Democracy (Yeah You Know Me)

As usual, the 2024 California ballot is a long one! I usually know out the gate how I'll be voting in the political races, but the propositions and measures usually take a bit more research. For future reference, here is how I am casting my vote!

President and Vice President: Kamala D. Harris and Tim Walz

Senator: Adam B. Schiff (ugh)

Senator Again For Some Reason: Adam B. Schiff (still ugh)

US Representative: Kevin Mullin

State Senator: Josh Becker

Assembly Member: Diane Papan

San Mateo County Board of Education: Maurice Goodman

Proposition 2 (bonds for schools): Yes

Proposition 3 (constitutional right to gay marriage): Yes

Proposition 4 (bonds for water projects): Yes

Proposition 5 (lowers required local votes for housing bonds to 55%): Yes

Proposition 6 (abolish forced labor in prisons): Yes

Proposition 32 (raise minimum wage): Yes

Proposition 33 (allows local rent control): Yes

Proposition 34 (revenge for Prop 33): No

Proposition 35 (medi-cal funding): No (I actually like what this would do, but it should be handled by the legislature, not a proposition)

Proposition 36 (repeal Prop 47, re-felonize most thefts): No

Measure J (Millbrae elementary school bond funding): Yes

Measure FF (Expand city council term limits from 2 consecutive to 3 consecutive): No

I have increasingly mixed feelings on our top-two primary/election system. I feel like early on it was really effective for shaking up ineffective but entrenched Democratic incumbents, and let to much more dynamic and competitive elections. In recent years, though, at least at the statewide level, the (usually centrist) Democrats have come up with an effective playbook of elevating marginal Republican candidates who can't win in a general election, so they can coast to an easy victory instead of competing against another Democrat who has a shot. The Harris/Sanchez and Feinstein/DeLeon races were actually interesting, while Schiff/Garvey is not. I increasingly think that ranked-choice with instant runoff is the way to go.

For better or worse, the fall elections can be simplified quite a bit thanks to candidates running unopposed in the first round or (for some races) a candidate winning by a huge margin and skipping the "runoff". Just a reminder to vote in every election to make sure that your vote actually counts, and to see the candidate(s) you'd like to see!

I'm taking a bit of a chill-pill in this election on my standard "vote No on Bonds" principle. I don't really have a great reason for that, more just a general feeling that these are worthy enough projects to overcome my dislike of bonds.

I am feeling a slight amount of relief at casting my vote early, but obviously still have plenty of angst to spare between now and the election. Living in California and the Bay Area, there aren't many competitive races or measures to focus on. If you're like me and have some extra bucks that you'd like to send to a good political cause, I recently started using Oath. This gives a good way to find down-ballot races throughout the country, races that are spending thousands instead of millions of dollars and where your donations can make an outsized impact. They have a pretty nice interface where you can filter by causes you're most passionate about (like climate change, gun safety, mental health, etc.) and specific states. You can donate to specific candidates, which I generally like more than giving to committees and organizations. (The great thing about Oath is that they only focus on competitive elections, so you aren't tempted to waste your money on high-profile but hopeless challengers to, like, Mitch McConnell or Marjorie Taylor Green.) And unlike a lot of other platforms, Oath doesn't share your email address with the candidates, which helps cut down on inbox spam.

So, yeah! I have lots of Thoughts and Feelings about this election, but probably nothing that would surprise long-term readers, so I may or may not write that up in a separate post. I hope everyone stays safe & practices good self-care during this intense time!

Spar

Nicola Griffith has become one of my go-to authors: as soon as I hear of a new book from her, I know I'll pick it up. Not necessarily on Day One, but I immediately look forward to reading it, and avoid any reviews, summaries or other information that may color my initial reading.

 

In a bit of reverse chronology, I finished reading Spear (written in 2022) after Menewood (written in 2023). I think that in my mind I had somewhat conflated the two: they're both set in England near the middle of the first millennium and (as usual for Griffith) feature awesome lady protagonists.

MINI SPOILERS

They are pretty different, though. Menewood, like Hild before it, is a doorstop of a book, while Spear is much briefer at just around 150 pages. Both books feel anchored in their historical moments and geographical places, while also inviting in a sense of mysticism: but in Hild/Menewood that mysticism is itself grounded in history, and we can see both the secular origins of mystery and the effect it has on peoples' minds; in Spear, the magic actually is real, and the novel slowly grows in the direction of myth and legend.

It took quite a while into Spear for me to get a bead on the question of "is magic real or not". The protagonist is initially nameless, just known as "the girl" or "her." Eventually, she wins a name for herself: Peretur, referencing her self-trained skill with a spear. She has special qualities from the start of the novel: able to calm animals, to sense changes in the weather. Later on these become increasingly special and uncanny: during a duel in a stream, she recognizes by a movement in her opponent's eyes that there is a root hidden beneath the water, and she is able to avoid stepping in it. It isn't until nearly halfway through the book that we realize she can have actual visions: seeing things far away, or that nobody else can see: not merely heightened senses and keen perception, but a real sixth sense, combining telepathy and divination. This isn't a magic to hurl fireballs or call down rain or compel men: it's a magic that makes her the best at things other people can do.

Unlike Hild, who had great wisdom and carved out a unique role for herself as a "freemartin", protected by her boldness and strangeness, Peretur cloaks herself (literally and figuratively) in a man's garb. She wants to be a fighting companion of the king, and no woman can do that, so she presents herself as a man. Since this is more of a fantasy, she probably could have succeeded without the ruse, but it adds a really great layer to the story. The narrative always refers to Peretur as "she" while the dialogue usually uses "he". I kept half-expecting her to be found out, but that doesn't really happen: a few others do learn, but only when she chooses to share with them.

MEGA SPOILERS

It's great fun to discover, surprisingly far into the book, that this is a reimagining of one of the Arthurian legends. We start to hear of King Artos, also called Arturus; later on we meet Llanza, Gwenhwyfair, Myrddin and others - all very Welsh, obviously. Peretur herself turns out to be Sir Percival, who discovers the Holy Grail.

One of the things I liked best about this book was how, when you learn new things later in the book, they illuminate things from earlier in the story. One of the biggest examples is the bowl: one of Peretur's earliest memories is the black, decorated bowl that her mother Elen used for water and cooking. Much later, we learn that this bowl is one of the four great treasures of the Tuatha: her mother stole it from Manandan, one of these godlike creatures, as revenge and payment for her captivation. I'm pretty sure that this is the same item as the Cauldron as depicted in Lloyd Alexander's Black Cauldron; in this book, it's one and the same as the Grail as in the Quest for the Holy Grail. And this bowl/cup/grail/cauldron is the source of Peretur's great abilities: the bowl confers immortality, and by casually drinking from it from a young age, Petetur has absorbed god-like abilities.

As with many of Griffith's other novels, this one features an excellent romance. There's a sweet casual-ish connection between the young Peretur and an innkeeper's daughter that in some ways reminded me of Hild's "bed games", simultaneously sweet and no-strings-attached. The main romance is between Peretur and Nimue, Myrddin's apprentice and captor. Once again, there's a unique spin on the classic mythology here: Nimue is once again a young woman who learns sorcery from Merlin and eventually imprisons him: but in Spear, Myrddin is a manipulative jerk, stealing Nimue's power while pretending to grant his to her, and shaping her into an accomplice to help seize the Tuath treasures. Rather than a betrayal, her imprisonment of Myrddin is an act of justice. Anyways, Nimue is understandably wary of Peretur: her magic, her power, and, as we eventually learn, her kinship with Myrddin. But they work through this and secure a really wonderful relationship.

END SPOILERS

The book also includes an afterword that I found really interesting, describing Griffith's long interest since childhood in these kinds of stories, the various historical and literary antecedents of the tales, and how she as a writer found her way into this particular novel. That raised a few connections I had missed while reading the book but that make perfect sense in retrospect.

The timing of this post is somewhat fortuitous, as Nicola just announced today the republication of her Aud Torvingen novels! I don't think I ever blogged about these since I felt like I didn't have anything particularly insightful to say, but I highly enjoyed them: great hard-boiled modern noir mysteries with (as usual) a vivid and compelling protagonist and sharp writing. She has previously blogged about the ordeal in dealing with these books: although it is a linear trilogy, each had a separate publisher, and none of them were ever motivated to publicize the other books or offer a unified visual appearance. After a LONG time she got the rights back, and I'm sure she's thrilled to finally have them presented as she'd like them.

Anyways! I highly enjoyed Spear, and I think just about anyone would like it. It's a much easier commitment than Hild, familiar enough to be accessible, unique enough to be intriguing, with great characters and telling its own flavor of a heroic journey.

Common Sense

I finally read "Common Sense on Mutual Funds" by the late, great John ("Jack") Bogle. I feel like I've been reading around this book for a decade, poking away at Bogle's shorter works and various books by other authors that occupy similar spaces and quote from it. I've enjoyed actually going to the source and directly experiencing it.

 

I read the second edition, published in 2009, and really loved how it's structured: it has the exact same text as the original edition from 1999, but with all of the tables and graphs extended to the right to show the next 10 years of data. He also includes periodic boxes labeled "10 Years Later", within which he adds new commentary on how the additional evidence of the last 10 years has affected his earlier analysis. In nearly every case it confirms his earlier assertions: sometimes he regrets being too cautious in his initial pronouncements, but I can't think of a single instance where he was wildly off the mark. It's especially interesting because the 1999-2009 period was basically the reverse of the 1989-1999 period: the 90s were a period of huge and largely uninterrupted growth, while the 2000s were bracketed by two major bear markets and overall resulted in flat or negative returns. And yet, the overall principles Bogle lays down remained as true in the "winter season" of the future as they had in the "summer season" of the past.

I think that this second-edition update is structured basically like how Burton Malkiel's "A Random Walk Down Wall Street" went in the later editions: he updates the relevant figures and charts, but the overall argument has remained identical over the last five decades. And that's really remarkable for both books! As many others have observed, it's easy to sift through past data and invent a model that would have made money in the past. It's significantly harder to work with "real money", anticipating strategies that will work in the future. Both Malkiel and Bogle have the appropriate humility to recognize the limits of what we know, and solid mathematically-backed arguments for their strategies, with a healthy dose of prior data that generally aligns with their recommendations and that continue to mostly hold true into the future.

This is a big book, but well structured and readable. I enjoyed reading it cover-to-cover, but you could probably dip into specific chapters based on your interest. This is one of the more comprehensive financial books I've read, covering the fundamental theory behind investing, where earnings come from, how the industry is structured, and a strong focus on the cultural and ethical principles at play. Much of the material was already familiar to me, but even the "old stuff" was often treated in more depth or with a new perspective that I found helpful.

For example, he spends a fair amount of time writing about the equity risk premium. This is a term I've heard about a lot in my recent financial reading, and I think I'm finally getting it. In The Four Pillars of Investing, William Bernstein illustrates this principle with the example of a falafel vendor raising money for a restaurant, comparing the option of taking a loan from a bank (low risk to the bank, high risk to the entrepreneur) or finding an investor who will buy an equity stake (low risk to the entrepreneur, high risk to the investor). To entice an investor, the business needs to plausibly offer a return on the investment high enough to offset the risk of losing everything. When Bogle introduces the equity risk premium, he goes right to the real-world example of buying a Treasury versus investing in a stock. If two investments offered the same average return, but one is risk-free and the other is risky, investors would always prefer the risk-free one. In order to attract investors, the riskier investment needs to offer a higher expected (not guaranteed!) return. The difference between the risk-free rate (like a Treasury's interest rate) and the expected return on the riskier investment is the equity risk premium. (To these examples, I'm adding my own of choosing to play a game where you can either get $1M outright, or flip a coin to get either $0M or $2M. The average result of these two choices is identical, but pretty much anyone would choose the $1M guaranteed return. In order to accept the coin flip, you'd need an extra incentive.)

As I read more finance stuff, I've gradually come to realize that some things are pure mathematical relationships, like the inverse relationship between current interest rates and the value of existing bonds. Other things describe trends we have observed over time but that aren't bound to natural laws, such as the P/E ratio, the Equity Risk Premium, and so on. Knowing these general trends and relationships is helpful in understanding the range and probabilities of possible outcomes, but they do not offer any guarantees. One of my favorite sayings in investment is "the market can remain irrational for longer than you can remain solvent." We can recognize that something is out of whack and is overdue for a return to the mean, but there's no way to predict when or how that return will occur.

Anyways, Bogle makes an interesting, nuanced point that I don't think I would have followed if I wasn't already primed for following this from other recent readings. Bogle makes the point in the context of his argument that seemingly small fees can make a huge impact; for example, a 0.2% versus a 2.0% expense ratio for a fund. If a fund has gross returns of 10% annually, then netting 9.8% versus 8% doesn't seem like a huge difference until after you've compounded for several years. But if a T-bill returned 6% over the same period, then you're talking about an equity risk premium of 3.8% versus 2%: essentially a doubled premium for the lower-cost fund. Given a certain (reasonable, though definitely not guaranteed) set of assumptions, he shows how an 80/20 stock/bond portfolio using an actively managed fund may have the same expected return as a 20/80 stock/bond portfolio using indexed funds. The difference is that the 20/80 portfolio bears significantly less risk than the 80/20 portfolio. I'm very used to just looking at (average, expected) returns, and it was cool to see a similarly analytical approach to quantifying the impact of costs on risk and not just reward. Anyways, I think that's neat!!

This idea connects well with William Bernstein's argument for purchasing a liability-matching portfolio. If you have a specific goal, and you can achieve that goal with no risk, then boom: you're done, and can spend the rest of your life assured that you'll never run out of money. Alternatively, you can choose to take on more risk to maximize the growth of your portfolio. Over the very long run (which may be longer than your lifetime!), the latter approach will generate more money. So, yeah: once again, risk is an important thing to consider, and fortunately something that we can think discretely about as opposed to just a hand-waving "being able to sleep at night" attitude.

Returning to mathematical certainties versus empirically-derived correlations: I think Bogle does a good job at describing when he's dealing with one type of relationship versus the other, and is especially forceful with the former and appropriately cautionary with the latter. On the mathematical side, he's insistent that, by definition, all investors as a whole must earn the average return of the market: for every manager who manages to beat the market average, there must be another investor who loses to the market average by the same amount. So (comparatively speaking) "beating the market" is a zero-sum game before costs, and once you take costs into account, more expensive actively-managed funds must, by definition, as a group, under-perform the market average.

What the market average does over time, on the other hand, is empirical, not deductive. Going back to 1820, the stock market has consistently trended upward over the long run. There's no guarantee that it will continue to do so, definitely not during a short term and possibly not over a very long term. So there is risk that investing in the market will result in a loss. But it is a certainty that low-cost (generally indexed) funds will perform better than the average actively-managed fund, whether the market is going up or not.

Bogle has a sense of pride, which I think is pretty well-earned, in creating the first commercially-available index fund, and for being generally correct about how the market works, thanks to insights like predicting long-run market returns based on the current dividend yield plus the growth rate. He claims these wins but isn't obnoxious about it.

The biggest outlier between Bogle and the contemporary Boglehead movement is definitely international investments. Pretty much everyone besides him believes in a significant international exposure; the most common belief today is probably reflecting overall global market capitalization, while many (including myself) overweight the US equity markets while still having a significant minority share of international equities. Bogle argues pretty strongly towards having an all-US portfolio, and grudgingly concedes that you might include up to 20% international for diversification purposes. I've read (and heard) his arguments before, though I think this book handles them at more length and in more depth. They include:

• The US has significantly better legal protections, liquidity, transparency, regulations, and other helpful aspects to its financial markets.
• The US has been and remains the global leader in innovation, both creating new successful businesses and growing existing ones.
• Contrarily, given the demographics of the other fully developed markets (Europe and Japan), he doesn't see much opportunity for future growth: they're already built out, and have aging populations and minimal immigration. More growth is possible in emerging markets, but also significant risk, and it's hard to say with certainty that future returns would be worth it.
• The largest US companies already have significant international exposure (earning overseas revenue, using overseas labor, etc.), so you already get some diversification while holding only US stocks.
• Everyone reading this book is a US investor spending US dollars in the US, and international investing exposes you to significant currency risk: a rising dollar will cut into international returns while a weakening dollar will boost them. As with most things in finance, he identifies a long-term reversion to the mean in relative currency strengths. At the time of publication, international stocks had provided great returns; but he notes that this was mostly due to a weakening dollar, and if you correct for the exchange rate, they actually underperformed US markets.

I think it's interesting that the one argument that he seems to (grudgingly) accept as legitimate is diversification, the idea that holding international equities will soften the blow of a broad decline in the US stock market, somewhat like bonds. I think that the diversification hypothesis has been declared dead and buried in the last 15 years: now that we're in a fully globalized world, markets are so interconnected that everything falls when the US does; I'm reminded of the phrase "When America sneezes, the rest of the world catches a cold." We saw this in 2008 (though it may not have been obvious at the time of the second edition) and has continued to hold true since. (Interestingly, the converse has not recently held true, as the US market strongly rebounded from the COVID-19 recession while Europe and Japan continued to languish.)

Pretty much everyone (including modern Bogleheads) disagrees with the rest of his points on international stocks. Taking a crack at summarizing the major counter-arguments I've heard:

• Reversion to the mean applies to the US as well as everyone else. Outperformance can't last forever.
• It's mathematically impossible for US outperformance to continue indefinitely, as it would eventually result in a US capitalization of over 100% of global markets.
• US market strength in the 20th and early 21st century has reflected US dominance (political, military, and economically) over the world. If and when these strengths decline, our market share will as well. In particular, it will be very challenging for the US to remain dominant over countries with significantly larger populations once those countries are fully developed.

It may be worth noting that Bogle wrote this book in the late 90s, and the ~25 years that have passed since then have been pretty friendly to US-only investors; in more recent years, China has emerged as a bigger long-term rival to US supremacy. So Bogle's original advice was very good to people who were reading at the time during their 10-40 year investing journeys, but it's less clear if that will continue for the rest of the century, as he briefly acknowledges in passing.

I also have been enjoying comparing Bogle's arguments with William Bernstein's "Birth of Plenty" thesis. Bernstein identifies a cluster of ingredients (including social norms as well as technology) that create significant and self-sustaining growth. Those are obviously present in the US, were present in Britain before, have been spreading to other advanced economies. But they aren't something you can flip on at will in a developing country: it requires generations of local acceptance and integration. Anyways, if Bernstein is right, then it isn't a slam-dunk that emerging markets will outperform within our lifetimes, or even our children's lifetimes. And, to be a bit more pessimistic, the best we can hope for in the future may be a sustained real growth of ~2% per year in the most advanced countries, including the US, in which case we will be no better but also not significantly worse than anyone else.

I periodically remember how things have changed. At the time that Bogle wrote the first edition of this book, mutual funds (let alone index funds) were still somewhat of an anomaly; most stocks were individually held. By the second edition nearly half of all shares were owned through mutual funds or ETFs; I assume even more are today but am too lazy to look it up. The change is primarily due to higher participation in 401ks, 403bs and IRAs, but I think the diversification and ease of use probably also contribute. I think that the shift towards mutual funds makes his arguments even more relevant, since he's mostly comparing indexed vs. actively managed mutual funds, not so much indexed vs. individual stocks.

The chapter on taxes is really interesting. One thing I hadn't thought of before is how a fund as a whole could have unrealized capital gains thanks to appreciation of its underlying stocks; in his example, if you buy a $100 mutual fund share but there's an unrealized capital gain, then you may only be getting something like $78 worth of stocks for your purchase after accounting for the tax. This tax liability reduces with additional shares, though (since the pre-existing gain is divided among more people), which gives an incentive to grow the fund. He also makes some good points about the value of deferring capital gains; that is not relevant in a tax-advantaged retirement account, but for regular taxable accounts, you can get significant benefits by compounding tax deferrals over a decade or longer. That isn't possible in funds with high turnover, as those gains must be realized when the underlying shares are sold. It seems like tax deferral isn't as relevant for dividend taxes, which must be paid the same year.

Interestingly, both Bogle and Bernstein say it's safest to own the entire market, but Bernstein likes tilting towards value while Bogle seems to slightly prefer tilting towards growth. Over very very very very long periods of time, value stocks have historically returned a bit more than growth; and they don't usually dip as far as growth stocks during downturns, so they're a bit safer to hold in a retirement portfolio. But value stocks tend to return relatively more in dividends, while growth stocks return more in capital appreciation, and Bogle likes how that gives you more control over when and how (or even if) to realize those gains.

Index funds are praised, but are a smaller part of the book than you might think. Bogle would prefer a low-cost managed fund over a high-cost indexed fund, and owning appropriate asset classes is a lot more important than being indexed. He often toys with the idea of directly owning a basket of stocks, and I suspect that he would favor that approach for very wealthy people: mutual and indexed funds are more of a convenience for those of us with extra money to invest but not the deep pockets or professional acumen to assemble our own broadly diversified portfolios. He even supports the idea of very talented managers beating the market; his concern is that you can't identify them in advance, and either they'll close their funds to maintain quality, or expand the fund and practically guarantee future mediocrity.

Early sections of the book cover the same sort of ground as "The Little Book of Common Sense Investing"; the last parts are in the same vein as "The Battle for the Soul of Capitalism", with a little of the autobiographical details of "Enough." So if you're only going to read one Bogle book, this is probably the one that has it all. He writes sternly about the responsibility mutual fund companies hold towards their clients, and how that responsibility is consistently shirked. He eventually names Vanguard and makes a much more direct and impassioned case for why it's special. By this point, hundreds of pages into the book, he's established his intelligence and his values, so it feels deserved.

It's interesting to compare the Bogle-led version of Vanguard as depicted in this book with what exists today. As I've written before, I've been a loyal Vanguard client for decades, but if I were to start investing today I would likely go with Fidelity. Something has changed - no one single decision that made Vanguard lose its way, but a series of decisions over years that he never would have agreed with. One famous one is the introduction of ETFs: Bogle consistently rails against these in the "ten years later" section, and they were brought in essentially over his dead body, after he was forced into retirement. It makes a ton of sense for Vanguard to sell ETFs - investors demand them, and they hew to most of the key Vanguard values like low cost, transparency, and simplicity. But Bogle hated them because they can be (albeit don't have to be) frequently traded like stocks, and so lead people away from the focus on long-term investing that he sees as so critical. More recently, Vanguard has forced all of us legacy users of the mutual fund interface to their new brokerage platform. Again, it makes a lot of sense: it's more economical for them to only support one interface instead of two, and the brokerage site can do almost everything the old mutual fund site could do. But again, being a brokerage is fundamentally about instant gratification, making it easy to buy and sell individual stocks and bonds with the click of a mouse. I can just hear Bogle gnashing his teeth over pushing Vanguard clients away from a long-term-focused platform to the new one.

There's a touching anecdote near the end of the book about how a major institutional investor offered to invest hundreds of millions of dollars into a small-cap short-term bond fund at Vanguard for a few months. It would have been great for the institution since they'd get a major guaranteed return, and it would be great for Vanguard since they'd get the fees and business. But Vanguard rejected it: the existing small investors of the fund would get stuck with the capital gains taxes from that large trade, despite not trading themselves (as good, disciplined long-term investors). The institution was irate, pulled all their business from Vanguard and even wrote a nasty letter in the Wall Street Journal blasting Vanguard. The company lost short-term business, but gained huge respect and loyalty from their existing customers, and attracted many new ones who admired their ethics. I don't see the Vanguard of 2024 making that same decision, and that makes me sad. I'm reminded of Bogle's insistence in Enough. of how crucial it is to focus on the thing you can't count (like reputation) over the things you can count (like quarterly sales).

Anyways! Like I said up top, I really enjoyed this book. Reading it takes a big investment (heh) in time, but it's low-risk and offers significant rewards: practical guidance on personal financial planning, a deep understanding of how markets work, and a wide-ranging, insightful survey of the mutual fund industry and the people it employs and serves. The more I read and hear from Bogle the more I admire him. Even if he's gone, and even if his version of Vanguard is fading, he's left behind an extraordinary legacy in the way individual investors think and behave.

Why Does Nobody Talk About The WOMEN Who Lost America?!

I've really enjoyed reading "The Men Who Lost America" by the entertainingly named Andrew Jackson O'Shaughnessy. The premise behind the (non-fiction) book is very simple: the story of the (American) Revolutionary War as told from the British perspective.

 

O'Shaughnessy is an academic historian, and notes that surprisingly almost all scholarship has been performed by American researchers; the British historically seemed embarrassed to plumb deeply into the details of the episode, so most uncovering of primary sources on the British war effort have been performed by Americans abroad rather than home-grown academics.

The book is structured really well. Each chapter focuses on a particular individual responsible for leading a major aspect of the British war effort. They are also organized such that the chronology generally advances forward: there's definitely overlap, but usually a following chapter will describe how someone attempted to recover from the shortcomings of a previous leader. The chapters are also grouped into three overarching sections: first the political leaders, then the army generals, and finally the admirals. This turns out to work nicely in making sense of the overall conflict, as the political sections can go into a lot of detail on the background leading up to the war, the generals have non-overlapping reigns of chief commanders, and the admirals' efforts prove instrumental in securing non-disastrous terms for the British and paving the way for their navy-powered world domination in the 19th century.

I won't recap everything in the book, but broadly speaking, it was pretty eye-opening for me. A lot of things that I've taken for granted since early childhood turn out to be inaccurate or incomplete; I've gotten a better understanding of the broader context and stakes of the war beyond the border of the 13 colonies; and it was really compelling to see how certain key incidents like Benedict Arnold's betrayal or the Siege of Yorktown were seen from the British side.

The first chapter covers George III. I've just dismissively thought of him as a crazy, inept king, but he comes across really well in this book, albeit with some significant flaws in judgment. (This pattern will FREQUENTLY recur!) O'Shaughnessy notes that, almost right up until the outbreak of the war, George was actually generally better liked in America than he was in Britain. Stepping back a bit: Britain had spent a great deal to defend America during the French and Indian war (aka the Seven Years War) (Which, although O'Shaughnessy doesn't really get into it here, was basically single-handedly sparked by George Washington). America received a lot of the benefits of being protected by British military and diplomatic power, but the per-capita tax burden on people living in America was a miniscule fraction of what the average Englishman paid. So there was a growing sense in Parliament that America would need to pay more to contribute towards the upkeep of the Empire. As we all know, Americans strongly disliked this: actually paying taxes isn't fun, and beyond that, they resented being told what to do by people on the other side of an ocean, and more broadly felt disrespected and oppressed.

For most of the decade or two leading up to 1776, the conflict was seen as upholding the doctrine of the sovereignty of Parliament - that is, the idea that Parliament is the ultimate authority on all matters in the British empire. This is significant, in that the principal dates to the Glorious Revolution and is in some ways anti-monarchial. George III wasn't especially concerned about the colonists one way or another, but the politicians were keen to keep Parliament strong as an institution. So, there was this interesting dynamic where the colonists for a while were directly petitioning George to shield them from the actions of Parliament, implicitly promoting monarchy over democracy.

While George wasn't involved in the various taxes and acts that first assessed and later punished the Americans, once the situation escalated to the point of armed rebellion, he became firmly on the side of defeating the revolution by force. A kind of switcheroo occurred where Parliament, who previously had been so gung-ho on showing the Americans their place, began to have second thoughts and much more sympathy towards the rebel cause; while the king, who had been predisposed to show mercy, became intransigent on the need to unambiguously defeat the rebellion. And in fact the main reason why the war dragged on as long as it did, several years after Yorktown, is because George refused to give in.

Returning briefly to the topic of his mental state - as I wrote above, I've typically just dismissed George III as a "crazy king". He comes across as extremely stable, thoughtful, and rational in this book, with an awareness of the logistics of the conflict, strong understanding of the various people, and a grasp of details. Several people have audiences with the king and are very moved by the experience. Anyways, his famous "madness" turns out to have been a blood disease of all things. The symptoms would include seizures, period of delirium and incoherence, and, tellingly, purple urine. While this is a malady he struggled with, from this book it doesn't seem debilitating, more of an episodic thing that gradually increased with age but never really overwhelmed him.

The second chapter covers Lord North, who was the Prime Minister leading up to and during most of the war. He's a really fascinating character: while nominally the most powerful man in Britain, he's cripplingly indecisive, unable to set clear policy, resolve disputes between subordinates, or clearly express his aims. As with most of the people in this book, he does have some very strong talents: he was also the Chancellor of the Exchequer, prior to and during his term as Prime Minister, and seems to have been a financial genius, ably managing the empire's challenging loans and expenditures. But he is wholly inadequate to the wartime task, and recognizes his own limitations. It's both comical and pathetic how frequently he asks to be allowed to resign, only to be turned down over and over and over again: all of his potential replacements are opposed to the war, and King George demands a supporter in this role.

Among other things, this book is an interesting snapshot into a particular window in the development of institutions: we learn that North was one of the first people to carry the specific title Prime Minister, and people were still trying to figure out exactly what that job entailed. He leads a Cabinet, but there wasn't really a concept of a unified Cabinet policy, it was more of a collection of powerful individuals, who in this case often publicly warred with one another. We still see the remnants of a feudal patronage system, as certain individuals in the House of Commons or the House of Lords will have a certain number of members of Parliament in their pocket, and appeasing these specific factions is required in order to maintain a majority for the present government. Fascinating stuff!

Jumping forward to the army: much like with Lord North, there's a strong strain of indecisiveness that seemed to paralyze British action for the crucial first years of the war. Fundamentally, both sides still saw each other as British: many Americans wanted the respect and representation of their island ancestors, while the British wanted to discourage their wayward children and bring them back into the fold. So while the British arrived with a significant military force to exert their will, they didn't really want to use it: the commanders understood well that violence would harden the Americans' resolve and make rapprochement more difficult.

At this time, most leaders of the military were hereditary nobles, which meant they also had active political careers, and as a result many talented leaders were not eligible to lead the American war because they had opposed the war. The first pair of leaders were two brothers, General George Howe and Admiral Richard Howe. In some respects they were the best leaders of the war because they collaborated so well between the army and the navy; throughout the rest of the war, the two branches notoriously failed to cooperate. However, the brothers insisted on also being appointed as peace commissioners, so they arrived with fig branches in addition to rifles.

Howe seems to have been a good military commander, thrashing George Washington in a series of battles that ended with New York City firmly under British control. But he and his subordinates failed to prevent the escape of the Continental Army, which could have delivered a decisive knock-out blow. There's a lot going on in that escape, but one big element, again, is that Howe didn't really want to kill the Americans: their goal was essentially a "shock and awe" campaign that would make the Americans realize their cause was hopeless and end the war before too much bloodshed occurred. That dual role of peace commissioner and military commander made it hard to decisively pursue strong victories, in much the way that Lord North had a hard time deciding on a specific course of action.

There are of course many factors that lead to Britain's loss, but I came away from this book with the impression that the single greatest error was that Britain assumed that the silent majority of Americans were loyalists, and that the revolutionaries with a small and loud minority, so the thinking went that all the British had to do was show up, then loyalists would flock to their side and they would collectively steamroll the opposition. That wasn't the case, of course: yes, there were loyalists, but far fewer strongly committed loyalists than strongly committed revolutionaries. When loyalists did declare for the British, the army felt compelled to protect them, which then necessitated defending those areas and limiting the available forces for offensive actions. Otherwise, when the British left, the loyalists would be driven out or even killed by partisans. The Howes like many later commanders realized that they couldn't in good conscience call upon the loyalists unless they were prepared to protect them.

One of many factoids I learned throughout the book is that the size of both the British and the American militaries steadily declined after 1777. On the American side, the pay was bad, the currency inflated into near-worthlessness, conditions were generally miserable, with shortages of food and clothing and shelter and heat. The British had supply problems of their own but didn't need to worry about soldiers deserting; rather, their problem was that Britain had to defend a far greater area than just America. Even as the war started they were nervous about the situation in Ireland and retaining Canada, and once France and Spain entered the war they had to worry about their possessions in the Caribbean, Gibraltar, Jersey, India and various East Asian islands. The commanders on the ground in North America always recognized that they had far too few men to accomplish their mission, but despite that were always being ordered to send men to Jamaica, to Nicaragua, to various other places. So their resources kept dwindling, and yet King George and the Secretary of State Lord Germain demanded offensive actions and taking the initiative. Little wonder that the commanders fared so poorly.

After the strong initial opening in New York, General Burgoyne's decisive defeat at Saratoga rocked the British on their heels, with everyone belatedly realizing that this war would drag on for years. After the Howes were recalled General Clinton took command. He comes off as amusingly whiny in this book: like everyone else in his position, he realized that his situation was hopeless, and he just cannot stop complaining about it, constantly feeling that he's being set up as a scapegoat to pin the failure on.

Dysfunction is a huge recurring theme of the book, with people and organizations unable to cooperate. Shipping vinegar from Britain to America takes seven months. Something like twenty separate departments are responsible for transporting supplies for the war, and none of them are under the control of the War Department. Generals Clinton and Cornwallis start off on fairly cordial terms, after some catty comments and stirring up drama, they get into a situation where they won't talk with one another for months. Clinton is hunkered down in New York City while Cornwallis is rampaging throughout the Carolinas; Clinton thinks that Cornwallis is making a mistake and accomplishing nothing, but doesn't bother to order him to do anything different. Cornwallis eventually reaches the Chesapeake Bay, after which Clinton sends his first direct order in half a year, to fortify a harbor as a new naval base. Neither of them are aware that the British Navy is mostly in the Caribbean and Cornwallis is dangerously exposed. This all leads to the huge defeat at Yorktown, the single biggest military disaster of the war.

The last part of the book focuses on the admiralty; shorter than the others, it just has two chapters, one on Rodney and the last on the Earl of Sandwich. Like most people in this book, Rodney has many facets. He wins great renown for the Battle of the Saintes and for relieving the siege of Gibraltar. But much of the chapter focuses on his capture and plunder of St. Eustatius, a Dutch free port in the Caribbean. Rodney was badly in debt and stood to personally benefit from a share of plunder, so he basically ignores the military needs of Cornwallis and other generals to instead go after a rich trading port. This is a pretty dark section, and we read about Rodney's anti-semitism and general nastiness in this episode. While his action pretty directly contributed to the loss of America, he's just about the only person in the book who emerges from the war with his reputation enhanced, thanks to his victories elsewhere at sea.

Finally, the Earl of Sandwich (who, yes, does seem to be the inspiration for the word "sandwich" as we use it today) is a pretty compelling character. He's the oldest member of the cabinet and an institutional link with the earlier regimes of government. He's the First Lord of the Admiralty, which is usually held by an admiral, but he's a very capable administrator. Much like Lord North in the Treasury, Sandwich provides excellent reforms for the navy: across two terms in office, he personally walks the docks to inspect them, sees chronic issues like rotting timbers, and starts a significant program to improve Britain's process for procuring, building, repairing and replacing ships.

One of many ironies in the book is that the Earl had strongly argued early on for greater investments in the navy, as much of the fleet is mothballed in peacetime and many of the remaining ships are past their useful life. Lord North and others deny him. Later on, once the war expands to include France and Spain, England becomes hugely vulnerable to their combined navies. The government belatedly begins to fund the expansion, but it takes years to build new ships, so they can't arrive soon enough to be of help in this war: in fact, despite the wartime infusion of investment, the size of the navy actually declines, as older ships need to be retired before the new ones can replace them. The Early of Sandwich becomes one of the most hated people in the entire book, blamed for all the deficiencies of the navy, despite the fact that he recognized those deficiencies before anyone else and tried to have them fixed back when it could have done some good.

The book ends with a relatively upbeat assessment of the legacy of the war for Britain. Yes, Britain "lost": she had to surrender the colonies. But thanks to some late naval victories, Britain was able to negotiate separate peaces between America, France and Spain, and received better terms than otherwise might have been achieved. Thanks to the vision and drive of the Earl of Sandwich, Britain ended the war with a powerful and well-functioning navy, which directly paved the way for the globe-spanning Britannia empire of the 19th century. The early chapter on Lord North similarly notes how, thanks to his prudent management of Britain's finances, the war, while painful and expensive, could ultimately be borne by Britain's credit markets; on the flip side, France, which "won" the war, acquired incredible debt as a result, which directly led to the summoning of the Three Estates, the French Revolution and the end of the monarchy. When you zoom out a few decades, it isn't crazy to think that Britain came out of the war rather well. In fact, we learn that the value of Britain's trade with America was greater after the war than before it.

So, yeah! Good book. I thought it was interesting, well-written, well-structured, gave me new perspectives on old stories and introduced me to some (to me) brand new stories. I'd definitely recommend it to folks who enjoy history.

Sovereign Syndicate

Thanks to the good graces of Another Brother, I recently got to play through Sovereign Syndicate, a great little indie RPG. Reading the description makes me think that it was created in a laboratory specifically to appeal to me: if you imagine the intersection between Shadowrun Returns, Disco Elysium and Fallen London you'll have a great idea of what this game is. As those are my three favorite RPG-ish properties of the last decade, it's a uniquely compelling pedigree.

Sovereign Syndicate is set in an alternate version of Victorian England. There's steampunk-y technology, along with a completely new world history that includes some new global superpowers (Zululand is an empire that spans the Atlantic). One of the more striking aspects is the insertion of fantasy races into human society; unlike Shadowrun's adoption of Tolkien-esque elves, dwarves, orks and trolls, Sovereign Syndicate highlights races from classical mythology like centaurs, minotaurs, cyclopses and satyrs.

Like Disco Elysium and Fallen London, Sovereign Syndicate has stats like an RPG, but is oriented around non-lethal encounters and problem-solving using skills like observation, critical thinking, persuasion and sleight of hand. The system oozes with flavor: you may level up in humours like "yellow bile" and "melancholy", which will eventually increase stats like "Self-Determination" and "Animal Instinct". The skill system isn't as broad as Disco Elysium, but is used very similarly: you take challenges based on the skills you have, and also see reactive observations from your inner dialogue based on those aspects. (So, your "Animal Instinct" may chime in in response to something another character says. Even the art for these aspects is very evocative of Disco Elysium's. Overall the game very much feels like it's continuing in Disco Elysium's footsteps, which is fantastic, because we need a lot more of those sorts of games!

Continuing with the very unique and evocative character of its systems, Sovereign Syndicate does not follow the die-rolling or random-number-generator approach followed by most RPGs. Instead, challenges are based around a Tarot deck. When you take a challenge, you'll draw a card from the deck, add that value to the relevant stat, and compare that against the challenge value. So, for example, if you are checking a Spryness of 20, have an innate Spryness of 15, and draw a 6 of Cups, then you'll have a total of 21 and pass the challenge. The special card "The World" will auto-pass any challenge, while "The Fool" will auto-fail the challenge and re-shuffle the entire deck.

This has some interesting and cool mechanical implications. It took a while for me to realize it, but you're essentially card-counting whenever you check the odds of completing a challenge. If you've already drawn a lot of high cards, then those can't be drawn again until you find The Fool, so you're more likely to be stuck with a lower card; of course, if you have had a string of bad luck, then karma is naturally weighted in your favor and you'll be more likely (but not guaranteed) to draw a high card. Neither success or failure are ever guaranteed, and there's always an outside chance that luck will triumph over the odds. Also, this system limits against save-scumming: you're not re-rolling the dice, just drawing whatever card is on top, which was set way back when the deck was last shuffled. BUT, depending on where you are in the game, you might be able to take different challenges to get deeper into your deck before returning to the first one.

The tarot deck you're using is specifically the "minor arcana". You can also acquire "major arcana", which permanently unlock certain dialogue choices and abilities: being a social chameleon, or blunt speaking, or able to cast illusion spells. They function like Etiquettes in Shadowrun, giving you a challenge-free way to progress in a dialogue or situation.

I really love the non-combat design. I think a lot about ways that we could design and play RPGs without fighting and killing, and I love seeing more and more of these games come into the world. So many of the things we have in RPGs today are there because Gary Gygax made an arbitrary decision 60 years ago, and we all kind of continue those systems forward without thinking about it: things like gold, XP, levels, hit points, etc. I love it when games get away from those conventions. Sometimes, as with Tides of Numenara, it can feel like the designers are working a bit too hard to go against the grain, which also isn't great: doing something different isn't automatically better, and can feel annoying if you're being asked to learn a new system that doesn't improve on the mechanics or flavor of the status quo. But it's really nice to feel like you're playing a game that popped in from a parallel universe where games evolved differently, and Sovereign Syndicate belongs to that latter group of games. 

One specific example here: your character's mood acts kind of like their health bar. It's a range from 0-100, with descriptions like "weary" near the bottom and "content" near the top. Your mood may be damaged if you fail a challenge, but also if, like, you see a dead bird in the gutter, or if you give a cynical answer to a question. You can improve your mood by succeeding, but also by expressing optimism, noticing pretty things in the world, or listening to praise from others. Once you get the hand of the system, it's pretty easy to raise by paying attention to your surroundings and the options: picking upbeat replies, taking baths, and so on help raise it, so you can maintain around 100 after a while. In some ways this becomes self-reinforcing, as certain dialogue options are themselves gated by your current mood.

I'm not sure what happens if your mood reaches 0 - mechanically it seems like it could be a "game over" type of situation, but given how the rest of the game works, I imagine it's more of a story impact, restricting your actions to the "Weary or Worse" choices.

The mood bar oddly makes me think of Lord of the Rings Online. In the Tolkien mythos there is no resurrection, so death has always been tricky to handle in games set in Middle-earth. LOTRO handles this by instead having "Morale", which functions equivalently to Health but is meaningfully different in the story. The idea is that your character can press on, will grow discouraged over time (due to their wounds or other hardships), and once they fall into despair they give up and need to return home to regather their strength and courage. Acts like singing are very powerful in raising morale, functioning similarly to applying a bandage to a health-based system but much more meaningful and evocative in this setting. Anyways, I like how Sovereign Syndicate does something sort of similar, and I think it could work well for lots of other games too. (There are many other examples, of course. Failbetter has Fallen London with "menaces" like Scandal and Suspicion, along with Supplies and Nightmares in the Sunless games, and going way back there's Sanity in the Call of Cthulhu pen-and-paper games.)

Visually, the art design of Sovereign Syndicate feels a lot like the new Shadowrun games. It mostly feels isometric, with a bit of dynamic shifting: in Shadowrun there was a light parallax effect around the Y axis when you panned the camera. In Sovereign Syndicate, the camera always centers your character in the middle of the screen, but the camera tilts around as you move through the map. For a while I thought Sovereign Syndicate also used 2D hand-painted backgrounds, but later levels of the game make more clear that the whole game is 3D, just locked to a range of a given isometric angle.

Also like Shadowrun, most of the gameplay consists of you clicking to walk around on a map, then clicking on people and objects to interact with them. This brings up a Shadowrun-style (and I suppose Disco Elysium-style) dialogue pane on the right where you can read through the speech or narration, and select from a few response choices. 

There's also an occasional segment of comic-book-style movement panels. I was impressed that these are introduced so late in the game; it's pretty striking and cool imagery, and it was nice to have it be a surprise and not something you see right off the bat. Likewise, there's no voice acting in the game, but it's really cool to hear a character sing after playing as them for a while.

Before dipping into plot discussion, I have a few minor criticisms to share:

• The music is pretty, but is too short and quickly gets repetitive. This is compounded by how often music is shared between different large maps.
• The art style is pretty nice, but the loading screens feel muddled.

• Navigating large areas like Sorris Square gets tedious. I'm glad that you can fast travel between maps, but you often need to walk a long way to get where you need to be. (I'm really feeling for the players of my Shadowrun campaigns!)

• There are some minor glitches with quest progression. Occasionally the Journal still lists a task even if you've completed it. There was one point where I thought the game was stuck, had to Google and find that I needed to take a non-intuitive step to progress.
• This isn't exactly a problem, but the Journal includes some tasks that aren't really actionable (like "Wait to find out more about the voices in your head") alongside actual things you can progress. Early in the game you get a LOT of quests and can only see 4 on screen at a time, although it's easy enough to pop open the Journal and see the rest. (Later on you can trim down and just have a main and a couple of side quests at a time, which feels better.)

That's about it for complaints! Now for some

MINI SPOILERS

Besides sharing some of the same design principles and mechanics, I feel like the overall ethos of Sovereign Syndicate fits within the psychic space of Shadowrun, Disco Elysium and Fallen London. All of these games feel generally progressive, skeptical of capitalism in general and the mechanization of labor in particular. They also (other than DE) express some interest in transhumanism and non-biological sentience. (Well, I guess DE does have the Horrific Necktie, so maybe that counts.) Sovereign Syndicate is maybe a bit more like Shadowrun in that the world created seems to imply a point of view but that point of view isn't explicitly expressed within the game, whereas DE and FL seem more confident in adopting an authorial perspective.

One really cool aspect of Sovereign Syndicate is that you play as four (mostly three) distinct characters. You don't travel together in a party: instead you play as one for a while, then after hitting a story beat you switch to another, and so on. For each character you choose an initial "archetype" that sets their initial stats, which in turn helps determine how they will tend to approach problems: like, a Clara who focuses on Grace will likely mostly try to charm people, while a Clara who focuses on Intellect will outwit them. This opens up some neat possibilities for you as a player: personally, I find it easier to role-play against type when I have multiple PCs, so one might be a goody-two-shoes while another is a scoundrel.

The actual plot of the game takes quite a while to get going, it's more about immersing in the atmosphere. You start off playing as Atticus Daly, an illusionist Minotaur who is contacted by a mysterious man to get out of a jam. Later on you also play as Clara Reed, a courtesan; and Teddy Redgrave, a combat veteran and tinkerer dwarf along with his automaton. The main plot seems to circle around a Jack the Ripper-esque criminal known as the Courtesan Killer who has been murdering Londoners. That's mostly a background concern, though: your characters are focusing on other tasks and looking into the killings whenever the opportunity arises.

MEGA SPOILERS

Some evidence suggests that a werewolf is the killer, but that evidence seems a bit too convenient, and for much of the game I suspected that they were being made scapegoats. Werewolves seem to be the main target of prejudice at least in London; people generally seem cool with centaurs, maybe just slightly skeptical of cyclopses and minotaurs, but quite down on werewolves.

As it turned out, I was right, I think. A lot of disparate plot threads come together at the end. I'm not 100% sure, but I think it's something like this:

The industrialist Silas Bragg (Lord Braxton) is a brilliant inventor. He created the Determination Core, which enables Otto with free will. He also wants to prove that the Determination Core can be used on humans; in particular, vegetative people can be brought back to self-sufficiency. This is a significantly harder task as the Determination Core is metallic and any human body would reject it. Braxton steals research from Dr. Wainwright, a scientist, and uncovers a serum that will allow the body to accept the transformation. That serum requires a large quantity of live werewolf blood. Braxton then contracts with Molly O'Malley, a crimelord, to obtain that werewolf blood. Separately, Madam Zora, proprietress of the brothel, has murdered some of her girls, and then murdered others who were getting close to discovering she had done it. The madame and Molly collaborate to frame a werewolf for the crimes. Once he is under suspicion, the werewolf will be offered sanctuary away from the police and imprisoned by Molly at Braxton's manor, where he can be exsanguinated for the experiment. Oh, but the woman selected for the experiment is none other than Atticus's mom.

So, everyone ends up having some connection: Atticus is close to the victim, Clara is friends with the murdered courtesans and an employee of the murderer, the dwarf is hired to kidnap the werewolf. They all come together at the end to uncover the plot, save the werewolf and stop the experiment. The mysterious masked man from the start of the game arrives with the authorities to take the perpetrators into custody. Much like Nick Fury, he then reveals that he represents a special organization that works for Her Majesty to confront secret threats to the Empire... and he is looking to recruit all four of them into this organization, Sovereign Syndicate.

So the whole game ends up feeling like a sort of origin story, the first chapter in an Avengers or League of Extraordinary Gentlemen, with the implication that these characters have been recruited into a bigger world of new adventures.

Some final thoughts:

I still had some open and unresolved quests at the end. I'm not sure if that's because I missed some things during the game or if I was locked out of completing some of those tasks from failed skill checks or earlier decisions I'd made.

I am curious about money. It's an important and seemingly very limited resource throughout the game, and there doesn't seem to be enough to do everything that you need. That said, there didn't seem to be any consequences to, say, not paying Atticus's rent. There's a lot of stuff that I could have bought that I chose not to, and I wonder what any of that does.

Near the end of the game, the loading screens and dialogue made it sound like I (Clara) had discovered some damning evidence in the madame's room; but I'm like 99% sure that I never searched her room. It seems like a bug, but maybe I clicked through something without clocking what it was talking about.

There's a ton of acknowledgement of your actions at the very end of the game, as the masked man recounts many of the side-quests you finished and choices you made. This isn't as much choice-and-consequences in the main body of the game, at least not that I picked up on; it could be interesting to see how things change in a replay.

END SPOILERS

As I keep writing, one of my favorite things in the world is a Relatively Short Game. Sovereign Syndicate isn't super-short; it kept me entertained for over a week of nights and weekends. Still compared to the mammoth RPGs I've been playing lately like Elden Ring, it's incredibly satisfying to be able to start, play, and end a game in a reasonable amount of time. Sovereign Syndicate impressively manages to do that while also delivering a wholly original world, new mechanical system, and a complex storyline will multiple player characters and dozens of non-player-characters. While definitely a lower-budget game, it hits above its weight and has earned a place on my shelf of fun indie RPGs.