BBC NEWS | Business | US takes over key mortgage firms

BBC NEWS Business US takes over key mortgage firms:

"US financial officials have outlined plans for the government
to take over the failing mortgage giants Freddie Mac and Fannie Mae. The two companies account for nearly half of the outstanding mortgages in the US, and have lost billions of dollars during the US housing crash. The most recent figures show about 9% of US homeowners were behind on their payments or faced repossession. The federal takeover is one of the largest bail-outs in US history. It is intended to keep the two companies afloat, amid fears that either could go bankrupt as borrowers default on their home loans. Together, Freddie Mac and Fannie Mae own or guarantee about $5.3 trillion (£3 trillion) of mortgages. Banks around the world are
highly exposed to the two companies and therefore, given the febrile state of markets across the world, it had become dangerous for doubts to persist about whether they were viable and would be able to keep up the payments on their massive liabilities, says the BBC's business editor Robert Peston. A rescue plan passed by Congress in July gave the US government the authority to offer unlimited liquidity to the two companies, and to buy their shares, in order to keep them afloat."

I suppose this was coming for a while. Greed without order eventually collapses on itself. But the problem with the greedy is that self-ordering is particularly hard. I've felt for quite some time that Plato's analysis of oligarchy hits the nail on the head. It might have been an analysis of an abstract situation derived from contemporary Athenian political problems, but there is something about it which captures current social and economic problems quite well. Setting aside Plato's definition of justice, he was quite right to elucidate the psychological dissonance between the oligarchic mentality and the extra-monetary necessities of stable political order. Most pertinent for the current crisis is his analysis of usury. Blinded by their desire for more money, oligarchs will lend with great interest even to those that cannot pay. The exceptional defaulting debtor can be dealt with, but what happens when these debts become systematic? In Plato's judgment an underclass of good-for-nothing 'drones' arise as a result of the oligarchs’ collective blindness. Filled with resentment and, eventually, realizing the relative physical impotence of the oligarchs, these ‘drones’ revolt. The result is considerably worse political order - enter democracy.

Between our commitment to political values, and the negative revolution unwittingly induced by Plato's oligarchs, his story and our contemporary financial situation probably part company at this point. After all, the US government is stepping in to prevent financial collapse, rather than ignoring an impending doom. And anyway, revolutions are complex events that depend on a convergence of different historical factors. Plato's account is too simplified after all.

Perhaps this guarded confidence is right, but it would be wise to bear in mind a few salient conditions of an actual, historical, complex revolution - 1789. Like the US today, France was powerful but had accumulated enormous, unsustainable debts thanks to a bellicose foreign wars with an upstart, modernizing neighbor. French subjects were suffering from inflating food prices. The French poor were resentful of extravagant displays of wealth, taxes were injurious, and monetary finance was at the breaking point. Particularly in regard to the social egregiousness of inequality and luxurious display, Rousseau had pointed toward the fate of political and social collapse 34 years earlier in his Discourse on the Origins of Inequality.

Of course the US situation is markedly different. The US differs in that it has a nominal democracy which allows all citizens a periodic say in who shall rule them, inflation is not currently causing starvation, and there is currently no sign of famine. Nevertheless, homelessness is rapidly increasing, bankruptcy amongst private individuals and financial institutions is interconnected and worrisomely prevalent, and commodity prices – oil, natural gas, food - are interrelated, relatively high and likely to increase. The necessities of our day to day life are threatened. Nonetheless, I don't think these problems will pan out in terms of revolution, though significant social upheaval is likely more probable. My point: not only is the story above indicative of spectacular financial failure in America, the government bail out might offer no silver lining.

This is where Plato comes in again. The cause of the problems America faces (and a number of those France faced in the 18th century) is artificial and frequently lies in the blindness of greed. In Plato’s constitutional cycle the oligarchs are so blinded, but the democrats had a very different impediment. What happens though if the oligarchic mentality becomes paradigmatic? Although not exclusively so, our political judgments regularly boil down to estimations of cost and profit. There are important exceptions. Some judge political actions according to various rights frameworks, others according just distributions, others according to religious commitments. Some of these modes of political judgment are more common than others. Still, I think it likely that many and perhaps most Americans construe many and perhaps most political questions in terms of their economic impact.

Although this mode of decision making seems narrow, in some sense it also seems quite rational. Judging policies in terms of their capacity to make or save money, or to distribute funds to the most profitable aims might be far too common, failing to value other important goods like justice, fairness, equality or freedom, but this is not necessarily a sign of unmitigated greed. I need not have an inordinate desire for wealth just because I think economic value is the most important aspect of politics. In fact, money provides a flexible social good that we can employ for various, more particular goods, which we really want. If we are like the wise household manager of Aristotle's Politics then that is precisely how we would think about money, a means to an end. Money would not, consequently, be our ultimate concern. But I do not think the situation is so simple.

Plato and Aristotle both clearly identify the human tendency to conflate the instrumental value of money with final or real value. We easily take money to be not only the measure but the substance of our good. So long as I take wealth to be an instrumental good, I can make judgments about money that are quite rational (even if profit maximization is an intermediary goal). But if I take wealth to be my primary aim, or I begin to conceive of all political questions in terms of their profitability, then it is not difficult to imagine wealth becoming an object of ardor and desire. This is particularly likely in a society in which wealth and its trappings deliver prestige. But then disentangling means from end becomes particularly tricky. Upon this categorical change in my desires, controlled, rational judgments about costs and risks will be invariably foiled by the fleeting promise of profit. The problem is not that judgments of profitability are irrational but that the mentality behind the predominance of such judgments might very well be. This makes those very judgments only superficially rational. Thus, the oligarchical paradigm of political judgment I have in mind is not at all like rational choice.

For the Platonic Oligarch, this desire becomes his sole psychological feature. He is nothing but greed personified. This is unlikely to represent any actual human being, even one particularly devoted to profit, but it doesn't have too. As a way of interpreting the problems of a particular sociological characteristic, it is the preponderance of greed that matters. Even if I am greedy, but not all of the time, the majority of my behaviors will be like a Platonic oligarch. Even when I grasp the risks, my desires will get the better of me. Now if this preponderance is systematic in society (or in a particular social class) the injurious results of that individual preponderance stand to be compounded. Just as a frictionless surface is unlike an actual surface and the kinematic calculations true for frictionless objects are useful only for approximating the movements of real objects, Plato's oligarch and his oligarchic constitution provide useful heuristic devices.

Now my worry is that it is precisely because economic and utilitarian measurements are paradigmatic in this approximate way (not amongst political theorists) that the reflectivity needed to address current financial crises may be effectively unavailable.

This returns me to the news story. If I am right in accepting Plato's line that oligarchs tend to be single-minded in their love of wealth, I rightly identify our (the US) government as oligarchic (I don't mean the Bush administration, I am thinking more fundamentally) irregardless of the increasingly fictitious appropriation of the term democracy (the US may once have been a republic but the national government has never been constituted in a democratic manner, representative election being a classical means of aristocratic selection), and I correctly take this preponderant mentality to be shared by both governors and governed, then it makes sense to be less than sanguine about the US takeover of Fanny and Freddie. Perhaps, I am wrong, and the government will step in, spontaneously develop ingenuity, and rectify a precipitous situation; but I think it more likely that the blind are following the blind.

And even if this proves to be an astute financial decision, I remain unhappy about the centrality of economic goals in contemporary politics. It would be useful to have a broader perspective about just what politics is valued for (or whether, with the Greeks, political practice is a humanizing value itself). But if I'm right about about the predominance of an oligarchic mentality, then that broader perspective promises to be elusive. I do hope, however, my despondence is proved wrong.

Once more into the breach,

Ben

Fénelon

I'm looking at Fénelon again for my first chapter on Rousseau. This is mainly just getting previous work I had done on Rousseau's intellectual context into neater shape, and pitching this in terms of the Fénelonian currents of intellectual discourse in Rousseau's formative and active years. With Rousseau's reading of Fénelon and other neo-Platonic, and Cartesian philosophers in place probably before he read Plato, the intellectual framework of his particular apprehensions of Platonic views becomes considerably more interesting than has been suggested in current scholarship. And because Rousseau read Locke at about the same time as he read these neo-Platonistsand and because his instincts toward these varied doctrines were immediately syncretic, the fusion I suggest between Lockean ideationalism, Rousseau's account of passions, and neo-Platonic sublimated Eros is made quite plausable indeed.



In the meantime, I thought I might include a picture of the pious Archbishop of Cambrai.

(Image taken from Web Gallery of Art [http://www.wga.hu/frames-e.html?/html/v/vivien/fenelon.html] for editorial purposes only.)

Also on paintings, I was quite struck by Lucas Cranach's 'Close of the Silver Age' when I visited the National Gallery with Ahreum earlier this week.

(Edit: The link is dead. It is actually far better to look at the painting on the National Gallery's website: http://www.nationalgallery.org.uk/paintings/lucas-cranach-the-elder-the-close-of-the-silver-age. They have a programme which allows very precise viewing. Facial details in the painting are expectional. While one misses the texture of the paints and brush strokes, this web viewer may be than seeing the picture at the gallery, particularly because the lighting there tends to produce a good deal of glare on the painting. August 1, 2009)

If I were writing a book on Rousseau's Second Discourse...

Once more into the breach,

Ben

Riding a bicycle backwards and then forwards

Everyone's had that dream where they are on a bicycle, heading to some important event, fleeing some tragic fate, or otherwise riding for some gripping cause.  In the phantasmagoric world one's forward journey becomes increasingly sluggish.  Then, quite suddenly, frantic peddling is met only with retrograde motion.

 

I also have a similar dream which is draws on my time at the University of Wisconsin-Madison lakeshore dorms.  Particularly the Bradley Learning Community (BLC, also known as the Bradley Liquor Cabinet) and to a lesser extent Tripp Hall.  In the waking world of my first year I had a rather uncomfortable pair of dodgy leather shoes which quickly blistered my feet.  When those blisters got ones of their own, I upgraded my footwear.  Most of the time I walked from the BLC to the Humanities building via the Lakeshore path, which is unpaved gravel.  At the time, the route took me about twenty minutes, and before and for sometime after I replaced the shoes, caused my feet considerable anguish.

 

In slumber-land, I also walk from the lakeshore dorms to lectures and tutorials via the lakeshore path.  I'm rushing to make it on time.  The pain of the blisters remains, perhaps amplified but also disembodied, memory like.  But the cause is different - this time I'm barefoot.

 

Now these dreams might suggest that I am about to engage in some inane, pseudo-Freudian, quasi-psychological analysis of my subconscious.  I am not. 

 

Instead, today I feel a particular kinship with this disembodied sleeping self.  The cause of my consternation is a chapter on Rousseau's neo-Platonic debts.  I had finished this chapter, save for a few loose ends, or so I thought. 

 

Upon further review several substantive sections need serious reworking, and I've changed part of the analytical framework for a third.  I also have to incorporate or point toward the fusion between Lockean ideational thought, and Platonic sublimated Eros.  I had not argued for this synthesis when I drafted the chapter in my second year.  All this adds up to more revision than I expected.  The good news is the chapter will have a more interesting thesis than in its previous incarnation and will fit cheek and jowl with the next.

 

Once more into the breach,

 

Ben

Pictures from Oxford

Just sharing a few pictures from Teddy Hall, and other places in Oxford that will be occupying my view in the upcoming months.

Radcliffe Camera (undergraduate reading rooms in the Bodleian) and the University Church of St. Mary

The most important part of the Bodleian

Entrance to the Bodleian

Radcliffe Camera

Teddy Hall, I had my interview in this building

More Teddy Hall

St Edmund Hall has converted a disused parish church into the college library, and the grounds into a series of gardens. You can even walk on the grass in some of them.

So this is where I'll be working over the next year. I'm really quite impressed by the physical space.

Of course I'm most excited about having an extended period of time to work with Locke's manuscripts. Many of these have now been published, so the exclusivity of access to his drafts is less pronounced than it was twenty or thirty years ago. Still, there is something quite striking about holding papers which record the exertions of a great mind. The hesitancy, immediacy, and intimacy of such experiences are profoundly moving.

Patrick Riley, my undergraduate lecturer, reflected on his use of manuscripts in, recalling from memory, his The General Will Before Rousseau. His experience with manuscripts left him convinced that authors lived on in them; dead philosophers were only deceased in the most trivial of senses. There is something profoundly Socratic in that sentiment, and one which I frequently share.

This however is a photo post, so I will hold off on more extended musings on drafts, journals, and other manuscripts. Perhaps, that will make a good future entry.

Once more into the breach,

Ben

AHRC Research Leave Scheme. In Peril?

Via the The Brooks Blog (and via Brian Leiter):

http://www.timeshighereducation.co.uk/story.asp?sectioncode=26&storycode=403020&c=1

http://the-brooks-blog.blogspot.com/2008/07/uk-research-leave-scheme-for.html

http://leiterreports.typepad.com/blog/2008/07/more-trouble-fo.html

By the sound of things the Arts and Humanities Research Council scheme for research leave may be changing. Although both Thom Brooks and Brian Leiter include headlines that sound like research leave funding might be axed altogether (this seems like a possible, but worst case, scenario), it seems fairly evident that the AHRC wants to address several problems with the current schemes. These would probably require the current scheme to be reworked or replaced, but not dropped without a successor. The issues are whether the scheme lead to completed research projects, whether it aids junior academic sufficiently, and whether it promotes collaborative research adequately? Of the three, that collaborative research is being presented as the biggest priority.

If collaborative funding is the driving force behind changes which eventually emerge from the AHRC, some dire portents might be justified. Presumably, the money currently lined up for individual scholars would have to be obtained from joint research proposals. This entails significant procedural changes, and may also entail significantly different probabilities of success, depending on how funding is eventually earmarked. I am not at all sure that this is healthy.

Collaborative research may be a desirable norm in some fields, but I wonder if it is appropriate to all kinds of research. As a matter of fact, I have enjoyed and continue to look forward to collaborative work in the history of political thought. That said, the joint papers I have given were both received in conferences as stimulating novelties. More importantly, I cannot conceive of having achieved my work on Lockean will and on Lockean language collaboratively.

Of course, one can always try to sell one's work as collaborative, even if that is true only in a thin kind of way. One might imagine a loose research group dedicated to a common theme, perhaps agonism in republican thought. By presenting work, in a series of seminars and hosting several conferences, some edited book or special issue of a journal might be pursued at the close of the research group. There is no reason not to think of this project as collaborative. The question would be whether this kind of thin collaboration satisfies, or whether the AHRC will be looking for something more like joint research. If thick collaboration is the goal, the accommodating research programme like that imagined here would probably not have the cohesiveness to command success.

At the moment, its probably to early to jump to conclusions, but the ramifications of potential changes, if currently indeterminate, could be staggering for how research is carried out and where.

Once more into the breach,

Ben

Flat Hunting

I've just been to Oxford to search for housing for the upcoming academic year. Teddy Hall put me up and gave me breakfast while I was there, which made the process much more comfortable.

 

I visited a few closets purported to be studio flats. One of them was owned by a real eccentric, blue blooded Briton of the upper class. Upon learning that I was from Wisconsin, she promptly mentioned that her brother owned a farm in Spring Green (the location of a Shakespeare company of regional fame, and a very nice part of the state). It soon turned out that this one farm was actually a portfolio of agricultural properties in Wisconsin, Illinois, Canada, and most recently in China. She then asked if I lived in a log cabin, (as all woodland Wisconsinites do) or whether I had every participating in building one. In the process she noted that the technique of cabin building required the use of a 'ghastly' substance to block the draft between the logs. Charming though this encounter was, I was not convinced by the dollhouse like proportions of the flat and pressed on.

 

This was a fortuitous decision because the next place I looked at, while not a self-contained flat, was a room large to accommodate the previous flat altogether. It had nice high ceilings, was airy, and included the use of a fairly well proportioned kitchen and washing/utility room. The other flatmates were said to be professionals and a graduate student. Plus the place was downtown, close to the railway station, and about a seven minute walk to my college. Not having to spend money on public transport, and having access to my office whenever I want is certainly worth the opportunity cost. So I made the move to secure the flat.

 

At the moment the estate agent (real estate agent for American readers or Maakelaar for the Dutch) is checking my references. When that is complete I will pay my deposit and the first months rent. Hopefully, this goes smoothly. My contract will start on 1 September, and matches my employment term date for date. This gives me to the chance to use Oxford's Bodleian library sooner rather than later, and that is an opportunity which cannot be missed.

 

A few photos of Teddy hall will be forthcoming in my next post.

 

Once more into the breach,

 

Ben

Cafe Espresso

I just want to give some credit to a lovely little cafe in Exeter, situated on the way up to the Rougemont Castle. I'll add some pictures when I remember to take a camera there, but it is has been the home of serious studying, writing, revising, and marking since I have been in Exeter. I was working there today, and thought about the many qualities of the operation. The barista’s are friendly and make a very fine espresso, and the chef concocts some fantastic cakes. And that is a compliment coming from someone who is rather obsessed with cake and pastry baking. The physical space incorporates two different idioms, with the upper floor clad in rich yellowy creams and overlooking the Rougemont Castle's surviving Norman tower, providing an atmosphere entirely unlike that in any chain cafe.

 

One barista trained in Australia, which might seem like a rather unusual place to learn the ropes of espresso. But with all seriousness, his work really surpasses much of what I have had in Italy (Florence, Bologna, Pisa, and Milan). I mentioned this to him, and he explained the cafe scene in Australia. Apparently the Aussies are quite particular when it comes to coffee. If they don't like a drink they will send it back. This is a regular, frustrating, and I can imagine a little bit humiliating experience. So he said he learned how to make coffee in short order. He used to work at Costa when they were an up and coming chain, and 'serious about coffee', but gave up on them when they started to really accomplish their sales goals and care less about the quality of their product. He's been at Cafe Espresso since then, and in my judgment is a real asset.

 

Interestingly, Exeter has recently been ranked as the number one clone town in the United Kingdom. That is to say, that its high street and central city retail districts are more dominated by chain operations than any other city in the land. In fact, the only store on the high street which is not a chain is the surviving tobacconist. Everything else is a hodgepodge of Cafe Rouge, Tesco, Carphone Warehouse, and Marks and Spencers. This has the advantage of predictability. I know exactly what is available, where, and when. But if I'm looking for something outside the margins, like some traditionally made welted 'veldtschoen'*, which I'd like to replace my current foam-made rubbish hiking boots, then Exeter has no known solutions.

 

Worse than the lack of certain eccentric opportunities is the dearth of care and class. Every city faces the homogenization that has blighted Exeter. Some may hold out more than Exeter has. But even here places like Cafe Espresso are little gems. They are personable where Starbucks is faceless, they are meticulous where Costa is ordinary and their pistachio and citrus cake must include a dash of the transcendent sublime.

 

Once more into the breach,

Ben

 

* The veldtschoen, or field shoe: shoe in which upper is turned outward when stitched into the welt of the shoe to form a flange.  When combined with durable, dense leathers, and a solid rubber sole, this results in remarkable water proofing and field resilience.

 

(Picture from http://www.herringshoes.co.uk/index.php.  Reproduced here for editorial purposes only.)

British Museum

I always enjoy a trip through the British Museum.  The Near-east and Western civilization wing is remarkably phenomenological in its approach (in the Hegelian sense).  The progression of Athenian ethical life from the more physically pre-occupied earlier Greeks and the cultures of the fertile crescent is part of the wing's physical layout.  But one must be careful not to draw abstractions too indiscriminately from a handful of artifacts, which may be none too representative.  Indeed phallic jokes in Aristophanes, sometimes pertaining to the Athenian politician/aristocrat Alcibiades, may tell us more about Athenian ethical life than Hegel or the Elgin Marbles.

 

Meanwhile, here are some photos.

 

 

 

 

 

Stephen Stills - Go Back Home - Eric Clapton

No comment.

Job Update

Long have I yearned for gainful employment. Quite seriously, the anxiety of job searching had gripped me. My hope was not exhausted, but there was a dearth of expectation.

Fortuna, however, smiles in her own time. In early June I was contacted by St. Edmund (or Teddy) Hall, University of Oxford, and was asked if I could be interviewed on Friday, June 13. I managed to say, 'that would be superb' or something to that effect, though I'm not sure how, as my throat had clenched into a swallow of elation fused with terror.

My colleagues at Exeter arranged to give me a practice interview on Thursday, which went more or less well. Though I felt I handled several questions disastrously and certainly needed more preparation. But the payoff was great, as they anticipated the questions asked in the real interview with remarkable precognition.

Friday came and I decided that Friday the 13 would be a day of bad luck - for the competition. Indeed, I arrived at Oxford by trains 5 minutes a head of schedule (likely the first early train in England for decades) and roughly 2 hours prior to the interview itself. I bided my time by locating Teddy Hall, wandering briefly around town, and taking time to practice my presentation over espresso at Starbucks. I went to the Blackwell's bookshop by the Bodleian, went to the politics shelves, and prayed.

The interview went as well as I could hope, and I had rectified the dilapidated performance of the day before. I even managed to borrow a joke from my supervisor. Even ignorant of the final result, it was a relief that I had shown them quite properly what I'm made of. I left having been told that I would probably be informed of the results about halfway through the next week.

My first move after saying fair well to my interviewers was back to Blackwell's. I decided I the first thing I would do would be to buy a new book on Locke for my collection. I have no illusions about being anything other than a eccentric academic. Much to my astonishment, when I left the bookstore I found that a message had been deposited on my phone. I called voicemail to discover that the interviewers had several questions which they forgot to ask. Being close, I marched strait down the Queen's lane and toward Teddy hall, my mobile phone in hand a prepared to dial back.

So not twenty-five minutes after the interview, I was on the phone with Dr. Karma Nabulsi (the lead Politics lecturer at Teddy Hall). The first thing she told me,

'We want to give you the job'.

I immediately said yes.

Tom Paxton and Pete Seeger

Now this is some pretty impressive folk music.

Christmas photographs coming online

Hey all,

 

I'm just starting to put my Christmas pictures online.  I didn't really take anything on Christmas day, I was too busy cooking in the end, but I got some good pictures from the gathering for my father's side, and from my trip to Chicago with Ahreum, Mom, and Dad.  As always some pictures of my family are not available for general public consumption, so get a flickr id, and add me to your friends list.  My id is elrohil_2, and the link is here: http://www.flickr.com/photos/63822924@N00/

 

Ahreum in Chicago

 

Family in Chicago

 

Once more into the breach,

 

Ben

Wonderful Christmas

I had a very good Christmas this year.  I was home in the States for about one month.  I made some progress on my PhD, went to a conference at Harvard (not presenting) where I met many young scholars as well as my first political philosophy professor Patrick Riley, and researched in Madison.

The real event though was having Ahreum home for Christmas.  We had a brilliant time together, and finally got to see Chicago on the 29th along with Mom and Dad. 

We had a big Christmas meal on the 24th, a low key Christmas day, and another family event on the 29th.  I was very happy that in our family Christmas was really much less commercialized than it might be.  It was better just to spend plenty of time with my relatives and let Ahreum get to know some of them better.

Saying goodbye to both Ahreum and my parents at O'Hare airport was pretty hard.  I've gotten used to saying goodbye, but there is a lot of loneliness served up in one dose on a day like that.  I feel so fortunate to have them all in my life, grateful for the time together, but still a little home sick (where home is located for me is another question).

At the moment I'm writing from Heathrow Airport.  I shouldn't have, but I finally bought a day pass for WiFi Internet access.  It certainly makes waiting for the coach to Exeter a good deal more entertaining.  One can only play solitaire and pinball so long, after all.

I can't conclude without wishing a Happy New Year to all my readers, family, and friends!

Once more into the breach,

Ben