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Learning From Triple Shocks in 2020

I have been looking and thinking back of this turmoil year of 2020 lately. With today being the last day of 2020, it makes perfect sense to write this blog.

My Personal Achievements

On a personal level my biggest achievement this year is to survive the pandemic and stay healthy to celebrate Christmas (my favorite holiday for a non-Christian) and welcome the new year.

This has much to do with the fact that despite an expected death toll of 424,000 by January 23 according to CDC, Berkeley is a city with low caseload and thus presents low risk of getting infected. According to this excellent expert and fact based opinion piece, “when the coronavirus is more prevalent in an area, outcomes worsen.”

The same opinion piece also offers fatality figures that are good to know: “for people 60 years and older who were not living in jails or nursing homes, Covid-19 killed about one in 58 of those infected. For people between the ages of 40 and 59, it was about one in 833, and for people younger than 40 it was about one in 10,000. For those who were not white, the fatality rate was more than three times that for whites.” These numbers definitely put me in a higher risk category.

My second achievement is to finish an economics paper on backlash that I am very happy and satisfied. It presents a different perspective linking the trade models, labor economics and global economic divide, tradeoff of labor productive and allocative efficiencies in a new graphic model of PPF curves. Interestingly, the frame of thoughts was stabilized as early as in March, the rest of the time has been all about making the paper easy for everyone to understand.

Thirdly, I have benefitted from routine exercises, especially with the high intensity interval training (running uphill on the Dwight Way near my house) and now all my pants and belts are down from 36 to 32.

Fourthly, I have met and learned something from Berkeley freshmen living nearby, although slowly because I am a worrier (worrying about people not interested in talking to me or more accurately whether they are in the mood to chat; worrying about not able to recognize their faces and remember their names).

Finally, although I have not had even one penny of income from this February on (due to the inefficiency of government workers for distributing money to people), the “glass half-full” view is that I have enough savings to get me through another year in 2021 with little problem.

The Public Triple Shocks of 2020

On the public side, I believe we can learn from the following three shocks:

  • The Trump shock since he lost his election;
  • The George Floyd shock.

Learning From the Covid-19 Shock

The first lesson here is that humans tend to better respond to shocks caused by other humans than to pure natural shocks. More accurately, natural shocks can have a boosted human attention when they are combined with human shocks.

Here is a good example. According to the not the latest report from the Washington Post, one American has died in every 33 seconds due to COVID-19. While the dying person and the family must have been devastated, many others not having any symptoms may not even notice nor care about the death of others.

Deaths — even massive deaths — alone are not sufficient to alert all the humans, but deaths — even just a few — that are attributable to other humans (e.g., the “China virus”) will suddenly attract much attention. 

The other lesson is that we humans are still highly vulnerable to large scale natural shocks, as our capabilities and innovations are simply no match with the power of nature. This is not the time for complacency but rather for sober acknowledgment of our limits. Luckily, although this coronavirus is highly contagious, it is not too high in toxicity (in terms of fatality, see the piece cited above from today), otherwise the global death toll would be in tens of millions rather than 1.6 million as of the year end.

This means two things: One, it buys us some time to prepare for the next disaster or disasters and two we should gather all the resources we can have into a global coalition to move faster in research and innovations.

The Top Priority Question of Survival for the Human Species

The final lesson is to maintain human diversity so we humans collectively as a species can have a better survival opportunity when future disasters hit. This is one of the easiest things to do because diversity naturally exists among humans, all we need is not to kill or to reduce it. Unfortunately we do have a tendency to kill diversity, especially those behaviors not fitting our own preferences.

The other morning I was listening to Google News and one medical expert was talking about China holding the best chance to beat the spread of coronavirus and save lives. He has a good point. When it comes to pandemic the draconian measures implemented in China have proven their values. Yes, it is impossible to do the same in the US, but it is also unnecessary to over-criticize their way of doing things — as long as the Chinese people have no objection and as long as lives were saved.

In the end, we humans have a top priority not to repeat the same tragedy as dinosaurs and three quarters of plant and animal species that were wiped out from the face of the earth after the Cretaceous-Paleogene extinction even approximately 66 million years ago. Instead, we want to take advantage of our own diversity to help us survive as many natural shocks as possible.

Learning From the Trump Shock

The first thing we have learned from the Trump shock is that childhood matters and once you are settled with a certain personality or a predisposition through young ages, you barely change afterwards. Trump is a textbook example: At the age of 74 he still has been acting like a spoiled child.

Watching Populist Authoritarians Closely

The second lesson is that democracy in some ways is not that much different from non-democracy. Donald Trump has been serving as an excellent awakening call to anyone in doubt.

For one thing, democracy is not good at preventing dictators from taking powers. More accurately, a democracy is just as likely to produce what may be called “populist authoritarians” as a non-democracy does. For example, Xi, Jinping, Putin and Donald Trump are all populist authoritarians.

We are living in an era when pure “suppressive authoritarians” have a hard time to survive, while populist authoritarians are having their prime time of day.

Populist authoritarianism looks and feels like democracy, especially in countries that hold formal elections like Turkey and Russia. The key difference is in check and balance of power. Populist authoritarianism has its vested interests in an enhanced power of the executive branch of the government. Four years of Trump clearly have taught us that not all branches of government were born equal. The executive branch is the most active, fastest acting power to cover the broadest domains. The other branches act slowly and in an ex post facto manner.

The real danger of Trump as a populist authoritarian is not himself as an individual but his supporters who madly and wholeheartedly trust him. Every Democrat knows that, so is every member of the Republican establishment. The latter has not been speaking out against Trump, not for fear of Trump but rather of losing the voters who are only loyal to Trump.

In many ways, Trump is even more authoritarian than Xi and Putin are. For one thing, Trump is the only one openly admiring extreme authoritarians (e.g., Kim in North Korea) but showing little appreciation of the leaders in the allied countries. Trump is also very much an “imperial president” trying to grab more power than is allowed in the constitution. But most importantly, Trump has been the only populist authoritarian who has openly attacked or undermined the democratic institutions, which is expected to have lasting damages for years to come.

The Cost for Populist Authoritarians Is Higher in the US Than in China

Having said that, genuine democracy is still better at controlling or limiting damages of populist authoritarians. Trump knows that he can’t copy everything from his fellow authoritarians in other countries. This is because the cost for being a populist authoritarian in the US is higher than countries like China and perhaps also Russia (not knowing enough to be sure there). Trump’s lost bid for a second term proves that most clearly.

The higher cost comes from several sources. First of all, the US simply does not have the authoritarian tradition like China does. Many things that are taken for granted in China either do not even exist or exist in the opposite direction in the US.

Here is a shocking real life example. On December 8, 1994 in the city of Karamay, Xinjiang Uyghur Autonomous Region, the municipal government held a public performance event to celebrate the accomplishment of the the nine-year compulsory education in Karamay. There were 25 government officials in charge of public education, together with students and teachers from 7 local middle schools and 8 primary schools, for a total of 796 packed in a local theater. In the middle the performance however a fire started in the back stage by electric short circuit. Now, in the US one would expect the government officials and all the adults to help the children rush out of the building first. Instead, nobody acted heroically to save anyone else other than forcing his or her way out of the theater. The chaotic moments eventually claimed 325 lives, of whom 288 (more than 88%!) were the primary and middle schoolers. Miraculously, all 25 government officials survived without a scratch because some were shouting to “Let the leaders exit first!” ahead of everyone else. It’s not that they deserved the priority — none of them even tried to organize a more efficient and orderly exodus at the scene! They were left first only because their positions and titles.

My point here is that with such a tradition where citizens voluntarily give up their own rights and privilege to put government officials ahead and above themselves, everyone holding a governmental position or with an official title can act like an authoritarian, because they expect little objection or criticism from citizens. The only thing they have to worry about is making their superiors happy because in the end it is their votes that matter for who to get raised and who not.

Populist Authoritarians Are Manipulators

Now let’s think of other populist authoritarian countries with formal elections, where populist authoritarians have to maintain their popularity among a large group of people, just like in a democracy. How do they keep themselves in power for long?

It turns out that events of once in a long while (e.g., elections and campaigns) are easier to manipulate than we believe. For one thing, citizens can have a low involvement or engagement because each of them thinks his/her input counts little or nothing. Statistically speaking they are right: The marginal contribution of each individual vote is very small — unless in a tight competition like the one in Florida between Bush and Gore in 2000 and the coming Georgia runoff senate election.

One result is more likely when citizens are not taking active roles in the election: Whoever is already in power tends to stay there for the next term, because inactive citizens also dislike changes and uncertainties.

What separates genuine and authoritarian democracy is in the number of citizens taking elections seriously, either treating them like jury duties or a personal mission to exercise their right to monitor the government and to determine the country’s futures, with or without direct personal interests or stakes involved. Like I said elsewhere, such a duty- or mission-based attitude can be enhanced by strong personal preferences. The stronger the personal preferences, the more weight will be attached to each of the personal vote, like it is the last and only pivotal vote in the world.

The other difference between genuine and authoritarian democracy is the off-election periods. Genuine democracy is a continuous fights among citizens holding different preferences. It does not end with elections, the latter only makes a high tide but are impacted by continuous debates and fights off the high tide.

Finally, the existence of many social groups with diverse but equally strong preferences gives authoritarians a hard time to dominate for too long. No group is likely to win all the time, as other groups will make that less likely to happen.

I can add other factors for raising the cost of populist authoritarianism in the US, but the easiest way is to cite the five factors that helped protect democracy as listed in this report: 1. A decentralized voting system; 2. high turnout rate this time; 3. integrity and transparency; 4. the court and 5. the media. Behind these drivers there is just one that is supreme: The engaged diversity helps strengthen the US democracy and raise the cost of populist authoritarians.

Learning From the George Floyd Shock

This last shock is all about racial justice and BLM, an old problem with an old twist of police brutality. The damages are huge: According to this Wikipedia page, it has triggered BLM protests over 2,000 cities and towns in over 60 countries, with at least 26 million people participated in the United States alone, making the protests the largest in U.S. history. There were at least 19 deaths up till June 8, 2020, 14,000 arrests and $1-2 billion in uninsured damages in the States.

What can we learn from this by now old game?

The best way to put it: We need new strategies to achieve racial justice, as the current one does not work or it incurs too high a cost. If the goal is racial justice, then decades later we have only found ourselves losing the battle miserably, as we are more racially divided than ever before.

First of all, racial justice should be separated from criminal justice to the extent possible. For this reason, it is a bad idea to call for defund the police, because that would be the best way to lose the fights for racial justice as well as criminal justice.

Secondly, it is wrong to give all the attention to blacks only. Racial justice should cover all races, including the whites. All races should be treated equal, because doing anything otherwise only introduces troubles and imbalances in the future. In the long run, justice for all races is the only equilibrium, while “The crying baby gets milk” works only for short runs. If anything, it only makes the “crying baby” more disliked by others, although people may not reveal their feelings publicly given the strong power in self defense of the black community.

I have a terrible gut feeling: Had there been a civil war today, many blacks will be singled out, targeted and killed first and most. We can learn from the movie of American Murder: Family Next Door, in which the quiet husband had not revealed his anger and frustration for years, but suddenly killed the dominant wife and two daughters as a way of final revenge.

No racial justice is achievable without all racial groups trying to prove to each other that they have made creditable contributions to the society. While we can celebrate every governmental position taken by a minority as a sign of racial diversity, in the end every person must prove his/her worth to the society, regardless of which race she/he comes from.