Paging Dr Galt

I’ve worked for the National Health Service in various parts of the country for just about all my adult life, and the whole time I’ve felt that I was doing a good thing, helping troubled people get better without worrying about whether or not they could pay me.

Now it turns out that all these years I have in fact been in the employ of an evil state-sponsored killing machine. Who knew? All those patients who tell me “Thanks Doctor, I feel much better now” are just spouting Orwellian Newspeak – what they really mean is “Curse you, you enervating quack! Ayn Rand was right! Your concern for my welfare is sapping the essence of my humanity!”

Well, now that I’ve been enlightened, I’m going to change my ways. No more ensnaring the unsuspecting poor in the corrupt web of socialised medicine. Only Objectivists who can pay on the nail will be getting my attention from now on.

Sarah Palin – Secret Socialist?

While we’re on the subject of Sarah Palin, there’s an interesting article in the Washington Post today, which examines the thinking in the McCain camp ahead of his choice of Palin as his running mate. There’s nothing terribly surprising – McCain needed someone who would bolster the “maverick” credentials of the ticket while at the same time appealing to the Republican base, and Palin appeared to fit the bill. What’s perhaps more revealing are the reasons he didn’t pick Joe Lieberman, who, in retrospect, might have helped make the race a bit closer. Lieberman’s liberal position on social issues, particularly abortion, were too hard to sell to the GOP faithful, despite the appeal they might have held for the wider electorate.

McCain’s real problem was that he was the candidate of a party that was hopelessly out of touch with the sentiment of the nation. He was fighting two battles – one to convince the GOP rank and file to come out and campaign for him, and one to persuade the nation that he was fit to be President. Unfortunately (for him, not for us) winning the former doomed him to defeat in the latter, since, almost by definition, someone who was acceptable to Republican activists was never going to appeal to normal people. Palin was just the icing on the cake, a clear message that McCain cared more for placating the wingnuts in his party than selecting a running mate who had even a modicum of competence.

Optimistic conservatives may argue that Palin has the potential to be a 21st century version of Barry Goldwater, who, despite his crushing defeat in the 1964 Presidential election is widely seen as the architect of the conservative takeover of the Republican Party, a process that gave us Richard Nixon, Ronald Reagan and Bushes Sr & Jr.

This ignores two important points. Firstly, the GOP in Goldwater’s day was run by a relatively liberal East-coast establishment, whereas the Republicans today are so far down the neoconservative rabbit-hole that there is no room for a further move to the right. Secondly, while Goldwater certainly ticked conservative boxes with his militarism, belief in small government and hostility to civil rights, his libertarian support for abortion and gay rights, anathema to present-day Republicans, provided some counterbalance.

Anyone hoping that Sarah Palin will reinvigorate the conservative cause is likely to be severely disappointed. If her time on the national stage is to have any long-lasting effect, other than providing stand-up comedians with an almost inexhaustible source of material, it will be to prove that the Republican Party must escape from the clutches of the extreme right if it ever hopes to win back the White House. Palin may go down in history as the woman who put the final nail in the coffin of the Republican Party as we know it, and in so doing shifted the whole of US politics to the left. Who knows? Maybe that was her secret plan all along.

Forward to the past

This time last year I was just starting to rekindle my interest in the US presidential elections, having gone off the process a bit after my favoured candidate, Hillary Clinton, failed to clinch the Democratic nomination. At that time it looked as though the race could be uncomfortably close, but that was before the Republicans unveiled their secret weapon, VP-nominee Sarah Palin, and the world breathed a sigh of relief, safe in the knowledge that Obama had it in the bag.

Ms Palin has been back in the news this month, having decided that staying on to complete the job she was elected to do in Alaska would be the “quitter’s way out”, and that she would show she was no quitter by, er, quitting. Now that she no longer has the tiresome responsibility of looking after the wellbeing of her constituents, she is free to start building her campaign for 2012.

It amazes me that anyone in the US, even those on the right, could think that Palin is the best shot the GOP has at regaining the White House, especially after the drubbing they received back in November. The one thing sure to keep the coalition that swept Obama to power together is the sort of intolerant social conservatism that may play well to the ever-shrinking right-wing base, but just alienates the rest of the population.

The Democrats would be much more vulnerable to the sort of fiscally conservative/socially liberal approach that’s being peddled by David Cameron and the Conservatives here in the UK. In a depression no one cares too much about gay marriage or abortion; they’re too busy worrying about losing their jobs and their homes.

I guess the Democratic and Republican strategists will be waiting to see how the election here works out, when it finally comes. It seems sure to be fought on economic rather than social issues. I think that there will be a real divide between the main parties this time around, with Labour proposing a continuation of deficit-funded government spending, which will, theoreticaly, kick-start the growth that will eventually pay off the national debt, while the Conservatives will be offering painful public sector cuts now with the promise of better times in the future. It’s difficult to see a Labour victory though, since the mood of the country, like the US last year, is for change, unsurprising when one considers the economic mess we are in.

Obama doesn’t seem to be making much headway in tackling the financial crisis; there’s every chance that come 2012 he could lose to a Republican candidate promising small goverment and a balanced budget. With Cameron in charge over here it will be the Reagan/Thatcher years all over again.

On second thoughts, maybe a Palin candidacy wouldn’t be so bad…

Bad reputation

Reports revealed this week that the UK government is maintaining an island in Second Life, at a cost of £12000 a year, for the purpose of allowing private companies to showcase new technology.

I would show you some pictures of the sim, but of course we mere taxpayers are not permitted to visit; only government officials and the firms taking part can gain access. The story has created a minor scandal, with opposition politicians seizing the opportunity to accuse the ruling party of “living in a fantasy world”, while the scheme’s defenders have claimed that holding meetings and events on the grid will greatly increase government efficiency.

My first reaction to this story was to think that £12000 a year was not a great deal of money, as government expenditure goes – it’s the equivalent of one very junior civil servant. Compared to the amount that, say, defence contractors gouge, it doesn’t seem to be the basis for a particularly lucrative business, even if the project is expanded when the pilot phase ends in 2011.

It also makes me wonder why government departments, or corporations, or educational establishments need to be connected to the main grid at all. Why don’t they run mini-grids on their own servers? That would be sufficient for meetings, presentations and teaching, without the risk of participants wandering out of the building and coming across something scary; it would also maximise control over access and security, and would presumably run faster and be more reliable. Most importantly perhaps, it would create some distance between the client’s business and the potentially toxic Second Life brand.

For the one thing that the man in the street knows, or thinks he knows, about SL is that it is a haven for sexual perversity of the worst kind, and while Linden Labs may insist that they have solved the problem by quarantining questionable content in its own continent, all they are doing is drawing more attention to the fact that the problem exists in the first place.

The potential customers that L-Labs are courting with their new U-rated strategy are probably not particularly worried that they personally will be exposed to anything untoward; they will be more concerned that association with Second Life will be a hostage to fortune. Political opponents, disgruntled shareholders or disaffected employees will be able to search Google images for something suitably salacious to take to the media; the result will probably be transient embarrassment rather than lasting damage, but why take a chance?

Real-life locations can reinvent themselves of course; I remember Times Square being pretty sleazy when I visited New York years ago, but I hear it is now thoroughly Disneyfied. I guess time will tell if Second Life will be able to undergo a similar process of rehabilitation.

I’m sure Joan would agree with me that Times Square was better the old way.

Intelligence Failure

I can still remember the story on the front page of the only copy of the Seattle Post-Intelligencer that I ever bought – it was a report on the assassination of Rajiv Ghandi, which means I must have purchased the paper on the 22nd of May 1991, when I was travelling up the Pacific coast on my way to the Cascade Mountains.

If if I ever make it back to Seattle (which I hope I do one day, because it is probably the nicest city I have ever visited) I won’t be able to buy the paper again, because, as of today, the S P-I has become an online-only operation, after 146 years in business.

The print newspaper model – where investigative reporting was subsidised by advertising sales – has collapsed, as ad revenue has migrated to the web. What will fill the news-gathering vacuum left behind? The idea that an army of bloggers will ever replace the likes of Woodward and Bernstein is patently ridiculous.

Information may seem to be more freely available then ever, thanks to the ubiquity of the internet (in the developed world at least), but the real knowledge, the stuff the Man doesn’t want us to know, will be buried even deeper in the mass of celebrity trivia and idle speculation that passes for news in the blogosphere. We are doomed to a new age of ignorance. Only musicians can save us now.

On the margins

I don’t expect that my last post, in which I proposed that the value of virtual objects is effectively zero, will have caused a great deal of consternation in the SL commercial community, since I’m guessing that not many of them are overly impressed by Marxist economic analysis.

What if we take a look at the question from a more capitalism-friendly economic viewpoint? In general, non-Marxist analysis tends to reject the idea that commodities have intrinsic value (as is proposed by the labour theory of value) in favour of a more subjective formulation; the exchange-value of an object is what it will fetch in a free market, which in turn is dependent on the level of demand and supply.

This kind of theory is popular in financial circles, since it implies that value can be generated purely by the process of exchange, and that bankers and their ilk are actually wealth-creators, rather than parasites who have grown fat on the the toil of the labouring classes. (Though we’ve been hearing less of such triumphalist talk recently).

That aside, does a supply/demand model of value give us hope that Second Life commerce can be viable in the long-term? Sadly, no. The problem lies in the concept of marginal value. According to the theory, exchange-value is determined dynamically by the balance between the prospective buyer’s desire for an item and the level of supply. That desire is not constant though – it decreases as the buyer’s stock of an object increases. A man who has no oranges might be willing to buy them for a dollar each, but by the time he has bought ten he will probably be thinking of spending his next dollar on something else, though he may be persuaded to buy another if the price drops. The marginal value of an item is what a customer is willing to pay to get one more than he has already, and always trends towards zero. It may even go into negative territory if there is a cost associated with having too many items, such as storage charges.

The marginal value of most real-world items is maintained by their perishable nature. In Second Life though items last forever, so as residents age, and accumulate more stuff, their willingness to buy new things tends to decline. Even the most fanatical fashion-victims will eventually have enough clothes, shoes, or whatever, and retailers will have to drop their prices to tempt them into further purchases.

New avatars will still need to buy things of course, but since the percentage of people trying SL who go on to become long-term residents is quite small, it seems likely that the demographic will gradually mature, and the economy will stagnate. (There will be a subsection of the population for whom shopping is an end in itself, and for them the marginal value of new items will remain consistent, but I don’t think there are enough of them to maintain a growing economy).

So there you have it. Communists and Capitalists agree: the Second Life economy is doomed. People should stop wasting time trying to run businesses that have no future, and concentrate on exploiting the real potential of virtual worlds; the chance to create new kinds of art and entertainment, and to experience the myriad different forms of interaction that the grid gives us access to.

Less than zero

What determines the value of an object in Second Life? I’ve been thinking about that since reading this article a few weeks ago. The answer given in that post – the market strikes a balance between what a vendor wants to charge and what buyers are willing to pay, based on the perceived utility – has face validity, but also a number of problems. There are often glaring inconsistencies between price and usefulness (I got my house for free; Olivia paid L$600 for her boots), objects that are practically identical can have wildly different prices (she could have got a similar pair for L$200), and there is little price stability (this week they’re down to L$50). There are factors that partially explain these anomalies; the SL market is fragmented and inefficient, there are big differences in the usefulness of virtual objects and their real-life counterparts, and the low value of the Linden dollar compared with that of user time discourages shopping around for the best deal. Even so, the model seems rather unsatisfactory.

Is there a more objective method for calculating the intrinsic worth of virtual objects? Old Bolshevik that I am, I tend to fall back on the labour theory of value. We are interested in those objects that are produced for the purpose of exchange, that is those objects which are commodities; according to the theory the exchange-value of such items will be proportional to the socially necessary labour-time involved in their production. (Socially necessary meaning the time taken for the worker of average skill labouring under average conditions, rather than the time taken by any particular worker, who may be more or less efficient than average).

So far, so good. The value of an object appears to depend on how much work its creator puts into it, assuming they are of at least average skill, which seems fair. Virtual items are different from those in the real world in one crucial respect though – they may be copied with practically no effort. (By this I mean copied by their creator for sale, rather than pirated). However many hours of work go into making the prototype, the value of that labour is diluted, potentially infinitely, by reproduction. Thus the value of any one copy will trend towards zero.

To get around this a content creator could produce unique items, or at least very limited editions, which in theory could command premium prices. There are a couple of problems with this though; unless you are a virtual Yves Saint Laurent no one is going to pay significant sums for your work, and even if you do have exceptional prim-sculpting talent the market for such work is going to be so restricted that you are unlikely to be able to earn a living. (In the real-life fashion industry the top designers make relatively little from their haute couture collections, since the volumes they shift are tiny; the real money is in the diffusion lines). If your design skills are no better than average then you’re in an even worse spot; even if you don’t go down the mass-production route, as long as a few other producers of comparable goods do they will reduce the socially necessary labour-time for the creation of your product, and its value will inexorably decline.

Is there any empirical evidence that this theory is correct? It’s difficult to get hold of meaningful economic statistics regarding Second Life commerce, but anecdotally there does seem to be a feeling that the volume of low-price and free items available is increasing, and that the quality of the free stuff is much better than it used to be; it’s certainly significant enough to support a whole SL Freebie” blogging subculture.

Second Life is copying real life, at a characteristically accelerated pace; the declining rate of profit is on the verge of producing a crisis of over-production. In the real world the point of crisis can be postponed by expansion of credit, though when this comes unstuck, as it has done recently, things tend to go spectacularly wrong, and capitalism is forced to fall back on the traditional remedy of economic depression and/or global war, to destroy unproductive capital and create the conditions for a new round of accumulation.

I don’t think that the Second Life economy will actually collapse though; owners of chronically unprofitable virtual businesses are likely to subsidise them indefinitely, just so they can hold on to their dreams of escaping the real-life rat-race, and this constant inflow of capital should be enough to prevent a crisis. (So long as the non-virtual crisis doesn’t consume Linden Labs).

Is there a better way to solve things? My ideal would be Second Life (and real life too) operating as a cooperative, collectively owned by its residents, who would each receive a social wage, and would freely contribute their talents for the betterment of the whole virtual society. “From each according to his ability, to each according to his needs” as the saying goes. I’m sure there are a few sims running on this principle, but my feeling is that the prevailing political tendency in SL is Libertarianism rather than Communism, so it may be some time before the virtual proletarians throw off their chains.

The best laid schemes

I dined tonight on haggis, tatties and neeps, in honour of our national poet, Robert Burns. January 25th, Burns Night, is always well observed here in Scotland, and all around the world, but this year is particularly special, being the 250th anniversary of his birth.

I’m very partial to haggis at any time of the year; when I was a student there was seldom a week that went by in which I did not consume deep-fried haggis with chips at least once. As the years have passed I have come more to resemble Burns’ description of those who love this particular delicacy:

But mark the Rustic, haggis-fed,
The trembling earth resounds his tread.

so I partake of it less, and usually opt for the boiled version rather than the battered one.

Burns has to some extent been buried in the tartan-hued mythology that passes for our national identity, but the character of the man, and the power of his work, transcend any shortbread-tin cliché. The words of “A Man’s A Man For A’ That”, his ode to equality and internationalism, have justly made Burns a hero to movements for social justice the world over:

Then let us pray that come it may,
(As come it will for a’ that,)
That Sense and Worth, o’er a’ the earth,
Shall bear the gree, an’ a’ that.
For a’ that, an’ a’ that,
It’s coming yet for a’ that,
That Man to Man, the world o’er,
Shall brothers be for a’ that.

On a personal level, I marvel at the way Burns can conjure a profound insight into the human condition from the seemingly mundane events of day-to-day existence. I often find myself reflecting on the truth of this stanza from “To A Mouse”:

But, Mousie, thou art no thy lane,
In proving foresight may be vain;
The best-laid schemes o’ mice an ‘men
Gang aft agley,
An’lea’e us nought but grief an’ pain,
For promis’d joy!

Or this one, from “To A Louse”:

O wad some Power the giftie gie us
To see oursels as ithers see us!
It wad frae mony a blunder free us,
An’ foolish notion:
What airs in dress an’ gait wad lea’e us,
An’ ev’n devotion!

More than anything though I love Burns’ comic sensibility, his ability to prick the affectations of the pompous and self-righteous, and to lighten the heart of the honest sinner with the sympathetic recognition of human frailty. My favourite amongst Burns’ poems is a toss-up between “Tam O’Shanter” and “Holy Willie’s Prayer” , for I share both Tam’s weakness for earthly pleasures:

O Tam! had’st thou but been sae wise,
As taen thy ain wife Kate’s advice!
She tauld thee weel thou was a skellum,
A blethering, blustering, drunken blellum;
That frae November till October,
Ae market-day thou was na sober;
That ilka melder wi’ the Miller,
Thou sat as lang as thou had siller;
That ev’ry naig was ca’d a shoe on
The Smith and thee gat roarin’ fou on;
That at the Lord’s house, ev’n on Sunday,
Thou drank wi’ Kirkton Jean till Monday,
She prophesied that late or soon,
Thou wad be found, deep drown’d in Doon,
Or catch’d wi’ warlocks in the mirk,
By Alloway’s auld, haunted kirk.

and Willie’s tendency to think well of himself:

I bless and praise Thy matchless might,
When thousands Thou hast left in night,
That I am here afore Thy sight,
For gifts an’ grace
A burning and a shining light
To a’ this place.

and remembering Burns’ verses keeps me on the straight and narrow.

The pith o’ sense an’ pride o’ worth
Are higher rank than a’ that

Yes he could

I had been planning to go to bed early on election night, since I had a busy day ahead, and I was, after all, completely confident that Obama would win, but in the event I couldn’t bring myself to retire without seeing at least some of the returns. I ended up staying up until about 1.30, when the result from Pennsylvania came in.

McCain’s fading hopes of victory had rested on the idea that the white working-class voters who supported Hillary Clinton in the primaries would, faced with an Obama candidacy, switch to the GOP, or at least stay at home. If this was going to happen anywhere it would have happened in Pennsylvania, and when even Fox News called the state blue within a minute of the polls closing it was clear that the game was up.

The theory that Obama was going to turn off the Democrat base was based on a complete misunderstanding of what happened in the primary campaign. Those voters who favoured Clinton over Obama did so because they were worried about his electability, not because they thought he was too radical. There was never any significant policy difference between the candidates; if anything Clinton is further to the left. Once Obama was the candidate the party was always going to be behind him, united by a desire to defeat McCain.

Could McCain have done anything to stem the tide? Probably not, given the state of the economy and the electorate’s determination to hold the Republicans responsible for the mess. He must be thinking that he could have played a bad hand a little better though. As McCain gave a valedictory speech to the press on his campaign plane, Joe Lieberman could be seen at his shoulder, like Banquo’s ghost. Might a McCain/Lieberman ticket have prevailed? We’ll never know.

Anyway, that’s all the excitement over for four years at least, and probably for eight. I can get back to blogging about important stuff like Second Life

A message to my friends in the US of A

[Thanks to Matt Groening.]