iCount

Well more than you might think.



If you examine the economic and demographic assumptions that together generate the standard Intermediate Cost alternative of the Social Security Trustees you see a picture of a future America that is kind of bleak. I mean I lived through the period from 1968 to 1983 and economically it was not much fun. We had war and assasinations and oil crises and three recessions and a constitutional crisis over impeachment. It wasn't all doom and gloom, over that same rough time period the world transtioned from the baseline assumption that nuclear armeggedon was pretty much ultimately unavoidable to a place where that prospect seemed inconceivable. And as a kid who grew up with school "duck and cover" drills that was an unalloyed good, but still there was a widespread sense that in particular these kind of economic outcomes were outside the norm, that times had been better before and that times would be better again. In part this was just nostalgia for an America that for a lot of people really never was, after all 'Happy Days' and 'Back to the Future' were not exactly documentaries, but Reagan's 'Morning in America' had a real resonance to people, there was a real sense that the future could be better than the immediate past and even the imagined past of the fifties as seen through the lens of 'Father Knows Best'.



But none of that optimism shows up in the Tables and Figures of the Social Security Reports. Instead they and commenters thereon insist that the future is simply going to mirror the outcomes of 1968-1983, indeed just the other day I had a commenter that insisted that Low Cost outcomes were impossible because they were inconsistent with the last forty years. Well that is what happens when you pick a starting point that manages to take in all of the worst post-war years and ignores everything that happened before. I will be unpacking some numbers below the fold but want to leave these doomsayers with a hopefully provocative question.



Why the hell are you betting against America? While we maybe well and truly entering permanent Roubini-land why are you doubling down based on that?



As I say it all starts with the numbers, and in particular the numbers as seen in Table V.B1: Principal Economic Assumptions, Table V.B2: Additional Economic Factors, and Table V.A1: Principal Demographic assumptions, all of which (and many more) to be found in 2008 Social Security Report: List of Tables. The Economic tables show outcomes in five year periods since 1960 and annually since 1997 and then turn around and project annual results for the following ten years and then for multi-year periods (V.B1) or intervals (V.B2) after that. The Demographic table reports both by interval back to 1940 and then annually from 1995. Going forward Table V.A1 projects results with 5 year intervals.



Generally speaking the various models of the Trustees' Report assume that under all three alternatives (Low Cost, Intermediate Cost, and High Cost) results will settle out in the relatively short term at ultimate levels. Which is just another way of defining long term sustainability of the US economy under projections that are presumed to range from optimistic (Low Cost) to pessimistic (High Cost) with Intermediate serving as a median. So lets take a look at some of those numbers and contrast them with 2004, a year of good economic performance but not one that most people would remember as exceptional.



Productivity: 2004 2.4%; High Cost ultimate 1.4%; Intermediate Cost 1.7%; Low Cost 2.0%

Real Wage: 2004 1.8%; High Cost .6%; Intermediate Cost 1.1%; Low Cost 1.6%

Unemployment: 2004 5.5%; High Cost 6.5%; Intermediate Cost 5.5%; Low Cost 4.5%

Real GDP: 2004 3.6%; High Cost 1.2%; Intermediate Cost 2.1%; Low Cost 2.9%

Immigration: 2004 1.25 million; High Cost .77 million; Intermediate Cost 1.025 million; Low Cost 1.305 million



Now I know some people will want to jump in and start the standard defense of 'Boomers!' and 'Covered worker ratio!!'. And yeah I get that but these ultimate numbers are all for period beyond 2050 when the impact of the Boomers on the economy should be pretty much a fading memory (we will be 86 to 104 in 2050). Why on earth should we assume that even optimistic numbers for the second half of the twenty-first century will trail the numbers of the second half of the twentieth century so badly? I understand that conditions approaching perma-recession could happen, I am the farthest thing from a global warming denier or from not recognizing the food/fuel crisis going forwards. On the other hand I am not just ready to simply write America's economic future off as a lost cause either.



I am not happy with the status of America today. Which doesn't mean I have lost faith in its possibilities tommorrow. Which know it or not is exactly what embracers of Social Security 'crisis' have done. Dudes and dudettes what caused you to lose your faith here? Criminy its the Fourth of July.

by Bruce Webb (noreply@blogger.com) on July 04, 2008 04:58 PM

And before the conservative PC police bellyache about this being disrespectful: stuff it. It’s poking gentle fun at the excesses of the holiday and any country that cannot take a little gentle ribbing isn’t worth much. Fortunately, the majority of Americans understand that.

by Kevin on July 04, 2008 02:50 PM

So says Robert Reich. And what he means is investment in infrastructure.



When Philip Swagel, the administration's spokesman, was asked if the economy needs another stimulus package after having lost 62,000 jobs, all he could say was

"I-it seems, you know, it seems like that's, that's enough, uh, enough."

What might trigger another round of economic stimulus?

"I don't, I guess I don't have an answer, I mean, you know, beyond saying we look at all the data and, um -- so, my usual line."

Neither men will address the problem of trade. Both see fiscal policy as governing economic health, albeit in differences large enough to continue the irrelevant debate that has consumed both political parties since time began. Boiled down into sound bites, which seems the only way either party can function, the fiscal argument usually revolves around taxation and spending.

Meanwhile, the twin deficits continue to rise. Our last trade surplus was in 1975--mostly downhill from then. Strangely enough our account deficit has risen since then. Conclusion? We relied more and more on credit, both personal and governmental.



Clintonites will argue, of course, that under their watch, there were account surpluses. I would point out, however, that the trade balance began to rise sharply in the Clinton watch, moving from -70 billion in 1993 to -378 billion in 2000.



Clinton rode the dot.com wave....lucky. He happened to govern while the U.S. led the world in a marvelous IT revolution. While jobs increased and government coffers filled, the trade deficit increased sharply, over 500%. In short, the central issue of trade was muffled. Have you ever heard a Clintonite brag about trade surpluses?



Since Clinton, of course, the trade deficit has doubled. The only bright spot in the trade deficit has been services, mostly financial. (Republicans like bankers. Unfortunately, financial services while a golden opportunity for a few, were not so good for the average American.) Various arguments have been used to soften this harsh reality; economists have gone to measure deficits in terms of percentage of GDP, hopefully to show us that it aint all that bad. Well, it is. Trade is important.



Some economists argue that the falling dollar will make our goods cheaper on the world market, thus dramatically improving our trade balance. Hmmmm. Aint happened yet. We keep shedding manufacturing jobs.



To keep ahead of the downward curve, businesses outsource or overseas everything, from teeth to sneakers. Of course, the fallling dollar will encourage foreign tourists.... but now there is the problem of oil. On this last and most dramatic of our headaches, I would suggest that it may be the straw that breaks the camel's back or it may be ironically be our savior.



How our savior? If the present spike in oil is not primarily speculation--and I suggest that we will know this by year's end-- and if exporting countries stop subsidizing the cost of oil--, then we may have to become more local. Transportation costs of goods will rise, from ships and planes to trucks. Rail will be less expensive. (Now there's an infrastructure worth talking about.)



Additionally, we will have either to find alternatives to oil in the manufacturing of some goods (plastics, for example) or find suitable alternatives that do do require oil. We also need cars with much, much better mileage. In other words, inventiveness will again count. Shortcuts--cheap labor and environmental degradation--will be throttled.



If the present spike is speculation--and I suspect it isn't--, then we will be left with facing our old bugaboo: Trade. And no amount of pump priming fiscal policy a la tax cuts or infrastructure will do the complete job.

by Stormy (noreply@blogger.com) on July 04, 2008 02:45 PM

I'm looking for a bumper stickers that says,

Bin Laden still has his job, do you?



But seriously, when Bush took office in January 2001:



The unemployment rate was 4.2%, now it is 5.5%.



The inflation rate was 3.7%, now it is 4.1%.



Gasoline was around $1.45, now it is over $4.00.



The S&P 500 was 1,342 and now it is 1,261.



The trade weighted dollar was 122.7, now it is 96.0.



The Republicans keep warning us that if we elect a Democratic president things will go in the

opposite direction.

by spencer (noreply@blogger.com) on July 04, 2008 02:21 PM

Hat tip Robert Waldmann post autistic thought...er, economic ... stochastic...er. Just press the button already.



Ken Houghton says the race is on. A man who likes this video should be a guest...he takes himself seriously.

by rdan (noreply@blogger.com) on July 04, 2008 02:02 PM

Fed values Bear Stearns assets at a level where it has only cost them $100,000nothing—so far. (Indeed, there's a $50,000 "buffer" left.)



Strangely, the scuttlebutt in the market yesterday was that the valuation should be around $24 billion. Or at least that's how I read this paragraph:

If the portfolio's value were to drop to below about $24 billion, that could indicate mortgage-backed securities have fared even worse in the second quarter than markets have already reflected, analysts said.

So the Fed thinks the market for those securities is about 23% higher than market professionals were telling Reuters it was yesterday.



If I were a Fed policymaker, and I hadn't been worying about the TSLF before, I would be now.



via CR

by Ken Houghton (noreply@blogger.com) on July 04, 2008 10:19 AM

The latest Employment Situation Summary was released a couple of hours ago:

Nonfarm payroll employment continued to trend down in June (-62,000), while the unemployment rate held at 5.5 percent, the Bureau of Labor Statistics of the U.S. Department of Labor reported today. Employment continued to fall in construction, manufacturing, and employment services, while health care and mining added jobs.

Something tells me that the Bush cheerleaders at the National Review are thinking about rehashing their mantra about how the Household Survey is a better measure than the Payroll Survey as they argue that the fact that the unemployment did not rise in June is an indication that things are not so bad after all. But they should check a couple of things before they write this down as employment per the Household Survey fell by 155,000. This from the BLS is really fascinating:

The employment-population ratio was 0.6 percentage point lower than a year earlier.

This ratio was 63.0% as of June 2007, was 62.6% as of May 2008, and now stands at 62.4%. So why didn’t the unemployment rate rise? It seems the labor force participation rate fell from 66.2% as of May 2008 to 66.1% as of June 2008. Then again – it was 66.1% as of June 2007.



The unemployment rate last June 2007 was only 4.6%. With the labor force participation rate over the past year being unchanged, the rise in the unemployment rates just happens to track the drop in the employment-population rate quite well.



And the news is really bad indeed. In fact, when we compare the employment-population ratio as of December 2006, which was 63.4%, to the 62.4% as of last month - things look dreadful.



Update: The White House finds its silver lining:

Nonfarm payroll employment decreased by 62,000 jobs in June and the unemployment rate remained unchanged at 5.5 percent, in line with expectations. Although these numbers are disappointing, the unemployment rate remains below the averages for the past three decades. Despite slow growth, the economy continues to demonstrate resilience. The first quarter GDP was revised up to one percent at an annual rate, and other data suggest growth in the second quarter may be stronger than the first quarter

by PGL (noreply@blogger.com) on July 03, 2008 08:32 PM

Barack Obama has been reading the Wall Street Journal.

by Ken Houghton (noreply@blogger.com) on July 03, 2008 08:26 PM

Let’s start with the comments of someone who can actually think:

Up on Capitol Hill today, talking to a senior Democratic Senate staff protege, I was asked "What can we do to counter the Republicans on offshore drilling for oil?" My response was, "There is no short-term fix to our long-term energy problems. Drilling won't do it because it will take years to land any oil." "Yes, but the voters think it's going to help now." I responded, "Now you're asking me for cosmetics, not a solution." In a nutshell, that's why we're 58% dependent upon foreign oil. Every time we have an energy crisis, in 1973, 1979, 1990, and 2008, we rush short-term expedients and cosmetics into law without doing much to solve the long-term problem. If we were serious about the long-term problem we would never have allowed gas guzzling SUV's onto the road; we wouldn't have starved mass transportation; we would have developed much more renewable energy; we would have done a lot more conservation; and MOST OF ALL we wouldn't have allowed prices to decline after the crisis, killing energy saving investments and leading us right back to profligate energy consumption. Our energy policy is like our diets. We diet frequently, but we never stick to our diets long enough or change our lifestyles enough to lose weight. Then, when diabetes and heart disease sets in, we rush to our doctors for the miracle cure that isn't there ... Until we learn to live with somewhat higher energy prices, we'll continue to be at the mercy of OPEC and of periodic energy crises. As long as we demand quick fixes from our political leaders, that's all we will get -- quick fixes that don't work.

Thanks for the wisdom Pete, but now I have to ruin the Fourth of July weekend for our AB readers but noting what some village idiot has been saying:

Where in the world is John McCain on this very same issue? It’s simple: Sen. McCain should be pummeling Barack Obama daily on drill, drill, drill. Why? Because oil and gas pump prices are potentially the single-biggest wedge issue in the presidential campaign. Mr. McCain has to pound the point home. According to a new Rasmussen poll, 48 percent of Americans say lower gas prices are the key to an economic recovery, and 60 percent are in favor of off-shore drilling.

I guess Kudlow hasn’t realized that McCain – who once opposed offshore drilling – flip flopped and took this idiotic advice. I say idiotic as every analysis that I’ve seen holds that the immediate impact on gasoline prices would be zero and the effect after a generation would be very small. It’s really funny because McCain had to later admit that his pandering proposal would do nothing to lower the current high gasoline prices. But I guess Kudlow hasn’t figured that one out either. I might advocate that we try to drill, drill, drill some commonsense into Kudlow’s feeble little brain but our friend Pete Davis would likely argue that such efforts wouldn’t work either.



Update: The Pray at the Pump Movement has a plan to lower gasoline prices:

(CNSNews.com) - As the price of oil continues to rise, some are turning to God and prayer for an answer to their financial troubles. The Pray at the Pump Movement, founded by Rocky Twyman, has been holding prayer vigils at gas stations across the country. On Monday, Twyman decided to take his movement from Exxon and Shell stations straight to the steps of the Embassy of Saudi Arabia in Washington, D.C., hoping to encourage the oil-rich country to raise the amount of barrels they release each day from 200,000 to 1.2 million.

Don’t knock divine intervention as it sounds better than anything John McCain has come up with!

by PGL (noreply@blogger.com) on July 03, 2008 08:24 PM

Mark Thoma has original attribution at Economist's View



Economic Dreams-Economic Nightmares discusses Jamie Galbraith's recent presentation:

Hyman Minsky, John Kenneth Galbraith and John Maynard Keynes take center stage as James Galbraith throws down the gauntlet to contemporary mainstream economists. Speaking at the 25th Annual Milton Friedman Distinguished Lecture at Marietta College, Marietta, Ohio, Jamie Galbraith asks Fed Chair Ben Bernanke and a host of others to embrace the " intellectual victory of John Maynard Keynes, of John Kenneth Galbraith, of Hyman Minsky." — else to explain "why not". We will search and update on any "why nots" if and when they surface.

To Galbraith:

The Collapse of Monetarism and the Irrelevance of the New Monetary Consensus [PDF], by James K. Galbraith, March 31, 2008 : … I come to bury Milton [Friedman], not to praise him. But I would like to do so on the terrain that he favored, where he was strong, and over which he ruled for many decades. This is monetary policy, monetarism, the natural rate of unemployment and the priority of fighting inflation over fighting unemployment. It is here that Friedman had his largest practical impact and also his greatest intellectual success. It was on this battleground that he beat out the entire Keynesian establishment of the 1960s, stuck as they were on a stable Phillips Curve. It was here that he set the stage for the counter-revolution that has dominated academic macroeconomics for a generation, and that – far more important — also dominated and continues to influence the way in which most people think about monetary policy and the fight against inflation.



What was monetarism? Friedman famously defined it as the proposition that "inflation is everywhere and always a monetary phenomenon." This meant that money and prices were tied together. But more than that, Friedman believed that money was a policy variable — a quantity that the Central Bank could create or destroy at will. Create too much, there would be inflation. Create too little, and the economy might collapse. There followed from this that the right amount would generate the right result: stable prices at what Friedman came to call the natural rate of unemployment.



The intent and effect of this line of reasoning was to defend a core proposition about capitalism: that free and unfettered markets are intrinsically stable. In Friedman's gospels government is the lone serpent in Eden, while the task of policy is to stay out of the way. Just as this was the vulgar lesson of "Free to Choose" so it turns out it was also the deep lesson of the larger structure of Friedman's thought. Friedman and Schwartz's Monetary History for all its facts and statistics carried a simple message: the market did not fail; the government did.

The paper is long for here, but worth a visit to Economic Dreams-Economic Nightmares.



Update: Original is at Economist's View

by rdan (noreply@blogger.com) on July 03, 2008 05:13 PM

From a DCCC fundraiser/action e-mail from Paul Begala:

Apparently, it didn’t take long for the “Grand Oil Party” to come unglued. After I called their fat-cat funders a bunch of dirtbags in my email to you on Sunday, they started squealing like a pig stuck under a gate.

House Republicans are crying so hard over my “dirtbag” comment, you’d think they just found out they were forced to spend the Fourth of July quail-hunting with Dick Cheney.

So I want to take a minute to do something I don’t do often enough: apologize. I am very sorry for calling those fat-cat plutocrat Republicans “dirtbags.” Doing so was grossly unfair. To bags of dirt. After all, dirt is good. Things grow from the dirt. I myself raise tomatoes and corn and pumpkins, jalapenos and cucumbers and lettuce - all from the good earth.

No, it was too kind, too generous to call them dirtbags. Probably better to call them oilbags or toxic-waste-bags or chemical-pollutant-bags. So I’m sorry.

Ha!

[As a side note, I didn’t really read the “from” at first, and from the sound of this, I expected it to be Carville.]

by tgirsch on July 03, 2008 04:44 PM

Even before the latest flooding, a group representing engineers said the United States needed to spend about $1 trillion more than it does now to bring infrastructure up to par with modern needs and standards.

Wow. A trillion dollars is a lot of money. But as it happens we have in fact an identified revenue stream that is more or less coincidentally projected to run just about that amount in cash surpluses over the next decade, and more than double that if you include interest accrued on the existing fund balances. That is if we take a little look at the dollar figures in the following table: Table IV.A3.—Operations of the Combined OASI and DI Trust Funds, Calendar Years 2003-17 1 [Amounts in billions]



So here is the deal. First I propose that we take all cash surpluses from FICA and invest them in interest earning state and local construction bonds. That alone gets you about $600-700 billion over the next decade (and all before Social Security is projected to run into a shortfall where cash income from tax falls behind cost). Assuming Intermediate Cost projections. Under Low Cost cash surpluses extend to 2023, and of course under outcomes better than IC but trailing LC you get dates in between. In any event we have a minimum ten year window to invest these already existing funds in infrastructure, and by reinvesting earnings on the muni bonds get pretty close to backfilling the whole gap. Because it gets better. Highway, bridge and school construction are all labor intensive undertakings, even more so when you take into account the wages of the people supplying the concrete and steel, to say nothing about the wages of the people who sell groceries and beer to the guys that spend their days working at the cement plant. Which is to say Social Security not only earns whatever return it gets directly on the bond, it also captures 12.4% of every contract dollar that ultimately goes to wages. Cha-ching!! I don't know how you would calculate the Return On Investment on that combination. But I suspect you are creeping real close to double digit returns.



There is a risk that the budgeteers, being deprived of this source of cheap borrowing, would simply respond by cutting transportation spending from the General Fund. But not only is this response not likely, it wouldn't really matter if it did happen. Why? Well follow me below the fold.





Why would a total spending offset be unlikely? Because Congressmen and Senators really, really like to take credit for infrastucture projects, that is how you get highways, bridges and airports named after you. If you set up a system where Social Security surpluses were invested evenly by Congressional District it would be hard for any individual Congressman to claim credit, after all it is just workers' money being reinvested creating jobs for workers. So I suspect some extra money would always be flowing, earmarks are not going away totally, transformed perhaps but not vanishing.



As to why spending offsets wouldn't really matter so much if they happened. Well as long as the total effect isn't negative, that is less net dollars going to these kind of projects, the total benefits far outweigh the foregone spending. But before we go there let me put stage two into play.



Along with using the current cash surpluses I would argue that the General Fund should take a proactive approach to the Trust Fund and invest an amount equal to the amount of the interest being accrued on the current Trust Funds into the Infrastructure Investment Fund. This would have the effect of freezing the Trust Fund in place at about $2.6 trillion (if we could get this done in 2029 2009). Which is not a bad thing, not at all. Freezing the Trust Fund means freeing our children and grandchildren from trillions of dollars in future General Fund debt. Of course they will be on the hook for paying off the transportation and school bonds but at least they will be able to see what they were paying for in literally concrete terms.



Now it is worth noting that funding for the Infrastructure Fund doesn't stop at the actual shortfall date when income from taxes trails costs, as long as the interest being earned on the Trust Fund exceeds the remaining gap the Infrastructure Fund would still be credited with the overage, under Intermediate Cost projections you would be getting some money from this mechanism all the way until 2023.



At which point we would need to make a decision. The easy answer would be to start drawing down on the assets of the Infrastructure Fund, that is rather than reivesting its earnings we could start using them in conjunction with Trust Fund redemptions to extend the period when the General Fund has to transfer cash. Or we could simply bite the bullet and pay for the entire gap between income from tax and cost by direct redemptions of the Special Treasuries. The net result would be that the Trust Fund would be reduced to its target of a 100 Trust Fund ratio even faster than projected. On the other hand this would give the Infrastructure Fund that many more years of compounding through reinvestment.



So what is the end game here? Well some fifteen to twenty years down the road we have us a Trust Fund holding its accepted minimum level of reserves, still presumedly held in Special Treasures. We also have a revenue stream via FICA and tax on benefits that was significantly augmented by additional wage dollars from the infrastructure investment in the meantime. Then we have an independent Infrastructure Fund that can be tapped to backfill any gap between then current income and then current cost.



I kind of like this picture. One it puts the intergenerational equity problem to rest for all time, current benefits would be paid out of a combination of current tax and current returns on real assets. Two it blows away the phony 'Phony IOU' argument. Three it shuts up those who would blather about how returns on equities magically out earn returns on Treasuries, they simply will not be able to match the reliability of munis at equivalent rates of return (or go for it in comments). Four and most interesting perhaps it moves financing of Social Security into progressive directions without it being turned into welfare. Because states and localities have two major sources of income: property tax and sales tax. Want to live in that big ass house, really need that thirty foot speedboat, or sixty foot cruiser, or houseful of designer furniture, or that Bentley? Well know that some portion of your property tax and sales tax is going to repay bond dollars borrowed from wage workers. Instead of approaching Mr. Rich cap in hand for a handout, Mr. Worker ends up in the position of creditor.



All in all a lot better way of securing some infrastructure funding over at least the near term than trying to raise it through the Lotto.

by Bruce Webb (noreply@blogger.com) on July 03, 2008 03:29 PM

Reader ddrew2u sends this post:



Readers of December's Popular Mechanics know that Stanford University scientists have already engineered a lithium ion enhancement that promises to multiply charge capacity ability about four times in the short term and as much as ten times in the long term.



For 30 years it has been known that building lithium ion batteries with silicon wires (instead of carbon wires) could yield ten times the power holding ability but, because silicon wires expanded and contracted too much as they cycled, they quickly destroyed themselves. The development of nano wires – about a thousandth of the width of a sheet of paper -- has solved that drawback -- while potentially making lithium ion batteries more stable (safer) at the same time!



Near term, only the anode side of the batteries will be manufactured with nano wires, yielding the quadruple jump (up powering GM’s Volt to go 160 miles on one charge instead of 40?). Long term, when the cathode side can be manufactured with silicon nano wires the ten multiple target is expected to be reached (introducing hybrid, long distant trucks?).



Maybe someone should donate a Popular Mechanics subscription to the McCain campaign -- could save the Treasury $300 million dollars.



Rdan here: Additional information below

Stanford researchers have found a way to use silicon nanowires to reinvent the rechargeable lithium-ion batteries that power laptops, iPods, video cameras, cell phones, and countless other devices.



The new technology, developed through research led by Yi Cui, assistant professor of materials science and engineering, produces 10 times the amount of electricity of existing lithium-ion, known as Li-ion, batteries. A laptop that now runs on battery for two hours could operate for 20 hours, a boon to ocean-hopping business travelers.



"It's not a small improvement," Cui said. "It's a revolutionary development."

...

The breakthrough is described in a paper, "High-performance lithium battery anodes using silicon nanowires," published online Dec. 16 in Nature Nanotechnology, written by Cui, his graduate chemistry student Candace Chan and five others.

...

"Usually people want low surface area to make batteries safe," says Mark Obrovac, senior scientist at the 3M Lithium Ion Battery Laboratory. "The surface area of a nanowire electrode must be astronomical." Adds Obrovac: "It's a great thing he's done making silicon cycle, but it will require a lot of work before we'll see this in a commercial application."



Research on silicon in batteries began three decades ago. Chan explained: "The people kind of gave up on it because the capacity wasn't high enough and the cycle life wasn't good enough. And it was just because of the shape they were using. It was just too big, and they couldn't undergo the volume changes."

I am a sucker for improvements that are part of a bigger system and catch me by surprise.

by rdan (noreply@blogger.com) on July 03, 2008 03:00 PM

The NYT notes the following on gun bans:

A decision by Georgia legislators to relax the state’s gun laws has led to a dispute over whether people can legally carry concealed firearms in the nation’s busiest airport, Hartsfield-Jackson Atlanta International.



A Georgia gun rights group filed a lawsuit in Federal District Court in Atlanta on Tuesday after airport officials said they would continue to enforce a ban on concealed weapons in the terminal despite the changes to the state law. The changes, which were approved by the Georgia legislature in the spring and took effect on Tuesday, relax the state’s prohibition on carrying weapons on public transportation and in some other areas, including restaurants serving alcohol.



Benjamin R. DeCosta, the airport director, said the changes applied only to public transportation like buses and the city subway and were not intended to allow people to carry guns at the airport. He said allowing civilians to carry concealed weapons in the terminal, which serves millions of travelers each year, would pose severe problems for the police and airport security workers.

Sorting out change for basic law is always a process. It certainly is an exception to the argument for an absolute right to carry in my mind.

by rdan (noreply@blogger.com) on July 03, 2008 02:40 PM

Update: Haloscan returns.



Sorry for the inconvenience, and hope the time is short.

by rdan (noreply@blogger.com) on July 03, 2008 12:28 PM

We've mentioned we are going to go to Alaska to watch the ice melt. That means no Internet from August 3 to August 10, inclusive, save maybe a visit to an Internet cafe to check e-mail.



Those who might want to try their hand at guest blogging (or have an established blog and would cross post) please contact me at yves@nakedcapitalism.com. Thanks!

by rdan (noreply@blogger.com) on July 03, 2008 11:54 AM

Hat tip to Barry Ritholz at the Big Picture for this link listing the 10 best gloom and doom sites.



1. Daily Reckoning

2. Clusterfuck Nation

3. The Big Picture

4. DollarCollapse.Com

5. Angry Bear

6. Mish’s Global Economic Trend Analysis

7. Naked Capitalism

8. Peter Schiff

9. GREG MANKIW'S BLOG

10. The mess that greenspan made



Barry had a note about Greg Mankiw being gloomy. It became quite apparent in the descriptions that we need to re-write our blog description and make it available on site for such occasions. More than just "left of center etc.".



Still, certainly in good company. Are we so gloomy folks?

by rdan (noreply@blogger.com) on July 03, 2008 04:03 AM

With hat tip to Amanda of Think Progress, NPR announces a way to “double your stimulus”:

Business is down 25 percent in Nevada's brothels, which depend on truckers who are now feeling the pinch of high gas prices. So the Shady Lady Ranch is offering gas cards to lure people in, and the Moonlite Bunny Ranch has a deal called "double your stimulus" for folks who bring in their federal tax rebate checks.

by PGL (noreply@blogger.com) on July 02, 2008 07:11 PM

It’s hard to believe any of the creeps, perverts, and sadists who connived at and then defended torture by the US military and intelligence services under the Bush administration can still maintain their dismissive and amoral charade. Over and over we have heard the reality of waterboarding and other shameful abuses. Over and over we have heard that these torture techniques were adopted from practices used by the most lawless enemies of the US, practices the US had formerly denounced as war crimes and had refused to countenance within our own doctrine. (Just today it was revealed that specific training materials for torture had been lifted wholesale from a Korean-war-era review of Chinese military torture techniques intended to elicit false confessions.) And over and over we have heard how inhumane and unbearable these techniques are, while smug psychopaths like Jay Baybee, John Yoo, and Alberto Gonzales dismissed such complaints and sickeningly passed off torture and abuse as some kind of game or inconvenience.

As if it has to be said again - and apparently it does - Christopher Hitchens volunteered to undergo a mild form of waterboarding and report his experiences in this month’s Vanity Fair.

more…



He concludes:

I apply the Abraham Lincoln test for moral casuistry: “If slavery is not wrong, nothing is wrong.” Well, then, if waterboarding does not constitute torture, then there is no such thing as torture

Tellingly, when he contacted an unnamed group of counterterroism veterans to ask for a demonstration, they first refused to even consider it when they learned his age (59), then demanded a medical clearance and legal release. His “interrogation” was pre-arranged and conducted without violence. His “captors” treated him with extreme gentleness and courtesy, calling him “sir” and repeatedly enquiring after his comfort and safety; the actual board he was strapped on was nearly horizontal, unlike in many cases of real torture. A paramedic checked him, and he was ordered to rest between torture sessions (he was able to undergo two, both lasting only seconds). He was given three methods of signalling an end to the torture, and tested repeatedly to be sure he could use them correctly; he was also reassured several times that the torture would end “immediately” the moment he signaled, and questioned to see that he understood this. (For some reason they also played electronic prog-rock in the background, the reason for which never became clear. This apparently is not addressed by the Geneva Convention.)

In short, Hitchens was given the most mild simulation of a so-called “simulated drowning”, under conditions aburdly short of an actual torture session or even the vaunted military SERE anti-torture training that defenders of torture point to as justification. Here is what he says about it:

You may have read by now the official lie about this treatment, which is that it “simulates” the feeling of drowning. This is not the case. You feel that you are drowning because you are drowning—or, rather, being drowned, albeit slowly and under controlled conditions and at the mercy (or otherwise) of those who are applying the pressure. The “board” is the instrument, not the method. You are not being boarded. You are being watered. . . .

In this pregnant darkness, head downward, I waited for a while until I abruptly felt a slow cascade of water going up my nose. Determined to resist if only for the honor of my navy ancestors who had so often been in peril on the sea, I held my breath for a while and then had to exhale and—as you might expect—inhale in turn. The inhalation brought the damp cloths tight against my nostrils, as if a huge, wet paw had been suddenly and annihilatingly clamped over my face. Unable to determine whether I was breathing in or out, and flooded more with sheer panic than with mere water, I triggered the pre-arranged signal and felt the unbelievable relief of being pulled upright and having the soaking and stifling layers pulled off me. I find I don’t want to tell you how little time I lasted. . . .

I said, with slightly more bravado than was justified, that I’d like to try it one more time. There was a paramedic present who checked my racing pulse and warned me about adrenaline rush. An interval was ordered, and then I felt the mask come down again. Steeling myself to remember what it had been like last time, and to learn from the previous panic attack, I fought down the first, and some of the second, wave of nausea and terror but soon found that I was an abject prisoner of my gag reflex. The interrogators would hardly have had time to ask me any questions, and I knew that I would quite readily have agreed to supply any answer. I still feel ashamed when I think about it.

There is a video here. It is hard to watch. Probably quite a lot of people would smile at the thought of Christopher Hitchens being tortured by agents of the insane and illegal war he cheered into being. It is tempting to view it as ironic justice. But I had tears in my eyes, watching just the first of those two brief sessions he describes. You are witnessing a man bound immovably in a position of utter vulnerability, slowly and deliberately being done to death in one of the most terrifying ways possible by calm technicians of sadism, until inevitably he reaches the point that he simply cannot control his own body or will - and would in fact die if he could manage to maintain such control.

Hitchens, by my watch, lasted 17 seconds before panicking in his first session, and apparently a shorter time in the second one. Both ended with his complete loss of will and self-control; he reported later he actually believed he was shouting the safety code word though in fact he did not, and he remarked also on how grateful he was to one of the torturers for a kind word:

As if detecting my misery and shame, one of my interrogators comfortingly said, “Any time is a long time when you’re breathing water.” I could have hugged him for saying so, and just then I was hit with a ghastly sense of the sadomasochistic dimension that underlies the relationship between the torturer and the tortured.

He also states that he is now subject to nightmares and waking terrors, to feelings of being suffocated while sleeping, and to panic attacks anytime he becomes the least bit over-exerted or short of breath. And remember, this was not merely an unrealistically mild torture session, it was something Hitchens himself had asked and agreed to have done, by people he trusted.

Hitchens - who has been pro-war but anti-torture consistently [UPDATE: Not that consistently; he has often equivocated by denying that certain forms of abuse were “torture”, or using euphemisms like “extreme interrogation”.]- does not stop to reflect on the relationship between the two. And while he notes the horrifying psychological destruction that arises when the victim becomes emotionally traumatized to the point of identification with the torturer, he does not seem to notice the ways in which pro-war sentiment has eroded the moral sensibility that once made torture unthinkable in this country (to the point that “they do it to us” is now used as a justification for our doing it ourselves). But he has done a service here - a service of physical and emotional courage - in telling us from the inside what toll this behavior takes, and how much of the fundamental sense of self that defines a person it destroys. The obscenity of this practice is captured as clearly here as anywhere, and it bears repeating that this demonstration was but a fraction of the actual reality documented, and apparently continuing by way of US personnel or under US authority, throughout the world today.

NB: Fox News undertook a similar demonstration a year and a half ago. Their reporter underwent a slightly different form of water torture, apparently conducted by people he knew personally, involving a series of phases” of increasing severity. “Phase 1″ consists of merely having water poured in one’s face; he repeatedly insists that it was only “annoying” and he felt fine - the videotape shows him panicking and struggling after 4 seconds and shouting “Stop!” after 13 seconds. He manages to get through 3 of a planned 5 phases, and as the phases escalate he panicks sooner each time. The reporter estimates that he “probably went about 30 or 40 seconds before I had to [signal to stop]” in Phase 2; in fact, it was about 12 seconds. In the third phase, after 10 seconds he states “This isn’t that bad” and then immediately begins struggling and gives up. (At one point he remarks to the camera “I don’t know how many [phase] numbers these guys got.” One of the torturers says menacingly “We’ve got a lot.”)

Being a Fox News tool, he keeps trying to minimize an experience that was clearly unendurable for him, and he himself says left him frightened and unable to continue. He says several times in one video clip that he recovered quickly from the waterboarding and felt physically OK soon after, in a sense that seems to imply that the practice is acceptable for that reason. But contrary to apologists’ claims that torture is acceptable if it isn’t permanent, or, in John Yoo’s clinically sadistic terms, doesn’t produce “death or organ failure”, the reason torture is wrong, as Hitchens sees clearly, is that it is torture. That is, it is one of the things that must not be done, for virtually any reason, because the thing in itself is so bad that it violates every decent moral norm (or, if you like, outweighs in moral import the value of whatever desperate lies and babblings it might generate).

Hitchens notes that, in just his first 17-second session of waterboarding, he would willingly have given up his family to make it stop. (He references 1984’s “Room 101″, where your torture is “the worst thing in the world”, to explain his own personal fear of drowning. It is worth recalling here the heartbreaking consequence of that torture at the end of the book: “Do it to Julia! Do it to Julia!”) But he also notes that it would be much worse for someone who didn’t know anything or was actually innocent: they would not know what to say to make it stop, and would eventually say anything they thought might help. On one hand, this creates the obvious drawback that torture is worthless as an interrogation technique (everyone talks, and anyone who can’t talk lies, so you are certain to get false information but have no way of identifying it); many critics of the practice have pointed out this practical problem. But the moral problem with torture is more severe: it erases the humanity of the victim, both in the mind of the torturer (they are seen as fit for inhuman treatment) and in the victim’s own mind (they are brought to do what, with their faculties intact, they might otherwise have died to prevent). Torture consists in doing to human beings what no one can have done to them and retain their moral identity; it is a violation of the one thing that must never be lost or broken, to have a moral self at all (and, it goes without saying, it is a forfeiture of that last inseparable value on the part of the torturers themselves). It doesn’t matter that the victim can survive it; what matters is that the victim does not endure while it is happening - it is the sacrifice of humanity itself, even if temporarily.

To be a moral person is to accept that there is something that one must not do - that one is constrained by bounds one cannot evade, in at least some things. Most people - even the very worst of us - never even approach the most absolute limits of moral behavior. It is shocking that we now debate whether it is possible not merely to murder people in the name of our government, but to destroy in them the most basic humanity that morality exists, at all, to protect.

by KTK on July 02, 2008 06:11 PM

Currently there is a disruption of some kind at haloscan. "Invalid poster" is not part of our scheme. All readers are valid and valued. This post will be removed when comments return to normal.

by rdan (noreply@blogger.com) on July 02, 2008 05:58 PM

For your debate and perusal, my All-Star Ballot (below the fold):

more…



AMERICAN LEAGUE:

• First Base: J. Morneau, MIN
• Second Base: I. Kinsler, TEX
• Third Base: A. Rodriguez, NYY
• Shortstop: J. Bartlett, TB
• Catcher: D. Navarro, TB
• Outfielder: J. Hamilton, TEX
• Outfielder: G. Sizemore, CLE
• Outfielder: B. Upton, TB
• Designated Hitter: A. Huff, BAL

NATIONAL LEAGUE:

• First Base: L. Berkman, HOU
• Second Base: C. Utley, PHI
• Third Base: D. Wright, NYM
• Shortstop: H. Ramirez, FLA
• Catcher: R. Martin, LAD
• Outfielder: C. Beltran, NYM
• Outfielder: R. Braun, MIL
• Outfielder: C. Lee, HOU

For the most part, I based these selections on offensive stats (mainly RBI, AVG, and SB). As you can see, I wasn’t a homer, having voted for only one Brewer, and a clearly deserving one at that. And I was even forced to do the unthinkable, voting for a Yankee.

But I figure this will give some grist for the mill, especially for guys like Ted and digglahhh who follow baseball a lot more closely than I do.

Also, I’d like to reiterate my objection against fan balloting in the All-Star game. It just doesn’t make any sense at all, and involves way too much homerism, not to mention ballot-box stuffing. Certainly, if you’re going to make the All-Star Game count (something I also object to), then you need to do away with the fan balloting.

Maybe later in the week I’ll do a “How To Fix The All-Star Game” post.

by tgirsch on July 02, 2008 04:15 PM

by Tom Bozzo



Not that I want to reinforce our doom-and-gloom reputation or anything, but the Bush administration is demonstrating its inability to walk and chew gum at the same time by losing in Afghanistan:

A recent Pentagon report about Afghanistan painted a stark picture of security conditions inside the country, a militant force that had “coalesced into a resilient insurgency” and a central government in Kabul that still could not extend its reach into the hinterlands. An American commander, Maj. Gen. Jeffrey J. Schloesser, has said that militant attacks on coalition troops increased by 40 percent from January to May compared with the same period last year.

The reason is that for the small fortune that's been appropriated for that war, there aren't enough resources there to keep the Taliban at bay:

General McNeill said the Afghanistan mission “needs more maneuver units, it needs more flying machines, it needs more intelligence, surveillance and reconnaissance units.”

The problem, as any student of the place would know, is that Afghanistan is the asymmetric warrior's paradise, with a long history prior to the Soviet invasion of chewing up notionally superior forces. Incidentally, this is part of the reason why the partisan in me would be almost as happy to see Condoleezza Rice as McCain's running mate as I would Mittens. Not only would I make a sizeable donation to anyone willing to run an ad featuring her recounting the title of the "Bin Laden Determined to Attack Inside the United States" memo, but also she must be either totally ineffectual and unprincipled [*] or the worst Sovietologist ever [**] not to have tried convincing the other Bushies to really win in Afghanistan first or to resign having tried but failed.



Comparing the candidates, Obama's Iraq page notes the rivalry for resources, and the plan (pdf) calls for shifting some U.S. military resources freed from Iraq to Afghanistan; McCain keeps Afghanistan off his Iraq page and seems to promote the blunter and more expensive instrument of a larger standing military as the answer to resource limitations in fighting the GSAVE.





[*] The unprincipled part is is pretty much a given.



[**] Before you start debating me on worse Sovietologists, please note the "worst X ever" formulation.

by Tom Bozzo (noreply@blogger.com) on July 02, 2008 01:21 PM

But it's difficult to argue with the rest of this piece.



Now I qualify as Gloom and Doom member?

by Ken Houghton (noreply@blogger.com) on July 02, 2008 12:45 PM

Tom's post yesterday about British housing (following Felix), where the volume was down significantly with the average slightly up, seemed rather intuitive if you buy the argument that the majority of house prices haven't been cut enough, and won't sell until they cut more.*



But, courtesy of our fellow Gloom-and-Doom maven, Barry Ritholtz at The Big Picture, we can see that prices rising as sales decline is not unique to housing:

Money quote from the ISM bossman: "When viewed from the manufacturer’s perspective, they are experiencing higher prices for their inputs while demand for their products is slowing."**

Take the extra money now, guys. You're going to need it as inventories accumulate.



*I don't buy that one completely, mainly because housing is not a liquid market unless it's bubblicious. Also, houses are not commodities: people react to them differently, and are more likely not to buy because of something other than price.



**There is a formatting issue at TBP that implies this is a quote from the NYT. It's not; it's original to TBP.

by Ken Houghton (noreply@blogger.com) on July 02, 2008 12:37 PM

Infrastructure - The Next Big Deal? #1



Reuters carries a report on an infrastrucutre concern:

The worst Midwest flooding since 1993 has generated images of swamped towns, cracked roads, washed-out bridges, overwhelmed dams, failed levees, broken sewage systems, stunted crops and water-logged refugees. The losses are in the billions of dollars and still mounting, as the costs of crop losses alone send shocks through the inflation-wracked world food system and threaten insurers.



The disaster has reminded policymakers of the decrepit state of U.S. infrastructure, stirring concerns similar to those following the deadly Minneapolis bridge collapse in 2007 and the flooding of New Orleans after Hurricane Katrina in 2005.



Even before the latest flooding, a group representing engineers said the United States needed to spend about $1 trillion more than it does now to bring infrastructure up to par with modern needs and standards.



"The patch-and-pray approach simply won't succeed," said David Mongan, head of the American Society of Civil Engineers.



But the group also said its five-year cost estimate was outdated and does not count the price of new roads, rails, and sewers required by a growing population, nor the cost to repair damage inflicted by the recent Midwest floods.



President George W. Bush has asked Congress for $1.8 billion to boost funds for flood recovery but it is unclear how much of that money will end up in infrastructure repair.



Presidential candidates vying to succeed him have each promised quick action in Congress and offered some ideas for the larger task of repairing infrastructure.





Democratic presidential candidate Barack Obama has proposed creating a $60 billion fund for infrastructure projects, funded by money saved by a promised withdrawal from the war in Iraq.



"This can be the moment when we make a generational commitment to rebuild our infrastructure," Obama told business executives in Pittsburgh last week.



Everywhere You Look



Each need sounds dire: new wastewater treatment so sewage does not taint the same waterways that supply drinking water; repairs or replacements for thousands of corroded bridges; new and repaired dams and levees that will not fail; and upgrades to airports and air traffic control.



"We need profound changes," said engineer Kumares Sinha of Purdue University. "We can't live in a fool's paradise."



While rising economic powers China and India build highways and other large projects, U.S. infrastructure - once the envy of the world - has fallen into decline, Sinha said.



Two federal commissions since Katrina have tackled the issue and Congress is mulling proposals for a full-scale assessment of the nation's infrastructure needs and an infrastructure "bank" to loan money for projects.



But Sinha and other experts said the analysis should go deeper to reflect an economy likely to face higher fuel prices for the foreseeable future. Policymakers need to consider new methods of reducing road congestion, for example, whether by charging more to use them or exacting fees for entering city centers, which will generate revenue for mass transit.



The nation also may have to reconsider its lukewarm commitment to passenger rail service, experts said.



Government funding for some infrastructure needs has declined, such as for wastewater plants. Municipalities hike taxes or fees to repair ancient pipes prone to bursting.



"Everybody is drinking somebody's waste water," said Susan Bruninga of the National Association of Clean Water Agencies.



The state of Illinois is weighing its first capital improvement project in a decade, hoping to back $31 billion in bonds by leasing the lottery and building a casino in Chicago.

Illinois will fund infrastructure through gambling monies?



(Another thought is how the floods have hit the corn and soybean market?)

by rdan (noreply@blogger.com) on July 02, 2008 12:05 PM

If you were wise enough to skip Jonah Goldberg’s attack on Obama’s patriotism - save your time and just check out the takedown from Jed Report:

In his trademarked pseudo-intellectual style, Jonah launches a full-on smear against Barack Obama, claiming that Barack has a "patriotism problem." To make his case, Jonah digs up a quote of Barack saying "I'm going to try to tell the American people what I believe will make this country great and, hopefully, that will be a testimony to my patriotism." … So Barack Obama has a patriotism problem because...he wants to to make the country great. Obviously, it's a stupid argument -- only someone who hates America would not want to make it great, and only the world's biggest idiot (which Jonah may well be) would suggest that America is right now as great as it has been in the past.

The world biggest idiot just had to respond with even more stupidity, which not only included how adding “again” makes all the difference but also this gem:

But the key difference is that invoking scripture, or similar language, in order to justify shrinking government at home and liberating mankind from collectivism abroad is quite different than invoking government to justify an enormous expansion of the state into people's lives. Reagan did not believe that government was the instrument of salvation, he believed it was the obstacle to what is best in ourselves and in our nation.

Credit to Andrew Sullivan for this:

"An enormous expansion of the state into people's lives". What does Jonah think Bush has been doing these past eight years?

But maybe Jonah is referring to Kudlow’s claim that Reagan cut government spending. Of course, other conservatives blame the Reagan deficits on an explosion of government spending. Funny thing – Federal spending as a share of GDP neither rose nor fell during the Reagan years. So when Jonah says “shrinking government at home” – he displays his world class stupidity once again.

by PGL (noreply@blogger.com) on July 02, 2008 10:21 AM

Andrew Sullivan finds the discussion of the oil market by James Surowiecki illuminating. I’m not so sure. Let me begin with this confusion:

Between 2000 and 2007, world demand for petroleum rose by nearly nine million barrels a day, but OPEC has been consistently unable, or unwilling, to significantly increase supply, and production by non-OPEC members has risen by just four million barrels a day.

But wait a second – doesn’t the quantity demanded equal the quantity supplied at the market clearing price? If Surowiecki is trying to say that the demand curve shifted outwards along a fairly inelastic supply curve – then maybe we have a pretty good explanation of the rise in oil prices. The Excel file from the Energy Information Administration has some useful information from 2003 to 2007 including total world demand and total world supply – which both grew by about 5 million barrels per day from 2003 to 2006. During this period, OPEC supply grew by almost 4 million barrels per day. Now from 2006 to 2007, world demand growth seems to have outstripped world supply growth with the difference being world demand and world supply being either reported draw downs of inventories or the “statistical discrepancy”. Given their data has most of this difference being the statistical discrepancy – it is hard to pin down precisely what their data is telling us.



Surowiecki argues against the usual suspects – market manipulation by greedy oil companies or speculative forces – and he’s likely correct. But then he argues:

But there’s also something else at work, which the oil guru Daniel Yergin calls a “shortage psychology.” The price of oil—more than that of many other commodities—isn’t based solely on current supply and demand. It’s also based on people’s expectations about future supply and demand, because those expectations determine whether it makes sense for oil producers to sell their oil now or leave it in the ground and sell it later. Currently, the market is assuming that oil will become scarcer, and that global demand will keep rising, especially in rapidly developing countries like China and India. As a result, producers are asking very high prices to pump their oil. Now, it could be that these assumptions are all wrong—that the supply of oil will not be constricted going forward, that concerns about the Middle East are exaggerated, and that higher prices will lead people to cut back on energy consumption, shrinking demand. In that case, oil would turn out to have been hugely overpriced. But that won’t be because of sinister speculators; it will be because oil producers and oil users collectively misread the future.

Why would anyone assume that the assumptions of rising world demand and shrinking supply be wrong? What if they are correct? Then couldn’t the current market price be a rational response to these rational expectations? Which might leave one to argue that allowing the market to work is the preferred policy to all the nonsense we are hearing from politicians such as John McCain.

by PGL (noreply@blogger.com) on July 01, 2008 05:32 PM

THIS LINK to NSDIC will update you on the state of the Northwest Passage.

What does this online analysis provide?



The online information we offer in this section includes:



Daily images of near-real-time Arctic sea ice conditions (above right)

Monthly scientific analysis year-round, with more frequent updates during the melt season or as conditions warrant

Previous news and analysis and general information about sea ice (right navigation)

RSS feed for automatic notification of new analyses.

Please credit the National Snow and Ice Data Center for image or content use unless otherwise noted beneath each image. Sign up for the Arctic Sea Ice News RSS feed for automatic notification of analysis updates.

Update: Hat tip to reader Jim Sattersfield for this link to Geology.com.







There is also a short history of three trips through the Passage.



Update 2: Tx1 sends this chart on temp and CO2:







Update 3: Long term CO2 and temperature

by rdan (noreply@blogger.com) on July 01, 2008 03:59 PM

PEER notes that:

On April 30, 2008, the U.S. Interior Department proposed to repeal nearly century-old national park rules requiring that firearms be unloaded and unavailable for ready use. In its place, the Bush administration would substitute the various laws governing “any state park, or any similar unit of state land, in which state the federal park, or that portion thereof, is located…”

....

The current National Park Service (NPS) regulation was re-written in 1983 under the Reagan administration and was intended to relax earlier strict prohibitions. As the NPS then explained: “[T]he Service has determined that it is not feasible to prohibit the possession of weapons in all situations, and a total prohibition would be unenforceable” (48 FR 30256). The current regulation (36 CFR 2.4) reads –



“…unloaded weapons may be possessed within a temporary lodging or mechanical mode of conveyance when such implements are rendered temporarily inoperable or are packed, cased or stored in a manner that will prevent their ready use.”



It is precisely these sort of rules that the majority opinion in the Supreme Court ruling in the District of Columbia v. Heller case appears to uphold when it denied that the decision would affect “laws forbidding the carrying of firearms in sensitive places such as schools and government buildings” (at 54).



Since its origin, the national park system has forbidden or severely restricted hunting, making carrying restrictions a key anti-poaching strategy.

While the US Supreme Court decision in District of Columbia vs. Heller ascribes an individual's right to possess a firearm in the home for defense, the NRA has said it will challenge gun laws in many states based on the ruling.



Many in the NRA appear to believe in an absolute right to own guns, but would be reluctant to claim it since there are some obvious exceptions that seem pretty reasonable for individuals depending on age, mental capacity, danger to society, and such.



Would someone please explain to me the difference between being allowed to carry a loaded gun in a park versus one tucked away "not available for ready use"? I for one would not like people carrying firearms ready for use as we stroll looking at the deer, or walking up the Lincoln Memorial.



Update: STR and Mcwop say: "Most firearms owners only want common sense. Most of the time law enforcement officials show common sense, but sometimes not."

by rdan (noreply@blogger.com) on July 01, 2008 03:18 PM

Felix Salmon found it quite odd, after weighing the roles of sellers holding out for peak prices and weird index (average) behavior, that the house price index for England and Wales managed to register a small increase — though considerably less than measured inflation — despite a dramatic collapse in sales volume.



England probably does enjoy more than the usual weird average behavior, thanks to the relative size of London. House price appreciation also happens to have pretty much come to an end essentially everywhere else:





Source: landregistry.gov.uk.



The fun thing is to compare the U.S. Here's Calculated Risk's picture of U.S. existing home sales, seasonally adjusted and annualized. Here's a picture Charles Calomiris posted at Vox EU back in November under a subhead "Reasons to be cheerful." (!!1!) If you don't want to click the links, the story is that the peak of existing home sales was in mid-2005, whereas the Case-Shiller indexes peaked a year later. And as of Calomiris's writing, the OFHEO index was still at a point where Calomiris could write...

At the moment, it is not obvious that housing or other asset prices are collapsing, or that leverage is unsustainably large for most firms or consumers.

...and it arguably was a matter of geek warfare to point out that he was whistling in the graveyard. Heh, well, crazy as things got here, the English bubble has on its face been a lot worse. The average detached house in England and Wales is £275,000. Sure, the mean is not robust, but still, that's pounds! To the extent the Fed is in a bind, things should be really fun these days over at the Bank of England.

by Tom Bozzo (noreply@blogger.com) on July 01, 2008 01:14 PM

The NYT has an article of interest on creating new efficiencies not often discussed as policy. I think a savings of 10% (20%?) or more is significant.

With the new refrigerators with the shelf in the door, these fit nice,” said April Buchanan, who was shopping at the Sam’s Club here. Others, even those who rue the day their tried-and-true jugs were replaced, praised the lower cost, from $2.18 to $2.58 a gallon. Sam’s Club said that was a savings of 10 to 20 cents a gallon compared with old jugs.

...

He spoke while standing in pools of the soapy run-off from milk crates that had just been washed. About 100,000 gallons of water a day are used at his dairy clean the crates, Mr. Soehnlen said.



But with the new jugs, the milk crates are gone. Instead, a machine stacks the jugs, with cardboard sheets between layers. Then the entire pallet, four layers high, is shrink-wrapped and moved with a forklift.



The company estimates this kind of shipping has cut labor by half and water use by 60to 70 percent. More gallons fit on a truck and in Sam’s Club coolers, and no empty crates need to be picked up, reducing trips to each Sam’s Club store to two a week, from five — a big fuel savings. Also, Sam’s Club can now store 224 gallons of milk in its coolers, in the same space that used to hold 80.

If I had wanted this post to be noticed, I should have labeled it "Alien jugs reaping benefits".



Actually, I wonder what other designs in packaging could be significant, in addition to less use of material. I remember when items were in a jar, or hung on a hook. If stealing remained constant with old formats, what would savings be on the before and after side of the equation?

by rdan (noreply@blogger.com) on July 01, 2008 10:05 AM

Update: Shell's in-situ R&D







Update 2: One description of the process, with attendant energy costs.



Update 3: Then of course the Oil Drum analysis takes time to read.



Update 4: Vtcodger sends this cool link giving us some history, geology, and current synopsis of processes at extraction. Update 2 describes Shell's attempts in more detail.



The Rocky Mountain News reports on oil shale development moratorium from last May:

The Senate Appropriations Committee today narrowly defeated Sen. Wayne Allard's attempt to end a moratorium related to oil shale development in Colorado.

It was a big day for Colorado energy issues on Capitol Hill as Gov. Bill Ritter testified before a senate committee asking lawmakers to move cautiously on oil-shale development until more is known about the environmental impact and other issues.

Meanwhile downstairs, the appropriations committee was considering a massive Emergency Supplemental Spending Bill. Allard, a member of the committee, attempted to insert an amendment that would reverse the moratorium that lawmakers approved late last year.

The moratorium prevents the Department of Interior from issuing regulations so that oil companies can move forward on oil-shale projects in Colorado and Utah. Allard said the moratorium has left uncertainties at a time when companies need to move forward and in the long term make the United States more energy independent.

"If we are really serious about reducing pain at the pump, this is a vote that would make a difference in people's lives," Allard argued.

But in a 14-15 vote, the committee spilt strictly on party lines and rejected the amendment.

One of the key votes was from Sen. Mary Landrieu, D-La., who said Sen. Ken Salazar had urged her to reject the amendment even though she personally thinks the moratorium on oil-shale development is unjust.

Landrieu vowed to try to lift the moratorium when the large appropriations bill reaches the floor of the U.S. Senate in coming weeks.

Hat tip to The NYT on the request for a two year process for environmental impact statements on solar mega watt projects (130 licences) before issuing licenses to proceed. Tax credits are due to expire this year for solar purchases.



Yet just last week, Interior Secretary Dirk Kempthorne saw fit to stand next to President Bush in the Rose Garden when he called on Congress to allow development of oil shale on public lands in the Green River Basin which straddles Colorado, Utah and Wyoming. Department of Interior web site has news on both subjects, and a photo op for shale oil. In the 2005 Congressional intitiative to explore the possibility of development, impact statements are still in process but further along closing public comment last March.



Bush complained that Congress has blocked the leasing of federal lands for oil shale development.



It is also hard for me to imagine that mountain top removal for coal mining is comaparable in impact.



I could be wrong, since such projects in solar are new...then again, so are oil shale commercial processes.

by rdan (noreply@blogger.com) on June 30, 2008 10:20 PM

Will post-autistic economics review (who have, sadly imnvho, renamed themselves "real-world economic review) or The Economists' [sic] Voice be the first to publish Robert Waldmann's paper (a readable version of this blog post, which now also links to the paper)?



Only Brad DeLong may know for certain. But you should read it now.

by Ken Houghton (noreply@blogger.com) on June 30, 2008 09:49 PM

Commenter John Spragge, at Obsidian Wings:

Frontier settlers needed guns to protect them from Indians the way people making unauthorized bank withdrawals today need guns to protect themselves from guards, tellers, and police officers.

Heh!

by tgirsch on June 30, 2008 08:36 PM

Paul Krugman has been double checking some of the claims from the folks at the National Review who have blamed speculators for the high price of oil since even before the invasion Iraq. For example, Frederick P. Leuffer was saying oil prices were too high back in early 2003:

Extraordinary events are now holding oil prices high. The uncertainties of potential war with Iraq and the Venezuelan oil workers’ strike have put a premium on oil prices of more than $10 a barrel (the barrel price at this writing was $36.06). In addition, colder-than-normal temperatures this winter and severe storm activity in the Gulf of Mexico last fall worked to wither commercial petroleum inventories to low levels, particularly in the U.S. All these factors have helped ratchet prices upward ... Following Desert Storm, oil prices plunged, the stock market soared, and oil stocks underperformed. There's no reason to think that same scenario won't play out in 2003.

OK – this fool thought the Iraq War was going to be quick and easy - sort of like the fool named William Kristol. But what about the fool known as Lawrence Kudlow who wrote two years later, the following:

When I put a $55 barrel of oil on the table and look at it from all angles, there’s no way the current price can be justified. As a free-market disciple, I am compelled to accept the market’s verdict: $55 a barrel. But that doesn’t mean it’s going to last … The fact that oil has increased so much more than these commodity and financial-asset prices is important. It suggests that the oil sector is way out of line. Increased China demand cannot alone explain it — over-speculation is also a culprit.

We have provided a graph of oil prices since early 2003 to see how well their forecast of falling oil prices has panned out.

by PGL (noreply@blogger.com) on June 30, 2008 05:18 PM

The right wng is going to go after General Clark very hard because of this:

SCHIEFFER: Can I just interrupt you? I have to say, Barack Obama hasn’t had any of these experiences either, nor has he ridden in a fighter plane and gotten shot down.

CLARK: I don’t think getting in a fighter plane and getting shot down is a qualification to become president.

The reason that they wil go after Clark on this for two reasons: it is absolutely correct and it destroys the rationale for McCain’s candidacy. Military service on the front lines — while generally admirable — really says very little about whether a person would make a good commander in chief. Being President is about laying out sound policy, planning ahead, being able to decide between many options, choosing advice and advisers well, managing the various bureaucracies, and knowing how to rally the country to a position you think is correct. Some military men learn those traits, some do not. The mere fact of appearing in combat does not mean that a person has learned or been born with all of those skills.

And that simple fact is a huge problem for the McCain campaign. Because McCain has been trying to imply otherwise since the beginning of the campaign. He habitually talks about his time in the service and what he suffered for his country. When he was on the wrong side of the new GI Bill, he explicitly used his service as a means to attack Senator Webb. McCain does this in an attempt to make criticism of his military or foreign policy stances off limits and to hope that the constant drumbeat of his military resume will serve to hide his actual record on foreign policy.

See, recently McCain had a chance to prove that his life and military service had helped him grow and learn and become worthy of the Presidency. McCain failed that test. When it came time to decided whether to get caught up in the sideshow of the neo-cons’ Iraq delusions or to re-concentrate on the real threat to American security he backed the neo-cons. If there is another terrorist attack on this country, as the McCain camp seems to think is both inevitable and good for them, it will be becasue, in part, John McCain helped Bush divert the full attention of the US form Al Qaeda and then created a recruiting and training ground in the middle of the Middle East for them. McCain failed the Presidency test when it came; he doesn’t have any other option but hope his past service can be used to hide that from current voters.

by Kevin on June 30, 2008 03:42 PM

Yves Smith quotes Thomas Friedman accidentally telling the truth:

Since President Bush came to office, our national savings have gone from 6 percent of gross domestic product to 1 percent, and consumer debt has climbed from $8 trillion to $14 trillion.

Please explain this in the context of the "savings and investment boost" that was supposed to come from the 2001 and 2003 tax cuts.



That means you, Bob McTeer.



Bulldog to bulldog, as it were.

by Ken Houghton (noreply@blogger.com) on June 30, 2008 11:52 AM

The Economist reported this article on forthcoming issues gaining momentum:

For the past few years it has been hard to ignore America’s crumbling infrastructure, from the devastating breach of New Orleans’s levees after Hurricane Katrina to the collapse of a big bridge in Minneapolis last summer. In 2005 the American Society of Civil Engineers estimated that $1.6 trillion was needed over five years to bring just the existing infrastructure into good repair. This does not account for future needs. By 2020 freight volumes are projected to be 70% greater than in 1998. By 2050 America’s population is expected to reach 420m, 50% more than in 2000. Much of this growth will take place in metropolitan areas, where the infrastructure is already run down.

...

How can all this be fixed? In January a national commission on transport policy recommended that the government should invest at least $225 billion each year for the next 50 years. The country is spending less than 40% of that amount today. Yet more important than spending lots of money is spending it in better ways.

...

There is reason to hope. Beyond the campaign trail, many politicians have made infrastructure a big issue. Mr Obama’s infrastructure bank is a variation on a scheme that Chris Dodd, a Democrat, and Chuck Hagel, a Republican, introduced in the Senate last year. (The bill, is still pending.) In the House, Earl Blumenauer has proposed a commission to guide infrastructure investment. Ed Rendell, Arnold Schwarzenegger and Michael Bloomberg, the political juggernauts in Pennsylvania, California and New York City respectively, have launched a coalition to make infrastructure a national priority.

The Economist stated the John McCain has not stated a policy. A quick check on his website did not turn up a statement. If there is one, please let me know.



Mostly Economics began a definition of infrastructure from one point of view which seemed pertinent. I am sure there are better, but this is a start.

I had sometime back read an article by Vinayak Chatterjee of Feedback Ventures where he said let us define infrastructure first, before we build it.



I came across this document in Committee on Infrastructure’s website which attempts to do the same.



It first summarises definition of infrastructure from six different sources and then concludes what all is to be included:



(i) Electricity (including generation, transmission and distribution) and R&M of power stations,

(ii) Non-Conventional Energy (including wind energy and solar energy),

(iii) Water supply and sanitation (including solid waste management, drainage and sewerage) and street lighting,

(iv) Telecommunications,

(v) Road & bridges,

(vi) Ports,

(vii) Inland waterways,

(viii) Airports,

(ix) Railways (including rolling stock and mass transit system),

(x) Irrigation (including watershed development),

(xi) Storage,

(xii) Oil and gas pipeline networks.



And what all it does not include which other sources include (from the table on last page):



Housing

Urban services; as street lighting, Solid Waste Management (SWM)

Mining

Aircrafts

Vehicles, trucks, buses etc.(Road Transport System)

Industrial Park/SEZ

Educational Institutions

Hospitals

Posts

by rdan (noreply@blogger.com) on June 30, 2008 10:00 AM

Go to Hunger Action Center.

by rdan (noreply@blogger.com) on June 29, 2008 06:23 PM

Just to put things in perspective. This is through the first quarter so it does not reflect the last pop in energy prices.





It is now 6.6% as compared to a low of 4.2% at the double bottom and the 1970s low of 6.2%.

The peak was 9.3%.

by spencer (noreply@blogger.com) on June 29, 2008 03:39 PM

It is my understanding that the major byproduct of ethanol is distillers grains that are used as feed for cattle, hogs and chicken with essentially the same nutritional value as feed grains that have not had ethanol distilled out of them. All distilling ethanol does is remove the starch from the food grains and leaves the protein, etc, that animals need to grow.



This means that the use of corn or other feed grains being used to produce ethanol does not divert feed grains out of the food chain.





A bushel of corn can be used to generate x pounds of beef or it can be used to generate z gallons of ethanol and almost the same x pounds of beef.



Doesn't this imply the argument I see on economic blog after economic blog that ethanol production is playing a significant role in higher food prices is incorrect.



Rather the Department of Agriculture and/or Bush Administration argument that ethanol production plays an insignificant role in the current run up in food prices is correct.



Does somebody have reasonable evidence that this analysis is incorrect?



UPDATE !!!!



The beauty of the new world of the internet.



while I was looking into this question I ran across a very good article by Richard Perrin at the University of Nebraska on Ethanol and Food Prices

http://digitalcommons.unl.edu/ageconfacpub/49/

ABSTRACT:

Food prices in the U.S. rose dramatically in 2007 and early 2008. Given the integration of the world markets for foodstuffs, prices increased around the world as well, leading to riots in a number of countries in early 2008. The popular press has tended to attribute these food price increases to demand for corn by the ethanol industry. Grain prices are one determinant of food prices, but they constitute less than 5% of food costs in the U.S.(a higher percentage elsewhere.) This paper focuses on the likely relationship between ethanol and food prices, ignoring the potential role of other important contributors. It finds that ethanol is responsible for no more than 30-40% of the grain price increases of the last 18 months. Food prices in the US increased about 16% over the last five years,7% over the past 18 months, but rising grain prices have contributed only about a 3% cost increase over these periods. It is reasonable to conclude that ethanol is responsible for increases in US food prices about 1% in the last two years – a relatively small proportion of actual of U.S. food price increases. In food-insecure areas of the world,however, the impact of ethanol on food prices has been higher, perhaps as much as a 15% increase, simply because the typical food basket in those areas contains more direct grain consumption.

so I sent him an email with my question and he was nice enough to respond with this:

You are right. One-third of the corn processed for ethanol is expelled as distillers grains and solubles (DGS.) (One third is ethanol, one-third CO2.) DGS has slightly higher feed value than corn when it's fed to ruminants (I have a publication with an animal scientist on this issue, if you become deeply interested, and could direct you to some others.) Since DGS can be directly substituted for corn, putting a ton of corn into an ethanol plant really only extracts 2/3 ton from the animal feed supply, so it would have been reasonable for me to assert that ethanol has accounted for only 30% of new net withdrawals of the world's coarse grains since 2000 (rather than 40%.) China, Sub Saharan Africa, and South America are each responsible for about 15%.

So the standard treatment of ethanol in the press and blog is significantly misleading.

by spencer (noreply@blogger.com) on June 28, 2008 09:37 PM

Who is Robert Myers? Well prior to this morning I couldn't have told you. But here is an abbreviated job history.



Junior Actuary, Committee on Economic Security 1934-35

Various Actuarial Positions, Social Security Board 1936-46

Chief Actuary, SSA 1947-1980

Member, National Commission on Social Security 1978-81

Deputy Commissioner, SSA 1981-82

Executive Director, National Commission on Social Security Reform 1982-83



That is this guy was there before the beginning and remained through the Greenspan Commission and so is uniquely placed to tell us what was in the mind of the Commission. His Oral History is recorded here: http://www.ssa.gov/history/myersorl.html



The story of whether the Commission was solely concerned with short term vs long term or whether they thought they were prefunding is maybe not as simple as I have suggested. So I just want to give it in Myers own words and reserve my thoughts for comments. But I did bold some things for emphasis.



(BTW I have only begun to tap this resource. Myers has lots of interesting insights and I recommend reading the whole interview.)

Q: Let's talk about some of the provisions in that final consensus package. One of the big things in there, and that eventually became a part of the '83 amendments, was a move from pay-as-you-go financing to a partial reserve funding approach. Tell us about that.



Myers: Maybe you noticed that I winced a little as you said that, because it's not correct. But it has often been described in that way, so I am not being critical of you.



In the '72 amendments the system was changed to be on a pay-as-you-go basis. The '77 amendments changed this to some extent by providing for the building up of a sizable reserve, but not in the early years unfortunately. In the mid-'80s, and particularly in the 1990s, if everything had worked out, it would have built up a very large fund. So in practice, the pay-as-you-go result would have been there for the first 5 or 10 years but the underlying financing mechanism was to build up a reserve. Now over the long run, it would hav