The Power and the Money

The Brazilian fiscal cap still makes no sense

McDevite is not answering my call. I am sad. 

But I am not as sad as the people of the Federal Republic of Brazil, right across border from here! (“Here” is Uruguay, on my way to Buenos Aires. And while I am in parentheses and can be pedantic, allow me to point out that “federative” is not a word in American English and the proper translation of “federativa” is “federal.”)

Over in Brazil, Michel Temer is mired in a growing corruption scandal. His woes are compounded by his blatant reactionary conservatism. The man worked to keep women and black people out of his cabinet. He also shoved through a constitutional amendment that insures public spending will shrink no matter what over the next decade. All that plus corruption! Brazil is, once again, a mess.

Now come Filipe Campante and Dani Rodrik with a short essay reiterating just how incredibly stupid the fiscal handcuffs will be for Brazil. They draw a parallel with Argentina. By the 1990s, Argentine governments had racked up a long history of irresponsible monetary policy. So they decided that the best way to promise to no longer inflate would be to throw away the printing presses. The Convertibility Act stated that the Argentine central bank could only issue pesos 1-for-1 with the dollars it had on reserve. 

Of course, the fact that Argentina had no control over its monetary policy meant that an otherwise manageable mild balance-of-payments crisis turned into a depressionary nightmare. The country abandoned the link in a moment of political chaos. 

Campante and Rodrik make the point that the fiscal limit is as problematic as convertibility. If it succeeds in bringing down interest rates and sparking growth, then it will no longer be necessary ... but will by its past success be perceived as a vital totem and therefore be incredibly hard to remove even should it start to cause damage. Meanwhile, if it is unsuccessful it will unsuccessful because the limit itself will become an early focus of political conflict. Either way, Brazil will lose, unless it somehow manages to dodge all economic bullets over the next decade.

So I am at a loss as to why the cap might even be remotely a good idea! But I know people disagree with me. So, Lee Allston, Aldo Musacchio, and anyone else in the know, once again, could you please give me the counter-arguments? Surely I am missing something. 

Alabama peaches

I know, peaches are normally associated with Georgia. But they grow fine peaches in Alabama.

We were driving out near Rosa Park’s home town. On our way back to Montgomery, the kids passed out in the back seat. Those of you who have small children (and most who don’t!) will understand the issue: you don’t want them to wake up before they’re ready! They’ll be about as happy as a hung-over adult roused out of bed after three hours. Not a good thing!

Now, for context, I must say, against expectations, even the most isolated state roads in Alabama are excellent even by Massachusetts standards, and Massachusetts standards are high.

So when we saw a peach stand on a country road — we had a dilemma. My lovely wife wanted peaches. Mi mano, Gabe, who was in the car, thought she should try them. But the kids were asleep, and would surely awake if we stopped ... but we were still more than 45 minutes away from Montgomery and the BBQ place here we planned to eat lunch.

Solution: Gabe and my lovely bride would get out to buy peaches. I would drive around for ten to fifteen minutes, then return and pick them up. Problem solved!

After ten minutes, I come back from my perambulation past prosperous rural houses, in a white part of Alabama that more resembles a lower-middle-class exurb that the kind of rural poverty some might have in mind. 

My wife and mi compa are wandering around the grounds of the peach stand, smiling but looking slightly forelorn; not talking to the three white woman who run the place. They get in. She looks at my mano, who looks back, and they bust out laughing. The story:

The stand was run by three white woman of various ages: likely a mother, a daughter, and a grandmother. My wife approaches them, smiling I am sure, as she does. The grandmother was in the watermelon patch to the left; the mother stayed away. So she asks the daughter, “Which one is sweeter, your peaches or the nectarines?”

“A nectarine is a hairless peach, is all.” Southern hospitality, this is not. 

“Are these peaches grown in the grove back there?” my wife tries again, in the best Noo Yawk friendliness, the friendliest friendly part of this continent, as you know.

“Some of ‘em.”

At this point, I am told, ma had begun conferring with grandma in the back of the patch. My people decide to buy some peaches, and then wound up wandering pointlessly around the grass until I returned.

In the car, after my wife tells the story, mi mano chimes up. “It wasn’t Amma! It was me. It was the Mexican rapist they were afraid of.”  

(Photo from Montgomery proper, or at least a part of the outskirts worthy of its own post. Mano looks like primo.) 

This led to an argument over whether Mexican was the new black, conducted in a jocular tone that I have trouble conveying to white people. Seriously, it was funny! When racist white people are bothered, but either don’t try or aren’t able to exercise power, it can be amusing. (There is a deeper takeaway there that you should convey to the next person who tries to tell you that reverse racism is a thing.)

The argument went on until we passed a big white barn-like structure selling pig parts and pig meat under a big Confederate flag. There, as we drove by, we saw a white woman and a black woman engaged in an animated arm-waving discussion that certainly seemed, to our LatAm-and-Caribbean conditioned eyes, to be a customer arguing with a client.

If that could go on under the traitorious slaveowning anti-American battle flag of the evil Confederate rebels, well, then, I have to say a point for Gabe. Would my wife have gotten that sort of treatment by herself? We may never know. We did not try to re-run the experiment.

Maybe Mexican is the new black! After all, Alabama has officially made it illegal to drive while Mexican, even if you work for the Air Force. 

Another post that is not about Brexit

There are other commentators with far more to say. Of course, most of them are filibustering. I would recommend Brad Delong. He points out that the academics who have purported to lay out what the E.U. should do to reinvigorate the project are making a sad mistake by limiting their recommendations to what they consider politically feasible. Sadly, what is feasible is also insufficient. Europe (or at least Germany) needs to move the Overton Window.

I am now reunited with my family in Montgomery, Alabama, enjoying the expedition and working on things like Argentine innovation history and black migration to Canada. The U.K. is far away.

So I will talk about our exit from the mysteriously deserted South Boston! Southexit? Svexit? 

Note: most Southern (and many Midwestern) towns and cities would seem equally deserted at any time, but that didn’t square with the town’s downtown. Too many shops that looked too dependent on foot traffic! Or at least people parking their cars and getting out. But we saw nobody, not a soul.

Well, we learned was what happening as we approached the North Carolina border. My phone buzzed, and ugly buzz that usually accompanies some sort of weather warning. I was driving, so I handed it over to my compa. He looked at it, said nothing, but a few minutes later he added, “You should speed up. That way.” He pointed towards the strikingly blue sky ahead of us. “No, really. I don’t want to scare you, but you should speed up.”

The phone alert was a tornado warning, telling us to shelter in place. And the sky behind us was ... well, Jesus, I never knew that clouds could actually be green. The blue skies were so blue because a twister was sucking everything up into it.

Nothing happened to us ... but we later read about some tragic property damage and one death caused by the same weather system in North Carolina. Nobody was out because everyone had been told to stay in. It just did not occur to us to check, despite all the obvious warnings from the sky.

We were relieved to make it out of the stormfront and into North Carolina. Our first stop was the Roxboro Cotton Mill. The mill was one of the last holdouts in the slow collapse of North Carolina’s light industry. The mill was one of the last holdouts, shutting down in ‘99. Right now, a public charter school is trying to raise the funds to turn the building into an auditorium and gymnasium. 

 

I could make the abandoned mill into a metaphor for globalization and the subsequent counterreaction. Or I could throw some cold water on that by pointing out that 1999 was before China received normal trading relations (NTR) with the United States and began to hammer manufacturing communities here. But both of those possibilities would take this post close to Brexit.

What has nothing to do with Brexit? Barbecue! We made it from Roxboro to Durham without complication. There, in an excellent way to celebrate our survival, we got some barbecue. It was awesome, very good, worth every bit of plaque on our arteries. Durham, I need not add, is not a particularly southern town. But this was good BBQ!

The only thing of particular interest in Durham said bad things about America, not the South; like I said, it is not particularly southern. We started to head to the interstate around 9pm (to press on to Charlotte that night) only to get stuck in a short downpour that was so bad we had to pull off into a convenience store and wait it out. The store was only minutes from where we had the BBQ, maybe a mile away. It was modern and well-kept. It had a gas station attached. (We filled up.) It had a constant stream of patrons, even despite the near zero-visibility downpour. And all of them were black. 

Obviously, there is nothing surprising about America’s extreme segregation. But it is not something, I think, that we should allow ourselves to forget or begin to think normal. 

Still not about Brexit

The closed road meant we had to turn off Route 360. The detour took us through Scottsburg, which seemed less a town and more a random collection of rather dispersed but also rather nice houses. No people were out and about, unsurprisingly. We turned down another road, navigating our way around felled branches and trees, when we saw the only sign of the election thus far this trip:

The employees were nowhere to be seen, for reasons we soon discovered.

We got back on Route 360, which took us to our destination: South Boston, Virginia. How could we not stop in Southie? Well, South Boston turns out to be a surprisingly pleasant town. In fact, it seemed almost near perfect for a small town. 

I say surprisingly, because most of the small towns that I have visited in further south, in Alabama and Georgia, have been dumps. They might have been cute once, but the automobile sucked the life out of their centers, quite literally demolishing many of the buildings to make way for parking. In some the outskirts are relatively prosperous, if generic sprawl; but in many the outskirts are also suffering. The strip malls are often filled with a collection of check-cashing places and consignment stores, interspersed with churches and (in South Carolina) adult stores. They are, in general, sobering places to visit. 

Conversely, many small towns in New England (and in some parts of the Midwest) have been gentrified. Their centers are cutesy, often dependent on tourism, students, or upscale exurbanites, with shops catering to that trade. They can be like the worst stereotypes of hipster Brooklyn, only with easier parking. 

But not South Boston! South Boston had hit that sweet spot. The downtown was surrounded by pleasant, well-kept houses and a collection of rather nice church buildings. The downtown itself was vibrant, filled with shops, but real shops catering to ordinary people: insurance agencies, furniture stores, the occasional antique shops, restaurants that were in no way upscale. It wasn’t rich, it wasn’t poor, the car hadn’t sucked the life out of it but it didn’t survive as a preserved bit of fakery for the gentry, either.

For example, here is my compa looking puzzled a store selling what seemed to be an entirely random collection of useful stuff. Very useful stuff, yes, and quite nice, but it still isn’t clear why you would need to have it all in one place.

There were also a lot of storefront churches, including one that was a pleasant surprise. And might explain downtown’s vibrancy, only this was the only sign in Spanish that we saw. 

The streets, however, were spookily deserted. A few parked cars, but very little vehicular and no foot traffic. That was a puzzle, since most of the storefronts were filled. What was going on? 

Well, we were soon to discover why nobody was outside save us ...

Not about Brexit at all

I must write something, so I’ll write about the weather! 

I’m on the road to Alabama. We left D.C. sometime after noon, heading south on I-95. The express lanes out of the city were clear, but they disappear in the far exurbs, and we decided to leave the interstate for Route 1 to Richmond. That plan proved a little harder than expected when a shortcut dead-ended at the gates to a massive prison complex, but in general it worked.

Route 1 travels through a combination of sprawl, old towns, and new exurbia. The exurbs can get strange: pods of massive $200,000 attached rowhouses designed — by law — without any stores or bars or meeting places within walking distance. I’m currently reading Zoned in the USA, by Sonia Hirt (Virginia Tech). When I finish it, I may have more to say on the topic. 

We stopped at a Dunkin Donuts, best damn coffee in America, and pushed on to Route 360, aka the Patrick Henry Highway. Why get on a soul-destroyed interstate in a canyon of trees when you don’t have to? The road took us through a quaint area of farms and a landscape that was far less weird than points north in the state. For example, no Confederate symbols. Not one.

Well, maybe one. There were three flags outside the Black Forest Haus in Amelia, Virginia. One was Old Glory. The second was the German bundesflagge. The third ... well, the third looked like the Stars and Bars as we zipped past, but that couldn’t be right, could it?

We didn’t turn around to check, but we did make a U-turn a little past the Tastee Freez because the storm clouds gathering in the distance made for an unbelievable tableau. 

Now, we had a destination in mind, a town we hadn’t known existed:

So we got back on the road ... and right as we did, the rain started, the clouds closed in, the wind kicked up, the visibility dropped. We slowed, and the squall passed ... but downed trees closed Route 360. So we had to get on the off-off-interstate. 

Where we ... 

Another turn in the South

 In 2004, a good friend and I drove around Georgia, Alabama and the Florida panhandle. I had just gotten back from Fort Huachuca, he was getting leave from Fort Benning, and we both had family in Broward County, Florida. (And in my case, Miami-Dade as well.) We had been to the region quite a bit ... but rarely outside the confines of an Army post. So why not take my old Ford Focus and tool around the deep southeast for a few weeks before heading down to Fort Lauderdale? 

It was a great trip. The South is definitely different. The first thing you notice is how the countryside is intensively farmed. In fact, there is this ah hah moment when you realize that most of the woods you have seen are actually tree farms. My buddy said, “We’re not in New England,” after which we started yelling “Niner niner!” every time we spotted anything really alien. For example, take Quitman, Georgia, with the decaying mansions set back from the streets and its obvious poverty and extreme segregation. Neither poverty nor segregation are alien to New York or New England, of course, but once-rich and now-poor all black small towns are not particularly common. The only thing not “niner” in that town was the small market catering to Mexican immigrants.

Or consider Dothan, Alabama. The town depends on Fort Rucker for its existence, but that was not what made it not like New England. Nor did the suburban sprawl around the town; most American towns look like they’ve exploded across the countryside. What made Dothan southern was the way the sprawl had sucked all the life out of the center of the town, leaving it mostly a vasty expanse of parking lots. There was none of the quaint cuteness that would have filled a similar town in New England; but even California towns have more life in their centers. (In that sense, Quitman was actually more like a northeastern town than most Southern ones.)

The deadness of the centers applied to the larger cities, as well. (Birmingham was a partial exception.) We arrived into Montgomery at night, so it was less than surprising that the central city seemed deserted. We did find a nice little brewpub next to a retro-style minor league ballpark. It closed early, but the patrons suggested two other nearby bars. We went to one on the first floor of a motel on a hill at the edge of downtown, where the buzz-cut bartender sold me a $15 contraband Cuban cigar (putatively) that I then got to smoke right at the bar. (Some differences, they are awesome.) But the difference really showed up during the  day, where the downtown seemed to never open. It was an expanse of parking lots, vacant storefronts and drive-through banks, punctuated by the piles of government buildings and frighteningly devoid of traffic. And I don’t mean just pedestrian traffic. Kids could have played hockey in the middle of Dexter Avenue at 10am, if there had been any kids. And lunch didn’t change anything. Did all those government workers stay holed up in their offices?

Now, it is not like the northeast did not have abandoned urban centers when I was growing up. Central New Haven circa 1990? Ugh. The once-great “Hub” of the South Bronx? Awful. Baltimore? You have seen the Wire. And my first visit to Buffalo in 1990 can only be called depressing, along with my second, third and fourth. 

No, what was weird to a northeastern sensibility was that downtown Montgomery felt abandoned but not decayed. The streets and plazas were spotless. The empty storefronts were well-sealed and well-maintained. It all looked as if it had been suddenly abandoned in the face of an invading army. It was strange.

But that was just weird. What made Montgomery downright eerie was all the Confederate memorials. Sure, Rosa Parks had her plaque. And there were no slaveowning banners. But you couldn’t escape the oddly-respectful memorials to the Lost Cause. Statues of “The Statesman,” e.g., Jefferson Davis. Murals in the state capitol (which the legislature no longer uses) celebrating horseback-riding antebellum aristocrats. A memorial to the Confederate dead who served in the “War of Southern Independence.” 

The monuments to the Civil War were even more common outside the big cities: the below picture is from Havana, Florida, and it captures just how strange the monuments are:

Consider exactly what those soldiers were defending their families, communities, state and nation from. And then consider that the term “nation” is in that sentence. Wait ... what?

In southeastern Georgia we saw many more slaveowning Battle Flags than in Alabama, including a bumper sticker on a truck bearing the ominous slogan: “It’s Not Over.” A Shell station off of I-75 right over the Florida state line flew a gigantic Third Flag of the Confederacy. The design of the Third Flag is sufficiently obscure that it leaves little doubt that whomever put it up knew exactly what it stood for; no pretending to hide behind “southern heritage” here.

It completely weirded me out. As I wrote at the time, “It’s not the Cavaliers and the Roundheads, it’s slavery, dude. I can see memorializing the poor bloody soldiers who suffered and died for the CSA, but the CSA’s leaders should be treated the way the Germans treat the Nazis.”

Now, this was late 2004, so some of the strange atmosphere was supercharged from the recent election. In Georgia, an angry pickup driver threateningly tailgated us on a rural road, probably incensed by my Kerry-Edwards bumper stickers. He pulled up next to us and looked like he was about to start something when he noticed my friend was wearing BDUs. He got solemn and suddenly sped off. In Gainesville, we overheard loud laments about the war in Iraq from hospital workers eating at a Japanese steakhouse made up to look like a pagoda. And in Birmingham, Alabama, a diner did in fact serve us “American fries.”

And while not directly election-related, we kept running into angry demonstrations against the use of “Happy Holidays.” This was not a new thing by 2004, but I had lived in Mexico from 1996 to 2002 and spent most of 2002-04 in New Haven, various Army posts, and overseas. So the angry demonstrations against a completely anodyne phrase that had been used in the more Jewish parts of America since before I was born took me completely off guard.

But for all that, the real strangeness had to do with the war. The war that had ended 139 years ago by that point and will reach its 150th anniversary this year. 

Which brings us to a recent comment by Dave Evans of Georgia, who took issue with my characterization of the Confederate flag as the “slaveowning banner.” In the next post, I will lift my response to him from the comments. I think it is worth highlighting. But for right now, I just want to leave it with the statement that driving through the English-speaking South is a far stranger experience for a New Yorker than anywhere in English-speaking Canada west of Quebec.