Saturday, March 11, 2017
Monday, March 6, 2017
I have entered my 70th year. I cannot even remember ever anticipating getting this old. I remember thinking about 60, yes, but, that was so far away. Inside I am still 30.
The way my life has unfolded bears a tenuous resemblance to the way I imagined it unfolding. I wanted to be an economist, to teach and write, and I have achieved that in a way I could never have imagined, gaining some real-world business experience along the way. And if things had continued the way they are now, I would have been more than happy. Who would have thought that this year will be my busiest for quite a while - conferences, seminars, book project, an exciting institutional project, and more articles to add to the uptick in recent years (thanks to my young colleague Nicolas Cachanosky for a lot of this).
Add to this many family blessings and I conclude that I am the richest man alive.
Monday, February 20, 2017
Musings on the mysteries of mortality.
- It is a short ride really
- Upon entering the house of a close friend who has recently died at a young age - your age. You know he is gone, but the unconscious mind still uncontrollably “expects” see him sitting where you last spoke – his eyes, his expression, the timber of this voice, his special sense of humor, all as they ever were – it cannot accept the notion that all that he was has now somehow suddenly stopped – he has not left the room – he is gone forever. Sadness and frustration overwhelm you.
- 50 year high school reunion. You show up expecting to see your classmates and all you find there are old men and women.
Saturday, February 11, 2017
The two issues I identified in my early evaluation of the prospects for the Trump administration also seem to be the most polarizing. I refer to immigration and trade. Educational reform runs a close third. I discuss them in reverse order.
I believe education is the one with most potential for rapid and large benefits. The federal government plays only a minor role in public education, but, if owing to the change in philosophy at the top, one or two states adopt a state-wide voucher program, the dam protecting the public school monopoly will burst (this is Milton Friedman’s metaphor). In very short order, a flurry of entrepreneurial activity will enter the K-12 education industry and parental energy will be mobilized in the interests of their kids. Within a few years a variety of better options for American school-children will be routine. I expect vigorous opposition at every turn, highlighting everything that even smells vaguely like a mistake, suggesting that the less than perfect condemns the better, as if it could be any worse for kids in the inner city than it is now. But the benefits will be huge and not only for the children via better education and earning opportunities, but also for their families and for the whole country, to put America back into the community of nations with high levels of proficiency across the board. Dare one hope?
On the matter of trade, it seems to me unambiguous. Restricting trade that is peaceful is uniformly a very bad idea. Trade is the engine of growth. We should never restrict trade to make something at home that we can import at five times less the cost - as with Mexico. One would think that any successful businessman would know that. How much of this is posturing for political purposes and how much trade and international investment in the U.S. and by U.S. companies abroad will actually be affected, remains to be seen. Again fingers crossed.
So to the matter of immigration. This is by far the most difficult issue and the one I feel most confused and sometimes isolated about. Movement of people across borders is, of course, related to movement of goods and services, and investments, across borders. In general this is an unambiguously good thing – a win-win situation – though of course those whose wages are protected by the absence of low-wage immigrant workers could be hurt. I believe, in the case of Mexican immigration, the number of losers and the extent of the losses are very small, because Mexican labor is complementary to, not competitive with, workers already here. More than thirteen million illegal workers do jobs that the rest of us are very happy to have them do. I cannot see that illegal immigration of this kind hurts anyone. It saddens me greatly to read in the Dallas Morning News this morning of the rounding up of hundreds of undocumented people for deportation. Who gains from this deportation? It diminishes us all. (And this is not new with Trump. Obama was a big deporter of illegals.)
Whatever violence is associated with this immigration is most likely connected to the drug trade. It is not an immigration problem, it is a drug-enforcement problem. The best way to deal with that is to decriminalize the drug-trade. The drug-war cannot be won. Time to abandon it. And immigration on our southern border is simply not a problem, it is an opportunity, an opportunity to turn an apartheid situation into a integrated labor market with extensive immigration reform. The last thing we need is a wall.
But there is a difference between movement of things and movement of people across borders. People bring attitudes and intentions with them, they can get sick, they can die, they are animate. It cannot be denied that not all immigrants are alike in this regard. As I see it, there are two problem sub-cases connected to immigration, dependency and danger.
Dependency - it cannot be denied that when people attempt to cross borders out of extreme need, desperation, into a welfare state where those with resources are forced to share those resources with the immigrants a serious moral dilemma exists. This is a really problematic second-best situation. It is fundamentally a problem of the welfare-system itself. But, given the existence of automatic mechanisms to force some to pay for the needs of others, a large influx of needy people could spell economic ruin. And, even if such mechanisms are altered to deny immigrants welfare assistance, the potential exists that the large numbers of immigrants may arrive anyway and constitute a humanitarian crisis beyond the capacity or willingness of private individuals to deal with – as we saw in Greece, Hungary, and other places recently as a result of the Syrian refugee crisis. Who can blame a population for collectively trying to respond to this by setting up some sort of barriers? The origin of the tragedy lies not with them but with the chaos in Syria. There are no simple answers in this kind of situation.
Danger – by the same token it cannot be denied that there are people in the world who are committed to the destruction of everything we hold dear. It cannot be denied that these people are dangerous. So the risks associated with allowing such people to immigrate may be real and one cannot fault an attempt to assess and deal with this risk. My condemnation and alarm at the recent travel ban imposed by Trump is not that this danger does not exist, but that, at the present moment, in America, it actually is not very great, and that danger will not likely be decreased by the kind of shot-gun approach of an across the board ban that affects all Muslims (including students and green-card holders and refugees) from those selected states. True they are states that sponsor terrorism, and for that reason greater scrutiny is already applied to people coming from there, directly or, more likely, indirectly. The harm done to innocent people by this ban is simply not justified.
Perhaps one of the most appealing aspects of candidate Trump was his refusal to be politically correct. I imagine many people voted for him because they were just fed up with the patronizing, whining refusal of the Progressives, personified most visibly by Barak Obama, the refusal to confront simple realities for fear of offending people; specifically to confront the issue of radical Islam, calling it by name, and examining its connection to Islam more generally. No one was served by this condescendingly evasive attitude, and, in fact, it probably played a large part in the election of Donald Trump. So when thinking about Muslim immigration, one should, for example, confront the reality that now exists in France, with its lawless Muslim ghettos openly radical and hostile to the very nation that took them in. Surely it is legitimate to ask, what did they do wrong, and what are the chances that we could suffer the same fate? What makes us different enough to believe that it will end better here?
I actually do think we are different and that it would end better here. I look at the large Muslim population we have already and how integrated they are into American life, not poor, isolated and hostile, especially the next generation. But the conversation is certainly worth having. If I am right, what explains the difference?
And the conversation is worth having undeniably because of the very nature of Islam itself. There are problems there. If we don’t talk about them the dangers of Islamophobia are greater. I think many Muslims understand this. Many non-Muslims need to be reassured.
As a world-view – according to its law-codes – Islam strikes most Americans (and “westerners”) as terribly problematic. Despite deflections by its apologists, it is full of violent, misogynistic, deeply anti-individualistic ideas and commands, and overt anti-Semitism. And the radical version of this accentuates those very elements that we find repugnant and ignores those we find reassuring. The very problematic nature of Islam as a set of doctrines needs to be counterpoised to the reality that Muslims in America do not seem to abide by them – though polls show that, worldwide, most Muslims affirm them. In North America, the vast majority of Muslims, in spite of the severe law codes of their religion, are peaceful and, in varying degrees, open to assimilating western ideas. The everyday lives of moderate Muslims when they work and play and pray, do not make the news. There is very little intellectual activity of a theological nature grappling with the severity of fundamental Islam and how a modern Muslim might live with them without denouncing Islam. The most common response appears to be to ignore those strictures that are not perceived to fit with a modern life, but not to talk much about it and perhaps take offense when asked about it. By contrast, Jews and Christians have no problem distancing themselves from the excesses of their fundamentals (Jews) or their history (Christians). Islam has not come to terms with the modern world in the same way. Islam in the west appears to be just beginning to deal with that.
Donald Trump is right about one thing. The real-world terrorism that emanates mostly from the middle-east and from Pakistan, is inspired by Islamic teachings. When people naively say “Islam is a religion of peace” they are ignoring serious internal contradictions within the fabric of Islam - at the very least that it is a religion explicitly dedicated to world domination by violence if necessary. What they mean to say is that Muslims are by and large, like the rest of us, peaceful people. I am sure that is true. And when Islam is able to make its peace with the world, when it is just another lifestyle choice, a tradition among many, then the world will be a better and more tolerant place. Those Muslims living in the west can and are helping to bring this about in an environment of free and open discussion. Perhaps that will be a coincidental benefit of the age of Donald Trump.
Monday, January 23, 2017
Ok, so the story linked below is getting a lot of play. I am not an expert, but some basic things should be known and are never reported.
The change referred to involves the issuing of permits to build homes and apartments on land near Jerusalem. Jerusalem is a fast growing metroplex. There is a shortage of housing for people who want to live there. Right now Jerusalem in under Israeli sovereignty. The political backdrop is that the vision of the Palestinian leadership, the Palestinian Authority, which is the current incarnation of the Palestinian Liberation Organization (PLO) sees Jerusalem as part of any interim or final settlement with Israel (like a two-state solution). Israel and most Jews dispute this vigorously. If this Palestinian demand is a precondition for a settlement then the whole thing is a non-starter. So to say that Netanyahu's action in allowing the issuing of housing permits kills the two-state solution is not accurate. It is equally the unrealistic Palestinian demand that kills it.
What are the relative merits on each side of this issue of Jerusalem? If one wants to play the ethnicity game then it should be known that Jerusalem was a Jewish city long before it was a Muslim city and that it is doubtful whether Muslims ever had a majority in the city before the 1949 war (when the Jewish and many Christian inhabitants fled). The Jewish quarter was taken over by Muslims.
“The Jordanian commander is reported to have told his superiors: "For the first time in 1,000 years not a single Jew remains in the Jewish Quarter. Not a single building remains intact. This makes the Jews' return here impossible." The Hurva Synagogue, originally built in 1701, was blown up by the Jordanian Arab Legion. During the nineteen years of Jordanian rule, a third of the Jewish Quarter's buildings were demolished. According to a complaint Israel made to the United Nations, all but one of the thirty-five Jewish houses of worship in the Old City were destroyed. The synagogues were razed or pillaged and stripped and their interiors used as hen-houses or stables.” (https://en.wikipedia.org/wiki/Jewish_Quarter_(Jerusalem).
So the notion that Jerusalem is an historically Muslim city is without basis in fact. It is more accurately historically an ethnically mixed city – which is what it is now under Israeli sovereignty. The two biggest ethnic groups are Jews and Arabs (there is an increasing number of Christians living there, but they are a small minority). Jewish and Arab neighborhoods are intricately intertwined and there is no way in any future settlement that they can be unraveled without considerable upheaval. The Arabs living in east Jerusalem work in Israel and have a standard of living a magnitude above those living in the West Bank in an economy segregated from the Israeli economy by the policies of the PA and the reaction to those policies by the Israeli government. So it is extremely doubtful that Jerusalem Arabs would want to live under the PA in any future settlement.
Having said this, there is ample ground for a critical assessment of Israeli housing policy. In general, the Israeli government’s position on land ownership is problematic. Too much of it is owned by the government (I would prefer it all to be private, but this is the age of nation-states). However, for government owned land, access to lease is officially open to all residents, Jewish or Arab (or anyone) and the same is true of privately owned land (http://www.meforum.org/370/can-arabs-buy-land-in-israel). It is probably true, that, in practice, Arabs are discriminated against when it comes to leasing government land.
So, a legitimate cause of concern about the newly available housing permits in Jerusalem is whether or not these permits will be politically granted in the service of the agenda of the religious and nationalist vision of the right-wing political parties. Those concerned for the well-being of the Palestinians should focus of the details of urban development in Jerusalem. Will Arabs have equal access to lease and buy land pursuant to the issue of these new permits? A very valid concern. An open market militates in favor of good relations among the residents.
In terms of the bigger picture, the robust development of Jerusalem, fast becoming Israel’s second largest high-tech sector, is an opportunity for entire West Bank should a way be found to peacefully integrate it into the Israeli economy. A one-economy solution is compatible with a variety of political arrangements.
Saturday, January 21, 2017
Milton Friedman was a genius in discussing social policy. He always seemed to have just the right words to communicate to and disarm the critics of his argument, or his proposals. An economy of expression and a master of clarity.
From reading him I came to believe in free markets. But I remember it was not a pleasant experience - not at first. When he opposed federal aid to victims of flooding located in flood planes, I just "knew" that he could not be right, but reading his logic, I could not figure out where he was wrong. And so it was with many similar issues. I felt anger and resentment at him. So damn sure of himself with his ice-cold logic.
I am no Milton Friedman, but I frequently encounter this reaction when I use the same logic against free-market critics. I am sure many of my like-minded friends do as well. Instead of rational counter arguments I encounter hostility - an impugning of my motives, a labeling of my position, a refusal to engage with the logic. Given how I felt back then I understand this reaction; it is understandable, but it is not excusable - not if it is stubbornly maintained. I came to change my mind, once I got past my ego, and became an admirer of Friedman. Perhaps I am asking too much when I am expecting others to do the same.
[I am not referring to those who have a coherent counterargument, based, necessarily on a different worldview. I am referring to those who have no logical counter argument, but just refuse to accept the implications of that.]
Tuesday, January 17, 2017
Many Americans, myself included, will not be sorry to see the end of Barack Obama as president. The victory of Donald Trump, arguably, owes much to Obama’s many arrogant failures, including prominently the Affordable Care Act (ACA), known unaffectionately as Obamacare. To say the least, Trump is an unlikely candidate for president, and an even more unlikely winner. So, how should we feel about America’s next president, what should we expect?
Clearly there are grounds for some optimism. Trump has promised, and appears to be actively preparing for, a major reform of the ACA; for a significant change of course on environmental and climate policy to remove stupid, debilitating regulations on manufacturing and energy production; a change in education policy to allow for parental choice so kids can escape from the failed public school system; a change in labor policy (where Obama had acted arbitrarily and illegally to support labor unions); and most importantly, a reform and reduction in corporate and other taxes. These and some other proposed initiatives are promising. Some of the people he has nominated for his administration appear committed to following through on these. Let us hope they do.
Also significant for readers of this blog, is the fact that Trump promises a 180 degree turn on Obama’s barely disguised adversarial relationship with Israel. Trump seems to understand the hypocrisy of most of the world vis a vis Israel as evidenced through the actions and deliberations of the United Nations. And on this, I believe he joins the majority of the American people. Going forward the BDS movement and the UN will not find it as easy to pursue their anti-Israel/anti-Semitic agendas as it was under Obama.
But, there are also grounds for concern. Trump is nothing if not unpredictable. It is hard to know what he really believes or on what he will follow through. Some of his nominees seem to have opinions at odds with his, and with other nominees. So will we have an administration that lacks coherence? This would not be good for the American economy, where the biggest problem for private investment has been uncertainty about government policy.
In addition, Trump articulated some specific policy agendas that strike me as very problematic. He promised to rebuild America’s infrastructure in a way that echoes old-style Keynesian demand-side stimulation policies – policies that have been tried and have failed in every generation since Keynesian economics was born in the 1960’s. One of his closest advisors describes himself as an ‘economic nationalist,’ which is very troubling. And this relates to trade policy, the most troubling of all his proposed policies. From what he says, Trump seems not to understand the most basic of all economic truths, the truth that trade is a win-win proposition, both parties to a voluntary trade gain from it. When he talks about trade with China and about reneging on America’s recent Atlantic free trade agreement and NAFTA, he implies that somehow America is losing from free trade. He emphasizes the losses that some Americans suffer by being unable to compete with foreign competitors and ignores the huge gains to others – producers, workers and consumers – that result from trade. He promises to impose trade barriers that protect local workers. This is known as Protectionism, a policy, like Keynesianism, that has been tried many times and failed, but just refuses to die. Protectionism has the potential to destroy economic dynamism and growth completely. Also, his stated position on immigration is very troubling to me.
How much is talk and how much will translate into significant policy remains to be seen. Trump cannot act alone. He will need the Congress to legislate and fund. I am hoping for the best and fearing the worst.
Friday, December 30, 2016
In the wake of the recent Obama abstention in the UN security council, I revisited the Block et. al. article making a libertarian case for the legitimacy for Israel, (here), and nearby I came across a debate between Jeremy Hammond and Rafi Faber (here). I found this debate profoundly unsatisfying and I would judge Hammond the clear winner because of arguments that Faber adopted and failed to adopt.
Faber employs the “historical justification argument" which I do not find persuasive - namely, the appeal, on libertarian principles, to inheritance of a homeland from past centuries, establishing a Jewish right of return. I find this, in fact, downright counterproductive as an argument. At best it is a huge stretch and fails to effectively meet the burden of proof against current residents.
What is decisive in my view, and not stressed by Faber, is the recent history prior to 1948. Those attacking the legitimacy of Israel, if they are knowledgeable, appeal not to the fact that land was actually stolen from the people living there, but to the fact that the JNF bought land, as much of it as possible to establish a Jewish homeland, and discriminated against Arabs in employment, made Arabs very afraid that they would be disenfranchised by Jewish immigration and therefore “deprived” them of their land in an illegitimate way. This is Hammond’s approach. And he is regarded as an effective spokesman for the illegitimacy of Israel. He quotes selectively from official Mandate reports and Jewish pronouncements as to the intentions of Jews to do violence to Arabs. And he ignores the role of the emerging Arab nationalist/Islamist (pro-Nazi)-Arab-League-sponsored movement who perpetrated extreme violence against both Jews and Arabs and who clearly pursued the ethnic cleansing of Jews from the land. He attributes the rise in tensions to increased Jewish ambitions to get rid of Arabs and not to the rise of radical Arab Jew-hatred, which he discounts (incredibly). He also ignores (as does Faber) the hundreds of thousands of Arabs who migrated into the area in pursuit of increased economic opportunity as a result of the Jewish settlements. The Jews of pre-1948 had no state power, no army, no taxing authority, with which to appropriate land that they did not buy or settle (in the absence of any residents). Mass immigrations create tensions, no moreso in Israel than elsewhere. Why this rises to the level of an injustice there and not elsewhere is an interesting question.
Surely it is a bogus argument to object to voluntary transactions on the grounds that they created fear in third parties and discriminated against them in employment - this is not a cogent libertarian argument. And surely the argument from voluntary transactions, discriminatory or not, is a valid one. The argument from historical roots serves simply to obscure the issue and this delegitimizes the valid argument. I wish people would drop it.
Once the state was formed, matters changed. But the state was formed in response to the violence that attempted to ethnically cleanse Jews from the area. Subsequent defensive actions and abuses have to be seen in that perspective. Abuses have occurred on both sides, but Israel’s transgressions are hardly the more egregious. Israel is the freest country in the Middle East. Any lasting and credible peace must work around the situation that now exists and not on the fanciful and prejudicial notion of the dismantling of an illegitimate Israel.
Monday, December 5, 2016
Wende Weinberg died on Sunday morning.
Most deaths are sad and painful for those left behind, but, every now and then, comes along a special person who touches the lives of hundreds, maybe thousands, especially the lives of children, and whose death evokes a great sadness in an entire community. Such a person was Wende Weinberg. Wende worked in our school for two generations - and taught the children of children over the years. She combined competence as an administrator with the heart of a revered religious leader. She was the heart and soul and head of our Jewish studies program. As the wife and right-hand of a rabbi of a vibrant and growing shule she was loved also by all of the congregants. And with all she achieved she was still a young woman with so much more to offer, struck down cruelly while still in her prime. She clung tenaciously to life, determined to do her job as best as she could for as long as she could.
To say she will be missed is woefully inadequate. We shall never see her like again, but her many achievements leave us with a legacy whose value we must nurture and cherish.
Friday, October 14, 2016
That's me in the wagon squinting at the camera - 1963 on kibbutz Sa'ad very early in the morning going out into the fields to pick lemons.
I received this in an email from my classmate Steve Lipshitz - sent to the whole class - who explains:
"Amir Shertzer and Anat Goral-Rorberger have opened an exhibition called "Nostalgia Salon" at the "Beit Omanim" gallery at 9 Alharizi street in Tel Aviv (Not far from Rabin square).
The exhibition consists of pictures taken in Israel 50 plus years ago. They have no idea where the picture come from or who appear in the pictures. They invite readers to identify themselves in the pictures."
How amazing is that?
Tuesday, September 13, 2016
Anguish for today.
I have had another encounter with someone professing libertarian sentiments yet exhibiting troubling inconsistency and bias on the question of Israel and the Palestinians. One almost expects it of 'liberals' these days, but not of libertarians who claim to cleave to the principles of private property, freedom of movement, and non-interference in private transactions. It is a quite common manifest hypocrisy.
One example: many libertarians when faced with the atrocities committed around the world by terrorist groups will point to the effect of decades of oppressive, invasive, deceptive American foreign policy that gives the radicals traction in their own countries. They condemn the barbarous acts but urge a careful, dispassionate, examination of the broader context when discussing responses and solutions. But for the missteps of corrupt, overreaching foreign policy, the radicals would not have the appeal and the power they do. Therefore, the fix is in the politics not on the battlefield.
Yet, some of these same people, when pointing to the excesses of the Israeli government responses to Palestinian terrorism apply a different standard. First, they evidence a surprising trust in the pronouncements in English emanating from the Palestinian Authority - an entirely corrupt, brutal, kleptocracy that lies more than it tells the truth and runs two parallel scripts, one for the west in English and one for the Palestinians in Arabic; yet believe nothing that the Israeli government says. Then, if you point out that, even if they are correct in all of the allegations of brutality and atrocities attributed to the Israeli government (which is extremely doubtful) the sensible approach is to ask how such a government got the power and traction that it did, and that, given the high degree of relative democracy in Israel, what kind of changes would cause it to lose that traction, and to bolster a more tolerant, liberal approach. But they don't want to hear that because it leads back directly to the policies of the PA (and Hamas) and the inescapable conclusion that unless Israelis can be convinced that the Palestinian leaders will not continue to try to do what they say in Arabic that they are going to do (destroy and/or expel the Jews) they will continue to elect the type of government they now have. We must understand the terrorist outrages in Europe and America and Africa and elsewhere as the predictable results of deep-seated bad policy, but we must not see the excess of Israeli oppression in the same way as a predictable response to deep-seated, enduring existential threats that give the oppressors their power.
[I am adopting here their narrative. I do not believe the popular accounts of so-called Israeli oppression, though i do not discount the occurrence of very real abuses and horrible mistakes. Such is the situation. Assad in Syria has killed more Arabs (including some Palestinians) in one month than Israel has killed since 1948. I can't help feeling a huge imbalance in the amount of attention that Israel gets.]
So what is it? I don't really know. There is a kind of insidious anti-Semitism, not the thug type, but of a kind with the reflexive leftist denigration of all aspects of western culture. Israel appears to be singled out because of a subtle, maybe even unconscious, resentment at the success against all odds that it has achieved and (what is seen as) the smugness that this has produced. It rankles. And it produces horrible, troubling inconsistencies that I, for one, find difficulty getting my head around. Calmer, more sanguine, people can ignore it. I try and fail.
Tuesday, August 30, 2016
In 1967, in response to the outbreak of the Six Day War, Murray Rothbard published an article entitled “War Guilt in the Middle East“. In the article, Rothbard denies Israel’s right to exist and accuses it of starting an unjust war.
Now, 50 years later, three of his students, Walter Block, Alan Futerman and Rafi Faber have written a rebuttal, just published in The Indonesian Journal of International & Comparative Law.
This rebuttal is long overdue. Rothbard's article is so horribly flawed and inconsistent with his general framework of libertarian principles as to raise questions about the character of the author. This rebuttal is, unfortunately, very long - but much of this is explained by extensive citations and footnote excursions. Despite the length, it is well worth reading in full for anyone who wants to say anything at all about Israel and the Palestinians in today's world. Click on the link below.
Wednesday, August 17, 2016
Those of us who know something of the history of Israel, know that the 1948 war was a close call, and that, in the early phases, the state of Israel stood on a knife's edge and the Jewish population faced a mass slaughter. This documentary reveals just how close it was. But for the efforts of a handful of, mainly American, volunteer-pilots the outcome would probably have been very different.
It is a story of these pilots, but incidentally also a chronicle of the war and the context in which it occurred. Contrary to the conventional wisdom in some quarters, the Jewish population at the time was composed of immigrants mainly from eastern Europe who, over many decades, had bought land to settle, and was augmented since 1945 by the remnants of the holocaust. Many settled in the cities, had jobs, and worked to build a better future for their families than they left behind in the ghettos or death-camps. The Jews *had no state apparatus by which to appropriate land* and would have been happy to coexist peacefully with the local Arab population - which, in many cases, they did.
The Arabs, or more accurately those Arab leaders who had gained power by the mid-1930's (the precursors of the Muslim Brotherhood), saw it as a tribal matter. The presence of autonomous Jews (infidels) on "Arab" land was intolerable. The partition was necessary simply because the Arabs refused to live in the same state as the Jewish settlers. Certainly, the success of the Jewish immigrants might have bred resentment, which helped fuel xenophobic support for the Arab cause. The Arabs (by which I mean those who followed these leaders) accepted the partition simply as a prelude to the destruction of the Jews - they would be killed or expelled at the first opportunity. The rest is history.
If you are a libertarian and you believe in the freedom of people to immigrate peacefully into an area to work in a job your were voluntarily hired to do or on land you acquired through voluntary exchange, you cannot see the causes of this war in terms of the expulsion of one people by another. The Palestinian crisis was created by the decision of the Palestinian Arab leaders to destroy the Jews and the decision of the leaders of Egypt, Jordan, Syria, Iraq to help them do it. And they nearly succeeded.
Watch this video.
Sunday, June 5, 2016
I grew up 'liberal' in South Africa. When I tried to argue my case, I frequently encountered people who would not talk to me about the facts and the logic and would just shut me down with labels - I represented a threat and a danger to them and to myself.
When I came to America, with the very same views, I was thought of as 'conservative' - the other side. And when I encountered the same reaction in people I tried to talk to about disagreements here, as I had in SA, it greatly surprised me. I was used to being shut down by right-wing bigots, I did not expect it of left-wing 'liberals' who style themselves and think of themselves as inclusive and tolerant. I have gradually learnt to expect this as well.
Monday, May 30, 2016
Clower and Leijonjufjud reconstructed Keynes against the Keynesians - dynamic Keynesianism against static formal modelling - real time versus model time. They pointed to real-world experiences of changes in real time of prices and quantities produced by people acting on their disparate expectations. If incomes adjust rapidly - more rapidly than prices - an "income-constrained" process is possible. Production and employment may fall as a result of pessimistic expectations (loss of confidence, uncertainty) however produced.
My interpretation of real-world history suggests that this is not only logically coherent, it is also possible, and has happened from time to time. One may wonder whether the bounce-back of Keynesianism in the wake of the dot.com bust and the financial crisis, can be defended on the basis of this dynamic Keynesianism. On this I say the following.
1. Though one may see, if one looks hard enough, echoes of the Leijonhufjued-Clower reconstruction in the current climate of Keynesian opinion, it seems to me most of it is simply of the old ISLM, AS-AD variety, either explicitly, or else by implication inside the more sophisticated macro-models (stochastic or otherwise).
2. One may see in recent events evidence of income-constrained processes.
3. But this alone does not a Keynesian policy make. It is one thing to suggest that under some circumstances, the unsupported macro-economy may experience downturns. It is quite another to claim that, therefore, activist macro-policy is called for. There is no 'therefore' about it. Activist policy to be successful requires solutions to formidable knowledge and incentive problems. Failure to overcome these problems makes such policy destabilizing. And there is absolutely no attempt by the reborn Keynesians to grapple with this.
4. The conditions that produce significant income-constrained processes are worthy of examination, and, I would suggest are usually characterized by an accumulation of bad macro intervention policies - like artificially low interest rates, regulatory distortions on a macro scale (housing), etc.
5. Though income-constrained processes occur in the absence of policy distortions, they are likely to be relatively short-lived - quickly self-correcting. This is the empirical counterpart to recognizing the cogency of the argument while arguing against its significance in supporting activist, discretionary policy.
6. Non-Keynesians, Austrians and others, have not denied the possibility of income-constrained processes, like the 'secondary depression' that Hayek refers to. To claim that the unfettered market is basically stable, is not to claim that it is perfect, that it is free of all errors, or that adjustments to change are painless.
Monday, May 16, 2016
Keynes was dismissive of stock markets in the determination of asset prices likening them to a beauty contest. I have some thoughts on this.
In Keynes’s beauty contest the voters form expectations about the judgement of others about the beauty of the contestants. And if everybody behaves like this no one may pay any attention to their opinion about the actual beauty of the contestants. The result is an emergent reflection of the opinion of other people’s opinion. There is no feedback from the ‘fundamental’ beauty of the contestants. There actually is no such thing, since beauty is in the eyes of the beholder anyway. And when the contest is over it is over. Nobody cared about ‘true beauty’.
On the stock market, people form expectations about other people’s expectations of the future price of the stock. And if everyone behaves this way, then the price of the stock depends simply on everyone’s expectations of everyone’s expectations of the future price of the stock. And no one may actually have any expectations about the future price of stock apart from these expectations of expectations (of expectations, …, ?). And the emergent outcome is thus a reflection of these optimistic or pessimistic expectations about expectations. A process without an anchor, says Keynes.
Except that is not the whole story. Unlike the beauty contest, things happen in the world outside of the stock market that affect the price of the stock. Most importantly the company, whose stock is in question, either does or does not have a cash flow from profits. Negative or zero profits means borrowing. This can go on for a while, but “at some point” the absence of profits must impinge upon those expectations because ‘everyone’ knows that the future price of the stock depends ‘fundamentally’ on future net earnings. The palpable uncertainty associated with these asset prices is a result of the ambiguity of the concepts “future”, “at some point”, etc. How long could Amazon actually have gone on without showing any real profits? It went on much longer than many thought possible, and many dot.com companies failed for want of earnings, even while Amazon endured. What determines the strength of investor forbearance in some cases and not in others? For that one needs a valid theory of expectation determination, probably an impossibility.
The stock market, for that reason, however, is not a beauty contest. Earnings, in a sense an ‘objective’ measure of performance depend upon revealed consumer preferences – whether *consumers* not *investors* think the product is beautiful. There is an *outside* judge who is not concerned about the asset price or even the future earnings of the company, but, rather, only about the value to him of the product being produced. That lends the crucial anchor to the process that is absent in the beauty contest. (Again we see the importance of capital accounting).
Friday, May 6, 2016
Today I was privileged to sit among the children of Levine Academy in Dallas to listen to Stan Siegal present the story of his parents, Joseph and Anna Siegal who survived the holocaust and came to America to rebuild their lives.
As the number of survivors still alive dwindles, it becomes ever more difficult and ever more important, to try to portray the horror and significance of this episode in history - for us as Jews and for the world at large. But to speak of it in numbers and historical facts fails miserably to convey that horror and that significance. As Adam Smith might have said, it only becomes real when one hears of real people with names, with dreams and hopes for the future whose lives were disrupted and exploded by unimaginable violence. Certainly when speaking to young children, statistics and dates mean nothing until one peoples them with human beings who have faces. Stan told the story of his parents in a way that could reach these young minds and hearts.
Judaism unequivocally exhorts us to "choose life" The story of Stan's parents is about how they chose life after Anna survived years of slave labor in the gulag of Siberia and Joseph survived years in the woods of Poland with other camp escapees. Though all of Anna's family miraculously survived, all of Joseph's family, his siblings, his parents, were murdered. They met in a displaced persons camp after the war and Joseph married Anna there and also married her family, having lost all of his own family. Their first child was born in the camp. They were not alone in marrying and building a family there.
Consider what it means for people who have endured such suffering and loss to pick themselves up and dedicate their energies to the building of a new life, a new family. The Siegals emigrated to the U.S. and today Stanley and his wife Janet live here in Dallas with two of their three children and three of their five grandchildren who attend Levine academy.
There are many stories like this. They occur against the backdrop of the times. I learned from Stan about the displaced persons (DP) camps (1945 - 1959) that contained at least 500,000 Jews (a pitiful remnant of the Jewish communities of Europe) and many others. Many ordinary soldiers and civilians dedicated their lives during that time to caring for and training these survivors. And (whatever his reasons) President Truman responded to the existence of these camps by achieving a dramatic change in U.S. immigration policy to enable many of those survivors to enter the United States. Decades earlier the waves of European immigration had been stopped and many who perished in the Holocaust might have been saved had that not been so. But after the war, at least the survivors were welcomed.
(I can't help thinking of Syrian Christian refugees in the here and now and how we could be instrumental in saving them).
These survivors who came to the U.S. built successful lives and careers and their children and grandchildren are among America's most successful. They enriched not only themselves but untold numbers who benefited from the value they added.
Other DP survivors went to Israel, where a sizable local Jewish population welcomed them, to England, France (and other W. European countries), South America, Australia and South Africa.
As we remember the dead, let us celebrate the living.
Tuesday, May 3, 2016
What follows are remarks prepared for an event hosted by the Dallas Jewish Historical Society in honor of the South African Jews of Dallas that took place on Monday, May 2, 2016. Roger Cohen was the guest speaker and he spoke eloquently about his book. These remarks were prepared to be delivered in the event that he was not able to make event and are meant as an appreciation.
I have appended some further remarks by way of critical commentary that might be of some interest.
In The Girl from Human Street, Roger Cohen has written a fascinating and unusual book. He is an accomplished and talented writer. His descriptions are vivid and insightful full of original clever little epigrams to encapsulate and summarize his observations.
It is easy to recommend this book to anyone looking for an interesting and informative read, but it will be of particular interest to those who like to read about history, especially modern Jewish history. And it is above all very appropriate to discuss it here tonight because of its South African connection.
Roger Cohen is a well-known and respected New York Times columnist and one-time foreign correspondent. He now calls New York his home (for more than 25 years), but by origin he is a South African, who grew up in England, and has strong Lithuanian roots. Human Street is in Krugersdorp, outside of Johannesburg, and the girl from Human Street is his mother. It is Cohen’s memory of her that hovers over the entire book as he struggles to come to terms with her suffering and the effect that it has had on him. And that suffering appears to him to have a lot to do with her exile from South Africa. So the South African Jewish element features very prominently in this book and I will pay particular attention to it.
The book is what one may describe as a bio-documentary. It is first an historical autobiography stretching from before the beginning of Cohen’s life until some unspecified time before the present. It is a very intimate and detailed autobiography of his past, told through the lives of his family members in various generations. It is probably more detailed and intimate in its revelations than any us could or would like to reveal about ourselves and our families. But in it South African Jews will recognize themselves, as I did, in a strikingly familiar way. It is his story, but it is also the story of most of us expatriate South African Jews of his generation, particularly those of us who have come to America.
So at the inner most level it is the fascinating story of his family for which he clearly has done an enormous amount of research. His talent for writing is evidently a family trait. He was aided in his research by various memoirs of family members, evidencing considerable literary polish. Through these surviving documents and many other historical sources he is able to trace the various strands of his remarkable family and recount their stories over the generations. Most of us Jewish South Africans of Lithuanian origin have not taken the time or expended the energy to find out much about the lives of our ancestors, either in South Africa, or before that in Lithuania, nor about Lithuania after their emigration to South Africa. What would have happened to them had they not emigrated? Cohen has done this and his account is path-breaking.
At another level this book is an historical documentary of the Jews of Lithuania and of South Africa, with significant views of the Jews of England and Israel as well – and a few glances at Italy. In these forays into the surrounding conditions of the time, Cohen delves also into the lives of others, not family members, and treats their stories just as intimately and compellingly as those of his own family.
So there is a lot of stuff mixed up in the telling. It is not a narrative that proceeds in linear fashion from beginning to end. Rather it is collection of themes, “ghosts of memory” (as the subtitle of the book suggests) seemingly randomly presented, but which, upon further reflection, come together in a poignant mosaic. One may wonder, what is the motivation for this particular mode of expression? Before moving on I want to offer a potential explanation for this.
This is a book about identity. Who are we and what makes us who we are? Clearly, we are more than the sum total of our experiences, but those experiences do play a large part in shaping who we are. This works through memory – through the remembering and imprinting of those experiences. But events remembered do not appear in our memory in historical order. They are more random and mixed. One remembered element connects with another far removed in geography and in historical time. Every chapter in the book contains a kind of network of connected memories separated by place and time. The reader thus becomes privy to the way in which the author encounters his memories, and thereby to the reasons for their significance to him.
Lithuania: Cohen weaves his personal family history into the broader historical picture in different places at different times. These include Lithuania at the time of the emigration to South Africa in the 1880’s, Lithuania at the time of the Nazi occupation and extermination of more than 250 Jewish communities, Lithuania soon after the liberation from the Soviet Union and, finally, Lithuania in 2012, a Lithuania trying tentatively and not completely successfully to face up to the reality of what happened there with the submission of many and the active participation of many others in the genocide of the Jews. One learns also that there were indeed Lithuanians who did not stand by and who distinguished themselves by saving Jews at great risk to themselves. But they were definitely the rare exceptions. Most Lithuanians, then as now, simply averted their eyes from the horror.
Lithuania is a very small country that has a traumatic history being squeezed between Russia, and later the Soviet Union, on the one side and the Nazis on the other. After the war, when Stalin had already annexed the country, recognition of the genocide was simply ignored and subsumed into the heroic suffering of the Soviet resistance to the Nazis. It is an old story, under Nazism Jews were vilified as communists (Bolsheviks). Under Communism they were vilified as capitalist collaborators. Lithuania achieved independence with the collapse of the Soviet Union in 1990. Only very recently has the Holocaust begun to feature in the Lithuanian collective consciousness and now school children are, at last, being told about it. They are learning about how centuries of Jewish civilization in Lithuania came to an end in a few months during 1941.
We South African Litvaks have all heard vaguely about the pogroms in Lithuania and that the Jews who remained behind were wiped out, but if you are like me, you do not know much more than that. Cohen uncovers painful but vital details about the history of the Jews in Lithuania, the fruits of careful painstaking research including multiple visits to the towns from which his family members came. Of the four pairs of Cohen’s great-grandparents, three were from Lithuania, from towns in close proximity to each other. (Actually in one case it was his grandparents that emigrated, as is the case with many of us). Two of the towns were Šiauliai and Žagarė. Each town has its own particular circumstances and story of how and when the Jews there met their end. Cohen documents the story of these two towns in stark detail. This is the reality of what our ancestors left, this is the fate they avoided, and in doing so they gave birth to us.
What may not be realized about the Jews in Lithuania is that their demise preceded Hitler’s final solution of the gas chambers. Instead, the Lithuanian communities were for the Nazi murderers a first step along the way to the discovery of a more efficient extermination method. The famous Nazi einsatzgrupen (death squads) specialized in mass executions the old fashioned way - with firing squads and naked Jews lined up in front of the graves that they had been made to dig for themselves. In this way they killed thousands upon thousands in a very short period of time. Cohen quotes a recently erected memorial: ”In this place on October 2, 1941, Nazi killers and their local helpers killed about 3,000 Jewish men, women and children from the Šiauliai region.”
South Africa: Roger Cohen is descended from a remarkable set of ancestors. As mentioned, three of the four pairs that emigrated to South Africa at the turn of the 20th century were from Lithuania, the other couple came from England. Three of the four men, starting with nothing and struggling to overcome hardships and setbacks, eventually made their fortunes, becoming founders of family dynasties in the new South African Jewish aristocracy of riches. One of his great-grandfathers was a founder of the very well-known South African mid-level department store the OK Bazars. His father’s side was of more modest means, but married into wealth.
So we have graphic and familiar descriptions of the life in South Africa for Jews starting in the hard-scrabble immigrant generation, through the formative period, to the ultimate established generation with their mansions in the Johannesburg suburb of Houghton – glimmering swimming pools, lush gardens tended by ubiquitous but invisible black gardeners, lavish meals cooked by invisible black cooks, and waited on by formally attired black waiters, babies and children cared for by uniformed black nannies, all very tranquil and secure.
The South Africa from which we emigrated was rich in blessings both material and cultural. It was a great place to grow up. Our grand-parents, or their parents, had done the hard work and we were reaping the rewards. The Jews were part of the privileged white minority that ruled the country with a view to hanging on to these hard earned blessings. But, of course, there were formidable, if subliminal, tensions. A slightly older friend of mine from that period, the historian Gideon Shimoni, refers in the title of his Ph.D. dissertation on the Jews of South Africa to the Community of Conscience. Whether we knew it or not, we all struggled with the moral dilemmas of living in the midst of the police-state that enforced the Nazi-style requirements of the policy of Apartheid.
Cohen confronts this ambivalence head on. He provides valuable details about the founding immigrant generation – again more than most of us are aware of. His admiration for their achievements is unstinting and well-deserved as is his appreciation of the richness of life in established Jewish South Africa. His South African readers will delight in the vivid familiar scenes – the foods, visits to the Kruger National Park, the rich South African English dialect with its sprinkling of Afrikaans and Yiddish words thrown in. “Howzit, hey?” “Shame, ach sistoch man” “He’s a brainbox” “Let me just go and put on my face” “I stopped at the robot.” [I embroidered here just a bit.]
Whatever the background circumstances there is no denying that it was a period of extraordinary Jewish achievement and creativity. And by contrast to Cohen’s experience in England, South African Jews had no desire to assimilate. South Africa was a society of separate groups living together in an uneasy accommodation. To be Jewish was to be a member of one of those groups. There was nothing to be done about it. They were proud Jews, strong Zionists and they practiced a unique form of Judaism in which the vast majority were affiliated orthodox no matter what their degree of observance – and by the time of our generation most were not observant. We were cultural orthodox Jews who reveled in our various synagogue affiliations boasting of the best cantors or choirs who reproduced the liturgical artistry of the big-city Lithuanian communities that had so recently disappeared. It is natural that in leaving all this behind we felt a considerable loss.
As Cohen points out, these achievement were possible because of the acceptance of Jews into to white mainstream and, notably, because of the absence of institutionalized anti-semitism. It is true that the white Afrikaners, with their seething antipathy toward Britain and to English-speaking South Africans, tended to side with Germany in WWII and identified with the Nazis in their anti-Jewish sentiments. There is a clear incipient anti-semitic movement in Afrikaner history. But after the war, and the gaining of political power, the Afrikaners changed their tune completely, finding it more expedient to coopt the Jews rather than persecute them. They were, after all, white and they were the brethren of those heroic survivors that had founded the state of Israel, in the promised land, out of the ashes of Auschwitz. So began decades of cooperation between the state of Israel and the Apartheid Republic of South Africa.
“Antisemitism was deflected by racism” and Jewish consciences were coopted. But there were notable exceptions, among which were left-wing dissidents, orthodox Jews like the eminent Rabbi Rabinowitz of blessed memory, and the awe-inspiring towering figure of Helen Suzman, the lone Progressive Party member of parliament for decades, a constant thorn in the side of the dictatorial, racist Nationalist Party. But for the majority of South African Jews, as Cohen points out, the name of the game was not to rock the boat. Better not to draw attention to themselves.
This was epitomized in the posture of the organization that styled itself as the official spokesman for South African Jewry, the South African Jewish Board of Deputies. Throughout the Apartheid period the BOD took the position that it would not comment in any way on political matters and thereby it avoided taking a stand for or against Apartheid and its brutal state apparatus. For this the BOD earned the condemnation of many vocal Jews in the midst of the quiet acceptance of the majority. Only very recently in the post-Apartheid period has the BOD acknowledged the unconscionable deception that this entailed. All this and more is recounted by Cohen with sympathetic cogency.
England: Though professing to be an atheist, Cohen feels himself to be a Jew, and a South African Jew at that. His parents were South African Jews even though, following his father’s wishes, they tried to leave their Jewishness behind when they emigrated to England. His mother could never make up for the loss of family and culture and geography that South Africa represented and her mental illness, and the mental illness of other family members, is a recurring theme in the book.
Cohen and his sister spent a lot of time back in South Africa while growing up. Still, England left its impression on him. For him England was in many way the not-South Africa. Though nominally open, polite English society had a way of letting Jews know that they were different and would always be different. He refers to “an ingrained bigotry” and recounts the anti-semitic taunts he endured while in school. Yet, for him, as for all South African Jews, the English experience is pivotal. By an accident of history and geography, we ended up in the English speaking section of the white population of South Africa and we developed a strong, if ambivalent, bond with England and with English culture. For Cohen as for all of us, the English heritage is priceless.
Israel: Israel features throughout the book as it influences the history of the family and of Jewish communities more generally, but it features most prominently in two chapters towards the end of the book when Cohen recounts his visits with family members living there. He is a strong and emotional supporter of Israel in its origin as a refuge for Jews and an admirer of the modern state it has become. It is worth quoting a brief passage.
“My family story, like that of millions of other Jews, leads inexorably to Zionism. By the early twentieth century, no alternative offered a plausible chance of Jewish survival and belonging. As Joseph Roth once wrote, “If there is one nation that is justified in seeing the ‘national question’ as essential to survival, then surely it is the Jews who are forced to become a ‘nation’ by the nationalism of others.” Zionism was a necessary break with past, pogrom and persecution.”
But he is worried that Zionism “sought a state on land that was not empty. Zionist resolution on the Jewish question could only give birth to an Arab question.” In the book and in his other writing Cohen expresses a sincere anguish at the fact that by being forced to defend itself, Israel has become an oppressor. Resort to military solutions has had a brutalizing effect on both sides and he worries about this dilemma seeing a two-state separation of irreconcilable peoples as the only solution. He is dismissive of a one-state solution. “One state, however conceived, equals the end of Israel as a Jewish state, the core of the Zionist idea. Jews will not allow this to happen.”
Cohen’s sincere grappling with these issues will resonate with his readers. And like us he is troubled by the rise in anti-semitism among the left intelligentsia and on U.S. campuses and he is likewise troubled by the spurious comparison between Apartheid in South Africa and the separation of populations in Israel. As a South African Jew he knows the difference.
America: Roger Cohen now feels he is at home in New York. He finds in America an openness that was lacking in England. America is a land of immigrants, a land constructively fashioned out of people’s differences. We as Americans are united in our differences. We can be whatever we are, while still being enthusiastic Americans. What better adopted home from which to contemplate and wrestle with the “ghosts of memory” that are the substance of this intriguing book.
Critical appraisal – three comments
One: As noted, this book is difficult to categorize. It is part autobiography and part historical documentary. At times it may seem like the expression of an unconstrained stream of consciousness. Some people have told me that they found this problematic. I suppose it depends on the reader. I think Cohen took a risk in creating the book in this form, but it did work for me. I was not troubled by the frequent jumps in and out of the personal to the general and back. But, clearly, some readers will be.
To worry about the oppression of Palestinians by Israelis as a betrayal of the core Jewish values, values intrinsic to the founding of Israel, is certainly legitimate. The Israeli military and the Israeli government can be and should be called to account in a way that other governments in the region never are. There is a palpable double-standard, and maybe that is ok insofar as we as Jews set that standard for the only Jewish state. But to think that Israel is the ultimate cause of the poverty of Palestine and for the suffering of the Palestinians is just wrong. Cohen, like so many others, fails to mention that the Palestinians have been kept in refugee-dependency not by Israel but by the UN, by the various Arab states who have used them as pawns for their own nefarious purposes, and, perhaps most importantly, by the mendacious, corrupt, self-serving leaders that constitute the Palestinian Authority. It is the PA that has deprived them of the vote by refusing to hold scheduled elections, not Israel as Cohen suggests.
If Israel is responsible at all it is by handing over governance of the territories to the PA via the Oslo Accords. Palestinians fared much better under Israeli rule than they do now under the joint rule of the PA and the Israeli military. It is hard to see how a two-state solution is possible when one of the states is ruled by a grasping kleptocracy bent on the destruction of the other state.
In fact, the only solution, if there is one, may indeed be a one-state setup in which Israeli civil law is extended to all the inhabitants of the territories together with the option to apply for Israeli citizenship. The fear that this will mean the demise of the Jewish state, though understandable, is probably unfounded. The population of the territories has been dramatically overstated by the Palestinian demographers and the growth of the Palestinian population is slowing down, even while Israeli populations growth is stable and high. Under civil law the Palestinians will be able to develop their own voices and solutions. And while some may elect to apply for Israeli citizenship, many will probably not. Other types of political arrangements, like some sort of local federalism, may emerge.
Whether and under what circumstances such a move (to extend civil law to all of Israel and the territories) is possible is another matter. How this could be done and what the reaction of various parties might be is the subject of Carolyn Glick’s provocative book, The Israeli Solution. Whatever one’s opinion on this, it seems to me that no peaceful coexistence will ever be possible until a way is found to allow the Palestinian people at large to express their own individual goals and desires and this implies a change in leadership and in political system that no one seems to be talking about.