And They Wonder Why No One Trusts Them...

Ever wonder why the EU Constitution was really rejected? Why there were those who were so steadfastly against it?

On the face of it, European unity sounds great. After the two great wars, enough of squabbling that leads to enmity that leads to antagonism that leads to conflict that leads to war.

So what went wrong?

Well, there is this.

After 11 years, the EU may actually have a budget that normal people can understand and actually make sense of.

Right now, vast monies are off-budget and are controlled by bureaucratic whim. The new nobility - the EU bureaucrats - has a grand total of €105 bn to play with.

Of that €105bn, €43.6bn goes for CAP, the Common Agricultural Policy. Of that, 37% cannot currently be audited. In other words, no one really knows what is going on with over €16bn.

No one.

And for the structural measures, i.e. subsidies for structural change, let me quote the report:

...a high incidence of errors of legality and regularity was detected in the Member States' declarations leading to payments by the Commission.

This on €34.2bn...

And this, again quoting directly:

In the case of internal policies (€7.3 billion euro), despite progress made in certain areas, the Court found weaknesses in supervisory and control systems and a material incidence of error in underlying transactions at beneficiary level. It is likely that the risk of errors will persist unless the legal framework is changed so as to simplify cost reimbursement systems and clarify the procedures and instructions governing the different programmes.

In terms of external actions (€4.6 billion euro), the improvements in the Commission's supervisory and control systems have not yet had an impact at implementing organisation level - NGOs, recipient government , international organisations - where a relatively high incidence of errors at the level of payments was detected. This was linked to poor internal controls in these organisations, and underlines the necessity for the Commission to have a comprehensive approach to their supervision, control and audit.

In other words, of around €105bn, ca €80bn is being spent without controls and without supervision.

Which means that the real problem with the EU is institutionalized corruption.
Duh. After all, the EU Commission has already seen one round of mass resignation because of corruption.

That is what is going wrong with the EU: it's not a political question, but more fundamentally a moral one. The politicians who campaigned AGAINST the EU Constitution are probably the last few non-corrupt politicians around. While I'm willing to stipulate that not all politicians are corrupt, directly taking bribes etc., I am also willing to stipulate that the EU, as it currently is organized, acquiesces to institutionalized political corruption for whatever reasons.

What I repeatedly find amazing is that there are no politicians out there who see how they can use this to gain power and political momentum: even worse, there is no popular backlash against corrupt parties and politics.

I guess that's the American in me, expecting that a populace who bears a heavy tax burden would insist on accountability from their politicians.

From what I can see, however, this institutionalized political corruption is so deep and so widespread that no one with a stake in political and economic development can even think of the repercussions from actually making this open and obvious, since it would mean the collapse of western European poltical culture as we know it. The press isn't interested, no political party is interested (they both live off subsidies and corruption), and the populace is numb.

And that is why the EU Constitution failed: there was too little transparency, no promise of actually improving anything, and people, rightfully, saw it as nothing less than a power grab by bureaucrats to make their position unassailable and permanent.

It's tragic: there is so much human potential being fundamentally wasted in the EU. Why go through the effort of higher education and work like crazy to set up your own business or get that great career when it's a lot easier to play along within a corrupt system and live off the fat of the land?

European political culture is thus severely undermined when politics and commerce combine to further each other's aims at the cost of everyone else.


But no one seems to care. And that is the real tragedy of Europe: not the wars of the 20th century, not the demographic problems, not the economic problems. But rather that the body politic is so corrupt and incapable of change that it will require tragedy before anything can change.

A Culture of Deception...

This is a great post by someone who really knows what he is talking about. Edward Jay Epstein is incredibly knowledgeable about how Hollywood really works, down to the secrets of Cheap German Money and its demise.

He refers to the Culture of Deception of Hollywood. Let me step back a moment and lay this out a bit different than Epstein does.

First of all, all movies require suspension of disbelief. What we see up there on the silver screen is a carefully orchestrated illusion, designed ultimately to do one thing and one thing only: to separate you from your money. There's no greater reward for Hollywood people than for people to pay and pay and pay to see the product, and a really good film, let alone a film franchise like Star Wars or Batman, can finance literally hundreds of careers.

All living off the production of illusion.

Now, as Epstein points out brilliantly, Hollywood marketing doesn't simply limit itself to pushing a film. Rather, Hollywood has to create and continue memes of belief that help it sell films. Epstein reports how, for instance, Hollywood pushes the idea of Area 51 and the belief that the government has aliens it is studying in order to sell movies and TV series: Stargate, which I dearly love to watch, is one of the products of this meme. A few seasons ago they simply started talking about Area 51, and they didn't need to explain what they meant. Not one word, which means that this meme is firmly emplaced in the American, if not the World's, psyche as a fixed idea: the government is lying to us about this.

In other words, Hollywood has a vested interest in certain ideas being a fixed part of at least the American experience: a) the Government is controlled by interests that we don't know about and who do not have our interests at heart; b) you can't trust the government; c) the government is willing to do evil.

Of course, the real problem is that while you can certainly make the case that people in the US know better than to believe Hollywood, since they experience local government as not corrupt and local politicians as people who are out there trying to do a good job, as well as the massive holes in logic and reality that most Hollywood films show that requires a suspension of disbelief in order to remain believable, this isn't necessarily the case for foreigners watching the films.

A suspension of disbelief means that you as spectator know full well that Godzilla can't move the way he does because in reality, he'd need legs five times the size that he has just to stand, let alone move. It means that you accept that a general declares martial law and suspends habeaus corpus, even though you know that he'd be relieved of duty within a few minutes and that no officer would execute his orders, knowing that they are unlawful. It means that you accept soldiers behaving like automatons, carrying obviously illegal orders out, although you know that US soldiers are highly trained to act on their own and to question and refuse unlawful orders.

But someone in Germany or Austria might well not know that. No, let me put it more bluntly: someone in Tunisia won't know that. He or she isn't watching the movie with the suspension of disbelief, but rather as reality.

And this is where the problems really begin.


Hollywood, with its culture of deception, isn't merely entertaining us: it is also telling a story overseas that is decieving audiences overseas as to the nature of reality. It is the culture of deception that is helping to create problems, since you get people reacting and acting not to the reality of a situation, but rather their perception of the situation.

More on this when I come up for air from the latest forecasting round...

Not Really Surprising...

This doesn't really surprise me much.

Europeans have been infamous in the past for playing games with import regulations. There was a time when each and every videorecorder imported into France was unpacked, plugged in and then a series of tests were run on it; this all in a small customs office in the middle of France.

The goal is generally to stop imports from coming in without making it really obvious that artificial constraints are being set up. From what I can gather, this is aimed directly at the independent auto importer, invariably someone who imports US cars for auto freaks looking for that special car that simply isn't available via official import channels.

But why US cars in this manner?

It probably boils down to a bureaucrat who has decided that he is going to close what few loopholes are left in import laws (some of these include not paying duty on goods when you move to Europe, as they are used household goods, as well as special import waivers for vintage cars and the like that cannot meet modern safety regulations, but are imported on the basis of their collectability and not directly on their basis of usability as a daily means of transportation.

And re-reading the story, it has to do with the cars imported not meeting "European culture" standards. Oh, and I see now who is behind it: Renaat Landuyt, the Belgian Minister of Mobility.

The Minister of Mobility? Ok, Minister of Mobility and Transport. Still: having a Minister of Mobility in a country that is suffering from a total lack of political mobility is nothing less than...ironic. See this for what happens to people who dare to question the status quo and who dare to be sceptical. Play the game or be banned for life.

This is what the guy looks like. Here is where you can get in touch with him.

And this tells you all you need to know about him: his interest in politics was "awakened" on 11 Sep 1973 when he saw the picture of Allende with a weapon in his hand refusing to surrender.

I wonder if he knows that Allende was in the pay of the KGB at the time and had been for some while?


And looking back once again, it's obvious. We have a political decision that is indefensible if it were to come up under the GATT: a minister deciding, arbitrarily, that a particular kind of car isn't appropriate for his country and simply stopping their imports by putting up all sorts of red tape.

Ignoring international trade agreements. Ignoring consumer demand. Ignoring free trade principles.

But the Europeans are soooo much more enlightened than Americans, you know. Who cares what the people want! We know better. And we don't need to go through any sort of law-making procedure (that get nasty when someone reads them...), and we don't need to get the courts involved either. We, the royal We of European Socialism, simply decide that it is so, and it is so.

I think Belgian chocolate is about the best in the world. But that's the last time I eat Belgian chocolate until this changes.

A Modest Proposal

Germany, as we all know, is in the doldrums and has been for the last several years.

A modest proposal, based on this.

Germany's problem is the tax burden: the real return on investments is, after taxes, too small. This is not only true for companies, but for private households as well. If I get taxed at the highest marginal rate, any significant increase in my pay is eaten largely up by taxes, reducing my marginal inclination to invest more time and energy to move ahead in a job or with a company. After reaching a certain level of income, the returns on further investment of time are too small for them to be worthwhile, since leisure time, always at a premium, can't be banked for future periods.

Germany recently gave up an excellent macroeconomic tool: the investment tax credit, since recent code had been so poorly written that instead of German investors getting a tax break by investing in German films, they got a tax break by investing in films anywhere. Instead of getting a tax write-off for ships built in Germany, they got one for ships built anywhere. Given the high cost of manufacturing in Germany, there wasn't much surprise when people realized they could just as easily invest in ships built in China as those made in Germany and get quite a better return on their investment as a result. At the end of the day, the investment tax credit ended up making things worse rather than better, since fund initiators provided relatively elegant and simple investment tools for an investor looking for an easy way to get some tax relief fast.

So investment tax credits were virtually eliminated and in at least one case led to the bankruptcy of closed fund initiators who didn't think that the law would change so drastically and were caught overextended and underfunded.

So here is the modest proposal: reinstate the investment tax credit and have a government team of economists make the decision where these indirect subsidies should go. Not to support aging and dying industries, but rather to open up new ones: how about an investment tax credit for Nanotechnology funds where an investor gets to write off 150% of his investment in the first year for any sum over €25 0000? The subsidy for €25 000 invested would be, at the top marginal rate, something like €15 000, which at first sounds like a lousy deal for the government. But limit these investments to closed funds, where the capital is not fungible for at least 10 years, ensuring that an investor can't yank his money out quickly, and the net effect should be positive, based on income tax from new jobs, corporate tax from new companies and tax income on dividends paid over time. Make it a requirement to have a clear and clean entry and exit for an average investor, and you've created an investment instrument that allows the government to decide which areas it wants private investors to finance, rather than direct government money.

Make this council of economists permanent with 11 members, 1 of whom makes the decision at the end of the day, with a rotating membership of 3 years, with 3 government economists, 3 private industry economists, 3 institutional economists and 2 foreign, non German-born economists. Investment recommendation by majority only, with a "White Book of Industrial Development" published every three years that covers a) success stories and why and b) failure and why. The chairman, who makes the decisions at the end of the day, may not be a government economist. The only allowable investment instrument is closed funds, 10 years with clear entry and exit procedures (i.e. at the end of 10 years, investors know how much they should be getting back, ceteris paribus), and no secondary markets. Investment tax credit of between 100% and no upper limit in the first year, providing investors with a massive incentive to invest. But at the same time these funds are limited to the areas chosen and there must be an approved business plan for the fund that shows a real return on capital over time, at the very latest 10 years. No black box here, but rather business plans that fit into a standardized template for comparability. Limit funds to total subscription of no more than €1000 mn, minimum of €10 000 entry, no single investor with more than 30% of total funds equity.

And eliminate all other subsidies. If companies want to gain access to this kind of long-term risk capital, then they have to enter into competition with new technologies and new ideas in order to get access too this kind of money.

Is It Something In The Water????

I came across this today.

Is there something in the water in Canada?

Or do they all watch Stargate and think it's reality? That that is where McGyver ended up? After all, they talk about Area 51 on that show as well...

On the other hand, the guy was defense minister under Trudeau, and that, I think, pretty much explains it all.

If he keeps it up, he will probably be made an honorary member of the Democratic Party, Moonbat division, and will be rejuvenated as a reward for his efforts when the aliens land.


Seriously: this is also what happens when people are willing to believe anything because they don't really believe in anything.

And another victory, as it were, for sophistry...

And Yet Another Perception Into Perceptions...

See what I mean by the perceptions abroad being critical?

This bit over at PowerLine is exactly on the money, but they need to follow on through.

This is the key quote:

Our enemies gambled that the American people are soft and are not fully committed to the war against terror. They thought that the American people don't have the patience or the understanding of the stakes involved required to take casualties, especially over a prolonged period of time. They believed that if they simply remained active in Iraq, even at a low level, domestic American politics would, before long, swing against the war.

What if their perception wasn't the result of wishful thinking on their part, but rather was clearly supported by the sort of hysterical squabbling that we've seen over the last several years? I can well imagine someone like Saddam Hussein thinking "They'll never invade when a million people march against the idea and the polls are against them: after all, all the President of the US does is to watch polls."

In other words, by deliberate fostering of the appearance of massive dissent (when in reality it's not really serious dissent, but rather was rather ineffectual and in many cases not very serious), the anti-war people emboldened dictators abroad in taking a hard line position that led to war instead of helping to defuse the situation.

To be fair, the above link finishes the quoted paragraph with:

The awful possibility, which seems more likely with every passing day, is that the terrorists correctly judged the American people.

I'd re-word that.

The awful possibility, which seems more likely with every passing day, is that the terrorists correctly judged what the left wanted them to think about the American people. The problem is that the Left was the party of appeasement and apology, and knew not the American people.Thus the collapse of the Democratic party in the elections of 2006 and 2008.

I think that is the more likely outcome.

The Problem with Chavez...

Yesterday's post points out how problematic private diplomacy can be.

Today's link points out why being buddies with Chavez is not really a very good idea.

He's financing revolution in Ecuador, Bolivia, Peru, Chile, Argentina, Dominican Republic and Columbia. He's Castro with money and more years to live, spreading chaos and destruction in the name of justice and social equality, achieving neither and ultimately enriching himself at the cost of millions of people who will die if his ideas become reality. After all, his favorite politcian, after Castro, is Mao.

History repeating itself is farce. But this is farce of the blackest kind, since things are not going to get better for people who believe in his Bolivarist nonsense, but will get much, much worse.

And regarding yesterday's second post: why should the poor and impoverished masses in Venezuala - and indeed they remain so, despite oil wealth, which increasingly disappears into Chavez' pocket - subsidize US home owners living a life of comparative luxury?

But since when did something like that matter to a Kennedy...

And the fun begins...

In the last post I pointed out how Democrats are trying to do an end-run around the US government in dealing with the rest of the world.

In perusing the world, I ran across this and this.

This is exactly what I am talking about.

Chavez is a crypto-communist/neo-fascist thug who has suborned the democratic process in Venezuala in order to gain wealth and pursue his own agenda of political aggrandization and who wants to make things worse in his corner of the world in order to gain power. He vilifies the US and works closely with those who actively work against US interests in the region, and makes no secret of his desire to exert his influence in most of South America.

So who cooperates with him in order to further their own, domestic agenda?

Joseph P. Kennedy II. Democrat
William Delahunt, Democrat
Jose Serrano, Democrat

This is nothing less than political grandstanding, undermining US diplomacy.

And it sets terrible precedence. Not happy with US policy? Go out there and make your own.

No matter if it hurts the interests of the US, as long as it serves your own interests. Who cares about the long-term effects if you can use short-term benefits for your own personal political utility?

This is getting closer and closer to treason than I have ever seen before. There are laws against this.

Specifically the Logan Act, embodied in US Law under the Federal Rules of Criminal Procdure, Title 18, Part I, Chapter 45, paragraph 953:

Any citizen of the United States, wherever he may be, who, without authority of the United States, directly or indirectly commences or carries on any correspondence or intercourse with any foreign government or any officer or agent thereof, with intent to influence the measures or conduct of any foreign government or of any officer or agent thereof, in relation to any disputes or controversies with the United States, or to defeat the measures of the United States, shall be fined under this title or imprisoned not more than three years, or both.

This section shall not abridge the right of a citizen to apply, himself or his agent, to any foreign government or the agents thereof for redress of any injury which he may have sustained from such government or any of its agents or subjects.

The key word here: any correspondence or intercourse with any foreign government ... to defeat the measures of the United States

This means that if you, as a private person, get in touch with a foreign government to try to subvert any sort of US government policy, you are breaking the law. If you get the OK of the US government to do so, then you are not.

Simple, plain, and yet neither Kennedy, Delahunt or Serrano will probably ever be charged with violating the Logan Act.

Why? Because the Logan Act has never been used, for one, although it is the law of the land, and second, no sitting Congressman can be charged with the Logan Act, since it is indeed the right of Congresscritters to have contacts with foreign governments without having to get State Department approval.

But the above links don't show talking: Kennedy, Delahunt and Serrano are actively involved not in talks, but in aiding a foreign government to suborn the policies of the United States.

And that is new.

Some might say: so what? What's the point?

The point is that by allowing private diplomacy of this kind, it encourages other countries to suborn US policy. By thinking they are able to do so, such countries will make serious mistakes in their own policy (convinced, for instance, that "their" people in the US will prevent the US government to act) that may well lead to war.

By accepting subsidized heating oil, Kennedy, Delahunt and Serrano will gain short-term political advantage in their districts. But by doing so in the manner that they have, they will have made the likelihood that Chavez and his people will make the wrong decisions more likely, worsening the political environment in South America.

And by doing so, if this worsening results in violence (either via war, terrorism or externally instigated revolutions), then Kennedy, Delahunt and Serrano will have sacrificed long-term US interestes in political stability and peaceful change for bloody violence in order to get nice polling numbers.

Postscript, added later the same day:

Delahunt has been at this for a while, since 2002:

...he inaugurated a series of unofficial talks aimed at ending the acrimony between the Venezuelan government and the political opposition.

The idea, Delahunt said, was to get conflicting parties into a private, secluded place where they would talk to one another personally and participate in recreational activities together.

The group, which called itself ''Grupo de Boston," met in 2002 and 2003 on Cape Cod. Participants often engaged in heated political talks in the mornings (one session needed an intervention to stop a fistfight).

They also went whale-watching and played intramural baseball in the afternoons, with mixed teams and a bipartisan group of legislators as umpires.

Bottles of Scotch were in the guest rooms, and all had been consumed by the end of the session, a Delahunt spokesman said.

The Grupo de Boston members continue to meet informally in Venezuela, and Álvarez said the initiative has eased tensions.

The issue is a tad clouded because Citgo, providing the oil, is of course a US company, but wholely owned by the Venezualan government; however, the deal was worked out directly by Delahunt, who is now apparently running his own private diplomatic missions without the sanction of the State Department. And acting as an apologist for Chavez and Castro.

Blinders, or How Domestic Squabbles Are Read Abroad...

Haven't been posting much lately due to the fact I'm in the middle of an extended forecasting round for the fourth quarter...and it's a hard forecasting round because of major European economic problems that aren't so much showing up on the usage side of the economy (i.e. consumption and the like), but definitely are becoming apparent on the supply side (i.e. who is adding value to the economic process). I'll make a long story short: things in Europe are much, much worse than anyone in the US really understands. And the converse, of course, is that the US economy, for all its warts and wrinkles, is doing pretty damn good. But enough of that.

This link should tell you everything, if you can understand what is being said. And what is being said is critical: it's the Mayor of Tokyo who is failing to understand what has really been said and is drawing very wrong conclusions that are probably widespread, not so much in Japan but China and elsewhere. He's outspoken and brash in many ways, but he has a multiplier effect above and beyond the Japanese borders. There are a couple of themes going on here before considering an analysis:

First: there is a major asymmetry in infomation between the US and the rest of the world (ROW). Even the more enlightened and internationally oriented folks in the US tend to completely and totally ignore the fact that there are plenty of people overseas who try to follow what goes on in the US with as much interest as they would events in their own country, if not more.

Think of that: when Congress and the President squabble in public, you've got an unprecedented number of people listening who 1) don't understand exactly what is being sqabbled about; 2) don't understand how the US government works; 3) in trying to understand apply local logic and compare with local developments and 4) do this in a foreign language.

That last point shouldn't be ignored: I work day in day out in German, not in English, and even then it's not that easy. When I see my colleagues whose native tongue isn't English make all sorts of interpretation errors because they have a smattering of English, and then think of what the average German knows of English, then the nuances and subtleties of some of the political discourse in the US are completely and totally lost. And that means that you have an increasing number of people who think they understand what is going on in the US and yet no little or nothing of what is actually going on.

Second: very few Americans are aware of this vast and quietly listening group of people. International news in the US, as we all know, is something on page 12 - maybe - or doesn't get into the paper at all, since local events dominate (if any news channel ignores local events, then either they are heavily subsidized or will go bankrupt within a short period of time: people want to know local news before anything else).

Third: traditional American political discourse has always been robust and healthy, but there has been a sea change since the 1980s of demonizing your opponent. Some of this demonization has been appropriate  - Teddy Kennedy doesn't deserve to be in Congress, but should be ending instead his sentence for manslaughter :-) - but the existence of increasing polarization in US civil society has had a strongly negative effect on civil discourse.

Fourth (from a consistent theme in this blog): the distinction between truth and perception is largely lost in the maelstrom of modern communications overload and hyperbole masquerading as fact.

So what do you have?


Increasing levels of misunderstanding, coupled with almost chiliastic commitment to perception rather than truth.

Which means that the effects of poltiical punditry in the US - be it Limbaugh or be it Franken (actually a bad comparison, since Limbaugh is much more of a pundit than Franken can ever hope to be) - is vastly stronger outside of the US than it is inside of it.

So the incessant squabbling of the left about Bush lying - don't get me started on how wrong that is - that is designed for domestic consumption, of rallying the party faithful to work for the election of the unelectable, is having undesired side effects abroad: the message that people abroad are getting is that the US President isn't any better than a local warlord, who has no scruples about lying in order to further his agenda.

And while there are plenty of people in the US who believe this as well, they're wrong. But that's not my point here.

My point is that the hyperbole of the left in the US is causing the poor standing of the US internationally. It's one thing to clean your laundry in public, it's another thing to go hysterical about it.

But the left doesn't care: two Democratic ex-presidents have spoken overseas about how they percieve Bush is doing a bad job. There used to be an unwritten rule that criticism of the US President stopped at the shores. It no longer does. What is worse: it's done in the name of short-term partisan political advantage. It is the end of civil discourse as we have known it.

The Democrats have transitioned from the usual political disagreement to open political hostility that deserves serious analysis (might get around to it one of these days, but it's not something that Democrats would like to hear....). But because of their political blinders, I think the case can be made that excessive spin (spin will never be eliminated, but it really is excessive nowadays) from the Democrats are increasingly read by those abroad as something that it isn't.

The US is increasingly portrayed as a society that is unwilling to sacrifice, unwilling to make a commitment, unwilling to live up to its word. This started with the US Congress' craven abandonment of the Vietnamese in 1974 and continues today: the Democrats are calling for the same kind of craven abandonment that can only damage the standing of the US in international affairs.

And that I can't understand. And that is something that I cannot forgive the Democrats for. Their hysterical internal squabbling with the sitting US President resonates abroad in ways that they can't even imagine, nor would they want if they would bother to understand what they are doing.

Which appears to me to be nothing less than the dismantling of US leadership in world affairs.


One of the reasons that Iraq was invaded, after all, was that Saddam Hussein believed that the US was bluffing when it announced the intention of regime change, if necessary with force. He was convinced, wrongly, that the US wouldn't invade, supported in that belief by US lawmakers going to Iraq on their own and trying to run their own foreign policy. As a result, he didn't comply with the UN resolutions, trusting instead that the whole thing would blow over. After all, all of his visitors were saying, directly and indirectly, that an invasion would never happen.

Having someone go to a crisis area on their own and try to do their own foreign policy (Democrats all) is not merely stupid, it's downright dangerous. It sets up terrible precedents and fosters the belief that the US is divided, incapable of makign decisions and is nothing more than a paper tiger, unable to make true its threats.

It'll be just great if China decides that the US won't risk Los Angeles for Taiwan, or that sinking a US carrier task force would be a price that a US President would be more than willing to make in order to avoid a greater war.

International politics is more about perception than it is about reality: fostering the wrong perception is dangerous, doubly so when the perception being fostered is for short-term political gain. I see too much dismantling of US credibility abroad not by US actions, but by fostered perceptions by those wearing blinders and ignorant of the effects they are having.

This is how my weekend went...

I loved the Batman Begins and am looking forward to getting the DVD. Great movie.

Of course, when I ran across this "quiz", this result would come out...

You scored as Batman, the Dark Knight. As the Dark Knight of Gotham, Batman is a vigilante who deals out his own brand of justice to the criminals and corrupt of the city. He follows his own code and is often misunderstood. He has few friends or allies, but finds comfort in his cause. Batman, the Dark Knight 100% James Bond, Agent 007 96% Neo, the "One" 79% Maximus 79% Lara Croft 75% Indiana Jones 71% Captain Jack Sparrow 63% The Amazing Spider-Man 63% William Wallace 63% The Terminator 50% El Zorro 38% Which Action Hero Would You Be? v. 2.0 created with QuizFarm.com

Actually, I had a great weekend after a very trying week. Spent time with the girls, had a long walk in great weather with my wife, and I didn't do much besides that.

Life resumes tomorrow...

Just a note...

Patience, everyone. :-)

I'm about to leave for a two-day conference, I've got a customer then in the shop for two days, I'm backing up a ridiculous amount of data (close to 750 GB) at home which has eaten up all my time otherwise, and I've been very creative with making sure some data makes sense for another 34 sectors for the Austrian economy.

Hence: posting will be, at best, moderate-to-none for the week. Friday I come up for air and can then tell everyone fascinating tales of the world economy, of nuclear policy and of killer recipes for pork roast...

Now Isn't That Ironic...

Greenpeace decides to go see how badly coral is doing as a result of global warming.

Not only do they find that where they were looking, it's doing fine, but they themselves are then responsible for damaging a coral reef because they ran aground.

But the best part is this:

...Greenpeace divers on the Tubbataha expedition had found that healthy coral and no evidence of bleaching, believed to be caused by warming sea temperatures.

...the healthy state of the Tubbataha Reefs did not disprove the theory of global warming, which he described as an "extremely complicated science."

So let me get this right:

Greenpeace went a'diving as a publicity stunt to show how badly the coral is doing.

The coral is doing fine, with no evidence of global warmth.

And their ship then damages the coral.

And all of a sudden global warming is "extremely complicated science".

Now isn't that ironic.

Sorry, I just couldn't resist...

What Economists Don't Know...

I ran across this (hat tip: Marginal Revolution) today and it reminded me of a conversation I had with the Head of IT at work.

He's not an economist, but works in a building filled with economists and financial people, and is always asking questions to see if there is something we, collectively, don't know.

He asks the questions because he rarely finds a topic that we don't know something about.

But this is a glaring example that even a nobel prize winner in economics doesn't know everything.

Permissive Action Links or PAL don't work the way that Schelling thinks they do. They are not some magic failsafe device that allows turning off all US nuclear weapons via radio, which is what he clearly states here:

U.S. weapons, for example, have "permissive action links"— a radio signal code that arms weapons but that will also automatically disarm them it if launched at an unauthorized target.

Sorry, that's not how it works. That'd be much too dangerous: imagine if an enemy were to gain access to that code, allowing them to disarm US nuclear weapons at will. Bad, bad idea. Really bad idea. There's no way you can't be sure that the code hasn't been compromised, and Basic Cryptography 101 tells you that if you can't be certain that your code isn't compromised, then that code is worthless.

PALs take the form of an interlock that doesn't allow the weapon to be used unless the proper code is input: make one mistake, and you'll need to take it back to the manufacturer for it to be replaced. You can read more here.

Schelling's basic idea is correct: if a rogue nation is making nukes, we should hope that they make them so that if a mob takes over one, they can't detonate without some sort of safeguards. And these kinds of safeguards are what make a stolen nuke from the US or the former SovUnion more or less useless as a nuclear weapon: you have to rebuild them in order to use them, and that is, mildly, a non-trivial task.

But once the weapon is armed, i.e. once the weapon's PAL has been correctly activated, you cannot disarm it. You can't disarm them with a radio code signal: you can tell bombers carrying them to return to base, but that doesn't disarm the weapons. If a missile is fired, then it will, ceteris paribus, be detonated; you can't disarm missiles with a magic code. The same is true for cruise missiles, sea-based missiles and any weapon where a human is no longer in the loop.

Which is why the US continues to have bombers and why bombers would be, in push comes to shove, probably the weapon of choice if you want to maintain positive control over the usage of nuclear weapons until very briefly before detonation.

Which makes Iran's development of missiles that much more disturbing: they apparently aren't concerned about maintaining control, but want to use them.

Or that they really don't understand the world that they appear to want to enter.

Which makes making sure that they don't get them that much more important.

And if anything, we should be sure that India and Pakistan use PALs.

And there is a reason for countries like Iran not to have nuclear weapons: they are irresponsible. For them, nukes are the key to being able to attack Israel with impunity: the Israeli deterrence, even though officially non-existent, does work. Remove that and all bets are off.

And given Iranian rhetoric, don't think they wouldn't be used. For them, it's the whole point of developing them: to destroy Israel first and to prevent the US from retaliating second.

And with nuclear weapons comes great responsibility. That's why none have been used since WW2. That's why the cold war never turned hot. Once you have nuclear weapons, you become a rational player, if and only if you are responsible enough to understand that they can't be used. But give them to a madman, or a religious fanatic desperate for the tool for destruction of a real or imagined enemy, i.e. someone who does not play according to the rules of the game, and all bets are off.

Bernanke and Targets...

Jeffrey Garten in today's FT gave me the impetus to write this. He correctly points out that Bernanke will have not merely the usual challenges in filling Greenspan's shoes - a tough enough challenge as is - but that he's gonna be faced with unknown challenges that will really put pressure on him to perform, but without the decades of experience in financial markets that Greenspan has. And that this is the real challenge for whoever is the Fed chairman.

We've had an enormously effective Chairman of the Fed over the last 18 years. Why has he been so successful?

Two reasons: first, Greenspan understood how the markets work, which is 75% psychology and 25% fundamentals. Second, he clearly states his policies in extremely careful wording to let the markets know what his concerns are, but has never stated any explicit goal.

Why has this been successdul? I think it's mostly the latter reason: never stating an explicit goal. He's never said "inflation should be at n%", he's never said "M2 should grow by n%". He's been criticized for this: lots and lots of people have been severely frustrated because they can't second-guess him. And they haven't been able to second-guess him because Greenspan is deliberately vague about his explicit goals.

Greenspan has been so successful because he doesn't tell everyone what he is doing: he leaves his options open. He's like the CEO of a company that refuses to tell analysts that growth for a company should be 10% for the next year. Telling analysts that you're going to have 10% growth means that you are setting yourself up for a fall when growth comes in at 9.2%: your stock will plummet because it hasn't met analysts' expectations.

And now we are getting a whiz kid who is more than happy to tell people what his goals will be: he will start setting inflation targets.

While this will make plenty of pundits happy, giving them something to write about. But it also means that the Fed will be held accountable for its explicit inflation targets, regardless of the reasons for making them and missing them. And he will miss them.

This is why I'm increasingly mistrustful of explicit targets. The ECB has had them and as a result has been subservient to them, forcing it to take actions that have led to poor economic growth in Europe in order to meet its targets.

And that's the cart driving the horse.

Bernanke will face huge challenges. He's a gifited academic and knows the Fed, having been a member of the board.

But why give up one of the most useful tools in managing the world economy? By being deliberately vague, Greenspan left himself all the tools of his trade open to make the adjustments necessary, but kept the actual process to himself.

This is a good thing: by making the process transparent, you open yourself up to massive punditry, very little of it competent, and you then are captive to the psychology of the market, rather than the other way around. It's a question of priorities: did you make analysts and pundits happy, or do you keep your powder dry and not listen - or at least not too closely - to the kind of speculation that drives the markets today?

Giving in to the latter means that you're giving in to the pressures of the market. And that's a bad idea as well: when markets call for massive increases in liquidity in order to avoid a market correction, for instance, it might make short-term sense to give in, but at significant long-term costs in terms of market expectations. In other words, helping markets avoid a downturn today may well mean that they will take an even greater downturn in 6 months' time, since the imbalances that have led to the downturn will not have been addressed, but rather merely postponed. Even worse, if the market believes that the Fed will behave in a certain manner, then there will be those who will try to leverage financial engineering to take advantage of lags in the market before the Fed can intervene, allowing massive profits at the cost of all players who don't play the same game plan, because the Fed has become predictable.

And that is why inflation targets are an abysmally bad idea.

The Fed needs to be predictable, but leave everyone guessing as to what it exactly plans to do. The decisions of the Fed need to be clear, but not with hard facts: this is the failure of the ECB. It can be predictable, but only in the sense that everyone knows that if the Fed thinks that growth is too low, it will reduce interest rates or adjust reserve requirements or use whatever tools it has too solve the problem.

Explicit inflation targets means that the Fed will have to pander to the markets: it will lose flexibility to proactively take measures.

And worse: the playing field willl be leveled. Now every pundit and wannabe will be able to state their case for believing or not believing what the Fed now explicitly states. That means that you'll have those out there who can claim to be better at guessing how markets and interest rates will move than the Fed, undermining the Fed's believability if the Fed doesn't get everything perfect.

Which it won't.

I don't like the move at all, and I think that Bernanke may well not go down in history as a worthy successor to Greenspan for the reasons enumerated here.

Speechless. Really.

Try and figure this one out: tip of the hat to Austin Bay's Blog.

Bush was and is lambasted for the reference to Nigerian yellowcake.

Based on "bogus" intelligence (the Brits didn't think so, but that's another story entirely).

That was sold to the Italians.

By an Italian businessman, masquerading as a "journalist".

Who now turns out to have been working for the French.

This is the quote:

His admission to investigating magistrates in Rome on Friday apparently confirms suggestions that - by commissioning "Giacomo" to procure and circulate documents - France was responsible for some of the information later used by Britain and the United States to promote the case for war with Iraq.

Italian diplomats have claimed that, by disseminating bogus documents stating that Iraq was trying to buy low-grade "yellowcake" uranium from Niger, France was trying to "set up" Britain and America in the hope that when the mistake was revealed it would undermine the case for war, which it wanted to prevent.
...

Investigators in Rome suspect that Mr Martino was first engaged by the French secret services five years ago, when he was asked to investigate rumours of illicit trafficking in uranium from Niger. He is thought to have then been retained the following year to collect more information. It was then that he is suspected of having assembled a dossier containing both real and bogus documents from Niger, the latter apparently forged by a diplomat.

In September 2002 Tony Blair accused Saddam of seeking "significant quantities" of uranium from an undisclosed African country - in fact, Niger. US President George W Bush made a similar claim in his State of the Union address to Congress four months later, using information supplied by MI6.

The International Atomic Energy Agency expressed doubts over some of the documents' authenticity, however, and declared them false in March 2003.

In July, the White House withdrew the president's claim, admitting that it was based on inaccurate information. British officials still say that their intelligence about Iraqi uranium purchases was supported by a second, independent source.

This is completely, totally, incredibly mind-boggling and underscores how truly bizarre the whole situation is.

This means that the whole Plame controversy is even more bizarre.

I wish I was at a loss for words: the ones I am thinking of right now are not safe for work or mid-sized children, let alone the faint-of-heart.

PS: In looking at this further, I've found that this isn't really all that new: you can see it here, here and here. Doesn't change the import at all, but sheds a different light on a whole lot of events since then. But that doesn't change the fundamentals of the story.

The Worst Possible Protectionism...

Let's be blunt: protectionism is not only a bad idea, it really annoys consumers as well, when they realize that they've been footing the bill for incompetent managers in companies that are better at political lobbying than actually making something.

But this move by the French, hidden as an initiative of the European Commission, really pushes the limit.

Not content to emotionally demonize biotechnology (unless, of course, it's done by French companies), the European Commission want to require disclosure obligations for biotechnology patents. In other words, if you engineer a new bacteria via genetic modification (GM) that, say, combines a gene from a primitive tomato plant in Belize with the gene of a sloth from Madagascar (no idea whether either of these exist) in order to make for a new strain of tomato plants that move really, really slowly, then you need to include the documentation of both genomes in the patent application.

What's wrong with this, you say?

Two things.

First, there will be massive pressures - no, there are massiv pressures - on developing countries from the EU to forbid any connection with biotech products in order not to lose foreign aid from the EU: if a country fails to do this, then the EU has made it clear that it will require genetic testing of any goods from that country to ensure that they aren't "tainted" with genetically modified plants in the interest of keeping the EU "GM free". This will mean not only no development in these countries, but further the probability that if Belize doesn't want you using that tomato plant, then you'll not be able to use it. Or more exactly, Belize will want such high royalty payments for your use of that tomato plant - indigenous to Belize - that you won't be able to make any money on selling the rights for farmers to use that tomato plant.

Second, pushing this means that if you are a Third-World country trying to find a way to produce food to feed your growing population - hey, that's all of them - then you're gonna have a really hard time financing not only the actually biotech work, but more critically the legal framework that will allow you to develop that wandering tomato plant that will deliver perfectly ripe tomatoes to market without having to transport them there (ok, ok: it's just my hypothetical example. The real world examples are actually meaningful and desperately needed).

In other words, unable to convince countries like Brazil, Jordan, South Africa, Egypt and China that GM is the devil seed - unsurprising, given that even the EU admits there is no scientific basis for their ban on GM products - the EU is now trying to hide a virtual ban on further GM development in a move that makes it look like they are "protecting" resources that are being commercially exploited elsewhere. Not that the resources are actually exploited: we're talking industrial production here, not strip-mining natural resources elsewhere (indeed, the industrial production of GM may well mean that the resources elsewhere won't be cut down willy-nilly in order to find those rare Madagascar Sloths (I googled: there is a madagascar lemur sloth), who turn out to be some sort of aphrodisiac when eaten with tomatoes (again, disclaimer: ain't true, it's just my example).

This in and of itself is fairly perfidious: the goal, however, is worse. The EU wants to kill the developing biotech industries in these countries. And not to protect their own GM industry (at least that I could understand), but in order to prevent these countries from finding ways out of their economic traps of low valued added coupled with high population growth rates.

And that is, plain and simple, the worst possible protectionism. What the EU is doing here - sorry, the French - is trying to enforce the right of a Frenchman to buy non-genetically modified food at the cost of continuing poverty and malnutrition in any number of developing countries.

Never mind that there is no scientific proof; never mind the human cost; never mind the lost potential of economic growth in developing countries; never mind the absurdity of it all.

As long as the European obsession with stopping GM - can I repeat that there is no scientific basis for the objection? - is more than willing to not merely accept that millions will be condemned to poverty, but rather actively support that they will remain in poverty, that's how long the further decline of the EU will continue.

Susan Kling Finston wrote the article linked to above. She's with the Institute for Policy Innovation. She's an intellectual property rights expert, from what I can see, and she has, for me, the killer quote:

"...no nationality has a monopoly on good ideas."

Damn right. The problem with the EU is that they think that if they can't have a monopoly on good ideas, no one else is allowed to have any good ideas any more, unless the EU says it's okay to do so.

And that is the worst protectionism ever.

Burn baby burn...

Whilst perusing my daily set of web sites, I came across this.

First this quote:

Although the American soldiers said they were burning the bodies for sanitary reasons (they were starting to rot), the Australian journalist believed that, because there were psychological warfare troops in the area, this was all some kind of ploy to get some nearby Taliban to come out and fight. The media portrayed the incident as an accurate representation of what the Australian journalist thought he was witnessing, and a major defeat for the U.S. in their war on terror. Actually, stuff like this has no impact in the Islamic world. That's because, in the Islamic media, stories like this are invented daily. You can check out the English language sites for media in Islamic countries for examples. Some wild stuff there. The Moslems who hate us won't change their minds because of two burning bodies. Those Moslems who are down on Islamic terrorists won't get very upset about two of them getting torched, even though cremation is frowned upon in the Islamic world (even for Islamic terrorists who burn fellow Moslems to death in the course of their operations, which explains al Qaedas sagging poll numbers.)

The choice of language here is critica: the journalist believed and the media portrayed. In other words, what was reported wasn't facts, but rather opinion. The journalist may well have stated it as his opinion - I don't know - but it's been reported as fact.

Further:

Where this will hurt is in the United States? It will hurt in those parts of the world where there is  is more concern for burned up Taliban than in the Moslem world. That's largely in the Western world, especially among some American politicians and pundits. How will this hurt? Congress can call for more "oversight" of U.S. military operations. The troops are already irked at the lawyers added to some staffs over the last decade. The lawyers are their to veto operations if there is too great a chance that the action will offend someone in the world and, ultimately, someone in Congress. 

Bingo! The whole point of the reporting is to impose impossible restraints that will ultimately kill US soldiers. The US military operates under very specific Rules of Engagement (ROE) that any troop ignores at their peril. Remember the sacking of the US embassy in Pakistan in November of 1979? The Marines guarding the embassy there operated under strict rules of engagement that forbade them from firing on the "protestors" coming in over the wall, and as a result a Marine died. The whole point of military discipline is to control the destruction and mayhem that the military can unleash, and the Rule of Engagement carefully delineate what is allowed and what isn't. What happened in Pakistan indicates a long tradition of being willing to accept friendly losses in order to keep within those rules of engagement: this is, if anything, stronger today than it was back then.

If the bodies were burned as a result of some psychological warfare operation, or just to clean up the battlefield, and the act offended the local Moslems, the troops will pay a higher price than any official investigation (which is already underway) can hand out. The troops have to deal with angry, and heavily armed, people every day. They try real hard to act in their own best interests. That being to avoid getting killed while carrying out their mission. Soldiers sent to Afghanistan go through many hours of cultural sensitivity training. They already know that one misstep can destroy lots of good will, and that in turn means fewer Afghans will pass on useful (often life saving) information, and more will fell inclined to take shot at Americans.

This is also critical to understand: the troops on the ground aren't dumb. This goes against the opinion that many pundits hold about the military, that deciding to pursue a military career is somehow something for people who couldn't do better elsewhere. The reality of the situation is that journalism is a career for people who couldn't do better elsewhere: that's what I remember from when I did my undergraduate degree back in 1979, and from what I can see it hasn't gotten any better.

Apparently, an abundance of combat images served up on TV gave lots of pundits, voters and government officials the illusion they know what's really going on, and should get involved. The fact of the matter is that the U.S. military has been punishing troops for misbehavior since 1776. Yet all this means nothing to those who seek perfection, or simply another way to criticize the way the war is being fought, or the need for a war on terror at all. Any problems with the troops in Afghanistan are a lot closer to home.
 
Now *that* is the money quote: those without any knowledge have the illusion that they know what is really going on, and "getting involved" often means nothing more than trying to gain control over events ex post facto for own glory. If these folks really wanted to know what is going on, then they'd have listened to their briefings, would be better informed, and would have paid more attention. The problem with the troops really is a lot closer to home than any of us think: the problem is not with the troops, the problem is at home.

Then again, this imposes an impossible burden on such pundits: it would mean admitting their own ignorance, recognizing that they aren't the one actually doing something in the world, and more fundamentally recognizing and acknowledging that there are others out there who are leading better lives.

And to clarify things: I haven't served in the US military because I don't pass muster, since I exceed the eyesight limits by a significant margin (I've got -9 and -11 diopters, and this is pre-Lasik: we're talking the late 1980s). Now I'm too old.

Maybe I spoke too soon...

And here I was all optimistic that there might be hope for France yet.

Silly boy.

Of course French farmers are going to screw everything up. Once again...

It'll be interesting to see how the press makes this all Bush's fault...

Subsidies Redux...

If you take a look at the archives, you can see my view on subsidies: that they're largely a bad idea, except perhaps - and this is not certain - for the companies involved.

The Economist, which I used to read all the time but now only rarely, reports on this, which, strictly speaking, isn't about subsidies.

But think of it this way: having government funding of retirement and health care means that the government taxes private individuals and corporations to provide a service to the general public. This is how it works in Europe and Japan, and is part in both countries of the body politic.

But it also means that companies there do not necessarily need to provide these services to their workers. There are some that do, but they tend to be the exceptions.

Here is my thesis: by providing health care and retirement benefits to the general public, governments provide an implicit subsidy to all businesses in that country, since they no longer have to provide those themselves. Take a look at the article: GM and Ford both bear heavy non-business related costs that must be financed on the open market (by sales) that competitors do not face.

Further: this subsidy doesn't really surface in international discussions of such subsidies, since they are implicit and not explicit.

How to solve this competitiveness problem?

Two ways.

1) Import levy on all goods that would cover the cost per unit that US makers have to pay, discounted, for explicit retirement and health benefits. Income from such levies would flow to the companies making the product domestically AND who provide health and retirement benefits for their workers.

2) Eliminate government provision of retirement and health benefits exceeding basic levels (i.e. social security, with its "too little to live, too much to die" payment levels).

The problem with the first is that US consumers pay the bill, traditionally seen as a major hindrance for acceptance. :-)

The problem with the second is that it means major political changes in other countries that can scarcely be palatable to the populations there.

No easy solution here, unless, of course, you want to subsidize US manufacturers. But given the problem with 2) above, hard to see any real alternative.

Which means that US consumers will ultimately pay for GM and Ford to get out of their problems with higher car costs.

Put it down to unintended effects of government intervention in markets, in this case retirement and health care.

Why there is still hope for France...

I've been bashing France here regularly, not so much because I hate France - I don't, and have spent almost a year there over the last 35 years - but because I despise corrupt and incompetent politicians who do unintentionally as much damage to France as they intentionally do it to the US.

But this is why I think there is still hope for France: the simple recognition that the populistic politics that have driven the last several administrations is doomed not only to failure, but will leave France worse off than before.

This, for me, is the key quote:

The spokesman of the Quay of Orsay [French Foreign Ministry] specified that the two lifetime ambassadors had taken part in activities "as private citizens, engaged in after their departure and retirement." But Boidevaix has told the [French] magistrate: "the French administration knew of the existence of my contract" (Le Monde, October 13). This business, hardly dealt with in the media, makes obvious the worst suspicions of Paris' pro-Arabic diplomacy, and came at the expense of our American allies at the time of the Iraqi crisis. Can one really call this honor?

Obviously, it isn't. Recognition that there is a problem is the first step towards correction and reconciliation. And there's no real reason for the US and France to be at odds (and indeed behind the scenes there is significant cooperation), and there is every reason for France to come clean.

Expanding on a theme...

I came across this today and it underscores the last post.

The money quote, for me, is this:

The purpose of the visiting professorships, however, would not be simply to send American academics to Indonesia or to other Muslim countries to teach courses and advise local faculty members on curricula. Instead, just as the American government after World War II dispatched scholars to Europe to help establish university departments and institutes of American studies, so the State Department should define the role of the new professorships as training one or two generations of Indonesian and other Muslim Americanists, who could then transmit what they know about the United States to their own students.

That training should not be devoted merely to developing a cadre of indigenous academic specialists in American subjects. As in the case of postwar Europe, the ultimate objective would be to provide students who will some day enter business, law, politics, or the media with a greater knowledge of and sophistication about America's political and economic system and its cultural traditions.

In other words, it's not enough to toss some money at the problem, but rather you need to make the commitment to change how people outside the US view the US, not as a propaganda instrument, but rather to prevent disinformation becoming perceived reality.

And this is why the left is doing so much damage to the US outside of the US:

And since many Indonesians in my audiences had seen Michael Moore's Bowling for Columbine, they were convinced that students in American high schools were heavily armed, just waiting for the opportunity to open fire.

But it was their questions about Moore himself that left me truly befuddled. I was asked continually if the Bush administration had subsidized Moore's movies, including Fahrenheit 9/11. Eventually I realized that such a question revealed an entirely different set of ideas about the relationship between government and culture. Since Indonesians believed that movies, plays, and novels could scarcely exist without the political and financial support of the state, it was hard for them to imagine the existence of a "private" sector in the arts, or the absence of an American ministry of culture.

In other words, what we in the West accept (that in a free society the free discussion of opposing viewpoints is a good thing, enrichening the body politic) can and is poisonous to those whose society is not that of the West, but rather cannot concieve that someone like Moore cannot be anything but a government spokesman.

This is part of the challenge facing any US government. It is also the curse facing any US government: the left, especially the extreme left, in their blind pursuit of a specific goal - vilifying Bush - have, intentionally or not, vilified not Bush but the United States as a whole.

Deliberate? I'm willing to give some on the left the benefit of the doubt. But not Moore and the looney left with their Bush Derangement Syndrome.

What the left has lost, and lost quite some time ago, was a sense of perspective. Instead, it's agitprop and deceit that ultimatively is destructive. But given basic leftist goals, the destruction of the US is just fine and dandy for them. And you have the spectacle of US elites applauding and cheering people like Moore and his followers and fellow travellers on, ignoring the very real damage that such actions and films cause to US prestige abroad.

But when did that concern them? If anything, they view it as a very real and positive side benefit. Moore would've made a great propagandist in the Soviet Union. I'm not accusing him of being a Communist or some sort of KGB mole: but his very real dedication to deliberately misinforming world opinion about the US makes him  culpable of aiding and abetting the enemies of the US. And by deliberately misinforming I mean the use of hyperbole and the presentation of opinion as fact in order to make his opinions about the US appear to be documented facts, when in reality he has deliberately been frugal with the truth.

It's hard sometimes to reconcile those who abuse free speech with the defense of free speech: however, you have to. But there needs to be more articles like the one cited here that shows what the real costs are of free speech that borders increasingly on hate speech. I'm not a constitutional lawyer, but I do know enough of constitutional law to know that this is one of the trickiest areas to reconcile.

Putting two things together,,,

First I read this. Then I read this.

No connection between the two, you say?

Right.

This is one of my beefs with those who think that cultural relativism is harmless: after all, there's no harm done, right? That people are entitiled to their own opinions is a basic tenet in western civilization. The problem is that there isn't any clear distinction between truth and fiction, between reality and projection. And failing to make this distinction is one of the major challenges facing the coming democratization of the Middle East (and yes, I am convinced that this will happen, despite pundit's doubts and the protests of those with a vested interest in keeping the status quo in place.

Just like those who don't think it's necessary, indeed critical, to counter propaganda. Countering propaganda doesn't mean doing counter-propaganda, but rather of ensuring that the absurdity of the propaganda is shown. This is easier said than done, but needs to be done at the risk of losing the propaganda war. This happened in Vietnam: in the face quote to Col. Summers, General Giap pointed out that they didn't need to win on the battlefield - and indeed they lost every single time it came to battle - since they won the the war by convincing a sizable minority of the US Congress that it wasn't worth the effort.

The problem arises when propaganda is not countered and is accepted by its target audience as being plausible and therefore believeable. This is not limited, of course, to the Nazis, but was a key aspect to Soviet-era disinformation campaigns, such as the one that claimed that AIDS came out of a US bacteriological warfare lab and is being used to depopulate Africa in order to take over the raw materials of that continent.

Don't believe me? Check out both volumes of the Mitrokhin Archives: the documentation of disinformation and the accompanying campaigns are well documented.

Maybe the German government should try to undo what has been done. Rather than encouraging anti-americanism, it should try and undo three generations of bigotry and ignorance by pointing out how absurd anti-semitisim is. Instead, it seems that the priority is not to counter propaganda, but rather to make its dissemination more sophisticated and therefore for the uneducated more plausible.

The US government is bad at propaganda (the echos of derision from the left can be heard from across the ocean...hah!) because, fundamentally, no one in the US can believe that such blatant lies and mistruths can survive the first contact with an educated person. Which is, fundamentally, true: the problem is that propaganda is aimed not at the educated, but rather at the uneducated. When entire states are based on lies, mistruths, invented pasts (apparently the only thing that Mao didn't invent was library paste) and deliberate manipulation of societal taboos, the chance that propaganda won't work is relatively small, since people don't have the chance to develop critical intellectual tools in societies where being critical means you die, are imprisoned and generally are made to be as miserable as possible in order to prevent propaganda from being made ineffective.

And yes, we are in danger of losing the propaganda war: however, there are some serious shifts in the equation. First: the internet makes it possible to quickly research and review; second, the internet makes communication universal, rather than through limited channels; third and finally, the decline in the believability of the MSM, which while accompanied by the growth of blogging does not follow from it, means that critical thought and analysis are probably being made by more people today than has been the case in the last hundred years.

It's just that the critical thought today is not left-wing, but "conservative" thought, which today is anything but conservative.

Raising the Cost...

Ralp Peters has a great article up at the New York Post. Read it here (registration required, but it's fairly painless).

I spent the day yesterday away from the computer, largely. Six hours of sauna is very relaxing.

While there, I started on a book that I've had for a while and simply haven't gotten around to reading: Ghost Wars by Steven Coll. I'm not that far along, but he points out that one of the reasons we supported the Afghan rebels was to make the cost of their adventure in Afghanistan as expensive as possible. Not because we thought that the Soviets would actually be beaten by the Afghan rebels - which were at best a loose coalition and at worst working at cross purposes, with one exception: they all wanted to kill the godless Communists, be it Afghans or Soviet conscripts - but because it made the Soviet occupation of Afghanistan very expensive in terms of material and lives, making it less likely that they would want to try their hand at Pakistan or Iran.

And don't think that wasn't what the Soviets wanted.

But let me get back to my point.

Trying to understand why countries like Iran and Syria are involved in supporting the mayhem in Iraq, I think that Syrian support can be basically attributed to pure bloody-mindedness. The Syrians simply can't be helped in this aspect: they're too deeply emeshed in tribal conflicts and seeking to avoid their own destruction that they don't realize how nicely they are digging their own graves.

But the Iranians are, perhaps, another story. Iran has two sides to its politics: religion and the age-old Iranian claim to local hegemony. The religious aspect is a complex story, with the clergy and their age-old rights to corruption clothed in religious scholarship on the one hand and massive demographic and societal changes on the other hand leading to a situation where the clergy, imagining that they can control their society, are leading slowly and unavoidably to their own destruction. But that's another post entirely.

I don't think many would deny that Iran is heavily involved in southern Iraq, with ties to various groups. But I'm not completely convinced that their involvement is so much the desire to see a religious state emerge in Iraq, since such a state would not necessarily be beholden to the Iranians. I see much more the likelihood that they know their support will not and cannot lead to a islamic state, but rather is oriented towards keeping coalition military assets tied down in a war that cannot be anything but nasty, brutish and bloody (even if largely on the one side: coalition losses have been modest at worst, but the losses on the other side are significant and justify calling the conflict bloody).

Not because they think they can win, but rather to maximize the cost to coalition forces of being in Iraq.

And the more I think of it, the more it appears that this is the real basis for the continuance of the violence and the attempts to make the conflict last as long as possible in the bloodiest way possible.

And how do you defeat such an agenda?

Good question. The only answer I see is to deny the other side any advantage it has in supporting these folks by raising their cost in doing so: by making the case public that they are involved in terrorist killings and by ensuring that they bear an increasing cost in doing so, perhaps not in the same gilt but in other ways.

And the point that Peters makes is that the people paying the cost, the members of the US military, are signing back up in truly record numbers, almost unprecedented. The question that the anti-war people of all persuasion should be asking is what is wrong in their evaluation of the situation if those who are at the most risk are those who repeatedly volunteer to take those risks?

And please: the tired and ancient argument that "they don't know better" or "they can't get other jobs" is so full of holes that it doesn't deserve consideraton, considering that the US job market shows much higher demand than the supply can provide and that the US military is about the best-educated that this nation, if not the world, has ever seen.

John

And Yet Another French Connection...

Well, just when you might think that the French are getting on the same side of the team, it turns out that they're preparing for the future as well.

Who'd of thought that France and Venezuala are now in cahoots?

But I love the quote from Chavez:

French oil giant Total has a strong presence in Venezuela and could double its output from 200,000 to 400,000 barrels a day after several billion dollars were invested, Chavez said in Paris in March.

Now, normally I think this would mean that when Total invests several billion in its oil pumping and refining capacity in Venezuala, capacity could be doubled.

But hey, come on! This is FRANCE we're talking about, the home of indicted former government ministers and a president who can't leave office because when he does, he will be indicted as well. Gotta parse this so: when Total pays off Chavez to the tune of a couple of billion, then Total can double their allocation, no questions asked.

And further:

During the mini summit Chirac reiterated that France and the European Union supported regional integration in Latin America as a "boon for stability and economic and social progress," according to Bonnafont, who said the French president noted Venezuela's recent accession to MERCOSUR, the common market of Argentina, Brazil, Paraguay and Uruguay.

Earlier Wednesday, Chavez lunched with French Prime Minister Dominique de Villepin, who spoke of the "common vision between the two countries."

Villepin added, in an impeccable Spanish he learnt growing up in Caracas, that "relations between France and Venezuela are very good and we are looking to develop our cooperation on all levels."

Great. Villepin grew up in Venezuala? His politics make a whole lot more sense now. The common vision between the two countries is classic anti-americanism, coupled with an intense desire to keep American culture as far away as possible.

Of course, the likelihood of France and Venezuala co-operating more closely was given great impetus in the last few days as Chavez called for his country to go nuclear: of course, France will be more than happy to provide that sort of help. After all, you can see how well France has been involved in non-proliferation by its actions in Iran and North Korea.

With friends like these, who needs enemies?

Facts and Opinions Masquerading As Facts...

The blog North Sea Diaries has the right take on rather strange ranking.

The US rated #44 in press freedoms?

They say:

It reflects the degree of freedom journalists and news organisations enjoy in each country, and the efforts made by the state to respect and ensure respect for this freedom.
...

It includes every kind of violation directly affecting journalists (such as murders, imprisonment, physical attacks and threats) and news media (censorship, confiscation of issues, searches and harassment).

It registers the degree of impunity enjoyed by those responsible for such violations. It also takes account of the legal situation affecting the news media (such as penalties for press offences, the existence of a state monopoly in certain areas and the existence of a regulatory body) and the behaviour of the authorities towards the state-owned news media and the foreign press. It also takes account of the main obstacles to the free flow of information on the Internet.

We have taken account not only of abuses attributable to the state, but also those by armed militias, clandestine organisations or pressure groups that can pose a real threat to press freedom.

Now things become clearer. Obviously, since journalists aren't murdered for their activity, nor are they imprisoned (Miller doesn't count: she went to prison for reasons that no one understands besides Miller), physically attacked and threatened. Censorship, confiscation, searches and harrassment also don't happen as a matter of course. Nor is there any impunity. No legal penalities for press offences (now the Brits, they've got decent libel laws...), no state monopoly, no regulatory bodies (FCC as a regulatory body has to do with ownership, not content!), there is no state-owned media. And there aren't any obstacles on the Internet in the US. No armed militia, no clandestine organizations.

That leaves pressure groups. Oh, the inhumanity!

Woops, I just checked the original: apparently it IS Miller:

The United States (44th) fell more than 20 places, mainly because of the imprisonment of
New York Times reporter Judith Miller and judicial action that is undermining the privacy of
journalistic sources. Federal courts are getting increasingly bold about subpoenaing
journalists and trying to force them to disclose their confidential sources.

Now this is just plain silly. Miller didn't go to jail to protect a brave, confidential whistle-blower (Scooter Libby?): she claims she went to jail for the right to tell any and all judges that she wouldn't talk to them for any reason whatsoever. In other words, that she was above the law.

This is a new interpretation, of course, of the First Amendment: it's not Congress or the courts making the law, it's journalists out there who think that being a journalist means that you are therefore outside of the judicial system entirely. Wrong. You have, according the supreme court, the right not to disclose information about a source: you don't, however, have the right not to talk the court at all. Which is what Miller did and that's why she spent 85 days in jail.

But then again, and this is the original point: it doesn't reflect the degree of freedom, but rather the opinion of those questioned. And there isn't a list of those groups and people posted, but you can take this to the bank: the liberal bias will be as blatant there as it is in the MSM.

And until the link actually tells us the questions and the results, i.e. is itself transparent, then the study is yet another nail into the coffin of press believability.

And did you see that the top 17 countries are small, homogenous European countries? In countries like these, there isn't any need to concern yourself about freedom of the press, since there isn't enough of a base there to support more than one or two newspapers of note, the rest cater to the page 3 crowd of tabloids.

So I guess in order for the US to have a better rating, we'd need to provide complete legal immunity to anyone calling themselves a reporter. Nice work if you can get it.

Cultural Dogmatics

This is one of Lilek's better screeds: the meaninglessness of any government attempt to support dying culture.

We do see some of it the US, however: I think that most, if not all NEA grants fall into this category. It reminds me of a long and rather tedious discussion I had with a German student back when I was studying in Freiburg.

We met by accident one morning when I was enjoying my morning cigarettes and tea (yep, used to smoke. Haven't since 1982, and I'm still losing the weight I gained from stopping smoking) at the local Mensa or student cafeteria. Back then I had a schedule mornings: up at 6 AM, shower, bike down to the cafetaria by 7 and be the only one in the place until around 9 or so. You could get a nice breakfast (pretzel rolls, cheese, tea for DM1.50), and add to that the daily FAZ and the first couple of filterless Roth-Händle (think filterless Camels with a severe attitude), and I was ready then for my econometrics class at 9 or for the library.

One morning one of the guys I knew in Freiburg was showing a batch of new students the ropes. He showed up with them for breakfast, around 15 or so, and he included me in talking about studying and the like. He was a fairly good sloucher and ended up ripping off East Germans after unification, but that's another story. He introduced me as one of the token Americans on the campus, and we talked about some mutual interests, such as Rauhe Mann (a devastatingly good jazz club in Freiburg, long gone, but where you could see some of Germany's best jazz musicians play directly in the crowd. Fantastic.).

One of the girls in the group, a sweet young thing, commented that jazz wasn't really music. My friend looked at me, I looked at him, and we both laughed. I continued to argue with her about this while the rest of the group broke up.

I must have talked with her for at least 2 hours. She came from the "Bach is GOD and Beethoven his disciple" school of "E"-music (E for "Ernst", or serious) and had grown up listening only to them. I grew up in a "the Rolling Stones are GOD and Led Zepplin his disciples" school of "U"-music (U for "Unterhaltung", or entertainment) and while I have my classic phases, they tend to be Ligeti and Bartok, not one of the boring B's (Brahms, Beethoven & Bach). And let's not get into my fetish for King Crimson and Fripp. :-)

To make a long story short, she could not for her life comprehend that jazz has its structures and disciplines, hearing only cacaphony and discord in the music. She was starting to study music and was looking forward to becoming a disciple of harmony and progressions. My friend later asked if we had hit it off, and I said "Not really: she was too dogmatic." His response was to ask whether it was worth talking to her long enough to get her pants off...

What I really want to point out with this anecdote is that if your culture makes a distinction between music that is serious and therefore worthy of intellectual endeavor and music that is merely there to entertain, then your culture is doomed. Music, movies, theater, etc are all aspects of culture: if people want to be entertained, then artists will find their public.

But getting the government involved means that the artists no longer need to find their public, or more exactly, their public becomes art critics who happen to work for the government and can give you money. Which means you get things like Piss Christ and "performance art" funded.

Which brings us back to the screed that Lileks writes so well. You can't stop popular culture from taking the paths that it does, any more than you can stop teenage girls from infatuation and teenage boys from thinking with organs of their body having to do with reproduction. Trying to change this means you're gonna be as successful as any father of a teenager will be: if you haven't given your kids charachter to know right and wrong, it's too late to do so when they're teenagers. Any government that has failed to understand that while you can try to influence culture, you can't make people behave as if they were "cultured", is doomed to waste their money trying to get people interested in Eminem listening to Bach instead.

Posting's been weak lately due to work: lately it resembles Dilbert more and more...

And Cultural Dogmatics sounds like a band that I saw at the Peppermint Lounge in the 1980s...

What the ...?

Ok, let's see if I got this one right.

Miller goes to jail to protect a source. Or, more exactly, she goes to jail for refusing to talk to a grand jury, claiming that to do so would force her to reveal her source.

But that source didn't insist on being protected and was surprised to find out that it was the reason she went to jail.

The newspaper stands behind her, but no one understands what the hell is going on. They don't insist on being filled in, but rather let Miller decide what the paper decides.

Millions are spent on lawyers.

No one understands what the hell is going on.

The source is perplexed. Turns out that he hasn't had any contact with Miller for an entire year, and that Miller interpreted this as the source not wanting to be revealed.

Quote: "I interpreted the silence as, 'Don't testify,' " Ms. Miller said.

And when push comes to shove: "Her paramount concern was how her actions would be viewed by her colleagues."

And it turns out that the source said:

Mr. Libby assured Ms. Miller that he had wanted her to testify about their conversations all along. "I believed a year ago, as now, that testimony by all will benefit all," he wrote.

Now this in itself is just plain weird. But it does become clearer:

On Sept. 29, Ms. Miller was released from jail and whisked by Mr. Sulzberger and Mr. Keller to the Ritz-Carlton Georgetown for a massage, a manicure, a martini and a steak dinner. The next morning, she testified before the grand jury for three hours. Afterward, Ms. Miller declared that her ordeal was a victory for journalists and the public.

She's gonna get a First Amendment Award from the Society of Professional Journalists.


What the ...?

All I see is a grandstanding reporter who knows how to bullshit her editors.

Instead of talking with her source, she goes to jail on an assumption that the source doesn't want her to talk? And never tried to get in touch with him?

I can see this from an immature, insecure 25-year old who want to grandstand, but we're talking about a 57-year old.

Apply Ockham's Razor, I think that what we have here is an immature, insecure 57-year old who grandstanded for reasons apparent only to herself. She's more concerned about how she appears than the truth. Sound familiar? A sophist.

And a New York Times whose editors have abdicated any and every professional responsibility.

It's a real shame. I grew up reading the New York Times. It has fallen a long, long way. And unfortunately, it has yet a ways to go before it might be able to recover. It's sad.