Thursday, February 19, 2009
It's always been fun to listen to Rick's morning rants, but I fell in love with guy back in the fall, when in response to some of the early TARP ideas, he suggested we just put a hammer and sickle on the flag.
We he almost matched that performance today. If you read Drudge Report, you've already seen the clip as it is ighlighted, but it is really refreshing to hear someone, somewhere speak the obvious truth on a mainstream network.
Wednesday, February 18, 2009
Incidentally, the cover of the NY Post was plastered with the story on the chimp, so the idea that the cartoon refers to Obama is absurd.
Nonethess, expect to see more of this from the Obama's allies on the hard left. You come at Obama, you better be a minority (The Republicans are not total idiots).
The irony is that it was perfectly acceptable to say anything about Bush, no matter how disrespectful, obscene, or ridiculous. Nothing wrong with that. We the People earn the right to trash a guy when we give him the office. Or we did. I think we are going to find that right has been severely curtailed in an Obama presidency. People are going to think twice before ridiculing Obama. No one wants to be called a racist.
Wednesday, February 11, 2009
Ho ho ho, street thug Barack Obama is gonna kick whitey's ass clear back to Texas! Wait, what is this horrible thing? Oh, a fanzine for, uh, Ron Paul, the brief and inexplicable Internet fad of late 2007. (At least LOLcats were kind of funny!) Well listen up socialists, the elderly Texan congressman and very loosely aligned Republican is still alive and still has a few fans. They got together and made this "DIY" magazine. One of them drew this picture. For a donation of $500, you can hang a copy of this very drawing on your dorm wall or whatever. Chicks love this shit! Youth!
And now, the giant terrifying version:
[Young Americans for Liberty]
Monday, February 9, 2009
It's Darwin's 200th birthday, so evolution is an even bigger topic in the media right now than usual.
That reminded me of a question I meant to pose to our posse some time ago. It has do with this book...
For those of you unfamiliar with Behe, he is one of the leading forces in the Intelligent Design movement. In other words, Creationism. He first gained notoriety with this book...
As you guys might remember, I have always been a little uncomfortable with the complete theory of evolution. It's not something I'm happy to admit. Richard Dawkins has said, "It is absolutely safe to say that, if you meet somebody who claims not to believe in evolution, that person is ignorant, stupid or insane (or wicked, but I'd rather not consider that)." I'm not fond of the application of any of the adjectives to myself, so I tend to keep my reservations about evolution to myself.
The Edge of Evolution spoke to some of my concerns. It's been a while since I read it, but as I recall Behe basically argues that two parts of evolutionary theory are unimpeachable - natural selection and genetic passing of traits. But he then argues that on a microscopic level, many biological systems are "irreducibly complex": the molecular systems involved in even basic biological functions like flagella are incredibly complex and would fail without the existence of multiple different biological processes existing simultaneously. Behe argues that since the overall function would completely fail without the multiple processes, the sucess of the biological function, in evolutionary theory, would require all the processes to evolve simultaneously in a single organism at a single time. He then demonstrates that even if you consider all the generations of all organisms in all time, this is basically mathematically impossible.
When I cracked the book, I sort of expected a mix of Christian evangelism and pseudoscience. As a result, I was pleasantly surprised by the extent of detailed biochemistry in the book. Here is a typical passage, the likes of which made the head of a lowly trader like myself spin.
For an otherwise scientific and reasoned closet evolution skeptic like myself, his argument was very seductive. Apparently some scientists see plausibility in his arguments (see the Amazon page endoresements). Yet from what I can glean from other things I have read, "irreducible complexity" is considered a flawed argument, and moreover, there are specific flaws in many of Behe's arguments. The problem I've had is that the rebuttals I've seen are either rather scattershot (again see some of the Amazon comments) or the arguments seem to focus on details of biochemistry that are completely over my head. For example, I could not make heads or tails of this recent discussion in Behe's blog. I have not had much luck finding a comprehensive rebuttal that is still comprehensible to a layman.What I have noticed in some comments is a complete pre-emptive dismissal of Behe's argument, because he is obviously a tool of the Creationist/Intelligent Design fanatics. See Dawkins quote above. It reminds of the tone you sometimes hear in dismissals of anyone challenging the prevailing global warming orthodoxy as they are obviously tools of the Oil Companies.
Fortunately, our readership, while limited, does have some excellent minds in the biological arena. I am curious whether, in their experience, there is any serious discussion at all of Behe's arguments or if evolutionary theory as it currently exists is considered settled law. If so, could they point me to a relatively coherent rebuttal of Behe's arguments. It's been months since I cracked his book, but his arguments continue to entice me, and if they are irretrievably flawed, I would like to understand why that is.
Friday, February 6, 2009
Thursday, February 5, 2009
Wednesday, February 4, 2009
The first section, "Whither Growth?" was the worst part of the article. I am actually going to reprint alot of the article in this section, because virtually every sentence was flawed. The rest of the article is not nearly as awful, so I'l spare Blogger's capacity and your patience by not reprinting the rest of the article.
The economy will recover. It won’t recover anytime soon. It is likely to get significantly worse over the course of 2009, no matter what President Obama and Congress do. And resolving the financial crisis will require both aggressiveness and creativity. In fact, the main lesson from other crises of the past century is that governments tend to err on the side of too much caution — of taking the punch bowl away before the party has truly started up again. “The mistake the United States made during the Depression and the Japanese made during the ’90s was too much start-stop in their policies,” said Timothy Geithner, Obama’s choice for Treasury secretary, when I went to visit him in his transition office a few weeks ago. Japan announced stimulus measures even as it was cutting other government spending. Franklin Roosevelt flirted with fiscal discipline midway through the New Deal, and the country slipped back into decline.
Let me begin by saying that Timothy Geithner was an awful choice for Treasury (Obama's biggest mistake so far). He and Summers were both complicit in many of the bad decisions that led to this fiasco. To think he is going to ride in on a white horse is ridiculous. The main lesson of the past century is that government meddling usually makes a bad situation worse. Yves has a must-read analysis of the latest "bad bank" proposal. Seriously, if you have only five minutes, skip the rest of my response and read his analysis. As for Leonhardt's article, his lines about Japan and the New Deal are typical of his shoddy analysis. He implies Roosevelt's attempt at fiscal discipline directly led the country back into decline. That is simply not true.
Geithner arguably made a similar miscalculation himself last year as a top Federal Reserve official who was part of a team that allowed Lehman Brothers to fail. But he insisted that the Obama administration had learned history’s lesson. “We’re just not going to make that mistake,” Geithner said. “We’re not going to do that. We’ll keep at it until it’s done, whatever it takes.”
After reading Yves post, Geithner's point should be clear. The Treasury will do "whatever it takes" to protect the big banks, even at the expense of the larger economy. Admittedly the Treasury has a good selfish reason for doing this, as at least half of its primary dealers are technically insolvent, but let's be clear that the Fed and Treasury are doing this to protect their own operations, not the economy at large. If protecting the economy at large was a concern, most of the biggest banks - Citi, Merrill, JPMorganChase - would need to be nationalized, as they are all basically insolvent at this point.
Once governments finally decide to use the enormous resources at their disposal, they have typically been able to shock an economy back to life. They can put to work the people, money and equipment sitting idle, until the private sector is willing to begin using them again. The prescription developed almost a century ago by John Maynard Keynes does appear to work.
Arrrghhh! The revisionist history of late on Keynes is almost incomprehensible to me. His work was as discredited as Malthus only a few decades ago. I am afraid I am going to have to digress here for a moment, because the assumptions in this paragraph are so completely wrong.
The only way you can have economic growth is when you "put to work the people, money and equipment sitting idle" in some kind of productive enterprise. If I wanted, I could create 4 million jobs tomorrow. Two million people would dig a ditch from L.A. to New York and another two million would be tasked with filling it back up. This would create jobs, but it would be completely unproductive. In fact, paying for that work would require either taking or borrowing money from people who are doing productive jobs, thereby reducing the capital those people would otherwise use to expand their productive enterprises. You create jobs, but you actually damage the long-term health of the economy. This is the genius of Keynes. The broken windows fallacy is a much more elegant description of this situation, and if you really want to understand the issue in full, you should go ahead and read this short but classic book.
That's not to say that there aren't productive roles for the government (rebuilding roads, for example), but the end result of efforts should raise the productivity of everyone in the economy. The problem with stimulus is that instead of having good productive projects in search of funds, you have funds in search of good, productive projects, and inevitably in the race to spend the funds, lots of unproductive projects are funded.
Richard Freeman, a Harvard economist, argues that our bubble economy had something in common with the old Soviet economy. The Soviet Union’s growth was artificially raised by massive industrial output that ended up having little use. Ours was artificially raised by mortgage-backed securities, collateralized debt obligations and even the occasional Ponzi scheme.
Where will new, real sources of growth come from? Wall Street is not likely to cure the nation’s economic problems. Neither, obviously, is Detroit. Nor is Silicon Valley, at least not by itself. Well before the housing bubble burst, the big productivity gains brought about by the 1990s technology boom seemed to be petering out, which suggests that the Internet may not be able to fuel decades of economic growth in the way that the industrial inventions of the early 20th century did. Annual economic growth in the current decade, even excluding the dismal contributions that 2008 and 2009 will make to the average, has been the slowest of any decade since the 1930s.
So for the first time in more than 70 years, the epicenter of the American economy can be placed outside of California or New York or the industrial Midwest. It can be placed in Washington. Washington won’t merely be given the task of pulling the economy out of the immediate crisis. It will also have to figure out how to put the American economy on a more sustainable path — to help it achieve fast, broadly shared growth and do so without the benefit of a bubble. Obama said as much in his inauguration speech when he pledged to overhaul Washington’s approach to education, health care, science and infrastructure, all in an effort to “lay a new foundation for growth.”
Did Leonhardt not miss the irony of decrying our similarity to the Soviet Union and then claiming that Washington needs to save the economy? The downfall of the Soviet Union was central planning, but Leonhardt now wants Washington to decide how to invigorate the economy. This sounds like something out of The Onion. Perhaps Leonhardt is correct that the epicenter of economic growth right now is Washington, but that is precisely the problem.
Who knows where the next source of growth will come from. That is the magic of a capitalist economy. Nobody knows where the next growth source is, but a million different people are independently experimenting to find the next source. Someone will develop the next great productivity-enhancing device, and like the personal computer, mobile phone, GPS, etc. before it, it will boost the economy by making people more productive. [Incidentally, I completely disagree with Leonhardt on the waning of the information technology boom. We are still at the infancy of the information technology era. The biggest productivity gains are still ahead of us. Despite my well-documented bearishness, my main hope for our economy is derived from this fact. If Washington would stop picking winners and losers and let creative destruction do its thing, there is no reason we couldn't ride this productivity wave to shockingly new levels of prosperity. You should read the article he linked. It's odd that he chose that article as it in no way supports his contention that the information technology boom is over, and in fact, pretty much argues that Washington should get out of the way.]
And that takes care of the first section. I need to hit the sack, so I'll spare us all any more detailed analysis. Anyway, the rest of the article is much more sound, although it ranges all over the place and is pockmarked with small but serious errors. I particularly had to snicker at Leonhardt's love for the so-called "Rahm's doctrine":
You never want a serious crisis to go to waste,” Emanuel said. “What I mean by that is that it’s an opportunity to do things you could not do before.”
Rahm's doctrine. Like it's some breakthrough in political thinking. Gimme a break. Sun Tzu and Machiavelli said the same thing. Caesar used a crisis to become emperor; Hitler used one to become fuhrer; Bush used one to attack Iraq. Pretty much every American war had a hyped-up crisis that was used as pretext to galvanize the country.
Anyway, there is some good stuff in the article, but between those bricks, the mortar is filled with nonsense. Not a Leonhardt fan.
Monday, February 2, 2009
David Leonhardt wrote this piece in the NY Times Magazine yesterday. It touches on a whole slew of things we have been discussing. He went to Yale and worked for the Washington Post, and now the Gray Lady, so I would venture to say that some here might dismiss him as a whack-job liberal (see his reference to Keynesian economics working in the third paragraph), but I would love to hear what Gams, VD, Hoss and Friedie have to say about his myriad musings. I am overwhelmingly behind most everything he wrote here.