Eric A. Posner > Quotes

“This arrangement, in which users take advantage of services and the company gains all the upside of the data they generate, may sound novel, but it is actually very old. Prior to the rise of capitalism, feudal labor arrangements worked similarly. Lords insulated their serfs from fluctuations in markets and guaranteed them safety and traditional rights to use the land and to keep enough of their crop to survive. In exchange, lords took all the upside of the market return on serfs’ agricultural output. Similarly, today, siren servers provide useful and enjoyable information services, while taking the market value of the data we produce in exchange. We thus refer to this contemporary system as “technofeudalism.”
― Eric A. Posner, Radical Markets: Uprooting Capitalism and Democracy for a Just Society

“The logical end point of institutional investment and diversification is the coordination of all capital to extract maximum wealth from consumers and workers.”
― Eric A. Posner, Radical Markets: Uprooting Capitalism and Democracy for a Just Society

“It is not realistic to put legal constraints on war powers. Law works through general prospective rules that apply to a range of factual situations. International relations and national security are too fluid and unpredictable to be governed by a set of legal propositions that command general assent secured in advance. Laws governing war make us feel more secure but they don’t actually make us more secure”
― Eric A. Posner

“In our experience, most people living in wealthy cities who consider themselves sympathetic to the plight of migrants know little or nothing of the language, cultures, aspirations, and values of those they claim to sympathize with. They benefit greatly from the cheap services these migrants offer and rarely concern themselves with the poverty in which they live. The solidarity of such cosmopolitan elites is thus skin deep...but it is [still] better than the open hostility many ordinary citizens of wealthy countries feel toward migrants.”
― Eric A. Posner, Radical Markets: Uprooting Capitalism and Democracy for a Just Society

“Right-wing populist movements appeal to historically dominant population groups that have been left behind economically relative to their expectations: the poorly educated, those who live in rural areas, and workers who have lost jobs because of international trade.18 Arguments made by the leaders of right-wing populist movements for trade barriers and immigration restrictions fall on willing ears. But rather than explicitly appeal to class identity or distributive justice, the leaders of right-wing populist movements appeal to the ethno-nationalist creed of “blood and soil.” These groups look nostalgically back to a past when people like them enjoyed greater economic security and higher status.”
― Eric A. Posner, Radical Markets: Uprooting Capitalism and Democracy for a Just Society

“The fact that large, solvent, heavily regulated banks would not lend to each other—or would lend to each other only at historically unprecedented interest rate premiums—and not lend to each other even overnight, was persuasive evidence, universally accepted by policymakers, that the crisis was essentially one of illiquidity.”
― Eric A. Posner, Last Resort: The Financial Crisis and the Future of Bailouts

“Provision of liquidity by the Fed is, conceptually, no different from the government’s willingness to enforce contract rights.”
― Eric A. Posner, Last Resort: The Financial Crisis and the Future of Bailouts

“By contrast, in a liquidity crisis only one creditor can save the debtor: the government. There is no competitive market that offers emergency loans during a liquidity crisis. This means that the government can dictate terms. It can also neglect the interests of other stakeholders or discriminate among them for political reasons. The risk of abuse is far higher than it is in a normal bankruptcy.”
― Eric A. Posner, Last Resort: The Financial Crisis and the Future of Bailouts

“Fifth, while the current mood, reflected in the Dodd-Frank Act, is to limit the LLR’s powers, the right response is to increase them while subjecting the LLR to equal-treatment principles that restrict favoritism.”
― Eric A. Posner, Last Resort: The Financial Crisis and the Future of Bailouts

“A strain of newly minted “cyberlibertarian” ideals informed the early Internet, which assumed that a fairly minimal communications layer was sufficient; obviously necessary higher-level architectural elements, such as persistent identities for humans, would be supplied by a hypothetical future layer of private industry. But these higher layers turned out to give rise to natural monopolies because of network effects; the outcome was a new kind of unintended centralization of information and therefore of power. A tiny number of tech giants came to own the means of access to networks for most people. Indeed, these companies came to route and effectively control the data of most individuals. Similarly, there was no provision for provenance, authentication, or any other species of digital context that might support trust, a precious quality that underlies decent societies. Neither the Internet nor the Web built on top of it kept track of back links, meaning what nodes on the Internet included references to a given node. It was left to businesses like commercial search engines to maintain that type of context. Support for financial transactions was left to private enterprise and quickly became the highly centralized domain of a few credit card and online payment companies.”
― Eric A. Posner, Radical Markets: Uprooting Capitalism and Democracy for a Just Society

“Most people live in urban settings and interact with others over telecommunications networks, implying their well-being is closely tied to and influenced by others around them. In such large-scale, connected societies, it is usually easier to provide benefits to many people as a group than to individuals separately. Information is easily shared by many; applications for social interaction have little value if used only by a few; public transport shared by many is often more economical than individual vehicles. Yet such large-scale services at present are either provided by monopolistic corporations or by dysfunctional public authorities. Fear of the failures of these providers often leads us to wastefully retreat from public life behind the walls of our homes, our gated communities, our private servers, and our individual cars.

As early as the 1950s, economist John Kenneth Galbraith called this the paradox of 'public poverty among 'private affluence': while children are "Admirably equipped with television sets," "schools were often severely overcrowded . . . and underprovided." He complained that a "family which takes its air-conditioned . . . automobile out for a tour passes through cities that are badly paved, made hideous by litter, blighted buildings and posts for wires that long since should have been put underground.”
― Eric A. Posner, Radical Markets: Uprooting Capitalism and Democracy for a Just Society

“While the Fed is usually identified as the Lender of Last Resort (LLR) in the United States, the LLR function is actually shared by the Fed and FDIC.”
― Eric A. Posner, Last Resort: The Financial Crisis and the Future of Bailouts

“Neural nets are nothing new. Researchers have been interested in them on and off at least since the late 1950s. However, until about a decade ago, neural nets were widely viewed as useless: in 1995 one of the founders of ML, Vladimir Vapnik, bet an extravagant dinner that by 2005 “no one in his right mind will use neural nets.”
― Eric A. Posner, Radical Markets: Uprooting Capitalism and Democracy for a Just Society

“If a systemic crisis occurs, the FDIC may rescue a bank in the non-least-cost-way—for example, by paying off creditors who are not covered by deposit insurance or keeping a bank temporarily alive when it is insolvent—when nonpayment of creditors or the bank’s failure would threaten the system.”
― Eric A. Posner, Last Resort: The Financial Crisis and the Future of Bailouts

“Once it is recognized that the role of the state in a market economy is not only to enforce property and contract rights, but to ensure liquidity, then the bailout, properly understood, is no different from the enforcement of property rights. A host of legal consequences follow from this observation. This book gives an accounting of them.”
― Eric A. Posner, Last Resort: The Financial Crisis and the Future of Bailouts

“First they came for the Socialists, and I did not speak out—Because I was not a Socialist. Then they came for the Trade Unionists, and I did not speak out—Because I was not a Trade Unionist. Then they came for the Jews, and I did not speak out—Because I was not a Jew. Then they came for me—and there was no one left to speak for me.24”
― Eric A. Posner, Radical Markets: Uprooting Capitalism and Democracy for a Just Society