TW: The animal shots will be our only post today. Back tomorrow with some new stuff, thx.
And in case you missed today's Dilbert
Saturday, October 31, 2009
Saturday's Animal Shots
TW: The animal shots will be our only post today. Back tomorrow with some new stuff, thx.
And in case you missed today's Dilbert
Friday, October 30, 2009
Stewart Is On the Case
| The Daily Show With Jon Stewart | Mon - Thurs 11p / 10c | |||
| ||||
TW: Have been going lite on Stewart recently but that only makes its that much better when we feature another classic.
For instance, I love Cal Thomas truly one of the biggest douche bags ever and has been for the twenty years at least I have seen him defile our media.
I repeat myself but I respect Fox's business model of creating a resounding and reassuring echo chamber for a certain minority of Americans. My only beefs with Fox are when I see allegedly intelligent innocents treating as something different (i.e. an actual news organization attempting to be relatively unbiased). Or when some asshole at my health club turns it on in front of me within my range of vision...that aggravates the shit out of me and has risked violent confrontation.
Pondering the Implications Of One's Acts
From David Frum at New Majority:
"...This was the right thing to do, but it cannot have been easy - especially as he is making the decision that may lead to more such sad homecomings"
TW: From the comment thread to Frum's post:
balconesfault // Oct 29, 2009 at 10:35 am
Respectfully, no political talk on this thread.
2 sek // Oct 29, 2009 at 10:36 am
I certainly have no problem at all with President Obama visiting Dover or with families of fallen soldiers. I think that is a solemn duty of any Commander in Chief. But I don’t like it when the President (of either party) turns it into a photo op. I think that’s disrespectful.
3 ottovbvs // Oct 29, 2009 at 10:38 am
……..It was the right thing to do………who knows maybe he saw it part of the decision making process……..there’s a world of difference between sitting in Washington conference rooms with smart lawyers and military brass discussing theoreticals and dealing with the reality of coffins which are bringing grief to so many ordinary American homes.
4 LauraNo // Oct 29, 2009 at 10:39 am
I bet this meant a lot to the families. I hope he does it every once in a while. Presidents should have to face the awful results, not just the families, showing respect at the same time.
6 demosthenes // Oct 29, 2009 at 1:12 pm
Like most Americans, regardless of political party, I applaud the president for doing this. I understand the angst among some that photographs were taken, but honoring our heroes is what matters! Bravo, Mr. President!
7 andydp // Oct 29, 2009 at 1:26 pm
This was more meaningful to me as a Soldier.
Gerneral George Patton insisted his staff officers visited the front daily to insure they realized what their decisions really meant.
8 seeker656 // Oct 29, 2009 at 1:49 pm
Thank you for this video David. As the grandfather of two young men who will very likely be in Afghanistan next year, I respect and honor the families of these fallen heroes. I am grateful for the decision of the family that allowed this video of this emotionally painful moment to be shared.
It is important that the President experienced this event and listened to the families who were present last night as he considers the options for the future of this conflict.
11 mi-goper // Oct 29, 2009 at 5:47 pm
David, as a Marine and father of 3, I can tell you that I don’t agree with your sentiments nor your willingness to cut Obama any slack –especially with this ploy.
His presence at Dover was a calculated political manipulation to gain some momentum and credibility back with Americans because, rightly so, he’s been portrayed of late as dithering on this important decision. Dithering, many think, because he’s in hot water with his Far Left Cut & Run Democrat Kamp on escalating the war, agreeing and implementing the Cheney Plan for Afghanistan… a heresy that, when disclosed, caused his far Left flank to start nipping at his loins.
The man is a consumate actor and fake. He can look you in the eye, over the teleprompter, and tell you –with a straight face– that a public option will bring competition to the health insurance markets when its will drive free markets out. He can tell you his reform won’t require new taxes –even though they do–it won’t require cuts in services –even as he gets the OMB scissors out to whack MediCare by $500b– it won’t force you to change medical care plans –even though he’s counting on employers dropping millions of covered employees and dumping them into the public plan.
Afterall, this is the man who ran on not much more than “Hope & Change” and he’s been personally responsible for making Washington more intractable, more partisan, more divisive with his attack-dog, Chicago Thuggery attacks on anyone who dares to disagree with the Messiah Obama.
You may be willing to act naive in the face of Obama’s latest political maneuver to curry favor with a public that’s losing confidence in his role as Commander in Chief, but his moves in Dover were intended to use those flag-draped coffins as chits in his public relations effort to downscale America’s commitment to the people of Afghanistan. He doesn’t care about the dead soldiers. He cares about getting out of Afghanistan as quickly and efficiently as possible and he’s worried that if his far Left flank gets unsettled, he’s toast. Of course, his publicity stunt caters to the pro-war crowd too because, for a man who wouldn’t wear a flag pin or put his hand over his heart to say the Pledge, this stunt makes them question whether he’s truly the anti-military Democrat he was on the campaign trail.
And he’s willing to use these brave, dead soldiers as props in his Theatre of the Absurd.
Shame on you for giving him cover, David.
12 arch // Oct 29, 2009 at 5:59 pm
I don’t believe the man is a fake. I think he’s a liberal, wanna-be transformational politician with whom I don’t agree on everything. But acknowledging our fallen is important to the families and important to the country. It may seem like a no brainer, but I still applaud the President for this.
13 ottovbvs // Oct 29, 2009 at 6:38 pm
mi-goper // Oct 29, 2009 at 5:47 pm
…….Have you no self control?"
"...This was the right thing to do, but it cannot have been easy - especially as he is making the decision that may lead to more such sad homecomings"
TW: From the comment thread to Frum's post:
balconesfault // Oct 29, 2009 at 10:35 am
Respectfully, no political talk on this thread.
2 sek // Oct 29, 2009 at 10:36 am
I certainly have no problem at all with President Obama visiting Dover or with families of fallen soldiers. I think that is a solemn duty of any Commander in Chief. But I don’t like it when the President (of either party) turns it into a photo op. I think that’s disrespectful.
3 ottovbvs // Oct 29, 2009 at 10:38 am
……..It was the right thing to do………who knows maybe he saw it part of the decision making process……..there’s a world of difference between sitting in Washington conference rooms with smart lawyers and military brass discussing theoreticals and dealing with the reality of coffins which are bringing grief to so many ordinary American homes.
4 LauraNo // Oct 29, 2009 at 10:39 am
I bet this meant a lot to the families. I hope he does it every once in a while. Presidents should have to face the awful results, not just the families, showing respect at the same time.
6 demosthenes // Oct 29, 2009 at 1:12 pm
Like most Americans, regardless of political party, I applaud the president for doing this. I understand the angst among some that photographs were taken, but honoring our heroes is what matters! Bravo, Mr. President!
7 andydp // Oct 29, 2009 at 1:26 pm
This was more meaningful to me as a Soldier.
Gerneral George Patton insisted his staff officers visited the front daily to insure they realized what their decisions really meant.
8 seeker656 // Oct 29, 2009 at 1:49 pm
Thank you for this video David. As the grandfather of two young men who will very likely be in Afghanistan next year, I respect and honor the families of these fallen heroes. I am grateful for the decision of the family that allowed this video of this emotionally painful moment to be shared.
It is important that the President experienced this event and listened to the families who were present last night as he considers the options for the future of this conflict.
11 mi-goper // Oct 29, 2009 at 5:47 pm
David, as a Marine and father of 3, I can tell you that I don’t agree with your sentiments nor your willingness to cut Obama any slack –especially with this ploy.
His presence at Dover was a calculated political manipulation to gain some momentum and credibility back with Americans because, rightly so, he’s been portrayed of late as dithering on this important decision. Dithering, many think, because he’s in hot water with his Far Left Cut & Run Democrat Kamp on escalating the war, agreeing and implementing the Cheney Plan for Afghanistan… a heresy that, when disclosed, caused his far Left flank to start nipping at his loins.
The man is a consumate actor and fake. He can look you in the eye, over the teleprompter, and tell you –with a straight face– that a public option will bring competition to the health insurance markets when its will drive free markets out. He can tell you his reform won’t require new taxes –even though they do–it won’t require cuts in services –even as he gets the OMB scissors out to whack MediCare by $500b– it won’t force you to change medical care plans –even though he’s counting on employers dropping millions of covered employees and dumping them into the public plan.
Afterall, this is the man who ran on not much more than “Hope & Change” and he’s been personally responsible for making Washington more intractable, more partisan, more divisive with his attack-dog, Chicago Thuggery attacks on anyone who dares to disagree with the Messiah Obama.
You may be willing to act naive in the face of Obama’s latest political maneuver to curry favor with a public that’s losing confidence in his role as Commander in Chief, but his moves in Dover were intended to use those flag-draped coffins as chits in his public relations effort to downscale America’s commitment to the people of Afghanistan. He doesn’t care about the dead soldiers. He cares about getting out of Afghanistan as quickly and efficiently as possible and he’s worried that if his far Left flank gets unsettled, he’s toast. Of course, his publicity stunt caters to the pro-war crowd too because, for a man who wouldn’t wear a flag pin or put his hand over his heart to say the Pledge, this stunt makes them question whether he’s truly the anti-military Democrat he was on the campaign trail.
And he’s willing to use these brave, dead soldiers as props in his Theatre of the Absurd.
Shame on you for giving him cover, David.
12 arch // Oct 29, 2009 at 5:59 pm
I don’t believe the man is a fake. I think he’s a liberal, wanna-be transformational politician with whom I don’t agree on everything. But acknowledging our fallen is important to the families and important to the country. It may seem like a no brainer, but I still applaud the President for this.
13 ottovbvs // Oct 29, 2009 at 6:38 pm
mi-goper // Oct 29, 2009 at 5:47 pm
…….Have you no self control?"
Things I Like - Sciences
LOVED this! Saw it first at the Sagan Appreciation Society page on YouTube:
[deGrasse Tyson]
"We are all connected;
To each other, biologically
To the earth, chemically
To the rest of the universe atomically
[Feynman]
I think nature's imagination
Is so much greater than man's
She's never going to let us relax
[Sagan]
We live in an in-between universe
Where things change all right
But according to patterns, rules,
Or as we call them, laws of nature
[Nye]
I'm this guy standing on a planet
Really I'm just a speck
Compared with a star, the planet is just another speck
To think about all of this
To think about the vast emptiness of space
There's billions and billions of stars
Billions and billions of specks
[Sagan]
The beauty of a living thing is not the atoms that go into it
But the way those atoms are put together
The cosmos is also within us
We're made of star stuff
We are a way for the cosmos to know itself
Across the sea of space
The stars are other suns
We have traveled this way before
And there is much to be learned
I find it elevating and exhilarating
To discover that we live in a universe
Which permits the evolution of molecular machines
As intricate and subtle as we
[deGrasse Tyson]
I know that the molecules in my body are traceable
To phenomena in the cosmos
That makes me want to grab people in the street
And say, have you heard this??
(Richard Feynman on hand drums and chanting)
[Feynman]
There's this tremendous mess
Of waves all over in space
Which is the light bouncing around the room
And going from one thing to the other
And it's all really there
But you gotta stop and think about it
About the complexity to really get the pleasure
And it's all really there
The inconceivable nature of nature"
Feynman on the drums...doesn't get much better.
btw - Happy Birthday a day early to Leslie who refuses to join the 21st century and have a computer at home...
"We Are All Connected" was made from sampling Carl Sagan's Cosmos, The History Channel's Universe series, Richard Feynman's 1983 interviews, Neil deGrasse Tyson's cosmic sermon, and Bill Nye's Eyes of Nye Series, plus added visuals from The Elegant Universe (NOVA), Stephen Hawking's Universe, Cosmos, the Powers of 10, and more. It is a tribute to great minds of science, intended to spread scientific knowledge and philosophy through the medium of music.Lyrics:
[deGrasse Tyson]
"We are all connected;
To each other, biologically
To the earth, chemically
To the rest of the universe atomically
[Feynman]
I think nature's imagination
Is so much greater than man's
She's never going to let us relax
[Sagan]
We live in an in-between universe
Where things change all right
But according to patterns, rules,
Or as we call them, laws of nature
[Nye]
I'm this guy standing on a planet
Really I'm just a speck
Compared with a star, the planet is just another speck
To think about all of this
To think about the vast emptiness of space
There's billions and billions of stars
Billions and billions of specks
[Sagan]
The beauty of a living thing is not the atoms that go into it
But the way those atoms are put together
The cosmos is also within us
We're made of star stuff
We are a way for the cosmos to know itself
Across the sea of space
The stars are other suns
We have traveled this way before
And there is much to be learned
I find it elevating and exhilarating
To discover that we live in a universe
Which permits the evolution of molecular machines
As intricate and subtle as we
[deGrasse Tyson]
I know that the molecules in my body are traceable
To phenomena in the cosmos
That makes me want to grab people in the street
And say, have you heard this??
(Richard Feynman on hand drums and chanting)
[Feynman]
There's this tremendous mess
Of waves all over in space
Which is the light bouncing around the room
And going from one thing to the other
And it's all really there
But you gotta stop and think about it
About the complexity to really get the pleasure
And it's all really there
The inconceivable nature of nature"
Feynman on the drums...doesn't get much better.
btw - Happy Birthday a day early to Leslie who refuses to join the 21st century and have a computer at home...
Yes AfPak IS Hard
TW: Friedman's column could be summed up as: "AfPak is hard and we are not good at fixing things anyway". I concur with both sentiments. But he also goes on to imply Iraq matters more than AfPak and that we can risk a conflagration in AfPak after our departure. This is dangerously wrong-headed. I have no idea where he is headed with the Iraq story unless he still harbors dreams of some Jeffersonian democracy emerging in that tribally riven nation.
As for AfPak, we have been there for eight years, no one would claim it is easy. Some perhaps thought we would waltz in with a bunch of precision weaponry and a few thousand advisers and things would work out, but those pipe dreams are long gone. Yet few would claim it is not a pivotal region. If Friedman is right and it is not a pivotal region, then yes we should get the hell out. But I believe is very wrong. I have stated my case previously here. Just because it is hard does not make it the wrong place to be.
From Tom Friedman at NYT:
"It is crunch time on Afghanistan, so here’s my vote: We need to be thinking about how to reduce our footprint and our goals there in a responsible way, not dig in deeper. We simply do not have the Afghan partners, the NATO allies, the domestic support, the financial resources or the national interests to justify an enlarged and prolonged nation-building effort in Afghanistan.
I base this conclusion on three principles. First, when I think back on all the moments of progress in that part of the world — all the times when a key player in the Middle East actually did something that put a smile on my face — all of them have one thing in common: America had nothing to do with it.
America helped build out what they started, but the breakthrough didn’t start with us. We can fan the flames, but the parties themselves have to light the fires of moderation. And whenever we try to do it for them, whenever we want it more than they do, we fail and they languish.
The Camp David peace treaty was not initiated by Jimmy Carter. Rather, the Egyptian president, Anwar Sadat, went to Jerusalem in 1977 after Israel’s Moshe Dayan held secret talks in Morocco with Sadat aide Hassan Tuhami. Both countries decided that they wanted a separate peace — outside of the Geneva comprehensive framework pushed by Mr. Carter...
The message: “People do not change when we tell them they should,” said the Johns Hopkins University foreign policy expert Michael Mandelbaum. “They change when they tell themselves they must.”
And when the moderate silent majorities take ownership of their own futures, we win. When they won’t, when we want them to compromise more than they do, we lose. The locals sense they have us over a barrel, so they exploit our naïve goodwill and presence to loot their countries and to defeat their internal foes.
That’s how I see Afghanistan today. I see no moderate spark. I see our secretary of state pleading with President Hamid Karzai to re-do an election that he blatantly stole. I also see us begging Israelis to stop building more crazy settlements or Palestinians to come to negotiations. It is time to stop subsidizing their nonsense. Let them all start paying retail for their extremism, not wholesale. Then you’ll see movement.
What if we shrink our presence in Afghanistan? Won’t Al Qaeda return, the Taliban be energized and Pakistan collapse? Maybe. Maybe not. This gets to my second principle: In the Middle East, all politics — everything that matters — happens the morning after the morning after. Be patient. Yes, the morning after we shrink down in Afghanistan, the Taliban will celebrate, Pakistan will quake and bin Laden will issue an exultant video.
And the morning after the morning after, the Taliban factions will start fighting each other, the Pakistani Army will have to destroy their Taliban, or be destroyed by them, Afghanistan’s warlords will carve up the country, and, if bin Laden comes out of his cave, he’ll get zapped by a drone.
My last guiding principle: We are the world. A strong, healthy and self-confident America is what holds the world together and on a decent path. A weak America would be a disaster for us and the world. China, Russia and Al Qaeda all love the idea of America doing a long, slow bleed in Afghanistan. I don’t.
The U.S. military has given its assessment. It said that stabilizing Afghanistan and removing it as a threat requires rebuilding that whole country. Unfortunately, that is a 20-year project at best, and we can’t afford it. So our political leadership needs to insist on a strategy that will get the most security for less money and less presence. We simply don’t have the surplus we had when we started the war on terrorism after 9/11 — and we desperately need nation-building at home. We have to be smarter. Let’s finish Iraq, because a decent outcome there really could positively impact the whole Arab-Muslim world, and limit our exposure elsewhere. Iraq matters.
Yes, shrinking down in Afghanistan will create new threats, but expanding there will, too. I’d rather deal with the new threats with a stronger America."
http://www.nytimes.com/2009/10/28/opinion/28friedman.html?_r=1&hp
As for AfPak, we have been there for eight years, no one would claim it is easy. Some perhaps thought we would waltz in with a bunch of precision weaponry and a few thousand advisers and things would work out, but those pipe dreams are long gone. Yet few would claim it is not a pivotal region. If Friedman is right and it is not a pivotal region, then yes we should get the hell out. But I believe is very wrong. I have stated my case previously here. Just because it is hard does not make it the wrong place to be.
From Tom Friedman at NYT:
"It is crunch time on Afghanistan, so here’s my vote: We need to be thinking about how to reduce our footprint and our goals there in a responsible way, not dig in deeper. We simply do not have the Afghan partners, the NATO allies, the domestic support, the financial resources or the national interests to justify an enlarged and prolonged nation-building effort in Afghanistan.
I base this conclusion on three principles. First, when I think back on all the moments of progress in that part of the world — all the times when a key player in the Middle East actually did something that put a smile on my face — all of them have one thing in common: America had nothing to do with it.
America helped build out what they started, but the breakthrough didn’t start with us. We can fan the flames, but the parties themselves have to light the fires of moderation. And whenever we try to do it for them, whenever we want it more than they do, we fail and they languish.
The Camp David peace treaty was not initiated by Jimmy Carter. Rather, the Egyptian president, Anwar Sadat, went to Jerusalem in 1977 after Israel’s Moshe Dayan held secret talks in Morocco with Sadat aide Hassan Tuhami. Both countries decided that they wanted a separate peace — outside of the Geneva comprehensive framework pushed by Mr. Carter...
The message: “People do not change when we tell them they should,” said the Johns Hopkins University foreign policy expert Michael Mandelbaum. “They change when they tell themselves they must.”
And when the moderate silent majorities take ownership of their own futures, we win. When they won’t, when we want them to compromise more than they do, we lose. The locals sense they have us over a barrel, so they exploit our naïve goodwill and presence to loot their countries and to defeat their internal foes.
That’s how I see Afghanistan today. I see no moderate spark. I see our secretary of state pleading with President Hamid Karzai to re-do an election that he blatantly stole. I also see us begging Israelis to stop building more crazy settlements or Palestinians to come to negotiations. It is time to stop subsidizing their nonsense. Let them all start paying retail for their extremism, not wholesale. Then you’ll see movement.
What if we shrink our presence in Afghanistan? Won’t Al Qaeda return, the Taliban be energized and Pakistan collapse? Maybe. Maybe not. This gets to my second principle: In the Middle East, all politics — everything that matters — happens the morning after the morning after. Be patient. Yes, the morning after we shrink down in Afghanistan, the Taliban will celebrate, Pakistan will quake and bin Laden will issue an exultant video.
And the morning after the morning after, the Taliban factions will start fighting each other, the Pakistani Army will have to destroy their Taliban, or be destroyed by them, Afghanistan’s warlords will carve up the country, and, if bin Laden comes out of his cave, he’ll get zapped by a drone.
My last guiding principle: We are the world. A strong, healthy and self-confident America is what holds the world together and on a decent path. A weak America would be a disaster for us and the world. China, Russia and Al Qaeda all love the idea of America doing a long, slow bleed in Afghanistan. I don’t.
The U.S. military has given its assessment. It said that stabilizing Afghanistan and removing it as a threat requires rebuilding that whole country. Unfortunately, that is a 20-year project at best, and we can’t afford it. So our political leadership needs to insist on a strategy that will get the most security for less money and less presence. We simply don’t have the surplus we had when we started the war on terrorism after 9/11 — and we desperately need nation-building at home. We have to be smarter. Let’s finish Iraq, because a decent outcome there really could positively impact the whole Arab-Muslim world, and limit our exposure elsewhere. Iraq matters.
Yes, shrinking down in Afghanistan will create new threats, but expanding there will, too. I’d rather deal with the new threats with a stronger America."
http://www.nytimes.com/2009/10/28/opinion/28friedman.html?_r=1&hp
Thursday, October 29, 2009
A Successful Launch
TW: This is one of those events which received little notice because it worked. If it had failed (as new rockets frequently do) one would have seen snarky reporting ad nausea. That this was the first time in 30 years that we have launched a new rocket speaks volumes especially since the rocket is in many ways a modified solid rocket booster as used on the Shuttle.
Whether we will actually use this rocket remains to be seen. Ares is meant to become the workhorse U.S. manned space launcher since the Shuttle retires next year. We shall see.
From Chicago Tribune:
"The Ares I-X rocket blasted off Wednesday from Kennedy Space Center in a picture-perfect launch...The entire mission from launch to splashdown took about six minutes and cost $455 million. It was the first time in nearly 30 years that a new rocket took off from Kennedy Space Center. Nearly twice the height of the space shuttle, the experimental rocket carried no passengers or payload...
What is Ares I-X?
It is a test rocket intended to show NASA engineers how a long, thin, solid-fuel rocket flies through the atmosphere. Its first stage is a version of the pencil-like solid-rocket boosters that help power the space shuttle...
Why was it launched?
To see if a single solid-rocket motor can be put directly under a capsule and steered safely as it zooms through the atmosphere. Ares I-X is the first rocket to use a solid-fuel first stage. Previous rockets -- like the shuttle -- used them on the side as boosters to the main liquid-fuel engines.
So why not fly Ares I?
Ares I is not designed yet and will not be ready to fly until March 2015 at the earliest. The idea is to take information gained from this launch to help refine the Ares I design.
...What happens next?
The president's space panel has cast doubt on whether Ares I will be built. Some White House officials say using commercial rockets to fly astronauts to the space station would make Ares I unnecessary."
http://www.chicagotribune.com/news/chi-tc-nw-nasa-1028-1029oct29,0,674711.story
Whether we will actually use this rocket remains to be seen. Ares is meant to become the workhorse U.S. manned space launcher since the Shuttle retires next year. We shall see.
From Chicago Tribune:
"The Ares I-X rocket blasted off Wednesday from Kennedy Space Center in a picture-perfect launch...The entire mission from launch to splashdown took about six minutes and cost $455 million. It was the first time in nearly 30 years that a new rocket took off from Kennedy Space Center. Nearly twice the height of the space shuttle, the experimental rocket carried no passengers or payload...
What is Ares I-X?
It is a test rocket intended to show NASA engineers how a long, thin, solid-fuel rocket flies through the atmosphere. Its first stage is a version of the pencil-like solid-rocket boosters that help power the space shuttle...
Why was it launched?
To see if a single solid-rocket motor can be put directly under a capsule and steered safely as it zooms through the atmosphere. Ares I-X is the first rocket to use a solid-fuel first stage. Previous rockets -- like the shuttle -- used them on the side as boosters to the main liquid-fuel engines.
So why not fly Ares I?
Ares I is not designed yet and will not be ready to fly until March 2015 at the earliest. The idea is to take information gained from this launch to help refine the Ares I design.
...What happens next?
The president's space panel has cast doubt on whether Ares I will be built. Some White House officials say using commercial rockets to fly astronauts to the space station would make Ares I unnecessary."
http://www.chicagotribune.com/news/chi-tc-nw-nasa-1028-1029oct29,0,674711.story
The New New Thing Is What...
TW: will drive economic growth. Perhaps the Tablet described below will be a component of the next bout of economic innovation which feeds economic growth. I believe it may.
I love the IPhone, the "ITablet" to me could be a more robust and larger version of the IPhone. An IPhone the size of a piece of paper. With things like video and data size matters. With constant connection and souped up digital transfer rates, having at one's fingertips streaming video and data in a portable yet handy fashion becomes viable. These are the innovations which make things like the traditional TV set and laptop increasingly obsolete.
Data is becoming universally accessible (one can access live video of just about any sporting event at this point), yet we have remained somewhat tethered to either a set top TV, tiny IPhone or bulky laptop (with shaky connections). Once a well-connected, easily portable device becomes real, folks behaviors will be greatly altered. New industries and firms created.
From Newsweek:
"Apple is supposedly working on a tablet computer.. Rumor has it that the "iTablet"..will be announced in January and released in June...this device may actually warrant the hype. Not because of the tablet itself but because of what it and others like it could do to the way we tell stories. Veteran editor Tina Brown, who now runs The Daily Beast, says we are about to enter "a golden age of journalism."
These devices will play video and music and, of course, display text; they will let you navigate by touching your fingers to the screen; and—this is most important—they will be connected to the Internet at all times. For those of us who carry iPhones, this shift to a persistent Internet has already happened, and it's really profound. The Internet is no longer a destination, someplace you "go to." You don't "get on the Internet." You're always on it. It's just there, like the air you breathe.
Now imagine a larger form factor, with a screen big enough to hold multiple panes of information. It has no lag time and lasts many hours on a battery charge. Here, then, is your new morning newspaper, with videos next to stories and the ability to customize the panes to deliver what you want and leave out what you don't. This device is also your TV, your stereo, and probably your telephone too.
For people like me, who produce content, this change is both great and scary. Great because the techies in Silicon Valley are giving us powerful new tools for telling stories. Scary because the old ways of telling stories are about to become obsolete, and if we cling to them, we'll be washed away. In the past we've all worked in silos. "Print people" had one way of describing the world. "Video people" had another. But the silos are getting crunched together...
The Internet today is a lot like TV circa 1950. But we are about to take an evolution-ary leap. That's why all this hand-wringing over the dying newspaper business is so misplaced. In 10 years the print newspapers we have today will seem as quaint and primitive as those old Uncle Miltie shows. Heck, the Internet we have today will seem quaint and primitive too...
..Look at how people have turned their creativity loose on the iPhone. In just 16 months, thousands of developers have created 85,000 applications for that device. The same will happen with tablets. These powerful devices with constant Internet access will enable us (and force us) to rethink media. What is a newspaper? What is a book? What is a movie? What is entertainment?..."
http://www.newsweek.com/id/217683
I love the IPhone, the "ITablet" to me could be a more robust and larger version of the IPhone. An IPhone the size of a piece of paper. With things like video and data size matters. With constant connection and souped up digital transfer rates, having at one's fingertips streaming video and data in a portable yet handy fashion becomes viable. These are the innovations which make things like the traditional TV set and laptop increasingly obsolete.
Data is becoming universally accessible (one can access live video of just about any sporting event at this point), yet we have remained somewhat tethered to either a set top TV, tiny IPhone or bulky laptop (with shaky connections). Once a well-connected, easily portable device becomes real, folks behaviors will be greatly altered. New industries and firms created.
From Newsweek:
"Apple is supposedly working on a tablet computer.. Rumor has it that the "iTablet"..will be announced in January and released in June...this device may actually warrant the hype. Not because of the tablet itself but because of what it and others like it could do to the way we tell stories. Veteran editor Tina Brown, who now runs The Daily Beast, says we are about to enter "a golden age of journalism."
These devices will play video and music and, of course, display text; they will let you navigate by touching your fingers to the screen; and—this is most important—they will be connected to the Internet at all times. For those of us who carry iPhones, this shift to a persistent Internet has already happened, and it's really profound. The Internet is no longer a destination, someplace you "go to." You don't "get on the Internet." You're always on it. It's just there, like the air you breathe.
Now imagine a larger form factor, with a screen big enough to hold multiple panes of information. It has no lag time and lasts many hours on a battery charge. Here, then, is your new morning newspaper, with videos next to stories and the ability to customize the panes to deliver what you want and leave out what you don't. This device is also your TV, your stereo, and probably your telephone too.
For people like me, who produce content, this change is both great and scary. Great because the techies in Silicon Valley are giving us powerful new tools for telling stories. Scary because the old ways of telling stories are about to become obsolete, and if we cling to them, we'll be washed away. In the past we've all worked in silos. "Print people" had one way of describing the world. "Video people" had another. But the silos are getting crunched together...
The Internet today is a lot like TV circa 1950. But we are about to take an evolution-ary leap. That's why all this hand-wringing over the dying newspaper business is so misplaced. In 10 years the print newspapers we have today will seem as quaint and primitive as those old Uncle Miltie shows. Heck, the Internet we have today will seem quaint and primitive too...
..Look at how people have turned their creativity loose on the iPhone. In just 16 months, thousands of developers have created 85,000 applications for that device. The same will happen with tablets. These powerful devices with constant Internet access will enable us (and force us) to rethink media. What is a newspaper? What is a book? What is a movie? What is entertainment?..."
http://www.newsweek.com/id/217683
Things I Like - Books
I’ve mentioned Alexander McCall Smith before, the author of the book series The No. 1 Ladies’ Detective Agency. In addition to this delightful series, he has written three other series for adults, academic texts (mostly related to law and medical law), armloads of children’s books and several short story collections. In all, McCall Smith has written more than 60 books, all but 5 of them published in the last 20 years. He’s a very busy guy.His latest series, Corduroy Mansions is being published as an on-line novel. The first book was serialized last year – one chapter per day for 20 weeks at The Telegraph website. In addition, each chapter is read by Andrew Sachs (you can download the pod casts or listen to them on-line). It came out in book form this past year.
The second book in the series, “The Dog Who Came in From the Cold” started on the 21st of last month and the 34th chapter was published today. I’ve been unable to find the first series on line but you can read a summary of book one here.
The story takes place in a block of flats in Pimlico (an area of London) that have been nicknamed Corduroy Mansions by its residents. The flats are occupied by a group of interesting characters and a dog. The story isn’t great literature, but it is entertaining. As noted by the author:
"This is light social comedy, I suppose, but while I admit that the whole point of the exercise is for the reader to have fun, I hope in this story, nonetheless, to say something about how we live and about how finding love and meaning in the very small things of life may transform us, may make our ordinary lives more bearable."~ Andrew McCall Smith
I just finished the second chapter of “The Dog Who Came in From the Cold” – so far, I’m entertained.
Amazon Gives Up Adding Wine To Its Offerings
TW: Some may have heard Amazon was strongly considering adding wine to its product offerings. It recently decided against the move. Alcohol sales in the U.S. for the most part go through a 3 tiered system of suppliers/distributors/retailers. The entry of Amazon threatened that structure. The reactions from industry participants are interesting. Note much self-interest and little big picture analyis. A metaphor in other words for most political decisions.
Understand the tier most threatened by Amazon was obviously the middle distributor/wholesaler tier with retailers not far behind.
From Wine and Spirits Daily:
"Wine marketing consultant: "Regardless of the driving force to cease their operation, others will step forward to continue to push against state laws written in the 1930's to control the flow of alcohol with an inefficient & costly structure that ultimately punishes the consumer with a lack of true choice. Oddly, the states are limiting their own revenues by holding on to the outmoded model that restricts trade of their own in-state businesses."
Wholesaler: "Amazon exiting the wine business merely highlights beverage alcohol's special place in our society. The Three-Tier System has nicely balanced societal, regulatory and commercial needs for 75 years. Yes, it has its complexities but those are embedded for the "greater good" (e.g., taxes and fees collection, under-age drinking prevention, preclusion of tied houses of the past, etc.). If we were talking about books, small appliances or music, it would be a completely different matter. Alcohol deserves special, more-careful treatment."
Distillery: "It certainly hurts us "little guys" in the short term. We currently are set up to distribute only locally. A shift of consumers to purchasing online could open many doors, and I believe still will eventually happen."
Attorney: "AmazonWine's withdrawal is an example of the inefficiency and anti-competitive results that follow when every transaction is forced to go through the 3-tier system. Wholesalers serve a purpose and will never be obsolete but there is room in the industry for more than one path to get product to consumers."
Negociant: "Any channel that can provide direct wine shipments lawfully is a plus to the ailing wine industry. Far too many small (boutique) wineries have no equitable distribution networks. The three tier system is dominated by a handful of powerful distributors...who give attention to the mega wineries and their depletion/promotional dollars. In the end, the consumer loses and the small wineries lose. Eventually we'll have a handful of distributors and an equal number of large wine companies producing vanilla products for the masses."
Distributor association employee: "As a parent, I don't want my children to be able to click and purchase. As the spouse of a UPS driver, I don't want my husband's livelihood being challenged because he has been turned into a convenience store or liquor store clerk and may have missed a license check. Amazon has no business being in the wine selling business unless they plan to deliver it themselves, using their own employees and equipment. Wineries don't need Amazon to compete, they need to develop sound and viable business plans and quit "just being passionate" about making wine."
Winery, fulfillment: "No kid was ever arrested for driving drunk in a car, while drinking Broman Cellars Cabernet Sauvignon or Chateauneuf du Pape. With all this said and done...its' coming...direct sales to consumer...it's just a matter of time."
Retailer: "As a retail wine store, I can't compete with Amazon or any other large internet wine shipper. All can get better prices on the wine they sell because they are able to buy in large quantities - a lot of the protectionism you see in this industry is the legislators concerns, not about greedy wholesalers, but about local businesses. There is nothing to stop the consumer from tasting at my wine store and then going on line and buying the wine from some out of state retailer, who pays less in license fees, and does not assume the liability that I as a local business do. Internet wine sales, is a death knell for small business, and for the employees of the small business."
Understand the tier most threatened by Amazon was obviously the middle distributor/wholesaler tier with retailers not far behind.
From Wine and Spirits Daily:
"Wine marketing consultant: "Regardless of the driving force to cease their operation, others will step forward to continue to push against state laws written in the 1930's to control the flow of alcohol with an inefficient & costly structure that ultimately punishes the consumer with a lack of true choice. Oddly, the states are limiting their own revenues by holding on to the outmoded model that restricts trade of their own in-state businesses."
Wholesaler: "Amazon exiting the wine business merely highlights beverage alcohol's special place in our society. The Three-Tier System has nicely balanced societal, regulatory and commercial needs for 75 years. Yes, it has its complexities but those are embedded for the "greater good" (e.g., taxes and fees collection, under-age drinking prevention, preclusion of tied houses of the past, etc.). If we were talking about books, small appliances or music, it would be a completely different matter. Alcohol deserves special, more-careful treatment."
Distillery: "It certainly hurts us "little guys" in the short term. We currently are set up to distribute only locally. A shift of consumers to purchasing online could open many doors, and I believe still will eventually happen."
Attorney: "AmazonWine's withdrawal is an example of the inefficiency and anti-competitive results that follow when every transaction is forced to go through the 3-tier system. Wholesalers serve a purpose and will never be obsolete but there is room in the industry for more than one path to get product to consumers."
Negociant: "Any channel that can provide direct wine shipments lawfully is a plus to the ailing wine industry. Far too many small (boutique) wineries have no equitable distribution networks. The three tier system is dominated by a handful of powerful distributors...who give attention to the mega wineries and their depletion/promotional dollars. In the end, the consumer loses and the small wineries lose. Eventually we'll have a handful of distributors and an equal number of large wine companies producing vanilla products for the masses."
Distributor association employee: "As a parent, I don't want my children to be able to click and purchase. As the spouse of a UPS driver, I don't want my husband's livelihood being challenged because he has been turned into a convenience store or liquor store clerk and may have missed a license check. Amazon has no business being in the wine selling business unless they plan to deliver it themselves, using their own employees and equipment. Wineries don't need Amazon to compete, they need to develop sound and viable business plans and quit "just being passionate" about making wine."
Winery, fulfillment: "No kid was ever arrested for driving drunk in a car, while drinking Broman Cellars Cabernet Sauvignon or Chateauneuf du Pape. With all this said and done...its' coming...direct sales to consumer...it's just a matter of time."
Retailer: "As a retail wine store, I can't compete with Amazon or any other large internet wine shipper. All can get better prices on the wine they sell because they are able to buy in large quantities - a lot of the protectionism you see in this industry is the legislators concerns, not about greedy wholesalers, but about local businesses. There is nothing to stop the consumer from tasting at my wine store and then going on line and buying the wine from some out of state retailer, who pays less in license fees, and does not assume the liability that I as a local business do. Internet wine sales, is a death knell for small business, and for the employees of the small business."
Wednesday, October 28, 2009
Disease Perspective
(click on image to enlarge)TW: Some perspective, of course, infection rates must be multiplied by the fatality rate in order to assess relative mortalities.
The Germans And AfPak
TW: See below for my parsing of some German thoughts on AfPak. We need the Germans and the Germans should want to be engaged in AfPak, else they are free-riders. But if our policies suck (as they have frequently have) then engaging for them is very challenging.
From George Packer at New Yorker:
"Among those waiting for the outcome of the White House review of its Afghanistan strategy are the Germans. The country’s politicians refuse to call the war in Afghanistan a war. Germany’s participation was sold to the public here as peacekeeping and reconstruction, and that’s what it must remain to prevent any further erosion of support...The German politicians and journalists I’ve spoken with want Germany to do more, not less, in Afghanistan, even if that means fighting. Public opinion in this amazingly pacifist country runs otherwise, though only the extreme left and right want an immediate withdrawal. This gap between élite and mass opinion is a dangerous one, since there’s so little attempt by German leaders to explain the country’s position in the war and why it might be necessary to do more than build roads and schools. A single mass-casualty blow against German forces in Afghanistan (or against a soft target here in Germany—the intelligence traffic has been unusually heavy recently) could significantly change the terms of this non-debate.
I spoke with a senior German diplomat earlier this month, and several points he made struck me:
1.The Germans are waiting for an American position to emerge before they come up with their own. [TW: seems fair, they are not the only ones, if we back off most others will flee, on the other hand if we escalate we will need all hands on deck]
2.There is little to no real consultation of the NATO allies on the part of the White House—its strategy review is an internal affair. If so, this is really too bad. We have a lot to learn from our Europeans allies in Afghanistan. Germans in particular have ties there that go back to the nineteenth century. [TW: hopefully this is not literally true, allies always claim to be under-consulted, we should be engaging our allies strenuously, if we want their help we owe them engagement]
3.Germans have a hard time accepting the narrow rationale for the war in Afghanistan, based on preventing another 9/11. For them, the reason to be in Afghanistan is to prevent a return to power of the Taliban and with it an enormous propaganda victory for Islamists all over the world. In other words, Obama’s turn away from Bush’s more ideological agenda and toward a narrow focus on national security is not necessarily persuasive here, in spite of the former’s huge popularity and the latter’s abysmal reputation. (How’s that for irony?) [TW: I disagree with how Packer frames this. If Obama is merely trying to avert another 9/11 he is going to make big mistakes. On the other hand Bush's neo-con ideology was about imposing democracy and asserting American imperial capabilities. What Obama will hopefully do is ignore that ideology whilst pursuing realpolitik policies to stabilize the AfPak region which have little to do with democracy and U.S. imperialism but much to do with containing radical Islam and maintaining a stable Pakistan.]
4.The German attitude toward the fraudulent Afghan election is: what did you expect? It happens all the time in that part of the world. The problem comes when you raise expectations to an unreasonable level. I’ve also heard this view from a couple of American officials. Here, it seems connected to a sense of European realism, if not cynicism, toward America’s universalist approach to democracy when applied to non-European countries...
[TW: I agree with this attitude, getting wrapped up in Karzai's "democratic" credentials is a false errand]."
http://www.newyorker.com/online/blogs/georgepacker/2009/10/the-german-view-of-afghanistan.html
From George Packer at New Yorker:
"Among those waiting for the outcome of the White House review of its Afghanistan strategy are the Germans. The country’s politicians refuse to call the war in Afghanistan a war. Germany’s participation was sold to the public here as peacekeeping and reconstruction, and that’s what it must remain to prevent any further erosion of support...The German politicians and journalists I’ve spoken with want Germany to do more, not less, in Afghanistan, even if that means fighting. Public opinion in this amazingly pacifist country runs otherwise, though only the extreme left and right want an immediate withdrawal. This gap between élite and mass opinion is a dangerous one, since there’s so little attempt by German leaders to explain the country’s position in the war and why it might be necessary to do more than build roads and schools. A single mass-casualty blow against German forces in Afghanistan (or against a soft target here in Germany—the intelligence traffic has been unusually heavy recently) could significantly change the terms of this non-debate.
I spoke with a senior German diplomat earlier this month, and several points he made struck me:
1.The Germans are waiting for an American position to emerge before they come up with their own. [TW: seems fair, they are not the only ones, if we back off most others will flee, on the other hand if we escalate we will need all hands on deck]
2.There is little to no real consultation of the NATO allies on the part of the White House—its strategy review is an internal affair. If so, this is really too bad. We have a lot to learn from our Europeans allies in Afghanistan. Germans in particular have ties there that go back to the nineteenth century. [TW: hopefully this is not literally true, allies always claim to be under-consulted, we should be engaging our allies strenuously, if we want their help we owe them engagement]
3.Germans have a hard time accepting the narrow rationale for the war in Afghanistan, based on preventing another 9/11. For them, the reason to be in Afghanistan is to prevent a return to power of the Taliban and with it an enormous propaganda victory for Islamists all over the world. In other words, Obama’s turn away from Bush’s more ideological agenda and toward a narrow focus on national security is not necessarily persuasive here, in spite of the former’s huge popularity and the latter’s abysmal reputation. (How’s that for irony?) [TW: I disagree with how Packer frames this. If Obama is merely trying to avert another 9/11 he is going to make big mistakes. On the other hand Bush's neo-con ideology was about imposing democracy and asserting American imperial capabilities. What Obama will hopefully do is ignore that ideology whilst pursuing realpolitik policies to stabilize the AfPak region which have little to do with democracy and U.S. imperialism but much to do with containing radical Islam and maintaining a stable Pakistan.]
4.The German attitude toward the fraudulent Afghan election is: what did you expect? It happens all the time in that part of the world. The problem comes when you raise expectations to an unreasonable level. I’ve also heard this view from a couple of American officials. Here, it seems connected to a sense of European realism, if not cynicism, toward America’s universalist approach to democracy when applied to non-European countries...
[TW: I agree with this attitude, getting wrapped up in Karzai's "democratic" credentials is a false errand]."
http://www.newyorker.com/online/blogs/georgepacker/2009/10/the-german-view-of-afghanistan.html
Newt Gingrich: Too Liberal For the Repubs?
TW: Continuing on the theme from Monday' post, the Republicans are amidst the internal soulsearching common amongst tired, out of power parties (see Dems 1968-1992). The NY 23 race promises all upside for the Dems- if the conservative wins then the Palineolithic wing will be ascendent and hopefully well on its way to marginalizing the overall party. If the Dem wins, the Dems get an extra vote until giving the seat up next year.
The Newtster endorsed the actual Republican party candidate in NY 23, hence he is now subject to abuse from the Palineolithic wing. When the Newtster has become a "RINO"/too liberal, one should know Palineolithic wing has jumped the shark.
From Taegen Goddard:
"Since former House Speaker Newt Gingrich floated the idea of running for president over the weekend, the backlash from conservatives has been breathtaking. Combined with the reaction to his endorsement of the Republican in the NY-23 special election race over the Conservative Party candidate, it's clear Gingrich -- once the firebrand of the right -- is now considered a moderate.
Michele Malkin: "The conservative base is wising up and pushing back. And constantly invoking Reagan isn't going to erase the damage Gingrich has done to his brand over the years by wavering on core issues and teaming up with some of the Left's biggest clowns."
Dan Riehl: "Unless someone got the nomination and picked Newt for VP, there's no way I see him as viable. I don't think he'd make it through a Republican Primary given some of his stances over the years."
David Keene: "The fact of the matter is -- and I happen to like Newt personally -- he's a Republican gladiator, not a conservative. He's done a lot of good for conservatives. His ideas tend to be conservative. But Newt's a Republican first."
Atlantic Wire: "The man who led the GOP to a 1994 revival is now dismissed being by some on the right as a RINO -- Republican In Name Only. "
The Newtster endorsed the actual Republican party candidate in NY 23, hence he is now subject to abuse from the Palineolithic wing. When the Newtster has become a "RINO"/too liberal, one should know Palineolithic wing has jumped the shark.
From Taegen Goddard:
"Since former House Speaker Newt Gingrich floated the idea of running for president over the weekend, the backlash from conservatives has been breathtaking. Combined with the reaction to his endorsement of the Republican in the NY-23 special election race over the Conservative Party candidate, it's clear Gingrich -- once the firebrand of the right -- is now considered a moderate.
Michele Malkin: "The conservative base is wising up and pushing back. And constantly invoking Reagan isn't going to erase the damage Gingrich has done to his brand over the years by wavering on core issues and teaming up with some of the Left's biggest clowns."
Dan Riehl: "Unless someone got the nomination and picked Newt for VP, there's no way I see him as viable. I don't think he'd make it through a Republican Primary given some of his stances over the years."
David Keene: "The fact of the matter is -- and I happen to like Newt personally -- he's a Republican gladiator, not a conservative. He's done a lot of good for conservatives. His ideas tend to be conservative. But Newt's a Republican first."
Atlantic Wire: "The man who led the GOP to a 1994 revival is now dismissed being by some on the right as a RINO -- Republican In Name Only. "
Things I Like - Food
I found this article fascinating – but then, I am truly a geek: How to cook perfect boiled eggsThe article goes on to painstakingly address every step in the process of making soft and hard boiled eggs, from a scientific perspective and with illustrative photographs.
…Nearly every basic cookbook offers conflicting techniques on how it should be done—start the egg in cold water, or gently lower it into boiling water; add vinegar to the water to lower its pH, or add baking soda to the water to raise it; cover the pot, don't cover the pot; use old eggs, or use new eggs, and on and on—but very few offer evidence as to why any one of these techniques should work any better than your average old wives' tale. Apparently, boiling is not...ahem...an eggs-act science.
- J. Kenji Lopez-Alt at Serious Eats
If you can’t make the perfect egg after reading this…you should probably stay out of the kitchen.
Tuesday, October 27, 2009
Becker and Pethkoukis Missing the Point
TW: Pethkoukis entitles his post the "Exec. Comp. the Great Distraction". The piece to which he refers by conservative economist Becker asserts the Great Recession/Credit Implosion is not attributable to obscene executive/Wall Street compensation. He may be right. But obscene compensation is a symptom of the disease within our economy not a primary cause.
The outrage over compensation is not because folks attribute the crash to the compensation but because it appears unearned, inequitable and based upon power structures which benefit those at the top of the pyramid. Because the compensation structures did not "cause" the Crash is no reason not to address the compensation structures.
From Gary Becker via Jim Pethokoukis"
"I have not seen convincing evidence that either the level or structure of the pay of top financial executives were important causes of this worldwide financial crash. These executives bought large quantities of mortgage-backed securities and other securitized assets because they expected this to increase the average return on their assets without taking on much additional risk through the better risk management offered by derivatives, credit default swaps, and other newer types of securities. They turned out to be badly wrong, but so too were the many financial economists who had no sizable financial stake in these assets, but supported this approach to risk management.
The experience of other financial crashes also does not indicate that either the level or form of compensation of top financial executives were major factors in precipitating these crashes. Thousands of banks failed during the Great Depression, as did hundreds of American savings and loans institutions during the 1980s, without heads of these institutions in either case getting particularly high pay, or pay that was mainly in the form of bonuses and stock options. My impression is that this same conclusion applies to the Mexican bank crisis of the mid 1990s, and the Asian financial crisis at the end of the 1990s.
The generous bonuses and stock options received by financial executives may often have been unwarranted, but they are being used as a scapegoat for other more crucial factors. Financial institutions underrated the systemic risks of the more exotic assets, and apparently so too did the Fed and other regulators of financial institutions. In addition, large financial institutions may have recognized that they were “too big to fail”, and that they would be rescued by taxpayer monies if they were on the verge of bankruptcy because they took on excessively risky assets."
The outrage over compensation is not because folks attribute the crash to the compensation but because it appears unearned, inequitable and based upon power structures which benefit those at the top of the pyramid. Because the compensation structures did not "cause" the Crash is no reason not to address the compensation structures.
From Gary Becker via Jim Pethokoukis"
"I have not seen convincing evidence that either the level or structure of the pay of top financial executives were important causes of this worldwide financial crash. These executives bought large quantities of mortgage-backed securities and other securitized assets because they expected this to increase the average return on their assets without taking on much additional risk through the better risk management offered by derivatives, credit default swaps, and other newer types of securities. They turned out to be badly wrong, but so too were the many financial economists who had no sizable financial stake in these assets, but supported this approach to risk management.
The experience of other financial crashes also does not indicate that either the level or form of compensation of top financial executives were major factors in precipitating these crashes. Thousands of banks failed during the Great Depression, as did hundreds of American savings and loans institutions during the 1980s, without heads of these institutions in either case getting particularly high pay, or pay that was mainly in the form of bonuses and stock options. My impression is that this same conclusion applies to the Mexican bank crisis of the mid 1990s, and the Asian financial crisis at the end of the 1990s.
The generous bonuses and stock options received by financial executives may often have been unwarranted, but they are being used as a scapegoat for other more crucial factors. Financial institutions underrated the systemic risks of the more exotic assets, and apparently so too did the Fed and other regulators of financial institutions. In addition, large financial institutions may have recognized that they were “too big to fail”, and that they would be rescued by taxpayer monies if they were on the verge of bankruptcy because they took on excessively risky assets."
The Financial Crisis Devolution Into PR
TW: This piece follows on the Smith piece I cited a couple of days ago about the media's inability to deal with the financial crisis in a substantive way and in fact it has become a PR flack for Wall Street and the government. I agree. I struggle to post much on the financial crisis here because it is very detailed and quickly exceeds my own technical comfort and interest level. It is also boring unless you are very into financial arcana. It is, however, crucial.
Into this void flows PR and marketing and lobbyists. Both Wall Street and the government have become increasingly sophisticated in PR and branding. And when I say PR I mean someone taking reality and bending it towards their own benefit (i.e. the Bush push to invade Iraq as a prime example). PR folks are not necessarily bad people but they are most definitely not looking out for the greater good only the good of their own or their clients.
Folks sense we have (to date) avoided another Great Depression just barely and things like executive compensation are out of whack yet the impetus for financial reform appears to dim by the day.
From Jim Kwak at Baseline Scenario:
"...Pew Research Center to show that media coverage of the financial crisis and recession has focused primarily on political battles – stimulus, bailouts, etc. – rather than on problems in the real economy. What’s more, economic coverage in general has fallen off since the stock market rebound earlier this year and the Obama administration’s “all clear” signal. She also discusses psychological research that shows that people can be easily influenced to believe things that are not true, simply because people around them seem to believe those things.
Smith traces this phenomenon to two main sources: the steady evolution of journalism into a traditional profit-oriented business than can no longer afford to invest heavily in investigative journalism; and the increased ability of political leaders, following the lead of private corporations, to control the message that is transmitted via the media...
I had my first experience with modern PR during the Internet boom, when I was in marketing at Ariba. (Remember us? Market value of $40 billion at a time when our revenues were less than $100 million per quarter.) We would be planning an acquisition, and I would meet with these nice people from our PR firm who understood nothing about our technology, or our products, or our markets, or the company we were buying. And they would decide that our top-level messages needed to be X, Y, and Z, which were so devoid of content that they couldn’t even be accused of being false. And that’s what we would use in our press release and our analyst call, and a few hours later we would see it echoed in the news stories and the analyst comments.
Now, if you’re a company of only middling interest (even when we were the hottest thing in Silicon Valley, we were not one of America’s major companies), this is easy. You don’t have the New York Times or Wall Street Journal trying to bust you, and, it’s true, most of the people covering you tend to be nice — in part because they don’t want to lose their access, but probably more because, at the time, they wanted to be a part of our success. Calling a spade a spade would not only have been impolite, but it would have exposed the lie that all these Internet-era financial journalists and research analysts were living just as much as we were.
However, it should be a little harder for the government. But the fear of alienating sources no doubt plays a big role. And then there is the fact that the financial crisis and the recession are just complicated...it enables the government to avoid tackling the flaws in our financial and political systems that caused the crisis in the first place, and so, in a real sense, nothing has changed; it also minimizes an extremely severe recession and implies that there is little more to be done at this point to help the millions of people who are hurting from it. But that’s the message the government is putting out, and there’s not a lot that a few people who are crazy enough to spend their free time writing blogs can do about it.
...Out on Main Street, people may be out of work, unhappy, and confused, but there’s no political momentum for change, at least not on the real issues that affect their economic well-being.
http://baselinescenario.com/2009/10/16/move-along/
Into this void flows PR and marketing and lobbyists. Both Wall Street and the government have become increasingly sophisticated in PR and branding. And when I say PR I mean someone taking reality and bending it towards their own benefit (i.e. the Bush push to invade Iraq as a prime example). PR folks are not necessarily bad people but they are most definitely not looking out for the greater good only the good of their own or their clients.
Folks sense we have (to date) avoided another Great Depression just barely and things like executive compensation are out of whack yet the impetus for financial reform appears to dim by the day.
From Jim Kwak at Baseline Scenario:
"...Pew Research Center to show that media coverage of the financial crisis and recession has focused primarily on political battles – stimulus, bailouts, etc. – rather than on problems in the real economy. What’s more, economic coverage in general has fallen off since the stock market rebound earlier this year and the Obama administration’s “all clear” signal. She also discusses psychological research that shows that people can be easily influenced to believe things that are not true, simply because people around them seem to believe those things.
Smith traces this phenomenon to two main sources: the steady evolution of journalism into a traditional profit-oriented business than can no longer afford to invest heavily in investigative journalism; and the increased ability of political leaders, following the lead of private corporations, to control the message that is transmitted via the media...
I had my first experience with modern PR during the Internet boom, when I was in marketing at Ariba. (Remember us? Market value of $40 billion at a time when our revenues were less than $100 million per quarter.) We would be planning an acquisition, and I would meet with these nice people from our PR firm who understood nothing about our technology, or our products, or our markets, or the company we were buying. And they would decide that our top-level messages needed to be X, Y, and Z, which were so devoid of content that they couldn’t even be accused of being false. And that’s what we would use in our press release and our analyst call, and a few hours later we would see it echoed in the news stories and the analyst comments.
Now, if you’re a company of only middling interest (even when we were the hottest thing in Silicon Valley, we were not one of America’s major companies), this is easy. You don’t have the New York Times or Wall Street Journal trying to bust you, and, it’s true, most of the people covering you tend to be nice — in part because they don’t want to lose their access, but probably more because, at the time, they wanted to be a part of our success. Calling a spade a spade would not only have been impolite, but it would have exposed the lie that all these Internet-era financial journalists and research analysts were living just as much as we were.
However, it should be a little harder for the government. But the fear of alienating sources no doubt plays a big role. And then there is the fact that the financial crisis and the recession are just complicated...it enables the government to avoid tackling the flaws in our financial and political systems that caused the crisis in the first place, and so, in a real sense, nothing has changed; it also minimizes an extremely severe recession and implies that there is little more to be done at this point to help the millions of people who are hurting from it. But that’s the message the government is putting out, and there’s not a lot that a few people who are crazy enough to spend their free time writing blogs can do about it.
...Out on Main Street, people may be out of work, unhappy, and confused, but there’s no political momentum for change, at least not on the real issues that affect their economic well-being.
http://baselinescenario.com/2009/10/16/move-along/
Things I Like - Art
This was amazing – so creative
Note that the video begins a second loop at the 4:10 mark
Note that the video begins a second loop at the 4:10 mark
Pet Peeve: Estate Taxes
TW: And it is not because I dislike them. In fact my peeve is that some folks would end them. A favorite Republican gambit is the repeal of the "death" tax. The Republicans have been successful in reducing estate taxes but they would like to do more. One Senate bill described below would add roughly $250 billion to the deficits over the next ten years (and no the conservatives have not defined how they would "pay" for this gift to the wealthy).
Americans are terribly aspirational, a great thing, but the reality is the vast majority will never attain the asset levels subject to the estate tax. Republicans moan that "small business" owner and little, old farmers bear significant estate taxes...bullshit. The vast majority of these taxes are paid by folks with assets exceeding $10MM.
Americans have prided themselves on equality of opportunity and social mobility but wealth begets wealth. Wealth may not buy happiness but it buys education, connections, legal counsel and other power levers unavailable to those less well-endowed. One means, not the only, to mitigate the accumulation of power by elites is an estate tax. If folks want to index the asset levels, fine, even raising the minimum to $5MM is somewhat defensible although not necessary. But cutting the tax on the higher levels should not happen. What the U.S. does not need is yet more tax changes to improve the lot of those with the most.
From the Economist:
"...the Senate's Lincoln-Kyl bill to cap the estate tax at 35% (down from the current 45%), raise the exemption from $3.5m to $5m per person, and index the exemption to inflation. In its first decade after taking effect (2012-2021), the Center on Budget and Policy Priorities found, the bill would cost $250 billion over current law. The tax, notes the Center on Tax Policy, affects just 0.2% of decedents, or 6,000 households per year; 84% of the tax is paid by the extremely wealthy, with estates worth over $10m. Current law is already vastly more generous to wealthy estates than it was in 2000, when the exemption was set at $600,000[and the top rate was 55%]...
One of the standard attacks on the estate tax is the claim that it forces small business and farm owners' children to sell the family property because they don't have enough liquid assets to pay the tax. The American Farm Bureau claims that even the current version of the law "threaten(s) family-owned farm and ranches and the livelihoods of families who make their living in production agriculture", though the trade association provides no figures on how many farms are actually liable. The Tax Policy Center finds just 100 small family businesses and farms would pay any tax under current law; the Department of Agriculture's Economic Research Unit found 554 farms would be liable in 2009, but many of those may not meet any reasonable definition of "small". And Congress has already enacted measures letting farmers value their land at the lower "farm use value" rather than fair market value, exclude 40% of the value of the land, and repay the tax in installments over 15 years. Perhaps there ought to be some limits on how much more revenue our heavily indebted government should forego to cater to a few hundred people a year who have the misfortune to inherit assets worth over $3.5m.
...What kind of deficit hawk advocates slashing $250 billion in government revenue over ten years and giving 99.5% of it to extremely wealthy people who inherit millions of dollars from their parents? Clearly, if Artur Davis wants to become governor of Alabama, he's going to need the votes of a lot of people who voted for George Bush. But surely he can find some conservative causes to champion that actually make some sense, rather than playing along with the Bush-era philosophy of massive, deceptively-marketed tax cuts skewed towards the very rich that have left America with a crippling legacy of public debt."
http://www.economist.com/blogs/democracyinamerica/2009/10/who_wants_to_cut_the_estate_ta.cfm
Americans are terribly aspirational, a great thing, but the reality is the vast majority will never attain the asset levels subject to the estate tax. Republicans moan that "small business" owner and little, old farmers bear significant estate taxes...bullshit. The vast majority of these taxes are paid by folks with assets exceeding $10MM.
Americans have prided themselves on equality of opportunity and social mobility but wealth begets wealth. Wealth may not buy happiness but it buys education, connections, legal counsel and other power levers unavailable to those less well-endowed. One means, not the only, to mitigate the accumulation of power by elites is an estate tax. If folks want to index the asset levels, fine, even raising the minimum to $5MM is somewhat defensible although not necessary. But cutting the tax on the higher levels should not happen. What the U.S. does not need is yet more tax changes to improve the lot of those with the most.
From the Economist:
"...the Senate's Lincoln-Kyl bill to cap the estate tax at 35% (down from the current 45%), raise the exemption from $3.5m to $5m per person, and index the exemption to inflation. In its first decade after taking effect (2012-2021), the Center on Budget and Policy Priorities found, the bill would cost $250 billion over current law. The tax, notes the Center on Tax Policy, affects just 0.2% of decedents, or 6,000 households per year; 84% of the tax is paid by the extremely wealthy, with estates worth over $10m. Current law is already vastly more generous to wealthy estates than it was in 2000, when the exemption was set at $600,000[and the top rate was 55%]...
One of the standard attacks on the estate tax is the claim that it forces small business and farm owners' children to sell the family property because they don't have enough liquid assets to pay the tax. The American Farm Bureau claims that even the current version of the law "threaten(s) family-owned farm and ranches and the livelihoods of families who make their living in production agriculture", though the trade association provides no figures on how many farms are actually liable. The Tax Policy Center finds just 100 small family businesses and farms would pay any tax under current law; the Department of Agriculture's Economic Research Unit found 554 farms would be liable in 2009, but many of those may not meet any reasonable definition of "small". And Congress has already enacted measures letting farmers value their land at the lower "farm use value" rather than fair market value, exclude 40% of the value of the land, and repay the tax in installments over 15 years. Perhaps there ought to be some limits on how much more revenue our heavily indebted government should forego to cater to a few hundred people a year who have the misfortune to inherit assets worth over $3.5m.
...What kind of deficit hawk advocates slashing $250 billion in government revenue over ten years and giving 99.5% of it to extremely wealthy people who inherit millions of dollars from their parents? Clearly, if Artur Davis wants to become governor of Alabama, he's going to need the votes of a lot of people who voted for George Bush. But surely he can find some conservative causes to champion that actually make some sense, rather than playing along with the Bush-era philosophy of massive, deceptively-marketed tax cuts skewed towards the very rich that have left America with a crippling legacy of public debt."
http://www.economist.com/blogs/democracyinamerica/2009/10/who_wants_to_cut_the_estate_ta.cfm
Monday, October 26, 2009
Republicans=Democrats(circa 1980's)?
TW: I posted on this theme shortly after last year's elections. The Dems lost their coalition post 1964 and fought mainly amongst themselves for the next 25 years before tacking decisively towards the center with Bill Clinton et al. In the mean time but for the Watergate imbroglio bringing in Carter the party would have been out of the White House for that entire time. These shifts take time, the incumbents want to return to the good old days and the ideologues do what ideologues always do push for even more ideological purity.
The Republicans may benefit electorally over the next few years from temporary exogenous events (severe economic recessions, terror attacks etc.) but will have to re-define a more moderate positioning in order to re-gain broad power.
The kerfuffle in the upstate NY 23rd district special election is a great metaphor. The district is solid red but the Republicans have split between a centrist and an ideologue (running as a 3rd party candidate) such that the Dem may win (understanding if the Dem does win next month, the Dem will likely lose next year in the next general election when he likely faces only one Republican).
From Josh Marshall at TPM:
"Michael Smerconish, the Philly-based radio talk show host, has a column in the Inquirer today arguing that the GOP needs to seriously restructure its primary system in order to have any hope of nominating a potentially winning candidate in 2012 as opposed to one that will appeal to the party's base and ideological purists. His suggestions include regional primaries, moving up the dates of some high-population swing states, giving more of a stay to New England or key Western states, even giving more power to party bosses who have an institutional/professional interest in winning in addition to ideological aspirations.
On its face, it all makes a decent amount of sense if your angle is getting more electable Republicans. What struck me more though is how the arguments could have been lifted almost verbatim from the same conversation going on among Democrats through the 1970s and 1980s. Almost word for word, with the exception of the West and Northeast possibly playing the role of the South for the Dems in decades past. That strikes me as the most revealing thing about it.
The Republicans may benefit electorally over the next few years from temporary exogenous events (severe economic recessions, terror attacks etc.) but will have to re-define a more moderate positioning in order to re-gain broad power.
The kerfuffle in the upstate NY 23rd district special election is a great metaphor. The district is solid red but the Republicans have split between a centrist and an ideologue (running as a 3rd party candidate) such that the Dem may win (understanding if the Dem does win next month, the Dem will likely lose next year in the next general election when he likely faces only one Republican).
From Josh Marshall at TPM:
"Michael Smerconish, the Philly-based radio talk show host, has a column in the Inquirer today arguing that the GOP needs to seriously restructure its primary system in order to have any hope of nominating a potentially winning candidate in 2012 as opposed to one that will appeal to the party's base and ideological purists. His suggestions include regional primaries, moving up the dates of some high-population swing states, giving more of a stay to New England or key Western states, even giving more power to party bosses who have an institutional/professional interest in winning in addition to ideological aspirations.
On its face, it all makes a decent amount of sense if your angle is getting more electable Republicans. What struck me more though is how the arguments could have been lifted almost verbatim from the same conversation going on among Democrats through the 1970s and 1980s. Almost word for word, with the exception of the West and Northeast possibly playing the role of the South for the Dems in decades past. That strikes me as the most revealing thing about it.
Greed Trumps Fear Every Time
TW: Despite the beliefs of libertarian ideologues and those who take Ayn Rand too literally, capitalism needs rule sets. Auditors, banks, regulations and ratings agencies are crucial to well-functioning capitalist society. Unfortunately these rule monitors have dropped the ball. Enron bared the pitfalls with auditors. The credit crisis has done likewise with the ratings agencies. Greed is always in a battle with fear. Greed usually wins hence perhaps the need for some regulations.
From McClatchey News:
"As the housing market collapsed in late 2007, Moody's Investors Service, whose investment ratings were widely trusted, responded by purging analysts and executives who warned of trouble and promoting those who helped Wall Street plunge the country into its worst financial crisis since the Great Depression.
A McClatchy investigation has found that Moody's punished executives who questioned why the company was risking its reputation by putting its profits ahead of providing trustworthy ratings for investment offerings.
Instead, Moody's promoted executives who headed its "structured finance" division, which assisted Wall Street in packaging loans into securities for sale to investors. It also stacked its compliance department with the people who awarded the highest ratings to pools of mortgages that soon were downgraded to junk. Such products have another name now: "toxic assets."
..."The story at Moody's doesn't start in 2007; it starts in 2000," said Mark Froeba, a Harvard-educated lawyer and senior vice president who joined Moody's structured finance group in 1997.
"This was a systematic and aggressive strategy to replace a culture that was very conservative, an accuracy-and-quality oriented (culture), a getting-the-rating-right kind of culture, with a culture that was supposed to be 'business-friendly,' but was consistently less likely to assign a rating that was tougher than our competitors," Froeba said.
After Froeba and others raised concerns that the methodology Moody's was using to rate investment offerings allowed the firm's profit interests to trump honest ratings, he and nine other outspoken critics in his group were "downsized" in December 2007.
...Moody's was spun off from Dun & Bradstreet in 2000...Executives set out to erase a conservative corporate culture.
To promote competition, in the 1970s ratings agencies were allowed to switch from having investors pay for ratings to having the issuers of debt pay for them. That led the ratings agencies to compete for business by currying favor with investment banks that would pay handsomely for the ratings they wanted.
...Ratings agencies thrived on the profits that came from giving the investment banks what they wanted, and investors worldwide gorged themselves on bonds backed by U.S. car loans, credit card debt, student loans and, especially, mortgages...Nobody cared about due diligence so long as the money kept pouring in during the housing boom.
...One Moody's executive who soared through the ranks during the boom years was Brian Clarkson, the guru of structured finance. He was promoted to company president just as the bottom fell out of the housing market...Several former Moody's executives said he made subordinates fear they'd be fired if they didn't issue ratings that matched competitors' and helped preserve Moody's market share.
...The ratings agencies were under no legal obligation since technically their job is only to give an opinion, protected as free speech, in the form of ratings.
...Experts such as Columbia University's Coffee think that Congress must impose some legal liability on credit rating agencies. Otherwise, they'll remain "just one more conflicted gatekeeper," and the process of pooling loans — essential to the flow of credit — will remain paralyzed and economic recovery restrained.
"If (credit) remains paralyzed, small banks cannot finance the housing demand. They have to take them (investment banks) these mortgages and move them to a global audience," said Coffee. "That can't happen unless the world trusts the gatekeeper."
From McClatchey News:
"As the housing market collapsed in late 2007, Moody's Investors Service, whose investment ratings were widely trusted, responded by purging analysts and executives who warned of trouble and promoting those who helped Wall Street plunge the country into its worst financial crisis since the Great Depression.
A McClatchy investigation has found that Moody's punished executives who questioned why the company was risking its reputation by putting its profits ahead of providing trustworthy ratings for investment offerings.
Instead, Moody's promoted executives who headed its "structured finance" division, which assisted Wall Street in packaging loans into securities for sale to investors. It also stacked its compliance department with the people who awarded the highest ratings to pools of mortgages that soon were downgraded to junk. Such products have another name now: "toxic assets."
..."The story at Moody's doesn't start in 2007; it starts in 2000," said Mark Froeba, a Harvard-educated lawyer and senior vice president who joined Moody's structured finance group in 1997.
"This was a systematic and aggressive strategy to replace a culture that was very conservative, an accuracy-and-quality oriented (culture), a getting-the-rating-right kind of culture, with a culture that was supposed to be 'business-friendly,' but was consistently less likely to assign a rating that was tougher than our competitors," Froeba said.
After Froeba and others raised concerns that the methodology Moody's was using to rate investment offerings allowed the firm's profit interests to trump honest ratings, he and nine other outspoken critics in his group were "downsized" in December 2007.
...Moody's was spun off from Dun & Bradstreet in 2000...Executives set out to erase a conservative corporate culture.
To promote competition, in the 1970s ratings agencies were allowed to switch from having investors pay for ratings to having the issuers of debt pay for them. That led the ratings agencies to compete for business by currying favor with investment banks that would pay handsomely for the ratings they wanted.
...Ratings agencies thrived on the profits that came from giving the investment banks what they wanted, and investors worldwide gorged themselves on bonds backed by U.S. car loans, credit card debt, student loans and, especially, mortgages...Nobody cared about due diligence so long as the money kept pouring in during the housing boom.
...One Moody's executive who soared through the ranks during the boom years was Brian Clarkson, the guru of structured finance. He was promoted to company president just as the bottom fell out of the housing market...Several former Moody's executives said he made subordinates fear they'd be fired if they didn't issue ratings that matched competitors' and helped preserve Moody's market share.
...The ratings agencies were under no legal obligation since technically their job is only to give an opinion, protected as free speech, in the form of ratings.
...Experts such as Columbia University's Coffee think that Congress must impose some legal liability on credit rating agencies. Otherwise, they'll remain "just one more conflicted gatekeeper," and the process of pooling loans — essential to the flow of credit — will remain paralyzed and economic recovery restrained.
"If (credit) remains paralyzed, small banks cannot finance the housing demand. They have to take them (investment banks) these mortgages and move them to a global audience," said Coffee. "That can't happen unless the world trusts the gatekeeper."
Things I Like - Humor
Some bizarre photos to kick off the week
Not the White House...but a replica for sale near Atlanta
The Toilet Waterfall Wall - the Chinese have interesting public art
Because even your dolls need dolls
Salvador Dali walking his anteater...
Not the White House...but a replica for sale near Atlanta
The Toilet Waterfall Wall - the Chinese have interesting public art
Because even your dolls need dolls
Salvador Dali walking his anteater...
Bartlett Gets It
TW: Bartlett, fmr. Reagan economist, and Paul Krugman, Nobel Prize winner in economics, are converging. In this piece readers will see more familiar angles: the need for spending to revive the economy; the paradox of thrift which leads folks to save rather than spend tax rebates/cuts; and importantly a reminder of the ignorance of those claiming "Obama is spending America into [name your bombastic abyss]". The deficits were going to be huge this year and for coming years regardless of who became POTUS. Most importantly contractionary policies this year would have been "nonsensical" (I would add "dangerous").
What folks neglect amidst the braying about "socialism" and "spending us into the abyss", is what alternative policies would the numbskulls have proposed?
From Bruce Bartlett at Capital Gains and Games:
"...According to the Congressional Budget Office's January 2009 estimate for fiscal year 2009, outlays were projected to be $3,543 billion and revenues were projected to be $2,357 billion, leaving a deficit of $1,186 billion. Keep in mind that these estimates were made before Obama took office, based on existing law and policy, and did not take into account any actions that Obama might implement.
Therefore, unless one thinks that McCain would have somehow or other raised taxes and cut spending (with a Democratic Congress), rather than enacting a stimulus of his own, then a deficit of $1.2 trillion was baked in the cake the day Obama took office. Any suggestion that McCain would have brought in a lower deficit is simply fanciful.
Now let's fast forward to the end of fiscal year 2009, which ended on September 30. According to CBO, it ended with spending at $3,515 billion and revenues of $2,106 billion for a deficit of $1,409 billion.
To recap, the deficit came in $223 billion higher than projected, but spending was $28 billion and revenues were $251 billion less than expected. Thus we can conclude that more than 100 percent of the increase in the deficit since January is accounted for by lower revenues. Not one penny is due to higher spending.
It should be further noted that revenues are lower to a large extent because of tax cuts included in the February stimulus. According to the Joint Committee on Taxation, these tax cuts reduced revenues in FY2009 by $98 billion over what would otherwise have been the case. This is important because the Republican position has consistently been that tax cuts and only tax cuts are an appropriate response to the economic crisis.
...As if we needed further evidence that transfers have virtually no stimulative effect, the Bureau of Labor Statistics just issued a report on the 2008 tax rebate showing that only 30 percent of the money was spent; the rest was saved, thus providing no stimulus to short-run growth...On January 24, 2008, George W. Bush assured the country that a tax rebate was just the right medicine to prevent an economic downturn.
It continues to amaze me that no one on the left or right seems to have noticed that the essential factor causing the economic downturn is a decline in velocity: the number of times that money turns over in the economy, which is measured as the ratio of the money supply to GDP. In 2006 and 2007 this ratio was 1.9. I take that as normal. In 2008, velocity fell to 1.76 and currently is 1.69. (I divided end of year M2 into 4th quarter GDP; the latest figure is 2nd quarter GDP divided by end of June money supply.)
If velocity were 1.9 instead of 1.69, 2nd quarter GDP would have been $1.6 trillion higher. Therefore, no recession. The output gap would have simply disappeared. From this I conclude that a lack of spending in the economy is the central problem and the only policies that will help are those that increase spending - consumer spending, investment spending, net exports or government spending. How tax cuts would have helped - or at least the type of tax cuts advocated by Republicans - is a mystery to me.
I continue to believe that the Republican position is nonsensical. Final proof is that the previously cited CBO report shows total federal revenues coming in at 14.9 percent of the gross domestic product in FY2009. According to the Office of Management and Budget, one has to go back to 1950 to find a year when federal revenues were lower as a share of GDP. For reference, revenues averaged 18 percent of GDP during the Reagan administration and were never lower than 17.3 percent - 2.4 percent of GDP above where they are now.
I think there are grounds on which to criticize the Obama administration's anti-recession actions. But spending too much is not one of them. Indeed, based on this analysis, it is pretty obvious that spending - real spending on things like public works - has been grossly inadequate. The idea that Reagan-style tax cuts would have done anything is just nuts."
http://capitalgainsandgames.com/blog/bruce-bartlett/1200/why-economy-needs-spending-not-tax-cuts
What folks neglect amidst the braying about "socialism" and "spending us into the abyss", is what alternative policies would the numbskulls have proposed?
From Bruce Bartlett at Capital Gains and Games:
"...According to the Congressional Budget Office's January 2009 estimate for fiscal year 2009, outlays were projected to be $3,543 billion and revenues were projected to be $2,357 billion, leaving a deficit of $1,186 billion. Keep in mind that these estimates were made before Obama took office, based on existing law and policy, and did not take into account any actions that Obama might implement.
Therefore, unless one thinks that McCain would have somehow or other raised taxes and cut spending (with a Democratic Congress), rather than enacting a stimulus of his own, then a deficit of $1.2 trillion was baked in the cake the day Obama took office. Any suggestion that McCain would have brought in a lower deficit is simply fanciful.
Now let's fast forward to the end of fiscal year 2009, which ended on September 30. According to CBO, it ended with spending at $3,515 billion and revenues of $2,106 billion for a deficit of $1,409 billion.
To recap, the deficit came in $223 billion higher than projected, but spending was $28 billion and revenues were $251 billion less than expected. Thus we can conclude that more than 100 percent of the increase in the deficit since January is accounted for by lower revenues. Not one penny is due to higher spending.
It should be further noted that revenues are lower to a large extent because of tax cuts included in the February stimulus. According to the Joint Committee on Taxation, these tax cuts reduced revenues in FY2009 by $98 billion over what would otherwise have been the case. This is important because the Republican position has consistently been that tax cuts and only tax cuts are an appropriate response to the economic crisis.
...As if we needed further evidence that transfers have virtually no stimulative effect, the Bureau of Labor Statistics just issued a report on the 2008 tax rebate showing that only 30 percent of the money was spent; the rest was saved, thus providing no stimulus to short-run growth...On January 24, 2008, George W. Bush assured the country that a tax rebate was just the right medicine to prevent an economic downturn.
It continues to amaze me that no one on the left or right seems to have noticed that the essential factor causing the economic downturn is a decline in velocity: the number of times that money turns over in the economy, which is measured as the ratio of the money supply to GDP. In 2006 and 2007 this ratio was 1.9. I take that as normal. In 2008, velocity fell to 1.76 and currently is 1.69. (I divided end of year M2 into 4th quarter GDP; the latest figure is 2nd quarter GDP divided by end of June money supply.)
If velocity were 1.9 instead of 1.69, 2nd quarter GDP would have been $1.6 trillion higher. Therefore, no recession. The output gap would have simply disappeared. From this I conclude that a lack of spending in the economy is the central problem and the only policies that will help are those that increase spending - consumer spending, investment spending, net exports or government spending. How tax cuts would have helped - or at least the type of tax cuts advocated by Republicans - is a mystery to me.
I continue to believe that the Republican position is nonsensical. Final proof is that the previously cited CBO report shows total federal revenues coming in at 14.9 percent of the gross domestic product in FY2009. According to the Office of Management and Budget, one has to go back to 1950 to find a year when federal revenues were lower as a share of GDP. For reference, revenues averaged 18 percent of GDP during the Reagan administration and were never lower than 17.3 percent - 2.4 percent of GDP above where they are now.
I think there are grounds on which to criticize the Obama administration's anti-recession actions. But spending too much is not one of them. Indeed, based on this analysis, it is pretty obvious that spending - real spending on things like public works - has been grossly inadequate. The idea that Reagan-style tax cuts would have done anything is just nuts."
http://capitalgainsandgames.com/blog/bruce-bartlett/1200/why-economy-needs-spending-not-tax-cuts
Sunday, October 25, 2009
Colorized Boston
(click to enlarge)TW: We have not had a Shorpy for awhile. This is a colorized 1890 shot from Boston near a train station. Color even artificial always provides a unique feel for times gone by. I especially liked the billboard cart, some things never change.
Media As PR Flacks For Power
TW: This piece on media comes from the angle of a financial blogger but the themes are familiar to this blog: echo chambers, media submissiveness and manipulation. Except this time instead of focusing on partisan politics Smith examines the battle over Wall Street compensation and ultimately how elites continue (this did not just start recently) to centralize their own power and economic well-being.
From Yves Smith at Naked Capitalism:
"I’m of two minds about taking up this theme, since stating what ought to be obvious but is nevertheless unpleasant and inconvenient is apt to get one branded as lunatic fringe.
Access journalism has created what is in many respects a controlled press. And that matters because people are far more suggestible than most of us wants to admit to ourselves.
...The press has been on a downslope for at least a decade, as a result of strained budgets and vastly more effective government and business spin control...I met a reporter who had been overseas for six years, opening an important foreign office for the Wall Street Journal. He was stunned when he came back in 1999 to see how much reporting had changed in his absence. He said it was impossible to get to the bottom of most stories in a normal news cycle because companies had become very sophisticated in controlling their message and access.
I couldn’t tell immediately, but one of my friends remarked in 2000 that the reporting was increasingly reminiscent of what she had grown up with in communist Poland. The state of the US media became evident to me when I lived in Australia during the run-up and the first two years of the Gulf War. I would regularly e-mail people in the States about stories I thought were important and I suspected might not be getting much play in the US. My correspondents were media junkies. 85% of the time, a story that had gotten widespread coverage in Australia appeared not to have been released in the US. And the other 15%, it didn’t get much attention (for instance, buried in the middle of the first section of the New York Times). And remember, Australia was an ally and sent troops to the Iraq.
...Back to the main theme: the media dares not say anything too negative about financial services firms or their government operatives lest they lose access. The private sector has learned the lesson of the Bush Administration, that the threat of freezing a reporter out is a powerful weapon. I have had some well connected readers tell of story ideas that they served up in some detail that the media would not touch out of fear of alienating their sources. This is the sort of thing that one associates with banana republics, but we have been operating on that level for quite some time.
...So what do we have? A media that predominantly bases its stories on what it is fed because it has to. Ever-leaner staffing, compressed news cycles, and access journalism all conspire to drive reporters to focus on the “must cover” news, which is to a large degree influenced by the parties that initiate the story. And that means they are increasingly in an echo chamber, spending so much time with the influential sources they feel they must cover that they start to be swayed by them. It is less intense, but not dissimilar to the effect achieved when reporters are embedded in military units. The journalists often wind up adopting the views of the people they associate with frequently...
...the Wall Street Journal said of bonus outrage: “That’s so last March.”
Maybe taxpayers have simply given up on Washington’s efforts to corral Wall Street.
Now why is this sort of thing (and the media was full of more subtle versions, of happy talk re Dow 10,000 and Goldman earnings) more pernicious than it might appear?
The message, quite overly, is: if you are pissed, you are in a minority. The country has moved on. Things are getting better, get with the program. Now I saw the polar opposite today. There is a group of varying sizes, depending on the topic, that e-mails among itself, mainly professional investors, analysts, economists (I’m usually on the periphery but sometimes chime in). I never saw such an angry, active, and large thread about the Goldman BS fest today. Now if people who have not suffered much, and are presumably benefitting from the market recovery are furious, it isn’t hard to imagine that what looks like complacency in the heartlands may simply be contained rage looking for an outlet.
...Now America does not have a tradition of taking to the streets; demonstrations and rallies historically are working class affairs. But the middle class is on a path of downward mobility while the elites continue to take the cream. The widening gap might waken some impulses that have been dormant in the American psyche."
http://www.nakedcapitalism.com/2009/10/msm-reporting-as-propaganda-no-one-minds-our-new-financial-lords-and-masters-edition.html
From Yves Smith at Naked Capitalism:
"I’m of two minds about taking up this theme, since stating what ought to be obvious but is nevertheless unpleasant and inconvenient is apt to get one branded as lunatic fringe.
Access journalism has created what is in many respects a controlled press. And that matters because people are far more suggestible than most of us wants to admit to ourselves.
...The press has been on a downslope for at least a decade, as a result of strained budgets and vastly more effective government and business spin control...I met a reporter who had been overseas for six years, opening an important foreign office for the Wall Street Journal. He was stunned when he came back in 1999 to see how much reporting had changed in his absence. He said it was impossible to get to the bottom of most stories in a normal news cycle because companies had become very sophisticated in controlling their message and access.
I couldn’t tell immediately, but one of my friends remarked in 2000 that the reporting was increasingly reminiscent of what she had grown up with in communist Poland. The state of the US media became evident to me when I lived in Australia during the run-up and the first two years of the Gulf War. I would regularly e-mail people in the States about stories I thought were important and I suspected might not be getting much play in the US. My correspondents were media junkies. 85% of the time, a story that had gotten widespread coverage in Australia appeared not to have been released in the US. And the other 15%, it didn’t get much attention (for instance, buried in the middle of the first section of the New York Times). And remember, Australia was an ally and sent troops to the Iraq.
...Back to the main theme: the media dares not say anything too negative about financial services firms or their government operatives lest they lose access. The private sector has learned the lesson of the Bush Administration, that the threat of freezing a reporter out is a powerful weapon. I have had some well connected readers tell of story ideas that they served up in some detail that the media would not touch out of fear of alienating their sources. This is the sort of thing that one associates with banana republics, but we have been operating on that level for quite some time.
...So what do we have? A media that predominantly bases its stories on what it is fed because it has to. Ever-leaner staffing, compressed news cycles, and access journalism all conspire to drive reporters to focus on the “must cover” news, which is to a large degree influenced by the parties that initiate the story. And that means they are increasingly in an echo chamber, spending so much time with the influential sources they feel they must cover that they start to be swayed by them. It is less intense, but not dissimilar to the effect achieved when reporters are embedded in military units. The journalists often wind up adopting the views of the people they associate with frequently...
...the Wall Street Journal said of bonus outrage: “That’s so last March.”
Maybe taxpayers have simply given up on Washington’s efforts to corral Wall Street.
Now why is this sort of thing (and the media was full of more subtle versions, of happy talk re Dow 10,000 and Goldman earnings) more pernicious than it might appear?
The message, quite overly, is: if you are pissed, you are in a minority. The country has moved on. Things are getting better, get with the program. Now I saw the polar opposite today. There is a group of varying sizes, depending on the topic, that e-mails among itself, mainly professional investors, analysts, economists (I’m usually on the periphery but sometimes chime in). I never saw such an angry, active, and large thread about the Goldman BS fest today. Now if people who have not suffered much, and are presumably benefitting from the market recovery are furious, it isn’t hard to imagine that what looks like complacency in the heartlands may simply be contained rage looking for an outlet.
...Now America does not have a tradition of taking to the streets; demonstrations and rallies historically are working class affairs. But the middle class is on a path of downward mobility while the elites continue to take the cream. The widening gap might waken some impulses that have been dormant in the American psyche."
http://www.nakedcapitalism.com/2009/10/msm-reporting-as-propaganda-no-one-minds-our-new-financial-lords-and-masters-edition.html
Some Hope In Pakistan?
TW: Pakistan as best I can tell has two governing bodies, the military and the civilian government of Zardari. Both are highly relevant. The military has been most reluctant to aggressively strike the Taliban. They have done so periodically and are doing so again presently. Perhaps this time will be more substantial and more permanent than previous efforts. This piece supports the notion that this time could be different in a positive way.
One of the reasons I believe the U.S. should escalate its presence in Afghanistan is to motivate and provide reassurance to the Pakistanis that their efforts within their border regions will backed by similarly aggressive and long-term actions by the U.S. and its allies. The Taliban are not necessarily popular in absolute terms merely somewhat popular in relative terms where security voids exist on both sides of the AfPak border. Coordinated Pakistani and allied efforts could in time crush the Taliban. Alternatively should the U.S. et al. back off in Afghanistan one could expect the Pakistanis to likewise back off leaving the Taliban with growing voids in which to expand.
From David Ignatius at WaPo:
"RAWALPINDI, PAKISTAN Until a few months ago, Pakistani officials often used the term "miscreants" when they described the Taliban fighters operating from the western tribal areas. This moniker conveyed the sense that the Taliban was a nuisance -- a ragtag band of fanatics and gangsters who could be placated with peace deals -- rather than a mortal threat to the nation.
That state of denial appears to be over. This week's offensive against Taliban sanctuaries in South Waziristan is the latest sign that Pakistan has awakened to the seriousness of its domestic terrorism problem...
Popular anger against the Taliban has been building this year. Back in April, the country seemed dazed and politically paralyzed. But as the Islamic extremists broke out of the Swat Valley that month and moved closer to the capital, something changed. The army launched an aggressive campaign in Swat, the Taliban fighters were pushed back and the public cheered.
The Taliban countered with a recent wave of terrorist attacks, and a visitor sees more checkpoints and roadblocks now than a few weeks ago. People are edgy, but the suicide bombers haven't broken public support for the army's assault in Waziristan. Quite the opposite, judging from editorials in the country's sometimes strident newspapers.
"The politicians may be divided over other matters but are united over the need for a military operation against the terrorists," wrote the Daily Times. "If peace is to be restored in Pakistan, militancy has to be crushed," argued the Post. Dawn editorialized that "at the moment, the political will and public support is on the security forces' side."
...Abbas says that to win, the army must be seen as operating independently of the United States: "We told the Americans, stay away. Let us do it." To demonstrate that independence, the Pakistanis asked the United States to halt its highly effective Predator drone attacks over South Waziristan. "Public support is more important," explains one military official.
Pakistan has pledged action against the Taliban in the past, only to make peace agreements when the fighting got tough. It's too early to say whether the early resolve this time will carry through the harsh winter, as the army confronts the notoriously tough Mehsud tribesmen. In the tribal areas, "people are always on the winning side. They wait and see the outcome," says Abbas..."
http://www.washingtonpost.com/wp-dyn/content/article/2009/10/21/AR2009102102848.html?hpid=opinionsbox1
One of the reasons I believe the U.S. should escalate its presence in Afghanistan is to motivate and provide reassurance to the Pakistanis that their efforts within their border regions will backed by similarly aggressive and long-term actions by the U.S. and its allies. The Taliban are not necessarily popular in absolute terms merely somewhat popular in relative terms where security voids exist on both sides of the AfPak border. Coordinated Pakistani and allied efforts could in time crush the Taliban. Alternatively should the U.S. et al. back off in Afghanistan one could expect the Pakistanis to likewise back off leaving the Taliban with growing voids in which to expand.
From David Ignatius at WaPo:
"RAWALPINDI, PAKISTAN Until a few months ago, Pakistani officials often used the term "miscreants" when they described the Taliban fighters operating from the western tribal areas. This moniker conveyed the sense that the Taliban was a nuisance -- a ragtag band of fanatics and gangsters who could be placated with peace deals -- rather than a mortal threat to the nation.
That state of denial appears to be over. This week's offensive against Taliban sanctuaries in South Waziristan is the latest sign that Pakistan has awakened to the seriousness of its domestic terrorism problem...
Popular anger against the Taliban has been building this year. Back in April, the country seemed dazed and politically paralyzed. But as the Islamic extremists broke out of the Swat Valley that month and moved closer to the capital, something changed. The army launched an aggressive campaign in Swat, the Taliban fighters were pushed back and the public cheered.
The Taliban countered with a recent wave of terrorist attacks, and a visitor sees more checkpoints and roadblocks now than a few weeks ago. People are edgy, but the suicide bombers haven't broken public support for the army's assault in Waziristan. Quite the opposite, judging from editorials in the country's sometimes strident newspapers.
"The politicians may be divided over other matters but are united over the need for a military operation against the terrorists," wrote the Daily Times. "If peace is to be restored in Pakistan, militancy has to be crushed," argued the Post. Dawn editorialized that "at the moment, the political will and public support is on the security forces' side."
...Abbas says that to win, the army must be seen as operating independently of the United States: "We told the Americans, stay away. Let us do it." To demonstrate that independence, the Pakistanis asked the United States to halt its highly effective Predator drone attacks over South Waziristan. "Public support is more important," explains one military official.
Pakistan has pledged action against the Taliban in the past, only to make peace agreements when the fighting got tough. It's too early to say whether the early resolve this time will carry through the harsh winter, as the army confronts the notoriously tough Mehsud tribesmen. In the tribal areas, "people are always on the winning side. They wait and see the outcome," says Abbas..."
http://www.washingtonpost.com/wp-dyn/content/article/2009/10/21/AR2009102102848.html?hpid=opinionsbox1
Things I Like - Odds & Ends
There’s been a LOT of construction in the River North area since we moved into the White House – I guess after almost 10 years, that’s not so unusual. Most of the new building has been residential and most of that has been pretty basic.
Sometimes basic is good…interesting as the buildings below might be, I’m not sure I would want to see them every time I looked out the window.
Kansas City Public Library
Kansas City, MO (source: 3)
Dancing House
Prague, Czech Republic (source: 4)
Krzywy Dom - Crooked House
Sopot, Poland (source: 2)
Longaberger Basket
Longeberger Basket Company headquarters - Newark, OH
(source: 4)
Forest Spiral
Hundertwasser Building - Darmstadt, Germany (source: 1)
Hang Nga Guesthouse
Vietnam (source: 1)
Sources:
1. ArtHistoryArchive.com - Bizarre Architecture
2. Quazen.com - Crazy and Bizarre Architecture
3. toptenz.net - Top 10 Bizarre Feats of Architecture
4. toptenz.net - Top 10 Eccentric Buildings
Sometimes basic is good…interesting as the buildings below might be, I’m not sure I would want to see them every time I looked out the window.
Kansas City Public Library
Kansas City, MO (source: 3)Dancing House
Prague, Czech Republic (source: 4)Krzywy Dom - Crooked House
Sopot, Poland (source: 2)Longaberger Basket
Longeberger Basket Company headquarters - Newark, OH(source: 4)
Forest Spiral
Hundertwasser Building - Darmstadt, Germany (source: 1)Hang Nga Guesthouse
Vietnam (source: 1)Sources:
1. ArtHistoryArchive.com - Bizarre Architecture
2. Quazen.com - Crazy and Bizarre Architecture
3. toptenz.net - Top 10 Bizarre Feats of Architecture
4. toptenz.net - Top 10 Eccentric Buildings
Saturday, October 24, 2009
Circular Health Care Logic
TW: Klein does a simple example to focus on some of the circular logic inherent in some of the conservative opposition to health care reform.
From Ezra Klein at WaPo:
"Imagine a world in which there are only 10 people. All of them want to buy health care. But some of them are sicker, or older, than others. Two of the 10 people cost $10 to cover. Two of them cost $2. And everyone else costs $5.
Like in our own world, insurers are pretty good at discriminating against the sick. They deny the two bad risks coverage. Average premiums are thus only $4.25 a person. That's not too bad.
But it is a bit cruel. After all, the people who need insurance most are locked out of the system. Recognizing the inequity, the 10 residents of our imaginary land elect Schmarack Schmobama president, in part because he's run on a platform of universal health care. He comes into office and passes a law saying insurers have to offer care to everybody at a similar price, and there will be subsidies to help those who can't afford the cost. What happens to premiums?
Well, as Michael Gerson says in his column today, they go up. With the two $10 risks included in the total, average premiums are now $4.40. The subsidies help people who can't shoulder the expense, but that's not quite the point. As Gerson writes, health-care reform has made "the average insurance plan more expensive." This is the first reason, he says, that "non-Maine Republicans object to the Senate Finance bill."
But the average insurance premium is now more expensive because insurers can't discriminate against the sick, and they can't discriminate as much against the old. Most of us -- even those of us in the middle class -- eventually become sick, and eventually become old. Our insurance plan might be more expensive now, and so we consider ourselves losers, but we won't be locked out later, which would have been losing on a whole other scale. Whether we come out ahead in a single year may well be different than whether we come out ahead over time. After all, insurance itself is a hedge against catastrophic bad luck. On some level, so too is this bill.
Moreover, this is emphatically not why non-Maine Republicans object to the bill, or at least it wasn't at one point. Republicans have bent over backwards to proclaim their openness to insurance market reforms. Sen. Mike Enzi, for instance, told AARP that, "I support fundamental changes that would prevent insurance companies from denying access to anyone needing health insurance coverage." If everyone can access coverage, then the risk pool will become more expensive because the bad risks will no longer be locked out. Enzi, in other words, supports the fundamental change that raises average premiums.
Conversely, the pieces of the bill that have driven the most partisan bickering have been the elements that would drop the cost of average premiums. You may or may not like the public plan, but the Congressional Budget Office and many other analysts have said it will lead to lower premiums for consumers. The individual mandate has sparked a fair amount of Republican opposition, but its purpose is to pull healthy customers into the pool so average premiums remain low. The level of subsidies has created some controversy, but it will offset the premiums costs for most consumers.
Republicans have adopted the insurance industry's talking point that health-care reform will "make the average insurance plan more expensive." The problem is, most of them support, or have previously supported, the elements of the plan that drive that increase. And most of them oppose both the insurance industry's ideas for mitigating the problem (a much stronger individual mandate) and the elements of the Democratic bills that would drive down premium costs..."
http://voices.washingtonpost.com/ezra-klein/2009/10/is_this_why_republicans_cant_s.html
From Ezra Klein at WaPo:
"Imagine a world in which there are only 10 people. All of them want to buy health care. But some of them are sicker, or older, than others. Two of the 10 people cost $10 to cover. Two of them cost $2. And everyone else costs $5.
Like in our own world, insurers are pretty good at discriminating against the sick. They deny the two bad risks coverage. Average premiums are thus only $4.25 a person. That's not too bad.
But it is a bit cruel. After all, the people who need insurance most are locked out of the system. Recognizing the inequity, the 10 residents of our imaginary land elect Schmarack Schmobama president, in part because he's run on a platform of universal health care. He comes into office and passes a law saying insurers have to offer care to everybody at a similar price, and there will be subsidies to help those who can't afford the cost. What happens to premiums?
Well, as Michael Gerson says in his column today, they go up. With the two $10 risks included in the total, average premiums are now $4.40. The subsidies help people who can't shoulder the expense, but that's not quite the point. As Gerson writes, health-care reform has made "the average insurance plan more expensive." This is the first reason, he says, that "non-Maine Republicans object to the Senate Finance bill."
But the average insurance premium is now more expensive because insurers can't discriminate against the sick, and they can't discriminate as much against the old. Most of us -- even those of us in the middle class -- eventually become sick, and eventually become old. Our insurance plan might be more expensive now, and so we consider ourselves losers, but we won't be locked out later, which would have been losing on a whole other scale. Whether we come out ahead in a single year may well be different than whether we come out ahead over time. After all, insurance itself is a hedge against catastrophic bad luck. On some level, so too is this bill.
Moreover, this is emphatically not why non-Maine Republicans object to the bill, or at least it wasn't at one point. Republicans have bent over backwards to proclaim their openness to insurance market reforms. Sen. Mike Enzi, for instance, told AARP that, "I support fundamental changes that would prevent insurance companies from denying access to anyone needing health insurance coverage." If everyone can access coverage, then the risk pool will become more expensive because the bad risks will no longer be locked out. Enzi, in other words, supports the fundamental change that raises average premiums.
Conversely, the pieces of the bill that have driven the most partisan bickering have been the elements that would drop the cost of average premiums. You may or may not like the public plan, but the Congressional Budget Office and many other analysts have said it will lead to lower premiums for consumers. The individual mandate has sparked a fair amount of Republican opposition, but its purpose is to pull healthy customers into the pool so average premiums remain low. The level of subsidies has created some controversy, but it will offset the premiums costs for most consumers.
Republicans have adopted the insurance industry's talking point that health-care reform will "make the average insurance plan more expensive." The problem is, most of them support, or have previously supported, the elements of the plan that drive that increase. And most of them oppose both the insurance industry's ideas for mitigating the problem (a much stronger individual mandate) and the elements of the Democratic bills that would drive down premium costs..."
http://voices.washingtonpost.com/ezra-klein/2009/10/is_this_why_republicans_cant_s.html
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