2009 - %3, May

Too Good to Check

| Thu May 7, 2009 1:32 AM EDT

In the current issue of the New Yorker, Malcolm Gladwell has an article about how scrappy underdogs using insurgent tactics can beat the big guys, and the whole piece is wrapped around the story of a kids' basketball team that did really well using a full court press against better teams.  So why doesn't every underdog basketball team use a full court press?  Huh?

Reading this, I got sort of interested because I've wondered more or less the same thing from time to time.  It seems to me that the full court press is pretty effective.  On the other hand, I don't know squat about basketball, and I sort of vaguely figured that professional basketball coaches do, which means there's probably a pretty good reason that the press isn't ubiquitous.  Chad Orzel provides the answer:

The press works, as long as the other team isn't ready for it. The idea of a full-court press is to force the opponent into a rushed and frenetic game and get them out of their routine. A team that's ready for it, though, and has skilled and disciplined players, won't get rattled by the press, and can pick the press apart for lots of easy baskets. You can use the full-court press to rattle a superior team that isn't expecting it, but if they know it's coming, there are a lot of ways that pressure defense can fall apart — missed traps in the back court lead to two- or three-on-one breaks, over-aggressive defense leads to fouls, etc. The teams that have won titles using pressure basketball have also had lots of talent, because you need something to fall back on if the press doesn't work.

Like Chad, it's stuff like this that makes me wonder about Gladwell.  He's an engaging writer and he picks interesting subjects, but there are really only two alternatives here.  Either (a) he wrote this piece without bothering to learn enough about basketball to understand why the press isn't used much above the kiddie league level or (b) he knew the answer but chose not to share it with his readers because it would wreck his story.  Unfortunately, I suspect the answer is (b).  He seems like a guy who sometimes decides not to let the facts get in his way once he's settled on a good narrative.

Plus, as Chad says, Gladwell seems oddly insensitive to the criticism that "playing '40 Minutes of Hell' is kind of a dick move in a league of twelve-year-old girls."  But, really, it is.  The coach who did this isn't a brilliant innovator, he's kind of a dick.

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The Real Cost of Credit Cards: Small Business, Consumers, and Taxpayers All Pay the Price

| Thu May 7, 2009 1:06 AM EDT

In a move the AP described as “riding a crest of populist anger,” the House last week passed a credit card reform bill that goes after some of the industry's most predatory practices. But even if it makes its way into law, the new legislation will still leave the people plenty to be angry about. Credit card issuers have been furiously jacking up interest rates (even as the Fed cuts them), lowering credit limits, and generally scrambling to take another pound of flesh from an already battered American public.

Credit cards have yet another perverse effect on the overall economy, as well: They force up consumer prices. “Little attention has been given to the $48 billion in fees that credit card companies extracted from merchants last year,’’ writes Stacy Mitchell of the New Rules Project. “Largely invisible to the public, these fees, which amount to $427 per household, are ultimately passed on as higher prices to all consumers, whether they use plastic or not.’’ Most of these transaction fees are collected by Visa, MasterCard, and American Express, which together control 93 percent of credit card transactions in the United States.

While Visa and MasterCard set the rates--now averaging about 2 percent--it's the big banks issuing the credit cards that collect the fees. "Issuing credit cards has become a highly concentrated industry," Mitchell notes. "The top four card issuers— Citigroup, Bank of America, JP Morgan Chase, and Capital One— account for more than 70% of all cards in circulation.” Following the release of the "stress test" results, at least two of these four banks are expected to line up for a new round of bailouts from the federal government. Yet they will continue simultaneously dipping into the narrow margins of America’s business owners.

Taxing Carbon - Part 2

| Wed May 6, 2009 9:24 PM EDT

Yesterday, after reviewing the problems with a carbon tax, I asked why anyone would support going down that road vs. supporting a cap-and-trade plan.  Andrew Sullivan responds:

Because we actually believe that a carbon tax will bring green benefits without the kind of crude regulatory scheme that could stigmatize environmentalism for a long time? Because we think it will work better?

This deserves some unpacking.  For starters, you need to think about the kind of regulation and oversight that's required to reduce carbon emissions.  Take power plants, for example.  First you have to have technology in place to monitor carbon emissions from each plant, and then you have to have a regulatory bureaucracy in place to make sure the monitoring takes place properly.  That's a big job.  Once that's done and we know how much carbon is being emitted, plants have to either (a) pay a tax for each ton of carbon or (b) buy a permit for each ton of carbon.

The difference there is tiny.  You can pay the tax or you can buy permits on an electronic carbon exchange.  From the point of view of the plant, they each require about the same amount of work.

The carbon exchange itself, of course, does need to be set up and kept in operation by a government agency.  That's extra work compared to a tax, and it has to be done right.  Still, this is hardly untrod territory.  There are hundreds of electronic commodity exchanges around the world and we know how to set one up.  In fact, we've done it before for other cap-and-trade programs, and the operation of the exchange itself has never been that big a deal.

So far from being a "crude regulatory scheme," it's actually pretty elegant.  Emitters can buy permits depending on their needs while companies that make big cuts and have excess permits can sell them.  In terms of overhead at the corporate level it's hardly different from a tax at all.

As for a tax working better than cap-and-trade, why?  Both approaches put a price on carbon.  That either works or it doesn't.  It's true that there are some theoretical technical advantages to a tax, but there are some technical advantages to cap-and-trade too.  In the real world, they probably wash out.

Overall, the idea that cap-and-trade requires some kind of monstrous bureaucracy that a tax avoids simply doesn't stand up to scrutiny.  Most of the bureaucracy is dedicated to monitoring and enforcement, and you have that no matter what.  And cap-and-trade has the advantage of setting a cap and deriving the permit price from that, rather than letting Congress set a tax rate that will (supposedly) produce a suitable cap.  The former is relatively transparent, since the cap level is right in the legislation and the public knows precisely what it is.  The latter isn't, since the public has to decide which expert is right about the tax level needed to reduce emissions to the desired level.  The scope for fiddling and lying and delaying on this score is obviously immense.

As for vulnerability to loopholes and special interest breaks — well, both plans are about even on that score.  It's simply naive to think that either one will be more immune than the other.  Horsetrading is what politicians do, fine print is what lobbyists specialize in, and eternal vigilance is the only way to keep them under control.

In the real world, cap-and-trade requires Congress to set a transparent cap.  It uses a mechanism that's straightforward and proven.  It puts us in sync with Europe, which is already committed to cap-and-trade and has no interest in the tax approach.  And it's politically feasible.  Simply put, that's why it's the better approach for anyone who's serious about real-world results.

POSTSCRIPT: Mike O'Hare has a longer and more technical defense of a carbon tax here.  For now, let me just say that I disagree profoundly with his political analysis.  He's right that cap-and-trade is no cheaper than a tax (and it would be dishonest to imply otherwise), but I think he's wrong to believe that setting the proper tax level is easier and more efficient than setting the cap level directly.  From the point of view of both politics and public support, I think it's exactly the opposite.

More later on this, perhaps.

Today's Science Word: Epizootic

| Wed May 6, 2009 7:24 PM EDT

Sobering news today from ABC Science Online, via Discovery.com:

An epizootic—the wildlife equivalent of a human epidemic—of black band disease has appeared in the Great Barrier Reef, say Australian researchers.
Scientists, who have been monitoring the progress of the disease, say this the first time an epizootic of this type has been documented in Australian waters.

Read Julia Whitty's excellent Fate of the Oceans piece for some sorely needed context on today's news about our seas.

Who's Afraid of Social Security?

| Wed May 6, 2009 4:40 PM EDT

Ezra Klein, after noting that Steny Hoyer is trying to push ahead with Social Security reform, notes that congressional leaders are resisting the idea of naming a special commission to work on a proposal:

What liberals fear on Social Security reform is something like the proposed Conrad-Gregg Commission. A bipartisan commission that creates a set of recommendations and then fast tracks them through Congress. In general, the idea behind these proposals is that Congress can't change the commission's recommendation: It just votes up-or-down.

Well, I don't fear this, and I don't think Pelosi and Reid should fear it either.  It's true that my first choice is to do nothing for now and wait a decade or so to see how our finances shape up.  Trying to project 50 years in the future is dimwitted and we shouldn't pretend we can do it.

But the politics is a little bit different.  Even Republicans agree that privatization is off the table right now, which means that a bipartisan commission might very well come up with an acceptable set of tweaks that would balance Social Security's books.  And there's a genuine upside to this: at a fairly low cost it would take Social Security off the table for good.  No more endless whining from Pete Peterson and the Washington Post editorial board.  No more Republican kvetching about Social Security bankrupting America.  No worrying about yet another privatization plan rearing its zombie head the next time a Republican is in the Oval Office.  No more polls showing that more kids believe in UFOs than believe they'll get a Social Security check when they retire.  And Barack Obama would get a very nice post-partisan fiscal responsibility feather in his cap.

(Look: I don't care about postpartisanship very much, but obviously Obama does.  And he's a pretty smart guy.  I'm willing to let him play the game his way.)

So I say, give it a try.  If the commission proposal is no good, vote it down.  If it's OK, pass it.  And then we can spend the next eight years working on real long-term issues like healthcare and climate change.  What's the harm in letting Steny give it a try?

British Columbia Votes on Carbon Tax

| Wed May 6, 2009 4:32 PM EDT

North America's first carbon tax faces a critical test in upcoming elections in British Columbia. The results are likely to ripple across the continent.

Nature News points out that Canadian provincial elections don't normally garner international attention. But economists and environmentalists are viewing the election on May 12th as a test of several climate change policies. 

The incumbent Liberal Party government imposed a carbon tax in British Columbia in July 2008. It's been unpopular with many from the start because it boosted fuel costs during a time of record-high oil prices.

The opposition BC New Democratic Party (NDP) has vowed to "axe the tax," claiming it's ineffective and unfair to populations living in remote locations. Traditionally the NDP has been a greener party than the Liberals—leading some to accuse it now of attacking the carbon tax simply to chase votes in a tight election.

According to Nature News, economist Charles Komanoff, co-founder of the non-profit Carbon Tax Centre in New York, says: "We are keenly interested in watching this unfold. If [the tax] persists, it will give a big boost to the cause in the United States."

During Canada's 2008 federal election, the Liberal party campaigned for a green shift, hoping to put more tax burden onto polluters. They lost a bunch of seats for taking that stance and consequently the idea of a national carbon tax was scrapped.

A battle is also being fought in BC over independent power production. The Liberals have allowed private companies to apply for licenses for small hydroelectric projects that don't require building dams, claiming this is the most efficient way to boost renewable power production. Others claim company profits are incompatible with environmental stewardship and the NDP is campaigning to scrap this scheme too.

Tzeporah Berman of the climate-change advocacy group PowerUp Canada in Vancouver says British Columbia is going through are some of the world's first growing pains in adapting to  real climate policy. "The debate had been all abstract until now," says Berman. "It had been entirely possible to support a phase-out of fossil fuels and build-out in clean energy without having to face what those things mean in practice."

Developments in Canada are interesting to note in terms of a new political science study predicting the Obama presidency will likely break through a structural bias in American politics favoring the status quo and bring about significant changes in policy. The study predicts a shift in policy being twice as large as produced by Bill Clinton’s election in 1992, 40 percent larger than Ronald Reagan's election in 1980, and twice as large as FDR's election in 1932.

The prediction is based on a "pivotal politics" theory and employs the concept of the "gridlock interval" to assess the likelihood of policy change in Obama administration. You can download the paper [pdf] from PS: Political Science & Politics for free.
 

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Weird Bird Smuggling News

| Wed May 6, 2009 4:13 PM EDT

Liquids? Nope. Gels? Nah. Aerosols? Uh-uh. Birds? Ah-ha!

Yesterday, a man attempting to smuggle songbirds into the US from Vietnam was betrayed by his flamboyant leggings:

Sony Dong, 46, was arrested at Los Angeles International Airport in March after an inspector spotted bird feathers and droppings on his socks and tail feathers peeking out from under his pants, prosecutors said.

"He had fashioned these special cloth devices to hold the birds," said U.S. attorney spokesman Thom Mrozek. "They were secured by cloth wrappings and attached to his calves with buttons."

The reason? American collectors shell out $400 per bird. They cost less than $30 each in Vietnam.

In other bird smuggling news, over at Baltimore-Washington International Airport, customs officers discovered that a Nigerian passenger was carrying a souvenir pigeon head concealed in some homemade soap. (HT @noahwilliamgray.)

More bird smuggling stories? Post 'em in the comments.

Cute Animal vs. Global Warming

| Wed May 6, 2009 3:30 PM EDT

The Fish and Wildlife Service said today that it will launch a year-long review to see if the American Pika is endangered by global warming. The American Pika is a small, furry, rabbit-related mammal whose habitat and range, conservationists say, has been severely restricted by global warming. The pika, not to be confused with the jerboa or Pikachu, lives in cold, mountainous regions of the Western US. As those foothills and mountains have warmed, the pika has been forced to make its home in higher elevations. Problem is, there's a limit to how high they can go: the higher the elevation, the smaller the habitat.

If the pika receives endangered status next year, it will be the first mammal in the lower 48 states to receive protection due to global warming. The pika might make a great mascot against global warming. It's small, furry, cute, has big ears and shiny eyes... to further the cuteness factor, the pika communicates with "whistles" and actually gathers wildflowers to nibble on. Take that, polar bears.

Mahmood Karzai Defends Brother's "Warlord" VP Pick

| Wed May 6, 2009 3:29 PM EDT

A few days before departing Afghanistan for his meeting Wednesday in Washington with President Obama, Hamid Karzai announced the second of his two vice presidential picks: Mohammad Qasim Fahim, former leader of the militant group Jamiat-e-Islami. Fahim is a deeply controversial figure accused of numerous human rights violations during his time as a militia commander during the Afghan civil war. Human Rights Watch says that, by picking him, Karzai is "insulting the country." In 2005, the group put out a report called "Blood-Stained Hands," (.pdf) which found "credible and consistent evidence" that Jamiat-e-Islami had been involved in "widespread and systematic human rights abuses and violations of international humanitarian law."

Fahim previously served as Afghanistan's vice president in the years immediately following the 2001 US invasion, but was ousted by Karzai in 2004 in favor of Ahmad Zia Massood, brother of the slain Afghan commander Ahmad Shah Massood, assassinated by Al Qaeda just days before 9/11. Why the Afghan president has decided to resuscitate Fahim's political career was among the questions I posed Wednesday to Karzai's brother Mahmood, who spoke with me by phone from Afghanistan. He defended his brother's VP choice, describing Fahim as a true Afghan patriot. Some edited excerpts from our conversation:

Quote of the Day - 5.6.09

| Wed May 6, 2009 2:38 PM EDT

From Governor John Baldacci of Maine, after signing a law allowing same-sex marriage:

"In the past, I opposed gay marriage while supporting the idea of civil unions.  I have come to believe that this is a question of fairness and of equal protection under the law, and that a civil union is not equal to civil marriage."

Good for him.  But I wonder if this is an example of how gay marriage opponents are going to end up losing this battle entirely when they could have won at least a partial victory if they'd been less strident in their opposition.  If they had actively supported civil unions, that could have become the de facto standard across the country, accepted by courts and legislatures alike.  But the ferocity of their opposition to any form of marriage equality might have been instrumental in convincing a lot of people like Baldacci that half measures are impossible.  And if half measures are impossible, then full marriage rights are the only alternative.

In the long run, maybe none of this matters.  But in the medium term, marriage opponents have adopted an attitude of such extreme intolerance that fewer and fewer people want anything to do with them.  And with that, the cultural battle was lost.