Links: Massive projects, counterfactuals, Henry Miller, dating mores, the end of reflection, and more!

* New York’s Incredible Subway. Seattle is actively building subways. Denver is also building light rail (with surprising speed). It’s almost like other metros are learning from New York’s successes and Los Angeles’s mistakes.

* “If the atomic bomb had not been used,” one of the most fascinating pieces you’ll read if you’re familiar with the topic; call this a revision to revisionist history.

* “Henry Miller’s fail.” I tried and failed to read Tropic of Cancer and Tropic of Capricorn when I was a teenager, and once or twice since, but they do nothing for or to me.

* International Energy Agency: Electric vehicle battery costs rapidly declining.

* “The Economist Who Just Won a Nobel Prize Thinks Owning a Home Is a Terrible Investment: If everyone you know is telling you to buy a house, you should read Robert Shiller’s work.” The more I learn about the economics and opportunity costs of owning real estate the more puzzled I am by the American cultural fascination with ensuring high levels of employment in the property exchange industry.

* “The Venmo Request: A New Wrinkle in Modern Dating.”

* “Why even driving through suburbia is soul crushing

* Texas is the new California, but its status won’t last: “The cost of maintaining an equally endless amount of horizontal infrastructure will inevitably outstrip tax revenue over the next generation.” I’m not sure, and the argument is less analytic than it should be, but still.

* “The End of Reflection“?

* How they got their guns,” a chilling yet fascinating piece.

* Tom Wolfe’s excellent, prescient Paris Review interview.

Life: The trap edition

The pursuit of easier life resulted in much hardship, and not for the last time. It happens to us today. How many young college graduates have taken demanding jobs in high-powered firms, vowing that they will work hard to earn money that will enable them to retire and pursue their real interests when they are thirty-five? But by the time they reach that age, they have large mortgages, children to school, houses in the suburbs that necessitate at least two cars per family, and a sense that life is not worth living without really good wine and expensive holidays abroad. What are they supposed to do, go back to digging up roots? No, they double their efforts and keep slaving away.

—Yuval Noah Harari in Sapiens: A Brief History of Humankind, which is quite good, though the above is out of context.

I wonder how much of the financial arms race is driven by a) parochial housing policies and b) the number of people who genuinely enjoy the work at high-powered firms. Some small number of people do really enjoy being lawyers. Not many, but they exist.

Links: Tech changes culture, beyond the salacious, IKEA, pulp fiction, business, and more!

* “Sex and the Industrial Revolution,” though this has already made the blog rounds.

* “Beyond the Simply Salacious: Five Stories on Adultery,” though is it gauche to link to links posts? Tony Tanner’s Adultery in the Novel: Contract and Transgression also covered related grounds many years ago. It is striking how few modern works of criticism could be of interest to the general reading population.

* “Is the IKEA ethos comfy or creepy?” Both, though I have a special hatred of IKEA, plus an amusing-in-retrospect story that takes place in one. It relates to this: “Alan Penn [. . . ] conducted a study of the IKEA labyrinth and deemed it sadomasochistic.”

* “The birth of Pulp Fiction,” which is interesting for many reasons, one obvious one being between paperbacks and ebooks. I do think ebooks are vehicles for “for social and cultural enlightenment” and that they will further “de-provincialize the American public.” One can already see this in 50 Shades of Grey, for example, despite the bad prose. The intellectual elite is already mostly de-provincialized but political correctness and some related movements have re-provincialized large precincts of it.

* “On Triangl, maker of the ‘world’s [allegedly] hottest bikini’?” This is actually about making it in the apparel business and fulfilling customers desires.

* “Actually, Our Military Keeps Winning,” an essay contrary to current dominant narratives. If you aren’t reading James Fallows you should be! On New Year’s Eve we saw American Sniper, which was incredibly intense and whether it can be read as a pro- or anti-war movie probably depends on the viewer’s outside knowledge.

* People now move to the Southeast from California and the Northeast, not surprisingly since the Southeast is where the cheap housing is. While Californians and New Yorkers endlessly debate supposed income inequality they perpetuate it by forbidding new housing supply. I want to move to Austin or perhaps Denver. My parents left California for Seattle when I was a kid due to housing costs and crap schools, and now Seattle and environs are following California’s lead by pricing people out of the market. See Matt Yglesias.

* Behind the scenes of Australia’s prostitution boom.

Links: Unmastered: a bad sex memoir, the humanities in life, bikes, housing, happiness, and more

* “Lust Never Sleeps: An academic’s sexual memoir puts the ire in desire;” sample: “Once in a while a book appears that’s so bad you want it to be a satire. If you set out to produce a parody of postfeminist mumbo jumbo, adolescent narcissism, excruciating erotic overshares, pseudopoetry, pretentious academic jargon, and shopworn and unshocking ‘dirty talk,’ you could not do better than Unmastered: A Book on Desire, Most Difficult to Tell.” I bought Katherine Angel’s Unmastered on the strength of an interesting interview and returned it after a few pages of reading and casually flipping through the remainder. I was hoping for something like Bentley’s The Surrender and sadly didn’t get it.

* This Is How to Leak to the Press Today; parts are overwrought: “With the recent revelation that the Department of Justice under the Obama administration secretly obtained phone records for Associated Press journalists — and previous subpoenas by the Bush administration targeting the Washington Post and New York Times — it is clear that whether Democrat or Republican, we now live in a surveillance dystopia beyond Orwell’s Big Brother vision,” but the how-to is accurate.

* “The Humanist Vocation;” I would add that the humanities are extremely important, but the humanities as currently practiced in most university settings are not, and the distinction is a key one for understanding why many people may be turning away from them.

* “Own Your Neighborhood: The real-estate crowdfunding scheme that could revolutionize urban policy by destroying stupid NIMBYism.”

* Alan Jacobs: “Am I a Conservative?” Notice that he does not see the contemporary Republican party as being particularly conservative; his second and third reasons are more interesting than his first.

* The U.S. has become the kind of nation from which you have to seek asylum—that is, the kind of nation you hide from, not go to for protection.

* A Prolonged Depression Is A Poor Affordable Housing Policy.

* The Netherlands is swamped by bikes, which is pretty cool.

* AAA says that the TCO of a car is $9,000 a year.

* The secret to Danish happiness; not all lessons transfer but I take Citi Bike (for which I’ve signed up) and similar efforts as a small step in a positive direction.

George Packer’s Silicon Valley myopia

It’s ironic that George Packer’s New Yorker article about the tech industry’s supposed political insularity is itself hidden behind a paywall (if this were a New Yorker article, I would cite statistics demonstrating the wealthy demographic served by the magazine and mention a telling detail about the luxury watches advertised within, perhaps with with the cost of the watches as a percentage of median household income used as a comparison). Packer makes a lot of noises about concern for the poor, but genuinely poor people might not be able to afford the magazine and now can’t even read the article about how San Francisco is alluringly pricing them out San Francisco for free.

Perhaps the weakest part of the article comes from references to housing prices, like “the past two years have seen a twenty-per-cent rise in homelessness, largely because of the soaring cost of housing.” But he doesn’t explain how limited supply in the face of increasing demand raises prices, as Matt Yglesias does in The Rent is Too Damn High or Edward Glaeser does in The Triumph of the City. There is a simple solution deploying century-old technology that can ameliorate San Francisco’s housing crisis.

Both Glaeser and Yglesias correctly observe that many urban jurisdictions prevent housing from being built; as a result, prices rise. But it’s not primarily tech companies or their employees who have driven housing prices in Silicon Valley: it’s residents themselves, and the courts that have given residents and politicians extraordinary powers to block development. That’s why “San Francisco is becoming a city without a middle class,” as Packer says in the article.

My own family was part of that exodus: my parents moved us from northern California to suburban Seattle in 1994 because housing prices were unreasonable and because California was becoming an increasingly bad place for middle-class people. Since then, housing prices have continued to drive most population growth towards places like Seattle, Phoenix, Las Vegas, and many of Texas’s cities, especially because urban development is easier in Sun Belt cities. Seattle, unfortunately, appears to be following in California’s footsteps by restricting the growth of housing stock and thus causing prices to rise.

The housing-price thing is one of my own pet peeves, since so few people connect supply restrictions, demand, and pricing; even Steven Berlin Johnson’s otherwise interesting rebuttal buys into Packer’s economic illiteracy. Beyond the housing issues, Packer writes:

Joshua Cohen, a Stanford political philosopher who also edits Boston Review, described a conversation he had with John Hennessy, the president of Stanford, who has extensive financial and professional tides to Silicon Valley. “He was talking about the incompetent people who are in government,” Cohen recalled. “I said, ‘If you think they’re so incompetent, why don’t you include in a speech you’re making some urging of Stanford students to go into government?’ He thought this was a ridiculous idea.”

Hennessy is more right than Cohen: if the system itself doesn’t work, why would anyone want to join it? Few highly competent people want to be ruled by incompetent people, and in government seniority rules. There’s often no way to make important changes from the bottom and no way to reach the top without going through the intermediate layers. That’s presumably why Hennessy doesn’t urge “Stanford students to go into government.”

In tech startups, if you think your company is doing something stupid and everyone ignores you, or ignores an obvious opportunity, you can leave and start your own startup. If you start your own version of government within the U.S., men with guns will show up to stop you.

Although Hennessy might not put it the way I have in the above paragraphs, such thinking is probably behind his statement (assuming, as I do, that Cohen is expressing it reasonably well). I’m writing this as someone whose business is to deal with various sections of federal and state government. It’s hard to imagine that Packer has this kind of experience; if he did, I doubt he’d have the worldview he does.

Packer does note that government investment in technology and research is partially responsible for the Silicon Valley of today (“The Valley’s libertarianism—which ignores the federal government’s crucial role in in providing research money—is less doctrinal than instinctive”), and that’s an important government contribution. But today, spending on science and medical research occupies about 2% of the federal budget; by contrast, spending on old people in the form of Social Security and Medicare occupies about 30%. Warfare, formally known as “Defense and International Security Assistance,” occupies 19%, and some of that goes to R&D of various kinds.

If federal R&D spending were higher as a proportion of the federal budget, Silicon Valley types would probably be much more pro-government. Note that this is a positive statement more than a normative one—that is, I’m not trying to argue that more money should be allocated to R&D and less to old people, but I do think we’d see a more positive view of government among Silicon Valley-types if we did.

There is this comment, which is somewhat myopic and somewhat accurate:

Technology can be an answer to incompetence and inefficiency. But it has little to say about larger issues of justice and fairness, unless you think that political problems are bugs that can be fixed by engineering rather than fundamental conflicts of interest and value

Regarding “larger issues of justice and fairness,” 300 years ago people who couldn’t work starved to death, median life expectancy was low, and numerous infants died of now-preventable diseases. Until the Industrial Revolution, starvation was a reasonably common and regular occurrence. Today, no industrialized countries have mass starvation, and that’s largely because of the technological and scientific progress that enables the social and monetary surpluses to provide important safety nets that Packer now takes for granted. “Political problems” are still real and still important, but so is a sense of progress that has enabled society, collectively, to worry much more “about issues of justice and fairness,” instead of working continually on farms. Technology actually has a lot “to say about large issues of justice and fairness,” because technology has given us the leisure to think about those issues and the wealth with which to address them.

In addition, Packer is mixing up questions about “fairness,” but, as as Roy Baumeister writes:

Fairness is important in all human social relations, whether large or small. But there are two different kinds of fairness. Experts call these equity and equality. Equality means treating everyone the same (obviously). Equity means giving out rewards in proportion to what each person contributed. Under equity, the person who contributes more or better work gets a proportionately bigger share of the reward (97).

Packer is focusing on equality, as he does throughout the article, but equity is important too, and New Yorker and New York Times articles almost always ignore this in discussions of “justice and fairness.” Fairness has to balance how rewards accrue to those who have made outsized contributions versus those who haven’t. That Packer doesn’t even acknowledge this distinction tells us a lot about the political glasses that color his world outlook but very little about how to think about the trade-offs involved with equality versus equity. There is a reasonable argument to be made about how governments should take more from major economic winners and give that to those who aren’t producing much of economic value, but Packer doesn’t even acknowledge these issues.

Connecting the dots between beliefs: an example from density and housing policy

In “New York City, NIMBY Paradise: New Yorkers genuinely believe that their housing restrictions are normal” Megan McArdle points out that “a combination of zoning ordinances, building permits, and local NIMBY opposition had made New York distinctly unfriendly to new development, and that it would be rational to build far more units than the city currently allows” but that “I am constantly surprised by the extent to which New Yorkers regard all this not only laudatory, but normal–even as they bemoan the high cost of housing.”

I too am surprised. It’s at least intellectual coherent to complain that prices are high or to argue that development should be limited, but the two together is bizarre. I’m living in Manhattan and occasionally lament to friends or people in bars or whatever that we don’t get more housing built,* which would reduce rents (or at least rent increases), and they inevitably look at me like I’m from Mars. Then they say, “But there’s construction all over the city!” Which is (sort of) true, in the sense that walking around the East Village and LES reveals a fair number of projects—but almost all of them are short. When I mention supply and demand, I get funnier looks, like I’ve just revealed I’m a community, Christian, libertarian, or some other suspicious outsider.

I just don’t think most people connect difficulty in building, or how supply affects demand.

IMG_2181The other day I was wasting time on Reddit and spent time responding to people in this thread about housing in Seattle, which is another place where it’s hard to build and rents are rising, and a lot of people on the thread manifest the kind of difficulty in connecting supply and demand you’re talking about in your post and that I’ve noticed out and about. If I were being mean / direct, I would posit that most people like to complain and don’t understand, or choose not to understand, simple economics.

If I’m being less mean, I’d argue that most people just lunge at a random opinion, hold it, and don’t really think anything more about it; that’s one of Jonathan Hadit’s important points in The Righteous Mind. Still, I never hear, “Extensive housing regulation leads to high prices and that’s a desirable trade-off,” or “We should accept high prices as a reasonable consequence of limiting construction.” Those are normative statements and closer to morality or philosophy, and they’re at least reasonable.

Most people, however, have only a vague sense of the link between public policy and their living arrangements. My Dad, when I told him about this, mentioned that he used to work for cities and had to listen to people express their opinions, most of which were incoherent. Apparently little has changed, except that the incoherent can organize through the Internet.

Anyway, Matt Yglesias has pointed out in many contexts that “Gentrification can’t be stopped by halting construction—to have a chance you need even more construction.” People with money will simply outbid people with less for scarce real estate resources, and various legislative efforts to prevent this basic dynamic have failed and always will fail because people are cleverer than legislatures and markets want to clear. It’s also common for people in hot urban areas like New York and Seattle to lament gentrification, high rents, and developer avariciousness.

If this were limited only to random idiots in bars and coffeeshops, that would be okay, but many reporters are economically illiterate too. One recent random but representative example is Lynn Thompson’s Seattle Times story “Would new rules leave loopholes for big houses on small lots?,” which spends 900 words discussing housing issues but doesn’t include supply or demand.

I sent a letter to the editor of the Seattle Times and to Thompson pointing this out, and I got a nice note back from Thompson saying that “I did another story about a month ago that found that we have enough growth through 2040 under current zoning [. . . .]” But what does “enough” mean? It too is a basically incoherent concept, at least in economic terms, because particular individuals don’t know what “enough” means. That’s why we have markets. Moreover, she didn’t mention price, or the pricing issues

Her colleague Sanjay Bhatt, however, reported that Single-family home prices rose by 20% from 2012 – 2013, and rents in Seattle and environs have been rising faster than inflation for a decade or more.

Why don’t reporters working in this field understand econ 101? And why do editors let them get away with it? The omission is glaring, and it works to undermine the confidence of anyone with any reasonable amount of knowledge in the Seattle Times (and other papers, which routinely make the same kinds of errors). I don’t mean to pick on Thompson or the Seattle Times in particular, since they just happen to be salient examples and the general problems I’m describing here are widespread.


* Are or sex chat are more fun and was the norm is college, but not everyone is ready for the latter five minutes after meeting. A shame, really, but I learned many things from Martha McPhee’s wonderful novel Dear Money, and one is that people above the age of 30 often regard real estate and wealth as a sort of sexual sport.

Thoughts on possible and perceived income inequality

Someone in my family sent me “Standard of Living Is in the Shadows as Election Issue,” which is about how we allegedly need to break “out of a decade of income stagnation that has afflicted the middle class and the poor and exacerbated inequality.” But measuring standard of living solely through income has a couple of major problems. One is that a lot of people are getting life improvements through non-income-based measures (surfing the Internet is an obvious example). It also appears that the average basket of goods consumption is changing. Anyone who has to or chooses to consume health care or education is really hurting. Anyone who isn’t is arguably benefiting from the major drop in prices for virtually all manufactured goods.

I’m not convinced that income inequality has changed as much as the media believes it has. Robert J. Gordon wrote “Has the Rise in American Inequality Been Exaggerated?,” which argues that the indices used to measure inequality are flawed, that a lot of income is now needlessly spent on housing (primarily because so many cities restrict housing supply through various means, including arbitrary parking requirements and height limits), and that behavioral choices and changes may have changed perceived inequality. I don’t want to argue the merits of Gordon’s paper. His explanations are at least plausible, and that the more one tries to measure these kinds of changes, the harder it is to really know if what one is measuring is real or evidence of statistical artifacts or measurement biases. Standard of living arguments face the same issues.

I mentioned the kinds of goods we consume in the first paragraph. We have large incentive problems built into healthcare, education, and government, all of which are growing faster than inflation and have been for decades. Tyler Cowen’s The Great Stagnation: How America Ate All The Low-Hanging Fruit of Modern History, Got Sick, and Will (Eventually) Feel Better discusses these issues. Cowen also says:

More and more, ‘production’—that word my fellow economists have been using for generations—has become interior to the human mind rather than set on a factory floor. Maybe a tweet doesn’t look like much, but its value lies in the mental dimension. We use Twitter, Facebook, MySpace, and other Web services to construct a complex meld of stories, images, and feelings in our minds. No single bit from the Web seems so weighty on its own, but the resulting blend is rich in joy, emotion, and suspense.

This might be overly utopian: consider the arguments of Sherry Turkle’s Together Alone or Nicholas Carr’s The Shallows, neither of which may be fully persuasive but which still give me pause about the Internet as a “resulting blend. . . rich in joy, emotion, and suspense.”

At least “Standard of Living Is in the Shadows” understands this: “The causes of income stagnation are varied and lack the political simplicity of calls to bring down the deficit or avert another Wall Street meltdown.” The Wall Street meltdown is also a symptom, not a cause, of underlying problems. This is also probably true:

Maybe the biggest reason for optimism is that there is still a strong argument that both globalization and automation help the economy in the long run. This argument remains popular with economists: Trade allows countries to specialize in what they do best, while technology creates opportunities to extend and improve life that never before existed.

Previous periods of rapid economic change also created problems that seemed to be permanent but were not. Neither the cotton gin nor the steam engine nor the automobile created mass unemployment.

I don’t pretend to have answers to these questions, but both major political want to sell easy and probably wrong answers. A critical mass of voters haven’t revolted, or won’t revolt. I don’t see the end game. But we may also get self-driving cars, 3-D printing, and human genetic modification in the next decade. All three are big, transformative technologies that may alter the fabric of human life in major and unforeseeable ways. Remember that a huge number of technologies diffused through society incredibly quickly during the depression (radio being the best known). In my own case, for example, Amazon, Barnes & Noble, and Apple’s digital reading devices have made self-publishing pragmatic in a way that it wasn’t prior to about 2010 or so, and that’s a pretty big win for me, given my experience with literary agents.

There does, however, seem to be a pervasive societal sense over the last four years that something has gone wrong.

In an e-mail, one friend said this: “These days, I feel like much of society is living in some sort of shared delusion, where people want what they want but are blithely unaware of the effects of their desires” in the context of a link to Branford Marsalis’ take on students today. Marsalis says that he’s learned that “students today are completely full of shit. [. . .] Much like the generation before them, the only thing they’re really interested in is you telling them how right they are and how good they are.” I said to my friend:

I suspect people have always been “living in some sort of shared delusion, where people want what they want but are blithely unaware of the effects of their desires,” but wealth has enabled us to indulge these desires and shared delusions in new ways. And “shared delusion” as a small and relatively unimportant percentage of GDP / government spending is a cheap, affordable thrill. But shared delusion in an environment where economic growth is weak—I tend to buy the Tyler Cowen argument espoused in The Great Stagnation, along with Peter Thiel’s addendums, though I’m more than willing to consider alternate points of view—is much harder. A lot of people are clawing for a bigger slice of a limited pie, which is a more substantial problem than a lot of people clawing for a sliver of a growing pie. Most people don’t even understand the problems, or try to genuinely understand; it’s easier to fit small pieces of complex problems and phenomena into an existing social / political worldview than it is to try getting a handle on the problem domain and the forces in play (most of the political posts I’ve seen on Facebook look like mood affiliation and simple, Haidt-style posturing and mood affiliation than anything else). The delusion isn’t new, but the large climate /environment has changed. The scale of the delusion has changed too, and scale has qualities of its own.

But I still wonder about something real: when someone makes it really rich (Astors, Vanderbilts, or, today, Gates, Ellison), there’s a tendency for the wealth and the kinds of behaviors that led to the major wealth in the first place to be diluted over time and across generations (think of Paris Hilton as a salient media example). I wonder if that also happens to some extent at the level of countries, but over centuries instead of decades. Most of the time I tend to guess not—the wealthiest countries in 1800 are still mostly the wealthiest countries today, with a couple of notable exceptions (Argentina has gone down, South Korea up)—but it’s still something I ponder. Changing wealth distributions play into this too, although I’m not really sure how.

The preceding paragraphs might be overly pessimistic. Let’s take the long view: things are actually pretty good. The Soviets aren’t threatening us with total annihilation (and vice-versa: the news that Kennedy seriously considered a first strike in the 60s is really scary), we’re not in the Great Depression, there’s still lots of cool stuff happening, books are cheaper than ever, and virtually everyone has a magic box that lets them communicate with almost anyone, anywhere, any time. The minutia and stupidity of politics is being enabled in new ways, but I think the basic content isn’t so different from the past. By virtually every metric people are better off today than they were 30 or 40 years ago (psychologically speaking, I’m not so sure, but we’ll leave that to the side). Anyone who has had medical treatment that wouldn’t have been possible 40 years ago is aware of this.

As I said above, we may also get self-driving cars, 3-D printing, and human genetic modification in the next decade. These technologies might be overhyped or not pan out. But I still think:

Pretty neat!

People who are well-equipped to take advantage of modern nutrition and communication are in an especially good position. People who fall into the defaults—lots of simple sugars and fast foods, four or five hours of TV of dubious value every day—might not be. Simply being a consumer might be getting harder. So is following default paths. Certainly I derive a huge amount of benefit from being part of modern communication networks, but the kind of person who doesn’t care that much about writing or artistic production or whatever might not care or benefit.

In Name of the Rose Adso thinks: “As I lay on my pallet, I concluded that my father should not have sent me out into the world, which was more complicated than I had thought. I was learning too many things” (179). But we can’t avoid getting sent out into the world. All we can do is hope we have or can develop the strength and fortitude necessary to make a go of it. Maybe the very wealthy, who have inherited wealth, can avoid much of the world, but that will only last for a generation or two, and then it’s back against the hard rock face of reality, whether we’re ready for it or not.

School, incidentally, does a poor job of presenting the rock face, which is another issue for another, but I think it’s possible to present that rock face without being a jerk about it. I try to do so.

I also try to remember that life is hard. Even when it’s beautiful.

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