Will I look back at this blog and be embarrassed? Ashamed of my arrogance and naivety, shocked at how sure I was of myself? At least my shame may be a representation of the progress I have made as a human… but if I have made “progress”, and acknowledge it as such, I must be careful not to fall into the same pit of hubris by forgetting my own ignorance while I bask in supposed “progress”.

The truth is I already am embarrassed. Most of what I write here is unedited, slop-shod, and condescendingly irate with my audience. I write more than I should, and I justify it as practice, but it is an unskilled practice, without careful consideration or reflective analysis. I just write because I feel it. My subjects are inconsistent, my opinions under-formed and under-informed, my statements too bold and bullheaded. It is an angry kind of writing, something that lets the rage out. It’s just masturbation, and I so frequently am able to kid myself into thinking that it is practice for greatness; if anything it is a testament to why I won’t be great in the way I want to be.

The only times I’ve gotten feedback is when I have been more personal and soul bearing. Ironically, avoiding making myself into a public spectacle was the main reason that I chose to write about economics and politics. Maybe no one really knew wtf I was talking about with the economics stuff, or maybe Peter Hefti is the only subject I know enough to write about and make it sound genuine. There are billions of assholes with opinions on politics, millions of pseudo intellectuals with economics degrees who are writing blogs instead of research papers. That is my real failure as a scientist: I’ve reduced myself to a common pundit, and unlike Paul Krugman, I don’t have a Nobel Prize to justify my diversion. I don’t even have a master’s degree, for whatever that is worth. I value these things only so much as other people value them, because other people and what they think is what it is all about; otherwise, why would I write for you all to read?

I’ve begun writing a book. The hardest thing for me was to just start, but now that I’ve finally picked a topic, things have gotten easy. This means that I won’t be blogging as frequently. I am kind of bored with it. Now that I have reached my objective of “getting into the swing of things” with writing, and I have enough confidence in my abilities, I am not sure if there is any point of me doing this. I feel like I’ve kind of reached a dead end. I could continue to read the news and write angry technical tirades against everything, but it makes me feel like I am losing touch with my inner sense of self. It also just kind of makes me depressed. Responding to perceived injustices is tiring work.

Reddit

I’ve been redditing a lot lately, under the name Pendergrass because that’s who I was listening to when I made my account and I’m not very creative when it comes to making using names. Mostly on /economics.

I don’t know why… it is kind of a sad reflection of the state of affairs in my life that I’ve been spending hours a day engaging in economic and political arguments with people whose sense of surety comes from reading Paul Krugman or Naked Capitalism.

I do know why: it has been making me a better writer, more easily able to state my opinion clearly and concisely (regular readers <all two of you… hi Mom!> are probably in disagreement with this self-assessment).

Mainly I am just trying to be a good Samaritan by clearing up misconceptions and explaining technical stuff. Generally, most of the feedback I get is positive, which I guess is another reason I go there (to get feedback). At the end of the day, if I can light a candle for someone, I guess it makes it all worthwhile. If I seem so nonplussed about it, it’s because the level of discussion leaves something to be desired. It is better than most of the internet, but it is still the internet…

I was going into /politics at first but realized that it is pretty useless leaving meaningful comments there, since its all just an ideological pep rally. /economics is only slightly better than /politics in this regard.

One thing that both groups have made me notice is the divide between liberal people’s understanding of economics, and conservative people’s understanding of politics. I think a lot of liberals have very well-informed political ideas and realistic models of political organization, but they don’t have as much of a grasp on economics, particularly the “hard science economics” of mathematical equations. Conversely, I think the conservatives are blind to the realities of politics, but they seem (in general) to have a more solid understanding of rigorous economic models. I think a lot of this is just an accident of ideology, and it could speak more about my own ideology than about America or the world at large, but it is an interesting phenomena nonetheless.

Does anyone know of any good economics forums that are inhabited by grad students and Ph.D’s? I like most of Marginal Revolution’s commenters, but its not exactly a forum or community.

In Which I Abandon Many of My Previously Held Beliefs and Attempt to Steer My Liberal Brothers and Sisters Towards The Harsh But Comforting Glow of Reality (and the conservatives can come along for the ride too, but frankly I think most of them are weird, and if you are socially conservative, I wonder why you even read my blog unless you just like getting angry)

I’ve come to the conclusion that most self-styled liberals have confused or combined two distinct questions in economics: how do we best divide the pie? how do we best make the pie bigger? The answers to these questions are distinct. Any piece of policy can have effects on both, but to use a single policy to address both issues is to ignore the fundamental difference between the two questions. I think that the problem many liberal leaning economist have gotten themselves into lately is that they have let their desire for social justice overshadow their understanding of market fundamentals.

As a progressive and a social Marxist, I understand and sympathize with their passion. The equitable distribution of society’s resources is a noble cause, and one that shouldn’t be abandoned. Unfortunately for us, the current ruinous state of the economy cannot be fixed by redividing the pie. It also can’t be fixed by government directed intervention.

They may be able to prop up employment temporarily with additional spending, but any of the jobs the government can create in this way are not sustainable. All of the contractors repairing schools and bridges are out of work again when the job is done. The liberal thesis is that the economy will somehow self-correct in the interim, but this correction will not take place because the strategy of financing these stimulus projects with deficit spending and tax hikes exacerbates the root cause of the countries structural economic problems: we are broke. Our country’s balance sheet is sagging to the right, which is the side that all of the debt is on if you are not familiar with accounting.

I am going to do a 180° on what I have written before and say that the government can’t afford to do more spending. I’ve called for it in the past, because of the low interest rates and excess capacity of our economy, but my outlook has fundamentally changed based the economic happenings around the world and the political ineptitude right here at home. The specific ineptitude I am referring to is the Republican Party’s debt-ceiling hostage fiasco and Obama’s latest Job Program theatrics. I think the damage done by the debt ceiling debate is self-evident. As for Obama’s latest policy objective, it is a half-assed jobs program that is more than a day late and trillions of dollars short. It might have been an okay idea if we hadn’t bailed out the banks, and if he had gotten it passed when he first came into office instead of pursuing his disastrous health care overhaul, and if it were about 3 or 4 times as big. But now, the window of time where it would have been effective has closed, we can’t afford it, and in it’s current incarnation, it’s not designed to actually pass anyway. It is a political ploy for him to blame the Republicans for his failed economic policy. The truth is that neither party is doing anything of substance. Everything has been reduced to a zero-sum game because of political squabbling. S&P knows this, the markets know this, and you and I should know it as well.

My interest rate argument, which essential went “we should borrow money now at 2% and spend it on projects that have a return of greater than 2%”, I think it is a pipe dream in this political environment that the money would get to where it needs to be. Furthermore, doing more research about the economy outside of the United States has led me to believe that interest rates are artificially low. The relative weakness of other currencies and the lack of safe assets has created a scenario where interest rates in the US are being held low because treasury bills have come to be viewed as a financial safe haven due to the overall shittiness of the developed world’s macroeconomic conditions. Current rates are not a reflection of the fundamental strength of the US economy or the dollar, but of our relative perceived strength in comparison to the Eurozone and equity markets. In addition to foreign capital flowing into treasury bills, we also have the Federal Reserve injecting trillions of dollars into the treasury market to maintain these artificially low rates. The continued injection of trillions of dollars into the economy will create inflation as soon as demand picks up. The reason it hasn’t created inflation yet is because banks, and the few corporations that have some, are parking their cash on their balance sheets or giving it back to the government by buying treasuries. The government is using this cash to pay off the interest on the treasuries that are already outstanding and to prop up the economy with its weak and ineffective “stimulus” policies.

(Even my “brilliant” “a trillion dollars for fusion energy plan” would probably end up destroying more jobs than it creates, as the entire energy sector would probably shed more than half of its work force after widespread fusion energy became available. It is not what the economy needs right now; when we are back standing on our own two feet, instead of being propped up by the Fed and China, it would be an excellent idea, but for now we need a fundamental change in the government’s balance sheet.)

Capital needs to be in private hands where it can flow freely to the enterprises that can put it to the best use. This is the only way the economy can be restored. Hatred of bank bailouts is not a reason to keep capital out of private hands… if anything, it is a reason to keep capital out of the government’s hands, because the government is the one who bailed out the banks! If the banks that made bad mortgages were allowed to fail three years ago, it would have caused a larger recession, but it also would have given us a solid foundation to recover from. We currently have no such foundation, and we are now headed towards an even more monumental collapse because of our failure to address these issues in 2008.

I know I have called for additional infrastructure spending and a Manhattan Project for renewable energy on these pages, but I am now forced to temper these beliefs with my conviction that the government is not capable of efficiently allocating resources. The projects created by government spending have all been designed to boost consumption rather than investment, and they have done a poor job even at that. This past couple of weeks , I’ve been reading Keynes for the first time since college (actually I never read him in college, I just got the encapsulated version presented to me in textbooks). This reading has given me the insight that the biggest problem in the economy right now is a lack of investment. The easiest way for the government to incentivize investment is to lower taxes and reduce spending. We need lower taxes to generate private industry investment, and we need reduced spending to keep the deficit under control and send signals to the markets that we are finally getting serious about getting our economic house in order.

This means that social safety nets will get cut. It means that real wages will fall. But there is no way around it at this point. The facts on the ground stay the facts no matter how deep we have our head stuck in the sand, or how much we hate the other party. The United States is essentially insolvent and the only thing keeping us afloat right now is our collective lack of desire to acknowledge it. We can shellac more layers of debt onto the problem, but it’s only going to give us a sharper hangover when we finally have to wake up to the next morning in America.

I know that lower taxes, especially on the rich, is a hard pill for progressives to swallow. The entire narrative of evil bankers and corporations require that we punish them, that they be made to contribute towards the maintenance of our social capital, social capital that has been eroded by our elected officials because of corporate malfeasance. The problem with this narrative is that it is wrong. It is not the corporations that are evil, it is the elected officials who let them be bailed out, who stuffed the regulatory agencies full of corporate cronies, who choose to cut the social safety net instead of let their corporate sponsors go bankrupt. The “leaders” on both sides of the aisle are guilty of these same transgressions. It is not a case of the Democrats being for the working joe union member, and the Republicans being for responsible governance. They are both the parties of corporate America. That is why an independent, outside candidates like Ron Paul or Jon Huntsman or Ralph Nader or Dennis Kucinich don’t get a fair shake in the media. That is why the big banks and corporations donate to both parties instead of just the Republicans or just the Democrats. That is why senators and representatives from both parties voted for the bailouts. The only reason the Republicans have flipped over to being against the bailouts and against more band-aid style stimulus spending is because there energized base is standing up and demanding it (believe me, the Republicans would love to bring home the bacon, especially the ones who were there for the Bush administration).

The Democrats could learn a lot from the Tea Party bozos that they love to deride. They may be stupid and bigoted, but at least they are loud and make things happen.

The Democrats masquerade behind the moral, populist high road, but it is all a charade. The Democrats have used this story of evil bankers to distract us from dealing with the fundamental realities of our country’s political economy. Obama hasn’t delivered anything to us, except a disastrous health care plan that makes huge concessions to the drug companies and medical equipment manufacturers (guaranteeing them outsized profits and artificial monopolies), and a stimulus bill that has rescued politically favored corporations at the expense of the tax payer, all the while tacking on another trillion dollars of the fundamental problem (debt) and doing nothing to create sustainable jobs, jobs that will still be here when the stimulus money runs out (if you think he has, or if you are the type of person who likes to quote how many people have health insurance now, or you’ve ever linked anyone to this site, please read this post that I wrote especially for you).

The Republicans are no better than the Democrats. They do a good job of speaking as if they understand the fundamentals of market capitalism, and pretending that they are for smaller government, but then when they are elected they shift their policy agenda to social issues and give favors and breaks to their corporate benefactors. They spend just as irresponsibly as the Democrats, and they do it in ways that are to the benefit of a selected few rather than the majority of this country’s people. I’m not going in as hard on them because I am really wanting to focus this piece on my friends and readers who are liberal democrats, because I feel like I have a greater chance of saving you than I do of turning a Tea Partier into a born again liberal. So yes, Republicans are very bad.

The bad news is that things are going to have to get a lot worse before they can get better. The good news is that things can get better, we just have to stop lying to ourselves, and stop believing the lies being told to us by the charlatans that we keep putting into office.

Of all the deficits we have, I think the biggest one is a deficit of leadership. The problems in both our economy and our government are structural, and they are related to each other. It is an addiction to spending and abuse of the power of appropriation that has given us these structural defects; the toxic mortgages were just the termites. Neither party wants to address the real issues because they know they are part of the problem; the biggest part.

They are going to trick you into voting for one of them next year by making the other party into a boogieman, and it is going to scare you, and you are going to vote for a candidate who you think will do a less worse job than the other one… and your candidate may win, and you will look at his or her future policy accomplishments and say: “that’s not too bad… imagine what would have happened if the other guy got into office!” and you will feel good about yourself and your vote, or about as good as you can feel about such a thing, but deep down inside you will know that something is wrong, that the system is rotten. You will justify your candidates inefficacy by blaming democracy (“its the worst system, besides all the other ones! hahaha Churchill”), the two-party system (“well I can’t let that other bozo get into office”), the corporate interests (“it’s the greedy corporations that mess everything up”), the lobbyists (“it’s not really the corporations that are bad, but all the money they put into politics”), the banks (“they screwed us over by giving me a mortgage I can’t afford… why did they let me do that?”). It will be anybody but your candidate’s fault. Mainly it will be your fault, because you’ve read this piece, and now you know that the two major parties aren’t going to do jack shit for you (or maybe you don’t believe me… if so, leave me a comment or send me an email heftionezip(at)yahoo.com and tell me why not).

Vote for anyone but an establishment candidate.

If you want to vote for a liberal politician, vote for Ralph Nader.

If you are sick of politicians, vote for yourself, or your mom, or your best friend.

I’m going to be voting for Dr. Ron Paul. I don’t agree with the man on everything he has to say, but I believe his conviction in what he says, and I can’t say the same thing about Obama… I’m sure you remember from the last election cycle all the empty sloganeering and smooth rhetoric that whetted the media’s collective pussy and probably yours too. How many of those promises has Obama delivered on? How many has he even tried to deliver on? I’ll give him health care (for now… I’ll crack that coconut on another day), but Guantanamo? The Wars? Gay Marriage? The Economy? Wall Street/Banker Bonuses? Ron Paul has a 30+ year record of sticking to his principles that you can see in his voting record in congress. Get the man elected, and you know he is going to do what he says he will. And if you are still scared that he is going to criminalize abortion, or that disbanding the DoED will somehow hurt America, or that he is going to let corporations run amok and pollute all over the place… if those are the only things holding you back, keep coming back here and listening to what Dr. Paul has to say, because I think that 14 months might be enough time to assuage those fears and change your mind.

A Digression Into The Media

If you believe that Obama has done something for you (rather than to you), you need to stop reading the Huffington Post, put your abstract thinking cap on for a second, and bear with me as I explain to you how you most likely got these ideas in your head.

Jokes aside, because I know everyone doesn’t read HuffPo and it is an easy target, everyone gets their news information from media source. The media influences your beliefs about the president has or has not done for you, and the media, just like the government, puts on a show that there are two sides to the story: the Liberal MSNBC/Huff Po/NY Times version and Fox News/Drudge Report/Wash. Post version. The reality is that what finds its way into your brain is a carefully curated selection of news bites, micronarratives, and memes specially designed for your consumption pleasure by the corporate interests that own the media. Media consumers self select towards which ever agenda they want to believe; this is why two “opposing” viewpoints are presented. By defining the news item agenda, and then defining the viewpoints of the two opposing sides, the corporate media is able to completely define the conversation. They marginalize stories or discussion that doesn’t serve the corporate-supported narrative’s continuity, and they are able to literally manufacture public opinion through the careful curation and circumscription of public information.

This doesn’t require a conspiracy to happen; the mechanisms that allow for it are as subtle as picking the right editor-in-chief of a newspaper, who has the power to kill a story or make sure it gets picked up by Reuters or the AP, and subsequentially into thousands of papers across the country. You don’t need to kill every story, just make sure that the skew is right, or that it’s buried on B6, or that it’s short and incomplete. Once consensus coalesces around the corporate interest’s supported narrative, it doesn’t even matter if the independent media picks up a “subversive” story, because it has already been marginalized and not enough people will believe it anyway for it to make a difference one way or another. The more that a story challenges the corp.-supp. Narrative (a.k.a. the consensus), the more outlandish it seems, the bigger a potential lie it becomes… and the less likely we are to take it seriously.

I know we would all like to think we have bulletproof brains that are impervious to such obvious chicanery, but these memes and ideas enter your brain as soon as you are exposed to them, whether you like it or not. Your own ideology acts on the information, giving you a firm impression of “what a load of shit that the GOP/Obama would do that”. This is true especially if you already say you support the Democrats or support the Republicans. Your ideology is there, even if you only vote to keep the other bastards out of office, and that ideology is what allows these memes to flourish, like bacteria in our brains.

The only way to rise above it is to trust no one, be 100% skeptical of the media and consider who is it that is most likely to benefit from the dissemination of such information, why they may want to disseminate it, and what the counter facts may be… and then as soon as you think you have something resembling a concrete opinion about the truth or meaning of a certain piece of media propagated information, reject it. There is no truth in the corporate media, only interpretations of events. You must adapt your mind not to think in binary dimensions of true/false, but rather in quantum field dimensions where all there are is probabilities and uncertainty, and you should exercise your mind by absorbing as many disparate interpretations as possible.

***Most of the ideas contained in this post are from Edward Herman and Noam Chomsky’s Manufacturing Consent, which I recommend to everyone. It could quite possibly be the most important book you ever read on the media, and if you work in the media or critique the media, you are doing yourself a great disservice by having not read it.***

Parents

Does anyone else think that becoming a parent is the worst possible thing you can do to your sense of objectivity? It seems like everyone I know who is a parent directs all of their energy towards selfishly supporting the welfare of their children. I am not saying this is a bad thing for society, because children need someone to look after their welfare, and who better than their parents, but all of my friends who have kids become completing uninterested in most subjects besides their kids. A lot of them abandon their progressive politics and become pragmatic Wal Mart shoppers. They start voting Republican because they are afraid of their kids dying in a terrorist attack, or they start voting Democrat because they want the government to do as much of their parenting for them as possible.

I’m not trying to sound normative about any of this, I just want to point it out as an interesting observation. I don’t resent any of the parents I know, but being aware of the transformation that can take place makes me very weary of having kids.

My ideas are my babies.

What is Philosophy?

Inspired by this post that I discovered on my favorite website, The Browser.

I am arrogant enough to think I can answer this question in a way that is unique.

The science of philosophy is a methodological study of how we use information to form arguments or opinions.

You can break philosophy down into metaphysics, ethics, epistemology, aesthetics, etc. but at the end of the day, you are still going to be exploring and critiquing the methodologies used to explore those problems, and if you are not, you are not really “doing” philosophy as a science. Ultimately, all these separate branches of philosophy just form schools of thought that have developed through the use of the philosophical method of inquiry.

I’m willing to admit my definition seems biased toward epistemology as a sort of higher form of philosophy, and probably much of that has to do with my own fierce belief in empiricism. I ultimately believe that you can’t approach ethical or metaphysical questions in a non- empirical way and draw any meaningful conclusions. In many ways, metaphysics and empirical knowledge are just two sides of the same coin, with empirical science constantly chipping away at what we consider to be metaphysical (of course, empiricism never seems to make any significant progress in relation to the size of the metaphysical problem set). Metaphysics occasionally fights back and reclaims large swathes of empirical knowledge, as we find out we didn’t know quite so much as we thought we did. I see empiricism as the act of refining and defining, while skepticism is the act of negating and boundary blurring. You can’t be a true empiricist without a large amount of skepticism, and it is no accident that skepticism often pushes problems into the realm of the metaphysical.

Granted, this could be entirely personal, but I don’t consider most religious doctrine to be philosophical (Buddhism being the notable exception, but I don’t consider Buddhism a religion per se, and I will admit to not knowing as much as I should about Hinduism or Islam. My understanding of Islam is that it suffers from the same conceit as the other Abrahamic religions: there is only one God, this book is his word, and if you can’t believe that, you might as well go home).

Democrats: vote for Ron Paul in the GOP Primary

If you know me personally, you will know I have had kind of a love/hate relationship with Ron Paul over the past several years. Part of the reason is my own shifting attitudes. Another part is some of the things I’ve heard him say this campaign cycle that sound like pandering to the Tea Party.

He’s really impressed me in the last two debates. I am glad he is getting the national television exposure, and I am even more excited that some of my liberal friends are starting to change their own attitudes about him.

There are still a couple of stumbling blocks a lot of liberals have with him. I think a lot of the “omg he can’t really want to do that?” vibe that people have is because they haven’t really gotten familiar with libertarianism outside of the caricatures of the Tea Party and Ayn Rand crowd. As someone who was raised in a libertarian household, and who has held libertarian beliefs long before I gave up reading Atlas Shrugged because of its cliched prose and one dimensional characters, I am hoping that I might be able to dispel some of the fears that sensible people might have about Dr. Paul.

Abortion: the government shouldn’t legislate abortion. Ron Paul thinks it should be up to every state, not the Federal government, to say whether it is illegal or not. This is inherently more democratic than categorically making it legal or illegal at the Federal level. So people who want abortions can get them in California. People who live in Kansas… another reason to gtfo of Kansas.

Civil Rights Amendment/Affirmative Action: Ron Paul’s objection to it isn’t based on racism, its based on his belief that the government should not have the power to step in and tell private business owners what they can or can’t do. I am sure he abhors racism, as any sensible person does. Legislating against racism doesn’t make it disappear. I belong to pretty much the most privileged demographic imaginable: heterosexual white American male. I think there is a tendency for people who are not directly effected by racism to want to “do something” to make it better, to clear their conscious of a perceived advantage that they have done nothing to invite upon themselves. The problem is that legislating corrective privileges for minorities makes us feel like we are doing something, that racism has been “solved” or “fixed”, and we go on with our lives. Racism hasn’t been fixed, and our failure to address it on a personal and cultural level is probably one of the greatest domestic issues facing our country (and the whole world). When the debate shifts towards “is Affirmative Action fair?” and away from “how do we treat people and why are these minority groups struggling socially and economically?”, we are doing a great disservice to society.

Department of Education: it sounds really bad to want to “eliminate the Department of Education”, but do you even know what the DoED does? Not a heck of a lot. t doesn’t establish schools. Most school funding comes from state and local governments. Curriculum standards are in the jurisdiction of the states. The DoED does “coordinate and administer” certain funds that go to schools; it has a 70 billion dollar budget, most of which goes towards administering and enforcing the No Child Left Behind act, which hasn’t done anything but frustrate teachers and students, and it pays government salaries for 5,000 federal employees. If the department were eliminated, the savings would pass along to tax payers or could go straight to the states.

Environmental Protection Agency/ Food and Drug Administration: the libertarian argument is that these agencies are unneeded and ineffective. The main problem is regulatory capture. The people who end up running these agencies are former chemical and drug company CEOs. They get watered down regulations passed, so it looks like they are doing something productive, when in actuality they justify the terrible practices of polluters and misleading food labels by giving them the government seal of approval. Certainly, libertarians argue for more person responsibility, but the real mechanism for fighting evil corporations is the tort system. Companies that mess up should be sued. The current problem is that when they are sued, they are not held liable because they were following the regulations. Ron Paul doesn’t want corporations to run amok in America, putting poison into the land and our food supply: he wants them to be held accountable, and he doesn’t want the Federal government to be a covert conspirator in their malfeasance.

Keep in mind that (despite what you may think at this point), I am not a Ron Paul maniac. I may be speaking more from the standard libertarian position than from what Ron Paul himself has said… so if you have an article or video contradicting anything I have to say, I would welcome adding it to the discussion. The real point I want to make, to liberals especially, is that he is not a maniac or hack like the other people running for president. If some of his ideas “sound crazy” at first, it’s just because the society and paradigms we have grown accustomed to are crazy, and his ideas stand in bold opposition to them.

If you are a democrat, you should register as a republican and vote for Ron Paul in the GOP primary. At the very least, he will divide and disrupt the party you hate, and if he wins, he will force Obama to debate the issues that really matter: the wars, the economy (Mitt Romney and Obama are 95% the same on economic issues… the media will play up that 5% difference, but don’t let them fool you into thinking it’s a real choice between two distinct solutions), and personal liberty (which he is all for despite his personal views against abortion and for Jesus… he is the only candidate who believes in personal freedom over his own personal ideology, or maybe a better way of saying it is that freedom is his primary ideology, Christianity is his secondary ideology. None of the establishment GOP candidates can say that, and Obama won’t even let you know where he really stands).

“But listening to lies does not make us safer, even though it might make us feel better about ourselves. The truth is that ending these misguided wars and occupations will make us safer, more prosperous and more free.”

Ron Paul:

Ten years ago, shocking and horrific acts of terrorism were carried out on U.S. soil, taking nearly 3,000 innocent American lives. Without a doubt this action demanded retaliation and retribution. However, much has been done in the name of protecting the American people from terrorists that has reduced our prosperity and liberty and even made us less safe.

This is ironic and sad considering that the oft-repeated line concerning the reasoning behind the attacks is that they hate us for who we are – a free prosperous people – that we must not under any circumstances allow the terrorists to win. Though it is hard for many to believe, honest studies show that the real motivation behind the 9/11 attacks, and the vast majority of other instances of suicide terrorism, is not that our enemies are bothered by our way of life, neither is it our religion or our wealth – rather it is primarily occupation. If you were to imagine for a moment how you would feel if another country forcibly occupied the United States, had military bases and armed soldiers present in our hometown, you might begin to understand why foreign occupation upsets people so much.

Robert Pape has extensively researched this issue and goes in-depth in his book “Cutting the Fuse: The Explosion of Global Suicide Terrorism and How to Stop It”. In fact, of the 2,200 incidents of suicide attacks he has studied worldwide since 1980, 95% were in response to foreign occupation. Pape notes that before our invasion of Iraq, only about 10% of suicide terrorism was aimed at Americans or American interests. Since then however, not only is suicide terrorism greatly on the rise, but 91% of it is now directed at us.

Yes, the attacks of 9/11 deserved a response, but the manner in which we responded has allowed radicals in the Muslim world to advance a very threatening narrative about us and our motivation in occupying their lands. Osama Bin Laden referred to us as “crusaders” with a religious agenda to convert Muslims, westernize their culture and take control of their resources. If we had targeted our response to only the thugs and criminals who attacked us, and refrained from invading countries that had nothing to do with it, this characterization would seem less plausible to the desperate and displaced. Blaming Islam alone is grossly misleading.

Instead, we chose a course of action that led to the further loss of 8,000 American lives, 40,000 wounded, and has left hundreds of thousands seeking help from the Veterans Administration. We are $3 to $4 trillion poorer. Our military is spread dangerously thin around the globe at the expense of protection here at home. Not only that, but we have allowed our freedoms to be greatly threatened and undermined from within. The PATRIOT Act, warrantless searches and wiretapping, abuse of habeas corpus, useless and humiliating circumstances at the airport, are just a few examples of how we have allowed the terrorists to win by making our country less free. Suicide terrorism did not exist in Iraq before we got there. Now it does. There are no known instances of Iranians committing suicide terrorism. If we invade and occupy Iran, expect that to change, too.

Sometimes it can be very uncomfortable to ask the right questions and face the truth. When a slick politician comes along and gives a much more soothing, self-congratulating version of events, it is very tempting to simply believe what we would like to hear. But listening to lies does not make us safer, even though it might make us feel better about ourselves. The truth is that ending these misguided wars and occupations will make us safer, more prosperous and more free.

College Degree Wage Premiums: Signaling vs. Human Capital Accumulation

The general consensus in the sub-field of education economics is that college graduates command a wage premium because of two separate effects: human capital accumulation (a.k.a. learning) and signaling (a.k.a. getting a piece of paper for being a good little monkey and jumping through the hoops). Every study I have read on the subject comes to a different conclusion about how much of the premium comes from human capital, and how much comes from signaling. The general consensus, from what I remember from the survey course I took in 2008, is that the majority of the effects come from signaling.

This recent study done at Georgetown, that specifically looks at wages and how they are effected by college degrees and other factors such as demographic identity and occupational choice, doesn’t really tell us anything that is new. It does have some surprising figures about proportions of relatively uneducated people who hold “highly respectable” occupations such as executives and legislators, but all in all it isn’t paradigm shifting or even a surprise to anyone who is already familiar with the subject.

This article makes the claim that signaling makes up most of the wage premium. The article is a commentary on the aforementioned study, and more anecdotal than empirical in its analysis, but it does make interesting implications about the supposed bubble in higher education.

It is hard to measure a bubble in higher ed. Most of the models

On Greece and the Market Psychology of Bailouts

“You know the first time someone plays poker they are afraid to bluff. The second time they decide bluffing is great. By the third time they are so confused about who is bluffing and when that they might as well just hand their chips to the best player at the table and save everyone the time and effort or taking the chips.  I think the central bankers and governments have gotten so confused they are bluffing with a few low off suit cards and don’t even realize the cards are face up.”

More here at Zero Hedge.