"Doug's" Version of Derb's "Cold Civil War"

OK. So I was clicking back on a series of links from Dear Old Derb -- John Derbyshire to you -- on his "Cold Civil War" meme. And he quoted this piece from a comment by "Doug" at EconLog :

Let`s say you were to immigrate to a new country which is essentially divided between two hostile tribes engaged in perpetual low-intensity warfare. We`ll call them Hutus and Tutsis. You have no previous allegiance or affiliation with either tribe.

Let`s also say that one tribe, Tutsis, holds a hegemony on all organs of education and opinion, virtually the entire government bureaucracy and all of popular culture. Many of the most prestigious institutions in the country consist of 95%+ Tutsis. Tutsi organizations like “Harvard University” and “The New York Times” are widely respected by even ardent Hutus.

Now of course there are Hutu organizations and no shortage of powerful Hutu people. But, unlike the reverse, there are virtually no prestigious institutions where Tutsis are excluded. I.e. some prestigious and powerful institutions, like “General Electric” or “Goldman Sachs” may be 2:1 Hutu at most. But any with a 10:1 ratio or more are virtually guaranteed to be far inferior, second-rate and low status institutions or organizations. Examples of these pariahs are “Oral Roberts University”, “Fox News” and “Amway.”

This leads to a strange asymmetry where it is certainly possible to succeed in this society while being Hutu, it almost never hurts to be Tutsi. For example just the other day there was a Tutsi ceremony called “The Academy Awards” that almost exclusively honors Tutsis. Despite this, this ceremony is observed and recognized by Hutus around the country.

A rational, self-interested immigrant to this society would of course choose align himself as a moderate, but reliably loyal Tutsi. Unless you`re a Tutsi extremist, leaning Tutsi will almost never hurt your career or standing except in all but the most malformed, backwards and irrelevant Hutu organizations.

But failure to demonstrate at least general sympathy to the Tutsi side will almost undoubtedly lock you out of many career options and generally draw attention to you in most corners of polite society.

Oy. And Oy. When you read that you think to yourself: why do  I bother? Why belong to the Out group when the scales are so decidedly set in favor of the Ins? Why not just chuck it in and join the progressive ruling class.

OK. There was one thing that is almost encouraging. Doug points out that the "rational, self-interested immigrant" notices that the institutions that are 95% Tutsu are often highly successful places like "Harvard University" whereas institutions that are 95% Hutu are often places like "Oral Roberts University" or "Fox News." Why would you want to associate with Hutus?

But you know what? I think that the 95% game is a mistake. Because the 95% institutions are becoming stupider over time. That will happen to you when you shut yourself up away from the push and shove of opposing ideas. It's better to live in the open-outcry world and deal with the opposition mano-a-mano. You know what I mean: inbreeding; Hapburg lip, etc.

Having said that, the question remains. Why would any discerning immigrant align with the Hutus? In Sean Trende's handy election calculator we get the 2012 presidential election results as: Blacks: 94% Dem; Hispanics: 72% Dem; Asians: 68% Dem.

What is wrong with these people? Why don't they all vote 94% Dem like the African Americans?

I suppose the answer is that the advantage of identifying Tutsi only applies if you are a top-level ruling class type or if you are a client of the welfare state on benefits. And so about 30% of Hispanics and Asians voted for the GOP in 2012, because, well because they actually believe in truth, justice, and the American Way, even if it doesn't pay. There will, of course, be more of them in 2016.

Will #BlackLivesMatter Split Blacks in 2016?

I get the Black Lives Matter movement. Back in 2009 African Americans thought they had gone to heaven. Something had happened that they never thought that they would see in their lifetimes. A racist America had elected its First Black President.

Unfortunately, nothing has changed. African Americans kids still do badly at lousy urban schools. 70+ percent of black babies are still born out of wedlock. Rampant violence still obtains in African American neighborhoods.

And of course African Americans got hammered worse than most by the housing meltdown because Democratic housing policy decreed that they should get low-down mortgages even though they didn't really qualify for them. So they lost everything when the housing market collapsed (Still, you can imagine the house hunger among African American women must be huge).

And, of course, we have President Obama and the US Justice Department feeding black frustration about urban policing with Alinsky-style community organizer rhetoric.

Wanna know why blacks are so angry about the po-lice? The problem is that blacks don't testify against their local hoodlums because the gangs intimidate them. So the police arrest the hoodlums for minor offences. So the average black is mad that the police don't solve the murders but is angry that the police harass young black men "for driving while black." I've written about this before.

The racist rhetoric from President Obama makes sense, from his point of view. Since he has done nothing for African Americans he has to keep them angried up about racism. Otherwise they ain't gonna come out to vote in 2016.

But maybe Black Lives Matter is not such a good idea.

Two out of three black people prefer the term “all lives matter” to “black lives matter,” according to a Rasmussen poll[.]

This means that Republicans have a chance to split the black vote (which will be demoralized anyway in 2016).

African Americans have voted with remarkable tribal unity since the end of slavery. First they all voted Republican and the Republicans left them to the tender mercies of Jim Crow after the dead-heat 1876 election. So that worked out real well. Then they all voted for FDR and Democrats and the benefit state. And LBJ and the affirmative action state. And Barack Obama and the First Black President state. The result is that Hispanics and Asian immigrants are eating their lunch. So the black love affair with the Democrats has ended up no better than their earlier fling with Republicans.

One fine day African Americans will realize that government benefits are a poisoned chalice. They will realize that politicians and activists don't care about them; they only care about their vote. And on that day, they will finally be free.

You Can't "End the Fed" Unless You "End Big Government"

Count me as a critic of the Federal Reserve System. So I should be encouraged by the recent Jackson Hole Summit held by critics of the Fed at the to coincide with the Kansas City Fed's traditional August symposium at Jackson Hole, Wyoming.

Here's John Fund in National Review. 

A growing number of people believe the Federal Reserve has hurt rather than helped the recovery. It has pursued zero-interest-rate policies that have perversely made it impossible for many businesses to get credit to expand.

Here's Chriss W. Street in Breitbart writing about Ben Steil, speaker at the critics' "sold-out" Summit. Steil blames it all on the Bretton Woods monetary conference at the end of World War II.

Keynes fully understood that although Bretton Woods claimed to be establishing a post-war economic order where the value of money would be fixed, the agreement gave governments a capability to unfix monetary values every time there was a “crisis”.

And then there is the perennial critic of the Fed, Ron Paul, with his critique on fractional reserve banking.

OK. So why is the Federal Reserve persisting with its zero interest rate policy? Probably because it cuts about $500 billion a year out of the federal government's interest rate cost.

And why did Bretton Woods usher in an ability to "unfix monetary values?" Because modern big government is always getting in a jam, and the easiest way to get out is by devaluation of the currency.

Originally, central banking was invented by the Dutch to help them fight their war of independence against Spain. Central banks are good for managing the government's debt and helping create a market for the national debt. The Brits liked it so much that they founded the Bank of England in the 1690s and then went out to fight and win the Second Hundred Years War against the French at the end of which their national debt hit 250% of GDP.

Alexander Hamilton knew about all this, and that's why he founded the Bank of the United States.

All very nice, but you can see that the central bank is clearly intertwined with the credit needs of the government. In fact a central bank merely formalizes the fact that in a nation state the credit system is subordinated to the needs of the government. One could say that in wartime the credit system must be subordinated to the needs of the government. And once that principle is established, it's hard not to use the power in peace time.

I would say that the rise of the welfare state means that now the credit system must be subordinated to the needs of the government even in peacetime. The best way to get a handle on this is to use Ludwig von Mises' term for the modern state: the interventionist state.

The modern state intervenes in all economic relationships, favoring one party here and another party there. The result of this interventionism is that the modern state is always unbalancing the economy, always setting it up for failure. The obvious recent occasion for this was the Crash of 2008 caused by the unbalancing of the credit system in the US by the promotion of low-down-payment mortgages for people with bad credit. Came the day when these borrowers couldn't service their mortgages; then came the day that their foreclosed mortgages couldn't be liquidated. Result: the worst financial crash since the Great Depression of the 1930s.

Why is that a problem? I go to Lombard Street by Walter Bagehot. He wrote that a healthy credit system needs two things: people that can be trusted to make their payments, and loans that are adequately collateralized. If you don't have that then you'll get a crisis of confidence that might develop into a full-scale panic.

These days everyone thinks that they are qualified to intervene in the economy and disturb ordinary economic exchange relationships. Politicians, activists, and subsidy seekers all think it is the right thing to do to muck around with the credit system to advance their agenda. So long as that culture obtains we will need a central bank "to unfix monetary values every time there [is] a 'crisis'."

Unwind big government; undo crony capitalism. Then you can think about "ending the Fed."

But you'll still need some sort of "lender of last resort" to right the system after a credit crisis. And you'll still need a way of mobilizing the nation's productive capacity in the event of war.

NYT Readers Aren't Buying Trump

Conservative pundits at the New York Times like Ross Douthat and David Brooks have a delicate task. They are talking to people that live in a liberal echo chamber, hearing nothing but Democratic talking points all day long, from the New York Times and from NPR and from all their liberal friends. They have to introduce conservative themes very carefully, otherwise they'll lose their readers at the first fence.

So what does Douthat do when he wants to talk about Donald Trump? He compares him to Franklin D. Roosevelt as "Donald Trump, Traitor to his Class." Having got that out of the way he talks about the failure of third parties recently to get their agenda adopted by either of the two major parties.

Across the latter twenty years, the country has endured a series of disasters that had bipartisan fingerprints all over them. Yet the various movements that have arisen in reaction to those failures — the antiwar left, the Tea Party right, Occupy Wall Street – have yet to even unseat an incumbent president, let alone change the basic lines along which the two parties debate.

The question is: will the GOP elite adjust its message to the Trumpian evidence that the base is restless, or will it crush him and ignore his message.

In which case the pressure the Donald has tapped will continue to build — and when it bursts, the G.O.P. as we know it may go with it.

Fair enough. But when you read the comments of the NYT faithful you get nothing but Democratic talking points. They basically think that Trump will destroy the GOP and a good thing too.

Trumps rebellion against the Establishment is not merely rebellion against his class, it is rebellion in favor of all the insanity the Republicans have fed for decades now. It is come for them, like Frankenstein's monster. 

To the NYT reader, the GOP is a despicable institution that has been mis-leading its voters with "code words and dog whistles" and Trump is just saying it "loud and proud."

Needless to say, the NYT readers do not think that Trump is in the same league as FDR!

So, the NYT chappies are all sitting as contentedly as cuddly teddy bears in a safe space. What about the real world?

The truth is that we don't know. We have polls showing that the American people definitely think that things are on the wrong track. And 71 percent think that "political correctness" is a problem.

Meanwhile over at the American Spectator David Catron is warning that the GOP is terrifying Hispanic voters over immigration and if Trump wins he'll hand the election to the Democrats.

OK. Let's look at the last few decades using the "I can't take it anymore" philosophy of George Maroutsos.

In the Seventies conservatives decided they couldn't take it any more and overrode the liberal consensus and elected Ronald Reagan. Reagan was so successful that the Dems in 1992 had to pretend they were New Democrats that had learned the Reagan lesson.

But by 1998 and the impeachment they decided they couldn't take it any more and reverted to type. In the early 2000s we had a sort of truce and passed Medicare Modernization with Medicare Part D Drugs and No Child Left Behind. But with George Soros egging them on and the Iraq War and the Netroots and all, the Democrats decided they couldn't take it any more and they elected a real lefty in 2008 (who pretended to be a centrist until he was elected).

In the wake of the Crash of 2008 Tea Party types decided that they couldn't take it any more and anchored the big Republican swing in 2010. But the wave was rather diminished by attacks from both sides of the establishment -- Hello Lois!

But now in 2016 both Democrats and Republicans have decided that they can't take it any more. So candidates on both sides are swinging for the stands hoping for a two or three run homer -- or a strikeout.

The point is that the political establishment in both parties would rather avoid putting the big hitters up to bat. That sort of a game is too risky. That's what Clintons and Bushes and Romneys are all about.

But sometimes the voters just get so pissed of that they say, channeling Vox Day: We Don't Care.

And I have a feeling that is what is happening for 2016. NYT readers are in their safe space and conservatives are all watching Fox and The Five. What do the LoFos in the middle think? We don't know, and they won't know until the summer of 2016.

But remember this: people may be all upset, but they still want their Social Security, their Medicare, and their mortgage deduction. And that means they still want Big Government.

Uh Oh. Peggy Noonan Goes Trump

For years I've used Reagan speechwriter Peggy Noonan as a weathervane. When Peggy writes about something in her weekly Wall Street Journal column then it's just gone mainstream.

Today she's writing about Donald Trump and how Hispanics aren't offended by him. She talked to her friend Cesar after the first GOP debate and he told her about a Hispanic call-in show right after the debate.

More than half called in to say they were for Mr. Trump. Their praise, Cesar told me a few weeks ago, dumbfounded the hosts.

What about after Trump dissed Jorge Ramos? A majority of callers backed Trump. What is going on here? Aren't Hispanics supposed to be offended by Trump?

Cesar shook his head: No, you have it wrong. Immigrants, he said, don’t like illegal immigration, and they’re with Mr. Trump on anchor babies. “They are coming in from other countries to give birth to take advantage of the system. We are saying that! When you come to this country, you pledge loyalty to the country that opened the doors to help you.”

Makes sense to me. After all, if you've gone through all the horrible bureaucratic process to immigrate legally, you sure don't appreciate people that are crashing the line.

On the other side we have chaps like Sam Tanenhaus talking about the Jesse Jackson party that the Democrats have become. And then there's Howard Fineman. Talking about Joe Biden, who's from the old labor-union Democratic Party, he writes:

He’d also have to somehow reach out to a new version of the party that is out there waiting to be born. It is a yet-to-be-defined mashup of Black Lives Matter; pro-immigration activism; non-European cultural consciousness; tolerance of all religions, lifestyles and genders; genuine urgency about the fate of the planet; confidence in technology, social media and the sharing economy; and skepticism about America’s right, power and duty to lead the world.

Hmm. Richard Fernandez writes that Fineman's "vision of the Democratic Party hoping to be born is actually the one waiting to die." Come on, Howard. The Democrats have been doing the whole "progressive" thing since 1998 and the Clinton impeachment and the birth of MoveOn.org. The problem is that, given the decline in Democratic strength in legislatures all across the nation, it looks like the American people really don't like the Democratic Party "waiting to be born."

All I know is our Mexican mailman's family. He was a high-school dropout back in Mexico. One way or another he's got his whole family over here, legally. His two daughters are going to college here in Washington state. I don't think that his children will find much in common with Black Lives Matter, for a start.

Peggy writes that "America Is So in Play." That means, of course that the whole vision of the emerging Democratic majority is baloney. And you can see why. President Obama's divisive presidency has riled up the people that thought that race politics was over now that we had elected our First Black President. And now they want out.

The Democratic Party is an over-under coalition in which the People of the Creative Self angry up the People of the Subordinate Self to stay on the liberal plantation as clients of their liberal patrons and give power to the creative elite. This cunning plan founders on the fact that most subordinate, marginalized people want to get out of the liberal plantation, get a good job, buy a modest home, and live in the suburbs, and hope that their kids will do better than they did.

Sooner or later, most immigrants become the African American woman I profiled yesterday: Peggy Hubbard. They become People of the Responsible Self. That is why Democrats are so pro-immigration. They need a new supply of People of the Subordinate Self from pre-industrial nations to replace folks like Peggy Hubbard.

A Black Poster Girl for my "Three Peoples" Theory

My Big Idea to explain everything is to say that there are three kinds of people in the world. Let us call it the Three Peoples Theory.

There are the People of the Subordinate Self, your eternal peasants, the clients in the patron-client relationship. They are people that experience themselves as victims, tossed about by irresistible forces.

Then there are the People of the Responsible Self, the classic bourgeois, that experience themselves as responsible individuals. Finally there are the People of the Creative Self, your artists, intellectuals, political activists, and such.

We know what a person of the subordinate self looks like. He looks like the clueless African-American failed TV journalist that shot two white TV journalists to start a race war. Just like the clueless white guy that shot and killed people in Charleston, South Carolina, in order to start a race war.

Hey, how about that iconic tweet:

The best part about the Obama era is all the racial healing.

But here's a rant by a black woman, Peggy Hubbard, who is about as clear a card-carrying member of the People of the Responsible Self as you could imagine.

Police brutality? How about black brutality? You black people, my black people, you are the . . . most violent [people] I have ever seen in my life. A little girl is dead. You say black lives matter? Her life mattered.

Notice one little thing in that quote. Peggy doesn't say Black Lives Matter. Or even All Lives Matter. She says Her Life Mattered, that individual that just got killed. But here is the money quote:

Excuse me, but I didn’t know there was a side to be on. Only thing I know is I see right, and I see wrong. I see good, I see bad. This is not a race issue, and it never has been a race issue. People made it about race. This is not about race. This is about morals. This is about accountability and responsibility. We have to be responsible for the things we do and the things we say.

 See that? "I see right, and I see wrong." And then "This is about accountability and responsibility. We have to be responsible for the things we do and the things we say."

Of course, as the People of the Creative Self are so fond of telling us, there is no such thing as right and wrong. Moral codes are social constructions, just like everything else except climate change and racism, sexism and homophobia, which are just Wrong and Hateful and Divisive. And nobody can truly be accountable and responsible in this world of oppressions and exploitations.

People that belong in each of the Three Peoples buckets are all living a fantasy. Subordinate people are not as helpless as they think. Responsible people are not as individual as they think. Creative people are not as creative as they think. We are all bound to the facts of the material world. John Gray in The Silence of Animals addresses this. He writes that the "dystopia of power," that "two and two is five" if the Party says so, "is a fantasy." Nor is Dostoyevsky right when he argues in Notes from the Underground that freedom is nothing if we can't push back against the laws of nature.

Yet the two projects serve the same infantile fantasy: the magical omnipotence of thought. Whether affirmed in terms of classical logic or denied in those of romantic will, the message is the same: the human mind is the measure of reality. 

And yet the human mind is the means by which we negotiate reality; in order to act in the real world we must each of us develop a world-view that pretends to understand that reality and its meaning.

Some people say that only Black Lives Matter and the police are out to get black people. Some people say that individual accountability and responsibility for individual acts are the only thing. Some people say that creative or romantic will is the only thing.

But I say that the first thing is to teach the People of the Subordinate Self how to grow out of clientism into the bigger world of individual responsibility. The second thing is to teach the People of the Responsible Self that the world is not just about good and bad and responsible acts; it is also about the liberating serendipity of the creative act. The third thing is to teach the People of the Creative Self to stop exploiting subordinate people by inflaming their tribal instincts with social-justice politics, and to learn a little compassion and understanding for the worthy, if narrow, People of the Responsible Self.

But the words of Peggy Hubbard are a start.

Rap, Race, and Homicide Rates

If you read the excellent The Better Angels of Our Nature by Steven Pinker you will learn three important historical facts about homicidal violence.

Fact One is that death by violence in the hunter-gatherer age was about 500 per 100,000 population, or about 0.5 percent per year.

Fact Two is that death by violence in the late agricultural age was about 50 per 100,000 population, or about 0.05 percent per year.

Fact Three is that death by violence in the mid 20th century (after World War II) was about 5 per 100,000 population, or about 0.005 percent per year.

I discuss all this in my "Government and the Technology of Power."

It makes sense, because in the hunter-gatherer age practically every adult male was involved in defending the tribe from the next tribe over, and Pinker tells us that each tribe was more or less constantly at war.

But in the agricultural age the political units were bigger and most of the fighting was done by "marcher lords" and their retainers. Think the Percys, Dukes of Northumberland, keeping the pesky Scots out of England.

In the industrial age political units were bigger still, and with wealth now consisting of ideas in peoples' minds rather than broad rich acres, violence went down again.

But not, as Steve Sailer writes, in Straight Outta Compton during the crack age around 1990. He shows Figure 22b Black male homicide offending rates by age, 1980-2008 from the Bureau of Justice Statistics "Homicide Trends in the United States 1980-2008." He shows black homicide offending rates for age 18-24 at about 350 per 100,000 during the early 1990s and the peak of the crack epidemic and gang wars and gansta rap craze.

Which makes sense, because huge numbers of young black males were probably engaged in or affected by the crack business and living in a small tribe that had to defend itself against all comers.

The black male homicide rate in the early 1990s was about ten times the white male rate, which peaked at a little under 35 per 100,000 in the early 1990s. The black female homicide rate was about the same as the white male rate. The white female rate showed no bump during the crack age and remained under 3 per 100,000.

Really, the homicide rate is an inverse measure of embourgeoisification. Bourgeois males don't kill each other, they compete instead for promotions and market share.

Of course they do take on gunmen in trains, some of them. But that is another story.