See it -- Charlie Rose

After many months, I turned on Charlie Rose last night. Tilda Swinton on Charlie Rose. You don't need to pay close attention to appreciate his interviews with people he loves. 

Bill Moyers

(c) 2010 F. Bruce Abel

Bill Moyers program is gone. A big hole on Friday nights now. On the bright side Simon Johnson blogs daily and I guess appears on various media frequently. Charlie Rose purrs along I guess. I haven't watched him for many, many months.

Carlyle

From Christopher Buckley, on Charlie Rose earlier this week, talking about his dad William F.:

"I found this quote by Carlyle: 'Let me have my own way exactly in everything and a sunnier and more pleasant creature does not exist.'"

Blow and Collins and Brooks -- Anger Mismanagement

Yes to Blow:
http://www.nytimes.com/2009/03/21/opinion/21blow.html?_r=1

Yes to Collins:

http://www.nytimes.com/2009/03/21/opinion/21collins.html

Yes to Brooks:

http://www.nytimes.com/2009/03/20/opinion/20brooks.html?em

Yes again to Charlie Rose's interview three nights ago (see blog which caused you readers to spend 16 minutes on average on my blog!)

A Red-Letter Day For Blogging!

Transcript!!! Hank Greenberg and Meredith Whitney, Gretchen Morgenson and Carol Loomis!

Bernanke interrupts....

AIG!

Let me start with a personal insight: trading again after ten years (after all the investment advisors screwed up my money, why can't I do the same thing and have fun doing it?) I note that no sooner than my finger is off the mouse with a "market order" to buy GE it is "executed." Not a milisecond wait. Literally!

Suppose I had bought 10 million shares instead of 260 shares? Supposing I made a mistake on that 10 million shares.

In trading "slippage" happens. When it happens with big money, big bad things happen. More later. This may or may not be relevant to what follows.

AIG!

Let's start with the NYT's excellent interview with legal authorities:

http://roomfordebate.blogs.nytimes.com/2009/03/17/when-bonus-contracts-can-be-broken/

But I came into the kitchen 10 minutes ago because of such a wonderful first 1/2 hour of Charlie Rose just now (an hour delayed),

http://www.charlierose.com/guest/view/838

also on AIG.

The discussion was so important that it temporarily changed my view of Hank Greenberg from negative to possibly positive, and introduced me to at least one new hero: Carol Loomis of Fortune.

This Charlie Rose is so important that I am going to take my laptop and do a verbatim while rewatching the 1/2 hour (the other 1/2 hr deals with Pakistan). Then I will put it in below (above).

But first the incomparable Dowd on this topic!

http://www.nytimes.com/2009/03/18/opinion/18dowd.html?_r=1

From that piece:

"Boiling mad that A.I.G. made more than 73 millionaires in the unit that felled the firm, Cuomo called the company’s counsel on Monday to demand that she stop payment on the checks. Cuomo was informed that the money had already been direct-deposited in the accounts of the derivative scoundrels with the push of a button."

Again:

"...[T]he money had already been direct-deposited in the accounts of the derivative scoundrels with the push of a button."

And Friedman, clumsy and unknowledgeable on financial matters, (he misdescribes credit default instruments of AIG, but so what) still highly relevant on this topic of AIG:

http://www.nytimes.com/2009/03/18/opinion/18friedman.html

Leonhart chimes in, not so artfully:

http://www.nytimes.com/2009/03/18/business/economy/18leonhardt.html

But Ah! Morgenson!

http://www.nytimes.com/2009/03/18/business/18aig.html?ref=economy


"Even though A.I.G. finally disclosed the names of the institutions that received so much of the government money that was thought to be going to A.I.G., the idea that it took six months still rankles some market participants."

“'The system was undermined by asking the American people, under the veil of secrecy, to bail out one company when in fact they wanted to bail out someone else,'” said Sylvain R. Raynes, an authority in structured finance and a founder of R & R Consulting, a firm that helps investors gauge debt risks. “The prospectus for the bailout was not delivered to the people. And it was not delivered because if it had been, the deal would not have gone through.”

Now, a partial transcript. I still do not know whether Hank Greenberg is blowing smoke up our asses...but his comments are interesting. "Meredith" is sensational!

(see above)

Now for Liddy's Washington Post Op Ed piece this morning.

http://www.washingtonpost.com/wp-dyn/content/article/2009/03/17/AR2009031703019.html

And from BlogDredd Blog, we see that it was a Milken team that started AIG's credit default swaps years ago, well before Hank Greenberg left! So he was blowing smoke up our asses last night with Charlie Rose.

http://blogdredd.blogspot.com/2009/03/out-on-false-front.html

Charlie Rose -- John Mack Last Night

Don't bother to watch. I "listened" in the other room, but this would be, I hoped, an hour of a guy (John Mack, Morgan Stanley, MS) who had the credibility, to give us some hope. North Carolina good 'ol boy, married to sister of Charlie Rose's former wife, southern accent, apparantly slower and more thoughtful style (which we need these days!).

But he spent the hour saying nothing! Recapping the history of what had happened to other firms on Wall Street; patting himself on the back for not taking a bonus, etc. NO hard questions by Charlie.

But still, maybe this type of thing will get us through. Just smooth talk by people who seem to have a clean record. (But I don't know that John Mack DOES have a clean record, because I haven't checked.)

And Morgan Stanley seems not to have fallen as much as the big boys.

Author's Comment to Charlie Rose

The Reader

"The individual moral sense is too weak to overcome that situation....We need institutions...to bolster us...And when those institutions fail..." Bernard Schlink, author of The Reader, book, and now movie.

And Charlie Rose's interview with the performers:

http://www.charlierose.com/view/clip/9895

"It remains freightening...how thin the ice is."

Other parts of the transcript notes I have taken:

Best interview ever based on his incisive questions of the author.


Hannah was more ashamed of her illiteracy than allowing people to burn to death. An element of moral blindness. Something really lacking in her. Moral sense. Freedom to do the right thing. Something lacking. Amount of shame about her illiteracy…where everybody masters (literacy).

Working in a factory. Late -- between 2-4 am, workers opened up and told what they did/saw.

Big Auschwitz trial in Frankfort.

There’s a line and once you step over, pretty much anything goes. The first killing and shooting did it. Allowed them to do anything. Many of them. Didn’t want to expose themselves as not doing what the others did.

I can’t forgive.

The individual moral sense is too weak.

Charlie Rose Last Friday

My notes from looking at TIVO

7:27 AM 12/24/2008
notes on Charlie Rose 12/19/2008

Malcolm Gladwell


"Outliers"
The Story of Success

Also wrote The Tipping Point and Blink, both on nyt best seller list. Writes for New Yorker.

Fascinated by performance…and success

Own phenoneminal success…grandmother

Nature of the lucky break
Bill Gates
Walks into 8th gr at lakeside acad seattle; computer term linked into downtown computer; 1968
Basically spends entire teenage yrs programming
With paul allen – mainframe at univ of wash..2-6am. Free
Extraod desire + living 2 miles from a mainframe that’s avail 2-6 in the morning

Beatles

Same thing. Cog complex activities; 10 years; 10,000 hours; always

1st in a cohort to reach 10,000 hours

Tiger Woods

Very good circumstances
deliberate practice...focused, intensive, with an eye on your failures

Michael Jordan as a 16 year old...practices in a different way...what am I not doing well? Why am I not doing it well?
His game changes throughout his career.
not great outside shooter when he starts...added to his arsenal

Charlie summarizes:
access to deliberate practice...over 10,000 times

how to help people achieve their potential:

give them opp to work harder

extend school day, extend into summer

what separates kids who want to work hard?

Can’t work hard unless there’s a school to do it.

Jewish lawyers Bronx and brooklyn

'30s and '40s
end up top of legal prof in New York

because were forbidden to work at the downtown white shoe firms

practiced.....for many years in unfashionable area of corporate law called "takeovers."
later when the demand was there they were in the forefront
NYU

“sleights” are or can be of great importance ... Jordan doesn't make his team at age 9

Colvin says he did not have a sleight.

Talent does not exist…it’s all application.

Beatles went to Hamburg in the '50s...willing to play 8 hr sets a day, 7 days a week, in the nastiest of circumstances

Obama

second part of my book deals with "culture"
how diff cultures have diff strengths
asian kids are better at math tests...huge difference

we know it's not genetic

they work harder...why?

ans: patterns of ag practice; rice.

My father’s European ancest wheat fields of northern england; drunk in winter; worked only 1000 hrs a year
Chinese: 3000 hrs a year; infinitely more labor intensive than western ag

1500 years…doesn't go away

makes you good at math

no one has a better theory

what is your gift?

I'm a child of a mathematician and a therapist

father...highly specialized complex math

mother...communication with people at basic emotional level
(autism).
my writing shuttles back and forth between obscure and how to communicate to a mass audience

my mother is a beautiful translator and my writing role model...she's also a writer

“All good writing must have clarity.”

My mother: having extraordinary mother of her own
Daisy
Jamaican culture
Mom ends up upper middle class in Canada.
Her success…a function of …privileged brown-skinned Jamaican class. Not sent back into slavery as they were in the American South.

lifted out of slavery; Irish plantation owner takes as his concubine
(Daisy)
Colin Powell is my cousin and from the same privileged Jamaican class

Must know about Jamaican history and tangled class…


Charlie:

seeing that goal and wanting to get to that goal

Malcolm

Bill Joy

his time undergrad at Michigan

computer room

we writes the rules on the internet

I have a chapter on Jewish lawyers

parents off the boats...have a sense..my child will end up meaningful...propels kids

Hunter College..one of first gifted programs

kids are basically of genius level

what they end up doing...not that impressive...happy lives but nothing spectacular

kids were so smart that they understood what it would take to be good and decided not to do it!

Paradox of Genius

how completely unimportant is high IQ

our society is obsessed

need to be "smart enough"

iq matters up to 120

have coffee with Nathan Bilbow(?)

ask him any ques..."It is impossible that his answer will not be useful in some way."

He has this ability to construct this network of fascinating people

who gets curiosity and who doesn't?

meaningful work?

(1) autonomous (no one's looking over your shoulder)
(2) complex
(3) rela between work and reward

garment industry is all these things ie meaningful

explicitly enterpreunerial

rela between work and reward

Mexican workers picking fruit in California...not meaningful in any way

what if Jewish had gone to central valley in Calif and Mexicans had gone to New York?

if you are convinced that the thing you are doing is meaningful, then there's no "cost" to it.

most people do not have the time to organize their experiences...I (Gladwell) do

I work (write) in public...coffee houses, book stores. I'm a product of the wash post..newsroom...loud and noisy

in a quiet office i almost lost my mind



Geoff Colvin, author

"Talent is Overrated"


research...what is the source of top-level, world-class performance?

what does seem to be explan... a particular type of hard work

"deliberate practice"

starting young is very helpful...can accumulate more hours...parts of your brain will be affected

areas of your brain take over

can happen at any age; effect is greater when you're a kid

takes 10 years to get good at anything

doesn't matter what field

to get world class

Exh A

Tiger Woods

father put golf club in his hands at age of 7 mos

practiced at age of 2

professional teachers at age of 4

working hard for 17 yrs with proffesional teachers so in his late teens he's way ahead

focusing on something that is critically important

training has to be designed for this moment in your development

Tiger going to sand trap and drop ball so it's fully covered; practicing 200 times; not because he will encounter this a lot, but when he does he will have a feel for what to do.

Chapter 7

applying principles in our lives

practice...will give you finely-tuned instrument



got that way...weren't born that way

understanding your business is critical...some people think that all you need is management skills

you need deep knowledge of what you are doing

what about child prodigies?

mozart

remarkably parallel with story of tiger woods

1st world class work at age of 21

training under his father

refers to Malcolm Gladwell

circumstances

yes, the supporting environment

can be family

larger sense

what's gong on in the civilization around you

where you are born

I Have Updated My Taleb Interview Blog

Type "Taleb" and search this blog.

Taleb Was Interviewed on Charlie Rose Last Night

Taleb is a philosopher, professor ...best known as an author.

"Only 4 pages of this book "Black Swan" is about finance." (Taleb)

Today's Wall Street/World Finance community: Hidden Risks in the system coupled with increasing Complexity in the world coupled with so much Ignorance at the Top. Fooled by the illusion of stability. Bernanke's paper, "The Great Moderation," showed Bernanke was the "turkey." (Turkey is fed by a butcher for 1000 days, then zap.) Turkey is the risk management department. Turkey is financial department. Economics department.

Fooled by the illusion of stability.

Surprise for the turkey. Whole idea is not to be a turkey.

Before the discovery of Australia there was no reason to believe there was anything other than a white swan.

Black Swans in history:

The Great War

100 years of great moderation and stability in Europe (before WWI)

Class of people provide us with all these analytics...

Medieval doctors killed more patients than they saved.

Financial economists are comparable today. They can produce risk measurements that were extremely faulty.

Who is the turkey?

Bankers are the turkeys.

Banks were accumulating a humongous amount of risk thinking there would never be a storm because of the metrics. You have a lot more confidence because of the metrics.

Portfolio theory.

Who got it right?

[Mario] Rubini
Bob Schiller (of Yale) re real estate.

Like a house of cards. Fragility comes from the structure, not a particular component of the structure.

I was looking at a plane flown by a pilot who did not know anything about storms. And the next storm all planes will crash at the same time.

Globalization causes this fragility. All banks are interrelated.

Bubbles caused by debt not asset inflation. A lot more vicious than asset bubbles.

Risk comes from rare evants.

Metrics could not deal with rare events. System was way too fragile.

When my book came out, I started listening to the criticism and nobody attacked my central point. "I was hoping they would!" Gave me confidence to "go for the jugular" ... make a big "bet." [But it's clear from his demeanor he's an adviser, not a punter. So he himself did not get rich from such "bets."] I'd been waiting since 2003.

I made money for my clients. I protected them. I didn't get hurt. Nobody in my family members had bank preferred. People "close to me" were in 100% in cash.

90% in safe cash and municipal bonds. 10% in high risk.

Better than having whole portfolio in medium risk because metrics do not properly measure risk.

With cash you have your powder dry.

Capitalism II

Banks will be utilities.

You want to be able to get cash when you go to Detroit or LA.

Different class of risk-taking. On condition that society will not bail us out.

More symmetry.

A lot of hedge funds will disappear. Never made a penny for their clients.

The Bernanke/Greenspan Era.

Survivor for a different class of people.

Began with Regan Administration?

Over time we have had a switch -- 35 year, or 29 year old analysts -- looking at your numbers and running, in fact, your company. You want to look stable. If someone gives you a metric you can game it. If you own bonds that do not blow up very often your metrics look great.

Orthodoxy of markets being smart. Markets are stupid. Can be fooled by numbers.

Markets are horrible at predicting rare events.

[Mario] Rubini:

Worse than Rubini thinks. We switched from an envirnment of inflation and fear of inflation...


Everybody's referring to one precedent: 1929, which did not involve a lot of countries.

Today one event in America, factory closes a day later in China.

Collapse will occur quickly.

Hedge funds have to deleverage. Selling over time. "Inventory to go."

Someone turning 64:

his 401(K) today is 1/2 its value or worse than it was.

What's he going to do? "Not going to buy stocks." He needs cash to pay for his retirement, his rent and cigars, whatever. He has to sell.

Inventory to go. Who's going to buy? Not me.

Pension Funds, university endowments, everybody is/are suffering.

Some kind of independence from asset values under Capitalism II.

Independence from asset values.

Banks become utility companies. A lot less debt. A lot less speculation. Dentists go back to making money in dentistry, not stocks.

Massive inflation coming.

Paulson is doing a good job.


http://www.charlierose.com/view/interview/9713

The Black Swan

http://www.nytimes.com/2007/04/22/books/review/Easterbrook.t.html?scp=2&sq=black%20swan%20taleb&st=cse

Cramer Was Wrong

Passaing reference was made on the Lehman closing yesterday, where the world of Credit Default Swaps did not produce the horrendous World-ending losses predicted by Jim Cramer. Only $5 billion was AIG's tab, not the $350 billion plus loss. What gives????

Warren Buffett Behind the Scenes Last Week With Charlie Rose

Like J.P. Morgan, Warren E. Buffett Braves a Crisis
new_york_times:http://www.nytimes.com/2008/10/06/business/06buffett.html

By STEVE LOHR
Published: October 5, 2008
In the midst of a financial crisis, a towering figure of American business steps forward with his reputation and financial resources for public good and personal gain.
Their times and personalities are vastly different, of course. But J. Pierpont Morgan’s role in the Panic of 1907 has its echo in Warren E. Buffett’s actions during the current financial troubles.
“What Buffett is doing is similar in ways to what Morgan did in 1907,” said Richard Sylla, an economist and financial historian at the Stern School of Business at New York University. “It’s what you might call profitable patriotism.”
Comparing the two men and their moves in periods of market turmoil, just more than a century apart, reveals how much some things have changed over the years and how other things have not, according to business historians and finance experts.
Morgan was 70 during the financial crisis of 1907, in the twilight of his career. Mr. Buffett is 78. Like Morgan so long ago, Mr. Buffett now finds himself “at the center of things; he draws headlines and he inspires confidence,” said Robert F. Bruner, dean of the Darden School of Business at the University of Virginia, and a co-author with Sean D. Carr of “The Panic of 1907: Lessons From the Market’s Perfect Storm” (Wiley, 2007).
In the last two weeks alone, Mr. Buffett has exercised his influence mainly by investing in embattled blue-chip companies, committing a total of $8 billion to Goldman Sachs and General Electric. He drove hard bargains and invested on favorable terms.
Mr. Buffett has been fielding many phone calls recently because of his cash, his reputation and his ability to act quickly. The G.E. investment, for example, was put together in a matter of hours, after G.E. reached out to Mr. Buffett through his longtime banker at Goldman Sachs, Byron D. Trott.
“In the last few weeks, everyone who has been in trouble or thought they were in trouble has called him,” said Alice Schroeder, author of “The Snowball: Warren Buffett and the Business of Life,” a biography released last week by Bantam. Ms. Schroeder, a former Wall Street analyst, is the first Buffett biographer to receive his cooperation, and she said she talked to him regularly.
The companies benefit from the credibility dividend that comes with the Buffett endorsement. Last Thursday, the day after he announced his investment in G.E., the company raised more than $12 billion in a public sale of shares.
Mr. Buffett is also the largest shareholder in Wells Fargo, which last Friday swept in with a $15 billion bid for another banking company, Wachovia, offering seven times what Citigroup did at the start of the week.
Mr. Buffett is the world’s richest person, topping this year’s ranking of billionaires by Forbes magazine with $62 billion. Mr. Buffett has pledged to give most of that fortune to charity upon his death.
Yet even more than money, Mr. Buffett brings the reputational capital that comes from being a peerless long-term investor, revered for his acumen and sound judgment.
“So there is immense signaling power to Buffett’s moves, showing others that now may be a good time to invest,” Mr. Bruner said.
Morgan wielded his power over the financial markets more directly than Mr. Buffett, though his personal wealth lagged the early 20th century industrial titans John D. Rockefeller and Andrew Carnegie.
In 1907, the United States had no central bank. The financial crisis began that year because trust companies handling wills and estates — firms long synonymous with safe investment — exploited legal loopholes and became wild speculators in the stock market. When those investments soured, the collapse of the trusts threatened the financial system.
Morgan stepped in and functioned as America’s central bank. The United States Treasury handed him $25 million (more than $550 million today) with the blessing of President Theodore Roosevelt — who was not a natural Morgan ally, given his aversion for big business and its leaders, memorably deriding them as “malefactors of great wealth.”
But those were dire economic times. Morgan gathered his fellow financiers at his Manhattan mansion and hammered out a rescue plan. After a few rocky weeks, the panic subsided.
“In 1907, Morgan was not only committing some of his own money but also organizing the entire financial community to join in the rescue,” said Ron Chernow, a business historian and the author of “The House of Morgan” (Atlantic Monthly Press, 1990).
Indeed, Mr. Chernow said, one motivation for creating the Federal Reserve in 1913 was that Morgan would not be around forever. Morgan died that same year.
Morgan also used the power of his personality and public statements to try to sway market behavior and psychology. In the current crisis, when authorities became concerned that short-sellers were accelerating the stock-market swoon, the Securities and Exchange Commission issued a legal order prohibiting short-selling in the shares of roughly 800 companies.
In 1907, financial policies were less formal. Morgan simply stated that short-sellers, who bet that a company’s share price would drop, “shall be properly attended to,” said John Steele Gordon, a business historian and author.
His words were to be taken as an implied threat, and a reminder that he was watching. “Nobody wanted to find out what that might mean,” Mr. Gordon explained. “In Morgan’s day, the world was so much smaller, and Morgan was so powerful.”
The estimated $44 billion in cash that Mr. Buffett’s company, Berkshire Hathaway, has on hand is a modest sum compared with the vast size of today’s financial markets. So he can make selective investments but not turn things single-handedly.
At a time when government looms so much larger in the economy than it did a century ago, Mr. Buffett, unlike Morgan, is not directly involved in the current rescue. Yet Mr. Buffett has said that the government has asked for his advice, and he knows and admires the architect of the rescue package, Treasury Secretary Henry M. Paulson Jr.
Mr. Buffett, according to Ms. Schroeder, has over the years become more comfortable and more committed to speaking out on public issues. “It’s not lost on him that people trust him more than they trust politicians,” she said.
Mr. Buffett still speaks to the press only occasionally, and he declined to be interviewed for this article. But after the House of Representatives rejected the rescue plan last Monday, Mr. Buffett got a call from Charlie Rose, the television interviewer, who has known Mr. Buffett for years. He urged Mr. Buffett to appear on his PBS interview show as soon as possible.
“I told him, ‘You have to do this,’ ” Mr. Rose recalled in an interview on Saturday. “ ‘No one has your credibility, and people want to hear what you have to say.’ ”
Mr. Buffett agreed to do it, and Mr. Rose flew to San Diego, where Mr. Buffett would be on Wednesday. The hourlong interview on Wednesday night was vintage Warren Buffett: calm, plain-spoken and wry.
He called the current crisis an economic Pearl Harbor, requiring immediate action. Its biggest single cause, he explained, was the real estate bubble. “Three hundred million Americans, their lending institutions, their government, their media, all believed that house prices were going to go up consistently,” he said. “Lending was done based on it, and everybody did a lot of foolish things.”
As far back as 2003, Mr. Buffett had warned that the complex securities at the center of today’s troubles — once so profitable, but now toxic — were “financial weapons of mass destruction.” These securities were engineered by the math quants on Wall Street, and in the interview Mr. Buffett expressed his disdain: “Beware of geeks bearing formulas.”
To help pay for the rescue, the government should raise taxes on the wealthy, Mr. Buffett suggested. “I’m paying the lowest tax rate that I’ve ever paid in my life,” he said. “Now, that’s crazy.”
On Friday, after public sentiment shifted, the House passed the financial rescue package. But the markets are still weak, and it remains to be seen whether Mr. Buffett’s recent investments will prove to be wise ones.
“It’s a high-risk moment, and I think he may have ventured into the waters prematurely,” said Mr. Chernow, the historian. “But Warren Buffett is worth many billions of dollars, and I am assuredly not.”

Charlie Rose

Doris Kearns Goodwin had the best analysis of McCain's speech.

Events will determine the outcome. By November we will have had the dreaded month of October and the coming cxxxx, (unless the Fed takes over Fannie and Freddie).

As we prepare to go to bed, Asia is down over 2%. Every day, every day.

In the meantime Chaney digs our hole deeper in Georgia and the UN. We pledge another billion to Georgia.

Charlie Rose = Good Last Night

So I Googled Nicholson Baker in the NYT:


Books
All NYT
new_york_times:http://www.nytimes.com/2008/03/23/books/review/Toibin-t.html

By COLM TOIBIN
Published: March 23, 2008
In 1960, after his essay on the Democratic National Convention had appeared — written in his customary flamboyant style — Norman Mailer received a letter from Jacqueline Kennedy, who wondered if the “impressionistic” way in which he had treated the convention could be applied to the writing of history.
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Olivier Kugler
HUMAN SMOKE
The Beginnings of World War II, the End of Civilization.
By Nicholson Baker.
565 pp. Simon & Schuster. $30.
Related
First Chapter: ‘Human Smoke’ (March 23, 2008)
A Debunker on the Road to World War II (March 4, 2008)
'Human Smoke,' by Nicholson Baker : Say What? It Wasn’t a Just War After All? (March 12, 2008)
Up Front (March 23, 2008)
Times Topics: Nicholson Baker
Paper Cuts Blog: Gone to Deletopedia (March 8, 2008)
Enlarge This Image
Olivier Kugler

The novelist Nicholson Baker’s customary style in books like “The Mezzanine” and “Room Temperature” is to observe the world in slow, painstaking detail, relishing the tiny moment, enjoying the aside for the sake of accuracy, insisting on charting the precise state of things. He has now applied this system to history, to the few years before the United States declared war on Japan and entered into World War II as a full participant. It is clear Baker has not done this as a literary exercise, nor as a new way of amusing himself and his readers, but because of a passionate view of how the war against Germany was conducted by Britain under Winston Churchill.
There is, it seems at first, a sort of madness in his method. He does not offer a straightforward narrative as a historian or a polemicist might do, but instead his book is made up of a set of vignettes, each containing a fact or a quotation from one of the main participants, or from someone who kept a diary. Most vignettes carry a date. Sometimes these entries come three to a page, sometimes they are slightly longer. Slowly, as you read, because of the variety in the tone and the shocking or tragic nature of the quotation, and because of how well chosen they are, “Human Smoke: The Beginnings of World War II, the End of Civilization” becomes riveting and fascinating. It is as though a brilliant film editor, with an urgent argument to make, began to work with gripping newsreels.
The main figures in the book are Churchill and Franklin Roosevelt; members of the pacifist movement including Gandhi; Hitler and his entourage; and diarists like Victor Klemperer in Dresden and Mihail Sebastian in Bucharest. But sometimes it is the simple stark fact that makes you sit up straight for a moment, like this one from early in the book: “The Royal Air Force dropped more than 150 tons of bombs on India. It was 1925.” This, coming soon after an account of the proposed bombing of civilian targets in Iraq in 1920 (with Churchill writing: “I am strongly in favor of using poisoned gas against uncivilized tribes”), sets a theme for the book, which Baker will skillfully weave into the fabric of events mainly between 1920 and 1942 — that the bombing of villages and cities from the air represents “the end of civilization.”
Baker is adept at managing the reader’s emotion. His vignettes about the treatment of the Jewish population, the deportations and the planned mass murders, are just as carefully chosen, with the same amount of barely contained anger in them as his pieces about what was done to the civilians of Germany and to the civilians of Britain by bombers. It seems that he wishes to stir up an argument as much as settle one. In his afterword he says of the pacifists: “They failed, but they were right.” It is an aspect of the subtlety of his book that the reader is entitled to wonder if it’s true.
Churchill emerges here as a most fascinating figure — impetuous, childish, bloodthirsty, fearless, insomniac, bookish, bullying, determined, to name just some of his characteristics. Baker writes: “He wasn’t an alcoholic, someone said later — no alcoholic could drink that much.” The prime minister of Australia noted of Churchill: “In every conversation he ultimately reaches a point where he positively enjoys the war.” After the bombing of British cities Baker quotes him: “This ordeal by fire has, in a certain sense, even exhilarated the manhood and the womanhood of Britain.”
“One of our great aims,” Churchill wrote in July 1941, “is the delivery on German towns of the largest possible quantity of bombs per night.” Soon afterward, he said publicly: “It is time that the Germans should be made to suffer in their own homeland and cities something of the torments they have let loose upon their neighbors and upon the world.” Baker quotes large numbers of people who seemed to feel in these years that the entire German population, including women and children, were to blame for the Nazis and should be punished accordingly. For example, the writer Gerald Brenan: “Every German woman and child killed is a contribution to the future safety and happiness of Europe.” Or David Garnett (the author of the novel “Aspects of Love,” on which the musical is based), who wrote in 1941: “By butchering the German population indiscriminately it might be possible to goad them into a desperate rising in which every member of the Nazi Party would have his throat cut.”
The problem, as Baker makes clear, was that the bombing served to kill and maim the civilian population, yet the survivors did not blame the Nazi leaders, who used the bombing as a further excuse to inflict suffering on the Jewish population, claiming, for example, that evictions of Jews were “justified on the grounds that Aryans whose houses were destroyed by bombing needed a place to live.” As early as 1941 a member of Churchill’s cabinet could write: “Bombing does NOT affect German morale: let’s get that into our heads and not waste our bombers on these raids.” Churchill’s rationale for the bombing, Baker writes, arose from his belief that it was “a form of pedagogy — a way of enlightening city dwellers as to the hellishness of remote battlefields by killing them.”
In April 1941 certain German cities were identified as good targets because they were “congested industrial towns, where the psychological effect will be greatest”; the same report recommended the use of delayed-action bombs “so as to prevent or seriously interfere with fire fighting, repair and general traffic organization.” The following month Lord Trenchard, who had been instrumental in establishing the Royal Air Force, admitted that “the percentage of bombs which hit the military target at which they are aimed is not more than 1 percent.” And when Baker turns his attention to Washington, which he does regularly, he offers vignettes to suggest that Roosevelt was busy goading the Japanese to bomb Pearl Harbor so that America could enter the war.
Baker knows he is preaching to readers who already believe that the Nazis were evil, and that the German war machine, including the blitz, was, to say the least, conducted with ruthless carelessness for human life, and that many ordinary Germans were implicated in the Holocaust. It is possible that “Human Smoke” will infuriate those who believe that Churchill was a hero and that war, in all its viciousness, is often the only way to defeat those who declare or threaten war. “Human Smoke” will not be admired by those who argue that methods used to win a war may seem, especially to novelists writing more than 60 years later, impossible to justify. Nonetheless, the issues Baker wishes to raise, and the stark system he has used to dramatize his point, make his book a serious and conscientious contribution to the debate about pacifism. He has produced an eloquent and passionate assault on the idea that the deliberate targeting of civilians can ever be justified.
Colm Toibin’s most recent book is a collection of stories, “Mothers and Sons.”

Charlie Rose Last Night

Excellent. Just played it back this morning for Slingbox in case Genny, in Manilla, is watching, exactly 12 hours' ahead. Half on the Obama victory; half on Iraq and an author who spent five years there.