That would be Thomas C. Schelling, now age 95, whom the late Paul Samuelson once stated that Tom was the most intelligent person he ever met, presumably beating out John von Neumann, whom Samuelson argued with about cigars and general equilibrium theory, and his relative by marriage, Kenneth Arrow, a few months younger than Schelling, who is generally viewed as by far the most respected living economist, and who was a coauthor of the most famous and influential paper on the conditions for the existence of general equilibrium. But Samuelson thought Schelling was ultimately smarter than either of them. After all, he got his Nobel in game theory in 2005 with Robert Aumann for his 1960 book, The Strategy of Conflict, which was by all accounts on the bedside table of JFK during the Cuban missile crisis, and Schelling, a technical adviser on the 1964 film, "Dr. Strangelove," was reportedly the main driving force behind establishing a secure "hot line" between the US president and the Soviet leader.
But indeed there is more to this, including exactly why Schelling was given the Nobel Prize, which does come from arguments made in his 1960 book. So not long after Nash provided his game theoretic equilibrium, arguably more general than the strictly competitive Arrow-Debreu-McKenzie solution, and providing the Kakutani fixed point trick beyond Brouwer's that Arrow-Debreu used after him, it became known that for many games there are many Nash equilibria, probably more often than there are for ADM equilibria, for which one can find conditions that guarantee both uniqueness and stability, even if there is good reason to believe that these do not hold in economic reality.
So what Schelling was given the Nobel Prize for, and the idea he pushed that contributed to the ending of the threat of nuclear war that most now take for granted when many experts now say we are in more danger of a global thermonuclear war than we were in at least the later years of the Cold War, was that of focal points. His original example was a group of friends living near NYC who want to meet for dinner but do not agree on where to meet. So, they look for a focal point they can all agree on, and back in 1960 he said that might be under the clock in Grand Central Station.
The focal point that Schelling pushed tirelessly in numerous channels, most of them private but highly placed, was that there should be an internationally agreed upon focal point that there should be no first use of nuclear weapons by any nuclear weapons holder, which, if all agree to it guarantees no nuclear war aside from accidents. There was resistance to this, within the US most notably in the air force, especially from the late Gen. Curtis E. LeMay, who not only advocated the use of nukes in the Cuban missile crisis (when we came much closer to nuclear war than most realize), but also during the Vietnam War. His retirement certainly ended the last serious public opposition to Schelling's focal point, which somewhere during the 1970s quietly came into force without anybody publicly saying so. And as a result "many [very well informed] people" say he was more responsible than anybody else for why there was no nuclear war during the Cold War.
Unfortunately it would seem that a lot of recent loose talk has begun to undermine Schelling's long accepted and established focal point that has restrained a possible global nuclear holocaust for decades. It started with associates of Vladimir Putin during when Russia was annexing Crimea loosely noting that Russia could still nuke New York City. Spacibo, guys. Since then people friendly with Putin in other nations have been making even looser remarks as the nuclear cat is out of the bag. I mean, according to some of them, just why cannot we use nuclear weapons anyway whenever and wherever we want?
For those interested, Tom is scheduled to speak at James Madison University at 4 PM on Wednesday, September 14 in Zane Showker 105, but if you are interested you should check with us about details. I certainly hope that he will be able to give this important lecture.h
Barkley Rosser
18 comments:
Schelling also wrote the article containing a review of the novel, Red Alert, that inspired Stanley Kubrick to make Dr. Strangelove. I posted a video a while back of Schelling in a 2008 panel along with Robert Solow and Nicholas Stern. Very high octane discussion!
If I could ask him a question it would be how he felt now, in retrospect, about his falling out in the 1960s with Kenneth Boulding and Anatol Rapoport.
Worth a drive to Harrisonburg! Thanks for the headsd-up, and thanks for the post, content-wise.
No, the loose nuclear talk started in 2004 with a position paper published by the Foreing Policy Institute, espousing the American neo-con theory that first-strike nuclear weapons could be used. It has zero to do with Putin and with Russia.
Neo-con foreign policy supports nuclear weapons. It is public information. Putin-bashing is not a constructive view in light of the obvious policy of the United States as represented by the neo-cons in government.
I think you are going to have to document this better than you have done here, Steve. I have googled pretty thoroughly, and I have come up with nothing like you say out of there then arguing this. Maybe you should provide a specific source, an author, and so on?
There were long people advocating a first strike, with John von Neumann at the top of the list, quite aside from General Curtis E. LeMay. In Appendix A of his Strategy of Conflict, Schelling argued for the no first use doctrine, tying it to his focal point argument. In terms of recent discussion, it has been those around Putin and Trump himself who have revived these kinds of arguments, not anybody at the Foreign Policy Institute that I can discover, at least not in or around 2004.
The cheap talk that has undermined the general no first use norm was started in March, 2014 at the time of the Russian annexation of Crimea and in response to the putting of economic sanctions on Russia for that annexation. It was started by a media chief appointed by Putin named Dmitry Kiselev who ran Russia Today. He started going on about how Russia could turn the US into "radioactive ash" if the US got to be too troublesome. More recently a very young Russian military commander has been yapping about how Hiroshima and Nagasake were "not that bad," not as bad as the fire bombing of Dresden. So what is all the whup about?
We had the great good fortune to get Schelling as a Phi Beta Kappa lecturer. He came to my game theory class, among other things! This was probably 10 years ago. He gave a University lecture on climate change which, I have to say, surprised me. While he didn't deny anthropogenic GW, he did point to benefits along with costs, pretty glibly, I thought.
Kevin,
Last time we had him at JMU back before his trip to Stockholm, which at the time he told me he did not expect to make although I said he would (and it happened shortly thereafter), he spoke on climate change. This time he offered me three topics: 1) climate change, 2) nuclear policy, 3) deep issues related to prisoner's dilemma. Last spring I saw that the nuclear issue was going to be the really big deal this fall. He seemed reluctant, and I need to finalize it and pin it down, but as far as I am concerned, this is the big one right now.
Samuelson or Who is the smartest smartie?
Comment on Barkley Rosser on ‘The Man Who Saved The World From Nuclear Holocaust During The Cold War’
Who needs an overdose of soft soap? Here it is: “That would be Thomas C. Schelling, now age 95, whom the late Paul Samuelson once stated that Tom was the most intelligent person he ever met, presumably beating out John von Neumann, whom Samuelson argued with about cigars and general equilibrium theory, and his relative by marriage, Kenneth Arrow, a few months younger than Schelling, who is generally viewed as by far the most respected living economist, and who was a coauthor of the most famous and influential paper on the conditions for the existence of general equilibrium. But Samuelson thought Schelling was ultimately smarter than either of them.” (See intro)
The problem with Samuelson has always been that he talked about things he definitively did not understand. These were economics, politics, and intelligence.
Let us put some things straight.
(i) There is Orthodoxy with microfoundations and it has been nicely defined by Krugman: “... most of what I and many others do is sorta-kinda neoclassical because it takes the maximization-and-equilibrium world as a starting point.”#1
(ii) Methodologically, these premises are forever unacceptable.#2 A smart person realizes this at first glance. Samuelson did not realize anything.
(iii) There is Keynesianism with macrofoundations.#3
(iv) These formal foundations are conceptually and logically defective because Keynes never came to grips with profit. Methodologically, Keynes’s premises are forever unacceptable. A smart person realizes this at first glance.
(v) In Samuelson’s synthesis the defective Walrasian micro axioms and Keynes’s defective macro axioms were cobbled together. Samuelson’s textbook consisted of two well-balanced halves: micro and macro. Needless to emphasize that both halves do not logically fit together.
Science is committed to material and formal consistency. Samuelson’s textbook has ― with a probability close to 1 ― the lowermost scientific content of all textbooks ever written. Supply-demand-equilibrium will forever stand out as the silliest model in the history of sciences. Samuelson’s textbook is an intelligence test and economics students flunk it since more than 50 years.
(vi) Economic policy proposals NEVER had sound theoretical foundations. Whatever economists have argued for or against the market economy is scientifically worthless storytelling. General equilibrium theory is the epitome of a collective intellectual aberration. Economists have no scientific legitimacy in their own domain and by implication none at all in the wider political realm. Having disqualified themselves thoroughly, they are in NO position to assess the intelligence or smartness of people from other domains.
What could be more ridiculous than economists who cannot tell the difference between profit and income philosophizing about the history of the Cold War?
If Samuelson could pass as smart economist, one trembles to contemplate what the rest of the profession was then and is now.
Egmont Kakarot-Handtke
#1 More detailed, the starting point is given with: “HC1 economic agents have preferences over outcomes; HC2 agents individually optimize subject to constraints; HC3 agent choice is manifest in interrelated markets; HC4 agents have full relevant knowledge; HC5 observable outcomes are coordinated, and must be discussed with reference to equilibrium states.”
#2 For details and proofs see blog http://axecorg.blogspot.de/ and working papers http://papers.ssrn.com/sol3/cf_dev/AbsByAuth.cfm?per_id=1210665
#3 Keynes started formally as follows: “Income = value of output = consumption + investment. Saving = income - consumption. Therefore saving = investment.”
Well, Egmont, I never said anything about Samuelson being smart, although he was very much so smart, even if he misguided the economics profession in many ways.
I have elsewhere (on Mark Thoma's site, Economists View) demonstrated how tautologically empty and useless your prattlings about profit are. Will not waste more time with that here and now. In any case your pompous remarks about how all economists except yourself are not scientists are just a pathetic joke.
I appreciated reading your thoughtful interpretation of the significance of Schelling’s work. My remarks are not intended to diminish Schelling’s stature but rather to clarify his contributions.
Here is what he says concluding his Nobel lecture:
“The most critical question about nuclear weapons for the United States
Government is whether the widespread taboo against nuclear weapons and
its inhibition on their use is in our favor or against us. If it is in the American
interest, as I believe obvious, advertising a continued dependence on nuclear
weapons, i.e. a U. S. readiness to use them, a U. S. need for new nuclear capa-
bilities (and new nuclear tests) – let alone ever using them against an enemy
– has to be weighed against the corrosive effect on a nearly universal attitude
that has been cultivated through universal abstinence of sixty years.” [2005, http://www.nobelprize.org/nobel_prizes/economic-sciences/laureates/2005/schelling-lecture.html ]
This statement is at best a tepid endorsement of the no first use (NFU) stance that the US has refused to give since it first acquired nuclear weapons. [http://www.mitpressjournals.org/doi/pdf/10.1162/ISEC_a_00018 ].
However, let’s agree that a NFU stance may be deduced from Schelling’s focal point theory due to what he describes as the decades long international taboo on the use of nuclear weapons. The fact that the US has for all these decades denied NFU shows the limited impact that this theory so far has had for US nuclear policy. Furthermore although Schelling did make the case for Mutual Assured Destruction (MAD), the policy that culminated the Cold War was that of flexible response and escalation dominance (Nuclear Targeting Selection Strategy, NUTS) under President Carter Presidential Directive 59 in 1980. If only Schelling’s position had prevailed!
Considering the claim that Schelling is the brightest mind of the twentieth century in general, and that his brilliance surpasses that of John von Neumann in particular, it is difficult to see how this case can be argued. One argument for Schelling’s stature above von Neumann’s is that he received the Nobel Prize while von Neumann did not. However, von Neumann lived from 1903-1957, and the Nobel Prize in economics was not established until 1969. Von Neumann’s mastery spanned formal mathematics and quantum theory, to which he contributed at the foundational level. This research was independent from his formalization of game theory, which he initiated in 1928 and completed with his co-author Oskar Morgenstern in 1944. He also contributed to the Manhattan Project and to the early science of computing.
By comparison, we can grant to Schelling focal point theory, but this is not a formal mathematical result. Rather it is a psychological means to identify a salient outcome of circumstances modeled as games to which actors may converge. The Nobel Prize organization’s official site states Schelling’s accomplishes to be:
“A creative application of game theory to important social, political and economic problems. Showed that a party can strengthen its position by overtly worsening its own options, that the capability to retaliate can be more useful than the ability to resist an attack, and that uncertain retaliation is more credible and more efficient than certain retaliation. These insights have proven to be of great relevance for conflict resolution and efforts to avoid war.” [ http://www.nobelprize.org/nobel_prizes/economic-sciences/laureates/2005/schelling-facts.html ]
I hope that your main point, that Schelling privately and tirelessly has used his focal point theory to support NFU, is true. He should also endorse taking nuclear weapons off hair-trigger alert. Now is the time for Schelling to make this policy stance abundantly clear and to encourage President Obama to adopt these policies before he leaves office, as it is reported he might. [http://www.politico.com/magazine/story/2016/06/barack-obama-nuclear-weapons-213981]
SMA,
I think that final paragraph you think is so weak is pretty clear when Schelling says, that it is "obvious" that the NFU policy is in the best interest of the US.
I find it amusing that you proceeded to say something as silly as that anybody thought Schellng was smarter than JvN because he got the Nobel and JvN did not. Yes, most of us know when JvN died and that it was more than a decade prior to there being an econ Nobel, the second one of which given went to Samuelson. In fact, when I spoke with Schelling about a year before he got it and I told him he would, he said that he would not because "I am too old." The man is actually extremely modest, in contrast to JvN and Samuelson. Arrow is in between those in modesty, less so than Schelling, but much more so than either JvN or Samuuelson.
I guess you did not pick up on my hint that indeed what was going on was that Samuelson felt inferior mathematically to both JvN and Arrow, and so in some sense put Schelling forward, whom nobody has claimed was some math genius, certainly not himself, who, again, really is amazingly modest. However, whenever I have been in a room with him, he clearly has known more than everybody else in the room put together, which is the feeling I get when I am in a room with Arrow. I do wonder what would happen if the two were in a room together.
I never got that feeling with Samuelson, although he was undoubtedly brilliant and extremely widely knowledgeable, if not always right about some things. An especially sensitive matter with regard to Arrow is that Samuelson actually rejected Arrow's application to be a grad student at MIT the first year that Samuelson was there running things. Given all that has transpired since, this had to be a matter of considerable embarrassment for Samuelson.
I never knew JvN, although my late father did. He was brilliant and arrogant. The debate there is not him versus some mere economist, but him versus Einstein, where indeed he probably had greater sheer math skills, and you seem to think that is all there is to intelligence. Most would say that Einstein had the deeper and profounder insight, even if JvN could solve an arithmetic problem in his head faster than could Einstein.
There is an old joke about the mathematicians at Princeton in the 1930s, then top in the world. It is about what it means when the person says, "the proof is trivial." Regarding one famous mathematician, Solomon Lefschetz, who coined the term "topology," the answer was "the statement is false" (apparently this happened at least twice; he declared the proof of something trivial and it was false). There were quite a few of these, but for von Neumann it was that you could spend the next six months doing nothing but trying to prove it, and you would not succeed. No doubt he was far more brilliant than Tom Schelling, but the latter has the deeper wisdom, and in that regard Samuelson may have been ultimately right about him.
Part 2
Science, to recall, is simply about true/false and nothing else. So, let us return from JFK’s bedside and the cheap talk of “very well informed people” back to reality. Barkley Rosser is an incompetent economist. Proof: he has not realized until this day that economic textbooks are manifest scientific garbage since Samuelson’s firstling of 1947.
What on earth drives Barkley Rosser to pester the EconSpeak blog with his even more incompetent cheap talk about the Cold War? What we know for sure about this period is (i) that it has been a mixture of top secret and heavy disinformation from start to finish, (ii) that historians have NO consensus until this day about what was real and what was hoax, (iii) that physics has been hijacked by politics to a degree never seen in history before, (iv) that scientists failed to prevent or even supported the weaponizing of science.
Barkley Rosser’s Cold War gossip confirms what we already know; science in general and physics and economics in particular has to get out of politics and to distance itself to the highest possible degree from political agenda pushers of all colors. Politics and science do not mix. More, their mixing is a sure recipe for scientific failure as everybody can see with naked eyes: political economics has not produced anything of scientific value in more than 200 years ― it has all been cheap talk.
Egmont Kakarot-Handtke
References
Kakarot-Handtke, E. (2015). How the Intelligent Non-Economist Can Refute Every
Economist Hands Down. SSRN Working Paper Series, 2705395: 1–6. URL
http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2705395.
Schumpeter, J. A. (1994). History of Economic Analysis. New York, NY: Oxford
University Press.
* See http://econospeak.blogspot.de/2016/08/cheap-talk-and-nuclear-war.html
** “It was lucky for me that one of my undergraduate texts referred to Paul Samuelson’s Foundations of Economic Analysis as ‘the most important book in economics
since the war.”’ (Lucas http://www.nobelprize.org/nobel_prizes/economic-sciences/
laureates/1995/lucas-bio.html)
Egmont,
Yeah, we do not know everything about nuclear policy in the US from WW II to the present. But I shall note that some of my "gossip" is from well-informed primary sources. Perhaps you did not read my recent post about the "Man Who Refused To Drink Champagne At Alamagordo." I mentioned that i know his son, who is indeed my very oldest friend (from when we were three years old). I did not say it, but I also knew his father pretty well, now dead, as well as Hans Bethe and some of the other Manhattan Project alumni, most of them now dead.
I also know Tom Schelling pretty well, who I am having in to speak on my campus on Sept. 14. You have already sneered at Tom Schelling, I guess because he has not signed onto your silly drivel about profit, but I think that whether or not he was the most brilliant person Paul Samuelson ever knew (who knew a lot of brilliant people, whatever you think of him), Schelling is most certainly a serious expert on these matters of Cold War nuclear weapons policy.
I do not think most readers here think that I am "bothering" them with such posts, even if they disagree with the contents, as does Steve Douglas, although Steve did say that I was promulgating "dangerous" propaganda, so I guess he thinks I should shut up, but not because I have not bought into the Egmont crank theory of profit.
Part 1 somehow vanished. For full text see
http://axecorg.blogspot.de/2016/08/economics-science-or-cheap-talk.html
Egmont,
Can you explain to me, please, why your silly stuff about profits says jack bananas about the intellectual capabilities of a man like Thomas Schelling to discusss nuclear war policy when Schelling never wrote about or cared about profit rates or how profit and income are defined?
Economics and Project Augean Stable
Comment on Barkley Rosser on ‘The Man Who Saved The World From Nuclear Holocaust During The Cold War’
For every intelligent person it is crystal clear that economics is a failed science. The two main tasks at this critical juncture are (i) positive, i.e. to promote the necessary paradigm shift, and (ii) negative, i.e. to get rid of the scientific dung of the past 200 years. The latter task compares to the Fifth Labor of Heracles and is therefore called Project Augean Stable: “[Augeas] is best known for his stables, which housed the single greatest number of cattle in the country and had never been cleaned, until the time of the great hero Heracles.”*
The problem with Barkley Rosser is that he neither contributes to (i) nor to (ii) but steadfastly continues to produce dung.
Since Smith and Marx economics claims to be a science. And this claim is officially enshrined in the title: “Bank of Sweden Prize in Economic Sciences in Memory of Alfred Nobel”.
Economics started as Political Economy. Political Economy is agenda pushing and economists from Smith, Ricardo, Marx, Keynes, Hayek, Samuelson to the present were agenda pushers first and scientists second. As a matter of fact, they were lousy scientists because they never figured out how the monetary economy works. How do we know this? We know this for sure because the profit theory is false as every economics student knows from the Palgrave (Desai, 2008).
Let this sink in: until this day economists have no idea about what profit is. This means that they have no idea how the market economy works. This in turn means, that their policy guidance is not only scientifically worthless but possibly harmful if applied. This in turn means that economists bear the intellectual responsibility for the social devastations of unemployment, depression etcetera. With their proven scientific incompetence economists are a menace to their fellow citizens.
Project Augean Stable starts with a clear separation of political economics (= agenda pushing) and theoretical economics (= science). The project proceeds with flushing out all scientific dung and expelling all political economists.
I had no idea who Schelling was until I read Barkley Rosser’s posts. In his last piece he said: ... Schelling never wrote about or cared about profit rates or how profit and income are defined”. Looking up Wikipedia I learned that Schelling got the economics Nobel Prize.
Questions: (i) how can it be that an economist who does not know what profit is and who does not care to define the pivotal phenomenon of his discipline is awarded a prize for “economics sciences”, and (ii), why is Barkley Rosser hell-bent to sell an annoying political busybody who has failed in his own discipline as brilliant military/strategical thinker, and (iii), why is Barkley Rosser abusing an economics blog for propagating his silly version of the history of the Cold War, and (iv), why has Barkley Rosser not realized until this day that in the Cold War scientists were either abused or volunteered as useful idiots or fig leaves and that they NEVER were in any position to “save the world”?
Augean Project’s answers: Cold War gossip/storytelling out of economics ― flush. Abolition of the the economics Nobel Prize ― flush. Expulsion of economists who cannot tell what profit is from the scientific community ― flush. Expulsion of all political agenda pushers from the sciences ― flush. Retiring Barkley Rosser from EconoSpeak ― flush.
Egmont Kakarot-Handtke
* Wikipedia https://en.wikipedia.org/wiki/Augeas
Egmont,
I should not waste my or other readers of this blog's time, but...
(i) There are things in economics besides how to measure the difference between income and profit and the accounting methods used, which is most of what your condemnation of all economics is about, boring empty accountingl. Schelling did game theory, which is not accounting. Sorry you are so out of it.
9ii) Schelling is or was an "annoying political busybody"? He has been amazingly quiet in public for most of his career of many decades. His most public speech on all this was his Nobel Prize address, in which he said not a word about his own contributions to avoiding nuclear war, although many indeed see him as the person more responsible for putting in place the effective norm of No First Use, even if numerous nations do not officially have such policies. For Obama's current effort on this, see my latest post on this. As it was, President Kennedy highly valued Schelling's advice, which pretty much all observers of the situation say was deeply wise and useful. Your characterization is not only insulting, but massively stupid and ignorant. You are an utterly worthless fool for making such ridiculous and indefensible remarks. You shoujld be ashamed of yourself.
(iii) Well, Egmont, because there are people who do not know this stuff, and my version is pretty knowledgeable, and clearly you know squat about any of this. You had not even heard of Thomas Schelling before I brought him up, when I can tell you that in Washington (yes, I hang around there) he is one of the most revered figures around, even though he has not been in the official advising capacity for many decades.
(iv) Since you had not even heard of Thomas Schelling, the person many think played an important role in saving the world from nucldear holocaust, even as he himself downplayed to the point of vanishing his own role in his Nobel Prize speech, what on earth makes you think you are remootely qualified to say what the role of scientists was or was not regarding nuclear war policy from the Manhattan Project to the current day?
You are just making a bigger and bigger fool of yourself with every one of these posts, Egmont. Look in the mirror, get real, and grow up.
Barkley Rosser
(i) You say: “I should not waste my or other readers of this blog’s time, ...” For once, I agree with you.
(ii) I said “I had no idea who Schelling was until I read Barkley Rosser’s posts.” So, when I asked “why is Barkley Rosser hell-bent to sell an annoying political busybody” I paraphrased his own characterization “Schelling pushed tirelessly in numerous channels, most of them private but highly placed, ...” from the perspective of those highly placed.
(iii) The whole story is surreal. Tell a highly ranked military that Schelling saved the world in the Cold War and he will laugh three days and then drop dead of apoplexy. Einstein was very well aware that for the scientists the game was over before it began: “When a reluctant Albert Einstein wrote the letter to President Roosevelt that set the American atomic bomb project in motion, he ruefully predicted to his colleagues: ‘You realize, once the military have this, they will use it, no matter what you say.’”*
(iv) Not knowing more of Schelling than Barkley Rosser posted here, I am pretty sure that Schelling knew all this, too. After all, he was more brilliant than the brilliant but arrogant von Neumann and the brilliant but inferiority-complexed Samuelson and the brilliant equilibrist Arrow put together. So, yes, it is probably Barkley Rosser who is the busybody here. I am pretty sure that Schelling, now age 95, is rather annoyed of being paraded as world saver before politically retarded economics students by the storyteller, namedropping sitcom economist and time waster Barkley Rosser.
Egmont Kakarot-Handtke
* http://www.nuclearfiles.org/menu/educators/study-guides/history_decision-to-drop-bomb_print.htm
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