Nice Polite Republicans

You can buy this at here, if you want to for some reason

NPR, like a lot of self-consciously "mainstream" media (*cough* New York Times *cough*) is by self-construction a centrist  organization. By that I mean they've decided that "objectivity" doesn't mean a rigorous and fearless pursuit of facts so much as always being in between the poles (i.e. the center) of political debate, reporting uncritically and at least pretending to take seriously the opinions and arguments of both sides, regardless of how transparently bullshit they are. This strategy might frustrate Zoroastrians and other honesty enthusiasts, but it appears to have worked somewhat; NPR is more trusted among conservatives than CNN, MSNBC, or the New York Times, even thought its trust among liberals is solidly middle-of the pack, and its overall trust. Opinions on NPR are the least divided of any of the news sources polled there and NPR is considered by most Americans (though crucially not Republicans) to be unbiased.

What's going on here? How is it that NPR can despite their best efforts, become as much a symbol of effete liberalism as yoga and lattes? Simple. NPR acquired a reputation in the fever-swamps of the right-wing imagination for being part of a biased "liberal media" because they have some kind of journalistic commitment to reporting  facts in a manner that isn't pure propaganda. With American conservatives it always seems to be Cooper Union one way or the other:

The question recurs, what will satisfy them? Simply this: We must not only let them alone, but we must somehow, convince them that we do let them alone. This, we know by experience, is no easy task. We have been so trying to convince them from the very beginning of our organization, but with no success. In all our platforms and speeches we have constantly protested our purpose to let them alone; but this has had no tendency to convince them. Alike unavailing to convince them, is the fact that they have never detected a man of us in any attempt to disturb them.

These natural, and apparently adequate means all failing, what will convince them? This, and this only: cease to call slavery wrong, and join them in calling it right. And this must be done thoroughly - done in acts as well as in words. Silence will not be tolerated - we must place ourselves avowedly with them. Senator Douglas' new sedition law must be enacted and enforced, suppressing all declarations that slavery is wrong, whether made in politics, in presses, in pulpits, or in private. We must arrest and return their fugitive slaves with greedy pleasure. We must pull down our Free State constitutions. The whole atmosphere must be disinfected from all taint of opposition to slavery, before they will cease to believe that all their troubles proceed from us.

But NPR does not understand this. Or, perhaps they do understand this, but can't act on this understanding without losing the o-so-precious hard-won "trust" of that endangered species, the moderate Republican. I suppose I could be more fair, and say that what the really prize is being in middle, and that broad perception of being unbiased.

But regardless their strategy of center-ism frustrates certain lefty corners of the internet, who joke that NPR stands for "Nice Polite Republicans". I don't think that's true, per se, but I think that it gets at an important point.

Partly its because they can sit down they sit down and have easy, breezy conversations with Republicans like David Brooks, who is is either profoundly stupid or totally full of shit (either he didn't understand the intellectual enterprise in which he was engaged his entire adult life, or he did understand and is lying about it now). And part of it is, I think, aesthetic; that smooth, unflappable "NPR voice" seems out of place in these very flapped times, calmly reporting today's horror, outrage, or scandal. But the last thing is that NPR seems to project an out-of-touchness, a lack of alarm that implies they just don't get post-2016 politics.

Which brings me to this fascinating 2018 interview of Kathleen Belew by Teri Gross. Teri is interviewing Kathleen about her book, Bring the War Home, a scholarly history of post-Vietnam white supremacist movement(s) in America. Listen to the whole thing, its great. But what jumped out to me was starting around the 25:30 mark, Teri asks Kathleen about the 14 words and Kathleen won't say them, and Teri just does not get why Kathleen won't utter a white supremacist slogan.

And not getting that, in these flapped-up times, seems somehow egregious.

The No-Trade Theorem and Misgovernment

 There is a in financial economics a theorem that goes like this:

Suppose that 1) markets are in an efficient equilibrium, 2) there are no idiot ("noise") traders, and 3) the structure of possessing private information is common knowledge. If that were true then there would be no trades whatsoever.

To quote Wikipedia:

The idea behind the proof of the no-trade theorem is that if there is common knowledge about the structure of a market, then any bid or offer (i.e. attempt to initiate a trade) will reveal the bidder's private knowledge and will be incorporated into market prices even before anyone accepts the bid or offer, so no profit will result. Another way to put it is: all the traders in the market are rational, and thus they know that all the prices are rational/efficient; therefore, anyone who makes an offer to them must have special knowledge, else why would they be making the offer? Accepting the offer would make them a loser. All the traders will reason the same way, and thus will not accept any offers.

Now since we know damn well that asset trading happens a lot we know that this isn't true in general. Further for  any trade to occur either 1) some or all of the assumptions of the theorem must be false for a trade to occur or 2) the parties have to have different risk or liquidity preferences.

Which naturally leads me to parking meters.

In 2009 Chicago leased the cities parking meters (and associated revenue stream) to a private company for a large cash payment. A transaction itself isn't of a remarkable sort -  exchanging streams of payments for lump sums is the most basic kind of finance there is.

What is remarkable is that it obviously never make any sense for the city. If both parties have the same liquidity preferences (risk is negligible here) then by the no-trade theorem the transaction shouldn't have taken place. If the meters were worth more than the asking price, then the city would be better off holding onto them, if they were worth less the company wouldn't buy, and if the values were equal then the city is no better off - but since transactions aren't totally cost-less, there would be no trade then either. Same sort of logic as the no-trade theorem.

Of course, its possible that the city has different liquidity preferences than the buying firm. But this seems unlikely, given that the city preferred more liquidity, since they can issue bonds, access the money market, and have fairly predictable expenses and revenues. Its possible that the city could be considered to have a lower discount rate than the buyer, but that a (responsible) government would be more present-oriented than a private firm seems implausible.

So given that the sale happened, which of theorem's assumptions were violated?

There's no market here to be efficient, but we're just valuing a stream of payments which is a trivial problem. How about the structure of information? Again, knowledge about the value of this asset is symmetrical, and both parties know it.

The best case scenario here is that the city was indifferent between buying and selling at the sale price. If you believe that, do you have a toll bridge for sale?

So what we're left with is 2 (plausible) explanations: an idiot trader or a government that's incredibly shortsighted.

Either way, the lesson here is to assume any sale of public revenue streams that has a buyer is be a bad deal until proven otherwise.

Why the Government's Budget Isn't Like Your Budget

It is popular to analogize the household budget the governments budget to your household budget. Now, I'm a big fan of analogies. They can explain complicated notions in simple terms that are, technically, inaccurate, but get "close enough" to how things work.

But the analogy has to work, the correspondences have to make sense. The "government budget as household budget" meme isn't like that. Rather, it is very dumb.

How is the government's budget not like your budget?

Well, how is the government not like you?

1) You will die. Governments live for an indefinite length. This means that while you might have trouble borrowing money to be paid back over 100 years, little Austria can sell 100-year bonds - and the market thinks it'll lend to Austria at 1.2% interest. You try borrowing money for 100 years, and let me know if anyone is foolish enough to lend to you.

This long life with low borrowing costs has other benefits. If the economy (and thus government tax revenue) grows at 2% a year, and the debt costs 1.2% a year, then as long as the borrowing isn't too big, the government can borrow money forever and keep paying it back. This might not be a prudent plan, but its an option that's open to governments that isn't open to

2) You cannot rob people. Fools like to say"taxation is theft". Why this is foolish is for another time, but it does cut to the heart of the matter. If you decide one day you want to make an extra $10,000 you can't just go to a bank and demand to be given that money. Governments can do that. Maybe you think they shouldn't but they can. Your promise to pay someone back is a promise that you'll earn the money to pay them back. The government's promise to pay someone back is a promise that they'll tax the money to pay them back.

3) When you print money, its counterfeiting. When the government prints money, its monetary sovereignty. The US government borrows US dollars. It also controls completely the supply of US dollars. The risk to lenders is not (barring an insane sovereign default) that the US won't pay you back, but that it will print too much money when it does so.

4) Your borrowing costs are higher. By which I mean, right now the US can borrow money for a month for about 2% APY, about a tenth of the costs for the average consumer credit card. This dramatically changes the picture in terms of what is and isn't "responsible" spending and borrowing. If  you could borrow money for that cheap, what would you do?

There is No Such Thing as Safety

There is no such thing as safety; only degrees of risk.

This can be a very hard thing to wrap your head around. People want to engage in dichotomous, black-and-white thinking, and while this is easy and useful and isn't always wrong, it often is.

Save vs. unsafe is one of those false dichotomies. Because the truth is that right now, whoever you are, wherever you are, whatever you are doing other than reading this, and whenever you are reading this, you are not safe. A previously undetected asteroid could be hurtling towards earth at this very moment, about to kill all life on earth, an undetected brain hemorrhage could kill you in the next minute, a gamma ray burst could be hurtling toward us the speed of light, about to microwave the Earth on "high" before we even have time to panic.

The thing about all of those things is that they are incredibly, vanishingly, unlikely. So we feel "safe" from those things even though they could, technically, in theory, happen. Thinking probabilistically is basically an unnatural contortion of normal human thought patterns, and people almost never really do it, because frankly they don't usually have to. So they round up to 100% or down to 0%, and maybe if they are feeling particularly uncertain they settle on 50%. Then they live their lives as if those numbers where, y'know, correct.

The heuristic reasoning part - cognitive corner-cutting often enable human flourishing and is unavoidable anyway. I know people make trade-offs against risk and reward in all sorts of ways, and have heterogeneous preferences, but this "feeling of safety" thing is just weird to me. The most dangerous thing most Americans do is drive. They drive to work and worship, to pick the kids up from school and to get groceries and visit Grandma, and when people do all of these things most of them are confident they're good drivers and feel pretty safe behind the wheel.  The most dangerous jobs in America involve working with heavy machinery and being far from medical attention,  heavy machinery like a car.

And people shrug their shoulders and just get on with their lives! Meanwhile they panic about crime, which has been basically falling my entire life, or fight tooth-and-nail against nuclear energy, which kills fewer people than any kind of fossil-fuel power. People's intuitive senses of danger and risk seem to be finely honed for avoiding tigers and poorly suited for managing the "invisible" risks of modernity.

All of this bothers me immensely. Not the heuristics or the rounding but the sheer inconsistency of it all. Because what I want to be able to to is say "okay, so your said this is what you have to get in time, money, or something in order to be willing run these risks" but it changes completely depending on the threat, as if it matters even though dead is dead. We'll ban shuriken but let any jackass with pulse buy a fucking gun. We'll ban weed but build whole social lives around alcohol. People are willing to make the trade-offs inherent with using cars, but lose their damned shit over scooters.

Instead its all "feeling safe" and "feeling unsafe" - and they expect politicians to fix this! How? When people's feelings are so inconsistent? Building invisible bridges over invisible rivers, I suppose. But what do I do, no, what do we do when the politicians are fear-mongering and quaking in their boots at that invisible river? You can't magic people better.

Look, my dream job is social planner, but how am supposed to fucking do that if y'all can't even give my a straight answer on the risks you're okay with running.

An Example of Why Bicameralism in State Governments is Dumb, Dumb, Dumb

There are 50 state legislatures in America and 99 state legislative chambers. Only Nebraska did the the smart thing and set up a unicameral legislature. The bicameralism of the rest is dumb, dumb, dumb.

Nebraska, Land of Unicameralism

Let me illustrate this with an example from Indiana, a state with which I am fairly familiar. The Indiana General Assembly consists of two chambers, a House and a Senate in a poorly-thought-out imitation of the US Congress. The House has 100 members elected to 2 year terms, the Senate 50 seats (from 50 districts) elected to staggered 4 year terms, i.e. 25 are up for election every 2 years.

Why is this dumb? Because the Indiana State Senate is pointless. It serves no purpose. It is redundant, surplus to requirements, excess, useless, frivolous, and unnecessary.

The US Congress has two chambers because those chambers are meant to represent two different constituencies on two different basis. The Senate was initially (prior to the 17th Amendment) intended to represent state governments, while the house was meant to represent the "the People" (initially defined to mean propertied white men, but nevermind that now). Thus, two chambers were created, whose members would be elected in different ways. Representatives are elected for two-year terms from districts of equal population, while each state sent (or now, directly elects) 2 Senators to serve for staggered six-year terms.

The Indiana General Assembly does not do that. It has one chamber which consists of representatives directly elected from equal population districts and another chamber that also consists of representatives elected from equal population districts. This is dumb.

Adding more chambers creates additional veto points in the political process, gumming up the works and making it harder to get anything done, and adding legislators means more people who want favors or other considerations for their support to which tends to increase wasteful "pork" spending. This is dumb.

Staggering elections makes sense if you're electing multiple representatives from the same district, but if the districts all  have only one representative and serve for 4 year terms then half of the State Senators will be arbitrarily and perpetually "on-cycle" with the Governor, and half off-cycle. This might be desirable, as it allows people could decide to punish a governor in mid-term elections. But since the entire lower house, not just half of it, stands for midterm elections as well as on-cycle gubernatorial elections, the Senate adds nothing in this regard, also. Dumb.

As the sea of stupidity is bottomless, I'm sure I'm missing other dumb arguments, but I feel I've made my case well enough.

Is Violence a Natural Monopoly?

A long time ago, I saw a very heated argument in a comments thread on Hulu (yes really) between an anarcho-capitalist and a sane person. It went something like this, though truthfully I'm probably steel-manning the Ancap.

Ancap: We shouldn't have a state; the market will provide.
Sane: What about roads? Courts? Protecting your private property?
Ancap: The market will provide! Private companies will build the roads, and I'll pay a usage fee! Private arbitrators will resolve disputes like in 9th century Iceland or pre-colonial Somalia!
Sane: And your private property? Who will protect your stuff in this brave new world?
Ancap: I'll protect it myself or contract out someone to do this!

I think about that exchange a lot, and every time I want to reach through my screen, grab the Ancap by his (these guys are almost always male) shoulders and shout:

What could you possibly offer a mercenary that's worth more to him than just shooting you and taking all of your stuff right now? A series of payments over time? Congratulations motherfucker, you just invented the state! But not even a good state, with rights or democratic accountability or anything, but the most shitty, primitive kind of state, a mere stationary bandit. You've just reset political development back to square negative fucking one! The blood of millions shed over ten millennia to get to where we are now, boiling away in this stateless vacuum! All for what! For some macho bullshit, some myth of total self-sufficiency, or have you just not thought this through?

...deep breath...

And from that my mind turns to a more intellectual question: Is (legitimate) violence a natural monopoly?

Max Weber defined a state as being the institution with the monopoly on the legitimate use of force in some geographic area. But supposing an Anarcho-capitalist society existed, and there was a competitive market for legitimate violence. Would such a market remain competitive, or would a monopoly on legitimate violence (i.e. a state) emerge?

Having defined "state", let me define "legitimate violence". By "legitimate violence" I mean violence to protect property or enforce a contract or agreement.

Now my assumptions:
Suppose there were n mercenary firms,  numbering from 1 to n, with 1 being the most powerful and n being the least powerful.

Now if I contract with a firm, it can assuredly protect me against less powerful firms, but it cannot secure me at all against more powerful firms.

A firm will not destroy itself resisting a more powerful firm - i.e. it is costless for stronger firms to overcome weaker ones

The unprotected lose everything - even a lone individual cannot resist the least powerful mercenary. Thus all people would hire someone

But who would hire firm n, which cannot protect against any other? No-one, so firm n exits the market. But now firm n-1 is the weakest, and so its services are therefore worthless, and so it too must exit the market. Thus by induction, only 1 firm can exist in equilibrium. Thus a state emerges naturally from (capitalist) anarchy. Intuitively, the thinking might be summarized as "why would you hire the second strongest mercenary?"

This begs some questions.

First, if a single state is emergent from anarchy, how is that one universal state hasn't emerged from the present international anarchy? My simplified model must be omitting some important details - and indeed it its.

By assumption, distance to irrelevant in my model; all the mercenaries contest the same geography. A more "realistic" model would have a spatial component, weakening firms the further out they are from their "base". I suspect the the equilibrium there would have multiple firms spread out, like our present international anarchy.

My model also assumes the mercs have fixed strength relative to one another, although given the strong presumably have the greatest ability to earn money from their "customers", this seems to enhance a centralizing equilibrium.

And of course i ignores the role of prices in consumer choice.  I have avoided this so as to avoid solving equations to maximize utility, etc. which a reader might find tedious or intimidating. It won't make a difference though - as long as the leading firm asks for less than everything, their "customers" will pay it before losing everything.

Second, I assumed that overcoming weaker rivals is costless. If it isn't costless, then its possible for the profits gained from a new "customer" to be insufficient to justify the costs of acquiring them, and a firm could stay independent.

At this point, we've away from economics and markets and into international relations, so I'll bring it back into my comfort zone by asking the next obvious question: suppose there was a competitive market for "legitimate violence" - why wouldn't the firms just combine into a monopoly to maximize their profits? Such a thing could not be prevented in Anarcho-Capitalistan. And such a firm (state, now, I suppose) could maintain such a monopoly by murdering or co-opting anyone who threatens it. State monopolies are after all a time honored tradition.

What Is Even the Point of This?

I haven't been able to get this case out of my head lately, so I'm putting my thoughts into writing in the hopes that that solves my problem.

The facts are these - guy accidentally leaves two of his kids in a hot car, goes to work, and eight hours later they're dead. A fucking tragedy. I feel for the guy, for his wife and for his three surviving kids - their family's fucking torn apart and this guys gonna have to live with the guilt of that for the rest of his life.

Then the DA's office for the Bronx gets involved and decides their gonna make it all better the only way they can - by charging him with manslaughter and negligent homicide. What is even the point of this? What good will this serve? How will this advance justice?

The point(s) of the criminal justice system are (per Wikipedia):

1. Deterrence  - "we don't want people to do this, we need to make an example of him"
2. Retribution / Moral Support for Victim - "guys got to pay for what he did"
3. Rehabilitation / Reform - "he learned his lesson and won't do it again"

The guy fucked up and killed two of his kids. What could the criminal justice system do on any of these fronts that's more potent than what's already happened?

Who is reading this story and going "Well, I was planning on being a negligent parent and a risking the lives of my kids, but now that I see I could face criminal penalties for killing my babies, I'll shape up and fly right?"

What provides more moral support for the family of the victim by tearing that family apart even more than its already been torn apart.

And reform, do these guys really think that he negligently killed some of his kids but they if don't send him to prison he might negligently kill the rest of them?

The best, most generous possible fucking argument for the decision to go after this is that its just an awareness raising measure; but all of this - all of this! - the press coverage, the trial, and any potential punishment, is going to cost hundreds of thousands of dollars. You're seriously telling me that this is better way to raise awareness than dropping that cash on ad campaign? That you're willing to throw a guy in prison for years as fucking publicity stunt?

Why I Fear for American Democracy

"As a nation of free people we shall live forever or die by suicide." - A. Lincoln

The American political system is breaking down. The Constitution of 1789 is showing its age, and the duct tape that kept the system from flying apart is being gleefully ripped up by a Republican party in the teeth of a trilemma; that is, they can choose any 2 of:

1) Hold onto political power

2) Moderate or compromise on policy

3) Compete in free, fair, and democratic elections - i.e. maintain the norms and spirit of democracy.

To abandon 1) is to be the California GOP - electorally irrelevant, but large enough to crowd out any new 2nd party, leaving power in the hands of Democrats. To abandon 2) is, well, the normal thing that a party would do if it believed in winning free and fair elections.

But their deeds show their hearts;  it is point 3) that they have abandoned.

In their efforts to restrict the franchise, to obstruct access to the polls,  to control the courts, to gerrymander legislatures, to rely on the Electoral College to win the Presidency and on an absurdly over-represented collection of states to control the Senate, they have leaned into every single un- and anti-democratic part of the American political system to worm their way into power despite their extremism and unpopularity. They would not do these things if they aimed to win fairly.

I do not know how long our political system can survive if one party gives up on it. The last time that happened in America, we had the Civil War and only after horrific bloodshed democracy was triumphant, for a time. After the war, there were free and fair elections in the South for the time. But the Southern Democrats were ever hostile to democracy, and after the end of Reconstruction they established authoritarian one-party states throughout the South.

So my fears are not unfounded - it can happen here because it did happen here. But just as the Democrats of yesteryear never truly accepted Reconstruction, the Republicans of today do not accept that anyone other than their coalition of would-be theocrats, white supremacists, and plutocrats can legitimately hold political power. While democracy (only resurrected in the South after the Civil Rights movement) allowed them to hold power they participated in it and defended it - but now that they are loosing popularity they seek to rig the game rather than appeal to voters.

Perhaps we will survive all of this, and democracy will prevail, hopefully without bloodshed.

Or maybe the forces of reaction will win, and we'll see America turn into Hungary or a Jim Crow  regime everywhere. I think it will seem very normal, especially to the winners; the God-botherers will get to stick their noses in everyone's business, the racists will be free at last to throw slurs, punches, and bullets with total impunity, and the plutocrats will be able to hoard a thousand lifetimes worth of wealth without anyone asking them to contribute a dime to the general welfare or the common defense.

Are There Cycles in American Politics?

I like to say there are two kind of scientific results; things your mother could have told you, and things your mother did tell you that were wrong. The whole point of science is that you don't know which is which until you test them.

At various times from various people I have heard expressed a folk theory of American politics that "these things go in cycles" and "politics is like a pendulum".

But is this true?

My investigation started with Arthur Schlesinger Jr.'s (that Jr. part is important) 1999  essay in The Cycles of American History that addressed my question quite directly, and laid out an account of cycles in American politics.

It turns out that the theory that American politics proceeds in cycles is an old idea, which I suppose makes sense for a folk theory. Ralph Waldo Emerson describes a cycle of reform in 1841 and Henry Adams (yes, one of those Adams's) described such a cycle writing in the 1890s. Adams saw 12 year cycles in American politics, alternating between centralization and diffusion. Arthur M. Schlesinger Sr. saw those cycles as 16 year cycles alternating between liberalism and conservatism, and counted 11 such cycles in 1949. Junior describes some other theories of cycles, and reasoning that this is driven in part by generational change, and leaning on the works of Jose Ortega y Gasset and Karl Mannhiem and his father, comes to an estimate of American political cycles that last about a generation - 30 years or so, up and down.

Now, all this is well and good; but when it comes to theories of history I always worry about painting a target around the arrow, overfitting to our limited data and small sample size. So my next question was: "has anybody actually tested this?" And surprise, surprise, this hypothesis jumped the fence and ended up in political science country, where, sure enough, my Googling revealed a paper testing Juniors's hypothesis - and finding it supported. Merill, Grofman, and Brunell analyze party vote share between 1854 and 2006 and clearly identify cyclical patterns. Reading a 2014 piece  by Helmut Norpoth which briefly reviews the evidence for cycles in American politics, and reading all this it seems to me that the partisan cyclicality of American elections is fairly well established fact. Which in itself is probably sufficient  to validate the folk theory and prove momma right.

But Emerson, Adams, both Schlesingers and all the other historical theorists are positing more than partisan cyclicality. They see an ideological cyclicality in American politics, with Americans not just swinging between Republicans and Democrats, but between left and right. The political science above can't speak to that, given how much the parties have shifted ideologically over that time.

In 1860 the Democrats were the party of treason in defense white supremacy, while in 2016 the Republicans now occupy that role. During Reconstruction, the Democrats were essentially the political wing of the Ku Klux Klan, while today, black Republicans are only slightly more common than unicorns.

So to answer the question of ideological cycles, I need other evidence. Enter James Stimson, who studies exactly this topic and has helpfully written a book addressing this very question. You'll have to make do with I could gather about its contents from a Google preview, since I was unwilling to buy it, too impatient to borrow it, and, despite valiant efforts, unable to pirate it.

But, dear reader, my gleanings were a treasure. Stimson looks at decades of polling on hundreds of issues and questions, trying to get at the underlying ideological mood of the American public, and sure enough his graphs show what looks a lot like an ideological cycle in American politcs, right around when the historical theorists and everyone else would think:

Stinson points out that his data suggest an interesting idea about these ideological cycles, which is that the public opinion change proceeds the political change, that e.g. Reagan was a symptom of a change more than a cause - which makes sense to me but does challenge a sudden-break theory of political change.

But I'd like to point out that all of this is only around 1 or 2 cycles worth of change, so while its suggestive evidence its hardly definitive proof of ideological cycles.

Still, all told, that folk theory looks pretty strong, and I'm fairly persuaded of it.

Nemesis of Reason (Part 1?)

Elsevier (1880 colorized)

There is an old joke from the Soviet Union that I like to retell, and it goes something like this:

An old man is distributing pamphlets in the street. This is very obviously counter-revolutionary political activity, so as soon as the police walk by they arrest him, and being good Communists they don't even glance at the contraband pamphlets as they seize them; their captain will know what to do.

The captain looks over the pamphlets and then storms into the interrogation room.

"These pamphlets are blank!"

The old man shrugs.

"What can I say that we do not all know already?"

This post might as well be one of those pamphlets.

Because everyone already knows that for-profit academic publishing is a racket; we are all perfectly aware that Elsevier is the Nemesis of Reason.

Or at least we ought to be. Because it is fucking obvious.

In 2017 the RELEX Group, Elsevier's parent company, reported an operating margin of 32%. Since the RELEX Group has some side hustles in data analytics, to isolate their profits from academic publishing I'll take Their science and technical division (pg. 14), which has the Elsevier brand along with such familiar names as The Lancet, Cell, and Science Direct, reported an operating margin of 37.5%.

These are the kind of margins more typically associated with criminal enterprises (for reference, Apple's operating margin was ~26%) But when you think about it, (and by think about it I mean do some critical thinking and basic arithmetic) it gets worse.

98% of their revenue is from collecting tolls as gatekeepers of information. 81% of their revenue is from electronic access. So 80% of their revenue (about ~$2.4 billion) is from gate-keeping digital content. The marginal cost of copying something digitally ins't exactly of something isn't exactly zero, but its so damn close I'm willing to call it zero.

The Racket from the Perspective of Producing the Marginal Article

An analytical distinction needs to made in analyzing the market for journal articles: are we counting the creation of the marginal article or the marginal copy of an article? That electronic copies of articles, journals, access to digital archives, etc. are overpriced is obvious (and I'll make that case in more detail later), but what about the production of a marginal article?

If we think about the production of the marginal article there are clearly costs in preparing the marginal article for publication; Elsevier claims to employ 20,000 (paid) editors.

But Elsevier does not, has not, will not, and can not pay people to write the 1.6 million articles that were submitted to Elsevier in 2017, or the 430,000 that were published. Except for those who were published in the double handful (190 out of the 2500) open access journals, those people either volunteered their labor or paid for the privilege of publishing open-access in a hybrid journal.

And what Elsevier demands as compensation for making an article isn't a pittance. The fee varies between journals, but the average the price charged is around $2300.

If they didn't charging people for the privilege of adding knowledge to their hoard, how much would it cost to actually pay all those people to to produce all that content? How much would it cost to run all of Elsevier as open access?

 If we are actually paying authors, at 430,000 publications, at, say 4000 words each and $1 per word (which is practically robbery for high-skill technical writing) that means it would cost Elsevier around $1.7 billion to actually, you know, pay their authors.

But of course, scholars don't write for money, (at least not directly). They write, for the love of learning, to clarify their own ideas, to qualify for tenure, to gain social status. In short, they write for intrinsic motivations, and for what the Hellenes would have called kleos, what we will call prestige.

Which is to say they are willing to write for free. Or at least, free from the perspective of their publisher.

The Elsevier makes basically all its money from people giving them things for free and then engaging in arbitrage; a business model more typically associated with solid waste management.

Is Volunteering  For Suckers?

Elsevier's fees for open access give us a floor for the expected present value of (lifetime!) revenue derived from the publication of the marginal article. Since the whole operation turns a profit, it must be the case that those revenues are at least sufficient to cover the costs. So we can use these fees estimate a lower bound of those publication costs.

Taking Elsevier's assessments at face-value (although I suspect the true number is lower) it would cost no more than $990 million dollars to have published everything in 2017, all 430,000 articles, as open-access.

The volunteerism of scientists and scholars in writing, submitting, and revising academic and technical publications is a precious resource, one that should probably be managed with care instead of being squeezed for profit.

But its not just individuals who are volunteering. Institutions of higher education invest sometimes staggering sums of money to enable their faculty to produce research, which is then given away to Elsevier who then charges those same universities to access the research they produced.

Frankly, I am astonished to see any institution acting so selflessly.

But it would make a lot more sense for someone to just cough up the billion dollars needed to make all this stuff, which is given away in a spirit of charitable goodwill to benefit everyone, actually available to everyone.

OK, but who would pay for that?

That is something that could be paid for entirely by a large non-profit,  the federal government, or a consortium of American universities. Since part of the point of the American academy is for education to subsidize research, a $50 charge per student,  across all of America's ~20 million college students, could pay for making all of Elsevier's publications in that year open access.

As for archiving and hosting older publications, it'd be another $10 more; the Wikimedia Foundation makes do with an annual budget of $80 million.

In fact, I think the Wikipedian model is a good vision for the future of academic publishing. Not the "everyone can edit" part. But an open and accessible resource, maintained and sustained by a vast community of volunteer editors and contributors. After all, Elsevier's business model could basically be described as "like Wikipedia, but paywalled".

This whole analysis has been done with out estimating the social costs, social benefits, the long run drag on innovation, etc. All that could wait for another post. And I'm not trying to pick on Elsevier in particular, any for profit academic publisher would behave the same way.

But I hope alternative structures for academic publishing are possible.

It doesn't have to be this way.

[N.B. draft]