I knew things were bad but not that they were this bad. Now even Goldman Sachs and Morgan Stanley, the last two surviving major investment banks, are becoming commercial banks. The whole industry is gone. What a plunge, from the top of the world to giving up their business model, in just a year.
I’m not there any more to take part in this but somehow I still feel sad about this.
I’ve been following the news about the financial crisis more than the average person, because I used to work in that industry. Even so it was a shock to hear that two more investment banks are gone: one selling itself and the other bankrupt. I knew things were going badly, but not that they were this bad. I find some pleasure in the fact that the bank I used to work for hasn’t collapsed yet, but I wonder what the mood is like, and how much the firm will have to change due to the crisis.
I’m glad we didn’t have the means to buy a home when we moved to London 7 years ago – otherwise we would have had to either postpone our move back to Sweden, or to try and sell a home in this year’s stagnant market. And it was really lucky that we found a house this spring – if we had been looking now, we wouldn’t be able to buy anything, because the market is all but standing still.
When all this is over I will have to try to find a good book about this crisis. I’m losing track of all the collapsing dominoes.
Via Bruce Schneier I found this essay by a mom who let her 9-year-old son take the NY subway home on his own.
Long story short: My son got home, ecstatic with independence.
Long story longer, and analyzed, to boot: Half the people I’ve told this episode to now want to turn me in for child abuse. As if keeping kids under lock and key and helmet and cell phone and nanny and surveillance is the right way to rear kids. It’s not. It’s debilitating — for us and for them.
Even more interesting is this graphic that Bruce links to, showing (anecdotally) how children’s freedom of movement has decreased over the past 4 generations. While I think some of this decrease is sensible (the 8-year-old in 1919 did not have to cope with cars doing 70mph on busy roads), much of it is due to excessive anxiety.
I am also reminded of this TED talk about 5 dangerous things you should let your kids do.
Those of you living in Estonia are probably all too aware of the situation around the Bronze Soldier. Those outside Estonia may well have missed it.
The Bronze Soldier is a monument, located in central Tallinn, to honour the Soviet soldiers who died in WW2. While the Russians think of the Soviet Army as liberating Estonia from the Nazis, Estonians cannot ignore the 50 years of occupation that followed. The statue had therefore become a magnet for both Estonian and Russian nationalist youth, so the government decided that the statue as well as the dozen-or-so soldiers buried underneath it should be moved to a less central location (a war cemetery).
The decision did not go down well with the Russians in Estonia or with Russian officials. The former have now spent two nights rioting – 1 killed, 150 injured, 800 arrested, numerous shops looted. The latter are threatening to sever diplomatic relations.
You can read more in most international news sources (Google News search). Eesti Päevaleht offers a concise summary in English.
I can understand the upset feelings, to some extent. But I cannot understand how the rioters or the Russian government can hope to achieve anything positive through their actions. Looting a Hugo Boss shop and liquor shops? Powerful political statement, that.
By the way, Itching for Eestimaa is a good place for commentary on Estonia and Estonian events.
In an interesting essay, The Myth of the Rational Voter, Bryan Caplan argues that the average voter holds erroneous beliefs about issues they vote on. (Found via Arts & Letters Daily, an excellent daily roundup of thoughtful and interesting writings from all sorts of places.)
…if you know what a voter thinks is best for society, you can count on him to support it.
Before we can infer that the policies that are best for society will actually prevail, however, we have to add the very assumption I am challenging: that the beliefs of the average voter are true. If his beliefs are false, his good intentions lead him to support policies that are less than optimal, and possibly just plain bad.
How can the public keep making costly policy mistakes, year after year, century after century?
Public choice economists are used to blaming what they call “rational ignorance.” In elections with millions of voters, the personal benefits of learning more about policy are negligible, because one vote is so unlikely to change the outcome. So why bother learning?
In my book, however, I argue that rational ignorance has been oversold. Rational ignorance cannot explain why people gravitate toward false beliefs, rather than simply being agnostic. Neither can it explain why people who have barely scratched the surface of a subject are so confident in their judgments – and even get angry when you contradict them.
My view is that these are symptoms not of ignorance, but of irrationality. In politics as in religion, some beliefs are more emotionally appealing than others. For example, it feels a lot better to blame sneaky foreigners for our economic problems than it does to blame ourselves. This creates a temptation to relax normal intellectual standards and insulate cherished beliefs from criticism – in short, to be irrational.
I have to admit that I agree with his proposed remedy of limiting voter power regarding some areas of society. On some topics, opinions are not enough – knowledge is also required to make sensible decisions.
Speaking of pointless security measures (again), Eric made an interesting observation yesterday. Now that airplane cockpit doors are locked, what is the purpose of forbidding sharp items on flights? Sure, someone could take the entire airplane hostage and start threatening to cut people. But that would gain them nothing, as no pilot would give in to their demands.
This looks like a good example of how security measures stay in place even after they’ve outlived their usefulness. Things get onto the forbidden list far more easily than they get off the list.
The latest security restrictions in place in airports and on airlines are simply ridiculous.
British Airways:
Customers travelling from the UK will be able to take on board as hand baggage one cabin bag no bigger than 45cm x 35cm x 16cm, the size of a small laptop bag, inclusive of wheels and handles.
Cabin baggage MUST NOT contain:
- Any cosmetics
- Any toiletries
- Any liquids
- Any drinks
- Cigarette lighters
Cabin baggage CAN contain the following:
- Electronic equipment, including laptops, mobile phones, digital cameras and portable music and DVD players
- Essential medicines in liquid form provided they are under 50ml. Customers will be asked to taste the liquid. If they cannot taste the liquid for any reason they will be asked to go to an airport pharmacy to have the medicine verified.
- Baby milk and liquid baby food (the contents of each bottle MUST be tasted by the parent)
Nothing must be carried in pockets.
The TSA’s list says the same thing but with more detail, carefully forbidding such things as gel shoe inserts and eye drops.
And what is the point of this? How many terror attacks have been avoided by forbidding liquids? Not a single one. The suspected terrorists who were caught, were found through old-fashioned spy work.
The airline security people are thinking about and reacting to the last attack, not the next one. And not reacting in a rational way, either. There has been no analysis weighing the costs against the benefits. The measures put in place are unlikely to have much positive effect, while they cost a lot in money as well as lost time. It’s all security theatre, to use Bruce Schneier’s term: the people in charge want to be seen to be doing something, anything, no matter whether it’s efficacious at all. And of course, they don’t bear the costs, either.
If history repeats itself – which it often does – and things go the way they did after 9/11, these measures may be relieved somewhat, but a large part will become part of a new system and will remain in place for years. Just think of all those concrete barriers and blocked-off roads in lower Manhattan, and all the bag checks at every public building, including museums. Like the liquids thing, it’s mostly theatre: the bag checks at London’s museums are cursory at best. But once they’ve been put in place, they become sticky and remain, no matter how useless and annoying they are.
All this theatre achieves is whipping up hysteria. Which, as many people have pointed out, is exactly what terrorists would want.
Here are a few good articles about how we (that’s “we” in a very loose sense) are letting terrorists scare us into ridiculous and irrational behaviour.
Bruce Schneier on overreactions to so-called “security threats” and more of the same from Salon. The dropped iPod story is among the most ridiculous, but there are so many more that it’s hard to choose the most egregious ones among them.
For a longer-term perspective, read Cityscape of Fear, a Salon article about how security measures (of dubious value) trump design in architecture and planning. And again, appearances matter more than actual efficacy:
“A lot of security folks are trained to believe that a place needs to look secure,” Chakrabarti says. Indeed, one of the paradoxes of security infrastructure is that sometimes appearance can be more important than actual strength. A Tiger Trap is more effective at blocking a truck bomber than a Jersey barrier – but a Jersey barrier looks more menacing.
I don’t want to go along with this any more. I have – luckily – no flights planned for the near future. And when we plan our next holiday, I’m more likely to choose someplace I can get to by train. And I am turning back from entrances that impose yet another gratuitous bag check on me, most recently at the Scottish Parliament building.
I want the rest of the world to wake up and see the absurdity of what is going on.
PS:
On second thought, the silliest “security” action is pretty obvious after all: not allowing someone to fly because they had Arabic text on their T-shirt.
It is interesting, I think, that of the 20-odd people who were arrested in connection with the terrorist plot earlier this month, 3 were converts to Islam. Islam is becoming the default choice for angry young men, I guess.
When I was young 10–15 years ago, disaffected young men with a grudge against “the imperialist society” were drawn to communism / Marxism / Leninism etc. Now that communism has been solidly discredited as a way of running society, they had to find themselves a new pet ideology, and Islam was conveniently available.
There is something in angry young men that pulls them towards the “anti-establishment” movement du jour, one that offers a neat one-size-fits-all solution to the world’s problems, preferably with a strong authoritarian streak.
Some grow out of it, others don’t. And for those who don’t, it will be just like faddish clothes: a sign that can be used to tell when they stopped growing. If a man is (seriously) wearing long hair and brown flare cords, he is stuck in the 70s. If he preaches communism, he stopped paying attention to the world in the 80s. And if someone is still preaching Islamic fundamentalism 20 years from now, he’s stuck in the 00s.
I was thinking about this terrorist plot that was uncovered earlier this week. It struck me as interesting that airplanes are still among terrorists’ main targets, despite all the extra security measures that have been put in place in recent years. Why would that be the case?
Wherever I turn, it’s impossible to not read and hear about what’s now termed “the Muhammad cartoons controversy” or even the “cartoon wars”. Let’s hope it doesn’t get to that.
Firstly, I was disappointed with how hard it was to actually find the cartoons in question. I couldn’t have a serious, considered opinion on the issue without seeing the cartoons that sparked the fire. You would think that when an issue occupies so many minds, newspapers and web sites would go out of their way to spread the information. That’s their job, after all. But instead they have mostly chosen to keep quiet, and I found a copy of the cartoons on a blog. The Times put it well:
And so we have two media now in the world. We have the mainstream media whose job is increasingly not actually to disseminate information but to act as a moral steward for what is fit to print, to become an arbiter of sensitivity, good taste and political correctness. And we have web pages like Wikipedia or the blogosphere to disseminate actual facts, data, images and opinions that readers can judge with the benefit of all the facts, not just some of them.
Once I found them, I was surprised to see how innocuous and anodyne they were. Most of them made no real political point at all, apart from commenting on the contentiousness of depicting Muhammad at all. The ones that “voiced” an opinion were quite mild. If images like this cannot be printed, then that means nothing even remotely critical of Islam can be printed. And the cartoons are not gratuitous insults; they deal with highly relevant topics. What is the main thing about Islam as a culture that concerns westerners? The threat of islamist terrorism would be one of the first things mentioned, along with the rights of women (or lack thereof). If Islam’s links to terrorism is not allowed as a topic for satire, what is?
By now, the cartoons themselves are only a small part of this, of course, and discussions around the newspaper’s decision to publish, other media’s reactions, politician’s responses etc are more important.
I don’t think that it was wrong to publish them, because “someone might take offense”. This is exactly what free speech is about! The right to say things that will offend no one does not need to be set in law. The right to voice opinions that someone might dislike is what needs protection.
I am disappointed that Western leaders (and Jyllands-Posten themselves) apologised for the publication of these cartoons. It sent the signal that all of our principles are up for negotiation, and we don’t really stand behind them very strongly. If someone complains loudly enough, we’ll back down. As The Economist put in a leader, the support for free speech has degenerated into “I disagree with what you say and even if you are threatened with death I will not defend very strongly your right to say it.” What, then, do we stand for?
The Western civilisation (or part of the political and intellectual leadership in the West) is developing an odd practice where they give in / half-heartedly agree with what its opponents say, out of a misguided understanding that this will somehow improve relationships. Turning the other cheek, so to say. Ayaan Hirsi Ali put it well in an interview for Salon: “We are constantly apologizing, and we don’t notice how much abuse we’re taking. Meanwhile, the other side doesn’t give an inch.” Tolerance is taken so far that we become tolerant of those who preach intolerance. As a civilisation, we are afraid to take a stand for our views. Political correctness is metamorphosing into self-censorship.
This reminded me of another opinion piece (in the Wall Street Journal) I read a while ago, about “our lack of civilizational confidence” and the imminent danger of extinction of the West. Much of the article is a rant, and not particularly well-argued. But one brief point got my attention: the argument that Islam has a brighter future than Western secular democracy.
What’s the better bet? A globalization that exports cheeseburgers and pop songs or a globalization that exports the fiercest aspects of its culture?
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