Reading Science' Tea Leaves

"Free markets do not guarantee social outcomes, only economic outcomes."

This simple, obvious notion seems difficult for many. Perhaps overwhelmed by the legacy of science, we are unable to resist the desire to apply equations where they can not be affirmed. Sometimes it seems as if we are impatient with science's constraints, as if it has no heart and clearly would follow our path if it could only escape itself.

Or perhaps we are like an energetic Jane Austen character, full of confidence in how things should and must go.

Naivete can be forgiven. But dismissive arrogance is a harder blunderer. There are entire schools of economic and sociological thought out there, encountering the world and each other like armies in the night, doing untold damage as they feel their way along. They create a self-supporting structure, courts and journals, university chairs and grants. Most important, they generate new generations of believers.

The history of duodenal ulcer disease is instructive. Many of the luminaries of medicine were involved in its meticulous revelation. Complex studies, experiments, trials with surgery and medicines were undertaken by centers of medical excellence. Procedures were developed, medicines approved and epidemiological interactions highlighted high risk people as its victims. Complex relationship with acid producing glands, nerve supply to those glands, the brains connection to those nerves all combined over the years to build a stately dome of interrelated factors that physicians systematical blocked, treated and surgically removed. Decades later an Australian group tried to convince the medical community that all the work and the elegant structure it created was lovely nonsense, that the cause of ulcer disease was a bacterium. The initial response was laughter; the Australians were invited to events for comic relief. But, as things turned out, they were right. Medicine, the history and precedence created by medicine's great leaders, the consensus were all wrong.
 

Oil Imports and its Import

U.S. imports are falling rapidly. By 2014, the EIA expects the country to import just 32 percent of its oil, down from 60 percent in 2005. Some of this is recession related but the U.S. is also producing more oil and oil alternatives.

The price of oil has always been a focus point for economists as it impacts GDP, acting as a sort of tax on the economy. (Apparently we prefer our growth inhibiting taxes to be self imposed.) But there is more here than just volume of imports. Price and total costs are the real points. Money for imported oil leaves the economy like narcotics money and is unavailable for productive domestic use. So, despite our decrease in oil imports, we are still spend a lot on it, more next year than in any year between 1983 and 2003.

So beware the politician pointing to our success in domestic production; cost is the point.

Here is a graph on the relationship between oil import expenditures and GDP: (from Michael Levi)

Forest Fires and Unintended Consequences

In the  Bitterroot low-altitude Ponderosa Pine forest in Montana the historical records, plus counts of annual tree rings and datable fire scars on tree stumps, demonstrate that a Ponderosa Pine forest experiences a lightning-lit fire about once a decade under natural conditions. A program of active fire suppression began around 1910 and became effective after 1945. Under this program small fires were aggressively attacked by fire fighters in an effort to eliminate or limit forest damage. It was remarkably successful; the effect was less so. 

The mature Ponderosa trees have bark two inches thick and are relatively resistant to fire. This allows the mature trees to resist fire while the smaller, more fire-sensitive Douglas Fir seedlings that have grown up since the last fire take the brunt of the damage.. After only a decade's growth until the next fire, those seedlings are still too low for fire to spread from them into the crowns of the mature trees. Hence the fire remains confined to the ground and lower brush. As a result, many natural Ponderosa Pine forests have a park-like appearance, with low fuel loads, big trees well spaced apart, and a relatively clear "understory".

The effect of aggressive fire suppression for decades let the understory fill up with Douglas Fir saplings that would in turn become valuable when full-grown. Tree densities increased from 30 to 200 trees per acre, the forest's fuel load increased by a factor of 6, and Congress repeatedly failed to appropriate money to thin out the saplings. Sheep grazing in national forests may also have played a role by reducing understory grasses that would otherwise have fueled frequent low-intensity fires. When a fire finally does start in a sapling-choked forest, whether due to lightning or human carelessness or (regrettably often) intentional arson, the dense tall saplings may become a ladder that allows the fire to jump into the mature trees' crowns. The outcome is sometimes an unstoppable inferno in which flames shoot 400 feet into the air, leap from crown to crown across wide gaps, reach temperatures of 2,000 degrees Fahrenheit, kill the tree seed bank in the soil, and may be followed by mudslides and mass erosion.

So the well intentioned--and successfully performed--fire suppression of early fires ironically results in bigger and more destructive fires and forest damage.

Body Snatchers: A Short Review

I watched "The Body Snatchers" recently, the one with Donald Sutherland and Brooke Adams. It is a remake of "Invasion of the Body Snatchers," a 1956 American science fiction film directed by Don Siegel and starring Kevin McCarthy and Dana Wynter. It has been a popular theme and there have been several remakes, one with Meg Tilly. The original story is the 1955 science fiction novel by Jack Finney, which describes the fictional town of Santa Mira, California being invaded by seeds that have drifted through space to Earth. The seeds replace nearby sleeping people with perfect physical duplicates grown from plantlike pods, while their human victims wither to dust. (The biology of all this should not be thought on too hard.) The original book had an ecological bent with the invaders being intergalactic scolds; the films have all been just really scary. All eventfully have a few perceptive and very human empathetic individuals alone in a city filled with emotionless copies of men, without ambition, anger or love, plodding zombie-like through the day doing their routine as routine alone. Their only real devotion seems to be expanding their influence through replacement.They have a mild philosophy: The very thing that makes humans unique is painful and fatal. The new copies have no emotion and live without emotion's pain and danger. The humans, on the other hand, struggle to maintain their humanity and the risk that entails.

Unanswered in all versions is the question, how does a society of individuals who are just going through the motions advance? Or even survive?

So, if this were a political allegory, which group would be the citizen and which the body snatcher? Ambition aside, of course.

Cab Thoughts 1/26/13

"I have no child for whom I could wish to make a provision-no family to build in greatness upon my Country's ruins." --Washington

The S&P 500 was up 16% and hit a five-year high. The Dow was up 7.3%. Most money managers didn't do as well: 65% of large-cap managers underperformed the S&P 500 as did 80% of large-value investors; 67% of small-cap managers didn't beat the Russell 2000 index.

U.S. household debts peaked five years ago at an astonishing $13.8 trillion. Since then it has declined to $12.9 trillion. Loan write-offs, at $585 billion, account for 60% of that decline; in the last five years Americans have walked away from $3 in debt for every $2 they’ve paid off.


For the paranoid among us: Vermont Transportation Secretary Brian Searles said, “….. calculating how much of a...(transportation).. tax is owed would be done through the global positioning system devices that are expected to be standard equipment [capable of tracking location, time] in cars later this decade.”

There are 1200 proposed new coal plants. China and India account for 76 percent of proposed capacity. Turkey and Russia also have big plans. And a growing number of coal plants are being proposed for developing countries such as Cambodia, Guatemala and Uzbekistan, nations that are looking to cut-rate sources of energy to fuel economic growth. Global demand for coal is expected to grow to 8.9 billion tons by 2016 from 7.9 billion tons this year. China is expected to add about 160 new coal-fired plants to the 620 operating now, within four years. During that period, India will add more than 46 plants. I wonder if the environmentalists will become active in these two, clearly dominant, countries contributing to fossil fuel use.

The Bundesbank has decided to move 300 tons of German gold from the Federal Reserve in New York back to Frankfurt. What could be the motive there, if any?

The DOE is setting up the Rare Earth Metals lab at the land grant University in Ames, Iowa, at Iowa State University. The former Govenor of Iowa, Tom Vilsack, is the current Secretary of Agriculture.

From the Seattle Times on grounding the Dreamliner: At Boeing, pushback on 787 grounding. "Gordon Bethune, the former Boeing executive who left to run Continental Airlines -- and who in that position bought the grounded Dreamliners now owned by United -- is emphatic that the government overreached. He criticized the decision to ground the plane, which was made by Secretary of Transportation Ray LaHood and FAA chief Michael Huerta. "Neither of those two guys know the front end from the back of an airplane," Bethune said. "They jumped the gun, but that's the product of a cover-your-ass administration," he fumed. "It's heavy-handed, draconian and way, way beyond what needs to be done to protect the public." "Obviously, (Boeing's leaders) are disappointed in this overreaction," Bethune said. "But it doesn't help them to bitch, so they will never say anything publicly that could be disparaging to the government.""Don't think they are making light of this," Bethune added. "I'm sure they are chagrined as hell. But they are going to fix it.""

Cessna was forced to replace lithium-ion batteries on its CJ4 business jet with nickel-cadmium after a battery fire on the plane in 2011.

Already at a record, the Cushing Storage hub in Oklahoma added another 1.8 million barrels to storage sending total Cushing stocks to 51.9 million barrels of oil in storage facilities at the energy hub.
There has been 6.3 million barrels of oil added to Cushing during the last 6 weeks. To put these numbers into perspective, Cushing oil inventories stood at 28.3 million barrels for this time a year ago.
There is more oil being produced than used. U.S. refineries are maxed out. This oil is going international. What are the Saudis to do?

Who was Solomon Shereshevsky?

Common Core is a federal program created to make the American educational system more competitive internationally. The mathematics plan is quite specific, grade to grade, and, as it is linked to federal grants, will probably become the norm for starter education programs. Stanford University professor James Milgram, the only mathematician on the validation panel, states that the Common Core math scheme would place American students two years behind their peers in other high-achieving countries. In protest, Milgram refused to sign off on the standards.

A recent study shows that life expectancy of white males and females has fallen in the U.S. by 3 and 5 years respectively in people without a high school diploma. The steepest declines were for white women without a high school diploma, who lost five years of life between 1990 and 2008, said S. Jay Olshansky, a public health professor at the University of Illinois at Chicago and the lead investigator on the study, published in Health Affairs. By 2008, life expectancy for black women without a high school diploma had surpassed that of white women of the same education level, the study found. This is third world stuff.

There is some evidence that those strange "savant" characters who remember weird or astonishing things or can do unexpected tasks may have a connection to left brain injury with right brain compensation or relief. Some are connected to childhood trauma which leaves a child impaired in some way but extraordinarily able in another. But there is one provocative study involving the notorious "nine-dots problem" where nine points must be connected together by a pencil line without lifting the pencil off the paper. 5% of the population can do this but, if you stimulate the left brain with a low electrical charge and depress it, 39% did it.

Sheen and Asner want to boycott--with awards as well--the film "Zero Dark Thirty." This is a very strange thing. Kathryn Bigelow's defense in an L.A. editorial is simple and obvious: Her defense is that depicting torture does not condone it. So what is the problem? Ugly and immoral violence? Quentin Torentino won a scriptwriting award! As torture is excessive in the minds of most civilized people it is hard to say if the scenes are excessive but the problem remains: What are the objectors objecting to? Not that it happened. Not that it was a component of the story. Not that we have "rendition" sites where we outsource torture we are not willing to do ourselves. Could it be that torture stains the achievement of the current administration in killing bin Ladin and that the entertainment industry, led by their most vociferous and outspoken representatives, will not tolerate that? Even if it means criticizing speech? The speech of their own art?

The National Climate Assessment states that temperatures in the USA are already up 1.5 degrees from the average temperature during 1900 to 1960. Sea levels are already up 8 inches since that time too. The length of the frost free season has grown by up to 21 days, This is a government group. The Intergovernmental Panel on Climate Change (IPCC)--another governmental group--estimates that the earth’s average temperature will increase somewhere between 1.1°C and 6.4°C over the 21^st century. How much of the IPCC’s projected 1.1°C to 6.4°C of warming will the U.S. be responsible for in the next century? The answer is about 0.08°C of the low end estimate and about 0.35°C of the high end estimate. Using the IPCC’s mid-range scenario, carbon dioxide emissions from the U.S. contribute about 0.19°C of the total 2.96°C global temperature rise. So, are we going to get tough with the biggest environmental offender, China? That could be dangerous but do not worry; the people who are concerned about this warming are not just picking soft targets. They are willing to suffer anything for their beliefs. Right?

To make up for lost revenue, Washington state will be charging residents who own fuel-efficient vehicles an annual tax of $100. The state has decided that electric car owners need to "contribute their fair share to the upkeep of our roads," says Washington State Senator Mary Margaret Haugen who sponsored the bill.

14% of Mercury in Great Lakes Comes from China

Golden Oldie: http://steeleydock.blogspot.com/2012/07/greatest-inequity.html

The U.S. will surpass Russia and Saudi Arabia this year to become the largest producer of liquid fuels, BP Plc said. Liquids output, which includes oil, natural gas liquids and bio-fuels, will be boosted in the U.S. by tight oil extracted by the same technology that sparked a boom in shale gas. The IEA said the U.S. will become the world's biggest oil producer for about five years starting in 2020.

The "fiscal cliff" legislation sends about 165 million dollars to railways. And short line and regional railroads are allowed to claim a tax credit for 50 percent of the cost of infrastructure improvements, up to $3,500 per mile. Wow, Buffett really got lucky there.

New coal capacity built in 2012 rose 135%, jumping from 1,932 megawatts in 2011 to 4,510 in 2012. While existing coal plants lost market share in 2012, coal had a relatively good year in the new generation market and accounted for about 17% of all new power plant capacity built in the USA last year. Their capacity is up and they are losing market share.

The former chief of the U.S. Anti-Doping Agency says a representative of Lance Armstrong's offered the agency a donation in the range of $200,000 to $250,000 in 2004. Armstrong denies it. Hypocrisy or lying? Does it really matter? If the government wanted to create something the nation really needs it should be a Bureau of Heroes.

AAAAANNNNNNDDDddddddd.......a chart:

Politician vs. the Dreaded Numbers Villian

The Guardian website has an upbeat quote from Norman Baker, Liberal Democrat Under-Secretary of State for Transport, about the future of the government's Electric Vehicle subsidy plan. ‘I know electric vehicles have a bright future in this country’ he says, citing new models due this year, including the relatively inexpensive Renault Zoe and the Sunderland-built Nissan Leaf.

However the Guardian website's figures for the numbers of new cars registered under the British Government’s ‘Plug-in’ Car Grant plan are not as optimistic. This program gives buyers 25 percent off (up to a maximum of £5000) the price of a rechargeable electric vehicle such as a Chevy Volt, Toyota Prius plug-in or Renault Fluence. The program is now two years old. According to the Department for Transport figures, 1419 cars were registered under the plan in the first nine months of the 2012 up from 786 in 2011. So it looks as if all of 2012 will see around 1900 rechargeable cars bought, out of the two million news cars that left UK showrooms.

Fun with Numbers

 

 

 

In 1981 a report, commissioned by President Carter to assess gun violence, was published in several

volumes titled, strangely, "Under the Gun" which concluded that there was no connection between

gun control laws and gun crime. The landmark federal Gun Control Act of 1968, banning most

interstate gun  sales, had no discernible impact on the criminal acquisition of guns from other states,

Detroit’s law providing mandatory sentences for felonies committed with a gun was found to have no

effect on gun-crime patterns, and Washington, D.C.’s 1977 ban on the ownership of handguns

(except those already registered in the District) was not linked to reduction in gun crime in the

nation’s capital.

In 2004, the U.S. National Academy of Sciences released its assessment of over 400 journal articles, books government publications and some original research. The conclusion was there was no evidence that any gun control reduced violent crime, suicide, or gun accidents.

The results of a 2003 study by the Center for Disease Control was the same.

So now comes Mr. Obama with his 23 "executive actions" which include: “Issue a Presidential Memorandum directing the Centers for Disease Control to research the causes and prevention of gun violence.” This new study will do what? Break new ground? Turn over new rocks? Reassess old ones? Perhaps avoid uncomfortable real conclusions?

This is a metaphor for the culture. We have an undeniable problem. The factors involved are not clear. Some of the popular and obvious factors have been shown not to be significant. But we allow our prejudice--a word meaning "pre-judge"--to trump our need for accuracy and we follow our prejudgment to some conclusion. This allows us to feel righteous and accomplished. It also allows us to diminish those who prefer more accuracy.

Years ago I sat in a serious business meeting with some serious analysts looking at the question of information and input. Debate raged over the significance of our gathering method when the chair of the meeting stopped the debate. He shouted, "Bad data is better than no data at all!" He then adopted the disputed data. The table fell silent and remained so. Everybody in the room knew the chairman, who eventually became president of the corporation, was either over his head or insincere.

"Raise the Drawbridge"

Dan Pfeiffer, head of the West Wing's communication staff, expressed the current mood in the West Wing this way to the Washington Post on Inauguration Day: "There's a moment of opportunity now that's important. . . . What's frustrating is that we don't have a political system or an opposition party worthy of the opportunity."

Exactly what is "unworthy?" The Republicans? The system of checks and balances? The Constitution? The thinking of Madison and Jefferson and Hamilton just getting in the way of your mighty brains?

At the time of the economic crisis in the fall of 2008, the economic system was falling apart and the Congress, the leaders of the country, were going on vacation. They had a good reason: Senate Majority Leader Harry Reid said "No one knows what to do." When the going gets tough, the tough go on vacation.

One might ask, "What has changed." Why, when the nation was experiencing one of its most significant problems since the Second World War, would the nation's leaders just walk away and now think they are so capable of dealing with an admittedly vague but apparently significant "moment of opportunity?"

State of Fear

A great fear of the average thinking citizen is that the state, through either incompetence or malice, will, through action or inaction, cause terrible and lasting damage upon the citizenry. Wars, budgets, debt and deficits are the easiest of such blunders with their consequences of murder and more. A solution is to limit the influence of the state as much as possible, a position abhorred by those who feel the state a positive influence with more benefit than danger. Anyone with a knowledge of American military combat from Korea to the present might have a difficult time having any such optimism.

The absurd "fiscal cliff" is a real example of such a threat and a virtual metaphor of the disconnection between the government and its citizens. The nation is readily threatened for the smallest political gain, the harmony of society easily disrupted for the sake of posturing and posing, the country eagerly misled by counterfeit principles. We will soon face the equally absurd "debt ceiling."

The thesis behind Crichton's "State of Fear" was only incidentally concerned with global warming; it was that politics have evolved so that no political action is possible unless the poor citizens is scared witless by the alternatives facing them. We may have progressed beyond that. We may be just scared witless of these so-called leaders and the people who have faith in them.

Currencies and Gold

The tug-of-war over the currency continues to be played out in precious metals. The government prints money to prevent illiquidity, illiquidity being an agreed upon evil learned from the Great Depression. Using the logic that availability and price are inversely related, people assume the value of the dollar will drop as we are printing a lot of them. Consequently they buy precious metals, particularly gold and silver--but some platinum and palladium, purchases that are buttressed by some industrial use so that there is a commercial demand as well as an assumed value demand. These metals are their hedge against a perceived decrease in value of the currency, i.e. the dollar.

A problem here is how perception influences value. We perceive the dollar as less valuable and metal as more so. But why? Metal is only one place to put money. What if the dollar is perceived as the best of all, admittedly failing, currencies? Would that result in people leaving those currencies, euro or baht or wampum, for the dollar? Would that result raise the value of the dollar?

There are examples in history of currency unrest in this country. Andrew Jackson was a sworn enemy of banks, particularly central banks. For him it was a question of placing too much power in the hands of the Federal government, interfering with individual contracts and using a currency that had no intrinsic value. Before he left office he refused to renew the charter for the Second Bank of the United States, the country's central bank. As a result individual states and banks began printing their own money. And so did many enterprising crooks. When his vice-president, Martin Van Buren, succeeded him, he wanted to retire the government debt. He decided to sell government land to do it but ordered the treasury to accept only gold or silver as payment. This became known as The Panic of 1837. Inflation soared, the markets declined and the country experienced a seven year depression.

By the 1850, one half of the circulating currency was counterfeit.

One could imagine a scenario where penicillin might be priceless. Or handguns. Or a GPS. Totally reasonable appearing people will pay $10,000 for an unusual book. Flea markets have small, cluttered tables of things of value to some, not to others.

Value is subjective. In currency, perception is reality. That may be helping now but it has a serious downside.

Sunday Sermon 1/20/13

Today's gospel is the Marriage at Cana, a gospel with something for just about everyone. Motherhood, families, marriage contract, filial responsibility--even vintners get a spiritual nod.

Yet there is another element here: Respect for the everyday. Here Christ, the gateway between the New and the Old Testament, is spending his time at some peripheral social event. And then the dingbats run out of wine and He, with a lot on His mind certainly, is asked to fix this annoying social problem. It is almost a trick He is asked to perform. But He does it. And He creates a good wine, something everyone will enjoy.

The point seems to be that the disciples are impressed. And, while that is likely, there is something else, something wonderfully human, that Christ affirms here.

Cab Thoughts 1/19/13

When school children start paying dues, I'll start representing them.--Teachers Union Representative

The Russian psychologist Alexander R. Luria, who wrote about the man in The Mind of a Mnemonist who could remember anything and for long periods. Speeches, formulas, anything and for years. He did, however, pay for it with remarkable indecision and lack of focus. He could not make sense of stories as each word raised countless connections and associations that crowded his attention off the topic. It seems that forgetting is an art, an important act of the brain that eliminates depression, dwelling on the negative and obsessive thoughts. More, it allows you to carve out the important; it allows you to act. Reminds me of that quote by Jack Nicholas during an interview: "Actually, I don't remember ever hitting a slice."

Lincoln said "if slavery is not wrong then nothing is wrong." At the same time he felt the Constitutional requirement to return a fugitive slave could not be avoided.

Why are entrepreneurs so evangelical?

In over 110 amateur fights, Cassius Clay was only knocked out once. Kent Green  knocked him out  in the third round, a technical knockout. Green was 14 and 2 as a pro.

Maryland's Gilman High School has a successful football team with some unusual rules. One is that no Gilman student, football player or not, is allowed to eat lunch alone. This is a speech the team's coach, Bill Poggi, made as related in Jeffrey Marx' book, "The Season of Life":

"'The rest of the world will always try to separate you. That's almost a law of nature -- gonna happen no matter what, right? The rest of the world will want to separate you by race, by socioeconomic status, by education levels, by religion, by neighborhood, by what kind of car you drive, by the clothes you wear, by athletic ability. You name it -- always gonna be people who want to separate by that stuff. Well, if you let that happen now, then you'll let it happen later. Don't let it happen. If you're one of us, then you won't walk around putting people in boxes. Not now. Not ever. Because every single one of them has something to offer. Every single one of them is special."

A talented performer like Jodie Foster should be able to express herself more coherently than she did at the Golden Globes. If her concern is privacy, state it. A cute and teasing speech, hinting at her sexuality which she is apparently trying to keep private, made the entire unrewarding moment an oxymoron. She was being given an award, an award I think she deserves. The first thing to say is "thank you." If you plan to use the moment as an opportunity to raise unrelated points, you do so at your peril. At least the intrusion should be understandable.

This week is the anniversary of the end of the British retreat from Kabul in January of 1842. 4,500 troops under the leadership of the lightly regarded General William Elphinstone, along with 12,000 civilians (women and children) left for Jalalabad, 90 miles away, after the murders of the two British representatives in Kabul. They believed they had been offered safe passage through the snowbound mountain passes. During the next seven days, with various insincere offers for peace and truce, the Afghans systematically cut the unit, women and children to pieces. The final British stand was at Gandamak. On January 13, one survivor arrived at Jalalabad: Doctor Brydon, a military physician with a significant head wound.

We always recover from disasters. Somehow. Resilience is built into us.

In 2012, the average wholesale price for spot market day ahead electricity fell from 15% to 43%. Some was the price of natural gas, a bit was alternative sources but much was efficiency off the grid.

14 to 25 percent of purchased food is discarded unused.

Between 1951 and 1997 the proportion of British government expenditure on defense fell from 24% to 7%, while the proportion on health and welfare rose from 22% to 53%. Partly this was due to America's accepting the international military role but partly it was due to an inherent shift necessary for funding health care.

Is it just a given that people in Kansas should pay for damage done by a storm in New Jersey?

Bedbugs were virtually eliminated from North America after the Second World War by DDT. They reappeared around 2000.

From the late Barton Brigs' new book, "Diary of a Hedgehog:" Commodities are "not an investment. An investment by definition is either current income or a stream of future income. When you buy a commodity, you have to be assuming that you are going to be able to sell it at a higher price to someone else, because it has no income. Thus, it is not investing — it is speculating.”

It is estimated that the current remade hockey season, if each play-off goes the distance, would end in mid-June.

Golden oldie on income disparity: http://steeleydock.blogspot.com/2011/12/income-disparity-and-its-discontents.html

China is the largest car market in the world. China's air, during Sunday and Monday, had soot readings that were close to 900 ppm per cubic meter or 36 times safe levels. 

The EIA Residential Energy Consumption Survey shows homes built from 2000 to 2009 are about 20% more efficient per square foot than homes that were built 30 years ago.

Deaths before age 50 accounted for about two-thirds of the difference in life expectancy between males in the United States and their counterparts in 16 other developed countries, and about one-third of the difference for females. The countries in the analysis included Canada, Japan, Australia, France, Germany and Spain. Gun violence, auto accidence and drug overdose led the factors.

Bullet points from a new KPMG paper on automobiles:

• Enthusiasm over electric cars wanes, with petrol engine cars and hybrids set to dominate over next decade
• Fuel efficiency is the number one priority for cash-conscious consumers
• Brazil, Russia, India and China (BRICs) market share predicted to edge near 50 percent, with 4x4s the fastest growing segment
• Car sharing or ‘pay on use’ could be the answer for growing urban areas, and an opportunity for new players
• Emerging markets trend toward upscale vehicles; in mature markets: downsize
• Traditional dealership model under threat as online activity grows

Who is Elizabeth Keckley?

Getting regenerative energy from braking systems is efficient in EV or hybrids because the electric motors are already there. But a traditional internal combustion engine has only a mechanical drive train. Adding electric motors for regenerative braking is a commitment to more weight, more cost and more complexity.

AAAAAAAAANNNNNDDDDdddddd.....a graph:

American Pooka

These are the times that try Piltdown Men's souls.

Te'o had a girlfriend badly hurt in an auto accident who died of leukemia.
Armstrong never used performance enhancing drugs.
Neither did Barry Bonds.
Climate scientists never falsify data.
Your taxes will not go up.
Petreaus is a man of integrity.
When the new administration takes office, we will end Guantanamo.
Jayson Blair reporting from The New York Times
I did not have sexual relations with that woman, Miss Lewinski.
Stephen Glass reporting from The New republic.
Gunter Grass, a Nobel laureate, was a spokesman for his post-war German generation and constantly demanded they face the truth of that time.
Julie Amparano reporting from the Arizona Republic
Obama might be an illegal immigrant
Johann Hari reporting from The Independent
"A higher education is the surest route to the middle class"
Romney might be a felon
Michael Finkel reporting from the New York Times Magazine
One year before the Russians started Biopreparate, they signed the U.N. bio weapons non-proliferation treaty.
David Chalian, reporting for Yahoo! News
The Interstate Recognition of Notarization Act, passed by both houses of Congress, formally legalized the fraud and forgery performed by the mortgage mills trying to standardize the subprime loans.
"If you're going to do health-care cost containment, it has to be stealth."-- Jon Kingsdale, speaking at a conference sponsored by the New Republic
Dr. Wakefield attacked vaccines while working for plaintiff attorneys suing vaccine manufacturers.
We will not take 500 billion dollars from Medicare.

Periods of art are often defined as to the culture's ability to stand reality at all. This may be one of those times. But not in the minds of the liars, in the minds of their victims. Perhaps this world, its problems and our collective failures are just too much for us and we want to stop struggling with it. As we no longer notice TV broadcasters' grammatical errors, perhaps the truth of these awful problems makes us indifferent to the terrible lies.

A few years ago there was a lovely movie called "Harvey," made from a play by Mary Chase. In it, a nice, bumbling man, Elwood P. Dowd (played by Jimmy Stewart), deals with friends and relations who want to disabuse him, then cure him, of his belief that he has, as a close and constant friend, a six feet three inch invisible rabbit named Harvey. This rabbit was an enjoyable and reassuring companion. He could also stop time.

"Years ago my mother used to say to me, she'd say, 'In this world, Elwood, you must be' – she always called me Elwood – 'In this world, Elwood, you must be oh so smart or oh so pleasant.' Well, for years I was smart. I recommend pleasant. You may quote me."--Elwood P. Dowd

On the Road to Jalalabad

This week is the anniversary of the end of the British retreat from Kabul in January of 1842. 4,500 troops under the leadership of the lightly regarded General William Elphinstone, along with 12,000 women and children (and some merchants)  left for Jalalabad, 90 miles away, after the murders of the British representatives in Kabul. The British representative, Macnaghten, had offered to make Akbar Khan Afghanistan's vizier in exchange for allowing the British to stay in Afghanistan, while simultaneously planning to have him assassinated, plans that Akbar Khan discovered. A meeting for direct negotiations between MacNaghten and Akbar was held on 23 December, but MacNaghten and the three officers accompanying him were murdered by Akbar Khan. Macnaghten's body was then dragged through the streets of Kabul and displayed in the bazaar. Elphinstone took this as a bad sign and the British negotiated safe passage, they thought, through the snowbound mountain passes to Jalalabad.

During the next seven days, with various insincere offers for peace and truce, the Afghans systematically cut the unit, women and children to pieces. The final British stand was at Gandamak. On January 13, one survivor arrived at Jalalabad: a Doctor Brydon, a military physician with a significant head wound.

At the height of the Empire, the British were vulnerable in far away lands to groups with relatively inferior technology and organization.

The British have long regarded this event as evidence of Afghan untrustworthiness. (MacNaghten's treachery was apparently understandable.) But one does wonder how people recover from these disasters. How can the British just soldier on? How does an event like this not stain their psyche, interfering with every negotiation and international encounter? How do national blood feuds not develop? How can the Americans become trading partners with Japan after the Pacific war? How can the Vietnamese do the same with the Americans? Is it forgiveness? Or are these large and national events quite separate from us small individuals, like some sort of national epidemic that burns itself out like the flu or the Plague, and the individual does indeed soldier on, scars and all, grateful to have survived.

profits and wages

There is a weed amongst the debt and deficit rubble.

Since 1947 (when the data was first compiled), corporate profits as a percentage of gross domestic product are now at their highest level, while wages as a percentage of GDP are now at their lowest level. Corporations reacted to the growing threat of their expanding overhead by paring its workers, finding cheaper workers overseas and improving its distribution lines. Workers were laid off, Internet stores replaced brick ones and good, experienced workers were displaced to find work elsewhere at entry level pay. It was not a question of making the economy more efficient -- corporate reorganization did that -- it was a question of where the value accumulated. Business prospered; workers suffered.

The U.S. is now facing a difficult time. The under-employed and unemployed are living in a world of rising disparity; the nation is richer and they are not. This violates a basic American assumption: When wealth grows, all are supposed to indirectly benefit. A richer farmer should imply the city family eats better. The richer pharmaceutical should imply the citizen is healthier. The influence of success is more muted now. Less people benefit from success.

One argument is contentment is cheaper. Like everyone's thirty year old child, there is only so much one needs after a while. People are not buying homes as their parents did, they are renting. Some are not buying cars, especially new cars, and a new industry of "as needed" car rental has emerged. Smart phones reward people. A good TV makes up for a half filled closet and a good monthly cable package costs less than a hockey ticket.

But that may not be enough for politicians who live in a quid pro quo world. One solution is to tax the producers and give money to the non-producers. The problem is that everyone knows, even the politician, this may kill the goose. That money they take and redistribute will not be cycled through the investment world and will be lost to the possibility of long term growth for the sake of temporary and short term consumption. The results there could be even worse.

Regrettably this will require some study by serious and honest people and some hard decisions will have to be made. Who on the political horizon can do that? A congress without any ability to articulate any coherent opinions? A president whose notion of policy is to put yellow stars on the lapels of outrageously rich people?

The question now is: Quo vadis?

Stocks for the Short Haul

Crestmont does some interesting data collections. Here are two similar topics with different formats. The question is, with the known long term biases toward stock investment over the long term as championed by Jeremy Siegel, how do stocks do in the shorter run, like for retirement plans?

Here they evaluate ten year segments--annual returns over every ten year period since 1900. These are daunting. Look just at the period from 1900 to 1912. If you bought in 1900 or 1901, your returns would have averaged over 21% for ten years. But buying one or two years later and your return is less than 8%.






And groups of annual returns over the same period. 21% of years lost more than 10%, and 32% ranged from a 10% loss to a 10% gain. Dangerous if you are not in for the long haul.

Doug Millar's Funeral

I went to Doug Millar's memorial service today. He had a long illness (adrenal-cortical carcinoma) and died last week. He was a nice guy; I knew his wife a bit better, a sharp and interested woman and radiologist.

Doug worked in his own specialty travel business. He was famous, though, for his successful lawsuit against his broker over the broker's failure to sell his significant holdings in FreeMarkets, a request Doug made at a golf outing and the broker thought was musing, not an order.

The crowd filled the church and was quite involved, moved and upbeat. There were sports people, politicians, lawyers and businessmen. One girl who was or will be in a Breck commercial.The eulogy by a friend was excellent. It started as a make-believe phone call from Doug and could be sold as a short story. The minister, another friend, gave good sermon.

Generally, it was very well done, moving but uplifting.

It made me think of my funeral and how I must make new and more creative friends. And join a smaller church.

Sunday Sermon 1/13/13

In today's gospel, Christ is baptized by John. It is a difficult, awkward moment for John--and perhaps for Luke who mentions the baptism only in passing and emphasizes the appearance of the Holy Spirit. In the very next paragraph Luke says, beginning a genealogy of Christ, " And Jesus himself was beginning about the age of thirty; being (as it was supposed) the son of Joseph..."

"As it was supposed."

In Mathew when John expresses his embarrassment in baptizing Christ, Christ says, "Suffer it to be so now." It is a rare moment where Christ approves of the ritual of thing. Relax, he is saying. The complexity of this is just starting. This drama is over the audience' head. I know you have lived in the desert and are a very serious guy but don't take everything to heart.

Cab Thoughts 1/12/13

“As the saying goes, if you give a man a fish, you feed him for a day, but if you teach a man to fish, you feed him for a lifetime. Community organizers like Huerta don’t teach anyone how to fish: they teach activists how to steal their neighbors’ fish. This is what Huerta and her ilk call social justice.” --Matthew Vadum

A recent interview by Stephen Moore with Boehner revealed Obama thinks the debt problem is related to health care costs and health care exclusively. Sort of Ewe Reinholdt on steroids. Apparently he gets testy when people try to blame it on additional causes.

In the Canterbury Tales one of the characters in 'The Squire's Tale' wakes up in the early morning following her 'first sleep' and then goes back to bed. Some researchers believe that, in the absence of artificial light, this sleep pattern where there is a first four hour sleep followed by a meditation-like period then a less efficient second sleep of variable time is the way we would sleep under ideal conditions. But medicine views interrupted sleep as pathological and medicates it when possible.

Hilary's physician used a very peculiar phrase re: her health. He said it would be the same as before. Never heard it phrased that way.

Nissan Motor Co. said it will begin U.S. production of its all-electric Leaf on Thursday in Tennessee as part of a $1.4 billion government loan. Leaf sales were to double last year but were up only 1.5%. A 1.4 billion dollar loan from your friends and neighbors can make up for some shortfall, though.

 
Oil production in North Dakota is up 52% year to year. In Texas it is 31%. Yet this will mean little to the American consumer because the oil cannot be moved to U.S. sites or is of too high a quality to be refined here. The regulations will not allow either. When one thinks of the complexities we are victims of, this kind of governmental self-induced deprivation is hard to stomach.

Planned Parenthood received $542.4 million in “government health services grants and reimbursements,” including “payments from Medicaid managed care plans.” Their assets are 1.2 billion dollars.

The median household income of Americans in 2011 was $49,103. Adjusted for inflation, the median income is just below what it was in 1989 and is $4,000 less than it was in 2000. This is more than stagnation; this is the erosion of a basic idea in America, that success breeds success. Now it may be we need less. People seem content without cars, or two cars. Electronics seem to make life fuller and perhaps this will make up the difference. But this is happening, not with any real understanding or control, just happening. And the bathoeic politicians who want to rule, see redistribution as a solution. Because all the components in the GDP equations are the same to them.

Apache Corp this month is set to become the first company to power an entire hydraulic fracturing job with engines running on natural gas, cutting fuel costs by about 40 percent.

Panasonic has a new TV called "my home screen" which makes individual suggestions for TV and Internet from your preference history. It has a camera that recognizes you. You can buy a TV with a camera that knows who you are and watches you.i

BYD Co Ltd, a Chinese maker of electric cars and batteries, said that it has received permission from the European Union to sell electric buses in all of bloc's member countries. Buffett bought a big piece of this company because Munger liked it so much. The company has not done well.

So the Americans are too "procedure oriented" in their medical care. Physicians earn more money by doing more work. So, let's do more than not rewarding them for more work, let's reward them for less work. Sort of a medical soilbank; the less you do , the more you earn. Very cost effective.


The sea otter is covered in a sensationally lustrous and soft fur coat that is the densest of any mammal, with as many as one million hairs per square inch. It was originally found by Cook's expedition and brought to China, somewhat by accident, by sailors who used the pelts. Trade developed that, by itself, covered the trip to China and, sometimes, was worth a fortune.

The Justice Department announced it would not prosecute HSBC ( The Hongkong and Shanghai Banking Corporation ) for enabling Mexican drug gangs to launder money, and helping Iranian interests to evade U.S. sanctions. Instead, it offered a settlement in which the bank would pay a fine of $1.9 billion—about four weeks’ worth of its pre-tax profits. They said they were concerned about bank and financial stability. Too big to fail, too big to prosecute.

Who was Edmund Ross?

A Nobel Prize winner in economics recently reviewed the disparities between the American and other workers and their working hours. Americans generally work longer and harder. His conclusion: Marginal tax rates. As rates rise, work effort drops. That is not terribly surprising but it is interesting to hear an officially smart person say it.

6% of purchases at Amazon, 15% at EBay and 60% at Walgreen Pharmacy last year were made and paid for with smart phones.

Golden Oldie: http://steeleydock.blogspot.com/2010/11/happy-meals-and-american-way-of-life.html

The U.S. won the world Junior Hockey tournament and the goalie, the MVP, was second string on his high school team.

It is estimated that 40% of wolves are killed by attacks by enemy packs. This is a far cry from Konrad Lorenz' thesis that the ability of a species to kill contained a reciprocal demand not to. His thesis raised real anxiety in the 70's as it was felt that hand-to-hand attacks were off-set by inhibition where attack by technology--gun, bomb, arrow--was guilt-free.

Gas generated 30.3% of America's electricity, a sharp increase compared to the 12% in 1990 or 16% in 2000. Coal provided 37.6% of the nation's power, sharp declines from more than 50% 15 years ago, 48% in 2008, and 43% in 2011.

AAAANNNNDDDdddd........a graph. This is not particularly informative as the time divisions are arbitrary but it gives some general idea:

	1970s	1980s	1990s	2000s	2002-2011	Worst One-Year Return
100% stocks/0% bonds	5.9	17.6	18.2	-0.9	2.9	-43.3
70% stocks/30% bonds	6.0	16.5	15.5	2.1	5.2	-32.3
50% stocks/50% bonds	6.0	15.5	13.6	3.9	6.5	-24.7
30% stocks/70% bonds	5.9	14.5	11.7	5.5	7.7	-17.0
0% stocks/100% bonds	5.5	12.6	8.8	7.7	8.9	-14.9

Source: Ibbotson Associates

Jack Lew and You

Jack Lew is Obama's new nominee for Treasury to replace the semi-esteemed Geithner. According to the news release on Yahoo, Lew "doesn't have the type of financial experience that Geithner brought to the job at the height of the financial crisis in 2009. Indeed, there's not as much of a premium on those skills now as the nation's attention has turned from bank bailouts to fiscal confrontations and brinkmanship." Bloomberg said that a significant under-secretary may have to be brought in as well as Lew was "a little thin" on finance.

So the Secretary of Treasury will be headed by a guy a little thin on finance. A surgeon a little thin on anatomy. A papal candidate light on theology. Eric Holder. Obama himself. Do you feel taunted? Are you getting the feeling that a good understanding of the job is an incidental requirement in this administration? That maybe something else is afoot?

That defiance and hubris may be the point?

Gun Science

Some gun legislation will come now. People are upset. The debate has slipped, as it always does, to special interests and high-minded men. The politicians have, or will have, a "good idea." When people want opinions, they will call on special interest groups with specific tax advantages. The Second Amendment will be defended by the NRA.

In 2004, the U.S. National Academy of Sciences released its assessment of over 400 journal articles, books government publications and some original research. The conclusion was there was no evidence that any gun control reduced violent crime, suicide, or gun accidents. The results of a 2003 study by the Center for disease Control was the same.

Studies by countries with and without gun laws, with mild or severe constraints and with comparative results over changing laws and changing time show consistently that violence is influenced mainly by social and economic factors; the change in laws changes only the weapon of choice. The notion that guns protect citizens is not borne up consistently in the same studies either. The idea that guns allow the ordinary citizen an outlier moment where he kills or maims in a momentary and atypical fashion is not the case; virtually no murderer is an "ordinary citizen" but rather a habitual lawbreaker of violent character. (In the Harvard Review where these studies were collated the recurring description was "aberrant.") Indeed, violence in ordinary families is infrequent.

So what is the origin of our rush to legislate when gun violence occurs? A major factor is our refusal to accept evidence for what it is and the humility it implies. We bull our way through limited studies with limited conclusions in a frenzy of desperation to make some difference somehow. That and a remarkably primitive willingness to accept imitative magic, confident in fine-tuning neutral circumstances.

 

After all, when a comet appears, something important is happening somewhere.

But there is another, less whimsical element. We do not want some people to be worse than others. We want circumstances to differentiate us, not essence. There is a fear that, if some people are truly different, truly hostile to our peaceful way of life, the social structure itself will fail, a belief that is almost the direct obverse of reality.


So we intervene to intervene, confident in our good intent and blind to the destructive placebo we give ourselves in the place of true understanding.

 

The Edge and Core of Science

Science requires confirmation. Where there is no confirmation, or where confirmation is not theoretically valuable or accurate, one often sees volume substituted. For example, global environmental studies of the earth's temperature are necessarily limited; there have been only a few regular and continued measurements sites for the last four or five generations and those sites have been limited. Consequently, in the place of meaningful data, numbers are substituted. For this reason one hears "consensus" rather than "confirmation." There is simply no way to torture meaningful data out of the few data points available.

It is at this time one hears scientists start whispering "soft science." There are some areas of investigation that just do not provide us with enough meaningful data to justify meaningful conclusions. But they try. The social sciences are good examples. How can one analyze the musings of Freud or Jung? What studies would confirm their theories? And the anthropologist, how does he come to a thesis and a conclusion? Looking for repetitive and predictable behavior patterns begs the question in the true meaning of the phrase. The conclusion is the observation is the conclusion.

And there is another element, the element of the individual. How does the group change him and does that change skewer the information. Emergent behavior like the flocking of birds is entirely unrelated to individual bird behavior yet it is quite distinctive. Is the beating heart of man in the city? On the farm? On the porch?

One huge difference is that science discards the outlier, yet the outlier might be the story. A mob killed Lavoisier; where would the social scientist look? He would look at the mob; Lavoisier would be an insignificant outlier. Edison? Napoleon? Lincoln? All would be rejected as not being representative of us.

It diminishes us. It misses our point.

Which is why we have Art.

The Wise Men of Gotham

“Family friends and supporters says (sic) Chelsea Clinton, who has evolved from a frizzy-haired little girl in the White House to a self-assured public figure in her own right, is ready to play an increasingly larger role in the national debate and may emerge as a pre-2016 surrogate of sorts as her mom mulls her future plans."--Politico

Really? Seriously? One could, of course, argue "how could we do worse." Between the Republican rubes, the Democrat enthusiasts and an electorate confused over the difference between the definitions of "politician" and "leader" it might well be that the state should be run at random. Indeed, perhaps we could pick legislators like we do jurors and sentence them to two or six years of government service in the Congress. Or perhaps my old fallback position, Angelina Jolie; if competence is not on the table, they might as well be good looking.

Chelsea Clinton. Jenna Bush Hager. Jeb Bush. For that matter, the second George Bush. Who are these people? When did political office get congenital? Or venereal? When did these nonentities begin to think they were the John Adams family? Or will the government eventually become a reality show run by celebrities?

Or might this be a plot. Could we be looking at a huge political conspiracy to simply loot the State by slowly bleeding it, keeping the golden goose alive, but barely, as the kleptocracy, cleverly disguised as politicians dressed like statesmen, shovel away their riches and then move on, leaving the gasping State body drained and immobile for the next generation of impostors?

Lincoln: A Review

At the movie's beginning, two black Union soldiers talk with Lincoln on a battlefield. One is plainspoken, the other calculating, one thrilled with his new life the other resentful of the new world's limits, one content with his current success the other impatient for advancement, one of simple knowledge while the other had memorized the Gettysburg Address. These two are brilliantly organized to present the theme and mood of the movie where disparate but not divergent or antagonistic elements are constantly in play.

The focus is the 13th Amendment vote in the Congress, a vote that might be sidetracked by the South's surrender. Politics and idealism, war and peace, men and women, black and white, cynicism and optimism, rural and city, homespun and abstract all come to meet on the delicate blade of the "here and now."

Day-Lewis is wonderful as Lincoln, complex, troubled, conflicted but with a great understanding, kindness and vision that transcends the political debate and the military conflict. Field is brilliant as Mary Todd Lincoln, a woman filled with ambition and sorrow made deeper and more understandable but no more likable than any other portrayal. And the support is excellent, uncanny in appearance and refined in focus. But the star is Spielberg whose genius brings this massive collage--all parts self-consciously aware of their own importance--together for human and humane debate in the "here and now."

When I got up to leave two big, middle-aged men stayed along with me to watch the credits scroll. In the middle of the credits a young woman came in to the almost empty theater to clean under the seats and pick up loose bags and popcorn. As the two men left, each tipped her, to her likely eternal astonishment.

It was that kind of movie.

Sunday Sermon 1/6/13

Today the Wise Men come to Bethlehem. It has always been a focus of interest because of the "star" they followed to the stable. For some reason this literalism is important to people, mostly skeptics, when the huge implications of the story are ignored.

In this gospel Herod, the Jewish king, conspires to kill the Christ child and the Wise Men, non-Jews, come to worship Him. The local Jewish shepherds come first, then the Wise Men--with the murderous leadership in the background. This early gospel is a virtual metaphor for the entire New Testament.

The inclusion of the Gentiles in those who can be saved, a notion that some attribute to Paul and not Christ, is shown here, in the Wise Men, at the very start of Christ's appearance.

Cab Thoughts 1/5/13

One ought, every day at least, to hear a little song, read a good poem, see a fine picture and, if it were possible, speak a few reasonable words. -Johann Wolfgang von Goethe, poet, dramatist, novelist, and philosopher (1749-1832)

Sometimes the smallest things have importance as indicators. One of these small things: Robert Parker is selling a controlling interest in "The Wine Advocate" newsletter to businessmen in Singapore. The move reflects the tilt of fine-wine sales to the Far East and Southeast Asia as economies expand and consumers develop a taste for conspicuous consumption. Parker has been responsible for so many changes in the world of wine--some perhaps worrisome like his numerical rating system. But he was a remarkable influence. It is an astonishing change in the wine world.

How could I know more about Kim Kardashian's baby than I know about Hilary Clinton's stroke?

Pearl Buck's older sisters, Maude and Edith, and her brother Arthur had all died young in the course of six years from dysentery, cholera, and malaria while their missionary parents were in China.

The average age of Americans' cars is 10.8 years

This new finance bill is filled with advantages for the usual suspects. Cleaning this up is not hard, it just is not on anyone's agenda. The Senators even voted down, 14-10, an amendment to list the corporate interests that receive tax perks on a government website. Voted listing the bill's beneficiaries down! Shameless.

One of the unexpected revolutions in the world of energy has been the U.S.' sudden explosion in natural gas production. We may be exporting it in a few years while prices as well as imports have dropped, amazingly without government subsidy. However, where there is success there is a predator. Fracking technology is driving America's oil and shale-gas boom, yet a White House executive order from April directs no fewer than 13 federal agencies to consider new regulations on fracking-although it is already regulated by the states.

An interesting social/religious custom was reported by Marco Polo in small villages outside of what is now Beijing. The small towns eagerly shared their women, wives and daughters, with travelers. (This actually brought the wrath of the Khan down on them until they bought him off.) This apparently is a well-established custom of the region and an exception to 'village endogamy,' in which the people of the same community intermarry to preserve assets and bloodlines. Endogamy brings with it the hazard of incest and birth defects. Exogamy, or marriage outside the clan, refreshes a depleted gene pool. If the outsiders were nomadic, as Marco suggests, the replenishing of the gene pool would be accomplished without challenging the existing order. Much of Europe at the time was very heterogeneous with isolated villages that did not even speak the language of the neighboring villages. I wonder how they escaped this "endogamy."

The very well regarded writer George Saunders graduated from the Colorado School of Mines and, after, went to work for an oil-exploration company in the jungles of Sumatra.

The new anti-fracking movie, poorly disguised as a drama, with Matt Damon, was funded by Middle East money. This agitprop approach has always been around but now it is getting pretty raw. The lack of subtlety cuts two ways: On one hand it's easy to see, on the other it clearly doesn't matter to the propagandist who thinks most will not look hard or care.

Social Security ran a $47.8 billion deficit in fiscal 2012, drawing in even less than it paid out last year, with just 1.67 workers supporting each retiree. The number of retirees and disabled using the system grows by 10,000 people a day.

Both Chile and Galveston,Texas have pension funds that are private, that is the social security money is invested in investment funds. Those two pension funds have shown average returns of 7% to 10% over 30 years. Efforts to privatize American pensions by both Clinton and Bush have been resisted--strange for an economic system like ours to oppose private investment anywhere. But if those funds are invested, they are not available for government appropriation.

Who is Tim Murphy and what was his relationship to the well-regarded Simon Frasier?

Christopher DeMuth in the Weekly Standard makes an interesting if obvious point. Deficit spending once was largely for investments - building infrastructure, winning wars - which benefited future generations, so government borrowing appropriately shared the burden with those generations. Now, however, continuous borrowing burdens future generations in order to finance current consumption. Today's policy, says DeMuth, erases "the distinction between investing for the future and borrowing from the future." The problem, possibly, is that government sees investment spending and consumption spending as the same because both go, unweighted, to GDP. (the suggestion is mine, not DeMurth's) The lesson: never let the government near a formula.

One solution to Prostate Cancer would be to move to Scandinavia. The studies there show the disease has less impact there.

We are 13 years into a secular bear market in the United States. The Nasdaq is still down 40% from its high, and the Dow and S&P 500 are essentially flat. European and Japanese equities have generally fared worse. The average secular bear market in the US has been about 11 years, with the shortest to date being four years and the longest 20.

The International Longshoremen's Association, AFL-CIO, is the largest union of maritime workers in North America, representing upward of 65,000 longshoremen on the Atlantic and Gulf Coasts, Great Lakes, major U.S. rivers, Puerto Rico and Eastern Canada. Dockworkers on the West Coast are represented by the International Longshore and Warehouse Union. According to James Capo of the U.S. Maritime Alliance, which represents management at the 14 deepwater ports along the East and Gulf coasts, ILA members coastwide average $124,138 a year in wages and benefits, "which puts them ahead of all but 2 percent of all U.S. workers. They earn an average hourly wage of $50 - more than double the $23.19 average for all U.S. union workers. They also pay no premiums and minimal co-pays and deductibles for a health care plan that is better than most U.S. employers provide their workers."

Price/Earnings (P/E) ratios are very good ways of evaluating stock market risk. And what influences P/E? In effect, the economic growth rate determines the P/E range and midpoint, and the inflation rate determines the location and trend within the range. Good growth, earnings (E) up, low growth, earnings down. Inflation up, prices down (due to competition with bond yields). However you view the prospect of increased taxes, there is no way to get around the fact that they will reduce general savings. If you reduce savings you reduce the capital available for investment in current and future businesses. If you reduce capital formation, you're going to reduce future growth.

The EPA has been investigating Fracking and its possible relationship to water contamination. Their studies in Texas and Pennsylvania showed no relationship (these results did not discourage a Middle Eastern financed movie from saying there was) but a Pavillion, Wyoming study did show contamination. Except the study was so flawed the EPA, after seeing their results were in conflict with the U.S. Geological Survey, withdrew it. The Tulsa-based energy and water-management firm ALL Consulting concluded: "Close review of the EPA draft report and associated documents reveals a number of concerns about the methodology, sampling results, and study findings and conclusions. These concerns stem from apparent errors in sampling and laboratory analysis, incomplete information that makes it difficult to assess the validity of the results, and EPA's failure to seriously consider alternative explanations for the results of its investigation. . . . Taken together, these concerns call into question the validity of EPA's analytical results and their conclusions regarding the sources of the reported contamination." So the regulator can't do the regulation and investigation correctly. Great.

Unions are big business. There is a fascinating thesis out there that says Obama's election was a direct result of Scott Walker's Right-to -Work success in Wisconsin. The unions recognized they were at risk and responded seriously. They spent five hundred million dollars (a half a billion!) on Obama's campaign and used 450,000 paid workers to canvass significant swing states, campaigning and getting the vote out. They may have been the difference.

Golden Oldie on the "cliff:" http://steeleydock.blogspot.com/2011/02/democrats-nixon-moment.html

AAAAAAaaannnnnddddddd ...a graph:

Quiddity and Tweedledum

Thank Heavens! The fiscal cliff has been averted. Or crossed. Or climbed. Or breached. Or something. But the real story is how the administration outmaneuvered the Republicans. How there is dissension among the House Republican membership. Can a coherent philosophy be developed now? Is their base alienated? Will the current Republican leadership ever be able to match the Democrat expertise?

Of course, this is all nonsense. None of these presumed crucial questions are important at all but instead are part of  an intricate and refined political dance that has rules and judgments but is almost completely separate from the circumstances that surround it. What is important is how the nation is going to manage one trillion, trillion, dollars of deficit annually and the accumulation of that deficit into sixteen trillion, trillion, dollars of debt. For some reason the brilliant political guns that have been used to defeat the Republican rubes cannot be trained upon this more important problem.

It is like having a minuet contest in a burning house. And the press continue to judge the dance.

Dogs and Guns and Voldemort

Freedom is interactive. There is an investment made by the free individual. He must have some socially agreed upon limits of his behavior and a reciprocal responsibility. Freedom does not mean license. The Greeks thought that compact with the polis had to be taught.

Our dog got out of the back yard last week. he wandered about, found a few interesting yards, dodged traffic, chased a squirrel and then followed a total stranger home.

The dog is charming and beautiful but he is too dumb to be free.

And this is the great problem that all democracies face. In this particular instance, it is seen in the viability of the Second Amendment: It declares a very dangerous right. A right that one might think some are too dumb to have. Or too crazy. And this, of course, dances around the primary question of all democracies, The Problem That Must Not Be Named. Are some more equal than others? Are some too dumb for some rights? Are some too dumb to vote?  Do some, because of some deficit, have more rights?

This is a very dangerous area. And it should be explored with both caution and humility. Of course, when you think you have all the world's many answers, there is no room for caution and humility. They just get necessarily crowded out.

The Right to Health Care

The country is beginning to descend into the morass known as the Affordable Care Act. This program insincerely purports to be a health care program when, in fact, it is an effort to control health care costs. It grandly presents itself as the achievement of a long neglected right, the right to health care. There have, of late, been a growth of rights around the world, whether realized or not. The Universal Declaration of Rights, created by the U.N., is instructive and here are a few examples:

Article:
16. to marry and found a family
22. free development of his personality.
25  adequate standard of living.
26. free education
27. enjoy the arts. (The same article has a rider: The right of copyright.)

All of these rights have in common the inability of the individual to exercise them without significant help and contribution from others. Free education must be funded and those funds must come from somewhere. One, to marry and found a family, must have a willing volunteer as a partner and...AND... that partner must be fertile; infertility would be an abridgement of the partner's rights. What about "free development of his personality?" Some of life's difficulties would be illegal if they cramped someone's development. And the "enjoy the arts" is a real zinger; what if the citizen doesn't like current styles or fashions. What if some guy in Nigeria can't see the Russian ballet?

Rights as principles have certain obvious characteristics. Life, Liberty, Pursuit of Happiness are inherently abstract notions that can be approached and fulfilled only by the active effort of the individual and careful distance by the state. But as goals, they get confused. Equality other than that by nature before God is clearly impossible. Fraternity is a bit whimsical; one cannot guarantee community on either end of the bargain. And promising such "rights" must be dangerous to the society; unfulfilled devotees certainly would reconsider the sincerity of the promise.

 

The real question here is medical care as a right. How is such a right seen? Is the medical care of the average New Yorker the same care as Shepherdstown, West Virginia? Doesn't the Shepherdstown citizen have a right to New York medical care? Certainly, if not identical, it should be comparable. And what about the physician; is he harnessed to the patient's right? Can he decline to care for someone or is his freedom limited by the patient's right to care? How does that infringement on his freedom work?

The problem here is that rights are inborn, inherent to the individual by his very nature. They are not goals. Nor are they products. They are not time sensitive--one cannot have rights that appear with a new technology  Most importantly, they are not a function of another's efforts, nor, especially, of another's freedom.