Confused Trucker

Absolute Flaming Idiots

2009-09-26T13:32:00.000-07:00

Yahoo News:US auto safety group wants to curb gadget use by truckers

Advocates even wants the FMCSA, the DOT agency that oversees commercial trucking, to study whether using Citizens' Band (CB) radios -- which provide short-distance radio communications -- or dashboard-mounted navigational devices should be banned.

CB radios are a lifesaver on the road, both for truckers and other users. You can find out about accidents and hazards ahead and have time to prepare. Advocates are being absolute flaming idiots. Maybe if they could take a break from their railroad funded Jihad against the trucking industry they could, I don't know, do something about AUTO safety.

Reality Bites

2009-08-02T19:32:00.000-07:00

Ever wonder why contestants always act so crazy on "reality" shows? They're isolated, buzzed and Sleep deprived. Almost like Gitmo with cameras.

Kucinich cuts through the bull

2009-06-01T05:57:00.000-07:00

Bloomberg: Obama Saving GM Needed Dealmaker Team to Break It in Bankruptcy

Obama was taking the wheel out of the hands of a GM veteran who spent his 32-year career with the company that sent him to Harvard University for a master’s in business. The Wall Street restructuring experts were in charge.....

Because, after all, Wall Street has done such a good job lately managing its own affairs lately.

“Who is this auto task force, and who do they represent?” asked Representative Dennis Kucinich, an Ohio Democrat. “They represent various Wall Street interests who have long looked at exporting jobs out of this country.”

Wall Street Blows up the economy, then is handed vast sums of money with no strings attached along with many lucrative opportunities for self dealing at the taxpayer's expense. GM is blown up by the economy we give it to the geniuses who have worked night and day to ensure the collapse of the middle class so they can get a couple more beeps of yield on the deal.

By the Way, why are labor contracts sacred for AIG but not the UAW? How did the titans of Wall Street get to DC for their 4 trillion dollar bailout? How is complaining about a worker making $25 an hour plus benefits populism and complaining about a CEO making $25 million envy?

The Financial Crisis continues apace

2009-05-31T05:11:00.000-07:00

Brad Setser takes on the Foreign Bond Vigilantes story. He finds that Foreign Central Banks are not abandoning the treasury market, rather they are moving from longer dated (more than 2 yr) treasuries to shorter dated ones. This has an effect exactly the opposite of Greenspan's paradox, it lowers the cost of borrowing short and raises the cost of borrowing long. The effect is to drive up the costs of borrowing to fund the governments ongoing operations and to strangle the refinance boom (which is both getting Americans out of toxic mortgages and generating fee income for sick banks).

One of these things is not like the other

2009-03-28T14:04:00.000-07:00

The Transportation Security Administration is warning truckers that Mexican drug gangs are out of control and may target trucking operations to move their goods. Meanwhile the Obama administration is trying to pitch another program to allow Mexican truckers to roam the country. I appreciate that in the current economic crisis the Obama administration is staying focused on long term objectives. What's sad is those long term objectives are. Not content with the declining real wages of working Americans and widening inequality the Obama administration is anxious to outsource more jobs and enhance corporate profits.

Sacrifice

2009-03-28T13:34:00.000-07:00

Daniel Howes: Sacrifice? It's in this state's DNA

More rope to extend the federal lifeline -- now at $17.4 billion for General Motors Corp. and Chrysler LLC, and $5 billion for auto suppliers -- will come with conditions, the president says. He wants more sacrifice from unions and executives, bondholders and suppliers.
Sacrifice? What, exactly, has this town and its investors been experiencing the past three-plus years? Spring break? This notion, aired during the congressional inquisitions late last year, picked up by Team Obama and wielded by whoever's trying to score points, that Detroit Auto hasn't yet "sacrificed" in a (losing?) effort to fix itself is absurd.
The union has helped usher many thousands into retirement, bargained down its wage and benefit scale for new hires and agreed to sharp reductions in company health-care obligations. Brands have been sold, dealers lost, bonuses eliminated, salaries cut, tens of thousands of jobs eliminated in wave after wave after wave of reductions.
Plants are going or gone in communities across the country. Local and state tax revenue started plunging long before home values in Manhattan and the Bay Area did. Michigan's per-capita income, long among the nation's highest, has been dropping like a stone this decade and soon will be lower than Republican Sen. Richard Shelby's Alabama.
Sacrifice? We've seen a few, even if it doesn't look to be "enough" from the condescending heights of New York, Washington and San Francisco. And you know what? It isn't enough, not now anyway, not when technically insolvent companies are petitioning the Treasury Department for aid because their credit ratings are destroyed and car and truck sales are trending at terrifyingly low levels.
I, too, have argued Detroit's business model is hopelessly broken, that its costs were indefensibly high, its brand image tarnished, its culture mired in denial, its management and union leadership too often willing to accept short-term expedience at the expense of long-term success.
But sneering about sacrifice, as if there's been none, is a towering insult to the tens of thousands of families, white-collar and blue-collar, who took buyouts and walked out into a collapsing economy; to the dealers whose businesses have collapsed; to the 7,631 UAW members -- 53 percent of them in Michigan -- who this week accepted comparatively meager packages to walk away from GM.
Sacrifice? If there are two things this state and its bellwether industry understand, it's sacrifice and recession -- and the knowledge that there's more of both to come.

Gotta love how contracts are sacrosanct for the millionaire bankers at AIG, but when it comes to working people Obama is happy to use them for toilet paper. Obama's been busy this last week patting the poor persecuted bankers on the back and letting them know they are special after a few of them got their feelings hurt last week. The bankers, no doubt, are busy scraping the McCain bumoer stickers off of the back of the Beemer. The Union workers who helped put Obama in office may be allowed to eat the crumbs that fall from the bankers bacchanalian feast if they are suitably penitent and supine to receive what they've got coming.

Pump and Dump

2009-02-26T15:16:00.000-08:00

Words just fail me.

Treasury is going to overpay for Bank of America stock. We're going to pay "10% below the bank’s average stock price for the 20 trading days ending Feb 9" ("By the way, Feb 9 was the high point for all of these bank stocks during the month of February. What a coincidence.")

Guess what Bank of America executives were doing on the "20 trading days ending Feb 9"? Manipulating their stock price higher.

Oh, by the way, Obama has quietly signalled his intent to double TARP and give 750 billion more to the bankers (but we only expect to lose $250 billion of that, or over $800 for every man, woman, and child in the U.S.).

This is Zimbabwe worthy.

Freight is "in a free fall"

2009-02-01T21:28:00.000-08:00

So says FTR Associates

Truck purchases will continue to drop throughout 2009 due to overcapacity, and the first and second quarter will be incredibly difficult on fleets’ bottom lines, trucking industry analysts said today during an FTR Associates webinar.

“This recession, from a freight standpoint, started almost three years ago,” said Noel Perry, managing director of FTR Consulting. “There is a free fall right now, but it is also the effect of cumulative stress on the industry…We have such low capacity, as low as we’ve had since the 1970s—nobody working in the industry right now has experienced these levels.”

And railroads aren't doing so hot either.

The Multiplier that Matters

2009-01-25T07:52:00.000-08:00

John Phipps takes on Greg Mankiw. Here's a taste:

The esoteric world of economists is reveling in the attention the ideas put forth to revive our languishing economy have generated. I have watched with interest as the normally tepid prose of the profession becomes more heated (OK - warmed) as various proposals are offered.

One powerful argument is represented by Greg Mankiw, who offers (to me at least) persuasive reasons why tax cuts at the top and to businesses will give us the biggest bang for the buck. He has also offered reasoned arguments on the issue of growing inequality over the past few years....

Let me suggest it is far more crucial to our economic health to convince more Americans our system still works for them, not just some. Further, doing more of the same, i.e. cutting top tax rates, does little toward that goal, even if the models suggest it is the best of all possible choices. In contrast, everybody gets to use good roads or new schools.

I get proponents' point about multiplier effects and how tax cuts are the fastest, easiest most powerful way to jump-start the economy. But it looks a like a economic sugar high to me. And recent tax cuts produced an awful lot of ephemeral wealth, it seems. Surely a mixture of the two should not be dismissed out of hand by the economic community.

Academia's estrangement from the real world by virtue of tenure allows it a curious detachment from such ideas that engage non-tenured minds, at least until sufficient historical data accrues to make it worth studying. This myopia seems most pronounced the further up the ladder experts ascend. I have begun to weigh opinions from private sector economists with more respect, since they have much more on the line when they put forth proposals.

Our economy is suffering from a crisis of confidence by a large number of people who don't even know what a multiplier is. Or particularly care. And oddly enough, their opinions matter too. Actions that cause them to view the future with less alarm, or make less dysfunctional econiomic decisions are not to be despised.

Right now everyone, including the rich, is unnerved by the economy. The money being sent to the banks by the Feds is not being lent. Some of it is being blown on bonuses, dividends and acquisitions—but a lot of it is being stuffed in the vaults. Tax cuts without a change in social psychology will just lead to more money being "stuffed into mattresses".

Moreover, as Mr. Phipps points out, infrastructure has tremendous multiplier effects on the future productivity of the economy. America has suffered through years of underinvestment in the public and private sector. We plunged into debt to fund consumption, not investment. Now we have a fairly massive infrastructure deficit along with an enormous financial debt. The ribbons of steel, concrete and fiber that our economy flows across are worn out and overloaded. Rebuilding them will not only put people to work (and in the process inspire confidence) but also lays the groundwork for future growth and prosperity.

Military Budget Crisis looming

2009-01-05T09:53:00.000-08:00

The Big Picture: US Military Force Structure

My takeaways:
Massive Defense Budget cuts are coming due to competing Civilian Demands.
Military budgets are already inadequate for stated plans.
The Military is not structured for the missions it is taking on (Iraq, Afghanistan)
"....you can NOT train a force to do both kinetic war and win “Hearts and Minds” the psychological imbalance not only precludes a force from doing both, but when you try, you fail at both."
Procurement is utterly broken.
"....our current direction of recapitalization cannot be sustained in the face of fiscal realities, and it is probably the wrong direction anyway. Give the delays in new programs and the “LULL” that will exist in delivering them, there is about a 5 year gap in the 2013-2018 timeframe when our current readiness will drop below operational levels. Our current inventory was built on non-wartime metrics.
The 5 years of combat we have had has aged equipment 16-20 years and acquisition programs cannot keep pace and they are unfunded at even that level. For example HUMVEES were programmed for 8000 miles per year. The current inventory in the past 5 years has surpassed the 20 year life of the vehicle (i.e. the average is in excess of 150,000 miles). The vehicles replacement is due in 2014, but is expected to slip to 2018."

Opinion:
Either we need to transition to a full war footing or we need to disengage from Iraq and Afghanistan. No matter what we do we are going to be un-breaking the military for years, possibly a decade or more. We need a military that can "kill people and break things" a lot more than we need one for peacekeeping and that should be the basis for allocating resources.

Our one defining victory of the 20th Century was won on the China model. The "arsenal of democracy ' and the Russian war machine produced vast quantities of adequate weapons swamped the small number of fussy wonder weapons the Germans had. Like a bronze age king though we brought the vanquished enemy's fallen idols into our temple and bowed down before them. We became the ones counting on our wonder weapons that we could never afford to produce in quantity. Our resources are much larger than the German state so it took longer for us to hit a wall but we have. Moore's law does not apply to defense. If anything, it seems to be inverted.

The Death of Perspective

2009-01-04T17:42:00.000-08:00

Michael Lewis, writing about the financial crisis, offers this bon mot:

OUR financial catastrophe, like Bernard Madoff’s pyramid scheme, required all sorts of important, plugged-in people to sacrifice our collective long-term interests for short-term gain. The pressure to do this in today’s financial markets is immense. Obviously the greater the market pressure to excel in the short term, the greater the need for pressure from outside the market to consider the longer term. But that’s the problem: there is no longer any serious pressure from outside the market. The tyranny of the short term has extended itself with frightening ease into the entities that were meant to, one way or another, discipline Wall Street, and force it to consider its enlightened self-interest.

This is the essence of the crises we face politically and economically: the short term has utterly eclipsed the long term in the consciousness of our leaders. We have sold our inheritance for a bowl of Porridge. Whether it is the Congressman handing the bill writing over to the Lobbyist or the Rating Agencies selling AAA ratings to Investment Banks. Credibility earned over decades is being pissed away for short term advantage.

Economically, it is even worse, as Angry Bear guest writer "Edward Charles Ponzi Jr" writes:

In time, our current society will be seen as one that ate all the food in fridge, all the food in the pantry, sent out for pizza, maxed out the credit cards and then burned the furniture while proclaiming that we are really very warm and well-fed. Financial historians in the future will say, "what were they thinking?" about our era.

We are seeing the inevitable conclusion of the World's dumbest pyramid scheme wherein those at the top of the pyramid have sought to destroy those at the bottom. Demand, kept on life support by the pawning of America, has finally collapsed.

An Odd Thought

2008-12-28T16:26:00.000-08:00

The latest wave of fraud (Madoff) and the first wave of fraud (subprime) have both featured ethnic ties exploited by hucksters. Madoff was a pseudo-mensch who preyed upon the Jewish community. During the subprime debacle lots of of minorities were led into terrible mortgages by Judas goat Mortgage brokers who were their race or spoke their language.

Class Warfare

2008-12-22T08:17:00.000-08:00

Dean Baker: More Class Hatred in the Washington Post

The Post editorial, after deploring the fact that bailout money was diverted from Wall Street to the real economy, celebrated the pay cuts that the bailout would impose on UAW workers. For some reason, the Post attaches enormous importance to reducing the pay of auto workers who earn $28 an hour. It shows no comparable concern for reducing the pay of auto industry executives to parity with their foreign competitors. (The top executives at Toyota, Honda, and other successful companies get paid in the neighborhood of $1-2 million a year. Unlike their U.S. counterparts, they don't get paychecks in the tens of millions of dollars even in the best years.) The Post has allso never felt the need to insist on large pay cuts for Wall Street executives even though their banks are now wards of the state.

Somehow resenting the excess pay of someone who makes 1000 times as much as you is the "politics of envy" while resenting the pay of someone who makes a few percent more than you do is "populism".

WMDs on Wheels?

2008-12-08T12:39:00.000-08:00

Today's Trucking: Poultry a Road Hazard?

Apparently, it's not diesel exhaust exposure you should worry about when pacing behind another tractor-trailer. Instead, you might want to roll up the windows and hold your breath if you're ever trailing a live chicken hauler.

According to a new study by researchers at Johns Hopkins University, chickens hauled in crates on open flatdecks can release antibiotic-resistant bacteria along the highway and into vehicles traveling behind them.

There's a happy thought if the Bird Flu ever goes virulent.

Pay to Play is alive and well

2008-11-28T07:39:00.000-08:00

Daniel Howes, Detroit News: Cashing in on double standards

The feds pump another $20 billion into teetering Citigroup Inc. and insure $306 billion in bad assets just days after Congress slaps Detroit's automakers for failing to table "a plan" to justify $25 billion in loans and folks 'round here cry, "Double standard! Double standard!"
......Double standard? You bet, but it's more than a geographic cabal of coastal Democrats and anti-union, pro-foreign auto Republicans from the South that clearly has it in for Detroit. It's money and political alliances, folks, neither of which the boys at General Motors Corp., Ford Motor Co. and Chrysler LLC have in abundant supply.
How come Citigroup gets a pass and a big fat check? First, failure of its sprawling operations truly would pose a mortal threat to the global financial system. Second, the banking giant is exceedingly well connected to the campaign wallets of the very same folks -- and their allies -- who are poised to foist draconian terms on Detroit to keep it afloat.

Howes goes on do detail all the incestuous ties between the twits who brought us the financial crisis and the Democratic powerbrokers. It's a good thing that John McCain did such a bang up job getting corporate money out of Washington.

One Question

2008-11-23T15:31:00.000-08:00

It sounds like Congress had a great deal of fun hectoring the heads of the automakers and the union. One thing that bothers me though. If the principle holds that people who fail deserve a pay cut then it seems, given the failures in regulation and oversight at the root of this financial disaster, to be pertinent to ask "Where is Congress' pay cut?"

Make no mistake the vast sums of borrowed money from Uncle ~~Sam~~ Hu being stuffed into the carcasses of the banks this Thanksgiving are intended to save, not the assets of the imprudent Bankers, but the asses of the Congressmen whose sins of omission and commission were the prerequisites to this slow motion disaster.

[Update: Mitch Albom lays down a delightful rebuke of Congress.

Is a man an interchangeable part?

2008-11-23T14:40:00.000-08:00

Right now the UAW is trying to present a united front with the management of the Big 3 but under the surface is a bitter mutual dislike. The UAW sees management as being incompetent, overpaid, and quick to blame the union for its own failures. Management for its part is very bitter about the above market wages and benefits that the unions are able to extract for "unskilled labor" and union workers "inflexibility".

Building a car with competitive efficiency is a highly complex process involving careful design of both the car and the production process. Henry Ford and Walter Chrysler both had the ability to build a car from the ground up with their own hands. Such skills are rare, though, and both turned to masses of semi-skilled laborers, used in very carefully engineered ways, to build their cars. One of the essential points of such an arrangement is that employees are expected to be like the parts they assemble: interchangeable. The process is developed with the intention that any capable person could be placed in any position on the line and keep up. There are some more skilled positions (usually in maintenance and setup) that require more education and pay a little more but the principle holds.

Is it any wonder that people trained to think that a person is an interchangeable part would find the idea of a few people making a huge multiple of what everyone else makes absurd? Management would take the other side and argue that paying a worker nearly double what another worker off of the street would cost* is absurd.

For my wooden nickel, the workers have the better side of it. But then again this is a world where a great inner city school teacher makes far less than a mediocre backup quarterback in the NFL.

*The difference in cost is not so much the wages and benefits being paid to the person on the line, but in pensions and benefits being to retirees that are part of the contract with workers.

A Little Naughty Fun

2008-11-17T05:44:00.000-08:00

John Emerson explains the economic crisis.

An appetizer:

Tranches are bundles of loans mysteriously sorted and packaged according to how risky they are. Large corporations buy tranches and use them as collateral to borrow money from other large corporations. These corporations are owned partly by individuals, but mostly by still other large corporations, which themselves might very well also be owned by more large corporations yet. In the end you have millions of actual home loans at one end and millions of actual individual investors at the other, with an undecipherable maze of legal entities and financial instruments linking them. (You might as well discuss quantum theory, it’s easier). Few or none of the flesh and blood owners have any idea what’s going on, until finally one day they wake up and BOOM! their money is all gone. (If anyone knows what happened, it’s probably the managers hired to manage these various legal entities, but they have just voted themselves enormous bonuses and never have cared to socialize or communicate with the pitiful rabble who own the stock anyway.)

Economists don’t worry about these things, though. (Nader does, but Nader isn’t an economist and he’s crazy too.) Economists worry about welfare Cadillacs, transfer payments, and waste in Democratic budgets. Government, in sharp contrast to the free market, is inefficient and corrupt and can never do anything right.

So long and thanks for all the votes

2008-11-08T16:42:00.000-08:00

Chicago Tribune: Obama's team on economy reflects times

In Chicago on Friday, President-elect Barack Obama will meet with his economic transition team. It's a group that looks a lot like America, or an America that wears very well-tailored suits, anyway.

Often, the "looks like America" phrase, which originated with the Clinton administration, is shorthand for saying the assembled members are not all white men. But the typical measures of diversity—race and gender—are not the principal distinctions in this case.

The America in this group of 17 high-powered advisers is the America of our troubled economy. Wall Street is represented, and so is Detroit. There's a dot-commer, an old-media guy, a real estate investor and some politicians.

....Perhaps the most interesting part of the grouping is the notable swath of the economy that is, in many respects, left out: industrial America and organized labor.

....The lack of labor presence might raise questions about whether Obama truly is committed to revising terms of the North American Free Trade Agreement to protect labor's interests. But perhaps the presence of Bonior, who opposed NAFTA as a representative from suburban Detroit, should put suspicions to rest.

I'm sure Obama will be "interested" in the Rust Belt again in time for the next election.

The Myth of the Spendthrift American

2008-11-03T06:39:00.000-08:00

Robert Reich slaps a bad idea across the snout and sends it whence it came:

Post Meltdown Mythologies: Americans Have Been Living Beyond Their Means

What brought on the economic meltdown of 2008? Besides the bursting of the housing bubble, Wall Street's malfeasance and non-feasance, and Washington's massive failure to oversee Wall Street, fingers are also being pointed at average Americans. Some of them took on mortgages they couldn't afford, of course, but we're also hearing a more basic theme that goes something like this: For too long, Americans have been living beyond our means. We went too deeply into debt. And now we're paying the inevitable price.

.....But this story leaves out one very important fact. Since the year 2000, median family income has been dropping, adjusted for inflation. One of the main reasons the typical family has taken on more debt has been to maintain its living standards in the face of these declining real incomes.

.....The "living beyond our means" argument suggests that the answer over the long term is for American families to become more responsible and not spend more than they earn. Well, that may be necessary but it's hardly sufficient.

The real answer over the long term is to restore middle-class earnings so families don't have to go deep into debt to maintain what was a middle-class standard of living. And that requires, among other things, affordable health insurance, tax credits for college tuition, good schools, and an energy policy that's less dependent on oil, the price of which is going to continue to rise as demand soars in China, India, and elsewhere.

In other words, the way to make sure Americans don't live beyond their means is to give them back the means.

The hollowing out of the American middle class had the perverse effect of simultaneously holding down wages and interest rates. Jobs are outsourced to China, driving down demand for American Labor (and thus the price). China sends many of those dollars back to the US (to raise the price of the dollar versus the Yuan) and as a side effect lowering long term rates. For the worker it's rather like being robbed and then offered a low interest loan from your own wallet by the mugger.

Blame America First (it's bipartisan!)

2008-10-19T06:51:00.000-07:00

The creatures outside looked from pig to man, and from man to pig, and from pig to man again; but already it was impossible to say which was which.

One of the recurrent Republican lines about Democrats is that they are America haters in favor of unilateral disarmament. The logic goes, supposedly, that if America were to disarm other nations would feel less threatened and would spend less on their militaries and we all could devote more spending our domestic economies.

But if you think about it, the standard libertarian Republican holds the same basic belief translated to the economic realm. Pretty universally, they claim Government (the people we elect) is the problem. Never mind that if you elect them these same Republicans would be by definition "part of the problem" and no longer "part of the solution". When it comes to trade, the idea is that if we dropped all of our trade barriers that we would be better off. Remarkably enough American workers cannot compete with subsidized foreign competition.

An Army is not that different from a manufacturing business. Chuck Norris movies to the contrary, militaries primarily consist of taking a large number of people and investing in training and equipment with the hope that the operation can outcompete rivals. The American military swept Iraq from Kuwait and later swept into Iraq without much difficulty because of the massive capital investments of the preceding decades. It wasn't that the Iraqi soldiers were especially cowardly, lazy or stupid, it was that they could not compete with the much more subsidized American competition.

Many countries competing with us for jobs hold down the real wages of their workers by Union suppression or currency manipulation and do not regulate pollution or workplace safety. Developed and Developing Nations are paying companies to build facilities in their jurisdiction. American workers are not especially lazy or stupid but they cannot compete with the much more subsidized foreign competition.

The hits keep on coming

2008-10-19T06:20:00.000-07:00

Today's Trucking: Yup, carbon the next truck 'pollutant' targeted

Caterpillar has already announced it's leaving the US on highway engine market thanks in large part to the 2010 rules. Daimler has announced an end to the Sterling line (and the firing of 4500 workers) in March of 2009 thanks in part to the upcoming rules and the aftermath of the 2006 prebuy (though given Daimler's history it seems possible that this move was in part in retaliation for the 2006 strike in the Sterling plant in St Thomas, ON).

Now in the midst of this, the EPA has another wonderful plan to reduce choice and increase cost. We were emitting less carbon (i.e. burning less fuel) before the EPA killed fuel economy with the last rule changes (and the trucks cost $20K less). now the EPA will work hard to make sure we can pay even more and maybe get the economy we had before.

Come Home America

2008-09-14T16:08:00.000-07:00

Fortune: Made (again) in America

Talk of a reverse migration of manufacturing from China to the U.S. has been buzzing across union halls and factory floors, corporate boardrooms and Wall Street.

The cost of shipping outsourced goods from China to U.S. customers has doubled in just two years thanks to high oil prices, and labor costs in China are rising sharply.

I suspect that a lot of the low end manufacturing that was done in China will wind up in Latin America. America will benefit where we have an existing base of facilities and talent. China likely will still be a force in high tech goods and other items that are labor intensive and have a high value to weight ratio. Going the other way, I wonder what the impacts of high transportation costs on U.S. agricultural exports will be?

When the various free trade agreements were inked, the line was that Americans would be moving out of low value manufacturing and into high value Information Technology jobs. Rising energy costs are having a much bigger impact on moving physical goods than on moving data. Perhaps Paul Krugman was right.

A Building Legal Storm

2008-09-07T03:34:00.000-07:00

Attorney general Brown sues 2 port trucking firms over labor practices

California Atty. Gen. Edmund G. Brown Jr. filed lawsuits against two small trucking companies on Friday on grounds they allegedly deprived drivers of benefits and "cheated the state of California out of thousands of dollars in payroll taxes."

Brown said in a statement that the lawsuits filed in Los Angeles County Superior Court signaled a crackdown on trucking companies at the adjacent ports of Los Angeles and Long Beach that classify drivers as independent contractors to circumvent state employment taxes and labor laws, and have an unfair advantage over competitors

Fed Ex Ground has been sued successfully on this basis in multiple jurisdictions. I suspect the California AG is hoping to establish a precedent for truckload carriers (which would be huge). In addition to the state potentially collecting millions in back taxes from trucking firms in the state, it would open the door for Port truckers to organize for better wages, something they are unable to do as "independent contractors".

This may also be a means to preempt the American Trucking Association's challenge to the Ports of Los Angeles' and Long Beach's plans to require all drayage operators to use employee drivers. Most of the current drayage fleets will not survive settling up with the State for back taxes.

The precedents are working their way through the industry. I suspect the first National Truckload carrier targeted will have a lease-purchase/captive finance program, pay a flat rate per mile, and have forced dispatch. Each of those makes the driver a bit more like an employee (with, as one wag put it, a 100 thousand dollar lunchbox).

Rapidly rising costs and the soft freight market are going to change the lease purchase business model rapidly. I expect the looming legal fights will just accelerate the process. Many "independent contractors" are in multi year leases/loans for traditional square nosed tractors which are now uneconomical to operate and are losing value rapidly (much like the used SUV market is imploding). Pre-buying new trucks to avoid 2008 emissions rules, the collapse of construction (a common 2nd home for the traditional design trucks),and marginal operations exiting the business have loaded up the used truck lots. Exports of used trucks will help, but it is going to take time for the market to clear. Tighter credit conditions will also be a drag.

In an Instant Everything Changed

2008-09-07T03:18:00.000-07:00

Guelph Mercury: Anatomy of a car crash

That moment before impact -- the split second when Mary Wybrow lost control -- remains vivid in her memory, even two years later.

"I just remember thinking, 'Oh my God,' and then, 'Bang!' " the 59-year-old retired teacher says, smacking her hands together to emphasize the force.

"Something hit us. Or I hit something."

The collision left Wybrow in hospital for weeks. It destroyed a car and a transport truck, closed Highway 401, sprung a small army of emergency services into action and required a costly cleanup.

For the people in the cars and trucks that crawled by the wreckage west of Cedar Creek Road on Aug. 17, 2006, it was likely just another crash. It wasn't fatal and it got only a small mention in the newspaper.

For the four people involved in the crash -- three in Wybrow's car, one behind the wheel of the truck -- the impact reverberated long after the mangled pieces of Wybrow's Taurus were swept away. There were emergency rooms, traction, surgery, bills to be paid, meals to be made, lost sleep, nightmares. For Wybrow's son, Kemal Koyu, there was a lingering feeling of soaring.

Most truck drivers will be involved in a serious accident eventually. Even if you are not at fault you feel absolutely terrible.

For Want of a Nail

2008-08-18T00:31:00.000-07:00

The Telegraph: How a flat tyre took the Caucasus to war

Trouble had been brewing in the disputed South Ossetian region for weeks as Moscow-backed militias skirmished with Georgian troops, yet Russian-brokered negotiations between the Georgian government and the separatists had continued.

But the first substantial face-to-face talks on August 7 fell through after a farcical chain of events in which the top Russian diplomat claimed he was unable to attend the meeting in South Ossetia because his car tyre had run flat.

Refusing to take his excuse at face value, the Georgian delegation then assumed they were being lured into a trap, and began the shelling that invited the Russian invasion.

The article goes on to mention that the Georgians were given Satellite photos by the Americans showing the Russians were sending tanks into South Ossetia while the peace talks were occurring. Still, it is amusing to think that the war started from a flat tire. Archduke Ferdinand, Patron Saint of obscure reasons for going to war, would be proud.

CNN does another Hatchet Job on the trucking industry

2008-07-21T06:47:00.000-07:00

Medically unfit truckers still on the road, safety study shows

Hundreds of thousands of tractor-trailer and bus drivers in the United States carry commercial driver's licenses, and some of those drivers have suffered seizures, heart attacks or unconscious spells, according to a new U.S. safety study obtained by The Associated Press

There are "hundreds of thousands" of CDL holders and "some of those drivers" have medical problems. Well, how many is some? I'm not sure if this is a poorly written sentence or if the writer is trying to pull a fast one.

According to to the FMCSA there are varying estimates of the number of truck drivers on the road. The CDLIS system, which holds information on current and former CDL holders in all 50 states, has 11.4 million entries. Federal Estimates of the number of people currently working as truck drivers range from 2.9 million to 4.8 million. So there's more than "hundreds of thousands" of CDL drivers out there.

Truckers violating federal medical rules have been caught in every state, according to a review by the AP of 7.3 million commercial driver violations compiled by the Transportation Department in 2006, the latest data available. Texas, Maryland, Georgia, Florida, Indiana, Pennsylvania, Illinois, Michigan, Alabama, New Jersey, Minnesota and Ohio were states where drivers were sanctioned most frequently for breaking medical rules, such as failing to carry a valid medical certificate. Those 12 states accounted for half of all such violations in the United States

Once again we have a pseudostatistic. We are told medical violations are part of 7.3 million violations, but we are not told how big of a part they are. Are they one percent or twenty percent? "Failing to carry a valid medical certificate" can encompass everything from not having the paper CDL physical on your person (not a big deal) to actually not having a current physical (a big deal). You can't renew your CDL without a current medical certificate so folks without one are not going to be doing that forever. Many states also will void your CDL if they don't have a current cert on file for you (one copy goes to the carrier, one to the State, and one to the driver). Being in possession of a piece of plastic that says "CDL" on the front doesn't necessarily mean that you really have a CDL (just like you can still possess a driver's license even though it is suspended).

Now to the case studies:
A Virginia trucker with a prosthetic leg from a farm accident more than 10 years ago is permitted to drive tanker trucks until at least 2012, even though he doesn't have the proper federal paperwork required for amputees. Virginia revoked the medical license for the official who approved him to drive over charges the official was caught illegally distributing controlled substances.
Well, he's probably going to be driving after that too. The scam is that in order to be certified with a prosthetic you have to demonstrate 2 years of safe operation of a Commercial Motor Vehicle with a prosthetic (which you can't legally do without a valid medical certificate). Shades of M.C. Escher.

George Albright Jr., 61, smashed his 70,000-pound tractor-trailer into congested traffic on Interstate 70 in June 2006, killing four women in a Ford sedan about 30 miles east of Columbia, Mo. Albright's employer agreed earlier this year to pay $18 million in a settlement. A Missouri jury acquitted Albright this month on four counts of second-degree involuntary manslaughter, after his lawyers argued in court that a diabetic episode "put him in an altered state of consciousness." Albright wasn't injured.
If the diabetes is controlled without insulin, he's legal. Obviously if he was indeed having a diabetic episode he wasn't managing his diabetes. The medical examiner under any conceivable system is only going to see the driver every so often. If we are going to allow diabetics to operate CMVs we are going to have to depend on them managing their own condition.

The driver of a 15-passenger "Tippy Toes" day-care bus traveling 63 mph on Interstate 240 in Memphis, Tenn., in April 2002 crashed into a bridge, killing the driver and four of the six children aboard. The National Transportation Safety Board said the driver, Wesley B. Hudson, 27, fell asleep, "quite likely due to an undiagnosed sleep disorder." Investigators said children sometimes had to wake up Hudson, whom the NTSB described as obese and a marijuana user.
A 15 passenger van does not require a CDL. According to the NTSB report Mr Hudson did not have a CDL (PDF, page 5). He had a regular Tennessee license with a "for hire" (taxi) endorsement. Indeed, one of the unimplemented recommendations of the governor's commission that investigated the tragedy was to require child care transport workers to have a CDL. But the AP doesn't let any of this stand in the way of a good story.

The dog that didn't bark in this story is the fact that there are no health requirement for operators of RVs, no matter their weight or size, and that states often allow farms and other intrastate operators of trucks to follow much less rigorous standards.

Also left out is the fact that the CDL physical is nothing more than a basic physical. The doctor making the decision about whether or not to certify the driver only has the driver's answers to the health questionnaire, their direct observation, and a urine test to go on. The physician does not have access to the driver's medical records.

A question of incentives for CDL medical examiners might be raised. The article mentions efforts to avoid "doctor shopping" by drivers, but what about carriers? The physical is paid for by the company, which will usually contract with a doctor to perform the exams. It might seem that a "picky" doctor could be at risk for work being sent elsewhere. I don't know that that is a realistic concern for most of the doctors out there, but there probably are a few conflicted physicians on the margins.

Puzzling

2008-06-29T11:02:00.000-07:00

Truck tonnage rises in May

The American Trucking Associations’ advanced seasonally adjusted For-Hire Truck Tonnage Index increased on a month-to-month basis for the first time since January of this year, edging 0.5 percent higher in May. April’s tonnage reading fell a revised 0.6 percent instead of the previously reported 1.1 percent drop.

The seasonally adjusted tonnage index equaled 114.8 (2000 = 100) in May. The not seasonally adjusted index increased 1.1 percent to 118.3 from 117.1 in April.

The seasonally adjusted index was 3.3 percent higher compared with May 2007, marking the seventh consecutive year-over-year increase. In April, the year-over-year gain was 2.2 percent.

ATA Chief Economist Bob Costello said that May’s tonnage reading represents a positive step forward, but noted that freight volumes remain mixed across the industry amid continuously rising fuel prices and a weak economy.

“The fact that tonnage increased on a month-to-month basis for the first time in four months, as well as achieving its largest year-over-year gain since February of this year, is quite positive,” Costello said. “However, year-over-year comparisons continue to reflect the weakness of 2007 rather than robust growth in 2008.”

High diesel fuel prices continue to place a significant burden on motor carriers, he said. “Rising fuel prices are a double-edged sword for the industry,” Costello said. “Since trucks haul virtually all consumer goods at some point in the supply chain, the industry is significantly impacted both directly through high diesel prices and indirectly as consumers have less money to spend on truck-transported goods.”

Truck tonnage seems to have been moving in a range with a flat trend the last four years. I am surprised that the decline in automotive and housing related shipments is not having more of an impact (automotive related shipments alone are about 8% of total tonnage). Less than Truckload Carriers have been reporting drops in shipments the past few months, auto production is falling to 16 year lows, housing starts are at 17 year lows, supposedly massive amounts of freight is moving from trucks to trains, but truckload tonnage is back up to where it was in May 2006.

Sometimes you just wonder

2008-06-29T09:19:00.000-07:00

The Bush Administration is blocking new solar projects........

(wait for it)

(wait for it)

....because they're so concerned about the environment they want to do an extended review.

We've got an energy crisis. We've got the money we're sending over to OPEC being passed on to Iraq where it is used to blow up the people and stuff we send to Iraq (talk about funding both sides of a war). I guess "there's a war on" only carries water for the administration when it comes to finding new and creative ways to spy on us.

A Price/Asset Deflation Spiral?

2008-06-28T19:31:00.000-07:00

In the 1970s inflation in the U.S. reached dizzying levels amidst a falling Dollar, an easy Fed, Soaring Oil Prices, and the infamous "Wage/Price Spiral". Many commentators see the U.S. headed for another inflation catastrophe.

Paul McCulley says this isn't the 70s and that isn't necessarily good news.

But, you retort, if the Fed surrenders to negative real interest rates, it will set off an inflationary spiral, as second and third round effects on prices and wages take hold: capital and labor will extrapolate what should be viewed as a transitorily higher inflation into permanently higher inflation. In a world of perfectly indexed prices and wages, this could well be the case. The 1970s resembled such a world, and nasty oil price shocks that should have been one-off adjustments in the price level via temporarily higher inflation morphed into a price-wage-price inflationary spiral.

In monetary policy terminology, inflation expectations in the 1970s were not firmly anchored at the pre-oil price shock level. This is true, I think, but more elementally, the highly unionized, closed-economy structure of the American economy price and wage setting process was inherently geared to transforming a one-off inflationary shock into an enduring inflationary shock.

We no longer live in such a world. Most importantly, wage inflation is now only loosely connected to price inflation, in the wake of a more globally competitive, less unionized labor force. As Vice Chairman Kohn hinted, the combination of somewhat higher inflation and higher unemployment is a prescription for diminished pricing power by labor, leading to lower real wages (than would be dictated by labor’s productivity growth). Thus, unlike the 1970s, there is little wage fuel to generate over-heating aggregate demand and, thus, a sustained price-wage-price inflationary spiral.

This is good news indeed. Fed officials would make this argument through the lens of well-anchored inflationary expectations, and I have no quarrel with that interpretation, though I think it is but a veil over a more global, more competitive, less oligopolistic price and wage setting structure in the United States. Indeed, I believe the more nasty is the negative terms of trade shock, the fatter is the fat tail of asset price deflation rather than the fat tail of accelerating goods and services inflation.

Deflating asset prices in a highly levered economy are a much more nefarious outcome than temporary increases in inflation in goods and services. This is particularly the case from a starting point of low inflation in goods and services (excluding those involved in the negative terms of trade shock). How so? Simple: a negative terms of trade shock and asset price deflation are a prescription for not just a recession, but a nasty one. More to the point, from a starting point of low goods and services inflation, the Fed is never far from the zero lower limit on nominal short-term interest rates, commonly known as a liquidity trap.

Therefore, the more flexible are wages in the face of a negative terms of trade shock, particularly if it coincides with asset price deflation, the greater is the risk of policy makers losing control of the economy on the downside. In turn, this reality argues for the Fed to tolerate higher headline inflation in the wake of a negative terms of trade shock.

In the 1970s many more of the U.S.'s workers were unionized, and unions were negotiating pay increases, not pay cuts.

Today, workers are much less likely to be unionized and lack the pricing power to get wage increases that keep up with increasing food and energy costs. Indeed, workers have been losing ground on real* wages for years. (*real=adjusted for inflation, nominal=the numerical amount, for example a salary of $300/week is the same nominally in 1930 and 2000, but much less in real terms). Workers are going to have to consume less. This is going to limit inflation in food and energy as demand falls for both. That's the good news. The bad news is that this is also going to lower demand for houses, which are already losing value, as well as increase foreclosures. Many people in the "bubble markets" on the coast and in the worst off parts of the rust belt already owe more on their mortgage than their home is worth. This time rising food and energy prices may not show up in rising wages, but rather in falling home prices.

What if the Empire isn't really American?

2008-05-20T19:32:00.000-07:00

James K.A. Smith: The Gospel of Freedom, or Another Gospel? Augustinian Reflections on American Foreign Policy

Much of the contemporary critique of “empire”—especially from theological quarters—tends to be a hasty, at times naïve, invocation of an epithet to describe America as the world’s bully. Stepping just a couple of rungs above Michael Moore (which doesn’t get one too far up the ladder), this reactionary opposition—to the Bush administration in particular—tends to keep the notion of Empire tethered to the sovereignty of a particular nation-state. But Michael Hardt and Antonio Negri have convincingly suggested in Empire—and more recently, Multitude—that we are dealing with a new mode of Empire that is unhooked from territories and (modern) nation-states, and linked to a network of “flows” of a transnational market. Too much of the theological critique of “American Empire” is reacting as if we lived in an age of (modern) imperialism where sovereign nation-states are the principal actors and where empires are governed from a territorial capital.

But the thrust of Hardt and Negri’s analysis is to show that our age of Empire is post-imperialist; therefore, the nexus of Empire is not linked to or directed by a sovereign state, as the language of “American Empire” would suggest. Rather, Empire is post-national, and therefore any diagnosis and critique of imperial realities must abandon now antiquated imperialist paradigms, including all of the critical apparatus that was marshaled in opposition to such modern accounts of sovereignty. Granted, the United States continues to play a central role in Empire, but not as the territorial seat of imperialist power. There remains a link between America and Empire, but not as a qualifier: not American empire, but rather America serving Empire, even perhaps America as privileged colony of Empire, now understood as a transnational network of “flows” of capital through a global market that transcends territorial control. Post-imperial Empire means that the market has taken on a life of its own as a rather Frankenstein-ish creation of modernity that eludes the control of modern nation-states. Empire has outgrown the constraints of national sovereignty. Its anthem is no longer “Rule, Britannia!” or some other national hymn; its anthem is more on the order of, “I’d like to buy the world a Coke!”

I think Smith is on to something here.

The Empire we live in is in many way one of Corporations and of Culture. When Congressmen talk about taxing Hedge Fund managers at the same rate as mere Businessmen the managers threaten threaten to flee abroad. Corporations hide profits in the most favorable haven. The World certainly doesn't like our politics, but more than that they don't like the lawless irresponsible way of doing business and the kudzu culture that tear through societies everywhere.

Thoughts while listening to podcasts, or Why W ought to be a liberal's favorite letter

2008-05-16T12:04:00.000-07:00

I was listening to Ross Douthat's interview of Rick Perlstein, author of Nixonland and I was struck by Douthat's point that for all of Nixon's cynicism and dark plots, his pettiness and veniality made him less dangerous to the Republic than a more competent and emotionally secure cynical politician.

Here's a snip from Douthat's review of Nixonland making the same point

And yet one doesn’t have to excuse Nixon’s many sins to wonder whether his mix of ruthlessness, self-interest, and low cunning might have been preferable to some of the alternatives on offer. Perlstein depicts a country on the edge of a civil war—a nation in which columnists openly speculated that America might embrace a de Gaulle–style man on horseback, or find a “President Verwoerd” (the architect of South African apartheid) to install in the Oval Office. It was a political moment when the old order could no longer govern, and the new order wasn’t ready. The kids who screamed for Goldwater and McGovern would grow up to be responsible Reagan ites and Clinton ians, but back then they had only idealism, not experience, and Nixonland is an 800-page testament to the dangers of idealism run amok.

......Perlstein sometimes seems to suggest that Nixon was the abyss, and that by choosing him we vanished into it. But this misunderstands contemporary America, and it misunderstands Dick Nixon. A cynic in an age of zeal, a politician without principles at a moment that valued ideological purity above all, he was too small a man to threaten the republic. His corruptions were too petty; his schemes too penny-ante; and his spirit too cowardly, too self-interested, too venal to make him truly dangerous. And he was a bridge, thank God, to better times. Could America have done better? Perhaps. But on the evidence of Nixonland, we could have done far worse as well.

The parallels to our current situation seem striking. I had listened to another Douthat Interview with Ezra Klein earlier in the day, and what I took from Klein was that his concern with the Iraq war is not so much that the war was prosecuted incompetently but that the war was pursued illegitimately (by which he means that the war was not endorsed by a multilateral institution, specifically the UN). I disagree with Klein's belief that a war must be Sanctioned by the UN or some other transnational body in order to be legitimate but leaving that aside, the reason that the liberal side is ascendant in our understanding of the war is that it has gone poorly. The Mexican-American war was recognized by many people in the Army and in the General Population as a really illegitimate and cynical act of aggression but there was no real move to undo the decision, even when war opponent Lincoln gained power. The war had been won quickly and the rewards were tangible enough that the public never renounced the idea.

Had the occupation of Iraq been well planned and run, the question of the propriety of invading Iraq in the first place might never have broken into the national dialogue. Throughout the past few decades, Americans have removed multiple governments by military force. Generally that has happened well before the American public became restive (even if the consequences beyond our attention span were not good). As a result, it became accepted that we could easily take out governments that we disliked and the question of whether we should never got a wide airing. But now, as the war has dragged on, it has become more acceptable across the ideological spectrum to ask whether we should be in the business of regime change. In that way it seems that George W. Bush has performed a National Service.

"Bitterness"

2008-04-13T12:36:00.000-07:00

The present controversy over Barack Obama's comments about the plight of working class people leaves me a little cold. My wife was at one of his events in Indiana, and she reported that there was a standing ovation when Obama gave his little riff on the subject. I heard the riff the next morning on a newscast and I thought it was fine. When I heard there was a controversy about it I went and read the quotes and saw how if you worked at it you could twist this into an anti-God, Guns, and Nativists rant. I think his essential point is sound, people are stressed about the economy and people who are stressed tend to be a bit more disagreeable. I'm religious, I agree intellectually with the basic right to bear arms (though in real life I'm in favor of reasonable restrictions), and I am in favor of a secure border, and I was not bothered by his statement.

I don't think Obama is a believer in the evangelical sense of the word, but I also don't think he's some Muslim manchurian candidate or the antichrist or whatever. He's just a typical agnostic Ivy grad going to a liberal church. I don't think he's atypical among our recent leaders (see Bush, George H.W.). I don't think he's exceptionally harmful to the church. Actually, after W. getting a little air between the Church and the Republican party can only be good for the reputation of the church.

I don't think Obama is going to take away all the guns. That's not a fight that's going to advance the Democratic party and right now the Democrats want more than anything else to be in power. The NRA won't get to it's goal of an AK-47 under every pillow.

On Immigration I expect something not far from what El Presidente Bush (and McCain) really wanted. It's going to happen no matter which one we vote for. To Obama's point, immigration would be a lot easier to deal with if joblessness had not been on the increase for the last 30+ years.

If we fix the economy and get a healthy dose of regulation to keep it fixed, Obama will have been a success.

A Short Guide to How the Bush Administration Reacts to Crisis

2008-03-30T05:06:00.000-07:00

The New York Times (via Naked Capitalism ) comments on Paulson's financial industry "regulation" proposal:

While the plan could expose Wall Street investment banks and hedge funds to greater scrutiny, it carefully avoids a call for tighter regulation.

The plan would not rein in practices that have been linked to the housing and mortgage crisis, like packaging risky subprime mortgages into securities carrying the highest ratings.

......The bulk of the proposal, however, was developed before soaring mortgage defaults set off a much broader credit crisis, and most of the proposals are geared to streamlining regulation.

Basically they are continuing the pattern of proposing something they wanted to do anyway as the answer to the crisis of the day (see "Bush Tax Cuts", "Bush Tax Cuts II: Grandchild's Woe", and "Rambo IV: Operation Iraqi Freedom"). Style points as well for spinning "non-regulation" as "regulation" and for scrupulous avoidance of effectiveness.

The Coming Big Story

2008-03-24T05:16:00.000-07:00

Paul Krugman:Taming the Beast

America came out of the Great Depression with a pretty effective financial safety net, based on a fundamental quid pro quo: the government stood ready to rescue banks if they got in trouble, but only on the condition that those banks accept regulation of the risks they were allowed to take.

Over time, however, many of the roles traditionally filled by regulated banks were taken over by unregulated institutions — the “shadow banking system,” which relied on complex financial arrangements to bypass those safety regulations.

Now, the shadow banking system is facing the 21st-century equivalent of the wave of bank runs that swept America in the early 1930s. And the government is rushing in to help, with hundreds of billions from the Federal Reserve, and hundreds of billions more from government-sponsored institutions like Fannie Mae, Freddie Mac and the Federal Home Loan Banks.

Given the risks to the economy if the financial system melts down, this rescue mission is justified. But you don’t have to be an economic radical, or even a vocal reformer like Representative Barney Frank, the chairman of the House Financial Services Committee, to see that what’s happening now is the quid without the quo.

Last week Robert Rubin, the former Treasury secretary, declared that Mr. Frank is right about the need for expanded regulation. Mr. Rubin put it clearly: If Wall Street companies can count on being rescued like banks, then they need to be regulated like banks.

Mark Thoma lays out a pretty decent summary of the change in tax laws and financial regulations that brought us to where we are today (though I noticed Bill Clinton's role in repealing Glass-Steagal was not mentioned). Basically massive tax cuts for the wealthy created a wave of new money, which financial deregulation allowed to flow into new ungoverned instruments.

Pretty soon the new money was finding its way into all sorts of formerly sleepy sectors of markets chasing the next hot thing and pretty reliably creating progressively larger catastrophes. The current catastrophe in the credit markets is large enough to really hurt. Assuming we manage to deal with the crisis successfully, the prudent thing would be to establish rules and regulations to make sure such things don't happen again. Unfortunately, Wall Street has thrown plenty of payola Washington's way which has so far stifled reform. Paradoxically, a larger crisis may be in the national interest because it would change the M.O. for political survival from fund raising and not rocking the boat to making changes before the voters throw the bums out.

Deja Vu All Over Again

2008-03-08T05:19:00.001-08:00

VIa Naked Capitalism I found an interesting post on Robert Reich's blog. He quotes Marriner Eccles, a depression era Federal Reserve governor, on the cause of the great depression:

As mass production has to be accompanied by mass consumption, mass consumption, in turn, implies a distribution of wealth -- not of existing wealth, but of wealth as it is currently produced -- to provide men with buying power equal to the amount of goods and services offered by the nation s economic machinery. Instead of achieving that kind of distribution, a giant suction pump had by 1929-30 drawn into a few hands an increasing portion of currently produced wealth. This served them as capital accumulations. But by taking purchasing power out of the hands of mass consumers, the savers denied to themselves the kind of effective demand for their products that would justify a reinvestment of their capital accumulations in new plants. In consequence, as in a poker game where the chips were concentrated in fewer and fewer hands, the other fellows could stay in the game only by borrowing. When their credit ran out, the game stopped.

That is what happened to us in the twenties. We sustained high levels of employment in that period with the aid of an exceptional expansion of debt outside of the banking system. This debt was provided by the large growth of business savings as well as savings by individuals, particularly in the upper-income groups where taxes were relatively low. Private debt outside of the banking system increased about fifty per cent. This debt, which was at high interest rates, largely took the form of mortgage debt on housing, office, and hotel structures, consumer installment debt, brokers' loans, and foreign debt. The stimulation to spending by debt-creation of this sort was short-lived and could not be counted on to sustain high levels of employment for long periods of time. Had there been a better distribution of the current income from the national product -- in other words, had there been less savings by business and the higher-income groups and more income in the lower groups -- we should have had far greater stability in our economy. Had the six billion dollars, for instance, that were loaned by corporations and wealthy individuals for stock-market speculation been distributed to the public as lower prices or higher wages and with less profits to the corporations and the well-to-do, it would have prevented or greatly moderated the economic collapse that began at the end of 1929.

The time came when there were no more poker chips to be loaned on credit. Debtors thereupon were forced to curtail their consumption in an effort to create a margin that could be applied to the reduction of outstanding debts. This naturally reduced the demand for goods of all kinds and brought on what seemed to be overproduction, but was in reality underconsumption when judged in terms of the real world instead of the money world. This, in turn, brought about a fall in prices and employment.

Unemployment further decreased the consumption of goods, which further increased unemployment, thus closing the circle in a continuing decline of prices. Earnings began to disappear, requiring economies of all kinds in the wages, salaries, and time of those employed. And thus again the vicious circle of deflation was closed until one third of the entire working population was unemployed, with our national income reduced by fifty per cent, and with the aggregate debt burden greater than ever before, not in dollars, but measured by current values and income that represented the ability to pay. Fixed charges, such as taxes, railroad and other utility rates, insurance and interest charges, clung close to the 1929 level and required such a portion of the national income to meet them that the amount left for consumption of goods was not sufficient to support the population.

This then, was my reading of what brought on the depression.

"...an exceptional expansion of debt outside of the banking system" See Paul McCulley's "Shadow Banking System"

Consumption financed by debt, well with negative savings rates I'd say we're there.

Roaring 20s inequality, we've got it .

Strapped Consumers who can't go anymore, check

Loan Sharks

2008-02-17T05:15:00.000-08:00

The Wall Street Journal: High-Interest Lenders
Tap Elderly, Disabled

DOTHAN, Ala. -- One recent morning, dozens of elderly and disabled people, some propped on walkers and canes, gathered at Small Loans Inc. Many had borrowed money from Small Loans and turned over their Social Security benefits to pay back the high-interest lender. Now they were waiting for their "allowance" -- their monthly check, minus Small Loans' cut.

The crowd represents the newest twist for a fast-growing industry -- lenders that make high-interest loans, often called "payday" loans, that are secured by upcoming paychecks. Such lenders are increasingly targeting recipients of Social Security and other government benefits, including disability and veteran's benefits. "These people always get paid, rain or shine," says William Harrod, a former manager of payday loan stores in suburban Virginia and Washington, D.C. Government beneficiaries "will always have money, every 30 days."

What's sad is these groups use "partner agreements" with banks to skirt the prohibition on creditors receiving direct deposits of Social Security checks. In an administration that was focused on making government work, there'd be a revision of the rules when this came to light and after 6-9 months (allowing for comment periods and so on) the problem would be solved. This administration chooses to actively avoid performing its regulatory duties, hence the subprime debacle and the ongoing Mexican trucks and Hours of Service fiascoes.

Big Brother is Watching

2008-02-04T14:01:00.000-08:00

CNN: FBI wants palm prints, eye scans, tattoo mapping

The FBI is gearing up to create a massive computer database of people's physical characteristics, all part of an effort the bureau says to better identify criminals and terrorists.

But it's an issue that raises major privacy concerns -- what one civil liberties expert says should concern all Americans.

The bureau is expected to announce in coming days the awarding of a $1 billion, 10-year contract to help create the database that will compile an array of biometric information -- from palm prints to eye scans.

The never ending expansion of the Surveillance State under Bush is one of his most unfortunate legacies. I never have understood the belief that as long as government isn't helping someone then it's not big government. The same conservatives who carp about the "Nanny State" are the ones pushing for the "Enforcer State" where big government will spare no right, commit any atrocity, do pretty much anything to keep us safe from any threat. There's a reason our founding generation, surrounded by enemies and riven with sedition, insisted on a bill of rights and why in hindsight we have always looked with regret on those moments in our history when we chose to abridge those rights.

Why I am not watching the Super Bowl

2008-02-03T18:47:00.000-08:00

The NFL allows bars, but not churches, to publicly show the game

Hillary's Analysis

2008-01-13T05:17:00.000-08:00

There was a bit of controversy last week about some comments Hillary Clinton made last week. Hillary said

"I would point to the fact that that Dr. King's dream began to be realized when President Johnson passed the Civil Rights Act of 1964, when he was able to get through Congress something that President Kennedy was hopeful to do, the President before had not even tried, but it took a president to get it done. That dream became a reality, the power of that dream became a real in people's lives because we had a president who said we are going to do it, and actually got it accomplished."

My reading of this seems to set LBJ over and above JFK in his ability to "get it done" (and implicitly arguing a "competent" candidate (Hillary/LBJ) was more useful than a "change" candidate (JFK/Obama). LBJ was famous for the "treatment" he could deliver in person and for his ability to work legislation through Congress. Still, though I think a significant part of why LBJ was able to "get it done" was the moral authority of the recently slain JFK and the trauma of a stunned nation. Much like after 9/11, the President was able to run the tables on Congress for a time. I think if it had not been for the progressive rhetoric of immediately sainted JFK and of the soon to fall MLK that it would have been much tougher for Johnson to "get it done".

None of this takes away from the fact that LBJ probably showed more political courage than JFK. Kennedy had not gone to the mat for tough legislation in part because he worried about blowing up the Democratic coalition. Johnson bulled it through and did indeed blow up the coalition (being caught in a losing war didn't help). Other than a self inflicted loss in 76 the Republicans were ascendant for the next quarter century.

What is truly sad is that Republicans in the late 1800s abandoned blacks in the south to the tender mercies of the traitors after having expended so much of the nation's blood and treasure to free them and subdue said traitors. U.S. Grant was the last to try and he was finally forced to give up the fight by a recalcitrant Congress and a pro Klan Supreme Court. The Republicans not only lost black voters, they in many ways lost their identity. The whole Civil Rights controversy that roiled the nation in the 1950s and 1960s should have been in large part settled in the 19th Century.

Daggone it

2008-01-01T20:19:00.000-08:00

I haven't checked in on The Spy who billed me lately and so I missed this hilarious CIA themed Christmas tale So if you haven't had enough Fruitcake head on over

This just irritates me

2008-01-01T17:33:00.000-08:00

CNN: Christian Symbol appears in Huckabee ad

WASHINGTON (CNN) – For the second time in the past two weeks, presidential hopeful Mike Huckabee has aired a commercial in which a Christian symbol appears in the background.

In the campaign ad, Huckabee is addressing members of the Iowa Christian Alliance, an organization whose symbol is the ichthys which appears on a banner that is shown prominently at the open and close of the 30 second spot. The ICA is an influential social conservative organization in Iowa, and Huckabee can be seen speaking about his opposition to abortion before the group.

The ichthys, which resembles a fish, is well-known in evangelical circles as the symbol used by early Christians to secretly identify one another without attracting persecution.

Oh my goodness, a video of Huckabee speaking is shown and there is a banner for the organization putting on the event behind the podium. The space is obviously rented and the banner was put up to dress the space up and to make sure the organizations logo makes it onto any newsreel footage of the candidate, just like the UAW or the VFW or whatever organization you might think of would do. But of course since the logo contains a Christian symbol we must all be scandalized and shocked and mutter darkly about the coming theocracy. I'm sick of the liberals who want the French Revolution redux, complete with the banning of all public expressions or signs of faith. If you don't like a country with equal protection for all beliefs there are plenty of slots on the plane to France.

Hours of Service still in limbo

2007-12-31T20:22:00.000-08:00

Today's Trucking: Court action filed against interim HOS rule

A little recap, after a 15 year process the rules that restrict the number of hours a truck driver may work in a week were significantly revised for the first time in 2003. The original rule had been written in 1937, then slightly altered in 1962. Congress had mandated that the rules be changed, had given a list of factors that the Agency should consider (the rule-making process outlasted the ICC and the FHWA and eventually became the purview of the FMCSA), but did not say exactly what the rules should be.

Under the old and the new rules drivers were restricted to working 60 hours in a 7 day period, or 70 hours in an 8 day period.
However under the new rules if you take 34 consecutive hours off your hours are "reset" and you have a fresh 60/70 to work.

Also the rules restricted the number of hours you could drive in a "day" (after 1962 the rules were no longer tied to a 24 hour day). Under the old rules you could drive for no more than 10 hours before you took an 8 hour break. You can work and drive up to 16 hours before you have to take an 8 hour break, so your "day" could be anywhere from 18 to 26 hours long. Also you could "split break" and take your sleep break in installments, extending your day. Under the new rules once you start working you have 14 hours from the start of your day until you can drive no more. Also you are allowed 11 hours of driving time in a day.

Basically it's typical sausage making. There are plusses and minuses for safety and for the carriers. The upside from a safety perspective is there is a limit on the number of hours in a day you can go before you have to get off the road and there are 2 more hours of break every night. The downside is that you can drive one more hour a day and you can, in theory work more hours in a week (theoretically you can work 88 hours in an 8 day period with the 34 hour reset). From a productivity perspective the upside is you can possibly get more miles in a day with the extra driving hour. The downside is that any time that you are sitting counts against your 14 hour clock. So if it takes 6 hours to get the truck loaded at a grocery warehouse you only have 8 hours available to drive (and that assumes no other stops or breaks). Keeping the truck moving becomes very important to maximizing revenue. Routes were rearranged, extra trucks and drivers were acquired, and everyone adapted to the new rule.

So this rule goes into effect. Several groups sue, arguing that the rule does not consider the health of the driver, one of the factors Congress had insisted be taken into account. Eventually the rule is thrown out by the courts in July 2004. The FMCSA argues that they cannot rewrite the rules in the 90 days alloted by the courts, So Congress writes a provision into a transportation bill that freezes the rules for a year allowing the agency time to redo the rules. So in 2005, the agency publishes the revised new rule, which is pretty much the same as the 2003 rule (light trucks were given an even more lenient rule and the last vestiges of "split breaking" were eliminated). They are sued again. The rule is thrown out again in 2007. They petition for a stay allowing them time to redo the rule. They get a stay (only 90 days instead of the requested year) and produce another "new" rule, which is in every way the same as the old one (only with more text justifying the rationale followed). So now they have been sued again.

You would think at some point the agency would catch on that the courts do not approve of what they are trying to do. Also, one could make the point if Congress had just written a new rule in legislation they could have gotten exactly what they wanted and we wouldn't be tied up in court. Another issue is that Congress has been steadily exempting various industries in response to lobbying. For instance, propane delivery drivers are exempt from the rules (which is kinda odd given the hazardous nature of the load). Right now we have the worst of both worlds. Congress can dodge responsibility for the rules (and loudly complain that the agency isn't doing what they want without ever specifying what exactly they want) and industries are still getting preferential treatment by lobbying.

I think that the best hope for a good rule before 2010 or so would be via legislation. The Agency has gone nowhere fast over the past 4 years and doesn't seem to have any intent other than running out the clock. Of course given the election I suspect there will not be a lot of energy left to deal with this issue. So I suppose we will wait and eventually we will have a permanent rule. Hopefully we won't be waiting another 20 years.

Guilty Pleasures

2007-12-25T10:51:00.000-08:00

Huckenfreude:
Pleasure derived from the outrage of prominent conservative pundits over the rising poll numbers of Mike Huckabee. Particularly sharp when the pundits in question are partisans of Rudy Giuliani, but extends to supporters of Mitt Romney as well. Usually experienced by evangelicals, crunchy cons, populists, and other un-airbrushed elements of the conservative coalition. Tends to coexist with an awareness that Huckabee isn't actually ready for prime time, and that his ascendancy may ultimately do their various causes more harm than good.

I admit to enjoying some Huckenfreude at the way the GOP establishment has come unhinged over Huckabee's rise. Listening to them reminds you of the liberal establishment going ape about Bush in '04 and '05 before they learned to pace themselves. Rush even took a break from popping pills and picking at his ingrown hairs to thunder forth that Mike Huckabee was liberal (which is what Rush calls anyone he doesn't like, even that guy with the Ron Paul button at Burger King that burned his triple whopper and gave him fries instead of rings). The Wall Street types were undecided whether to express alarm or contempt, so they just punted and displayed both.

The same folks who were the picture of tough minded paternalistic condescension to the Social cons when Rudy looked likely to win the thing going away "Look Paulie, I know he isn't everything you wanted, but times are tough now don'tcha see, and he's definitely better than that Hillary gal.", are now acting like they're in one of those Jim Cramer gone wild videos.

Even if I have ambiguous feelings about Huckabee I'm still enjoying seeing a man from "flyover country" make the Wall Street and Washington crowd sweat bullets.

Strange Thoughts

2007-12-25T07:11:00.000-08:00

I was struck while listening to a Church History course podcast the parallels between the Reformation and the transformation of Judaism that occurred under Ezra. In both cases the Religion became more "book centered". In both cases there was a dislocation in the structure of the religion. In Judaism the Temple cultus was interrupted and the people of Judah found themselves in exile. In the case of the Reformation the authority of the church had been disrupted by the "Babylonian captivity" of the pope and the Great Schism.

In both cases the people has to form a new identity.

The followers of Adonai/YHWH found themselves cut off from the Temple rites and the land, the two centers of pre-exile belief. So they had to find a new way to define who they were. What did it mean to be Jewish in this strange new world. Of course eventually this new understanding (and the diaspora) would lead to many different subgroups within Judaism with very different views of the world.

The Christians of the 14th century found themselves in a similarly alien circumstance, with various popes of varying degrees of legitimacy all claiming to be the leader of the church. The pope was not yet the infallible vicar of Christ he would become in Catholic theology later on but still there was a tremendous dislocation where the people had to find a new way of thinking about what made one a real Christian. Out of this Wycliffe, Hus, and the other prereformers began to turn the Scriptures as the way to define Christianity, a change that would eventually revolutionize (and splinter) the Western church.

I don't know the moral/theological significance of the rough parallel, but I thought it was striking.

"Profiles in Courage" by Mitt Romney

2007-12-23T09:07:00.000-08:00

The Boston Globe: Fact Check: Romney's pardoning practices

Mitt Romney's new TV commercial questions the judgment of Mike Huckabee, his fellow Republican presidential contender, noting the rival issued 1,033 pardons and commutations as governor of Arkansas while Romney issued none while leading Massachusetts.

Left out of the spot is perhaps Romney's most noteworthy pardon denial: his rejection of the request of an Iraq war veteran who was trying to become a police officer after his National Guard service.

Anthony Circosta's offense? Shooting a friend in the arm with a BB gun as 13-year-old. The impact didn't break the skin.

....In 2005, while serving in Iraq, Circosta filed for a pardon, seeking to fulfill his dream of becoming a police officer. It was denied twice, despite a favorable recommendation from the state's Board of Pardons.

Circosta returned home a Bronze Star winner after leading a platoon in Iraq's deadly Sunni triangle.

Political analysts have suggested Romney crafted guidelines for issuing pardons and commutations that ensured he would never have to grant either, sparing him of any repeat of the Willie Horton case that dogged another Massachusetts governor, Democrat Michael Dukakis, during his 1988 presidential campaign. Dukakis was criticized for the weekend furlough granted to Willie Horton, a convicted murderer who went on to rape a woman and beat her boyfriend while free.

....He said the only reasons he would have issued a pardon or commutation would have been if he found evidence that proved a wrongful conviction, prosecutorial misconduct or errors in the judicial process.

Today, Romney uses the latter rationales for explaining why he would be open to considering a pardon for I. Lewis "Scooter" Libby, the former White House aide convicted of perjury in the CIA leak case.

Mitt wants to president, real bad. Avenge his father's honor and all that. So Mitt says what he has to say to become governor of Massachusetts, says what he has to say in order to run for Senate. Mitt Doesn't want to follow in the footsteps of Michael Dukakis, so he creates a brain dead procedure that will always reject any pardon petition. That way we will never question his judgment and interrupt his trek to the ~~Death Star~~ White House.

But now Mitt's path is blocked. Mitt angry, Mitt SMASH the Huckabee. Mitt creates ads attacking Mike Huckabee because Huck made a decision to pardon someone who committed another crime. Too bad Huck wasn't clever like Mitt.

But now it comes out that Mitt's "procedure" has spat out the result that Scooter Libby should be pardoned. Mitt is pleasantly surprised and all. But here we are wondering about his judgment again. D'oh!

Mitt thinks Scooter Libby, who has never admitted wrongdoing for his recent crime, is more worthy of a pardon than Anthony Circosta, who admitted wrongdoing for a crime committed as a child and has since distinguished himself in service to his country. Of course, Scooter probably knows folks who can do nice things for Mitt, and poor Anthony, well he doesn't. Maybe Anthony should have thought a little harder about how to serve his country

Public Service?

2007-11-26T09:24:00.000-08:00

CNN: Lott to resign by the end of the year

Sen. Trent Lott, R-Mississippi, intends to resign by the end of the year and join the private sector, sources tell CNN.

Trent Lott, R-Mississippi, is serving his fourth term in the U.S. Senate.

Lott, the No. 2 Republican in the Senate, is expected to make the announcement Monday in Pascagoula, Mississippi.

A senior Republican source close to Lott said one reason for the decision is the new lobbying restrictions on former lawmakers.

A law kicks in on January 1 that forbids lawmakers from lobbying for two years after leaving office. Those who leave by the end of 2007 are covered by the previous law, which demands a wait of only one year.

Lott, the Republican whip, was elected last year to a fourth term in the Senate. His term lasts until 2012.

So the good Senator just couldn't wait till the end of his term to go be a lobbyist. So the people of Mississippi got less than a quarter of the term they voted him in for (and the replacement will be on the very bottom of the seniority ladder). Now it probably is true that they're better off without someone who would leave them high and dry like that but still....

So much for honor and public service and all that claptrap, the man's got money to make.

2007-11-18T04:34:00.000-08:00

Bloomberg: Public School Funds Hit by SIV Debts Hidden in Investment Pools

Hal Wilson smiles at the blue numbers on his desktop screen. His money is yielding 5.77 percent. For the chief financial officer of Florida's Jefferson County school board, that means the $2.7 million of taxpayer funds he's placed in the state's Local Government Investment Pool is earning more on this October day than it would get in a money market fund.

And Wilson says he knows the Florida officials who manage the funds of the 1,559-student district have invested them wisely.

``We're such a small school district,'' Wilson, 55, says. ``We don't have the time or staff for professional money management. They have lots of investment advisers. It's risk free and easy.''

It may be easy, but it's not risk free. What Wilson didn't know in October -- and what thousands of municipal finance managers like him across the country still haven't been told -- is that state-run pools have parked taxpayers' money in some of the most confusing, opaque and illiquid debt investments ever devised.

These include so-called structured investment vehicles, or SIVs, which are among the subprime mortgage debt-filled contrivances that have blown up at the biggest banks in the world......

Among the places caught up in the SIV and subprime snarls are Connecticut, Florida, Maine, Montana and King County, Washington. Public funds hold $1 billion of defaulted asset- backed commercial paper, including $273.5 million from SIVs.

Montana entrusted $465 million, or 19 percent of its $2.5 billion investment pool, to SIVs.

Nobody knows how much more pain is coming. State funds could lose hundreds of millions of dollars, says Lynn Turner, chief accountant of the U.S. Securities and Exchange Commission from 1998 to 2001.

Wall Street peddled toxic waste to many, many bagholders. Cities and States are just some of the victims. These local governments are going to face massive losses in their investment portfolios just as they face declining tax revenues and increased expenditures in the economic slowdown. I bet it's going to play well in the Mudville Gazette: "School loses millions on subprime investments".

Wall Street is the next Detroit, they are building their legions of burned customers now. All of the institutions who purchased something toxic that their rep at the Wall Street Banks said was safe are going to remember this. Even if it cannot be proved, they will remember this as fraud. The big boys should go to Detroit and ask them what it's like to sell to a cynical customer base that does not believe what you say about the quality and safety of your products, if they listen at all.

Freedom is on the March...

2007-11-17T17:08:00.000-08:00

CNN: Saudi court ups punishment for gang-rape victim

A court in Saudi Arabia increased the punishment for a gang-rape victim after her lawyer won an appeal of the sentence for the rapists, the lawyer told CNN.

The 19-year-old victim was sentenced last year to 90 lashes for meeting with an unrelated male, a former friend from whom she was retrieving photographs. The seven rapists, who abducted the pair and raped both, received sentences ranging from 10 months to five years in prison.

The victim's attorney, Abdulrahman al-Lahim, contested the rapists' sentence, contending there is a fatwa, or edict under Islamic law, that considers such crimes Hiraba (sinful violent crime) and the punishment should be death.

"After a year, the preliminary court changed the punishment and made it two to nine years for the defendants," al-Lahim said of the new decision handed down Wednesday. "However, we were shocked that they also changed the victim's sentence to be six months in prison and 200 lashes."

The judges more than doubled the punishment for the victim because of "her attempt to aggravate and influence the judiciary through the media," according to a source quoted by Arab News, an English-language Middle Eastern daily newspaper.

Judge Saad al-Muhanna from the Qatif General Court also barred al-Lahim from defending his client and revoked his law license, al-Lahim said. The attorney has been ordered to attend a disciplinary hearing at the Ministry of Justice next month.

Good to know that the Bush administration is focused on democracy and human rights. Our good friends the Saudis have played their nasty little games while hiding behind Uncle Sam's legs.

The Nation Formerly Known as America

2007-11-12T11:39:00.000-08:00

Yahoo News: Intel official: Expect less privacy

WASHINGTON - As Congress debates new rules for government eavesdropping, a top intelligence official says it is time that people in the United States changed their definition of privacy.

Privacy no longer can mean anonymity, says Donald Kerr, the principal deputy director of national intelligence. Instead, it should mean that government and businesses properly safeguard people's private communications and financial information.

Kerr's comments come as Congress is taking a second look at the Foreign Intelligence Surveillance Act.

Lawmakers hastily changed the 1978 law last summer to allow the government to eavesdrop inside the United States without court permission, so long as one end of the conversation was reasonably believed to be located outside the U.S.

The original law required a court order for any surveillance conducted on U.S. soil, to protect Americans' privacy. The White House argued that the law was obstructing intelligence gathering because, as technology has changed, a growing amount of foreign communications passes through U.S.-based channels.

The most contentious issue in the new legislation is whether to shield telecommunications companies from civil lawsuits for allegedly giving the government access to people's private e-mails and phone calls without a FISA court order between 2001 and 2007.

Some lawmakers, including members of the Senate Judiciary Committee, appear reluctant to grant immunity. Suits might be the only way to determine how far the government has burrowed into people's privacy without court permission.

The committee is expected to decide this week whether its version of the bill will protect telecommunications companies. About 40 wiretapping suits are pending.

The central witness in a California lawsuit against AT&T says the government is vacuuming up billions of e-mails and phone calls as they pass through an AT&T switching station in San Francisco.

Mark Klein, a retired AT&T technician, helped connect a device in 2003 that he says diverted and copied onto a government supercomputer every call, e-mail, and Internet site access on AT&T lines.

The Electronic Frontier Foundation, which filed the class-action suit, claims there are as many as 20 such sites in the U.S.

So the government now believes it has the prerogative to listen in on your phone calls, read your e-mails, and track your internet use without trifling with probable cause, much less a warrant. To top it off this is the same crowd that believes they have the right to grab you off the street and "disappear" you, possibly sending you who knows where for who knows how long, where you have no rights, and if they ever deign to let you go you have no legal recourse. I remember a titanic struggle against such a regime back in the 80s. I guess Bush decided the wrong side won.

Congress pwned by Media Giants

2007-11-12T07:51:00.000-08:00

Ars Technica: New bill would punish colleges, students who don't become copyright cops

A massive education bill (747-page PDF) introduced into Congress contains a provision that would force colleges and universities to offer "technology-based deterrents" to file-sharing under the pain of losing all federal financial aid. Section 494 of the College Opportunity and Affordability Act of 2007 is entitled "Campus-Based Digital Theft Prevention" that could have just as easily been called "Motion Picture and Recording Industry Subsidies," as it could force schools into signing up for subscription-based services like Napster and Rhapsody.

Under the terms of the act, which is cosponsored by Rep. George Miller (D-CA) and Rep. Ruben Hinojosa (D-TX), schools will have to inform students of their official policies about copyright infringement during the financial aid application and disbursement process. In addition, students will be warned about the possible civil and criminal penalties for file-sharing as well as the steps the schools take to prevent and detect illicit P2P traffic.

That's not all: schools would have to give students an alternative to file-sharing while evaluating technological measures (i.e., traffic shaping, deep packet inspection) that they could deploy to thwart P2P traffic on campus networks. Many—if not most—schools already closely monitor traffic on their networks, with some (e.g., Ohio University) blocking it altogether, and the bill would provide grants to colleges so they could evaluate different technological solutions.

The most objectionable part of the bill is the part that could force schools into signing up for music subscription services. In order to keep that beloved federal aid money flowing, universities would have to "develop a plan for offering alternatives to illegal downloading or peer-to-peer distribution of intellectual property."

So basically Colleges and Universities will be forced to spend valuable money guarding the Media industry's property or to cut students off from the internet to avoid losing financial aid. I thought the Credit Card issuer profit maximization act (Bankruptcy Reform) was pathetic. Every single bought and paid for Congressman should be charged with receiving bribes (maybe I'm simple minded, but when someone gives a lawmaker money and in exchange ghostwrites the laws I don't see the subtle distinction).

Congress finally draws a Line in the Sand

2007-11-07T21:09:00.000-08:00

They can't stop the war, they can't muster the will to get working families' kids health insurance, but when Bush vetoed pork by God that cannot stand

It makes you wonder.....

2007-11-07T21:01:00.000-08:00

....whether all these poisonous Chinese products coming over are accidents.

CNN:Millions of toys recalled; contain 'date rape' drug

Millions of Chinese-made toys have been pulled from shelves in North America and Australia after scientists found they contain a chemical that converts into a powerful date rape drug when ingested. Two children in the U.S. and three in Australia were hospitalized after swallowing the beads.

The lead paint deal I thought was just a matter of being cheap (and in part due to intricate and ever changing web of subcontractors and suppliers used by Chinese businesses which thwarts accountability). This seems like a different critter. I'm glad the kids are mostly too old to want toys this Christmas.

That's gonna leave a mark!

2007-10-27T20:35:00.000-07:00

McCain lays a "gotcha" line on Hillary

McCain won the night by acclamation with a brilliant attack on Hillary that not so subtly highlighted his own unique qualification for the presidency. Citing his record on controlling spending, he ridiculed Hillary's proposed $1 million earmark for a Woodstock museum. He didn't make it to Woodstock, McCain explained. He was "tied up at the time."

McCain's edge in this crowded field is that he has proven he has guts, rather than just playing a tough guy on TV like Giuliani and Thompson.

Do Social Conservatives Heart Huckabee?

2007-10-21T06:41:00.000-07:00

Yahoo News:Evangelicals Reject Giuliani

Several thousand Christian conservative voters rebuffed an olive branch from Republican White House hopeful Rudolph Giuliani Saturday, over his support for abortion rights.

The former New York mayor tops Republican national polls in the quickening 2008 race, but was unable to win over a cross-section of a crucial party voting bloc at a huge "Values Voter" conference in Washington.

In a presidential candidate straw poll of 5,775 evangelical voters at the meeting and online, former Massachusetts governor Mitt Romney came out on top, narrowly ahead of former Arkansas governor Mike Huckabee.

.....The poll may also have been susceptible to stacking of online votes by campaigns -- Huckabee won 51 percent of votes of 952 people who voted in person at the conference, and Romney took only 10 percent.

Huckabee seems to have made a good impression. This is a uniquely friendly crowd no doubt. Of course the knock on him has always been that he does really well in retail politics but just can't get the organization and funding together to make a nationwide run work.

I speaka da English real good

2007-10-08T13:20:00.000-07:00

CNN, October 8, 2007: Arrests made in Memphis football player slaying

Three men were charged Monday in the fatal campus shooting of a University of Memphis football player, authorities said.

Taylor Bradford, 21, was shot September 30 shortly before police found him fatally wounded in his car, which had crashed into a tree.

All three men were charged with murder in the perpetration of attempted aggravated robbery.

.........There will be a moment of silence at a football game at the university the night after Bradford was killed.

Gotta love those time traveling journalists.

Of course this is from the folks who conveniently put a button to adjust the text size at the top of the story in small light gray text. If you can find it you don't need it.

Ricardo is Dead

2007-10-02T15:22:00.000-07:00

Thomas Palley: Jack Welch’s Barge: The New Economics of Trade

The classical theory of comparative advantage has driven US trade policy for the past fifty years. That policy, in combination with technical innovations that have lowered costs of transportation and communication, has opened the global economy. Yet paradoxically, this opening has rendered classical trade theory obsolete. That in turn has left the US economically vulnerable because its trade policy remains stuck in the past and based on ideas that no longer hold.

The logic behind classical free trade is that all can benefit when countries specialize in producing those things in which they have comparative advantage. The necessary requirement is that the means of production (capital and technology) are internationally immobile and stuck in each country. That is what globalization has undone.

Several years ago Jack Welch, former CEO of General Electric, captured the new reality when he talked of ideally having “every plant you own on a barge”. The economic logic was that factories should float between countries to take advantage of lowest costs, be they due to under-valued exchange rates, low taxes, subsidies, or a surfeit of cheap labor. Globalization has made Welch’s barge a reality. However, in doing so it has made capital mobility rather than country comparative advantage the engine of trade. And with that change, “free trade” increasingly trades jobs and promotes downward wage equalization.

The U.S. and European response to Welch’s barge has been competitiveness policy that advocates measures such as increased education spending to improve skills; lower corporate tax rates; and investment and R&D incentives. The thinking is increased competitiveness can make Europe and the US more attractive to businesses.

Unfortunately, competitiveness policy is not up to the task of anchoring the barge, and it can even be counter-productive. The core problem is corporations are globally mobile. Thus, government can subsidize R&D spending, but the resulting innovations may simply end up in new offshore factories. Moreover, competitiveness policy easily degenerates into a race to the bottom. For instance, if the US cuts corporation taxes, other countries may match to stay competitive. The result is no gain for the US, while profit taxes are lowered and tax burdens shifted on to wages, which widens income inequality.

Worse yet, capital mobility prompts countries to adopt unfair policies to increase their relative business attractiveness. These policies include disregard of environmental damage; suppression of labor to keep wages low; direct subsidies; and under-valued exchange rates. All are visible in China, which is the poster-child for such abuses.

A critical consequence of Welch’s barge is the creation of a “corporation versus country” divide. Previously, when corporations were nationally based, profit maximization by business contributed to national economic success by ensuring efficient resource use. Today, corporations still maximize profits, but they do so from the standpoint of their global operations. Consequently, what is good for corporations may not be good for country.

.....The emergence of barge-like corporations has reduced the scope for effective competitiveness policy, increased the temptations for unfair policy, and created a wedge between corporate and national interests. This poses two critical policy challenges. First, there is need for rules against unfair competition, which is where exchange rate rules and labor and environment standards enter.

Second, there is need to close the wedge between corporation and country. In the U.S. that calls for such measures as ending preferential tax treatment of profits earned offshore; making it illegal for corporations to reincorporate outside the US to escape US tax laws; and new tax arrangements that encourage jobs and value creation within the US.

......These economic challenges are compounded by political difficulties. In Washington, elite policy thinking is funded and lobbied for by corporations. Consequently, corporations control trade policy at a time when corporate interests differ from the national interest. That is also increasingly true in Brussels. Fifty years ago what was good for GM may really have been good for the US. With Jack Welch’s barge, that may no longer hold.

Ricardo's point was tied to agricultural products, where different climates and terrains along with the developed skills of the workforce allowed for a "comparative advantage" in production (it being more efficient to grow grapes in Portugal and Sheep in Britain as I recall). This still holds true as far as it goes. It is much more efficient to grow grain in Ohio and Oranges in Florida and trade them than to try to grow Oranges and Wheat both places. The problem begins when we start talking about multinational corporations in the same terms as 19th century farmers. Production has become separated from Resources due to the transportation revolution which has made it possible to bring the raw materials to the worker rather than vice versa (as well as the depletion of resources near Western industrial areas). Knowledge has been abstracted from the worker with the rise of the engineer and the decline of the skilled trades worker. A multinational will use the knowledge gained by advanced research in high wage research labs to develop (perhaps in a mid wage country) the product they will produce in a low wage country. Today, a Multinational can afford to bring resources and expertise to the lowest cost worker and then transport the finished product to a high cost environment and still have a profitable arbitrage. This works spectacularly until enough high wage workers are replaced with low wage workers and the formerly high wage economy collapses.

China is a symptom, not the problem. As China suffers from inflation, manufacturers will move to other desperate low wage countries where the same phenomena will play out.

"Terrorism" has jumped the shark

2007-10-01T11:13:00.000-07:00

The Newspaper:Chicago, Illinois Suburbs: No Mercy Speed Traps

Police in Chicago, Illinois suburbs are citing terrorism as a reason for "no mercy" speed traps where every motorist stopped by police -- other than fellow police officers -- receives a traffic citation. A Chicago Sun-Times analysis found that a total of thirty towns had a policy where more than 90 percent of drivers stopped must be ticketed.

"There's a lot of people who come in and out, and with all this terrorism and everything else that's going on, we have zero tolerance," North Chicago Police Sergeant Sal Cecala told the Sun-Times. "There's no breaks for the officers to give."

I still remember working the Christmas after 9/11 at an ecommerce distribution center. They tried to play the terrorism card there claiming the increasingly intrusive searches of employees. Of course they only searched us on the way out.....

But in the present Republican "Liberty through Tyranny" environment I'm sure Officer Cecala is on the short list for Guiliani's cabinet.

Thompson

2007-09-08T17:22:00.000-07:00

I have heard lots of speculation about how the entrance of Fred Thompson affects the Republican primary race. The stories I have read and listened to focus on which candidate Thompson hurts. I think the interesting thing is who Thompson helps.

I think Thompson entering the race is a huge boost to Rudy Guiliani. At the moment there are several candidates all fighting to be the "true conservative" (generally defined in terms of social, fiscal, and defense policy). Guiliani can't do the normal social conservative business credibly so he has targeted his focus on economic conservatives and national security conservatives (and a social conservatism of a non-sexual sort as witnessed by his run ins with the ACLU in New York). He's done a pretty good job and probably can lock a lot of the Northeastern and Western Republicans (and quite a few "social conservatives" who are afraid of Al Quaeda attacking Peoria and/or like a "strong leader"). Meanwhile Thompson, Romney, Huckabee, and the midgets will beat each other's brains in fighting over the Southern and Midwestern voters. If the Social Conservative vote is fragmented 3-4 ways, Guiliani could win it all with a minority. Assuming McCain doesn't rise again I could easily see it happening.

The Republican party is in the middle of sorting out the lessons of the Bush administration. There is a sense thing have gone wrong and someone should be thrown under the bus. The loudest voices so far are the economic and national security conservatives bellowing that this is what happens when you let those Bible thumpers in the bus instead of under it. On the other extreme, you have Mike Huckabee and "the Party of Sam's Club" trying to find a Republican form of populism.

Once Again

2007-09-08T15:03:00.001-07:00

the Administration has played the Congress:

TruckingInfo: U.S., Mexican Trucking Firms Cleared To Cross Border

Stagecoach Cartage and Distribution from El Paso, Texas, was given approval to operate in Mexico late Thursday night, and Transportes Olympic of Nuevo Leon, was cleared to operate in the United States.

You may recall that Congress, with great fanfare, passed a bill to stop the administration from ramming the Mexican trucks program though by erecting a series of hurdles the administration would have to clear before authorizing the program. The administration of course half-assed its way through the hurdles in less than two months and promptly rammed the the Mexican Trucks program through. I don't understand why everyone is ragging on Sen Craig given how Congress seems to always come running when the President taps his foot.

Dishonesty Perturbs Me

2007-09-04T13:41:00.000-07:00

Fortune Magazine:Trucking Cos Want Gov't to Keep Limits

U.S. trucking companies want the government to keep regulations allowing truckers to drive 11 hours in a row, rather than the previous limit of 10.

The American Trucking Associations filed a petition Friday with the federal government asking officials to issue a new version of two-year-old regulations on truckers' hours to replace regulations struck down by a court in late July.

The trucking group argued that since the court's late July ruling was focused on procedural issues rather than safety concerns, the Transportation Department should keep similar regulations in place.

The DC Appeals Court ruling (PDF) paints a different picture however:

Public Citizen notes that the TIFA data, upon which FMCSA’s time-on-task multipliers were ultimately based, indicates that “the risk of fatal-crash involvement more than doubled from the 10th hour to the 11th.” Public Citizen Br. 48-
49 (citing 2005 RIA at 45 (J.A. 1665)). The actual time-on-task multiplier for the eleventh hour used in FMCSA’s model, however, was “only 30% higher than the . . . multiplier for the 10th hour.” Id. at 49 (citing 2005 RIA at 61 (J.A. 1681)). Public Citizen contends that the two steps FMCSA used to transform the TIFA data into the time-on-task multipliers were unexplained, and that they had the effect of improperly minimizing the crash risk associated with the 11th hour of driving.

First, as explained above, instead of using the crash risk figures for each hour of driving that the TIFA Study had calculated directly from the actual crash data, FMCSA derived a cubic curve of crash risk as a function of time on task. To derive the curve, FMCSA first plotted the TIFA figures for Hours 1 through 12, and then used an aggregate measure for Hour 13 and beyond. It did not, however, plot the 13+ figure at Hour 13, but rather at Hour 17. See 2005 RIA at 59 (J.A. 1679). As shown in the accompanying graph, the curve that fit those 13 points yielded a crash risk at Hour 11 that was substantially below the figure that the TIFA Study had calculated directly from the actual crash data.

Basically at the 11 hour mark the red dot marks the real crash risk as measured in the study, the black line marks where the agency tried to pretend the risk was. So the "procedural error" was cooking the books to understate the risks that the rule was exposing the public (inclusive of truck drivers) to. Keep in mind the scale of the jumps as well, the risks in the 11th hour doubled. By the way the same court 3 years ago "expressed “very real concerns” about the increase in the daily driving limit from 10 to 11 hours." and commented that the FMCSA's model "understated the risks of driving 11 hours." So this is not about some form that was not filed correctly, this is about a serious safety issue that the court brought to the Agency's attention the last time the rule was struck down which the Agency tried to conceal this time by a dishonest manipulation of the data. This Gonzalesesque obsfucation did not have a discernable purpose other than to justify the unjustifiable. Some of the findings in the ruling were about violated procedures but this was not just about a "procedural error"

Mortgages and the People who write about them

2007-09-04T13:29:00.000-07:00

Calculated Risk:MMI: Staying Ignorant in Five Easy Steps

Tanta at Calculated Risk takes apart a Marketwatch fluff piece on how to get a mortgage in a credit crunch. The article and the comments give a much better picture of the realities of the mortgage market than most of the stories pulled off the evergreen pile in the MSM.

The Onion, of course, has something to contribute as well.

Sometimes Satire is More True than the News

2007-08-25T10:59:00.001-07:00

The Onion Rocks

GM is moving forward

2007-08-24T11:33:00.000-07:00

CNN:GM unveils diesel-like gasoline engines

General Motors revealed two drivable concept cars with new engines that burn gasoline in virtually the same way that a diesel engine burns diesel fuel.

The engines will get 15-percent better fuel economy than ordinary gasoline engines, GM estimates, but will not need the expensive exhaust treatment that diesel engines require.

Several car companies have been working on this type of engine technology, commonly known as homogeneous charge compression ignition, or HCCI. The technology promises the fuel economy of a diesel engine, which is typically much more efficient than a gasoline engine, but with the much cleaner exhaust of a gasoline engine.

It only works on a warm engine under light load right now but this looks promising to cut cruise fuel consumption for smaller engines that cannot use variable displacement. If they can extend the operating parameters farther out this could give hybrid-like boosts to fuel economy without the weight and cost of batteries.

Pretty Nifty

2007-08-23T15:45:00.000-07:00

There are some new ideas for B-Trains that look to make the combinations more maneuverable.

The Denby/Fliegl systems in Europe use a countersteering lead trailer (like a tillerman on a fire department ladder truck) to enable the combination to safely negotiate tight turns.

The HECT trackaxle (HECT stands for High Efficiency Container Transport) in Australia uses swiveling 4 axle bogies (similar to the design of "Trailer Train" railcar sets) to allow tight turns.

This playing field looks a little crooked

2007-08-23T14:03:00.000-07:00

Land-Line: Mexican Truckers Promised Financial Help

Mexican motor carriers selected to participate in the proposed cross-border program could receive financial assistance from the Mexican government to make them more competitive.

Apparently, government financial assistance has been promised to truckers and trucking companies that participate in the cross-border program to help them carve out a competitive edge. The money would be used to develop infrastructure like loading docks, support trucks and light-service trucks – elements that would make their business operations more competitive with their U.S. counterparts, according to a translated article from the Mexican publication T21.

Tirso Martinez, president of CANACAR – a Mexican trucking association – said in the article that the funding was approved by the Mexican Secretary of Economy, but had not yet been put in place.

So, in addition to cut-rate wages, US truckers will be disadvantaged by direct subsidies to Mexican trucking firms. It's a good thing the Administration's rush to get the Mexican trucks program rammed through by January 09 is all about allowing the "free market" to work.

Mexican trucks will also not have to meet US emissions standards and can fuel up with high sulphur (ie cheap diesel) before crossing the border. The average US fleet faces over $20,000 in extra lifecycle costs per power unit due to the new emissions standards for trucks and spends and extra 5 cents a gallon for Ultra-Low Sulphur diesel (or about $5,000 over each tractor's lifespan) to keep the emissions systems working. I like clean air, but if it's important enough for American and Canadian carriers to pay for it should be important enough for Mexican carriers to pay for too.

That Didn't Take Long

2007-08-19T16:17:00.000-07:00

Yahoo: Investors fixate on Fed in hopes of new rate cut

WASHINGTON (AFP) - Investors are fixating on the Federal Reserve after its discount rate cut Friday, hoping the US central bank will take stronger action to ease the credit crunch roiling markets worldwide.

The Fed took markets by surprise Friday by slashing its discount rate, the interest rate charged on loans to commercial banks, by a half-percentage point to 5.75 percent.

Equity markets cheered the decision, announced before Wall Street opened: the Dow Jones industrial jumped 1.82 percent, the first time it closed higher in seven sessions. The news lifted the major European stock markets out of earlier losses.

Yet the central bank did not touch its key federal funds rate -- the overnight rate banks charge each other -- despite investor cries for relief.

Man, those Wall Street boys sure are a bunch of spoiled rich kids. The Fed steps in Friday and before the weekend is over they're bleating like stuck sheep.

Privatization and the Loss of Sovereignty

2007-08-19T09:23:00.000-07:00

THe Nation: The NAFTA Superhighway

In my conversations with people in Texas, it seemed that the privatized nature of the road was what got folks the angriest. Bad enough that drivers would face tolls, that ranchers would have their land cut out from under them, but all for the financial gain of a foreign company?......

"What really drives this is economic," activist Terri Hall told me. "It's about the money. We're talking about obscene levels of profit, someone literally being like the robber barons of old. And this is one thing that government actually does well, build and maintain roads."

Hall is an unlikely defender of the public sphere. A conservative Republican and an evangelical Christian who home-schools her six children, she first got interested in road policy when TxDot announced plans to toll the road near her house, which runs into San Antonio. Outraged, she brought it up with her local State Rep, and when that didn't work, she began organizing. She founded the San Antonio Toll Party (like the Boston Tea Party, she notes) by pamphleting at intersections and calling friends. "It's really like the old days, during the American Revolution...just fellow citizens trying together to effect change."

.....Hall had arranged to meet me in the San Antonio exurbs, in a home design center that doubled as a cafe. Outside, a thunderstorm lashed the windows with rain. As she spoke, her newborn son propped next to her swaddled and napping, it occurred to me that she was living the twenty-first-century version of the American dream. She and her husband had moved to Texas from California in pursuit of cheap housing, open space and a place to raise their family. Their web-design business was successful; their children healthy. Why, I found myself thinking, was she so upset about a road?

[Texas Transportation commissioner] Ric Williamson must often ask himself the same thing. Just as the White House was blindsided by the opposition to the Dubai ports deal, just as NASCO was shocked to find that a simple schematic map attracted angry phone calls, just as the Commerce Department was shocked to find a simple bureaucratic dialogue the subject of outrage, so too have Perry and Williamson seemed ambushed by the zealous opposition of people like Hall.

But what people like Williamson don't seem to understand is how disempowered people feel in the face of a neoliberal order whose direction they cannot influence. For corporatists within both parties (Williamson, it should be noted, was a Democrat while in the Statehouse), selling port security or road concessions to a multinational is inevitable, logical, obvious. To thousands of average citizens in Texas and elsewhere, it's madness or, worse, treason. Both the actual TTC and the mythical NAFTA Superhighway represent a certain kind of future for America, one in which the crony capitalism of oil-rich Texas expands to fill every last crevice of the public sector's role, eclipsing the relevance of the national government as both the provider of public goods and the unified embodiment of a sovereign people.

For Williamson, this is progress; for Hall, it's an outrage and a tragedy. "We have so little control over our own government," she told me, the alienation audible in her voice, thunder punishing the air outside. "We are really the last beacon of freedom in the world--the land of the free and home of the brave--and we're letting it slip away from under our noses."

That's the Upshot of both the left and the right, whether it is the World Trade Organization or Cintra, unelected entities are being handed control by Federal and State governments unable or unwilling to do their historic jobs. Citizens expect to have a voice at the ballot box on trade policy, the building and administration of roads, and all of the other things governments do. The Democrats with their slavish devotion to multinational political organizations and neoliberal trade polices and the Republicans with their devotion to multinational corporations and privatization both are choosing to hand over more and more control to these entities, and neither sees a problem.

The job market that has gotten much nastier and much harder to predict. Service sector jobs that may have seemed safe from trade are becoming tradable. Thousands of corporate jobs disappear overnight when financial engineering runs awry. Health insurance is getting stingier and retirement is a source of anxiety, not comfort. You can work hard and a decision half a world away by someone who you've never laid eyes on can take away your benefits or send you out on the street.

Is it any wonder folks are yelling "whoa!"?

He's tanned, rested, and ready......

2007-08-06T11:39:00.000-07:00

to run another business into the ground.

Bob Nardelli, late of Home Depot, is taking over the Top Job at Chrysler.
I feel bad for any of the employees who haven't taken a buyout yet. The Private Equity chimps deserve every bit of what they will get.

Out of Touch

2007-07-30T06:43:00.000-07:00

Michael Barone: Our National Funk

Most strikingly, only 25 percent of Americans are positive about the direction of the nation, down from 41 percent in 2002. In only a handful of the 47 nations are there declines of similar magnitude -- Uganda, the Czech Republic, France, Canada and Italy. Obviously, one factor here is the decline in the job rating of George W. Bush and of Congress (and the response in other countries to squabbling politicians in Prague, Paris, Ottawa and Rome).

......That's my reaction as well to the finding that by a two-to-one margin Americans say their children will be worse off than we are. There's a similar response in Canada, Britain and Brazil. The even more negative verdicts in Western Europe and Japan can be explained as a cool assessment of the combination of low birthrates and overgenerous welfare states.

But what basis do Americans have to suppose that, for the first time in history, a younger generation will be worse off than their parents? Perhaps it's just a feeling that things cannot possibly get any better. In any case, we seem to be in a pronounced national funk.

We might take some comfort in some of the trends of opinion in the rest of the world. In China and India, large majorities think the next generation will be better off -- a vote of confidence in their surging economies, which are providing cheaper products for us and are growing as markets for American goods and services. In Latin America, most believe that people are better off with free markets. (The highest percentage was in Hugo Chavez's socialist Venezuela!) In Africa, most express great optimism in the future -- a sign that the world's most troubled continent may be at last turning around.

Barone seems to be blissfully unaware of who the winners and the losers are in globalization. The Chinese and Indians who are "pollable" are by and large the winners, people in the prosperous urban elite who see their prospects and their nation ascendant. American workers, are by and large the losers. Average wages are flat after inflation. The nation is bogged down in Iraq, which only adds to the looming national debt disaster. The news about trade is by and large negative (4,000 workers laid off, engineers training their replacements from Mombai while executives complain that our education system is not turning out enough qualified engineers. Mr. Barone needs to get out more, perhaps he should go back to Detroit and talk to some ordinary people about what they see and how they see the world.

Hours of Service: Here We Go Again

2007-07-24T14:58:00.000-07:00

TTnews: Court Issues Split Ruling on Drivers’ Hours of Service Rule

A federal court issued a split ruling Tuesday on the government’s rules governing truck driver hours of service, rejecting a petition by a group representing owner-operators but granting a separate request by a public safety advocate group.

.....“We are analyzing the decision issued today to understand the court’s findings as well as determine the agency’s next steps to prevent driver fatigue, ensure safe and efficient motor carrier operations and save lives,” FMCSA said. “This decision does not go into effect until Sept. 14, unless the court orders otherwise.”

The court vacated the portions of the rule that extended the maximum allowable driving time to 11 hours from the previous limit of 10, and eliminated the so-called 34-hour restart, which allows drivers to reset their maximum allowable hours in a week.

The ruling maintains the limit for drivers’ work time of 14 consecutive hours. Previously, the agency had allowed drivers to work for 15 hours per day, but had let them clock on and off duty.

Not much of a surprise. The administration seemed to be unwilling to admit "no means no" the last time the rules were thrown out as arbitrary and capricious. Perhaps they will create a rule centered on safety this time (there were some improvements from the old rule, but not enough). It's problematic when you admit you are going to kill more people with your new rule, but the value of their sacrifice will be outweighed by the cost savings for shippers. Myself I think a simple rule is better, the current system (no more than 14 hours working/11 hours driving then 10 consecutive hours off [unless you split break], 70 hours in 6 days/80 hours in 7 days [except after 34 hours off] is a mess. All that and it does not address circadian rhythm. EOBRs tied to the truck and GPS are essential to make whatever rule they impose mean something.

Of course the Supreme Court has changed since last time the rules were rejected by the DC circuit so perhaps this time they will go for broke.

Snowbirds might live longer

2007-07-23T12:11:00.000-07:00

WSJ Economics Blog:Head Toward Heat and Live Longer

Leaving the cold Northeast states for the warmer South and West may mean a longer life.

New research on the effects of extreme temperatures found that 5,400 deaths a year are delayed by getting away from cold temperatures. The life expectancy for people whose death were delayed by moving increased by an average of 9.1 years, according to a study published by the National Bureau of Economic Research.

Economists Olivier Deschenes at the University of California, Santa Barbara, and Enrico Moretti at the University of California, Berkeley, matched data on deaths from 1972 to 1988 to weather conditions on the day of death and county of residence.

Extreme temperatures — both hot and cold — generally tends to spur a spike in deaths. That’s evident from the increased public attention from heat-related deaths, which hit elderly people especially hard. But deaths actually decline significantly in the days that follow, suggesting that the extreme heat hastened the deaths of people who were already weak and would’ve died anyway. “As a consequence, there is virtually no lasting impact of heat waves on mortality,” the researchers write.

Extreme cold weather leads to an immediate spike in deaths as well, but it isn’t offset by a decline in deaths afterward. One extremely cold day in a 30-day window increases mortality by 10%, the study found, mostly the result of cardiovascular and respiratory diseases (leading to hypothermia, pneumonia and other heart or lung problems). People in low-income areas are hit especially hard, as are infants and older adults.

Overall, cold weather accounts for 1.3% of total U.S. deaths a year, a larger impact than homicide, leukemia or chronic liver disease. The researchers note that Minneapolis, Detroit, Cleveland and Chicago are affected the most; as many as 3.3% of their deaths could be delayed by changing exposure to cold days.

The research could help explain the increase in life expectancy over the last three decades, about a quarter of a year per calendar year. The population shift from cold states to warm states, the study found, accounts for 8% to 15% of the gains in longevity.

Who knew? Maybe the big 3 will solve their pension issues by requiring retirees to live in Michigan to get a pension....

Good Night and Good Luck

2007-07-22T14:15:00.000-07:00

Shakesville on the New Executive Order via Ezra Klein

Under this order, the Executive Branch can ’starve out’ a person by completely freezing their assets, without trial, without the need to present evidence, and without appeal. The Treasury Secretary has sole discretion to determine who is in violation of this order, in ‘consultation’ with the Secretary of Defense and the Secretary of State. That last part is verbiage; Treasury has the power per this order. Even better, the Secretary of Treasury has the explicit authority to delegate this decision to any flunky or flunkies of his choice per Sec. 6. This order applies to all persons within the United States. If Treasury declares that a person is a ‘SIGNIFICANT RISK’ to commit violence in Iraq, or a ‘SIGNIFICANT RISK’ to support violence in Iraq in any way, or to have assisted in any way a person who is a ‘SIGNIFICANT RISK’ to do so, all their assets are to be immediately frozen.

It is a further violation of the order to make a donation to such a person whose assets have been frozen. (I was being literal when I said ’starve’ them. Such a person would have no legal means of acquiring food, clothing, or shelter. They couldn’t buy it with frozen assets, nor accept it as a gift, and stealing is already illegal.) [See here for the statute on which Bush relies to issue this order.]

Section 5 says that these actions will be taken by the government without any notice to the person whose assets are to be frozen. I see no procedure listed for any appeal from this action to anyone. In theory, a person could argue the matter in federal court. However, merely donating legal services to represent such a person would apparently be a violation of Sec. 1(b). The odds of an unrepresented person successfully challenging an executive order, when said order will be defended by a phalanx of Justice Department lawyers, are low.

Is that scary enough for you? When I first read it, I checked the site to make sure it wasn’t a spoof of some sort, a la the Onion. I may have missed something, but I hit the high points.

Oh, I probably don’t need to mention the obvious, but the lack of due process, lack of evidentiary requirements, and the vagueness surrounding exactly what constitutes a violation make this order a totalitarian dream. And there is no end to the ‘daisy chain’ it creates, either. If you donate money to a person whose assets were frozen because they gave money to a person who was declared to be a ‘significant risk’ to commit or support violence in Iraq, then you are subject to the order, subject to have your assets frozen, and anyone helping you thereafter gets the same treatment. This order is far in excess of the presidential orders from 20+ years ago that were circulated to make us afraid of the government. (FYI, there’ve been executive orders since at least Kennedy that declares the feds are in charge of everything in case of nuclear attack and such.)

Of course, the administration has demonstrated a) the willingness to use the levers of government for political means (see: Goodling, Monica) and b) an absolute indifference to public opinion, and, on a semi-related note, the belief that they don't have to enforce laws that inconvenience them or force them to answer uncomfortable questions

Will 2008 be another 3 way?

2007-07-21T18:56:00.000-07:00

Race42008:Is There a Viable Third Party Candidate?

The coming presidential election is just the sort of contest that cries out for a third-party protest candidate into whom the voters can channel their collective angst. That’s because 2008 is shaping up to be a year in which voters are disgusted with both parties, demonstrated by the equally dismal approval ratings of President Bush and the Democratic Congress. Further, of the leading presidential contenders on either side of the aisle, none has yet been able to connect with voters’ “mad as hell” sentiments towards all things Washington. Lecturing the electorate on why they shouldn’t be mad as hell isn’t going to help. Nor will pointing fingers at the other party, as Democrats are wont to do. Americans once again feel that their representatives in government have forgotten just who owns this country, and they’re out for blood. And they’re going to get it. One way or another.

Consequently, the MSM, sensing that we are once again about to see a 1968 or 1992 style electoral debacle, has been coronating one Michael Bloomberg as the latest incarnation of Ross Perot, a third-way kinda guy who will tell it like it is and spoil the election for the Republicans. Indeed, even I bought into the Bloomie schtick until recently. But I have since been disabused of that notion for several reasons. Foremost among them is the simple reality of what sort of vacuum will exist in the race for 2008.

While many readers will disagree, and some rather vehemently, I believe that the two major party nominees will almost certainly be Rudy Giuliani and Hillary Clinton. I believe this to be the case for a number of reasons, none of which need be laid out in this post. Now, in such a race, there would almost certainly be room for a third-party candidate due to the vacuum that would exist in a general election campaign. But said vacuum would most certainly NOT be filled by Michael Bloomberg. Here’s why.

In a Rudy/Hillary race, the nation is faced with two major party candidates who are a) northeastern, b) pro-choice, c) pro-Iraq, and d) who have significant appeal to centrists of various sorts. With author Fred Siegel’s recent revelation that Bloomberg isn’t particularly anti-war, and with our own Aron Goldman’s discovery that Bloomie sees his role in the race as to fill a vacuum in the center, the rationale for a Bloomberg candidacy in a Rudy/Hillary race ceases to exist. To put it another way, we already have two relatively centrist, pro-choice, pro-war New Yorkers in the race — is there really room for a third? To ask the question is to answer it.

So if not Bloomberg, then who? Many observers will look to their left and opine that Ralph Nader could once again make waves. But does anyone seriously think that liberals will allow Nader to deny them the White House yet another time? Others will look to their right for that looming third-party pro-life candidate. But third-party candidates rarely come from the poles of American politics; a pro-life candidate running an abortion-centered campaign would annoy Team Rudy, but wouldn’t take more than 2 or 3 percent of the vote. In order for a third-party candidate to truly make waves, he has to fill the Rudy/Hillary vacuum. In short, we’re looking for a pro-life foreign policy realist from Middle America who, like Americans, is mad as hell.

I'm curious if someone will appear to challenge the big 2. Third Parties have been ridiculed as irrelevant, but they were important in 1992 and 2000 (though Nader's campaign never had any prospects besides a spoiler role). The time might be right. 50% of the populace claims to be unwilling to vote for Hillary no matter what. Guiliani and Thompson both have weaknesses as campaigners and may not wear well as the 'campaign that will not end' drags on. I think a Sam's Club Party could well break out.

They Play With Dogs

2007-07-21T18:05:00.000-07:00

CNN:Doctors remove 5 polyps from Bush's Colon

Afterward, the president played with his Scottish terriers, Barney and Miss Beazley, Stanzel said. He planned to have lunch at Camp David and have briefings with National Security Adviser Stephen Hadley and White House Chief of Staff Josh Bolten, and planned to take a bicycle ride Saturday afternoon.

Cheney, meanwhile, spent the morning at his home on Maryland's eastern shore, reading and playing with his dogs, Stanzel said. Nothing occurred that required him to take official action as president before Bush reclaimed presidential power.

I'm not sure what is weirder: that the two most powerful men in America seem to while the day away playing with their dogs; that their P.R. folks thought this was important enough to pass on to CNN; or that CNN thought it worthy of passing on to us.

Sleep tight, America, Homeland Security is on the job

2007-07-16T07:06:00.000-07:00

Fox News: 8-Year-Old Boy Held From Plane for Appearing on No-Fly List

An 8-year-old boy expecting to catch a plane home is denied entry for appearing on a terrorist no-fly list, reported MyFoxKansasCity.com.

Bryan Moore was set to catch his first plane trip when he arrived at an airport in Cortez, Colorado to fly home after visiting his sister, said the report.

"They almost got me scheduled in and then the lady just bowed her head and said, 'We can't get you on this plane, you're a terrorist,'" Moore said.

The soon-to-be third grader was red flagged as a threat to national security because his name popped up on the national watch list.

Maybe Chertoff had a gut feeling about him...

Economy Pinches Trailer Manufacturers

2007-07-16T04:54:00.000-07:00

Today's Trucking News:Trailers parked, new trailer shipments down in '07

The sluggish U.S. economy is to blame for a slowdown in the number of trailers being shipped to North American trailer dealers, according to trailer OEMs and industry analysts.
For the first five months of this year, total shipments were down almost 12 percentage points (11.8 percent) compared to the January-to-June period of 2006. And according to industry research experts A.C.T. Research, that number will probably be more like 15 percent by the end of the year.
....According to Chris Hammond, vice-president of dealer sales for Great Dane Trailers, hardest hit have been flatbeds. He attributes that to the U.S. construction slowdown. "Refrigerated trailers have been selling well, and dry vans are somewhere in the middle," he says.

The slump in housing and autos is taking a toll on the rest of the economy. Autos probably are a victim of all of the heavy incentive deals of the past few years which persuaded folks to buy a new car a year or two before they otherwise would have. Also light trucks are no doubt being hurt by the decline in construction (hurting work pickup buyers) and the rise in gas prices (persuading some lifestyle pickup drivers to move to cars)

Also, in the truck manufacturing industry there was a massive pre-buy to avoid 2007 Emissions standards, resulting in huge plunge 2007 model year truck sales. Trucking companies did not want to pay $7000 more for a truck that weighs more and has more things to break. Here we are also paying for the sins of the EPA in moving the 2004 mandate up 2 years (via a lawsuit against the engine makers for merely meeting the rules). The resulting engines and trucks were half baked, causing higher prices, losses in fuel economy and many, many breakdowns. Eventually (around the original launch date) the manufacturers got all the issues sorted out. This convinced most people that the hot ticket was to buy the year before and let someone else deal with all of the hassles of owning the latest EPA experiment.

Soldiers are not policemen

2007-07-15T14:41:00.000-07:00

The Nation:The Other War

The Occupation of Iraq has only lead to grief. Any foreign army facing an insurgency is going to do all sorts of things that increase the support for the insurgents. I remember when Republicans spoke disdainfully about Nation-building.

Same old song, next verse

2007-07-15T12:56:00.000-07:00

Jame Wolcott riffs on Fred Thompson's video "appearance" at the National Right to Life conference (sort of a remix of the 1984 talking head with Father knows best):
I'm sorry I couldn't be with you in person, but all my good shirts are at the dry cleaner's.

That's the thing, the pro-life movement has accepted second class treatment from Republican Presidential Candidates and Presidents far too long. If they don't want to be seen with "our kind" why should we give votes to "their kind"?

If only it was a dilemma for business

2007-07-09T13:54:00.000-07:00

Thomas Palley: The Profit vs.Country dilemma

Free market societies need separation between market and government, intermediated by constitutional democracy. In the 20th century many countries suffered from excessive government control over market activities, and they paid a heavy price. In the 21st century America risks paying a heavy price from the reverse problem of allowing excessive corporate influence over government.

This is a huge danger, yet it is off the political radar. One reason is that business funds both Republicans and Democrats, thereby silencing both. A second reason is that much of the public believes businessmen are smart and can run government well - after all they are rich. Put the two together, and it is easy to see why business executives move seamlessly from Wall Street and corporate boardrooms to top government policy offices on Pennsylvania and Constitution Avenues.

We're coming around to the idea that what's good for corporate America is not always what's good for America when it comes to environmental policy, I wonder how long it will take this awareness to extend to trade policy?

Ice Road Truckers

2007-07-08T21:14:00.000-07:00

Caught the first 4 episodes tonight. Is it just me or is Hugh a bit of a whiner? He's always badmouthing his employees. If he really think his folks are all lazy and stupid then maybe he should go find somebody else to drive his clapped out trucks rather than gossiping like an old woman. It's not like there is a shortage of folks with HGV licenses in Canada.

Hollywood is out of Ideas

2007-07-08T21:08:00.000-07:00

Superman Returns, Die Hard 4, Rocky whatever the hell number it is they are up to, and now Alvin and the Chipmunks

I wonder how long it's going to take for them to exhaust remotely viable old series (serieses?) to cannibalize for Movie ideas, my prediction for the next decade is they'll move to classic commercials for movie ideas, first up: Where's the Beef?: The Movie

A Wedged Bear in a Great Tightness

2007-07-08T12:27:00.000-07:00

Stumbled on an interesting discussion between two historians about the future of US involvement in Iraq
Sally Marks: Whither Iraq?

A few people, including Senator Joseph Biden and General Anthony Zinni, worry that if we leave and Iraq explodes, the whole Middle East will explode as well. If that happens, we shall be immensely lucky if the only serious consequences for us are skyrocketing oil prices, leaving us nostalgic for the days when gas was only $3.50 a gallon and we could afford to heat our homes, and a global recession or depression. But we might not be so lucky, and our government–or another player--might commit a new blunder in Iraq, Iran, or elsewhere–which brings us to the worst case of all, nuclear war.

Of the nuclear powers, Russia alone is an oil exporter. However, though it no longer borders on Gulf states, it still considers the Persian Gulf part of its Near Abroad, meaning its backyard which it regards much as
the United States has long viewed the Caribbean. Of the others, China is extremely oil thirsty and a power to be taken seriously as it emulates American development of a century ago and quietly penetrates much of Africa economically while buying up our debt and financial firms. India is thirsty, too. Pakistan, to the east of Afghanistan, is Sunni, an oil importer with a precarious pro-American president and an army and intelligence leadership inclined toward Islamic fundamentalism. It and
India, both nuclear states, are perpetually on the brink of war over Kashmir. In the Middle East itself is Israel, nuclear and a likely monkey wrench in possible solutions. Then there is Europe, including two nuclear states (Britain and France) plus Germany, and the United States, as well as non-nuclear Japan. Historians famously do not predict, but it
is obvious that the scramble for oil or other unstable factors and perhaps blunders in the Middle East and related areas could create a crisis leading to a global explosion. Clearly, the time for oratory about victory or defeat is past. Concentration now should be on limiting the disaster and doing our utmost to ensure it does not turn into utter
catastrophe.

Among the imponderables is the problem of Al Qaeda, which gained entry into Iraq during the chaos after our conquest and has since spread, becoming brutally inventive. We pursue it, but our main focus is on Baghdad, where progress is slow and the Iraqi army’s ability to hold what US forces gain is questionable. Along with other insurgencies, we must deal with Al Qaeda, though rhetoric about “If we don’t fight them there, we’ll have to fight them here” is nonsense. Al Qaeda will attempt further atrocities here, whatever we do in Iraq. Beyond pursuing it (preferably with the aid of tribal sheiks) and trying to train a reliable Iraqi army and police, if that is possible, we must restore the Gulf balance of power in order to keep the peace. For a year, I have queasily wondered whether we would end up with our troops in several heavily fortified bastions watching Iraqis slaughter each other. That is now being discussed. In any event, it seems unlikely that any American president will seriously consider full withdrawal in the next five or six years at least, given all the potential consequences.

David Kaiser: Options in Iraq

I certainly agree that the United States government has brought an almost unprecedented catastrophe upon us, similar in some ways to the Austro-Hungarian decision to attack Serbia without sufficient diplomatic preparation in 1914, although nowhere near as serious, since Iraq is not on our doorstep and since nations no longer field armies in the millions. However, it is possible--actually, I think, probable--that what we have done (which cannot in any case be undone) is to accelerate something that was already happening: the rise of Islamic fundamentalist movements and the eclipse of the regimes that have ruled much of the region in cooperation with western powers since the 1950s. This has been happening for a long time. Iran, of course, overthrew its American client ruler in 1979. Earlier, Iraq had become an anti-western, totalitarian state, albeit one that could play a role in maintaining a balance of power in the region (as she points out), and one which, alas, allowed most of its people to live normal and even productive lives while nurturing an active middle class--things which Iraqis (except in Kurdistan) are now unlikely to know for decades. Pro-western regimes have been losing ground in Egypt since Sadat's assassination, and the Saudi kingdom is in many ways not pro-western at all. Pakistan is heading down the same road. Meanwhile, Hamas and Hezbollah are gaining.

The issue we face is whether keeping troops in Iraq, as Prof. Marks wants to do, will help arrest this trend. I think it is far, far more likely to accelerate it. Western occupation is a terrifically effective target for Islamist movements. To put it bluntly, it proves (to millions of Arabs) that we are just as bad as they say we are. What we have in the non-Kurdish areas is our own version of the West Bank, but without settlers. There is no reason to believe that we shall be any more successful than the Israelis have been in securing popular Arab support for our presence or even in dealing with opposition. (Our intelligence is never going to be anywhere near as good as theirs.)

Iraq, she says, is fragile, but indispensable. Well, so was the Austro-Hungarian empire, as it turns out, but it died anyway. As Peter Galbraith has pointed out, Iraq for the moment is the only survivor of four multi-ethnic states created after the First World War, the others being Yugoslavia, Czechoslovakia, and the Soviet Union. There really is no evidence now that any major group in Iraq wants a truly united, pluralistic Iraq (although the Sunnis would like to return to the days that they ruled the roost and some Shi'ites would like to dominate the Sunnis.) I don't see any reason for the United States not to encourage a de facto partition, under some "autonomy" scheme, combined with some peaceful population transfers, before all the transfers are accomplished through mass violence.

The problem of course is getting loose without triggering the worst case scenario is going to be fiendishly difficult, akin to removing all of the cards of a Suit from a house of cards without collapsing the whole thing. Turkey's army is poised at the border, itching to take the war to the Kurds. Iran and Saudi are both involved in proxy war. Once we head for the door will will have no friends inside Iraq (or perhaps rather everyone will be honest about their friendship or lack thereof with the US). We are in a horrible predicament, one that is going to become more clear, and more dire, with the passage of time. Coupled with that, if the new president cannot get free, the domestic political dynamic is going to get even uglier.

Everyone is a temp now

2007-07-06T15:49:00.000-07:00

Chicago Tribune: Layoff fears part of 'new normal' via Mish

Unemployment is lower for better-educated workers than for other workers, in good times as well as bad, federal data show. But college-educated workers lose jobs more often now than they did 20 years ago.

"It appears that there has been an upsurge in job-loss rates for more-educated workers in the early and mid-1990s and again in the new century," writes a leading job-loss researcher, Princeton University's Henry S. Farber. "Job-loss rates for other educational groups show a cyclical pattern but no upward trend."

Income loss is greater too. The average earnings decline including lost raises was 21 percent for workers forced to find new full-time jobs between 2001 and 2003, four times the mid-1990s rate, Farber found.

Ray Ercoli heads a career ministry at Barrington's Willow Creek Community Church. He added volunteers and services in 2001 to help unemployed high-tech workers, but people kept coming after the economy recovered.

"The need we see now are older workers losing their jobs after being employed 15 to 20 years, usually at one company," he says. Some have that "deer-in-the-headlights look. They're not sure they're going to be able to land another job."

The article is pretty disturbing. Frequent unexpected Job loss has been the scourge of the working class for years, now everyone seems to part of this story. Businesses are becoming less and less inhibited about purging older workers and engaging in continual churn to keep wages low. This is happening while more and more of the risks in health care and retirement are being fobbed off on workers.

Congress is led by its wallet

2007-07-06T00:13:00.000-07:00

Jim Jubak:Congress Follows the Money on Energy

The names may change in Congress. Democrats may replace Republicans in the majority. But when it comes to energy legislation, the same rule always applies: Money talks.

So is it any surprise that agribusiness, a sector that gave $44.6 billion to Democratic and Republican candidates in the last election cycle, according to the Center for Responsive Politics, came out the big winner in the energy bill passed by the Senate on June 21? The oil-and-gas industry, which gave $19.1 billion as part of a natural-resources sector that gave $46.4 billion, didn't do too badly, either.

Never mind that Food prices are going through the roof thanks to the current Ethanol boondoggle and Energy Companies that are earning record profits somehow need tax breaks to stay in business (poor little rich boys, why they're regular Richie Riches)

Update: See also Mark Shea: What I mean by "Incestuous Political Class"

A voice from the past

2007-07-05T12:59:00.000-07:00

Claremont Review of Books: Sins of the Fathers (discussing Joseph Frank's analysis of Fyodor Dostoevsky's political thought)

Dostoevsky is a political thinker. It is one of the many merits of Frank's biography that he sees clearly that politics is a leading theme—in a sense, the dominant theme—of Dostoevsky's writings. Dostoevsky's deepest concern is the question of authority, who rules, and who should rule. Tentatively, we may say that his answer is that these four fathers should rule unconditionally and absolutely: God the Father; second, the fathers of God's church, such as Father Zossima; third, the Tsar, the father of his people; and fourth, the biological father, Karamazov.

.....Frank sees clearly that the novel equates the murder of Fyodor Karamazov and Ivan's revolt against God. Frank believes that this equation is a weakness in Dostoevsky's plot, and that it is not quite plausible, given the fundamental goodness of God's creation. But Frank fails to notice that the key to Dostoevsky's case for authority is that it is made in the teeth of what his own characters, and perhaps Dostoevsky himself, see as a serious question about God's justice. Anticipating Frank's analysis, and stating it more forcefully, Czeslaw Milosz observed (in his excellent essay "Dostoevsky and Western Intellectuals") that The Brothers is, at its heart, a meditation on the Russian intelligentsia's act of abolishing simultaneously the authority of God, the Tsar, and the paterfamilias.

Smerdyakov, the actual murderer, the illegitimate brother whose passions and countenance are altogether ugly, simply presents the true face of the intellectual Ivan, who is outwardly cultured, suave, and good-looking. Ivan is horrified as he discerns his own character with growing clarity. By the end of the novel, he goes insane. The crude and smirking Smerdyakov, consumed by hate, is the genuine expression of the liberal intelligentsia's revolt against the authority of the biological father, the father Tsar, the fathers of the Church, and God the Father. In this paternal foursome, the death of the authority of God the Father is the key to the deaths of the other three. For God the Father legitimizes all authority, according to Dostoevsky. When God's government is thrown into question, all government—that of the family, church, and state—is similarly upset.

In The Devils, Dostoevsky shows us the political future of Russia without the fatherhood of God and Tsar. In that novel, we see through the microcosm of a small provincial town what will happen when the leftist intellectuals take over in the name of socialism and communism. They are ruthless, they kill without a thought, they are willing to commit mass murder to realize their dreams. Their souls are at the farthest remove from the equality they preach. They are hateful tyrants.

It's an interesting way to tie together the threads of "tolerance" and the profound lack of tolerance manifested by its liberal proponents" . Of course Dostoevsky's remedy, absolute submission to paternal authority is flawed as well, which he acknowledges. It is also a little disconcerting that his belief in "submission" to the pater is eerily reminiscent of Islam (which from the other side is not that odd as both have a pre-Reformation philosophy).

Today we are threatened by the spawn of Benthamite liberalism in both the left's disdain for moral authority in personal morality and expression and the right's disdain for it in business and the limits to governmental power (at least when they hold Leviathan's reins). But going back to classical thought is not a clear path to safety. Dostoevsky may not know the way home but he at least knows how we wound up where we are.

Well at least he was driving a Prius

2007-07-05T08:44:00.000-07:00

CNN:Gore's son free on bail, facing drug charges

LOS ANGELES, California (CNN) -- Former Vice President Al Gore's son is getting treatment following his arrest on suspicion of drug possession on Wednesday in Los Angeles, according to a Gore spokesman.

Marijuana and prescription drugs were found in the car Al Gore III was driving, police said.

Al Gore III, 24, was arrested in Los Angeles early Wednesday after he was stopped for speeding, according to a sheriff's department spokesman.

......According to Amormino, Gore was driving south about 2:15 a.m. in his Toyota Prius, going 100 mph on the San Diego Freeway, when authorities stopped him.

Just the juxtaposition of a Prius and 100MPH amused me. Perhaps that's symptomatic of the suburban "soft environmentalist" movement, using hybrids and other "green" technologies to do rather "ungreen" things. "Wow, with my new hybrid Lexus I can do my 80 mile commute without paying near so much for gas", etc.

Now, THAT'S a "MaxxForce" engine!

2007-06-25T05:50:00.000-07:00

BigLorryBlog:It's what Biglorryblog has been saying all along--MAN's vee-eight BIG banger has got the power 680hp of it!

It's big it's throbby..it's been predicted by Biglorryblog for ages and now it's finally here. Or it will be in time for the RAI Show. Yes the long-awaited V8 'Big banger' from MAN (which is also used by the crane maker Liebherr) has finally broke cover with 680hp and 3,000 throbby newton meters of torque on tap. Thus the MAN V8 'leapfrogs' the Volvo FH16 660 by a 'massive' err...20hp...to become 'the most powerful series truck in Europe'.

Now, International has a worthy big brother to those 11 and 13 liter motors they're buying from MAN. Be a nice way to displace some of those CATs from under the hood of the 9900i's they flog as a premium truck (premium in our context means the basic design hasn't changed in 20 years). I only wonder if they have the guts to do it. By the way those MAN cabovers sure would make a nice 9800 series.

High Fuel Prices Pinching Schools

2007-06-24T07:13:00.000-07:00

Bartlesville, OK Examiner-Enterprise: Rising Fuel Costs Affect School Districts

Rising fuel costs in recent years have affected local school districts as hopes for increased funding — to pay for these rising costs — are met with meager operational funding increases for this next school year.

Local school administrators compare the amounts their districts spent on fuel in 2003 to the amounts spent today.

In 2003, the Bartlesville Public Schools district paid $55,745 for diesel and $15,306 for gasoline. So far this year, the district had spent a total of $158,266 on fuel — $106,980 for diesel and $51,286 for gasoline.

The increase is probably enough to pay for a teacher's salary and benefits. That's a big chunk to lose from a small school district's budget. The hard thing is there isn't that much that realistically can be done with the vehicles to boost fuel economy. The low number of miles a small city bus will run makes the per mile cost of hybridization impractical. Given School Bus safety standards weight cutting opportunities are very limited. I could see using automated manual transmissions or well trained drivers and manual transmissions in place of the normal Allison automatic but there are problems there as well (unfamiliar tech and a shrinking pool of people willing to use a manual). School busses are usually specced with a pretty small motor so there isn't much to cut there.

There isn't much in the way of alt-fuels tech that's ready to roll. Tulsa used to use Compressed Natural Gas for their busses but given high and volatile Natural Gas prices in the last few years that's not a winner. I suppose an ethanol fueled gasser might almost make sense for low mileage runs in states that subsidize E85. It wouldn't do better from an MPG stance but you'd probably save $10K in initial costs, come out about even on maintenance, and be buying a bit cheaper fuel (of course that depends on the state continuing to subsidize it).

There are other tweaks around driver behavior (no idling, doing pretrips, progressive shifting, and planning ahead) but those are probably marginal changes (less than 5%).

The real meat of the issue is going to come to either raising taxes (for districts that control their own funding),cutting funds from somewhere else in the budget, or reducing service.

The China Effect

2007-06-24T05:48:00.000-07:00

Jeffrey Saut: Curves

As for China, we have long-stated that China will continue to favor the U.S. until they no longer need us. To wit, China is importing technology from us that would have taken them years to develop on their own. China also has a vested interest in keeping the U.S. consumer alive and spending. Still, our sense is that once China has sucked this country dry of its proprietary technologies, the recycling of its tradable-goods dollars will wane.

at least American businesses are not alone:
World Trucks Blog: Volvo CNHTC Deal Set to Dissolve

Trebles all round in Gothenburg we assume. The Volvo-CNHTC JV has been a dog. In fact, it’s been rather embarrassing to watch the Swedish leg get lifted higher and higher. As one-way deals go, it’s been textbook. Last year, a magnificent 200 vehicles were moved, and we assume that CNHTC has higher hopes for its own Howo product – which bears a striking resemblance to Volvo’s own vehicles. Farcical.

So Volvo stands to lose up to SEK 500 / £36.6 / €55.32 / $72.04 million on the deal. We say it’s lucky to get out with a pair of shoes still on its feet – this was an ill-conceived, badly executed nonsense, and the shareholders should be celebrating on the one hand, whilst beating AB Volvo's management into a bloody pulp with the other. Should make for a good session tomorrow (Friday) when AB Volvo reports its 2006 numbers.

Now we wait to see what lessons have been learned as the DongFeng deal gets inked. Let us observe - and merely as an aside - that when supping with the Devil, the use of a long spoon is appropriate.

So our industries are busy sowing the seeds of their own destruction. Of course given how the corporate chieftain class thinks one quarter ahead at most that's not surprising.

Why Democrats will falter after 2008

2007-06-17T13:38:00.000-07:00

Adbusters: The American Left's Silly Victim Complex

David Sirota, author of Hostile Takeover: How Big Money and Corruption Conquered Our Government – and How We Can Take it Back, is a guy who frequently appears on television news programs defending the “left” in TV’s typical Crossfire-style left-right rock-‘em-sock-‘em format. Like a lot of people who make their living in this world, he’s sometimes frustrated with the lack of discipline and purpose in American liberalism. And like Sanders, he worries that there is a wide chasm between the people who speak for the left and sponsor left-leaning political organizations, and the actual people they supposedly represent.

“Perhaps what the real issue is that the left is not really a grassroots movement,” he says. “You have this donor/elite class, and then you have the public . . . You have these zillionaires who are supposedly funding the progressive movement. At some point that gets to be a problem.”

Sanders agrees, saying that “where the money comes from” is definitely one of the reasons that the so-called liberals in Washington – i.e. the Democrats – tend not to get too heavily into financial issues that affect ordinary people. This basically regressive electoral formula has been a staple of the Democratic Party ever since the Walter Mondale fiasco in the mid-eighties prompted a few shrewd Washington insiders to create the notorious “pro-business” political formula of the Democratic Leadership Council, which sought to end the party’s dependence upon labor money by announcing a new willingness to sell out on financial issues in exchange for support from Wall Street. Once the DLC’s financial strategy helped get Bill Clinton elected, no one in Washington ever again bothered to question the wisdom of the political compromises it required.

Within a decade, the process was automatic – Citibank gives money to Tom Daschle, Tom Daschle crafts the hideous Bankruptcy Bill, and suddenly the Midwestern union member who was laid off in the wake of Democrat-passed NAFTA can’t even declare bankruptcy to get out from the credit card debt he incurred in his unemployment. He will now probably suck eggs for the rest of his life, paying off credit card debt year after year at a snail’s pace while working as a non-union butcher in a Wal-Mart in Butte. Royally screwed twice by the Democratic Party he voted for, he will almost certainly decide to vote Republican the first time he opens up the door to find four pimply college students wearing I READ BANNED BOOKS t-shirts taking up a collection to agitate for dolphin-safe tuna.

But money and campaign contributions aren’t the only reason “liberal“ politicians screw their voters.

“It’s also a cultural thing,” Sanders says. “A lot of these folks really don’t have a lot of contact with working-class people. They’re not comfortable with working-class people. They’re more comfortable with environmentalists, with well-educated people. And it’s their issues that matter to them.”

The problem the Democrats have is they do not have an agenda that reaches beyond their base beyond ending the war.

Healthcare reform will be constrained by the Industry donors. What can be accomplished without turning off the money spigot is unlikely to be something to build a new deal size coalition out of.

Environmental issues are popular until the cost of a lot of these issues are made public. For the Berkeley crowd, killing the domestic auto industry as collateral damage is really not a bad thing at all. That fact will not be lost on UAW members and other victims of the Greening of America,

Gay Marriage is fading as an issue. Once you pass it, there really isn't too much left to do.

Abortion, also known as the issue that dare not speak its name, is a tar baby pols on both sides dance around.

Democrats could do a lot of good, they have to build a broader coalition. That means engaging with the real issues working Americans are facing, not just "feeling their pain." Then there is the issue of corporate cash and the corrosive effect on the Democratic soul. One pro-oligarch party is enough, thank you very much.

The biggest mistake in Iraq

2007-06-17T08:19:00.000-07:00

Firedoglake:Losing Never Cost So Much

The US military, in short, sucks at insurgency, occupation and colonial style warfare. It is brilliant at battlefield operations outside of major urban centers and is probably, as a whole, the premier battlefield supremacy army in the world today. The Gulf War showed that very clearly. And, indeed, if the US military had blown into Baghdad, toppled the regime and left in 6 months, everyone would still be trembling in fear.
What the US has, then, is a decapitation military. It’s very good at knocking off governments, but not so good at guaranteeing what happens afterwards.

The biggest political mistake the administration made in Iraq was trying to run it. Americans do not have the Patience for long wars that do not involve an existential threat. John Mueller points out that

American troops have been sent into harm's way many times since 1945, but in only three cases -- Korea, Vietnam, and Iraq -- have they been drawn into sustained ground combat and suffered more than 300 deaths in action. American public opinion became a key factor in all three wars, and in each one there has been a simple association: as casualties mount, support decreases. Broad enthusiasm at the outset invariably erodes.

If we had taken down the regime, did our WMD search, tossed the keys to Chalibi, and bailed the political and (more importantly) geopolitical consequences would have been much smaller. Iraq still would have gone to hell after the fact (and Chalibi probably wouldn't have lived real long) but it would be an embarrassment, not a catastrophe, and our military would still look omnipotent. Now Iran is cheerfully building nukes while inflicting the death of a thousand cuts on the US military. The Norks are playing nuclear rope-a-dope again. Our soaring debt has set us up for another round of economic pain, ala the stagflation 70s. Meanwhile the army will need several years of retooling to get "unbroken".

I like Ike

2007-06-17T03:11:00.000-07:00

Christian Science Monitor op-ed: How Eisenhower solved illegal border crossings from Mexico

George W. Bush isn't the first Republican president to face a full-blown immigration crisis on the US-Mexican border.

Fifty-three years ago, when newly elected Dwight Eisenhower moved into the White House, America's southern frontier was as porous as a spaghetti sieve. As many as 3 million illegal migrants had walked and waded northward over a period of several years for jobs in California, Arizona, Texas, and points beyond.

President Eisenhower cut off this illegal traffic. He did it quickly and decisively with only 1,075 United States Border Patrol agents - less than one-tenth of today's force. The operation is still highly praised among veterans of the Border Patrol.

.......America "was faced with a breakdown in law enforcement on a very large scale," Mr. Brownell said. "When I say large scale, I mean hundreds of thousands were coming in from Mexico [every year] without restraint."

Although an on-and-off guest-worker program for Mexicans was operating at the time, farmers and ranchers in the Southwest had become dependent on an additional low-cost, docile, illegal labor force of up to 3 million, mostly Mexican, laborers.

........In 1954, Ike appointed retired Gen. Joseph "Jumpin' Joe" Swing, a former West Point classmate and veteran of the 101st Airborne, as the new INS commissioner.

Influential politicians, including Sen. Lyndon B. Johnson (D) of Texas and Sen. Pat McCarran (D) of Nevada, favored open borders, and were dead set against strong border enforcement, Brownell said. But General Swing's close connections to the president shielded him - and the Border Patrol - from meddling by powerful political and corporate interests.

One of Swing's first decisive acts was to transfer certain entrenched immigration officials out of the border area to other regions of the country where their political connections with people such as Senator Johnson would have no effect.

Then on June 17, 1954, what was called "Operation Wetback" began. Because political resistance was lower in California and Arizona, the roundup of aliens began there. Some 750 agents swept northward through agricultural areas with a goal of 1,000 apprehensions a day. By the end of July, over 50,000 aliens were caught in the two states. Another 488,000, fearing arrest, had fled the country.

By mid-July, the crackdown extended northward into Utah, Nevada, and Idaho, and eastward to Texas.

By September, 80,000 had been taken into custody in Texas, and an estimated 500,000 to 700,000 illegals had left the Lone Star State voluntarily.

Unlike today, Mexicans caught in the roundup were not simply released at the border, where they could easily reenter the US. To discourage their return, Swing arranged for buses and trains to take many aliens deep within Mexico before being set free.

Tens of thousands more were put aboard two hired ships, the Emancipation and the Mercurio. The ships ferried the aliens from Port Isabel, Texas, to Vera Cruz, Mexico, more than 500 miles south.

The sea voyage was "a rough trip, and they did not like it," says Don Coppock, who worked his way up from Border Patrolman in 1941 to eventually head the Border Patrol from 1960 to 1973.

Mr. Coppock says he "cannot understand why [President] Bush let [today's] problem get away from him as it has. I guess it was his compassionate conservatism, and trying to please [Mexican President] Vincente Fox."

There are now said to be 12 million to 20 million illegal aliens in the US. Of the Mexicans who live here, an estimated 85 percent are here illegally.

......General Swing's fast-moving campaign soon secured America's borders - an accomplishment no other president has since equaled. Illegal migration had dropped 95 percent by the late 1950s.

Several retired Border Patrol agents who took part in the 1950s effort, including Mr. Edwards, say much of what Swing did could be repeated today.

"Some say we cannot send 12 million illegals now in the United States back where they came from. Of course we can!" Edwards says.

Why I am I not surprised that with 10 times the resources Bush is thwarted by a problem only 4 times the size that Ike faced? Of course it is not just a matter of competence, but of will. Ike had an unfair advantage though, he wasn't a politician (ever notice how we're developing our own "royal" families) and he wasn't in bed with (or one of) the CEOs. Bush is trying to provide political cover for the immigration bill by "cracking down" on illegal immigration. We've got decades of evidence about how the Plutocrats in our ingrown Political caste will act when the heat is off though. Is it any wonder that we don't trust the D.C. crowd when they claim to be serious about border security?

The Web just got TiVO'd

2007-06-11T11:20:00.000-07:00

Watched coverage of Apple's WWDC event. One of the new features of Leopard will be the ability to "cut out" part of a web page and have an auto updating "widget" on the desktop. So I could go to CNN's website, pick my favorite section and snip it and have that part of the page auto updating on my desktop. Most likely the user won't be including any of the ads in the "snipped" section. In a way this is the ultimate end of the ad blockers, user doing like they do with their TiVOs choosing the content they want and excising ads and filler(ie all the content they don't want).

I've seen plenty of complaints about Rupert Murdoch bidding for Dow Jones, but the business case for ad sponsored content is going away. Eventually most media might revert to sponsors much like the medieval artists, wealthy people with outsized egos who will own newspapers as trophy assets and employ journalists to paint a picture of the World as they see it.

Interesting

2007-06-10T14:59:00.000-07:00

RedState: Sunday Morning Talk Shows

Former Secretary of State Colin Powell was host Tim Russert's guest on MTP [Meet The Press].... Powell said that he would close Gitmo "this afternoon" and put its inmates into our general prison population. He said that it was "too early" to say if he would support the Republican Presidential nominee but that he was advising Barack Obama on foreign policy matters. He would not rule out returning to public service at some future date.

I wonder if Powell regrets not getting on the Democratic ticket back in 2000? His legacy, and the world might have both been the better for it (assuming Gore would listen to him). Now he is one of many who lent their credibility to the Bush drive to war and were left wishing they'd asked for a deposit.

Is it Cynicism or Realism?

2007-06-10T05:22:00.000-07:00

Andrew Bacevich:I lost my son to a conflict I oppose. We were both doing our duty

To whom do Kennedy, Kerry and Lynch listen? We know the answer: to the same people who have the ear of George W. Bush and Karl Rove - namely, wealthy individuals and institutions.
Money buys access and influence. Money greases the process that will yield us a new president in 2008. When it comes to Iraq, money ensures that the concerns of big business, big oil, bellicose evangelicals and Middle East allies gain a hearing. By comparison, the lives of U.S. soldiers figure as an afterthought.
Memorial Day orators will say that a G.I.'s life is priceless. Don't believe it. I know what value the U.S. government assigns to a soldier's life: I've been handed the check. It's roughly what the Yankees will pay Roger Clemens per inning once he starts pitching next month.
Money maintains the Republican/Democratic duopoly of trivialized politics. It confines the debate over U.S. policy to well-hewn channels. It preserves intact the cliches of 1933-45 about isolationism, appeasement and the nation's call to "global leadership." It inhibits any serious accounting of exactly how much our misadventure in Iraq is costing. It ignores completely the question of who actually pays. It negates democracy, rendering free speech into little more than a means of recording dissent.
This is not some great conspiracy. It's the way our system works.

Sadly, I think this is the reality. The bitter irony is that in a system premised on "all men are created equal" some are "more equal than others" (to borrow from a critique of another failed system).

I'm a member of the authoritarian left: Who Knew?

2007-06-08T15:28:00.000-07:00

Your political compass
Economic Left/Right: -6.00
Social Libertarian/Authoritarian: 2.26
Political Compass

Deindustrailization has Consequences

2007-06-03T22:42:00.000-07:00

Defense Industry Daily: 17,000 MRAP Vehicles to Replace Hummers?

After 4 years of combat in an arena that featured IED land mines as the #1 threat, the US military's success in fielding limited numbers of blast-resistant Cougar and Buffalo vehicles finally drew the attention of senior military officials, and the civilian politicians to whom they report. The military's order of MRAP (Mine-Resistant, Ambush Protected) vehicles went from 1,000 vehicles in 2006, to 4,100 later that year, and soon thereafter to 7,774 vehicles. Within that expanded order, however, only 2,500 were for the Army; 3,700 were for the US Marines, who vowed to make every patrol vehicle operating "outside the wire" in Iraq's Anbar province an MRAP vehicle.

.....The House Armed Services Seapower and Expeditionary Forces Subcommittee under Chairman Gene Taylor [D-MS] and Ranking Member Roscoe Bartlett [R-MD] recently proposed, in coordination with Chairman Abercrombie [D-HI] of the Air and Land Subcommittee, proposed $4.1 billion for MRAP vehicles for full House Armed Services committee consideration, re: the FY 2008 "request for ongoing military operations" (supplemental).

Even this request, however, was in the context of fulfilling the $8.4 billion order for 7,774 vehicles within the goal of a 2-year time frame. Now the Army is looking to add from 15,000-17,000 vehicles for production from FY 2008 - FY 2010.

Which raises the question of how the manufacturers, whose production lines are currently built for 100 vehicles or so per month, will manage. At present, 400 vehicles per month appears to be the most any MRAP manufacturer has promised to produce, and that's assuming production growth over the course of the contract. A total of 23,000-25,000 vehicles in 2 1/2 years is likely to prove something of a challenge, therefore, even with several vendors participating. Even, one might add, with BAE Systems $4.53 billion purchase of production at Armor Holdings.

America used to be known as "The Arsenal of Democracy", now 4 years in we don't have production capacity to get the tool our troops need into the field. The change is partially due to a lack of mobilization (which is part and parcel of the low commitment war), but also stems from the limited industrial capacity available in the specialty heavy truck manufacturing industry.

Given our ever declining manufacturing capacity and our dependence on the Middle East for oil (we were an oil exporter in WW2) it seems like an open question if we could manage another war effort like World War 2.

God forbid, but if we wound up in a confrontation with China we would need many more supplies than it would ever make sense to have in the warehouses. Even in Iraq, supplies are being depleted faster than they can be replenished. It will take years to rebuild the armed services' inventories of helicopters, trucks, tanks, and equipment great and small. We have been steadily exporting steel mills and factories and even in full mobilization it would take years to rebuild that infrastructure.

Not to mention that the willingness of some Middle Eastern Nations to sell us oil in a conflict might be suspect. Also Iran is strategically located to disrupt oil traffic through the Straits of Hormuz. Having spent substantial effort on learning how to make bunkers that are resistant to air attack (which Israel was kind enough to test for them), removing the garrote from the Gulf could well take a substantial amount of time and effort(the Iranians learned from the Tanker War, and not entirely the lessons we would have wished for them to learn). Then we have to get it from point A to Point B. China is unlikely to be able to launch a substantial Blue Water Naval presence in the near term, but are working to add to their abilities in that area. Even a handful of subs could be a pretty significant annoyance, tying up resources hunting them and escorting maritime transport.

Tying into both of these is our crumbling infrastructure. The Backlog of deferred maintenance on the roads, rails, and canals that vital goods will be traveling on would be another expensive distraction. Also we burn more fuel than we need to moving goods and people around the country. If we need to conserve fuel, rail and water transport win hands down. Rail has been steadily shedding capacity seeking to reduce cost and shift the supply/demand balance in their favor. Locks are aging, and waterways generally only draw attention when the spill over their banks. When these are offline being patched or running below capacity we are going to have to run multitudes of trucks increasing our oil and infrastructure costs.

Oddly enough, all of the "make work" projects during the depression may have improved our readiness for the second World War by reducing the number of urgent infrastructure needs when the war started.

When Puppies Go Bad

2007-05-29T13:17:00.000-07:00

Detroit News: Puppies are latest commodity for Internet scams

And now for the latest scam from Nigeria -- puppies.
The Council of Better Business Bureaus and American Kennel Club today will issue a warning about fraudulent Web sites, MySpace postings and print ads asking people to help save puppies who are in desperate straits.
The sites and ads usually show adorable bulldog puppies that have become stuck somehow in Nigeria or other countries and are offered free to new owners. A variation is to offer the purebred, English bulldogs -- a particularly expensive breed -- at vastly discounted prices.
People who responded to the ads eventually were asked to send hundreds of dollars to cover expenses such as shipping, customs, taxes and inoculations on an ever escalating scale.
Some reported paying fees totaling more $1,500.
"It's like the Nigerian advance fee scams we've been seeing for years, except with the face of a puppy," said Steve Cox, a council vice president.
No matter how much was paid, no puppies arrived.

We've built up our defenses. We know better than to believe all those ads for Viagra...Cheap! We turn our nose up at red hot stock tips, Real Live Girls (thank God they're not Real Dead Girls), and even at flush Nigerian Princes in dire Straits. Now we have to face down adorable little puppy faces in our inbox! How will we do it?

Seriously, though, you have to wonder about anyone who would send money to one of these scams.

Sicko indeed

2007-05-29T10:41:00.000-07:00

NYT:‘Sicko,’ Castro and the ‘120 Years Club’

“Sicko,” the talk of the Cannes Film Festival last week, savages the American health care system — and along the way extols Cuba’s system as the neatest thing since the white linen guayabera.

Mr. Moore transports a handful of sick Americans to Cuba for treatment in the course of the film, which is scheduled to open in the United States next month, and he is apparently dumbfounded that they could get there what they couldn’t get here.

....Universal health care has long given the Cuban regime bragging rights, though there is growing concern about the future. In the decades that Cuba drew financial and military support from the Soviet Union, Mr. Castro poured resources into medical education, creating the largest medical school in Latin America and turning out thousands of doctors to practice around the world.

But that changed after the collapse of the Soviets, according to Cuban defectors like Dr. Leonel Cordova. By the time Dr. Cordova started practicing in 1992, equipment and drugs were already becoming scarce. He said he was assigned to a four-block neighborhood in Havana Province where he was supposed to care for about 600 people.

“But even if I diagnosed something simple like bronchitis,” he said, “I couldn’t write a prescription for antibiotics, because there were none.”

He defected in 2000 while on a medical mission in Zimbabwe and made his way to the United States. He is now an urgent-care physician at Baptist Hospital in Miami.

Having practiced medicine in both Cuba and the United States, Dr. Cordova has an unusual perspective for comparison.

“Actually there are three systems,” Dr. Cordova said, because Cuba has two: one is for party officials and foreigners like those Mr. Moore brought to Havana. “It is as good as this one here, with all the resources, the best doctors, the best medicines, and nobody pays a cent,” he said.

But for the 11 million ordinary Cubans, hospitals are often ill equipped and patients “have to bring their own food, soap, sheets — they have to bring everything.” And up to 20,000 Cuban doctors may be working in Venezuela, creating a shortage in Cuba.

So Mr. Moore passed off as fact a government dog and pony show about how wonderful life is in the Workers' Paradise. Too bad the reality for the workers in Cuba isn't quite so pretty.