Archive for the ‘Mental Irrationality’ Category

The Wealth Gap – Inequality in Numbers

Tuesday, January 17th, 2012

Until protesters took to the streets last year, first in New York and then in financial centres across the world, inequality had been a low-key issue.

Not any more.

With the political temperature rising, a stream of new analysis is revealing how sharply inequality has been growing.

In October, the US Congressional Budget Office (CBO) caused a storm by revealing how big a slice of income gains since the late 1970s had gone to the richest 1% of households.

The message was dramatic.

Over the 28 years covered by the CBO study, US incomes had increased overall by 62%, allowing for tax and inflation.

But the lowest paid fifth of Americans had got only a small share of that: their incomes had grown by a modest 18%.

Middle income households were also well below the overall average with gains of just 37%.

And even the majority of America’s richest households saw gains of barely above the overall average at 67%.

How does that make sense?

Because the CBO found most of the income gains over the past 30 years had gone to the top 1% of US households. Their incomes had almost trebled with rises of 275%.

– More…


Climate change and craving a cause

Monday, December 19th, 2011

I read this and I think it explains a lot about why folks don’t believe in climate change and why they seem to go for anything and everything that runs against convential wisdom.

I, myself, think there’s a lot that’s bogus and unreliable in the information that surrounds us but I also think that I’m picking and choosing what to accept and what to reject based on reasonable grounds rather than on a one-size-fits-all type of reaction.

Directors’ pay rose 50% in past year, says IDS report

Sunday, October 30th, 2011

Pay for the directors of the UK’s top businesses rose 50% over the past year, a pay research company has said.

Incomes Data Services (IDS) said this took the average pay for a director of a FTSE 100 company to just short of £2.7m.

The rise, covering salary, benefits and bonuses, was higher than that recorded for the main person running the company, the chief executive.

Their pay rose by 43% over the year, according to the study.

Prime Minister David Cameron, speaking in Australia, said the report was “concerning” and called for big companies to be more transparent when they decide executive pay.

Labour leader Ed Miliband said the pay increases were part of a “something for nothing” culture, since the stock market had not risen to match them.

A statement from IDS said that that figure suggested that “executive largesse is evenly spread across the board”.

Base salaries rose by just 3.2%, although that was above the median rise recorded by IDS this week for average pay settlements of 2.6% for private sector workers.

The latest consumer price inflation figures showed inflation at 5.2%.

– More…


Where child sacrifice is a business

Wednesday, October 12th, 2011

– Superstitions and destructive cultural practices are among the worst aspects of humanity.   This story is really sad.  I have a hard time sharing the planet with people like this.  And I’ll let you guess, dear reader, who I think should go.

– dennis

= = = = = = = = = = = = = = = = = = = =

The villages and farming communities that surround Uganda’s capital, Kampala, are gripped by fear.

School children are closely watched by teachers and parents as they make their way home from school. In playgrounds and on the roadside are posters warning of the danger of abduction by witch doctors for the purpose of child sacrifice.

The ritual, which some believe brings wealth and good health, was almost unheard of in the country until around three years ago, but it has re-emerged, seemingly alongside a boom in the country’s economy.

The mutilated bodies of children have been discovered at roadsides, the victims of an apparently growing belief in the power of human sacrifice.

‘Sacrifice business’

Many believe that members of the country’s new elite are paying witch doctors vast sums of money for the sacrifices in a bid to increase their wealth.

At the Kyampisi Childcare Ministries church, Pastor Peter Sewakiryanga is teaching local children a song called Heal Our Land, End Child Sacrifice.

To hear dozens of young voices singing such shocking words epitomises how ritual murder has become part of everyday life here.

“Child sacrifice has risen because people have become lovers of money. They want to get richer,” the pastor says.

“They have a belief that when you sacrifice a child you get wealth, and there are people who are willing to buy these children for a price. So they have become a commodity of exchange, child sacrifice has become a commercial business.”

The pastor and his parishioners are lobbying the government to regulate witch doctors and improve police resources to investigate these crimes.

– more…


Chickening Out in Iraq

Monday, October 3rd, 2011

– Another article (see also:  & ) about how the taxes of U.S. citizens are wasted.   Unbelievable, really.

– dennis

– – – – – – – – – – – – – – – – – – – – – – – –


Who doesn’t like roasted chicken? Fresh, crispy with a little salt, it falls off the bone into your mouth. It’s a great thing, unless the price is $2.5 million of your tax dollars.

As a Foreign Service Officer with a 20-year career in the State Department, and as part of the George W. Obama global wars of terror, I was sent to play a small part in the largest nation-building project since the post-World War II Marshall Plan: the reconstruction of Iraq following the American invasion of 2003. My contractor colleagues and I were told to spend money, lots of money, to rebuild water and sewage systems, fix up schools, and most of all, create an economic base so wonderful that Iraqis would turn away from terrorism for a shot at capitalism. Shopping bags full of affirmation would displace suicide vests.

Through a process amply illustrated below, in my neck of rural Iraq all this lofty sounding idealism translated into putting millions of dollars into building a chicken-processing plant. It would, so the thinking went, push aside the live-chickens-in-the-marketplace system that Iraqis had used for 5,000 years, including 4,992 years without either the Americans or al-Qaeda around. It did not work, for all sorts of reasons illustrated in the story below. We did have great ambitions, however, and even made a video to celebrate opening day. Don’t miss the sign at the very the beginning thanking us Americans for “the rehabilitation of [the] massacre of poultry.” We sure paid for the sign, but the quality of the proofreading gives you an idea of how much thought went into the whole affair.

If the old saying that there is nothing more frightening than ignorance in action is true, you should be terrified after reading this excerpt from my new book, We Meant Well: How I Helped Lose the Battle for the Hearts and Minds of the Iraqi People. And keep in mind that it all happened on your dime.  What follows catches my experience of what was blithely called “reconstruction” in post-invasion Iraq.  I can assure you of one thing: the State Department isn’t exactly thrilled with my version of their operations in Iraq — and they’ve acted accordingly when it comes to me (something you can read about by clicking here).  For this excerpt, I suggest adding only a little salt.  – Peter Van Buren

Chickening Out in Iraq

How your tax dollars financed “reconstruction” madness in the Middle East.

Very few people outside the agricultural world know that if the rooster in a flock dies the hens will continue to produce fertile eggs for up to four weeks because “sperm nests,” located in the ovary ducts of hens, collect and store sperm as a survival mechanism to ensure fertile eggs even after the male is gone. I had to know this as part of my role in the reconstruction of Iraq.

Like learning that Baghdad produced 8,000 tons of trash every day, who could have imagined when we invaded Iraq that such information would be important to the Global War on Terror? If I were to meet George W., I would tell him this by way of suggesting that he did not know what he was getting the country into.

I would also invite the former president along to visit a chicken-processing plant built with your tax dollars and overseen by my ePRT (embedded Provincial Reconstruction Team). We really bought into the chicken idea and spent like drunken sailors on shore leave to prove it. In this case, the price was $2.58 million for the facility.

The first indication this was all chicken shit was the smell as we arrived at the plant with a group of Embassy friends on a field trip. The odor that greeted us when we walked into what should have been the chicken-killing fields of Iraq was fresh paint. There was no evidence of chicken killing as we walked past a line of refrigerated coolers.

When we opened one fridge door, expecting to see chickens chilling, we found instead old buckets of paint. Our guide quickly noted that the plant had purchased 25 chickens that morning specifically to kill for us and to feature in a video on the glories of the new plant. This was good news, a 100% jump in productivity from previous days, when the plant killed no chickens at all.

Investing in a Tramway of Chicken Death

The first step in Iraqi chicken killing was remarkably old. The plant had a small window, actually the single window in the whole place, that faced toward a parking lot and, way beyond that, Mecca. A sad, skinny man pulled a chicken out of a wire cage, showed it the parking lot, and then cut off its head.

The man continued to grab, point, and cut 25 times. Soon 25 heads accumulated at his feet. The sharply bright red blood began to pool on the floor, floating the heads. It was enough to turn you vegan on the spot, swearing never to eat anything substantive enough to cast a shadow. The slasher did not appear to like or dislike his work. He looked bored. I kept expecting him to pull a carny sideshow grin or wave a chicken head at us, but he killed the chickens and then walked out. This appeared to be the extent of his job.

Once the executioner was done, the few other workers present started up the chicken-processing machinery, a long traveling belt with hooks to transport the chickens to and through the various processing stations, like the ultimate adventure ride. But instead of passing Cinderella’s castle and Tomorrowland, the tramway stopped at the boiler, the defeatherer, and the leg saw.

First, it paused in front of an employee who took a dead chicken and hung it by its feet on a hook, launching it on its journey to the next station, where it was sprayed with pressurized steam. This loosened the feathers before the belt transported the carcasses to spinning brushes, like a car wash, that knocked the feathers off. Fluff and chicken water flew everywhere.

One employee stood nearby picking up the birds knocked by the brushes to the floor. The man was showered with water and had feathers stuck to his beard. The tramway then guided the chickens up and over to the foot-cutting station, which generated a lot of bone dust, making breathing in the area unpleasant.

The feet continued on the tramway sans torso, ultimately to be plucked off and thrown away by another man who got out of bed knowing that was what he would do with his day. The carcass itself fell into a large stainless steel tub, where someone with a long knife gutted it, slid the entrails down a drain hole, and pushed the body over to the final station, where a worker wrapped it in plastic. The process overall sounded like something from Satan’s kitchen, grinding, squeaking, and squealing in a helluva racket.

According to our press release, the key to the project was “market research which indicated Iraqis would be willing to pay a premium for fresh, halal-certified chicken, a market distinct from the cheaper imported frozen chicken found on Iraqi store shelves.” The only problem was that no one actually did any market research.

In 2010, most Iraqis ate frozen chicken imported from Brazil. Those crafty Brazilians at least labeled the chicken as halal, and you could buy a kilo of the stuff for about 2,200 dinars ($1.88). Because Iraq did not grow whatever chickens ate, feed had to be imported, raising the price of local chicken. A live bird in the market went for about 3,000 dinars, while chicken from our plant, where we had to pay for the feed plus the workers and who knew what else, cost over 4,000 dinars, more than the already expensive live variety and almost double the price of cheap frozen imports.

With the fresh-chicken niche market satisfied by the live birds you killed yourself at home and our processed chicken too expensive, our poultry plant stayed idle; it could not afford to process any chicken. There was no unfulfilled market for the fresh halal birds we processed. Nobody seemed to have checked into this before we laid out our $2.58 million.

The US Department of Agriculture representative from Baghdad visiting the plant with us said the solution was to spend more money: $20,000 to pay a contractor to get license plates for the four Hyundai trucks outside in the parking lot facing Mecca. Our initial grant did not include licensing the vehicles we bought. The trucks, he hoped, would someday transport chicken to somewhere there might be an actual market.

Another Embassy colleague repeated the line that the plant was designed to create jobs in an area of chronic unemployment, which was good news for the chicken slasher but otherwise not much help. If employment was indeed the goal, why have an automated plant with the tramway of chicken death? Instead, 50 guys doing all the work by hand seemed like a better idea. A chubby third Embassy person who came to the plant for the day, huffing and puffing in body armor, said the goal was to put more protein into the food chain, which might have been an argument for a tofu factory or a White Castle.

A Poultry Field of Dreams in Iraq

How many PRT staff members does it take to screw in a lightbulb? One to hire a contractor who fails to complete the job and two to write the press release in the dark.

We measured the impact of our projects by their effect on us, not by their effect on the Iraqis. Output was the word missing from the vocabulary of developing Iraq. Everything was measured only by what we put in — dollars spent, hours committed, people engaged, press releases written.

The poultry plant had a “business plan,” but it did not mention where or how the chickens would be marketed, assuming blindly that if the plant produced chickens people would buy them — a poultry Field of Dreams. Without a focus on a measurable goal beyond a ribbon cutting, details such as how to sell cold-storage goods in an area without refrigeration fell through the cracks. We had failed to “form the base of a pyramid that creates the possibility of a top,” the point of successful development work.

The plant’s business plan also talked about “an aggressive advertising campaign” using TV and radio, with the modern mechanized chicken processing, not the products per se, as the focus. This was a terrific idea in a country where most people shopped at open-air roadside markets, bargaining for the day’s foodstuffs.

With a per capita income of only $2,000, Iraq was hardly a place where TV ads would be the way to sell luxury chicken priced at double the competition. In a college business class, this plan would get a C?.  (It was nicely typed.) Once someone told the professor that $2.58 million had already been spent on it, the grade might drop to a D.

I located a report on the poultry industry, dated from June 2008, by the Inma Agribusiness Program, part of the United States Agency for International Development (and so named for the Arabic word for “growth”). The report’s conclusion, available before we built our plant, was that several factors made investment in the Iraqi fresh-poultry industry a high-risk operation, including among other factors “Lack of a functional cold chain in order to sell fresh chicken meat rather than live chickens; prohibitive electricity costs; lack of data on consumer demand and preference for fresh chicken; lack of competitiveness vis-à-vis frozen imports from Brazil and USA.”

Despite the report’s worrying conclusion that “there are no data on the size of the market for fresh chicken,” the Army and the State Department went ahead and built the poultry-processing plant on the advice of Major Janice. The Major acknowledged that we could not compete on price but insisted that “we will win by offering a fresh, locally grown product… which our research shows has a select, ready market.”

A now defunct blog set up to publicize the project dubbed it “Operation Chicken Run” and included one farmer’s sincere statement, “I fought al-Qaeda with bullets before you Americans were here. Now I fight them with chickens.” An online commentator named Jenn of the Jungle added to the blog, proudly declaring: “This right here is what separates America from the swill that is everyone else. We are the only ones who don’t just go, fight a war, then say hasta la vista. We give fuzzy cute little baby chicks. I love my country.”

So, to sum up: USAID/Inma recommended against the plant in 2008, no marketing survey was done, Major Janice claimed marketing identified a niche, a business plan was crafted around the wish (not the data), $2.58 million was spent, no chickens were being processed, and, for the record, al Qaeda was still in business. With this in mind, and the plant devoid of dead chickens, we probably want to wish Major Janice the best with her new ventures.

Telemarketing? Refi sales? Nope. Major Janice left the Army and the U.S. Department of Agriculture in Baghdad hired her. Her new passion was cattle insemination, and we learned from her blog, “You don’t just want semen from bulls whose parents had good dairy production. You may want good feet, good back conformation or a broad chest.” Just what you’d expect from a pile of bull.

War Tourism

Soon after my first chicken plant visit we played host to three Embassy war tourists. Unlike the minority who traveled out on real business, most people at the Embassy rarely, if ever, left the well-protected Green Zone in Baghdad during their one-year assignments to Iraq. They were quite content with that, happy to collect their war zone pay, and hardship pay, and hazardous duty pay while relaxing at the bar.

Some did, however, get curious and wanted to have a peek at this “Iraq” place they’d worked on for months, and so they ginned up an excuse to visit an ePRT. A successful visit meant allowing them to take the pictures that showed they were out in the field but making them miserable enough that they wouldn’t come back and annoy us again without a real reason.

One gang of fun lovers from the Embassy who wrote about water issues in Iraq decided to come out to “Indian Country.” At the ePRT we needed to check on some of the wells we were paying for — i.e., to see if there was a hole in the ground where we’d paid for one.  (We faced a constant struggle to determine if what we paid for even existed.)  So the opportunity seemed heaven sent. The bunch arrived fresh from the Green Zone, two women and a man.

The women still wore earrings — we knew the metal got hot and caught on the headsets — and had their hair pulled back with scrunchies.  (Anyone who had to live in the field cut it short.) The guy was dressed for a safari, with more belts and zippers than Michael Jackson and enough pockets and pouches to carry supplies for a weekend. Everyone’s shoes were clean. Some of the soldiers quietly called our guests “gear queers.”

Everywhere we stopped, we attracted a crowd of unemployed men and kids who thought we’d give them candy, so the war tourists got multiple photos of themselves in their chic getups standing next to Iraqis. They were happy. But because it was 110 degrees and the wells were located in distant dusty fields an hour away, after the first photo op or two the war tourists were quickly exhausted and filthy, meaning they were happy not to do it all again.

We took two more tourists back to the chicken plant: the Embassy’s Deputy Chief of Mission (who proclaimed the visit the best day he’d ever had in Iraq, suggesting he needed to get out more often) and a journalist friend of General Raymond Odierno, who was thus entitled to VIP treatment.

VIPs didn’t drive, they flew, and so tended to see even less than regular war tourists. Their visits were also more highly managed so that they would stay on message in their blogs and tweets. It turns out most journalists are not as inquisitive as TV shows and movies would have you believe. Most are interested only in a story, not the story.

Therefore, it was easy not to tell the journalist about the chicken plant problems. Instead, we had some chickens killed so the place looked busy. We had lunch at the slaughter plant — fresh roasted chicken bought at the market. The Iraqis slow roast their chickens like the Salvadoreans do and it was juicy, with crisp skin. Served lightly salted, it simply fell apart in your mouth. We dined well and, as a bonus, consumed the evidence of our fraud.

– To the original article…


$30B wasted in Iraq, Afghanistan?

Tuesday, September 20th, 2011

– And people wonder why some of us American citizens resent our taxes?

– They collect all these taxes and gift them to the big Wall Street firms that caused the current financial mess and they spend it on wars in Iraq and Afghanistan….   And they waste HUGE amounts of it like we have an endless supply.

– But just let the average citizen get behind on his annual Federal Income Taxes and the entire might of the government comes down on that citizen.

– Well I, for one, have small patience with their desire to collect my taxes when I know that the main thing that is going to be done with them is to make the rich richer and to waste them on foreign adventures.   While in the American homeland the highways and bridges deteriorate, social programs are being cut, unemployment is growing, wages are shrinking and things are generally going to HELL.

– And they really need my taxes.   Yeah, I bet they do.


 – – – – – – – – – – – – – – – –

More than $30 billion — one in every six dollars of U.S. spending in Iraq and Afghanistan — has been wasted, according to a bipartisan commission on wartime contracting.

“Tens of billions of taxpayer dollars have been wasted through poor planning, vague and shifting requirements, inadequate competition, substandard contract management and oversight, lax accountability, weak interagency coordination, and subpar performance or outright misconduct by some contractors and federal employees,” the report’s co-authors wrote in a Washington Post editorial on Sunday.

The full findings of the bipartisan Commission on Wartime Contracting in Iraq and Afghanistan will be submitted to Congress on Wednesday. The report was written by Christopher Shays, a former Republican congressman from Connecticut, and Mark Thibault, a former deputy director of the Defense Contract Audit Agency.

Examples of wasteful projects abound: the authors note that U.S. taxpayers spent $40 million on a prison that the Iraqi government did not want, and in any case was never finished. Another $300 million was spent on a power plant in Afghanistan that requires technical expertise beyond the Afghan government’s capabilities.

The number of contractors in Afghanistan and Iraq has sometimes exceeded the number of U.S. military forces on the ground, with the ratio usually being held at roughly one to one over the years according to the report.

The report will include 15 recommendations on how to reduce waste, including the recommendation that there be an official that can serve in both the Office of Management and Budget and the National Security Council in order to coordinate the many agencies involved in contracts.

– To the original…


Healthcare in New Zealand

Friday, September 9th, 2011

– For my American friends who still haven’t worked out how badly you are being treated by the corporate owned and dominated healthcare industry in the U.S., let me share the details of my small interaction this afternoon with the New Zealand system.

– I made an appointment with my GP two days ago and I went in today to see him and discuss my current health (which has returned to excellent) and to get some prescriptions renewed.

– I noted that he has copies of all my medical records from the several places here in New Zealand where I’ve generated records; 24 hour walk-ins, other GP’s offices and the hospital.   It’s all shared electronically here and the system is organized so that it all your medical records go automatically to your GP (who you can change any time you like at no charge and all your records will follow you).

– My appointment was at the end of the day at 5 PM and, amazingly, he was only 10 minutes late in seeing me.

– I spent 20 minutes with him talking over various issues and discussing prescriptions and whether, based on research, I should be taking this or that.   In the end, he wrote me five prescriptions. 

– At the front desk, my bill for seeing him was $38.00.   I then walked next door (literally) to the pharmacy and my prescriptions were filled in under 10 minutes and I was charged $3.00 each or a total of $15.00.   I know from earlier experiences that those which have refills authorized will be refilled for no charge.   The original $3.00 covers it.

– Here, the medical system is what some would call Socialized Medicine.   That simply means that we, the people, all pay for it with our taxes.   The government has a special branch that shops for the prescription medicines consumed in the country.   It’s a simple circle:  we all pay taxes, according to how much we earn, to subsidize the medical system.  And we all use and benefit from it according to our level of need.

– In the U.S., there’s something or someone else in what should be a simple circle.   It’s the corporate for-profit entities.   And they are milking the American consumer big time to maximize their profits and holding the health of Americans for ransom in order to do it.   Meanwhile, the U.S. government, which collects nearly as much tax as is collected here, doesn’t have to use that money to maintain the health of the American people because the corporate entities have said, “No problem, we’ve got it covered“.  Yeah, right!   So, the government is free to spend the taxes Americans pay instead on foreign wars, bank bailouts and whatever else they think governments are suppose to be about.

– In my opinion, the purpose of government’s should be about maximizing the quality of life for all of its citizens – not just for its ‘corporate citizens’.

– Wake up my friends – things are a mess there!

– dennis

The Lesson of the Chinese Invasion

Friday, September 2nd, 2011

– Isn’t this how America took over much of Central and South America 50 to 100 years ago?   Selling them things they didn’t have, gaining control of their markets and buying up control of their natural resources?

– And then, eventually, as the Americans moved behind the scenes, right wing dictatorships friendly to American interests were installed so that the money from the local resources could keep flowing to the US and so that any local political unrest was kept in check?

– Many left-wing students of American foreign policy over the last 2 or 3 decades will recognize these patterns.   Allende, Copper & Chile and Nicaragua’s Sandinistas and Contras are just two arch-typical stories of this genre. 

– So, the wheel of history turns and the Chinese nw are only doing what rising economic powers do; which is to seek more of the same.    And the greed of the naive and unsuspecting for lower prices in their target markets makes it all quite easy for them.   And all the money returns home to China and the standard of living of the Chinese people rise each year and their military is rapidly advancing from third-world quality to first-wolrd.

– What part of this “writing on the wall” can students of history not see?

– But amazingly, the short terms benefits always drive us like lemmings bound for their cliff jumps, to stock our stores with cheap Chinese gee-gaws.  And while the cheaply manufactured stuff pours into our countries, our cash goes the other way and day by day we deliver increasing power over us to them.

– Even here in my new country, New Zealand, the big box stores are jammed with cheap gee-gaws.   And the currently ascendant National Party (a rough analog of the US’s Republican Party) is busy passing laws to allow the country to sell off chucks of it essential infrastructure; Electric power generation, rail systems, etc.   The say that they believe not more than 10 to 20% will be sold so we will still retain control.  But, significantly, they’ve put no legal limits on how much can be sold – so they don’t offend or scare off the buyers.  (right!).

– They are saying that we need to do this to raise capital to fund other infrastructure projects that the nation needs.   As a first-order argument, that sounds, perhaps, reasonable.   But turn the crank one more round, and those new infrastructures will also need to be sold to fund the next round.  And so on.

– How sweet for the offshore buyers; an entire country building itself up very nicely and selling itself off as it does so.   Eventually, we’ll have a very nice country with lots of excellent infrastructure here.   And all owned by someone else.

– Going down this path, either here or in the US, how long will it be before the Chinese’s unlimited money is controlling who is winning elections?   And how long before they’ve installed a majority of people in the government who are deeply sympathetic to Chinese interests?   After that, it’s a single inevitable step to a nation becoming a Banana Republic to the Chinese juggernaut – much like many nations in Central and South America were when the American hegemony was at its apex.

– To my Chinese friends and readers  this is not an anti-Chinese flame I’ve written.   I fully believe that if it was Brazil, or India or any of a dozen other countries, the results would be the same.    This is all driven by human greed for power and control.  And the fact that it is the Chinese who are just now sitting in the global power spot, is just a coincidence of history and not an indictment of them as a people.

– dennis

= = = = = = = = = = = = = = = = =

Many economic Nostradamuses have long predicted that the epitaph on America’s tombstone will ultimately read, “Made In China.” But casual observers probably didn’t think the funeral procession would happen this fast. In the last year, though, most have wised up. Thanks to a spate of mind-blowing headlines, we are learning that the Chinese invasion isn’t just a distant possibility — it’s happening right now.

First, in February, ABC News reported that almost every Americana-themed trinket sold in the Smithsonian Institute is made in China. Then news hit that San Francisco is importing its new bay bridge from China. Then came the New York Times dispatch about the Big Apple awarding Chinese state-subsidized firms huge taxpayer-funded contracts to “renovate the subway system, refurbish the Alexander Hamilton Bridge over the Harlem River and build a new Metro-North train platform near Yankee Stadium.”

Astounding as all of that is, it was quickly topped by news last week reminding us that the new Martin Luther King monument in Washington was designed by a Chinese government sculptor and assembled by low-wage Chinese workers.

The trend is enough to trouble any American. After all, when a memorial for a civil rights leader who deplored “starvation wages” and died supporting a sanitation union’s strike is built by non-union serfs from China, it’s a good sign there’s a big problem.

But then, what exactly is that problem?

Xenophobes will say China’s ascendance threatens America’s global cultural hegemony and promises to create a dystopia forcing us all to endure the supposed horrors of speaking Mandarin and using chopsticks.

Such misguided and bigoted demagoguery, though, distracts from the real crisis staring at us in our own mirror — a crisis not of other, but of self. Indeed, for all the fears of external assault, the Chinese invasion tells us the true problem is that America is no longer willing or able to invest in its own future.

– To read more…


India corruption: Hazare heaps pressure on government

Tuesday, August 23rd, 2011

– This post is for, and in honor of, my friend Mangala Gouri in India.   She’s engaged on a hunger strike in solidarity with so many others there who want to see corruption eliminated.

– I applaud her and all of those like her who want to see changes in India.

– It’s been my opinion that graft and corruption suck the energy out of an economy.  

– Imagine, if everyone who wanted a bit of your gasoline could attach a small hose to the pipe in your car that carries gasoline to the engine.  After awhile, the engine would get weak and the car might stop.  Graft and corruption are like that.   But the car they are stopping is the economy that belongs to all the people.   The economy that builds the wealth of the nation.   Wealth that is used for roads and schools – among other things.

– Graft and corruption are just a way of stealing from all of us for the benefit of the few.

– Bravo, Gouri !   Bravo.

= = = = = = = = = = = = = = = = = = =

Indian anti-corruption activist Anna Hazare has called on the government to pass a new anti-graft law or quit.

He has been on a public hunger strike since last Tuesday. An aide said he had lost 5kg, but was in good health.

Thousands of supporters are gathered at the vast Ram Lila Maidan grounds in the capital, Delhi, where Mr Hazare is conducting his fast.

Meanwhile, Prime Minister Manmohan Singh has said the government is open to talks with the 74-year-old activist.

Mr Hazare wants to force the government to strengthen an anti-corruption bill, which he regards as too weak.

He was released from Tihar jail on Friday after his arrest last Tuesday sparked mass protests across India.

On Thursday, he agreed to a police offer permitting him to go on hunger strike for 15 days.

He had previously vowed to remain in custody unless he was permitted to resume the protest which triggered his arrest. His campaign against graft has struck a chord with many Indians.

– More…  

Day of truth for the markets

Sunday, August 7th, 2011

– I suppose it is simply ego, but it gives me a perverse pleasure to read things I’ve been thinking and saying for years when I read them in publications like the one below.

“…it is becoming clear that to create jobs and rising wages and living standards, the United States will have to resume producing tradable goods and providing tradable services that will reduce its chronic trade deficits.”

– Exactly.

– Dennis

– – – – – – – – – – – – – – – – –

Today is the day the truth of the global economy has finally come out, and the markets are facing up to it with terror and trembling.

At first, a better than expected U.S. jobs report appeared to be reversing some of the week’s negative market sentiment as the Dow headed north, but that quickly proved to be just a head fake. In the first place, the numbers were only good by comparison with the really horrible ones of last week, and in the second place, the jobs numbers don’t tell you as much about the U.S. economy as the numbers for the long-term unemployed and for the proportion of the working age work force that is actually working. Those numbers are among the worst for the United States since the 1930s.

Perhaps even more important than that has been the dawning recognition that the agonizing last-minute agreement to raise the U.S. debt limit has not resolved and may actually have added to U.S. economic woes. The rush of investors into yen, Swiss francs, Canadian dollars, Israelis shekels (anything but U.S. dollars) over the past two days has been a dramatic signal that investors see the U.S. outlook as bleak and that no one believes U.S. leaders have a clue about how to run the economy or where they want America to go more generally. The debt limit debate demonstrated the rot of government dysfunction to be far more advanced that any had imagined.

Equally dysfunctional have been the leaders of the European Union whose serial announcements of one inadequate bailout agreement after another have only served to exacerbate rather than resolve doubts about the future of the euro and, indeed, of the EU itself.

A third element has been the recognition that Japan is unlikely to become a driver of growth and that a world burdened by slow growth in Japan, the EU, and the United States is unlikely to be a very dynamic place, no matter how rapid the growth in China and India. There may have been some degree of decoupling over the past decade, but not that much.

All of this is forcing a facing of realities. For nearly thirty years, the conventional story has been that the U.S. economy is flexible, dynamic, moving from strength to strength in high-tech and sophisticated global services. But now the truth is dawning that two decades of first the bubble and then the real estate and financial bubbles were simply a Potemkin village masking the chronic erosion of U.S. industrial and technological leadership and of the standard of living of the middle class. It is now becoming clear that the United States is not going to recover anytime soon and that it is in for a long battle to revitalize its restore its former economic dynamism.

In particular, it is becoming clear that to create jobs and rising wages and living standards, the United States will have to resume producing tradable goods and providing tradable services that will reduce its chronic trade deficits. This, of course, will mean a weaker dollar and a decline of U.S. consumption as a percent of the world’s total consumption. And, this, in turn will mean a wrenching readjustment of the global supply chain and of the long accepted patterns of globalization.

By the same token, Europe has reached a crossroads. If the euro and perhaps the EU as well are to survive, there must be a truly European finance system as well as a central bank. It will no longer work to have the Germans running trade surpluses while everyone else runs trade deficits in the absence of an effective system of funds transfers from surplus to deficit areas. Europe must become truly Europe, or no Europe at all.

It seems that after decades of undervaluing its currency to foster its export-led growth strategy, Japan will now finally be forced to reorient its economy toward domestic consumption by the tightening noose of the ever strengthening yen. Truly, it has been said that “those who live by the sword will die by the sword.”

This is a lesson that China might do well to learn now rather than much later as in the case of Japan.

– To the original…