Nov 30, 2011

Proposal: a general tech company strike

Taking a look at the execrable bills before Congress trying to quite literally destroy the internet as we know it, creating massive security holes at the same time, I was struck by a thought. The idea behind this bill—of a piece with the drug warrior mentality—is to seriously expand the reach and severity of legal punishment for downloading copyrighted material. Among other things, websites like YouTube and Twitter will be dragooned into policing their own users for fear of lawsuits, normal netizens will live in fear of criminal prosecution for infringing content (like singing a copyrighted song), and search engines will have to deal with the terrific headache of de-indexing a blizzard of infringing domain names, which will for obvious reasons pop up by the millions.

Here's the thought. This would be a stupendous waste of money for all the big internet companies. What if they all went on strike? Say the bill passes Congress and it's headed for the President. The next day, Google, YouTube, Facebook, Flickr, Yahoo, Twitter, and so on all go dark, and are replaced by a sober video explaining why the bill is atrocious, plus the phone numbers of the president and their local representatives. Can you imagine the outrage?

In fact, the best objection I can think of is that it would be too effective. The internet is so key to the economy and basic support infrastructure that shutting down those key sites might cause serious damage. I don't know the technical details of this, but one might preserve functionality for key personnel, or maybe do it just for a day, or make it a click through on every site. The point is that the tech companies, their flaws aside, are for once all on the same side, the side of the average netizen, and they have tremendous leverage they could exploit in some way to defeat this bill. They should use it.

Nov 29, 2011

Gates on vaccine deniers

Watching Bill himself on CNN delivering some pretty apocalyptic language on the vaccine-autism crowd. He said something like it's an "absolute lie that has killed thousands of kids."

Good stuff.

Nov 27, 2011

The next round

After reading a lot about the 2008 crisis, I came to the conclusion that the fundamental issues that drove that crisis—too large, too interconnected banks, captured regulators, and a Wall Street culture that demands stupendous profits—were not only not resolved, they were even worse than before. Another crisis is in the offing, sooner or later.

The answer may be sooner. If the Eurozone unravels, I think the safe bet is that all the big banks will be up to their nuts in it someway or another. MF Global showed how this might work, but mostly I just suspect that if there's a big shitpile out there somewhere the banksters would be making "aggressive" trades on it. Basically just laying down my gut feeling here rather than a detailed argument to see how it turns out.

Nov 24, 2011

Happy Thanksgiving!

This was the biggest gathering my family's had since I can remember, as well as the best turkey I've ever had.

Nov 22, 2011

Nov 21, 2011

Programming note

Apologies for the recent darkness here. I spent last weekend in Princeton visiting an old Peace Corps friend. This week I'm heading back to Colorado to have Thanksgiving with my family, so posting will probably be light.

Nov 18, 2011

The cowardice of Millennial men, ctd

Ellen Campesinos, who plays bass for Los Campesinos!, in an article explaining why ladies in popular bands apparently don't get any action:
Having eliminated fans and support-band members, we're left with the guy hanging out at the bar whose friend has dragged him along to the gig. In a lot of ways, he's the most appealing choice. I want to hear that someone is not fussed about us. The thing is, this hypothetical guy normally throws me some glances, and I shoot some back, but he still won't talk to me. And I don't want to reduce it to status anxiety or a power issue, because obviously it's intimidating to talk to any stranger, let alone someone who was just performing. But why are there always attractive girls who talk to the male band members post-show? They have insights and they like books and they have no problems with light flirtation. Maybe it's because they're better at hiding their inner crazy fangirl, or maybe it's because some men worry they will come across as slightly creepy.
As you might expect, there's more to it than that, but I since this confirmed my pre-existing beliefs, it's obviously true.

Nov 15, 2011

The new Greenwald

I got this one from the office, and I've been reading it in bursts to control my blood pressure. His central contention, that the rule of law is dead and buried in the United States, and the elite establishment is holding openly celebratory parties on its grave, is inescapably true.

I was watching some old Carlin the other day. It's not really standup, a lot closer to ranting. Five years ago I would have said Carlin was about 50 percent right, but today I'd say closer to 80 percent.

Carl Sagan: The Gift of Apollo

Nov 14, 2011

Collected links

1. "Toxin" and "poison" are really nonsense terms these days. Mutantdragon brings the science.

2. Check out Thomas Jefferson's expurgated gospels.

3. Awesome piece on how Hispanics are saving small towns. ¡AndalĂ© pues!

4. Hertzberg on Occupy Wall Street.

5. NBC just gave me a sweet job, and I didn't even have to interview! Oh wait, I confused myself with the daughter of a former president. Well, at least she has hedge fund experience. At least I'm not like working for free and broke as shit.

How did Tom Brokaw write a book about national service without discovering Americorps?

AmeriCorps, as noted before here, is the largest national service organization in the United States outside the military. More than 80,000 people every year do service work in this program across the country for a pittance. Its support has historically been broad-based and bipartisan, with one consistent complaint. Despite the fact that today nearly three times the number of people have served in AmeriCorps than the Peace Corps, the latter is still far more well-known. As John McCain noted in the Monthly in 2001, the program’s profile is too low:
But for all its concrete achievements, AmeriCorps has a fundamental flaw: In its seven years of existence, it has barely stirred the nation’s imagination. In 1961, President John F. Kennedy launched the Peace Corps to make good on his famous challenge to “[a]sk not what your country can do for you, but rather what you can do for your country.” Since then, more than 162,000 Americans have served in the Peace Corps, and the vast majority of Americans today have heard of the organization. By contrast, more than 200,000 Americans have served in AmeriCorps, yet two out of three Americans say they have never heard of the program.
There is a good reason for this; the program was designed to be as decentralized as possible, which is a large part of its success. Many AmeriCorps workers are distributed to already-existing NGOs and other service organizations where instead of doing grunt-level work, they recruit and manage actual volunteers, giving those organizations the needed logistical backbone operate much more effectively—as McCain notes, each AmeriCorps member generates on average nine additional volunteers. Most of the money is put in the hands of state governors, who get to decide (within reason) which organizations get it.

All this creates broad-based, bipartisan political support, but at the expense of a high national profile. It is of a piece with what Suzanne Mettler calls the “submerged state, ” where beneficiaries of a government program often do not realize they are beneficiaries—according to McCain, even some AmeriCorps members do not realize they are working for the government.

There was a glaring example of this lack of recognition recently. Tom Brokaw just wrote a book called The Time of Our Lives, a goodly slice of which was devoted to national service, and in it did not once mention the AmeriCorps program. In an interview with Andrea Mitchell promoting said book, he mentioned that perhaps the country needs some kind of rapid response team to deal with natural disasters, specifically mentioning the tornadoes that recently hit Joplin, Missouri. The truth, of course, is that AmeriCorps members were actually there helping to clean up and rebuild after that tornado outbreak.

On one level, Brokaw should know better. Surely part of the reason AmeriCorps is so low-profile is that he and other elites who claim to be very supportive of national service can’t be bothered to do some cursory research.

But the government should be doing a lot more as well. One can imagine several ways to build AmeriCorps’ public profile, like McCain’s idea for a highly visible AmeriCorps flagship program, or even just a public service announcement featuring the president, as JFK provided for the Peace Corps. AmeriCorps ought to permeate the national atmosphere to such a degree that by default it forms the backdrop of any discussion of national service, so even Tom Brokaw couldn’t possibly overlook it.

(Cross-posted at Ten Miles Square.)

Quote for the day

"If the world succeeds in coming out through the other side of this crisis, you should expect to see even more countries joining the perpetual surplus brigades leading to even more demand for safe dollar denominated financial assets. That, in turn, means either big U.S. budget deficits or else some bold new innovations in financial engineering to meet the demand." --Matthew Yglesias, in yet another reminder of the fact that for every creditor there is a debtor.

What do French ambulances sound like?

Bill Bailey explains:

Probably funnier if you know French.

Nov 13, 2011

Nov 12, 2011

Pity party for straight dudes

Via Sullivan, check out this Dan Savage interview:
...heterosexual male identity — and in America I don’t want to get too pointy-headed about it, but it’s really this package of negatives. You know, to be a straight guy is not to be a woman and not to be a faggot and so it doesn’t really leave you much room to maneuver. If there’s anything about your interests or personality that can be remotely perceived as feminine or faggoty, you have to kill it or people won’t believe you’re straight or you’ll be tormented — you know, questions for the rest of your life. And it’s kind of sad to watch how hemmed-in straight guys are.
That is surely true, but there's another aspect to this as well. Growing up as a straight boy, especially in a liberal environment, you are constantly bombarded by the ways men have treated and continue to treat women like shit. They are all absolutely true. Just the other day I read the most horrifying piece on the daily violent abuse to which female bloggers are subjected.

Especially if you self-identify as a thoughtful type, it's quite easy to get into the habit of bending way, way, backwards in a desperate attempt to avoid being a sexist asshole, which can quickly turn into (as most of my ex-girlfriends can tell you) abject cowardice. We still have a (thankfully decaying fast) cultural expectation that guys are supposed to make the first move. I am really almost incapable of this, and thus end up spending a lot of time alone. I admit it, if I'm single and an interaction with a woman turns even slightly romantic, I usually freeze up like I've been doused with liquid helium:

I think this should be obvious, but just to be clear, I am in no way trying to minimize the ongoing oppression of women, or compare the situation of straight males as being somehow just as bad. I'll take my discomfort over specific, detailed threats to come and rape me with a screwdriver. Rather I'm saying that our history of patriarchy and sexism has done men no real favors. Like Southern whites during Jim Crow, or Apartheid-era Afrikaners, men could only achieve subjugation by doing serious damage to ourselves at the same time.

Weekend links

1. Why American's won't work dirty jobs. Short answer: lousy pay.

2. A Kansas town fights a mercury-spewing plant and the EPA.

3. Glenn Greenwald's new book looks good.

4. Who broke the Penn State pedophile scandal?

5. Great review of Niall Ferguson's latest.

Nov 11, 2011

Science on the right

This is pretty funny, but also the most explicit, overt avowal of anti-intellectualism I have ever seen:

"It should be up to the American people to decide what's true." That is a truly radical statement, spitting in the face of the last 2000 years of human progress. We used to burn witches, torture heretics, and believe the earth was at the center of the universe; the underpinning of nearly every development that has allowed us to move past those times is the idea that there exists an external reality independent of belief.

It reminded me of this Krugman column from a couple years back:
What I that know-nothingism — the insistence that there are simple, brute-force, instant-gratification answers to every problem, and that there’s something effeminate and weak about anyone who suggests otherwise — has become the core of Republican policy and political strategy. The party’s de facto slogan has become: “Real men don’t think things through.”

Friday jam

Pogo does Pixar's UP:

Nov 10, 2011

The White Salmon is freed!

Check out this dam being breached:

Is There National Service in the Air?

George Clooney’s new movie, The Ides of March, about the shady backroom dealing of a presidential campaign, has been getting mixed reviews for its strong acting but weak plot, bad script, and "basic misunderstanding of politics." But one scene is worth extracting, where Ryan Gosling, playing the candidate’s campaign manager, lays out a case for mandatory national service:

On one level, this is astonishingly blinkered, substituting a cheap cynicism for real analysis. "Everyone over the age of 18 are past the eligibility age and will be for it. Why not?" As noted earlier here, age doesn’t seem to be stopping the Tea Party from rabidly opposing even AmeriCorps—a far more modest program. However, the idea of national service, mandatory or not, has still been coming up amongst American thought leaders across the media spectrum.

A recent spate of items from across the media have been promoting the idea of national service. Tom Brokaw devotes a substantial portion of his new book The Time of Our Lives to it. Jim Lehrer said recently if he could make one decision unilateratally, he would impose mandatory national service, and Joe Klein, long a supporter of a draft, mentioned non-military national serviceit f avorably in recent appearances promoting a Time cover story. George Clooney's character supports it in his new movieThe Ides of March (see above), where he plays an aspiring presidential candidate, and he Clooney personally supported the idea in a recent interview with Charlie Rose.

National service means, in this context, working for a federal program to serve the nation domestically, including things like building public works, helping the poor and elderly, and conservation. The idea is more than 100 years old, but the rationale behind it—though it has evolved considerably—remains similar to the original, and its advocates tend to crop up most during hard times.

William James first proposed national service as a substitute for military service, a way to get the moral benefits of war without all the horror and unnecessary bloodshed (he regretted America's "squalid war with Spain" of 1898). His essay introducing national service for the first time is titled "The Moral Equivalent of War:" "Militarism is the great preserver of our ideals of hardihood, and human life with no use for hardihood would be contemptible." But instead of military conscription, a country should have "a conscription of the whole youthful population to form...a part of the army enlisted against Nature." (Men only, of course.) It is primarily about moral uplift, "manly virtues" instilled, getting "toughness without callousness," but it is also about unifying and serving the country, in a variety of ways. James advocates "knocking the childishness" out of the "luxurious classes," so they may "come back into society with healthier sympathies and soberer ideas;" as well as mining coal and iron, building roads and boring tunnels, all for the greater good.

FDR, though he was primarily concerned with getting the masses back to work, still lauded the "moral and spiritual benefits" to working in his Civilian Conservation Corps while doing valuable work for the nation. Kennedy and Johnson's service ideas planed off James's "manliness" and "war against Nature" rhetoric, but it was still about moral uplift, and unifying and serving the country. Kennedy ("ask not...") said of Peace Corps volunteers that they were "one of the most encouraging manifestations of the national spirit." Johnson, when he started VISTA, told the first group that service would be difficult, but they would have the "satisfaction of leading a national effort," the "ultimate reward which comes to those who serve their Nation." Bill Clinton, who created AmeriCorps, hailed the "unifying power of citizen service," and the accomplishments of national service agencies from the CCC up to his time, including AmeriCorps volunteers that had helped rebuild after a tornado struck his home state.

The current crop of thought leaders promoting national service have much the same reasoning. In recent appearances promoting his Time story, Joe Klein promoted the idea of mandatory national service as a way to "give back" without joining the military. Brokaw, who goes into the idea in the most depth, laments that America has become "two societes with too little connective tissue," and says "it is time to renew the ideal of national service for all," referencing JFK. He lauds programs like Teach for America as emblematic of what is necessary, and tells how his own children benefited morally from service in Haiti and elsewhere. In an interview with Jon Stewart he even agreed with a proposal for mandatory national service to rebuild the nation.

Though national service is an idea always floating around the country, it tends to bubble up most in hard times. FDR faced the Great Depression when he instituted the CCC (and dozens of other jobs programs). Kennedy had the peak of the Cold War—part of the intended Peace Corps service was surely the (real or imagined) threat of communist expansion around the Third World. Clinton's time was relatively less imperiled, but there was still a recent recession and war, slow wage growth, and widespread anxiety about the national debt and overseas economic competition. After 9/11, John McCain called for a huge expansion of the AmeriCorps program, and in the midst of the 2008 freefall, both presidential candidates supported the idea—Obama ended up signing a bipartisan bill tripling AmeriCorps’ size. And now, of course, we have a persistently atrocious economy, the worst in eighty years .

It makes sense, then, that public figures from movie stars to magazine columnists to retired anchormen are now talking about further expanding America’s ongoing experiment in national service. If history were any guide, the country probably would be—though the majority of national service’s champions have been Democrats, even the likes of William F. Buckley supported the idea in the past. But the Tea Party has happened to American conservatism. House Republicans, many of whom voted just two years ago to triple AmeriCorps’ size, are now attempting to zero out the program entirely, for the third time this year alone. Before one can expand national service, it must first survive.

(Cross-posted at Ten Miles Square.)

Nov 8, 2011

Cormac McCarthy does restaurant reviews

Okay, not really. But this is absolutely spot-on:
A rider wearing an elaborate mustache and carrying a Winchester onehanded nudged his quarterhorse toward the sheriff. Hell he’s right there sheriff.

I know it. Im lookin at him same as you.

What are we waitin for then.

We caint touch him now deputy. They got their own way here.

The riders watched as the women left their station wagons and strollers and encircled the outlaw. As if some ancient instinct united them. Silent as wolves and staring intently at the broken man standing there. He saw his mistake and called out to the riders reaching toward them with his one good arm but was struck down with a savage blow from a rolled yoga mat.

That old boy done walked into the wrong parking lot, said the sheriff.

The posse sat their horses and stood silent witness as the women swarmed over the outlaw’s fallen form and soon they could not see him but for the flurry of spandex and ponytails.

Department of WTF, Live Tweeting/Cartooning a Marathon Bureau

No, seriously. How awesome is that?

Nov 7, 2011

Meeting old friends

Apologies for the recent darkness here, but I've been working hard on some stuff for the magazine that I might turn into an actual magazine piece! Probably not, but who knows... I spent some time with the Editor-in-Chief Paul Glastris today going over the points, and then basically starting from scratch. It's a good kind of feedback though, and Paul is really good at striking the right balance of reasonable, honest criticism.

I love this job.

In other news, I met some old Peace Corps South Africa buddies for some drinks and greasy food after work today, and it was really, really great. Unexpectedly so. Though I think this will change once I process the experience, the whole Peace Corps service has been feeling bizarrely unreal, like it happened to someone else, and this was a nice reminder that no, it was all genuine. Plus, I missed those guys! It's nice to be able to laugh at the same kind of inside jokes and say "yebo" without having to explain yourself.

Nov 5, 2011

Portal 2

Finally got around to finishing this title. It came out when I was in South Africa, and I wanted it so bad I could taste it. This is one of the rare times when the game actually lived up to that level of expectation.

It's been out for awhile, and everyone has dissected it much better than I could have anyways, but I'd just like to challenge the haters who don't believe that video games can possibly be art to give this one a shot. Just stupendously good, and not in a video-gamey way.

Halloween lights dude meets LMFAO

Weekend links

1. The NYT doggedly keeps at the Somalia famine. Up to 750,000 people could die.

2. Matthew Yglesias on the ethos of hard work.

3. A look at a mysterious radioactive cargo container.

4. Apparently some anti-vaccine quacks see no problem putting viruses in the mail. The fight against woo never ends.

5. Occupy Wall Street and the future of journalism.

Nov 3, 2011

Quote for the day

"It's perfectly fine for Mitt Romney to say that Barack Obama's record of killing terrorist leaders and extricating America from endless wars indicates a troubling lack of unthinking belligerence." --Paul Waldman.

What it's like being a female blogger

Sometimes people point out how web journalism is an overwhelmingly white male phenomenon. Wonder why? This is probably part of it:
I got my first rape threat as a blogger when I was on Blogspot, so new that I still had the default theme up and hadn’t even added anything to the sidebar. I can’t even remember the pseudonym I was using then, and I probably had about 10 hits on a good day, seven of which were me compulsively loading the page just to make sure it still existed, and the other two of which were probably my friends. I wrote a post about some local political issue or another, expressing my misgivings, and a reader kindly took time out of his day to email me.

‘You stupid cunt,’ he said, ‘all you need is a good fucking and then you’d be less uptight.’

I stared at it for a couple of minutes, too shocked to move. There it was on my screen, not going away. Someone really had thought it was appropriate not just to write this email to a complete stranger, a totally unknown person, but to send it. I deleted it, and spent another few minutes staring at the blank hole in my inbox where it had been before shaking it off and moving on.
It gets much, much worse. See here for more stories.

I said once while I was in South Africa that seeing how men behave there made me ashamed of my gender, not least for the fact that then, as now, one thought that floated uncontrollably across my mind was: thank God I'm not a woman. How entitled is that? (See Louis CK for a good take on this.) While that kind of overt, public harassment is much less common here, I can't avoid the conclusion that a sizable swath (though it wouldn't take many with the internet) of American maledom is also composed of awful pricks not worth the powder it would take to blow them to Hades.

Obviously we have a long ways to go to civilize men, or at least keep the disgusting, vicious cowards stomped down out of sight, and out of women's inboxes. Amanda Marcotte has some ideas how.

Journalism and bias

This is a bit of inside baseball, but I highly recommend this article by Conor Friedersdorf on a journalist named Caitlin Curran who lost her job for attending Occupy Wall Street and being photographed holding a sign. I think it's a bit of a tricky question, but ultimately Friedrsdorf threads the needle:
To borrow a phrase, every editor who is not too stupid or too full of himself to notice what is going on knows that propagating the myth of "objective journalism" is indefensible. A newspaper or radio program may try to hide or obscure the fact that the people responsible for its content have opinions, convictions, and biases. But it is impossible to function as a journalist without making subjective judgment calls about newsworthiness, relevance and emphasis, or covering issues about which you have an opinion. Pretending otherwise requires willfully misleading the public.

An ethical journalist ought to be accurate. She ought to be fair. Her aim ought to be reporting the truth or earnestly advancing a logically sound argument, rather than enriching herself or bolstering her reputation or shilling for her partisan or ideological allies. It is perfectly legitimate for a journalistic organization to decide that it is going to publish or broadcast work that presents verifiable facts as neutrally as possible, and avoid permitting its employees to inject statements of opinion into their professional output. If that's what you mean by "journalistic objectivity," you've not run afoul of my views.

What is objectionable is the View from Nowhere, a term popularized in this context by Jay Rosen, a professor at NYU journalism school, my alma mater. "In pro journalism, American style, the View from Nowhere is a bid for trust that advertises the viewlessness of the news producer," he writes. "Frequently it places the journalist between polarized extremes, and calls that neither-nor position 'impartial.' Second, it's a means of defense against a style of criticism that is fully anticipated: charges of bias originating in partisan politics and the two-party system. Third: it's an attempt to secure a kind of universal legitimacy that is implicitly denied to those who stake out positions or betray a point of view. American journalists have almost a lust for the View from Nowhere because they think it has more authority than any other possible stance."
Again, I do think it takes a bit of thought to determine on the strict ethical grounds whether or not Curran should have held that sign (meaning perhaps her boss might have considered a slap on the wrist, not a spit-flecked tirade as apparently happened). But what clinches it for me is that in other circumstances, journalists can get away with outrageous distortion, and so long as their bias is cloaked in the right way.

Here's an example: James Pitkin, a man who used to write for the Willamette Week and is now apparently a private investigator, wrote this miserable piece of shit on Reed College back in 2008:
ON A RECENT SATURDAY AFTERNOON in Southeast Portland, a mass of two dozen nudists, painted blue, were gathered at Reed College.

Reed's Eliot Hall
They call themselves “Picters,” after an ancient Scottish tribe, and they carried turkeys and other assorted meats for the feast that was about to ensue as hundreds of hungry students lined up.

The breasts and genitals on display attracted no stares. Neither did the student nearby who took a hit off a footlong glass bong as gray-bearded alums walked by with their toddlers and teenagers in tow.

For that matter, students took little notice later that evening when a student, under the influence of psychedelics, was escorted through campus by two emergency workers, his screams echoing off the brick walls of the library:

“I’m white! You’re black! Oh, for the love of God, you fools! Death! Oh, for the love of God! Sex! Death!”

Workers took him to a large white tent on campus specially designed with plush beds, soft lighting and deep-blue tapestries to comfort people having bad trips.
This ought to be a textbook example of the very worst kind of journalism. Though there are numerous factual errors in the piece (the guy yelling about black and white was not a student, for example), there are no outright fabrications. No joining a protest or advocating political parties or positions. It does, however perfectly encapsulate about half of Jay Rosen's list of how journalists are dishonestly ideological, particularly this one:
The sphere of deviance. The power to place certain people, causes and ideas within the deviant sphere is one of the most ideological things journalists ever do.
In the sphere of deviance we find “political actors and views which journalists and the political mainstream of society reject as unworthy of being heard.” As in the sphere of consensus, neutrality isn’t the watchword here; journalists maintain order by either keeping the deviant out of the news entirely or identifying it within the news frame as unacceptable, radical, or just plain impossible…Anyone whose views lie within the sphere of deviance—as defined by journalists—will experience the press as an opponent in the struggle for recognition. If you don’t think separation of church and state is such a good idea; if you do think a single payer system is the way to go; if you dissent from the “lockstep behavior of both major American political parties when it comes to Israel” (Glenn Greenwald) chances are you will never find your views reflected in the news. It’s not that there’s a one-sided debate; there’s no debate.
Exactly. Pitkin opportunistically used the tragic case of a Reed student dying of a heroin overdose to caricature the college and smear everyone in it as dirty hippies (breasts! genitals!) who care more about doing drugs than saving their friends and classmates:
While no one this reporter interviewed would say so on the record, it was hard not to get the sense that many felt it’s simply the price to be paid for that freedom—not a reason to make changes. Not a single student we interviewed believes Reed has any problem with drugs.
I hear he's since lost his job. Good. I imagine it had more to do with declining newspaper revenues, and he should have been driven out of the profession by a pack of hounds, but it's still a step in the right direction.

Nov 2, 2011

Collected links

1. Mike Lux has some excellent advice for Obama on the banks.

2. The new Google Reader really, really sucks. Change it back!

3. Great profile of Manmohan Singh.

4. Matt Taibbi on Rick Perry. Good stuff.

Say, this guy's good

Misallocated capital, ctd

The latest evidence that Wall Street has not changed at all since the financial crisis comes from former Goldman Sachs CEO and former New Jersey governor Jon Corzine, whose company MF Global just went down. They were, of course, leveraged to the teeth (meaning they borrowed about $40 for every dollar of capital), but the kicker is they weren't even investing in anything. Instead, they went all in on a Eurozone bailout:
Over the past year, most investors have been fleeing the sovereign debt of Spain, Italy and other euro-zone basket cases. Not Mr. Corzine. The onetime chief executive of Goldman Sachs and former New Jersey senator and governor who has run MF Global since early 2010, was all in, buying up $6.3 billion worth of discounted euro-zone debt.

As Azam Ahmed reported in The Times on Tuesday, Mr. Corzine appeared to be wagering that the European Union would come to the rescue of Europe’s troubled economies, averting a default. In other words, Mr. Corzine was betting on a bailout.
Apparently they were also dipping into depositors' funds, which is quite illegal. Financiers can never, ever, ever be trusted. Wall Street is different from a casino in that casinos have rules. Imagine if you could raise $10 billion, lever up to $400 billion, take that to the roulette wheel, and distribute the whole around all 38 slots. If you win, you're rich, if you lose, you quick pay yourself $50 million in severance, declare bankruptcy, and walk away. Nice work if you can get it.

Something that isn't said enough

Martin Wolf in the FT:
Blessed are the creditors, for they shall inherit the earth. This is not in the Sermon on the Mount. Yet creditors believe it: if everybody were a creditor, we would have no unpaid debts and financial crises. That, creditors believe, is the way to behave. They are mistaken. Since the world cannot trade with Mars, creditors are joined at the hip to the debtors. The former must accumulate claims on the latter. This puts them in a trap of their own making.

Three of the world’s four largest economies – China, Germany and Japan – are creditors: they run current account surpluses, in good and in bad times (see charts). They believe they are entitled to lecture debtors on their follies. China, an ascendant superpower, enjoys berating the US for its imprudence. Japan, a US ally, is more discreet. Germany’s ambitions are closer to home. It wishes to turn its eurozone partners into good Germans, instead...

As the poet A.E. Housman wrote: “To think that two and two are four/And neither five nor three/The heart of man has long been sore/And long ’tis like to be.” You cannot keep your surpluses and fail to finance others’ deficits, one way or the other. Yet this is what Germany is trying to do. Germany effectively controls the European Central Bank. It also has the strongest credit rating. So it can decide how the rescue facilities will work. Not well, alas, as Willem Buiter of Citigroup has argued in the FT. Yet even France cannot do much more than moan about the outcome.
People in the US complain all the time about the trade deficit. I would agree that it's probably too high and should be pushed down in the long term. But what people don't seem to understand is that it is literally impossible to have a world composed entirely of creditors. It's of a piece with the (also not understood) point that one person's spending is another's income—that's how you can get the paradox of thrift.

Nov 1, 2011

Cartoon for the day

From my (probably) most loyal reader outside of my mother, here's a pretty spot-on New Yorker cartoon:

Even kinda looks like me.

Obama, AmeriCorps, and jobs

Back in the halcyon days of 2008, Barack Obama talked a lot about national service. He famously proposed a plan to double the Peace Corps and triple AmeriCorps.Though the Peace Corps didn't get quite that size a boost, AmeriCorps did: back in 2009 President Obama signed a bill to triple its size, though the requisite funds were never completely appropriated. Even before the Obama expansion, AmeriCorps was by far the largest national service program in the United States. It now employs around 80,000 people every year, at a bare-bones $10,000 or so each.

It is curious that the president's jobs plan does not include anything on the program. If what the economy needs is jobs, AmeriCorps is about the cheapest and quickest way to get some. The program also provides community assistance at a time when state and local governments are slashing their public services—last year alone they cut 200,000 jobs.

It was the National and Community Service Trust Act, signed by President Clinton in 1993, that technically created AmeriCorps, though the first President Bush laid the foundation with the National Service Act of 1990. Its objectives—providing a lot of the grunt work for Habitat for Humanity, for instance—are so unobjectionable it is one of a vanishingly few programs that still enjoy some bipartisan support—more Senate Republicans voted for Obama's expansion than against. George W. Bush, though his funding of the program was somewhat uneven, consistently supported the ideal of volunteerism, and held an event at the White House celebrating the 500,000th AmeriCorps volunteer.

However, now the Tea Party holds the House, AmeriCorps is suspended over the garbage disposal for the third time this year. House Republicans don't just want to cut the program—they want to eliminate it entirely. (Jim DeMint says the program is "the federal government reaching further into the world of civil society.") Given the previous Republican support, this seems odd. But a descent into the fever swamps could help explain the new GOP position. One facet of opposition involves former AmeriCorps Inspector General Gerald Walpin, who was fired back in 2009. It’s a long story, but see here for a list of reasons the AmeriCorps board (who asked for him to be removed) had for sending him off. On that list was a complaint from a US Attorney that in an investigation of Sacramento Mayor Kevin Johnson (an Obama ally), Walpin was behaving unprofessionally: trying “to act as the investigator, advocate, judge, jury and town crier.” Walpin’s sued to get his job back; his suit was thrown out and he lost the appeal. But the conservative media uses Walpin as an example of a clearly politically-motivated firing, and cites his unproved investigation as obvious fact.

It goes on in this vein. Michelle Malkin calls AmeriCorps “FoodStampCorps,” claiming it is “essentially a special taxpayer-funded pipeline for radical liberal groups backed by billionaire George Soros that masquerade as public-interest do-gooders.” Glenn Beck compared the program to the SS, the Nazi paramilitary organization. Ed Morrissey insists that volunteers should not be paid. (Leave it to the 1%, then?)

In any case, given that even the easy parts of Obama's bill have a slim chance of passing this House, one might expect the president to be pressing the AmeriCorps issue every chance he gets. Why not expand a program to the level a bipartisan bill has already authorized? On this, one can only speculate. AmeriCorps has many highly-placed supporters—John McCain is a big fan—and it could be that Obama is trying to keep the program out of the headlines so congressional insiders can save it in negotiations. He did request $1.26 billion for the agency overseeing AmeriCorps in his FY2012 budget back in February, a marked increase from FY2011.

AmeriCorps survived the 90s and the Bush years by a combination of those influential supporters and a nationwide network of governors, mayors, and universities. A petition earlier this year to save it got 105,000 signatures. Despite the conservative howling, the program is cheap—for the price of FY2011’s Bush tax cuts for the rich, we could have hired more than 4 million members.

Whatever happens, let us hope someone can at least keep AmeriCorps from the Tea Party's axe, by whatever means available. It is a valuable program and well worth expanding.

All aboard!

TNC reports back from his decision to abandon flying in favor of trains:
Last week, I began my attempt to opt out. I was scared I'd be bored to tears, but at the same time I didn't feel like I should be too entertained. I declined to install the Baldur's Gate saga on my laptop, and resolved to bring only my books and my writing. It's true I endured a few askance looks from my wife, but once I explained my thinking, she was in support.

The train, in all aspects, was a superior experience. The first thing was the feeling of everything melting away, of someone else taking control. When flying there are generally so many rules to be obeyed, and times when specific things can happen that I generally feel like, as a passenger, I'm actually a co-pilot. Lights tell you when you can and can't move. Announcements indicate (because I use a lap-top and iPad) when it's safe to read, write or listen to your music. Food and drink are administered at precise times. All of this within a confined space.

But there was a freedom on the train that you may need to be taller than six feet to really understand. You could walk as you needed to. You could sit in the cafe car and watch the scenery. You could fall into your book. Or you could just sleep, something I can't really do on airplanes.

Finally there is the fact that, as much as possible, I should avoid supporting airline travel in its current American iteration. As I said before I don't do this expecting any kind of policy change--but The God of Policy is not omnipotent. I expect an end to that sick feeling I get whenever I see passengers arbitrarily herded into full-body scans, or stranded on runways for hours, or yanked from their seats and stripped searched. There is still value in looking oneself in the mirror--whatever one might hope to see. Thoughtful resistance, in and of itself, is valuable.
I heartily support this preference, even if it has no real effect. Airplanes and the whole associated security theater have become a nearly intolerable nuisance, and for about zero tangible benefit.

Collected links

1. Hitchcock meets Angry Birds.

2. A Romney advisor was involved with what looks like a pretty nasty Lebanese militia.

3. The idiotic Texas assault on Planned Parenthood. One more chapter in the ongoing "conservatives don't care about the effects of their policies, only the social signaling they display" series.

4. The developing world is still doing okay.

5. DeLong on the ECB.