DeLong Posts a Marxist Classic

I was reading Brad DeLong's blog and enjoyed seeing this. It reminded me strongly of Charlie Rose's interview with Michael Moore. Moore was demanding a more "democratic" economy. Especially since the ordinary taxpayers are having to give trillions to the fat cats who create these economic disasters.

Here's the text of the program. To me it reads as a set of very reasonable demands. It was crafted in 1875 by the German Socialists:

The Socialist Labor party of Germany demands as a step to the solution of the social question the erection, with the help of the state, of socialistic productive establishments under the democratic control of the laboring people. These productive establishments are to place industry and agriculture in such relations that out of them the socialist organization of the whole may arise.

The Socialist Labor party of Germany demands as the foundation of the state:

1. Universal, equal and direct suffrage, with secret, obligatory voting by all citizens at all elections in state or community.


2. Direct legislation by the people. Decision as to peace or war by the people.


3. Common right to bear arms. Militia instead of the standing army.


4. Abolition of all laws of exception, especially all laws restricting the freedom of the press, of association and assemblage; above all, all laws restricting the freedom of public opinion, thought and investigation.


5. Legal judgment through the people. Free administration of law.


6. Universal and equal popular education by the state. Universal compulsory education. Free instruction in all forms of art. Declaration that religion is a private matter.

I've always found it odd that we claim to be a democratic society but the place we spend most of our time, the workplace, is a petty dictatorship. Sure, the stockholders get a kind of representative democracy where they vote for board members to run the company. But the workers are throwaway "tools" of production. At least in Germany workers get a seat on the board. It makes sense to me that boards of directors of a modern corporation need to include representatives of the workers and representatives of the large community as well as the stockholders who represent the capital put down to create the company. It is blind to run a company purely with the interests of stockholders.

When I was in high school my civics teacher passed me a copy of the Communist Manifesto to read. I was shocked at how reasonable this left wing fanatical propaganda sounded. I've since learned that Marx was a jerk. He used and abused people. He sabotaged his contemporaries if they didn't fall in behind him. His ruthless methods were honed by Lenin and the later Communists into the idiocy of Communist dictatorships. But the socialist (and even communist) literature of the 19th century sounds pretty reasonable today. This was simply people wanting a fairer deal out of life. The rich had oppressive control and they wanted a better life out from under the thumb of the capitalist class.

Alan Beattie's "False Economy"

I was surprised by this book. It isn't a "history" in the sense of walking through a timeline and discussing people, theories, or places. Instead, this was an enjoyable romp through various economic puzzles. He starts with the strange fact that Argentina and the United States were poised at the top of the heap of developed countries at the start of the 20th century, but by the end, the US was still on top, but Argentina has dropped down into the "developing" class of countries. Why? He looks at various facts and theories and helps you appreciate how decisions have consequences.

He ends his book by looking at pandas and compares them with cats:

Giant pandas are incompetent, inefficient, piebald buffoons, and we should end their public subsidies and let them die out. I once said that in the pages of an international newspaper, and the responses of outraged readers comparing me to a genocidal dictator flooded in for days. I stand by my views, however, and am now going to draw them out to create a slightly tenuous metaphor for economic development.

He goes on to point out that cats are adaptable, interact to "carry their weight" and be useful. It is a great metaphor for the economic scene with hopeless countries that, like pandas, need a lot of help to struggle on. While other countries, like cats, take what's available and make something of it.

The book looks at countries and history with a deft hand to prize out an insights. The style is light and enjoyable while the topic is serious. This is the kind of serious book that the general public wants because it exposes you to contemporary thinking without the dead hand of an academic writing style. Each chapter is organized around a topic posed as a question:

• Why did Argentina succeed and the United States fail?


• Why didn't Washington D.C. get the vote?


• Why does Egypt import half its staple food?


• Why are oil and diamonds more trouble than they are worth?


• Why don't Islamic countries get rich?


• Why does our asparagus come from Peru?


• Why doesn't Africa grow cocaine?


• Why did Indonesia proper under a crooked ruler and Tanzania stay poor under an honest one?


• Why are pandas so useless?

Go get the book, read and enjoy!

Dowd Hoists Obama on his own Petard

This is funny. Here's the opening bit of Maureen Dowd's take on the Nobel "Peace" Prize going to Barack Obama:

When he heard the Nobel Peace Prize shocker on Friday, Bill Clinton went into one of his purple rages. He picked up the phone and dialed the one person on earth who would be as steamed as he was.

CLINTON: Hey, man, it’s me. This thing is plumb crazy. Can you believe it?

W: No way, Jose!

CLINTON: First that prig Carter. Then that prig Gore. And now President Paris Hilton. The guy’s in office three days and he gets the peace prize? He should have gotten the Nobel in chemistry, because chemistry’s all he’s got. Talk about a fairy tale. This ... is ... just ... wrong! It’s killing me, man. I feel like my head’s explodin’. First I had the vast right-wing conspiracy, and now I have the vast left-wing conspiracy.

W.: I hear ya, 42. As if his head wasn’t big enough. This cat is all cage, no bird. He doesn’t have a clue.

CLINTON: Heck no.

...

CLINTON: Maybe you’re right, George. Some winners think the Nobel’s the kiss of death. Any peace prize that goes to Henry Kissinger but not Gandhi ain’t worth a can of Alpo. Heck, if Gandhi had known he was going to lose out to Henry the K, he could have had more time to eat french fries and chase girls.

Go read the whole thing to get the full effect of the ridicule heaped on Obama and the Nobel "prize" committee. Dowd skewers Obama, Bush, Clinton, the Nobel apparatchiks, etc. It is just too funny.

Interview of Michael Moore

Charlie Rose interviews Michael Moore talking about his new documentary Capitalism: A Love Story. The most touching part of this interview comes at the very end when Moore talks about his disappointments with Obama.

Moore worries that the most lasting damage from Obama may be the cynicism that will erupt when their hoped for "change" never arrives. This will destroy the young people's idealism. They got involved in the 2008 election on the hope for real change. When that isn't delivered, it may gut a generation of voters. That is a true horror story.

Moore still has some hopes that Obama will deliver, but he is clearly coming to the end of his rope. Personally, I've decided that Obama has sold out to the rich and there is nothing but crumbs off the table to hope for from Obama. Sure the crumbs may be more than what Bush 43 gave the people, but it is too little. The system is showing that it is too corrupt for reform.

Moore and Rose talk a bit about a revolution brewing among disaffected Americans. For me, that would be a great tragedy. Institutional change is far, far better than a revolutionary break since so much arbitrary violence and destruction comes a true revolution. I fervently wish that Obama will break from the cronies around him that have sold his soul to the big financiers so that this fate can be avoided.

For the interview, go the the Charlie Rose web site and click on Michael Moore.

Krugman on the Inflation Hawks

The wealthy are worried about keeping the value of the dollars up since they think they sense impending "inflation". They don't care that mass unemployment is terrible or that the economy is faltering. They just want to make sure that their sacks of dollars keep their value. This is the insanity behind the rumbling from various heads of the Federal Reserve and various right wing nuts.

Here is the key bit from Paul Krugman's latest op-ed in the NY Times:

The economic historian Peter Temin has argued that a key cause of the Depression was what he calls the “gold-standard mentality.” By this he means not just belief in the sacred importance of maintaining the gold value of one’s currency, but a set of associated attitudes: obsessive fear of inflation even in the face of deflation; opposition to easy credit, even when the economy desperately needs it, on the grounds that it would be somehow corrupting; assertions that even if the government can create jobs it shouldn’t, because this would only be an “artificial” recovery.

In the early 1930s this mentality led governments to raise interest rates and slash spending, despite mass unemployment, in an attempt to defend their gold reserves. And even when countries went off gold, the prevailing mentality made them reluctant to cut rates and create jobs.

But we’re past all that now. Or are we?

America isn’t about to go back on the gold standard. But a modern version of the gold standard mentality is nonetheless exerting a growing influence on our economic discourse. And this new version of a bad old idea could undermine our chances for full recovery.

Consider first the current uproar over the declining international value of the dollar.

The truth is that the falling dollar is good news. For one thing, it’s mainly the result of rising confidence: the dollar rose at the height of the financial crisis as panicked investors sought safe haven in America, and it’s falling again now that the fear is subsiding. And a lower dollar is good for U.S. exporters, helping us make the transition away from huge trade deficits to a more sustainable international position.

But if you get your opinions from, say, The Wall Street Journal’s editorial page, you’re told that the falling dollar is a terrible thing, a sign that the world is losing faith in America (and especially, of course, in President Obama). Something, you believe, must be done to stop the dollar’s slide. And in practice the dollar’s decline has become a stick with which conservative members of Congress beat the Federal Reserve, pressuring the Fed to scale back its efforts to support the economy.

The rich have never cared about the poor. I joke that during the feudal age the rich lords used serfs in the field for target practice. It kept their skills honed. Did they care that they killed the peasants? Nope, they breed like rats, so the big shots didn't care. Well, we aren't all that far removed from the same kind of thinking today.

The rich don't care that the poor will have to pay the penalty for the greed of Wall Street through taxes to retire the huge deficits being run up. The rich are only concerned that they get "made whole" by tax dollars when their business schemes fail. And they want to make damned sure the poor don't take anything from the public coffers. Those are reserved for the "deserving" rich.

So the campaign is on to start raising interest rates, cutting back government spending, suppressing "runaway" economic growth. All while unemployment is headed over 10% and millions are losing their homes and can't afford medical care. But as the rich view it, those are the petty problems of rats who quickly multiply, so who cares?

Energy: One Man's Guess

Here is an assessment of where the US is now with energy and where it may be in 12 years by Geoffrey Styles on his blog Energy Outlook:

This picture starts with our total primary energy consumption in 2008 of 99.3 quadrillion BTUs (quads.) Nearly three-fourths of our needs, or 73.7 quads, were produced domestically by a mix of 79% coal, oil and natural gas, 11.5% nuclear power, and a bit over 3% hydropower. Non-hydro renewables--the wind, solar, geothermal and biomass power plus biofuels that constitute the primary focus of US energy policy today--made up the remaining 6.5% of domestic energy production. Now add the 26% of US energy consumption supplied by imports, mainly crude oil and petroleum products, and we have the breakdown shown at the left hand edge of the graph. The rest of the picture is the result of a highly simplified set of assumptions based on phasing out fossil fuels and replacing them with the non-hydro renewables that have been growing so rapidly. It ignores such important considerations as reliability and intermittency, compatibility with infrastructure, and turnover of vehicle fleets.

According to the Energy Information Agency's data, while wind and solar power have been growing at roughly 30% per year each, the total renewables category has been growing at a somewhat slower pace, even after separating out hydropower, which has actually declined significantly since the 1990s. While the average growth rate for all the non-hydro renewables since 2000 has been around 4%, I've more than doubled this for the purposes of my projection to 10%. Renewables would do very well to sustain that kind of pace over the next 11 years, because the bigger they get, the more capital they will require each year to add the next year's increment of growth, and the more hurdles they will face, particularly from NIMBY or "energy sprawl" concerns. 10% compound growth would see these renewables more than triple by 2020, providing plenty of room for biomass/biofuels to double and for wind and solar to double several successive times.

...

The biggest impact in the graph above comes from my assumption that domestic fossil fuel production would fall by 5% per year. That will probably seem extreme to some and timid to others. It certainly looks extreme in the context of the recent surge in natural gas production and the stable output of US coal mines. Even US oil production has staged a bit of a comeback recently, thanks to successes in the portions of the Gulf of Mexico where drilling is allowed.

The future is difficult to foresee. I'm expecting radical technlogical change to change the energy infrastructure, but that is purely a guess on my part. Styles is an expert, so you have to give weight to his estimates. But the joke is that experts have a terrible track record at foreseeing the future. It is that Catch-22, the future is hard to foresee because it is in the future.

The Rumsfeld Doctrine

It seems to me that the US continues with the "Rumsfeld doctrine", i.e. you don't supply troops with what they need, you don't train them in skills you need, instead you ship them out "as is". Or, as Rumsfeld enshrined it as doctrine: "You go to war with the Army you have, not the Army you might want or wish to have." (I would love to have seen the result of WWII if FDR has followed Rumsfeld's "doctrine".)

Here's a bit out of an article in The New Republic by Ganesh Sitarama that talks about his experience at Camp Julian's Counterinsurgency Training Center in Afghanistan:

"How many of you have read David Galula’s Counterinsurgency Warfare: Theory and Practice?" Lt. Colonel Matt Galton, the deputy director of the center, asked in his Australian accent. Two hands slowly went up. It was not surprising. Though Galula’s book is a--possibly the--classic starting point for counterinsurgency, it was written over 40 years ago and isn’t required reading. More troubling, when Galton asked how many had read the Counterinsurgency Field Manual, only about five hands went up.

This was surprising, given how pervasive, even trendy, counterinsurgency has become in policy circles. In the nearly three years since the release of the Counterinsurgency Field Manual, its authors have gone on to fame, at least in the public policy world: Nagl appeared on "The Daily Show"; Kilcullen is a frequent television commentator; and Petraeus, the lead author of the manual, is now the head of U.S. Central Command--in charge of the military’s operations in the Middle East. But, despite the coaches’ rise to prominence, most of the players haven’t read the playbook.

"I didn’t even know counterinsurgency was a term," Lieutenant Aaron Lewis said of his tour of duty in Iraq in 2004 and 2005. "I felt something was wrong with what we were doing ... but I didn’t know what."

...

One key tenet of counterinsurgency is that you need to understand the local population. Spending time at Camp Julien made clear that we still have a long way to go on that front. When an Afghan interpreter asked the students during a presentation how many read the local papers, listened to local radio, or had someone translate or brief them on the local news each day, about a dozen (out of 130) raised their hands. In a debriefing session later that day, a group of young officers asked why their commanders didn’t require everyone to follow the local news. Another officer said he had met fellow officers who explained that they were too busy to sit down over tea with village elders in order to build strong relationships; they only had time for official meetings.

But the problem runs deeper than just keeping up with local news or having the requisite cups of tea with residents. Instructors at Julien worried about the fear of casualties--particularly the fear of IEDs--pushing troops and civilians to stay on their bases as much as possible. The Counterinsurgency Field Manual rejects this approach, noting, in perhaps its most difficult paradox, that "sometimes, the more you protect your force, the less secure you may be.” In the long run, the security of the base is a mirage: It leaves the population constantly at risk and increases the danger to soldiers whenever they venture out. And it prevents soldiers from understanding the people they are trying to protect.

The article is good. It is well worth taking time to read it.

My thoughts? Giants have feet of clay. The head is so far removed from the feet, that the head never worries where the feet might be stuck. The US goes to war and can't be bothered to figure out if it has the right "enemy" or if its troops are provisioned and prepared. Instead it asks "sacrifice" of the "little people" so that the big shots in Washington can strut on the world stage. Pathetic.