Wednesday, June 23, 2010

Quotes of the day

No other general is going to succeed with such men in such a position [in Afghanistan]. The overwhelming lesson of [Michael] Hastings’s article is not: “Get rid of McChrystal.” It is, simply: “Get out!”--Garry Willis

... historically the boundaries between government and criminal groups have often been very fuzzy.--Paul Seabright

It’s not just the Devil who’s in the details ... God, it turns out, is in there too. Daylight ...--Bono

Thuggery is unattractive. Ineffective thuggery even more so. Which may be one reason so many Americans have been reacting negatively to the response of Barack Obama and his administration to BP's Gulf oil spill. ... the Constitution does not command "no person . . . shall . . . be deprived of life, liberty or property, without due process of law except by the decision of a person as wise and capable as Kenneth Feinberg." The Framers stopped at "due process of law." Obama doesn't. "If he sees any impropriety in politicians ordering executives about, upstaging the courts and threatening confiscation, he has not said so," write the editors of the Economist, who then suggest that markets see Obama as "an American version of Vladimir Putin." Except that Putin is an effective thug.--Michael Barone

Much to the government’s discomfort and this Court’s uneasiness, the Summary also states that “the recommendations contained in this report have been peer-reviewed by seven experts identified by the National Academy of Engineering.” As the plaintiffs, and the experts themselves, pointedly observe, this statement was misleading. The experts charge it was a “misrepresentation.” It was factually incorrect. Although the experts agreed with the safety recommendations contained in the body of the main Report, five of the National Academy experts and three of the other experts have publicly stated that they “do not agree with the six month blanket moratorium” on floating drilling. They envisioned a more limited kind of moratorium, but a blanket moratorium was added after their final review, they complain, and was never agreed to by them. A factor that might cause some apprehension about the probity of the process that led to the Report. ... After reviewing the Secretary [of Energy Ken Salazar's] Report, the Moratorium Memorandum, and the Notice to Lessees, the Court is unable to divine or fathom a relationship between the findings and the immense scope of the moratorium. The Report, invoked by the Secretary, describes the offshore oil industry in the Gulf and offers many compelling recommendations to improve safety. But it offers no time line for implementation, though many of the proposed changes are represented to be implemented immediately. The Report patently lacks any analysis of the asserted fear of threat of irreparable injury or safety hazards posed by the thirty-three permitted rigs also reached by the moratorium. It is incident specific and driven: Deepwater Horizon and BP only. None others. While the Report notes the increase in deepwater drilling over the past ten years and the increased safety risk associated with deepwater drilling, the parameters of “deepwater” remain confused. And drilling elsewhere simply seems driven by political or social agendas on all sides. ... How these studies support a finding that shear equipment does not work consistently at 500 feet is incomprehensible. If some drilling equipment parts are flawed, is it rational to say all are? Are all airplanes a danger because one was? All oil tankers like Exxon Valdez? All trains? All mines? That sort of thinking seems heavyhanded, and rather overbearing.--Justice Martin Feldman

A whim of the president is not, in a country that can meaningfully be said to be governed by the rule of law, sufficient basis for this. And by putting the money in an “escrow fund,” it gives the illusion that there’s some kind of contractual or due process mechanism at play here. There isn’t. Procedure matters in a liberal democracy; getting to the “right result” isn’t enough. Of course, Obama couldn’t do this if his predecessor hadn’t teed up such a perfect shot for him. So well done, Republicans. Your insistence that the “unitary authority” of the president allowed him to imprison and execute at will has been reapplied from real people to the legal persons that are corporations. Nothing Obama’s doing is inconsistent with the Bush doctrine on presidential power. The target has merely shifted. Heck, it’s really just a continuation of existing Bush administration policy: Hank Paulson did the same thing when forcing banks to take TARP money, though at least TARP could hide behind the fig leaf of congressional action.--Daniel Rothschild

Meanwhile, Secretary Salazar has renamed the Minerals Management Service as the Bureau of Ocean energy Management, Regulation and Enforcement.--Jonathan Adler

I made so many errors there it's pathetic. I made one of my favorite errors: "The mouse with one hole is quickly cornered." That is key. There are certain decisions you make in life that are irreversible, that lead you into a path you can't get out of, and unless you have more than one escape clause, the adversary can gang up on you and destroy you. What else? I didn't have a proper foundation. I was not sufficiently private in my activities. I was playing poker with men named Doc. I must've made a hundred errors on that one, but those are five or six that come to mind. And then there's the greatest error of all, which is that I had delusions of grandeur. Unfortunately I was so successful for so many years in that particular field that I began to believe in my own success. I thought that because my method worked in markets that I knew about and had quantified, I could apply the same methods to something I didn't know about. And I had as an example [George] Soros, who would always say, "I made the most money in things I don't know about." ... In both cases I was in over my head. I didn't have the capital to be strong enough to provide a backup in the case of unforeseen events. I didn't have a proper foundation. I was playing with adversaries who were stronger than me and who actually made the rules. My base of operations was not diversified enough, and I was vulnerable to forces I couldn't withstand. I was too vainglorious. In my opinion, those are recurring errors behind most disasters. ... I'd had this incredible string of successes where I made 50, 100 percent, year after year. And in 2006 I'd won the award again as the best-performing fund—you can imagine how reluctant they were to give me the award a second time after my first disaster—but I didn't take account of this. I didn't have a stop-gain, if you will.--Victor Niederhoffer

In the real world, a budget would involve adding up income and spending, taking a realistic view of future income and figuring out the least painful place to spend less. Tough choices, perhaps, but you can figure out your own emergency Budget with little more than pen, paper and Mr Micawber’s dictum about the sixpences. In Westminster, Budgets are very different. The ideal Budget skewers about 30 per cent of the population in some subtle way and showers the other 70 per cent with eye-catching goodies. The losers may be rotated from year to year, although if they are smokers they will suffer every time. I am not sure how this would work in the Harford household. Suppose I had let my wife spend a decade or so rearranging chocolate button quotas. Then I would sweep in, announcing that I had suddenly found a gigantic credit card bill stuffed behind the sofa, when in fact it had been attached to the front of the fridge. I would then give each of my daughters a lollipop and send them out to work on an assembly line, preferably outside the south-east so I’d enjoy a tax break. That’s what I call private wealth creation. This time around, the Budget did feel different, and not just because the chancellor was younger than England’s goalkeeper and flanked by Liberal Democrat fullbacks, poised to intervene if young George fumbled a shot from the backbenches. No, this Budget was different because Mr Osborne really did start to sound like Micawber. For one thing, neither seems to have any idea what fiscal stimulus is.--Tim Harford

A new study by Harvard health policy professor Joseph Newhouse finds that when Medicare payments to doctors for chemotherapy are cut, doctors respond by prescribing chemotherapy to more patients than they previously had, thus making up the difference. Predictable or unintended consequence, it’s still Econ 101. Still, policymakers act as if people (and doctors are people) can be immune to incentives. Since the Obama health reform pays for itself in part with medicare payment cuts, expect to see more of this sort of thing. What’s especially interesting to me is how this underscores the insanely asymmetric relationship we have with doctors. The only difference between a doctor and a car mechanic telling you that you need to replace your Johnson rod is that you’re probably in a much more vulnerable position talking to a doctor.--Jerry Brito

Human height has posed an emblematic challenge to geneticists searching for the link between genes and complex traits and diseases. It's strongly heritable — how tall one's parents are is 80–90% predictive of one's own stature. But studies scanning the genomes of tens of thousands of individuals for gene variants associated with height have come up short: around 50 variants have been identified, but together they account for only 5% or so of height's heritability.--Alla Katsnelson

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