2013...mewhat-popular - %2

What Is a Derecho, Anyway?

| Wed Jun. 12, 2013 7:57 PM PDT
A derecho gathered outside Chicago in 2008.

You've probably heard that a massive system of storms is currently bearing down on the Midwest and expected to reach the mid-Atlantic on Thursday. Meteorologists are warning that the storms may turn into derechos, or "land hurricanes." Almost 75 million people are in the path of the storms, and forecasters believe that conditions are favorable for one or more derechos this week. So what can we expect from these intense storms?

What is a derecho? According to NOAA, a derecho is a "widespread, long-lived windstorm that is associated with a band of rapidly moving showers or thunderstorms." In order for a weather event to be classified as a derecho, the wind damage zone must extend more than 240 miles and include wind gusts of at least 58 miles per hour. In "super-derechos", wind gusts can top 100 miles per hour.  "You can think of a derecho as a tropical cyclone over land," NOAA research meteorologist Ken Pryor told Discovery News. "The impacts are very similar. There are damaging winds that cover a significant area." The storms are known to occur frequently at night, and they often bring hail, flooding, and tornadoes

Is it like a tornado? Not exactly. The two types of storms can occur in the same system, but the damage of a derecho is directed along a fairly straight path and tornadoes are more isolated events. "A tornado, when it does occur, may be on the magnitude of a mile or two wide; a derecho could go for hundreds of miles producing significant damage," Jim Keeney, weather program manager at the national weather service's office in Kansas City, Mo., told CBS

What causes it? Derechos are associated with showers and thunderstorms where there are strong outflow winds that "move preferentially in one direction," and are the products of downbursts, according to NOAA. "Imagine taking a water balloon and dropping it, where you see the balloon break and splatter on the ground. That's basically how a downburst works," Pryor told NBC News. "And you can think of a derecho as a large cluster of those downbursts all happening simultaneously."

NOAA

When and where do they usually occur? They are most common in late spring and summer with more than 75 percent occurring between April and August. Check out this handy NOAA map below to see how frequently they hit different regions:

NOAA

When was the last one? A particularly destructive derecho causing $1 billion in damage hit a 700-mile swath between the Ohio Valley and the mid-Atlantic last June. Five million people from Chicago to the mid-Atlantic coast lost power, and 22 were killed. NOAA has documented 26 noteworthy derechos since the late 1960s. Below is a diagram of one that hit Kansas, Oklahoma, and Texas in 2001:

Area affected by the May 27-28, 2001 derecho (outlined in blue). Curved purple lines represent the approximate locations of the gust front at three-hourly intervals. "+" symbols indicate the locations of wind damage or wind gusts (measured or estimated) above severe limits (58 mph or greater). Red dots and lines denote tornadoes. NOAA

Is climate change involved? According to NOAA, "Some of the most intense summer derechos, especially those of the progressive type, occur on the fringes of extreme heat waves." After last year's deadly derecho, some wondered if climate change caused or intensified it

Since climate change can boost the odds of major heat waves such as this one, and the extreme heat contributed to the severe weather, it's plausible—albeit rather speculative at this point—that climate change played some sort of role in the derecho event. However, it will require rigorous scientific analysis to determine whether this may have been the case.

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Corn on "Hardball": The Rise of Paranoia Over US Surveillance

Wed Jun. 12, 2013 7:19 PM PDT

In recent days, politicians such as Ron Paul have used the NSA surveillance scandal to make paranoid claims about the nature of US government surveillance, suggesting, for example, that the government might target Snowden with a drone or missile. Time's Joe Klein and DC bureau chief David Corn discuss this rising paranoia, which Klein discussed in a recent column, on MSNBC's Hardball:

David Corn is Mother Jones' Washington bureau chief. For more of his stories, click here. He's also on Twitter.

An Update on America's Antique Credit Card Industry

| Wed Jun. 12, 2013 5:59 PM PDT

Matt Yglesias is traveling in Europe right now, so naturally he's complaining about America's continued reliance on absurdly outdated magnetic stripe technology for its credit cards. Chip-and-PIN smart cards are used almost everywhere in Europe, which means that old style American cards often won't work—sometimes because automated kiosks won't accept them and sometimes because befuddled clerks have never seen one before and don't know what to do about them. As you may recall, I whined about this last year before my family trip to Denmark and Italy.

Anyway, this got me curious: how are things going on the chip-and-PIN front? So I did a bit of googling and at first the news seemed good: a growing number of American card companies offer smart cards, some with no/low annual fees and no foreign transaction fees. Hooray! But as I continued looking into this, it turned out that virtually none of them were truly chip-and-PIN cards. American banks have instead decided to invent a whole new technology called chip-and-signature. WTF? Is this actually any more likely to work in Europe than an old school mag stripe card?

Most of the articles I read were frustratingly vague on this point, but this one from John Kiernan seems pretty authoritative and boils down to: no. Contrary to the happy talk from U.S. card flacks, "practical experience and consumer feedback indicate that you can still use magnetic stripe credit cards pretty much anywhere that will accept a chip-and-signature card. And the few places where magstripe cards don’t work (i.e. certain unattended kiosks), chip-and-signature cards don’t tend to work either."

OK then. It's basically a marketing scam. But we're still left with a question: why don't U.S. banks just offer real chip-and-PIN cards? They aren't expensive, and the technology is well understood since every bank in Europe does it. What's more, chip-and-PIN cards all have mag stripes on the back, so they'll work fine in U.S. machines too. What's the deal?

According to Kiernan, banks just don't feel like it because they don't have any incentive to do it at the moment. Plus this:

In addition, there are certain transitional, regulatory and logistical issues for banks that explain why they have not simply adopted chip-and-PIN credit cards.

Well, now he's just playing mind games with me. What regulatory and logistical issues? Tell me, tell me, tell me!

In any case, the bottom line seems to be that things are now worse than ever. If you sign up for a "smart card" from a U.S. bank, you'll feel more secure before you travel to Europe, but in fact you'll be every bit as vulnerable as you were before. It's the kind of unconscionable bamboozlement I've come to expect from the American banking industry. My advice for European travelers: hope for the best, but always carry a fair amount of cash with you just in case.

And what if you want a real chip-and-PIN card? Well, apparently the State Department Federal Credit Union, which anyone can join through its partnership with the American Consumer Council, offers one. So there's that. And USAA has a genuine chip-and-PIN card for its members. Aside from that, your only real option is to wait until 2015, when chip-and-PIN is allegedly going to get rolled out in the United States. Yeesh.

How Wall Street Takes Ordinary Schlubs to the Cleaners

| Wed Jun. 12, 2013 3:00 PM PDT

In my previous post I wrote about the disclosure that, for a price, investors can get access to the University of Michigan consumer confidence index a few minutes before the usual 10 am release time. In fact, high-speed traders pay to get access just two seconds earlier than everyone else. I concluded that instead of having to work harder or risk breaking the law to get early information, as in the past, "now you just have to pay a fee in order to guarantee that you can take all the ordinary schlubs to the cleaners." Felix Salmon, ever the contrarian when it comes to little guys getting screwed by Wall Street, tweeted back:

Dear @kdrum, how exactly are ordinary schlubs being taken to the cleaners here?

Well, here's my case, in convenient list form:

  1. Wall Street traders are paying for this early information.
  2. They aren't idiots. They'd only do this if they could make trading profits based on their insider knowledge.
  3. No new money is created by making this information available to a few well-heeled traders a few minutes before everyone else. It's a zero-sum game.
  4. Thus, someone is getting the short end of these trades.
  5. That someone must be the people who aren't paying for early access. There's no one else these traders could be taking advantage of.
  6. And who are these folks? I don't know. But almost by definition, once the snowball rolls all the way downhill the answer has to be people who aren't plugged in and don't have the money to buy early access. In other words, ordinary schlubs.

I'll grant that this argument isn't 100% watertight. It's possible that the early-access crowd all spend a few minutes fighting with each other, and by the time 10 am rolls around the market is exactly where it would have been otherwise. It's also possible that Wall Street's sharpest traders pay for this information in order to get better returns for the widows and orphans funds they run. But I don't believe in the tooth fairy and I don't believe in either of these things either.

Bottom line: the release of financial information moves markets. If you have early access to this information, it means you have privileged insight into how the market is going to move five minutes from now. That's a moneymaker, and the money is made from all the people who trade with you during the period when you know more than they do.

Wall Street pros, of course, have always known more than most of us. They work harder, they have more training, they have Bloomberg terminals, etc. That's produced a skyrocketing amount of unproductive financial activity over the past few decades, but usually in ways that are at least marginally defensible. This latest disclosure, however, is almost a parody of unproductive financial activity. Not only is it obviously socially useless, but there's just something a lot rawer about providing an early release of supposedly public financial information to a chosen few who are willing to fork over a bit of squeeze. Welcome to the schlubocracy.

UPDATE: Karl Smith provides a more macro version of this argument here. It's worth a read.

"This Is the End": It's "Left Behind" for Potheads

| Wed Jun. 12, 2013 2:18 PM PDT
Left to right: James Franco, Jonah Hill, Craig Robinson, Seth Rogen, Jay Baruchel, Danny McBride.

This Is the End
Columbia Pictures
85 minutes

You remember Left Behind, don't you? It's the Christian-apocalypse film series (based on the books) starring conservative activist and former Growing Pains star Kirk Cameron. The three film adaptations are critically panned train wrecks that portray the Rapture by casting a fictional United Nations secretary general as the Antichrist.

There is quite literally no fathomable reason for you to watch the Left Behind movies. But do go see This Is the End, which is essentially the same thing, only instead of bizarre and awful politics, there's Emma Watson brandishing a gigantic ax.

What Happens in the University of Maryland NSA Facility Where Edward Snowden Worked?

| Wed Jun. 12, 2013 1:54 PM PDT
The Center for Advanced Study of Language near the University of Maryland, College Park.

Since the Guardian revealed Edward Snowden as the source behind its explosive scoops on National Security Agency surveillance, media outlets have been picking over the details of the whistleblower's life, everything from his stint in community college to the identity of his abandoned girlfriend. Here's another small detail about his background that intrigued some people: "[H]e got his first job in an NSA facility, working as a security guard for one of the agency's covert facilities at the University of Maryland." Some reporters were surprised to learn that the University of Maryland had a "covert" NSA facility operating somewhere on or near the school grounds. (The NSA itself is headquartered in nearby Fort Meade, Maryland.)

On Sunday, the Diamondback, the university's student newspaper, noted: "Which facility and exactly where it was Snowden worked is unknown, but the NSA has connections to several university facilities, including the Laboratory for Physical Sciences, the Office of Technology Commercialization and the Lab for Telecommunication Science." Later, the university confirmed that in 2005 Snowden worked for less than a year as a "security specialist" for the NSA-linked Center for Advanced Study of Language (CASL), which serves as a research center for the intelligence community.

The research done at CASL ranges from cultural and linguistic studies to work on "spycraft" technology (click here to read a rundown of the Center's language research, published in the NSA's quarterly online journal). One neuroscience project reportedly focused on filling in the blanks of incomplete texts, such as documents from corrupted hard drives or intercepted communications. "CASL's cognitive neuroscience team has been studying the cognitive basis of working memory's capacity for filling in incomplete areas of text," a CASL document reads. "They have made significant headway in this research by using a powerful high-density electroencephalogram (EEG) machine acquired in 2006." Another project involved training subjects to control their own brain-wave activity.

The university administration has touted its NSA partnership. "In support of the nation's critical need for increased language capabilities, this Center will conduct groundbreaking research in areas such as language acquisition, contextual analysis of language, and human computer interaction and computer translation, and become the largest center for language study in the world," C.D. Mote, Jr., former president of the university, announced in September 2003.

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The Financialization of America: A Wee Example

| Wed Jun. 12, 2013 10:47 AM PDT

Once a month, at 10 am, the University of Michigan releases its consumer confidence index. But not everyone gets it at the same time. Thomson Reuters pays Michigan a million dollars a year for early access:

Five minutes before that, at 9:55 a.m., the data is distributed on a conference call for Thomson Reuters' paying clients, who are given certain headline numbers.

But the contract carves out an even more elite group of clients, who subscribe to the "ultra-low latency distribution platform," or high-speed data feed, offered by Thomson Reuters. Those most elite clients receive the information in a specialized format tailor-made for computer-driven algorithmic trading at 9:54:58.000, according to the terms of the contract. On occasion, they could get the data even earlier—the contract allows for a plus or minus 500 milliseconds margin of error.

Read the whole story for more, but in the meantime just sit back and be amazed at how high-speed trading has changed things. Getting early access to economic information has been important for centuries, and people have always been willing to pay for that early access. In the past, though, getting early access has always required either putting in extra work—for example, paying lookouts for early reports of ships coming into port—or else outright fraud—think Trading Places. But not anymore! This isn't exactly something that either Michigan or Reuters advertises, but now you just have to pay a fee in order to guarantee that you can take all the ordinary schlubs to the cleaners.

This is a small example of the financialization of America that I posted about yesterday. It has no possible social value, and it doesn't make credit markets more efficient in any way. It's just a purely artificial way for the rich to hoover up economic rents, and it's fully institutionalized and above board. Lovely, isn't it?

Chart of the Day: The Great Gatsby Curve

| Wed Jun. 12, 2013 10:11 AM PDT

Via Counterparties, I see that the White House has released an animated version of a chart created recently by Alan Krueger, Chairman of the Council of Economic Advisers:

The Great Gatsby Curve illustrates the connection between concentration of wealth in one generation and the ability of those in the next generation to move up the economic ladder compared to their parents....The curve shows that children from poor families are less likely to improve their economic status as adults in countries where income inequality was higher — meaning wealth was concentrated in fewer hands — around the time those children were growing up.

In a nutshell, children of poor families have a hard time moving up in the world in countries with lots of income inequality:

So why does this matter for the United States? The U.S. has had a sharp rise in inequality since the 1980s. In fact, on the eve of the Great Recession, income inequality in the U.S. was as sharp as it had been at any period since the time of "The Great Gatsby."

I know I've declared jihad on animated GIFs, but this one is actually sort of useful. It only takes a minute to unfold, and it demonstrates the problem pretty dramatically. Krueger's full speech from last year is here.

House GOPers Are STILL Saying Dumb Things About Rape

| Wed Jun. 12, 2013 9:23 AM PDT

Rep. Trent Franks (R-Ariz.)

In January, Politico reported that the conservative pro-life group Susan B. Anthony List was organizing special training sessions to teach male Republican lawmakers how to not make ignorant comments about rape (see: Akin, Todd). How's that working out so far? On Wednesday, Rep. Trent Franks (R-Ariz.), who is sponsoring a bill that would ban all abortions after 20 weeks, pushed back against an effort to insert an exception for women who have been raped by arguing that rape usually doesn't result in pregnancy:

The incidence of rape resulting in pregnancy are very low. But when you make that exception, there's usually a requirement to report the rape within 48 hours. And in this case that’s impossible because this is in the sixth month of gestation. And that's what completely negates and vitiates the purpose of such an amendment.

The Atlantic's Garance Franke-Ruta has the best deconstruction of this myth, but most serious studies of the issue conclude that pregnancies from rape are quite common. I've reached out to Rep. Franks' office to ask if he had attended the SBA List rape seminar. It seems unlikely.

New York's Gov. Cuomo Unveils His Own Bill to Battle Big-Money Politics—But Does It Matter?

| Wed Jun. 12, 2013 9:23 AM PDT
Gov. Andrew Cuomo.

With less than a week before New York State lawmakers go home for the summer, Gov. Andrew Cuomo (D) unveiled his own bill on Tuesday to curb Albany's streak of political corruption scandals and battle the state's big-money politics. Cuomo's bill would make it easier to convict someone for bribing public officials and ban anyone convicted of public corruption from ever again working in government. It would expand the state's voter registration period, beef up the enforcement of election laws, and let 16- and 17-year-olds pre-register to vote.

But it is the third piece of Cuomo's bill that campaign reformer types care about most. That piece calls for a public financing system for all New York State elections in which small donations up to $175 would be matched $6 to $1 with public money. The intent here is clear: Nudge candidates running for state Assembly and Senate to collect more two- and three-figure donations as opposed to courting wealthy donors who can legally give five- and six-figure donations under New York's lax election laws. "Governor Cuomo's proposal builds upon a small-donor matching fund system that has proven effective in New York City," says Michael Malbin, the director of the nonpartisan Campaign Finance Institute. "CFI's research shows the incentives work to get candidates to make low-dollar donors the financial backbones of their campaigns."

Foes of super-PACs and big-money politics see public financing as the best fix to today's money-soaked political system. And since a divided Congress won't take up public financing, public financing supporters believe the states give them the best shot at new reforms. Fair Elections for New York, a coalition of unions, good-government groups, and more, have invested heavily in passing a statewide public financing bill in New York, which they see as the marquee fight in the today's political money wars. "If you can make it here, you can make it anywhere," was how Nick Nyhart, president of the reform group Public Campaign, put it last year.

By introducing his own bill, Cuomo is signaling to resistant Republican lawmakers that he wants public financing before the current session ends. The governor is also showing his liberal allies that he's still entrenched in this fight, at least publicly.

Yet the prospects for reform in New York are not good. The Democratic-controlled state Assembly has already passed a public financing bill like Cuomo's, but the state Senate is run by a motley coalition of Republicans and so-called independent Democrats, and Senate Republicans have no interest in public financing. Despite several analyses showing a modest price tag for public financing of statewide elections, state Sen. Dean Skelos, the Senate GOP's leader, said he'd rather invest the money in "education, infrastructure, job creation, child care—there are a lot of areas that we can use that money for."

Even Cuomo questioned whether major corruption or campaign reforms could pass before the legislature adjourns next week. Calling his bill "needed" and "overdue," he added: "I would not say that I see an especially easy glide path to passage for this bill."

The action around public financing isn't just in New York. On Wednesday morning, 10 leaders of liberal groups pressed top Democratic lawmakers, including House Minority Leader Nancy Pelosi (D-Calif.), to unite behind a national public financing bill for Congressional elections. Read their full letter here.