JayB

They've been singing from that very sheet of music in Euroland for decades and it doesn't end happily. The day of reckoning is here: http://www.nytimes.com/2010/12/01/business/global/01bonds.html?_r=1&partner=rss&emc=rss

There are two things that are going to get us out of this mess. The first is bringing debts down to a level that we can actually repay. This will happen with a combination of structural reforms and bondholder/creditor haircuts. The second is liquidating the cumulative malinvestment in real-estate and other sectors and letting employment shift to sectors that are producing things that people still want to buy. Demand for luxury condos, CDOs, and Escalades is never going to come back. Reality has changed, the composition of demand has changed along with it, and patterns of production and exchange have to change in response to reality. Pumping a gajillion dollars into busted sectors will prevent the expansion of those sectors of the economy where the unemployed might be able to find new jobs. The sooner we accept this fact - the better. Just rolls off the tongue doesn't it? Yeah, creditors and bondholders need to take haircuts, the question in this and other countries is whether or not finance has captured enough state power to determine whether they'll have to take the losses or whether they'll be able to squeeze enough out of citizens through structural adjustments (their haircut or our amputation). As to the second part: Hmmmm, things people still want to buy, which are labor intensive enough to put a significant number of people to work, that Americans are skilled enough to make or at wages low enough to make them competitive with African slum-dwellers, that the resources are inexpensive enough to source, that people can buy without relying on credit, that... Yeah, let us know when you got some specifics. The funny thing about the Euro crisis is that the self-styled foes of the market are the ones that are digging in their heels the most when it comes to transferring the pain to creditors and bondholders, instead of forcing it all onto the public. There isn't enough economic output in Europe to cover all of their debts. A restructuring is inevitable, part of that will be haircuts for bondholders - and the longer the folks who are attempting to show the market who's boss deny this the worse things will be for all concerned. As far as your list of requirements is concerned - you are making the argument from personal incredulity. Pretty much the entire private workforce is engaged in employment that satisfies your criteria at this moment in time, even if neither you nor any other single intelligence can correctly identify or predict all of the factors that make the transmission-fluid plant more viable in Texas than Nigeria at this particular point in time. As the composition of demand changes, so will the composition of employment. More people will stay employed if we allow the distribution of employment to respond to reality, than if we stick our fingers in our ears and deny it, or engage in futile attempts to predict it in the form of a "5 Year Plan."

Exactly.

There are two things that are going to get us out of this mess. The first is bringing debts down to a level that we can actually repay. This will happen with a combination of structural reforms and bondholder/creditor haircuts. The second is liquidating the cumulative malinvestment in real-estate and other sectors and letting employment shift to sectors that are producing things that people still want to buy. Demand for luxury condos, CDOs, and Escalades is never going to come back. Reality has changed, the composition of demand has changed along with it, and patterns of production and exchange have to change in response to reality. Pumping a gajillion dollars into busted sectors will prevent the expansion of those sectors of the economy where the unemployed might be able to find new jobs. The sooner we accept this fact - the better.

Funny how the conservative press (and let's face it, when it comes to economic issues, "they're alll neoliberals now") was saying how commendable the Irish people were for bailing out the banks, taking all this laying down, stiff upper lip, "doing what needs to be done", and all. That was before the details of the depth of the cornholing regular shmoes were going to take on behalf of the billionaires and the protests erupted. Anyway we do have you two shitheels' personal take on the kind of democratic actions at least one of you miraculously now finds commendable. You're confusing identifying the best of two dismal options with praise. Reforming spending to a level that can be financed by the national economic output instead of racking up massive and unpayable debts that eventually bankrupt the country is wise and commendable, because the alternative to doing so is so stupid and ruinous. The fact that this counts as "austerity" these days is quite telling. Irish tax revenues were bound to take a massive hit in the wake of the property bubble collapsing, even without the government making the disastrous decision to try to cover the private tab for all of the busted luxury condo complexes and million dollar shacks.

Jay isn’t actually answering the post of mine he cited. He is answering the next post I wrote in which I briefly compare neoliberal propaganda regarding Greece versus Ireland and their tries to draw a parallel with our situation to target everything public, continue their war against the commons and dismiss all attempts at controlling a financial sector gone rogue. Jay isn’t directly answering my comment because what I said cannot be denied. Government budget shortfall that regressives wring their hands in despair about is almost all due to speculation in the financial sector, the market crash that ensued, its effect on the real economy and resulting decreasing capacity to raise revenue (not entirely new thanks to their long-term war against government). Regressives only offer solutions meant to decrease public spending as if there were a relation between the medicine they suggest and our economic health but they have shown no such relation and they haven’t shown any benefit for OUR economy; on the contrary, cutting spending like wages, unemployment benefits, job programs, etc will surely deepen the crisis as shown by Ireland and others. Perhaps, but not for the reason you mentioned, Greece’s debt arose because of a culture of systemic corruption and failure to raise revenue (remember: retirees paid more taxes than attorneys and doctors, and public funds were hijacked for private profit). Public spending is bound to translate into public debt when private interests capture the revenue stream irrespective of the need for reform. Insolvency follows when financial speculators smell blood and cause the interest on the debt to balloon to unsustainable levels. It has less to do with smelling blood than it does with someone at CalPers or its equivalent looking at the yield on a Greek note, considering the risk, and then asking themselves - "Is it a good idea to loan country X billions of dollars that might not be repaid?" If the answer is no - up goes the yield, if there are any buyers at all. It certainly wasn't commendable or wise for the Argentinian public sector to borrow more than they could possibly repay under any terms - but the ultimate responsibility for evaluating the soundness of a loan lies with the person doing the lending. Argentian hasn't exactly been the model of fiscal probity for the last century or so, and anyone lending them money was taking a significant risk. When those risks manifested themselves in a default - they weren't entitled to a bailout. Neither is anyone that lent money to Irish banks to finance a ludicrous property bubble. The lesson here isn't that you should should use public money to cover unpayable private debts, or that the public sector should overspend until the state is hopelessly in the hole and stick it to the creditors who were dumb enough to lend you money. It's that you shouldn't go down either path if you can help it. At the moment we *are* following the folks in Greece, Portugal, Spain, etc down the path to ruin - but we have a bit more breathing room for a variety of reasons. For now.

Funny how that happens when FIRE captures a large enough portion of state power... See above. IIRC the financial sector was at least as large relative to GDP in Iceland, if not significantly larger, and the Icleandic government, by way of the voters - wisely and correctly told the retards that extended them way too much credit that they weren't going to repay debts that they could never hope to repay under any circumstances.

Exacty. Should have scrolled down a few more posts before posting. Debts that can't be repaid, won't. The sooner someone sends that message to creditors and bondholders, the better. Actually - I think that some of them are belatedly getting the message, which is why the yield-spreads are spiking in Portugal, Spain, etc, CDS premiums are going through the roof for sovereign debt issued by the same countries, etc, etc, etc.

Greece went under because of debts that originated in the public sector that exceeded their capacity to repay them under any terms, so people stopped loaning them money. Ireland went under because the retards running the show there turned private sector debts that originated in Irish banks and transferred the liabilities for them to the public sector. Since these debts exceed Ireland's capacity to repay them under any terms, people stopped loaning them money. Vastly different paths to the same destination - insolvency. The rest of the PIIGS will end up in the same place. Creditors will have to take massive haircuts (and the sooner, the better), and the four grandparents who are relying on their one-grandchild to fund their collective 120-years worth of inflation-indexed pension payouts and health-care will have to work longer and make do with less once they're done working.

Lazy-guy: I'm glad that growing your own vegetables makes you happy and feel better about yourself. If believing that the unmeasurably sub-trivial impact that doing so has on your personal resource consumption, much less on the planet as a whole, is an important part of the satisfaction that you derive from these behaviors then by all means keep indulging in that too! Don't let someone like me who points out that keeping the temp in your house above 40 for the next 24 hours will probably outweigh a year or more of selfless devotion to minimizing your impact. Ditto for watching TV, running a computer, keeping the lights on after dark, taking hot showers, and pretty much all of the activities beyond bare subsistence that you engage in just as much as the cousin-humping, knuckle-draggers barreling down the highway in their F350 en-route to a Walmart shopping binge. Now I'm off to negate all of your sacrifices by driving myself up to the pass to try out some non-locally sourced, inorganic ski gear. Cheers.

No way jayb, bad data for the points you are striving to make. Franky I'm surprised you linked those 2 studies. I buy into the point that large agribusiness is more efficient than local farms. Your second opinion piece makes the point that the consumer driving to the store and cooking the stuff is the largest energy consumption of the process. Yet why would driving to the store, buying and cooking the product flown over from China or Spain be less consumptive than buying the local product and making the same drive home and the same cooking method? Bad point on his part. I support having more food instead of less and am happy for the modern scale and transportation available for me to enjoy the benefits of. However, that there are a lot of cost associated with the larger farms that are hidden and still picked up by taxpayers is undoubtedly true and the minutia of how bad it is can be debated for eternity as well, yet no one, even big agribusiness, claims that it doesn't exist. The debate is only the extent of it. http://www.cnr.berkeley.edu/~agroeco3/modern_agriculture.html Perhaps I missed these important points in the studies. Where does the Swedish study, for example, say that eating your broccoil (spagetti, coucous etc) out is better than home cooking it? Nor does it compare anything about long supply chain vs local grown? I missed it. Th second study makes the point that a large ship is much more cost effective than a car to the grocery store, but we are all at a loss on how to get a large ship to make regular deposits of small loads of vegetables at our door. In fact that "study" (perhaps we should say "link") in particular, shockingly had even less facts and even more opinions than the usual Pat Galleger egotistically demented loud mouth diarrhea of the mouth blathering on this site. LOL, a rare and unusual thing indeed. For myself, as I live in a wet part of the country and don't drive 50 miles to get fish for use as fertilizer, the tomatoes we grow from seeds is significantly better for the carbon footprint than driving to the store for cardboard taste tomatoes shipped up from Mexico. They get some water during the hot part of summer, but other than us wandering through the patch to pull the odd weed, very little energy is used. We plant them, pick them, eat them. Far as that goes, I walk to the farmers market, and although I can't say what kind of energy costs are utilized in the production, it is much more efficient than me driving to the large box store. Your links do not seem to study this. But regardless, I like the quality and flavor better than large agifarmed products anyway. If you have found an alternative to refrigeration other than a root cellar, please share it. In regards to cooking it, I don't see the savings unless perhaps you are looking at a JR Simplot farmed and processed french fry over a baked potato. However, that wasn't in your studies unless I missed it. Certainly the scale of freezing them at the store has a nice economy of scale to it, but when you buy them in that little frozen bag and bring them home, you have to put them in your freezer. You're saying that this is more economical than growing your own potatoes? Just tossing a few eyes into your back yard and covering them with straw or grass, then coming back months later and tineing them out the potatoes at the end of the growing season with a pitchfork? I can't see how that is. For myself, the brief respite of eating cardboard tasting Tomatoes, of smacking into a juicy, complexly rich and varied taste succulent tomato picked from my garden, give me a rich satisfaction of knowing that it both tastes better, and is better for the world. The point I take away from you your 2 links is to put a lid on the cooking pot and-or pay attention to how you are preparing your food. Duh Woah! This isn't directed at you Bill, but I'll just use your post as an opportunity to make a general response. I'm all for people voting with their hands, feet, and wallet to get whatever kind of food they like to eat, or that provides them with some other source of intangible satisfaction. Totally a matter of personal preference and opinion. Once you leave the realm of personal preference and opinion there just isn't any compelling evidence to support the factual claims that eating locally grown food - using whatever arbitrary boundary defines local - makes any difference at all in terms of environmental impact. There's way more evidence to support the claim that transportation costs represent a relatively small fraction of the total resource inputs required to go from seed to mouth, and the best way to minimize total resource consumption is to buy things made where the comparative advantage is highest and use commercial transport networks to get them to buyers. It requires far fewer resources to to harvest salmon in Alaska and oranges in Florida and ship them across the continent than it would to grow both things locally in each place. There's also quite a bit of evidence to support the claim that agricultural subsidies result in far more waste and needless resource consumption than shipping, and have been far more detrimental to local producers around the globe than any other policy. In practice, "buy local" movements tend to morph seamlessly into subsidies and protectionism, and thereby give rise to outcomes that are infinitely more harmful than shipping food over long distances. Finally - when it comes to consumption, the number one determinant of total resource consumption is wealth. If you're well off enough to shop at say, whole foods - or to own a single-family home with a yard anywhere within the Seattle or Portland Metro areas, where you get your veggies isn't going to have any impact whatsoever on your total resource consumption over the course of your life. The money you save on homegrown lentils will wind up being spent on an airline trip, a flatscreen, a new couch, more climbing gear, etc, etc. By all means - shop and live in a way that reflects your values and preferences. That should be it's own reward and provide you with a great deal of happiness, and will no doubt entitle you to a great deal of satisfaction. It won't entitle you to claim that you're a better person than your neighbor who buys his Iowa grown corn at Safeway because you buy yours at the farmers market, or that you'll actually consume any less resources over the course of your life than he will as a result of how you shop for your groceries.

'Math Lessons for Locavores By STEPHEN BUDIANSKY Published: August 19, 2010 Leesburg, Va. IT’S 42 steps from my back door to the garden that keeps my family supplied nine months of the year with a modest cornucopia of lettuce, beets, spinach, beans, tomatoes, basil, corn, squash, brussels sprouts, the occasional celeriac and, once when I was feeling particularly energetic, a couple of small but undeniable artichokes. You’ll get no argument from me about the pleasures and advantages to the palate and the spirit of eating what’s local, fresh and in season. But the local food movement now threatens to devolve into another one of those self-indulgent — and self-defeating — do-gooder dogmas. Arbitrary rules, without any real scientific basis, are repeated as gospel by “locavores,” celebrity chefs and mainstream environmental organizations. Words like “sustainability” and “food-miles” are thrown around without any clear understanding of the larger picture of energy and land use. The result has been all kinds of absurdities. For instance, it is sinful in New York City to buy a tomato grown in a California field because of the energy spent to truck it across the country; it is virtuous to buy one grown in a lavishly heated greenhouse in, say, the Hudson Valley. The statistics brandished by local-food advocates to support such doctrinaire assertions are always selective, usually misleading and often bogus. This is particularly the case with respect to the energy costs of transporting food. One popular and oft-repeated statistic is that it takes 36 (sometimes it’s 97) calories of fossil fuel energy to bring one calorie of iceberg lettuce from California to the East Coast. That’s an apples and oranges (or maybe apples and rocks) comparison to begin with, because you can’t eat petroleum or burn iceberg lettuce. It is also an almost complete misrepresentation of reality, as those numbers reflect the entire energy cost of producing lettuce from seed to dinner table, not just transportation. Studies have shown that whether it’s grown in California or Maine, or whether it’s organic or conventional, about 5,000 calories of energy go into one pound of lettuce. Given how efficient trains and tractor-trailers are, shipping a head of lettuce across the country actually adds next to nothing to the total energy bill. It takes about a tablespoon of diesel fuel to move one pound of freight 3,000 miles by rail; that works out to about 100 calories of energy. If it goes by truck, it’s about 300 calories, still a negligible amount in the overall picture. (For those checking the calculations at home, these are “large calories,” or kilocalories, the units used for food value.) Overall, transportation accounts for about 14 percent of the total energy consumed by the American food system. Other favorite targets of sustainability advocates include the fertilizers and chemicals used in modern farming. But their share of the food system’s energy use is even lower, about 8 percent. The real energy hog, it turns out, is not industrial agriculture at all, but you and me. Home preparation and storage account for 32 percent of all energy use in our food system, the largest component by far. A single 10-mile round trip by car to the grocery store or the farmers’ market will easily eat up about 14,000 calories of fossil fuel energy. Just running your refrigerator for a week consumes 9,000 calories of energy. That assumes it’s one of the latest high-efficiency models; otherwise, you can double that figure. Cooking and running dishwashers, freezers and second or third refrigerators (more than 25 percent of American households have more than one) all add major hits. Indeed, households make up for 22 percent of all the energy expenditures in the United States. Agriculture, on the other hand, accounts for just 2 percent of our nation’s energy usage; that energy is mainly devoted to running farm machinery and manufacturing fertilizer. In return for that quite modest energy investment, we have fed hundreds of millions of people, liberated tens of millions from backbreaking manual labor and spared hundreds of millions of acres for nature preserves, forests and parks that otherwise would have come under the plow. Don’t forget the astonishing fact that the total land area of American farms remains almost unchanged from a century ago, at a little under a billion acres, even though those farms now feed three times as many Americans and export more than 10 times as much as they did in 1910. The best way to make the most of these truly precious resources of land, favorable climates and human labor is to grow lettuce, oranges, wheat, peppers, bananas, whatever, in the places where they grow best and with the most efficient technologies — and then pay the relatively tiny energy cost to get them to market, as we do with every other commodity in the economy. Sometimes that means growing vegetables in your backyard. Sometimes that means buying vegetables grown in California or Costa Rica. Eating locally grown produce is a fine thing in many ways. But it is not an end in itself, nor is it a virtue in itself. The relative pittance of our energy budget that we spend on modern farming is one of the wisest energy investments we can make, when we honestly look at what it returns to our land, our economy, our environment and our well-being. "

Yeah, we need more big bags of money chasing the few opportunities in the world today! That'll stop bubbles! Actually - the shortage of investment opportunities generating a high-rate of return is far more likely to generate unsound investments than an abundance of them. No shit? Just ask the guys running, say, German pension funds if they'd have been chasing yield in CDO-tranches stuffed with neg-AM, no-doc ARMs if there'd been better options out there that offered the same potential return.

unlike free market circle jerks I realize your ideology is predicated on irrational assertions of fungibility but surely you aren't blind enough to realize their are quantifiable differences between vegetables and foodstuffs and that a realistic like for like comparison suggests there are economic benefits to self production? As it's 5 O'clock somewhere, an example: I could buy many, many cases of Hamms for the money it cost for a homebrew setup and ingredients (number of batches to breakeven ~=10); if I brew a nice Barleywine with the setup the payoff is a couple of batches (n=2.5) Thank god people that brew their own beer don't seem to have the same bizarre compulsion to endlessly solicit applause for all of the higher virtues and larger social benefits that derive from them brewing up a batch of pumpkin-stout in their basement. Saving a bit of money with the home brew/garden, enjoying the process, etc, etc, - sure. Saving the planet - nope.

For some, yes.

Don't forget the medical cartel that funds his family! Indeed. Every single person who works in the health-care industry in any capacity should raise a glass to last year's health care bill for abolishing any hope of introducing price transparency or competition into that sector. I just think those people are overpaid for the contributions they make to society, and it's time to re-examine their union protected salary and pension benefits, and slash those slacker's compensation down to convenience store clerk standards. Then health care will be affordable (though the care perhaps less effective). If it turns out that you can't staff the local fire-departments, for example, without a total comp in excess of 6 figures for a 1st year fireman - then that's what the public should pay. The fact that there are thousands of applicants for every vacancy in good times and bad suggests that the public could pay less without any reduction in the quantity or quality of the services that they deliver. You could then use the money not spent on salaries that are more generous than necessary to attract and retain qualified people on various other public priorities - particularly those targeted towards people who who are way more helpless and vulnerable than your average public sector employee. It's really astonishing to me that this is such a controversial proposition. ------------------------------------------------------------------ 1'm actually *all* for completely liberalizing health care. The irony here is that that price transparency and competition helped keep prices, and by extension, doctor's incomes in check until Uncle Sugar started paying doctor's directly out of his own pocket. Once that started, it was only a matter of time until this very influential constituency engaged in the same sort of self-serving rent-seeking that characterizes pretty much every trade-group's interaction with the government. Now, in addition to retarded soviet-style pricing mechanisms like the RBRVS that make it impossible to coordinate supply and demand, we have panels of doctors that sit together and decide what a "fair and reasonable" payment is for everything that they do. It's no mystery what would happen to grain prices if we had panels of farmers deciding how much the government should pay for barley, corn, and soy based on their subjective assessment of how much their time is worth and the price of fertilizer, tractors, etc. -----------------------------------------------------------------

We (my wife) grow stuff in the yard too - but when you factor in the cost of hauling topsoil to the yard, irrigating with water piped in through a municipal treatment and distribution network, the trips to buy seeds, etc, etc, the process is a gajilliion times more expensive and resource-intensive than the production processes used by even the word's worst production-farmer. Organic or otherwise. Were it otherwise, there'd be no commercial farms. Hell - when we were living in the middle of nowhere in NZ at virtually every meal we were eating produce grown in our backyard, out of a garden that was fertilized by the innards and other non-filet worthy bits of the large wild-trout I was catching...out of gin clear spring-fed water that had been percolating through volcanic layers that had purified it to optical perfection, on single-barbles hooks via flies that I'd tied with my own hands. Locavore perfection. Of course - our plane tickets alone cost a fortune, we burned enough fuel to fuel an African village for years just getting there, I was driving at least 50 miles round-trip to get to the said trout, and I probably spent at least $300 dollars on tying supplies alone - so the entire enterprise behind every "locavore" meal was really a shameless orgy of unnecessary consumption motivated by nothing other than our desire to enjoy life as much as possible before we go to our entropic rewards. All of the dispassionate analysis out there confirms the same for the entire "locavore" phenomenon. Eat local and/or grow your own stuff if that makes you happy. That should be enough. UM...you just don't know how to garden. Make your own compost. Employ low water use techniques. Mail order your seeds. Your objections are based on your shitty practices. NOT HARD. Small family plots have consistently been proven to be the most cost effective environmentally sustainable way, in terms of the inputs required, to produce vegetables. With environmentally unsustainable practices - the factory farming the JayB loves so much, the cost of irreparable topsoil loss, soil/waterway/ocean pollution, health risks, and permanent fossil aquifer depletion will be either a) paid for by future generations or b) paid for by the public sector in subsidies, health services, and environmental mitigation. As with so many conservative darling causes, it's not cheaper - it's just that someone else picks up the tab. This is a form of lying...no surprise there. This is yet one more data point that suggests that the primary things being cultivated in hobby-gardens are narcissism and bizarre conceits about their ecological significance.

My hunch is that a progressive consumption tax would have the same or better public perception-of-fairness going for it, and would do a much better job of promoting savings, investment, production, and long-term productivity/economic growth. It would have to replace the income tax, and would require a constitutional amendment. By its very definition it would be progressive. Unfortunately, it wouldn't serve to sate the class warfare instincts of certain leftist malcontents--like the ones we find here in the form of j_b, Prole et al. Agreed. Even if you could demonstrate that something is objectively superior to the income tax in every category, I think that erstwhile progressives would cling to the income tax for it's cosmic virtues.

The market peaked as a consequence of too many dollars chasing too few sound investment opportunities. The market tanked because people desperate for the kind of returns that sound investments can generate overpaid for crappy investments that could never return enough to justify the prices that "investors" bought them for. The conga-line of retards that got a 10-figure and counting cornholing on real-estate in the PNW alone is a testament to this fact.

you wouldn't have those farm veggies without massive federal subsidies and underpricing of water There'd be plenty - they just wouldn't be grown in the middle of a desert. Ag-subsidies, including irrigation subsidies, have done more to hose local producers around the world than any other single factor.

Don't forget the medical cartel that funds his family! Indeed. Every single person who works in the health-care industry in any capacity should raise a glass to last year's health care bill for abolishing any hope of introducing price transparency or competition into that sector.

Depends on how important the psychological benefits of harboring a delusion that you're consuming fewer resources - and thereby conferring untold economic and environmental benefits on the rest of mankind (who should *really* show you the proper deference and gratitude at whenever you mention your shopping habbits) - is for whoever is doing the math. Dispensing with the ludicrous conceits about the larger benefits of eating backyard veggies, etc didn't make me enjoy my meals any less.

I like it. Nothing more objective than that. If you aren't hashing together the blueprints for Entropos, LLC - the green certifying company to end *all* green-certifying companies right now, you're doing both your bank account and the planet a grave, grave disservice....

Maybe. Are you using real data here or is this idle speculation that supports your point? Just trying to understand how you define what constitutes a local purchase that helps the economy vs a non-local purchase that hurts it.

Yeah, we need more big bags of money chasing the few opportunities in the world today! That'll stop bubbles! Actually - the shortage of investment opportunities generating a high-rate of return is far more likely to generate unsound investments than an abundance of them.