Merry Christmas from Supervillainy

The more things change, the more they stay the same. Finance and geopolitics offer plenty of supervillainy potential this year. It'll be a wild ride.

Brinksmanship: Applied Supervillainy

Due to American political dysfunction, the government shutdown is a thing. While there have been shutdowns before, there are almost always overhyped. It is ironic that such a system promotes brinksmanship, as opposed to reasoned debate. Such is a symptom of dysfunction.

Potemkin Economies: System D and Stealth Inflation

The black and gray market is one poised for rapid growth. Recently, horsemeat was found in hamburgers in the UK instead of beef. This has far larger implications than ruined fast food. This was due to the authentic product being too expensive for the supplier to handle. This is a type of “stealth inflation,” a substitute of lower quality goods instead of the advertised content. A recent Supreme Court case in the US threatens to gut what remains of consumer protections and the ability to sue for violations of them. Given the massive money printing in the US, UK, EU, and other economies, stealth inflation is sure to rise as the currency wars expand. 

System D, the globalized black market, rushes to fill the gap. From anonymous currencies like Bitcoin to shady distributors, the alternative networked economy may soon replace the economy that political and financial talking heads dwell within. Like the Potemkin villages of the Soviet Union, the economic “growth” benefits a few connected individuals at the expense of the many. As Charles Stross writes, worldwide democracy is malfunctioning, as politicians race to defend the illusion of the prior status quo at all costs. 

Those costs increasingly include everything that made those nations free and pleasant places to live in the first place. Civil liberties, developed infrastructure, and other quality of life metrics increasingly circle the drain. The political elites and business elites escape trial with impunity. Faith in governments and economies decreases as do the natural resources that fuel the status quo too many people take for granted. The entire socio-political structure resembles a decaying bridge with heavy trucks driven across it. The wrong one will set into motion a costly cascade of economic and political failures. 

As Alvin Toffler wrote in "The Third Wave," the dominant political and economic machinery of the Second Wave (industrial, bureaucratic nation-states) increasingly fails and falters. The reason many corporate and political elites grasp for power is not out of confidence in the future but desperation. Ironically, the desperate measures they use may easily accelerate the negative trends instead of fixing them, such as silencing and prosecuting whistleblowers instead of dealing with corruption. This allows the tumor of corruption to grow unchecked, and capture or compromise the rest of the "checks and balances" against it. This is why bureaucracies may be vulnerable to "regulatory capture," especially at the highest levels. This is by no means limited to "socialism," as private companies may have books cooked by a corrupt executive seeking to cover up numbers seem better than they actually are. 

The answer lies not in returning to feudalism (whether corporate socialism or "First Wave" agrarian feudalism), but in a "Third Wave" society. The Third Wave (Information Revolution) could create all manner of new systems. Cyberdemocracy, semi-direct democracy (perhaps some fusion of the Swiss and Icelandic models), or perhaps even a distributed polity in the style of "The Diamond Age" may prove viable. 

One possible vector for infiltrating an existing political entity is a form of "auto-immune disease," turning its political and economic machinery against it. Imagine a non-profit corporation, or a corporation serving as a "host" for related subsidiaries, sharing a new organizational structure (workplace democracy with company catered dorms/lodging/etc.).  New industries (including ones to make it self sufficient) could easily bud off and spread. It could offer social capital, technical capital (in the form of education and training), and perhaps legal or political capital (assuming lawyers could be hired). Of course, keeping such a structure from becoming a cult of some sort is another challenge. Of course, some religious and cultural enclaves (especially close-knit ones from various diasporas) could be a good example or place to start from. 

Such alternative polities are a topic for later, however. The bottom line is that despite its best efforts, the Second Wave institutions and status quo are their own worst enemies. New institutions are arising, and often employ swarming tactics against their slower foes. A Second Wave enemy may act like a great white shark, while a Third Wave enemy may act like a school of piranhas. Time will tell how long the Second Wave system takes to fail past, or if it drags the world ecology down with it. As the illusion falls away, the world's Potemkin economies will be revealed for the frauds that they are.  

Boiling Frogs

A popular analogy for the public in many formerly-democratic states is a frog in a pot of boiling water. If the pot is heated too fast, the frog jumps out. But if the temperature is gradually raised, the frog will remain unaware as it is cooked alive. A wise evil overlord, therefore, does not start off with obvious displays of power. They start off maintaining the status quo, and gradually introducing more insidious bills, laws, and extra-legal practices. Ideally, their predecessor(s) may have started these programs, so continuing them is expected of them. 

This is nothing historically novel. One hallmark of such practices, however, is they often occur in states rapidly centralizing power. Such centralization is often a desperate, last-ditch maneuver. The Roman Emperors gradually assumed more and more power, until the Empire collapsed on its own weight. It appears that the US government is hell-bent on repeating this, independently of the legal justifications (or lack therefore of) for each program. The drone assassination program is a perfect example of one, as detailed elsewhere. 

Take, for instance, the contempt of public wishes by politicians. Last year, CISPA was a “cybersecurity” bill that gutted online privacy (amongst other things). An internet outcry caused it to be dropped. Recently, the President has issued an executive order that essentially does the same thing. The icing on the cake is that CISPA has been regurgitated, copied word-for-word from its original incarnation. Worse than that, this comes as the government clamps down on the few rights that are left. 

The metaphor of the boiling frogs is even more appropriate when you consider climate change. The methane clathrates rising from the ocean floor like a Great Old One threaten to deep fry the world and turn the oceans to acidic stew. Whether the world economy, environmental factors, or political structures will collapse first is uncertain. Far more important is to find a way out of the pot.

Shadow Banks, Shadow Economies

Like it or not, currency systems have long been part of civilization. The types of currency range from gold and silver coins to fiat paper bills to digital, decentralized algorithms. What a proper currency allows an individual to do is have a common method for acquiring the services of goods and services. Barter systems were out-competed by currency in the richest countries, although barter returns after disasters and in the informal economy.

Even the most basic barter system allows one to engage in economic activity. Thus, price discovery, or the ability to accurately determine the cost of a product or service, is a precondition for a vibrant economy. Instead, high frequency trading, short sales, and interest rate rigging reduce the foundation of capitalism to a rigged carnival game. This process has been ongoing for decades, and is unlikely to change, no matter what legislation gets passed (as loopholes can be added). Legal gray areas are often not a bug, but a feature of new laws.

In thriving economies, ecosystems, political, and agricultural systems, diversity is a sign of life. Thriving economies allow for plenty of competition, coexistence of large and small. Although some entities out-compete others, others can arise to fill the void. Thriving ecosystems, such as a forest or jungle, have more types of species than a lawn or parking lot. Thriving democracies have a variety of parties. While some parties may become the most common mainstream ones, it is not impossible for other groups to get elected. An agricultural situation with several types of crops (and multiple species of each) means that a drought or pest is unlikely to destroy all of them.

Instead, we face monoculture in all areas. Markets are rigged to benefit a few big firms. Ecosystems are disrupted at even the microscopic level. Electoral districts are gerrymandered to benefit parties and incumbents. Factory farming has replaced conventional farming as a source of food production. The problem with monoculture is that catastrophic failures become all the larger, as they are inherently brittle.

As these systems fail, others arise outside of the existing legal and political framework. This "black market," informal economic sector is today called System D, as discussed before. As things are banned by increasingly corrupt governments, System D is poised to grow. Furthermore, System D itself is the future of many "legit" firms. The "shadow banking" system comprises the majority of the world's currency reserves, existing in legal limbo in offshore accounts. Somehow, multiple times the planet's GDP in debt was wasted and frittered into this black hole. As something new arises, Ragnarok style, the darkness will turn into the new system.

The Magic of Bond: Hermetic Magic and the Original '007'

"Bond, James Bond."

James Bond is the iconic spy in popular culture. While real life intelligence operatives generally prefer inconspicuous, low-profile positions and lots of boring work, the cinematic Bond travels the world in high class tossing off one-liners as he dispatches baddies and seduces women. He prefers his martinis "shaken, not stirred," and Bond himself acts the same under pressure. However, the modern interpretation and almost stereotypical behaviors of Bond differ from Ian Fleming's original vision. In my blog entry today, I'm going to discuss a relevant topic to supervillainy and mad science, the intersection of spies, magic, and popular culture. I have not yet seen "Skyfall" as of writing this entry, but it is on my mind.

Bond's iconic status has more to do with the movies than with the novels he originated in. The novels portray an often blunt, sympathetic anti-hero navigating the murky world of espionage during the Cold War. This is in contrast to the earlier movies, with over the top villains, zany plot elements, and cartoonish evil schemes. Part of the reason this was done was to lower the rating. More outlandish villains and plots allowed the movies to slip past American cinematic rating agencies, compared to a more brutal and "realistic" one. As a result, the silver screen version of 007 became a much-reduced version of the one in the books (at least in the 60s/70s films).

Ian Fleming himself was the real deal when it came to intelligence operations. He was a member of the British T-Force during and after World War II (a 'technical' force responsible for capturing German industrial and scientific know-how), serving alongside fellow bad ass Christopher Lee. There was also the fact many of Bond's own habits and preferences came from Fleming himself (and Fleming's own death was a result of them). The name for James Bond, according to Fleming, came from the name of an ornithologist. Many of Bond's skills are based on a combination of real life spies, commandos, and covert operatives. But how about 007, Bond's famous callsign?

The answer to that question takes us back to the reign of Queen Elizabeth in the 1500s. John Dee was Queen Elizabeth's court wizard, a scholar who combined magical and scientific research. This is what was also called a 'natural philosopher,' sort of a proto-scientist in an era when the scientific method was not quite hammered out yet. A polymath like Dee saw his Hermetic occult research as merely another aspect of furthering knowledge, combined with his more conventional research (especially in astronomy, mathematics, and navigation) and running rings of informants. He used the number "007," with the "00" signifying he was the Queen's eyes on the world. The "7" was used because of mystical significance. Dee himself was also an avowed imperialist, believing in British dominion over the New World. His use of "occult" knowledge was intended to further the power of his employer, as well as his expansive intelligence network. Again, this is a real life parallel between the "dark arts" of espionage and occultism alike. 


There is a writer who continued this train of thought, connecting James Bond, HP Lovecraft, and workplace comedy together. In his "Laundry" series, Stross has a British covert operative handling battling both supernatural entities and rival agencies seeking to exploit them. In that universe and Stross' "A Colder War," supernatural secrets (often involving powerful Lovecraftian forces) were treated in a similar manner to German research after WWII, with the superpowers scrambling to capture them. Other books, movies, TV series, and videogames involve government conspiracies and agents facing the occult, supernatural, and weird, but few seem to directly invoke the common traits between "mysticism" and spycraft.

There's also a videogame that specifically drew parallels between John Dee, James Bond, and Hermetic philosophy: Uncharted 3. The player's opponents for much of the game are a British secret society with vast resources (highly trained operatives, heavy weapons, lots of funding, etc.). A supporting character mentions they were started by John Dee and used many facades of other occult groups throughout history, such as the School of Night and Hellfire Club. Hermetic symbols are used in many of the in-game puzzles and plot points, including a 'lost lab' of John Dee that for some reason, is under a French chateau. There are also more subtle homages, such as one character using a Walther P5 as a preferred weapon. While Bond used a PPK, the P5 was essentially just a Walther PPK scaled up for 9mm Parabellum. The most common pistol in the middle and later phases of the game is the Walther P99, a 9mm pistol used by Bond in the Brosnan era and the start of the Craig era. Recently, it seems cinematic Bond has gone back to his iconic PPK.

Bond's use of gadgets changes with the films and books, but one thing that remains fairly constant is his pistol. There is a good reason for Bond to use a PPK. Originally, literary Bond used a Beretta in the weak .25 ACP caliber. However, a fan suggested that a Walther PPK in the slightly more powerful .32 ACP would be a better sidearm for Bond. There was good reason for this. The Walther PPK was a compact, concealable version of the standard German P38, intended for use by undercover police officers. World War II had left plenty of surplus weapons scattered in Europe's black market for years. Real life intelligence operatives during the Cold War generally preferred weapons they could acquire locally, use, and dispose of without drawing too much attention. The PPK was one such firearm. There are some other interesting facts even about the ammunition it uses.

If there is a caliber with plenty of historical and technical significance, it is the .32 ACP. It was developed by the legendary gunsmith John Browning, and used in the first pistol, the FN 1900, to employ a slide (becoming a dominant feature in firearms since). It was instrumental in helping start and end major wars in the European continent by being the direct cause of death for two heads of state. Austrian archduke Ferdinand was killed by bullets of this caliber, and it was the caliber of the Walther that Hitler shot himself with. Furthermore, most .32 ACP PPK magazines hold 7 rounds of it. Talk about some fun with numbers. If you follow comics, the magical superhero Dr. Strange was threatened by a villain using Hitler's pistol. Afterwards, Dr. Strange held onto it for a while. (However, the gun drawn is a P38, rather than a PPK.) Even the Doctor in "Dr. Who" used a water pistol version of the PPK in the "Fires of Pompeii" episode.

The use of a Walther pistol by Dr. Strange seems rather amusing, as it unintentionally reconnects the worlds of magic and espionage. According to magician and comic book writer Alan Moore, art is literally magic. Today's black magic does not involve dark rituals and Satanic sacrifices, but instead advertising and corporate logos to shape popular consciousness. In contemporary military and intelligence circles, there is concept of psychological operations. Psyops include the use of informants and infiltrators in rival groups, propaganda, shaping public opinion, and similar things.

Like in John Dee's time, these are often performed to benefit the goals of a government, client, or employer. What Moore calls "black magic," we call other things: public relations, marketing, advertising, and the like. Spies have used "soft power" for thousands of years, currently do so,and will continue to. It is literally an innate feature of the job description. Government intelligence agencies, special forces, and advertising/PR consultants may thus be the modern heirs to "dark arts." These things have their place, as many savvy individuals have realized. John Dee, thus, can be seen as both a spy and magician. 

Bond, in many ways, has come full circle. He started as a character in Fleming's fiction, taking cues from real life. Now, he is an icon unto himself. He is a sigil if there was one, as a suave British accent saying, "Bond. James Bond," can instantly bring him to mind. The most famous fictional wizard out of Britain may not be a boy armed with a magic wand or wear a pointy hat, but may be clad in a tuxedo and holding a Walther PPK. That is how Bond relates to magic. We shall see if "Skyfall" lives up to the legacy.