I’ve been following current affairs in Canada in recent months, and I am continually impressed at the civility of public discourse up there, and at the quality of the judgement of governing officials. Today Canadians are going to the polls to cast a their vote in their 40th federal election.

I think one important thing is that people do not vote directly for the prime minister, as we vote for our president in the usa. The party with the most members in parliament appoints the prime minister (invariably this will be the leader of that party). The problem is that at election time, federal issues are often an abstraction to people. It’s unusual for people to feel like they have “skin in the game” (This 2008 usa election between Obama and McCain is an exception to that). And when there’s an abstraction, there is room for a third party (the mass media) to come in and “spin” the issues; in other words, they can create a narrative about things… which plays on people’s passions and guides them in how to vote.

We had the same problem with all these investment banks in recent years - AIG, Lehmann Brothers, Bear Stearns, etcetera. The shareholders owned those companies and had ultimate control over their direction. However, all the dealings of those companies were made into abstractions - mathematicians were hired to draw up very complex schemes of risk management. And because of that lack of transparency, the shareholders were at the mercy of whoever wanted to create the narrative about the health of those companies. And the shareholders consequently lost their shirts when the companies went under.

In Canada, people only vote for their representative to the federal parliament. And there really isn’t a way for any local publication or television station to make the citizens of that community believe an absurd and offbase narrative about the events in that town or city or county. People are living there day to day, and sure they’re curious about the specifics of what’s going on, and about causes and effects which pertain to events and trends in their community. But you can’t snow them. They see the town in front of them daily, as they go about their lives.

It’s interesting that the residents of Washington DC are immune to the spin of the mass media in the usa. They always see things more clearly. Unfortunately, those folks don’t even get to appoint a voting member to congress.

I have had a penchant in recent months for studying Canada. I have lived in the usa my whole life, but I remember having a fascination for Canada in my youth, and I have recently discovered many good audio, visual, and textual internet resources for keeping up with current events up north. One thing that I’ve been very impressed with is how rational Canadians are. There are laws about public discourse which make it so that journalists have to portray events honestly, and they have to be aware of their effect on society.

This reminds me of the many stories passed about in our society about the head and the heart. The usa is more like the heart - people value being spontaneous, they act based on their feelings. Canada is more like the head - they think things through carefully.

One thing I’m seeing about the Canadians who I see on the television feeds I can pick up through the internet is that they often look very worried - their faces are contorted with consternation. I understand that an ethic of rationalism might put a person into the mindset where she or he feels that she has to reason every decision through in real time. And worry becomes a part of that person’s life, only because it seems rational to predict negative outcomes, and to think through all the possibilities.

I have had a habit of delving into much intense thought. But I also have learned to feel carefree about things.

So I have some advice ;-)

The best way I can explain this, is to ask you to look at the mind with me. People often wrap up all of the things one experiences and endeavors in the mind into overbroad vague words like “thinking” or “intelligence.” However, in order to truly understand our own minds we have to look more specifically at the various activities we do in them. Now, human beings fall into different personality types - and the optimal way a person uses her or his mind will be different, depending on her personality. One should look and study the people you admire most - how do they seem to be using their minds from moment to moment, in different situations, and at different stages of a conversation?

We can separate the task of reasoning out, and see that reason is a thing which anyone can do - no matter how confused they happen to be, or how slowly they seem to be thinking that day. Reason is a process of weighing ideas, of looking at cause and effect. It can happen over a brief time period, or an extended time period - it can happen all at once, or it can happen in different sessions.

Now, of course mental habits are more general, and not specific to any thought or feeling, or any one sort of idea. Mental habits are the structure which you have laid out in your mind for thinking about various things in various life-circumstances. One practices these things and hones them, and from then on they flow fairly easily and automatically. Smooth thought does not happen by virtue of an ethic of careful reasoning, but because of a person having developing good daily mental habits.

To go futher here, I would have to fork my little essay and deal specifically with my own ethics when it comes to mental habits - ethics which are shared by many people of a similar personality type. However, I’m not sure how constructive that is, however, because I would most certainly offend people who would esteem an entirely different flavor of mental technique.

So I think I’ll leave this blog entry in bite-size form. That’s probably wise, given my fondness for the kind of language I use when I write.

The synopsis of what I’m saying, to put it simply, is that mental discipline leads to a carefree attitude. Your mind is either your prison, or your playground. And one has to be deft with it, in order to be happy. And this deftness I’m talking about has nothing to do with the ability to reason, it has to do with the ability to think smoothly from moment to moment.

This problem with the mortgage markets has given me the opportunity to think about how all these things work. According to most sources, the danger facing the country is the lack of money for the commercial paper market - which is where small businesses offer to pay an increased some of money in a day or a week, in return for a smaller amount of money today. From what I have heard - money market funds are the primary source of these short term loans. With all the tumult of late here and there in various markets, one such money market fund “broke the buck” - that is to say that those with money in that fund were sent word that their funds had actually decreased, rather than increased, because of the choices which the fund managers had made. Apparently, this event made other money market fund managers more conservative, and this meant that the pool of money which businesses usually draw on for their daily expenses dried up. This is the thing which folks say could “kill the economy.”

But wait a minute here. There’s no reason that the commercial paper market couldn’t be insulated from the rest of the problems on wall street - for instance, those problems in the mortgage markets. Those businesses which are utilizing this money are happy to support that fund and it’s welfare with the usury which they pay. This part of the financial system is healthy, and should remain so.

The mortgage markets, on the other hand, always were an unethical place to invest one’s money. There was no transparency. No one who had bought the debt service from the debtors knew about those debtors’ situations, and whether the service burdened that person unduly. And predator lenders, in writing up contracts for adjustable rate mortgages, were simply trying to “squeeze blood out of a turnip.” Naturally, the home owners would not be able to perform their debt service under those terms… and so the big dreams about all the money that would come from those investments were misguided.

I believe that the solution for all the money investment markets is to create end-to-end transparency. Everyone who purchases the debt service from a debtor, should know enough about that debtor’s situation to see whether that person or company is unfairly burdened by her or his commitment, and to see whether the means and the will is there to fulfill the commitment of performing that debt service.

In the short term… I don’t see any sense in tossing $700 billion usd at the mortgage markets, if congress is concerned about the commercial paper market. The commercial paper market has the means with which to sustain itself, if those running it get their act together and set things up properly.

Imagine two friends. One is rich and one is poor. The rich person has enough money to build himself a home, and live a lavish life, but the poor person lives in a rustic shack on the edge of town. The rich person offers to help his poor friend to buy a home… but only on the condition that his poor aquaintance make him even richer than he was already. Does this sound fair?

Now as I begin this discussion, let me start by saying that one important idea of mine is that strictly speaking, money is not wealth. Goods and services are wealth. Money is only a way to obtain wealth. The social contract we all adhere to as a society is that people produce goods and services, and in return receive the medium of exchange - cash. The cash allows people to obtain wealth elsewhere. Ok, now that I have explained that idea… let’s go on.

We see that banks violate this code of ethics. They don’t produce any good or service which adds to the wealth of the community. The house which is there was either built recently, or it was built decades earlier. The consumer or a former consumer is paying or has paid off the construction costs. The banks do not do that. Imagine being a bank - and you have your institution in the middle of a small town with five thousand homes. Imagine having contracts with 700 home owners in that town. Basically that is a money vacuum. Every thirty years, your institution gets to siphon off the current market price of each of those homes. And most of those homes were built long ago, and the construction costs have already been paid off. You didn’t have to do anything - you only had to be independently wealthy to begin with. In other words, your economic status itself gives you an income.

Now, if we can agree that a money lending organization is not producing any tangible good or service - that the company is just able to opportunize, because of the lower economic standing of the borrower - then we can ask ourselves “is there anything to keep that money lender in check?” A person who owns a factory has to produce safe, desirable and useful products. If he is not conscientious, he will go out of business and have to sell his equipment. There is no such safeguard with financial institutions, now is there?

During certain times of history some nations created laws to prevent financial institutions from charging “interest” - or as it was called back then “usury.” It was considered unethical and unworkable from an economic standpoint to allow wealthy people to do this kind of thing with their money - loan it out, and collect interest on the debt. I think, that given the financial tumult of this moment of history, we ought to look back into those dusty pages of history, and learn why those civilizations chose to do that. I believe we would find a lot of really important economic principles which they understood back then, and it might do us well to recognize some of them still might be important to consider.

As a person who is accustomed to working minimum wage jobs, I have often thought of the home-owner loans system as something of a scam. A renter ends up giving away a high percentage of her or his income, just to pay off the landlord’s mortgage. It feels like indentured servitude. It’s a very similar system, when you compare it to the serfs who lived on the noble’s land, and had to tithe a portion of their crop in order to keep the right to live in their home.

Over these past few years I saw these subprime loans being handed out and I had mixed feelings about it. I knew it was a foolhardy practice. I thought it was great for people who were usually renters, to be able to pour equity into their own homes instead of giving their landlords equity in the house. Zero down loans, from a human perspective, seem to be ideal. Home ownership is really important for the quality of life in a neighborhood. Home owners care about the curb appeal of their house, where, on the other hand, renters have a vested interest in preventing the house from appreciating in value. I also saw though, that the foolish lending practices were going to get the banks into a bind. I chuckled at the poetic justice which would happen that day.

Now, it’s happening… hmmm.

Today, it was fascinating to watch Paulson and Bernanke discussing their own proposed solutions with senators on Cspan. I think it is quite ironic for them to be asking Paulson for his best judgement on what possible solutions would be to the current crisis. Paulson was the CEO of Goldman Sachs between 2001 and 2006. He is one of the rogues who has been driving the economy off the cliff. Certainly governing officials shouldn’t be asking his advice for how to piece things back together again. At the end of the meeting a very vociferous member of the public was heard to be yelling about the “fox guarding the henhouse” and “no more corporate welfare.” Oddly enough, the incongruity of having Paulson up there seems to be better understood by those involved in the rancorous public outcry about this bailout than by the governing officials themselves.

The one thing that really stood out for me during that panel discussion was the myopic view of the situation which Paulson and Bernanke seemed to have. They are nearsighted to the point that they can’t see beyond their own noses. The problem was that unscrupulous mortgage brokers were trying to scam home buyers… with small text in their contracts about the mortgage rate adjusting upward at a certain point. As one of the senators pointed out, the solution to the banks’ problems would be to refinance the homes, and provide terms of repayment which were within the means of the home buyers. But somehow Paulson and Bernanke don’t care about those who are losing their homes to foreclosures (I believe the statistic which came out in this hearing was 10,000 per day in the usa). Somehow Paulson cannot see that the health of the financial markets goes hand in hand with the financial health of those who are paying off the mortgages. How are they going to get their money back, if they don’t take care of those who are going to give it to them? This seems like simple logic, to me.

To me, it seems that Paulson’s main goal is to opportunize on this disaster and use it as an chance to consolidate more power in the hands of the executive branch of government. President Bush has famously said “I am the decider.” And his administration has quite often used disasters as an excuse to concentrate power in the government, and to move towards more authoritarian types of practices. I suppose one has to forgive Bush for this desire of his, since those in the administration have big heads, and believe that the government goverrns. In point of fact, a government is very peripheral to the events happening in any nation… and only steps in when there is a serious problem that the people want their help with. People are those who, with their actions and daily lives create their own communities.

Barack Obama, the current democratic candidate for president seems to understand better that people in the nation have to pull together to create constructive agendas. Those agendas, or as he said “that change” cannot come from the top down.

I realize that it is an unconventional idea that banks should not charge interest on home loans. But it’s not that I’m really suggesting it as a way forward; I’m just musing on other ways that we could do things as a society. Certainly a soviet style centralized government housing system was not a workable solution. But why shouldn’t used houses depreciate in value, rather than appreciate? Why should a used house cost as much as a new home? The expense of housing is quite a large one. Could people get together in a community and pool their own moneys and build their houses and community infrastructure in an unconventional way? I read a story awhile back about an Amish family’s home which was destroyed in a tornado at 3pm on Monday, and by 2 pm on Tuesday it had been rebuilt because over a hundred Amish people had converged to rebuild it. The only expense for that house was the materials. Imagine if you could own a house and pay off the materials cost in a couple of years, and then live without having to pay rent or a mortgage from then on. Wouldn’t that be great? I think most of us would choose that option if we had it, and if the home was in a desirable location.

One of the things which is going to happen here that I see on the horizon, is that as it becomes harder and harder for people to be able to borrow money and get a home… manufacturers will start finding ways to make houses a lot more cheaply. For instance, you might see a sudden interest in this technology which allows a house to be built from bottom to top by a computer.

Well, I wrote up a long ugly page-long essay today about my assessment of how we have come into this mess with the financial markets failing in this september of 2008. I narrated all the facts of the circumstances of the past decade. But history will give our children and our grandchildren plenty of that kind of hard-to-read text. I think I’d rather summarize my ideas in only a few words here on my blog:

How does a great depression happen? When bankers are fools. When politicians are fools, and when there is enough rancor directed at the politicians to distract them to the point that they don’t give an earnest ear to those who would advise them in the right course.

I imagine the same thing happened during the 1920s, in the usa.

What is the lesson for us? Choose politicians who have good judgement - who will meet the time of trial with wisdom and earnestness. It’s not enough for a politician to look pretty or handsome, or talk smoothly. That person’s judgement has to be sound.

Along a timeline this is what happened: the foolish people in the Bush administration failed a test of their judgement on september 11th, 2001. They started panicking and acting in an imprudent fashion… then there was public outcry. That public outcry was met with obstinance. That obstinance closed down the lines of communication into the halls of congress. And those who would advise congress about the dangers facing the financial markets were not listened to. And then the markets melt down.

I’ve been following the Canadian election process this autumn primarily by listening to CBC radio’s internet offerings. And there seems to be a big disconnect in how the coverage is being done. The news reporters seem to view the election as a sporting event, and not as a series of job interviews. The people are hiring those who will perform government services for them. Making the whole thing into a horse race is not constructive. The media should be asking probing questions - and seeking to ascertain the quality of each individual candidate’s judgement in regards to certain issues. When the candidates are interviewed they should be required to talk about not only the pros of what their proposed policies will do, but also the cons. If a candidate is trying to snow the voters with shallow promises and one sided rhetoric, rather than sober and thorough discussion, it does not speak well of her or his judgement in my opinion.

This is a reposted comment which I placed earlier today over here at the blog of a Canadian broadcasting corporation podcast called “Search Engine.” The radio host had asked for suggestions from his viewership before he went onto another CBC program and talked about how he wished that young people would be more active in being involved with politics in Canada. So I chimed in.

Congratulations on a new season for Search Engine.

You asked for suggestions about Canadian politics. Hmmm… the first thing I would suggest, is that you don’t copy what we have done, across the border in the usa. Looking at Canadian politics to me, is like stepping back in time to a gentler year in the usa. Because the usa has moved on to quite a different political atmosphere - with a lot of rancour - the could’ve would’ve and should’ve ideas start kicking in when I look at what’s happening up in Canada. I’m half tempted to move to Canada; here’s an opportunity for those who will work diligently to effectively start down a different road and achieve a very different result than the mess in which we have found ourselves, south of the border in the usa.

A lot of an election campaign is a battle of perception. How a political party and its adherents portray themselves really makes a difference in whether they get votes. It’s not necessarily true that the person with the best judgement will win, but it’s the person who is perceived to have the best judgement (or if the election is in the usa - it’s the person who has the most charisma).

What I see in Stephen Harper’s conservative party in Canada, is that it seems to be the party of big business. Big business has the resources and the interest in grooming candidates to go into office to serve its interests. Why does Stephen Harper talk about “the economy” and “jobs” and all these kinds of concepts? It’s because the conservative party is, to use a colloquial expression, “in bed” with big business. Now there are certainly benefits for a community if politicians cater to the needs of big business. The right kind of economic growth is great for a community. Cities should always be looking to encourage desirable kinds of companies to come and set up shop in their neighborhood. But, we in the usa have seen that the money and swag and opportunities which go to politicians from big business can eventually become a serious problem.

Now, the other thing that I see, is that conservatives have such an impressive and detailed set of models about how the economy works, that voters start to think that they are the party of logic and reason.

The left-leaning political parties in Canada also follow a pattern I remember well. They talk primarily about lofty ideals. They are very principled groups, and they want to specifically make Canada a better place for everybody. But they don’t seem to talk in a very logical or pragmatic way.

Years ago, there was a political party which formed for a brief time in the usa which brought up the idea of “natural law” (think the historic philosopher John Locke) - the idea that there are certain ways in which social patterns, and economic patterns, and other patterns in the world can be mapped out. These are “natural laws” which govern how these things happen. People who agree on cause and effect here, can then reason things out together, and have some basis for offering policy proposals, and for comparing notes. Too often, there’s no foundation when politicians toss ideas back and forth between eachother. Stephane Dion might say that the green shift will do x y and z… but then Stephen Harper will say it will produce a very different set of effects. If they cannot agree on a set of paradigms to use to weigh the known outcomes of such policy, that’s not good.

This notion of “natural law” is a really powerful one (although the party which grew up in the usa years ago was really not very wise, and actually got distracted with some other foolish ideas). My wistful hope is that there would be a political party which grows up in a sensible way around this idea. This kind of philosophical dialogue would impress voters, I think; it would also shine a harsh light on the conservatives’ models - and show them up as being pretty flimsy, and focused unfairly around the interests and needs of business owners, rather than on the broader good of the general public.

I’ve been educating myself about Canadian culture over the past several months… daily listening to the CBCs podcasts for instance. In this new election season, I’ve read a lot more about Stephen Harper’s views on his job, and on Canada and on it’s economy. His perspective is that “Canada’s economy is weak, because of liberal policies.” Well isn’t that interesting? He sounds very much like a usa republican of the 1970s or 1980s. He is definitely not a neo-conservative as some Canadian liberals would want to label him. He’s a good natured fellow, it seems… and there is a lot of truth in the need to understand and facilitate market forces. It is interesting to think that his party might be like the usa republicans of twenty years ago, though. We have had exceedingly mixed results down here in the usa with the republicans being in power on Capitol Hill for the twelve years between 1994 and 2006. It’s fascinating that those who called themselves “conservatives” spoke in terms of precise models of economic cause and effect, and yet adopted a laissez faire attitude towards regulation in general. The truth is that even as they spoke about economics, they were motivated largely by contributions and benefits provided by industry leaders. So, they oftentimes did what industry leaders wanted them to do, because they were getting kickbacks from those organizations, in the form of lobbyist donations, lobbyist swag, ultra high-paying positions on the board of directors of national corporations after they left office, and such things. Dick Cheney’s ties to Halliburton have become the stuff of legend, for example.

The republican laissez-faire policies in the usa have in many ways led to social entropy… which is ironic considering that the christian right down here was always so vigorously saying that it wanted to promote good moral values. The social entropy we see in the usa evolved in the pre-internet years… where we had a centralized media which was suddenly released from the requirements of the “Fairness Doctrine” This happened in the 1980s, which is, as I gather, was about the same time that the Canadian government passed this law, seeking to ensure honesty and transparency in the press. Now, we in the usa have “shock jocks” spewing their diatribes on hate radio, and we have cable news services that many people look up to and respect which are actually all a charade of propaganda (like Fox News). Is this good for the usa? Absolutely not… I was shocked that even progressive news outlets like NPR (our usa version of Canada’s CBC radio) fully bought into the narrative about the war on the middle east for many years. And they defended the government’s foolish reasoning with a very sycophantic manner of journalism. This is what happens when charlatans are given the reigns of the public consensus-leveraging process - the whole nation’s judgement becomes clouded.

However, in the process of public discourse disintegrating into exaggeration and emotional nonsense, something good happened to the usa. This is, that because necessity is the mother of invention, people in the usa have had to learn some measure of critical and independent thinking about things. Critical thinking is what has given the usa it’s innovative spirit, and it’s zestful approach to life. From what I gather about Canadians, on the other hand, they seem to shy away from deep thought about negative things.

Another interesting movement that started in the mid-1980s was a new folksy kind of psychology which touted the importance of “positive thinking” and “personal affirmations.” This has become quite an influential brand of pop-psychology in north america. There’s a very big error in judgement which “positive thinkers” make, however. Let me map this one out for you.

• Can we agree that all the things that happen in the world around us are somewhere on the gradient of positive to neutral to negative?

• Can we then agree that it would not be healthy to be emotionally happy as you think about a negative thing? (admittedly, if you are able to see beyond the exact event and see the larger context - there can be things one can learn - and there is reason for pleasure in that… but I’m talking about only looking at the negative occurrence by itself)

If we agree on both of these points above, then we would have to conclude that there are a whole range of human emotions which are meet for the circumstances of thinking about different types of events that occur in the world around us. This logically means that one has to embrace the indignance and alarm and even the anger that comes to mind, when thinking about negative things. A person who wants to shirk angry feelings, necessarily has to become very hasty in how he or she looks at negative topics… that person has no time for a deep and earnest analysis of the causes and effects which surround these negative things. But, then isn’t it true that understanding the causes and effects and ramifications of the negative things in the world around us is one of the most important meditations we all have to do, as responsible human beings living in a society together? I have observed that those who will not squarely look at negative things will become weak in their lives. They will become less adept at daily living. Why? Because their understanding of these negative things that occur in the world around them becomes anemic, so to speak. They only have a cursory understanding of these negative events; and therefore, as they look out at the world around them, and try to put together the puzzle of how things work, they are missing large sections of the picture.

Naturally, the moment one brings indignance out, and voices it to someone in your personal life - it transforms into something which is very unhealthy socially - rancor or complaint. Chronic complaint is entirely unacceptable in a family. Members of the family should not be allowed to be “Eeyores” to use the comparison to a character from AA Milne’s Winnie the Pooh books. But a personal and private emotion of indignance and alarm when thinking about negative things is something we must embrace, if we are to be earnest in looking around us and understanding our world.

So here, is the difference I see between the culture of folks in Canada and the culture of folks in the usa. We south of the border have experienced a lot of social degredation in our manner of public discourse. And that has led to foolishness, some misery, and some confusion. However, the necessity of embracing critical thought has given us an innovative spirit, and a zest for life.

And thus my suggestion to our northern neighbors is that if you want to capture some of the zest for life you see south of the border… I would hope you would consider debunking the pop-psychology known as “positive thinking” - and instead, encourage your friends and neighbors to have a zeal for critical thinking.

One thing I’ve noticed about people I meet on the internet is the sense of “team ideology.” People generally seem to have agendas they are working on projects together, and if a person comes in and questions that agenda or shines a different light on the subject, the people get angry and they are at best dismissive towards the person, and often downright antagonistic towards the person.

The funny thing is that thinker/writers who seek to encourage social trends in direction a b c or d… are by definition not team players. They are seeking to catalyze change, and seeking to show their society another way forward for itself. These people are independent thinkers. If a person is sitting behind the wheel of a car, when that car is going in the right direction, does it need to be steered? Of course not. The driver doesn’t have to do anything with the wheel on a straight highway, until she or he sees the she is drifting into the next lane over; then she needs to make a correction. The same thing is true with philosophical thinkers. If one these types of folks is listening to a discussion, chances are she or he will not pipe up, until she sees the consensus going in a direction which seems unwise to the deep thinker’s sensibilities. And in this way we find ourselves always as single people out there, opposing the wishes and agendas of different teams.

This way of interacting with people makes for a very bumpy life course.