Mittwoch, Januar 27, 2010

This Was To Be Expected...

I saw the first moon landing, of Apollo 11, in Eureka, California.

I remember the last one as well.

And now it appears that President Obama has decided that there are better things to do with the money, and that it's not worth doing.

Or is he?

In the news story - actually, it's probably something somebody said sounded like something good - there is a small glimmer of hope, one that I expect is being used to deflect dismay before, at a later date, the door is closed with a resounding slam: privatization of space.

However, this isn't being done for the reasons stated. Rather, it's being done because the President can't be bothered to make the commitment - never mind funding, the commitment is the key thing (or is it?) - to keep manned space flight up and going in the United States, just as the Russian, Chinese and even Indian space programs start to pick up.

On the one hand, it is a devastating indictment of the lack of vision from a President who ran on being a visionary: abandoning space in order to spend the money "here at home" is extraordinarily short-sighted, catering to that soulless and humorless cohort of the Democratic Party who has always claimed that the entire space program is a waste of money, better spent solving the problems we have here on Earth.

To quote:

...the White House will direct NASA to concentrate on Earth-science projects — principally, researching and monitoring climate change — and on a new technology research and development program ...

This is nothing less than saying "okay, we need space to prove that global warming is happening, but outside of that, we'll pretend to be researching, meaning that outside of a few million spent on that, effectively returning NASA to its earliest days designing airfoils and the like, we wind down the rest of the programs and turn off the lights.

Now, to scandalize my readers, consider this: it's an idea.

NASA has blown it, big time. They blew it with the Shuttle, they've blown it with the Ares follow-on project that should have flown by now, instead of being billions over budget and years late, they've blown it on so many levels that it really isn't funny any more.

As if it ever had been.

Let's take the President at his word, that he will allow private launch services to go commercial and that US needs will be met by these.


Let's shut NASA down. Entirely. All of it. That's $20bn saved. Give $5bn in prize money: $2bn for the first company to put 10 people on the moon for 30 days and bring them back safely; $1bn for the company that puts 1000 kilos into a stable geostationary orbit for less than $100/kilo launch costs with potential for mass-production and later man-rated transport services; $1bn for the company that puts 100 000 kilos into low earth orbit for less than $100/kilo launch costs; the final $1bn is for small-scale prizes for reducing costs and increasing energy efficiency.

Let all those aerospace engineers go. Fire them. They'll either find work with the new companies, or they won't. There is hope that the bureaucracy at NASA can be finally killed off. I'll believe it when I see the stake in the bones as they crumble to powder in the sun.

That's cash, straight, not subject to any taxation or other conditions.

The conditions?

None. Oh, sure, the usual down-range requirements so that no idiot sends up a rocket that lands in the middle of a major city because a $25 gasket failed. Outside of that: zilch. Let the pioneer spirit return, financed by crazy old men with stars in their eyes.

It worked for Heinlein.

And by no conditions, I mean no conditions: no UN saying that we should preserve the moon for all of humanity, hence no commercial exploitation. How many rockets does the UN have? Exactly.

And in the legislation that dissolves NASA, there should be the following clause:

Congress shall pass no law, nor shall any President issue a declaration, limiting or forbidding the commercial use of space, except for such rules developed by the FAA to ensure the orderly commercial exploitation of neath-Earth orbit and beyond.

That should really be a constitutional amendment, but let's not get greedy.

If this doesn't happen, then NASA will be maintained as a retirement home for the US aerospace industry, China, India and Russia will own the high ground, and ... all that money saved will be wasted on government programs that make the problems here on Earth, that "need to be solved", all that much more worse.

The Fix Was In...

Read this to understand the driving force behind the Obama Presidency and the current state of the Democratic Party.

A building was sold in Chicago for $7.7mn despite there being a credible bid for $9mn. The seller? The City of Chicago, which decided to forgo $1.3mn in revenue from the sale. The buyer was/is a big contributor to the Obama Campaign and the person in charge of selling city properties is ... the treasurer of the Obama Victory Fund.

The buyers "invested" $50k in "campaign donations" and saved $1.3mn in purchasing costs. That's a ... 26:1 return on equity.

The losers? The citizens of Chicago, who lost $1.3mn.

Corruption by any other name...

Dienstag, Januar 26, 2010

Gotta Watch This One...

Just One Small Step...

This is brilliant.

It also appears to be working.

Corruption kills social contracts, kills citizen participation, kills representative government, kills progress, kills justice.

It's one small step. Making it patently clear to those taking bribes that they are corrupt is one small step.

Corruption also simply kills: it kills by selling medications from hospitals; it kills by taking money needed for clean water; it kills by diverting money from the public to the private sector.

Corruption isn't limited: it is pervasive when those corrupted can hide and not be called to account.

A Question Best Left Unanswered...

This caught my eye in today's WSJ's Best Of The Web Today from James Taranto.

You'll have scroll down a bit: it's about campaign financing.

The killer quote:

In other words, as a result of the Watergate-era campaign finance restrictions, it is now settled law that congressmen are sufficiently corruptible that they can't be trusted with campaign donations of more than a few thousand dollars.

I dare say that this is a widely-held opinion, given the rate at which those serving in Congress are caught taking bribes, having money that they can't account for (in their freezers to keep it from spoiling, no doubt) and generally behaving like, well, Congresscritters.

Is there a wonder why Congress is held in such contempt? Check the polls about the standing of Congress, and it is surprising that even 10% of people think favorably of Congress. The only institution that can change this is... the American people, by voting the corrupt bastards (and bitches) out of office. Corruption has reached a point where only a moral revolt against the excesses of the 1968 generation can clean the stables, so to speak, of the muck that has accumulated. While I see the Republican sins as sins of venal men, weak and corruptible, I see the Democrats as having dedicated themselves to large-scale sinning, as we've seen with the whole sub-prime crisis, more than happy to have the US taxpayer pick up the bill for Congress' sins.

But what James Taranto says is particularly relevant:

Which raises the question: How can they be trusted with our tax dollars?

The answer, of course: they can't be.

Government in general can never be trusted: that is one of the reasons why the US constitution is such a subversive document. It says that people can criticize the government, that the government can't disarm them, that the government has only those rights explicitly given to them and all other rights belong to the people, not the government.

That is why we have a Republic with a written constitution that requires a lot of work to change. It's the best defense against the tyranny of the majority and the tyranny of a government that has all the rights except those it deigns to grant its citizens.

I've said it before and I'll say it again: the US Constitution is the most subversive document ever published. With it, citizens can deny tyrants and the corrupt from taking over the system, and the system of checks and balances has, as we've recently seen, even worked when only one part of the system refuses to countenance the sins of the other two.

Montag, Januar 25, 2010

Green Imperialism...

This from Cato's web site, but originally from the Economic Times (India).

Those in charge of the IPCC have abysmally failed in their task: to hide inconsistencies in data and theory, to prevent anyone from noticing the man behind the curtain.

Climategate-II is also a sad example of green imperialism. Rather than accept the findings of foreign scientists alone, Jairam Ramesh, India's environment minister, appointed a panel of Indian scientists on Himalayan melting. "My concern is that this comes from western scientists ... it is high time India makes an investment in understanding what is happening in the Himalayan ecosystem."

Basically, the Indian government analyzed what was claimed by the Green Imperialists and found out that it was ... wrong. Not merely a little bit wrong, perhaps a bit too over-zealous in analysis, something that is forgivable and acceptable if you believe in the greater "truth".

But no, instead:

Various green NGOs — including one I respect, the Centre for Science and Environment — backed the IPCC against the Raina Panel. They blindly echoed western scientists with less intimate knowledge of the Himalayas than our own scientists. Stalin would have called this a case of Indian compradors acting as the lackeys of western imperialists, and on this occasion I would find it hard to disagree with him.

These green groups claim to be watchdogs for civil society, and often do a good job. But in this case they blithely allowed a hoax to go unchallenged for two years.

Hence: those whose ideology blinds them to empirical reality are the lackeys, not of western imperialists, but rather of the Green Imperialists.

And what must be the consequences?

Clearly the true climate denier is Pachauri: he swears by glacial apocalypse even after its exposure as a hoax. When the Raina panel produced solid scientific evidence challenging the glacier melting thesis. Pachauri instantly decried it as schoolboy science and said condescendingly that it was not peer-reviewed. Yet he was happily willing to sanctify schoolboy speculation on glacial melting, and so were other members of the IPCC. All their high-faulting talk of peer-reviewed science proved to be just a tactic to keep out inconvenient views. IPCC scientists responsible for this fiasco must resign. The 2007 IPCC report must be amended, preferably with an apology.

The likelihood that Pachauri, the man in charge of the IPCC, who has politically corrupted the entire IPCC with his actions, would actually do the right thing and resign, is about as likely as Ceausescu, the Romanian dictator, admitting that he had made mistakes and would turn over the government in Romania (back then) over to the party, to appoint a successor.

Instead, as Pachauri will also do, he remained until the bitter end, put up against a wall and shot with his wife to put an end to it.

Not that this will happen as such to Pauchari: rather, he will fight to the bitter end and will, at the end of the day when the entire IPCC fraud is exposed and brought to the light of day, continue to deny that he has ever done anything but Speak The Truth.

This has been the greatest problem of the Green movement from day one: the belief - sincere but misplaced - that saving the world is a chiliastic undertaking, an undertaking to bring in a new millennium where the problems of the world are solved and heaven will be ordained upon the Earth.

Just like the chiliastics of the first milllenia, the modern-day preachers of the Green Revolution, romanticists and imperialists alike, cannot abide the light of reason.

Britain, Blair and Bloody-Mindedness...

There is the old saying that every country gets the government it deserves, one way or another.

One must ask, then, what the UK has done to deserve Labour. Or, more exactly what it did to deserve Blair.

But not Tony: in this case, it's Cherie.

While Tony Blair is to be admired for a number of his actions, his wife ...

Well, simply read this.

Ye gods.

The idea that the wife of a former head of state would take on a case that is aimed at forcing that state to pay for actions taken 50 years ago is ... mind-boggling.

Words fail me: let us put this in perspective, if we can.

For the American reader: this would be as if Hillary Clinton, instead of becoming Secretary of State, had decided, instead, to file suit against the United States of America for treaty violations against native Americans.

While this would be a nice fantasy for the left - finally, one of their own speaking "truth" to power! - it would be, effectively, a direct attack on the country that her husband had served - regardless of what one might think of his Presidency, President Clinton did that - and to which they were, in their own (and sometimes convoluted) ways, and are, dedicated. Politics (should: the Democrats have had problems with this) ends at the water's edge: there is no honor in serving those who would damage the country, and justice, if that is what is sought, is not served by having the President's wife take up the call for a foreign power. This is, in the realm of American politics, simply inconceivable. Period.

But not, apparently, for Ms. Blair:

The barrister wife of former British prime minister Tony Blair will represent a group of Australian Aborigines suing the British government over nuclear testing on their land, a report said Saturday.

Aboriginal Legal Rights Movement spokesman Neil Gillespie said Cherie Blair had been engaged by a group from Emu Field, in Australia's red desert centre, who are seeking compensation over 1953 atomic tests by Britain.

Five cases had been lodged in the British courts over illnesses allegedly linked to the fallout from two nuclear weapons exploded in the Great Victoria Desert in October 1953.

The thing is: these were addressed by the courts in the past (1985, 1993), and the only thing the folks involved are really looking for is simply more money.

For the wife of the former leader of the country to take on foreign interests - and these are foreign interests - and to sue the government that her husband, at one point, led, is ... indicative of the mind-set, I fear, that dominates the Labour movement in the UK.

Which means that the idea of politicians owing loyalty to King and Country is as outmoded as working to earn a living. Rather, it's pandering to your internationalist base, much like preferring to live off the dole rather than work an unskilled job.

What ever has happened to Great Britain?

Montag, Januar 18, 2010

Further Data Points For The Trend XVI...

Three stories today, from the WSJ...

First this.

I can understand a rationale that says banks should pay into reserves to cover bail-out costs, especially if the US government (=US taxpayer) continues to stand behind the banks to ensure that those too big do not indeed fail. I disagree with the idea that this should be anything but a voluntary act.

But the link points to what is, in my opinion, sheer stupidity: rather than use the fees for the purpose claimed, the money is going to be used to bail out Fannie Mae and Freddie Mac when their continued lending to refinance subprime lending comes home to roost. In other words, the government reaction to the massive losses of politically motivated lending programs is ... toss more money at them. The difference? This time it's the banks that have to pay for this. This is nothing less than robbery: they are taking profits from other banks to pay for the losses of the banks the US government owns and has told to continue to throw away good money after bad.

As the WSJ puts it:

In other words, the White House wants to tax more capital away from profit-making banks to offset the intentional losses that the politicians have ordered up at Fan and Fred. The bank tax revenue will flow directly into the Treasury to be spent on whatever immediate cause Congress favors. Come the next "systemic risk" bailout, taxpayers will still be on the hook. "Responsibility" is not the word that comes to mind here.

The tax will apply to liabilities that are not already insured by government, so the White House is saying it will deter excessive risk-taking. And it does at least tilt at the role of excessive debt in creating systemic risk. But the heart of the moral hazard for the biggest banks is the implicit government guarantee that they will never be allowed to fail, and the tax does nothing about this.

The tax will be levied on financial companies with more than $50 billion in assets. However, as a too-big-to-fail litmus test, $50 billion can't possibly be the right answer. America has just run the experiment by putting a company bigger than $50 billion—CIT Group—through bankruptcy. By any objective reckoning, there were no systemic consequences. The new $50 billion tax threshold thus increases the scope of future bailouts by drawing a wider circle around firms that can gamble with implicit federal backing.

Emphasis was in the original.

It doesn't deter risk-taking: rather, it makes it more expensive. That won't deter it, but will instead push risk-taking into activity that is more and more riskier, since lower-risk is being taxed. If it works as advertised - which it won't - then it would seriously push banks into taking no risk whatsoever in order to avoid paying the tax (woops, they call it a fee...but a tax by any other name is still a tax...).

The second is here.

How are they going to pay for the $60bn gift to the unions? By including capital gains when calculating the Medicare tax of 2.9% on payroll income.

This is party politics at its very worst: those being exempted are the Democratic base. This means that this is probably the biggest political pay-off ever, and it stinks to high heaven. The goal is not to improve anything but the standing of unions: join one and your tax situation improves dramatically.

This administration will go down in history as the administration most corrupted by special interests than any other in history, Tammany Hall included (and that's saying a lot).

The third is here.

Government in the United States currently consumes 23% of total GDP. This is up from 18% in 2000. Do we get more and better government for our money?

No: almost per definition, government activity does not bring as much value to the country per dollar spent than private activity. This is not to belittle government workers: I know some and they're not bad folk goofing off all the time. But when a colleague of mine went into government work as an economist, he started putting in long hours to learn his job as quickly and efficiently as possible. After several months, they pulled him aside and asked him if he need some additional training, if he was having a hard time doing the job? His jaw dropped.

The reason for the question? He had been putting in 50-60 hour weeks to get up to speed and you're not supposed to work more than 80 hours over two weeks, maximum. He dialed back his hours and it took longer to get up to speed, but that is exactly how the system works.

I can understand this for lower-level workers to avoid abuse - and there are those in the government who would abuse them in order to show how good slave-drivers they are, but we are talking about a professional position here.

Governments aren't there to turn a profit, they aren't there to do things private companies do better (well, that's the theory, anyway: reality is a tad different...). Governments should be handling organization and control of activities deemed necessary to be controlled, such as licensing drivers and companies, but not in the business of providing a soft and cushy safety net or paying well over commercial prices for services and goods because of political connections.

The real problem in California?

The government there has less to do with services than servicing politicians:

The resistance comes from the blob of interest groups, inside and outside government, that like California's public sector just fine the way it is and see reform as a threat to their comfortable, lucrative arrangements. It turns out, for example, that all the pointless boards and commissions are bulletproof because they provide golden parachutes to politicians turned out of the state legislature by California's strict term limits. In the middle of the state's most recent budget crisis, State Senator Tony Strickland proposed a bill to eliminate salaries paid to members of boards and commissions who, despite holding fewer than two formal hearings or official meetings per month, had received annual compensation in excess of $100,000. The bill died in committee.

That sort of compensation is what board members see for large private corporations: they're the ones doing oversight on how a company is developing and growing, changing to meet new conditions, etc. Such folks earn their money by giving needed feedback on corporate policies, and usually do so very well because of their decades of experience of running large-scale companies.

This? Nothing more than corruption.

This extends further than just direct payments: when government workers game the system so that they are the winners, regardless of anything else happening:

California government workers retiring at age 55 received larger pensions than their counterparts in any other state (leaving aside the many states where retirement as early as 55 isn't even possible). The California Foundation for Fiscal Responsibility periodically posts a list of retired city managers, state administrators, public university deans, and police chiefs who receive pensions of at least $100,000 per year. The latest report shows 5,115 lucky members in this six-figure club. The state's annual bill for polishing their gold watches is $610 million.

Retire at 55? Ye gods.

California taxpayers are not to be envied. It's not so much the high taxes: it's the knowledge that in the larger view of things, it's money that is being spent on something so corrupted that it's impossible to reform.

California would move only slightly closer to regaining fiscal health if it scraped the gilding off the pensions and health benefits of its most lucratively retired employees. But when even a flagrant example of a government's serving its workforce better than its citizens is politically unassailable, it's hard to be hopeful about the mundane reforms needed to change the rest of the economically debilitating public-employee retirement system. The California Performance Review suggested the sensible thing: gradually substituting defined-contribution for defined-benefit pension plans. (According to a report by the Pew Center on the States, just 20 percent of the nation's private-sector employees are enrolled in a defined-benefit pension plan, compared with 90 percent of public-sector employees.) To no one's shock, the state legislature has rejected all proposals to curb the state's financial obligations to its retired and retiring employees.

As I said: ye gods.

The article contrasts this with Texas thus:

If California doesn't want to be Texas, it must find a way to be a better California. The easy thing about being Texas is that the government has a great deal of control over the part of its package deal that attracts consumer-voters—it must merely keep taxes low. California, on the other hand, must deliver on the high benefits promised in its sales pitch. It won't be enough for its state and local governments to spend a lot of money; they have to spend it efficiently and effectively.

The outlook?

For California's governmental-industrial complex, a new liberal administration and Congress in Washington offer plausible hope for a happy Hollywood ending. Federal aid will replace the dollars that California's taxpayers, fed up with the state's lousy benefits and high taxes, refuse to provide. Americans will continue to vote with their feet, either by leaving California or disdaining relocation there, but their votes won't matter, at least in the short term. Under the coming bailout, the new 49ers—Americans in the other 49 states, that is—will be extended the privilege of paying California's taxes. At least they won't have to put up with its public services.

This is indeed the only hope for California.

But it is the last thing that California taxpayers need. We don't all need to become California.

Freitag, Januar 15, 2010

Par For The Course...

This is fairly clear how President Obama sees the world, or, more exactly, how he sees people earning high levels of money because they are skilled and in demand in the market place (as opposed to being politically connected, which is the proper way in Chicago Politics).

Fundamentally, and this is increasingly a constant when President Obama looks at any sort of industrial policy dealing with sectors that have high wage costs, he wants to control wages.

In the health sector, his policies are clearly aimed, in the name of "getting costs under control," of ensuring that this also means clear and definite controls over what people are paid.

You see, in the Obama world, the only people worth paying lots of money for are ... political operatives in the system.

He wants doctors, nurses and other specialists' salaries to be capped and controlled. Can't have doctors out there making hundreds of thousands of dollars off the poor, helpless patients that so desperately need health care! It wouldn't be fair!

He wants bank employees, basically, to be reduced to the level of bank tellers and clerks making a modest living, not the financial specialists who routinely create value out of getting supply and demand together for mutual benefit...

When anyone starts talking about someone not being worth their wages, unless that person is the one paying those wages, then it's the rhetoric of envy.

What happens next? Probably caps on professional athlete's salaries for the same reason.

The real problem that President Obama's plan is that he is punishing people for having made poor decisions without even contemplating why they made those decisions.

Banks don't operate in a vacuum: they work within a system whose parameters are laws governing their behavior. They react to incentives and disincentives within the market place, and as banks help demand meet supply. It really is that simple.

What drove the banks to make these wrong decisions wasn't greed (banks usually avoid decisions where they can lose serious money unless the returns are high enough and they are willing to take on the risk) but rather because the government, through the laws of the land and economic policy, pushed them to do so. Sure, no one held a gun to their head and said: "Make loans to people who can't afford them". They didn't have to, since exactly this behavior was government policy.

I can't repeat this enough, because apparently no one is recognizing this: without subprime loans, there would be no subprime crisis. That is where the blame lies.

Instead, they are acting like bosses who punish subordinates because they did exactly what they were told, but what they were told to do turned out to be a really stupid idea.

Par for the course, par for the course. This administration is increasingly turning out to be so fundamentally ignorant of how the world really works that the damage that can be done is enormous.

Punishing those who did as they were told for the failures of the policy is also appallingly bad form.

Again, par for the course...

Dienstag, Januar 12, 2010

Greece, the EU, Fraud and Consequences...

In the run-up to the creation of the EMU, Greece apparently cooked its books completely. It claimed to have met the Maastricht criteria - with government deficits no more than 3% of GDP, amongst other criteria - and the EU believed the Greek statistical office.

More here and here. And this in German, but behind the FAZ paywall...

Recent "revisions" show that this was not the case, and indeed Greece met the Maastricht criteria for only a single year, instead of permanently reducing its government spending, measured as a percentage of GDP.

The specific sins of Greece: public hospitals were so severely in debt that the revision of their debt made up a full percentage of GDP; government finances were not reported correctly because revenue shortfalls, higher social costs and much higher government wages were not reported; government corporations were assumed to have much larger operating funds; military expenditures were falsely reported; one-time payments were booked as recurring revenues; swaps were depreciated incorrectly; government interest rate payments were booked incorrectly; state guarantees for loans were not booked correctly; government pension reserves were valued well above their value; regional and local government debt was ignored; non-budget government spending was not included; EU transfer payments were incorrectly reported; and, to top everything, the inability to check individual entries for single item bookings.


This is, bluntly, fraud: Greece defrauded its way into the EMU. They lied - and apparently the statistical office was complacent, compromised and unable to speak truth to power - and weaseled their way into the dreamland of EMU subsidies and support. They trade a pathetically weak currency for the Euro. That comedy of errors, omissions and the like

What will happen?

Nothing. A few heads might roll (meaning that they'll retire with pensions), but nothing serious will happen to Greece for this fraud.

The only real effect that this will have is that no one will trust Greece to do anything other than lie when asked about statistics.

The consequences? None. The EMU cannot afford to have Greece unceremoniously tossed out on its ear (which it so richly deserves: Greece in its current form lives off the EU and is an active drag), and pure formally the EMU has no process to do such a thing.

Hence: business as usual, the Greeks will slowly let the statistics show the true misery of that parasite economy, as it will ensure EU subsidies to get government spending there under control. Can't have the Greeks actually have to be miserable for the complete and total failure of any of their administrations to get this sort of corruption and incompetence under control.

Hence the EU taxpayer, that beast of infinite burden, will pay for Greece's fraud and lies. About par for the EU, that. Never find and punish the guilty when fraud, incompetence and outright corruption makes up the basis for political life. That gets it all too close to home...

Montag, Januar 11, 2010

Such Delicious Irony...

I refer to, of course, this.

Some "real" scientists that "belong" to the "true" group of climate scientists - i.e. folks who aren't considered skeptics, who have been peer-published, and who generally are considered part of the so-called consensus - now contradict the "established" science and point out that it's getting colder out there, folks, and will for some time.

In this case, they've identified the Arctic Oscillation as the culprit: this blocks winds at high altitude and forces air coming from the polar regions further south than "normal", which in this case means when the Arctic Oscillation is at its minimum, rather than heading into its maximum, which it appears to be doing now.

The Arctic Oscillation is apparently driven by the Pacific and Atlantic MDO or Multi-Decade Oscillations. These flip the climate from warm to cold and back again every 30 years or so.

One Professor involved gave a forecast: that by 2030 there will be talk of how an ice age is coming (and, implicitly, that we're all doomed, dooooooomed, I tell ya!) right before the oscillation turns around and things start warming again.

Now that's a forecast I can believe in...

The irony is delicious. First we had, in the 1970s, scientists warning of a coming ice age, then the warming alarmists of recent day, and now...

The cycle will continue to repeat until someone smacks down the clowns.