This week, Today host Savannah Guthrie noted New York Mayor Michael Bloomberg’s opinion that it was “pure fantasy” to think the GOP tax bill would lead to growth in jobs and wages. Guthrie said to House Speaker Paul Ryan: “I’ll ask you plainly: Are you living in a fantasy world?”
Ryan sputtered out an answer that was quickly lost to the aether, but the real answer’s obvious: Yes, Savannah, the GOP is living in a fantasy world. Specifically, a science fantasy world, one a lot of us have indulged in this holiday season. The GOP believes that it’s in Ryan’s beloved Star Wars, it’s Han Solo, and it’s about to win the Millennium Falcon from Lando Calrissian.
Lando was holding two cards in his hand now. The professional gambler smiled at his friend, then, quickly punching a notation onto a data-card, he pushed it and his few remaining credit-chips toward Han. “My marker,” he said, in his smoothest, most mellow tones. “Good for any ship on my lot. Your choice of my stock.”
The Bith turned to Han. “Is that acceptable to you, Solo?”
Han’s mouth was so dry he didn’t dare speak, but he nodded.
The Bith turned back to Lando. “Your marker is good.”
Lando, who won the Falcon two years earlier at this tournament, bluffed Solo with an Idiot and a Two of Staves against Solo’s Pure Sabacc, which could only be beaten by Lando having the Three of Staves to fill out the Idiot’s Array but—okay, I probably lost you. As I’ve run Sabacc tournaments at Star Wars Celebration, I’m one of the few earthlings who knows how to play Sabacc, which is kind of like being crowned Most Valuable Seeker of your town’s Quidditch league. Yeah, maybe I should just talk about poker.
There are two ways to handle the question of how much a poker player can bet. The first is called “table stakes.” This means that all players can bet only with money they have on the table. So if a player has $500 in chips, he can only bet $500. But what if someone bets $1,000 to that player? Is he out of the hand because he can’t pay enough to call? Not hardly. He can go “all in,” meaning that he answers the $1,000 bet with a $500 call that amounts to all his chips. If the player loses, he loses his $500, and is likely out of the game. If the player wins, he wins $500 from the player who put him all in.
The key to this, of course, is that regardless of how recklessly a player plays, he cannot lose more than he has staked in the game. If he doesn’t play the hand, he’s not at risk at all. And in a poker tournament, the key to success is not playing too many hands, especially with cards that only win occasionally. While other players bankrupt themselves on bad bets, the conservative player retains his stack of chips for when the cards give better odds of success.
That’s one way to run an economy, and it’s a highly advisable way. At the end of a year, every law-abiding American files a tax return that delineates how much he or she is contributing to the federal government’s treasury. In a table stakes economy, that’s how much the government can spend for the next year. The government then makes hard choices about what it will spend its money on, based on the money it has to play with. Some hands it will have to sit out. Turns out we’re not exactly playing table stakes, though. We have a thing called a debt ceiling, which limits how much the government can borrow. Its goal is to make us stay within our means. It doesn’t quite do that.
I said there were two ways to answer the question of how much a player can bet, the first being table stakes. The second is called “out of pocket,” the much more dangerous way to play poker. In an out of pocket game, any player can bet any amount greater than the number of chips he has. He can reach into his pocket for more money to back up whatever he has already put into the hand. In the movies, this is when the keys to the Aston Martin hit the felt.
Pulling money out of one’s pocket and trading it for chips takes time, however, so in this kind of game, a player may “drag light,” or pull chips out of the pot equal to the amount that he will exceed his stack. Should the player win, his debt to the pot is erased. Should he lose, the light chips represent that player’s further obligation to the winner of the pot. This usually needs to be produced at once, though sometimes an IOU can be written to cover the light stack.
You can see how tempting this would be. With this option available, you might play a lot more hands, and you might not be inclined to fold a hand when losing it would cost you everything in front of you. You can always borrow from the future by reaching into your pocket. That’s why poker has its limits. A betting limit is a minimum or maximum amount you can bet at any time. For example, you might play a $1-$2 Hold ’Em game. That means that the minimum bet on any opportunity is a dollar, and the maximum is twice that. But some people don’t like limits, so they play no-limit, meaning there aren’t any betting maximums, so anyone can bet any amount he can cover.
It’s that last bit that’s the problem. Search all you like in the public card rooms of Las Vegas, but you will be hard-pressed to find a no-limit Hold ’Em game that allows players to play out of pocket. You will find out-of-pocket games, and you will find no-limit games, but almost never the two together. That’s because the ability to reach into one’s pocket to cover a bet that’s uncapped in its maximum size means that anyone with a sufficient bankroll can buy any pot. You bet $10, and I raise $1 million. Chances are you can’t cover that, so you must fold. That’s untenable, and it’s not really poker, so it’s not played.
In that Casino Royale scene, the dealer tries to insist the criminal and James Bond play by table stakes, but Bond allows the criminal to bet his car. At least the dealer tries to enforce the rules. The Sabacc dealer doesn’t even try. Despite the tournament being a 10,000-credit table stakes game, the Bith says Lando’s marker for an unspecified ship on his lot is good, if it’s cool with Han. That’s crossing the streams, and it’s madness.
For most of the 20th century, the federal government understood that you can’t play table stakes and out of pocket together. An expenditure might not have to be covered by the previous year’s taxes, but it had to be covered from somewhere, even if it was borrowing against future revenues. This made choices difficult, and eventually all debts had to be paid. Investments had to be met with the expectations of future incomes. This gave an economic weight to paying for public schools, since an educated workforce makes more money down the road. Some administrations spent more on defense and less on social programs, and some did the opposite, because choices had to be made.
Until September 10, 2001, the US was playing reasonably conservatively. The budget was running a surplus under President Clinton. We were starting, ever so slowly, to eat into the national debt. The nightmare of September 11 set all that ablaze. We hit a recession, began the cleanup, and mobilized against the Taliban. It wasn’t cheap, but it was within America’s budget — at least, one with a few credit cards.
Since then, though, the “Party of Fiscal Responsibility” has gone bonkers with spending—they’ve been “on tilt,” as the poker players say.
The Bush administration racked up insane deficits (especially as the economy crashed in 2008), the Obama administration slowed them down, and now the GOP has passed a bill that adds one and a half trillion dollars—more than $50,000 for every American man, woman, and child—to the national debt. Our so-called president gleefully signed it on his way to Mar-A-Lago, aware that he makes out like a bandit under it.
Like any poker player, we cannot afford this. Even a few hundred billion can be spent down eventually, but one and a half trillion cannot. Eventually the interest we pay on the deficit will overwhelm the budget, and then we will go bankrupt for good. Sometimes, no matter how much you want to win, you have to stand up from the table, or you may not get to play another hand.
Unless, like Star Wars superfan Paul Ryan, you’re living in a fantasy world. Then you might get to be like Han Solo. That Sabacc story concluded with the following eye-melting, mystique-killing paragraph.
Han grinned, then threw both arms up into the air and whirled around in an impromptu dance, giddy with joy. “Wait till I tell Chewie! The Millennium Falcon is mine! At last! A ship of our own!”
Trouble is, I can see Paul Ryan doing just that.
This is the eleventh installment of a series of posts on politics and game theory. The series has covered impeachment, Russian collusion, white supremacy, abortion, guns, nuclear war, the national debt, the NFL, sexual harassment, and the Mueller investigation. These essays are in my book Game Theory in the Age of Chaos, which you can order by clicking the link.