Friday, October 05, 2018

I Will Return To This Point

Okay! Just wrapped up Capital in the 21st Century, and I really want to get my thoughts down while it's still fresh. It's a dense, readable, gripping book about topics that tend to seem arcane or irrelevant, and Piketty makes a compelling case for why citizens of democracies ought to pay attention. I can see why this book and the subjects it raises have formed the center of recent political debate in the US and elsewhere, and visiting to the source has helped me better understand the sense of urgency it's been getting.

Reading this book is a long commitment, well over 600 pages of economics, but it's organized extraordinarily well: most sections are just about two pages long, clearly establishing a single point that can then be built upon. There's some math, but just three (important!) formulas over those 600 pages. Lots of graphs, a few tables, and some great quotes from Jane Austen, Honoré de Balzac, Titanic, and other fiction. When talking about this book, I feel a little like when I'm recommending a good but intricate television show. "It gets really good starting in the third season." "You have to watch about ten episodes to start getting a feel for what it's doing." Or it might be more like watching a game of Magic: The Gathering or Starcraft. Piketty clearly and efficiently lays groundwork, you see things building up but are not sure to what purpose; and then bam, around 300 pages in he starts tapping his cards and launching his protoss and becomes kind of hard to deny.

For my own sake, here's my personal summary of the book's thesis:

As background, economics as a field has become far too enamored of abstract, theoretical, mathematical models. "Assuming an economy with perfect competition and actors pursuing rational self-interest, what happens to X when Y does Z?" Outside of the field, politically motivated thinkers develop theories, then cherry-pick circumstantial economic data to support their desired outcomes. Piketty insists on a data-first approach: we have multiple centuries' worth of data on wealth and income and capital and tax rates and all sorts of stuff, so let's examine the data and develop theories based on that, not the other way around.

His terminology and benchmarks are similar to but slightly distinct from popular ones used in the past, such as the labor-capital split or GDP. He tends to focus on numbers as a percentage of national income, as this enables clear comparison between countries and years. He uses "capital" more or less synonymously as "wealth". Capital is something you own that produces money, whether it's dollars in a savings account, a home, stock certificates, a copyright, whatever. You can find a country's total capital by adding up the cost of all that capital: the sum of all bank deposits, the appraised value of all real estate, the market capitalization of the stock market, the going rate for copyrights, etc. National income is the sum total of all the money earned in a country for one given year: adding up everyone's paychecks, interest, rent, dividends, royalties, etc. You can then compare capital to income and get a sense for how much wealth has accumulated in a country, relative to the size of its economy.

Throughout the book, Piketty mostly focuses on France, England, the United States and Germany. Piketty is French so it's understandable that he would lead with France as an example, but he also has a great reason for this: France has fantastic detailed historical records going all the way back to the French Revolution that provide fine-grained insight into the financial state of the nation. He frequently compares these four countries, and their similarities and differences are very interesting in their own right: they generally follow the same curves, even in the pre-globalized economy, but there are some great lessons to be drawn from, for example, the relatively clean-slate start of the United States or the impact of Germany's multi-stakeholder approach to corporate governance. He occasionally brings in other examples like Sweden, Canada, Australia, or China, always carefully pointing out where data is missing or inadequate or otherwise not a good source of comparison.

One of the more ambitious projects comes early on, when he examines the history of wealth over the last two thousand years, using scant historical data and models to draw rough conclusions about what happened from 0AD until now. In summary: nothing much happened from 0-1700AD; the economy and population started to grow a tiny bit quicker for the first century of the Industrial Revolution; then it picked up significantly and we saw significant growth during the 20th century. Most economists have assumed that this is the normal environment and drawn all their conclusions based on that, but as Piketty points out, the 20th century was very much an aberration and cannot continue. In terms of population growth alone, the boom is mostly over, with Europe now having a stable population and America mostly supported by immigration; it's impossible to predict what will happen in the rest of the world, but if the 20th century increase in growth rates were to continue Earth would have a population in the trillions in a few centuries, which seems impossible to sustain.

For the most part, Piketty is interested in the period for which we have more detailed data, roughly from 1800 to the present. Looking at the size of capital relative to national incomes, we see a steady and high level (roughly 700% of national income) until the start of World War 1, then a rapid decrease through the two world wars and the Great Depression until bottoming out around 1950, then a gradual rebound until the present, eventually reaching a ratio close to what existed at the peak of the Gilded Age and continuing its upward trajectory.

Why is this? Piketty patiently works through the dynamics of capital accumulation. First, an accounting formula: α = β * r. That is: the share of capital in the national income is equal to the proportion of capital to national income, multiplied by the rate of return earned by capital. More concretely, if a country's accumulated capital (everything owned by its private citizens) is four times the national income, then β = 4. If the average rate of return of all that capital is 4%, then r = 0.04. As a result, α = 16%. Even more concretely, if this is a country where the national income is 1 trillion dollars, then 160 billion dollars will go to the owners of capital (stockholders, landlords, authors, etc.) and 840 billion dollars will be distributed as wages.

This is a tautological formula, but is helpful for thinking about how these things are related. If the value of capital in a nation increases, while the rate of return remains the same, then capital will claim an increasing share of the national income.

So: as time passes, do we expect capital to increase or decrease? The singular event around which this book turns is the period from 1914-1945, which drastically wiped out fortunes around the world and especially in Europe. A kind of perfect storm happened. There was literal destruction of capital, as bombs fell across Europe and destroyed real estate and artwork and farmland. Massive inflation destroyed the value of bonds that had been purchased in a no-inflation environment. Debts were entirely repudiated, such as after the Bolshevik revolution. Overseas colonial possessions were lost. Industries were nationalized. Confiscatory tax rates were charged to finance the war and its debt.

All this turmoil had a profound and real impact on accumulated wealth. Just as importantly, though, it is the only time we see when wealth comes under assault. Other than this, the data consistently shows, across multiple continents and multiple centuries, the steady and increasing share of capital in national economies. This proves very resilient even across different technological eras and governmental structures. Farmland used to be the major component of national capital; today it occupies a miniscule share, but financial capital has more than made up for its decline. Capital accumulation in France continued unabated as the nation shifted from republic to monarchy and back again. The United States started with extremely low capital as its early settlers arrived with very little, but immediately embarked on the same march of accumulation.

So, in the absence of a catastrophic series of events like the early 20th century, what is the "natural" stake that capital will claim in an economy? This brings up the second formula, β = s / g. That is, the share of capital in the national income will, over the long run, reflect the nation's long-term savings rate divided by its long-term growth rate. More simply, as the savings rate goes up, more capital will accumulate; as the growth rate of the overall economy increases, though, the share of capital will decline. 

The savings rate is just how much money doesn't get spent. This may vary a little based on national culture and priorities: an aging, pessimistic population will consume less and save more, while a young and optimistic population will tend to save less. But it's also worth noting that income from capital tend to be plowed back into more capital. If you didn't need to spend that money in the first place, you probably don't need to spend what it produces, so you can save the fruits of what you've previously saved.

Piketty divides the growth rate into two components, population growth and productivity growth, that are simply added together. In other words, the growth of a nation's economy is the sum of the growth of its population (how many more people will be doing work) and the growth in its productivity (how much more work each individual person can do, on average, thanks to improved technology or education or training).

During the second half of the 20th century, we've grown accustomed to think that national growth "should" be around 4%, but as Piketty compellingly shows, that is unrealistically high and unsustainable. Historically, the growth rate was close to 0% from 0-1700AD. Even the industrial revolution, with its much-vaunted productivity, produced an annual growth rate of around 1%. Most of the immense productivity gains of the 20th century was thanks to population growth, a boom that is over in Europe and slowing elsewhere. Piketty sees a total growth rate of 1.5% as the upper bounds of a realistic, good growth rate, with even 1% good by historical standards. The only time we can see a sustained growth rate of significantly higher than that (the 3-4% people want) is when a less-advanced economy is catching up to the technological innovations of a more advanced economy, as happened in Europe and Japan during post-WW2 reconstruction and as is happening in China today. Eventually the economy catches up to the threshold of innovation, and from that point on, it can count itself lucky to sustain a growth rate of 1% plus whatever population growth it can manage.

I found it helpful to intuitively think of β = s / g like this: when the growth rate is high, a lot of new dollars are entering the economy. The total size of the economy grows more quickly than people can save, so capital shrinks relative to the economy (even though its total size increases). When growth slows, capital still continues to increase, but at a faster rate than the economy, so more of the new dollars produced by the economy will be "stored" in capital. Eventually you reach an equilibrium where the allocation of new dollars from growth matches the existing ratio of capital in the economy, at which point β and g stay consistent and the total sizes continue to grow at the same proportion.

What's the upshot of all this? During the 20th century, we saw a decline in the value of capital, followed by a very slow recovery of capital, and people (who were very reasonably drawing from their immediate experience and evidence of the present) assumed that the new normal of the global economy was fundamentally different from that of the 19th century: Marxism had been refuted, his dire predictions of ever-increasing capital disproven, and now everyone would enjoy in the fruits of a more egalitarian and labor-friendly market that would continue indefinitely.

Piketty's point is that the slow recovery of capital post-WW2 was a direct consequence of the abnormally high and unsustainable growth rate. Now that growth is slowing, we see capital accumulation correspondingly accelerating, at the same rates we saw during the Gilded Age. There's no natural force that will stop this accumulation or prevent it from passing the highs we saw then.

The obvious question is: so what? Up until this point, Piketty has focused only on aggregates, what's happening in nations as a whole. Now he starts to look at what's happening within nations, how those top-line numbers break down and affect individual citizens' lives within those countries.

High capital accumulation isn't necessarily intrinsically bad. We can imagine a society where capital is shared more or less equally, where most citizens have comparable wealth. In practice, this would likely mean that each person would have a cushion against unexpected turmoil. They would still need to work for a living, but might not need to work as many hours to achieve the sort of lifestyle they desire, since it would be supplemented by payments from other citizens on their capital.

In practice, does this happen? Hell no. We're now moving into the more politically charged part of the book, as Piketty walks through a wide-ranging look at the breakdown of wealth (and income) across nations. This is the part of Piketty that most of us have heard about. He breaks down wealth into deciles and centiles, looking at what percentage of people own what percentage of capital. His talk of "the bottom 50%" and "the top 10%" allows him to systemically compare equivalent benchmarks across diverse societies, in the way that traditional categories like "the upper class" and "the working poor" cannot.

To summarize his findings: the poor have always been poor. Not only that, they've been consistently destitute: from the United States to Germany to Australia, from the 1850s to the 1900s to the 1950s to the 2000s, the bottom 50% of the population owns between 0-5% of a nation's wealth. That means that, in the best case, the median member of half the population owns 1/10 of their mean share. The one exception Piketty finds: in the 1970s and 1980s, the Scandinavian countries' bottom 50% owned as much as 10% of their nations' wealth. Even then, the best example we have in all of history, they owned 1/5 of their mean share; far more often, the poor own nothing, and have nothing to pass on when they die.

Where there has been some change over the past century is the bracket from the 10% down to the 50% wealthiest, who you might broadly call the "middle class". During the Gilded Age this cohort owned around 5% of their nation's wealth. Today, they own around 25%. In other words, today, the upper half of a county (excluding its very top) holds about a quarter of their nation's wealth. In absolute terms going from 10-25% might not seem like much, but it more than doubles their prior share, and has a significant impact on their (our?) lives and prospects. Piketty calls this the rise of the "patrimonial middle class": people who, over the course of their lives, can assemble a modest financial legacy that they can then pass on to their children.

The upper 10% is of course much wealthier. For all the recent rise in inequality, we are not yet at the levels seen during the Gilded Age. Back then, the top 10% of a country's people owned 90% of its wealth, so each member of the upper class owned, on average, nine times as much as the mean wealth. In contrast, today's 10% owns about 70% of the nation's wealth, or a mere seven times the mean wealth. The effect gets more pronounced as you climb higher up the scale. On the eve of WW1, the top 1% owned 50% of the wealth; today, the top 1% own 35% of the wealth.

The underlying reason for this is his third and final observation: inequality increases when r > g. In other words, when the rate of return on capital is greater than the growth rate of the entire economy, those who already hold fortunes will accumulate money at a faster rate than the rest of the economy. Money acquired in the past wins out against new wealth created today. Those holding capital will pull further and further ahead of everyone else, snowballing and eventually drawing down not only new national income but even cutting into what others are earning. The early and mid 20th century was a time when g > r: growth was abnormally high due to a booming population and post-war reconstruction, and r was unusually low thanks to high taxes and governmental policies like rent control. But that period was an aberration. Now that growth is slowing, and taxes on capital were  demolished in the 1980s and 2000s, we are witnessing the return of the Gilded Age's plutocrats.

Again: so what? The standard argument is that those in the top brackets are there by basis of merit: they've worked harder and smarter and taken more risks, so they're rewarded with fortunes. Piketty painstakingly walks through the data to show that this isn't the case. Yes, people can earn fortunes through a lifetime of hard work (especially in the era of high growth that we're currently exiting): but those who inherit fortunes can earn just as much without working a day in their life. He brings this home with a vivid, concrete example. Bill Gates was the wealthiest man on Earth for about two decades, during which time he built Microsoft into a megalith and revolutionized computing. Piketty is deeply skeptical of the entrepreneurial cult worshiping Gates - he points out that Gates' contributions are heavily indebted to the work of thousands of computer scientists who did not receive anything close to his rewards - but, still, two decades of hard work at the top of his empire saw Gates' fortune expand by about 10% per year (in real returns). To contrast this, he looks at Liliane Bettencourt, the richest woman in the world. Liliane did not work at all: she inherited her fortune from her father and lived as an heiress. And during those same 20 years when Gates' fortune expanded by 10% per year, Bettencourt's fortune expanded by 10% per year. Beyond a certain point, capital becomes self-perpetuating. The existence of self-made millionaires in the Wealthiest Americans list shouldn't obscure the fact that many more people got there through accident of birth. And, furthermore, that trend will accelerate in the future: as growth slows and capital stocks accumulate, those lucky enough to inherit a fortune will have an insurmountable lead, reaping returns on their capital far more quickly than anyone can accomplish through a lifetime of labor.

There's a lot of other great stuff in this section, some of which I'll return to down below, but for now I'll skip ahead to the final section. So far we've gone through three explicit arguments (capital shares naturally increase over time, capital shares grow inversely to the economy, existing wealth in the past is rewarded far more than new labor generated in the present and will lead to a widening gap between the ultra-wealthy and everyone else) and one implicit assumption (it's bad for a society to have a tiny class that owns virtually everything and a large class that owns virtually nothing). The fourth section considers what can be done about this. Previous economists thought that the market economy would naturally solve inequalities over time, but if it won't correct itself, it will require political action to do so.

Piketty makes a forceful case for creating a global, progressive, annual tax on capital. Across planet Earth, every nation would sum up the net worth of each citizen (all their assets minus all their debts) and tax the result. Piketty admits that it's virtually impossible that such a tax would be implemented, but still thinks that it's a good idea and a great conversation to start, so he walks through it in detail to show how it could be set and what it would accomplish. To make it concrete, he imagines charging perhaps 0.1% on wealth under 200,0000 euros, 0.5% on wealth up to 1 million euros, 1% on wealth  from 1-5 million euros, and 2% on wealth over 5 million euros. Higher rates could be set on even higher brackets, with perhaps 10% on fortunes over 1 billion euros. The taxes at the top would not bring in all that much revenue, since not many people earn that much, but would be an incredibly powerful force for reducing inequality. The middle brackets, on the other hand, could bring in an enormous amount and potentially replace many (not all) other taxes charged today.

It's interesting, for example, to think about the property tax. Imagine you buy a house today for $500,000. You pay $100,000 as a down payment, and borrow $400,000 as a mortgage. Suppose your state charges a 1% annual property tax, which comes to $5,000 a year. You own 20% of the house and the bank owns the other 80%, but you're responsible for 100% of the tax payment and must pay the full $5,000.

Now imagine the capital tax. Suppose you own that $500,000 house, and have another $100,000 in various financial assets (bank accounts, mutual funds, etc.), and owe that $400,000 loan to the bank. You add up your assets ($600,000) and subtract your debt ($400,000) to reach your total capital ($200,000). That would place you in the 0.1% tax bracket, requiring you to pay $200. The bank owns the other $400,000 of capital in your home, which is added to its net worth, which is ultimately paid by the owners of the bank. Over time, as you pay down the mortgage, your net worth increases, with you gradually paying more of the tax as you come to own more of the asset.

So, yeah: the tax on capital would completely replace the property tax. In general Piketty wants everything to be more transparent and treated equivalently: stop allowing corrupt billionaires to hide their income in shady tax havens through questionable holding companies. Have everyone declare what they own and pay what they owe. Current tax code is largely accidental, based on what it was easy to do at the time (it's very easy to tell when someone's living in a house) or driven by emergencies (the United States and other countries charging extremely high income taxes in the mid-century). Even his progressive tax on capital isn't an end-all solution. Ultimately, Piketty wants to establish democratic control over the economy, and have the power in the future to debate and decide how they wish the economy to grow.

Phew! I imagined the above summary being just a couple of paragraphs, guess I got carried away. ANYWAYS, there's some stuff I want to talk about, starting: now!

I found myself thinking of The Battle for the Soul of Capitalism often while reading this book. Bogle and Piketty are coming at this from very different directions: Bogle is a captain within the financial industry with a fullhearted and unexamined devotion to the principles of capitalism. Piketty is an economist examining the economy from the outside with a nuanced and critical view of capitalism. Both of them are very alarmed by the trends that they see: skyrocketing executive compensation, financial shenanigans, a widening gap between rich and poor, fraying of the social safety net. Their views on compensation are interesting to contrast. Bogle sees managers as villains, people who have betrayed the trust placed in them by the company and looting the shareholders' well-earned gains for their own benefit. Piketty refers to this class as "supermanagers", and to him they're... maybe more like antiheroes. Managerial income does come from labor, and does not depend on an inheritance, existing wealth, or even (necessarily) social class or family status. Yet, their compensation is completely unjustified, far outside the value a reasonable observer would believe they generate for the company. Piketty sees a coming struggle between the dynamic new supermanagers and the static old heirs, and can't cheer for either side. It's a bit like watching Alien and Predator fight: it's compelling, but humanity won't be well served by the victory of either side.

Bogle just sees the supermanagers as decreasing the (capital) payments to shareholders. Piketty also sees them in the context to the payments made to labor. Looking more closely at the capital share, I think the underlying question and the potential point of difference between Bogle and Piketty lies in who owns that capital. If it's widely distributed, as it may have been when Bogle was getting his start in the 1950s (with shares primarily owned by dentists and architects and pension funds), then the supermanagers are stealing from the pockets of the middle class and should be condemned. But if the capital is concentrated in the hands of the elite, as it was during the gilded age and will be again in the future, then the supermanagers are drawing down the fortunes of the 1%. Which... I dunno. In a war between millionaires and billionaires, I guess you cheer for the millionaires? Maybe?

Of course, another significant difference between Bogle and Piketty is that Bogle is American and Piketty is French. We both share democratic traditions and free-market economies, but have rather different institutions, histories, and attitudes. Piketty addresses some of those differences directly (via ever-helpful graphs and tables), and it also underlies a lot of his thinking and criticism. For example, he quotes often from the Declaration of the Rights of the Man and of the Citizen, which holds a similar power over the French mind as the Declaration of Independence does over the American. I don't think it's a coincidence that "liberty, equality, fraternity" resonates slightly differently from "life, liberty, and the pursuit of happiness".

Particularly near the end of the book, Piketty writes a lot about "democracy regaining control over capitalism." This sounds reasonable (democracy is good!), but what this really means is a whole society democratically deciding what to do about individual fortunes. Americans in particular seem likely to ask, "Why should anyone else have any input into the use of my money?", and I suspect that the American populace in general will be more resistant to this kind of development than Europeans, for ideological rather than self-interested reasons.

Piketty briefly touches on a continuum of "deserving" money. Nearly everyone would agree that if someone stole money, they don't deserve to keep it: the state can rightfully confiscate the entire amount. If you happen to just find money lying on the ground and grab it, it doesn't seem "earned", and it seems more reasonable for you to share some. Then there's money that you received as a gift and didn't work for. And finally there's money that you earned through your own labor, which almost everyone feels is the most "deserved" ownership.

I think that Americans probably lean more towards the earlier side of the continuum, with almost any non-illegal source of income honored, while Europeans (including Piketty) lean more towards the latter, with income that you didn't personally work for seen as at least partially a public rather than a private resource. And that difference is fine! Piketty's real point is that we need to have a democratic (and not a plutocratic) debate about this. Currently, citizens are almost totally disengaged from "boring" tax policy debates, leaving the influence to people like Michael Bloomberg and Sheldon Adelson who drop millions of dollars on electing the Senate and then have significant say over economic policy. Once the plutocracy is sidelined and a more representative legislature debates, we'll still end up with national differences, due to our distinct cultures and priorities and characteristics. Piketty notes in passing that American marginal productivity is consistently about 20% higher than French productivity, presumably because it's in our character to work harder and enjoy life less. That difference will help drive our tax code: how much we need, what we spend it on, how richly to reward entrepreneurship versus investing in education. Having differences between nations seems useful: they can become laboratories of democracies and economies, not unlike how states within the US can try new policies and other states can observe the results.

Adopting an annual tax on capital seems like a very tough sell in America, but the more I think about it, the less exotic it seems. As noted above, the property tax already serves as a (limited, unequal) form of a wealth tax. Another interesting analogy is the severance tax that American states charge on the extraction of natural resources: it doesn't serve the same purpose or cause the same effect as a tax on capital, but I think its justification is somewhat similar. Extracting resources from the land requires labor and capital and effort, and the enterprise does justify earning a profit; but the extractor did not put the oil in the ground. At a broad level, natural resources belong to the entire nation. It seems reasonable to pay the nation (via our agents in government) for using our natural wealth. That's also a potential way to think about a tax on wealth, especially inherited wealth. You didn't create that wealth by yourself, and your father didn't invent it out of thin air. The fortune relies on the public sphere we've built over centuries: the creation of markets, a class of monied consumers, a skilled workforce, a common currency, transportation networks, and so on. By definition, those who have accumulated wealth have profited from the system, and it seems eminently fair that they help sustain it.

And, ultimately, it's in the best interest of wealthy scions to help sustain that public system. Piketty's real concern in this book isn't so much a permanent plutocratic class; he doesn't see the endgame of no action as being an enduring dictatorship of the top 0.1%. Such an extreme inequality will, in his view, inevitably lead to violent social conflict: he fears another French Revolution, another Bolshevik uprising. It isn't exactly Marx, though. Because of how capital accumulation works, he doesn't welcome the revolution: once the new regime takes over, the process will begin all over again. The only way to break the wheel is to yoke the oxen of capitalism to the control of democratic government. We need its dynamism and its growth, but must curtail its extremes, because left to its own devices it will cause great division and misery.

I've done some light Googling while looking up statistics for this post, and in the process have stumbled across quite a lot of criticism of this book, much of which seems to miss the point. Piketty is pointing out the problems on the horizon, as growth in developed economies slows and as taxes on capital are further cut. Saying "Newly wealthy people are being created now!" isn't surprising: Piketty's point is that by the end of the 21st century, a lifetime of highly-paid work won't accumulate as much as inheriting a fortune that started growing in 1950.

Reading various peoples' opinions about the source of inequality reminds me a lot of peoples' opinions about the cause of the Civil War. A low-information outsider will have a naive understanding: "Slavery caused the civil war." "Poor people don't have enough money, so we should raise the minimum wage so they can earn more money." People who are interested in the subject sneer at those naive opinions. "Well, actually, the Civil War was caused by industrialization / the cotton gin / states' rights / whatever." "Well, actually, raising the minimum wage will just cause people to lose their jobs, IDIOT, the right solution is to abolish the minimum wage and cut taxes on job creators." And then the experts who actually study the topic for a living weigh in. "No, the Civil War really WAS caused by slavery." "No, if the minimum wage is sufficiently far below the average wage, you can safely raise the minimum wage without any increase in unemployment, and in the process slightly slow the process of capital concentration."

For the most part I found this book incredibly persuasive, but there are a few aspects that left me curious at the end. (To be fair, some or all of them might be addressed in the endnotes, most of which I skipped.) One thing I wonder about a lot is how shocks fit into long-term trends: are they subsumed into those trends, do they modulate the magnitude of those trends, or are they truly unique events that stand apart from those trends? During the roughly three centuries that Piketty mostly focuses on, there was one huge negative shock (WW1+Depression+WW2), and one seemingly non-repeatable positive windfall (expansion into the American continent). He doesn't spend a whole lot of time in the 0-1700AD era, and (convincingly) summarizes what happened in general during that time: no productivity growth, almost no population growth. But, of course, if we did have detailed data for that era, we wouldn't see a smooth and unbroken 0.1% population growth for those 1700 years. Events like the Black Death and wars would have been incredible shocks at the time: the Black Death probably killed from 30%-60% of Europe's population in just a few years. So, it seems like if we omit the Plague, the actual population growth rate must have been above 0.1%. Is it possible that the long-term trends of the past produced numbers closer to what we observe today? If we successfully prevent future pandemics and future wars, will higher growth rates naturally follow?

Should these sorts of shocks be included as part of long-term trends (as Piketty presumably does) or treated as unique events (as he handles the early 20th century)? The 1914-1945 shock seems like a once-in-history event, but I wonder if it is. Consider the turnover of capital in England following the Norman Conquest, or really any major conquest or plague event. In the best case scenario, the "natural" growth rate is higher than the historical values Piketty observes, which will automatically help mitigate the accumulation of capital thanks to β = s / g, even though it won't solve it. On the other hand, those kinds of wars and natural catastrophes probably also helped break up capital accumulation. Lands were confiscated after conquests, aristocratic families died out with no heirs, duchies were devastated by famines or plagues. So, one possible outcome of fewer future shocks might be greater overall prosperity and slower accumulation of capital, but even greater concentration of that wealth into even fewer hands, as past wealth continues to grow uninterrupted by man or nature.

And that's the other thing about Piketty that's worth thinking about: are we worried that specific dynasties will grow unabated (the Rockefellers, the Waltons, the Rothschilds)? Or is the threat that the superrich class will continue to grow even superricher, but we'll still see movement in and out of that class across generations? Near the end of the book I found myself thinking of the old phrase about "a fortune is lost in three generations"; of course, since this book is so data-driven, I'm now very curious if that's just folk wisdom or if there's hard data behind it. It may be overstated: "rich dude loses his fortune" is a more compelling story than "rich dude keeps fortune", so we may hear a disproportionate number of stories about losses. And, again, we're emerging from a very specific historical moment in which capital was devastated and many fortunes lost, but the presence of very real examples in our recent past does not mean that it will be a natural state going forward: the more quickly capital grows and the greater advantage conferred upon existing large fortunes, the more difficult it becomes for even a spendrift failson to completely squander it.

But if that old saying is more or less true, and dynasties tend to naturally end, we get a more dynamic picture of wealth. New fortunes are created, endure for a few generations, then disperse, as the upper class slowly shuffles its membership over time. That's still an inegalitarian picture, as real and immense benefits are bestowed upon undeserving heirs (not all of us get the opportunity to fritter away billions), but it feels less apocalyptic than the other scenario of ever-increasing elite patrimonial lines. Ultimately, though, that distinction doesn't really matter that much on the scale of an individual human lifespan. As Piketty notes elsewhere in the book, even a short-term trend can last decades, and it's small comfort to a person harmed by that trend to know that it's only "short-term." The difference is really interesting for the completeness of the picture, but the salient fact is the presence and acceleration of inequality.

For the most part I was interested in this book as a theory and as a means of understanding today's economic and political debates. But I have to admit that part of my brain was thinking about what this meant for me and my personal profit$: like a lot of middle-class-ish Americans, I've accumulated some of my own capital over the years, and of course I'm motivated to grow it. This sort of came to a head during Piketty's analysis of university endowments, which is awesome but was also personally worrying. Basically, by comparing the returns of hundreds of American universities, he shows a clear and consistent correlation between endowment sizes and rates of return. The wealthiest universities with the largest fortunes (Harvard, Yale, Princeton) have the highest return on their investments, and that return steadily declines along with endowment size.

For the last 15 years, I've adopted the gospel of John Bogle: you shouldn't try to beat the market, just own all of it. In the big scheme of things, the entire market earns the average return. For everyone who places a winning bet, someone places a corresponding losing bet, and you can't know in advance which is which. The one thing you can control is your costs, so instead of trying to beat the market, you should invest in low-cost indexed mutual funds and buy the entire economy.

Well, the university analysis puts the lie to that seemingly-reasonable syllogism. Spending more on wealth managers and financial analysts does lead consistently to greater returns. Granted, this isn't relevant for me: I'm not even worth the <$100 million bottom endowments that make do with meager 6% annual gains, let alone the vast sums that earn 10%. But in breaking down the reason for this divergence, Piketty reveals that "owning the market" does not mean exposure to or capturing all of the gains. Harvard's highly-paid investors have access to unlisted stocks and private equity funds and mineral explorations. By definition, when I own the publicly-traded stock market, I have zero exposure to those private, unlisted, off-the-books ventures. The public market may reflect the economy, but it is not the economy.

Bluntly, indexing can't match actual growth. When you stop and think about this, it intuitively makes sense that the most talented, motivated, and connected people will seize limited opportunities for themselves: snapping up shares before they're officially offered, for example. Let's suppose that this represents the top 10% highest-performing assets. That leaves the bottom 90% of assets available for everyone else to compete for. It's within this diminished world that the standard advice of "you can't control returns, only expenses" kicks in.

So, what's my takeaway as a greedy wannabe capitalist? It doesn't change my strategy. As Piketty points out, the high absolute expenses required to achieve above-average growth only make sense when it's a small fraction of the total size of a fortune, and, uh, I ain't going to be there any time soon. But it does make me more pessimistic about future returns. The earnings available to bourgeois investors will always lag the real earnings of the entire economy, after the elite have taken their share. And that gap will continue to grow as capital continues to concentrate: larger fortunes grow even larger, supermanagers amass their own pile, and the patrimonial middle class is left to scrap over an ever-shrinking slice of the pie.

Yay! So, yeah. I really like the note that Piketty ends the book on. As he sees it, capitalism poses real and incredibly difficult challenges. They are solvable, but will require an extraordinary amount of political will. That may seem impossible on its face; but 80+% income tax rates would have seemed impossible in 1910, and not only were they accepted after the great depression, they helped power America through 50 years of unprecedented growth. This book has already accomplished Piketty's goal of launching a democratic conversation, and I suspect this debate will continue for much of my remaining life.

Wednesday, September 19, 2018

Beach Reads

I kind of vacillate between this blog being a record of all the stuff I've read / played / whatever, and just being a pressure valve for when I have something in particular I need to get off my chest or I want to work through some ideas. In the earlier days of this blog I would occasionally put together round-up posts that minimally checked the boxes for media I'd recently consumed. This is something like that! Mini spoilers on each topic below.

I've continued working my way through two fun real-world-but-also-science-fiction-y series. The first is the Company by Kage Baker. I previously wrote about In the Garden of Iden and Sky Coyote, and just finished Mendoza in Hollywood. Mendoza is a wonderful protagonist, and it's really cool to see her continue to mature and adapt to her role. She's nowhere near as cynical as Joseph, but is slowly moving in that direction. This novel was especially interesting because it felt much more focused on Company employees, unlike the first two which (as I recall) paid more attention to the natives. We're getting a better sense of the very broad range of personalities among the Immortals and their various goals and quirks. I'm also really digging the development of the overarching mythology. This series had very specific rules laid down from the very start, and we're now getting more and more indications that those rules aren't as absolute as they once seemed. It's a long series and I'm not in a particular rush to get through it, but I'm getting more intrigued the further I get.

Also, as promised, I'm continuing to make headway in Charles Stross's Merchant Princes series. The writing gets better and better with each book, especially the dialogue, which has been getting more natural while still being fun and snappy. My favorite aspect, though, is the gonzo approach to plot. The stakes keep on getting raised to higher and more ludicrous levels, with (mega spoiler) interdimensional weapons of mass destruction and the recent revelation of Dick Cheney as the latest grand villain. The characters are a lot of fun too: the supporting actors can seem a little thinly sketched at first, but across multiple novels they've had plenty of opportunity to grow more complex and endearing. But Stross also doesn't have any hesitation about killing off beloved characters for dramatic effect. The most frustrating thing about these books is their cliffhanger endings, which are really egregious even for thrillers. I'm slightly tempted to wait until the series is officially over before going any further, but may not be able to hold out, we'll see!

A few months ago I played and loved Butterfly Soup. I didn't give it its own post... it's pretty clear that the game wasn't created for me, and I don't think I have much of value to say about it, but I thought it was incredibly charming and thought-provoking and kind of inspiring. Min in particular is an incredible character, and I couldn't help laughing at almost everything she says: she's a tornado packed into a tiny human body, throwing all of her passion and fury at anything that gets in her way. It's especially great to see how the game interface can uniquely enhance her presentation: little touches like the way the screen shakes whenever she speaks do a lot to enhance her surreal qualities, and is a wonderful use of this medium.

(End spoilers!)

It'll probably be a little while before my next media post. Continuing my recent nonfiction reading on economic topics, I just picked up the famous Piketty book on Capital in the Twenty-First Century. I'm pleasantly surprised at how readable and engaging it is: I was expecting a more dense financial tome, but it's clearly written for a general audience, structured very clearly, with patient and welcoming language. It's also been a fun surprise to see so much attention paid to plots and characters from novels by Jane Austen, Honore de Balzac and other 19th century novelists. Still, it is a long book and much less of a bedtime read than Stross or Baker, so it'll take some time for me to finish.

Saturday, September 15, 2018

Olly Olly

Wow, Oxenfree is a great little game. It's close to my Platonic ideal of a video game: short enough to complete in a few sessions, interesting mechanics that feel like they're designed to enhance your experience rather than blunt your progress, vivid characters, interesting choices, an intriguing but not overly dense mythology, sweet soundtrack, and distinctive visual style. Oh, and not too expensive, either!

There are a lot of things to praise about this game, but the element I'm thinking of most now is its conversation system. It's the most naturalistic, free-flowing experience I've had in a game, and feels a little like being in a Wes Anderson or Robert Altman movie: characters interrupt one another, leave thoughts hanging, correct themselves mid-sentence. It's close to how people actually talk: sentences aren't polished, meaning accrues in the dialogue, and conversation is at least as much about strengthening relationships as it is about exchanging information.

Mechanically, the system works a little bit like dialogue in Ladykiller In A Bind. Dialogue just happens around you, and at some point it might become appropriate to respond. Options pop up, and you can click on one to proceed. You might interject and cut off the other person, or wait for them to wrap up their thought before adding your own, or just let the moment pass and have them continue or fade into silence. Unlike Ladykiller, this all happens in real-time as you hear the spoken words: generally you have time to think over and consider, but in some of the more intense situations you might blurt something out because you don't have time.

My favorite thing, though, is that this all happens simultaneously with all the rest of the gameplay. As in real life, conversations happen while you're walking with someone, or when folks are milling around waiting for something to happen. The most memorable scene for me occurs near the beginning, when you and some other people are hanging out around a bonfire on the beach. There's a great, long, ongoing discussion that twists and veers into some deeply personal territory; while it's going on, though, you might be exploring the beach, or grabbing a beer from the cooler, or tossing stones into the ocean, switching between activities at will. There's... an air of distraction, I guess, that's deeply appealing to me.

Oxenfree does kind of have the "look" of an indie game. It isn't pixel art, but the characters are small and not very detailed, with each person having a major distinguishing feature. The backgrounds have a painterly style, accompanied with some gorgeous modern lighting effects. The overall effect is beautiful and homey and slightly eerie. The animations are particularly good: even simple actions like walking downhill carry a nice weight to them.

And, the music! The game as a whole but the soundtrack in particular reminds me of a Boards of Canada album, which is a huge compliment. There's sort of a low-key synthwave feel to much of the ambient music, which is then complicated by and supplemented with the fantastic lo-fi warblings coming in over your transistor radio.


Possibly because I recently finished playing The Longest Journey, I've been thinking about what defines something as an "adventure game". Oxenfree doesn't have what used to be the defining characteristic of that genre, an inventory: there are no objects to collect or combine or use on the environment. Instead, other than walking around and choosing dialogue, the main mechanic is an innovative one: a tuneable radio. At any point at all in the game - while in motion, while talking, whatever - you can whip out the radio and start twisting the dial. This has gameplay mechanics in a few places: you might hear some relevant information, or trigger a feedback loop in your environment. But it also casts an enormous environmental shadow over the entire game. You might pick up fragments of an old noir radio play, or a numbers station, or a big band, or an old Fireside Chat. This all contributes to the sense of being slightly out of time, of multiple generations collapsing on this one island, as well as a slightly uncanny sense of being both connected to and separated from the rest of the world. You can hear, but not speak; you may receive warnings but be unable to interpret them; or you may recognize that someone else is in danger but be unable to alert them.

All this takes a while to get going. The game isn't long, but it also doesn't rush things, and spends ample time easing you into its world before the strangeness starts to creep in. Along with the dialogue, the heroine Alex was my favorite part of the game. She's a predefined protagonist, and the game drops you into the story in media res, responsible for voicing her and making decisions before you know her whole story. You pick up on context clues, learning as much from the dialogue choices available to you as what other characters say to you, getting the knack of her personality while simultaneously getting a chance to steer it.

Often, after delivering a line of dialogue, thought bubbles will appear over other characters' heads, showing your own face or that of another character. I still haven't figured out exactly what this means: specifically, if it always means that their opinion of you has improved, or if it can also indicate disapproval, or if it just means that they're thinking of you (or whoever is pictured).


I was really excited early on when I thought that the game might include romances: there's an early game of FMK that sets your mind thinking along those lines, and several lines and choices along the way that seem like they might support it. Sadly, it looks like that isn't the case, at least not for Alex. Which is totally fine - it isn't what this game is about, so it doesn't need to have it - but I couldn't help feeling a little regretful for what might have been.

I did get to experience being kind of catty and petty, though. During the time I thought romance was possible, I set my sights on Nona, which put me in an awkward position with Ren. I did everything I could think of to keep them apart: I asked Nona for her opinion of Ren, took her disinterest at face value, urged Ren to back off, kept Nona and Ren from hanging out at the comm tower, didn't talk up Ren, didn't tell him that her birthday was coming up. And they still got together! Per the ending, apparently it's possible to keep them apart, but damned if I know how. It shouldn't bother me - I actually do, in the abstract, like the idea of a romance that doesn't revolve around the player character - but it felt sort of weird to have so many lines of influence that seemed to be guiding an outcome, just to have them all fail.

ANYWAYS. None of this is what the game is about! I loved the gradual reveal of the island, finding the truth about what happened to the submarine, the deterioration of the "ghosts", all that good stuff. It strikes that line between science and mysticism in a really wonderful way. I tend to hate attempts to conflate the two, which usually involves hand-waving or fake-outs, but this story was just deep and complex enough to pull it off, striking a note plausible enough for me to buy in.

The circular Finnegans Wake-esque structure of the game also seems clever and potentially fun. Thus far I've only finished an initial playthrough. I'll probably give it another whirl at some point, but am decently happy with the ending I got, so I'll likely wait a while for my memory to fade somewhat.


I know, I know. There are a lot of indie games out now on Steam, and no way everyone can play everything that's critically acclaimed or whatever. Oxenfree stands out as particularly good, though, and minute-for-minute is one of the best games I've played this year.

I have an album for the game, but I've totally given up on getting it up here after spending nearly an hour fighting with Google. One of these days I'll set up Flickr or something and finally post the six or so albums that have been languishing inside Picasa. I'm sure everyone is riveted by the prospect of finally seeing them.

Saturday, September 08, 2018


One of the best, most unexpected gifts this year has been the podcast R U Talkin' R.E.M. RE: Me?, a sort of sequel to the hilarious U Talkin' U2 To Me? Scott and Scott had briefly floated the idea of an R.E.M. 'cast in a late episode of the earlier U2 series, and I had quickly seized on it as a fantastic idea, but as the years passed I assumed that it would never come to fruition. But lo and behold, they did it, dropping a fantastic series of eps in their comprehensive and encyclopedic compendium of all things R.E.M.

The new 'cast has the same general format at the old one: most episodes include a full walkthrough of a single album, with the two hosts discussing their opinions of and thoughts about each song, but mostly talking about inane and hilarious unrelated topics. The overall feel of the two series ended up being quite different, though. The U2 cast was bonkers, the hosts frequently got really punchy, and it usually devolved into a delightfully silly mess. The R.E.M. cast felt more like a hang-out show: there was more nostalgia, insights into the hosts' lives and dreams, and a strong sense of warmth and rapport. Both shows are great, but I think the R.E.M. tone is what I needed more now in 2018.

The background for the shows are also rather different. Scott and Scott were united in their love of U2, and while they definitely diverged on details, they shared the same context for almost everything: the historical tours, the media events, the reaction to each new record. The R.E.M. cast was a bit closer to the original Analyze Phish, with Scott often in the role of resident skeptic while Scott tries to express his love for the material. Unlike with Phish, Scott actually had a strong connection to early R.E.M., which I think makes Scott's job both easier and harder than Harris's. There's a bit of an "in" since there's already affection there, but Scott has also gone through that "I knew them BEFORE they were cool" phase that leads him to feel like he's already considered their later work and written it off. That said, he gamely devotes himself to the project, often listening to albums for the first time, and finds gems along the way. At the start of this cast, I never would have predicted that Scott would enjoy Reveal but not Document. That still blows my mind. Even when he dislikes things, Scott puts in the work, analyzing what isn't working for him and whether it could be fixed. You hear a lot about sequencing, track selection, production, mixing, and other elements that go into albums but are rarely discussed.

Of course, I'm much more in alignment with Scott, as we both have a fierce, protective love of this band and its music. Neither of us were early adopters: Scott started listening around the time of Eponymous, while I started around New Adventures. We both stuck with the band into their final years and found a lot to love in their later records. This podcast was delayed for so long in large part because Scott was afraid that Scott would make fun of R.E.M. and hurt his feelings. And... well, that happens, especially near the end. The last couple of episodes were actively painful for me, as Scott picks up an incredibly annoying habit of mock-singing along to tracks that he dislikes. It drives me nuts when people do that in real life, and was one of the least pleasant things I've listened to on a podcast. Er, I mean to say, it's EFFING RUDE! I started to wonder if Scott had deliberately been on good behavior for most of the show to keep Scott from bailing, and finally felt free to loosen up and let his disdain flow once it was all in the can. But, I think the overall dynamic still helps the show, as I can cheer on Scott's defense of these songs even as I sympathetically cringe at the hurt in his voice.

As with the previous cast, they occasionally devote an episode to a non-album topic, and also often invite on guest stars to share their own love of and journey with R.E.M.. There are some real gems here. David Wain in particular stands out: he played in an R.E.M. cover band as a young'un, and it's thrilling to hear those ancient recordings. I was a bit surprised to find that the guest I most identified with was Haley Joel Osment. He and I actually started listening to the band at almost exactly the same time, although I was (er, am) nearly a decade older. For both of us, going back to the IRS records was like archaeology. It's honestly fascinating to see someone who has favorite tracks from Monster, but of course, that makes perfect sense. One idea the show returns to over and over again is how music is intensely personal and fundamentally biographical. Everyone's favorite songs will be the ones they heard at formative times in their lives, and you can't (and shouldn't!) argue with their love.

Oh, and the Todd Glass episode is every bit as amazing as you would hope. If you only listen to one ep, listen to that one.

The show wrapped this week, at least for the time being. As with the U2 cast, they may reunite for one-off episodes in the future if anything new happens. Given that R.E.M. broke up seven years ago, it's less likely there will be news there... but I noticed that just this week an enormous never-before-released selection of their performances will come out from the BBC, so who knows? We should also be getting at least one episode with their Christmas songs. For now, though, Scott and Scott closed with lists of their favorite R.E.M. entries. There are few things I enjoy more than ranking R.E.M., so I'll gladly take this excuse to play along.

  1. Green
  2. Automatic for the People
  3. Murmur
  4. Up
  5. Lifes Rich Pageant
  6. Accelerate
  7. Document 
  8. New Adventures in Hi-Fi
  9. Collapse Into Now
  10. Reveal
  11. Fables of the Reconstruction
  12. Out of Time
  13. Monster
  14. Reckoning
  15. Around the Sun
I know, I know, it's heresy to have Reckoning so low. In the past I've placed it above Monster. For me, personally, the songs on Reckoning are so forgettable: there isn't anything I especially dislike about the album, but nothing on it (except for Harborcoat, I suppose) motivates me to listen to it. By contrast, Monster has a bunch of songs I actively dislike, but also several that I actively enjoy listening to. Overall, I think this time my ranking was more influenced by how many great songs I can identify on each album as opposed to the average quality of songs. That especially helped Up, LRP, and NAiHF, and hurt Fables and Reckoning.

I didn't include Chronic Town (it's an EP) or Dead Letter Office (it's a B-side collection).

Next up, favorite tracks. I really like the idea Scott and Scott had to make separate Top Ten lists for each of three major eras of music from the band, partly because that's an interesting way to think of it, but mostly because that lets me choose 30 tracks instead of just 10.

I.R.S. Era
  1. Perfect Circle
  2. Swan Swan H
  3. It's The End Of The World As We Know It (And I Feel Fine)
  4. Flowers of Guatemala
  5. Feeling Gravity's Pull 
  6. Oddfellows Local 151
  7. I Believe
  8. Old Man Kensey
  9. King of Birds
  10. Shaking Through
  1. World Leader Pretend
  2. I Remember California
  3. Find The River
  4. Sweetness Follows 
  5. Leave
  6. Revolution
  7. Orange Crush
  8. Low Desert
  9. You Are The Everything
  10. First We Take Manhattan
  1. Sing for the Submarine
  2. Hope
  3. Accelerate
  4. Houston
  5. Discoverer
  6. Saturn Return 
  7. Walk Unafraid
  8. Blue
  9. Alligator_Aviator_Autopilot_Antimatter
  10. Chorus and the Ring

Their division makes the most sense: it's mathematically clean, with 5 albums for each era, and built around major milestones, of record labels and band members. But, personally, I'd be tempted to move Document into the middle portion and New Adventures to the final, as I think that's more sonically cohesive: Document has the big and well-produced anthemic sound that defines their early Warner records, while New Adventures kicks off their period of artsy experimentation and electronic instrumentation that dominates their later years.

Total Career
  1. World Leader Pretend
  2. I Remember California
  3. Perfect Circle
  4. Swan Swan H
  5. Sing for the Submarine
  6. Find the River
  7. Hope
  8. It's The End Of The World As We Know It (And I Feel Fine)
  9. Accelerate
  10. Houston

While the middle era contains my overall-favorite songs, I had the hardest time whittling the final era down to 10. There are a lot more songs on Up that barely missed making the list, and could easily be defended for top 10 overall.

Finally, a couple of lists of my own:

Least Favorite / Most Overrated (controversial!!)
  1. Country Feedback
  2. Wendell Gee
  3. Mr. Richards
  4. Shiny Happy People
  5. Binky the Doormat (great title, though!)
  6. Star Me Kitten
  7. Tongue
  8. Hairshirt
  9. The Worst Joke Ever
  10. [Insert your favorite song here]
I'm not including instrumentals, B-Sides, novelties or covers in the above list.

Favorite Music Videos
  1. Imitation of Life
  2. Talk About The Passion
  3. Turn You Inside-Out
  4. Losing My Religion
  5. Bad Day
  6. Lotus
  7. E-Bow the Letter
  8. Blue
  9. Finest Worksong
  10. Drive (starring Adam Scott!)

For funsies, I took a shot at sequencing (!) my top 30 tracks into a Spotify playlist, clocking in at a grand total of 2 hours 5 minutes. Here it is! (Note: Spotify doesn't have First We Take Manhattan, so I substituted my #11, Monty Got A Raw Deal. Seems apt. Also, I'd trim the outro to Shaking Through if I could, but it sounds fine as-is IMO.)

And here's the same (almost) playlist on YouTube:

I don't  have as much experience with resequencing as Scott or Scott, so this was a fun challenge. I front-loaded the higher-energy and more upbeat songs at the start, which isn't all that representative of this playlist but feels like a good way to begin (in the begin). It quiets down before gradually segueing into the dark, weird, ominous songs that I most love. There are a lot of those, so I broke them up into a couple of sections, interrupted by some more optimistic tracks. "Hope" starts the transition into the end, leading into a series of especially pretty and reflective songs that close out the playlist.

I'm sad to see this podcast come to an end. Not as sad as I was to see R.E.M. break up, but still. I'm glad that there will still be a few episodes to look forward to, and even more glad that I can pull out these albums and listen to them whenever I want. They are still growing on me after more than twenty years, and going on this journey with Scott and Scott helped me find even more new ways to love them.

Edit: For no particular reason other than me having some free time on my hands, here's how my favorite 30 songs are distributed across their 15 albums.
Murmur: 2
Reckoning: 0
Fables of the Reconstruction: 2
Lifes Rich Pageant: 3
Document: 3
Green: 4
Out of Time: 0
Automatic for the People: 2
Monster: 0
New Adventures in Hi-Fi: 2
Up: 2
Reveal: 2
Around the Sun: 0
Accelerate: 3
Collapse Into Now: 3
Non-album tracks: 2

Friday, September 07, 2018

This is the tale of The Longest Journey, and I will tell it in my own words, just as Funcom told it to me

Phew! True to its name, The Longest Journey is one of the longest adventure games I've ever played. One of the best, too! It recaptures what I loved about the adventure games I grew up playing: the excitement of exploration, the heady thrill of a lightbulb going off as you finally see the solution to a puzzle, the warmth of meeting a variety of quirky characters and becoming involved in their lives. It also taps into the elements that I've come to love in more recent years: nuanced relationships, a sense of community, positive representation, and an awareness of social issues.

That's no mean feat given how old this game was: it was released in the final weeks of the last millennium, and was one of the last successful old-school big-budget adventure games. It was created by the Norwegian studio Funcom, outside of the Sierra/LucasArts duopoly that dominated the industry, and I don't think I ever even heard of it despite its critical and commercial acclaim. A few years back I played the last entry in the series, Dreamfall: Chapters. I loved those games, and have been looking forward to playing these prequels for some time now.

Before getting into the game itself, some quick technical notes:

This game is fairly ancient (older than Baldur's Gate II!), and I was pleasantly surprised by how well it ran on my computer. Over more than twenty hours of gameplay, I didn't run into a single crash or freeze or game-breaking bug. That said, it belongs to that awkward early generation of 3D games, which have aged much less gracefully than even older sprite-based games. Textures are blotchy, models are rough. On the plus side, the character animations are surprisingly well-done and hold up great, and the voice acting is so phenomenal that it leads me to forgive almost all flaws.

It runs out of the box on Steam without any mods or patches, but feels like it's barely scraping by. It automatically resizes the monitor resolution to run, and disables Steam Overlay and other elements I've grown used to having. It also janks up the system fonts, so if you notice any problems after exiting the game, re-enable ClearType in the Windows Control Panel. The lack of Steam Overlay means I wasn't able to take any screenshots during the game, so please excuse their absence in this post; I borrowed a few illustrative examples from other sources.

Overall audio quality is good, and the voice acting is fantastic, but there are occasional pops at the start of some audio clips, which is especially distracting when they loop. Fortunately it's very rare, but happens most often in areas near the start of the game.

The one straight-up glitch I noticed was that some characters have textures that are completely missing, so some parts of their bodies are see-through. I don't know for sure what causes this, but I suspect that these were originally pure-black 0x000000 textures that on modern graphics cards are being treated as 0x00000000 instead of 0x000000FF. Fortunately this only affects a few relatively minor characters and wasn't too distracting.

Despite the glitches, though, the art design is insanely good. Every scene has fixed camera angles, with some of the most interesting and artistic layouts I've ever seen. One scene might have an enormous tower that fills the foreground, while you're a spec in the distance, running your way across a deserted parking lot. One is shown through a security camera, with timestamps and frame overlays silently documenting your intrusion. 

Heh... one thing I didn't realize until I was nearly halfway through the game is that you can run somewhere by double-clicking. I happened to discover it during the one puzzle where you're required to move quickly before a timer expires. Up until then, I'd actually really enjoyed the slow, almost languorous pace of the game. It takes time to walk from place to place, but it felt nice, like I was soaking in the ambience of these imaginary worlds instead of racing from one location to another. It actually reminded me quite a bit of Life Is Strange, which similarly deliberately strives for a more laid-back feel for the game. I might have declared my love for The Longest Journey when I realized that you could sit on a bench and just relax there for a while. There's no reason to do this, no in-game motivation, but it feels great to take a break and watch the world go by.

To reiterate, The Longest Journey is an old-school point-and-click adventure game, which is part of the lineage but fundamentally different from the modern choice-and-consequences adventure game. The gameplay is largely oriented around finding clickable areas on the screen, interacting with them, collecting items, combining items, and finding where those items can be used on the screen. It's been quite some time since I've played this style of adventure game, and I feel like TLJ is an especially good example of the form. Most puzzles are well-designed, things you can mentally work through and anticipate a solution, as opposed to desperately trying every possible permutation. One especially good technique the game uses is providing hints when you're close-but-not-quite-there for a solution: instead of just failing to accept something, April will speak a line like "Hm, I need to X this Y before I can use it to Z." That gives a much more graceful progression through puzzles than the impenetrable walls of failure that made the genre infamous.

All that said, there were a handful of times that I gave up and needed to Google a solution. I rarely felt bad about that afterwards. One particular frustration stands out in my mind: there's a fair amount of dialogue in the game, more than in LucasArts games and a lot more than in Sierra games. You'll sometimes have an available prompt like "What do you know about the Dodecahedron of Verisimilitude?", which will lead to a long and engaging explanation. After that you'll see a new prompt like "Remind me about the Dodecahedron", which lets you know that you already explored that line of inquiry and lets you get an abbreviated response that just recaps the most relevant information. Except, in one particular case, asking that "Remind me about..." question causes the other person to share additional information, which is necessary in order to proceed.

As a whole, though, the puzzles generally felt fair and interesting. The dialogue was great, too. I don't think much of it is required to finish the game, but I happily explored every piece of it that I could. The worldbuilding is fantastic, both the big-scale metaphysics of the game and the small-scale relationships April has with her family, friends, and new acquaintances.

Unlike Dreamfall Chapters or other modern adventure games, there really aren't any significant choices or consequences. There might be one or two cases where you can make a decision that has some roleplaying significance for the protagonist, but it never leads to a branching plot line or anything. That would have been cool, but it also doesn't feel like the game needs it... the story is fully compelling on its own terms, even if it does technically run on rails.


At the top of the list of reasons why I love this game, April Ryan is one of the most likeable protagonists I've played as. An aspiring painter who fled an abusive rural home and is scraping together a new life in the big city, she combines courage and determination with a strong streak of humility, loyalty, and groundedness. She has ambitions and desires, but is also very aware of managing her budget and supporting her friends.

As with Dreamfall Chapters, the game is broken into a series of chapters; a continuous plot runs through the whole thing, but each chapter can be a bit more focused on its particular environment and puzzles. Unlike DC, you keep the same protagonist throughout, and don't necessarily switch between worlds at the end of each chapter: the transitions are tied more to major story beats.

The early chapters were probably the slowest and wonkiest part of the game. I enjoyed them, but I think the game really gets going on your second trip to Stark. Before this time, you're mostly wandering around without much of a goal, trying to find things to do. After this, though, you start taking on a much more heroic role, which feels much more earned and resonant than almost any other game I've played. April stands toe to toe with the truly frightening Gribbler, uses her ingenuity to not only secure her own escape but also provide salvation for an entire community, and it feels really good to witness their happiness afterwards. I can't help contrasting this with, say, the classic King's Quest games, where despite supposedly being in charge of a kingdom it never felt like you were doing these things for anyone's benefit other than yourself and your family.

Again, the game is long, and the plot has ample opportunity for rising and falling action and reversals and revelations and evolutions. After experiencing the heady thrill of moments of triumph, it feels especially disenheartening when April makes a series of (required!) mistakes that bring misfortune on her and those around her. Nearly as bad as the consequences are the actions: April withholds information, lies to her benefactors, tricks her friends, all in order to accomplish something important but they make the failure feel even more abject: April hasn't just failed her mission, she's failed herself. But, it's exactly these sorts of story beats that make April so appealing. She berates herself afterwards, feels guilty, dusts herself off, tries to make amends, and keeps moving forward, a little wiser and a little more determined.

Random thought: I kept thinking of parallels between this game and Life Is Strange. I'm guessing that at least some of them were intentional, given how well-regarded this game is. I noted above that the overall pace and feel of the games are rather similar: you rarely feel pressured to rush to your destination and are encouraged to sit and enjoy the experience. Additionally:
  • Both protagonists are 18-year-old art students.
  • Both are set in Arcadia.
  • Both feature a journal/diary that's regularly updated with the protagonist's thoughts on recent developments.

There are many more thematic and story parallels, but those are more universal, while the above seem more likely to be deliberate homages.


Favorite character besides April, Stark edition: Fiona
Most annoying character, Stark edition: Burns Flipper
Favorite character besides April, Arcadia edition: Crow (he grew on me!)
Most annoying character, Arcadia edition: Abnaxus
Favorite map: So many great choices! I might go with the cave under the island.
Favorite chapter: Monsters
Favorite item: Constable Guybrush. (Close second: the flute. I love that you can play this anywhere!)
Favorite music: Maybe the tunes in the cafe?
Best villain: The Gribbler, though Gordon Holloway was also nicely menacing
Favorite lore: There's so much! I honestly glazed over for a lot of it, but the political history of Marcuria was really interesting.
Favorite outfit: Maybe her second Arcadia outfit (which is nicely echoed near the end of Dreamfall: Chapters) or her expensive clothes from upper Venice. I really love how her main Arcadia outfit gradually dirties and degrades over time., and it feels like a relief to finally change out of it.
Favorite animation: Speaking to Crow.
Favorite FMV: I was a little surprised by how back-loaded these were in the game. The first shot of going into orbit was really beautiful. The collapse of Roper Klacks' tower was also great and pretty funny.
Favorite line: "18 feels kinda like 17, only I can buy a gun and pilot a hovercraft."
Saddest event: Thinking that Zoe was killed


The Longest Journey was a very long wait - 19 years since its release and two years since I heard about it - but definitely worth it. I'm even more motivated now to press forward and play Dreamfall. It's nice to see that, despite the age and graphical limitations, the game holds up so well. It even holds up well despite me having played the final entry first: I have a pretty strong big-picture idea of what will and won't happen, but there were still many surprises along the way and plenty of moments to enjoy.

For better and worse, they just don't make games like this any more. There will probably never be a major adventure game that requires players to Google for the solutions to puzzles, just adventures where players Google to find out what decisions they should be making. TLJ/Dreamfall seems especially interesting because it's the only franchise I know of that has straddled both sides of that game design chasm, from its old-school origins to its modern conclusion, and I'm looking forward to seeing how Dreamfall helps span that gap.