• Quote of the Day


    From Alex Knapp, who says that being imprisoned for a crime you didn’t commit isn’t the worst injustice you can suffer after all:

    Now I’ve learned that there is something worse that can happen. You can be accused of a crime you didn’t commit, then have the government that imprisoned you acknowledge that yes, you are innocent — but they’re going to keep you in prison anyway.

    He’s talking about the 17 Uighurs who continue to be held at Guantanamo Bay despite the fact that they were clearly brought there in error and have never conspired against the United States in any way.  The Obama administration acknowledges this, but continues to argue in court that it has no obligation to release them anyway.  Not exactly a profile in courage.

  • Mighty Suburbia

    As a replacement for race-based affirmative action, Texas started a program ten years ago that guaranteed admission to the University of Texas to the top ten percent of all high school classes.  As a result, more kids from rural and inner city schools were admitted to UT Austin, the system’s flagship campus.  Hooray!  But not everyone was thrilled by this:

    For six years [] an odd coalition of lawmakers from the inner cities and rural towns had beaten back efforts to weaken the program….That coalition finally cracked this year under pressure from suburban factions in the Legislature and after heavy lobbying by university officials, who vowed to recruit minorities aggressively.

    ….Senator Rodney Ellis, a Houston Democrat, [] fought the change….The bill, Mr. Ellis said, was a victory for suburban students.

    “The very people who make the most noise about this are the parents of kids who have had all the advantages in life,” he said. “They are the same people who don’t give a tinker’s damn about the people in the quote other schools unquote.”

    But Senator Florence Shapiro, a Republican from Plano who sponsored the legislation in the Senate, said students from good suburban high schools had a legitimate complaint. Only class rank is taken into account, not extracurricular activities or other talents. Many students have been attending colleges out of state.

    “The pressure for this bill,” Ms. Shapiro said, “really comes from the suburban counties where the youngsters do really well and many times are in the top 13 percent and cannot go to the university. They really go all over the country when they don’t have opportunity here.”

    Never underestimate the power of suburban parents.  They never give up and they never surrender.

    (Via Matt Yglesias.)

  • Extreme Charter

    The LA Times has an interesting read today about the American Indian Public Charter schools in Oakland, which are some of the highest performing schools in the state of California:

    Not many schools in California recruit teachers with language like this: “We are looking for hard working people who believe in free market capitalism. . . . Multicultural specialists, ultra liberal zealots and college-tainted oppression liberators need not apply.”

    ….The Academic Performance Index, the central measuring tool for California schools, rates schools on a scale from zero to 1,000, based on standardized test scores. The state target is an API of 800….The oldest of the American Indian schools, the middle school known simply as American Indian Public Charter School, has an API of 967. Its two siblings — American Indian Public Charter School II (also a middle school) and American Indian Public High School — are not far behind.

    ….On Tuesday, American Indian’s high school will graduate its first senior class. All 18 students plan to attend college in the fall, 10 at various UC campuses, one at MIT and one at Cornell.

    ….The school could not provide its students’ elementary school test scores, so it is hard to say if they were [already above average when they were admitted]. Roberts did provide three years of middle school scores for all students who entered American Indian in 2004 (with names removed for privacy), showing their progress in math and English from sixth to eighth grade. Of the 51 students who entered American Indian’s middle school that year, only six scored lower than “proficient” in both math and English at the end of sixth grade.

    In a nutshell, this story explains pretty well why I like charter schools — and also why I doubt they’re any kind of educational panacea.  Lefty-baiting aside, AIPC is a super-strict, teach-to-the-test, no goofing off kind of place that apparently gets good results.  So I say: fine.  If there are some parents who want their kids to go to schools like this, let ’em.

    At the same time, AIPC is tiny: 51 students in middle school and 18 in its first graduating class.  It plainly attracts only parents and children who are academically motivated in the first place.  It requires middle school teachers to teach every subject and keeps them on a grueling pace, which means lots of turnover.  Cheerleaders to the contrary (“They really should be the model for public education in the state of California,” says Debra England of the Koret Foundation), the odds that the AIPC formula is scalable to an entire school district is nil.

    It makes sense to try out different kinds of schools for different kinds of kids and different kinds of neighborhoods.  With a few obvious caveats, I’m all for it.  But let’s not pretend that any particular one of these charters is necessarily the model for everyone else on the basis of 18 cherry-picked graduates.  It ain’t so.

  • Chart of the Day

    As I’ve mentioned before, one of the big problems with reaching peak oil isn’t just that oil prices will go up, but that they’re likely to spike up and down fairly violently.  In 2006, for example, demand for oil pretty much bumped up against the total available supply, which meant that even a small amount of additional demand was enough to send oil prices spiraling up past $150 in little more than a year.  The ensuing recession reduced demand by only a modest amount, but that was enough to cause oil prices to plummet to under $50 in the same timespan.  And this isn’t just a demand-side problem: a small glitch in supply could easily have caused the same kinds of violent price spikes.

    As a general rule, the world can handle high oil prices.  In fact, to the extent that high prices get us off our butts and looking for cleaner, more sustainable sources of energy, high oil prices are a good thing.  But what the world economy can’t handle is constant, huge gyrations in oil prices: nearly all of our recessions since 1973 have been jump started by a sudden spike in oil prices.

    So what happens next?  Via Ryan Avent, Paul Kedrosky points us to this projection from McKinsey, which shows that demand will once again bump up against supply very shortly: probably within a couple of years, but almost certainly within four years at the outside.  And when that happens, prices will once again rise unpredictably.  A strike in Venezuela could cause oil prices to double in less than a month.  A rumor of new supergiant field or a small recession could cause a subsequent collapse.  Price changes of 100% in short periods will become common.

    You can probably already figure out where this post is going, can’t you?  Wild spikes in oil prices are very bad news for the global economy, and the only way to avoid them is to permanently reduce global demand for oil so that we once again have enough spare pumping capacity to keep prices relatively steady — high and rising, perhaps, but at least rising fairly predictably.  That means we need higher mileage cars (global warming isn’t the only reason for stronger CAFE standards), electrification of transportation, better conservation and efficiency measures, and more investment in solar, wind, and biofuels.  And all this needs to be done fairly quickly if we want to avoid an economy permanently at the mercy of OPEC oil.  Even 2013 isn’t that far away.

  • The Battle for the Soul of Conservatism

    The nomination of Sonia Sotomayor to the Supreme Court raises a question: Who will win the battle for the conservative soul?  In the red corner, we have the insane wingnuts:

    Newt Gingrich: “White man racist nominee would be forced to withdraw. Latina woman racist should also withdraw.”  Rush Limbaugh: “How can a party get behind such a candidate? That’s what would be asked if somebody were foolish enough to nominate David Duke or pick somebody even less offensive.” Tom Tancredo: “She’s a member! She’s a member of La Raza!” Matthew J. Franck: “Is she still, and how much of La Raza’s politics does she make her own?” Michael Goldfarb: “Does anyone dispute that Sotomayor has been the recipient of preferential treatment for most of her life?”  Bill Bennett: “Did she get into Princeton on affirmative action, one wonders.” G. Gordon Liddy: “Let’s hope that the key conferences aren’t when she’s menstruating or something, or just before she’s going to menstruate.”

    And in the other red corner, we have an improbable band of rebels trying to urge conservatives to act like grownups:

    Peggy Noonan: “Newt Gingrich twitters that Judge Sotomayor is a racist. Does anyone believe that? He should rest his dancing thumbs, stop trying to position himself as the choice and voice of the base in 2012, and think.” Jon Cornyn: “This is not the kind of tone that any of us want to set when it comes to performing our constitutional responsibilities of advise and consent.” Julian Sanchez: “What we’re seeing here [] is people clinging to the belief that Sotomayor has to be some mediocrity who struck the ethnic jackpot, that whatever benefit she got from affirmative action must be vastly more significant than her own qualities, that she’s got to be a harpy boiling with hatred for whitey, however overwhelming the evidence against all these propositions is.  This is really profoundly ugly.” Michael Steele: “I know that a lot of folks want to do the knee jerk you know let’s start slammin’ and rammin’, but I think we really need to take a step back from this.” Charles Krauthammer: “What should a principled conservative do?….Nothing ad hominem. The argument should be elevated, respectful and entirely about judicial philosophy.”

    Who will win?  I guess we won’t know until Sarah Palin weighs in, will we?

  • Friday Cat Blogging – 29 May 2009

    I don’t know how well it shows up in the photo, but when they write the definition of “smug” in the next edition of Webster’s, they’re going to use this picture of Inkblot.  He was so pleased with himself he could hardly stand it.  On the right, we have an action shot of Domino darting out from behind the quilts to protect the house from an invasion of cat toys.

    And here’s our latest experiment in feline pyschology.  Last weekend Marian brought home a blue blanket and tossed it down in the entryway.  Inkblot made an immediate beeline for it and claimed it as his new favorite thing.  The next day we put the blanket up on the couch.  He wouldn’t go near it.  We put it on the carpet.  Ditto.  We put it on the carpet right next to the sofa, and he not only wouldn’t go near it, he actually circled way around it as if it were going to bite him.  So then, out of curiosity, I picked it up and put it back on the hardwood floor in the entryway.  He made an immediate beeline for it and curled right up.  Now what the hell is going on with that?

  • Yet More on Tough Talk

    Hillary Clinton says the Israeli settlements in the West Bank need to stop.  No outposts, no “natural growth,” no nothing.  But even if that’s the line coming from the Obama administration, surely Bibi Netanyahu can count on congressional pressure to show Obama who’s really boss?  Right?

    According to many observers in Washington and Israel, the Israeli prime minister, looking for loopholes and hidden agreements that have often existed in the past with Washington, has been flummoxed by an unusually united line that has come not just from Obama White House and the secretary of state, but also from pro-Israel congressmen and women who have come through Israel for meetings with him over Memorial Day recess. To Netanyahu’s dismay, Obama doesn’t appear to have a hidden policy. It is what he said it was.

    ….Whereas in the past Israeli leaders have sometimes eased pressure from Washington on the settlements issue by going to members of Congress, this time, observers in Washington and Israel say, key pro-Israel allies in Congress have been largely reinforcing the Obama team’s message to Netanyahu. What changed? “Members of Congress have more willing to follow the leadership of the administration … because [they] believe it is in our national security interest to move toward ending the conflict and that it is not a zero sum for Israel,” the former senior Clinton administration official said.

    That’s Laura Rozen over at Foreign Policy. Congress has always been a key part of Israel’s ability to fight off pressure from American presidents.  If that’s changing, it’s a big deal.

  • The White Man’s Burden


    Michelle Cottle is a racist, sexist hatemonger:

    Not to state the obvious, but an upper-middle class white guy reared in the suburbs is shaped by his experiences, carries certain assumptions, and views the world through a particular prism as much as a working-glass Puerto Rican gal from Queens, or, for that matter, the half-black son of a single mom raised in Hawaii. The person belonging to the cultural/ethnic/religious/gender/racial demographic that has traditionally dominated a field (and thus whose perspective has long been the default) may not have given as much thought to his prism as a member of a non-dominant group. But that does not make his prism a neutral one. It simply allows him to more freely indulge his delusions of pure rationality and objectivity.

    This is ridiculous.  It’s just a coincidence that opposition to affirmative action comes almost exclusively from white men.  Nothing to do with background at all.  Right, Rush?

  • Risk

    Economist Gary Gorton has written a 20,000 word paper on the subject of “informationally-insensitive debt” — i.e., ultra-safe investments like federally insured bank deposits.  Ezra Klein boils this down to a thousand words.  I boldly push the boundaries even further:

    The morons who inhabit Wall Street thought they had removed all risk from inherently risky investments.  They were wrong.

    There!  Twenty words.  That’s a compression ratio even greater than Ezra’s.  Felix Salmon comments:

    Gorton’s solution to this problem is to involve the government in all manner of regulation — and insurance — of the securitization market, thereby making [asset back commerical paper] behave much like federally-insured bank deposits. I don’t like this solution at all, since it would send the contingent liabilities of the government into the stratosphere, and more importantly would ratify the demand for informationally-insensitive assets by creating trillions of dollars of new ones.

    In my view of the crisis, it’s precisely the demand for informationally-insensitive assets which is the problem. And we need to get individuals, companies, and institutional investors out of the mindset that they can do an elegant little two-step around the inescapable fact that anybody with money to invest perforce must take a certain amount of risk. If you have a world where people are all looking for risk-free assets, you end up shunting all that risk into the tails. And the way to reduce tail risk is to get everybody to accept a small amount of risk on an everyday basis. We don’t need more informationally-insensitive assets, we need less of them.

    I agree.  There’s a common view that investors in the period up until 2006 were practically drunk on risk, pricing it nearly at zero — but now, after the crash, they’ve become more risk averse than your grandmother.  They’re almost completely unwilling to accept any risk at any price.

    I think this view is fundamentally wrong.  What really happened is that in the early part of the decade investors became convinced that they could avoid risk entirely via financial engineering.  They were, in fact, immensely risk averse, but this wasn’t obvious because they were buying up every security in sight.  The post-crash flight to quality, it turns out, wasn’t really a flight at all.  Modern investors have been afraid of risk all along.

    So Felix is right.  The last thing we need is for the government to perpetuate the delusion that financial markets are risk free.  For small retail bank depositors, that’s fine.  For the big boys it’s not.  They need to relearn the art of genuinely analyzing risk and taking it on knowingly, rather than pretending they can hedge it away under all circumstances.  After all, accurate analysis of risk is essential to the efficient allocation of capital, and efficient allocation of capital is one of the keys to economic growth.  It’s time for Wall Street to get back to basics.