted to maximize their profits on trade with the Americas and the Far East. And again, Smith is against all such practices.
But whatever raises, in any country, the ordinary rate of profit higher than it otherwise would be, necessarily subjects that country both to an absolute, and to a relative disadvantage in every branch of trade of which she has not the monopoly.
Surprisingly, globalization is already an issue in the late 18th century -- with business, just as now, not wanting to share the wealth.
Our merchants frequently complain of the high wages of British labour, as the cause of their manufactures being undersold in foreign markets; but they are silent about the high profits of stock. They complain of the extravagant gain of other people; but they say nothing of their own. The high profits of British stock, however, may contribute towards raising the price of British manufactures, in many cases, as much, and in some perhaps more, than the high wages of British labour.
More Smith goodness! Here he lauds full employment.
The most advantageous employment of any capital to the country to which it belongs, is that which maintains there the greatest quantity of productive labour, and increases the most the annual produce of the land and labour of that country.
There is some commentary on the American Revolution as seen from the British side. There was great consternation at the loss of their trade monopolies. But, following his Libertarian instincts, Smith actually proposed that Britain get rid of all its colonies, and the expense of protecting them, when the only ones benefitting from them are British merchants and manufacturers.
A great empire has been established for the sole purpose of raising up a nation of customers, who should be obliged to buy, from the shops of our different producers, all the goods with which these could supply them. For the sake of that little enhancement of price which this monopoly might afford our producers, the home consumers have been burdened with the whole expense of maintaining and defending that empire. For this purpose, and for this purpose only, in the two last wars, more than two hundred millions have been spent, and a new debt of more than a hundred and seventy millions has been contracted, over and above all that had been expended for the same purpose in former wars. The interest of this debt alone is not only greater than the whole extraordinary profit which, it never could be pretended, was made by the monopoly of the colony trade, but than the whole value of that trade, or than the whole value of the goods which, at an average, have been annually exported to the colonies. It cannot be very difficult to determine who have been the contrivers of this whole mercantile system; not the consumers, we may believe, whose interest has been entirely neglected; but the producers, whose interest has been so carefully attended to; and among this latter class, our merchants and manufacturers have been by far the principal architects. In the mercantile regulations which have been taken notice of in this chapter, the interest of our manufacturers has been most peculiarly attended to; and the interest, not so much of the consumers, as that of some other sets of producers, has been sacrificed to it.
And then maybe after the colonies are turned loose ...
By thus parting good friends, the natural affection of the colonies to the mother country, which, perhaps, our late dissensions have well nigh extinguished, would quickly revive. It might dispose them not only to respect, for whole centuries together, that treaty of commerce which they had concluded with us at parting, but to favour us in war as well as in trade, and instead of turbulent and factious subjects, to become our most faithful, affectionate, and generous allies; and the same sort of parental affection on the one side, and filial respect on the other, might revive between Great Britain and her colonies, which used to subsist between those of ancient Greece and the mother city from which they descended.
Ha ha, I guess that it didn't turn out that way for their American colonies. But Britain is the greatest ally of the US nonetheless. I see this more as the empire of the 19th century cozying up to the empire of the 20th century more than as "parental affection" and "filial respect".

I'm guessing Smith would have been aghast at the British Empire of the 19th century.

He also proposed that representatives from the colonies be given seats in the British parliament, in an attempt to buy off the leaders of the colonies.

Unless this or some other method is fallen upon, and there seems to be none more obvious than this, of preserving the importance and of gratifying the ambition of the leading men of America, it is not very probable that they will ever voluntarily submit to us ...
Smith is eerily prescient on the future of the American colonies. He really seems to have been a fan.
From shopkeepers, trades men, and attorneys, they are become statesmen and legislators, and are employed in contriving a new form of government for an extensive empire, which, they flatter themselves, will become, and which, indeed, seems very likely to become, one of the greatest and most formidable that ever was in the world.
Smith next goes into excruciating detail on many of the market goods of his time. I thought this one was kind of funny, about efforts of the English wool industry to get the government to give them special treatment.
This doctrine, like most other doctrines which are confidently asserted by any considerable number of people, was, and still continues to be, most implicitly believed by a much greater number: by almost all those who are either unacquainted with the woollen trade, or who have not made particular inquiries. It is, however, so perfectly false, that English wool is in any respect necessary for the making of fine cloth, that it is altogether unfit for it. Fine cloth is made altogether of Spanish wool. English wool, cannot be even so mixed with Spanish wool, as to enter into the composition without spoiling and degrading, in some degree, the fabric of the cloth.
Ha ha, his reference to "any considerable number of people" reminds me of Paul Krugman's Very Serious People (VSP).

Here is Smith recommending that if the game is zero-sum, then it shouldn't be played.

To hurt, in any degree, the interest of any one order of citizens, for no other purpose but to promote that of some other, is evidently contrary to that justice and equality of treatment which the sovereign owes to all the different orders of his subjects.
Another principle, which I guess can be regarded as Libertarian, is that when the government makes things too restrictive, the market will find a way around the government. Hello, war on drugs.
Their avidity, however, upon this, as well as upon many other occasions, disappointed itself of its object. This enormous duty presented such a temptation to smuggling, that great quantities of this commodity were clandestinely exported, probably to all the manufacturing countries of Europe;
Wow, there are just so many issues that are still with us today, in different form. Here's 18th century Intellectual Property (IP) law. And notice, the rights of the individual are completely subjugated to those of the merchant or manufacturer.
When such heavy penalties were imposed upon the exportation of the dead instruments of trade, it could not well be expected that the living instrument, the artificer, should be allowed to go free. Accordingly, by the 5th Geo. I. chap. 27, the person who shall be convicted of enticing any artificer, of or in any of the manufactures of Great Britain, to go into any foreign parts, in order to practise or teach his trade, is liable, for the first offence, to be fined in any sum not exceeding one hundred pounds, and to three months imprisonment, and until the fine shall be paid; and for the second offence, to be fined in any sum, at the discretion of the court, and to imprisonment for twelve months, and until the fine shall be paid. By the 23d Geo. II. chap. 13, this penalty is increased, for the first offence, to five hundred pounds for every artificer so enticed, and to twelve months imprisonment, and until the fine shall be paid; and for the second offence, to one thousand pounds, and to two years imprisonment, and until the fine shall be paid.
...
If any artificer has gone beyond the seas, and is exercising or teaching his trade in any foreign country, upon warning being given to him by any of his majesty’s ministers or consuls abroad, or by one of his majesty’s secretaries of state, for the time being, if he does not, within six months after such warning, return into this realm, and from henceforth abide and inhabit continually within the same, he is from thenceforth declared incapable of taking any legacy devised to him within this kingdom, or of being executor or administrator to any person, or of taking any lands within this kingdom, by descent, devise, or purchase. He likewise forfeits to the king all his lands, goods, and chattels; is declared an alien in every respect; and is put out of the king’s protection. It is unnecessary, I imagine, to observe how contrary such regulations are to the boasted liberty of the subject, of which we affect to be so very jealous; but which, in this case, is so plainly sacrificed to the futile interests of our merchants and manufacturers.
The final chapter of Book 4 is chapter 9, "Of The Agricultural Systems, Or Of Those Systems Of Political Economy Which Represent The Produce Of Land, As Either The Sole Or The Principal Source Of The Revenue And Wealth Of Every Country". Man, Smith is definitely the king of the run-on sentence. This goes back to the "agriculture is better than manufacturing" meme. He reviews a French theory, attributed to Colbert and Qttesnai, which places merchants, artificers and manufacturers into the "unproductive" class.
Artificers, manufacturers, and merchants, can augment the revenue and wealth of their society by parsimony only; or, as it is expressed in this system, by privation, that is, by depriving themselves of a part of the funds destined for their own subsistence. They annually reproduce nothing but those funds. Unless, therefore, they annually save some part of them, unless they annually deprive themselves of the enjoyment of some part of them, the revenue and wealth of their society can never be, in the smallest degree, augmented by means of their industry. Farmers and country labourers, on the contrary, may enjoy completely the whole funds destined for their own subsistence, and yet augment, at the same time, the revenue and wealth of their society.
I'm really not sure I get this. Smith goes back to the the open market being best.
Those systems, therefore, which preferring agriculture to all other employments, in order to promote it, impose restraints upon manufactures and foreign trade, act contrary to the very end which they propose, and indirectly discourage that very species of industry which they mean to promote.
...
It is thus that every system which endeavours, either, by extraordinary encouragements to draw towards a particular species of industry a greater share of the capital of the society than what would naturally go to it, or, by extraordinary restraints, to force from a particular species of industry some share of the capital which would otherwise be employed in it, is, in reality, subversive of the great purpose which it means to promote. It retards, instead of accelerating the progress of the society towards real wealth and greatness; and diminishes, instead of increasing, the real value of the annual produce of its land and labour.
So with regard to current US politics, Smith would advocate getting rid of all forms of corporate welfare.

Well, that's 4 books down, 1 to go. The last book is on the revenue of the state.


Thursday, April 03, 2014

Future Letter to the Editor

I'll wait til next week to post this one to the Herald Leader, but I'll save it here since I've got the Jefferson quote in the paste buffer.
What would the Founding Fathers think of our current plutocracy? Here's a quote from a letter written by Thomas Jefferson in 1814:

"we have no paupers, the old and crippled among us, who possess nothing and have no families to take care of them, being too few to merit notice as a separate section of society, or to affect a general estimate. The great mass of our population is of laborers; our rich, who can live without labor, either manual or professional, being few, and of moderate wealth. Most of the laboring class possess property, cultivate their own lands, have families, and from the demand for their labor are enabled to exact from the rich and the competent such prices as enable them to be fed abundantly, clothed above mere decency, to labor moderately and raise their families. They are not driven to the ultimate resources of dexterity and skill, because their wares will sell although not quite so nice as those of England. The wealthy, on the other hand, and those at their ease, know nothing of what the Europeans call luxury. They have only somewhat more of the comforts and decencies of life than those who furnish them. Can any condition of society be more desirable than this?"

I think Jefferson would view our current plutocracy, with its billionaires with multiple castles, airplanes, and yachts, with shock and horror.

Letter to the Editor

Looks like the last letter is not going to get published. Let's try again!
Hello Plutocracy, Goodbye Democracy

In all seriousness, who could possibly believe that the Founding Fathers intended "freedom of speech" to include unlimited election campaign contributions by the ultra-wealthy and corporations? Apparently 5 Supreme Court justices and our own senior Senator, Mitch McConnell, the champion fund-raiser in all of history, expect us to think that they could and do believe this.

Common sense tells us that their true motive can be nothing but to continue the consolidation of power in this country into the hands of the ultra-wealthy and the corporations. Even if all of us can learn to ignore the perpetual blare of attack ads and vote in our own self interest, those we elect, Republican or Democrat, will still listen to the money that they think they need to be elected.

Given the recent McCutcheon Supreme Court ruling, it will take a constitutional amendment to correct this travesty and implement elections financed only by public funds. This is sure to be a long, drawn out process. So in the short term, I guess we all just have to learn to love living in a plutocracy, watching the rich get richer and everyone else get poorer, and trying to remember what it was like to live in a democracy.