Who killed Col. Mustard?

It was Laureate Stiglitz, in the park, with a microphone

(clic the pic for a more glorious image)

The spending cuts in the budget deal are a pitiful joke

A trillion dollars sounds like a lot of money, doesn't it? Well when it's (A) over 10 years and (B) from a spending level that is around 3.8 trillion for the current year, it's ez to see that a trillion dollars of cuts is a joke. Pro-rated, that's $100,000,000,000 cut each year from a level of $4,800,000,000,000. Which is 2% and change. Which is pitiful.

Plus, the cuts aren't cuts. Here's Ezra Klein on Harry Reid's cuts:

Reid’s plan includes $100 billion in savings from so-called “mandatory spending” like Fannie Mae and agricultural subsidies, $1 trillion in savings from winding down the wars, and $400 billion in reduced interest payments from cutting more than $200 billion in spending.

So a mere $10,000,000 per year of actual spending cuts while the rest comes from "winding down the wars" and reduced interest payments from winding down the wars.

Sweet baby Jeebus!

Ain't that just like a boss to totally fudge the numbers and con the shareholders?

Mungowitz is right. This is pro wrestling.

Markets in Everything: Snacks for Zombies Edition

(clic the pic for a more glorious image)

And here's a bonus MIE: Personal Hygiene Edition:

Maybe This Time

Usually, when I think something is a turning point, it turns out to be a high water mark. Sort of like how Woodstock was not a fundamental step forward in hippie culture, but its never-to-be-repeated apotheosis, after which a lot of boomers starting to go bald (even the women) and get jobs as I-bankers and stockbrokers.

So, with that caveat, let me offer this piece by KPC pal Dave Weigel as a turning point, something we may look back and remember as a start, not an end.

This rant was the start, in some ways, of the organized Tea Party movement. This article by Weigel was basically the end of my campaign, though that wasn't Dave's fault. Beginnings or ends... who can tell, at the time?

Thus it is with the #FuckYouWashington hashtag, and American Elect. The question is whether the idea for a "real" third party (LP is apparently chopped liver?) will catch on. Dave is absolutely right, of course, that electing a President would do very little. Except that it would do a lot. Veto points only work if MCs have the juevos to block stuff. And pretty much none of the MCs have juevos.

(Nod to Brendan Nyhan, or rather @brendannyhan, for the link)

Speech in Indy

My speech in Indianapolis, for the LPIN. (It's long, 52 mins...)

with a Greece-y spoon

Wow. Version N minus k of the Greek bailout has arrived (where k is a positive integer). You can read the full text here.

I want to talk about the losers in this process.

The biggest loser is JC Trichet and the ECB. Man they really had to eat it. JC thundered "no default ever" to whoever would stick a microphone in front of him and threatened that in the event of a default, the ECB couldn't hold Greek debt. Well, now we (a) have a default and (b) the ECB will continue to hold, and add to its holdings of Greek debt. By acting like he was large and in charge when he was not, JCT has made himself look like a clown and damaged whatever positive reputation the ECB still had.

The next big loser is the sovereign CDS market. We have an obvious default, that according to my understanding (and that of the WSJ), will somehow NOT be creating a credit event. That is, holders of CDSs on Greek debt will NOT be getting payouts. In other words, the sovereign CDS market has been revealed to be a mug's game and may find it hard to survive. Governments may think they have won against the evil speculators, but all this victory will really do is drive up interest rates on sovereign debt (ceteris paribus, y'all).

The next loser is the German taxpayer, especially if the Eurolords actually follow through with their threat of a "Marshall plan for Greece".

Hey Angus! How about a word or two on the winners.

Well, Ireland and Portugal are big winners as they got the interest rates on their bailout loans cut dramatically without having to make any additional changes to policies. A good deal for them.

I also think holders of Greek debt are winners here, as they can lock in a decent return on their holdings for a not too bad haircut. I would take one of the deals.

Any other losers?

Finally and amazingly, Greece itself is again a loser in its own bailout. Some things never change I guess. They still have a mountain of debt, they still face prolonged austerity and God help them if the Eurolords follow through with their politically correct, bureaucratically bungled, economically useless version of a Marshall plan for that beleaguered island.

This is why Lefties say "It's ALL Luck!"

Social Insurance and Income Redistribution in a Laboratory Experiment

Justin Esarey, Timothy Salmon & Charles Barrilleaux
Political Research Quarterly, forthcoming

Abstract: Why do some voters support income redistribution while others do not? Public assistance programs have two entangled effects on society: they equalize wealth, but they also cushion people against random catastrophes (like natural disasters). The authors conduct a laboratory experiment to determine how individuals' responses to the environment are related to their self-expressed political ideology and their self-interest. The findings support the hypothesis that ideology is associated with a person's willingness to use redistribution to reduce income inequality that is caused by luck, but it is not related to preferences for inequality that are not related to luck.

(Nod to Kevin Lewis)

Resisting Arrest

This man is going to jail for resisting arrest.

Some neighbor called the police, said "a black man" was entering the house.

Of course, it was his house, if that matters.

Nope, it doesn't matter. Off to jail with you, amigo!

This is Why We Need the Interwebs

In several forums I have argued that the contribution of blogs and the interwebs to our knowledge of the "truth" in news is one-sided: We don't so much learn about definitive truth as we get decisive and embarrassing corrections of bullshit masquerading as news reporting. The idea that there is "truth" is shaky; the idea that there is demonstrably false crap is where bloggers come in.

A fine example of this genre is KPC pal M.G.'s piece on shale oil. I'm pretty sure this would embarrass the Times reporter, if the Times reporter were capable of embarrassment (meaning, he couldn't be a Times reporter, I guess). The Times keeps firing its "public editor," who is supposed to be their conscience. I don't think the current public editor is long for this world, if he is going to commit actual journalism like this.

Don't Want Those Third Parties "Spoiling" Elections!

Utah may decide to go with IRV to avoid "spoiling" elections.

Really.

(Nod to the Bishop, who has spoiled a lot of elections all by himself)

I don't fault the police, 'cause the people that run 'em, got 'em on a short leash

The strange thing is that people want to blame the police for this. Cops shut down a lemonade stand being run by 10 year old girls. Excerpt:

“They told us to shut it down [and we didn't know why],” 10-year-old Skylar Roberts said.

“We had told them, we understand you guys are young, but still, you’re breaking the law, and we can’t let you do it anymore. The law is the law, and we have to be consistent with how we enforce the laws,” Midway Police Chief Kelly Morningstar said.

By a city ordinance, the girls must have a business license, peddler’s permit, and food permit to set up shop, even on residential property. The permits cost $50 a day and a total of $180 per year. City officials said it’s their job to keep everyone safe and healthy, and there can be no exceptions to the rules.

“We were not aware of how the lemonade was made, who made the lemonade, of what the lemonade was made with, so we acted accordingly by city ordinance,” Chief Morningstar said.

“It’s almost like they don’t have anything better to do. I’m going to let it go. I’m trying to teach them good. I don’t think if I keep on, it’ll teach them a good thing,” Amy Roberts said.

So the law wins, and what started out as three girls’ dream of a fun summer business is now just a piece of plywood.

This REALLY makes me mad. All you folks who constantly want more rules, more laws, more government intrusion in our lives are the first say, "Awwww, that's not right!" when the police actually try to enforce the law. In fact, the reporter actually says, "So the law wins..." Um...that's what the law DOES, ma'am. The political law of the U.S. is a set of arbitrary, intrusive rules backed by overwhelming, irresistible physical force. It is the unavoidable implication of the corrupt bargain made by those who think the alternative to coercive law is the Hobbesian state of nature. Letting people make their own choices is just not an option to you folks. So enjoy your police state, and STFU.

Look, as I have written before, Chief Morningstar is right: she can't just suspend the law. The thing, the thing itself is the abuse. People who try, like this goofball, to blame the police are just mistaken. Police do not have, and should not have, discretion. It's a violation of equal protection, and in fact a violation of the very idea of rule of law, for the police to say "The law applies to you, but not to you over there."

Then what IS the solution? Get rid of about 3/4 of the stupid rules on the books. These licenses, fees, and paperwork are an important cause of extended unemployment problems.

Corporate Avenger has this pretty much right, I think. I don't fault the police. 'Cause the people that run 'em got 'em on a short leash. (Definitely NSFW, and extremely harsh. Don't watch it if you are a pussweiler)


The money quote from the video:

A society that incarcerates its own population for any minor infraction where there is 100's upon 1000's of pages and pages of laws and reason for the district attorney and the local jurisdiction and the justice system to put its entire force to removing an individual from his family connection...
Enforce rules made by fools
Violence and fear their tools,
They dress to impress thinking fear is respect
And they leave us powerless.

So don't fault the police, folks.

(Nod to Tommy the Brit)

UPDATE: Don't hate the DA, hate the game.

.

Does Where You Start Determine Where You End Up?

Sources of Lifetime Inequality

Mark Huggett, Gustavo Ventura & Amir Yaron
American Economic Review, forthcoming

Abstract: Is lifetime inequality mainly due to differences across people established
early in life or to differences in luck experienced over the working lifetime? We answer this question within a model that features idiosyncratic shocks to human capital, estimated directly from data, as well as heterogeneity in ability to learn, initial human capital, and initial wealth. We find that, as of age 23, differences in initial conditions account for more of the variation in lifetime earnings, lifetime wealth and lifetime utility than do differences in shocks received over the working lifetime.

(Nod to Kevin Lewis)

The culture that is Germany: Naturist Edition

The quantity theory of nudity may be holding in Germany. It appears that perhaps the same amount of skin is being shown by nude sunbathers; it's just been redistributed. Now there's a lot more skin on each of the much fewer naked bodies.

Or, as Reuters puts it, "Fatter & Fewer German Nudists as Numbers Dwindle"

Kurt Fisher, the head of the German Nudist Association, thinks he knows why the numbers are dwindling. Immigrants! Or more specifically, the wrong kind of immigrants:

""Germany is relying more and more on immigrants to keep the population steady. But many come from countries with strong religious beliefs." Immigrants who arrive from cultures where headscarves are common will not usually be interested in becoming naturists in Germany, he said."

Don't you just hate it when that happens?

Lost Interest

Institutions, the Rise of Commerce and the Persistence of Laws: Interest Restrictions in Islam and Christianity

Jared Rubin
Economic Journal, forthcoming

Abstract: Why was economic development retarded in the Middle East relative to Western Europe, despite the Middle East being far ahead for centuries? A theoretical model inspired and substantiated by the history of interest restrictions suggests that this outcome emanates in part from the greater degree to which early Islamic political authorities derived legitimacy from religious authorities. This entailed a feedback mechanism in Europe in which the rise of commerce led to the relaxation of interest restrictions while also diminishing the Church’s ability to legitimise political authorities. These interactions did not occur in the Islamic world despite equally amenable economic conditions.

(Nod to Kevin Lewis, who never loses interest)

Glorious

What Really Happened During the Glorious Revolution?

Steven Pincus & James Robinson
NBER Working Paper, July 2011

Abstract: The English Glorious Revolution of 1688-89 is one of the most famous instances of ‘institutional’ change in world history which has fascinated scholars because of the role it may have played in creating an environment conducive to making England the first industrial nation. This claim was most forcefully advanced by North and Weingast yet the existing literature in history and economic history dismisses their arguments. In this paper we argue that North and Weingast were entirely correct in arguing that the Glorious Revolution represented a critical change in institutions. In addition, and contrary to the claims of many historians, most of the things they claimed happened, for example parliamentary sovereignty, did happen. However, we argue that they happened for reasons different from those put forward by North and Weingast. We show that rather than being an instance of a de jure ‘re-writing the rules’, as North and Weingast argued, the Glorious Revolution was actually an interlinked series of de facto institutional changes which came from a change in the balance of power and authority and was part of a broader reorientation in the political equilibrium of England. Moreover, it was significant for the economy not because it solved a problem of credible commitment, but for two other reasons. First, because the institutional changes it led to meant that party political ministries, rather than the king’s private advisors, now initiated policy. Second, because these ministries were dominated by Whigs with a specific program of economic modernization.

(Nod to Kevin Lewis)

Lavish Links

1. The wit and wisdom of Larry Summers

2. Andrew Gelman lays a smackdown on "pop economists"

3. Are you geographically literate enough to be a 12th grader?

4. Don't let the door hit you in the butt on the way out!

Lil Bautista eat your heart out

Cause here's Lil Herschel, and he's packing a lot more than a sharpie goatee.

Check his moves:

Check his workout:

More here.

Dick Cheney's Erdos number

Yes, he has one, and it's probably lower than yours my friend:

"Cheney's Erdos number is no more than seven. He wrote his American Political Science Review article with Aage Clausen, who has coauthored with Greg Caldeira, who has co-authored with me, who has co-authored with Keith Krebiel, who has co-authored with John Ferejohn, who has co-authored with Peter Fishburn, who has co-authored with Erdos."

The "me" in the above quote is Tim Groseclose, one of the greatest Okies ever, and the quote comes from his awesome new book: "Left Turn: How Liberal Media Bias Distorts the American Mind" which drops tomorrow from St. Martin's press. The book is, as Tyler likes to say, self-recommending.

I could have had an Erdos of five, but I was such a crappy co-author that Tim kicked me off the project.

Update: Tim informs me that I'm not kicked off the project, it's just "indefinitely on hold".

Getting the incentives right

I can understand Chavez getting his medical treatment in Cuba. After all, the Castro brothers have the most to lose if Chavez is not longer in power. Cuba gets $3 billion plus in annual subsidies from Venezuela.

One Venezuelan blogger considers his country to be a Cuban colony:

"Cuba is very worried about its colonial outpost in South America. Things are not going well there. The Viceroy is ailing just as the province is having serious difficulties in providing the monthly stipends due to the imperial metropolis, Havana. Thus measures had to be taken before the natives become more restless than what they already are."

More here.

Copyrights be damned!

Some context is provided here.

"They call you PIGS but they don't understand"

Tea Party Hero: Bill Clinton

My good friend Bill Chafe (yes, one of the 88; deal with it) wrote a piece for the N&O this morn. And he's basically right. So I sent him this note:

Dear Bill:

I enjoyed your article in the N&O this morning.

Thought I would share a table I made up for an article I just wrote for CRITICAL REVIEW. This is total government spending per capita, in real (2010 constant) dollars, by decade:

Table: U.S. Nominal and Real (2010$) Federal Spending Per Capita
Year...NomG/Cap...RealG/Cap
1970...$1,000.... $5,500
1980...$2,600.... $6,800
1990.. $5,100.... $8,300
2000.. $6,500.... $8,300
2010.. $12,300... $12,300

(Sources: Budgetof the US Government: Historical Tables 3.2 and 7.1, and StatisticalAbstract of the United States)

So ignoring the fact that Republicans are hopeless hypocrites about tax cuts, it is pretty clear that Republicans presidents are also the cause of spending increases! That's mostly, but not exclusively, because of idiotic military spending, but that hardly matters.

The usual story about how Clinton balanced the budget was that he had huge tax increases to cover his big spending growth. Well, thanks for playing, but no.

Constant dollar Gov't spending per person was $8,300 in 1900, and was still $8,300 in 2000 when "conservative" GWB took over.

We have had exactly one president who embodied the "keep spending low, balance the budget" conservative principles of the Tea Party since 1970, and his name was... Clinton.

So, goodONya, sir. Hope to see you sometime.

Mike

What if....

What if they had an election and nobody ran?

Let's hope this movement spreads....

The culture that is Scotland

"I've been a police officer in Greenock for 20 years and so I've seen a lot of wedding parties turn nasty, but this was something else".

And that's putting it mildly. Story is here.

Lounge Chairs = Lebensraum?

This video is tremendous.

I like the tiny German swim briefs. That is what KPC pal Martin wears, though he prefers brighter colors. I still have nightmares about it.

(Nod to Tommy the Brit, who looks pretty good in German swim briefs)

Cut cut cut, cut cut defense

I don't see how anyone could look at this chart and not see an easy $2 trillion in budget cuts over the next 10 years ($200 billion per year for 10 years).

To paraphrase / update some long dead white dude: "$500 billion for defense and $200 billion back in our pockets!!"

PS: OMG, Shrub was such a bad bad bad president. And to follow him, the GOP wanted us to go with this guy:

Facial expressions entirely appropriate for these troubled times

Sausage the riot dog says "F*** tha Po-lice"

Wow, Loukanikos (Sausage) may be the most badass dog ever. He hangs out on the front lines of the Greek protests/riots. Mrs. Angus saw a post about him on the Animal Planet website, and I assumed that the pics were photoshopped. Not so.

Here is a video homage to Luke:

Good boy!!!!

Lavish links

1. The wonder that is Ron Artest (this is a must read).

2. Edwin Edwards wants a reality show.

3. Barry Eichengreen jumps the shark. He wants the "Marshall plan for Greece" to finance (and I quote) "building new solar and wind power-generating facilities, in order to turn Greece into a major energy exporter."

Hat tips to Tyler C, Keith G, and ironically, Barry E's own Twitter feed.

Should we allow insider trading?

"Insider Trading" sounds like something that should obviously be illegal.

The problem is that outlawing IT and enforcing the law rigorously ensures that share prices (or whatever the asset is) do NOT...repeat NOT...reflect all the information available about their future profitability. This argument is quite persuasive to me. Our man Don Boudreaux podcastrates the ideas pretty well.

Besides, the law now is unenforceable.

LeBron is not so sure.

Now, this study. Interesting.

Bubbles and Information: An Experiment

Matthias Sutter, Jürgen Huber & Michael Kirchler
Management Science, forthcoming

Abstract: Asymmetric distribution of information, although omnipresent in real
markets, is rarely considered in experimental economics. We study whether information about imminent future dividends can abate bubbles in experimental asset markets. We find that markets with asymmetrically informed traders have significantly smaller bubbles than markets with symmetrically informed or uninformed traders. Hence, fundamental values are better reflected in market prices — implying higher market efficiency — when some traders know more than others about future dividends. This suggests that bubbles are abated when traders know that a subset of them have an edge (in information) over others.

Sounds to me like an argument for allowing at least limited insider trading. Of course, fraud and deception (rumors and lies) would still be just as illegal, and common, as before.

(Nod to Kevin Lewis, who has been an insider for years)

Debt ceiling blues

Ok people, we are now, what, like 2 weeks away from Armageddon? Pretty impressive.

I thought I'd offer some thoughts.

First off, there shouldn't be a debt ceiling. Looking at US debt experience in WWI and WWII should be enough to convince one of that. Maybe some kind of conditional ceiling, like 70% of GDP with a suspension for declared wars and a provision to get back to 70% within 5 years of the cessation of hostilities.

Second, I am actually with the Republicans here on the no taxes part of the negotiations. Look, we already have substantial tax increases baked into the next few years. Expiration of the Bush tax cuts and a host of new taxes and fees to finance Obamacare. Absent a Republican sweep in 2012, taxes are already going up a lot in the near future. If anything, I would cut taxes now.

Third, I believe that we need to cut spending soon. I am not a fan of Federal spending being at 25% of GDP and rising, but there are better places to start than social security. How about starting with the ridiculous subsidies we give farmers and big business that distort and cause harm around the world. Stop the Ethanol madness, the sugar subsidies, the cotton subsidies, the "green jobs" subsidies. Then turn to the Pentagon. People, defense is a public good. My consumption of it does not reduce the quantity available for your consumption. Thus, there is no reason for defense spending to rise continually with population/GDP. Get the hell out of Iraq and Afghanistan. Get out of Germany and Japan. WWII ended more that 50 years ago. Oh, and get out of Greece too (yes we have soldiers in Greece!). Cut defense spending by 25% at a minimum. Oh and let's eliminate NASA too while we are at it.

Fourth, I really admire Obama's spin job on the negotiations. First he wants a "clean" raising of the debt ceiling, then he demands that taxes have to rise in order to raise the debt ceiling, and he is getting a lot of buying that it's the Republicans who are recklessly killing the debt ceiling increase

This can't be right....

This can't be right, can it?

Of course, if it were right, it might be useful. You wouldn't need to take
specific things along, you could just fabricate what you need when you get there.

The LMM is wondering if it can replicate a husband that picks up wet towels. I said no, it only makes actual copies. So the LMM is now wondering if it can make George Clooney.

The WMOE Talks About Price Controls

The Whitest Man on Earth dishes on price controls, in Forbes.

Pretty cool.

Takeaway

Unemployment benefits expiring? Please.

Wake me up when three things happen:

1. Social security/medicare/entitlement reform. Raise ages, means test, raise maximum payroll before taxes go to zero.

2. Cut DOD and other defense related spending by at least 15%. More is better, but no less.

3. Reform taxes along lines suggested by Bowles-Simpson budget commission proposal.

Everything else is bullshit. And I got to say so on the Takeaway this morn. (7 am is early for a radio show...ugh)

Self Serve Line

Masturbation may be adaptive.

Plus, there's a video of an elephant doing it. Not safe for work, or for avoiding nightmares.

The Tripod: It Lives

Hadn't been to the tripod for quite a while. Top of mountain above Park City, Utah. Pretty darned high, as Jayme is thinking in this photo... Anna the Intrepid snapped these pix, and I am reproducing them here, with all proper respect to her. (Thanks, Anna!) This was taken April 23. But still deep snow on the snowcat trail, where it got packed down all winter. That's the famed David Schmidtz wearing the long pants, with me and the Bishop guarding the rear flank in case of a follow ambush.
Once we got up, the Bishop and I conferred on strategy. (it's 3k meters. "Can you breathe yet?" "Nope, you?" "Nope.")
The obligatory triumph at the tripod shot. That's Anna the photographer (except this shot, obviously) in the pink standing to my left.

Five seconds after this shot was taken, mocking my timid old man descent in three feet of snow, Anna fell flat on her boom-boom. Bicycle shorts and snow...yeehah!

The tripod is one of my very favorite places in the world. For those who got to share it this year...thanks!

Eye Troubles

Damn, damn, thrice damn.

Trouble seeing, left eye hurting. Dr. Gupta says "macular edema," which just means its swollen. Scar tissue on retina, though it's the clear kind of scar tissue not the thick PVR kind, which is some good news.

I get two prescriptions. One is for Nevanac. 3 ml: $350. At 20 drops/ml, that almost $6 per drop. Now, we have excellent insurance, so it much less than that to me. But $6/drop? Wow.

Worrisome. If this doesn't take down the swelling, I go back under the knife for surgery to remove the scar tissue. Firetruck.

Bhide - Phelps on IMF

KPC pal Amar Bhide has a nice piece in Newsweek (with Edmund Phelps) about the IMF. Clear and useful.

Excerpt:

The Greek debacle and the North African drama raise existential questions about the IMF. Responsible governments have no business borrowing vast sums from abroad, rather than from domestic sources. That’s what tinpot regimes do. And lending even more to borrowers who can’t pay what they already owe? That’s what loan sharks and mafiosi do.

The IMF’s business model sabotages properly functioning capitalism, victimizing ordinary people while benefiting the elites. Do we need international agencies to enable irresponsible—verging on immoral—borrowing and lending? Instead of dreaming up too-clever-by-half schemes to stumble through crises after they happen, why not just stop imprudent banks from accommodating foreign borrowing by feckless governments?

Dance band on the Titanic

Oh my. Yet another story about economists behaving badly. This time it's Bruno and the Frey-ettes. Multiple self-plagiarism plus possible more traditional plagiarism or at the least incredibly sloppy literature checking.

Olaf has the full story here.

The cliff notes version is that Frey et. al basically published the same paper 4 times in different journals without any of the 4 referencing or making note of the existence of the others.

Further, there are multiple previous papers that use the same data, similar techniques and draw similar conclusions. None of them are cited in any of the Frey et. al papers.

The econ job rumors site has a huge thread on the Frey affair as well.

Not the Onion

The mind boggles.

The housing crisis/sub-prime debacle was caused by government complicity in enabling fake mortgage originators to write loans and then turn around and sell them immediately to dupes (i.e., da Fanny and da Fred). The Dems voted down an amendment that would have required a 5% down payment to meet the "qualifying restriction." So, yes, the Chris Dodd quote, "this is biased! it would restrict home ownership only to those who can afford it!" is fake (this is the satirical source of that fake quote). But the Dems acted as if that was exactly what they believed, and voted down even a 5% down payment as being racist and biased. Seriously, they did that. Really.

Okay, but surely we learned something, right?

No, to the contrary. The Justice Department is trying to hunt down banks that resist making loans to people who have zero chance of paying them back. It doesn't seem possible, but it's true.

So now we know why the Dems voted down the Corker Amendment. They actually want to force banks to make zero down payment loans to people whose only income is public assistance. We are NOT DOING ANY FAVORS to poor people if we saddle them with loans they cannot pay back. Holder and his thugs at Justice are taking another step and blaming the banks for enforcing any down payment rule (the norm used to be 20%! But now 5% is too high! Yikes! YIKES!)

The Obama administration seems genuinely surprised at employment declines and the lack of growth. If you constantly abuse financial instituions, they are not going to loan that money. And if you try to force them to loan it, the money will disappear. The Roosevelt administration tried several of the same tactics in 1935-6, and the result was a second dip, with employment crashing.

As we say a lot here at KPC: Business needs certainty. But politicians like uncertainty, and fear, creating dependency. Okay, but if you make that play, Mr. Obama, Mr. Dodd, and Mr. Holder, you can't seriously expect to see economic growth. If you pursue Peronista policies, you will get Peronista results. Go ahead and cry for us. The U.S. is becoming Argentina.

I wish this were the Onion, but it's real.

(Nod to the Blonde)

I [heart] the Orlando Five Oh

this guy loves the Orlando police department. Or, maybe he doesn't.
I think he doesn't. Or maybe he does. What do YOU think?

A dark day for economics

As if our failure to predict the financial tsunami, and our constant bickering and dithering about appropriate economic policies weren't enough, now comes Paul Ryan's Vino-gate to cast further unflattering light on us economists.

First consider the "whistle-blower" Dr. Feinberg. She seems to think you need a PhD in economics to be able to do basic arithmetic:

"I was an economist so I started doing the envelope calculations and quickly figured out that those two bottles of wine was more than two-income working family making minimum wage earned in a week."

Man I guess she has STATA on her smartphone or something 'cause that's a real brain teaser:

700-(7.25X40X2) >O

I am going to go out on a limb and say that set of calculations owed more to her being a liberal who hates Ryan and others of his ilk than being an economist.

Then consider Ryan's two dinner companions, who also turn out to be economists and to be the ones who ordered the two bottles of wine (according to Ryan). They are not exactly covered in glory either.

First, as Ryan himself points out while throwing his pals under the bus, it's a douchebag move to order the most expensive bottle on the wine list and then to double down on it shortly thereafter.

Second, getting up and throwing F-bombs at a woman, even if she's being obnoxious (or "crazy" and "possibly drunk" as Ryan put it) just ain't cool.

People, I'd like to assure you that economists are not really like this at all, but what reason would you have to believe me?

Here's another take on the situation from our friends at Popehat.

The old man & the gorilla

What does a 53 year old academic look like after clambering straight up the side of a volcano covered in rain-forest vegetation chasing a family of gorillas?

Well....like this (clik the pik for an even more tired-looking Angus):

photo is courtesy of the de Leeuw family from the Netherlands, who we met and trekked with in Bwindi.

They also sent us this great shot from Ishasha:

Berg and a Mystery

So, I have written about being in Germany last month. Three belated pictures from the experience. First, our "Hotelchen" courtyard. Really, really beautiful.
Second, the YYM and a friend, at Berg. Coolness, with Maßkrüge.
Finally, the mystery. The famed G-bike was stolen in 2009. (If you want to watch the video, it can still be seen. Sad...) It had a pirate flag. No trace of the G-bike has ever been recovered...but the pirate flag has appeared in the Archiv. How? Who? Detective (defective?) Hajo is collecting photographic evidence.
Now, I do admit that the G-bike was actually stolen by the police. I have no idea why they would take it, except perhaps that it was parked in a way that was blatantly and obviously illegal, blocking a firelane. In any case, Hajo is still on the case, and if the culprit admits to the theft, in the bar or biergarten where Hajo happens to be at that moment anyway, Hajo will let us all know.

San Fran Realism

It seems it's California / China day here at KPC

The San Francisco - Oakland Bay Bridge half of which is in Nancy Pelosi’s 8th Congressional district is being rebuilt.

Governor Jerry Brown has decided that CA has to build the bridge without Federal Funding. Why would he do that?

Because...the buy American provisions of the USDOT would prohibit using Chinese Steel.

And using the cheaper steel saves more than the fed funding would save. Using Chinese steel is expected to save $400,000,000 on the $7,200,000,000 Bridge. The Bridge financing is made possible by two key aspects. First, the 270,000 vehicles per day on the bridge pay $6 per crossing during peak hours to $4 in the off peak currently. These user fees provide a substantial share of funding.

The second aspect is that the federal funds are not lost but can be applied to myriad of other California projects that are eligible for federal funding with much smaller surcharges for protectionism, allowing some reallocation of state user taxes to be used in rebuilding the Bay Bridge.

So...when it suits him, Jerry boy is a right capitalist, shi?

(With thanks to JS, who wrote in)

The wisdom of the American businessman

People, did you know that California was bankrupt? Me neither.

Did you know that the Chinese government "manages its economy with incredible care"? Me neither.

Do you know that the US really needs to make some cool five year plans like China (and the Soviet Union, and North Korea and Cuba)? Me neither.

That is, I didn't know any of these gems until I read Robert J. Herbold's Op Ed in today's WSJ, which is titled "China vs. America: Which is the Developing Country?" (I am not making any of this up).

Here is a link to the article and let me highly recommend it as a fun way to start your day.

If I understood how to do it, this would be a great "grand game" opportunity.

Not the Onion...Or Is It?

Some stories that are not the Onion...probably.

1. Guys take flattened, dried alligator for joy ride.

2. Duck tape used to save...ducks! And, yes, I mean "duck tape."

3. Food trucks, food trucks, what ya gonna do? What ya gonna do when the mayor comes for you? Make a ...Facebook page! And then "unlike" Mayor Bloomberg.

4. Having medical insurance increases the amount of health services people consume. Tomorrow: sun rises in the east.

5. Rod Stewart is mistaken for author's elderly aunt.

6. Michigan Congressman had no idea that law outlawing light bulbs would put "Washington in charge of decisions over light bulbs."

(Nod to the Blonde, Angry Alex, and The Chelsea)

A day in the life of the worst aid worker in the world.

Check out this incredibly long blogpost about perception vs. reality of being an aid worker. I want to focus on the reality part, where the guy goes through his day in a very whiny, arrogant and incompetent manner, winning my nomination for worst aid worker in the world.

Here's the beginning of "the reality"

6.00 am. The alarm goes off. I open my eyes and I stare at a ceiling I swear I’ve never seen before. I hear the sound of excessively honking traffic and gridlock and recognize the stark-white detailing of some mid-range hotel in yet another third-world city, virtually indistinguishable from the last. I’m feeling a rough. Probably the combination of a little too much cheap local beer without a confirmed % Vol. rating, and the dodgy sushi restaurant we tried last night around the back of the block. There’s something about raw fish when you’re several hours’ journey from the nearest seaport.

So the guy is some combo of stupid and irresponsible, drinking too much and eating dangerously on a work night. Not a good start. I'm going to go on a limb and assume that aid workers are not actually required to do this.

6.35 am. I’m in the shower. All lathered up with generic hotel-room shampoo that oozes out of the little bottle like that slimey thing from Ghostbusters. I’m standing beneath the spout when the water suddenly runs cold. I don’t react, because it’s happened so many times before, but the little pulse of revulsion it sends through my gut is unavoidable, as I attempt to finish my wash as quickly as possible. I tell myself I really ought to speak to reception about getting my room changed, but I know it won’t make any difference, so I don’t bother.

OMG, the hot water ran out. Let the revulsion flag fly. Oh the unimaginable horror! Plus I love the assumption of the worst about the hotel management.

7.05 am. The hotel has a buffet breakfast. Dry turkey-bacon, watery scrambled eggs, stale bread for toasting, salty baked beans, fresh buns with little packets of Anchor butter and bowls of jam you never know if you can trust or not. It’s open-air and mild, but the flies aren’t out yet. It’s early, so the clientelle are all professional. There’s a bunch of despondant-looking aid-worker types mixed in with Chinese businessmen and the occasional wizened long-termer, generally white with greying hair, wrinkles, and a red veiny nose. I try and decide which group I least want to sit close to and work through my tea and toast in peace.

Every piece of food gets it’s own scornful adjective (dry, watery, stale, salty), and our hero, seeing no one of his high level in the dining room breakfasts alone.

7.30 am. My teeth are brushed (I’ve risked using tap-water this morning) and I’m waiting by the front entrance to the hotel for the office driver to pick me up, laptop, notepad and file in the backpack slung over one shoulder.

7.55 am. My driver arrives.

OMG again. His DRIVER is late. Let’s flog him as a lesson for next time.

8.25 am. We’re still in traffic. It’s rush hour, and there’s four lanes of moving metal slowly extricating itself through a narrow two-lane intersection. A bus the size of a small ocean-going liner is sitting directly above our rear-bumper, sounding its air-horn and telling us in no uncertain terms that if we don’t move forwards it will turn us into fine and somewhat stained aluminium foil. Two taxi cabs are trying to usurp the two square feet of space in front of us between a produce lorry and an expensive Mercedez sedan with tinted windows. A street vendor is banging on my window and trying to sell me my choice of cell-phone cards or a pack of cigarettes. The driver has the air-con cranked way too high and my finger-tips are actually hurting from the cold, but I’m frightened that if I crack the windows, we’ll both die of carbon monoxide poisoning.

Hey Genius. Rush hour = traffic. If you don’t want to be stuck in traffic, don’t start your commute during rush hour. Mrs. Angus and I lived in Mexico City for 2+ years and had to do exactly that. We made sure to leave the house (driving ourselves by the way) by 7:00 to ensure that our 20 minute commute didn’t turn into a 90 minute nightmare. Take some responsibility for yourself, dude. (Notice that he’s complaining about the cold. That will change)

8.40 am. The office elevator is out of order again, so I climb the three underlit flights of stained, grimy stairs that reek of cheap cologne and stale spicy food until I reach the right floor. In the humidity, I’m already sweating and my shirt is clinging to my back, my sides, and the cleft below my neck. I tell myself I need to spend more time in the hotel gym if I can’t handle three measly flights of stairs. I walk in on the morning operations briefing ten minutes late and cop a dirty look from the Office Manager.

OMG yet again. The elevator is out! How this guy has the courage to keep soldiering on in the face of these epic adversities is beyond me. Plus, now he's too hot!

In the course of the rest of the day, he gets reamed out at a meeting and does nothing to defend himself, eats a communal lunch with everyone else at the office and later claims that the lunch made him ill (not the beers or the sushi, or the brushing teeth with tapwater, but the lunch that no one else is complaining about), gets mad because the office won't reimburse his expenses without receipts, and turns his phone off for two hours, mightily pissing off a donor that wants to give his agency $4 million.

He also has nothing but scorn for local government officials. Check this part:

1.45 pm. We’re sitting on a sunken brown couch in a hallway in some minor government administration building. It has no springs left and is the sort of thing that my buddies might put in their basement den after finding it at a yard sale, cover with an old bedsheet, and drink beer while watching the hockey. In front of us, men in suits are striding up and down the corridors trying to look important, their footfalls echoing between the bare walls. Cheap wooden doors have brass nameplates on them. There’s no air-conditioning and the place smells vaguely of detergent and cigarette smoke.

1.55 pm. The Humanitarian Coordinator knows we’re out here. We know he’s in there. We know he’s in there alone, and that he’s not doing anything useful, except maybe putting some purple ink-stamps on various pieces of superfluous paperwork so that he can justify drawing a salary in the name of frustrating the international community’s efforts to help his people. But he’s going to keep us sitting out here for, ooh, another five minutes I reckon. Just because he can.

Busted furniture, "cheap" doors, the employees are "trying to look important" and the official they came to see is "not doing anything useful" which our hero can divine right through the closed door (it must be very flimsy indeed). The evil local guy is apparently actually trying to hurt his own people by "frustrating" the westerners with his bad sofa and no air conditioning.

I can just imagine the local official telling the purchasing department. "no don't give me any of that designer furniture or aircon units. Let's make it real nasty up in here so we can frustrate the bejeesus out of those damn do-gooder westerners.

This guy is just the worst. His post should have been titled "how not to be an aid worker".

Standing on shaky ground

Well, I have picked up one ally in the "don't take the deal" battle. Ladies and Gentleman, I give you....uh, Karl Rove???

"Thus, in backroom negotiations recently, the administration offered roughly $1 trillion in phony savings—mostly money that would never have been spent in Iraq and Afghanistan over the next 10 years anyway, along with $500 billion in interest savings on the trillion. It has also offered another supposed trillion in domestic and entitlement savings, but with cuts starting in 2014 and unlikely ever to be realized.

If the administration's spending cuts are mostly fake, its desire for tax increases is not. While the proposals are constantly shifting, you can be sure the president is looking to grab big chunks of cash from lots of people (and small businesses) who make less than a million a year."

Right on, brother Karl!

I'll say it again people. Phony cuts and deferred cuts in exchange for immediate real tax increases is not a deal worth having.

Score one for the wombats, eh Tyler?

Iz our children learning?

No George, but our teachers are cheating and that's almost the same thing, innit?

"Award-winning gains by Atlanta students were based on widespread cheating by 178 named teachers and principals, said Georgia Gov. Nathan Deal on Tuesday. His office released a report from the Georgia Bureau of Investigation that names 178 teachers and principals – 82 of whom confessed – in what's likely the biggest cheating scandal in US history.

This appears to be the largest of dozens of major cheating scandals, unearthed across the country. The allegations point an ongoing problem for US education, which has developed an ever-increasing dependence on standardized tests.
The report on the Atlanta Public Schools, released Tuesday, indicates a "widespread" conspiracy by teachers, principals and administrators to fix answers on the Criterion-Referenced Competency Test (CRCT), punish whistle-blowers, and hide improprieties."

Sounds like a RICO case just waiting to be filed.

Don't take the Deal!

David Brooks, Tyler, & Megan all implore the Republicans to "take the deal", meaning to accept some tax increases in exchange for "trillions in spending cuts" as conditions for raising the debt ceiling.

I disagree.

But, Angus, those are smart people, smarter than you, what is your problem?

Thanks for asking.

Let's ignore the fact that our economy is still in a big mess with high unemployment and underwater homeowners and just look at the terms of the deal.

The "cuts" are over a 10 year window. People, we have seen this movie before. Presidents are elected for 4 years, House members for 2 years. Current decisions are non-binding on future politicians. The cuts are a joke.

The tax increases, I'll wager, will NOT be coming over a 10 year window.

All current politicians can credibly do is cut NOW. So Republicans, please: cut or get off the pot.

It will never happen, but what we actually should do is (1) raise the debt ceiling with no strings attached. (2) Cut, not raise taxes, (3) pray that our credit holds out long enough for the economy to get healthy. (4) when either the economy gets healthy or our credit runs out, then cut spending down to size.

lavish links

1. Noam Chomsky says "no mas"!

2. e is for easy.

3. "Colorism". (more here)

4. If NBA profits are falling, it's not because of rising player salaries.

Loud Penis

You did not know this.

And you did not even know that you did not know that.

But now you know.

(Nod to Tommy the Brit)

We Like to Watch

"Q: Will Transformers: Dark of the Moon serve any purpose for society? A: After watching Transformers: Dark of the Moon, even the most hardened of patriots will finally understand why the terrorists hate us...Q: Should I see Transformers: Dark of the Moon? A: Probably not, but you will anyway. And you will leave the theater a less intelligent human being, but you will also leave slightly happier." [Mike Ryan, Vanity Fair]


"One study, for example, found that children who had just finished playing
violent video games were more likely to fill in the blank letter in 'explo_e' with a 'd' (so that it reads 'explode') than with an 'r' ('explore')...The prevention of this phenomenon, which might have been anticipated with common sense, is not a compelling state interest." [Justice Scalia, majority opinion (footnote #7) in support of First Amendment protection for violent video games]

"Among the most popular 'casual' games (so called because they are quick and simple to play) are twisted, violent games with names like Beat Me Up, Bloody Day and Boneless Girl. Young people don’t need to rent or buy casual games. They are available on computers, tablets and cellphones — free. (California’s law wouldn’t have applied to these games, even if it had survived the court’s scrutiny, because they are not rented or sold.)" [Joel Bakan, NYT op-ed]

(I had never seen "Boneless Girl." WTF? I mean, WTFingF?)

(Nod to Kevin Lewis)

You say it's your birthday.....

This has got to be the best song ever with the words "4th of July" in it, and one of the best songs Dave Alvin ever wrote.

Norman Rockwell and Independence Day 2011

We have two sons. They are both alive and well. A lot of people have lost sons, or daughters, whom they will mourn today, and every day for the rest of their lives. Because our troops are fighting three wars, and doing a lot of other things they were asked to do.

The picture below captures, with a Norman Rockwell-like clarity of composition, a little of how most of us feel about the fallen. The casket contains the remains of 2nd Lt. James Cathey. The honor guard covered the casket with a flag, and prepared to meet the family on the tarmac. The passengers watched, letting Lt. Cathey get off the plane first. (Todd Heisler, photographer)

The night before the burial of her husband's body, Katherine Cathey refused to leave the casket, asking to sleep next to his body for the last time The Marines made a bed for her, tucking in the sheets below the flag. Before she fell asleep, she opened her laptop computer and played songs that reminded her of 'Cat,' and one of the Marines asked if she wanted them to continue standing watch as she slept. 'I think it would be kind of nice if you kept doing it,' she said. 'I think that's what he would have wanted'. (Todd Heisler, again)

(The pix are from 2006, but for some reason have been circulating as an email in the last weeks...Besides, for the family that's only five years. It is never going to be long enough ago. Thanks to AB for sending this to me).

Russ and John talk about FotC Video on CSPAN

This is more than a month old, but some interesting stuff. For instance, I did not know that Eddie Murphy's brother Rich sang the refrain of the rap song. (The CSPAN show is an hour long. So it's probably only for real fans...)

A Tangled Web: Papiss, Pliss

Hey, who told you that you could use that sunscreen, kid!?

Camp comes down hard on unauthorized sunscreen users!!

“The camp is just doing what the state ordered them to do,” said Paul Basken, a father of two children who attend Barrie camp. “But this can’t be serious. I mean, if I didn’t feel safe about the camp, I just wouldn’t send my kids there.”

Oh, Paul: They are NOTHING if not serious. I just hope these same legislators and bureaucrats can soon be put in charge of whether or not I am "authorized" to take my aspirin. Show yoah papiss, pliss.

(Nod to the Anonywife)

Legalize it?

DSK Fail

Wow. There are two stories.

HE SAYS: The maid was in the room. He didn't know it. He walked out of the shower, all nekkid and pasty white 62 year old dough boy. The maid, seeing him, was overwhelmed by his physical beauty, and demanded that they couple, immediately, on the nearest available horizontal surface.

SHE SAYS: He came out of the shower, she didn't know he was in the room. She tried to ignore him. He pursued her, caught her, and raped her, in spite of her protests and resistance.

WHAT IS KNOWN FOR SURE: They were both in the room. Sex was had, because there is ... let's call it "DNA" ... from DSK. And it was all up in the part of the woman where "DNA" would be if they had sex.

THE VERDICT: These are two implausible stories. His is just silly. But it turns out that the maid has a history of lying and associating with very sketchy characters. Since both stories are implausible, we look to the presumption. In a criminal case, the strong presumption is innocence on the part of the accused.

DUKE LACROSSE: Not even close. There, no sex was had. Except with six other (non-lacrosse, non-Duke) guys, before and after. (EWWWWW!) But there was never any evidence that any of the students had sex with CM. None. Zero. In the DSK case, he DEFINITELY DID have sex with the woman, according to his own story and the DNA evidence. The question is whether it was consensual. Sounds like DSK walks.

STILL: The lacrosse players at Duke were innocent. DSK is "not guilty." There's a big difference.

I got your evil empire right here, bud.

Closer to home, Hugo Chavez and his Axis of Anklebiters are descending towards farce. The economic success of Chile and Brazil cuts the ground out from under the "Bolivarean" caudillos. They may strut and prance on the stage, appear with Fidel on TV and draw a crowd by attacking the Yanquis, but the dream of uniting South America into a great anticapitalist, anti-U.S. bloc is as dead as Che Guevara

--Walter Russell

Duke Lacrosse Redux?

Wow!

According to the NY Times, the criminal case against DSK may be falling apart over "major holes in the credibility of the housekeeper who charged that he attacked her in his Manhattan hotel suite in May"

"Prosecutors now do not believe much of what the accuser has told them about the circumstances or about herself."

"Mr. Strauss-Kahn could be released on his own recognizance, and freed from house arrest, reflecting the likelihood that the serious charges against him will not be sustained."

If this is true, it's really horrible. Though at least prosecuters in NY are not trying to pull a Nifong.

Better than having a shoe thrown at you....

N. Sarkozy gets grabbed by some random idiot.


There is a silly myth, in the U.S. at least, that French troops / police are cowards. The fact is that the French upper level officer corps was corrupt and cowardly, for a few decades of the previous century. But if you try to mess with any enlisted level French troops, or elite police unit, this will be a cause of considerable regret to you. They are fearless and brutal. The grab-man may be in for a difficult hour or so.

Nod to Anonyman

Amorous in Amarillo

more info is here.

Hat tip to RKG!

The Broken Window Fallacy

The Whitest Man on Earth talks about the Broken Window Fallacy.


The Bastiat text being referred to is here....

How's this for a new TV show idea:

Monty & the Tuna:

The old lefthander, rounding third and heading for home....

big Red machine, baby!

Born That Way

An old country preacher had a teenage son, and it was getting time the boy should give some thought to choosing a profession. Like many young Men his age, the boy didn't really know what he wanted to do, and he didn't seem too concerned about it. One day, while the boy was away at school, his father decided to try an experiment. He went into the boy's room and placed on his study table four objects.

1. A Bible.....
2. A silver dollar.....
3. A bottle of whiskey.....
4. And a Playboy magazine.....

"I'll just hide behind the door," the old preacher said to himself. "When he comes home from school today, I'll see which object he picks up. If it's the Bible, he's going to be a preacher like me, and what a blessing that would be!

If he picks up the dollar, he's going to be a business man, and that would be okay, too. But if he picks up the bottle, he's going to be a no-good drunken bum, and Lord, what a shame that would be.

And worst of all if he picks up that magazine he's going to be a skirt-chasing womanizer."

The old man waited anxiously, and soon heard his son's foot-steps as he entered the house whistling and headed for his room..

The boy tossed his books on the bed, and as he turned to leave the room he spotted the objects on the table...With curiosity in his eye, he walked over to inspect them. Finally, he picked up the Bible and placed it under his arm. He picked up the silver dollar and dropped into his pocket. He uncorked the bottle and took a big drink, while he admired this month's centerfold.

"Lord ha' mercy, that's terrible." the old preacher disgustedly whispered. "He's gonna run for Congress."

(Nod to the LMM)

Calculation Debate

Markets on a (Computer) Chip? New Perspectives on Economic Calculation

Mark Jablonowski, Science & Society, July 2011, Pages 400-418

Abstract: Is it possible to implement an efficient economic alternative to market capitalism using economic planning? The debate, which has blown both hot and cold over the last 80 years, has turned on the feasibility of calculating solutions to what amounts to a vast quantity of economic equations. More recently, issues of respecting the uncertainty and preserving the information content inherent in "real world" economic transactions have surfaced. The question may ultimately be decided not on how much computing power is needed to solve complex economic problems, but rather on how well new solutions are articulated. New developments in computer "chip level" computation, including the rebirth of electronic analogs and the incor-poration of the fuzzy set formalism for computing in complex systems, may impart a greater feasibility to the idea of deliberate public planning that integrates the benefits of the market process for the achievement of social objectives. These developments have implications for establishing workable alternatives to capitalism.

(Nod to Kevin Lewis)

Delta Dawn, What's That Airplane I Got On?

A remarkably bad experience with Delta.

As background, I am a Gold Medallion member. That means I get treated better than the average flyer, by a fair amount. Not saying I deserve it, just saying that if this happened to me, with GM status, then the little people get...yikes!

Get to Memphis, on a Salt Lake to Raleigh trip, for layover. Plane supposed to leave at 7:05. Go to gate. Told gate is changed, flight is now 8:05.

Go to new gate. Told gate is changed, different terminal. Flight is now 8:40.

All facilities, and I mean ALL facilities, except bathrooms, close at 7:30. No way to buy anything to drink or eat. Not even vending machines. I've never seen anything like it. The airport was full of people, but every service facility, drinks food, news stores, everything: locked up. People were still in line, and the "service" folks were pulling the metal cage doors shut.

New gate announcement: other end of terminal. Flight is now 9:05. We all walk over. Arrive at gate, told that was a mistake. Wait, maybe it was NOT a mistake. Yes, a mistake. Go back to gate next to gate where we just were all sitting.

Announcement at new/old gate: "The flight is now expected to depart at 10:21 pm. That is a rough estimate, though." Bitter laughter. The mood is growing ugly.

Plane arrives, passengers deplane. Immediately, gate person says, "Now boarding, all rows, all passengers!" Now, one reason I value Gold Medallion status is that I get to board first. I have an LCD projector that is large and very fragile, and I need a minute to get it settled into the overhead. It will be damaged if I have to put it underfoot, and they are supposed to give zone 1 passengers an extra minute or two. But, not this time. By the time I get to my seat, there is no overhead space. I have to push the projector under the seat. Hear cracking sounds. Worried about it, but no choice. Keep pushing.

Stewardess gets on intercom, explains delay. Turns out that this plane (Delta #4271, Lubbock, TX to Memphis, TN to Raleigh, NC) had been stuck in Lubbock for 3.5 hours because...it was TOO HOT. Turns out that this plane cannot be operated in hot places like Lubbock, TX. Which led me to want to ask, "Why the $^%$#$ did you have this plane in Lubbock scheduled for a late afternoon take-off!? It is always hot in Lubbock in late June!" (To be fair, it hit 110 degrees F in Lubbock on Sunday. That's warm...)

Stewardess goes on to tell us the following happy news:

1. Our arrival into RDU would be 1:15 am (scheduled arrival: 10:05 pm)
2. Because they had had to pull the sweaty passengers off the plane three times in Lubbock (once after the cabin filled with smoke!), and the passengers had spent nearly six hours on the plane, the plane was trashed. But....there was no crew on hand to clean the plane. (Everyone who works for Delta in Memphis goes home at 7:30 pm, see above). So, though there was trash and stickyness everywhere....we should just go screw ourselves. Fly or don't.
3. There was also no crew to provision the plane. So, no drinks or snacks. She implied we were lucky to be flying at all, given the heroic efforts of the flight crew to fly a plane that was not really allowed to fly out of hot Lubbock in the first place...you maggots should be GRATEFUL!

Got home, at 1:15 am. And you know what? She was RIGHT. I was very grateful... that I did not have to fly on Delta any more for a while.

An Economy Produces Goods for Consumers, Not "Jobs"

From my talk today at the Locke Foundation. (Big props to my man, Mitch Kokai)



UPDATE: And here is the entire talk, 40 minutes worth, if you are a streamer.

.

He Jumped the Surfer

So, "he jumped the shark" means to go way, WAY too far in the direction of doing something stupid, for a show or activity that has long outlived its "dispose by" date.

Well...this shark jumped the surfer. Yes, he did, in this very video.

And since a lot of people have never heard of the Happy Days origin of the phrase "jumped the shark," I give you: Fonzie.

Libertarians Rising?

Article about libertarian identification rising.

Article about comments on article about libertarian identification rising.

(Nod to Erik C and Anonyman)

Magic Fed dust

"There is still a sufficiently low real interest rate that would produce recovery, but it’s a rate that’s hard to achieve."

--Paul Krugman

The accuracy of this quote depends on the definition of the word "hard" (sorry to go all Bill Clinton on you people).

Despite all the recent talk of unconventional monetary policy, the Fed really only has one bullet, manipulating bank reserves. They can shoot that bullet at the nominal interest rate, or at the inflation rate, but not at both.

Suppose the real interest rate required to "produce recovery" was -10%. There is no way the Fed can both hold the nominal rate near zero and create 10% inflation. They might be able to hit -10% fleetingly at a positive and rising nominal rate with a rapidly accelerating inflation rate, but we have seen in the 1970s that such conditions are not conducive to growth.

The Fed simply can't produce stable negative rates on financial instruments relevant for investment or financing consumer durables.

So if "hard" means "impossible to pull off in any sort of constructive way", then I agree with the quote.

All your jets are belong to us

I am not an airplane snob. I've flown Rwanda Air Express, MadAir (the national airline of Madagascar), along with bush planes in Guatemala, Mexico, Tanzania, Costa Rica, and Peru (when our charter pilot in Peru went out of business between our outbound and inbound flight we got a ride from the Peruvian air force!).

But this is a bit too much (from the Economist):

"Running Air Zimbabwe is not easy. When President Robert Mugabe wants to go somewhere, he simply kicks the passengers off one of your jets and takes it. This is not good for customer relations, or profits."

Maybe Air Zim could join up with Delta & KLM!

NYT and Bubbles

I was pleased to see that the NYT actually had reverted, if briefly, to being a newspaper instead of a hack mouthpiece for the Obama regime.

They had this very plausible story about the "green energy bubble." And it's true: many of the companies that were recently photo ops for some grinning Obama regime rep (including Mr. Obama himself) have gone belly up. They only were created to suck down subsidies from idiots. A classic bubble. The Green she go boom. Pop go a bunch of weasels.

But then I looked more closely. Far from focusing on the actual bubble, the one in green energy, the one that has already burst, the Green Lady of News is actually forecasting a bubble in...natural gas. The discovery of enormous new reserves of cheap, clean-burning fuel is very annoying to the Green Energy Gods, the apparatchiks of the regime who want to use public money to pay off their pals. And for the "peak idiocy" bunch....fugeddaboudit. Natural gas is a disaster for the authoritarians who want us all to return to sad stone age lives perched in caves and contemplating the sins of "late" capitalism.

Amazing. Just when you think the NYTimes can't sink any lower, they submerge into the muck.

(Nod to the Blonde)

7 million new jobs in 7 paragraphs

Man Robert Frank is ON FIRE in his Economic View column. The whole thing is 16 paragraphs, but in grafs 6-12 Bob lays out how we can get "more than 7 million" new jobs by the end of 2012.

I can boil his 7 grafs into 3 words:

payroll tax holiday

Yessirree Bob; it's just that easy. Cut the employee rate to zero and cut the employer's rate to zero for all new hires from now to the end of 2012.

I am in favor of cutting the payroll tax permanently, not just for 18 months, or so regardless of how many jobs it creates, but I am amazed that (a) Bob Frank is advocating this policy, and (b) that he is so sure that the resulting employment gains would be so strong.