Economy Is People

A great demonstration of the fact that economy is people, from the 1920s:

On behalf of the pool, the pool manager, as broker, would begin buying and selling shares of the stock at frequent intervals, in no apparent pattern. Often he would buy and sell it back and forth among the members of the pool…..these essentially spurious transactions, accomplished with the sympathetic help of the specialist, would be so weighted that the price of the stock would begin to rise slightly. In speculators’ jargon, it would be “active and higher”…Thus the stock would be called to the public’s attention, and the notion of making a quick profit in it planted in the public’s mind. The eager tape-watchers would gradually begin to buy – cautiously and tentatively at first, then as the activity continued to increase and the price to rise, more and more boldly. Now the pool manager’s operations would become more delicate. On some days he would abruptly switch to the selling side, simply to create confusion; then just when the public was about to decide the picnic was over, he would come back in with a torrent of buying that would sweep all along with him. Finally, in a skillfully conducted manipulation, the thing would become self-sustaining; the public would in effect take the operation over, and in a frenzy of buying at higher and higher prices would push the stock on up and up with no help from the pool manager at all. That was the moment of the final phase….often spoken of indelicately as “pulling the plug.” With a mousiness in sharp contrast to the elaborate fanfare with which he had begun his buying, the pool manager would begin feeding stock back into the market. The price would respond by turning downward, gradually at first, then more rapidly as the pool manager’s trickle of sales mounted to a flood; and before the public could collect its senses, the retreat would have become a rout, the pool wold have unloaded its entire bundle profitably, and the public would be left holding the suddenly deflated stock….

Proof that fund managers are not in the business of manipulating dollars, they're in the business of manipulating people.

Another fantastic example of that (which actually extends the example above) is the profile Planet Money did on Proprietary Trading. The central contention there is that investment banks took money on behalf of people to invest in the market, and then used that money to help make their own investments do better, at the cost of the people who were investing their money through them.

I'm Speechless

Holy christ.

A Note On Economic Recovery And Theater

Isaac Butler (Parabasis) notes the role that the Federal Theater Project played in Federal Project Number One, the arts initiative.

The justification at the time, as I've mentioned before, is that when artists can be gainfully employed as artists, they don't take the jobs of unskilled laborers, and thus jobs are created.

Health Care Kerfuffle

An interesting thread of conversation came up between Ezra Klein, Andrew Sullivan, and Gershom Gorenberg about the merits and drawbacks of socialized healthcare.

One of the commenters in Ezra Klein's blog referred to the Andrew Sullivan post I linked to above and said that Andrew Sullivan was comparing "the US healthcare system as experienced by Andrew Sullivan to the UK healthcare system as experienced by Andrew Sullivan." To a certain extent, both Andrew Sullivan and Gershom Gorenberg are speaking about their own personal experiences, and how it has affected their opinions toward socialization of healthcare; Sullivan is responding to the UK, and Gorenberg is responding to Israel.

But in Sullivan's other post on the subject, he does point out that Ezra Klein's opinion polls aren't necessarily a better indicator of whether British-style healthcare is better for us than US-style medical industry (I refuse to call it "healthcare" but it is a medical industry). He's right that different countries respond to different systems differently.

But I disagree that Americans living under the NHS would have a revolution instantly. Certainly, I know many Americans who would be extremely frustrated with the healthcare system; that is because I know many people who can afford healthcare under the current system. But for those people who I know who can't afford the healthcare system, the choice between a nationalized healthcare system and no health care at all can't even really be called a choice. It was summed up for me when John McCain said, when asked about his skin cancer, that like most Americans he consulted with his oncologist about the issue. There are many Americans (I don't know if it's a majority or not) don't even have their own GP--they get a doctor when it is direly important, because they can't afford anything else.

But I do agree with you that the NHS is not what we should be looking for. In Ezra's post "The Canada/England Fallacy" he lays out a pretty good argument for not pursuing the British Model: because we shouldn't have a system that disallows those who can seek better health-care to do so. You, Andrew, probably have enough money to get better healthcare for your family than that which the NHS provided you. And so you should. But those who can't afford any healthcare at all--and whose privatized healthcare, if they could afford it, would probably treat them equally as poorly--should have something.

The state of postage in the United States (and other nations in the world) is similar. A government-run entity (USPS) is good for non-urgent mail, and can send registered mail and packages if you want it to. But other private companies (UPS and FedEx) compete with the government-run entity. If the USPS completely failed to provide any worthwhile service, it would eventually collapse--but I use the USPS all the time for letters, and for packages I tend to use UPS.

I'm aware of the pitfalls of socialized medicine. I was born in Israel, where my parents had lived for many years, and it has its own socialized medicine. My parents are ambivalent about socialized medicine; when they were young and poor, they got healthcare that they might not have gotten without its existence. But my oldest brother was born while my mother was not anaesthetized, because the nursing staff at the hospital attempted to give her the run-around because the anaesthesiologist had taken the day off. My grandfather had many troubles with his heart, and spending time waiting for cardiologists to have the time to address him was difficult.

Still, at the end of the day, this issue should be decided on economic models, on a more scientific approach to addressing what methods are most effective for the most amount of people. We want people with a lot of resources to have the best healthcare possible, and people with no resources to have the most healthcare possible. The top should be unfettered; the bottom should be supported.

"High-Value Professions"

Required reading from Ezra Klein:

Money Quote:

If you're in a high-value profession, hard work can do you a lot of good. If you're not, it may not do you any good at all. And though anyone can work hard, we're mostly able to admit that not everyone has the specific constellation of opportunities that lets you go to law school, or spend your time goofing off in amateur political punditry.

My response below (in his comments section)

Thank you! I've been struggling recently with my own chosen profession--theater--and getting increasingly angry at the fact that people who graduated, say, in the field of investment banking, will make money hand over fist.

I recently saw a statistic (it was quoted as being from the Bureau of Labor Statistics) that said that the median wage for actors in Actor's Equity Association (which not everyone can get into) is roughly $6,000.

$6,000. It's not as though we in the theater are doing something selfish--we raise property values, supplement education (not to mention the esoteric upside of things like cultural value). But we rarely turn a profit.

From a capitalistic point of view, our profession is a waste of time. The "entertainment" and "culture" slots are filled much more effectively by the internet, by the film industry, etc.

When I apply for a job outside of the theater (which obviously I have to, since I don't make anything from my theater yet), they don't look at my theater experience as being ANYTHING at all.

I've fulfilled the role of "stage MANAGER" but I could never be considered for a managerial role; I've led a team of artists on an independent project, raised funds, and controlled a budget. But what is the best job I can land in the quote unquote "real world"? I sold popcorn for Regal Entertainment.

So the question I'm saying that your question raises is, WHAT ARE THE HIGH VALUE PROFESSIONS. And why? Is a teacher not a high profile profession? Is Bill Kristol worth more to the news business than the arts reviewers, who are getting shed like flies? Are hedge-fund managers worth more to us than the much maligned "community organizers"?

A little context: Ezra Klein is a lucky guy, and also a talented guy. He's a political pundit. He's one of the few that I follow regularly, and I've very much enjoyed his status; I don't think it's ill deserved. And he has always used his powers for good--unlike Bill Kristol, who I took a shot at in the comment.

As you can tell, I've been a little irritated by this for a while, and it's kind of building. Because it's the assumption we all work under: only the true, true geniuses will break even--because someone wealthy will back us up.

I'm not bitter at Ezra, or at people who are successful in their fields. But when actors come to politicians for support, we get brushed off, as though we're some sort of luxury. I mean, theater is associated with wealth (because of the cost of high-end theater), but we in the theater business tend to be the poorest of poor. If you go to a Congressman and say, "will you help our small business?" or "Will you help our farmers?" they will at least pretend like they care. But theater? So far from their priority.

We are workers. We fight because we think this is a worthwhile industry; we benefit our communities. Why are we low value?