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Zbigniew Brzezinski calls for an exit

Sunday, March 30, 2008

The Washington Post runs against type today and gives some space to Zbigniew Brzezinski, who has opposed the Iraq war from the start.

Nothing he says is much different than you can read, for instance, at Juan Cole’s Informed Comment every day, but it’s important that it appears in the pages of a paper that helped mightily to get us into this quagmire, and has regularly given a platform to those who have been so often wrong about this conflict. Here’s a bit of what Brezinski has to say:

Contrary to Republican claims that our departure will mean calamity, a sensibly conducted disengagement will actually make Iraq more stable over the long term. The impasse in Shiite-Sunni relations is in large part the sour byproduct of the destructive U.S. occupation, which breeds Iraqi dependency even as it shatters Iraqi society. In this context, so highly reminiscent of the British colonial era, the longer we stay in Iraq, the less incentive various contending groups will have to compromise and the more reason simply to sit back. A serious dialogue with the Iraqi leaders about the forthcoming U.S. disengagement would shake them out of their stupor.

Ending the U.S. war effort entails some risks, of course, but they are inescapable at this late date. Parts of Iraq are already self-governing, including Kurdistan, part of the Shiite south and some tribal areas in the Sunni center. U.S. military disengagement will accelerate Iraqi competition to more effectively control their territory, which may produce a phase of intensified inter-Iraqi conflicts. But that hazard is the unavoidable consequence of the prolonged U.S. occupation. The longer it lasts, the more difficult it will be for a viable Iraqi state ever to reemerge.

It is also important to recognize that most of the anti-U.S. insurgency in Iraq has not been inspired by al-Qaeda. Locally based jihadist groups have gained strength only insofar as they have been able to identify themselves with the fight against a hated foreign occupier. As the occupation winds down and Iraqis take responsibility for internal security, al-Qaeda in Iraq will be left more isolated and less able to sustain itself. The end of the occupation will thus be a boon for the war on al-Qaeda, bringing to an end a misguided adventure that not only precipitated the appearance of al-Qaeda in Iraq but also diverted the United States from Afghanistan, where the original al-Qaeda threat grew and still persists.

Speaking of Juan Cole, today he reports that Iran is calling for an end to the violence. He also, again, points out something that is not often mentioned in our stateside reporting, but is widely recognized overseas: the U.S. is backing the Shiite party that is most closely aligned to Iran (see, Axis of Evil):

The Iranian foreign ministry called Saturday for an end to the fighting, saying that it strengthens the US hand in Iraq and may have the consequence of prolonging the US presence. Iran tends to back the Da’wa Party of Iraqi PM Nuri al-Maliki, and the Islamic Supreme Council of Iraq of Abdul Aziz al-Hakim, so it is significant that Tehran is criticizing this push by those two to destroy the Sadr Movement. I take them at their word. They are genuinely afraid that al-Maliki’s poorly conceived campaign will backfire and that Bush will use it to insist on keeping troops in Iraq.

[From Zbigniew Brzezinski calls for an exit]

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Slight sign of spring

Sunday, March 30, 2008

Looks like we’re on track to have one of those Southeastern Connecticut springs, when the weather stays cool until somewhere around the end of May, when it suddenly becomes blazing hot. My wife’s records say we often have daffodils by this point, though not always.

Brook Street 2008-03-3011-20-26 - 2008-03-30 at 11-20-26.jpg

Yesterday I spotted a crocus. Not much, but at least a sign, however slight, that spring is coming.

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Expelled

Friday, March 28, 2008

Regular readers of the excellent blog Pharyngula can stop right here. For the rest of you folks, I must bring you up to date on a controversy brewing in the ongoing wars between scientists and crackpots over evolution. It has been covered extensively at Pharyngula, whose blogmeister, PZ Meyers, world renowned atheist and biologist, was among the many evolutionary scientists who were tricked into being interviewed for a movie, the premises of which was to be, unbeknownst to them, that “scientific” views opposed to evolution were being persecuted. Among other things the scientists were told that the movie was to be called “Crossroads”, when in fact it was to be called “Expelled”, a reference to the alleged expulsion of “creation science” from the garden of academia. Their views were artfully edited for the movie, which was, for reasons unclear, recently premiered in Minneapolis, which happens to be Meyers’ stomping grounds.

Meyers’ obtained an invitation to attend the screening through the film’s website, but was threatened with arrest by the producers, who for some reason were reluctant to let him see the movie in which he appeared. The full story is contained on several recent posts at his blog, which the curious should have no trouble finding. Rather than court arrest, Meyers left, but his guests, who also had passes, were allowed to attend. Unfortunately for the producers, who should really take better care, one of those guests was Richard Dawkins, a more high profile voice of the godless (and also among the duped scientists) than Meyers. His review of the film can be read here.

Of interest is the fact that the film is fronted by Ben Stein, a true 21st century Renaissance man. Ben writes a column for the New York Times, and is billed as a “lawyer, writer, actor and economist”. That’s right, Ben has no talent across a broad range of activities. Given the present state of our culture, in which only those who are consistently wrong are accorded respect, he is a true giant, since he presumes to speak on a wide range of subjects, and is wrong about all of them.

Here he is last September, giving us the word on high about the subprime crisis, which was just breaking into the news at that point:

Yes, there are real problems: housing, mortgage defaults, losses at financial firms, rot in hedge funds. But over all, things will be fine. Unless there is a genuine dollar crisis or a devastating recession (very unlikely), things will work out. This economy is very big and very solid. It cannot be derailed for long by anything we have seen lately.

If I were the editor of the business section for just one day, I would run one immense headline: “Everything Is Going to Be Fine. Go Back to Work.”

Ben is still writing for the Times. About economics. Really.

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Friday Night Music

Friday, March 28, 2008

Okay, I do this with some reluctance, but I am sick of cold weather, and this song, California Dreaming by the Mamas and the Papas, came to mind. I know they are something of a cliche, but the song brings back pleasant memories. I searched in vain for a non-lip synched version, but could find none. There was no attempt, in this video, to even try to match the words with the action. The advantage, I guess, is that the audio is excellent. In looking around I caught a portion of an interview with John Phillips in which he said that they were a studio band, which may explain the lack of a good concert version. Anyway, here they are:

[youtube]http://www.youtube.com/watch?v=-wI6uAOHzvo[/youtube]

Now, I can’t resist reproducing this comment that was on the youtube page where this video is displayed:

im in 6th class and last year we dida play on the sixties and we dressed up as hippies and sang this song it was soo much fun

We are sooo ancient history.

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Mind Boggling

Friday, March 28, 2008

According to MSNBC the nations investment banks are borrowing an average of 32.9 billion dollars a day from the Fed. I think even nowadays that’s a lot of money. The total proposed budget for the state of Connecticut for the fiscal year 2009 is about 18.4 billions, which means that the banks are borrowing a little less that twice Connecticut’s annual budget every day. Other comparisons suggest themselves. The amount borrowed in three days would be enough to fund Hillary Clinton’s health plan for a year. One day would pay for three months of the immoral war. Finally, that kind of money would allow me to get a new computer every day with a new camera thrown in on weekends for the rest of my life, guaranteeing that I would die with the most toys.

Imagine, if you will, that one of our states had created a fiscal mess of the magnitude of that created by these investment bankers. Would the federal government come through with money with no strings attached? (Hint: No). Oh, sure, the banks have to pay the money back, but if they don’t we taxpayers will have no redress, except some overvalued junk assets. If the banks do pay the money back, they will, if the Republicans have anything to say about it, be allowed to go their merry way, with full freedom to wreak havoc through more fiscal chicanery, free of those burdensome regulations which might have prevented the present disaster. Either way, whether the banks re-pay us or not, the executives who led us into this mess will remain filthy rich and reap further ample rewards for their failure, while paying a smaller percentage of their income in taxes than you or me. Oh sure, some of them are suffering. James Cayne, the guy who ran Bear Stearns into the ground, just sold all his Bear Stearns stock, stock that was valued at over a billion dollars just a few weeks ago. The poor guy had to make do with a mere 61.3 million dollars. To put that in perspective, he could probably only afford to buy a new computer every other day for the rest of his life. But before you shed too many tears, remember that’s just what he got for his stock. Who knows what he did with those multi-million dollar bonuses he gave himself every year for crafting the business strategy that got Bear Stearns where it is today. But we can’t fault him, can we? Who could have predicted that lending money to people who can’t afford to re-pay wouldn’t work out?

I freely admit, by the way, that I don’t know precisely how a Fed loan of 32.9 billion is accomplished. Is it the functional equivalent of printing money? I don’t know. But I’m convinced that however it is accomplished, 32.9 billion is a lot of money. The folks who slept while this crisis was brewing must be deathly scared now, since they have abandoned their orthodoxies to bail out these sharks.

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Taming the President

Wednesday, March 26, 2008

I just finished reading the decision in Medellin v. Texas, which is being billed as a defeat in the Supreme Court for George Bush, because the court, the conservative justices in the majority, rejected a Bush bid for expanded presidential powers. Since this is the most political court in our history, I smelled a rat. The court, did indeed, rule against a Bush attempt to assert presidential power, but…not so much that Bush will care.

First, the background. The United States Constitution provides that treaties are the Supreme Law of the Land. I.e, they always trump state laws, at least that’s what it says on the surface. The Vienna Convention, to which the United States subscribes, provides that foreign nationals charged with certain crimes must be informed of their right to consult with consular officials. The United States also was a party to a Protocol by the terms of which it agreed to abide by the decisions of the International Court of Justice (ICJ). Medellin, a Mexican national, committed a murder here in the United States. He was not informed of his rights. The International Court of Justice found the United States to be in violation of its treaty obligations, and in essence ordered a do-over, what we in the legal biz call a remand. Shortly after that decision the U.S. Supreme Court, in a case in which none of the parties to the ICJ case were involved, ruled that the provisions of the Vienna Convention did not overrule state procedural laws. After the ICJ ruled, George Bush ordered state courts to follow the ICJ’s instructions. In other words, he implicitly overruled the Supreme Court. To make sure the problem never cropped up again, he thereafter withdrew this country from the ICJ protocol, but that’s another story.

So, the court was faced with two issues.

First, do the state courts have to follow an ICJ decision. In effect, does the ICJ trump the Supreme Court, which had already ruled, and;

Second, if the state courts ordinarily would not have to follow an ICJ decision, can the president make them do so?

Now, the first of these questions is complicated, so I will admit up front that I’m simplifying somewhat. The court ruled that the courts of the United States don’t have to take instructions from the ICJ, because the treaty does not clearly require them to do so, and Congress has never required it. The decision is laden with signs of petty in-fighting with the dissenters, whose analysis is grossly misrepresented. It is not without its moments, however. I was somewhat amused by the Court’s shock at the fact that, were it required to follow the dictates of the ICJ, such a decision “is not only binding domestic law but is also unassailable”. This from the court that brought us Bush v. Gore.

So in this part of the decision the court was able to do a couple of things that warm the cockles of the conservative heart. It was able to assure the execution of some Mexicans and it was able to subvert international law. It was also able to make sure its own decisions remained unassailable, something designed to warm the cockles of its own heart. It goes without saying that Bush’s solicitor general agreed with the court on this part of the case. The Administration simply argued that if the president wanted to, he could make the law and the courts had to genuflect. Since the Supreme Court has somewhat more institutional self respect than Congress, that was not an argument likely to be warmly received.

In order to get to the presidential power issue, the court had to resolve the first issue the way it did, otherwise the powers issue becomes moot. Once it had done so it had little choice but to rule against Bush. Neither the dissent nor Justice Steven’s concurrence reaches the Bush issue, the dissent pointedly refusing to do so.

Nonetheless, the court does use some strong language about presidential powers, but what does it amount to? First, it hits George Bush where he will be hurt the least. Does he really care if the nation’s courts follow international law? Not likely. More importantly, does this decision have any practical consequences so far as George Bush is concerned? Decidedly not. It is easily distinguishable from the many other situations in which he is trampling on the Constitution and he has less than a year in office, not enough time for any ruling against presidential powers to directly affect him. What the court has done is write brave language that it can choose to apply or not, depending on who wins the next election. For make no mistake about it, the courts will suddenly find that presidential powers barely exist if a Democrat is elected in 2008. On the other hand, should McCain be elected, the brave words in this decision will be quoted only in dissents. Meanwhile, the court gets to look like its taking a principled position against encroaching presidential powers, when the real action is in the evisceration of international law.

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The Land of Stupid Habits

Tuesday, March 25, 2008

In a break with tradition, the Hartford Courant covered hard news on page one today, to wit, an article about a proposal to allow big cities to impose a 1% sales tax. The idea is appallingly stupid for the reasons pointed out by several legislators:

But Republican and some Democratic legislators questioned the idea, saying that retailers would not build shops in those cities and instead would develop stores in surrounding suburbs with lower sales tax rates. In addition, they said that increased sales taxes would disproportionately hurt the poor who would be shopping in the cash-strapped cities.

I would add that car dealers are likely to quickly migrate and that established stores are likely to also move or die. It is amazing to me that one of the cities pushing this is New London, which has such a small geographical area that it takes no time at all to go to Waterford to shop. I would suggest a poll of the downtown New London merchants to see how they feel about being put at yet another competitive disadvantage.

Hartford Mayor Ed Perez didn’t sign on to the full stupid:

Hartford Mayor Eddie Perez did not testify Monday, and DeStefano said that Perez wants the increase only if it is applied statewide. A higher sales tax rate could force shoppers to avoid Hartford and head to Westfarms mall on the West HartfordFarmington line or Buckland Hills mall in Manchester.

On the surface Perez’ position makes more sense, but if you think about it, it is also stupid. First, it would serve to reinforce, rather than dissipate, the present property tax based incentives for towns to salivate over getting big box stores and other blight. They court them now for the property taxes; with this added tax they would stand to gain sales taxes as well. Second, if the taxes were imposed by the towns the money would go disproportionately where it’s not needed: to the very suburbs that have been sucking the life’s blood from the cities for decades. In our area most of the retail development has taken place in Waterford. There is no logical reason why Groton, New London and Montville residents should be paying taxes to Waterford. What would make sense, and will therefore never happen, is the imposition of a statewide increase of 1%, distributed to the towns on a per capita basis. The money would go where it’s needed, at least more so than under Perez’ plan, and towns, particularly the suburbs, would be more likely to prefer that retail development take place elsewhere, since their share of the take would not be dependent on being a host to the disease. That extra money could reduce reliance on property taxes, further curbing enthusiasm for development.

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Overreacting

Monday, March 24, 2008

Things are getting a bit fevered out there:

You know, it strikes me that the best way to really restore sanity and a measure of stability to the mortgage industry is to ensure that the people most harmed by predatory lending practices, who were on the receiving end of extraordinary dubious financial advice which has, in many cases, cost them not only their home, but also their credit rating and future viability in the job market, is to bar them from seeking remedy in the the courts.

Oh, shit. What am I saying? That’s not what I think at all. Must be the after effects of those weird Republican drugs I was taking over the weekend that always make me think the stupidest, cruelest shit imaginable is really, fundamentally awesome. Well, at least we don’t have to worry about Democrats proposing that sort of nonsense.

What’s that you say? Oh, shit.

The “oh, shit” link (the post is from Suburban Guerilla) is to an article about Hillary Clinton, and the clear implication is that Hillary has proposed barring homeowners from suing predatory lenders. If that’s true it is not borne out by the linked article:

The New York senator proposed greater protections for lenders from possible lawsuits by investors, a variation of so-called tort reform. For years, GOP leaders have called for restrictions on what they consider unwarranted lawsuits against businesses. Democrats have often resisted them on grounds they limit injured parties’ legitimate rights to redress.

“Many mortgage companies are reluctant to help families restructure their mortgages because they’re afraid of being sued by the investment banks, the private equity firms and others who actually own the mortgage papers,” Clinton said in what she billed as a major address on the economy at the University of Pennsylvania.

There is nothing in the article to support the contention that Clinton is trying to bar the homeowners from suing. Clinton is talking about people who invested in the sliced and diced mortgage backed securities. I.e., she is turning the Republican guns back at them, since it is the fat-cats (well, slightly less fat now) who would be thrown out of court.

We Democrats have to stop beating up on our own.

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In which I beat several dead horses

Monday, March 24, 2008

From this Morning’s Times:

“The news business is something worse than horrible. If that’s the future, we don’t have much of a future,” Sam Zell, who bought the Tribune Company last year, said recently in The Baltimore Sun.

The Tribune Company, and therefore Sam Zell, owns the Hartford Courant.

Years ago I heard a story about the company that made Gravy Train dog food. Spurred on by the bean counters, it continually cheapened the formula in its gravy making dog food. Sales began to plummet. At first they couldn’t figure out why. Then they found out: the cheaper formula no longer made gravy. I heard this story years ago, and can’t vouch for it 100%, but it has the ring of truthiness.

Which brings us to Mr. Zell’s Hartford Courant. Today’s front page features the following:

1. Top Story: First born children get more attention from their parents.

2. There’s a woman in Connecticut who does animal autopsies.

3. People in the tiny upscale suburb of Colebrook help each other.

4. Look inside for a story about Personal Digital Keyboards if you want to play the piano.

5. There’s an antique mall in New Haven, look inside.

Also on the front page, besides the above “articles”:

6. A “link” (sorry, I can’t think of the correct term) to the sports pages, re: the UConn women.

7. A “link” to a story about “Bunnytown”, a “Kid’s Show for Grownups”.

8. A “link” to a story on page A3 about the 4,000th American casualty in Iraq.

Maybe the reason newspapers are having such a hard time is that they’re not making gravy anymore, or not much of it, judging by the above. No doubt Mr. Zell would tell us that he’s giving the people what they want, but the fact remains that the decline in newspaper readership corresponds in time to the de-newsification of the average newspaper.

Sidebar: Also in this morning’s Times, we are told that the media is paying less attention to the Iraq War, which is blamed on the fact that the public is losing interest. There’s a chicken and egg problem there, but that seems to be mostly ignored in the article.

To every cloud there is a silver lining, of course. I was struck by this:

“I was getting on average three to five calls a day for interviews about the war” in the first years, said Michael E. O’Hanlon, a senior fellow on national security at the Brookings Institution. “Now it’s less than one a day.”

It would be nice if we could conclude that the media has stopped calling Michael O’Hanlon because he was wrong about Iraq at the start and has been consistently wrong all along, but that is too much to hope for. In this country, being consistently wrong is a mark of distinction. Why, even Hillary wants to put Alan Greenspan in charge of fixing the mess he helped create.

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“Moving paper fantasy” hits real wall

Sunday, March 23, 2008

Last month I mentioned an article I read about “credit default swaps”, another off the books sort of financial chicanery that might be lurking in the background ready to cause financial havoc. These are, as best as a I understand, freely tradable credit “insurance policies”, which, for the holders, amount to bets that insured loans will default.

There are three excellent articles in today’s Times on the financial crisis, one on the front page (here) , and two in the business section (here and here). The first article has been justly criticized for noting that George Bush and his treasury secretary are philosophically opposed to regulations that hamper economic activity, as if there are people who are philosophically in favor of such regulations. Nonetheless, it does a pretty good job of laying out the issues we will be facing as we look to regulate investment banks and the various financial instruments in which they trade. If, as seems more and more likely, we are to endure another four years of a Republican chief executive, we are likely to get next to nothing by way of real regulation of these entities. If the people opposing these regulations had the interests of these institutions at heart they would accept a fair degree of regulation, because their long term existence is at risk if they must compete with other unregulated institutions in dealing with ever riskier and more complex instruments that they don’t understand. But if you stand to gain a hundred or two hundred million dollars in income in a year or two, income you get to keep when the institution you are “serving” tanks, you have a powerful disincentive to fight something that might be to everyone’s long term good. It is beyond belief that these greedheads are allowed to make unregulated decisions that, eventually, are bound to have catastrophic effects on the economy. But they are, and there are always true believers who will tell you that unregulated markets are the cure for all that ails you, notwithstanding history and common sense to the contrary.

Both articles in the business section put those credit default swaps at the heart of the financial mess and/or the recent bailouts, and Gretchen Morgenstern, in the first of the linked articles from the business page, pretty much claims that the recent Bear Stearns bailout was at least in part an attempt to deflate this unregulated market:

But a closer look at the terms of this shotgun marriage, and its implications for a wide array of market participants, presents another intriguing dimension to the deal. The JPMorgan-Bear arrangement, and the Bank of America-Countrywide match before it, may offer templates that allow the Federal Reserve to achieve something beyond basic search-and-rescue efforts: taking some air out of the enormous bubble in the credit insurance market and zapping some of the speculators who have caused it to inflate so wildly.

Of course, it could be simple coincidence that the rescues caused billions of dollars (or more) in credit insurance on the debt of Countrywide and Bear Stearns to become worthless. Regulators haven’t pointed at concerns about credit default swaps, as these insurance contracts are called, as reasons for the two takeovers. (And Bank of America’s chief executive, Kenneth D. Lewis, has flatly denied that his deal with Countrywide was at the behest of regulators.)

Yet an effect of both deals, should they go through, is the elimination of all outstanding credit default swaps on both Bear Stearns and Countrywide bonds. Entities who wrote the insurance — and would have been required to pay out if the companies defaulted — are the big winners. They can breathe a sigh of relief, pocket the premiums they earned on the insurance and live to play another day.

…

On the other hand, the big losers here are those who bought the insurance to speculate against the fortunes of two troubled companies. That’s because the value of their insurance, which increased as the Bear and Countrywide bonds fell, has now collapsed as those bonds have risen to reflect their takeover by stronger banks.

Naturally, of course, the losers will not really be the speculators who have caused the problem, because they are the hedge fund managers. The losers will be the people who invested in these hedge funds. There is probably no need to shed tears for these folks, but it would be nice to see the managers take it on the chin. But will they? According to Morgenstern:

It’s pretty clear that some major losses are floating around out there on busted credit default swap positions. Investors in hedge funds whose managers have boasted recently about their astute swap bets would be wise to ask whether those gains are on paper or in hand. Hedge fund managers are paid on paper gains, after all, so the question is more than just rhetorical.

If I understand that right it means that the hedge fund managers can give themselves a payday by declaring paper gains when they buy these instruments, and then hand the losses over to the investors (and the hedge funds) when those paper gains become real losses. Like the heads of all those mortgage companies, they’ll walk away with real millions while leaving failed companies in their wakes. Presumably this will cause more financial havoc, and as with the investment banks, we will somehow end up picking up the pieces.

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