Misleading Old Ideas

Let’s take a fairly simple idea. The one that follows is often heard repeated as the justification for cutting taxes. The idea: cutting taxes leads to investment; investment leads to hiring; therefore cutting taxes creates new jobs. Does this idea have actual merit? Well, it all depends on what you mean by the word “investment.”

Investment can mean buying newly issued stock, the corporation issuing them intent on raising capital for a new factory, say. If that is the “investment,” it may well eventually result in people being hired—for building the factory and then for staffing it. But most purchases of stock are not of this sort. We buy stocks already on the market. The result is that the price of the stock rises or falls.

Another kind of investment is when capital is expended on a merger or acquisition (M&A). When companies merge or acquire each other, the usual motivation is negative. The buyer’s growth or profits has been lagging. It acquires another company to get access to its market. That might restore growth—and also result in higher profits by laying off people who are no longer needed. This is often possible if services common to both organizations can be combined. In most M&A cases, job are lost, not created.

Now let us take a look at these two cases. In 2015, total US M&A activity was valued at $2.413 trillion (link), thus, to underline it, 2+ trillion dollars was spent on companies buying companies.  In the same year, total venture capital expenditures were valued at $77.3 billion (link) in the United States. If we add those two numbers, we get $2.49 trillion; of that total, venture capital expenditures were 3.1 percent.  The net result is that of 100 percent of corporate investment, nearly 97 percent was spent on activities most likely not to change employment at all or to reduce it—the reduction coming from the staff reduction as the two parties to the merger make it more efficient. Only 3 percent went toward activities highly likely to be translated to new jobs.

It’s dangerous to put one’s faith in simple ideas taught in Economics 101. In the age we live in, where M&A activity globally has averaged $3.85 trillion every years since 2007, the concept of “investment” has lost all meaning. And to that large average number must be added the totals of every year’s stock market transaction—which have virtually nothing to do with job creation.

Buster Bunker

The new product that I propose somebody should bring to market would be made of very thick concrete. It would be shaped like a telephone booth, but lower in height. Inside it would consist of a decent light and a comfortable seat. The purpose of this bunker will be to accommodate people over a certain age; it would be wide enough to allow them comfortably to read a newspaper. If, reading the morning papers, the occupant  suddenly burst apart from rage, skin, skull, heart, and lungs all spattering in every direction with enormous force, the thick walls of the Buster Bunker would keep all this bio-debris contained. Upscale models would also come with a built-in CPM (that stands for “corpse collecting module”); it would wash down all this debris with alcohol and burn the whole mess. Fine-tuned automated bottling and sacking machinery would collect gases and solids and prepare them for shipment to one of several Fortune 500 companies pre-selected by the former owner. Yet another special feature would be a flashing light on the outside, green for women, red for men. If the green light flashes, you’ll know that grandma is no more—but the little place where she lived is still as spic and span as it was when she got up that morning to read the paper.

Motivation for this invention? Well, today’s headlines are a good example. Today we learned that along with such things as Social Security and Medicare, our newly minted Administration’s budget would also eliminate Public Broadcasting, the National Endowment for the Arts, AmeriCorps (community services), and Legal Services Corporation (legal aid for the poor), and other valuable if small agencies that help those potential green and red lights. We don’t own a Buster Bunker yet, hence we’ve had to contain our rage at these proposals.

Come to think of it, Buster Bunkers ought to be built and distributed, and their operations subsidized by Federal Dollars. That would also help with freeing up a lot of housing and control population growth. The cost of a Buster Bunker should be kept to about $13,130—with an additional $500 for a CPM. Let those who’d have to clean up the mess pay for that additional but obviously useful component.

Unholy Sanction

For what will be obvious reasons today, the word “sanction” caught our attention. To be sure, this piece may be read three or four years from now, its context completely forgotten, so here is the context: General Flynn, Trump’s National Security Adviser, resigned last night, evidently over accusations that he had discussed “sanctions” with the Russian Ambassador. The resignation was announced by the New York Times at 11:06 pm, whereupon the cable media went into a kind of melt-down trying to process the sudden, alarming, and indeed seemingly EXPLOSIVE news. This kept Brigitte and me up later than usually. In three years all this will all seem weird at best.

But back to that word. In a nut shell, the word can have two meanings: (1) it is a decree or ordinance which permits something to be done—as in “You have our sanction to proceed”; and (2) a negative order or laws (along with consequences) which penalizes something that has been done—as in “The United States has passed sanctions against Russia for its Crimean invasion.”

Both meanings are reported by Online Etymology Dictionary. The second (negative) sanction is there said to have been first used in 1956. Nothing more is said. But the date has puzzled many word lovers before it puzzled me this morning. 1956? Come on. So what is the root of that date—never mind the word sanction.

The big global event in 1956 was the Suez Crisis. It began in 1956 when Egypt’s Nasser nationalized the Suez Canal. In response, Israel, joined by England and France, invaded Egypt. The United States under Eisenhower, joined by the Soviet Union and the United Nations, opposed this move (or let’s say that they failed to sanction the invasion). This failed sanction may be at the root of dating negative sanctions as first entering the dictionaries of the English language. The history is not cited by linguists; what they have to say is presented at this interesting place (link). In his 1956 State of the Union Message, however, Eisenhower did use the following words:

In all things, change is the inexorable law of life. In much of the world the ferment of change is working strongly; but grave injustices are still uncorrected. We must not, by any sanction of ours, help to perpetuate these wrongs.

Could that be the original framing of a negative sanction made some time before Eisenhower actually used such a sanction against the Israeli-English-French invasion of Egypt?

Sanction derives from the Latin sanctionem meaning “act of decreeing or ordaining” and confirming the enactment of a law. The application of this word in ecclesiastical decrees, not least the bestowal of sainthood on the deserving, gives us the sense that sanction is somehow related to sainthood and the sacred. That sense is more or less correct. We certainly have a holy sanction which makes the saint—and the unholy sanction which can cost a general his job.

Remembering my Etiquette

When you ponder it a little more than superficially, the phrase political correctness is a tautology. Thus the word “political,” by itself, already contains the sense of “correctness.” Deep down the two words mean “the same” (tauto in Greek). But let me extend this by looking at two words that seem to be related: political and polite. Political is rooted in the word “citizen,” polites in Latin; and that last word derives from polis, “city.” At this point “political” is not in any genuine sense equivalent to “correctness,” of course, but let us plow this furrow deeper. One idea might be to check if the words politic and polite both come from the same root; but that turns out to be wrong. Polite comes from the Latin politus; in spelling that word is almost identical to “citizen” (polites) but its meaning is “polished,” refined, hence elegant and  accomplished. The word politic, however, despite its strong linkage to citizen in Latin, had acquired the meaning of “prudent, judicious,” by the 15th century, no doubt because a citizen must have those characteristics in order to get things done. In English, as well, we get the word “civil” from citizen; and civility relies on prudent and judicious behavior. Polite behavior, although derived from polishing rough things until they’re smooth, has functionally the same meaning. A polite person will always be politic, civil, thoughtful, and considerate. Tautology.

Now we could take this even further (always true where language is involved). The hardnosed critic of political correctness will point out that “correctness,” as used in that phrase, does not mean adherence to truth, necessarily; rather, it means obedience to a ideology, whether that ideology is true or not. And that’s also true. The phrase came into use for that reason, I think: to enforce an ideology. An alternative was already available when it was introduced: it was  etiquette. Etiquette retains, to this day, the meaning of “correct behavior” whether in politics or other spheres of life.

Etiquette literally means a small slip of paper, a ticket, you might say. It comes from Old French estiquette, which simply meant a label. Etiquette, in the sense of “prescribed behavior” (notice behavior, not belief in anything) developed from “label” because people visiting courts (be they in France (étiquette), Italy (etichetta), or Spain (etiquette) were handed little cards on which the basic right behavior was printed to be learned. Similarly, soldiers assigned to be lodged in a village, temporarily, were issued a similar ticket with similar instructions on how to behave.

Etiquette is about such things as rising when a lady or elderly person needs a seat, which spoon to use, when to bow, when to speak, who goes first, what words may or may not be used (and here we are approaching but not reaching political correctness)—and never mind what you would rather do—like putting your muddy boots up on that beautifully laid Downton Abbey dinner table.

By combining “right behavior” with “prudent and judicious” speech, we might get political etiquette, a nice correction in the course on which we are now headed—a rough beaching on some arid sandbank or worse. No one possesses etiquette automatically; I remember my childhood. To do so you have to be brought up right. One has to have acquired manners—and education enough to understand the meaning of correct behavior until it becomes instinctive. And it doesn’t harm you if you read and study a fair amount to discover that you’re not born wise.

My source for etymologies and historical precedents comes, as always, from Oonline Etymology Dictionary (link).

The Sun is Shining!

The good Lord has decided to do the unusual. He waved a finger ever so slightly so that something we haven’t experienced in what seems like a month, but was surely at least three weeks, the grey skies have vanished and a bright sun shines this morning in celebration of Brigitte’s birthday. Not a cloud in sight—and it now seems that Folklore, which asserts that the sky is blue, must be true after all. Yes, even here in Mordor. Thank you, Lord. We know you love us. And a little hint of that will let us endure a lot for a long time to come.