December 29, 2008

My new VDARE.com column

Now that my argument that an underestimated source of the mortgage meltdown was pro-diversity policies is on the move from from being regarded as scurrilous infamy to being quietly accepted into the conventional wisdom, I lay out n VDARE.com an idea that commenters here and I have been kicking around for some time:

So now let me suggest another even less welcome Big Idea for the rest of the media to get around to in the next several months:

The Crash is telling us that this readjustment can no longer be papered over or postponed.

More.
My published articles are archived at iSteve.com -- Steve Sailer

By Steve Sailer on 12/29/2008 Labels:

20 comments:

Anonymous said...

I don't disagree with the Diversity effect of making a poorer nation, but the actual bubble and deflation seems to me to be beyond just "diversity."

Iceland is not very diverse, and had lots of stupid bubble stuff that caused the nation to crash. It's classic Tulip Mania.

And it happened without any change in any meaningful way to the population. By over-leveraging and getting caught without foreign exchange.

12/29/08, 12:46 AM
Anonymous said...

Iceland is a particular case which is being overleveraged by many "pundits" in this argument. The banks there were in over their heads but the country is otherwise sound. They have advanced programs for fuel self-sufficiency which are almost fully functional. Latest I heard/read is that most vegetables, all fish and most fuel is now locally sourced through irrigation tunnels, hydro- and geothermal power. They are testing various hydrogen/battery powered systems for bussing.

The mistake there was that the central bank thought the commercial banks were making lots of money and did not regulate properly. Iceland is not your typical basket case.

12/29/08, 2:19 AM
Anonymous said...

I well remeber it was the Japanese premier Nakasone way back in '86 who bragged that the USA was 'through' because of the preponderence of blacks and Puerto Ricans in future generations.
I remember that much hostility in the USA was engendered by Nakasone's boast, but we must remember that Nakasone (an archetypal Japanese 'hard b*stard' of whom the post-war economic miracle is owed), must have fought long and hard in 1941-5, and had his own issues with America.

12/29/08, 4:24 AM
Anonymous said...

This is a great vdare column, Steve. Oh, how the commissars will hate you for it.

But I disagree with your contention that this particular Big Idea will filter into the mainstream like some of your other ideas have done recently. Because the radical 1965 mass immigration project is the brass ring. The replacement and marginalization of white America is the holy mission of the hostile elite. It is their holiest of holies. It is the lynchpin in the Great Deconstruction Of The West.

Therefore effective critiques of the hostile elite's radical demographic engineering will be ruthlessly suppressed with everything they've got. I predict their strategy for the coming epic financial crisis will not be retrenchment but will be full speed ahead and damn the torpedoes. Any authentic hardening of the borders will dealt with severely - - probably with multiple false flag operations and wars. Increased global chaos could trigger an official wartime refugee flow into the USA (and Europe) and it could be massive.

Because the current American demographic environment is not fully formed, it's akin to a plot to kill the king that has the potential to stall out halfway completed. And that's not a stable situation for the plotters. Permanent revolution is their idea of stability and they will move aggressively now to lock in the gains made over the past forty years.

In the coming conflagration look for very large numbers of young white American males to be sacrificed on foreign battlefields while at the same time huge numbers of non-white wartime refugees and immigrants flow into the United States.

No way the elites are going to wait until 2042 for a majority non-white America. The gates have been forced wide open and now the rout is on - - and Le Deluge is historically a winning strategy. The Moor's invasion of Spain was achieved in only ten years but the occupation lasted about seven centuries.

12/29/08, 5:38 AM
Anonymous said...

I suspect that your notion isn't too relevant to what went wrong, but may be very relevant to where the new "normal" will be. Not up.

12/29/08, 7:08 AM
Anonymous said...

Now that my argument that an underestimated source of the mortgage meltdown was pro-diversity policies is on the move from being regarded as scurrilous infamy to being quietly accepted into the conventional wisdom..

Actually this is quite a reduced claim from the one Sailer started out with originally- that said "diversity mortgages" were the main source or a major source of the meltdown. That is far from proven. A lot of factors could be a source- the question yet remains as to how SIGNIFICANT those factors are to the OVERALL picture. The notion of a “Diversity Recession” is shaky, and it is not becoming conventional wisdom.


As for Mexican immigration lowering average human capital, Sailer has a point there in terms of lower skill levels, language difficulties, the importation of relatively more corrupt Mexican political culture etc. But it is an open question as to whether the Crash is a readjustment to demographic change, or simply a fundamental reflection of failed policies and practices put in place by whites, even where immigration is not an issue.

Bad financial practices for example will have their blowback- whether "minorities" are involved or not. They appear in lily white Iceland for example as noted by another poster, and helped cause and worsen the US GReat Depression when concern for "minorities" or Mexican immgration wasn't even much of a blip on the radar. Chalking every problem up to "minorities" is just skewed thinking.

Climate warming, crime, illegitimacy, failing educational systems etc were already well underway before Hispanic numbers peaked the way they have in recent years. The major causes of these problems lie with white people, whether in the form of government subsidies and welfare giveways that decrease work incentives and promote family breakdown, or the hidebound mostly white teacher unions that harm education, or the confiscatory government policies that harm saving, and investment, or the greedy white businessmen that prefer to hire illegals for as little as possible rather than American citizens.

White people are the primary source of these problems not incoming immigrants. Indeed, the immigration policies put in place by white people are part of the sinkhole. Said immigrants are responding to the incentives put in place by whites. Do masses of illegal immigrants make these problems worse? Yes, and that is why we should get serious about controlling it. But again, the power to do this is in the hands of white people.

Sailer writes elsewhere:

I've been following social science and public policy for 36 years now. I’ve learned that fixes for social problems are rare.
Well of course humans will always have social problems at some level. But fixes for many of them have appeared in US History, and many of those fixes cleaned up white dysfunction. The white Irish are a case in point- marked by high levels of substance abuse, violence, welfare dependency and educational dysfunction. What helped the white Irish over time is (a) the moral climate of uplift brought about via religion or civic boosterism matched with actual behavior, and (b) a rising US economy that provided jobs and housing. Other white ethnic groups at various times showed their own levels of dysfunction- southern Italians for example, and northern Europeans of the "cracker culture" of the southern US. These people benefited from the "fixes" described above. What is not happening enough these days are those fixes. But again, who is to blame? White people...

On the flip side, immigration has had its benefits. We have to see the whole balance sheet. It has increased total output, and has created additional tax streams to support an increasing older population of retirees. It has served to temper the greedy demands of white unions. But there is a downside as well, which Sailer has well described over many years.

IMHO Sailer is right to point out these immigration dangers, but he is missing the primary cause of them- white people. And said white people are themselves adding more fuel to the fire of corruption and breakdown. For example, it is the mostly white "gay" movement pressing to destroy the centuries old institution of marriage, with dire effects for future generations. It is Black and Hispanic voters in California that put a stop to such nonsense. But what will happen in another 10 years? Unchecked illegal immigration is only part of the problem. The ultimate source is the corruption and greed of white people themselves. Many forget this in their haste to blame "minority" scapegoats.

12/29/08, 10:29 AM
Anonymous said...

Several qualifications to your argument from a recovering economist:

Immigration Effect on Housing Prices

Housing prices are partly a function of expected future housing prices, which are a function of the demand for shelter, which is a function of both the quantity and quality of future purchasers. It is possible that just a reduction in expected future illegal immigration, due to the clarifying illegal immigration debate in 2007, has reduced the expected demand for housing, even if expected income of immigrants has not changed.

Lenders' Judgment of Illegal Immigrants' Ability to Pay Off Mortgages

I don't know that any banker, when betting his own money, held unrealistic expectations of illegal Hispanic immigrants' ability to pay off mortgages. Rather, these lenders were at first under government pressure to loosen loan standards and then able to sell off risky loans to investment banks or to Fannie and Freddie. The investment banks were relying on recent default rates under rising-home-price conditions when they bought the risky loans. They obviously did not take sufficient account of 1) the reliability of some of the borrowers and 2) the inevitable reversal of the housing price bubble, which would dramatically increase default rates. But distance, rather than politically correct delusions, probably accounts for most of these mistakes

The Effects of a Wealth Crisis

There is no inevitable reason why a decline in paper wealth, which is the expectation of future income, should crater the economy, although it can be painful. What is supposed to happen is: 1) individuals who are less wealthy than they thought should save more or borrow less; 2) banks thus have more deposits; which they 3) lend at lower interest rates to individuals and businesses that have need or opportunity for consumption or investment; thus 4) offsetting the spending of the now less-wealthy individuals. If all this happened immediately, there would be not much pain.

There are two basic problems with this painless adjustment scenario. First, the pattern of spending, both consumption and investment is changing. It takes time to reallocate employees and other productive resources to the altered spending pattern. People must be laid off, rehired and sometimes relocated, and retrained. Some businesses must be shut down, others started or expanded. These are the normal and inevitable reasons for a recession or slowdown.

Abnormally, there is the current state of the banks. Step 3 above requires that banks lend the additional deposits, at lowered interest rates, to individuals and businesses. But banks are now seeking to increase the ratio of reserves to loans because of the crash in real estate and some other values. The system for transferring funds from the poorer-than-they thought to the still-functional sectors of individual and business spending has broken down, at least to a degree and temporarily. There is a little of this at the end of any boom, now there is a lot more of it.

The consensus economic forecasts, which presume that with government help banks will return to lending, are thus not calling for any deep or prolonged recession. I think the stock market may be worried, though, that the recovery and our long-term growth prospects will be diminished as a consequence of the political decisions Americans made during the 2008 crisis.

12/29/08, 12:08 PM
Anonymous said...

"I remember that much hostility in the USA was engendered by Nakasone's boast, but we must remember that Nakasone (an archetypal Japanese 'hard b*stard' of whom the post-war economic miracle is owed), must have fought long and hard in 1941-5, and had his own issues with America."

And he was right, whether or not he traded shots with the Marines in Saipan.

12/29/08, 12:23 PM
Anonymous said...

"It has increased total output, and has created additional tax streams to support an increasing older population of retirees. It has served to temper the greedy demands of white unions."

If only...Funny that you think so...

12/29/08, 12:25 PM
Anonymous said...

@Testing99

Iceland or for that matter the UK & Switzerland all have too much large banks (and thus "bankcapital") per capita too bail them all out. This is what top economist Willem Buiter wrote in the FT.

http://blogs.ft.com/maverecon/2008/11/how-likely-is-a-sterling-crisis-or-is-london-really-reykjavik-on-thames/#more-359

He believes it is quite possible that "there is a non-trivial risk of the UK becoming the next Iceland."

@ Steve

Great column indeed. It's even possible to say that the thesis by Lynn & Vanhanen, i.e. that GNP and national IQ are correlated to a high degree, is being validated by the current credit crisis. The more immigrants Western countries admit from low IQ countries, the lower the economic/human capital of that country per capita becomes.

It's actually quite a sad confirmation. If only the leftists were right for once.. What a relief would that have been.

12/29/08, 12:34 PM
albertosaurus said...

Climate warming, crime, illegitimacy, failing educational systems etc were already well underway before Hispanic numbers peaked the way they have in recent years. The major causes of these problems lie with white people

Now there's a real racist or you!

Let's take them one by one.

Climate Warming.

In a sense this is true. the global warming hysteria really took off with the wrongheaded (fraudulent?) Principal Components Analysis in MBH 98. This was the math error underlying the notorious Hockey Stick. Everyone today should recognize the falacy of the PCA in MBH 98. That bizarre variation of PCA is easy for anyone with even a little math background to understand.

Similarly anyone with any kind of econometric modeling background will be more than a little sceptical of the climate modeling that is the foundation of the Global Warming idea.

All the bad statistics and shaky math models were done by white people. So in that sense Global Warming is a white caused problem.

Crime

The black murder rate is about six times that of whites and ten times that of asians.

It is true that Madoff was white and that the neck inside the collar of white collar crimes is usually also white.

Is that what this claim about white caused crime means?

Illegitimacy

Most blacks born in the US today are bastards. Somehow that's supposed to be the fault of whites?

I don't get it.

Failing Educational Systems

Again the school problems of crime, disruptions, and failure to learn are concentrated among blacks. Yet somehow all these problems stem from whites not blacks.

12/29/08, 12:49 PM
Jim Bowery said...

Ignoring the importation of "cognitive elites" from caste societies -- indeed preferentially importing the upper castes of those societies who are escaping from their own problems with "affirmative action" type programs, is contributing to the stratification of society by placing ever increasing emphasis on rent-seeking (the ultimate "elite" game) in the private, as well as public, sector.

It is that rent-seeking that has taken a the destruction of the middle class from a problem to a holocaust.

12/29/08, 3:08 PM
Anonymous said...

"The Moor's invasion of Spain was achieved in only ten years but the occupation lasted about seven centuries."

And even that occupation only ended because of the reserves of Eurovolk to draw on from the Continent. There's nothing of the kind remaining today. We like to pretend the situation is currently bleak, always retaining that glimmer of hope in a miraculous turnaround. Such an outlook, while relevant pre-WWI, is naive. The time has passed, and the only satisfaction certain of us can get is in recognizing that those who've lived off of us will die too.

12/29/08, 3:37 PM
Anonymous said...

Guys, the answer is to have babies and raise 'em right, same as it always has been...

12/29/08, 4:03 PM
Anonymous said...

Permit me a bit of optimism.

The change in the future population makeup of America will not just be a result of immigration rates but will also be a result of differences in fecundity rates.

And fortunately those with the highest such rates have more than average IQ levels (sorry Idiocracy fans).

12/29/08, 4:19 PM
Anonymous said...

Terrifying stuff.

It makes me wonder if it's time for open-borders opponents to rethink the fundamental goal. Maybe it's time to face the fact that mass immigration is politically unstoppable -- but it may still be politically possible to pick and choose where our immigrants are coming from.

What would happen if we conceded some social utility to importing foreign labor for all the "jobs Americans won't do" yadda yadda -- but forced the left to articulate why that labor must come from Mexico when we can just as easily import a few million Chinese?

-PPK

12/29/08, 9:38 PM
Anonymous said...

If the US economy is worth more or less half of what it used to be worth in 1965, it shouldn't be too difficult to calculate when it hits Third World values.
Steve, you've got to factor in outsourcing of manufacture and services, not just the loss of human capital.

12/30/08, 4:49 AM
Anonymous said...

@Too Tall Jones

"On the flip side, immigration has had its benefits. We have to see the whole balance sheet. It has increased total output, and has created additional tax streams to support an increasing older population of retirees."

Actually, because most legal immigration is family "chain migration" the average age of immigrants is probably not lower than the average age of native-born Americans. Therefore immigrants are not going to be much help with the Social Security pyramid scheme. As for the "tax streams", illegal immigrants seldom pay income taxes. They may help to boost corporate and sales taxes, but they also consume more government expenditures than they provide.

BTW I agree with most of your other points.

12/30/08, 4:54 AM
Anonymous said...

It makes me wonder if it's time for open-borders opponents to rethink the fundamental goal.

The fundamental goal is life. Obviously, that cannot be "rethought".

Maybe it's time to face the fact that mass immigration is politically unstoppable -- but it may still be politically possible to pick and choose where our immigrants are coming from.

What would happen if we conceded some social utility to importing foreign labor for all the "jobs Americans won't do" yadda yadda -- but forced the left to articulate why that labor must come from Mexico when we can just as easily import a few million Chinese?


People who lack the power to stop immigration lack the power to make concessions regarding immigration.

12/30/08, 7:10 PM
Anonymous said...

"ben tillman said...

People who lack the power to stop immigration lack the power to make concessions regarding immigration."

Well said. And quite true.

1/1/09, 7:49 PM

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