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William Wolfe served in the Trump administration
both as the deputy assistant secretary of defense
and as director of House affairs at the Department of State.
He is also an alumnus of #Heritage #Action,
a sister organization of the Heritage Foundation,
the arch-conservative think tank behind Project 2025,
whose chief architect, Russell Vought, posted on X that he was “proud to work with @William_E_Wolfe on scoping out a sound Christian Nationalism.”
A few months later, the Bucks County Beacon uncovered a lengthy online manifesto on the goals of Christian nationalists.
The document, which listed Wolfe and Joel Webbon as contributing editors
and Oklahoma Sen. #Dusty #Deevers as a co-author,
called for “civil magistrates” to usher in 💥“the establishment of the Ten Commandments as the foundational law of the nation.”
The manifesto doesn’t specify exactly how Christian nationalists should achieve these goals.
As Tabachnick, the extremism researcher, interprets it, the TheoBros are imagining a utopia where “they are going to be free to be entrepreneurs in all different senses,
including the tech world that they’re mixing with so freely.”
The key, she said, is that authoritarianism “is required to have the utopian vision.”
Last year, the extremism watchdog group Right Wing Watch posted a video of Wolfe quoting a scripture passage.
There are times when “even the God of peace proclaims by his providence, ‘to arms!’” he says.
“If we have ever lived in a point of time in American history since then that we could argue that now is a time ‘to arms’ again, I think we are getting close.”
William Wolfe’s Christian nationalism manifesto made the rounds on social media,
but in mainstream conservative outlets,
it was #Stephen #Wolfe
(no relation to William)
who brought TheoBro ideas to the wider world.
In his book, which was praised by editors at the Federalist and the American Conservative,
Wolfe paints America as a “#gynocracy” whose government and culture have been feminized by unhappy women leaders.
(Sound familiar?)
He has stated on X that women should not have the right to vote, and that “interethnic” marriage can be “sinful.”
#Andrew #Isker #Andrew #Torba #Gab #refugees #Paul #Gottfried #Richard #Spencer #William #Wolfe #Big #Eva #Josh #Abbotoy #Claremont #Institute #Project2025 #Heritage #Foundation #Chris #Buskirk #Rockbridge #Network #Leonard #Leo #Peter #Thiel #Vance #Josh #Clemans #Charles #Haywood #warlord #Nate #Fischer #Brian #Sauvé #Mefferd #Joel #Webbon #dominant #man #submissive #woman #Hawley #Johnson #Lee #Vance #Trump #Turning #Point #USA #Tucker #Carlson #flamethrower #Douglas #Wilson #Calvinism #Vance #hypermasculinity #birthrates #ethnonationalism #misogyny #TheoBros #Calvin #Rushdoony #homeschooling #charismatic #New #Apostolic #Reformation #reformed #TheoBros #apostles #prophets #Bible #postmillennialism #Aaron #Renn #Andrew #Isker #Douglas #Wilson #shared #history #patriarchal #Christian #nationalism #young #pastors #Christian #prince #women #flogging #Franco #multiculturalism #Taylor #Swift
One eager customer is 38-year-old TheoBro #Andrew #Isker
—the pastor who interned at Wilson’s church,
studied divinity at New Saint Andrews,
and co-wrote a book on Christian nationalism with #Andrew #Torba,
the openly antisemitic CEO of the social media platform #Gab.
In July, Isker announced on X that he planned to move his family of seven to lead a church in a New Founding community in Tennessee.
Life in his native Minnesota, he said, had become untenable because of permissive laws around trans rights and abortion,
not to mention how hospitable the state has been to #refugees.
“Minnesota is one of the top destinations for resettling foreign people hostile to our way of life,” he said.
That month, Isker spoke at a Texas conference about the
“war on white America”
alongside #Paul #Gottfried,
the mentor of prominent white nationalist #Richard #Spencer.
The conference was hosted by the "True Texas Project",
a far-right group with ties to Sen. Ted Cruz (R-Texas) and Texas Attorney General Ken Paxton.
Like many TheoBros,
Isker sees much to like in Vance.
In early July, before Trump announced his running mate, Isker referred to him as
“Senator JD Vance (R-Heritage America).”
In late July, he posted a video of Vance and told his 29,000 followers,
“You need to double down on childless cat lady discourse.
Kamala sees happy, large families and hates them.
She wants them destroyed.
She wants you to never be able to have this.
She is a nasty, bitter harridan who hates all that is true, good, and beautiful.”
One problem is that there simply are not enough TheoBros to populate Christian communities like the one Isker plans to move to.
Enter #William #Wolfe,
the founder of the
"Center for Baptist Leadership", which aims to persuade members of the Southern Baptist Convention that it,
the largest of all Protestant denominations in the United States,
has fallen prey to the corrupting forces of liberalism.
Baptists are only the beginning.
Wolfe wants to win over the entire evangelical mainstream,
which he and other TheoBros refer to as “#Big #Eva.”
In August, he posted on X,
“Once you realize that Big Eva thinks it’s a bigger sin to desire to preserve the customs, heritage, values, and cultural homogeneity of your own nation
than to kill the unborn in the womb, you can better understand their moral framework.”
#Josh #Abbotoy #Claremont #Institute #Project2025 #Heritage #Foundation #Chris #Buskirk #Rockbridge #Network #Leonard #Leo #Peter #Thiel #Vance #Josh #Clemans #Charles #Haywood #warlord #Nate #Fischer #Brian #Sauvé #Mefferd #Joel #Webbon #dominant #man #submissive #woman #Hawley #Johnson #Lee #Vance #Trump #Turning #Point #USA #Tucker #Carlson #flamethrower #Douglas #Wilson #Calvinism #Vance #hypermasculinity #birthrates #ethnonationalism #misogyny #TheoBros #Calvin #Rushdoony #homeschooling #charismatic #New #Apostolic #Reformation #reformed #TheoBros #apostles #prophets #Bible #postmillennialism #Aaron #Renn #Andrew #Isker #Douglas #Wilson #shared #history #patriarchal #Christian #nationalism #young #pastors #Christian #prince #women #flogging #Franco #multiculturalism #Taylor #Swift
An even more well-connected Wilson emulator is
#Josh #Abbotoy,
executive director of "American Reformer"
and managing partner of a venture capital fund and real estate firm called "New Founding".
A former fellow of the right-wing think tank the #Claremont #Institute, Abbotoy reported that he recently participated in a #Project2025 presidential transition “strategic planning session”
hosted by the right-wing think tank the #Heritage #Foundation.
Bucks County Beacon reporter Jennifer Cohn revealed venture capitalist #Chris #Buskirk was listed as the editor and publisher.
In 2022, Buskirk co-founded the #Rockbridge #Network,
a collection of powerful Trump donors including Catholic judicial kingmaker #Leonard #Leo and Silicon Valley billionaire #Peter #Thiel.
Another co-founder of the Rockbridge Network?
None other than
JD #Vance.
Thiel, Vance’s mentor and former employer, is also a major funder of the National Conservatism movement.
Obsessed with global birthrates, Thiel spent $10 million on his protégé’s successful 2022 Senate campaign.
In July, shortly after Trump had announced Vance as his running mate,
Cohn surfaced a tweet by New Founding’s network director,
#Josh #Clemans:
a photo of Vance with several New Founding staffers.
The caption read “Our guy.”
New Founding lists as a partner the "Society for American Civic Renewal",
a secretive fraternal order founded by Indiana shampoo baron #Charles #Haywood,
who describes himself as an aspiring Christian “#warlord.”
According to founder #Nate #Fischer, New Founding wants to “form the backbone of a renewed American regime”
and that its members
“understand the nature of authority and its legitimate forceful exercise.”
But its main public-facing project appears to be turning tracts of land in Appalachia into Christian communities.
Promotional materials describe a community of
“unmatched seclusion”
where
“simple country faith”
protects local culture from rainbow flags and crime.
Potential buyers, he advises, should not delay.
“Who’s going to grab the land?
Is it going to be good, based people who want to build something inspiring,
something authentic to the region’s history,
or is it going to be Bill Gates and BlackRock and hippies from California?”
#Brian #Sauvé #Mefferd #Joel #Webbon #dominant #man #submissive #woman #Hawley #Johnson #Lee #Vance #Trump #Turning #Point #USA #Tucker #Carlson #flamethrower #Douglas #Wilson #Calvinism #Vance #hypermasculinity #birthrates #ethnonationalism #misogyny #TheoBros #Calvin #Rushdoony #homeschooling #charismatic #New #Apostolic #Reformation #reformed #TheoBros #apostles #prophets #Bible #postmillennialism #Aaron #Renn #Andrew #Isker #Douglas #Wilson #shared #history #patriarchal #Christian #nationalism #young #pastors #Christian #prince #women #flogging #Franco #multiculturalism #Taylor #Swift
In August, Joel Webon remarked on his show that “a lot of people are gonna be surprised” when
“you’re spending eternity worshipping Christ next to Stonewall Jackson and Robert E. Lee and Jonathan Edwards,
and, you know, George Whitefield and Martin Luther King Jr.’s in hell.”
Webbon is so impressed by his own audacity that he maintains an online list of all the controversies in which he’s become embroiled.
There, he explains why he called Christian men living in California “stupid”
(they could just move to a red state);
why he once ordered his wife to stop reading a book on theology
(he didn’t want her exposed to beliefs that were different from his own);
and why he believes in a patriarchal household structure
(the Bible says so).
Webbon, who is planning to host a conference in Texas next spring called
“Christ Is King: How to Defeat Trashworld!”
maintains that a
“return to the Constitution is impossible”
and that the only viable alternative is the Ten Commandments.
Some of Wilson’s other acolytes are attempting to create their own versions of Moscow, Idaho.
Take #Brian #Sauvé, a 33-year-old Christian recording artist, podcaster, and pastor of "Refuge Church" in Ogden, Utah.
Like Webbon, Sauvé wasn’t always reformed
—Refuge began as a charismatic Christian church.
After the lead pastor resigned in a scandal, the then-24-year-old Sauvé ascended to take his place,
immersed himself in reformed theology,
and moved the church in a new direction.
Today, he presides over a Moscow-esque ecosystem:
a publishing house called "New Christendom Press",
as well as "St. Brendan’s Classical Christian Academy",
modeled after those in Wilson’s network.
“Can you feel it in the sails?” reads St. Brendan’s website.
“The stiff breeze out of Moscow, Idaho? -- We can.”
On his three podcasts and to his more than 53,000 followers on X, Sauvé regularly states that women’s primary function is to bear children.
In July, after Vance’s comments about “childless cat ladies who are miserable” began widely circulating,
he posted:
“It is desperately sad to think of all the intentionally barren women who will find themselves totally alone in their 50s,
realizing their irreversible mistake.
They will wish they could trade it all
—money, vacations, independence, all of it
—for children they can now never have.”
But unlike more mainstream conservatives,
Sauvé does not even pretend to champion the idea of a
Judeo-Christian nation.
He posted in July, “[O]ur political system is heavily influenced by Jews who reject Christ and embrace all manner of evils.”
#Mefferd #Joel #Webbon #dominant #man #submissive #woman #Hawley #Johnson #Lee #Vance #Trump #Turning #Point #USA #Tucker #Carlson #flamethrower #Douglas #Wilson #Calvinism #Vance #hypermasculinity #birthrates #ethnonationalism #misogyny #TheoBros #Calvin #Rushdoony #homeschooling #charismatic #New #Apostolic #Reformation #reformed #TheoBros #apostles #prophets #Bible #postmillennialism #Aaron #Renn #Andrew #Isker #Douglas #Wilson #shared #history #patriarchal #Christian #nationalism #young #pastors #Christian #prince #women #flogging #Franco #multiculturalism #Taylor #Swift
In subsequent videos, Douglas Wilson tackled women’s culpability in rape,
the dark side of empathy,
and the virtues of “something called the patriarchy
—that which, according to our
soi-disant and lisping political theorists, must be smashed...
Only they say something like ‘thmasth.’”
Wilson has used his platforms to anoint the next generation of ultraconservative reformed Christian pastors,
all of whom happened to be men.
#Mefferd, the conservative Christian journalist, told me that Wolfe’s "The Case for Christian Nationalism"
got traction in mainstream Christian circles in part
“because Doug Wilson endorsed.”
Another Wilson protégé is #Joel #Webbon, a 38-year-old pastor who hosts a podcast and YouTube show,
which he films from a wingback leather chair in a book-lined room.
Webbon wasn’t always reformed
— he is an alumnus of a Bible school run by a New Apostolic Reformation affiliated outfit,
— which he now considers “straight-up heretical.”
In his 20s, he broke from the group, moved to Texas, and started his own church.
In a video from a few years ago, Webbon credited Wilson with emboldening him to say whatever he wanted
—like telling a guest that the Founding Fathers weren’t responsible for the slave trade because Africans had done the actual kidnapping and enslaving.
For Webbon, it was intensely liberating to watch Wilson speak in public without worrying about being canceled.
“You stay in your little corner, you stay on your little leash, because you’re like, I don’t know what will happen,” Webbon said.
“But when you see some other guy do it, and you’re like
—that’s the worst thing that can happen?
Vice writes an article about you? [Christianity Today editor-in-chief] Russell Moore won’t invite you to his birthday party anymore?
Like, that’s it.”
At a recent conference, he registered dismay over immigrants in his community.
“It’s like full, straight-up Hindu garb at our neighborhood swimming pool,
that my daughter is asking [about and] I’m trying to explain.”
#dominant #man #submissive #woman #Hawley #Johnson #Lee #Vance #Trump #Turning #Point #USA #Tucker #Carlson #flamethrower #Douglas #Wilson #Calvinism #Vance #hypermasculinity #birthrates #ethnonationalism #misogyny #TheoBros #Calvin #Rushdoony #homeschooling #charismatic #New #Apostolic #Reformation #reformed #TheoBros #apostles #prophets #Bible #postmillennialism #Aaron #Renn #Andrew #Isker #Douglas #Wilson #shared #history #patriarchal #Christian #nationalism #young #pastors #Christian #prince #women #flogging #Franco #multiculturalism #Taylor #Swift
Douglas Wilson's influence over Moscow Idaho has not been without controversy.
In a 2021 Vice exposé, former members of "Christ Church" alleged that ministers had encouraged them to stay in abusive relationships.
That tracks with Wilson’s 1999 book, "Fidelity: How to Be a One-Woman Man",
in which he wrote,
“The sexual act cannot be made into an egalitarian pleasuring party.
A man penetrates, conquers, colonizes, plants.
A woman receives, surrenders, accepts.”
For that reason, Wilson wrote, the dynamic of a #dominant #man and a #submissive #woman is
“an erotic necessity.”
(Wilson called allegations of the church urging women to stay in abusive relationships “categorically false.”)
Wilson has also promoted another form of dominance.
In the 1996 book "Southern Slavery: As It Was",
Wilson and his co-author argued that the master-slave dynamic was “a relationship based upon mutual affection and confidence,”
-- and “there has never been a multi-racial society which has existed with such mutual intimacy and harmony in the history of the world” as that of the antebellum South.
(In a 2020 blog post, Wilson said he now allows that while “the benevolent master is not a myth, the idea of the horrific taskmaster is no abolitionist myth either.”)
When I asked Wilson about his controversial statements, he likened himself to a chef who strategically deploys jalapeno peppers:
“Then some of my enemies online have combed through my writings, have gathered up all the jalapenos and put them on one Ritz cracker.”
In July, at the "National Conservatism Conference"
in Washington, DC, Wilson shared the stage with Sens. Josh #Hawley (R-Mo.),
Ron #Johnson (R-Wis.),
and Mike #Lee (R-Utah),
as well as #Vance,
who auditioned his “America is a people” bit a week before his star turn at the GOP convention.
Wilson agrees with Vance’s suggestion that children should be allotted votes
-- managed by their parents.
“I would like to see elections where households vote,” he told me.
Men, as the heads of households, would actually cast the votes.
Though he believes that women’s suffrage was “a mistake,”
he would allow a special exception for single mothers.
Wilson offered the crowd a few one-liners
(“I’m a Presbyterian, not a Lesbyterian”),
but mostly, he talked about the persecution of Christians:
“It used to be that the sexually troubled had to keep their kinks hidden away in the closet,” he mused.
“Now it is the conservative Christian who needs to keep his virtues hidden in the recesses of the closet.”
After the "National Conservatism Conference", Wilson appeared at the "Believers’ Summit",
which was headlined by #Trump and hosted by the conservative political group #Turning #Point #USA.
But it’s not just conferences and interviews with the likes of #Tucker #Carlson where Wilson promotes his ideas.
He has a blog, a podcast, and a YouTube channel, thanks mostly to the urging of his children and younger colleagues.
One example is that every year since 2018, Wilson has been celebrating what he calls
No Quarter November:
“The month where we say out loud what everyone is thinking.”
In a 2023 video, which was the brainchild of one of his sons, Wilson sits at a sumptuously appointed Thanksgiving table,
surrounded by his children and grandchildren,
and addresses the camera.
“If you think of my blog as a shotgun,” he says,
“this is the month when I saw off all my typical, careful qualifications and blast away with a double-barreled shorty.”
His wife, clad in an apron, brings out a turkey and places it in front of him,
and then the tranquil scene is interrupted by a blaring alarm and a glowing red “perimeter breach” sign.
Wilson excuses himself, heads to his garage, and straps on a #flamethrower.
After using it to light a cigar, he aims the fire at cardboard cutouts of Disney princesses Elsa and Ariel, and the logos of Instagram, TikTok, Twitter, and Netflix.
Wilson’s willingness to make campy content sets him apart, says Rachel Tabachnick,
an extremism researcher who has been studying Christian nationalism for decades.
“Instead of a crotchety old guy talking about stoning people, he’s like, super cool,” she says. “He’s witty.”
#Douglas #Wilson #Calvinism #Vance #hypermasculinity #birthrates #ethnonationalism #misogyny #TheoBros #Calvin #Rushdoony #homeschooling #charismatic #New #Apostolic #Reformation #reformed #TheoBros #apostles #prophets #Bible #postmillennialism #Aaron #Renn #Andrew #Isker #Douglas #Wilson #shared #history #patriarchal #Christian #nationalism #young #pastors #Christian #prince #women #flogging #Franco #multiculturalism #Taylor #Swift
Like all self-respecting millennials, the TheoBros have little tolerance for boomers,
with the exception of their patriarch, #Douglas #Wilson,
a 71-year-old pastor in Moscow, Idaho.
When he was younger, Wilson imagined himself going into the family business
—Christian bookstores
—but after a stint in the military, he moved to Moscow in 1975 to study philosophy at the University of Idaho,
where he became involved with the "Jesus People",
a kind of mashup of evangelical and hippie culture.
He helped found "Christ Church",
the congregation over which he still presides and that regularly draws crowds of 1,300.
Wilson has since turned the college town into his own Christian kingdom.
He helped found "New Saint Andrews College",
the "Canon Press" publishing house,
and "Logos School",
one of the nation’s first classical Christian schools,
where students exclusively study the Western canon.
Wilson embraced #Calvinism in 1988 and remade his church from the freewheeling "Jesus People" hub into something far more sober and buttoned-up,
where women couldn’t be church leaders and the only music allowed was hymns and psalms.
In the early 1990s, Wilson helped launch the "Association of Classical Christian Schools", which had 502 member institutions across the United States as of March 2023.
#Vance #hypermasculinity #birthrates #ethnonationalism #misogyny #TheoBros #Calvin #Rushdoony #homeschooling #charismatic #New #Apostolic #Reformation #reformed #TheoBros #apostles #prophets #Bible #postmillennialism #Aaron #Renn #Andrew #Isker #Douglas #Wilson #shared #history #patriarchal #Christian #nationalism #young #pastors #Christian #prince #women #flogging #Franco #multiculturalism #Taylor #Swift
Stephen Wolfe grew up in Napa, California,
and his father was an admirer of the right-wing pundit and erstwhile GOP presidential candidate Pat Buchanan.
After attending West Point and serving in the Army, Wolfe earned advanced degrees before leaving academia to
“do the Wendell Berry thing”
in North Carolina with his wife and four kids.
Over the summer, Wolfe, 41, agreed to speak with me on the condition that I refer to him as “Dr. Wolfe”
and call him an “expert on Christian nationalism.”
The Dr. Wolfe I spoke with was a more muted version of the firebrand I’d watched online.
He said his ideal version of America would be led by a Caesar figure.
Gay marriage would be strictly prohibited.
Women would not be allowed to vote
—instead, men would vote for their households.
When I brought up the bit from his book about heretics being killed, he grew annoyed.
“I do think it’s permissible, in principle, for a state to suppress theological heresy,
but that doesn’t mean that it’s prudent or proper,
suitable in every circumstance or every tradition or way of life.”
The Founding Fathers, he added, had encouraged religious liberty,
so killing heretics would not be appropriate in the United States that we inhabit.
We turned to remarks he had made at a recent conference convened by Brian Sauvé:
“I think we need to reflect on this idea of Judeo-Christianity,
or Judeo-Christian worldview,
or Judeo-Christian whatever,
and really eradicate that from our thinking.
Because if we say that America is a
Judeo-Christian country,
then it can’t be a Christian country, okay?”
What role, I asked him, would Jews play?
After a deep sigh, he told me that they would be allowed to “exercise their religion freely.”
We spoke a week before Vance’s RNC speech,
and Wolfe’s remarks helped me understand what the TheoBros heard in Vance’s phrase about
"America as a people".
The founders, Wolfe noted, intended for their country to be “Anglo-Protestant with an American inflection.”
America, he continued, is “a place of settlement and rootedness,
but it’s an open ethnicity in which people can become one of us.”
Which is to say that, like some others, Wolfe is not necessarily opposed to the idea of nonwhite people in America
—as long as they agree to assimilate to the Anglo-Protestant dominant culture.
In this telling, America is not a pluralistic society at all,
but rather one in which there exists an uneasy truce between Christians and those they reluctantly tolerate.
Toward the end of our conversation, I asked Wolfe what motivated him.
“I want Christians to be more assertive and to recognize the Christian heritage of the American way of life,
and to seek to restore that,” he said.
“This is a Christian country, and we’ve got to work to restore it to what it once was"
In his keynote address at Sauvé’s conference, titled “Why Multicultural Pluralism Fails and What to Build Instead,”
Wolfe called the concept of America as a melting pot
“an early 20th-century idea cooked up by a Jew in New York who despised the confident Anglo-Protestant establishment.”
WASPs were the “distinct ethnicity” of America, he insisted,
and America should only welcome those who aspired to assimilate.
As he put it, “This is our homeland, and we welcome you on the condition of conformity.”
Or, in the words of JD Vance, America “is a group of people.”
motherjones.com/politics/2024/…
#Heritage #Action #Andrew #Isker #Andrew #Torba #Gab #refugees #Paul #Gottfried #Richard #Spencer #William #Wolfe #Big #Eva #Josh #Abbotoy #Claremont #Institute #Project2025 #Heritage #Foundation #Chris #Buskirk #Rockbridge #Network #Leonard #Leo #Peter #Thiel #Vance #Josh #Clemans #Charles #Haywood #warlord #Nate #Fischer #Brian #Sauvé #Mefferd #Joel #Webbon #dominant #man #submissive #woman #Hawley #Johnson #Lee #Vance #Trump #Turning #Point #USA #Tucker #Carlson #flamethrower #Douglas #Wilson #Calvinism #Vance #hypermasculinity #birthrates #ethnonationalism #misogyny #TheoBros #Calvin #Rushdoony #homeschooling #charismatic #New #Apostolic #Reformation #reformed #TheoBros #apostles #prophets #Bible #postmillennialism #Aaron #Renn #Andrew #Isker #Douglas #Wilson #shared #history #patriarchal #Christian #nationalism #young #pastors #Christian #prince #women #flogging #Franco #multiculturalism #Taylor #Swift
To understand JD Vance, you need to meet the “TheoBros”
These extremely online young Christian men want to end the 19th Amendment, restore public flogging, and make America white again.Mother Jones
It’s really striking to compare the two big crises of the last two decades.
The Global Financial Crisis beginning in 2007 was purely a matter of book entries in computers.
No actual physical capital was destroyed, nobody died.
By contrast, the COVID-19 pandemic beginning in 2020 was a massive blow to productive capacity
– millions of people died,
buildings were rendered unusable.
But it was the first of these two crises that led to massive scarring and a prolonged global recession, not the second.
Why?
It might be said that the reason why is that if you consider the world economy as an organism,
the pandemic attacked its muscles and sinews
while the financial crisis attacked its brain.
The global financial services industry is a crucial part of the distributed decision-making system of the world,
and its core component is a very old, but still surprisingly poorly understood technology
called #debt.
In the strictest, purest sense,
debt is an “#information #technology”
– it’s one of the mechanisms human beings have invented to handle information.
By structuring an investment in someone else’s project as a debt,
you immediately reduce the space of possible outcomes to two
– you get paid back, or you don’t.
There are a lot of other information-processing techniques that banks and investors use,
from statistical credit scoring to modern portfolio theory,
but this is the big one.
It allows a modern bank to keep track of vastly more financial investments than would ever have been possible for a medieval merchant in the first days of double-entry book-keeping.
Rather than having to preserve face-to-face relationships with every single borrower,
you can rely on the fact that 99% of mortgage loans get paid back in full and on time,
and concentrate your attention on managing the 1% of cases where something goes wrong.
🔥The trouble is that if you build a business on this basis, what happens when it turns out that there’s a small variance❓
Unfortunately, a small variance in the proportion of good loans from 99% to 97% means a tripling in the number of bad loans❗️
and consequently a huge excess load on the systems that are meant to deal with them.
Faced with this massive cognitive overload,
the system froze.
And even more unfortunately,
in a world in which trillions of dollars need to be rolled over and refinanced every day,
the one thing that the financial sector cannot do is stop for a moment to regain its bearings.
If information processing was free and the bankruptcy process frictionless,
the Global Financial Crisis would have been over in a month.
As it was, all the information which had been attenuated by the use of multiple layers of secured debt came back,
suddenly unattenuated and needing to be dealt with.
That’s the “cybernetic history” of the debt crisis which I outline in my book,
and I think it’s a useful alternative perspective to the economic one,
and one which makes it more comprehensible that a relatively small market for synthetic CDOs turned into a continental crisis.
But this might not even have been the most pernicious use of debt seen in our lifetimes.
(2/3)
profilebooks.com/work/the-unac…
#criminogenic #organisation #Stafford #Beer #Barry #Clemson #accountability #sink #Boeing #737MAX #Boeing #merger #McDonnell #Douglas #engineering #culture #cost #control #Ricardian #Fallacy #hard #data #culture #best #practice
More from Dan Davies:
About five years ago, I started to get very interested in an obscure subject called “#management #cybernetics”.
It was a product of the technological dreamscape of the 1960s and 70s;
after the invention of the computer, but before it became ubiquitous,
in a period when there was room for speculation about how the new world of artificial intelligence would change our world.
I had just finished my previous book
(Lying for Money: How Legendary Frauds Reveal the Workings of the World),
and was keen to say a bit more about how organisations go wrong.
It seemed to me that it might be possible to expand the concept of a “#criminogenic #organisation”
(one where the incentives structurally produce illegal behaviour)
to a more general 🔸“bad-decision-o-genic organisation”.
And furthermore, that the weird mixture of pure mathematics, philosophy, accountancy, physics and economics that came together in the work of now-forgotten management gurus like #Stafford #Beer and #Barry #Clemson might be the way to think about it.
What do bad decision-making organizations have in common❓
Quite a few things,
but one of the clearest signs is something you might call an “#accountability #sink”.
This is something that might be familiar to anyone who has been bumped from an overbooked flight.
There is no point getting angry at the gate attendant;
they are just implementing a corporate policy which they have no power to change.
But nor can you complain to the person who made the decision
– that is also forbidden by the policy.
The airline has created an arrangement whereby the gate attendant speaks to you with the voice of an amorphous algorithm
-- but you have to speak back as if to a human being like yourself.
The communication between the decision-maker and the decided-upon has been broken
– they have created a handy #sink into which #negative #feedback can be poured without any danger of it affecting anything.
⚠️This breaking of the feedback links is, I think, one of the most important things that has happened to large organisations
– banks, but also large corporations and government departments
– over the last fifty years.
In most cases, it’s not been carried out purely as a responsibility-dodging exercise,
or as part of a conscious effort to make things worse.
That has happened, on occasion,
but for the most part, after spending a lot of time looking into examples,
I concluded that feedback links were being broken simply because 💥they had to be.
The world keeps growing and getting more complicated,
which means that individual managers gradually become overwhelmed;
the problem of trying to get a sensible drink from the firehose of information that pours into any large organisation every day has become unbearable.
And this is why institutions have started ❌ delegating decisions to systems
– credit scoring algorithms, regulatory risk weighting formulas
and the like.
As well as allowing decision-making to be automated and industrialised,
they provide a psychological defense system,
👉preventing individual human beings from the consequences of having to make a decision and own it.
Most of the time, these systems work well.
But when they break down, the consequences can be spectacular.
Because every such algorithm or rulebook is, implicitly, based on a #model of the thing they’re meant to govern.
And every such model is capable of failure.
And when something comes along that’s outside the model
– like, for example, a sustained nationwide fall in US house prices
– you end up in a situation where literally nobody knows what to do.
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netinterest.co/p/decisions-nob…
@pluralistic
#Boeing #737MAX #Boeing #merger #McDonnell #Douglas #engineering #culture #cost #control #Ricardian #Fallacy #hard #data #culture #best #practice
Decisions Nobody Made
Dan Davies Introduces His New Book. Plus: Earnings Season!Marc Rubinstein (Net Interest)
Dan Davies:
These thoughts struck me while listening to the ** Odd Lots podcast on Boeing,
which I thoroughly recommend.
The #Boeing #737MAX is one of the core case studies in
"The Unaccountability Machine" (you can buy it now!),
because it’s a really graphic example of 💥a decision-making system which generated an awful result -- ⚠️without any identifiable natural person being responsible for it.
The Odd Lots episode, focuses on #Boeing's 1997 #merger with #McDonnell #Douglas as the inflection point in Boeing’s history.
♦️This caused a thorough cultural change from Boeing’s historical “#engineering #culture” -- based on ❇️getting things right and doing what was needed,
♦️to something more in tune with the Jack Welch / Shareholder Value spirit of the times,
🆘focused on #cost #control and "return on investment".
It's kind of odd, though.
Boeing was the acquirer and the larger company;
McDonnell was actually not in that great shape;
it had a good defence business but a bad civilian aircraft business;
in fact, one of the attractions for Boeing was that McDonnell had spare factory capacity that it could use to accelerate its own overflowing order book.
As you’d expect from a company run along financial lines, it was quite indebted too.
So why was it McDonnell’s culture that became dominant?❓
⬇️ Let’s take a step back into economics.
Joseph Schumpeter identified something he called “The #Ricardian #Fallacy”.
This is the tendency of economists to 🔹build a theoretical model,
🔹solve the model
and then 🔸act as if they have solved the problem in the real world.
To an extent, this isn’t particular to economists
– it’s the nature of modelling that having made a representation of reality specifically in order to attenuate its complexity and make a problem manageable,
--⭐️ you don’t then go back and unattenuate it.
But bearing that in mind, the Ricardian Fallacy then interacts with another thing that economists do;
--⭐️ they collect data.
Data gathering is almost never a neutral activity;
it takes place within a theoretical framework.
And what this means is that if the system for gathering, classifying and tabulating the data was designed by people who had a particular model,
👉then the data will most likely support that model.
Everything which is part of the model will be well-verified, data-driven, empirically based and so on.
Everything which isn’t part of the model will be handwavey, subjective, “hard to quantify” and other synonyms for “probably special pleading and made up”.
In the book, I have a subsection called “How Ricardians Win Arguments”
and this is how:
– they collect the data.
⬆️ Returning from the digression,
the important thing to understand is that the financial accounts are a model of the business.
They incorporate a lot of assumptions, of which perhaps the least analysed but most important one is “the financial year is a meaningful time period for this process”.
Some things appear in the accounts, and they are the things which can be backed up with numbers.
Other things don’t, and therefore they can’t.
(Or best case, they can only be backed up with ad hoc, unaudited numbers which everyone will be suspicious of).
💥I think that’s one of the deep causes of what went wrong in Boeing;
♦️the McDonnell-Douglas executives were the ones who could back up their business cases with a ream of #hard #data.
♦️The legacy Boeing executives were left talking about #culture and #best #practice and all sorts of soft-sounding things that were hard to put into a model.
⚠️The Ricardians won the argument, and 🔥the disastrous decisions turned out to have been made without anyone realising they were making them -- when they decided to use the financial reporting system as a tool of management
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backofmind.substack.com/p/how-…
** Odd Lots Podcast
podcasts.apple.com/us/podcast/…
how the wrong side won at Boeing
the Ricardian fallacy, operationalisedDan Davies (Dan Davies - "Back of Mind")
Another aspect of debt,
considered as an information technology,
is that if affects the information environment of the borrower.
If you are managing a company which has borrowed money,
making your payments becomes one of the survival conditions for that company.
At low levels of debt, generating short term cash flow is one priority among others,
but for a highly indebted company it becomes a signal which swamps all others.
You might want to change the world, but if you don’t meet the coupon payments, you’ll never get the chance to see if your other strategic priorities would have worked.
Consequently, a company with lots of debt cannot help but have a bias toward the short term.
Which might be considered problematic,
as the last few decades in the Western capitalist world have seen the rise of an industry
(leveraged buyouts, or “private equity”)
which has made it part of its fundamental operating strategy to load companies up with debt.
Considered in this light, debt is a technology of control as well as of information
– it’s a means of exerting discipline on management teams who might otherwise be tempted to follow priorities other than short-term financial returns.
This is, as far as I can tell, the real meaning behind the populist critiques of “#financialisation” in the economy.
There’s really nothing particularly bad about the growth of the financial sector,
even to the extent that it’s outstripped the growth of the “real” economy.
Quite simple mathematics ought to be enough to convince us that as the economy grows,
the number of links and relationships between producers, consumers and investors will grow at a faster rate,
and so you’d expect the parts of the economy in which decision making and information processing take place to grow faster than the “real” economy.
It’s the same logic by which the brains of primates take up proportionally more energy than those of rodents;
finance is part of the real economy, just like the cerebellum is a real organ.
What’s bad about “financialisation” is neither more nor less than the over-use of debt.
Modern corporations do often behave badly,
and they make systematically worse decisions than they used to,
this isn’t a delusion of age.
They do this partly because they have outsourced key functions
(cutting themselves off from important sources of information),
and partly because their priorities are warped by the need to generate short term cash flow.
Both of these problems can in large part be traced back to the private equity industry,
working either as a direct driver of excess leverage,
or as a constant threat which makes managers behave as if they were already subject to its discipline.
#Management #science and #cybernetic #history is all about things which began as solutions,
💥then turned into problems because the world changed.
Once upon a time, back in the 1970s,
private equity and LBOs were the solution to a problem of lazy, sclerotic incumbent management teams,
self-dealing and failing to make tough decisions.
But it’s now the 2020s, and private equity may itself be the biggest problem in our global information processing system.
The way that corporate history progresses is that we try to keep up with the ever-increasing complexity of the world,
♦️and then when this is no longer possible, we have a crisis and reorganise.
We’ve had the crisis
– or perhaps we are still going through it
– and now it’s time to think about how to reorganise.
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amazon.com/stores/Dan-Davies/a…
#debt #information #technology #criminogenic #organisation #Stafford #Beer #Barry #Clemson #accountability #sink #Boeing #737MAX #Boeing #merger #McDonnell #Douglas #engineering #culture #cost #control #Ricardian #Fallacy #hard #data #culture #best #practice