A bunch of famous non-economists and obscure economists just wrote an open letter to Ben Bernanke to tell him ix nay on the antitative easing quay. I don’t have much of an opinion about this particular issue, but whenever I see a bunch of wingers cosigning something, I think of the Project for the New American Century. And whenever I think of PNAC, I think of the unabomber, Ted Kaczynski.
A few weeks ago, a friend of mine sent me an article about Ted Kaczynski. I liked the article but I thought its fundamental thesis — that Kaczynski became a terrorist because of weird stuff that happened to him in college — was misguided.
Ted Kacyznski lived in a cabin in Montana, wrote anti-industrial manifestos, and sent letter bombs to people. The PNAC signatories live in mcmansions in the suburbs of DC, write “pro-America” manifestos, and persuade the American military to bomb people. There’s not much difference — other than Kaczynski’s commitment to making the bombs himself — and I don’t see why Ted Kaczyinski’s teen years deserve any more scrutiny than Bill Kristol’s, Bill Bennett’s, and Francis Fukuyama’s do.
We live in a society where many people like to endorse murder and violence in the service of their own poorly thought-out philosophical principles. For some, it can be a lucrative career.
Mark S.
1. I thought it would be a little longer than 186 words.
2. Wow, what a who’s who of wingers and pseudo-intellectuals! Amity, Niall, Mr. Campbell Brown.
arguingwithsignposts
Very well put, DougJ. The fact that these people get their faces on TV constantly is proof of something. And it’s not good.
mikefromArlington
If the right wing, Greenspan and Caribou Barbie are against it, there must be something good about pushing our currencies value down.
General Stuck
We live in a country full of people who only care about their personal hell’s half acre, and who will help them buy the coolest toys they don’t need. The rest of the world is a reality show they watch on their big screen teevees.
DougJ
@mikefromArlington:
This is what I think too. I thought it (quantitative easing) might be a bad idea before, but now I’m pretty sure it’s a good idea.
El Cid
Krugman and Delong point out as well that there are real economists saying things that even Milton Friedman would dismiss. Because it’s about politics, not economics.
The Moar You Know
The only difference between a Bill Kristol and a Ted Kaczyinski is the suit and the amount in the bank account, although it could easily be argued that Kristol killed far more people.
And I say this as someone who personally knows one of Ted’s victims; he lived, but will never play the cello again. I think Ted deserves the chair for that.
I think Kristol and his PNAC buddies deserve far worse.
The Grand Panjandrum
So basically Ted Kaczynski just needed more friends in high places. Or maybe he should have done his killing on a far grander scale?
El Cid
@The Grand Panjandrum: ‘I rob a single ship, and you call me pirate; yet your armies steal entire nations, and they call you Emperor…’
DougJ
@The Grand Panjandrum:
Well, yes and no. No one in a high place would condone guerilla war — even on a small scale — against our awesome capitalist meritocracy.
But if he could have been convinced to send letter bombs to people within the Axis of Evil, he’d have his own cable show right now.
Linda Featheringill
WSJ article on the letter.
http://blogs.wsj.com/economics/2010/11/15/open-letter-to-ben-bernanke/tab/comments/
Article says what everybody else is saying, but the comments are interesting. Some of the commenters seem to be a bit wingnutty but others are intelligent.
geg6
@DougJ:
Count me in third. I was concerned about the dollar, but I am now aboard simply on the make up of the opposition. Whatever these guys say to do, just do the opposite and you can never go wrong. A law if nature, if you will.
Mark S.
Come on, people. You shouldn’t take the opposite position just because you don’t like the people arguing for it. Even these gang of idiots are like a stopped clock
Oh wait, I just remembered Bill Kristol signed, and he’s ALWAYS wrong. Never mind.
Lev
Kevin Drum had a great little post yesterday on how Palin actually drove the right-wing opposition to QE2. Maybe Reihan Salam will write a post about how this doesn’t prove that Palin is the real leader of the Republicans (especially considering that a handful of Repub Senators are already backing New START in defiance of the Mittster), but I don’t envy his task.
Martin
@El Cid: Certainly. We’ve got legislative intransigence on both raising taxes and proper stimulus spending – both of which can be used to shove the economy along, so the only thing left is monetary policy. To come out against that as well is essentially a confession that you want the economy to be fucked.
Mark S.
@El Cid:
This might have been the link you wanted. Friedmanism, Keynesianism, and now Palinism.
mikefromArlington
The U.S. Chamber of Commerce doesn’t want a weak dollar either. That’ll cut into the profits of U.S. companies as products built in this country become a bargain again and possibly bring back our working class workforce.
See, our wages were being dragged down very quickly to compete in the right wingers free market world, which was great for business that pay dues to the CoC. Cheap labor everywhere. A cheap dollar throws a wrench into their global jihad on the global work force.
For instance, this South Korea free trade agreement that Obama “failed” to get signed. Remember, this originally was drafted up during Bush’s reign of terror. Obama not selling out our labor with a crappy free trade agreement that would benefit business but not our workforce is somehow a failure.
Right wing Chamber of Commerce spin there. Even Donahue came out saying:
“Time is of the essence,” Donohue added. “American jobs are on the line. Since South Korea will soon implement a similar arrangement with the EU, American workers stand to lose 340,000 jobs without this agreement.”
When Donahue supports something, you can bet it means it’ll help lower U.S. labor standards and eventually lower our wages to help business’ bottom line.
I’m by far any sort of market economist so take what I say with a grain of salt but I highly doubt these right wingers give two craps about what’s good for our workforce.
Nylund
John Taylor (of Taylor Rule fame) and Douglas Holtz-Eakin are both “real” economists. A couple others have done some things of note. I met one at a conference a few years back (pre-crisis) who tried to convince me that there was no housing bubble and that the Case-Shiller Index was a BS ploy to make money by Case and Shiller. I didn’t buy it at the time and I think history has proven me right.
Davis X. Machina
The big foam “We’re #1” finger, having devoured the Federalist Papers, now chows down on The General Theory of Employment, Interest and Money.
Is there no stopping it? What will be its next target? Relativity: The Special and General Theory? The Protestant Ethic and the Spirit of Capitalism?
lacp
I’m curious how many of the signatories claiming to be at “Stanford University” are actually at the Hoover Institute. Not curious enough to waste my time finding out, though.
Ailuridae
@The Grand Panjandrum:
If Ted Kaczynski had grown up in the Upper East Side instead of Evergreen Park he would probably have been a pillar of society
Redshift
@Martin: I think it’s a mix. I think some of them want that (since the good of the country always comes second to whatever will help them gain power, and screwing up the economy bad enough that Democrats can’t fix it by the next election has worked wonders so far.) But I also think, in a tie-in to the “conservative intellectual” thread that I missed earlier, that we’re now well into the second and third generations who actually believe the BS that their parents were slinging.
If you take it as an article of faith that government action can never help the economy, only hinder it, then rejecting all the policies that could help the economy may mean you’re only willfully ignorant, rather than actively rooting for failure.
I wouldn’t want to try to sort them out into stupid and evil, though.
Sentient Puddle
@geg6: Meh, you shouldn’t worry about the dollar. There’s not a lot of risk of inflation as a result of quantitative easing at the moment, least of all over a “paltry” sum of $600 billion. If QE2 doesn’t work, the economic outlook is basically the same as it is today.
Nouriel Roubini laid it out pretty cleanly. It’s MV = PQ with V being exceedingly low, for those familiar with the equation. Or put in layman’s terms, the money currently out there isn’t getting spent, and that pushes against any possibility of inflation from an increase in the money supply.
Davis X. Machina
@Redshift: In other words, the cycle goes salt water economics, fresh water economics, and now holy water economics.
Redshift
@Davis X. Machina: LOL, exactly!
Lev
Doug, I think Sting (during his Police days) made basically the same point here: http://www.youtube.com/watch?v=kLG66ER0UUM
And didn’t Fukuyama renounce neoconservatism and support Obama in 2008? I seem to recall reading he did. Not exactly a true story of redemption, but it’s not like Kristol has had any publicly expressed second thoughts.
Mike Toreno
I still think QE is a bad idea, even though a bunch of crooks and idiots also oppose it. I don’t understand what good it’s supposed to do. It’s just dumping a load of money into banks, not injecting money into the economy. What will it do other than prop up the price of financial instruments in dollar terms, and also weaken the dollar, thus increasing the price of commodities?
fasteddie9318
@Lev:
Yes, Fukuyama may still be an asshole, but he parted company with Kristol and the like a while ago over Iraq. He still pushes the idea of exporting American values, but opposes the neocon desire to do it militarily. He started distancing himself from them in 2002, I think, and claimed he was going to vote for Kerry in 2004. He definitely endorsed Obama.
fasteddie9318
@Mike Toreno:
It will make bankers richer, right? Isn’t that always the ultimate goal?
Suffern Ace
@DougJ: Yep. I now think QE2 should be trebbled. Drive the value of $100 down to a dime.
Yutsano
@Suffern Ace: AWESOME! We could become the yen of the 21st Century!
I personally would love to see the dollar crater just to make the Chinese choke. When all of a sudden their labor market (which is halfway built on slavery anyway) becomes too expensive, watch the economic bullets fly. And India will join right up.
fuzz
Neocons are really just our own version of British victorian Imperialists. If you look at much of what they believe, from the complete absence of government oversight over the economy to the guerrilla wars abroad (always ostensibly for the good of the locals with only secondary benefit to the hegemonic power involved) and even the weird sexual hangups, they basically yearn for the post Spanish American war/pre ww1 America. A lot of these guys were just born a century too late.
suzanne
This is the most heartbreaking entry in the Arizona-is-really-fucking-stupid ongoing series.
Poor, poor puppeh, and her people. :(
Sock Puppet of the Great Satan
What FastEddie said. Fukuyama repented on the Iraq adventure in 2006:
http://www.huffingtonpost.com/arianna-huffington/repentance-update-ending-_b_19067.html
Evolved Deep Southerner
@arguingwithsignposts: I really have a hard time connecting quantitative easing with Ted K. – I tried, I really did – but I REALLY appreciate you turning me on to the Unabomber article. I’m halfway through it and really enjoying (well, not “enjoying” as in kicking-back-my-heels-and-laughing-like-hell enjoying it, but you know what I mean) it. What I knew of the man and the case was apparently the echo off the head of a toothpick as compared to reality. But isn’t it always thus about everything you look into closely?
Thanks for the link. Otherwise, up with quantitative easing, for all the reasons mentioned above; if that many stupid people are agin’ it, it must be good. I know this sounds like a primitive foundation upon which to build one’s opinionational house, but, hey. In this day and age, it’s about as solid as one gets, no?
EDIT: awsp, I don’t know why I responded to you here. My response was to DougJ’s original post. Sorry. Carry on.
Martin
@Mike Toreno:
Well, it’s taking US bonds off the table. It’s not dumping money into the banks, though they’ll benefit from the lower rates, which in theory they’ll pass on to businesses to borrow at lower rates.
The other benefit is that it’ll increase the price of imports (not just commodities). The hope is that will drive up demand for domestic production, both domestically and internationally (since our exports will be cheaper). Higher commodity and import prices also means that domestic labor is comparatively cheaper. That’s why payroll tax holidays work fairly well – they make lowish-wage labor quite a bit cheaper.
I’m already seeing the effect of QE2 on profit estimates for this quarter. That’s the real opposition to it – it’ll cut into profits, which cuts into stock performance. Of course, stock performance mainly helps the rich. How many of those signatories have large stock portfolios? All of them? Take away profits and companies actually need to DO something to keep the juice going. Doing something requires hiring and investment.
This is all pretty weak sauce, but it’s the only thing the economy really has going for it. It’s not great, but it’s not nothing. Mostly, its desperate, for lack of a legislative solution.
Evolved Deep Southerner
@suzanne: Yes. But could the commenters on that dog’s untimely death be more stupid?
pattonbt
See this comment section is a prime example of why D’s always lose the message war. So many of us want to say “well, if those nutjobs who are always wrong are for it, then I’m against it”. And then we D’s come down from that impulsa and say “well, I can’t actually say that and there is merit X to proposal Y even if potential negative outcome Z is there….” and so on. And then we argue and bicker and get pissy because we want some if it, but not all of it and we get nervy with each other while we try to compromise (not that that is what is going on with this thread per se).
We really want to govern and try and make things better and we are willing to take some bad with the good. And we won’t throw out ideas from idiots “just because”.
Yet the R’s will without hesitation. As a matter of course, the R’s will throw out the perfect if liberals support it, end of story. It’s easy being Republican.
Yutsano
@Evolved Deep Southerner: Not going there. Dealt with enough Arizona idiocy in my life. Wish my friend would move back to Washington, even after she got married.
freelancer
Is there a way I can make good by shorting shame futures? Seriously. Nothing is taboo anymore in terms of policy initiatives, except compassion.
Evolved Deep Southerner
@pattonbt: If you sat next to some dumb fucker who you KNEW would tank on the SAT – call him or her the absolute bottom-percentile Joe/Josephine Bloggs – and you had the opportunity to cheat off of their exam …
Ah, hell. Throwing out ideas “from idiots” seems about as reliable a guide as any in this climate. If we could shoot down half the trial balloons these dumb fuckers are floating nowadays, then you and me can talk “nuance.”
srv
Dougie, Americans live in McMansion slums. PNAC folk do a bit better than that.
Rather than navel gazing about the economy, how about some thoughts on how Congress can gin up a joint resolution pushing Obama to attack Iran?
Martin
@Yutsano: Well, don’t count out the Chinese too soon. They and India are actually developing a decent sized consumer class. It’s small in % terms of their population, but it’s pretty fucking huge in raw numbers.
Those countries are heading toward being larger markets for goods than the US and Europe. Now, almost all of the low-end manufacturing is taking place there, but some of the high-end stuff, engineering and support structure (marketing, finance, etc.) is happening here. It’s a questionable trade, but given that I don’t see any parents eagerly pushing their kids into minimum wage iPhone assembly line jobs, I don’t think Americans really want to swap places with China here.
Our real market is innovation, management, all that stuff, and we’re really starting to fuck that up by draining the educational pool. That’s one of our biggest imports, and we’re slowly losing that edge.
Martin
@srv: You don’t think $3B in stealth fighters to Israel if a 2 state solution develops isn’t close enough?
morzer
@mikefromArlington:
Yes- it reduces the price of American exports and so ought to lead to more exports, thus more production and more jobs. Compared to this basic economic truth, the yapping about weakening the dollar is either a) nonsense peddled by the terminally ignorant or b) an attempt by the rich to maintain their ill-gotten gains at full value even as America suffers 10% unemployment.
pattonbt
@Evolved Deep Southerner:
Nuance will never be bought. I love it and am willing to engage in it, but without big dumb sloganeering, its dead to the populace. But I am about at the point, wait, no, I have been at the point (personally) for a long time that throwing out their ideas the second they are uttered is the appropriate response.
One thing that always gets me, as someone who was more than adamantly opposed to the Iraq war from the PNAC sales days, is how those, like Fukuyama, who pimped the war endlessly (or even those who tepidly supported it or voted for it), is how they are ever taken seriously again in anything in life. I mean, if you screw up going to war and thousands of people die for nothing, shouldnt your judgement be suspect and ridiculed on everything for the rest of your life. I mean screwing up the daily check book is one thing, but screwing up on that level should have you banished forever.
srv
@Martin: If we can be sure of anything, the F-35 won’t be ready for any conflict in the next decade or so.
But there have been rumors an ally got a batch of “retired” F-117’s.
morzer
@Yutsano:
If the dollar actually craters, government borrowing will become unsustainable, because the interest rates will spike brutally. It’s tempting to imagine that China might suffer most, but the fallout here would be remarkably unpleasant too. That’s why the US doesn’t dare to radically devalue the currency uniliaterally, even though it would help exports considerably.
Yutsano
@Martin: If you consider that China has twice as many dirt poor folks as we have PEOPLE, you see what the burgeoning wealth inequalities are really getting them. Similar story with India, and both have nukes. If either country doesn’t address these issues and fast, they’re going to eventually blow up, and it won’t be pretty.
And I know that the Chinese don’t want American style democracy. Anyone who thinks so is a self-deluded idiot. What they DO want (and what we still do pretty damn well even after the Dubya interregnum) is their government to act on their best interests in consumer protection and fundamental legal fairness. That will kill the Chinese worse than the American economy evaporating overnight.
Uncle Clarence Thomas
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For others, it can mean the Presidency of the United States of America.
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Martin
@srv: Decade or two, huh? Well, maybe Obama is more realistic on the prospects of a 2 state solution than we thought.
Yutsano
@Uncle Clarence Thomas: You were cuter when you pretended to make sense.
morzer
@Yutsano:
Historically, China has always had massive wealth inequality, as well as being the dominant economic force for centuries. There’s nothing new in the masses being poor and rural – in fact, what’s changed has been a general rise in access to new possibilities of generating wealth, coupled with a fierce nationalism. If anything, the general level of economic welfare has risen in the last ten years, even in the countryside. You now have genuine mass literacy, better access to healthcare, better transport and infrastructure. Yes, China has problems ecologically and socially, but while the economy continues to move along nicely, as it has for almost two decades now, it’s unlikely that any sort of radical movement will pose a serious threat to the regime, which, in any case, has the PLA strongly behind it.
Uncle Clarence Thomas
@Yutsano:
.
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It’s too bad you failed to back up your evidence-free assertion while delivering yet another generic balloonbagger turd-for-brains “insult” which hurt no one’s feelings.
Next time, please enlist the Head Monkey to assist you.
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morzer
@Uncle Clarence Thomas:
The former half-term governor in name only is busy, but I can pass a message to Commissar Limbaugh if you like.
arguingwithsignposts
@Uncle Clarence Thomas:
yes, George W. Bush does come to mind.
Yutsano
@Uncle Clarence Thomas: I repeat:
morzer
@Yutsano:
Give it 19 years and his wife will call you suggesting you apologize.
J. Michael Neal
There’s a second side to this for the Chinese. They have tied the value of the renminbi to the dollar. If the US engages in large scale monetary easing with the consequence of weakening the dollar, the Chinese have two choices. The one everybody has focused on so far is dropping the peg and letting the renminbi substantially appreciate relative to the dollar. That would cause relative costs to escalate in China and weaken their export built economy. The problem for the Chinese is that they need that growth.
Morzer is correct that living standards have improved even in the rural areas, but that’s a result of increased productivity (still very low) in agricultural production. As has happened everywhere at this stage of rural development, that increased productivity is pushing people off the land. They can’t be employed in the sector. So, they have to move to the cities in order to get a job. If the Chinese economy doesn’t continue to grow at a ridiculous rate, they won’t find jobs. That has the potential to lead to serious unrest. The estimates are that the Chinese economy needs to grow at around 8% just to keep up with this influx.
So, the Chinese are very angry at this prospect. That’s not surprising, but the simple fact is that, if they are going to continue to grow at the necessary rates, they are simply going to have to find another way to do so.
Of course, they have another option. They could simply decide to maintain the peg and keep buying all of the dollars necessary to do so. This would eliminate the risk of our interest rates on government debt from spiking, since the Chinese would have to provide the demand.
There’s a problem here, too. By pegging the renminbi to the dollar, the Chinese have outsourced their monetary policy to the Fed. No matter whether the Chinese economy needs loosening or tightening, Ben Bernanke is the chairman of the group that makes that decision.
Right now, the last thing the Chinese economy needs is large scale loosening. If they maintain the peg in the face of such a policy, their costs relative to the US will remain stable. All they’ll have done, though, is trade that stability for internal inflation. Unlike the US, China isn’t facing deflation. Their economic statistics are hard to decipher, but it certainly looks like they are already facing serious monetary pressure. If they explode their money supply in order to maintain the peg, inflation may well ignite like a rocket.
That’s the potential dilemma they face, and when they complain about QE2, what they are really saying is that they don’t want us to force them to make that decision. I’m fresh out of sympathy for them on this one. If you’re going to hook your monetary policy to someone else’s, don’t start crying when you get an inappropriate monetary policy. It’s not the Fed’s job to take labor market conditions in China into its mandate.
The funny thing is that the Chinese policy is, in a large part, a reaction to the succession of global financial crises in the 1990s. What’s amusing about it is that they don’t seem to have grasped the actual underlying problems. They made the same mistake a number of Latin American countries did in the 80s and 90s: tying the value of their currency to the dollar. They were blinded by the fact that those crises were caused in the other direction: the dollar strengthened, giving those countries a monetary that was inappropriately tight. Well, they avoided that issue, but the fact that they used the same tool to get opposite results has still come back and bit them.
Mnemosyne
@Uncle Clarence Thomas:
What’s “evidence free” about pointing out that you dropped a non sequitur?
Apes can read philosophy, they just don’t understand it.
morzer
Not quite true. Rural areas are increasingly moving into small/medium scale production of consumer goods, and have done for nearly two decades now. If you go to the villages, you’ll find that there are plenty of small-scale family operations manufacturing things like cheap socks, knitwear etc, or recycling (in a loose sense) old materials/metals etc, or simply producing bricks. I’ve seen huge piles of socks in village yards just waiting for the buyers to come from the nearest town or city. It’s true that there is a traditional Chinese pattern of floating populations of workers moving to the cities, and both the Ming and Qing dynasties tried to legislate people into remaining where they were as the cities boomed, however, to assume that all productivity rises are produced by and in the cities is simply not accurate.
It would be more realistic to point out that China has its own rustbelt, mostly in the North, where the old state industries that supplied the traditional “iron ricebowl” were located. When the free market reforms came in, those industries were simply tossed on the scrapheap, or sold off cheaply, leading to massive, and abrupt, unemployment in those regions. New industrial opportunities have soaked up some of the discarded workers, and some of the floating population have been taken on by the new city-based plants, but China has always had a fairly large population of rootless workers and dispossessed peasants.
The trick China is trying to pull off is two-fold – to maintain standards of living for the newly prosperous, as well as to keep the jobs market healthy. Both are affected by the value of their currency. Obviously, inflation is one part of the equation, especially since China remembers vividly the terrifying inflation of the thirties and forties under the Guomindang. Any serious threat of inflation may annihilate those hard-won savings (and the Chinese tend to save at a much higher rate than Americans), and that would be very bad news for social stability. Equally, if the dollar weakens enough to make Chinese exports more expensive, factories will close, workers will be laid off, and the new prosperity will start to unravel.
It is somewhat unfair to blame China for using the spendthrift folly of successive US governments to its advantage, especially when they are genuinely trying to maintain prosperity for so many people who have recently emerged from terrible poverty. Sure, they are self-interested – but the results of their self-interest compare rather well with the results of ours.
PeakVT
I don’t see why Ted Kaczyinski’s teen years deserve any more scrutiny than Bill Kristol’s, Bill Bennett’s, and Francis Fukuyama’s do.
Not to defend any of them, but unlike Kaczyinski, the PNACers have encouraged socially acceptable forms of death and destruction. War is collective stupidity, but it remains popular with a large percentage of humans. Kaczyinski, OTOH, did something way outside accepted norms, so the backstory is more interesting.
Jim Pharo
Kaczyinski didn’t just have some stuff happen to him in college. He was the victim of outrageously cruel and inhuman psych experiments over the course of his undergrad years. From the Wiki:
“He also participated in a multiple-year personality study conducted by Dr. Henry Murray, an expert on stress interviews.[8] Students in Murray’s Central Intelligence Agency (CIA)-sponsored study were told they would be debating personal philosophy with a fellow student.[9] Instead they were subjected to a “purposely brutalizing psychological experiment” stress test, which was an extremely stressful, personal, and prolonged psychological attack. During the test, students were taken into a room, strapped into a chair and connected to electrodes that monitored their physiological reactions, while facing bright lights and a two-way mirror. Each student had previously written an essay detailing their personal beliefs and aspirations: the essays were turned over to an anonymous attorney, who would enter the room and individually belittle each strapped-down student based in part on the disclosures they had made. This was filmed, and students’ expressions of impotent rage were played back to them several times later in the study. According to author Alston Chase, Kaczynski’s records from that period suggest he was emotionally stable when the study began. Kaczynski’s lawyers attributed some of his emotional instability and dislike of mind control to his participation in this study. Indeed, some have suggested that this experience may have been instrumental in Kaczynski’s future actions.”
chopper
@Sentient Puddle:
for now. V is very low, but it can change. i think the big fears of inflation come from pumping up the money supply only to watch V start to rise again and inflation starts moving up fast.
at least interest rates are very low which gives the fed the opportunity to tamp it down a bit. all in all they’d rather see moderate inflation than any real deflation at all.
Max
I scanned the linked Chase article on Kaczynski; I, too, found it an interesting read. While providing a lot of context, the 2000 piece had little to offer on Kaczynski’s personal experience in the experiment.
Radiolab had an interview with Alton Chase about the Kacynski and the Murray experiment in which he offered more specifics. The episode is entitled “Oops,” and the Chase interview runs from 5:25 to 13:00.
http://www.radiolab.org/2010/jun/28/
chopper
@morzer:
tanking the dollar will piss the hell out of the countries that buy most of our bonds, which will have a much bigger effect on government borrowing than interest rates i would imagine.
and yes, it would certainly be at least in part done as a nudge to get the chinese to actually float the yuan.
it would be interesting to see the fed and the government actually attempt to devalue the dollar under some manner of control – say, devalue it by half and use higher interest rates to stabilize it at that point (lol, good luck riding that tiger). the national debt would be back under control, and maybe new bond buyers would find the high rates lucrative. current bond owners would declare war tho, and the SS trust fund would take a huge shit.
Luzeelu
Kaczyinski tidbit:
I worked with a woman several years ago who had played with him as a young child. Their parents had been friends. She recalled that he was aggressive and would hit her. (They were perhaps 5 years old.) She never had much use for him, but he apparently kept in touch with her parents for many years.
ThatLeftTurnInABQ
@morzer:
This is a very important political point. Hyperinflation did more to destroy the KMT in the 1940s than the PLA did.
And it can’t have escaped the notice of the CCP leadership that rising levels of inequality in wealth and income driven by an economic boom centered on the southeastern coastal regions but not shared in the poorer and drier interior provinces are associated with the declining stages of a traditional dynasty. In Chinese history new dynasties tend to be spawned in the poorer and more nomadic north and/or west, engage in land reform and a more general leveling in their early years, migrate the center of political and economic power south and/or east while becoming richer and more mercantile over time, and die of the socio-economic equivalent of gout. The CCP is doing an excellent job of replicating this pattern – but for the sake of terminological convenience they should move the formal capital to Shanghai so we can start referring to the northern- and southern- periods of the Red dynasty.
Shinobi
I know this thread is super old, (16 hours is old? oh internet…) but I just watched this great/tragic/hilarious/rage enducing video explaining quantitative easing.
“Is this some kind of nightmare? I want to bang my head against the wall.”
Even the computer generated voice sounds incredulous.