Essay 41: Then and Now Thinking

Historical thinking is a lifelong attempt to link something called “then” to something called “now.”  History as an academic field of study has a deep cleavage within it in that people like Foucault and Nietzsche think the links between then and now are often illusionary since history is mostly noise (i.e., disconnected chaos) and not “signal” (i.e., “cause and effect” chains of linear progress uncovered by “historian-detectives.”)

We explore this in this mini-essay by looking at the rise of what we call a service economy.

The great Russian thinker Alexander Herzen is traveling around Europe in the 1840s with Marx’s Manifesto appearing in 1848.  Herzen is amazed at the service sector in Paris:

“He was enchanted by the conveniences of Paris, especially the numbers of quick efficient services, from catering to house-cleaning, which made it unnecessary to employ private servants.”

(quoted in Revolutions of 1848:  A Social History. Priscilla Robertson, Princeton 1967, page 110 footnote)

In our own day, the leading economic historian, R.M. Hartwell, in his classic essay, “The Service Revolution:  The Growth of Services in Modern Economy 1700-1914” outlines a worldwide rise of services, and concludes his essay thus:  “The lesson of history is undoubtedly, that was has already happened in the United States, will happen elsewhere, and that the trend in employment towards the services in all developed and developing economies will result finally in a world-wide service revolution.”

(The Fontana Economic History of Europe: The Industrial Revolution, Fontana/Collins, 1980, page 394)

Shall we then “fold Herzen/Paris 1848” into this larger picture, Hartwell’s 1700-1914 or is that a false linkage?

This is an example of then and now analysis which is key to education.

Let us continue the past two essays:

We then use this kind of interesting “home-made puzzle” (one we made-up ourselves and did not read anywhere) and follow it up by entering the academic subject:

  1. Read the classic Manias, Panics and Crashes, the Prof. Kindleberger (MIT) classic.
  2. Discover that the Prof. Niall Ferguson miniseries on PBS, The Ascent of Money, doesn’t elucidate our particular query.
  3. Read Kevin Phillips’s Bad Money to get an introduction to the dangers of “over financialization.” (“hyper financialization”).

The “New York Times” in a piece The New York Times, 12 November 1910, describes the bank run in England including the Westminster Bank.   The movie is set in 1910.

We then begin to think that the collapse of Barings Bank in recent years (Nick Leeson scandal) radiating out from Hong Kong office, is not disconnected from the Barings Bank scandals of 1890. Historical thinking wants to see an arc or trajectory or larger and wider process, and not as disconnected, episodic and completely random.

The Anglo-American financialization process has led to many anomalies.

You might legitimately date the modern beginnings of this mega-process from the 1873 classic by Walter Bagehot of The Economist in his book, Lombard Street, where London is described as the money machine that governs the world and its fluctuations.

Hank Paulson, U.S. Treasury Secretary and Ben Bernanke of the Fed, warned Congressmen in Washington, in September 2008, that the global financial system was on the brink of collapse and needed “infinite” bailout money by that Monday morning, after the weekend.

These problems have yet to be seriously addressed and we might be in a new “bubble” at the intersection of real estate and financial system pathologies (i.e., where the world economy tends to become a kind of “betting parlor”).

Essay 40: Movies as a “Backdoor Into Financial History”

“Financial history” (the Professor Niall Ferguson PBS miniseries, The Ascent of Money, of recent years tries to “flag” this domain) can be exciting and eye-opening if the student fins the kind of “backdoor” into it that makes it all enchanting and not a tiresome slog through opaque textbooks.  Movies are a good way to “parachute” into fields, domains, areas of study:

The 1963 movie Mary Poppins is partly about bank runs and the “Tuppence” song in the movie communicates the centrality of London finance in the world of 1910, the setting of the movie:

“You see, Michael, you’ll be part of railways through Africa
Dams across the Nile, fleets of ocean Greyhounds
Majestic, self-amortizing canals
Plantations of ripening tea
All from tuppence, prudently fruitfully, frugally invested
In the, to be specific
In the Dawes, Tomes, Mousely, Grubbs
Fidelity fiduciary bank

Now Michael, when you deposit tuppence in a bank account
Soon you’ll see
That it blooms into credit of a generous amount
Semiannually
And you’ll achieve that sense of stature
As your influence expands
To the high financial strata
That established credit, now commands
You can purchase first and second trust deeds
Think of the foreclosures
Bonds! Chattels! Dividends! Shares
Bankruptcies! Debtor sales! Opportunities
All manner of private enterprise
Shipyards! The mercantile
Collieries! Tanneries
Incorporations! Amalgamations! Banks”

The current  U.S. Treasury Secretary Mnuchin was a foreclosure king of the Great Recession of 2008.  An American movie on “bank runs” is of course the classic It’s a Wonderful Life (with James Stewart as the local banker.)

The 1910 world of London finance show in the movie Mary Poppins can be now contextualized by realizing all of this crashed down in August 1914 which represents the beginning of post-WW 1 “deglobalization.”  Thus, finance and globalization issues haunt the present.

Walter Bagehot’s masterpiece of 1873, Lombard Street, is a kind of anticipation of this syndrome and Charles Kindleberger‘s (MIT) Manias, Panics and Crashes gives the sense of the underlying instability.

Kevin Phillips’s book Bad Money of 2008 outlines the dangers of “over financialization.”

The movie and the fun song can help a student find his or her way in to these areas and domains.

Essay 39: Movies as a “Parachute” or Backdoor Into the Field of Economics

Here’s a second example of using movies to “sneak up on” a field such as economics.

Think of the movie, The Treasure of the Sierra Madre, from 1948, a Humphrey Bogart classic:

In 1925, in the Mexican oil-town of Tampico, Fred C. Dobbs (Humphrey Bogart) and Bob Curtin (Tim Holt), two unemployed American drifters, survive by bumming for spare change. They are recruited by an American labor contractor, Pat McCormick (Barton MacLane), as roughnecks to construct oil rigs for $8 a day.  When the project is completed, McCormick skips out without paying the men.

Returning to Tampico, the two vagrants encounter the grizzled prospector Howard (Walter Huston) in a flophouse. The loquacious and penniless ex-miner holds forth on the virtues of gold prospecting and the perils of striking it rich. The two younger men feel the lure of gold and contemplate its risks. Dobbs and Curtin run into McCormick at a cantina, and after a desperate bar fight, they collect their back wages in cash. When Dobbs wins a small jackpot in the lottery, he pools his funds with Curtin and Howard to finance a gold prospecting journey to the Mexican interior.

The flophouse mentioned above (“Oso negro”) has a quick scene which is a marvelous “parachute” into economics:  a group of men begin to reflect on why gold is so expensive while the basics of life like water or air are not.  Howard (their “cracker barrel philosopher-sage,” played by Walter Huston) explains that a thousand men set out to find gold.  999 of the men fail to find any, one finds some.  The price of gold has to reflect the costs of finding it (i.e., men, equipment, time, effort, opportunity costs, risks, danger, etc.) by all thousand and include the 999 failures and not just the one success.  This is an example, albeit primitive, of something like the labor-theory of value explored by Ricardo and then Marx:

Labor theory of value

The labor theory of value (LTV) is a heterodox theory of value that argues that the economic value of a good or service is determined by the total amount of “socially necessary labor” required to produce it. … Marx did not refer to his own theory of value as a “labor theory of value.”

Again, using this movie as a charming or enchanting “jumping off place,” you would begin to “dive into” those pages of the textbook that are relevant, much as you’d use a dictionary to look up some words. You then read towards the front and the back of the textbook, coming at it your own way, mindful of these questions of yours which begin to give the field a “shape.” You could do the “standard slog” through the textbook, none of which you remember three days after the course because nothing was based on your own “enchanted” searching and exploring.

Lastly, the author of the original 1927 novel, on which the movie is based, B. Traven was a German anarchist and he may have analyzed the world and its prices and costs (i.e., economics) like Howard in the movie.  This too is itself another “pathway” into economics, a biographical one.

Essay 38: Movies as a Backdoor Into Economics

We argue that one can only “parachute” in and out of a knowledge field by means of an “enchanting backdoor” and not by grim wrestling with a gigantic textbook alone. A textbook should be seen as a “dictionary” or reference book for a field and you dip into when needed as opposed to being oppressed by it.

Here’s a simple illustration of this:

There’s a classic British movie, The Stars Look Down from the forties starring Michael Redgrave. The movie tells the story of a poor boy from a Northern depressed coal-mining town who survives the downward drag of his bleak circumstances and winds up at a university based on his intelligence.

One scene in the movie shows him at a university debate where resources are a point of contention. He mentions the classic book by Jevons called The Coal Question (how much coal is there geologically and economically, given costs and prices). Jevons was a great 19th century mathematical economist. A would-be “parachutist” in economics reads this and then wonders how it might be applied to oil today factoring all costs, including ecological costs, costs of oil spills (i.e., the Exxon Valdez, etc.) and then looks up relevant pages if any in the textbook. This gives economics a context, a time, a place, a question, a “shape.” The student studies up on Jevons, say, using all this as a “backdoor” into both field and textbook.

William Stanley Jevons FRS (1835-1882) was an English economist and logician. Irving Fisher described Jevons’s book, A General Mathematical Theory of Political Economy (1862), as the start of the mathematical method in economics.

The Jevons Paradox

The Coal Question: An Inquiry Concerning the Progress of the Nation, and the Probable Exhaustion of Our Coal Mines is a book that economist William Stanley Jevons wrote in 1865 to explore the implications of Britain’s reliance on coal.

There’s more to be uncovered:

In the classic book on urban economics, Triumph of the City, by Glaeser of Harvard, the author says:

“The nineteenth-century English economist William Stanley Jevons noted that more-fuel efficient steam engines didn’t lead to less coal consumption. Better engines made energy use effectively less expensive, and helped move the world to an industrial era powered by coal. The term, Jevons paradox, has come to refer to any situation in which efficiency improvements lead to more, not less, consumption—one reason why fuel-efficient cars can end up consuming more gas. Jevons paradox applied to information processing means that as we acquire more efficient means of transmitting information, like e-mail or Skype, we spend more, not less, time in transmitting information.”

(Edward Glaeser, Triumph of the City, Penguin Books, 2011, page 37)

Adding more roads to a road system can add to the congestion one expected to relive by attracting even more cars, a Jevons-type phenomenon.

It’s only by “going off” on a direction originating from outside the field (from movies to classic names and analyses to traffic other “congestion” phenomena, can one then “charge up the hill” of a field like economics, where you start with a kind of sense of enchantment and harbor such questions as raised by the movie, The Stars Look Down.

One “sneaks up on” a field one’s own way and sooner or later goes beyond the field asking how does this kind of thinking relate to other parts of a university…enchantment and more holism carry the student forward. Without these “twin engines,”” one is being processed by the grim “the knowledge factory” as opposed to becoming a processor and not just a processee.

Essay 37: The Language Phenomenon in Education

Wittgenstein (1889–1951) identifies language as the principal “confusion-machine” within philosophy:

“Philosophy is a battle against the bewitchment of our intelligence by means of language.”

The philosopher’s treatment of a question is like the treatment of an illness.

“What is your aim in philosophy?—To show the fly the way out of the fly-bottle.”

Education if deep and meaningful would put language itself in front of a student to understand the “bewitchment” and to perhaps “escape from the fly-bottle.” The fly-bottle is roughly “the captive mind syndrome” described by Czesław Miłosz, the Polish poet-thinker.

There are various aspects of this language-watching:

Hans-Georg Gadamer (Heidegger’s successor, who died in 2002) writes:

“It is not that scientific methods are mistaken, but ‘this does not mean that people would be able to solve the problems that face us, peaceful coexistence of peoples and the preservation of the balance of nature, with science as such. It is obvious that not mathematics but the linguistic nature of people is the basis of civilization.’”

(German Philosophy, Oxford University Press, 2000, pages 122/123)

This is readily seeable. Imagine Einstein and Kurt Gödel walking near the Princeton campus. They speak to each other in German, their native tongue which they both “inhabit.” Gödel communicates the limits to logic and Einstein the limits to modern physics such as quantum mechanics. They bring in Bohr and Heisenberg and the “Copenhagen Interpretation” as a counter-view. They refer to equations and experiments and conjectures and puzzles, current papers and conferences.

They take “communicative action” by use of speech using German as a means.

There are two levels here that are always confused: the ontological (i.e., all the why-questions people ask using language) and the ontic level, all the how-questions people pose using mathematics and laboratory results (e.g., Higgs boson).

Gödel once made the observation that if you look at language as a kind of logical system, it’s absolutely puzzling that people can communicate at all since language is so utterly ambiguous and “polyvalent.”

Take the sentence: “Men now count.” Out of context, does it mean count as in the sense of numeracy, one, two, three apples in front of me or do you mean perhaps that men in a certain country were given the right to vote and now “count” politically. Without the context and the ability to contextualize, no sentence by itself makes certain sense at all.

This is partly why Wittgenstein sees philosophy problems as “language games.”

Heidegger coming from “being-in-the-world” as foundational, and calls language “the house of being.”

You inhabit a native language the way you “inhabit” a family home or a home town. You flow through.

When a child of ten plays marbles (as analyzed by Piaget) and his native language (say French) comes pouring out of him in a spontaneous gusher, how can we really explain it since the child doesn’t look up syntactical rules and grammatical definitions when he speaks. The words flow.

Heidegger retorts that language speaks you in other words, you’re channeling the language in a way a songwriter explains how a song comes to him. In the end, it’s something spontaneous and not propositional like grammar is.

A moment’s reflection shows you how “slippery” language is: 

A man driving to New York says to you, “the car died on me halfway there.”  He does not mean the car was “on” him physically. To die on doesn’t really mean perish forever, it means, on average, stopped to function in a way that usually can be fixed in the garage.  It means this reparable conking out of the car gave him a big headache and aggravation as he waited for the Triple A people to get there and do the paperwork. You visualize all these layers and twists.

Again, without a human context, the sentence “the car died on me” makes little sense. Without a human context, “the sky is blue” makes incomplete sense too. Does a camel or cricket see a blue sky?

A full education would explore these dimensions of language and this has nothing to do with bringing back Latin or Greek or studying a foreign language to meet a Ph.D. requirement.  Formal linguistics à la Chomsky, Fodor, Katz, etc. is not what’s being discussed, as interesting as all that might be.

It also is not about language genes such as FAP-2 or how vocal cords work since these questions are ontic (i.e., how does it work?) and not ontological (i.e., what does something mean or imply?). Thinking about language in an engineering sense with the human mouth as a “buccal cavity” is quite legitimate and a voice coach might do well to do that.  We are talking about something else:  the centrality of language in human self-understanding, functioning and the making of meaning.

Essay 36: What We Mean by “Epochal Waters”

We sometimes use the phrase “epochal waters” to refer to the deepest layers of the past which we “swimmers” at the surface of the ocean don’t see or know. “Epochal waters” are latent, currents are closer to the surface.

There’s a similar idea from the French philosopher Michel Foucault who died in 1984. In his The Order of Things, classic from 1966, he talks about the “episteme” (as in epistemology) that frames everything from deep down. (The Greeks distinguished between “techne” (arts, crafts, practical skills and “episteme” (theory, overview).

“In essence, Les mots et les choses (Foucault’s The Order of Things) maintains that every period is characterized by an underground configuration that delineates its culture, a grid of knowledge making possible every scientific discourse, every production of statements. Foucault designates this historical a priori as an episteme, deeply basic to defining and limiting what any period can—or cannot—think.

Each science develops within the framework of an episteme, and therefore is linked in part with other sciences contemporary with it.

(Didier Eribon, Michel Foucault, Harvard University Press,  1991, page 158)

Take a simple example. A discussion comes up about what man is or does or thinks or knows. In today’s episteme or pre-definition, one thinks immediately not of man in terms of language or the invention of gods, but in terms of computational genomics, big data, bipedalism (walking upright on two legs). Its assumed in advance via an invisible episteme, that science and technology. physics, genetics, big data, chemistry and biology hold the answer and the rest is sort of outdated. This feeling is automatic and reflexive like breathing and might be called “mental breathing.”

One’s thoughts are immediately sent in certain directions or grooves, a process  that is automatic and more like a “mental reflex” than a freely chosen “analytical frame.” The thinker has been “trained” in advance and the episteme pre-decides what is thinkable and what is not.

There are deep episteme that underlie all analyses: for example, in the Anglo-American tradition of looking at things, the phrase “human nature” inevitably comes in as a deus ex machina (i.e., sudden way of clinching an argument, the “magic factor” that has been there all along). If you ask why are you suddenly “importing” the concept of “human nature,” the person who uses the phrase has no idea. It’s in the “epochal water” or Foucault’s episteme, and it suddenly swims up from below at the sea floor.

Another quick example: In the Anglo-American mind, there’s a belief from “way down and far away” that failure in life is mostly about individual behavior (laziness, alcoholism, etc.) and personal “stances” while “circum-stances” are an excuse. This way of sequencing acceptable explanations is deeply pre-established in a way that is itself hard to explain. It serves to “frame the picture” in advance. These are all “epochal water“ or episteme phenomena.

Essay 35: Education and the Need for Enchantment

Max Weber (1864-1920) and Émile Durkheim (1858-1917) are considered the two fathers of modern sociology at the highest level.

Weber sees the modern world as the zone of “Ent-zauber-ung:” where ent means removal of, Zauber means magic or enchantment and ung means the process of.

He sees our world as “dis-enchanted.” Everything is scientific or profitable or unwelcome. This makes modern life a productive engine of sorts but extremely desiccated and arid and leads to what Durkheim calls “anomie” (the sense of being adrift, directionless).

We argue in this book that education should be seen as the “last exit” to enchantment before the “grind of life” comes down on the student after the “moratorium” of college.

What is enchantment? Enchantment is that special feeling about something, some topic, field, math problem, painting exhibit, novel, movie, debate, that there’s something there that “makes it all worthwhile” and like a great piece of music, “gets to you” and flies under all cynical radar. The best kind of enchantment can last from age 19-95, if you live that long.

Think of a math or physics problem or novel or painting that gives the student “permanent uplift.”

The pedagogical dimension of enchantment works like this: the student encounters a puzzle or conjecture or story or depiction that constitutes a “healthy obsession.”

After interaction with this phenomenon, he or she can “walk backwards” to the 900-page textbook and go to those pages that are relevant, this making the textbook more like a dictionary that serves as a handy reference book and not as a daunting, exhausting endless “Mt. Everest” of names and equations or faces or dates. The student can “conquer” textbooks by enchantment and only enchantment. Without that engine or motor for the mind and will, one is weighed down and demoralized in advance.

Let’s do two quick examples:

Heraclitus is supposed to have said, “you can’t step into the same river twice.” Zeno says you can’t really cross the street because first you have to reach the midpoint, then the next midnight, and so on forever. You never complete your crossing (see Joseph Mazur’s book, Zeno’s Paradox, from 2008).

Such ancient paradoxes are still perplexing. Great thinkers like Bertrand Russell, Whitehead, Frege, et al wrestled with them many decades.

It’s also puzzling that certain math or logic questions open up “oceans” of analysis. Why might that be? Is that enchanting or depressing?

The last chapter of Tolstoy’s War and Peace masterpiece is a set of reflections on history itself. It’s very enchanting as he wrestles with this “caprice machine” called history.

Enchantment gives you the first steps towards what we call “pre-understanding,” a prerequisite for all deep study.

Essay 34: Arguments Without End: Are They Good or Bad?

The Dutch historian Pieter Geyl (died in 1966) coined the phrase “argument without end” to get at the constant reappearance of old arguments or viewpoints. One gets the impression that arguments are either persistent or perhaps permanent. One simplistic example could be argument about socialism: Sweden is “good,” but Venezuela (or Cuba) is bad. This book takes the view that “arguments without end” are not the end of knowledge but rather a potential beginning: it could be that some issues cannot be captured by one school of thought: the awarding of the 1974 Nobel Prize to both Hayek (“the right”) and Myrdal (“the left”) is an example of this need for hybridity. Both Hayek and Myrdal are each seeing something valid and it’s a “fool’s errand” to decide who is “eternally” correct.

Let’s apply this thinking to a deep “argument without end” within and about history.

Michel Foucault (died in 1984) following Nietzsche, argues that history seems “linear” but is more random and non-linear than the “linear” historians see or admit.

There’s an aphorism in Nietzsche, (from his The Dawn) which Foucault uses…history is made by the “iron-hand of necessity shaking the dice-box of chance.”

In other words the world we know, traveling somehow from the assassination of Kennedy (November 2, 1963) to the impeachment hearings of Trump in October 2019, must be thought of as a kind of “random walk” behind which are trends, cycles, so that one gets a fusion of structure and surprise. If you emphasize surprise you’re closer to Foucault than to those narrative historians who think they can show you the exact threads which connect “then and now.”

Here’s an example of such a historian, the celebrated G.R. Elton of England, whose classic The Tudor Revolution in Government is a masterpiece of orthodox analysis. The book centers on the administrative revolution in the 1530s in England which implied, says Elton, “As regards political and social structure, the sixteenth century produced something quite new in England—the self-contained sovereign state in which no power on earth could challenge the supremacy of statute made by the crown in parliament.”

“In this revolution, in this making of a new kind of state productive of a new kind of society, administrative reforms played their part. It is against this background of controlled upheaval that they must be seen and understood.”

(Elton, The Tudor Revolution in Government, Cambridge University press, 1966, page 426/427)

Orthodox historians see history as a “nail-down-able” system of storylines and the controlled upheavals have a direction (teleology) which allows you to use—in this case the 1530s in England—as a beginning, an origin, a “datum line,” and once you have this clear starting point you can follow the story to now and include comparative developments in France or Germany or China.

The orthodox “explain strategy” starts with an origin, a “starting gate” like a horse-race.

The Foucault–Nietzsche view is that these starting points are not entirely useless but in the end don’t help you because history is in the end governed by “the dice-box of chance” even if it is held by “the iron-hand of necessity.” History is more “upheaval” than “control” more surprise than structure. “Determinism” such as perhaps based by pinning down a starting point from which one can “build out,” is a wish-dream since history is nonlinear and nondeterministic. Even Elton’s phrase “controlled upheaval” is full of questions and problems.

Modern “complexity theory” in mathematics tries to get at these differences analytically. A “meta-intelligent” student would go from this historians’ “argument without end” to the analysis of complexity in math as a way of rounding out the exploration.

An “argument without end” can thus be useful if the student does not insist on some final “apodictic” or certain-forever answer.

Essay 33: How to Jump From a Field to a Larger Understanding: The Example of Globalization

In a university, one is trained to “inspect” fields. That produces what might be called a “monographic” intelligence.

Our purpose is to show and promote something ancillary to this, what might be called a “circum-spective” intelligence (i.e., using the specialized knowledge as one “brick” in a larger structure of understanding).

Let’s do an example:

Think of all the descriptions and analyses of something called globalization. An objective evaluation of the literature on this show two analyses that stand out and tower above the rest:

  1. Prof. Jeffrey Williamson and Kevin O’Rourke, Globalization and History, MIT, 1999 (this is a “quantitative history” or “cliometric” study and a classic).
  2. Elhanan Helpman, Understanding Global Trade, Harvard, 2011 (a masterpiece of trade-based analysis)

Both of these authors are Harvard professors in economics and deserve the high regard that such books have won them. In these two books, there are several technical disagreements of which the deepest is that Williamson focuses on the emergence of one world market price (say for wheat) and argues that this “price convergence” is the best measure of globalization. Thus at a certain point wheat of a certain kind (hard, durum, etc.) was price at the same world rate whether the wheat came from Kansas, Canada, Argentina or Ukraine. The world is then a global price-making market mechanism. This price convergence then extends to their kinds of prices as globalization processes deepen. Williamson explicitly considers other approaches to globalization such as trade share of GDP as confusing.

Helpman, on the other hand, uses export plus imports/over GDP as his measure, clearly disagreeing with the Williamson approach of prices and not trade shares.

Interestingly, both scholars conclude that something we call globalization begins to “show up in the data” in the 1820s. Thus, Marco Polo-type stories are colorful and “multinational” but have little to do with actual (i.e., data based) globalization as we see it, looking backwards from 2020.

Both of these books are classic works and show the intricacies and utility of the “cliometric” approach (i.e., explaining the past quantitatively, using data from economics).

However, there’s a deep perspectival omission in both works:

As the novels of Balzac (1799-1850) show there begins to “co-evolve” with this globalization story a parallel story of global colonization and empire-building by the European powers. Algeria is seized in 1830 and culminates in the brutal Algerian War of 1954-1962. Without de Gaulle‘s supreme prestige as the savior of France, the French would have gone to a destructive civil war and the defeat in French Indochina at Dien Ben Phu. 1954 almost lead to endless strife based on events on the other side of the world.  Balzac’s novels are often set in the 1820s and mention a deepening involvement of France with North African empire-building.

This culminates in Maupassant’s novel Bel-Ami from 1885, which centers on the inexorable rise of an unethical “manipulation machine,” who returns from North Africa as a penniless soldier and after many twists and turns makes several killings in North Africa in various shady schemes which he gets wind off via his journalism contacts.  In other words, the rise of Western industrial technology (from railroads to cars to planes) conquers the world one way while the European colonial armies conquer the world another way.

The peoples like the Vietnamese and Algerians “see” the world in colonial terms with colonialism backstopped by industrial technology. Their quest for dignity begins with this analysis and not with the analysis which says industry and science are primary and colonialism a footnote.

It is this fundamental clash of historical interpretations on a worldwide scale which bedevils the changing relationship between the West and the non-West and is more profound than the econometric differences between a Prof. Williamson and a Professor Helpman.

By seeing how these layers and stories are “entwined” gives you a deeper and wide-angle vision which one field—economics or cliometrics—can’t offer because it is one brick or building block in a larger story. Fields have to be “opened up” in this way, which is the mission of this book.

Essay 32: Movies Novels and Songs as an “Open University”

This essay is a continuation of the previous one and will show you how a novel gives you a backdoor or side window into education.

The novel Howards End (1910) by E.M. Forster has two foci that it orbits, in a kind of ellipse, like a planet. One focus is social mores of different strata of society, the buccaneering money families (Wilcoxes), the artistic and culture (based on inheritances such as the Schlegels) and the “people of the abyss,” the marginal insurance clerk Leonard Bast. The other focus is money and wealth.

Henry Wilcox warns the Schlegel sisters (Margaret and Helen) that the insurance company, the Porphyrion Fire insurance Company their new friend (the poor clerk Leonard Bast) works for might go bankrupt or “smash” in British lingo:

“The Porphyrion’s a bad, bad concern.—Now don’t say I said so. It’s outside the Tariff Ring.”

“I thought an insurance company never smashed,” was Helen’s contribution. “Don’t the others always run in and save them?”

“You’re thinking of re-insurance,” said Mr. Wilcox mildly. “It is exactly there that the Porphyrion is weak. It has tried to undercut, has been badly hit by a long series  of small fires, and it hasn’t been able to reinsure. I’m afraid that public companies don’t save one another for love.”

This advice turns out to be fear-mongering and Leonard Bast quits his job at the Porphyrion and can’t find new work and is desperate since he’s part of the ‘people of the abyss.’”

Later on Henry Wilcox (Anthony Hopkins in the film) reverse himself and says that now the Porphyrion is ‘safe as houses.’”

The Tariff Ring referred to above has nothing to do with the tariffs we think of in 2020, duties on Chinese or Canadian or European goods.

The Tariff Ring refers to a consortium of insurance companies which agree not to undersell each other. You can think of this as price-fixing if you like or perhaps as price-stabilization whereby the insurance companies are creating “reinsurance” by these means of dealing with one another in this block or consortium.

The Tariff refers to the price of the policy, the rate, the premium, to carry the insurance. The word tariff has several meanings and one must not confuse these tariffs (cost of insurance policy for the insured) with import duties, whether for protectionist or revenue motives.

A current leading global practitioner of modern reinsurance is Munich RE. You should go to their website and use this essay as a way to link to this whole world of insurance and reinsurance.

This shows you how a novel or movie serves as an “open university” if you get into this flexibly “circum-spective” frame of mind (i.e., real and deep learning without “silos”).