Saturday, May 29, 2010

Dowd on Obama's Flaws

Maureen Dowd hits the nail on the head and hammers the point home on her latest NY Times op-ed: Obama needs to get ahead of the crowd, show feeling, and lead:
President Spock’s behavior is illogical.

Once more, he has willfully and inexplicably resisted fulfilling a signal part of his job: being a prism in moments of fear and pride, reflecting what Americans feel so they know he gets it.

“This president needs to tell BP, ’I’m your daddy,’ “ scolded James Carville, a New Orleans resident, as he called Barack Obama’s response to Louisiana’s new watery heartbreak “lackadaisical.”


In the campaign, Obama’s fight flagged to the point that his donors openly upbraided him. In the Oval, he waited too long to express outrage and offer leadership on A.I.G., the banks, the bonuses, the job loss and mortgage fears, the Christmas underwear bomber, the death panel scare tactics, the ugly name-calling of Tea Party protesters.

Too often it feels as though Barry is watching from a balcony, reluctant to enter the fray until the clamor of the crowd forces him to come down. The pattern is perverse. The man whose presidency is rooted in his ability to inspire withholds that inspiration when it is most needed.


F.D.R. achieved greatness not by means of imposing his temperament and intellect on the world but by reacting to what the world threw at him.

For five weeks, it looked as though Obama considered the gushing that became the worst oil spill in U.S. history a distraction, like a fire alarm going off in the middle of a law seminar he was teaching. He’ll deal with it, but he’s annoyed because it’s not on his syllabus.
I'm greatly relieved that an Obama is running the US and not the disasterous Bush. But I'm pained and unhappy that Obama, who promised to deliver so much, has low-balled the estimates and delivered only modestly. He has so much potential, but he isn't delivering the leadership needed. It is a tragedy.

To be fair, not all the problems of leadership are Obama's fault. He is working in a poisonous environment where the Republicans would rather sabotage the ship of state than allow the Democrats to govern efficiently. Here is a discussion of the problem from James Fallows on his blog:
As you may have heard elsewhere, the Obama Administration has been relatively slow in vetting and choosing nominees for many of its important posts -- but then has encountered extreme slowness from the Senate in approving the appointments once they get made. If you go to this White House site, you'll find a searchable, sortable list of all 820+ nominations and appointments made so far in the Administration; about 240 have not even come up for a Senate vote. If you go to this U.S. Senate site and click on the link for "Executive Calendar," you'll get a long PDF showing in its "nominations" section the scores and scores of people who have come through committees but not received a vote on the Senate floor. (Direct link to the PDF here.)

On Thursday afternoon, just before its Memorial Day recess, the Senate had planned to consider about 80 of these nominations as a group. They all had been through financial and security vetting; they had been through committee consideration; they were headed for jobs that in many cases now stood vacant; they were ready to go. Sen. Tom Harkin, Democrat of Iowa, moved for approval by unanimous consent, apparently believing that a deal to clear out the huge backlog had been struck. Sen. Mitch McConnell, the minority leader, begged to differ. He was still sore about the recess appointment of Craig Becker to the National Labor Relations Board. Therefore he wouldn't agree to the en-bloc vote. As he put it:
Unfortunately, we are snagged over one particular nomination which has already been defeated by the Senate, and that was the nomination of Craig Becker to be on the NLRB. The President then recessed Mr. Becker and recessed a Democratic nomination to the NLRB but not a Republican nominee to the NLRB. There is a fundamental lack of equity and fairness involved, and that has been a significant hindrance in coming to a consent agreement.
Fundamental lack of equity and fairness, indeed. Among other points, the nomination was not "defeated" by the Senate; the Democrats couldn't get the 60 votes to break a filibuster, which is different. After the jump, the extended exchange between McConnell and Harkin, which ends with a remarkable peroration by Harkin on what "fairness" has come to mean.

Apple & Steve Jobs, the Monopolist

Here's Cory Doctorow, a guy who lives by ethical rules, taking on Apple and Steve Jobs who live by the rule of the jungle ("the powerful devour the weak")...

I'm a really big fan of Cory Doctorow and his cause, the fight to keep copyright and other "intellectual" property rights under control so that ordinary people can do ordinary things without fear. The laws are too skewed to the advantage of big corporate interests who totally disregard the "little guy" and their need to access culture without all the legal barricades that corporate lawyers love to lay down. I think Cory Doctorow is not just talking the talk, but walking the walk. Others should follow his lead.

How Washington Works

Here's a bit from a post by Robert Reich on his blog that spells out what big Wall Street money is trying to buy:
The most important remaining battle to rein in Wall Street is over Senator Blanche Lincoln’s measure to stop the big banks from being subsidized by taxpayers for their risky derivative trades. Miraculously, it’s still in the bill but it’s on life support. The bill has now gone to the conference committee where differences between the House and Senate bills are to be ironed out.

But official Washington (read: dependent on Wall Street for money) is dead set against it. Even Barney Frank — who Massachusetts voters used to consider a reliable progressive until he became chair of the House Financial Services Committee — has vowed to kill Lincoln’s provision. And the White House says the measure is “not core,” which in Washington-lingo means “you’re free to dump it.”

Big, big money is at stake. Wall Street’s five largest banks have a corner on the trade, raking in about in about $30 billion in over-the-counter derivatives last year. It’s the single largest reason they’re too big to fail. So they’re spending like mad on Washington lobbyists and campaign donations in order to keep the subsidy in place. (Lincoln’s provision doesn’t force them to give up derivative trading, by the way; it only forces them to do it in a separate entity that doesn’t get subsidized by deposit insurance or the Fed’s discount window).

All the guns are aimed at this measure. But it’s still possible that the people can prevail, if we’re organized and active.
I sure hope people get active and deluge their representatives with e-mails, letters, and phone calls. That is the only antidote of the "little guy" to the big money that is buying Congressmen.

How Unfair!

Here is a right wing economist, Gregory Mankiw, George Bush's head of the Council of Economic Advisors (yeah, the one that help set up The Great Recession!) pointing to a chart that "proves" that taxing the rich is just down right unfair. Take a look. It is "obvious"!

Look at those slackers in the lowest 20th percentile. They aren't paying any taxes! Why not? Oh, they don't even earn enough for food and shelter. Well, "fairness" means they should sell their children into slavery like in the "good old days" to make them pay their "fair share". That's the Greg Mankiw viewpoint as best I can tell.

Meanwhile, those poor people in Mankiw's favoured camp, the ones in the 95th to 99th percentile. Woe is them! Thes 4% segment of the population is earnly "only" 30% of all the income but they are being forced to pay 40% of the taxes. How "unfair"! It creates an obvious hardship. For example, consider this situation in Colorado (these numbers are WAGS -- wild ass guesses -- to make the point, they aren't accurate, only reasonable guesses):
  • A big corporate CEO is making $200 million per year and is being forced to pay $50 million in taxes. This is a real hardship! The poor fellow has to make do on only $150 million per year.

  • A minimum wage fellow earning the Colorado $7.24/hour with a wife and 4 kids. He works one regular job 40 hours per week, 52 weeks a year with no vacation making $15,059.20 and then works a temporary job for 10 hours a week 52 weeks a year at minimum wage to pull in another $3,764.80 for a grand total of $18,824. He pays some taxes, but mostly just FICA. He is left with $15,000 to feed, house, cloth, educate, etc. his family. Greg Mankiw thinks this slacker should pay maybe $3,000 more per year in taxes so that the burden can be lifted from the "oppressed" $200 million/year worker.
That is the vision of "fairness" of a right wing ideologue. Actually, a fairly mild ideologue (see here) compared to some real nut cases on the right who would diminish the relative taxes on the rich guy because "he is producing jobs" while increasing them even more on the poor fellow to punish him for "lack of initiative".

One gauge of who "progressive" the concept of a flat tax is can be obtained by looking at who practices this "innovative" and "progressive" thinking. Take a look here.

It is really simple to say "everybody should pay the same taxes". But if you go look in your Bible at a famous case where the judge, in this case Solomon, decided that everybody should share the burden equally and share the rewards equally -- the famous case of the two women claiming a right to an infant, and which Solomon "solved" by deciding to have the baby cut in half -- you get the idea of the idiocy of the "fairness" that the political Right in the US is demanding. Superficially it sounds "fair" but if you think about it, it is nutty.

Perspective on the Recession & Inflation

Here are some bits from a good article by Harold Meyerson in the Washington Post:
Of all the gaps between elite and mass opinion in America today, perhaps the greatest is this: The elites don't really believe we're still in recession. Or maybe, they just don't care.

How else to explain the continual harping on the deficit by editorialists, centrist think tanks and the like when the nation is still enmeshed in the most serious economic downturn since the 1930s? How else to understand the growing opposition to the jobs bills Congress is set to vote on this week, particularly when nobody has identified any future engine of American economic growth save countercyclical public investment?


Of course, no one at any point on the political spectrum has a complete prescription for what ails the American economy. But we do know how to preserve and create enough jobs to keep a recession from becoming a depression and, more particularly, how to keep still-reeling state and local governments from deepening the downturn by laying off thousands more workers. We did just that last year: The Obama stimulus Congress passed last winter saved or created what most economists estimate to be roughly 2 million jobs. For that matter, every major nation enacted a Keynesian stimulus last year, preventing a return to the agony of the 1930s.

These are achievements that the more nuanced deficit hawks acknowledge. But consider what happens when the question is whether the medicine that worked in 2009 should be taken again, in the smaller doses, in 2010, as the legislation before Congress this week would have it. The official unemployment rate is 9.9 percent; there are still more than five unemployed job seekers for every opening; and a record percentage of the unemployed have been jobless for more than six months.

Yet the deficit hawks' rejoinder is essentially: So what? Government spending is out of control. We need to cut back now.

The problem with this ostensible solution is twofold. First, it conflates short-term deficits needed to stanch the recession with long-term issues of fiscal sustainability. Such thinking risks turning a short-term recession into long-term stagnation, much as Japan did in the 1990s by failing to stimulate its economy sufficiently. Second, it calculates the dollar cost of the stimulus but neglects to factor in the dollar benefit from, for instance, keeping hundreds of thousands of teachers, police and firefighters on the job and paying taxes rather than collecting unemployment insurance. Once such particulars are accounted for, a new study from the liberal Economic Policy Institute argues, the cost of the jobs created in the bill coming before the House this week is more than halved, from $75 billion to $35 billion.

Those who oppose the jobs bills in the House and Senate this week should be compelled to answer some questions, starting with: Absent more stimulus, what do they see as the plausible engine of economic recovery? What effect will laying off as many as 300,000 teachers have on the education of American children? And, more elementally, don't they know there's a recession on?
Go read the original article to get the whole story and the links to underlying data.

The theme of "deficit/debt" and "inflation" worry is bizarre. You don't worry about water damage when fighting a fire with water hoses. You wait until the fire is knocked down, then start worrying about unnecessary water damage. During the conflagration the immediate concern is the fire. These inflation/deficit fanatics are like people trying to turn off the fire hydrants while the firemen at battling the blaze. They are dangerous fanatics!

And... here is Robert Reich's take on the problem (from his blog):
Consumer spending is 70 percent of the American economy, so if consumers can’t or won’t spend we’re back in the soup. Yet the government just reported that consumer spending stalled in April – the first month consumers didn’t up their spending since last September. Instead, consumers boosted their savings, probably because they’re worried about the slow pace of job growth (next Friday’s report will likely show gains, but the number will continue to be tiny compared to the overall ranks of the jobless), as well as a lackluster “recovery.” They’re also still carrying enormous debt burdens. One in four home owners is still underwater. And median wages are going nowhere.

So what’s Congress doing to stoke the economy as consumers pull back? In a word, nothing. Democratic House leaders yesterday shrank their jobs bill to a droplet. They jettisoned proposed subsidies to help the unemployed buy health insurance, as well as higher matching funds for state-run health programs such as Medicaid. And they trimmed extended unemployment insurance.


Deficit-cutting fever has also struck the Senate – except when it comes to the military, of course. Last night the Senate okayed a $60 billion war-funding bill for Afghanistan. So far this year, the Afghan war has cost more than the war in Iraq, in part because the infrastructure in Afghanistan is so much more primitive than in Iraq that our tax dollars are needed to build it so troops and tanks can move more easily over the terrain. But spending on road-building in Afghanistan does little to boost the American economy.

Meanwhile, state and local governments continue to slash and burn. They’re laying off even more teachers, fire fighters, social workers, and police; cancelling more programs for the poor and working class; and raising sales taxes. The fiscal drag from all of this will be around $150 billion in 2010.

Without consumers opening their wallets, and without government making up the difference, we’re careening toward a double-dip recession. The long-term deficit (i.e. Medicare as boomers become seniors) needs attention, but right now it’s critical for government to spend. Otherwise we have no hope of getting free of the gravitational pull of this recession.

The Monster that Swallowed Ottawa

Yep... a real horror story. Canada is under threat. And here is the documented story...

This is a great little video calling citizens to arms!

The Way Things Work: fMRI

Here is a bit from an excellent short discussion of how fMRI works from a post on the Neuroskeptic blog site:
So blood oxygen is a proxy for activation. How do you measure it? Oxygen in blood binds to haemoglobin, a protein that contains iron (which is why blood is red, like rust, and tastes iron). By a nice coincidence, haemoglobin with oxygen is red; haemoglobin without oxygen is blueish or purple. This is why your veins, containing deoxygenated blood, are blue and why you turn blue if you're suffocating.

You could measure neural activity by literally looking to see how red the brain is. This is actually possible, but obviously it's a bit impractical. Luckily, as well as being blue, deoxygenated haemoglobin acts as a magnet. So blood is magnetic, and the strength of its magnetic field depends on how oxygenated it is. That's really useful, but how do you measure those magnetic fields?

Using an extremely strong magnet - like the liquid-helium-cooled superconducting coil at the heart of every MRI scanner, for example - you can make some of the protons in the body align in a special way. If you then fire some radio waves at these aligned protons, they can absorb them ("resonate"). As soon as you stop the radio waves, they'll release them back at you, like an echo - which is why the most common form of fMRI scan is called Echo-Planar Imaging (EPI). All matter contains protons; in the human body, most of them are found in water.

Each proton only responds to a specific frequency of radio waves. This frequency is determined by the strength of the magnetic field in which it sits - stronger fields, higher frequencies. Crucially, the magnetic fields surrounding deoxygenated blood therefore shift the radio frequency at which nearby protons respond. Suppose a certain bit of the brain resonates at frequency X. If some deoxygenated blood appears nearby, it will stop them from responding to that frequency - by making them respond to a different one.

fMRI is essentially a way of measuring the degree to which protons in each part of the brain don't respond at the "expected" resonant frequency X, due to interference from nearby deoxygenated haemoglobin.
I chopped out the key bit, but the real story is more complicated, so go read the original post. It has nice illustrations too.

I'm impressed with the Neuroskeptic's blog. It looks quite good. It is narrow in breadth but deep in content. That's the complete reverse of my world view, but I love to use things like this for source material.

Oddities of Nature

I ran across a story about the Eyjafjallajokull Volcano blowing a smoke ring on the Watts Up With That blog. Go there to see some still photos and discussion.

That article had the following video of a smoke ring blown by the Mt. Etna volcano:

The article has some other example of smoke rings and a bubble ring.

Friday, May 28, 2010

Common Sense and Reasoning

Common sense and reasoning are rare commodities in the world of "big media". Maybe that is a reason why people are spending less time "getting news" from big media.

Here is an excellent post by Robert X. Cringely in is blog I, Cringely:
I want to make a point here, but I need to make it carefully, gently, so as not to rile people up. I’m not here to start a fight, folks, but it seems to me not nearly as many workers are throwing themselves off the roof of that Foxconn factory in China as I would expect.

Foxconn is the largest contract manufacturer in China and the world, making products notably for Apple and for other American companies, too. The company has been in the news lately because of very public worker suicides by jumping from the factory roof.

Were these people worked to death? Were they worked insane? In one case was the suicide the result of a suspected leak of Apple intellectual property? What kind of sweat shop is Foxconn, anyway?

I don’t know and nether do you. What we do know is the annual suicide rate per 100,000 people in China is about 13.5, with slightly more women than men taking their own lives (the only major country where that is the case, by the way). That means the Foxconn factory, with 300,000 workers, ought to be experiencing almost 40 suicides per year, while the reported numbers are a lot less than that.

This story says more about the press than it does about Foxconn, because I’ve read about it for months and nobody else seems to have done the math, which isn’t hard to do. But doing the math makes the story weaker, so of course it isn’t mentioned.

Foxconn may be Hell for all I know, but it doesn’t appear to be killing people.
It is pathetic that reporters can take the time to do a little analysis to assess whether they have a "story" worth reporting. Also, it is really disturbing that reporters don't take the time to provide the necessary context to make a "story" meaningful.

The Ripple Effect from the BP Gulf Disaster

Obama has turned a short term disaster into a medium term disaster. Here is a bit from Geoffrey Styles' blog Energy Outlook:
I suppose it was inevitable that we would arrive at the moment in the ongoing oil spill crisis at which the baby would be thrown out with the bath. That moment arrived at about 7 minutes into President Obama's press conference on the spill yesterday. After announcing the suspension of offshore drilling in Alaska, the cancellation of planned lease sales for the Gulf of Mexico and Virginia, and the extension for six months of his administration's moratorium on new drilling permits for deepwater wells, he ordered a halt to 33 exploration wells currently being drilled in the Gulf, excluding the two relief wells for the leaking Macondo prospect. Everything up until that point could be considered as reasonable, prudent, and expected responses by an administration faced with an unprecedented and still-unfolding environmental and economic disaster. But while stopping work on the 33 projects already underway might look like prudence to some, it could ultimately have economic consequences rivaling those of the spill.

The President's order is based on the recommendations of the 30-day investigation of offshore drilling carried out at his request by the Department of Interior. The report recommended a number of new standards for equipment and procedures for use in deepwater drilling, and it follows that it will require some time to implement all of these changes, both on the part of the drilling industry and in the government agencies charged with regulating and inspecting these activities. Absent from this report and from the President's order is any path for companies with rigs already drilling wells in deep water to quickly demonstrate that they are already sufficiently in compliance with these recommendations--which I must add have been issued without the final results of the various investigations into the actual causes of the accident, and thus must make significant assumptions concerning the relative importance of equipment failure, procedures, and human error.

I understand that the President has an obligation to protect the residents, businesses and environment of the Gulf Coast region from further harm. Another blowout or leak could turn disaster into total catastrophe. Yet the safe drilling record of the other firms operating in the Gulf does not give us any reason to expect that allowing the projects in question to continue would constitute such an unwarranted risk. It's also worth recalling that all of the drilling projects now required to suspend operations have already passed the emergency inspections the President ordered in the immediate aftermath of the Deepwater Horizon explosion and sinking. These inspections were completed on May 9.

What does this order mean on a practical level? A number of companies that paid for leases conveying the right to explore for and develop hydrocarbons in the Outer Continental Shelf, and that subsequently invested significant effort and expense in planning and obtaining permits for the exploration of these leases--instead of other leases offshore Angola, Brazil, or elsewhere--and that signed contracts with drill-ship operators and many other suppliers must now abrogate those contracts, declare force majeure, or pay off their suppliers and abandon these wells as if they were all dry holes. It is simply not realistic to imagine that any of these companies can afford to leave these rigs and crews in place for six months, waiting for the government to either show them a way forward or deliver another moratorium extension. Instead, the companies will scramble to redeploy this equipment and some of these workers to projects outside US waters, while arguing urgently with the government--and probably in court--that they should either be allowed to complete these projects or awarded substantial damages.


We should take some consolation that the President didn't shut down the 591 deepwater wells that are already producing oil and gas in the Gulf. The mere fact that this was reported suggests it had probably been under serious consideration. As I've noted on numersous occasions in the last several weeks, the oil and gas we produce from the Outer Continental Shelf is a crucial source of domestic energy and vital to our energy security. However, that importance also extends to our offshore drilling capacity, which was put at risk by this decision.
The more I watch Obama the more disappointed I become. In this disaster he was too much like Bush in Katrina, i.e. slow to react. Now he has over-reacted.

I thought that the US in the midst of the economic catastrophe bequeathed by George Bush -- the financial crisis of 2008 -- that the American voters had shown wisdom and elected one of those rare historical figures: the right guy at the right time. But I've now had 15 months to be disenchanted, and I am. Obama is a smart guy, but he keeps making mistakes. He is supposed to be a "quick learner" but I'm not seeing evidence of that. I'm seeing a guy who is cool and smart, but without real empathy, and without deep commitment. I don't see a patriot stepping up to the plate to change the game and set a new direction for America. Now that's a tragedy much bigger than the Gulf oil spill.

Learning a Lesson after Nine Years of Trying

Here is a report from our "hope springs eternal file"...

The US military has apparantly learned a valuable lesson in Afghanistan after fighting Taleban and Al Qaeda forces for nine years (from an AP newswire story):
The U.S. military's workhorse rifle - used in battle for the last 40 years - is proving less effective in Afghanistan against the Taliban's more primitive but longer range weapons.

As a result, the U.S. is reevaluating the performance of its standard M-4 rifle and considering a switch to weapons that fire a larger round largely discarded in the 1960s.

The M-4 is an updated version of the M-16, which was designed for close quarters combat in Vietnam. It worked well in Iraq, where much of the fighting was in cities such as Baghdad, Ramadi and Fallujah.

But a U.S. Army study found that the 5.56 mm bullets fired from M-4s don't retain enough velocity at distances greater than 1,000 feet (300 meters) to kill an adversary. In hilly regions of Afghanistan, NATO and insurgent forces are often 2,000 to 2,500 feet (600-800 meters) apart.

Afghans have a tradition of long-range ambushes against foreign forces. During the 1832-1842 British-Afghan war, the British found that their Brown Bess muskets could not reach insurgent sharpshooters firing higher-caliber Jezzail flintlocks.

Soviet soldiers in the 1980s found that their AK-47 rifles could not match the World War II-era bolt-action Lee-Enfield and Mauser rifles used by mujahedeen rebels.

"These are important considerations in Afghanistan, where NATO forces are frequently attacked by insurgents using ... sharpshooter's rifles, which are all chambered for a full-powered cartridge which dates back to the 1890s," said Paul Cornish, curator of firearms at the Imperial War Museum in London.
I'm sure your heart is warmed as mine is to find that the US military is a "learning organization", always open to new experiences, and quickly adapting to the situation it finds itself in. For the cynics among you who think nine years is just too long a period to learn this life-and-death experience, take heart! The good news is that the matter has now been brought to the attention of military headquarters and we can expect that within a decade or two a requisition order will be sent out, and -- judging from the experience in fitting troops in the Iraq theatre -- it will only be 4 or 5 years after that when the new arms will be flowing to the troops.

For those who think that 20 or 30 years for the new arms to arrive will be far too late. Don't worry! I can assure you that the American mission in Afghanistan will still be there and the military planners at that point will be busy downsizing the commitment from 500,000 troops to a more modest 400,000 troops.

Remember: good things take time. Haste makes waste!

Got Milk?

This is a video that the dairy industry doesn't want shown.

This is not normal for dairy farms. Here's a bit from the GreenMuze site that provides some background:
A recently released undercover video of sadistic abuse at the Conklin Dairy Farms Inc. in Plain City, Ohio is generating colossal shock waves in the media and farming communities across North America. The undercover video, filmed by Mercy For Animals during roughly a one month period in late April to May, 2010, shows diary farm workers beating cows with crowbars, punching calves in the face, stabbing animals with pitchforks, holding down newborn calves and stomping on their heads. The video is extremely graphic and goes far beyond rough handling into sadistic criminal violence against animals.

One Conklin Dairy Farms Inc. worker identified in the video, Billy Joe Gregg Jr., was quickly fired from the dairy and has been charged with 12 counts of cruelty. The Conklin Dairy Farms released a statement that explained “We will not condone animal abuse on our farm. We have launched our own internal investigation into this matter and will be conducting interviews with everyone on our farm who works with our animals."
This site wants to milk (pun intended) this video for dollars and sell you their "vegan" philosophy. I'm glad that they made this video public, but Their use this to paint the whole industry as cruel is reprehensible. Maybe not as vicious as the dairy farmer, but along the same line of self-serving "morality".

Thursday, May 27, 2010

Scott Adams gets a Nerdgasm

This is just too funny. This is a post by Scott Adams of Dilbert fame on his blog commenting tongue in cheek on BP and the Gulf oil spill. He's funny, but he is making a serious point about over-estimating "doomsday".
Betting on the Engineers

I'm fascinated by BP's attempts to stop the oil leak, especially today with the Top Kill operation underway. I've had multiple nerdgasms following the story. I mean, seriously, I'm sitting in my home office in California and watching an oil leak a mile below the surface, on a live submarine cam, as scientists try to save the Gulf from destruction. You know this will someday be a movie, and I'll watch it again.

As I mentioned in an earlier blog, I bought some BP stock recently because I liked the odds that the top engineers and scientists in the solar system, with unlimited funding, presumably somewhat freed from management meddling, could plug a hole. And yes, I averaged down.

I also assumed that the liberal media's coverage of the oil damage would depress the stock more than necessary. It's a catastrophe, no doubt, but even catastrophes have levels. I'm betting the financial damage will be very, very, very bad and not very, very, very, very bad.

This is also a test of my theory that you should buy stocks in the companies that you hate the most. In general, you hate the companies that have the most power. And BP is the frickin' Death Star of companies. They're in the process of destroying an entire region of the world and there's still no talk of cutting their next dividend. I admire them in the same way I admire the work ethic of serial killers. There's an undeniable awesomeness about BP. I hate BP, but I still want to have their baby.
He is certainly winning on his bet today. BP is up nearly 7% today on news that the well's leak is plugged.

Wednesday, May 26, 2010

US Recovery

I happen to believe that the US economy is now 8 months into a recovery and slowly building steam.

However, if you want to be pessimistic, here are 25 questions posed by Michael Snyder on Black Listed News to convince you that the US is falling apart:
So the following are 25 questions to ask anyone who is delusional enough to believe that this economic recovery is real….

#1) In what universe is an economy with 39.68 million Americans on food stamps considered to be a healthy, recovering economy? In fact, the U.S. Department of Agriculture forecasts that enrollment in the food stamp program will exceed 43 million Americans in 2011. Is a rapidly increasing number of Americans on food stamps a good sign or a bad sign for the economy?

#2) According to RealtyTrac, foreclosure filings were reported on 367,056 properties in the month of March. This was an increase of almost 19 percent from February, and it was the highest monthly total since RealtyTrac began issuing its report back in January 2005. So can you please explain again how the U.S. real estate market is getting better?

#3) The Mortgage Bankers Association just announced that more than 10 percent of U.S. homeowners with a mortgage had missed at least one payment in the January-March period. That was a record high and up from 9.1 percent a year ago. Do you think that is an indication that the U.S. housing market is recovering?

#4) How can the U.S. real estate market be considered healthy when, for the first time in modern history, banks own a greater share of residential housing net worth in the United States than all individual Americans put together?

#5) With the U.S. Congress planning to quadruple oil taxes, what do you think that is going to do to the price of gasoline in the United States and how do you think that will affect the U.S. economy?

#6) Do you think that it is a good sign that Arnold Schwarzenegger, the governor of the state of California, says that “terrible cuts” are urgently needed in order to avoid a complete financial disaster in his state?

#7) But it just isn’t California that is in trouble. Dozens of U.S. states are in such bad financial shape that they are getting ready for their biggest budget cuts in decades. What do you think all of those budget cuts will do to the economy?

#8) In March, the U.S. trade deficit widened to its highest level since December 2008. Month after month after month we buy much more from the rest of the world than they buy from us. Wealth is draining out of the United States at an unprecedented rate. So is the fact that the gigantic U.S. trade deficit is actually getting bigger a good sign or a bad sign for the U.S. economy?

#9) Considering the fact that the U.S. government is projected to have a 1.6 trillion dollar deficit in 2010, and considering the fact that if you went out and spent one dollar every single second it would take you more than 31,000 years to spend a trillion dollars, how can anyone in their right mind claim that the U.S. economy is getting healthier when we are getting into so much debt?

#10) The U.S. Treasury Department recently announced that the U.S. government suffered a wider-than-expected budget deficit of 82.69 billion dollars in April. So is the fact that the red ink of the U.S. government is actually worse than projected a good sign or a bad sign?

#11) According to one new report, the U.S. national debt will reach 100 percent of GDP by the year 2015. So is that a sign of economic recovery or of economic disaster?

#12) Monstrous amounts of oil continue to gush freely into the Gulf of Mexico, and analysts are already projecting that the seafood and tourism industries along the Gulf coast will be devastated for decades by this unprecedented environmental disaster. In light of those facts, how in the world can anyone project that the U.S. economy will soon be stronger than ever?

#13) The FDIC’s list of problem banks recently hit a 17-year high. Do you think that an increasing number of small banks failing is a good sign or a bad sign for the U.S. economy?

#14) The FDIC is backing 8,000 banks that have a total of $13 trillion in assets with a deposit insurance fund that is basically flat broke. So what do you think will happen if a significant number of small banks do start failing?

#15) Existing home sales in the United States jumped 7.6 percent in April. That is the good news. The bad news is that this increase only happened because the deadline to take advantage of the temporary home buyer tax credit (government bribe) was looming. So now that there is no more tax credit for home buyers, what will that do to home sales?

#16) Both Fannie Mae and Freddie Mac recently told the U.S. government that they are going to need even more bailout money. So what does it say about the U.S. economy when the two “pillars” of the U.S. mortgage industry are government-backed financial black holes that the U.S. government has to relentlessly pour money into?

#17) 43 percent of Americans have less than $10,000 saved for retirement. Tens of millions of Americans find themselves just one lawsuit, one really bad traffic accident or one very serious illness away from financial ruin. With so many Americans living on the edge, how can you say that the economy is healthy?

#18) The mayor of Detroit says that the real unemployment rate in his city is somewhere around 50 percent. So can the U.S. really be experiencing an economic recovery when so many are still unemployed in one of America’s biggest cities?

#19) Gallup’s measure of underemployment hit 20.0% on March 15th. That was up from 19.7% two weeks earlier and 19.5% at the start of the year. Do you think that is a good trend or a bad trend?

#20) One new poll shows that 76 percent of Americans believe that the U.S. economy is still in a recession. So are the vast majority of Americans just stupid or could we still actually be in a recession?

#21) The bottom 40 percent of those living in the United States now collectively own less than 1 percent of the nation’s wealth. So is Barack Obama’s mantra that “what is good for Wall Street is good for Main Street” actually true?

#22) Richard Russell, the famous author of the Dow Theory Letters, says that Americans should sell anything they can sell in order to get liquid because of the economic trouble that is coming. Do you think that Richard Russell is delusional or could he possibly have a point?

#23) Defaults on apartment building mortgages held by U.S. banks climbed to a record 4.6 percent in the first quarter of 2010. In fact, that was almost twice the level of a year earlier. Does that look like a good trend to you?

#24) In March, the price of fresh and dried vegetables in the United States soared 49.3% - the most in 16 years. Is it a sign of a healthy economy when food prices are increasing so dramatically?

#25) 1.41 million Americans filed for personal bankruptcy in 2009 – a 32 percent increase over 2008. Not only that, more Americans filed for bankruptcy in March 2010 than during any month since U.S. bankruptcy law was tightened in October 2005. So shouldn’t we at least wait until the number of Americans filing for bankruptcy is not setting new all-time records before we even dare whisper the words “economic recovery”?
Go to the orginal article to get the links to supporting material.

Krugman's Growing Pessimism

The only economist that I trust, Paul Krugman, is growing more despairing that policy makers will get off their duffs and do the right thing. They are falling into the old shibboleths, the same ones that made the Great Depression drag on for more than a decade (and kept Japan in a Great Recession for two decades).

Here is the posting from his NY Times blog:
Reasons To Despair

For some reason today’s papers made me feel especially grim about the prospects for economic recovery — not the economic news so much as what one sees about the mindset of policy makers.

Here’s where we are: growing GDP, but mass unemployment still the law of the land, with only tiny progress so far. What can be done?

Well, we could have more fiscal stimulus — but Congress is balking even at the idea of extending aid for the ever-growing ranks of the long-term unemployed. Fiscal responsibility, you see — hey, and let’s make sure estate taxes stay low!

We could get tough with China, which continues its currency manipulation and, in the face of a world of grossly inadequate demand, is actually tightening monetary policy to avoid an overheating economy — when basic textbook economics says that it should be appreciating its currency instead, which would not only rebalance China’s economy but help the rest of the world. So given China’s outrageous behavior, Geithner went to China, got nothing .. and pronounced himself very pleased.

We could do more through monetary policy. Macro theory suggests that the theoretically right answer, if you can do it, is to get central banks to commit to a higher inflation target. But the Fed and the Bank of Japan say no, because … well, that’s not what central bankers do.

It’s depressing: shibboleths and conventional wisdom are blocking all routes out of this slump. And I worry that policy makers will just sit there, for years and years, all the while congratulating themselves on the soundness of their policies.
I remain optimistic, but I'm probably a fool whistling by the graveyard. Krugman has the knowledge and the data to make judgements I can't fool myself into believing I can honesty make. So this is indeed bad news.

Genetics, Ethics, and Self Discovery

Here is an interesting posting by Ursula Goodenough on the NPR 13.7 blog:
In one of his lectures, Stephen J. Gould wondered aloud what it would be like if the Australopithicus genus and the other Homo species had not gone extinct and were instead still with us today. He didn’t offer an answer. He just noted, and I agree, that it was an interesting question to think about.

Two news items in the past few weeks converge on Gould’s question. The first is the announcement from Craig Venter’s biotech company that they have artificially synthesized a functional bacterial chromosome. The second is the announcement here and here from Svante Pääbo’s lab that they have produced a first draft of the Homo neanderthalensis (Neanderthal) genome sequence based on DNA fragments extracted from fossil bones.

Hence it is now formally feasible, albeit not yet remotely practicable, to synthesize artificial Neanderthal chromosomes, insert copies into enucleated human eggs, and recruit volunteers to give birth to a Homo species that has been extinct for 30,000 years.

Now to put this scenario in perspective, let’s imagine a different proposal. Scientists have obtained DNA from recovered bones of the dodo, (Raphus cucullatus), a bird that has been extinct since the mid-17th century. Hence it is also formally feasible to sequence the dodo genome, insert artificial copies into enucleated pigeon eggs, and hatch out bona fide Rapus cucullatus.

My hunch is that readers might have a vague “that’d-be-kinda-cool” response to the dodo experiment, but that responses to the Neanderthal experiment would be pretty intense. So what’s the difference? Well, obviously, the difference is that the Neanderthals are our sister species, so ethical issues arise. I’ll return to that shortly.

Meanwhile, here’s the real mind-blower from the Pääbo lab’s report: They estimate that most human genomes contain 1-4% Neanderthal-derived DNA sequences. This could only be the case if H. sapiens and H. neanderthalenis had interbred, which apparently occurred, minimally, during two independent historical periods, one ~60,000 years ago in the eastern Mediterranean and the other ~45,000 years ago in east Asia.

The Neanderthal sequences are detected in present-day persons of European and Asian descent but not in present-day persons of African descent, which is not surprising given the fossil record: H.sapiens and H. neanderthalensis lived in overlapping regions of Europe and the Middle East for many thousands of years, whereas Neanderthal remains have yet to be found in Africa.
Taking this last paragraph, Goodenough makes the obvious conclusion:
It perhaps goes without saying that there’ a piquant irony here. 1) Non-African cultures have a shameful history of considering persons of African origin to be “savages.” 2) The term “neanderthal” is used to denote a brutish savage. And now we learn…
This is funny. And, this is an excellent antidote to those who want to classify others, especially on insufficient knowledge. Racism is a prejudice for this very reason.

I for one would like to see as many species "resurrected" as possible. I think we can solve the moral & ethical issues as needed.

Tuesday, May 25, 2010

Banks Corrupting Congress

Here's a bit from a post by Robert Reich on his blog:
At a time when California’s Republican gubernatorial candidate Meg Whitman is losing ground to her Republican rival in the primary because of her ties to Wall Street, when Utah’s incumbent Senator Robert Bennett was just booted out by Republicans who are furious that he voted to bailout Wall Street, when New Jersey’s Jon Corzine lost his bid for reelection partly because of he was formerly head of Goldman Sachs, when Connecticut’s Chris Dodd was so tarnished by his close ties to Wall Street that polls showed he had little chance of reelection — at a time, in other words, when Wall Street is political poison, why are politicians still so intent on doing its bidding?

Answer: Wall Street’s almost endless supply of money for upcoming campaigns.
Wall Street is fighting on many levels to corrupt the government "of the people, by the people, for the people". Their political contributions let them front candidates. If the people reject these corrupt puppets of Wall Street, then Wall Street buys the votes of sitting members of Congress. And if Congress is able to pass something contrary to Wall Street's will, they buy the President to veto it. And, I suspect, if the President signs it into law, they buy lawyers and judges to get court decisions to quash the law. Wall Street plays with a "defense in depth".

And as Reich points out in another post:
The most important thing to know about the 1,500 page financial reform bill passed by the Senate last week — now on he way to being reconciled with the House bill — is that it’s regulatory. It does nothing to change the structure of Wall Street.

The bill omits two critical ideas for changing the structure of Wall Street’s biggest banks so they won’t cause more trouble in the future, and leaves a third idea in limbo. The White House doesn’t support any of them.

First, although the Senate bill seeks to avoid the “too big to fail” problem by pushing failing banks into an “orderly” bankruptcy-type process, this regulatory approach isn’t enough. The Senate roundly rejected an amendment that would have broken up the biggest banks by imposing caps on the deposits they could hold and their capital assets.


Another crucial provision left out of the Senate bill would be to change the structure of banking by resurrecting the Depression-era Glass-Steagall Act and force banks to separate commercial banking (the classic function of connecting lenders to borrowers) from investment banking.


Which brings us to the third structural idea, advanced by Senator Blanche Lincoln. She would force the banks to do their derivative trades in entities separate from their commercial banking.

This measure is still in the bill, but is on life-support after Paul Volcker, Tim Geithner, and Fed chair Ben Bernanke came out against it. Republicans hate it. The biggest banks detest it. Virtually every major Wall Street and business lobbyist has its guns trained on it. Almost no one in Washington believes it will survive the upcoming conference committee.


The interesting question is why the president, who says he wants to get “tough” on banks, has also turned his back on changing the structure of American banks — opting for a regulatory approach instead.

It’s almost exactly like health care reform. Ideas for changing the structure of the health-care industry — a single payer, Medicare for all, even a so-called “public option” — were all jettisoned by the White House in favor of a complex set of regulations that left the old system of private for-profit health insurers in place. The final health care act doesn’t even remove the exemption of private insurers from the nation’s antitrust laws.

Regulations don’t work if the underlying structure of an industry — be it banking or health care — got us into trouble in the first place. Wall Street’s big banks are just too big, and their ability to draw on commercial deposits for investment banking activities, including derivatives, will make them even bigger. It will also subject the economy to greater and greater risks in the future. No amount of regulation can cure that.

Similarly, the underlying system of private for-profit health insurance is a key driver of America’s bloated and ineffective health care delivery. We can try to regulate it like mad, but no amount of regulation will cure this fundamental problem.

A regulatory rather than structural approach to deep-seated problems in complex industries like banking and health care is also vulnerable to the inevitable erosion that occurs when industry lobbyists insert themselves into the regulatory process. Tiny loopholes get larger. Delays get longer. Legislative words are warped and distorted to mean what industry wants them to mean.


The only way to have a lasting effect on industries as large and intransigent as banking and health care is to alter their structure. That was the approach taken to finance by Franklin D. Roosevelt in the 1930s, and by Lyndon Johnson to health care (Medicare) in the 1960s.

So why has Obama consistently chosen regulation over restructuring? Because restructuring Wall Street or health care would surely elicit firestorms from these industries. Both are politically powerful, and Obama did not want to take them on directly.

A regulatory approach allows for more bargaining, not only in the legislative process but also, over time, in the rule-making process as legislation is put into effect. It’s always possible to placate an industry with a carefully-chosen loophole or vague legislative language that will allow the industry to continue to go on much as before.

And that’s precisely the problem.
There is a fatal flaw in Obama's character. He sold himself as an agent of change, but he keeps delivering watered down compromises that are half fixes that can easily be tampered with and undone. He provides the illusion of change but not the substance.

Crimes in High Places

The Obama administration is treating the Gulf oil spill like a minor annoyance that requires bit of leftover attention while Obama attends to "more important" matters. Shades of Bush flying over New Orleans after Katrina and taking way too long to show up and declare any concern for the city.

Here is a bit from a NY Times article by Maureen Dowd on the criminal negligence by federal regulatory agencies:
In a report released on Tuesday, Mary Kendall, acting inspector general of the Department of the Interior, described an agency that followed Cheney’s lead in letting the oil industry write the rules.

Just like those S.E.C. employees who were watching porn and ignoring warning signs while Wall Street punks created financial Frankensteins, some M.M.S. employees were watching porn, using coke and crystal meth and accepting gifts like trips to the Peach Bowl game from oil and gas companies, the report said.

Regarding outrageous behavior prior to 2007, one confidential source told investigators that some M.M.S. inspectors let oil and gas company staffers fill out inspection forms using pencils “and MMS inspectors would write on top of the pencil in ink and turn in the completed form.”


The tragedy is that M.M.S. eerily presaged the disaster in the draft of a May 2000 environmental analysis of deep-water drilling in the gulf. The agency noted that “the oil industry’s experience base in deepwater well control is limited” and that given the prodigious production rates, “a deepwater blowout of this magnitude in the U.S. Gulf of Mexico could easily turn out to be a potential showstopper” for the Outer Continental Shelf program.

But M.M.S. got rid of those caveats in the final report, just as they deemed a remote-controlled shut-off switch an unnecessary expense for drilling companies several years ago.
Obama has walled himself off from public opinion. He is impervious to comments about his failure to act and his ridiculous attempts to find "common ground" with political enemies that have no interest in compromise. He campaigned as the man with the answers with his slogan "Change we can believe in" but he has delivered indifference and incompetence (not nearly as incompetent as Bush, but there is an urgent need for leadership and competence in the US and Obama is not filling that need).

Hysteria and Fanaticism

For those old enough to remember, back in the 1980s talk show hosts, like Oprah, milked the concern over "crack babies" for all it was worth. The host would bring in "experts" who would pain pictures of the bleak future for infants who had suffered at the hands of the addict mothers.

Well... twenty some years later and the truth comes out. Some harm was done, but nothing like the doomsday scenario drawn by the fanatics. (Can we draw a lesson here from contemporary doomsday promoters, e.g. "global warming"?)

Here is a bit from the Mind Hacks blog by Vaughan Bell:
I've just noticed a smattering of articles that have tackled the idea of the 'crack baby' which became popular during the worrying emergence of crack cocaine during the late 80s. It turns out that babies exposed to crack in the womb weren't necessarily massively brain damaged tragedies as the stereotype had it, but the concept has remained with us.

This is despite the fact that we have solid research to show that while those exposed to cocaine in utero do show some differences from other kids, the effects are undesirable but actually relatively small.

This is from The New York Times last year:

Cocaine slows fetal growth, and exposed infants tend to be born smaller than unexposed ones, with smaller heads. But as these children grow, brain and body size catch up.

At a scientific conference in November, Dr. Lester presented an analysis of a pool of studies of 14 groups of cocaine-exposed children — 4,419 in all, ranging in age from 4 to 13. The analysis failed to show a statistically significant effect on I.Q. or language development. In the largest of the studies, I.Q. scores of exposed children averaged about 4 points lower at age 7 than those of unexposed children.

In tests that measure specific brain functions, there is evidence that cocaine-exposed children are more likely than others to have difficulty with tasks that require visual attention and “executive function” — the brain’s ability to set priorities and pay selective attention, enabling the child to focus on the task at hand.

Cocaine exposure may also increase the frequency of defiant behavior and poor conduct, according to Dr. Lester’s analysis. There is also some evidence that boys may be more vulnerable than girls to behavior problems.

But experts say these findings are quite subtle and hard to generalize. “Just because it is statistically significant doesn’t mean that it is a huge public health impact,” said Dr. Harolyn M. Belcher, a neurodevelopmental pediatrician who is director of research at the Kennedy Krieger Institute’s Family Center in Baltimore.
A piece from City Limits Monthly tracked how the myth arose. It's probably the best account I've read of the cultural currents that promoted the concept to front page news and keep it afloat even today.
Go to the original article to get the embedded links.

I think the lesson to take from this is to be wary of media manipulation. People "selling" a story are not the generous, uninterested bystanders they claim to be. In this case, talk show hosts milked this story of ratings. They really didn't care if the story was true or false. They only cared that it was a "gripping drama" that would get viewers.

Beware of manipulation!

People Believing Lies

People are gullible. They are especially gullible for some lie that confirms their suspicions. Here is a bit from a posting by Romeo Vitelli, a Canadian psychologist, on his blog Providentia. Here he takes on the history of subliminal advertising, exposes its fakery, but points out that the truth coming out 48 years ago, some people still believe in the "power" of subliminal advertising:
Conspiracy theorists accused governments and corporations of manipulating popular opinion through "brainwashing". The National Association of Broadcasters formally banned subliminal advertising in 1958 and all American television networks quickly followed suit. Legislation banning subliminal advertising was later passed in the U.K. and Australia and civil rights groups pounced on all suspected uses of subliminal messages in ads (real or imagined).

On the other hand, researchers who tried to replicate Vicary's research weren't getting the same results. Vicary had been extremely ambiguous about the actual methodology that he used made which true replication of his method impossible. It also didn't help that operational definitions of what could be considered "subliminal stimuli" varied widely . In an attempt at replicating his own results, Vicary carried out a 1958 study using a Canadian television broadcast in which the words "Telephone now" were flashed 352 times during a half-hour show. There was no noticeable increase in telephone use during or after the broadcast (although the Canadian Broadcasting Corporation did get thousands of letters from viewers guessing at the nature of the subliminal message, nobody got the right answer). Other research studies were just as inconclusive. Vicary's Subliminal Projection Company quickly went out of business and he returned to being a media researcher for Dunn and Bradstreet. In a 1962 interview, Vicary admitted that the news conference and his research findings had been nothing more than a "gimmick". As he ruefully added in the interview, "All I accomplished, I guess,...was to put a new word into common usage. And for a man who makes a career out of picking the right names for products and companies, I should have my head examined for using a word like subliminal".

Despite Vicary's confession, the supposed dangers of subliminal advertising still lurk in the popular imagination and has taken on the status of an urban legend. While there is no actual evidence that subliminal messaging works, anecdotes about its supposed effectiveness abound. Not only are "subliminal" self-help tapes still being sold, but opinion surveys have shown that belief in subliminal advertising is widespread. This belief is especially apparent in allegations of "backward masking" of satanic messages in rock music, a claim that is still a common staple in conservative circles. A 1990 trial in Reno, Nevada was held in which the parents of two teenagers blamed their suicides on subliminal messaging in a Judas Priest album. The parents lost the case but the resulting publicity added to the "anecdotal evidence" of subliminal advertising's widespread use.

Meanwhile, laws against subliminal advertising remains on the books in many countries and research still continues (albeit without conclusive results). Despite the lack of success, the subliminal tape industry continues to do good business as well. Such is the power of advertising.

Suppressing the Truth

All true believers know that "organic" is better for you, so they naturally have no interest in any research which might show an opposite conclusion. But Luboš Motl has a posting on his blog, The Reference Frame, showing an "unexpected" result:
A new article written by Ailsa J McKenzie and Mark J Whittingham of Newcastle was just published in Journal of the Science of Food and Agriculture:
Birds select conventional over organic wheat when given free choice
During the recent three years, the authors have repeated the same experiment many times, in different locations (Nature vs lab), different arrangement, permutations of the wheat types, and with different species.

But the conclusion was universal: after some time that the birds needed to learn the strategy, the birds would significantly more often select the conventional wheat - treated by various synthetic and chemical products during its production - instead of organic food - where the synthetic compounds are completely avoided.

It's very likely that the birds try to maximize the protein content and after some time, they just learn how to do so and what is good for them. Fertilization adds about 10% to the protein content.

The research indicates that the birds act much more rationally than many people - and whole governments - that routinely select the food that is nutritionally inferior as well as more expensive. My sources point out that if the result of the research were the opposite one, we would read thousands of articles claiming that the birds reject chemistry.

But because the conclusion of the research is the inconvenient one, you won't read about this paper almost anywhere.

Things Obama Should Have Done

The list of things that Obama should have done and didn't keeps getting longer. I'm really disappointed by this guy who ran on the slogan of "Change you can believe in". The over-promised and is busy under-delivering.

Here's a bit from a post by Geoffrey Styles on his Energy Outlook blog. He points out that the stimulus bill should have built pipeline infrastructure to move houses in the Northeast from fuel oil to natural gas. The gas cost almost half what the fuel oil does to heat the same house. This kind of infrastructure would would have created many, many jobs and resulted in savings of millions of Americans:
Consider heating oil, a close cousin of diesel fuel. Although natural gas has been eroding the market share of heating oil in residential and commercial applications for decades, US homes still burn on average around 320,000 bbl/day of heating oil, mainly in the northeast. Commercial and industrial users consume a somewhat smaller quantity. Together, this represents about 10% of total US distillate consumption of around 4 million bbl/day (at least when the economy is healthy), or around 2% of total US petroleum consumption. Every barrel of heating oil displaced by natural gas or other fuels, such as bio-heating oil, could fuel diesel cars and trucks--after being processed into ultra-low-sulfur diesel--or be exported to offset a portion of our other imports. Replacing all of the residential heating oil used in the US would free up enough fuel for around 12 million diesel cars like the Audi A3 TDI that I wrote about a couple of months ago. And with natural gas having gotten much cheaper relative to oil, thanks to the growth of unconventional gas supplies, the economic advantage of switching can be considerable, as illustrated in the graph below, comparing residential gas and heating oil prices in New York.

How practical is this substitution? Well, having lived in a part of the country in which many older homes used oil heat, the biggest obstacle for most homeowners is the cost of replacing the furnace and connecting the house to gas. And there are still regions for which the latter is either cost-prohibitive or simply out of the question, because the gas pipeline network hasn't reached every community and neighborhood. (In such cases, propane, which is increasingly sourced from natural gas, may be a good option.) In the long run, particularly with the discovery of vast natural gas reserves in the Marcellus Shale underlying much of the northeast, the gas will come, and so will the infrastructure. The question is whether that process could be speeded up with a little help, and whether it makes sense to do so.

An article I ran across recently suggested that the American Recovery and Reinvestment Act of 2009 (the stimulus) included standards and funding for converting oil heating systems to gas. When I reviewed the text, most of that support seemed to be channeled through existing state programs. Nor did I see anything promoting the expansion of the natural gas pipeline and reticulation network (i.e., "last mile"), which remains the crucial step in this process for many small towns and rural communities. A quick search of the current draft of the Kerry-Lieberman climate bill didn't reveal anything along these lines, either, despite the emissions advantage of heating with gas instead of oil. That looks like a glaring omission to me.

The $30 Billion Shorfcut

BP has a history of poor operations, making short-term decisions in favour of a quick profit. That has now blown up big time on them with the Gulf oil spill.

Here is an interesting article by David Hammer of the Times-Picayune newspaper that talks about the criminally foolish "shortcuts" taken by BP:
Costly, time-consuming test of cement linings in Deepwater Horizon rig was omitted, spokesman says

BP hired a top oilfield service company to test the strength of cement linings on the Deepwater Horizon's well, but sent the firm's workers home 11 hours before the rig exploded April 20 without performing a final check that a top cementing company executive called "the only test that can really determine the actual effectiveness" of the well's seal.

A spokesman for the testing firm, Schlumberger, said BP had a Schlumberger team and equipment for sending acoustic testing lines down the well "on standby" from April 18 to April 20. But BP never asked the Schlumberger crew to perform the acoustic test and sent its members back to Louisiana on a regularly scheduled helicopter flight at 11 a.m., Schlumberger spokesman Stephen T. Harris said.
Go read the whole article. It has an excellent graphic with details about the oil well.

The Truth is Out There

Sometimes you get more truth from fiction and humour than from the supposedly serious guardians of culture and media. You don't get much truth from the financial press and precious little from the government. So you need to turn to the comedians and the humour magazines to get the real picture.

The Onion has just published this tongue-in-cheek "revelation" about tough new financial regulations:
New Law Forces CEOs To Humbly Shrug Before Receiving Massive Bonuses

WASHINGTON—Securities and Exchange Commission officials are calling it the strictest regulatory reform since the Great Depression: CEOs of major financial institutions will now be required to humbly shrug and smile sheepishly before accepting huge salary bonuses.

The new regulation, SEC rule 206(b)-7, will reportedly target Wall Street executives who accept disgustingly bloated annual payouts, forcing them to raise and then lower their shoulders in a manner that conveys a mild degree of humility or a sense of "Aw, shucks. Who? Me?"

"This sweeping new reform sends a clear message to fat-cat CEOs at firms like Goldman Sachs and AIG," SEC chair Mary Schapiro said Monday. "Never again will they be able to receive massive bonuses unless, at a minimum, they flash a gee-I-don't-think-I-should expression and say something like 'Well, all right, but only if you insist' first."


Addressing reporters Monday, President Obama praised the SEC's rule change, but said the regulatory body must now set stronger limits on how bankers act after they receive their bonuses.

"Making them shrug is one thing," Obama said, "but stopping their shameful practice of pumping their fists, high-fiving everyone in the office, and shouting 'cha-ching' immediately afterward is quite another."
Go read the original article, it is a hoot.

Corruption at the Top

Here is a list put together by Zack Carter on of the 10 most corrupt capitalists in the US. The definition use is:
The financial crisis has unveiled a new set of public villains—corrupt corporate capitalists who leveraged their connections in government for their own personal profit. During the Clinton and Bush administrations, many of these schemers were worshiped as geniuses, heroes or icons of American progress. But today we know these opportunists for what they are: Deregulatory hacks hellbent on making a profit at any cost.
And the winners are...
1. Robert Rubin
2. Alan Greenspan
3. Larry Summers
4. Phil and Wendy Gramm
5. Jamie Dimon
6. Stephen Friedman
7. Robert Steel
8. Henry Paulson
9. Warren Buffett
10. Goldman Sachs: No company exemplifies the revolving door between Wall Street and Washington more than Goldman Sachs. The four people on this list are some of the worst offenders, but Goldman's D.C. army has includes many other top officials in this administration and the last...
-Joshua Bolton, chief of staff for George W. Bush, was a Goldman man
-Current New York Fed President William Dudley is a Goldman man
-Current Commodity Futures Trading Commission Chairman Gary Gensler has been a responsible regulator under Obama, but he was a deregulatory hawk during the Clinton years, and worked at Goldman for nearly two decades before that.
-A top aide to Timothy Geithner, Gene Sperling, is a Goldman man
-Current Treasury Undersecretary Robert Hormats is a Goldman man
-Current Treasury Chief of Staff Mark Patterson is a former Goldman lobbyist
-Former SEC Chairman Arthur Levitt is now a Goldman adviser
-Neel Kashkari, Henry Paulson’s deputy on TARP, was a Goldman man
-COO of the SEC Enforcement Division Adam Storch is a Goldman man
-Former Sen. John Corzine, D-N.J., was Goldman’s CEO before Henry Paulson
-Rep. Jim Himes, D-Conn., was a Goldman Vice President before he ran for Congress
-Former House Minority Leader Dick Gephardt, D-Mo., now lobbies for Goldman
For details, go read the article on

The Bush Legacy: Totaling the Costs of Sept 2008

Here is the conclusion of a study done by the Pew Charitable Trusts on the financial costs to ordinary Americans by the folly of the "deregulate, deregulate, deregulate" Republicans and the cronyism of the Bush administration:
U.S. households lost on average nearly $5,800 in income due to reduced economic growth during the acute stage of the financial crisis from September 2008 through the end of 2009.[1] Costs to the federal government due to its interventions to mitigate the financial crisis amounted to $2,050, on average, for each U.S. household. Also, the combined peak loss from declining stock and home values totaled nearly $100,000, on average per U.S. household, during the July 2008 to March 2009 period. This analysis highlights the importance of reducing the onset and severity of future financial crises, and the value of market reforms to achieve this goal.


Income – The financial crisis cost the U.S. an estimated $648 billion due to slower economic growth, as measured by the difference between the Congressional Budget Office (CBO) economic forecast made in September 2008 and the actual performance of the economy from September 2008 through the end of 2009. That equates to an average of approximately $5,800 in lost income for each U.S. household.

Government Response – Federal government spending to mitigate the financial crisis through the Troubled Asset Relief Program (TARP) will result in a net cost to taxpayers of $73 billion according to the CBO. This is approximately $2,050 per U.S. household on average.

Home Values – The U.S. lost $3.4 trillion in real estate wealth from July 2008 to March 2009 according to the Federal Reserve. This is roughly $30,300 per U.S. household. Further, 500,000 additional foreclosures began during the acute phase of the financial crisis than were expected, based on the September 2008 CBO forecast.

Stock Values – The U.S. lost $7.4 trillion in stock wealth from July 2008 to March 2009, according to the Federal Reserve. This is roughly $66,200 on average per U.S. household.

Jobs – 5.5 million more American jobs were lost due to slower economic growth during the financial crisis than what was predicted by the September 2008 CBO forecast.
Go read the whole report here.

It will take a generation to recover from the folly of right wing policies. The tragedy is that it appears that the US public is about to re-enable the right wing nuts with election victories in 2010. So this tragedy is not over. The misguided public is about to plunge itself once again into the corrupt hands of Republican politics that uses "family values" and right wing Christian issues as cover for their agenda to rape and pillage the economy for the benefit of the ultra-rich.

The European Debt Crisis

Here are the gory details explained in a nutshell...

Ponzi scheme anybody?

Seriously: this whole crisis is overblown. It will be sorted out. The amounts are manageable. What is needed is better regulation and a plan. Oops... I've just called for the two things that the economic nuts refuse to accept: regulation and planning. The fanatics assure us that everything goes so much better if it is done with no cops on the beat and no "big picture" to give anybody a clue as to what is really going on!

Monday, May 24, 2010

US Border Bullies

Here is a really sad story of Peter Watts who was brutalized by the US Border guards as he was leaving the US to return to Canada and out of the blue they stopped him and started ordering him around. He innocently got out of his car and asked "what's going on?" and they all hell broke out. The way the border guards work in the US is that you have no rights, you can't ask any questions, you can be brutalized, and the legal system backed up these brutal border guards to the hilt. It is a crime, but nobody in the US wants to hear the truth or do the right thing. Peter Watts has been bulldozed and brutalized and the US system smugly think it did the "right thing". This is sick.

For those who don't believe that the US can become a fascist state, need to listen the the interview and understand all the facts and ponder this. It is insane and it stands. This is what the US has become. It is a state that tortures innocent "terrorists" and that brutalizes Canadians as they innocently drive home. The country has gone insane.

Listen to this: it is a really ugly story.

This kind of ugly police brutality goes on all the time. Here's two recent cases in Canada:
  • Ian Bush - an 18 year old gets picked up for drinking outside a hockey arena, gets taken to the local police station, and dies from a bullet in the back of the brain... a "self-inflicted" wound if you believe the police.

  • Robert Dziekański - a Polish immigrant gets lost in the bowels of the airport waiting for his mother to pick him up. She is locked outside the "secure" area and tries to get authorities to help her get in contact with her son. The son is inside the "secure" area and only speaks Polish and doesn't understand that he needs to get outside the secure area. Nobody in the airport notices while he waits for 6 hours after a 12 hour flight. He goes stir crazy. Nobody helps. When he makes noises because he can't understand why his mother isn't there, the police come in a taser him multiple times while piled on and suffocate him. This, despite the fact that the video clearly shows he wasn't "dangerous" or "violent". He just needed somebody to try and talk to him. Nobody did.
There are similar cases of protestors being killed or harrassed in the UK by "security" forces that are out of control, see here, here, here, here, here, here. There are numerous cases of police in the US who shoot first and ask questions later that kill innocent people, see here, here, here, here, here, here, here, here, here. And, of course, Canada, see here, here, here.

I know that the job of the police is a tough, ugly one. But the answer is not to give them free rein to bully, threaten, and kill people. The answer is to give them better training, better pay, better support, and to weed out the thugs and bullies so that they become a professional force, not bullies in uniform. Sadly, most countries "don't see a problem". These outrageous events aren't a "problem" until they happen to you. But then it is too late. A tragedy.

The "Reagan" Economy

Here is an excellent posting by Paul Krugman on his NY Times blog that points out that the right wing "agenda" which has controlled the US since 1980 is a complete disaster that has been mythologized as an "improvement" over the golden years economy of post-WWII America. It is an incredible lie, but it is believed!
Did The Postwar System Fail?

I’ve been posting about the contrast between the popular perception on the right that America had slow growth until Reagan came along, and the reality that we did fine pre-Reagan, in fact better; see here, here, and here. And what I’m getting as a common response — including from liberals — is something along the lines of, “That’s all very well, but by 1980 the postwar system was clearly failing, so what would you have done instead of Reaganomics?”

Which all goes to show just how thoroughly almost everyone has been indoctrinated by the current orthodoxy.

How do we know that the postwar system was failing? Yes, there were some bad years — largely due to oil shocks — and there was stagflation. But stagflation was not, as far as I know — and as far as standard textbook economics says — the result of high taxes and/or excessive regulation; it was a problem of monetary policy. It’s a testimony to the strength of supply-side propaganda that so many people think they know differently.

And how bad were those bad years, anyway? Well, let’s look at real median family income over two 8-year stretches, 1973 to 1981 and 2000 to 2008, in each case with income in the first year set to 100:

Funny, isn’t it? The Ford-Carter years look no worse — in fact, somewhat better — than the Bush years, especially if you look from business cycle peak to business cycle peak. And that was in the face of two very severe oil shocks. So a question for all the people who say that the economic troubles under Jimmy Carter discredited postwar economic policies: why don’t the troubles under Bush similarly discredit post-Reagan policies? Funny how that works.

Here’s what I think: inflation did have to be brought down — and Paul Volcker, not Reagan, did what was necessary. But the rest — slashing taxes on the rich, breaking the unions, letting inflation erode the minimum wage — wasn’t necessary at all. We could have gone on with a more progressive tax system, a stronger labor movement, and so on.

In the modern vision, the old US economy is seen as an absurd, unworkable thing. Where were the incentives to grow super-rich? How did you manage with all those well-paid, organized workers? But I’m old enough to remember that system, and it was no more unworkable than what we have now. Radical change happened because a powerful political movement wanted it, not out of economic necessity.
And there is more from another Krugman post:
That was about the claim, quite common on the right, that the US economy was stagnant until Reagan did away with those nasty New Deal policies — a claim that is simply, flatly, false. The era of strong unions, high minimum wages, high top marginal tax rates, etc. was also a period of rapid growth and rising living standards. That doesn’t prove causation; it does disprove the widespread dogma that these things are always economically devastating. And it’s telling that so many on the right have airbrushed the whole postwar generation out of history.

Given all that, what do we learn from the fact that since 1980 the United States has more or less maintained its relative GDP per capita, after substantial decline previously? Well, that’s not a simple story. Part of the answer is that our relative decline for 30 years after WWII largely reflected technological catchup by others; by the 80s that catchup was largely over, with all advanced nations at roughly the same technological level, so there was no reason to expect faster growth in Europe and Japan.

There’s also an issue of labor-leisure choices. In the 70s the long-run trend of taking productivity gains out partly in the form of shorter working hours came to an end in the US, while continuing elsewhere. What that’s about is the subject of dispute, but it’s important to understand that a large part of the GDP difference between the US and Europe reflects that choice. France, in particular, is a country with about the same level of technology and productivity as America, but with roughly 25 percent lower GDP per capita; this mainly reflects longer vacations and earlier retirement, which may or may not be bad things, but are not a straightforward case of inferior performance.

But back to the original point: where this all started was with the common assertion that the US economy was a failure until Reagan came along. This should be true, according to doctrine — so that’s what people believe happened, even though it didn’t.
Even with Obama in place, the idiocy of the Reagan years continues because Obama believes in "reaching out" to the fanatics who won't give an inch. The economy has collapsed and still most people think that the right wing agenda was "the good years". They don't even understand how the Republicans destroyed the country. These people are ready to hand the keys to the country back to the crazy Republicans.

Interview of Steven Pinker

Here is an excellent dialog between Robert Wright and Steven Pinker that covers a lot of ground. This is one of the best discussions I've seen. It gets at the topics that Pinker covers in his books while including some interesting side trips into topics of interest to Wright. This is well worth taking the time to watch. This is an interview conducted by Robert Wright on

Dehaene on Consciousness

Here is a video from with Stanislas Dehaene, a brain scientist, talking about consciousness. This is from issue 306 of Edge:

His discoveries are technical. Just what you would expect. instead of a blinding realization of something overlooked, this research is building up lots of technical detail which at some point in the future will enable us to have a better model of "consciousness":
What do we see when we do these experiments? The first thing that we discovered is that, even when you cannot see a word or a picture, because it is presented in a subliminal condition, it does not mean that your cortex is not processing it. Some people initially thought that subliminal processing meant sub-cortical processing — processing that is not done in the cortex. It's of course completely false and we've known this for a while now. We can see a lot of cortical activation created by a subliminal word. It enters the visual parts of the cortex, and travels through the visual areas of the ventral face of the brain. If the conditions are right, a subliminal word can even access higher levels of processing, including semantic levels. This is something that was highly controversial in psychology, but is now very clear from brain imaging: a subliminal message can travel all the way to the level of the meaning of the word. Your brain can take a pattern of shapes on the retina, and successively turn it into a set of letters, recognize it as word, and access a certain meaning — all of that without any form of consciousness.

Next comes the obvious question: where is there more activity when you are conscious of the word? If we do this experiment with fMRI, what we see is that two major differences occur. You first see an amplification of activation in the early areas: the very same areas begin to activate much more, as much as tenfold, in for instance, this area that we have been studying and which looks at the spelling of words: the visual word form area.

The second aspect is that several other distant areas of the brain activate. These include areas in the so-called prefrontal cortex, which is in the front of the brain here. In particular, we see activation in the inferior frontal region, as well as in the inferior parietal sectors of the brain. What we find also is that these areas begin to correlate with each other — they co-activate in a coordinated manner. I am for the moment just giving you the facts: amplification and access to distant areas are some of the signatures of consciousness.


What I propose is that "consciousness is global information in the brain" — information which is shared across different brain areas. I am putting it very strongly, as "consciousness is", because I literally think that's all there is. What we mean by being conscious of a certain piece of information is that it has reached a level of processing in the brain where it can be shared.

Because it is sharable, your Broca's area (or the part of it involved in selecting the words that you are going to speak) is being informed about the identity of what you are seeing, and you become able to name what you are seeing. At the same time, your hippocampus is perhaps informed about what you have just seen, so you can store this representation in memory. Your parietal areas also become informed of what you have seen, so they can orient attention, or decide that this is not something you want to attend to… and so on and so forth. The criterion of information sharing relates to the feeling that we have that, whenever a piece of information is conscious, we can do a very broad array of things with it. It is available.

Now, for such global sharing to occur, at the brain level, special brain architecture is needed. In line with Bernard Baars, who was working from a psychological standpoint and called it a "global workspace", Jean-Pierre Changeux and I termed it the global neuronal workspace. If you look at the associative brain areas, including dorsal parietal and prefrontal cortex, anterior temporal cortex, anterior cingulate, and a number of other sites, what you find is that these areas are tightly intertwined with long distance connections, not just within a hemisphere, but also across the two hemispheres through what is called the corpus callosum. Given the existence of this dense network of long-distance connections, linking so many regions, here is our very simple idea: these distant connections are involved in propagating messages from one area to the next, and at this very high level where areas are strongly interconnected, the density of exchanges imposes a convergence to a single mental object out of what are initially multiple dispersed representations. So this is where the synchronization comes about.

Synchronization is probably a signal for agreement between different brain areas. The areas begin to agree with each other. They converge onto a single mental object. In this picture, each area has its own code. Broca's area has an articulatory record and slightly more anterior to it there is a word code. In the posterior temporal regions, we have an acoustic code, a phonological code, or an orthographic code. The idea is that when you become aware of a word, these codes begin to be synchronized together, and converge to a single integrated mental content.

According to this picture, consciousness is not accomplished by one area alone. There would be no sense in trying to pinpoint consciousness in a single brain area, or in computing the intersection of all the images that exist in the literature on consciousness, in order to find the area for consciousness. Consciousness is a state that involves long distance synchrony between many regions. And during this state, it's not just higher association areas that are activated, because these areas also amplify, in a top-down manner, the lower brain areas that received the sensory message in the first place.
Put crudely as "consciousness is state of synchrony" doesn't create the "aha!" moment. But I suspect that as the full implication of consciousness is unraveled, there will be no "aha!" moments. But bits and pieces will make sense and there will be the necessary experimental evidence backing up the model. We will simply come to live with the "understanding" that this model implies.