08.28.07

SCHIP - Another Point of View

Posted in Uncategorized at 9:26 am by steve

I usually agree with Krugman. For instance, I believe that all children should have health insurance. Here Krugman calls the President’s position on SCHIP immoral. And I think that is a reasonable argument to make. Here Krugman argues that the reason for providing children with health insurance mirrors the reasoning behind public education.

The truth is that there’s no difference in principle between saying that every American child is entitled to an education and saying that every American child is entitled to adequate health care. It’s just a matter of historical accident that we think of access to free K-12 education as a basic right, but consider having the government pay children’s medical bills “welfare,” with all the negative connotations that go with that term.

I agree with him that the argument for health care parallels the argument for education. And I agree with him that children ought to be covered. But I am not sure that I agree with Krugman about the reasoning for each.

His reasoning - or at least the reasoning he cites - is on the basis of rights. And that reasoning only takes the argument so far. It is easy to argue that a child has a right to be satisfactorily educated even when his parents object and wish to use the child instead as free labor “down on the farm.” In this case, mandatory public education does protect the rights of the child. And it enforces the rights of society to an educated populace over the rights of parents to enjoy the benefits of child labor. In other words, mandatory education is one very powerful place to interrupt the societal “race to the bottom.”

This example also illustrates that what one gives up by living in a “free society” is the right to live an uninformed life, securely ensconsed in safety of and securely bound by the chains of unexamined fundamentalist belief. That’s the purpose of education, to break those chains. It is not just to make us fit to be good insurance and car salesmen. It exists to make us virtuous people, to be equipped to make sound moral choices. As much as I would like to believe otherwise, public education is a right to a particular child not because it is a fundamental right of man; but because the ability to take that right away imperils the institutions of democracy and meritocracy. Rights arguments do not take us the full distance in the argument for public education.

In the case of public education, I benefit when all children can read, write, and reason about liberty and ethical behavior. I gain benefits from public education even if I have no children; even if I never was one myself. We educate others in order that our society might work better. Public education is designed to help support and propagate democracy just as it is to make us productive and compliant little industrial workers. Public education, while it serves the private good of the individual and the private goods of commercial enterprise, exists and is publicly funded because of the public goods it produces. In fact, education in England began in support of the goal of producing an enlightened ruling class and an effective civil service. The goods of education, then, improve society at every level; commercially, socially, and aesthetically. It is to achieve these ends that we educate. And it is to protect against the “race to the bottom” that we make such education mandatory.

Krugman is right that we must judge health care using parallel arguments. I would suggest, again, that we do it in terms of enlightened self-interest rather than in terms of rights.

In the area of infectious disease, one person’s malady is potentially mine as well. Thus, I have an interest in protecting everyone else from infectious disease, lest I fall ill from the same disease. In the age of the antibiotic we forget how powerfully important this effect is. But it explains why we have public water works and sewers. That advance itself added about twenty years to life expectancy in the west. Public health, then, is not an individual affair. It is a shared social experience. In this sense, health care and education are directly comparable.

But the argument goes further. The burdens to society of a system that perpetuates an uncared-for underclass raises social tensions and causes other ills that are much more costly to fix. And in a profound way we have a very broken version of this already: no emergency room can legally turn away people for inability to pay. What this means is that people with conditions that may easily and cheaply be controlled wait to seek treatment until those conditions become life-threatening. They then go to the emergency room. The cost of treatment then is many times higher. Or a disease that nead not be mortal proves to be so. That does not say much for how we view the sanctity of life.

In the case of antibiotic-resistant tuberculosis, it can cost hundreds of times as much for emergent care and recovery as it does for the standard course of antibiotics. So by not insuring the indigent to the point where they can afford such treatments we can simultaneously spend much more and get worse results. What possible argument is there that we should not insure? The only reasonable argument is that it is more lucrative to the entities that sell to hospitals to create the current situation. So long as only those entities matter in the discourse about public health, we shall hew to the current course.

In this view of things, it is enlightened self interest that provides the most satisfying answer. While I happen to imagine that some aspects of health care ought to be viewed as fundamental rights, I am aware of two problems. One is getting broad agreement that health care is a fundamental right. I just don’ t think it can happen. Americans have always been a stubbornly independent and self-interested lot. It is only appeals to self interest that will ultimately bring change where it is needed. And there are plenty of self-interest arguments for publicly funded health care.

But more troubling is the worry that if we argue that health care is a right, then there is the corresponding argument that the government has an interest not just in supporting my health, but in controlling it. If we have a right to claim from the government any and all health care, it must have a right to demand from us behaviors we may not be prepared to comply with. I like tofu and oat bran; but I can eat only so much of it. Sometimes I want pizza. What happens when it tells me I cannot have pizza?

My guess is that a lot more people will agree with Krugman that children ought to have health care coverage, so long as they believe it does not presage a day when they themselves have to choose between consuming steak or chocolate or diet soda and having health insurance. And I think that is a reasonable fear. For this reason, I think it matters why we would advocate for SCHIP.

Health failures among students lead to other kinds of failures: failures in education, failures in the workplace, failures in society. And each of these can be many times more costly than the cost of avoiding the problem. But sensible interventions save money and make everyone happier. We can do it because it’s the right thing to do. We can do it because it’s how we would want to be treated. We can do it because we, too are better off for doing it.


08.18.07

Killer Robots

Posted in Social at 6:47 pm by steve

Six years ago there was a popular show whose name I cannot remember. It was a contest in which mechanical robots fought each other to the death. And its commercial sponsor was the US Army. It did not take much imagination to figure out why. If one assumed that robots were less expensive to deploy than humans in phyical conflict, the future of hand-to-hand combat was in the hands of the robot. A show that featured combat between robots would highlight the kinds of technical issues involved and the kind of strategic / game theoretical issues involved in such combat.

It was easy to guess at what the Army was planning; but it was difficult know how its plans would be implemented. Today, however, we have a better idea. Jorg Blech at Der Spiegel discusses the Army’s plans and shows us photos of a new battle robot that the US Army purchases for $150,000.

It all pretty much makes sense. The robot is configured like a tank. It travels on dual tracks and has a swivelling turret that houses its five cameras including night vision cameras. It totes major fire power and lots of ammo. And it is much less costly to operate in the field. Presumably that low cost takes into account that it is operated by a real live person sitting at a computer.

So one still has to pay a person to act as a robot controller. But presumably one does not have to pay them quite so much because they act as soldiers by essentially acting as if they are in a video game. A really convenient thing about this for the army is that they can create simulation games that indicate which recruits have promise. Another is that it saves a fortune in deployment and medical expenses.

Everything about it makes sense.

But having a dedicated operator for each killer robot is expensive. The army worries that it simply makes killing too expensive. So they are working on advanced robots that know who to kill. “.. there are no scientific barriers standing in the way of autonomous combat robots,” says Ronald Arkin of the Atlanta-based Georgia Institute of Technology. “The parts of the whole are being assembled as we speak.”

Arkin is working on code that will limit the behavior of robots and make them behave “ethically.” In theory, this would mean that a robot could disobey orders that contradicted an ingrained ethical code. This is nice in theory. If such code is used in human-operated robots it would mean that two people would have to agree each time the robot fires at a target. One would be the robot’s operator. The other would be the designer of its software conscience. This strategy has a number of advantages. One of them is that people will not get shot simply out of cruelty or malice. Another is that there will be no ‘psychological toll’ that accumulates from the act of killing. The robots will be able to kill and keep killing.

So far, so good. But once we get to this point the great cost of killing people using robots suddenly becomes the cost of their operators. And the Pentagon is already trying to determine how to make robots that shoot without the help of an operator. Technologically, this is almost no different from the former case. The actual “decision” to shoot is made in real time by computer code. This has quite a number of advantages. And it is almost trivially easy if one can drop a killer robot into a place where every single human body is a legitimate target. And if all legitimate targets are wearing a particular kind of uniform or have a particular set of physical features, things might be easy.

But not all targeting environments are quite so simple. In any situations where there is ambiguity and a trained soldier would have to make a difficult decision, it is hard to imagine that a killer robot could be more reliable. The targeting logic quickly becomes extremely difficult. Take a situation like Vietnam or Iraq in which ‘civilians’ may have guns or other weapons. There is almost not robust way to describe whether a person is a legitimate target. Trained soldeiers get it wrong all the time; so distilling the correct logic into code is almost a hopeless task. It may help if all the targets were to wear similar uniforms. But in the US civilians wear fatigues. And in many places in the mideast and in southeast asia it is not impossible for women or children to bear arms or explosives. But as a general rule one would not wish to target women or children.

The one sure way of winning every battle and losing every war is to target women and children. So, is it possible to make a robot that is capable of never shooting unarmed women or children? Or unarmed men, for that matter? Or of only shooting people when they clearly represent a danger? This is actually requiring of a robot skills humans are quite imperfect at exercising.

It is reasonable to be skeptical that robots might get to this level of performance. Think about the home computer: how often does it do something quite unexpected, something counterproductive or even mildly destructive. Now, imagine a completely new and untested computer toting automatic weapons. Given the level of reliability of computer systems that have evolved through hundreds of billions or perhaps trillions of hours of operator usage, what can we expect of computer software controlling robots. That it will be imperfect.

But even if we were to assume it is “just a matter of time” before all the design flaws are worked out, there is a darker side. How does one know that the robot will behave in a manner that is consistent with our ideals about vitrue, honor and good judgment? How does one know that the robot will only shoot who it ought to shoot, but never who it ought not to shoot? Aside from the technical issues of making complex judgments about its own physical context and its societal role in that context, how does one know by looking at a robot whether it is running the right code?

There are, of course, lots of ways one can load the robot with safeguards. For instance, one would expect some sort of keyed hardware switch that would always be off except when the robot is physically deployed for battle. And one would expect that it would only be loaded with ammunition just before it is deployed. A robust design would require a third party, one distant from the robot to enable loading or discharge of the weapon. This would make it impossible for the robot to hurt people outside of its designated theater of deployment.

Then, within its defined theater of deployment one could give it an RFID sensor that is hardwired to prevent it from shooting at designated RFID targets. Soldiers within the theater of deployment would be equipped with RFID devices that identify them as non-targets. RFID would be a convenient way to prevent a lot of deaths by friendly fire.

The notion of deploying such robotic weapons in a war theater has a number of difficulties like this. But one of the constants in such an equation is that there is a general geographic separation between legitimate targets and illegitimate ones. In such a context it is possible to conceive of targeting strategies that are robust under almost any conditions.

There is, unfortunately, an increasing tendency at the federal level to confuse security with military action. And when one becomes even the slightest bit confused about these, one begins using military tactics and devices on civilians. One consequence can be the use of killer robots within the bounds of the United States to shoot at US citizens.

Once one starts down this path, things get ugly quickly. One difficulty is the issue of anonymity. Each robot might look like every other. Human targets and onloookers will not be able to distinguish one from a zillion other almost identical models. So if an operator of a robot turns one on a civilian with whom he has a grudge, it would be impossible to know who did it unless the robotic sensor information were archived and reviewed. In such a case, military officials would have to cooperate with local law enforcement officials to solve the crime.

Even more frightening, however, is the possibility of using such robots to go after political dissenters. Robots could be assigned to “security details” at shopping malls, grocery stores, and workplace parking lots and garages. There, they would shoot people who pose political threats. And the shootings would be officially judged “accidental.” They would be pronounced the “cost of security.”

It would be quite convenient to the parties who controlled the robots. At first, we presume that they would be conrolled by the military, but if the current trend of privatization continues, killer robots could be property of “Backwater” or some other cutting edge military contractor. And when the military has no use for them, they could be rented out to private entities. It would just be a matter of time before killer robots worked as hit men for those who could gain control of them. And there is some possibility that they could successfully carry out murderous missions while retaining anonymity of the controlling party.

ASince nobody could interview the robots and since the people who gave them their targeting information would naturally be protected under the “state secrets” principle there would be almost no practical limit to the amount of carnage the robots would be able to create in the name of “security.”

As grizzly as this scenario is, it assumes that the robots have perfect judgment; that they only kill targets made legitimate by some governmental authority or agent. But this is necessarily untrue. Any robot that is capable of choosing its own target on the basis of physical characteristics, geography, and other contextual clues must necessarily be capable of error. In a practical sense this may turn out to be a small chance. It may, in fact, turn out to be smaller than the propensity for error of a good police officer. But it is likely that the only way it will get to be that good is if it starts out worse.

It is also theoretically possible that people with extremely good ethical judgment and ones with extremely good technical skills manage to imbue military robots with a powerful sense of ethical behavior. And it may be possible to engineer those robots in such a way that this is very difficult to overcome. But if military robots ever become ubiquitous, there is no question that some of them will be hacked. Some will end up with compromised ethical systems. Some will be deployed for nefarious purposes.

Now is the time to ask ourselves how many Americans will be killed by rogue military robots before we implement laws that regulate with great specificity how they may be deployed. Now is also the time to implement such law, long before military rogues start using killer robots for nefarious purposes.

My bet is almost everyone in the military will tell you that none of this could ever happen. Almost noone can imagine it happening - not because it is technically infeasible, but because it is unthinkable. But it is not these people that we worry about. It is the few who enter the armed forces not out of a sense of duty to country but out of a lust for power. Every army has them. It is these who could create havoc with just a small collection of robots.

The guys who work on the robots would know all the tricks. They would know the behavior of the code. They would have ideas for how to hack the code. They would be capable of making subtle hardware modifications that simply nullify the ethical checks or other safety interlocks. There is a sense in which these guys hold ultimate power over the behavior of the killer robots, at least on a small scale. As an engineer who has worked on dangerous systems, I know that with any dangerous system there is a kind of ultimate trust that one places in the people entrusted with its physical care and maintenance.

Given both access and the right kind of knowledge it might be easy to gain control of a warehouse full of killer robots. If the software is designed badly or if the control is implemented haphazardly, it might be easy to override control by inserting code to do what one wished and overriding ethical codes. Unless the operating code was audited frequently and on an arbitrary schedule by a third party, one might be able to use a software patch to gain control of a whole battalion of robots overnight. Or if some simple mechanical modification were required, a mechanic might be able to modify s dozen bots per night for a year.

What would happen, I wonder, if two or three thousand killer robots were released on Washington or New York by a small band of military rogues? A few hundred thousand fatalities would not be out of the question.

There is a sense in which there is no meaningful distinction between this concern and the concern that humans ultimately control nuclear weapons, as well. And if one were to approach the design and implementation of the safety systems of these robots with the same attention to detail that accommodated the nuclear weapons program, there is a good chance that the robots would be well behaved.

How does one address such issues? One simple method might be to make it illegal to physically arm robots within the boundaries of the US except within a single, small, fixed designated testing area. Another would be to require each robot to bear distinctive identification. A third would be that they are not allowed outside military installations except for being transported to foreign theaters of combat. A fourth is to have a very rigorous auditing program by a party that does not belong to the executive branch of the government. A fifth might be to have the ethics program embedded in ROM and interlocked so that “Patches” cannot overwrite any part of the ethical code. When the ethical module is compromised in any way, the arms cannot be deployed. There are a host of provisions that one might make if one were concerned about the abuse of killer robots by the US military. But the only hope of sorting them out is to discuss them broadly. Most of the questions are not engineering questions. Most of the questions deal with auditing and control.

Now is the time we need to be having the public discussion about the rules of design and deployment for killer robots. The design choices are not all simply technical choices for the military. The design of the devices and the design of the programs ( computer and logistical, both) that control them must be audited and must comply with civilian concerns about potential abuses. Once killer robots are ubiquitous and are busy “keeping us safe” on every street corner it may be too late.


08.17.07

Style or Substance - Which Torpedoed the Dubya Regime?

Posted in Social at 9:20 pm by steve

It’s certainly too early to do a post-mortem on the Dubya presidency. Sure, Rumsfeld and Rove are gone. Scooter Libby and John Ashcroft are gone. Tony Snow is promising to leave soon. Condi has been marginalized almost to the point of extinction. A number of DOJ officials have left. And Gonzo is under fire.

Most people who quit the White House discover that their tour of duty has ruined them for other work. This makes recruitment of qualified replacements ever more difficult. But perhaps this has never been an impediment to the Dubya administration.

The unravelling of the administration raises a serious question about leadership. One rightly ought to ask what caused the demise of the Bush administration: to what extent was it caused by bad policy decisions, to what extent was it caused by flawed leadership style, and to what extent are these two issues separable.

That the Dubya administration was different was clear from early on. the administration controlled information with an iron fist. Convinced that in political discourse there were no facts, only stories, it worked to create the stories, the mythos that supported its own world view. And people bought it.

Dubya’s style was dictatorial. He alone, and his boss Dick, were the only ones who could see all the cards. They were the only ones who knew what was going on. And why. And they controlled all the stories and arguments for why things were the way they were.

A microcosm of this was the Iraq war thing. Among Dubya, Dick, and Rummy, there never was any question of whether to invade Iraq. The only questions were when and “how?” Conveniently, the twin towers incident gave them the excuse. Roughly speaking, the argument used by the administration was “Moslem people from the mideast attacked us. Iraq is a mideast country full of moslem people. Therefore we shall attack Iraq.” This is the flawed syllogism that equates to “fighting them over there so we don’t have to fight them here.” And to make the argument compelling they created some bogus stories about “weapons of mass destruction.”

Any person who has had a freshman course in logic knows that the syllogism they used is flawed. Yet that fallacious argument evidently fooled everyone in the M$M into supporting the invasion. Anyone who followed the inspection process knew that the premise of WMD was seriously flawed. The source who claimed it so was both known to be unreliable and had a financial interest in a regime change in Iraq. The administration did not care. They didn’t want a factual argument for an invasion; they wanted a believable and affirmative one. Fact was not relevant. Congress followed slavishly.

By just about any measure, the occupation of Iraq has not gone well. It is the great policy failure by which the Dubya administration is measured. And success and failure of military campaigns has always figured prominantly in history, Dubya will be assessed on Iraq.

In the case of Iraq, then, was Dubya’s failure due to management style or is it due to policy? In this case it is difficult to make a distinction. For it was a kind of deliberate blindness to facts, a deliberate attempt to defy fact and to invent fact-independent “truth” that led to the debacle. Policy was informed by style. Were Dubya the kind of person who could be persuaded by facts and arguments, the Iraq policy would likely have been quite different. Policy and style in Dubya’s case are intextricably linked. This can be seen best by looking at what the administration has achieved while everyone was looking the other way.

Duya’s most profound effects have been in how he has attempted to redefine the presidency. If one looks for unifying themes in the Dubya presidency, one finds the neverending war in Iraq to be:
1) an excuse for “emergency” powers: suspension of Constitutional rights, open disregard for rule of law, and so on.
2) a distraction to keep press from talking about what the administration is really doing.

In other words, one could make an argument that the war in Iraq may have never had anything to do with Iraq. To Dubya and to those who were most interested in expanding the power of the presidency, the war in Iraq was about grabbing power here in the US. There was never any foreign policy component to it.*

If we view the Dubya administration in this sense, once again style and policy are inextricable. The style is that of a tyrant establishing a tyranny built by subverting existing structures. And the policy is in support of that.

This is a very sketchy view of the argument; but the body of fact with which it is consistent is huge. The attempt to place a judicial branch within the executive, the attempt to permanently suspend habeus corpus, the attempt to legislate unilaterally using signing statements, the insistence on a “unitary executive,” the hidden provisions in the Patriot Act that rescind powers of assent from the Legislature and powers of Judicial oversight from the Judiciary, all these are clear signs of a presidency obsessed with elimination of Constitutional law.

For a president to be so brazen in his attempt to overthrow the system suggests a kind of hubris that is quite remarkable. Or it suggests a state of corruption of the system that is significantly more profound than we could have imagined. Either way, the policy and practice of grabbing power by subverting one institution after another is completely supported by methods of secrecy, deceipt, and distraction.

What is truly scary is that it’s not over. And those of us who have studied certain bits of history have reason to believe that while Dubya’s dad and his sons are alive, free, and in communication with their associates it cannot get completely better. Nor can it do so as long as the neocons have a prominent voice in public policy.

Dubya, by some measure, is a neocon invention. But it is not Dubya the person, but Dubya the type. The whole neocon agenda is oriented toward an imperial presidency. It is oriented to puffing up executive power, to expanding the power and expense of the military, and to military conquest. Why? To answer the first part of question, think about how money flows. To answer the second, ask Hegel.

Dubya’s style is not much more than a necessary condition to realization of the whole neocon agenda. An open and communicative style a la Jimmy Carter was anathema to it. And that is why he was crucified by the press. Even then the American people were being prepared for an imperial presidency. Dubya is the first real incarnation of that.

If Americans don’t like what they see, they need to reject it ever more soundly and unequivocably. Not just the man; not just the regime, but the whole imperial ideal, the whole neocon agenda. Deny government its secrets and deceptions, deny the press its powers of distraction, and seek to live lives of virtue and meaning. Only when these have been accomplished can America be safe for democracy.


—-
* It’s a useful argument to make, for it illuminates one occult aspect of the war. On the other hand, it is probably true that the Iraq war had something to do with an extra trillion dollars in oil concessions, with inventing a private, contract military, with bilking taxpayers by exploiting military contracts, and perhaps even with a personal vendetta against Saddam.

Padilla Guilty

Posted in Social at 5:36 am by steve

After more than five long years of detainment, Jose Padilla has been tried. The verdict is in: Padilla was found guilty. There are two ways to interpret the outcome. For those who believe that al Qaeda is a terrorist organization whose sole purpose is to ruin our “way of life” using acts of violence, the trial demonstrates that the normal criminal justice system works. Lots of other people are arguing this. And there is a lot of merit to the argument.

But some of us have reservations.

The most troubling thing about the Padilla trial was how it unfolded as an attempt by the Bush Administration to create a new kind of justice system within the executive branch - one that violated every Constitutional ideal and principle. Padilla has been in solitary confinement, has been subject to torture, has been denied due process, and so on: this is old news.

Only a little less troubling, but much less talked about. is that it seems Padilla was convicted of choosing bad associates. Not only did the prosecution fail to show Padilla actually had criminal intent, they failed to show any evidence of it. They came mightly close to not even trying. Rather, what they showed was that he wanted to join al Qaeda.

Sadly, political leaders and the M$M have given us a very hazy picture of al Qaeda. At least half of what has been claimed of it is false; most statements contradict or conflict with other statements or require the suspension of known physical laws of the universe. To call it a terrorist organization might be materially less accurate than to call it an organized crime organization. Or an underground fundamentalist religious militia. Sort of like ones we find in some red States, only Moslem. What we do know about the organization is that it is dedicated to religious fundamentalism and that it uses organized crime methods to raise money - mostly learned from the US intelligence community. Sometimes, perhaps, it blows things up using tricks it learned from the Americans.

If being associated with a group whose members do criminal acts were always a crime, then a lot of people in the military deserve similar trials: Abu Ghraib saw the purposeful rape and sodomy of many innocent civilians and the humiliation of dozens or hundreds more. And Iraq has suffered more than a million deaths as a result of US invasion. Does that make every person who has applied to serve in the US military a war criminal? (That was meant as a rhetorical question, BTW.)

How can Padilla’s analogous acts of association be legitimately called illegal? The main piece of evidence offered by the prosecution was a three page application with seven of his finger prints. So Padilla wanted to join al Qaeda. But it’s not clear that the prosecution succeeded in demonstrating that he actually did join al Qaeda. Did he, for instance, receive their membership card complete with the forge-proof hologram of authentification? Did he receive paychecks? No? What precisely was the nature of the association? It matters. The M$M assumes we don’t care; therefore I don’t know. But this stuff matters.

Even if he did actually join and get membership cards and newsletters, and drink club soda with them at the annual picnics, in a normal world, the prosecution would have to demonstrate that Padilla intended to actually do harm. The prosecution would have to demonstrate that Padilla intended to engage in a criminal act. From what I can tell of the trial, it didn’t present any evidence to this effect. Rather, they relied on the perception that al Qaeda was a bad organization; that all it did was dangerous and illegal. But it did not offer evidence to that effect. Instead, it relied on the presumption that joining the organization was de facto proof of intent. This is a great leap of faith; and one that is unwarranted. If proof of membership were to be sufficient to prove intent, one would have to demonstrate that intent to harm was actually a requirement of joining the organization. But it wasn’t.

So Padilla was convicted of falling in with presumably bad company. This is a very dangerous precedent to set. For if it is allowed to stand, guilt by association becomes legitimized as a tool of government suppression. The President, invoking the Patriot Act, could declare any group a terrorist organization. Then, any person who interacts with them can be tried and convicted of giving them support. Thirty years ago it was unimaginable. Now the only reason we don’t anticipate it happening regularly is that it has only happened one time. Once is one time too many.

If we are to argue that in this case the system worked, we would have to argue that Padilla actually intended to do harm. And if there was any such evidence offered by the prosecution in this trial, I’ve not bumped into it. Yes, there was highly suspicious talk involving zucchini and eggplant. But Padilla did not engage in such talk. And sometimes a zucchini is just a zucchini.


A Million Dollar Screw

Posted in Uncategorized at 2:39 am by steve

How much does it cost to deliver two ninteen cent washers to an army base in Ft Bliss, Texas? It depends. If you are the Pentagon and you are using the South Carolina firm C&D Distributors, it might cost $998,798. For three screws going to Habbaniyah, Iraq, the billed rate was $455,009. All told, the company shipped $68,000 worth of parts and charged the Pentagon over $20 million.

How did they get away with it? They exploited a “no questions asked” feature of the Pentagon’s purchasing protocol. For expenses smaller than a certain threshold, payments were made automatically, without any oversight from any purchasing authority. An alert employee spotted the problem accidentally. It’s good to know that “wink wink” is not yet the standard response to such malfeasance.

Oh for the good old days of the $300 toilet seat. ( Story Here )


08.14.07

Goodbye Karl

Posted in Social at 6:59 pm by steve

It’s easy to dislike Karl Rove. But there was substance to his mad genius. Who else has managed to seat their client as president after losing an election? Twice.

In both 2000 and 2004 Rove identified the battleground states and took action. It was Florida in 2000. The trick was to disenfranchise 50,000 black voters by calling them felons. It almost worked. But not quite. What actually was required was to stop counting while Bush was ahead. And for that, help from the Supreme Court was required.

In 2004 the strategy was remarkably more robust and complex. In Ohio there were stories about a wide range of problems. They included a deliberate paucity of machines in predominantly Democratic precincts in order to create long lines and delays. They included a number of instances of registration malfeasance.

These efforts helped make the race appear closer than it actually was. But in order to assure that the election actually went to Dubya, the trick was for the Republican Party to control the tallying of the votes. In Ohio, Secretary of State Ken Blackwell evidently entrusted the tallying of the votes to the same company that hosts Karl Rove’s special political email acount. And the original source documents have since gone missing, in violation of federal election law. It may be impossible to prove that Rove stole the 2004 election, but his fingerprints are all over the scene of the crime.

It is ironic, Dubya Rove and company have done what Grover Nordquist never could have hoped for: they have proven that federal government is easy to manipulate by a criminal class of parasites. Americans are too easily corrupted by money. A whole wing of the Republican party was arrayed to exploit the simple fact that Americans paid taxes: not by providing needed services as would occur in a nominally corrupt government, but by inventing useless and counterproductive ones simply to get special contracts.

Dubya Rove & Co defined the evil axis in America that aligns the media with the parasite class, demanding ever more money for defense and similar programs that arguably add no marginal value. These probrams are not justified entirely on the whim, rather they are justified on the basis of manufactured threats. And the argument for responding has less to do with forestalling danger than it has to do with doing something that simply feels good: It makes America’s forces bigger, stronger, more potent.

Bigger, stiffer, stronger, more potent. That’s what all the emails promise. That’s what the neocons promise. That’s what Dubya Rove & Co. promised. To the French, such a condition in the male of a species leads to “le petit mort.” But with the help of modern pharmaceuticals, more than one person has been rendered completely dead from too much standing erect. The Dubya Rove & Co. method of stimulating the body politic may seem pleasing in the short run; but it is not sustainable indefinitely. The heart gives out. When the actor is the body politic, the casualty will be democracy itself.

Plato predicted days like this. And the framers of the Constitution feared them. But even their inevitability does not render irrelevant the actors who play the parts. They get a special place in history. If Dubya Rove & Co. earns a notable place in history, it will be because the institution is able to claim “We fucked democracy to death.”


08.10.07

Note to Harry and Nancy

Posted in Social at 8:08 pm by steve

Fourteen percent. That’s one person in seven. One person in seven believes Congress is doing a good job. It’s never been lower. Why so low? One might argue that it’s anyone’s guess. But my guess is that it has to do with the Bush agenda. What is the Bush agenda?

  1. Occupy Iraq in order to secure exceptionally favorable oil concessions.
  2. Threaten Iran in order to please the neocons.
  3. Create unconstitutional powers for the office of the President.
  4. Use those unconstitutional powers to suppress dissent.
  5. Create a pliable and poor working class by encouraging easy illegal immigration, fighting against abortion, and gutting schools of courses that teach critical thinking.

Every item in this list has negative consequences for Americans, even for many who imagined once that Bush was their man. Let’s take them in order.

The first is the occupation of Iraq for special oil concessions. If the oil contract that Cheney is trying to push on Iraqis had been openly negotiated in good faith between two groups with roughly equal power: the Iraqis as an unoccupied sovereign nation and the western oil nationals, the terms of the agreement would look very different. The terms, however, favor western nationals to the tune of $5 per barrel. And with between 200 billion and 400 billion barrels of oil, the contract Cheney is pushing amounts to a loss of revenue one or two trillion dollars for Iraqis and a gain in the same amount for western oil majors.

Most Americans are not aware that this is the situation; but more and more of us are becoming aware of it. The Iraq war was about oil. But even some of us who thought from the beginning that Iraq was about oil did not realize that it was about getting it on artificially favorable conditions. We did not realize that the occupation of Iraq was the use of American forces to gain a private concession worth $1 trillion.

It is a cynical ploy. And it makes all of the violence and destruction in Iraq seem so much more cynical and criminal. It is one thing to argue that America has need of oil and that securing Iraq is in our national interest. ( Not that the oil in pre-invasion Iraq was unavailable. It was.) But it is something else entirely, to hold the Iraqi government hostage with an illegal occupation in order to get oil on artificially favorable terms. It is an axiom of contract law that contracts negotiated with the threat of force are not legally enforcable. What that means in terms of realpolitik is that if the Iraqis sign, American forces will need to stay in Iraq while there is oil to be extracted in order to visibly threaten Iraqis. We are not talking about leaving in 2009, then. Rather, we are talking about leaving in 2029. Fortunately, the Iraqi Parliament understands the situation. And they are dealing with it by going on recess.

Americans, meanwhile, just want the violence to end. Iraqis want that as well. There certainly is no doubt that in the short term Iraq will descend into chaos. And there is no doubt that its ascent out of chaos will involve exercises of power that are repugnant to liberal societies. But that is precisely why the US must leave. Americans may or may not understand this. But we should understand by now the old adage “be careful who you choose as an enemy; for you shall become like him.” And that is a powerful argument for leaving Iraq alone. If western liberalism is threatened by Islamist fundamentalism, we need to stay clear of Islamist fundamentals. We also need to be aware of the threats other forms of fundamentalism pose.

As for Iran, it’s hard to take the Bush administration seriously on the idea of bombing Iran. Bush clearly understands that it would radicalize the nation. Since Cheney is smarter than Bush; he knows it too. So when Cheney talks of bombing Iran, he either does so to elicit support from neocons or he does so because he sees some benefit in radicalizing 30 million Iranians. Why the neocons make the argument is another question. Perhaps it just boils down to the idea that they have ten times as much hubris as they have good sense. Perhaps the neocons, as did the apparatchiks of the Weimar Republic, see history in a Hegelian sense. In this sense, the state is the entity of interest. Loyalty to the state is the meaning of existence. And the state makes war and wins. Because that’s what states do. This is the kind of thinking Leo Strauss seems to have brought to the US from the Weimar Republic and it is evidently the kind of thinking that neocons engage in reflexively.

But Americans have been brought up with a different point of view. And in the Anglophone liberal tradition, personal meaning has nothing to do with the state. Meaning is personal. And the state exists for the convenience of the person; not the other way around. When states go to war, it is to satisfy some specific, identifiable policy agenda. So one might argue for “knocking out” Iran’s nuclear enrichment facilities as a policy issue. The Israelis did exactly this in Iraq in the early 1980’s and got away with it. It did not cause a war. But the neocon idea of “bombing Iran” for what appears to be no other reason than “because it’s there” sounds completely mad even to a just barely sane American public. Anyone who talks about it seriously has lost all sense of the moral underpinnings of Anglophone democratic institutions.

Speaking of losing all sense of the moral underpinnings of Anglophone democratic institutions, we need to talk about the President’s extraconstitutional powers. There are so many of them. And the arguments by which the institution lays claim to them are so many and so specious it’s hard to know where to begin. One claim is that in “a time of war” the President has special powers.

The Constitution does, in fact, make passing reference to a President’s ability to suspend certain otherwise inalienbable rights such as the right to habeus corpus ( to be charged of a crime and tried promptly or to be released; ) but its language specifies emergencies. And it does not specifiy “time of war:” rather, it specifies “invasion.” They meant armed forces of foreign governments fighting American soldiers on American soil. Nothing less. This is not accidental. The founding fathers did not want the President to march off in all directions making war on foreign nations specifically in order to gain special powers. They specified “invasion” because such is an event that poses a clear and imminent danger to the nation

Wars in foreign nations clearly do not satisfy the original intent of the founding fathers. Furthermore, they granted Congress the exclusive right to “declare war.” And they did it for precisely the same reason. The conflict in Iraq is not a declared war. Rather, the “authorization to use force” amounts to no more than a “gentleman’s agreement” by Congress to allow the President to make war in the absence of a declaration. One might argue that to the extent that the invasion of Iraq is a de-facto war as Bush has claimed, the authorization is an unconstitutional bit of legislation and the acts that flow from it are illegal; for it cedes to the Executive powers specifically reserved to the Legislature. Or one might argue that there is no war in Iraq because Congress did not declare one. Under neither condition does the president get to claim extraordinary powers.

The Iraq war is an illegal war. The torture done in Iraq as part of official White House policy is illegal under US and international law. The holding of people in Guantanamo without charges is illegal. The use of the the Justice Department to enforce partisan hegemony is illegal. The act of spying on US citizens is illegal. To the extent that signing statements materially change the sense of law, they are unconstitutional. And to the extent that spying on US citizens is done without court issued warrants, it amounts to unconstitutional search and siezure and is illegal. It is hard to point to any aspect of this executive’s exercise of power that has not been tinged with illegal or unconstitutional behavior.

This is behavior that Americans will not endure. All of it. Americans have been patient with this administration. Americans have been patient with Congress. But the September 2006 election was a signal to the Administration, to Congress, and to the Beltway Bourgoisie that Americans are losing patience. And the record-low popularity of Congress immediately after it passed yet another uncostitutional law ought to be interpreted as a signal that said patience is running out.

It may seem to establishment Democrats that if Americans don’t like the Bush Republican agenda they will simply vote for Democrats. But it’s not axiomatically true. If Democrats are simply “Republican Lite,” then at some point Americans will stop supporting candidates from either party. Parties have fallen before. And they can fall again. Democrats did well in September 2006 because voters expected change on all these issues. They expected a wholesale repudiation of the war in Iraq and of the lies, follies, and political manipulations that got us there.

Americans understand that they dislike the war in Iraq. But it is not the war per se to which they object. It is the whole neocon gestalt of deceipt, abuse of power, and anti-liberalism. And in these areas, a Democratic Congress is proving barely better than the Republican Congress that preceded it.

The reason this Congress is less popular than the previous one has a simple technical explanation. While there is a core of Republicans who are unconditionally loyal to their party, Democrats support their candidates more conditionally, more on the basis of behavior. So long as Democratic legislators behave like Republicans, they will have no supporters. Democrats will not support them because of their bad behavior. And Republicans wil not support them because they are not Republicans. If a Democratic Congress wants support, it must do the right thing. And that has nothing to do with passing more laws and everything to do with making sure that the ones on the books are actually being properly enforced rather than being ignored for the convenience of a very dysfunctional executive.

So how can Harry and Nancy gain popular support? Reject the whole Bush agenda. That’s right. All of it. Identify unconstitutional and unlawful behavior in the executive, and throw the bastards out. This plan of action, BTW, has nothing at all to do with partisan politics. It is about restoring rule of law in Washington. Democrats will be supportive because there are a lot who understand rule of law in a technical sense. But there are a lot of unaffiliated voters and a lot of Republicans who understand rule of law quite well also. And many of them would be very glad to see the criminal element in this administration thrown out long before the election. Even the radical fringe will support such action because they feel betrayed by Bush on immigration.

Once, there were a lot of people who said “No, impeachment is a bad idea because it takes our minds off the legislative agenda.” But not much of Harry and Nancy’s legislative agenda has succeeded. Instead, we are treated to the passage of Bush’s own agenda of unconstitutional spying. That’s hardly a legislative agenda that Americans can support. It’s not an agenda the Congress should have passed. And its not coincidental that Corngressional approval is at its lowest ebb in history the week after the Legislature passed an unconstitutional bill to spy on Americans.

The Legislature has an obligation to uphold the Constitution. Members of Congress are sworn to do this. And part of the Legislature’s mandate is to police the executive. No other body has the power to do this. So long as Congress refuses to uphold its Constitutional obligation to prosecute high crimes and misdemeanors within the executive, tyranny reigns. That’s why Americans are apoplectic. The Iraq war is just the most prominent symptom of this disease.

Wanna fix what’s wrong with America right now? Get rid of the lawbreakers and the usurpers of power within the executive, and toss out their agenda. Yes, it’s as simple as that. And don’t let the Beltway Bourgoisie convince you otherwise. The lies that have been standard fare for the political punditry since the mid seventies are beginning to reap their inevitable rewards and Americans are beginning to wise up. As Lincoln put it “You can fool all of the people some of the time; you can fool some of the people all of the time; but you cannot fool all the people all of the time.” So, Harry and Nancy, it’s time to give up on that game. Or be left behind.


08.09.07

Playing Chicken - An International Credit Game

Posted in Social at 5:55 pm by steve

China and the US have been playing a game of chicken with currency and as everyone knows, games of chicken can end badly. What is the game of chicken, by what is it motivated, and how is it likely to end?

The game started when Nixon visited China in 1972. That visit opened the way for American investment in China. Before long, businesses with manufacturing operations in the US were pouring money into new operations in China. And Wal Mart was creating the world’s most efficient retailing system to distribute those same cheap goods.

This had benefits all around. China’s low cost of labor and land meant that goods could be created and distributed for a tiny fraction of what they had been before. And it meant that the people involved in the businesses of manufacture and distribution of these goods created huge amounts of wealth. As laissez faire economists preached, this kind of organization proved resource efficient in producing goods. And as neo-liberals would correctly point out, extensive trade with China would lead to constructive engagement. It would lead Chinese to adopt some of the ideas that we value in the West, and it would make the Chinese more prosperous. All of these were laudable goals. And all of these goals have enjoyed some measure of success.

But the game had its costs. The biggest cost was the opportunity cost. Dollars that otherwise would have been invested in the US economy were instead invested abroad. This meant that Americans who made much money working in manufacturing areas lost their jobs. It happened first with steel. It happened with refining. It happened with textiles, clothing, and furniture. It happened with semiconductors and with semiconductor equipment. It happened with just about every non-grocery good one can get at Wal-Mart. The consequences of this outsourcing of manufacturing are a source of concern. For when manufacturing moves offshore, many of its derivative support functions must do so as well.

It is in the making of goods and in the efficient distribution of those that real value is created. All other forms of economic expression are derivative; they derive their value from these operations. The consequence is that if one moves manufacturing operations offshore, the very engine that fuels economic growth is imperilled. It never makes sense for manufacturing operations in one nation to be owned and staffed by foreigners for very long. Eventually, locals will figure out how to derive the full measure of economic value from the fact that the manufacturing plant is located on their own soil. And the advantages offshore owners have will disintegrate. This argument suggests that the advantages to investing in China may be more transient than they are permanent.

For this reason and for other reasons we approach a point in time at which the relationship with China is bound to change. One of the reasons for such a change is the fact of a huge trade imbalance. In 2006 the US imported $232 billion more goods from China than were exported to China. That’s close to $800 per capita. If per capita income is $27,000, and if the dollar’s value fluctuated to account for this loss of value to the economy it would precipitate a loss of value of 3.9% per year. And that’s more value than is added by all other kinds of increases in economic activity. If economic value were water and the US economy were a bathtub, the trade deficit with China would be draining the water out of the bathtub faster than we could fill it.

The trade deficit with China has been big for a long time, but it has also been growing faster than our own economy. And there has been one factor that has prevented Americans from perceiving the loss of value. The Chinese, for decades, have been buying US currency using the credits they gain in trade. Specifically, they have been buying US Treasury bonds.

The purchase of US Treasury bonds by the Chinese has a number of effects. One effect is that it drives the value of the dollar higher in comparison to the Chinese currency, the yuan. And this keeps goods imported from China artificially inexpensive. It means that when we go to Wal Mart and we buy a $100 item we imagine that we have paid for the whole thing. But we have not. In actuality, we probably owe six or ten percent more. And that difference is being floated by the US government. The Chinese take it in the form of an IOU from the Federal Treasury. And we, as taxpayers, end up owing the Federal government.

Now this is a game that Republicans caught on to a long time ago. And the Bush administration has been playing it with a vengeance. The fun thing about the game is that the Federal government can get “free” money by playing it well.

Here’s how it works. The Federal Reserve loosens credit and people borrow to buy goods from China. But the credit also causes money to flow into other areas such as real estate, driving up real estate values. Now, in a closed economy this would cause inflation. In a completely laissez faire global economy it would drive down the value of the dollar. But the Chinese policy of buying excess dollars to stabilize the exchange rate means that creating money does not have the normal effects. It simply creates debt with the Chinese.

Under the Dubya administration, the game was expanded. In this case, the goal was for the government to write as many lucrative contracts with supporters as possible. The point was not to provide governmental goods or services. The point was to siphon money out of the government. The Treasury would issue debt. The Chinese would buy it to stabilize currency exchange rates, and the money would go to Bush croneys with contracts in Iraq or San Diego or “Security for the Fatherland” or wherever corrupt officials and shoddy accounting could be found or created.

It’s nice work if you can get it.

So that’s the overall shape of the game: The Chinese buy US debt to stabilize the exchange rate and maintain favorable trade conditions. The US financial community tries to manipulate this willingness to buy debt for its own ends. And it does so by “printing” more and more money.

But the game is not sustainable. One aspect is that it makes people - everyone who holds dollars or things nominated in dollars - imagine they have a lot more money than they actually have. The nominal value of real estate during the Dubya era increased by almost a factor of two. Much of the increase, however, may have been an artifact of loose money. The “increase” in value in such a case was less indicative of an increase in the advantages of holding the good than it was an indicator of the declining value of the dollar. That the same effect did not occur in other real goods was because they all came from China and were sold at an artificial and fictional discount.

The real problem in the economy, however, was that there was so much money being created by the Federal Reserve that it spawned a whole business of creating mortgages that were sold to people who were known not to be creditworthy. Two factors caused this to “make sense.” One factor was that people who arranged mortgages never took on the liabilities. If the mortgagees went broke they lost nothing. They sold the mortgages to third parties. They had incentives to do the paperwork, but no incentives at all to see to it that the individuals who got the money could pay. This was a condition that might not have bothered the people who bought the mortgages, after all, the mortgages were secured by real property. And that real property was accumulating value even faster than the nominal interest rate on the mortgage instrument. That meant not that defaults were a credit risk, but that defaults were a credit opportunity. In other words morgage brokers could knowingly make and sell bad loans and make money from it. Mortgage holders could knowingly buy bad loans and hope to make money on the forclosures.

But then the Chinese stopped buying Treasury Bonds. The credit market grew ever so slightly tighter. Interest rates edged up. And suddenly real estate prices started to peak. Then they started to edge downward. And this caused the realization that the game could not continue indefinitely. With that realization came the collapse of three Bear Stearns hedge funds whose values, evidently, derived entirely from the ever-upward motion of real estate prices.

In the process of becoming intoxicated, there is a point at which more intoxication becomes less desirable than the current state. And if one continues the process of growing more intoxicated, the result is artificially painful. Occasionally it is fatal. Americans have been intoxicated by credit. And the hangover promises to be painful, whatever the form it will take.

In the end, what must happen is that Americans pay off their debts to the Chinese. That means that the Chinese debt instruments will go away. Now the Chinese can dispose of their debt instruments in two ways. They can hold them until Americans pay them off. Or they can dump them in the marketplace.

If they hold them to term, there is a presumption that nothing bad will happen. Maybe that is so. It’s always hard to see thirty years into the future.

But if the Chinese were to decide to dump their debt instruments all at once, there would be no other entity in the world who could buy them. Suddenly the US dollar would plunge in value. It is hard to know how much of its value it might lose. What we do know is that over the last year or two the Chinese have simply been buying fewer US Treasury bonds than they had been and that this has driven the value of the dollar down about 30 percent relative to the Euro. So if the Chinese dumped the dollar it might land at less than half of what it is now. It might lose eighty or ninety percent of its value temporarily.

In the short term this would be disastrous. Americans would suddently be earning second-world incomes. And goods at Wal-Mart would seem expensive beyond reach. Americans, all of us, would be half as rich as we thought we were or a fifth or a tenth as rich.

The bright side is that suddently US goods would be much more affordable in comparison to Chinese goods. And it might cause a material realignment of investment patterns by western corporations. Even the Chinese might invest more in the US. The trick would also bring an end to the deficit spending ways of a corrupt Washington bureaucracy, because it would mean the end of cheap money.

It is probable that the Chinese would not resort to such a ploy because their debt instruments are nominated in dollars. If they drive down the value of the dollar, they lose in two ways. They lose the value of the bonds. And they lose the currency manipulation game they have been playing. So when the Chinese make these threats, it is likely that they do so as a rhetorical means of creating a favorable negotiating position. But in any game of chicken, if both sides fail to imagine the other side capable of persistence in their position - even to the point of some destructive consequence - a disaster is bound to occur.

One way or the other, Americans are going to have to pay for all the stuff we’ve accumulated. How that happens may not be pretty.


08.07.07

The Missing Ink

Posted in Social at 8:34 pm by steve

Nicholas Wade, in the NYT today, writes about affluence. It is a really long piece by newspaper standards, filling a good third of the first page of the science section and taking up all of page four. The piece is about a work by a Dr. Clark. Clark attempts to explain the ascendency of the Anglophone west in terms of something that sounds a lot like the Protestant Work Ethic. That and evolution. It sounds like he is saying the industrious and just survive while the lazy and unjust perish. Or something like that. Even after a whole page of text it’s a little difficult to clearly discern what Dr. Clark’s grand theory of affluence really is.

“The industrial revolution was caused by changes in people’s behaviors ..” The industrial Anglophone west owes its prominance to “a repertoire of skills and dispositions very different from those of the pre-agrarian world.” This is the kind of stuff that we hear Clark saying here. While it seems likely that there is a shred of truth in what Clark is claiming, none of the data presented in the article has any bearing whatsoever on the thesis.

The article is full of graphs and charts and data. One graph shows the steady decline of violent death in England since 1200 AD. Clark, evidently, attributes this to evolutionary forces. But there is simply no reason to do this; it’s not as if the people who committed homicide failed to reproduce. Only the ones who were caught and hung. And in those cases, it was just as likely to have been after they reproduced as before. But even if we manage to explain why an evolutionary explanation might hold some explanatory power if given enough time, it fails to explain why homicide rates in various cities in the New World are now ten or a hundred times as high as those in London. Culture explains the facts better than biology.

The article includes a gragh on literacy. It shows literacy rates in England increasing since 1600. But it is hard to explain literacy in evolutionary terms alone. How does one inherit literacy? Is there a literacy gene? No, that’s absurd. Even if some capacity for literacy is evolutionary, the art of reading is learned.

This chart suggests the same thing as the previous chart; cultures learn and propagate certain behaviors. So one might be able to talk about cultural memes and cultural inheritance as do Richerson and Boyd in “Not by Genes Alone.” One might be able to find some argument for the “Protestant Work Ethic” being part of the explanation. One might argue that the “Protestant Work Ethic” or Clark’s own theory of affluence is constituted of a collection of cultural beliefs and their associated practices. And that these are distinct in European cultures. But it is absurd to talk about biological inheritance of reading skills.

The grand graph of the article is one that plots average income and production efficiency in England from 1200 to the present. It shows both of these factors as being almost perfectly flat until 1800. There are a few peaks and troughs, but both factors hover within about twenty percent of a given level. They do this in a way that perfectly matches Malthusian models. Then both grew exponentially to hundreds of times the previous levels. What happened in 1800?

Hidden in the fourth to the last paragraph of the article, and almost dismissed is the real answer. It’s an argument offered by Kenneth L. Pomeranz of UC Irvine in a recent book called “The Great Divergence.” In it, Pomeranz argues that two other factors really explain the Industrial Revolution: the arrival of steam power, and the exploitation of the North American frontier. Sadly, this theme is not developed in the article. So we will do it here.

In 1803 the US completed the Louisiana Purchase. This opened up a vast tract of land between the Appalachians and the Rockies. And most of it was fertile farm land. It was comparable in size to Western Europe. And it was essentially uninhabited. By 1825 the Erie Canal opened. Grain, lumber, and other commodities produced in the Great Lakes region joined the flow of goods from other regions around New York City bound for Western Europe.

It was also at the beginning of the ninteenth century that Fulton brought forth upon this continent a new steam ship, the Clermont using a steam engine he purchased from Watt. It took its first trip in 1807. By the middle of the century paddle boats navigated the Mississippi. And by the 1870’s a railroad connected the east and west coasts of the US.

By the 1870’s steam ships shuttled raw goods to Europe. There were even refrigerated ships that moved beef from the Argentine to Europe. And by the turn of the twentieth century, Argentina was one of the richest nations on earth because of this trade.

In the mean time, the cost of production of a number of things fell precipitously because of steam power. Cloth was one. Machined goods another. Virtually everything we touch in the west owes its manufacture and/or transport to the employment of fossil fuel. Even most cultivars of plants we grow in our gardens.

The use of mechanical power, notes Jared Diamond, proved an instant gain of 20 percent for agriculture: animals that power a pre-industrial age farm consume this portion of the output. So farm output rose this much just by switching to fossil fuel power. But that switch also meant a dramatic increase in productivity of farm workers. And this meant that grain became almost dirt-cheap. Its low cost of production and its incredibly cheap transport meant that grain from Kansas could economically be turned into bread in Paris or pasta in Rome or bookbinding paste in Edinborough.

The high productivity of farm workers meant for plentiful and cheap labor in early manufacturing plants that were powered by coal. Thus there was a multiplicative effect to the employment of artificial power.

The level of availability of new resources opened up by this pair of phenomena is unprecedented in human history. There has never before been a time when so many unexploited resources became so easily available so rapidly. And the consequences of that are still being enjoyed by the western world.

In fact, as Asians discover and exploit the same ideas, they grow sometimes more effective at exploiting them than we are in the west. They cultivate relationships with nations rich in natural resources, and develop trading relationships akin to European ones, trading manufactured goods for raw materials.

Asians study harder and they work more energetically than Europeans. They certainly outperform other groups in western schools. So Clark is right that different groups - whether for cultural or genetic reasons - perform differently. And since Asians have had agricultural societies for as much as five millennia, the forces of biological and cultural evolution would have acted more strongly on the Asian personality.

But while the success of Asians in Asia and of Asians in the US suggests they possess precisely the cultural attributes Clark is using to explain the ascendency of the west, Asian history proves that it is not culture or biology alone that explains the ascent of Western Europe. If it were, then the ascendency of Western Europe would have been preceded by the ascendency of Eastern Asia. But it wasn’t. And it was the opening of the New World to Western Europe that was the primary differentiating factor. To the extent that Clark’s theory has explanatory power, then he has identified a potentiating factor. He has identified a group of behaviors that allow a particular kind of success given a particular set of conditions. And in this case those conditions were the discovery of how to exploit fossil fuels an the opening up of a vast frontier rich in resources.

It is said of an army that it marches on a full stomach. And this is the underlying fact of the march of western civilization since the discovery of the New World. It started with the importation of potatoes, tomatoes, squash, peppers, and maize as seed stock in sixteenth century Europe. These newer and more productive foodstocks powered Europe out of the days of the plague, creating higher population densities and richer culture. The ascendency continued with the importation of grain and beef. From the middle of the ninteenth century European ascendancy has been powered by coal and by the opening of a new frontier.

If we fail to grasp this idea, we will fail to protect any advantages these factors might have bestowed upon us. In the west we have been oblivious to the Malthusian trap. We have, in fact, denied it. But if we do this blindly and for long enough, we stand to find ourselves living in mud hovels like Russian serfs at the time of the Revolution. No set of beliefs or traits can produce arable land when there is no more. No set of cultural practices can make a block of plain sandstone burn like coal and power our domestic lives, replacing a household full of servants. Not even the Protestant work-ethic.


Party’s Over

Posted in Policy at 4:21 pm by steve

The web page sports an ad to “support the Republican Party. Which makes the thematic statement in the first paragraph all the more humorous “Frank Sinatra said it better ‘the party’s over.’” That’s what Irwin Stelzer thinks, at Weekly Standard. It’s a good image, and one that Digby used in talking about the 2006 election. In her imagery, the Democrats had been brought in as cleaning people to sweep the nation clean of the mess created by a bunch of drunken, senseless frat boys. Stelzer, however, displays a kind of preternatural optimism, however, when he explains that after the party, “normal life resumes.”

Either Stelzer is being disingenuous or he has never been to the kind of party the Republicans have thrown for this country over the last six or thirty years. You know what I mean: well before midnight people are wearing lampshades. And by the next morning there is hell to pay. Heads throb with pain. Litter strews the floor. Valuables lay shattered here and there. People who can remember what they did regret most of it. And some of the people who cannot remember rightly fear the worst. The purpose of certain parties is to make us senseless. And this the Republicans do better than Democrats can ever dream of doing.

So, according to Stelzer the party is over. Signs of bad times start in his article with the collapse of a third Bear Stearns hedge fund. He cites valuable lessons: don’t lend to people who cannot pay. And don’t buy at a premium what is pricey due only to momentum. Good advice, too easily forgotten or ignored. But, argues Selzer, “the underlying economy is sound.”

He trots out the usual statistics: low unemployment, growing economy, growing “workers’ compensation,” and contained inflation. To the extent it is true, it is certainly enough to see the glass as half-full. But the statistics have nothing to do with Bush policy.

Low unemployment is an artifact of a middle-age population. This age distribution is due more than any other single fact to Social Security. States with solid pension programs have lower fertility rates to a significant degree because children are not required to guarantee the security of pensioners. Yet one of only two domestic initiatives in the Bush agenda was to eliminate Social Security. Why? It would drive down the cost of labor. The other great reason for this particular age distribution is that abortion became legal in the 1970s and this dramatically cut the rate of unplanned, unwanted pregnancies. It’s another policy the Bush administration pretends to undermine.

Another factor is a policy to make the lives of the unemployed ever more miserable. Due in part to this policy net employment peaked in the US in the 1990s and has been dropping for years. If the people who have exited the market had instead remained and continued to look for jobs, the unemployment rate would soar into the teens. So the official statistics tell us the wrong story.

So too, does compensation. “Compensation,” as Stelzer calls it, may be growing; but it is a statistical artifact. The bottom ninety percent of the workers has been losing ground for more than a decade. The statistic that Selzer is quoting includes compensation of the guys at the top of corporations. It includes the compensation of guys like Robert Nardelli who was paid over $200 million to quit Home Depot. Average compensation can edge up if the guys in the top brackets make enough more to offset the losses of everyone else. And that appears to be the case.

Finally, GNP may be growing, but we include in GNP a lot of transactions that do not add a great deal of value. Some are financial transactions like the resale of bad debts. But a really big one is health care spending. It has been growing at a rate two or three times that of nominal GNP for decades. And we are just about at the point where any nominal gains in GNP are eaten up entirely by the health care industry. One dollar in six is thrown in the general direction of health care. So if health care went up 18% in a year and GNP rose 3%, then the entire rise in GNP would be due to health care. As it is, the rate of increase is more like 12%.

Again, the fault is Reaganomics policies. The policies to be blamed are unconditional free trade, reckless deficit spending, and a strictly hands-off approach to managing capitalism - the sort that leads to collapses like Enron. These sorts of policies lead to instabilities at home and excess flows of capital abroad. And it is these that make the glass half empty before the hedge funds start to fail.

Stelzer appears to be arguing that Bush’s failure on the economic front is a failure to get out the good news. He cites a half-hearted attempt in which the administration trots out a collection of wonks, sages, and gurus to reassure everyone that they are travelling in an unsinkable ship; but suggests that this really isn’t enough to instill confidence in the market.

His expectation, here, is unrealistic on two fronts. In one respect, economic issues have been studiously ignored by this administration. It has defined itself solely in terms of a single policy: “war on terra” and six years on, it would be almost impossible to change the tune. Bush is a one-issue president. And that issue has nothing to do with the economy, stupid.

Were it otherwise, Bush would still have a handicap. And that is credibility. Almost nothing he has ever said has proven factually true.* In the rare cases it has been categorically related; it has been false. The rest of the time, Bush’s statements have been sheer nonsense.

Pronouncements about Iraq started with “Mission Accomplished.” That’s a message that normally means a successful end has been reached. But just the opposite was true. Then there was “plan for victory,” which never produced either. Then, for two or more years things have been “getting better” as Iraqi and US casualties have risen. So either Bush believes that the more casualties there are in Iraq, the better, or he has a problem with truth. Given that this was almost the only policy issue on which Bush regularly weighed in, it was what he became associated with in the collective subconscious. Dubya was the war in Iraq. And nothing he said about it was true. Nothing.

So there is nothing Bush can say or do that might instill confidence in the markets. He has no credibility.

Credibility is a problem for Americans; we tend to be too credulous. And for this reason, it always appears that Americans have a love affair with hucksters, frauds, and confidence men. We always buy their snake oil once. But eventually we realize we have been taken. And if the fellow has pushed his luck too long and remains in town, we ride him out of town on a rail. That’s when things return to normal.

* The one believable thing Bush has said was his assertion that the NSA was illegally spying on Americans at his request. It is remarkable that the only believable thing that a president might say is a public admission of his own illegal activity.


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