Archive for the ‘Crony Capitalism’ Category.

“Urban Renewal” and The Kakistocracy


Adventures in Buffaloland – Episode 1 – Tim Tielman in Niagara Square, downtown Buffalo

Urban renewal was the lethal marriage of progressive urban engineering with what Tim [Tielman] calls the “kakistocracy“—thieves who justify their crimes against place in the canting and condescending language of efficiency and inevitability.

New York’s Senator Daniel Patrick Moynihan once said, while being driven through urban-renewal-decimated Auburn, New York, “In the 1950s, with a progressive government and newspaper, you got into urban renewal and destroyed everything of value in your town. If you’d had a reactionary newspaper and a grumpy mayor, you might still have it.” Try to imagine Chuck Schumer or Kirsten Gillibrand saying something one-ten-thousandth as perceptive. (Confirming Moynihan, the largest American city to reject urban renewal funding was Salt Lake City, whose voters, following the lead of their delightfully cranky libertarian Mayor J. Bracken Lee, rejected the federal bulldozer in 1965 by a vote of 29,119 to 4,900.)

Moynihan had a soft spot for Buffalo, probably because it was filled with the ethnic Catholics who claimed his heart, if not always his head. His support was critical in saving Louis Sullivan’s terra cotta-ornamented Guaranty Building (1896) from senseless demolition. (In a 1961 essay in Commentary, Moynihan called Buffalo “a big, ugly, turbulent city.” I once asked him if that description caused any problems in his campaigns. He looked at me incredulously. “How many people in Buffalo do you think read Commentary?”)

Tielman says, “Absent the federal and state money, none of this devastation occurs in Buffalo or Niagara Falls.” He elaborates: “Where did this free money go? To the existing power structure”—whose acts of destruction were facilitated, I regret to say, by urban Catholic mayors, who sacrificed significant portions of their cities to the Greatest Generation’s Greatest God: Progress.

. . .

[T]he Canal District [in Buffalo] is now threatened by every parent’s nightmare: a children’s museum, a $27 million project, jointly funded by a state development corporation and corporate donors, with the city offering a $1-a-year lease for forty years.

Tim is not enthusiastic. “Did you know Buffalo is the largest city in the country without a children’s museum?” he asks in mock outrage. “We can’t let that stand!” More seriously, he notes that “children’s museums attract fewer people than cemeteries,” and that this one “has nothing to do with the Canal District—it could be anywhere.” (It could be anywhere—what an apposite caption for so many of the edifices that deface our cities: This could be anywhere.)

. . .

Jane Jacobs occupies the catbird seat on Tim’s bookshelf. He rhapsodizes Jacobsian over pre-urban renewal Buffalo, which was “dense with buildings and crowded sidewalks, where one could wander block upon block, past shop after shop, restaurant after restaurant, office building after hotel, without apparent end. Buffalo was a beehive, where all of life’s necessities, pleasures, and luxuries could be had within the square mile of its core.”

Its demolition was not the work of some invisible hand or inscrutable force but rather, in Tielman’s phrase, “social engineers” who destroyed the essence of the city.

. . .

Next time you’re in Buffalo—and you really ought to visit; the Buffalos and Lowells and Pittsburghs are so much better for the soul than Orlando or Myrtle Beach—take one of the Campaign for Greater Buffalo‘s open-air bus tours.

The Real Buffalo Rises: How one American city lost, and then reclaimed its destiny.


Adventures in Buffaloland – Episode 2 – Tim Tielman visits two office buildings in Buffalo


Adventures in Buffaloland – Episode 4 – St. Paul’s Cathedral and Sullivan’s Guaranty Building<

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“Politics is unalloyed idiocy”

[O]ne of the reasons why I so thoroughly detest politics: it insults my intelligence. Even overlooking all of its many other faults, politics remains insufferable because it’s so completely imbecilic. It traffics in assertions that are either hilariously false or utterly meaningless. Politicians and their operatives then expect those of us on the receiving end of their moronic assertions not only to believe these assertions to be true, but also to marvel at the amazingness of the politicians who, we are assured, regularly perform the unbelievable feats described by the assertions.

Politics is unalloyed idiocy treated even by – indeed, especially by – the intelligentsia as if it is a solemn and serious undertaking. But it’s not. Politics is overwhelmingly the domain of megalomaniacal frauds, liars, and con artists.

Politics – Don Boudreaux

For too many, politics and the the state are their idols.

Statolatry. Ozymandias.

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“Tysons Corner, the Bubble Inside the Beltway Bubble”

Tysons [Corner, in McLean, VA] is an easy target for anger, with its combination of ostentatious wealth and its utter lack of coherent planning or design. It is the very archetype of ugly American sprawl: neither truly suburban, in which a leisurely drive or stroll down a sidewalk is at least in theory possible, nor truly urban, with all of the cheek-by-jowl rough-and-tumble life and character of a city. Tysons Corner instead consists of miles of grim concrete big-box stores, parking garages, flashy towers, garish office blocks, and decaying mid-century kitsch, all lining an expanse of 10-lane expressways that will kill you instantly if you crane your neck toward the dismal view for more than a second. It is the visual equivalent of putting a Beethoven symphony and a Metallica concert in a blender and piecing them back together at random.

But what should draw more attention is the fact that the greater Washington area now boasts one of the highest concentrations of wealth anywhere in the United States, much thanks to the ginormous federal bureaucracy and National Security State which has grown exponentially since the 9/11 attacks. As of 2015, fully half of the top 10 highest-income counties in the nation are in Maryland and Virginia, within an hour of the capital. There are probably as many Teslas in Fairfax County as there are in Silicon Valley.

None of this, of course, negates the reality that there is plenty of poverty, some of it desperate, right in the shadow of the U.S. Capitol. For example, there are the inner-ring suburbs of southern Maryland, largely decaying time-capsules of the 1950s which might be largely abandoned if not for people left behind by the 2008 financial crisis, low-wage workers who likely spend their days servicing their wealthy neighbors, and a deluge of poor immigrants, not all of them legal. These pockets of poverty only make the bloat and waste of the government—and its symbiosis with the sprawling, ever-increasing network of contractors, consultants, lawyers, and establishment media organs—more shameful. It is not as if these counties are rich through a roll of the dice: it is rather through what James Howard Kunstler calls “asset-stripping”—the matrix of financialization, offshoring, and an ever-increasing “Deep State” bureaucracy.

If the government should ever shrink, if the financial system should ever truly collapse, or if the military industrial complex stopped turning, this whole region would be depopulated. The “Alexandria” of The Walking Dead might prove prophetic. Without the steady flow of federal dollars, the 10-lane superhighways, luxury apartment towers, those kitschy mid-century diners, not to mention most of Loudoun and Clarke counties, would make Detroit look like a boomtown.

Tysons Corner, the Bubble Inside the Beltway Bubble

Ozymandias

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Resistance….

[W]hat bothers most Americans is politics now defined as nonstop sermonizing in which a rich athlete, a Pajama Boy activist, a demagogic politician, or a quarter-educated billionaire movie star lectures less fortunate Americans on the various deplorable racists, sexists, homophobes, and Islamophobes among them.

There is a populist and growing resistance to the Orwellian idea that free speech is hate speech, that equality of opportunity is defined only by equality of result, and that identity politics determines the degree of government-mandated penance and reparations.

Sometimes individual voices of this far-growing resistance movement write credos aimed at the Google-mandated reeducation seminars. Sometimes a few faculty members simply do not show up at their required university diversity-indoctrination workshops.

Sometimes, millions of viewers flip the channel when jocks at ESPN lecture as if they were wizened philosophers.

Sometimes when multimillionaire athletes claim victimhood and won’t stand for the national anthem, viewers of NFL games never view again. And sometimes they vote for flawed candidates like Donald Trump, whose virtue of saying almost anything to anyone at any time is considered a sort of harsh medicine that targets the malady of identity-driven political correctness, a chemotherapy to stop metastasizing malignancy.

This rather different resistance is tired of Warsaw Pact–like drabness in which, like dead souls, they must virtue-signal one reality while in their private minds resisting the groupthink. Cynicism abounds, as it always does in egalitarian utopias like the Soviet Union, Eastern Europe, Venezuela, or Cuba, because the Animal Farm commandments on the barn wall are pro forma, not reflections of revolutionary zeal.

The diversity trainers who contract with universities to profit from their captive audiences are in their second and third generations of treating self-created angst. Al Sharpton and Maxine Waters are about as radical as Amway sales people. The Southern Poverty Law Center issues “hate maps” that include Christian organizations — while it gins up millions of dollars in donations, some of which are offshored to Caribbean tax havens to ensure six-figure salaries to lawyers who can find few victims of hate and fewer hate groups to litigate against on behalf of the Southern impoverished.

Two Resistances

Many have made politics their idol. Politics is a false god. As is statolatry.

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Hunter-Gatherer Economics

In January 1488, Bartolomeu Dias, a Portuguese explorer, rounded Africa’s southern cape and put to shore to take on food and water. There he found a group, smaller and lighter-skinned than the other Africans he had encountered, who, mystified by the odd men appearing out of the infinity of the sea, chased them back to their boat under a hail of arrows.

The exchange, notes James Suzman in his new book “Affluence Without Abundance”, was a meeting of two distant branches of the human family tree: Europeans descended from ancient tribes that migrated out of Africa, and people commonly known as the San, who had called southern Africa home for at least 150,000 years. Just as important, the meeting represented the collision of humanity’s most ancient and durable form of economic organisation with its most powerful. The latter, wielded by Europeans, has dominated the half millennium since that scrape on the beach. But modern capitalist societies may have something to learn from the ways of their ancient forebears.

. . .

Life spent hunting and gathering, while occasionally trying, was not a tale of constant toil and privation. Food could run short during droughts or annual lean periods, but reliance on a broad range of food sources typically afforded such tribes a reliable, well-balanced diet. Even around the arid Kalahari food is plentiful (at least when the tribes are not forced to share the land with farmers and ranchers)—so much so that the typical adult need work less than 20 hours per week.

Living off the land: Hunter-gatherer economics

Affluence Without Abundance: The Disappearing World of the Bushmen,” by James Suzman

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A NY Example of DC Corruption and Cronyism

You sometimes hear of a Congressman who raises more money from New York state, or from the D.C. region than he raises from his home state, reflecting perhaps that he’s out of touch with the place he’s supposed to represent.

Congressman Chris Collins (R-NY), though, represents a district in the Empire State, which makes it more amazing that he’s raised more money so far this cycle from D.C., Maryland, and Virginia than he has raised from New York.

. . .

Collins’ ties to the drug industry are a lot more intimate than that, though. He is a very wealthy businessman (subsidies from the Export-Import Bank have helped), and recently his net worth got a boost thanks to a pharmaceutical stock in his portfolio, in an episode that highlights Collins’ tendency to blend policymaking, fundraising, and investing.

Collins is the No. 1 shareholder in Innate Immunotherapeutics, an Australian drugmaker. The Daily Beast reported that Collins has been close to the company since 2005 and joined the board in 2006.

Collins also played a major role in shaping the 21st Century Cures Act. According to various news reports, Collins inserted a provision into the late-2016 legislation that allowed a fast-track approval process for investigational drugs. This provision boosted Innate’s stock by helping bring Innate’s sole product, a Multiple Sclerosis drug called MIS416, to market more quickly.

Collins just happened to have bought up about a million dollars in Innate stock in August 2016, as the 21st Century Cures Act wended its way through Congress. This purchase was part of a special stock offering — a VIP opportunity into which Collins brought some friends. “Sixteen people with close ties to Collins bought Innate shares at discounted prices of $0.18 or $0.26 cents per share,” the Daily Beast reported in April. “Those investors have given nearly $42,000 to Collins’s political campaigns over the years, a review of campaign finance records found.”

This brings us back to his donor list.

. . .

Collins’ friends who bought discounted stock in 2016 would have paid around 25 or 34 cents per share, according to the New York Times. Shortly after the bill became law, the price skyrocketed, eventually to $1.77 per share in January. Shortly before that peak is when reporters overheard Collins talking on the phone saying, “Do you know how many millionaires I’ve made in Buffalo the past few months?”

Being a donor or friend of Chris Collins pays off.

Chris Collins, self-proclaimed millionaire-maker, wades into another drug lobby fight

Revolving Door Tax, Crony Capitalism, Ozymandias

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Credentialism and “Meritocracy” and Philosopher Kings


Does America Really Need More College Grads? – George Leef

The Chinese imperial bureaucracy was immensely powerful. Entrance was theoretically open to anyone, from any walk of society—as long as they could pass a very tough examination. The number of passes was tightly restricted to keep the bureaucracy at optimal size.

Passing the tests and becoming a “scholar official” was a ticket to a very good, very secure life. And there is something to like about a system like this … especially if you happen to be good at exams. Of course, once you gave the imperial bureaucracy a lot of power, and made entrance into said bureaucracy conditional on passing a tough exam, what you have is … a country run by people who think that being good at exams is the most important thing on earth. Sound familiar?

The people who pass these sorts of admissions tests are very clever. But they’re also, as time goes on, increasingly narrow. The way to pass a series of highly competitive exams is to focus every fiber of your being on learning what the authorities want, and giving it to them. To the extent that the “Tiger Mom” phenomenon is actually real, it’s arguably the cultural legacy of the Mandarin system.

That system produced many benefits, but some of those benefits were also costs. A single elite taking a single exam means a single way of thinking:

The examination system also served to maintain cultural unity and consensus on basic values. The uniformity of the content of the examinations meant that the local elite and ambitious would-be elite all across China were being indoctrinated with the same values.

All elites are good at rationalizing their eliteness, whether it’s meritocracy or “the divine right of kings.” The problem is the mandarin elite has some good arguments. They really are very bright and hardworking. It’s just that they’re also prone to be conformist, risk averse, obedient, and good at echoing the opinions of authority, because that is what this sort of examination system selects for.

. . .

[T]his ostensibly meritocratic system increasingly selects from those with enough wealth and connections to first, understand the system, and second, prepare the right credentials to enter it—as I believe it also did in Imperial China.

And like all elites, they believe that they not only rule because they can, but because they should. Even many quite left-wing folks do not fundamentally question the idea that the world should be run by highly verbal people who test well and turn their work in on time. They may think that machine operators should have more power and money in the workplace, and salesmen and accountants should have less. But if they think there’s anything wrong with the balance of power in the system we all live under, it is that clever mandarins do not have enough power to bend that system to their will. For the good of everyone else, of course. Not that they spend much time with everyone else, but they have excellent imaginations.

America’s New Mandarins – The paths to power and success are narrowing. So is the worldview of the powerful.

Statolatry

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Silicon Robber Barons

Silicon Valley’s power brokers want you to think they’re different. But they’re just average robber barons.

. . .

The press [i.e., clerisy] enjoys excitedly praising tech titans by comparing them to fantastical and mythical figures. Zuckerberg is Caesar. Elon Musk, a wizard. Peter Thiel, who believes that he lives in the moral universe of Lord of the Rings, is a vampire. I do not know if these men believe that they have the supernatural powers the media claims. Maybe they do. I do know that they do not mind the perception, or at least have done nothing to combat it, even among those critics who believe that they’re cartoon villains.

. . .

This might not be so bad if the phenomenon were limited to daft profiles by fawning magazine writers. But this Hegelian fan fiction is nowhere more potent than from the mouths of the Disruptors themselves. Mark Zuckerberg speaks in the voice of God. Shane Smith, by his own account, is the Stalin of Vice. Silicon Valley investor Carl Icahn was called “evil Captain Kirk” by fellow billionaire Marc Andreessen, before he was himself dubbed Dr. Evil by Rod Dreher, who has evidently not absorbed a cultural reference since 1999. When Elon Musk worries that Larry Page is hurtling toward AI without a sufficient appreciation of the risks, he calls it “summoning the demon.” Seamless CEO Jonathan Zabusky, a typical case, says his food delivery application for depressed millennials is “disrupting the paradigm” by showing people that “the era of the paper menu” is over. AirBnB’s mission statement laments “the mechanization and Industrial Revolution of the last century,” which “displaced” “feelings of trust and belonging”; their mission is to turn the world back into the “village” of simpler eras by encouraging longstanding residents of gentrifying areas to rent out their homes to monied travelers. Some firms are more modest: HubSpot, a marketing and sales platform, is merely on a mission to make the whole world “more inbound,” which is to say, more reliant on their blogging tips for small businesses.

. . .

Let us state the obvious: None of these men are Roman Emperors, and they haven’t got the wherewithal to “blow up” anything but a stock market bubble. They are not Lex Luthors or Gandalfs or Stalins. Their products do not bring about revolutions. They are simply robber barons, JP Morgans and Andrew Mellons in mediocre T-shirts. I have no doubt that many are preternaturally intelligent, hardworking people, and it is a shame that they have dedicated these talents to the mundane accumulation of capital. But there is nothing remarkable about these men. The Pirates of Silicon Valley do not have imperial ambitions. They have financial ones.

The vast majority of Silicon Valley startups, the sort that project lofty missions and managed improbably lucrative IPOs despite never having graced the cover of The Economist or the frontal cortex of the president, work precisely like any other kind of mundane sales operation in search of a product: Underpaid cold-callers receive low wages and less job security in exchange for a foosball table and the burden of growing a company as quickly as possible so that it can reach a liquidation event. Owners and investors get rich. Managers stay comfortable. The employees get hosed. None of this is particularly original. At least the real robber barons built the railroads.

Like all slim ranks of oligarchy, the Silicon Valley billionaires hate and fear nothing more than ordinary people. This manifests itself in mundane ways, in their open, cartoonish class spite (why, they ask, must Innovators in San Francisco be burdened by the existence of homeless riff-raff?); it is revealed in their most contemplative moments too. Peter Thiel has said that when the history of the 21st century is written, René Girard will be remembered as one of its greatest intellectuals. Girard is best known for the contention that all human desire is mimetic, that not only aesthetic taste but even hunger and lust are modeled on the desires of others. Perhaps this is why Thiel does not believe that capitalism and democracy are compatible. We know which side he’s chosen. So long as he and his fellows can continue to exploit that same mimetic tendency to persuade people that they are superhuman and essential to their flourishing, his side will continue to win.

. . .

If your enemies can convince you that they are an unprecedented species of madman, you will convince yourself that you need unprecedented weapons to fight back or that you may be better off just hiding in the forest. But you are not.

The rigged contracts and wage suppression, the racism and surveillance collusion (soon to be playing voluntary footsie with Donald Trump’s NSA, with further chicanery to follow), all these sins of Silicon Valley have come about and been overcome before in the short history of American capitalism. They require only the same weapons as before. Organization and agitation. Strikes and labor laws. The ordinary practice of radical politics. Some of these efforts have begun already, with militant organizing and unionization drives beginning to organize Silicon Valley laborers against their exploiters. But these movements require national and popular support, support that cannot begin until the pretense and terror of world-conquering wizards is abandoned and the truth is laid bare: These are only rich assholes, the same as they ever were. All that superman bullshit is just the cheap propaganda of the powerful, propaganda so thoroughly saturated in the American mind that its own inventors might believe it.

Valley of the Dolts

Moral preeners aided and abetted by the clerisy.

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Superman Politics

The Carrier bailout is awful, of course. It is a case of two politicians’ using public funds to bribe a business into doing things that benefit them personally and politically while creating no real long-term economic value. Pence, who dropped his free-market principles like the world’s hottest potato once he got within sniffing distance of presidential power, can burnish his populist credentials at the taxpayers’ expense, and Trump can get ready to flit on to the next publicity stunt.

But the emerging “Superman” politics here are truly poisonous. One of the genre conventions of superhero stories is the compression of all the world’s drama into the immediate presence of the hero — only his actions and intentions are relevant. People may be dying all over the world, but Superman saves Lois Lane. (Comic-book movies have lately subverted that convention by focusing on the collateral damage done by superheroes to the cities in which they live.) What that means in the context of our contemporary presidential politics is that no one takes any note of the fact that Carrier is not the only HVAC company in the United States or the only industrial concern in Indiana. Carrier has competitors that employ Americans, pay taxes, and produce real economic value, and they have been put at a relative disadvantage by the political favoritism extended to Carrier. What about them? They’re not on the stage, so they do not matter.

What is important to understand here is that this is not part of an economic-development agenda: It is theater. It is an adolescent fantasy of political power, and wherever Superman happens to land is where the action is. Nothing else is relevant. It does not matter that there is no broader logic at work: Small displays of efficacy can work to create an illusion of general efficacy. It is busyness as business.

. . .

Trump’s big idea so far is spending $7 million of other people’s money to delay an embarrassing headline. Some deal. Some deal-maker.

Trump’s Superman Style of Politics

Cronyism has a new moral preener and Crony Capitalist in Chief.

Ozymandias

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Ozymandias on the Potomac

Washington, [DC,] though, is something else. It is now the nation’s leading consumer per capita of fine wines, and while the price of housing there hasn’t quite hit Manhattan and San Francisco levels, it is among the nation’s most expensive, far outpacing expensive California locales such as Los Angeles and San Diego and almost anything between the coasts.

The District of Columbia, the wealthier precincts of which are disproportionately populated by young professionals not averse to taking the subway, is not an especially remarkable automotive market. But Virginia and Maryland, where those Millennial apparatchiks will move once they’re making real money, are fairly rarefied: One in five new vehicles sold in those states is from a luxury marque (about a third higher than the national average) with BMW leading the way, because D.C. is exactly that douchey, and Mercedes-Benz in second place. Aston-Martin is unusually popular in Virginia; Bentley sells unusually well in Maryland.

We know what drives California’s lifestyles of the rich and famous: technology, and for that we are grateful, which is why people admired Steve Jobs even though he was as much of a hard-assed capitalist as Henry Ford or J. P. Morgan. We know what drives New York City, too: finance, to no small degree, but also advertising, publishing, media, and fashion. Maybe you do not admire those industries as much as you do Silicon Valley’s technology innovators: Nobody says you have to, but those Wall Street jerks and book-peddlers and fashionistas do perform a useful — and, indeed, irreplaceable — role in the modern economy. Miami is doing well, too, and we know what drives that economy, too — the DEA is no doubt on the case. (Kidding! But not entirely kidding.) Houston has an economy that makes sense when you understand it, and so do Los Angeles, Chicago, and Denver.

What drives Washington?

One thing that drives the capital and its environs is those very large federal paychecks, which now amount to about $90,000 a year in money wages and just under $125,000 a year in total compensation. Washington pay has long been above the national average, but it is pulling away. In 2000, the median compensation for an American worker at large was about 74 percent of the median compensation for a federal employee; today, the average working taxpayer makes only 55 percent of what the average federal tax-eater makes. Our would-be class warriors talk about “transfers of wealth” and “transfers of income” when they mean mere changes in those metrics, but in this case, there is a literal transfer, with the most fearsome agency of the federal government — our corrupt and politicized IRS — raiding our households and businesses to support $1,000-a-night La Tur habits in Washington.

. . .

The problem is that if you add up everything legitimate Washington does in the way of keeping the peace, securing property, and enforcing contracts, you can account for — if you’re really generous – maybe 20 percent of federal spending, which is the real measure of federal activity. The rest is straight-up transfer of income and wealth from one political constituency to another and a whole lot of Harry Reid cowboy-poetry festivals and research involving getting monkeys high on cocaine. All that money sloshing through the pipes creates conditions where it is easy — and irresistible — to siphon a little off, legally and or otherwise. And that is why you see Hill staffers who put in ten years at modestly-paid jobs and then go to work at lobby shops that pay them enough to drive a Bentley and live in one of those horrifying weird $3 million suburban piles in Arlington.

Splendid Washington

Ozymandias

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