Blogs

Bernanke on the Stimulus

| Tue Mar. 3, 2009 12:17 PM EST
Ben Bernanke's profile has been a little bit lower since Barack Obama took office, but today he testified before Congress and backed Obama's aggressive spending plans:

U.S. Federal Reserve Chairman Ben Bernanke on Tuesday appeared to back the White House's efforts to stimulate the economy, saying aggressive action is needed now to avoid an economic calamity even as it adds trillions of dollars in new government debt.

...."By supporting public and private spending, the fiscal package should provide a boost to demand and production over the next two years as well as mitigate the overall loss of employment and income that would otherwise occur," Mr. Bernanke said in prepared testimony to the Senate Budget Committee.

Basically, Bernanke had nothing good to say about our current mess.  Things are bad and getting worse.  Interestingly, however, he did have one slightly encouraging thing to say about the long-term deficit: he thinks it will be mitigated somewhat when we start selling off all the toxic waste that we're buying up right now. "If all goes well," he said, "the disposition of assets acquired by the Treasury in the process of stabilization will be a source of added revenue for the Treasury in the out years."

If all goes well, that might be true.  I wonder what the odds are of all going well?

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Barry Manilow as a Weapon of Mass Destruction

| Tue Mar. 3, 2009 11:45 AM EST

Barry Manilow, the coiffed, ever-young hero of blue-haired old ladies the world over, could live to see his music transformed from drunken pub fare into the newest innovation in crowd control, according to the Associated Press. A shopping mall in the New Zealand city of Christchurch is reportedly having trouble with juvenile delinquents spreading trash, getting drunk, getting high, tagging walls with spray paint, and talking filth to local shoppers. The solution? Pipe in hits like "Mandy" and "Can't Smile Without You," which, like this obnoxious tone said to be the scourge of teenage ruffians everywhere, will (it is hoped) clear the area of smack-talking punks. Paul Lonsdale, manager of the local business association, denies that Manilow was selected to drive teenagers crazy. "The intention is to change the environment in a positive way... so nobody feels threatened or intimidated," he says. "I did not say that Barry Manilow is a weapon of mass destruction."

No, for that look to some other acts, like the Red Hot Chili Peppers, which the CIA used to bully Al Qaeda leader Abu Zabaydah into spilling his beans (along with other forms of "enhanced interrogation"). We should also not forget that Van Halen, Whitesnake, and Black Sabbath, among others, ultimately convinced Panamanian strongman Manuel Noriega that he'd rather spend the rest of his life in a federal supermax than sit through another minute of "War Pigs."

Will such tactics work on Christchurch's problem children? Doubtful if we believe 16-year old Emma Belcher. "We would just bring a stereo and play it louder," she told the AP.

Photo used under a Creative Commons license from Alan Light.

A Deal With Russia?

| Tue Mar. 3, 2009 2:31 AM EST
Peter Baker of the New York Times reports on the latest diplomatic move from Barack Obama:

President Obama sent a secret letter to Russia’s president last month suggesting that he would back off deploying a new missile defense system in Eastern Europe if Moscow would help stop Iran from developing long-range weapons, American officials said Monday.

....The officials who described the contents of the message requested anonymity because it has not been made public. While they said it did not offer a direct quid pro quo, the letter was intended to give Moscow an incentive to join the United States in a common front against Iran.

....The officials who described the contents of the message requested anonymity because it has not been made public. While they said it did not offer a direct quid pro quo, the letter was intended to give Moscow an incentive to join the United States in a common front against Iran.

I'm not sure what to make of this.  The story shows every sign of being an official leak, something that Obama wanted to make public prior to Hillary Clinton's meeting with the Russian foreign minister later this week.  But does making it public really help its chances of being accepted?  Doesn't seem like it.  Or perhaps the leak was designed more to put pressure on Iran than it was to put pressure on Russia?

Very odd.  Consider me mystified by this.

12,000 Climate Activists Can't Be Wrong

| Tue Mar. 3, 2009 1:44 AM EST

Ah, the party planner's problem. You send out an invitation, and what happens if they all say yes? 

I'm just back from today's magnificent civil disobedience outside the Capitol power plant. It began around 1 p.m., with the morning's snow still swirling—and out of the snow hundreds and then thousands of people arriving, signs in hand, many wearing green hardhats, all ready to go for a march. And what a march—down a few blocks off Capitol Hill into a strange semi-wasteland of overpasses, newly built luxury condos now unoccupied in the housing bust—and a big ugly power plant.

We marched a lap around the complex, dropping off color-coded contingents at each of the five gates—green flags with several hundred people at the first, red at the second. The mass of us gathered outside the main gate, before a small stage, and then listened to half the most important folk in the environmental movement, from Gus Speth to Wendell Berry to young indigenous activists to some guy named Jim Hansen. Cheering, singing, dancing, shivering.

The only problem was, too many people. We simply overwhelmed the police, who were prepared to arrest 500 but not ten times that many. And so they simply refused. Short of actually assaulting cops, which no one had the slightest interest in, it was simply impossible to get arrested. We were all risking it—we were standing where we weren't supposed to for hours on end. And we shut down the plant for the afternoon.

Not only that, of course, but since Nancy Pelosi and Harry Reid had actually caved in last week, announcing they'd end 103 years of burning coal in the plant and convert it to natural gas, there was no obstacle to declaring victory, utter and complete. 

I was the slightest bit disappointed, because I'd looked forward to eating out for a long time on the story of sharing a cell with Berry and Hansen and Terry Tempest Williams and Janisse Ray and Kathy Mattea and all the other good folks who were out there standing their ground. It would have been one hell of a stretch behind bars, and we could have written some kind of great letter from jail. 

But much better to see the wide smiles on the faces of the thousands of college kids who made up much of the crowd. The kind of wide smiles that come with saying: 'so this is how it works.' It's not impossible. All it takes is a movement, which now we've got to build.

Oops

| Mon Mar. 2, 2009 10:56 PM EST
We're still waiting for the release of many of the Bush-era legal opinions that were used to justify warrantless wiretapping, torture, and indefinite detention.  Today we got to see a few of them, including a remarkable memo written by George Bush's own Office of Legal Counsel during the final week of his presidency:

In a memo written five days before President Barack Obama took office, Steven Bradbury, the then-principal deputy assistant attorney general, warned that a series of opinions issued secretly by the Justice Department's Office of Legal Counsel "should not be treated as authoritative for any purpose."

The memo, unusual for its critique of a current administration's legal opinions, was released by the Justice Department Monday along with eight other previously secret opinions.....Attorney General Eric Holder said Monday that he planned to release as many of the Bush administration's OLC memos and opinions as possible "while still protecting national security information and ensuring robust internal executive branch debate and decision-making."

The full memo, written on January 15, is here, and retracts nine separate opinions from the Yoo/Bybee/Haynes era at the OLC.  In particular, it turns out that one of the early Yoo opinions made the risible argument that the FISA act didn't apply to Bush's warrantless wiretap program because the text of FISA didn't specifically say it applied to national security matters.  The January memo calls this "problematic and questionable, given FISA's express references to the President's authority."  Orin Kerr at the Volokh Conspiracy is more scathing:

If I'm reading this correctly, then, the original Yoo memos on the TSP had argued that FISA didn't apply because there was nothing in the statute that indicated clearly an intent to regulate national security surveillance. This would have been an extremely lame analysis, though....It's hard to read the phrase "procedures in . . . the Foreign Intelligence Surveillance Act of 1978 shall be the exclusive means by which electronic surveillance . . . may be conducted" as not clearly indicating an intent to regulate electronic surveillance in the national security area. Indeed, much of the point of FISA was to regulate that.

If I'm reading this correctly, it might explain why Senators Feinstein & Specter introduced legislation back in '06, at the height of the legal controversy over the TSP, that would "re-state" that FISA was the exclusive means for national security surveillance. A lot of people giggled at this idea at the time: Why restate what Congress already said? However, if the Bush Administration at some point indicated to Specter and Feinstein what the reasoning was of the initial OLC memos, Feinstein and Specter would have known something we didn't. "Re-stating" the point in new legislation could have been designed to provide the "clear statement" that the Yoo memo argued was necessary.

It's hard to believe that even John Yoo seriously advanced this argument.  Given the plain text of the FISA statute, it simply can't be made in good faith.  But he did.

The Horseshoe Crab Economy

| Mon Mar. 2, 2009 8:14 PM EST
It's also a global economy that affects millions. Notably, millions of little shorebirds known as red knots, whose numbers have declined 75 percent since the horseshoe crab fishery in Delaware Bay exploded. Prior to 1992, 100,000 crabs a year were caught. In 1997, more than 2 million. The result: 90 percent fewer crab eggs for visiting shorebirds to eat.

Here's the background: A lot of migrating shorebirds depend on Delaware Bay as a feeding stop. Red knots can't live without it. Until 1992 the Bay was a dependable fuel station on their annual 18,600-mile migration between the Arctic and the southern tip of South America and back. That's right, 18,600 miles a year. Fifty percent more flying than the average American drives per year. All from a bird weighing 6 ounces.

Now a new study has found the proportion of red knots visiting Delaware Bay who manage to pack on enough weight to survive the winter in Tierra del Fuego dropped along with the crab eggs. In fact the proportion of birds who made their target weight by their target departure date declined between 50 and 75 percent between 1997 and 2007.

This despite fisheries restrictions enacted in 1997 to help red knots recover. But, tell me, what kind of restrictions allow a 2007 horseshoe crab hunt bigger than the 1990 hunt?

Idiot restrictions. I wrote about other amazing long-distance fliers in Diet for a Warm Planet: how their thriftiness equals their prosperity. We all need to learn from these extraordinary feathered economists. Especially those who practice idiot economics.

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Red States Love Porn

| Mon Mar. 2, 2009 6:21 PM EST

They're red from all the chafing! In the latest installment of Irony and Hypocrisy Weekly, a study has shown that traditionally conservative states consume the most online pornography. Okay, the study (pdf link) was actually in the Journal of Economic Perspectives, and it looked at zip codes of credit cards used for "online adult entertainment" between 2006 and 2008. Researchers found that Utah led the way in sexy interweb fun times, with 5.47 subscribers per 1000 broadband users, followed by Alaska and Mississippi. Out of the top ten porn-using states, only Hawaii and Florida voted for Obama in the 2008 elections, and I think Hawaii is excused because they're so far away from, you know, actual sex with people they don't live next door to. Of course, one could also ascribe the higher online porn usage rates in red states to the simple fact that these states have often made in-person porn buying more difficult, but I prefer to think of it as another example of Larry Craig Syndrome: those who doeth protest too much are at home having a wanketh.

Researchers also found "marginally" higher porn subscription rates in the 27 states that had (at that time) passed anti-gay marriage laws, and in states where surveys show conservative positions on sexuality and gender roles. But in a boon to church-goers, there was also a slight dip in porn subscriptions on Sunday, although the oh-so-cynical researchers noted that this meant only that these people "shift their consumption of adult entertainment to other days of the week." Note to self: promote online porn company more aggressively on Saturdays and Mondays.

China Cancels Oasis Gigs Over "Free Tibet" Show

| Mon Mar. 2, 2009 5:52 PM EST

Wow, China never forgets, huh. Beatlesy British combo Oasis have had their first ever shows in the People's Republic of China canceled after the Chinese government revoked their performance licenses. The band's management issued a statement saying the decision "has left both Oasis and the promoters bewildered." But, according to Billboard magazine, band member Noel Gallagher had a deep, dark secret:

According to the promoters, officials within the Chinese Ministry of Culture only recently discovered that Noel Gallagher appeared at a Free Tibet benefit concert on Randall's Island in New York City in 1997. Consequently, Oasis is considered unsuitable to perform in the People's Republic of China during its 60th anniversary year.

If only it was just their 59th, right?

After the jump, a video from the band's most recent album, the underrated Dig Out Your Soul.

Want a Second Home for the Price of a Scooter? Try Detroit

| Mon Mar. 2, 2009 4:45 PM EST

In a Chicago Tribune article about the 15 (!!) people who are seeking to become Detroit's mayor, there is this little nugget:

The median price of a home sold in Detroit in December was $7,500, according to Realcomp, a listing service.

Not $75,000. Remove a zero—it's seven thousand five hundred dollars, substantially less than the lowest-price car on the new-car market

The city's bond rating is now at junk status, and when one mayoral candidate was asked to explain a 14 percent drop in the murder rate, he said, "I don't mean to be sarcastic, but there just isn't anyone left to kill." What a charming town.

The Dynamic Duo

| Mon Mar. 2, 2009 3:41 PM EST
David Cho of the Washington Post reports that Larry Summers and Tim Geithner have become outsized voices on Obama's economic team. A few weeks ago, for example, they teamed up to keep Obama focused on the long-term deficit:

Meeting in January on the eighth floor of the transition team's office in downtown Washington, Geithner pressed the incoming president to commit to cutting the deficit to 3 percent of the economy over the next five years, which would keep the nation's debt roughly in line with normal economic growth. Summers quickly backed him.

Some, including economist Jared Bernstein, resisted, saying that such a strict limit would make it more difficult to confront the many challenges ahead and that the size of the government's emergency response to the economy and financial markets would make the cap tough to maintain.

In February, the entire economic team convened in the windowless Roosevelt Room in the White House. Obama abruptly ended the debate. Geithner and Summers would have their way.

Tim Fernholz says "this doesn't sound too good," but I think that's too quick a judgment.  Bernstein may have lost this battle, but he wasn't shut out of the conversation, and in any case it's a battle he probably deserved to lose.  The long-term deficit is important, both in substantive and optical terms.  Substantively it's important because it's related to the current account deficit, which eventually needs to start coming down.  We can't keep borrowing from China forever.  And optically it's important because Obama needs to appear fiscally responsible if he wants to achieve his long-term goals.  So far Republicans haven't been able to make the "wasteful spending" charge stick, but if they ever get any traction with it the public is likely to start turning against Obama's plans.  One way to keep that from happening is for him to take economic fundamentals seriously and to make sure the public knows he's taking them seriously.

If the Bernstein faction starts to lose every battle, then that's a problem.  But it's only been a few weeks so far, and I suspect that he's going to win a few on some other issues.  But Obama did the right thing this time.