As if to underscore the point I’ve been making about orality, literacy, and visualcy this morning, David Brooks has a column this morning in which he makes the reasonable point that in the current economic situation we need to abandon the notion of the economy as a moral drama in favor of dealing with the problems at hand in an effective way:
Right now, the economic landscape looks like that movie of the swaying Tacoma Narrows Bridge you might have seen in a high school science class. It started swinging in small ways and then the oscillations built on one another until the whole thing was freakishly alive and the pavement looked like liquid.
A few years ago, the global economic culture began swaying. The government enabled people to buy homes they couldn’t afford. The Fed provided easy money. The Chinese sloshed in oceans of capital. The giddy upward sway produced a crushing ride down.
These oscillations are the real moral hazard. Individual responsibility doesn’t mean much in an economy like this one. We all know people who have been laid off through no fault of their own. The responsible have been punished along with the profligate.
It makes sense for the government to intervene to try to reduce the oscillation. It makes sense for government to try to restore some communal order. And the sad reality is that in these circumstances government has to spend money on precisely those sectors that have been swinging most wildly — housing, finance, etc. It has to help stabilize people who have been idiots.
But check out those commenting on Mr. Brooks’s column at memeorandum. Even the quickest glance at Brooks’s column and at these posts suggests that the bloggers simply don’t comprehend what he’s saying. They are functionally illiterate.
Just as telling several link to two videos, one from CNBC commentator Rick Santelli from the floor of the Mercantile Exchange and another from Virg Bernero, mayor of Lansing. These they get.
Just a few corrections to all except Nate Silver who apparently gets out more than the yahoos.
- Most Chicago commodities traders aren’t multimillionaires and a significant number are from working class families. My neighborhood is a preferred place for traders. I know these guys.
- Not even a bare majority of the people who took out subprime mortgages are poor people. That’s especially true in California, Arizona, and Nevada where the biggest problems are.
- Auto workers aren’t poor people. Depending on seniority they’re either in the fourth (second highest) or fifth (highest) income quintile.
If we’re going to engage in class warfare and decide what class people are in based on their incomes, it might be nice to have a vague idea of what people actually earned in income.
Brooks definitely had a good point, although I think he could have amplified it by pointing out how the sheer quantity and nature of the funds sloshing around more or less overrode everyone’s rational safeguards. The signals were all flashing “Rich! Rich! You’ll be a rich man!”, and what is something like mere reason and rationality against that?
IIRC, the Rick Santelli rant followed an explanation from an executive with Fannie/Freddie that the publicly-financed refinance program would hopefully only have a 40% failure rate. And that’s after limiting the program to people that are not abnormally under-water.
So, yeah, I’ll admit to thinking that I don’t want to help pay someone to stay in their $700,000 house, if I think the program won’t have greater public benefits.
Yeah, I’m probably missing the point too. It’s the Irish.
On the visualcy issue I’d point out that I make my living selling 500 page books to teen-agers. No pictures.
Michael, my claim isn’t that the printed word is disappearing any more than the spoken word disappeared in the 19th century. It is that the dominant, accepted communications modality for most people and the cognitive behaviors that accompany that communications modality is changing from literate to visual.