There is an element of fiction in all successful politics, but these works show the deliriously entertaining distortions that result when fiction (or creative nonfiction) asserts its authority over the political realm. John Cowper Powys’s epic poses the following question: if getting caught with a dead girl or a live boy is political suicide, what does an affair with an endangered, aboriginal giantess portend for a prince about to ascend to the throne? How would Charles Kinbote’s claims about his native Zembla in Nabokov’sPale Fire hold up in the age of PolitiFact? Ben Marcus’s dystopian allegory-cum-bildungsroman-cum-anthropological study lets us ponder what debate format would best suit Jane Dark, the pantomiming leader of a political party called the Silentists. A Henry James’s story, “The Private Life” asks just what happens to a figure with a preternatural knack for finding a public when nobody is around. Finally, Gertrude Stein’s authorized autobiography of her lover and modernist Paris explores why the military should embrace the avant-garde or risk obsolescence. Each work puts forth a character who, however indelible, remains doggedly unelectable.
On a personal level, I am quite fond of Slavoj Žižek. Although I have never met him, the eminent Slovenian philosopher and pontificator on all things human and Hollywood has been on and off my radar screen for roughly the past six years. I remember reading his book Iraq: The Borrowed Kettle for a political philosophy class during the fall of my sophomore year, an effort during which I oscillated constantly between utter incomprehension at the printed words and then wide-eyed awe as the intellectual fog was periodically pierced through by a searing line of wisdom.
I still remember the night he spoke at my school that same semester: as he was being introduced to a packed auditorium, he fidgeted maniacally like some sort of homeless intellectual on cocaine. This peculiar practice continued throughout the duration of his speech, which was entitled, “Why Only an Atheist Can Believe: Politics between Fear and Trembling.” Like so much of his writing, even this headliner revealed Žižek’s endless fascination with logical inversion: one almost pictures him reading bedtime stories to children, explaining how in fact it is fires that are safe and fenced-in backyards that are dangerous, and so on. For Žižek, up is — almost by definition — down.
So when I read several weeks ago that he had written a book on the populist trajectory of events in 2011, I immediately pre-ordered it online, expecting to receive it on its release date of October 9th, 2012. For whatever reason, Amazon.com shipped it early, and I began reading it several days ago.
In The Year of Dreaming Dangerously, published by Verso Books, Slavoj Žižek scores a solid blow against the hysterical zeitgeist of the West post-9/11 (page 43):
A century ago G. K. Chesterton clearly described the fundamental deadlock of critics of religion: “Men who begin to fight the Church for the sake of freedom and humanity end by flinging away freedom and humanity if only they may fight the Church…The secularists have not wrecked divine things; but the secularists have wrecked secular things, if that is any comfort to them.” Does not the same hold for the advocates of religion themselves? How many fanatical defenders of religion started by ferociously attacking contemporary secular culture and ended up forsaking any meaningful religious experience? In a similar way, many liberal warriors are so eager to fight anti-democratic fundamentalism that they will end by flinging away freedom and democracy themselves so that they may fight terror. If the “terrorists” are ready to wreck this world for love of another, our defenders are ready to wreck their own democratic world out of hatred for the Muslim other. Some of them love human dignity so much that they are ready to legitimize torture — the ultimate degradation of that dignity.
This is a valid point. It’s the kind of point he makes so clearly and succinctly, the kind I first came to appreciate during my sophomore year in college.
It’s also a surprisingly familiar one. Eight years ago, Žižek penned some uncannily similar thoughts in his book Iraq: The Borrowed Kettle (p. 33-34):
Although the ongoing ‘war on terror’ presents itself as the defence of the democratic legacy, it courts the danger clearly perceived a century ago by G.K. Chesterton who, in Orthodoxy, laid bare the fundamental deadlock of the critics of religion:
Men who begin to fight the Church for the sake of freedom and humanity end by flinging away freedom and humanity if only they may fight the Church….The secularists have not wrecked divine things; but the secularists have wrecked secular things, if that is any comfort to them.
Does the same not hold today for advocates of religion themselves? How many fanatical defenders of religion started by ferociously attacking contemporary secular culture, and ended up forsaking any meaningful religious experience? In a similar way, many liberal warriors are so eager to fight anti-democratic fundamentalism that they will end up by flinging away freedom and democracy themselves. They have such a passion for proving that non-Christian fundamentalism is the main threat to freedom that they are ready to fall back on the position that we have to limit our own freedom here and now, in our allegedly Christian societies. If the ‘terrorists’ are ready to wreck this world for love of another world, our warriors on terror are ready to wreck their own democratic world out of hatred for the Muslim other. Some of them love human dignity so much that they are ready to legalize torture — the ultimate degradation of human dignity — to defend it….
A century ago, Gilbert Keith Chesterton clearly deployed the fundamental deadlock of the critics of religion:
“Men who begin to fight the church for the sake of freedom and humanity end by flinging away freedom and humanity if only they may fight the church … The secularists have not wrecked divine things; but the secularists have wrecked secular things, if that is any comfort to them.”
The same holds true for the advocates of religion themselves. How many fanatical defenders of religion started out attacking secular culture and ended up forsaking any meaningful religious experience?
In a similar way, many liberal warriors are so eager to fight anti-democratic fundamentalism that they end up flinging away freedom and democracy themselves. If the “terrorists” are ready to wreck this world for love of another world, our warriors on terror are ready to wreck their own democratic world out of hatred for the Muslim other. Some of them love human dignity so much that they are even ready to legalise torture – the ultimate degradation of human dignity – to defend it.
And here he is in June 2012, writing for the London Review of Books:
A hundred years ago, G.K. Chesterton articulated the deadlock in which critics of religion find themselves: ‘Men who begin to fight the Church for the sake of freedom and humanity end by flinging away freedom and humanity if only they may fight the Church … The secularists have not wrecked divine things; but the secularists have wrecked secular things, if that is any comfort to them.’ Many liberal warriors are so eager to fight anti-democratic fundamentalism that they end up dispensing with freedom and democracy if only they may fight terror. If the ‘terrorists’ are ready to wreck this world for love of another, our warriors against terror are ready to wreck democracy out of hatred for the Muslim other. Some of them love human dignity so much that they are ready to legalise torture to defend it.
And then in July 2012, writing a column for the Australian Broadcast Corporation’s Religion & Ethics site:
A century ago, G.K. Chesterton clearly deployed the fundamental deadlock of the critics of religion:
“Men who begin to fight the Church for the sake of freedom and humanity end by flinging away freedom and humanity if only they may fight the Church … The secularists have not wrecked divine things; but the secularists have wrecked secular things, if that is any comfort to them.”
Does the same not hold for the advocates of religion themselves? How many fanatical defenders of religion started with ferociously attacking the contemporary secular culture and ended up forsaking any meaningful religious experience?
In a similar way, many liberal warriors are so eager to fight the anti-democratic fundamentalism that they will end by flinging away freedom and democracy themselves if only they may fight terror. If the “terrorists” are ready to wreck this world for love of the another world, our warriors on terror are ready to wreck their own democratic world out of hatred for the Muslim other. Some of them love human dignity so much that they are ready to legalize torture – the ultimate degradation of human dignity – to defend it.
Examples of Žižek’s extensive copying and pasting are numerous. In fact, he began his London Review of Books essay as follows:
Imagine a scene from a dystopian movie that depicts our society in the near future. Uniformed guards patrol half-empty downtown streets at night, on the prowl for immigrants, criminals and vagrants. Those they find are brutalised. What seems like a fanciful Hollywood image is a reality in today’s Greece. At night, black-shirted vigilantes from the Holocaust-denying neo-fascist Golden Dawn movement – which won 7 per cent of the vote in the last round of elections, and had the support, it’s said, of 50 per cent of the Athenian police – have been patrolling the street and beating up all the immigrants they can find: Afghans, Pakistanis, Algerians. So this is how Europe is defended in the spring of 2012.
Compare this to the following passage from The Year of Dreaming Dangerously (p. 13-14):
Imagine a scene from a dystopian movie depicting our society in the near future: ordinary people walking the streets carry a special whistle; whenever they see something suspicious — an immigrant, say, or a homeless person — they blow the whistle, and a special guard comes running to brutalize the intruders…What seems like a cheap Hollywood fiction is a reality in today’s Greece. Members of the Fascist Golden Dawn movement are distributing whistles on the streets of the Athens — when someone sees a suspicious foreigner, he is invited to blow the whistle, and the Golden Dawn special guards patrolling the streets will arrive to check out the suspect. This is how one defends Europe in the Spring of 2012.
Again, from the essay:
There are two main stories about the Greek crisis in the media: the German-European story (the Greeks are irresponsible, lazy, free-spending, tax-dodging etc, and have to be brought under control and taught financial discipline) and the Greek story (our national sovereignty is threatened by the neoliberal technocracy imposed by Brussels). When it became impossible to ignore the plight of the Greek people, a third story emerged: the Greeks are now presented as humanitarian victims in need of help, as if a war or natural catastrophe had hit the country. While all three stories are false, the third is arguably the most disgusting. The Greeks are not passive victims: they are at war with the European economic establishment, and what they need is solidarity in their struggle, because it is our struggle too.
And from The Year of Dreaming Dangerously (p. 13):
Two dominant stories about the Greek crisis circulate in the mass media: the German-European one (the irresponsible, lazy, free-spending, tax-dodging Greeks must be brought under control and taught financial discipline), and the Greek one (their national sovereignty is threatened by the neoliberal technocracy in Brussels). When it became impossible to ignore the plight of ordinary Greeks, a third story emerged: they are increasingly presented as humanitarian victims in need of help, as if some natural catastrophe or war had hit the country. While all three stories are false, the third is arguably the most disgusting: it conceals the fact that the Greeks are not passive victims; they are fighting back, they are at war with the European economic establishment and what they need is solidarity in their struggle, because this is our fight as well.
As I continue reading this book, more and more passages are jumping out at me as strangely familiar. Take, for example, this passage from page 46:
Some months ago, a small miracle happened in the occupied West Bank: Palestinian women demonstrating against the Wall were joined by a group of Jewish lesbian women from Israel. The initial mutual mistrust was dispelled in the first confrontation with the Israeli soldiers guarding the Wall, and a sublime solidarity developed, with a traditionally dressed Palestinian woman embracing a Jewish lesbian with spiky purple hair — a living symbol of what our struggle should be.
And then, from the Guardian article:
Some months ago, a small miracle happened in the occupied West Bank: Palestinian women who were demonstrating against the wall were joined by a group of Jewish lesbian women from Israel. The initial mutual mistrust was dispelled in the first confrontation with the Israeli soldiers guarding the wall, and a sublime solidarity developed, with a traditionally dressed Palestinian woman embracing a Jewish lesbian with spiked purple hair – a living symbol of what our struggle should be.
In fact, both the Guardian and Australian Broadcast Corporation articles are replicated to an astonishing degree in The Year of Dreaming Dangerously. I conducted a side-by-side analysis of the Guardian column and the relevant section of the book and found precious little changed beyond cosmetic reshuffling.
The key issue here is that, in all of the above cases, Žižek’s articles, essays, and books are presented as original pieces of work. In Iraq: The Borrowed Kettle, the Guardian, the London Review of Books, the Australian Broadcast Corporation’s Religion & Ethics site, and The Year of Dreaming Dangerously, Žižek’s words run around in circles, endlessly quoting himself without attribution, adaptation, or citation. And these instances stand in stark contrast to the ones in which Žižek’s re-appropriations were noted correctly, as in his April 24, 2012 article for the Guardian, which noted at the end: “This article is based on remarks Slavoj Žižek will be making at an event at the New York Public Library on 25 April, ahead of publication of The Year of Dreaming Dangerously (2012).”
Self-plagiarism is something of an ambiguous crime, but it is a far different matter when committed across separate publishers who, presumably, assumed they were receiving original pieces of writing. I could have cited even more examples of Žižek’s self-plagiarism from various works (for example, that was not the only London Review of Books essay he would later re-appropriate), but I think the general picture is already quite clear. And given Žižek’s extensive bibliography, it is quite possible that the extent of the recycling is far greater than I have so far discovered.
Upon noticing the enormous amount of copied material in Žižek’s works, I conducted a brief Internet search to determine to what extent this was already a known issue among his most devoted fans. I am certain, given the many examples I have found, that his self-copying is relatively well-known within the passionate community of Žižek readers. And, unsurprisingly, I found a commenter on the Perverse Egalitarianism blog who, on June 15 of this year, wrote:
What surprised me most with regard to editorial side of things is that there is no acknowledgment to other publishers, even when whole chapters are lifted from his other books. The example I have in mind is the Fichte chapter, which is the same as the one found in Mythology, Madness, and Laughter, which was published on Continuum. It seems quite cheeky of Verso to do that. The two contributions by Zizek in The Speculative Turn are also incorporated into LTN. Many passages from The Monstrosity of Christ are reprinted in it too. I know that self-plagiarism is a grey area, and even if Zizek doesn’t care, Verso should. The lack of a bibliography also frustrated me — Verso did the index, so why not the bibliography?
To put Žižek’s self-plagiarism in context, it is helpful to recall the case of Jonah Lehrer from earlier this year. It is easy to forget that, even before the full-blown scandal erupted around his lies, Lehrer had already been embroiled in an earlier kerfuffle involving self-plagiarism as well. One of the numerous instances included the following duplication from a Wall Street Journal article to a New Yorker one. Here is how Lehrer began his article for the Journal:
Here’s a simple arithmetic question: “A bat and ball cost $1.10. The bat costs $1 more than the ball. How much does the ball cost?”
The vast majority of people respond quickly and confidently, insisting the ball costs 10 cents. This answer is both incredibly obvious and utterly wrong. (The correct answer is five cents for the ball and $1.05 for the bat.) What’s most impressive is that education doesn’t really help; more than 50% of students at Harvard, Princeton and the Massachusetts Institute of Technology routinely give the incorrect answer.
Daniel Kahneman, a Nobel Laureate and professor of psychology at Princeton, has been asking questions like this for more than five decades. His disarmingly simple experiments have profoundly changed the way that we think about thinking. While philosophers, economists and social scientists had assumed for centuries that human beings are rational agents, Mr. Kahneman and his scientific partner, the late Amos Tversky, demonstrated that we’re not nearly as rational as we like to believe.
When people face an uncertain situation, they don’t carefully evaluate the information or look up relevant statistics. Instead, their decisions depend on mental short cuts, which often lead them to make foolish decisions. The short cuts aren’t a faster way of doing the math; they’re a way of skipping the math altogether.
Although Mr. Kahneman is now widely recognized as one of the most influential psychologists of the 20th century, his research was dismissed for years. Mr. Kahneman recounts how one eminent American philosopher, after hearing about the work, quickly turned away, saying, “I am not interested in the psychology of stupidity.”
Here’s a simple arithmetic question: A bat and ball cost a dollar and ten cents. The bat costs a dollar more than the ball. How much does the ball cost?
The vast majority of people respond quickly and confidently, insisting the ball costs ten cents. This answer is both obvious and wrong. (The correct answer is five cents for the ball and a dollar and five cents for the bat.)
For more than five decades, Daniel Kahneman, a Nobel Laureate and professor of psychology at Princeton, has been asking questions like this and analyzing our answers. His disarmingly simple experiments have profoundly changed the way we think about thinking. While philosophers, economists, and social scientists had assumed for centuries that human beings are rational agents—reason was our Promethean gift—Kahneman, the late Amos Tversky, and others, including Shane Frederick (who developed the bat-and-ball question), demonstrated that we’re not nearly as rational as we like to believe.
When people face an uncertain situation, they don’t carefully evaluate the information or look up relevant statistics. Instead, their decisions depend on a long list of mental shortcuts, which often lead them to make foolish decisions. These shortcuts aren’t a faster way of doing the math; they’re a way of skipping the math altogether. Asked about the bat and the ball, we forget our arithmetic lessons and instead default to the answer that requires the least mental effort.
Although Kahneman is now widely recognized as one of the most influential psychologists of the twentieth century, his work was dismissed for years. Kahneman recounts how one eminent American philosopher, after hearing about his research, quickly turned away, saying, “I am not interested in the psychology of stupidity.”
The New Yorker, upon being informed of the self-plagiarism, immediately included apologetic notes at the top of affected Lehrer articles, such as the following one for the above piece: “Editors’ Note: The introductory paragraphs of this post appeared in similar form in an October, 2011, column by Jonah Lehrer for the Wall Street Journal. We regret the duplication of material.”
Again, the issue in this case was not simply that Lehrer borrowed from his own earlier works, but that he did so a) without the knowledge of his publishers and b) without, therefore, a disclaimer to the readers.
(Speaking of disclaimers: I have also been published on the Australian Broadcast Corporation’s Religion & Ethics site for a piece adapted from a post on this blog. Of course, the editor, Scott Stephens, was fully aware of the original post, which is why he had wanted to adapt it in the first place. And I had also explicitly mentioned, in another blog post, the adapted nature of the published piece, calling it a “slightly revised version” of my original writing. [The published iteration is also, I think, a far better one thanks to Stephens’ editing.] The published piece also included a note at the bottom linking to my blog. Nevertheless, I should have insisted on including an explicit notice of the adaptation in my blurb at the bottom of the published piece as well, which I did not do.)
Slavoj Žižek’s sin is not in reformulating long-held ideas into new books, something many authors do. It is in copying (nearly without modification) large sections of other works of his without attribution, and while simultaneously presenting each work as an original piece of writing. The extraordinary pressure on today’s writers, ranging from promising young journalists such as Jonah Lehrer to world-renowned philosophers such as Slavoj Žižek, to maintain prolificacy in the age of shortened attention spans is surely to blame for the graying hairs of many an aspiring writer. But it is no excuse for repackaging something old as something brand-new.
Slate‘s Jacob Silverman is worried about the Internet literary community’s impact on critics’ ability to be honest:
Reviewers shouldn’t be recommendation machines, yet we have settled for that role, in part because the solicitous communalism of Twitter encourages it. Our virtue over the algorithms of Amazon and Barnes & Noble, and the amateurism (some of it quite good and useful) of sites like GoodReads, is that we are professionals with shaded, informed opinions. We are paid to be skeptical, even pugilistic, so that our enthusiasms count for more when they’re well earned. Today’s reviewers tend to lionize the old talk-show dustups between William F. Buckley and Gore Vidal or Noam Chomsky (the videos are on YouTube), but they’re unwilling to engage in that kind of intellectual combat themselves. They praise the bellicosity of Norman Mailer and Pauline Kael, but mostly from afar. Mailer and Kael are your rebellious high school friends: objects of worship, perhaps, but not emulation. After all, it’s all so messy, and someone might get hurt.
Instead, cloying niceness and blind enthusiasm are the dominant sentiments. As if mirroring the surrounding culture, biting criticism has become synonymous with offense; everything is personal—one’s affection for a book is interchangeable with one’s feelings about its author as a person. Critics gush in anticipation for books they haven’t yet read; they <3 so-and-so writer, tagging the author’s Twitter handle so that he or she knows it, too; they exhaust themselves with outbursts of all-caps praise, because that’s how you boost your follower count and affirm your place in the back-slapping community that is the literary web. And, of course, critics, most of them freelance and hungry for work, want to appeal to fans and readers as well; so to connect with them, they must become them.
First, for the good journalism, which I will quote at length (think of it as a counterexample to yesterday’s post about Jake Tapper’s misconception of media fairness):
Does any journalist who is not an overt shill for the right actually believe that Republicans are pushing voter ID laws because they’re concerned about voter fraud?
No, of course not.
And for good reason. Voter fraud simply isn’t a problem in this country. Studies have definitively debunked the voter fraud myth time and again.
In Pennsyvlania, which just adopted a tremendously restrictive photo-ID law that could disenfranchise 1 in 10 voters, state officials conceded they have no evidence of voter fraud, nor any reason to believe it could become a problem…
And the pursuit of this goal ostensibly in the name of voter fraud is an outrageous deception that only works if the press is too timid to call it what it really is.
For reporters to treat this issue like just another political squabble is journalistic malpractice. Indeed, relating the debate in value-neutral he-said-she-said language is actively helping spread the lie. After all, calling for someone to show ID before voting doesn’t sound pernicious to most people, even though it is. And raising the bogus issue of voter fraud at all stokes fear. “Even if you say there is no fraud, all people hear is ‘fraud fraud fraud’,” said Lawrence Norden, a lawyer at the Brennan Center for Justice at New York University School of Law.
Think about it. If you were covering elections in another country, and one political party was actively trying to limit voting in the name of a problem that objectively didn’t exist, would you hesitate for a moment to call out that tactic — and question that party’s legitimacy? Hardly.
Modern American journalists strive for impartiality, but there is a limit. Mainstream journalists shouldn’t be afraid of being accused of taking sides when what they’re doing is standing up for basic constitutional rights. Indeed, the greater danger is that readers condemn them — or even worse, stop paying attention to them — for having no convictions at all, and no moral compass.
The GOP has taken increasingly radical positions, confident that the media’s aversion to taking sides will protect it from too much negative coverage. But failing to call out the voter ID push is like covering the civil rights movements and treating “separate but equal” as if it was said with sincerity.
And now, for the bad writing (on the part of Lehrer, not Moynihan):
Yesterday, Lehrer finally confessed that he has never met or corresponded with Jeff Rosen, Dylan’s manager; he has never seen an unexpurgated version of Dylan’s interview for No Direction Home, something he offered up to stymie my search; that a missing quote he claimed could be found in an episode of Dylan’s “Theme Time Radio Hour” cannot, in fact, be found there; and that a 1995 radio interview, supposedly available in a printed collection of Dylan interviews called The Fiddler Now Upspoke, also didn’t exist. When, three weeks after our first contact, I asked Lehrer to explain his deceptions, he responded, for the first time in our communication, forthrightly: “I couldn’t find the original sources,” he said. “I panicked. And I’m deeply sorry for lying.”
I don’t join the stampede of writers and journalists jumping up and down on Jonah Lehrer’s grave out of a barely concealed sense of schadenfreude. The amount of pressure and panic that he must have felt in order to do this had to have been immense. That doesn’t excuse it. But it certainly isn’t cause for celebration by anyone else either.
Ostensibly the panel had gathered to discuss whether E.L. James’s blockbuster book was a step forward for American sexual culture. “I just want to say right off the bat that we are not going to be discussing the book’s literary merit,” said McNally Jackson’s Amy Lee, the moderator for the event. Yet despite this disclaimer, many of the panelists seemed unable to resist taking a few cheap shots at its notoriously clumsy prose, referring to the book repeatedly as a “piece of shit.”
Ms. Jong seemed especially preoccupied with the book’s literary offenses. “What possessed the publisher to not even edit the book?” she began. “I don’t believe anyone ever said ‘holy cow’ at the moment of her first orgasm,” she said disdainfully, voicing a familiar criticism that she would repeat more than once before the end of the night.
My two cents? Methinks literary greatness isn’t what E.L. James was shooting for. I’m sure she has more than enough cash now to buy herself an editor or 70. But why bother?
Ever since I fell in love with Jernigan I’ve been drawn to books with one-word titles – partly because Sonny Mehta loves one-word titles, but mainly because they can be so enviably concise and memorable, so perfect. At their best, one-word titles distill content to its purest essence, which is what all titles strive to do, and then they stick in the mind. Sometimes, of course, they fall flat, and much of the time they’re just lukewarm and vague or, worse, falsely grand.
Weirdly, I’ve always thought long names for movies (and perhaps books as well) were positively correlated with the indie-ness of the film. Thoughts?
I’ll say this for the guy: he has a “spectacular” sense of timing. In the great debate over economic fairness, income disparities, the unjustness of the tax system, and other such issues, it seems that the last thing the majority of the country is interested in hearing is a spirited defense of the status quo. But maybe I’m wrong. We are the nation that turned Glenn Beck into a superstar, after all. What’s the matter with Kansas, indeed.
The front cover of Jackass Investing is adorned with images of hundred-dollar bills strewn about in haphazard fashion. The subtitle is “Don’t do it. Profit from it.” Inside, the content is structured not by chapters, but by “myths” that Michael Dever methodically busts one by one. He does this, he emphasizes time and time again, to save the reader from accumulating a “poor-folio.” Even the design of the book’s web site, www.jackassinvesting.com, seems one small nudge away from that of a low-budget Ponzi scheme.
So one can forgive me, I hope, when I confess that these elements immediately recalled for me the overly-gesticulative, used-car salesman aura of Mad Money‘s Jim Cramer. Dever, the founder of Brandywine Asset Management, is not gun-shy with his similes. But I soon learned not to conflate style with substance. Jackass Investing is a very useful book indeed, not least for the clear language Dever uses to rapidly rebut decades of conventional wisdom in the world of investments.
As a relative novice to active investing (I am, however, the proud owner of an E-Trade account and a quickly depleting “poor-folio” of international stocks), I would be hard-pressed to counter Dever’s claims with fact-finding of my own. But that, in a sense, is what makes this book so compelling: the common-sense nature of each of his principles is immediately obvious to financiers and laymen alike.
Dever is especially harsh on the oft-cited philosophy of “buy-and-hold,” a mantra often repeated by the chattering class on TV but which represents, in the author’s words, “neither rocket science nor sound investment advice.” Buy-and-hold is uniquely favorable to a bull market but not much else, and thus its usefulness to investors has “shriveled together with the values of their stock portfolios throughout the secular bear market that began in 2000.”
Jackass Investing is singularly concerned with “return drivers,” those forces pushing specific assets up in value. For much of the last several decades, both individual and institutional investors generally invested in stocks, bonds, and other assets based on the general upward trend of the market, without paying closer attention to the underlying problems. The price/earnings (P/E) ratio was usually increasing as well, signaling that investors were jumping on the bandwagon and were comfortable paying more for the same stock than they would have during a bearish run.
Dever opts instead for a novel trading strategy, one that is simultaneously intuitive and counter-cultural. He carefully explains why experts are not to be trusted, disavows readers of the myth that ratings agencies can protect them from bad investment strategy, and, perhaps most importantly, emphasizes that portfolio diversification is both absolutely vital and almost universally ignored.
“Portfolio diversification,” Dever declares, “is the financial equivalent of magic.” For years, diversifying one’s holdings has usually been defined as taking positions “across multiple asset classes in order to diversify their risk.” In reality, however, many stocks, bonds, and real estate assets are supported by similar return drivers, thus exposing themselves to “event risk.” If the underlying stimulus factor changes or shifts, all holdings — regardless of asset class — could decrease sharply in value.
True diversification, then, means dipping one’s toes into unfamiliar waters. Dever goes into great detail on home-team bias, the principle (unconscious or otherwise) by which investors stick to the familiar, better-known assets, leaving potentially high-value stocks and other financial instruments out of their planning with nary a second thought. “For example,” Dever explains, “while the U.S. equity markets account for just over 30% of the total capitalization of all the world’s equity markets, U.S. institutional investors allocate more than 50% of their money to U.S.-listed companies…Japanese institutions hold more than 80% of their money in Japanese companies, despite Japanese markets accounting for less than 9% of the world’s capitalization.” By shutting oneself out of foreign markets (or futures contracts, or commodities trading, or any other market conventionally deemed overly risky), one is severely limiting significant money-making opportunities.
Here’s where Dever’s approach becomes slightly ambiguous. As I see it, the continued existence of longstanding tropes such as buy-and-hold is due to the absence of a simple alternative. Fundamentally, Dever’s ideas fall into that category. But while the ideas themselves may be easy to grasp, the execution requires a lot more work than its buy-and-hold counterpart. Whereas the latter can be accomplished simply by purchasing a collection of assets and virtually ignoring it thereafter, the former necessitates a more hands-on approach, in which thorough research, investigation, and asset selection all play major roles. Dever would argue that such background work is required for all forms of investing, and that failure to do so will inevitably result in sub-par returns. The question, then, is whether his approach excludes investors without much time on their hands.
I also would have preferred to see more examples of actual trading strategies presented in opposition to the myths Dever debunks in each section. For this he continually refers readers to his web site instead.
Jackass Investing, then, far surpassed my shallow initial judgments and provided clear insights into investing strategies that, as Michael Dever writes, “should not be controversial, but…will be.” Hell, I even logged in to my E-Trade account a few chapters — nay, myths — in, sold off my under-performing BP stock, and loaded up on Renren, a Chinese social network. After all, if 1.3 billion people with rapidly increasing Internet access isn’t a damn strong return driver, I just don’t know what is.
The following two snippets aren’t necessarily related, but they’ve been percolating in my mind for a few days now, so I thought I’d include a little of each.
1) Buy Andrew Bacevich’s book Washington Rules: America’s Path to Permanent War. Bacevich is currently a professor of history and international relations at Boston University and was formerly a colonel in the U.S. Army. Washington Rules is a deeply insightful critique of what Dwight Eisenhower so presciently labeled the “military-industrial complex.”
“The Washington rules” of the title, Bacevich explains in his introduction, “were forged at a moment when American influence and power were approaching their acme. That moment has now passed.” What follows is a brilliant historical overview of the American drift from moderate isolationism to strident interventionism. Bacevich, like many on the disaffected left, fears perpetual war. Entrenched interests in both the public and private sectors never cease to make use of fear-mongering tactics to frighten a restive population into acquiescence. This is how the CIA and Strategic Air Command, two institutions whose central role in establishing American militarism is thoroughly dissected in Washington Rules, managed to upend decades upon decades of American reluctance to flex its muscles in the global arena.
It is also how the United States finds itself enmeshed in three simultaneous wars right now. The legacy of George W. Bush and Osama bin Laden (and yes, their legacies are forever linked) is not simply the overreaction, the blind rage that led the United States into endless wars against unseen enemies with unclear objectives, all accompanied by the impossibility of victory. More enduring still is the zombie-like, unquestioning deference with which American citizens approach their warrior-leaders. Bush accomplished in eight years what the decades-long Cold War never could: permanent war, it seems, has become the new norm. Civil liberties are but a noble casualty along the way.
All one needs to do to confirm this sudden, collective disavowal of the pursuit of peace is to witness the nearly inaudible protest to President Barack Obama’s decision to intervene in the Libyan revolution. Where the war in Iraq invited some (albeit relatively muted, especially in light of the still-heightened emotions following September 11) immediate condemnation, our Libyan incursion barely raised eyebrows. Osama bin Laden may be dead, but the terror attacks he masterminded laid bare an uncomfortable truth: it takes very little to galvanize the American public in support of a perceived cause, however dubious the rationale and however vague the endgame.
Washington Rules was published in 2010, before the Jasmine Revolution and before today, when the key provisions of the Patriot Act that authorize controversial surveillance techniques were renewed for four years by Congress, despite the warnings of two U.S. senators that the bill is being interpreted in very dangerous ways. One can only imagine the blistering new foreword Bacevich could pen now.
2) Israeli prime minister Benjamin Netanyahu’s speech to Congress this week was chock-full of half-truths, prevarications, and outright lies. In fact, his entire visit to the States was an exercise in exaggeration and hyperbole, as the reaction he provoked following Obama’s speech on the Middle East was completely unwarranted. Obama stated that Israeli-Palestinian borders must be based on the 1967 lines, something every American and Israeli leader has known for years. (This includes Netanyahu himself as recently as six months ago.)
Ultimately, Netanyahu is a coward, and his intransigence will only harm Israel in the long run. What I found far more disturbing was the appalling sycophancy displayed by the United States Congress, which was roused to twenty-nine standing ovations, including once — inexplicably — that immediately followed Netanyahu’s statement that Israel was not occupying Palestinian land.
As Glenn Greenwald of Salon has demonstrated on many occasions, American politicians’ obsequiousness to the Israeli right-wing knows no bounds. This absurd rubber-stamping (not to mention heavy financing) of what is in many ways a racist regime owes in large part to the enormous influence of the Israel lobby (yes, the one so strongly debated following the eponymous book by Walt and Mearsheimer).
But a word of caution may be in order. As any sane person who follows Middle Eastern politics with even a passing interest knows, yes, the Israel lobby is indeed a powerful force, perhaps the most influential outside group (especially in proportion to its immediate constituency, American Jews) affecting American politics today. One of the hallmarks of this lobby is to stifle any critique of Israel, no matter how thoughtful or well-reasoned, by using the threat of being branded an anti-Semite as a deterrent.
Of course, anti-Semitism does exist, and whether it’s John Galliano or Lars von Trier spouting racist ideas in public, it’s wrong, always. But wielding the “anti-Semite” label as a baton in order to smother dissent is not just wrong, it’s undemocratic. The dilemma, then, lies in criticizing the lobby itself. Care must be taken to avoid being perceived as an adherent of the age-old, harebrained conspiracy theories that “Jews control the media,” “Jews control the government,” and so on. They do not. But they do, unlike many underrepresented minority groups in the U.S., exert enormous influence on American policy. To acknowledge this fact is not to exhibit anti-Semitism; it simply proves one has eyes and ears.
A crucial distinction is in order, then. The Israel lobby exists, and it is powerful. But it is not synonymous with Judaism, nor even American Judaism. AIPAC, while purporting to act on behalf of both American Jews and the state of Israel, in reality is little more than a well-connected conduit between the most radically right-wing voices in both camps and the United States government. So while many are understandably reluctant to give voice to their misgivings about the Israel lobby for fear of conflation with actual anti-Semites, it is vital to differentiate between criticism of Israeli policies and hatred of a race. It is also important to remember that AIPAC, in portraying itself as the public mouthpiece of Jews in both the U.S. and Israel, is actually doing both nations a huge disservice in its unquestioning support of continually failing policies. It is only when reasoned criticism becomes the norm that the United States and Israel will both be able to enact sensible policies with regard to the Holy Land.