I didn’t say I don’t care. Of course I care about children dying. I just don’t particularly care. I don’t actually know them or their families. Children are dying violent deaths every day all over the world. I don’t mean to be dismissive about it. I literally cannot mourn them all and still be a functional human being. What is disturbing to me is the sense that this event is deserving of special recognition all over the country, and to only a slightly lesser extent in other countries with predominantly white populations. I would hope folks would appreciate my honesty but I don’t expect brownie points for it.

Obama has ordered drone strikes that have killed over 180 Pakistani and Iranian children. I care about those kids as well and I have talked about it on several occasions with what small voice I have, but that’s about it. It’s not getting anywhere near the media attention of this event involving American children and I realize I’m pretty powerless to do anything about that. It’s frustrating, but it would be exponentially more frustrating if I deluded myself about my ability to change it.

The massive public display of crocodile tears over this event isn’t going to change anything (for the better) either, but I’m sure that’s a common justification for these hysterics–that this is close to home and therefore we have a chance to prevent it in the future. You probably have a better chance of preventing the further deaths of those foreign children, which is to say, “not much”. But their murderer is still alive and at least theoretically subject to political pressure for his choices of actions. That problem appears to have a simpler answer.

It seems like folks don’t have any idea how to prevent something like this from happening again so they’re trying to find a convenient scapegoat for a very complex and endemic problem. Meanwhile much of the media is milking the emotional reaction that racist and nationalistic people are inclined to have over an incident like this. This kind of special attention might actually be making these events more likely. This piece by Marilyn Manson deserves a re-read. It’s what inspired me to write this, actually.

Don’t get me wrong. There’s hope for a better future to be sure, but I think it’s a setback when we oversimplify the problem. I already see an attempt to address this in a surgical manner. TV reporters are interviewing friends of the family and people are speculating wildly about what THE problem was with this particular child’s circumstances. I could come up with a whole list of problems about our culture that contribute to depression and to aggressive and/or suicidal feelings in kids–schools and adults in general treat kids like prisoners or slaves and suppress their personal expression, don’t let them have a voice or even chastise them for expressing an “incorrect” opinion, don’t respect their choices if they’re at all non-traditional, etc. My personal bias is already showing. The point is, it would be quite egotistical for me to think I was more than barely scratching the surface of how to prevent something like this from happening again so I have no excuse for such blatantly racist and nationalist behavior as to express a particular sympathy for these families whom I don’t know over the hundreds of other families I don’t know who have lost children to violence.

Post your angry comments below. I hope it’s cathartic for you.

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USDA suggests food stamp parties, games to increase participation

Every $5 in new SNAP benefits generates $9.20 in an additional community spending,” the USDA contends in their outreach guidance. “If the national participation rate rose five percentage points, 1.9 million more low-income people would have an additional $1.3 billion in benefits per year to use to purchase healthy food and $2.5 billion total in new economic activity would be generated nationwide.

Plurp experiment with hydrogen and a lit splint

Keynesians are like those gullible folks who believe the ads trying to get them to buy plans on how to power a car with water. It’s true that water is made of hydrogen and oxygen which can be burned for energy. The problem is you have to use more power to separate the two from water than the energy they generate when you burn them which recombines them back into water. Hydrogen and oxygen, only while separated, have potential energy that is lost to heat once it has burned and combined into water again. The overall loss is inevitable due to imperfect efficiency. Even if your conversion were somehow perfectly efficient, you’d only get back exactly the energy you put into it, which represents no benefit at all.

It’s like they studied just enough science to make it through the high school experiment where you separate water into hydrogen and oxygen via electrolysis and stick a lit splint into the test tube of hydrogen and it burns and goes “plurp”. Meanwhile, they never got around to studying the Laws of Thermodynamics, which are, let’s just say, kind of important.

Consequences of the Laws of Thermodynamics

The laws of thermodynamics tend to be fairly easy to state and understand … so much so that it’s easy to underestimate the impact they have. Among other things, they put constraints on how energy can be used in the universe. It would be very hard to over-emphasize how significant this concept is. The consequences of the laws of thermodynamics touch on almost every aspect of scientific inquiry in some way.

Meanwhile, Keynesians know just enough economics to hang themselves and the rest of us along the way for similar reasons. They haven’t bothered to familiarize themselves with the Broken-Window Fallacy, or else just decided to ignore it because it didn’t suit their fantasy view of an economic model where someone at the top just pushes buttons and fixes everything. Now, I realize I’m stretching the primary point of the Broken-Window Fallacy which addresses the absurd belief that damage to infrastructure can have a net benefit to the economy. But the basic point remains — that you can’t achieve an overall benefit to an economy by taking resources out of it and then putting them right back in somewhere else when the very act of moving the resources in this manner uses up resources. This is inevitably a net loss.

I’m not trying to poo-poo the benefit of food stamps to make sure the poor get fed–not right now, anyway. Let me just concede for the moment that it may be a necessary and hopefully temporary evil to help people in need only because I don’t want to get sidetracked into another subject. However, if you think broadening the food stamp program will actually have the added benefit of stimulating an economy, as is referenced in the article above, you have failed to read or grasp this basic principle which is as important an idea to economics as the Laws of Thermodynamics are to science. It’s like saying we’re going to make everyone financially better off by taking resources away from some people and then giving resources back to other people but in smaller amounts. They have to pay all those paper-pushers and bureaucrats after all, and as with any government program, that usually costs more than the benefits going out to recipients. The bureaucratic costs in this case are analogous to efficiency loss in the energy-conversion example, significant losses at that. They’re spending 2.5 million just on ads before even considering the administrative costs!

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I posit that money can be looked at as a promise. Let’s say I want you to fix my car and I offer you cash in return, in this case, Federal Reserve Notes (FRN). Those actual pieces of paper are bordering on useless. The reason you might be willing to accept this exchange is because you’re expecting to be compensated with something you really want later. The notes represent a promise of delayed compensation. Let’s say you buy clothes with the cash. In effect, I traded you some clothes for fixing my car. Let’s say I sold some vegetables that I grew in my garden. I effectively traded vegetables for the promise of getting my car fixed. Money represented promises that allowed for an elaborate trade between multiple parties and got everyone what they needed.

I know a lot of people aren’t fans of FRNs and I’ll talk about that shortly, but the same applies with gold, for example. Most people have no personal use for gold but they know that someone out there does want gold to make jewelry or stereo cables or for countless other applications. It’s very possible neither you nor I personally have any use for gold, but we see it as a promise. We know we can trade it to get something we personally value later. The fact that it packs a lot of value into a small, practical size, that it endures well, and is hard to counterfeit make it good money, a tool for making that promise of compensation at a later time.

If we accept that money is basically a promise of deferred compensation, that has a lot of ramifications. How much is a promise worth? That depends on how much we feel we can trust that promise. If a total stranger promises to return something of value to you later, the value of that promise is more questionable than if a trusted friend makes the promise. On the other hand, if someone you know has broken a lot of promises in the past, their promise might be worth even less to you than a stranger’s. Picture a friend who gets what he wants by making a lot of promises that he has no intention of keeping. He can probably skate by for a while and appears to get something for nothing, but eventually the gig is up and no one trusts him. He stopped dealing in promises and started dealing in fraud. So what ramifications does that have for money?

Money is only as good as the promise it represents. One could easily argue, and many often do, that gold is a much more reliable promise than an FRN. For instance, because FRNs are easily produced in massive quantities, they are becoming less scarce and therefore are worth less over time. The longer you wait, the less compensation you will get for whatever you traded to get that promise.

Here’s another way to look at the promise of FRNs. If I know that a third party is going to intercept a portion of whatever you offer me for my goods or services, your promise is already somewhat broken, even though it’s not your fault. If 10% will be gone due to taxes before I can get my deferred compensation from a trade, then any promise made to me in the form of FRNs is 10% broken right from the start. If I want a dollar an apple and you have 10 dollars to buy apples, it makes sense for me to only offer you 9 apples because your promise has been devalued by the taxation of a third party.

This gets even more diabolical when you start trying to manipulate money, even with very good intentions. You’re manipulating promises! Let’s consider some wealth redistribution in the form of a graduated income tax. Let’s say Susan gets taxed at 10% at her income level and Tom gets taxed at 30% at his higher income level. This is intended to help Susan out which doesn’t seem like a bad goal. If Tom wants something from Susan, his money, his promise of deferred compensation to her is worth 90% of face value. If Susan wants something from Tom, her money is only worth 70% of face value to him so now he only offers her 7 apples for $10. You might see how this can trigger inflation.

If you’re the third party taxing Tom higher than Susan because she’s poorer, you might get really angry with Tom for raising his prices in response. She’s in need after all. Maybe you could force Tom to fix his prices. You could view his raising prices as a type of tax evasion, a way of dodging what is an attempt to help out the poor. That gets us to another way of looking at what money is.

When we talk about trying to get other people to do what we want, like Tom in this case, a familiar analogy is the carrot and the stick. Pretty much every form of motivation breaks down into either positive or negative reinforcement. The stick represents negative reinforcement in the form of violence or the threat thereof. The carrot represents an incentive, such as money. The price-fixing alternative, when Tom tries to adjust for the fact that Susan’s promises aren’t worth very much, is the stick. If you don’t threaten him with punishment to gain compliance, Tom is free to ask whatever he wants for his goods and services. When you break the promise of money, you’re resorting to the stick.

Here’s a simpler way to look at wealth redistribution as a means to an arguably good end. If Tom has a lot of money, what does that mean? Does it mean he has a lot of food that could feed the poor? Does it mean he has a lot of homes that could house the poor? No. It only means he is owed a lot of promises!

It’s very tempting to look at numbers in his bank account as a resource that can be tapped to solve an array of problems, but once you understand money to be a promise, it’s apparent how delusional that is. Money is an ethereal thing; not a broadly-useful resource in and off itself. To the extent that you take money from the “rich” to give to the poor, you are devaluing the gift itself in the process. You are trying to compensate the poor with broken promises. Can you take money from the rich and hire more doctors and nurses so we can provide healthcare for free to the poor? Certainly… for a while. The problem is you’re devaluing the very money you’re paying those employees with.

You can’t build a sustainable economy out of broken promises. When it comes down to it, if you want everyone to have food, regular people will have to grow it. If you want more people to have healthcare, you’ll need more people working as doctors and nurses. These new creators of palpable resources will have to be paid with something. Meanwhile, if you raise taxes or print money to do that, you’re devaluing money. It’s a vicious economically cannibalistic cycle in which the carrot of money is increasingly meaningless, everyone gets poorer, and the stick is all that remains to try to keep people producing and avoid an economic collapse.

Money is keeping promises. Keeping money good requires honoring commitments. The alternative to money is fraud or violence. So in that context, what is money?

Money is peace.

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