Thursday, April 30, 2009
Then, after the binge, no one can afford to eat (or live) anymore.
Our automobile industry could be much more “American” if we really cared to make it so. But we don’t. Our behavior as investors and consumers is usually more rational than the claims we offer up in politics and in public discourse.--Tyler Cowen
We're Living In Odd Times When Miss California Gets Tougher Questions Than the President.--Dennis Miller
It's the Spock plot strands that give the new "Trek" its best shot at once again commanding the zeitgeist. Spock's cool, analytical nature feels more fascinating and topical than ever now that we've put a sort of Vulcan in the White House.--Steve Daly
I grew up on 'Star Trek'—I believe in the final frontier.--Barack Obama
The interesting caveat is [the Obama sensation] is a style of leadership more effective running a law review than running a country.--Ron Klain
But in a still-dangerous world, in which one's listeners now have names like Ahmadinejad, Kim Jong Il, Putin, Hu Jintao, Netanyahu, Sarkozy and Merkel, the costs for the rest of us of being "misinterpreted" for a compulsive lack of clarity could be high. As back in January 2007, the key question remains: Is this Hamlet-like style of leadership suited for conducting the presidency of the United States? More bluntly, is it leadership? As he heads towards the next 1,300 days, Mr. Obama might consider trying a different gift that served an earlier Democratic president, Harry Truman, quite well once in office: Plain speaking.--Daniel Henninger
[Jon Stewart] is certainly not the only American who would take that view [that dropping the atomic bomb on Hiroshima is a war crime], but it's a useful reminder that the most vocal and popular criticism of the Bush administration's war on terror policies comes from people who, if they were being as honest as Stewart, would also judge Lincoln (suspension of habeas), FDR (internment), and Truman (use of nuclear weapons) as war criminals or tyrants or worse.--Michael Goldfarb
I see these “revise and extend” stories most every time they let Biden out in front of the cameras.--Stephen Green
Jake, I understand what [Joe Biden] said. And I'm telling you what he meant to say.--Robert Gibbs, President Obama's press secretary
[Bill Clinton] is a fan of this [10 girls for every 1 guy] ratio.--Nouriel Roubini
Wednesday, April 29, 2009
I intend to propose a rule change which would preclude a future recurrence of a Senator’s change in parties, in midsession, organizing with the opposition, to cause the upheaval which is now resulting.--Arlen Specter, in 2001 during Jim Jeffords' party switch
Free-market dynamics have worked in virtually every other part of the economy, spurring production and innovation and helping us get more for less. Food is even more basic than health care. We don't have a third-party-payer system for food (except for food stamps). Result: Today people spend a smaller portion of their income for food than they did decades ago. And the variety of foods is greater than ever. Free markets can do the same with regard to health care; governments manifestly cannot.--Steve Forbes
Before you can torture anyone, you must first torture the law. When that happens, we are all on the rack.--Richard Cohen
To appreciate credit cards, it is worth recalling that before they came along, people got personal loans from banks, finance companies, pawnshops and loan sharks. Such loans were less convenient, and repayment was less flexible. Some people bought things on layaway, which meant they didn't take the goods home until they were paid for. Loan sharks sometimes broke people's legs.
Credit cards didn't create consumer debt -- they are merely a superior alternative to older methods.
As President Obama and other politicians demagogue this issue, keep two things in mind: Life would be more difficult without credit cards, and banks don't have to keep issuing them. Be careful what you ask for
I've never understood how the poor are helped by limiting their choices.
Hey, John, maybe those politicians promising to help the poor are more interested in helping themselves.
Stock prices are, by necessity, single numbers at any point in time, but reflect the estimate of probabilistic futures. If I am holding a sealed box that has an equal probability of holding $10 or $30, the selling price of the box will be $20 right now, and after being opened there will be either an immediate 50% drop or an immediate 50% rise in price. The pricing was rational throughout, even though a radical change in price occurred after opening the box.
In 1987, there is some evidence that major moves were associated with the surprise introduction into a Congressional committee of legislation to make mergers much less favorable from a tax point of view, and activity the week of the crash could well be correlated with the best guess of the outcome. The fact that the legislation was withdrawn after (and perhaps as a result of) the crash could explain the absence of follow up and the recovery of the market.
We need a paradigm shift from the status quo. Vouchers anyone; anyone? Nah, that would give students and their families too much choice.
High school lack of progress reported here:
U.S. high-school students haven't achieved any significant gains in reading or math for nearly four decades, according to a new federal report that underscores the challenges the Obama administration faces as it pressures schools to raise standards to produce a more competitive work force....
On a zero-to-500-point scale, 17-year-olds scored an average of 286 points in reading in 2008, up one point from 1971. The NAEP report said students with such scores have "intermediate skills" and are able to make generalizations about what they read.
In math, the same group's average scores rose two points to 306 since 1973. The report said students scoring in that range are able to perform moderately complex procedures such as computing with decimals and simple fractions.
Spending tracked here:
Tuesday, April 28, 2009
So a 10% increase in parents’ income raises children’s income by 2%, but a 10% increase in parents’ test scores raises children’s test scores by 4.5%.
UPDATE: Via Jim Harper, a retrospective at Gawker (of all places!)
Isn’t Obama looking for ways to cut $100 million from the budget? What did this photo op cost? $25-50-$100K?
I know it takes a million dollars to get a fighter aircraft off the ground, and another million dollars per hour to keep it in the air. I think Air Force One might be an order of magnitude more than that.
The Gans family solved the problem for Child No. 3 by outsourcing potty training to daycare. If only we could do the same for Wall Street ...--Tim Harford
Scooter Libby went to prison for the "outing" of a desk-jockey CIA agent. He forgot conversations. Pelosi forgets briefings. And the outing of our entire intelligence apparatus by Democrats is OK.--IBD Editorial Board
Watching Dick Cheney defend the Bush administration’s interrogation policies, it’s been hard to escape the impression that both the Republican Party and the country would be better off today if Cheney, rather than John McCain, had been a candidate for president in 2008.--Ross Douthat
Mediocre people have an answer for everything and are astonished at nothing-- Eugène Delacroix
The ACLU began describing itself as a 'social justice organization,' and its non-partisan commitment to civil liberty shrank -- especially its commitment to free speech -- while its vision of equality expanded.--Wendy Kaminer
Of course [pianist Krystian] Zimerman, who is certainly old enough to have played the piano while Poland was under the totalitarian control of the USSR apparently never said a word at the time about the country that actually had "hands" on his country and controlled it completely, but instead blithely played on. The primary reason he's free to travel and insult this country is because our military stood in opposition to the USSR along the Iron Curtain for decades and faced down his real oppressor.--Bruce McQuain
You can run a farm or factory in relatively primitive societies. But the protection of intellectual property—of products as flimsy as sung words and crotchets and quavers—requires the most evolved form of capitalist society. The aristorockracy are the last people who want a revolution. Africa should do as Bono does, not as he says.--Mark Steyn
The selling of the green economy involves much economic make-believe. Environmentalists not only maximize the dangers of global warming -- from rising sea levels to advancing tropical diseases -- they also minimize the costs of dealing with it. Actually, no one involved in this debate really knows what the consequences or costs might be. All are inferred from models of uncertain reliability. Great schemes of economic and social engineering are proposed on shaky foundations of knowledge. Candor and common sense are in scarce supply.--Robert Samuelson
But, of course, attributing to Arlen Specter a coherent or consistent “political philosophy” is giving him more credit than he has ever deserved. Specter, who originally switched in from being a lifelong Democrat to a Republican in a 1965 move to be elected Philadelphia’s district attorney, is the quintessential opportunist.--Jonathan Tobin
If we lose my seat they have 60 Democrats, they will pass card check, you will have the Obama tax increases, they will carry out his big spending plans. So the 41st Republican, whose name is Arlen Specter is vital to stopping tax increases, passage of card check, and the Obama big spending plans....Those 41 seats are the only thing standing between a Democratic onslaught of higher taxes, more spending and card check.--Arlen Specter, just a couple of weeks ago
I'd say [Bill Belichick is] like the Hunchback of Notre Dame without the face and the hunchback. Rough exterior, but he has a kind heart and he means well. He just goes about it differently.--Ellis Hobbs
This is what his senior economic adviser, Austan Goolsbee, says:
When the Soviet Union launched Sputnik a little more than a half century ago, Americans were stunned. The Russians had beaten us to space. And we had to make a choice: We could accept defeat or we could accept the challenge. And as always, we chose to accept the challenge.
President Eisenhower signed legislation to create NASA and to invest in science and math education, from grade school to graduate school. And just a few years later, a month after his address to the 1961 Annual Meeting of the National Academy of Sciences, President Kennedy boldly declared before a joint session of Congress that the United States would send a man to the moon and return him safely to the Earth.
... there is a serious problem with such government efforts to increase inventive activity. The majority of R&D spending is actually just salary payments for R&D workers. Their labor supply, however, is quite inelastic so when the government funds R&D, a significant fraction of the increased spending goes directly into higher wages. ... The results also imply that by altering the wages of scientists and engineers even for firms not receiving federal support, government funding directly crowds out private inventive activity.(Via Greg Mankiw)
Monday, April 27, 2009
Previous MBA spankdown here.
They had Donald Brown and Clay Matthews right there for them. That surprised me. I thought a running back was something they would target. And I certainly thought a young outside linebacker like Matthews with the bloodlines and all that was somebody they would target, they didn’t. That’s just my opinion. Obviously, they thought otherwise.I think, given the rookie pay scale against the salary cap, it just might be worth paying 60% in the second or third round for someone who is 95% as good as a first rounder.
But hey, I've never had to go and try to win a Super Bowl. (Unlike Mel Kiper?)
Here is the team's first pick, 34th overall, 212-lb safety Patrick Chung, #15 and wearing white, who you can see knocking down a 313-lb lineman and then a 296-lb lineman within 3 seconds of each other. He enters the frame on the upper left side, about 9 seconds in.
UPDATE: Here is Ron Borges' take:
NFL Players Association figures indicate in 2008 a first-round pick’s average guaranteed money was $11,924,000, including base salary, signing, roster and option bonuses. A second-round pick averaged $1,932,000 in guarantees. Those numbers are skewed some because of the presence of a quarterback like Matt Ryan near the top of the draft but they still are a reasonable measuring stick for analysis and what they say is that for roughly $4 million less than what the average first-round pick got a year ago, the Patriots got four second-round players.
Universal healthcare is neither universal, nor about healthcare. It's just about driving costs down on everyone, by taking healthcare away from everyone.
BCWUW4: Be Careful What You Wish For.
The lesson of Jobs’s ouster and redemption is twofold. First, never count anyone out — certainly not anyone as determined and intelligent as Jobs. In pulling off one of the greatest second acts in American business, he has not merely confounded his critics, he has induced mass amnesia. Second, savor authenticity. The Jobs who led the Macintosh crew in 1984 was self-centered, imperious, arrogant, unyielding, and flawed in myriad other ways — but more importantly, he had genuine passion and the crucial ability to instill it in others. This made him far more compelling and ultimately more successful than the string of glossy-tongued managers who followed. Rough edges, it turns out, are there for a reason.
From personal experience, may I say that the first 5 traits are much easier to acheive than the last two?
Military jets chasing commercial jet buzz my neighborhood:
The Federal Aviation Administration confirmed that two F-16s escorting a Boeing 747 -- which CBS 2 confirmed is also used as an Air Force One -- were part of the Department of Defense photo shoot.
UPDATE: Erin Burnett on CNBC reporting that Mayor Bloomberg is furious. Good. I'm thinking he would make a better President than some.
UPDATE: WSJ has a compilation of video.
UPDATE: I want some butts!!! At least one.
1. Sweden.Under-acheivers also listed at the link.
With a population of only 9 million, one wouldn’t expect Sweden to cast much of a shadow, despite its advanced industrial economy. Yet for its size and population, Sweden has been a significant international player. Its welfare state and other social policies have been widely-studied and a model for others, and diplomats such as Dag Hammarskjold, Folke Bernadotte, and Olof Palme were all important international voices. Sweden still devotes a higher percentage of its GDP to foreign aid than any other country, and institutions such as the Stockholm International Peace Research Institute have amplified Sweden's visibility on major issues of arms control and disarmament. Awarding the Nobel Prizes probably doesn't hurt either.
2. North Korea.
With a small population (22 million), an obsolete military machine, a bankrupt ideology, and an economy that exposes its citizens to periodic famine, one wouldn’t expect North Korea to get much attention at all. Indeed, on most measures North Korea is an under-achiever (especially when compared with its neighbor to the south). But Pyongyang's leaders are past masters at commanding international attention, usually by threatening to do something undesirable (and then sometimes going ahead and doing it). North Korea is hardly an inspiring model for anyone, but it shows how sheer cussedness can enable a country to punch well above their weight.
America’s northern neighbor has the world's second largest land mass but a relatively small population (only 32 million) and only modest military assets. Yet Canada has been a consistent proponent of multilateralism, ranks ninth in the world as a provider of foreign aid, and has been an enthusiastic participant in international peacekeeping missions. Indeed, Canada has lost 117 soldiers fighting in Afghanistan, the highest per capita figure of any ISAF participant.
For a country whose total population is less than that of New York City, Israel generates a lot more attention than one would expect. To be sure, some of this reflects Israel’s economic success (which includes advanced hi-tech sector and a significant arms industry) not to mention its nuclear arsenal and overall military power. And then there's the occupation and the violence that it has produced over the years. Regardless of one's views on that thorny subject, it's hard to argue that Israel doesn't exert a lot of influence on the global agenda, especially given its very modest size.For a city-state with a population of only 4.4 million, which gained independence only in 1965, Singapore's international prominence marks it as an obvious outlier, even when one allows for its advanced economy and high per capita income. In addition to its economic achievements, Singapore has been a major force behind regional cooperation in Southeast Asia, an energetic promoter of institutions such as ASEAN, and its leaders have rarely been bashful about offering their views on major international issues.
Modern science has largely agreed, spending decades outlining all the things that babies couldn't do because their brains had yet to develop. They were unable to focus, delay gratification, or even express their desires. The Princeton philosopher Peter Singer famously suggested that "killing a disabled infant is not morally equivalent to killing a person. Very often it is not wrong at all."
Now, however, scientists have begun to dramatically revise their concept of a baby's mind. By using new research techniques and tools, they've revealed that the baby brain is abuzz with activity, capable of learning astonishing amounts of information in a relatively short time. Unlike the adult mind, which restricts itself to a narrow slice of reality, babies can take in a much wider spectrum of sensation - they are, in an important sense, more aware of the world than we are.
that Congress suffers from a lack of understanding of even the most rudimentary economics.--Peter OrszagThat is why Congress should not be seated, except for national emergencies.
UPDATE: Congress is incompetent for its part in foreign policy, too?
... it was so galling last month when the Democratic Congress passed a budget with such big deficits that it makes the United States literally ineligible to join France in the European Union.--Lamar Alexander
In the name of containing "systemic risk," our regulators spread it. In order to keep Mr. Lewis quiet, they all but ordered him to deceive his own shareholders. And in the name of restoring financial confidence, they have so mistreated Bank of America that bank executives everywhere have concluded that neither Treasury nor the Federal Reserve can be trusted.--WSJ Editorial Board
The problem originated with mortgages, but it’s now spread well beyond. Say you initially got sick from something but then the illness is throughout your whole body. The infection has spread throughout your whole body! You can’t just go back and fix the hole in your arm.--Peter Orszag
They’re like Sotheby’s and Christie’s, [Moody's and Standard & Poor's]. I’m not sure that “criminal” isn’t too strong a word for the way in which they offer no real alternative to each other, instead chosing to ape whatever the other one does.--Felix Salmon
It's long been obvious that the stress tests are like those kindergarten field days where everyone gets a prize for participating.--Megan McArdle
It is true that the belief in both tighter bank regulation and a larger welfare state cluster on the left, but if social democracy is some sort of preventative cure-all, how come the US economy is outperforming places like Denmark, Sweden, and Germany, not to mention the OECD as a whole? Why, if the problem is "American style capitalism", are the biggest GDP declines found elsewhere?--Megan McArdle
After 9/11, we blamed the CIA for not knowing. Now we blame the CIA for finding out.--Don Surber
As a father, I never imagined that the argumentative, young boy who grew up in my house, eating my food and using my name would be my future employer. But that's what happened.--William Gates, Sr.
... the Bible is actually a much livelier, more entertaining, more approachable read than the experts tell us it is.--David Plotz
Youkilis's walk total went from 91 to 77 to 62 from 2006-2008, but his on-base percentage has increased. The simple explanation is that Youkilis’s batting average has gone up, which is to say that his bat has become as great a weapon as his keen eye.--Tony Massarotti
Friday, April 24, 2009
Now, Duff McDonald notes that Goldman has fallen significantly behind JPMorgan.
What will the landscape of journalism look like in five or ten years, as the dinosaurs of print journalism breath their last. Well, when the dinosaurs disappeared from the earth, the earth became overrun with rodents.--Rick Brookstaber
Could it be that the Times doesn’t want this story [about undemocratic corporate governance and executive pay] told about itself, even as it sold the story on others? Just asking.--Larry Ribstein
Thursday, April 23, 2009
Most pro-growth: Jim DeMint, SC
Most anti-growth: Five-way tie between Joe Biden, DE; Barbara Milkulski, MD; Frank Lautenberg, NJ; Robert Menedez, NJ; Chuck Schumer, NY
Least pro-growth Republican: Olympia Snowe, ME
Least anti-growth Democrat: Mary Landrieu, NO
President Obama could have saved at least 9,116 gallons of fuel by giving his [Earth Day] speech at the White House – but no wind turbines are manufactured here. --Mark Knoeller
Surprisingly, the effects of atmospheric pollution seem to have enhanced global plant productivity by as much as a quarter from 1960 to 1999. This resulted in a net ten percent increase in the amount of carbon stored by the land.--Linda Mercado
... when people are choosing where to live, they consistently underestimate the pain of a long commute. This leads people to mistakenly believe that the McMansion in the suburbs, with its extra bedroom and sprawling lawn, will make them happier, even though it might force them to drive an additional forty-five minutes to work. It turns out, however, that traffic is torture, and the big house isn't worth it.--Jonah Lehrer
Every culture, gender, class, city, field of work, etc., has its own idols. Idolatry is anything I look at and say, "If I have that, my life has value." Anything that is so central to your life that you feel you can't live without it is an idol. Idolatry is making a good thing an ultimate thing.--Tim Keller
President Chávez is a character, and notwithstanding his hard-line ideology that I am a firm opponent of — be under no illusion about that — he’s actually an affable and gregarious and open personality. And for whatever reason, he seems in a particularly good mood this weekend, and we’re all grateful for that.--Stephen Harper
New York is the only one out of the sixteen largest cities in the northeastern or midwestern states whose population is larger than it was fifty years ago.--Alan Beattie
President Barack Obama’s attempt to project legal and moral clarity on coercive CIA interrogation methods has instead done the opposite — creating confusion and political vulnerability over an issue that has inflamed both the left and right.
In the most recent instance, Director of National Intelligence Dennis Blair acknowledged in a memo to the intelligence community that Bush-era interrogation practices yielded had "high-value information,” then omitted that admission from a public version of his assessment.
That leaves a top Obama administration official appearing to validate claims by former Vice President Dick Cheney that waterboarding and other techniques the White House regards as torture were effective in preventing terrorist attacks. And the press release created the impression the administration was trying to suppress this conclusion.
(Via Don Surber)
Federal Reserve Chairman Ben Bernanke and then-Treasury Department chief Henry Paulson pressured Bank of America Corp. to not discuss its increasingly troubled plan to buy Merrill Lynch & Co. -- a deal that later triggered a government bailout of BofA -- according to testimony by Kenneth Lewis, the bank's chief executive.
Mr. Lewis, testifying under oath before New York's attorney general in February, told prosecutors that he believed Messrs. Paulson and Bernanke were instructing him to keep silent about deepening financial difficulties at Merrill, the struggling brokerage giant. As part of his testimony, a transcript of which was reviewed by The Wall Street Journal, Mr. Lewis said the government wanted him to keep quiet while the two sides negotiated government funding to help BofA absorb Merrill and its huge losses.
UPDATE: Matthew Wurtzel is also disturbed.
UPDATE: Megan McArdle, is among other feelings, deeply troubled.
Wednesday, April 22, 2009
The left column for each round is the pick number; the right column the number of points. It shows that, for instance, the first pick of the first round is worth about 5 times as much as the first pick of the second round.
| || || || || || |
UPDATE: Stephen Dubner just posted on how the top NFL draft pick is overvalued. I think that is a bit imprecise. I would counter that it's the rookie pay scale, especially for the first 10 or 15 picks in the draft.
Poverty has no causes; wealth has causes.--Peter Bauer
As their wealth grows, people consume more energy, but they move to more efficient and cleaner sources — from wood to coal and oil, and then to natural gas and nuclear power, progressively emitting less carbon per unit of energy.--John Tierney
Everybody is a product of what they’ve done. I have high respect for bureaucrats, but that doesn’t mean they’re going to have the leadership quality needed when they get to be something like secretary of the Treasury—particularly now.--Bill Seidman
If I had better foresight, maybe I could have improved things a little bit…But frankly, if I had perfect foresight, I would never have taken this job in the first place.--Richard Syron, former Freddie Mac CEO
I didn’t hear the outrage when Joe Biden said that he and Barack Obama are against gay marriage. No incendiary language, no insults, no four letter obscenities. Why is it acceptable for Obama and Biden to have this opinion but not a conservative female?--Andrea Tantaros
Tuesday, April 21, 2009
U.S. regulators and lawmakers are considering stricter oversight of credit-rating firms, including changing the way the firms are paid, in an effort to minimize potential conflicts. A recent 10-month study by the Securities and Exchange Commission found that rating firms put profits ahead of quality when determining ratings for mortgage-backed securities.
Yet to succeed in court, investors may need to navigate a thorny constitutional issue: Are the ratings that the services give securities -- ranging from triple-A to junk -- simply "opinion" that is protected by the First Amendment? Traditionally, the answer has been yes.
Rating firms generally enjoy a free-speech right to "make informed, thoughtful predictions about the future," says UCLA School of Law professor Eugene Volokh, a First Amendment expert. "That is no different from what newspapers or scholars do."
The most enthusiastic fans say that sports are compelling because they imitate life -- which they certainly do in some ways. But at a time when political conversation, to name one crucial form of public communication, is getting steadily dumbed down, John Madden's retirement should remind us that we can do better. His demanding and fruitful style represents a way that life can and should imitate sports. How often does that happen?--Leonard Cassuto
... [environmental] groups are putting local environmental concerns first and the planet second. Wind farms, nuclear power plants and hydroelectric dams are ways of providing clean energy, which would reduce carbon emissions and the threat of global warming.--Ed Glaeser
In hot, humid Houston or frigid Minneapolis, people use plenty of energy to artificially recreate what California has naturally. Environmentalists should, presumably, be out there lobbying for more homes in coastal California, but instead, for more than four decades, California environmental groups, such as Save the Bay, have fought new construction in the most temperate, lowest carbon-emission area of the country. --Ed Glaeser
The optimal capital structure evolves constantly, and successful corporate leaders must constantly consider six factors -- the company and its management, industry dynamics, the state of capital markets, the economy, government regulation and social trends. When these six factors indicate rising business risk, even a dollar of debt may be too much for some companies. Over the past four decades, many companies have struggled with the wrong capital structures. During cycles of credit expansion, companies have often failed to build enough liquidity to survive the inevitable contractions.--Michael Milken
You were talking about an appropriations bill a few weeks ago about $8 billion being minuscule -- $8 billion in earmarks. We were talking about that and you said that that $100 million is a lot but $8 billion is small?--Jake Tapper
We've come to [the brink of a backdoor bank nationalization] in part because the Obama Administration is afraid to ask Congress for the money for a meaningful bank recapitalization. And it may need that money now in part because Mr. Paulson's Treasury insisted on buying preferred stock in all the big banks instead of looking at each case on its merits. That decision last fall squandered TARP money on banks that probably didn't need it and left the Administration short of funds for banks that really do.--WSJ Editorial Board
The good news is that Mr. Obama is smart enough to know that the relative obscurity of Bagram, not to mention the approval he has received on Guantanamo, enables him to do the right thing here without, as Mr. Greenwald notes, worrying too much that he will be called to account for a substantive about-face. The bad news is that we seem to have reached the point where our best hope for sensible war policy now depends largely on presidential cynicism.--William McGurn
One of the things that I find a little bit disturbing about this recent disclosure is they put out the legal memos, the memos that the CIA got from the Office of Legal Counsel, but they didn't put out the memos that showed the success of the effort. And there are reports that show specifically what we gained as a result of this activity. They have not been declassified.--Dick Cheney
Monday, April 20, 2009
BusinessWeek's cover story this week, "What Good Are Economists, Anyway," slams the economic industry for failing to predict and explain the economic crisis, which is weird because that's exactly what any non-economist could say about the business journalism industry.--Derek Thompson
Small cars simply are not as safe as bigger cars, and they can't be made safer by yelling at people who insist on believing in the laws of physics. ... Even hybrids rely at least in part on making the car lighter. On the other hand, running a massive uncontrolled experiment on the global climate seems kind of dangerous too.--Megan McArdle
I say that Americans make extravagant use of medical procedures with high costs and low benefits. But that is only a social problem to the extent that we socialize it.--Arnold Kling
I can only report that The End of Poverty, narrated throughout by Martin Sheen, puts Ayn Rand back on the map as an accurate and indeed insightful cultural commentator. If you were to take the most overdone and most caricatured cocktail-party scenes from Atlas Shrugged, if you were to put the content of Rand’s “whiners” on the screen, mixed in with at least halfway competent production values, you would get something resembling The End of Poverty. If you ever thought that Rand’s nemeses were pure caricature, this film will show you that they are not (if the stalking presence of Naomi Klein has not already done so). If you are looking to benchmark this judgment, consider this: I would not say anything similar even about the movies of Michael Moore.--Tyler Cowen
...the U.S. by far remains the world's leading manufacturer, producing goods valued at a record $1.6 trillion in 2007 — nearly double the $811 billion produced a decade earlier. For every $1 of value produced in China's factories [in 2007], America generated $2.50. Not bad for a country that doesn't produce anything anymore.--Stephen Manning and Harold Sirkin
But there’s a downside [to the elimination of polio]: job loss. How many workers, who played by the rules, lost their jobs as a result of this development? People who built wheelchairs and crutches, who helped manufacture iron-lung machines, and who specialized in nursing polio victims – many of these people were thrown out of work by the product supplied by Dr. Salk and Dr. Sabin. Some of these workers surely found comparable alternative employment quickly. Others took longer to do so. And probably some others were obliged to accept jobs at much lower pay. Maybe some of these workers never found new jobs.--Don Boudreaux
... the Community Reinvestment Act* book accounts for 7% of the total in residential mortgages, but 24% of the losses.
Congress needs to take a looong vacation.
*The act was designed to encourage more minority lending, and though it doesn't require banks to lend out to shaky borrowers, banks make certain CRA commitments in order to get regulatory approval for acquisitions.
A possible effect of this is that banks wishing to grow via acquisition end up with an outsize volume of these commitments.
Sunday, April 19, 2009
William Jacobson really called it last week.
UPDATE: Stephen Green notes:
I’m glad to see Janeane has made a full recovery after spending all those months taking money to be Jack Bauer’s biatch.
UPDATE: Megan McArdle comments as well.
Friday, April 17, 2009
Kim's update lists out in greater detail the horrible unintended consequences of what George Bush and Congress passed in 2005:
This is the tale of how a supposedly innocuous federal subsidy to encourage "alternative energy" has, in a few short years, ballooned into a huge taxpayer liability and a potential trade dispute, even as it has distorted markets and led to greater fossil-fuel use.
If Congress is going to lard up the tax code with thousands of complex provisions designed to "encourage" behavior, it shouldn't be surprised when those already practicing said behavior line up for their reward, too.
Happy as industry is to have this new federal lifeline in the middle of a recession, it is the only one smiling. Foreign competitors are screaming that the subsidy is unfairly propping up the U.S. industry in tough times. They claim the U.S. industry is ramping up production simply to realize more tax money. Canadian forestry firms are already demanding their government file a trade complaint.
In order to qualify for the credit, alternative fuel must be mixed with a taxable one. (The government might want to encourage alternative fuels, but not to the extent that it loses its gas-tax revenue.) This means that to qualify, the paper industry must mix some diesel with its black liquor. This has sent environmentalists around the bend. They have accused the industry of burning fossil fuels that it didn't used to burn, simply to get the tax dollars. (The industry has not been clear on whether it is, in fact, using more diesel.)
And then there's Congress, which is suddenly looking at billions more in red ink than expected. In 2007 it estimated a 15-month extension of the credit would cost taxpayers $333 million. It has since revised those numbers to take into account black liquor and is now figuring a one-year cost of more than $3 billion. Wall Street analysts are talking $6 billion.
But this, in turn, has tossed up uncomfortable questions. The paper industry argues that if the government is going to be in the business of rewarding good behavior, it ought to do it equally. Is green policy only to be aimed at dirty or economically unviable actors? Is black liquor any less useful than ethanol or biodiesel, and if so why? If not, shouldn't Washington encourage its use? Isn't every green subsidy in fact the basis for a trade dispute? These are questions Congress has no interest in confronting, since it would expose the muddle that is its entire green-energy program.
One Fannie Mae debacle ought to be enough for any career, but Mr. Frank wants taxpayers to double down on his political guarantees. There are currently some $1.7 trillion in municipal bonds held by the public, and Barney thinks we can insure them at "zero cost." Considering the source, and the potential size of the bill, someone in Congress needs to sound the alarm.--WSJ Editorial Board
As Milton Friedman often pointed out, the real measure of taxes is not what the government calls taxes but what government spends. Government spending is financed by current taxes, future taxes, or inflation.--David Henderson
Every government attempt to manage energy markets has resulted in similar disarray [as encouraging alternative fuels usage]. Look at the havoc that came from the energy price controls, regulations and subsidies of the 1970s. Or look, more recently, at the ethanol fiasco, and the accompanying soaring food costs. Energy powers the economy. Mess with energy markets, and mess with everything else. When will Washington learn?--Kim Strassel
During [2000-2005], Spitzer repeatedly attacked Wall Street for graft and pressured Wall Street executives to cut deals with his office. Yet, he never once bothered to look into the actions of those within the NYS government who were trusted with overseeing the $122 billion pension plan and whether any irregularities were involved.--lawhawk
The Obama administration has declassified and released opinions of the Justice Department's Office of Legal Counsel (OLC) given in 2005 and earlier that analyze the legality of interrogation techniques authorized for use by the CIA. Those techniques were applied only when expressly permitted by the director, and are described in these opinions in detail, along with their limits and the safeguards applied to them.
Moreover, disclosure of the details of the program pre-empts the study of the president's task force and assures that the suspension imposed by the president's executive order is effectively permanent. There would be little point in the president authorizing measures whose nature and precise limits have already been disclosed in detail to those whose resolve we hope to overcome. This conflicts with the sworn promise of the current director of the CIA, Leon Panetta, who testified in aid of securing Senate confirmation that if he thought he needed additional authority to conduct interrogation to get necessary information, he would seek it from the president. By allowing this disclosure, President Obama has tied not only his own hands but also the hands of any future administration faced with the prospect of attack.
In his book "The Terror Presidency," Jack Goldsmith describes the phenomenon we are now experiencing, and its inevitable effect, referring to what he calls "cycles of timidity and aggression" that have weakened intelligence gathering in the past. Politicians pressure the intelligence community to push to the legal limit, and then cast accusations when aggressiveness goes out of style, thereby encouraging risk aversion, and then, as occurred in the wake of 9/11, criticizing the intelligence community for feckless timidity. He calls these cycles "a terrible problem for our national security." Indeed they are, and the precipitous release of these OLC opinions simply makes the problem worse.
UPDATE: Oh, maybe the President is:
President Barack Obama absolved CIA officers from prosecution for harsh, painful interrogation of terror suspects Thursday, even as his administration released Bush-era memos graphically detailing — and authorizing — such grim tactics as slamming detainees against walls, waterboarding them and keeping them naked and cold for long periods.
Thursday, April 16, 2009
Let's not quibble about little things like evidence. The Obama administration just knows that vets are all racist, Jew-hating crazies waiting to explode. Thank God, DHS has a fearless leader, Janet-from-another-planet Napolitano, who isn't afraid to call white trash "white trash."
In this administration's published opinion, those who've served in our military are a menace to society and the state. And DHS's racist, bigoted implication is that the only danger comes from white, Christian vets (there's not a whisper about minority violence).
Thanks for bringing us together, Mr. President
Racism is racism. The left-wing propaganda document published officially by your government under the title "Right-wing Extremism: Current Economic and Political Climate Fueling Resurgence in Radicalization and Recruitment" may be the shabbiest US Government publication of our time.
Our first minority president just took a giant step toward creating the most bigoted administration since that of arch-segregationist Woodrow Wilson.
Apologize to our veterans, Mr. President. And send Ms. Napolitano back to the minors.
Ralph Peters is so stupid he served in our military for almost 22 years.
As we reported, [F. Kenneth] Bailey made repeated donations to [Gov. Ed] Rendell's 2006 re-election campaign in the months before his law firm was given a no-bid, contingency-fee contract to sue Janssen Pharmaceuticals on the state's behalf. Mr. Rendell told the Philadelphia Inquirer -- whose reporters have roused from their slumbers -- that "there wasn't the slightest bit of pay-to-play here." But the Governor was obliged to acknowledge that Mr. Bailey had approached the state about suing Janssen. Normally, the state Attorney General would handle such legal matters, but the AG rebuffed Mr. Bailey. Mr. Rendell's office then decided to hire the law firm that was also his major campaign donor. Smile if you think the two were related.
The episode speaks volumes about Mr. Rendell's political ethics, but more important is what it reveals about the plaintiffs bar's latest "business" model. Mr. Bailey's Janssen suit is part of a national pay-to-sue operation, as he and his Bailey, Perrin & Bailey law firm have taken their pre-packaged lawsuit to many states. Janssen's complaint asking the Pennsylvania Supreme Court to dismiss Bailey Perrin from the suit notes that the firm has "taken on numerous engagements similar to this action, including representation in the states of Louisiana, South Carolina, Arkansas, Mississippi and New Mexico."It's some racket. The plaintiffs attorneys come up with novel legal theories under which to sue companies or entire industries. They then solicit state AGs (or cash-hungry Governors like Mr. Rendell) to retain them to bring cases on behalf of the government on a contingency-fee basis. Motley Rice and Lieff Cabraser are among the firms that have targeted drug companies as well as makers of cigarettes, paint and guns.
The biggest losers here are the cause of justice and the principle of prosecutorial neutrality. When outside lawyers are hired to do the government's business, and then given a financial stake in the outcome, it creates irreconcilable conflicts of interest. The state delegates key decisions -- about whether and whom to sue, what legal theory to pursue, whether to settle and what remedy to propose -- to private lawyers motivated by profit rather than the public interest.
Meanwhile, the pay-to-sue nature of the transaction means that politicians have an incentive to promote frivolous litigation that makes it even harder for American business to prosper and create jobs. If Governors like Ed Rendell won't stop this legal-political collusion, state legislators should.
...people who frown in photos are five times more likely to get a divorce than people who smile.--Clara Moskowitz
TARP has become a little bit of a scarlet letter.--Jamie Dimon
But picture Isaac Newton scribbling down the laws of physics every day, and every night God comes in and erases the scribblings, changes the laws, and fiddles with the constants. That is what macro is like.--Arnold Kling
Days after North Korea launched, Mr. Obama announced he wants to reduce our nuclear arms inventory so as to "give us a greater moral authority to say to Iran, don't develop a nuclear weapon; to say to North Korea, don't proliferate nuclear weapons." Who would ever invoke "moral authority" with Somalia's pirates? So why North Korea or the others?--Daniel Henninger
Mr Sarkozy is pouring cold water on President Obama's efforts to recast American leadership on the world stage, depicting them as unoriginal, unsubstantial and overrated. Behind leaks and briefings from the Elysée Palace lies Mr Sarkozy's irritation at the rock-star welcome that Europe gave Mr Obama on his Europan tour earlier this month.
The American President's call "to free the world of the menace of a nuclear nightmare" was hot air, Mr Sarkozy's diplomatic staff told him in a report. "It was rhetoric – not a speech on American security policy but an export model aimed at improving the image of the United States," they said. Most of Mr Obama's proposals had already been made by the Bush administration and Washington was dragging its feet on disarmament and treaties against nuclear proliferation, the leaked report said.
Personal pique and French politics are also behind the souring of Mr Sarkozy's self-promoted honeymoon with the United States. On the personal side, the French President is needled by the adulation for an unproven US leader whose stardom has eclipsed what he sees as his established record as a world troubleshooter. "The President is annoyed by what he sees as the naivety and the herd mentality of the media," said a journalist who is privy to Elysée thinking.
Mr Sarkozy has put out a version of the proceedings at the London G20 economic summit which casts him as hero, in the classic French role of intransigent defender of principle in the face of the American steamroller. This is to counter last week's reports of Mr Obama saving the day by persuading President Hu of China to accept Mr Sarkozy's demands for naming tax havens.
According to the leaks, Mr Sarkozy shamed Mr Obama into intervening: "You were elected to build a new world. Tax havens are the embodiment of the old world," he is quoted as saying. He also reprimanded Mr Obama for setting US goals for climate change that were inferior to Europe's, according to his staff.
Again, according to the Sarkozy version, at the Nato summit in Strasbourg, Mr Obama was meekly yielding to Turkey's refusal to endorse Anders Fogh Rasmussen as the alliance's new Secretary-General. It took pressure from Mr Sarkozy and Chancellor Merkel of Germany to stiffen him up and change his mind, say the French.
Is Obama Carter II, Clinton II, or Dubya II? A significant dosage of each, it seems.
UPDATE: Glenn Reynolds notes that affection is on the decline, too:
I thought the world was going to love us!
Wednesday, April 15, 2009
Suppose the only people in the world are Hannibal the millionaire, a slave trader, and 10,000 penniless orphan slaves. The slave trader has no direct use for his slaves, but likes money; Hannibal, on the other hand, is a ravenous cannibal. According to Robin, the "optimal outcome" is for Hannibal to get all 10,000 orphans and eat them.
But [North Korea's] existence is profound, confirming that an Orwellian state is possible.--Tim Kane
Like it or not, Goldman is a central part of the financial system, which means that it’s a central part of any bailout strategy. It can’t unilaterally say no to that, and I hope that it gets slapped down by Treasury as definitively as it was slapped down by the stock market yesterday.--Felix Salmon
First, we should close down as promptly as possible Fannie Mae and Freddie Mac. There never was a reason for those two institutions, other than to avoid the congressional budget process. The benefit that people got from Fannie and Freddie came from the subsidy to the mortgage interest rate. Congress could have passed that subsidy over and over again. They avoided passing it by taking the program off budget.--Allan Metzer
And now, with his donor base shrinking, Dodd has to face the first tough Senate race of his career with the mortgage scandal, the AIG bonus scandal, the pardon for a felonious friend scandal, the Irish cottage scandal and, as an extra, added distraction, the charge he was AWOL as chairman of the banking committee while the economy was collapsing. It's not hard to see why Dodd is redesigning himself as an outraged fixer of the financial mess that evolved while he was running for president.--Dick Ahles
Of course, I find [Walt Disney] interesting because it’s a form of self-flattery: he managed to make legit both sappy nostalgia and starry whiz-bang futurism. He loved the small town and the moon base.--James Lileks
Tuesday, April 14, 2009
F.A. Hayek Interviewed By John O'Sullivan from FEE on Vimeo.
UPDATE: Arnold Kling says:
Very rewarding to listen. For example, a bit over an hour into it, he makes the point that unions that force up wages in one industry will divert capital into that industry, taking it away from workers in other industries. Earlier, his thoughts on the three sources of social norms--instinct, tradition, and intellectual theory--are well articulated, also.
Only in a highly politicized bureaucracy could the Constitution be viewed as a subversive manifesto.--William Jacobson
In countries where a woman has a virtually unfettered right to choose abortion, the result is that women overwhelmingly choose to abort female fetuses.--William Jacobson
And indeed, the political battle over health care is infused with the belief that you shouldn't have to think about cost--that it is immoral to deny anyone a treatment that might help them.--Megan McArdle
By [Douglas McIntyre's] numbers, total pirate loot for this year will probably be somewhere around $200 million. Of course they have various expenses, such as boats, GPS equipment and most importantly protection -- some would liken that to a mafia payoff, though in developed economies we'd call it "taxation."--Joe Weisenthal
And, indeed, what is the State anyway but organized banditry? What is taxation but theft on a gigantic, unchecked, scale? What is war but mass murder on a scale impossible by private police forces? What is conscription but mass enslavement? Can anyone envision a private police force getting away with a tiny fraction of what States get away with, and do habitually, year after year, century after century?--Murray Rothbard
Many union members, whose dues are being used to fund this odd alliance [with environmental groups], might be shocked to find out they were paying to hasten the demise of the industries employing them.--Jennifer Rubin
At least with regard to sex, MIT economics majors are not putting the freak in Freakonomics.--Ian Ayers
Monday, April 13, 2009
His math skills seem to be slightly deficient. The other day, in preparation for the standardized test, I asked the students the usual “Train Leaving Chicago” question. He said the answer was to bail out both railroads.
When I told him this was far from the correct answer, he said that this was a problem left over from George, who was a student who transferred to Texas during the semester break when your grandson transferred in.
He refused to say another word until I brought the lectern to his desk. After that he seemed happy. I decided that he does better with the lectern, so that explains why it now sits next to his desk.
He calls it LOTUS.
Must be some sort of family joke that I don’t get.
The coach said he is a fine addition to the basketball team. The only drawback is he cannot seem to understand that when he makes a basket, it counts the same as a basket made by anyone else.
I am not so sure that he is quite as aware as he should be about American culture. The other day, our sixth-grade team traveled to another school to play its rival. He quickly became popular with the members of the other team by apologizing for our team’s past victories.
Then he did not seem to understand why they elbowed him and pushed him around during the game anyway.
We absorbed our worst drubbing in years.
For some reason, he has become a Pittsburgh Pirates fan this spring.
Except for these small things, your grandson is adjusting well and he is an excellent student who makes friends quite easily.
P.S. The cafeteria lady would like to have a word with you. It seems your grandson insists on buying everyone’s lunch and the bill is getting quite high. I’m sure you are good for the money.
Chicago streetwalkers earn $25 to $30 an hour, four times what they'd get in other jobs available to them. Venkatesh has also tried to assess the value of having a pimp versus self-managing, which he calls "a classic business school, industrial organization question." Prostitutes who work with pimps, it turns out, appear to earn more and get arrested less frequently. The Chicago prostitution study, which continues, will be written up in the sequel to Freakonomics, to be published in a year or so.
UPDATE: Stephen Green says:
The missing context is this — the might and will of the United States were held hostage, until one brave civilian captain took matters into his own hands. Philips risked his life escaping, and opened the door for the Navy SEALs — who ought to be in the business of kicking doors down.
This particular event ended well, due largely to the actions of Captain Phillips. Next time we might not be so lucky.
UPDATE: Will Collier would probably agree with my proposal to unseat Congress as much as possible.
UPDATE: Tom Baldwin says that Obama has laid some Carteresque doubts to rest. Hope.
UPDATE: Jules Crittenden begs to differ:
The success yesterday was due to a military that has been equipped, configured and trained for this kind of action since the Reagan years, and has seen a great deal of it in combat against America’s enemies in the last decade. The Carter analogy kicks in not so much with the happy, violent ending to a single incident, but with the follow-through. What are you going to do about, Obama?
UPDATE: So does William Jacobson:
The problem is not in this case, which ended successfully, but in the next hostage taking situation. If one is going to follow a negotiation approach, the trust of the hostage takers in the negotiation process is key. If hostage takers believe negotiation is a ruse, then the hostage is in more danger. Words cannot be just words in a negotiation.
So negotiating as a ruse is the worst of all alternatives. It does not have the deterrent effect of the Israeli approach, or the hostage-safety effect of the negotiation approach.
UPDATE: Richard Fernandez looks ahead:
In the coming months, some merchant crew may try to imitate the actions of the Maersk Alabama and suffer terribly at the hands of pirates who may be determined to inflict an object lesson on the shipowners. With their humiliation at the hands of the USN, the pirates have temporarily lost their most powerful weapon: terror. They will be eager to regain it.
- Liabilities do indeed cross the divisions of a single firm, and that is why the New Products Division of AIG tanked the many other profitable divisions of the insurance giant. But these losses do not cancel the earnings of profitable firms.
- Back in 2002 the aggregate earnings of the S&P 500 Index also plummeted when a few firms, such as AOL and JDS Uniphase, took huge writedowns on some of their Internet investments. Reported P/E ratios soared into the 60s in the second quarter of 2002, yet rather than being overvalued, the market was just approaching its bear market low.
The idea that we can continue to raise revenue, while shifting more of the burden onto fewer and fewer people is a pipe dream. Think of the grand scale of the government's ambitions, from fighting wars to providing universal healthcare. Are we really to believe that all this can be done via a tax increase on the top 2%? That's obviously hogwash. What's more is that top 2% is getting sharply poorer fast, given the collapse of the financial industry.--Joe Weisenthal
My preferred story, in contrast, is just that once in a century, we get a once-in-a-century economic disaster. These disasters are hard for anyone to foresee, no matter how smart he is. The trick is just to keep the rarity of such disasters in perspective, stay calm, and let things get back to normal. Sigh.--Bryan Caplan
But I’m not sure proponents of [short sales] restrictions even care about these arguments. They don’t like short-selling because it tells the truth.--Larry Ribstein
For the bottom 40% [of income tax filers], the redistribution deal is even better. In 2001, these 43 million Americans, who earn less than $30,500, made 13.5% of the nation's income but paid no income tax. Instead, they received checks from their taxpaying neighbors worth $16.3 billion. By 2005, those checks totaled $33.3 billion.--Ari Fleischer
But in an increasingly specialized society, those skills are increasingly specific,. The more skills you have, the fewer jobs there are that match them.--Megan McArdle
Remember the good old days, when economists used to write papers about how firms -- most of all public utilities -- would under-report profits, to minimize regulation and control? These days we have firms over-reporting profits to minimize regulation and control.--Tyler Cowen
The people who just want to know things because they need to make important decisions, in contrast, usually say little about their love of truth; they are too busy trying to figure stuff out. These are the "truth lovers" I most respect in the sense of trusting their efforts to be directly targeted to actually uncovering truth. Sellers, hobbyists, and do-gooders are instead more likely to pretend to seek truth while actually seeking cash or respect.--Robin Hanson
... why does Brad DeLong make up fake statistics? Is he afraid the truth won't support his orthodoxy? He claims twice -- not once, but twice! -- that it is unfair to say the New Deal was ineffective, because "unemployment did fall from 23% in 1932 to 11% in 1939." Yet the Bureau of Labor Statistics reports that unemployment as 17% in 1939.--Don Luskin
I believe that computers have taken over the world. I believe that they have in many ways ruined our children. I believe that kids used to love to go out and play. I believe that social graces are gone because manners are gone because all people do is sit around and text. I think it’s obnoxious.--Steve Nicks
The wheel is also a bad idea.--Don SurberThe challenge now for [Tom] Brady is to do what Tiger Woods has done – keep his personal life private while remaining the premier player in his sport.--Jim Donaldson
Dancing with the Stars is like life itself, only stupider-looking. So you sympathize with the contestants. Because they suck in the same way we suck. Because they succeed in the same way we succeed. They work hard. And they either get it or they don't. As Lawrence Taylor goes, so may I go. So may all of us go. In dancing, as in life.--Ross McCammon