Saturday, December 22, 2012

The Newtown shooting and the NRA


However, what I found telling was the NRA’s failure to consider what it means to provide children with a psychological sense of safety. Armed guns will protect their physical security, but they threaten to bring into the child’s view and experience the belief and fear that the world is dangerous, filled with bad people who can harm them. Why else have armed guards in the school building in the first place? In other words, what the NRA did not recognize is our shared hope that we can protect a child’s innocence; that is, an experience of the world as a loving place, where strangers are friendly, authority is dependable, optimism is realistic, curiosity is rewarded, and of course armed guards are unnecessary.

But having noted this lapse, I can also ask, whether or not we adults, as bearers of our culture, any longer believe that children are entitled to their innocence. There is a sizeable literature, think of Neal Postman’s prescient, “The Disappearance of Childhood,” published in 1982, which argues that we have created a social world that undermines the experience of childhood innocence. Children are told to be wary of adults who touch them, lest they be abusers, and they are exposed to sexual stimuli as well as fantasies of violence throughout their childhood. In our anxiety for their future we overschedule their lives with programmed activities, and test preparation sessions, so that they experience little spontaneous play. Many children are also exposed to our psychological conflicts when, as parents, we divorce one another and then fight over their custody. The television series, “The Wire,” a story of Baltimore as a decaying postindustrial city, and widely regarded as realistic, highlights how some African-American children are far too soon introduced to the world of adult violence, ineptitude and corruption.

The list could go on, but do we care?  In others word are we committed to sustaining the experience of childhood innocence? One reason we might not be is because as adults we no longer feel psychologically, financially or physically safe ourselves. As a result we are pulled toward protecting ourselves rather than our children.  The psychologist David Bakan, argues in The Slaughter of Innocents,” that throughout history adults abandoned infants when faced with food shortages. Children in other words, potentially distract us from our own struggle for survival.  While in the developed world we have ample food, the anxieties associated with securing an adult role that confers dignity, purpose and a livelihood, have grown substantially. This may be one reason why birth rates are falling throughout much of the West. Perhaps the NRA's conviction that monsters threaten us and our children, represents, in an exaggerated form, a widely held belief that the world has become more dangerous for adults.  

If this is true, one question then is how one makes sense of danger? I want to suggest that the NRA’s philosophy, or perhaps theology, is based on the idea of an evil presence in the world, which, if and when acknowledged, makes innocence seem delusional. Harlon Carter, who helped “overthrow” the NRA’s “old guard” in 1977,  attacked it using the discourse of good and evil. “The latest news release from the NRA,” he said, "embraces a disastrous concept, that evil is imputed to the sale and delivery, the possession of a certain kind of firearm, entirely apart from the good or evil intent of the man who uses it.” This discourse of evil is also why LaPierre referred in the press conference to “predators and monsters,” rather than, for example, to mentally disturbed people. In this sense, the discourse of evil stands in contrast to the discourse of disease and health. The idea that Adam Lanza, was mentally disturbed, in other words, he had a diseased mind, can be usefully challenged by the idea that he, or much more likely, his mother and first victim, was evil.

Does the idea of evil have standing? Scott Peck, the psychiatrist and religious thinker, wrote a widely read book, “The People of the Lie,” based on the idea that evil people are hidden, their impacts insidious, and that through their failure to tolerate imperfection in themselves and others, they often drive others, particularly children, into acts of desperation. The book, published in 1978, in this sense might be read as a précis of the Newtown shooting.

The idea of evil is not compatible with the belief, that if social conditions are right, fair and just, people can be perfected. This belief has been the basis for much modern social policy as well as the foundation for tolerance and for a commitment to pluralism. My own sense however is that idea of evil remains unsettled within us, we are so to speak “bedeviled” by it, as we contemplate not simply the Holocaust, but more recently, the slaughters in Rwanda, in Bosnia, and the attack on women in parts of the Muslim world. Certainly, the psychoanalytic conception of character holds that loving and destructive feelings are comingled in our most intimate relationships. This is one basis for domestic violence. In other words, one hypothesis is that we are dishonest when we project our own struggle with the idea of evil onto people and groups, like the NRA, whose view of it we then label as extreme.

The belief that evil is real and insidious can certainly give rise to the conviction that we must defend ourselves against evil at all costs. But one question is why we can’t rely on the state. the government, to protect us against evil. Certainly, in the NRA’s worldview, the state cannot be counted on, and in fact may become the enemy. This is why its leaders put such great store on one interpretation of the U.S. constitution’s second amendment; namely that it protects the right of people, “to keep and bear arms.”

It is tempting to dismiss this as paranoid thinking, but surely one trend in the wider world is the apparent decline of states and the rise of non-state actors, such as terrorist organizations and criminal networks fully capable of attacking and defeating police forces and armies. In the U.S. we need only look southward to our neighbor, Mexico, to envision a scenario of how criminal gangs, wealthy and armed, might defeat the state. Moreover the conspiratorial idea that the United Nations is the first step toward global domination by hidden powers, an idea that attracts some NRA members, bears a family resemblance to the idea that the global corporation, which under certain conditions can equip private armies, is growing more powerful than the states that regulate them. Truth be told, in the United States, outlaws have often successfully challenged, defeated and corrupted the state. Think of outlaws on the western frontier, the Mafia in Chicago, whose leaders undermined judges and policemen with bribes and threats, or local urban police who, in decaying industrial cities, abandoned high crime areas to criminals.

I am reminded here – of all things! – of J.D. Salinger’s classic novel, “The Catcher in the Rye.”  It shows how young people lose their innocence, and potentially their sanity, when they come to grips with adult hypocrisy, or what Holden Caulfield, its hero, called its “phoniness.” I think the book had such enormous resonance for two reasons,  First,  it raised the question of whether we could sustain the innocence of childhood long enough in the life of each child so that children could become optimistic adults, even as they had to confront, in their adolescence, the dirty secrets of the adult world. Second, it had resonance because, published in 1949, it was anticipatory, foreshadowing young people's loss of trust in the adult world some fifteen years later.  Some thirty years after its publication, Neil Postman argued in his own book that the idea of childhood innocence in the United States, had a hundred year run, from 1850 to 1950, suggesting, once again, that an artist’s antenna, in this case Salinger's, picks up signals from the future.

“The Catcher in the Rye,” is both the book’s title and Holden Caulfield’s fantasy of his life’s work. As he tells his younger sister Phoebe, “Anyway, I keep picturing all these little kids playing some game in this big field of rye and all. Thousands of little kids, and nobody’s around- nobody big, I mean – except me. And I’m standing on the edge of some crazy cliff. What I have to do, I have to catch everybody if they start to go over the cliff- I mean they’re running and they don’t look where they’re going I have to come out from somewhere and catch them. That’s all I do all day. I’d just be the catcher in the rye and all. I know it’s crazy, but that’s the only thing I’d really like to be.”

Perhaps the Newtown shooting and the NRA’s response both raise questions we all face. Who, if anyone, will do the work of “child-catching” in a post-industrial world, how should they do it and how do we help them? 

Friday, December 7, 2012

J.C. Penny as the Post-Modern Department Store.

The “street” is punishing J.C. Penny, the department store, for its poor performance over the last year. It reported a $123 million loss in the last quarter, same store sales fell by 26% in that same period, and the stock price is down by 50% for the year. This, despite the fact that the relatively new CEO, Ron Johnson, who built Apple’s retail juggernaut, is bent upon transforming the chain, by drawing on his experience at Apple.  Once focused on offering discounts and coupons to low-income shoppers, Johnson hopes to re-stage J.C. Penney, which he now calls JCP, as an upscale aggregator of boutiques, where there are  “stores within a store.” Brand name manufacturers like Levis, Izod and Liz Claiborne would have outposts in J.C. Penney outlets. 

In a toughly worded article, Andrew Sorkin of the New York Times takes Johnson to task for being grossly unrealistic. How else to explain the company’s poor performance? Apple’s retail stores, he argues, are appealing because the products on offer are unique. While the Apple store concept and layout are terrific, these retail outlets would fail without the iPads, iPhones and Macs. But what can J.C. Penney offer? Jeans? Sweaters? Where is the thrill in that?

Sorkin’s critique poses the question of what being “realistic” means in the world of business. After all, we honor entrepreneurs who have “vision.” But doesn’t vision mean seeing beyond what is presently available or experienced? Doesn’t this mean being imaginative and therefore “unrealistic.” Steve Jobs, once Ron Johnson’s boss, and one of the great modern business visionaries, argued that customer focus groups were useless. Customers could not express desires or wants for products that did not yet exist.

But if a vision is not realistic, in the plain meaning of the word, if it is the product of imagination, how do we evaluate it before seeing if it can be fully implemented? This is not simply a matter of curiosity. Venture capitalists make judgments about ideas that have yet to be substantiated all the time. One conception of a fruitful business vision is that it needs to be simple. Think of Sam Walton’s vision for Wal-Mart, “bring large stores to small towns,” or Invagar Kamprad’s simple concept for building Ikea, “sell styled but low-cost knock-down furniture.” Simplicity signals that the business leader has not hedged his bets with provisos and exceptions. The leader has made an uncompromising commitment. Johnson’s business vision, “we are a store of stores,” certainly meets this test.

Fruitful visions are also linked to a social context that the business leader has personally experienced, but then interprets. This link strengthens the business’ leader’s conviction in what may appear to be at first too simple an idea. Sam Walton identified with small town America’s friendliness and frugality, but he also saw how the post-world-war two-highway system would link small towns together in a shopping region. Invagar Kamprad connected his experience of growing up in a poor region of Sweden with the country’s status as an international symbol of grace and design. He then saw how he could profit from the open world economy that emerged after the destruction of World War Two.  As these two examples suggest, business visionaries gain conviction because they link their personal experience to the context that gave it shape. It is not just about them, but about the social world that surrounds them.

One question then is; what is the context that gives Johnson's business vision its social character? His prototype or model store in Plano, Texas provides some clues. Divided into boutiques, the store aisles are uncluttered and shoppers have clear lines of sight to the far ends of the store. The cash registers are gone replaced by sales clerks with smart phones.  As the store architect said in an interview, the design theme is "square" so that people experience orderly right angles everywhere. This fits with the store's new pricing policy as well. There will be no more discount coupons. Instead the store posts "fair and square" prices everyday.

One hypothesis is that the "meaning" of the store is "transparency." There is no distance between surface and depth. What you see is what you get, but as a result what you see is entirely up to you. The store is a blank slate and you can project onto it whatever fantasy or meaning your shopping experience stimulates. The shopper's conversation is with the boutiques and their brands, the store is a container. Of course Apple stores have just this quality as well, the shopper's focus is entirely on the product.  Moreover, Apple computers were famously sealed, the hardware disappeared, while the user focused entirely on the screen.

This conception is strengthened in light of Johnson’s decision to change the store's appellation from “JCPenney” to “JCP.” The former is the name of a founder, and prompts recollections of an almost a century of experience. JCP, (actually the stock ticker), is by contrast an abstraction. Separated from its roots -- imagine a foreign tourist encountering the new appellation for the first time, it signifies that it signifies nothing in particular. Instead, as the company’s new logo below also suggests, JCP is a boundary marker and you are invited to fill in the blank.


The new name, the new logo and the store design together suggest that Johnson is drawing on what we might call a "post-modern" sensibility. In this way of experiencing the world, reality is a blank slate, there is no script and it is up to us to invent who we are in conversation with one another.
This hypothesis gains some credence when considering the company’s selection of Ellen DeGeneres, a publicly gay celebrity, to be its spokesperson. In response, the “million-moms network,” founded by the American Family Association- -a Christian conservative group opposed to homosexuality--announced a boycott of the stores that met with little success.

I have no knowledge of the decision process that led to DeGeneres’ selection. But it seems reasonable to suppose that J.C. Penney’s executives understood the risk they were taking with this choice, but believed on balance that they could benefit from it. If this is right it suggests that that they wanted to communicate their post-modernity, in the sense that in a post-modern setting sexual preference and even gender are matters of choice.

I was drawn in this regard to a shopper’s complaint posted on a web site. “I used to do most of my shopping at J.C, Penney,” the shopper writes. “But since their new fair and square program started, I have not bought much of anything. It is getting kind of scary when I walk in there. The store is half-empty. (Cash) registers are disappearing. There are more employees in the store than customers.”  If I may speculate for a moment, one reason the disappearing registers are scary is that they once marked out a boundary between the shopper and the store. They created a space of privacy in which the individual shopper, discount coupons in hand, could advance through the clutter to find a bargain. One feature of post-modern settings is just this loss of privacy, which as we know from the people who have been hurt by their own Facebook postings, can be risky. In this sense, the Christian conservative’s unsettled feelings in response to the world of modern media, particularly its sexualization, is understandable.  It is intrusive, preemptory and can undermine parental authority.  

So the question of whether or not Ron Johnson’s vision is realistic is linked partly to the question of whether a department store shaped by a post-modern sensibility is realistic. Interestingly, while only 11% of the company’s total retail space has been remodeled, the fully remodeled store returns $269 per square foot in sales, double the  $134 per square foot of the older store model.

This suggests that Johnson’s concept may in fact be right. But it does not means that his strategy will succeed. Reality is not simply a particular store, a design, or a prototype. Instead, it expresses itself everyday in the delays associated with any project, in the race between losing old customers and winning new ones, in the patience of investors as they watch a share price fall, and in people’s inertia.

Indeed, it seems likely that Johnson and his top team anticipated losing some of their old time customers as they transformed the stores. This may be one reason why Johnson has been sanguine about the decline in same store sales. But to ask Sorkin’s question again, where does “sanguine” stop and “wishful thinking” begin.

I don’t doubt that Johnson has what Abraham Zalenkik has called the “marketing imagination.” The Apple retail store network is a tour de force. But I don’t know if he or those around him also have the “logistical imagination,” a capacity to imagine the movement of materials, people, efforts and results through time. In the military this kind of imagination is critical. It ensures that troops never advance too far beyond their supply lines.

Ironically should Johnson fail in his transformation, we won’t know why. Was the concept grossly unrealistic, was the execution faulty, or did his new upscale competitors respond by offering shoppers a better experience or lower prices? This not knowing, really does mean that reality is to some degree, beyond our grasp. 

Wednesday, November 21, 2012

The Petraeus Scandal and the Stoic Warrior

The resignation of David Petraeus has the feel of both farce and tragedy. For some, he was a paragon, felled by something as trivial as a sexual impulse. For others, his affair, and the foolishness with which he carried it out, for example, using a Gmail drop-box to communicate with his paramour, showed the feet of clay behind the trumped up image of a disciplined and intelligent military leader.  I want to focus this post, not on the question of his character, for example, was he too self-promoting, but rather on the meaning of his affair within the wider culture.

Some people have wondered if the popular response to this behavior, the shock and the disappointment, reflects a stubborn puritanism in the culture, even in an age when pornography is so widely available and adultery is common. I want to propose a different thesis. I think Petraeus represented the idealized image of what Nancy Sherman has called the “Stoic warrior.” The Stoic warrior is the military person who gains control over his feelings, particularly fear and anger, even in the face of the enormous stresses and losses associated with war and battle.

In a famous incident during World War Two, General Patton, a U.S. military hero, slapped and kicked a soldier who had been admitted to an army hospital for shell shock. Moved by the many bandaged and wounded soldiers he saw, Patton could not tolerate the idea that this solider could escape the line of fire by pleading nervousness. The incident was scandalous because witnesses saw Patton lose control in so egregious a manner. As Abraham Zaleznik writes, “At the height of this brief but violent encounter, Patton appeared to have been shaken by his own conduct. He began to sob, wheeled around and told Colonel Currier, ‘I can’t help it. It makes me break down to think of a yellow bastard being babied.’” The solider, it turned out, had just seen his buddy gravely wounded.

Encountering such a moment frightens people because it highlights how, when a leader loses control over this feelings, power can lead to abuse. History is of course filled with what Freud called “primal fathers” whose rage, paranoia and narcissism destroyed many lives. One thinks for example of Stalin, Mao, Idi Amin and Charles Taylor. And surely, most every child experiences moments when parents are frightening, and the gap between “big” and “small" feels so fateful and final. The stoic warrior is an ideal because it creates the hope that we can entrust leaders with the power they need to protect us, without them turning against us. Petraeus of course was not violent, but his foolishness suggests that he gave way to feelings of lust, so much so, that he became careless. Indeed, one signal measure of an army’s discipline is the degree to which its commanders ensure that the troops do not give way to lust for example, by raping vanquished women.

One question is how do we create stoic warriors, not only in the military but also in civilian life. After all, in every setting we face the risk that power will be abused. One is reminded here for example, of how the Tour de France bicycle champion, Lance Armstrong, abused his position as the seven-time winner to punish co-conspirators who revealed, or threatened to reveal the fact that he and his team members had used drugs to enhance their racing performance. He was enormously competitive, as all warriors must be, but he was also brutal. We have of course codes of ethics, stoicism was just a code, and we expect our leaders to be disciplined in their work, most importantly to bear the pain associated with long term achievement on our behalf. Petraeus had just this image of a man of great discipline, a capacity for work, and integrity.

But I want to suggest that our image of the Stoic warrior is linked as well to an idealized image of the parental couple. It is a common cultural trope that men learn to be responsible when they have children. They relinquish some degree of self-aggrandizement, and the freedom of adolescence, by learning to protect their children and make sacrifices on their behalf.

A Washington Post article conveys a revealing image of the Petraeus couple in this regard. ( The reporter describes how Petraeus, and his wife Holly, “projected unity and love “as they presided “over their daughter’s wedding in Berryville, Va., at the stunning Rosemont Manor,” one month before the scandal. “Gen. Jack Keane, a longtime mentor who attended the nuptials noted that, ‘When dinner was over, Holly and Dave were both beaming throughout their evening.. They made their own way around the room saying hello to their friends and relatives.’ The reporter goes on to note that, “To many army couples Petraeus and his wife represented a role-model marriage.” Holly, herself the daughter of a four star general, had endured long separations from her husband when he was oversees and spent much of her work-life lobbying on behalf of veterans. “As the assistant director for the Obama administration's Consumer Financial Protection Bureau, she monitors and investigates consumer complaints from U.S. service members.” It is also a common cultural trope that the family is a civilizing institution.

One hypothesis is that the presidential election was partly about whether and how we can and/or should sustain this idealized image of the parental couple. As David Brooks, the conservative columnist for the New York Times wrote, after the election, “At some point over the past generation, people around the world entered what you might call the age of possibility. They became intolerant of any arrangement that might close off their personal options. The transformation has been liberating, and it’s leading to some pretty astounding changes. For example, for centuries, most human societies forcefully guided people into two-parent families. Today that sort of family is increasingly seen as just one option among many. The number of Americans who are living alone has shot up from 9 percent in 1950 to 28 percent today. In 1990, 65 percent of Americans said that children are very important to a successful marriage. Now, only 41 percent of Americans say they believe that. There are now more American houses with dogs than with children.” (

Perhaps part of Obama’s appeal, and why the Republicans failed in their effort to characterize him as a radical, is that he appears so temperate and controlled, even if sometimes dull and disengaged. Most people would find it inconceivable that he would engage in extra-marital sex, as did his more exciting predecessor, Bill Clinton. It is also likely that Brooks wrote his column in response to the discourse about the coalition that elected Obama. It did not include, “white males,” one cultural repository, at least for some people, for the image of the good patriarch. 

This may be one reason that the Petraeus scandal, occurring so close to the election, had special resonance. It occurred on the heels of a cultural struggle, in which the stakes are high and there is no clear path forward. If Petraeus was as talented as some claim, then we faced the farce of losing a great leader to a sexual peccadillo. But if he also represented the hope associated with the ideal parental couple, our loss, while largely symbolic, hurts us more.  

Wednesday, November 7, 2012

The New York City Marathon and Mayor Bloomberg’s decision.

In the aftermath of hurricane Sandy, which devastated communities along the coast of the Atlantic Ocean, the Mayor of New York City, Michael Bloomberg faced an important decision. The New York City Marathon, which the city had sponsored for 40 years, was scheduled for the Sunday following the hurricane. The city expected forty thousand runners from all over the world. Yet this was only six days after the hurricane had devastated parts of lower Manhattan, Staten Island, Queens and Brooklyn, all boroughs of the city. As Sunday approached, many families still lived in unheated and darkened homes and apartments. Yet to mount the marathon the city would have to provide electric generators to heat marathon tents, provide runners with emergency medical care, food and water, deploy police to oversee the marathon and close off streets in neighborhoods that suffered flood damage. Over 400,000 people were still without power two days before the marathon was to start.

Looked at pragmatically there were good enough reasons to hold the marathon. Many runners made substantial sacrifices, measured in time and money, to participate in the marathon, and they would be deeply disappointed. In addition, charities that sponsored runners would not get their expected contributions, and the city would lose about $340 million in marathon related spending, a significant sum, though trivial compared to the damage the hurricane wrought. Responding to citizens who felt the marathon would detract from the work of recovery, the Mayor assured them that the marathon “does use some resources, but it doesn't use resources that can really make a difference in recovery...There will be no diversion of resources." He added that, "If I thought it took any resources away from that, we wouldn't do that. We haven plenty of police officers who work in areas that aren't affected."

Perhaps sensing that pragmatism was not enough, Bloomberg also referenced a decision that the prior Mayor, Rudy Guiliani, took some two months after 9/11, to in fact hold the marathon. “I think Rudy had it right. You have to keep going and doing things, and you can grieve, cry, and laugh all at the same time. That's what human beings are good at." He added he had talked to Giuliani that morning, and Giuliani advised him to move forward: "New York has to show that we are here, and we are going to recover, and while we help people, we can still help companies that need business, still generate a tax base, and give people something to be cheery about in what's been a very dismal week for a lot of people."

The public reacted angrily, with people calling the decision selfish and unfeeling, while the Borough president of Staten Island, which had suffered great damage, called the decision “asinine.” A few hours later Bloomberg canceled the marathon.

One interesting question is, if Bloomberg was in fact unfeeling, what had he failed to feel? I don’t think it's sensible to say that he did not understand the public’s suffering. Rather, he failed to understand something more subtle, namely how the Marathon, if held, would lead people to feel that their suffering had been trivialized.

Bloomberg’s reference to 9/11 is telling. One can imagine holding a marathon after a terrorist attack --maybe even a week after -- if the event is experienced as a message to the terrorists and others that the city may be “bowed but not broken.” Under these circumstances the marathon becomes part of a narrative, which gives the disaster, in this case the attack, retrospective meaning. The narrative’s punch line is “we cannot be defeated” or “we represent life.” This message is embedded in a larger story about how people, when united, can defeat their enemies. Because an enemy launched the attack, people can feel that “an attack on one of us is an attack on all of us.”

The link between meaning-making and trauma is well established, and in fact is the basis for “logotherapy,” a form of psychotherapy developed by Victor Frankl, a Viennese psychiatrist who was a concentration camp prisoner during World War Two. Logotherapy’s presumption is that we can bear suffering, and even grow psychologically from it, if we can infuse it with meaning. One reason that a personal trauma -- a rape, a deadly disease -- is traumatic, is because it is random. The trauma not only attacks our physical being but our belief that the world is orderly and that our life has some purpose. People who cope with trauma by discovering a meaning or purpose in it, for example, to live life fully, to help others who suffered, or to bear witness, are said to be resilient. While logotherapy has been called “the third Viennese psychotherapy,” to contrast it with Freud’s and Adler’s conceptions,  psychoanalysis can be thought of, in part, as a therapy for making meaning. The patient learns to tell the story of their personal suffering, where it came from and why, and in this way gains some psychological distance from it. 

People once saw meaning in natural disasters. Recall the tale of Jonah and whale. To avoid God’s injunction that he preach to the people of Nineveh, he escapes on a ship, which is soon lashed by a storm. Jonah knows that the storm is a message from God, and so, to calm the waters and save the people on the ship, he offers to be thrown overboard. But to those who accept a scientific worldview, the message of a natural disaster is that there is no message. While the natural world is our home it is also wholly indifferent to us. A comet could destroy most life on earth in an instant. That is why for example, Pat Robertson, the evangelist, insisted that hurricane Katrina, which resulted in New Orleans’ catastrophic flooding, was God’s message that abortion was a sin. This was the only way to preserve his conception that the natural world is orderly and meaningful. It is a measure of meaning’s salience that some people are willing to acknowledge that they are guilty and deserve to be punished, in order to give a disaster meaning. In this sense, the disaster strengthens belief. This is one reason why Orthodox Judaism is thriving in the aftermath of the Holocaust.

To be sure, in the longer run, many people, particularly those who were not directly affected, will draw out some meaning from this storm. To many, Sandy is even now a “message” that global warming imperils us, and that we need to take steps now, to save generations to come. But presently, people experience the storm and its impact as arbitrary. Indeed one feeling people have when faced with arbitrary outcomes, is the feeling that they have been treated “unfairly.” This feeling is a protest against randomness, but without denying it, as a religious person might. This also means that people are very sensitized to being treated unfairly in the disaster’s aftermath. This may be one reason that people in New York City, believed, despite the Mayor’s protestations, that the marathon would unfairly divert resources from the work of recovery to the plebian business of mounting a marathon.

One question is whether or not it is in the character of a pragmatist to be insensitive to these nuances of feeling and experience. I am inclined to answer, “at least sometimes.” Bloomberg is a very popular mayor, so much so that he persuaded New York City residents to change the city charter so that he could run for a third term! People appreciate deeply his focus on solving problem, using data in decision making, and planning for the long run. His administration was a respite from the polarizing politics of his predecessor, Rudy Guiliani, and from the racial politics of the mayor, David Dinkins, who preceded Guiliani. Pragmatists are practical people, who to their great credit and to our great benefit, are oriented to reality. That is why they are so good at solving problems. But their conception of reality can be too one dimensional – linked too tightly to the interplay between means and ends. They can’t see the reality beneath the surface.

This may account for Bloomberg’s clumsy rationale for mounting the marathon; “You have to keep going and doing things, and you can grieve, cry, and laugh all at the same time. That's what human beings are good at." The term “human beings” is an abstraction. Why not say “people” instead? One hypothesis is that his word-choice is a measure of his retreat from feeling, perhaps because as a pragmatist he cannot cope with its complexity. We say children are innocent because they do not recognize pain's necessity. We say that adults are naïve when they fail to understand feeling’s nuances, particularly its mixture of pleasure and pain. Perhaps it is not that Bloomberg can be unfeeling, but that he can appear naive. Perhaps this is one price we pay when we follow and reward pragmatists. 

Thursday, October 18, 2012

The Euro Crisis and Feelings of Solidarity

The financial crisis in Europe raises an important question about the emotional basis for solidarity between groups. Over the past six months, as bond-holders downgraded Greek government debt, there was the danger that Greece would default, leave the Eurozone, and reintroduce a devalued drachma as the unit of its currency. Anticipating such a default, the depositors who held Euros in Greek banks worried that they would be forced to take drachmas instead of Euros. The result: A run on the banks and widespread business bankruptcies. In short, a financial Armageddon.

It appears that for the moment this threat has passed, though political paralysis in Greece could upend any agreements. As the New York Times Reports, “The visit last week to Greece by Chancellor Angela Merkel of Germany was an important moment, a conclusion to the long internal German debate about whether Greece should “Grexit,” or leave the euro. Her visit, and accompanying statements, made it clear that Germany was committed to Greek membership. Financial experts and officials say that implies that Berlin will also allow Athens more time, as it has asked (supported by the International Monetary Fund), to meet the terms of its bailout as its economy continues to shrink in a deep recession.”

I think this story is as much a morality play, with all the emotions such stories stimulate, as it is a tale of monetary maneuvers. The main characters of the play are Greek profligacy and chicanery, and German harshness and brutality. Germany’s seeming brutishness is why some Greeks feel self-righteous in opposing all demands for sacrifice and austerity. Greece’s seeming profligacy is why the German electorate is reluctant to help Greece by supporting the purchase of Greek government debt. It is also why Germany, and other Eurozone members, insists that Greece restructure its economy as a precondition for receiving aid.

There is little doubt that Greece’s leaders need a restructuring program and that it will prove painful. As the following chart shows, Greek government debt as a percentage of the country’s Gross National Product (GNP) has been an outlier, even before the financial crisis. Moreover, Greece’s labor productivity near the peak of the financial bubble, in 2006, was considerably lower than in other European countries 

In addition, as the chart below shows, Greece’s employment ratio, the ratio of the number of employees to the total population, was significantly lower than some of its peers. This was at the peak of the financial bubble and before the financial crisis.  


These three charts suggest that Greece’s public sector was indeed too large relative to the economy’s productivity, and its population was not as hardworking. The question is why?

One hypothesis, offered by a conservative Greek newspaper, is that after the military was removed from power in 1974, subsequent governments sought to integrate the “left leaning portions of the populations by spending on pensions, public sector jobs and social benefits."( As one New York Times reporter writes, “The three governments that have run Greece in the past three years have been loath to fire any of the nation’s 700,000 public workers, an influential voting bloc. And now, with unemployment at 25 percent, it is considered anathema to accede to the troika’s demands to fire at least 15,000 government employees. Although those jobless would get unemployment benefits for about a year, they would face almost impossible odds against being rehired — a situation that politicians fear would lead to further unrest.” ( But as analysts have also pointed out, tax-evasion is a Greek national sport, benefiting the wealthy far more than average taxpayer. “The Greek government in 2009 collected revenues that were only 36.9 percent of GDP, far below the average of 43.9 percent for members of the European Union.” ( Deficits after all are the difference between revenues and expenses.

There is also the oft told and true story that Greece lied in its application to join the Eurozone, by hiding some of its government debt through the use of credit derivatives and swaps. But, runs a counter-narrative, other countries have violated basic EU rules on debts and deficits, including Germany and France. Moreover, this counter-narrative continues, the Eurozone countries could have readily detected Greece’s cheating, but chose instead to accept Greece for moral and political reasons, in particular to ensure that a military junta would never again rule Greece. (    

People also argue that Greece benefited “unfairly” when it joined the Eurozone since banks, businesses and governments could borrow money at rates that were too low relative to the overall performance of the Greek economy. Cheap capital fueled a bubble, which in turn set the stage for the Greek economy’s downward spiral. But, goes the counter-narrative, had there been no Eurozone, the German deutschmark would have been higher and its exports lower than turned out to be the case. The Euro, as the common currency, stimulated German exports and the German banks invested the resulting surplus in…. Greek debt!

These dueling narratives are about accountability. But they also highlight the difficulty of parsing accountability in a system with so much interdependence. This ambiguity has psychological effects. One common response is to reduce ambiguity by thinking in extremes. The Greeks are not simply hamstrung by a partially developed economy, too dependent on shipping and tourism. Rather, they are lazy. The Germans are not simply asking Greek citizens to make appropriate sacrifices. Rather, they are Nazis who are once again “invading” Greece and punishing its citizens.

Consider the opposite case. People the world over are generous toward victims of earthquakes. It is hard to blame victims for a natural disaster, though their governments might be blamed for failing to enforce building codes. People feel solidarity with such victims based on their shared human vulnerabilities in the face of disaster. But when questions of accountability arise, people may suppress feelings of solidarity with those who are suffering, by thinking in extremes and stereotypes. This is why the conflict between Germany and Greece has been so difficult to stage with rational arguments alone. For example, how much austerity is sensible before Greece digs itself in a hole, unable to pay off its debt because incomes are so low. 

One question this suggests is how and under what conditions might people have feelings of solidarity that are strong enough to stave off stereotyping.  This question goes to the heart of the emotional meaning of the European Union. Many economists looked askance at the monetary union, arguing presciently that with out a fiscal union, where taxing and spending are centrally controlled, the common currency would create trouble rather than opportunity. This is indeed where we are now. Germany needs to support Greek debt but its citizens have no vote on how Greece taxes its citizens and spend its money. Greece cannot devalue its currency, the drachma no longer exists, in order to stimulate exports and increase employment.

One hypothesis is that monetary union represented a technocratic achievement, the result of elite planning and forethought, without resting on an emotional conviction about why the idea of a United Europe was important to Europeans. What was the meaning of a European identity?  Indeed just as European elites were invoking integration, we have seen movements of local “devolution,” -- the assertion of regional identities --for example, Catalonia in Spain and Scotland in Great Britain. Indeed, one theory of economic development holds that in a global economy the City-state, rather than the nation-state becomes humanity’s economic engine. Economic elites already live globally, owning homes and apartments in several world cities, such as London, Paris, Tokyo, Moscow and New York.  

Perhaps one way of explaining the gap between technocratic plans and felt identity is to note that the emotional meaning of Europe has not been simply an economic one. After the war the idea of a United Europe was a bulwark against Communism and the Soviet Union, and was also a way of ensuring that Germany would never again launch a war. From 1960 to 1990 it represented Europe’s recovery from the war. and its hope to achieve United States levels of productivity and scale. Europe would at long last become modern. Moreover, it would be the equal of the United States, while more effective in providing for the health and welfare of its citizens. It represented the alternative between socialism and capitalism.  After the fall of the Soviet Union, Europe meant pulling countries with totalitarian pasts into a common market, thus assuring that they would remain democracies. But what is it now? Perhaps the idea of the monetary union was too “economistic.” Elites had not done the hard work of linking the monetary union to issues of identity. Absent this work, a monetary union cannot draw on feelings of solidarity when people are called upon to make sacrifices.

Behavioral economics has changed the theory of finance by linking psychology to how people make financial decisions. Perhaps we need a methodology for linking psychoanalysis to political economy. In the face of conflicting interests, and the tension between immediate needs and longer-term outcomes, we should expect intergroup dynamics to play a critical role. The challenges elites face are not simply political. Instead, political dynamics are based not simply on interests, but on the emotions that bring people together and drive them apart.