Saturday, January 17, 2009
why is a R administration (at least for a few more days) continually lending money to companies in excess (or close to it) of their market caps?
From an economic perspective, wouldn't it just make more sense to have the gubmint buy them outright and then sell off any assets to cover part of the purchase price?
My answer: That would be SOCIALISM.
Paying huge amounts of taxpayer money to corporations, without any concern about cost or the deficit? That's REPUBLICANISM.
And that, children, is why I am not a Republican, and why you shouldn't be, either.
Okay, you use the trite expression, and then have done.
But no. Mr. Biden has to waterboard the metaphor until it confesses.
“The proof of the pudding is in the eating,” Mr. Biden said in an interview Wednesday. “The Bush-Cheney relationship hasn’t tasted very good. Not a single person you can name for me” — at this point, he leaned forward in his chair, jabbed his finger in the air and punctuated his words sharply. “Look at me, now — a single one can tell you that the pudding has tasted good. Not one. Name me one serious person, liberal, conservative, Democrat, Republican.”
Icky-oo. Don't bring me some Cheney pudding, don't bring me some Cheney pudding, don't bring me some Cheney pudding, don't bring me some here.
(Nod to Anonyman)
The Consumer Product Safety Commission has given preliminary approval to changes in new lead-testing rules after complaints that the measures could have forced thrift stores and sellers of handmade toys to dispose of merchandise or even go out of business.
If formally adopted, the changes approved on a first vote Tuesday would grant exemptions to last year's Consumer Product Safety Improvement Act, which seeks to ensure that products for children do not contain dangerous amounts of lead.
As currently written, the act would require all products aimed at children 12 and under to be tested for lead and phthalates starting Feb. 10. Phthalates are chemicals used to make plastics more pliable.
Large manufacturers and retailers say the cost of testing will not be a burden. But small businesses such as handmade-toy shops and thrift stores say the requirement would force them to spend tens of thousands of dollars to test products such as clothing, in which the threat of lead is almost nonexistent. Many thrift stores said they would be forced to stop selling children's clothing or close altogether.
Actually, it makes perfect sense. You should definitely make it harder for really poor people to put inexpensive clothes on their children during (a) a bad recession, and (b) the coldest winter we have had in a while. Wait...no...I was wrong. That doesn't make sense.
Look, there has been no rash of injuries and deaths from these clothes, or toys. It is just a way to protect the big corporations that make big contributions.*
*("Large manufacturers and retailers say the cost of testing will not be a burden. But small businesses such as handmade-toy shops and thrift stores say the requirement would force them to spend tens of thousands of dollars to test products such as clothing, in which the threat of lead is almost nonexistent. ")
Golly, I wish Public Choice were not such a deadly accurate way of understanding the political world.
(Nod to Roxanne, who knows stuff)
Friday, January 16, 2009
Thursday, January 15, 2009
From the WaPo, and Bob Woodward.
1. Presidents set the tone. Don't be passive or tolerate virulent divisions.
In the fall of 2002, Bush personally witnessed a startling face-off between National Security Adviser Condoleezza Rice and Defense Secretary Donald H. Rumsfeld in the White House Situation Room after Rumsfeld had briefed the National Security Council on the Iraq war plan. Rice wanted to hold onto a copy of the Pentagon briefing slides, code-named Polo Step. "You won't be needing that," Rumsfeld said, reaching across the table and snatching the Top Secret packet away from Rice -- in front of the president. "I'll let you two work it out," Bush said, then turned and walked out. Rice had to send an aide to the Pentagon to get a bootlegged copy from the Joint Chiefs of Staff.
Bush should never have put up with Rumsfeld's power play. Instead of a team of rivals, Bush wound up with a team of back-stabbers with long-running, poisonous disagreements about foreign policy fundamentals.
Really? Rumsfeld snatched the thing away from the National Security Adviser?
I hate Rumsfeld more every day. I wouldn't have thought it possible, but....
I wonder how Congress will define “shovel ready.” My city has a road project that is at the 60% phase on the engineering study. All the EIS and NEPA work have been done. We can be ready to go to bid in four months. The bid process could take another two months. And this is after 5 years of planning, hearings, environmental studies, etc. It could probably qualify as a shovel ready project, but it already has 93% federal funding. I will probably apply to have the other 7% funded by the Obama money machine. If I am successful, the funding will simply be for a project that would have happened without the funding. In fact, given the long lead time for such projects, I assume that all shovel ready projects will be the same way. There will be an infusion of cash to purchase projects that would have been built without the Obama cash. Of course if Obama cash funds my 7%, I can take the $200k that we would have spent on the project and spend it on something else, like chip and seal for existing roads.
I am sure every state is scrambling to get things on the list. Here is an email I received today from the lobbyist for the [STATE] League of Cities and Towns.
From: A GUY
Sent: Monday, January 12, 2009 1:27 PM
To: THE MAYOR
Subject: Federal Stimulus Conference Call and Survey
The [STATE AGENCY] has received a few phone calls regarding the Federal Stimulus Package and efforts that are being made to coordinate “ready to go” projects that can be considered by the incoming Obama administration. As such, we have coordinated efforts with our Congressional Delegation to both collect and disseminate information to the delegation regarding municipal projects in [STATE] that are ripe for consideration.
The new administration is looking for “shovel ready” projects that can be undertaken within 60-180 days of a federal appropriation. While it is still unclear how Congress intends to select projects or divvy up the funds, having your project on a list in front of our congressional delegation will certainly be helpful.
Please fill out the following quick survey if you wish to have your project submitted to the [STATE] congressional delegation as a part of the cumulative efforts of the [STATE AGENCY]. We intend to submit the list within the next week, so time is of the essence
Follow this link to the survey:
Take the Survey
Or copy and paste the url below into your internet browser: [LINK REMOVED]
As an additional resource we have asked Mayor ANOTHER GUY of ANOTHER CITY to help us coordinate
He followed it with another email saying,
In the previous survey we sent out, it only allowed for one project to be entered and does not allow for the reuse of the form. To correct that oversight and allow you to enter multiple projects, please use the following link. You should be able to reuse the link multiple times to fulfill all of the requests you wish to include.
LINK REMOVED, TO PROTECT THE GUILTY
Pretty cool, huh? Multiple projects, shovel ready. And, because of impact studies and engineering studies, ALL of those shovel ready projects, without exception, are going to be projects that were being built already.
Your tax dollars at (not) work.
When Krstic first entered the game, Brooks called plays to get him isolated in the low post. Those were painful. Two TOs and a blocked shot. I wondered aloud if Brooks had ever seen Nenad play before, but after that they used him in pick and pops and drive and dishes to great effect.
The other extremely encouraging thing about the game was the Thunder only took 6 threes while shooting 38 free throws. The big 3 all took the ball to the rim aggresively. This is a lot easier to do when Wilcox and Wilkens are not on the floor clogging the lanes and calling for the ball all the time.
So now the Thunder are 7-33 and have recorded their first win against an opponent with a winning record. They are 4-4 in their last 8. They are actually in danger of not having the most ping pong balls this spring.
Wednesday, January 14, 2009
Here is an awesome excerpt:
"Why is Sen. Clinton, the spouse of the great influence-peddler, being nominated in the first place? In exchange for giving the painful impression that our State Department will be an attractive destination for lobbyists and donors, what exactly are we getting? George Marshall? Dean Acheson? Even Madeleine Albright? No, we are getting a notoriously ambitious woman who made a fool of herself over Bosnia, at the time and during the recent campaign, and who otherwise has no command of foreign affairs except what she's picked up second-hand from an impeached ex-president, a disbarred lawyer, and a renter of the Lincoln Bedroom."
Hmmm, guess he doesn't care too much for Bill either.
So I hereby nominate the "group performing a ritual" who may have permanently disfigured some of the greatest works of art on our planet, the Olmec heads of Tabasco.
"This act was carried out by persons performing an apparent ritual," the institute said. "As part of the 'ceremony," they poured oil, grape juice, salt water and other substances" over the heads, a tomb, altars and other structures.
Grape juice and oil?? WTF??
"The Aztecs and Mayas daubed ceremonial structures with the blood of human sacrifice victims. But pouring substances like grape juice and oil over statues does not figure in most historical accounts of pre-Hispanic religions."
These pieces are displayed in an awesome open air park in Villa Hermosa with howler monkeys in the trees. It was one of our favorite places in Mexico.
On a side note, the Olmec produced a variety of terrific art beyond the giant heads including awesome jaguar and human/jaguar mixes and cool miniature tableaux.
Tuesday, January 13, 2009
A major research institution (MRI) has recently announced the discovery of the heaviest chemical element yet known to science. The new element has been tentatively named Governmentium. Governmentium has 1 neutron, 12 assistant neutrons, 75 deputy neutrons, and 224 assistant deputy neutrons, giving it an atomic mass of 312. These 312 particles are held together by forces called morons, which are surrounded by vast quantities of lepton-like particles called peons.
Since Governmentium has no electrons, it is inert. However, it can be detected as it impedes every reaction with which it comes into contact. A minute amount of Governmentium causes one reaction to take over four days to complete when it would normally take less than a second.
Governmentium has a normal half-life of three years; it does not decay, but instead undergoes a reorganization in which a portion of the assistant neutrons and deputy neutrons exchange places. In fact, Governmentium's mass will actually increase over time, since reorganization will cause some morons to become neutrons, forming isodopes.
This characteristic of moron-promotion leads some scientists to speculate that Governmentium is formed whenever morons reach a certain quantity in concentration. This hypothetical quantity is referred to as Critical Morass.
(Nod to that Yale kid)
Here is the money quote:
"We know what America's future looks like if we continue along our present path. It looks like Michigan."
Bowling in Hawaii: Examining the Effectiveness of Sports-Based Tourism
Robert Baumann, Victor Matheson & Chihiro Muroi
Journal of Sports Economics, February 2009, Pages 107-123
We use daily airplane arrival data from Hawaii's Department of Business, Economic Development, and Tourism to determine the net change in tourism for a variety of sporting events. We find three events generate a positive and significant net impact on arrivals: the Honoulu Marathon, the Ironman Triathlon, and the Pro Bowl. We estimate that the Honolulu Marathon produces 2,183 to 6,519 in net arrivals while the Pro Bowl attracts about 5,596 to 6,726 in net arrivals and the Ironman Triathlon attracts between 1,880 and 3,583 net visitors. Overall, these events generate similar economic impacts on Hawaii's economy despite the fact that the state spends nearly two thirds of its sports tourism budget on the rights to the Pro Bowl while spending a fraction of that sum on the Ironman and nothing at all for the Honolulu Marathon. None of the three events attract the number of net arrivals claimed by their sponsors, and other sporting events do not generate any identifiable impact on the tourist arrivals whatsoever.
(Nod to KL)
"We at IBM were asked to map this out by President-elect Barack Obama's transition team, and our research shows that a $30 billion stimulus investment in just three areas -- smart grids, health-care IT and broadband -- could yield almost one million new jobs within one year. That's possible because these kinds of infrastructure have significantly greater economic and societal multiplier effects than traditional infrastructure like bridges and highways."
Gee, I wonder if they had asked a steel company chief if he would have reached the same conclusion. I guess every cloud has a rent seeking lining.
How is this any different from Larry Flynt's recent statements (by the way, big ups to Alex for the best blogpost title ever on this one)?
Monday, January 12, 2009
For some background, my article on the economics of the apiary.
1. Can the Courts settle this?
2. What would Coase say?
(Nod to Tom, who is himself an attractive nuisance)
(UPDATE: Thanks to the General, for pointing out I don't cut and paste well with the other children)
Who would have thought that? Other than anyone with an IQ over 80, and even one freshman econ course, I mean.
(A nod to ML, who knows garbage when he sees it)
Today, just when we were getting over the long, toxic legacy of the Depression and its misguided emphasis on statist plans to fight poverty, this financial crash threatens to take us back to the bad old days. To avoid such a return, we must keep some principles in mind.
First, we must not fall into the trap of protectionism—neither unilaterally nor multilaterally,
neither in rich countries nor poor. Protectionism will just make the recession spread further and deeper, as it did during the Depression.
Second, when changing financial regulations to repair the excesses of the past several years, don’t strangle the financial system altogether. You can’t have a Revolution from Below without it. This lesson is especially salient as Washington bails out Wall Street banks and failing industries and intervenes in the U.S. financial sector to an unprecedented degree. This bailout might turn out to be the bitter medicine that saves “finance capitalism” from a stronger form of anticapitalism, but in developing countries, open economies are still an open question.
Third, keep slashing away at the enormous red tape that is left over from previous harebrained attempts at state direction of the economy. Learn from the combined dismal track record of stateowned enterprises but also from the unexpected success stories: Private entrepreneurs are far better than the government at picking industries that can be winners in the global economy. Although fierce opposition will be inevitable, to adopt these policies would be to turn the bad hand we’ve been dealt into an outright losing one.
Fourth, don’t look to economists to create “development strategies,” and don’t back up such
experts with external coercion like IMF and World Bank conditions on loans. Such efforts will be either a waste of local politicians’ time or positively harmful. Jeffrey Sachs alone can take partial credit for the rise of two xenophobic rulers hostile to individual liberty—Evo Morales and Vladimir Putin—after his expert advice backfired in Bolivia and Russia. If like-minded experts couldn’t get it done in the 50 years after the Great Depression, they can’t do it in the next 50 years. Nothing in the current crash changes these common-sense principles.
2. N. Greg in the Sunday NY Times: Is Government Spending a too Easy Answer?
"If you hire your neighbor for $100 to dig a hole in your backyard and then fill it up, and he hires you to do the same in his yard, the government statisticians report that things are improving. The economy has created two jobs, and the G.D.P. rises by $200. But it is unlikely that, having wasted all that time digging and filling, either of you is better off.People don’t usually spend their money buying things they don’t want or need, so for private transactions, this kind of inefficient spending is not much of a problem. But the same cannot always be said of the government. If the stimulus package takes the form of bridges to nowhere, a result could be economic expansion as measured by standard statistics but little increase in economic well-being."
Sunday, January 11, 2009
In my experience, this just doesn't happen in other large American cities. It used to somewhat in the Manhattan of my youth, but not anymore.
I wonder why? Are the drivers unionized? Is there a (high) minimum wage for cabbies? Are medallions restricted enough that the cab business is so profitable that some dough trickles down to the drivers? Does the city subsidize colorful cabbies like Switzerland subsidizes traditional dairy farmers in the Alps?