The End of Week Circulars for June 04, 2017

These Legs are for Collusion

She’s guaranteed herself a second interview with Putin.

But what will she wear to the rematch?

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Anti-Trump Proves Worthy of Comey’s Contempt

We interpreted Comey’s actions as FBI Director as most consistent with a strategy to build an obstruction of justice case against Trump by goading him into making a series of borderline statements that, collectively, made up obstruction.

We also believed the universe of anti-Trump forces were kept in the dark about Comey’s exact plans and that, by keeping anti-Trumpers in the dark, Comey was demonstrating contempt for anti-Trump.  Even Comey’s deputy was out of the loop given that his deputy testified publicly to Congress that he had not seen evidence of interference into the investigation by Trump’s administration.

As it turns out, anti-Trump forces are still deserving of his contempt.

The reporting on the Russia investigation is still anticipating that an impeachable offense will emerge from it.

What they don’t realize is that, by firing Comey after just four months, Trump has ruined Comey’s strategy.  He left the FBI Directorship too soon for him to accumulate enough private statements by Trump to construe them as anything more than “pressure” or “inappropriate”.

But anti-Trump has not realized Comey’s gambit is over.

Comey was the most dangerous actor against Trump because Comey was the only person in the anti-Trump nexus with an attention span greater than a moth.

With Comey out of the way, anti-Trump would be better off moving to some other strategy instead of clinging in desperation to a strategy that is non-operational in Comey’s absence.

That anti-Trump still hasn’t figured this out proves Comey’s judgment of them as easily manipulable stooges was right all.

The Paris Accord Warrants Impeachment

Obama’s impeachment.

The Paris accord was clearly a treaty; treaties are mandated by the Constitution to be put to the Senate for ratification.

Instead of doing his Constitutional duty by sending the Paris accord to the Senate for a vote, Obama tried to give it force of law without Senate approval.

This blatantly illegal action by Obama clearly warranted impeachment.  Fortunately for him the rest of the elite followed the “Comey rule” of law enforcement which mandates that Democrats are not allowed to be legally punished for breaking the law.

Paris is Burning, Paris will be Burning

Trump burned the Paris accords.

Before Trump sent them up in flames, Macron preemptively retaliated against Trump’s withdrawal with an aggressive handshake.

Macron should worry about Trump.  After two recent ISIS terrorist attacks in Britain it won’t be long before another mass-casualty strike is made against France.

When ISIS comes to shake Macron’s hand we’ll see how well he handles a real enemy on camera.  We expect not even the Western media will be able to spin his response to terrorism as a macho staredown won by Macron.

Vote Corbyn, Get Mandelson

I enjoy being proven right as much as any analyst.  Unlike most analysts, I have the fortune of being right more often than not.

Such as hereHereHere.  And here.

I am not as foresighted as Metternich.  But I am usually on the right track.

In Britain, Jeremy Corbyn threatens to put to the test my theory that Progressive Fabian Socialists are not Communists because the Fabians (and related groups across America and Europe) are anti-proletarian “Communists”.  Which defeats the whole point of a truly Communist dictatorship of the proletariat.

If I am correct, should Corbyn form a government, the first major act of the Labour party will be to sack him in favor of an anti-proletarian Blairite Labour leader who will sink a Brexit that was backed by the proles.  Corbyn has made noises in the past unfavorable to the European Union, and genuinely seems sympathetic to what remains of the British working class.  Unfortunately for him, the anti-proletarian wing of his party is strong enough to remove him just for daring to have these sentiments.

If Corbyn is not be reliable on Brexit, the likes of Mandelson and such will not take chances with him and be sure to install a Labour leader fully opposed to exit at the nearest opportunity.

But, Britain, please do not put this theory – Progressives are “anti-proletarian Communists”, hence, not Communists – to the test.

I have more than sufficient evidence for this case.  It does not need a Corbyn government as an extra data point to the existing historical record.

In this system there are three characteristic elements: 1) a series of brilliant thoughts, which however are nearly always spoiled to some extent because they are incompetently set forth likewise; 2) a narrow, philistine way of thinking sharply contrasting with that brilliant mind; 3) a hierarchically organised religious constitution, whose source is definitely Saint-Simonian, but divested of all mysticism and turned into something extremely sober, with a regular pope at the head, so that (Thomas) Huxley [4] could say of Comtism that it was Catholicism without Christianity.

Then there is another point I should like to correct, the note on p 513. [5] Marx never was Secretary General of the International but only Secretary for Germany and Russia. And none of the Comtists in London participated in the founding of the International. Professor E Beesly [6] deserves great credit for his defence of the International in the press at the time of the Commune against the vehement attacks of that day. Frederic Harrison [7] too publicly took up the cudgels for the Commune. But a few years later the Comtists cooled off considerably toward the labour movement. The workers had become too powerful and it was now a question of maintaining a proper balance between capitalists and workers (for both are producers according to Saint-Simon) and to that end of once more supporting the former. Ever since then the Comtists have wrapped themselves in complete silence as regards the labour question.

I will be more than happy to leave what the Fabian reaction would be in the aftermath of a Corbyn victory as a historical hypothetical.

The Disadvantages of Protective Labor Laws

Hamiltonian economics should, like all theories, be judged by its explanatory power.  We have begun to introduce our economics to the reader in Part I and Part II.  To prove their worth we tackle this old paradox in our terms:

Why are unemployment rates lower in Western economies with the easiest hire and fire laws?

Employees are resources.  Like other resources how they are put to work in business operations is determined by the Hamiltonian business cycle.

A review of Hamiltonian cycles:

All business cycles start with demand.

Cyclical booms are driven by booming demand, usually in a particular sector that is specialized to meet whatever type of demand is in vogue.

Demand in a sector spurs on what we call sector momentum.  As sector momentum builds, more and more resources are allocated to business operations designed to satisfy this demand.

Among these resources is labor.

Cyclical busts occur when booming demand falls below projections.  Businesses in previously booming sectors are left with over-allocated resources.  Reallocation of these resources occurs to factor in new market signals about demand.  During bust phases, labor that had been invested in satisfying demand during the boom is usually laid off.

In the West, laws that restrict how free businesses are to cut staff are ultimately self-defeating because they interfere with how well businesses can align labor resources with operations that meet demand during both boom and bust phases.

During upswings in customer demand, employers in nations such as France are deterred from hiring staff because they will not be able to easily release them (i.e., reallocate labor resources) during the inevitable downswing.

Nations that broadly support at-will employment have a relative competitive advantage. In these economies employers have more flexibility to adjust their employment levels to track changes in the business environment than nations with strict labor laws.

The greater flexibility offered by Capitalistic labor laws is advantageous because the changes in value signaled by the customer and environment are inherently unpredictable and constantly changing.  Resources, like employees, must change when value changes.  If labor resources, or any other resource, cannot easily be reallocated (or released), business performance is consistently performs at sub-optimal rates during both the bust and the boom phases because businesses cannot react to their environmental conditions.

Paradoxically, flexible labor laws result in lower unemployment levels because businesses working under those conditions have more efficient processes thanks to being able to more efficiently allocate labor resources as decision makers see are warranted by customer demand.

Robber Baron Capitalism in Four Lessons – Part II: Hamilton’s Theory of the Business Cycle

Our series into Capitalism continues. In this, our purpose is in no small degree to wean you Libertarians of an Austrian bent away from Austrian economics and toward Alexander Hamilton’s superior vision of economics, Robber Baron Capitalism.

We now take aim at that pillar of Austrian economics, the Austrian theory of the business cycle, knock it down to size, and replace it with an explanatory model that builds on what you have learned in Part I.

We also expand on why in Part I we emphasized national policy makers should view their economy from the prism of sectors.

The Austrian take on the business cycle is an interesting, but ultimately unsatisfactory, explanation of boom and bust. At most, their theory explains why fractional reserve banking can in some cases reinforce poor economic decision making.

But, as you will see, its explanatory power falls short in other important areas.

Especially compared to the theory we now introduce to you.

Alexander Hamilton’s Theory of the Business Cycle – In Hamiltonian theory economic boom and bust cycles are driven by changes in consumer demand for a type, or types, of goods and/or services. These cycles are usually concentrated in specific economic sectors in both the upswing and downswing phases.

In Hamiltonian theory, economic activity is usually born from a type of customer demand.

In the value signalling triangle of consumer, producer, and economic environment, the consumer signals what type of demand they have to producers.

The producer interprets these customer value signals.

If the producer believes satisfying the customer’s demand is valuable enough to the producer within the producer’s business environment, the producer adjusts its operations and allocates resources towards satisfying demand.

As mentioned in Part I of our series, the act of satisfying particular types of demand in one sector requires the producer to establish processes and allocate resources that differ in type and kind from those used in other sectors:

Types of customer demand leads to the creation of different sectors because different types of consumer demand frequently require producers to design different types of processes in order satisfy different demands: The medical industry exists to satisfy medical needs; the financial sector exists to satisfy financial needs, the housing sector exists to satisfy housing needs. Each of these sectors have developed substantially different types of medical, financial, and housing processes to satisfy the demand in their respective sectors.

Because satisfying different types of desires requires different types of business processes, different sectors ultimately allocate different types of resources in their business operations that are often not needed in other sectors: Medical processes are allocated medical resources, financial processes are allocated financial resources, housing processes are allocated housing resources.

Because what consumers, producers, and the economic environment signal as valuable is constantly changing, producers must continuously reallocate resources and fine tune business operations to align with changes in demand and environment.

This reallocation of resources and process tuning by the producer never ceases.

Because time is required for producers to adjust to new value signals, there is always a time lag between the moment when value is signaled by the customer and the environment and when the producer can act on this new information.

Just as trains moving at top speed cannot stop on a dime, businesses cannot reallocate on a dime during a boom or downturn because it takes time to alter the course of their planned business operations.

Continue reading “Robber Baron Capitalism in Four Lessons – Part II: Hamilton’s Theory of the Business Cycle”

Was Comey Building a Bogus Obstruction of Justice Case to Setup a Run for President?

Our motto is seeking a regression with minimal errors.

We pursue the error term in regression analysis because the model with minimal error terms – the mathematical representation of how close or far a model’s expected results deviate from actual results – is the model with the greatest explanatory power.

Have you lost faith in statistical models after the failure of climate modeling?

We assure you modeling is a productive field.  Unfortunately, like all fields, the reputation of statistics is vulnerable to the actions of disreputable practitioners.

Climate simulations certainly have not followed best practices:  If a simulation’s predictions constantly miss actual results, as climate models have for decades, the model is supposed to be discarded no matter how many trillions the “non-profit” Green Industry siphons to itself in grants, corrupt “carbon” trading arrangements, anti-carbon hysteria, and so forth.

Climate scientists do not care at all about good science, explanatory power or love the humble – very wrongly maligned – carbon atom.

But we do.

If Progressives can’t be trusted to build a model with quality explanatory power, the task falls to us.  Not just in climatology, but every topic we put under our the microscope.

And do we ever need some explanatory variables to explain the Russia investigation.

There are many variables to choose from in this drama.  The Democrats, NeverTrump deadenders, Hillary, the current administration, the former administration.

Out of all of them, the James Comey variable is the most informative variable because he was the only player whose actions throughout were always informed by full knowledge of whatever evidence was or was not found in the investigation.

We will put forward a theory, show that our theory best fits his actions, and then relate what it means for the Progressive movement generally.  The lesson – non-intuitively as so often happens with good statistical methodology – is that the Progressive movement should be more worried about being removed from power than Trump should.

Theory:  Comey was trying to setup a case for obstruction of justice against Trump by gradually provoking him into making hostile comments in privately to Comey that, when added together, could eventually amount to a case for obstruction of justice.

We also speculate – though with less certainty than our main theory which holds he was building an obstruction case –  that Comey’s actions may have had in mind that if his obstruction case created enough of a political scandal that he could leverage the resulting media publicity into a Presidential run in 2020.

About the assumption made that the FBI has no evidence for criminal activity between the Trump campaign and Russia –

At this point, this assumption is solid.

It’s almost impossible to conceive how there could have been an underlying crime between the Trump campaign and Russia without the evidence leaking to the media after Obama’s intelligence services, Hillary’s opposition research team, Comey’s FBI, the entire Democratic party, multiple Congressional Committees, almost all of the Republican establishment, and every media outlet on the planet spent over a year obsessively searching for proof.

If there were solid proof the media wouldn’t be wasting time “inferring” from pieces of “memos” written on cocktail napkins by anonymous, second hand, sources that Trump tipped off the Russians to the great, classified, secret that Israel is conducting intel operations in Syrian cities controlled by ISIS.

Putin would have never guessed.

Continue reading “Was Comey Building a Bogus Obstruction of Justice Case to Setup a Run for President?”

Robber Baron Capitalism in Four Lessons – Part I: The Subjective Theory of Value

At Pragmatically Distributed we don’t mind ambitious multi-objective programming: We know how to hit our objectives. Today’s objectives – Demonstrate what role the state should play in economic value signalling, and justify the state designing the business environment differently for different sectors of the economy rather than treating all sectors equal.

We will also wean you Libertarians off of primitive Anarcho-Libertarianism and mold you into Capitalists worthy of Alexander Hamilton and Abraham Lincoln. Or, at least, we will mold those of you talented enough to adopt Hamilton’s Robber Baron Capitalism. Which is probably only a small number of you people, but that is of no consequence. It suits Hamiltonian interests given we are targeting an elite audience rather than a mass one; we can and will do very well by preferring quality to quantity.

To meet our goals we take Ludwig von Mises’ subjective theory of value, and use it to reject both Austrian economics and Progressive economics in favor of Alexander Hamilton’s Capitalism.

As a refresher, here is how Hamiltonians define the three major economic systems; Capitalism, Libertarianism, and Liberalism:

  • Capitalism – Government actors set the common business environment without favoring particular private actors; individual private actors are then free to take any business action within the boundaries of the established environment.
  • Libertarianism – Private actors set the common business environment without favoring particular private actors; individual private actors are then free to take any business action within the boundaries of the established environment.
  • Liberalism – Government actors set the common business environment without favoring particular actors; government actors then decide on all individual economic actions within the boundaries of the established environment.

We now introduce Alexander Hamilton’s Laws of Economics. Each of these laws are true for all types of economic systems.

Hamilton’s First Law of EconomicsNational Economic Performance is the Result of Process Efficiency

National economic performance is the aggregate of how efficiently processes satisfy customer demand with goods and services.

For any nation the more efficient the aggregate operations of individual producers are, the more optimal is the aggregate allocation of national economic resources.

 

Hamilton’s Second Law of EconomicsHow Efficient Processes are is a Function of a Triangle of Value Signals from the Customer, Producer, and Business Environment

Production processes are efficient if they allocate a minimal amount of resources (relative to alternative processes) to produce the most valuable (in the opinion of the customer) goods or services.

A Triangle of Value Signals influences how efficiently processes allocate resources in production. The three value signals operations are based on are:

  • What the customer views as valuable.
  • How valuable satisfying demand is to the producer.
  • How clearly information about value relevant to a given business environment is signaled to all economic actors in that environment.

The conditions of any given business environment depend on many factors, some of which are under a nation’s control, some of which are not: external military threats, degree and type of business competition, geography, natural resources, and so forth.

As far as environmental influences are under the control of government, those influences depend on the government acting as a neutral arbiter in the creation and enforcement of common rules for all individual actors. What role and influence the government should have in shaping the business environment is a special focus of this article.

When a producer tries to satisfy customer demand, the producer aligns their processes to use resources. If a process is efficient, fewer resources per unit produced will be allocated to that process, leaving those resources free to be used by other processes.

To create efficient processes, producers must be able to accurately (to the degree measurable) interpret value signals from the consumer and the economic environment. If the producer cannot accurately read what is valuable to the consumer and in the relevant economic environment, the producer cannot determine what activities are actually valuable to the producer. Without knowing what is valuable to the customer, producer, and environment, processes cannot be efficiently aligned to resources.

Governments should keep in mind there is a Darwinian advantage to be gained if producers with inefficient processes are driven out of business – if inefficient producers are driven out of business proportionally more resources become available as inputs for the processes of more competitive producers. The more resources become available to a growing share of efficient producers, the more efficient (hence, more powerful) a nation’s economy in its entirety becomes.

Continue reading “Robber Baron Capitalism in Four Lessons – Part I: The Subjective Theory of Value”

With the Dismissal of Comey Trump Trolls the Universe

Tonight President Trump fired James Comey because Pragmatically Distributed advised him to.

That must be the only explanation; because what other explanation could there be?

As is the glorious destiny of all the (increasingly numerous) Pragmatically Distributed lurkers who take the advice of this blog to heart, Trump will reap the benefits of following our wisdom.

In response to this Tuesday Night Massacre the Democrats will pursue the dead end of the supposed “hacking” into Hillary Clinton’s email server.  A server that was so poorly defended that Clinton would have been charged with criminal negligence in its setup had her last name been anything other than Clinton.

The Russia issue had looked to be exhausted, even from a narrowly partisan vantage point.  Instead of nabbing the entire Trump administration the Progressives succeeded only in taking down Mike Flynn too early to be of use to them, and embroiling Susan Rice in considerable legal complications.

Comey’s firing will be sure to renew the Democrat’s interest in a political dead end – if there were any hidden political treasure in the Russia investigation the Obama administration would have released it before the November election.  Since they released nothing we conclude Obama had nothing.

If Obama, having the great resources of the American intelligence community at his disposal, could find no crime to nail Trump with then the Congressional Democrats will surely also come up empty in any renewed investigation.

Trump, meanwhile, will be able to appoint an FBI Director who will pursue potentially criminal activities of the Obama administration and turn this newfound interest in Russia hacking against the Democrats.

What Trump partisan is partisan enough to strike fear into the Progressive Left?

We have at least one former mayor in mind –

rudy_giuliani_rockette