Some Very Smart, Shrewd Geniuses Agree, Trump is "a very stable genius”

Donald Trump has never been accused of over-modesty. His recent Tweet that he’s a “very stable genius,” however, seems over-the-top — batshit crazy, even for him.

Strangely, and for once, he’s actually right. Some very smart, shrewd people — Nobel Prize-winners, certified geniuses — agree with him. Read on, and here’s why they may be right.

***

If the purpose behind Donald Trump is to destroy confidence in democratic government, Donald Trump may be the greatest genius ever to hold high elected office in America. That goes for majority of Washington politicians, in both parties, these days. And, that this has all come together at this very moment in history is not just an accident.

The Right learned a long time ago that there is a trick to effective rule by a tiny minority of wealthy people. Wealth accrues and the economy grows fastest when incomes are transferred upwards to the top. In a society that elects lawmakers this, of course, requires that the majority are persuaded to vote against their own economic interests and to defer government benefits.

The key to the “genius” and “stability” of American democracy, therefore, is deception of the majority. In the last decades, at least since the Reagan Administration and back to Nixon, that is the principal reason the relative wealth and power of the One Percent have grown.

Enormous amounts of money have been poured into the media, foundations, and endowed chairs as the favored means of public deception and confusion about complex issues. The science of deception is largely the product of the Chicago School of Economics that branched out into parallel schools of political theory, social science and even law.

The founding figure of the Chicago School is Frank L. Knight, who oversaw the doctoral training of three of the most influential conservative economists of the last four decades.

Frank L. Knight’s University of Chicago School of Economics taught a string of Nobel Prize winners, Milton Friedman, George Stigler and James M. Buchanan. The professional acclaim heaped on them helped to legitimize the doctrine that the majority must be deceived to abandon their economic self-interest, and turned that into prevailing political-economic doctrine of our time. To Knight, writing at the time of FDR’s New Deal and the buildup to World War Two, the political self-interest of the majority indeed seemed dangerous:

“‘Persuasion,’ in the distinctive and proper meaning of that term, the core of which is deception.” -Knight, “The Meaning of Democracy: Its Politico-economic Structure and Ideals” (1941), in idem, Freedom and Reform, 227.

Knight’s best known academic contribution is his idea that there are two types of uncertainty that affect economic choices. He separated knowable risks (that can be calculated) from unknowable uncertainty. The latter type has been termed “Knightian uncertainty,” the amount of uncertainty in choices separate from calculable risk. As we see clearly today, the degree of uncertainty in choices has simply outrun the ability of many voters to determine their own self-interest. This explains a great deal about American politics in the 21st Century.

National politics has increasingly become a circus of chaos and spectacular irrationality at a time that America’s position is rapidly declining and ownership of corporate assets is moving offshore. The craziness of Trump and contested elections with ambiguous outcomes helps to paralyze the electorate and mask growing public inequality, giving billionaires enough time to move their money abroad without panicking other investors and crashing the markets.

A lot of this purposeful madness, of course, goes back to previous Administrations. Donald Rumsfeld, served many roles to a string of Republican Presidents since he was appointed economic advisor to Richard Nixon. Later, Rumsfeld made unacknowledged homage to Knight and the Chicago School. As Bush’s Defense Secretary, he made a seemingly nonsensical remark at a news conference in response to a reporter’s question why WMD had not been found in Iraq in June 2002. He observed in a memorable phrase at that time about “Known knowns” versus “known unknowns”. His words were pure Knightian Uncertainty:

Reports that say that something hasn’t happened are always interesting to me, because as we know, there are known knowns; there are things we know we know. We also know there are known unknowns; that is to say we know there are some things we do not know. But there are also unknown unknowns – the ones we don’t know we don’t know. And if one looks throughout the history of our country and other free countries, it is the latter category that tend to be the difficult ones.

Among academic economists and in business, the Chicago School’s legacy is openly acknowledged and embraced. Politicians still shy away from an open embrace of Knight and his acolytes. Among Knight’s Nobel Prize winning doctoral students, Milton Freidman is best known. His views on Supply Side economics and authoritarian politics should require little introduction. Stigler and Buchanan may be less familiar.

George Stigler (Nobel Prize, Econ., ‘82) developed the theory of Regulatory Capture. That teaches how federal agencies are “captured” by the industries they are supposed to regulate. Key Members of Congress and Agency heads who actually write and administer federal rules are often drawn from the ranks of corporate executives and lawyers. That is also a familiar fact of life.

The least known of the three Laureate disciples of Knight and the Chicago School is perhaps the most interesting, and relevant here. James Buchanan, is the subject of a recent book, Democracy in Chains, by Nancy MacLean. MacLean’s Democracy in Chains identifies James Buchanan as an intellectual leading light of “The Deep History of the Radical Right’s Stealth Plan for America.” The New York Times review observed: https://www.nytimes.com/2017/08/15/books/review/democracy-in-chains-nanc...

Buchanan, however, also had what MacLean calls a “stealth” agenda. He knew that the majority would never agree to being constrained. He therefore helped lead a push to undermine their trust in public institutions. The idea was to get voters to direct their ire at these institutions and divert their attention away from increasing income and wealth inequality.

. . .

Without saying as much, that is where Donald Trump shows his real genius, and long-term usefulness to Oligarchs and the Right. The book review continues:

American democracy was unprepared to defend itself against the agenda of Buchanan and conservative benefactors. Buchanan may not have been the only actor in this movement, and the role of conservative donors and economists has been documented elsewhere, but we are now living in a world he helped shepherd into reality. Public choice economists argue that those with the most to lose from change will pay the most attention, which has certainly been the case with Charles and David Koch. They and their friends have invested enormous sums in organizations that have changed the national debate about the proper role of government in the economy. Our politically polarized and increasingly paralyzed government institutions are the result.

With this book MacLean joins a growing chorus of scholars and journalists documenting the systematic, organized effort to undermine democracy and change the rules. In “Dark Money,” Jane Mayer tells the tale of the Koch brothers. In “Invisible Hands: The Businessmen’s Crusade Against the New Deal,” the historian Kim Phillips-Fein shows how a small group of businessmen initiated a decades-long effort to build popular support for free market economics. The political scientist Steven M. Teles writes about the chemicals magnate John M. Olin in “The Rise of the Conservative Legal Movement.”

But, that really goes back to dawn of the idea of [a limited] Democracy, to the Platonic cave of shadows and illusion the modern-day spooks and dirty-tricksters have mastered and applied to actual rule by deception in our electronic media-poisoned society. Perhaps it’s also useful to remember the so-called Golden Age of Athens which produced geniuses such as Plato and his student, Aristotle, also lasted for less than a century.

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Comments

That has got to be the most bizarre statement I've ever heard a U.S. president ever say

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boriscleto's picture

@gjohnsit With "Well I'm not a crook".

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7 users have voted.

" In the beginning, the universe was created. This has made a lot of people very angry, and is generally considered to have been a bad move. -- Douglas Adams, The Hitch Hiker's Guide to the Galaxy "

https://youpic.com/photographer/boriscleto/

@boriscleto @boriscleto

If there's a competition happening for the most bizarre Presidential statements, don't foget this contender:

https://www.theguardian.com/world/interactive/2009/jan/09/bushism-random...

Bushisms: The random wisdom of a president
George Bush, the outgoing US president, was a man famed for his unusual way with words. So go ahead and misunderestimate him one last time with our Bushisms generator

Hours of fun! Some pearls of wizen seem to repeat more often than others, but that's no surprise to those who know their Bush! Just keep clicking on the 'misunderestimate me' button and like me, you may eventually find malapropisms and outright verbal Grand Mal seizures which you've never even heard before! Dunno if these new pen-holding idiots can really compete with the man who proudly congratulated America for its greatness because a single mother who met him said she had to work 3 jobs, presumably 'to put food on her family'....

Edit to add this one quote from the selection:

“You saw the president yesterday. I thought he was very forward-leaning, as they say in diplomatic nuanced circles”

On Russian president Vladimir Putin, Rome, 23 July 2001

And that's why the backward ones in US politics are so afraid Putin'll unbalance their slide into the Dark Ages they're dragging the world into... Bush was of their number, of course, but he never did get that Orwellian neo-whatever propaganda language shift thing down any better than he did English, so he teeter-tottered a lot...

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9 users have voted.

Psychopathy is not a political position, whether labeled 'conservatism', 'centrism' or 'left'.

A tin labeled 'coffee' may be a can of worms or pathology identified by a lack of empathy/willingness to harm others to achieve personal desires.

Alligator Ed's picture

@Ellen North

“You saw the president yesterday. I thought he was very forward-leaning, as they say in diplomatic nuanced circles”

On Russian president Vladimir Putin, Rome, 23 July 2001

which is diplomatic for "about to face plant"

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@Alligator Ed @Alligator Ed

ROFLMAO! Although less likely for Putin than Bush, I expect, as the former of these crony-capitalists at least isn't itching to nuke the world for fun, power and profit. Or if he is, I've not seen any evidence of it.

Edit for the simple but elegant letter-typo forming my trademark.

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0 users have voted.

Psychopathy is not a political position, whether labeled 'conservatism', 'centrism' or 'left'.

A tin labeled 'coffee' may be a can of worms or pathology identified by a lack of empathy/willingness to harm others to achieve personal desires.

Meteor Man's picture

The Coase-Sanders Institute of Law & Ecomics was "launched" in 2011:

https://www.law.uchicago.edu/news/university-chicago-law-school-launches...

The Coase Theorem link:

What is 'Coase Theorem '. Coase theorem is a legal and economic theory that affirms that where there are complete competitive markets with no transactions costs, an efficient set of inputs and outputs to and from production-optimal distribution are selected, regardless of how property rights are divided.

https://www.bing.com/search?q=coase+theorem&PC=U316&FORM=CHROMN

The Chicago School of Economics has a few detractors. Under "Criticism" at wiki:

Paul Douglas, economist and Democratic senator from Illinois for 18 years, was uncomfortable with the environment he found at the university. He stated that, "…I was disconcerted to find that the economic and political conservatives had acquired almost complete dominance over my department and taught that market decisions were always right and profit values the supreme ones… The opinions of my colleagues would have confined government to the eighteenth-century functions of justice, police, and arms, which I thought had been insufficient even for that time and were certainly so for ours. These men would neither use statistical data to develop economic theory nor accept critical analysis of the economic system… (Frank) Knight was now openly hostile, and his disciples seemed to be everywhere. If I stayed, it would be in an unfriendly environment."[23]

https://en.m.wikipedia.org/wiki/Chicago_school_of_economics

Excellent informative essay leveymg.

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"They'll say we're disturbing the peace, but there is no peace. What really bothers them is that we are disturbing the war." Howard Zinn

@Meteor Man
is a thought experiment. The true value of every transaction is apparent to everyone involved in the transaction. (Information on preferences is free and always accurate.) There are very interesting thought experiments you can conduct assuming a zero transactions cost universe.

The best analogy I heard compared a zero transactions cost universe in economics to a frictionless universe in physics. You might learn something thinking about them, but they aren't, and can never be, real.

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Alligator Ed's picture

@FuturePassed A Coase Economic System is not real and won't ever be because it leaves no room for graft.

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Arrow's picture

I had a run in with Milt on a conference call at the local library once.
I was reading a lot of URPE (Union for Radical Political Economics) back then. The URPE guys wrote an article stating that The Fed had lost control of the money supply though credit and financial engineering(this was the 70's and boy were they right). I asked at the time if debt obligations had supplanted the Fed's control mechanisms (discount window/printing money). He blew up at me and said "Money is Money!" and had no real argument.(You know...Chicago School Economics)

Just thought I'd stir that into the pot.

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9 users have voted.

I want a Pony!

@Arrow

Thanks, and I wish you had audio, better yet, video with his expression while on the phone in that call, to share.

I trust that's not stirred into the same sort of pot Friedman et al ought to be flushed down? Because I love imagining this scene too much to let it go for any reason.

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5 users have voted.

Psychopathy is not a political position, whether labeled 'conservatism', 'centrism' or 'left'.

A tin labeled 'coffee' may be a can of worms or pathology identified by a lack of empathy/willingness to harm others to achieve personal desires.

destroying the Central Intelligence Agency's hard work in Chile. Reduction of public spending and privatization (which effectively transferred public goods into the hands of the Army) failed so badly in Chile that by the mid-1980s GHW Bush had to cut most of the ties from Washington that sustained the Pinochet Junta. Of course, Pinochet lost his referendum and the center-right party was allowed back into office. Fiendman, in fact, didn't know what he was doing.

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@leveymg
Friedman's prescriptions in Israel with similar results.

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@leveymg
after the bank crises of 2007/2008.

This was only after had brutally damaged the economies and people of multiple nations.

Yet they continue the same strategies today in Greece, Portugal, etc et al.

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@gustogirl Yeah, ask most any economist then what it looked like for the economy and it would have been rainbows and ponies as far as the eye can see. Most of this "science" seems to be on the level of the financial version of promoting tobacco products.

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perfectly benign God is on your side in a war. There are likely to unintended consequences and costs to any action taken with such an assumption.

Adverse outcomes can come from imperfect information (asymmetries) as well as market inefficiencies and transaction costs. But that just shows my bias. For some reason a while back I wrote Joe Steiglitz about what he thought the consequences of intensive securitization on a global scale would be. It was a hot topic at the time, and I had just had a comment published in Foreign Policy magazine. He actually answered it with a two-page hand-written note! Taught me that not all Nobel Laureates in Economics are assholes.

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Meteor Man's picture

@leveymg @leveymg
Knows all, sees all. In the Holy Trinity of economics we have Supply, Demand and The Invisible Hand. The omniscient invisible hand is The Holy Ghost helper that makes sure the commands of Supply and Demand are fulfilled.

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7 users have voted.

"They'll say we're disturbing the peace, but there is no peace. What really bothers them is that we are disturbing the war." Howard Zinn

near ready to concede that Rump himself is the genius, but his handlers certainly are brilliant in their long term crusade to discredit government as a functioning institution.

I read somewhere that the now ordinary tactic of putting people who don't know shit about Cabinet positions was begun in earnest under St Ronnie the Dim, with the intent of putting Corporate stooges into regulatory positions of course, but also had the effect of making government simply incompetent. And across the decades they all do it now, both "sides" of our owning class, the gift that keeps on giving, although the Repukes do seem a bit more blatant with their particular version of stooge.

Trump may be just shrewd enough to see it, but he didn't invent it. And I also know you're not saying he did. He didn't invent the racism he used to get into office either, he played that fiddle very, very well that was almost tailor made for him.

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Bollox Ref's picture

with one quote being...

The minimum wage prevents many people get a job

Or perhaps English wasn't Milton's first language.

Paradise Lost indeed.

(Edited)

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7 users have voted.

Gëzuar!!
from a reasonably stable genius.

@Bollox Ref

Probably a 'that' missing from the quote, or at least that's what I thought reading it.

The minimum wage prevents (that) many people get a job

???

and I would think there'd be more to the sentence it came from... ???

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2 users have voted.

Psychopathy is not a political position, whether labeled 'conservatism', 'centrism' or 'left'.

A tin labeled 'coffee' may be a can of worms or pathology identified by a lack of empathy/willingness to harm others to achieve personal desires.

Alligator Ed's picture

@Ellen North @Ellen North

The minimum wage prevents (that) many people get a job

is of course (or of Coase) followed by the exculpatory assault on humanity as follows:

Instead of paying a person $7.75 per hour, we could hire 3 people and pay them $2.26 per hour--see! More jobs!

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@Alligator Ed

Damn, I was tired and somehow thinking in terms of the obvious fact that a too-low minimum wage kills off the economy, reducing jobs which then aren't there for people to have, and that a living wage would, of course, turn this around, not of that insane notion that having no protection of any minimum wage law would be good and allow more job openings on even lower wages than are already grossly inadequate.

Well, maybe,sorta, in that on which as-close-to-nothing-as-possible-wages as some of the shorter-sighted, greed-maddened TPTB evidently want, homeless workers would starve faster, therefore dying off and rapidly creating more job openings, when nobody can afford to buy the products they'd be too weak to make anyway. Perhaps that actually works out for the psychopaths, who apparently feel that they can afford such expensive entertainment as watching the rest of us miserably perish while being unable to purchase any of their products, but that involves that missing portion of their brains.

While anyone still has any remaining money, perhaps we should all just stop buying from criminal corporations now, and see what happens to their bottom lines, political influence and power?

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0 users have voted.

Psychopathy is not a political position, whether labeled 'conservatism', 'centrism' or 'left'.

A tin labeled 'coffee' may be a can of worms or pathology identified by a lack of empathy/willingness to harm others to achieve personal desires.

Former MIT trained computer scientist, now hedge fund multi-billionaire who is using database algorithms to get everybody fighting each other as a distraction from the thievery going on. Trump and Bannon work for Mercer.

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3 users have voted.

Beware the bullshit factories.

@Timmethy2.0

Yeah, he apparently doesn't like people, prefers computers and money. Shows, doesn't it?

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0 users have voted.

Psychopathy is not a political position, whether labeled 'conservatism', 'centrism' or 'left'.

A tin labeled 'coffee' may be a can of worms or pathology identified by a lack of empathy/willingness to harm others to achieve personal desires.

Complete with a high priesthood and a canon of minutiae written in an obscure language the non-ordained cannot understand but are obliged to confess they believe with all their hearts.

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@leveymg

Exactly! TPTB worship Mammon, while we are to worship Wall St.'s golden, steaming bull(-crap). (Sometimes it trickles down in a golden shower, sometimes with an even more pungent Splat!)

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0 users have voted.

Psychopathy is not a political position, whether labeled 'conservatism', 'centrism' or 'left'.

A tin labeled 'coffee' may be a can of worms or pathology identified by a lack of empathy/willingness to harm others to achieve personal desires.