Post Brexit – The Curse of Democracy

Thoughts on why people need to earn their vote. This sounds oppressive and intolerant, but seriously…there should be a minimal level of competence before wielding a pen at the voting booth.

Troubling spike in Google searches related to the consequences of Brexit  – after the polls closed.

We know that democracy is the worst system – apart from all others. But we should try harder – shouldn’t we?

I mentioned Fukuyama’s End of History in my last post – I am still reading it so there will be more. The thesis is that History ends with liberal democracy as the system most able to deliver everything the heart desires. History ending does not mean history stops – just as finding the perfect diet does not mean life ends. It means, we can stop struggling to find the perfect diet and instead just exercise the will to stay with it.

Similarly with liberal democracy. It works. We just have to keep it intact. Why does it work? It works because it provides the optimum environment for the expression of our productive capabilities as human beings. And so, it allows us to create economic growth and wealth – the currency that allows us to sustain the other key ingredient that sustains our life as humans: recognition. Fukuyama draws on Hegel here to tell us something that seems obvious when we hear it: we seek recognition of our humanity, our equality, the worth of what we say and do, what we achieve. Everybody wants to feel heard.

Our Episcopelian baptismal covenant urges us to respect the dignity of every human being. So simple and self-evident.

And yet, recognition contains a little tension. We strive for recognition and that involves status. Status is relative and abilities are not equally distributed (life isn’t fair). So striving may end up with competition for recognition. Only one Steve Jobs, Elon Musk. We may have to live with a little inequality in our equilibrium. Multiculturalism celebrates the identity of a specific group and allows recognition to group members who previously have been ignored or suffered some form of social or political oppression. It may, however, erode the bonds of an integrated society. Tension.

The identity and group aspirations of EU members obviously contain tension. The means of resolving those tensions has apparently become too much for one of its members – hence Brexit.

Rejecting the broader goals of the EU group – or any group larger than an individual group member with a sub-group identity – is complex and dangerous. Groups such as the EU come together slowly, with consensus and mutuality. Independence is historically associated with independence from a previous oppression or conquest (think Commonwealth or Roman Empire, or Yugoslavia) – not as idiot, Nigel Farage, claimed, independence from the EU (freely entered into).

So, we have representative democracy, designed to provide a more deliberative process for making laws and policies, to avoid the process whereby direct democracies may succumb to passions and short-term considerations, ill-considered and manipulated by voices and influences motivated by unworthy goals.

Changing the US constitution requires a two thirds majority in House and Senate and ratification by three quarters of State Legislatures. Brexit required a simple majority. It didn’t have to be that way. Hence my sadness at the failure of leadership – a self-inflicted wound.

Participation of 100% all voting entities and individuals in a constitutional change would be virtually assured, so the super-majority provisions were designed to make it a very high bar. In the Brexit referendum, 72% of the population voted. So, 52% majority means that 37% of the population is causing the UK to withdraw. Democratic, as defined, but ill-conceived.

The continued success of liberal democracies requires considerable effort. Progress is not assured. The 19th century was an optimistic century full of promise for the advancement of mankind through science, technology and education. The 20th and 21st so far were and are less optimistic and contained many setbacks: wars, conflicts, Nazism, Communism, Totalitarianism, terrorism. How could Providence and a benevolent God survive the Holocaust (see earlier post on The New Atheism and one to come shortly, specifically on Providence)?

There is wisdom in crowds but danger in mobs. We live not so far from a very dark version of ourselves (imagine three days without electricity). People ‘get’ to vote when they reach the age of majority. (In the US, by the way, we seem to consider this something less momentous than acquiring the right to buy and consume alcohol…). Sometimes, though, we can become ‘drunk’ on democracy and suffer something similar to a hangover. As Kingsley Amis put it in Everyday Drinking, there is the physical hangover and also the metaphysical hangover – “that ineffable compound of depression, sadness (these two are not the same), anxiety, self-hatred, sense of failure and fear for the future”.

So, having needlessly handed a decision to an electorate that would probably have been happier without it, received an unexpected result, experienced ensuing trauma, one is left with the impression that we need some adults in the room to do what elected representative are supposed to do: calmly and deliberatively figure a way out of this mess.

It might be better if the men stepped aside for a while and stopped playing their university power games. Could we maybe have Angela Merkel and Theresa May work something out?





Brexit – Why Am I so Sad

Markets hate surprises. So do I. But markets will sort out their level in due course and the economic impact outside of Britain may not be as bad as today.

What bothers me is the social trends that led to this – they still exist. Left-behinds is the term. Those for whom capitalism over the last, say, 10 years has simply not delivered. They have no houses on the monopoly board, have not passed “Go”, did not pick up $200. Why not turn it over and storm out of the room?

Call it distrust of experts: politicians, economists. A feeling that banks and corporations no longer care about their employees.

The poor in England have increased by 64% from 1980 to 2010; the rich by 36% and the middle-class has declined by 26%.

In the US, the Federal Reserve conducts an annual survey to gauge economic health. It found 47% of Americans would either have to borrow, sell something or simply had no means of coming up with $400 to cover an emergency.

Existential questions of human rights, gender rights, fiscal union, EU free trade and movement of goods, the EU project of combining into a larger sovereign negotiating block, preventing the fractures and disputes that led to a millennium of wars and conflict do not matter if you are stressed about living paycheck to paycheck. Brecht said, in the Threepenny Opera, “First comes a full stomach, then comes ethics.”

Why am I sad? I am sad because the arc of history is supposed to bend towards progress: education and the advancement of knowledge should lead to better ideas, more productivity, better stewardship of our resources, better economic outcomes for more or the world’s population, more understanding, better relationships – international, national, group and individual. Sometimes it’s not so obvious it does.

A friend explained today his view of Brexit and the rise of Trump in the US as a repudiation of bureaucratic liberalism in favor of populism/nationalism. He concluded that, since people “hate having sanctimonious liberalism” rammed down their throat, they are prepared to make impulsive decisions to register their anger and frustration.”

Since 1980, non-financial corporations have returned an average of $376 billion per annum in dividends and share buybacks to the stock market. In the decade 2003-2012, the 449 companies in the S&P 500 Index in January 2013 that were public listed in 2003 expended 54% of net income ($2.4 trillion), on stock buybacks and another 37% of net income on dividends. That left 9% for new investment in productive capabilities (such as R&D), or profit sharing with employees through increased remuneration.

This financialization of the economy has been profoundly damaging, has led to an increase in debt capital and that has become associated with higher risks of cyclical financial shocks.

I am sad because I have not informed myself about this until recently. Have I been asleep?

I am sad because this is messy to fix. There is a wall of special interest money standing in the way of change. Maybe it takes the zealotry of an Elizabeth Warren to make this change.

I am sad because this is a world we are bequeathing to our children and we have not been good stewards.

I am sad because Brexit reminds me, sitting in the US, a dual US-UK citizen, that a democracy much older than the US, is struggling; that maybe, Fukuyama’s vision in the End of History  of the eventual global triumph of political and economic liberalism is not as certain as I would have liked.

It may be that the tendency of liberal democracies is to reach a point where the accommodation and recognition of the equal needs of all leads to a kind of impotence to act because meeting the interests of so many becomes too complex and too entangled.

It may also be that we are just on a bumpy patch and that the culprit is inequality – our failure to harness technology and innovation to increase the well being of all. If we can fix this, the vision will be restored.

Combatting inequality as we experience it today in America and Great Britain will require politicians of vision prepared to work together to achieve a common goal. Who are they?

And here is the final reason for Brexit sadness. I had thought the quality of leadership in Great Britain to be superior to that we are currently suffering in the US. Evidently not.

A sad day – at least for me.

At your age….

Standing on the 8th tee of a recent twilight golf event, Jimmy, a fireman six months from retirement , who has been caddying at the club for about 20 years, remarked that I was in good shape. That’s great. I thanked him and asked what he meant, not sure quite how he was able to get to this conclusion. Hey, he said, at your age, if you haven’t got a belly, you’re ahead of the game. Ahh!

I was immediately struck by the fact there could be some benefits to aging. Are we, on average, beginning to fall apart in our mid-fifties? Losing sight of our toes as we weigh ourselves; balancing the occasional attempt at physical exertion against the risk of a heart attack, torn ACL or other mileage-related physical ailment?

Look around you next time you go to Walmart. Review the number of diet emails that go into your spam folder. Look at the guys on the commercials – the kids on the commercials. Look at the parents carrying excess weight and the children with them. Are they genetic time bombs primed to go off in thirty years, or is this all avoidable?

I know this is a little obsessive. I agree. It’s one of the consequences of being a chubby kid, constantly feeling on the verge of gaining girth through lack of willpower or insufficient exercise. I know that some have a really hard time with weight; their best efforts sabotaged by a mysteriously slow metabolism. If you lose weight, you’re doomed to gain it back and more. Go paleo. Dump sugar. Avoid carbs. Peanuts only. Fruit and veg may not be as good as you think: hidden sugars; pesticides. It’s complicated.

Back to the benefits of aging. It’s not unreasonable to conclude that, if you’re focused on improving your overall fitness as you get into your 40s and 50s, you are going to have a huge advantage vs. your peer group. Go to your doctor and mention an ache or pain and dare to ask if there is anything you can do. Ehh! At your age, what do you expect. I am wondering why my knee gets a little swollen after two solid days of powder and bumps, some pickup basketball? Ehh. At your age, what do you expect? We could take a look, but honestly, what are we going to do? If you were in your twenties, maybe… This is not so original. Louis CK did a skit on this.

I am not sleeping so well. My IT band is tight. My lower back gets sore. My posture is bad. My hips are tight. My neck seems to be in a bad position. I feel tired when I wake up. Fill in the blank. Your mileage may differ. Injured myself at Pilates, Yoga, Crossfit.

So, for anyone that has an interest, my recommendation is a program called Turbulence Training or Home Workout Revolution. You can check out the whole background at and are the specific sites. There is a lot of video and written content for $47 per program. Great value. All levels. I have been using it for about 3 years. Probably feel in the best shape ever – this from someone who spent 25 years running 30-50 miles a week, frequently sidelined by overuse injuries. 30 minutes, 3 days per week. I admit, I fill in the days in between – I told you I was obsessive.

Thanks to Jimmy for this post.

How I learned to stop worrying and love the nominee

It is so difficult to get outside the echo chamber of partisan opinions. Everything you believe filters the information you seek out and digest. The Wall Street Journal; The New York Times; MSNBC; Fox; CNN.

Fox does not know where to go. The GOP nominee can’t help himself and continues down a path of racist, sexist, disability-mocking utterances, demonstrating with every appearance how unfit he is for public office. Hillary is criticized not only by the right but by the left also for her email, her foundation, her speeches to Wall Street, for daring to proclaim Lincoln her favorite President.

As someone who spent years nurturing the goal of citizenship being a means of one day voting against Hillary Clinton, I find myself in the position where I am learning to stop worrying about the past and support the only nominee that has a credible claim to be the next President of the United States.

Once you make this very simple choice and conclude that the Republican party has signed its own death warrant, the path is obvious – but it has some strange, though perhaps not surprising results.

In supporting Hillary, I begin to filter the news differently. I read yet another Wall Street Journal OpEd and sigh, wondering what the goal is of printing yet another anti-Hillary article. There is nothing new here. She is evil, corrupt, will say anything to get elected, has peddled influence, courted wall street for its money, wants to continue Obama’s policies, is shown lying for 13 straight minutes on youtube, sounds screechy, strident, can’t campaign, is not a natural politician, rose to nominee alongside her husband and not on her own, is entitled, is the worst candidate the party could have chosen, would have been beaten by anyone but Trump….

And yet, at 74, with all this history, having run in 2008 and lost, served under Obama, been sat in front of committees designed to pillory her on TV, she ran again and has the nomination. It turns out there was a worse choice – Bernie Sanders.

When you realize that the only viable choice is Hillary, you start to look for the positive – a Democratic voter in transition, so to speak. You stop resisting the logic of what she says because you don’t want to hear it and the voice annoys you. You give what she says the benefit of the doubt. You start to wonder where some of the very gender-specific criticisms come from. You start to think what you have actually seen and hear directly, rather than by hearsay. And you know for sure that knowledge of facts, policy and detail is far preferable to “it’s gonna be beautiful folks”.

There are second order effects also, though. I have recently been recommending a book, Makers & Takers by Rana Faroohar for its thoughtful analysis of a phenomenon called financialization – how the capital markets have lost their mission to provide capital to corporate America to facilitate long-term growth of businesses and jobs. Perhaps a more thoughtful exegesis of what the Occupy movement was instinctively highlighting and what Bernie Sanders was highlighting. The difference is that Faroohar nails it.

You begin to wonder if the current Republican party is capable of nominating anyone who would agree with Faroohar. Having worked in banking for a long time, it is obvious to me that banks and asset managers cannot be trusted to act in anyone’s interest but their own and that, absent clear rules, they will act badly. Voluminous legislation such as Dodd-Frank, though does not help. It just creates the opportunity for endless loophole-seeking lobbying.

This week in Dresden, the Bilderberg Meeting is taking place. It is an annual gathering of world leaders, executives, and assorted grandees, established in 1954 and named for the Dutch hotel where the secretive group first gathered. One of the agenda items is discussion about the “precariat”, a term popularized by British economist Guy Standing, describing a growing class of people who feel insecure in their jobs, communities, and life in general. They are…

…the perpetual part-timers, the minimum-wagers, the temporary foreign workers, the grey-market domestics paid in cash… the techno-impoverished whose piecemeal work has no office and no end, the seniors who struggle with dwindling benefits, the indigenous people who are kept outside, the single mothers without support, the cash labourers who have no savings, the generation for whom a pension and a retirement is neither available nor desired…

Ironically, this segment of society is somehow attracted to the populists such as Trump. Trump, though, does not have the answers. Does Hillary? I think she has the wherewithal to get there. Not sure, but sifting with a positive bias….