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August 2006

Was David Broder Always *This* Stupid?

Why oh why can't we have a better press corps.

Yes, Washington Post, each David Broder column you publish flushes your reputation further down the toilet.

Yesterday he wrote:

Voter Anger That Cuts Both Ways: when I went to Connecticut three weeks before the primary, it was evident that he was going to be overwhelmed by the passion to "send a message" through Lamont of frustration with the war in Iraq, the Bush presidency and Congress. Lieberman, as I wrote, represented a candidacy, while Lamont embodied a cause -- and it was clear that the cause would prevail...


Simply no.

Not true. A switch of two percent of the voting electorate would have given Joe Lieberman a victory. If Joe Lieberman had announced that he was going to live or die by the result of the Democratic primary, spent his $2 million in the bank on the primary, and gotten all the extra Democratic politicians who would have been happy to campaign with him under those conditions into the state--he would have won. If Lieberman had made up his mind whether Lamont was really a Republican from Greenwich or a tool of the far left that believes Osama bin Laden is not a threat, he would have won. If Lieberman had been willing to talk this spring about how Bush could handle the situation in the Middle East better--he would have won. If Lieberman had been willing to call for mass resignations from the Bush administration for failed implementation--he would have won.

Lieberman had to work very hard to lose this one. In claiming that "it was clear" that Lamont would prevail, David Broder is simply being a very rare species of idiot.

But that's not all!

Broder writes:

Lamont found his most prominent support on the far-left flank of the Democratic Party. His organization was a hand-me-down from the Howard Dean presidential campaign, bolstered by a blizzard of Internet blogs from outside his home state. His roster of visiting campaigners was uniformly of the same political slant -- notably Jesse Jackson, Al Sharpton and Rep. Maxine Waters of California...

That's equally stupid. In contrast to this garbage, the shrill and reality-based Gail Collins and her posse put her finger on it as they write:

Revenge of the Irate Moderates - New York Times: Ned Lamont, a relative political novice, said he ran against Mr. Lieberman because he was offended by the senator's sunny descriptions of what was happening in Iraq and his denunciation of Democrats who criticized the administration's handling of the war. Many other people in Connecticut may have felt that sense of frustration, but no one else had the money and moxie....

Mr. Lieberman's supporters have tried to depict Mr. Lamont and his backers as wild-eyed radicals.... It's hard to imagine Connecticut, which likes to be called the Land of Steady Habits, as an encampment of left-wing isolationists, and it's hard to imagine Mr. Lamont, who worked happily with the Republicans in Greenwich politics, leading that kind of revolution.

The rebellion against Mr. Lieberman was actually an uprising by that rare phenomenon, irate moderates.... A war that began at the president's choosing has degenerated into a desperate, bloody mess that has turned much of the world against the United States. The administration's contempt for international agreements, Congressional prerogatives and the authority of the courts has undermined the rule of law abroad and at home.... [T]he political discussion in Washington has become a captive of the Bush agenda. Traditional beliefs like every person's right to a day in court, or the conviction that America should not start wars it does not know how to win, wind up being portrayed as extreme. The middle becomes a place where senators struggle to get the president to volunteer to obey the law when the mood strikes him. Attempting to regain the real center becomes... radical...

And, of course, Broder commits further acts of stupidity:

Lieberman could claim 18 years of Senate seniority... a reputation for personal integrity...

I do not believe that Michael Schiavo sees Lieberman as having any personal integrity whatsoever. Having seen Lieberman's response to being warned that the "delaying Social Security reform a year costs us $600 billion" Republican talking point he was using was false--Lieberman kept on using it--I don't see himn as having any personal integrity either. Nor did he show personal integrity when he blocked the attempts of the experts at the Financial Accounting Standards Board to reform the accounting treatment of options. Nor did he show personal integrity when he expressed his views on Abu Ghraib--that under Rumsfeld the U.S. army had been pulling random Iraqis off the street and torturing them for no particular reason: "We're in the middle of a war--you wouldn't want to have the secretary of defense change unless there's really good reason for it and I don't see any good reason at this time."

KQED Forum: The Federal Reserve and Interest Rates

What I did this morning:

KQED | Forum: Home: Thu, Aug 10, 2006 -- 9:00 AM: The Fed and Interest Rates

Forum discusses the impact of the Federal Reserve's decision not to raise interest rates. Host: Michael Krasny. Guests:

  1. Brad DeLong, professor of economics at the University of California, Berkeley

  2. Matthew Bishop, American business editor and chief business writer for The Economist

  3. Phillip Swagel, resident scholar of economics at the American Enterprise Institute

Discontinuities in Human History

Charlie Stross is annoyed that he has to spend time twiddling his thumbs in airports with a laptop with a dead battery:

Charlie's Diary: Travelling I'm catching a taxi to the airport at 5am tomorrow, and will subsequently take approximately 28 hours of travel to reach my destination. (Blogging will, therefore, be sparse until I recover from the jet lag).

Just a thought: the cost of an air fare to the antipodes today, in 2006, is on the order of one month's salary for a full-time skilled worker in the developed world. The journey takes 24-48 hours depending on stop-overs, and is somewhat uncomfortable.

This compares quite accurately to the price of a stage coach journey across the home counties of England in 1806.

We're not living in a global village, exactly, but the world has nevertheless shrunk unimaginably in scale in just two centuries, so that we become blasé about it — so that we get annoyed because Boeing 747s and Airbus 340s seem slow. What does this tell us about our expectations, beside the obvious?

Well, right now I'm annoyed that I cannot find an English translation of the early thirteenth century "Life of William Marshal," and that I will have to leave my eyrie eighty feet above the earth in this concrete-and-glass tower with its perfect view of the Golden Gate and walk a hundred yards to the library.

Twenty thousand years ago one of my ancestors was worrying about (a) being hunted down by the nastier thugs to the south with better spears, (b) the fact that this northern land to which the band had fled was cold, and (c) that the bones of his children with darker skin did not seem to be growing straight.

I think this tells us that the Singularity already happened--although I'm agnostic as to whether it really happened in 4000 BC with Gilgamesh of Uruk, 1000 BC with Ish-Ball of Tyre, 1460 with Johann Gutenberg of Mainz, or 1995 with Tim Berners-Lee of CERN...

Daniel Gross on Joe Lieberman

Daniel Gross watches Joe Lieberman:

Daniel Gross: August 06, 2006 - August 12, 2006 Archives: PISSED-OFF YUPPIE WATCH: Well, Joe Lieberman lost yesterday. And it wasn't legions of blog-reading leftists that did him in. (There aren't many leftists in Connecticut.) No, it was legions of angry, well-off, highly educated professionals -- yuppies -- who did him in. Check out the vote total by town, conveniently supplied by the Hartford Courant.

Lieberman did quite well in blue-collar, working-class redoubts like Bridgeport, East Hartford, Norwich, and Waterbury.

But Lamont racked up big margins in the tony towns of the shore (Madison, Clinton), in Litchfield County (Kent, Litchfield), and especially in Fairfield County. In Greenwich and New Canaan, Wilton and Weston, Darien and Westport, Lamont won by nearly 60-40 margins. By their hundreds and thousands, my neighbors left their million-dollar-plus homes, got in their hybrid SUVs and Volvo station wagons, and registered their displeasure. In Bushenfreude central -- Westport -- 57.6 percent of the town's registered Democrats turned out for the primary, a huge figure, and they went for Lamont by a big margin. And the vast majority of them have still never heard of DailyKos. In fact, the higher the town's median income, it seems, the bigger majority Lamont received.

This morning on the "Today" show, Lieberman closed out his interview with Anne Curry by saying something to the effect that he was going to continue to run, in part, because he wanted to save the Democrats from becoming the party of "Ned Lamont and Maxine Waters." Hmmm. He may be trying to get on the ballot as an independent, but he's already running like a Republican.

Robert Waldmann Politely Says He Thinks I Have Got the Carrot/Stick Balance Wrong...

Well, I wouldn't say "peace" with Tom Ricks. To my view, the excellence and the... strong nature of Ricks's conclusions in Fiasco make the tone of Washington Post Iraq coverage in 2002, 2003, and 2004 that much more reprehensible. One would, I think, have gotten a much better idea of what was going on back then by ditching Ricks and the Post and relying on Knight-Ridder and the Manchester Guardian.

Apropos of which, here's a snippet from Tom Ricks today:

"I have the blood of American troops on my hands.": Reporter and Fiasco author Tom Ricks:

I asked one officer, "Why are you talking to me about these things?"

And he looked down at his hands, and he said, "Because I have the blood of American troops on my hands."

And I said, "What do you mean?"

And he said, "Because when I said to Rumsfeld we need that division, and Rumsfeld said no, I gave up. I compromised." And he said, "U.S. troops died because of that." And he said, "That's why I'm talking to you."... And he was practically crying as he spoke to me about this...

That should be read alongside this exchange between Ricks and Kurtz:

KURTZ: [Y]ou write, quote, in the run-up to the war, quote, "The media didn't delve deeply enough into the issues surrounding war, especially the threat of Iraq and the cost of occupying and remaking the country. We're seeing those costs right now." Why didn't the media delve more deeply? Was there a certain level of intimidation?

RICKS: I don't think it was so much as intimidation... Congress didn't hold hearings in which credible information was presented that said, no, the administration's case is wrong.

KURTZ: Since when do reporters have to wait for Congress to hold hearings?

RICKS: ...Congress... the engine of government. And if Congress is asleep... at some point your editors say, why do you keep writing about doubts about this war, when it's going to happen?

KURTZ: Do you include yourself in this indictment? Did you run into that kind of skepticism from your "Washington Post" editors?

RICKS: Absolutely. There was a sense that, look, this thing is going to happen. You've written a lot of stories about the doubts about the war. Give us more stories about the war plan, because it is going to happen, whether or not all these generals oppose it....

However, Fiasco is quite good.

All this is prelude to the fact that I think Robert Waldmann has interesting things to say:

Robert's Stochastic thoughts: Brad DeLong makes peace with Tom Ricks first by telling people to listen to him on the radio and now in this interesting post. I thought I had something useful to say about it, but I don't so I won't pollute Brad's comment thread with my comment which I dump here.

I remember reading Ricks's explanation years ago, written by Michael Ignatieff (sp? google won't show it to me), about how reporters didn't report the truth on Iraq because of their "professionalism" which requires them to present views that range from the mainstream of the Democratic party to the [mainstream of the Republican party] loony right.

Evidently Kucinic and and the love-one-another caucus aren't mainstream enough to count (Drew agrees and so do I).... This is, as has been noted by many people, absolutely awful. If the press is obliged to accept the conventional wisdom (of politicians: most ordinary people weren't on board yet) then they are worthless.

Ricks... says his editors said there was no need to inform a debate about whether Iraq should be invaded, because [invasion] was going to happen anyway.... The slogan appears to be "don't speak truth to power"... what Drumheller claims he was told when he expressed doubts about Curveball. This definitely has nothing to do with finding and reporting the truth... the Post's editors do not see their job as informing their readers but rather as influencing politicians. Only powerful people count. If they agree, the matter is decided. The public doesn't matter.

[T[he dread Kurtz line about "objective"... Auros puts it exactly right

Kurtz has -- like most media figures -- confused "objective" and "impartial". If one has a liking for -- a partiality towards -- actual, factual truth, then it is difficult to remain impartial in the face of lies and stupidity....

It is not enough to refrain from drawing conclusions without proof, it is necessary to draw no conclusions even if there is proof.... [Ricks[ interprets [Kurtz's] question as one about being frozen out by the Defense Department, or maybe he interprets as an accusation that he is not supporting the troops. Now... answering the question that Kurtz should have asked might be a diplomatic way to avoid accepting Kurtz's premise, but... there is a third meaning of "objective"[:] "one should be objective" = "one should reach no conclusions even with proof beyond reasonable doubt" = "one should maintain access"....

[These meanings] have become confused leaving reporters vulnerable to the Rovian technique of giving access only to people who would write "opinions about shape of earth differ."... [A] failure of the invisible hand (which guides the marketplace of ideas as well as the marketplace)... the selfish aim to be a top reporter is useful... [if] the way to be a top reporter is to report interesting and important news. However, some reporters (and newspapers) are prominent because they get the top leaks.... The effort to get the leaks serves the selfish aim of the reporter who wants to be important but it adds nothing to the information available to readers. Reporters who put a pro-administration spin on the leaks they get are serving their own interests at the expense of the public interest.

Now it should be possible to change this, because a lot of what reporters are after is bragging rights. The condemnation of source-buffing reporting on the web might alleviate the problem.

On the other hand, the proper use of carrots and sticks is to whack those who misbehave and give carrots when they reform. The Brad and Billmon approach has been to remind the reformed of their past misdeads. This does not creat useful incentives, so I am very glad that Brad has made peace with Ricks.

Why Oh Why Can't We Have a Better Press Corps? (New York Times, Los Angeles Times, Washington Post, Associated Press, NBC, CBS, and Fox News Edition)

Outsourced to Charles Kaiser of NYO:

NYO - Wise Guys: Rumsfeld Lies, Press Takes a Nap: Once upon a time, it was considered news when a senior official in Washington blatantly lied to a Senate Committee. No more. If the Bush administration has proven anything, it is that the Big Lie is just as effective today as it was 60 years ago.

One of the most egregious examples of this occurred a few days ago when Senator Hillary Clinton challenged Secretary of Defense Donald Rumsfeld over his constant optimism about Iraq. “I know you feel strongly about it,” she said, “but there’s a track record here. This is not 2002, 2003, 2004, ’5, when you appeared before this committee and made many comments and presented many assurances that have, frankly, proven to be unfulfilled.”

“Senator,” Mr. Rumsfeld replied, “I don’t think that’s true. I’ve never painted a rosy picture. I’ve been very measured in my words. And you’d have a dickens of a time trying to find instances where I’ve been excessively optimistic.” Oh, so homey, so Rumsfeld-esque—and so utterly absurd. And yet this is how America’s leading news organizations covered this exchange:

The Washington Post and The New York Times didn’t quote this part of their exchange at all. The Los Angeles Times said Mr. Rumsfeld “issued a point-by-point defense and insisted that he had not been overly positive about Iraq.” The Associated Press and NBC Nightly News ended their stories with Mr. Rumsfeld’s denial and offered no rebuttal of it. The CBS Evening News noted that Mr. Rumsfeld “disputed” Clinton’s contention that he had painted an overly rosy picture. Chris Wallace reported on Fox News that “Rumsfeld gave as good as he got.”

Now it took me five minutes and three Google searches to produce a slew of evidence that the Defense Secretary was telling a whopper. Last December, The Washington Post reported that “Defense Secretary Rumsfeld today urged Americans to be more optimistic about the situation in Iraq, saying that people on the ground there have more optimistic views than what is being portrayed in the U.S. media.” Tim Russert quoted Senator Chuck Hagel on Meet the Press last year as saying “things aren’t getting better, they’re getting worse,” to which Mr. Rumsfeld responded, “That’s just flat wrong. We are not losing in Iraq.” And so on.

It may be too much to ask these harried reporters to perform three Google searches on deadline. But Senator Clinton had actually anticipated that. After Mr. Rumsfeld spoke, she inserted into the record her own list to prove her point: seven quotes from Mr. Rumsfeld in front of Congressional committees—-including “My impression is that the war was highly successful,” and “I do believe we’re on the right track”—-and another six from press interviews. These included such memorable lines the following: “I can’t tell you if the use of force in Iraq would last five days, or five weeks, or five months, but it certainly isn’t going to last any longer than that.” And, of course, this one, in response to a question from Jim Lehrer in 2003 asking how American troops would be received in Iraq: “There is no question but that they would be welcomed.”

But none of the leading newspapers or networks offered a single one of these examples in their stories about the day’s hearing—or even mentioned the fact that Senator Clinton had submitted such a list.

Most of them also failed to challenge any of Mr. Rumsfeld’s other lies during the same appearance, including his claim that the number of troops on the ground “reflected the best judgment of the military commanders on the ground [and] their superiors.” (Actually, the Army’s chief of staff, Gen. Eric Shinseki, told Congress before the war that “something on the order of several hundred thousand soldiers” would be required for an occupation of Iraq” and was rewarded for his prescience with early retirement.)

On the Web, of course, it was a different story, with a number of prominent blogs reproducing Mrs. Clinton’s rebuttal in its entirety.

I am a diehard defender of the mainstream media. But it’s getting harder all the time to remain that way...

Signs of the Times in Iraq

From Spontaneous Arising:

Spontaneous Arising: Democracy and the Return of the Hijab: Riverbend (aka, "Baghdad Blogger") goes back in time:

For me, June marked the first month I don't dare leave the house without a hijab... it's no longer possible to drive around Baghdad without one. It's just not a good idea. (Take note that when I say "drive" I actually mean "sit in the back seat of the car"--I haven't driven for the longest time.) Going around bare-headed in a car or in the street also puts the family members with you in danger. You risk hearing something you don't want to hear and then the father or the brother or cousin or uncle can't just sit by and let it happen...

This in a Middle Eastern country (Iraq) that once prided itself on the relative freedom of women, who could have a profession, drive a car and walk around without hiding their faces. The neocon steamroller approach to "giving birth" to the New Middle East is truly a thing to behold. Unfortunately for humanity, the steamroller is running on automatic, and it has a full tank of diesel.

Impeach George W. Bush. Impeach him now.


Ah. We all sensed a great disturbance in the Joementum.

Let everyone thinking about supporting Joe Lieberman think hard about who Joe Lieberman has turned himself into.

Remember this?

New Haven Independent: The Bear Is Back: Lieberman's new ad... same DC consultant hit man, Carter Askew.... It portrays Lamont as a whining, hop-about baby who doesn't want to run against Lieberman because he previously gave Lieberman a campaign contribution. "But I agree with the Republicans 80 percent of the time!" cartoon Lamont protests in a shrill toddler's voice....

Lieberman... [claims that Lamont] he sides with right-wing Republicans on the issues most important to Connecticut Democrats these days.... [T]the Lieberman team has pursued a strategy of relentlessly labeling Lamont the Republican. Why? Because 12 years ago, as a Greenwich selectman, he and other Democrats voted alongside Republicans on some non-ideological town issues. The Lieberman has further portrayed Lamont as anti-schoolchildren and anti-health care. The basis for that: He voted for a final budget that cut a requested health department budget increase from 12 to 6 percent. He voted against a $35 million school renovation project that included an asbestos clean-up because he wanted an independent audit. And he joined a unanimous vote to require top-level school administrators to pay the same increase in health care expenses as unionized town employees.

Lieberman himself called for an end to such old-record-twisting character-assassination ads in his book In Praise of Public Life. He wrote that in 2000, when he didn't have a serious challenger to his Senate seat....

About Lieberman's ads, the Manchester Journal-Inquirer... recently editorialized: "The whole point of being Joe Lieberman used to be decency, dignity, and thoughtfulness. Lieberman's attack ads look like the appeals of just another sleazy, desperate pol, grasping madly to hold on to office."

And, of course, this morning:

Eschaton: LAUER: Senator, is there any phone call you could receive? Is there anyone in the Democratic Party who could call you today and ask you to drop out that you would listen to?

LIEBERMAN: Respectfully, no. I am committed to this campaign, to a different kind of politics, to bringing the Democratic Party back from Ned Lamont, Maxine Waters to the mainstream...

So Lieberman's problem with Ned Lamont is that Lamont votes both with the richest people in the world--the Republicans of Greenwich--and with Maxine Waters, African-American House of Representatives member from one of the poorest parts of Los Angeles.

That's a neat trick.

I guess Joe Lieberman's not courting the African-American voters of Connecticut anymore.

Why Oh Why Can't We Have a Better Press Corps? (New York Times Edition)

Outsourced to Media Matters, which watches Adam Nagourney of the New York Times fail the Turing test:

Media Matters - NYT 's Nagourney contradicted his own reporting to suggest Dems in disarray: In an August 9 article about Ned Lamont's victory over incumbent Sen. Joseph I. Lieberman in the Connecticut primary, New York Times reporter Adam Nagourney suggested that the Democratic Party is "still struggling to arrive at a unified position" about Iraq. But just eight days earlier, Nagourney began an article with a reference to the Democrats' "unified statement" in favor of a phased redeployment of troops from Iraq. From Nagourney's August 9 article in The New York Times:

[E]ven before the results were known, the accepted wisdom in political circles was that a victory by Mr. Lamont would signal there is little room in the Democratic Party for Iraq war supporters, an unwelcome event for a party still struggling to arrive at a unified position about the war, and elevate the influence of bloggers.

From Nagourney's August 1 Times article:

Leading Congressional Democrats, after months of division over Iraq, have called on President Bush to begin a phased redeployment of troops by the end of this year, a unified statement signaling they have concluded that the war could hurt Republicans in the midterm elections. The letter called on American forces in Iraq to make a transition to a ''more limited mission'' dealing with counterterrorism and training and logistical support of Iraq security forces.


[T]he fact that most of the Democratic leadership had unified around a position -- and presented it so forcefully -- strongly suggests that the politics surrounding the war are changing.

Which is it? Is the party "struggling to arrive at a unified position"? Or is there "little room ... for Iraq war supporters"? Or are both statements simply mindless recitation of flawed anti-Democrat storylines?

Department of "Huh?"

The Swamp loses itself in a swamp:

The Swamp - Chicago Tribune - Blogs.: Lieberman could be losing Posted by Jon Lender, Elizabeth Hamilton and David Owens at 9:20 pm CDT, and updated at 9:45 pm: Sen. Joe Lieberman is sweating tonight: With nearly 72 percent of the state's precincts reporting just before 9 pm CDT, the Connecticut Democrat was trailing challenger Ned Lamont by 51.6 to 48.4 percent. The vote tally was 100,425 for Lamont and 94,148 for Lieberman. But the more votes were counted tonight, the narrower the margin grew: With 83 percent of all precincts reporting, it was Lamont 120,616, Lieberman 111,887.

Since when is 8,729 "narrower" than 6,277?

May we ask for some arithmetic here?

Why oh why can't we have a better press corps?

Hoisted from Comments: Conflicts of Interest in American Finance

Chistofay writes

Decent fund managers. That sounds like a list that can be counted on one hand, does anyone take up that dare?

While I'm a capitalist and a pro-capitalist at that, I might be too cynical to attempt making a list. I would not include the home-town heavy Fidelity as I've read too much on how Fidelity might have traded its fiduciary/independent responsibility to lunch at the table with Fortune 500 upper management to be declared decent. Fidelity does not vote "fiduciary" but "management-support". It gets the big 401 K (K-strikeout for the mid class) management contracts by wink-wink nudge-nudge won't vote againist management quid pro quo.

One of the many projects so far on the back burner that I don't know when or if I will ever get to it is to try to roughly quantify these major conflicts-of-interest in American finance:

  • You give us your company's investment banking business, and we'll put you personally on the list of those offered underpriced shares in IPOs.
  • You give us your 401(k) business, and we'll vote the shares of those who have invested in our mutual funds for the incumbent management.
  • You give me a cushy directorship, and I'll vote for whatever compensation you want as CEO

There are others. But how big a deal are all of them, taken together?

Public Sector Defined Benefit Pensions

Dean Baker tells us to add this to the pile:

Beat the Press: The Problems of Public Pensions: Mary Williams Walsh has a nice piece on the unbooked libailities of public sector pension funds in today's NYT. Supporters of defined benefit pensions and public sector provision of public services are not helping the cause when they ignore bad accounting.

Lieberman Campaign Middlemen...

UPDATE: 2dogmedia corrects the record, saying that it has been months since they had anything to do with Lieberman:

Wonkette writes:

Lieberman Campaign's Website Woes Own Damn Fault - Wonkette: Why the hell is Joe Lieberman's campaign site hosted by these people [] (site down -- probably not because of dirty deeds, by the way) under the cheapest plan available? And why do Lieberman's FEC filings say he's paying $1500 to a different company for web hosting? No, we seriously want to know. These aren't rhetorical questions.

We have to assume that Lieberman paid the guys named above (click to enlarge slightly) to find hosting, and "2 Dog Media" went with the cheapest option available, using the rest of their paycheck to buy Ecstasy or whatever Internet people ingest. With Friends of Joe Lieberman like this, etc.

UPDATE: Funny picture added for people who don't care about FEC filings.

UPDATE2: Ha ha ha:

2Dog Media has had many experiences with bad hosting companies. From sites not being available to e-mails getting lost, we know the hardships of finding a good hosting company. You lose money, clients, and credibility during those times. That's why we do the worrying for you and make sure your website is constantly accessible with our hosting product. Get hosting, a domain name, and e-mail for one low price.


Accelerando! Chad Orzel writes:

Uncertain Principles: The Sorry State of Genre Fiction: I also think there's a problem here with changing audience expectations regarding the pace of a story. The effect is probably easier to see in movies, particularly if you do something like watching the original and the remake of The Italian Job in close proximinty-- the re-make moves a lot faster, and to modern eyes, the original is really, really slow. You couldn't make a caper movie that moved at the pace of the original Italian Job these days without getting blasted by critics and audiences-- look at The Score with Robert DeNiro, for example.

I think the same thing has happened with books, to a large degree. A lot of older SF seems really slow and clunky to modern readers coming upon it for the first time. Which is why I'm skeptical about people recommending tons of Heinlein juveniles as "the best way to hook new readers." They may have worked fifty years ago, but audience expectations have changed, and kids raised on modern storytelling conventions (in cartoons, tv, and videogames) may not find it as gripping.

This ties into the science thing because the expectation of faster pace makes it that much harder to sneak in explanations of "good science." If you expect the story to move at a fairly leisurely pace, you're less likely to be bothered by an "As you know, Bob,..." discussion of rocketry (or whatever) than someone who's expecting things to move along a little more briskly.

This is turning out to be even more rambling and incoherent than I expected, so I'll stop typing now. I do recommend reading all three of the linked pieces, though, and the associated comments. And I may come back to some of this later.

I have noticed this as well: we are demanding more information from all of our media than our predecessors did. As one friend says, watching old movies on TV has become painful--unless you can watch three at once, channel-surfing between them and puzzling out what happened in the parts of each that you missed. It's an interesting phenomenon, if it is a phenomenon.

The Federal Reserve Waits and Sees...

The Federal Reserve pauses, and keeps interest rates the same:

Release Date: August 8, 2006

For immediate release

The Federal Open Market Committee decided today to keep its target for the federal funds rate at 5-1/4 percent.

Economic growth has moderated from its quite strong pace earlier this year, partly reflecting a gradual cooling of the housing market and the lagged effects of increases in interest rates and energy prices.

Readings on core inflation have been elevated in recent months, and the high levels of resource utilization and of the prices of energy and other commodities have the potential to sustain inflation pressures. However, inflation pressures seem likely to moderate over time, reflecting contained inflation expectations and the cumulative effects of monetary policy actions and other factors restraining aggregate demand.

Nonetheless, the Committee judges that some inflation risks remain. The extent and timing of any additional firming that may be needed to address these risks will depend on the evolution of the outlook for both inflation and economic growth, as implied by incoming information.

Voting for the FOMC monetary policy action were: Ben S. Bernanke, Chairman; Timothy F. Geithner, Vice Chairman; Susan S. Bies; Jack Guynn; Donald L. Kohn; Randall S. Kroszner; Sandra Pianalto; Kevin M. Warsh; and Janet L. Yellen. Voting against was Jeffrey M. Lacker, who preferred an increase of 25 basis points in the federal funds rate target at this meeting.

Heavier Macroeconomic Weather

Dean Baker sees more signs of choppier macroeconomic waters starting... RIGHT NOW!

Beat the Press: Dean Baker's commentary on economic reporting: More Evidence of a Bursting Housing Bubble

New data from the Fed show that credit card debt rose at a 9.8 percent annual rate in June after increasing at an 11.0 percent rate in May. This extraordinary two-month rise is consistent with the story that homeowners are finding it increasingly difficult to borrow against their home – presumably because prices are no longer rising. If you need to borrow, and borrowing against the home is not an option, credit cards may be the next best alternative.

A sidebar on home prices: all of our standard house price series use contracted sales prices to measure price changes. This could be leading to an overstatement of current prices, and therefore concealing price declines. The reason is that in many bubble areas it has become common for sellers to offer various inducements – for new homes, builders offer free additions/alterations. For existing homes, sellers offer help on closing fees, one-year of condo fees, etc. Check the real estate listing to get a sense of what’s being offered in your area.

Anyhow, since these kickbacks are not deducted from the sales price, the sales price entered in the various house price indices will be higher than the effective sales price. Without some serious investigation of the size or frequency of these seller kickbacks, it is impossible to know how large they are relative to the price, but it is certainly possible that they could be leading to a substantial overstatement of prices in some of the most affected areas.

*Sigh* It's Donald Luskin Time. It's Donald Luskin Time.

Every once in a while it is my painful duty to surf over to and document that Donald Luskin, who regularly trashes Paul Krugman in the "Paul Krugman Watch" column for National Review is... not an unarmed man in a battle of wits, it's worse than that... say merely that if he had a contest with Wile E. Coyote, Wile E. Coyote would emerge the clear winner.

So with enough Dutch courage in me to view the train wreck, I surf on over and find that today, August 7 2006, Donald Luskin is claiming that Paul Krugman "officially says [that a recession] is here." But Luskin's wrong. What Paul writes is:

Intimations of Recession - New York Times: The latest job numbers show falling employment in home construction, and retail employment has fallen over the past year, suggesting that consumer spending is running out of steam... neither business investment nor exports seem to be growing fast enough to make up for the housing slump. Now maybe we will still manage that soft landing despite a rapidly rising number of unsold houses; or maybe there is a boom in business investment and/or exports just over the horizon. But based on what we know now, there is an economic slowdown coming. This slowdown might not be sharp enough to be formally declared a recession. But weak growth feels like a recession to most people...

And I find Donald Luskin also claiming that Paul Krugman has declared that the U.S. economy is in recession "over and over during the past three booming years." He even provides links to three Paul Krugman columns:

The Conspiracy to Keep You Poor and Stupid: So I guess Krugman wasn't "serious" before, those times when he declared a recession over and over during the last three booming years (for instance here and here and here).

Of course Donald Luskin is wrong, again. In the first case Luskin points to, Krugman doesn't declare that the economy was then--summer 2004--in a recession. Instead, Paul says:

The Unofficial Paul Krugman Web Page: Summer 2004: When does optimism -- the Bush campaign's favorite word these days -- become an inability to face facts? On Friday, President Bush insisted that a seriously disappointing jobs report, which fell far short of the pre-announcement hype, was good news: "We're witnessing steady growth, steady growth. And that's important. We don't need boom-or-bust-type growth."

But Mr. Bush has already presided over a bust. For the first time since 1932, employment is lower in the summer of a presidential election year than it was on the previous Inauguration Day. Americans badly need a boom to make up the lost ground. And we're not getting it.

When March's numbers came in much better than expected, I cautioned readers not to make too much of one good month. Similarly, we shouldn't make too much of June's disappointment. The question is whether, taking a longer perspective, the economy is performing well. And the answer is no.

If you want a single number that tells the story, it's the percentage of adults who have jobs. When Mr. Bush took office, that number stood at 64.4. By last August it had fallen to 62.2 percent. In June, the number was 62.3. That is, during Mr. Bush's first 30 months, the job situation deteriorated drastically. Last summer it stabilized, and since then it may have improved slightly. But jobs are still very scarce, with little relief in sight.

Bush campaign ads boast that 1.5 million jobs were added in the last 10 months, as if that were a remarkable achievement. It isn't. During the Clinton years, the economy added 236,000 jobs in an average month. Those 1.5 million jobs were barely enough to keep up with a growing working-age population...

In the second example, Paul Krugman doesn't declare that the economy was then--spring 2005--in a recession. Instead, Paul says:

The Unofficial Paul Krugman Web Page: Spring 2005: In the 1970's soaring prices of oil and other commodities led to stagflation - a combination of high inflation and high unemployment, which left no good policy options. If the Fed cut interest rates to create jobs, it risked causing an inflationary spiral; if it raised interest rates to bring inflation down, it would further increase unemployment.

Can it happen again?

Last week fears of a return to stagflation sent stock prices to a five-month low. What few seem to have noticed, however, is that a mild form of stagflation - rising inflation in an economy still well short of full employment - has already arrived.

True, measured unemployment isn't bad by historical standards, and inflation is in the low single digits. But inflation is creeping up, and it's doing so despite a labor market that is in worse shape than the official unemployment rate suggests.

Let's start with the jobs picture. The official unemployment rate is 5.2 percent - roughly equal to the average for the Clinton years.

But unemployment statistics only count those who are actively looking for jobs. Every other indicator shows a situation much less favorable to workers than that of the 1990's. A lower fraction of the adult population is employed; the average duration of unemployment - a rough indicator of how long it takes laid-off workers to find new jobs - is much higher than it was in the 1990's. Above all, the weak job market leaves workers with no bargaining power, so they aren't getting ahead: wage increases have been minimal, and haven't kept up with inflation.

Underlying these disappointing numbers is sluggish job creation. Private-sector employment is still lower than it was before the 2001 recession. Things could be, and have been, worse. But those whose standard of living depends on wages, not capital gains - in other words, the vast majority of Americans - aren't feeling particularly prosperous. By two to one, people tell pollsters that the economy is "only fair" or "poor," not "good" or "excellent." Why, then, has the Fed been raising interest rates? Because it is worried about inflation, which has risen to the top end of the 2 to 3 percent range the Fed prefers.

What's driving inflation? Not wages: labor costs have been falling, because wages are growing less than productivity. Oil prices are a big part of the story, but not all of it. Other commodity prices are also rising; health care costs are once again on the march. And a combination of capacity shortages, rising Asian demand and a weakening dollar has given industries like cement and steel new "pricing power."

It all adds up to a mild case of stagflation: inflation is leading the Fed to tap on the brakes, even though this doesn't look or feel like a full-employment economy.

We shouldn't overstate the case: we're not back to the economic misery of the 1970's. But the fact that we're already experiencing mild stagflation means that there will be no good options if something else goes wrong...

And in the third example, Paul Krugman does not declare that the economy was then--spring 2003--in recession. Instead, Paul says:

The Unofficial Paul Krugman Web Page: Spring 2003: Over the last two weeks, nobody has been paying much attention to economic news; even the ups and downs of the Dow have reflected reports from the battlefield, not the boardroom. But the economic news is quite worrying. Indeed, the latest readings suggest that our recovery, such as it is, may be stalling.

Actually, the recovery can't officially stall since it hasn't officially begun: the committee that rules on such matters still hasn't declared the recession that began in March 2001 over. There are good reasons for the committee's hesitation: while G.D.P. started growing in late 2001, the job situation -- which is what matters to most people -- has more or less steadily worsened. In particular, fewer people are working now than were employed a year ago. Since the working-age population continues to rise, jobs have become steadily harder to find.

Still, the latest data suggest that the rate at which things are getting worse is accelerating. In February, payroll employment fell by 308,000 %u2014 the worst reading since November 2001. Some analysts suggested that number was a fluke, distorted by bad weather, but yesterday there were two more worrying indicators: new claims for unemployment insurance jumped, and a survey of service sector companies suggests that the economy as a whole is contracting. Now what? Ever since hopes of a rapid recovery faded last summer, the economy has seemed balanced on a knife-edge. Pessimists like Stephen Roach of Morgan Stanley warn that the U.S. is near its "stall speed": growth so slow that consumers, nervous about a weak job market, cut back on spending and send the economy into a tailspin. Yet optimists keep expecting businesses, anxious to update their technology, to resume large-scale investment and create a robust recovery. Both outcomes are still possible, but it seems increasingly likely that consumers will lose their nerve before businesses regain theirs...

I could pile on: I could point out that although Paul Krugman wrote in April 2003 that the economy might (not was: might) be in or fall back into recession, Donald Luskin has written since that he has a "better theory... using a different date for the end of the recession... April 2003." I could ask why the other regular writers for National Review haven't begged the editors to drop Luskin to stop the damage to their reputations (some claim that they have done so).

But what's the point? The only useful thing to do is to lay down a marker stating how ridiculous he is, and move on.

The intellectuals have taken over the asylum / Home UK / UK - The intellectuals have taken over the asylum: By Jurek Martin: I began to realise that the American neo-conservative movement had become truly unhinged when a columnist I normally respect equated an ideologue I do not with Winston Churchill. The writer was David Brooks in the New York Times and his Churchillian doppelgänger was William Kristol, who sees existential threats to America everywhere and now believes bombing Iran is perfectly all right.... If Kristol was Churchill, he wrote, George Will, the prim columnist who now doubts regions of the world can be transformed on an American whim, had to be Burke....

The arrogance that makes these comparisons possible is actually quite disturbing.... It is not clear to me that Kristol, living in his salon bubble and TV studios, has ever seen the world other than as he thinks it should be.... Others of his ilk, Robert Kagan, Charles Krauthammer et al, and those not of the neo-con persuasion, like the sainted Thomas Friedman, have also taken refuge in blaming incompetent execution by the Bush administration rather than questioning the advice they so freely gave it. But their predictions deserve to be thrown back at them; such as that democracy in Iraq would cause countries like Syria to fall like “ripe fruit from low hanging branches” into the democratic camp and that the “Arab street” would soon be singing “The Star Spangled Banner”. Neither has actually happened. Nor have umpteen “historic moments” in Iraq turned it into the freely forecast democratic land of milk and honey. Afghanistan is not going very well, either.

I have some knowledge of intellectuals because I am married to the genuine article. She sees things – concepts, ideas, policies etc – long before I do and can. But she remains rooted in the real world. And she is eternally ready to admit that she might have got something wrong. I do think authentic intellectuals have an important advisory role to play in government but, as a general rule, should not be allowed within a country mile of actual policymaking, especially in matters of war and peace....

Meanwhile, I think I will emulate Churchill in the only way I can – with a fat cigar and a large slug of brandy. Then I’ll read a James Lee Burke. They may not be intellectual but they can hurt only my lungs, liver and mind.

THE WAGES OF DESTRUCTION: The Making and Breaking of the Nazi Economy Adam Tooze. Allen Lane £30,

Adam Tooze appears to have written a real home run: / Arts & weekend / Books - The featherless eagle: By Bertrand Benoit: THE WAGES OF DESTRUCTION: The Making and Breaking of the Nazi Economy by Adam Tooze. Allen Lane £30, 832 pages:

Adam Tooze... The Wages of Destruction, a masterful economic history of the Third Reich. Tooze, an economic historian at Cambridge... painstakingly researched, astonishingly erudite study not only uncovers new explanatory strands for the events that led to and ended the war....

Based on solid statistical foundations, his central and perhaps most counter-intuitive finding is that the Germany that went to war in 1939, steeled by six years of hectic rearmament, was no mighty industrial steamroller but a weak economy, starved of resources and foreign exchange and crippled by an oversized and utterly unproductive agricultural sector. Despite rapid industrialisation in the late-19th century, standards of living in 1938 Germany were only half those in the US and two-thirds of the UK’s....Adolf Hitler’s country from the mid-1930s onwards was teetering on the brink of collapse. By 1940-41 it had reached crisis, failing to commandeer the steel and fuel to reverse the unfavourable and fast-degrading balance of power between its underfunded military and that of the Allied powers.

For most of the period covered, from Hitler’s rise to power in 1933 to the regime’s downfall in 1945, Germany’s economic policy boiled down to scarcity management. It was this, Tooze contends, that dictated the Blitzkrieg nature of the 1940 offensive against the west....

Once forced into a defensive position after the attack on Russia ground to a halt in the winter of 1941, the war was lost. If the economic managers of the Third Reich had any success at all, it was in ensuring that the conflict lasted four more years. This came at extraordinary human and moral costs. Occupied territories, mainly in the east, were ruthlessly looted for raw material, food and workforce.... Civilians and prisoners of war....

Tooze... does not dismiss politics as a factor in his narrative. The “ignorant condescension”, mainly racially motivated, shown by the Germans towards Soviet Russia was, he says, among the regime’s most determining miscalculations.... Tooze also refreshes our understanding of the Anglo-American bombing campaign of 1942-45. The raids on the Ruhr region, he argues, dealt a mortal blow to Germany’s military-industrial complex. But the RAF’s futile attempts at repeating in Berlin the firestorm it had sparked in Hamburg in July 1943, instead of tightening the hold on the coal-and-steel choke-point of the Ruhr, was “a tragic operational error.”...

One of Tooze’s most fascinating conclusions is how much Hitler’s economic understanding was informed by the US. Roosevelt’s America was not only the ultimate enemy, dominated as the Nazis thought by Jewish capitalism, but a role model.... [I]t was America’s vast territory and internal market that informed and, in his eyes, legitimised Hitler’s view that Germany could only prosper through the colonisation of the east. This Lebensraum theory, whereby local populations would be driven away or eradicated as the American Indians had been, was the Nazi answer to America’s frontier mentality. In fact, many aspects of Hitler’s economic thinking were nothing but a distorted interpretation of the US economic model...

I think Tooze is absolutely right in his assessment of Hitler's view of America.

Add this to the top of the pile immediately!

Hoisted from Comments: Tom Ricks Explains Why He Did Not Write the Stories He Thought He Should Be Writing

Howard asks, at

So I'm curious: how do Ricks and Kurtz account for the excellent work that Knight-Ridder did in the run-up to war?

The implicit answer is that wire service editors have other things to do than to rein in their reporters. Wire services have to trust their reporters, because there is never any time to second-guess them.

Hoisted from Comments: Tom Ricks Explains Why He Did Not Write the Stories He Thought He Should Be Writing

Drew writes, at

This drove me nuts back on '02.

I worked for a Congressman at the time who, along with quite a group of similar minded folk, would give regular coordinated floor speeches at appropriate times in the build up to war asking the hard questions (this wasn't the "why can't we all get along Kucinich caucus" -- these were the hard-headed opponents to the war who were working closely with Gen. Clark and other national security thinkers).

After the speeches, we would then send personalized emails and cold call national tv and newspaper reporters alerting them of the types of questions that were being raised and then subsequently following up by asking why they weren't reporting about about the strategy, intelligence etc. questions we were asking. Obviously, we were all ignored.

Literally, I remember calling a guy who had had reported on national network news the night before that "no one in Congress" had raised certain issues related to some aspect before the war. He admitted that members of Congress like Rangel, Inslee, Doggett and others were regularly asking these very questions -- the ones that supposedly weren't being asked -- and that they had done so the night before his report.

He did not offer to correct his inaccurate reporting and did nothing further to represent what was going on in the House.

I think that what Ricks means is not that nobody in Congress was asking questions and making points, but that nobody in Congress whom Ricks's editors regarded as A-list players was asking questions and making points. Who do Ricks's editors regard as A-list players? At times I think the list contains two: Joe Lieberman and Chuck Hagel.

Intimations of Recession

Paul Krugman takes the recession-worrier side of the argument:

Intimations of Recession - New York Times: By PAUL KRUGMAN: The key point is that the forces that caused a recession five years ago never went away. Business spending hasn't really recovered from the slump it went into after the technology bubble burst: nonresidential investment as a share of G.D.P., though up a bit from its low point, is still far below its levels in the late 1990s.... [T]he economy grew fairly fast over the last three years, mainly thanks to a gigantic housing boom... unprecedented spending on home construction... allowed consumers to convert rising home values into cash through mortgage refinancing, so that consumer spending could run far ahead of families' incomes....

Even optimists generally concede that the housing boom must eventually end, and that consumers will eventually have to start saving again. But the conventional wisdom was... that... business investment and exports would stand up as housing stood down. The latest numbers suggest, however, that this theory isn't working.... Signs of a deflating housing bubble began appearing a year ago... the latest G.D.P. data show real residential investment falling at an accelerating pace. The latest job numbers show falling employment in home construction, and retail employment has fallen over the past year, suggesting that consumer spending is running out of steam....

Meanwhile, neither business investment nor exports seem to be growing fast enough to make up for the housing slump.

Now maybe we'll still manage that soft landing despite a rapidly rising number of unsold houses.... But based on what we know now, there's an economic slowdown coming.... And what will policy makers do about a slump, if it happens? A snarky but accurate description of monetary policy over the past five years is that the Federal Reserve successfully replaced the technology bubble with a housing bubble. But where will the Fed find another bubble?

And with the budget still deep in deficit and the costs of the Iraq war still spiraling upward, it's hard to see Congress agreeing on any significant fiscal stimulus package.... One last thing: the real wages of most workers fell during the "Bush boom" of the last three years. If that boom, such as it was, is already over, workers have every right to ask, "Is that it?"

The Party of Ali Flexes Its Muscles...

Vali Nasr is talking sense. But couldn't Peter Waldman spare a paragraph to say that what Nasr says has happened--that the U.S. attack on Iraq has greatly strengthened Iran--was foreseen and feared by those Clintonites who pursued the policy of "dual containment" of Iraq and Iran in the 1990s? This isn't rocket science, after all: - Rising Academic Sees Sectarian Split Inflaming Mideast: By PETER WALDMAN: August 4, 2006; Page A1: WASHINGTON -- As Vali Nasr dashed for the airport last week after briefing a small group of academics and policy makers here, a hand pulled the political scientist aside. "That was the most coherent, in-depth and incisive discussion of the religious situation in the Middle East that I've heard in any setting," said Richard Land, a Southern Baptist leader and influential conservative. Sen. Joseph Biden, the ranking Democrat on the Senate Foreign Relations Committee, heaped similar praise on Mr. Nasr in May for giving what Mr. Biden called the most "concise and coherent" testimony on Iran he had ever heard.

From the violence in the Mideast, new realities are emerging -- and a new generation of experts to interpret them. Shiite Muslims are asserting themselves as never before. Followers of this branch of Islam, generally backbenchers in the region's power game, are central players in Lebanon, Iran and Iraq -- often acting out against traditional powers such as Israel, the U.S., and Sunni Arab states.

Mr. Nasr, a professor at the Naval Postgraduate School in Monterey, Calif., calls this a historic "Shiite revival" and has gone further than most in identifying it as a central force in Mideast politics. He also frames a possible U.S. response: Engage Iran, especially over the issue of reducing violence in Iraq, and try to manage Tehran's rise as a regional power rather than isolating it. The issues are more than academic for the 46-year-old professor. He was raised in Tehran and hails from a prominent intellectual and literary family in Iran that traces its lineage to the prophet Muhammad. His father was once president of Iran's top science university and chief of staff for the shah's wife.

In 1979, after the Iranian revolution, the Nasrs "started from zero" in the U.S., says Mr. Nasr. He received a doctorate in political science from the Massachusetts Institute of Technology, writing his thesis on the political dimensions of radical Islam, while his father, Seyyed Hossein Nasr, became a renowned professor of Islamic studies at George Washington University.

The younger Mr. Nasr has laid out his views in a series of speeches and articles.... Mr. Nasr's analysis begins with the idea that the removal of Saddam Hussein in Iraq has transformed the Mideast, but not in the ways promised by President Bush. By replacing Iraq's Sunni-led dictatorship with an elected government dominated by the country's Shiite majority, the U.S. destroyed the Sunni wall that had contained the restless Shiite power to the east, Iran. The clerical regime in Tehran was immeasurably strengthened.

This power shift, Mr. Nasr argues, has reopened an ancient fault line between Shiites and Sunnis that crosses the entire region. The schism dates back to the prophet Muhammad's death in 632, when his companions -- the forebears of the Sunnis -- chose Muhammad's close friend and father-in-law, Abu Bakr, to succeed him and become Islam's first caliph. Shiites believe Muhammad's son-in-law, Ali, was more deserving.

Ali managed to become Islam's fourth caliph, only to face multiple rebellions. He was ultimately murdered while at prayer at a shrine in what is now Iraq. His son, Hussein, refused to accept his father's Sunni usurpers and was slain 19 years later. Shiites commemorate Hussein's murder in the holiday called Ashura, a 10-day period of mourning and self-flagellation. Their reverence for Hussein's stand against tyranny is the touchstone of Shiite political passions -- often invoked during the Iranian revolution, the ensuing war against Saddam Hussein's Iraq, and even recently by the leader of the Lebanese Shiite group Hezbollah in its war against Israel. Traditional Sunnis view Shiites as heretics, led astray by Persian Zoroastrianism and other pagan beliefs....

"In the coming years, Shiites and Sunnis will compete over power, first in Iraq but ultimately across the entire region," Mr. Nasr writes in his new book, "The Shia Revival: How Conflicts Within Islam Will Shape the Future," published by W.W. Norton & Co. "The overall Sunni-Shiite conflict will play a large role in defining the Middle East as a whole and shaping its relations with the outside world."...

To adapt, the U.S. must "recalibrate" its diplomacy and re-establish contacts with Iran, he says. That would require disavowing any interest in "regime change" in Tehran -- an unrealistic aim anyway, Mr. Nasr argues -- but would offer the best hope of moderating Iran's growing influence. "The Iranian genie isn't going back in the bottle," he says. "If we deny these changes have happened -- that Cairo, Amman and Riyadh have lost control of the region -- and we continue to exclude Iran, we'd better be prepared to spend a lot of money on troops in the region for a long time," Mr. Nasr says....

"You can beat Hezbollah to a pulp, but you can't change the fact that around 45% of Lebanese are Shiites," Mr. Nasr says. Mr. Nasr also sees room for engagement with Tehran over Iraq.

Prior to the toppling of Saddam Hussein in 2003, the Bush administration argued change in Iraq would help spawn democracy in the region. At a seminar in Toronto around the start of the war, historian Bernard Lewis, who was instrumental in advising Vice President Dick Cheney and other top U.S. officials on the Iraq invasion, said: "The Iranian regime won't last very long after an overthrow of the regime in Iraq, and many other regimes in the region will feel threatened."

This prediction was based on a pivotal misunderstanding about Iraq's Shiites, Mr. Nasr says: that their Iraqi and Arab identity would supersede their Shiite affinity with Iran. As it turned out, as soon as Shiites took power in Iraq, they eagerly threw open the gates to Iranian influence and support.... "Ethnic antagonism [between Arabs and Persians] cannot possibly be all-important when Iraq's supreme religious leader is Iranian and Iran's chief justice is Iraqi," writes Mr. Nasr in the current edition of Foreign Affairs magazine. The references are to Grand Ayatollah Ali Sistani, the Iranian-born Iraqi religious leader, and the Iraqi-born head of Iran's judiciary, Ayatollah Mahmoud Shahroudi.

Mr. Lewis, in a phone interview, says he still believes the "tyrannies" neighboring Iraq feel threatened by the prospect of a stable democracy in Baghdad. He says Iran's activities in its neighbor are a sign of its fears.

Zalmay Khalilzad, the U.S. ambassador to Iraq, quipped about Iran's influence in a recent speech in Washington. When he met his Iranian counterpart in Afghanistan, Mr. Khalilzad said, "I used to joke with him that 'you guys ought to be much more helpful to us, because look, you couldn't deal with the Taliban problem, you couldn't deal with the Saddam problem, and we've dealt with both. That's a big deal. We'll send you a bill one day for that.'"...

But Mr. Nasr says U.S. and Iranian interests in Iraq may converge because both want lasting stability there. Comparing Iran to 19th-century Prussia and Japan of the 1930s, he says it is important to manage the rise of regional powers. "You can't regulate them by isolating them," he says.

Bernard Lewis, by contrast, is embarrassing himself. The parties of order and oligarchy all over the Middle East have been strengthened by the example of the clusterf--- that the Bush administration has watered and fertilized in Iraq. Everybody in the secular middle class in the Middle East now has a renewed appreciation for the virtues of their oligarchical rulers.

Tom Ricks Explains Why He Did Not Write the Stories He Thought He Should Be Writing

Tom Ricks talks about the runup to the war on Iraq. Ricks has said that there were major failures of five different institutions: the Administration, the CIA, the military, the media, and congress. We understand why Ricks assigns blame to the Administration--Bush, Cheney, Rumsfeld, Wolfowitz, and company. We understand why Ricks assigns blame to the CIA (although it did come under awful pressure from the Administration). We understand why Ricks assigns blame to the military. But congress? Congress did nothing. Why does Ricks assign blame to congress. That puzzled me.

Here he explains: He assigns blame to congress because without the aircover provided by senators asking touch questions at hearings, Tom Ricks found that his editors at the Washington Post would not let him write the stories he knew he should be writing to inform his readers of what was going on. Because congress did not do its job, Ricks thinks, he and his colleagues in the media could not do their job.

It's a very interesting point for Ricks to make.

Here's his conversation with Howard Kurtz: - Transcripts: KURTZ: Tom Ricks, your book, "Fiasco", has rocketed to No. 1 on the bestseller list. You argue that the administration is to blame, for not foreseeing many of the problems that are affecting Iraq today and 130,000 U.S. forces there?

RICKS: Well, not just the administration. Yes, the administration made huge mistakes, but the argument of the book is you don't get a mess as big of Iraq just through the mistakes of the Bush administration. That the U.S. military also bungled the occupation, and that other players also helped create this mess, including the media.

KURTZ: Including the media. In fact, you write, quote, in the run-up to the war, quote, "The media didn't delve deeply enough into the issues surrounding war, especially the threat of Iraq and the cost of occupying and remaking the country. We're seeing those costs right now." Why didn't the media delve more deeply? Was there a certain level of intimidation?

RICKS: I don't think it was so much as intimidation as partly a lack of information, credible information. Congress didn't hold hearings in which credible information was presented that said, no, the administration's case is wrong.

KURTZ: Since when do reporters have to wait for Congress to hold hearings?

RICKS: They don't. But Congress is kind of the engine of Washington, the engine of government. And if Congress is asleep at the wheel, if war seems inevitable, at some point your editors say, why do you keep writing about doubts about this war, when it's going to happen?

KURTZ: Do you include yourself in this indictment? Did you run into that kind of skepticism from your "Washington Post" editors?

RICKS: Absolutely. There was a sense that, look, this thing is going to happen. You've written a lot of stories about the doubts about the war. Give us more stories about the war plan, because it is going to happen, whether or not all these generals oppose it....

KURTZ: Welcome back. Tom Ricks, you are a beat reporter at the Pentagon for "The Washington Post". Now, you've written a book that concludes not only that the U.S. occupation there was a fiasco, but that the military made huge mistakes that contributed to the success of the insurgency. Doesn't that make it difficult to continue to cover the Pentagon as a objective observer?

RICKS: No, the striking thing to me has been the number of soldiers, in Iraq, who have sent me notes thanking me for writing this book. One battalion commander wrote to me, you finally said publicly what we've been saying privately for the last couple of years. The military wants to win in Iraq. And they appreciate somebody who comes along and sympathetically writes about the problems there, and also looks at some of the successes that have been neglected internally in the military.

KURTZ: And why were some of the mid-level people willing to talk to you, since obviously, to some degree they were contradicting their superior commanding officers?

RICKS: Because they've been worried about failures of leadership. It's an army that is very self-critical up to the level of colonel, but generals have remained off limits for criticism and that has led to real problems in Iraq. We've not had a single general relieved in Iraq -- a real change from other wars where generals routinely were moved out, while they were looking for good commanders.

Howard Kurtz, of course, should be fired immediately for his question: "[Y]ou've written a book that concludes... that the military made huge mistakes that contributed to the success of the insurgency. Doesn't that make it difficult to continue to cover the Pentagon as a objective observer?" Anybody who has not concluded that the military has made huge mistakes that contribued to the successof the insurgency is a shill who has no business claiming to be an objective observer.

And go buy Ricks's excellent Fiasco:

More Fed Watching and Advice to the Fed

William Polley is uncertain about what the Fed should do:

William J. Polley: August 2006 Archives: Try as I might to be single-handed, I can't say for sure what the Fed will do. I can come up with a lot of reasons to raise them one more time. I do worry a bit about the 6 to 18 month picture for inflation if they pause now. I'd like the increase to be now and the pause to be for the remainder of the year. But the markets have made up their mind, and Bernanke may not want to stir them up too much. They could very well send a strongly worded statement that though they pause now an increase in October is the default option unless new data changes that stance. If such a statement comes off as credible, it would be an acceptable compromise. We shall see.

And the mysterious, vowelless knzn says that the Fed would be sleeping more easily if it were targeting nominal unit labor costs:

Economics and...: What would happen if the Fed were targeting unit labor costs?: as it should. For one thing, people like me wouldn't be so panicked about stagflation right now.... [W]hen you look at unit labor costs, it's just another ordinary day. I reserve judgment, though, on whether we'll be panicked tomorrow morning, when the second quarter productivity report comes out.

Also, people like Brad DeLong wouldn't be so worried about import prices... [which] don't directly influence US labor costs.... Incidentally, the Fed might have started to tighten more quickly during the early part of 2005, after a couple of unpleasant unit labor cost numbers came out. In retrospect, that would have been a good time to tighten...

Watching the Fed

We monetary economist types are all rooting for Ben Bernanke and company, as they try to figure out what interest rate level is consistent with maximum purchasing power, employment, and growth and also with price stability. And so we are all giving him and his committee advice: contradictory advice:

Marty Feldstein says that uncertainty is enormous, and the task of attaining a "soft landing" very difficult, but that on balance his judgment is that the Federal Reserve should keep raising interest rates: - The Fed's Difficult Task: [T]he interest rate hikes of the past two years could soon cause a significant and sustained economic slowdown, bringing down future inflation without the need for further rate hikes. Although it is too soon to tell, some FOMC members may oppose a rise in the interest rate at tomorrow's meeting because of this possibility, and because of their fear that another rate increase could lead to an unnecessarily deep economic decline. The published forecasts of the FOMC members do not capture the full range of each individual's views. While stating that the most likely growth is 2.5%, an FOMC member may also believe that there is a risk that the growth and employment picture could be substantially worse.... As Alan Greenspan emphasized, monetary policy is a balancing of risks and cannot be made on the basis of the most likely projections alone.

The consequences of the past interest rate hikes are difficult to predict. The fall in the real level of house prices has caused residential construction to plummet, with housing starts off 14% from 12 months ago. The combination of lower housing wealth and a sharp fall in mortgage refinancing may cause the household saving rate to return to a positive level, bringing down consumer spending. Business expenditures on equipment and software slowed sharply in the most recent quarter. So a much sharper slowdown than the central tendency forecasts is certainly possible.

While this risk provides a rationale for a pause at tomorrow's meeting, it would be wrong to focus just on this downside risk. The probability that inflation will rise above the FOMC forecast is at least as great. The unemployment rate of 4.8% still represents a tight labor market. Waiting for more data before deciding to raise rates is not costless. If the Fed does not act and core inflation continues to rise, expected inflation may rise further. Higher expected inflation would cause faster increases in wages and prices. If the core PCE inflation rate rises above 3% in 2007, it would take a very substantial slowdown and a large loss of GDP and employment to bring it back under 2%.

In assessing the current interest rate decision, the FOMC members should recall that during the Volcker and Greenspan years the Fed pushed the fed funds rate to 8% above the concurrent rate of CPI inflation in the early 1980s, to 4% in 1989 and to almost 3% in 2000. That measure of the real fed funds rate is now less than 1%.

The Federal Reserve has a difficult task ahead. It is understandable that it would like to achieve the soft landing of low inflation with continued solid growth. But that may not be possible. And if the Fed wants to convince the markets that inflation will be contained in the future, it must show that it is willing to take the risk of tightening too much.

And John Berry writes for Bloomberg that last Friday's slightly depressing labor market report should have tipped the scales in the Federal Reserve's mind in favor of a pause--of not raising interest rates this week:

Aug. 7 (Bloomberg) -- The July labor market report tipped the scale in favor of a pause in the Federal Reserve's drive to raise interest rates to keep inflation under control. After 17 consecutive increases in the target for the overnight lending rate to 5.25 percent, officials should take a pass at tomorrow's Federal Open Market Committee meeting.

With the number of payroll jobs up only 113,000 and the unemployment rate rising to 4.8 percent from June's 4.6 percent, the Aug. 4 report provided further confirmation -- if any was really needed -- that U.S. economic growth has slowed significantly and may continue to do so.

Certainly the door is open for the FOMC to leave rates unchanged tomorrow. After digesting details of the labor report, investors put the probability of another rate increase at only 17 percent, down from 41 percent the day before, according to federal funds futures contracts on the Chicago Board of Trade.

That suggests there wouldn't be much of a backlash from analysts wringing their hands about Fed Chairman Ben S. Bernanke being ``soft on inflation'' or about the loss of Fed credibility as an inflation fighter. After all, a pause would be just that....

The issue, of course, is whether the 425 basis-point increase in the target since June 2004 will be enough to cap the recent acceleration in core inflation, which is now higher than the officials would like it to be. At least a few FOMC participants would prefer to see another quarter-point increase tomorrow, partly because they remain concerned there is so much liquidity available that monetary policy isn't biting.... [O]thers would prefer a pause, particularly given the lags with which changes in real interest rates affect the economy. A substantial portion of impact from those 425 basis points has yet to be felt, in their view.

In a speech on July 31, Janet L. Yellen, president of the San Francisco Fed, acknowledged those lags, which in both 1995 and 2000 caused the Fed to continue tightening too long....

Business investment in structures, equipment and software -- which many economists, including those at the Fed have been counting on to take up the slack as consumer outlays weakened -- increased at only a 2.7 percent rate in the quarter. All of the growth was in investment in structures while businesses trimmed equipment and software spending. Moreover, revisions to GDP for 2003, 2004 and 2005 showed that business investment was not as strong as earlier estimates indicated....

[E]ven with core inflation higher than Fed officials wish, a pause tomorrow in raising the overnight lending rate again makes sense. Overshooting didn't make sense at the end of the Fed's last two tightening cycles, and the FOMC ought to pause before doing it again.

And, of course, there is Brad DeLong in Salon

"The Odds of Economic Meltdown: With interest rates and oil prices rising and consumers spending beyond their means, we may be headed for recession -- and worse," Salon (August 3, 2006)

Brad DeLong

Aug. 3, 2006 | Forecasting recessions is a fool's game. If there is enough solid economic information to make it appear highly likely that a recession is coming -- that production, unemployment and consumer demand will actually fall -- then it is highly likely that there already is a recession. Businesses are not stupid, and they don't have to wait for economists to tell them what they already know. By the time a gloomy forecast has been issued they've probably already noticed a drop in consumer demand and responded by firing workers and reducing production.

So: Never say that a recession is coming. Say only that a recession is here, or that there might be a recession on the way. Which, in fact, is what I'm saying today. As of the beginning of August 2006, a recession is not here, and I'm not going to violate my own rule by saying one is coming. But there is a good chance -- for the first time since 2003 -- that there might be a recession in progress six months from now. Why? Three factors: 1) A Federal Reserve that finds itself with less inflation-fighting credibility than it thought it had; 2) upward pressure on inflation from rising energy and, perhaps, import prices; and 3) millions of middle-class homeowners who for too long have treated their houses as gigantic ATMs, using home equity loans and refinancing to generate extra spending money.

First, the Federal Reserve, now chaired by Bush appointee Ben Bernanke. The Federal Reserve sets interest rates, and when it does it tries to hit the economy's sweet spot: that point that produces maximum employment, purchasing power and growth without generating enough upward pressure on prices to produce expectations of inflation. The Federal Reserve does this by pushing interest rates up and down. Push interest rates up and businesses find it more expensive to expand capacity and production, causing them to cut back on investment spending. Push interest rates up and households' balance sheets deteriorate, causing them to cut back on consumption spending. Push interest rates down and firms find it cheaper to expand capacity and production, and so they ramp up investment spending. Push interest rates down and households find their balance sheets looking better and feel flush, expanding consumption spending.

There is one major complication: what Milton Friedman calls the "long and variable lags" in the system. Every action the Federal Reserve takes now affects production, demand and inflation roughly 15 months in the future. What the Federal Reserve has done in the past 15 months has not yet had a chance to affect the economy.

This leads to the Federal Reserve's current dilemma. The last two percentage points' worth of increases in interest rates -- increases in interest rates that will in the end make businesses cut back on investment spending and households feel pinched -- have not yet had a chance to affect the economy. Because of "long and variable lags," they are still "in the pipeline." When they emerge from the pipeline they will slow the economy further. By how much? Nobody is really sure.

In this situation it seems reasonable that the Federal Reserve should stop raising interest rates. Waiting to see what the interest-rate increases of the past couple of years will do to the economy would be a prudent strategy. Indeed, since last December the Federal Reserve has been quietly signaling that it is about to "pause," to adopt such a wait-and-see strategy. Yet so far it has not done so. Why not? One important reason is that the Federal Reserve is scared that if it pauses too soon it will convince many observers that it is not truly serious about fighting inflation -- and a central bank has a hard time fighting inflation if businesses, speculators and workers ever conclude that it is not truly serious.

The Federal Reserve is also unwilling to stop increasing interest rates because it is afraid of recession risk factor No. 2: a rise in oil and import prices. Those fears are justified. Remember how the invasion of Iraq, besides bringing a golden age of democracy to the Middle East, was also supposed to produce $15-dollar-per-barrel oil? Oil is now at $75 a barrel, and this rise in oil prices is putting upward pressure on prices in general. As for import prices, they are vulnerable to a U.S. dollar that has been weakened by the Bush budget deficit and massive borrowing from China. Suppose the dollar declines suddenly, which is not a far-fetched possibility. Should the dollar fall by, say, 30 percent, and should importers raise their dollar prices in proportion, then the one-sixth of U.S. spending that is spending on imports will see prices rise by 30 percent. Because 30 percent times one-sixth equals 5 percent, that would boost U.S. consumer prices by 5 percent nearly overnight.

Thus there are two big reasons for the Federal Reserve to keep raising interest rates, in spite of how much downward pressure on demand is still in the pipeline. The Federal Reserve thinks it needs to do so in order to establish its long-term credibility, and there are the twin dangers of oil- and import price-triggered inflation to guard against.

Most likely the Federal Reserve's continued raises in interest rates will not send the economy into recession. But there is that chance, and the chance is raised from a low-probability possibility to a serious worry by the third factor: that home-as-ATM problem. The unprecedented use of home loans to squeeze cash out of equity has allowed middle-class consumers to spend well beyond their means. Someday this spending spree has to come to an end. If it comes to an end suddenly, at a time when the Federal Reserve has raised interest rates a little too much, then we have our recession.

Make no mistake about it: The U.S. economy is close to the edge. Retail sales in the second quarter were rising at only a 2.1 percent annual pace. Business investment in equipment and software was falling. Residential construction was falling. Either households will continue spending beyond all reason, or businesses will start boosting investment, or exports will start booming, or there will be a recession sometime in the next year. Figure the odds at 3 out of 10.

What can be done to head off the danger? Unfortunately, very little. The bag of macroeconomic tricks is empty. In 2000-2001 the Federal Reserve could lower interest rates to the floor, boosting residential construction and consumer spending to offset the decline in high-tech investment, and turn the 2001 recession into a very small event indeed. In 2002-2003 the short-run stimulative effect of the Bush tax cuts came online at exactly the right moment to offset fears of a deflationary spiral. But today further fiscal stimulus would increase global imbalances -- meaning, raise the trade deficit -- and do more damage to confidence than it might do good in curing a recession. And sharp reductions in interest rates would lower the value of the dollar and increase inflationary pressures from import prices in a way that the Federal Reserve does not dare allow.

The past 24 years have been an amazing run as far as the business cycle is concerned. There have been only two recessions, and both of those were short and shallow. But Ben Bernanke and Co. are now at real risk of presiding over the third.


* salon,
* dollar,
* international finance,
* federal reserve,
* bernanke,
* macroeconomics,
* interest rates,
* delong cv,
* monetary policy,
* recession

An Explanation of Joe Lieberman's Zigs and Zags

McJoan at the Daily Kos on Joe Lieberman:

Daily Kos: CT-Sen: The Lieberman Principle: Here's what the "steadfast" Joe Lieberman said about criticism of President Bush, Bush's Iraq plan, and Rummy from 2003 to 2006. I highlighted the statements Lieberman made when running in contested elections and thus needed Democratic votes and support in italic...

Joe Lieberman today on dissent:

What I will say is this: I not only respect your right to disagree or question the President, I value it. I was part of the anti-war movement in the late 1960s, so I don't need to be lectured by Ned Lamont about the place of dissent in our democracy.

Joe Lieberman in December 2005 on dissent.

It's time for Democrats who distrust President Bush to acknowledge that he will be the commander in chief for three more critical years and that in matters of war we undermine presidential credibility at our nation's peril.

Joe Lieberman today on the Bush Administration plans for the Iraq occupation:

The fact is, I have openly and clearly disagreed with and criticized the President for, among other things . . . not having a plan to win the peace[.] [NOTE: Lieberman made these criticisms in 2003, when he was seeking the Democratic nomination for the Presidency.]

Joe Lieberman in December 2005 on the Bush Plan for Iraq:

Does America have a good plan for doing this, a strategy for victory in Iraq? Yes, we do. And it's important to make clear to the American people that the plan has not remained stubbornly still, but has changed over the years.

Joe Lieberman today on Rummy:

I said that if I were President, I would ask Secretary Rumsfeld to resign. I first [NOTE: Lieberman never said it again until his appearance on the Ed Schultz show this week] said that in October 2003. [NOTE: In October 2003, when Lieberman called for Rumsfeld's resignation, he was seeking the Democratic nomination for the Presidency.]

Joe Lieberman in May 2004 on Rummy:

[I]t is neither sensible nor fair to force the resignation of the secretary of defense, who clearly retains the confidence of the commander in chief, in the midst of a war. . . . Secretary Rumsfeld's removal would delight foreign and domestic opponents of America's presence in Iraq.

Have we found a pattern? All the... statements, when Lieberman supports President Bush, come when he is not running in contested elections and does not need Democratic support. All the italicized statements, when Lieberman is critical of President Bush, come when he is running in contested elections and does need Democratic support....

So this is the Lieberman Principle. What is good for Joe is good. When it is good for Joe to criticize the President, then it is good to criticize the President. Only then. When it is good for Joe to be partisan, then it is good to be partisan. Only then. When it is good for Joe to abandon the Democratic party, then it is good. Only then...

Jim McDonald's How Mother Nature Will Try to Kill You: Hyperthermia

That's "too much heat":

Making Light: Heat Stress: Jim Macdonald: Welcome back to Environmental Emergencies Theatre. In our last thrilling episode we saw Hypothermia. It's summertime now, so it's time to talk about Heat Stress, aka Hyperthermia. Hyperthermia, like her twin sister Hypo, can kill you deader'n dirt by this time tomorrow.

We do best when our core temperature is within one degree either way of 98.6 degrees Fahrenheit (37 degrees Celsius). Below that, you're into hypothermia. Above it, you have hyperthermia.

We generate heat all the time.... The name for keeping the interior environment of our body within certain narrow limits (pH, salinity, and so on) is homeostasis. The human body has several systems that are tasked with maintaining our internal temperature. It's a mammal thing. We regulate our internal temperature by internal means so we don't have to crawl into cracks or sun ourselves on rocks.

Regardless of the exact origin of the heat in the body, it has to go somewhere, because the body is very heat-sensitive. Even when it's forty below and we're wearing our parkas, we still need to bleed off excess heat. All we're doing is controlling the rate. If the core body temperature hits around 105 degrees Farenheit, the proteins in the brain start to denature, and within ten to fifteen minutes... you're in deep, deep trouble...

Pleasant planet you're guiding us around, Mr. MacDonald.

Paging John Searle, John Searle Please Come to the White Courtesy Phone

Mark Thoma of and the University of Oregon wrote to thank me for writing:

Brad DeLong's Semi-Daily Journal: July 2006: My current top 20 weblogs by attention, according to NetNewsWire:

  1. Political Animal:
  2. Talking Points Memo:
  3. Brad DeLong's Semi-Daily Journal:
  4. Economist's View:
  5. Crooked Timber:

My first reaction was one of embarrassment. I had not willed that I do something nice for him--certainly nothing that deserved thanks, or gratitude. All I had willed was that I sort the items in my NetNewsWire RSS lead by attention, and then pluck off the first few items that rated highest by attention.

I, Brad DeLong, had done nothing to deserve thanks, or gratitude.

But then I thought: There is an entity--call it the Upstairs Study Room. It consists of Brad DeLong, a mouse, a keyboard, a screen, a box that holds the computer, a computer running Safari and NetNewsWire, a wire, a cable modem, and a cable leading out of the house. That anthology entity certainly "knew" that was #4 RSS feed by attention, and that anthology entity "wanted" to communicate that to the world, and did so.

So if that anthology entity is a separate moral agent of which I am just one component, it gladly accepts Mark Thoma's thanks and gratitude.

Me... I'm not sure that I can :-). But then who am I?

Charlie Stross Recommends...

I'm going to take his pessimistic downer rant and excerpt parts that make it an upbeat recommended reading list:

Charlie's Diary: Genre neuroses 101: [O]ne of the reasons I'm so pleased with Liz Williams' recent foray into the supernatural detective field is that her two novels, [The Snake Agent]d( and The Demon in the City, have nothing whatsoever to do with warmed-over Christian theology. They're straight Confucianism all the way, and when one of her demonic protagonists discovers that he has a conscience this is cause for regret rather than redemption. The result is oddly like Chow Yun Fat trying to make a supernatural kung fu action movie version of Miss Smila's Feel for Snow....

Vernor Vinge is swimming strongly against the flow in Rainbows End, where he envisages a future just a couple of decades hence where the machines dance. Peter Watts is doing stuff with the genre that just shouldn't be possible (evolutionary biology, exobiology, and vampires in spaaaaaace -- all done with a deft touch of plausibility and a refreshingly pleasant dose of bleakly nihilistic existential despair)....

Finally, there is the blasted heath that is fantasy.... There's some really interesting stuff going on there (paging Paul Park, Paul Park to the white courtesy phone -- or Steven Brust, at a pinch)...

Hiroshima Day

Be silent a minute or two for Hiroshima Day.

I am somebody who believes that the murder of 200,000 Japanese civilians at Hiroshima and Nagasaki in the fall of 1945 had good utilitarian consequences in that it brought the end of World War II in the Pacific and so saved millions of lives. But I am well aware that that is a dicey and insecure judgment.

If I ever get the power to arrange it, I will have the U.N. Security Council and U.N. General Assembly meet in Hiroshima each August 6, every year, at Ground Zero, to concentrate their minds.

What Did the Olmert Government Think It Was Doing?

Michael Yglesias writes:

How Bad Was It? | TPMCafe: By Matthew Yglesias: Via Hilzoy, a very interesting resource from the Israeli Ministry of Foreign Affairs, namely a list of Hezbollah attacks along Israel's northern border from May 2000 to June 2006. I tried to tally it all up, and I came up with 13 soldiers and seven civilians killed, along with 27 soldiers and 7 civilians wounded, plus three IDF soldiers and two Israeli Arabs captured....

[T]his is what happened after Israel stopped occupying Lebanese land, it's all very unjustified. Clearly, given the consistent nature of these provocations, Israel had a legal and moral right to seek changes.

At the same time, the list puts some perspective on the practical size of the Hezbollah problem. Twenty dead over six years. Thirty-four wounded. A bad business. But clearly a low-intensity problem all things considered. Hezbollah, whatever its notional commitment to the destruction of Israel, was not a practical threat to the nation's survival....

The tit-for-tat retaliations appear to have succeeded in containing the conflict. Not in stopping Hezbollah from attacking, but in dissuading it from escalating. The resulting situation wasn't ideal by any means, but it was pretty good, all things considered. The odds that the current military action -- which has already cost Israel, to say nothing of Lebanon, more lives than six years worth of low-intensity conflict -- will alter the situation dramatically for the better strike me as very low.

A Funeral for Private Defined-Benefit Pensions

David Wessel on the regulation of pensions: - Capital: The Big Pension Bill: Is That All There Is? August 3, 2006; Page A2: The 907-page bill addresses a big problem: Employers have made pension promises to 44 million workers and retirees, but many haven't set aside enough money to cover them. At last tally, they were roughly $300 billion short.

If those pension funds or the sponsoring employers go bust, the government Pension Benefit Guaranty Corp. will pay retirees -- albeit often less than those workers had been promised. Its assets are about $23 billion short of the pensions it has promised to pay, and it's likely to get stuck with more pension plans in the next several years. So far, the PBGC has been able to get by with assets it inherits from failed plans and insurance premiums paid by operating pension plans. But if it ever runs out of money, taxpayers almost surely will get the bill.

Sound public policy would discourage, if not forbid, employers and unions from promising pensions to workers unless they set aside enough to pay them. That would protect workers as well as taxpayers, many of whom don't have any employer-sponsored retirement plans at all. (About 45% of all full-time private-sector workers aren't offered a retirement plan at work.)

But if congress makes offering defined-benefit pension plans too onerous, companies will abandon them. Many have already. Only one in five private-sector workers is covered by a defined-benefit pension, the sort that pays a set sum each month. That fraction is shrinking. About four in 10 have a 401(k) or other defined-contribution plan, where the worker owns the assets but takes the risk of sour markets or outliving one's saving. (Some workers have both kinds.)

So does this bill get the balance right? It's tough to get a smart answer -- partly because the bill is so sprawling, partly because the cognoscenti focus not on the all, but on the provisions they like or dislike.... Perhaps the pension bill is best viewed as a funeral service for defined-benefit pensions. Employers don't want to be in this business, preferring to pass the risk of financial markets and longevity to workers, many of whom would rather have a 401(k) anyhow. Private-sector defined-benefit plans had $1.9 trillion in assets at year-end 2005, while 401(k)-style plans had $2.9 trillion and individual retirement accounts had $3.7 trillion

In that light, the most important provisions may be rules set for defined-contribution plans. The bill would encourage employers to automatically enroll workers in such plans: you fill out a form to opt out, instead of filling out a form to sign up. That's wise in a nation where too many people save too little. And it would raise the ceiling on tax-favored contributions to such plans, a break that helps only the best-off Americans....

The quiet word from sober pension experts is that the bill does more good than ill for most workers and taxpayers, but is disappointing, given how much time Congress spent on it.

And, as House Majority Leader John Boehner said the other day, "This bill's going to be in effect for the next 20 to 25 years." Translation: If you think we're going near this issue again soon, you're crazy.

Not Joe Lieberman's Nadir

Michael Schiavo talks about one of Joe Lieberman's political-positioning exercises:

Daily Kos: Excuse me, Mr. Lieberman?: by Michael Schiavo. Sun Jul 30, 2006 at 07:04:25 PM PDT: [A] few people stood out. Tom Delay, of course. Rick Santorum and Bill Frist. President Bush.

And Joe Lieberman.

Not only did Joe Lieberman support the illegal political intervention in the private and legally protected decisions of my family, he went out of his way to defend it. On national television.

So when I thought about going to Connecticut to remind voters what Joe Lieberman really thinks about family values and personal privacy, I didn't have to think too long.... But it was Joe Lieberman's comment while I was in Connecticut with Ned Lamont that should show everyone Joe Lieberman still doesn't get it. According to press reports, Lieberman said, "It's time for politicians to let Terri Schiavo rest in peace."


Mr. Lieberman, where was your sense of compassion for Terri last year when you went on "Meet the Press" to say politicians should get involved?

Mr. Lieberman, you, Tom Delay, Bill Frist, Marilyn Musgrave and other right-wing politicians thought Terri was a prime political issue then.

Mr. Lieberman, I must have missed your passionate speech on the Senate floor about how this issue, this case, my family was not a cause for politicians. I missed it, Senator, because you never gave such a speech.

When it came time to count hands and be heard, Mr. Lieberman, you threw in with Bill Frist and George Bush.

And now that you're in a fight for your political future and down in the polls you want politicians to "let Terri rest in peace."

I'll bet you do, Mr. Lieberman.

I bet you want nothing more than for voters in Connecticut to forget what you did and what you said...

Stay in Town

Prometheus 6:

The first step of a 1000 mile journey | Prometheus 6: Bluffton, he says, was no doubt a sundown town. So are 65% of all incorporated municipalities in neighboring Illinois, according to his research...

Small Indiana town singing tune of racial, ethnic harmony Updated 8/4/2006 2:10 AM ET By Haya El Nasser, USA TODAY: Local folklore has it that the small town of Bluffton, Ind., once had an ordinance to keep blacks out, Mayor Ted Ellis says. He never found proof but says he wondered why Bluffton remained 96% white while many other cities became more diverse. "I always thought that Bluffton was no more hostile than other communities around," Ellis says. [P6: You were right.]

Then came an anonymous letter about 18 months ago. It was a photocopy of a newspaper clipping about the opening of a restaurant in this town of 10,000 people about 25 minutes south of Fort Wayne. A hand-printed message above the photo of the restaurant owner, a college professor who is a Sikh, read, "We don't wear turbans in Bluffton... we speak English." Ellis was appalled. "I just felt I had been hit in the gut when I got that," he says. He invited the businessman to his state of the city address, seated him at his table and got his first standing ovation in 10 years as mayor. "The leadership of the community has its heart in the right place," he says. "But it certainly illustrated that no matter how nice we are to one another, there still is an underlying current."

Encouraging dialogue That's why Bluffton was among the first to join the National League of Cities' Partnership for Working Toward Inclusive Communities. The initiative encourages cities to start a dialogue about diversity and acceptance and to put up signs promoting their efforts: "Welcome. We are building an inclusive community." Sixty-eight cities have joined. "Inclusiveness means different things to different people," Ellis says. "In Selma (Ala.) and Little Rock, it's a long history of racial tension. But if you live long enough, everyone has been excluded at some time." Sociologist James Loewen wrote Sundown Towns, a history of thousands of towns and cities that excluded African-Americans and other minorities after sundown. Although racial exclusion is most often associated with the South, Loewen found that the sundown town was a Northern invention. In his book, eyewitnesses tell of sundown signs in more than 150 communities in 31 states. One sign bluntly stated, "Whites only within city limits after dark." Others in Arkansas, Kentucky, Missouri and Tennessee depicted a black mule and used profane language to warn African-Americans to get out of town by sundown.

"Most all-white communities in the United States are all-white on purpose," says Loewen, a visiting professor at Catholic University of America in Washington, D.C. "For decades, formally and informally, they kept out people of color, particularly African-Americans," he says. Bluffton, he says, was no doubt a sundown town. So are 65% of all incorporated municipalities in neighboring Illinois, according to his research. That's why Bluffton's decision to put up signs stating that it's building an inclusive community is full of symbolism. The city plans to put up signs at the three state highway entrances to the city and two at each of the town's eight schools, Ellis says. "It's very important," Loewen says. "Every sundown town and every sundown city in America should take steps."


Miserable Donuts is awed by the existence of ripe grapes in the supermarket:

Miserable Donuts: A Philosophical-Logistical Rant: You are an average person in an average area of America, say, Northern Illinois. You find that you want some grapes. What do you do? You go down to the store and get some, right? Nothing complicated, nothing special, nothing remarkable - or is it?

The grape has been around a long time and, naturally, wine making was the primary use of grapes. For millennia, if you wanted to eat a grape; you had to pick one right at harvest (and not be executed for stealing from a monastery or some aristocrat's vineyards, heh heh). At certain times, the elite could get hothouse grapes, perhaps in limited quantities and at limited times.

Now? You can just go to the nearest grocery store and pick up something that the Holy Roman Emperor himself could not have had grace his table, for most of the year, during anytime in the Middle Ages.

And you can do it darn near any day of the year. For very little money. So what you say? Have you considered what it takes to get that grape to you? Where it comes from? Oh, and I simply use the grape as an example... this is even more spectacular when you consider something exotic like a pineapple or banana.Grapes can come from very far away foreign places that are hard to fathom... like California (OK, I kid!). Seriously, the grape example is best considered using the nation of Chile.

That grape you are going to munch on as a snack, or that is going to garnish something at a restaurant, had a heck of a journey - and it took some fairly sophisticated technology to get it here. Journeys that once made the "names" at Lloyd's sweat blood, are handled by ships that are beyond anything that could have been imagined back in the 17th and 18th Century.

Sophisticated logistical hubs and procedures are in place to make the receiving of this cargo barely warrant a yawn. Where Shakespeare portrayed the vast rise or fall in fortune that a single ship "coming in" can bring, - the ships bringing in produce today don't warrant even a single line in your local paper. Of course, to be sure that some people are watching and they are interested.I lived among grape growers in a poor part of the world....

Their crop was quickly consumed or turned into raisins (note I have failed to mention the very small and discrete brandy making that may or may not still go on there). "Sorry, no grapes today... or tomorrow".

When the grapes are gone, it's wait until next year. Not so here in Average America.

So what prompted this paean to grapes/rant about commerce? I caught myself at the store this past weekend thinking the selections had been a bit picked over... then it hit me that my complaint was a haughty and shabby thing. Especially when you look at what a near miracle it is to even have something like a table grape available.

We live in great days - and this is one little example of what and how they are brought about.

Why the U.S. Is Not Winning the War on Terror

Tom Ricks wrote that he saw extraordinary failures at five levels: Bush and company, intelligence, military, congress, and press. Ricks's Fiasco covers the military angle. More people should read Ron Suskind's The One Percent Doctrine, which covers the intelligence angle.

Here we have a short passage quoted by Educated Guesswork:

Educated Guesswork: Running out of maneuvering room: From The One Percent Doctrine:

KSM's two children, a seven-year-old boy and a nine-year-old girl, were also in US custody, picked up when the Karachi safe house had been raided the previous September. From Langley, a message was passed to the interrogators at a secret detention center in Thailand, where KSM was being held: do whatever's necessary.

According to several former CIA officials interrogators told KSM his children would be hurt if he didn't cooperate. The response, said, one CIA manager with knowledge of the incident: "He basically said, so, fine, they'll join Allah in a better place."

The traditional models of debriefing, used by both FBI and CIA, involved the building of a relationship, no matter how long and arduous a process. It's the need for some human contact, some basic comfort, rather than simply the bottomless human fear, which ultimately triumphs. The captive's previous life starts to fade and is slowly replaced by one constructed, often ingeniously, by his captors. This method the FBI still recommends.

That's the gamble. Once you do something as horrific as threaten someone's children, and it doesn't work--there's nowhere else to go.

Still needed are good books covering the congressional angle--why have the committee chairs of the Senate been so weak?--the press angle--why haven't they resigned, donated all their goods to the poor, and taken up a life of anonymous service to others?--and the riddle wrapped inside a mystery inside an engima of colossal stupidity that is Bush and his administration.

Mankiw and Swagel Reflect on the Politics and Economics of Offshore Outsourcing

Well worth reading. Greg Mankiw and Phil Swagel reflect on their unfair trashing by the Washington media machine in February 2004:

The Politics and Economics of Offshore Outsourcing. N. Gregory Mankiw, Phillip Swagel. NBER Working Paper No. 12398. Issued in July 2006. NBER Program(s): EFG ITI POL

Abstract: This paper reviews the political uproar over offshore outsourcing connected with the release of the Economic Report of the President (ERP) in February 2004, examines the differing ways in which economists and non-economists talk about offshore outsourcing, and assesses the empirical evidence on the importance of offshore outsourcing in accounting for the weak labor market from 2001 to 2004. Even with important gaps in the data, the empirical literature is able to conclude that offshore outsourcing is unlikely to have accounted for a meaningful part of the job losses in the recent downturn or contributed much to the slow labor market rebound. The empirical evidence to date, while still tentative, actually suggests that increased employment in the overseas affiliates of U.S. multinationals is associated with more employment in the U.S. parent rather than less.

Mankiw and Swagel write:

Outsourcing was the topic of two questions at the press conference. It is useful to reproduce the complete answers to these questions to illustrate just how far out of context the subsequent public discussion was to take the comments made at the press conference. The response to the first question on outsourcing was:

I think outsourcing is a growing phenomenon, but it's something that we should realize is probably a plus for the economy in the long run. Economists have talked for years about trade, free international trade, being a positive for economies around the world, both at home and abroad. This is something that is universally believed by economists. The President believes this. He talks about opening up markets abroad for American products being one of his most important economic priorities. And we saw discussions this weekend of the Australia agreement. So it's a very important priority.

When we talk about outsourcing, outsourcing is just a new way of doing international trade. We're very used to goods being produced abroad and being shipped here on ships or planes. What we're not used to is services being produced abroad and being sent here over the Internet or telephone wires.

But does it matter from an economic standpoint whether values of items produced abroad come on planes and ships or over fiber optic cables? Well, no, the economics is basically the same. More things are tradable than were tradable in the past, and that's a good thing. That doesn't mean there's not dislocations; trade always means there's dislocations. And we need to help workers find jobs and make sure to create jobs here. But we shouldn't retreat from the basic principles of free trade. Outsourcing is the latest manifestation of the gains from trade that economists have talked about at least since Adam Smith.

Notice that the order of response was to first note the gains from trade, and only second to refer to the dislocation to affected workers; later we will discuss how, from a communications standpoint, this was a tactical error....

It was not at all clear following the press conference that a political firestorm was in the making. Indeed, reporters from the Financial Times, USA Today, and the Wall Street Journal complained at the end of the press conference that there had not been any news. A reporter from the Washington Post suggested after the event that the answer on outsourcing might be controversial, but more because of the inherently contentious nature of the topic.... [T]he reporters who missed the story at first were among the best in the Washington press corps in terms of their economic knowledge. The FT and Wall Street Journal reporters had the backgrounds one would expect of economics writers for those publications, while the reporter for USA Today was a 1995 graduate of Harvard who had majored in economics and written on the subject for the FT before moving to the mass-circulation USA Today. For these reporters (as for ourselves), a focus on the economic substance meant overlooking the newsworthy point that a White House adviser was talking straightforwardly about the subject of outsourcing in the first place during an election year....

The controversy arose instead from coverage of the press conference in the Los Angeles Times. Above a nuanced discussion of the costs and benefits of outsourcing, the LA Times ran the incendiary (and inaccurate) headline “Bush Supports Shift of Jobs Overseas.” In contrast, the Post headline above a similar story was “Bush Report Offers Positive Outlook on Jobs.”

It took less than a day for the words “Bush Supports Shift of Jobs Overseas” to be picked up by opponents of the President. However, it took more than half a day for this to happen, so that the issue of outsourcing figured little at the Congressional hearing on the ERP on February 10—-the day of the inflammatory LA Times headline.... This changed within the same day’s news cycle.... The next day, February 11, a story on the ERP in the Washington Post was headlined “Bush, Adviser Assailed for Stance on 'Offshoring' Jobs”... and quoted Senator Kerry decrying the White House desire to “export more of our jobs overseas,” as well as Republican Congressman Donald Manzullo from Illinois calling for the resignation of the CEA chairman. White House aides responsible for Congressional liaison warned of fury on the part of Republican members of Congress from Pennsylvania, Ohio, Michigan, and other industrial states....

An interesting note is that after the first day’s stories on the ERP and the press conference, subsequent press coverage focused largely on the political response rather than the substance of what was actually written and said. Indeed, reporters writing the stories universally acknowledged in private that the CEA Report was both correct and unremarkable on the substance. What was remarkable was the reaction, and as journalists they were obligated to cover the political reaction and fallout. The coverage reflected the unfortunate reality of the modern craft of journalism. In general, the coverage did not seem to us to reflect malice, bias, or sloppiness on the part of the journalists involved.... Matters of substance were left to editorial writers...

Well, it depends on what the meaning of "bias" and "malice" are.

Journalists may have been "obligated to cover the political reaction and fallout," but they were also obligated--an obligation they failed to perform--to inform their readers. If it was indeed the case, as Mankiw and Swagel say (and I believe them) that the "reporters writing the stories universally acknowledged in private that the CEA Report was both correct and unremarkable on the substance," then the reporters had an obligation to inform their readers of that fact--a obligation they did not meet, yet easily could have met. Had they met the obligation, they would have better informed their readers. They would also have annoyed a few members of congress by making them look ill-informed.

A reporter who successfully covered both the political reaction and the economics was the excellent Bob Davis of the Wall Street Journal, who wrote on February 12, 2004:

"Some Democratic Economists Echo Mankiw on Outsourcing," By BOB DAVIS February 12, 2004: WASHINGTON -- White House chief economist Gregory Mankiw set off a political firestorm this week when he said that outsourcing U.S. jobs helps the economy. But some prominent Democratic economists make the same argument.

At a Monday news conference, Mr. Mankiw said that sending U.S. service jobs abroad "is probably a plus for the economy in the long run." That is because foreign workers can do the jobs more cheaply, reducing costs for U.S. consumers and companies. "Outsourcing is just a new way of doing international trade," he added.

Since then, his remarks have brought sharp rebukes from lawmakers, including some Republicans. "Incredible indifference," said Democratic presidential contender Sen. John Edwards of North Carolina. "What planet do they live on?" Even Republican House Speaker Dennis Hastert of Illinois said Mr. Mankiw's "theory fails a basic test of real economics."

The White House has offered Mr. Mankiw only tepid support. Calls for his resignation were "kind of laughable," said White House spokesman Scott McClellan, because the economic team is "doing a great job."

Even among Democratic economists, though, Mr. Mankiw's remarks were mainstream. "Basically I agree with Greg's thrust," said Janet Yellen, who was President Clinton's chief economist. "In the long run, outsourcing is another form of trade that benefits the U.S. economy by giving us cheaper ways to do things."

But Ms. Yellen added that many moderately paid U.S. workers are suffering because of outsourcing, especially call-center workers whose jobs have been shipped to India and elsewhere.

The controversy surrounding Mr. Mankiw's remarks spotlights the political potency of the jobs issue this year. Since Mr. Bush has taken office, the U.S. has lost more than two million jobs -- a statistic that has become a major point of attack for Democrats who cite outsourcing as one cause. In recent months, the economy has sharply rebounded, but job growth remains weak .

Mr. Mankiw, who is chairman of the White House's council of economic advisers, may have been trying to put the outsourcing issue in perspective, and speaking more as an economist than a politician. But to some critics he sounded cavalier -- for instance, in suggesting that high-paying jobs in radiology might be better done abroad than in the U.S.

Said Laura Tyson, dean of the London Business School and another of Mr. Clinton's former chief economists: "The traditional economic response does sound hard-hearted and can be criticized for not taking nearly as seriously the dislocation as one should."

A chastened Mr. Mankiw said Wednesday, "I wish I had been more clear at the press conference; any loss of jobs is regrettable. If I suggested otherwise, I failed to communicate."

Though Mr. Mankiw also trumpeted the administration's job-retraining initiatives, the message was obscured by his outsourcing remarks.

"On efficiency grounds, he [Mr. Mankiw] is right," said former Clinton Labor Secretary Robert Reich, meaning that the economy becomes more efficient when costs are reduced through trade. But Mr. Reich, who advises Democratic presidential front-runner Sen. John Kerry, said the administration hadn't made "a serious attempt to deal with the profound structural problems of an economy in transition as it affects middle-class jobs."

Monday, Mr. Kerry joined in the Mankiw bashing, saying the administration wants "to export more of our jobs overseas." But Brad DeLong, a former Clinton treasury economist, cautioned that Mr. Kerry ought to be careful with his word because the outsourcing trend is bound to continue. "Linking outsourcing to aggregate employment decline is a bit of demagoguery that will bite him in the butt next February if he becomes president," Mr. DeLong said.

Why Oh Why Can't We Have a Better Press Corps? (Robert Kagan/Joe Lieberman Edition)

The Washington Post continues to give air to the vastly overrated Robert Kagan, who calls Joe Lieberman "the last honest man":

The Last Honest Man: If Lieberman loses, it will not even be because he supported the war.... Lieberman stands condemned today because he didn't recant. He didn't say he was wrong. He didn't turn on his former allies and condemn them. He didn't claim to be the victim of a hoax. He didn't try to pretend that he never supported the war in the first place. He didn't claim to be led into support for the war by a group of writers and intellectuals whom he can now denounce. He didn't go through a public show of agonizing and phony soul-baring and apologizing in the hopes of resuscitating his reputation, as have some noted "public intellectuals."

These have been the chosen tactics of self-preservation ever since events in Iraq started to go badly and the war became unpopular. Prominent intellectuals, both liberal and conservative, have turned on their friends and allies in an effort to avoid opprobrium for a war they publicly supported. Journalists have turned on their fellow journalists in an effort to make them scapegoats for the whole profession. Politicians have twisted themselves into pretzels to explain away their support for the war or, better still, to blame someone else for persuading them to support it...

Guess Kagan didn't get the memo.

Joe Lieberman is no longer the old Joe Lieberman who attacked Jack Murtha, saying: "We undermine the President's credibility at our nation's peril."

Today we have a new Joe Lieberman, who has no problems undermining George W. Bush's credibility: "I supported our war in Iraq but I have always questioned the way it was being executed. This administration took far too many shortcuts. We continue to suffer the consequences, as do the Iraqi people."

As the LA Times Waters the Astroturf...

Ellen Barry of the Los Angeles Times writes:

Lieberman's Rival Lamont Widens Lead in Latest Poll - Los Angeles Times: Lamont also met Richard Goodstein, a friend and supporter of Lieberman's who had waited in the diner for the chance to confront him. As Lamont greeted supporters, Goodstein loudly accused him of unfairly smearing Lieberman.

"I take this all very personally -- A, because of my affection for Lieberman; and B, because of my commitment to the prospects of Democrats nationally," said Goodstein, 57, a lawyer.

"I think Ned Lamont has the potential to do grievous harm to the Democrats."

She does not tell us that Richard Goostein is a Washington-based lobbyist for DCI...


I had always thought that the benefit-cost ratio from flame-retardant pajamas was high. The fact that Susan Dudley sees this as an example of government overreach.... As someone who believes in getting the benefit-cost analysis right, I find this... disturbing.

Joshua Micah Marshall writes:

Talking Points Memo: by Joshua Micah Marshall: July 30, 2006 - August 05, 2006 Archives: White House nominates Susan Dudley to be OMB regulation czar. Last year she came out against fire-retardant kids pajamas. Bemoaning the dire burden of regulations last year on Jim Glassman's astroturf site, she wrote...

We also pay the price as consumers. From the moment we wake up in the morning -- flushing the toilet twice, courtesy of the Department of Energy's appliance standards -- to the time we put our children in their Consumer Product Safety Commission-approved pajamas, regulations not only increase the cost of goods and services we buy, but also the choices we can make.

The heavy hand of government stomping down on kid frying. Enough to make you a Hayek disciple after all.

As an expectant father I certainly hope that the government will stay out of our decisions about whether to put our child to bed in flammable pajamas.

And Vineyard Views reports:

Vineyard Views: The Fox and the Chicken Coop: This week Bush... nominated Susan Dudley to be the administrator of the Office of Information and Regulatory Affairs.... [S]he... feels that fatigue in truck drivers who do not rest has not been systematically proven to contribute to highway deaths.... She does not feel that we are entitled to information about the effect of some chemicals, "Even if we determine that information on the release of certain chemicals has a net social value, we cannot assume that more frequently reported information, or information on a broader range of chemicals would be more valuable"...

This kind of stuff--in a manner analogous to the b.s. perpetrated by Dan Quayle's "Council on Competitiveness" in the Bush I administration--degrades the power of the analytical tools we have to make government be the right size and do the right things. It makes it harder for people like me to argue that OIRA has an important role to play.

Dean Baker Thinks About the Job Numbers

He is somewhat worried. The BLS establishment survey has to guess at the number of jobs created in new businesses that aren't yet in its sample, and that makes it likely to miss economic turning points:

Beat the Press: Dean Baker's commentary on economic reporting: Job Numbers for Nerds (and Good Reporters)

As has been widely reported, the July job numbers came in somewhat weaker than expected, with job growth of just 113,000.... However, the actual picture may be somewhat worse.... [T]he Bureau of Labor Statistics (BLS) may be imputing too many jobs into the survey for new firms that are not included in their sample.

The... BLS knows that there are firms that cannot be counted in its establishment survey.... BLS must therefore impute some number of jobs for these new firms.... The problem is that the imputation will miss turning points.... In 2001, the imputation led to an overstatement of more than 400,000 jobs, an effect noted by astute observers at the time.

Is the imputation overstating job growth now?... We won’t know... until BLS releases it benchmark revisions next fall...

Lieberman Astroturf Edition!

Joe Lieberman cannot find any supporters to heckle Ned Lamont in Connecticut. So he has taken to airlifting lobbyists in from Washington DC:

CT-SEN: Richard Goodstein: "Email Me The Last Good Story You Wrote About Joe Lieberman" | TPMCafe: By Greg Sargent: D.C. lobbyist Richard Goodstein... confirmed that he is indeed the guy on the front-page of today's Record-Journal who appeared to be heckling Lamont in a diner.... [O]ne of the stories of the day in Connecticut is how supporters of Joe Lieberman ambushed Ned Lamont in a Connecticut diner.... Richard Goodstein shouted at Lamont: "Are you a Bill Clinton Democrat, or an Al Sharpton Democrat?"...

Election Central just reached out to the office of registered-D.C.-lobbyist Richard Goodstein, got his cell number, and reached him. When I asked him if he was a Lieberman supporter and was the man in the pic on the front of the Herald-Record, he confirmed that, yes, he was a Lieberman backer and that he was the same man as pictured on the paper's front page. Then the conversation went south. When I asked him if I could confirm that he'd said what the paper said he had, Goodstein asked me why I wanted to do that and whether I worked for the paper. I said I didn't and noted that I wanted to get confirmation of his quotes straight from him. After a hurried back-and-forth, Goodstein said: "Do me a favor: Email me the last good story you wrote about Joe Lieberman." When I asked why that was relevant, Goodstein said: "Bye. Bye." End of conversation.

Well, at least now we know for certain who the mystery man in the diner was, and that he's the same Richard Goodstein as the D.C. lobbyist Richard Goodstein. But I didn't get to ask him about the nature of the Lieberman supporters' surprise of Lamont or about the nature of Goodstein's relationship to the campaign. I've got a call into the Lieberman campaign about this. Hopefully we'll have more soon.

Pathetic. And funny.