What Have We Learned from the Meng Extradition "Catastrofarce"?

The "Catastrofarce"

In his review of Mike Blanchfield and Fen Osler Hampson's book, The Two Michaels, David Moscrop characterizes the #Meng extradition case as a mix of catastrophe and buffoonery.  To describe the three-year-long "farce," Moscrop suggests the neologism "catastrofarce."  "When all was said and done," Moscrop points out, "nothing was achieved and everyone involved came out poorer than when they had started." True enough, but now we can reflect on all that we have learned from the affair, right?  No?

Sometimes you can judge a book by its cover

Moscrop assesses The Two Michaels as "a missed opportunity" as it failed to probe the context of a "Cold War between the United States and China."  The Two Michaels left much unsaid.  Obviously, a close focus on "The Two Michaels" as "Innocent Canadian Captives" was bound to exclude details of the broader issues.  Blanchfield and Osler Hampson's review of the Michaels' harsh conditions in contrast to the luxury of Meng's Vancouver mansions seemed the same insistence on the marginally relevant reiterated by Canada's legacy media for three years, the same pandering to imagined Canadian sensibilities--"pandas really aren't nice like beavers"--which I attempted to mock in The Panda and the Beaver.

What The Two Michaels leaves unsaid

Despite the subtitle, The Two Michaels has relatively little to say about "the US-China Cyber War."  In the dozen or so times "cyber war" is mentioned, the book's most interesting observation is left largely undeveloped:

Whatever the differences in their circumstances, Michael Kovrig, Michael Spavor, and Meng Wanzhou were now bound by one shared reality. All three were pawns in a full-blown technology war for control over global communications [. . . .]

 I noted the authors' excluding relevant  detail in the early going of The Two Michaels when I read this sentence:  "The US and Iran have been enemies since 1979, when a group of radical students in Tehran stormed the American embassy and took hostages in a siege that lasted 444 days."  Dating the beginning of US-Iranian enmity to 1979 and attributing the Iranian revolution to "a group of radical students" leaves unsaid that the USA arranged the overthrow of Mohammad Mosaddegh, the democratically-elected leader of Iran, then installed and maintained an "oppressive, brutal, corrupt," 26-year-long dictatorship under the playboy Shah Reza Pahlavi in order to protect Anglo-American oil interests.

What about Richard Donoghue?

Donoghue's name, of course, gets mentioned in the Blanchfield & Osler Hampson monograph, as he issued the warrant, conducted the grand jury trial, and argued that Meng Wanzhou should be kept behind bars while awaiting extradition.  The rapid rise and fall of Donoghue's career was directly aligned with the pursuit, arrest and attempted extradition of Meng Wanzhou.  Donoghue's position as a litigator for CA Technologies to becoming US Attorney for the Eastern District of New York in 2018 to being named Assistant Attorney General to his disappearance from the spotlight paralleled Meng's indictment, arrest and eventual release.  Blanchfield and Osler Hampson have virtually nothing to say about him, never question his background or motives, barely even mention his central role in the "catastrofarce."

And Jody Wilson-Raybould?

Jody Wilson-Raybould was the Minister of Justice responsible for Meng Wanzhou's arrest and the early stages of issuing an Order to Proceed with her extradition.  Wilson-Raybould had the ministerial authority, by law, to dismiss the American request and release Meng "at any time" and put an end to the "catastrofarce" which led to Michael Korvig and Michael Spavor's imprisonment.  Nonetheless, her name appears exactly once in The Two Michaels, in the context of her having been pressured by PM Trudeau and his minions to stop the criminal prosecution of SNC-Lavalin.  As I have written in previous posts, it mattered that the SNC-Lavalin scandal, the Meng extradition case and JWR's demotion out of justice were all happening at the same time.  (See "Comparing 'Remediation Agreements' and the Canadian Extradition Act, or Did the Liberal Obsession with SNC-Lavalin Prevent Jody Wilson-Raybould from Dealing with the Meng Extradition?")

In The Two Michaels, former Minister of Justice Allan Rock reaffirmed my speculations that fall-out from the SNC-Lavalin scandal made the government reluctant to act on the Meng extradition.  Supreme Court Justice Louise Arbour also confirmed that the government was getting the laws governing Remediation Agreements and those governing extradition upside down.  As I pointed out in "A Comparison of Scandals: SNC-Lavalin Versus the Extradition of the Huawei CFO," the government tried to interfere when the law clearly proscribes interference and refused to act when "the law clearly spells out that political (Minister of Justice) action is not just accepted but expected and required."

Oddly (or does this have something to do with ministerial privilege and secrecy?), in JWR's recent memoir, Indian in the Cabinet, there is not a single mention of the Meng extradition case.  Does Jody Wilson-Raybould recognize that her most consequential act over the course of her tenure as Minister of Justice/Attorney General was to authorize the arrest of Meng Wanzhou, or does her preoccupation with the SNC-Lavalin scandal and her demotion out of justice continue to cloud her judgment of the case and her role in it?

Canada Was being played

Was Canda being played?  For an answer look no further than Adrienne Arsenault's interview with John Bolton on CBC.  Arsenault pointed out (Blanchfield & Osler Hampson also note) that after the warrant for her arrest had been issued (22 August 2019),  Meng traveled to the UK and France.  Both countries have extradition treaties with the USA.  Why wait until she was traveling through Canada?  Was it because the Americans judged that only Canada would be "compliant" (and dumb?) enough to follow through on the extradition request?  In response to Arsenault's question, Bolton smiled and giggled slightly, then recovered himself enough to say "it was a matter of logistics" and Canada's being played was "a conspiracy theory."  As I have suggested elsewhere, just because it's a conspiracy theory doesn't mean it isn't true. (See "The Chaos Theory of International Trade, or How Canada Arrested a Chinese Executive on a US Warrant in Order to Protect Israel from Iran.")

The USMCA trade agreement and the "China clause"

Of course, Canada was being played, and the con job is still unfolding.  The same year we were asked to arrest Meng, Canada was negotiating the USMCA trade agreement (the replacement for NAFTA).  The Americans asked for and the Canadian negotiators agreed to the “China clause” requiring three months notice before Canada could sign a trade agreement with  “non-market countries.”  (The list of “non-market countries” includes China, Vietnam, North Korea and 11 others.)  What sovereign nation would give up its right to unfettered trade negotiations?

Just in case forewarning would not be enough to block Canada's trade with China, the USA requested and Canada acquiesced in arresting Meng thereby guaranteeing, entirely for US benefit, a breakdown in the collaboration between Canada and China which had been developing for 50 years under both Conservative and Liberal governments. We, Canadians, might imagine that the self-sacrificing gesture of arresting Meng at the US request would win some future gratitude and consideration from our American neighbours.  Exactly the opposite has been playing out.  With trade between Canada and China stymied, Canada had even less leverage than usual with the USA.  This period of animosity between China and Canada was/is exactly the right moment for the USA to put the squeeze on Canada--and that is what has been happening:

• PEI potatoes: banned from export to the USA. In 2020, the USA signed a deal to export Idaho and Washington potatoes to China.

• Softwood lumber: Canada's trade dispute with the USA has been going on since 1982. The WTO (World Trade Organization) has ruled several times that the US tariffs are unreasonable. In 2021, the USA doubled the duty on Canadian softwood lumber to 17.9%. China is the world's second-largest importer of softwood lumber

• Trump's "Trade truce": As reported in The Two Michaels, "Trump’s subsequent 'trade truce' with China, signed on January 16, 2020, left Canada dangling in the wind. [. . . .] [It] committed China to buy an additional US$200 billion in American goods over the next two years, including US$40 billion to US$50 billion in agricultural products such as soybeans, canola, fresh and frozen pork, beef, wheat, corn, barley, and a range of machinery, all on preferential terms unavailable to Canadian producers."

• Electric vehicles made in the USA: Canada's second-largest export to the USA (after oil and petroleum products) is vehicles. President Biden's new legislation requiring that electric vehicles be produced in the USA would effectively shut Canada out of the American market. 

Ironically, Canada is currently trying to negotiate a free-trade deal with ASEAN (the Association of Southeast Asian Nations) which includes Vietnam (a non-market country).  Presumably, according to the "China clause," Canada will have to officially inform the USA in advance of signing a deal.  For what purpose?  Why would the US negotiators demand advanced notice, if not to consider how the deal accommodates American interests and to scuttle it if it doesn't.  Since China is the ASEAN's largest trading partner and is planning to upgrade its relationship, Canada will have to kowtow to both China and the USA--neither of whom have reason to support Canada's free-trade aspirations--in order to sign an agreement.

What I Gleaned from The Two Michaels

In November 2019, a Canadian delegation led by Alan Rock met with Chinese officials in China to discuss the Meng arrest and the incarceration of the two Michaels.  The leader of the Chinese delegation, Wang Chow, insisted that there was no connection between the two cases--a claim we can now easily categorize as a lie.  But, at the same time, Wang quoted Section 23 of the Canadian Extradition Act,  demonstrating that Canadian claims that politicians could not get involved in an extradition case were patently false.  Canadians may not know the Canadian Extradition Act, but the Chinese delegation certainly did. 

Blanchfield & Osler Hampson describe the Chinese delegate's quoting of Section 23 of the Canadian Extradition as exploiting "an inherent loophole in the government’s argument." "Loophole" here appears a euphemism for a "lie."  Rock attempted to argue that Section 23 was "was not necessarily intended for this kind of case" and that it was "extremely rare" for the Minister to halt extradition proceedings.  Rock was quick to admit that it was a feeble argument and "a non-satisfactory response."  Ironically, returning to Canada, Rock, backed by extradition expert Brian Greenspan's investigation and report, presented the same Section 23 argument to Justin Trudeau that, by law, according to the Canadian Extradition Act, the Minister of Justice could release Meng at any time.

Who Is Greta Bossenmaier?

"Greta Bossenmaier" is a name I had never heard before.  Blanchfield and Osler Hampson identify her as Justin Trudeau's "national security advisor" and quote her briefing notes to the PM stating: “The minister has broad discretion to decide, but [. . . ] there are no examples of the Minister discharging a case for political or diplomatic reasons.”

While giving the impression that Bossenmaier was a key player in the decision to hold Meng, Blanchfield and Osler Hampson give no further information about her.  According to my internet search, Bossenmair began her career as a DND scientist, worked for several departments in the public service and was named head of CSIS (Canadian Security and Intelligence Service) on May 23, 2018--six months before Meng was arrested.  Bossenmaier was appointed to the position when her predecessor, Daniel Jean, retired, and retired herself in December 2019.

Bossenmaier's claim that "there are no examples of the Minister discharging a case [. . . .]" was clearly beside the point.  There are no equivalent cases, no precedents for Canada's arresting a Chinese executive on a questionable extradition request from the USA.  The Canadian Extradition Act wasn't the problem; it was the solution.  It laid out step by step exactly what should be done, what must be done, how and why.  It was "paint by numbers," if Canadian politicians could be convinced to follow the instructions.   The Minister of Justice could and should refuse the extradition request because [46 (1) (c)]  it was for "an offence of a political character."  The Minister could and should refuse:

 [ . . .] if the request for extradition is made for the purpose of prosecuting or punishing the person by reason of their race, religion, nationality, ethnic origin, language, colour, political opinion, sex, sexual orientation, age, mental or physical disability or status or that the person’s position may be prejudiced for any of those reasons. 

The US DoJ (Department of Justice) had cornered HSBC (Hong Kong Shanghai Banking Corporation) into providing evidence that they had been fooled by Meng Wanzhou into moving money in Iran.  HSBC had to go along with the claim that  Meng committed "bank fraud" or, for the second time, pay heavy fines in the USA for financial transactions in Iran.  Could there be any doubt that Meng was being pursued because she is Chinese, because China is a communist country in a Cold War with the USA?  Could there be any doubt that her position in the USA would be prejudiced for reasons of nationality and politics? Could there be any doubt that had she been German, British, French or Swiss and using Deutsche Bank, Standard Charter Bank, Societe Generale, or Credit Swiss (all of whom have been caught and paid fines for transactions in Iran) the USA would never have even considered a criminal proceeding against her for "bank fraud"?  The Canadian Ministers of Justice had only to judge the obvious and yet it appears that neither Jody Wilson-Raybould nor David Lametti ever did.

The Mystery of RCMP Staff-Sergeant Ben Chang

Not surprisingly, given how soon after the Meng and "two Michaels" saga the book was published, there are gaps in the narrative of Meng's arrest.  Blanchfield & Osler Hampson begin the story in medias res when RCMP "Const. Winston Yep’s cellphone rang."  Yep's supervisor was calling with instructions to arrange a warrant for Meng's arrest.  "Yep was successful in persuading British Columbia Supreme Court Justice Margot Fleming to issue a warrant."   But who was Yep's supervisor on the other end of the phone call? Who was giving orders to Yep's supervisor? When Yep finally informed Meng that she was under arrest, he said: "[. . . ] this is a warrant for provisional arrest under Section 13 of the Extradition Act.”  

Section 13 specifies: 

13 (1) A judge may, on ex parte application of the Attorney General, issue a warrant for the provisional arrest of a person, if satisfied that there are reasonable grounds to believe that

(a) it is necessary in the public interest to arrest the person [ . . .]

The authorization was supposed to come from the Attorney General of Canada (Jody Wilson-Raybould), but the narrative suggests orders and instructions were coming from the FBI.

Reading through the details of Meng's arrest brought back memories of my visit to the Canadian Museum of Human Rights in Winnipeg where a copy of the Magna Carta was on display.  

The Canadian Charter of Rights and Freedoms contains clauses with precedents dating back to Magna Carta. Section 9 of the Charter guarantees freedom from arbitrary detainment or imprisonment while section 10 guarantees habeas corpus. Both rights can be traced back to Magna Carta.

On instructions from the FBI passed on to the RCMP and from the RCMP to the CBSA (Canadian Border Security Agency), Meng was "arbitrarily detained" for three hours. The "Canadian Charter" is explicit: 

10 Everyone has the right on arrest or detention

(a) to be informed promptly of the reasons therefor;

Only after three hours of detention, interrogation, and being required to give up the passwords for her cellphone and computer (which were passed on to the FBI) was Meng informed that she was being arrested for "bank fraud."  Canadian officials blithely overstepped the Canadian Charter (and the 800-year-old Magna Carta for god's sake), and the media response was to massage the Canadian national ego with reports that we were all "law-abiding" citizens in a "rule-of-law" country.

As reported in The Two Michaels, Canadian Border Security Agent Scott Kirkland immediately intuited that Meng's detention would be a contravention of the Canadian Charter, but still "had a job to do." The great mystery of the imbroglio remains Staff Sergeant Ben Chang, described in The Two Michaels as "a senior RCMP officer [ . . .] who had dealings with an FBI counterpart, John Sgroi, in the days following Meng’s arrest."

Chang retired from the RCMP and moved to China (!?), "where he now works in security at a casino" in Macau. Chang left behind an affidavit swearing that he did not share information with the FBI but refused to testify at the extradition hearing. 

"The Gang of 19"

In 2020, Allan Rock, former Liberal Minister of Justice, and Louise Arbour, former Supreme Court Justice and UN High Commissioner for Human Rights sent a letter to Justin Trudeau pointing out the justice of releasing Meng.  There was no response, not even an acknowledgment of receipt.  Blanchfield and Osler Hampson opine:  "The Trudeau government chose not to offer a basic courtesy to two Canadians who had served their country with great distinction."

As Blanchfield and Osler Hampson report, on June 23, 2020, 

a group of former government officials, senior diplomats (including two former Canadian ambassadors to Washington), and academics sent a confidential letter to the prime minister suggesting that it was time to release Meng in exchange for the Two Michaels.

Was there a conspiracy afoot?  Within twenty-four hours the letter

was leaked by an unknown source to a variety of Canadian news outlets. Both the letter and photos of the Gang of 19, as they were now called, were plastered on television screens across the nation in what looked like a police lineup. Rock and his co-signatories knew immediately that their enterprise was doomed.

Was there a campaign across Canadian media to discredit Rock and Arbour and seventeen other distinguished Canadians?  What editor or producer would willingly agree to describe this group of renowned Canadians as "a gang"?  Still worse, "Gang of 19" was an allusion to the "Gang of Four," a brutal, repressive, and regressive cadre prominent in the final years of Mao's "Cultural Revolution."

Justin Trudeau's Stubborn resistance

Twenty-four hours after receiving Rock and Arbour et al's appeal to release Meng and save the two Michaels, Justin Trudeau gave a press conference and, with uncharacteristic firmness, announced that the government would not engage in hostage diplomacy.  I had speculated that after having panicked when presented with the original extradition request, Trudeau had no choice but to continue promoting the falsehood that extradition was an independent judicial process. 

As I learned from The Two Michaels, Trudeau's decision was likely predetermined by his refusal, in 2015, to negotiate with Abu Sayyaf, a militant Islamist group in the Philipines, who were holding two Canadians, Robert Hall and John Ridsdel, and a Norweigan, for ransom.  The Norweigan, Kjartan Sekkingstan, was released after a ransom of $638,000 was paid (according to a spokesman for Abu Sayyaf).  The two Canadians were beheaded.

Robert Fowler, a former UN ambassador, who had himself been held hostage by Al-Qaeda, was adamant that the Trudeau government's refusal to negotiate the two Michaels' release was predetermined by Trudeau's refusal to negotiate for Hall and Ridsdel's release, and was "naive, simplistic, and in this case potentially murderous”  (qt in The Two Michaels).

Hostage Diplomacy

As I pointed out in December 2018, the Chinese arrest of the two Michaels made the optics of releasing Meng more difficult.  The Two Michaels offers extensive discussion of "hostage swap" situations.  The general pattern seems to be that, although official government policy is, typically, to refuse to negotiate for the return of hostages, Western democracies and the USA, in particular, frequently find a way around their own public policies. However, discussions of Meng's release in terms of "hostage diplomacy" or "prisoner swap" or "hostage exchange" consistently obscured the fact that in releasing Meng, Canada would be following the law, not breaking it.

Blanchfield & Osler Hampson claim that Canadians, according to an Angus Reid poll, massively supported Trudeau's decision not to release Meng.  The problem with the Angus Reid poll was that their question offered only two possible answers, and both answers were wrong:

Respondents to the survey had to choose between:  🟥 break the law (intervene) or 🟦follow the law (continue).  Of course, Canadians responded that we should follow the law.  If Canadians had been told and the question framed accordingly that to "intervene" would be following the law as specified in the Extradition Act and to "continue" was to ignore the law, I imagine Canadians would have responded in exactly the reverse of the numbers provided in the graph above.

What Did Meng confess to?

The two Michaels are home.  Meng returned to China to a hero's welcome.  Dare we consider a cost-benefit analysis?  Canada paid a heavy price for arresting Meng:   over 1000 days in prison for the two Michaels, blocked Canadian imports of beef, pork, and canola, the collapse of a plan for Covid vaccines to be produced in Canada.  The future costs of the breakdown of our trade and diplomatic relations with China are yet to be calculated.  

What did we gain?  Canada showed that we would not be bullied, that we were an independent nation of law-abiding citizens and politicians who followed the rule of law.  Except we weren't following the law and, therefore, we were not being law abiding and, by all appearance, we were being bullied by a cadre of anti-China super-hawks who had deliberately kept the American President out of the loop, and Canada succumbed to the bullying of a warrant without even questioning its provenance.

According to John Bolton, Meng was "a spy and a fraudster" (qt in The Two Michaels).  Meng accepted a deferred prosecution agreement.  There was no question of prison time.  She didn't even pay a fine.  What greater evidence could there be that we never should have arrested her in the first place? Now that the "Deferred Prosecution Agreement" and "The Statement of Facts" are available online we can finally know what crimes she committed and confessed to and for which Canada and Canadians were required to pay such a heavy price.

In her presentation, Ms. Meng stated, among other things, that Huawei’s relationship with Skycom was “normal business cooperation” and “normal and controllable business cooperation,” and she described Skycom as a “partner,” a “business partner of Huawei,” and a “third party Huawei works with” in Iran.

Ms. Meng stated that Huawei “was once a shareholder of Skycom” but had “sold all its shares in Skycom.”

Ms. Meng stated that Huawei “operates in Iran in strict compliance with applicable laws, regulations and sanctions” and that “there has been no violation of export control regulations” by “Huawei or any third party Huawei works with.”  

According to the "Statement of Facts," each of these quotations above was a half-truth, evasion, trick, or outright lie.  Did these eight quoted sentence fragments fool HSBC, which had already been informed via Reuters that Huawei through Skycom was doing business in Iran?  How did these eight sentence fragments constitute a crime which justice-seeking Canada would sacrifice its interests and citizens to see prosecuted?  To understand Meng's "crime," it is necessary to understand the USA's "weaponizing of the dollar."

"Weaponizing the dollar"

Meng's lawyer attempted to argue that a conversation in 2013 involving a relatively small series of transactions ("US$2 million over thirteen months") between a Chinese business person (Meng) and a banker (from HSBC) which took place in China should not be considered a crime in US jurisdiction.  Blanchfield & Osler Hampson make vague reference to "a practice known as 'dollar clearing'” to explain the debate.

A number of banks, all over the world, are licensed as "clearing houses," which means they can process extremely large transactions between corporations and countries. The issue is perhaps better understood in terms of the recently much-discussed notion of the USA's "weaponizing of the dollar." As Satyajit Das explains in Business Standard:

[. . . ] the US exerts unprecedented control over global economic activity.

Sanctions target persons, entities, organizations, a regime or an entire country. Secondary curbs restrict foreign corporations, financial institutions and individuals from doing business with sanctioned entities. Any dollar payment flowing through a US bank or the American payments system provides the necessary nexus for the US to prosecute the offender or act against its American assets.

The USA has been using its incredible privilege of printing/digitalizing the global reserve currency and consequent control over the finances of the global economy to punish Iran.  As we have seen in the Meng case, anyone who asks a bank to transgress a regulation put in place by the USA risks criminal prosecution for bank fraud.  No-one can stop China or Europe from doing business in Iran, but the USA can prosecute the use of a US-licenced financial institution for transgressing US regulations. 

"Weaponizing of the dollar" is a hotly debated topic, and now we Canadians know what it feels like to be enforcers in a system most of us didn't even know existed.

What the Globe and Mail Won't Publish

Sour Grapes 

Over the years, a couple of my readers have suggested I should aspire to a larger audience by publishing in the mainstream media.  Admittedly, I have made a couple of feeble attempts to be noticed, but when I became aware of a feature in the Globe and Mail called "First Person" where individuals are offered the possibility of  publishing in the paper (for zero remuneration), I thought this was my opportunity to either promulgate my blog in a legacy press or create a sour-grapes moment when the editors declined to publish my submission.  "Sour grapes" wins again.  Here is the article:

How I Became Obsessed with Money and China

In retirement from my position as a professor of English, I knew I wouldn’t miss the turgid prose that passed for peer-reviewed research in postmodern humanities or the administrative duties that every alert academic scurries to avoid.  Contact with students and the vain apprehension that some young people were actually interested in what I had to say: these were hard to give up.  My solution was to maintain at least the illusion of teaching by starting a blog.  A few clicks on Google Blogger, a bit of word processing, a pseudonym, and voilá: I was a blogger.  When I got really serious, for an annual payment of $17.00, I became the owner of the domain name thesourgrapevine.com.

My original intention was to host a whistle-blower site to reveal what went on behind closed doors at universities, but I soon digressed into politics and economics.  I covered my digressions with the by-line “Education is everything.  Everything is education.”

How did I become obsessed with money and China?  The answer begins with the philosopher Karl Jasper’s claim that “failure and breakdown reveal the true nature of things.”  Leonard Cohen put it more poetically:  “There’s a crack in everything; that’s how the light gets in.” A more homespun version: we should celebrate the child who breaks her toys.  She’s figuring out how they work.

The breakdown which provoked my money obsession was the collapse of the financial markets in 2008.  Wall Street’s massive failure led me to seriously question, for the first time in my life, how the economy worked, how finance and monetary policy worked. Ultimately, I drilled down to the bedrock, Ding an sich/thing-in-itself of it all:  money.  How is it created and distributed?  How do banks lend money that they don’t have? Is money really just imaginary?  Is it really just a yardstick whose only purpose is to measure debt? As I recorded the pursuit of these questions in my blog, I realized that the generator of my writing had become the overarching question:  how could I not know this?  My research into the existential and ontological question of money told me I wasn’t the only one who didn’t quite understand what it was.

         

In everything I read, from conspiracy theories to government websites to Jacob Goldstein’s Money: The True Story of a Made-up Thing to Mark Carney’s Value(s): Building a Better World for All, I found the reiterated, mind-boggling fact that most of the money in the world is created out of nothing by private banks.  How is this possible?  How could I not know this?  Isn’t this something every ten-year-old should know?  I felt both sheepish and vindicated to discover a lesson on the Khan Academy homework website demonstrating the mathematical formula for how every $1000 introduced into the system by the Federal Reserve allows private banks, using the fractional reserve system, to create $10,000.  How money is created might be a mystery to Boomers, but the next generation of ten-year-olds will know the facts by heart and in detail.

Learning about money, I also discovered something about the nature of obsession—or maybe it’s just me.  I have a significant cohort of friends who are accountants, bankers, and financial advisors—men I consider to be experts on money.  Whenever I presented my newfound discovery that private banks created money, there was general staring off into the middle distance and rolling of eyes.  I pressed on with multiple blog posts and email messages. Other than silence, the responses were obfuscations, sarcasm, denials, jokes, and a stalwart defense of the banking system.  If someone had simply told me, “Yes, it is a well-known fact that banks create most of the money in the system,” my obsession might have been tempered.  But no one ever did.

The breakdown at the core of my second obsession occurred on December 1, 2018, when Canada arrested Meng Wanzhou, CFO of Huawei on a warrant from  Richard Donoghue, the former chief litigator of CA Technologies, who had recently become a US Attorney for the Eastern District of New York.  I accepted as irrefutable fact the claims of Canadian politicians that extradition was a “judicial process” immune from political interference.  As a researcher trained in the concept of “best evidence,” meaning you don’t quote a second-hand source if the original document is available, I went looking for the Canadian Extradition Act which, as it happens, is available online.  What I discovered was a lie.

The lie I discovered was significant, of dire consequence for some Canadians.  But it wasn’t a good lie.  It wasn’t an ambiguous, complicated, shades-of-grey kind of lie.  It was an obvious, explicit, easy to uncover, baldfaced lie.  The lie is that in Canada, by law, extradition is a judicial, non-political process.  The Canadian Extradition Act is explicit that, at every stage, extradition is a political decision to be made by the Minister of Justice.  

Could I have misinterpreted what I read?  The “Treaty on Extradition Between the Government of Canada and the Government of the United States of America” (available online) does not override the Canadian Extradition Act. Still, interpretation can be a slippery business. I kept searching and eventually discovered “USA v. McVey (1992)” in which the Supreme Court of Canada was required to rule on the question of whether extradition from Canada was a judicial or a political decision.  The Justices agreed that an extradition judge had limited powers to deal with discreet points of law, but extradition from Canada was, by statute, assigned to the executive branch of government—meaning it had to be decided by a politician, the Minister of Justice.

How could Canadian politicians repeat, unchallenged, that there can be no political interference in an extradition case when the law clearly says the opposite?  Rather than questioning, Canadian journalists bragged about how we are “law abiding” while carefully avoiding any citation of the law by which we were supposedly abiding.  

Since our arrest of Meng and China’s retaliatory arrest of the two Michaels, we have been repeatedly warned that China is a malign threat to all that we hold dear.  Knowing that it was possible for Canada to ignore its own laws and keep the lie of “judicial, non-political” extradition afloat for three years, how do I judge the veracity of media claims about China?

              

My obsessions have recently coalesced.  In Has China Won?, Kishore Mahbubani notes that the US dollar is a “fiat currency” (meaning there is no underlying commodity guaranteeing its value) and the “global reserve currency” (meaning countries need US dollars to trade with one another).  Mahbubani argues that being the fiat reserve currency allows the USA to address both trade and fiscal deficits simply by producing more paper/pixel dollars, and it is a mistake to risk this incredible privilege by weaponizing the dollar.  Josh Rogin, on the other hand, in Chaos under Heaven, writes that the USA’s best weapon against China is money, and should be used more ruthlessly.  And so my obsessions continue.

Bernie Madoff as Tragic Hero

A Tragic Hero?

Bernie Madoff died Wednesday, April 14, 2021, while serving a 150-year prison sentence.  It might grate to see Madoff described as a "hero."  In literature, a tragedy is a situation, a plot structure.  A "tragic hero" is the character at the center of that situation.  Imagining Madoff as a monster may be more comfortable, but that image prevents us from learning whatever there is to learn from his story.

The Death of Tragedy

The history and concept of tragedy is one subject where I can actually claim some expertise.  For almost three thousand years, every major philosopher and most major and minor literary theorist had something to say about tragedy.  It all came to a stop in the postmodern period.   As Terry Eagleton observes in Sweet Violence: The Idea of the Tragic, “the term [tragedy] hardly scrapes into the postmodern lexicon” (ix).  The discussion may have finally exhausted itself or, as Alvin Kernan suggests, in The Death of Literature, “The definition of a central genre like tragedy has proceeded in so many directions, many of them quirky in the extreme, as in the end to disintegrate, rather than firm up, the term and any experience that might possibly lie behind it" (42).  Ultimately, my claim of expertise is a bit like saying I'm in the top one hundred of a sport that nobody plays anymore.

The History of Tragedy

That said, here's the two-paragraph description of the 3000-year history of tragedy. The word "tragedy" comes from Greek and would roughly translate as "goat song."  Why a goat?  Tragedies were performed as part of an annual competition and the prize was a goat.  Also, these performances were part of the annual Dionysian harvest festival.  Dionysus was the god of wine and madness and tragedy.  (If you're getting bored:  Dionysus is Baccus in Latin, as in Bacchanalian orgy, so you can substitute sex, drugs and rock 'n' roll here to get the general idea.) The goat--known for its sexual prowess--was the symbol of Dionysus.

The major Greek tragedies were written in the 5th century BCA.  A hundred years later, Aristotle wrote The Poetics, in part to refute Plato's claim that in the perfect society poetry would be banned but more importantly for the following millennia Aristotle claimed that tragedy was the highest form of literary art.  For the next 2,500 years or so, it was generally accepted that tragedy was the highest form of literature because . . . well, because Aristotle said so.  The only debate was about which of Aristotle's features was the most important and did this play or that play have the necessary features.  Eventually, the word "tragedy" began to be used as an honourific; in other words, it wasn't being used just to describe a category of literature or a thing so much as to connote greatness.  In the Modern Era (the 20th century until the mid-60s), the West was going through an adolescent crisis of self-esteem, and it was commonly claimed that we were no longer capable of producing tragedies.  We lacked the culture, the refinement, the sensibilities, the character and characters, the myths, rituals, gods, and whatever, to create or appreciate tragedies.

The Double-bind Theory of Tragedy

Then I came along with my double-bind theory of tragedy which dozens of people have now read--okay, maybe a dozen if I include myself.  Everyone knows that "tragedy" means something bad and sad happens.  When I studied the dramas that most people readily acknowledge as tragedies I saw a consistent pattern. The pattern I saw closely resembled the "double-bind situations" which Gregory Bateson and  R.D. Laing claimed to be, in 100% of the cases studied, the cause of schizophrenia.  Having noticed this resemblance between the claimed etiology (the causes) of schizophrenia and a similar pattern of double-bind, no-win situations in tragedy, I also noted that tragedies led to actions which were not only bad and sad but mad. The hero's fate was inevitably stereotypical insanity, alienation, self harm or suicide.

The Double-bind Etiology of Schizophrenia

The ''double bind" as described by Bateson and Laing is one in which the individual faces contradictory injunctions but cannot escape the situation.  Laing explains that the bombardment of the individual with contradictory demands that s/he must do something and must not do that same thing, most often imposed by the closest of family members, leads to "ontological insecurity" and mental breakdown.

This image is typically presented as a lighthearted version of a double bind:

Imagine that at every important twist and turn, every love-hate, life-or-death dilemma in your life you faced this kind of unsolvable double bind.  R.D. Laing surmises it would drive you crazy. We can all intuit as much.  The authors of tragedies throughout history have intuited as much.

The Orestia by Aeschylus

The Orestia by Aeschylus, the only extant complete ancient Greek tragic trilogy, establishes the pattern.  Orestes, the son of King Agamemnon, is bound by prevailing notions of justice and his role as a prince to avenge his father's murder.  Orestes is further compelled by his self-identity as a moral agent under the scrutiny of the gods and the world to do what is right:  avenge the assassination of the King, his father.  However, justice requires that he kill his mother, Queen Aegisthus, who is responsible for the murder of her husband, King Agamemnon. We can boil down Orestes's double bind to something like:  in order to maintain his understanding of himself, justice and the world, Orestes's must kill his mother.  But in killing his mother, Orestes will abandon his understanding of himself, the world and justice.  To be Orestes, he must kill his own mother; killing his mother, he will no longer be Orestes.  

The Madness of Hamlet and Orestes

Two thousand years later, Shakespeare adopted a similar plot in his version of Hamlet.  Hamlet slowly descends into madness as he attempts to come to terms with the fact that his mother, Gertrude, and his uncle, Claudius, are responsible for the murder of his father, King Hamlet. When Orestes kills his mother, he is immediately possessed by the Furies--possession by the gods being the stereotypical understanding of madness at the time.

An Identity requires a view of the world, a sense of reality

The destruction of the tragic hero implies more than the death and/or madness of an individual.  The hero's identity is part of an ecosystem.  Individual identity is fed and sustained by a larger worldview, an understanding of the world which in its imagined, narrative form we call a myth. The collapse of the individual into madness is, by definition, the collapse, overwhelming and negation of a sense of reality--the sense of reality though which an individual identifies and defines her/himself.  Faced with a double bind which is a product of identity and a corresponding sense of reality, which must be resolved and cannot be resolved, the individual descends into "ontological insecurity." Self and reality cease to exist.

Bernie Madoff's world and identity

The fact that, more than an individual identity, a sense of reality or worldview or, in a more succinct shorthand, a myth is brought into question and negated by the double bind is exactly what makes tragedy modern.  It is also what makes this discussion of Bernie Madoff's life story relevant.

Tragedy penetrates myth, questions and negates reality

In The Origin and Early Development of Greek Tragedy, Gerald Else describes tragedy as "a new penetration of myths from within" (38). Tragedy allowed a questioning of the gods by an individual from "personal experience and hard personal meditation, without benefit of revelation or cult" (37). Additionally, as Karl Jaspers observes, in Tragedy Is Not Enough, "breakdown and failure reveal the true nature of things" (43).  Carrying these observations to the case of Bernie Madoff, we recognize that Madoff's fall and the collapse of his 64-billion-dollar Ponzi scheme coincided with the collapse of the financial markets in 2008.  The tragedy of Bernie Madoff, King of Wall Street, was a penetration, from the inside, of the myth of capitalism.

It is commonly claimed that no American was ever charged with a crime because of the collapse of the markets in 2008. In fact, Madoff was the icon, both the villain and the victim, of 2008. His Ponzi scheme was different in degree but not kind from the sub-prime-mortgage chicanery which brought down the markets. Bernie Madoff wasn't caught by the authorities; he confessed and turned himself in when he realized that the Wall Street collapse would also collapse his Ponzi scheme

The Wizard of Lies

Diana Henriques' The Wizard of Lies supplies the details which allow us to see the tragic double-bind pattern of Bernie Madoff's life.  We can see hints of a "Romeo and Juliet" story in the fact that Ruth Madoff was thirteen when she first met her future husband.  She was eighteen when the Madoffs married on November 25, 1959.  Days later Bernie filed the papers to create Bernard L. Madoff Investment Securities.  He was twenty-one. 

Henriques observes that Ruth's family, the Alperns, were significantly higher on the socio-economic ladder than the Madoffs. We might imagine a "Great Gatsby" scenario with Ruth playing Gatsby's "Daisy" and the object of his Macbeth-like ambitions. By 1962, as Henriques reports, Bernie was already operating illegally as an unlicensed stock broker for clients of his father-in-law's accounting firm and covering up "huge losses he inflicted on his clients when he improperly invested their savings in high-risk newly issued stocks."  Madoff's fraudulent reporting of profits actually enhanced his reputation on Wall Street leading to more people investing in his firm.  After the crash of 1987, Madoff began to pay off his clients with cash from new investors, and his Ponzi/pyramid scheme had begun in earnest.  Madoff claimed to be aware in 1998 that his scheme was destined to collapse and his crimes uncovered.  Why he didn't run? Why didn't he escape somewhere with his ill-gotten millions? Henriques quotes Madoff that “There was never a thought to run away and hide my money.… It never entered my mind to do that.”

Bernie Madoff's world

We may doubt that Madoff never thought to run away, but the evidence supports his claim:  he didn't run away, and we might surmise that the possibility was beyond his imagining.  In his description of tragedy, Arthur Miller writes:

It is necessary, if one is to reflect reality, not only to depict why a man does what he does, or why he  nearly didn't do it, but why he cannot simply walk away and say to hell with it.  To ask this last question of a play is a cruel thing, for evasion is probably the most developed technique most men have, and in truth there is an extraordinary small number of conflicts which we must, at any cost, live out to their conclusions.  [. . . . ]  I take it that if one could know enough about a human being one could discover some conflict, some value, some challenge, however minor or major, which he cannot find it in himself to walk away from or turn his back on. . . . .   I take it, as well, that the less capable a man is of walking away from the central conflict of the play, the closer he approaches a tragic existence. (Arthur Miller's Collected Plays 8).

There are a number of parallels to note between Bernie Madoff and Willy Loman, the tragic hero of Miller's Death of a Salesman:  a New Yorker, father of two sons who eventually repudiate him, husband of a long-suffering wife, a man with "all the wrong dreams," whose demise was an indictment of the myth of "the American Dream."

The Madness of Bernie Madoff

Bernie Madoff lost everything.  He defrauded friends, family, charities and people around the world, many of whom, through the machinations of their financial advisors and investment banks, were unaware that their money was invested with Bernie Madoff.  Madoff's crimes caused the loss of life-savings, pensions, homes, jobs and lives.  For many, the challenge was to find punishment equal to the scale of Madoff's crimes.  But tragedy isn't about justice.  Strict moral justice is reserved for melodrama.

Madoff lost his wealth (though most of it did not exist), his property, and his reputation.  He became a universally acknowledged icon of evil.  Bernie and Ruth made a suicide pact, taking a deliberate overdose of sleeping pills.  Their attempt failed.  Their older son, Mark, also attempted suicide with pills, then later hung himself in his New York condo while his infant son slept in another room.  Ruth became a social pariah and was unable to attend her son's funeral.  The Madoff's younger son, Andrew, died of cancer.

Novalis:  "Character is fate."

Was there a time when Madoff could have stopped and put an end to his fraud?  Perhaps. But, like Oedipus, the king of another time, Madoff was a victim of his own success.  Arguably, given his character and his world (New York, Wall Street, the financial markets), he was fated to see his tragedy through.  We can calculate Madoff's double bind.  He showed the willingness to fully attest to his own guilt to protect his family.  To confess to his crimes at any point would be to destroy his family.  Continuing his crimes would also eventually destroy his family, leaving, in his own words "a legacy of shame for children and grandchildren."   

Bernie Madoff as scapegoat

Terry Eagleton argues that the scapegoat ritual is the essence of the tragic. I disagree. The purpose of the scapegoat ritual is to load the sins of the community onto a symbolic figure which is destroyed, thereby expiating the community from its guilt. To treat Madoff as an egregious anomaly, a singular deviation, a monstrous incongruity, a scapegoat, is to absolve the financial system, which allowed his fraud to thrive for more than two decades, from any culpability or inquiry. Tragedy is relevant today specifically because it brings into the question exactly those mythologies which we might imagine beyond question. As Henriques observes: 

Madoff’s construction of the biggest Ponzi scheme in history was enabled by the Wall Street he had helped to build. He played a prominent role in shaping the modern market, from computerized NASDAQ trading to the mystique of hedge funds to the proliferation of specious derivatives.

Bernie Madoff as human being

If there is anything to learn from the Madoff case, and I believe there is, we must begin with the premise that he was human and consequently susceptible to a double-bind situation which, in turn, brings his ecosystem into question.  As Henriques concludes:

[. . .] to insist, as so many of his victims have, that Bernie Madoff was not fully human, that he was a beast, a psychopath, is a facile cop-out, one last comforting delusion that will leave us forever vulnerable to the seductive spells that all Ponzi schemers cast. Madoff was not inhumanly monstrous. He was monstrously human. He was greedy for money and praise, arrogantly sure of his own capacity to pull it off, smugly dismissive of skeptics—just like anyone who mortgaged the house to invest in tech stocks [ . . . .]

The Wizard of Lies (film)

In the film version of The Wizard of Lies, Diana Henriques plays herself interviewing Bernie Madoff (played by Robert De Niro). Not surprisingly, the film retreats from the  image of Madoff as a tragic human.  (The movie business in general, like postmodernists, is reluctant to embrace tragedy.) In his final scene in the film, Madoff/De Niro complains of being compared to the serial killer Jeffrey Dahmer and  addresses the rhetorical question to Henriques: "Do you think I am a sociopath?" The question does not appear in the book.  If the intended subtext is that Madoff remains protective of his ego and indifferent to the tragedy he has wrought, then whatever is to be learned from the failure of his existence and the world that nurtured it is lost. The less likely interpretation that Madoff's flat affect was a sign of impending schizophrenia is the one that I would uphold.

Is "Typhoid Mary" Back Among Us?

 Mary Mallon (1869-1938)

Mary Mallon, aka "Typhoid Mary,"  was an Irish-born cook and asymptomatic carrier of the typhoid virus who immigrated to the USA and worked for a number of affluent families in New York.  Wherever Mary worked an outbreak of typhoid fever followed.  She is believed to have contaminated 122 people, five of whom died.  Throughout her life, Mary denied that she was responsible for the contagion.  Her solution was to change employer frequently, eventually changing her name several times.  

Causes of typhoid fever

Typhoid fever is generally associated with drinking water contaminated with feces.   Mary was forcibly quarantined by the New York Health Department for two years and eleven months.  Her feces were repeatedly tested confirming the presence of typhoid.  The removal of her gallbladder would have prevented her from transmitting typhoid, but she refused the operation. She was released from confinement after signing an affidavit promising not to work as a cook and to practice good hygiene.  However, after two years working as a laundress, Mary changed her name and returned to her more lucrative employment as a cook.  Authorities were able to track her by following outbreaks of typhoid fever at various New York hotels and restaurants.  She was quarantined a second time in the Riverside Hospital on North Brother Island until her death, 23 years later, in 1938.

Washing hands in the Bible

Mary didn't believe in washing her hands.  She was a devoutly religious woman.  The Bible offers sacred precedence since it is widely recorded in the New Testament that Jesus and his disciples refused to wash their hands before eating. 

Is "Typhoid Mary" back among us?

Is "Typhoid Mary" back among us?  In a number of odd ways, she obviously is.  Literature about her case frequently suggests that she was treated unfairly.  She was the only individual in the USA ever incarcerated for having typhoid.  The closest legal comparison we have these days is the creation of laws for the criminalization of non-disclosure of AIDS.  In 2019, in Canada, "the House of Commons Standing Committee on Justice and Human Rights released a report on the criminalization of HIV non-disclosure. [. . . .] The committee recommended that a new law be created specifically for the transmission of HIV."

For a significant cohort of Canadians, in the context of the Covid-19 pandemic, refusal to wash hands, social distance, wear a mask and ultimately be vaccinated constitute criminal behaviours, no less so than an AIDS carrier failing to inform a sex partner or Mary Mallon anonymously working as a cook with unwashed hands.

Comparisons of anti-maskers and anti-vaxxers with "Typhoid Mary" and AIDS spreaders might seem hyperbolic to some.  However, given the scale and consequences of the Covid pandemic, the comparison is an understatement.  The consequences of an unprotected, asymptomatic Covid virus carrier moving through the community could very quickly dwarf the 122 diseases and five deaths caused by Mary Mallon or the handful of deaths and diseases caused by a narcissistic AIDS carrier.

Are the vaccinated and unvaccinated equally contagious?

Recently the CDC (Centre for Disease Control) published a report on the spread of Covid among people attending public gatherings in Barnstable County, Massachusetts, from July 3rd to 17th, 2021.  The executive summary of the one-page report states that "Cycle threshold values were similar among specimens from patients who were fully vaccinated and those who were not." This sentence was picked up by the media and widely interpreted as meaning that fully-vaccinated and unvaccinated individuals were equally contagious.  What the body of the report actually says is:

Although the assay used in this investigation was not validated to provide quantitative results, there was no significant difference between the Ct values of samples collected from breakthrough cases and the other cases. This might mean that the viral load of vaccinated and unvaccinated persons infected with SARS-CoV-2 is also similar. However, microbiological studies are required to confirm these findings.

There are so many uncontrolled, unknown variables in these sentences, it is difficult to pin down a conclusive interpretation.  To keep it simple:  In the rare event of a breakthrough case in a vaccinated person, "This might mean that the viral load of vaccinated and unvaccinated persons infected with SARS-VoV-2 is also similar," through the media, became "the viral load was identically in vaccinated and unvaccinated people, therefore they are equally contagious."  And the Centre tasked with "controlling disease" unwittingly became a source for those refusing to be vaccinated.  

Ethics and values

In May 2019, I wrote, in Ethics by Numbers, that the "ethical dilemma" wasn't here yet, but it was before us.  The moment of the dilemma is now. We now have a solution to the pandemic:  vaccines.  How do we deal with individuals who refuse to be vaccinated?  Is the ethical choice egoism and what Ayn Rand called The Virtue of Selfishness, with individuals deciding for themselves what they consider best for themselves as individuals?  Or is it time to say that what is ethical is what is best for everyone, or at least for the greatest number?

In a New York Times editorial, "If You Skip the Vaccine, It Is My 'Damn Business'," Jamelle Bouie eventually comes to consider "the larger cultural and political context of the United States."  Bouie concludes:

When you structure a society so that every person must be an island, you cannot then blame people when inevitably they act as if they are. If we want a country that takes solidarity seriously, we will actually have to build one.

The contrast with American radical individualism is the draconian utilitarianism of communist China.  The world looked on in horror as images circulated of Chinese authorities in Wuhan welding shut the doors of people with Covid-19 in order to curtail the spread of the disease.  

Can the ethical dilemma be resolved?

This is the dilemma.  Do we embrace ethical egoism and American radical individualism, sacrificing the lives of millions, in the name of liberty, freedom, personal privacy and rights?  Or do we sacrifice individual liberty and human rights, in the name of saving lives and putting an end to a global pandemic?  This contrast does not offer a better, more moral choice, just a potentially lesser evil.  

Of course, the dilemma would disappear if we could depend on enlightened individuals to do what is right for themselves and everyone around them: masking, isolation and vaccination.  Yet, even as the pandemic has taken more than four million lives, individuals, through dissembling and denial, refuse vaccination, choosing to make themselves crucibles of the virus, allowing it to thrive and mutate, becoming more deadly and contagious for the rest of us.

Perhaps the citizens of New Hampshire offer guidance.  The state motto is "Live Free or Die."  So far, sixty percent of New Hampshire residents have been fully vaccinated.  Staying alive is a sane and healthy prerequisite of living free.

 

Virtues, Vices, and Values

A Charter of Values?

 In 2013, when the Parti Québécois government was proposing a “Charte des valeurs”  I reacted, on this blog, with "outrage, shame, embarrassment, anger, frustration, fear."  Admittedly, by the time the  Coalition Avenir Québec introduced its  "Bill 21: An Act respecting the laicity of the State," a watered-down version of similar legislation, my reactions had mellowed.  (See The "We" Vote in Quebec.) Nonetheless, I remain distinctly uncomfortable whenever I hear a politician invoking "values" and, still worse, "our shared values."  We might expect the expression "our shared values" to be followed by a list of said values but it almost never is.  Upon hearing "our shared values," the white supremacist and the advocate of Black Lives Matter might both breathe a sigh of relief thinking "finally, one of us"--which explains politicians' love of this empty expression.

The Common Objects of a People's Love

In his inauguration speech, Joe Biden offered this list: "Opportunity. Security. Liberty. Dignity. Respect. Honor. And, yes, the truth."  But he didn't call them values.  Citing Saint Augustine, he referred to them as "the common objects" which define a multitude as a people, and this particular list as what defines Americans.  However, as some critics have pointed out, what Augustine was suggesting wasn't necessarily values or virtues.  

“If one should say, 'a people is the association of a multitude of rational beings united by a common agreement on the objects of their love,’ then it follows that to observe the character of a people we must examine the objects of its love.” — St. Augustine, City of God 19.24

The objects of a people's love could equally well be venal, could be vices.  The USA may be the "land of opportunity," whose "military-industrial complex" ensures its security, and whose constitution guarantees its citizens the liberty to have guns but not necessarily abortions or to use the girls' washroom if your birth certificate says you're a boy, but I've never thought of dignity, respect, honor (except for the spelling) and truth as being distinctly American. 

Deadly Sins and Heavenly Virtues

The more I have reflected on this topic, the less certain I've felt about what counts as a value.  In the Judeo-Christian tradition, the vices or "deadly sins" are clear:  pride, greed, wrath, envy, lust, gluttony and sloth.  The "heavenly virtues"--prudence, justice, temperance, courage, faith, hope, and charity--are more ambiguous. We might like to imagine that virtues and vices are absolutes, but it seems obvious that the difference between them is one of degree.  Moderate degrees of the vices seem desirable, while exaggerations of the virtues are equally undesirable.

Values and Valour

Invariably, we imagine our values are virtues and, conversely, we are likely to imagine that other people's values seem like vices.  In truth, few of us ever have to discover what our values truly are or if we have any.  The word "values" shares its underlying root with "valour"; that is, not just worth but strength and courage.  Our values are the principles that we have the strength and courage to maintain under stress and to act upon.  Still, even the most valourous among us can find themselves in a conflict of values, a no-win, double-bind situation which is the defining characteristic of tragedy.  (See The Double-bind Theory of Tragedy and Madness.)

Obedience to Authority:  Virtue or Vice?

Anomie, the absence of values, has long been the claimed condition of privileged, modern societies.  I am mindful of social psychologist Stanley Milgram's infamous Yale "Obedience to Authority" experiments which revealed that 65% of the test subjects would torture a victim to death using electric shock simply because someone who appeared to be in authority told them to.  Obedience is, of course, the most taught and enforced value in education.

What Are Your Values?

The webpage What Are Your Values? provides a list of 150 potential values, including obedience.  Looking at this list and every other list I have considered, I come away wondering:  are these really values?  The webpage offers a soft definition of values as "the things you believe are important." Sex and money don't make anyone's list of values, but I've met a few people who seem to think they are important.

The Central Bank:  God or the Devil?

I was drawn to Mark Carney's Value(s), in the first place, because of the title and because he was Governor of the Bank of Canada and Governor of the Bank of England.  To conspiracy theorists like my friend Henry Makow and members of the Zeitgeist Movement (not to mention bitcoin fans and fanatics), central banks are the spawns of Satan.  Against this foil, it was striking to read Carney's passionate prescriptions and earnest defense of central banks and a "sound dollar."  His sententious, Polyanna proposals for a better world are occasionally ponderous and left me wondering: would fat cats on Wall Street and in the Federal Reserve give two seconds of consideration to what he is recommending?

What's Good for General Bullmoose . . .

In Values, Carney comes across as a nice guy determined to be nice to everyone, even  Jamie Dimon, CEO of JP Morgan Chase and a member of the New York Federal Reserve Board.  However, in Plutocrats, Chrystia Freeland reports on the animosity between Carney and Dimon which exploded at a meeting of the IMF and the World Bank in Washington in 2011.  Freeland points out:

The battle between Carney and Dimon gets at a bigger and more contentious issue [than taxes and profits]:  Are the interests of the state and its big businesses synonymous?  If not, who decides? And if they do clash, does the state have the right--and the might--to curb specific businesses for the collective good?

As Freeland records, Dimon widely promulgated his position that the kinds of global banking regulations Carney was proposing were "anti-American." The Carney speeches Freeland quotes show that the genesis of Value(s):  Building a Better World for All is at least a decade old.  Carney himself traces its origins to his childhood in Canada.

Can values drive value?

Carney argues that:

Values and value are related but distinct. In the most general terms, values represent the principles or standards of behaviour; they are judgements of what is important in life. Examples include integrity, fairness, kindness, excellence, sustainability, passion and reason. Value is the regard that something is held to deserve – the importance, worth or usefulness of something. Both value and values are judgements. And therein lies the rub.

"Therein lies the rub" indeed.  Can we separate values and value, the dancer and the dance?  Or, on the other hand, are they in complete contradiction to one another?  Witness the paradox of The Antiques Roadshow.  An expert explains the values embued in an artifact, but the climax of every episode is the revelation of the dollar value of the object, which is based on the current market and only a tertiary result of beauty or craftsmanship, history or sentiment.

The fiat global reserve currency:  where's the trust, integrity and transparency?

Carney claims that the value of "fiat money is grounded in the values of trust, integrity and transparency." The US greenback, the fiat (non-gold/commodity-based) money that really counts because it is the "global reserve currency" and about which Carney has remarkably little to say, as we have seen, is backed by the threat of military intervention.  (See Petrodollar Warfare.)  Moreover, in recent years, as Kishore Mahbubani (Has China Won?) decries and Josh Rogin  (Chaos under Heaven) lauds, the US has been weaponizing the dollar. (See Analysing the Discourse on the USA-China Cold War.)  The US Federal Reserve was born in secrecy and, to this day, most people don't realize, as Carney confirms, that 80% of the money in the world is created by private banks.  (See The Truth About Money.)

How Many "values" are there?

Carney's orbit of values expands centrifugally to include, in his final chapters: "solidarity – fairness – responsibility – resilience – sustainability – dynamism, and – humility." Once again, I find myself questioning which, if any, of these stand as values.  Values are the principles we are prepared to uphold in the most challenging of times.  Logically, values spring from ethics.  The word "ethics" comes from "ethos," behaviour over time, often translated as "character," and contrasts with "pathos," the emotions of the moment.  In the end, I conclude "values" is a misnomer.  There is only one value: justice.  Those things we call "values" are details:  customs, habits, rituals, and allegories.  Justice must be based on ethics, and Kant's much-maligned "categorical imperative"--laws are moral if you accept them being applied to you--imperfect as it is, is as good an option as we have available to us.

Traditional Distinctions: Comedy versus Tragedy

 Traditional Distinctions: Comedy versus Tragedy

elements	tragedy	comedy
reader response	strong emotions: pity and fear	lighthearted: laughter
reader distance	attraction aversion: close enough to feel pity but wanting to escape from fear, terror	ironic or comic distance, we cannot be too close or sympathize too much with the "victim" of a comedy
reader focus	on an individual, we are inside the hero's head, emotions, dilemma; often sense the entire play is about this individual	on a collective, on a group of people therefore not a strong concern about a single individual, more on relationships between people than the inner life of a single character
plot	unified,strong sense of coherence and cohesion of events, serious, 24 hours, imitation(mimesis) of reality but with a "beginning, middle and end"; sense of individual quest, typical plot is a character against fate or destiny as determined either by the gods or society, often a double-bind situation where no positive result is possible	incongruity, wit, humour, repetition, exaggeration, error; accidents  surprising, ridiculouos series of events; most typical plot of comedy is a young couple being blocked from each other by someone older
character	hero is a superior character, or what Frye calls high mimetic; important role in society, but also displays personal characteristics like courage, strength, determination, desire for truth, capacities for leadership or self expression	characters tend to be like us or below us, low mimetic or ironic in Frye's terms; inferior characters means that we do not take their destinies or behaviour too seriously
themes and issues	most serious themes and abstract issues: future of the state, death of a king, taboos like incest and patricide/regicide; tied to gods, religion, justice, honour; transcendence and fate, existentialism, the meaning of life and the ultimate truth of our existence	bawdy and body themes; body parts and body functions are at issue, sex and cuckoldry are common themes
language and imagery	language is of the highest level and tone to correspond to the most serious of themes and issue abstract issues: religion, the gods, honour, truth, justice, and seriousness of tone, regicide, incest, matricide, the future of the state	language is expected to be of a lower register and we expect to hear about body parts and body functions therefore vulgar, vernacular, and colloquial
ending	ends in death, disaster, destruction of the central character and others; Frye observes that tragedy ends with the hero separated or alienated from his society--if he survives	a happy ending, or at least one in which people get what they deserve (as in "poetic justice"; Frye observes that in comedy the characters end up being brought closer to and into line with their society.

How Do You Steal an Intellectual Property?

Every Property Has a Price 

Whenever I think of "a property," I imagine a couple of wooded acres by a lake.  By definition, an "intellectual property" is a creation of the human mind.  Can a thought be a property?  According to Mark Carney in his tome, Values: "The value of intangible capital (like software and intellectual property) now dwarfs that of physical capital (like factories and real property)."  Value, as Carney reports disapprovingly,  in our capitalist, market-driven society comes down to price which, in turn, means money.

Dead Celebrities

Michael Jackson's net worth has increased dramatically since his death nine years ago.  Managing the finances of dead celebrities is a very lucrative business.  We might like to imagine when we hear the expression "intellectual property" that the artist, inventor or scientist is being protected and getting the full financial reward of her brilliant idea, but history shows this is seldom the case.  Michael Jackson may have enjoyed abundant financial reward for his work but, even in his case, when we look at whose brain created the "intellectual property" and whose bank account ended up with most of the money, they are rarely the same person.

Injustice or Asymmetry?

We might imagine that this financial "injustice" (more an incongruity or asymmetry, actually) is a modern malaise but it runs throughout history.  "Render unto Caesar what is Ceasar's, and unto God what is God's."  The people who make money are the people in the money-making business.  (See The Truth About Money.) The principle is as old as recorded human history, though it may have become exaggerated in recent times.

Shakespeare Never Gave up his Day Job

You might think that Shakespeare got rich from writing plays, but he made his money by being a stage manager, a part-time actor, a co-owner of the Globe Theatre, a share-holder in the theatre company, and from some shrewd real-estate investments.  (Shakespeare never gave up his "day jobs.")   John Heminges and Henry Condell made money on Shakespeare's plays by publishing the folio edition of the collected works, seven years after Shakespeare's death.  (That publication is why Shakespeare is so widely known and studied today.)

How Newton Made Money

The history of science, physics and mathematics was forever changed by the Philosophiæ Naturalis Principia Mathematica, but Isaac Newton had been unable to have his manuscript published.  Edmund Hailey paid for the publication out of his own pocket and was never financially reimbursed.  The Royal Society, responsible for scientific publications, compensated Hailey with unsold copies of their recently published Encyclopedia of Fish.  Of course, Newton eventually made money.  He wasted a lot of time as an alchemist trying to turn lead into gold, then he became Master of the Royal Mint.  (There's a pun in there somewhere.)  His financial gain did not approach a nano of the value of his "intellectual property."

Insulin Then and Now

The Canadian doctor Frederick Banting and his colleagues sold the patent for insulin for $1.  In the USA today, a single vial of insulin costs between $175 and $300.  Research any major medical breakthrough you can think of; invariably, someone discovered something, and someone else made a lot of money from the discovery.  Some people are good at making things and some people are good at making money.  

Exceptions Which Prove the Rule

We are all aware of the apparent exceptions to the rule:  Bill Gates, Steve Jobs, and Elon Musk.  In Isaacson's biography of Steve Jobs, Jobs is quoted describing Gates, disparagingly, as "a businessman."  In my reading of the same biography, I came away with the impression that Steve Wozniak was the creator of the "intellectual property" that became Apple.  Elon Musk may be the only true exception to prove the rule.  I wonder if it's prophetic that he named his company after Nikola Tesla the brilliant inventor who died in poverty.

Romantic Clichés

The romantic cliché of writers and painters living in poverty is so well established that we tend to view affluent artists with suspicion.  The general rule is that artists are either born with money, marry money, live in constant financial distress, or a roller-coaster combination of the three.  Even though what they produce might end up being worth millions.

Robber Barons or Patrons

When we talk about the theft of intellectual property, what exactly are we talking about?  My cynical self says we are talking about stealing money from the people who make money from somebody else's intellectual property, like robbing thieves.   This attitude is completely wrong.  Artists need patrons, supporters, gallerists, publicists, and publishers--someone who believes in their work.  Picasso had Gertrude Stein, van Gogh had his brother Theo, James Joyce had Harriet Shaw Weaver, Tom Wolfe had Maxwell Perkins.  Only the lucky few profit financially in their lifetimes.

Inventorship Versus Ownership

The point is a simple one and well established in copyright law:  inventorship (or authorship) isn't ownership.  Owners make money if there is money to be made.  Consider yourself lucky if someone thinks your "intellectual property" is worth owning.   You are among the very rare few if you are the author and the owner and manage to make money. 

Intellectual Property:  An Ostensive Definition

The Stanford Encyclopedia of Philosophy breaks down "intellectual property" into copyrights, patents, trade secrets, and trademarks.  The Encyclopedia solves the problem of stealing a thought by pointing out that "Typically, rights do not surround the abstract non-physical entity; rather, intellectual property rights surround the control of physical manifestations or expressions of ideas."

Furthermore:

[ . . .] rights only extend over the actual concrete expression and the derivatives of the expression—not to the abstract ideas themselves. For example, Einstein’s Theory of Relativity, as expressed in various articles and publications, is not protected under copyright law. Someone else may read these publications and express the theory in her own words and even receive a copyright for her particular expression. 

Copyright is probably the most familiar form of "intellectual property" and plagiarism is the commonly understood theft of a copyright. The "intellectual property" I am most familiar with--the 20-page, peer-reviewed article in an academic journal--tends to get lost in a grey, copyright wasteland. Researching online I once discovered work I had published advertised (falsely, I'm afraid) as "a top article in the field," then realized I would have to pay a subscription fee to a database company to access my own work. I, like most academics I imagine, don't give much thought to monetizing publications. Aside from tenure and promotion, the reward is just being read and the vague feeling of promulgating knowledge. Teachers, in general, freely share their "intellectual property" every working day of their careers.

Copyright and Plagiarism

Plagiarism in the arts and academia is a very challenging accusation to prove.  (Forgery is, of course, a very different crime.) Early in his career, Shakespeare was accused of plagiarism.  Some readers might be surprised to realize that virtually every play Shakespeare wrote was adapted from an earlier story.  "Romeo and Juliet"  had been published twice before Shakespeare wrote his play version.  (See Why Did Shakespeare Make Juliet Thirteen Years Old?)  T.S. Eliot was particularly critical of Shakespeare's Hamlet, in part, because there had been two earlier Hamlets before Shakespeare wrote his.  (See Holding a Mirror up to Hamlet.)  After 350 years, the controversy continues over who first invented that form of mathematics called calculus--Newton or Liebnitz.

Chinese Theft or American Efficiency

These days, when we hear of the "theft of intellectual property," it is most often Western media reporting on China.  The expression "efficiency infringement" is currently being used to describe large American companies overstepping someone's patent.  Of 143 recent press releases on the FBI website related to "Intellectual Property Theft" about 30 mention China or Chinese nationals.

Trade Secrets

"Trade secrets" are the broadest and least clearly defined category of intellectual property.  They can include computer code, lab results, or a company's negotiating strategy.  Despite being "secret," they come with some of the biggest price tags and consequences.  "Chinese National Sentenced for Stealing Trade Secrets Worth $1 Billion" is a typical headline from the FBI website:  "A former associate scientist was sentenced to 24 months in federal prison in federal court today for stealing proprietary information worth more than $1 billion from his employer, a U.S. petroleum company."

The details of the case seem oddly mundane:

According to the plea agreement, [Hongjin] Tan used a thumb drive to copy hundreds of files containing the proprietary information on Dec. 11, 2018. He subsequently turned in his resignation and was escorted from the premises on Dec. 12, 2018. Later that day, he returned the thumb drive, claiming that he had forgotten to do so before leaving his employer’s property. Upon examination, it was discovered that there was unallocated space on the thumb drive, indicating five documents had previously been deleted. Investigators with the FBI searched Tan’s premises and found an external hard drive. They discovered that the same five missing files from the thumb drive had been downloaded to the hard drive. Tan maintained the files on a hard drive so he could access the data at a later date. Further accessing the material would have been financially advantageous for Tan but caused significant financial damage to his Oklahoma employer.

It whets my curiosity to know how five Oklahoma oil company computer files could be worth a billion dollars.

The Echelon Affair

A historical review entitled The ECHELON Affair conducted by the European Parliamentary Research Service quotes the Smid Report that 

a global system for intercepting communications, probably known as Echelon, indeed existed and was managed on the basis of a secret agreement (the UKUSA agreement) between five countries, the USA (as lead partner), the UK, Canada, Australia and New Zealand.

According to The ECHELON Affair, based on the Smid Report:

The countries most advanced in industrial espionage were using it [industrial espionage] for purposes of tailoring their economic or industrial policies or for gathering information useful to national companies trading abroad. The least advanced countries were concerned with acquiring know-how on the cheap.

The report quotes former CIA Director William Webster:

"Our political and military allies are also our economic rivals and the ability of an economic rival to create, win or control markets in the future has security implications for the United States."

In an Ideal World . . .

According to the World Intellectual Property Indicators 2018, in both 2016 and 2017, China filed more than twice as many patents as the USA.  It is odd that the country which has filed the most patents globally is also the country accused of being cavalier about the theft of intellectual property.  In Has China Won?, Mahbubani claims that, contrary to Western impressions, provinces, officials, and even individual companies in China operate with long-established habits of independence.  He argues that it has been a mistake for the central government to allow American businesses, which are the greatest supporters of China in the West, to be mistreated by lower levels of government and business.

As we reflect upon "intellectual property theft," it's worth keeping in mind that most of the time we are talking about money.  As long as the USA is the country which prints (or digitalizes) the global reserve currency, Americans don't really need to worry about money.  However, at stake is global hegemony.  We in the West, especially close allies like Canada, quite logically, might be more comfortable with the familiar, democratic, capitalist USA as the global hegemon. Mahbubani repeatedly emphasizes that in the USA-China geopolitical contest, both countries should step back and determine what is in the best interests of their populations.  Money and hegemony aside, collaboration and the sharing of intellectual property would seem to be in the best interest of the people of both countries, not to mention the rest of the world on the sidelines.  Unfortunately, the possibility of cooperation in science, medicine, economics, infrastructure, culture, and technology for mutual, even universal, benefit is retreating further into distant obscurity on a daily basis.