Tuesday, July 31, 2012

Rally Against Fracking

I didn't see anything in the media about this weekend's DC Stop the Frack Attack Rally.    It was sponsored by 136 local and national organizations.  I'm not sure how many came, but there is talk of thousands attending.  Rallies are planned for New York and Pennsylvania.

Will the movement develop traction?

Some good news

Year Up is an organization that has been around for twelve years helping low-income urban teenagers find good jobs. Here are some of its accomplishments, as seen by its founder: "80 percent of Year Up’s graduates are employed or in school full time within four months of completing the program. Employed graduates average about $15 an hour, more than double the minimum wage, and experts estimate that spending 12 months at Year Up will increase graduates’ lifetime earnings by $1 million."

The organization is active in cities from Boston to San Francisco.  Boston started out with 20 students, now it serves 200 every year.  The program does have high expectations for its students.  For example, being late for class could mean loss of $20 from the student's daily stipend of $30.   During the first six months of the program, they learn attitudinal, behavior, and communication skills, and the second part is learning technical or financial skills.

YearUp has placed graduates is over 250 companies across the country.  Many of the companies are household names - Google, eBay, Bank of America, Wells Fargo, and Coca-Cola.

Wasting our money

English: M1 Abrams tank with 105mm cannon at G...
English: M1 Abrams tank with 105mm cannon at Grafenwöhr, 1986. (Photo credit: Wikipedia)
Surprisingly, the Pentagon wants to save money ($3 billion) by freezing refurbishment of the M1 tank from 2014 to 2017, so it can redesign the tank.  Unsurprisingly, Congressmen from the districts where this refurbishment would be done don't think much of the Pentagon's idea as it will cost jobs in their districts.

It's not as though the M1 is a sine qua non of our defense strategy.  We have 2,300+ of them being used today, but there are 3,000 more getting the sun's rays as they sit at a base in the Sierra Nevada mountains.  The tank may have seen its day as we wage counterinsurgency war in that they are quite vulnerable to IEDs.

Maybe we could use that money to start fixing our infrastructure.

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Could it happen here?

On Monday one of India's power grids failed affecting an estimated 300,000,000. On Tuesday, three - including one that failed the previous day also - of India's power grids failed affecting an estimated 600,000,00.  Officials are not sure exactly why.  Some speculate that some states are exceeding their power quota but clearly part of the problem is the age of the grid.

How old is our electrical grid?  Will we be waiting for the power to be turned back on?

Monday, July 30, 2012

A different way to treat bank fraud

The 39 fraudsters forged letters of credit from a bank to fund dozens of companies and buy a state-owned steel factory.  The trial found them all guilty; four, including the ringleaders, were sentenced to death. two to life, the rest to jail sentences of up to 25 years.  Some were also flogged and had to pay fines.

What country is this that really punishes bad bankers?


"We cannot just throw money at a country like this and expect it to have a good ending.”

That's what Senator Claire McCaskill says about our reconstruction efforts in Afghanistan.  And the latest report from the Inspector General backs her up: “Implementing projects that the Afghan government is unable to sustain may be counter­productive” to the U.S. counterinsurgency mission, the inspector general wrote. “If goals are set and not achieved, both the U.S. and Afghan governments can lose the populace’s support.”

The IG looked at many projects being funded by the Afghan Infrastructure Fund, which has almost $2 billion to bring Afghanistan close to the 21st century.  The report looks primarily at roads and power generation projects and it finds them woefully late and questions their efficacy.  Furthermore, there is considerable doubt as to whether Afghanistan can maintain these projects when we leave.

Are we wasting money while increasing the odds of another country that feels we have made matters worse there?

Sunday, July 29, 2012

The Coup That Failed In The Long Run

Prime Minister Mohammed Mossadegh of Iran wave...
Prime Minister Mohammed Mossadegh of Iran waves as he leaves Union Station for the Iranian Embassy in Washington D.C. (Photo credit: Wikipedia)
I'm talking about the 1953 overthrow of Iran's democratically elected Prime Minister Mohammad Mossadegh by England and the U.S.A.  In the view of Christopher de Bellaigue, this was a major error on our part.  De Bellaigue contends that:
Mossadegh’s Iran would have tilted to the West in foreign affairs, bound by oil to the free world and by wary friendship to the US, but remaining polite to the big neighbor to the north.
In home affairs, it would have been democratic to a degree unthinkable in any Middle Eastern country of the time except Israel—a constitutional monarchy in a world of dictatorships, dependencies and uniformed neo-democracies. 
The reason for the coup was Mossadegh’s nationalization of the Anglo-Iranian Oil Company (AIOC) in 1951.  This riled England no end.

The coup benefited no one:
It embedded a fathomless Iranian suspicion that would find expression in the seizure of US diplomats after the 1979 revolution.
It did nothing to halt British decline.
It thrust the United States into support for Middle Eastern tyrants able, they claimed, to deliver oil and stability—a strategic position at odds with American values. 
It set Iran on a self-defeating zigzag between embrace of the West (the Shah) and embrace of the Prophet (the postrevolutionary theocracy), a path that has led to isolation and the alienation of most Iranians from their repressive polity.
Almost sixty years later we're threatening Iran again.  Granted it is a different Iran, but is there not another way but war to resolve the issue?
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Saturday, July 28, 2012

Think before you act

Ryan Crocker is retiring as our Ambassador to Afghanistan. He has three "rules" for his successor and us:
  • Remember the law of unintended consequences. 
  • Recognize the limits of the United States’ actual capabilities. 
  • Understand that getting out of a conflict once you are in can often be dangerous and as destructive for the country as the original conflict.
And a couple of interesting quotes:
  •  “You better do some cold calculating, you know, about how do you really think you are going to influence things for the better.” 
  • “We’re a superpower, we don’t fight on our territory, but that means you are in somebody else’s stadium, playing by somebody else’s ground rules, and you have to understand the environment, the history, the politics of the country you wish to intervene in.”
  I'm not so sure he has been following his rules and observations.  Look at these and tell me what you think.
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Thursday, July 26, 2012

If I had a gun, I could protect myself and others

That's one of the mantras of those opposing gun control.  Today's NY Times has op-eds debunking that mantra.  Both a police officer and an infantry officer assert that it's highly unlikely that the average gun holder will actually be able to use his gun in an emergency.  

The police officer lays out the scene in Aurora: "speakers blasting, larger-than-life heroes and villains on the screen, and suddenly real gunshots, a man in a gas mask firing one of three weapons — a shotgun, handgun and rifle, with extended magazines for extra ammo capacity — into the panicking crowd. Even a highly trained, armed police officer would have been caught off guard. Try adding a bunch of untrained, armed civilians into the mix — this type of intervention could have made things much worse." 

The infantry officer reminds us that since 2005, "there isn’t a single example of a concerned bystander with a concealed-carry permit who stopped a mass shooting".  He recognizes that there "will always be violent loners. If they don’t kill with guns, they’ll find some other way to do it. Semiautomatic weapons, however, are what enable them to shoot dozens of people in a movie theater. Is someone’s right to buy an assault rifle worth having to carry a weapon yourself, every moment you’re outside your home, for the rest of your life?"

Hoarding Cats

We're #1

We own more guns per 100 than any other country in the world.  According to The Guardian we have almost one gun for every person: 270,000,000 civilian firearms works out to 88.8 for every 100 people.  The Guardian's data is based on the United Nations Office on Drugs and Crime and the Small Arms Survey to map the number of guns and gun deaths around the world.

Wednesday, July 25, 2012

Is real financial regulation possible?

This is a popular subject.  Today alone there are four commentators on the subject: James Kwak, Felix Salmon, James Surowiecki and John Kay.  All seem to endorse Kay's definition of the basic purpose of a financial system: "to enable savers to have confidence in borrowers whom they do not know: confidence that they will earn the returns they expect and be able to realise their investment when they need funds."  It is hard to generate that confidence in an environment of hyperactive trading by people who have no real relationship to other traders beyond the attempt to make money.

Kay believes that the regulators look at the world through the eyes of the traders rather than the investors whom the traders are supposed to serve.

Another problem arises by the fact that things change.  As Kay writes, "A large part of the problem is the way in which financial tools which had a utilitarian purpose when initially designed have become primarily vehicles for financial speculation. Libor, for instance, was a way for banks to peg loan rates to their own funding costs, and thereby minimize their own risks while at the same time minimizing the amount that borrowers had to pay. Today, banks don’t fund on the interbank market any more, and Libor has become something else entirely: a number to be speculated on in the derivatives market, and, in times of crisis, an indication of how creditworthy banks are perceived to be."
Kay believes we should simplify the rules and the financial industry.  Use broad fiduciary standards as the policing vehicle.  Break up the behemoths.

Tim doesn't like the book

The book is Bailout: An Inside Account of How Washington Abandoned Main Street While Rescuing Wall Street by Neil Barofsky, who was the TARP IG.  And "Tim", if you didn't know, is Tim Geithner, Treasury Secretary.  

Tim appeared on Charlie Rose last night.  Rose brought up one of the basic points of the book: Geithner was too close to the banks when he was leading the New York Federal Reserve.  Geithner's response:  "You know, I'm deeply offended by that. I find that deeply offensive. You know, it's the result of a urban myth."

Look here for more of Barofsky's comments about Tim and his role with TARP.

More than the usual summer melting

In a typical summer about half of the ice sheet in Greenland melts.  Summer 2012 is quite different.  In four days from July 8 to 12 melting of the surface went from 40% to about 97%. How  much of the entire glacier melted is not known.  Nor is it known whether this extensive melt event will affect the overall volume of ice loss this summer and contribute to sea level rise.  This phenomenon has occurred before, 1889 being the most recent.

There is a great video of the collapse at the BBC site, which did not allow sharing.  Click here to view it.

NASA has some shots also.  Here is what things looked like on July 8.

After the melting this is what it looked like on July 12.

Keep it quiet

Apparently, conditions in Afganistan's national military hospital were atrocious in 2010 and may still be.  Military men told a Congressional hearing earlier this week, "There were open vats of blood draining out of soldiers' wounds, there was feces on the floor. There were many family members taking care of their loved ones. The family members were emptying these vats of blood to help their patients out."  This is not new.  Last year the Wall Street Journal reported that at the same hospital Afghan soldiers often died from neglect or lack of food as some Afghan doctors and nurses demanded bribes for food.

For some reason, Lieutenant General William Caldwell, who headed the training mission in Afghanistan which oversaw the hospital, did not seem interested although he was aware of the conditions.  One of his subordinates, Col. Mark Fassl, asked for an investigation by the inspector general. Caldwell told him to withdraw the request.  Fassl said that Caldwell asked,  "How could we do this or make this request with an election coming? He calls me Bill." There is speculation that "he" in the last sentence was President Barack Obama.

Did people continue to suffer because of an election?

Tuesday, July 24, 2012

12,000 - 11

The first number - 12,000 - is the number of firearm-related deaths in the U.S. in 2008.  In Japan for that year the number was 11.  Why the gap?  Japan has very strict gun control laws.  Maybe we should look at other countries and how they control the use of guns.

Repealing Obamacare does not make sense

That's what the Congressional Budget Office (CBO) says.  They say that repealing the law would increase our budget deficit over the 2013-2022 period by $109 billion. This is the result of net savings from eliminating the insurance coverage provisions being more than offset by the combination of other spending increases and revenue reductions.

However, there would be savings between $10 and $30 billion from the IRS and Health & Human Services.

There are social costs of repeal, about 30 million fewer nonelderly people would have health insurance in 2022 than under current law, leaving a total of about 60 million non-elderly people uninsured.  Further, after 2022 deficits would increase.

A spelling error

We would not be having these arguments about gun control if the author of the second amendment of the Constitution could spell. He could not distinguish between an animal and whether or not one was clothed. He was told that the amendment gave us the right to bare arms, he spelled bare incorrectly.

More NSA Stuff

Three former NSA employees who have been defined as whistleblowers give us warnings about our security in the 21st century. 

Monday, July 23, 2012

Is Iraq heating up?

The insurgents were on the move today.  They made at least 40 separate attacks in about a third of the provinces.  There were different types of attacks - setting off car bombs, storming a military base, attacking policemen in their homes and ambushing checkpoints, the Iraqi authorities said.  They killed at least 10 and wounded more than 300.

Sunday, July 22, 2012

Quotes from Neil Barofsky

He was the Inspector General for TARP.  These quotes are from an interview with Gretchen Morgenson.
  • “The suspicions that the system is rigged in favor of the largest banks and their elites, so they play by their own set of rules to the disfavor of the taxpayers who funded their bailout, are true,” Mr. Barofsky said in an interview last week. “It really happened. These suspicions are valid.”  
  • “Treasury had failed to ensure that the servicers had the necessary infrastructure to support a massive mortgage modification program.” It barely got off the ground, and few homeowners have received the help they hoped for. 
  • “There has to be wide-scale acknowledgment that regulatory capture exists, dominates our system and needs to be eradicated,”
  • “We need to re-educate our regulators that it’s O.K. to be adversarial, that it’s not going to hurt your career advancement to be more skeptical and more challenging,” he said. “It’s implicit in so much of the regulatory structure that if you don’t make too many waves there will be a job for you elsewhere. So we have to limit those job opportunities and develop a more professional path for regulators as a career. That way, they won’t always have that siren call of Wall Street.” 
  • “So much of what’s wrong with Dodd-Frank is it trusts the regulators to be completely immune to the corrupting influences of the banks,” he said in the interview. “That’s so unrealistic. Congress has to take a meat cleaver to these banks and not trust regulators to do the job with a scalpel.”  
  • “Incentives are baked into the system to take advantage of it for short-term profit,” he said. “The incentives are to cheat, and cheating is profitable because there are no consequences.” 

Alaska shows the way?

I don't usually read editorials but today I read one in the NY Times.  It was quite striking in that it told the story of a health care organization that is actually achieving better results at lower costs.  The organization is the Southcentral Foundation in Anchorage.  Its performance is so outstanding that health care personnel from around the world recently met there for a conference.

The Foundation is an offshoot of - and still financed in part by - the federal government's Indian Health Service.  It serves 45,000 enrollees in the Anchorage area and 10,000 more scattered in remote villages, most reachable only by air, on an annual budget of $200 million.

Here are some of the numbers.
  • Emergency room use has been reduced by 50 percent, hospital admissions by 53 percent, specialty care visits by 65 percent and visits to primary care doctors by 36 percent. These efficiencies, in turn, have clearly saved money. Between 2004 and 2009, Southcentral’s annual per-capita spending on hospital services grew by a tiny 7 percent and its spending on primary care, which picked up the slack, by 30 percent, still well below the 40 percent increase posted in a national index issued by the Medical Group Management Association. 
  • Patients are virtually guaranteed a doctor’s appointment on the day they request it, and their calls are answered quickly, usually within 30 seconds. 
  • The percentage of children receiving high-quality care for asthma has soared from 35 percent to 85 percent, the percentage of infants receiving needed immunizations by age 2 has risen above 90 percent, 
  • the percentage of diabetics with blood sugar under control ranks in the top 10 percentile of a standard national benchmark, and customer and employee satisfaction rates top 90 percent. 

These numbers have been achieved using the following:
  • Assigning small teams — consisting of a doctor, a nurse, and various medical, behavioral and administrative assistants — to be responsible for groups of 1,400 or so patients. The team members sit in the same small work area and communicate easily.
  • Integrating a wide range of data to measure medical and financial performance. Southcentral’s “data mall” coughs up easily understood graphics showing how well doctors and the teams they lead are doing to improve health outcomes and cut costs compared with their colleagues, their past performance and national benchmarks, and it provides them with action lists of what they can do to improve and mentors to guide them.  
  • Focusing on the needs and convenience of the patients rather than of the institution or the providers.
  • Building trust and long-term relationships between the patients and providers.
  • Changing from a reactive system in which a sick patient seeks medical care to a proactive system that reaches out to patients through special events, written and broadcast communications, and telephone calls to keep them healthy or at least out of the hospital and clinics.

Saturday, July 21, 2012

Speaking up for free speech

I've been impressed with McClatchy newspapers since I started writing this blog.  Now they are one of the few - if not the only - newspaper not willing to cede a censorship role to the government when it comes to quoting the subjects of interviews.   Other newspaper have given government sources the right to clear and alter quotes as a prerequisite to granting an interview.  McClatchy says no.

Obama is silent on this ad

There is something I am not getting about this ad.  It features Stephanie Cutter, Obama's Deputy Campaign Manager.  It was made in conjunction with Second City.  I had never heard of Ms Cutter, but it looks as though she is who she says she is.  She is characterized as a Democratic Party operative by Wikipedia and has worked with Clinton, Ted Kennedy, Kerry and Obama.  I have heard of Second City.  It has been producing  very good and well-known comedians since 1959.

This ad is not funny or relevant.  It is an embarassment to Obama and Second City.  As to what it says about Ms Cutter, I'll leave that to you.

Friday, July 20, 2012

Some mistakes are more serious than others

ProPublica is working on a series about hospital mistakes.  But the Rory Staunton experience has prompted a fairly lengthy article about the problem.  Staunton is the kid who died from septic shock after being sent home by NYU's Langone Medical Center.  The Center has announced changes they are making to prevent such a problem in the future.  The authors of the article, who claim to have extensive reporting experience in the area, don't think that the changes will be fully implemented.

As part of their evidence they cite the fact that a national panel concluded more than a decade ago that nearly 100,000 people die each year as a result of errors in hospitals.  They also relate repeated mistakes that have occurred in three hospitals in the recent past.  Rhode Island Hospital, affiliated with Brown University, has been fined three times for operating on the wrong side of a patient's head.  Nurses at Martin Luther King Jr./Drew Medical Center, a now closed public hospital near Los Angeles, couldn't get its nurses to properly monitor heart patients. In a clinic in Las Vegas nurses reused syringes.

The writers believe it's the hospital culture that is primarily responsible for these errors.

Thursday, July 19, 2012

States are in trouble

The report of the State Budget Crisis Task Force is out and things look pretty bad. We're getting older.  We have yet to rein in health costs. The federal payments to the states will likely decrease.  Pensions have been underfunded. Cities and towns are struggling. State accounting systems stink.

The Task Force, which is made up of some heavy hitters of both major parties, doesn't think the problems will be solved when, if ever, the economy comes back. Here are its recommendations and conclusions.
  • The public needs transparent, accountable state government finances.
  • States should strengthen and make better use of their main tool for counter-cyclical policy, their rainy day funds.
  • Few state governments have effective procedures for monitoring the fiscal condition of their local governments in a timely manner or taking early action to help local governments resolve their fiscal problems before they threaten insolvency or bankruptcy.
  • Essential state and local infrastructure is starved of funding and necessary maintenance.
  • Federal deficit reduction and budget balancing actions pose serious potential threats to
    state and local government economies and budgets.
  • Pension systems and states need to account clearly for the risks they assume and more fully disclose the potential shortfalls they face.
  • State tax bases have eroded and become more volatile; these developments are undermining fiscal sustainability
  • Federal and state governments should work together to control health care costs and
    Medicaid costs.
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Wednesday, July 18, 2012

Who turned out the lights?

The power industry.  

You may have noticed that you're reading about blackouts more often. In the past 20 years the number of major power outages (system failures not due to weather or fires) has more than doubled in the U.S.  In an average year, outages total 92 minutes per year in the Midwest and 214 minutes in the Northeast. Japan, by contrast, averages only 4 minutes of interrupted service each year.  Needless to say, blackouts cost money, between $80 billion and $188 billion from the U.S. economy every year.  

This is due, by and large, to the power industry's unwillingness to invest in the grid.  Starting in 1995, the amortization and depreciation rate has exceeded utility construction expenditures. In other words, for the past 15 years, utilities have harvested more than they have planted. 

How long do we keep the lights on, roads passable, bridges safe, etc. without investing in our infrastructure?

Wonders of the Sea

Stranger things have happened

I was sent the following video by a long-time quite conservative friend. Frankly, I was shocked by it as, although it is an ad for a tv show and is somewhat over the top, it does express many of my views as to the condition of this country today and how far we have moved from our glory days. 

Tuesday, July 17, 2012

The money launderer - HSBC - and the helper - OCC

That's the conclusion of the Senate Permanent Subcommittee on Investigations.  And, the Subcommittee accuses the Office of the Comptroller of the Currency (OCC) of just sitting by while the law was being broken. Here is what the subcommittee found:
(1) Longstanding Severe AML (Anti Money Laundering) Deficiencies. The bank didn't react when it was alerted to possible problems, didn't really assess risk and, in general, were willing accomplices.
(2) Circumventing OFAC Prohibitions. The bank allowed two affiliates to get around prohibitions on Iranian finances.
(3) Disregarding Terrorist Links. 
(4) Clearing Suspicious Bulk Travelers Cheques. The bank cleared sequentially numbered, illegibly signed, bulk U.S. dollar travelers cheques for Hokuriku Bank, which could not explain why its clients were regularly depositing up to $500,000 or more per day in U.S. dollar travelers cheques obtained in Russia into Japanese accounts.
(5) Offering Bearer Share Accounts. Over the course of a decade, HBUS opened
over 2,000high risk bearer share corporate accounts with inadequate AML controls.
(6) Allowing AML Problems to Fester. The OCC did very little to stop HSBC.  There were a few minor fines, some stiff talks but nothing more.

Name a country in Latin America...

...and our military is there either directly or via funding of bases that can host our troops. Aruba, Curaçao, Chile, Colombia, El Salvador, Peru, Belize, Guatemala, Honduras, Nicaragua, Panama, Costa Rica, Ecuador - we have a military asset there.  We even reactivated the Fourth Fleet, inactive since 1950, to patrol the region.

In total, the U.S. military has some form of troop presence in approximately 150 foreign countries, not to mention 11 aircraft carrier task forces -- essentially floating bases -- and a significant, and growing, military presence in space. The United States currently spends an estimated $250 billion annually maintaining bases and troops overseas. 

Sunday, July 15, 2012

This is my candidate

Is our next president one of these fellows?

Nothing is secret anymore

The FDA was worried that proprietary information of those submitting applications for FDA approval was being released by some of the FDA scientists, specifically five scientists who had questioned the approval of medical imaging devices that the scientists believed exposed the patients to unduly high levels of radiation.  So, the agency decided to monitor the e-mails of those five scientists, who used government computers both at work and at home.  

This monitoring took place despite the fact that the Office of Special Counsel, which deals with the grievances of government workers, found that the scientists’ medical claims were valid enough to warrant a full investigation into what it termed “a substantial and specific danger to public safety.”  Furthermore, the FDA's Inspector General had ruled that “matters of public safety” can legally be released to the news media.  Finally, regulations specifically protect such information as attorney-client communications, whistle-blower complaints to Congress and workplace grievances filed with the government.  The monitored e-mails contained just this kind of information.

Another example for Winston Smith to ponder.

An alternative

Obama and Romney are not the only names you will find on your ballot in November.  Most of the other names you will have never heard of.  But there is one name that I have heard of - Jill Stein.  I know the name from her running for governor in Massachusetts, where I once lived.  I suspect you will know her name as November comes closer.

Stein is the candidate of the Green Party.  Okay, the party is a little far out.  But, she has qualified for federal matching funds, probably the only no-name candidate who has.  The party is on the ballot in 21 states now and should be on the ballot in at least 45 states come November.  It has peanuts to spend: $1,000,000.  But it could be a spoiler in some battleground states.

Of course, Stein supports the usual green positions on the environment.  However, she also realizes that we are in a financial crisis and supports such efforts as reinstatement of  Glass-Steagall, real regulation of Wall Street and a major change in the tax code. 

A major difference between Stein and the primary candidates is that she believes in what she says.  To me that's important in an election where once more we have two primary candidates who believe only in being elected, despite the fact they have performed poorly in the electoral roles they have held.  I'm tired of voting for the lesser of two evils.

A plague of grasshoppers

Grasshoppers are moving across Texas eating up gardens, pastures and landscapes of every sort.  One farmer says the grasshoppers will “get on everything. They’ll eat black-eyed peas, tomatoes and peaches. They’ll strip sweet potatoes down to the ground. They’re not prejudiced; they’ll tear into everything.”

 The plague is the result of last year's drought plus the hot and dry summer. Being born in a fallow area simply means the grasshoppers move to a fertile area and eat their way through that area.

Read more here: http://www.mcclatchydc.com/2012/07/13/156125/attack-of-the-grasshoppers-in.html#storylink=cpy

Read more here: http://www.mcclatchydc.com/2012/07/13/156125/attack-of-the-grasshoppers-in.html#storylink=cpy

Read more here: http://www.mcclatchydc.com/2012/07/13/156125/attack-of-the-grasshoppers-in.html#storylink=cpy

Saturday, July 14, 2012

Controlling the banks

Martin Wolf summarizes what can be done to begin exerting control over the banks.  There is nothing new in his list, but you can feel his rage as you read his article.  He's proposing:
We live in a real world and crimes will occur not matter what we do
Really penalize the perpetrators
Reduce leverage significantly
Better evaluation of risk
Make sure there is a very large margin of safety
Reinstate Glass-Stegall
 What reasonable person can quarrel with Wolf  on his proposals?

Law enforcement is not alone in watching you

Earlier this week I commented on the number of times law enforcement agencies request information from cell phone companies. However, law enforcement agencies are not the only people interested in us.  Much more interested in us are vendors.  By knowing more about us they hope to sell more to us.  For example, through our cell phones vendors can learn what we buy, where and when we buy it, how much money we have in the bank, whom we text and e-mail, what Web sites we visit, how and where we travel, what time we go to sleep and wake up, and a host of our other activities.

I wonder how much money cell phone companies earn by selling information.  I also wonder what Winston Smith would have to say about the matter.

Friday, July 13, 2012

Time for some music

Name a country in Africa....

...and the chances are that our military is or will soon be involved there.  Nigeria, Libya, the Central African Republic, Congo, South Sudan, Mali, Somalia, Yemen, Kenya, Uganda, Ethiopia, Djibouti, Mauritania, Burundi, Chad, Tunisia, Algeria, Morocco, Cameroon, Gabon, Botswana, South Africa, Lesotho, Senegal - we're involved with all these countries.  In most cases we're 'training' their troops. But we are also using them for drone attacks, surveillance, special ops and who knows what else.  We're improving airports so that our cargo planes can land.  And, none of this is free.  

But as our AFRICOM Commander General says, “The absolute imperative for the United States military [is] to protect America, Americans, and American interests; in our case, in my case, [to] protect us from threats that may emerge from the African continent.” 

I'll sleep well tonight.

Walt on Israel

Five years ago Stephen Walt and John Mearsheimer published “The Israel Lobby and U.S. Foreign Policy”.  The book was met with charges of being anti-Israel.  I thought that the book described our relationship with Israel quite well.  Walt has not forgotten about Israel, but his blog does not focus there; it is truly a foreign policy blog.  However, his latest entry, "What's going on in Israel", is quite pessimistic about conditions - primarily the settlements - there today.  

Walt believes that Israel is not interested in a two-state solution and rather than go to war with Palestine it is using a policy of "separation" to ensure that two states never become reality.  Walt quotes a columnist for Ha'aretz (emphases mine):
To exercise control over the land without giving up its Jewish identity, Israel has embraced various policies of "separation." It has separate legal systems for traditional Israeli territory and for the territory it occupies; it divides those who reside in occupied lands based on ethnic identity; it has retained control over occupied lands but evaded responsibility for the people living there; and it has created a conceptual distinction between its democratic principles and its actual practices in the occupied territories. These separations have allowed Israel to manage the occupation for forty-five years while maintaining its identity and international status. No other state in the twenty-first century has been able to get away with this, but it works for Israel, which has little incentive to change it.
True, these are simply one man's opinions and Ha'aretz is a liberal newspaper.  But, these are serious charges which, to me, have the ring of truth.

Walt's conclusion as to how it effects us:
America's standing in the region and in the world is inevitably tarnished as long as Israel persists on the course described in the articles cited above. This situation forces U.S. leaders to adopt contorted and hypocritical positions on human rights, non-proliferation, democracy promotion, and the legitimacy of military force. It makes U.S. leaders look impotent whenever they repeatedly term Israel's actions "regrettable" or an "obstacle to peace" but then do nothing about them. It forces politicians of both parties to devote an inordinate amount of attention to one small country, to the neglect of many others. Worst of all, U.S. policy ends up undermining the reasonable people in Israel and the Arab world -- including moderate Palestinians -- those who are genuinely interested in a peaceful solution and to coexistence among the peoples of the region. Instead, we unwittingly aid the various extremists who gain power from the prolonged stalemate and the sowing of hatred. This bipartisan practice may not be the most dysfunctional policy in the history of U.S. foreign policy, but it's got to be damned close.

Thursday, July 12, 2012

Sanctions at the Local Level

Apple has decided to apply sanctions against Iranians who want to buy an Apple product in an Apple store in America.  These Iranians may have been born here or there, the item may be intended for use here or in Iran.  It matters not.  If you speak Persian in the store or let the sales clerk know you are Iranian, you will not be able to buy anything in an Apple store.

This is not an easy position to take as, in doing so, Apple is violating the customer's civil rights in that he is being refused something because of his being Iranian.

Wednesday, July 11, 2012

The National Reconnaissance Office

Every few months McClatchy publishes a "Special Report", a series of articles about an important issue, such as Mexico, Bin Laden's killing, etc.  It looks like they have started a report about the National Reconnaissance Office (NRO), an office I had never heard of.

The NRO is another of our spy agencies.  With its annual budget of $15 billion it manages our satellites so that "when the United States needs eyes and ears in critical places where no human can reach – be it over the most rugged terrain or through the most hostile territory – it turns to the NRO".  The report is not about the the success or failure of the NRO.  It is about the office's interviewing of job applicants and employees.  

The office is rightly concerned with spies who are seeking to get inside the office.  One technique it uses to prevent such infiltration is polygraphy.  The office was given strict rules about the use of polygraphy, what can be asked, what cannot be asked.  McClatchy's work seems to indicate that these rules are being broken quite often in that considerable information is being obtained about people's private lives.  In fact, it looks as though the office is encouraging this rule-breaking by giving bonuses to those who obtain private information.  

It is not clear as to the use the office makes of this personal information, although it is stored in a database.  When someone confesses to having committed a crime, the office does not notify the police.

Read more here: http://www.mcclatchydc.com/2012/07/10/155587/national-reconnaissance-office.html#storylink=cpy

Tuesday, July 10, 2012

Marketing Hype

ProPublica thinks that the New York City Police Department has used hype to exaggerate its record with regard to terrorist plots.  The department claims it has thwarted or helped thwart 14 terrorist plots against New York since Sept 11.  ProPublica has looked at these 14 plots and concluded that (a) there were far fewer than 14 serious, developed plots and (b) the department has overstated its role in stopping attacks.

Of the 14 plots, ProPublica concludes that maybe three were real cases where the NY police did something.  The police were really stretching it with the other 11; there were cases in which government informants played a significant or dominant role, cases whose credibility or seriousness has been questioned by law enforcement officials and cases in which an idea for a plot was abandoned or not pursued beyond discussion. 

I agree with Gen. McChrystal

At the Aspen Ideas Festival, McChrystal said, “I think if a nation goes to war, every town, every city needs to be at risk. You make that decision and everybody has skin in the game.” Tom Ricks has some ideas as to how a different kind of draft might work.  In some ways he would reinstate the WPA as some of the draftees would perform non-military tasks.  Ricks thinks that this "new draft that maintains the size and the quality of the current all-volunteer force, saves the government money through civilian national service and frees professional soldiers from performing menial tasks would appeal to many constituencies".

His plan would provide three options for high school graduates:
  1. Serve 18 months doing basically menial tasks that are currently outsourced: paperwork, painting barracks, mowing lawns, driving generals around, etc. Pay would be low but benefits (including free college tuition) great.
  2. Perform civilian national services like teaching in low-income areas, cleaning parks, rebuilding crumbling infrastructure, or aiding the elderly for two years.  Again low pay, but good benefits.
  3. Decline to serve in any capacity but pledge to take no government aid such as Medicare, subsidized college loans and mortgage guarantees.

Monday, July 09, 2012

Another Privacy Issue

Cell phones are ubiquitous, therefore it's only natural to assume that they are used by criminals.  So, law enforcement agencies often request cell phone companies to supply messages, locations and other information about the companies' subscribers.  "Often" last year meant 1,300,000 times.  In most cases the agencies have followed the law.  However, the law is such that the companies are obligated to provide information if the law enforcement agency deems the request an emergency.

This is another area where questions of privacy can be answered in more than one way as there are really no standards that the companies can follow.

Killing #1 in Honduras

The DEA killed a supposed drug smuggler in Honduras last week.  Agents shot at a pilot who “ignored orders to surrender and was shot after making a threatening gesture.”  This is the second shooting, but first killing, by a DEA agent working in Honduras to protect us from the War on Drugs.

What would be our reaction if the situation were reversed?

Sunday, July 08, 2012

Comments re Libor Scandal

Martin Wolf of the Financial Times and formerly a member of the UK’s Independent Banking Commission:
My interpretation of the Libor scandal is the obvious one: banks, as presently constituted and managed, cannot be trusted to perform any publicly important function, against the perceived interests of their staff. Today’s banks represent the incarnation of profit-seeking behaviour taken to its logical limits, in which the only question asked by senior staff is not what is their duty or their responsibility, but what can they get away with.
As my colleague John Kay, has frequently point out, such behaviour, which might seem to be the logical consequence of profit-maximisation, is incompatible with the survival of a sophisticated market economy. Without trust in the probity of those one deals with a host of potentially profitable long-term arrangements will collapse. This is particularly true in banking, Trust is not an optional extra in banking, it is, as the salience of the word “credit” to this industry implies, of the essence.
Dennis Kelleher of Better Markets:
So this isn't about Libor - this is about Lie-More
That seems to be the business model for the big global finance houses.  They like to call themselves "banks," but they aren't banks in any traditional sense.  They are global behemoths that are not just too-big-to-fail, but also too-big-to-regulate and too-big-to-manage.  Take JP Morgan Chase for example.  It has a $2.35 trillion balance sheet, more than 270,000 employees worldwide, thousands of legal entities, 554 subsidiaries and, as proved by the recent trading losses in London, a CEO, CFO and management team that has no idea what is going on in their own bank. 
Let's hope for the sake of the global financial system, the global economy and taxpayers worldwide that Mr. Diamond's resignation is the first of many.  What is needed is a clean sweep of the executive offices of these too-big-to-fail banks, which are still being governed by the same business model as before the crisis:  do whatever they can get away with to get the biggest paychecks as possible.  (Remember, CEO Diamond paid himself 20 million pounds last year and was the UK banking leader insisting that everyone stop picking on the banks.)
Lie-more is just the latest example of why that all has to change and the sooner the better.
 Mervyn King, governor of the Bank of England, “the idea that my word is my Libor is dead.”

Nouriel Roubini: Nobody has gone to jail since the financial crisis. The banks, they do things that are illegal and at best they slap on them a fine.  If some people end up in jail, maybe that will teach a lesson to somebody.  Or somebody hanging in the streets."

Hat tip to Baseline Scenario.

Another Liberal Questioning Obamacare

Wendell Potter was an insurance company flack for twenty years.  He sees Obamacare as leading to big profits for the insurance companies, particularly if they can get rid of some of the consumer-friendly provisions.  He analyzes many of the talking points they insurance companies are using.  An interesting article.

Be Safe or Sorry?

John Hanrahan has a concern or two (hundred) about the increasing war against our democratic rights in the name of security.  Here is a short excerpt from a very long article.
(We can) Wage secret wars and semi-covertly unleash cyber attacks and drone strikes in any country against any putative enemies – as defined by the Obama administration – and don’t worry about international and national legal niceties or congressional approval, much less having open, public debate about our overt and covert war-making? Fine, as long as you keep us safe and don’t tell us about the civilian casualties we and our NATO allies cause or the number of new enemies we create through our military adventurism – unless, of course, those civilian casualties are caused by governments in Libya or Syria or the like. After all, we are the United States, the world’s greatest democracy, and the rules don’t apply to us.

If I were a foreign correspondent coming to the United States, what would I see? A two-plus-centuries old democracy where over the course of little more than one decade first one president and then his successor have assumed or been granted awesome powers for the government to assassinate citizens and non-citizens alike who are deemed to be dangerous to the state – anywhere in the world, merely on the say-so of the president that these are dangerous individuals; to detain individuals indefinitely without trial; to conduct warrantless surveillance of individuals; to subject persons accused of crimes against the state to trial by a military tribunal rather than before a civilian court; to bring some defendants deemed to be particularly dangerous to proceedings before secret tribunals; to arrest and hold indefinitely without charge not only suspected terrorist enemies of the state but any person deemed, without trial, to be giving ill-defined “material support” to such enemies; to remand prisoners to custody in other countries whose governments are known for torture policies; to set up secret prisons for terrorist suspects in other countries; to invade and occupy and bomb other countries that pose no direct or imminent threat to his own nation; to wage secret wars using elite military units, without open consultation with the legislative branch or the citizenry; to unleash armed drone strikes and assassinations in any country felt to be harboring dangerous enemies of the state, with or without authorization of the leaders of those countries, and with or without knowledge of specific terrorists residing in those countries; to bring espionage –espionage! – charges in record numbers against government whistleblowers, accusing them of disclosing information about illegal government spying or government lying about matters of national security and war; to keep one accused whistleblower in solitary confinement, often stripped naked, for eight months, even refusing a United Nations human rights investigator’s request to interview him, and so on. And I would see self-serving, dangerous legal opinions, used first by one president to justify torture, and then by his successor to assassinate via drone or other methods any person deemed by presidential fiat to be a terrorist enemy of the state.

A Liberal Who Doesn't Like Obamacare

I just finished reading Matt Taibbi's "Griftopia", his story about the Great Recession and other financial follies of the 21st century.  I was struck by his willingness to call some of the participants, particularly our leaders, idiots and worse.  Substantively, I was surprised at his view of Obamacare.  After all, he is a liberal and I would have thought in favor of the act. The title of the chapter about Obamacare is "The Trillion-Dollar Band-Aid".  Taibbi's basic argument is that Obamacare is essentially a political deal: the drug and insurance companies get massive subsidies, Obama gets their help in being re-elected.

I think Taibbi was opposed to Obamacare for two reasons.  He claims that the insurance business was exempted from the Sherman Antitrust Act, the Clayton Act and the Federal Trade Commission Act  and, thus, already had an advantage over other businesses.  Hence, "the insurance industry was given a permanent license to steal."   Taibbi is also disenchanted with Obama, primarily for not fulfilling many of his promises - particularly those regarding health reform - made as a candidate. 

Saturday, July 07, 2012

Questioning the NY Times

Edward Shadid, close cousin of famed reporter Anthony Shadid, thinks the Times put Anthony Shadid in unnecessary trouble, trouble which led to his death at the age of 43. This is an excerpt from a speech Edward gave to the American-Arab Anti-Discrimination Committee's annual convention.
Just 11 months after Anthony’s deeply traumatic kidnapping, for which he received no counseling or treatment for possible PTSD, The New York Times insisted that Anthony illegally infiltrate Syria in a poorly planned, dangerously risky operation. His editors overruled Anthony’s objections and failed to provide equipment he had requested. When he then died of what his cousin suspects was a heart attack, the Times put out an inaccurate story that obscured the newspaper’s role in his death, while proclaiming him a hero and basking in the reflected glory.
 Edward asks the media to protect its foreign correspondents.  That's not asking too much.  Is it?

It's not new

ProPublica summarizes the current status of the Libor scandal, whose initial casualty is Barclays. I learned two things from the article.  Barclay traders wanted the rates manipulated to benefit their trades.  This has been going on since 2005. So, it followed in 2007 that lying about the rate could also be useful company-wide as well as for individual traders.

Thursday, July 05, 2012

America 2012

You really should read Tom Englehardt's latest article.  It's titled "The Military Solution".  Here is an excerpt:
Here’s a 2012 American reality then: as a great power, the U.S. has an increasingly limited toolkit, into which it is reaching far more often for ever more similar tools.  The idea that the globe is a chessboard, that Washington is in control of the game, and that each militarized move it makes will have a reasonably predictable result couldn’t be more dangerous.  The evidence of the last decade is clear enough: there is little less predictable or more likely to go awry than the application of military force and militarized solutions, which are cumulatively incendiary in unexpected ways, and in the end threaten to set whole regions on fire.  None of this, however, seems to register in Washington.
The United States is commonly said to be a great power in decline, but the militarization of American policy -- and thinking -- at home and abroad is not.  It has Washington, now a capital of perpetual war, in its grip. 
This process began, post-9/11, with the soaring romanticism of the Bush administration about, as the president put it, the power of the “greatest force for human liberation the world has ever known” (a.k.a. the U.S. military) to change the world.  It was a fundamental conviction of Bush and his top officials that the most powerful military on the planet could bring any state in the Greater Middle East to heel in a “cakewalk.”  
Today, in the wake of two failed wars on the Eurasian continent, a de-romanticized version of that conviction has become the deeply embedded, increasingly humdrum way of life of a militarized Washington.  It will remain so.

Guantanamo is not cheap

There are now 169 detainees at Guantanamo. As we know, these are perhaps the most dangerous people on the planet. We really need 1,700 troops and contractors to guard these criminals.  There are a total of 6,000 people on the base to make sure it runs smoothly. How much does all this cost us?  Just to house and feed the troops costs $47,000,000 (or $280,000 per detainee) a year.   How much do we spend on housing and feeding the other residents on the island?  Compensation costs dwarf whatever that amount is. 

And now we want to spend $40,000,000 to improve communications. Do you see any likely budget cuts here?

You have to follow the rules

Report on Fukushima

Japan Apocalypse _DDC3785
Japan Apocalypse _DDC3785 (Photo credit: Abode of Chaos)
The Fukushima Nuclear Accident Independent Investigation Commission has published its report and it is a blockbuster.  The accident would not have happened if government and the nuclear industry were not good buddies.  Furthermore, the commission chairman said, “What must be admitted, very painfully, is that this was a disaster ‘Made in Japan.’ Its fundamental causes are to be found in the ingrained conventions of Japanese culture: our reflexive obedience; our reluctance to question authority; our devotion to ‘sticking with the program;’ our groupism; and our insularity.” 

The nuclear regulators let Tepco avoid implementing basic security measures, despite the fact that Japan is earthquake-prone.

The commission chair asserted, “It was a profoundly man-made disaster that could and should have been foreseen and prevented. And its effects could have been mitigated by a more effective human response.” Communication - between Tepco and the government, between the government and its citizens - was very poor.  It's likely that most of the damage was caused by the earthquake, not the tsunami as Tepco claimed.

All in all, a damning report.

Wednesday, July 04, 2012

Jail is a better deterrent than money

When will our legal employees start bringing charges that will put corporate criminals in jail?  There have been very few of the criminals responsible for the Great Recession who have been jailed.  We have settled on fining the company.  Why should a corporate leader really worry about the size of his company's fines?  He has made enough money to take it easy for the rest of his life.

Not My Fault, I'm Only The CEO

Like his colleague, Jamie Dimon, Bob Diamond, CEO of Barclays, blamed the this week's banking headline attraction on his underlings,"reprehensible" traders. The Barclays scandal came about because the bank lied when reporting its rates which are part of the Libor (London Interbank Offered Rates). Libor is a key factor in how much interest you and I pay. Who knows how much these "reprehensible" traders - not Mr. Diamond - cost us? Surely, it's more than the $450,000,000 paid in fines last week to the U.S. and England. 

One might say that Diamond as well as the bank's chairman and its COO did the right thing and resigned. There has been no mention of their severance packages. I'm sure they are substantial. 

It also looks as though Barclays is not alone in this rate-fixing. The following banks are also being investigated: Deutsche Bank, Royal Bank of Scotland, Credit Suisse, UBS, Citigroup, JPMorgan and Bank of America.

Monday, July 02, 2012

Syria: July 2012

The NY Times has a series of photos from Syria. This one depicts a funeral procession terminated by an exploding bomb.

U.S. is #1...

...in our interest in who is Tweeting.  Here is Twitter's report for the first six months of the  year.


Outsourcing by the Federal Government

The Project on Government Oversight (POGO) has produced a study of the federal government's use of contractors.  It is a damning report.  Would you believe that the feds contractor work force may be four times as large as its employee workforce?  I use 'may be' because the feds do not have a truly accurate way of counting the number of contractors.  There are a lot of other questions about the use of contractors that cannot be answered with confidence.  We do know, however, that we spend over $320 billion on contractors.  POGO argues that we could save quite a bit by using employees rather than contractors. 

POGO compares the annual compensation of federal workers, private workers and contractors.  I have copied their table of comparisons below.  Yes, the annual compensation of contractors cannot be seen.  However, the first three columns are ratios which indicate the differences between the categories.

These comparisons can be questioned in that some contractors are not employed for a full year.  Yet there are some federal offices which have more contractors than employees.

Like much of government there needs to be a better way of analyzing their operations.

Table 1: Cost Analyses

OPM Series Description Federal
to Private*
to Federal†
to Private‡
Full Federal

Full Private
Annual Billing
Accounting 1.50 2.40 3.60 $124,851  $83,132 $299,374
Auditing 1.47 2.31 3.40 $122,373  $83,132 $283,005
Budget Analysis   .89 2.75 2.43 $110,229 $124,501 $302,661
Building Management .62 2.38 1.48 $111,564 $179,740 $265,242
Cartography 1.47** 1.46 2.14** $116,481 $79,219 $169,520
Cemetery Administration
1.12 2.83 3.17 $106,124 $94,485 $299,832
Claims Assistance and
  .76 4.83 3.66  $57,292  $75,637 $276,598
Computer Engineering 1.04 1.97 2.04 $136,456 $131,415 $268,653
Contracting .98 2.29 2.24 $113,319 $115,596 $259,106
Correctional Officer 2.17 1.15 2.49  $72,977  $33,598  $83,803
Environmental Protection
1.20 1.40 1.68 $127,247 $105,964 $177,570
Equal Opportunity
1.40 2.05 2.87 $125,368  $89,394  $256,381
Facility Operations
.90 1.66 1.50 $108,060 $119,449   $179,254
Financial Analysis 1.24 1.30 1.61 $132,262 $106,679 $171,288
Financial Management 1.13 2.05 2.32 $164,218 $145,486 $337,002
Fire Protection
and Prevention
1.04** 1.25 1.29**  $65,452 $63,105   $81,702
Food Inspection 1.04** 1.29   1.34**   $58,090 $55,883  $74,963
General Attorney .79 3.17 2.51 $175,081 $220,924  $554,923
General Inspection, Investigation,
Enforcement, and Compliance
1.17 1.62 1.90 $104,712  $89,394  $169,666
Groundskeeper 2.00   .80 1.60  $64,896  $32,396  $51,709
Human Resources Management 1.11 2.05 2.27 $111,711 $100,465 $228,488
Information Technology Management 1.09 1.59 1.73 $124,663 $114,818 $198,411
Language Specialist 1.80** 1.92 3.46** $110,014 $61,010 $211,203
Logistics Management [Deployment] .94 1.76 1.66 $116,047 $123,349 $204,443
Logistics Management [Planning] 1.19 1.46 1.74 $116,047 $97,269 $168,938
Management and
Program Analysis
1.15 2.15 2.48 $124,602 $108,132 $268,258
Mechanical Engineering 1.15 1.50 1.72 $126,177 $109,961 $189,197
Medical Records
1.26  .99 1.24  $58,641  $46,705 $57,782
Nurse 1.16 1.65 1.92 $105,714  $91,042  $174,803
Police 1.24 1.34 1.66   $71,256 $57,533  $95,659
Program Management .97 1.56 1.50 $173,551 $179,740 $269,901
Quality Assurance   .94 1.09  1.03  $98,939 $104,891 $107,786
Security Guard 1.53 1.36 2.08  $50,257  $32,953  $68,515
Statistics 1.15 1.66 1.91 $125,192 $108,586 $207,563
Technical Writing
and Editing
1.25 1.08 1.35 $103,801  $82,873  $112,091

Average Cost Premiums