The real economic crisis

2008/09/30 at 16:52

The current economic crisis is just a symptom of what really keeps me up at night–the trade deficit. Here’s a really clear explanation of it:

Through the quarter-century in which China has been opening to world trade, Chinese leaders have deliberately held down living standards for their own people and propped them up in the United States. This is the real meaning of the vast trade surplus—$1.4 trillion and counting, going up by about $1 billion per day—that the Chinese government has mostly parked in U.S. Treasury notes. In effect, every person in the (rich) United States has over the past 10 years or so borrowed about $4,000 from someone in the (poor) People’s Republic of China.

And why it keeps me up at night:

Like so many imbalances in economics, this one can’t go on indefinitely, and therefore won’t. But the way it ends—suddenly versus gradually, for predictable reasons versus during a panic—will make an enormous difference to the U.S. and Chinese economies over the next few years, to say nothing of bystanders in Europe and elsewhere.

The issue is finally going mainstream. See this Time Magazine article.

The Wall Street crisis in a nutshell

2008/09/22 at 13:51

In the broadest sense, how did we get to the current economic crisis? This MeFi comment meshes with my general understanding:

The conversion of the financial system from wealth generation to gambling (aka wealth extraction) continues apace, to the point that they’re even backing gambling itself.

A large fraction of the modern financial system doesn’t create new wealth anymore. It’s not a factory that makes wealth; it’s a casino that extracts it from the economy, while giving little to nothing back. You can see it most clearly with the idea of backing gambling as an “investment”, but the system is full of ideas like these. A gambler creates no wealth, he just takes it from other players. Likewise, most hedge funds create nothing: they just take it from everyone else in the economy.

It’s now more profitable to manipulate other people’s wealth than it is to generate your own, so that’s where all the best and brightest minds are going — into taking whatever they can out of the economy, at your expense. Most of these are zero-sum games, and it’s the average citizens that are on the losing side.
Oh, and the Treasury.

Fraud protection?

2008/09/22 at 10:21

I took a photo of this message on a gas pump. I don’t understand how a $75 cap protects the customer from fraud, especially when it states on the pump how to exceed the limit.
Fraud protection?

A conservative endorses Obama

2008/09/22 at 09:42

Former publisher of the (conservative) National Review Wick Allison endorses Barack Obama. He starts off with his definition of ‘conservative’ and ‘liberal':

Conservatism to me is less a political philosophy than a stance, a recognition of the fallibility of man and of man’s institutions. Conservatives respect the past not for its antiquity but because it represents, as G.K. Chesterton said, the democracy of the dead; it gives the benefit of the doubt to customs and laws tried and tested in the crucible of time. Conservatives are skeptical of abstract theories and utopian schemes, doubtful that government is wiser than its citizens, and always ready to test any political program against actual results.
Liberalism always seemed to me to be a system of “oughts.” We ought to do this or that because it’s the right thing to do, regardless of whether it works or not. It is a doctrine based on intentions, not results, on feeling good rather than doing good.

Allison follows this with evidence that Bush and McCain do not fulfill this definition of conservatism:

But today it is so-called conservatives who are cemented to political programs when they clearly don’t work.

Today it is conservatives, not liberals, who talk with alarming bellicosity about making the world “safe for democracy.” It is John McCain who says America’s job is to “defeat evil,” a theological expansion of the nation’s mission that would make George Washington cough out his wooden teeth.
This kind of conservatism, which is not conservative at all, has produced financial mismanagement, the waste of human lives, the loss of moral authority, and the wreckage of our economy that McCain now threatens to make worse.

Finally, and most importantly, Allison explains how Obama exemplifies his conservative values (emphasis added):

Barack Obama is not my ideal candidate for president. . . But I now see that Obama is almost the ideal candidate for this moment in American history. I disagree with him on many issues. But those don’t matter as much as what Obama offers, which is a deeply conservative view of the world. Nobody can read Obama’s books (which, it is worth noting, he wrote himself) or listen to him speak without realizing that this is a thoughtful, pragmatic, and prudent man. It gives me comfort just to think that after eight years of George W. Bush we will have a president who has actually read the Federalist Papers.
Most important, Obama will be a realist. I doubt he will taunt Russia, as McCain has, at the very moment when our national interest requires it as an ally. The crucial distinction in my mind is that, unlike John McCain, I am convinced he will not impulsively take us into another war unless American national interests are directly threatened.
[A]s a stance, as a way of making judgments in a complex and difficult world, I believe [conservatism] is very much alive in the instincts and predispositions of a liberal named Barack Obama.

This is a view of conservatism that even this dyed-in-the-wool liberal can appreciate.
(via Dispatches from the Culture Wars)

Sarah Palin nightmares

2008/09/19 at 20:58

Eve Ensler writes, in part:

Sarah Palin does not believe in evolution. I take this as a metaphor. In her world and the world of Fundamentalists nothing changes or gets better or evolves. She does not believe in global warming. The melting of the arctic, the storms that are destroying our cities, the pollution and rise of cancers, are all part of God’s plan. She is fighting to take the polar bears off the endangered species list. The earth, in Palin’s view, is here to be taken and plundered. The wolves and the bears are here to be shot and plundered. The oil is here to be taken and plundered. Iraq is here to be taken and plundered. As she said herself of the Iraqi war, “It was a task from God.”

Insightful

2008/09/15 at 14:35

A comment from a MeFi thread:

Factors in the Democrat’s favor this year: a disastrous economy, an unpopular war, an incumbent president with a 30% approval rating, far more money and better organization than the other side, a candidate who is charismatic, smart, accomplished and eloquent, an opponent who is old, out of touch, disliked by a large portion of his own party and a Washington insider when people want change.
Factors in the Republican’s favor this year: the Democratic candidate is black.
Result: the race is dead-even.
No matter who wins, you can learn a lot about America just by looking at where the race stands today.

Lie to me

2008/09/15 at 10:52

Not surprisingly, John Scalzi nails something I’ve been thinking a lot about: dishonesty in political campaigns:

[T]he McCain campaign is the reductio ad absurdum of the GOP strategy that “facts are stupid things” — and that from the simple realpolitik point of view that winning isn’t just the important thing, it’s the only thing, it might be onto something. It’s a campaign that will lie and continue to lie when called on its lies because as far as it can tell it’s being rewarded for doing so.

It’s entirely possible that McCain campaign will benefit from a critical mass of people — and not just dyed-in-the-wool, will-vote-Satan-into-office-if-he-wears-a-flag-pin Republicans — who have been primed by years of intentional and structural undermining of the legitimacy of fact, to accept bald-faced lying as just another tactic; people, in other words, who know that they are being lied to, know the lies are being repeated in the face of factual evidence, and know the campaign knows it is lying and plans to continue to do so all the way to the White House… and sees that sort of stance as admirable. Can you blame McCain for taking advantage of this dynamic? Well, quite obviously, you can, and should.

Go read the entire post.

Hurricane Ike Relief

2008/09/14 at 14:34

Our nearby high school and middle school are serving as emergency shelters for evacuees from hurricane Ike. I volunteered this morning at the high school. I talked to one family who said that their house was flooded up to the tops of the doors, and some others who had heard that their electric service might not be restored for up to a month.
Please keep these people in your prayers and donate to the American Red Cross disaster relief fund.

Good analogy

2008/09/08 at 09:05

Rafe Colburn makes an excellent analogy about the government takeover of Freddie Mac and Fannie Mae:

Letting these two quasi-governmental companies fail would crater an already failing housing market, destroying an awful lot of wealth. That’s not something any politician is going to let happen if they can stop it (nor should they). The US is sort of like the family where the single income earner takes month’s wages and blows them at the casino. You may hate them for what they did, but you still have to take them back in because they’re the only one with a job in the first place.

Usability win

2008/09/08 at 09:00

I’ve probably assembled and installed well over a dozen ceiling fans in my adult life. Over the years, the manufacturers have improved the designs so that the fans work better and, more importantly, are easier to install. This past weekend, I installed a new Hampton Bay ceiling fan in the kids’ bathroom. Two features presumably keep it from rattling: rubber washers where the blades attach to their brackets and rubber bands around the light globes where they are held in place by screws.
Ceiling fan detailBut this fan had a feature that made a big alleviated probably the biggest installation headache: holding the blades in place while you screw the blade brackets into the body of the fan. Due to the light kit, the screw holes are awkward to access, plus you have to hold the blade in place, the fan in place and screw in the screws upside down. Inevitably for me, the first screw for each blade falls to the floor once or twice before I get it in (the second screw is much easier, since I no longer have to hold the blade in place).
The helpful feature of this fan: the screws that attach the blade brackets to the fan were already inserted into the blade brackets and held in place so that they would not come out. That meant I just had to hold the blade and screw them in. Very nice.