The Real Roots of American Rage

Soon after the snows of 1977 began to thaw, the residents of Greenfield, Massachusetts, received a strange questionnaire in the mail. “Try to recall the number of times you became annoyed and/or angry during the past week,” the survey instructed. “Describe the most angry of these experiences.” One woman knew her answer: Recently, her husband had bought a new car. Then he had driven it to his mistress’s house so she could admire the purchase. When the wife found out, she was livid. Furious. Her rage felt like an eruption she couldn’t control. (...)

Other replies soon began flooding his mailbox, so many that Averill had trouble reading them all. “It was the best-performing survey I’ve ever conducted,” he told me. “Some people even attached thank-you notes. They were so pleased to talk about being angry.”(...)

Other respondents described more mundane arguments, over who ought to take out the trash, or curfews for teenagers, or snappish tones at the dinner table. People were eager to talk about their daily indignations, in part because they felt angry so frequently. “Most people report becoming mildly to moderately angry anywhere from several times a day to several times a week,” Averill later wrote, summing up his research in American Psychologist.

Most surprising of all, these angry episodes typically took the form of short and restrained conversations. They rarely became blowout fights. And contrary to Averill’s hypothesis, they didn’t make bad situations worse. Instead, they tended to make bad situations much, much better. They resolved, rather than exacerbated, tensions. When an angry teenager shouted about his curfew, his parents agreed to modifications—as long as the teen promised to improve his grades. Even the enraged wife’s confrontation with her unfaithful husband led to a productive conversation: He could keep the mistress, as long as she was out of sight and as long as the wife always took priority.

In the vast majority of cases, expressing anger resulted in all parties becoming more willing to listen, more inclined to speak honestly, more accommodating of each other’s complaints. People reported that they tended to be much happier after yelling at an offending party. They felt relieved, more optimistic about the future, more energized. “The ratio of beneficial to harmful consequences was about 3 to 1 for angry persons,” Averill wrote. Even the targets of those outbursts agreed that the shouting and recriminations had helped. They served as signals for the wrongdoers to listen more carefully and change their ways. More than two-thirds of the recipients of anger “said they came to realize their own faults,” Averill wrote. Their “relationship with the angry person was reportedly strengthened more often than it was weakened, and the targets more often gained rather than lost respect for the angry person.”

Anger, Averill concluded, is one of the densest forms of communication. It conveys more information, more quickly, than almost any other type of emotion. And it does an excellent job of forcing us to listen to and confront problems we might otherwise avoid.

Subsequent studies have found other benefits as well. We’re more likely to perceive people who express anger as competent, powerful, and the kinds of leaders who will overcome challenges. Anger motivates us to undertake difficult tasks. We’re often more creative when we’re angry, because our outrage helps us see solutions we’ve overlooked. “When we look at the brains of people who are expressing anger, they look very similar to people who are experiencing happiness,” says Dacher Keltner, the director of the Berkeley Social Interaction Lab. “When we become angry, we feel like we’re taking control, like we’re getting power over something.” Watching angry people—as viewers of reality television know—is highly entertaining, so expressing anger is a surefire method for capturing the attention of an otherwise indifferent crowd.

In the years after his survey, Averill watched as anger studies became the focus of academic specialties and prestigious journals. In 1992 alone, social scientists published almost 25,000 studies of anger.

Then, in early 2016, Averill was watching newscasts about the presidential primaries. The election season had barely started, and the Republican field was still crowded. Governor Nikki Haley of South Carolina, giving the Republican rebuttal to President Barack Obama’s final State of the Union address, took a subtle jab at one of her party’s candidates—a clownish figure the establishment hoped to marginalize.

“During anxious times, it can be tempting to follow the siren call of the angriest voices. We must resist that temptation,” Haley told voters. “Some people think that you have to be the loudest voice in the room to make a difference. That’s just not true.”

Soon afterward, reporters swarmed Donald Trump to ask how he felt about such a public renunciation. “Well, I think she’s right, I am angry,” Trump told CNN. “I’m angry, and a lot of other people are angry, too, at how incompetently our country is being run.” Trump continued: “As far as I am concerned, anger is okay. Anger and energy is what this country needs.”

As Averill watched, he felt a shock of recognition. Everyone believed Trump would be out of the race soon. But Averill wasn’t so sure. “He understands anger,” he thought to himself, “and it’s going to make voters feel wonderful.”

***

America has always been an angry nation. We are a country born of revolution. Combat—on battlefields, in newspapers, at the ballot box—has been with us from the start. American history is punctuated by episodes in which aggrieved parties have settled their differences not through conversation, but with guns. And yet our political system was cleverly designed to maximize the beneficial effects of anger. The Bill of Rights guarantees that we can argue with one another in the public square, through a free press, and in open court. The separation of powers forces our representatives in government to arrive at policy through disagreement, negotiation, and accommodation. Even the country’s mythology is rooted in anger: The American dream is, in a sense, an optimistic reframing of the discontent felt by people unwilling to accept the circumstances life has handed them.

Recently, however, the tenor of our anger has shifted. It has become less episodic and more persistent, a constant drumbeat in our lives. It is directed less often at people we know and more often at distant groups that are easy to demonize. These far-off targets may or may not have earned our ire; either way, they’re apt to be less invested in resolving our differences. The tight feedback loop that James Averill observed in Greenfield has been broken. Without the release of catharsis, our anger has built within us, exerting an unwanted pressure that can have a dark consequence: the desire not merely to be heard, but to hurt those we believe have wronged us.

We have learned a great deal about anger since Averill began studying it, and for all its capacity to improve our lives, it can also do great harm. The scholarship of Averill and his successors shows how ordinary anger can be sharpened, manipulated, and misdirected—and how difficult it is for us to resist this process. Under certain conditions, the emotion can transform from a force that helps keep society knitted together into something that tears it apart.

by Charles Duhigg, The Atlantic |  Read more:

Image: The Atlantic

Congress May Have Fallen for Facebook’s Trap, but You Don’t Have To

In recent weeks, Facebook confronted yet another privacy scandal, in light of leaked court documents suggesting that its staff discussed the idea of selling user data as long ago as 2012. Facebook's director of developer platforms and programs, Konstantinos Papamiltiadis, responded, “To be clear, Facebook has never sold anyone’s data.” It was the same denial that Mark Zuckerberg issued before the Senate in April 2018: “We do not sell data to advertisers. We don’t sell data to anyone.”

As a data scientist, I am shocked that anyone continues to believe this claim. Each time you click on a Facebook ad, Facebook sells data on you to that advertiser. This is such a basic property of online targeted advertising that it would be impossible to avoid, even if Facebook somehow wanted to.

Or even better, let Mr. Zuckerberg explain, as he did to the Senate in April: “What we allow is for advertisers to tell us who they want to reach, and then we do the placement. So, if an advertiser comes to us and says, ‘All right, I am a ski shop and I want to sell skis to women’ … we can show the ads to the right people without that data ever changing hands and going to the advertiser.”

Let’s take a closer look at Mr. Zuckerberg’s ski shop example. The ski shop pays Facebook to show a targeted ad to women and sends the women to the ski shop’s website if the women click on the ad. Mr. Zuckerberg describes this process as showing “the ads to the right people without that data ever changing hands and going to the advertiser.” But this isn’t true: If a ski shop pays Facebook to show an ad only to women, then Facebook automatically reveals to the ski shop that all people who clicked on the link must be women.

And in practice, the advertisers make requests that are much more nuanced. They may ask Facebook to show their ad to “liberal Latina women without college education who live in San Antonio and recently got married.” And then they might place a separate ad that is shown only to “conservative African-American women with college educations who live in Austin and are single.” When you click on an ad and are sent to an advertiser’s website, the advertiser knows which ad you saw and thus which bucket you fall in.

Facebook has a lot of data on their users and is eager to monetize it. The advertisers are encouraged to selectively target people according to a mind-boggling range of personal characteristics. Some, such as age, gender or location, are not overly intimate. Others, such as your political views, family size, education, occupation, marital status or interest in a gay dating app, are highly personal.

Facebook would even let advertisers target you based on facts that you may not be aware of, such as that you are a close friend of a soccer fan or of someone who got recently engaged. In a recent study we published, my colleagues and I discovered that advertisers can target users based on their intimate psychological traits, such as personality. If you can think of an important personal characteristic, there’s a good chance it’s targetable on Facebook. Through this ad-targeting system, Facebook discloses facts about you to advertisers, in exchange for money, every time you click on an ad. I’d call that “selling data,” and I bet that you would, too.

But Facebook is extremely clever at dodging this issue. When the company argues that it is not selling data, but rather selling targeted advertising, it’s luring you into a semantic trap, encouraging you to imagine that the only way of selling data is to send advertisers a file filled with user information. Congress may have fallen for this trap set up by Mr. Zuckerberg, but that doesn’t mean you have to. The fact that your data is not disclosed in an Excel spreadsheet but through a click on a targeted ad is irrelevant. Data still changes hands and goes to the advertiser.

Facebook's claiming that it is not selling user data is like a bar’s giving away a free martini with every $12 bag of peanuts and then claiming that it’s not selling drinks. Rich user data is Facebook’s most prized possession, and the company sure isn’t throwing it in for free.

Importantly, this problem is not limited to Facebook. Other Big Tech companies, including Google and Amazon, have similar ad platforms. If a platform can be used to target specific users, then it reveals those users’ data. The advertiser could easily create its own data file based on this information, or merge the information with any other data it has on a customer.

The potential for abuse is obvious. As we suspected in 2016, plenty of groups buy Facebook ads to cause trouble or sow discord, rather than “merely” to sell you things. If advertisers can effectively buy data about Facebook users in the manner I’ve described, they can discriminate or target propaganda ever more effectively — both inside and outside the Facebook advertising ecosystem. They could even take the information they’ve gleaned from Facebook, combine it with advanced machine-learning algorithms and build predictive models for other sensitive traits, like religious and political views, personality, intelligence, sexual orientation, happiness, use of drugs or parental separation.

by Michal Kosinski, NY Times | Read more:
Image: Nicolás Ortega

Shiseido Lemon Cold Cream and Vanishing Cream advertisement (1933).
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Paul Cirigliano
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Kelly Slater’s Shock Wave

The best surfer in history made a machine that creates perfect conditions on demand. Will his invention democratize surfing or despoil it?

The first few hours I spent at the W.S.L. Surf Ranch, a wave pool built for surfing in the farmlands south of Fresno, California, were for me a blur. I was fine on arrival, hiking through a little forest of scaffolding, eucalyptus, and white tents with a publicist from the Kelly Slater Wave Company, which built and runs the place. The valley heat was fierce but dry. House music rode on a light northwest breeze. We passed a bright-red antique row-crop tractor parked on wood chips. Then I looked to my right and felt my mind yaw. The wave was probably six hundred yards away, a sparkling emerald wall, with a tiny surfer snapping rhythmic turns off the top. I had come expecting to see this wave, out here in cotton fields a hundred-plus miles from the coast. Still, my reaction to it was involuntary. Kelly’s Wave, as it’s known, seems designed to make someone who surfs, which I do, feel this way: stunned, turned on, needy. Surfers spend much of their lives looking for high-quality waves. Now a machine has been invented that churns out virtually flawless ones on command. “We call it the smile machine,” someone, possibly the publicist, said. I had trouble paying attention. Every four minutes, I had to turn and crane to watch a wave make its way the length of the pool.

Kelly Slater, who is forty-six, is the best surfer in history. He’s won eleven world titles. He was the youngest-ever world champion and the oldest-ever world champion. When he stormed into the competitive spotlight, in the late eighties, I couldn’t understand what he was doing. He seemed to be always recovering from nearly falling off his board. Slater had grown up riding Florida’s small, scarce waves, and emerged with a style built to stuff the maximum number of hyper-athletic maneuvers into the least possible space. As he surfed better waves, the power and the creativity of his surfing deepened, until he dominated the pro circuit so completely that he grew bored and retired. A few years later, he returned to full-time competition and won five more world titles.

Inseparable from his surfing was his thinking—about what could be done on a wave, about board design, fin design, competition. Slater might turn up at the Pipe Masters, one of the most watched events on the pro tour, riding a bizarrely small and odd-shaped board, and brusquely shove back the frontiers of performance. He’s still doing it. Early this year, a video was released showing Slater slashing through powerful Hawaiian waves on a tiny double-bat-winged board. It was futuristic surfing, and the board he rode, called the Cymatic, is now one of the world’s most sought-after models. Never mind that very few people have the chops to ride it.

Slater has been thinking for decades about building an artificial wave. In an as-told-to memoir, from 2003, he noted, “Surfers have dreamed of creating the ultimate wave machine. The perfect setup would take surfing to every town in America and make the sport as mainstream as soccer.” Wave pools have been around since the nineteenth century, when Ludwig II, the Mad King of Bavaria, had a wave machine built on a lake at one of his palaces. Pools built specifically for surfing began to appear in the late nineteen-sixties, but even the best of them produced only weak, short, messy waves. Slater got serious about developing his ideas in 2006, and began working with scientists at the University of Southern California’s Viterbi School of Engineering.

Finally, in December, 2015, an astonishing video was released. Called “Kelly’s Wave,” it showed Slater, warmly dressed in a quilted jacket and a gray wool beanie, arriving at a misty pond at daybreak. In a voice-over, he calls it “our little secret spot” and admits to nervousness after “working on something for ten years.” As the first wave rolls, the camera stays on Slater’s face. His reaction to what he sees goes from anxious wonder to wide-eyed joy. “Oh, my God!” He throws out his arms, bounding in place. The next wave, when it comes peeling toward us, is coffee-colored, thin-lipped, impossibly clean. It’s breaking so precisely that it’s hard to tell if the film is running in slow motion. Slater puts on a wetsuit, paddles out, and catches one. Now there’s a little wind on it, ruffling the surface, and it looks more like a great ocean wave that happens to be the color of French roast—perhaps the best California point break on the best day in history. Your eye bounces around the frame, trying to place this spot—shaggy pine trees, fences, what look like farm outbuildings. It could be anywhere. Slater appears in a closeup, crouched inside a shining tube, looking thoughtfully up at the pitching lip, now semitransparent. An unobtrusive caption comes onscreen: “Waves roll all day.” Slater’s business partners say that there were more than a million views on YouTube in two days. I say that there were at least that number of texts flying around among surfers, expressing some version of “WTF?!?”

Matt Warshaw, surfing’s unofficial historian, says that the sport now has only two eras, Before Kelly’s Wave and After. It did feel as if something basic had changed—as if technology had, improbably, outdone nature. Still, the artificial wave was not met with universal acclaim. Many surfers felt that the future suddenly had a dystopian cast—mechanized, privatized, soulless. Yes, surfing might now become “mainstream,” with Slater’s magic wave reproduced in pools across the planet, but that is the last thing that most actual surfers want. The critics saw our pointless, difficult, obsessive pastime becoming exponentially more popular, and beloved home breaks ruined by terminal overcrowding. At the same time, there was virtually no one who surfs who didn’t ache to ride it. (...)

I arrived on the first day of the maiden Surf Ranch Pro. The early rounds of the contest were in progress, but there was no really good place from which to watch the surfing. The pool is seven hundred yards long, perhaps a hundred across, and the wave runs both north and south, so at least half the time you’re looking at the back of a wave. Often, live viewers were reduced to watching one of several jumbo screens erected above the eastern wall of the pool. We could hear bits of the Webcast commentary: “Carissa . . . power gouge to set up the pit.” Slater was already leading the men. The big screens filled the long minutes between waves with highlight replays and commercials for Jeep and Michelob and Hurley.

I found the replays deeply confusing. A slow-motion closeup of a great surfer like Carissa Moore tucking into a spiralling barrel was mesmerizing, but not because of what Moore was doing—she was, after all, invisibly deep for most of the clip. Instead, I found myself bug-eyed, forgetting to breathe, silently shouting, “Look at that wave!” The relentless precision of the spilling lip was the news. It was a once-in-a-lifetime wave. Of course, I was being absurd. Every wave here did that.

by William Finnegan, New Yorker |  Read more:

Image: Ben Lowy

[ed. See also: Finnegan's Pulitzer prize-winning book Barbarian Days: A Surfing Life (excellent review here). Probably the best book on surfing ever written.]

How Two Times Reporters Covered the Hunt for Oil in Alaska

Times Insider delivers behind-the-scenes insights into how news, features and opinion come together at The New York Times.

The Arctic National Wildlife Refuge, 19 million acres of pristine land in northeast Alaska, may soon be open to oil drilling. Last December, Congress approved a measure to open the refuge’s coastal plain, known as the 1002 Area, to oil exploration. As early as next year, the Interior Department could be selling drilling leases.

In a recent front-page story, Steve Eder, an investigative reporter for The Times, and Henry Fountain, a Times climate reporter, examined how the region went from off-limits to open for business. Among their findings: The 2017 tax overhaul bill provided a rare opportunity to open the refuge for drilling; plans at the Interior Department are being overseen by appointees with deep ties to Alaska; and environmental evaluations have been fast-tracked by the Trump administration.

Mr. Eder and Mr. Fountain recently discussed their reporting. Their answers have been lightly edited and condensed for clarity.

How did this story originate?

HENRY FOUNTAIN This whole issue of drilling in the refuge has been around for 40 years, but it’s come to a head in the last year or so with the Trump administration.

There’s been this whole train of reporting this year about the Trump administration moving to undo Obama-era policies. So this was another example of it, and a really interesting one, because it’s happening so fast. This is also a very specific example of something that has been outlawed, and all of a sudden it’s being undone.

STEVE EDER I think there was recognition that this was an important topic and something that we ought to delve into and try to help explain to readers what’s happening and why it’s happening.

The idea was to pair up Henry’s scientific understanding and Alaska knowledge — he’s written a book about the 1964 Alaska earthquake and has spent a considerable amount of time there — with my background in delving deeply into this kind of topic. We both went to Alaska. We were on the ground together.

What was your trip to Alaska like?

FOUNTAIN We stayed in Anchorage; had a lot of breakfasts at this one great breakfast place, Snow City Cafe. And we made a quick trip to Fairbanks for more reporting.

EDER We ate a lot of salmon. We were so busy and focused on reporting, and when we weren’t reporting, we tended to be talking about what we were finding and trying to digest things as we went. It was my first time in Alaska, and Henry’s obviously been many times. So at the end of the week, we took an afternoon to explore a little bit, drive around. We went for a mini-hike in the Chugach Mountains just outside the city.

FOUNTAIN When we got back to New York, we and our editors realized that it would be important for the story to get a sense of what the refuge looks like now. The place isn’t easy to get to; there are no roads into or within it. It’s only reachable by plane, and winter weather can disrupt flights. But we got a freelance photographer, Katie Orlinsky, to take a bush flight up there from Fairbanks. She came back with beautiful photos and helped us describe the place.

What did being in Alaska allow you to bring to the article?

FOUNTAIN You get a sense that Alaskans don’t want people outside of the state telling them what to do. They’re very proud of their state and all the incredible places they have. It’s huge, and most of it’s wild and great and beautiful. So there’s a real sense of, “We’re in Alaska; we want to do what we want to do.” I got a sense of that talking to people directly. You wouldn’t get it so much on the phone. So I think going there was well worth it.

by Katie Van Syckle, NY Times | Read more:

Image: Katie Orlinsky

[ed. OMG. Reporters interviewing reporters about their intrepid trip to the Wilds (which, it sounds like, mainly consisted of a short visit to Anchorage, eating at a yuppie breakfast joint, hiking near the city and a brief flight to Fairbanks.... oh, and eating lots of salmon). I don't know how many times I've heard journalists, bureaucrats, politicians, even scientists talk about being "out in the field" whenever they came to Anchorage (pop. 300,000), even while staying downtown at the Hotel Captain Cook. Here's the story: In the Blink of an Eye, a Hunt for Oil Threatens Pristine Alaska.]

Flight of the Conchords

[ed. Lyrics]

René Magritte, Les Moyens d’Existence, 1969
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When Did Parties Become So Boring?

Adults are not always so fun. Sometimes I go to parties filled with mature people who know things and act their age and I’m quickly filled with despair. I walk in the door and greet the host and mill about, but in the pit of my stomach I know that leaving home was a huge mistake. I will not be surprised and delighted. I will not learn something new. I will not even enjoy the sound of my own voice. I will be lulled into a state of excruciating paralysis and self-hatred and other-people hatred.

Let’s be honest, some days, sensible middle-aged urban liberal adult professionals are the most tedious people in the world. I know that I should feel grateful that these people, my peers, are enlightened, that they listen to NPR and read The Atlantic, that they join book clubs and send their kids to the progressive preschool and the Italian-immersion magnet. I should feel cheered by the fact that I know human beings who hold national grants to improve government policy on something or other, or who work with troubled teenagers. These people are informed and intelligent. These are the people I should want to know. But I am an ingrate.

My lack of gratitude might be a product of despair, which pairs badly with my lukewarm Hawaiian-surfer-themed microbrew. I should be thankful that almost everyone at this party skimmed The New York Times this morning. I should feel glad that they read the latest book by Donna Tartt so they can tell me that they didn’t think it was all that good, in the vaguest terms possible. I should see this as an opportunity to hear myself say words out loud about the latest book by Donna Tartt, throwing in specific arguments about what qualifies as good writing and what makes a book worthwhile—but without insulting anyone or swearing for no reason or making spit fly out of my mouth in the process. But I might get long-winded and say too much. There is a palpable pressure to never say too much here. There is an imaginary egg timer for every comment. The sand runs out, the eyes go dead.

I should be glad just to be here, to be invited out of the house so I can stand beside a table of food I didn’t personally prepare, all of those bad salads with the quinoa and the mushy bits of avocado and the overcooked pasta and the giant lumps of bland feta and the little bits of green stuff that have no discernible flavor. I should feel thankful to be slowing down in sync with this diverse and informed tribe, to be aging gracefully among these mild-mannered international humans in their denim shirts, in their linens, in their comfortable shoes, in their terrible newsboy caps, holding their beers until they sweat and grow warm, sipping their glasses of pinot grigio but never having a second glass, helping themselves to an intolerably weak margarita that needs a sign that says Adults Only on the side because it is served in small blue Dixie cups and it looks and tastes exactly like lemonade. After one cup I quickly calculate that I will need to drink the whole pitcher of Adults Only Lemonade to catch a buzz. For a while I try to do this.

But catching a buzz is not the point at a gathering like this one. In fact, the point is to avoid catching a buzz. Sure, these professional adults once used to drink too much and say the wrong things when they were much younger. But they’ve accumulated enough experience over the years to realize that the more appropriate thing is to resist such an impulse, to file down their more unsightly edges, to blend in. It’s not that they don’t still have unpopular opinions and bad urges. They’re just mature enough to know these things make people uncomfortable, end friendships, hijack careers. You can’t go to a party and act like you’re at a party. You’re too old for that. You might speak out of turn or contradict yourself or offend someone. That’s not how adults do it.

Among adults, everything must exist within clearly defined boundaries and limits: No heels are uncomfortably high (and everyone leaves their shoes at the front door anyway), no music is too loud, no lipstick is too dark, no food is too spicy, no drink is too strong, no conversation lasts too long. No one yells or points or mocks, even just for fun. No one has any obvious personality disorders. No one is quiet or seems lonely. No one looks desperate or sweaty. No one is inappropriate or has lipstick on her teeth or is wearing overly large statement jewelry. No one is calling attention to himself for no reason. No one is anxious to cause a stir. No one feels trapped, not outwardly. Such feelings—the longing, the anger, the envy—all of that should have been lifted away decades ago, evaporated, whisked away by linen blends and decaf coffee drinks and probiotics.

Everyone should appear calm and properly hydrated now. Everyone should claim to feel just right in their terrible shorts, their legs crossed like Europeans, their temples graying by the minute, their pleasant expressions saying, “I see your point, I understand, that is also true.” Everyone should be smiling with their eyes and talking with their hands.

They’d like more pasta, but they could also live without it.

I can’t do it. The quiet restraint, the lack of discernible needs or desires, the undifferentiated sea of dry-cleaned nothingness, the small sips, the half smiles, the polite pauses, the autopilot nodding. It feels like we’re all voluntarily erasing ourselves, as if that’s the only appropriate thing to do.

by Heather Havrilesky, Esquire |  Read more:

Image: Penguin Random House LLC
[ed. See also: The Best Advice Columnist of Her Generation Gives Zero F*cks About Your Judgment.]

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If People Talked to Other Professionals the Way They Talk to Teachers

“Ah, a zookeeper. So, you just babysit the animals all day?”

- - -

“My colon never acts this way at home. Are you sure you’re reading the colonoscopy results correctly? Did you ever think that maybe you just don’t like my colon?”

- - -

“I’d love to just play with actuary statistics all day. That would be so fun! I bet you don’t even feel like you’re at work!”

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“You’re a sanitation worker, huh? I hated my garbage collectors when I was growing up. One of them once yelled at me when I stood directly in front of their truck and kept it from completing its appointed rounds, and ever since then I’ve just loathed all of them, everywhere.”

- - -

“So you run a ski lodge? Do you just, like, chill during the summer? Must be nice.”

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“Since my singer-songwriter thing isn’t taking off yet, I’ve been thinking about going into lawyer-ing. I mean, how hard can it be? I know criminals like me, or at least the two that I see once a year at Thanksgiving do.”

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“I bet that’s the best part of being a banker — all the free money!”

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“Do you even read your patients’ charts, or do you just assign them a random dosage based on how nice they’ve been to you?”

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“Before you give me a ticket, Officer, I just wanted to mention: My taxes pay your salary.”

by Shannon Reed, McSweeny's |  Read more:

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US Regulators Have Essentially Become Do-Nothing Institutions

Something has gone terribly, terribly wrong with American capitalism. This argument, put forth by Jonathan Tepper and Denise Hearn, lies at the heart of their explosive new book The Myth of Capitalism: Monopolies and the Death of Competition. Instead of delivering on its stated promise to provide more opportunity, prosperity and choice, they argue, Americans today are subjected to a system that encourages and rewards predatory behavior, in which corporate monopolists and oligopolists are allowed to bleed consumers dry (and sometimes literally make them bleed) with impunity because the government has been “captured to rig the rules of the game for the strong at the expense of the weak.”

The two, it should be noted, are no Marxists—quite the opposite. A staunch and passionate advocate for free markets, Tepper is the founder of Variant Perception, an investment research firm that caters to hedge funds, banks, asset mangers and family offices. A senior fellow at The American Conservative, he has previously worked at SAC Capital and Bank of America (where was he was Vice President in proprietary trading).

How does a self-professed fan of markets end up writing a book titled “The Myth of Capitalism”? For one, argues Tepper, what is often called capitalism today is not, in fact, capitalism: competition is the essence of capitalism, and there is almost no competition in the American economy today. “Capitalism,” write Tepper and Hearn, “has been the greatest system in history to lift people out of poverty and create wealth, but the ‘capitalism’ we see today in the United States is a far cry from competitive markets.” Instead, the US economy has been overtaken by a “fake version of capitalism,” with government officials allowing (even cultivating) the concentration of economic and political power in the hands of few powerful monopolists who “cozy up to regulators to get the kind of rules they want and donate to get the laws they desire.”

A clear and incisive indictment of the United States’ increasingly monopolized economy, where rising market power has led to less competition, lower productivity, lower wages and staggering inequality, The Myth of Capitalism is also an urgent call to action for both the left and the right to support the restoration of America’s antimonopoly ideals. [We published an excerpt from the book last week. Read it here.]

In a recent interview with ProMarket, Tepper talked about the rise of America’s oligopoly problem, explained why he believes antimonopoly is not a left-right issue, and called on those who believe in free markets to support meaningful reforms. “If the people who love capitalism and competition don’t reform markets,” he warns, “people who don’t like capitalism are going to do it, and I think that we’ll all be worse off.”

Q: You start the book with David Dao, the passenger that was a beaten and forcibly removed from a United flight last year for refusing to give up his seat. What is it that makes what happened to Dao “a metaphor for American capitalism in the twenty-first century,” as you call it?

First, I think the episode clearly resonated with the public because people feel that something’s changed in the airline industry, that airlines are nickel and diming them, and that part of it is also tied to increasing concentration and market power.

But the main reason [David Dao] came to my mind is that in the days after, I was reading the news and there were quite a few articles pointing out how airlines are now an oligopoly and that you have no choice, and most of the Wall Street research houses were putting out similar notes, so the stock went up. The idea was that it just doesn’t matter what you do in terms of public relations or how you treat customers—if you have a lock on the customers, they have no choice.

So you have the passenger who was bloodied, and that’s horrific. But what was almost more horrific was that once everyone started focusing on the fact that it was an oligopoly, the stock went up. (...)

Q: And yet you argue that what we have in the United States today is a “grotesque, deformed version of capitalism.” What is the difference between capitalism, as you see it, and today’s US economy?

Jeremy Grantham once said that “profit margins are the most mean-reverting series in finance. If margins don’t revert, something has gone wrong with capitalism.” Given that we have record-high corporate profit margins and very little mean reversion, it is a sign that we aren’t seeing a lot of competition. It’s not just obvious that we don’t have a lot of competition from new entrants, but there’s relatively little competition in many industries—a lot of markets are divided up geographically, or there’s collusion.

Capitalism is not just having private property and not being communists, but rather it’s actually having competition. Competition is what creates clear price signals that help drive supply and demand. So the absence of competition, the absence of contestability, is troubling. (...)

Q: There has been a lot of talk in the media about America’s monopoly problem in recent years, but you argue that the US doesn’t have a monopoly problem so much as an oligopoly problem. Why is oligopoly the more pressing problem?

Having four players is not vastly better than having one. Some people say that only monopolies are bad and therefore if you don’t have a monopoly, things are totally fine. The truth is there are sectors in the economy where you have duopolies or an oligopoly with three, four, even five players. What ends up happening is that you end up with tacit collusion, where companies play repeated games with each other and have no incentive to compete on price.

You’d think that if one of them hikes prices, the others might then want to capture some market share, but basically competitors tend to move in lockstep. You don’t even have to do that by speaking to each other—it’s pretty well understood that you can use company conference calls and establish essentially what you’re going to do in terms of trying to chase market share or not, or your levels of pricing and all that.

In the book, I quote one of the world’s top pricing experts who wrote a book where he pretty much advises companies to send signals to the market, whether it’s via press releases or quarterly conference calls, but recommends that the readers consult with their lawyers and attorneys first, clearly understanding that speaking directly is illegal but speaking indirectly is not. There’s been research done on airline conference calls and how airlines have used conference calls to indicate whether they’ll expand or not. The FTC was in fact looking into that—but the FTC is a do-nothing institution and I doubt anything will come of it.

But you find this in many other areas. In the book, I compare this to how the mob commission used to divide up the US: One family might have one part of the city and another family might have the other part of the city, and people would stay off each other’s turf. If you look at the way that the insurance markets carved up the United States, where you’ll have one or two dominant insurers per state, or how retail stores divided up the US geographically and tend not to compete head on, it’s very similar. (...)

Q: The US economy you describe in the book is markedly different than what American capitalism looked like 40-50 years ago. How did we end up here?

The counterrevolution which led us to where we are today really started essentially in the 1960s and 1970s, when Robert Bork and others did not like the fact that the antitrust was being vigorously enforced. They thought it was preventing efficiency and some economies of scale, and they did have a point—antitrust was very restrictive, and some minor deals that wouldn’t have caused any competitive issues were blocked.

But the problem is that when you fast forward 40 years later, what started out as possibly a worthwhile effort to allow slightly more mergers has ended up becoming basically a policy that’s become a do-nothing policy, in which K Street law firms, economists-for-hire that go in and out of government at the DOJ and the FTC, and Wall Street firms are all spectacularly well paid to push mergers through.

It’s very much like the NCAA’s Sweet 16, where you start out with 16 teams and then get down to eight, and then four and then two. We’ve had a merger wave in the 1980s that graduated in the 1990s, a merger wave leading up to the 2007 crisis and then a merger wave that peaked around 2015, and in many industries we’ve just basically been eliminating player after player.

That’s really sort of how we got here: a ratchet effect where each merger wave takes out more and more players. The process of getting mergers through is deeply corrupted, with economists-for-hire presenting models showing that prices will go down and studies showing that these models are almost always wrong and that you generally get higher prices. The whole system is essentially a charade.

Q: But also, the government was not a silent player in all this. Many political choices were made along the way.

I completely agree. I think that one of the key issues is that the government completely and radically changed antitrust through the bureaucracy, through the merger guidelines, and then basically by doing nothing and allowing mergers to proceed. Whereas the Sherman Act and Clayton Act were political acts passed by Congress, this is not something that we’ve collectively agreed is what we want. I think that most people are appalled at how things have changed.

In many cases, the people who are pro-merger have also taken over the courts and basically made the burden of proof so high that it’s very difficult to stop mergers. A lot of this is highly, highly ideological, in the sense that most of the pro-merger studies or models that are done before mergers turn out to be wrong, retrospectively. I have loads of footnotes in the book, and I hope people do go and read further studies.

What really happened is basically what I call an orgy of influence-peddling, with people moving in and out of the top of the FTC and the DOJ essentially green-lighting mergers and helping make them happen once they’re out of government. (...)

Q: What is your proposed solution for reforming markets and restoring an open, competitive economy?

In the book, I have a series of principles and specific reforms based on those principles. They’re fairly broad and I don’t pretend to have all the answers. There are many other people that put forward good ideas. Some of the key principles I mention are trying to reduce barriers to entry, to enhance competition, enforcement of antitrust, which means preventing mergers that reduced competition as well as undoing previous mergers that have created less competitive markets. Another key principle is to limit the revolving door. In the case of the US, you want to make sure that companies are limited in terms of how they can influence elections.

Those are just very basic reforms, but they could go a long way if implemented. Markets will not reform themselves. Monopolists are not going to want to give up their power and the current status quo in antitrust, because it pays them very, very well.

I would add that I’m not in favor of more regulation on its own. High levels of regulation create higher barriers to entry, and the most regulated sectors tend to be the ones with the highest concentration. What I’m in favor of is principles-based regulation rather than rules-based regulation. Glass Steagall was 35 pages long and worked for about 70 years, while Dodd-Frank is 2,200 pages and we’ve basically seen almost no new banks. I am also wary of creating new regulators or making regulators more powerful without making them accountable, because then you get regulatory capture. But I do believe we need more vigorous antitrust and a sensible reform of regulations.

by Asher Schechter, ProMarket | Read more:
Image: via

Is It Ethical to Use Amazon?

Just about every week, I order a thing from Amazon. Sometimes it is a connector cable or some teabags. Occasionally it is a bag of gummy volcanoes. Checking my order history, I find that most recently it was a pair of lamp harps and a copy of John Cassidy’s How Markets Fail. I have an Amazon Prime account, which not only gets me free two-day shipping but grants me unlimited access to such cinema classics as Atlas Shrugged: Part II. I do not have an Alexa, because they are creepy. But I’ve bought everything from fountain pens to ladybugs and given Jeff Bezos God-knows-how-many of my hard-earned dollars.

All of which raises the question of whether I am a hypocrite who daily violates the principles he most holds dear. Actually, I know I am a hypocrite who violates my dearest principles—I suppose the question is rather: Just how bad of a hypocrite am I? Can one denounce Amazon’s business practices while using its services? Should people feel bad about using Amazon? Should they actively try to avoid it?

Let’s be clear: Amazon is terrible. Just a truly awful company in so many ways. Most recently, of course, they pitted struggling cities around the country against each other in a brutal “race to the bottom” to see how many taxpayer handouts they could get. New York City’s bribes succeeded and now Amazon has granted New York the privilege of having one of its working-class neighborhoods rapidly gentrified, and becoming even more unequal. But Amazon also overworks both its white-collar and blue-collar employees, and threatens to use its economic power to hurt local economies if the people so much as think of trying to make the company pay its fair share in taxes. An Amazon-dominated future is a bleak one: total unaccountable control of the economy in the hands of one fabulously wealthy individual, millions upon millions of people toiling away in his factories and warehouses.

Given all of that, the only ethical path would seem to be to have nothing to do with Amazon. Don’t go near it! Nobody’s making you. Why give money to Jeff Bezos? Amazon is like Walmart, and as with Walmart you should give your money to small businesses instead. Help your local shops, the places that treat their employees well and actually pay their taxes. If you succumb to Amazon’s temptations, you’re complicit in their evil.

And yet: As much as this makes sense to me intuitively, it also seems troublingly close to the conservative line that I reject: If you hate capitalism so much, why do you use an iPhone? (For the record, personally I don’t have an iPhone. I have one of these.) Versions of that kind of thinking strike me as silly: “You critique feudalism yet you live under feudalism,” “You say your boss exploits you, but you’re the one who chooses to work there,” “You criticize the actions of the American government yet you continue to live here.” In each case, the person making the critique seems to be focusing on the wrong thing. Why should we leave the country instead of making the government’s policies better? Why should we give up our paycheck instead of demanding an end to exploitation? Because it’s perfectly possible to “have your cake and eat it too,” why should we be asking people to choose between either bad cake or no cake?

That’s kind of how I think about Amazon and the iPhone. The problem isn’t that people use iPhones, it’s that iPhones are produced under intolerable conditions. If people should be ashamed, it’s not for the act of purchasing the product, but for failing to join a political movement aimed at ending exploitation. There’s nothing inherently wrong with having something like Amazon, a central system for choosing and delivering goods. (Apart from the climate consequences of mass consumption which is an entirely separate debate that will be had on a day that is not today.) The problem is that this system is operating as an extreme hierarchy, in which one man reaps nearly all the benefits and workers have very little control over their conditions. The solution, then, should not be to get people to stop using Amazon, any more than the solution to bad government policy is to leave the country. Instead, the goal should be to democratize Amazon and redistribute its earnings more equitably. In a way, Amazon is like the government: It’s been called monopolistic, and is steadily becoming more so. Plus, as with the working class families who shop at Walmart, why would we put the onus of ethical action on the consumer trying to save money? And besides, is Amazon that much worse than other giant corporations? On the left, there’s a slogan: “There is no ethical consumption under capitalism,” meaning that if the economic system is based on exploitation, it’s fruitless to try not to participate in an exploitative system. You’re going to be, no matter what, unless you go off and live in the forest and eat berries. So you might as well keep your Prime account, keep getting Always Lower prices at Walmart, and join the international proletarian movement!

I tell myself all of these things, and I believe them, but then I quickly swing back in the other direction: Okay, fine, there may not be any PERFECTLY ethical form of consumption, but surely there is more and less ethical consumption. If you have a choice between non-union sweatshop-made goods and goods made with well-paid unionized laborers, shouldn’t you choose the latter? Do consumers really bear no responsibility for the consequences of their choices? If consumers stopped using Amazon, Amazon wouldn’t be able to keep exploiting people. Boycotts can work, consumers have power. This seems persuasive to me, too. If I wear coats made by slaves, and I could choose to wear coats that are not made by slaves, surely that’s bad. And if that’s bad, then aren’t other choices just less extreme versions of a quite real ethical dilemma?

All of this gets complicated by another ethical problem: that of needless consumption itself. Is the problem that I am buying gummies and lamp harps from Amazon in particular, or is it that I am buying gummies and lamp harps when there are poor children whose families can’t afford to keep them alive? Perhaps the thing that makes me a hypocrite is not that I am going to the wrong retailer, but that I’m buying retail goods that I don’t absolutely need. I’ve wrestled with this before in the context of Mardi Gras: I love Mardi Gras, but it’s wasteful, extravagant, and in some sense pointless, and I have difficulty trying to justify it. And yet I feel strongly that a world without Mardi Gras would be a much worse world and that there’s no need to choose between Mardi Gras and healthy children. The kind of life I live, with its occasional carnivals and candies, seems like one everyone could have if we distributed the earth’s resources well.

I have no good answers to the Amazon problem, because I hold two beliefs that contradict each other and I haven’t found a way to reconcile them: (1) what’s wrong is not the act of purchasing from Amazon, but what Amazon does to its employees, and since there would be nothing wrong with purchasing from Amazon if it was, say, a worker cooperative, the demand should be “democratize it” rather than “stop using it.” (2) You shouldn’t buy from companies with highly unethical business practices, such as staying in a hotel that fired striking workers, or buying slave-made goods. I wrestle with this constantly, because Amazon is very difficult to avoid: We sell Current Affairs books and magazine subscriptions using Amazon and we use certain Amazon “web services” (Amazon absolutely dominates cloud computing and is bigger than its four next biggest competitors—Google, Microsoft, IBM, and Alibaba—combined, so lots of entities that you might not think are supporting Amazon are supporting Amazon). The company is going to continue to grow and grow, and we will all be touched by it in one way or another. Is it right or even helpful to boycott it? Should we decline to watch Amazon TV shows, on principle, and if so what is the principle?
by Nathan J. Robinson, Current Affairs |  Read more:

Image: uncredited

Lessons From Chomsky

It has been 50 years since Noam Chomsky first became a major public figure in the United States, after publishing his essay “The Responsibility of Intellectuals,” which argued that American academics had failed in their core duty to responsibly inquire into truth. Over the past five decades, he has paradoxically been both one of the most well-known and influential thinkers in the world and almost completely absent from mainstream U.S. media.

Nobody has been more influential on my own intellectual development than Chomsky. But I recently realized that what I’ve learned from Chomsky’s work has had almost nothing to do with the subjects he is most known for writing about: linguistics, U.S. foreign policy, and Israel. Instead, where I feel Chomsky’s influence most strongly is in a particular kind of approach to thinking and writing about political, social, and moral questions. In other words, it’s not so much his conclusions as his method (though I also share most of his conclusions). From Chomsky’s writing and talks, I have drawn an underlying set of values and principles that I have found very useful. And I think it’s easy to miss those underlying values, because his books often either consist of technical discussions of the human language faculty or long and fact-heavy indictments of United States government policy. So I’d like to go through and explain what I’ve learned and why I think it’s important. The lessons I’ve learned from Chomsky have encouraged me to be more rational, compassionate, consistent, skeptical, and curious. Nearly everything I write is at least in part a restatement or application of something I picked up from Noam Chomsky, and it feels only fair to acknowledge the source.

Libertarian Socialism

In the United States, “libertarianism” is associated with the right and “socialism” with the left. The libertarians value “freedom” (or what they call freedom) while the socialists value “equality.” And many people accept this distinction as fair: After all, the right wants smaller government while the left wants a big redistributionist government. Even many leftists implicitly accept this “freedom versus equality” distinction as fair, suggesting that while freedom may be nice, fairness is more important.

Libertarian socialism, the political tradition in which Noam Chomsky operates, which is closely tied to anarchism, rejects this distinction as illusory. If the word “libertarianism” is taken to mean “a belief in freedom” and the word “socialism” is taken to mean “a belief in fairness,” then the two are not just “not opposites,” but they are necessary complements. That’s because if you have “freedom” from government intervention, but you don’t have a fair economy, your freedom becomes meaningless, because you will still be faced with a choice between working and starving. Freedom is only meaningful to the extent that it actually creates a capacity for you to act. If you’re poor, you don’t have much of an actual capacity to do much, so you’re not terribly free. Likewise, “socialism” without a conception of freedom is not actually fair and equal. Libertarian socialists have always been critical of Marxist states, because the libertarian socialist recognizes that “equality” enforced by a brutal and repressive state is not just “un-free,” but is also unequal, because there is a huge imbalance of power between the people and the state. The Soviet Union was obviously not free, but it was also not socialist, because “the people” didn’t actually control anything; the state did.

The libertarian socialist perspective is well-captured by a quote from the pioneering anarchist Mikhail Bakunin: “Liberty without socialism is privilege and injustice; socialism without liberty is slavery and brutality.” During the 1860s and ’70s, 50 years before the Soviet Union, Bakunin warned that Marxist socialism’s authoritarian currents would lead to hideous repression. In a Marxist regime, he said:

There will be a new class, a new hierarchy of real and pretended scientists and scholars, and the world will be divided into a minority ruling in the name of knowledge and an immense ignorant majority. And then, woe betide the mass of ignorant ones!… You can see quite well that behind all the democratic and socialistic phrases and promises of Marx’s program, there is to be found in his State all that constitutes the true despotic and brutal nature of all States.

This, as we know, is precisely what happened. Unfortunately, however, the bloody history of 20th century Marxism-Leninism has convinced many people that socialism itself is discredited. They miss the voices of people in the libertarian socialist tradition, like Bakunin, Peter Kropotkin, and Noam Chomsky, who have always stood for a kind of socialism that places a core value on freedom and deplores authoritarianism. It emphasizes true democracy; that is, people should get to participate in the decisions that affect their lives, whether those decisions are labeled “political” or “economic.” It detests capitalism because capitalist institutions are totalitarian (you don’t get to vote for who your boss is, and you get very little say in what your company does), but it also believes strongly in freedom of expression and civil liberties.

Libertarian socialism seems to me a beautiful philosophy. It rejects both “misery through economic exploitation” and “misery through Stalinist totalitarianism,” arguing that the problem is misery itself, whatever the source. It’s a very simple concept, but it’s easy to miss because of the binary that pits “communism” against “capitalism.” Thus, if you’re a critic of capitalism, you must be an apologist for the most brutal socialist governments. But every time there has been such government, libertarian socialist critics have been the first to call it out for its hypocrisy. (Usually, such people are the first ones liquidated.) But the libertarian tradition in socialism is precious. And Chomsky, skeptical of corporate and governmental power alike, is our foremost public exponent of it. See: Chomsky on Libertarian Socialism.

Pragmatic Utopianism

The problem with utopians is that they’re not practical, and the problem with pragmatists is that they often lack vision. If you dream of elaborate perfect societies, but you don’t remain anchored in real-world realities and have a sense of how to get things done, all of your dreams are useless and you may even end up destroying the progress you have already made for the sake of an ideal you’ll never reach. But if you don’t have a strong sense of what the ultimate long-term goal is, you’re not going to know whether you’re moving closer to it or not.

Chomsky’s approach to “political reality” seems to me a good balance of both radicalism and pragmatism. He is an anarchist in his strong skepticism of authority, and a utopian in his belief that the ideal world is a world without social class or unjust hierachies of any kind, a world without war or economic deprivation. But he is also deeply conscious of the realities of the world we live in and the need for those who care about moving towards this utopia to be willing to take small steps rather than just wait for a “revolution.”

Consider Chomsky’s approach to voting. Chomsky believes simultaneously that (1) voting is not a very important part of politics, because it doesn’t change much thanks to the combination of the typically awful candidates and the low impact of a single vote and (2) you should still vote, and if you live in swing state, you should vote for the Democratic candidate for president. He is radical in that he believes we need far broader political action than simply voting once every few years for the least-worst of two major party candidates, but practical in that he also believes that it’s better if Democrats get into office than Republicans. Chomsky understands that you can simultaneously work to save ObamaCare and believe that it’s a pitiful substitute for a genuine health-care guarantee, and we need much more radical change. See: Chomsky on Voting and Democrats. (...)

The Consistent Application of Moral Standards

One of Chomsky’s simplest principles is among the most difficult to apply in practice: You should judge yourself by the same moral standards that you judge others by. This has formed the core of his critique of U.S. foreign policy, and yet it is often insufficiently appreciated even by those that embrace his conclusions. Many people think that Chomsky is uniquely “anti-American.” In fact, his criticisms of the United States are so strong largely because when this elementary moral principle is applied to the facts, the conclusion is inevitably deeply damning. It simply turns out that if you judge the United States by the standard that it uses to judge other people, the United States does not look very good. If you take the facts of, say, the U.S. bombing of Laos(where the United States secretly dropped 2.5 million tons of bombs in the ’60s and ’70s, massacring and maiming thousands of peaceable villagers, 20,000 of whom were killed or injured in the decades after the bombing when unexploded bombs went off), and you imagine how it would appear to us if the roles had been reversed and Laos had been bombing the United States, you begin to see just how inconsistent we are in our evaluations of our own actions versus the actions of others. 500,000 people died in the Iraq War. If Iraq had invaded the United States and 500,000 people died (actually, the proportional population equivalent would be closer to 5,000,000), would there be any way that anybody in the country could conceive of Iraq as a “force for good” in the world in the way that the U.S. believes people should think we are? It’s laughable. If Vietnam had invaded the United States the way the United States had invaded Vietnam, could such an act ever be considered justified?

This idea of moral consistency, of trying to treat like behaviors alike, is the simplest possible notion in the world. It’s so elementary that it sounds childish to even pose the questions. And yet the power of latent patriotic sentiment is so great that it makes a clear-eyed and fair assessment incredibly difficult. It’s hard to see the world through other people’s eyes, to see what our self-justifications look like to those who are on the receiving end of our actions. And when we do it, it’s deeply discomforting. But this is the foundation of Chomsky’s critique: It’s not enough to have “values” (e.g., “terrorism is bad”), you must apply those values consistently (i.e., if something would constitute terrorism if done against us, it must constitute terrorism if it is done by us). Chomsky is seen as being “anti-American” for pointing out that if the Nuremberg principles were applied consistently, essentially every postwar U.S. president would have to be hanged. But this is just a result of the application of consistency: The crime of “aggressive war” that was so forcefully condemned at Nuremberg has been committed repeatedly by the U.S.

In both linguistics and politics, Chomsky often uses his famous “Martian coming to Earth” example: Try to imagine what our planetary affairs would look like to someone who was not part of one of the particular human societies, but was separate from them and able to see their commonalities. They would perceive the similarities between human languages, rather than the differences, and they would see the bizarre ways in which each country perceives its own acts as right and everybody else’s as wrong, even when the same acts are being committed.

The principle of treating all human beings consistently has an incredible power to illuminate, because it helps us clarify what our values actually are and make sure we are following them. But it also helps us become true “universalists,” in the sense that we can begin to view things from a human perspective rather than a nationalistic perspective.

by Nathan J. Robinson, Current Affairs |  Read more:

Image: uncredited

[ed. See also: Noam Chomsky at 90: On Orwell, Taxi Drivers, and Rejecting Indoctrination.]

Flickr’s Big Change Proves You Can’t Trust Online Services

I need a digital moving van.

I have 60 days to relocate more than 2,100 images from their home on Flickr to another safe digital haven. The once popular photo-sharing destination announced this month that it’s limiting free membership accounts to just 1,000 images. If you want unlimited storage, you’ll have to pay $50 a year. Don’t pay up? The service will delete old photographs until you’re at the 1,000-image limit.

I already pay almost $40 a year for iCloud storage and another $99 a year for the 1 Terabyte (TB) of space that comes with my Office 365 account. I’ll skip the extra bill.

Some might call me cheap, but Flickr’s policy change highlights a larger concern for anyone storing their files on someone else’s servers, i.e. the cloud.What you understand and trust about their terms of service could change at any time. Free now — looking at you Google Photos — might not mean forever. The uncertainty around the future is reason to reevaluate the services you use in the present.

Two years ago, Flickr’s former parent Yahoo, the once powerful online giant, agreed to a $5 billion acquisition deal with Verizon. It now lives alongside another online cautionary tale, AOL, which was acquired by Verizon in 2015.

The telecom giant has spent months consolidating and cleaning house, which included quietly selling Flickr to the photo-sharing tchotchke company SmugMug. It’s a testament to how things have changed for Flickr, once the yardstick for all digital image activities. Flickr was how we first understood the meteoric rise of smartphone photography. It was the original Instagram, the place we shared and commented on photos.

Ironically, even as one of the most popular cameras used on Flickr became “iPhone,” Flickr, like much of Yahoo, failed to ride the mobile wave. Today, it’s a destination for those who care deeply about the craft of photography, excellent NASA images, and royalty-free images via Creative Commons. According to one report, the service still has 90 million monthly active users across 63 countries.

I joined Flickr 12 years ago and have driven almost a quarter of a million views to the service. Like everyone else, I stopped posting photos on Flickr and shifted my digital photography and art activities to the higher engagement of Instagram, Facebook, and Twitter, but that doesn’t mean I don’t care about my existing Flickr images.

Over the years, Flickr had slowly but consistently raised the price of my pro account to the point where it no longer made financial sense for me to continue. But to limit existing free accounts to 1,000 photos isn’t fair. Most of us have built our Photostreams up over the course of years. We’ve invested time and emotion into each image and helped build the still vibrant Flickr community. Our thanks is, “Get your stuff off our digital lawn!” A community-driven service like Flickr should, even as it changes, work to honor its existing community.

At the very least, Flickr should grandfather existing accounts and only apply this rule to new members. Let the non-pro members keep any number of existing photos on the service. If existing Flickr members want to add more images or access any other “Pro” features, then charge them. Asking people to remove thousands of images, especially when not everyone will have a secure place to store them, is wrong. I might even call it “smug.”

Perhaps you’re not on Flickr and figure this isn’t your problem. But viewed from the perspective of data storage on any platform, Flickr’s decision is deeply concerning.

by Lance Ulanoff, Medium |  Read more:

Image: bagotaj/Getty
[ed. Case in point: Tumblr's recent decision to commit hara-kiri. The only workaround seems to be maintaining multiple accounts as a backup.]

Super Cub
via:

Uber Is Headed for a Crash

By steamrolling local taxi operations in cities all over the world and cultivating cheerleaders in the business press and among Silicon Valley libertarians, Uber has managed to create an image of inevitability and invincibility. But the company just posted another quarter of jaw-dropping losses — this time over $1 billion, after $4.5 billion of losses in 2017. How much is hype and how much is real?

The notion that Uber, the most highly valued private company in the world, is a textbook “bezzle” — John Kenneth Galbraith’s coinage for an investment swindle where the losses have yet to be recognized — is likely to come as a surprise to its many satisfied customers. But as we’ll explain, relying on the extensive work of transportation expert Hubert Horan, Uber’s investors have been buying your satisfaction in the form of massive subsidies of services. What has made Uber a good deal for users makes it a lousy investment proposition. Uber has kept that recognition at bay via minimal and inconsistent financial disclosures combined with a relentless and so far effective public-relations campaign depicting Uber as following the pattern of digitally based start-ups whose large initial losses transformed into strong profits in a few years.

Comparisons of Uber to other storied tech wunderkinder show Uber is not on the same trajectory. No ultimately successful major technology company has been as deeply unprofitable for anywhere remotely as long as Uber has been. After nine years, Uber isn’t within hailing distance of making money and continues to bleed more red ink than any start-up in history. By contrast, Facebook and Amazon were solidly cash-flow positive by their fifth year.

The fact that this glorified local transportation company continues to be a financial failure should come as no surprise. What should be surprising is that the business press still parrots the fond hope of Uber’s management that the company will go public in 2019 at a target valuation of $120 billion. That’s well above its highest private share sale, at a valuation of $68 billion. And Uber’s management and underwriters will no doubt hope that the great unwashed public looks past the fact that more recently, SoftBank bought out insiders at a valuation of $48 billion, and its offer was oversubscribed. Why should new money come in at a price more than double where executives and employees were eager to get out?

Uber has never presented a case as to why it will ever be profitable, let alone earn an adequate return on capital. Investors are pinning their hopes on a successful IPO, which means finding greater fools in sufficient numbers. Uber is a taxi company with an app attached. It bears almost no resemblance to internet superstars it claims to emulate. The app is not technically daunting and and does not create a competitive barrier, as witnessed by the fact that many other players have copied it. Apps have been introduced for airlines, pizza delivery, and hundreds of other consumer services but have never generated market-share gains, much less tens of billions in corporate value. They do not create network effects. Unlike Facebook or eBay, having more Uber users does not improve the service.

Nor, after a certain point, does adding more drivers. Uber does regularly claim that its app creates economies of scale for drivers — but for that to be the case, adding more drivers would have to benefit drivers. It doesn’t. More drivers means more competition for available jobs, which means less utilization per driver. There is a trade-off between capacity and utilization in a transportation system, which you do not see in digital networks. The classic use of “network effects” referred to the design of an integrated transport network — an airline hub and spoke network which create utility for passengers (or packages) by having more opportunities to connect to more destinations versus linear point-to-point routes. Uber is obviously not a fixed network with integrated routes — taxi passengers do not connect between different vehicles.

Nor does being bigger make Uber a better business. As Hubert Horan explained in his series on Naked Capitalism, Uber has no competitive advantage compared to traditional taxi operators. Unlike digital businesses, the cab industry does not have significant scale economies; that’s why there have never been city-level cab monopolies, consolidation plays, or even significant regional operators. Size does not improve the economics of delivery of the taxi service, 85 percent of which are driver, vehicle, and fuel costs; the remaining 15 percent is typically overheads and profit. And Uber’s own results are proof. Uber has kept bulking up, yet it has failed to show the rapid margin improvements you’d see if costs fell as operations grew.

But, but, but — you may say — Uber has established a large business in cities over the world. Yes, it’s easy to get a lot of traffic by selling at a discount. Uber is subsidizing ride costs. Across all its businesses, Uber was providing services at only roughly 74 percent of their cost in its last quarter. Uber was selling its services at only roughly 64 percent of their cost in 2017, with a GAAP profit margin of negative 57 percent. As a reference point, in its worst four quarters, Amazon lost $1.4 billion on $2.8 billion in sales, for a negative margin of 50 percent. Amazon reacted by firing over 15 percent of its workers.

by Yves Smith, Intelligencer |  Read more:

Image: Ramon Costa/SOPA Images/LightRocket via Getty Images

Welcome to Our Modern Hospital

Where If You Want to Know a Price You Can Go Fuck Yourself

Welcome to America General Hospital! Seems you have an oozing head injury there. Let’s check your insurance. Okay, quick “heads up” — ha! — that your plan may not cover everything today. What’s that? You want a reasonable price quote, upfront, for our services? Sorry, let me explain a hospital to you: we give you medical care, then we charge whatever the hell we want for it.

If you don’t like that, go fuck yourself and die.

Honestly, there’s no telling what you’ll pay today. Maybe $700. Maybe $70,000. It’s a fun surprise! Maybe you’ll go to the ER for five minutes, get no treatment, then we’ll charge you $5,000 for an ice pack and a bandage. Then your insurance company will be like, “This is nuts. We’re not paying this.” Who knows how hard you’ll get screwed? You will, in three months.

Fun story: This one time we charged two parents $18,000 for some baby formula. LOL! We pull that shit all the time. Don’t like it? Don’t bring a baby, asshole.

Oh, I get it: you’re used to knowing a clear price for products and services. The difference is that medicine is complicated and scary — unlike, say, flying hundreds of people in a steel tube across an ocean, or selling them a six-ounce hand-held computer that plays movies and talks to satellites. Anyway, no need to think this through rationally while you’re vulnerable, right? Your head is really gushing, ma’am.

Sure we could start posting prices and discussing our costs, but then it turns into a public debate about transparency, and people get all huffy and self-righteous about $15 pills of Tylenol, $93 to turn on a single goddamned light, or $5,000 worth of sanitary gloves. We’d rather just mail you a bill later for $97,000, full of obscure medical codes you can’t understand. Oh, you like understanding things? Here, maybe this will help:

Hit your head, and talk to a doctor for one minute? $2,500, you idiot.

Want your pesky appendix out? That’ll probably be $33,611. Or it could be $180,000. Shrug. Don’t know. Don’t care.

Need an hour in the ER? How does $15,000-$50,000, sound? Hint: we don’t give a piss how it sounds you stupid fucking helpless human wallet.

Our medical system strikes you as “insane?” Well, you can’t do much about that now. Except of course to go fuck yourself. Yes, ma’am, as a matter of fact, we do have a special room where you can go fuck yourself. Yes, it does cost money to use the room, and no I cannot tell you how much. Want a hint? It’s between $1 and $35,000 per minute. Will you be reserving the go fuck yourself room?

by Alex Baia, McSweeny's |  Read more:

Image: via
[ed. See also: This horrifying account of trying to get mental health counseling and treatment: Case Study of 1.]

Shotei Takahashi, Japanese Radish, Rats, and Carrot 1930
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