The Vampire Louis

On October 4th, 1941, a pretty, little girl was born in New Orleans.  Her parents named her Howard Allen.  That’s right! Howard Allen, after her father, Howard O’Brien.  Howard Allen would go on to become the best selling author, Anne Rice.

After spending 38 years of her adult life as an atheist, Rice returned to her Roman Catholic faith.  As part of her conversion, the author of the Vampire Chronicles gave up writing about the darkness of vampires, and pledged to devote her literary skills to God.  After completing two books about the life of Jesus, Christ the Lord, Out of Egypt and Christ the Lord, The Road to Cana, Rice has written her memoir, Called Out of Darkness; A Spiritual Confession.

Rice describes turning away from the “glamor of evil”,  once again finding peace in the faith she abandoned as a young adult.  The glamor of evil is an interesting concept.  In every Roman Catholic baptism there is an exorcism, and the renouncing of the glamor of evil and Satan.  Evil often disguises itself in altruism or beauty, and many seemingly innocent actions are cloaked with evil.  In a chilling story from her childhood, Rice revealed that she pushed a small boy down a flight of stairs, just to see the look on his face.  The look the boy gave her, made her vow she would never repeat such an evil act.  But did her struggle with good and evil, continue not in her actions, but in the stories and characters of her writings?

The books Anne Rice wrote during her time as a devout atheist, center around the glamor of evil.  The vampires are beautiful, sensual beings, gifted with powers, but powerless to refuse their dark desires.  They are captivating, but captive.

Rice has left the world of darkness, but she may have one more vampire book in her.  More than a few of her characters await the redemption and salvation, she seems to have found.  Adam and Eve gave into temptation when they ate the fruit of the Tree of Knowledge of Good and Evil.  For Anne Rice, after 38 years of searching, she has left this knowledge where it belongs - with God.

Three Questions

It once occurred to a certain king, that if he always knew the right
time to begin everything; if he knew who were the right people to
listen to, and whom to avoid; and, above all, if he always knew what
was the most important thing to do, he would never fail in anything
he might undertake.

And this thought having occurred to him, he had it proclaimed
throughout his kingdom that he would give a great reward to any one
who would teach him what was the right time for every action, and
who were the most necessary people, and how he might know what was
the most important thing to do.

And learned men came to the King, but they all answered his
questions differently.

In reply to the first question, some said that to know the right
time for every action, one must draw up in advance, a table of days,
months and years, and must live strictly according to it. Only
thus, said they, could everything be done at its proper time.
Others declared that it was impossible to decide beforehand the
right time for every action; but that, not letting oneself be
absorbed in idle pastimes, one should always attend to all that was
going on, and then do what was most needful. Others, again, said
that however attentive the King might be to what was going on, it
was impossible for one man to decide correctly the right time for
every action, but that he should have a Council of wise men, who
would help him to fix the proper time for everything.

But then again others said there were some things which could not
wait to be laid before a Council, but about which one had at once to
decide whether to undertake them or not. But in order to decide
that, one must know beforehand what was going to happen. It is only
magicians who know that; and, therefore, in order to know the right
time for every action, one must consult magicians.

Equally various were the answers to the second question. Some said,
the people the King most needed were his councillors; others, the
priests; others, the doctors; while some said the warriors were the
most necessary.

To the third question, as to what was the most important occupation:
some replied that the most important thing in the world was science.
Others said it was skill in warfare; and others, again, that it was
religious worship.

All the answers being different, the King agreed with none of them,
and gave the reward to none. But still wishing to find the right
answers to his questions, he decided to consult a hermit, widely
renowned for his wisdom.

The hermit lived in a wood which he never quitted, and he received
none but common folk. So the King put on simple clothes, and before
reaching the hermit’s cell dismounted from his horse, and, leaving
his body-guard behind, went on alone.

When the King approached, the hermit was digging the ground in front
of his hut. Seeing the King, he greeted him and went on digging.
The hermit was frail and weak, and each time he stuck his spade into
the ground and turned a little earth, he breathed heavily.

The King went up to him and said: “I have come to you, wise hermit,
to ask you to answer three questions: How can I learn to do the
right thing at the right time? Who are the people I most need, and
to whom should I, therefore, pay more attention than to the rest?
And, what affairs are the most important, and need my first attention?”

The hermit listened to the King, but answered nothing. He just spat
on his hand and recommenced digging.

“You are tired,” said the King, “let me take the spade and work
awhile for you.”

“Thanks!” said the hermit, and, giving the spade to the King, he
sat down on the ground.

When he had dug two beds, the King stopped and repeated his
questions. The hermit again gave no answer, but rose, stretched out
his hand for the spade, and said:

“Now rest awhile-and let me work a bit.”

But the King did not give him the spade, and continued to dig. One
hour passed, and another. The sun began to sink behind the trees,
and the King at last stuck the spade into the ground, and said:

“I came to you, wise man, for an answer to my questions. If you can
give me none, tell me so, and I will return home.”

“Here comes some one running,” said the hermit, “let us see who it is.”

The King turned round, and saw a bearded man come running out of the
wood. The man held his hands pressed against his stomach, and blood
was flowing from under them. When he reached the King, he fell
fainting on the ground moaning feebly. The King and the hermit
unfastened the man’s clothing. There was a large wound in his
stomach. The King washed it as best he could, and bandaged it with
his handkerchief and with a towel the hermit had. But the blood
would not stop flowing, and the King again and again removed the
bandage soaked with warm blood, and washed and rebandaged the wound.
When at last the blood ceased flowing, the man revived and asked for
something to drink. The King brought fresh water and gave it to
him. Meanwhile the sun had set, and it had become cool. So the
King, with the hermit’s help, carried the wounded man into the hut
and laid him on the bed. Lying on the bed the man closed his eyes
and was quiet; but the King was so tired with his walk and with the
work he had done, that he crouched down on the threshold, and also
fell asleep–so soundly that he slept all through the short summer
night. When he awoke in the morning, it was long before he could
remember where he was, or who was the strange bearded man lying on
the bed and gazing intently at him with shining eyes.

“Forgive me!” said the bearded man in a weak voice, when he saw
that the King was awake and was looking at him.

“I do not know you, and have nothing to forgive you for,” said the King.

“You do not know me, but I know you. I am that enemy of yours who
swore to revenge himself on you, because you executed his brother
and seized his property. I knew you had gone alone to see the
hermit, and I resolved to kill you on your way back. But the day
passed and you did not return. So I came out from my ambush to find
you, and I came upon your bodyguard, and they recognized me, and
wounded me. I escaped from them, but should have bled to death had
you not dressed my wound. I wished to kill you, and you have saved
my life. Now, if I live, and if you wish it, I will serve you as your
most faithful slave, and will bid my sons do the same. Forgive me!”

The King was very glad to have made peace with his enemy so easily,
and to have gained him for a friend, and he not only forgave him,
but said he would send his servants and his own physician to attend
him, and promised to restore his property.

Having taken leave of the wounded man, the King went out into the
porch and looked around for the hermit. Before going away he wished
once more to beg an answer to the questions he had put. The hermit
was outside, on his knees, sowing seeds in the beds that had been
dug the day before.

The King approached him, and said:

“For the last time, I pray you to answer my questions, wise man.”

“You have already been answered!” said the hermit, still crouching
on his thin legs, and looking up at the King, who stood before him.

“How answered? What do you mean?” asked the King.

“Do you not see,” replied the hermit. “If you had not pitied my
weakness yesterday, and had not dug those beds for me, but had gone
your way, that man would have attacked you, and you would have
repented of not having stayed with me. So the most important time
was when you were digging the beds; and I was the most important
man; and to do me good was your most important business. Afterwards
when that man ran to us, the most important time was when you were
attending to him, for if you had not bound up his wounds he would
have died without having made peace with you. So he was the most
important man, and what you did for him was your most important
business. Remember then: there is only one time that is important–
Now! It is the most important time because it is the only time when
we have any power. The most necessary man is he with whom you are,
for no man knows whether he will ever have dealings with any one
else: and the most important affair is, to do him good, because for
that purpose alone was man sent into this life!”

Socrates drinks his Hemlock

Philosophy can trip me up at the best of times, but the death of Socrates in 399 B.C. has really puzzled me.  How could Athens, the birthplace of democracy and free speech, condemn a feeble, 70 old man to death, simply for some disrespectful blabbing?

The charges against Socrates were dubious at best.  Corrupting the youth of Athens? Impiety towards its Gods?  Please!  Socrates had been teaching for decades, and playwrights of the day could openly question Athenian involvement in its wars or ridicule its gods.  So why did the government come after Socrates near the end of his life?  And what lessons can we learn from this dark chapter of Western civilization?

Socrates’ students, Plato and Xenophon, gifted history with two decidedly biased cases for the defense, but absent from the record is a fair portrayal of the prosecution’s case.  For that we can turn to the little known father of blogging - I.F. Stone.

I.F. Stone

I.F. Stone was a fascinating, independent journalist, who from 1953 to 1971, self-published I.F. Stone’s Weekly.  At its peak in the 60’s, the four page political publication had a circulation of over 70,000.  Stone dared to go where the main stream media of his day wouldn’t.

I am a wholly independent newspaperman, standing alone, without organizational or party backing, beholden to no one but my good readers. I am even one up on Benjamin Franklin-I do not accept advertising.

Stone sought justice and truth and his exposés were backed up by meticulous research.  He fought against the Vietnam War, government lies, McCarthyism, and racial discrimination.  It is likely that his standing in journalism’s history would be much greater, except for the fact that he leaned a little too far to the left.  Kind of like a Noam Chomsky - if Chomsky was a newspaperman instead of a linguistics professor.  For the blogger, Stone should be an inspiration.  His stories were unique, informative, and groundbreaking. But he didn’t rely on special contacts, access, or insider information.  Instead, Stone delved deep into the public record.  He did his homework better than most of the affiliated journalists - poring over documents, Congressional records and hearings, connecting dots that others couldn’t see, and providing his readers with factual stories that couldn’t be found in any other publication.  Stone succeeded in giving the radical viewpoint.  In 2008, the Nieman Foundation for Journalism at Harvard, initiated the I.F. Stone Medal for journalistic independence.  The first award went to John Walcott, Washington bureau chief for McClatchy Newspapers.

In the early 70’s, after Stone’s health deteriorated, he gave up his weekly, learned Greek, and focused his boundless energy on studying the classics.  His book, The Trial of Socrates, gives a new perspective on the prosecution’s case against Socrates.  While Plato portrayed the 510 male jurors that condemned Socrates to death as a mobocracy, Stone gives evidence that Socrates was not just a harmless gadfly.  Socrates did not believe in egalitarianism or democracy and his teachings emboldened would-be tyrants.  After bloody, but short-lived,  tyrannical revolutions in 411 and 404 B.C., the citizens of Athens were fed-up with letting Socrates continue his anti-democratic rants.  The reign of the Thirty Tyrants resulting from the 404 B.C. revolution was particularly damaging to Socrates’ position in society.  A former student of Socrates, Critia, was one of the most vicious tyrants, and he led the violence against the democrats.  In less than a year, 1400 Athenians were killed and 5000 or 1/10th  of the city’s population were banished.  Socrates, however, was just fine.  He freely walked the streets, safe from persecution and fully complaisant to the dictatorial forces that rounded up, assaulted, killed, or exiled those around him.  Socrates spoke of virtue, but his actions were less than virtuous.

Imagine the fallout from a similar situation today.  Suppose a university professor set up a camp for radicals in some Washington D.C. neighborhood. Teaching students to loathe the elected government of the day, the teacher preached the virtues of a divine monarchy and inspiring one of his more ambitious students to actually attempt a violent coup d’ état.  After successfully killing off the freely-elected president in the White House, this new dictator then sets about killing off his opposition, and living large, until his tyrannical regime is defeated by democratic forces.  Luckily for the professor, a general amnesty is issued to quickly restore order in the society, so he is saved from prosecution. However, rather than sheepishly withdrawing from public, and counting his lucky stars he wasn’t a target of retribution, the professor proceeded to go right back to riling up a new set of potential revolutionaries.  Is it any wonder that a jury of Athenians would make a political decision to convict Socrates, and possibly spare themselves from a another Socrates-inspired tyrant?

The jury’s decision to convict Socrates was a political one, calculated to protect their democracy from a return of a violent and unfair dictatorship.  The death sentence for Socrates, however, was a reaction against Socrates’ intransigence.  Socrates wanted to turn the tables on his jurors, put Athenian democracy on trial, and prove to history the shortcomings inherent in a democracy.  Socrates goaded the jury into issuing their harsh sentence.  He could have paid a fine or accepted an exile, but he wanted to go out with a bang.

Lesson #1:  A single act of indifference can destroy your future.  At his trial, Socrates, defended himself as a man of virtue,  telling his jurors that he refused an unjust order by the Thirty Tyrants to arrest a wealthy land owner, so that the tyrants could seize his property.  However, Socrates did nothing to warn or help this innocent victim.  This glaring, act of indifference, tainted Socrates in the eyes of his jurors.

Lesson #2:  Get the facts before making a judgment. Plato’s Apology (defense of Socrates) is a beautiful example of how the masterful use of words can obscure the reality of a situation.

Lesson #3:  Be careful who you piss off.

Lesson #4:  Actions speak louder than words. Socrates spoke of virtue, but when it came time to “walk the walk”, he could only “talk the talk”.

Lesson #5:  Be careful what you unleash. It is unlikely that the unjust, tyrannical regime of those that included Critias, was in any way the type of preferred government that Socrates envisioned when he railed against democracy.  However,  he contributed to its possibility.

Lesson #5:  You’re never too old to make a contribution: In the eyes of many, I.F. Stone’s career ended in 1971 when his I.F. Stone Weekly stopped publication, and he retired from political journalism.  However, Stone carried on.  His book, The Trial of Socrates, is an exciting read that stands in sharp contrast to most of the staid, scholarly writings of Socrates’ demise.

Confusion is a word we have invented for an order which is not yet understood.

Henry Miller (1891 - 1980)

What to do with China?

Let’s face it, the financial crisis is nothing but confusing.  But if you want to see complete and utter confusion, take a look at how the Obama administration is dealing with China.  On January 23, Obama’s soon to be Treasury Secretary, Timothy Geithner, accused the Chinese of “manipulating their currency”.  Basically Geithner scolded the Chinese for keeping its currency artificially low, spurring domestic employment and exports, and then increasing their foreign exchange reserves by buying U.S. treasury securities with the proceeds.

However one month later, Obama’s Secretary of State, Hillary Clinton, traveled to Beijing and all but begged the Chinese government not to sell their U.S. Treasury securities and to please, please, continue to buy them in the future.

China has become the world’s largest foreign holder of U.S. treasury securities, with $780 billion of the $3.1 trillion in U.S. treasury securities held by foreign interests.  The U.S. needs China to finance their stimulus packages but China themselves are going to have to finance their own stimulus package.  China, however, is sitting on the world’s largest stash of cash, with $2 trillion in foreign exchange reserves.

Some think the financial crisis is signaling the end of the American Empire, and with it the end of the U.S. dollar’s reign as the world’s reserve currency.  The fact is, however,  that while the credibility of the U.S. dollar is at risk, conditions are not yet right for a run on the dollar.  The mere prospect of an Obama administration implementing better foreign and domestic policies is enough to postpone a massive liquidation of U.S. dollars by foreign investors.  I believe the seemingly contradictory policy statements of Clinton and Geithner, are in fact a reflection of a coordinated Obama strategy.  The dollar lost 15% to the yen and 40% to the euro over the 8 years that Bush pretended to be following a strong dollar policy.  Obama comes from the Paul Volker school of, “a country is stronger with a strong currency, not weaker”, and so he is just more believable than Bush when promoting a strong dollar.  There is a lot of deflationary pressure with the unwinding of leverage around the world, but I suspect Obama would support a Federal Reserve decision to start raising interest rates if inflation was on the horizon.  While Obama’s policies and stimulus will cost plenty, his withdrawal from Iraq will save the U.S. Treasury plenty.  The Nobel-prize winning economist, Joseph Stiglitz, has estimated that the Iraq war will have cost U.S. taxpayers $3 trillion dollars.  At the very least, Obama is moving America in a new direction.

The dollar is in jeopardy, not because the Federal Reserve is keeping interest rates low in the face of inflation, but because of the “twin deficits” (current account and fiscal), that the U.S. has allowed to balloon.  In this era of globalization, a country’s current account is a vital barometer of its economy.  When a country spends and invests more than its domestic income and savings, it has to fund the deficit with large inflows of foreign capital.  The U.S. consumer has been the driving force of much of the world’s economy, but this consumption has occurred on borrowed money.  The International Monetary Fund (IMF) expects the U.S. to have a current account deficit of $615 billion in 2008, while China will have a current account surplus of $386 billion.  Could the renminbi be the world’s reserve currency of the future?

The other crucial deficit affecting the dollar is the U.S. fiscal deficit.  This deficit is likely to reach $2 trillion in 2009, before dropping to $1.5 trillion in 2010.  Again, this deficit has to be financed mostly by non-residents, and while the world community is likely to bet on Obama in the short term, a protracted failure of U.S. policies will result in a flight from the American currency.

The pressure on Obama is immense.  By the end of his first term we should know if the reign of the American Empire will continue or be replaced by regional financial powers (China, Russia, Brazil, South Africa, Iran), and a much diminished role for the American dollar.  If there is the perception that the U.S. is falling into the abyss, the first sign of the dollar’s collapse may come from discussions in the Gulf countries revolving around revaluing their crude oil sales based on a basket of currencies.  A lot of very smart people are betting against the dollar  (Nouriel Roubini, Jim Rogers, Nassim Taleb), but I believe the U.S. will have one more kick at the can.  This optimism can be explained in two words - Chu and Varmus.  Huh! That’s right Chu and Varmas.  When Obama named Steven Chu as his Energy Secretary and Harold Varmus as his co-chair of the Council of Advisors on Science and Technology, he signaled that the U.S. government was going to embrace science and technology to get us out of this mess.  The two Nobel prize laureates are a reflection of Obama’s intelligence.  Obama is smart enough to get technology leaders into policy making positions and to lead us in a new direction.  My belief is that he will do the same in finance and foreign policy.

Those that think we are in for a prolonged (some say 10 year) deep recession/depression, don’t understand the speed at which the global economy now works.  Policy decisions, good and bad, that played out over years during the depression of the 1930’s, now would play out in a matter of days.  Let’s hope this fact is good news for Barack Obama and the American dollar.