A Look at Economics, Music of the Season, The Increasing Silliness of Washington

This post will be in three entirely separate sections, mostly unrelated.

Economics: A report of some thinking on this subject
I don't talk about Economics much, except to hurl insults at the discipline.  I have to confess that I have never studied the subject; I just peek in through the windows of it, and make faces.  But a recent article sheds a little light on where these fellows are coming from.  It gives a brief summary of the history of the subject, which helped me, and might help you.

Up to the time of the first Great Depression (The Great Depression), the article says, it was the so-called Marshallian Economics that held sway.  (I assume that this was the same Marshall of the Marshall Plan, which had something to do with --at least--American policies on foreign aid.) Added later: No, this was a different Marshall.

Around the time of the Depression, John Maynard Keynes's economic theories started receiving increased attention.  It was the ideas of this fellow that forms what is, to my mind, the dynamics of conventional economic thinking: how government intervention results in the response of the markets :  labor, goods, and money.  It remained the standard economics, and, the article says, continued to give good results until the Seventies.  Bear in mind that various things influence the interaction between the raw materials of economics: laws about the way banks are allowed to operate; invention of credit cards; the way gasoline is used, and so on.  Every once in a while, an economic theory can be expected to stop working the way it had been.

Around 1975, there were some new thinkers: Milton Friedman, who won a Nobel Prize, and a little later, Robert Lucas.  These guys pointed out some mistakes in the thinking of how the actions of individuals are sort of aggregated to predict how particular conditions will influence conditions in the future.  The main ideas are the same: changing a set of factors changes how they will increase and decrease, via a set of equations, or general principles.  It seemed that the connections were not quite accurate, and depended more on the government policies and the banks than was realized.  This was made clear in 2008, when the interaction of the banks and the insurance companies resulted in a serious crash.

Recently a whole lot of economists got into a huddle and produced, we are told, a set of fourteen papers, presented by Oxford University, called Rebuilding Economic Theory.  There are some basic ideas that we can understand vaguely, and I try to describe them below.

A major basic idea is to recognize every possible entity that affects economics: each consumer, each bank, each business, each stock, each economic policy decision, and so on, and consider them as sort of molecules in some container.  They are called agents.  This seems to borrow from the physics idea of statistical mechanics, which uses the individual motions of molecules to predict the gas laws, e.g. the behavior of pressure under temperature changes and compression.  We would have expected that this would be the obvious approach, but apparently they never got it right.

One theorist has pointed out four major problems with the way economists have been thinking, and he calls these The Four Horsemen of the Econocalypse.  The first is that the interaction between the agents cannot be simplified.  In physics, for example, we develop the gas laws by using a cubical box; then we divide the the molecules into exactly three equal groups, and assume that they go in three perpendicular directions, and then start using mathematics, and taking averages; a sequence of simplifications.  Anyhow, apparently the sort of simplification that they have been accustomed to doing will not work.  The second is that we cannot completely understand the world, just because new and unpredictable things are always happening.  The third is that the entire system will grow properties that the individual parts of the system do not have; for instance, even though individual drivers act in perfectly reasonable ways, their actions can add up to a traffic jam.  The fourth (and last, thank goodness) is that you can't use calculations that worked before, to solve the same problem when it happens again.  Assuming that this problem does not exist is called expecting ergodicity.  This is kind of obvious; people remember how things went the previous time, and opportunistically act in their own interest to take advantage.  If only people would behave like molecules, it would be a better world.  People are always figuring out the angles, such as buying stocks with their credit cards . . . have they no decency?

Some of the economists questioning the bases of economic theory and their methods point at the lack of insight into economics from other rational disciplines.  This has been my personal beef with it: I agree with these people, that economics has become more insular.  They point at the very small number of citations from other disciplines in economics journal articles (see chart at right).

Finally--and this is not going to give you much usable information; it just tells you what the recognized difficulties are--there is the notion of equilibrium, which is heavily used in physics, and even more heavily used, apparently, in economics.

For instance, suppose you take a sample of air, and then force it to occupy twice the volume.  (You have to imagine that it is in a piston, and then you pull the piston out to make the volume contained larger, which is a little counter-intuitive.)  What happens?  Of course you have to wait until the molecules of air stop fussing around and settle down, but this happens almost instantaneously.  Yes, the pressure is roughly halved.  But the point here is that we don't think twice about waiting until the molecules settle into a steady state.  Similarly with the water flowing down a stream: suppose the level upstream rises, and then stops rising.  For a while, while the stream waits for things to settle down, we notice only random sorts of things, and no real patterns.  Then, the situation starts settling into a steady pattern.  That's a quick outline of what we call equilibrium in physics.  In everyday parlance, equilibrium simply means balance; 'Please let me catch my breath, and regain my equilibrium!'  In physics, it means that the system has arrived at a steady state.

In economics, say these economical heretics, things actually never arrive at a steady state.  This throws the usual thinking of economists into a cocked hat.  Actually, a lot of economical argument I have heard is in terms of various things increasing and decreasing, which is definitely not a steady state picture, but, there is usually a background assumption of other things being equal.  This is all of a piece with that first unsimplifiability "horseman."

So, conventional economics is kind of broken.  But, as a particularly authoritative lady economist in the UK states, we are not trying to perfectly predict outcomes using economics; rather, we're trying to get some ballpark idea about how to respond to economic conditions just enough to avoid crises.  (Actually, this might not be what the woman said; I think I'm conflating a couple of different opinions from different people.)

But I expect that these economists will pretty soon come up with some approach in which they have great confidence.  Though I don't believe in the economic religion, I grudgingly admit that, however misguided they are, they are imaginative and clever fellows; their one major fault has, at least heretofore, been that they haven't taken advantage of ideas that originate from outside economics.  But I also know of the towering confidence in themselves that economists have, so it won't be long before we have a new approach from them, which will work well for at least a year.

Music of the Season!
I do not believe in Christmas in the sense that God yakkity yak blah blah.  Even my belief that Jesus was a historical figure is pushing the bounds of rationality.  But I have always enjoyed Christmas music and traditions, not because they make sense from a scientific point of view but because they are fun, and it doesn't make sense to reject something that makes for innocent fun.  (Bear in mind, though, that belief in Santa Claus in young children can pave the way for their adopting various other myths such as that ours is a government of the people, by the people, and for the people.  Haha.)

When I say Christmas Music, I used to mean the Baroque classics such as Handel's Messiah and Bach's and Schutz's Christmas Oratorios, or even The Infancy of Christ, by Berlioz, from which I am only familiar with a couple of pieces.  Add to these some well-established Christmas hymns, and that formed my musical world for Christmas.  But, over the years, I have absorbed a taste for Christmas music by various celebrities, such as Julie Andrews, Leontine Price, Robert Goulet, Paul Robeson, Marian Anderson, and so on.  Then, eventually, I also adopted crazy gag Christmas music, of which the authoritative collections came from Dr. Demento.  Then, finally, I have added choral groups such as Chanticleer, the King's Singers, and the Osmond Family.

The question is how to sequence these songs; they don't all do equally well if Tom Lehrer's Christmas Carol is juxtaposed with something from Schutz.  (I mean, they do, if you want to surprise yourself, but not otherwise.)  So my strategy is to listen to the pop versions early in the season, around December 1st, because my spouse despises Christmas music any earlier, and certainly at other times of the year.  Then I listen to collections of carols, from the Robert Shaw Chorale, and so forth.  Then come carols from King's College, Cambridge, and other serious carol collections, and finally Messiah and other classical Christmas works, and on Christmas Eve, medieval and Elizabethan carols.

This year, I broke with this orderly plan, and just put five CDs in my changer, which dates from around 2000, and have it playing in random mode.  The problem with this is that you can't resume from where you stopped, and I don't like to put the thing on pause when we have to leave the house.  Also, the spouse dislikes not being able to hear an entire disk, because we're always interrupting the music.  Still, there is no particular pattern to my listening.

Most alarmingly, I don't seem to listen to music very much anymore, because it involves actually walking to the music system, loading it, and turning it on, etc.  I love music, but I love indolence even more.

Silliness of Washington: no signs of settling down to a steady state
I hate to comment on what comes out of Washington, (I mean D.C., and not the westerly state that borders Oregon to the North), simply because I don't want to influence my readers' take on which matters to take seriously, just in case it is based on some disinformation from the White House.

I think it is safe to assume that the Trump Administration does not take seriously the need to be factual about either its information, or its reasoning.  We have to depend on the New York Times, the Washington Post, and other sources of news, which are fairly reliable.  We can take a peek at CNN occasionally, but unfortunately they resort to spin, which is not a good thing to do in these miserable times; it is hard to tell what is fact, and what is opinion.  NPR and PBS are a little more reliable, but their tone of objectivity has disappeared, and we're hearing some very partisan reports coming out of there.  Sometimes it is difficult to give an objective report, because at a higher order of reportage, background assumptions have to be factored in.  If the reporters suspect that there is deliberate intention to deceive on the part of the White House, especially since the President is under investigation, that suspicion, unfortunately, destroys the objectivity of the report in an essential way.

The general information we get is that the special prosecutor, Robert Mueller, has succeeded in completely destroying the credibility of the Trump Campaign, and hence the Trump White House.  In my mind, hiring Rudy Giuliani as his lawyer is tantamount to an admission of criminal activity, while also being an attempt to distract attention from himself, since Giuliani is such a caricature of a crooked lawyer.  Giuliani went so far as to admit that Trump would be allowed to testify under oath over his dead body, which in turn is to say that Trump cannot be depended upon to tell the truth, or even to not contradict himself.  This is a sad time for America, now that we realize that a White House that lies systematically creates a condition in which law cannot be effective.  Everybody knows now that if we want the law to be ineffective, all we need to do is to elect a President who lies all the time.  Or even some of the time.  I have some admiration for Bill Clinton, despite the embarrassment of the Kenneth Starr investigation.  That whole investigation was only intended to embarrass Clinton; Clinton was just too successful for the GOP to tolerate.  Here, the electoral process is at stake.  I believe that there was no foreign (i.e. Russian) interference with the actual mechanics of the election (but I could be persuaded otherwise).  But as the scale of the Russian propaganda onslaught through social media is revealed, we have to admit that it is of such a massive level that is criminal. Additionally, James Comey said that the FBI was concerned that the Trump indiscretions know to (and possibly arranged by) the Kremlin could have exposed Trump to the possibility of blackmail.  Again, this is another of the liabilities of electing a businessman to be President, especially a crooked businessman.

The Trump voting base had those who were sick and tired of the highly-educated Democrat elite that seemed to dominate Washington.  They were tired of environmentalists.  They were tired of what they perceived as self-righteous Politically Correct liberals, and were only too happy to troll them with rude statements.  They were sick of Feminists.  They were sick of the editorializing of the Press, which they perceived as Left-Leaning.  They were sick of the anti-pollution, and the Global Warming folks.  They thought they could live with a little lie or two from the White House, just to annoy the goody-goody Leftists, and the PC crowd.  They were tired of the concessions that the Democrats had granted to Iran, and they wanted lower gas prices.  And, of course, they hated the increasing power that Blacks, Hispanics and Immigrants were getting.  Apart from that, there was not a lot that those in the Trump Camp had in common.  Now, once the lying out of the White House grows beyond some unknown critical level, to the point where the Trump Camp itself can't quite believe what they hear, they begin to suspect that Trump and his friends are not just lying to the Democrats; they're lying to the Trump Camp as well.

The Democrats (and other left-leaning, intellectually unimpaired people) knew all along that Trump was lying.  Now the Trump Camp is in the process of learning at whom the lying was aimed.  Fooled me once: you know how it goes.

Looking at the election outcomes, anyone can draw their own conclusions why the Senate gained Republican seats, while the House gained Democrat seats.  Trump is persuasive in person, and on TV, on the campaign trail; that's Trump Camp enjoying Democrat-baiting.

Why the Democrats had so much success with the House is still not clear.  Why did the same people who elected Anti-Trump congressmen not elect Anti-Trump Senators?  One reason could be that they were in different states and areas; that's something that anyone who has access to the political maps can verify.  Even I, but indolence is a problem.  It can't be loyalty to a particular congressman, because such a large proportion of them are freshmen.

Anyway, let's brace ourselves for more silliness.  The Democrats are planning, using the familiar tactics of cornering committee seats and chairmanships, and all those strategies that are totally opaque to ordinary citizens.  Democrats have to work on a variety of fronts: effective functioning of the government which had previously gone berserk with Conservative objectives; restraint of the President, and oversight of questionable uses of Government power; and damage control.  Keeping a balance is going to be very, very hard.

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