2010 - %3, July

Friday Cat Blogging - 2 July 2010

| Fri Jul. 2, 2010 2:42 PM EDT

Domino's new favorite place is inside our closet underneath Marian's clothes, and since I know that everyone wants the very latest on cat habits here at Drum Central I figured I'd better get a picture of it. Unfortunately, Domino was a pain in the ass this week. Every time I walked into the closet and put the camera down at floor level, she immediately popped up and came out to investigate and be petted. Also unfortunately, although my camera has a terrific red-eye reduction for pictures of humans, it completely lacks laser-eye reduction for pictures of cats. So this is the best I could do. This is where Domino hides out for her afternoon snooze these days.

As for Inkblot, here he is on top of a bureau in the kitchen. He loves it whenever I put him up there, but for some reason he never jumps up himself. I'm really not sure what the deal is with this.

Need more? Well, the economic news has been pretty dismal this week, so courtesy of my sister, click here to read the inspiring story of Oscar the bionic cat. Oscar lives on the island of Jersey, and following a run-in with a combine harvester he became the star of the first episode of a new BBC show, The Bionic Vet. Oscar has been outfitted with a pair of titanium legs, and although he now has to stay inside he's apparently pretty happy with his new prosthetics. Enjoy!

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Are There Jobs But No Workers?

| Fri Jul. 2, 2010 2:07 PM EDT

I'm trying to make sense out of today's New York Times piece about factories having difficulty hiring the right kind of workers, but I'm having trouble. The basic story we've been hearing for the past few years makes sense: broad sectoral shifts in hiring mean that firms with job openings can't always find good candidates even though the recession has provided them with millions of unemployed workers to choose from. Lots of construction workers have lost their jobs over the past couple of years, but that doesn't do you much good if you're looking for experienced lathe operators.

But that's not quite the story the Times is telling. First, there's this:

Here in this suburb of Cleveland, supervisors at Ben Venue Laboratories, a contract drug maker for pharmaceutical companies, have reviewed 3,600 job applications this year and found only 47 people to hire at $13 to $15 an hour, or about $31,000 a year. The going rate for entry-level manufacturing workers in the area, according to Cleveland State University, is $10 to $12 an hour, but more skilled workers earn $15 to $20 an hour.

This is a little fuzzy, but at first it sounds as if Ben Venue isn't willing to pay enough to get skilled workers, who typically earn $15-20 per hour. "The problem appears to be that manufacturers don't want to pay the market wage for the skills that they need," says Dean Baker. "This is like someone who wants to buy a 4-bedroom home with a yard in a good neighborhood in Washington for $200,000, and then complains that there is a shortage of good homes."

But then there's the next paragraph:

All candidates at Ben Venue must pass a basic skills test showing they can read and understand math at a ninth-grade level. A significant portion of recent applicants failed, and the company has been disappointed by the quality of graduates from local training programs. It is now struggling to fill 100 positions.

Now it sounds like Ben Venue is indeed looking merely for entry level workers who have ninth-grade math abilities. But they can't find them.

This is, however, not a sectoral shift problem. It's a claim that they can't find entry level workers who can do — what? Algebra? Simple percentages? I'm not sure what counts as ninth-grade math here. But something doesn't sound quite right. If Ben Venue is struggling to find people to fill these positions now, they must have really been struggling to fill them before the recession, when workers had a lot more choices than they do now. Their requirements can't have changed too much just in the past couple of years.

My guess: in addition to a simple aggregate lack of jobs due to the recession, what we're suffering from right now is still more of a sectoral shift issue more than a basic skills issue. If you look at lists of the fastest growing occupations, they've always been populated mainly by jobs that require a high school degree and some specialized training. Lots of them are in healthcare (physical therapists, dental assistants, etc.) and lots of them require specific computer skills. Laid off factory workers just can't jump into these jobs without retraining, and as Matt Steinglass points out, the success of government retraining programs has been pretty dismal over the years:

Still, it's striking that Congress may be grudgingly willing to spend on extending unemployment benefits, but not on doing anything geared towards addressing the structural reasons why Americans are unemployed....Maybe government isn't very good at worker training, and investments in other kinds of capital, such as improved infrastructure (high-speed trains, bridge and highway improvement, low-emission energy generation) may produce better returns. But what Congress seems to be saying, at this moment of increasing deficit hawkishness, is that government can't do anything at all about high structural unemployment. All it can do is maintain a safety net for the unemployed. Perhaps severe cutbacks in state government spending, forced by lower tax revenues, will induce the private sector to regain confidence in the economy. Alternatively, we'd better just get used to paying a lot of money for indefinite extensions of unemployment insurance.

That's a grim forecast. Unfortunately, it also seems pretty persuasive.

Courses at Glenn Beck's New U.

| Fri Jul. 2, 2010 1:06 PM EDT

Have you heard the exciting news? Apparently appalled at the paucity of solid learnin' in America (excepting, of course, Texas), media maestro and renowned art historian Glenn Beck has announced the opening of his own great patriotic hall of academe. The forthcoming institution o'learnin', appropriately titled Beck University, will "explore the concepts of Faith, Hope and Charity and show you how they influence America’s past, her present and most importantly her future." Its faculty features such luminaries as a free-market economist whose degree is in psychology and a Texas Republican Party bigwig who hates, hates, HATES church-state separation. It even has an Ivy-style crestfeaturing a feather, a buffalo, and the disembodied head of George Washingtonand a Latin motto, "Tyrannis Seditio, Obsequium Deo" (roughly translated: "Revolution against tyrants, submission to God").

No word yet on whether RNC Chairman Michael Steele, apparently in need of some good historical and civics education of late, has enrolled. But just in time for the Independence Day weekend, the MoJo staff has produced a list of course offerings we hope to see at Beck U. next fall. If you have suggestions, too, post 'em to the comments or post them to Twitter with the hashtag #BeckUCourses! Let's do some educatin'! Yee haw!

  • Theories of Self and Other in the Autobiography of Ronald Reagan
  • Semiotics of Tricornered Hats
  • Mythology 101: Fossils
  • Presidential History From Harding to Coolidge
  • Oath Keeping
  • Semester Abroad in Kenya with Visiting Professor Dr. Jerome Corsi
  • Physics of AM Radio Waves
  • Fundamentals of Spelling and Grammar CANCELED
  • Great Military Heroes: John Wayne
  • Intro to Theology: Ayn Rand
  • Advanced Marketing Seminar: Rare Gold Coins
  • Drama 101: Intro to Alternative Lifestyles
  • Psych 301: Paranoia as Therapeutic Alternative
  • Wilde, Proust, and Other Homosexual Europeans
  • Middle Eastern and Arab Cultures: What's Up With That?
  • Literary Masters Colloquium: Cleon Skousen
  • Motherhood, Hockey, Hunting: Cultural Convergences
  • Studies in Moral Courage: Joe McCarthy
  • Counterinsurgency Techniques in Morning Radio
  • Phenomenological Epistemology and the Speeches of Barry Goldwater
  • Hermeneutics and Homosociality in The Overton Window
  • Political Science 300: Reverse Racism and the Modern Presidency
  • Colloquium on Great Filmmakers: Mel Gibson
  • Gym Crow
  • Underwater Conspiracy Weaving

Supreme Court on Pfizer's Pharmaceutical Colonialism

| Fri Jul. 2, 2010 12:54 PM EDT

While the media was chewing over the Supreme Court’s gun decision earlier in the week, another significant action passed with little comment. That was the court’s refusal to throw out a case brought under the Alien Tort Statute on behalf of Nigerians whose children died or suffered terrible damage in a Pfizer drug experiment.

The case is of considerable importance, because so many drug companies have conducted tests of new medicine’s abroad in poor countries, using the residents as lab rats in what some have dubbed “pharmaceutical colonialism.” The BBC reports:

The US Supreme Court on Tuesday declined to take up a case examining whether drug giant Pfizer could be sued in an American court for allegedly conducting nonconsensual drug tests on 200 Nigerian children in 1996. The action allows the case to move toward a trial. Eleven of the children died, and many others were left blind, deaf, paralyzed, or brain-damaged, according to court documents.

At issue in the Supreme Court appeal was whether the surviving children and relatives of the children were entitled to file a lawsuit in New York seeking to hold Pfizer responsible. Usually, such a suit would be filed in Nigeria. Lawyers for the children complained that Nigerian judges are corrupt and that the US court system holds the only promise of justice.

Playing With Economic Fire

| Fri Jul. 2, 2010 12:48 PM EDT

If the United States reduces spending and cuts its budget deficit, will that restore consumer confidence and help economic growth? Well, it's worked before — in other countries, other eras, and under other circumstances than today's. Bruce Bartlett summarizes the historical record:

Thus it turns out that fiscal contraction isn’t really expansionary except under conditions that do not exist today, and only when complimented by policies the U.S. is not free to pursue. Inflation and interest rates are at historically low levels and are not going to fall much lower even if the deficit disappears. As noted earlier, the Fed has limited capacity for further easing, and we can’t really depreciate our currency because it floats, nor is there any country to which we could realistically raise our exports to any great extent. Moreover, just about every other country is trying desperately to increase their exports to stimulate growth and all can’t do so simultaneously.

This is not an experiment that's going to turn out well. Consumer spending isn't going to rise while unemployment is high and wages are stagnant. (Former Jeopardy! champ James Pethokoukis on today's employment news: "If workforce had not shrunk so dramatically, the unemployment rate would have risen to 9.9 percent. Yes, I did the math.") Nor are consumers likely to draw down their savings or increase their borrowing. Just the opposite, in fact. And businesses aren't going to increase investment as long as consumers are in the doldrums. All of this remains true regardless of the state of the deficit. So how exactly is fiscal austerity going to help the economy?

It's possible, I suppose, that the economy will recover strongly and a few years from now we'll all figure out the mechanism that made it happen. But I doubt it. We're playing with fire here.

Is Democratic Unity Possible?

| Fri Jul. 2, 2010 12:26 PM EDT

I think my general feeling about Bob Shrum is that if he says Democrats should do something, their best bet is to do the opposite. But this advice actually sounds fairly plausible:

Why should Congress take its annual August vacation while 15 million Americans are unemployed and millions more are underemployed, underpaid, or under the radar of official statistics because they are so discouraged they’ve stopped looking for work? With oil gushing into the Gulf, why should senators and representatives be rushing out of Washington to travel, raise money, and campaign?

Democrats in the House will respond that they’ve done their job; the Senate is the roadblock. Democrats in the Senate will plead that they’re not the problem; a willful GOP minority is blocking progress not just out of spite, but calculation. Republicans figure that a slow recovery and the lingering oil slick will drive a protest vote for them in November.

The Democratic arguments are right, but largely irrelevant and generally ignored by a fearful and frustrated electorate. Ironically, the way to break through is not to flee the Beltway, but to keep Congress there in a drama that plays out on center stage — in front of the cameras — with the president calling a special session of Congress to deal with too-long delayed issues of urgent national necessity.

This would sound plausible, anyway, if Democrats had their act together a little better. In general, the idea here would be for Obama to submit a raft of popular, highly targeted jobs bills to Capitol Hill and insist that Congress vote on them. One by one, either Republicans would defect and Dems would get a series of wins, or else, one by one, we'd get a series of 59-41 votes that would showcase Republican intransigence on the economy.

But would it work if, instead, each bill were the source of intra-party bickering that turned off the voters, long delays that made Washington seem impotent, and votes that ended up 53-47 because a handful of centrist Democrats insisted on breaking ranks? Probably not. And unfortunately, that's probably what we'd get. Better Democrats, please.

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RNC Chair: Obama Started War in Afghanistan

| Fri Jul. 2, 2010 11:59 AM EDT

Adducing yet more evidence that Michael Steele is a mendacious clown hardly seems worth the bother, but this is pretty spectacular even by his standards:

Keep in mind, again, federal candidates, this was a war of Obama's choosing. This was not something that the United States had actively prosecuted or wanted to engage in....But it was the president who was trying to be cute by half by flipping a script demonizing Iraq, while saying the battle really should in Afghanistan. Well, if he's such a student of history, has he not understood that, you know, that's the one thing you don't do, is engage in a land war in Afghanistan? All right? Because everyone who has tried over a thousand years of history has failed, and there are reasons for that. There are other ways to engage in Afghanistan without committing U.S. troops.

It starts around the 0:20 mark. I'm taking bets in comments: what Bush-era policy will Steele repudiate next? I'm hoping he blames lower tax rates on Obama.

Gulf Disaster Hits Another Milestone

| Fri Jul. 2, 2010 11:48 AM EDT

The BP oil disaster in the Gulf may have passed a milestone yesterday, and it wasn't a good one. The oil spill likely became the largest ever in the Gulf of Mexico, eclipsing the previous Ixtoc I spill off Mexico's coast.

The Ixtoc disaster spanned 9 months, from June 3, 1979 to March 23, dumping 140 million gallons into the Gulf.

The highest estimate from the government flow rate team for the current BP spill is that 2.5 million gallons are spewing into the Gulf every day, which would put the total as high as 159 million gallons at this point. Even the lower-end government estimates would put the spill at 83 million gallons so far.

The disaster might now be the biggest in the Gulf, but it still doesn't qualify as the worst in world history. That was in Kuwait in 1991, when up to 520 million gallons were dumped when Iraqi forces opened the valves on an oil terminal to impede the advance of US troops.

The Gulf disaster still has plenty of time to set even more disgraceful records. It's expected to keep flowing for at least six more weeks until the relief wells are finished (most likely in mid-August). Incident commander Thad Allen, who officially retired from the US Coast Guard Admiral this week, said the government has directed BP to figure out how to capture up to 90 percent of the gusher by mid-July. But he was hesitant to give any more optimistic estimates of an actual date when they can stop the spill.

"I'm reluctant to tell you it will happen before the middle of August," Allen told reporters yesterday. "I would rather under promise and over deliver with you folks."

In any case, the tragedy is far from over.

Boston With Good Weather

| Fri Jul. 2, 2010 11:28 AM EDT

Matt Yglesias on his visit to California:

Every trip I ever take to this state is a time to become frustrated anew that the bulk of America’s walkable urbanism exists in the horrible-weather locales of the Northeast or else the even-worse-weather locale of Chicago. Head west to California and the climate is lovely — tons of great places to walk around — but the built environment is inhospitable to such endeavors. It’s a huge shame. If you took Boston and relocated it to somewhere in California, it would possibly be the greatest place on earth. Instead it’s Boston.

Hmmm. That's been done, hasn't it? I think they called it San Francisco, and its residents are indeed convinced that it's the greatest place on earth. Just ask them. And with all the hills, it's much better for your cardiovascular health, too!

Are We Headed For a Double Dip?

| Fri Jul. 2, 2010 11:19 AM EDT

From the LA Times today:

A fresh batch of weak economic news Thursday heightened concerns about the staying power of the fledgling recovery, with more uninspiring news expected Friday when the government reports on the May job market.

....Most economists still see a "double dip" as a remote possibility, clinging to forecasts that the economy will muddle along at a modest pace for several quarters....After a series of strong economic data early this year, recent reports have been more mixed, but that hasn't altered the fundamental outlook for the economy, said Ken Matheny, a senior economist at Macroeconomic Advisers, a forecasting firm based in St. Louis.

Well, "most" forecasters may think a double dip is a remote possibility, but not John Hussman:

A few weeks ago, I noted that our recession warning composite was on the brink of a signal that has always and only occurred during or immediately prior to U.S. recessions....What prompts my immediate concern is that the growth rate of the ECRI Weekly Leading Index has now declined to -6.9%. The WLI growth rate has historically demonstrated a strong correlation with the ISM Purchasing Managers Index, with the correlation being highest at a lead time of 13 weeks.

....Taking the growth rate of the WLI as a single indicator, the only instance when a level of -6.9% was not associated with an actual recession was a single observation in 1988.

Great. And today's lousy jobs report may put a few more folks in Hussman's camp. Buckle your seat belts.