Thursday, November 27, 2008

Iraq Parliament approves SOFA

Iraq Approves Long-Debated U.S. Security Pact
By RANIA ABOUZEID
Thu Nov 27, 2008
Time
Iraq's Prime Minister Nouri al-Maliki on Thursday finally got the broad consensus he sought on the Status of Forces Agreement with the U.S. - 149 of the 198 lawmakers present in the 275-member National Assembly gave their support to a deal that allows American forces to remain in Iraq until the end of 2011.

Now maybe W's Administration will publish the official English version so we can all learn what we're now committed to!

p.s. "Ask and you shall receive."
Here's a link to the text: Iraq SOFA

Happy Thanksgiving!

I'll start an annual tradition - re-running last year's Thanksgiving post:
Thanksgiving is my favorite holiday.
It's secular - religious overtones are secondary.
It's American - the rest of world goes on happily without us.

Most of all, for me the basic premise - giving thanks - is a good thing. Yes, I am thankful for my family, for my undeserved good-fortune in life, for friends.

Most of my family is in town. None of us started out here - we all just ended up here. I've 3 sisters. 2 of 'em are in town, with their husbands. My mom is in town. My wife's folks are in town. Her sister & bro-in-law are in town. A sister's sister-in-law is in town. Our kids are in town. My daughter-in-law's folks are in town.

What this means from a Thankgiving perspective is that we enjoy a pretty phenomenal feast each year. Someone volunteers to host - this year it was my son & daughter-in-law. Host is responsible for turkey. Everything else is provided by everyone else. Everyone brings enough to feed everyone.

My bad: I do not feel guilty about this surfeit. I AM thankful!

So: Happy Thanksgiving, with friends & family!
This year bro- and sis-in-law (my wife's sister) are hosting. In addition to standard Thanksgiving, the feast will likely include tamales from a local eatery - sis-in-law Brenda almost always provides these for large gatherings!

Here's hoping you all have reason to give thanks!

Tuesday, November 25, 2008

"Self-regulation", Citi style

Citigroup Saw No Red Flags Even as It Made Bolder Bets
NYT
By ERIC DASH and JULIE CRESWELL
Published: November 22, 2008
... But many Citigroup insiders say the bank’s risk managers never investigated deeply enough. Because of longstanding ties that clouded their judgment, the very people charged with overseeing deal makers eager to increase short-term earnings — and executives’ multimillion-dollar bonuses — failed to rein them in, these insiders say.

Again: the next time your respected opponent mentions "self-regulation", laugh loudly.

Digression: The article cited above reads a lot like similar post-mortem articles written about Enron.
Seems no one paid much attention to the dynamics of Enron's failure once the blame was pinned on Lay, Skilling, and Fastow.
"Just a few bad apples - that could never happen here!"

Yes, Lay was willfully, negligently ignorant. Yes, Skilling pushed beyond the bounds of prudent business practice; and yes, Fastow was more than happy to take advantage of Skilling's greed to line his own pockets... but the real story was the complete failure of Enron's internal controls.

... and, yes: it could happen "here" - wherever "here" might be!

W's "partners" seem to be playing for Team Obama

Afghanistan demands 'timeline' for end of military intervention
Tue Nov 25, 2008
KABUL (AFP) – President Hamid Karzai demanded at a meeting with a UN Security Council team Tuesday that the international community set a "timeline" for ending military intervention in Afghanistan, his office said.

Karzai told a delegation from the Council that his country needed to know how long the US-led "war on terror" was going to be fought in Afghanistan or it would have to seek a political solution to a Taliban-led insurgency.


Between the Iraq SOFA & Karzai's new-found independence, could be the U.S. will be disengaged from W's fiascos sooner rather than later.

Stop the madness!

"Now, what was the question?"

From C&L (Paul Krugman: 'Caricature Economics`):
Looking for new ideas to help the economy? Please don't look to Rep. John Boehner for any new ideas. And this is not from the debate episode of the West Wing.
He said this on FNS:
“If we’re really serious about creating jobs, what we ought to do is, we ought to eliminate the capital gains tax for the next two years on any equities that are purchased,” he said. He argued that cutting the corporate income tax would help boost employment.
As Krugman notes:
The answer is, eliminate the capital gains tax. Now, what was the question?

This brings back a memory: on Sept. 13, 2001, I got frantic calls from staffers on Capitol Hill. They informed me that Republican leaders in the House were trying to use the terrorist attack to ram through, you guessed it, a cut in the capital gains tax.
He's
[sic] something you can never forget.
Meanwhile, at a panel discussion with Rich Lowry of National Review, I heard the latest argument against the Employee Free Choice Act: now would be a really bad time to make union organizing easier, because it would hurt business confidence in a recession.

Recession, recovery, whatever: it’s always proof that the Bush years should continue forever.
As I've noted previously:
Folks, when "tax cuts" is THE solution for the economy in all cases - whether it's in dire straits or robust & healthy - then we all oughta be saying, "Hmmmm".

... and, for what it's worth, the folks that are selling us "tax cuts" oughta be labelled as snake-oil salesmen!!!
... The re-emergent anti-union theme is just a nice cherry on top of the sundae! Labor bad! Management good!

I'll re-quote Atrios:
"Damn those unions for destroying Citigroup!!!"
Have a nice day.

I'm thinking Boehner needs econ refresher

"Republican Leader John Boehner of Ohio said he hoped the new administration would listen to those "who do not believe increasing government spending is the best way to put our economy back on track."
[Obama urges Congress to pass costly stimulus bill]

Recall:
GDP = C + I + X + G, with
C = personal/household Consumption,
I = Investment
X = net Exports
G = Government purchases (consumption + investment)
Consumer spending is in the tank & going nowhere but down.
Investment is in the tank and going down.
Exports - until recently a bright spot - are going down.

From where other than "G" does Boehner hope to get GDP going again???

Monday, November 24, 2008

Pre-emptive framing

"This company is dead. I didn't kill it. Don't blame me.
It was dead when I got here."

[Lawrence Garfield (the Danny Devito character), Other People's Money, 1991]
In the days, weeks, months, and years to come, our respected Republican opponents will do whatever they can to pin the messes of Iraq & Afghanistan, and the disaster that is our economy, on Obama and congressional Dems.

We cannot afford to let 'em succeed.

It's time NOW to start repeating - often, frequently, and at every opportunity:
These are W's failed wars.
This is the Republicans' critically ill economy.
For the economy, it wouldn't hurt to pin the blame on the Republicans' Saint Reagan and "supply-side", "trickle-down" economics.

Ridicule can be an effective rhetorical weapon.
Laugh out loud whenever anyone prattles on about the free-market.
Laugh louder whenever anyone advocates "self-regulation" of markets, or of particular industries.

Fearlessly face down your esteemed colleague when he/she attempts to pin any of this on the Dems.
"Excuse me. W and his enablers, including a very vocal Republican congress, got us into these straits. Republican worship of Saint Reagan and his now-debunked trickle-down, anti-regulation economics is to blame for the mess we're in now. Republican ideology got us into Iraq under false pretenses. Republican ideology misgoverned Iraq for over two years - putting ideological purity above basic competence - and allowed the insurgency to flourish. Republican failures of imagination contributed to the attacks on 9/11, and to a blind faith in market self-regulation."
If your respected opponent persists and perhaps suggests that, "Government is never the solution", be prepared!
"Well, yes - I can understand your point of view.
If Republican governance is the standard, then you are, of course, correct.

Government per se is not dysfunctional.
Only Republican government!.

But, a well-run government - the government you will get from President Obama and congressional Dems - is a different story.
We happen to believe that good governance is possible - and we intend to prove it."
Stop the madness (before it begins!).

a "Deep Thought" from Atrios

The Right is - predictably - blaming the UAW for Big 3's woes.

Atrios has a nice rejoinder:
"Damn those unions for destroying Citigroup!!!"
(I'm amazed that Atrios maintains his sense of humor!)

Stop the madness!

One more look at $7.76 trillion

Current population of U.S. ~ 300,000,000.
$7.76 trillion represents just over $25,000 per person.

Now, I've got fairly pricey individual health insurance, running just under $5,000/year.
That $25,000 represents five years of health insurance premiums for me!
(Actually, if I use actual numbers - not rounded - my share of $7.76 trillion is closer to six years of health insurance premiums!)

That $7.76 trillion we're prepared to guarantee...

To help put that $7.76 trillion cited by Bloomberg (U.S. Pledges Top $7.7 Trillion to Ease Frozen Credit) in perspective:
$7.76 trillion supports 155,200,000 median-income households for a year.
[I believe the Census Bureau's current estimate is that there are about 120,000,000 households in the U.S.]

Alternatively, we could give each of the 120,000,000 U.S. households just under $65,000. (If you're a household facing foreclosure, you could use the $65,000 to help get current on your mortgage!... the rest of us could buy stuff or invest the $$$ - "demand-side" economics!!!)

Changing Country Mix in World Market-Cap, posted 20 June 2008, reports that:
"Today, the US market (proxy SPY) has declined to less than 41%" of total WORLD free-float market capitalization.
The total WORLD free-float market capitalization was estimated to be around $30.7 trillion.
41% of $30.7 trillion is about $12.6 trillion.
Since June 2008, the Dow (which I'll use as proxy for U.S. market capitalization) has declined about 30%.
That leaves us with 70% of $12.6 trillion, which is about $8.8 trillion.

(Drum-roll, please!):
With $7.76 trillion the U.S. could buy, outright, close to 90% of outstanding shares in all U.S. companies!!!
[Note: "free-float" represents "freely investable shares. Free-float excludes shares not available for trading, such as government owned shares."]
Pretty cool!

In summary: four yardsticks to help comprehend $7.76 trillion:
1. 50% of U.S. GDP
2. 155,200,000 median-income households (about 30% more households than actually live in the U.S.!)
3. $65,000 for each of the 120,000,000 U.S. households.
4. 90% of shares in publicly traded U.S. companies
Stop the madness!

What??? - (... and how come we can't fund S-CHIP?)

U.S. Pledges Top $7.7 Trillion to Ease Frozen Credit
By Mark Pittman and Bob Ivry
Nov. 24 (Bloomberg) -- The U.S. government is prepared to provide more than $7.76 trillion on behalf of American taxpayers after guaranteeing $306 billion of Citigroup Inc. debt yesterday. The pledges, amounting to half the value of everything produced in the nation last year, are intended to rescue the financial system after the credit markets seized up 15 months ago.

Has anyone suggested we no longer count financial sector $$$ in GDP?

Does this sound slightly askew to anyone but me???

W's legacy - never much to brag about - is getting worse daily.
What'll be left of the U.S. when he's done with us?

Stop the madness!

Thought for the day

Unless things change, they are likely to remain the same.

What "peace" looks like

The surge worked. Violence in Iraq is down.
What's "peace" look like?
Here's a description of Samarra in September, 2008:
"[The First Brigade Combat team] had reinforced a berm - a continuous mound of earth - that surrounded the city, constructed watchtowers for constant surveillance, and set up three check-points through which much of the city's population passed. Samarra was broken into a dozen neighborhoods, each one protected by a perimeter of blast walls."
[Iraq: Before & After, and Now, Joshua Hammer, The New York Review of Books, 4 Dec 2008]
Recall:
Baghdad's highway of death takes on new life
Mar 25, 2008
BAGHDAD (AFP) — The sale in Baghdad of peaked caps boasting "I survived Route Irish" have slumped -- reaching the capital's international airport is no longer the perilous dash it used to be, and the slogan is losing its relevance.
...
"We are turning it into an impregnable security corridor. No one will be able to penetrate it to be able to plant roadside bombs,"
[Police] Colonel Asadi told AFP, while inspecting one of the endless checkpoints set up along the four-lane highway.
Yes - the road is now safe... it is "an impregnable security corridor".

To achieve security, we've turned Iraq into a patchwork of barricaded neighborhoods, walled cities, and impregnable security corridors.

... and we still see headlines like this:
Baghdad bombs kill 20, 1 hits Green Zone entry
... this dated TODAY!

Imagine an American city in which suicide bombers killed 20 people every couple of weeks.

Stop the madness!

Observations (this, that, and t'other)

The U.S. is the only G-8 nation without some form of universal health care.
[Note: G-8 = U.S., Canada, France, Germany, Italy, Japan, Russia, the United Kingdom.]

All but Russia have longer life expectancy than U.S.
Japan: 82.07 yrs (CIA World Factbook); [82.6 (U.N.)]
France: 80.59 yrs; [80.7]
Canada: 80.34 yrs; [80.7]
Italy: 79.94 yrs; [80.5]
Germany: 78.95 yrs; [79.4]
U.K.: 78.70 yrs; [79.4]
U.S.: 78.06 yrs; [78.2]
Russia: 65.87 yrs; [65.5]
Infant mortality? Again, the U.S. trails:
(deaths/1000 live births)
Japan: 2.80 (CIA World Factbook); [3.2 (U.N.)]
France: 3.36; [4.2]
Germany: 4.08; [4.3]
U.K.: 4.93; [4.8]
Canada: 5.08; [4.8]
Italy: 5.61; [5.0]
U.S.: 6.30; [6.3]
Russia: 10.81; [16.6]
Finally, early childhood mortality:
(deaths/1000 live births, children under 5)
Japan: 4.2 (U.N. Population Division)
France: 5.2
Germany: 5.4
Canada: 5.9
U.K.: 6.0
Italy: 6.1
U.S.: 7.8
Russia: 20.9
Maybe if we started calling it "universal health care" - NOT "socialized medicine" - it'd be more appealing to us rugged individualists!

Note to Dems: take care with names. - Names matter!
Recall: the Republicans gave us the "Clean Skies Act" of 2003; the so-called "Patriot Act"; and, long ago, the "Contract with America".
... and, as W reminds us, we don't torture: we use "enhanced interrogation techniques"!

A digression (... oh, heck - this whole post is a digression!):
Perhaps if the 111th Congress moved quickly to enact universal healthcare, they could simultaneously move to save the Big 3 auto makers - eliminating the need for the Big 3 to provide health care benefits to workers & pensioners!

Have fun!

An anniversary I forgot (but meant to remember!)

It's not often one can date with precision - down to the day - the origin of a new word or phrase.

A specific instance that can be precisely dated is the phrase, "drink the kool-aid", which derives from the Jonestown mass murder/suicide on 18 Nov 1978.

The online Urban Dictionary provides three related meanings:
1. One lasting legacy of the Jonestown tragedy is the saying, “Don’t drink the Kool-Aid.” This has come to mean, "Don’t trust any group you find to be a little on the kooky side." or "Whatever they tell you, don't believe it too strongly".

The phrase can also be used in the opposite sense to indicate that one has embraced a particular philosophy or perspective.
Alice: Hey, did you hear that Joe is working on the Nader campaign?
Bob: Yeah, he really drank the Kool-Aid on that one.

Chris: I'm thinking about attending a PETA rally
Donna: Whatever you do, don't drink the Kool-Aid!


2. To completely buy into an idea or system, whether good or bad.
Coach Bellichick got his players to drink the kool-aid.

3. Going along with what a crowd desires. Often used when a person changes positions on a topic.
Dave got a haircut and a new suit. Looks like his company is making him drink the kool-aid.
I note that in my final job before retirement I was often accused of not drinking the kool-aid.

Peace.

Too big to fail

Government unveils bold plan to rescue Citigroup
By JEANNINE AVERSA, AP Economics Writer
24 Nov 2008
WASHINGTON – The government unveiled a bold plan Sunday to rescue Citigroup, injecting a fresh $20 billion into the troubled firm as well as guaranteeing hundreds of billions of dollars in risky assets.

The action, announced jointly by the Treasury Department, the Federal Reserve and the Federal Deposit Insurance Corp., is aimed at shoring up a huge financial institution whose collapse would wreak havoc on the already crippled financial system and the U.S. economy.
...
The $20 billion cash injection by the Treasury Department will come from the $700 billion financial bailout package. The capital infusion follows an earlier one — of $25 billion — in Citigroup in which the government also received an ownership stake.

As part of the plan, Treasury and the FDIC will guarantee against the "possibility of unusually large losses" on up to $306 billion of risky loans and securities backed by commercial and residential mortgages.


Forgive me if I don't get it.
The Big 3 automakers are begging for a $25Bn bridge loan, but Treasury is happy to guarantee losses up to $306Bn for Citi? In addition to a two-part $45Bn direct cash "infusion"???

Perhaps if the Big 3 downplayed their manufacturing role and positioned themselves simply as large financial institutions they'd have better luck.

What did Paulson do before W tapped him for Treasury?
Oh, yeah - he was a Wall Street financier (Goldman-Sachs)!
Guess it helps to have friends in high places.

Note: $25Bn + $20Bn + $306Bn = $351Bn... for Citigroup alone!!!
I thought Paulson was planning to leave $350Bn for Obama.
Oops!

For what it's worth: Milton Friedman was right. Markets DO self-correct. ... it's just that the self-correction can look an awful lot like an economic meltdown! ... no one said free-market capitalism was pretty.

A modest proposal: since we seem willing to provide a safety net to those institutions deemed "too big to fail", can we also impose regulations that will deliberately keep 'em from exploiting us during the "good times", once those return - little things like requirements for cash reserves might be nice. Yeah, I know - this would discourage investment.

Otherwise, next time... If you are not regulated, expect no charity - no matter how big you are.
Give 'em a choice: you don't want regulation? Okay. We allow you to fail. Really. No matter the impact.
You want a safety net? Okay. We get to define new rules for you.

Turns out, there are some conditions attendant to the rescue:
As a condition of the rescue, Citigroup is barred from paying quarterly dividends to shareholders of more than 1 cent a share for three years unless the company obtains consent from the three federal agencies. The bank is currently paying a dividend of 16 cents, halved from a 32-cent payout in the previous quarter. The agreement also places restrictions on executive compensation, including bonuses.

Importantly, the agreement calls on Citigroup to take steps to help distressed homeowners.
Well - it's a start... but I see nothing here suggesting any long-term regulation. Seems Citi'll be able to return to its profligate ways if they survive. Not the outcome I'd hope for.

If nothing else, it'd be nice to see a prohibition against lobbying Congress for the same 3 years as the dividend is restricted.

... and I almost forgot: $350Bn would support 7,000,000 median-income households for a year.

p.s. Now, explain to me again why Paulson can't see his way clear to using some of the $700Bn to provide a $25Bn bridge loan to the auto companies.

Thursday, November 20, 2008

Robotic Complaint Generator

A correspondent provides the following indictment of me, provided by the Robotic Complaint Generator referenced in the heading:
My complaint about Mr. Russ Sype
If you are one of the few who has never been presented with evidence that Mr. Russ Sype plans to instill distrust and thereby create a need for his demonic views, then be glad that the task to educate yourself has just become easy. With this letter, I compile all of the necessary evidence into one easy-to-read document. Let me cut to the chase: Just the other day, some of his contemptible faithfuls forced a prospectus into my hands as I walked past. The prospectus described Mr. Sype's blueprint for a world in which cocky, demented propagandists are free to boss others around. As I dropped the prospectus onto an overflowing wastebasket I reflected upon the way that Mr. Sype likes to imply that granting him complete control over our lives is as important as breathing air. This is what his solutions amount to although, of course, they're daubed over with the viscid slobber of disorganized drivel devised by his expositors and mindlessly multiplied by rotten, obdurate tightwads.

We mustn't be content to patch and darn, to piece and cobble at the worn and rotten fabric of Mr. Sype's blathering, dishonest reports. Instead we must fight on the battleground of ideas for our inalienable individual rights. Mr. Sype's most progressive idea is to bamboozle people into believing that everyone with a different set of beliefs from his is going to get a one-way ticket to Hell. If that sounds progressive to you, you must be facing the wrong way.

I see two problems with Mr. Sype's indiscretions on a very fundamental level. First, mankind, with all of its accumulated knowledge, wonderful machines, scientific methods, and material power, still has much to fear from prissy, judgmental libertines like him. And second, his fabulous success is not firmly connected with meritorious ability. That said, let me continue.

Mr. Sype loves getting up in front of people and telling them that jujuism is a wonderful thing. He then boasts about how he'll force us to bow down low before querulous tricksters in the blink of an eye. It's all part of the media spectacle that is Russ Sype. Of course, he soaks it up and wallows in it like a pig in mud. Speaking of pigs and mud, Mr. Sype is a small part of a large movement that seeks to egg on negative externalities in the form of evasion, collusion, and corruption. Now that's a strong conclusion to draw just from the evidence I've presented in this letter so let me corroborate it by saying that we should hinder the power of sophomoric deadheads like Mr. Sype. (Goodness knows, our elected officials aren't going to.) As another disquieting tidbit the following must be stated: Mr. Sype coins polysyllabic neologisms to make his strictures sound like they're actually important. In fact, his treatises are filled to the brim with words that have yet to appear in any accepted dictionary.

To most people, the idea that Mr. Sype lacks the dim flicker of sentience one needs to qualify as an imbecile is so endemic, so long ingrained, that when others conclude that his bromides are propaganda to the point of comedy and are so easily refuted as to render them useless even as such, this merely seems to be affirming an obvious truth. A central fault line runs through each of his inclinations. Specifically, even his lapdogs, who are legion, are afraid that he will advocate infantile philippics sooner than you think. I have seen their fear manifested over and over again and it is further evidence that I, not being one of the many asinine talebearers of this world, don't care what others say about Mr. Sype. He's still scabrous, snappish, and he intends to sound the standard "they're out to get us" call and rally his spin doctors to elevate his opinions to prominence as epistemological principles. When asked to mend his ways, Mr. Sype will give people a wink and a smile, but when the wheels begin to turn, it's business as usual.

Mr. Sype thinks that his way of life is correct and everyone else's isn't. However, his initiatives would be completely risible if they weren't so wild. It's easy for armchair philosophers to theorize about him and about hypothetical solutions to our Mr. Sype problem. It's an entirely more difficult matter, however, when one considers that the last time I heard him ramble on in his characteristically bibulous blather he said something about wanting to inspire a recrudescence of conniving fatuity. I feel sorry for the human race when I hear stuff like that.

As we all know, Mr. Sype hates me for my determination and my aggressive stance for what is right. I am not fooled by his belligerent and eristic rhetoric. I therefore gladly accept the responsibility of notifying others that if we complain about nutty lie-virtuosi then the sea of masochism, on which Mr. Sype so heavily relies, will begin to dry up. I was, however, going to forget about the whole thing when it suddenly occurred to me that he is not interested in what is true and what is false or in what is good and what is evil. In fact, those distinctions have no meaning to him whatsoever. The only thing that has any meaning to Mr. Sype is irreligionism. Why? That's not a rhetorical question. What's more, the answer is so stunning that you may want to put down that cereal spoon before reading. You see, you may have noticed that Mr. Sype's screeds are a spiritually destructive propaganda instrument aimed at our children. But you don't know the half of it. For starters, I believe I have found my calling. My calling is to maximize our individual potential for effectiveness and success in combatting Mr. Sype. And just let him try and stop me.

Mr. Sype says that truth is merely a social construct. This is noxious falsehood. The truth is that he presents one face to the public, a face that tells people what they want to hear. Then, in private, Mr. Sype devises new schemes to confuse, disorient, and disunify.

Consequently, if a cogent, logical argument entered Mr. Sype's brain, no doubt a concussion would result. Put simply, some day, in the far, far future, Mr. Sype will realize that his general prostration before expansionism confirms that the ineluctable outcome of Mr. Sype's adages is a world in which stolid gadflies conceal information and, occasionally, blatantly lie. This realization will sink in slowly but surely and will be accompanied by a comprehension of how he would have us believe that it's inappropriate to teach children right from wrong. Yeah, right. And I also suppose that Mr. Sype has mystical powers of divination and prophecy? The fact of the matter is that his premise (that his vices are the only true virtues) is his morality disguised as pretended neutrality. Mr. Sype uses this disguised morality to support his sound bites, thereby making his argument self-refuting. Even as I write those words I can feel Mr. Sype cringe. That's okay. Cringe. I don't care because if I have a bias, it is only against sinful guttersnipes who eroticize relations of dominance and subordination.

Well, sure; Mr. Sype is hampered by a load of contradictory and absurd assumptions of the school that he follows, but that doesn't change reality. He should do some research next time before printing half-truths and misinformation. Hence and therefore, Mr. Sype's admirers are hardly strangers to escapism. End of story. Actually, I should add that some people apparently believe that if we don't bother him, he won't bother us. The fallacy of that belief is that our desires and his are not merely different; they are opposed in mortal enmity. Mr. Sype wants to eavesdrop on all sorts of private conversations. We, in contrast, want to alert people that I am not predicting anything specific. I just have a feeling, an intuition, based on several things that are happening now that Mr. Sype will ignite a maelstrom of antagonism one day. That's all for this letter. For those that don't like my views, get over it. I allege that I have as much a right to my views, and to express them, as anyone else. So when I say that uppity tax cheats differ from each other only in the degree to which they create a regime of filthy feudalism, you can agree with me or not. That's all there is to it.
Have a nice day.

An interesting perspective...

I just returned from lunch with former colleague (who is currently Caucasian).
Much of discussion focused on politics & recent election.
He confessed to voting Democratic for the first time ever.
His reason? - Not that he really preferred Obama, but that he thought it would be good for his son - a 2-yr-old - to grow up with an African-American president... in the interest of improving race-relations for future generations, moving the country forward in this respect.

(He also noted that during the last few weeks of the campaign, McCain was looking none-too-competent!... this perception may have made it easier to vote for Obama.)

Have a nice day.

p.s. Former colleague noted that we'll know we have achieved race-neutrality when African-American candidate gets same percent of African-American vote as s/he does overall.

We got another one!

U.S. forces kill Qaeda leader wanted for attacks

Have our military leaders heard of the Hydra?
The Hydra had the body of a serpent and many heads (the number of heads deviates from five up to one hundred there are many versions but generally nine is accepted as standard), of which one could never be harmed by any weapon, and if any of the other heads were severed another would grow in its place (in some versions two would grow).
[Hydra, Encyclopedia Mythica]
I'd bet our military's estimate of the number of AQI leaders aligns well with mythology: between 5 and 100!... I've lost count of how many we've killed, but the total number seems not to have changed.

Why do we still brag about body-counts & "leaders" killed?
These indicators are lousy metrics of true progress.

Stop the madness!

Wednesday, November 19, 2008

the next time...

The next time some Republican spouts off about Obama being Hitler/Stalin in black-face, please ask him or her directly about this:
Files show Md. police watched variety of activists
By BEN NUCKOLS, Associated Press Writer
Wed - Nov 19, 2008
BALTIMORE – Surveillance of anti-death penalty protesters and other activists by the Maryland State Police was broader and went on longer than previously disclosed, according to files that were turned over by police to dozens of activists who were improperly labeled as terrorists.

The files revealed that those labeled as terrorists included environmentalists, peace activists, animal rights activists and some people who have never participated in protests in Maryland.
"... those labeled as terrorists"!!!

... you might also want to remind him or her of the following:
Amendment I
Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof; or abridging the freedom of speech, or of the press; or the right of the people peaceably to assemble, and to petition the government for a redress of grievances.
There is a name for a Government that asserts the right to spy on its own citizens:
Police State
... and it is this REPUBLICAN Administration under W that has delighted in asserting this right!

If folks want to scare you with the spectre of a police state, point out that their fear is legitimate... but it ain't Obama, it's W they oughta fear!!!

Stop the madness.

the other al Qaeda

As you've doubtless heard, the other al Qaeda - the one led by Osama bin Laden that attacked the U.S. on 9/11 - is alive & well and living in Pakistan... and still issuing PR statements.

Today's PR statement from Ayman al-Zawahiri, the real second-in-command (as opposed to one of the several hundred 'second-in-command' folks that we've presumably killed), predictably attacks Prez-elect Obama, declares victory in Iraq (!), and promises continuing anti-U.S. jihad.

Recall - this is one of the guys W promised to get, "dead or alive"... seven (7) years ago!!!

I note that senior al Qaeda folks can release these communiques whenever they want - we don't have a clue where they are or how to get 'em.

John McCain promised that he knew how to get Osama - and suggested on Letterman that what he had in mind was an increased focus on "humint": human intelligence (vs, e.g., signal intelligence). Not a bad idea, but the "how" is a little lacking. Just exactly how did Candidate McCain envisage infiltrating al Qaeda's inner circle???

I've another suggestion... more a 'psy-ops' tactic, really.
Release audio & video communiques from 'al Qaeda' - featuring what for all the world sounds like bin Laden and Ayman al-Zawahiri.
Have the CIA 'authenticate' these messages.
Now the fun part: over some period of time, have these messages from Osama gradually morph from simple calls for jihad against the U.S. into much more extreme, heretical diatribes, with Osama claiming to be Allah's new Prophet.

The idea here is to compel the real Osama to respond... and to respond when we want him to - presumably when we are ready for him.
Be ready to back-track delivery of messages, starting with the courier who delivers the tape to al Jazeera.
Yes, it might take several such messages to discover a more-or-less complete trail back to Osama... but it seems at least plausible - IF we have an idea when a message will be delivered.

The point is to provoke Osama to respond in order to make an educated guess when a message might be delivered.

... and - the plus side - even if we're unable to back-track the delivery route, we will almost certainly accomplish two laudable goals:
1. Plant the seeds of doubt in the Muslim world regarding bin Laden's sanity.
(Mohammed is the final Prophet - for bin Laden to suggest that he is a "new" prophet is extreme heresy.)

2. Perhaps get bin Laden to show his hand - say, for example by increasing signal activity that NSA just might be able to trace.
If nothing else, more frequent communiques from us would dilute Osama's genuine message!

I'd bet a fair amount of $$$ that we have the technical capability to produce "authentic" tapes - both audio & video - of both bin Laden & al-Zawahiri.

Have a nice day.

Returning to my hobby...

What with the election, the campaign, furious (?) blogging, and other distractions, I've been neglecting my hobby: collecting Gilbert&Sullivan-related Victorian trade cards.

I hit eBay last night for the first time in a couple of months, finding nothing - but the hunt is half the fun.

Anyway - assuming AQA has a fairly short life-expectancy - I'll need to find something else to consume time... and trade card collecting (with associated cataloging, filing, displaying) is harmless and fun.

Have a nice day.

Tuesday, November 18, 2008

A fun - perhaps relevant - bulletin-board saying

"Now that we have lost sight of our mission, direction is no longer important.
It's speed that counts!"

"Choices under Uncertainty"

That's part of the subtitle of my favorite book on decision analysis:
Decision Analysis:Introductory Lectures on Choices Under Uncertainty,
by Howard Raiffa
There are lots of books out there with similar titles.

What's more, these books are used in similarly-titled university courses - many of them taught at leading business schools! (Howard Raiffa taught at the Harvard Business School.)
You'd think that SecTreas Paulson & our MBA President would have been exposed to some of this stuff during their academic careers.

The techniques presented in these books and classes are well-known, intellectually robust, and effective.
(Yes, SecTreas Paulson, there are recipes to follow to help draft a playbook when "responding to turmoil we have never faced".)

Why is this fairly straight-forward technology not being used?

Stop the madness!

This sounds very familiar!

From the same article noted below (Paulson Says U.S. Has Turned The Corner In Stabilizing Financial System):
"There is no playbook for responding to turmoil we have never faced," Paulson said in prepared remarks before the House Financial Services Committee.
This has an eerily familiar ring to it. Oh, yeah!
Administration fends off demands for war estimates
Monday, March 3, 2003
WASHINGTON (CNN) -- The number of U.S. troops that would be required to administer Iraq after a U.S.-led military campaign is "not knowable" because of the large number of variables in how a conflict might unfold, Secretary of Defense Donald Rumsfeld said Thursday.

He also said it "makes no sense to try" to come up with cost estimates for a war in Iraq because the variables "create a range that simply isn't useful."
"There is no playbook" - that pretty much sums up the planning for W's Iraq misadventure, too! - We don't know, so we can't plan. These guys are the best & the brightest???

Stop the madness!

p.s. ... and, SecTreas Paulson, not that it's my place to tell you your job, but: isn't it a reasonable expectation that your top priority over the past 2 months ought to have been drafting a playbook???
This calls to mind a time-worn biz adage: "If there’s no time to do it right the first time, when will you find the time to do things over?"

Uh-oh: now I'm really worried!

Paulson Says U.S. Has Turned The Corner In Stabilizing Financial System

Somehow SecTreas Paulson's reassuring words are not reassuring.
The not-so-secret decryption algorithm to decipher the Administration's pronouncements: black = white, etc.
If these guys be fer it, I'm agin it!
If these guys like chocolate, I'll take vanilla, thank you.
Time to go to bed? Must be time to party like crazy!

On the bright side, if Paulson is testifying before Congress, he's not making any hare-brained decisions! Keep him tied up in Committee hearings for another 60 or so days, please.

Stop the madness.

Political nomads

In the final few days of the campaign I took the opportunity to chat with many of the young staffers, who would soon be unemployed and headed out of town (few were New Mexicans).

All of these folks were in their early/mid-20s, and shared similar biographies. Most were Government/PolySci majors. All had worked on other campaigns before joining Heinrich for Congress. In almost all cases, they shared a nomadic lifestyle, moving from one campaign to another. Many of these campaign jobs were little more than whistle-stops, with employment lasting 2-6 weeks. They were all members of an informal network of young campaign workers who somehow learned of new opportunities quickly enough to remain personally solvent. Among the Heinrich for Congress crowd, they'd been doing this for between one and four years - wandering from campaign to campaign. Some had spent their short careers in a single speciality (e.g., finance, communications); others made it a point to work in full spectrum of campaign functions, even tho' this kept 'em forever at the bottom of the experience & payscale ladder. It was not uncommon to hear 'em recite a litany of half-a-dozen jobs held within a 3-6 month period. Most are now looking for their next campaign - with experience on a successful Congressional campaign to add to their resumes.

Most aspired to working on The Hill. Few admitted to aspirations for elected political office.

This is a young person's game - in many respects resembling professional sports (particularly professional baseball - where the players hop from one minor-league team to another, hoping at some point to get invited to "The Show").

A frequent career development path: volunteer -> unpaid intern -> paid intern -> staff -> senior staff.
Make connections along the way.

An interesting nomadic life.

This is why I stopped giving $$$ to DSCC

McCain backer Lieberman keeps committee chair

Back in Dec 2007 I wrote my last check to the DSCC, for $2.71.
("2" is prime; "71" is prime; "271" is prime... and my bet is that it cost more to process the check than its face-value!... tho' DSCC did, in fact, cash it!)
With the check, I sent a note explaining that the current crop of so-called Democratic senators no longer merited my support, as time after time they caved to W on what I viewed as key issues.

We don't need simply more Democrats: we need better Democrats.
With any luck the newly elected freshman class will show more spine than their elders.

Have a nice day.

And now for something completely different...

Long ago, in the dim mists of time, I was a statistics instructor at a large mid-western university.

One summer I taught a graduate stat class.
This was in 1988.
One of my students had paid to watch the Tyson-Spinks bout - a much-hyped contest. The pay-per-view charge was not cheap - too much for my modest means.

Noting the 1st round KO reported during the nightly news, I asked the student, "Was it worth it?"
"To see such an exhibition of power? YES!"

Last night on ESPN I finally got to see what he meant.
The ESPN "Boxing Classics" series featured that 1988 Tyson-Spinks bout.
It was over almost before it began.

I'm glad I didn't spend hard $$$ to see it "live" 20 years ago!

Going Marxist

What are GM's liabilities?
Quickly read articles suggest somewhere in the neighborhood of $200Bn.

That's 4,000,000 households.

If GM went Chapter 7 bankrupt - liquidating everything - and got $0 for its assets, we'd be able to pay 4,000,000 households $50,000 for a year till they found other work for the $200Bn lost.

Does GM employ - directly or indirectly - 4,000,000 people???
I doubt it.

Some of those now-unemployed would be high-paid managers.
They can't make it for a year on $50,000?
The rest of us do it all the time!

Yes - this is just silly. But it helps put things in perspective.

Monday, November 17, 2008

Back to basics: Iraq

McClatchy reports:
Iraq cabinet approves troop agreement with U.S.
Note the wording: "Iraq cabinet."

I call this out only because other news sources reported the same story as:
Iraqi troop accord reached
or
Iraq's government approves security pact with US
Now, in parliamentary systems, "the government" and "the cabinet" are interchangeable...

... but not so in the U.S.
When U.S. citizens read in their newspapers, "Iraq's government approves security pact with US", they think, "Ah - this is a done deal!"

Not so.
The Iraqi Parliament has yet to approve it, which is now required.
Yes - the cabinet agreed to it (it helped that Sen. Obama is now President-elect Obama), but it is NOT a done deal!

Okay - there are a number of riffs to be played on this theme.
I'll focus on two.

1. The SOFA approved by Iraq's cabinet faces serious opposition from Shi'ites... particularly from our creation, Moqtada al-Sadr: Hardline Iraqi cleric bids to kill US pact in parliament.

2. The wording of the pact approved by the cabinet calls for complete withdrawal of American troops by the end of 2011.
W sees it differently:
Press Briefing by Press Secretary Dana Perino
MS. PERINO: As we've been saying since July, when we said that we would work with the Iraqis to establish a date that we would aspire to...

... One of the points that we conceded was that we would establish these aspirational dates.
The negotiated SOFA sets a date. W views this as only "aspirational".

More to follow.

Just for fun: $700Bn & the unemployed

The latest U.S. Labor Dept stats suggest the current unemployment rate is 6.5%, representing 10.08Mn workers.

Expert forecasters (*: implied caveat!) suggest unemployment rate will peak at 7.5% in 2009, which would represent 11.63Mn workers.

That $700Bn rescue package passed in Sep?
That would provide an annual income of $50,000 to 14Mn households.
$50,000 is just slightly higher that the median household income.

I note that 14Mn exceeds 11.63Mn.
Yep - for $700Bn we could support ALL the unemployed for a year (and this is based on a conservative assumption that each one of the "unemployed" represents a single, unique household!)
Would this support provide sufficient stimulus to get the economy back on its feet?
We'll never know.

Have a nice day.

p.s. We could support those 11.63Mn workers with a median household income of $50,000 for only $582Bn!... something less than the $700Bn currently allocated to rescue the financial sector.

Heresy

My ultra-conservative friend (whom I've mentioned several time before) and I share a common view on exactly one topic: gas tax.

Both of us believe that if the U.S. is to be seriously committed to "energy independence", a stiff tax-at-the-pump on gasoline is required.

We've recently experienced the effect of high prices: demand goes down!
(Somehow this shouldn't be a surprise, but it is.)

How to reduce demand? Increase the price.

Yes, this is a horribly regressive tax.
BUT: it has a desired effect!... Well, actually two (2) desired effects:
1. Reduces demand for gasoline
2. Increases government revenue
Please don't hate me!

Artificially make gas cost $5/gal. The difference between $5/gal and market price is pure "profit" to the government.
I note that Europeans have been living with something more than this for years - and somehow they've managed to survive with better overall societal health than us!
(I note that the U.S. lags the European Union in infant mortality on both the CIA World Factbook and U.N. Population Division rankings.)

On this issue at least, I am a progressive heretic.

this, that, and t'other

Do I know how to solve the current economic problems facing us?
No.

That ignorance will not stop me from opining.

First, a book recommendation:
Paper Money, by Adam Smith
[no - not THAT Adam Smith!]
This volume is almost 30 years old, but speaks to today. A quotation:
"We are going to sell America for a product that burns up in the atmosphere."
... speaking, of course, of oil.

Bailout vs Chapter 11 Bankruptcy?
There are a few easy decision rules in the world. My favorite is:
Can't hurt.
Might help.
Costs nothing.
DO IT!
The "bailout vs bankruptcy" dilemma does not fit this paradigm.
BUT: there is another fairly easy decision rule available when faced with an "either/or" decision: do both!
Structure a bailout as if it were a Chapter 11 Bankruptcy.
Honor creditors, but insist on
1. Restructuring
2. New management
GM (as a convenient example) has a good deal of valuable physical infrastructure and intellectual property - simply liquidating these assets may not be the best option. How 'bout we structure a bailout to look like a Chapter 11 bankruptcy?
Equity holders get the shaft (sorry).
GM emerges leaner & meaner - and, with any luck, competitive.

Had the same tactic been adopted with the financials, we'd not be learning that AIG continues to hold executive retreats. We'd not be learning that institutions receiving OUR $$$ continue to pay dividends to shareholders.

New management? As has been pointed out by others, it seems just a little absurd that Secretary of the Treasury Paulson - formerly of Goldman, Sachs - is in charge of the rescue. The folks that got us into this mess with their deification of the "free market" are the same folks now tasked with solving the problem!

This last observation is at the heart of a previous post: let's wait for Team Obama to take the field.
Can we afford to wait?
Can we afford NOT to wait?

This, that, and t'other: Why do firms in dire straits always pay retention bonuses to high-ranking executives? Enron did this. The big finance folks are doing it now.
The argument seems to be something like, "These folks are the best and the brightest. They know the business. We need their expertise."
... no one ever seems to ask the obvious question: "Aren't these best-and-brightest the same folks that got you INTO this mess?"

Many cogent arguments have been advanced against Thomas Kuhn's thesis that new science advances only with new generations of scientists. His paradigm fits some Scientific Revolutions particularly well, but does not fit all cases. (The Structure of Scientific Revolutions, Thomas Kuhn, Third Edition, 1996.)

I'm betting that resolving the current economic crisis does require the infusion of new blood - the next generation of economic wizards. The last generation, led by Milton Friedman, didn't do such a great job. Let's give the neo-Keynesians a shot.

If nothing else, the Reaganite supply-siders & free-marketers have been entirely discredited.
Even the deified Greenspan has admitted that his faith in market "self-regulation" has been undermined.

Why has oil dropped more than 50% in less than half a year?
Drop in demand.
The magicians of Wall Street with all their financial legerdemain couldn't keep the price of oil up forever based on supply.
OPEC is struggling to control oil prices based on supply.
It ain't working.

Free advice to Dems (worth every penny!): whenever one of your opponents mentions "free market" or "self-regulation", break into an uncontrollable, hysterical laugh... make sure that the laughter is directed pointedly at your respected opponent for uttering such nonsense syllables.

Have a nice day.

More forecasts!

Forecasters: U.S. in 14 month recession

Regular readers ought know my opinion of expert forecasters - I once was among 'em!
Whence 14 months? My bet is heavy on fairly brain-dead analysis of past biz cycles, perhaps augmented by less-than-deep analysis of "fundamentals"... Tho' even back-of-the-envelope calculation would suggest that current mess is an "upper tail" event: guessing relatively long duration takes little imagination.

It takes a bit of calculus to do this - but only a bit.
Again: these guys ain't any smarter than us... they just have $$$.

p.s. On the bright side - supposing 14 months to be semi-accurate, this fits well with a tried-and-true "performance evaluation" strategy: start fires in odd quarters, put 'em out in even quarters.
This strategy ensures that semi-annual "performance reviews" will provide the opportunity to brag about putting out fires!
In Prez-elect Obama's case, an economic recovery beginning just over a year from now will give him lots of brownie points for the 2012 election...
It'll also help Senate & Congressional Dems in 2010!

What I learned today...

... well, in fact this lesson has been slowly seeping into my thick skull for the past several days:
Successful Congressional campaigns don't end!
They become permanent campaigns for re-election.

So-o-o... I've been handed two new folders of "database updates needed"!

It's just as well - I wasn't dealing well with the cold-turkey withdrawal from the campaign.

Sunday, November 16, 2008

"Happy Days are Here Again!"

Oil falls below $56 as Japan slips into recession

My single greatest fear at the moment is that the 110th Congress will rush to pass some hare-brained new "rescue" package.
I've no principled objection to Government spending as a valid response to current mess... it's the verb "rush" that terrifies me.
They tried this about two months ago. Other than committing a ton of $$$ ("ton" = $700Bn), that effort accomplished nothing.
Let's not be too hasty to get another costly, ineffective package passed.

Have a nice day.

Oh, this is interesting!

Afghanistan offers Taliban chief safe conduct
President Karzai promises security if Taliban leader agrees to peace talks
Associated Press
Sun., Nov. 16, 2008
KABUL, Afghanistan - Afghan President Hamid Karzai offered Sunday to provide security for the Taliban's reclusive leader if he agrees to enter peace talks, and suggested that the U.S. and other Western nations could leave the country or oust him if they disagree.
...
"If I say I want protection for Mullah Omar, the international community has two choices, remove me or leave if they disagree," Karzai said in an hourlong news conference in Kabul.


Recall:
"THE PRESIDENT: They will try to hide, they will try to avoid the United States and our allies - but we're not going to let them. They run to the hills; they find holes to get in. And we will do whatever it takes to smoke them out and get them running, and we'll get them."
[President Urges Readiness and Patience, Remarks by the President, Secretary of State Colin Powell and Attorney General John Ashcroft; Camp David; Thurmont, Maryland; 15 Sep 2001]
... followed by:
[Mullah] Omar: I am considering two promises. One is the promise of God, the other is that of Bush. The promise of God is that my land is vast. If you start a journey on God's path, you can reside anywhere on this earth and will be protected... The promise of Bush is that there is no place on earth where you can hide that I cannot find you. We will see which one of these two promises is fulfilled."
[Mullah Omar - in his own words, The Guardian, Wednesday September 26 2001]
Looks like Karzai is casting his lot with Mullah Omar.

What will W do?
I'm inclined to add, "Who cares?"... but W does have 60+ days left!
... and, recall:
"... And we will pursue nations that provide aid or safe haven to terrorism. Every nation, in every region, now has a decision to make. Either you are with us, or you are with the terrorists. (Applause.) From this day forward, any nation that continues to harbor or support terrorism will be regarded by the United States as a hostile regime."
[President George W. Bush, Address to a Joint Session of Congress and the American People, 20 Sep 2001]
Will W conclude that Afghan President Karzai has aligned himself with terrorists?

64 Days!

Just out of curiosity...

Wildfires in LA reduce hundreds of homes to ash

So, just out of curiosity:
Will the so-called "religious right" declare that G-d is punishing California for passing Prop 8?
No, I'm not holding my breath.

... but I'm pretty sure they'd have interpreted the fires as G-d's wrath if Prop 8 had been defeated!

Friday, November 14, 2008

Pay-back or Good Government: a personal dilemma

More news today regarding the politicization of DoJ:
New documents show improper conduct, possible jury tampering in Siegelman prosecution.
New documents obtained by TIME magazine show that a U.S. Attorney who recused herself from the prosecution of former Gov. Don Siegelman (D-AL) continued to be actively involved in the case, e-mailing advice to subordinates who were still involved in the prosecution. The documents, provided by DOJ whistleblower Tamarah Grimes, also show “extensive and unusual contact between the prosecution and the jury”:
A key prosecution e-mail describes how jurors repeatedly contacted the government’s legal team during the trial to express, among other things, one juror’s romantic interest in a member of the prosecution team. “The jurors kept sending out messages” via U.S. marshals, the e-mail says, identifying a particular juror as “very interested” in a person who had sat at the prosecution table in court. The same juror was later described reaching out to members of the prosecution team for personal advice about her career and educational plans. […]

Further undisclosed evidence of prosecution team members speaking with jurors following the verdict emerges in Grimes’ written statement to the DoJ. In it, she says a member of the team prosecuting Siegelman had spoken with a juror suspected of improper conduct — apparently at the time the judge was due to question the juror about that conduct. Grimes quotes the lead prosecutor in the case as saying someone had “talked to her. She is just scared and afraid she is going to get in trouble.”
The U.S. Attorney, Leura G. Canary, had recused herself from the case because her husband was a “top GOP operative and close associate of Bush adviser Karl Rove,” who has been accused of orchestrating a political prosecution of Siegelman.

[Artcile lifted in its entirety from Think Progress]
My dilemma?

In saner moments I look forward to the grown-ups taking up the reins of Government, restoring the Constitution as the Law of the Land, and putting policy above politics.

At other times I think, "Hey - W and his minions showed us how it's done. Let's do it to them!" I dream of DoJ pursuing RICO indictments against the RNC and its satellite state parties. I relish the thought of President Obama issuing an Executive Order declaring W and Cheney "enemy combatants" and locking 'em up in a Navy brig for years with no legal recourse. Heck, while he's at it, President Obama could declare Blackwater, KBR, Parsons & Halliburton "sponsors of terrorism" and seize all their assets - payable directly to U.S. Treasury. ("Sponsors of terrorism"??? Sure, why not? USE that expanded "Commander-in-Chief" authority that W labored so diligently to create!)

I'm sort of hoping my saner side wins the argument... but my vindictive alter-ego is still a fun companion.

Thursday, November 13, 2008

Can we wait?

A couple of items suggest maybe we oughta wait till Team Obama takes the field to deal with economic mess.

Today's NYT reports:
U.S. Shifts Focus in Credit Bailout to the Consumer
By EDMUND L. ANDREWS
Published: November 12, 2008
WASHINGTON — The Treasury Department on Wednesday officially abandoned the original strategy behind its $700 billion effort to rescue the financial system, as administration officials acknowledged that banks and financial institutions were as unwilling as ever to lend to consumers.
Meanwhile, we have this encouraging news:
Bush: Economic crisis not a failure of free market
By BEN FELLER, Associated Press Writer
13 Nov 2008
NEW YORK – President George W. Bush asserted Thursday that the global financial crisis is "not a failure of the free market" and urged world leaders to adopt modest financial reforms that stop short of the tighter regulations Europeans favor.

"Our aim should not be more government. It should be smarter government," Bush said during a speech in New York, a day before about two dozen world leaders converge on Washington for a weekend summit he is hosting.
In fact, I agree with W: we need smarter government. Let's wait a couple months to get it!

When the bailout package was rushed through Congress in September, W and his minions assured us that
1. If the bailout wasn't approved immediately the world would come to an end.
2. They knew what they were doing.
Two months later Paulson & the rest of W's minions admit that, gee, it didn't work.

I'll note that in addition to, "Gee, it didn't work", the world has NOT come to an end.

Now we have the brilliant W pronouncing that the problem is "not a failure of the free market".
How can these guys be expected to fix the problem if they don't understand it???

The world will not come to an end in two months.
Some big ("too big to fail") companies may be forced into bankruptcy.
BUT - we'll have a smarter government in place to deal with the fallout!

Let's put the brakes on bailouts for the next two months. These guys are making it up as the they go - not the best way to manage $700Bn of tax-payer money!

Stop the madness.

Our MBA President at work

Bailout Lacks Oversight Despite Billions Pledged
Watchdog Panel Is Empty; Report Is Unfinished
By Amit R. Paley
Washington Post Staff Writer
Thursday, November 13, 2008
In the six weeks since lawmakers approved the Treasury's massive bailout of financial firms, the government has poured money into the country's largest banks, recruited smaller banks into the program and repeatedly widened its scope to cover yet other types of businesses, from insurers to consumer lenders.
...
Yet for all this activity, no formal action has been taken to fill the independent oversight posts established by Congress when it approved the bailout to prevent corruption and government waste. Nor has the first monitoring report required by lawmakers been completed, though the initial deadline has passed.


Did we really expect W and his minions to manage this massive program effectively?
For W and his minions, "oversight" is a dirty word, implying needless Government involvement in what ought to be a ... wait!
This is a Government program!!!
... hmmm. I guess "oversight" just means someone is watching W and his minions to make sure We the People are getting a fair shake. Okay - that would explain why W is loathe to do it!

Stop the madness!!!

Missile Defense. Two words: Maginot Line

US general urges Obama to keep missile defense

Okay, it helps to note that the U.S. general in question is the guy "who runs the Pentagon's missile defense projects".

Assuming - for the sake of argument - that the missile defense system works like a charm (note: this is a huge assumption. In the lastest "test" the Navy shot down only one of two missiles!)... So what?

The Maginot Line worked like a charm!
The Germans never broached it!
They went around!

How were we attacked on 9/11? Commercial airliners.
Would a 100% functioning missile defense system have protected us?
No.

A primitive cruise missile (e.g., a WWII vintage V-1 missile powered by a ramjet engine) launched from a cargo ship off the coast of California or New Jersey could deliver a nuke more effectively than currently non-existent ballistic missiles from Iran or North Korea.

Assuming - again a HUGE assumption - the system worked perfectly, it provides close to 0 protection from attack, at huge cost!
The bad guys can just go around (see, e.g., German invasion of France in WWII).
Maginot Lines DON'T WORK!!!

To quote my favorite military philosopher (perhaps not too accurately - the quotation is lifted from the movie, Patton):
"Fixed fortifications are monuments to the stupidity of man. If anything made by God can be overcome, anything made by man can be overcome."
W's vaunted missile-defense system is simply a high-tech "fixed fortification".

Again, it is helpful to note that the General urging Obama to keep the missile-defense system is the guy in charge of the program!

Stop the madness!!!

A question for Rep. Broun (R-GA)

Recently Rep. Paul Broun (R-GA) made news:
"It may sound a bit crazy and off base, but the thing is, he's the one who proposed this national security force," Rep. Paul Broun said of Obama in an interview Monday with The Associated Press. "I'm just trying to bring attention to the fact that we may - may not, I hope not - but we may have a problem with that type of philosophy of radical socialism or Marxism."

Broun cited a July speech by Obama that has circulated on the Internet in which the then-Democratic presidential candidate called for a civilian force to take some of the national security burden off the military.

"That's exactly what Hitler did in Nazi Germany and it's exactly what the Soviet Union did," Broun said. "When he's proposing to have a national security force that's answering to him, that is as strong as the U.S. military, he's showing me signs of being Marxist."
My question for Congressman Broun:
Where were you and where was your outrage when W and his minions proposed the TIPS (Terrorism Information and Prevention System) program?
Operation TIPS, where the last part is an acronym for the Terrorism Information and Prevention System, was a failed program designed by President George W. Bush to have United States citizens report suspicious activity.
[Wikipedia entry, Operation TIPS]
Where were you and where was your outrage when W's Administration successfully coerced telecom companies into tapping U.S. citizens' phones without warrants?

Where were you and where was your outrage when the so-called Patriot Act authorized National Security Letters in lieu of warrants to obtain information about the activities of U.S. citizens?

Where were you and where was your outrage when MY Government asserted that the Fourth Amendment was a "quaint, historical document"???
There is a name for a nation that asserts the unlimited right to spy on its citizens:
Police State!
And - W's Administration, abetted by Rep. Broun and his Republican colleagues in Congress, are the folks who threaten our liberty!

Stop the madness!!!

Wednesday, November 12, 2008

Alternatives to bailouts

Again, I can draw an implausible inference that folks-in-the-know are reading AQA.
A few posts back I suggested:
I'd really like to see a serious cost/benefit analysis from someone...
What's the likely total cost to "rescue" GM?
Can GM honestly be rescued?
What is the cost of GM failure?
Today's NYT has article suggesting similar point of view:
G.M.’s Troubles Stir Question of Bankruptcy vs. a Bailout
By MICHELINE MAYNARD
Published: November 12, 2008
DETROIT — Momentum is building in Washington for a rescue package for the auto industry to head off a possible bankruptcy filing by General Motors, which is rapidly running low on cash.

But not everyone agrees that a Chapter 11 filing by G.M. would be the disaster that many fear. Some experts note that while bankruptcy would be painful, it may be preferable to a government bailout that may only delay, at considerable cost, the wrenching but necessary steps G.M. needs to take to become a stronger, leaner company.
Yes - there are alternatives to bailouts... Yes, bankruptcy would be painful... BUT: what are the relative risks involved?

If a bailout simply postpones the inevitable ("Can GM honestly be rescued?"), getting the worst over with quickly might be the cost-effective path to take.

Atrios over at Eschaton raises similar issues:
"I don't know for sure that just letting GM filing for bankruptcy is the best route, but if it isn't then it just means there's something wrong with our bankruptcy laws and/or our dealings with "too big to fail" companies.
...
The system needs to have standard ways of dealing with these things. If the ones in place don't work, we need new ones, not free money for failures."
I note that Atrios is one of the folks who anticipated the current crisis many many moons ago, for over a year referring to mortgage-backed securities as "big shitpile".

Have a nice day.

My latest email to Sen. Jeff Bingaman (D-NM)

Do our elected representatives understand the current economic mess well enough to draft effective legislation to deal with it?
I doubt it.

This thought inspired my most recent email to New Mexico's senior Senator:
Senator Bingaman:
Before the Senate votes on the next bail-out package, would you and your Democratic colleagues be willing to invest an afternoon to become better informed regarding business, finance, and economics?

No, I'm not selling anything. I am one of your New Mexico constituents whose knowledge of business, finance, and economics can be written in big block letters on a postage stamp.

But, there are knowledgeable people out there.
One such fellow, William A. (Bill) Ackman, was on Charlie Rose today, speaking in very simple terms about the current economic and financial crisis.
Mr. Ackman is the Harvard-educated CEO of Pershing Square Capital Management, L.P.

I note that AIG executives are still taking retreats on the tax-payer's dime.
Most large businesses require annual training for their employees - including senior executives.
I suggest only that the Senate Democratic Caucus follow this example and schedule an off-site training session with Mr. Ackman or some other well-qualified expert. I suspect a 4-hour short course presented by Mr. Ackman would help you deal with the current economic crisis as effectively and efficiently as possible.

Mr. Ackman can be reached at Pershing Square Capital Management:
Phone: 212-813-3700
Fax: 212-419-2341
Corporate headquarters:
888 Seventh Avenue
New York, New York 10019
I've no idea if Mr. Ackman would be willing to provide a 4-hour short-course for the Senate Democratic Caucus, but he did take the time to prepare a brief presentation for Secretary of Treasury Paulson (delivered electronically), so he just might be interested in helping members of Congress better understand the current crisis and his views on how to resolve it.

This is a serious suggestion!
If not Mr. Ackman, please - get a quick tutorial from somebody!

Have a nice day.

Back at the campaign (???)

... but... But... the election is over!

True enough... but there is one final mailing: 'thank you' letters to all supporters!

In prep for this I spent several hours cleaning bad addresses and merging duplicate records.

Yesterday & today: the fruit of my labor - the FINAL mailing!
Hooray!!!

Tuesday, November 11, 2008

An interesting suggestion

One of my correspondents writes:
......instead of the Washington boys giving away our money to GM and other big boys.....why not give, let's say, ten thousand dollars. To every American household with the stipulation that the money must be spent on durable American products within a 12 month period, and proof of purchase must be supplied to the IRS at tax time. Any money not spent has to be returned to the IRS along with your tax obligation. I'm sure this sort of plan would cost less, give the people who own the money use of it, and promote American industries that need the input of dollars to keep the economy going.
Note: the current $700Bn package would provide $10,000 to 70,000,000 households. (The Census Bureau's Current Population Survey reports about 117,000,000 households in 2007. 70,000,000 is about 60% of 'em.)

If you like the idea, my correspondent had a couple of suggestions:
1. Pass this idea along to all the folks on your email list and see what happens.
2. Send it to Washington too.
It's very rewarding - at least on a personal level - to write a letter to your Congressman and your Senators.

Have a nice day.

a fun forecasting quotation

The following quotation is poorly attested, but fun:
"Prediction is very difficult, especially about the future."
[attributed variously to Niels Bohr - Nobel Prize-winning physicist... or to Yogi Berra, NY Yankees catcher!]

Martingales

Semi-technical definition:
In probability theory, a martingale is a stochastic process (i.e., a sequence of random variables) such that the conditional expected value of an observation at some time t, given all the observations up to some earlier time s, is equal to the observation at that earlier time s.
[Wikipedia, ]
A martingale forecasting model is very simple: Tomorrow will look like today.

What brings this to mind is this headline:
U.S. economy expected to contract in 2009
The article notes that, "The U.S. economy is expected to shrink 0.4% in 2009 compared with 2008, according to the monthly survey of 49 economists published Monday by Blue Chip Economic Indicators."

Yep - the economy went down yesterday, so the forecast is that it'll go down tomorrow.

Recall last spring and early summer, when oil was headed upwards of $140/bbl, the economic sages were suggesting that it could go as high as $200/bbl. (It's currently hovering around the low $60s/bbl.)

Numerous academic studies over the past 30+ years confirm that the best guess for tomorrow's stock price is today's stock price.

All economic forecasting based on anything more sophisticated than reading tea leaves or asking grandma is based on the assumption that "the future will look like the past." The differences between the myriad models out there is just which aspects of the past will be repeated, and just what constitutes the relevant past.

Recent economic projections (say, those made over the past year or so) all seem to suggest that "rate of change" is the dimension of past behavior most favored by forecasters, and that "yesterday" is the relevant past. That is, many - if not most - of the forecasts that have made the news in the past year seem to be based on a pretty simple model: the best guess for how tomorrow will look is based on assuming that the rate-of-change from today-to-tomorrow will be the same as the rate-of-change from yesterday-to-today. A martingale on rates-of-change.

Readers may notice a flaw in this methodology: it cannot predict a change in direction. As it turns out, there just aren't any good models in use that do a decent job guessing when 'up' will turn to 'down' or vice versa.
[Aside: a none-too-sophisticated analysis of recession frequency since WWII led me to predict (as part of my job as a forecaster) in Dec 2006 that there was better than an 80% chance of recession before 2010. When would it start? My none-too-sophisticated model didn't provide a guess.]

I believe I have just equipped my readers to forecast the economy at least as accurately as many of the high-paid economic gurus: tomorrow will look like today!

Aside: martingale forecasting is a purely statistical procedure, which takes into account nothing about economic 'fundamentals'. Economists like Krugman did a pretty good job suggesting more than a year ago that 'up' would soon turn to 'down' based on an analysis of these fundamentals.

... but most folks are happy to let their computer models do the thinking. And academic research over the past 30 years continues to affirm that, if you're letting your computer models do the work, the best model around is also the simplest: tomorrow will look like today.

Have a nice day.

Monday, November 10, 2008

Kenny Rogers: political philsopher

My turn to join in the ever-expanding chorus of folks offering President-elect Obama advice.
My advice isn't related to policy, but to process.

Kenny Rogers had some good advice:
You got to know when to hold em, know when to fold em,
Know when to walk away and know when to run.

[Kenny Rogers, The Gambler]
I've in mind a few specific situations requiring this counsel:
foreign policy
Iraq
Afghanistan
Bailout
AIG
General Motors
Focusing on the economic/bailout cases: what informs the decision? (Hold 'em, fold 'em, walk away, run?)

I'd really like to see a serious cost/benefit analysis from someone - GAO, CBO? (Independent analysis preferred!)
We're already seeing that the original bailout of AIG has failed - even tho' it was deemed more than sufficient at the time.
How much more is likely to be needed to keep AIG afloat?
Will any amount be sufficient?
What would be the effect of AIG failure? (I note that we have a smaller case-study available: Lehman. The world did not come to an end; the market really did quickly manage to value Lehman's assets.)

Same analysis for GM: What's the likely total cost to "rescue" GM?
Can GM honestly be rescued?
What is the cost of GM failure?

One component of "cost of rescue" is opportunity loss: What else could be done with the $$$?
Would the proposed $$$ be better spent mitigating the effects of failure?

If I start quoting Hank Williams, it's probably time to stop reading AQA.

AIG: Deja vu all over again

Today:
Government provides record aid package to AIG
By JEANNINE AVERSA, AP Economics Writer Jeannine Aversa, Ap Economics Writer
10 Nov 2008
WASHINGTON – In a record bailout of a private company, the government on Monday provided a new $150 billion financial-rescue package to troubled insurance giant American International Group, including $40 billion for partial ownership.

The action, announced by the Federal Reserve and the Treasury Department, was taken as it became increasingly clear that an original financial lifeline thrown to AIG in September would be insufficient to stabilize the teetering company.
Was there warning?

Yes (but you'd never know it from reading the article):
Concerns rise as AIG blows through 70% of government cash
No asset sales yet, so insurer continues to tap securities lending facility; ‘you’ve got to draw the line’
By Beth Braverman
Financial Week
October 24, 2008
American International Group tapped its securities lending facility with the New York Fed this week for another $7 billion, but it did not draw down any more of the $85 billion bridge loan it received in September, also from the New York Fed.

As of Thursday, AIG had borrowed $72 billion under the bridge loan (that amount has remained constant since Oct. 9), $18 billion under its securities lending facility and $300 million in capitalized interest, according to company spokesman Peter Tulupman. In total, the company had tapped more than 70% of its available credit.
This sounds eerily familiar.

Recall (long distant past): November 2001. As part of a proposed deal to acquire Enron, Dynergy injects $1.5Bn into Enron. Shortly thereafter Enron - at the SEC's insistence - publishes 10-Q quarterly report. The report reveals that:
Enron has blown through the $1.5Bn, and can't say how;
Enron revealed it would have ~$2Bn payment due by end of year;
Enron is technically insolvent: immediate obligations ~ $2.8Bn; $1.2Bn cash on hand.
[Details derived from Kurt Echenwald's Conspiracy of Fools.]
Only the scale is different... vastly different. $1.5Bn (Enron) vs $90Bn (AIG).

The need for re-doing the AIG deal is never really made clear in the article, other than to say that interest payments on the Govt loan were depleting all AIG's cash. Where'd the principal go?

This doesn't sound promising.

Maybe they're reading AQA!

Pentagon board says cuts essential
Tells Obama to slash large weapons programs
By Bryan Bender
[Boston] Globe Staff / November 10, 2008
WASHINGTON - A senior Pentagon advisory group, in a series of bluntly worded briefings, is warning President-elect Barack Obama that the Defense Department's current budget is "not sustainable," and he must scale back or eliminate some of the military's most prized weapons programs.

The briefings were prepared by the Defense Business Board, an internal management oversight body. It contends that the nation's recent financial crisis makes it imperative that the Pentagon and Congress slash some of the nation's most costly and troubled weapons to ensure they can finance the military's most pressing priorities.

Those include rebuilding ground forces battered by multiple tours to Iraq and Afghanistan and expanding the ranks to wage the war on terrorism.


Wow! AQA regulars will recognize in these proposals many elements I've championed previously, as I've railed against the Pentagon's addiction to high-tech weapons systems at the expense of boots on the ground & basic support for troops.

Of course, any attempt to impose sanity on our Defense budget will be met with cries of "weak-on-national-defense" from the so-called loyal opposition. Obama will need to market this carefully.

... which brings us to a larger point:
The Dems need to communicate better than they have in the past to counter easily anticipated Republican rage. This applies not only to defense spending, but to a wide range of policy issues.

The Republicans have successfully used the "tax-and-spend liberal" tag for decades without having to worry that the Dems will formulate a consistent convincing retort.

Republicans have succeeded in making "liberal" a dirty word.

Any mention of cutting Defense spending will almost certainly meet with "weak on national security" accusations.

Me? I'm drafting a brief proposal for my Congressman-elect, suggesting that the 110th Congress freshman class could make a name for itself by drafting a clear set of principles & policies to help sell the progressive agenda - and to counter the easily anticipated Republicans attacks on any such agenda.

Have a nice day.

Sunday, November 9, 2008

As we near the season of "Goodwill toward men"

You could make this stuff up, but there's no need:
Monks brawl at Christian holy site in Jerusalem
By MATTI FRIEDMAN, Associated Press Writer
9 Nov 2008
JERUSALEM – Israeli police rushed into one of Christianity's holiest churches Sunday and arrested two clergyman after an argument between monks erupted into a brawl next to the site of Jesus' tomb.

The clash between Armenian and Greek Orthodox monks broke out in the Church of the Holy Sepulcher, revered as the site of Jesus' crucifixion, burial and resurrection.
This is not a unique event at the Church of the Holy Sepulcher.
Since the renovation of 1555, control of the church oscillated between the Franciscans and the Orthodox, depending on which community could obtain a favorable firman from the Sublime Porte at a particular time, often through outright bribery, and violent clashes were not uncommon. In 1767, weary of the squabbling, the Porte issued a firman that divided the church among the claimants. This was confirmed in 1852 with another firman that made the arrangement permanent, establishing a status quo of territorial division among the communities.

The primary custodians are the Eastern Orthodox, Armenian Apostolic, and Roman Catholic Churches, with the Greek Orthodox Church having the lion's share. In the 19th century, the Coptic Orthodox, the Ethiopian Orthodox and the Syriac Orthodox acquired lesser responsibilities, which include shrines and other structures within and around the building. Times and places of worship for each community are strictly regulated in common areas.

Establishment of the status quo did not halt the violence, which continues to break out every so often even in modern times. On a hot summer day in 2002, the Coptic monk who is stationed on the roof to express Coptic claims to the Ethiopian territory there moved his chair from its agreed spot into the shade. This was interpreted as a hostile move by the Ethiopians, and eleven were hospitalized after the resulting fracas.

In another incident in 2004 during Orthodox celebrations of the Exaltation of the Holy Cross, a door to the Franciscan chapel was left open. This was taken as a sign of disrespect by the Orthodox and a fistfight broke out. Some people were arrested, but no one was seriously injured.

On Palm Sunday, in April 2008, a brawl broke out due to a Greek monk being ejected from the building by a rival faction. Police were called to the scene but were also attacked by the enraged brawlers. [13] In November 2008, a clash erupted between Armenian and Greek Orthodox monks.


Under the status quo, no part of what is designated as common territory may be so much as rearranged without consent from all communities. This often leads to the neglect of badly needed repairs when the communities cannot come to an agreement among themselves about the final shape of a project. Just such a disagreement has delayed the renovation of the edicule, where the need is now dire, but also where any change in the structure might result in a change to the status quo disagreeable to one or more of the communities.

[Wikipedia article, Church of the Holy Sepulchre]
It's not clear to me how the West hopes to achieve mutual tolerance among Christians, Jews, and Muslims when various flavors of Christians cannot jointly govern what they believe to be one of the most sacred Christian sites.

Have a nice day.

Saturday, November 8, 2008

No, I'm not alone

A few posts ago I noted that, tho' I enjoy reading all the dirt on Gov. Palin, I question the self-preservation instincts of the folks peddling the stories. By peddling all this fun stuff, the peddlers are indicting themselves: they picked her!

Someone else noticed: CNN's Campbell Brown, on her No Bias, No Bull show:
You are the ones who supposedly vetted her, and then told the American people she was qualified for the job. You are the ones who after meeting her a couple of times, told us she was ready to be just one heartbeat away from the Presidency. If even half of what you say NOW is true, then boy, did you try to sell the American people a bill of goods. If Sarah Palin is the reason some voters chose Barack Obama, that is no one's fault but your own. John McCain, as he so graciously said himself the other night, lost this election. He lost it with your help, your advice, your guidance, and yes, your running mate recommendations. And that is crystal clear to everyone, no matter how hard you try to blame Sarah Palin or anyone else.
It's so nice to see my views validated by an independent third-party.

Have a nice day.

Ted Rall's good idea (again!)

In light of W's latest brilliance - restricting outpatient Medicaid services - it seems appropriate to remind folks of Ted Rall's Good Idea.
[Originally posted 7 Dec 2007]
Trim Bush from American History
"... Let's begin America's long slog toward moral and political redemption by demanding that our next president's first act be to declare the Bush Administration null and void. Every law and act carried out between 12 noon on January 20, 2001 and January 20, 2009 should just...go...poof. ..."
If WaPo is right, President-elect Obama is already on board:
Obama Positioned to Quickly Reverse Bush Actions
Stem Cell, Climate Rules Among Targets of President-Elect's Team
By Ceci Connolly and R. Jeffrey Smith
Washington Post Staff Writers
Sunday, November 9, 2008; Page A16
Transition advisers to President-elect Barack Obama have compiled a list of about 200 Bush administration actions and executive orders that could be swiftly undone to reverse White House policies on climate change, stem cell research, reproductive rights and other issues, according to congressional Democrats, campaign aides and experts working with the transition team.
Could President Obama go too far?

How??? If W touched it, it's poison - get rid of it!

Stop the madness!!!

W: the gift that keeps on giving

The following is wrong on so many levels:
New U.S. Rule Pares Outpatient Medicaid Services
By ROBERT PEAR, NYT
November 7, 2008
WASHINGTON — In the first of an expected avalanche of post-election regulations, the Bush administration on Friday narrowed the scope of services that can be provided to poor people under Medicaid’s outpatient hospital benefit.
...
In a notice published Friday in the Federal Register, the Bush administration said it had to clarify the definition of outpatient hospital services because the current ambiguity had allowed states to claim excessive payments.

“This rule represents a new initiative to preserve the fiscal integrity of the Medicaid program,” the notice said.
Where to start?

Humanitarian: Recall W's concept of "universal health care":
"I mean, people have access to health care in America. After all, you just go to an emergency room."
[President Bush Visits Cleveland, Ohio, 10 Jul 2007]
Apparently even this limited definition of "access" was too broad for W.

Economic: Actually, there are two legitimate criticisms of the new policy from an economic perspective.

First: This is NOT the time to start observing "fiscal discipline". The country is in recession, and possibly is teetering on the edge of the big D - Depression. As others more economically astute than I (e.g, here and here) have observed, textbook Keynesian theory suggests now is the time for the Federal Government to spend... and not just give billions of $$$ to the banks! (Tho' I've yet to find the original source of the term, "neo-Hooverism" is an entirely accurate description of W's new-found fiscal discipline!)

Second, as the NYT article notes, in the current economic climate the States are struggling and haven't the wherewithal to provide the lost services. (Ah - but that is the States' problem - not W's!) Again - this sudden penny-wise behavior is very definitely pound-foolish!

W restricts access to medical care in order to secure illusory budget "savings"! What a wonderful commentary on his Presidency!

Stop the madness!

Friday, November 7, 2008

Uh-oh: this could be trouble!

President George W. Bush today delivered his second very gracious speech in two days:
President Bush Discusses the Transition with Employees of the Executive Office of the President
Unfortunately this address included the following promise:
This peaceful transfer of power is one of the hallmarks of a true democracy. And ensuring that this transition is as smooth as possible is a priority for the rest of my presidency.
When President Bush makes something a "priority" of his presidency, somehow that something just never quite works out!

Catching Osama bin Laden was a priority.
Bringing stability to Iraq was a priority.
More recently, getting an Israeli-Palestinian peace plan in place was a priority.

We can only hope that the peaceful transfer of power will occur as planned - despite it being a priority!

Have a nice day.