How the Economy Hit Bottom—and What Comes Next

Mark Blyth, Austerity: The History of a Dangerous Idea
and John Authers, Europe's Financial Crisis: A Short Guide to How the Euro Fell Into Crisis and the Consequences for the World

The recently announced EU bailout of the Republic of Cyprus had immediate benefits, but not for ordinary Cypriots. The mainly German monetary transfusion caused bounces in major world stock markets, while bond dealers stopped their massive Cypriot money exodus. Banks that sank depositor money into crazily risky Greek investments will remain afloat, but the state must introduce “capital controls” so common citizens can’t access their own money.

This is a microcosm of the entire world economy since the banking crisis of 2007-2008. And it serves as an important cautionary tale about how we might work going forward, because many of the controls the European Central Bank imposed in Cyprus, Greece, and Spain perfectly mirror controls already implemented in Britain, and which have been proposed in America. And if we don’t understand the current economy, these controls look surprisingly appealing.

We cannot understand current economics if our horizons stop at national borders. Financial journalist John Authers titles his latest book Europe’s Financial Crisis, yet he leaves Europe for entire chapters, because the influences jeopardizing the Eurozone have causes, and effects, in America, China, Brazil, and elsewhere. Europe’s hybrid economy, rife with compromise, couldn’t withstand transnational forces which had no known precedent.

But we also mustn’t mistake how the crisis occurred. Political economist Mark Blyth first notes that this financial crunch, like many others, began when banks overleveraged themselves, then let the state backstop their debt. In other words, ours is essentially a private-sector collapse. Second, Blyth explicates the history of the idea that cutting the state opens the economy—and what real consequences financial austerity has had over the ages.

No one economic explanation suffices. The common parables of capitalist decay and moral failure don't explain how different firms and nations took different hits. No, Blyth and Authers see a single effect with many causes. This includes American investment banks blinded by fallacies of composition, and European economies shackled with one currency but seventeen fiscal policies. Blyth calls this "too big to fail" versus "too big to bail."

The Euro meant to bring Europe into a single integrated economy, but didn’t address underlying gaps. Seventeen nations shared a currency, but did not tie their fortunes together. Thus the Eurozone has one monetary policy, but seventeen fiscal policies, meaning member states had no autonomous recourse when financial markets did anything outside the accepted model.

When the European Central Bank, governed by fiscally conservative Germans, saw Greece, Portugal, and Ireland in such dire straits, it demanded a single fix, even though different economies had different problems. But the ECB's mandatory austerity didn't work, so it demanded even more austerity. Not surprisingly, this made a bad situation even worse. What economists initially termed a "haircut" turned into a scalping.

The desire to slash governments goes clear back to the late Seventeenth Century, with the rise of early capitalism. But as Blyth notes, economic circumstances differed then. England and America had only salutary competition, and states were led by self-serving monarchs. When competition became more fierce, firms needed governments to take a coordinating hand. Laissez faire only works in limited circumstances.

Only in the Twentieth Century have states become big enough to cut. But when nations do so, results have been disputable. Though capitalist purists claim small states encourage trade, look at today’s Eurozone: massive youth unemployment, skyrocketing debt, anarchic markets, and widespread suffering. Cutting the state hurts most those who can absorb hardship the least.

The problems were exacerbated by transnational supply lines and Internet banking. The global financiers who stuck money in Euro-American markets while the sun shone moved their money posthaste at the first sign of weakness. State-based financial policy proved unprepared for such foundational surprises, and conventional remedies crumpled. This was worsened by the fact that Eurozone nations can't print their own money to control supplies.

These books don’t make easy reading. Though Blyth and Authers translate complex economic principles into plain English, they use a lot of ideas, which readers must keep in mind indefinitely. These authors do their best to remain accessible, and inject them with moments of unexpected humor, but readers should prepare to invest a healthy chunk of time into the reading process.

But for those willing to make such an investment, they makes a complex case regarding how we reached this impasse, and where we go from here. We have to know the economy as it is, not as our ideologies make it. Only then can we solve the economic bleed that puts us all at risk.

See also: High Noon For the Economic Assassins

Methinks the Limey Doth Attempt Too Much

Robert Wilson, Capital Punishment

When beautiful, evasive Alyshia D’Cruz vanishes from a crowded Islington street, her Indian industrialist father hires Charles Boxer, London’s best kidnap consultant. But these kidnappers don’t demand ransom, or anything else. As Boxer and the D’Cruz family watch, they seemingly just torture Alyshia for fun. Boxer desperately calls in cards with the Met, MI5, and several crime syndicates, before they break a young woman’s already precarious sanity.

British novelist Robert Wilson’s eleventh novel attempts to kick-start a new series, and starts off quite well, with an edge of psychological horror based on casual sadism. But around the halfway mark, he veers hard left, dumping everything into the stew: the Pakistani ISI, London chavs with excessive self-regard, a Muslim versus Hindu turf war in Mumbai, heroin, class war, and the kitchen sink. A taut thriller metamorphoses into a chaotic Guy Ritchie knockoff.

Charles Boxer makes a good antihero. Raised by a seemingly bipolar single mum, he joined the Army young, where his misplaced aggression became an asset. Now he saves other people’s children, and apparently sidelines as a contract enforcer. But he hardly knows his own daughter, and catches himself repeating his father’s mistakes. He sees his own death spiral, but wonders if he has the strength to pull himself out in time.

But instead of entrusting Boxer with a single mystery, Wilson has Alyshia re-kidnapped, first by two layabout Eastenders who want to get rich quick, then by an ISI general whose zeal has morphed into megalomania. Police specialists, intelligence agents, the Mayor of London, and everyone but the Queen’s Horse Guards get involved in the investigation, which turns out to involve vengeance, electric cars, and dirty bombs.

This is all a shame, because for the first 200 pages, Wilson really had a winner. I wanted to know what dark secrets the kidnappers were trying to torture out of poor Alyshia, and what sordid past Frank D’Cruz wanted to conceal so badly that he would consider letting his daughter die. Wilson tossed us enough pieces that I wanted to assemble the whole jigsaw. I thought: this is really good. Everyone should read this taut, smart thriller.

Wilson admits that absent fathers are a recurrent theme in his writing. Charles Boxer’s father vanished when he was a kid, and now Charles is trying to avoid vanishing from his daughter’s life. But this theme has its obverse: Alyshia D’Cruz is fleeing her father, for reasons that Boxer teases out only with great difficulty. And Boxer’s daughter, Amy, won’t let her father get close after years of absence; she resents him so much, she’d rather punish herself than let him in.

These tensions drive much of the plot. How do you kidnap and adult who doesn’t want to be found? How do you psychologically punish somebody who seemingly has no conscience? As people do in extreme situations, these characters reveal their true colors, the inner identities they’ve tried to hide even from themselves. Not surprisingly, what they uncover often is not pretty. Heroes and villains trade places; people kill strangers to keep their families together.

Then Wilson turned on the cast of thousands, turning a cerebral drama into a London farce. Not that I mind London farce; Snatch is a classic film. But the change in tone is so jarring that this feels like two books, awkwardly stitched together, like reverse Siamese twins. Maybe that second book would have been good, too, if I’d just known it was coming. But when this novel should have opened into something profound, Wilson chose to kick readers in the teeth.

It feels as though Wilson doesn’t trust himself. He creates smart psychological tension, but seems afraid that, without a broad physical confrontation, readers won’t stick with him. So, just as we reach what looks like a turning point, where smothered secrets will finally see the light of day, he swerves, giving us a gun battle, followed by moments of low comedy. He has us sitting on the edge of our seats, and then he has us throwing our hands up, screaming “No he didn’t!”

This book has many admirable qualities, and I suspect a stern editor could have turned it into a smart nail-biter—or that and a sequel, each with their own strengths. I’m not sorry I read it, and I’m piqued to see more of Wilson’s books. But Wilson just tries to do too much, and as a result spreads his narrative thin. I like plenty about this book; I just don’t love it.

Tech Is Boring

So the other day, the fellas and I were sitting around a table, comparing smartphones. We took great pride in our storage mass and connectivity, and showed off how many pages our app selections occupied. (Okay, beer may have been involved.) But after several minutes, the truth came out: among our millions of apps, none of us ever used more than two or three.

When the iPhone hit the market in 2007, the buzz insisted that we had entered a new phase of human connectivity. Massive quantities of content could cross continents instantaneously; we could video chat, move texts longer than dictionaries, and have global conference calls at the flick of a screen. Yet how often do any of us do these? And how often do we upload YouTube videos of our cats?

Don’t get me wrong. I like having Pandora and Words With Friends on my Android. But the potential implications of advancing smartphone technology remain just that: potential. Although the major corporations roll out their latest releases with great fanfare, actual improvement has been, at best, incremental. As New Yorker blogger Matt Buchanan aptly puts it, Phones Are Boring.

But the problem runs much deeper than phones. My sci-fi buddies may pillory me for publicly stating such blatant heresy, but the promise of technology has fallen flat. Far from creating either the whiz-bang paradise or the bleak dystopia long envisioned by the genre classics, technology has proven mundane. And I think even the people who create the technology have noticed this disappointing trend.

Every so often, big tech companies—Apple, Samsung, Intel—conduct a blockbuster product launch, accompanied by the multimedia pageantry once reserved for car makers and movie studios. Each of them tries to recapture the excitement Steve Jobs notoriously created even for insignificant new advances. News media treat each product launch like a papal inauguration.

But Jobs was a consummate showman. He knew how to anticipate unmet needs, and pitch a product as though it plugged a hole in our lives. His launch extravaganzas for the iPod and iPad, which focused on utility and convenience while showering their figurehead monarch with nigh-divine praise, are textbook examples of smart, forward-thinking business.

We cannot say the same about the new machines rolling out since Jobs’ passing. When the big news surrounding the latest version of the Samsung Galaxy smartphone is that its screen runs 0.03 inches smaller than the prior model, I shrug and return to my beer. When the newest Kindle manages to abolish the QWERTY keyboard, I feel a strong urge to go grab a paper book.

I lay the blame, not on the individuals responsible for the new developments, but on the corporate mindset that has overtaken technology. In 1940, “inventor” was a job category on US Census forms; that field vanished in 1950. The process of creating new tech has fallen into the hands of corporate R&D departments which, with their bottom-line mentality, are notoriously risk-averse.

This results in mere refinements of existing technology. Smartphones merge wireless communications with imprinted circuits for a useful hybrid, but it isn’t really new. The Internet relies on ARPANet technology that has changed only in magnitude since it debuted in 1969. As “development” has edged out “invention” as the motivating factor in technology, the classic jet-age wonder has worn away.

Insofar as new tech fires human imagination, it comes from self-motivated outsiders, not corporate shills. Rollo Carpenter, whose Cleverbot program has come close to passing the Turing Test, has worked for various start-ups, but remains substantially a free agent. Philo Farnsworth, who invented the earliest television, had an adversarial relationship with corporations, which repeatedly plagiarized from an inventor they considered a back-country farmboy.

Saying this, I acknowledge that technology has reached a point where garage hobbyists can only do so much. Without access to industrial technology, they cannot imprint a circuit board, for instance. But if tech companies would really innovate, as Jobs and Gates once did, they might start by giving in-house inventors freer rein, letting them pursue private passions, and follow cow paths that pay off only after prior attempts have failed.

The persistent popularity of space opera and cyberpunk, the forms of science fiction least bound by near-term realism, bespeaks a continuing belief that technology can produce a sense of wonder and gape-jawed excitement. Deep down, many of us want our flying cars and neural-net implants. But the people who actually make technology have come to dream small. It’s up to outsiders to demand more.

Slippery Rhymes and Fleeting Poetic Truths

1001 Books To Read Before Your Kindle Battery Dies, Part Twelve
A.E. Stallings, Olives: Poems

The first trait new readers will discover when they crack her books is that A.E. Stallings rhymes. Though a handful of living poets like Dana Gioia and (to a lesser degree) Paul Muldoon use rhyme in their verse, the poetry establishment, readers and writers alike, substantially frown on direct end rhyme. Such aesthetic conservatism doesn’t sit well with the in-crowd these days.

But in reading, one gets the feeling Stallings doesn’t write for the in-crowd. Despite her use of conventional forms, especially sonnets, villanelles, and terza rima, her poetry is plainspoken, humble, and vernacular. Her blend of casual language and sophisticated form embodies what I think Wordsworth meant when he advocated a modern poetry in the language of the people.

Indeed, Stallings’ poems rely on such contradictions. She makes the timeless artifacts of her adopted homeland, Greece, vanish into the banal backdrop of a continuing memoir, while at the same time adding unexpected grandeur to ordinary events: making a phone call, a baby spitting up. Reading her verses, we feel the ground of our expectations shift violently under our feet.

In such an environment of unexpected paradox, her use of comprehensible rhyme gives us something firm to grasp. We follow her ideas’ volatile movement by the guideposts of her deceptively comforting language. This especially comes across when she talks about transcendent verities, as in this passage from her villanelle “Burned”:

You cannot unburn what is burned.
Although you scrape the ruined toast,
You can’t go back. It’s time you learned

The butter cannot be unchurned.
You can’t unmail the morning post,
You cannot unburn what is burned

Sometimes the rhyme is less obvious. Sometimes she’s oblique, rhyming “glass” with “vast,” a rhyme so fleeting that you miss it if you aren’t looking. Or in “Alice in the Looking Glass,” her rhymes are thematic rather than sonic: “pass” rhymes with “stay,” “bottom” with “top,” “here” with “there.” Only when you recognize the parallels do you spot the pseudo-rhyme.

We trained poets find it easy to mock readers who demand that poetry must rhyme, perhaps, because we think of words and verses as units of meaning. Because we write silently, expecting audiences to read silently, we lose sight of what I think rhyme’s layman advocates love: that language is comprised, not of the ideas we would convey, but at its most basic, of sound.

Stallings understands this. As a classicist rather than a trained poet, she handles the words of poets who wrote so that their work could be read aloud. Greek and Latin poetry was never read silently; poets were orators, and their verse was written for speech. We get a feeling for this when Stallings writes something that bridges the ages, like this from “Persephone to Psyche”:

Me and my man, we tried a spell,
A pharmacopoeia of charms,
And yet... When I am lonesome, well,
I rock the stillborns in my arms.

But Stallings does not merely recreate the splendors of the past. Poetry students have to be trained out of recreating their favorite highlights from Shakespeare or Browning, but Stallings accomplishes what students strive after. She shifts effortlessly between the linguistic panache of her poetic forebears, and her contemporary world. Consider this from “Sea Girls”:

“Not gulls, girls.” You frown, and you insist—
Between two languages, you work at words.
(R’s and L’s, it’s hard to get them right.)
We watch the heavens’ flotsam: garbage-white
Above the island dump (just out of sight),
Dirty, common, greedy—only birds.
OK, I acquiesce, too tired to banter.

This story starts out with Stallings attempting to teach her son to pronounce circumflex consonants correctly. But as it progresses, the similarity of words in a child’s mouth unlocks the essential similarity of concepts, the ways in which seagulls somehow resemble vibrant young women. Language proves slippery, not because of ideas, but because of sound.

This conversational tone makes poetry, a notoriously opaque literature beloved most often by those who create it, accessible to those outside the academy. Stallings creates verses that speak in regular language, without sacrificing the complexity that makes the best verse feel so substantive. Her work rewards casual reading or intense scrutiny.

Hopefully, Stallings represents a vanguard, a “new” breed of poet who writes for the audience, not the tenure committee. But even if she proves a minor oasis in the poetic desert, she has positioned her work amid her generation. Whether she produces a new verse movement or not, she has claimed a place in her audience’s spirit.

What Happens In Fantasyland, Part 2

Vicki Pettersson, The Lost (Celestial Blues, Book 2)

This review is a follow-up to What Happens In Fantasyland Stays In Fantasyland.

Avenging angel Griffin “Grif” Shaw gets tapped to escort a suffering addict to his eternal rest. But Grif’s human honey, journalist Katherine “Kit” Craig, can’t let a lonely teen die in squalor, and tries to intervene. Deep inside a Las Vegas drug den, Kit discovers a new drug that causes a long, stuporous high, but rots the flesh from tweakers’ bones. To Grif’s horror, the drug does something worse: it provides a gateway for demons to take human flesh.

Unlike the first book in Pettersson’s “Celestial Blues” series, The Taken, in which supernatural gumshoe solves a human crime, this second volume more carefully integrates the transcendent and the earthly. The human characters see Sin City boiling into a gang war between Russians and Cubans. They don’t realize that their anger, venality, and selfish ambition open doors for powerful creatures that feed off sins. Be careful what you call; you may not like who answers.

Following the first book, Kit Craig and Grif Shaw have fallen into a comfortable relationship of sex, breaking hot stories, and taking the dead onto the next life. But tension exists. Grif, who died in 1960 and returned in the prior book (the explanation is not brief), has spent over fifty years amid transcendent beings who see the whole of time. Kit remains an idealist at twenty-nine years of age. This gulf colors their relationship, pushing their buttons at awkward moments.

Grif remains fixated on solving the mystery of his first life: who killed him and his wife one late Vegas night? This perfectly reasonable quest interferes with his relationship with Kit. Meanwhile, Kit so desires to do the right thing that she doesn’t think about what the right thing is in the long haul. Kit’s aggressive idealism appears flighty to Grif, while Grif’s desire to right erstwhile wrongs looks to Kit like he cannot commit to the present. Both want to do right, but talk past one another.

Kit and Grif’s investigation comes to include the police (Kit has a remarkable symbiotic relationship with an affable cop), but also two violent gangs who shadow the two heroes. In trying to do the right thing, in other words, the heroes help hasten a violent confrontation, a conflagration that threatens to bring Vegas down. Pettersson presents Sin City as gangrene on the face of the earth, which Kit and Grif must excise if they would save the patient.

Pettersson’s writing propels the characters through a strange, yet entirely natural, plot. As a dead soul made flesh from 1960, Grif is a man out of his time, a refugee from postwar noir classics. Kit, a “rockabilly” devotee, tries to recreate herself as a woman of Grif’s time, yet remains part of the Twenty-First century. Where most urban fantasies awkwardly try to tell Dashiell Hammett stories in the present without saying so, Pettersson makes her anachronisms explicit.

This extends to Pettersson’s language. Like many urban fantasy novelists, Pettersson cherry-picks plot stylings from romance writing, with its florid linguistic ornamentation. (Her sex scenes are much more judiciously written than Delilah Devlin's.) But her mystery elements reflect terse, laconic mid-century prose. At times, this shift really draws attention to itself: does anybody. Really. Talk. Like. This? But mostly, Pettersson manages the split well.

Fantasy generally flourishes by its reliance on larger-than-life events in a world transcending the ordinary. Urban fantasy has enjoyed faddish popularity by folding mythic content into real-world settings. But too many urban fantasists produce small, quotidian stories. Vicki Pettersson straddles the line: she gives us realistic, plausible crimes, but parallel stories of transcendent might. Not everyone will like this dualism, but it at least bespeaks willingness to take risks.

This book exceeds the first one, in that it’s more integrated. Maybe Pettersson needed to write the first book to set the stage, because many of the threads that bind this immensely complex story together come from what she wrote before. This means it’s hard to come into the story cold, even though this second novel is clearly stronger, more confident, and more thoroughly constructed than the first. But if you’ve read the first, this one makes a good payoff.

Urban fantasy often suffers from unimaginative, wheezy storytelling. Pettersson provides the noir paradigms readers have come to expect, the romantic encounters readers enjoy, and the hocus pocus that makes us dream. But she also steps outside her genre’s comfy confines and takes a shot in the dark. This whole genre is imperfect, but Petterson flourishes by taking smart chances.