Archive for the ‘bad ideas’ category

Reason Number Gazillion I Thank The FSM For The 2008 Election Result

July 21, 2014

That would be that Lindsay Graham, the Republican senator who is totally not pandering for re-election.  The idea that this guy would have had any possibility of a role at the center of the national security and or foreign policy apparatus in a McCain administration should send jolts of terror through anyone who doesn’t think the war in Iraq has done so much good for the U.S. and the world.

Here he is talking to David Gregory, as covered by TPM.  His topic? The failings of those who actually do the hard work of trying to make sure that the US foreign policy has something more in its arsenal than the blow-shit-up option:

Easy enough to say I suppose.  Lots of places are in a bad way, and the news last week was flat out horrible.  But, as always, there’s the tricky bit to come. That ferocious interrogator David Gregory asked Graham what Kerry should have said about events in the Ukraine.  For some reason, this not exactly surprising query proved a bit more than Graham could coherently handle:

“One, he didn’t call Putin the thug that he is.

“And you’re ugly too!  So there!”

Laughing_Fool

I mean, seriously?  The way to advance the goal of constraining Putin is to say nasty things about him?  When, in fact, a US led effort to rally European nations to put real pressure on Putin is beginning to show force?

This is why someone whose strategic education seems to have come from games with toy soldiers should shut up and let the grown ups work.

But no:

He didn’t call for arming the Ukraine so they can defend themselves against rebel separatists supported by Russia,” Graham responded.

Because ramping up the deadliness of the conflict is exactly what you want to do at a moment when Putin’s own escalation has just dealt the Russian approach a terrible blow.  Graham’s demand makes sense if the only if you imagine that if you’re not shooting someone, you’re losing.

Again — thank the FSM that this clown has only a soap box to deploy.

Finally, the cherry on top:  Graham’s deepest complaint is that the present administration…well, let him say it:

“President Obama is trying to be deliberative. It comes off as indecisive. He’s trying to be thoughtful. It comes off as weakness,” he continued.

There you have it, folks. Why the current GOP can’t be allowed anywhere near the launch codes for the foreseeable future.  Heaven forfend that someone with life-and-death power should stop and think a bit about when and how to exercise lethal force.  Just go ahead and shoot, man!  Something — anyone! That way you won’t look weak…

…Instead, you will just become weak.  See, e.g., the way in which the shot-from-the-hip war-of-choice in Iraq has so strengthened the US position around the world.

Lindsay Graham is going to get his next six years in the Senate.  The country will be the poorer for it.  But it could have been worse — and yet may be, if we don’t ensure that the 2016 election consigns his worthless carcass to the green rooms and of the United States of Sunday Morning for another term.

Image: Netherlandish (possibly Jacob Cornelisz. van Oostsanen), Laughing Fool, c. 1500

Too Dumb To Live: Meet The Pre-Darwin Award Contenders

July 7, 2014

I actually caught this phenomenon a couple of days ago (and was twitted on Twitter for being so late to the party), but the phenomenon of “Coal Rolling” is now an object of wonder and bemusement at a number of the usual suspects.

For those of you who have managed to enjoy life, liberty and the pursuit of happiness to this point without suffering the knowledge of this particular stupidity, here’s David Weigel to explain it to you:

Forty-five second YouTube clips don’t come any more American than “Prius Repellent.” It starts with a camera angled from the passenger side window of a truck, pointed at the namesake Japanese hybrid car. After 12 establishing seconds, the cameraman moves and points out the back window, where viewers can read the ominous decals:

←PRIUS REPELLENT→

At 23 seconds, the engine revs and the viewer finally learns what the arrows were pointing at. Smoke pours out of dual stacks, right in the path of the Prius, which retreats into the rear view. The truck’s passengers share a well-earned chortle.

That’s right.  These Real Americans™ pay good money to modify their vehicles so that they can run less efficiently and pollute more, because, you know, that’s how Hydrocarbon Jesus wants it.

I know, I know.  The good Lord must have loved assholes because he made so many of them.  But these folks are double-secret-probation cute that way:

There are videos of “hot babes” getting rolled on, and a mega-popular video (more than 3 million views) of an annoying Prius driver complaining about diesel. “She makes me want to do a John Force style burn out right in front of her,” observed one critic on DieselBurners.com.

The derp is deep here.  Let’s say you want to roll some of your own coal.  There are sites to help you do that.  Here’s one — complete with a bit of pure weasel DNA up front:

 

Disclaimer: This article has been published for entertainment/educational purposes only. We do not recommend you modify your truck in any manner for the sole purpose of soot/smoke production. Not only may excessively high EGTs cause engine damage, but these acts are having detrimental repercussions on our industry. Consider reading the article “Smoke Responsibly” for further information, including how you can help. There is a time and a place to roll some coal – don’t give the tree huggers any ammunition to support further emissions restrictions.

I’m trying to imagine the time and place…and too late re the tree huggers.  TPM reports today that this is (obviously) illegal as hell anyway.  But never mind, it turns out that there’s a way to roll coal the “right way”:

The best way to blow some serious black smoke is to go all out. Larger injectors combined with aggressive custom tuning will let you lay down some massive clouds of black smoke – the ultimate coal roll. Injectors increase the amount of fuel that can be dumped into your engine per injection cycle, while the tuning keeps the engine thinking it needs more diesel. Throw in a larger injection pump to keep fuel pressures high and add a water-methanol injection system to keep EGTs down and you have the perfect combination. With the flip of a switch, leave your challengers in a stream of thick black soot and then clean up the exhaust stream to keep the authorities happy.

I don’t know what’s most pathetic.  The idea of some strangers just trying to get from here to there as “competitors” — think of the terror hidden in that statement, the sheer gut-churning fear of the unknown — or the urge to spend the most possible money to spend more money doing nothing but half-burn all that $4-and-up diesel.

A lot of us liberals pointing and laughing at these assholes have noted that the whole idea is a way for the carbon-industrial-complex to screw more cash out of the credulous, but a lot of folks seem to have missed the other point.

Black_Country_–_Borinage

Partially combusted diesel is…no way to put this gently…not good for you.  Not at all:

Exposures have been linked with acute short-term symptoms such as headache, dizziness, light-headedness, nausea, coughing, difficult or labored breathing, tightness of chest, and irritation of the eyes and nose and throat[citation needed]. Long-term exposures could lead to chronic, more serious health problems such as cardiovascular disease, cardiopulmonary disease, and lung cancer.[11][7][8] The NERC-HPA funded ‘Traffic Pollution and Health in London‘ project at King’s College London is currently seeking to refine our understanding of the health effects of traffic pollution. Ambient traffic-related air pollution was associated with decreased cognitive function in older men.[10]

Mortality from diesel soot exposure in 2001 was at least 14,400 out of the German population of 82 million, according to the official report 2352 of the Umweltbundesamt Berlin (Federal Environmental Agency of Germany).

Since the study of the detrimental health effects of nanoparticles (nanotoxicology) is still in its infancy, and the nature and extent of negative health impacts from diesel exhaust continues to be discovered.

Obviously, the goal of the hardcore coal roller is to give angst and maybe a whiff of the nasties to the fearsome folks who presume to traverse America’s roads in a Prius.  But as videos like this one show — the most likely consumers of soot and other particulates produced by the deep need to f**k up one’s own nest are the folks who want to show the world how much smoke they can blow.

The wheels of Darwin grind slow…but very sure.

By the way — all of this can be considered a distant early preview of my conversation on Wednesday.  In this month’s edition of my rotating gig as host of  Virtually Speaking Science, I’ll be speaking (again!) with Naomi Oreskes, now a professor of the history of science at Harvard.  Naomi was my first guest on the show, back in 2011.

That’s when we talked about the lessons of her book (written with Erik M. Conway) Merchants of Doubt, on the ways a handful of Cold War anti-Communist scientists figured out how to sell lies wholesale, leading to the implausible success of a tiny handful of people in casting enormous doubt on the reality of climate change.

Now she and Larsen have followed that work up with a novella, The Collapse of Western CivilizationThis little work — it’s just fifty pages, not counting notes and such — imagines a future historian analyzing how 21st societies allowed them to fall victim to climate catastrophes that they/we knew/know are in prospect.

It’s a depressing work, and speculative, and the more important for all of that.  If we do go down the road of catastrophe as Oreskes and Conway lay it out, folks like our coal rollers will be a (small but exemplary) part of the reason why.

Tune in.  It should be a useful downer — and funny too.  Naomi is a hoot, the more so given the pathologies she studies

Image:  Constantin Meunier, Black Country–Borinage, before 1905.

I’m All For The Rule Of Law. It’s The Judges I Can’t Stand

July 7, 2013

Via today’s The New York Times,* some big-time journalism on how the FISA court is creating an alternate judiciary — at least potentially more powerful, than the already compromised public one by which we thought American citizens encountered the law:

In more than a dozen classified rulings, the nation’s surveillance court has created a secret body of law giving the National Security Agency the power to amass vast collections of data on Americans while pursuing not only terrorism suspects, but also people possibly involved in nuclear proliferation, espionage and cyberattacks, officials say

….

“We’ve seen a growing body of law from the court,” a former intelligence official said. “What you have is a common law that develops where the court is issuing orders involving particular types of surveillance, particular types of targets.”

In one of the court’s most important decisions, the judges have expanded the use in terrorism cases of a legal principle known as the “special needs” doctrine and carved out an exception to the Fourth Amendment’s requirement of a warrant for searches and seizures, the officials said.

Pedro_Berruguete_-_Saint_Dominic_Presiding_over_an_Auto-da-fe_(1475)

The special needs doctrine was originally established in 1989 by the Supreme Court in a ruling allowing the drug testing of railway workers, finding that a minimal intrusion on privacy was justified by the government’s need to combat an overriding public danger. Applying that concept more broadly, the FISA judges have ruled that the N.S.A.’s collection and examination of Americans’ communications data to track possible terrorists does not run afoul of the Fourth Amendment, the officials said.

That legal interpretation is significant, several outside legal experts said, because it uses a relatively narrow area of the law — used to justify airport screenings, for instance, or drunken-driving checkpoints — and applies it much more broadly, in secret, to the wholesale collection of communications in pursuit of terrorism suspects. “It seems like a legal stretch,” William C. Banks, a national security law expert at Syracuse University, said in response to a description of the decision. “It’s another way of tilting the scales toward the government in its access to all this data.”

I’m once again crashing deadlines, so I’ll leave off trying to write (n) words on a subject in which I have no particular expertise (the sound you hear is the peanut gallery cheering).  The only thing I can say both quickly and with a reasonable shot at validity is that we already know how this kind of thing, unchecked, plays out.  Secret courts trump even secret police as a threat  to both democracy and freedom of thought and expression.

We’ve seen how this works in plenty of prior examples — and not just in the bad decades of the 20th century either.  This isn’t where we should be now.

Over to you…

*This kind of piece is the reason I maintain my (Sunday) subscription to the Grey Lady.  The opinion pages may be a howling desert of intellectual mediocrity (w. the Krugman exception and a few others worthy of honorable mention) and outright mendacity (looking at you BoBo)¹.  But there is no substitute for the quality of journalism backed by real resources that the Times is capable of when it chooses.  I know it doesn’t always do so (Judith Miller, anyone).  But it still is the home of more of this kind of stuff than any other MSM outlet (that I can think of).  So, yeah, we still need the place, much as we need it do a whole lot better a lot of the time.

¹I’m not even going to go into the “It’s not nice, child, to point and laugh” division populated entirely by Master Ross Douthat.

Image:  Pedro Berruguete, Saint Dominic Presiding over an Auto-da-fe, 1475.

Proceed, Whack Jobs

January 14, 2013

Via TPM, I was sent to this website, [fair warning:  crazy people on the other end of that link] to find this image:

aerialConcept_lg

There has been plenty of ridicule directed at the project depicted here — see, for example, posts by others at my alternate blog-home, Balloon Juice.  If you haven’t been keepign up, it’s called the Citadel — that Wingnut fantasy of a Dungeons-and-Dragons-and-Bushmasters retreat in Idaho where no liberals need apply.

All fine — if it were up to me, I’d encourage every gun nut to retreat to their bastions — whether up in the Idaho panhandle, where generations of actually competent folks have found it so easy to construct self-sustaining livelihoods …or in GlennBeckistan, that to-be self-sustaining (sic!) entertainment and intellectual hub to be constructed somewhere in Texas.

Go! Here’s your hat; what’s your hurry?

Seriously:  if they would only do the rest of us the favor of retreating to their own private Somali-o’s, our politics and our societies would be that much saner and safer.

But we knew that already, and that’s not what caught my eye.

Nah.

Here’s the story:  As I’d just opened the picture above, my son happened to come into my study.  He asked what I was looking at — it seemed to him a sketch from one of the medieval combat games he likes and knows I don’t, and he wondered what would possess me to bother with such a thing.

I told him that, no, this wasn’t history or fantasy,* but rather somebody’s actual idea of someplace that would serve to protect them from an overweening federal government.  He just looked at it pityingly, wondering, and he asked me, “have these folks never heard of cannon?”

And damn if that hadn’t been literally my first thought on reading the caption “Interior Defensive Walls & Towers.”  I mean, artillery much?

The stupid.  It burns. With the white-hot-heat-of-a-thousand-suns.

*Well, it is.  But not that kind.

Roland, The Campus Thomson Gunner

August 30, 2012

Add any Colorado public university as a place I do not wish to teach:

Jerry Peterson, a professor of physics at the University of Colorado at Boulder and chair of the Boulder Faculty Assembly, said he would cancel classes if he found that someone had brought a firearm to class, according to the Daily Camera.

Although Peterson said he was only speaking for himself, Philip P. DiStefano, the chancellor at UC-Boulder, sent out an e-mail Tuesday to faculty members that they could not shut down a class if a student with a concealed carry permit brought a gun.Uh.

I really don’t know what to say.
I’m just not sure how it improves the educational environment if during a discussion session, a student might hesitate to criticize an idea from someone packing a Glock.
How about having to decide which kevlar print went best with my slacks on days I was handing back papers?  A “C” can powerfully irritate some folks, I know…
Of course, any constraint on the pedagogical process is secondary to the exercise of Founder-given rights, right?  So said the Colorado Supreme Court last March, thus ensuring that all Colorado public higher ed students can go to class every day secure in the knowledge that if a psycho shooter does show up, they can expect defense in the form of fellow students with much less firearm and incident training than, say, the New York Police Department offers its officers.
I mean, seriously.  What the F**k, America.  You don’t think that there is any zone in which the imminent threat of deadly force might be, you know, inappropriate.
Not to mention the inherent badness of the idea of putting young folks, stress and all the powerful emotion and mood swings that college can evoke in close proximity with firearms.
Holy FSM, am I glad I live in the great pagan-pinko-commie-health-care-providing-gay-marriage-pioneering non-gun-fetishizing Commonwealth of Massachusetts.  The winters may suck here, but sweet baby Jeezus and his dumber younger brother,* at least I don’t have to check my students for holster bulges.
I’d make a crack about Darwin awards and all that, but this really is too damn depressing to think about.
PS — Other states are crazy this way too.  It’s not going to be that long before I’m actually going to check on each institution’s policy before deciding whether it’s prudent to accept speaking invitations. Consider this bit of woe:

More than 200 campuses in six states currently allow concealed carry in some form, Burnett said, be it campuswide or only in certain areas.

*The one who turned wine into water.
Image: Alexandre-Gabriel Decamps, The Suicide, c. 1836

The Clear and Present Danger Chronicles: Goldbugs, GOPsters, The Ryan, and Oh Dear FSM Are They Really That Dumb?

August 25, 2012

I really have to get on with my day job, so I’m going to try to avoid the blogging itch as much as possible over the next while.  But I just can’t stop myself over the latest GOP flirtation with goldbuggery.

As you probably have heard, the Serious, Bold, Sober Party of Fiscal Discipline™ has at least in draft platform language asserted that it is the policy of the Republican party to explore the idea of restoring the US currency to the gold standard.

Y’all can stop laughing — or crying– now.

Paul Ryan, that intellectual powerhouse, the brilliant force that so-kicks-liberal-ass-in-the-gym-and-in-the-head-so-there is on board.  He might try to defend himself by saying that he supports basing US currency not on gold per se, but on a basket of commodities.

But as Yglesias points out, that’s a distinction without a difference. And it’s not even really true.  Dave Weigel notes that Ryan himself locates the root of his thoughts on currency to yet one more bit of Ayn Rand undigestible prose, the Francisco d’Anconia speech in which Rand’s “character”* declares

“It is not the moochers or the looters who give value to money. Not an ocean of tears nor all the guns in the world can transform those pieces of paper in your wallet into the bread you will need to survive tomorrow. Those pieces of paper, which should have been gold, are a token of honor – your claim upon the energy of the men who produce.”

Yup.  Not just a gold standard, but, as Krugman marvels, a gold coinage.

Just to pause on the deep, limpid, unruffled well of stupid required to advocate a gold coinage in place of folding money as an instrument of daily exchange, consider this.  At this week’s prices the lightest US coin, the dime, would, if made of gold, be worth around $120.  A gold quarter would run over $300.  I know that no one — not even the most whacked out GOPsters I’ve been able to find — actually expects us to walk around with socks full of gold dust to trade, but given Ryan’s declared love of this particular passage of Randsanity, I think it worth noting that the reason folks outside the asylum don’t ever take Rand seriously is that the stuff is absurd on every level.  It’s turtles all the way down.**

As you can tell from the linkage above, the whole notion has come in for the a surfeit of ridicule, astonishment, and a general reminder from lots of folks about just how radical, reckless and plain dumb is the GOP, Ryan and Romney approach to the real world.  Ezra Klein’s take is a fine place to start.

So no need to repeat what others have said on this:  if you can’t figure out why the gold standard is such a crap idea, then I’m not going to make any more impact on you than any of the rest of experience.

Instead, I want to pose a choice.  If one were to think about national problems, who should one trust:  Paul Ryan or Benjamin Franklin?

Here’s Franklin, writing on the need for the Commonwealth of Pennsylvania to issue paper money to make up for a shortage of metal coinage.  First up is a passage from near the beginning of his landmark pamphlet from 1729, The Nature and Necessity of a Paper-Currency:

All those who are Possessors of large Sums of Money, and are disposed to purchase Land, which is attended with a great and sure Advantage in a growing Country as this is; I say, the Interest of all such Men will encline them to oppose a large Addition to our Money. Because their Wealth is now continually increasing by the large Interest they receive, which will enable them (if they can keep Land from rising) to purchase More some time hence than they can at present; and in the mean time all Trade being discouraged, not only those who borrow of them, but the Common People in general will be impoverished, and consequently obliged to sell More Land for less Money than they will do at present. And yet, after such Men are possessed of as much Land as they can purchase, it will then be their Interest to have Money made Plentiful, because that will immediately make Land rise in Value in their Hands. Now it ought not to be wonder’d at, if People from the Knowledge of a Man’s Interest do sometimes make a true Guess at his Designs; for, Interest, they say, will not Lie.

No flies on Ben.  Not to mention, the more things change…R-Money represents those with money, and everything he and his party advance should be viewed with that in mind.

And here’s Franklin’s conclusion:

Upon the Whole it may be observed, That it is the highest Interest of a Trading Country in general to make Money plentiful; and that it can be a Disadvantage to none that have honest Designs. It cannot hurt even the Usurers, tho’ it should sink what they receive as Interest; because they will be proportionably more secure in what they lend; or they will have an Opportunity of employing their Money to greater Advantage, to themselves as well as to the Country. Neither can it hurt those Merchants who have great Sums out-standing in Debts in the Country, and seem on that Account to have the most plausible Reason to fear it; towit, because a large Addition being made to our Currency, will increase the Demand of our Exporting Produce, and by that Means raise the Price of it, so that they will not be able to purchase so much Bread or Flower with £100 when they shall receive it after such an Addition, as they now can, and may if there is no Addition: I say it cannot hurt even such, because they will get in their Debts just in exact Proportion so much the easier and sooner as the Money becomes plentier; and therefore, considering the Interest and Trouble saved, they will not be Losers; because it only sinks in Value as a Currency, proportionally as it becomes more plenty. It cannot hurt the Interest of Great Britain, as has been shewn; and it will greatly advance the Interest of the Proprietor. It will be an Advantage to every industrious Tradesman, &c. because his Business will be carried on more freely, and Trade be universally enlivened by it. And as more Business in all Manufactures will be done, by so much as the Labour and Time spent in Exchange is saved, the Country in general will grow so much the richer.

Philadelphia, April 3. 1729.
Among his scary list of superlatives, I’d rank Franklin as the first and probably the most significant thinker on currency and finance British America produced (placing Hamilton in the federal era…).  He was also, unlike both Romney and Ryan, a working independent businessman, someone who grew rich off actually making things.  In his case that would have been the products of his printing shop, in which, inter alia, he turned out much of the paper currency issued by the mid-Atlantic colonies over a couple of decades.  He experienced what tight money means on Main Street, and he understood very clearly who gained and who lost under different currency regimes.  When money grows scarce, as he says clearly above, the few with hard cash get rich at the expense not just of the many, but of society as a whole.
As it was, so it will be.
Bonus smart guy on monetary policy!  Here’s Isaac Newton on the use of paper and the merely notional solidity of metal money:
“If interest be not yet low enough for the advantage of trade and designs of setting the poor on work…the only proper way to lower it is more paper credit till by trading and business we can get more money.”  Radically, he added that “Tis mere opinion that sets a value upon [metal] money,” adding “we value it because we can purchase all sorts of commodities and the same opinion sets a like value upon paper security.”¹
(Isaac Newton was not anti-commodity based money. He was in charge of the Mint as Britain moved from one metallic standard to another, swapping silver for gold.  He remains a man of his time, not Franklin’s or the present day.  Even so, he had a better grasp of the basics of monetary policy than almost all of his contemporaries — and too many of ours.)
So that’s it.  Your choice.  Bet on R-Money and Republican deep thinkers — or stand with Ben and my man Izzy — and, as Krugman reminds us, a couple of centuries at least of practical experience as well.
*I use scare quotes because it makes Cervantes and Defoe weep to think that centuries of the development of the idea of representing human experience in the novel have come to this hideous end.
**Yup.  I do know that what I’m talking about is not the infinite regress problem properly.  But I’m thinking this way:  part of the issue with GOP craziness as it mainstreams is the layered nature of the crazy.  You pull apart one absurdity only to discover the next, perhaps more fundamental one down.  So it is here.
¹Newton quote as reported in G. Findlay Shirras; J. H. Craig, “Sir Isaac Newton and the Currency,” The Economic Journal, Vol. 55, No. 218/219, pp. 230-231.  Self promotion alert: the passage above and Newton’s views on paper and credit are discussed in my book Newton and the Counterfeiter.  It’s stuff like this that is the leaping-off point for my next book project.
Images: Peter Paul Rubens, Ceres and Pan, 1615.
Quentin Massys, Unequal Marriagebetween 1525 and 1530.

 

Why Mitt Will Lose…Or Your Modern GOP In One Line Of Arithmetic

August 4, 2012

Ezra Klein sums up the entire GOP policy approach in one ‘graf:

The reason Romney’s plan doesn’t work is very simple. The size of the tax cut he’s proposing for the rich is larger than all of the tax expenditures that go to the rich put together. As such, it is mathematically impossible for him to keep his promise to make sure the top one percent keeps paying the same or more. [bold in the original]

You can’t get simpler than that.  Mitt Romney wants to cut his taxes so much that he has only two choices left for the rest of his budget:  raise taxes on everyone else and/or allow the deficit to balloon.

I know.  Facts have a liberal bias, and numbers are f**king commies.  This is the GOP reality folks; now we get to decide if we choose to live within it.

Not much else needs saying, really, and I see that the Obama campaign is already on this one like barnacles on Romney’s yacht.  Do read the rest of Klein’s post, by the way.  It lays out the full failure of the whole Romney tax fiasco with admirable clarity. (h/t GOS)

Image:  Paul Klee, Red Balloon, 1922

McArdle Mini-Me Follies, Real Estate Economics Division

May 25, 2012

Blogger’s note: You’ll find below that I use an anonymous source to support my attempt to dissect Someone [who] is wrong on the Internet.™  As always, anonymous sources are only as trustworthy as the writer who deploys them.  You have been warned.  (BTW — I do know that it’s cheating to do even minimal reporting on a blog post.  Sue me.)

Dr. Manhattan is one of the McArdle guests feeding the wire whilst that blog’s proprietor is preparing what will no doubt be a never-before equalled work of economic and/or culinary erudition. His is the nom de blog of someone described as “a lawyer…who represents, among others, clients in the investment industry” — a connection that may prove significant below.

Up for dissection today: his post titled “A Modest Proposal” in which he promotes the idea of killing what he alleges to be the lead culprit in the crash of 2007-8:  Mortgage Backed Securities.

What’s fishy here?  Well — lots.

I’m not going to go full metal blogpocalypse on this, in part because life is too short, and in part because Dr. Manhattan gets props in my book for having written clearly and unequivocally against the vaccine-autism claimed link on his (now dead) personal blog — from the perspective of a parent of an autistic child.  That kind of writing in that community takes courage, so this brush with the McArdle empire will be as free of my usual attitude in that direction as I can make it

That said, here’s the passage that set me wondering about this post:

…killing MBS will likely kill the 30-year fixed-rate mortgage with no prepayment penalty, which, in the words of Raj Date, “does not flourish in the state of nature.”  And right now very few people can get one of those anyway, which is not a coincidence.

Hmmmm.

One of the benefits of hanging out at a place like MIT is that there is almost always someone around who actually knows stuff on just about any subject you’d care to check…and so it is with the economics of real estate.  I dropped a line to a colleague up the street, and got confirmation of the obvious:  the 30 without a pre-payment penalty (the clause that makes refinancing mortgages so straightforward) significantly predates the rise of mortgage backed securities (by decades).  Such mortgages start to appear in the 30s; MBS start to become significant in the marketplace after 1970.  That the end of the latter would kill the former is, as we say, an assumption not in evidence.

Oh well.  And that “very few people can get one…” claim.  I’m filing this in the life-is-too-short category to check fully, so I’ll just note that (a) 30 year mortgages remain by far the most common housing loan out there — roughly three quarters of all mortgages as of the most recent Census report (2011, on 2009 data).

Also, being as I’m someone refinancing for the third time a loan first taken out in 2009, I can in my anecdotage* attest that the no-prepayment-penalty mortgage is both alive and trivially easy to obtain.  (At least in my market, it remains the default option.)

What bothers me about this passage is just the garden variety flaw behind so much glibertarian and/or right econ blogging:  what they know** requires no actual data to confirm.  This is kind of what you’d expect at a McArdle-branded blog:  that which ought to be true need not be checked.

But the tricky bit is that plausibility is all; the moment the reader’s willing suspension slips  — then you read everything else in the piece with attenae quivering.  Hence, I was ready when I took a second look at this gem:

 CDOs and credit default swaps don’t kill financial systems, mortgages kill financial systems.

Uh.  No.

As it happens, I’m not operating out of my usual sea of ignorance on this point, as my current project involves a deep dive into the first debt-for-equity swap in financial history.  The key fact most often ignored from that early period of finance is that though plenty went wrong, usually in ways that, frankly, aren’t materially different from the ways folks game and/or fail to grasp the system now, the core financial act of abstracting things into numbers is an enormously useful trick.  It is, truly, an engine of wealth.  See, e.g. Adam Smith, chapter IV of Book I of Wealth of Nations on the importance of a medium of exchange; currency is just the first step in the process by which finance mediates transactions.

In that vein, mortgage backed securities are like any tool; you can build a house with a hammer; you can also crush a harp seal’s skull.  It is all a matter of the user and the constraints that user’s society places on the deployment of such tools.  As my correspondent at MIT put it, there are three clear points of vulnerability inherent in the process of packaging individual mortgages into a big clump:

1). Originators do not have skin in the game and may try to pass off bad loans as good.
2). Rating agencies are paid by the pool creators rather than the investors (who are unknown at the stage when ratings must occur).
3). Special servicing needs a better business model. (TL: I.e., those who handle troubled or in-foreclosure mortgages need to do it right, which isn’t happening)

All of these are known flaws.  All of them are subject to regulatory responses.  My interlocutor again:

Until the 100 year flood #3 was never problematic. As for #1 and #2 as long as F&F were functioning as a public entity they monitored and disciplined originators and rating agencies with bad records. 800 lb gorillas can do that.  So a huge monopsonistic mortgage conduit actually overcame the intrinsic problems with MBS – and in my view should simply be turned into a non-profit public utility!

The alternative to MBS is to return to individual loan underwriting, retention and servicing.  We could certainly choose to say hello to all that, but at a cost — not a trivial one — that in the end would make the price of money for housing detectably higher.

This isn’t a terrifically complicated idea:  from its emergence in the 18th century, the bond market has lowered the cost of capital applied to all kinds of stuff in the real world, beginning, more or less, with the British Empire.  (See, for example, the brief essay buried about 2/3rds of the way through Volume II of Fernand Braudel’s Civilization and Capitalism, which gave me my first glimpse of the role of liquid capital markets and Britan’s rise to world-power.

All of which is to say that the derangement of the mortgage market in the United States was indeed a major and growing problem through the ‘oughts, compounded by an ideological commitment that prevented regulation everyone with an economics IQ higher than a plant’s understood to be necessary.  But even if the collapse of the housing market provided the spark for global financial disaster, the fuel for that inferno came not from the securities constructed directly out of home loans, but from their derivatives.  And as it is in derivatives that a whale’s share of the money can be made (at least until the music stops) those on Wall St. resisted and still resist not just regulation of those instruments, but any real discussion of their significance.

But here’s the blunt reality of modern finance: the scale of the derivatives market vastly exceeds that of the real economy that underlies it.  The leverage — the number of dollars at risk  in excess of the value of the real assets from which such bets are derived — is what makes for catastrophe.  Dr. Manhattan’s airy confidence, as quoted above, that ” CDOs and credit default swaps don’t kill financial systems,” is more than wrong.  To the extent that it reflects accurately what folks on Wall St. actually believe, it’s terrifying.

Or, as my MIT wise man says, more gently:

Not sure your writer fully understands how CDO and CDS markets work, and how counter party risk is basically unmeasurable – making them horribly subject to a systemic meltdown.

I’m betting none of this comes as a surprise to anyone reading this; reality based communities tend to be able to count on both fingers and toes.  And I guess I’ve committed my usual sin of John Foster Dulles-ing what was, after all, a throwaway of a line and a thought.

But I do think it important to try to push over and over again one basic point: financial markets are essential; they fund real lives.  They are also prone to failure in ways that are unsurprising, and are, at least in part, subject to constraint by design.  To pretend that failure is at once impossible and inevitable, just one of those things (like cancer) that attends the messy business of being alive, is merely to ratify the transfer of wealth from most of us to those with their paws on the capital spigots.

Dr. Manhattan might say that he is merely directing our attention to the root cause of our ills — but it is to me notable that the instrument he wants to do away with is the one that lowers the cost of a mortgage to you and me, and those he wants leave untouched are what buys as 2008.

If it were McArdle herself who had written this, I’d add snark here.  But as I said up top, Dr. Manhattan is someone who has earned some benefit of the doubt.  He may simply have gotten this one wrong, which is a state that comes to us all; me certainly.  So I’ll leave it here….

Over to you all.

*Credit for that coinage (at least in my first hearing) to the king of the three dot columnists, the gone but by no means forgotten Herb Caen .

**In the Mark Twain sense of knowledge.

Images:  Frans Snyders, The Fishmonger, first half of the 17th century.

Benjamin West, The Death of General Wolfe, 1770.

None Dare Call It Murder

February 1, 2012

I’ve got just one quick note to add to the discussion of the Komen Foundation’s surrender to Greater Wingnuttia and the Global War on Women.

That would be that this decision is not just about the dollars.  It’s genuinely a matter of life and death  — of murder, really, with only the anonymity of the victims to obscure the the connection between act and consequence.*

Y’all may recall that I wrote along these lines about eight months ago in connection with Mitch Daniels’ decision to defund Planned Parenthood in Indiana.  (Yup, that Daniels — the hack our friends in literate Wingnutistan see as the great hope of the GOP).  Now we’re back again to run the numbers on what the removal of the services Planned Parenthood provides to women seeking preventative care for breast cancer will do.**

Here are the basic figures:  over the last five years, the Komen Foundation provided Planned Parenthood with sufficient support to pay for 170,000 breast exams and 6,700 referrals for mammography. The question of how frequent and how early a mammography program should be has been, shall we say, vigorously debated, but the issue gained some clarity last year with the publication of a large scale longitudinal study by Swedish researcher in which over 133,000 women were followed for a total of 29 years.

The results of this study provide low-end estimates for the lives saved by screening:  for every 414 or 519 women screened*** for seven years running, one breast cancer death would be prevented.  What’s more, the researchers emphasized that this is a conservative conclusion:

Evaluation of the full impact of screening, in particular estimates of absolute benefit and number needed to screen, requires follow-up times exceeding 20 years because the observed number of breast cancer deaths prevented increases with increasing time of follow-up.

I’m being deliberately dry in this telling, and I’m sure you can guess why:  I do not wish the conclusion to lose any of its force to misplaced snark.  The bald facts are grim enough.

How grim?  Take the most modest number from this study —519 women screened for each life saved.  That’s on the order of 13 women from the 6,700 screened with Komen Foundation money who get to live.****

Or:  that’s 13 women who will die for lack of those funds.

As I wrote about cervical cancer screening in Indiana:  we won’t know who those women are.  We will never know their names; who loved them; how many kids they will leave behind.  But if the total funds for screening in the system drop with the withdrawal of Komen Foundation support, they’ll be dead all the same.

Caveats, before I drop this “just the facts, Ma’am” tone:  this is a blunt, back of the envelope bit of arithmetic.  There are all kinds of factors that a real epidemiologist would consider before making any such bold claim.  Some of the obvious ones push the conclusion to a higher likely total of preventable deaths:  these women are being referred for screening, which suggests that someone had an inkling that they might be at risk.  Planned Parenthood sees a clientele that is likely to lack more health care services than the general population.  And there are the general points the original researchers made to suggest that the total of lives saved through screening would be greater than their baseline number.  There are probably factors that weigh in the other direction as well — one could imagine, for example, that the preliminary examinations turned up more aggressive cancers, which may have outcomes that mammographic detection does not much alter.  You get the point.  The reality of public health, medicine, and the basic biology of cancer is such that precise predictions are always wrong.

That said, the broader claim still stands:  there is a significant and growing body of evidence that regular mammographic breast cancer screening saves lives.  The converse follows:  withholding that screening means real people will suffer.

And here I’ll drop the pretense of dispassion.  The Komen Foundation’s decision links directly to illness, to death and loss and dreadful sorrow left behind.

Those losses can’t be called manslaughter either, not as I see it.  Preventable deaths that flow from lack of access to the standard of care are wholly predictable, even if the individual victims are not identifiable.  Those blocking access through want of funds know — or should — what will happen.  There’s nothing accidental about these outcomes.w

Which means that this isn’t just another salvo in the culture war.  This is nothing to be clever about in 850 word columns on the back pages of the Grey Lady.  This is not a bit of clever gamesmanship to rev up a base for whom just the name Planned Parenthood conjures up all their horrors of female agency.

This is real life, and real lives lost…and, once again, this is why this election matters so much.

*Yup.  Still working the refs for that Moore Award.

**Just to be clear:  for what follows, I’m assuming that these services are withdrawn, that the withholding of resources from the Komen Foundation doesn’t get made up somewhere else.

*** The spread is down to the details of data collection and analysis in the Swedish study.

****The weasel is about the difference in the five year span of screening Komen funds are said to cover, and the seven year screening sequence identified in the Swedish study.  I lack both the data and the skill to do more than waffle a bit here.

Image:  Artemisia Gentileschi, Jael and Sisera, 1620

In Which I Find Myself In Total (and Gobsmacked) Agreement With Jeffrey Goldberg

November 30, 2011

If you want to know why supporting Israel — in any meaningful sense of the term — has to be different from supporting Likud/Netanyahu, check this out from Goldberg.  (If you don’t think that supporting Israel in any context is a good idea — well, we disagree, but you can still marvel at the Netanyahu administration’s truly impressive, the-wheel-is-spinning-but-the-hamster’s-dead stupidity.)  Golberg’s concluding passage:

The idea, communicated in these ads [created by the Netanyahu govt. for American TV], that America is no place for a proper Jew, and that a Jew who is concerned about the Jewish future should live in Israel, is archaic, and also chutzpadik (if you don’t mind me resorting to the vernacular). The message is: Dear American Jews, thank you for lobbying for American defense aid (and what a great show you put on at the AIPAC convention every year!) but, please, stay away from our sons and daughters.

Let me go further:  not only is this latest absurdity proof that there is a vast gulf between a commitment to Israel and a defense of its current government — the two are actually in conflict.  Likud and Netanyahu and their further-right allies are doing lots of things that I think weigh down the long-term prospects for Israel’s survival.  But I have to say that if they want to make things worse much sooner, potentially alienating a significant  fraction of the most committed American supporters of Israel is a pretty good way to go about it.

To steal a term:  Morans!

Image: Jozef Israëls,A Jewish Wedding, 1903


Follow

Get every new post delivered to your Inbox.

Join 8,401 other followers