Monday, June 13, 2011

Off by an Order of Magnitude....

Or two?
On The O'Reilly Factor, Gretchen Carlson falsely claimed that "about 35 percent of the in-state tuition people or students" at University of California schools "were illegals." In fact, only 0.34 percent of undergraduates in the University of California system in the fall of 2008 were "potentially undocumented" students who received the in-state tuition rate.*
To be fair, perhaps it was not intended to be a factual statement.

(College) Kids These Days

Scott Kaufman shares a few recent experiences with his students. (But then is it a surprise that students don't "get" the concept of attending class, completing their actual assignments and studying, given that "More than 36 percent of first-year students at two-year and four-year colleges took at least one remedial class in 2007-08" and alarming numbers of "B" high school students from certain districts require remedial classes in reading and math. And, like Kaufman, some professors simply won't tell you "what's on the test.")

Going back to the lighter side, I was reminded of an interaction between a teacher and student at a graduation reception:
Professor: Congratulations, Ms. Jones.

Student: You remember me?

Professor: Yes.

Student: But I was only in one of your classes. How did you remember me?

Professor: You sat in the front row and asked questions every class until about two weeks into the course, when you came up to me after class and asked, "Does attendance count." I answered "No" and never saw you again.

Saturday, June 11, 2011

Europe vs. The Washington Post's War Agenda

Fred Hiatt and his crew have published an unsigned editorial, chastising NATO countries for failing to spend enough money on their military forces. I'll outsource in part to Dan Larison's preemptive strike:
It may be obvious, but Gates’ two examples of non-U.S. NATO failings have nothing to do with European defense. Certainly, the limitations of European military power show that their governments remain dependent on the U.S. for security, but there are few worse ways to persuade European governments and publics that they have the wrong priorities than to lecture them on their insufficient support for Afghanistan and Libya....

As for Libya, it is important to remember that the governments that have contributed nothing to the war never wanted to attack Libya, and they wanted to keep NATO out of it all together. Gates directed his ire at several of these governments the other day, as if Germany, Poland, and Turkey should be expected to pitch in to support a military campaign they explicitly opposed. These are not the governments that wanted the U.S. to engage in combat missions in Libya, because they didn’t want any outside government taking military action in Libya. What Gates should have acknowledged when faced with the refusal of German, Polish, and Turkish governments to participate in bombing Libya is that Libya is not properly a matter for NATO and should never have been a NATO mission.
Hiatt's crew complains,
As [Gates] made clear, this country can no longer afford to do a disproportionate share of NATO’s fighting and pay a disproportionate share of its bills while Europe slashes its defense budgets and free-rides on the collective security benefits.
And Gates has different priorities than the nations of Europe, who see significant benefit in "free riding". For that matter, I don't recall Hiatt and his crew coming out against austerity measures in Europe. Even if we ignore how popular it would be for European nations to announce tens of billions in new military spending as they slash domestic programs, the question arises: how is increasing military spending consistent with austerity? As Hiatt knows from his own paper, Britain's austerity measures include significant cuts in military spending.

Hiatt's crew complains that Europe places too many restrictions on the rules of engagement when it commits troops to NATO ventures, and that Libya should be more important to Europe than it is to the U.S., presumably because it's closer? They also complain that the nations involved in the bombing of Libya don't have the resources to carry out a perpetual campaign:
Even fully participating members have failed to train enough targeting specialists to keep all of their planes flying sorties or to buy enough munitions to sustain a bombing campaign much beyond the present 11 weeks.

That should frighten every defense ministry in Europe. What if they had to fight a more formidable enemy than Col. Muammar el-Qaddafi’s fractured dictatorship?
Can we be honest for a moment? The fact that the European nations who wanted to participate in the Libyan adventure cannot sustain a 12 week bombing campaign against a nation in North Africa does not mean that they cannot defend themselves. The fact that they impose strict rules of engagement on their troops when deployed for NATO missions in Africa or Asia does not mean that, if faced with military invasion, they would apply those same rules. The fact that nobody is talking about using nuclear weapons in Libya does not mean that, when Europe faced an actual and potentially imminent existential threat, the probable use of nuclear weapons in its defense was not taken for granted.

I also expect that if the nations of Europe did perceive a growing, potentially existential threat, they would buy some additional planes and bombs in response. One reason not to do so is that, used or not, the ongoing cost of training, support and maintenance is significant. Another reason not to do so is out of recognition that when you have greater military capacity there's always somebody, within the state or on the outside, who wants you to use it. When President McCain says, "It's time to invade... Iran", it's easier to respond, "We can't" than "We won't."

In specific relation to Libya, the priorities here have less to do with Europe's ability to defend itself from proximate or imminent threats, and more to do with its unwillingness to pour huge amounts of money into overseas adventurism. Yes, sometimes threats do arise in other continents, and under some circumstances it may make sense to take military action in those nations as a matter of self-defense. But humanitarian missions, as the Libyan adventure was initially described, are not a matter of self-defense. And as should be obvious to anybody who has paid even slight attention to world history, past or present, military interventions often do not go as planned and often carry serious repurcussions. George W. Bush and Tony Blair presented Gadafi as proof positive of the success of the "War on Terror", and now he's a poster child for the evil despots of the world who must be removed at any cost... which in a sense takes us back to Reagan's time, except that Reagan put a pretty low ceiling on the cost he was willing to incur to depose Gadafi. How is this mission vital to Europe's interests?

Racism? I Don't See No Stinkin' Racism!

How could you possibly imagine that there's any racism here?
Bolling began the segment itself by saying, in part, "So what's with all the hoods in the hizzy? A month after the White House hosted the rapper Common, who glorifies violence on cops, the president opened his doors to one of Africa's most evil dictators. Here's Ali Bongo, the Gabonese president, who's been accused of human rights violations and plundering billions of his country's dollars."
Let's do a quick Google search for "Hoods in the hizzy". Okay... here we go:


Oops - Daddy Bongo, granted - you know those banana republics, in which power passes from father to son - but with the wrong hizzy host? With a dash of Jack Abramoff, to boot? Nothing to see there, folks....

Zero Tolerance Idiocy

It's not just for public schools, it would seem.

Friday, June 10, 2011

Perhaps the Word "Sexual" Doesn't Belong In The Question

I asked, "Do Sexual Ethics Matter in Politics" but, despite the tawdry details, when we're talking consensual acts between adults the voters seem to be pretty forgiving. Chase staffers around the office, solicit underage pages, pay for sex with minors, that sort of stuff? Often career-ending. The "I've made mistakes in my marriage"-level of misconduct? Despite the media interest in (presumably responding to a public appetite for) the tawdry details, on the whole voters seem to excuse it and move on.

Had Clinton said "I've made more mistakes in my marriage, am sorry for the pain I've caused, and the rest is between me and my wife," instead of "I did not have sexual relations with that woman", he would have saved himself and the country a great deal of turmoil. Had Mark Sanford announced that he was leaving his wife, instead of taking off with her to Argentina while having his aides cover up with a lie about his hiking the Appalachian trail, perhaps he would have survived his scandal. When you think about it, that makes sense: Your political career suffers the greatest harm when you lose your supporters, and the best way to do that is to lie to them, put them in the position of defending you, and having those who do come to your defense end up looking at best naive. And really, why should your supporters be expected to shrug off that treatment based upon the subject matter of your lie.

Newt Gingrich's Intelligence - Hidden in Plain Sight?

I keep finding assertions that Newt Gingrich is a brilliant man. Brimming with insights and ideas. Except... I have yet to read an editorial, hear a speech, or see any other actual evidence of that brilliance. I'm not arguing that he's stupid - not at all - but what I see seems like a pretty run-of-the-mill intellect for a successful Washington politician. Above average, but nothing to write home about.

I'm fully prepared to buy into Newt as the intellectual giant of the GOP, but only if somebody shows me the evidence. I won't even ask that you explain away his many mistakes - smart people make mistakes, and sometimes can think their way into trouble. Arguably a stupid man would have an easier time staying on message in today's Republican Party, as I expect it's easier to stay on the right side of litmus tests if you don't have the aptitude to think about whether the positions you're supposed to take are in fact what's best for the nation.

I come across smart people all of the time, including people whose political philosophies vary from my own. Am I missing something? Or is it that I am to be awed by his ability to promote himself and rake in huge amounts of cash by serving as the Ed McMahon of right-wing political causes, and conclude that anybody so good at enriching himself has to be smart?

Hands Off Our Slums?

A recent editorial in the Times complains about a competition "asking students, architects and businesses to compete to design the best prototype for a $300 house". The authors complain that the concept is too simple:
To start with, space is scarce. There is almost no room for new construction or ready-made houses. Most residents are renters, paying $20 to $100 a month for small apartments.

Those who own houses have far more equity in them than $300 — a typical home is worth at least $3,000. Many families have owned their houses for two or three generations, upgrading them as their incomes increase. With additions, these homes become what we call “tool houses,” acting as workshops, manufacturing units, warehouses and shops. They facilitate trade and production, and allow homeowners to improve their living standards over time.

None of this would be possible with a $300 house, which would have to be as standardized as possible to keep costs low. No number of add-ons would be able to match the flexibility of need-based construction.
If the $300 house is comparable to the $20 to $100 per month rental, even if you include the cost of a small plot of land it seems like a pretty good deal. And as for homewners, it's pretty easy to see how a $300 house could be conceived as a modular structure, subject to having additions. I'll grant, that's not a requirement of the contest, but it would be easy enough for somebody entering the contest to design a modular structure.

Whatever the faults of a thought experiment such as this, that's all it is. The winner's idea is not going to replace all alternatives for the slum dwellers of the world, and even less so if it would not meet their needs. But the winning idea may provide a framework for providing even better value for the residents of "slum" housing - how to improve hygiene without breaking the bank, or how to implement solar heating or cooking and save money on fuel.

The authors also express concern that if, in fact, the contest results in the broad availability of cheap, attractive, quality housing, it will hurt the local construction industry. And yes, at that price point we probably would be talking about pre-fabricated housing, reducing the need for local workers and probably reducing the need for continued repair and maintenance. But... what in life is not a trade-off? Is it better that some people have to seek other lines of work, or that other people who would prefer the relative quality and sanitation offered by the winning design continue to live in less suitable housing in order to preserve that status quo?

The authors also appear to presuppose that the winning design would have to be implemented on a wholesale basis, rather than replacing individual housing units within the existing community:
The $300 house responds to our misconceptions more than to real needs. Of course problems do exist in urban India. Many people live without toilets or running water. Hot and unhealthy asbestos-cement sheets cover millions of roofs. Makeshift homes often flood during monsoons. But replacing individual, incrementally built houses with a ready-made solution would do more harm than good.
Even if we assume that every entry in the contest would require the bulldozing of neighborhoods, and I doubt that such an assumption is well-grounded in the facts of the competition, the authors are free to make their competing proposal. For that matter, they can start their own contest with their own preconditions and price point, including that the proposals be for homes that, with appropriate assistance, local residents could build for themselves.

"I Didn't See This Coming, Either"

In the past couple of months I've seen the documentary, Inside Job, a competent explanation of how the financial industry crisis arose, and of the ensuing collapse and bail-out. There are no big surprises for those who followed the crisis, but it's a good refresher course - and probably a good primer for those who are still wondering how the crisis occurred. I also saw the star-studded HBO dramatization of Andrew Ross Sorkin's novel, "I Love You, Hank Paulson" Too Big to Fail. That production offers a frenzied account of how the crisis was handled, but (in my opinion deliberately) omits mention of how the crisis arose or what has happened since Paulson "forced" the nation's biggest banks to accept billions of taxpayer dollars, no strings attached.

Two things struck me about the HBO production. First, if Sorkin's account is accurate, perhaps Henry Paulson's epitaph should be, "I didn't see this coming, either." Perhaps in order to maintain him as a sympathetic character, there's next to no mention of Paulson's background in Goldman Sachs, and what mention there is comes in the form of telling us how unfair it is that the government is viewed as being unduly influenced by the former Goldman Sachs employees who manage the treasury, or how hard Paulson worked to save Lehman Brothers (merely, we are told, the seventh largest investment banking firm in the country - why would Goldman Sachs care about such a minor player) and how it was that bank's intransigence and not Paulson's policy that resulted in its bankruptcy. There may be truth to that, but it's still very interesting how much effort Sorkin applies to salvaging Paulson's reputation as opposed to explaining how Paulson managed to avoid recognizing the perilous condition of the financial sector before we reached the crisis point. Seriously - thanks to Sorkin I now know Paulson's religion and that he has to be arm-twisted to take a sleeping pill (which he may or may not have actually taken), than I do about his history with Goldman Sachs.

The film ends with Paulson expressing a hopeful but concerned expectation that the banks would follow through on their implied promise to lend out the billions of "no strings attached" dollars to boost the economy, but unlike the rest of the film in which Sorkin's interpretations and conclusions are spoon-fed to the audience, you only "get" the ending if you already know that the banks did no such thing - but you're expected to believe that Paulson didn't see that coming. From Sorkin, you get no sense of any of the inside dealing and willful blindness that was behind the bubble or AIG's failure. This is stuff that just happened - a perfect storm, it would seem, of industry actions for for which nobody should be held accountable. You get no sense of regulatory capture - but as I've commented, Sorkin's coverage of the financial industry seems to me to be the journalistic equivalent of regulatory capture. The dramatization of his book reinforces that perception, and then some.

Some of the explanations for policy choices are left with the not-so-credible statements we've previously received. For example, we have no choice but to give the nation's biggest banks all those billions of dollars because if only the failing banks are given money everybody will know which banks are failing. The competing explanation, that it would not be fair to the non-failing banks if their incompetent competitors get that kind of boost and they do not, is omitted. But by the time of that cash infusion, everybody who was following the crisis knew or could easily determine which banks needed the money and which did not. The "we need to maintain a level playing field" argument would have been more credible; although I suppose that would have undermined Sorkin's explanation for why no strings could be attached to the money. You could achieve that level playing field by offering the money, strings attached, on equal terms to every bank. And not so much as a whisper about how your word is your bond in the financial and insurance sectors - maybe that's a rule only for insurance companies?

Timothy Geithner, on the other hand, gets no similar amount of love. When he's on screen the goal seems primarily to be to attribute to him some of the worst and least popular aspects of the bail-out - blank checks for the banks, "cash for trash".... That may be entirely fair. Whatever I can make of defenses of his intentions and integrity, I can't recall the last time I've heard a defense of his competence in relation to the management of this crisis. But really, given how a simple measure such as some form of bankruptcy cram-down for homeowners' first mortgages could have helped over the past two years, simplifying the process of getting people out of their upside-down homes without foreclosures or short sales, keeping struggling people in their homes, and in stabilizing housing prices, who could muster an energetic defense for a guy whose only concern was in shoveling as much taxpayer cash as possible, no strings attached, into the institutions most responsible for the nation's problems.

No, We Won't

Tom Friedman, having noted that the world's population is consuming resources at a faster rate than the world can replenish them, closes his column by quoting Paul Gilding,
“We are heading for a crisis-driven choice,” he says. “We either allow collapse to overtake us or develop a new sustainable economic model. We will choose the latter. We may be slow, but we’re not stupid.”
Is there anything in human history that would suggest that, when faced wit economic or environmental catastrophe, a major nation will reverse course and avoid that catastrophe? Is there anything in present economic or environmental policy that would suggest a present willingness to reverse course - to consume less, pollute less, limit population growth in cities and countries with inadequate supplies of food and water.... Seriously, I understand wanting to close on an optimistic note, but what I tend to see is complacency (it won't be so bad), denial (the problem doesn't exist), selfishness (it may be bad for others, but it won't be bad for me - and I may even turn a profit), wishful thinking (we'll produce a magic new technology that will fix everything), laziness (it's too hard).... Where does Gilding find a basis for optimism that this time will be different - not another Mayan Empire, Easter Island, Haiti....

History teaches us that to the extent that the world eventually does "choose" a new, sustainable economic model it will be a choice forced by imminent collapse, or it will be a forced choice that follows the collapse. I would love to be proved wrong, and we're certainly capable of better, but I'm not seeing much evidence that supports optimism that "this time will be different". (But perhaps things look different to Friedman, as he pulls his Lexus SUV into the driveway of his lavish mansion, a lifestyle he appears to view as completely sustainable and consistent with what he preaches in his columns. Let me guess... his pool is now solar heated?)

Tuesday, June 07, 2011

Do Sexual Ethics Matter in Politics

I often hear it argued that a politician's private life should remain private, and that infidelity should be considered irrelevant to a politician's public life. This is true to a point - if you know that a particular politician is inclined to have extramarital affairs and you elect him anyway (cough Clinton cough) then you shouldn't pretend its a huge shock or somehow an indictment of his character when he continues to act in character. If you care that Rudy Giuliani occasionally dresses in drag don't vote for him - but it's public information and the voters elected him knowing that he likes to play dress-up (and I have no reason to believe that, in his case, it's anything but a lark).

I heard it argued that the breaking of the story in relation to John Edwards was a public service, as he was hiding a scandal from his supporters and donors that would have devastated his chances of election had he been nominated for the Presidency, and similarly that the disclosure of Anthony Weiner's exploits on Twitter was a public service to the voters of New York who might have supported him in a run for mayor. The implication of that argument is that, absent an election, the behavior of both men is irrelevant to their public lives. I've also heard it argued that if you take Newt Gingrich's infidelity while married to a cancer-stricken wife and combine it with Arnold Schwarzenegger's love child you have John Edwards - but Gingrich is deemed a serious presidential candidate and Schwarzenegger's image is at worst a bit tarnished. Is that fair?

Well... yes. It isn't so much that Edwards suffered a collapse of his public persona because he had an affair that resulted in a child, so much as it is that he was revealed to have a private life completely at odds with the persona he was selling to the public. And when it looked like he was going to be caught, the cover-up was pretty outrageous.

But I think there's something else that the "It's their private lives" crowd is missing. The question of whether you can neatly compartmentalize fidelity - "He cheats on his wife and fakes his religious fervor, but I trust him to be faithful to his oath to uphold and defend the Constitution." Perhaps some compartmentalization is possible. Perhaps Bernie Madoff would never have dreamed of stealing from the collection at his synagogue, even as he happily ripped off his investors.

Perhaps with some relationships the flexibility of the marital vows is part of an explicit understanding between the partners (although that was pretty clearly not the case with Edwards - although that brings us back to the issue of lying to voters and supporters over something that could blow up during an election. Perhaps you can rationalize the deception in those cases - it's society that's being unreasonable in holding that a perfectly qualified individual is "unelectable" if he has an open marriage or is an atheist, and thus he's justified in pretending otherwise in order to obtain and hold office. But it seems to me that most people act pretty consistently across their lives - if they don't steal at work, they don't steal at church. If somebody like Madoff doesn't steal at church it's probably because it's too little money to be bothered with - but if that church were to have a considerable endowment and were to invest with him, "game on".

I personally believe that somebody who is dishonest in relation to the most central personal relationship of their lives is likely to display the same level of dishonesty in other contexts. Liars lie, cheaters cheat, and thieves steal. Some dubious behavior may hint at personality traits that could be beneficial to a political leader - if we're honest, there are times when a psychopath's sang froid, ability to fake emotion, lack of conscience, and ability to lie without the usual outward signs of deception could be useful to a President. That's not to say we want a psychopath in office, but maybe we do want a guy who can have a huge scandal break just before his State of the Union Address, and who will nonetheless proceed to present that speech as if nothing untoward has happened. Both the human psyche and the world are complicated. But if you're electing a thief, liar or cheater, you should have the opportunity to know what you're doing.

Update: In the New Yorker, Hendrik Hertzberg argues that
[Weinergate] confirms a pet theory of mine: the Clinton Rule, which states that when a married politician appears before cameras and microphones and starts babbling absurd lies about some sexual something, the person he is really trying to lie to is his spouse. The lies that get told to the public and the press are side effects.
and
By itself, the fact that a person has lied about sex tells you nothing about that person’s general propensity to lie.... If the politician is a habitual or characterological liar, the public record will show it and the lying-about-sex is redundant. If the politician is not a habitual or characterological liar, his lying-about-sex is misleading—is itself a lie, in a way.
Hertzberg assumes that the public record will be both available and clear. It may be that it's the lies about infidelity that lead people to look more closely at the rest of a politician's record. But he's also compartmentalizing behaviors, as if you believe that a person's essential character is consistent across the board, somebody who cheats on his spouse is in fact likely to display similar conduct in other contexts. Even if we limit it to "He'll only lie to me if it's necessary to save his political career," and even if I think that a public reaction to his infidelity would be exaggerated and thus sympathize with his desire to keep it secret, I don't see why lying to save his career in this context would not suggest that he will lie to save his career in other contexts. Frankly, if the argument is that the public needs to shift its opinion on infidelity and be less judgmental of politicians' affairs, even if there is an individual price to pay before cultural perceptions shift, politicians would do themselves and their peers a much greater service by being honest.

Friday, June 03, 2011

Groupon Deal: Buy Early Shares for $10 and Get $50 Worth of Investor Money

That's not intended to be a literal expression of Groupon's business model or IPO, but as Frank Reed notes, early investors have been doing very well on their Groupon shares:
And remember when Groupon raised $950 million not so long ago? Guess what that did? It simply paid out the early investors in handsome sums. It did little to build the business. You can get the details in the All Things Digital post.
If history should teach us anything, it's that the financial industry loves bubbles. It loved the profits it made during the first Internet bubble. It was ecstatic over its profits during the housing bubble. And now, having been bailed out, pampered, and guaranteed immense profits and compensation at taxpayer expense on the ground that they're "too big to fail", why not do it again? Besides, a few IPO's that result in pumped up valuation, enormous, easy profits for early investors, insiders and investment banks, and... well, quite possibly not much for ordinary investors in the longer term, if that counts for anything... don't make for a bubble, do they? It's just a few hundred billion, maybe a trillion. Chump change.

I am of the impression that Groupon's founders want to build a sound, dominant business. But that doesn't mean they don't want to cash in. Is that the new economy? Build a $billion business, a $5 billion business, a $10 billion business, a remarkable accomplishment in itself, take it public at a ridiculously inflated valuation, the bankers, and investors and founders get rich beyond fabulously rich. As for the ordinary people left holding the stock? Sure, they may have paid $50 for $10 worth of company, but they got the exact number of shares that they paid for. Whose fault is that?

"Conventional Valuation Models Don't Apply to Us"

I recall, back in the days of the first Internet bubble, how the popular wisdom was that there was incredible value in "eyeballs" - the volume of traffic to your site, and information you might glean from your users, was far more important than turning a profit... or even generating revenue. As it turns out, although there have been innovations in how traffic and information can be monetized, it is important to generate that revenue.

I commented recently (and cynically) on the LinkedIn IPO, taking the position that the argument that the bankers put one over on LinkedIn's owners was a stretch. It seemed, and still seems, more symbiotic. LinkedIn, its owners and the investment bankers who handled the IPO made tons of money. Whether or not LinkedIn ever generates enough revenue to justify a tenth of its present valuation, its owners and early investors will walk away with truck loads of money. Meanwhile, the businesses of the nation's proverbial "Main Streets" have difficulty obtaining financing. Wow. There's less risk in floating a multi-billion dollar IPO for a business that has no clear plan or path to justify its valuation, than in investing in traditional brick and mortar businesses. There must be, because you can see for yourself what banks are doing.

Groupon plans to be the next business to clean up through an IPO:
The IPO, which could value Groupon at $15 billion to $20 billion, prompted Richard Brenner, president and CEO of financial-advisory firm The Brenner Group, to say that he would tell would-be investors to “sit out” the IPO because Groupon “doesn’t appear to have a sustainable business model yet.”

“Why would the public support a company that can’t figure out how to be profitable?” Brenner said.

But Mark Lehmann, a Wilmette native who heads up JMP Securities in San Francisco, said investors are clamoring for a long-awaited IPO by a company that shows such terrific growth.

“Groupon has the brand and the first-mover advantage, and it is extremely well-regarded,” Lehmann said.
Groupon came into business with a simple but clever idea, and its latest efforts suggest that it is capable of innovation. But this type of thing makes me nervous:
We don’t measure ourselves in conventional ways.

There are three main financial metrics that we track closely. First, we track gross profit, which we believe is the best proxy for the value we’re creating. Second, we measure free cash flow—there is no better metric for long-term financial stability. Finally, we use a third metric to measure our financial performance—Adjusted Consolidated Segment Operating Income, or Adjusted CSOI. This metric is our consolidated segment operating income before our new subscriber acquisition costs and certain non-cash charges; we think of it as our operating profitability before marketing costs incurred for long-term growth.
A more sophisticated explanation, certainly, but why does the phrase, "We make it up on volume" come to mind?

Thursday, June 02, 2011

Substance vs. Grandstanding

The Republican Party (a/k/a "The Grand[standing] Old Party) is taking time out from its game of chicken with the economy to possibly team up with Dennis Kucinich to pass a resolution against the continued military involvement of the U.S. in Libya. Dan Larison writes,
If the Kucinich resolution passed, that would be great news, but I have to wonder if it would change anything in the near term. The administration would have a problem if it just ignored it and flouted it, but it is already ignoring and flouting the law, so why wouldn’t they do the same to the Kucinich resolution? The resolution directs Obama to withdraw U.S. forces from the war within a specified period of time, but the administration clearly pays no heed to deadlines set by Congress.
That's the thing about meaningless gestures - they're meaningless. Congress has the power to set hard deadlines, to cut off funding. Instead, we're talking about a deliberately toothless resolution. Members of Congress can pander to one group or another, or set themselves up for a campaign commercial, while doing nothing. And let's not forget, the reason we're in this situation in the first place is that for decades Congress has been unwilling to fulfill its constitutional role in relation to the declaration of war and has happily delegated that responsibility to the President. Even as the GOP ponders following or imitating Kucinich, look at what John Boehner has to say:
Boehner, though, says Obama is “technically” in compliance with the war powers requirements.
Wow - what a ringing endorsement of Larison's position that the Obama Administration is "flouting the law". Or, for that matter, Glenn Greenwald's.
And note the individuals on whom Obama is now relying to protect him from this bipartisan effort to put an end to his illegal war: "GOP House leaders" -- John Boehner and Eric Cantor, who refused to allow the bill to come up for a vote despite ample support among conservative members of their caucus as well as numerous liberal House members. Can we hear more now about how the two parties are so radically different that bipartisan cooperation is impossible? The Emperor has decreed that we will fight this war, and thus we will -- that seems to be the prevailing mindset.
Let's be honest for a moment - this is not a bipartisan deference to "the Emperor" - it's about "How will this look in a TV commercial (either mine or my opponent's)?" Cantor and Boehner fear commercials about how they "let Gadafi win", or about how "They didn't stand behind the troops," or describing how the President had to "stand up to them" in order to prevail in the toppling of a "terrorist dictator". You want them to vote against the intervention in Libya? Find a way for them to spin the vote against the President in the next election and they'll be all over your bill.

Maybe There's a Different Reason

A few days ago, Paul Krugman wrote,
Since some time in the fall of 2009, Obama’s rhetorical stance has been basically that he’s like the GOP, but less so; can you even remember him offering a full-throated defense of Keynesian policies?
I admit, I've never met the President and have certainly not had the chance to discuss economic policy with him or his advisers. Perhaps President Obama gave that full-throated defense in private and I'm dead wrong. But... one thing I have noticed about President Obama is that you can generally take his statements at face value. Perhaps the reason that the President appeared to take the position that "the [stimulus] half-measures it was actually able to get were exactly right, not a penny too small" and doesn't speak forcefully in the defense of Keynesian policies is that he was convinced that the stimulus package was adequate and wasn't convinced at the time by Keynesian policies.

To the extent that he might now be more convinced by Keynesian economics, we're back to political constraints - whether or not it should be, between the efforts of the Tea Party, Republican Party and the bulk of the mainstream media, we're not in a political climate in which we can have a sensible discussion about budget deficits and stimulus spending.

Wednesday, June 01, 2011

Time to Change or Eliminate Software Patents

Fred Wilson on patent trolls:
The whole thing is nuts. I can't understand why our goverment allows this shit to go on. It's wrong and its bad for society to have this cancer growing inside our economy. Every time I get a meeting with a legislator or goverment employee working in and around the innovation sector, I bring up the patent system and in particular software patents. We need to change the laws. We need to eliminate software patents. This ridiculous Lodsys situation is the perfect example of why. We need to say "enough is enough."
I've commented on this issue before; it's one that affects most people but few know about and fewer care about, hence the status quo. Once big companies build a portfolio of patents and have sufficient revenue to pay off trolls as necessary, they mostly seem to become complacent about the current system as it serves as a barrier to entry for potential competitors.

Saturday, May 28, 2011

Iraq, Iran, Sunni, Shiite, Arab, Persian... What's the Difference?

Daniel Larison does a yeoman's job holding political candidates accountable for their foreign policy blunders, in the past commenting on notable gaffes by such notables as Mitt Romney, even as the mainstream media displays a lack of interest or pretends that the remarks are insightful. He recently commented on Tim Pawlenty's confusion of Iraq and Iran:
The reporter corrects him at this point, and Pawlenty gamely tries to recover. The most that can be said for Pawlenty in this episode is that he is giving better foreign policy answers than Herman Cain. It’s also fair to say that he’s already doing worse than then-Gov. Bush was doing at this point in 1999. It’s pretty clear that he was rehearsing a bad answer on the U.S. troop presence in Iraq, which had almost nothing to do with the question he was asked. He was asked a question about contradictions in U.S. regional policy related to the expansion of Iranian influence, and he wasn’t even attempting to answer that question. He went through his answer substituting the words Iran and Iranians without missing a beat, and that is probably because his grasp of these subjects remains very superficial. If it had just been the name of the country, everyone might be able to shrug it off as a slip of the tongue, but it was more than that.
I'm with Larison on this one - well, no, I'm not quite as sympathetic to the "slip of the tongue" argument. While, particularly in retrospect, the import of Bush's ignorance of South Asia, and the treatment of Gore's knowledge of the region and its leaders as a pedantic irrelevancy, seems wholly irresponsible on the part of the media, there is a huge difference between not knowing the name of the President of Pakistan and confusing Iran with Iraq (even if we overlook the fact that Pawlenty did not display even a glimmer of understanding of the question asked).

Pawlenty was born in 1960, meaning that if he followed international events at all he should have overcome any ability to confuse Iran and Iraq by the time he reached his early 20's. It's not a grave sin to not care about or follow international affairs, even to shrug off conflicts in the Middle East, in favor of domestic concerns - or even to switch off the world news to catch sports updates on ESPN. It's possible to govern a state without knowing or caring much about international affairs. There are also degrees of ignorance, some of which suggest a basic interest or knowleged that a charitable person might argue could be overcome - confusing Shiite and Sunni, for example, as McCain at times did. But if you were a young adult during the Iran-Iraq War, subsequently lived through the first Gulf War, and are claiming to be competent to be President during this period of massive military intervention in the Middle East, that level of ignorance and confusion demonstrates a lack of interest that suggests that your place is, at best, in state and local politics.

An adult who can't differentiate a scapula from a patella? Probably not the best candidate for medical school. An adult who confuses Mississippi with Massachusetts? Probably not the best candidate for governor. They may be very competent within the sphere of their jobs and informed within their ares of interest, and they may be capable of learning the facts if given enough time and tutoring, but their inherent lack of interest in the subject matter does translate into a high probability that the best we can expect from them is basic competence. We should expect a lot more from somebody who claims he's qualified to be the President.

Friday, May 27, 2011

Is it Safe for Republicans to Make Sense?

While Newt Gingrich scurries away from his accurate assessment of Paul Ryan's plan, apparently because Republicans aren't allowed to disagree with the plan, Paul Ryan himself seems to be scurrying away from his plan, or at least insisting that it isn't fair for the media to accurately describe its effects. I guess in an odd way that makes sense - the two men agree that it's completely unfair for the media to accurately report on their words, beliefs and actions.

But don't worry - David Brooks tells us that there are two or three reasonable people in the Republican Party, and they're talking to him.
Already many consultants are telling Republicans to drop austerity and go back on offense: Spend 2012 accusing the Democrats of sponsoring death panels. The Democrats will spend 2012 accusing Republicans of ending Medicare. Whichever party demagogues best wins.

But, over the past few days, I’ve spoken with a number of Republicans — in Congress and elsewhere — who don’t want to do that. They fervently believe the country is in peril. They want to find a way to reduce the debt without committing political suicide.
Great. And their names are... off the record? It is such a toxic environment within the Republican Party that you can't even make an on-the-record statement against demagoguery?

Brooks proposes that the Republicans should increase taxes on the middle class by eliminating employer's tax deduction for employee health insurance, and further "raise tax revenues on the rich". He does not claim that any of his anonymous Republicans support this idea. I suspect he's playing a rhetorical game - "Here's how the Democrats are being reasonable, while these are reasonable things the Republicans could do," rather than admitting that his ideas, whatever their merits (and if you read his columns you know that they mostly lack merit), have no traction in the Republican Party.

I sometimes wonder if Brooks should stick with his pop psychology and thinly disguised book reports, as it seems that when he starts presenting his own ideas he goes quickly and hopelessly wrong. His memory of recent history suggests he takes in more fumes from the beltway than he does facts:
Republicans won in 2010 because the working class fled from the Democrats’ top-down big government liberalism.
From the perspective of the reality-based community it had a lot to do with a crappy economy, anger over bailouts that were for the most part a continuation of the prior administration's policies, Republican demagoguery over Medicare ("death panels", "Medicare cuts to pay for other (undeserving) people's health insurance") and stimulus spending ("The stimulus bill was horrible. I'm proud to have delivered $50 billion in government spending to my district, and am happy to pretend it had nothing to do with the horrible stimulus bill). Oh - and let's not forget Republican demagoguery on immigration.

Brooks defines the issues that he believes motivate voters who, when not instructing the government to keep its hands off of their Medicare, supposedly want small government:
But these families have seen the pillars of their world dissolve — jobs, family structure, neighborhood cohesion.
Jobs? That would be "It's the economy, stupid," but what's this nonsense about "family structure?" Which faction of Republicans votes for Members of Congress based upon their concern that Aunt Sallie and Uncle Bob might get a divorce? Is Brooks in fact talking about demagoguery on gay marriage - a return to the culture wars, a successful topic for Republican demagoguery in past elections? "Neighborhood cohesion?" Yeah, I guess we are talking in silly code. What does that mean if not, "People of the wrong color are moving into our neighborhoods."
They need to lay out the facts showing that Medicare is unstable and on a path to collapse, as Representative Paul Ryan is doing. But they also need to enmesh Medicare reform within an agenda to build solid communities: more money for community colleges and technical schools, an infrastructure bank, a values agenda to shore up marriage and family cohesion, tax holidays to help the unemployed start businesses, tax reform to limit special interest power.
First, Paul Ryan is not laying out facts. His "budget" is a pile of nonsense, and he is being anything but honest about his plan to privatize Medicare. Second, as Brooks acknowledged up front, Republicans are running scared because when voters recognize the implications of Ryan's plans they hate them. And it's not even clear that voters yet fully understand that Ryan's plan to gut and privatize Medicare is not so much about preserving health insurance for seniors as it is about providing yet another round of massive tax cuts to the wealthy.

In terms of Brooks' concepts for Republican spending, yes, it's easy to spend more money on community colleges. But if you really want to get that done you would be talking about potentially peeling off enough Republicans to join in a Democratic effort to provide education funds - because the Republican Party is all about cutting and they've already promised more in cuts than they can deliver. "Build solid communities"? Could you be less specific and just maybe sound a bit more (to Republican ears) like a big government hippie? An "infrastructure bank" - a centralized agency charged with arranging finance for infrastructure projects - with an eye toward budgeting for and increasing spending on infrastructure? Even if you recognize the sorry state of our nation's infrastructure, do you seriously believe the Republican Party is going to get on board with that? A "values agenda", meaning... what other than culture war demagoguery? "Tax holidays" to help the unemployed start businesses? Pie, meet sky. "Tax reform to limit special interest power"? Not even John McCain seems inclined to support that type of reform.

When David Frum looks at the Republican Party that drummed him out, he sees a need to transform that party into the type of party that might adopt some of Brooks' theoretical platform. He should be paying attention to Brooks: It's safer and much more lucrative to pretend that party already exists.

Wednesday, May 25, 2011

Tuesday, May 24, 2011

Medical Malpractice Tort Reform and Federalism

Following up on some Volokh Conspiracy posts about the relationship between tort reform and federalism, Jonathan Adler quotes Walter Olson on the subject. Olson suggests that there is
a very real difference between areas like product liability and nationwide class actions—in which suits ordinarily cross state lines, and the majority of runaway verdicts are against out-of-state defendants—and more conventional kinds of tort litigation arising from car crashes, slip-and-falls, and medical misadventure, where cases are mostly filed against locally present defendants. As a rough rule of thumb, it’s worth presuming that most of the local suits do not externalize heavy costs across state lines and should accordingly be left alone by Congress unless it is itself vindicating some constitutional right or coordinating the functioning of some constitutionally authorized federal government activity.
Adler extrapolates,
Olson is anything but an opponent of tort reform generally. Indeed, he’s been one of the litigation explosion’s most prominent critics. But he recognizes that support of a particular policy goal does not require abandoning a principled commitment to the broader federalist scheme.
I'll take Olson's comments at face value, but let's recognize that not all insurance companies or medical industry lobbies want federal "tort reform". This battle has already been mostly won at the local level. It's difficult to conceive of a federal "reform" that would so heavily favor industry as to preempt state laws and caps that are less restrictive than the federal standard while allowing states to set more stringent standards and lower caps. Which is to say that states like Texas, that have all-but-eliminated medical malpractice as a viable tort, would likely see a federal reform reduce the burdens and hurdles they have placed in front of plaintiffs.

Further, part of the reason for local success is that it has become relatively cheap and easy to influence state legislatures and appellate courts, with insurance companies pouring millions into state supreme court races with the intention of electing judges favorable to their positions on such issues as tort reform. Following them Ohio Supreme Court's rejection of damages caps in malpractice case, the insurance and medical industries worked hard to change the composition of the court - not to change the law or state constitution, but to change the judges who interpreted and applied the laws and constitution - with the result that a reconstituted state supreme court found damages caps to be permissible.

If you federalize restrictions on medical malpractice cases you change that context significantly. Suddenly a single example or case can be used to propel a national public relations campaign to make the system more fair - and if you're honest about the impact of tort reform you know that's the opposite of what the insurance companies want. Reforms that increase the cost of litigation for plaintiffs but do little to nothing to improve the integrity of the system, such as requiring "certificates of merit" in association with the filing of a malpractice suit, might be challenged. Low, one-size-fits-all caps on "pain and suffering" damages might be revealed as absurdly low for certain severely injured patients - as they are. Caps would likely also be indexed to inflation, rather than remaining subject to a rigid, unchanging cap for years or decades.

In implementing tort reform, it is conceivable that Congress would do a better job than most states in creating a fair and balanced system. That isn't going to be reassuring to the insurance industry, so we can't be particularly surprised if national tort reform advocates find sudden value in federalism - you don't bite the hand that feeds you. Why, despite an express willingness to include tort reform in the Health Care Reform Act, did the issue all-but-drop off the radar in the otherwise contentious debate over the bill? In my opinion, because federalizing the issue is no longer a priority, and for the reasons I just provided may in fact be viewed as a negative, by a healthy proportion of health and insurance industry lobbyists.