18 Countries in 5 Months: Travel Lessons

I started writing this article in Sydney, Australia and finished in Denarau Island, Fiji.  

Outside the Hilton resort in Fiji

I prefer Melbourne to Sydney—it’s more compact and has better public transportation—but wherever you go, Australians are some of the most open, friendly, and down-to-earth people you’ll meet (except in their airports, which, like America, seem to require hiring citizens with the lowest IQs). In a city where slot machines and horse race gambling are regular additions in bars and restaurants; brothels with mostly Thai workers offer sex for 140 AUD while Australian dancers don't permit touching for less than 100 AUD; and marijuana is essentially legal with a doctor’s prescription, you realize regulating man’s vices can be done in ways that don't automatically remove the populace’s brains or sense of adventure. (In contrast, in well-regulated Taipei, people—both inside and outside of airports—are friendly but your greatest danger is dying of boredom.) 

As Australia is the 17^th country I’ve visited in the last 5 months, I’ve noticed an interesting trend: cities that attract affluent Chinese (or affluent or well-educated immigrants) see property and other prices explode. It seems enterprising Chinese parents have cashed in gains from the Chinese or Hong Kong stock markets and invested not just in Singaporean and Hong Kong banks, but in property all over the world.  When I see smart, young Chinese adults with expensive American degrees helping their parents run a restaurant or hotel in Indonesia, I’m torn between lamenting the loss of talent and realizing that most college-educated Americans could not compete with the competence and humility I see every day in Southeast Asia. 

When I traveled 12 years ago, I saw mostly European and American tourists. Now, I see few Americans and mostly Japanese, South Koreans, Australians, Dutch (wanderlust appears to be part of their very tall genes), and an increasing number of Chinese tourists. (The Canadians can’t be far behind, but you never know with them, since they tend to blend in politely.) [Update: see endnotes for more.]  

In an age when images of American superheroes like Captain America and Superman are ubiquitous worldwide on clothing, backpacks, and toys, you realize the non-American countries haven’t yet figured out they are the New World and the new frontiers—like it or not. I just saw an Aussie boy wearing American flag socks and a Kobe Bryant jersey playing basketball. I asked if he was American, and he was not. (I wouldn’t wear a Dellavedova or Bogut jersey, but there’s no excuse for not appreciating Patty Mills.) 

America's propaganda machine is so good—it better be, with no fewer than 17 intelligence organizations on the taxpayers’ payroll—it seems showing pictures of the Statute of Liberty and WWII prevails over the changing facts on the ground, even as Canada, Turkey, Iran, Pakistan, Germany, and other countries take in more Syrian refugees than America; elect Rhodes Scholars who became self-made millionaires (as opposed to the 2016 Republican nominee, who inherited millions of dollars); elect female leaders who speak out against American surveillance long before Democrat Hillary Clinton criticized Edward Snowden as a lawbreaker and President Obama called him unpatriotic; increase GDP without forcing residents to go into debt for essential items like healthcare and education; build efficient, cost-effective public transportation; and open doors carefully to educated immigrants. (In the meantime, America debates whether to directly accept immigrants who will bring much-needed technology skills; indirectly accept them by granting outsourcing and technology firms a higher visa cap; or not accept them and allow other countries to benefit from their expertise.)

Some people ask me what I’ve learned over the last 5 months traveling across the globe, starting in Colombia and ending in Fiji. If you're interested, keep reading. 

Democracy is Dead

Just kidding. I’ll save the politics till later. I’ll just say the Australian military member I met at a Sydney war memorial knew more about the U.S. Constitution than most Americans, telling me, “No one else but America has a [winner-take-all] two-party system because it doesn’t work.” He grew up working with his hands, a reminder elites in society don't hold a monopoly on knowledge or truth.   

Go to Places where People Ignore Rules Crafted in Response to Fear

Melbourne was one of my favorite cities—except for the airport, of course.  At Melbourne’s airport, the customs official told me to put my phone away (because putting phones away by the time you reach the customs counter definitely, definitely prevents pictures and videos from being taken), then made the grand gesture of holding my passport photo in the air and glancing at me, then the passport photo at least twice. The entire incident, minus the phone discussion, took about 5 seconds or, if you prefer, two times longer than a mentally disabled person would require to look at the passport photo as it was handed to her, remember it, and then determine whether someone was trying to scam his way into Australia with his biometric passport and Australian visa he applied and paid for two months ago. 

In any case, I loved Melbourne (for the record, my favorite cities were Tokyo, Santiago, San Pedro de Atacama, Hong Kong, Melbourne, and Jakarta. Yes, Jakarta. The food is amazing, and it’s the real “land of smiles”—in about 5 years, when public transport arrives, the city will become an easier tourist destination). Melbourne had an oddly familiar feel, and it’s not just because its Luna Park area resembles Santa Cruz, California.  It’s because it felt and looked exactly like American pre-9/11—open, unafraid, optimistic, and diverse. 

Melbourne has a large, popular casino with all the works, including a poker room with a neon sign flashing "Las Vegas" and a fancy food court. Each area has at least one security guard, and signs separating one area from another say bags must be checked. The poker room had a large, ex-military-looking gent guarding it, and I went to him with my bag open as doe-eyed as I could possibly be. In America, I can sometimes get away with looking Mexican, Central American, or Spanish, but in Australia and Southeast Asia, everyone’s first guess was Arab. After the airport experience, I was prepared to be strip-searched, but the gent gave me a wide smile and said, “It’s ok, mate, I trust you.” The second and third time I moved between areas without being bothered was when it hit me—Melbourne is a city where people have kept their common sense. The large security guard saw me reading the rules next to the entrance and must have figured out potential terrorists don’t bother reading written regulations before making their move.

From that moment, seeing Melbourne and Sydney made me sad. Everywhere I went, I was reminded of San Francisco and Santa Cruz, but without Donald Trump or Sarah Palin as potential rulers. Government unions in Sydney are doing the same thing as the ones in California—demanding greater pieces of the tax pie and claiming if they don’t get the money, they cannot guarantee safety. The Australians shrug off such fear-based threats and focus on maintaining their existing 15 USD minimum wage and a healthcare system that covers all their medical bills (but not their ambulance bill) for 1.5% of their income. That’s 1.5% of their income each year (the military gent I mentioned earlier told me, “I don’t even notice it—comes out of my regular paycheck.”). Their outgoing central banker, Glenn Stevens, gave such a compelling, educational interview in the Australian Financial Review (see 9/9/16 edition), I promised myself I was going to read everything he wrote. 

I now know why George Soros—who is more often right than not on macro issues—calls his programs “Open Society.” When you live in an open society, good things happen organically, and people unafraid of each other are more likely to collaborate spontaneously without meeting at the same expensive universities. In Sydney, I met an American dancer at a basketball shop who taught me more about fashion economics than I learned in the last ten years. I would have never met him in America. He told me he’s moving to Australia under an immigration program designed to attract workers under 31 years of age. He’ll be closer to his Fijian girlfriend, too. Meeting him and experiencing his optimism and energy firsthand made me happy for the rest of the week. (Thanks, Maleek!)

Places that aren’t open societies or that spend an increasing allocation of tax revenue on military or law enforcement bleed and repel talent if the allocated tax revenue is at the expense of non-law-enforcement job growth.  Over time, assuming options exist, the most open-minded or financially stable people prefer to live in open societies, which also tend to be happier. 

It is no coincidence that Melbourne and Sydney are similar to two of California's most prosperous cities, Santa Cruz and San Francisco.  The formula is the same:

1. Attract law-abiding, hard-working immigrants. 

2. The immigrants bring new talents and/or increase demand for essential services and items like housing, gasoline, groceries, insurance, and healthcare. 

3. The increased demand boosts the value of existing residents’ houses, making them feel richer. (Ask yourself: why have housing prices in American cities increased more in diverse rather than non-diverse places, or near diverse places?) 

4. Existing residents feel richer and spend more money, increasing demand not just for essential services, but for expensive coffee, clothing, etc. 

5. A new creative class emerges, attracting young people and more diverse jobs, such as website design, interior design, etc. 

6. The government sees a higher tax base and increases government jobs, usually to people connected with political or real estate players, which again favors existing residents rather than immigrants. 

7. Everyone is happy…until the demand from immigration succeeds too well, pricing out the next generation from housing and other markets. 

After the last step, societies have a choice: a) they can turn on each other, refuse to make sacrifices, and blame each other; or b) they can try to increase mobility, spread out job growth not just in the large and now-larger cities that have attracted immigrants (i.e., spread the wealth geographically), and achieve a balance that militates against excessive inflation in essential items like housing, college, and healthcare.

Existing residents usually split in two groups—the ones that owned houses before the immigration boom and the ones that rented. (You can guess which group blames the different-looking residents for their new problems.) [Update: while the Italians and Irish are similar enough visually to blend into societies together after both learn the official language, the same is not true with more diverse immigration, where a black African still cannot blend into a European country even after speaking the native language better than locals and wearing Nikes or Prada. One reason ASEAN will continue to be wildly successful is because immigrants can more easily blend in.]

By the standards mentioned above, America is the worst of all developed countries—not only is it the only developed country appearing to lack efficient and broadly available public transportation in its major cities, it also requires its residents to go into at least five-figure debt to get essential items like a college education. In most developed countries, personal debt is anathema. Listen to Brad Katsuyama from Flash Boys (2016) talk about his experience coming to New York from Canada: “Everything was to excess…I met more offensive people in a year than I had in my entire life. People lived beyond their means, and the way they did it was by going into debt. That’s what shocked me the most. Debt was a foreign concept in Canada. Debt was evil. I’d never been in debt in my life.”

Once I realized personal debt was necessary to achieve a basic standard of living in America, especially for younger people, I connected its increasingly authoritarian society with attitudes towards personal debt. The Vietnam War saw numerous protests in America, including ones where college students were shot and killed. Syrian and Libyan wars, in contrast, saw few protests and certainly not sustained or effective ones.  Part of this change is obviously the lack of a mandatory draft, but a society in debt or with excessive inflation in essential items is not one that can buck the Establishment or established political players, especially during a recession, when government spending drives job growth. 

I’m going off course again, so I’ll end this section with a quick observation: the only airports I saw with the new scattershot body scanners were American, Thai, and Australian. (The Thai airport personnel were nice, so the American and Australian machines must come with a training manual titled, “Fear is the New Black: How to Pretend to Be Military-Tough without Actual Military Training.”) As some societies become more open, others are becoming more closed. It’s not surprising economic protectionism follows when people become more fearful of each other, unaware that the same immigrants they increasingly fear are the precise reasons for their economic growth thus far. 

In my own way, I’m doing what I can to maintain the vestiges of American rebellion (RIP George Carlin). In Santiago, Chile and every single other South American airport, I took videos of the airport baggage area and sent them to the TSA on Instagram with snarky comments such as, “Santiago is the most prosperous city in South America, and its airport has plenty of tourists and fancy shops, but they don’t have a TSA.” In Tokyo, my favorite city, it took just 5 minutes from the time I exited the airplane to get past customs/immigration, so I didn’t have time to take a video—now that’s efficiency. [Update in April 2017: it took me about 10 minutes each to get through customs and security in the Dominican Republic and Costa Rica.] 

Open Societies Don’t Care What You Do in Your Bedroom

Ladyboys, transsexuals, sapiosexuals (if I see that word one more time in a dating profile, I’m going to puke), and homosexuals—what do they have in common?  In open societies, no one gives a damn about your sexual preferences. 

In Bangkok, I was served by ladyboys wearing too much makeup in grocery stores. In Manila, a Muslim mall shopkeeper with a headscarf wearing sandals worked alongside a Catholic wearing a gold cross and Nikes. In Fiji, the best servers at my resort are 6’3”, 250 pounds, with waxed eyebrows and high-pitched voices. There are red light districts in prosperous Sydney and not-so-prosperous Bangkok—and like all red light districts, they have delicious, reasonably-priced food available at 1:30AM. 

We’ve talked about personal debt and excessive or artificial/external inflation being the death knell of peaceful economic progress, but the other consistent component of an open society is sexual openness. Before France tragically experienced terrorism, most news articles mentioning the country would discuss the President's mistress or the copious amounts of sex (inside and outside marriage) French couples were having. Suddenly, the articles shifted to cities banning full body swimwear (“burkinis”) and police officers forcing Muslim women to remove their headscarves at beaches. (ISIS itself couldn’t have created better propaganda showing Western hypocrisy on freedom of religion.) Which article would you rather read—the one about a city council having nothing better to do than pass a law allowing cops to harass old Muslim women on the beach, or the President shagging a model with his wife’s permission? 

After experiencing a traumatic event—especially terrorism—societies and governments have a choice—they can remain open or they can close themselves off directly (restrict immigration) or indirectly (allocate more tax revenue to unnecessary military expansion, whether domestic or international). I’ll give you one guess which direction much of America has chosen. (If you're an Aussie airport employee, you can have four guesses--I believe in leveling the playing field.)

Successful Societies Maintain Informal Norms

Not following stupid rules, using common sense, and letting people have sex in peace create a natural segue into my next topic: the informal vs. the formal, or “How Did We Allow Lawyers and Insurance Companies to Set Behavioral Norms?” (aka What’s Behind the Rise of Donald “I’m Not Politically Correct” Trump?) 

Counterargument in Duncan J. Watts' Everything is Obvious (2011)

I’ve mentioned Dan Ariely’s book, Predictably Irrational (2008), before. Ariely discussed an Israeli daycare’s late pick-up policy. Initially, a few parents were late picking up their children, causing the daycare to incur overtime. In an attempt to minimize disruption, the daycare instituted a penalty for late pickups. Each late interval incurred a fee. What happened next? Late pickups *increased*. Ariely’s accomplishment was figuring out why. 

Ariely determined that before the penalty (which could also be called a rule or law), social norms rather formal norms prevailed. Ariely called it “shame,” but whatever you want to call it, it worked better than the rule-based or legal system. Basically, when you trust people, they usually rise to the occasion unless other incentives interfere. The minute you get lawyers involved, people start doing cost-benefit analyses and try to “game” the system. In the case of the daycare, they will have to add more rules (higher penalties, shorter intervals etc.), which function as amendments without any end. All too suddenly, a new law or rule becomes more complex and convoluted and still doesn’t deliver the intended result. As Michael Lewis wrote in Flash Boys (2014), “Every systemic market injustice arose from some loophole in a regulation created to correct some prior injustice.” (Bonus: "As a law professor... I certainly understand the law and the rules. And one of the things I understand is that you can't write a law that I can't get around." -- Michael Josephson) 

Go look at any random American civil code. Observe the numerous subsections, which usually indicate a lobby group or group of concerned citizens have, over time, exempted themselves from the law’s purview or at least minimized its bite. What’s that? You say some new laws protect more people, such as transgendered people? Ask yourself: in the absence of express diversity quotas, is a small business owner more or less likely to hire someone who can sue him for discrimination, or someone who looks like him and who belongs to the same religious institution? If the latter, does such a dynamic mean that small employers are encouraged to hire minorities (whom the law intends to help) after they’ve hired everyone they know and only when demand quickly escalates beyond what they anticipated? 

Creating too many rules or laws almost guarantees—in the absence of an irreverent, anti-authoritarian culture—people will more likely do the minimum required by law, because lawyers have interjected themselves in a social norm and overruled it by fiat. Sure, we have the Queen and her progeny as a useful conduit to establish social norms in the U.K. and to take attention away from Englishmen with bad teeth and out-of-shape British women, but when lawyers set too many social norms, they take away personal initiative, and societies become apathetic. Indeed, more laws don’t mean the intended goal of the law will be achieved or even promoted—it could mean that people see the law itself as an excuse or barrier to acting on their own. Meanwhile, in Japan or South Korea, social norms often prevail over legal ones, so any older male can be an authority figure, not just the police. 

I experienced this dynamic myself when I did pull-ups on the train—an older Japanese man tapped me on the shoulder and made a disapproving gesture. In a movie theater, I had temporary restless legs syndrome, and an older Japanese man three seats down reached over and gently put his hand on my leg, indicating I should stop. In Seoul, a Nigerian-American teacher told me, “The police here [in South Korea] have little power—I’ve seen older Korean men overrule the police and tell the police what to do, and the police complied because the man was older.”  

Thinking about this social dynamic provides more insight into why some Asian countries, like Japan, are opposed to mass immigration. It’s not xenophobia or racism—it’s because they haven’t figured out how to maintain their harmonious social norms, which, in the case of Japan, have led to one of the most peaceful, polite, safe, and efficient countries in the world.

No system is perfect, and an obvious flaw exists in this particular norm system—older men aren’t exactly a diverse demographic when it comes to enforcing rules, and having every man over 50 years old as a potential enforcer doesn’t help foster a culture of creativity or innovation.  Japanese women seem to be quietly rebelling against the “older men as social enforcers” dynamic by refusing to have kids and using the Japanese yen’s strength to study abroad and travel as much as possible. (A big shout out to the Japanese study abroad students who took me to Melbourne’s St. Kilda beach and took fun pictures with me, a random stranger they’d just met in a cafe.)

At least under the Western system, you’ll have more women and minorities able to have a voice and shift the culture. Yet, is that really true? The point of the law is to create a predictable system. If the male judge in Courtroom A interprets an anti-discrimination law, a witness’s credibility, or the admissibility of a piece of evidence differently than the female judge in Courtroom B, then justice is determined by the random assignment of a judge or a random judge's subjective beliefs about what juries should see. In addition, most American judges are older men anyway. 

Look at your average police station—mostly white men (though cities are becoming more creative and appointing more minorities as public faces of their departments, which looks good but does nothing to change the dynamic for 80 to 90+% of the employees and the residents with whom they interact). Your average K-12 district? Mostly white female teachers. (From Ed-Data in 2010: "In 2008-09 California’s teachers were predominantly white (70.1%) and female (72.4%), quite a different look from the student population that was 51.4% male and had major ethnic categories of 49.0% Hispanic, 27.9% white, 8.4% Asian, and 7.3% African-American.")

At the end of the day, are the Western and Eastern systems really so different? And shouldn’t the question be how to create a society as harmonious as Japan, but with more input from everyone, not just older men? As a Canadian told me in Taipei, “Things changed when we stopped caring about each other.”

Formal Norms Destroy Harmony as Lawyers and Government Enforcers Take Over Society and Divert Tax Revenues into their Pockets

Worst of all, as more laws are passed, the more funding x group demands to enforce such laws. Soon thereafter, society becomes increasingly fragmented as existing political players are scared by the potential threat to their own funding and use their media connections to attack the new players (see, for example, traditional K-12 districts vs. public charter schools—I mean, God forbid students in failing or inner city schools be allowed options); the entity receiving new funds does whatever it takes to make sure it can sustain its new funding (if it cannot produce objective results, then it usually relies on fear or presumed heroism by highlighting outliers); and people still not part of the government's largess have no choice but to use victimhood, whether real or imagined, to gain equal access to government-fueled job growth or at least to prevent themselves from being used by others to justify government funding. 

For example, see Ferguson, MO, where studies have shown the poor and politically-disconnected are fined at alarming rates to maintain government jobs or government job growth, or intentionally segregated: 

Exploitation "is in turn made possible by residential isolation. Ever since the creation of the 16th-century Venetian ghetto, the physical separation of a dishonored group has served to shield the larger city from the consequences of disinvestment in the marginalized area, and to shift the blame for the conditions in the community onto the dishonored group. The maintenance of segregation--by race or class or religion--permits the cycle of neglect to continue." (The Atlantic, June 2016, page 37, Patrick Sharkey.)   

By the way, it’s not just government that’s fragmenting society with its funding demands and overreach into private lives—private companies are destroying their reputations when they use metrics designed to measure performance but which, like most other rules, become gamed over time.  The metric becomes the goal rather than the service. (See Goodhart’s Law, which Ruchir Sharma explains in The Rise and Fall of Nations (2016): “[O]nce a measure becomes a target, it ceases to be useful, partly because so many people have an incentive to doctor numbers to meet it.”  I’d add that metrics cannot capture intangibles essential to customer satisfaction and therefore the long-term viability of a brand.) 

I tend to focus on government actors rather than private sector bad actors.  Fiji Airways (love the English subtitles and captions in your in-flight movies, but still waiting on your response to my complaint about the Sydney airport fellow) and Starbucks might give you terrible customer service, but their employees won’t come into your home, shoot your dog, and still keep their jobs if they act on a bad anonymous tip. With corporations and businesses, the key is to focus on externalities and the environment, which is another way of saying that banks and natural resource companies need to be heavily regulated but without applying the same level of scrutiny to other, more productive and more innovative businesses. Sadly, the American government is also inept in this area—it not only failed to catch Enron’s financial shenanigans, it actually approved one of its accounting methods, and according to Michael Lewis in Flash Boys (2014), the “only Goldman Sachs employee arrested by the FBI in the aftermath of a financial crisis Goldman had done so much to fuel was the [computer programmer] employee Goldman asked the FBI to arrest.” 

Innovation, Immigration, and Debt-Fueled Development  

As I wrote above, cities that attract the best or hard-working immigrants win economically, at least for one or two generations.  It’s not a big leap to go from cities to countries and to realize that absent some exceptions, immigration has been responsible for *all* of America’s and Britain’s post-WWII success (one could even argue that a German-Jewish immigrant, Einstein, along with immigrant Leo Szilard, helped win WWII with nuclear innovation). 

Economists, philosophers, writers, pundits and academics, like everyone else, are subject to confirmation bias or other biases. They see their country’s new prosperity and, absent a clear breakthrough such as the discovery of new natural resources or technology, attribute it to a particular way of doing business (“What’s Good for GM is Good for America,” which then morphed into studying the “superior” Japanese business model); a particular leader (Winston Churchill or Harry Truman); and/or a particular religious construct (the Protestant work ethic, Judeo-Christian values, etc.). The last one always baffles me, because Christian/Catholic antipathy and discrimination against Jews has been well-documented and includes much more than just Reichskonkordat and ordinary Germans juggling church and National Socialist meetings. 

From the U.S. Holocaust Memorial Museum website: in 1933, “Almost all Germans were Christian, belonging either to the Roman Catholic (ca. 20 million members) or the Protestant (ca. 40 million members) churches.” 

From Warren Hinckle's If You Have a Lemon, Make Lemonade (1974)

If I’m right about immigration, then the rise in demand I discussed earlier because of new residents is the real source of Western prosperity, not any type of after-the-fact theorizing, especially when you add debt to drive economic development. Stated another way, what if most Western post-WWII economic growth is a simple combination of immigration plus increased bank, VC investment, and corporate loans? Think--the easiest way to increase demand (and jobs and tax receipts) is to pump more money into a country’s economy. As long as that additional dollar keeps making the rounds, from the business owner to the employee to the local café owner to the local mechanic and to the restaurant owner, it will become four dollars without any need for innovation, further addition, or unique competitive advantage. With enough debt, any economy can be transformed from supply-driven to demand-driven. Adding immigration and marketing to debt turbocharges the sleepiest of hamlets—at least for a while. 

At some point, however, especially if wages don’t rise with the cost of essential items, issuing debt has less economic impact. Businesses may continue to use loans to cushion themselves against unpredictable cycles, but the dollar of debt no longer circulates four times, enriching all who come in its path—it may not even move at all if lower interest loans are used to pay off earlier, higher interest debt. 

You might be asking yourself, "What does this have to do with his travels?" Every single prosperous Western city I’ve visited in my life has been diverse, with many first generation immigrants. I don’t think it’s a coincidence. In fact, the only two major advantages I see Western societies having over Eastern societies are diversity and materialism. Materialism is a funny way to describe an advantage, but once you realize Western economies rely on consumer demand to drive job growth and use debt as a growth turbocharger, it’s obvious why Western governments and central banks are doing whatever they can to re-generate the money flow. Is this model sustainable in the absence of continued immigration?

Now What?

Far be it from me to suggest having 2,391 different kinds of sodas isn't the pinnacle of Western prosperity, but seeing different systems work in different countries makes you listen—I mean, really listen—to different viewpoints. Many Asians I met told me, “You Americans have too much freedom.” 

If you have excess order, you still have order, but if you have excess liberty, you have chaos. -- Will Durant, historian 

They meant they’d rather have a little less freedom to say whatever they want in exchange for much more harmony and peace. One lesson is that fewer options don’t necessarily translate into worse-off societies if government attracts intelligent people. 

In Chinese culture, the state is preeminent. Better a year in tyranny than a day in anarchy. Order is everything in China. -- Michael Wood (2020)

When I scored an upscale resort room in Hilton Fiji Denarau (after 15 years of saving AMEX points, it seemed like a good time to use them), I finally figured out why people pay so much more to isolate themselves from the locals. When I travel, I always try to stay in areas where the locals live, or I just get an Airbnb. Resort areas are essentially the same, so what’s the point? Well, the point is that you’re around people who can afford to be there, so it feels safer and more cozy—you might even make a business connection or two. It goes without saying the sunsets and rooms are exquisite (My Hilton beachfront room had a shower AND a large bathtub). You’re also around staff who are super-nice to you because they have the best-paying job for miles. I suppose financially-incentivized kindness is better than scorn or apathy, but I still say the food is always worse and more expensive in resort or beach areas, and I’d rather have access to a 5 to 10 USD foot massage in a run-down strip mall than a 50 USD one in a fancier ambiance. Once every 15 years ain’t a bad time to hit up a fancy resort is all I’m sayin’.  

[While we’re on the subject of companies, the most useful apps were Airbnb, Agoda, Uber, Couchsurfing (check out the events, which include walking tours), Tinder, iTranslate (paid version), Google Translate, Orbitz, my banking app, AMEX (to pay my recurring bills back home, like my Netflix account), and various messaging apps—WhatsApp, Viber, WeChat, and Line. Many people recommended Grab, which is similar to Uber. When I get back, I’m getting the iPhone with the largest memory capacity—16 GB wasn’t enough for all my pictures, apps, and videos. T-Mobile's worldwide roaming plan was fantastic--it saved me from having to buy SIM cards in every new country, though I was sometimes stuck with 3G rather than LTE or 4G. (Update on February 2018: after about two years of using T-Mobile's international roaming plan, it was unexpectedly canceled.)] 

Regarding airlines, LATAM Airlines was the best in South America. For shorter trips, budget Air Asia was just fine. I'd avoid Avianca, Qantas, Blue Panorama, Lion Air, and Fiji Airways. Use Virgin or Virgin Australia instead.] 

Seen January 10, 2019 on LinkedIn

Told you not to use Avianca. 

I’ve already told you one other lesson: informal systems can and often do work better than formal systems in creating harmony and psychologically healthy societies. Despite not including metrics like opioid prescriptions per capita in their statistical analysis of success, formal systems should work better at allocating capital and allowing knowledgeable workers greater access to higher wages. In Jakarta, which had the best and most interesting food and tea I’ve ever had (even better than Singapore’s hawker stalls), I met a college-educated woman making about 4,000 USD a year working 40 hours a week with a 3 hours daily commute. She spoke fluent English, French, and Bahasa Indonesian and used to work in a foreign embassy. Another woman I met in Cebu, Philippines had an MBA, spoke perfect English, and was smarter than most Americans I’ve met. She makes 7,500 USD a year (not including expense reimbursements) managing upscale pizza franchises in several cities. 

Put either of them in any country that favors a formal system, and they’d make at least 40,000 USD—but would they be happier? I suppose it depends on how well infrastructure improves, cutting down on commute time and pollution levels—and whether they feel as if their skills are rewarded appropriately and whether their children have greater opportunities than them. Many smart people I met overseas wanted to go to Canada or Australia, or, as a third option, America. The 21^st century seems to be defined by jobs and taking risks to get better pay, which benefits the destination country (as I explained above) while boosting the earning capacity of the immigrant. Countries that don’t value their smart workers, especially their female ones, are going to lose them. (Believe it or not, getting a job in an upscale mall in the Philippines may require a college degree—to guarantee the worker speaks fluent English to satisfy tourists—and student loans don’t really exist in developing countries.)

In any case, the informal vs. formal is the lesson I keep returning to. In developing countries, which often lack paved roads near their beaches, drivers honk horns to warn pedestrians they’re coming or the car in front of them that they’re about to pass. Despite traffic too zany for me to ever contemplate driving in any SE Asian developing country, I never saw any driver honk his horn in anger at another driver. Once, when there was a miscommunication, two drivers waved repeatedly at each other, honking horns to signify contriteness, a symphony of apology. 

Contrast with Germany. From Nat'l Geographic (Dec 1961)

Conclusion

I’ll leave you with my favorite quote from my travels, from a Filipina woman who had a keychain in the shape of a dildo. When I asked her about it, she remarked, “I don’t understand people who don’t like sex or who don’t like talking about it.  Where do they think they came from?” 

Where, indeed? 

© Matthew Mehdi Rafat (2016) 

Update 1: I realized I didn't mention South America much. Rio was overrated, though its Botafogo neighborhood had some interesting cafes and bookstores. I also enjoyed the Cinelândia area. Both Botafogo and Cinelândia take 1/2 a day to see each, though Botafogo is best seen on a Friday or weekend evening.  (I didn't go to São Paulo, and every Brazilian I know swears I'd have a different opinion of Brasil if I visited its commercial center.) 

Cartagena's old town is romantic and worth a one-day visit.  Medellin, situated in a valley and therefore cooler than most Colombian cities, has much potential. Overall, however, Colombia needs so much infrastructure, I see no reason to return in the next 10 years. My worst airport experience was in Colombia, where Colombian-based Avianca airline staff misled me. I had to call a Colombian friend in California to assist me and was charged twice for a replacement ticket--no small sum. Although Avianca is one of South America's largest airlines, for safety and convenience purposes, I'd avoid them and choose LATAM or Copa instead.

Buenos Aires, Argentina is a fun, vibrant place and not as expensive as Chile. Many tourists enjoy the trendy Palermo neighborhood.   

Colonia, Uruguay--accessible by Buquebus--is a cute little hamlet.  

Chile was my favorite South American country and also the most "advanced."  It doesn't seem a coincidence that Chile was able to "re-set" many of its problems after Pinochet's often brutal regime. 

Perhaps there's another pattern worth following: after various government agencies gain too much unchecked power, they often become ineffective or arbitrary despite their increase in power. (Absolute power corrupts, remember?)  At that point, a strongman ruler is more likely to get elected or ushered in by a coup--whether in Turkey, the Philippines, or America--and the people, fed up with ineffectiveness and corruption, give license to extrajudicial measures, as long as they feel the ruler is trying to clean up the mess. ["People will put up with corruption as long as it works." -- Alan Beattie, False Economy (2009)] 

Mexico's "strongman" ruler was in power for 30 of the 34 years between 1877 and 1911. 

The psychological effects of the new, often politically incorrect politician are immediate--people are energized because they feel as if their voices have been heard. I've visited the Philippines several times.  After the Philippines' recent election, I was struck by the chasm between what I was seeing and feeling in the country--renewed optimism and hope--and the media's reporting of an out-of-control politician.  The Philippines' Duterte is a lawyer who's taken on the Catholic Church and mining companies and spoken in favor of environmental regulation and women's rights. (Just goes to show you--you can't trust the media.  Get out there and see for yourself before making any conclusions.) 

I'm guessing the positive mood was the same in Turkey after the July 15, 2016 attempted coup, when people came out in droves to support the existing president, who then removed thousands of government employees allegedly involved in the coup, including teachers. Do years of static government consolidation require a strongman to use extrajudicial means to clean up shop?  

Seeing lithium miners' poor living conditions in one of Chile's most visited tourist towns indicates that a strongman may be able to reverse stagnation and corruption, but the long-term picture is not clear.  In an ideal world, people would realize how lucky they are to live in relative peace and do whatever it takes, including self-sacrifice, to never reach the point of needing a strongman ruler. 

Update 2: I originally thought I'd been traveling for 6 months straight, but someone told me it's about 5 months straight--from April 22, 2016 to September 16, 2016, or 147 days. 

Update 3: right after I wrote this post, where I mentioned not meeting many Canadian travelers, I met a Canadian solo traveler in Fiji. She lives in New Zealand as a dental hygienist. She’s going back to visit her family for X-Mas because she’s yet to adapt to sunshine in December and no natural fir trees. As is the case with most of the non-Eastern-European white women I’ve met, the conversation ended abruptly after I questioned one of her statements. I realize the line between playful mocking and polite criticism can be a fine one, but no other culture except the one practiced by educated Western white men and women seems so sensitive to having clearly incorrect statements contradicted. Such cultural uniqueness, even if not as widespread as I believe, is causing a backlash in many developed Western countries, where anti-political correctness movements may take unexpected turns, especially against politically vulnerable ethnic or religious minorities. Stated another way, there is no Indonesian equivalent to America's Andrea Dworkin. In fact, much of Asia's religious symbolism and therefore its culture revolves around men and women's interconnected natures. (Fun fact: literally translated, the expression for "thank you" in Bahasa Indonesian means "accepted/received with love.") 

In any case, after a conversation about our travels, the educated Canadian said that Australian *airport* employees were “smart” because they recently caught two Canadian girls smuggling in millions of cocaine.  I pointed out Australia was in the middle of nowhere and didn’t have land-based borders, so assuming its Navy was on the job, it was easier to prevent drug trafficking, and in any case, it wasn’t the Aussie airport employees per se who would catch the drugs—it would be trained dogs. She persisted in defending the Aussie *airport* employees and after she left, I looked up the incident. Yup, it was an international effort and drug-sniffing dogs caught the enterprising Canadians. The two Canadians—both under 30—weren’t criminal masterminds, either, as they went on a very expensive cruise and posted Instagram pictures of their travels. I think I may have crossed the line when I added that the Aussie government isn’t going to report their failures in catching drug smugglers, so the only ones she’ll hear about would be the occasional successes and again, drug-sniffing dogs and basic surveillance—not Aussie ingenuity, which has yet to lead to a country-specific cuisine or Aussie-made technology used widely beyond its borders—would be responsible. [Update: Stephen Le's 100 Million Years of Food (2016) discusses some Australian attempts to incorporate its indigenous population's cuisine into more mainstream fare, so perhaps there's some hope for Aussie cuisine.] 

I declined to say that even Canada managed to invent Blackberry and Lululemon, and what have the Aussies ever done for us (outside of mining)?  Just to be sure, I looked up Australia’s number one technology company.  It’s Atlassian (symbol: TEAM), founded in 2002, with 1,700 employees worldwide. (Yeah, I never heard of it, either.) One gets the sense white Western culture depends on not looking like a fool even if richly deserved, which would explain why the U.S. wouldn’t issue any comment on the Chilcot Inquiry and is increasingly becoming like a cranky old man refusing to admit that he just fell asleep in his lounge chair or made any other mistake, ever. 

Update 4: from The Pew Center, "Modern Immigration Wave Brings 59 Million to U.S., Driving Population Growth and Change Through 2065," Lopez, Passel, and Rohal: "Between 1965 and 2015, new immigrants, their children and their grandchildren accounted for 55% of U.S. population growth. They added 72 million people to the nation’s population as it grew from 193 million in 1965 to 324 million in 2015...The combined population share of immigrants and their U.S.-born children, 26% today, is projected to rise to 36% in 2065, at least equaling previous peak levels at the turn of the 20th century." 

National Geographic magazine, seen on airplane in January 2019.
Note that the man who raised Jeff Bezos was a Cuban refugee.

Update 5: my Taiwanese friend just told me Taipei is the most "laid back" developed Asian city--a welcome contrast to my satirical comment above about boredom. 

Update 6: looks like Berlin, Germany is doing well on at least one metric. 

From May 2019

Bonus: an earlier post about my travels is HERE.

March 2017: Toronto is HERE.

June 2017: Cuba is HERE.

August 2017: Cebu, Philippines is HERE.

September 2017: Brunei is HERE. 

September 2017: Yogyakarta, Indonesia is HERE.

September 2017: Abu Dhabi (UAE) is HERE.

September 2017: Oman is HERE.

September 2017: Qatar is HERE.

October 2017: UNWTO's 2017 Conference is HERE.

October 2017: Istanbul, Turkey is HERE. 

December 2017: a summary of travel post links is HERE.

Multiplexity: Difficult Questions in a Complex World

People in general don’t ask the right questions or don’t bother with data that contradicts their presumptions.  The globalized world is so complex and specialized, the only sane starting point is that you know nothing unless you have information from an honest expert. Unfortunately, most of us get information from TV, which relies on titillation or outliers to gain eyeballs (but not brains).  Once we consider how few companies control the news; how much the military and government spend on advertising (the amount is so large, the Congressional Research Service once remarked, “It is unclear how much the executive branch, let alone the federal government as a whole, spends on communications each year.”); and how government agencies funnel information only to outlets that agree with their political positions or support them, we can see the TV is the last place to look for objective data.

In an ideal world, TV would have lots of documentaries and experts discussing the intricacies of their work.  For example, why has crime spiked in x city? Instead of listening to the same pundit try his or her best to fill up the demands of a 24-hour news cycle, the media should showcase the local police chief and sheriff.  Not only would this create more direct accountability, it would force the media to focus on refuting the claims made by the local law enforcement official or to assist him/her in improving conditions.  In other words, under such a system, the media would be useful as a check and balance against lies by public officials or as a supporter of potential solutions.

I don’t watch much TV, but when I see police officials televised, they’re often not responding to any specific issue or providing input about a specific problem they’re seeing within their area of personal knowledge.  Instead, they’re often talking about issues outside of their area of expertise, such as family values.  If I see ten families with single parents who are experiencing problems requiring police intervention, I may believe family values are the primary issue. Yet, because I do not see single parents from more affluent households, I may not be receiving enough data to form an accurate opinion. Even if I did see enough single parents, I may not be able to determine, without extensive interviews, whether the problems I see arise from poverty or some other stressor, such as temporary job loss or inadequate savings.  Problems often have multiple causes, and other than a few persons like Warren Buffett, no single individual possesses enough patience, time, and access to honest experts to identify the source of a complex problem, much less resolve it.  To prevent useless pontificating, the first question to ask any public official ought to be, “What keeps you up at night?” or “What issues did you not anticipate when you first took this job?” or “What issues have gotten worse since you took this job?”

You’ll see two important factors in my analysis above: honesty (truth) and cooperation (absent unique traits possessed by only a few individuals).  A successful society should maximize honesty and cooperation. To do this, we must study what systems and incentives promote such values.  Without such values, nothing else matters if a sustainable and mentally healthy society is the goal.  I’ve been focusing on economic systems and transactions my whole life, believing that the proper incentives within a well-designed economic system will promote honesty and cooperation. I now see that my singular focus on economics stems mainly from my own lack of access to money and financial stability when I was younger.  Even as I add psychological factors to my list of topics to explore, I believe stability and sustainability rely upon providing people with meaningful work (including the option of raising one’s own children) and low inflation in essential items, such as housing and nutritious food. (As a side note, Dan Ariely’s Predictably Irrational is an excellent starting point for anyone interested in the intersection of psychology and economics.)

Below you'll see a very long list of topics and questions.  Each one might warrant its own post, and you'll need patience to get through all the topics.  I suggest doing one topic a day to help with critical thinking.

1. Should you join the military? One reason the Vietnam War ended—with a loss for the Americans—is because of the visibility of the increasing number of Americans who died in the war.  Today, with drones and other weapons, it is easy to kill the enemy (as well as civilians) without incurring dramatic losses, as long as war is restricted to countries that lack access to advanced weaponry. Even with technological superiority, the U.S. has lost every war since Vietnam, except for skirmishes in Granada and Panama.  (The first Iraq war doesn’t count as a victory when it required America to re-invade a few years later, culminating in the creation of ISIS.)

You are thinking of joining the U.S. military.  You live in a rural area where job opportunities are not plentiful, and you don’t want to go in debt to attend the nearest university, which requires you to move to a different city.  You’ve heard of the Chilcot Inquiry.  You know its findings include that the 2003 Iraq war was unnecessary and relied on false intelligence, causing over a hundred thousand civilians to be murdered.  (Note: the U.S. military has a history of killing civilians going back to the Vietnam War, when General Curtis LeMay advocated an ill-advised strategy of using air power and bombs against North Vietnam to end the war “by taking out factories, harbors, and bridges.” Such bombings instead convinced northern Vietnamese residents to join the opposing army in large numbers.)

You may not know that prior to the 2003 Iraq invasion, Admiral Sir Michael Boyce, chief of the British defense staff, advised then-PM Tony Blair that civilian casualties would likely be in the “low hundreds,” but you have a sense that civilian political leadership is focused on domestic economic issues and has lost the stomach to question military leadership. You know that joining the U.S. military might give you opportunities that you would otherwise lack, such as traveling to different countries, and you’re smart enough to know that plenty of civilian positions exist, such as maintaining planes and equipment, or even being a cook on a ship.  You don’t see much value in working 9-6 in a local job, because it doesn’t give you the opportunity to serve a higher purpose or to create lasting bonds.  Yet, you also know if you join the military, you will be subject to greater restrictions on your behavior as well as the possibility in helping your country murder civilians abroad. You know that the two current presidential contenders are incompetent or voted for the unnecessary Iraq War.  What is the correct moral choice?  What is the correct practical choice?  Why might they be different?

2.  On central banks and inflation targeting.  The current economic system relies on ever-increasing inflation, primed by central banks. In the past, each dollar was linked to a finite resource, gold.  Each citizen could trade dollars for a certain amount of gold, thereby providing a check against excessive government spending.  After 1971, the U.S. used its credibility and superpower status to gain the ability to print money.  In doing so, it helped the U.S. increase its military expenditures, which in turn helped end the Cold War, giving the U.S. sole superpower status.

Today, central banks worldwide have issued debt between 30 and 40 trillion U.S. dollars.  From 2007 to 2010, due to the banking crisis, the Federal Reserve alone issued about 16 trillion dollars.  Much of the new debt post-2001, however, has been used for military or intelligence agencies, including, for example, the Iraq war and creating new agencies such as the TSA.  The U.S. has 17 different intelligence agencies.  The direct benefits to American residents as a result of recent military adventurism and intelligence-gathering operations are unclear.  Whereas much of the debt issued to banks from 2007 to 2010 were in the form of loans, requiring them to be paid back, the money spent on the ill-fated war in Iraq and other military activities is often secret and off-budget (through abuse of a Congressional option known as appropriations, designed to allow Congress to fund short-term, necessary, and limited operations without needing to go through the normal budget process but which is now used by the military to gain unlimited funding).

Some Americans argue that central bank printing has corrupted the country and we should either abolish the Fed Reserve or go back to the gold standard.

If we return to the gold standard, what happens to the 30+ trillion owed by central banks? Should countries worldwide agree to waive a portion of the outstanding debt to each other and create a “reset”?  Would doing so help future generations in all countries, who are positioned to pay off the debt?  Or would it not matter, given that the debt can be held infinitely because countries technically have no end date and are assumed to last forever? (And why are we still talking about gold as if it’s the default physical store of value in an age where rhodium, platinum, oil, and silver also have industrial uses? Are there other physical stores of value that would be rare/finite, useful, and universal?)

Part of the reason inflation is considered to be beneficial is because it devalues the debt owed.  For example, if you borrow 1 dollar today, it should be easier to pay off in a year because the value of your wages or assets (like your house) should be worth more.  If your wages or assets are not worth more, a central bank can lower interest rates, which should make it easier for businesses and consumers to spend money and/or borrow to expand economic activity, or it can increase interest rates, making it easier for you to save money at a higher rate than when you took out the loan.  Until 2008, the previous assumptions held mostly true.  Today, such assumptions have been proven false.

Corporations have not been spending money because the economic outlook is uncertain.  (I just saw a Bloomberg article titled, “China, Inc. Has $1 Trillion in Cash That It’s Too Scared to Spend.”) Meanwhile, central banks in export-oriented countries have actively pursued currency devaluation, an artificial way of increasing their balance sheets without adding anything of value.  The situation is so dire that even countries that want to devalue their currency, such as Japan, are unable to do so because their citizens and consumers save substantial portions of their income or do not spend at expected rates, regardless of interest rate changes.  Some banks have even played with negative interest rates and calibrated the exact percentage (about negative 1.5%) after which consumers would presumably withdraw their savings and put them under the mattress or buy tangible assets.  In short, the current American and European economic system depends on consumers buying things they don’t necessarily need even as the prices for essential items, such as housing and education, increase.  In Asia and South America, the situation is somewhat reversed. Consumer goods such as Nike shoes are very expensive relative to income, but housing is affordable outside of certain areas.  Because public or private transportation (jeepneys, buses, etc.) is relatively cheap, buying a home or condo in a smaller or less densely populated area does not cut you off from jobs or your community, though it does cost you substantial travel time.  As a result, life outside of America and Europe may require more patience, but people seem happier despite being poorer in terms of wages and legal rights.

Supporters of central banks, such as Mohamed El-Erian, claim central bank activities saved the worldwide economy as political institutions proved unwilling or unable to act.  This argument is similar to the CIA or military claiming that the only thing that matters in the end is getting things done, and sometimes, actions have to be taken in secret because of political gridlock or lack of public sophistication. Such an argument relies on the assumption that the entity acting has more information and better judgment than everyone else, which may or may not be true, but which is certainly convenient to believe. (Human beings, especially men, are more apt to overestimate than underestimate their competence.)

Like most complex issues, the answer is at least two-sided.  Yes, it is true that central banks saved the day between 2008 and 2010, but it is also true that in doing so, they prevented structural reforms that would have benefited Americans long-term.  When analyzing any claim or proposed solution, always ask: is the goal short-term or long-term success?  Will the problem recur 5, 10, or 20 years from now if we try to fix it this way? If we are asking the public to make sacrifices in the short-term that will create long-term benefits, how do we effectively communicate the strategy?  How do we promote cooperation in an age where politicians have lost credibility, even as cooperation is necessary to improve conditions in the long-term due to the interlinked nature of worldwide economies?  (Note: it is supremely ironic that the U.K. fired the first shot against globalization and cooperation through Brexit, even though it was the former British PM Gordon Brown in Beyond the Crash (2010) who most effectively and presciently stated that worldwide cooperation was necessary to resolve global trade imbalances and to resolve loopholes such as corporate forum-shopping for the lowest tax rates.)

3.  How will the "sharing" economy fit into the picture? As some countries gain greater material wealth, many of their residents no longer have to consider financial incentives as primary motivators.  In an age where the pact between employer and employee is laden with mistrust and factors beyond corporate control (such as China’s willingness to spend x money to maintain its assumed growth rate, which impacts the worldwide economy), how do we create an environment where workers have meaningful lives?  How do we also create incentives where workers are connected to their communities even as work itself becomes disconnected from location?

The above questions are crucial to answer because the American economy—which drives worldwide consumer demand—assumes people will work and willingly go in debt to buy a home (and other goods or services). What we are seeing, however, is that some people are opting out and choosing to rely on inheritances, Airbnb or Uber, or the “sharing” economy, leaving a smaller number of people contributing taxes in the way economic models expect.  (Hence, the battle between Airbnb/Uber and governments, which will probably be resolved after some level of taxation is implemented.)

The key is to ensure that agreed-upon level of taxation does not constantly increase, thereby reducing incentives to join the “alternative economy.”  Once you realize that governments and banks did not anticipate so many young people being able to opt out of the traditional economy, which reduces their taxes and loan generations, which in turn makes it harder to comply with ironclad legal agreements such as negotiated automatic COLA increases, you can see that how the battle between the new and old economic players is resolved and moderated will determine whether people truly have economic freedom.

4.  Perception vs. Reality (with TSA bonus).  A huge problem is that the things we call x no longer mean x—in practice, they lead to completely different outcomes.  Education no longer guarantees accurate knowledge, skills, or jobs.  The law doesn’t lead to justice.  Religion doesn’t necessarily lead to long-term outlooks, even though God is presumed to be infinite.  Rather than resolve legal problems such as removing incompetent workers, government agencies resort to spending taxpayer dollars to create “community relations” programs such as life-sized dolls of police officers designed to attract (brainwash?) children.

For example, in some American cities, police are stopping passengers to give them free ice cream and in doing so, are using the incidents (and unwilling participants) as free PR. One need only to look at the faces of the terrified African-American passengers stumbling over themselves to say “Sir” before one realizes several disheartening conclusions: 1) police departments are so disconnected from their communities, they actually thought stopping random minorities was a good idea; 2) police departments are so deluded, they don’t realize that the people involved probably won’t deny consent to the incident being videotaped and broadcasted to the world because they feel coerced; 3) communities are somehow not outraged over this use of police time and services, which means they either lack an easy way to be heard; think they won’t be heard even if they complain; think they might be targeted if their complaints are heard; are apathetic; or are so disconnected from minority communities they cannot empathize with their obvious fear.  In any case, all roads lead to procedure trumping substance, indicating that PR has become preferable to substantive change.

When marketing trumps actual reform, it is time to be concerned.  When marketing is considered more worthy of implementation than actual reform in a country with easy access to guns, it is time to pay attention. When marketing overrules common sense in a country where over half the population is essentially living paycheck to paycheck, it is time to evaluate the character of its people.  If all three occur at the same time…well, perhaps it is time to leave or opt out.

Even though governments are considered to have infinite lifespans and corporations can declare bankruptcy or go out of business much more quickly, in the current political climate, it appears corporations are more incentivized to think long-term because Coca-Cola wants you to drink its beverages 1,000 years from now, whereas politicians just need you to vote for them every 2, 4, or 6 years.

As a result of our strange new world, where everything seems flipped, different groups have used democratic legal systems to give themselves protection from market whims, but without any additional benefit to the public.  What is the benefit in keeping an excessively violent officer on the force? Assuming repeated and excessively violent conduct, any benefit to police officer morale is eliminated by the overall resentment and mistrust that occurs when the public realizes it is forced to pay ever-increasing taxes to maintain a culture of unaccountability.  Yet, in states where police are allowed to unionize, their self-interest continues to outweigh the public interest.  Such a scenario is shocking when you consider all the assumptions inherent in a democratic society.  The non-police public, after all, vastly outnumber the police, and the police are generally not allowed to go on strike because they are considered to provide essential services.

How did unaccountability come to rule the day?  It is partly money, but not in the way you think.  If we assume that government agencies are able to get automatic funding every year, regardless of results—and indeed, many states have passed laws that mandate a certain percentage of tax revenue go to certain departments, regardless of overall economic circumstances—then they can plan long term and can become important purchasers.  The power to divert their automatic tax revenue to specific people and companies means everyone from individuals to small businesses to large corporations needs to conform to the specific policies of the government or risk losing a bid.  (Can you now see why giving any government entity a blank check in the form of central bank printing is a problem?)

In practice, employees may favor specific companies or entities and voice dissatisfaction if a competitor is chosen for a bid, rankling the leadership, which is more concerned with morale and the status quo than improvement.  Why?  Because if the funding each year is automatic and not based on any specific metrics, the leadership is incentivized not to improve each year, but to maintain the status quo and to avoid a loss at any cost (a loss including both tangible and intangible items, such as embarrassment, etc.).  Once we realize that government entities are incentivized in a particular way, then we can easily see that censorship will be favored over transparency and accountability, especially if the avoidance of loss, such as public embarrassment, is the goal.  It’s not a difficult step to understand if censorship is more favorable to receiving automatic funding every year, with a possible increase, that government entities will lobby for special protections if transparency is pursued by the public (unique privacy rights, legal standards of discretion that are more subjective than objective, etc.) and/or will use fear to help increase tax dollars above the guaranteed minimum. It also follows that it’s easier for government entities to engage in superficial activities like “community relations” to create positive PR rather than fixing structural problems, such as removing excessively violent police officers or incompetent government workers under a unionized system where the government agencies help elect government officials both with political funding and so-called “volunteer” hours in campaign support.  What’s easier in the modern era?  Sending a few cops to your local school and paying them OT for a few hours to smile and look good, or actually trying to remove the 10% or so of the bad apples that have shown a repeated lack of good judgment?

With no real consequences for misbehavior or a lack of improvement, hubris rules the day, removing humility and creating antagonism between the government and the public it is supposed to serve.  Welcome to America, post-9/11.

(Side note: I once had a low-level American TSA worker confidently tell me his detailed scientific opinion about the safety of the new scattershot x-ray machines when they were first introduced.  I’ve traveled to at least 20 major airports in South America, the Middle East, and Southeast Asia—except for one airport, none of them use the new body scan machines.  It’s almost as if most countries are waiting to see whether the technology is worth spending taxpayer money or if there are any long-term health effects. You couldn’t convince the low level TSA agent about his lack of scientific knowledge, though—he had read something (perhaps given to him by the agency?) and appeared to be parroting it, word for word, in the most arrogant tone of voice.)

5.  Tolerance of Dissent.  Let’s follow up on the increasing intersection between government spending—much of it without any consequences for employee bad behavior or the need to improve or even deliver services or results in order to receive taxpayer funding—and its impact on free speech and dissent.

I was working in a fashion retailer HQ’s in San Francisco, California.  One day, in the publicly accessible area of the ground floor, open to everyone, the company held a security fair.  Among other participants, the FBI and SFPD showed up with freebies and brochures.  I shook the hand of the uniformed SFPD officer at his table, but the two FBI representatives weren’t as hospitable.  When I reminded them that their agency spied on MLK and missed 9/11, one of the representatives demanded to know my name—even though I was wearing an ID card on a lanyard that had my full name and picture on it.  Given the FBI’s history of spying on political dissidents, I became upset and demonstrated my displeasure by stepping backwards (to prevent any claim of physical intimidation) and flipped off the table.  Mind you, this discussion revolved around repeated failures by the FBI—a substantive political issue—and ended with the FBI representative demanding to know my name in an angry voice.  I went upstairs to get back to work, but I decided my political dissent wasn’t yet complete.  I went downstairs and stood a healthy distance from the FBI table, within sight of the SFPD table, and continued to flip off the FBI table.

Shortly afterwards, a security employee at the fashion company took me into his office and escorted me out of the building, even after I explained to him that my conduct was in response to the FBI demanding to know my name after a political discussion in a publicly accessible area.  I was almost immediately locked out of my company-provided laptop and told I could not return to the building to return the laptop, but needed to mail it in. (I returned the laptop in person anyway without further incident.)  When I contacted one of the legal counsels at the company I’d worked with—someone who ought to understand the importance of political dissent and the history of the FBI in suppressing it—he also toed the company line, showing no support for my non-violent speech, even after I explained what happened.  This might be a good time to mention the company’s advertising has recently involved rebels with tattoos and non-conformists.

Let’s recap: a company relying on non-conformist branding sided with the government rather than a minority after the government agency—known for illegal and unnecessary surveillance on American citizens even before 9/11—angrily demanded to know the minority’s name after a short political discussion.  (By the way, the security employee was African-American. I’m sure he thinks he would have supported Muhammad Ali when he was in trouble and controversial, but I think if he were white, he probably would have sided with the government. Our modern era institutions are so good at marketing, the brain can firmly believe one supports non-conformity even when one acts automatically against it.)

Again, welcome to America, post-9/11.  Such is the corrosive effect of giving security agencies in America a blank check—the amount of money involved, not to mention the possible need for security connections to get information that might not be publicly accessible due to a lack of transparency, turns most Americans into willing agents of the government without a need for direct employment or funding.  Now consider that according to The Atlantic, “Nearly half of Americans would have trouble finding $400 to pay for an emergency…[and] 55 percent of households didn’t have enough money to replace a month’s worth of lost income.” (May 2016, Neil Gabler) We can see that with so many cash-strapped Americans relying on the potential for government spending for jobs or direct employment just to survive, the democratic tilt is in favor of a repressive police state even as people believe themselves to be nonconformists.

6.  With magazines and the TV using heavy makeup and photoshop to dramatically alter one’s own appearance, it’s no surprise that ordinary people worldwide love apps that change reality. The danger is that it has become so easy to change reality virtually and artificially that our brains are fooled or diverted from wanting to actually change reality in a structurally positive way.  Even Brave New World didn’t imagine a future where people would actively alter reality to present themselves falsely to friends and strangers and then base one’s self-image on imaginary clicks or views of support.  At least soma was a tangible thing and subject to manufacturing costs that caused a direct physical reaction, not something free that relied on imagination and false pretense.  Lacking physical barriers or limitations, the latter can spread worldwide like an uncontrollable virus.

7.  Free markets in an age of foreign state-owned banks and investment.  The merging of corporate and governmental power has been called fascism, but such a label does not tell the whole story in the modern age.  Consider potash sales, which can improve crop productivity.  Worldwide, agriculture continues to represent an outsized economic sector.  (By the way, one way to see different jobs in different countries is by joining Kiva.org. In Lebanon, women often ask for loans to open beauty salons, which tells you no matter where you are in the world, dermatology and hair products will always sell.  Here’s one of my Kiva pages, in case you’re interested: https://www.kiva.org/invitedby/lawyer)

With most products, sellers negotiate a price directly with each buyer, but with potash, China has decided that it will protect its agricultural workers by acting as a de facto wholesaler. (In reality, the move protects the existing government because many Chinese citizens work in the agricultural sector, and China is wisely pre-empting internal strife by taking care of its rural citizens and keeping an eye on food inflation, an issue India and Thailand have not yet mastered.) As such, China requires foreign potash sellers to negotiate a single price for the entire country in order to do business, which provides its farmers with a substantial discount and also sets the benchmark for price negotiations with other entities, including large private companies and other countries like India.  In contrast, American farmers and companies presumably have to buy potash through distributors (aka middlemen), which obviously creates an additional markup on top of the higher price paid due to the lack of a nationwide discount based on volume.  In short, American farmers are at a disadvantage because their federal government does not negotiate directly with potash sellers and instead allows the “free market” to set the prices, which is misleading, because the free market is now being influenced by another government’s actions.  Funny thing about “free markets”—they’re easily influenced by major players who don’t have incentives to stay within the same system as everyone else.

Even if you’re the most ardent free market capitalist, you can see that the American government standing still disadvantages American farmers, who then resort to domestic lobbying to get benefits such as ethanol subsidies at American taxpayer (and nutritious) expense.  The federal government might retaliate by restricting Chinese agricultural exports, but such legal wrangling on the international level is of limited value because a) China can sell its food products to another country, which can easily remove or ignore origin labels and re-sell it to U.S. consumers (at a markup, of course); and b) major countries sell so many products to each other that protecting one sector could lead to equivalent retaliation, which, if not contained, could harm everyone.  (P.S. Globalized trade is also why economic sanctions don’t work, unless you’re trying to deny medical supplies to kids in Iraq, which is basically what the U.S. ended up doing during Saddam Hussein’s reign, bolstering arguments that the U.S. is immoral.)

So what do we do when globalization and the “intangible” services economy have upended established economic theories, leading to voter backlash against academic elites?  Most people don’t know that government spending as a percentage of GDP is not much different in America than in so-called socialist countries like Sweden.  In America, government spending in 2013 was about 40% of GDP; in Holland, it was about 46%; and in Sweden, it was about 52%.  Setting aside obvious differences in population size, poverty, and diversity, Swedes receive fully or almost fully subsidized education, including college, and healthcare, whereas Americans are often in personal debt to receive such services.  Of course the Swedes pay more in personal taxes, but in general, after taking a 401(k) and/or a mortgage deduction, most Americans making less than 125,000 USD annually will not pay more than 25% a year in income taxes.  In short, an 11% differential in tax rates cannot explain the vast differences in government services.

Thus, the key is to focus on how tax revenue is distributed rather than tax rates themselves; then whether it is used efficiently; and finally, whether it is accomplishing its stated purpose.  No single voter or government official or even several of them acting together can do that—cooperation is required across local, state, government, small business, and multinational players.  In other words, in an era where more cooperation is necessary to make America great again, America has never been more fractured in spirit.  Throw in the fact that Americans today are more than willing to antagonize others for no reason other than because they can, and we have guaranteed American decline in a world where other countries’ governments are acting carefully and in ways that maximize their advantages in concrete, practical, and tangible ways.

(Note: cooperation does not and should not mean sacrificing one's independence.  Local entities and their residents should be wary of cooperation that looks more like partnering or a merger than knowledge transfer or sharing expertise.)

8. Patriotism and unity. What “coming of age” rituals can Americans (and other countries) agree upon, or should such rituals be restricted solely to the private sphere?  On this topic, I have very little to add.  I personally credit high school wrestling with my own coming of age, but I also know each person’s experience with sports is different.  Yet, I am troubled by the contrast I see between Americans and Thais, Brazilians, and Filipinos.

Thais, Brazilians, and Filipinos are some of the most diverse people you’ll ever meet.  A Thai could have brown or light skin, or be of Indian descent; Filipinos are mixed with Chinese, Spanish, and Malay; and the best second passport is a Brazilian one because Brazil has Anglos, Lebanese, Chinese, Japanese, Portuguese, and everything in between, so there’s no “Brazilian” look that will attract attention at airports (unlike a Chinese traveler with a Russian passport, for example).  Somehow, everyone I’ve met from these countries is united and proud to be associated with their country (though not necessarily their government) to the point where most get offended if you ask them if they’re actually Thai or Brazilian.  They always make a point to vehemently reiterate that they’re from the country even though their grandparent was full Chinese. How did three countries more diverse than America (outside of a few of America’s major cities like NYC) end up becoming much more inwardly and quietly patriotic, with overt displays of patriotism such as flying the national flag less common? (I’ve noticed that in countries where citizens fly their national flag more often, there is more division and less unity.) I don’t know the answer to this question.  Someone should study it.   It’s not just the three countries I mentioned, by the way.  Colombians, for example, will give anyone a run for their money when it comes to national pride.

9.  Multiplexity--my definition. Any modern root cause analysis of problems contains “multiplexity,” or multiple reasons and causes creating complex outcomes (my term, as far as I know--not the standard definition).  For example, I met a Filipina in the Philippines and asked about her son.  She had met an Aussie miner several years ago, during the mining boom caused by China’s infrastructure spending, and she fell in love. Unfortunately, the Aussie miner disclaimed her child until after she took a DNA test, fracturing the relationship.  I asked her what future she hoped for her young son.  She said she hoped he would become a football player.  I asked whether she read to her child regularly.  She said she had heard it was a good idea, but she relied on the television to teach him English.

I take two main points from my conversation with her.  First, TV and social media’s pervasiveness have made outrageously unlikely outcomes—such as becoming a professional football player—seem normal.  Second, the child exists because of Chinese infrastructure spending and some central bank somewhere changing interest rates in ways that made gold more expensive, which put more money in the Australian mining community.  Yet, you’d never look at the kid and think he exists because of a bank's decisions or foreign government spending—even though he does.  Multiplexity is real, even though it is often invisible.

10.  Teamwork.  One of life’s ironies is that liberals tend to create well-meaning programs without thinking of the way they can be “gamed” and made financially unsustainable by a small percentage of bad actors; as such, programs would often be best implemented by conservatives.  Such a potential merging of different skill sets to create an ideal match is probably why political differences have survived in people.  Take Warren Buffett and Charlie Munger, for example.  Buffett is liberal, Munger is conservative.  Would either of them be anywhere close to their success today without each other?

11.  Overconfidence in data.  It seems like everyone these days is interested in psychology.  Yet, so many of psychology’s conclusions rely on incomplete data.  For example, let’s say I do an experiment with Lindt chocolate, which is generally much more expensive than Hershey’s chocolate.  Such an experiment would probably involve fewer than 3 dollars a transaction or perhaps as little as 25 cents.  A psychologist may arrive at interesting data after comparing demand between the two chocolates side by side at different prices, but the experiment won’t account for substantial differences in the buyers’ emotional states.

If just 10% of the buyers are active investors in the stock market, and the market went up 5% that day, they may be more inclined to buy the more expensive chocolate, and the reverse if the market went down 5%.  Moreover, it’s possible the amounts in question are too small to be meaningful.  For instance, if someone is trying to scam me out of a dollar, I may just give him the dollar to maintain the peace.  How would any psychologist determine whether I am being gullible by pretending not to know I’m being scammed, or making a cost-benefit analysis? In most experiments of this nature, there is no way to accurately separate all the factors in a person’s head and isolate the primary one. (Another result of multiplexity.) As such, most psychology after general conclusions is often worthless.  Indeed, if psychology’s generally accepted conclusions interfere with one’s ability to analyze or address individual problems on a micro-level, they may actually create more negative than positive outcomes, despite being true in the abstract.

Personally, I’m interested in the following issue: it’s clear that the best way to get most people (non-con-artists) to provide unbiased information is to pretend to be dumb. (I always rely on women if I want unbiased information, because they all understand this tactic, even if they don’t use it.)  In doing so, however, one sacrifices credibility and the opportunity to lead the person or his friends, at least in the short-term. What is the best way to reconcile these two competing factors?

12.  Possible solutions. I have some general ideas that may help improve some of our problems:

a.  Have economic incentives, not profits, dictate corporate performance.  We tend to say, “Do what you love, and the money will come,” but somehow ignore this advice when it comes to encouraging corporate employees and the level of discretion given to them.

b.  Stop blindly implementing backward-looking policies.  It’s not just pension funds that refuse to budge from 8% assumed annual investment returns—the problem is often much less political, but passive acceptance of nonsensical policies tends to creep into other areas of thinking.

When I travel, I often buy one-way airline tickets because I’m not sure how long I want to stay in a new country. The current travel system is set up to force airline check-in employees to input a destination after the landing or deny check-in because of the small chance that the destination airport will deny entry to the traveler.  The discretion to reject a traveler without an ongoing destination is because the traveler may overstay his or her visa and work illegally and also because criminals have been known to use one way tickets.  Yet, there is no way an airport employee with half a brain will be able to look at my well-used passport and my bank account (accessible on my phone) and believe I would be a burden, financial or otherwise, to any destination country.  I’ve gotten into arguments with airport staff because I know procedural loopholes they don’t, but my real frustration comes from people not realizing our quality of life will diminish considerably if customer-facing employees and their supervisors do not know the reasons behind the rules and are given the discretion to modify them when needed.  In an age where rules can be accessed on anyone’s phone, why don’t more companies and governments make it easier to find rules and their exceptions and empower their supervisors to interpret them?  (Richard Branson's companies have been successful precisely because of a flexible management style.)  Do we really want to have a society where any non-standard response must be vetted by lawyers and risk managers, who are often based in locations far away from the day-to-day action?

c.  Stop using outliers as the basis of any policy.  One terrorist tries to detonate a bomb in his shoes, and everyone traveling needs to remove his or her shoes (as if criminals aren’t capable of changing tactics).  One criminal uses one-way tickets to minimize detection, and governments implement rules to discourage one-way tickets (even though any idiot wanting to bypass this rule could buy a multi-leg, roundtrip ticket and leave at an earlier stop).

It’s easy to see that entities relying on the perception of maintaining safety would be incentivized to over-regulate rather than give employees discretion, especially when disparate treatment often results from unconscious bias.  Yet, as lower level functions become automated, the main values human employees can add to any organization are common sense and the ability to use discretion wisely.  To encourage such value, companies need to demonstrate more loyalty to their employees and give them more opportunities to be visible to upper management.  One Japanese owner may have the right idea—he tells his employees they won’t ever be terminated because they lack talent, but in exchange, they must work hard.

Conclusion: as private and public entities with more power over our lives become larger, they tend to use top-down rather than bottom-up management.  People are frustrated because they are not seen as individuals.  The advent of social media and the influence of television have made everyone’s lives more difficult by increasing the level of biased information and of broad (and therefore useless) data, while decreasing the time dedicated to contextually complete and nuanced information.  Everyone is convinced they are correct and honest even if they see only one area of a picture; yet, in an era of multiplexity, it is more likely that people are wrong than right. Whether people begin to realize their perspective is limited, despite the vast amounts of information available to them, will determine whether the human race prospers.

Lawrence Ferlinghetti once said, “It seems that mankind is too stupid and greedy to save himself.” He was referring to ecological annihilation, but his statement sadly applies to many more areas. Perhaps humankind isn’t too closeminded to save itself from people who insist on using fear and complex legal maneuvers to drive their version of progress. Time will tell whether we can reverse our current path. We’ll have one indication of our direction in the November 2016 elections, and another indication when or whether Congress reverses its long-standing reliance on appropriations to fund military adventurism and expansion.  Will the world be driven by countries needing to buy hundreds of billions of dollars of advanced weapons each year, or will people finally demand that politicians work together to advance cooperation on both micro and macro levels? Multiplexity demands either increased worldwide cooperation, increased segregation, or decreased size.  Only one of those options encourages a world with reduced conflict and fewer misunderstandings.

May the odds be ever in your favor.  

Adventures in Travel (2016)

America is in decline, and everything will be okay. Let me explain. Donald Trump and Hillary Clinton as presidential candidates look terrible, but not when you understand why they’ve become the nominees. Trump’s rise is easy to explain—he's the personification of anti-political correctness and doesn't talk down to non-coastal Americans despite being from New York City. Uneven federal government spending and concentrated corporate technological and VC investment has helped shift affluence, influence, and higher-paying jobs to coasts and larger cities instead of smaller or non-coastal ones, and no one likes feeling unappreciated in today's winner-take-all economic battles. Moreover, Trump voters aren’t all racists or xenophobes and resent being seen as such. A typical Trump supporter may be anti-immigration but may base his or her opinion on valid prima facie data, such as the increase in prisoners from various groups that are immigrants or recent descendants of immigrants.

My conversations with GOP voters revolve around immigrants changing the character of their communities and the federal government doing little to help. One perception is that illegal immigrants receive welfare or “free stuff”; and secondly, that newcomers cost more than native-born Americans, whether by diverting school resources to ESL programs not used by their children or their neighbor’s children, or by requiring more work to be done by existing police and jail employees but without additional tax revenue. Globalization is also an issue in cities that have lost manufacturing jobs, but it’s really the feeling that China is getting the better end of trade deals that riles up the conservative base. To summarize, Trump is winning because the Establishment and younger Americans have either ignored valid complaints from conservative voters or unfairly decided that such complaints are the result of bigotry or ignorance. See, for example, the book titled, What’s the Matter with Kansas? (Which causes me to think, “Nothing. Who wouldn’t want to live in Lawrence?”) “You may not listen to me,” a Trump voter might say, “but you cannot ignore Trump.” 

Now, it is true that cities with immigrants, both legal and illegal, have experienced more economic growth than cities without them. It is also true that the illegal immigrants’ American-born children receive welfare, not the illegal immigrants themselves. The positive impact of immigration on economic growth is not restricted to American cities like San Antonio, New York, or San Jose—Toronto’s private sector working population may be 51% immigrant. What some liberals fail to consider is whether the average Midwesterner or Southerner wants to pay 650,000 USD for a townhouse in a so-so K-12 district, wants to live around neighbors who don’t share his religious values, wants to see his son working as a lawyer rather than a machinist, or wants to see his daughter delaying motherhood until her 40s because two incomes are necessary to buy a home.  (Even coastal voters are starting to acknowledge the problem of constant inflation in essential goods and ever-increasing productivity—witness comedian Ali Wong joking, “I don’t want to ‘lean in,’ okay?  I want to lie down.”). At the end of the day, when you ignore or mischaracterize complaints, there will be backlash. Hence, the rise of Trump. 

What of Hillary Clinton, then? Her rise to power is a logical extension of the Democratic Party's platform: safe positions that provide the perception of diversity and social progress. When you’re winning eight years straight, and your opponent is throwing Hail Marys, there’s no need to rewrite the playbook.  Even the so-called Affordable Care Act required so much compromise, it ended up being a boon to the most powerful lobbyists in D.C.—insurance companies. Younger voters, of course, will get the shaft—they’ve been getting shafted in almost every democratic country in the world, as high schools and colleges fail to teach economics and basic finance properly and as populations age and senior citizens vote consistently, causing tax revenue to shift to government-provided medical care and retirement programs. 

Meanwhile, what’s a top concern for voters in their 30s and 40s in industrialized nations?  Subsidized childcare. You’d think such a request would be easy enough to implement--after all, how hard can it be to pass several individual and childcare provider tax credits?--but you’d be wrong.  As young couples marry later and have fewer children, they don’t have a strong enough voting bloc to be given substantial attention at the political table. Call it the “Curse of Reasonableness,” but studied, incremental reforms require nuanced perspectives and knowledge of the law of unintended consequences, which don't get much play in the age of Kardashians, the six-second Vine, and the Pokemon Go app. If you’re a Democratic politician, are you going to attract attention by promising childcare tax credits or free college tuition? 

That word, “free”—did you see it?  “Free stuff.”  It’s tantalizing, yes? A conservative voter will argue nothing is free. You have to divert tax revenue from existing services if you add new ones; reduce morale by asking government employees to work more for the same pay (in California, during particularly difficult budget negotiations, some government union employees openly bragged about slowing down non-essential work); and/or raise taxes, almost all of which eventually come out of middle class voters’ pockets, because the rich have lawyers and bankers whose jobs revolve around finding loopholes to protect their clients. (Note: using debt to fund government services delays while guaranteeing eventual tax raises and/or uneven inflation.) 

If you’re a liberal voter, you’ll probably respond with arguments about income inequality, actual rather than posted corporate tax rates, the 1%, etc.  Even if you’re right, it doesn’t matter, and it won’t change the fact that about half the country doesn’t care as much about effective corporate tax rates as they do about attracting more jobs while making sure they can pay similar taxes on their house today as they did ten years ago while preventing haphazard social development that changes their community’s character. As I like to tell Californians who don’t own Teslas, “You may look down on Southern conservative voters, but where do you think your car was assembled, and by whom?”

Underneath the Democratic Party’s lofty words and promises is a need for tax revenue and job growth.  First, those pensions promised to teachers and government union workers?  They have an assumed interest rate (or growth rate) established by politicians, usually around 7.5%. Look up where you can increase your assets 7.5% a year, and the correct answers will take you to the stock market and hedge funds, both of which lead you straight to Wall Street.

Second, no political party can escape political reality, which is that if the economy is doing well, the incumbent wins. How are jobs created in the 21st century? Through debt, which has come from central bank printing. That’s why Hillary Clinton is in bed with the big banks and multi-national corporations, and that’s why Bernie Sanders never stood a chance. If you live in a mid-sized city where you’re happy with your local mid-sized bank or credit union that keeps its own mortgages; content to see your daughter married at the age of 26 (maybe even with grandchildren already); and realize one reason Walmart invested in your community and created jobs, including well-paying managerial positions, is because of fewer regulations and lower corporate taxes (one Indiana resident with whom I spoke called the new Walmart the "new downtown"), then why would you vote for Hillary Clinton? If you think fewer regulations necessarily lead to a race to the bottom, consider that Walmart executives may have better reputations than Congress. (Stated another way, do you trust Apple's Steve Jobs to make the right decision, or Iowa Rep. Steve King?) What about abortion?  If you want one, you can find a job at Walmart and fly to California or New York to get it. As for freedom, it’s not just about the 2nd Amendment—as economist Nassim Taleb writes in Antifragility, “[W]e have never been more in debt ([and] for the ancients, someone in debt was not free, he was in bondage.”) 

In short, both Clinton and Trump are extensions of legitimate political positions. Side A is tired of not being heard, while Side B chooses to hear nothing but bigotry. I started this essay by saying America was in decline, and I hold that position. What has changed is that it no longer depresses me. Cities will stay segregated as voters focus more on observable racism than poverty and segregation as root causes of violence. Tax revenues will fluctuate and continue to be uneven nationwide. Central banks will continue papering over structural problems. Lawyers will continue to find loopholes, both legal and illegal, for their clients. Yet, there is value in realizing both presidential candidates, though far from ideal, are extensions of the current political climate, because it means America has not gone crazy—it’s just lowered its expectations. Expectations can be modified, even if it takes another 50 to 100 years. As optimists such as Warren Buffett have written,

“Indeed, most of today’s children are doing well. All families in my upper middle-class neighborhood regularly enjoy a living standard better than that achieved by John D. Rockefeller Sr. at the time of my birth. His unparalleled fortune couldn't buy what we now take for granted, whether the field is, to name just a few, transportation, entertainment, communication or medical services. Rockefeller certainly had power and fame; he could not, however, live as well as my neighbors now do. Though the pie to be shared by the next generation will be far larger than today’s, how it will be divided will remain fiercely contentious. [Italics mine.]  Just as is now the case, there will be struggles for the increased output of goods and services between those people in their productive years and retirees, between the healthy and the infirm, between the inheritors and the Horatio Algers, between investors and workers and, in particular, between those with talents that are valued highly by the marketplace and the equally decent hard-working Americans who lack the skills the market prizes. Clashes of that sort have forever been with us and will forever continue. Congress will be the battlefield; money and votes will be the weapons. Lobbying will remain a growth industry.” [2015 Berkshire Hathaway Shareholder Letter]

One can recognize the absence of psychological well-being (apart from material comfort, anyway) in Buffett’s equation and still appreciate his realism. What does this mean for me, a U.S. citizen and American immigrant who recently told someone, “I hate America,” shortly after police shot and killed an unarmed Philando Castile?  It means I no longer expect as much from America, but just because America has become older and less sturdy, it does not make her less beautiful.  If Tokyo can be the most prosperous city I’ve seen in my travels, despite Japan’s debt-to-GDP ratio of 220%+, perhaps government debt, on its own, won’t cause a country to collapse.

Maybe we’ll adapt, even if it means more segregation, less immigration, more cross-border violence, more divorce, more student loans, more single parents, more incompetent or unaccountable government employees, and more unaffordable housing.

Maybe on the way down, we’ll re-evaluate what it means to have honor as an American.

Will a commonly agreed-upon definition of American honor include the ancient Mediterranean ethic, Factum tacendo, crimen facias acrius? ("He who does not stop a crime is an accomplice.")

Or will we adopt a more modern version of honor similar to George Meyer’s, as related by Adam Grant? "(1) Show up. (2) Work hard. (3) Be kind. (4) Take the high road."

Or maybe cowardice rather than honor will be enhanced by technology, as “society is fragilized by spineless politicians, draft dodgers afraid of polls, and journalists building narratives, who create explosive deficits and compound agency problems because they want to look good in the short term.” (Taleb)

Despite everything, it's possible things will work out just fine, even as living spaces become smaller, consumerism and materialism continue to rule the day, and countries erect more barriers against foreign workers but not foreign capital.

As for me, I’m going to keep traveling.  I’ve been to 10 cities in the past four months, increasing my lifetime “countries visited” count to about 30.  I’ve decided the world is based on academic assumptions that no longer apply, but which have prevailed in large part because central bank spending has maintained the status quo.

For example, most economic theories and approaches are from times when tangible products ruled the day rather than services, which are more difficult to track, more easily manipulated, and more subject to cross-border competition. From Adam Grant: 

“In the 1980s, the service sector made up about half of the world’s gross domestic product. By 1995, the service sector was responsible for nearly two thirds of world GDP.  Today, more than 80% of Americans work in service jobs.” 

Of course, fraud and manipulation occurred regularly in the “analog” world, but the tangible has limits and leaves traces.  (One banker was fooled into guaranteeing a loan to a business by inspecting only the top of a vegetable oil tanker—the rest was water.) Still, there’s an upside to our rapidly changing world: even if you didn’t go to college or pay attention in high school, it may not matter in the long run—the information being taught might be outdated and therefore inapplicable to your life. 

My most interesting conversations have been with women. Educated women worldwide are quietly rebelling against traditional expectations.  (If I faced the prospect of coming home to a man who was content with drinking beer while watching a baseball game, perhaps I’d go shopping more and stay single, too.)  It’s easy to see the future will belong to societies that achieve higher female participation in politics and business through merit-based factors while encouraging career-oriented women to have children.  Whether this means more subsidized childcare, a greater appreciation for introverts, tax credits for each child, and/or social pressure on men to do more housework, I don’t know.  I do know, however, that current and future economic forecasts are based on women continuing to have an average of two consumers—er, children—and those children receiving adequate educations and stable living environments that discourage violent behavior.  Ideally, those two children would not be latchkey kids and would attend college and not graduate with crushing debt and non-existent practical skills, but from what I’ve seen, many educated women are not going to comply with all of the above assumptions. If uneducated women in poorer countries have more children over the next 100 years than educated women in richer countries, and public education systems are not reformed to increase practical and critical thinking skills, we could be looking at a world where we have a few Japans selling products to the rest of the world, or we could be looking at land and water needs and disputes controlling international relations. There are many in-between scenarios, but none likely without more segregation and walls.

Let’s hope we figure out how to appreciate ambitious, career-oriented women and not end the human race in the process. As the folk wisdom goes, “If momma ain’t happy, ain’t nobody happy,” but what happens when there’s no mommas left, or they’re mostly in some countries but not others? 

I’m single, 38 years old, debt-free, and childless.  I’ve decided that my new criterion for a relationship is whether a woman believes in character and whether she has it herself.  In the modern world, where everything is negotiable and where outcomes are unpredictable, only character will remain the true constant.  I’ll be visiting Canada and Australia at some point in my travels.  As Paul Coelho wrote in The Alchemist, “[W]hen you want something, all the universe conspires in helping you to achieve it.” 

 I'm going to find out if he's right.

© Matthew Rafat (2016)