“Extreme” abortion laws

You know the story: Alabama, Georgia, Missouri and other states are competing for the strictest anti-abortion laws in recent memory. “Heartbeat bills” are rising, and millennials and younger that grew up only knowing the safety of Roe v. Wade fear its inevitable overturn. Pelosi clarifies that one does not have to be pro-choice to run Democrat. The pot of left-of-center young adults that gradually bubbles socialist renounces centrism for failing to fight this reinvigorated war on women and reproductive rights. The leftists want to kill more children, and face no timely restrictions at all on turning their womb into a uterine death chamber. Also, this is all Trump’s fault.

Or so everyone is saying about each other.

Of all the hot issues where the principle of charity is ceremoniously burnt alive in public theater, abortion stands out as the most sulfuric: “old white Christian men” want to “control women’s bodies” and make them “sexually subservient to the law” by “setting us centuries back”; alternatively, “irresponsible juveniles” want to “have sex without any consequences” by getting “abortion on-demand” and “killing babies at will.” In reality, the pro-life camp is a wide demographic pool, male and female, theist and atheist, old and young, white and not, that doesn’t give a fuck about what you do — in fact, they really seem to just not want to hear about it — as long as you’re not killing children (in their eyes), and the pro-choice people are motivated, in their most vocal advocates, by stories not of free love and reckless abandon but horror, shame, pain, trauma over their experiences with abortion in its current shackles… (in their eyes).

People are good, mostly, but the most antagonistic and moronic take the spotlight instead of the good faith representatives. Abortion is a debate between two people that hate each other but don’t have a shared language to reconcile their differences. And like the rest of political warfare, the fractures build new pits in the bipartisan schism; if abortion is Ares, then racism and sexism are its Phobos and Deimos.

Although I lean heavily on the side of choice, my peers expose their bubble by labeling some of the recent proposed litigation as “extreme.” None of it is extreme with sympathy to the opposing worldview. To the other side, we, the people with “the right ideas,” have had it extremely in our favor for a long time.

Texas recently introduced a bill transitively allowing the death penalty for women who get abortions (by allowing the conviction of homicide, which can be issued the death penalty in Texas). The pro-choice reaction to this is disbelief, a harbinger of a new Dark Ages, domestic terrorism by conservatives: extremism. I had a fruitful conservation on Facebook about the fringeness of this belief. It’s not fringe of a position at all, accepting basic tenets of the pro-life philosophy.

Anti-abortionists consider abortion to be murder, and thus their reaction to abortion should, logically, be consistent with their reaction to murder. This should be true for moral and legal questions both before and after abortion. Opposition to the death penalty is mostly about jurisprudence — it takes in many factors that supervene on a million things without the slightest relation to abortion — but moral equivalencies are not.

So, IF abortion is homicide, and IF homicides can be justifiably prevented by killing the would-be murderer, THEN abortions can be justifiably prevented by killing the abortion doctor or mother to intervene.

Further, IF abortion is homicide, and IF homicides are morally punishable with the death penalty after due process, THEN abortions are morally punishable with the death penalty in the court of law.

It’s not necessary to be pro-life and require the death penalty or self-defensive killing when it comes to abortion, but it is consistent with other basic premises that many people hold. It is not extremist.

Now, there can be lots of exceptions to the conditional premises above (killing to prevent a homicide might not always be justified, etc.), but I sincerely doubt pro-lifers accept the common ones — e.g., if I wanted to kill my vegetative spouse because I don’t feel like I could take care of her, that won’t earn me any sympathies and, consistently, should not in the analogous case of abortion (accepting the premises above…).

More pro-life people should, therefore, argue the morality of murdering abortion doctors and would-be mothers; they should also see the death penalty as reasonable if they think the death penalty is already reasonable in the case of mens rea homicide. Abortion, if murder, fits homicidal criteria like premeditation, etc. If someone who is pro-life disagrees that he needs to take this stance because the question of abortion is so socially conflicted, then it probably means he himself is actually conflicted.

Posting thoughts on abortion should be more like encouraging discussion and less like summoning Cenobites. The “extremist” pro-life position outlined above that has started to surface is not “extremist” at all; it’s part of a consistent Weltanschauung completely different than mine own. The more accepted view, the Roe v. Wade decision, appears extremist to the others.

We should all seek to understand our interlocutors as fellow pilgrims on the same journey toward truth, all of us stuck applying archaic moral and scientific categories onto new problems of autonomy, all of us quietly trying to pass a conch while the megaphone of Twitter opinion screams on. Maybe the above conclusions place pro-life into a reductio, or maybe it prompts pro-choice into a more “extreme” logical position to counter. Either way, we’d be better for it, seeing each others’ views as parts of a foreign and strange, but concrete, whole, instead of the fevered, conspiratorial plans of a hostile enemy.

Liberalism & Jewish Emancipation

Crossposted at Liberal Currents

How did religious freedom first emerge? This is the theme of Persecution & Toleration (CUP, 2019). Here I focus on one part of this question: how did Jews obtain civic rights?

Antisemitism has a long history in Europe. Elsewhere, I discussed its institutional foundations in the Middle Ages. But even as pogroms and antisemitic violence waned, disabilities and restrictions on Jews remained in place. It was not until the 19th century that most were removed in Western European countries. In Persecution and Toleration, Noel Johnson and I argue that this discrimination reflected the political economy of fragile states. Religious freedom was impossible in weak states reliant on religious legitimacy. But this doesn’t answer the question: How did this discrimination end? How did we get religious freedom?

The struggle for Jewish emancipation was a long one. When it finally took place it was closely associated with the emergence of modern liberal states. It was only once the institutional basis for political authority had changed that granting Jews full civil rights became feasible or even conceivable.

Here I will focus on the removal of Jewish disabilities in England. And in particular, I’ll focus on one paradigmatic statement of religious liberty that Thomas Babington Macaulay made in Parliament in 1829 in favor of ending all civil disabilities on Jews. As a statement of religious freedom and liberalism more generally, it is sadly neglected.

Jews faced restrictions on their ability to settle, reside, work and practice their religion in all European societies before 1800. These societies were governed by religion-based identity rules, rules that treated individuals differently based on their religious faith. Britain was relatively liberal; when Jews settled in England following their invitation by Oliver Cromwell in 1655, they were free of most of the discriminatory legislation that burdened them across continental Europe. In particular, they were free of the onerous residency or marriage restrictions that burdened many communities. Nevertheless, they were excluded from political power and from occupations such as the law, government service, and the universities. They lacked religious freedom.

Attaining full religious liberty was a decades-long struggle. Even after disabilities were removed from dissenting Protestants and from Catholics, there was opposition to allowing Jews to sit in Parliament, to graduate from Oxford or Cambridge, or to serve as judges.

Understanding where this opposition came from one requires appreciating how religion upheld political order, even in a society as apparently modern as 18th-century England. Restrictions on dissenters, Catholics, or Jews did not only reflect simple prejudice. Britain was a Protestant nation. Loyalty to the state was inseparable from loyalty to the Protestant Settlement of 1689. The Church of England was a bulwark of the Constitution. Privileges and economic rents were monopolized by the Anglican elite. Catholics, Methodists, Quakers, and Jews were tolerated — they were largely free as private citizens — but they were kept away from political power.

Overturning this required a new basis for political authority. As discussed in an earlier piece on Catholic emancipation by the early 19th century the threat of militant Catholicism had receded while the Church of England was itself a diminished force. Meanwhile, the narrow oligarchic post-1689 settlement was being challenged. British elites were forced to reimagine the sources of political legitimacy.

One of the first to do so was Thomas Babington Macaulay (1800–1859). As an MP, Macaulay was an establishment figure and no radical. But the view of government he laid out was fundamentally different than what had animated his predecessors. It was a secular and liberal view of the role of the state, in which identity rules based on religion had no place. It was in his view only “because men are not in the habit of considering what the end of government is, that Catholic disabilities and Jewish disabilities have been suffered to exist so long”.

“We hear of essentially Protestant governments and essentially Christian governments, words which mean just as much as essentially Protestant cookery, or essentially Christian horsemanship. Government exists for the purpose of keeping the peace, for the purpose of compelling us to settle our disputes by arbitration instead of settling them by blows, for the purpose of compelling us to supply our wants by industry instead of supplying them by rapine. This is the only operation for which the machinery of government is peculiarly adapted, the only operation which wise governments ever propose to themselves as their chief object.”

Macaulay is outlining a liberal, non-heroic, instrumental, view of government. The state is not a project or painting; it is a mechanism for resolving disputes peacefully and facilitating social cooperation. It is a tool meant to serve specific practical purposes rather than a religion or work of art meant to fulfill a symbolic or spiritual need.

Accept this liberal view of the state and the rest of the case for religious freedom follows. As Macaulay put it:

“The points of difference between Christianity and Judaism have very much to do with a man’s fitness to be a bishop or a rabbi. But they have no more to do with his fitness to be a magistrate, a legislator, or a minister of finance, than with his fitness to be a cobbler. Nobody has ever thought of compelling cobblers to make any declaration on the true faith of a Christian. Any man would rather have his shoes mended by a heretical cobbler than by a person who had subscribed all the thirty-nine articles, but had never handled an awl. Men act thus, not because they are indifferent to religion, but because they do not see what religion has to do with the mending of their shoes. Yet religion has as much to do with the mending of shoes as with the budget and the army estimates. We have surely had several signal proofs within the last twenty years that a very good Christian may be a very bad Chancellor of the Exchequer.”

Why did this argument, which seems natural to us, shock Macaulay’s contemporaries? Israel Finestein observed that in “their view it was precisely the religious difference which unfitted the Jew to be a legislator in a Christian country. To them, Macaulay’s argument was dogmatic, even irrational and certainly question-begging”.

Herbert Butterfield observed that

“Those who are interested in the way in which liberty came to emerge will find themselves safeguarded against certain types of error if they will keep in mind that they are looking at the actions and purposes of men as these appear in retrospect — they are making their observations from the hither side of a great transition” (Butterfield, 1977, 574).

Macaulay’s liberal view of the state made sense only on the other side of this transition. It presupposed a state that had moved from religion-based identity rules to general rules.  And this transition, as we discuss in Persecution and Toleration, is the bedrock of modern liberal society.

Of course, once emancipated Jews excelled in numerous fields of endeavor and European society at large reaped huge economic and cultural benefits. Emancipation also had a transformative effect on Jewish communities themselves, giving rise to both the liberal Reform Judaism movement and to various strands of Orthodoxy.  But emancipation also provoked a backlash.

Though the transition from identity rules to general rules and the attendant rise of modern liberal societies and of economic growth brought huge net benefits,  there were many losers – individuals who lost relative status as industrialization reordered the economic order.  Many blamed the Jews, who were seen as the greatest beneficiaries of the new liberal order.

Modern antisemitism arose in the late 19th century just as the last restrictions on Jews were being removed.  In Bavaria, for instance, emancipation was opposed by a petition of citizens from the town of Hilders who did not wish to “humble themselves before the Jews” (Hayes, 2017, 23).

Liberalism has remained resilient in countries like Britain or the United States where its institutional and cultural foundations were strong, but it is not irreversible. To preserve these foundations it is helpful to remember where they made. From that perspective, the case of Jewish emancipation is both instructive and cautionary.


Butterfield, Herbert, “Toleration in Early Modern Times,” Journal of the History of Ideas,
1977, 38 (4), 573–584.

Finstein, Israel “A Modern Examination of Macaulay’s Case for the Civil Emancipation of the Jews.” Transactions & Miscellanies (Jewish Historical Society of England), vol. 28, 1981, pp. 39–59.

Hayes, Peter (2017). Why? Explaining the Holocaust. W.W. Norton & Company, New York.

Johnson, Noel D and Mark Koyama. Persecution and Toleration (Cambridge Studies in Economics, Choice, and Society) ( Cambridge University Press.

Thomas Babington, Lord Macaulay, Critical and Historical Essays contributed to the Edinburgh Review, 5th ed. in 3 vols. (London: Longman, Brown, Green, and Longmans, 1848). Vol. 1

Bourgeois III: Values in real-life

Today, there is a rising commercialization, a commodification of the character traits of the bourgeois. This in turn is leading toward a worldview in which bourgeois behavior is a “privilege,” instead of simply being an expectation of a civilized society. As part of such a change, the bourgeois, the real middle-class as exemplified by a set of genuine values and behaviors, not just income or the terrible Marxist clichés from authors such as Christina Stead (The Man Who Loved Children), have moved from being the group of idealized role-models to being portrayed as a slightly deviant clique. Now, words such as “censorious,” “sanctimonious,” “privileged [again],” “hectoring,” and “judgmental” are routinely thrown around concerning those of bourgeois persuasion by pundits and the commentariat on both sides of the political aisle.  

In 1960, psychologist Dr. Walter Mischel led the famous (or infamous depending on social leanings) marshmallow experiment. A young child, observed by researchers and parent(s), was left alone in a room deliberately devoid of stimulation outside of a candy marshmallow. The researcher who took the child into the room would tell the child he/she could eat the marshmallow but would promise a gift of two marshmallows if upon the adult’s return two minutes later, the original piece of candy was uneaten. Needless to say, once the researcher left the room, the majority of children promptly ate the thing. 

Mischel checked on them when they were teenagers and then located a smaller segment when they were almost 50 – those who had displayed deferred gratification had more successful lives than those who had gobbled the first marshmallow. Starting in 1990, when Mischel published the results of both the original test and the teenage checkup and revealed that those with self-control had achieved higher SAT scores and therefore received admission into the best universities, his work came under fire from the social justice coterie. The reason was that the results were an indictment of the difference in the parenting style of the majority, i.e. the single marshmallow gobblers, and the disciplined minority. In a logical world, the results should be cause for celebration because the two-marshmallow children came neither from a racially homogenous group nor from elite backgrounds, though the fact that the majority had one professional parent has formed a large part of “but the experiment is socially discriminatory” argument. 

The crux of the rejection is the evidence that the two-marshmallow children entered the experiment room having already learned self-control from their parents, while the candy wolfers had not. In an attempt to debunk Mischel’s study, a group of psychological researchers redid the experiment, publishing the results in 2018, with a larger sample and a thorough study of the home environments of the subjects. Instead discrediting Mischel, the second study upheld the macro principles of his work; those who did best on the “new and improved” version were children who came from homes with large numbers of books and had very attentive, responsive parents. In other words, two-marshmallow children came from a different type of family than was, or is, standard. Crucially, the study found that the culturally impoverished, those with money and possibly advanced degrees but no books, did not do significantly better than those from financial poverty, with both groups producing marshmallow snatchers. On an interesting side note on the book divide, parental attention did not seem to make much of a difference, though it is possible that this is because the book-readers were also the better parents – the language is a little ambiguous on this point. 

The Atlantic, for example, more or less gloated that Mischel and co.’s unconscious snobbishness had finally been unmasked to the world:

There’s plenty of other research that sheds further light on the class dimension of the marshmallow test. The Harvard economist Sendhil Mullainathan and the Princeton behavioral scientist Eldar Shafir wrote a book in 2013, Scarcity: Why Having Too Little Means So Much, that detailed how poverty can lead people to opt for short-term rather than long-term rewards; the state of not having enough can change the way people think about what’s available now. In other words, a second marshmallow seems irrelevant when a child has reason to believe that the first one might vanish. [….]

These findings point to the idea that poorer parents try to indulge their kids when they can, while more-affluent parents tend to make their kids wait for bigger rewards. Hair dye and sweet treats might seem frivolous, but purchases like these are often the only indulgences poor families can afford. And for poor children, indulging in a small bit of joy today can make life feel more bearable, especially when there’s no guarantee of more joy tomorrow.

It is important to note that Mischel’s critics completely distorted his findings. At no point did he claim one group was superior to the other in any sense. Nor, did he claim, as is often misrepresented, that “character was everything.” These were all things impugned to him by opponents. All he did was prove that patience and self-restraint at age five (the approximate age of his subjects) tended to translate into disciplined, high-achieving high school students.[1]

The real rub of the marshmallow test is that it forced recognition of the fact that different child-rearing methods convey value sets, and that these values can be a determining factor in success or failure. They have the potential to translate into material, cultural, and social capital, or to reveal the lack of these things to the world. To make things worse, from a social justice standpoint, the experiments appear to demonstrate that values of the upper echelons are better because they have consistently produced the same results. 

The excuse-seeking used by The Atlantic author, such as hair dye and sweets, is recognizable to anyone who has read George Orwell’s The Road to Wigan Pier because the logic’s template is his chapter on the dietary habits of the northern English working-class in the 1930s. What isn’t shown is Orwell’s own honesty. While he gave his subjects a pass on spending eight pounds[2] on sugar, as the only affordable indulgence, he excoriated them for spending on tinned corn beef and dried milk when fresh meat and dairy was both readily available and were much, much cheaper. For him, it was one of the little ironies in the social fabric that the middle-class, who preferred fresh products, lived cheaper and better than the working-class, whom he suspected bought canned meat and desiccated milk out of some misplaced notion that this was what the middle-class ate exactly because cans and boxes were more expensive.     

In his book The Wealth of Humans: Work and Its Absence in the Twenty-First Century, journalist-economist Ryan Avent wrote on the subject of social capital:

Wealth has always been sociable. The long process of cultural development that eventually yielded the industrial revolution was in many ways the process by which humanity learned ever better ways of structuring society in order to foster the emergence of complex economic activity. Wealth creation in rich economies is nurtured by a complex system of legal institutions (such as property rights and the courts that uphold them), economic networks (such as fast and efficient transportation and access to scientific communities and capital markets) and culture (such as conceptions of the ‘good life’, respect for the law, and the status accorded to those who work hard and become rich). No individual can take credit for this system; it was built and is maintained by society.

Avent is absolutely correct, especially in terms of this as the essence of a capitalist society. To return to the marshmallow test and its subjects, if one divides society into snatchers and waiters and then looks at Avent’s behavioral traits, such as “respect for the law,” or values – “property rights” – one immediately sees that one of the two groups is going to fare much better than the other. This is not because one group is inherently superior to the other; no, the difference is that one group received the value system, and therefore social capital, necessary to function acceptably in a capitalist system. The other did not. 

Training the values to be functional in a capitalist system has nothing to do with society at large, and everything to do with the family. That said, society does play a role in terms of upholding bourgeois values, but modern American society has, as previously indicated, not only disincentivized such values but has come to stigmatize them as unacceptable. Up next: examples of the bourgeois family!  

[1]Officially, he has not directly published the results of his check up with the available subjects at age 49; however, the APA report, hyperlinked above, indicates that the two-marshmallow children honored their potential and became successful, fulfilled adults. 

[2]He either observed that they spent eight pounds money, or that they bought eight pounds in weight; he was not clear in his wording.

Ok, Americans – here is your Eurovision Guide

“Euro-what?” I hear you ask. Great! Set your coffee aside for a few minutes and indulge in a much-required and long-overdue cultural enlightenment.

Eurovision Mania is on, so you better get with it!

Eurovision Song Contest, or “Eurovision”, is an annual music competition that’s been running since 1956 and every year sees some 40 countries participating. And it’s massive. Every participating country selects an original song – usually through some kind of nationally televised show – with an associated live performance and all those entries get to perform in front of tens of thousands of ecstatic Eurovision fans from across the globe.

In short, it’s basically American’s Got Talent merged with The Voice – but structured a bit like Miss U.S.A – with tons more glitter, spex, showtime and glamour and with twice(!) the audience of SuperBowl. Beat that, ‘Murica.

Yes, that’s some 200 million people lining up their Saturday nights (and the preceeding Tuesday and Thursday too, for semi-finals) for this:

The winner is lavished in eternal fame and glory, and their country’s broadcasting company gets the honor of splashing out on next year’s event. As Israel’s Netta and her song ‘Toy’ won last year’s competition in Libson, Portugal, the 64th version of Eurovision is held in Tel Aviv, Israel, beginning today!

Is Israel European?

Perhaps not, but that’s never stopped Eurovision before. Actually, the event is organized by European Broadcasting Union (EBU), an alliance of public service media companies – and includes associate members such as Australian, Algerian, Jordanian and Lebanon organizations. Thus, the geographical boundaries for entries into Eurovision is somewhat flexible – which is why Australia has competed in the competition since 2015!

That’s also the reason Brexit won’t affect the UK’s participation in Eurovision, thank god!

So, what is this thing – and why have I never heard of it?

Depending on who you ask, Eurovision could be anything between a fabulous celebration of European unity through culture and music, or a dull, wasteful affair of pretty freaky performances. No doubt among the competition’s 1500 entries, it has seen its fair share of strange, quirky, silly and outrageous performances (just google some of them). But it also contains the fanciest, most extravagant dresses and costumes imaginable,  friendly rivalry, great music and an outburst of colors. Indeed, a bit like the SuperBowl, the half-time entertainment has been at least as interesting as most of the performances. This year it is even rumored that Madonna is making an appearance!

In other words, across the Atlantic, Eurovision mania has descended and will be this week’s Big Thing. Indeed, at 10 pm local time (3 p.m ET), the first semi-final begins, and the winner usually emerges after a rather complicated voting procedure sometime Saturday night (6 p.m ET).

As for American’s (un)surprising ignorance of the event, it’s even become somewhat of a Youtube phenomena of introducing this long-standing pan-European institution to shockingly unaware Americans and recording their reactions. Some of them are pretty spot-on (“this is the cheesiest of music shows!”). Without passing judgment on the worldy outlooks of Americans, y’all aren’t exactly – erm let’s say – well-versed in the going-ons of places beyond your coasts.

In the Eurovision case, not for lack of trying: in the last few years, Logo actually broadcasted the event, but couldn’t muster more than 50,000-75,000 viewers and so the greatest of European non-sports events won’t be on American TV this year. Hardcore fans (list of international broadcasters) are probably best served by a youtube live-stream.

Of course, the skimpy American coverage by outlets like the New York Times isn’t exactly helping either; their angle of the “Israel-Palestine dispute” compleeeeetely miss the point of Eurovision. The event’s apolitical nature is another thing that makes Eurovision so great: politics is strictly, explicitly, unavoidably relegated to the sidelines. As in political messages and even song lyrics with too definitive political flavors are censured or expelled. For instance, Iceland’s participants this year, the controversial band Hatari, is already challenging this sacred line of No Politics Beyond This Point by their frequent pro-Palestine stunts. Allegedly, they have already been issued a final warning by the organizers; one more political stunt and they’re disqualified.

In sum: Eurovision is the biggest, fanciest, most extravagant and entertaining music event you’ve never heard of. Get on the train. A great start is by watching the recap of this year’s 41 entries.

Epistemological anarchism to anarchism

I’ve been working on a paper — since I’ve long tabled the idea of a future in academia, or scholarship, I have only a few projects I want to get done in substitution — to expand the work of Paul Feyerabend into a political philosophy. Feyerabend’s primary discipline was the philosophy of science and epistemology, where he considered his central thesis to be “methodological” or “epistemological anarchism.”

His dialogues, essays, and lengthier expositions of (sometimes called) “epistemological Dadaism” can be roughly summed up as

For any scientific conclusion C, there is no one route from empirical premises P.

“Scientific” here being widely inclusive and contemporary with social standards, as a function of Feyerabend’s opposition to positivism. The hubbub of observation statements, empirical tests, auxiliary hypotheses, inferences, axioms, etc. that govern a research programme are only one possible set of multiple that have historically yielded similarly sanctified discoveries. For any B, there is no single route from A. Describing the scientific method as a route of Popperian falsification, for instance, cuts out Galileo, or cuts out Einstein, he would argue.

Feyerabend swore off the doctrine of political anarchism as a cruel system, although he was often inspired by revolutionary anarchists like Bakunin. Even still, his philosophy lends support for social power decentralization in general — even with sometimes grotesque deviations like his support for government suppression of academic inquiry.

I’ll be working on the paper on this, but in lieu of that, I think the primary connection between Feyerabend’s work on epistemology and a potential work in political science is the support of his epistemological thesis — for any scientific conclusion C, there is no one route from empirical premises P — for a broader methodological statement, namely, that for any outcome C, there is no one route from starting point A. For politics, this could mean:

For any social-organizational outcome O, there is no one route from given state of nature N.

Where “route” can clearly apply to ranges of government involvement, or zero government involvement. Feyerabend’s writings do not support this liberal of a reading in general, but in a constrained domain of social organization and especially knowledge-sharing (he was keen on dissolving hierarchies for their disruption of information), there might be a lot of connection to unearth.

This is, again, part of a larger project to bring Feyerabend more into the liberty spectrum — his writings are hosted on marxists.org, after all — or at least on the radar for inspiration. I’ll be posting more, and hopefully defending it, in the future.

Mr. Darcy’s Ten Thousand a Year

On popular demand, I’m reviving a reoccurring theme of mine: teaching economic history through the lens of popular culture. Today: bonds, yields and 18th century English financial planning.

In what is probably my favourite piece ever written, I tried to estimate exactly how rich Mr. Darcy was – Mr. Darcy, of course, of Jane Austen’s classic novel Pride & Prejudice. I showed that whatever method you use to translate incomes to the present, all characters in Austen’s captivating story are astonishingly rich. But, as we well know today, there are large differences even among the superrich; compare Bernie Sanders (small-time millionaire) with George Lucas and Steven Spielberg (single-digit billionaires) or Jeff Bezos (wealthiest man alive).

Using Pride & Prejudice to illustrate some economic point is hardly unconventional (Piketty did this in his Capital in the Twenty-First Century), so let me similarly discuss 18th and 19th century British financial markets using the characters in this well-known tale.

The starting point is the following musing, courtesy of former Oxford Economist Martin Slater’s (2018: 52) The National Debt; how come “female characters in nineteenth-century novels always seem to have a suspiciously exact income of ‘so many pounds per year'”? Where does this money come from? Why is it so exact? And what’s the reason Piketty uses this particular literary example to illustrate the permanence and steady stream of income that capital somehow just throws off?

Consols and Financial Markets

Financial markets are truly awesome – not just in their impressive scope or potential devastation, but in the many different needs they simultaneously fulfil for many different people. Slater ably guides us through the confusing mishmash that is the 17th and 18th century English public finance, but what emerges by 1757, after Henry Pelham’s consolidation of government debt, is two main – and for our purposes, equivalent – securities: the Consolidated 3% Annuities (and the ‘Reduced annuities’), affectionately named ‘Consols’. These were permanent government bonds with annual interest payments of 3%. This means that they had no maturity date, i.e. the holder of the security could expect the government to keep paying 3% of the face value for all future (a Churchill-issued subsequent Consol was actually repaid and retired just a few years ago, after almost a century in service).

Two cool things happen. First, the “initial value” – the face value – of debt running in perpetuity becomes almost irrelevant, since all that matters for the issuer is the ability to maintain interest rate payments; there is no presumption of future repayment. Second, creditors – that is, holders of the Consols who receive the regular interest payments – may trade that asset on financial markets. Since the plethora of different debt assets were now condensed into a single, credible, identical and easily-identified asset, the market for 3% Consols in London developed into a very large and liquid market. With such ease of access and predictable and stable payoffs, the Consols became the instrument of saving for well-off families in Austen’s time.

A note on yields

The Consols, essentially a piece of paper with a face value of £100, entitled the owner to a perpetual stream of payments by the government, in this case 3% – or £3. Now, the actual price at which this paper could be sold in London fluctuated extensively depending on the conditions of the financial market and, most prominently in Austen’s lifetime, the Napoleonic wars. As the £3 annual pay was serviced by the British government, and financial strain during the war increased the risk for defaults (through a foreign invasion or British government itself), the price of Consols was chiefly reflecting the military success.

When the market price of a debt falls below its face value, the effective interest rate (the “yield”) that a prospective investor receives increases; paying £50 for a Consol with face value of £100 and a £3 perpetual interest payment, effectively earns the investor 6% interest instead of 3% (3/50 = 0.06). Since the Consols were the most dominant asset on the largest financial market in the world, their price became “the single most important asset price in the world economy” as Klovland (1994: 165) called it. Here’s the yield on Consols during Austen’s life:

JA, yield on 3%

It reached a low of 3.11% in 1792 (almost at par), and a high of 6.22% in 1798 (below £50) after the suspension of the gold standard.

The Bennets and the fortunes of handsome young men

The families of Pride & Prejudice made good use of this thriving financial market – not specifically for trading but for financial planning (others, such as British economist David Ricardo, and the banking families of Rothschild and Barings, made some of their fortune trading Consols).

In the novel, Mr. Bennet – the protagonist Lizzy’s father – has an income of £2,000 a year (again, see my 2016 piece for three different attempts at “translating” these sums into today’s money). It is not clear what his income comes from, but it’s a fair guess that it stems, like many other landed gentry of the time, from renting out farm lands belonging to the family home Longbourne. In addition, we know that Mrs. Bennet’s portion to the family home is a £5,000 contribution which is the sole inheritance the (five) Bennet daughters are entitled to.

Now, the way well-off families like the Bennets would make use of Consols was to ensure that non-inheriting children had at least some source of income after the passing of their father. The underlying concern in Pride & Prejudice, causing Mrs. Bennet to worry so about fortunate marriages for her daughters, is that the Bennet estate is entailed away to Mr. Collins – and with it the presumed rental income of £2,000 a year. That would leave the girls homeless, reduced to living off Mrs. Bennet’s inheritance of £5,000.

Austen began writing First Impressions (the initial title for Pride & Prejudice) in October 1796. During the decade leading up to this, the yield on Consols had been firmly within the interval 3.5-4.5%, hovering around 4% for years. It should thus not surprise us that Mrs. Bennet’s fortune of £5,000 presumably consisting of Consols, would have been purchased at around £75, predictably yielding the family an annual return of 4%. Indeed, the characters of Pride & Prejudice seem to be squarely set on 4% being the general norm. For instance, in a desperate attempt to enhance his already-inane proposal to Lizzy, Mr. Collins explicitly says:

“To fortune I am perfectly indifferent, and shall make no demand of that nature on your father, since I am well aware that it could not be complied with; and that one thousand pounds in the 4 per cents, which will not be yours till after your mother’s decease, is all that you may ever be entitled to.”

(Chapter 19, p. 133 in the 2009 HarperCollins edition)

Here we see the great use that Consols offered families like the Bennets. Once the Bennet parents pass away, the £5,000 of Consols could be divided equally among her children; Lizzy’s share would be a thousand pounds, which earns her an annual 4% interest return, or £40 (although maybe several year’s earnings for a regular worker, this was a rather small sum for such rich families – in contemplating Lizzy’s sister Lydia’s imprudent marriage, we learn that Mr. Bennet spent almost £100/year on Lydia’s purchases and pocket money alone). Being liquid financial assets, dividing up the Consols among children was very easy, and their steady income stream ensured that they would have at least some income. Bar Napoleonic conquest, the interest payment on the Consols would reliably show up year after year.

As for the handsome young men, Mr. Bingley’s case is easier than Mr. Darcy’s. We know that Bingley’s income is not agricultural, but investments from a fortune of almost  £100,000 inherited from his father, who had not yet acquired an estate. The fortune was “acquired by trade”, where (being from the North) cotton or shipping are prime candidates, but the slave trade is also a possibility. We also know that the ambiguity of his annual income (£4,000 or £5,000) lies well within the return from a fortune of that size invested in Consols. Indeed, for Bingley to hold that kind of fortune, earn that income and still not have an estate of his own, suggests that his financial wealth consists predominantly of Consols – perhaps complemented with some other stock (Bank of England or East India Company stock are plausible candidates). Clearly, new money.

Mr. Darcy, on the other hand, is plainly old money. And a lot of it. There are subtle hints in the novel that Pemberley has been in the Darcy family for generations. What we don’t know is precisely how his £10,000 a year is earned. When visiting Pemberley in Derbyshire with her aunt and uncle, Lizzy is told by the housekeeper that Mr. Darcy is such a generous and fair man: “ask any of his tenants”, she says, which indicates that Mr. Darcy, has a fair number of them – as one would expect from a sizeable estate like Pemberley. Now, what we don’t know is if the entirety of his £10,000 a year is reaped from rental income; it could be that some of his income is financial – or that either his financial or rental income is excluded from this rumoured number. Beyond a mention of his sister, Georgiana’s, fortune of £30,000 – which for convenience would likely be held in Consols – we know very little about the personal finances of Mr. Darcy.

The use and abuse of Consols

The financial market for government debt in the late-18th and early 19th century was not created with financial planning in mind, but by incremental improvements to previous government funding problems. The outcome, however, was a striking success for Britain, whose thriving financial market in no small part accounted for Britannia’s Century until WWI.

Moreover, as contemporary economists from Ricardo and John Stuart Mill to Malthus and Lauderdale observed, the recurring interest payments, funded by taxes, may have had quite large macroeconomic consequences. Taxing ‘productive’ investments and trade in order to fund ‘unproductive’ holders of government debt was, it was argued, harmful to the country – and in a time where government expenditures largely consisted of the military and debt maintenance, the impacts of funding the debt was of prime political interest.

Piketty’s use of Austen’s England (and Balzac’s France) was used for precisely the same distinction. Wealth, in Piketty’s view, perpetuates itself, and effortlessly earns its return (never mind the work, risk and selection issues involved). By continually paying the interest on its debt, the governments of Austen’s Britain financed the leisurly lifestyles of the rich, just as the “natural” return of the modern-day rich contribute and maintain today’s inequality.

The Consol was a revolutionary invention, but it is possible that it was not part of Mr. Darcy’s Ten Thousand a Year.

Let’s Find Out – or: the Power of Reference

The core message of a number of books I’ve recently had the great pleasure to read has been fairly simple. Have a look. Check it out. Put your numbers in perspective. In a world awash with statistics and cognitive biases imploring us to cheer mindlessly for our own team, having the skill and wherewithal to step back and carefully ask: “can this really be so?” is golden.

One of recently passed celebrity professor and YouTube phenomenon Hans Rosling’s most profound advice for countering misinformation about the state of the world is precisely this: put all numbers in perspective. Never accept unaccompanied numbers – never believe the numerator without checking the denominator. What matters, as Bryan Caplan never ceases to emphasize as the GMU Economics creed, “are statistics, not emotions – and arguments, not stories.”

But, a statistic may never be left alone, Rosling maintains, but always compared to other relevant numbers. What share of its total category does this statistic represent? What was it last year, 5 or 10 or 20 years ago? Is there some self-evident change in associated behavior that is relevant or ought to explain it? A century ago street cars used to kill and injure hundreds of people every year, but since very few American cities make use of street cars today, the casualty is fortunately much lower. If we keep in mind that miles travelled by cars far outnumber miles travelled by street cars, reporting the number of street car deaths – while probably correct – entirely miss the point when discussing traffic safety. In How Not To Be Wrong, Mathematics professor Jordan Ellenberg quipped

Dividing one number by another is mere computation ; knowing what to divide by what is mathematics.

Here’s another example. If I told you about 23 000 individual deaths and spent a brief 10 second on each of them, going through the list would take me almost three days. On a personal level like that, 23 000 deaths is an absurd, insane, catastrophe-style event that few people are emotionally equipped to handle – essentially the size of my hometown, wiped out in a single year. If I told you those 23 000 deaths were due to antibiotic resistant diseases in the U.S. last year, the pandemic scenarios working through your mind quickly escalate. That many! Let’s find the nearest bunker!

If I then told you that cancer and heart diseases (each!) claim the lives of about 20x that, the fear of lethal apocalyptic germs consuming the world ought to quickly recede. Oh.

Here’s another example. It is entirely correct to point out that the number of people killed in worldwide airplane accidents in 2018 (556 people) was much higher than the year before (44 people) and the year before that (325 people). Would one be excused for believing that air travel is getting more risky and dangerous? Forbes, for instance, ran a roughly accurate story claiming that airline fatalities increased by 900%.

Not in the slightest. The number of fatalities from air travel has been falling for decades, all while the number of flights and miles travelled have increased exponentially, meaning that the per-flight, per-mile or per-passenger risk of death has kept dropping. Not to mention that alternative modes of travelling like driving is magnitudes more dangerous.

While Rosling teaches us to figure out what the base rate is, i.e. putting our statistic into appropriate perspective, one of Philip Tetlock’s tricks for becoming a ‘Superforecaster’ is to use Bayesian updating of one’s beliefs. This picks up precisely where Rosling’s idea left off. Once we know where to start, we have to amass more information, numbers and observations from other points of view – Bayesian updating is a popular method to incorporate and synthesize new information with the old.

In short “Calculation, like logic, is your friend” (Landsburg 2018: 44). Statistics matter and numbers can deceive. In order to better understand our realities and see through mistakes that others make – either intentionally to deceive or persuade, or unintentionally through ignorance – we must embrace the core message of people like Ellenberg, Tetlock, Duffy, Rosling or Pinker.

Always Be Comparing Thy Numbers. Never accept an unaccompanied statistic. Never trust numerators without denominators.