Concerning the Heartland

Young man wrapped American flag crop field sunsetOne of the notes that the dog whistle of the Trump political machine hits is rural parochialism and provincialism, a conviction of the inhabitants of the American “heartland” that it is the essential America.

America hardly invented pitchfork-wielding country chauvinism, but it has had a particularly powerful historical current of that kind of know-nothingism, owing to its roots in a medley of dispossessed immigrant political minorities—especially religious minorities. There is ample lore in the heritage to support the popular psychological metaphor of taking a nihilistic wrecking ball to the state. There’s burning the corrupt edifice to the ground, nuking it from orbit, methodically strangling it with “starve the beast” spending legislation, “draining the swamp”—whatever form it takes.

These people don’t want to hear about big city folk and their reputedly elite cosmopolitan problems. No, it is we, on this two-lane road in the middle of southern nowhere, amidst the vestigial shells of Rust Belt industry, in the bucolic crop fields of South Dakota, who are the “real” America! It’s time to take it back! We don’t need no stinking foreigners, we couldn’t give a hoot about “diversity”, and (as was remarked to me recently) come on, show us one legit immigrant from Yemen, we dare you.

As always, the problem is that going full ostrich doesn’t work.

Like it or not, we do live in a highly globalised, interdependent world. Interdependence means complexity, and—to return to thermodynamics, as we all someday do—complexity means fragility. Fragility means that diplomacy and a multilateral approach to human affairs are necessary. Omaha mostly buys Samsung smartphones, too. Banks in Kansas are exposed to the Hong Kong Dollar and the German stock market. There are Caterpillar excavators and Boeing airplanes everywhere, and the manuals are translated into two dozen languages. Ohioans entrust their very lives to talented Japanese embedded software engineers every day, and will again tomorrow and the day after that—isn’t it nice to plug one’s ears and not have to wonder why one’s Honda doesn’t spontaneously explode or run off the road? The working-class enlisted sons of Kentucky are shipped off to places their parents would do well to learn to pronounce. The more economically privileged ones are going to discover a good Jordanian immigrant-owned falafel stand in their college towns.

(My own tech career was launched at a small-town Internet service provider owned by a Syrian Arab and his Pakistani business partner. But everyone knows devout Muslims don’t create jobs in Murrica.)

Or, more cosmologically: events in Yemen, Somalia, Egypt, South Korea, China and India, inter alia, are highly relevant to every American’s existence.

I know a lot of people who would prefer not to venture beyond the county line and like their intellectual preoccupations as they like their beer—domestic. To you I say:

Sorry, you can’t put the milk back in the cow and rewind the clock to 1802 A.D.1

Moreover, without the Coastal Mind Control Elites, this iconic heartland would have neither the government subsidies on which it extensively relies, nor markets for its products. I won’t patronise you with one of the many charts showing the geographic distribution of net inflows and outflows of federal dollars and the rural-urban trade balance. Y’all are actually pretty good at Google when there’s pervasive liberal bias and insidious Soros funding to be unearthed on the Internet, or some Julius Streicher Breitbart screed in need of scholarly citation.

Big conurbations concentrate economic opportunities and institutions. You don’t have to live in them if you don’t want to, and you don’t have to take part in the so-called Knowledge Work economy, but you can’t just give it all a sociopolitical middle finger and pretend that they, their denizens, or the larger world don’t exist. You guys just want to rap about how you’re screwed by globalisation and immigration, drop the mic, and leave hard problems of making the world turn ignored and unsolved. It’s facile, it’s petulant, and it makes you sound like an overgrown toddler

If that’s how it’s going to be, fine, but could you at least let the overedumacated, book-learned cityfolk do their jobs instead of sticking them with a reality TV demagogue and his diabolical alt-right posse?

1 This is precisely why the [seemingly] intentional deafness of the Libertarian candidates to foreign policy is a non-starter.


The Very Moderate Libertarian

It’s time to succinctly define a Very Moderate Libertarian, or centrist Libertarian-leaning position, or whatever you want to call it. That’s the one I hold.

By nature, it’s not very well-represented by the more extreme Libertarian Party, but it’s definitely not a mainstream Democrat/Republican viewpoint either.

1. As a starting point: many of the structural criticisms of the corrupt, lobbyist-dominated, incumbent two-party political system aired by the Libertarian Party and by the Bernie Sanders wing alike are valid and deserve serious action.

The continuation of the Demoblican-Republicrat status quo and the rent-seeking Guilded Age that is upon us is the worst possible option.

1b. Another starting point: the US has some unique features that give it an exceptional economic dynamism relative to many of its developed-world counterparts, and there are no free-lunch solutions which can only capture the upside of this while removing the downside. In particular, wealth inequality is a byproduct of innovation and prosperity in an advanced, specialised society, and it’s here to stay. It’s not government’s job to fix it, nor is it a problem that in and of itself needs fixing.

2. No strong religion on how to fix healthcare, other than that what we’ve got now is the worst possible option, regardless of whether one goes the single-payer/state route or the free-market route.

This was true before the ACA (“Obamacare”), and it’s mostly true after the ACA too. No strong religion on whether the ACA was good or bad. It has done some good things, to be sure. But fundamentally, strong conviction that it moved some pieces around without fundamentally fixing any problems (if only because the most salient points were watered down by Republicans).  When legislation is sufficiently watered down as to be ineffectual, yet still costly, the solution is not generally to “ram it through anyway”.

The structural forces that support inflation in the healthcare sector are still there, and the obese midsection of the industry—insurers, malpractice lawyers, billing consultants, computer experts, hospital administrators, marketers, etc.—is still assured a disproportionate share of healthcare spending. It’s disproportionate in the sense that the market would rationalise it away if healthcare were nakedly exposed to the prices the market will bear. This same overhead would be trimmed by strict cost controls in a state-operated system. Both approaches have their drawbacks. The one thing the soft-libertarian knows for sure is that what we have now is a pessimal, worst-of-all-worlds approach.

3. Socially liberal by default, but open-minded and receptive to intelligently expressed concerns about unintended sociological consequences of most dogmas, including dogmatic social liberalism.

Religious critiques need not apply; religion has no place in public policy. The Constitution says so.

4. In favour of modest, competent, incremental public administration proposals, and highly allergic to grandiose initiatives and sweeping overhauls, particularly costly ones.

This applies equally to expensive, ambitious Moonshots as well as to ill-considered ideas to totally dismantle or disestablish big parts of government overnight without thinking through the consequences.

5. All other things being equal, free trade and globalisation are good things. Even if they’re not good things, they are unavoidable things.

But not all things are always equal. Of particular concern are the supra-national “accountability” structures that often created as a side effect of free trade agreements. These generally benefit private corporations seeking to trump local control (e.g. community opposition to environmental contamination) and jurisdiction (e.g. limiting ability of locals to sue foreign corporations in local courts for the very real damage they sometimes cause).

That said, global economic integration is certifiably unstoppable. Fighting it with neo-Peronist protectionist measures is stupid and ineffective. Efforts to halt or defer the “creative destruction” of dying industries for which politicians are inexplicably nostalgic (e.g. industrial manufacturing) are also pointless boondoggles.

While at first glance this sounds like a very Libertarian thing to say, this recognition runs counter to some Libertarian precepts as well. We live in an interconnected and interdependent world, and complexity of this nature increases fragility. There is no running away from the fact that we have to work and cooperate with other nations and trading partners within the logic of increasingly global structures. This goes against the inward-looking assertions of “sovereignty” of which Libertarians are sometimes fond (the Brexit mindset). In that respect, globalisation is like any bargain; you must give in order to take.

6. It’s not up to government to create jobs.

The public sector is, of course, a rather large employer, but it should never be a policy to create more jobs there than are truly necessary in order to serve some larger social objective of full employment.

A certain amount of Keynesian-style short-term countercyclical economic stimulus may be acceptable, but is discouraged and is a measure of last resort, not a tool to be wielded liberally at the first sign of a contraction or possible recession. If the GDP is only going to grow by 0.5% this quarter instead of 1.2% as promised, it’s not government’s job to swoop in and fix that by misappropriating taxpayer funds.

In general, government does not create jobs nor solve unemployment. There is no such thing as a “jobs bill”. By and large, the private economy creates jobs. Long-run societal employment comes from the health of the private sector. Misconceptions about this are widespread and very costly.

It’s also not up to government to provide re-training for the structurally unemployed. Unfortunate as it may be when middle-aged people have fallen out of the bottom of industrial employment after spending much of their life there, government cannot effectively provide them a new career or valuable skills given the specialisations demanded in our modern era. It’s a throwback to the days when relatively homogenous manual and industrial work was a growth industry. These days, it’s little more than a waste of taxpayer dollars.

7. Private-sector corruption is a very real and very serious problem, too.

To be clear, government should not be a default solution to all problems, but willfully blinding ourselves to the fact that large corporations accumulate power and use it for private gain is not the way, either.

Dogmatically blaming government for everything while holding up the private sector as the very picture of virtuous economic agency (which unfortunately Libertarians are apt to do) is misguided and dangerous. Neither are incorruptible, and neither are inherently free of pathology inherent in large organisations and bureaucracies.

8. Certain things need to be state-operated and/or state-funded, whether for reasons of natural monopoly, economies of scale, susceptibility to private corruption against the public interest, or some other valid reason. This includes fire and police, roads, public schools, transport, and defence. There is room for valid debate as to what the others are.

Public schools deserve emphasis in particular: it is integral to the function of every modern, developed economy to have a universally literate citizenry educated to certain minimum standards, no matter how mediocrely that outcome is sometimes delivered. School choice is a valid aspiration in the public discourse, but not at the expense of guaranteed universal education.

On the other hand, there is no question that our public sector is too large, too expensive, too inefficient, and often ineffective. It performs many functions that government really ought not to do, and sucks up a significant amount of tax dollars into costly boondoggles that reduce to an economic net negative.

9. A certain amount of social safety net is reasonable, and probably a requirement for the stability of any modern economy and democracy.

However, ours is outsized relative to the societal benefits it provides; other developed countries may pay even more for their social programmes, but they also get a whole lot more, pro rata. Our “welfare” (TANF) system sucks; it is limited, genuinely helps relatively few recipients out of poverty, yet costs a lot for something that doesn’t work well. Our food subsidy system (SNAP/EBT) is necessary in some form, but “SNAP benefits cost $74.1 billion in fiscal year 2014 and supplied roughly 46.5 million Americans with an average of $125.35 for each person per month in food assistance” (Wikipedia), and that’s not a cost-effective solution. $74.1bn isn’t that much, but it’s too much when spread across 46.5 million people.

Asking how we can more effectively cover more people with more food stamps is starting from the wrong end of the issue. The first question we need to ask is why there are 46.5 million people receiving SNAP when our total labour force is about 160 million (Sep 2016), and how we can empower the economy to address the larger structural issues that lead to this.

With the gutting of old welfare (AFDC) under Clinton, Social Security supplemental disability benefits have become the new “welfare”, for those able to get them (in some cases in increasingly creative ways). Medicare and the VA are barred from negotiating drug prices by Bush-era law (aka a handout to Big Pharma). There are countless more examples of perverse incentives and naked corruption throughout our social welfare programmes. To be sure, some of these are overblown and mythologised by conservative demagogues, but some of them are very real.

The real problem with social welfare programmes is not that they exist at all—at least, not from the soft-libertarian vantage point for which I advocate here. The objection is more to the lukewarm results. This stuff costs way too much and does too little for American people genuinely in need. Other developed countries’ citizens get a lot more for their tax Dollar and Euro. It needs to be reformed to be more streamlined and targeted to achieve real results. This doesn’t necessarily mean putting yet more screws to the poor, but rather better management, administration and cost control on the supply side. Big programmes may need to be split into more targeted and effective ones that solve specific problems better.

Some entitlement programmes are most likely largely ineffective, and need to be done away with. That may cause some short-term pain, and we should be prepared to endure it. On the other hand, some programmes may need to be funded more to be truly effective, and to some extent, that’s okay too, provided that the increased effectiveness is real and demonstrable, not just a handout to populist pressure or pandering to the proletariat.

10. Home ownership, college enrollment, and easy-credit expansionism should not be government policy objectives.

Top-down credit expansionism does nothing but create inflation and asset bubbles, and attract barnacles (e.g. for-profit diploma mills) to exploit it. The only reason 60% of US students have government-guaranteed student loans is because college is so expensive, and the reason it’s so expensive to begin with is because it evolved to exploit the widespread availability of student loans. The same dynamic is present in housing and real estate.

We need to return to fundamentals and bring these sectors down to earth, where they can only charge what the market will directly bear. This will cause serious pain and dislocation for the vast sectors of the economy (investment banks, lawyers, well-paid professional bureaucrats and administrators, etc.) that have evolved to exploit this teat, but they need to be weaned off through aggressive and decisive policy shifts.

11. US global interventionist foreign policy and military adventurism must be sharply curtailed.

But this should be done carefully and with realistic awareness of the fact that much of the US’s economic preeminence is tied to its global empire apparatus and the geostrategic configuration of the post-WWII environment.

It would be naive to think that we can simply withdraw troops and pursue the commonly disseminated Libertarian fairy tale of a strictly defensive, isolationist foreign policy. We are globally involved whether we like it or not, and if we abdicate that position, other actors will move in to take our place, including actors whose accession to greater global power can have very non-benign consequences, including for us. The one thing we can be absolutely sure of is that a sudden power vacuum will not bring about a beneficent pax postamericana.

At the same time, we are not the “indispensable nation”, and we don’t send our military to defend human rights or depose evil dictators. These are filthy lies we tell kids in Civics for Peasants 101. We’re totally fine with human misery and love evil dictators—when they do what we want.

Thus, while we should absolutely pull back from our more fruitless military adventures, we should recognise that we didn’t start them because we just love military adventures. Geopolitical logic is a complex, dark and cynical subject, and, rather worrisomely, it appears to be beyond the grasp of the current crop of Libertarian candidates.

At the very least, if we scale back our global military involvement, we should be prepared to make some hard sacrifices in the area of energy security and prices. This doesn’t just mean minor inconveniences at the gas pump; US GDP is very closely correlated with Vehicle-Miles Travelled. Energy is a deadly serious subject for the US economy and even for the US’s continued existence. The current crop of inward-focused, domestic policy-oriented Libertarian candidates doesn’t appear to have the pragmatism to acknowledge that. What happens abroad is highly relevant to the heartland. The year is not 1634. (Actually, it was pretty important then, too.)

12. Devolution back to the state level isn’t necessarily the way to go.

In a sharp break with Libertarian folk tradition, I don’t think the Very Moderate Libertarian should be a dogmatic states rights-ist.

Certainly, the federal government has undoubtedly usurped a lot of power over the years. And the intention of the Framers that states compete to enact the most favourable legislative and economic climates to attract residents and build prosperity is one to keep in mind at all times.

However, in the interest of simplification, streamlining and greater cost-effectiveness, the US has a lot of work to do in improving its appreciation of the concept of economies of scale. We needlessly duplicate all sorts of public administration, judicial, law enforcement and revenue structures at the municipal, county, state and federal level. A lot of our infrastructure and regulations languish in a costly morass owing precisely to the fact that we have 50 jurisdictions.

A lot of things that need to be centralised up to the federal level so that we can stop paying the enormous costs of having 50 ever-so-slightly different copies of them for no reason. When it comes to liberty, sometimes one has to be cruel to be kind; the most liberal outcome is not necessarily the one that leads to a Byzantine, morbidly obese and chaotic power structure in which it’s impossible to get anything done because everybody’s got to have their little fiefdom.

My home state of Georgia has 159 counties, second only to Texas’s 254 (and Texas is 4.5 times larger). Why does Georgia have 159 counties? This does not strike me as a positive manifestation of the virtues of liberty-loving local governance, but rather wasteful and dysfunctional bureaucracy that obstructs economic and political activity.

13. We over-regulate, but the private sector can’t be counted on to magically do the right thing.

We have a monstrously overcomplicated regulatory environment which drags down economic dynamism while frequently prosecuting the wrong things for the wrong reasons, and this is badly in need of simplification, streamlining and reform. (Part of the reason that’s so is explained in the previous point.) As the meme goes, everyone commits three felonies every day, and that’s not something we should look upon with indifference.

However, there are many examples of market failure, where private actors reliably do the wrong thing. The most classic examples of this involve the costs of negative externalities and short-term thinking not being priced in. However, there are others. So, from the fact that we regulate many things badly does not follow that we should not regulate anything, ever. Quite a few things need to be regulated. Do you really want to see the return to 1900s-era pharmacies, full of quack remedies and patent medicines, with only Consumer Reports as your guide to whether they’ll kill or help you? In the name of “freedom”? I don’t.

14. Liberal approach to immigration, but with a healthy dose of realism.

Our immigration policy is badly in need of reform, particularly the part that creates obstacles to legal immigration for productive, skilled and/or educated people who would be net-positive contributors to our economy and our society.

Furthermore, there’s no question that security concerns about refugees and the ever-present menace of “terrorism” are exaggerated demagoguery from populists pandering to a xenophobic underclass.

At the same time, to listen to some Libertarians one would have it that the doors should simply swing open. In an ideal world, perhaps. In our non-ideal world, no developed country can sustain a totally unbridled influx of unskilled economic migrants—not so long as that country has public infrastructure and services upon which those people make demands, anyway.

Immigration should be liberalised in a way that is actively guided by healthy national priorities. What kind of immigrants do we most want? Those are the kind that we should optimise the immigration system to most easily allow. Our present system does not do this, as evidenced by complaints from many captains of industry.

15. No strong religion on gun control.

The right to bear arms is enshrined in the Constitution and should be fundamentally conserved in some fashion.

We can also agree that the causes of widespread gun violence in the US run a lot deeper than mere widespread availability of firearms. There are other countries where private firearms ownership is common or ubiquitous, and they don’t deliver rates of carnage remotely in the vicinity of ours. Furthermore, we can agree that many gun control proposals are ineffective and costly boondoggles.

From this it does not follow that firearms ownership should be trivial or unrestricted. Background checks and licencing are reasonable measures so long as they are effective in doing what they set out to do (which means, they keep most people who should not have guns from having guns most of the time, not that they provide an airtight lid which determined criminals cannot pry open) and do not fundamentally infringe on the right to bear arms for the average citizen.

From this it also does not follow that all classes of firearms should be available to anyone who wants them. Constitution or no Constitution, Farmer Johnson doesn’t need grenades, mortars or artillery cannons, and I cannot conceive of good reasons why this should be legally possible.

16. Mass incarceration, zero-strikes laws, draconian sentencing = awful.

No explanation needed, really. Our rate of incarceration is absolutely unconscienable, and our highly politicised, get-tough-on-crime, law-and-order sentencing has ratcheted out of control in the last few decades.

To emerge from these medieval Dark Ages, which see a paramilitarisation of our police force, an enormous law enforcement bureaucracy that lives off of tens of billions in federal War on Drugs dollars, and even widespread criminalisation of consensual teenage sexual activity in unintended ways, all this needs to undergo a serious Renaissance, and it couldn’t possibly happen soon enough. We shouldn’t have to live in a country where talking to the police is so overwhelmingly dangerous that you would be a fool to utter a single word.

17. The tax code is Byzantine and excessive, and our taxation structures are too complicated

No strong religion on whether overall rates of taxation need to be reduced, whether the income tax should be replaced with a consumption tax, and whether the IRS need be simply “abolished”; that depends on many other things, and cannot simply be made as a blanket statement. All other things being equal, lower taxes and a more competitive economic environment are good aspirations.

What is most important is modernisation and simplification. Much of the Internal Revenue Code has not been updated since the 1970s, and does not take into account the increasingly global ways in which business is done, as evidenced by the sheer number of offshore tax loopholes available for those wealthy enough to avail themselves. The tax code does not accommodate the increasingly digital, nomadic and intangible ways in which we do business, either. This is a constant vexation to those of us in the tech industry who have to fill out tax returns clearly intended more for shoe factories than for online marketing agencies or software development companies. All this puts us at a significant competitive disadvantage.

What’s more, the Internal Revenue Code is insanely complicated, and hundreds of billions of dollars are sucked out of the economy annually for the costs of complying with that complexity. That’s little more than a handout to the accountancy and tax preparation sectors, and those sectors have lobbied mightily to ensure that filing taxes remains complicated and onerous.

Furthermore, we have a bewildering array of taxation sources in the US: federal payroll taxes, federal income taxes, state income taxes, (in some places) municipal income taxes, state sales taxes, county sales taxes, county property taxes, excise taxes, gasoline taxes, vehicle taxes, import duties—far too many kinds of taxes. Add them all up, and it becomes clear that in the aggregate, the average middle-class American taxpayer pays not much less than the average Western European, while receiving a lot less in return. This fundamental inefficiency is concealed in a dozen different ways in which we pay taxes, and deserves illumination. The soft-libertarian’s primary concern is not that taxation exists, but rather effectiveness and return on tax dollars paid. Why should we pay so much to get so little?

Finally, the US should end its fundamental conceit in taxing the worldwide income of its citizens regardless of where they reside and where it is earned, and should instead adopt taxation policies on this that are more in line with those of other developed nations. Some people will doubtless take advantage of a residency-oriented taxation scheme, but any tax scheme will be exploited by someone, somewhere. It’s still the right thing to do.

18. The environment doesn’t protect itself.

By its nature, and despite the claims of economists and their theories, it’s abundantly clear that the private sector thinks about short-term returns and doesn’t much care for longitudinal issues. The problem of negative environmental externalities is also widely understood.

For these reasons, sustainable development is an issue within the purview of government to guide. The focus should be on removing artificial subsidies that sustain our addiction to hydrocarbon fuels and on removing artificial subsidies and points of law which maintain automobile-oriented infrastructure and build more roads and highways even when that’s not what the population wants. Obstacles to the development of renewable energy should be removed and the private sector should be allowed to do its work in this area liberally. There are huge economic returns in store for the winners of that technology and commercialisation race if it is allowed to happen on a level playing field—a playing field not tilted by state collusion with Big Oil.

There is a certain category of environmentally positive infrastructure investment, such as mass transit, which is probably up to government to make because few private actors are interested in such a long and uncertain payback. That’s okay. Done right, these projects are far from being money sinks. They enable economic development and dynamism, and this can be seen all around the world in cities that have good transit networks. One could hardly argue that the Shanghai or Berlin metros are a drag on those cities’ economic growth.

I do not generally see much fruit in policies focused primarily on capping emissions. Libertarianism of any sort is a fundamentally optimistic intuition about the capacity of the private sector to solve problems if given the opportunity. In the case of the environment, it may take an extra nudge and incentives to get private actors to take the long view and work on renewables, recycling, reprocessing, repurposing and less polluting infrastructure—but that’s okay.

It is also okay for the government to step in to prevent perverse outcomes and Tragedies of the Commons in newer areas, such as the negative consequences of hydraulic fracking that are beginning to emerge.

However, whenever possible, government should get out of the way and let the market work out solutions. Government is fond of committees and agencies for the sake of having committees and agencies, and when it comes to the environment, as with other things discussed in this article, the primary focus should be on limiting these to where they are truly effective.

 19. And finally, something we can agree on with even far-right Libertarians, I think: it’s not government’s job to fix all problems.

A large category of things in life simply fall into the category of “shit happens”. Some of them government can and should fix. From this it does not follow, however, that for everything that could conceivably go wrong, there should be a government agency to oversee it, a district attorney to prosecute it, or even tort law to permit suing over it for huge sums.

We’ve seen the development of a litigation and regulation-happy society to a degree where the transaction costs and overhead of doing just about anything are greatly increased. It’s just parasitic drag, and only the lawyers win.


Questioning my relationship with The Daily Show

I am rather deeply disenchanted with and bored of The Daily Show. This has two distinct, unrelated causes I can identify:

1) One simply gets too old to tolerate its dick-and-fart jokes and potty humour. At this point in my life, I’m looking for more incisive, more subtle and less superficial political satire and social critique.

I don’t know if that problem has a solution, given that the Daily Show’s seeming target is college-aged audiences. But I find myself wishing that, in terms of sophistication, it would graduate along with the early-mid 2000s students who were the engine of its ascent.

2) Trevor Noah is a fantastic and brilliant comedian—if you watch his stand-up from South Africa and the UK.

His gift for accents and languages is uncanny, and his satire of the South African political elite (e.g. Julius Malema, Jacob Zuma) and everyday interactions had me doubling over from the stomach pain of laughter. Watch his old material; if you don’t know much about South Africa, you’ll learn.

Some of my favourite examples on YouTube (always subject to removal, you know how YouTube is) include his treatments of airport terminal announcementsthe inclusion of Chinese in the BEE (Black Economic Empowerment) programme, and this rather obscure act poking fun at the frustration of interactions with Johannesburg City Power. And his performances about cultural differences in America need no introduction at this point.

Since that was my first contact with him, that’s how I see the real Trevor Noah. At The Daily Show, I have the acute sense that he’s not being allowed to carry his artistic identity over. He’s being shoehorned into an American dick-and-fart comedian role, and to say that it’s not a natural fit for him is an epic understatement.

I understand that the logic of the show has to have some continuity with Jon Stewart and with the show’s historical inertia, audience and so forth, but he’s not Jon Stewart, and he shouldn’t be.

To really reap the rewards of Trevor Noah as an artist, an observer and a commentator, he must be allowed to be his “South African” self and to bring—perhaps it would be more apt to say, to impose—a distinctly foreign perspective to his American audience, nolens volens.

It might not be what the focus groups tell Viacom executives would sell, but there’s real potential there. Yes, there’s always the spectre of Piers Morgan, and with his demise, the idea that foreign commentators interpreting American affairs and telling Americans how things should be is a fatally unpopular formula. However, I think—perhaps naively and overoptimistically—that the younger and more malleable viewership of the Daily Show would respond better than that of CNN’s, and would have a greater inclination to stretch their brains and grapple with such a phenomenon.

I cringe when I see Trevor forced into various contrivances and artifices of a false pretense of American mass-cultural familiarity. He’s not American, and he shouldn’t be made to pretend as if he is. Low-brow toilet humour and American Millennial lore doesn’t work for him. Laundering facile Internet memes is not his competency. If he could control more of his material and delivery, and tailor it to his traditional style, there would be a show more worth watching.


Hard lessons in my twenties

My twenties are coming to a close in a few days. Like many people in my position, I got to thinking: “What do I really wish I had known when I was twenty?”

I suppose I could recapitulate professional and business lessons in easily digestible form, but does the tech entrepreneur self-help genre really need my help to survive? I could write about the evolution of my politico-philosophical positions, but I do that already. When I think about the kinds of insights I most wish I had when I was twenty, I think about the harder pills to swallow–the ones in the world of life, love and people. So, I’m going to talk about those.

It’s not that age thirty is a snow-capped summit of shareable wisdom–no, indeed, one of the lessons from my twenties is how little I truly know. But another thing I’ve learned acutely in my twenties is that the road can end abruptly at any time, so if you want to write down some thoughts, don’t wait until you’re seventy and retired to write memoirs. It’s a cruel trade-off, because at seventy you’ll have a lot more credibility. But you may not get the chance to employ it.

Not all these thoughts originate in my direct experience. Some do, and I’ll own that. Some I’d rather disavow so as to not look like an idiot; you know, “asking for a friend” here. Some others are from observing the lives and fates of those close by, particularly where their experiences are more diverse. The ambiguity I’ve created here lets me steal a bit of their thunder and make my twenties potentially seem more interesting and original–or catastrophic–than they were.

And so:

1. The biggest advantage of youth is youth.

You only get:

  • Bright-eyed, bushy-tailed excitement
  • Huge amounts of physical and mental energy
  • Low maintenance and high risk tolerance

once, and if you don’t use them, they’re gone forever. You’re never getting them back.

I’m going to frame this in tech entrepreneurship terms because that’s close to home, but it applies equally well to any hard endeavours: launching a substantive career, getting a doctorate, doing significant research, writing a book, opening a shop, becoming an expert.

We often talk about “working smarter” versus “working harder”, and surely, working smarter is an important evolution. But to attach to the value chain in the first place, there’s a lot to be said for working harder. Sometimes there’s just no substitute for raw hustle. The cruel reality is that not everything can run on “vision” and “management”; someone’s got to be down in the boiler room, and some problems can only be tackled with huge inputs of raw energy, high motivation and brute force.

When I was twenty, I could write code for twelve hours in a dark room without a care in the world. Nowadays, I’d say two to three hours is a banner day, and I might need a mental break tomorrow. If nothing else, my eyes and limbs can’t take it; I’ve got all sorts of little aches and pains I didn’t used to have.

Much is made of “a lifetime of learning”, and that’s good and fine, but the reality is that most of us do become more sclerotic with age and our habits become more ingrained. We get intellectually fatigued from seeing the same patterns over and over. We get physically tired.

From a competitive standpoint, it’s really hard to kill a “Ramen-profitable” 23 year-old rooming cheaply with some buddies. At that age and life situation, one needs almost nothing to survive. What’s the worst that could happen? He could fail completely and move back in with his parents for a while? A businessman like that is like a cockroach; you could drop an atomic bomb on him and he’d still be kicking. In contrast, a guy with two kids, a mortgage, daycare, medical bills and wifely lifestyle expectations is a sitting duck with a massive burn rate. If his income stalls below six figures, he’s going to have to quit and do something else.

Now that it’s become sociologically normal to view one’s twenties as an extension of high school, many folks let their twenties go to waste. I pissed away my twenties, too. I started my company at age 22, but by that point I managed to buy a downtown condo, incurring two mortgages and a car payment. That high minimal personal expense base doomed me to spinning my wheels for years on consulting in order to stay afloat when I should have been building product–effectively, the same kind of funding constraints as the 40 year-old guy with a family. And I didn’t hustle nearly as hard as I should have; I wasted a lot of time and money with stupid distractions.

Yeah, I’ve got some kind of “work smarter” play in motion, but the point is that I’m not getting my 22 year-old self back. If you’re lucky enough to still be in your early twenties, recognise that your time is now, and the world is your oyster. You may not have the wisdom and experience of older folk, but you’ve got 200,000 lbs of thrust and tiny gross tonnage; that’ll get you to space, if you really want to go. Stop watching Celebrity Apprentice and go do something real. You’ll never have the same opportunity again.

2. It’s important to build a real identity.

It’s relatively commonplace nowadays to see people in their twenties wile away some of their most socially formative and interactively significant years on an exterior of “ironic” or sarcastic hipsterism, or veil themselves in thick shrouds of pop culture inside jokes, movie references, or Internet memes. That’s about the only kind of conversation you can have with them.

The appeal is easy to understand; it’s lazy as can be, requiring little personal ethos and cultural literacy (of the non-pop culture sort), and only moderate brain candlepower. More importantly, it’s risk-free, since anything one says in this insincere mode of social operation is easily disavowed or denied. As Christy Wampole said in the excellent article Living Without Irony:

… irony functions as a kind of credit card you never have to pay back. In other words, the hipster can frivolously invest in sham social capital without ever paying back one sincere dime. He doesn’t own anything he possesses.

Social capital is a game where one must pay to play. If you bring nothing to the table, you get nothing. Despite their occasional short-lived hit singles, the full-time “ironic” and “absurdist” are utterly discardable, forgettable people. When their black day arrives, nobody will come to their funeral, because they impressed nothing upon anyone worth remembering. Hopefully relieved of the naive invincibility of late teenage years, it’s time to give some thought to what would be said at your eulogy and written on your tombstone if you died tomorrow. Do you want your immortal contribution to the world to be that you had a kitschy hat, a snarky one-liner, or a Lolcat for every occasion?

To build real relationships, to learn and to grow, you’ve got to do the hard work of growing intellectual and moral backbone, and you’ve got to learn to defend it while negotiating bridges of understanding with others. It requires putting yourself out there and making yourself vulnerable. It requires applying yourself toward a directed purpose, an ongoing project of who you want to be when you grow up.

3. The pervasive current of truth about most of humanity is a conservative one — and that’s okay.

You can pick up on this most easily by observing the habits and lifestyles of white middle-class liberals in the US. You’ll notice they mostly have rather conventional and morally upright marriages, and aim to raise rather morally upright and conventionally successful children. Officially, they’ll pay much lip service to morally relativistic fashions and postmodern eclecticism, but that mostly concerns other people’s rights, not their own lives. Consider where they choose to live, which schools they send their children to, and the positions they take in zoning forums. Sure, they’re all for recognition of non-cisgendered non-binary pansexual genderbenderqueer whatever, but watch their reaction when their son comes home in drag and says he’s screwing a black guy.

In general, even these people tend toward those who are sociologically similar. They can be notionally against the death penalty, but not when it’s their sister’s murderer. They’re against militaristic foreign policy until someone flies a plane into their office tower. They’re against militarisation of police and martial authority until their neighbourhood is overrun by vagrant looters. They’re enthusiastically for affirmative action and equal opportunity policies to rectify historical racial inequity until a busload of Hispanic gangbangers is unloaded into their kids’ AP Calculus class.

They’re not hypocrites. They’re just trying harder than most to keep the politically correct cat in the bag, because that’s their shtick. But occasionally, fissures form in this elaborate fiction, and if you peek in and look around, you’ll see that they’re normal people, after all. There are some earnest progressives among the progressive–mostly unreconstructed flower children and their confused descendants. But when it comes to things like family morality, sexual mores and sociocultural dilution, most liberals agitate for rainbow causes on the implicit theory that other people can “live and let live”. While other people deal with the consequences, liberals trumpet their progressive, tolerant values without their own skin in the game, and everyone walks away happy. This is great news for people living at the margins who used to be actively persecuted and just want to be left alone, but it can give a very wrong idea about what people think privately.

Still, in our highly individualistic and politically correct age, it’s comme il faut in all but the most parochial circles to belch out at least a nominal paean to social liberalism–that is, unless you want to taint yourself with some kind of retrograde Republicanism and its populist dog whistle, conservative Christianity. This leads to the misapprehension that most of people are quite liberal, but it’s a siren song. Taking it at face value in one’s twenties means ignoring the realities of people’s private judgement, and it can lead to some harsh consequences.

One area is friendship and reputation. I’ve lost good friends over some unhealthy lifestyle choices in my mid-twenties which telegraphed flimsy constitution and poor impulse control. It’s one of those things where everyone is superficially very tolerant and accepting–democratic live-and-let-live and all this–but one day I woke up and realised that, while they do speak to me, they’re not really my friends anymore.

It’s astoundingly easy to fling yourself clear out of respectable society if you don’t see past the veneer of tolerance–if you actually allow yourself to believe that people don’t believe in respectable society anymore. I don’t know what’s worse, falling for that scam or never having been taught that there’s such a thing as respectable society. The latter is the stuff of bad education from unreconstructed sixties hippies, who never quite got over their sentimental attachment to the idea of disestablishing the whole thing. It’s poetic, but it sets up your children for failure.

“Don’t judge me!” is a facile bit of sloganeering, a thumb-sucking fantasy. Of course people will judge you! Judgment about others’ character is part of the basic inductive reasoning integral to our species’ survival. We live in a socially and morally interdependent universe, and the painstakingly evolved mechanics of social cohesion and shared morality–the stuff of anthropology–predate the latest fads and nouveau projects in sociology by what, a few millenia?

The consequences of my actions in this area are entirely mine to own and live with. I wish I could go back and give myself a blunt reminder that the world works more like my parents and other elders said it does, and less like the ostensibly freewheeling Bacchanalia of mass-culture would have us believe.

Also, because I’ve seen it happen to others around me: sleeping around for both genders robs them of valuable experience and skills of relationship-building, since sloppy, drunk sex requires none of them. I’ve seen far too many peers come out of a Lost Decade like that with no capacity to relate to another human being. It’s common for twenty-somethings to conflate quantity and quality in talking about the much-prized “life experience”. A decade on heroin is knowledge, but not good or useful knowledge.

4. The quality of the people with whom you surround yourself is of paramount importance.

One of the fallacies of the Anglo-American penchant for individualism is that it is given to paint one’s journey through life as that of a free electron, associating incidentally with various atoms from time to time in a kind of undifferentiated way. This is amplified by the American national mythos of the socially mobile, implicitly classless society, as well as the value of “diverse experiences” to “broaden horizons”.

If there’s one thing I’ve learned from my twenties, it’s that this is a grand, epic lie. Life experience is good, but not all diverse experiences are worth having, and not all horizons need to be broadened. We are social animals, and we adapt to those around us. It follows from this that if you surround yourself with bad people, they will slowly pull you down to their level, no matter how clever you are. Your choice of friends and partners is a powerful signal to other people whose opinion is important to you, just like anything else. There’s no judgement-free zone.

To advance through life productively, it is important to take a page from the social rules of the Old World and acknowledge the existence of social strata and concepts like “level of cultural development”; your friends and your loved ones must embody the values in which you would like to commune. If you aim to conserve a cultured upbringing, you must be around cultured people. If you would like to live a healthy life, you must do it with healthy people.

I’ve also come to appreciate that shared values are the single most strongly indicated prerequisite for a successful marriage or long-term relationship. When I was younger, I would have said that the most important thing is intellectual parity and intelligence. This is not exactly correct; a couple with disparate intellects but with a wide base of common inner-cultural understandings and unspoken agreements on what’s important, right and wrong will be a lot more durable than two brilliant people who are what you might call “civilisationally incommensurable”. It just happens that common values among intelligent people tend to necessitate common intelligence; if education, literacy, and higher-order self-actualisation are important values for both of you, it will logically come to pass that you will get together only if you’re both smart.

The iceberg to watch out for here for is falling out of the bottom. This is easier to do in a large, highly individualistic society largely bereft of traditional drip pans. You’re free to fall through the cracks, and in the name of official tolerance, everyone will let you. However, as I said in #3, your fellow human beings aren’t actually as fluid, bendable and tolerant as the brochure advertises.

I said above: “It’s astoundingly easy to fling yourself clear out of respectable society if you don’t see past the veneer of tolerance…” The meaning here is that if you lose your connection to the people who are truly important to you and let the aspects of life you most value slip through your fingers, it may be hard to get them back.

Here, too, the folk American sociology tells some lies: people are forever saying it’s easy to make a fresh start. Perhaps. But while the world is large, the parts of it in which you’d want to hold membership are much smaller. They talk. The most important lesson of all in my twenties is that this culture wants for a resurrection of the pedagogical primacy that used to be placed on the concepts of reputation, word, pride and dignity. If someone had informed me that most of the world still believes in these things, I would have made rather different choices, as would–hopefully–many of my peers.


On “communication skills” and pedagogy

Here’s a pet peeve: the widespread belief that any two people, regardless of the disparity in their levels of intellectual development, are destined to fruitfully converse, as long as both exhibit “good communication skills”.

First, acknowledgment where it’s due. It is indeed an important life skill to be able to break down complex ideas and make them accessible to nonspecialists.

“If you can’t explain it simply, you don’t understand it well enough” is a remark on this subject often attributed to Einstein (though, as I gather, apocryphally). The idea is that explaining something simply in ways anyone can understand is the sign of true mastery of a subject, because only deep knowledge can allow you adroitly navigate up and down the levels of abstraction required to do so.

Those of us in the business world also know about the importance of connecting with diverse personalities–customers, managers, coworkers. In the startup economy, there’s a well-known art of the “elevator pitch”, wherein a nontrivial business model can be packaged into ten-second soundbites that can hold a harried investor’s attention–the given being that investors have the attention spans of an ADHD-afflicted chipmunk.

I would also concur with those who have observed that scholarly interests which don’t lend themselves to ready explanation–that are “too complex” for most mortals to fathom–are often the refuge of academic impostors. There are a lot of unscrupulous careerists and political operators in academia, more interested in what is politely termed “prestige” than in advancement of their discipline and of human understanding. These shysters, along with more innocent (but complicit) graduate students caught up in the pressures of the “publish or perish” economy, are the spammers of house journals, conferences and research publications, often hiding behind the shield of “well, you see, it’s really complicated”. Most legitimate scholarly endeavours can be explained quite straightforwardly, if hardly comprehensively. Complexity is an inscrutable fortress and a conversation-stopper in which people more interested in being cited and operating “schools of thought” (of which they are the headmasters, naturally) hide from accountability for scholarly merit.

All this has been polished into the more general meme that productive interaction is simply a question of “learning to communicate”. With the right effort, anyone can communicate usefully with anyone. It doesn’t matter if someone is speaking from a position of education and intelligence to someone bereft of those gifts. Any failure to achieve necessary and sufficient understanding is postulated as a failure of communication skills, perhaps even social graces (e.g. the stereotypical nerdling).

This is an extreme conclusion fraught with peril. We should tread carefully least we impale ourselves on the hidden obstacles of our boundless cultural enthusiasm for simplification.

First, there’s a critical distinction between clarity and simplicity. It is quite possible to take an idea simple at heart and meander around it circuitously, taking a scenic journey full of extraneous details. Admittedly, technologists such as programmers can be especially bad about this; their explanations are often vacillatory, uncommitted to any particular level of abstraction or scope, and full of tangents about implementation details which fascinate them immeasurably but are fully lost on their audience. I’ve been guilty of that on more than a few occasions.

However, there is an intellectually destructive alchemy by which the virtues of clarity and succinctness become transformed into the requirement of brevity. Not all concepts are easily reducible or lend themselves to pithy sloganeering–not without considerable trade-offs in intellectual honesty. This is a point lost on marketers and political activists alike. It leads to big ideas and grandiose proclamations that trample well-considered, moderate positions, as the latter are thermodynamically outmatched by simplistic reductions. Brandolini’s Law, or the Bullshit Asymmetry Principle, states: “The amount of energy needed to refute bullshit is an order of magnitude bigger than to produce it.” As always, sex sells–a fact of which the TEDdies have a firm grasp, with their peddling of seductive insight porn. As Evgeny Morov said:

Brevity may be the soul of wit, or of lingerie, but it is not the soul of analysis. The TED ideal of thought is the ideal of the “takeaway”—the shrinkage of thought for people too busy to think.”

Second, the idea that “communication skills” are at the heart of all matters has wormed its way into pedagogy rather disturbingly in the form of group work and so-called collaborative models of learning. As the thinking goes, the diversity of a student body is an asset; students have much to learn from each other, not just the lecturer, and encouraging them to do so prepares them for “the real world”, where they’re ostensibly going to be coworkers, police officer and arrestee, and so on.

It reminds me of an episode recounted by my favourite author William Blum in his memoir about the political upheaval of the 1960s:

At one point I enrolled for a class in Spanish at the so-called Free University of Washington, and at the first meeting I was flabbergasted to hear the “teacher” announce that he probably didn’t know much more Spanish than the students. And that’s the way it should be, he informed us–no authoritarian hierarchy. He wanted to learn from us as much as we wanted to learn from him.”

The counterculture kids were challenging incumbent hierarchies of authority. I see the same kind of anti-intellectualism recycled today into the putatively more laudable goal of social flattening.

But there’s a limit to the productive fruit of such ventures. It’s best illustrated by an anecdote from my own life.

When I was a freshman at the University of Georgia, I took an obligatory writing and composition course, as part of the infamous “core requirements” (remedial high school) that characterise the first year or two of four-year undergraduate university education in the US. One day in November, our drafts of an expository essay were due, presumably for commentary and feedback on writing mechanics by the English graduate student teaching the course.

Instead, we were paired with a random classmate and told to critique each other’s papers. My partner was an Agriculture major–a farmer’s son, he readily volunteered–who was only at the university because his father insisted that he needed a college degree before taking up his place in the family business. I would estimate his reading level to have been somewhere in the neighbourhood of fifth to eighth grade. I was going to critique his paper, and he was going to critique mine.

Candidly, his paper was largely unintelligible gibberish; it would have taken many improbable megajoules of energy input much for it to rise merely to the level of “unpolished”. Were the problems strictly mechanical–paragraphs lacking topic sentences, no discernible thesis in sight, no clear evidentiary relationship between his central claims and the sentences supporting them–I would have earned my keep in a few minutes with a red pen.

The problem was much deeper: his ideas were fundamentally low-quality, benighted in a commonsensically evident kind of way. They were at once trite, obvious, and all but irrelevant to the assigned topic. The few empirical claims made ranged from startling falsehoods to profoundly unfalsifiable arrangements of New Agey words that grated on the ear of someone accustomed to the idea that the purpose of arranging words was to convey meaning. He was hurtling at light speed toward an F. What could I do, rewrite his paper for him? How would I even begin to explain what is wrong with it? There was no room to start small or to evolve toward bigger, more summative problem statements; it was a genuine can of worms: pry it open, and all the worms come out to play at once.

I don’t mean to impugn him as a human being; he just wasn’t suited to the university’s humanities wing, whose business was reputed to be the life of the mind, set in a programme of liberal education. He didn’t know how to argue or how to write — period. He was more of a hero of proletarian labour, as it were, reared in a life script ineffably different to my own, never having crossed paths with me or anyone else in the pampered, effete, bourgeois “knowledge work” setting before, and destined to never cross paths with me in any such setting again. I was utterly paralysed; there just wasn’t much I could do to help him. Plainly, I couldn’t tell him that his thoughts issue forth from a nexus of civilisation unrecognisable to me. There wasn’t much of anything to say, really. I made a few perfunctory remarks and called it a day.

His feedback on my paper, which in turn suffered from organisational and topic transition problems that continue to dog my writing today, was: “Looks good, man!” Verily, his piercing insight knew no bounds. We really learned a lot from each other that day. Along the way, I overheard bits and pieces of a rather erudite peer review by a considerably better-educated classmate. Why couldn’t she review my paper? It would have almost certainly helped. My writing wasn’t stellar, and my devoted readership–I do it all for you, much love!–knows it still isn’t.

Later, I privately enquired to the lecturer as to how I was supposed to condense a lifetime–however hampered by the limitations of my age and experience–of literacy, intellectual curiosity, familial and cultural academic background, semi-decent public education and informal training in polemic and rhetoric into a functional critique that would realistically benefit my beleaguered cohort and help him write a better paper. She replied: “That was the whole point; you need to work on your communication skills.”

In defiance not only of the comme il faut tenets of political correctness, but in fact–in some sense–of the national mythos of our putatively classless and democratic melting pot, I brazenly suggest something that is, I think, considered fairly obvious elsewhere: not all categories of people are destined to communicate deeply or productively.

When such discord inevitably manifests, we should not reflexively blame so-called communication skills or processes. People operate in silos that are sometimes “civilisationally incommensurable”, as it were, and sometimes there just isn’t much to communicate. This is the reality of culture, class and education, and the thinking on collaborative learning and teaching methodologies should incorporate that awareness instead of unavailingly denying it. Matching partners in group activities by sociological and educational extraction clearly presents political challenges in the modern classroom, though. Instead, I would encourage teachers to rediscover–“reimagine” is the appropriate neologism, isn’t it?–the tired, hackneyed premise of leadership by example. At the risk of a little methodological authoritarianism and a few droopy eyelids, perhaps the best way to ensure that students leave your course better than you found them is to focus on their communication with you. They’ll have the rest of their lives to figure out how to transact with each other.


Predictions for 2015

It is challenging to make prognostications that are specific and testable, or, in the thinking of Karl Popper’s brand of empiricism, falsifiable. Many predictions are formulated such that they could be argued, post facto, to be true regardless of what actually happens.

I’ll try to avoid making those. At the same time, prognoses about complex phenomena like global economics and war are often, by their nature, vague and open to interpretation, and they consist of many parts. They are replete with statements about things that aren’t necessarily discrete or quantifiable. At best, they can be viewed as compositions, as systems of many interdependent propositions and variables which must be accepted or dismissed holistically. This is the insight of Thomas Kuhn, who found the Popperian view of how science evolves, through the testing of individual hypotheses, to be naive. He popularised the use of the word “paradigm”, a superset of a hypothesis. It may be that the apparent truth or falsehood of my predictions will depend on whether you buy into certain paradigms.

Without further ado:

1. The price of crude oil will rebound to US $80/bbl or more.

It’s not in the interest of any oil-producing nation to perpetuate the current freefall, which has led, at the time of this writing, to oil trading in the $50-$60/bbl range .

I’m not an industry analyst, but my impression is that the current slide is caused by a combination of:

  • Reduced short-term global demand.
  • Saudi Arabia breaking ranks with its OPEC cohorts and refusing to restrict output.
  • Optimism about the increasing production of the American domestic energy sector (leading to expectations of higher supplies).

I don’t think Saudi Arabia going rogue is going to last. Saudi Arabia can weather low prices better than many rival oil autocracies, but ultimately, these states have common interests. Someone will probably make a deal with the Kingdom to encourage them to return to cartel discipline. The Russian economy suffers particularly heavily from a fall in oil, as its state budget depends almost entirely on high oil price targets, and it exports almost nothing apart from energy and raw materials. It’s possible that Russia, despite not being an OPEC member state, will offer some carrots to get the Saudis to cut output.

As for the optimism about American domestic energy supplies, there’s definitely an underlying reality: undeniably, output has increased profoundly in the last few years, to the extent that it may be one of the most significant structural changes of the early 21st century. But I would wager that some of the correspondent market movements can be attributed to irrational exuberance and speculative trading, too; once the sizzling party cools down and the fast rave music gives way to slower ballads, cracks will emerge, in the form of concerns about sustainability of yields (at certain EROEIs) and environmental impact of this boom. I don’t believe that short-term advances in hydraulic fracturing of shale change the big picture, which is that the EROEI of global hydrocarbon energy supplies is falling.

I hope that the current trend in increasing energy capture efficiency (and therefore EROEI) of photovoltaic cells and wind turbines, as well as ongoing research into hydrogen fuel cells, thorium reactors, and other alternative sources, will continue undistracted by short-term fossil fuel supply bumps. I’m not holding my breath for capital markets to get smart enough to emphasise long-term prospectus over short-term speculative opportunities, though. I’ve always thought that energy and environmental issues are key examples of market failure, alongside healthcare.

2. Russia will continue to be mildly depressed.

Most of Russia’s present economic malaise and inflation (50% devaluation of the rouble) probably owes itself more to the crash in crude oil prices than to any effect of Western sanctions, in the same way that Russia’s stabilisation in the 2000s owes itself to the rise in crude oil prices rather than Putin’s much-touted economic policies.

So, I think any recovery is likely to be linked to the oil. As I expect the gains in crude to be modest (to ~$80/bbl or so, rather than $100+), I don’t expect Russia to see a dramatic reversal in its current fortunes.

3. The Ukraine conflict will stagnate, unresolved.

There is neither political commitment nor opportunity for either the West or Russia to, as outside influences, drive the Ukraine conflict to any endgame. The only actor that has an incentive to take decisive action and definitively consolidate Ukraine is the Kiev government, but it does not have the military capability or finances to do that.

What I expect is that the current status quo will coalesce into a kind of uneasy détente, not wholly unlike the aftermath of the Georgian-Russian conflict of 2008, where South Ossetia and Abkhazia became nominally independent and de facto Russian-controlled–and, at the very least, ungovernable for Georgia. This kind of situation has a tendency to ossify over time, unless some dramatic transpiration suddenly reanimates active conflict.

That is to say, the Russian-adhering Eastern Ukraine will continue to be a semi-ungovernable patchwork for the central government. Professional ‘rebels’ from the likes of the Donetsk People’s Republic will continue to carve out careers for themselves, and be variously, depending on what’s going on, nudged by half-hearted Ukranian army offensives, officially disavowed by Russia, or unofficially utilised by Russia as a tool to coerce Ukraine and the West (with the implicit threat of whipping up pro-Russian nationalist agitation among such groups). More generally, Eastern Ukraine will continue to run nominally as part of Ukranian territory, but with its fronds tending increasingly toward the Russian sun in terms of economic and political linkage.

This situation will, over time, reach some sort of equilibrium where nobody really “wins”, while everybody claims to have won and trades accusations of banditry. The world will forget about Ukraine and move on; Russian economic relations with the West will slowly and subtly renormalise, particularly with Europe, though the remnants of sanctions will continue to be used by the US to pressure Russia, while the instability of the East–with the implied influence that Russia has over it–will be used by Russia as leverage against the West. Both the US and Russia win in having an outside enemy to refer to, particularly the Putin regime, which will point to US sanctions as easy blame for ongoing internal malaise it cannot fix.

4. US-Iran relations will improve and the US will ease sanctions against Iran.

While some recent improvements in US-Iran relations can probably be attributed to the ascendance of more moderate post-Ahmadinejad forces, the more significant incentive for collaboration involves the common enemy of ISIS. It is likely that there will be some quiet, underplayed horse-trading and compromise regarding Iran’s nuclear programme in the service of this awkward alliance.

5. The ISIS-driven partition of Iraq will solidify.

With increasing US commitment to airstrikes against ISIS, which is also perceived as a regional threat by nearly all incumbent regimes, it seems likely that ISIS military gains will be arrested. On the other hand, another US ground war to decisively drive ISIS out of the territories they currently occupy does not seem politically possible.

This will probably lead to a hardening of existing boundaries between ISIS-controlled and non-ISIS-controlled Iraq. Small flare-ups will occur between ISIS and local governments who have more enthusiasm for driving them out decisively than the US does, such as the battle-hardened Peshmerga of Iraqi Kurdistan, though they will not succeed in doing so for lack of supplies and firepower. Other locals will probably come to an accommodation with ISIS, though this is something neither side will publicise because doing so is a losing proposition PR-wise (failure to defeat ISIS on one side, failure to comprehensively consolidate an Islamic caliphate on the other side).

6. The Syrian Civil War will continue without resolution or settlement.

This war will continue and inflict even more destruction upon an already destroyed and war-weary country.

In all likelihood, however, it will come to be increasingly simplified down to a pro vs. anti-ISIS conflict, especially since the American view is that any enemy of hard-line Islamists is its friend. Depending on the overall military successes of ISIS in Iraq and Syria, this may even lead to a delicate, understated thawing or rapprochement with the Assad regime, though neither side will publicise this fact because it’s a lose-lose PR proposition.

7. Chinese (PRC) growth will continue to plateau.

As China undergoes industrialisation without a clear next step beyond its specialisation in manufacturing, its GDP growth will continue to plateau. Combined with a possible pop in its overheated urban real estate market, this may lead to a mild recession.

8. China will become an increasingly attractive IT outsourcing destination over India.

As a result of its growth and increasing (though very unequally distributed) affluence, India has become too expensive for many Western firms’ tastes, and they will increasingly look to China to fill the gap, particularly in low-skill business process outsourcing and backoffice functions. But this in itself is unlikely to be China’s ticket out of a looming existential crisis of macroeconomic purpose.

9. The West African Ebola epidemic will peak and fade from public view.

The West African Ebola epidemic is currently projected to peak in April or May of 2015 by the WHO. After that, it will probably fade from public view entirely, punctuated by the occasional incident of an infected individual making it across Western borders.

10. Pope Francis will face political challenges from conservative hardliners.

It is unlikely that Pope Francis’ spate of rapid and theologically radical liberal reforms will be allowed to continue forever by the conservatives within the Vatican inner circles and conservative bishops elsewhere. Such conflicts have already flared up, and thus far, the Pontiff has prevailed.

Canon law has no procedure to impeach or recall a pope. I don’t think his job is in danger. His influence over certain conservative constituencies and their local directors will probably be reduced in increasingly conspicuous acts of defiance, though.

11. The global appreciation of the US Dollar will end.

The increased dollar demand is most likely due to:

  • The Federal Reserve is nearing the end of its most recent period of Quantitative Easing (QE), which is expected to pull back money supply.
  • The high performance of the S&P 500 spectrum of the US stock market.
  • Exuberance about American energy supplies and perceived domestic recovery in jobs and real estate.
  • Increased demand for hard reserve currency in places with high inflation, such as Russia and many of the former Soviet republics (whose currencies’ fate is, in many instances, closely linked to the rouble).

I think this exuberant climate will cool by the end of 2015Q2 and that former-USSR inflation will stabilise in tandem with rebounding oil prices. The stock market is thought to be in need of a correction phase. These things will send the dollar back down to historical norms.