Reich is not a Red, But an Optimist: On Saving Capitalism for the Many, Not the Few

First thing first, Robert Reich isn’t a red communist. The title of the book is “Saving Capitalism,” to get that point across. But there is further proof. There are multiple places where he defends Reagan’s firing of the air traffic controllers. He makes of point of saying in an aside that the strikers had no right to strike (129), but I would say that everyone has a right to withhold their labor in an action of collective will. It’s a weird aside and a debatable point, but just one of several places where Rob and I diverge. Another place is where he unquestionably praises large foundations like the Gates foundation (146), without noting that the political pushes in places such as school reform are part of the problem.

I mention all of this because for the most part, the book as a whole reads like a very learned critique of the capitalistic system as it exists in America today. A note I wrote myself is that Rob and I have some of the very same critiques, so it was treading familiar ground. The issue between us is if the capitalism that he wants to save is saveable. For the most part he holds up the economy roughly during the Bretton Woods system as one that we want to return to. I am doubtful that we can retur to that since we have moved more towards an information econimy than the industrial one we had back then. Reich acknowledged this, with a chapter later that looks at what can happen when the robots come and take all our jobs.

What I really like about this book is the framing that Reich uses. He emphasizes that the market is not free, so there is no real fight between the government and the free market, but that the free market is created by rules set by the government. There is no market without the rules, and the state makes the rules. Like I said, there is a lot of parallel between Reich and the Reds, but ultimately the question is if capitalism is saveable or if it is even worth it. The history he covers shows the swing between greater and lesser equality and more and less power for the people and the elites. The history is one of movements from the trust busting progressives to the new deal to the great society to what we have now with a  multiplicity of angry groups but little action. Reich sets a clarion call heeded by both the supporters of Trump and Sanders, keying into a populist anger, but even if successful I am not optimistic that in my lifetime we wouldn’t need new books that were sequels to the book - Still Saving Capitalism for the Many - because it is a great cycle.

Ultimately, he comes down on the answer that a basic income would be the best way to soften the blow to capitalism as it really exists. It sounds like a nice reform that would free up people from the worst excesses of capitalism, but it is just that - a reform. I don’t know if even the ambitious plan that he outlines in his prescriptive chapters is half implementable politically because they involve so much reform in the face of concentrated power and the people's power is diffuse and unfocused. That means that for the time being we will keep snipping at the edges. When it comes down to it, Reich is just so much more optimistic than I am.

A MIrror to Society: Megan Erickson's Class War

The mashup with Jacobin and Verso has been a continued parade of fresh new voices on the left, and Class War by Megan Erickson is another fine entry in the series.

What starts as a specific indictment of the current mania for privatization of the child through their means of education builds towards a critique of the patriarchy becomes at the end a critique of security as a whole - during the raising of our children into a mirror of the society we are, but also the society that we one day can be.

The only critique is that there are places where Erickson repeats herself, including information that she previously addressed without calling back to the fact that it was mentioned before. One example is the three times at least that she mentions New York’s Mayor Bloomberg calling for halving the teacher population. It is as if the sections were assembled separately and were later combined as a book. This is noticeable in the series in other books, even the apart from the one that is deliberately an anthology.

In spite of that drawback, the book is eminently readable. One thing that I love that is against some current trends is that it is footnoted and not end-noted, so that you can just look down at the references.

The Summit Bretton Woods, 1944 by Ed Conway: A Review

For whatever reason, I have not been very into the sausage making of monetary history. I am big on economics and following the current debates, especially in macro, but I have never read anything about the Bretton Woods conference. I have read a book that ends up with a very similar premise to this book, Keynes Versus Hayek, but the conference is just a footnote since it came near the end of Keynes’s life and it was tangential to that author’s purpose of playing up the continued importance of F.A. Von Hayek.

I say that that other book is similar as what this book boils down to is at its core a debate or jousting match of sorts between Keynes and his American counterpart Harry White as they hashed out the agreement that would carry the name of the area the hotel was in, and which was the global monetary policy for 25 years there when a lot was right with the world if you were a white male American. The framing of the two men at the center make the book a compelling read, if even the real action of the conference doesn’t start until about page 200. The prelude introduces the men and introduces the reader to global monetary history up to the point of the conference.

The only thing that centering the narrative on the participants and not the matters at hand do is perhaps obscure what was at stake at the conference. There is a lot of ink spilled over the fight that different countries would have to contribute to the Bretton Woods institutions (The IMF and the World Bank,) but if Conway really pulled back to examine it, my mind elided the reading of that section.   Instead we get a whole chapter and more detailing the possibilities that White was a Soviet spy of some sort.

Once the conference is over, there is an extended bit on the Bretton Woods system and its abandonment with the closing of the gold window and free-floating currencies, something that is more recent and more in my wheelhouse. There was only one troubling bit for me, right near the very end where the author is talking about the balance of payments and the resulting debt where he mentioned that China holds a third of the outstanding debt (403). The fact is that foreign holdings of US debt are only about half of the outstanding debt, and China only holds about a third of that. Japan also holds a similar proportion. This is not to catch the author out in a ah-a moment, but errors of fact  or lack of specificity like that bring into question the details covered that I don’t know the numbers on. Overall though, it remains an interesting book about a glossed over summit that should receive more attention.

I received a complimentary copy of this book for review from the publishers.

The Art of Selling Isn't Hard to Master

You are an executive director reporting to a board of directors. Your agency is facing some difficult economic challenges and of your 20 board members, only 5 donate more than $500 each year and it is not unusual for several others to donate nothing at all. The board does not have a formal “give or get” donation amount for board members, although it has been discussed – and rejected – in the past. Your board president is sympathetic to the problem but also feels like “most of the board members donate enough of their time and energy that it is too much to ask for their money as well”. You suspect that in reality the president is reluctant to try to address the problem and unsure how to go about it anyway. You need the board to increase their giving. What specific steps would you take to increase board giving?

The first thing that strikes me about this question is that the board seems very large. You want a multiplicity of voices on your board, but that may be a cacophony. Part of me would think that the board is too big, but I would put a pin in that and perhaps address that later.

For me, coming from a financial perspective, I would center my argument towards the board president. He is sympathetic, but already comes loaded with excuses. It would depend on the organization’s mission and the board make up, but my first look in this situation would be to implement a formal give or get.

I’m not much of a salesman, but I would talk to the president. I’m not sure what his or her financial background is but I would lay my case to them in as stark terms as possible. Look, we have issues where the government is trying to cut us, giving is down, the staff is grumbling about another year of no pay raises. I’d use numbers and pie charts to show the depth of the financial issue.

Because the bottom line is that people are on the board for various reasons, and it is not just altruism. There is a time commitment, but the staff and the clients are feeling a real problem with the monetary issue. They are making sacrifices every day, Madame Board President. That other members of the board don’t want to contribute on a consistent basis. They like feeling nice that they are helping us out just by their presence. There’s one that that is the ultimate current, and they aren’t willing to sacrifice.

You see, I’d say, you and the other board members have be the ones who lead. If you go to  friends in industry and ask them to give, you know what the first question will be? They’ll ask you how much you give. How can you sell the agency when you haven’t fully bought in. No one understands time and money constraints like a nonprofit Ed does, Madame Board President, I’m asking for your help.

And my good sales job would make her see the error of her ways and become a convert to my side, leading the charge for a give or get that is relevant to the size and scope of the agency’s mission.  Even better, when it comes to the meeting, it will look like her idea when it comes up and I’ll have a powerful ally. Then if people still don’t buy in, I start figuring out how to get rid of the deadwood and bring in my own people.

Goal Setting

Find the Target

In my organization, I have long been an advocate of Hofstadter's law, named after a data scientist. The idea is that things will take longer than you think they will, even knowing that they will take longer than you think they will.

That law is sort of defeatist, and I've hated it though I have embraced it, Today I came across something I like much better. Though it frames the same idea, it is much more optimistic, I have been reading Peter Drucker's "Managing the Nonprofit Organization," and he says the following: "One should always set the objective twice as high as one hopes to accomplish because one will alway fall 50 percent short." 

I like this because my previous formulation had always been short and cynical, but Drucker's re-framing makes it so that it is just another way to meet you goal. 

Risk Management with Known Risks: Volkswagen

One thing about the Volkswagen issue is that the executives seem to have been caught flat-footed on the whole thing. It is as if they never expected to get caught. I mean, even if you're not engaging in widespread corporate malfeasance, don't you have some sort of risk management plan in place?

You're not going to call it "Plan for when we get caught cheating on emissions tests" but that could be one of the conditionals that are planned for. It's just bad practice. Gaming possibilities is a policy decision that needs made. I was reading where even as of 1945 America and its allies were planning on contingencies for a possible German victory. And that was America, who can never lose. Man, these Germans never learn.

Market Skeptics: Akerlof and Shiller's "Phishing for Phools"

Akerlof and Shiller between them have as many Nobel-Branded Prizes as Marie Curie did, so each of them are half a Curie.

Basically, this book tries to take the biases that are built into humans and look at economics from the top-down with behavioral factors, instead of from the bottom up. It made me make a joke about behavioral economics without microfoundations.

The examples the authors use show how people take advantage of people’s not being poerfect economic actors and instead work against their best interests. They like using Cinnobon as an example of how this market works, in that someone would be out there with a similar product. You choose a fatty roll not because you have thought through the transaction, you have been Phished.

If you haven’t read much behavioral econ, it is a good start in spite of the goofy title. My only real complaint is that the chapters aren’t fleshed out. The content of the book is only like 175 pages and that covers like 13 sections. I should have checked out the almost 100 pages of notes plus index which makes the book feel more hefty - I was at the end when I realized i should have been reading the book like “Infinite Jest”.