The Environment versus Silliness: No, Optimism does not make you more rational

I tend to think, like George Monbiot, that the only appropriate moral reaction to the various forms of ecological trauma the world is experiencing - the mass extinctions, the hideous despoliation of our oceans with plastic and our air with toxins, the horrifying juggernaut of climate change -  is an attitude of very intense concern, and to begin doom-mongering in desperate hope that we might be able to reverse these horrifying trends before we fuck everything (and not merely out of concern for other species, but out of concern for our own). The case that this is the only appropriate moral reaction to the environmental degradation we are carrying out has to be made, of course, and maybe in this post I'll briefly sketch that case. The primary purpose of this post is not this, however. The primary purpose is to cover in detail an old bugbear of mine that falls within this universe. I've written about this bugbear before, within other posts, but I don't think I've ever dealt with it properly. The bugbear is the following Neoliberal/Libertarian/'New Optimist' anti-environmentalist rhetorical manoeuvre (I hope what follows isn't too Straw Man-y): 

Step A) Neolib makes the correct point that Malthus' famous and very simple model of population growth (assuming no improvement in agricultural technology, assuming that with prosperity would come increased fertility, when it has proved the opposite) stopped being applicable after the Industrial Revolution because we began to consistently improve our agricultural technology and because it turns out that the liberation of women is the panacea to a dangerously high birth-rate (a correct point they typically supplement with some predictable references to falsified 1960s predictions of collapse,  Silent Spring, the supposed errors of Limits to Growth, and (if it's Pinker or a Pinker-influenced person) some discussion of how cognitive science gives us reason to think that we are biased towards such extreme reactions, and how the media amplifies these biases). 

Step B) Neolib uses some graphs and some Hans Rosling statistics to make the point that, taking a very high-level, aggregate perspective on the world, the last thirty years have been really good! Poverty, health, education - everything has seen improvement. Question posed to 'Malthusians' [[even though none of the prominent environmentalist activists and academics who write books and deliver talks about the threat of climate change and ecological catastrophe see Malthus as an inspiration, or even cite Malthus as a source (because they know that his model was highly flawed as a guide to today's world (see, for example, Jared Diamond's discussion of this point in Collapse)), ppl like Michael Shermer seem to think it makes sense to use this label to describe anyone very seriously worried about what we're doing to the environment]] : 'Science/the data says things are getting better, so how can you maintain such a pessimistic attitude? The null hypothesis is that we're going to continue using human ingenuity to solve our problems! Look at the data!'

Step C) Neolib says 'Yes, we need carbon taxes but because of [A] and [B] there is absolutely no need to panic (and no need to vote for anyone like Bernie Sanders!!!)

A lot of people buy into this line of argument, but it’s actually unsound. First of all, Hans Rosling’s statistical summaries (and others like them) do not show that things are ‘getting better’. What all of us now know, thanks to people like Mr. Rosling or Steven Pinker, is that the level of extreme poverty and illiteracy in the world has gone down a great deal over the last thirty years (what’s underemphasised, of course, is that the most astonishing leaps cluster in those South East Asian countries that defied IMF advice on capital controls and liberalisation, which casts serious doubt on the narrative that it has anything at all to do with Neoliberal policy (especially seeing as, in the West, many of the same trends over the same period look negative! (see my previous post on Ann Pettifor called “Hans Rosling shit does not vindicate global neoliberalism”))). This still leaves it open as to what level of credence one should have that those happy trends will continue. Your credence should be high that these happy trends will continue only if you have reason to think that the mechanisms that underlie these trends are stable. However, I think that it is irrational to maintain high confidence that human ingenuity and human capacity for social cohesion in the face of adversity will triumph over the effects of environmental degradation.

Why do I think this? Well, let me just say that it seems to me like the assumption of continuity in this case is the extraordinary claim. What reason does one have to have high confidence that even as climate change and pollution wreaks a greater and greater toll on our planet – even as coastal cities are increasingly beset by floods, even as formerly crucial agricultural areas are stricken by major drought, even as millions of people in countries like Bangladesh are forced to migrate to escape flooding, even as the perennially desperate drought-situation in the Horn of Africa becomes yet more desperate, even as our major world cities acquire increasingly toxic air and respiratory diseases skyrocket, even as the microplastics in our bodies reach the point that they’re doing serious damage – our societies will remain more or less stable, there will be no war between major powers, and there will be no major political crises? Why have high confidence that disaster does not await? Why have even moderate confidence? Maybe people will say something about geo-engineering, or they’ll say we’re going to get to Mars. Well, geo-engineering is actually fucked up and a total last resort; and nobody is going to have a successful pregnancy and birth in the massively irradiated, bone-density-thinning, muscle-atrophying atmosphere of space (and any baby that survived would be fucked up, probably physically and mentally impaired). No, as awkward as it is, we kind of need this planet to not be like Venus; we kind of need to avoid making everywhere on earth look like Henderson Island.

Here’s another reason why the graphs don’t suffice:

One rather disturbing fact about the data on wars over the last few hundred years (which Steven Pinker completely elides for the sake of his grand narrative) is that, even as the frequency of major conflicts is seemingly ‘on the slide’, the intensity of these conflicts, the scale of the bloodshed and the amount of deaths, is increasing (‘technology’ is a more or less adequate one-word explanation for this “power-law” distribution). In fact, it is probable that the knowledge that another world war could wipe out the world helps explain why we saw such a historically unprecedented level of international co-operation and diplomacy after World War II (but, if I recall correctly, Pinker does not even entertain this thought).

 One of those classic quotes attributed to Einstein which I mention often in my posts on this blog really sums up my thoughts on this: “I know not with what weapons World War III will be fought, but World War IV will be fought with sticks and stones.”

Albert Einstein, in an interview with Alfred Werner, Liberal Judaism 16 (April-May 1949), Einstein Archive 30-1104, as sourced in The New Quotable Einstein by Alice Calaprice (2005), p. 173.

Also, as Chomsky details in Who Rules the World? there were actually several major nuclear near-misses and it’s kind of crazy that we’re all still here (anthropic principle? Are there many worlds?).

As usual, this is a structureless blob of a post. At least it’ll have a spicy ending:

I feel like, in my time, I have seen several Ted talks by people who love talking about ‘the data’ (https://youtu.be/-yFhR1fKWG0?t=7m25s) where they discuss the ‘surprising fact’ that you can seemingly plot human ‘technological progress’ as an exponential starting from roughly 100,000 years ago.

Why do they never discuss the fact that all exponential growth patterns in nature end abruptly?

Corruption in the Wake of GFC: Obama's Role

Extracts from Chapter 17 of Killing the Host, “Wall Street Takes Control and Blocks Debt Writedowns”: Obama’s Moves post-GFC

“What voters wanted in the U.S. 2008 presidential election was a change away from multi-billion dollar gifts to Wall Street and the Cheney-Bush foreign military adventures. Barack Obama presented himself as the “hope and change” candidate. In an atmosphere shaped largely by public anger at the bailouts, he and other Democrats spoke of writing down mortgages for underwater homeowners, rolling back bank salaries and bonuses, and re-empowering the regulatory agencies that the Reagan, Bush and Clinton administrations had gutted. Congress had not written any of this into its TARP legislation or pressured government agencies to limit how banks could spend the giveaways they received. The hope was that this would change with a strong voter mandate that gave Democrats control of the House of Representatives and Senate as well as the presidency. The political path was open to enact far-reaching reforms.

Obama quickly slammed the door shut. Although having run on a populist platform, his role was to deliver his Democratic Party’s liberal constituency of urban labor, racial and ethnic minorities, environmentalists and anti-war advocates to his campaign contributors. Over the past half-century the Democratic Party’s strategy has been to create a menu of promises in two columns. Column A reflects the hopes and changes that voters want. That is the platform on which the Democrats ran. Column B represents what the party’s major contributors and lobbyists want. Obama won the election by verbalizing the hopes of the 99 Percent, but did in practice what his campaign backers from the One Percent wanted. His language was populist, his policies oligarchic and aimed to prevent change.

Adept at applying this about-face with grace and a smile, Obama named former investment banker Rahm Emanuel his chief of staff to stifle the party’s left wing, and appointed Clinton’s old Rubinomics gang to key policy positions, headed by Larry Summers as chief economic advisor, and Geithner at Treasury to block bank regulation or debt writedowns. Instead of responding to public aspirations to appoint regulators of Wall Street, the top administrative bureaucracy was drawn largely from Goldman Sachs and Citigroup, excluding anybody as truly regulatory as the Bush administration’s Sheila Bair or Neil Barofsky.

Post-2008 economic policy became that of the campaign contributors who comprised the Wall Street financed Democratic Leadership Council under Clinton. The continuity runs from the Clinton to Obama administrations via the economic policy of Summers and Jack Lew, another Rubin colleague. At the Justice Department, Eric Holder and Lanny Breuer blocked prosecution of bankers and pulled funding from FBI or Securities and Exchange Commission investigators of financial and corporate fraud.

Obama’s naming of a Wall Street-approved cabinet showed his intention to block the reforms that most voters backed and expected, headed by debt relief. What voters got after 2008 was financialized “deep state” concentrating more wealth in Wall Street’s hands; no follow-through on Obama’s airy talk of raising the minimum-wage; and a drive to reduce the federal budget deficit at the expense of Social Security and other New Deal economic programs instead of public spending to fuel recovery.

Assigning financial policy to Geithner to block debt relief

Obama left economic policy to the Treasury, assigning Secretary Geithner the pro-bank role that Rubin had executed under Bill Clinton. Geithner already had served Wall Street as President of the New York Federal Reserve, whose website describes its “core mission” as being in part to “supervise and regulate financial institutions in the Second District” centered in New York City. Geithner promised his Congressional questioners at his March 2009 confirmation hearings that he had refused to perform his designated task: “First of all, I’ve never been a regulator … I’m not a regulator.”

What then was his job? Sheila Bair and Neil Barofsky have described his actions to circumvent public regulations, first at the New York Federal Reserve and then as Treasury Secretary, lying outrageously to defend Citigroup. Citigroup’s chairman Robert Rubin had sponsored Geithner to head the New York Fed, and had bene grooming him to become Citigroup’s CEO as George W. Bush’s administration was ending. But rumor has it that Geithner was asked to defer his “descent from heaven” into Wall Street’s high salary world in order to become Treasury Secretary and protect the banks (especially Citigroup) from what were feared to be Congressional pressures to regulate it more in the public interest.

Geithner quickly set to work crafting an even more bank-friendly policy than his predecessor Paulson had done. Under Geithner’s direction bailout funding was made unconditional rather than subject to regulatory tightening. No firing of management, or even a cutback in salaries and bonuses. No cleanup in shady mortgage practices. (The MERS (Mortgage Electronic Registration Systems) scandal unfolded with zero government protection of homeowners against false bank documentation of just who owned the mortgages and how much was owed.)

Just how remarkable a feat this subversion of regulatory cleanup was is reflected in thef act that by April 2009, TARP Inspector General Barofsky had “opened twenty criminal fraud investigations into the $700 billion program” and its “cash for trash” dumping of junk mortgages on the Fed and Treasury. An early report “sharply criticized the government for failing to hold financial institutions accountable” for the money they were given.

[…]

Geithner’s undercutting of TARP showed that despite protests from Congress and the public, Wall Street could still get away with theft. Refusing to enforce reforms, Geithner became bolder as he saw his actions backed by President Obama, Chief of Staff Emanuel and Democratic congressional leaders. Former IMF economist Simon Johnson observed that troubled banks usually “are ‘cleaned up’ as a condition of official assistance, either by being forced to make management changes or being forced to deal with their bad assets. (This was the approach favored by Ms. Bair when she was at the F.D.I.C … The idea that there was no alternative to Mr Geithner’s approach simply does not hold water.)’”

Obama’s false promise to write down bad mortgages

Nowhere was Geithner’s unconditional support for the banks more blatant than in his neutering of President Obama’s promise to reduce the debts of underwater homeowners in the Home Affordable Mortgage Program (HAMP). When $50 billion in TARP funds were committed in 2009 to help homeowners through HAMP, Obama announced his intent “to help up to 4 million struggling families stay in their homes through sustainable mortgage modifications. Hundreds of billions more were still available and could have been used by the White House and the Treasury Department to help support a massive reduction in mortgage debt.” In fact, as Barofsky reports in his book Bailout, “the conflicts of interest baked into the program would render it ineffective unless principal reduction was made mandatory.”

Geithner pretended that “the losses that the banks might suffer on their first and second mortgages could push them into insolvency, requiring yet another round of TARP bailouts.” Instead, he insisted that lenders be compensated for their losses on “liars’ loans.” Supported by Geithner, the banks banded together against underwater homeowners. “The message was clear,” Barofsky concludes: “No way, no how would Treasury require principal reduction, even when Treasury’s analysis indicated it would be in the best interest of the owner, investor or guarantor of the mortgage.” President Obama permitted Geithner and the Treasury to block the HAMP, derailing hopes for a housing recovery by leaving “it to the largely bank-owned mortgage servicers (and to Fannie and Freddie) to determine if such relief would be implemented.” The effect was to leave the economy debt-ridden rather than writing down mortgages.

A conflict of interest between banks and homeowners was inherent in the HAMP program. In addition to their first mortgage, many homeowners had taken out “equity loans” as a second, subordinated mortgage – that is, second in line to be paid in case of default. Often the same bank held both mortgages. Because first mortgages are the first in line to be repaid, “secondary” creditors bear the loss if a debtors defaults – which is why these second mortgages almost always bear a higher interest rate.

Banks used government subsidies to write down first mortgages (for which the government reimbursed them!) so that they could enable homeowners to continue paying their equity loans or other second mortgages in full, The banks thus were able to collect on liars’ loans that were not subject to government reimbursement, thanks to the fact that “the initial plan didn’t require the banks to write down second liens they may have held – like home equity lines – from borrowers whose original loans were modified.” [Gretchen Morgan]

To dilute public support for writing down underwater mortgages, bankers and Geithner mounted a propaganda campaign to pit debtors against each other. Their divide-and-conquer ploy was to characterize homeowners with negative equity – but who still had enough income to afford to pay for their mortgages – as free riders. It would have paid for such individuals to walk away and buy a similar home at a lower price, leaving the banks holding the bad mortgage. But bank lobbyists and the Treasury tried to goad the homeowners into staying current on their payments, even when their mortgage debts were more than the home was worth. Warning about the “moral hazard” of “irresponsible” mortgage debtors getting a free ride, banks incited “responsible borrowers” to resent debtors who were offered relief for mortgages larger than the market price would cover.

Bair accused Geithner of using the “moral hazard” argument in a one-sided way to buttress this double standard. “Saying that he didn’t want to reward the behaviour of those who knowingly got in over their heads,” he had “no such concern for the mega-banks.” Ultimately at issue, she concluded, was “whether our financial system should be based on a paradigm of bailouts or on one of accountability.”

Geithner’s opposition to debt writedowns shows that instead of seeking to create a viable financial balance, the Treasury promoted a one-sided financial grab by Wall Street, leaving the economy in a debt trap. Matters got much worse when banks saw that the Geithner-Obama program enabled them to make much more money by foreclosing (and running up fees and penalties) than by writing down debts.

[…]

Obama’s smoothness in misleading voters

One of the first books giving an intimate look inside the Obama Administration, Ron Suskind’s Confidence Men, reported that on March 27, just two months after taking office on January 20, 2009, the new president invited the executives of thirteen leading Wall Street institutions to the White House. After listening to their arguments for why banks had to continue paying bonuses (ostensibly to get the best talent to manage their money), Obama told them: “Be careful how you make those statements, gentlemen. The public isn’t buying that.” He explained that only he could provide them with the political shield needed to forestall public pressure for reform, not to mention prosecution of financial fraud. “My administration is the only thing between you and the pitchforks.”

One leading banker attending the meeting told Suskind: “The sense of everyone after the meeting was relief. The president had us at a moment of real vulnerability. At that point, he could have ordered us to do just about anything and we would have rolled over. But he didn’t – he mostly wanted to help us out, to quell the mob.” As Suskind summarizes the result, which would shape the incoming administration’s policy: “Obama had them scared and ready to do almost anything he said…. An hour later, they were upbeat, ready to fly home and commence business as usual.”

Obama smoothly marketed his policies defending Wall Street in his interview with Steve Kroft on CBS’s “60 Minutes,” broadcast on December 13,2009. Shedding crocodile tears over the fact that bankers have not shown “a lot of shame” about their behaviour and outsized remuneration, the President tried to gain sympathy by showing that he knew very well why voters “are mad at the banks. Well, let’s see. You guys are drawing down $10, $20 million bonuses after America went through the worst economic year that it’s gone through in decades, and you guys caused the problem. And we’ve got 10% unemployment.”