Why Obamacare Means Insurance Refunds

At the reliably hyper Addicting Info, Wendy Gittleson is excited over upcoming insurance refunds due to the Affordable Care Act:

In a story that’s bound to send Republicans straight into the spin cycle, it was announced on Thursday that insurance companies will be refunding Americans $332 million because they’ve been overcharging them for healthcare.

That’s about a buck per American. And it’s funny she should mention overcharging, for reasons I’ll get to in a minute.

A generally ignored by Fox News part of the Affordable Care Act (aka, Obamacare) mandates that insurance companies spend at least $.80 of every dollar on *gulp* healthcare. The other $.20 can go toward administrative costs and all the other perks that CEOs of giant insurance companies enjoy. The law is even stricter when the policy is sold to a large employer, with a full 85 percent needing to go to healthcare. In other words, anti-Obamacare people, your insurance company is not charging you more because of Obamacare.

Actually, the ACA tends to push health insurance premiums up for three reasons:

First, the ACA specifies minimum coverage for all health insurance plans that can be used to satisfy the requirements of the Act, and anyone with less inclusive plans will have to switch to a conforming plan. All other things being equal, better coverage costs more, so some people will be paying more for insurance.

Second, the ACA limits the ability of insurers to refuse to cover pre-existing conditions or to charge more for them. To compensate for the losses they take covering people with pre-existing conditions, insurers have to increase the premiums they charge everyone in the plan.

Third, the medical loss ratio requirements of the ACA encourage insurance companies to demand higher premium payments. This is relevant to Gittleson’s post, but it requires a little explanation.

Insurance plans under the ACA are required to pay out at least 80% of premiums as benefits paid for members’ healthcare costs, taking their overhead costs (including profits for investors) out of the remaining 20% of premium payments. If, after everything has settled, it turns out they’ve paid out less than 80% of premiums received, they have to refund enough of the premium to get back up to an 80% payout. (This is what Gittleson is talking about.)

So, for example, if an insurance company took in $1 billion in premiums, it would be required to spend at least $800 million on healthcare. If instead it paid out only $700 million in benefits, it would have to refund $125 million back to plan members to get the loss ratio back to 80%.

It doesn’t work the other way around, however. If the company pays out $900 million in healthcare costs, they don’t get to send plan members a bill for $125 million. They just have to eat the $100 million loss. This asymmetry has consequences.

Assume that a particular insurance plan’s actuaries predict that the company will have to pay out $800 million in claims, and that there’s a 50/50 chance the actual claims will be over or under that amount by $100 million. Before the ACA, the company would estimate its costs at $800 million for payouts and $200 million for overhead costs, which means they’d want to charge $1 billion in premiums. When the year is over, they find out how well they did. If payouts were $900 million, they lose $100 million, but if payouts were $700 million, they’d make an extra $100 million in profits. On average, their outcome would be to have neither extra profits nor extra losses.

(You might be asking why the insurance company wouldn’t just charge an extra $100 million in premiums so they don’t lose money even if claims are $100 million higher. The answer is that I’m assuming that they are setting premium prices as high as they can in a competitive market. Every other insurance company faces the same costs, and therefore can offer insurance at the same price — which, as I said, already includes profit. If any company tried to raise its prices over that of other companies, it would lose all its customers to them.)

Under the ACA, however, the situation is no longer symmetric. With $1 billion in premiums, if payouts were $900 million, they’d lose $100 million that year, but if payouts were $700 million, instead of making an extra $100 million, they’d have to refund $125 million in premiums for a net $25 million dollar loss. So on average, with an equal chance of claims being $100 over or under estimates, the company would lose the average of $100 and $25 million — a projected loss of $62.5 million.

An insurance plan that is designed to lose an average of $62.5 million every year is bad business. To avoid the loss, insurance companies are going to want to raise premiums to $1.125 billion. Then if they had a good year and only paid out $700 million in medical costs over and above their fixed $200 million in operating costs, they would have to refund $250 million, for a loss of $25 million, but if they had a bad year and paid out $900 million in medical costs and $200 million in operating costs, they would make $25 million in profit. Symmetry would have returned, and they would once again have neither extra profits nor extra losses.

(Raising prices because of the incentives in the ACA is not blocked by competitive pressure because every other insurance company is also governed by the ACA and faces the exact same incentives.)

Obviously, I’m greatly oversimplifying, but the basic principle remains: By letting insurance companies take unexpected losses but not allowing them to keep unexpected gains, the ACA is actually encouraging insurance companies to raise their premiums to create a reserve against claims losses.

Note that insurance companies don’t actually make more profits this way, and consumers don’t actually pay any more for healthcare, because the high premiums are eventually refunded to consumers. However, the refunds don’t represent a saving for consumers either: The refunds are coming out of elevated premiums that are caused by the ACA itself.  Obamacare is just forcing insurance companies to take more in premiums so they can give it back as refunds later.

Rebates are not the goal of the Affordable Care Act. In a perfect world, there would be no rebates at all. The idea is that insurance companies will charge the right amount off the bat. The goal is also for the companies to cut overhead.

Costs have been going on the right trajectory. In 2011, the year the law took effect, insurance companies owed their customers $1.1 billion. Last year, that number was cut by more than half, at $500 million. Overhead costs have gone down too – to just 11.5 percent.

That’s a good thing if insurance companies actually cut costs, but that may not be what happened. A lot of people think that insurance companies deliberately underbid their premiums this year in order to gain market share. This is suggested by the reports that a number of insurance companies didn’t participate in the ACA exchanges (presumably priced out of the market by the underbidders) and the expectation that premiums will be increasing next year.

And regardless of what happens over the short term, the ACA sets up some funny incentives over the long term. In my example above, you’ll note that when healthcare costs were high, the insurance companies made more profits, but when healthcare costs were low, the insurance companies lost money because of the way refunds are calculated. The limits on medical loss ratios mean the insurance companies essentially have to live on their 20% of the pie, so naturally they do better when the pie is bigger. In the short run, they still have to compete with each other for customers, so they will want to control increasing medical costs, but in the long run they will do better if medical spending increases.

Unfortunately, increased spending doesn’t necessarily translate to improved health, because the insurance companies will benefit as much from wasteful spending as they will from spending that produces real health benefits.

If cutting overhead to 15-20 percent seems like an unrealistic goal in the free market, perhaps they could learn a lesson or two from Medicare, which conservatively, has an overhead of just 6 percent.

That’s because Medicare recipients typically have higher healthcare costs than the younger people covered by private insurance. It’s easier to keep the overhead down when your non-overhead expenses are proportionately high.

 

I’m Sure That Goes Both Ways

Here’s how I imagine my traffic stop going:

Officer: License and proof of insurance.

Me: Here you go.

Officer: Do you know why I pulled you over?

Me: Uh, no I don’t, officer.

Officer: You were doing 75 in a school zone.

Me: I’m sorry to hear you experienced that. I place the highest priority on safe driving, and I have passed all state-required driving requirements. I’ll investigate my recent driving behavior and I’m committed to learning any lessons that may arise from the results of my investigation.

Officer: Seems fair. Have a nice day!

Inspired by this horror, but we’ve all heard the same responses from police departments when their officers are accused of brutality. I’m sure that’s just what they’re looking for from me, right?

(Hat tip: Maggie McNeill)

Maggie McNeill at Liberty On the Rocks

So last weekend I had a conversation with my wife that went something like this:

Me: I’ve got some busy evenings this week. On Tuesday…um, this is going to be one of those awkward conversations…

Her: As long as you’re not seeing any hookers.

(silence for a few seconds)

Me: How about a retired hooker?

(silence again)

Her: That would be okay.

Maggie McNeill is the retired escort who blogs at The Honest Courtesan., and she has been on a driving tour of the country to promote her book, Ladies of the Night, which is a collection of short stories in various genres featuring members of the oldest profession. Both the book and her appearances are also opportunities to promote sex worker rights. I dropped in on her Tuesday evening appearance at a Liberty On the Rocks meeting at the Goose Island Brewpub on Clybourn.

Maggie McNeill at Liberty on the Rocks Chicago

Maggie wasn’t the only sex worker there. Serpent Libertine from SWOP Chicago was sitting at a corner, and I briefly said hello because I’d like to interview her someday about sex work activism in Chicago (assuming I ever get around to doing actual journalism again). A couple of male sex workers spoke up at the meeting as well.

I chatted with Maggie for a few minutes before her presentation, and I told her that before I started learning about prostitution enforcement through her blog, I hadn’t realized that the United States actually has one of the harshest anti-prostitution legal environments in the developed world. To emphasize this, I then somewhat ironically suggested that that the much-hated Swedish model of legalization, which emphasizes prosecuting clients and pimps instead of prostitutes, seemed like it would actually be an improvement. This turned out to be a mistake, because it derailed Maggie into explaining the problems of the Swedish model, which I kind of already know from reading her blog. Maggie was very patient and polite about it, though.

Many of the things Maggie spoke about will be familiar to regular followers of her blog, but it was still worth the trip to hear her talk about them. Her presentation ties it all together in a way that a series of blog posts just don’t.

Some of what she had to say was kind of depressing. We’re at a time when gay marriage is increasingly recognized and marijuana legalization is breaking out all over, yet sex worker rights have had some recent setbacks from dangerous legislation. I find it particularly worrying that Maggie describes a trend toward fighting prostitution with anti-racketeering prosecutions. That way leads down the same road to hell that the War on Drugs has been on for 40 years.

The cops and prosecutors and their enablers aren’t calling it the “War on Prostitution” however. Most people don’t really see prostitution as a threat to society or — perhaps more importantly when trying to stir up a moral panic– to society’s children. Instead, there’s been an increasing emphasis on “sex trafficking.” With the specter of strange men who will kidnap your children and force them into sex slavery, it’s a lot easier to get funding for anti-trafficking task forces and pass “tough” anti-trafficking legislation.

But since actual sex slavery is very rare in this country, they end up busting pretty much the same people they would have busted for prostitution. Then prosecutors pick a few of them to be charged with trafficking, perhaps for handling money or answering a phone, or perhaps just for being male. Clients get swept up for trafficking, as do male and transgendered sex workers. Sometimes sex workers are charged with trafficking each other.

All of this is a worrisome development. Maggie doesn’t quite reach Balko-esque levels of gut-punch, but the thought of the drug war’s industrialized system of arrest and incarceration metastasizing into sex work is depressing. On the other hand, just being in the room with people like Maggie and Serpent Libertine is kind of exciting. It feels a bit like being at the start of a civil rights movement.

I say “a bit” because I know that feeling is mostly subjective. It comes not because a sex worker rights movement is starting but because I’m learning so much more about it lately. The modern sex worker rights movement in the United States goes back at least as far as Margo St. James and COYOTE in the 1970s, and there has been a lot of progress by sex worker’s rights movements in other countries. (I’m pretty sure what I’m feeling is the same thing that leads journalists to write stories about a “new trend” they just heard about, no matter how long it’s actually been going on.) In some sense, my interest in the sex workers’ rights movement is actually a product of the movement’s outreach to non-sex-workers.

In any case, if Maggie comes to your town, it’s worth your time to meet her and hear what she has to say.

It’s the Better Government Party…or Is It?

I get a lot of spammy email about political issues and politics, but this one caught my attention:

Subject: A New Political Party- The Better Government Party Created by Mike Mann

Dear Mark,

I hope this e-mail finds you well!

I wanted to introduce my client, Mike Mann, to you in regards to your upcoming political features and interviews. A Washington D.C. native and Domain guru, Mann has decided to take on the task of establishing a new political party in the United States that he has dubbed the Better Government Party. We would love for you to highlight him in a business and/or political spotlight feature.

Mike Mann is the founder of non-profit and for-profit corporations including:

— SEO.com

— DomainMarket.com

Oh. That’s pretty much where I could have stopped reading. Because nobody in their right mind wants one of those search-engine-optimizing domain hoarding sleezebags to have political power.

But I didn’t stop reading. It was just too weird:

His vision for the Better Government Party is to eventually displace Republicans and Democrats, whose parties he says are useless, corrupt and fraudulent. His party will be built on transparency, trust and accountability. Better Government Party is willing to move past the political differences that divide our great nation along superficial lines.

**Mann is known as the man who bought up 14,962 domain names in 24 hours and had the three fastest-growing companies on the Inc. 500 in 2012. A lifelong philanthropist and lobbyist, Mann has the knowledge, experience and background that has readied him to create a party built on transparency, trust and accountability.

“Americans are so used to Congressmen lying, cheating and stealing that they have been conditioned to think it’s acceptable,” says the 46-year-old Washington, D.C., native, whose mother worked for the Environmental Protection Agency and father defended cases before the Supreme Court. “I’m trained and studied. I’m from Washington. I know this stuff.”

Yeah, okay. That doesn’t sound at all nutty.

Also, “better government for everybody” (or whatever) is not exactly an informative party platform. Before I’d support someone, I’d want to know what his vision of better government looks like.

So at this point I just had to visit the website to take a look at his — er, I mean the Better Government Party’s — positions on the issues. At first it all seemed like a lot of populist pablum. For example, this is from the vision statement:

Fiercely anti government corruption

Believes in healthcare for all US citizens

Believes in the best education for all US citizens

Believes in very strong environmental protection

Believes in an extremely simplistic tax structure like a flat tax or value added tax

Believes in free market economics

That’s a little vague, not to mention that the healthcare, education, and environmental positions are in conflict with the free market position. And frankly, it’s hart to tell from this short sample, but the whole site has a kind of “assembled from scraps” feel to it.

My first clue was at the bottom of the vision statement page, where I found this note:

Thanks for reading

Disrupt the Status Quo! — go Third Party!

Please also see:

http://MakeMillions.com/

http://Grassroots.org/

He’s actually linking to some of his other websites, including his “get rich quick” book.

Then I noticed that every page on the party site has an ad for WebStreetJournal.com, another one of his properties. There’s also a domains page on the Better Government Party website which has the message, “Do you have what it takes to turn one of these domains into a powerful next generation corporation or charity?”

Given that it’s on the Party site, you might think these are domains being offered to like-minded individuals or organizations as part of an effort to build a grassroots movement, but that turns out not to be the case. This is just a list of domains for sale at Mann’s DomainMarket.com site: HelpAmerica.com lists for $15,000, StopTheHate.com lists for $25,000, and InnerCityYouth.com lists for a whopping $45,000.

Holy Crap! Do you see what’s really going on here? I’m about 95% convinced that Mike Mann must have realized that the upcoming elections in 2014 and 2016 will cause a surge of online discussion of politics and decided to start a political party — or at least the web presence necessary for a half-assed pretense of a political party — in order to attract links that will boost the search engine page rank for his business sites.

That would mean the entire Better Government Party is one big SEO strategy for his other sites.

Site Meter WTF?

Have you been seeing pop-up ads on my blog?

You see, a couple of days ago I was fiddling with some darned thing here in WordPress — I can’t remember what it was anymore — and I wanted to take a look at how the page lays out to ordinary people. As a logged-in WordPress user, I get extra features like a command bar at the top and special links I can click to edit content, and I wanted to get a look at the site without any of that. I could just log out, but then I’d have to login again to tweak it some more, and that’s a pain.

So instead, I launched the Chrome browser in “incognito” mode, which runs the browser with no cookies of any kind, as if it had never been launched before, which means my blog will treat it like just another random first-time visitor.

And the darnedest thing happened. Some kind of full-page ad popped up and completely covered the contents of my blog? At the top it had the words “A Message From Our Sponsors” with a link in the upper right corner labeled “Click to continue to site” or something like that. It was just like one of those full page ads you sometimes get when you follow a link to a big media property like Forbes.

What the fuck?

Just to be clear, I don’t put ads like that on my blog. I have an Amazon banner on the right side, and another one at the bottom of every article, and that’s it. Whatever this was, I didn’t do it.

I flipped on developer mode in the browser and took a look at another page. I wanted to see where it was getting content from. This page didn’t show the ad, but when I looked at the Network tab, I was in for another shock. The first file was the main HTML page, and the next dozen or so were the usual bits and pieces from the wordpress folder, bits and pieces of CSS, Javascript, and a handful of images. An awful lot of the rest of the files were stuff I didn’t recognize.

There’s always some of that on a page. If you use widgets or Javascript code to link to Twitter or Facebook or Amazon or Gravatar, the tiny stub of code you use to do that pulls down more code and other assets that it needs to function. But this went beyond any of that. It was hitting a horrifying array of unfamiliar sites:

  • specificclick.net
  • vindicosuite.com
  • yashi.com
  • demdex.net
  • nexac.com
  • bluekai.com
  • mookie1.com
  • spotxchange.com
  • turn.com
  • adadvisor.net
  • ib-ibi.com
  • doubleclick.net
  • scorecardresearch.com
  • adnxs.com
  • specificmedia.com
  • rubiconproject.com
  • invitemedia.com
  • btrll.com
  • collective-media.net
  • tidaltv.com
  • tubemogul.com
  • exelator.com
  • mathtag.com
  • dotomi.com
  • casalemedia.com
  • pubmatic.com
  • cpmaxads.com
  • advertising.com
  • criteo.com
  • adsrvr.org
  • veruta.com
  • wtp101.com
  • connexity.net
  • openadserve.com
  • insightexpressai.com
  • doubleverify.com
  • serving-sys.com
  • betrad.com
  • vizu.com
  • 2mdn.com

As near as I can tell, every single one of those is in some way associated with web advertising. Someone was using my blog to get credit for distributing ad content. At the very least, they were probably littering my visitors’ browsers with tracking cookies.

I’m truly sorry about that. This is an embarrassing discovery, and I apologize.

On discovering this, I got a little panicked. My mind went to a bad place: It was possible I had been hacked via malware in a WordPress plugin. WordPress and all its plugins and themes are built on PHP and PHP is wide open: Every WordPress plugin, every theme, has complete access to all the files in a web server account. If any one of the plugins is malicious, it can infiltrate itself into a WordPress installation in ways that are hard to remove. It’s like a virus.

You should never install WordPress plugins or themes from an untrustworthy source. The plugins and themes that you can find from within WordPress via the Add New button have been somewhat vetted by the community and are probably safe, but with the exception of a few reputable vendors, you should never download and install a theme or plugin from another web site. One study on a small sample of random free WordPress themes found that 100% of them had some kind of hidden code to insert tracking cookies or place hidden links on the site. Every single one.

I had been careful about adding plugins, but maybe I had made a mistake, or maybe one of them had slipped past the guards on the WordPress repositories. I began disabling plugins, starting with the most recent ones, and refreshing the page to see if the invading websites were still there. Eventually I got down to just a handful of trusted plugins — Google, Amazon, stuff everyone installs — and the ads were still there.

The culprit turned out to be one of the oldest things I had ever put on my site: The Site Meter badge. I’ve had that thing on my website since before WordPress. I think I even had it before MovableType, back when I was hosted on Blogger. At the time, every blogger in the world used Site Meter to track their stats, and I was no exception.

Site Meter didn’t press their advantage, however, and they didn’t keep up with the times. Their simple counter and statistics are no match for a modern powerhouse like Google Analytics or Woopra. Apparently, at some point they just gave up trying to monetize stats and started just pushing out all kinds of advertising crap. Given how many advertising companies they’ve sold my site to, I assume they’re trying to squeeze out as many tiny fractions of a penny as they can.

(This was actually good news, since Site Meter was just a <script> tag I had embedded in the footer. It didn’t run any PHP code on my site, so it couldn’t have corrupted anything else. It all ran in the relatively safe sandbox of my visitors’ browser.)

I Googled around about this, and apparently everyone else noticed the problem a few years ago. I wasn’t paying attention, and I missed it. I guess that’s because I don’t really use Site Meter any more, and I would have abandoned it, but…it was the oldest counter I had on the site, and I was enjoying watching the numbers climb. It used to go up pretty fast, and I would have reached my first million several years ago, but my site statistics took a dive about 6 years back when I was busy taking care of my parents.

According to Site Meter, I still haven’t quite reached my first million visits. The counter currently sits at 999315.

And there it will stay.

Considering a Geiger Counter

It probably says something about me that I’m thinking of buying a Geiger counter.

It’s not that I really have a need to detect radioactivity, exactly. But you know all those CSI shows where they pull out the UV light and shine it around a crime scene to find suspicious stains? If you tried that at home, the ultraviolet light would probably find all kinds of messes — where the dog peed on the rug, or a child spilled food, or granddad didn’t quite make it to the bathroom that one time — things you’d probably rather not know are there. And you’re really better off not knowing what would show up if you tried that on the sheets the next time you’re staying at a cheap hotel.

Well, I have this theory that there’s a little bit of the same thing going on with radioactivity. That is, I think if I poked around with a Geiger counter in some likely places — the alleys behind hospitals, university science buildings, junkyards that are not supposed to be used for radioactive waste — I’ll bet I’d find some radioactivity that’s hanging out where it’s not supposed to be.

Also, all kinds of radioactive stuff got into the wild in the early days of the nuclear age, and some of that stuff is still knocking about — radioactive samples from educational kits, mid-1900’s red-glazed earthenware, radioactive materials that were not properly disposed of and we reworked into everything from elevator buttons to jewelry — and it would be fun to try to find some of it.

Truthfully, I need to research this a lot more. I need to have a much better plan for finding stuff than just “looking around.” I’m not even sure what kind of Geiger counter I’d need. I’ll have to come up with theories backed by historical evidence for how radioactive materials could get into the environment in quantities I could detect with equipment I can afford. Then I’d have to come up with a plan for searching for it, preferably without attracting the kind of attention you might get when someone points out the strange guy with a clicking box to the police.

It probably says something about my marriage that when I told my wife I was thinking of buying a Geiger counter, she was genuinely surprised that I didn’t already have one.

Net Neutrality Pisses Me Off

The debate over “net neutrality” just makes me angry. The purpose of net neutrality is to force internet service providers to carry all content equally. The ISPs — really mostly cable companies — would like to dump net neutrality so they can charge special rates for certain content such as streaming video. This would allow them to offer “high-speed lanes” to services like NetFlix and Amazon Instant Video. As their opponents like to point out, however, dumping net neutrality would also effectively allow them to degrade less favored content, which would give cable companies a lot of control and allow them to discriminate against certain content providers.

The economic argument against net neutrality is the argument in favor of free markets: The cable companies should be able to provide whatever level of service they want to any content they want, as long as they can get customers to pay. This would tend to solve the problem of discrimination because while some content providers would pay more for higher quality service, the cable companies would still have to carry all content at reasonable speeds, otherwise they would lose customers. Competition for viewing households will keep them in line.

Except it won’t.

That’s because, by and large, the cable companies do not compete with each other. Here, for example, is a map of the service areas for Comcast and Time Warner Cable, the two largest cable companies (courtesy of Lance Ulanoff at Mashable):

Comcast and TWC

You’ll see that Comcast is red and TWC is blue. What you won’t see, however, is any purple, because for the most part, Comcast and TWC do not directly compete for viewers. (There are other cable companies, but they don’t compete against Comcast and TWC either.) No cable company controls the whole national market, but customers don’t care about the whole market, they care only about the cable service available in their home. And for most individual homes there is only one available cable company. That means that my free market solution won’t work: Competition won’t keep ISPs in line because there is no competition.

That’s why the net neutrality argument pisses me off: It wouldn’t even be an issue if the cable companies weren’t local monopolies, yet almost nobody is talking about that.

Undoubtedly there are some areas which are served by only one cable company because they don’t have the customer base to support more than one, but in most cases the reason only one cable service is available is because the local government doesn’t let any competitors provide service. The cable companies have somehow managed to get local regulators to give them a monopoly. And almost nobody is talking about that either.

If cable companies faced real competition, they wouldn’t be able to degrade service for some content because customers wouldn’t stand for it. They’d have to provide high speed service for everything, and probably a lot faster than they’re providing now. They’d also have to provide web sites that are actually useful, service technicians who are motivated to solve problems, and customer service offices that don’t make you feel like an intruder.

I wish we could stop arguing about “net neutrality,” which only fixes part of the problem (at the cost of further interfering with the free market) and begin talking about the real problem, which is the local cable monopolies. Perhaps the best approach would be to only relax the requirement for net neutrality in areas where there is strong broadband internet competition — at least four or five competing providers.

The problem with that idea is that under any regulatory system, the cable companies will probably get the government to define “competition” so broadly that it’s meaningless. Don’t believe me? Then go to the official National Broadband Map website and get a list of all the supposed cable providers for your home address. Check the result against the services actually available from the listed companies. Do they all provide speeds as high as in the official listing? Are some of them exotic business-quality services that are far more expensive than the cable company? Heck, how many of them are not landlines at all — just cell-phone providers with internet-capable towers in your neighborhood?

Have I mentioned that this really pisses me off?

2013 Road Trip Report – Part 4: The Road to Avalon

(I’ve been writing a rambling travelogue for last year’s trip to the Jersey shore. Part 1 got me from Chicago to Toledo, Part 2 got me to Wilkes-Barre, Pennsylvania, and Part 3 got me to New Haven, Connecticut. I’m running out of interest in writing these, but I think I have at least one more.)

I woke up the next morning and started my drive to Avalon. I decided to take the Merrit Parkway into New York City because it sounded more scenic, and I wanted to try out the GoPro camera now that I had a good memory card. This time I tried mounting it by sticking it out through the moon roof and clamping it in place with the motorized sliding panel. Unfortunately it got tilted to one side almost immediately. I can correct that in post, but there isn’t nearly enough resolution to play with in video as there is in a still image.

Here’s a sample of what I got:

I reached New York at a reasonable time of day, but that didn’t stop me from getting stuck in bad traffic. It took me a good hour to get through the bulk of the city. Maybe longer. Eventually I made it onto the Garden State Parkway. I had wanted to get some video of that, but it was raining and I was running a bit late.

My wife had flown out earlier, and she had rented a car at the airport to get around, so the plan was for her to drop it back office at the Atlantic City airport rental car return, where I would pick her up on the way to Avalon. There was some construction at the airport, and we both got confused and parked in the wrong place — she was in airport parking of some kind, and I had driven my car into the rental car return area. She eventually brought her car in, and I got a ticket from the rental agent to get our car out of the lot.

Then we drove down into south Jersey to Avalon, where our friends had rented a house for a couple of weeks.

The Queen is a Fink!

I’ve known for many years that access to this blog is blocked in mainland China. Well, sometimes it is and sometimes it isn’t. I imagine it all depends on how recently I’ve mentioned the Tiananmen Square Massacre. As I write this, it’s not being blocked (I checked here), but that could change since I just mentioned the Tiananmen Square Massacre twice now.

However, thanks to the London-based Open Rights Group (which I stumbled upon in the sidebar on Charlie Stross’s blog), I’ve discovered that my blog is now banned by some of the ISP content filtering recommended by the U.K. government.

You may remember hearing that the UK had pressured ISPs into blocking pornography in their default settings. (People who wanted to receive it could remove the block.) But the blocking also included other categories such as malware, drugs, gambling, suicide, weapons and violence, obscenity, hate, cyberbullying, and hacking. This site is not particularly about any of those things, but I do discuss them in the context of analyzing public policy, and like most automated filtering, it blocks a lot of stuff that it shouldn’t.

I checked around on my blogroll, and surprisingly few of them are blocked. Scott‘s not, and neither is Popehat, despite their extensive discussion of criminality. Even Pete Guither’s Drug WarRant isn’t blocked, and all he talks about is drugs. On the other hand, Maggie McNeill‘s site about sex work is blocked kind of a lot, and anthropologist Laura Agustín‘s site about migrant sex work is blocked a little. It sounds like the Brits are threatened by the sexiness.

Or maybe I just say “fuck” too often.

You can check your site here.

(Title allusion here.)

Keep Talkin’ Judge

One of the most amazing developments in the legal blogosphere last year was the emergence of the Hercules and the Umpire blog, because it was written by an actual sitting federal judge. It wasn’t just warmed-over pablum, nor was it some sort of scholarly legal blather. Instead, like a classic blogger from the early days, a federal judge just started telling us what it’s like to do his job. He expresses his opinion about a variety of related issues, he takes a stand, and he even goes off on a rant from time to time. In a few cases, his blog posts have pissed people off and earned him some harsh criticism.

Welcome to the blogosphere, Judge Kopf. We’ve got donuts.

I don’t actually read Hercules and the Umpire very often unless I find a reference to it from one of my regular daily reads. In part, that’s because Judge Kopf’s focus on issues affecting the judiciary is a little too specialized for me. I’m not familiar enough with the issues to understand how to think about them, and I’m not interested enough in them to learn more. My concerns tend to focus on the design and consequences of public policies, whereas HatU is more about how the judiciary does the things they do.

Along those lines, Judge Kopf wrote on Saturday about the Hobby Lobby case, in which the Supreme Court ruled that, due to the religious beliefs of its owners, the Hobby Lobby chain did not have to comply with the regulatory interpretation of the Affordable Care Act by offering certain specific kinds of female contraceptives in its employee medical plans. I had previously made the point that this was a relatively minor issue that was turning into a giant legal and political battle that has now gone all the way to the Supreme Court, and that we could expect more such battles in the future because the ACA made all kinds of healthcare-related decisions into political issues.

Kopf’s point was based on a similar view of the importance of the contraceptive mandate:

To most people, the decision looks stupid ’cause corporations are not persons, all the legal mumbo jumbo notwithstanding. The decision looks misogynistic because the majority were all men. It looks partisan because all were appointed by a Republican. The decision looks religiously motivated because each member of the majority belongs to the Catholic church, and that religious organization is opposed to contraception. While “looks” don’t matter to the logic of the law (and I am not saying the Justices are actually motivated by such things), all of us know from experience that appearances matter to the public’s acceptance of the law.

The Hobby Lobby cases illustrate why the Court ought to care more about Alexander Bickel’spassive virtues“–that is, not deciding highly controversial cases (most of the time) if the Court can avoid the dispute. What would have happened if the Supreme Court simply decided not to take the Hobby Lobby cases?  What harm would have befallen the nation? What harm would have befallen Hobby Lobby family members who would  have been free to express their religious beliefs as real persons? Had the Court sat on the sidelines, I don’t think any significant harm would have occurred. The most likely result is that one or more of the political branches of government would have worked something out. Or not. In any event, out of well over 300 million people, who would have cared if the law in different Circuits was different or the ACA’s contraception mandate was up in the air?

The reason Judge Kopf advances for avoiding highly controversial cases is to preserve the legitimacy of the court. After all, the court has no army to enforce its decisions, so people — including politicians, bureaucrats, and police officers — obey the court out of a tradition of respect and mutual acceptance of the legitimacy of its decisions, and the court would do well to not to waste that obedience on heated controversies that aren’t very important in the grand scheme of things:

Bickel was not trying to protect the Court itself. On the contrary, he realized that there were “hot button” cases that an anti-democratic Court would of necessity be required to resolve. It was for those rare “fate of the nation” cases, where the Court’s legitimacy mattered most to public acceptance of a really important decision, that required the Court to conserve this very scare resource.

Judge Kopf thought it was time for the Supreme Court to ease up before they lose the support of the people:

Next term is the time for the Supreme Court to go quiescent–this term and several past terms have proven that the Court is now causing more harm (division) to our democracy than good by deciding hot button cases that the Court has the power to avoid. As the kids say, it is time for the Court to stfu.

Kopf is essentially arguing that it is necessary for the Supreme Court to allow some injustices to go uncorrected in order to retain the moral authority necessary to correct other injustices that are presumably more important. He’s not saying that making that kind of tradeoff is a good thing, only that it’s a necessary thing for the long-run good of the justice system.

I never thought of that before, but my gut feeling is that it makes some sense, especially since the Supreme Court is always limited by time constraints. The sheer volume of cases means the have to pick and choose which ones to hear, and so they might as well be strategic about it. On the other hand, there’s also the argument that the best way to maintain the court’s authority is to use it regularly, so that people become accustomed to acceding to its authority. I think this is a fascinating discussion about how the Supreme Court can assert leadership in the national legal arena.

However, according to Scott Greenfield, a number of people latched onto something that completely escaped me, the very last word of Kopf’s post, “STFU.” Apparently, this might be the first time that a sitting Article III judge has publicly told the highest court in the land to “Shut The Fuck Up.”

Responding in part to this controversy, Judge Kopf reprints a letter he received from a lawyer, advising him that it is time to stop blogging:

[...] in my 25 years as a lawyer, it is my inescapable conclusion that an important element, perhaps the most indispensable one, in our legal system’s ability to deliver justice is public trust in judges.

Well, I’m going to dispute his premise right there. I have no doubt that public trust in judges is an important part of the legal system’s ability to deliver justice. But I think something even more important than public trust in judges is that the judges be worthy of that trust.

In order for our system to work, the public must know that a judge will decide matters thoughtfully, impartially, respectfully, and on the merits.

This is where I have a fundamental disagreement with Kopf’s letter writer: He wants the public to “know” something that simply isn’t true. We certainly want judges to decide matters thoughtfully, impartially, respectfully, and on the merits, and I’d like to think that the majority of judges will do that the majority of the time, but certainly they won’t all do that every time.

How does such attention and reaction create an appearance that assists the public’s acceptance of the law, help people trust judges, foster faith in our system, and advance the cause of the delivery of justice?

It probably doesn’t, and it probably shouldn’t. There’s such a thing as placing too much trust and confidence in judges. Some judges will be idiotic, other times they will be assholes. Our judicial system is unavoidably human and therefore necessarily imperfect. Trust and faith in the system are important, but only to the extent that they are based on a realistic assessment of the quality and capabilities of the system. Trusting judges too much is just as bad as trusting them too little.

As I understand it, part of your motivation for continuing with your blog is your passion that “federal trial judges be seen as individuals with all the strengths and weaknesses (baggage) that everyone else carries around.” [...] I fail to understand the particular level of importance you apparently ascribe to folks’ possession of that understanding about judges. What difference does it make whether federal trial judges’ strengths and weaknesses and baggage are properly understood?

The same difference it makes for anybody else in any other job: We want to make sure we aren’t depending on them to do something they are incapable of doing.

[...] a judge should display the thoughtfulness and restraint appropriately expected of people who have accepted society’s call to judiciously make important, vital decisions. It is entirely proper for us to expect that judges not be publicly profane, lewd, or disrespectful; and it is entirely proper to expect judges’ words and deeds to be consistent with the high ideals of integrity and justice. In fact, the success, or lack of success, of our legal system largely depends on judges’ meeting these standards.

Here the judge’s critic has subtly switched subjects. Until now he has been speaking about the extent to which Judge Kopf’s blog undermines public confidence in the judicial system (and implicitly about whether that would be a bad thing). In this section, however, he changes his focuses to the more personal question of whether Kopf is behaving properly in his role as a judge.

I don’t know enough about the court system to have a strong opinion about whether Kopf’s uncensored comments on his blog illustrate that he is unfit to be a judge. (My gut feeling is that we tolerate much worse from judges, just not in the form of blog posts.) What I do know is that regardless of whether you think Kopf is a thoughtful judge who provides valuable insights into the humanity of the federal judiciary, or you think that Kopf is an intemperate fool who should resign from the bench, you think that because of his blogging. You’ve learned something about Judge Kopf specifically and the judiciary in general. Whether this is good news or bad news, it’s still information, and more information is always better.

So if Judge Kopf decides to stop blogging because he feels it undermines his ability to do his job as judge, that might make sense. I wouldn’t know. But if Judge Kopf is worried that his blogging will undermine public trust in the judiciary, I say keep talking. Undermining trust in the judiciary might be just what we need. Or not. But we’ll have a better chance of figuring it out if we know more about it.

Much Ado About $300

I think the reaction to the Hobby Lobby case is going to make me mental. Case in point:

Protesting the Hobby Lobby Decision

That’s from a Mother Jones article by Erika Eichelberger and Molly Redden titled “In Hobby Lobby Case, the Supreme Court Chooses Religion Over Science”. Does the young woman holding the sign realize that she’s saying it’s not her boss’s business that she wants him to pay for her contraception? This is as dumb as those right-wing protesters who want to “keep the government out of my Medicare.” If she doesn’t want her boss involved, she can buy the contraceptives herself. It’s her insistence that her employee health insurance should cover contraception that causes her employer to be involved.

As for the Mother Jones article’s main point about science and religion,

According to the Food and Drug Administration, all four of the contraceptive methods Hobby Lobby objects to—Plan B, Ella, and two intrauterine devices—do not prevent the implantation of a fertilized egg into the uterus, which the owners of Hobby Lobby consider abortion. Instead, these methods prevent fertilization.

I’m not sure that’s a completely accurate description when it comes to some forms of IUD. My admittedly sketchy understanding is that if an egg does get fertilized, the IUD could interfere with implantation, which meets some religious people’s definitions of abortion, which they regard as the murder of babies. That may not actually be true, but it’s what a lot of people believe, which is pretty much the definition of religion.

However, it’s not the Supreme Court that is choosing religion over science. Congress did that when they passed the Religious Freedom Restoration Act (RFRA). When a later Congress passed the Affordable Care Act (ACA, also called Obamacare), they left the choice of required insurance coverage up to the regulatory bodies of the Executive branch. However, because they were either neglectful or cowardly, Congress failed to specify how to resolve conflicts between RFRA and ACA. The Obama administration chose to require contraception coverage, the folks at Hobby Lobby objected, and the whole mess dragged through the court system until it was finally resolved by the Supreme Court.

As I’ve said before, this is a stupid way to run a healthcare system. All of this fuss is about four items in the ACA required formulary. All of this fighting is about a benefit which Megan McArdle argues is worth about $300 per year to the fraction of the population that uses it. When you make the provision of healthcare a matter of public policy, you make every element of the healthcare system a matter of politics. There are going to be a lot more battles like this one.

The Pope On Drugs

A few days ago, over at Crimlaw, Ken Lammers, whom I admire, had a few things to say about the idea of legalizing drugs. Ken starts by quoting Pope Francis, whom I admire somewhat less. (Hey, what can I say? I was raised a Lutheran, and the First Rule of Lutheran Club is the Catholics are wrong.) When it comes to drugs, the Pope is (no surprise) an old-school anti-drug conservative:

Let me state this in the clearest terms possible: the problem of drug use is not solved with drugs!

No, but that’s not really the point of legalization.

Drug addiction is an evil, and with evil there can be no yielding or compromise.

It appears that His Holiness hasn’t quite passed the word to the rest of the team. The Catholic Church, to its credit, runs rather a lot of addiction rehab facilities, and they take a different view. One of the first addiction recovery services I found, Catholic Charities, Diocese Trenton, has this to say about addiction: “No matter which kind of addiction, it is important to recognize that addiction has nothing to do with one’s morality or strength of character.”

In fact, the overwhelming sentiment toward addicts by the people who treat them is one of compassion. For the Pope to imply that they are evil goes against the basic principles of addiction treatment, including the addiction recovery services offered by his own church.

But perhaps I misunderstand. Perhaps the Pope is distinguishing between the addict and his or her addiction. Perhaps the latter is evil, and the former is only its victim. Hate the sin but love the sinner and all that. Fair enough. But under those terms, those of us who favor legalization are also trying to help the sinner.

To think that harm can be reduced by permitting drug addicts to use narcotics in no way resolves the problem. Attempts, however limited, to legalize so-called “recreational drugs”, are not only highly questionable from a legislative standpoint, but they fail to produce the desired effects.

If the Pope believes that, then the Pope has a limited understanding of the desired effects of drug legalization. If all currently illegal drugs were legalized tomorrow, I wouldn’t use any of them. I want drugs legalized because I want the police to stop sending armed SWAT teams to raid homes and shoot dogs. I want police to stop shackling people and hauling them off to be locked in cages for years. I don’t want legalization because I want drugs. I want legalization because I want the police to stop killing innocent pastors and setting babies on fire. That would be a “desired effect.”

Substitute drugs are not an adequate therapy but rather a veiled means of surrendering to the phenomenon.

I don’t know enough about addiction therapy to say whether methadone and other substitutes are an effective treatment for drug addictions. But I’m pretty sure the Pope’s plan to lock drug users in cages is not therapy either.

Here I would reaffirm what I have stated on another occasion: No to every type of drug use. It is as simple as that. No to any kind of drug use. But to say this “no”, one has to say “yes” to life, “yes” to love, “yes” to others, “yes” to education, “yes” to greater job opportunities. If we say “yes” to all these things, there will be no room for illicit drugs, for alcohol abuse, for other forms of addiction.

On this I personally agree with the Pope. I’ve said “no” to illegal drugs all my life, and I plan to continue to do so. I rarely even drink booze, and that’s legal. Where we differ is that I don’t want to force my lifestyle on other people.

Ken Lammers has some commentary of his own:

…I find this to be a distillation of my personal beliefs about drugs. Legalization is unlikely to do the user much good. It will just switch the dealer from some guy on a corner to some guy behind a 7-11 counter.

Ken apparently doesn’t see any contradiction between those last two sentences. Buying drugs of uncertain origin, purity, and composition from a guy whose real name you don’t know is a dangerous way to get high. A drug user would be much safer buying a carefully manufactured product from a storefront backed by a corporation that wants to preserve the value of its brand and which can be hit with a multimillion dollar class-action lawsuit if the product is defective. I’m guessing that will do drug users a lot of good.

Also, the guy behind the counter at 7-Eleven isn’t going to wrestle him to the ground, throw the cuffs on, and haul him off to jail. That’s also good.

And I doubt that any cocaine producing Columbian cartel could ever match the predatory nature and capabilities of Big Pharma. After all, the Medellin cartel can’t run ads during the super bowl or deliver its product to every single grocery store, pharmacy, and convenience store in America – Proctor & Gamble (pepto bismo) and Bayer (aspirin) already do.

Here we come to a more profound difference between my views and Ken’s (or the Pope’s). I think that having digestion aids and pain medication conveniently available just a few minutes away is one of the advantages of our modern civilization. The Walgreens down the block stocks thousands of items — canned soup, milk, batteries, shampoo, condoms, light bulbs, toys, memory cards, makeup, candy — and it’s open 24 hours, so I can get what I want, when I want it. I think making high-quality recreational drugs available on the same basis is a good thing. It’s certainly better than having the manufacture and distribution of recreational drugs controlled entirely by criminals.

Anyone who believes addiction will decline in such an atmosphere is either naive or choosing to turn a blind eye to reality.

One distinction that seems not to be recognized by the Pope, and maybe Ken Lammers, is that drug use is not the same as drug addiction. People can use drugs without becoming addicted or ruining their lives, and there are far more casual drug users than addicts, even for relatively scary drugs like meth and heroin. When it comes to a less dangerous drug like marijuana, millions of people have proven that safe use is possible. Plenty of marijuana smokers have gone on to have normal, successful lives, including the current President of the United States. And his predecessor. And the one before that.

The risk of arrest and prison is part of the cost that the drug user pays when deciding to consume illegal drugs, so legalizing drugs is the economic equivalent of lowering the price. In addition, everyone in the supply chain incurs a risk of arrest and prison just for handling the drugs, and they all demand compensation for the risk, which results in a high price for the final consumer. So legalizing drugs will also reduce the actual price charged to consumers. Economics 101 tells us that lowering the price will increase the consumption, so I fully expect drug use to go up if drugs are legalized.

Whether drug abuse or addiction will also go up is more complex question. If some percentage of drug users are destined to become drug addicts, then increasing the number of users will increase the number of addicts, assuming that the new users are just as likely as the original users to develop addiction problems.

On the other hand, industrialized production and distribution will reduce impurities and variations in quality, reducing health complications and making overdoses less likely. And I think that increased social acceptance will make it less likely that drug users will be excluded from their communities, less likely that they will have trouble finding jobs, and more likely that they will be able to get help when they need it, especially since they can ask for help without fear of being arrested. Even for those who are addicted, the low cost of recreational drugs will reduce the financial burden of addiction. Finally, legalized drugs will directly benefit both casual users and addicts by eliminating the risk of arrest and imprisonment, and the reduction in enforcement efforts is a benefit in itself — no more late night raids, no more innocent grandmothers getting shot, no more puppycide.

I believe that legalizing drugs will probably increase drug consumption, but I think it will also reduce the harm caused by drugs, including the harm caused by law enforcement agencies and the justice system. That’s why we sometimes call it harm reduction. I suppose it is a “compromise,” but it’s not a compromise with evil, it’s a compromise with reality.

The Pope, on the other hand, seems to be engaged in magical thinking: He apparently believes that if we say “No to every type of drug use” then people won’t abuse drugs. He doesn’t seem to realize that his version of saying no necessitates the creation of a massive government program of spying on citizens, violently assaulting them, and throwing them in cages.

Buffer Zones and Free Speech Zones

Over at Addicting Info (a.k.a. Buzzfeed for liberal politics) Justin Rosario is trying to portray the Supreme Court’s recent decision striking down so-called “buffer zones” around abortion clinics as a case of giving special free-speech rights to rich people:

It seems that while your regular woman on the street has no way to keep religious fanatics from harassing them while they seek 100% legal healthcare, the rich can hire security to keep you and your petty complaints at arm’s length. So because they’re rich they get special rights. Again. What a shocker!

Uhm, I’m pretty sure that private bodyguards aren’t allowed to close off parts of the public sidewalks for their rich clients. More likely, they conduct their affairs on private property that’s big enough to keep the rabble away.

I pointed out that during the Occupy Wall Street protests, we were not allowed to actually march on Wall Street. We were diverted around it. This should have been 100% illegal but, of course, you can’t have the rabble pestering the masters of the universe as they rake in billions from an economy they destroyed.

Yeah, that wasn’t private security keeping you off Wall Street. That was the New York Police Department. (That police departments often function as private security for the rich and powerful is a different problem.)

However, Rosario sort of touches on something I’ve been wondering about ever since the court handed down the decision: If free speech means that anybody on a public sidewalk has the right to talk to anybody else that’s there, and if this includes the right to approach close enough to have a conversation, then shouldn’t this mean the end of “free speech zones”?

Whenever there’s a World Trade Organization meeting or a political convention or a controversial college guest lecturer, police like to set up these so-called “free speech zones” for protesters, usually far enough away that the people they’re protesting against can’t hear or see them. But if you can’t keep people from protesting outside an abortion clinic, how can you keep them away from a convention hall?

The United States of Paranoia – Review

The nice folks at the Reason Foundation sent me a free review copy of Jesse Walker’s The United States of Paranoia: A Conspiracy Theory all the way back in September of last year. At the time I was churning through my close reading of Radley Balko’s Warrior Cop, so it took me a month or so to get around to reading Walker’s book. And after reading it, I really didn’t have much to say about it, so I kept putting off writing anything.

I still don’t have as much to say as I did about Radley’s book (which will probably come as a relief to readers) because United States of Paranoia doesn’t really tell a single unified story that I can talk about. Stories have arcs and plots, but one of the guiding premises of the book is that when it comes to conspiracy theories and paranoia, not much has changed. So USoP is more like a collection of short stories tied together by a common theme.

Of course, when I say “stories” I’m not talking about fiction. These are true stories. Well…they’re sort of true stories. I mean, many of the conspiracy theories are wild nonsense and paranoia, with little or no truth to them, but they are conspiracy theories that people really, truly believed in. United States of Paranoia is filled with true stories about untrue stories.

Jesse Walker seems to have been inspired to write this book at least in part by Richard Hofstadter’s 1964 essay, “The Paranoid Style in American Politics,” in which Hofstadter discusses political paranoia and conspiracy theories in fringe political movements. Walker has argued at least since his 2009 article “The Paranoid Center” in Reason magazine, that paranoia and conspiracy theories are often found in the mainstream.

In 2006, a nationwide Scripps Howard survey indicated that 36 percent of the people polled—a minority but hardly a modest one—believed it “very” or “somewhat” likely that U.S. leaders had either allowed 9/ 11 to happen or actively plotted the attacks. Theories about JFK’s assassination aren’t a minority taste at all: Forty years after John F. Kennedy was shot, an ABC News poll showed 70 percent of the country believing a conspiracy was behind the president’s death. (In 1983, the number of believers was an even higher 80 percent.) A 1996 Gallup Poll had 71 percent of the country thinking that the government is hiding something about UFOs.

In the worst case, these mainstream conspiracy theories become political causes and influence legislation and public policy. Probably the most infamous recent conspiracy theory to take hold is the Satanic Ritual Abuse panic that spread through law enforcement agencies in the 1980s, when police investigators and prosecutors (and unfortunately judges and juries) seemed willing to believe any stories told by the child victims, no matter how incoherent or imaginative.

One child [...] began by saying she had no secrets to share, then eventually declared that she had been raped. After more days of questioning, she said “she was forced to drink [a teacher’s] urine and to consume his feces covered with chocolate sauce.” With time the girl “was talking about animals being slaughtered at the school and about how she was taken to a ‘mansion’ to be molested,” about adults “forcing her to take drugs, about fellating animals, about trips to a church and ‘devil land,’ and about being made to touch dead people.”

More recently, sex work activists like Maggie McNeill have been chronicling the conspiracy-theory-like thinking engaged in by so many people who are worried about human trafficking.

Although Walker didn’t write United States of Paranoia as a guide to recognizing and analyzing conspiracy theories, that’s certainly something you will be better equipped to do after you read the first of its two major sections, “Primal Myths,” which discusses some of the conspiracy theories that have circulated in the United States since before it was a country. This is an effective way to illustrate the structures of conspiracy theories, because the myths are no longer in our common consciousness, they concern matters no longer of direct importance, so we don’t get caught up in them as we think about them. However, it’s not hard to see the similarity of the old conspiracy theories to modern ones, which helps us to recognize and think about them.

Walker attempts to organizes the conspiracy theories into taxonomic categories roughly according to the identity of the bad guys: The Enemy Outside, the Enemy Within, the Enemy Above, the Enemy Below. (Walker also identifies a fifth category — the Benevolent Conspiracy — which posits a secret society working behind the scenes to help us and protect us from greater evils.)

In the early days of what eventually became the United States, the local Indian tribes were a prime candidate for conspiracy theories about the Enemy Outside. The mostly Christian immigrants were suspicious of the non-Christian Native American religions, often suspecting the Indians of being in league with Satan. On the other hand, most of the immigrants were Protestants, leading some of them to suspect that the Indians were in league with the Catholics. Making matters worse for the conspiracy-minded (and for the Indians), the colonists were unreasonably concerned that the tribes were on the brink of uniting under some imaginary “superchief” or Indian “King.”

Like most conspiracy theories, these fears were not completely made of whole cloth. Some tribes were a real source of danger for the settlers, but they were also likely to go to war with each other, or to join the colonists in attacking another tribe. In fact, tribes would sometimes spread rumors that other tribes were planning to attack the Europeans, hoping to encourage the colonists to bring their powerful military forces to bear against a rival tribe.

(We see similar patterns in our modern Enemy Outside, when we imagine that all the world’s Muslim terrorists are arrayed against us, an alliance of evil masterminds hiding in caves. It’s not that there aren’t Muslim terrorists, but they aren’t by any means unified, and some of the various Islamic groups have tried to manipulate us into fighting their enemies.)

Walker illustrates the Enemy Within through the witchcraft hysteria in Salem, Massachusetts. It started with accusations against an Indian slave, an obvious Enemy Outside, but soon the fear spread that almost anyone might be a witch — prostitutes, businessmen, ministers, even the governor’s wife. Many of the accusations followed preexisting animosities — business rivalries, cultural conflicts, religious differences — because if you’re going to suspect someone in your life of being a witch, it’s probably going to be someone you already have reason to dislike. And besides, an accusation of witchcraft was a good way to cause trouble for your enemies.

There was also, as the sociologist Richard Weisman has pointed out, a change in the role of the government. The typical New England witchcraft accusation involved townspeople blaming their neighbors for various mundane misfortunes. If you look past the fact that the charges involved the use of magical powers, you’ll find that the conflicts weren’t so different from the disputes that modern people have over rat-attracting junk piles, dogs that dig up gardens, or tree branches that extend into an adjoining yard. Even by the legal standards of the time, the use of malevolent magic was difficult to prove, so the New England courts were ordinarily reluctant to take on such cases.

But now the state was throwing itself into the conflict, creating a situation closer in spirit to Europe’s persecutions than to traditional tiffs between neighbors. An ordinary citizen of Salem might worry that the witches next door were poisoning his cow or making his children sick. The authorities had a grander fear: in Weisman’s words, that “an organized plot to subvert the Puritan mission had successfully infiltrated the core of the church.” Tales of vast conspiracies began to appear in the confessions.

Those confessions were easy to get, since accused witches could avoid execution by revealing the names of other witches, and the confessions led to an ever-expanding list of suspects, which raised the chilling prospect that the Enemy Within was actively recruiting conspirators, and that they might use their mysterious powers to induct your friends or even your children. These sorts of accusations have been routinely leveled against minority religious groups such as Shakers, Catholics, and Mormons.

(We can see similar Enemies Within in the anti-cult panic that followed the Jonestown massacre, or the rhetoric used to stir up oppression of fascists, communists, and homosexuals.)

The Enemy Within was also suspected to be capable of using almost every new medium to recruit. In modern times, comic books, television, video games, and the internet have all been sources of concern. Fear of manipulation through some form of mass media leads to perhaps the ultimate expression of the Enemy Within: The belief that most of the people around you are an easily manipulated mob, “sheeple,” deluded into “false consciousness,” and that only you — and a few especially intelligent people who share your views — can see the real truth.

The fear of mass culture had an authoritarian side too. It was shot through with distrust of ordinary people, who were often described in terms that suggested they weren’t fully human. Erich Fromm’s influential Escape from Freedom (1941) argued that while some of us had achieved a “genuine individuality,” monopoly capitalism had created a “compulsive conforming” in which “the individual becomes an automaton, loses his self, and yet at the same time consciously conceives of himself as free and subject only to himself.” Not every critic of mass culture would go that far, but they all contrasted the individual man with the amorphous mass.

Such ideas don’t have to lead to authoritarian conclusions. But if you see the average voter as an automaton, it’s obviously easier to support laws that might otherwise seem like restrictions on his freedom. And if you think he’s being manipulated by occult forces—advertisers, broadcasters, comic book publishers— it’s easier to rationalize those restrictions as an act of liberation.

Whereas the Enemy Within could be your neighbor, your priest, or the people teaching your children, the Enemy Below was identifiable as a particular social class. In the American colonies and the early United States, the most identifiable Enemy Below was the African slave population, who were frequently suspected of plotting an uprising to kill their white owners.

Slave escapes and revolts were real, of course, and the successful rebellion in Haiti set the slave-owning regions on high alert for signs of trouble. Rebellious slaves had often resorted to starting fires to destroy property and distract the authorities, so as far as the white population was concerned, every building that caught on fire was potentially a portent of a slave uprising. There was also concern that various shady people in rough neighborhoods were fomenting slave rebellions for dastardly reasons of their own, and during wars the slaves were often said to be working with the enemy.

(I think we can see echoes of the Enemy Below in the 1992 riots that erupted in black communities in Los Angeles. Fifty three people died and thousands were injured before military forces quieted the city. Just as slave owners couldn’t believe that slaves would spontaneously rise up, right-wing conspiracy nuts couldn’t believe that the riots were the result of poor police handling of genuine widespread outrage at the acquittal of white police officers accused of beating a black man. Rumors began to circulate that black and Hispanic street gangs had been planning the whole thing for weeks in advance so they could loot, burn, and kill.)

The opposite of the Enemy Below was the Enemy Above, the rich and powerful people who were supposedly keeping everyone else down. In the early days, predictably, the lead suspects were a cabal within the British government, intending to extinguish all liberty, starting with the colonies:

If the colonies could be subdued, one pamphleteer warned, the plotters “might open their batteries with safety against British Liberty; and Britons be made to feel the same oppressive hand of despotic Power.” The alarm was sounded: “a PLAN has been systematically laid, and persued by the British ministry . . . for enslaving America; as the STIRRUP by which they design to mount the RED HORSE of TYRANNY and DESPOTISM at home.”

(Apparently, even back then, ALL CAPS was a bit of a warning sign.)

The secret plan, John Adams explained, was to “establish the Church of England, with all its creeds, articles, tests, ceremonies, and tithes, and prohibit all other churches.” When the Stamp Act of 1765 imposed a tax on printed paper , Joseph Warren of Massachusetts announced that the law had been “designed . . . to force the colonies into a rebellion, and from thence to take occasion to treat them with severity, and, by military power, to reduce them to servitude.” The Boston Massacre of 1770, the Tea Act of 1773, the Intolerable Acts of 1774: All were evidence of the dark design. One isolated act of oppression “may be ascribed to the accidental opinion of a day,” Thomas Jefferson acknowledged, but America was undergoing “a series of oppressions, begun at a distinguished period and pursued unalterably through every change of ministers.” And that meant it faced “a deliberate and systematical plan of reducing us to slavery.”

If you were to poll the founding fathers, you would hear slightly different accounts of who was a part of this conspiracy and what exactly the conspirators were up to. But when it came to where the enemy was taking them, they agreed with Jefferson. George Washington wrote that “a regular Systematick Plan ” threatened to reduce the colonists to “tame, & abject Slaves, as the Blacks we Rule over with such arbitrary Sway.” Alexander Hamilton concurred: A “system of slavery,” he said, was being “fabricated against America.” When the revolutionaries formed a Continental Congress, the body denounced the “ministerial plan for enslaving us” and issued a warning to the people of Great Britain: “May not a ministry, with the same armies, enslave you?” When the colonies declared independence, the plot against America was detailed in the new country’s founding document. The Declaration of Independence did not merely describe “a long train of abuses and usurpations.” It argued that those abuses added up to “a design” to bring the colonists “under absolute Despotism.”

Again, as is often the case, the conspiracy theory was not entirely based on fiction. The British did, after all, rule over the colonies. But perhaps their ultimate goal was something less than total enslavement. (The British and their American loyalists suspected a mysterious cabal was behind the rebellion in the colonies. And that the French might be behind it .)

Other Enemies Above included the Masons, the Illuminati (but of course!), and bankers. Leading up to the Civil War, northern Republicans saw the hand of the Slave Power behind behind every setback. After the war, the KKK loomed larger than life in the nightmares of freed blacks. In more modern times, some people blame all political opposition on either George Soros or the Koch brothers.

Throughout the historical section of the book, certain themes seem to emerge:

  • Conspiracy theories often have a basis in reality: Indians really did attack the colonies, rich people really do have undue influence in the government, slaves really did rise up against their masters.
  • The conspiracies tend to imagine a much greater degree of coordination than is actually evident: That the Indians have a secret king, that all those fires can’t just be random accidents, and that people seeking political change must be serving a hidden master.
  • The conspiracies tend to imagine very ambitious goals: The European royals don’t just want to rule the colonies, they intend to destroy all freedom, and the witches aren’t just hexing people they don’t like, they’re destroying the foundations of the church.
  • The conspiracy tends to deny the agency or legitimacy of the enemy: The slaves aren’t unhappy, they’re being goaded into rebellion by outside forces, and the workers demanding unions are just following the commands of their communist paymasters.
  • The conspiracy theorists often imagine that an entire religious group or immigrant community could live among us for years or decades for purposes of enacting a secret agenda when the right moment arises.
  • The conspiracy is often declared to simultaneously be (a) vast and far-reaching and yet (b) hidden so well that we can only surmise its existence indirectly, unless we coerce people into confessing their complicity and naming co-conspirators.
  • The enemy — whether above or below, inside or outside — always, always wants our women.

Having laid the historic foundation, the rest of the book explores some modern conspiracy movements. It’s a longer section, but if you’ve been around a while, the conspiracies are mostly pretty familiar: Super-secret government programs, the CIA, MK Ultra and COINTELPRO, the Illuminati and the Rothschilds, the Weavers and the McMartins and the whole Satanic Ritual Abuse panic. There’s also the whole extremely weird discordian movement, which deservedly gets a chapter of its own.

(The militia movement alone has a fascinating history. Vaguely organized around a opposition to  federal power, globalization, and/or the militarized police state, the movement included racists opposed to government equal rights policies, but the militia movement also included blacks and Jews, which often brought condemnation from white supremacists. Various militia groups have opposed the Rodney King beating, they’ve reported attempts to bomb gay bars and abortion clinics, and they’ve infiltrated police groups to expose racist behavior. That didn’t stop militia opponents from manufacturing their own conspiracy theories about what the militias were really all about, and it didn’t stop people from smearing their opponents with accusations of ideological affiliations with militias. The resemblance to witch hunts, Red Scares, and, well, a lot of modern politics, is not coincidental.)

By the end of the book, Walker has caught up to the present day, and the internet has put every conspiracy theory just one Google search away from anyone who’s curious, and which has led to a confusing mishmash of conspiracies — crop circles one day, CIA brainwashing the next, followed by the latest news on the Zionist conspiracy. And so now we have black nationalists who’ve adopted sovereign citizen theories that originated with the white power patriot movement.

The events of 9/11 were, of course, the result of a genuine conspiracy, but they also added fuel to the fire and touched off paranoid conspiracy theories about Muslim fifth columnists. As with the witch trials, these theories affected the government, leading to conspiracy-driven policies about how much liquid we can carry on planes and official paranoia about photography at a time when everyone in the country was about to start carrying small digital cameras.

Somewhere along the way, historians started to collect conspiracy theories and trace their origins. Soon people started collecting conspiracy theories and trading them like baseball cards, mixing the historic with the modern and the made-up-just-for-fun.

Which is, I guess, where Jesse Walker comes in.

One final note: While United States of Paranoia is a book about conspiracy theories, it’s also very much a book about telling stories that grab people’s imaginations. If you’re a novelist or screenwriter working on a series of stories, and you need to construct a compelling enemy, one that is at once secretive and powerful, then United States of Paranoia is an excellent guide. As H. P. Lovecraft says in the epigram that opens the eighth chapter, “No weird story can truly produce terror unless it is devised with all the care & verisimilitude of an actual hoax.”

2013 Road Trip Report – Part 3: Connecticut

Time for Part 3 of my rambling road trip report from last summer. Part 1 ended in Toledo, Ohio and Part 2 ended in Wilkes-Barre, Pennsylvania.

I got up the next morning and took advantage of the complimentary breakfast before heading out on the road. There was some decent weather, so I pulled off the road to setup the GoPro again. This time I wedged it in place in the moonroof, and drove from one exit to the next. I discovered that it only got about 10 seconds before it stopped. I tried it a few more times, and that’s all it did: Record for about 10 seconds and stop. A little internet research at the next rest stop told me that the memory card I was using was too slow. It was only class 4 and I needed class 10.

(Why did it work the first time? I think I may have had it set to a lower resolution than full 1080. Why did Target sell it to me with a GoPro HERO3 if it won’t work? I’m not sure, but perhaps it’s good enough for the White Edition they were selling.)

I spent the rest of the afternoon driving to the Hyatt House in Shelton, Connecticut, just outside of New Haven. It’s a nice place.

I let Gideon know that I was there, and he got in touch with Norm Pattis, and they figured we should eat around 6:15 at Sally’s Apizza, although Gideon said he thought Frank Pepe’s just down the block was better.

I still needed to get a class 10 MicroSD card for my GoPro camera. I looked around for electronics and office supply stores, and there were a few in the area, but although I was sure they would have MicroSD cards, I couldn’t be sure they’d have the high-quality class 10 variant. (Calling them would probably be an exercise in frustration and perhaps being lied to.) I decided to look for professional photography stores, because pro photographers worry about things like memory card quality and transfer rate.

It turned out that I could stop at Milford Photo without adding more than a few minutes to my drive downtown. The gentleman who helped me there instantly knew exactly what I wanted, and why, and he had them in stock in several sizes. I bought a 32GB card, and while he was ringing it up we got into a discussion of whether anybody really needed all those pixels you get in modern high-end cameras. We both agreed they seemed unnecessary, except for some special cases. Having bonded over this issue, I left satisfied at maybe finally solving the GoPro problem.

By the time I got to the pizza place, Gideon had called and said something about Sally’s looking like it was closed so we should just go to Pepe’s. I parked in Pepe’s lot, all the way in back, and went to the end of the line of people waiting to get in. I started looking around to see if I could spot them.

Gideon had only given me a very brief description of himself, but I had seen pictures of Norm (although I’m bad enough with faces that that doesn’t really help). I saw a man in a suit across the street who looked like he might have the requisite pony tail. And there was a guy ahead in line who might have matched Gid’s description, but when he looked at me, he showed no signs of recognition. (My photo is on my blog, so Gid should recognize me.) Then I saw the Norm-looking guy cross the street to meet another guy coming toward us who kind of matched Gid’s self-description. I walked over and introduced myself.

I had originally planned to take some photos — with Gid’s face appropriately obscured by random objects to protect his anonymity — but never got around to it. For the record, Norm looks a lot like his photos, except in real life he’s a lot more vibrant. (His photographer does great work, so I don’t know what the problem is.) As for Gideon, he needs to remain anonymous, so I don’t want to give too much away…let’s just say that in appearance he’s somewhere between DJ Qualls and Henry Cavill.

We got back in line and went inside to get some pizza. I can’t remember the details of the conversation, but Norm and Gid spent a lot of time talking about local cases and issues, which was kind of fascinating to a legal spectator like me. The pizza was decent too. Norm had just won some sort of big case, so he picked up the tab, thus forever earning my gratitude.

(Hmm… Norm and Gid wanted to eat at different restaurants, and after some discussion we ended up eating where Gid wanted, but Norm paid. I’m not sure, but I think that means Gideon is the better lawyer.)

When I got back to my hotel, I saw some kind of fire truck and about a dozen firefighters gathered in front. I spent a minute watching from a distance — if something was happening, I wanted to stay out of the way — but they weren’t wearing turnout gear and it looked like a senior firefighter was lecturing the rest of them. I guess it was a familiarization exercise of some kind, perhaps to discuss how to fight hotel fires, or perhaps to learn their way around that building when it wasn’t on fire.

Anyway, I got back to my room a little before 9pm, and I tried to figure out what to do for the rest of the evening. At least that’s the last thing I remember before I fell asleep.

Fourth Annual Windypundit Coastal Dash: This Time It’s Backwards

For the fourth year in a row, I’ll be making a road trip to the east coast. This time, however, I’ll be going in the opposite direction from my usual pattern: I’ll be heading down into Kentucky on the way out before going up to Avalon, New Jersey for a few days at the shore.

As usual, it would be great to meet up with some of you along the way. So far I’ve managed to visit with Jennifer Abel, Jeff Gamso, Mirriam Seddiq, Norm Pattis, and Gideon. (Yeah, that’s right, I know Gideon’s secret blogger identity!) It would be nice to meet a few more of you — or see some of you again. So if you’re interested, and you can accommodate our somewhat unpredictable driving schedule, let me know soon.

Don’t worry if you’re not on the route on the map. Our plans are still pretty loose and the map is just a rough guess — we could easily veer off hundreds of miles in any direction. On the other hand, we’ll be making it up as we go along, so it’s a little hard to say exactly what days we’ll be where. (Except for my cousin Mallory’s wedding, which we do plan to get to on time, even though we still haven’t received our invitations, but the mother of the bride promises me we’re invited. It’s a bit of a scandal, if you ask me.) We’ll have a better idea of the schedule once we’re underway.

Email me for details if you’re interested: [email protected]

2013 Road Trip Report – Part 2: The Zen of Driving

Time for Part 2 of my rambling road trip report from last summer. Part 1 ended with me going to sleep outside Toledo. The next morning I woke up and hit the road: Interstate 80 eastbound. This was to be my longest drive of the trip, just over 450 miles to Scranton, Pennsylvania. With a reasonable number of stops for a break along the way, it’s not exactly grueling.

At the first stop, I decided to try out my new GoPro video camera. My wife had given it to me for Christmas, and I haven’t been able to find time to play with it. I wanted to use it to capture some of the drive, since still photos don’t really capture the experience.

So I tried setting it up and…problem: The camera reports an SD error whenever I try to start recording. That means it can’t save the video to the MicroSD memory card. I could presumably buy another MicroSD card anywhere, but was that really the problem? Or was the it the camera that was malfunctioning by being unable to access memory cards. Since I have limited time on this trip, I decided to try it both ways.

When I stopped for lunch at one of the tollway rest stops, I got on the WiFi and found out from the GoPro website that Target carries their cameras. I found a Target at the next exit and went the the camera section, where I bought both a 16GB MicroSD memory card (with adapter) and a new GoPro HERO3 White Edition camera. My plan was to try out the memory card in my current camera and if that didn’t work, open the box on the new camera and use that.

I decided to make a little headway before fooling around with it any more, but at a later rest stop I decided I’d driven far enough to take a break and try the GoPro again. The camera didn’t seem to hate the new MicroSD card, so I mounted it on the inside of the window with a suction cup, turned it on, and drove to the next rest stop, where I removed it. I was planning to take a few more test shots and look at them in the hotel.

All this time I had been driving across Ohio, and let me tell you this: Interstate 80 through Ohio is really boring. Eastern Ohio is flat and uninteresting driving, and it’s a limited-access toll road, where all the rest stops are the same.

And then there’s the road construction. It didn’t create traffic jams, but in every construction zone the official speed limit on I-80 dropped from 70 miles per hour to 55. And it seemed like everything was under construction. Just as I’d be getting into the rhythm of 70 mph traffic, we’d hit another construction zone and have to slow down, crawling along on roads designed for much higher speeds. Then I’d see those magic words “End Work Zone” and finally get to speed up again…until I hit the next construction zone. At one point, as I was passing the “End Work Zone” sign, I could already read the “Reduce Speed” sign where the next construction crew had set up.

Somewhere On the Road

Just past Youngstown, as it began to get darker, I caught up to the storm again — or at least I caught up to a storm of some kind — which put an end to my video experiments. (The GoPro housing is weatherproof, but that doesn’t keep raindrops from obscuring the view.) I then crossed over into Pennsylvania and spent the next next 6 hours driving on unfamiliar winding mountain roads, in the rain, surrounded by trucks. About half of it at night.

And I loved it. I’ve always enjoyed driving. I find it…not relaxing, exactly. But I like the feeling of focus that comes from a long drive. I’ll be cruising along in the right-hand lane and I’ll start to creep up on a truck, so I flip on the left turn signal, change lanes, pass it, signal again, and move back to the right. Problem solved.

A few minutes later, I’m creeping up on another truck, but a third truck is overtaking me at the same time. It looks like it will want to pass me about the same time I’m trying to pass the truck in front of me, and that won’t work on a two-lane road. I could just slow down, let the overtaking truck pass me, and then follow him around the truck in front of of us. Or I could speed up and pass the truck in front, and then let the overtaking truck pass us both. Whatever I decide, I just do it and move on.

About an hour after it gets dark, I’m rolling through the night on cruise control, on a straight piece of road, with trucks about a quarter mile ahead and behind me. I’m just enjoying the ride. Then the truck ahead of me gets my full attention as its hazard flashers come on. That would makes sense if it was coming to a stop. At night, in the rain, it’s hard to judge distance, and a following vehicle might not be able to tell if a vehicle far ahead has stopped, so truckers often do this. I now watch carefully, and I after a few seconds I can tell I’m gaining, so I begin slowing down.

Now I have to make sure the trucker behind me knows I’m stopping, so I flip on my hazard flashers, and a few seconds later I see his hazard flashers start up. And just like that, we all come to an orderly stop and then begin crawling forward slowly. After a few minutes, vehicles in front of me start merging left, and I can see lights flickering from an emergency vehicle ahead. A minute later, I pass a police car that is blocking the right lane because the storm has blown down a tree across most of it. A few seconds after that, we’re all accelerating to 65 mph again.

Winding roads, trucks, poor visibility, police cars, and fallen trees. There’s nothing complicated about any of it, nothing requiring long-term thinking. I just have to stay focused and pay attention. It’s a continual series of small problems that I can solve one after another, never looking back, never planning more than a minute or two ahead.

The Best Western Plus East Mountain Inn & Suites in Wilkes-Barre, Pennsylvania
Best Western Plus East Mountain Inn & Suites

Eventually I arrive at my hotel in Wilkes-Barre, the Best Western Plus East Mountain Inn & Suites, which was hidden back from the road a bit. It had bell carts, so I had an easier time getting everything up to my 4th floor room. I farted around on the internet a bit — again after having to ask the front desk for the password (why don’t they just put it on a note in the room?) —  before falling asleep.

Finally, here’s a sample of the video I got while I was driving through. This was just an experiment, so there’s no real point to it, and mounting the camera inside the car leaves too much of the dashboard visible. But I need to get more experience editing, so here goes. Best viewed full-screen to see the super-wide angle from the GoPro:

5 Years of the Business Cycle

I’ve been seeing this chart meme in a few places lately:

The URL at the bottom indicates it’s from the folks at “I love it when I wake up in the morning and Barack Obama is President.” I’m assuming the numbers are accurate. There’s no date on it, but with that Dow number it has to be fairly recent.

Economic recessions are, by definition, deviations from the norm. The economy is humming along, everybody is working, output is growing a little every year…and then something goes wrong. For some reason, the economy slows down. People want to work, but they can’t find jobs, even though offices and factories sit empty and ready for use. Somehow the economy loses efficiency, the market no longer links up jobs and capital with customers. Output falls, consumption falls, and people suffer. Why exactly it happens is the subject of some controversy — there are several major theories — but recessions are part of the business cycle, and the economy eventually works its way back to its normal state of employment and growth. There may or may not be much the government can do to help with that (again, there are several theories).

Barack Obama took over the Presidency while the United States was in the midst of a deep depression caused by the mortgage crisis. The recession ended, and the economy improved. Just like it always does when a recession ends. So it’s not clear to me that President Obama should really be given credit for the economic growth depicted in the 5 Years of Obama meme, unless you want to give him credit for ending the recession. And if you do give him credit for ending the recession, you also have to hold him responsible for how long it took:

Change in U.S. Non-Farm Employment in Post-WWII Recessions

This has been the longest and deepest post-war recession in terms of the employment rate. The same is true when you look at production:

Change in U.S. Real GDP in Post-WWII Recessions

You might argue that Obama isn’t responsible for the depression, since that started during George W. Bush’s presidency. In that case, Obama reigned over one of the slowest recoveries:

Change in U.S. Non-Farm Employment in Post-WWII Recoveries

Change in U.S. Real GDP in Post-WWII Recoveries

I don’t know how much President Obama can really affect the business cycle, but if he’s responsible for it, he hasn’t been doing a very good job. Those are the pesky facts.

(Charts are from the Federal Reserve Bank of Minneapolis, The Recession and Recovery in Perspective.)

Selfish Billionaires

Divid Sirota at In These Times has a mind-boggling complaint about rich people:

[...] Facebook’s Mark Zuckerberg announced a $120 million donation to San Francisco-area schools. That donation came only a few years after California considered a ballot measure to increase funding for its schools. Zuckerberg was notably absent from the campaign to pass the measure.

That detail is germane to Gore’s point about charity and democracy. Indeed, there seems to be a trend of billionaires and tech firms making private donations to public institutions ostensibly with the goal of improving public services. Yet, many of these billionaires are absent from efforts to raise public resources for those same institutions. Zuckerberg is only one example.

For instance, hedge funders make big donations to charter schools. Yet, the hedge fund industry lobbies against higher taxes that would generate new revenue for education.

Likewise, there are the Koch Brothers, who simultaneously finance the nationwide anti-tax movement while making huge donations to public institutions.

Meanwhile, Microsoft boasts about making donations to schools, while the company has opposed proposals to increase taxes to fund those schools.

The selfish bastards! They’re willing to donate huge amounts of their own money to causes they care about, but they don’t want to force other people to support those causes! That’s just how evil they are!

How the Real Professional Human Traffickers Do It

A couple of weeks ago Somaly Mam resigned from the anti-human-trafficking foundation that used to bear her name. (Apparently, it’s changing its branding from the Somaly Mam Foundation to just SMF.) It turns out she had been lying about important parts of her life story, including the part about being sold into forced prostitution. She also claimed to have rescued young women who told harrowing stories of sexual slavery, and a lot of that turned out to be lies as well, as recounted in a Newsweek cover story by Simon Marks:

Interviews with Mam’s childhood acquaintances, teachers and local officials in the village where she grew up contradict important, lurid details in her autobiography. Many of the villagers in Thloc Chhroy say they never met or even saw Mam’s cruel “Grandfather,” the rich Chinese merchant who allegedly raped her or the violent soldier she says she was forced to marry.

Not even Mam can keep the story straight. In February 2012, while speaking at the White House, she said she was sold into slavery at age 9 or 10 and spent a decade inside a brothel. On The Tyra Banks Show, she said it was four or five years in the brothel. Her book says she was trafficked when she was “about 16 years old.”

[...]

Another of Mam’s biggest “stars” was Meas Ratha, who as a teenager gave a chilling performance on French television in 1998, describing how she had been sold to a brothel and held against her will as a sex slave.

Late last year, Ratha finally confessed that her story was fabricated and carefully rehearsed for the cameras under Mam’s instruction, and only after she was chosen from a group of girls who had been put through an audition. Now in her early 30s and living a modest life on the outskirts of Phnom Penh, Ratha says she reluctantly allowed herself to be depicted as a child prostitute: “Somaly said that…if I want to help another woman I have to do [the interview] very well.”

In light of these revelations, the cover of that edition of Newsweek asks the question,

Somaly Mam saved countless girls in Cambodia. Does it matter that parts of her story aren’t true?

Anne Elizabeth Moore provides the answer to that question in her piece at Salon (Yes, it does.) and along the way she touches on an important truth: Small-time criminals break the rules. The biggest criminals make the rules.

By way of illustration, one of the classic failures of the free market occurs when businesses collude to gain monopoly power over their customers. This can happen when a group of suppliers agree to divide up the market between them, or when companies form a cartel in which they agree to gang up on customers rather than competing against each other. By working together instead of against each other, businesses can extract a lot more money from their customers than they would if they competed in the free market.

These sorts of trade-restraining deals are not easy to pull off, however. For one thing, they’re pretty much illegal in the United States, and the U.S. Department of Justice has an Antitrust Division which enforces the laws against cartels and monopolies.

Cartels are also difficult to operate in the real world. Even if they’re legal, the members of the cartel usually figure out very quickly that if everyone else is committed to high prices or low production, they can greatly increase their market share by offering more product at lower prices. Furthermore, new businesses will spring up to take advantage of the high prices by offering the same services as existing companies, but at a discount, so they can grab some market share. For these reasons, it’s not uncommon for cartels to collapse almost immediately into a competitive race to the bottom.

At least that’s the case when the cartel members are the kind of people you read about in newspaper stories — shady characters meeting in smoky back rooms and Las Vegas hotels to rig bids, fix prices, and divide up markets. These guys are small-time monopolists, or at they very least they’re inexperienced at it.

The serious, experienced, big-money cartels don’t have to hide from the government and worry about who might be cheating. They have a much better strategy for monopolization that gets around anti-trust laws and prevents cheating: They get the government itself to create and enforce the cartel.

If taxi company owners tried to get together to artificially limit the number of taxis in operation to drive up prices, it would never work. For one thing, they’d be prosecuted for anti-trust violations. But probably even before government investigators figured out what they were up to, their cartel would be undermined by new taxi companies created by people who noticed the high prices and decided they wanted to get in on the action. They would quickly bid down prices and compete away most of the monopoly profits.

On the other hand, if the taxi companies can get the city government to artificially limit the number of taxis through a medallion licensing system, then the antitrust lawyers at the DOJ would ignore their arrangement, and they would be able to get the city police department to enforce their cartel by ticketing or arresting unlicensed cabbies. It’s a very sweet deal, and it’s the reason taxi medallions often trade for hundreds of thousands of dollars.

Similarly, if hospital operating corporations in a state colluded to raise prices by limiting the availability of hospital beds and facilities, there would be hell to pay. Reporters would investigate them, Congress would launch hearings, and the DOJ Antitrust Division would land on them like a ton of bricks. But when hospitals get health care agencies in 35 states to require a “Certificate of Need” — demonstrating that there is “unmet need” in the market — before new hospitals can be built or existing hospitals can be expanded, the DOJ and Congress and most of the journalists remain silent about it, and hospitals continue to earn huge profits.

Of course, nobody involved ever admits that these laws are about increasing profits for those who are politically well-connected. There’s usually some pretense that the laws are promoting the public good. Taxi medallion laws are usually sold to the public as protecting consumers from unscrupulous cab operators or reducing taxi congestion in downtown areas. The hospital “Certificate of Need” rules are supposed to prevent expensive and wasteful “excess capacity” that somehow drives up health care costs.

In a similar way, at least some of the ongoing moral panic about “human trafficking” seems to be a pretense to hide less worthy motives. To be sure, human trafficking is a real problem, and organizations like SMF and other anti-trafficking NGOs do rescue some people from bondage. But as Marks made clear, there were a lot of lies, and as Moore makes clear, there’s more going on:

I visited one such NGO in Phnom Penh in January — not run by Mam, but built on the attention she’s brought to the issue since 2007. What I saw was not shocking: totally normal Cambodian women in a large room, sewing apparel. But it wasn’t social services, either: It was a garment factory. [...]

Ending deeply embedded misogynistic practices, including both sex trafficking, which is likely rarer than Mam admits, and the policies supposedly waging war against it, is not an effortless gig. I’ve nonetheless heard several students expressing the desire to get into the brothel-busting game themselves. Listen: I spent seven years researching and doing work in Cambodia, made concerted efforts to learn the language, developed a strong stomach and reliable sources, and honed my skills in investigative reporting before I could even understand what, really, anti-human trafficking NGOs do. What they do is normalize existent labor opportunities for women, however low the pay, dangerous the conditions, or abusive an environment they may be. And they shame women who reject such jobs.

[...] Massive strikes in recent years have seen demand grow for an increase in pay, although other jobs for women remain few and unregulated. Among them, work in the sex industry is both reliable and flexible enough for, say, working moms. [...] Most women in Cambodia live under conditions of poverty and desperation, and the garment industry’s insistent refusal to meet living-wage standards ensures this will continue for some time. Still, garment workers know an entire international trade system relies on their willing participation, which was how they built such a strong showing in the last elections. The big brands know it too, which is why the Nike Foundation funds Half the Sky — as do other multinationals that both enforce, and rely on, women’s desperate poverty around the world.

What anti-trafficking NGOs are saving women from, in other words, is a life outside the international garment trade, which, according to folks who sell us our clothes, is no kind of life at all — even though folks in those jobs tell me they can barely survive. About one-seventh of the world’s population of women works in the garment industry, which very rarely pays more than half a living wage (including to folks who work fast fashion retail in U.S. urban centers). This helps keep women in poverty around the globe.

In other words, the human traffickers that SMF and the other NGO’s are fighting, the guys who grab children off the streets, who smuggle them across borders in containerized shipping, who operate slave brothels, they’re like the business owners meeting in back rooms: They’re the little guys. The amateurs.

The serious professional human traffickers in the garment industry don’t need to do any of that. They’ve co-opted governments to steer women into their industry, and they fund NGOs that capture those who try to escape and re-educate them for garment work, all while claiming to be “rescuing girls.” This is how the serious human traffickers get things done. They turn their crimes into government policy and into respectable-seeming social welfare organizations.

css.php