Consensus leads to the madness of crowds, not the wisdom of crowds.  As we move to a government ruled by consensus, and intrusively pervading every aspect of society with its power, madness and evil prevails.

The wisdom of crowds happens when you collect people’s guesses or estimates for some fact, without them consulting each other, without them forming consensus first.

The opening anecdote of the book “The wisdom of crowds” relates Francis Galton’s surprise that the crowd at a county fair accurately guessed the weight of an ox when their individual guesses were averaged (the average was closer to the ox’s true butchered weight than the estimates of most crowd members, and also closer than any of the separate estimates made by cattle experts)

But the book also has many examples of the madness of crowds. The book tells us, when members of the crowd consult each other first, when they influence each other’s opinions, when they update their Bayesian priors from the priors of those around them, the crowd becomes markedly less wise, often becomes insane.

The crowd, he tells us, goes mad when the members of the crowd are too conscious of the opinions of others and began to emulate each other and conform rather than think differently.

In other words, consensus is apt to be madness.

And now I depart from the book, and tell you my own observations on my own authority, not that of James Surowiecki.

Our communications skills were evolved for the hunt and for war, where groups were small and feedback from the environment was strong, immediate, and impossible to ignore.  Ignore it, you would soon get hurt.

Humans are not well adapted to the mental life of large groups, to “the life of the mind”, meaning life without forceful feedback from the senses, feedback that is frequently accompanied by physical pain to force us to pay attention.

With larger groups, more feedback from people and less feedback from the environment, consensus building is apt to go into positive feedback loops, even without deliberate manipulation by the insane and the evil.

A bubble is a manifestation of a spontaneous positive feedback loop by the sane.

Add the evil and insane to the mix, and consensus will reliably go wrong.  The sane update their views from the consensus, the insane do not update so the consensus moves towards the insane, the evil lie and manipulate the Overton window, so the consensus moves towards what the evil purport to believe.

Linguistics theory, Chomsky’s universal grammar, is best understood as grantsmanship (the evil), an effort by academics who did not know or care much about foreign languages to take control of a juicy chunk of academia from  polylingual language geeks.  The lies about language continually and radically changed, reflecting not the pressure from the sane, nor updates on the basis of information, but, like the abruptly changing Soviet line, moves in a struggle over grants and power.  Global Warming is similarly a combination of grantsmanship (the evil) with the death-to-humankind greenies (evil and insane).

Anti dietary fat science is primarily the insane dominating the consensus (greenies and animal rights activists who are entirely unmoved by either evidence or the opinions of the sane).

The financial crisis is a combination of bubble (the sane are apt to spontaneously go off the rails by paying too much attention to each other and not enough to external reality) with evil (political loan allocation) and with the evil and insane (affirmative action going ever lefter than thou.)

The destruction of fatherhood, the financial crisis, and lots of others, including global warming, are all manifestations of the left singularity.  Lefter than thou is the way to power, so whatever direction the consensus tends to move, whether spontaneously as in a bubble or through madness, becomes a path for the evil to gain power,  (“Hey, we are all agreed on X, so we need to enforce X”) so whatever the direction that the consensus happens to be moving defines leftism, whereupon the evil push it ever further in that direction.  (“We need to enforce X even more than it is already being enforced.  Grant all power to us, and we will take care of X”)

Thus in the left singularity evil and madness invariably ally, to pursue ever escalating heights of madness.

The scientific method, (short form: “take no ones word for it”) was a conscious effort to be mindful of this flaw in our natures, and socially enforce behavior that protects the group from it. The scientific method is replication. He who invokes “consensus” preaches not science, but authority and faith.

The twinkle up, twinkle down consensus building behavior of OWS, on the contrary, is an effort to socially and coercively enforce this flaw in our nature, from which the evil and the insane benefit.

The corporate form is also an effort to protect us from this flaw in our nature.  The board appoints the CEO, and monitors him, but is not supposed to second guess him and direct him.  Consensus is socially prohibited.  The board chooses one guy, and goes with what he thinks. If they don’t like it, they choose another, but they are not supposed to switch too often, and not supposed to meddle.  When the board meddles, people in the investor class tend to view this as improper and corrupt.  They are supposed to look over his shoulder and keep an eye on what he is doing, but are not supposed to second guess him, short of firing him.

The reason that rentacops were so effective in dealing with OWS is the corporate form:

The shareholders theoretically appoint the board (though more commonly it appoints itself, and subsequently perpetuates itself).  The board appoints the CEO, and delegates to him full power over the assets of the firm.  He is not supposed to suffer any interference from the board, short of being suddenly fired, and mostly he does not.

He in turn delegates the full power of the property owner down the line (or at least he is supposed to), and in the case of security, delegates to the guys in each building.  Thus, when OWS attempted to occupy, the security guards did not need to consult with a bunch of suits, who would in turn consult with a bunch of lawyers, who would consult with … instead the security guards had all necessary authority to act ex tempore without consulting anyone, to exercise the sort of power over trespassers that a private owner would.   When dealing with outside intrusion, some poorly paid guy was able to speak with the full authority of the owners, the shareholders, since the shareholders had granted full authority to the board, the board to the CEO, and the CEO … all the way down to some poorly paid guy who has a stungun and pepper spray in his desk.  When the security guys decide to throw out some unwanted visitors, that is usually morally and legally the same as if they personally owned the building, for those who actually do own the building fully delegated that moral and legal authority to them.

Of course, just as it all too frequently happens that board does meddle, it also all too frequently happens that corporate decisions are made by committees, but it is not supposed to happen.  Committee management and matrix management is a manifestation of the mid level management hugging power to themselves.  One is likely to  see a meeting of twenty high status people, and one lower status person who does not speak much, the lower status person being the one who actually knows the matter being discussed, the one who is actually responsible for giving effect to the supposed consensus of the meeting.  But corporations are not supposed to make decisions by meetings and consensus, and mostly they do not.  To the extent that they do, they deservedly suffer ridicule.

The OWS model would have the shareholders gather in  a crowd, and twinkle up and twinkle down at each other.  In the corporate model, the poorly paid guy with a stungun in his desk is the avatar for the shareholders.  He is the property owner, in their place, exercising their full authority to deal with unwanted visitors.  He does not file a report to the shareholders proposing courses of action and wait for them to twinkle the various courses of action up or down.

Regulation, however, interferes with the corporate model.  To do something that is regulated, the corporation finds it has to get buy in from dozens, perhaps hundreds,  sometimes thousands, of meddlesome people.

In regulation, the evil and insane, which is to say the consensus, prohibit the sane (the corporate form) from acting, and even from sanity.  In the banking crisis, they demanded conformity not only in action, but in thought.

Markets are also a way of avoiding consensus, since each participant in the market is expected to outsmart all the others, thus as in science, replicate the research of each of the others.  The laws against “insider trading” attempt to prohibit this, but do not have the effect of enforcing consensus.  Price control and rationing does have the effect, but we are not getting that problem.

The corporate form is mostly sane because consensus is socially discouraged, replaced by delegating concentrated power freely, and concentrating power as much as practical.  The scientific method is sane, if actually followed, though markedly slower and less efficient than the corporate form, because consensus is discouraged for replication (“take no one’s word for it”).  The market is mostly sane, because market participants are supposed to strive to each be smarter than the rest, rather than to conform. Corporations exist because markets require more decision making by more smart people, because markets replicate decision making. Corporations economize on decision making, by telling people what to do.

Since committee decision making is expensive, as well as tending to madness, a corporation that finds itself holding meetings to make decisions should consider outsourcing the activities that are causing this problem to the market.

Peer review enforces consensus in science, as regulation enforces it against corporations.  And so the the insane take over the asylum.

Why has science stopped progressing?

Peer review came into broad application around 1942 or so, and that is pretty much when science stopped progressing.  Technology continued to progress until 1972, and some areas of technology continue to progress today, but large areas stopped progressing in 1972, and many additional areas of have very recently stopped progressing, at least in the West.

Because of peer review, Einstein’s special relativity paper would not be publishable today.  Any paper that is publishable today has lots and lots of citations to prove it is in line with the consensus.  Einstein’s paper conspicuously lacked citations, because it was not in line with the consensus.  Einstein was not an academic, and not a PhD, his paper had few or no citations, and radically up ended existing physics.

When I was taught special relativity, they did not tell us Einstein was right because the holy consensus tells us so, they had us replicate the calculations and review the evidence that Einstein presented in “On the Electrodynamics of Moving Bodies” just as if Einstein was some patent clerk with neither PhD nor academic position.

Einstein attempted to present special relativity as his dissertation, and it was rejected.  If rejected as his dissertation, would surely have been rejected had it ever been submitted to peer review.  So instead he submitted for his dissertation a don’t-rock-the-boat paper that contained nothing very new or interesting.

Each person replicating the research of each of the others can be costly.  A corporation reduces the cost of this, enabling the employment of people who are not bright, by telling them what to do. Externally a corporation is market oriented, each corporation replicating the research of all the other corporations in the market, but though externally a corporation is market oriented, internally, a corporation is socialism, but what people fail to notice is that internally it is socialism on the pattern of the Nazis, the socialism of the Führerprinzip, not the socialism of the modern left whose massive dysfunction we see on display at Occupy Wall Street.

This sounds like corporations are oppressive, and they are, but in practice it means that a low pay low IQ security guy does not need to hold a meeting, nor wire the board for instructions, when a bunch of bad guys attempt to occupy the office. Full concentration of power to the CEO is supposed to be accompanied by full delegation of power from the CEO, and usually it is.

The Führerprinzip is that you don’t have committees and you don’t have votes and you don’t have consensus.  Each leader (Führer in German) is delegated full authority in his own area by his leader.

According to allied propaganda, the Führerprinzip is that the Führer is above the law and incarnates the German people, but rather, the Führerprinzip is more the common sense observation that committees are dreadfully bad at making decisions, and you should appoint a smart guy with full authority to deal with X, and hold him fully responsible for any foul ups in X.

This maximizes the capability of hierarchical organizations to get lots of stupid people to perform functions that would require smart people, were they a multitude of independent operators in the market, and lowers the high cost of figuring out what to do.

In contrast, organizations that have lots of committees tend to be horribly Dilbertesque.  In practice, the socialism intended by the modern left is markedly worse than the socialism practiced by Hitler, in roughly the same proportion as the socialism practiced by the communists murdered more people than the socialism practiced by Hitler.  Rather than people being empowered by participation, they are oppressed  by meetings that they do not want to go to, and strangled by red tape.

Leftists want to slice power into lots and lots of tiny little slices, and share that power out between lots and lots of people, but this in practice is horribly disfunctional.  What it does is not empower people but instead ensure that decisions are evil and insane, in other words, ensure that decisions are left wing.  It also increases the cost of decision making.  If a decision is sufficiently important that it is worth spending the time of a lot of important people on it, then it should be made by the market, or by the scientific method, not by consensus.

Because the socialism of the Nazis was inherently saner than the socialism of the modern left, it was inherently less left wing, hence its markedly lower murder rate.  And thus the modern left, which is to say the modern state, reaches into science, markets, and corporations to remake them all into its own image, which is to say, make them all inherently evil and insane.

… we are undergoing cultural decay — ranging from the collapse  of art and literature after 1945 to the soft totalitarianism of  political correctness in media and academia to the sordid worlds  of reality television and popular entertainment

… how do we even know whether the so-called scientists are not just lawmakers and politicians in disguise, as some conservatives suspect in fields as disparate as climate change,  evolutionary biology, and embryonic-stem-cell research, and as I have come to suspect in almost all fields?

When tracked against the admittedly lofty hopes of the 1950s  and 1960s, technological progress has fallen short in many domains. Consider the most literal instance of non-acceleration:   We are no longer moving faster. The centuries-long acceleration of travel speeds — from ever-faster sailing ships in the 16th through 18th centuries, to the advent of ever-faster railroads  in the 19th century, and ever-faster cars and airplanes in the 20th century — reversed with the decommissioning of the Concorde  in 2003, to say nothing of the nightmarish delays caused by strikingly low-tech post-9/11 airport-security systems. …

… One cannot in good conscience encourage an undergraduate in 2011 to study nuclear engineering as a career.…

… In the next three years, the large pharmaceutical companies will lose approximately one third of their current revenue stream as patents expire, so, in a perverse yet understandable response, they have begun the wholesale liquidation of the research departments that have borne so little fruit in the last decade and  a half.
…

The single most important economic development in recent times has been the broad stagnation of real wages and incomes since 1973, …

Incomes, stalled since 1973, are now falling, across the board, afflicting all income quintiles, with no end in sight. Japan has been in decline for over a decade. There is no reason to think that this decline will end until its causes are remedied – and if never remedied, we may well wind up like so many vanished civilizations before us.

Since the decline effects all of society, every aspect of society, we have the luxury of looking of looking for causes where the light is best.

Let us look at three well studied instances of decline:   the Space Shuttle Challenger explosion, Wikipedia, and Washington Mutual.  I did not select these cases because they all support my thesis, but because they are conspicuous and good information is available for what went wrong.

1. The space Shuttle Explosion

   Low ranking engineers explained to their superiors in detail that the Challenger would explode if launched in cold weather and explained in detail how and why it would explode, but the high ranking “engineers” neither understood nor believed.

   Chairman Rogers: Well, let’s read it. “Loss of mission” – this is actual loss.

   “Failure effects summary: Actual loss. Loss of mission, vehicle and crew due to metal erosion, burn-through, and probable case burst, resulting in fire and deflagration.”

   …
   Mr. Mulloy: But about halfway through, after we had looked at all of the data, the conclusion and recommendation charts that Mr. Lundhad prepared came in and the logic for his recommendation, which did not specifically address don’t launch 51-L, what itsaid was that, within our experience base we should not operate any solid rocket motor at any temperature colder than we have previously operated one, which was 51-C.

   Chairman Rogers: Didn’t you take that to be a negative recommendation?

   Mr. Mulloy: Yes, sir. That was an engineering conclusion, which I found this conclusion without basis and I challenged its logic.

   Mulloy then repeats over and over again that he was not able to understand the explanation of why the shuttle was going to blow up, from which he concluded not that he was an idiot, but the engineers telling him it was going to blow up were idiots.

   “And this was a rather surprising conclusion, based upon data that didn’t seem to hang together, and so I challenged that.”

   Further, in describing how it did blow, he reveals he still does not understand the explanation of how it did blow up. In other words, he is an idiot, and, being too stupid to understand why the space shuttle was going to explode, and not wanting to believe it was going to explode, insisted on it being launched. Mulloy not only did not understand why the space shuttle was going to explode, but after it exploded, and the cause of the explosion had been found, studied, and explained again step by step, still did not understand how it exploded.

   So how is it that Mr Mulloy, and people like him, who do not know $#!% shit from beans, are in charge of people who knew and understood stuff?

2. Wikipedia

   Wikipedia has less information, and less useful information, than it used to.  This reflects its policy of presenting the official view on everything.  Where there is no official view, facts tend to get deleted as unsupported, or not encyclopedic, or some such.  Truth and knowledge is supposedly what comes from universities and the mainstream media.  If not in the universities or the mainstream media, is supposedly not truth. This leads to particularly bitter contention in political fields like climate science, evolutionary psychology, race, and Darwinism, but causes widespread damage in many non political fields, for example on computer science, since the vast majority of computer science knowledge is not academic.

   Contributors are instructed:  “Wikipedia is an encyclopedic reference, not an instruction manual, guidebook, or textbook. Wikipedia articles should not read like … instruction manuals. ”

   When I look something up related to computer science, it is normally because I am working on a project, and need to know how to do something, so I need something that reads like an instruction manual, guidebook, or textbook.  Further, anyone who knows computer science stuff is usually an engineer, so is apt to write like a textbook or instruction manual.  The effect and application of the not-a-manual rule is to prohibit contributions from people who actually do stuff, which contributions they intend to share with other people who actually do stuff, in favor of contributions by people who do not do stuff, and are incapable of doing stuff – which is to say, in favor of academic knowledge.

3. Washington Mutual

   Washington Mutual was able to take over many other better run banks, not because shareholders had confidence in Washington Mutual, but because regulators had confidence in Washington Mutual willingness to enthusiastically hurl vast amounts of money in the general direction of desired voting blocks. Kerry Killinger, CEO of Washington Mutual, became rich and powerful in substantial part through his cozy relationship with left wing activist organizations such as Acorn, which enabled him to control regulators as much as it reflected the fact that regulators controlled him.

   Washington Mutual took out ads condemning themselves for racism, and was given a bunch of other, more soberly run banks, to loot and destroy.

   Banks were told by regulators: “Lack of credit history should not be seen as a negative factor … In reviewing past credit problems,  lenders should be willing to consider extenuating circumstance”

   If a bank prevented people with no credit history from borrowing, this was a practice with “disparate impact” – which is “Raaaacism”. “Disparate impact” means you cannot apply standards at which non Asian minorities fail disproportionately – such as having documented income, a past history of paying their bills, and so on and so forth.

   When your regulator tells you that you “should” make easy money loans, you will make easy money loans, or suffer dire punishment.  And indeed, banks that did not make easy money loans did suffer dire punishment – they got taken over by Washington Mutual and its merry band of idiots.

   It is clear that Kerry Killinger and Angelo Mozilo sincerely believed that lending unemployed no-hablo-english wetbacks money to buy million dollar houses no money down was a good idea. They conned everyone of gigantic amounts of money, but their biggest victims were themselves and their banks.

   They did not pretend to believe in order to become rich and powerful, rather the regulatory apparatus efficiently selected stupid people who sincerely believed stupid things to become rich and powerful. If their beliefs had been feigned and cynical, a lot more of the disappeared money would have stuck to them.

   That Kerry Killinger was quite genuinely stupid was also demonstrated by the inability of Countrywide and Washington Mutual to manage their paperwork. Many of the titles that passed through their hands now have no paper trail showing who is the rightful owner, which suggests that bank was for the most part staffed by people whose IQ was below 105.

   Because political correctness requires stupid beliefs, selection for people who are sincerely politically correct, such as Kerry Killinger, selects stupid people, who in turn hire and promote other stupid people, so that no one in his bank could do a banker’s paperwork.

This is consistent with Codevilla’s analysis:  That that we are ruled by a ruling elite, credentialed but not educated by the very best universities, that is increasing narrow, ignorant, out of touch, and stupid!

Today’s ruling class, from Boston to San Diego, was formed by an educational system that exposed them to the same ideas and gave them remarkably uniform guidance, as well as tastes and habits. These amount to a social canon of judgments about good and evil, complete with secular sacred history, sins (against minorities and the environment), and saints. Using the right words and avoiding the wrong ones when referring to such matters – speaking the “in” language – serves as a badge of identity. Regardless of what business or profession they are in, their road up included government channels and government money because, as government has grown, its boundary with the rest of American life has become indistinct. Many began their careers in government and leveraged their way into the private sector. Some, e.g., Secretary of the Treasury Timothy Geithner, never held a non-government job. Hence whether formally in government, out of it, or halfway, America’s ruling class speaks the language and has the tastes, habits, and tools of bureaucrats. …

…regardless of where they live, their social-intellectual circle includes people in the lucrative “nonprofit” and “philanthropic” sectors and public policy. What really distinguishes these privileged people demographically is that, whether in government power directly or as officers in companies, their careers and fortunes depend on government.…

Professional prominence or position will not secure a place in the class any more than mere money. In fact, it is possible to be an official of a major corporation or a member of the U.S. Supreme Court (just ask Justice Clarence Thomas), or even president (Ronald Reagan), and not be taken seriously by the ruling class. Like a fraternity, this class requires above all comity – being in with the right people, giving the required signs that one is on the right side, and joining in despising the Outs.…

Much less does membership in the ruling class depend on high academic achievement. … But didn’t our [ruling elite] go to Harvard and Princeton and Stanford? Didn’t most of them get good grades?  … getting into America’s “top schools” is less a matter of passing exams than of showing up with acceptable grades and an attractive social profile. American secondary schools are generous with their As. Since the 1970s, it has been virtually impossible to flunk out of American colleges. And it is an open secret that “the best” colleges require the least work and give out the highest grade point averages. No, our ruling class recruits and renews itself not through meritocracy but rather by taking into itself people whose most prominent feature is their commitment to fit in. The most successful neither write books and papers that stand up to criticism nor release their academic records. Thus does our ruling class stunt itself through negative selection. But the more it has dumbed itself down, the more it has defined itself by the presumption of intellectual superiority.

We have statistical evidence that our ruling elite selects people who fit in at the expense of ability – that people who are excessively able in unappreciated ways do not fit in.

Participation in such Red State activities as high school ROTC, 4-H clubs, or the Future Farmers of America was found to reduce very substantially a student’s chances of gaining admission to the competitive private colleges in the NSCE database on an all-other-things-considered basis. The admissions disadvantage was greatest for those in leadership positions in these activities or those winning honors and awards. “Being an officer or winning awards” for such career-oriented activities as junior ROTC, 4-H, or Future Farmers of America, say Espenshade and Radford, “has a significantly negative association with admission outcomes at highly selective institutions.” Excelling in these activities “is associated with 60 or 65 percent lower odds of admission.”

all other things being equal, being an officer in the ROTC is likely to get you excluded from a prestigious university – any fool can see that political correctness counts more than ability or experience – whether in college admissions, or Obama’s picks for the federal reserve, or the post of CEO of HP, people are chosen primarily for their theology not their ability.

Codevilla continues:

Laws and regulations nowadays are longer than ever because length is needed to specify how people will be treated unequally. For example, the health care bill of 2010 takes more than 2,700 pages to make sure not just that some states will be treated differently from others because their senators offered key political support, but more importantly to codify bargains between the government and various parts of the health care industry, state governments, and large employers about who would receive what benefits (e.g., public employee unions and auto workers) and who would pass what amounts to indirect taxes onto the general public. The financial regulation bill of 2010, far from setting unequivocal rules for the entire financial industry in few words, spends some 3,000 pages (at this writing) tilting the field exquisitely toward some and away from others. Even more significantly, these and other products of Democratic and Republican administrations and Congresses empower countless boards and commissions arbitrarily to protect some persons and companies, while ruining others. Thus in 2008 the Republican administration first bailed out Bear Stearns, then let Lehman Brothers sink in the ensuing panic, but then rescued Goldman Sachs by infusing cash into its principal debtor, AIG. Then, its Democratic successor used similarly naked discretionary power (and money appropriated for another purpose) to give major stakes in the auto industry to labor unions that support it. Nowadays, the members of our ruling class admit that they do not read the laws. They don’t have to. Because modern laws are primarily grants of discretion, all anybody has to know about them is whom they empower.

This means that there really is no private enterprise any more. Everything is to a greater or lesser extent run by the ruling elite – and the ruling elite is not very bright, and is steadily getting dumber.

If someone is important and under pressure to perform (perhaps the board, being composed of major shareholders, wants the CEO to make a profit and will fire him if he does not) he will surround himself with the smartest people he can get – the Google policy. But if he is under no pressure to perform, he will prefer that those lower in status than him are not quite as bright as he is, other wise he is apt to find himself in the uncomfortable position of Mr Mulloy, wherein a low status person explains why he is wrong about something, and he fails to understand the explanation. Since our ruling elite exclusively works in fields where there is no pressure to perform it naturally finds itself more comfortable inducting new members of the ruling elite that are dumber than the existing members, so that with each generation, our ruling elite gets stupider and stupider. Once upon a time, the ruling elite was kept smart by the continual infusion of smart people from business, and was prevented from declining by an hereditary elite, but now, completely self enclosed, and under no pressure to perform, a purported meritocracy by slow degrees becomes an idiocracy.

I predict that wherever membership of the government bureaucracy is controlled by some meritocratic test, the test will be subverted to that it no longer has much to do with intelligence, because bureaucrats do not much like smart people.

Observe that even at Google, though they get the smartest engineers that they can, they have a very different policy for other parts of the company. Those that might have to deal with the state, are selected to fit in, and if you are dangerously smart, you are unlikely to fit in.

We are in decay because the our ruling elite, including our top scientists (who are not really scientists, but rather a priesthood who preach pseudo scientific rationales for whatever our rulers desire to do), are steadily getting dumber and dumber.

All the conservative criticism of her seems to be disappearing off the web, but what the hell, she stank, critics pointed out she stank, so someone killed her.   It might have been a leftist who did not think she was left enough, but chances are, was a conservative. Yes, chances are that unkind remarks by conservatives got her killed.  Pity it was not someone who mattered more.  Her platform was to create lots of high paying jobs in government and quasi governmental activities – in other words, to transfer wealth from productive people who mostly voted against her, to unproductive people who mostly voted for her, thus moving the nation generally leftwards.

As the nation plunges into bankruptcy, as the Cloward–Piven crisis approaches, we might kill enough similar wrongdoers to eventually get out of the crisis.  I don’t really see any other path to resolving the crisis other than watering the tree of liberty in the usual fashion.

In Cable 10Paris58, the writer announces that France is insufficiently left wing, therefore an American program of intervention in French internal affairs is required to move France further left.

“Gay Pride” is another illustration of the same process.  When the US implemented “Gay Pride” in the US, it implemented “Gay Pride” world wide.  And what is a gay pride parade called in Spanish?  el día del Orgullo Gay

The use of the American neologism “Gay” reveals who is calling the shots, who planned and organized this event.

Let us reflect on Aristide’s rule in Haiti:

The US intervened in Haiti to install Aristide at gunpoint and it also intervened in Haitian society and culture to convince Haitians that this was a good thing, was benevolent and progressive.

The US demanded an election. It then demanded an election rigged in Aristide’s favor. He won, was overthrown. US demanded with threat of violence that he be reinstated. He was reinstated again, overthrown again. US invaded, installed him on the presidential throne with the guns of US marines, and, just to make sure Aristide did not get up to any mischief, surrounded him with an all white praetorian guard.

You will probably read all over the internet and the mainstream media that the numerous occasions in which Aristide was removed from power were evil American plots by evil America to deprive Aristide of his immensely popular and well deserved power.  Each of the supposedly anti American sources saying that stuff is a US state department muppet – someone from the state department has his arm up the speaker’s @$$ and his fingers are moving the speaker’s lips – pretty much in the way the praetorian guard were moving Aristide’s lips.

They are indeed anti American – because the US state department and the US ruling elite is anti American.

Just look at the races of the actors.  The people who installed Aristide were white Americans.  The people who guarded him were white people of undisclosed nationality.   (Not all that undisclosed – when everything fell apart, Aristide’s praetorians were rescued from black Haitians by the US marines)  The people Aristide fled were black Haitians.

It is not the Joos, it is Harvard and the State Department, not a sinister Jooish plot, it is a sinister Harvard plot.  It is a government conspiracy to impose more government on those who can least resist it – the French being less able to resist than Americans, and the Haitians being less able to resist than the French.

The 1994 intervention in Haiti is not in itself all that important, Haiti being just a small pimple, but it is important in what it reveals – like Cable 10Paris58 it reveals the true face of US imperialism.

the purest and most uncompromising of which are the anarchists.

In fact, left anarchists are astroturf. They are the government threatening those that would restrain its growth.

Repeating my previous post on the Greek riots:

Observe the recent firebombings in the Greek riots, where the “rioters” murdered three people.

Here are a couple of videos of the “rioters” firebombing police.

The “rioters” charge the police, and bang on their shields with light sticks, making no attempt to jab through the gaps at the actual bodies of the cops, nor using sticks heavy enough to even shake the shields.    No axe handles or baseball bats.

Hey guys, if you want to bang on armored cops, I have a sledgehammer that would make a pretty good mace. It goes through concrete mighty fast.

They then fall back, and hurl firebombs – but they do not not hurl firebombs at the police, but at the ground in front of the police.  One cop gets one of his boots splashed with burning petrol.  He rolls around, and a couple of other cops put him out.  In the second video, same scene shot from a different angle, we observe that the cops make not the slightest attempt to arrest the firebombers for attempted murder, and the rest of the mob for assault and as accessories to attempted murder.  It is all theater.  When they see that one of the firebombs has actually hit, the theater pauses.

When right wing militia listens politely to an FBI provocateur provocateur at a meeting proposing that they bomb someone, they all go to jail for plotting crimes.  The “rioters” firebomb a cop, and everyone acts like it is an unfortunate accident – which of course is exactly what it is.

The “rioters” in the Greek riots are government employees put on the streets by government sponsored unions that are themselves as much part of the government as the police were.

Observe:  We have arrived. America is now a totalitarian terror state.

In 1992 I visited Cuba.  Thereafter, I argued it was a totalitarian state, because when I asked certain questions some people fled, fearing that merely hearing the question would result in them being punished for the thoughts it might elicit, and others answered furtively.

Yesterday, I asked someone very close to me a question apt to have a politically incorrect answer (I cannot identify him further, for he swore me to secrecy)

He looked around furtively.  We were on top of a hill overlooking the Coral Sea in a semi rural area, the other side of the world from his workplace.  He lowered his voice.  He then proceeded to utter a series of politically correct platitudes, with gestures and grimaces reversing their meaning, his grimaces implying the opposite of the ostensible meaning, the same sort of communication coded against possible eavesdroppers and hidden microphones that I encountered in Cuba, where they would swear loyalty to communism, while making a gesture of their throats being cut.

Like Havel’s green grocer, the truth would destroy his career.

This is the behavior that in 1992 I saw in Cuba and thereafter used as evidence that Cuba was a totalitarian state, a state of omnipresent fear.

So if Cuba was totalitarian in 1992, America is totalitarian in 2010.   We have arrived at the end of Hayek’s “Road to Serfdom”.

In America, unlike Soviet Russia, we don’t send dissidents to Alaska, and although lots of American psychiatrists are eager to diagnose political deviation as mental illness and treat it with electroshock and lobotomy as they do in Cuba, government has as yet declined to employ them in this capacity.  But what government does do is ensure that political deviation blights your career.  If a company knowingly employs political deviants, it is apt to be sued by quasi governmental organization for a “hostile work environment”, in which lawsuit, no evidence will be presented of anyone saying unkind things to those for which the work environment was supposedly hostile, but evidence will be presented that employees had subversive thoughts – often evidence that they expressed subversive thoughts far from their workplace, as perhaps on a hill overlooking the Coral sea the other side of the world from his workplace – so the company will be punished, for failure to punish subversive thoughts.

Hayek, in “The Road to Serfdom”, argued that regulatory welfare state must inevitably become totalitarian.  Lo and behold, totalitarianism has arrived.  Most people, everyone with some position in society, everyone with something that could be taken away from them, are very, very frightened.

And what is totalitarianism?  Hayek’s totalitarianism seems to be pretty much Havel’s totalitarianism, and here is Havel on totalitarianism:

The manager of a fruit-and-vegetable shop places in his window, among the onions and carrots, the slogan: “Workers of the world, unite!”

Why does he do it? What is he trying to communicate to the world? Is he genuinely enthusiastic about the idea of unity among the workers of the world? Is his enthusiasm so great that he feels an irrepressible impulse to acquaint the public with his ideals? Has he really given more than a moment’s thought to how such a unification might occur and what it would mean?

I think I can safely assume that the overwhelming majority of shopkeepers never think about the slogans they put in their windows, nor do they use them to express their real opinions. That poster was delivered to our greengrocer from the enterprise headquarters along with the onions and the carrots. He put them all into the window simply because it has been done that way for years, because everyone does it, and because that is the way it has to be.

If he were to refuse, there could be trouble. He could be reproached for not having the proper decoration in his window; someone might even accuse him of disloyalty. He does it because these things must be done if one is to get along in life. It is one of the thousands of details that guarantee him a relatively tranquil life “in harmony with society,” as they say.

Obviously the greengrocer is indifferent to the semantic content of the slogan on exhibit; he does not put the slogan in his window from any personal desire to acquaint the public with the ideal it expresses. This, of course, does not mean that his action has no motive or significance at all, or that the slogan communicates nothing to anyone.

The slogan is really a sign, and as such it contains a subliminal but very definite message. Verbally, it might be expressed this way: “I, the greengrocer XY, live here and I know what I must do. I behave in the manner expected of me. I can be depended upon and am beyond reproach. I am obedient and therefore I have the right to be left in peace.”

This message, of course, has an addressee: it is directed above, to the greengrocer’s superior, and at the same time is a shield that protects the greengrocer from potential informers. The slogan’s real meaning, therefore, is rooted firmly in the greengrocer’s existence. It reflects his vital interests. But what are those vital interests?

Let us take note: if the greengrocer had been instructed to display the slogan ‘I am afraid and therefore unquestioningly obedient,’ he would not be nearly as indifferent to its semantics, even though the statement would reflect the truth.

The greengrocer would be embarrassed and ashamed to put such an unequivocal statement of his own degradation in the shop window, and quite naturally so, for he is a human being and thus has a sense of his own dignity. To overcome this complication, his expression of loyalty must take the form of a sign which, at least on its textual surface, indicates a level of disinterested conviction. It must allow the greengrocer to say, “What’s wrong with the workers of the world uniting?”

Thus the sign helps the greengrocer to conceal from himself the low foundations of his obedience, at the same time concealing the low foundations of power. It hides them behind the façade of something high. And that something is ideology.

As Bruce Charlton points out:

If you go into an institutional environment – a government office, a school or college, a hospital or doctor’s surgery, a museum, public transportation – and you observe posters adorning the walls on politically-correct topics such as diversity, fair trade, global warming, approved victim groups, third world aid – remember Havel’s essay, and that the correct translation of such posters is as follows:

“I am afraid and therefore unquestioningly obedient”

Such posters are a coded admission of submission to ideology – except in the rare instance where they advertise genuine corruption by ideology.

The frequency of such posters nowadays, compared with a generation ago, is a quantitative measure of the progress of totalitarian government.

As with third world and Marxist countries, the government’s reaction to bad news is to declare a new era of prosperity.  The recession is officially over.  With an unprecedented proportion of the workforce on the government payroll, productivity has officially risen to amazing heights and somehow, despite the big increase in the proportion of people on the government payroll, public spending has officially not risen much.

Unofficial inflation, however, is starting to look quite frightening:

Market Ticker tells us:

I just got back from the grocery store.  Eggs, which were $1.60 two weeks ago, are now $1.99/dz.  Butter?  Two boxes for $6 – on sale.  The same two boxes were $4.50 a couple months ago.  Land-O-Lakes Brand?  $4.89 – each.
Cheese?  8oz bricks were commonly 3/$5 as recently as September.  Now?  $3.50 – for one.
But there’s no inflation, you see.
Oh, and on the way home I passed the gas station.  It was $2.59 for regular a couple of weeks ago.  Now?  $2.89.  30 cents in about 2 weeks, a 12% increase.

This is consistent with inflation rates of thirty to fifty percent per year, early hyperinflation rates.

Sarah Palin is, as usual, on the ball, while ruling class is floating away in La La Land, sincerely puzzled that the peasants are failing to eat cake.

This is the decisive test of Keynesianism.  Of course, we already had a decisive test of Keynesianism:  The Japanese crisis.  Keynesianism failed dismally, to which the Keynesians replied that Japan’s troubles were the result of not applying Keynesianism vigorously enough.    This time, however, it has been applied vigorously enough.  The results should be apparent by around 2012-2016.  The fat lady has not yet sung, but so far, things are not looking good for Keynesianism.

Money is a matter of functions four,
a medium, a measure, a standard, a store.

There is a conflict between the use of money as a store and the use of money as a standard, since if everyone wants to store value at the same time, the value of money is apt to rise, and if everyone wants to use their store at the same time, the value is apt to fall.  Keynesianism therefore addresses a real problem, but its proposed solution tells the ruling class what they want to hear – that they can buy votes with money they do not have, that they can eat their cake and have it to, which is of course not true, and not a solution to the problem.  Keynesianism addresses a real problem, but is not a real solution.

It seems to me that a sounder solution would be to target the long run value of money.  If people had confidence that in the long run, the value of money would be constant, that inflation would run for a few years to be followed by deflation, and deflation would run for a few years to followed by inflation, that what goes up must come down, then I doubt that natural fluctuations would be large or damaging.   Fluctuations are large and damaging because there is no telling what the future value of money is likely to be, because Keynesianism makes money dangerously ineffectual as either a standard or as a store.  This large uncertainty destabilizes the economy.  The objective of monetary policy should be to give people confidence that the value of money will be the same in twenty or thirty years, even if it fluctuates a bit from year to year.

Of course, I am prescribing what an honest issuer of fiat money should do, if he cares about the long term, and wants everyone to continue using the fiat money he issues.  Since issuers of fiat money sooner or later find themselves in a situation where the major question is whether the political leadership will survive another week, such advice is unlikely to be heeded.  Keynesianism will continue to be believed, not because it is true, but because issuers of fiat money are compelled to act as if it was true.

If anyone is allowed to disagree with the orthodoxy taught at Yale and Harvard, or even doubt it, this endangers the free speech of people from Harvard and Yale, and similarly if any enterprise run by people from Harvard or Yale could go bust, this endangers the free enterprise of people from Harvard and Yale.

Basel II is tens of thousands of pages of regulations, no one knows how vast it is, because not all the regulations can be found in any one place, but it could all be replaced by two simple rules:  Politically correct victim groups shall always find it easy to borrow money, regardless of their ability or intention to pay it back, and politically well connected businesses shall always make money, regardless  of whether they are competently run or not.

The seeds of the crisis were the CRA and the ratings agencies.  I have discussed the CRA at length, but the CRA would have been resisted had it not been for other changes in the system that insulated the players against the consequences of making bad loans.  These changes, guaranteeing that badly run businesses would succeed, started with the bailout of the ratings agencies in the seventies, forty years ago.

Back then, the ratings agencies were in trouble, because they had made a lot of bad calls.  It seemed that whenever an institution was going under, the guys at the credit rating agencies were the last to know about it.  Back then, they sold their assessments of credit risk to subscribers. So no one wanted to subscribe.

So in the seventies, the regulators stepped in to make people use the credit rating services. In 1975 the SEC created the Nationally Recognized Statistical Rating Organization (NRSRO) designation. Credit rating agencies so designated received what was in effect a grant of governmental power. The SEC then relied on the NRSRO’s credit risk assessment in establishing capital requirements on SEC-regulated financial institutions – which meant that for SEC-regulated financial institutions to borrow and lend, they had to get rated.  A cascade of regulatory decisions followed over the years, each decision forcing more and more reliance on the risk assessments issued by these demonstrably incompetent institutions – and less and less reliance on other people’s risk assessment.  For more and more organizations, it became illegal for them to make their own judgments about risk.

By the 1990s, as Levine and Partnoy tell us, the NRSROs were not selling assessments of credit risks, but licenses to issue securities.  The rating agencies did not genuinely assess risk, nor did anyone really expect them to.  Nor could repeatedly demonstrated incompetence reduce demand for their services, so the ratings agencies had no incentive to provide correct credit ratings.  Since their income was entirely dependent on the state granting them power, they did, however, have an incentive to make politically correct credit ratings.  If you lend to the poor, the oppressed, etc, and you are run by good old boys from Yale and Harvard, and you make donations to the right politicians, the NRSROs have a very powerful incentive to give you a good credit rating.  And if you have a good credit rating, you can borrow as much as you like – and if you go bust, the government will bail you out.

Badly run companies that had been empowered to borrow as much as they pleased got in trouble – and were bailed out for the same reasons as they had been empowered to borrow as much as they pleased.

In addition to corruptly favorably rating the politically correct, the NRSROs corruptly favorably rated those who simply gave them money, which is perhaps what those who complain about “deregulation” have in mind.  The banks creating structured financial products would first pay the rating agencies for “guidance” on how to package the securities to get high ratings and then pay the rating agencies to rate the resultant products – a glaring conflict of interest, though one less apt to lead to bailouts when the proverbial hits the fan.

Now since all this dirty dealing has cost the taxpayer trillions, you may well ask what measures have been taken to punish the NRSROs for bad conduct, or give them incentives for better conduct in future, or indeed restrain them from continuing to do this stuff?

All the strengthened regulation is regulation to make people continue to treat NRSRO ratings as true, even though it has become horrifyingly apparent that the ratings are generally false.  All the strengthened regulation is more of what caused this mess in the first place.  Any real reform would necessarily start by abolishing the legal privilege of NRSROs, would have to start by rolling back regulations to what they were in 1974.  Instead, compulsion and bailouts are being applied to make NRSRO ratings true, or to enable people to continue pretend that they are true.  Their power has been increased, their misconduct unpunished, and their incentives have become even worse.

none of them would be a Truther, a supporter of cop killer Mumia Abu Jamal, or a communist… let alone all three. His Supreme Court nominations would not have to defend their racial theories of judicial supremacy at their confirmation hearings.

And that is precisely why McCain would have been worse: He would have implemented the policies of financial ruin, national socialism, economic destruction, defeat and humiliation, from the “center”, and these policies would have been associated with Sarah Palin instead of Bill Ayers and Reverend Wright.

That is not too alarming in itself. It is a bit less than GDP, and for most countries, trouble ensue when debt is around twice GDP. The liberty papers are not too worried.

Total American indebtedness (public and “private”) is sixty trillion, which is much larger than federal debt, and has been rising very rapidly. The primary cause of this rise has been implicit and explicit governmental and quasi governmental guarantees – FHA guarantees, debt of too-big-to-fail corporations, guarantees by too-big-to-fail corporations, state debt, for example California, and so on and so forth.

Some substantial part of this sixty trillion is secured by real assets such as houses and the income stream of hard working people, and some substantial part is not.

Thus the excess “private” debt is not private.  The normal level of public and “private” debt is about twice GDP, say twenty six trillion, so we are about thirty trillion or so in the hole and getting deeper fast – well past the danger level of twice GDP.