Obviously I have no way to obtain any reliable knowledge about this. To get a feeling for how difficult this question is, it’s enough for me to reflect on how ignorant I am in fact about what happens among top-level insiders in my own (abstrusely technical and completely non-ideological) profession — a question where I’m privy to far more relevant information, and where I also have far stronger incentives to form an informed and correct view.

But if I were to speculate, I’d say that the very highest insiders probably can’t be found among people who go out of their way to participate in public debates about everyday controversies on the internet and in the mass media. This seems to me indicative of intellectual vanity, uncontrolled ideological passion, and willingness to descend to the level of mass-consumption discourse, which is psychologically incompatible with the role of a confident expert who is in charge of running important things. So this would exclude pretty much all of these professors who get a kick from blogging and punditry.

Furthermore, I don’t think people whose primary occupation is in journalism and punditry are real top insiders, with maybe a few exceptions. A real insider may occasionally address the public through mass media in an aloof way, but people for whom the thrill of propaganda and ideological warfare is strong enough that they’d make it their full-time job are, in my opinion, almost always zealous true believers who take the public face of the hegemonic ideology at face value or (possibly at the same time) sleazy and ruthless climbers on the status pole. (Consequently, unlike the top insiders, their worldview is highly incoherent and detached from reality, and they’d be easy to defeat in a truly free and open debate — but their role is to yell propaganda for mass consumpton through the big mass media megaphones and bully and drown out the opposition, not to win fair and honest debates.)

So, I think the real influential insiders of the Cathedral’s economic management are the sorts of people who have high non-political bureaucratic posts in the government (Fed, Treasury, etc.) and their tightly-knit social network that extends into the finance industry — and who would’t ever descent to the level of enthusiastic participation in everyday mass ideological warfare. To apply this heuristic to your list (or rather its subset about which I know enough to try to apply it), it would seem that only Bernanke passes the test.

All this, of course, is highly speculative — for all I know, I may have completely false ideas about how status and influence work in these exalted cirles, which are like a different world for ordinary mortals.

As might be anticipated, I don’t think it is really possible to make solid progress on these questions without simultaneously revising basic intuitions about time and history. That is because the critical phenomenon — the ‘model’ Cathedral-Keynesian response to economic threat — is postponement, or the strategic usage of the future to relieve a problem in the present. ‘Can-kicking’ is perfectly acceptable shorthand for this, and the postmodern ‘concept’ of differance (delay-displacement) is an accurate, if pretentious, alternative.

The postmodernists (taking Derrida as their exemplar), were consistently counter-apocalyptic,and in this respect they captured the Keynesian Zeitgeist as a general cultural syndrome — can-kicking as an interminable, ‘ontological’ condition. Because their assumption was that the revenge of the market could always be parried by State-bureaucratic action, ‘the Real’ was systematically denigrated, as a toothless relic from the dead age of consequences (before the unconstrained play of the libidinized signifier was discovered by the Parisian New Left). Backing out hard from this freak-show is the primary and most attractive meaning of Reaction to me.

Among the stakes of this argument, therefore, is whether generic ‘postmodernism’ is to be vindicated by the terminal disappearance of an effective economic ‘reality principle’. This can be conceived, with equal validity, in terms of the negative — fascist — eskhaton: Triumph of the Will. Can a sufficiently determined politics impose itself upon the future, without encountering insurmountable obstacles, by molding its environment in accordance with sovereign popular will (as represented by its elite administrative proxy)? If it is politics — social power — that in the end decides, then there can be no doubt that fascism, in its essentials, is correct. That would explain its status as the general form of mature modernist political organization. The fact that Austrianism offers the only consistent intellectual resistance to this conclusion is not, in itself, an argument, but only an appeal.

That’s a fascinating question — and my browser unfortunately just destroyed the response I was about to finish typing. I have to go to sleep now, so I’ll post a new one tomorrow.

The revenge of the market does come in regular intervals. But markets are extremely resilient — they can take a lot of abuse, and even when they’re saddled with extravagant perverse incentives, distorted price signals, and subsequent artificial malinvestments, exacerbated panics, and painful readjustment hangovers, they eventually recover. So the Cathedral economic managers can happily go on and induce and exacerbate panics and crashes, each time using them as a “teaching moments” about how capitalism is unstable without their wise guidance and how they’ve again saved it from the brink of cataclysm.

Of course, the quadrillion dollar question is whether they can keep on doing this indefinitely — or if they are each time destroying more of the diminishing institutional and cultural capital that enables the modern markets to be so resilient and fruitful in the first place. Judging by the Soviet example however, it seems like they still have a very long way to go before they get to something that would look like a real cataclysm. (Plus, the Cathedral does seem smart enough to back off from blatantly destructive ideas in matters of economics when they are clearly demonstrated as such — they did back off from their former orthodoxy of gradually moving towards an out-and-out command economy. Of course, in other matters that they care about much more, such as e.g. issues related to sex or race, no such compromise with reality can be expected.)

Meanwhile, the Austro-libertarian prophets of doom are necessarily unable to give any accurate timing for these crashes and panics, even when they unfold exactly according to their theory. The reason is simple: the obvious truth of the weak efficient markets hypothesis. (This, by the way, is the easiest way to debunk any “science” of macroeconomics: if anyone ever made a genuine original contribution to this purported science, this would give him the ability to second-guess the market and get rich by deriving more accurate predictions about future prices. So why do economists pass this opportunity and rush to publish their findings instead? But this also means that an Austrian correctly diagnosing the malady can never tell whether the crash will come tomorrow or at some arbitrarily far point in the future.)

Regarding the “impending Cathedral catastrophe,” the reactionary blogosphere is a mixed bag. One often sees childishly naive expectations that major Cathedral institutions and ideological projects are about to collapse due to the current financial troubles. One also often sees an immature and morbid wish for a total economic and social collapse, as if something better is likely to come out of it. My opinion — which I readily admit to be a speculative and unreliable product of a mind struggling to comprehend an extremely complicated and mendacious world — is that the Cathedral will remain extremely stable as long as it keeps a monopoly of status, prestige, and sanctimony. Whether someone will somehow manage to undermine it, remains to be seen. (Of course, here I’m setting aside the possibility of some external factor that would put an end to the whole system, or even humanity as we know it, like technological singularity or world-ending disasters.)

http://en.wikipedia.org/wiki/File:Public_debt_percent_gdp_world_map.PNG

So it’s from 2007 and an updated version would be great, but anomalies aside developed economies are indebted economies. How do you dominate a new industry? Invest heavy (take on debt) to corner the market. How do you maintain position? Regulation (think Kyoto etc.) to maintain the gap. Debt itself is not a problem so long as you can maintain market position as this generates market confidence (low interest rates), keeps the talent flowing in and ‘guarantees’ growth etc etc (vodafone has always been a good example in the uk… not sure what the equivalent would be). It’s always seemed to me that the big myth of the global financial crisis was the global (as opposed to Western) aspect (at least relatively) – maybe someone over ‘there’ could correct me on that? – Southern Europe is collapsing because it is in direct competition with Germany and therefore ‘unsustainable’ (not because its debt to GDP is, for instance, higher than Japan’s) and the Euro maintains the gap, denying S. Europe the opportunity to absorb additional debt when the shit hits the fan. The US is at the top of the Western tree… That’s why the rise of China (connected to Russia; the rest of Asia; Australia; Iran; Pakistan, Africa etc…) is so significant… At some point, potentially, China will be able to pull the plug/accelerate away and that’s when a financial cliff becomes a real issue for the US… Until then I’m inclined to agree with Vladimir “that with skilled-enough management this process can go on as an indefinite path of slow decadence”.

If you are right, and systematic crash can be dismissed as a relevant factor, what then? It seems to me that neo-reaction has been assembled with implicit reference to an impending Cathedral catastrophe, which has allowed it to strip away (and denounce) all revolutionary ambition. But if the Cathedral is never to be brought to an end by its internal characteristics? Doesn’t it then have to be overthrown?

Now, the Cathedral’s economic management is the domain of a permanent expert bureaucracy of academia and government agencies, which of course blends into the nominally private-sector finance. I don’t think this particular structure has much concern for electoral politics in general, and it certainly doesn’t give much weight to the transient concerns of who will win the next election. Like the entire Cathedral bureaucracy, it operates largely autonomously and without significant public scrutiny — and if something really can’t be done without making a lot of fuss in the political circus, they can easily get press coverage that will present is a plainly necessary course of action to which no sensible mainstream politician could object.

So, I think you’re wrong when you say that “there simply aren’t any Cathedral managers who sincerely care about anything but the near-immediate future” and describe their actions as a “staccato series of emergency measures structured by election schedules.” This would be so if the Cathedral really were a bona fide democratic regime — your observations would then be an unavoidable implication of the well-known objections to democracy from classical political philosophy (which Hoppe has neatly re-formulated in our time). But these criticisms don’t apply to the Cathedral, and nowadays we need entirely new political theory that will enlighten us about the peculiar and historically unprecedented aspects of the system that we live under.

One of these aspects is that the Cathedral in pursuit of its ideological goals, and despite its insistence on democracy and evidently pseudo-scientific official economic theories, displays far more prudence and long-term planning than a democratic demagogue worrying about the next election, or a crackpot socialist or Keynesian economic planner from Austro-libertarian imagination. (Insightful as they are, Austrian economists have a long embarrassing track record of predicting doom and gloom with their simplistic models of official Cathedral economics as either rampant pseudo-scientific craziness or irresponsible following of short-term political expediency.) In fact, I’m increasingly convinced that the real insiders of the Cathedral’s economic management have a much more clear and coherent vision of what they’re doing than what one would assume by taking their official crackpot “science” at face value.

Moreover, even if the situation goes really bad, don’t forget about the power of the official press. One of the benefits that the Cathedral has reaped from its abandonment of out-and-out socialism and central planning is that it makes propaganda far easier. The propaganda of the Soviet regime, with its official total control over the economy, could only resort to downright lying and bullying when things went bad. (Not that this wouldn’t suffice if they had been free of subversion from abroad, of course.) But the Cathedral intellectuals and press can always find a ready scapegoat for all economic ills in whatever remains of the private capitalism. So even if they foul up big time, they can easily do a propagandistic judo move and use this opportunity only to double down on their ideological goals. (After all, they’ve been doing that with every economic crisis at least since the Depression.)

Or maybe I’m wrong. Maybe we’re really heading for the cliff, the people in charge are lacking either awareness of incentives necessary to stop it, and all bets are off once we fall off from it. But the dissidents from the broad Cathedral consensus have been prophesying this for many decades, and yet the suspended animation continues without much disturbance.

I desire to know which class of person is a Cathedral insider, and which clueless. Of Elizabeth Warren, Ben Bernanke, Matt Yglesias, Brad DeLong, Timothy Burke (owner of this blog—Moldbug pointed us to his “manipulating procedural outcomes”) which do you believe to be close to the action?

My own rough guess is that Warren is a naive outsider; Bernanke and DeLong are insiders who lie through their teeth, fully aware that the Austrian Business Cycle Theory and its implications are true; Yglesias is from a less “privileged” background and therefore further out than the other two, being a talented social climber; Burke is a true insider like Bernanke and DeLong. I formed this impression partly from YouTube videos. Bernanke, in debate with Ron Paul, reminds me of Amfortas from Parsifal—dutiful and burdened by sin. In a video from 2006, Yglesias was teed off about having been asked to prove his identity at a convention.

I am partial to the idea of Cathedral as spontaneous order, in which case the optimisation power to which you refer is not entirely a matter of human intelligence. The price system, for example, evinces apparent intelligence that exceeds its constituent human decisions.

My only experience of the Cathedral’s inner action was in following the SOPA controversy. There was a point at which all sorts of internet-related legislation spontaneously popped up, such that blogs like Techdirt had difficulty keeping track. This betrays, to my mind, legitimate intent in addition to the spontaneous order. A detailed view of the legislative process would be most valuable.

The relative importance of calculated decisions, made by a few individuals in freedom, compared to blind conformity to organising principles of the spontaneous order, is significant. If it be skewed towards the latter, the task of distributing status away from the Cathedral seems relatively easy: a matter of breaking a power-opinion feedback loop that traps innocent people in questionable behaviour patterns.

There may be a history of failed attempts to thwart the Cathedral of which I am unaware. Otherwise, is not the metastasis and centralisation of USG mostly a matter of ignorance—of political science, catallaxy and human nature—and laziness, combined with a plethora of petty incentives, rather than design?

I think, now, that Nick Szabo and to a lesser extent David Friedman have correct notions, and crucially there is an incremental path between USG and a soundly constitutional state. Desirable historic constitutions have formed without rational constructivist design. The precursor to such a change is the formation of a robust academic and status-community that is deliberately, fiercely and hermetically sealed from state funding and state involvement. Uberfact, but in meatspace and staffed by fully-funded scholars—and protected by the same latent pluralism that permits the internet to remain free.