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James S.A. Corey – Nemesis Games: The Expanse, Book 5

James S.A. Corey – Nemesis Games: The Expanse, Book.5

This book turns inward, as if in acknowledgement of each previous volume’s rapidly increasing scale and scope. After returning from their three-year journey to Ilus, and with the Rocinante in for several months of repairs, the crew members go their own ways for a while. This narrative device helps to develop the characters’ backstories, as well as show how different the social and political dynamics are on Earth, Mars, and in the Belt.

But with a colonization rush underway to the thousand new worlds reachable through the ring, each of the three governments are finding themselves increasingly irrelevant. Mars and Earth are both losing population, and the Belters’ very way of life is becoming obsolete—why live on a moon or a station when there are planets full of room with gravity, atmospheres, and real sunshine?

Suspicious events happening on each of the characters’ sojourns turn out to have common threads, climaxing in an extinction-level terrorist attack on Earth by a rogue Belter faction that kills billions. The Rocinante’s crew, after a series of individual adventures, reunites in haphazard fashion. The talk in chapter after chapter of how the crew have become each others’ family is overwrought to the point of annoyance, but the shoe fits. Roughly a decade has gone by in their lives since the beginning of the series. The characters are starting to get some gray hairs, they are often tired and weary, and have changed in ways they’ll never get back. About the only constant they’ve had is each other and the Rocinante.

Solar system politics have changed too, and like the characters, they can’t change back. The old days are gone. The book ends at this point, with everything set up for the big battle to come, presumably in volume 6 unless the authors find a way to milk this story arc for longer. As of this writing, The Expanse book series has 8 volumes. The 9th volume, due this year, is intended to be the finale.

Booth Tarkington – The Magnificent Ambersons

Booth Tarkington – The Magnificent Ambersons

This novel is about the multi-generation decline of a once-prominent family in early 20th-century Indianapolis. Despite Tarkington’s aristocratic demeanor and conservative politics, his most famous novel is highly critical of ancien régime old money, or at least its stunted American equivalent. The fictional Ambersons were something of the Kardashians of their day, wealthy and socially conspicuous, but not particularly accomplished.

The protagonist, the third generation of his family, is essentially a twit. He stands in stark contrast to his unrequited love interest, a sharp young woman who lacks his social pedigree, yet is more polished and restrained. She is also wealthy, but her father is a self-made man. Compared to the old money families, he is a little rough around the edges, and has little interest in fineries and showpieces. But he has integrity and a strong work ethic, which are far more important. The older Ambersons shun him and his daughter from their high society, apparently unaware of their opposite trajectories.

The Magnificent Ambersons pairs well with Charles Dickens’ Great Expectations not just for its disdain for aristocrats and snobbery, but for its positive portrayal of bourgeois virtues as entrepreneurship and humility. I also get the sense it was a source of inspiration for the movie The Royal Tenenbaums, though that movie, which I enjoyed very much, lacks Tarkington’s subtle positive message.

Robert Heinlein – Methuselah’s Children

Robert Heinlein – Methuselah’s Children

This novel introduces Lazarus Long, a long-lived character who appears in several Heinlein’s novels. He is a colorful character, full of earthy epigrams and a knack for getting into and out of trouble. Long’s appeal is more the fun of going along on a crazy ride than anything else. His anti-authoritarian ethos has a lot to say for it, though he is often too impulsive and, as with most of Heinlein’s books, too brashly masculine for his own good.

James S.A. Corey – Cibola Burn: The Expanse, Book 4

James S.A. Corey – Cibola Burn: The Expanse, Book 4

Things settle down for a few years after the big battle inside the ring. The massive warship The Behemoth has been converted to a peaceful station inside the ring for ships venturing back and forth through the 1,300 or so smaller ring gates to other star systems. Some stranded Belters have even established a small colony on a habitable planet on the other side of one ring gate, which the colonists have named Ilus. But then a conflict brews between them and an Earth-based mining company which is also seeking to establish a presence on the planet, which they call New Terra. A radicalized faction of the colonists bombed a landing pad, which resulted in a mining shuttle craft crash with fatalities, including several scientists unaffiliated with the mining company. James Holden and the Rocinante crew have developed a reputation as impartial peacekeepers at this point, and they’re sent in as part of a mediation team to try to prevent further violence.

The problems end up being far deeper. In addition to violence from multiple factions echoing the Earth-Mars-Belt disputes from earlier books, two-billion year old structures on the planet are accidentally revived, resulting in a planetary disaster. Orbiting ships are unable to help, and end up fighting each other, resulting in two simultaneous battles with shifting alliances, one on the planet Ilus/New Terra. As with the last book, disaster piles on disaster until conditions are so bleak that there seems to be no way out. That said, there is a Book 5 in the series, so one can guess how the ending goes.

This Week in Ridiculous Regulations

President Trump threatened a new tariff on all Mexican goods, potentially scuttling the NAFTA/USMCA agreement. My colleague Wayne Crews went through the new Spring 2019 Unified Agenda and found 3,791 new regulations in the pipeline, and the 2019 Federal Register surpassed 25,000 pages. Meanwhile, during a four-day week due to Memorial Day, rulemaking agencies published new regulations ranging from anchovies to inertia locking devices.

On to the data:

  • Last week, 41 new final regulations were published in the Federal Register, after 77 the previous week.
  • That’s the equivalent of a new regulation every 4 hours and 6 minutes.
  • Federal agencies have issued 1,098 final regulations in 2019. At that pace, there will be 2,615 new final regulations. Last year’s total was 3,367 regulations.
  • Last week, agencies published 347 notices, for a total of 8,962 in 2019. At that pace, there will be 21,339 new notices this year. Last year’s total was 22,205.
  • Last week, 1,128 new pages were added to the Federal Register, after 1,668 pages the previous week.
  • The 2019 Federal Register totals 25,492 pages. It is on pace for 60,696 pages. The 2018 total was 68,082 pages. The all-time record adjusted page count (which subtracts skips, jumps, and blank pages) is 96,994, set in 2016.
  • Rules are called “economically significant” if they have costs of $100 million or more in a given year. One such rule has been published this year. Six such rules were published in 2018.
  • The running compliance cost tally for 2019’s economically significant regulations currently ranges from $139.1 million to $175.8 million. The 2018 total ranges from $220.1 million to $2.54 billion, depending on discount rates and other assumptions.
  • Agencies have published 29 final rules meeting the broader definition of “significant” so far this year. 2018’s total was 108 significant final rules.
  • So far in 2019, 195 new rules affect small businesses; 11 of them are classified as significant. 2018’s totals were 660 rules affecting small businesses, with 29 of them significant.

Highlights from last week’s new final regulations:

For more data, see the study “Ten Thousand Commandments” and follow @10KC and @RegoftheDay on Twitter.

Gabriel García Márquez on Partisanship

Times and places change, but much else stays the same. From pp. 241-242 of Gabriel García Márquez’s 1967 novel One Hundred Years of Solitude:

“The only difference today between Liberals and Conservatives is that Liberals go to mass at five o’clock and Conservatives at eight.”

Addressing the Gender Pay Gap: Culture, Not Legislation

A recent Washington Times article quotes me on Democratic presidential candidate Sen. Kamala Harris’s plan to address the gender pay gap. I could have given better quotes, frankly, but it’s difficult to treat a complicated issue with nuance in a couple of short sentences. Conservatives and progressives both make some good points, but ultimately fall short of addressing the issue constructively:

  1. Conservatives often downplay gender discrimination or deny that it is a problem. This is wrong.
  2. Progressives are right that discrimination is a problem, but with the pay gap, they are prioritizing the wrong facet of the problem.
  3. There is a culture gap, far more than a pay gap. Most politicians put the pay gap at 77 or 79 cents on the dollar. One ideologically motivated study puts it at 49 cents. These figures do not account for the fact that women are more likely than men to work part time or not at all for extended periods to provide child care or other family needs. Men who do the same thing are subject to a similar wage lag. In another comparison, Bureau of Labor Statistics data show a wage gap of six cents for women who have never married—which says more about cultural gender norms than about different pay for equal work. Men and women also often cluster in different occupations, which have different pay. Occupations such as kindergarten teachers and construction have heavy gender disparities, as well as different pay—often in men’s favor. Again, the causes for this are often cultural, not due to different pay for equal work. The pay gap is almost certainly not a myth, but it is almost certainly a smaller problem than many people believe.
  4. Focusing so intently on the pay gap has an opportunity cost: More important gender discrimination issues are being crowded out from popular attention. In the workplace, these issues are as serious as rape and sexual harassment. They also include cultural pressures against women making their own life choices. Different people have different preferences on working vs. staying home. Many people on both sides of the culture wars still don’t respect that. Gender discrimination also includes everyday rudeness, such as men being more likely to interrupt women in conversation, taking their ideas less seriously, or judging them on appearance and demeanor rather than merit. The list is long, and the combined effects are large.
  5. One reason for the undue attention to the pay gap is that wages are easy to measure, while “soft” discrimination is often difficult or impossible to measure. It’s an example of what economist Jerry Z. Muller calls The Tyranny of Metrics. People tend to focus on what they can measure, and ignore what they can’t.
  6. Not only is attention being focused on the wrong issue, but many progressives are only offering one tool, poorly chosen: legislation.
  7. Pay gap legislation is prone to unintended consequences, such as businesses hiring fewer women. This is not what anyone intends. But it would be the easiest way for a company to avoid compliance headaches, potential lawsuits, or as in Sen. Harris’s proposal, a tax increase. This easily predictable effect works against everyone’s shared goal.
  8. Addressing gender discrimination requires cultural change from the bottom up, not top-down legislation. Politicians’ limited vocabulary is hurting progress on a real problem.
  9. Convincing millions of  individuals over time to be more thoughtful to others is a slow, uneven process. It will also likely never end; civilization is not humankind’s natural state.
  10. The cultural change argument is aesthetically unsatisfying. It can’t be planned, controlled, or quantified, even when possible improvements are clear as day, as with gender discrimination. It is a long-term process, not a short-term result. Advocating for cultural progress just looks flat compared to more immediate offerings such as taxes, fines, or quotas.
  11. Emotionally, it is much more fulfilling to hear a fast, simple, and concrete solution at a candidate’s press conference. It gives people something tangible with a face and a name they can rally around. This is in tune with how the human brain works. It gives us an in-group to affirm and an out-group to vilify. A story with a hero and a villain makes for a more interesting story than personal reflection.
  12. In addition to the endorphin rush it provides, signaling support of a bill is far less work than a lifelong effort to treat people well.
  13. The measurement problem, the cultural change argument’s lack of charisma compared to magic bullet legislation, the abstract nature of culture, the difficulty for ongoing individual effort, our own brain chemistry, and the long-term nature of change all contribute to why people’s everyday cultural values aren’t discussed as much as they could be.
  14. Astute readers might notice that economic historian Deirdre McCloskey says similar things about cultural change and the origins of modern mass prosperity, which extends beyond one’s bank account to include the arts, life expectancy, political inclusion, technology, travel, family life, and more. Caring about gender discrimination and fighting against it is another important aspect of the larger classical liberal project.
  15. Gender discrimination is a complex problem with a complex solution. But then, Rome wasn’t built in a day.

Trump Threatens up to 25 Percent Tariff on Mexican Goods, Jeopardizes NAFTA/USMCA

Things have been moving quickly on President Trump’s top legislative priority, the NAFTA/USMCA trade agreement. The key was rescinding steel and aluminum tariffs against Canada and Mexico. On Wednesday, Canadian Prime Minister Justin Trudeau moved to introduce the agreement to Canada’s legislature for ratification, prompting a Thursday visit from Vice President Mike Pence. Also on Thursday, Mexican President Andres Manuel Lopez Obrador introduced NAFTA/USMCA in Mexico’s Senate. He is requesting that the body, on recess until September, hold a special session to ratify it.

Within hours of Lopez Obrador’s announcement, President Trump may have torpedoed his own agreement. Shortly after markets closed, he threatened, via Twitter, a new tariff against Mexico that would dwarf the steel and aluminum tariffs:

1/2: On June 10th, the United States will impose a 5% Tariff on all goods coming into our Country from Mexico, until such time as illegal migrants coming through Mexico, and into our Country, STOP. The Tariff will gradually increase until the Illegal Immigration problem is remedied,..

2/2:….at which time the Tariffs will be removed. Details from the White House to follow.

On July 1, the 5 percent tariff would rise to 10 percent. It would then rise by an additional 5 percent at the beginning of each month until reaching 25 percent on October 1. It would remain there until President Trump is satisfied with Mexico’s immigration policies. He did not set specific criteria for Mexico to meet. And as mentioned earlier, Mexico’s Senate is out of session until September. But the administration’s statement indicates that this threat isn’t entirely about immigration (capitalization of “tariff” and typewriter-era extra spacing between sentences in original):

If Mexico fails to act, Tariffs will remain at the high level, and companies located in Mexico may start moving back to the United States to make their products and goods.  Companies that relocate to the United States will not pay the Tariffs or be affected in any way.

By way of context, this tariff would be nearly twice as large as the recent 25 percent tariff on $200 billion of Chinese goods. Mexico annually exports roughly $346.5 billion of goods to the United States.

NAFTA and the NAFTA 2.0/USMCA both require near-zero tariffs among the three member countries. Trump has invoked the Jimmy Carter-era 1977 International Emergency Economic Powers Act as legal authority for the tariffs, claiming that that bill’s emergency powers supersede possible NAFTA violations.

As I’ve mentioned before, Trump has a habit of using dramatic last-minute threats as a negotiating tactic. Sometimes he follows through, as with the recent 25 percent tariff on $200 billion of Chinese goods. Sometimes he withdraws, as he did with a threat to close the entire U.S.-Mexican border, and an April threat of a 25 percent tariff on Mexican-assembled automobiles—which are often made largely of U.S.-made parts.

For obvious reasons, a new tariff against Mexico will not make its government more likely to ratify NAFTA/USMCA. Tariffs are usually met with retaliatory tariffs, not the policy action Trump wants. The U.S. economy is risking yet another instance of double damage from President Trump’s announcement—once from his tariffs, and again from retaliatory tariffs.

Further complicating matters, Mexican President Lopez Obrador largely shares Trump’s negative view of free trade. His support of NAFTA/USMCA is not deeply held. His going along with the agreement is largely a kindness to his predecessor, Enrique Peña-Nieto, who negotiated the agreement and signed it on his final day in office. Lopez Obrador’s NAFTA/USMCA support is easily lost, and this tariff gives him an easy out.

The tariff also complicates matters in America. Also on Thursday, President Trump issued a Statement of Administrative Action. This opens a 30-day waiting period, after which Trump can send NAFTA/USMCA to Congress at any time for a mandatory ratification vote within a set period (Politico has a handy timeline). Members from both parties opposed the steel and aluminum tariffs, and they will likely oppose the new tariff, which is potentially much larger. If Congress is required to vote, it may well vote no due to the new Mexico tariffs.

Democrats already hold the upper hand in negotiations due to the administration’s high prioritization of a low-stakes agreement; USMCA contains no major changes to trade policy. Even without Trump’s tariff threat, they could hold up the agreement to add trade-unrelated provisions to benefit favored labor and environmental constituencies. Or they could condition ratification on a more important matter, such as must-pass appropriations bills or other Democratic policy priorities such as health care or the minimum wage.

A new tariff is Trump giving Democrats free ammunition to hold up not just NAFTA/USMCA, but other administration priorities as well.

We’ll find out by June 10th if Trump walks back a major economic and political mistake, or goes through with it.

Ron Chernow – Titan: The Life of John D. Rockefeller, Sr.

Ron Chernow – Titan: The Life of John D. Rockefeller, Sr.

I read this as part of my recent research on antitrust regulation; Rockefeller’s Standard Oil remains a touchstone case in the field. Chernow does a good job of portraying Rockefeller as neither devil nor saint. Just as people today get hyper-emotional about billionaires such as Bill Gates or Jeff Bezos, Rockefeller was a hotly divisive figure in his day. His detractors bordered on the obsessive, especially Ida Tarbell, who comes across as apoplectic as Koch and Soros obsessives do today.

Rockefeller’s father was a quack doctor selling natural remedies who left his family for months at a time, and turned out to be a bigamist. Rockefeller was his father’s opposite in almost every way, except for their shared insistence on always paying their debts on time. He also had his credulous side, believing in homeopathy and other quack remedies. He retained a strict Baptist faith for his entire life, which left him with a rather narrow mind—though this didn’t stop him from having a case of wandering hands in his old age that was creepy even by the standards of the time.

On the other hand, Rockefeller always tithed, both before and after he made his fortune, and had great concern for charity and the poor. Despite his wealth, he does not come off as a greedy man. He didn’t seem to enjoy money so much as putting in the required work to make money, and succeeding at it. He also played a large role in the founding of the University of Chicago, whose famous economics department would likely have appalled Rockefeller, who was a trade protectionist and favored a managed cartel economic system that was in vogue during the Progressive Era.

Chernow’s focus is more on the man than the company, but Standard Oil is entwined enough with Rockefeller that the reader sees just how quickly the company grew, and how it became a popular lightning rod. The ongoing controversy over Standard Oil’s discounted rail shipping rates comes off as just plain dumb, just as the controversy over tying web browsers into operating systems was in the Microsoft antitrust case a century later. Chernow is no free-market ideologue, but the fact that Standard Oil continued to reduce prices and expand output reveal how tenuous its dominant market share—as is the fact that it nearly collapsed as electric lights displaced kerosene lamps. If the automobile hadn’t emerged around this time, and Standard hadn’t been clever enough to pivot to gasoline and lubricants and away from kerosene, the big 1911 antitrust suit would likely never have happened. Monopolies cannot last without government help—though Rockefeller is not entirely blameless on this front.

Rockefeller’s long life also allows Chernow to treat the Rockefeller children and grandchildren in some detail, and as with any family, they were a varied lot. Some shared his business acumen. Some tried but weren’t quite up to the task. Grandson Nelson became New York governor and Gerald Ford’s vice president. Daughter Edith took to a bohemian lifestyle, and even fell in the psychoanalyst Carl Jung’s circle, which ended up being quite expensive, and more than a little scandalous.

Frank Dikötter – The Cultural Revolution: A People’s History, 1962—1976

Frank Dikötter – The Cultural Revolution: A People’s History, 1962—1976

Part of Dikötter‘s trilogy on Maoist China, with the other volumes covering the Revolution and the Great Leap Forward. The Great Leap Forward (1958-1962) caused millions of deaths from starvation, and its attempt at industrialization failed. Rather than admit defeat, Mao decided to double down, and began the Cultural Revolution just four years after the Great Leap Forward ended. In some ways, Dikötter argues, the Cultural Revolution was a continuation rather than a distinct event.

It formally lasted for a decade until Mao’s 1976 death, though by then it had tapered off somewhat. This second push went only marginally better than the first. It also dismantled China’s higher education system, leaving an entire generation essentially with almost no college graduates—at least from domestic universities. China’s university system is still stunted, with professors afraid to do anything that might be considered politically our of line. This has had predictable effects on subsequent generations’ entrepreneurship, political diversity, and cultural output such as literature and film.