Wal-Mart v. Dukes: the Plessy v. Ferguson of Our Time

When the Supreme Court ruled that "separate but equal" facilities for persons of different race did not violate the rights of American citizens, Justice John Marshall Harlan dissented.  His reasoning was unassailable.  Coloreds born here were citizens.  Furthermore, the law allowed new immigrants from Africa to attain citizenship. Asians were not allowed to become citizens.  Yet, Chinese could ride in train cars with white people, while blacks were denied.  Not unusual in Louisiana, Homer Plessy was visibly white.  He had to assert his color in order to be arrested.  Seen from any perspective, the law was unjust.  The majority of the court did not agree.  History proved them wrong.  So, too, with Wal-Mart Stores, Inc. v. Dukes, et al., 564 U. S. No. 10–277 (2011).  Justice Ruth Bader Ginsburg wrote the dissent, with Justices Breyer, Sotomayor, and Kagan joining.

You owe it to yourself to read the Dissent.  The slip opinion is available here on the Supreme Court website as a PDF.

The errors of the majority are many and consequential.  Regarding the experts, the Court said:

"The only evidence of a “general policy of discrimination” respondents produced was the testimony of Dr. William Bielby, their sociological expert. Relying on “social framework” analysis, Bielby testified that Wal-Mart has a “strong corporate culture,” that makes it “‘vulnerable’” to “gender bias.” Id., at 152. He could not, however, “determine with any specificity how regularly stereotypes play a meaning-ful role in employment decisions at Wal-Mart. At his deposition . . . Dr. Bielby conceded that he could not calculate whether 0.5 percent or 95 percent of the employment decisions at Wal-Mart might be determined by stereotyped thinking.” 222 F. R. D. 189, 192 (ND Cal. 2004)."

The plaintiffs had another expert witness.  Dr. Richard Drogin provided the maths.  His testimony was ignored in the majority opinion.  If any generalizations about men and women are real, it is generally true that women are more attentive to detail than men.  The Dissent picked up on Prof. Drogin's evidence.

"Finally, the plaintiffs presented an expert’s appraisal to show that the pay and promotions disparities at Wal-Mart “can be explained only by gender discrimination and not by . . . neutral variables.” 222 F. R. D., at 155. Using regression analyses, their expert, Richard Drogin, controlled for factors including, inter alia, job performance, length of time with the company, and the store where an employee worked. Id., at 159.5 The results, the District Court found, were sufficient to raise an “inference of discrimination.” Id., at 155–160.

You don't need a lot of statistics or regression analysis.  "Women fill 70 percent of the hourly jobs in the retailer’s stores but make up only “33 percent of management employees.” 222 F. R. D., at 146. “[T]he higher one looks inthe organization the lower the percentage of women.”

I have a general rule that you can take the people on one side of the counter and switch them with the people on the other side and get the same results, not much worse, and probably better.  Birds of a feather flock together, no suprise in that.  So, Wal-Mart, Inc., reflects the society and culture of their sales areas: rural, small town, conservative, mainstream.... and a generation behind the rest of the nation. 

As noted in the previous post, in theory, Wal-Mart's discrimination against women should cause female employees with upward aspirations, to create competition or to take their talents to competitors.  This seems not to be the case.  Many factors come into play.  Opportunity is a matter of perception.  And, perceptions, aside, it must be attainable, rather than academically theoretical.  Wal-Mart profits from the disadvantages of its skilled employees.  Those profits, however, do not pour directly into a vault of bills and coins in which the heirs porpoise around like Scrooge McDuck.  Before that can happen, Wal-Mart customers must benefit from the advantage of skilled, interested, motivated, exceptional hourly employees who otherwise would be in management.  Wal-Mart customers get what they want, when they ask for it.  The shelves are stocked.  Check-out lanes move briskly.  It brings customers back, even as it costs the corporation in lost talent.

Wal-Mart v. Dukes

Sociologists are upset.  The American Sociological Association filed an amicus brief in the case of Wal-Mart versus Dukes to defend their study against claims that it is not scientific.  The case itself, and the ASA stance, both deserve the close and deep investigation which they will receive over time.

As a criminiologist, I consider myself a sociologist.  Crime could be considered a psychological problem or a medical condition or a form of economic engagement or a kind of political science.  Sociology encompasses all of those and more.  To me the defining space is that alone on his island, Robinson Crusoe's opportunities for crime are limited.  Crime is the sine qua non problem of every society.  Crimes begin as harms; and the plaintiffs in Wal-Mart v. Dukes claimed that they were harmed, and that under law, this was criminal.

The Wal-Mart employees obtained from sociologist William Bielby expert support for their claim that the corporate culture is discriminatory.  (Dr. Bielby served as president of the ASA in 2002-2003.)  Bielby's work was rejected by the Supreme Court of the United States.

Bielby’s testimony does nothing to advance respondents’ case. “[W]hether 0.5 percent or 95 percent of the employment decisions at Wal-Mart might be determined by stereotyped thinking” is the essential question on which respondents’ theory of commonality depends. If Bielby admittedly has no answer to that question, we can safely disregard what he has to say.  It is worlds away from “significant proof” that Wal-Mart “operated under a general policy of discrimination.” Supreme Court of the United States, Syllabus, WAL-MART STORES, INC. v. DUKES ET AL.  CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR THE NINTH CIRCUIT No. 10–277. Argued March 29, 2011—Decided June 20, 2011 

The ruling by the Appeals court brought up the Daubert Standard, questioning whether the sociological investigation met that measure.  In fact, fhe Daubert Standard applies to non-scientific expert testimony, as well.  Whether or not sociology is a science, it is a recognized field of academic study, no less dependent on the development of expertise than are music, theater, or art.

Whether sociology as a science must follow the forms and methods of physics is a different question entirely.  The sociology of humor might be entirely descriptive and not statistically validated - even if there is nothing funny about this case - and still be science.

Restraining sociology to the same  practices as physics may be invalid on the grounds that humans are more complicated than billiard balls.  This applies to the law, well.  Justice depends on the "reasonable man" (person) finding fact.   Last night, I attended a presentation on contract negotiation sponsored by Ann Arbor SPARK our entrepreneurship incubator.  The first speaker offered common sense as your reliable guide to know whether or not contract terms are essential or tangential to the relationship. He did not have a statistically validated body of empirical evidence.  But he was, apparently, a recognized expert in the field of contract law, and his testimony on that would be admissible in court.

That a single sociologist cannot offer empirical evidence to support his claims does not remove sociology from the family of sciences.  It may say something about the sociologist or his theory.  Numbers are easy to find.  What is the male-female distribution in the population from which Wal-Mart draws its employees?  What is the gender distribution of Wal-Mart employees?  What is the gender distribution of Wal-Mart managers?  How likely is that outcome?    Do any other factors mitigate, as in professional sports, the raising of children, or among religious orders, obvious, structural gender biases.

If the distribution of employees by gender is not random, then discrimination may be in place.  Note, however, that "random" does not mean "evenly distributed."  The number pi is accepted as an infinite string of random numbers.  Yet, within it are curious runs of apparent patterns. They being apparent to us who make patterns does not invalidate their randomness.

The plaintiffs alleged, and the Supreme Court acknowledged, that at Wal-Mart promotion into management depends on subjective criteria, not objective standards.

Wal-Mart permits store managers to apply their own subjective criteria when selecting candidates as “support managers,” which is the first step on the path to management.  Admission to Wal-Mart’s management training program, however, does require that a candidate meet certain objective criteria, including an above-average performance rating, at least one year’s tenure in the applicant’s current position, and a willingness to relocate. But except for those requirements, regional and district managers have discretion to use their own judgment when selecting candidates for management training. Promotion to higher office—e.g., assistant manager, co-manager, or store manager—is similarly at the discretion of the employee’s superiors after prescribed objective factors are satisfied.

Measurable, objective performance standards are known in sports because every game has a score; and other player statistics are gathered, as well.  Yet, on any day, any team can beat any other (any solo can win over any opponent).  Building a team depends on more than getting players with good numbers. So, too, with much of life.  It may be true that in a completely anonymized world, 101 out of 201 people in any and every set will be males.  It may happen somewhere on Earth that 53 out of 53 in a business will be men.  I once worked a project with five other Michaels and a Michele.  What are the odds?

Wal-Mart v. Dukes may prove to be the Plessy v. Ferguson of our century: the dissenters - Ginsburg, Sotomayor, and Kagan - may win the day, eventually, in the history books.  If that happens, it will signal a deep change in society, not only in the USA, but globally.  One indication of that will be the loss of women with management skills to Wal-Mart's competitors.  

Junk Criminology as Pseudo-Science

Writing about the so-called "CSI Effect" Gregg Barack, Young Kim, and Donald Shelton focused on jurors.  Among the many challenging discoveries of their statistically valid investigation was the fact that less-educated people demand more physical evidence. The "CSI Effect" also runs strongly within professional criminal justice. 


Since the declaration of scientific criminology in the 19th century, police and prosecutors have sought out empirical evidence, relying on what were then new sciences such as  chemistry.  Cesare Lombroso claimed that scientific measurements could identify congenital  criminals. Dactylography (fingerprinting), graphology (handwriting analysis), polygraphs (lie detectors), and psychological profiling, were joined by laboratory analysis of fibers, hair, tissue, cloth, paper, ink, tire treads, shoe prints, typewriter keys, and just about everything else.

Sir Arthur Conan Doyle's Sherlock Holmes in the Strand Magazine became the public's model detective.  Not a mere rationalist Holmes's theories began with empirical evidence.  He studied cigar ashes. In his day, the electron was a theory.  Fifty years later high school students accepted it as basic knowledge.  Today, surgeons are guided by images created by positrons, the anti-matter analog of the electron.  Humans have been to the Moon; our cellphones depend on satellites.  We clone animals and  genetically modify vegetables.  It is not surprising that through this century, empirical evidence from the police laboratory is expected to reveal and convict perpetrators.  But not all science fiction becomes science fact. 

Shoe prints, tire prints, fiber analysis, hair analysis, handwriting analysis, and even fingerprints, all  lack scientific validation.  Scientific truths are statistically valid, large sample, peer-reviewed reports tested by double-blind experiments, explained by coherent theory for which there exists a standard of falsifiability.  The scientific method can be explained as three steps or 14, but it is always the creation and testing of a hypothesis by empirical methods.  A scientific truth is both rational (logically consistent) and empirical (known by perception).  


In the United States, the "Daubert Standard" amplifies and reinforces the Federal Rules of Evidence.  Flooded with expert witnesses in complicated civil and criminal cases, the courts needed a method for differentiating accomplished researchers in esoteric fields from charlatans.  It is bad enough that among the general public those who are less educated expect evidence that they are not equipped to evaluate.  The "CSI Effect" also runs strongly within the profession of criminal justice.  


 The "Criminology and Justice" blog (here) formed by European professionals centered on the Balearic Criminological Society has a recent series of "CSI" articles.  The latest touts the forensic efficacy of shoe prints.  Another is about the value of the forensic sketch artist.  It is true that a complete matrix of evidence can place the perpetrator with the victim at the time of the event.  It is also true that there exists no scientifically valid database of shoe prints; and police sketches of alleged assailants have been elements in wrongful convictions. These professional criminologists cannot differentiate rational-empirical methodology from pseudo-science.  And that is a crime.

The CSI Effect: A Bibliography
(Note that so far only the works of Shelton, Kim and Barack are statistically valid, applying appropriate mathematics to a large sample population.  Many other reports,  while informative, are largely anecdotal.)

• “The CSI effect reconsidered: is it moderated by need for cognition?” Dante E. Mancini, North American Journal of Psychology 13.1 (March 2011): p.155.
• “Examining the ‘CSI-effect’ in the cases of circumstantial evidence and eyewitness testimony: Multivariate and path analyses,” Young S. Kim,  Gregg Barak, Donald E. Shelton; Journal of Criminal Justice 37 (2009) 452–460
• “An Indirect-Effects Model of Mediated Adjudication: The CSI Myth, the Tech Effect, and Metropolitan Jurors' Expectations for Scientific Evidence,” Hon. Donald E. Shelton, Young S. Kim, and Gregg Barak, Vanderbilt Journal of Entertainment and Technology Law, Volume 12 Fall 2009 Number 1.
• "The 'CSI Effect': Does It Really Exist?" Donald E. Shelton, National Institute of Justice Journal 259. (17 March 2008) http://www.ojp.usdoj.gov/nij/journals/259/csi-effect.htm.
• “A Study of Juror Expectations and Demands Concerning Scientific Evidence: Does a 'CSI Effect' Exist?” Donald E. Shelton, Young S. Kim, Gregg Barak, Vanderbilt Journal of Entertainment and Technology Law Vol 9 No 2
• “The CSI effect: legitimate concern or popular myth?” Catherine M. Guthrie, Prosecutor, Journal of the National District Attorneys Association, Vol 41 No. 4 (July-August 2007): p.14
• “The CSI Effect,” Richard Jones and Arthur Bangert,  Science Scope (Nov 2006): p.38.

MORE RECENTLY ON NECESSARY FACTS

Minimizing the Likelihood of Bad Cops

Alternatives to Prison (Part 1 of 3)

Megacities

Hypatia of Alexandria

A MAN'S HOME IS HIS MARKET

We see the "castle" as a paradigm, not just because we are at war with our neighbors - Hobbes' war of all against all being the reason for government. For us, the home is primary protection against the elements. In the words of William Pitt:"The poorest man may in his cottage bid defiance to all the forces of the crown. It may be frail - its roof may shake - the wind may blow through it - the storm may enter - the rain may enter - but the King of England cannot enter." After all, the way to take a castle is to "storm" it. In the 20th century military assault was by "stormtroopers." In our time, Iraq was conquered by "Desert Storm."  In a society of open courtyards, verandas (a Hindi word, likely borrowed from Portuguese), decks, roofs with hanging gardens, patios, arcades and colonades, concepts of safety, security, and ultimately, property rights, must have other paradigms.

In Nelly Hanna's biography of Isma'il Abu Taqiyya, Making Big Money in 1600 (American University of Cairo Press, 1998) she tells of how he expanded his home to meet the needs of his large and successful family. Established as perhaps the leading merchant of Cairo c. 1000 AH (c.1600 AD), certainly as one of its prominent men of commerce, he already had built a warehouse - wikala - that in fact included living quarters for travelers as well as shops and storage. To do that, they could not use "eminent domain": they had to buy each parcel, maybe 100 feet on a side for a small plot. It took years, but it respected property rights. He still needed to accommodate his wives, concubines, servants, slaves, and visiting clients. To expand his home, he bought the house next door and knocked out a wall. This enlarged his courtyard, baths, and stables, as well as yielding more living space.

The climate of Egypt - in contrast to that of northern Europe - allowed and demanded open spaces, open windows, doors, and arches. Entrance to the inner rooms was guarded, certainly, but the margin between public and private spaces was gradual and contextual. Homes had gates, certainly. But a merchant needs to meet people. And they need access to him.

Contrary to the custom elsewhere - and contradicting our own easy assumptions - there was no harem, separate quarters for women. Women and their children were arrayed in their own spaces based on social status. A concubine who had borne a child rated more honor than a wife who had not. Women also brought their wealth and status with them into a marriage. His third wife, having no children, assured her own income by taking control of the "trust" (waqf) established by her brothers. They relied on her to be a better manager and apparently she did not disappoint them. Meanwhile, she was the wife of Isma'il Abu Taqiyya until his death.

After his death, his family split up, children inheriting their shares. Boys got twice the girls' share, but each child got something. (Compare primogeniture in Europe.) Wives did not inherit directly. His one wife with children - themselves now married - brought her family together in one of the inherited smaller homes, acquired the place next door, and knocked out a wall.By the time Ismail Abu Taqiyya was at his height of wealth (and health), his social space included the entire street of his home. He and a longtime friend had built their homes (and their wikalas) on the same street.

They acquired the neighboring properties piecemeal over time - respecting property rights, not only of the owners, but also satisfying the needs of those other waqf "trusts" which held property independent of the nominal owners.

This was not unique to them. With the government of the Mamluks fallen to the Ottoman Pashas who had not been able to exert control and who were themselves appointed for limited terms of office, the merchants of Cairo built and rebuilt large parts of it.

The piazza is a public space, but among urban Americans in the 19th century, it came to be a somewhat pretentious word for the front porch. For Americans, the front porch became the margin between the public street and the privacy of the interior home. Adults could sit and rock while children played games. Friends and neighbors could stroll pass and bid hello and good day. An industry arose to create special furniture for this special space. (As a measure of fire safety, the City of Ann Arbor forbids couches and other interior furniture from the porch. But in any case, it is unseemly: outdoor furniture is appropriate.) Europeans assigned to work in Detroit like Ann Arbor because our restaurants extend to the street, using the sidewalks for table spaces. (This fact was brought to my attention by engineers from an Israeli firm doing business here.) The margins between public and private spaces are blurred. It would be difficult to discuss anything illegal or immoral in such a context. Business and social life become transparent when conducted on the street. In such a context, you grant privacy by minding your own business.

Therefore, rather than the castle which holds against the storm, a commercial society of productive traders, offering values in voluntary exchange, is better served by a theoretical model or exemplar or pattern of open intercourse. That brings up promiscuity, the easy mixing of people, too easy for the Puritans for whom safety from the elements and their neighbors comes from being shut and shuttered.

In an open society, police without a warrant would be unwelcome in a home because they have no business there.

That openness is also reflected in the legal institutions of the time and place. There, four different schools of law - Hanafi, Maliki, Shafi'i, Hanbali - operated their own courts. In each, four different judges (qadi) heard cases. You could pick your judge. In addition, disputes among co-ethnics or co-religionists were expected to be handled within that community. Finally, of course, the Sultan and his Pasha could dispense state justice. Usually by proxy, as elsewhere and elsewhen, the ruler was nominally available to his people by direct appeal.

So, for a merchant such as Abu Taqiyya, different kinds of contracts were better (for him) registered with certain courts.

From our point of view today, it seems odd to learn that under shari'a law as practiced by the competing courts of Cairo circa 1000 AH is women sued - and were sued - on their own account. There is even a case of a Bosnian slave woman being sued. Women inherited their own money, managed their own estates. As now - as always - a woman with a forceful and compelling personality (usually from a wealthy family) could get some interesting clauses in her marriage contracts. By custom, a man is supposed to treat all of his wives equally. There is no way to enforce that -- usually. One woman had it written in and specified how many nights he was allowed to spend with the other wives, etc. As a clause in a marriage contract, it was enforceable. And if she left, she took her property with her. Contrast that with England or France of 1600 AD.

Also on Necessary Facts
The Family Business
Capitalist Culture
Thank-You Notes

Firefly: Fact and Value Aboard "Serenity"

This is an example of Romantic fiction as elucidated by Ayn Rand in her book, The Romantic Manifesto.  These characters act on the basis of their values.  While they each know their self-interest, for each that is different, based on their personal life experiences.  Thus, the show is about morality: beliefs becoming actions.  Those different goals bring tensions and conflicts.  

 This show ran 14 episodes in 2002 before it was canceled.  It was recommended to me by another libertarian, who is not an Objectivist. His brief mention on the Objectivist Living discussion board stressed the anti-authoritarian frontier theme.  I think that he missed the more salient perception.   This is not bootleg Romanticism, or smuggled values, but the real deal.

The hero is Malcolm Reynolds.  He owns a spaceship, Serenity, that hauls cargo and passengers.  Serenity is a "firefly" class ship, called so because the tail lights up when power is engaged.  These are sublight ships.  The story is set in the early 26th century.  FTL does not exist.  Terraforming does.  China and America have united to dominate Earth; and Earth dominates the Alliance of human worlds.  (There are no other sentient species.) Reynolds had been a "browncoat," a fighter in a sessionist faction whose revolt failed.  Now, he seeks the frontiers, not quite far enough away from the Alliance.  His crew of three consists of a former combat comrade and her husband who is the pilot, and also an engineer.  Also along for the ride are a hired gun, a non-denominational Christian "Shepherd," a professional Companion (prostitute), and two refugees, a doctor and his sister.

 Each of them has a defined self-interest.  Usually,  those coincide, thus the crew can function.  Often, however, their values are in conflict as their different goals require independent choices in each situation. 

The ship's hired gun, Jayne Cobb, was bought out from the men who hired him to kill Malcolm Reynolds.  Cobb says, and Reynolds understands, that if the deal is ever good enough, he will turn Reynolds over to the Alliance.  Yet, Jayne Cobb is there, at the ready, when he is needed because it is in his self-interest to do so. 

"... value is objective (not intrinsic or subjective); value is based on and derives from the facts of reality ... Every proper value-judgment is the identification of a fact: a given object or action advances man’s life (it is good): or it threatens man’s life (it is bad or an evil). ... since every fact bears on the choice to live, every truth necessarily entails a value-judgment, and every value-judgment necessarily presupposes a truth.  "Fact and Value" by Leonard Peikoff, Ph.D. here.

Malcolm Reynolds is a smuggler.  He achieves that by not getting caught and having the right-looking papers.  He and his crew do not need the attention that comes from having the doctor and his sister on board.  They are fleeing the Alliance because Simon Tam broke River out of a government lab that was deconstructing her super-genius mind.  But Captain Reynolds knows himself and his values.  Doctor Tam and River are his passengers, even as they endanger his mission. 

On The Atlasphere here you can find a review of Firefly that centers on creator Joss Whedon's fight to keep the integrity of his work. 

The enduring attraction of this work is evidenced by the continued "fanfic" (new fiction in the universe created by fans, usually canonic, sometimes not).  The Firefly Fan site is here.  The Firefly Wiki  includes characters, actors, a lexicon of the universe, and a guide to the Chinese spoken in the show.  You can watch the show on Hulu, TV.com, and Xfinity.Comcast.  If you watch it on DVD, you can enjoy the backstory and commentary about the struggle to create and maintain the integrity of the work.  A movie, Serenity, was released in 2005.  Much more about Firefly will be revealed by your web browser.

ALSO ON NECESSARY FACTS
Anthem as a Graphic Novel
Redshirts: Expendable in Fiction and Fact
Reflections on Atlas Shrugged Part 1
Nerd Nation

John Aglialoro Does Not Shrug

Atlas 2 and Atlas 3 are still in the works.  Obviously John Aglialoro was disappointed by the lack of response.  If everyone who bought the book saw the movie, the profits would have been monumental. The rumor that he was throwing in the towel apparently began with the LA Times Entertainment section, "24 Frames" story (here).  But a week later, Aglialoro told the Hollywood Reporter (here) that he is going forward after all.

On the Official Movie Website you can get the news, watch out-takes, and buy gear.  The company started a "Demand Atlas" campaign worldwide.  The "Demand Atlas" campaign here in Ann Arbor worked.  When the initial release was announced, only 10 cities were on the list.  The Demand Atlas clicks (via an Event marketing site) brought it to 30 metro areas and 300 theaters.   It ran for three weeks here in Ann Arbor.  And right now - two months later - it is still in Grand Rapids.  

The way theaters work, if you have a local social group that wants a movie, find out how many seats you need to sell.  In addition to the big name cineplexes, here in Ann Arbor, we have two theaters downtown that show second-run and art films.  One of the malls without a theater has a converted space with Dollar Movies, sort of a 100-minute babysitter, if you think of it that way.  Atlas Shrugged Part 1 is still earning income, though not making money and if your town has not seen a run, you might have an entrepreneurial opportunity.

Harmon Kaslow, Jeff Freilch, and John Aglialoro
from the Official Movie Website Gallery

Like Star Trek, LOTR, and Pride & Prejudice, this is an entertainment product that appeals to a fan market, rather than making one. Yet, the history of entrepreneurship shows that failures are the price of profits.  Interestingly, railroading itself provides a convenient paradigm, as many roads failed financially several times in succession, going through new receiverships or the same guys back again, until the economies of scale and interconnected lines finally allowed profits.  Yet, investors still poured in money.  (Read The Man Who Found the Money: John Kennedy Stewart and the Financing of the Western Railroads by Engelbourg and Bushkoff, Michigan State University Press, 1996.   Beginning as a grocer in the 1840s, Kennedy financed James J. Hill's Great Northern in 1890.)  Considering the 50-year history of Atlas Shrugged in particular, and Ayn Rand's influence in general, it is clear that we are not yet at the end of the line.  

These comments were first posted somewhat differently on the "Objectivist Living" discussion board. Read here. OL poster "Randall" provided Donovan Albanesi's “An Open Lettter to John Aglialoro” from his Culture of Reason Center blog.

ALSO ON NECESSARY FACTS
Anthem As a Graphic Novel
To Make Money
Firefly: Fact and Value Aboard "Serenity"
The Remarkable Story of Risk

Capitalist Culture

Instead of vilifying him for being an idiot, we should be praising Michael Moore for being a millionaire.

 The Invention of Enterprise: Entrepreneurship from Ancient Mesopotamia to Modern Times (Princeton University Press, 2010) is an anthology that gives an high level view of the broad history of trade and commerce.  (My full review published by Libertarian Papers here.)  In separate chapters, David Landes and Michael Hudson identify the difference between creative and corrosive capitalism. The latter dominates in societies that deny the former.  The editors generally point out that in any society, some people will take the best advantage of whatever modes are offered for personal advancement.

In Rome, glory came from looting provinces.  Making money was not honorable.  So the wealthy left the management of their businesses to their freemen and slaves.  In America today, we allow both the marketing of technology and gaining government subsidies.  It is not just that both are legal, but that culturally, we do not distinguish between them.  Instead of vilifying him for being an idiot, we should be praising Michael Moore for being a millionaire.  He should get a hero's medal for selling large volumes of what people want to buy voluntarily.  

Instead of praising clever children who memorize the Presidents in order, we should be teaching them that "LinkedIn started out in the living room of co-founder Reid Hoffman in the fall of 2002. The five original founders were Reid Hoffman, Allen Blue, Jean-Luc Vaillant, Eric Ly, and Konstantin Guericke." (Company "About" here. )  I am not sure how to commemorate the chic restaurants in Rep. Nancy Pelosi's district that won exemptions to opt out of Obamacare.  The avoidance of regulation should not be taken lightly. 

BOURGEOIS VIRTUE

Deirdre McCloskey developed her theories on "Bourgeois Virtue" over the past two decades.  She now has two books out, with a third on the way.  She investigates the topic from many standpoints.  Generally, she finds that the things we are taught to dislike about being middle class include the social graces that benefit and profit us all. 

A potent source of bourgeois virtue and a check on bourgeois vice is the premium that a bourgeois society puts on discourse. The bourgeois must talk. The aristocrat gives a speech, the peasant tells a tale. But the bourgeois must in the bulk of his transactions talk to an equal. It is wrong to imagine, as modern economics does, that the market is a field of silence. "I will buy with you, sell with you, talk with you, walk with you, and so following. . . . What news on the Rialto?"
For one thing, talk defines business reputation, as at the Iowa City cocktail party. A market economy looks forward and therefore depends on trust. The persuasive talk that establishes trust is necessary for doing much business.  "Bourgeois Virtue" by Deirdre McCloskey, American Scholar vol. 63, no. 2, Spring 1994, page 249,  here.

Today we have social media. Corporations hire people or not, and fire them, based on what is revealed on Facebook and Twitter.  Reputational gossip has become all the more intense.  In a global culture, other people in other places grew up with different expectations entirely.  Rather than forcing conformity and avoiding risk, hiring managers who want their firms to profit should have the mechanisms in place analogous to those engaged by entrepreneurs. 
Market theorist Henry Girard Manne suggests that insider trading is one of those. 

In the anthology cited above, the chapter on the Middle East by Timur Kuran pointed to a biography of a Cairo merchant.  Making Big Money in 1600: The Life and Times of Isma'il Ibn Taqiyya by Nellie Hanna is a detailed account of one merchant in one place.  It so happened that he had his choice of courts, four of them, from different schools of law, in which he could register contracts.  Abu Taqiyya flexibly extended his trade network by crafting the clauses in his agreements.  Benjamin Franklin would have called it "prudence."

A MAN'S HOME IS HIS MARKET

We see the "castle" as a paradigm, not just because we are at war with our neighbors - Hobbes' war of all against all being the reason for government. For us, the home is primary protection against the elements. In a society of open courtyards, verandas (a Hindi word, likely borrowed from Portuguese), decks, roofs with hanging gardens, patios, arcades and colonades, concepts of safety, security, and ultimately, property rights, must have other paradigms. As he became wealthy, Isma'il Abu Taqiyya extended and expanded his personal space until his large home dominated his street.  He shared that street with a partner who made the same arrangements. They also did this with their warehouses (wikalat), which served as storage, emporia, and guest lodgings.  Public life was gradually excluded from private contexts as the visitor moved inward from the business into the home.

The piazza is a public space, but among urban Americans in the 19th century, it came to be a somewhat pretentious word for the front porch.  For Americans, the front porch became the margin between the public street and the privacy of the interior home.  Adults could sit and rock while children played games.  Friends and neighbors could stroll pass and bid hello and good day.  An industry arose to create special furniture for this special space.  Europeans assigned to work in Detroit visit  Ann Arbor because our restaurants extend to the street, using the sidewalks for table spaces.  The margins between public and private spaces are blurred.  It would be difficult to discuss anything illegal or immoral in such a context.  Business and social life become transparent when conducted on the street.  In such a context, you grant privacy by minding your own business.

Therefore, rather than the castle which holds against the storm, a commercial society of productive traders, offering values in voluntary exchange, is better served by a theoretical model of ready communication.  Jane Jacobs made the same point in Systems of Survival.  It is the Trader's Ethic to be open and available to deals with strangers.  Thus, capitalism is inherently globalist and democratic. 

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Copy Rights and Wrongs

The Google Books Settlement Agreement and the conflicts that caused it touched on only some of the problems of intellectual property and rights to it.  The settlement was rejected by US Appeals Court Judge Denny Chin (summary here from Columbia U's Copyright Project and full text PDF of ruling from The Public Index).

Much is wrong with all of the argumentation from all parties.  The simplest fact is that Google provided a service to store library books and make them available to patrons via Inter Library Loan.  At root, it is no different than a climate-controlled building for storage, library cards for access, and padded envelopes for mailing - with one exception: the process creates another copy ...  many other copies... as many copies as anyone could want.  In fact, I made two copies of Judge Chin's ruling and put them in different directories, one in the "NecessaryFacts" directory for these posts; and the other under "CJ Others" for any future academic criminal justice discussion of copyright laws and violations. 

Michael Crichton was not alone in seeing this coming.  Back in 1983, in his book Electronic Life, he said that the inherent copyablity of electronic media removes it from all of our previous expectations of property.  He recommended that artists forego the concept of royalties.  Just get your money up front and move on to the next project.  While he did have a lot of those projects, I do not doubt that he cashed the royalty checks all along the way for each of them.  Back then, I cited Crichton's thesis in articles that I wrote touting a world of "softlife" reproducing itself without copyrights.  Of course, when Defense Computing magazine took an article that I wrote about Soviet computer technology, claiming that the lack of a copyright statement made it anyone's property, I called them up and talked them out of a hundred bucks.  Self-interest and hypocrisy can be so hard to tell apart.

So, too, with this problem.

Among the facets are so-called "orphan works" for which the copyright holder is lost, perhaps dead, generally hard to find in any event.  If not for Google, they would remain orphans.  Now that they are rescued, reproduced, archived, indexed, and available to the world, they have new value.  When the authors themselves are not clamoring for cash - a rare event or these would not be orphan works - then non-self-interested others hypocritically want someone else (anyone else not making a profit- but not they themselves investing their own resources) to do this for free, track down the authors, and force an arbitrarily fair amount of money on them. 

I find works of mine out on the Internet and usually I do not care, as long as the presentation looks nice and serves a moral purpose.  I already got paid what I asked for.  (There is a parable in the New Testament about that. See Matthew 20:2.)  Once - as in the case of Defense Computing - I found the Frances Lehman-Loeb Art Center of Vassar College presenting an article that I wrote on the definition of "coin."  I pointed out the plagiarism and offered to write them a new one at a fair price.  They took the page down and never replied to my offer.  (The offender was an undergraduate history major volunteering at the museum.) 

An artifact speaks of its maker.  Artifacts are semata: bearers of meaning.  Thus, you can attach property - without "mixing your labor" - simply by putting your sign to it.  That, in fact, is the basis not only for marking cattle, but, in our time, for creating money, even Federal Reserve Notes, which have no intrinsic value but have value entirely through meaning (symbol).

Symbols are not objective.  They depend on cultural context.  When the culture changes, the meanings change.  We no longer live in a time when the production of books is a barrier to the transmission of ideas.  Books always were sold for the printing, the paper, the binding, and not for the value of the ideas inside.  Evangelists give away the Word of God.  Even the Ayn Rand Institute gives away Atlas Shrugged to high schoolers who enter their essay contests.

Among the tangled roots is the fact that we get our ideas of property from a long history with land.  Exclusivity is based on a physical law: two objects cannot be in the same place at the same time.  Rivalry is based on the fact that the same object cannot be in two places at the same time.  But now they can.  Unlike a plot of land, two people can access the same copy of a work of art at the same time without being in the same place. To each, their view is personal and private.  Even only a few years ago, cassette tape machines had two different functions for PLAY and RECORD. Now they are the same function. 

The physics and metaphysics of land do not apply to cyberspace.  The court should have removed itself as lacking competent jurisdiction.  The institution best suited to bringing spontaeous order is the market.  The libraries owned the books.  Google owned the means of preserving them while maintaining public access. 

When these books were printed, our technologies were not contemplated.  It should remain there.  Times change. 

 Copyrights were invented as monopolies in 17th century England.  The first law was passed in 1709 (Queen Anne's Law of 1710).  Sooner or later, implants or something will give us all personal permanent memory.  Where will the law be then?  You will never forget a book you read and you will be able to recite it perfectly.  Musical performances and plays may also become self-replicating memes.  Sculpture will probably prove resistant to copying, though we do have 3D Modeling now. 

Locksporting

Opening locks without keys is one of the challenges historically associated with computer hacking, like gaming and Chinese food, chronicled in Steven Levy's classic, Hackers: Heroes of the Computer Revolution (Anchor Doubleday, 1984;O'Reilley 2010;  but available all over the Internet as a PDF).  So, it is fitting that at the SUMIT_2010 Conference (Security @ the University of Michigan IT, October 7, 2010), Deviant Ollam of The Core Group was again a guest speaker.  Sandwiched between techies Whitfield Diffie and Christopher Hoff, and government agents Melissa Hathaway and Marcus J. Ranum, Deviant Ollum was a hit with the crowd.  After his talk, outside the auditorium, he set up a corral of tables with locks and tools for people to play with; and he answered questions for about an hour.

His on-stage demonstration was fascinating, compelling, shocking, and revealing.  We throw shackles on our cages of servers, buying them at hardware stores and big box stores, and never considering how vulnerable they leave us.  It is pretty easy for someone to let themself into your racks, insert or copy what they want and then leave without a trace.  Or almost without a trace.  Deviant Ollam's presentation included forensics, showing the evidence of tampering.  But you have to know what you are looking for and looking at.

"Physical security is an oft-overlooked component of data and system security in the technology world. While frequently forgotten, it is no less critical than timely patches, appropriate password policies, and proper user permissions. You can have the most hardened servers and network but that doesn’t make the slightest difference if someone can gain direct access to your network equipment and server racks."  - Deviant Ollam, The CORE Group. "The Four Types of Lock: Physical Security is Data Security."

Shortly after that October 7, 2010, conference, I got interested in the problem of archiving and reporting on modern paper money (here on Necessary Facts).  I made a presentation about that at ArbSec, a local Ann Arbor computer security group that grew out of the DefCon734 chapter here.  Via ArbSec, I met A2 Locksporting, the lockpicking club.  Attending club meetings once a month, I learned how to pick a lock. 

Numismatists study all forms of money.
The threat of counterfeiting led governments to make their notes more secure.
It also led the USA government in Washington to install software,
firmware, and hardware on all personal computer scanners.
If you scan a current-issue Federal Reserve Note, they will know about it.
The EURion Project here on NecessaryFacts.

I also learned how to take a lock apart and put it back together, how to match a lock to its key, and other techniques.  It so happened that because of the Levy book - which I read when it came out, having hacked my first password in 1977 - I always kept keys. I have lots of them.  They can be useful.  You can make a lock "bump" with a old key.  An old key can be recut.  It might work on its own: locks are disappointingly generic.  If you only care about keeping out honest people, you can save money, time and grief, by paying attention to the codes on the locks, buying four or five identical ones at the same time. 

If you browse for lockpicking tools, you will find many sellers.  The Ann Arbor Locksporting Club seems to like Lockpicker's Mall. I like their website. From 2004-2010, I reviewed websites for the American Numismatic Association and I learned to look for reliable information, free articles, and open and honest statement of who owns the site and the company and where to find them in real life.  They meet those requirements. 

Core of Lock disassembled.

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Cities

 It is an easy claim commonly found in school books that cities evolved from agrarian communities that themselves were formed when pastoralists pursuing herds narrowed their ranges, domesticated animals and plants, and settled down.  In truth, cities evolved from the camps of successful hunter/gatherers who met to exchange their supluses.  Jane Jacobs suggested this in The Economy of Cities.  Her theory was validated by the excavations at Çatal Höyük in Turkey.   

First, Jacobs was an urbanist.  An immigrant from Scanton, Pennsylvania, to New York City and an activist in Brooklyn, she fought against the so-called "urban renewal" of the 1960s; and she was largely successfully at least in forestalling what was really urban removal.   She advocated for old mixed-use buildings in diversified neighborhoods, which was the opposite of intentions from planners such as Robert Moses who intended large new single-use structures for uniform neighborhoods. 

Also, Jacobs was self-educated.  Working as a secretary and freelance reporter, she attended on her own Columbia University's open college or extension school (now the School of General Studies).  She studied what interested her, and at one point was almost forced into a degree program which she successfully resisted.

Her other books include: 

• The Death and Life of Great American Cities, New York: Random House, 1961.
• Cities and the Wealth of Nations, New York: Random House, 1984.
• Systems of Survival: A Dialogue on the Moral Foundations of Commerce and Politics, New York: Random House, 1992. 

 Her theories on the transition from the Neolithic to the Bronze Age were validated after the excavations at Çatal Höyük were resumed.  She suggested that the first commonly accepted trade commodity was not wheat - and certainly not useless silver or gold - but obsidian.  Obsidian for points (arrowheads; spear tips) was broadly desirable by hunters.  However,

CSI: FLINT 2011 - Who Guards the Guardians?

On May 6, I presented two classes to middle schoolers participating in "Super Science Friday" at the University of Michigan Flint campus. In all about 500 pupils attended two each of 25 different sessions.  Some were laboratory demonstrations, others were hands-on engagements.  Topics included website design, trauma response, the chemistry of cooking, music, and termites.  My session was titled "Who Guards the Guardians" and explained misconduct and fraud in science as it applies to junk science in the courtroom and misconduct in police laboratories. 

To support the discussion, I created a blog, here.

Reflections on Atlas Shrugged Part 1

I saw it the moment it opened, 12:10 PM, Friday, April 15. The work was credible. I found it impossible to imagine seeing the movie without having read the book. So, for me, it was a matter of my own visualizations versus their realizations.   Overall, the movie is everything I wanted and a bit less.  This is true, also, of  Pride and Prejudice or the Star Trek franchise.  Atlas Shrugged is primarily for fans.  

[Note: These comments are based on earlier posts to Rebirth of Reason and Objectivist Living discussion boards.  They are edited and amended for this presentation.]

The film has been compared to My Big Fat Greek Wedding which had near-zero traffic at first but which stayed in theaters for a year, building a following.  Atlas can go to dollar cinemas at the malls for months to come.  Producers of the 1939 Wizard of Oz were reluctant to take on a story that was not popular and which failed as a film in 1910.  I hope that we don't have to wait 30 years for the next attempt. 

I felt that Graham Beckel as Ellis Wyatt did the most credible job of projecting the character. Taylor Schilling delivered her lines well, but she has not deeply felt what it is like to grow up around trains, major in engineering, and all the rest. Her acting, like all of their acting, was competent acting. But Beckel really looked and felt like an oil man from Colorado  (In the book, Wyatt is a young genius, and Beckel is not young, but that is a quibble.)  Grant Bowler did not feel like a man who bought his first steel mill at 25, after being hungry on the streets at 12. The exchange of the bracelet could have been done closer to the book.  The ride along the John Galt Line could have been shot from the nose of the cab.   But it was not my movie to make.  I appreciate the work of those who did, the producers, director, and actors.  I was happy to see Armin Shimerman as Dr. Potter.  Shimerman played the Ferengi, Quark, on the Star Trek: Deep Space Nine series.  (Quark runs a bar; and the Ferengi are consumate traders.)  At a Trekker con, I asked him if he had read any Ayn Rand.  He said that he read The Fountainhead and would be revisiting Rand to add depth to his character.

On the Objectivist Living discussion board, Kat, on 15 April 2011 - 10:05 PM, said:The Owen Kellogg scene was almost comical because the guy was such a dweeb you would think Dagny would be firing him rather than giving him a promotion.

I replied:  I liked that. I understood it, to the core. In a rational world where people who are motivated by the ideas portrayed in Rand's work, who do you think would be in charge? Our world is a collectivist tribalist remnant which is only now discovering individualism. Even the LP convention organizes people alphabetically by state. Is that individualist thinking?  Dagny would see the brilliant mind. When she said that she was "grooming him for management" what do you think she meant? He just needs a couple of classes or seminars in public speaking and project management. It is in our world of the collectivist corporation and the altruist state that the Owen Kelloggs of the world do not find leadership within complex organizations.

The theme of "the mind on strike" is deeper as every social structure knows social loafing.  We call them "slackers" because when not pulling their own weight, it is their segment of the line that hangs loose. The demise of General Motors, Chrysler, and Bear Stearns was due as much to internal expropriation of talent and "sanction of the victim" operations as anything the government did -- after all, every firm suffers government intervention in some way, though, granted that software development is not the same as investment banking and heavy industry.  But, that, too, points to the deeper theme: common wage employees who see themselves as sole entrepreneurs offering their best effort for the the highest rewards were not welcome in the corporations that failed.  Long ago, they were attracted to other kinds of work, other employers, as other workers were drawn to the failing corporations for non-objective motives. 


Even though Atlas Shrugged is a philosophical detective story about the theft and recovery of genius, this is primarily a political movie, as many people read  Atlas as a political novel.  However, the book's three parts were named for metaphysical axioms.  Dialog and narrative integrate epistemology with ethics all through the book. 


Ultimately, while the conflict between government and business is obvious, deeper is the nature of those in any social context who carry the project on their shoulders despite the loafers.  ("Social loafing" is a known fact.  In economics it more formally labeled the "problem of the free rider" or defined by various "externalities."   The counter presentation is the "tragedy of the commons."  Tragic though it be, no one suggests doing away with the commons.)  That applies to the people within a corporation - or within a government agency: police and military face the problem of "goldbricks."  In the book,  it always comes back to metaphysics and epistemology.  The movie does not hinge on those conflicts.

It could.  In a different day, a different Atlas could be an explicitly philosophical movie, derived from metaphysics and epistemology, in which the political conflicts are seen as expressions of deeper motives.

 It could be told from the point of view of John, Frisco, and Ragnar at Patrick Henry University with Profs. Akston and Stadler and follow forward from there, peaking at the 20th Century Motors, bringing Galt to the Taggart Transcontinental, Ragnar at sea, and Frisco a playboy, ending with Dagny's decision to create The John Galt Line.  "Let him come and claim it," she says.  "He will," Francisco replies.  End Part I.  The central "action" would be arguments among the boys and Akston on the proper course of action, on their isolation from Stadler over the State Science Institute.  You might think that a movie cannot be carried by dialog, but what makes Pride and Prejudice, a perennial favorite?  It is the only movie I have watched three incarnations of -- and not a gun, bomb, or starship...

A psychological Atlas could portray the disintegration of James Taggart, from "Don't bother me!" to his realization at the State Science lab machine that he wants to die.  That would be the dark shadow that illuminates Hank Rearden's self-discovery -- a story that could play out in a laissez faire utopia.   Rearden's conflict is really within himself and reflected in his relations with his family, hallmarked by his wife.  The government was largely irrelevant there, but the theme was the same and the action followed the same path: he quit working for his family; he also quit working for the government.  And, as for the mind not working, his was not properly engaged on the problem of Dagny Taggart.  Until Francisco d'Anconia gave him a kick start, Rearden's thinking about romance was not actually thinking at all. 

If you search YouTube for fan-made Atlas Shrugged trailers, you will find several efforts.  This is one of the best by high schoolers:

We will see other complete productions of Atlas Shrugged, created with animation software that allows the director to choose from the full range of Hollywood greats.

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