ANS -- A piece from Brad Hicks on why the building fell.

A very short piece from Brad Hicks linking three things one might not have thought to link.  

--Kim

Brad Hicks

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A few years' back, former IMF chief economist Simon Johnson co-wrote a book that blamed the US's loss in the War of 1812 on the fact that Alexander Hamilton lost an argument, commemorated in one of the "rap battle" scenes in Hamilton the musical. Hamilton wanted the US to immediately borrow a ton of money, yes, even if it had to be at high interest rates, spend that money on improvements to trade and industry, and then immediately raise money to pay it back.

He was accused of wanting to do this to make Wall Street bankers wealthier. He was understood mostly correctly to want to do this because we needed the improvements. But Johnson argued that the real, neglected, over-looked reason why Hamilton wanted to do this was that the US's revolutionary war debts were financed at an insanely high, ruinously high interest rate for one reason he desperately wanted to disprove:

Nobody, and I mean nobody, in the entire global banking world, believed that any democracy would ever successfully raise taxes. Hamilton believed -- correctly -- that if we proved them wrong by passing our first tax increase, he would be able to free up a ton of money (and keep taxes low) by refinancing our revolutionary war debt at a lower interest rate. And he was right. The reason every lender was including an insanely high risk premium in their interest rates was that they all genuinely believed that if voters were given a choice between paying higher taxes or defaulting on their debts, they would always default on their debts.

It's not true ... but it does seem to be one of the reasons why that condo building in Miami Beach collapsed. When the condo board brought in engineers to bid on the repair needs identified in the now-famous (and watered-down) 2018 inspection report, a majority of the residents experienced incurable sticker shock and just flatly refused to believe that it was necessary to spend that much money. They wasted three years trying to find a cheaper way to save the building, despite being told over and over again, by every engineer they engaged, that they were wasting their time. In fact, the time spent trying to find a cheaper way made it more expensive, not cheaper, as decay continued to spread.

And if that's not a metaphor for global warming, I don't know what is.