Tuesday, February 25, 2020

You Work 14 Days And What Do You Get? One Kingdom Rank And 30BP In Debt

Some good news on the labor front: the Kickstarter union has been recognized! There is still more work to go, particularly their negotiations with management, but it's a very exciting development.

The immediate impact on me is selfish and silly: I'm ending my self-imposed boycott of the platform. And just in time, too! I've been staring regretfully at the Kickstarter campaign for Pathfinder: Wrath of the Righteous, the sequel to Pathfinder: Kingmaker, the game I've been obsessing about for the last several months. I haven't yet beaten Kingmaker, but am having more fun with it than I have with any recent RPG I've played, and was looking forward to supporting more of the same. And now I can!



Speaking of Pathfinder: Kingmaker: Dang, this game is huge! I'm now deep into Chapter 4 and have no idea how many more chapters there are to go. Any single Chapter could have been a perfectly satisfying RPG. The overall sense of this game isn't so much playing a big campaign: it's playing a series of campaigns. There's a really nice cadence to how things unfold: there's a large, complex, overarching plot that you follow for some time, dealing with factions and conspiracies and lore. You eventually resolve that, then have a few (in-game) months of time to focus on ruling your kingdom: appointing advisors, resolving political and economic issues, touring the land to chart your map and personally clear out stragglers. Then you rush back to the capital to attend to the Curse of Bald Hill, and soon after the next campaign starts. Most good CRPGs feel like a long campaign with a pen-and-paper party; PK feels like a series of campaigns, where you take periodic breaks while the GM plans your next adventure and then get back together again for another journey.


For this post, I want to focus on kingdom management, which might be my favorite aspect of this very fun game. I'm not really an expert, but have a much better handle on things, based on both my own experience and some focused Googling. I basically follow a priority queue of work. From most important to least, it is as follows.


Bald Hill events are the most important. These appear in your Journal under the Kingdom section, with a title like An Ancient Curse. There's a visible countdown timer here, like "The next development is expected in 237 days." That timer is accurate but misleading! About a month before it hits zero, you'll receive a warning to expect something in the next 2 weeks. Don't start any 14-day projects during this time. Exploring is fine, but be sure you can return to within your kingdom borders within a day. When you have ~14 days left on the countdown, you'll get an urgent Problem card that must be addressed within 1 day. For every day you ignore or fail the card, you'll get a significant penalty to your Kingdom (in my case, it was -2 points in multiple categories). I suspect that you actually lose the game if the timer goes all the way down to 0, so it would more accurately be phrased as "the final development" instead of "the next development."

At the same time that you get the Problem card, you'll get a quest to physically go to Bald Hill. This is a little less urgent than addressing the Problem card, so you can afford to Rest and stuff first. There is a very challenging fight here. Enemies dematerialize once you near the top, so apply any buffs before you head up. There are multiple waves and some very powerful enemies. Once you've both defeated the enemies and resolved the Problem, the chapter is officially complete and you'll head into the next phase of the game.


There are some things that will require your exclusive focus, like Bald Hill, but a lot of Kingdom things can be done in parallel. Highest on the priority queue here are other Problems, one of two card types that can appear in the Events filter. Problems will cause (mild but real) penalties if you fail them or ignore them, so, uh, don't do that. The phrasing on the card will say something like "This must be attended to by the 1st of Month XI"; "attended to" just means that you need to appoint an Advisor and start work on it, it doesn't need to be completed by then. All Problems (and Opportunities) expire on the first of the month. You'll almost always have less than a month to do it, but occasionally one will be due the following month. If you have no free Advisors for a Problem, check their current assignments and plan to bring them on before the Problem expires; if their current tasks complete after that, you should probably consider canceling less-important work to move them over, though so far that hasn't happened to me. When multiple Advisors are available for a Problem, my priority order is usually:
  1. The most-available Advisor (someone who doesn't have anything else they can work on).
  2. Severely under-leveled Advisors who need more experience. In this case I'll probably need to also spend some Crisis Points to raise their success chance.
  3. The Advisor with the highest natural success rate. This is partly based on their experience, but also their personal stats and Kingdom buffs you may have previously acquired.


Once all your Problems are being looked at, the next priority is probably claiming Regions. This takes 14 days for your PC, so check if there are any Projects you want to do (and can afford) in parallel. Always save before doing one of these 14-day things so you can reload if something terrible happens during it! There are a bunch of benefits to having Regions: It's a lot more economical to Rest in them while traveling (as your PC can acquire rations instantly and for free, freeing up your Hunters); you tend to get better random events while traveling (weaker enemies or peaceful encounters like merchants); you can access your Kingdom Management UI while traveling in lands that you own; and you can do construction in villages and region-specific Projects in parallel with doing other things (more details on construction below!).


After this, it's probably best to focus on your main quest. Each chapter has its own primary plot, which has a separate section in your Journal, such as "The Season of Bloom". It's nice to wrap this up soonish: If you go too long without solving it, you'll start getting more severe Problems. You'll also get tons of XP and loot and gold by following this plot line, and unlock additional Kingdom-related Projects and things.


Once you have annexed new Regions, be sure to establish villages. There are two schools of thought on this. Some people like clustering them close to your Capital, which cuts down on travel time and helps you complete the highly lucrative Artisan quests quickly. Personally, I've been placing them far away. This makes the Artisan loops a lot more time-consuming in the short term; but, eventually, you will unlock Teleportation Circles which allows instant traveling between Villages.


Inside your villages, you will meet your Artisans, which should be your next priority. Usually you will have a short initial mini-quest, then a task to construct their unique artisan building in the village, and then at some point in the future a more involved multi-stage quest to unlock their masterwork. Artisans may seem like a fun but minor feature; actually, though, they are hands-down the best source of equipment and money in the whole game. The in-game text implies that they cost your Barony money, but in fact, they generate it. Each month they will come and present you with a gift, with usually will either be best-in-slot for one of your companions, or, if you can't use it, something you can sell for a cool 10k or so gold pieces. So, prioritize getting these Artisans up and running ASAP so you can get that revenue stream flowing!


Keep in mind that you can convert GP into BP. At least in my game, I'm always short on BP. I'd say that everything above this point on the priority queue is worth spending GP on to build and do as soon as possible. For everything below it, wait for your BP to naturally build up over time. Also, as I noted in a previous post, you'll want to always keep your BP in the positive zone. Usually you can't spend below it, but you can go negative based on throneroom events and the outcome of certain Events. If you do go negative, you can immediately open the Kingdom interface and buy enough BP to get back up to 0; you won't suffer an Unrest penalty unless you carry over the negative balance into the next day. It's a good practice to always keep at least 100BP in the bank to avoid accidentally going negative, particularly while traveling outside of your Kingdom borders.


In practice I always assign Opportunities at the same time I'm dealing with Problems, though Opportunities are significantly less important; there's no negative impact if you fail or ignore one (and, in fact, I've sometimes seen Opportunities grant a tiny benefit on failure). Opportunities are by far the best way to raise your Kingdom stats: you'll always get at least +3 on a Success, and it isn't unusual to see +8 or increases for up to 3 total stats. This is free, costing no BP or resources, just some of your advisors' time (usually in the range of 7-21 days). I'll usually follow the same advisor prioritization as for Problems here.


Remember to periodically revisit your Advisor lists and see if the people you have assigned are still the best for the job. I almost always pick the person with the highest stat bonus. Whenever a Kingdom stat rises high enough to increase the associated rank, your advisor will present you with a dilemma and will lobby for a particular solution. I usually just follow their advice; mechanically, the difference between these is usually pretty insignificant. (For example, one option might give +3 Loyalty, another might give -1 Loyalty and +3 Economy, another might give 50BP.) On the rare occasion where one option has significantly better benefits and the Advisor wants me to do something else, sometimes I'll just choose what I want; I think that as long as you typically agree with them, they won't quit over the occasional disagreement. Other times I'll reload a previous game and swap out advisors to get someone more in line with my thinking, do the throne-room event, and then swap the original one back in.


Leveling up your Kingdom Ranks is important, but, at least so far, there haven't been as many opportunities as I'd like to do it. You need an unbroken 14-day stretch without any urgent business to attend to, and have the undivided attention of the relevant Advisor. This is particularly hard for the Economy rank, as there are a ton of Projects and Events that can only be handled by your Treasurer. So, whenever you get a chance to rank someone up, take it. These are the things I would personally focus on first.
  1. Bring Economy up to 3. This ensures you get the benefit from ranking up other stats.
  2. Bring Loyalty, Community, Divine, and Military up to 3. Each of these will unlock another advisor, which allows you to do more at once.
  3. Once you have an Arcane advisor, rank this up to 2 to unlock Teleportation Circles in your Villages, which is a huge help in moving around the map quickly. 
  4. After you unlock Relations, bring it to 3 to unlock Espionage and your Minister, which will probably be your last Advisor.
  5. Continue ranking up Economy whenever you have the opportunity. You want to try and keep this at or above your other stats to maximize your BP generation, and, as noted above, your Treasurer will tend to be in more demand and less frequently available for ranking up.
  6. Rank up the other stats when you can. I'm not yet sure yet what the best priority here is. You might want to focus on raising your lowest stats, so that all your Advisors can be equally useful in tackling Problems and Opportunities. But, from what I've read, you can unlock some massive bonuses once you reach Rank 9, so it might be worth rushing those. I will report back in a future post!


I was thrilled early in Chapter 2 when I saw the City Building interface for the first time. I absolutely adore the idea of playing Sim City inside my fantasy RPG, and it's evocative of other games with fun crossovers, like Fall From Heaven 2. I went on a bit of a building spree at the start, and, as I've since learned since, that was a mistake. Buildings are expensive, take time to build, and don't give great benefits; for example, building a Barracks will cost 30 BP, and gives a one-time increase of 1 Military point (not per-week or per-month: one, ever). Meanwhile, addressing a single Opportunity with your Military Advisor costs 0BP, will take about as long to execute, and will yield 3-8 points in Military.

That said, there are a handful of things worth building. In order:
  1. Artisan workshops. As noted above, these should be a very high priority, as they will be a primary source of revenue and gear.
  2. Once you have unlocked them, Teleportation Circles let you instantly teleport between villages. In my game, I unlocked Mage Tower before this, which has additional Arcane bonuses but is significantly more expensive, requires two open slots, and must be constructed in a Town.
  3. Bulletin Boards, if you are Lawful, give an impressive +2 to resolving all issues in this region.
  4. I don't think this is ever explained in-game, but in order to upgrade from a Village to a Town, you need to have a certain number of Villages and have have a certain number of buildings in the Village. I think you need 6 buildings (out of the ~10-12 slots available), but am not certain. Upgrading to a Town lets you build some new buildings that you can't construct in a Village, though most are still not worth building. Anyways, if you're trying to upgrade, I think it makes sense to lean towards buildings that (1) have synergy with existing ones, e.g. building a Tavern adjacent to Artisan Shops for bonus Economy; (2) are relatively inexpensive; (3) have synergy with each other or future buildings; or finally (4) raise your lowest stats.
  5. Once you have a Town, the Aviary reduces the time to resolve Events, and lets you manage your Kingdom from adjacent unowned regions.
  6. Upgrading an Artisan's Workshop theoretically can get you better offerings and increase the odds of them completing their masterwork.
  7. Hospitals, Stocks, and Courthouses all require specific alignments and can be expensive, but do provide bonuses to resolving Events.
  8. I don't think anything else is worth building, but maybe that changes in future chapters if BP is less tight and/or useful!

Everything below this paragraph is, in my opinion, significantly less important!


First, a word for Projects in general: they all sound cool, but you really need to consider the absolute cost (in BP) and the opportunity cost (in BP and advisor time). I'll break these down separately below.

Some Projects provide a buff to event handling: giving a bonus to resolving Events, granting bonus BP on issue resolution, etc. These can be worth doing.


Some Projects give you bonuses while questing. For example, one acts like a permanent Bless while inside your kingdom borders, another grants immunity to poison while inside your kingdom borders, another speeds up mountain travel everywhere. These are useful but not urgent; in particular, you'll probably spend less time fighting within a region that you've already annexed, so these buffs may be less helpful than they initially appear.


Doing Companion quests is good, but should usually be left to the down-time between other events. There isn't a timer or particular urgency for these, so you may want to wait until something else is bringing you in that direction. I suspect that you'll want to do these by the endgame, but the immediate impact so far has been relatively minor, usually just a little XP and loot. (Exception: If the text in the Journal says something like "We need to do X before it's too late!" then you should probably rush the quest.)


Back to Projects: If you are using a civilian (non-party-member) Advisor, like Jhod or Bartholomew, it's usually worthwhile to Train them to be better, which directly translates to better success rates on Events. Don't bother Training unassigned Advisors.


Errands are worth doing; these get a separate section in your Journal. Like Companion Quests, it usually makes more sense to wait until you're headed in a direction anyways. These tend to be pretty straightforward fetch quests with decent but not amazing rewards.


General exploration is also a good and fun way to pass the time. You'll typically only need to visit a half-dozen or so overworld map locations in the course of doing a main quest, and will pass near another dozen or so locations along the way. Personally, I ignore those while doing the main quest, then come back and do these later. It can be especially nice if you can claim their region before doing them, as you'll get some nicer buffs while doing them. There's an enormous range in sizes of maps: some are tiny with just a single monster and a chest; others are bigger than your capital and have merchants, factions, sub-areas and side-quests. And of course there are occasional storybook events, which are always pleasant surprises. Unlike kingdom management tasks, these activities will generate XP and GP for you and your party, which is important for leveling up and completing future quests. In aggregate, you can pretty easily get another level or two while exploring and clearing the various off-the-beaten-path maps. It's fun, too! It reminds me a lot of Baldur's Gate 1, sweeping back and forth across a zone, clearing away the fog of war, looking for cool monsters and interesting people.


And back to Projects again: Curse research should be a very low priority. From what I gather it's important to the end-game, but you shouldn't focus on it early. These projects are time-consuming, often 30-90 days long, and require BP, and will only grant a couple of Divine or Arcane points on completion; during that time, your High Priest or Magister could easily earn 15 or more points for free by tackling Opportunities. You'll eventually want to do them, but there's no rush, and you'll want to get to the point where you can easily afford to keep a critical advisor on the bench for multiple months.


A few Economics Projects offer discounts on constructing buildings, typically a 10% discount for a specific list. This looks and sounds good, but it's always fewer buildings than it seems at first glance (each variation is a building is listed separately, like both a Bank and an Andoran Bank). These Projects are relatively expensive, you would need to build a lot of buildings to break even on them, and, as noted above, you really shouldn't be building many buildings anyways.


Similarly, Trade Agreements are tempting, but are hard to justify. The math for these is simple: divide the BP they cost to sign by the BP per week they yield to determine how long you will take to break even and start profiting on them. Most of them take more than a year to start paying off! Which, to be fair, the game does take more than a year, but still. In addition to that you should be thinking about what other benefits you could have gotten for your 500 (or however many) BP during that time. I'll probably eventually do these, but they're a very low priority.

As noted above, each chapter really does feel like its own full-length self-contained RPG plot, so I feel like I should record my thoughts as I go along, lest I forget by the time I finish the game.

MEGA SPOILERS

I do really love how these plots are structured. Modern RPGs often lead with the big threat from the very beginning: "An archdemon is invading the land and must be stopped!". PK tends to be more of a slow burn that gradually reveals itself as you progress. Season of Bloom is a great example. It starts with some reports about monsters mysteriously appearing in the midst of your villages and wreaking havoc. After some more investigation, you learn that the monsters are actually bursting out of people. There's a multi-pronged research project as you and your advisors try to isolate exactly what is going on here: is it a mystical curse? Some sort of physical disease? After a harrowing surgery, you finally crack the case: the victims had all ingested physical seeds that lay dormant in their stomachs before sprouting into monsters.


There are some great decisions and skill checks along the way, and I'm curious how else it could have played off differently. In a previous chapter, I had reloaded a specific encounter multiple times to ensure that the evil wizard Bartholemew Delgado survived; he ended up joining my administration and was an invaluable help during this surgery. Without that, I would have needed to pass several high-level Lore: Nature and Lore: Arcane skill checks, and I strongly suspect that the patient would have died on a failure. Along the way you're mediating the well-intentioned disputes between Tristian and Jhod about the nature of the threat and how to address it.

The plot continues to develop, moving more like a wave than a straight line. Tristian helps you infiltrate a cult that seems connected with what's going on. There's a strong indication that goblins are behind the problem; you eventually learn that they are gleefully accelerating its spread, but are not the initial source. More skill checks come into play as you try to convince your lieutenant to do his job and keep order in your capital rather than rush off into a mysterious cave and try to solve the problem himself. (Recklessly exposing yourself to personal danger is the exclusive responsibility of the chief executive, not her cabinet!) Again, my personal Persuasion skills proved highly useful in achieving my desired outcome; from peeking at online spoilers, I would have otherwise needed to choose between the death of Kesten or Jhod.


Multiple threats are now bearing down on you simultaneously, with your capital under the active assault of erupting monsters, while a mysterious cave upstream is pulsing out more and more seeds. You must prioritize the threats and execute on them, all while under a challenging timer. Once inside the cave, you discover a portal to another world, the First World, the original source of all reality on Golarion; here there is an intriguing series of visions that hint at future plot developments and also illuminate some of your previous experiences with the Guardian of the Bloom. This all leads up to an exciting and challenging fight where you split your party in two and simultaneously destroy the Everblooming Flower in both worlds.


Difficult and interesting fights are a wonderful and consistent hallmark of this game. There are lots of trash fights along the way, which are quick and fun to play with in the RTWP engine. Once you near the end of the main quest, you'll need to remember that you've been collecting potions and scrolls and wands along the way, inspect your foes, adjust your tactics, swear a lot, reload and eventually triumph. It's fun!


Likewise, the Vanishing of Varnhold starts out with a mysterious and innocuous plot hook ("Nobody has heard from Magar in a few weeks, someone should check in on him") that ultimately builds up to a bonkers, fun, lore-heavy resolution ("The lich ruler of a millennia-old cyclopean civilization received the Eye of Abaddon from Hell and used it to imprison the souls of all smaller races who dared enter his old territory, and also Tristian is now a bad guy I guess?")

END SPOILERS

My one very mild complaint at the moment is that the main plot is sometimes a little too exciting, and I don't feel like I have as much time as I would like to devote to kingdom management stuff, which is less exciting but also deeply fulfilling. If only these extra-planar creatures would stop invading our reality so I could finally get back to the more important work of adjusting marginal tax rates and negotiating bilateral tariff agreements!

Friday, February 14, 2020

Go Directly To Jail, Do Not Pass Go

For someone who mostly reads science-fiction novels and plays fantasy video games, I've been reading an unusually large number of economics books. Retracing my steps, it started off with an interest in personal finance, migrated to studying how the stock markets worked, and recently has veered into political economy and income inequality. The latest and most strident book in this "series" has been Goliath by Matt Stoller. Its subtitle is "The 100-Year War Between Monopoly Power and Democracy", though it would probably be more accurate to say the 230-Year War, the 150-Year War, or maybe the 50-Year War.



This book has been a weird combination of compelling and infuriating. Compared to every other money-related book I've read, it is very personal and narrative in structure. Stoller doesn't write about abstract trends or forces: he has a cast of heroes and villains, hundreds of "characters" who are actual historic persons, famous or not, and the tale he tells is all about the individual choices people made and the effects they had: who created a policy and why, what effect that had on another person, how that influenced a later thinker, who tried to stop that policy. It's much more of a page-turner than I was expecting. But, it's also a book that I frequently wanted to hurl at the wall in fury. About half of the time that's because I was so mad with Stoller at the greed and stupidity on display. The other half of the time I was so mad at Stoller for the moral equivocation of his monomaniacal framing.

I have a lot that I want to write about this book and am having trouble structuring all of it. I'm planning to start with a summary of the book, then how I'm processing it in conjunction with other recent readings of mine, then why I think it'd bad and important, and finally how it relates to some contemporary political topics I've been mulling over recently.

The book starts with the founding of America, and specifically the famous Hamilton/Jefferson conflict between strong centralized power and weak dispersed power. Stoller continues the longstanding historic tradition (not the recent post-Miranda trend) of viewing Jefferson as a "man of the people," a champion of small independent farmers, seeking to break up concentrations of wealth and control. I'll have more opinions about this below! Obviously the 1790s don't map directly to the later concerns of the industrialized nation, but Stoller identifies the seeds of the coming battle: On the one side, a New York City-based, Wall Street-oriented, bank-funded faction seeking to grow larger businesses; on the other side a populist, small-town, entrepreneurial spirit.

Stoller moves relatively quickly through the early era of monopolization, the "trusts" that arose after the Civil War: the railroads, Rockefeller and Standard Oil, the Morgan bankers. I'd recently read about this era in Strike!, and it was cool to see it from another perspective, focusing more on how these corporations got to be so large and powerful in the first place. It's a dynamic that continues through the whole book: a new industry starts, lots of competitors jump in, someone raises a lot of money on Wall Street, buys out their competitors, raises prices, cuts service/quality, bankrolls politicians and the media, uses their dominance in one industry to establish beachheads in another, and continues. The vast majority of people end up losers: workers have their pay cut and conditions worsen, customers pay more for worse service, communities are shuttered or dilapidated, citizens feel outraged and helpless; the only benefit flows to the monopolists, who collect obscene profits and built permanent dynasties.

The book slows down a little and gets more detailed in the early 20th century. Louis Brandeis emerges as the great leading intellectual light of the antimonopoly movement, and a wide variety of politicians arise offering solutions to the problem. Pretty much all of these politicians are flawed for various reasons - again, I'll have more opinions on this below - but Brandeis himself is easy to root for. Brandeis's great insight was that the bigness of companies was itself the problem, and in order for markets to flourish, they needed to be broken up. Communist, fascist, and capitalist movements all took for granted that consolidation of industry was good and inevitable and that the important decision was who would run these large organizations and for what purpose. Brandeis had a uniquely American vision and goal: return to a system with many buyers, many sellers, all competing against one another in a fair market following democratically-established rules. The government should pro-actively keep companies from gaining an unbalancing dominance in their market, rather than wait for the consolidation to finish and a crisis to occur. Stoller never uses this phrasing, but I kept thinking of the old phrase "Power corrupts and absolute power corrupts absolutely." The goal of regulated competition was to remove the temptation to do evil, and eliminate the possibility of harm from an out-of-control and unstoppable force.

This period, maybe from roughly 1900-1935 or so, is one of the most intellectually interesting, with lots of competing philosophies, and I learned a ton about it. My shallow understanding had been that there was a "Progressive" movement, and I sort of lumped together all the opponents of Big Business into one group. In Stoller's framing, though, it wasn't so much a division between pro-corporate and pro-people; rather, it was a battle between Big and Small. As one major example, I tend to think of Teddy Roosevelt as being a progressive: a trust-buster who stood up to the giants of his day. As Stoller presents it, though, Teddy didn't object to the companies' size, but rather their behavior. He wanted them to be subservient to the government, to follow his plans for the country. This repeats over and over throughout the 20th century as a schism within the left/progressive/liberal side: on the one hand, followers of Teddy who like central planning, managed markets, national industries run for the benefit on the people; on the other hand, followers of Brandeis who want markets that are free but filled with small players, a government that sets the rules but does not direct industry.

This perspective was really interesting and leads to some (to me) unusual conclusions. There's a brief reference to the famed socialist Eugene Debs; as Debs devoted his life to fighting the same corporate villains as Stoller chastises, I was kind of expecting him to be lauded. But Debs, like all good socialists, believed (with Marx) that consolidation of industry was a historical inevitability, driven by ineluctable forces of efficiency. Debs didn't want to break up the railroads and other monopolies, he just wanted them to be run for the good of the workers rather than the benefit of the owners.

Of course, the US wasn't the only nation grappling with these issues. The specter of fascism looms over this era, and it's kind of creepy how close America got to adopting something very similar: a command economy, fusing together political, military and economic power. This, in fact, ends up being one of the more successful drivers for the eventual establishment of the New Deal and implementing something like Brandeis's vision. FDR and other politicians would eventually see diverse, decentralized economic markets as a key bulwark against political fascism, and intentionally crafted an American system that would resist the cartelization that IG Farben and other European firms established on the road to the Third Reich.

It wasn't an easily or quickly settled debate, and well into FDR's presidency there was still a powerful and active faction pushing for TR-style nationalization of industry. But managed competition eventually triumphed: in this setting, government is still an actor, but much more like a referee than a coach. It does act: it can legally block mergers, and can split up companies that have grown so large and powerful that they dominate their field. And sometimes the government will get more directly involved; one of the more interesting examples is the fight with Alcoa in the 1930. Alcoa had monopolized the aluminum trade, and, as the US started to get on a war footing, the military grew alarmed at the state of the industry: it could not produce enough aluminum to meet military needs, and they had grown complacent, slashing R&D and falling significantly behind European aluminum technology. The solution wasn't to nationalize Alcoa: rather, the government seeded competitors, providing capital and land and resources to highly-motivated entrepreneurs, and then signing favorable contracts that would support them as they ramped up production. This didn't just solve the aluminum shortfall, it also incentivized Alcoa to improve: to re-invest in its business, expand production, and actually get better instead of just collect on its dominant position. As a result, the American aluminum industry emerged far stronger after WW2 and would dominate for decades to come.

Throughout the late 19th and early 20th century, there was a constant yo-yoing: monopolies would grow huge, there would be a large financial bubble, the bubble would burst, the real economy would suffer, politicians would enact reforms, those reforms would be subverted or co-opted (as in the capture of the FTC by pro-business interests), monopolies would rise again, and the cycle would continue. This was finally broken by FDR and the New Deal. It was not easy! It was a long, decades-long struggle to bring giant corporations to heel, to embarrass the banks, to pass progressive legislation, to create a bureaucracy to carry out that legislation, to appoint a judiciary that would enforce the legislation. But, once it was in place, it was remarkably resilient. The boom-and-bust cycle finally paused and there was remarkable consensus across parties and generations. Even as late as Richard Nixon, anti-monopoly action was accepted as good. I'm not used to seeing Nixon presented sympathetically, and he's not exactly one of Stoller's heroes, but he does come off pretty well: Nixon's legendary bitterness was often directed against large corporations, and he's quoted as saying things like "I'd rather deal with an entrepeneur than a stuffed shirt at a department store" and "I'm not sure if we want to be a nation of supermarkets." Nixon wasn't a committed ideological adherent to antimonopolism, but his Justice Department vigorously prosecuted monopolies, and he saw these actions as being popular.

I tend to think of the Cold War Consensus as being all about foreign policy, of Republicans and Democrats agreeing on the importance of supporting western European democracies against the Communist threat; but there was an economic consensus, too: skepticism of banks, a "small is beautiful" ethos, a willingness to challenge concentrations of power. These weren't even controversial, political opinions, just technical details, like funding the military or collecting taxes. I suspect that at least part of the reason why the New Deal framework was so resilient was because so many people had lived through the Great Depression and never wanted to experience it again; they saw the New Deal as something that solved the problem and wanted to keep it. And, I suspect, it was at least partly due to that generation of people dying off that the New Deal consensus eventually dissolved and we got to where we are today.

Stoller's account of how it all falls apart is interesting. I tend to point to 1980, the rise of Reagan and trickle-down economics and the Chicago School. In Stoller's view, though, it was the left that destroyed itself, long before Reagan arrived at the White House. There was an interior, intellectual and moral rot that took hold within the Democratic Party, causing it to abandon its roots, alienate its popular base of support, and lose the Brandeisian legacy.

There are a lot of people Stoller points fingers at, but high on the list are public intellectuals like John Kenneth Galbraith. Several things started happening in the 1950s. The party grew increasingly under the sway of "eggheads", Ivy League-educated thinkers based in the Academy; in comparison with, say, President Truman, who had personal experience as a farmer and failed haberdasher, the center of the party drifted towards a more affluent, educated, white-collar leadership. The party grew increasingly elite, disdainful of its core membership. As monopolies ceased to be as threatening (since they no longer existed, or were thoroughly tamed), they were ignored, and leading thinkers once again fell under the lure of central planning. Mid-20th-century liberalism became a project of planned economies, of socialism. Big was no longer considered bad.

Of course, this wasn't happening in a vacuum: the Red Scare poisoned American politics and discourse, leading to widespread self-censorship and an upswing in Goldwater-esque conservatism. The field of economics stepped back from engaging with "political" questions, starting to view itself as a branch of mathematics or science rather than policy, intentionally removing consideration of values from its analyses. A nascent class of new billionaires, ironically funded by New Deal-era spending and protected by antitrust laws, emerged from the Texas oilfields and began funding right-wing academics and projects. This eventually organized around the Austrian and then the Chicago School of economics, led by Aaron Director and a network of like-minded academics and businessmen. But the struggle of the Chicago School against the New Deal regime took decades, and by the 1970s, their opposition had been hollowed out: not interested in defending the "small people," not recognizing any inherent problem with bigness, not viewing economic issues in general as particularly important.

Starting around the 1960s, there wasn't much economic ideology in either party, so individual behavior ended up seeming somewhat random. Nixon's Republican administration vigorously prosecuted IBM's computer monopoly and initiated the breakup of Bell Telephone. In the 1970s, Ralph Nader emerged as an anti-corporate crusader; but he was also reflectively anti-government and was not schooled in the history of the antitrust movement, and so the consumer-oriented movement he founded ended up unwittingly aiding in the dismantling of important antimonopoly systems because Nader didn't understand or care why they existed or how they worked. There is a real shallowness to the later years of this book that Nader helps exemplify: a group of self-righteous consumers demands that things be cheaper and more convenient. Businesses are all too happy to comply: they don't care about the prices they charge, they care about the profit they make. So consumer-rights groups ally with corporations to disable Fair Trade laws, to remove protections for workers and merchants, to encourage the growth of chain stores and monopolies. Workers get squeezed, or lose their jobs entirely as industries move overseas. And, in the long term, the consumers are defeated: with the rich variety of mom-and-pop shops vanished, they are not helpless against the whims of big retailers raising prices and slashing services, exactly what happened before the New Deal.

This is one of the subtle shifts that I hadn't thought about before. For most of US history, political economy focused on the citizen as a worker, considering a person in terms of what they can produce and contribute to society. For the "children of affluence," the post-WW2 generation, political economics started focusing on the citizen as a consumer, considering a person in terms of what they can consume and receive from society. This is a radical re-orientation, and obviously causes a host of problems. Why worry about your neighbor getting laid off, so long as you can buy a cheaper car?

It took me a while to put my finger on what the vacillation between monopoly and antimonopoly policy reminded me of, but I've finally got it: it's like the Old Testament stories about the Israelites. They're in trouble, God saves them, they honor Him and follow His laws, the nation prospers for a time; gradually they lose their way, grow complacent, stop honoring Him, and fall into trouble again. Reading scripture, it's very frustrating to see the loss of hard-won wisdom and the entirely predictable, inevitable consequences of straying from the right path. That's exactly the sense I got reading through Goliath: We've been here before, we know enough about human nature and finance to understand what's going to happen, we know how bad it can be, and yet we forgot our way, forgot our history, and so fell back into a completely preventable catastrophe.

It was really interesting to read about the technical details of how things unraveled. On the economic front, Stoller focuses on Walter Wriston, a hard-charging banker who rose to become the CEO of Citibank. Wriston invented the Certificate of Deposit, which I've grown up with and have always viewed as a benign, responsible savings vehicle; but the CD was specifically created as a loophole around New Deal banking regulations, particularly the prohibition against "hot money" (spending money to acquire deposits). CDs supercharged the lending system, allowing banks to leverage themselves and engage in riskier bets than they otherwise would have been allowed to take. A key quote comes on page 314, describing the economic system around 1970 once these new innovations had been accepted:

There was now one financial system for normal people, which was heavily regulated in the lending and borrowing one could undertake. There was another for big banks and corporations, who could operate in an unregulated land of exotic financial instruments, all backed by the Fed in the event of a crash.

That last clause is key. The Federal Reserve, originally invented by progressive reformers to bring big banks under the watchful eye of the government, had now turned a corner, implicitly guaranteeing to step in and protect large, private financial companies that had gotten into enough trouble to threaten the economy. We had now entered the world where profits are privatized and losses are socialized, where once again big banks could call the shots and the American people would suffer the consequences.

The book continues all the way through to the present day, and I increasingly recognized the names in the book as people I've seen on TV or read about in newspapers and not as figures from history. The Reagan/Bush administration undoes the New Deal, and Bill Clinton ensures it stays dead, lending bipartisan consensus to the folly of opposing monopolies. There are several pages on technology near the end which are really well-written. It's very concise, but I think Stoller gets everything right, down to the Homebrew Computer Club's sharing culture and Bill Gates' early efforts to commercialize and then monopolize software. Reading this belatedly reminded me at how viscerally furious I felt at the Microsoft monopoly in the late 90s and early 2000s, at the peak of my Linux advocacy. It's interesting how I haven't thought about it for so long. I think that at the time I viewed it as a single, offensive, personally-relevant thing; I now can see it in terms of a long tradition of monopolistic predation.

Reading about the economic and political disasters that have struck during my own lifetime is frustrating. In an earlier era events seemed to be driven by malevolence, like Andrew Mellon and Morgan colluding to enrich themselves with the corruption and complicity of public officials. Today, though, events are driven more by ignorance. George W. Bush didn't even understand what was happening when Lehman Brothers collapsed. Most of the Democrats under Obama had no understanding of the New Deal, and the few who did, like Robert Rubin, had built their careers on opposing it. Earlier generations had at least understood the struggle between centralized market power and a dispersed populist citizenry, so financial collapse was always followed by political reforms. After the 2008 financial crisis, though, both parties had the same underlying belief in big business, and took the essentiality of supporting financial markets for granted, so no reforms were done. (The only slight change was the creation of the Consumer Financial Protection Bureau, and even that was done to fit within the modern "consumerist" mindset of Nader and his descendants, rather than the worker- and citizen-oriented mindset of our predecessors.)

Okay! This is a long book and there's obviously a lot more (particularly more Andrew Mellon shenanigans), but that's a super-brief summary. Onward:

I thought a lot about Capital in the 21st Century while reading this. They aren't directly comparable, for several reasons. Stylistically, Piketty is very much based in data, with tables and graphs and charts, while Stoller is telling a story, with heroes and villains and plot twists. The timeline is different: both are especially interested in what happened before and after World War 2, but Piketty goes all the way back to 0AD and pays equal attention to many countries, including Germany and France and China and Britain and Japan, while Stoller is exclusively interested in the United States since its founding and particularly since the Civil War. And the scale is different. Piketty looks at the highest level, of the total wealth of nations, and at the lowest level, of how much wealth individuals hold. Stoller seems more interested in the midlevel: corporations, dynasties, specific industries and federal agencies.

That said, there are some meaningful intersections. I think their core argument is actually pretty similar: there aren't any natural laws that generate fairness or economic equality, and the mid-20th-century movement towards equality was largely the result of specific policies that were implemented in the West during that era. And, after those policies were unwound in the 1980s, vast accumulation of wealth (Piketty) and power (Stoller) resumed.

Capital in the 21st Century may be a little more pessimistic, as Piketty also argues that the postwar boom era was due to an incredibly unique intersection of circumstances (postwar reconstruction, technology advancement, a population boom AND progressive laws) that may not occur again in history. Stoller seems to imply (but doesn't flat-out state) that we could return to the good times of the 50s if we break the monopolistic chokehold on our democracy and return to New Deal-esque policies.

Stoller has a monomaniacal focus on bigness, while I don't remember Piketty making any particular arguments around the structure of the economy. It might be that Stoller's politics are a prerequisite for Piketty's economics: in order to reduce inequality, we will need to implement changes in our taxation and spending, but we won't be able to make those changes until we break up the power than monopolies hold over our government.

Once again, though, I think Piketty gives more reason for pessimism. If he is right, then equality tends to naturally increase as the economy grows, and decrease as it flattens (or declines). With that as background, there may have been natural forces at work that made it easier to implement some of the massive structural changes of the New Deal. Once again, Alcoa is a great example. There was a booming demand for aluminum at that time, and Alcoa couldn't keep up with all the demand that was out there, which made it relatively easy for the federal government to encourage competitors to start, and in doing so break up the monopoly. That would have been vastly more difficult, though, if growth had been stagnant and Alcoa could easily supply all the demand: simply starting competitors wouldn't have been enough if there wasn't unmet demand. So, as economic growth continues to slow in the coming decades, addressing monopolies in the 21st century may be significantly harder than it was in the 20th: governments will have fewer tools to address them, monopolies will fight harder to hold onto the existing pie, and there will be fewer natural openings in the market for new entrepreneurs.

And, I think the political and psychological dimensions may make it even more challenging to not just win reforms but to keep them enforced. FDR and his allies fought hard through the 30s and 40s to implement the New Deal, and that was followed by an unprecedented period of prosperity, which everyone could point to as proof that those reforms worked. But, if our economy is slowing now, then implementing those policies won't lead to a big boom: things will be fairer, more stable and more sustainable, but the actual size of our economy won't grow as much as it did in the 40s and 50s. Without as big and obvious of an economic reward, it will probably be more challenging to sell and sustain those policies over the long run, particularly since they will eternally be under assault from future would-be Mellons.

Not to mention that, as the economy slows and wealth and power are increasingly concentrated into fewer hands, it will get even harder to fight against those big companies... and, every year we wait, the harder it becomes to take them on. That's dispiriting!

All right, that's all stuff that's, uh, "good" about this book. As I noted before, though, I got pretty upset at a lot of what it does. I'm going to try and organize my thoughts here but they're probably going to end up sounding somewhat ranty, I apologize in advance for that.

One thing that this book has reinforced for me is that, while I increasingly want to view myself as a progressive, at the end of the day I'm probably a liberal. Those are terms that tend to get used and re-used and shift depending on your social circle and era, but in the current discourse, progressives are generally identified with the faction that wants big, structural change in our economic system, while liberals are more concerned with social justice and equality. Goliath is relentlessly a book about individual people making individual decisions, and at the end of the day I just can't make myself cheer on slavers and bigots, no matter how good their economic policy is.

It really is remarkable how, over and over again, the heroes and champions that Stoller identifies are people on the wrong side of history. Thomas Jefferson won office thanks to an image as a down-to-earth man of the plain people, but he was a slaver who owned hundreds of human beings, raped with impunity and lived a life of luxury and excess. Woodrow Wilson was a racist who segregated federal offices and screened Birth Of A Nation in the White House. Stoller's hero, Wright Patman, consistently voted against civil rights legislation throughout his career, opposed the integration of public schools, and supported the war in Vietnam.

To his credit, Stoller doesn't hide this dark side of his protagonists, and he duly notes their sins (though I feel like he does excessively airbrush Jefferson). In Stoller's telling, though, these are unimportant or irrelevant details that should not distract us from the enlightened wisdom of their economic plans.

It cuts both ways, too. Walter Wriston is one of the main villains of the book, right up there with Mellon and Bork, a prime architect of the financial trickery that will lead the country to ruin. And yet, Stoller concedes, Wriston also marked a break from the past. In a previous chapter, Stoller lauded the chastened bankers of the 1950s: men who were timid, boring, unintelligent. Banking was a profession where you would stash the wealthy and underwhelming scion of a local magnate. This was also a field that was universally staffed by Anglo-Saxon protestant men. Wriston, as part of his hard-charging ways, broke the mold, gleefully hiring Catholics, Jews, blacks, women: he liked all talent, no matter where it came from or what it looked like. Stoller explicitly decries the idea of a meritocracy, but never really gets around to defending his alternative. Once again, the advancement of gender and racial inequality is treated as an unimportant distraction, not meaningful in the same way that economic power is.

Of course, we need to do all of the above: make an inclusive society, promote both economic and social justice. We talk all the time about how the moneyed class uses racial tensions to divide and conquer the working class, pointing to racial minorities as bogeymen to undercut labor solidarity. But racial unity can also be used to distract from issues of money; this is most pronounced in the modern Silicon Valley monopolies, where companies like Google and Facebook are strong champions for liberal social issues like gay rights and invest real money and influence in advancing those causes, but also use those liberal alliances as a smokescreen to shield their greed from scrutiny and regulation.

Given all the above, I found myself morosely asking a question throughout the book: Why does it seem to be so rare for a politician to have been good on both social and economic issues? In the real world, at the end of the day we're eventually casting a ballot each November, and all too often are confronted by a choice between, at best, a racist warmonger with a progressive and populist economic agenda, or a tolerant champion of freedom and equality who will turn a blind eye to the concentration of capital. Stoller doesn't attack this question head-on in the book; my current, weak theory is that most societies will only tolerate a limited amount of change in a given amount of time. You can plausibly move the needle on economic issues, or you can plausibly move the needle on social issues, but if you try to change both then you start being identified as a radical or revolutionary, and can't win the popular support required in a democratic society to implement those changes.

Which isn't to say that there haven't been people who have called for both, of course. The very first name that came to my mind, who I think is completely missing from this book, is Martin Luther King Jr., who famously saw the struggle for racial justice, for improving the lives of poor people, and for ending the imperialist war in Vietnam as inextricably linked. And, MLK was assassinated for it. Stoller seems much happier with Wright Patman compromising on racist legislation throughout his career so he could keep getting re-elected and pushing forward New Deal policies.

There might be some parallels to draw with intersectionality. Intersectionality seems to be helping the left be far more effective now than it was in the 1960s, at least on the social justice side, as we now have a vision of a shared struggle where an advancement by any group helps every group, unlike the factionalized orientation of the 60s and 70s that saw justice as a limited resource and correspondingly fought to determine who was most oppressed and needed attention at the expense of others. It feels to me, though, like we're lacking that sense of shared struggle between the economic left and the social left. At least in my media feed, there's at least as much criticism about "identity politics" coming from the populist economic left as there is from the entirety of the right. I think that the alliance between economic and social leftists will be critically important in the near future. A lot of this stuff got raised very explicitly in recent weeks when Joe Rogan endorsed Bernie Sanders, which got a lot of people asking: Is it worth embracing someone with bigoted views if their support will help you achieve a bold economic agenda? To be fair, many victims of bigotry answered "Yes!" The intersection of economic populists and social liberals is a minority in the American population; the union of the two is a majority.

Throughout the book, Stoller implicitly denigrates the importance of gay rights, civil rights, racial rights, war and peace and so on, at the expense of economic justice. To be fair, this is a book about monopolies, so of course it's more interested in monopolies than it is about the civil rights movement. But it's an unfortunate consequence of the otherwise compelling decision to make this a personal book about real people and the real struggles they had, and makes it incredibly hard for me to get excited about the movements and people that he champions. I mean... having read the book, knowing everything that I know now about monopolism and the New Deal and the Watergate Babies and the Chicago School, if I was sent back in time to 1974, would I vote for Wright Patman? Hell no! Our country was responsible for over a million deaths in Vietnam, and for all the misery and injustice the return of monopolies has unleashed on America and the world, they still haven't murdered as many Americans and Asians as the policies enabled by Patman and his fellows.

This tension over Patman's legacy echoes similar tensions throughout the book. I think I (predictably) got off on the wrong foot with the very opening about the Hamilton/Jefferson struggle. I've been nursing an anti-Jefferson vendetta for over thirty years, and the pendulum has swung much more pro-Hamilton in the last few years, so overall I'm feeling much more charitable about pro-Jefferson, anti-Hamilton perspectives than when I was younger. Nonetheless, I'm still stunned that a wealthy plantation owner and slave-holder still gets lauded as the plain, common man of the people, while someone who was born into poverty and out of wedlock, who inherited no wealth, who repeatedly divested himself from lucrative opportunities for enrichment to dedicate himself to public service, still gets remembered as a figure of greed.

But, of course, Stoller doesn't generally care about personal biography, just about policy. Jefferson's hypocrisy doesn't bother him, and Hamilton's personal life doesn't interest him, just their respective policies. Which, fine, that's a fair perspective. That said, I got really upset and argumentative during the early chapters. Why was it bad for Hamilton to establish a bank, and good for Wilson to create one? Why was it bad for Hamilton to create new taxes, and good for Wilson to create new taxes? Why was industrialization bad when Hamilton was promoting manufacturing, and good when Wilson was building up pre-World War I arms manufacturing, or when FDR was pushing for more aluminum? Stoller is continuing a centuries-long tradition of painting Hamilton as the villain, the original satanic devil responsible for all subsequent ills in America, and it feels like he often takes Hamilton's badness for granted, seemingly arguing that a thing is bad because Hamilton supports it.

(Edited to add: Sorry, I just can't let this Hamilton stuff go! Late in the book Stoller creates what I think will be my new go-to example of whataboutism. After going for an entire book pretending that Jefferson's legacy of slavery is unimportant, Stoller abruptly announces that, actually, it was Hamilton who traded slaves! In his endnote for that claim he cites a blog post (!!) as an authority. This sort of moral equivalence really infuriates me. On the one hand, you have a man who famously owned hundreds of slaves and used the threat of torture and death to hold them in a lifetime of bondage to enrich himself, and who worked tirelessly to help enshrine the legality of chattel slavery into the founding documents of the nation. On the other hand, there are some contested allegations that Hamilton might have traded slaves, weighed against his well-documented legacy as a founder of the New-York Manumission Society and a lifetime of impassioned lobbying against slavery. Of course it would be terrible if Hamilton did trade in slaves, but acting like these two things are equally bad is just obscene.)

(And one more thing! One of the recent insights I've gotten into the Federalist mindset of Hamilton and Washington is the Newport Address, which laid out a dynamic by which a strong federal government can protect the rights of minorities. I tend to think of this system as helping religious, racial and gender minorities, but it's arguably just as applicable to protecting smaller businesses against the predation of giant monopolies. Everything that FDR did under the New Deal, fighting the banks and regulating monopolies and chastening corrupt businesses and implementing fair trade laws, rests on an expansive view of federal power, particularly the interstate commerce clause, which is exactly the view of government that Hamilton championed during his time in and out of power. If Jefferson were alive, his libertarian views of limited government would have ensured that private businesses would be free to pursue their goals without interference, even as in his own day he ensured that private plantations could continue chattel slavery without interference from the government. And that's all I have to say about that!)

All right, those were the things I disliked about the book! Finally, here are some muddled thoughts-in-progress on how I'm applying the book to the present day.

I've been reflecting a little on how to define and present my own personal political beliefs. Part of that is the above discussion about progressivism versus liberalism. Goliath's discussion about the changing meaning of the word "Liberal" has been very helpful to me, tracing its origins from classical liberalism through its New Deal incarnation and forward into the neoliberalism of today; I really like FDR's definition quoted here on page 202-203:
Roosevelt called himself "a liberal." This did not mean, as classical liberalism had meant in much of the previous era, protecting the rights of industrial barons using the rhetoric of self-sufficiency. It meant moral leadership, the willingness to address a civilizational crisis by updating the machinery of governance. A liberal, Roosevelt said, broke from the past, but not too quickly to provoke violence.

The struggle between liberalism and progressivism is important, but the more important division in this book is between populism and elitism. Populists are almost invariably the heroes of this book: down-to-earth men and women, independent farmers and small shopkeepers, and the politicians allied with them. I'm slowly recognizing what I think is an anti-populist (and, thus, pro-elitist) bias on my part: to some extent that's due to the past association of populist movements with nativism and racism, but I think it's deeper than that. I wonder if part of it might date back to my childhood when I was tagged as "gifted and talented" in elementary school; I definitely went through a long period in my pre-adolescent and teenage years when I proudly thought and said stuff like "Most people are too dumb to vote correctly!" and "People who are smart deserve to be rewarded for it!"

These days my conscious thoughts are much more egalitarian, but I think I still have a knee-jerk aversion towards purely popular movements. I'm much more comfortable engaging with an intellectual "egghead" framework, tend to trust the words of credentialed experts over man-on-the-street anecdotes, and carry some deep-seated misgivings that populist movements will slide into demagoguery and chaos.

One big point that the book makes, over and over and over again, is that it is the elite, educated, credentialed intelligentsia that frequently and easily falls under the sway of business and moneyed power, and so is often the lever that enables economic chaos. Just because someone is smart does not mean that they are wise, and most people aren't as smart as they think. (Including me!) One particularly resonant era is the mid-70s, with the sea change of the Watergate Babies and Nader's Raiders. The dominant attitude of that time was "The system is terrible, we need to throw it all out and start all over again!" And... the system definitely had problems, but it did a lot of good, and those people didn't understand their history (or their present!) enough to recognize that they were throwing out their babies along with the bathwater. It's very easy to connect that with the present day, with the general sense of disgust and distrust at the system, that has enabled the rise of Donald Trump and drives our daily politics. It's tempting to say "Things can't possibly can't get worse," but yes, yes, they definitely can.

How do we solve this in the future? Taking on the monopolies in the 2020s may be harder than ever, and how to we ensure that our descendants won't return to worshiping golden idols? My initial thought is that, in addition to political policy, we need to focus on culture and media, creating art and stories that communicate the threat to future generations even when they don't face an imminent threat. But, that's kind of what we did before: there's a rich heritage of powerful political cartoons from the 1800s, novels by John Steinbeck, plays by Brecht; those have all endured as works of art, but don't seem to have helped at all as relevant expressions of alarm.

Democracy can sometimes seem like a failed system for confronting monopoly power, as monopolies can all too easily buy politicians, fund think tanks, and otherwise use their wealth and influence to subvert policy. But I don't think the answer is to eliminate democracy; I'm tempted to think of a mechanism like Prop 13 that both closes the gate and makes it incredibly hard to unlock in the future; but implementing unchangeable antimonopoly laws doesn't seem like the best approach, we want something that's resilient instead of rigid, that can be flexible enough to adapt and meet the challenge of future Walter Wristons who create the next financial risk that none of us have considered yet. It's important to be clear and steadfast in our principals, while still allowing our system to grow and evolve.

I dunno, it's hard! I think there's an innate human tendency for future generations to want to do their own thing, to discount the experience of their ancestors, to swing the pendulum in the other direction. And the capitalist side can afford to be very patient and relentless, spending decades lying low and laying the groundwork, and then suddenly seize a six-month opening when a chink appears in the antimonopoly armor.

One silver lining is that there is now a lot more interest and attention being paid to high-level economic policy: not just battling over what the top marginal tax rate should be or the relative importance of entitlement payments and military spending, but wonky discussions over tariffs and interest rates. I have to confess that my economic thinking is often driven by my political leanings and not the other way around. For example, I've spent most of the Trump presidency grousing about the low interest rates at the Federal Reserve: decrying the obvious political interference over economic policy, and worrying that the low rates are further inflating an already-stretched bubble, buying a few years of illusory good times that will just make the eventual reckoning and collapse far worse. Goliath, though, repeatedly presents low interest rates as good in their own right: they help independent farmers and small businesses borrow to survive rough patches or (reasonably) grow, help state and local governments provide essential services at reasonable cost, and put fewer dollars in the pockets of the banks. This reminded me of a recent congressional hearing where Alexandria Ocasio-Cortez questioned the Trump-aligned Jerome Powell over interest rates; where most Democrats lambasted the Fed's acquiescence to political power, AOC extracted an admission that low rates do help grow the economy, and probably should have been lower before and for a longer period of time. Anyways, this is all a reminder that I should check my knee-jerk tribalistic responses and think more carefully about the impact of underlying policies.

As a tangent to the above: Stoller does spend several (righteously furious) pages covering the 2008 collapse and the subsequent bailout, but doesn't specifically cover the slashing of interest rates and quantitative easing, and I am a little curious about his thoughts on that. Throughout the book, high interest rates are treated as bank-friendly (which makes sense, as every dollar of interest is a dollar going to Wall Street), so I assume that lower interest rates are bank-unfriendly. But that seems a little weird: if Mellonism is back and Wall Street controls both parties, then why are interest rates still so low? I'm not informed enough to answer, but I found myself wondering if this also might be related to the repeal of Glass-Steagall. Now that all deposit-taking banks are also investment banks, they can profit from speculation in the stock market, and I suspect that the latter activity is a lot more profitable. One of the huge changes of the last 12 years has been the collapse of rates on personal savings (bank savings accounts, Treasury bills, etc.), which has led to a massive migration into the stock market (abetted by the GWB capital gain tax cuts), which has supercharged and probably inflated the market. As always, Wall Street profits enormously from this expansion, and will pay little or no price when it collapses. So, on balance, maybe they're fine with low interest rates, so long as they still get to capture the savings dollars that are now going elsewhere.

Much like the Federal Reserve, I was surprised that the book makes positive references to the Tea Party, noting their billionaire backing but also casting them as channeling genuine populist disgust at the banks. That kind of caught me off guard; in my memory, the Tea Party gained steam in response to the bailout of the auto industry, not bailing out the banks. But, based on my light research since then, I was incorrect: the immediate impetus behind the rise of the Tea Party was, in fact, the Bush/Obama bank bailout.

The end of the book segues directly into today and feels very relevant to the 2020 race, not least because Bernie Sanders and Elizabeth Warren get cameos in the closing pages. Warren comes off particularly well as a rare, effective champion of reform, and is specifically thanked in the (long!) acknowledgements; Sanders gets a much briefer but still positive reference for running a populist Presidential campaign in 2016 that resurrects the forgotten promises of the New Deal.

One immediate impact of the book has been prompting me to re-think some contemporary monopoly-related topics. Over the past year, Warren has been a particularly vocal trust-buster, with "break them up!" as her go-to solution to the bad actions of Silicon Valley tech giants. In the past I've appreciated the sentiment but haven't been particularly enthusiastic; there are a lot of different tools at our disposal, in addition to breaking up companies. For example, I would love to nationalize the monopolistic Internet telco providers like Comcast, Time Warner, and AT&T: I think we should run them at cost, for the benefit of the public, while ensuring access to all Americans, just like we do with the Postal Service and physical mail. In the past I've said that I don't see much benefit to seeing a lot of smaller Facebooks, but I do think that Mark Zuckerberg should be in prison, and probably Sheryl Sandberg too.

After reading Goliath, though, I do see the logic in breaking up companies like these, instead of nationalizing them or replacing bad actors at the helm. Social media is a particularly compelling case: having a wide variety of competing social media sites would do enormous good in diminishing the power of echo chambers, making our elections less vulnerable to internal manipulation and foreign interference, and limiting the spread of viral falsehoods. Managed competition could work very well in that industry. And ISPs might work better as smaller utilities rather than a federal agency, returning to state-level regulation of smaller and mid-sized providers; we definitely need more regulation there, not just managed competition (it's wasteful to run duplicate wires to the same dwellings), but keeping these entities small would reduce the risk of future consolidation and too-big-to-fail abuse.

Along the same lines, I've been thinking a lot about what we should do with PG&E here in California. I've been a big advocate of having the state of California take it over, and have preferred that approach over alternative proposals to split it up into municipal or smaller private power companies. I think that, like many of the eggheads in Goliath, I tend to view larger companies as being more efficient and productive; the cautionary message of the book, though, is that large entities can be inherently dangerous. In the future, a statewide PG&E could more easily be re-privatized and return to unduly influencing our elections (PG&E had a terrible record of using ratepayer money to fund ballot initiatives that helped the business and harmed the state). Keeping smaller (hopefully publicly-owned but maybe not) utilities might result in slightly higher rates than a unified statewide utility would, but it might also be more responsive to the needs of the diverse communities (rural and heavily forested regions have substantially different risks than densely urban environments), and even a private company might ultimately lead to a genuine sense of service and partnership with the community, rather than overseeing an empire to extract profits from.

The biggest topic in the Democratic primary thus far has been Medicare For All. Stoller doesn't really talk about health care in the book, other than briefly describing the merger wave that consolidated hospitals. This is another topic where I'm curious about his thoughts on the single-payer debate, given his monopoly-oriented perspective. On the surface, it seems like he would be opposed, and would prefer having multiple insurance companies competing against each other, rather than a single, centralized, command-oriented federal payer. Or maybe single payer would be fine, but he would prefer multiple providers, more like the Canadian system than Britain's NHS.

Other people have written about how the healthcare market is different from other markets, particularly when it comes to cost. Historically, having fewer insurers has been more effective at keeping costs down, as hospitals need to agree to limited payments in order to retain their customers; when there are many weak insurers, it is easier for hospitals to play them off against one another and extract higher prices. I'm curious whether health insurance is a specialized one-off case that breaks from the "big is bad" rule, or whether it follows the same principles that consolidation is bad.

Anyways, happy Valentine's Day!

Friday, February 07, 2020

Political Power Grows Out Of The Barrel Of A Blog

Hey-hey, it's 2020 let's vote! As usual California is making it easy to do so, with an all-vote-by-mail primary. There's a lot of attention on this election: it's a big presidential one with a competitive Democratic primary, and, unlike many other years, California is participating in Super Tuesday, so our votes may actually matter for once.



I am a little curious about how this race will play out. Many of the candidates printed on my ballot have already officially dropped out of the race, and many Californians will vote before results in New Hampshire, Nevada and South Carolina (and, heck, maybe even Iowa!) are known. Depending on how early folks mail in their ballots, people who have dropped out and endorsed other candidates may still end up with a not-insignificant number of votes. And of course California's generous election rules (ballots only need to be postmarked by Election Day and will still count even if received a week later) may make it hard for people to determine who "won" California.

But, that's what makes this all exciting!

Without further ado, here's who I'm voting for.

President: Elizabeth Warren

I've been kind of obsessing over this race for years; but filling out this ballot is a gentle reminder that my vote in other races matters far more. More than five million California Democrats will be weighing in on who should lead our country in Washington, DC; just a few thousand will be deciding who should set the policies that impact our daily lives far closer to home.

I'll cheerfully support any nominee to come out of the primary heading into the general election. I think that Bernie Sanders has it right: we need to stop thinking of politics as something that happens once every four years. Instead, we need a continually engaged public movement applying constant pressure through the political system in order to achieve meaningful change. The good news is that, while some candidates will head into that office with better policies than others, every one of them will be vastly more receptive to public pressure to do the right things. We'll just need to work harder on some of them than others... but that's what democracy is all about, and we need to recognize that the ball is in our court.

Country Committee: Nick Akers, Ashleigh Evans, Sandra Lang, and David Burruto

14th Congressional District: Jackie Speier

I've been increasingly impressed at her performance in recent years. The Bay Area has a stellar congressional delegation, and Speier doesn't seem as visible as members like Zoe Lofgren, Anna Eshoo, Eric Swalwell, Ro Khanna, Barbara Lee or Nancy Pelosi. But Jackie has been a great voice in the #MeToo era, and I'm proud to have her representing me on Capitol Hill.

13th Senate District: Sally Lieber

An actual competitive race for once! I spent longer researching this than all other items put together (though still just a fraction of the attention I've paid to the presidential race, of course!). There are lot of good options here. I'm voting for Sally Lieber, who has a bold vision that includes implementing a single-payer healthcare system in California. She has previously served in the Assembly and delivered big wins like a minimum-wage increase, so I think she'll be able to hit the ground running in the state Senate. And it's hella cool that she's picked up the local DSA endorsement!

22nd Assembly District: Kevin Mullin

1st District Board of Supervisors: Dave Pine

Prop 13 ($15B bonds for school construction): No

Ever since reading Capital in the 21st Century I've grown even more bearish on the government borrowing money to fund projects: it accelerates inequality by taxing the population and paying interest to the already-wealthy people buying muni bonds. We badly need to return to a system where we (gasp) tax ourselves and (gasp!) spend the money on things that need to be done. Unfortunately, California's past idiocy has made the more frugal and moral tax-and-spend vastly more difficult than the wasteful and immoral borrow-and-spend. Still, we need to stop this sometime, and I'm starting now.

Measure L ($385M bonds for school upgrades): No

See above. We need to repeal all of Prop 13, not least the asinine requirement for a 2/3 vote for local taxes. Bonds are Bad, Taxes are Terrific!

Now, let's grade me on how well I voted last time:

I grudgingly approve of the job Gavan Newsom is doing. I'll probably never admire him the same way I did Jerry Brown, but he's been more forceful than his predecessor on some important issues. I'm particularly excited by the pressure he's currently applying to PG&E, and am dreaming of a world where the people literally take back their power.

Xavier Becerra is killing it, too. Most of the headlines related to him are the "California Sues Trump!!" variety, but he's no showboat, and is working hard on local issues and implementations of law. I recently heard a great interview about how his office is gearing up to crack down on CCPA violations, and he's coming out swinging against Uber and Postmates in defense of AB 5. He's also using his office to slow or block the controversial selling of the .org top-level domain registry to a greedy private equity firm. More of this, please!

On a more sour note, I'm regretting my support of Feinstein over Kevin de Leon. She isn't terrible, but she's far from the best our state has to offer. I am glad to have Kamala Harris representing us, and look forward to a newer, more responsive generation of leadership.

I'm thrilled that Prop 6 failed! I think that really helps show how much smarter and better Californians are today than they were in the 70s: There was literally a ballot measure that asked "Do you want to lower your taxes?" and people voted "No" en masse. It gives me enormous hope for the future.

The Measure II failure kills me. 62% of residents voted to support it, and it still failed! We need to repeal Prop 13 yesterday. It is good to see that the city council is still moving forward and identifying funding, but geez, this dumb state.

And I'm correspondingly thrilled that Measure W passed. It needed 66.67%, and got 66.87%! This dumb state, but this great county, I'm proud of you. I've already seen first-hand some of the great improvements this has enabled: electric buses, the return of the ECR Rapid express service, and the return of the airport shuttle. Those last two services were eliminated during the 2008 recession, which blew up the county's asinine insistence on funding transportation solely through their general revenue services (see also: their shameful treatment of BART). As noted before on this blog, in an ideal world I would prefer progressive funding over a regressive sales tax, but sales tax revenues are far more predictable and less volatile than those based on Silicon Valley profit-sharing, and until we have a better system for smoothing out the spending from progressive income (or wealth!) taxes over many years, I'm glad that we'll have a solid sales tax to rely on.

That's that! On the whole I feel pretty happy with how things turned out in 2018, let's keep this party going!