A Visitation of Spirits

I found out about Randall Kenan through a party that I went to - surprise, surprise, one can actually learn things at these places every once in a while. One of the people I was talking to told me she had written an article about him for the UNC literary magazine, that he taught at UNC and that people compared him to Faulkner. Naturally I was intrigued and had to check him. So I got a novel of his from the library - A Visitation of Spirits - and plowed through it (well, I wasn't that fast, mainly because I had too much university readings).

The first thing I have to point, quite unsurprising really, he ain't no Faulkner (but then who is). I guess every decent Southern writer will at some point in his life be compared to Faulkner and he is comparable in the sense that he also is describing a South that is slipping away into modernity (for better or worse). Yet, he is his own writer, quite different from Faulkner's abstract writing, he is more concrete, more precise, less ambiguous, his characters are less representative of the South in general. But, he is a good writer and I thoroughly enjoyed his book.

The novel deals with two characters mainly, one who grown up to become a priest in his small home-town and the first black principal of the local integrated high school, the other an overachieving student who has a hard time adjusting to his life, to growing up, to becoming an adult. So, forget about the Faulkner comparison, but if you want to read a North Carolinian author, writing about North Carolina, get one of his novels.

What I found particularly interesting about this author was the position some of his (black) characters displayed towards the white inhabitants of their small town. For someone like me who was to some extent shocked by the separation of black and white that still exists here (and that I had forgotten about since high school), a black point of view that condones self-segregation was very interesting.

Globalizing Capital

Barry Eichengreen's Globalizing Capital - A History of the International Monetary System was part of the readings for a class I have. For various reasons I never had the book when we were supposed to have to do the readings. So I borrowed and read it over my Thanksgiving break even when I wasn't sure whether the whole book or only parts of it had been assigned. Some people might wonder why now, but in my last college days, for reasons I cannot quite fathom yet, I have become increasingly interested in macroeconomic developments and the international economic arena in general.

Eichengreen in his book gives an overview of the history of the international monetary system (admittedly relatively unsurprising considering the subtitle of the book) from the 1870s onwards. He sketches the path to the gold standard, its predominance until 1914, the futile interwar attempts of reestablishing it and the ensuing instability, the Bretton Woods System, the following floating exchange rates, and finally attempts at monetary unification. Published in 1996, the one glaring omission of this book is EMU. Also, one of today's most pressing financial issues, the build-up of dollar reserves in developing countries, specifically China, is not included. But even if the inclusion of these more recent developments would have been appreciated, Eichengreen obviously cannot be faulted for them as he had finished writing his book before these points really arose. Furthermore, the book is highly interesting in any case.

I don't want to write a lengthy review of this book because of two reasons. Firstly, to give the author justice one would have to be very detailed in a critique of his book, as his argument is very detailed and exhaustive in regard to the amount of information provided. Secondly, I simply am not sure whether I am truly capable of criticizing an economic author like him yet. I started getting into economical issues late in my studies, a year ago really, and I cannot say that I have developed enough of a grasp as of yet to really have strong personal opinions on topics as abstract as this one.

Yet, having said that, it seems to me that Eichengreen's main argument is that there are two reasons why the gold standard could not be successfully implemented again after the First World War. The strict adherence to the gold standard, which was necessary to prevent speculative attacks on currencies, resulted in countries sacrificing growth and employment figures (through deflation) for stable exchange rates. This was possible mainly because the segments of society mainly hit by unemployment and this decrease in growth were politically irrelevant, they could not vote. With universal suffrage becoming a reality in most of Western Europe it became impossible for governments and central banks to pursue this kind of policy. Thus, another measure was used to keep exchange rates in check, capital controls. This made speculative attacks more difficult even if it never eradicated them permanently. Furthermore, these controls became less and less efficient and an ever increasing global flow of capital made the adherence of fixed exchange rates more and more difficult leading to the current system of most major currencies floating freely against one another.

If Eichengreen uses stylized facts in his book, I just super-stylized those. I thought I should at least try to offer a concise (hopefully) and short (definitely) summary of his book though. I really enjoyed reading it and I will almost assuredly try to find out more about this subject.

The White Man's Burden

William Easterly's The White Man's Burden – Why The West's Efforts to Aid the Rest Have Done So Much Ill and So Little Good in some regard is a response to Jeffrey Sachs' The End Of Poverty. I had to choose one of them for an in-class assignment, but I felt that in order to get the full picture I should read both.

As so often with judgement calls it is hard to decide who is right and who is wrong, even when Easterly so clearly and openly disagrees with Sachs and it seems inherently necessary to choose a side. Just as a reminder, Sachs claims that an increase in financial aid will allow countries to escape the poverty trap in which they currently are stuck (this is obviously a very simplified and condensed version of his argument). Easterly on the other hand is of the opinion that no general blueprint provides a solution for a disparate group of poor countries. Instead of so-called planners trying to solve all problems at once – something that according to Sachs would be necessary, as partial solutions would not suffice for countries to escape the aforementioned poverty trap – he wants more searchers, knowledgeable locals who offer creative (or simple) solutions for small and specific problems. These searchers would allow market principles, trial and error, to create development, instead of relying on inefficient international institutions and aid agencies or corrupt local governments.

Easterly strongly criticizes Sachs for his belief in broad national plans that provide the big push needed for poor countries to start developing. Easterly is of the opinion that this does not work, because of bad governance and inefficient aid agencies whose activities are not evaluated by anyone but themselves. What he does not take into account is that Sachs actually agrees with him here to some extent. Sachs' national plans require a stable government only limitedly corrupt in order to have any chance of success. While he himself does not point this out, it is thus clear that failed states or highly instable countries are incapable of taking part in his plan to end extreme poverty by 2025. Furthermore, Easterly does not refute the poverty trap, assuming that this trap exists for certain countries his method of market forces combined with aid would not be sufficient for truly sustainable growth.

Finally, I believe that Easterly and Sachs are not as incompatible as they seem to think. Easterly admits himself that the current levels of financial aid are low per capita even if not in absolute numbers. They accordingly agree on a required increase in aid. Sachs' approach could be used for a strictly limited number of countries, those inherently limited by their geographic and medical conditions, while Easterly's approach of independent evaluation and more customer-orientated aid could be used for the rest. This especially, as his approach would restrict national governments misuse of financial aid through the dispersal of money of a local project level.

Easterly's book, while a very worthy read, especially after Sachs' glowing optimism, has to be faulted in that it is clearly written by an economist. His arguments are good, his examples as well, his writing style is not. Basically, what he does in large parts of the book is recount examples of what worked or did not. These examples and statistics individually might be very interesting – and are to a large extent – assure that the book never develops any kind of flow. It does thus not offer a very fast or pleasant reading, even when it provides for a very interesting argument.

Lord Jim

I very much enjoyed reading Joseph Conrad's Heart of Darkness so when I saw Lord Jim lying around in some bookstore, I picked it up. Of course it took me about a year to actually read it, but I finally did. Again I really enjoyed it too. Conrad tells the story of a young man who fails miserably at the first test of strength in his life, and then spends his remaining years fleeing from civilization and into heroics in order to salvage what dignity he is left with.

While some of the imagery in regard to honor for example is very old-fashioned, and the portrayal of non-white people is simply distasteful, the general moral dilemma is a powerful one and Conrad does a very good job at detailing it.

Read it.

The End of Poverty

I had to write a book review for a class of this book. Here it is: Jeffrey D. Sachs - The End of Poverty. Economic Possibilities for Our Time.

Greasing the Wheels

I can only repeat that it is amazing how much they make you read in class here. Especially my PhD class, which apparently has even more readings than most classes on that level, is extreme in this regard. But I love it, it forces one to do a lot, to learn a lot and while legislative politics is a topic I never would have thought to ever read so much about, I find it challenging and rewarding.

The newest entry in my list of books then is Diana Evans' Greasing the Wheels - Using Pork Barrel Projects To Build Majority Coalitions in Congress. People in class yesterday ripped it apart for its empirical data (or lack thereof). Quite honestly, I do not know enough about quantitative political science to properly judge the analytical methods that Americans rely on so much - I find German political scientists to be a lot more theoretical and accordingly less empirical - but having said that I have to agree that the data Evans provides is not really convincing. Not only are her results only partially supportive of her theory though, some of the statistics seem pointless in light of her argument, and furthermore her main example is questionable - as it could be argued that the Transportation Acts themselves are pork barrel projects and not general interest legislation.

What Evans is arguing, is that pork barrel projects are used to buy together winning conditions for general interest policy. Thus if a leader (whether it be a committee or subcommittee chairman or the speaker or the president) has a pet project which he wants to pass, he buys off those representatives who 'sit on the fence' - meaning they are undecided whether to oppose or support a given piece of legislation. This works a lot better in the House than in Senate, mainly because Senators represent far bigger areas and thus are a lot more expensive to buy, as for any given project to have an impact in their states it needs to be a lot bigger and more expensive.

Her argument works best when she is analyzing NAFTA and the way Clinton greased its passage in the House. Buying two military planes for 1.4 billion in this district, protecting sugar and citrus in Florida in order to ensure some more ayes, according to various estimates between 30 and 77 votes on this bill were bought.

Evans claims that pork barrel projects undeservedly have such a bad image. They help pass general interest legislation at a relatively low price - while high in absolute numbers, as a percentage of the federal budget pork barrel projects represent no more than 1% of all government spending. In my opinion she is partly right about this too, the problem is that greasing the wheels easily gets out of hand. When representatives realize that votes are bought, they will wait to receive something for their vote even if they support the project and would have voted for it in any case. Thus, in a first vote, vote-buying can be accomplished relatively efficient in order to ensure a needed majority. Every vote after that though will make projects spiral out of control. Evans does a good job of showing this on the 1991 Tranportation Act as opposed to the earlier 1987 one.

One last restriction, it seems questionable how widely applicable this model is. The NAFTA example shows that votes can be bought and that it is successfully practiced at times, yet restraints on representatives including their beliefs and earlier policy-demands make it doubtful how regularly vote-buying actually occurs and whether votes really come as a cheap as a new highway bridge somewhere in Wyoming.