The Wall Street Journal goes page one with a misleading story about gold, splashing this headline across four columns atop the page:
Gold Vaults to New High
Gold hit $1,306 an ounce yesterday, which is a nominal record. Emphasis on nominal. That doesn’t mean anything, really. The real record was set thirty years ago at $2,318 in 2010 dollars. The Journal, incredibly, doesn’t mention this once in its story. This isn’t just an institutional knowledge failure, it’s one of numeracy.
With rare exceptions, inflation-adjusted prices should always be considered the baseline when you're reporting on trends. I know that it can make for clumsy writing, but that's life. It's the right thing to do, and nominal prices should be the ones in parentheses if you need to include them. Adjusted for inflation, gold peaked 30 years ago at a daily fix of about $2,300 and a monthly average of about $1,800. We're still quite a ways from that record.
However, this is an excuse for me to ask about something else: what is the deal with gold, anyway? I understand that historically it responds to panics, which explains why gold prices have been rising for the past couple of years. But why did it double between 2001 and 2008? Those were nice, low-inflation times, not the kind of environment that's usually friendly to gold bugs. What's the story here?
UPDATE: Via comments, a reminder that not everything is about us. China deregulated gold ownership in 2001, and since then demand in both China and India has boomed. So perhaps that's (part of) the answer.
I am not a lawyer, but it seems clear to me that the state of our law is such that anybody with sufficient legal training can make a reasonably strong-sounding argument for any policy he chooses, and that if his argument is wrong, it is likely to be wrong in ways that are non-obvious....So, set aside the legal questions for a second. The Awlaki case speaks to something even more fundamental than law: Decent nations do not permit their governments to assassinate their own citizens. I am willing to give the intelligence community, the covert-operations guys, and the military proper a pretty free hand when it comes to dealing with dispersed terrorist organizations such as al-Qaeda and its affiliates. But citizenship, even when applied to a Grade-A certified rat like Awlaki, presents an important demarcation, a bright-line distinction in our politics.
....If Awlaki were to be killed on a battlefield, I’d shed no tears. But ordering the premeditated, extrajudicial killing of an American citizen in Yemen or Pakistan is no different from ordering the premeditated, extrajudicial killing of an American citizen in New York or Washington or Topeka — American citizens are American citizens, wherever they go. I’m an old-fashioned limited-government guy, and I am not willing to grant Washington the power to assassinate U.S. citizens, even rotten ones.
Actually, I'd like to know if the Obama administration really does believe that it has the authority to assassinate U.S. citizens in Washington or Topeka in the same way it believes it has the authority to assassinate them in Sanaa and Karachi. And if not, why not?
Unfortunately, they've declared the entire thing to be a state secret, so we'll never find out. But as far as any of us are allowed to know, their official stand is that the entire world is a battlefield in the war against terrorism, and therefore killing terrorists is fair game anywhere in the world. Even if Williamson is right that a good lawyer can defend pretty much any proposition, I'd sure like to see the legal justification for that. At a bare minimum, you'd think that in a free democracy we'd all have the right to hear at least that much.
When I mentioned Beck’s name to several Fox reporters, personalities and staff members, it reliably elicited either a sigh or an eye roll. Several Fox News journalists have complained that Beck’s antics are embarrassing Fox, that his inflammatory rhetoric makes it difficult for the network to present itself as a legitimate news outlet.
Look, I'm willing to blame Glenn Beck for a lot of things. But making it difficult for Fox to present itself as a legitimate news outlet? That's a bridge too far. You really can't tie that one around Beck's neck, folks.
Well, we have another nanny scandal in California. Meg Whitman's former nanny and housekeeper, Nicky Diaz Santillan, now represented by Gloria Allred, says she worked for Whitman for nine years, during which she was "exploited, disrespected, and humiliated." Her story: she was hired in 2000 and was never asked if she was here illegally. But she claims Whitman knew her status and received multiple letters from the Social Security Administration asking about it, none of which she responded to. Instead, she told Diaz to "check on this" but never did anything further. Then, in June 2009, when Diaz asked Whitman to help her legalize her status, she was fired. She believes it was because Whitman had announced her run for governor and could no longer afford to employ an undocumented worker.
Ben Smith reports that Whitman agrees on the broad outlines of the story, but says she was deceived by Diaz and never knew her status. She fired Diaz only after she found out. So far this story is pretty sketchy on both sides, so stay tuned.
Diaz's actual legal claim, by the way, is for wages that she claims she wasn't paid during her employment. Obviously, though, the damage to Whitman is primarily the accusation that she knowingly employed an undocumented worker.
Celebrated filmmaker Arthur Penn, best known for his watershed 1967 film Bonnie and Clyde, died on Tuesday night at the age of 88. Here's the trailer for Penn's magnum opus:
In addition to his film direction, Penn was a pioneer of live television drama and directed a number of works for the stage, including The Miracle Worker with Anne Bancroft and Patty Duke. But he made his mark outside of the entertainment world as well, advising then-Senator John F. Kennedy during his televised debates with Richard Nixon in 1960. Penn directed the broadcast of the third debate. Dave Kehr of The New York Timeswrites that Penn instructed Kennedy to "look directly into the lens of the camera and keep his responses brief and pithy"—a strategy that allowed JFK to project an air of confidence that Nixon couldn't muster.
Of Bonnie and Clyde, Kehr says:
In Mr. Penn’s hands, it became something even more dangerous and innovative — a sympathetic portrait of two barely articulate criminals, played by Mr. [Warren] Beatty and a newcomer, Faye Dunaway, that disconcertingly mixed sex, violence and hayseed comedy . . . Not only was the film sexually explicit in ways unseen in Hollywood since the imposition of the Production Code in 1934 — when Bonnie stroked Clyde’s gun, the symbolism was unmistakable — it was violent in ways that had never been seen before. Audiences gasped when a comic bank robbery climaxed with Clyde’s shooting a bank teller in the face with a shotgun, and were stunned when this attractive outlaw couple died in a torrent of bullets, their bodies twitching in slow motion as their clothes turned red with blood.
It's still stunning, particularly given the unfrenzied pace of the scenes that directly precede it. Even though you know these two had it coming, you're still somehow caught unaware when it comes. The movie's bullet-ridden, kinetic sexiness presented a startlingly simple formula for instant success.
But what gives the movie its lasting appeal is its glorification of the anti-hero. Bonnie and Clyde blaze through the movie kiilling people and taking their money, with no regrets. They laid the cinematic groundword for the hippy bikers of Easy Rider, Travis Bickle of Taxi Driver, One Flew Over the Cuckoo's Nest's Randall Patrick McMurphy, and others. Tony Soprano, Al Swearengen, Omar Little, and Walter White—Bonnie and Clyde's influence on the TV renaissance of the late-1990s and 2000s is unmistakable. Our small-screen antiheroes make ugliness something to celebrate rather than shame. It's the same thoroughly modern idea that Penn blasted across the screen in 1967.
Here's part 2 of a series of fascinating interviews with Penn, focusing on his television career:
Tyler Cowen on problems with the theory underlying contemporary Keynesian economics:
Aggregate demand macroeconomics works in many cases and it almost always "works" (predicts well) when the macro forces are pointed toward destructive ends. We are not sure why it works at all, or if it always works, and yet we see a great fervor of belief in it and a demonization of those who are skeptics.
Am I misunderstanding this? Right now macro forces are indeed pointed toward destructive ends, aren't they? So if AD macro almost always works in those cases, doesn't a great fervor of belief in it make sense even if we're not 100% sure why it works?
The Associated Press reports that the Department of Justice may be seeking to cut a deal with BP over fines resulting from the Gulf spill rather than hashing it out in court. The AP's main source is the office of Rep. Steve Scalise (R-La.), which says it as tipped off via their work on a spill-response bill.
A DOJ official tells Politico there's no deal in the works. But, deal or no deal, how the department handles this issue is crucial, as there is a huge amount of money at stake.
The question right now is whether the DOJ will make the case that it was BP's negligence that led to the explosion and subsequent spill. Here's why that matters: fines for Clean Water Act violations begin at $1,100 per barrel spilled and jump to $4,300 per barrel if the company is deemed negligent. If DOJ settles with BP, the company would likely fork over the cash faster, whereas seeking the higher penalty would almost inevitably result in protracted legal wrangling. But when you consider that an estimated 4.9 million barrels of oil were dumped into the Gulf over the course of the spill, the difference between those two penalties could really add up. Based on the Justice Department's conclusion, BP could face anywhere from a $5.4 billion to $21 billion fine.
This becomes even more relevant this week, since on Tuesday former Mississippi governor and Navy Secretary Ray Mabus, who Obama tapped to lead the Gulf recovery planning effort, recommended that the money go directly to the region to cover both short- and long-term restoration efforts (as the Gulf coast was already facing quite a few environmental challenges before the spill). Under current law, the revenue from those Clean Water Act fines is supposed to go into the Oil Spill Liability Trust Fund to cover future oil spill cleanups. But the Mabus report recommends that Congress pass a new law to direct a "significant amount of any civil penalties" to a new fund, and create a Gulf Coast Restoration Council that would determine how best to spend that money. The report also endorsed sending some of the funds directly to the states to support their restoration efforts.
The Obama administration endorsed the recommendations of the Mabus report yesterday, but whether Congress will take action is anybody's guess. Scalise and other Gulf state legislators, including Democratic Sen. Mary Landrieu of Louisiana, are lobbying for a change that would devote 80 percent of that money directly to impacted states. How the DOJ decides to approach the fines will make a huge difference in how much money there is to fight over.
Bob Somerby on the widely-reported Pew poll showing that most people don't know much about either their own religion or anyone else's:
Can we talk? We the people always turn out to be “deeply ignorant,” on any information survey. In response, major broadcasters feign surprise. It’s how such things are done.
My favorite, as longtime readers know, is the annual geography survey that always produces howls of indignation. 70% of high school kids don't know where France is! 80% can't find Kansas City on a map!
Of course, no one ever bothers testing adults, who would probably do just as poorly. Just as they do poorly on surveys of American history, constitutional knowledge, current events, and everything else. Most of us just don't know very much about anything.
And least of all about complicated legislative proposals. A couple of days ago I linked to an AP poll that asked people what they thought about healthcare reform. I decided to devote my post to the question of whether a more liberal proposal would have been more popular (almost certainly not), which didn't leave room to talk about a long series of questions AP asked about the legislation itself. Basically, they wanted to find out what people knew about the law, and the answer is: meh. Of the true items AP mentioned, 69% thought they were part of the law. Of the made-up items, 37% thought they were part of the law. Not bad, I guess (and note that these numbers assume that I know which items were right and which were wrong), but it's still the case that 20% of the country thinks you'll have to disclose major diseases to your employer, 30% think the law requires insurance companies to charge smokers an extra $1,000, 40% think death panels will be empowered to pass judgment on individual treatment, and 50% think the law requires doctors to treat illegal immigrants.
Now where do you think so many people could have gotten these ideas? It's not just simple ignorance at work, though that's certainly part of it. It's the noise machine. If you listened to Rush and Sean and Sarah and Glenn and Drudge all day, you'd probably believe most of this stuff too. And you'd oppose the law. Who wouldn't?
Alaska's Democratic Senate candidate Scott McAdams, who we profiled here last month, is up with his first ad, which touts his deep ties to the state. It's probably the first political ad to brag about being cursed at in Norwegian. I'd also venture that it's the first to feature a candidate dressed in a hoodie.
"This is a long way from DC," he says in the ad. He continues: "I'm not your usual Senate candidate."
McAdams' candidacy got a whole lot more exciting a few weeks ago, as tea-party candidate Joe Miller defeated incumbent Republican Lisa Murkowski in the primary. Then Murkowski decided to launch a write-in campaign, spicing things up further. The latest poll shows McAdams behind both his opponents; Miller at 42 percent, Murkowski at 27, and McAdams at 25. But Murkowski's bid relies largely on making sure people know how to spell her last name—which is apparently more difficult than it seems.
But McAdams might have more of a shot than the top line poll numbers show right now. The same poll found that 18 percent of likely voters in the state said they were "nor sure" yet what they think of McAdams. (Only 4 percent said the same of Miller and 2 percent said that about Murkowski.) This is his first ad in the state, which means more Alaskans could be getting to know McAdams in the coming weeks.