Pursuit of Truthiness

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Archive for the ‘history’ Category

The Reverse Syrian Refugee Crisis of 1915

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In 1915 there was a flood of refugees from the Armenian genocide being forced into Syria, on a sort of Trail of Tears. I just learned of this from the excellent book, Lawrence in Arabia, that I’m currently in the middle of:

“As for where this potentially vast sea of internal deportees might be sent, Talaat and Enver had already selected a spot: gathered up from across Anatolia, most would be herded down to the barren reaches of northern Syria. The insanity inherent in this scheme, of uprooting a vast population and casting it into a land already devastated by the deprivations of war, would play out to obscene result: by best estimate, some 800,000 of the Armenian deportees were to perish—starved, shot, or beaten to death—en route.

The consensus among historians is that [Ottomian provincial governor] Djemal Pasha stood very much apart from his Young Turk coleaders in his response to the expulsions. In June, the first survivors of the death marches began to trickle into the north Syrian city of Aleppo, a way station toward their intended destination, the “relocation zone” of Deir al-Zour some one hundred miles to the east. Visiting Aleppo, Djemal Pasha was horrified by what he saw. Reiterating a March decree that commanded his army to protect the Armenians, he lobbied Constantinople to impose the order on military units where it really mattered, in Anatolia. That plea was ignored.

Getting no satisfaction from Constantinople, Djemal allowed thousands of Armenians to remain in Aleppo rather than continue their death march, and despite the deepening hunger and food shortages spreading through Syria, he ordered an increase of government food aid to the refugees. Testament to his love of order and regulations, he issued a rash of new edicts directing that the army regulate and maintain the food supply for the Armenians, that cars and horses be procured for their transportation, even that each refugee be given a financial allowance. But implicit in the stacks of documents that the Syrian governor signed in his office each day was the notion that his regime actually had the wherewithal to carry out these initiatives, never mind that all evidence—evidence that started just outside Djemal’s office windows and stretched to the farthest corners of his realm—argued otherwise. It was as if he fancied himself the administrator of a canton of peacetime Switzerland, rather than of a poor and highly fractured region the size of Italy that was being ravaged by war, hunger, and disease. In the face of the Armenian crisis, as with so many other problems that came his way, Djemal responded with a mixture of bluster, threats, and pleas, and when none of that worked, he simply averted his gaze. By September, with the crisis worsening, he issued a new edict, making it a criminal offense to photograph the Armenians.”

Written by James Bailey

December 10, 2015 at 3:59 pm

Emancipating Slaves, Enslaving Free Men

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The title comes from an Abraham Lincoln quote: “Towering genius… thirsts and burns for distinction; and if possible, it will have it, whether at the expense of emancipating slaves or enslaving free men”

I find myself wanting to save quotes every couple pages; I’ve tried to put only the best of the best here. Jeffrey Rogers Hummel presents a lot of interesting facts I never knew, and weaves them into a compelling thesis about slavery and the US Civil war- one that doesn’t really fit with any of the political or historical “sides”.

One part of this thesis is about the causes of the war. Hummel points out that “what caused the civil war” is really two questions: why did the South secede? and why did the North not let them go? The answer to the first is definitely slavery. The answer to the second is less clear, but seems to largely be mystical ideas of union.

Some awesome quotes that surprised me:

Many abolitionists supported secession: “[Abolitionist William Lloyd Garrison] went so far as to denounce the Constitution for its proslavery clauses as ‘a covenant with death and an agreement with Hell.’ During one 4th of July celebration, he publicly burned a copy, proclaiming: ‘so perish all compromises with tyranny!’ He believed that if anything the North should secede. That way it could become a haven for runaway slaves. The slogan ‘No Union with Slave-Holders’ appeared on the masthead of Garrison’s Liberator for years.” (p21)
“The Georgia legislature offered a reward of $5,000 to anyone who would kidnap Garrison and bring him south for trial and punishment.” (p25)

Pro-slavery Communists were a thing: “[George] Fitzhugh defended slavery as a practical form of socialism that provided contented slaves with paternalistic masters, thereby eliminating harsh conflicts between employers and allegedly free workers… ‘A Southern farm is the beau ideal of Communism.’” (p23)

Through the Antebellum era as Northern state governments become more anti slavery, Southern governments supported it ever more strongly, even against the wishes of slaveowners: “Nearly every slaves state reintroduced or tightened restrictions upon whites privately emancipating their chattels… advocating abolition became a felony in Virginia in 1836.” (p25)
“Only in the Southern United States [of all the Americas] did legislators try to bar every route to emancipation and deprive masters of their traditional right to free individual slaves.” (p44)

Runaways are the Achilles heel of slavery.
One response to this is mandatory patrols to catch them: “Loosely connected with the local militia, patrol duty was compulsory for most able-bodied white males.” (p48) Proslavery theorist (and socialist) George Fitzhugh noted these patrols “secure men in possession of a kind of property they could not hold for a day but for the supervision and protection of the poor [who couldn’t pay their way out of patrol duty].” (p48) Stephen Douglas, of Lincoln-Douglas debate fame, echoed this: “slavery cannot exist a day or an hour anywhere unless supported by local police regulations.” (p117)
Yet “The South’s compulsory slave patrols are one of the gaping holes in the scholarly literature.” (p72)

Hummel is quite economically literate, and provides a convincing model of the economics of slavery and the importance of runaways. “Although slaveowners merely earned market returns [because of competition], they had powerful incentives to perpetuate the peculiar institution. The total value of all slaves in the United States as of 1860 is estimated at between $2.7 and $3.7 billion… ‘Were ever any people civilized or savage, persuaded by any argument, human or divine, to surrender voluntarily two thousand million of dollars?’”
“The individual runaway both helped provoke secession- northern resistance to fugitive recapture being a major southern grievance- and ensured that secession would be unable to shield slavery in the end.” (p353)

Most societies ended slavery through voluntary and/or compensated emancipation. The US took its own peculiar path, a civil war among whites with largely uncompensated emancipation. But there is also the Haitian alternative of slave insurrection. “[Frederick Douglass’] influence caused a National Negro Convention meeting in Buffalo to reject by a single vote a resolution calling for slavery’s violent overthrow…. In 1858 [Lysander Spooner] circulated plans for fomenting slave rebellions… Northern conspirators would assist with money, arms, training, and volunteers.” (p59)
“The massive uprising that [John] Brown, Lysander Spooner, and David Walker each hoped for would obviously have resulted in much loss of life, but worth speculation is whether it could even have approached the civil war’s unmatched toll: one dead soldier for every six freed slaves… this who complacently accept this as a necessary sacrifice for eliminating an evil institution inexplicably blanch at the potential carnage of slave revolts.” (p355)

The Antebellum conflict over slavery lead both sides to discard the rule of law: The Fugitive Slave law of 1850 meant that “free blacks had no legal recourse if a Southerner claimed they were escaped slaves. The law consequently spawned an unsavory class of professional slave catchers, who could make huge profits by legally kidnapping free blacks.” (p94) In response, “Northern mobs, which once had directed their fury at abolitionists, now attacked slave catchers, broke into jails, and rescued fugitive slaves… the national government tried vigorously to prosecute the law-breakers responsible for such defiance, but northern juries refused to convict.” (p95)

This lawlessness became much more pronounced once the war began. In fact, we came very close to total banana republic territory: “Lincoln simply ignored [Chief Justice] Taney’s opinion [ruling against Lincoln’s suspension of habeas corpus]. He also wrote out standing orders for the Chief Justice’s arrest, although these were never served… Secretary of State Seward ordered a lightning statewide raid that jailed thirty-one [Maryland] legislators, the mayor of Baltimore, one of the state’s Congressmen, and key anti-Administration publishers and editors. At the state’s next election in the fall of 1861, federal provost marshals stood guard at the polls and arrested any disunionists who attempted to vote.” (p142-3)
Both sides turned to conscription, and in 1864 the Confederates began assigning soldiers to industrial work. “Insofar as these soldiers were conscripts, the Confederacy was running its factories on coerced labor. The internal logic of military conscription had led the nation of black agricultural slavery to the ironic but appropriate institution of white industrial slavery.” (p251)

Lee was not the only high-level confederate who disliked secession: “[Confederate President Jefferson] Davis had been only a reluctant secessionist, while Vice-President Stephens had actually fought against his state’s withdrawal from the union.” (p135)

When Southern states started to secede, it would seem that conflict over federal possessions in the states, like Fort Sumter, was inevitable; but in fact almost all of them passed over peacefully: “Union authority meanwhile evaporated from the deep South. Federal officials resigned in droves. State troops took possession of customhouses, post offices, arsenals, revenue cutters, and military posts… only Fort Sumter in Charleston and three other forts along the Florida coast had garrisons of sufficient size and determination to keep them in Union hands” (p136-7)

Crazy Abraham Lincoln facts: “Among the ‘rules and regulations’ that Lincoln’s militia unit adopted were: ‘no man is to wear more than five pounds of cod-fish for epaulets, or more than thirty yard of bologna sausages for a sash; and no two men are to dress alike.’” (p157) “The highest commander is assumed responsible under most circumstances for operations under his control. American Presidents can sometimes escape the full force of this dictum because they delegate military responsibilities to subordinates and then take a hands-off attitude except for major objectives and policies. Only Lincoln, of all wartime Presidents, interfered in day-to-day military matters… one of the reasons Northern generals in the west usually performed much better is because they were too far away for Lincoln to foul things up.” (p174) “My paramount objective in this struggle is to save the Union, and is not either to save or destroy slavery. If I could save the Union without freeing any slave I would do it” -Lincoln (p207-8)

The Confederates may have made an even bigger military blunder right from the beginning by eschewing guerrilla war: “the Confederate high command never entertained any thoughts of conducting the kind of war for national liberation that Americans had fought during their revolution and that has become commonplace in the modern world… although much of the South would have remained exposed to invasion, Union willpower would have been patiently worn down through insurmountable logistical obstacles, continual hit and run harassment, and the countryside’s implacable hostility.” (p179)

We are usually taught that slavery was ended by Lincoln’s Emancipation Proclamation and the North’s victory in the war. But slavery may have been doomed as soon as the South seceded and the North started encouraging runaways: “’The institution of slavery is already so undermined and demoralized’ wrote Linton Stephens to his brother, the Confederate Vice-President in October of 1863, ‘as never to be of much use to use, even if we had peace and independence today’… Liberation, so often presented as something the Union did for blacks, was as much something they did for themselves.” (p212)

At least by the desperate times of 1865, the Confederates were willing to give up on slavery: “the Davis Administration promised full emancipation to the British and French governments in exchange for recognition.” (p281)

Louisiana makes many appearances, none of them flattering: “In the words of a Carpetbag governor of Louisiana, ‘I don’t pretend to be honest. I only pretend to be as honest as anyone in politics… Why, damn it, everyone is demoralizing down here. Corruption is the fashion.” (p314)

Somehow I had no real idea who Salmon P. Chase was before reading this book. Turns out he was a Governor and Senator from Ohio, US Secretary of the Treasury under Lincoln, Chief Justice of the Supreme Court, and founder of 3 political parties- including the Republicans. “Chief Justice Salmon P. Chase, in one of the most astonishing cases of intellectual honesty on the part of a public official, implicitly branded his own prior actions as Secretary of the Treasury unconstitutional when the court struck down the Greenback’s retroactive legal-tender provision.” (p330)

Either a slave revolt or compensated emancipation might have had much better outcomes than the Civil War: “Rather than revolutionary violence wielded by bondsmen themselves from the bottom up, a violence that at least had the potential to be pinpointed against the South’s guilty minority of slaveowners, the Civil War involved indiscriminate State violence directed from the top down. Nor would an insurgency’s economic devastation likely have reached the war’s $6.6 billion cost (in 1860 prices), about evenly divided between the two sides. The North’s portion alone was enough to buy all slaves and set up each family with forty acres and a mule.” (p355)

Operation Paperclip

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I just finished the great book of the same name by Annie Jacobson. I had heard of the program that brought Nazi scientists to America, but didn’t realize how big it was- several hundred scientists- or just how complicit in the holocaust many of the scientists were- from the slave labor that built Werner von Braun’s rockets, to medical experiments on unconsenting prisoners, to high positions in the SS, to straight up murder.

Nazi science shows the amazing things that can be accomplished with tons of money, no bureaucracy, no morals, and an endless supply of slave labor. Rockets, chemical and biological weapons all went from ideas to mass production in a few years. Most of the medical “experiments”, though, seem more like simple torture than attempts to learn anything.

The Paperclip program is classic example of Crisis and Leviathan- war (WWII) and the threat of war (Cold War) lead to bigger government and more relaxed moral standards. If we don’t do it, the Russians will.

I definitely didn’t realize the interaction between a lot of the craziest shit our military / intelligence / industrial complex was doing at this time. Paperclip scientists were involved in MK-ULTRA, Bluebird and Artichoke, dramatically accelerating the US chemical and biological weapons programs, and in dispersing pathogens in the US.

It was Richard Nixon that unilaterally shut down the US chemical weapons program in 1969- well done. Nerve gas is scarier shit than I realized. Even Hitler never used it, though they had thousands of tons of tabun. This makes Saddam Hussein, and our support of him during the Iran-Iraq war, look even worse.

One big lesson that I take from the book, though the author never mentions it- the importance of institutions. Almost all of the scientists who did the worst things in Nazi Germany ended up being successful, ethical scientists in the US, once they were placed in a system with very different incentives. In fact, the Paperclip scientist who did some of the worst things for the US, Fritz Hoffmann, was one of the only anti-Nazis in the program; but he was working in weapons areas where the US military had the fewest moral qualms at the time.

Annie Jacobson does a great job turning history and original historical research into an informative page-turner. My one disappointment with the book is in its moral dimension. Jacobson claims to dodge the question, saying that the morality of the paperclip program is up for each individual to decide. But she is always implying that it was a bad idea, while avoiding a real discussion. In particular, she never brings up the obvious analogy to the everyday criminal justice system. In one sense, Paperclip was an amazing rehabilitation program; there was almost no ‘recidivism’ among the scientists. But it certainly failed to exact retribution on bad actors, and may have created a deterrence-reducing moral hazard effect (perhaps knowing of such a program will lead others to commit crimes they would otherwise be afraid to). How valid was the argument that ‘if we don’t take them, the Soviets will’? Would the US and the world really be a better place if we had hung Werner von Braun and co as war criminals instead of letting them join NASA and help get humanity to the moon?
Science is power- both for what it allows humanity as a whole to do, and for scientists themselves. When governments realize the power of your ideas and abilities, you can get away with a lot. Nazis, Soviets, Americans, British, French all realized this- more than they do today. You’d think we would at least have standing visa offers to all scientists who aren’t war criminals, after expending so much money and effort to get those who are.

Written by James Bailey

August 5, 2015 at 3:03 pm

Medicare’s Midlife Crisis

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I just finished the 2002 book of the same name, by Sue Blevins.
Overall I found the book too polemic- it seems like the author doesn’t like Medicare and so wrote down all the arguments she could think of against it, even if some were weak or contradictory. But while I didn’t buy the book’s main arguments, I found a lot of interesting facts within, especially about the history of health insurance. I post them here:

Medicare is funded with public money, but claims are processed by private insurers: “Today, Blue Cross and Blue Shield plans process approximately 90 percent of Medicare Part A claims and about 57 percent of all Part B claims.” (p10)

There was a major government program aimed at covering seniors before the introduction of Medicare in 1965: “On September 13, 1960, President Dwight Eisenhower signed into law the ‘Medical Assistance for the Aged’ program, commonly known as the Kerr-Mills law. The program extended coverage to 10 million seniors whether or not they were receiving Social Security benefits and another 2.4 million on Old Age Assistance. All told, 77 percent of seniors were eligible for government assistance under the Kerr-Mills program.” (p20)

Many European countries set up national health insurance systems before 1914, starting with Germany’s Sickness Insurance Act in 1883. But World War I stopped the campaign to set up such a system in the US: “Compulsory health insurance became negatively linked with ‘made in Germany’ and ‘Bolshevism.'” (p27)

“The first hospital insurance program was created in the United States at Baylor University Hospital in Dallas in 1929…. initially it only covered Dallas schoolteachers” (p29)

The American Medical Association fought for years to shut down physicians’ group practices, until the Supreme Court ruled in 1943 they were violating the Sherman antitrust act. Given the explosion in occupation licensing in recent decades (which the current Court isn’t a fan of either), I think the courts’ unanimous opinion on this case, written by Justice Owen Roberts, should be known more broadly: “Professions exist because people believe they will be better served by licensing specially prepared experts to minister to their needs. The licensed monopolies which professions enjoy constitute in themselves severe restraints upon competition. But they are restraints which depend upon capacity and training, not privilege. Neither do they justify concerted criminal action to prevent the people from developing new methods of serving their needs. The people give the privilege of professional monopoly and the people may take it away.” (p33)

The idea of Medicare hospital insurance started as the King-Anderson bill in Congress, and was strongly backed by then-President Kennedy. Doctors and Republicans didn’t like the bill, and promoted alternatives of their own to try to kill it- the AMA proposed “Eldercare”, Republicans proposed “Bettercare”. Chairman Mills of the Ways and Means committee decides to take a new approach to legislative compromise- instead of splitting the difference between the three plans, just pass all of them- a “three-layered cake”. The Democratic proposal becomes Medicare Part A (hospital insurance), the Republican proposal becomes Medicare Part B (physician insurance), the AMA proposal becomes Medicaid. (p46)

Nowadays we are used to worrying the Medicare is going to bankrupt the federal government, and that much of Medicare’s spending is wasteful. But I didn’t realize that even supporters of Medicare had these worries as far back as 1968. President Johnson, who signed the law, said in 1968 that “Between 1965 and 1975, the cost of living will increase by more than 20 percent. But the cost of health care will increase by nearly 140 percent…. part of these increases will be expanded and improved health services. But a large part of the increase will be unnecessary- a rise which can be prevented.” (p59)

In the year 2000, 18% of medical spending by Medicare beneficiaries was out-of-pocket, a higher rate than that paid by the average American (and many Americans have no insurance at all, so pay everything out of pocket). In some ways Medicare really isn’t good insurance. It doesn’t do the one thing insurance really should, and which private plans are now legally required to do by the ACA- put a cap on how much you could possibly end up spending on medical care. (p72)

States Rights: Learning How to Lose

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I’ve been reading some of the Anti-federalst papers and was pretty quickly convinced that sticking with the Articles of Confederation would have led to better outcomes on most issues. Of course, it would probably have led to a worse outcome on one really big issue: slavery.

Race seems to have always been the bane of states rights in the US. Southern states seeking to protect slavery and Jim Crow ultimately led to major gains in federal power in general, and a major loss in credibility to “states rights”. Even if the Southern states weren’t willing to do the right thing on moral grounds, it seems they should have let this one pass simply on pragmatic grounds.

Look at how the power of the Supreme Court has grown over the past 226 years even as the power of states relative to the Federal government has faded. How has the Court accomplished this? Largely by learning when to lose. They have consistently preserved and enlarged their power over the long run by being willing to lose one today. This is how they established judicial review, fought off court-packing, and maintain a good deal of independence from Congress and the President today.’

Conversely, states fought to the death on slavery and lost much of their power, then fought hard to preserve Jim Crow and lost much remaining credibility. It will take a long time to restore the power of arguments for states rights. I hope that the recent history of state versus federal legislation on gay marriage, marijuana, and health insurance has begun to convince liberals that states rights are not so bad after all.

Remembering Adam Smith Efficiently

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Adam Smith is usually remembered as the father of economics and laissez-faire, for the metaphor of the invisible hand, and for its meaning that people acting in their self-interest promote the public good.  A vocal minority likes to point out that Adam Smith was much more complex than this, and in particular that his thoughts on businessmen and the role of government are very different from those of many people who claim to love Smith.  However, I believe that the naive picture of Smith that most people have is in fact efficient, in the same way that peoples’ ignorance of politics is efficient.

Smith was in fact quite complex.  He is thought of as a champion of capitalists and businessmen, but he said they are “an order of men, whose interest is never exactly the same with that of the public, who have generally an interest to deceive and even to oppress the public, and who accordingly have, upon many occasions, both deceived and oppressed it” and that “People of the same trade seldom meet together, even for merriment and diversion, but the conversation ends in a conspiracy against the public, or in some contrivance to raise prices.”

He is thought to have said that people are only motivated by rational self-interest, but he was no Gary Becker.  He recognized that people want to do good, saying: “We are pleased, not only with praise, but with having done what is praise-worthy” and ” To prevent, therefore, this paltry misfortune to himself, would a man of humanity be willing to sacrifice the lives of a hundred millions of his brethren, provided he had never seen them? Human nature startles with horror at the thought, and the world, in its greatest depravity and corruption, never produced such a villain as could be capable of entertaining it”.  He also recognized that people are far from rational, saying “self-deceit, this fatal weakness of mankind, is the source of half the disorders of human life” and “The chance of gain is by every man more or less over-valued”.

Smith is thought to have called for laissez-faire small government, but in fact he suggested several large roles for government, such as putting a ceiling on interest rates to curtail risky investments, progressive taxation, and public education to counter the bad effect of the division of labor: “He naturally loses, therefore, the habit of such exertion, and generally becomes as stupid and ignorant as it is possible for a human creature to become…. in every improved and civilized society this is the state into which the labouring poor, that is, the great body of the people, must necessarily fall, unless government takes some pains to prevent it.”

For a supposed apologist for propertied classes, he sometimes sounds a lot like an anarcho-communist, saying: “As soon as the land of any country has all become private property, the landlords, like all other men, love to reap where they never sowed” (of course, all the classical economists hated landlords, even if they loved capitalists), and “The affluence of the rich excites the indignation of the poor, who are often both driven by want, and prompted by envy, to invade his possessions. It is only under the shelter of the civil magistrate that the owner of that valuable property, which is acquired by the labour of many years, or perhaps of many successive generations, can sleep a single night in security.”

Smith takes his message to the streets

Given all this, how can I say that Smith is remembered efficiently as promoting self-interest, capitalism, and small government?  There are two main reasons.  One is simply that Smith said a lot of things, and it is easy to distort his main message with selective quotes.  As Jacob Viner said, “Traces of every conceivable sort of doctrine are to be found in that most catholic book, and an economist must have peculiar theories indeed who cannot quote from the Wealth of Nations to support his special purposes”.    Smith made no strong effort at self-consistency; again as Viner said, “The one personal characteristic which all of his biographers agree in attributing to him is absent-mindedness, and his general principle of natural liberty seems to have been one of the things he was most absent-minded about.”

In the main, Adam Smith’s message was that markets worked well and that mercantilist calls for government to restrict trade should be opposed.  The usual quotes used to show Smith’s support of self-interest and laissez-faire are in fact more representative of his work as a whole than the quotes I used above to show his nuance.  The most popular such quotes are probably: “it is not from the benevolence of the butcher, the brewer, or the baker, that we expect our dinner, but from their regard to their own interest” and “he intends only his own gain, and he is in this, as in many other cases, led by an invisible hand to promote an end which was no part of his intention…. By pursuing his own interest he frequently promotes that of the society more effectually than when he really intends to promote it.”  He can’t have believed much in the power of altruism as he said “The late resolution of the Quakers in Pennsylvania to set at liberty all their negro slaves,  may satisfy us that their number cannot be very great. Had they made any considerable part of their property, such a resolution could never have been agreed to.”  The list of government policies supported by Smith is very small compared to what modern governments do, though it would not make all libertarians happy.

The main reason I say Adam Smith has been remembered efficiently is that his ideas about self-interest and the invisible hand were what set him apart at the time and what inspired later economists.  People like me who are interested in history and Adam Smith for their own sake should know about the complexities.  But many people before Smith had criticized the conspiracies of business, advocated for government regulations, and recognized that people have many motivations.  What made Smith different, and what later economists built on, was his focus on self-interest and how to maximize happiness.  Adam Smith was not Gary Becker, but his works had the seeds of modern economics in a way that previous thinkers did not, and it makes sense to focus on the parts of his work that would later bear so much fruit.

Written by James Bailey

June 15, 2011 at 6:07 pm

J.S. Mill (1848) on the Financial Crisis of 2007-8

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In his 1848 Principles of Political Economy, John Stuart Mill gives what sounds to me like a description of the “global savings glut” and subsequent financial crisis of the 2000’s:

By the time a few years have passed over without a crisis, so much additional capital has been accumulated, that it is no longer possible to invest it at the accustomed profit: all public securities rise to a high price, the rate of interest on the best mercantile security falls very low, and the complaint is general among persons in business that no money is to be made…. the diminished scale of all safe gains inclines persons to give a ready ear to any projects which hold out, though at the risk of loss, the hope of a higher rate of profit; and speculations ensue, which, with the subsequent revulsions, destroy, or transfer to foreigners, a considerable amount of capital, produce a temporary rise of interest and profit, make room for fresh accumulations, and the same round is recommenced.

A global savings glut lead to low yields on safe investments like US Treasuries.  Investors chasing high yields turned to riskier investments, especially those which could be packaged as safe- like securitized subprime mortgages.  When the risks were realized, the crisis occurred.  Score one for Mill.

Written by James Bailey

June 15, 2011 at 3:12 pm