Where should Americans live if they live abroad?

I'm a huge fan of living abroad, and I think many more Americans should do it. Living in a big, rich country with relatively few other countries nearby, Americans don't tend to travel overseas much. And of course, a great many don't have the economic opportunity to do so. I think there should be government programs that help young Americans travel and live abroad, and I think more charities, religious organizations, and other nonprofits should focus on helping people go overseas.

In a recent Twitter thread, I explained how I think living abroad changes one's perspective. In addition to the obvious benefits of cosmopolitanism - helping people realize that people around the world aren't so different after all, etc. etc. - I think it conveys a healthy appreciation for how hard institutions are to get right. Living in Japan for a few years, I got to observe institutions that work better there (cities, primary education), but also institutions that in many ways don't work as well - like the media, universities, corporate culture, the justice system. In fact, the institutions that Japan struggles with the most tend to be things that Americans complain about a lot.

Thus, living abroad taught me that institutions are very hard to get right, that tradeoffs and path dependence are very real, and that even the smartest people (in this case, Japan's vaunted elite bureaucracy) can often get things wrong for a very long time. I think I returned to the U.S. with a deeper appreciation of how hard it is to make a society work the way you want it to, and how precious functional institutions are. It made me both less satisfied with the things America does wrong - for example, urban density and transportation - and more wary of tearing up the things that actually work halfway decently. I can see the same sort of perspective in the writing of some of my favorite writers, including James Fallows and Terrell Starr.

OK, so if you're young-ish and looking to live overseas and gain some perspective, where do you go? Or if you're a nonprofit looking to give young Americans some perspective by sending them overseas, where do you send them? Japan's not a bad choice, but I imagine that there are even better places in terms of comparing/contrasting local institutions and culture with the U.S. Here are some ideas:


1. China

China has got to be the obvious choice, because the country is just so important to the world economy and to geopolitics. This is the Chinese Century, so might as well try living where the action is! Making connections to China could be very useful in life, in addition to any perspective gained.

Furthermore, China's one-party rule, development-oriented state, and close cooperation between government and companies make for an important and interesting institutional contrast. Chinese politics, ethnic divisions, and sense of history are also probably all very interesting and different. Some of these differences are very scary, but scary things can also be instructive. James Fallows is one of my favorite writers, and his time in China shaped him deeply.

The big problem here is that unless they speak Chinese (which, due to the large # of characters and the tonality, is not the easiest language to learn), an American's ability to really get to know people in China might be limited. Being trapped in the expat community is an easy way to avoid getting the full experience of a country. Though notably, some Americans who have actually lived in China claim that Chinese ability isn't as necessary as you might think.

I hear through the grapevine that the best city to live in is Shenzhen, though of course Shanghai and Beijing will always be popular (and Sichuan in general has my favorite food!). There are tons of other places to choose from, too.

Alternative: For those who want to see an up-and-coming superpower with more democratic governance and more English usage, try India.


2. Germany

When choosing a foreign country to live in, there's a balance between choosing one that's too similar (in which case you might overlook the important differences) and one that's too different (in which case you might assume there are no relevant lessons to be learned). Germany might be in the sweet spot. It's a rich Western country, which contributed more immigrants to America than any other nation except possibly Mexico. But it also has a very different economy and set of institutions -- worker councils and co-determination, strong vocational education, export- and manufacturing-oriented industrial policy, and dense urbanism with good public transit.

Germany might therefore be the best country if you want to see different ways to run an advanced economy. Also, lots of people can speak good English, and the country is safe, wealthy, beautiful, and fun. It might also give good perspective on issues of ethnonationalism, what with its WW2 history and its recent acceptance of large numbers of Middle Eastern refugees.

Berlin is the most famous place to live - it's very cheap, and is a legendary party town, with lots of history. But Munich is my personal favorite.

Alternative: France is a country with similar points of interest, though its economic model is a bit different and its English usage is a bit less.


3. Brazil

Brazil is, in many ways, America's "sister country". It's a large, populous post-colonial Western Hemisphere nation with a history of slavery (abolished 1888), a history of immigration, and a very diverse population. For those who are intent on living somewhere nice, it's also famous for its natural beauty and fun culture (though with a murder rate 6 times as high as that of the U.S., it's also a bit dangerous).

Brazil could offer some broad perspective on how to make a very diverse young society with a checkered past work for all its people. Economically, it's middle-income (slightly poorer than China), with some advanced industries but low productivity growth. It may therefore be a good example of the "middle income trap" - a country that is no longer mired in poverty but is struggling to make it into the ranks of wealthy nations.

Alternative: For those who would rather stick closer to the U.S., Mexico shares some of these points of interest.


4. Ethiopia

My Bloomberg Opinion colleague Tyler Cowen strongly recommends Ethiopia. If you want to see a developing country just on the cusp of industrialization, Ethiopia might be your best bet. Thanks to a recent improvement in political stability and a torrent of foreign investment (much of it Chinese), Ethiopia looks like it's hopping aboard the train to industrialization. That could mean useful commercial advantages to living there, if you want to invest and get in on the ground floor! And because Ethiopia is the first African country to start out on this manufacturing-based growth path, you'd be there for a historic moment.

The country is still desperately poor -- its income per capita is less than 1/30 that of the United States. But living in a desperately poor country is a good way to see what life is like without industrialization, and why countries rush to embrace it despite all the pollution, safety issues, and other drawbacks.

Alternatives: Other countries going through similar rapid industrialization, but slightly farther along, include Bangladesh and Vietnam.


5. Ukraine

It might feel a bit voyeuristic to go live in a country that is mired in troubles. But it could also be very instructive. Despite a history of industrialization as the center of Soviet heavy industry, and despite some of the world's most fertile agricultural land, Ukraine remains poor. It's mired in economic stagnation, political dysfunction, and a seemingly never-ending war with a small Russian-backed breakaway region in the east. If you want to see how a country with lots of advantages and close connections to the West can still struggle in this day and age, Ukraine is probably your best bet.

Of course, Ukraine also no doubt has much charm. Terrell Starr lived there and liked it. Nor is he the only one. It's cheap, and if you decide you'd rather return to the comfort of the developed world, other European countries are very close by!

Alternative: You could always take the full leap and go live in Russia.


So there are some suggestions of where to live if you're looking for some international perspective (with a bit of adventure thrown in). Of course, I haven't lived in any of these places, so this post is highly speculative. In the end, you won't know until you go!

Guest post: Roy Bahat on Uber, Lyft, and the future of work

Roy Bahat is the head of Bloomberg Beta, a venture capital firm focused on the future of work. In this guest post, he explains what he thinks is wrong with the way the "ride sharing" companies treat their workers.

____________________________________________________________________

AS GOES UBER, SO GOES THE NATION

HOW MIGHT IT LOOK TO NEGOTIATE A “TREATY OF SILICON VALLEY?”

Roy Bahat

Lyft could go public as soon as this week, with Uber tailgating. For either to succeed, they have to stop the rot at the core of their business: their drivers are suffering. Like a factory worker in a 1950 auto plant, Uber and Lyft drivers epitomize the struggles of many Americans today. To solve their drivers’ challenges, Uber and Lyft might need to strike a new bargain for all of American work, a new “Treaty of Detroit.”

The Treaty of Detroit, just after World War II, established employers as the providers of benefits. Then, the big three automakers rang up outsized profits, which depended on working people welding, painting, and assembling. Those people suffered unacceptable conditions, like many gig workers today, so they organized.

United Auto Workers chief Walter Reuther pressed General Motors to create the standard for a full-time job in America: health insurance, vacation, enough of a wage to provide for a family, regular raises, and money for retirement. He negotiated, in one word, security.

--

Our economy and society are different today. Family lives come in many forms, and our workforce is more diverse. In a family headed by a single parent or by two working parents, all work, not just full-time jobs at profitable companies, must provide for stability.

Lyft and Uber, like many companies in the new economy, have been unable to provide their workers with a stable and complete livelihood. Still, with their bully pulpit and their relationship with millions of Americans, they might be our best hope for provoking change.

That change starts with something unfamiliar to Uber and Lyft: partnering with government. Instead of using their muscle to whine to cities about taxi regulations, Uber and Lyft should call on government to lift the floor for working people. They could ask the federal government to pay for healthcare, joining the conversation about Medicare for All (as they did during the discussions about the Affordable Care Act). Government could set a minimum wage for drivers, as New York just did, so we riders pay our fare share.

Lyft and Uber could enable drivers to choose their own paths, in what’s now called “lifelong learning.” Uber offers online college classes for free at Arizona State. Driver centers could offer GED-equivalent classes, or help drivers build their network and then learn how to network. Imagine if drivers, who Lyft and Uber chose to brand as “independent entrepreneurs” at the height of the employee-or-contractor game, actually received support to become genuine entrepreneurs -- like financing, or access to mentors to help them with business plans? Or better: Uber and Lyft could buy services from companies owned by their own workers, to create the spark of demand that gets them going.

This company-supported learning might extend to developing drivers’ careers at Uber and Lyft. Unlike a retail store, where the cashier sees the manager every day and gets a shot to build a relationship and prove they can do that job, the app-is-my-boss experience gives drivers only the thinnest exposure to management. So Uber and Lyft need to invent ways to get drivers into corporate headquarters, or risk permanent castes dividing their workforce.

Maybe workers conceded too much in the Treaty of Detroit, and drivers should organize to have a representative on Uber and Lyft’s boards? Uber’s CEO, Dara Khosrowshahi, talks about his family coming from struggle. What if the Dara Khosrowshahi of 2030 is someone driving for Uber right now?

Despite the avalanche of investor money that blanketed Uber and Lyft, they barely earn enough revenue to pay their costs. It’s hard to imagine them paying more for driver healthcare. They’re also locked in a do-si-do where if one raised prices to pay drivers more, we riders would probably just pick the other one -- you know you would. So a “Treaty of Silicon Valley” would need government to both level and raise the playing field.

---

After the Treaty of Detroit, the President of General Motors said “what was good for the country was good for General Motors, and vice versa.” Uber or Lyft might say the same today. The technology companies driving changes in work need to call on government and workers to strike a new bargain, and then do their part to invest in those workers’ futures. Big corporates, who have long shifted work from employees to contractors, might follow -- and we might all agree to a new treaty that will hold for another 70 years.

A proposal for an Alternative Green New Deal

Usually, Bloomberg Opinion understandably does not want me to repost my Bloomberg articles at this blog. But they made an exception for my Alternative Green New Deal plan. So here it is.

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The planet is in grave danger from climate change. No reasonable person can doubt this fact. Drastic and immediate action is needed to reduce global carbon emissions.

But that doesn’t mean that any sort of drastic action is a good one. The Green New Deal, proposed by Representative Alexandria Ocasio-Cortez, has two big flaws. First, the plan overreaches in its desire to deliver a raft of expensive new entitlements — guaranteed jobs, benefits, health care, housing, education, income and more. If the large deficits required to pay for all of these things ended up harming the economy, it would actually hurt the cause of limiting climate change rather than help it. Second, the plan focuses far too much on the U.S.’s own carbon emissions. The U.S. accounts for only about 14 percent of global carbon output, and that percent is falling every day. The climate change battle will be won or lost in developing countries such as China:

So I propose an alternative Green New Deal, which would focus on actually defeating climate change. Some of the proposals here are included in the Green New Deal resolution; some are not.The first pillar of an alternative Green New Deal would be green technology. If the U.S. can discover cheap ways of manufacturing cement and concrete without carbon emissions, and of reducing emissions from agriculture, it will give developing countries a way to reduce carbon output without threatening their economic growth. To this end, the U.S. should pour money into research. The budget of ARPA-E, the agency charged with leading this research, should be increased from about $300 million to $30 billion per year.

The second way to move green technology forward is to encourage the scaling of these technologies. As companies build more solar power, batteries, smart grids, low-carbon building retrofit kits and other green technologies, the costs go down. To that end, the government should provide large subsidies to green-energy companies, including solar power, batteries and electric cars, as well as mandating the replacement of fossil-fuel plants with zero-carbon plants.

Infrastructure spending is also important. The original Green New Deal’s goal of building a smart electrical grid is a good one, as is the idea to retrofit American buildings to have net zero emissions.

Technologies developed in the U.S. need to spread quickly to other countries. All ARPA-E breakthroughs should be freely transferred to other countries, through the offices of the United Nations Framework Convention on Climate Change or other agencies. Subsidies should be increased for companies that export their emissions-reducing products. The plan should also include offers of favorable trade relations for countries that reduce their use of fossil fuels, as well as tariffs on the carbon content of imported goods.

An alternative Green New Deal should also provide incentives for higher density in urban areas, since sprawl contributes to emissions. It shouldn’t require the decommissioning of nuclear plants. It should also implement a carbon tax, something now missing from the plan. This would encourage factories to reduce carbon output, to encourage air and sea travel to search for lower-carbon alternatives and to address various other sources of emissions.

In addition, an alternative Green New Deal should include proposals to make sure as little as possible of the costs of the transition fall on the economically vulnerable. Government infrastructure and retrofitting projects will naturally create many green jobs. The proceeds of a carbon tax can be rebated to low-income Americans, either as a carbon dividend, or through earned income tax credits, child tax credits, food stamps, housing vouchers and income support for the elderly and disabled. These policies combine the goals of fighting climate change and supporting the poor and working class.

In order to sweeten the deal politically, an Alternative Green New Deal should also include some economic policies that aren’t directly related to climate change — but make sure these are things that should be done anyway, and which won’t break the bank. Universal health insurance, which would free employees to move from job to job, as well as giving the government power to negotiate lower health-care prices, should be included. Increased spending on public universities and trade schools in exchange for tuition reductions, and grants to help lower-income students pay for these schools, would help increase educational attainment without being too costly.

Finally, an alternative Green New Deal should involve progressive taxes, both to raise revenue for the spending increases and to let the nation know that the well-off are shouldering more of the burden. Wealth taxes and inheritance taxes are good ideas. Income taxes should also go up, not just on the super rich, but on the affluent and the upper-middle class as well. And most importantly, capital gains and dividends should be treated as ordinary income, which would increase the tax rate actually paid by the wealthy.

This alternative Green New Deal has similarities to Ocasio-Cortez’s version, but also has key differences. By focusing on technological development and international assistance, it would tackle the all-important problem of global emissions. By avoiding huge open-ended commitments like a federal job guarantee or universal basic income, and by including progressive tax increases, it would avoid the threat of excessive budget deficits. Ultimately, this plan would represent the U.S.’s best shot at fighting the looming global menace of climate change while also making the country more egalitarian in a safe and sustainable way. It would be a worthy successor to the original New Deal.

Book Review: The Revolt of the Public, by Martin Gurri

If you do not read "The Revolt of the Public and the Crisis of Authority in the New Millennium," by Martin Gurri, you will not be sufficiently prepared for the world to come.

Well, you probably won't be anyway. No one will! But this book brings together a startling number of important threads of contemporary politics, geopolitics, public affairs, and media, and weaves them into a coherent, comprehensible, and very plausible narrative. And it does so far better than any other book, blog post, or Twitter thread that I have seen attempt to deal with these issues (including my own modest foray). So buy this book and read it.

Why This Book Is Great

The basic thesis of the book is that social media has empowered the public, and that the public is using its newfound power to attack - but not to replace - the dominant institutions of society. Citing examples from the Arab Spring revolutions to the Indignado protests of Spain to Occupy Wall Street and the Tea Party, Gurri pegs 2011 as the year where the new paradigm of viral, explosive discontent first asserted itself. 

Importantly, Gurri defines the "public" in a weird, idiosyncratic way. It's not the people as a whole, so it can't be represented by opinion polls. It's not the "masses" of the mid 20th century, since it's not organized into hierarchical mass movements coordinated by leaders. Instead, Gurri defines the public as the set of people who are interested enough in a particular issue to pay attention and get involved. Thus, the public is actually a different set of people in each situation.

(Gurri's public is somewhat similar to my own conception of the "Shouting Class", but not quite the same. The Shouting Class are the set of people who are always vocally upset about one thing or another, due to their own personal life dissatisfaction, natural argumentativeness, desire for attention, or other factors that can't be assuaged or mollified by any change in the structure of the world. Gurri's public often includes these people, but often also includes non-shouters who genuinely care about one particular issue or are moved to action by viral enthusiasm instead of their own natural predilections.)

Social media, Gurri asserts, has both empowered and emboldened the public, freeing it from the control of centralized, hierarchical push-media. The age of Walter Cronkite has given way to the age of the Twitter mob and the Facebook protest organizer. But the newly empowered public, he argues, has not focused on building things up, but on breaking them down. The public's goal is negation - denunciation of respected leaders, derailment of political programs, overthrow of parties or governments, discrediting of institutions, etc. 

Gurri worries that this constant anti-everything attitude will descend into "nihilism", and that weakened institutions will be trapped in an eternal stalemate with an eternally raging public. The events of the 2010s have certainly conformed to this description. And the book, the first edition of which was released in 2014, looks especially prophetic when viewed from the vantage point of 2019. All the trends Gurri describes have only intensified.

The usefulness of this book is in drawing parallels between a bunch of things that might seem unrelated (and as a former CIA analyst, that's Gurri's specialty). If the many explosions of anger and activism since 2011 were fundamentally about specific issues - the Tea Party about taxes, the Women's March about sexism - then you might expect the anger to recede as the issues get successfully addressed. But if Gurri is right, these things are fundamentally about a technology - social media - and the way it changes power relations between the public and elites, then we can expect today's explosions of anger to be followed by others tomorrow, and then others the day after tomorrow, and on and on and on. 

Gurri may not convince you - in fact, if he does, you're probably not enough of a skeptic - but he will give you a new framework with which to usefully think about the political chaos of the modern world.

That said, there are some limitations, omissions, and missteps in the book (as there are in every book). Here are the biggest things I think Gurri left out:.

More Than Two Futures

Near the end of the book, Gurri allows for the possibility that his big thesis might be wrong. But he demands that readers choose between his hypothesis and the "null hypothesis" - i.e., the exact opposite of every trend he describes. If he's wrong, Gurri asserts, the world will proceed toward greater centralization, greater hierarchy, greater trust in and respect for authority, etc. etc. 

But this is a false choice. Gurri's vision is complex and multi-dimensional, not a univariate hypothesis that can be tested against a null. It's perfectly possible that Gurri's description of the world will hold true in some respects but not in others. For example, it may be that elites and institutions never regain their aura of Olympian invincibility, but that the public becomes more constructive over time, eschewing nihilism and pushing for big utopian visions like the Green New Deal. Or it might be that elites never become effective or respected, but successfully implement systems of total social control similar to the one China is trying to implement. Or it might be that elites never recover their power and effectiveness, but the public gets tired of outrage and finds something else to do, leaving society in a comfortable stasis.

There are many possible futures, not just two. 

Underrated Public, Underrated Elites

Gurri takes a very even-handed approach toward the public and the elites. He criticizes the former for its inflated expectations and destructive nihilism, while taking the latter to task for failed grandiose promises, tone-deafness, and exclusion of outside voices. But my impression is that he is a bit too hard on both.

Recent protests in the U.S. have not been completely nihilistic - often, they've motivated real, concrete policy changes. Occupy Wall Street probably contributed some popular energy to the push for financial reform, which culminated in the Dodd-Frank law. The Black Lives Matter protests, which Gurri mostly doesn't touch on, may have led to needed police reforms in many cities. In Tunisia, the Arab Spring led not to bloody civil war, but to the first green shoots of liberal democracy. I'm not a big fan of the Tea Party, to put it mildly, but they did seem effective in their goal of forcing Obama to cut spending.

Meanwhile, elites have not failed as badly as Gurri describes. The era of desegregation, civil rights, and the Great Society saw massive, permanent decreases in the black poverty rate (and modest decreases in the white poverty rate):

During the mid 20th century, the era Gurri describes as High Modernism, the U.S. government also built the interstate system and helped create the early internet, in addition to implementing Medicare. Other rich country governments successfully implemented government health care systems that to this day are highly effective and relatively cheap. Government research pushed forward the frontiers of science and technology in ways too numerous - and too important - to count.

More recently, efforts by the Clinton, Bush, and Obama administrations led to modest but real decreases in poverty. Even after Obama was checked by a Republican Congress, his Clean Power Plan helped start a transition from coal power to natural gas and renewable energy. Gurri excoriates the Obama administration and the Federal Reserve for failing to stop the Great Recession, but it's notable - and at the end of the book, Gurri even admits - that things never degenerated into another Great Depression. The system may not have worked perfectly, but it worked. 

In other words, the public often gets things done, and government often gets things done. Gurri is too hard on both. 

So Why the Rage?

Gurri accuses the public of nihilism, and that accusation often seems right - especially when it comes to Twitter outrage mobs and the more radical political movements that have fought each other in the streets since 2017. But he doesn't really explore the reasons for this rage. He mentions elite failures - the Iraq War, the persistence of poverty, the Great Recession. But he also characterizes the public as being generally drawn from people whose personal circumstances are not so dire. So why are people so mad?

One possibility is that we're dealing with a "revolution of rising expectations". This is the theory that an era of steady progress leads to ingrained expectations of continued progress, or even accelerating progress. So whenever the inevitable slowdown or minor reversal arrives, a generation with great expectations explodes in rage at the future visions that suddenly seem denied to them. Last September I wrote a Twitter thread applying this idea to disappointed educated young people and the rise of the socialist left in America. The process might apply more generally. It might have been the success of modern societies and their elites, rather than their failure, that set the public up for disappointment and rage.

This Might Have All Happened Before

Gurri declares 2011 to have been a "phase change" in human relations, and portrays modern social media outrage and protests, and the chaos they cause, as something new under the sun, crucially dependent on information technologies that have never existed before. But the events he describes sound strikingly, even eerily similar to those described in another book I read recently: "Phantom Terror: Political Paranoia and the Creation of the Modern State, 1789-1848".

"Phantom Terror" describes how, in the wake of the French Revolution, the governments of Europe became extremely paranoid about the existence of conspiracies they believed were fomenting revolution. They implemented police states, but could find no such conspiracies. Yet revolutions happened anyway - spontaneous, grassroots revolutions, culminating in the upheavals of 1848. Some governments fell and were replaced, most endured, and the character of European governance largely persisted even though institutions and their legitimacy seemed permanently weakened. And all of this without any centralized hand or elite conspiracy driving the revolutions - just a bunch of spontaneously materializing mobs. Sound familiar? 

Another pair of books I read recently were "Nixonland: The Rise of a President and the Fracturing of America" and "Days of Rage: America's Radical Underground, the FBI, and the Forgotten Age of Revolutionary Violence". These books described the political upheavals of the late 1960s and 1970s - smack dab in the middle of the elite-dominated industrial age. These were years of chaos. Hundreds of riots, striking every major American city. Widespread protests. High-profile assassinations. Thousands of (mostly non-fatal) terrorist bombings every year, very few coordinated or directed by any organization or hierarchy. And this chaos repeated itself throughout Europe, and in much of the rest of the world - witness China's Cultural Revolution. 

These were two former eras, one far in the past, one recent, in which spontaneous activism and popular rage led to widespread rejection of elites and endemic political chaos. And yet in each case, the public didn't need Facebook or Twitter to revolt - all it needed were pamphlets, independent newspapers, books, or that ultimate information technology, word of mouth.

So the Revolt of the Public might not be such a new thing under the sun. Instead, it might be a recent manifestation of a recurring phenomenon - a periodic eruption of popular discontent. Such a cycle might be driven by improvements in information technology - the printing press, telephones, radio, blogs, and now social media. Each time information technology improves, it might lead to an explosion of chaos and rage while elites and institutions struggle to adapt. But each time in the past, the slow-moving engines of government, business, and media have eventually figured out how to put the lid back on public rage. It may turn out similarly this time. 

More historical perspective might have also affected Gurri's predictions and recommendations, which he delivers at the end of the book. Gurri predicts a compression of society's hierarchical pyramid, and recommends that governments adopt a combination of localism and responsiveness. But over the last few centuries, as information technology has improved, government has tended to move in the opposite direction - toward greater control, greater intrusiveness, and greater projects of centrally directed social change. In the 1400s, government was highly localized and parochial, with the exception of the occasional conquering army. Why should we expect to go back in that direction? Instead, should we not expect Even Bigger Government and Even Higher Modernism to eventually assert itself as the antidote to social media rage? 

In Conclusion

These omissions in the book should only emphasize how thought-provoking it was, and how interesting and useful of a framework Gurri has created for evaluating the modern world. I'm not repudiating Gurri, but riffing on him. I'm sure if you read this book, you'll find yourself doing the same.

So grab a copy of "Revolt of the Public". In these turbulent times, it provides a much-needed map.



Update

Martin has a friendly response to my review! He basically says that A) government may have done OK, but the public is never satisfied, B) government may have done OK but it over-promised relative to what it could deliver, and C) the public often doesn't even want real change, just to protest and get mad and feel important.

Those all seem right to me. These ideas are part of the reason Revolt of the Public is such a great and important book.

Book Review: "The Souls of Yellow Folk," by Wesley Yang

"He was ugly on the outside, and once you got past that you found the true ugliness on the inside."
- Wesley Yang, "The Face of Seung-Hui Cho"


Wesley Yang is not here to make you feel comfortable. He's here to find your most vulnerable places, and then, methodically, to poke you in those places. To pierce the veil of optimism that you use to get through your days. To make you think thoughts like: What if nobody really loves me? What if nobody really loves anybody? What if your failures are all your fault? What if they're not your fault at all, and society is out to get you?

Wesley Yang is here to make you sit with discomfort.

The Souls of Yellow Folk, a collection of Yang's essays, is a very Generation X work, in an age when Generation X is being rapidly eclipsed and forgotten. The voice is that of the disaffected, semi-detached loser, blaming himself for his own condition even as he watches the world grind down the people around him. It's Beck/Nirvana/Mudhoney/Soundgarden/Eminem. Really, the closest comparison I can think of is the graphic novels of Adrian Tomine.

This ironic, self-deprecating attitude extends to the book's provocative title, a play on W.E.B. DuBois' The Souls of Black Folk. Besides both being collections of essays, the two books aren't similar at all. Though some of Yang's essays deal with the Asian-American struggle, many don't. And even the ones that do offer little in the way of a practical program for racial advancement or emancipation. The message - ironic as always - seems to be that Asian Americans don't have "souls", or at least "soul", in the way that Black Americans do. That while Black Americans can find purpose in their long struggle for emancipation, inequality, and economic survival, Asian Americans find themselves like atomized specks adrift in a capitalist, postmodern fog - earning high incomes and long ago freed from systematic government oppression, yet denied promotions and invisible in popular culture. Free to succeed or fail as individuals, but denied the security of inclusion in a Real America that may or may not even exist.

"The Face of Seung-Hui Cho", the first essay - and one of the most powerful pieces of literature I've ever read - is nominally about the mass murderer who shot 49 people at Virginia Tech University in 2007. But really it's an autobiographical essay, about being Korean American and reacting to news of a massacre by another Korean American. Yang takes the gnawing question, which most people wouldn't even dare to ask themselves, and asks it openly: Could that have been me?

Cho was an incel killer before "incels" were even a thing - a man who blamed his sexual failures for his depression and alienation, who blamed women for his sexual failures, and who blamed society for his failure to attract women. Our usual approach to such people, whether or not they become violent, is to anathematize them - to assume that they're beyond the bounds of comprehension, like some scholars have claimed the Holocaust is. To slap labels on them - "insane", "psycho", "misogynist" - and to then drop them in a mental trashcan where we no longer have to think about what makes them tick. They're not a matter for empathy or human understanding - they're a matter for the FBI.

And for most of us, this approach makes sense. We don't need to go through life wondering what it would take - if it would even be possible - to make us, too, pick up a gun and murder dozens of innocent human beings. There's no need to spend our emotional bandwidth on that. We have better things to do.

But Wesley Yang attempts it. He goes right to the most vulnerable place, right to the horrible question: Was Seung-Hui Cho denied romantic love because he was an Asian man in a racist America? And did the shame and loneliness of that denial push him over the edge from mentally disturbed young man to mentally disturbed young murderer? If girls had been attracted to Seung-Hui Cho, would he have ended up safely recuperating in a mental hospital instead of with a bullet in his head? Would his victims be alive today?

Probably not. Almost certainly not! But we'll never quite know, will we? And it's this terrible never-quite-knowing that's at the center of many of Yang's essays. In "Paper Tigers", Yang deals with the bamboo ceiling, and the way that Asian Americans denied promotion are forced to endlessly wonder whether it was systemic racism, bad luck, or their own personalities that held them back. In "Game Theory," he profiles the protagonists of the 2000s-era pickup artist movement, and asks whether even a lifetime of practice seducing women could make any man successful finding real romantic love. In a trio of essays - "We Out Here", "Is It OK to Be White?", and "What Is White Supremacy?" - he asks whether the social justice movement's crusade to purge structural racism, well-intentioned as it is, will end up creating a set of impossible expectations for society.

In one of my personal favorites, "Inside the Box", Yang recounts the dawn of technology-assisted sex culture - ubiquitous porn, dating apps, and all the rest - and recalls wondering whether they would kill romance, and whether romance was always a lie. He takes this further in "On Reading the Sex Diaries", where he dissects the anxieties of promiscuous tech-addicted New Yorkers who desperately hope for romance even as they distract themselves with intrigue.

The exception to the theme of discomfort might be Yang's profiles of famous individuals; several of the essays are portraits of people like chef Eddie Huang, technologist Aaron Swartz, and political scientist Francis Fukuyama. These aren't bad pieces - Yang's impressive command of the English language means that nothing he writes is bad, and there is a lingering tone of uncertainty over the value of even the most successful people's achievements. But the detached, journalistic approach of these profiles somewhat breaks the mood of the rest of the book.

Reviews of The Souls of Yellow Folk have ranged from the insightful to the airily dismissive. Some of the reviews seem a bit like "Reviewer 3" - academic slang for a scholar who complains that your research paper doesn't happen to be the one he would have written. Viet Thanh Nguyen, writing in the New York Times, expresses disappointment that Yang didn't turn his anxiety about anti-Asian racism into a call for organized political struggle. But organized political struggle just isn't what Yang is about. He belongs to a different literary tradition - one that sighs and broods and stares out a window instead of shouting and marching in the street. Call me crazy if I think our society needs both kinds of writers.

An insightful piece in Slate by Sophia Nguyen, however, hits closer to home. Near the end of her review, she notes that women are conspicuously absent from Yang's essays - the profiles, the protagonists, and the villains are all men (with the exception of Amy Chua, who gets a brief profile!). There's nothing necessarily wrong with that, of course - if you want to write about men, you can write about men. Men are people, men are interesting.

But I'm not satisfied. For a writer who took on the monumental, soul-crushing task of empathizing with a mass murderer, it can't be that hard to empathize with a woman or three. I want to know what Yang thinks it's like to be the women his male protagonists dream of finding romance with and winning validation from. I want to know if he thinks the bamboo ceiling feels different when there's a glass ceiling as well. I want to see him profile at least one famous woman.

But there will be time for that. I have a feeling Wesley Yang is just getting started. In the meantime, pick up a copy of The Souls of Yellow Folk, and enjoy being uncomfortable.

Book Review: "Stubborn Attachments", by Tyler Cowen

Tyler was good enough to give me a review copy of his new book, "Stubborn Attachments: A Vision for a Society of Free, Prosperous, and Responsible Individuals", so here is my review!

This is a philosophy book. It tries to answer the question of what a society's priorities should be. That's interesting, because Tyler is usually a very circumspect guy who doesn't like to come out and make strong value statements. So it's cool that he's finally telling the world, in no uncertain terms, what he thinks society should be all about!

There are two things about the way Tyler approaches philosophy that I really like. First, he's very informal, and doesn't bother to painstakingly define terms or refer to things other philosophers have said. That would probably annoy some people in the academic philosophy field, but it makes the book extremely readable even for a layperson. 

Second, he doesn't try to set out an absolute, formalistic, fully internally consistent system of ethical principles - instead, he embraces an eclectic, often conflicting set of principles. This is refreshing, since rigid systems always prove fragile to intuitive counterexamples. Too much of ethical philosophy seems to consist of people finding intuitive counterexamples to rigid systems of principles, forcing advocates of those principles to redefine them in a way that wouldn't invite those counterexamples. As a sort of a Humean, I kind of believe that people's ethical systems are all just derived from moral intuition, and aren't really internally consistent, and never will be, and thus shouldn't have to be. It's therefore refreshing to see Tyler embrace a sort of eclecticism, where he draws at will on several different principles. This sort of philosophizing has very little formal discipline to it - it's basically just saying "Here's what I think is good". But so what? That's basically what we always end up doing anyway.

Anyway, OK, on to the actual ideas in the book. Basically, the book is an argument that long-term growth is the most important thing a society should strive for. The reason is that future people are just as important as present people, and the future is extremely long, so there are lots of future people. Thus, making sure we keep growth going is the most important thing we can do, morally speaking.

Importantly, Tyler makes sure to include sustainability in this calculation. Growth in technology doesn't matter much if the planet is unlivable. This point is inserted as a caveat, and deserves more attention throughout the book than Tyler gave it; he should have talked a bit more about environmental policy. But it's good that he put that qualification in there.

Tyler's moral reasoning appeals to me; I strongly agree that we should care more about future generations. 

But the problem with this idea is that it doesn't lead to a lot of actionable policy ideas. Tyler seems to think that laissez-faire economic policies are often pro-growth. But this is usually only true in the slang sense; most economists would say that cutting taxes or cutting harmful regulations raises efficiency, but not steady-state growth. It seems unlikely that a change in the top marginal tax rate from 40% to 25%, say, would compound over the centuries into living standards that are hundreds of times higher. In a typical Econ 101 setup or Ramsey growth model, the tax cut would simply bump up GDP a bit, and then growth would continue as before.

The big exception to this is Romer-type endogenous growth. If a slightly higher GDP results in a slightly higher research expenditure, which discovers a slightly higher number of new ideas, which leads to a slightly higher GDP, etc. etc., then the long-term benefits of anything that raises GDP today are absolutely enormous. 

But how much do we really believe that model? Did the Industrial Revolution - the greatest explosion of human living standards ever observed - start in Britain and the Netherlands because GDP was a bit higher there, which allowed the economy to support a higher number of researchers? Maybe, but I think even Paul Romer would be incredibly skeptical about that historical story. Instead, there were probably some institutional or contingent factors at work. 

Which brings us to my main problem with Tyler's big thesis - what are the actionable ideas here? Tyler mentions the problem of uncertainty - the fact that we don't really know what will lead to sustainably higher growth - but IMHO ultimately doesn't deal with it to my satisfaction.

The Industrial Revolution was the biggest sustained growth success story in the history of the human race. But now imagine you're an administrator in Ming Dynasty China in the 1400s. What policies do you recommend in order to make China industrialize? Even with the benefit of centuries of hindsight, the answer is not obvious at all. You can dig up coal, build factories, etc., but plenty of countries tried this approach with disappointing results. Even now, we don't know what combination of factors allowed Britain to succeed (accidentally!) at industrialization when other countries' later, deliberate attempts failed.

And if we don't know the magic growth-shifting policies in hindsight, how likely are we to know them ahead of time? 

This goes double for sustainability. The Industrial Revolution was amazing, but there's still some chance - small, in my opinion, but real - that the whole thing will cause the death of the planet's environment and make it permanently uninhabitable for the human race. If so, we might eventually wake up and realize that we would have been better off staying as subsistence farmers, trapped by the Malthusian ceiling, for many thousands of years, instead of enjoying a few centuries of doomed affluence. (Note again: I think this is unlikely, but it's hard to rule out). 

Anyway, the big weakness of growth-above-all-else-ism is that we mostly don't know what policies are likely to produce the kind of sustained, self-compounding, super-long-term growth that Tyler rightly declares we should prize. And given the risk that what we think are pro-sustained-growth policies might ultimately retard the rate of super-long-term self-compounding growth, this risk acts as a sort of discount rate - a reason not to completely sacrifice our present on behalf of our future, because we don't really know whether we're sacrificing our present to destroy our future. (In many economic models of intertemporal choice, risk aversion and time preference aren't separable, so this is just a hand-wavey version of that.)

BUT, that said, I do think there are a couple things that we can focus on that are more likely than not to result in super-long-term sustainable growth improvements. These two things are scientific progress and technology that enhances environmental sustainability. 

The more ideas humanity knows, the higher the probability that the increase in our choice set gives us access to things that raise super-long-term sustainable growth. So, science. 

And the more tools we have to reduce our use of finite resources, the higher the probability that our choice set includes futures where we don't destroy ourselves by destroying our environment. So, sustainability tech.

Thus, "Stubborn Attachments" reads to me more like a manifesto for basic research and green technology than a manifesto for laissez-faire economics or any of the other things that commentators call "growth policy". If we want to leave a much better world for our infinite future generations - and to maximize the infinitude of those generations - basic research and green technology are our best bet. 

Yuppie Fishtanks: YIMBYism explained without "supply and demand"

YIMBYism is the idea that cities need to build more housing in order to relieve upward pressure on rents. In Northern California, where I live, YIMBYs tend to get into fights with progressives about market-rate housing. YIMBYs don't want to build only market-rate housing, but they think market-rate housing has to be an important component.

NorCal progressives, in contrast, tend to think that market-rate housing is bad - either they think it lures more high-earners into a city and pushes up rents (induced demand), or they object to private housing developers making profits, or market-rate housing just sounds like cities catering to the needs of richer residents instead of poorer ones. Instead, the progressives tend to support what they call "affordable housing" - either public housing, government-subsidized housing, or privately-subsidized housing mandated by inclusionary zoning.

When defending market-rate housing, many YIMBYs appeal to the idea of supply and demand. If you supply more market-rate housing, the market rate itself will fall, making many previously unaffordable houses into affordable ones. This might be true - in fact, evidence suggests it is true, at least to some extent - but I think it's a weak defense, for several reasons.

First of all, supply and demand is a simplistic model. It assumes a single homogenous good, when in fact everyone knows that housing comes in a bunch of different types. It doesn't take location into account, when everyone knows location is crucially important in urban real estate. And there are some situations, especially labor markets, where supply and demand just seems like a bad model for how the economy really works.

Second, the effect of new supply on rents might not be enough to help working-class families. If you build a ton of new housing and rents only go down by 3% - or go up by 3% less than they would have otherwise - it's not going to do a lot to help the people who progressives really want to help. Because of this possibility, "supply and demand" can sometimes sound a bit like "let them eat cake".

But in fact, I think it's very important to build market-rate housing. And though the forces of supply and demand are probably at work, I don't think the supply-and-demand model captures exactly why market-rate housing is important. So in this post, I want to try to explain the YIMBY position without invoking supply and demand.


Background: Invasion of the Tech Yuppies

The structure of the U.S. economy has changed a lot in recent decades. Knowledge-based industries like tech, medicine, and finance are much more important - for simplicity's sake I'll refer to all of these as "tech". Tech businesses have ever more of an incentive to cluster together in cities, which means that tech workers - who tend to earn high salaries - have been moving into cities like San Francisco.

If they're going to work in the city, these tech workers are going to want to live in the city. Where will they live?

Some will move into shiny new glass-and-steel apartment complexes downtown:

Looks kind of like a fishtank, doesn't it? A beautiful fishtank for yuppies.

But these beautiful giant yuppie fishtanks have limited space. So some of the incoming techies will go looking for apartments in other parts of town - neighborhoods occupied by long-time residents.

Many of the long-time residents currently renting these units are working-class. Many come from disadvantaged minorities. Some are artists or other creative types. 

The incoming techies have lots of money to spend, and landlords - the people who own the units where the long-time working-class residents live - know this. Therefore, they have an incentive to raise the rent, which usually means the working-class residents have to move and the techies will occupy the nice old Victorian apartments pictured above.

Now, often they can't do this, because of rent control. But there are things they can do to get around rent control. They can convert units to condos. They can evict tenants under the Ellis Act. Or they can just wait for residents to move out, then raise rents.

Additionally, not all apartments are subject to rent control, so often this isn't even necessary - landlords can often just raise the rent, which usually results in the replacement of working-class tenants with yuppie newcomers. 

The result: Displacement, gentrification, and an increasing rent burden on everyone not protected by rent control. 

How to Prevent Displacement From the Tech Invasion: The YIMBY Solution

The YIMBY solution to the problem described above is simple: Build more of the pretty glass fishtanks to catch the incoming yuppies as they arrive.

Most of the yuppies would probably rather live in the fishtanks. The fishtanks tend to be located downtown, near to where the yuppies work (SoMa, Embarcadero, etc.), rather than in the older residential neighborhoods. Additionally, the fishtanks are pretty and modern and new, with gyms and common space and other stuff yuppies like. Probably more attractive for the average yuppie than an aging Victorian far out in the Mission or Haight with no built-in community or on-site services.

Even more importantly, long-time working-class residents and struggling artists and disadvantaged minority families are highly unlikely to go live in a yuppie fishtank. That means that every unit of yuppie fishtank housing - i.e., new market-rate housing - that you build will either A) be occupied by a yuppie, or B) sit empty on the market. Landlords want to fill all of their units, so if there are too many fishtanks and (B) happens, they'll drop the rent until more yuppies move in.

Eventually, every yuppie fishtank unit that you build will be occupied by a yuppie.

Now if the new fishtank units catch the incoming yuppies and prevent them from invading long-time residential working-class neighborhoods, that's good!

And if the new fishtank units lure yuppies away from long-time residential working-class neighborhoods, that's also good!

If the new fishtank units instead draw yuppies in from other cities - for example, in the Peninsula to the south - that's not ideal, but also not so bad. It means more yuppies in the city, but they'll be living in fishtanks instead of in long-time residential working-class neighborhoods. In other words, it's a wash - it neither increases nor decreases the total number of gentrifiers. (In any case, I think this is unlikely to happen much. The number of tech yuppies moving to SF is constrained by the number of tech offices in SF - almost no one wants to commute down the peninsula and back every day if they can help it. and yuppies are usually rich enough to be able to live near their jobs if they want.)

So the YIMBY solution to the yuppie invasion isn't - or shouldn't be - just to build market-rate housing anywhere and everywhere. It's more like the following:

A) Build market-rate housing that appeals specifically to yuppies, clustered in specific neighborhoods away from long-time working-class residential areas.

B) Instead of tearing down existing housing to build market-rate housing, replace parking lots and warehouses and other inefficient commercial space with new market-rate housing.

In other words, YIMBYism is about yuppie diversion. It uses market-rate housing to catch and divert yuppies before they can ever invade normal folks' neighborhoods.

Why Affordable Housing Is Not a Great Solution to the Yuppie Invasion

Affordable housing - a catch-all term encompassing public housing, publicly subsidized housing, and privately subsidized housing - is popular among progressives, and is often put forward as an alternative to market-rate housing. 

Although YIMBYs believe affordable housing is good (for reasons I'll explain below), they also believe it's not a very good solution to the yuppie invasion described above. Why? Because affordable housing accommodates gentrification instead of preventing gentrification. 

Suppose you're a long-time working-class resident who gets displaced by rising rents. Now the government offers you affordable housing somewhere else in the city. Well, at least you still have a place to live, and at least you're still in the city you've always lived in, right? But you have to move out of your home, which is expensive and emotionally draining. And you probably have to move to a new neighborhood, where your local ties will be weaker. In other words, it would have been better if you never had to move at all.

So if cities can catch and divert the incoming yuppies (with new market-rate housing) instead of accommodating displaced working-class people, it's much better.

Why Affordable Housing Is Good Anyway

Affordable housing isn't a great solution to the tech yuppie invasion, but YIMBYs still want to build affordable housing. Why? Because affordable housing allows working-class people to move into the city to avoid commutes. 

Building new market-rate housing probably doesn't draw many new yuppies into a city from outside, since if their jobs are outside the city they'd still have to commute; most people would rather not commute, and yuppies can typically afford to live near where they work. But many working-class people are forced to commute from outside the city. Affordable housing changes that equation. It allows more working-class commuters to live closer to their jobs.

NIMBY Solutions to the Tech Yuppie Invasion?

The YIMBY solution of catching and diverting incoming yuppies with market-rate housing (yuppie fishtanks) seems like a good one because it creates a city where everyone, yuppies and working-class folks alike, can live, while limiting the disruption to long-standing neighborhoods and communities. 

But some progressives dream of other solutions, based on strengthening protections against yuppie invasions of long-time working-class neighborhoods. For example, repealing the Ellis Act, making it harder to evict tenants. Or strengthening rent control, making it harder to raise rents when a tenant leaves.

YIMBYs generally support repealing the Ellis Act. Rent control is more ambiguous, since it tends to hurt a lot of working-class people while helping others. 

But initiatives like these, on their own, won't be enough to create a good city for working-class residents. 

When combined with prohibition of market-rate housing development, these initiatives seek to drive yuppies out of a city entirely. By creating an iron-clad, invincible wall around working-class neighborhoods and apartments, and confining them to ever-shrinking, ever-more-highly-priced islands of market-rate housing, this strategy seeks to force yuppies (and possibly their employers as well) to leave for greener pastures.

But this is not a good idea. Driving yuppies and tech businesses out of the city means lower tax revenues. Those tax revenues are essential for paying for city services for the poor and working-class. Public housing, housing subsidies, homeless shelters, drug addiction clinics, social workers, public transit - these things all rely on tax revenues. And tech businesses and yuppies provide those revenues.

NIMBYism, even progressive NIMBYism, doesn't lead to a city that works for everyone. It sacrifices prosperity, and (even more importantly) the social services that prosperity makes possible, in order to avoid the cultural change that comes from having yuppies walking the streets.

That doesn't seem like a trade worth making. A successful city is one that doesn't simply preserve itself in amber, but embraces positive change that will improve the lives of its working class and poor residents. 

Wait - Does This Explanation Really Throw Away Supply and Demand?

Astute readers will notice that supply and demand isn't completely absent from this explanation of YIMBYism. But this explanation contains several major departures from the textbook supply-and-demand theory that you might learn in an Econ 101 class.

First of all, in a typical supply-and-demand model, there's only one kind of housing. In this explanation, there are three kinds of housing - "yuppie fishtanks" (new market-rate housing), long-time resident housing, and affordable housing. Market segmentation is real. This is something activists actually understand better than people who think only in terms of supply and demand.

Second of all, a typical supply-and-demand model of housing ignores location. In this explanation, location is crucial - the YIMBY solution is to build new market-rate housing in neighborhoods like SoMa, so that incoming yuppies go there instead of to neighborhoods like the Mission.

(Now, there are far more complicated economic models out there that capture all of these ideas and more. These models are actually more nuanced and realistic than my explanation here. But it's very hard for most people to think in terms of these models, and these models can also give different predictions depending on their assumptions.)

So when defending the YIMBY position, it's important to go beyond simply yelling "supply and demand". I hope this post gives YIMBYs a language to talk about market-rate housing without having to assume that all housing is the same, or that location doesn't matter. 

Market-rate housing isn't the only solution to the problems facing cities like San Francisco. But it is an important, even crucial part of the solution.

Update

Want some evidence that the "yuppie fishtank" strategy really works? Here you go:

In neighborhoods where new apartment complexes were completed between 2014-2016, rents in existing units near the new apartments declined relative to neighborhoods that did not see new construction until 2018. Changes in in-migration appear to drive this result. Although the total number of migrants from high-income neighborhoods to the new construction neighborhoods increases after the new units are completed, the number of high-income arrivals to previously existing units actually decreases, as the new units absorb a substantial portion of these households. On the whole, our results suggest that—on average and in the short-run—new construction lowers rents in gentrifying neighborhoods.

This is exactly how it's supposed to work.