I guess if you're in your second term, you don't want to try something new. Why hire someone who might know something about the territory? It looks like Bush has nominated another less than sterling candidate to help run our government. He has nominated Ellen Sauerbrey to be Assistant Secretary of State for Population, Refugees and Migration. While she has been a state legislator, a candidate for Maryland Governor and has recently served at the UN, she appears to have zero experience in re-settling refugees or international crisis management.
She's being lambasted for being anti-abortion, but that shouldn't be the primary reason why she should not be named to the front-line position of managing refugee affairs. The straightforward, unemotional reasons why she should not be appointed are summarized by the head of Refugees International.
Monday, October 31, 2005
There's a first time for everything
Yesterday at the opera, for the first time, I saw a line snaking out the Men's Room door. Maybe, things are becoming more equal.
Saturday, October 29, 2005
More indictments at Refco?
Santo Maggio, who was put on leave with Bennett, has now started talking with the prosecutors. He was with Refco for twenty years in very high positions and likely knows what really happened there. I suspect that we'll be seeing more indictments.
A few small steps for the better at Guantanamo
The Pentagon has finally agreed to let some UN monitors into the Guantanamo complex. They'll be able to look around at many things but will not be allowed to talk to the detainees. Of course, we "have nothing to hide."
A judge has ruled that lawyers for those on a hunger strike must be told prior to force feeding and must receive medical reports weekly.
A judge has ruled that lawyers for those on a hunger strike must be told prior to force feeding and must receive medical reports weekly.
Friday, October 28, 2005
The Volcker Report
In general, I'm opposed to economic sanctions on the grounds that the people, rather than the rulers, of the country are the ones injured. Now, with the report by the Independent Inquiry Committee led by Paul Volcker we see that not only are the rulers not injured, but they can also make a good dollar from a sanctions program, such as the Iraq Oil for Food program.
While it took a while for Saddam and his boys to catch on, they were able to earn at least $1.8 billion in a couple of years. The money came from two sources: those who bought oil from Iraq (139 companies paid $229 milion to Saddam) and those who supplied food and other necessities (2,253 companies paid $1.55 billion to Saddam). Note that just about two-thirds of those companies supplying Iraq paid bribes. That's a pretty high rate of ethically-challenged people. I say 'people' because the report emphasizes that a particular company may really not have known what their employer or agent was doing and may not have benefited from the crime.
Companies, organizations and individuals named in the report include: Volvo, Siemens, Daewoo, Daimler Chrysler, Weir, AWB, Orthodox Church of Russia, Palestine Liberation Front, BNP, France's Interior Minister. Oscar Wyatt, a noted American oilman, was indicted last week on charges of making illegal payments to Saddam.
The design of the program was flawed in that Iraq was allowed to choose both the buyers of its oil and those who sold Iraq the food. Thus, Iraq had leverage in both sides of the transaction. It used that leverage to try to influence nations, such as Russia and France, that were reasonably friendly toward it and also to make money for Saddam. Further, the escrow bank, BNP, was allowed to issue letters of credit that financed purchases of oil. Finally, there are questions as to the effectiveness of the companies hired to monitor the program.
All in all not very pleasant reading.
While it took a while for Saddam and his boys to catch on, they were able to earn at least $1.8 billion in a couple of years. The money came from two sources: those who bought oil from Iraq (139 companies paid $229 milion to Saddam) and those who supplied food and other necessities (2,253 companies paid $1.55 billion to Saddam). Note that just about two-thirds of those companies supplying Iraq paid bribes. That's a pretty high rate of ethically-challenged people. I say 'people' because the report emphasizes that a particular company may really not have known what their employer or agent was doing and may not have benefited from the crime.
Companies, organizations and individuals named in the report include: Volvo, Siemens, Daewoo, Daimler Chrysler, Weir, AWB, Orthodox Church of Russia, Palestine Liberation Front, BNP, France's Interior Minister. Oscar Wyatt, a noted American oilman, was indicted last week on charges of making illegal payments to Saddam.
The design of the program was flawed in that Iraq was allowed to choose both the buyers of its oil and those who sold Iraq the food. Thus, Iraq had leverage in both sides of the transaction. It used that leverage to try to influence nations, such as Russia and France, that were reasonably friendly toward it and also to make money for Saddam. Further, the escrow bank, BNP, was allowed to issue letters of credit that financed purchases of oil. Finally, there are questions as to the effectiveness of the companies hired to monitor the program.
All in all not very pleasant reading.
China and Education
As those who read these scribblings regularly know, the subjects of the rise of China and the decline of education in America receive a fair amount of my time. Today's NY Times discusses China's push in graduate level education in science and technology. You know: something similar to the push here after Sputnik.
China is recruiting professors from around the world to staff their universities and research labs. And they're able to convince people from places like Princeton, Yale and MIT to come to China to help it become known as having the leading universities in the world over the next ten to twenty years.
The education push has been going on for almost thirty years and has succeeded in increasing the percent of its college-age population who actually are in college from 1.4% in 1978 to 20% now. Many of these students are in engineering: 442,000 undergraduates, 48,000 with masters, 8,000 with doctorates.
While China by no means practices the same type of academic freedom that we have here - and that freedom is really necessary if they are to succeed on a grand scale beyond mere numbers -, I suspect that they will gradually loosen up over time. Whether they move fast enough to keep the people they've recruited is the question.
China is recruiting professors from around the world to staff their universities and research labs. And they're able to convince people from places like Princeton, Yale and MIT to come to China to help it become known as having the leading universities in the world over the next ten to twenty years.
The education push has been going on for almost thirty years and has succeeded in increasing the percent of its college-age population who actually are in college from 1.4% in 1978 to 20% now. Many of these students are in engineering: 442,000 undergraduates, 48,000 with masters, 8,000 with doctorates.
While China by no means practices the same type of academic freedom that we have here - and that freedom is really necessary if they are to succeed on a grand scale beyond mere numbers -, I suspect that they will gradually loosen up over time. Whether they move fast enough to keep the people they've recruited is the question.
Thursday, October 27, 2005
I suppose it should be expected
If Refco had difficulty closing their books most months, why should one expect them to know how much they owe various firms? On October 17, Refco listed VR Global Partners as being owed $380.1 million. Yesterday, they said it was $620 million. A minor correction. A similar change occured with Bawag P.S.K.: $451.1 million on the 17th, $234 million yesterday. And so it goes.
PETA Must Love Rome
The Rome city council has adopted an animal 'bill of rights'. Walk your dog regularly. Don't put fish in a round bowl. Don't cut cat's nails. And more.
Surprise, Surprise
The NY Times is reporting that Miers has withdrawn. Frankly, I really am surprised. I guess Bush doesn't think he controls the Senate anymore. Will the next nominee be more conservative than Miers? Probably.
Wednesday, October 26, 2005
Another case of reality or fantasy?
Some economists have begun to question the validity of the statistics coming out of China. Maybe, China's numbers can be questioned, but the reality of their growing importance and power in the world cannot.
An Asian View of China
In a recent issue, Foreign Affairs published a series of essays about
A Chinese Perspective
While the essays by the mainland Chinese writers, one an academic, the other a leader of a think tank, have to be read with a degree of skepticism, there are some interesting ideas there.
First is the recognition that China’s rise to power has been peaceful; unlike Germany and Japan, for example, they have not gone to war to make the gains they have in the past thirty years. They realize that, while the gains have been considerable, they still have a long way to go. They rate the country as a “low-income developing” one, whose economy is ranked at about 100th in the world; they don’t expect to become a “modernized, medium-level developed country” until 2050.
In the long run, they view as inevitable the arrival of a multi-lateral world where the
And, they see our international problems as well: the
In terms of specific US-China issues, three countries are mentioned:
An Asian Perspective
The writers here are from
The
From the perspective of at least one Singaporean intellectual, “the
Our leaders seem to be unaware of the degree of change that has occurred in
These essays were, I thought, thoughtful and worthy of being read by those of us who believe that we must start developing a strategy for a multi-power world.
Tuesday, October 25, 2005
Immunity for the CIA?
Earlier this month the Senate voted to ban the use of "cruel, inhuman or degrading treatment" of any detainee we hold. Now, Cheney and Goss want to exclude the CIA from this ban. Their reasoning is that such a ban on the CIA would hinder the global war on terror. What effect does excusing the CIA have on our national conscience?
Fact or Fiction?
As you'd assume from its title, Foreign Policy magazine does not normally publish fiction. And they haven't started to do so. But, an article, "The Mayor of Ar Rutbah", in the current issue certainly sounds fictional when one considers what is going on in Iraq today.
The teaser for the article is "How One Soldier Brought Democracy to Iraq". The "soldier" is the author of the article, Major James A. Gavrilis, who has spent his Army career as a Special Forces officer. Although he had no training or guidance in rebuilding a country, he performed admirably. In two weeks he did, in fact, bring a better life to the people of Ar Rutbah. The problem is that it was only two weeks and the two weeks were April 9 - 23, 2003, before the results of little post-war planning started to show and before Garner and Bremer began solving problems.
Some of the steps Gavrilis took were rather basic and flowed from his belief that "We treated them not as a defeated people, but as allies. Our success became their success." He acted quickly; by the end of the first day in the city he had established an administration led by Iraqis who lived in the city (of course, Gavrilis retained veto rights). Security was his top priority, as it should have been; he banned all weapons, established checkpoints, took advantage of the local police officers' knowledge of the people in town. Next was restoring things to normal: electricity, water, fuel and the daily market. Communication was vital; the mosques became the main vehicle of communication. Most importantly, Gavrilis was convinced that "good governance had to precede the form or type of democracy."
It's a very uplifting article. I'd like to think that it is factual overall. Had we operated similarly throughout Iraq, it would be quite a different world today.
The teaser for the article is "How One Soldier Brought Democracy to Iraq". The "soldier" is the author of the article, Major James A. Gavrilis, who has spent his Army career as a Special Forces officer. Although he had no training or guidance in rebuilding a country, he performed admirably. In two weeks he did, in fact, bring a better life to the people of Ar Rutbah. The problem is that it was only two weeks and the two weeks were April 9 - 23, 2003, before the results of little post-war planning started to show and before Garner and Bremer began solving problems.
Some of the steps Gavrilis took were rather basic and flowed from his belief that "We treated them not as a defeated people, but as allies. Our success became their success." He acted quickly; by the end of the first day in the city he had established an administration led by Iraqis who lived in the city (of course, Gavrilis retained veto rights). Security was his top priority, as it should have been; he banned all weapons, established checkpoints, took advantage of the local police officers' knowledge of the people in town. Next was restoring things to normal: electricity, water, fuel and the daily market. Communication was vital; the mosques became the main vehicle of communication. Most importantly, Gavrilis was convinced that "good governance had to precede the form or type of democracy."
It's a very uplifting article. I'd like to think that it is factual overall. Had we operated similarly throughout Iraq, it would be quite a different world today.
The Refco saga continues
JC Flowers has pulled out of the deal. Apparently, they received preferential treatment (a break-up fee of up to $21.5 million and reimbursed expenses up to $7 million) which the bankruptcy judge would not allow. Flowers reduced its offer, but it was still not acceptable to the judge.
It looks as though Flowers was favored by the Refco board to such a degree that other potential bidders were not allowed access to the documents and information that should have been available to enable them to evaluate making a potentially higher bid. In fact, a higher bid ($60 million more than Flowers') has been made and others are being considered.
It looks as though Flowers was favored by the Refco board to such a degree that other potential bidders were not allowed access to the documents and information that should have been available to enable them to evaluate making a potentially higher bid. In fact, a higher bid ($60 million more than Flowers') has been made and others are being considered.
Monday, October 24, 2005
How far do you go?
There is a fine line between trying to get information that may help defend us from attack and violating our rights as American citizens. It appears as though the FBI has stepped over that line once more.
From a Freedom of Information Act lawsuit - note, not just a request; a court action was needed to get the information - filed by the Electronic Privacy Information Center we learn that the FBI has spied on US residents - true, not necessarily citizens - for as long as eighteen months without getting the necessary approval from the Justice Department. They also obtained e-mails after the warrant for them had expired and took bank records without proper authority. The FBI attributes the illegal actions to administrative error.
From a Freedom of Information Act lawsuit - note, not just a request; a court action was needed to get the information - filed by the Electronic Privacy Information Center we learn that the FBI has spied on US residents - true, not necessarily citizens - for as long as eighteen months without getting the necessary approval from the Justice Department. They also obtained e-mails after the warrant for them had expired and took bank records without proper authority. The FBI attributes the illegal actions to administrative error.
Sunday, October 23, 2005
Morgan Stanley Again
Arthur Riel, who was in charge of archiving e-mails at Morgan Stanley, was let go by the company earlier this month. Probably in retaliation, he has filed an affidavit with the court that heard the Perelman - Morgan Stanley case. Morgan Stanley wants the affidavit sealed, claiming attorney/client privilege.
The judge overseeing the case has previously questioned the veracity of Mr. Riel's certification that all e-mails had been turned over to the court. Now, Riel's lawyer says he thought he was responsible for reporting only on the existing archive, not on tapes being entered into it.
If the affidavit is accepted by the court it may have a large effect on the criminal contempt application filed by Perelman.
The judge overseeing the case has previously questioned the veracity of Mr. Riel's certification that all e-mails had been turned over to the court. Now, Riel's lawyer says he thought he was responsible for reporting only on the existing archive, not on tapes being entered into it.
If the affidavit is accepted by the court it may have a large effect on the criminal contempt application filed by Perelman.
Two Weeks On
There is a slight bit of clarity emerging re Bennett's assumption of $430 million of Refco debt. It looks as though he took on the debt from people who could not pay what they owed Refco, i.e., bad debts that would be charged to the company. Since it appears as though the practice started in 1998, it looks as though Bennett may have felt that if he could have kept things secret for seven years, he could maintain that secrecy and eventually he would be able to get out from under. And, he was able to conceal things from Thomas Lee and the underwriters.
Saturday, October 22, 2005
Maybe it's not another scandal
Time Magazine reports that the burning of the bodies in Afghanistan occurred after the bodies had been lying in the heat for twenty-four hours and had become a possible health hazard. The Geneva Convention does allow cremation for imperative reasons of hygiene. So, maybe it's not as bad as orginally thought.
Massachusetts runs a clean ship
You've got to be a very upright person to work for the State of Massachusetts, at least you have to avoid pornography. It doesn't really matter too much whether you're good at your job or not, but keep it clean.
That's the message I get from this week's firing by UMass of an assistant vice chancellor. He wasn't fired because they found pornography in his locker, his desk or PC. In fact, they searched his computer and found none. He was fired because it appears that the State Treasurer fired the guy from his previous job because he had porn on his computer.
I know that the state owns the computer and agree that it has the right to expect you to work the hours it is paying you for. But, give it a break! The guy was with the Treasurer's Office twelve years in quite responsible positions. He was being paid six figures by UMass, so it's doubtful he was simply a political hack or an unqualified person.
Will the state now search everyone's computer for what the state considers offensive material?
That's the message I get from this week's firing by UMass of an assistant vice chancellor. He wasn't fired because they found pornography in his locker, his desk or PC. In fact, they searched his computer and found none. He was fired because it appears that the State Treasurer fired the guy from his previous job because he had porn on his computer.
I know that the state owns the computer and agree that it has the right to expect you to work the hours it is paying you for. But, give it a break! The guy was with the Treasurer's Office twelve years in quite responsible positions. He was being paid six figures by UMass, so it's doubtful he was simply a political hack or an unqualified person.
Will the state now search everyone's computer for what the state considers offensive material?
Friday, October 21, 2005
Is a 1/10% failure rate too high?
Another company has joined Boston Scientific in the spotlight for providing faulty equipment. Guidant Corp., #2 maker of heart defibrillators, has acknowledged the existence of 49 reports of short circuits occuring in two models of its defibrillators, of which 42,000 units of both models had been produced.
Okay, it's not a perfect world, accidents happen. But, the issue here is that Guidant knew about the failure for three years and did not deign to tell doctors about the problem apparently because, in Guidant's eyes, the doctors were not capable of deciding whether the risks of removing the device outweighed the risks of keeping it implanted. Furthermore, rather than throwing out the devices it had in inventory, it sold them. That's right, it knew that at least 1/10% of the devices would short circuit and very likely kill someone but still they sold the devices and told no one of the risk. Adding insult to real injury, knowing what they knew about the risks inherent in one device, the Prizm 2 DR, they used the same technology in another device, Contak Renewal.
This is not the first time Guidant has adopted a "we know best' attitude. In 2001 one of the leading cardiologists in the US published an article about electrical failures in some other Guidant devices. The company's response? Silence.
Could it be that Guidant's judgment is being clouded by the $25.4 billion merger agreement that signed with Johnson & Johnson last December? Of course not, as the head of Guidant's cardiac implant unit says, "At this company, the quality culture is absolutely apparent." I'm not sure J&J believes that as they are taking another look at the merger agreement.
Okay, it's not a perfect world, accidents happen. But, the issue here is that Guidant knew about the failure for three years and did not deign to tell doctors about the problem apparently because, in Guidant's eyes, the doctors were not capable of deciding whether the risks of removing the device outweighed the risks of keeping it implanted. Furthermore, rather than throwing out the devices it had in inventory, it sold them. That's right, it knew that at least 1/10% of the devices would short circuit and very likely kill someone but still they sold the devices and told no one of the risk. Adding insult to real injury, knowing what they knew about the risks inherent in one device, the Prizm 2 DR, they used the same technology in another device, Contak Renewal.
This is not the first time Guidant has adopted a "we know best' attitude. In 2001 one of the leading cardiologists in the US published an article about electrical failures in some other Guidant devices. The company's response? Silence.
Could it be that Guidant's judgment is being clouded by the $25.4 billion merger agreement that signed with Johnson & Johnson last December? Of course not, as the head of Guidant's cardiac implant unit says, "At this company, the quality culture is absolutely apparent." I'm not sure J&J believes that as they are taking another look at the merger agreement.
Thursday, October 20, 2005
It's worse than I thought
I've expressed concern several times in these pages about the poor showing of our students in world-wide tests of mathematics and sciences. Well, the results of this year's National Assessment of Educational Progress (NAEP) tests strike me as particularly troubling, but maybe it's because of my age.
When I was in school, any grade below 60 was considered failing. The NAEP test is based on a scale of 500 points. So, if you apply the 60 concept to this 500 scale, any score below 300 would be a failing score. What do you suppose the average score was for fourth graders in our nation's schools? Would you believe 238 for math and 219 for reading? Eighth graders did better but not by much - 279 for math, 262 for reading.
What is going on? The test results showed that only 36% of fourth graders were able to handle "challenging, grade-appropriate material" for math, while only 30% of eighth graders could.
The results of these tests are only very slightly better than the tests of 1990, but our Education Secretary says our education reform efforts are on the right track. When did we move to a position where failing grades are accepted?
When I was in school, any grade below 60 was considered failing. The NAEP test is based on a scale of 500 points. So, if you apply the 60 concept to this 500 scale, any score below 300 would be a failing score. What do you suppose the average score was for fourth graders in our nation's schools? Would you believe 238 for math and 219 for reading? Eighth graders did better but not by much - 279 for math, 262 for reading.
What is going on? The test results showed that only 36% of fourth graders were able to handle "challenging, grade-appropriate material" for math, while only 30% of eighth graders could.
The results of these tests are only very slightly better than the tests of 1990, but our Education Secretary says our education reform efforts are on the right track. When did we move to a position where failing grades are accepted?
What's $33 billion among friends?
I suppose we shouldn't be surprised by the change in Refco's statement to the bankruptcy court re their assets. In their initial filing, the accountants at Refco (the guys who, according to the offering circular could not close the books on time) or Grant Thornton (the auditors who claimed a hedge fund would pay the money that they didn't know Bennett owed) claimed the company had $49 billion in assets. Two days later the number was down to $16.5 billion.
Customer deposits are at $4.1 billion, still a few hundreds of millions above the number at which Flowers can walk away from the deal. Things have been on a very, very fast track and maybe the court will approve the deal by November as Flowers wants.
Customer deposits are at $4.1 billion, still a few hundreds of millions above the number at which Flowers can walk away from the deal. Things have been on a very, very fast track and maybe the court will approve the deal by November as Flowers wants.
Another military criminal investigation
Now, it's burning dead bodies. An Australian tv station showed what looks like our soldiers burning the bodies of two Taliban fighters. Muslims consider cremation a sacrilege. Is this a more extreme case of throwing the Koran down the toilet? I suppose one could say that this is psychological warfare; and maybe it is. But it also probably is a violation of the Geneva Convention, which calls for honorably burying the dead.
The Army says it will investigate aggressively as does the Afghan Defense Ministry.
At the same time, you read an interview with Powell's former chief of staff, Colonel Lawrence Wilkerson, who says with reference to Abu Gharaib, "You don't have this kind of pervasive attitude out there unless you've condoned it."
If the allegation proves true, will any higher-up be tried for it? Past experience says no.
The Army says it will investigate aggressively as does the Afghan Defense Ministry.
At the same time, you read an interview with Powell's former chief of staff, Colonel Lawrence Wilkerson, who says with reference to Abu Gharaib, "You don't have this kind of pervasive attitude out there unless you've condoned it."
If the allegation proves true, will any higher-up be tried for it? Past experience says no.
Wednesday, October 19, 2005
God and Profits
In scanning today's Wall Street Journal I noticed an ad for an ethics/faith-based company seeking investors to whom they can document a 700% ROI. I was surprised to see such an ad in the Journal. Few Journal business opportunity ads claim even 20% returns. This claims a return 35 times that. Maybe you'll go to heaven as well if you invest, since the company is based on ethics and faith.
It's not over till its over
Some details are coming out re Flowers' acquisition of Refco's futures business which could prevent the deal from closing:
- The deal has to be approved by the bankruptcy court. I can't see the court saying no.
- The new owners will not incur liabilities based on the most recent problems. This might be dicey.
- Customer assets can't fall below $3.75 billion when averaged over three days. As of May 31, these assets totaled $4.1 billion but Cargill was acquired since then and many customers have jumped ship over the past week. It's unlikely that assets will fall below the magic number as Flowers & company seem to be calming the markets.
A nice story
Darpa, the Pentagon agency that started the Internet, had its annual computer-controlled car race in the couple of weeks. A team from Stanford won by piloting its car via computer over 132 miles in a little less than seven hours. The real story of the race is the team that finished fourth.
That team was from Gray Insurance. It was competing against teams from elite colleges and top defense contractors. The Gray team really accomplished miracles. First, they only decided to enter the race at the start of this year and didn't get their car until April. The guys who wrote the software were the IT department of the company, presumably regular application programmers. But, they would have to have been very, very good programmers to beat the competition they had. They picked up the specific knowledge needed by reading a lot. They bought as many top quality off-the-shelf components as they could and then wrote some code.
Just finishing this work was impressive enough. Being based in Metairie, LA, and thus battered by Katrina puts this achievement in almost a miracle class. The primary programmers should be noted: Keith Goeller, Paul Trepagnier and Jorge Nagel.
That team was from Gray Insurance. It was competing against teams from elite colleges and top defense contractors. The Gray team really accomplished miracles. First, they only decided to enter the race at the start of this year and didn't get their car until April. The guys who wrote the software were the IT department of the company, presumably regular application programmers. But, they would have to have been very, very good programmers to beat the competition they had. They picked up the specific knowledge needed by reading a lot. They bought as many top quality off-the-shelf components as they could and then wrote some code.
Just finishing this work was impressive enough. Being based in Metairie, LA, and thus battered by Katrina puts this achievement in almost a miracle class. The primary programmers should be noted: Keith Goeller, Paul Trepagnier and Jorge Nagel.
Learning from Vietnam
By now you must have at least heard that Melvin Laird, Nixon’s Secretary of Defense during part of the Vietnam War, has written an article in Foreign Affairs comparing Vietnam and Iraq. He has some harsh words about our conduct in managing both wars, but also feels that we did not lose in Vietnam and, if his advice is followed, we will eventually win in Iraq.
Laird urges a view of history based on facts rather than emotions, but the problem is that my facts may be your fantasy. It’s very hard to know where truth lies especially after the passing of decades. He calls Vietnam “an ugly, mismanaged, tragic episode in US history” from which “there are many valuable lessons to be learned”. It’s hard to disagree with him on this when he was one of the managers.
He blames the media for most Americans' perceptions that the South Vietnamese forces were not very effective. In Laird’s view “from the Tet offensive in 1968 up to the fall of Saigon in 1975, South Vietnam never lost a major battle.” I guess I’m one of the brainwashed as I would think that, if you never lost a major battle in seven years, it’s highly unlikely that you would have been so dependent on US support or that Saigon would have fallen so readily.
Basically, he feels that the major thing that Vietnam should have taught us is that we can support countries we want to save only by giving them money and training but not our troops. In Laird’s words “The war needed to be turned back to the people who cared about it, the Vietnamese.” Fact or fantasy?
His view is that Vietnam was a “success story in nation building”. Is there a nation of South Vietnam somewhere?
He also attributes Vietnam as having played a role in the winning of the Cold War by sucking resources from Russia. I wonder what Reagan would say about that.
“The Vietcong were largely suppressed by a combination of persuasion and force.” Fact or fantasy?
The nub of his advice: define a standard of competence for the Iraqi troops and, when that standard is met, start bringing US troops home in corresponding numbers. One of the problems I have with this advice is Laird is speaking in terms of quantitative standards only. I would think the quality of the troops would have some bearing on this decision. And, I think that Morton Halperin has some strong arguments here as to the degree of commitment - to Iraq as opposed to the insurgency - of some in the Iraqi forces. If Halperin is right, then Laird’s advice may only be a smokescreen for our exiting Iraq.
Laird is a veteran and has been at the heart of American policy making. Who am I to dispute his statement that “wars are fluid things and missions change”? From my comfortable, non-veteran’s chair, I would think this statement true with regard to battles or military campaigns. However, virtually every pre-21st century war that we have fought had, in my judgment a clear, constant mission.
He makes an interesting point about the effect of modern media on people’s attitude toward the war when he asks how much support WWII would have had if we could have seen the D-Day landing in real time. I believe that part of the backlash re Vietnam was the sight of the caskets coming home and the battles being fought on tv. That is clearly why Bush is trying to keep things as hidden from us as possible.
Laird also has some sound advice for Bush and Rumsfeld.
Advice for Bush
Tell America there is an exit strategy.
Level with the American people.
Articulate a simple message and mission, which is we are “fighting to preserve modern culture, Western democracy, the global economy and all else that is threatened by the spread of barbarism in the name of religion.”
Treat the people at Guantanamo more humanely as to continue not to “puts us on a slippery slope toward the inhumanity we deplore”.
Work with our traditional allies.
Advice for Rumsfeld
“show more deference to Congress” or soon they’ll stop funding your efforts in Iraq.
Fire the top people who allowed Abu Gharaib.
Laird urges a view of history based on facts rather than emotions, but the problem is that my facts may be your fantasy. It’s very hard to know where truth lies especially after the passing of decades. He calls Vietnam “an ugly, mismanaged, tragic episode in US history” from which “there are many valuable lessons to be learned”. It’s hard to disagree with him on this when he was one of the managers.
He blames the media for most Americans' perceptions that the South Vietnamese forces were not very effective. In Laird’s view “from the Tet offensive in 1968 up to the fall of Saigon in 1975, South Vietnam never lost a major battle.” I guess I’m one of the brainwashed as I would think that, if you never lost a major battle in seven years, it’s highly unlikely that you would have been so dependent on US support or that Saigon would have fallen so readily.
Basically, he feels that the major thing that Vietnam should have taught us is that we can support countries we want to save only by giving them money and training but not our troops. In Laird’s words “The war needed to be turned back to the people who cared about it, the Vietnamese.” Fact or fantasy?
His view is that Vietnam was a “success story in nation building”. Is there a nation of South Vietnam somewhere?
He also attributes Vietnam as having played a role in the winning of the Cold War by sucking resources from Russia. I wonder what Reagan would say about that.
“The Vietcong were largely suppressed by a combination of persuasion and force.” Fact or fantasy?
The nub of his advice: define a standard of competence for the Iraqi troops and, when that standard is met, start bringing US troops home in corresponding numbers. One of the problems I have with this advice is Laird is speaking in terms of quantitative standards only. I would think the quality of the troops would have some bearing on this decision. And, I think that Morton Halperin has some strong arguments here as to the degree of commitment - to Iraq as opposed to the insurgency - of some in the Iraqi forces. If Halperin is right, then Laird’s advice may only be a smokescreen for our exiting Iraq.
Laird is a veteran and has been at the heart of American policy making. Who am I to dispute his statement that “wars are fluid things and missions change”? From my comfortable, non-veteran’s chair, I would think this statement true with regard to battles or military campaigns. However, virtually every pre-21st century war that we have fought had, in my judgment a clear, constant mission.
He makes an interesting point about the effect of modern media on people’s attitude toward the war when he asks how much support WWII would have had if we could have seen the D-Day landing in real time. I believe that part of the backlash re Vietnam was the sight of the caskets coming home and the battles being fought on tv. That is clearly why Bush is trying to keep things as hidden from us as possible.
Laird also has some sound advice for Bush and Rumsfeld.
Advice for Bush
Tell America there is an exit strategy.
Level with the American people.
Articulate a simple message and mission, which is we are “fighting to preserve modern culture, Western democracy, the global economy and all else that is threatened by the spread of barbarism in the name of religion.”
Treat the people at Guantanamo more humanely as to continue not to “puts us on a slippery slope toward the inhumanity we deplore”.
Work with our traditional allies.
Advice for Rumsfeld
“show more deference to Congress” or soon they’ll stop funding your efforts in Iraq.
Fire the top people who allowed Abu Gharaib.
Tuesday, October 18, 2005
The Feds are still slow to move
Both FEMA and the SBA are not moving fast enough to help the victims of Katrina. Seven weeks after the storm here are some instances of their slow movement.
- FEMA has ordered hundreds of thousand of trailer homes, but only house families in 10,200 of them.
- FEMA has given shelter to 15,420 families, but the Red Cross is housing 625,000 people in hotels.
- SBA has received more than 116,000 applications and has approved 1700, most to homeowners not business people. The B in SBA stands for Business.
- Of the 5800 business loan applications made in Louisiana 22 have been approved.
- SBA has actually paid money to 146 people.
One place to cut the budget?
About 20% of the soldiers who have served in Iraq and 12% of those who have served in Afghanistan suffer from Post-Traumatic Stress Disorder (PTSD). A little over 210,000 veterans receive disability payments for PTSD from the government, costing $4.3 billion last year.
Not all who claim PTSD are approved for benefits. Since there is no standardized process for deciding a particular case, the odds of approval vary from state to state. The VA, as the result of an internal study, feels that some of those receiving benefits shouldn't be. In fact, they've estimated that 2.5% of the claims are potentially fraudulent. Thus, they have decided to review the cases of the 72,000 soldiers who are receiving the maximum benefit of just under $3000 a month. They may be right in their estimate of fraud, but that's due to the claims examiners being fooled. One question: Since the approval of claims is a function of where the claim originates rather than the severity of the problem, why is the VA not reviewing cases of those who have been denied benefits? If the claims examiners screwed up in approvals, it's likely they also screwed up in denials as well.
In the current review, veterans will have to prove that a specific incident was the cause of their PTSD. I doubt that reliving their war experience is a pleasant experience for anyone, even those who do not suffer from PTSD. Is this the right way to treat our veterans? There are a heck of a lot more places to cut the budget without insulting those who gave their all for us. How much will this review cost? They'd be better off putting the money into standardizing the claims review process.
Not all who claim PTSD are approved for benefits. Since there is no standardized process for deciding a particular case, the odds of approval vary from state to state. The VA, as the result of an internal study, feels that some of those receiving benefits shouldn't be. In fact, they've estimated that 2.5% of the claims are potentially fraudulent. Thus, they have decided to review the cases of the 72,000 soldiers who are receiving the maximum benefit of just under $3000 a month. They may be right in their estimate of fraud, but that's due to the claims examiners being fooled. One question: Since the approval of claims is a function of where the claim originates rather than the severity of the problem, why is the VA not reviewing cases of those who have been denied benefits? If the claims examiners screwed up in approvals, it's likely they also screwed up in denials as well.
In the current review, veterans will have to prove that a specific incident was the cause of their PTSD. I doubt that reliving their war experience is a pleasant experience for anyone, even those who do not suffer from PTSD. Is this the right way to treat our veterans? There are a heck of a lot more places to cut the budget without insulting those who gave their all for us. How much will this review cost? They'd be better off putting the money into standardizing the claims review process.
Closer to the finish line
Refco has agreed to sell its futures unit to J.C. Flowers and a group of other investors for $768 million and they'll be filing for Chapter 11, perhaps today. There is a slight chance that Dubai may top the current offer and go to $1 billion.
Alumni of Goldman Sachs, the lead underwriter of Refco's IPO, will still be involved with Refco. Flowers is ex-head of M&A at Goldman and the new chairman is also an ex-Goldman guy.
Alumni of Goldman Sachs, the lead underwriter of Refco's IPO, will still be involved with Refco. Flowers is ex-head of M&A at Goldman and the new chairman is also an ex-Goldman guy.
Monday, October 17, 2005
A trained Iraqi Army Is The Way To Go?
The administration has placed great store in the training of the Iraqi army. This article by Morton Halperin calls this investment a bad one. Halperin worries that we are doing exactly what we did in Vietnam: arming the enemy and providing sources for graft. He may have a point. Do we know what the desertion rate of the Iraqi army is?
More about competitiveness
I guess Krugman's column today spoke to the issue of our competitiveness, particularly relative to the outsourcing of manufacturing jobs . I 'guess' because I refuse to subscribe to Times Select.
Mark Thoma, an economist at the University of Oregon, has some interesting comments about the issue on his Economist's View blog. I say interesting because they agree with my comment earlier today about the need to recognize reality and start acting to ensure we maintain our competitiveness.
The comments about his view are also very good and challenging.
Mark Thoma, an economist at the University of Oregon, has some interesting comments about the issue on his Economist's View blog. I say interesting because they agree with my comment earlier today about the need to recognize reality and start acting to ensure we maintain our competitiveness.
The comments about his view are also very good and challenging.
Nearing the End?
It's been a heck of a week! It looks as though J.C. Flowers will be buying Refco's futures business and Refco Capital Markets will be put into bankruptcy later this week. Refco will probably go down in history as the fastest implosion ever.
Improving our competitive stance
Most of us have heard of the National Academy of Sciences and the National Research Council. Well, these two groups have combined with the National Academy of Engineering and the Institute of Medicine to form the National Academies, which brings together experts in science and technology. These experts donate their time and talent to tackle difficult national issues in the areas of science and technology. They have just announced their newest report, "Rising Above The Gathering Storm: Energizing and Employing America for a Brighter Economic Future". It fortifies the position I've taken here that we must focus more on how we educate our kids, particularly in those areas that lead to innovations.
The press release has a number of scary facts about our preparedness - or lack of it - in science and technology, the areas which made this country great. Two that are particularly frightening:
- Last year more than 600,000 engineers graduated in China, 350,000 in India and 70,000 in the US.
- In 2001 industry spent more on tort litigation than R&D.
The primary recommendations of the report are:
- Increase our talent pool by vastly improving our pre-college math and science education.
- Sustain and strengthen our commitment to long-term basic research.
- Develop, recruit and retain top students, scientists and engineers from the US and other countries.
- Ensure that this country is the premier place in the world for innovation.
Each of the recommendations is followed by a series of implementation steps to achieve these necessary goals.
Nobody's perfect
It ain't easy being squeaky clean. Few of us are. The Wall Street Journal reminds us today of some of the past companies that were clients of Grant Thornton, Refco's auditor: Parmalat, one of the biggest European accounting frauds ever; MCA Financial, a dead mortgage banking company. In both cases the primary charges against the companies by the authorities concerned accounting issues. The baldness of the previous statement does not mean that Grant Thornton is an amoral company; it just means that it may have some partners who are or some who are very gullible and believe whatever management says.
Clearly, the 21st century is not starting out as one on which accountants will look fondly years hence.
Clearly, the 21st century is not starting out as one on which accountants will look fondly years hence.
The buzzards are circling
Do a Google search for 'Refco'. The first item 'found' is the site for a parasitic law firm talking about a class action suit. It's not on the right side of the page where ads are. It's as though they're trying to hide it. I wonder what this cost them. Or, were they able to trick the saints at Google?
Sunday, October 16, 2005
A very busy Sunday
Refco has hired Greenhill & Co. as an adviser even though Goldman is doing their work pro bono. I wonder whether this has anything to do with the smell over Goldman's handling of the IPO.
Word is that J.C. Flowers, a private equity fund run by a former Goldman M&A guy, will be buying Refco's futures business.
Word is that J.C. Flowers, a private equity fund run by a former Goldman M&A guy, will be buying Refco's futures business.
No rest for the weary
Supposedly 50 or so advisers have been meeting over the weekend to try to save Refco. The advisers include Goldman Sachs, Grant Thornton and Thomas Lee Partners. If they didn't bother to read the IPO prospectus in August, why should they do any better now?
At least two firms have been reported sniffing around the carcass - Mann Financial from England and the Blackstone Group.
And effects are being felt overseas. The Austrian bank BAWAG P.S.K. is worried about getting paid back the multi-millions of dollars it loaned Bennett. The Indian subsidiaries of Refco are keeping their money in India and not forwarding it to New York.
At least two firms have been reported sniffing around the carcass - Mann Financial from England and the Blackstone Group.
And effects are being felt overseas. The Austrian bank BAWAG P.S.K. is worried about getting paid back the multi-millions of dollars it loaned Bennett. The Indian subsidiaries of Refco are keeping their money in India and not forwarding it to New York.
It gets worse
Gretchen Morgenson has a devastating column in today's NY Times about the sophisticated investors who put their - and our - money in Refco. She quotes from the prospectus used in the August IPO. Some excerpts from that document:
- Refco had no "formalized procedures for closing our books". This is a multi-billion dollar company and they can't close their books in an organized fashion?
- Refco was deficient in its ability to prepare financial statements "that are fully compliant with all SEC reporting guidelines on a timely basis". They, a financial company, are slow in meeting SEC reporting requirements?
- Refco seems to have been upfront in the prospectus. They even mentioned that they were under investigation by Spitzer and the SEC. And, that despite the CEO of Refco Securities facing suspension from his supervisory duties, he would remain with the firm "in his current capacities". So, you're telling me that I should invest in you even though you've violated the rules, got caught doing so and will keep doing it?
- Equity was .3% of assets. Other financial companies, such as Bear Stearns, are closer to 3.5%.
- Off-balance sheet derivatives went from $69 billion in February 2004 to $150 billion in May 2005. This statement from a firm that admits it can't close the books properly.
- Capital expenditures, which are largely for technology, were 1% of net revenues. Other firms in the business spent 3.5%
Saturday, October 15, 2005
Bayou is in today's news
but only peripherally as DePauw University has sued Hennessee Group, an investment adviser who supposedly completed "five levels of due diligence" in investigating Bayou Capital Management. This is the fund accused of defrauding investors since 1998. It looks as though the principals of Bayou have misused $200 million of client funds. DePauw thinks that Hennessee should have noticed something might be amiss and not invested DePauw funds with Bayou.
Not exactly unsophisticated investors
Here are some of the investors in Refco: TIAA-CREF, T Rowe Price, Oppenheimer Fund, Putnam Investments, Thomas Lee Partners, New York State Retirement Fund. Add in the underwriters: Goldman Sachs, Credit Suisse, Bank of America.
The underwriters saw the debt that is now in question but took the auditor's word that a hedge fund would pay it back.
The underwriters saw the debt that is now in question but took the auditor's word that a hedge fund would pay it back.
The new guy on the block
Apparently a new employee in Refco's controller's office asked the right questions about the many hundred millions of debt owed to Refco; this is the debt that Grant Thornton, the auditors in Refco's August IPO (yep, that's two months ago), assured the underwriters that a hedge fund would pay back. I guess the new guy wasn't as trusting as the underwriters and pursued matters to the point where they finally uncovered Bennett's scheme.
I wonder if the new guy will still have a job should Refco enter Chapter 11.
I wonder if the new guy will still have a job should Refco enter Chapter 11.
Not the first time
It's not really that unusual for investment firms to be fined by the feds for one peccadillo or another. Sometimes the company's actions are really peccadillos, many times they are not. Need I say that Refco is one of those companies.
In 1983 the company was fined a then-record $525,000 for excessive speculation. In 1999 the company paid $8 million in penalties with regard to charges of manipulating customer accounts and another $7 million for failing to comply with rules re order-taking and recordkeeping of customer accounts. And, Refco was the company that handled Hillary Clinton's wildly successful futures trading, but was not accused of any malfeasance in that case.
In 1983 the company was fined a then-record $525,000 for excessive speculation. In 1999 the company paid $8 million in penalties with regard to charges of manipulating customer accounts and another $7 million for failing to comply with rules re order-taking and recordkeeping of customer accounts. And, Refco was the company that handled Hillary Clinton's wildly successful futures trading, but was not accused of any malfeasance in that case.
Timing is everything
The failure of Phil Bennett, ex-CEO of Refco, to repay the money to the company before the news of the falsification hit the streets is the most curious aspect of this whole situation. He obviously had access to $430 million somewhere.
Had he made restitution before the news of the company's accounting falsification become public would Refco be in as sorry a condition as it now is? Sure, Bennett would still be out $430 million and chances are he would still be an ex-CEO, but it's likely he would have been allowed to resign, thus preserving some measure of dignity. I don't see how the company could have kept the falsification hidden, so Bennett would probably still have been indicted. But, I don't think the run to the hills by Refco's industry partners and bankers would have been so precipitous. And, it is this run to the hills that has put the company in such dire straits.
Clearly, it takes time to convert $430 million into cash. It's doubtful that Bennett had this much money stashed in a cookie jar. So, maybe he tried to repay the money before the bad news came out, but his timing was bad.
Had he made restitution before the news of the company's accounting falsification become public would Refco be in as sorry a condition as it now is? Sure, Bennett would still be out $430 million and chances are he would still be an ex-CEO, but it's likely he would have been allowed to resign, thus preserving some measure of dignity. I don't see how the company could have kept the falsification hidden, so Bennett would probably still have been indicted. But, I don't think the run to the hills by Refco's industry partners and bankers would have been so precipitous. And, it is this run to the hills that has put the company in such dire straits.
Clearly, it takes time to convert $430 million into cash. It's doubtful that Bennett had this much money stashed in a cookie jar. So, maybe he tried to repay the money before the bad news came out, but his timing was bad.
Friday, October 14, 2005
Huh?
Yesterday Refco said its securities unit was "substantially unaffected by the events of this week". Today they're shutting it down. The mysteries increase.
Thursday, October 13, 2005
Even the smart guys can get taken
Bayou, Wood River, Refco - three investment firms that have been in the news recently mainly because of what looks like fraud in each case. And in each case it looks like the people who ran these firms were able to defraud very sophisicated investors. Was it greed that caused these sophisticates to be taken? Was it laziness?
Consider Wood River.
Through August they claimed a return of 25% while the Dow was down almost 3%. In prior years they didn't do as well, only 22%. Apparently few read the footnote which said that none of their returns had been audited.
They failed to file forms with the government listing their holdings or their ownership of more than a 5% stake in companies.
The owner of the firm had accumulated tax liens of $265,000 between 2002 and 2004.
The company had been sued by First Boston for non-payment of shares bought.
They claimed Morgan Stanley as primary broker; Morgan Stanley does not support the claim.
They said NAV consulting did their accounting; NAV consulting denies it.
The landlord sued for unpaid rent in 2002.
Refco and Bayou were a little more circumspect, but still fraudulent enough to suck in a lot of sophisticated investors such as Stern Investors and Thomas H. Lee Partners.
Consider Wood River.
Through August they claimed a return of 25% while the Dow was down almost 3%. In prior years they didn't do as well, only 22%. Apparently few read the footnote which said that none of their returns had been audited.
They failed to file forms with the government listing their holdings or their ownership of more than a 5% stake in companies.
The owner of the firm had accumulated tax liens of $265,000 between 2002 and 2004.
The company had been sued by First Boston for non-payment of shares bought.
They claimed Morgan Stanley as primary broker; Morgan Stanley does not support the claim.
They said NAV consulting did their accounting; NAV consulting denies it.
The landlord sued for unpaid rent in 2002.
Refco and Bayou were a little more circumspect, but still fraudulent enough to suck in a lot of sophisticated investors such as Stern Investors and Thomas H. Lee Partners.
Wednesday, October 12, 2005
Moving into space
The second Chinese launch into space this week is quite different from their first launch two years ago. Yes, there is one more astronaut (two now vs. one in the first launch) and they will be staying up for five days (as opposed to 1 the first time). But, the big news is that it was shown on Chinese television. I suspect that the TV show was for our benefit as well as for the Chinese people.
Putting food on the table
Change is hard, especially when you are making a fair amount of money now and may not be making as much if things change. So, some large food and shipping companies, such as Cargill and Archer Daniels Midland, are concerned about a Bush administration proposal to change our Food Aid programs.
Our Food Aid programs, which are the largest in the world, started under Eisenhower when we had huge government stockpiles of food and sending it overseas was a good way to help poor countries as well as the farmers. To make sure we would help the farmers the law said only American-grown food could be shipped under this program.
Well, the world has changed a lot in fifty years. Most of the farmers who grew all that food in the '50s have been replaced by agribusiness. And, our stockpiles are nowhere near as huge as they once were. Yet, we're operating the same way despite the fact that the $2 billion of food shipped under this program is very small change in the overall income of the farm industry. So, it would seem that changing the program to better fit today's needs would have very little effect on our farming industry; in fact, change may enable more food to be put on poor people's plates and to be put there quicker.
One proposed area of change is the use of food grown closer to where there are food shortages, i.e., in Africa. Requiring the use of American-grown food results in the Food Program budget spending about as much on shipping the food as on the food itself. Thus, even if it cost as much to grow crops in Africa as in the US, the result of this aspect of the proposal would be more food on the plate. Further, having food near to or already in the general area of need likely would result in food being available for starving people much sooner than if the food has to be shipped across the Atlantic.
If one is looking for budget savings, the effects of the current law provides another area for such savings. Now, NGOs sell much of the food they receive to raise money to address the causes of the lack of food. As noted above, the cost of the food NGOs receive includes the 50% shipping portion. The NGO and the US taxpayer would be better off if we just gave them an outright grant representing the value of the food alone.
You probably didn't expect me to say this but the Bush adminstration deserves credit for trying to get more food on the table.
Our Food Aid programs, which are the largest in the world, started under Eisenhower when we had huge government stockpiles of food and sending it overseas was a good way to help poor countries as well as the farmers. To make sure we would help the farmers the law said only American-grown food could be shipped under this program.
Well, the world has changed a lot in fifty years. Most of the farmers who grew all that food in the '50s have been replaced by agribusiness. And, our stockpiles are nowhere near as huge as they once were. Yet, we're operating the same way despite the fact that the $2 billion of food shipped under this program is very small change in the overall income of the farm industry. So, it would seem that changing the program to better fit today's needs would have very little effect on our farming industry; in fact, change may enable more food to be put on poor people's plates and to be put there quicker.
One proposed area of change is the use of food grown closer to where there are food shortages, i.e., in Africa. Requiring the use of American-grown food results in the Food Program budget spending about as much on shipping the food as on the food itself. Thus, even if it cost as much to grow crops in Africa as in the US, the result of this aspect of the proposal would be more food on the plate. Further, having food near to or already in the general area of need likely would result in food being available for starving people much sooner than if the food has to be shipped across the Atlantic.
If one is looking for budget savings, the effects of the current law provides another area for such savings. Now, NGOs sell much of the food they receive to raise money to address the causes of the lack of food. As noted above, the cost of the food NGOs receive includes the 50% shipping portion. The NGO and the US taxpayer would be better off if we just gave them an outright grant representing the value of the food alone.
You probably didn't expect me to say this but the Bush adminstration deserves credit for trying to get more food on the table.
Tuesday, October 11, 2005
Is the symphony dying?
Last Friday we went to the Boston Symphony concert. The program included pieces by Ives, Carter, Foss and Gershwin (not exactly stuff aimed at geriatrics), yet the hall was filled with 'senior citizens'. I'd guess that the average age was 75, if not 80. I hadn't seen so many people with walkers, wheelchairs and canes since my last visit to the orthopedic section of the hospital. The buses that had taken them there from all over New England were lined up outside, many of the buses bore the logo of the assisted living center where the passengers lived. It looks like the Symphony is pitching to we old folks as the most frequently advertised item in the program was retirement homes.
Where were the young people? I did see, maybe, 20 people under 50 there. The hall holds about 1500. Have the young deserted the world of symphonic music?
Where were the young people? I did see, maybe, 20 people under 50 there. The hall holds about 1500. Have the young deserted the world of symphonic music?
Monday, October 10, 2005
A hopeful sign?
Today on NPR there was a report on the increase in plastic surgery in Iraq - cosmetic plastic surgery, that is, noses trimmed, breast augmented, tummies tucked. One doctor reported doing three procedures a day, two on women, one on men. People from Jordan and Syria risk coming to the war zone that is Baghdad to be transformed into a "more attractive" person.
You have to admire the human spirit that, in the midst of carnage, wants to look like the latest pop star although they may be blown up tomorrow.
You have to admire the human spirit that, in the midst of carnage, wants to look like the latest pop star although they may be blown up tomorrow.
Executive Order 13233
I learned today of Executive Order 13233, which Bush signed in 2001. This order restricts our ability to learn what was going on in a previous president's administration. Before this order was signed, the Presidential Records Act of 1978 applied; this act said that all papers, except those pertaining to national security, had to be made available 12 years after a president left office. The executive order authorizes the release only with the approval of both the former president or his heirs and the current president.
So, will we or our children ever know the details behind Bush's actions in office? The order has already affected the papers of Bush Senior and Clinton. Why was any time spent on even considering this order, particularly as the order was signed less than two months after 9/11?
Historians are up in arms about this. The American Historical Association has gone to court over it. Let's hope they prevail.
Sunday, October 09, 2005
Where he gets them
I've often wondered where Bush has found the people that populate his administration. Many of them, particularly on the sub-cabinet level, do not seem to have a great deal of experience in the field they are now supervising, Brown being the most obvious example. Nor, if the truth be told, does there seem to be an abundance of talent. Now, the New Republic has published a list of those they deem to be the least qualified and how they came to hold positions of power in what is still our government. Check it out. It's funny, yet very sad.
What kind of housing is this?
Apparently some FEMA contractors or people working for FEMA contractors are going around the country recruiting laborers to clean up the mess on the Gulf Coast. While I'd rather see the restoration and rebuilding work given to the hurricane victims, I can understand that many of the victims may not yet be able to work. But the work must get done. Hence, the recruiting effort.
The problem I have with this effort concerns some lowlife recruiters who either supply inhuman shelter (e.g., tents but no toilets or running water) to the workers or expect the Red Cross to put up these workers. For example, one worker recruited from New Jersey thought he'd be getting $120 a day plus housing. What he got when he was far from home was $80 a day and a possibility of being housed at a Red Cross shelter, which was designed to house the victims.
What kind of people would stoop so low?
The problem I have with this effort concerns some lowlife recruiters who either supply inhuman shelter (e.g., tents but no toilets or running water) to the workers or expect the Red Cross to put up these workers. For example, one worker recruited from New Jersey thought he'd be getting $120 a day plus housing. What he got when he was far from home was $80 a day and a possibility of being housed at a Red Cross shelter, which was designed to house the victims.
What kind of people would stoop so low?
It looks like a lot to me
The Veterans Administration reports that about 49,000 veterans of the Iraq and Afghanistan conflicts were treated at a VA facility between October 2003 and February 2005. I don't know how many have served in these two conflicts, but I'd be surprised if it were 500,000. If I'm close to being correct, that means that almost 10% of our troops have been injured in these conflicts. That's a hell of an injury rate.
Saturday, October 08, 2005
Gitmo Again
The International Red Cross has once more expressed concern about the 'detainees' that are on a hunger strike at Guantanamo. The military claims that there are only 28 on strike; others say the number is much higher perhaps as many as 200. I wonder whether McCain's proposal on how we should treat detainees will pass both houses. If it does, perhaps the situation might change.
Too Cynical?
I can see them sitting around the Oval Office.
"Well, Karl, things ain't looking too good. Brownie screwed up in Louisiana. The @#$% Iraqis are killing my poll numbers. The market's down a couple of hundred points. No one's buying my Social Security plan. People are going ape over the price of gas. We gotta do something."
"We don't actually have to do something which will really mean that the public will have to sacrifice or will cause company's profits to sink. We have to look presidential. And after screwing up in Louisiana, we've got to show that we're doing something about a real hazard. Like, we're actually planning well and implementing well.
What about this bird flu noise? We screwed up in getting flu vaccine last year. How would it look if we did something about bird flu? Heck, one scientist predicted 150,000,000 people might die if the thing got out of hand and the flu passed from bird to person to person.
I bet, if we talked about this imminent danger and actually met with some drug companies and paid them off to produce a vaccine, our poll numbers will jump. People forget easily. We'll start issuing press releases, pay off media personalities to talk up the problem - oops, paying media people is now out in public, so we better not do that -, have you make a major speech or two about it. You know the usual routine of talking, but not acting."
"Great ideas as usual, Karl. Get Leavitt in here."
"Well, Karl, things ain't looking too good. Brownie screwed up in Louisiana. The @#$% Iraqis are killing my poll numbers. The market's down a couple of hundred points. No one's buying my Social Security plan. People are going ape over the price of gas. We gotta do something."
"We don't actually have to do something which will really mean that the public will have to sacrifice or will cause company's profits to sink. We have to look presidential. And after screwing up in Louisiana, we've got to show that we're doing something about a real hazard. Like, we're actually planning well and implementing well.
What about this bird flu noise? We screwed up in getting flu vaccine last year. How would it look if we did something about bird flu? Heck, one scientist predicted 150,000,000 people might die if the thing got out of hand and the flu passed from bird to person to person.
I bet, if we talked about this imminent danger and actually met with some drug companies and paid them off to produce a vaccine, our poll numbers will jump. People forget easily. We'll start issuing press releases, pay off media personalities to talk up the problem - oops, paying media people is now out in public, so we better not do that -, have you make a major speech or two about it. You know the usual routine of talking, but not acting."
"Great ideas as usual, Karl. Get Leavitt in here."
Friday, October 07, 2005
A slap in the face?
Is the award of the Nobel Peace Prize to El-Baradei an insult to the Bush administration?
Thursday, October 06, 2005
God talks to him
It looks like the BBC has issued a rather startling press release about a new series they will be running about the Israel/Palestine issue.
The release quotes the Palestinian Foreign Minister, Nabil Shaath, as saying: "President Bush said to all of us: 'I'm driven with a mission from God. God would tell me, "George, go and fight those terrorists in Afghanistan." And I did, and then God would tell me, "George, go and end the tyranny in Iraq …" And I did. And now, again, I feel God's words coming to me, "Go get the Palestinians their state and get the Israelis their security, and get peace in the Middle East." And by God I'm gonna do it.'"
The release quotes the Palestinian Foreign Minister, Nabil Shaath, as saying: "President Bush said to all of us: 'I'm driven with a mission from God. God would tell me, "George, go and fight those terrorists in Afghanistan." And I did, and then God would tell me, "George, go and end the tyranny in Iraq …" And I did. And now, again, I feel God's words coming to me, "Go get the Palestinians their state and get the Israelis their security, and get peace in the Middle East." And by God I'm gonna do it.'"
Wednesday, October 05, 2005
Why airlines lose money
A couple of days ago I wrote about companies that use private aircraft to transport their CEOs for golfing as well as business purposes. Today, I'd like to talk about NASA, which also has a real penchant for private planes.
This penchant manifests itself in a fleet of planes NASA uses to transport its people, usually senior executives, on relatively routine business matters. Now it so happens that this type of transportation violates a policy that the federal government has had in place for a while: Federal agencies can own aircracft only as needed to meet specific requirements, such as transporting prisoners or doing aeronautical research. The GAO has shown that 86% of the flights taken by NASA's planes in 2003 and 2004 were for routine business in direct violation of federal policy.
Further, this transportation is very expensive. GAO has estimated that in the wonderful years of 2003 and 2004 NASA's reported air travel costs of $25,000,000 would have been only $5,000,000 had they used commercial airlines. Notice the words "reported costs". These costs apparently exclude such rare items as depreciation.
So, our employees are violating policies and spending a lot more of our money than they should. And DeLay says that there is no fat in the budget!
This penchant manifests itself in a fleet of planes NASA uses to transport its people, usually senior executives, on relatively routine business matters. Now it so happens that this type of transportation violates a policy that the federal government has had in place for a while: Federal agencies can own aircracft only as needed to meet specific requirements, such as transporting prisoners or doing aeronautical research. The GAO has shown that 86% of the flights taken by NASA's planes in 2003 and 2004 were for routine business in direct violation of federal policy.
Further, this transportation is very expensive. GAO has estimated that in the wonderful years of 2003 and 2004 NASA's reported air travel costs of $25,000,000 would have been only $5,000,000 had they used commercial airlines. Notice the words "reported costs". These costs apparently exclude such rare items as depreciation.
So, our employees are violating policies and spending a lot more of our money than they should. And DeLay says that there is no fat in the budget!
Tuesday, October 04, 2005
More of our money down the drain
In 2000 Congress passed the Continued Dumping and Subsidy Offset Act. That's a wonderfully meaningless name for an act half of whose benefits have gone to five companies. And, the benefits have not been small: $1 billion between FY2001 and FY2004. The GAO has just issued a report on the effectiveness of this law, which is known as the Byrd Amendment.
From the formal name of the act you can conclude that it somehow helps those hurt in some way by foreign competitors who 'dump' their goods here at a low price. But, rather than cover all industries that might be affected by dumping, just about all of the money goes to only three industries: ball bearings, steel or candles.
Furthermore, rather than cover all companies in a particular industry, only those companies that filed a petition for relief or that publicly supported the petition during a givernment investigation to determine whether injury had occurred are eligible. So, unless you screamed that you were getting hurt and filed the appropriate paperwork, you were ineligible for any cash.
The paperwork for this act is handled by Customs and Border Protection (sidebar: shoudn't they be watching our borders?). They have a very hard time meeting the requirements of the act to pay everybody within 60 days after a new fiscal year starts. Part of the problem is a lack of standardization and use of automation.
Because Customs is not very efficient in implementing this law, most companies do not have to support their claims. What this has led to is a situation where, because the claims cannot be handled, your chances of getting money under this law is a function of how many claims you file. The more claims you file, the more money you collect. That's right, Customs pays claims on a pro-rata basis. Which is why claims have just about doubled from $1 trillion in 2001 to almost $2 trillion in 2004.
As a capstone to this inefficiency, Customs has a major problem in collecting the duties from which the claims are to be paid. About half of the funds due are still not collected.
And, you may remember, that the World Trade Organization found that this act violated agreements we had made under the auspices of that organization. This will lead to our paying more tariffs on our exports.
This sounds like a really stupid bill, right? Here's one place we could find some money to fund the hurricane disaster relief effort. Well, 70 of our Senators have signed a letter in support of this act.
Go figure.
From the formal name of the act you can conclude that it somehow helps those hurt in some way by foreign competitors who 'dump' their goods here at a low price. But, rather than cover all industries that might be affected by dumping, just about all of the money goes to only three industries: ball bearings, steel or candles.
Furthermore, rather than cover all companies in a particular industry, only those companies that filed a petition for relief or that publicly supported the petition during a givernment investigation to determine whether injury had occurred are eligible. So, unless you screamed that you were getting hurt and filed the appropriate paperwork, you were ineligible for any cash.
The paperwork for this act is handled by Customs and Border Protection (sidebar: shoudn't they be watching our borders?). They have a very hard time meeting the requirements of the act to pay everybody within 60 days after a new fiscal year starts. Part of the problem is a lack of standardization and use of automation.
Because Customs is not very efficient in implementing this law, most companies do not have to support their claims. What this has led to is a situation where, because the claims cannot be handled, your chances of getting money under this law is a function of how many claims you file. The more claims you file, the more money you collect. That's right, Customs pays claims on a pro-rata basis. Which is why claims have just about doubled from $1 trillion in 2001 to almost $2 trillion in 2004.
As a capstone to this inefficiency, Customs has a major problem in collecting the duties from which the claims are to be paid. About half of the funds due are still not collected.
And, you may remember, that the World Trade Organization found that this act violated agreements we had made under the auspices of that organization. This will lead to our paying more tariffs on our exports.
This sounds like a really stupid bill, right? Here's one place we could find some money to fund the hurricane disaster relief effort. Well, 70 of our Senators have signed a letter in support of this act.
Go figure.
He told them so, but few believed him
Barry Marshall, the winner of this year's Nobel Prize in medicine, had a very hard time convincing the medical establishment that peptic ulcers were not caused by stress; it was bacteria that was doing it. He came to this conclusion early in his carreer but was unable to get funding. So, most of his research was done in off-hours. But he persisted. His most dramatic experiment was on himself; he drank a potion filled with bacteria. Lo and behold, he came down with a severe case of peptic ulcers.
He is an Australian and I wonder whether that had anything to do with the reception he received in the scientific community.
He is an Australian and I wonder whether that had anything to do with the reception he received in the scientific community.
The 55 Year War
Did you know that North and South Korea have yet to sign a peace treaty although fighting ended in 1953? I didn't. But I learned that little fact plus a few more at today's Conversation Group.
For example, we seem to be at just about the same point with North Korea today as we were in 1994. The Bush administration has proposed just about the same settlement the Clinton people had proposed.
And, our policy of preemption was one of the likely causes of North Korea backing away from its original settlement offers.
Our handling of North Korea has raised a lot of issues about our diplomatic skills. But that's a story for another day.
For example, we seem to be at just about the same point with North Korea today as we were in 1994. The Bush administration has proposed just about the same settlement the Clinton people had proposed.
And, our policy of preemption was one of the likely causes of North Korea backing away from its original settlement offers.
Our handling of North Korea has raised a lot of issues about our diplomatic skills. But that's a story for another day.
Monday, October 03, 2005
That's 2
A different grand jury returned a different indictment against Tom DeLay. This one is for money laundering. I guess there is another group of Texans that has a vendetta against him.
Sunday, October 02, 2005
Does he listen to his people when they testify before Congress?
In yesterday's radio talk to the nation our president said, "I'm encouraged by the increasing size and capability of the Iraqi security forces. Today they have more than 100 battalions operating throughout the country, and our commanders report that the Iraqi forces are serving with increasing effectiveness."
This week his generals told the Senate that the number of self-supporting Iraqi battalions has dropped from three to one, Iraq police and army units are riddled with insurgents, and the border between Iraq and Syria is still not under our control. How could he possibly be encouraged? Does he take us for complete idiots?
This week his generals told the Senate that the number of self-supporting Iraqi battalions has dropped from three to one, Iraq police and army units are riddled with insurgents, and the border between Iraq and Syria is still not under our control. How could he possibly be encouraged? Does he take us for complete idiots?
Karen Hughes visits the Arabs
Sidney Blumenthal doesn't think too highly of her efforts in this article from the Guardian.
Saturday, October 01, 2005
The Flying, Golfing CEO
In May I wrote about air travel perks of corporate CEOs. Apparently, golfing is one of the uses CEOs make of their private - oops, company - planes. No less than the capitalist press (aka The Wall Street Journal) has a lengthy article about this practice.
The article names about ten CEO/golfers and has made good use of the web to correlate golf scores (courtesy of the USGA) with flight records (from aviation-data services). Most of these companies argue that their security policy demands that the CEO always fly in private planes, the board has approved the flights and SEC rules are followed. Well, I wonder who sets these security policies and appoints the board? Usually the golfing CEO. And the SEC rules are a joke. On a flight that costs about $25k the CEO may pay a couple of hundred bucks more in income tax.
Here are some typical examples of misusing the shareholders' money:
The article names about ten CEO/golfers and has made good use of the web to correlate golf scores (courtesy of the USGA) with flight records (from aviation-data services). Most of these companies argue that their security policy demands that the CEO always fly in private planes, the board has approved the flights and SEC rules are followed. Well, I wonder who sets these security policies and appoints the board? Usually the golfing CEO. And the SEC rules are a joke. On a flight that costs about $25k the CEO may pay a couple of hundred bucks more in income tax.
Here are some typical examples of misusing the shareholders' money:
- The Alltel jet has landed 165 times over the last four years at Augusta, GA, where the chairman and his son are members of the golf club there. They golf about four of every five weekends.
- The chairman of Motorola, based in Illinois, has traveled at least once a month this year to his house on a golf course in Carmel, CA. A consulting firm estimates that each flight costs more than $46,000.
- The National City Bank jet transported its chairman here to the Vineyard Golf Club nine times during the nine weeks that made up July and August this year.
- The head of Cintas wrote in a book given to employees, "We have a Spartan attitude about our business. We are not concerned with the frills of expensive restaurants, fancy offices or luxurious accommodation." This guy is worth $1.4 billion, yet in seven months (November 2004 - May 2005) he managed to have his company plane bring him to the Ocean Reef Club in Key Largo 24 times; that's almost once a week.
Spending our money wisely
WWII was a bonanza for many companies as the government issued contracts almost willy-nilly. In some of these contracts the government was being ripped off. Enter Senator Harry Truman. He led an investigative committee that looked into many of these contracts and was able to return a significant amount of money to the public coffers from those companies that were considered war profiteers.
In the Spring of this year a bill was introduced to create a similar committee to look into the contracts let for our wars in Afghanistan and Iraq. Although the bill was sponsored by a Democrat and a Republican, it was defeated largely on a party line vote.
It is becoming more and more evident that there has been considerable waste and unseemly profiteering in fighting our 21st century wars, while, at the same time, we cannot adequately arm our troops to fight those wars. And, it looks like financing the recovery from Hurricanes Katrina and Rita will also result in a fair amount of boondoggling.
Hundreds of billions of our dollars are being spent with very little oversight that the money is being spent wisely.Why does our government refuse to see that our money is being spent wisely?
In the Spring of this year a bill was introduced to create a similar committee to look into the contracts let for our wars in Afghanistan and Iraq. Although the bill was sponsored by a Democrat and a Republican, it was defeated largely on a party line vote.
It is becoming more and more evident that there has been considerable waste and unseemly profiteering in fighting our 21st century wars, while, at the same time, we cannot adequately arm our troops to fight those wars. And, it looks like financing the recovery from Hurricanes Katrina and Rita will also result in a fair amount of boondoggling.
Hundreds of billions of our dollars are being spent with very little oversight that the money is being spent wisely.Why does our government refuse to see that our money is being spent wisely?
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