Monday, December 29, 2008

Vacation Notice

A Musing? is on vacation. See you soon!

Wednesday, December 24, 2008

The Information Age Revolution is a Bigger Deal than You Thought

The internet is revolutionizing economic production and human relations. I'm not sure that there has ever been one machine that has so clearly revolutionized both of these phenomena simultaneously.

That concurrence of phenomena is revolutionary in extraordinary ways. Information technology is therefore transforming not only how we view work and how we view relationships but also how we view the relationship between the two.

The relationship between work and human relationships is one of the central questions of history. Namely, how is productive activity helped or hindered by the impulse to connect with other human beings?

Information technology is beginning to make us optimistic about the economic potential inherent in cooperative, creative relationship. That optimism is politically profound in that it calls into question the paradigm of human society that focuses on the role of the ruler vis-รก-vis the ruled.

It is no coincidence that this reevaluation is happening at a time at which we can finally imagine that it is possible to care for the basic needs of all of humanity. Rather, that fact, the fact of plenty, affords us the comfort and confidence to re-imagine social relationships. At the same time, of course, information technology is partly responsible for the explosion of wealth that makes such a reality imaginable.

This revolution in social relationships has the potential to call forth an age of prosperity and peace that has been beyond our hopes. This is partly because information technology so clearly demands the mindset of cooperative thinking and so clearly highlights the potential inherent in the development of human capital.

Marx postulated that an age of cooperative production would be ushered in by the rise of the proletariat, the working classes. He did not, however, spend a great deal of time outlining the process by which the masses could prepare themselves to lead and organize society. His focus was on cooperation but not on the creative potential that has to be nourished to make cooperation worthwhile and productive. It is no surprise that Russia was never able to organize a society based on worker's empowerment: The workers were not sophisticated enough to run society. Inevitably, elites took over. Such elite control was inevitably, too, subject to corruption.

The rise of the paradigm of cooperative, creative production is at least as important as which class rules society. Information technology has highlighted, even to hardened capitalists and self-promoting entrepreneurs, the importance of developing human capital. This fact should not be dismissed with cynicism. Rather, it points to the forces of this age and should be seized upon accordingly.

Wednesday, December 10, 2008

Sovereign Wealth Funds

Sovereign Wealth Funds represent an attempt by states to benefit from markets but also have the potential to inject political considerations into macroeconomics. Is this inherently a bad thing? Free trade orthodoxy might say so. But, where is the bright line that distinguishes the familiar economic collective of individuals (i.e. the corporation) from the economic collective we call the state? In other words, will the time come at which free citizens endorse increased activity of such funds in the name of economic well-being? Will future citizens of the world look back and have difficulty understanding the distinction between capitalism and socialism?

Thursday, December 04, 2008

What Do Financial Markets Tell Us about Ourselves?

Financial markets are like the mirror of mankind, revealing every hour of every working day the way we value ourselves and the resources of the world around us.

It is not the fault of the mirror if it reflects our blemishes as clearly as our beauty.
(Niall Ferguson, The Ascent of Money)

What do you think the financial crisis is telling us?

Wednesday, December 03, 2008

Foreign Policy Prediction

Obama's cool veneer on foreign policy issues still hasn't been matched by a convincing agenda: "Be gentler and wiser." does not a strategy make, even when paired with a great deal of detailed knowledge.

I have enough confidence in Obama to believe that he is capable of coming around to a progressive, but realistic strategy. The question is: How much pain will intervene? Furthermore, foreign policy difficulties could be the specter that haunts the Obama administration: It all depends on Obama's learning curve and the pace of world events.

My prediction is that Obama will eventually come around to a global stabilization policy that rests on stronger concerted action between democracies. He could certainly accomplish this, if he wished to, while maintaining the least combative stance possible towards authoritarian regimes.

My instincts tell me that Obama's conciliatory nature, and Democratic biases, will lead him to favor gentle diplomacy with rogue regimes. I suspect that this will bear some fruit but that it will also encourage some destabilization: some nations will be encouraged by Obama's caution. The logic of democratic convergence will eventually make itself clear and Obama will be capable of discerning as much. Will it be too late for him? I hope and suspect not but cannot rule out the possibility.

Tuesday, December 02, 2008

Community Organizing in Government

Obama's background as a community organizer is showing itself in his governing style. Today, for instance, (1) I received an e-mail from the Obama camp with a video responding to the prolific community discussion on health care found on the website. The e-mail talked about the importance of transparency and engagement and still refers to Obama, at times, as "Barack." Very heimish (warm, friendly). (2) Additionally, Obama took the opportunity of his meeting today with the National Governor's Association to ask for their feedback about how to spend stimulus money:
The meeting with the governors was "unprecedented," said Gov. Edward Rendell (D) of Pennsylvania, in that it was the first time a transition team for an incoming administration reached out to state governors to ask their help in crafting a national agenda. Forty-three of 50 states are facing serious deficits.

It looks like we have our first "information age" president.

The Nation-State and Global Integration

A few questions about strains on the power and efficacy of the nation-state:

(a) Does the global financial crisis call for international management of, say, currency exchange rates?

(b) Do globalization and the near-global triumph of capitalism undermine the greatest incentive (namely, international competition, respectively, among capitalist powers and between capitalist and non-capitalist powers) for leading capitalists to attend to the well-being of those who are not succeeding?

(c) Do global warming and other environmental strains demand an internationally-coordinated response that cannot entirely be managed by one nation-state?

My answer to all of these questions is 'yes' and points to the growing importance of international cooperation to solve many of our most pressing problems. I am not arguing that states are not strong. Neither am I am arguing necessarily for inter-governmental cooperation to solve these problems (although, such will sometimes be vital). Rather, I am arguing that a global perspective is becoming of greater importance. In due time, I believe that such a perspective will become the dominant paradigm, superseding the nation-state paradigm.

It is no coincidence that this pattern of integration presents itself as we find ourselves in a world in which everyone can be lifted out of poverty and in which universal education can be imagined. These goals can be achieved because (a) the global economy is sufficiently integrated to distribute basic goods, services, and skills to those in need of them, (b) globalization and the near-triumph of capitalism have led to a global economy in which human capital is of ever-greater economic value, and (c) environmental challenges force us to focus on how we can develop wealth without solely relying on materials. The best answers to this question are the development of technology and of human capital.