The Symbolism of the Swedish Economy and the Consequences of Failure

Sweden is officially experiencing deflation.

Bulgaria is experiencing 2% deflation. Bulgaria is much poorer and any economic pain in Bulgaria will cause much more suffering there than in Sweden. So if you're reading for purely humanitarian reasons, feel bad for the Bulgarians.* But I don't have much to say about Bulgaria, so I want to talk about Sweden. Actually I'd like to talk about "Sweden"

In a certain kind of informal political discourse, "Sweden" stands for a kind of center-left dreamland. "Oh you know, I like the way they do things in Sweden" is a smug euphemism for "I'd like it if 50% of GDP went to taxes. It works very well in practice." Don't get me wrong, I "like the way they do things in Sweden" too and I'm glad to have "Sweden" in my arsenal of cheap rhetoric.

But if the real Sweden falls into a deflationary spiral, then soon enough "I like the way they do things in Sweden" could make you sound nuts, or at least ignorant. And that's a big deal.

Political questions are, in general, difficult. And we don't have many resources for resolving disagreement. For instance, there isn't much folk wisdom that will tell you the best kind of healthcare system, and there aren't randomized controlled trials for how to tax capital gains. We go with what little we have.

And part of the little bit we have is the experience of different places and different times. None of this is ever definitive, but it would be insane to ignore it. So it's entirely rational to look at conspicuous examples in trying to understand politics.

The respective legacies of Franklin D. Roosevelt and George W. Bush are both illustrative examples.

Franklin D. Roosevelt laid the foundations for the American welfare state. There are strong economic forces pushing countries towards social insurance, but the New Deal was not inevitable. And it was not inevitable that the Republican party would accept the New Deal under future presidents.

But FDR was an exceptionally popular president. Voters loved him! He got America out of the depression! He led the allies to victory. In reality FDR saved the economy by taking America off of the gold standard, and he did so on pretty idiosyncratic grounds, to put it politely. And it's hard to imagine a plausible scenario where the Allies lose World War II because of a different American president. Still, nothing succeeds like success; The New Deal survived long enough to become the status quo of American politics.
In contrast: George W. Bush was a terrible president. The Iraq War was a catastrophe, Katrina was a disaster and the economic crisis has made the whole world permanently poorer.

It's one thing that Democrats hate Bush for his failings, but it's pretty clear that much of the right does too. The Tea Party has been the animating force in the Republican party since the beginning of the Obama presidency and they stand for the parts of American conservatism that Bush tried to repudiate. Namely, they stand for libertarianism and white identity politics. Bush was certainly not a libertarian. He may have been against taxes, but he was certainly a fan of spending. He even expanded Medicare to pay for prescription drugs. And Bush, for all his failings; supported immigration reform, instead of demonizing "illegals". It's no coincidence that American conservatives are looking at isolationists like Rand Paul in foreign policy either.

Even here in Canada, I'm sure that many young people developed a permanent distaste for conservatism because of Bush. I know I did.

And I can't prove it, but I've often wondered if the United States is so reticent about government involvement in healthcare for the same reasons Canadians are so complacent about theirs: they're only familiar with each other's. This might be unsettling to the kinds of people who put huge Canadian flags on their backpacks when they're traveling, but Canada's healthcare system is sort of terrible. Canadians only feel proud of their system because the United States is such an international outlier in ugliness, cruelty and inefficiency. Canadians throw up their hands as if waiting lists were a necessary trade-off. But the UK doesn't have our waiting lists, and their healthcare system is dominated by the government to a much greater degree than Canada's. We just reason from conspicuous examples.

More generally, there's pretty strong evidence that people use similar kinds of heuristics when they vote. The world is a complicated place, so people vote for the incumbent when the economy is good, and they vote for the challenger when the economy is bad. Seems reasonable!

We can't do anything about what happens in Sweden. But I think we should be ready when Sweden tanks, if it does. It won't tell you much about the viability of their social model; Sweden's failings in monetary policy are real. Unfortunately, that's really, really hard to explain. Experts don't even agree on the mechanisms of monetary policy, much less on what optimal monetary policy looks like. It's difficult to even explain why deflation is bad, if you've taken the extreme step of boring your friends by talking about monetary policy.

My friends, it looks like we might lose a piece of cheap rhetoric to our enemies.

Moreover, we should always remember that good performances mean a lot in politics. A movement in a democratic society that doesn't take governance, and monetary policy, seriously will have to rely on lucky breaks.

* (Although if we follow that logic, you should feel bad for kids with worms and you should give them twenty dollars.)

Would Frank Ramsey Discuss Himself Today?

Frank Ramsey was a philosopher and economist who accomplished more in his 27 years than most people do in a lifetime, including the first English translation of the Tractatus logico-philosophicus.

His work is too technical for me to understand, with the exception of a speech he gave, appropriately, about how every subject is too technical for most people to understand. That speech was delivered to the Cambridge Apostles, an elite discussion group whose members have included Henry Sidgwick, Alfred Whitehead, John Maynard Keynes, and Amartya Sen. The speech can found in the epilogue to Ramsey's Foundations of Mathematics. Hopefully the link to Google Books works!

You should read the whole thing. Don't worry if the first paragraph makes no sense to you, but worry a great deal if the last paragraph doesn't either.

Ramsey thinks that only experts can fruitfully discuss "science, philosophy, history and politics", but he thinks that "psychology and aesthetics", are not possible subjects of discussion either. According to Ramsey, for one thing, aesthetics reduces to psychology and when we discuss psychology, we're simply "comparing notes on our experiences", and that discussing aesthetics, (e.g. discussing a novel) is really just expressing how we feel about the work.

Is it worthwhile to "compare notes on our experiences"? This question is more important than it sounds, so keep it in mind. Ramsey is skeptical about comparing such notes, because his experiences with psychoanalysis convinced him that we just don't understand ourselves. Today, psychoanalysis is more the province of film critics than psychologists, but contemporary psychology suggests an even more radical image because of

(1) Evidence that we are "dumbfounded" when asked for justification of some moral judgments: When researchers asked subjects why it's wrong to, for instance, clean their toilet with a national flag, people didn't respond with reasoning or principles, but rather bald assertions ("Because it's wrong!") or just silence.

(2) Evidence from Michael Gazzaniga's celebrated results with split-brain patients: People with intractable epilepsy are sometimes treated by having their corpus callosum surgically severed, separating the left and right sides of their neocortex. These patients, under controlled circumstances, act as if they have two minds, largely unaware of the other. Importantly, when research subjects are confronted about their behavior, they'll rationalize it, rather than admit that they don't know why they are behaving so strangely.

(3) Evidence from Korsakoff's syndome, and its associated behavior. People with certain kinds of brain damage suffer from anterograde amnesia, like the guy in Memento, except they don't know that they're amnesic. That might sound paradoxical. After all, how could you not know that you don't remember something? People with Korsakoff's syndrome solve this paradox by simply making things up!

(4) Evidence that we are radically wrong about what will make us happy. For instance, lottery winners are no happier than the average person, and amputees are no less happy than the average person. In the language of psychology, we aren't very good at "affective forecasting".

(I don't have references, because I'm lazy, but you can find information about (1) in the works of Jonathan Haidt, and you can find information about (4) in the work of Daniel Gilbert, if you're interested. Other, more mundane examples can be found in popular books about psychology, such as the work of Oliver Sacks.)

Together this evidence suggests a picture of human experience that I'd like to call the Ignorance-and-Confabulation thesis. To wit, proponents of this thesis believe that we are ignorant about our own mental life, and that we confabulate when asked to account for our thoughts, judgments and experiences. We are just like the pathological cases, except we're better at rationalizing, and better at confabulating. Again, I'd like to emphasize that the modern incarnation of the Ignorance-and-Confabulation thesis echoes psychoanalysis in many of its implications; even if you reject psychoanalysis, Ramsey's concerns still resonate.

The Ignorance-and-Confabulation thesis, of course, implies that "comparing notes on our experience" is a waste of time. We just bullshit ourselves, and then let people know about our bullshit, so they can imagine we said some other bullshit. To be specific, our views about morality, aesthetics, and the trajectory and meaning of our lives is just a bunch of bullshit.

It strikes me as a pretty depressing view. Ramsey's view is slightly different, but mostly in affect. He thinks we can share our feelings, and that it's good to be happy, and that philosophy, as an activity, can cure us of our unhappiness. I read the end of his essay as an exuberant attempt to make explicit what Wittgenstein tried to show, but your results may vary.

If the modern Ignorance-and-Confabulation view is correct, it's unlikely we can even share our feelings, which casts a pall over Ramsey's exuberance anyway.

Ignorance-and-Confabulation is an appealing picture for those who seek an austere, properly scientific worldview, and it's an even more appealing picture for those who've rejected religion, and are looking for more things to reject.*

But I think it's a picture we should resist.

I don't think we should resist it because it's depressing. If anything, proponents probably find it more compelling because it's depressing.

If I wanted to take a cheap shot, I'd point out that scientific knowledge relies on the kind of informal, non-scientific thinking that Ignorance-and-Confabulation rejects. But you could bite the bullet and say that informal, non-scientific thinking is only useful insofar as it historically undergirded the rise of science. That would be a shaky argument, but it wouldn't dispel the Ignorance-and-Confabulation picture when the evidence feels so suggestive.

But that evidence isn't definitive.

(1) The apparent dumbfounding in the face of moral confusion should certainly make us skeptical about whether we should trust moral judgments that are purely motivated by disgust. But these experiments only succeed in strange cases. In regular cases, people are perfectly capable of reasoning and applying principles in their moral judgments. Those judgments might be preceded by activation of regions of the brain responsible for feeling, rather than thinking, but would anyone think that it's impossible after serious, conscious deliberation to overrule or change their feelings?

(2) and (3) are certainly interesting, and I think they tell us something about what it is to be a normally functioning person—not because we are reflected in these pathological cases, but because we are not. That tells us that our ability to accurately describe our own behavior depends on certain kinds of mental functioning and anatomy.

(4) is an interesting example, because it is non-technical enough that it's become common knowledge among educated people, to the point where it's a a caveat in most advice. I think this shows that there isn't a perfect delineation between scientific and non-scientific knowledge. (4) is an example of how scientific knowledge can be superior to non-scientific knowledge, but it's also an example of how scientific knowledge can inform informal discussions.

So I don't think Ignorance-and-Confabulation provides an accurate picture of human experience, and obviously, I don't think psychoanalysis does either.

And I think that's a very good thing, because I think some kinds of knowledge are best nurtured by experiencing life, falling in love, working, reading Shakespeare, cultivating friendships, and eating well—all while exchanging notes with the people around you.

*If you think I'm creating a straw man, check out the philosopher Alex Rosenberg. More pertinently, I feel this view is worth addressing because I myself feel its pull.

Houses Divided in Canada, America and the United Kingdom

In the latest New York Review of books, Jonathan Freedland has an article explaining the upcoming vote on Scottish independence to an American audience. It's worth reading the whole thing, but I'd like to focus on one issue. According to Freedland, the Scottish independence movement is not based on "The Braveheart notion of Scottish nationalism—spear-carriers, faces painted in woad, crying freedom against the English oppressor", but rather on a civic nationalism that is increasingly different from England's finance-driven, elitist, liberal democratic politics:

For the Nationalists, Scotland has become a land of social democratic consensus, one that believes it has more in common with the high-tax, high-spend northern neighbors of Scandinavia than it does with the turbo-capitalism of the City of London. “There is a strong sense that the UK is evolving towards the US model, where you can never give enough to the top one percent,”

I couldn't help but think of differences in political culture that I'm more familiar with. Namely, the differences in Quebec, and in the southern United States, specifically.

Let's start with a quote from dreamy Liberal Party leader Justin Trudeau.

“There is a way of viewing social responsibility, openness to others, a cultural pride here in Quebec that is necessary to Canada,” he told talk show host Franco Nuovo, a well-known Quebec nationalist writer. “And I always say that if I ever believed Canada was really the Canada of Stephen Harper and we were going against abortion and going against gay marriage, and we were going backward in 10,000 different ways, maybe I’d think of wanting to make Quebec a country.”

Trudeau's quote, if anything, underplays the difference between Quebec and the Rest of Canada. Quebec plays an interesting role in Canadian politics because public opinion in Quebec usually pulls the ROC in a social-democratic direction. Thus, it's easy to think that Quebec is simply more left-wing than the ROC, in the same way that Alberta is simply more right-wing than most of Canada. In other words, Quebec doesn't differ from Canada qualitatively.

I don't think that's correct. Quebec leans more towards continental laïcité and dirigisme than Anglosphere secularism and liberalism. The controversy over Quebec's secular charter is a great example of this. As Andrew Potter argues: it's easy to dismiss supporters of the charter as bigots, but a more charitable and nuanced explanation is that Quebec, and especially Francophone Quebec, has a different conception of secularism than the Rest of Canada. That doesn't mean the charter isn't racist. It is. But racism is often more complex than bigotry, and there's plenty of bigotry to go around in Canada, but only one secular charter.

The 2012 tuition protests are another example of Quebec's different political culture. It would be one thing if students in Ontario or Alberta had protested against tuition, but acquiesced due to lack of power or will. But that isn't what happened: analogous movements just don't exist outside of Quebec.

These issues make Quebec's political culture look more like France than the Rest of Canada.

Quebec fits the continental social market model better than Canada, and Scotland fits the Scandinavian social-democratic model better than the UK. It's not as easy to sum up the South; The former Confederacy is possibly unique in the world in its combination of traditionalism, its culture of honor and its particularly enduring legacy of slavery.

I have less to say about the United States because I have trouble writing about the politics of the South charitably, because I share everyone's outrage over the Zimmerman trial, bewilderment at David Duke's near-miss in his Louisiana gubernatorial campaign, and contempt for Republican lies, ignorance and nihilism.

Fortunately, so does much of the United States. Including, increasingly, North Carolina and Virginia.

The interesting thing is that these schisms have played out so differently in American and Canadian political institutions. In my lifetime, Quebec has gone from supporting a weakly federalist conservative party, to a separatist party (note that I don't say a left-wing separatist party, I wouldn't accuse Lucien Bouchard of being a left-winger), and now a weakly federalist social democratic party. In parts of anglophone Canada, that instability is chalked up to Quebec voters being crazy or ignorant. But that's ridiculous: Quebec just didn't fit easily into an Anglophone liberal democracy.

The American South is quite different. In my lifetime, the South has completed its transformation from the "solid south" of frankly white-supremacist conservative Democrats, to a stronghold for conservative Republicans, continually in fear of primary challenges. But in both cases, southern politicians have relied on parliamentary procedure to hold power despite only holding a minority of public support. In the past, that meant senior conservative Democrats would prevent legislation from leaving committee. Today it means Republican senators deploy any and all procedural tactics to slow down Senate business and prevent the functioning of the government insofar as it might hurt favored industries or redistribute income to "those people".

Quebec and the South both manage to hold some power despite their minority status, albeit through very different means.

So what does this all mean for Scotland? Scotland probably isn't big enough to swing Canadian elections like Quebec, and the United Kingdom's parliamentary system won't allow Scotland to game the system like the South. So I can understand the drive for independence. But the Euro crisis should make Scotland wary of separation nonetheless.

At one point, it looked like the EU could provide a technocratic umbrella for every ethnolinguistic group in Europe to be independent, from Flanders to Catalonia. To extend the metaphor, it's turned out that the EU's technocratic umbrella is a shitty umbrella that sucks. The European Central Bank has failed spectacularly in its duties to the Eurozone economy, but it faced a difficult challenge. The ECB has had to manage the diverse Eurozone economy without the benefit of fiscal transfers that the United States, Canada and the UK rely on. Even worse, Germany's dominance and inflation-phobia has meant that the ECB has had the impossible task of keeping weaker Eurozone countries afloat while holding German inflation to under 2%. The parallels to Scotland should be obvious. Scottish nationalists want to stay on the pound, but the rump United Kingdom will have little interest in fiscal transfers to an independent Scotland, nor would an independent Scotland top the Bank of England's list of concerns. And even if Scotland could join the Euro, why would they?

That's all to say that the Scottish referendum presents a bind between political culture and policy concerns. Scotland will have to navigate carefully towards what we in Canada have joked about Quebec: An independent Scotland as part of the United Kingdom.

Canada has prospered despite its unpredictable party system, and the United States is struggling along despite congressional intransigence. We'll see what happens in Scotland.