Regime Risk

At a dinner recently with some financial guys, one said the regional head of a national investment group was buying two months of food to store in his basement. The table laughed. Then another story was told of another man in a similar executive position doing the same.

There was less laughter.

The term "Regime Risk" is used often to describe the potential downside in an investment market based upon that nation's leadership--or lack thereof--and has always been reserved for those inadequate soundtruck democracies or countries flirting with capitalism but hampered by a uniformed junta. I have never heard it applied to the United States until now.

"I Don't Do Nuance"--George W. Bush

"Two years in prison is too long and we sincerely hope for the freedom of other political prisoners and other unjustly imprisoned people in America and Iran."

So spoke Shane Bauer upon being released from the notorious Evin Prison in Iran, a prison infamous as a site of sadistic torture of criminals of all stripes, political, religious, and civil. As a statement it is, by any standard, strange. There is a saintly acceptance and absence of bitterness, a vague nod to a community of suffering and injustice, and just a touch of insanity. This is a young man plucked off the border of Iran in Iraqi Kurdistan while hiking with his girlfriend and his best friend, buried in a horrible prison for two years by a capricious and malicious government on idiotic spy charges, subjected to God-knows-what and reading this statement one can hardly tell.

Mr. Bauer then went on to thank people for helping him obtain his release including Hugo Chavez, Noam Chomsky, Sean Penn and Yusuf Islam (nee Cat Stevens) but curiously omitted thanking President Obama (who made a public plea for his freedom) or Mrs. Clinton, the Secretary of State.

Thanking Mr. Chomsky was telling. Last year Chomsky wrote, in an appeal for the hikers, "These young people represent a segment of the U.S. population that is critical of [U.S.] policies, and often actively opposed to them. Hence their detention is particularly distressing to all of us who are dedicated to shifting U.S. policy to one of mutual respect rather than domination." So some innocent who supported the American Middle East position would be a more appropriate victim?

Can the American and Iranian legal systems really be compared side by side? Are there really American political prisoners? Who are they and how did they get there? The American justice system has its faults but it meets in public, has layers of appeals, has an aggressive free press that monitors it and people like Mr. Bauer who overtly and freely oppose it. It took the Americans ten years to execute Ted Bundy, an ersatz Prince of Darkness. This is quite unlike Iran and equating the two has an anger ridden and fantastic quality about it. In this fairy tale world, if "two years in prison is too long" for an innocent man, what would be too short and what would be just right?

This is a difficult statement to understand. It assumes an innocence in the Iranian perpetrators and a guilt in the American victims that is staggering. Perhaps Mr. Bauer, who has a degree in "Peace and Conflict Studies" from Berkeley, has become a truly enlightened man, full of forgiveness. But that does not explain his willingness to judge the Americans more than harshly.

That judgement seems to come from a harder core, a source unawakened by the cruelest of Iranian circumstances.

Marcellus #2

According to Pennlive.com this year, geologists at Penn State and the University of Wyoming released an petroleum industry-funded report on Marcellus Shale projections and economic impacts. It contained a disclaimer that none of the scientists or institutions “makes any warranty or representation, express or implied, with respect to the accuracy, completeness or usefulness of the information contained in the report."

What could this possibly mean? It means the good professors do not want an opponent of their opinion harassing their children in school or firebombing their garage. What it means is that even in academia honest debate and discussion are over. What it means is that scientific publications have become informational and nothing more. Concepts and hypotheses have become musings. And why not? What scientist in his right mind would want to put his name on a paper at Oral Roberts University that supports evolution? Does Obama's former economic advisor, Christina Romer, want to talk to the press about her concept of the tax multiplier when Obama is raising taxes? If you had a grant from NASA, would you argue with global warming?

What is happening in science is a microcosm if what is happening in the culture: Every single thing has become a singularity, a tiny individual black hole of self-righteous animosity. Everything that is done is done in isolation. Nothing has a connection to anything else. Global warming is not an interesting question or a possible problem that needs evaluated; it is a life threatening disaster of impending extinction or it is an academic scam created for the benefit of carbon credit traders. Fracking is a solution to our economic problems or a self-destructive act of mindless greed.

Amazingly in a postmodern world where nothing is felt to be clear or true, we are strangling ourselves with absolutes.

Marcellus #1

Marcellus Shale is not a college point guard, it is a huge petroleum deposit extending from western New York to West Virginia estimated from between 85 trillion to 480 trillion cubic feet, at least the second largest in the world. The implications, locally and nationally, are staggering. Richard Heckmann, the CEO of of the drilling service company Heckmann Corp. and who turned U.S.Filter from a multimillion dollar company into a multibillion dollar one, estimates that if liquid natural gas processed from this site could be used nationally by tractor trailers--which he estimates could be done in 5 years-- our dependence on Middle East oil would be over. Over.

And the spillover, if you will excuse me, would be unbelievable. On a single wellpad in western Pennsylvania 115 companies are involved in servicing it. Shell Corp. is considering a processing plant that will make the composite chemicals for plastic, tires and the like with the attendant growth of those industries around it. The growth of businesses and jobs would be enormous.

Yet there are nonprofit groups, politicians and anti growth groups that are rising to oppose this industry. They do not say "Let's figure out how to do this", they say "No."

I have a better idea: Let's put our money into Solyndra, solar companies and lithium battery companies and hope for the best.

India: Signs and Limits of Growth

There is a problem in India's GDP growth that gives an interesting insight to the way economies develop and how we must think. According to the Energy Information Administration, India has a population of 1.2 billion people and is growing, 40% of those people are not connected to the electric grid and 75% of Indians in rural communities use wood as their primary fuel. India's per capita energy consumption is 700 kilowatt hours; America's is 14,000.

India's annual growth rate is 8% and has been creating and developing a viable middle class. How much energy growth will be necessary in the next 5-10 years to support a continuing 8% annual growth? In other words, how much energy growth must India develop to prevent stifling their economic growth?

350,000 megawatts. To put that in context, the American grid, total, is 1,000,000.

Sunday Sermon: Carpe Diem

"The home run is not hit, it is pitched."

So said the esteemed philosopher and power hitter, Prince Fielder. Mr. Fielder is no ivory tower academician, he is a feared power hitter in Major League Baseball known for his athleticism, strength and intensity. But , according to Mr. Fielder, before he can bring his considerable skills to the athletic moment, the circumstances, i.e. the pitched ball, must be right.

Thus Mr. Fielder modestly sees the home run as an event dependent upon multiple factors and places the batter at the end of a series of evolving circumstances. The batter does not create the event, he completes it. But the philosopher does not imply the batter has no responsibility in some paean to postmodernism. What is crucial is what is not said. Every pitch is not a home run pitch and cannot be made one. But the home run pitch is always a home run pitch and it is the batter's responsibility to make it so. His success will depend upon his eye, his recognition, his training and practice, his strength and coordination, his mental preparation and his focus. The home run pitch will be completed depending upon the quality of the batter.

So the pitcher assesses the moment, what he knows of the batter's strengths and weaknesses and tendencies, what he has shown the batter, the pitcher's own strengths and weaknesses, training, scouting and planning, the count and what to stay away from. Then he winds and--with his strength and coordination--delivers the pitch which rockets towards the plate It is now the batter's time, his time to complete what the pitcher has put in motion..

In a fraction of a second the batter seizes the moment and becomes a hitter. Or not.

Should Caesar's Wife Have Taken the Fifth?

Solyndra. LightSquared. There have been a lot of mistakes by this administration but that is common enough. Some, like the Cash for Clunkers, were just stupid. Some, like the Guns for Cartels, were malignant. But supporting these companies, with administration financial ties and ownership, is the worst. It makes important leaders look sleazy. It makes them look petty. They are more than wrong; they are unworthy.

Caesar's first wife, Cornelia, died in childbirth delivering Julia who would later marry Pompey. Caesar then married Pompeia, Pompey's cousin. Caesar became Pontifex Maximus so the sacred rites of Bona Dea for "The Great Goddess" (whose name could not be spoken and whose rites are to this day obscure) were held in his house under the direction of his wife and his mother. (The rite was for women only, men forbidden.) Clodius, a famous rake and political leader, crashed the event dressed as a woman. He was discovered (and eventually tried in court which he bribed) It was felt by one and all that Pompeia had aided his entrance, likely because they were lovers. Caesar divorced her and, when pressed why, never gave his wife up as unfaithful. Instead he said "Caesar's wife must be above suspicion."

There is real nobility here in Caesar's protecting his wife. And the whole story is fascinating. But Caesar's statement is profound and should be basic for leaders.

But maybe Obama's above it.