A Few Philosophical Thoughts On "Taxation Is Coercion"

Pieter Brueghel the Younger, "Paying the Tax (The Tax Collector)," via Wikimedia Commons

I feel like there's been an uptick in people in the US using "taxation is coercion" or "taxation is theft" to support their given point of view. The topic is obviously enormous and too large to be dealt with in a short blog post, but these are just some thoughts that come to my mind about this idea from the philosophical perspective.

Taxation is only coercive against a backdrop of a very specific theory of ownership -- one in which you have full property rights to whatever you gained in a voluntary transaction. But as we've discussed before, this theory of ownership faces several serious and well-known problems.

First, contemporary economic activity is now enmeshed in complex webs of social, cultural, and political structures and relationships. Many modern voluntary exchanges would be impossible without infrastructure, education, etc. etc. etc. As is often pointed out, the question isn't whether we have to pay for these things -- it's just how much.

Second, if we actually tried to follow a principle in which everyone has full property rights to whatever they gained in a voluntary transaction, we'd run immediately into the difficulty that vast wealth and holdings in western countries derives partly from utterly non-voluntary transactions.

This is because in a theory where you have full property rights to whatever you gained in a voluntary transaction, you do not have rights to whatever you gained through a non-voluntary transaction, and you do not have rights to what was stolen or taken by force. If A steals a diamond ring from B, then A doesn't own the ring -- B does. If A sells the ring to C, C also does not own the ring: justly speaking, B owns the ring, C owns the money they were going to trade for the ring, and A doesn't own anything.

But the land and wealth in rich western countries is enmeshed with a violent history of colonialism, slavery, war, and theft. Under the theory of ownership being proposed, who would own the land in North America? Presumably, Native Americans and Indigenous people and no one else. So the theory leads to very different consequences from the ones it's typically taken to support.

Third, when the full ownership theory is used in ways people don't like, there's a lot of uproar about it, suggesting most people do not endorse or agree with that theory. When Martin Shkreli bought the rights to life-saving drugs and then radically raised the prices, what he did was well within his rights in the full-ownership theory of property. It's his -- he gets to do what he wants.

I've been surprised by the degree of hate against this guy from all sides. I mean, I think the outcomes are bad, but then I'd endorse a different health care system entirely. It's the lack of supporters from other sides I'm struck by.

As I mentioned before, on Reddit there was general applause when a doctor pressed Shkreli on what improvements in the drug "warranted" the price increase. But that's not how our system works. I actually thought Shkreli made a valid point when he said in 2015, “Our shareholders expect us to make as much money as possible ... That’s the ugly, dirty truth.” That's true. The problem is with the system, not with one specific guy.

Anyway, moving beyond the full ownership theory, it seems to me that whatever theory of ownership you adopt, a claim about "coercion" is a moral claim, and once you're in the realm of morality, things are never straightforward. As I discuss in my 2015 book, many people endorse multiple values. In our society, that range of values often includes some right to be free of certain kinds of interference. But it also often includes other values like justice, benevolence, honesty, fidelity, and so on.

So whether taxation is "coercive" isn't the end of a discussion. It's the beginning of a larger discussion, about ownership and what is and isn't coercive, but also about how all the various values we endorse should be implemented and prioritized in some sensible way. Obviously, this is something the citizens can, and do, disagree about, and that's one reason politics is complicated and fraught. 

I don't endorse the kind of full ownership theory that would be necessary to conclude that taxation is coercive, partly because, as this book review explains, taxes are "part of the entire system of property relations, not something that happens after property accrues in private hands." That is, there's no "A owns X and B owns Y" and then you have taxes. Rather, taxes are part of the system of property relations that entails what, exactly, A and B own.

And if property relations are a system of which taxes are one part, then I also believe that other values, like justice and fairness, should play a rule in structuring that system. 

Is Giving Away More Money Easy Or Hard?

Sometimes in discussions about poverty, taxation, charity and inequality, I encounter a very specific debate over whether choosing to give money away is more difficult in some way than paying a required tax. If yes, the suggestion goes, that'd be an argument for a system involving taxes to move money around. If not, things are less clear. 

Some people seem to suggest that it's no more difficult to give your money away than to have it taxed. I remember that this thought comes up in Cohen's book If You're an Egalitarian Why Are You So Rich?  It's not really harder to give money away voluntarily, the thinking goes. If you're the kind of person who has trouble being motivated or who tends to get distracted and spend your money on other things, you can just automate the process. You know, monthly auto-pay or something. By pre-committing to donation, you can lock yourself in.

Let me say first that while I appreciate the debate over voluntary action and alternatives, it seems to me first that this is the wrong framework to apply to questions of poverty, charity, and taxation. As I've said before, the real problem is the theory of ownership that implies -- falsely IMO -- that what we end up with after some exchange is uncomplicatedly "ours" -- as if our interaction were happening outside of history and outside of a social structure with vast historical and contemporary injustices already built in. From my point of view, moving money around isn't a matter of charity but rather a matter of justice. So it's a different kind of thing altogether.

The other reason this framework seems to me wrong for this problem is that there are vastly different effects from individual voluntary giving than from general taxation. If everyone at my income level is taxed in the same way, all those people have less money, and this will affect prices and which goods are available and whether or not I can afford various things. With individual giving, you're just individually making yourself financially worse off than other people with none of the ameliorating effects.

But let's leave all those problems aside for the moment and just consider this question about difficulty. Is it difficult to give away more? For me, I would say that the answer is yes. The pleasures that money can buy speak to me just as they speak to anyone else, and it's not news that in our version of capitalism the forces encouraging you to buy things are relentless. When I have discretionary income, I want to spend it. More treats for me! More gifts for my people!

It's interesting to me that the question of automation comes up in this domain. I see the point: if you automate the process of giving, then the giving happens automatically and there's a sense in which you don't have to "make a decision" about it over and over. It just happens. You're locked in.

But you know what? For me, there's locked-in, and then there's locked-in. Voluntary automated systems that take money away from me are just not the same as involuntary systems like taxation. They're not the same because I can simply change my mind any time. And knowing I can change my mind any time, continuing to give requires the same mental energy and the same motivation and the same -- let's be honest, struggle -- that non-automated giving entails.

I don't know what it's like for everyone else, but I'd say there are some reasons to think my feelings are not uncommon. We're constantly reading that people are not saving enough for retirement, or saving enough for emergencies, or allowing their credit card debt to pile up. If automating a payment system solved the problems of motivation and commitment, then dealing with these problems would be a no-brainer for most people. But obviously that is not the case.

So, while I don't buy the framework of comparing voluntary giving to taxation in addressing poverty and inequality, I will say this: within that framework, my answer to the question of whether giving away more money is easy or hard is clear: it's hard, not easy.

Why Is Cash Disappearing, Just When We Need It Most?

Did you know: Cash Cats is a thing?

I know things are crashing down all around us, but do you have a few minutes to listen to me talk about cash? Specifically, why is cash disappearing now, just when we need it most?

Cash offers so many huge and unappreciated benefits. For one thing, it is mostly untracked. In the surveillance state and the surveillance economy, everything you do is being watched. The government is watching. Corporations are watching. Retailers are watching. Don't you find it a little creepy being followed around the internet by targeted advertising?

I recently recommitted to using cash on a regular basis, and I found that some retailers go out of their way to make this payment method painful. I wanted to buy a simple Wüstof at Williams-Sonoma, and when I said I'd pay with cash and refrained from giving my email address, the salesclerk said, in a threatening tone, "Really? I have to warn you, you're going to get a huge receipt, it's a big pain. Is that going to be OK for you?" Luckily I carry a backpack, so the "huge receipt" was not a problem.

I know cash is now going to be trackable and whatever, but still. For now, if you're a regular person using it to buy stuff, you're basically flying under the radar.

Another benefit of cash is that it is harder to spend than other, more up-to-date forms of money. It is a bit obscure to me why this should be true, since cash is a symbol of something and not, itself, the thing. And yet cash is harder to spend. In one study, MBA students were willing to pay twice as much for something if they paid by credit card than if they had to pay with cash.

This certainly resonates with my experience. If I'm thinking about buying some sort-of-optional thing, like a piece of clothing or a new backpack or whatever, I find my feelings shift noticeably if I think about paying in cash than paying by card. There's something about handing over a wad of twenties that just hurts in a way that paying by card doesn't. In fact, I'd say that paying by card can feel downright pleasant -- and this aesthetic aspect is surely something people are thinking about when they design systems like ApplePay.

I recommitted to using cash for several reasons. I fear that if people don't use cash, cash will disappear, and I don't want that to happen. I want to incentivize the ongoing existence of cash. I use it to keep track of how much I am spending over time. I occasionally take taxi cabs in cities where drivers really really prefer cash.

But my cash quest is a lonely one. People seem to prefer cards so deeply and by such a wide margin that using cash is almost unthinkable. On campus, students use cards even to buy a cup of coffee -- they even use bank cards, where you have to wait and type in a PIN, and wait again! Aren't young people supposed to  be the impatient ones?

Even though this article in the New York Times showcases research showing that because is harder to pay cash for things you end up liking them more, the researcher seems to treat the idea of cash as almost unthinkable: "I’m not saying we should revert back to cash," she says, adding that maybe there could be a buzzing noise or email associated with a transaction that would bring back the pain of paying by cash.

As with fake noises for electric cars, this makes me think how odd it is that our new frictionless systems have to build the friction back in somehow.

I live in Canada, where the cash system is working pretty well. Theres' a sensible distribution of coins and paper, no pennies, and fresh bills. I'm from the US, and whenever I come back to the US for a visit, I'm appalled by the cash situation, and especially by the ongoing inclusion of pennies in a cash transaction -- which is the main thing making carrying cash, paying with exact change, and receiving change all a huge pain in the ass.

This has gotten to the point where I have started considering the possibility that the powers-that-be are intentionally letting the US cash situation get annoying. How else to march everyone off to the promised land, where we all pay by app, there's no shady markets, there's no coins to give to people on the street, and there's 100 percent tracking and 100 percent surveillance?

Anyway, it's interesting to me to think about why modern consumers find the idea of cash so unthinkable. Is it just that carrying around some paper and metal is now an unbearable convenience? Is it self-surveillance, life-hacking style? Is it that the "pain" of paying cash is too painful, given all the other painful things going on? Is it something to do with wanting "payment" to feel like the fun of a video game?

Is it all of these things?

If We're So Rich, Why Do We Feel So Poor?

For the last class in my course on ethical theory this term, we discussed some passages from a book called Ethics for a Broken World. This book has a brilliant concept: it takes place in a future world that has been broken by catastrophic climate change, and presents imaginary lectures that discuss, as we do other historical periods, the philosophical writings of our era.

In the book, our world -- the world of 21st century western liberal democracies -- is called "the affluent world." Clearly, relative to the broken world, we are utterly affluent. In the broken future, there aren't enough resources for everyone to live. There are "survival bottlenecks," which necessitate "survival lotteries."

Looking back from the future, the affluence of our world seems astonishing. We have enough resources for everyone to survive, and we frequently spend enormously on gratuitous entertainments like flying around just to see new places.

Of course, you don't have to look back from a broken future to realize the affluence of 21st century western liberal democracies. We are richer than we were in the past -- maybe richer than ever before. We are richer than some countries, and way, way richer than others.

According to this, if you make more than $34,000 USD, you're in the top one percent of the world's richest people. If that's even sort of right, then in some sense, relatively speaking, we are living in an affluent society.

So why, if we are so relatively affluent, do we feel so economically crunched? Why does it seem like everyone is freaking out about not having enough money? Why is everyone so indignant about the bits of money that go into sensible projects like fighting climate change, improving elementary education, and helping refugees?

The obvious answers have to do with cost of living, changes from the status quo, and inequality. Yes, things cost a lot in modern liberal democracies, so what seems like "a lot of money" may not translate into a lot of buying power. Plus, what feels like "a lot of money" is often relative to some previous point in time, and since the economic crisis, we feel we're doing less well than a few years before. And rising inequality means "we" experience non-affluence in very different ways.

But I think there are also some subtler effects.

First, when it comes to living human life, it's not the case that "everything is relative": there are things and activities that everyone needs to survive and there and also things and activities that everyone needs just to feel part of their social and cultural world.

In our society, you need food and shelter, but you also need other things: to feel part of our social and cultural world, you have to be able to get around, you have to have access to the internet and other forms of news information, you have to have access to banking, and so on and so forth.

And here's the thing: in our society, when it comes to these things we need, it's not like there are a range of ways to do it and if you're poor you do it one way and if you're rich you do it another. It's more like -- there are pretty expensive ways to do it or you're just SOL.

For example. You want a TV? There used to be old technology that made TVs pretty expensive. Then new technology came along, and the old technology got pretty cheap. For a while there you could buy a TV with the old technology for almost nothing. Then they stopped selling those. Now it's back to a TV is a pretty expensive thing.

Same with cars, which are astronomically expensive and which you need to get around if you're not lucky enough -- and rich enough! -- to live in a densely populated area with public transit. Same with housing. Houses are bigger and nicer, so you can get a nice one if you have the money or ... not.

This is where rising inequality makes such a difference. If enough people over a certain level means consumer demand shifts, and the only version of things you can do is the expensive one. If you can't afford the expensive one, you're in trouble. This is one way we are so deeply economically interdependent, even when we don't want to be.

I think this phenomenon is part of why the post-economic crisis time feels like such a huge problem rather than a dip in an already affluent set up. When times are even a bit flush, we ramp up -- we create systems in which the things we need to do work in a certain kind of way and demand a certain level of resources.

Then when things shift down -- even a bit -- we can no longer use those systems. It is, legitimately, a crisis, even if in some sense there is still a lot of money around.

Of course, another reason that virtually everyone, at all points up the economic ladder, feels like OMG we don't have enough money has to do with this obvious but usually unspoken fact: in advanced capitalism, the whole point of the system is to make you feel like you don't have enough money.

Especially in an affluent world, where you have to convince people to buy, what is advertising, except a massive scheme to convince people that they're inadequate as they are and that they would be less inadequate if they had this or that thing? 

You put it all together, it's really no wonder we're all feeling so poor. In a way we have so much, and in another way, we don't have what we need. Those things seem contradictory but in a deep sense I think they're not.

Philosophy 101, Fall 2064! Brought to you by RitBull™! The "Smarter" Energy Drink!

Welcome! And thank you for signing up for Fall 2064, Phil 101, a.k.a. "Philosophers: They're Just Like Us!"

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Topic 1: Theism and the Problem of Evil

In this topic we're talking about the question that just won't go away: if God is so great, why does bad shit happen? Special focus on: does bad shit really happen, or does it just seem like bad shit is happening?

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Topic 2: Justice and Inequality

In this topic we get very current-eventsy, asking deep questions about whether it's "fair" that some people just inherit huge sums while others have to beg for food. Our discussion will center on the question, "Wait, 'fairness?' Is that really even a thing?"

NOTE: We're thrilled to be sponsored by the Liberty-FTW! Institute for presentation of this great topic! Thanks, liberty guys!


Topic 3: Philosophy of Science

Is science for realz? You may not know it, but for hundreds of years philosophers have been, like, OMG we're not sure! Special consideration of the question: Science after Hume: is it all just a matter of faith?

NOTE: A big shout out to our fantastic sponsor, the Center for a Happy, Healthy Climate. Check out their new video: Carbon Dioxide Is Your BFF!

How Modern Capitalism Perverts The Moral Law, Or, "Can Implies Ought?"

Dividend Day at the Bank of England, By George Elgar Hicks, via Wikimedia Commons

It seems like every morning you wake up and read about some new sinister, awful, or just plain stupid thing happening in the worlds of employment, business, and finance.

Why so awful, Modern Capitalism?

Seems to me that in addition to the usual suspects, there's a quieter one lurking around, which is that the structure of modern capitalism is such that any possible awful thing, if it's likely to make a profit, has to become an actual awful thing.

That is, because of the nature of capitalist competition, obligations to "shareholders," and so on, anything you can do to maximize profit becomes something you "ought to do." That is, if you can do it, you ought to do it. Can implies ought.

This turns on its head the familiar Kantian dictum "ought implies can." This principle (confusingly expressed IMHO, but whatever) just means that you can't be morally obligated to something that is impossible to do. Like, a doctor can't be blamed for not saving someone's life if there's no known medical treatment for the illness.

We could argue 'til the cows come home about whether "ought implies can" is a foundational principle of ethical behavior or a spandrel of Protestantism but it doesn't matter here, because no matter what you think about "ought implies can," its opposite, "can implies ought," is nuts.

Example 1: Worker Surveillance. You can read here about "Businesses Going Into All Surveillance All the Time Mode" -- but really the title says it all. With the new technology, you can watch and record and analyze every single thing your employees are doing, how they're doing it, and even what emotions are revealed by tone of voice. The company described in the post offers ways to monitor "stress in your voice," and "changes in your relationships with your peers," and how long it takes you to commute to and from work.

At first you might think, as I so often do these days, "weren't these people made to read any dystopian fiction in high school?"

But you can see how these things get off the ground. In a world in which intense competition is considered a hallmark of a well-functioning market, you really can't afford not to exploit any available technique for increasing productivity, even if it's a small increase at the cost of treating people like human beings.

If you don't maximize profit for shareholders, they will get rid of you. If your competitors do it, and you don't, then you're out of business. So you have to do it. Can implies ought.

Example 2: Suicidal Financial Risk Taking. Remember back in 2008 when the financial system imploded? In the years since, it's been frequently said that banks and others systematically underestimated risks and tried to mislead the purchasers of both new economic products and old ones like mortgages.

Shenanigans? Sure. But so what? If other banks are making massive returns on investments by pursuing short-term instead of long-term interests, everyone has to, or they'll disappear.

Example 3: Environmental Damage. Suppose your company has a production mechanism that pollutes the environment. Suppose your company discovers a new way of producing energy that has potential for great environmental harm, like fracking. What should you do?

We already know the answer. It doesn't matter how much any particular person at the company cares about the environment, because in the logic of modern capitalism, the obligation to use the new techniques is embedded at every level.

Through these examples we see that "can implies ought" can create obligations to do awful things in several categories. You have to be awful to other individuals you employ, dangerous to the global financial system you're part of, and you have to help break the planet.

So now, when you do something awful, you don't even have to say you were just following orders. You can say you you were just following the logic of modern capitalism. Can implies ought! What could I do?!

How Is It A Free Country, If All Your Options Suck?

The infamous "McDonald's memo."

I was drawing up the syllabus for my fall course on introduction to ethics and values, and I found myself wanting to confront a weird situation my students find themselves in: while in one sense we live in one of the freest places in the world, their path through life feels, to them, extremely constrained.

In some senses, North America in 2013 is a free place. You can, to a large extent, choose what you want to wear, what bands to listen to, what tattoo to get on your butt, and whether you want to get plastered this Saturday. You have a choice about whether or not to major in Engineering, whether or not to join Facebook, and how nice you want to be to your parents.

But as is well known, just because you have choices doesn't mean you're free. If someone holds a gun to your head and says "Your money or your life!" you're not being given a choice. You're being coerced. There are options, and you have to choose, but the latter option isn't an option in any meaningful sense.

By this same logic, it would seem that -- even if there's no robber -- if you make a choice for something you hate because the other options are worse, then in some sense you're not really free in making this choice. You have a low degree of a special kind of freedom I think of as "choice autonomy."

In certain ways, people today have way less choice autonomy than they did when I was young. When I was in my twenties, I worked for a while as a waitress and bookstore clerk, lived in cheap crappy apartments, and didn't have a car, TV or any other expensive stuff.

This was not a bad option. I had enough pocket money for breakfast out, and evenings in bars with friends. I took the bus. Because there were no cell phones and computers and internet, my not having those things was a non-issue. Sure, I had some annoying bosses, but for the most part I worked for small independent restaurants without vast corporate strategies and crap like that.

A life like this now is so much crappier. Of course part of that is economical: the fact that you can barely live on a waitress-like salary these days has a lot to do with relative incomes and rising inequality and so on.

But it's way more complicated than money, because changes in our society have made the life of the non-well-off much worse than they used to be in so many ways. Working a low-paying job now often means working for a giant corporation which has typically worked out in excruciating detail how to get what they want out of workers without considering -- even while benefiting from -- the conditions that make those workers' lives a pain in the ass.

Low-pay workers now often have to deal with unpredictable schedules, no guarantees of full-time work in a given week, absurd and ineffectual policies involving sales targets and quotas for foisting on the public stupid things they don't need. They often have to be on-call, so not only do they need a phone, they can't turn that phone off. Since employers check on social networking presence, and even regard non-presence as a red-flag, workers have to constantly curate their online persona. Naturally, they have to do all this with a huge smile, a friendly hello, and a team-player mentality. It's revolting.

Complex changes in society mean even living on moderate middle class salaries can be challenging. During the burst of the housing bubble there was this surreal situation of cheering for rising house prices and moaning about their falling. I get the reasons -- mortgages, debt, saving, blah blah blah. Still, wasn't it odd not to see anyone spare one thought for the people who might want to buy an affordable house? Or just rent a little apartment for some reasonable rate?

All of this means that even if you win the early life lottery of good parents and money that can fund your education and all that jazz, the crappiness of low-pay work means you pretty much have to choose to fight the zillion other people trying for the brass rings. You don't have much of a choice. Of course, if you didn't win that lottery, forget it. You'll have little access to any good options at all.

Because of these facts, there's a sense of freedom in which people have less freedom, because their choices are not free but rather constrained. This use of the concept is related, I think, to the idea of "positive liberty," but it's not quite the same: I'm not talking about enabling self-determination and realization. I'm talking about having to choose X because all the things that involve not-X are awful -- not because one person made them awful for you in a moment, the way the robber did -- but because the world you live in made them awful for complex interconnected reasons.

If I'm right about choice autonomy it's a concept that can apply to anything. But on Labor Day it seems particularly appropriate to point out implications for worker conditions. If those conditions suck, that's a problem not just for well-being, not just for collective welfare, but for freedom and autonomy as well.

You sometimes hear arguments against rules and regulation justified on grounds that they would be coercive, would unjustly decrease the freedom of people and institutions to do as they see fit. My proposal is that "freedom" cuts the other way as well: when some options are awful, the choice for alternatives also isn't really free.

Economics and The Lost Art of Not Worrying About Stuff

It's not news that when all you have is a ruler, everything looks like a piece of string ... Oh, wait, that's not it.

It's not news that when all you have is a cup, everything looks like coffee. No, no, that isn't it either.

I know: when all you have is an odometer, everything looks like a mile?

OK forget it. The principle, of course, is that when you have only one way of measuring, you only see the things you can measure that way. Which sounds pretty innocuous. But as everyone points out, the fact that you can measure "money" or maybe "goods" but not "love," "community" or even "that pleasant feeling you get crossing little items off your to-do list," means that the economic lens, when you use it, is always distorting your life.

I say "when you use it," but really do you have any choice? These days with the economic lens, you can run but you can't hide. You have to practically fashion yourself some kind of crazed rebel to even have the blandest opinions that contradict what the economic lens shows you.

An example of this I think about a lot has to do with risk, rationality, and the comforts of planning. A few years ago my friend and I had to renew our mortgage for a condo we own. For everyone who doesn't live in Canada: this is a thing we do here, where the terms of a mortgage are only good for five years, and you have to renew or renegotiate or whatever. Obviously it doesn't mean you have a five-year mortgage. Just the terms are only good for five years.

I don't know how this started or who it's supposed to benefit. It doesn't matter. We used what's called a mortgage broker, whose job is to help you find the best deal. At one point, we had to make a decision about whether to accept a certain fixed-rate (for the next five years only!) or go for a variable rate. For certain reasons the broker was convinced that the variable rate would be better in the long run.

I told him, as I'd told him before, that we wanted a fixed rate.

He insisted, as he'd insisted before, that we wanted the variable rate --that it would be better in the long run.

We went back and forth a few times until I just stopped offering reasons and justifications and just ordered him to put us down for the fixed rate. Now, I'm able to do that sort of thing, because I'm somewhat naturally who-gives-a-fuck about things like this and also because years of being a professor has reinforced my ability to just say "no, we're doing it this way." If I'd been a more deferential, shy, or uncertain person -- forget it. We'd have had a variable rate mortgage.

Now, it's worth considering what could make a mortgage broker so convinced that there could be no good reason for preferring a fixed rate -- for preferring it even granting, for the sake of argument, that it might cost you more dollars in the long run.

From various things the broker said, I know one thought he had concerned what he thought of as the irrationality of risk-averseness. The principle behind this idea is that from the economic point of view, money you get is no different from money you fail to lose; money you lose is no different from money you fail to get. So while I might have balked at a risk of losing money, I was not balking at the risk of failing to gain it. And that's "irrational."

I suppose from one point of view, whether something is framed as a loss or a failure to gain might seem arbitrary and then risk averseness would indeed be a bias.

But from the point of view of your actual life, it's obviously not. In increasing order of importance, a non-exhaustive list of reasons losing is genuinely worse than failing to gain:

4. Human lives are enmeshed with commitments and plans, many of which depend on money. You can plan for what you have if you're not going to lose it, but you can't plan for what you might gain if you don't fail to not gain it.

3. People get used to things. Think about your home. Giving up its comforts would be traumatic compared to failing to gain house twice its size and luxuriousness.

2. Not everything is relative for humans. The difference between having three chances to eat per day and having six are small. The difference between having three chances to eat per day and having none are -- well they're about as big as you get.

1. Only the risk averse can Stop Worrying and Actually Enjoy Life. Are people so unimaginative about their lives that they can't imagine anything they'd rather be doing than worrying about their money?  How is the time I enjoy not worrying not factored in? When I factor that pleasure in, the fixed rate would have to far far outstrip the variable rate to even make me consider the variable rate.

But of course we know the answer to the last question. The economic lens doesn't even see that pleasure. There's no way to count it, so it might as well not be there.

For this post, a tip of the hat to my former co-blogger Captain Colossal, with whom I had a meeting of the minds on these subjects a few weeks ago. These days, if you're to be a crazed lunatic who actually cares about having a nice life, it helps to have some fellow travelers with you. 

Buzz Bissinger Wants Beautiful Clothes, And I Do Too

If you've read any Victorian literature, you know that those equestrians also loved beautiful clothes.  This is Anson Ambrose Martin (1787 - 1887), James Taylor Wray of the Bedale Hunt with his Dun Hunter, via Wikimedia Commons.

Did you see Buzz Bissinger's essay in GQ about his clothing obsession?  Probably you did.  If not, here are the facts:  Buzz B. got addicted to shopping for high fashion designer clothing, and spent like 500,000 dollars over a period of a few years.  He bought men's and women's clothing, the flashier and more outrageous the better.  The fact that he had been Mister All-American Sports Writer Guy makes this all the more surprising.  In his essay, Buzz B. reflects on the relationships among clothing, sex, and the desire to feel alive.

The article is titled "My Gucci Addiction," and this leads you to think the article will be, like, shopping, shopping, freaking out, shopping.  But I thought the narrative of the article was more like shopping, shopping, freaking out, shopping, sex, sex, sex, shopping.  Which is, of course, much more interesting. 

Although in certain ways the story Buzz B. tells is clearly one of becoming unhinged, some aspects of Buzz's B.'s experience resonated with me in a powerful way.  Like Buzz B., I have been excited by exciting clothing, and like Buzz B., I've connected clothing with sex and sexuality for as long as I can remember. 

Although I'm not sure I would ever spend 22,000 dollars on a coat, and though I can see why Buzz B. feels so freaked out by his own strange spiral, still I find the form of the desire -- for the perfect article of clothing -- to be one that is familiar and close to home.

Buzz B. finds the experience of buying Gucci clothing and wearing beautiful leather electrifying, and yes, he explores the possibility that what he's really into is S&M, or sex with men, or something.  He makes clear that he is probably, in some sense, sexually bored in the way of the 58-year old man and that is all part of it.


So he tries some stuff.  He has sex with men, and finds that despite the charm of gay guys, it's not really his thing, or at least, it's not the thing he's craving.  He tries trips to sex clubs in Macau and Hong Kong:  again, not really quite the thing.  He tries getting further into cross-dressing, and that's not it either:  it's not so womanhood but rather androgyny that appeals.  It's not about sex alone, evidently, but rather about sex and clothing connecting him to desires and the feeling of the life force. 

Obviously the frame of the piece -- of Buzz B. as a "shopoholic"-- is meant to showcase a point about gender:  that while we associate obsessive shopping for clothes with women, it can happen to a guy, and here's what that's like.

What I want to say about all this is that the case of women is much more like this than is sometimes thought, and we all do a disservice to women when we interpret their clothing and shopping choices in a certain way. 

When women become obsessed with clothes, it's often read in ways importantly different from the Buzz B. narrative. 

1)  It's interpreted as being "into luxury," in a way associated with feminine fussiness and consumerism. 

2)  It's interpreted as showcasing and showing off for other women. 

3)  Insofar as it's interpreted as related to sex and sexuality, it's interpreted not as an expression of sexuality, but rather as a tease.

With respect to this last, there's still something about a woman who gets dressed up in a high style and sexy way that makes people -- men and women both, I think -- say to themselves:  well, she must be looking for sex, and if she isn't, all the dressing up must be an effort to seduce and manipulate people, to get attention, all in some problematic way.

What gets left out in these interpretations is, I think, just what Buzz B. describes:  the desire to feel alive, to feel the surge of pleasure and energy and connectedness to life that beautiful and sexy clothing gives you.  Sure, that can be related to a desire for a sexual feeling.  But if the options on the table for actual sex are a problem, or bore you, or aren't all that appealing for whatever reason, that doesn't get in the way. 

It doesn't get in the way because the connectedness to life is the mixed interplay of desiring and feeling desirable.  This is different from simple pleasure, and obviously, different from the having of sex itself.  It's also different from the simple clothing-as-signal of availability so often used in the common interpretations when women dress up. 

I think one reason it's difficult to interpret women's choices in the more complicated way is that we are caught up in the picture of women's sexuality as responsive or secondary or focused on the desirability question for women that we forget about the desiring part of the equation.  I think a second reason it's difficult to interpret women's choices in the more complicated way is that for all social and cultural changes of the last few decades, people are still bothered, upset, disturbed somehow, by the fact of women's sexual desires being just that -- desires.

Now, if you'll excuse me, I have to go clothes shopping. 

Am I The Problem Of Expensive Tastes? Or, Maybe We're Not Materalisitic Enough

Marie de' Medici, who probably had her own problem of expensive tastes.  By Peter Paul Rubens [Public domain], via Wikimedia Commons.

When I first heard that there was such a thing as "the problem of expensive tastes," my first thought was "Uh oh, that must be me."

I've always had desires for nice things that seemed to know no bounds.  As a child, I was keenly aware of the difference between Sears and Bloomingdales, and could easily distinguish the goods that came from each.  Now, when I go to the mall, I often have a shopping paralysis:  inevitably, when I look at reasonably priced stuff, I'm like "but that is crappy/ugly," and when I find a coat/bag/shoes/whatever that's acceptable, it's hundreds of dollars more than I have to spend. 

I remember when I was a kid, sometimes well-meaning adults would ask, in a make-drive-time-quality-time sort of way, how much money I thought I'd want in order to be "satisfied."  And I would think to myself, "Is this person stupid?"  Even then I thought the question made no sense.  No matter what you had, wouldn't always want more?  I mean, even if you were just going to give it away, wouldn't more always be better? 

Then I got older and learned that most people do not regard the question as nonsensical at all.  Not only do they distinguish an amount of money they'd need to be satisfied, often, that amount was not all that much more than the money they had. 

This was, and is, mystifying to me.  I can't get inside the minds of people who answer this way.  Don't they want beautiful expensive clothes, fancy cars, amazing homes, travel?  Don't they want the nicest antique self-winding watch hand ever made?  Don't they want a pied à terre in New York, another in Paris, a resort home in Italy and a ranch for occasional horse riding out in some other random lovely place?

That shit isn't cheap, you know.  That's not an extra few thousand bucks a year we're talking about.

So what is up with that?  Do people have no imagination -- they just can't think of good expensive stuff?  Or do they think of these things and really not want them?  I don't know, of course.  But I'm guessing for a lot of people it's neither of these, and that what's really going on is that people don't want to seem greedy.

They picture "having a lot" as "having a lot more than other people," and -- correctly, I think -- intuit that there is something distressing about wanting to outstrip your fellows by stratospheric distances. 

But having a lot is different form having more.  The matter hinges on whether luxury, and thus luxury desires, are relative or absolute.  I had to do a certain amount of soul-searching to determine for myself whether my own luxury desires were primarily relative -- as in, I wanted nicer things than other people -- or absolute -- as in, I want nice things. 

I may be deluding myself, but I'm pretty sure I just want nice things.  My needs are absolute, not relative.  There are a few bits of evidence.  I always enjoy being around other people who have beautiful clothes, bags, shows, cars, etc etc etc., and my enjoyment of the nice things I have seems to increase, rather than decrease, when more people have similar, or similarly nice, nice things.

My iPhone is a perfect example.  I love my iPhone.  In terms of being a nice things, it's one of the nicest.  I love the exquisitely lovely green battery icon that pops up when the phone is charging.  I love the little raindrops on the home screen.  I love the fonts.  And I can honestly say that my love for my iPhone is increased, rather than decreased, by the iPhone's omnipresence.  This is an absolute, not a relative.

The classic "problem of expensive tastes" in philosophy has to do with the idea of fairness and equality in measuring well-being.  If you think fairness and equality should measure how well a person is doing, rather than, say goods and resources, you run into the obvious problem:  if X can't be happy without a Birkin bag and Y sets her sights on a more affordable (but still pricey!) Roots bag, then equality of well-being seems to mean things are fair and equal when X gets the Birkin.  But that doesn't seem quite right.

Understood this way, "the problem of expensive tastes" is a problem that arises within a scheme in which the resources are fixed, or at least limited, and the question is the distribution.  And it seems likely that all those people who mystified me by answering that to be "satisfied" they only needed a bit more in the way of worldly goods:  if there's only a certain amount, perhaps it would be unseemly to want not only nice things but things much much much nicer than anyone else. 

My interpretation would then be the unusual one, imagining as it does that I can have the nicest things, and everyone else can have the nicest things, all at the same time.

But though my interpretation may be unusual, I think it is apt, because there's an important moral difference between absolute luxury and relative luxury.  There's nothing inherently wrong or creepy about desires for absolute luxury:  these desires are completely compatible with real equality, even with everyone having the same.  If you want absolute luxury, you want to have your fancy car and vacation home and horse ranch, but you also want everyone to have those things.  If you want relative luxury, that's more morally complicated, because you want to have what others do not have.  You want, in a sense, to make other people feel bad.

I wonder if an increase in relative luxury desires is something we are, depressingly, moving toward.  I tried to confirm, by Googling, my memory of studies showing people really only wanted a bit more, and it wasn't easy.  Because every study I found attempted to answer the completely different question of how much a person "really" needs to be happy (answer:  about 75,000, in the US in 2012).  The implication, I suppose, being that people think they need much much more. 

Anyway, as a person who cares about absolute, not relative, luxury, I can tell you one important thing:  desires for absolute luxury have to be desires for material qualities in and of themselves, and not desires for material qualities as symbols of something else.  To want absolute luxury, you have to care about this bag, that scarf, this car, that home, and so on and so forth, to care about the particular qualities of the things you want and sometimes have, and not about what they represent.  

You can't want nice things as symbols of something else, like status.

And even though we're supposed to be so "materialistic" in this culture, I think we're not always so good at that.  We buy symbols, not things; we buy as means not as ends; we buy for novelty and not for the long haul.  Being truly materialistic would mean amassing things you love, and loving them for a good long time.  Loving them not because they stand for or represent something else, but because they're beautiful in and of themselves.

That kind of materialism never begrudges the luxury items of one's fellows.  It allows a love of luxury to be compatible with egalitarianism. 

So am I the problem of expensive tastes?  In an immediate sense, clearly yes: in a scheme of equality of happiness and well-being, I would cost more than my fellows.  In another sense, though, no: I'd like everyone to have expensive tastes.  And if they did, the problem would just go away.

Birkin bags for everyone, please!

Distributive Justice In Victorian Children's Books

I was a little under the weather the past few days, and as entertainment I decided to read a bunch of Victorian children's novels.  Children's novels -- because what's nicer when you're sick than kids' books?  Victorian -- because of the copyright laws.

If you don't already know, if you have an e-book reader you can read many many out of copyright books, downloadable from various sources but mostly Gutenberg.org.  You used to be able to read these books with the amazing app Stanza, but Amazon bought Stanza and closed it down or something so that people would use the Kindle app and be tied to the Kindle versions of the books.  That's too bad.  But now there's an app called MegaReader ("MegaReader"? really?) that does pretty much the same thing. 

The way the timing works out, many books that are just now out of copyright are from the Victorian era, or just after it.  (Info about duration of copyright at this wikipedia page).  It's kind of interesting, actually, the way the law functions to reacquaint readers with a specific time that moves forward as we do.

I started by rereading some known favorites:  The Secret Garden; A Little Princess.  Then I realized I'd never read Doctor Dolittle, so I read a couple from that series.  Then I found the Pollyanna books, and was like "OMG you mean the idea of "being a Pollyanna" = "being annoyingly optimistic" comes from an actual book and I didn't know that already?"

What struck me on reading them all the same time was their shared obsession with the problems of suffering and poverty and the ... shall I say "limited"? ideas they bring to bear on the problem?

Doctor Dolittle is about a kind and good man who never wants anyone to be unhappy.  So far so good!  His solution to the problem of money, though, is just not to think about it ever.  He takes things as they come, does good where he can, and ignores the rest.  It's the animals, especially the wise parrot, who organize things so that there's food on the table. 

And speaking of food, the animals are often the poor and downtrodden in this book, which recounts the misuse of horses, the pains of animals in zoos, and the sufferings of fish in aquariums.  So ... when it comes right down to it, what do we do about the fact that people eat animals and animals often eat one another?  That doesn't come up in the book.  I thought the kind Doctor would have to be a vegetarian at least, but the topic never arises.

Moral:  poverty is bad, so be nice to everybody and try not to think about it very much.

With A Little Princess, I remember even when I was a kid I was weirded out by way the happy ending has lovely Sara Crewe transformed back into a wealthy and happy child and her best friend Becky transformed into ... her maid? 

Sara starts off wealthy, but through a mistake is thought to be a penniless orphan. She's put upstairs with the domestic servant Beckie.  The book recounts their sufferings with horror, and the book is clearly about how awful it is to be poor in England in the late 1800s.  I guess to a certain imagination, the answer to the suffering of the poor is not to lessen inequality but just for rich people to be nicer to poor people.

Moral:  poverty is bad, so be nice to poor people and their lives won't suck so much.

The Pollyanna books don't really get to the problem of poverty 'til volume two.  The first book is all about Pollyanna being Pollyanna.  She teaches everyone to play the "glad game" -- where you find something to be glad about in every situation.  It's to the book's credit that when Pollyanna is in an accident and thinks she's crippled for life, she cannot play the game at all -- her only consolation is that other people she's been nice to over the years drop by with warm wishes.

In volume two, Pollyanna goes to Boston to stay with a family friend for a few months, and there she encounters actual poverty:  people who haven't enough to eat, and live in squalor.  She can't find anything to be "glad" about about that situation either.  Her solution is to make friends with some poor people, and then make life better for them.  In the course of the books she arranges two formal adoptions of poor orphaned children by wealthy and previously sour-minded adults.

Moral:  poverty is bad, so find a few poor people and bring them to live with you in richlandia.

Pollanna seems to have more advanced thinking on the subject than anyone else; at least she actually wants to make poor people richer instead of just tossing them a muffin here and a kindly word there. 

The adults in the book warn Pollyanna, though, that too much in this direction leads to "socialism." So she'd better be careful.

Plus ça change.

What Do Men Want When They Pay For Sex?

Toulouse Lautrec, Reine de Joie, via Wikimedia Commons here.

What do men want when they pay for sex?  I thought I sort of knew the answer to this question, and I thought it was something like this:  men want the experience of having sex, with the ability to have some control over what their partners are like, without the difficulties of attracting other people, and without the difficulties of being nice to those other people during the times they're not actually having sex.  This answer would apply in the same way to hetero- and same-sex paid sex. 

But there are men out there who aren't interested in paying for sex at all.  I mean, there are men who say that the whole point of having sex with a person instead of masturbating is to experience the desire or somehow the general subjectivity of the other person.  Without those, there's pretty much no point to sex over masturbation.  And of course, the experience of another's genuine desire or subjectivity is, in a way, just what you have some trouble obtaining if you're paying for sex, because presumably showing certain patterns of desire or feeling is part of what the person you're paying is being paid to do. 

From this point of view, and for men like this, it does seem that seeking out a sex worker would make less sense than, say, attentive masturbating with really high quality pornography.  I mean, you can recreate many of the relevant physical sensations  -- can't you? -- and even in the best circumstances setting up an appointment with a sex worker is going to cost time and money.

But of course there are plenty of men who do seek out sex workers.  What makes it worth it for them?  I mean, masturbation technologies ... haven't they gotten pretty good?  If you can replicate the physical sensations pretty well by masturbating, and if you're not in it for the desire and subjectivity of the other person, what are you in it for?

Maybe the answer is something like this:  there's some kind of vagueness and haziness in "desire" and "subjectivity," and there's some kind of mental state between credulity and skepticism that allows the fiction of mutual desire or interest or whatever subjectivity you're interested in to be maintained in the moment.  So you pay to have sex, and the sex worker is genuinely in the moment in some way, and is acting in some other way, but because of the nature of the interaction, it's possible for the client to be momentarily pleasantly deceived that there is mutual desire or interest or whatever subjectivity you're hoping to have in your sex partner.   

That is, I believe, a kind of answer that makes sex work seem, on the face of it, like it could be an OK thing -- assuming, of course, that sex workers are all in control of their activities and being treated with respect and all that.  It's also roughly consistent with my original answer.  We might call it the "pleasant fiction" answer. 

But my thinking on this subject was cast into some doubt by reading Chester Brown's excellent recent graphic novel, Paying For It, which is about Brown's years of having sex with sex workers after his relationship ends and he decides an actual girlfriend is too much trouble.

Part of what surprised and even distressed me was how fussy Brown gets about the physical appearance of the women he has sex with.  I mean, in the beginning he's nervous and grateful when things go well, but as time goes on he becomes more and more attentive to the physical attractiveness-dollar ratio, along predictable dimensions.

That's his right, I guess.  But it felt so ... ungenerous somehow.  Maybe this is the girly-girl in me coming out, but I think to myself, Hey, this person is having sex with you; sure you're paying her, but she's giving you this very intimate thing.  Can't you be a little nicer, or warmer, or more grateful about that, Mister Critical?  It's true that Brown is respectful and kind.  But that doesn't quite make him warm or generous. 

There's also a grim moment in which a sex worker does something particularly erotic, and instead of thinking, "Wow, Sexy," Brown just thinks about how she's just doing that so he'll have his orgasm faster and get out of there.  He feels manipulated and annoyed, and he responds by acting like a grouch.  It surprised me to see that sort of gesture take on such an opposite valence from what it usually has. 

Both of these things, it seems to me, kind of challenge the "pleasant fiction" interpretation.  Because they both highlight the differences rather than the similarities between sex with the sex worker and sex with some person you happened to like who happened to like you. 

They're both the approach of the consumer, not the lover.

But that makes my original question seem somewhat more puzzling.  If a guy's not in it for the experience, in some sense, even for a few minutes, of playing the lover -- and of course I don't mean "lover" as in the sense of "in love," but just in the sense of having sex out of desire and attraction -- then what is he in it for?

I found myself wondering what Chester Brown was getting out of these visits that he couldn't get more cheaply and easily from a few toys and a good broadband connection. 

The Hedonic Stairmaster

The "second most expensive watch in the world," at least according to these people.

A couple of weeks ago my watch broke, and I decided to buy a new one.  I knew -- at least, I thought I knew -- what I wanted:  something rugged, large-faced, aggressively styled, water-resistant, and not to expensive.

At the store I found it -- it-who-will-remain-nameless.  It was large-faced, and water-resistant up to 30 feet.  It had a simple face, without one of those little "date windows" that I've come to feel are so annoying.  It was 35 dollars.  Canadian.  I bought it.

But two days later, it was broken.  I brought it back, and I was back in the market.

That's when I started climbing.  I wanted "something nicer," maybe something a bit more expensive.  First, I wanted a cheap diving watch, maybe 100 dollars.  But then I thought, well if you're going to get a diving watch, get a nice one.  You could spend, what, 300 dollars.  But then I was at these websites where 300 dollars is the "clearance" section and I caught sight of some real beauties, and I thought wow, a person could really enjoy that watch.  And it's, what, only 1,000 dollars.

Then I was listening to that song "Hot" by Missy Eliot which is such a hilarious send up of wanna-bes and con artists, where she calls out a guy who tries to rent a Bentley and pretend he's rich.  "Yeah boo you know you a joke, wear a fake Rolex, call it a Ro."  I like hip hop music, and though I know this shocks some people, I kind of love the crazy materialism of it, the lux brands obsessions.

And so I thought, Yeah. A Rolex.  Turns out there are even Rolex diving watches.  I can't tell you the price because the site I looked at took a distinctly If-you-have-to-ask-it's-too-expensive approach.

Then I remembered an old friend who was kind of into watches and how he told me about these antique self-winding watches with super craftsmanship and I thought "Yeah, wow, that's what I want."  And then I though of all the even cooler really old beautiful watches and how spectacular it would be to own something like that.

Before I knew what hit me, I had decided that only the Nicest, Most Expensive Watch in the World could possibly be really satisfying.

In a way I'm not surprised, because much as I love it, that's what consumer culture is like.  As long as N+1 object is nicer than N object, how can you be satisfied with any N?  You always know there's something better.

I call this The Hedonic Stairmaster.

Maybe you've heard of the Hedonic Treadmill?  This refers to the fact that people constantly adjust to the current status quo.  So that to feel the same happiness or pleasure, you can't just continue with the same state of affairs, you need that state of affairs to get better and better.

The Hedonic Stairmaster is different; it's a distinctly consumerist problem.  The Hedonic Stairmaster means you have to keep climbing.  It's never enough to have a mid-range thing, it's never enough to have a really-quite-nice thing; it's never even though to have a really nice thing.  Whatever it is, it'll seem shabby next to the even nicer thing, which you know is out there.

There is only one way I know off the Hedonic Stairmaster, and that's to have a sense of cool that does not track expense.  Real rebels do this, as do punk rockers, hippies, and goths.  Wonderful if you can manage it.  But like other ways of being Against The World, it gets harder as you get older.  

Sex In The House Of Holes: Cute Or Sad?

I just finished reading Nicholson Baker's House of Holes.  Maybe you know, it's a novel about a sexual theme park.  Not just dildos and 360 porn movies, but rather a place you can go and exchange genitalia in a "crotchal transfer," or trade your arm for a larger dick, or have sex with just the arm the guy forfeited in the exchange. 

I like Nicholson Baker's work a lot.  He wrote the highly amusing U and I, which chronicles his obsession with John Updike; Vox, which is the transcript of a very long phone sex conversation between a nice guy and a nice girl; and The Fermata, which is about a guy who learns how to stop time for everyone else but do as he pleases while no one knows.

Many images from The Fermata have stuck with me for years.  Especially vivid is a scene in which Our Hero talks to a taxi driver, who says that if he could stop time, he would force a woman down, lubricate her with black grease from NAPA auto parts, and have his way with her.  Our Hero is appalled.  In addition to being appalled, though, he's disappointed by the fact of how little he and the taxi driver have in common.  We want, he says, to think other people are like us.  I think that is true.

In The Fermata and Vox, the characters have a distinctly Bakerian style.  The guys are Good Guys with Large Libidos and a Wholesome Attitude Toward Life.  They want to have a good time; they want their partners to have a good time, too; and even when they have kinks and obsessions they are good-natured and cheerful about them.  The Bakerian women are GGG for sure, but they're also not shy about saying No, Sorry, That's Not For Me.

So that's  . . .  nice. 

To some extent the same nice atmosphere pervades House of Holes.  But when you think "sexual theme park" -- well, when I think "sexual theme park" -- you tend to think not just adventure but also something utopian.  Like, if it's a theme park, you can get right to the really good things without any anxieties, fears, or whatever getting in the way.

And it is like that, in some ways.  There's lots of funny, good-natured sex.  The woman who has sex with the forfeited arm is very satisfied, and eventually gets to meet the owner and return the arm.  That's cute.  There are lots of funny puns and names, like when a guy calls his dick his "Malcolm Gladwell."  Also, cute.

But for a theme park, there are some surprises.  Most surprising to me was the the fact that it's expensive.  Men have to pay.  A lot.  And if they can't cough up the cash, they have to perform some service.  Like the man with a nice body and ugly face: he has to do time as a headless man -- desired, of course, by the women who want to have hot sex with a guy without being sized up, criticized, found to be too fat, whatever.  With no head, the guy can't even see you.

Expensive? A theme park?  What is up with that?

I was also surprised by the rules and punishments.  One man isn't supposed to put his finger  -- well, never mind.  But he does.  And I don't remember, but I think he gets his dick taken away or something.  This, mind you, not because the woman in question didn't want, but somehow just because it was some rule about how his involvement was supposed to be structured.

Maybe there is some deep point lurking here about sex, cost, and inevitable sacrifice.  I'm not sure.  In any case, it's a little sad. 

Also, surprisingly heterosexual, the House of Holes.  This is also a little sad.

My favorite thing in the book is the "Deprivos," who haven't been allowed to see nude breasts for three full weeks.  After doing their time, they line up in the places that naked women are likely to be, dying for a glimpse.  After a ride on the "pussyboard" on the White Lake -- known for its magic rejuvenating powers of clitoral healing -- some women feels so good they want sex immediately. Fortunately, there's a line of Deprivos, at the edge of the lake, just waiting.

A group of people, in a highly appreciative and uncritical mood, eagerly awaiting your appearance, anticipating your arrival, and really happy to see you.  It's a pleasant thought.

Capitalism And Fraud

Recently I read Michael Lewis's book The Big Short, which tells the stories of a few people involved in the financial shenanigans that led to the economic crisis of 2008. 

It's a complicated story with a lot of parts, but one of the recurring elements is intentional deception.  I mean, cases in which banks and investment companies intentionally mislead, lie to, and try to deceive their trading partners and customers. 

This got me to thinking about lying and fraud in business in a more general way, and about why you're not supposed to do it, and about why any particular business person would be motivated not to do it.

When you're in a normal moral context, it's natural to think of morality as a kind of "looking out for the other guy."  I mean, you take other people, and their needs and desires, into consideration when you think about how to act.  From that point of view, the reason not to lie is pretty obvious, because you're in doing so you're harming someone else or their interests.

Does this normal moral context disappear when you're in a business context?  Sometimes it doesn't.  Some transactions, like selling coffee or whatever, don't seem in tension with that point of view.  If I have money, and you have coffee, and we want to exchange, we're each going to be better off after we do so, and this is consistent with each of us looking out for the other guy.  So you might have some interest in putting the best face on your coffee that you can, but there would be nothing strange about your telling me the truth about its particulars and why you want to sell it. 

But what Lewis describes in the finance industry doesn't quite seem like that, because everyone wants the same thing -- money -- and everyone's just making different and competing judgments about the best way to get it.  If your reason for wanting to sell me certain stocks for money is that you think they're going to be worth less in the future than they are now, then there's a sense in which our interests are opposed, and it makes no sense to "look out for the other guy" in quite the same way.  Why would you reveal your reasons for thinking the stock was going to go down?  Doing so would make no sense.  In this context, it would be strange for you to tell me why you want to sell.

So the prohibition against lying must have another source in that context.  And I take it it does:  the system depends on people being having good information about what they are buying; the system doesn't work when people lie; the mechanism of capitalist exchange, investment, and all the good things that come with it are only possible if people tell the truth. 

But if that's the real reason why one ought not lie in finance, isn't it really unsurprising that in the absence of meaningful oversight and punishment, people do, in fact, lie?  Because, really, even though I take it this is a powerful and good reason not to lie, it's also an awfully abstract and emotionally non-pressing reason.  A reason it's pretty hard to get motivated by.  There might be some people who might be worse off at some unspecified future time?  Whatever.

And the temptations to lie must be significant:  you're trying to keep up, and your job depends on making a certain amount of money for your company or its shareholders, and everyone else is making money, and you think that everyone else is lying.  Against these temptations you have something like: it's wrong for me to lie because if people lie the system breaks down?  You'd have to be Mr. Spock to put that sort of reasoning into action against your own immediate self-interest.

It might be thought that the motivation not to lie, even in the absence of oversight and punishment, comes from some self-interest:  that the person who lies is going to get a reputation for lying and people won't do business with them again.  But this would only be true if a lot of people had information that -- especially in the absence of oversight -- people just don't have.  Without someone looking over your shoulder, you can actually get away with it.

One of the other main themes of the book, of course, is how pathetic and weak any actual oversight is these days.  But that's another story.

Caring More About Keeping What I Have: Bias Or Preference?

This is going to have to be short because it's the first day of school and I haven't got my lunchbox ready or my shoes shined and I don't know where my classroom is or who my homeroom teacher is going to be.

Fortunately, today's topic is pretty simple. It's often pointed out that people generally don't think the same way about losses and gains. We tend to care more about losing what we have; we tend to think the status quo is somehow standard. We think about income and spending completely differently.

For example, the amount I'd pay to have someone clean my house is totally different from the amount you'd have to pay me to make me think cleaning someone else's house is worth my time. But why? It's not like the amount of housecleaning to be done is set in stone; both choices involve a trade of housecleaning for money. And yet the two feel totally different. In the same way, I wouldn't place a bet of any substantial amount of money, even if I thought the odds of winning were really really good.

Essentially, I care more about keeping what I have than about getting more. Is this a bias? Or a just preference? Sometimes you hear it suggested that there's something vaguely irrational about it. Writing (about other things) in the Times recently, Paul Krugman says,

"Behavioral finance, drawing on the broader movement known as behavioral economics, tries to answer that question by relating the apparent irrationality of investors to known biases in human cognition, like the tendency to care more about small losses than small gains or the tendency to extrapolate too readily from small samples (e.g., assuming that because home prices rose in the past few years, they’ll keep on rising)."

OK, fine, but why is "the tendency to care more about small losses than small gains" a bias, and why is it irrational?

I mean, I see why it's wrong to extrapolate too readily from small samples -- if you do, you'll make an incorrect prediction about what's going to happen and you'll act accordingly and you won't get what you want. But there's nothing analogous about caring more about small losses than small gains.

I care more about small losses than small gains because:

1) Part of the pleasure of enjoying the things I spend money on is the feeling that they are going to continue, and small losses often mean they won't. I like to drink wine, but I would be far unhappier to have to stop because I can't afford it than I would be happy to be able to afford fancier brands. Sure, fancier brands would be nice, but I feel only tiny amounts of frustration at not being able to afford them. Nothing like I would feel at having to downgrade, or give it up. Looking forward to next time is a big deal, and you don't really look forward to stuff you've never had. Or not that often, anyway.

2) Like most people, my financial life involve a range of money committments: a mortgage, ongoing bills, a cellphone contract, internet for my home. Other people have even more complex committments: kids' tuition, say, or insurance for expensive things they own. The impact of a small loss on these is great: I have to figure out some plan, change things around, lose things I've gotten used to (see 1). The impact of a small gain -- especially a one-time gain -- is somewhat significant, but it's not big in the same sort of way.

With respect to 2), I remember once when I was a graduate student, a faculty member told me they couldn't live on 80 percent of their current salaray (which is what they'd get if they did a year sabbatical or something). At the time I thought, Really? But thinking it over it makes sense: when you have any regular income, you structure your life according to it. Small losses are a huge deal.

So my answer is: Caring more about keeping what I have seems a preference, a legitimate one, and not a bias.