Two pieces. First, Dani Rodrik:

And Willem Buiter:

The most influential New Classical and New Keynesian theorists all worked in what economists call a ‘complete markets paradigm’. In a world where there are markets for contingent claims trading that span all possible states of nature (all possible contingencies and outcomes), and in which intertemporal budget constraints are always satisfied by assumption, default, bankruptcy and insolvency are impossible. As a result, illiquidity – both funding illiquidity and market illiquidity – are also impossible, unless the guilt-ridden economic theorist imposes some unnatural (given the structure of the models he is working with), arbitrary friction(s), that made something called ‘money’ more liquid than everything else, but for no good reason. The irony of modelling liquidity by imposing money as a constraint on trade was lost on the profession.

Both the New Classical and New Keynesian complete markets macroeconomic theories not only did not allow questions about insolvency and illiquidity to be answered. They did not allow such questions to be asked.

[H/t: Mark Blyth]

#11, From Living in the Past
Philip Schultz

Everyone dickers with God. Everyone gets something:
Grandma gets one dead husband who does nothing
but read Torah and complain, the kitchen ceiling where
all her curses live rent-free, a lifetime of oy veis. … Uncle gets
his wieners, eight varieties of sauerkraut, five newspapers spread
over the kitchen table like a vast strategy, the Paramount screen
where he pulls curtains shut on Marlena D who shaves her legs
four times a day. Father gets free room and board, a coal-burner
to intimidate, all the blame. Mother gets the lower left half of
the icebox, where she hides bacon, popsicles, all her glee.
I get the best hiding places, Uncle's girlie books, the stained glass
attic window where the wind sings of inner and outer things,
as Martin Buber said, what are they but things—”O secrecy
without a secret! O accumulation of information!” I get faith
and intuition and 5763 years of longing and despair, a passion
for hearsay, boogieing, and epistemology …

From Cooper-Hewitt National Design Museum:

Internationally acclaimed artist Shahzia Sikander will serve as the ninth guest curator of the “Selects” exhibition series in the Nancy and Edwin Marks Gallery, devoted to showing the museum’s permanent collection. Sikander will mine and interpret the museum’s collection and produce an installation of selected work. This exhibition will include a new work created by Sikander, inspired by Cooper-Hewitt’s collection. Trained as a miniaturist at the National College of Arts in Lahore, Pakistan, Sikander merges the traditional South Asian art of miniature painting with contemporary forms and styles. Her work explores the relationship between the present and the past and the richness of multicultural identities.

More here.

From Harvard Magazine:

Bronson Alcott is known today—if he is known at all—as the father of Louisa May, the author of Little Women and more than a dozen other books written mainly for girls. But for a large part of the nineteenth century, he was the more famous of the pair. Born into a poor farming family in 1799, he rose to become a Transcendentalist philosopher, a groundbreaking educational theorist, and an influential friend of a number of eminent New Englanders, including Emerson, Thoreau, and Hawthorne. He was also a grandiose dreamer and schemer whose unbending pursuit of his (at times bizarre) ideals led him to squander his meager savings, refuse most work, and nearly abandon his long-suffering wife, Abba.

Fans of Little Women and its sequels will remember that the four spirited March sisters were romantically impoverished: Amy struggled to scrounge up the spare coins for a treat of pickled limes, and Meg and Jo had to make do with old dresses and lemonade-stained gloves when they attended balls in the fancier parts of Concord. The four Alcott girls were not so lucky. Their father was fired from a series of teaching jobs because of his rigid insistence that children should not learn by rote, and the Alcott family was often indigent, forced to rely on charity from Bronson’s famous friends to help them through.

More here.

Things can’t be that bad when you pull up to New York’s Armory Show – the granddaddy of six art fairs in the city this week – in a sparkling customised golf buggy, driven by a bloke wearing a spacesuit, while gorging on a free chocolate doughnut. This wacky races-style transportation service, laid on by veteran New York artist Kenny Scharf, gave a welcome touch of levity to the start of an art fair taking place in pretty dire circumstances: the DOW plunged below 7,000 points this week for the first time since 1997, New York galleries are downsizing or disappearing, major dealers Matthew Marks and Lehmann Maupin are among many skipping this year’s fair, and who knows how many New York-based collectors – the Armory Show’s lifeblood – got stung in Bernie Madoff’s pyramid scheme. Regardless, the Armory Show – now in its 11th year, and named after the 1913 art fair that brought Marcel Duchamp and modern art to New York – is actually expanding rather than contracting.

more from The Guardian here.

At the midpoint of the 1990s, the much-hyped Decade of the Brain, Peter Brook directed a stage version of Oliver Sacks’s book The Man Who Mistook His Wife for a Hat at the Cottesloe in London. At one point a patient was presented to a neurologist with a condition known as visual agnosia. The patient watched a screen on which a video of a seashore was depicted. He could describe moving white and blue lines and a strip of yellow: but he could not put it together to say what it was. At the end of the play, all the cast of patients and neurologists came on stage to watch another video: it depicted a PET scan showing the map of a brain gently pulsing in vivid colours. Brook meant his audience to grasp that brain imaging, as a way of understanding the mind, is as empty of meaning as impressions on a patient with visual agnosia. James Le Fanu, like Brook, and indeed Oliver Sacks, passionately believes that the human genome and contemporary neuroscience (the study of the brain and central nervous system) are ultimately futile as explanations of human nature. Le Fanu, a medical doctor by profession, is a very fine and thoughtful writer, a contributor on science and medicine to many periodicals, and author of the magisterial The Rise and Fall of Modern Medicine, arguably the best history of public medicine written to date. In this book, a strongly philosophical and historical critique of recent science, he stands out against the tide of effervescent scientific optimism that proclaims imminent explication of what it means to be human. It takes courage to resist that tide.

more from Literary Review here.

In the Believer:

THE BELIEVER: Your process is so different from that of most other directors: You ask actors to go with you on an intense journey in which they will spend months doing improvisations to develop their characters before anything gets set in stone. Because you only arrive at defining the characters and story line after months of workshops with the actors, you are unable to tell them much about the roles they’ll be playing at the start of the process. So how do your actors learn to trust you at the very start?

MIKE LEIGH: In the first place, I’m pretty thorough about whom I choose. I instinctively look for the kind of actor who is going to be trusting. There are all kinds of insecure people out there called actors. Some deeply untrusting actors—the kind that need to know exactly what’s what and are completely insecure—might be quite good within the parameters of a certain sort of acting. But I can’t work with these people. On the whole, I get people for whom not knowing what’s what isn’t a problem.

BLVR: How do you find out that this isn’t going to be a problem?

ML: It’s an instinctual thing. I have a feeling about an actor when I meet him or her for the first time during our initial interview.

BLVR: Is the interview the “twenty-minute get-to-know-you” chat I’ve read about in articles and books that describe your process?

ML: Yeah. We’re sitting in a room and there’s nobody else there but the actor and I. We talk about their life. Then if I feel the relationship’s going to move forward, I call them back in and we do some work for a while. It’s basically a process of getting a sense of people. The actors I collaborate with tend to be confident in the best sense of the word. They’re not overwhelmingly confident but relaxed, cool, together, focused, open, intelligent, and have a sense of humor.

Daniel Nichanian in openDemocracy:

Could a “French Obama” win a presidential election?

This is not just a rhetorical question; it has real significance in the French context. Obama's French enthusiasts inevitably distort his real profile and platform in their effort to frame his victory for their own purposes. The parts of Obama's story that his admirers invoke and the themes they emphasize provide a window into the glaring shortfalls of French society. Obama is a cipher for the Left's inability to sell its ideas; the rigid structure of political parties and stultifying hold of political elites; and the dreadful lack of minority figures in leadership positions.

One group of Obama admirers can be found in the Socialist Party (PS). The country's leading left-wing party has not won a presidential election since 1988 and a legislative election since 1997. Asphyxiated in recent years by the hyperactivity of right-wing President Nicolas Sarkozy and unable to counter the spread of conservative ideas, the PS has been in survival mode for much of the past decade.

Socialist leaders are now hoping to take advantage of Obama's victory to bolster their own cause and get back into France's political game. To regain power, the PS must learn how to make its platform look more appealing to lower and middle class voters. And what better way to do that than to insist the party's proposals are similar to those of the popular and emblematically progressive American president?

Marty Feldstein weighs in, in Project Syndicate:

The stimulus package would thus fill less than half of the hole in GDP caused by the decline in household wealth and housing construction, with the remaining demand shortfall of $450 billion in each of the next two years causing serious second-round effects. As demand falls, businesses will reduce production, leading to lower employment and incomes, which in turn will lead to further cuts in consumer spending.

To be sure, an improvement in the currently dysfunctional financial system will allow banks and other financial institutions to start lending to borrowers who want to spend but cannot get credit today. This will help, but it is unlikely to be enough to achieve positive GDP growth.

A second fiscal stimulus package is therefore likely. However, it will need to be much better targeted at increasing demand in order to avoid adding more to the national debt than the rise in domestic spending. Similarly, the tax changes in such a stimulus package should provide incentives to increase spending by households and businesses.

Although long-term government interest rates are now very low, they are beginning to rise in response to the outlook for a sharply rising national debt. The national debt held by US and foreign investors totaled about 40% of GDP at the end of 2008. It is likely to rise to more than 60% of GDP by the end of 2010, with the debt-to-GDP ratio continuing to increase. The resulting increase in real long-term interest rates will reduce all forms of interest-sensitive spending, adding further to the economy’s weakness.

So it is not clear what will occur to reverse the decline in GDP and end the economic downturn.

Our own Morgan Meis in The Smart Set:

There's a Donald Barthelme revival afoot. These things sometime happen to writers who have the temerity to die. Time moves on. Literary fashions wax and wane. Great writers are inexplicably forgotten. Forgotten writers are suddenly reborn in the literary imagination.

Such is the story with Barthelme. He was never exactly forgotten (he died in 1989), but his name hasn't been at the forefront of the collective literary mind since then. I suspect that the new biography by Tracy Daugherty, Hiding Man, signals a change in all that. There's also been a number of prominent “reconsiderations,” including a longish essay by Louis Menand in The New Yorker.

All of this was predicted by Thomas Pynchon, who wrote an introduction to a posthumous collection of Barthelme's “satires, parodies, fables, illustrated stories, and plays” called The Teachings of Don. B. Pynchon says that:

All things, in any event, will be set right when the biopic or Donald Barthelme Story is aired at last. … He will get the key to the city and a ride on a fire truck. Reviewers who trashed his work years ago will now fly into town, paying the full fare out of their own pockets, to apologize abjectly. All his books will show up again on the best-seller lists. Mike Ovitz of CAA will call from Hollywood with high-budget movie plans for some story the author has forgotten he wrote, and Barthelme will put him on hold while he goes to the fridge for another beer.

It's ironic that this comes from Pynchon, since it is people like Pynchon, DeLillo, and (more recently) David Foster Wallace who picked up where Barthelme left off and rendered him, at least temporarily, superfluous.

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Mary Beard on the familiar stand-bys of ancient humour and the schoolboy antics of murderous dictators.

From the Times Literary Supplement:

In the third century BC, when Roman ambassadors were negotiating with the Greek city of Tarentum, an ill-judged laugh put paid to any hope of peace. Ancient writers disagree about the exact cause of the mirth, but they agree that Greek laughter was the final straw in driving the Romans to war.

One account points the finger at the bad Greek of the leading Roman ambassador, Postumius. It was so ungrammatical and strangely accented that the Tarentines could not conceal their amusement. The historian Dio Cassius, by contrast, laid the blame on the Romans’ national dress. “So far from receiving them decently”, he wrote, “the Tarentines laughed at the Roman toga among other things. It was the city garb, which we use in the Forum. And the envoys had put this on, whether to make a suitably dignified impression or out of fear – thinking that it would make the Tarentines respect them. But in fact groups of revellers jeered at them.” One of these revellers, he goes on, even went so far as “to bend down and shit” all over the offending garment. If true, this may also have contributed to the Roman outrage. Yet it is the laughter that Postumius emphasized in his menacing, and prophetic, reply. “Laugh, laugh while you can. For you’ll be weeping a long time when you wash this garment clean with your blood.”

Despite the menace, this story has an immediate appeal. It offers a rare glimpse of how the pompous, toga-clad Romans could appear to their fellow inhabitants of the ancient Mediterranean; and a rare confirmation that the billowing, cumbersome wrap-around toga could look as comic to the Greeks of South Italy as it does to us. But at the same time the story combines some of the key ingredients of ancient laughter: power, ethnicity and the nagging sense that those who mocked their enemies would soon find themselves laughed at.

More here.

Joan Acocella in The New Yorker:

In the summer of 1816, Lord Byron, fleeing marital difficulties, was holed up in a villa on Lake Geneva. With him was his personal physician, John Polidori, and nearby, in another house, his friend Percy Bysshe Shelley; Shelley’s mistress, Mary Godwin; and Mary’s stepsister Claire Clairmont, who was angling for Byron’s attention (with reason: she was pregnant by him). The weather that summer was cold and rainy. The friends spent hours in Byron’s drawing room, talking. One night, they read one another ghost stories, which were very popular at the time, and Byron suggested that they all write ghost stories of their own. Shelley and Clairmont produced nothing. Byron began a story and then laid it aside. But the remaining members of the summer party went to their desks and created the two most enduring figures of the modern horror genre. Mary Godwin, eighteen years old, began her novel “Frankenstein” (1818), and John Polidori, apparently following a sketch that Byron had written for his abandoned story, wrote “The Vampyre: A Tale” (1819). In Polidori’s narrative, the undead villain is a proud, handsome aristocrat, fatal to women. (Some say that Polidori based the character on Byron.) He’s interested only in virgins; he sucks their necks; they die; he lives. The modern vampire was born.

More here.

Carl Zimmer in his excellent blog, The Loom:

Animals, as I explained in my recent column for Discover, take precautions not to get sick (including the famous anal cannon). We take precautions too–conscious ones, based on what we have learned about how diseases spread, and perhaps also unconscious ones that lower our risk of infection.

But if those precautions fail, we humans sometimes take medicines to kill off the pathogens making us sick. And there’s an intriguing body of evidence suggesting that animals take medicine too.

A lot of that evidence comes from studies on chimpanzees, our closest living relatives. When they get infected, they will sometimes devour leaves and other vegetation they otherwise never touch. In the case of one plant, the chimps have to first peel away an outer covering that is lethally toxic. They go to these lengths, it appears, because eating these plants can cure them of their ills. Some plants can flush parasites out of the gut and others actually fight the pathogens themselves. In fact, when researchers study the plants chimpanzees eat, they discover new compounds that kill bacteria and other pathogens. They look promising as medicines for people. (pdf).

Given the sophisticated minds of chimpanzees (they can, for example, plot rock-hurling attacks on zoo-goers), it’s possible that chimpanzees teach themselves which medicinal plants to take, and these medical traditions spread culturally. But other animals seem to eat peculiar things when they get sick, too. Even insects do. Obviously, no invertebrate has ever graduated from medical school. (Insert your doctor joke here.) So the question arises, are insects actually self-medicating, or are they getting so sick that their diet goes haywire?

More here.

Edited together from separate YouTube videos:

From The Guardian:

Salman Rushdie's novel The Enchantress of Florence has missed out on a major literary award yet again, after he was pipped to the post by Jhumpa Lahiri in the regional heats for the Commonwealth writers' prize. Lahiri's collection of short stories Unaccustomed Earth, which track from Seattle to Thailand to India as they explore family life and the immigrant experience, also beat Rushdie's fellow Booker contender Philip Hensher to win the Europe and South Asia regional heat. Chair of the judges, Professor Makarand Paranjape said the Bengali-American writer had faced “some very tough competition” from both Hensher's “magisterial survey of English suburbia”, and Rushdie's “fecund and fierce imagination”.

In the end, however, Lahiri's “lyrical, meticulously crafted prose, with the moving and memorable treatment of the diasporic experience coupled with her significant achievement in extending the form of the short story, won the day,” he said.

Mohammed Hanif was a much easier choice, the judges said, for the first book category. He emerged quickly as clear favourite for his novel A Case of Exploding Mangoes, a darkly comic tour de force which takes as its starting point the plane crash which killed Pakistan's military dictator General Zia ul Haq. Praised for its “amazingly detailed and plausible portrayal of historical events”, as well as its “great political insight and stylistic virtuosity”, the novel is the first Pakistani book to be a regional winner. Hanif said he was “especially pleased” to win the prize, particularly given the strength of his fellow nominees, who included Sulaiman Addonia for The Consequences of Love, and Joe Dunthorne for Submarine.

More here.

From Orion:

The green dumpster behind Red Lobster was nearly empty when I lifted the lid. Through the effluvium of yesterday’s supper, way down, sat a couple of pretty blue boxes. I hitched myself over the rim, leaned in, and took one.

I am not a regular dumpster diver. I was driven by a hunger for knowledge. Inside the restaurant, where the décor, ambience, soundtrack—all but the smell—reeked of the sea, I asked the server who laid before me the first plate of Red Lobster’s “endless shrimp” where they came from.

“Farms,” she said.

“Where are these farms?” I asked.

“Different places.” She gave a shrug. “Do you want another beer?”

I ate only eight grilled shrimp from Red Lobster’s “endless” supply. Something was stuck in my craw. An hour before, I had been in a community hall in Brownsville, Texas, with forty-three angry, tearful American shrimpers. In a country awash in shrimp, they were going bankrupt. They had gathered to hear more bad news: severe new rules limiting what they could catch.

“What about Red Lobster?” I asked the group.

“Red Lobster!” one man shouted. “They’re our enemy. They haven’t bought a shrimp since the 1980s.”

More here.

From Harper's:

This sentence caught my eye in yesterday’s International Herald Tribune:

Wells said that compared with the Cobbe portrait, the other representations now thought to be copies of it presented “an inanimate mask” of Shakespeare and that the discovery of the Cobbe painting would lead to a new generation of Shakespeare scholarship, driven by the realization that Shakespeare was more handsome, more fashionable, and more wealthy than previously believed.

The sentence appears in one version of Pulitzer Prize-winner John F. Burns’s reporting on the apparent (or possible, or contested) appearance of a “new” portrait of the Bard of Avon. If you haven’t seen the painting, it’s very lovely indeed, and surely does differ from the hydrocephalic fellow we’ve come to know and love. So said, the notion that a new generation of Shakespeare scholarship would be driven in a different direction by the “realization” that Shakespeare was “more handsome, more fashionable and more wealthy than previously believed” is drop-and-roll ridiculous. The number of idiotic assumptions that underlie such a statement (not Burns’s but, apparently, Wells’s) is hard to calculate, but their nature isn’t hard to characterize: we learn about art from artists (not from art).

More here.

A fog of know-nothing ideology, anti-intellectualism, cronyism, incompetence, and cynicism has, for eight years, enveloped the executive branch of the United States government. America’s role in the world and the policies that should shape and maintain it have been distorted by misguided decisions and by willful misinterpretations both of history and of current events. That fog is now being dispersed, and the vast intellectual and managerial resources of the United States are once again being mobilized. A blessing of this time of liberation and hope is that serious works of political analysis and philosophy may contribute to the new administration’s approach to its daunting agenda of global and national problems. That Barack Obama has made clear his admiration for one of the books under review—Reinhold Niebuhr’s The Irony of American History—is in itself reassuring.

more from the NYRB here.

One morning in late January, after a ride on the Paris métro to its terminus in the eastern suburb of Montreuil and a cold 10-minute walk through an industrial zone, I arrive at a nondescript, unheated warehouse. Inside, laid out on the floor of the large, open space, is a 33-meter-long white canvas, composed of 11 strips stapled together. The canvas is still mostly blank, with unfinished spheres in shades of blue, white, and yellow. Music plays softly in the background as three painters perform the immense task of painting what will portray a vast skyscape. These unromantic working-class environs are an unlikely place to find what might be one of the more romantic possibilities in art: a painting for the ceiling of the Louvre. As part of its mission to add contemporary artists’ work to its vast collection of paintings and crafts dating back to antiquity, the Louvre asked the American artist Cy Twombly to paint the ceiling of one of its galleries, the Salle des Bronzes. Twombly agreed, and for the first time since Georges Braque in 1953, a living artist’s work will adorn a ceiling of the iconic museum.

more from The American Scholar here.