JayB

Thanks for that clarification, Murray. Makes quite a bit more sense after hearing that it came on the tails of more Canadian soldiers getting killed in combat. I have to say that I don't necessarily agree about the scalability of deaths (e.g. the death of an only child is something different, both in degree and kind, than 1/3 of Europe perishing in the Black Death), but can appreciate relationship between ripples and the size of the pond. I also still feel like there's a degree of sensitivity up there that doesn't make much sense to me in light of the fact that Canadian troops have always distinguished themselves in the fights that Canada has participated in, and the host in question would likely have second thoughts about sharing the said monologue with the male patrons of just about any bar north of the border. Anyhow - I have suspicions that the whole thing is rooted in what folks north of a border is feel is a broad and longstanding mischaracterization of policy choices that Canada embraced somewhere between the end of WWII and the advent of the Trudeau era as "soft, the response to which rises from low-grade annoyance when applied to national policy to outrage when it's festooned upon Canadian soldiers that are fighting and dying on the front lines in a conflict that (I suspect) more than a few Canadians feel they have very little at stake.

--source: The Size of Derivatives Bubble = $190K Per Person on Planet --source: AIG Bonuses Are A Smoke Screen . . . As Derivatives Bubble Grows 22% To $206K Per-Person-On-Planet! I suspect that the value you cite represents the total value of all of the stuff that's covered by derivatives contracts, not the amount of the net uncovered losses associated with them. I think it's important to put the numbers in perspective in order for them to be meaningful. Insurance contracts are very similar to derivatives in many respects, and the total value of all homeowner's policies in the US is probably well into the trillions. Big problem if all of the homes in the US were destroyed all at once - not such a big problem if the losses are small relative to the total value of the assets and reinsurance policies backing up the policies. Most derivatives contracts are used by farmers to protect themselves from risks associated with fluctuations in crop prices, by merchants to protect themselves from currency fluctuations, by appliance manufacturers to protect themselves from increases in the price of steel, etc, etc, etc, etc. Someone is exposed to a given risk based on the change in price of something that they buy, sell, or use - and someone else is willing to bear that risk for a price. Again, very much like an insurance contract, and sold on exchanges that make sure that both parties can and do honor their contracts. As with the example of the value of all of the outstanding home owner's policies not meaning much until the houses covered by the policies are actually destroyed, a derivatives contract giving the buyer the right to buy a billion Canadian dollars at a price that's fixed in US dollars doesn't translate into a billion dollar loss that someone's got to pony up for unless the value of the US dollar drops to 0.000000000001 cents per Canadian dollar. Worth considering when pondering the total value of derivatives out there at the moment. What's the actual value of the net-losses sustained by the party that assumed a given risk in a derivative contract, and how large is it relative to their total assets? The only number that matters (in the current crisis) when it comes to derivatives is the dollar value of the liabilities that banks or other institutions that wrote over the counter (non exchange traded) derivative contracts can't honor. E.g. AIG said they'd give the ACME co $1 million dollars if the a pool of assets declined in value - and AIG doesn't have the money. That million dollars is now a number that matters, since the ACME co needs that money or they'll go out of business. Still a big scary number, but nowhere near the total value of all outstanding derivative contracts. Many quadrillions or pentillions of exchange-traded derivatives contracts have been initiated and satisfied and the system used to buy and sell them has worked well for all concerned. The derivatives contracts that are responsible for all of the uncovered losses were sold outside of exchanges. Making that one simple improvement to the rules that govern derivatives and that'd be sufficient to prevent a recurrence of the present crisis. Do that - and revise the rules that govern the origination and securitization of debt - and that's virtually all of the "change" that'd be necessary to keep excessive leverage from derailing the economy again in the future. Having said all of that - it's not surprising that the crisis brought about by excessive leverage have inspired despite calls to re-introduce government price controls and government-run or sanctioned monopolies on wide swaths of the economy in response to the current crisis, and reduce or eliminate restrictions on trade (this is what most of the deregulation efforts from the Carter administration onward actually did). I suspect that what I posted about derivatives is a low-level rehash of a small portion of what you know about derivatives, but I thought it was worth sharing during the current populist - er - "moment."

so what, if anything, can be done to achieve a critical mass and stop this insanity? reagan's drug war is soon to enter its 3rd decade. why isn't there more international pressure? why don't the mexican and columbian governments in particuliar scream out against it? The original prohibition movement morphed out of the "Progressive" crusade for temperance, etc, so I'd say that the first step is recognizing that both the left and the right have succumbed to the siren song of using the state as a means to impose their principles on society by force. I think that when and if drug-prohibition ever gets rolled back it'll be when a coalition of odd bedfellows decide that they can advance their particular agenda in some small way by latching onto this crusade. Seems like there's enough to dislike about the current state of affairs to keep quite a few groups engaged enough to momentarily distract them from their distaste for one another.

I will have you know that I've often felt acute pangs of remorse every time I've contemplated the fate of legions of all of the above, having sullied their enjoyment of their elevated principles with my bitter tincture of petty criticism and ridicule. I'll have you know, however, that I have found comfort in the realization that my small minded mockery of such high ideals in action is nothing that can't be overcome by a strong dose of certified life-coaching and/or a bracing round of hatha yoga.

The death toll in Mexico alone is appalling. Unfortunately, even if drugs were legalized tomorrow, the effect of drug-prohibition fueled corruption on their society would last for a generation, at minimum. Given that alcohol Prohibition in this country is universally acknowledged to have spawned massive corruption, widespread organized crime, and an upsurge in violence, it's hard to understand why our long experiment with drug prohibition hasn't at least spawned a bit of reflection. Seems like an issue that folks of a certain bent on both the left and the right could potentially rally around. Unfortunately - the prospect of using the state as the means of enforcing compliance with a particular vision of how everyone should live has proven too tantalizing for a majority on either side to sincerely embrace limitations on government that would check their own hands when they've got them on the levers or power.

Art: http://www.southparkstudios.com/guide/1002 Life: [video:youtube]7Eh4jpSNn-Q

Car hipper than a Prius? Surely you jest. Given that the compulsive embrace of irony as a signifier of hippness was extreme and entrenched enough to make large swaths of young-Portland embrace PBR as their beer of choice by 2002, it's possible that anything from Duster's to Firebirds might have displaced the Prius as the Hippest-of-All-Vehicles, but I suspect that there are limits to irono-chic, even for hipsters. Maybe if someone came out with a car that had only one (fixed) gear, the Prius's stature in the hierarchy-o-hipness might be in jeopardy, but until then...

Seems to have struck a nerve, no? Care to explain why? The reason that I'm asking is that it's hard for me to understand why Canadians who are even vaguely familiar with their history (Ypres, Juno, etc [these should ring a bell or two]) would be so easy to provoke with taunts of this kind. I love Canada, and Canadians are great - but I have to confess that I can rarely resist the temptation to engage in a bit of "provoke the Canadian" from time to time, just because it's so damned easy. My personal favorite is giving a quizzical glance when a couple that I run into somewhere outside of that fair country makes it a point to announce that that they're Canadian, at which point I follow the bemused look with the following line - "Canadian?! *Really*?! You just seemed so ...American." Anyone who doubts the persistence of the martial spirit amongst Canadians need only give that routine a try when the opportunity avails itself and they'll quickly be disabused of any such notion!

Unless someone comes up with a way to eliminate greed from human nature, I'd be much happier if legislation enacted in response to this crisis contented itself with devising and strengthening mechanisms to constrain its worst effects in a way that preserves essential rights and liberties instead of attempting to remodel the human psyche. Since most transactions involve a buyer and a seller, one of the most effective ways to combat greed it to put rules in place that use one guy's desire to avoid getting cheated as a check on the other guy's desire to cheat him. Little things like placing the onus for making the buyers of bonds responsible for having a bond issue rated instead of the sellers, and a million other little tweaks to the rules that govern transactions are a very effective way to do so, and constitute a legitimate and essential role for government. This and many other minor tweaks would make it much tougher for the douche with NINJA status to use an uber-douche in NYC as an intermediary to sell a stake in the debt that he used to shoehorn himself into a McMansion to a dupe representing a German pension fund who took one look at the plot of fertility versus pension obligations in Deutschland, slugged down a pentuple dose of prozac with a stein full of Jager, and went on a desperate hunt for yield all over the globe. I'd agree that the ultimate blame for this cluster, while complex, ultimately lies with the people writing the rules and the people lending the money. However - there's plenty of blame to go around, and you'd be remiss if you didn't spare a large helping for everyone you know who borrowed beyond their means to buy a home/car/boat/etc - which I imagine includes quite a few people that you know and like, and no small numbers of your neighbors. At the end of the day - no one forced our personal-debt-to-GDP ratio to $100% (hovered at 30-50% for most of the century, last hit its present level of 100% in 1929) except us. I'd also suggest that this phenomenon is hardly constrained to Americans. Run the metrics on residential properties in Vancouver, BC for example, and I suspect that you'll see home-price-to-gross-household-income metrics that are every bit as bad as most of the worst bubble markets in the US, if not worse. Ditto for large swaths of Europe, NZ, Australia, vacation hotspots around the world, and quite a bit of Asia outside of Japan. I can tell you that the above ratio is currently 3.2 for the US, but sits at 5.7 and 6.2 for NZ and Australia, respectively. Look out below.

Don't have much time to add anything to this thread other than to confess to having just had a moment of head shaking and rapid blinking upon having found myself in broad agreement with many statements put forth by both Tvash and JosephH in a single thread - and to recommend that anyone who has an interest in the bank implosion listen to the "This American Life" episode entitled "Bad Bank" that came out last week. I also think that on a long-term basis we'd be much better off if our policymakers put their emphasis on dramatically improving the rules that govern how all debt is originated and securitized, and spent less time pondering how to fundamentally restructure the mechanisms that govern large swaths of the economy and placing the government at their center as a participant rather than a neutral rule-maker/enforcer. And - while I wish Obama the best and think that it'd be insane to expect him or any other president to have made much headway on a crisis of this magnitude - I do think it's fair to criticize his response in terms of the message that his budget and his policy biases (inasmuch as their evident so far) are sending about the future. Expectations about the future establish economic incentives that have enormous impacts on the decisions that people make in the present. If you are fortunate enough to have capital to invest at this point, and are attempting to decide where to do so, it's hard to imagine that the prospect of the "Employee Free Choice Act" will tip the ledger in America's favor.

almost no taxation, rule of law, it follows from Milton Friedman that this would be a socially liberal paradise right? Oh, wait, it was for tax cheating europeans, Indian criminals and oil money Compared to its neighbors, it certainly looks like one. I think that the argument was that political and economic liberties are mutually reinforcing and the latter can act as an essential check on state power - not that Lubbock Texas and Venice Beach will have the same social attitudes because the citizens there have the same economic rights.

Since we're on the subject of homeopathy, I'm reminded of a joke I heard not long ago: "Did you hear about the guy who OD'd on his homeopathic remedy and died?" "Seriously!? What happened?" "He forgot to take it." DeC: Not sure what angle that you are coming at this from, but what do you think of homeopaths who sell patients homeopathic remedies for malaria prevention (this actually happened in England a year or two ago)? Even if they sincerely believe that their remedy will work, do you think that this belief is defensible on the basis of the best evidence available to us, and/or that their actions are ethical? What would you think of a pharmaceutical company that sold anti-malarial medications which had the same amount of empirical evidence to support their safety and efficacy?

[video:youtube]

"Driven down by debt, Dubai expats give new meaning to long-stay car park For many expatriate workers in Dubai it was the ultimate symbol of their tax-free wealth: a luxurious car that few could have afforded on the money they earned at home. Now, faced with crippling debts as a result of their high living and Dubai’s fading fortunes, many expatriates are abandoning their cars at the airport and fleeing home rather than risk jail for defaulting on loans. Police have found more than 3,000 cars outside Dubai’s international airport in recent months. Most of the cars – four-wheel drives, saloons and “a few” Mercedes – had keys left in the ignition. Some had used-to-the-limit credit cards in the glove box. Others had notes of apology attached to the windscreen. “Every day we find more and more cars,” said one senior airport security official, who did not want to be named. “Christmas was the worst – we found more than two dozen on a single day.” When the market collapsed and the emirate’s once-booming economy started to slow down, many expatriates were left owning several homes and unable to pay the mortgages without credit. “There were a lot of people living the high life, investing in real estate and a lifestyle they couldn’t afford,” one senior banker said. Under Sharia, which prevails in Dubai, the punishment for defaulting on a debt is severe. Bouncing a check, for example, is punishable with jail. Those who flee the emirate are known as skips. The abandoned cars underscore a worrying trend. Five years ago the Emir, Sheikh Mohammed bin Rashid Al Maktoum, embarked on an ambitious plan to transform Dubai into a hub for business and tourism. A building boom fuelled double-digit growth, with thousands of Westerners arriving every day, eager to cash in on the emirate’s promise of easy living and wealth. Many Westerners invested in Dubai’s skyrocketing real estate market, buying and reselling homes before building was even complete. But, as the recession took effect, property and financial companies made thousands of workers redundant and banks tightened lending. Construction companies have delayed or cancelled projects and tourism is slowing. There are increasing signs that the foreigners who once flocked to Dubai are leaving. “There is no way of tracking actual numbers, but the anecdotal evidence is overwhelming. Dubai is emptying out,” said a Western diplomat. International schools are having to be flexible on fees as expatriate parents run out of cash. Louise, a single mother from Britain, said that her son’s school had allowed her to pay a partial fee until she found a new job after her redundancy in December. “According to the headmaster, a lot of people had come into the school saying they had lost their jobs so the school was trying to be a bit more flexible,” she said. Most of the emirate’s banks are not affiliated with British financial institutions, so those who flee do not have to worry about creditors. Their abandoned cars are eventually sold off by the banks at weekly auctions. Those recently advertised include BMWs, Porsches and Mercedes. Simon Goldsmith, a spokesman for the British Embassy in Dubai, said that that there were approximately 100,000 Britons living in Dubai last year. However, the embassy has no way of tracking how many have fled back to the UK. “We’ve heard stories, but when somebody makes that kind of decision, they generally keep it to themselves,” he said. Police have issued warrants against owners of the deserted cars. Those who return risk arrest at the airport." http://business.timesonline.co.uk/tol/business/markets/the_gulf/article5663618.ece

It still warrants serious consideration (for you) in light of the fact that in the very states that are either unwilling or unable to hand over the guys that the US wants are quite unlikely to have much formal recognition or consideration for their human rights en route to the airplane? We're not likely to have the luxury of knocking on doors with a "thoroughly vetted" warrant in one hand an a badge in the other in the tribal areas, or anywhere else that terrorists tend to congregate these days. That's in the event that it's us that do the knocking, and not some bought-off local drug-lord's thugs who'll "secure" the guy in exchange for cash and/or weaponry, etc.

I think that there's no question that torturing terrorists in order to secure information that may help spare innocent lives is orders of magnitude more moral than airstrikes that kill both the terrorists and anyone around them. However, it's clear that airstrikes are more palatable to the average persons sensibilities on a number of levels, and it's much better politics to disavow torture loudly while maintaining special exceptions that will come into play in practice when the stakes are high enough, and discretely (as possible) kill as many terrorists as you can with whatever means you have at your disposal in the meantime, while striving to minimize civilian deaths but not letting it paralyze your offense. As conducted under Bush, the political/strategic damage stemming from their approach to these matters ("enhanced interrogations", Guantanamo, etc) probably resulted in more strategic damage than the tactical gains that any info derived from torture/exceptional interrogation, etc generated. Obama is smart change the PR facade while retaining the capacity to engage in much the same practices if necessity forces him to. Ultimately neither airstrikes or torture can ever be considered "moral" in any abstract sense, but we don't live in an ideal world, and morality - in practice - often comes down to choosing the least immoral alternative. Even in cases - as with carpet bombing German cities, or firebombing Japan, which are at least at reprehensible as anything that they could have thrown at us - physical equivalence doesn't render all actors morally equivalent to one another. Neither action made us as bad as the folks that we were fighting who wanted to turn the parts of the world that they controlled into ethnically cleansed totalitarian slave-kingdoms, and if Obama ever exercises the exceptions necessary to engage in "extraordinary interrogations" in order to prevent the likes of Al Queda or one of their franshisees from fulfilling one of their jihad fantasies via the death of as many people as they can kill at once - that certainly won't render us their moral equivalents either.

There's a reference to Appendix M in the Army Field Manual here: More Confusion on Renditions: The Role of Ostensibly Liberal Bloggers Great link. I'd probably disagree with the guy on many things, but it's refreshing to see someone who hasn't changed his tune simply because he likes the new director better than the old one. I suspect that he will incur no small amount of wrath from his erstwhile fellow-travelers for calling them on this one.

Serious question: What about people who approved air-strikes or other military actions in which civilians were killed alongside the intended targets, and knew that this would be unavoidable? Is execution by JDAM or guided missile with no trial or legal safeguards whatsoever, much less of innocent bystanders, not a much graver ethical transgression than water-boarding Khalid Sheikh Mohammad et al? Just trying to figure out where and how you draw the line.

Ya, I agree with you to a point. I've read some of that stuff before. I just don't believe the ideology is confined to the Republicans. It follows the power shift. Do you get what I'm saying? You've done an admirable job of calling people on this one, but don't expect much in the way of public concessions of your points, since doing so would require making - at the very least - a tacit admission of the extent to which their previous statements on these matters where driven by political opportunism masquerading as principled opposition.

I am pretty sure that the "extraordinary methods" that you are referring to here would be classified as torture if the standards applied to the Bush administration are applied to the Obama administration with the same rigor. So, if we have a formal set of rules vetted in open daylight that state when, exactly, the president can order that a known terrorist can be tortured in order to extract the necessary information - we're still engaging in torture, no? Finding a way to make it legal suddenly makes it moral? The folks who were cringing and gnashing their teeth over a Koran in the toilet are now suddenly cool with torture as long as there's "a vetted legal and Constitutional basis for the use of any extraordinary methods which in turn would need to be authorized on a case-by-case basis by him personally"? Can't recall anyone saying, "Gee - I'd be totally cool with torture as long as there's a legal framework in place and it's personally approved by the president" when Bush was in office. I'm saying all of this as someone who thinks that Obama has made the right rhetorical, political, and legal moves by closing Guantanamo, etc.

"Beginning in 2002, Nancy Pelosi and other key Democrats (as well as Republicans) on the House and Senate Intelligence Committees were thoroughly, and repeatedly, briefed on the CIA's covert antiterror interrogation programs. They did nothing to stop such activities, when they weren't fully sanctioning them. If they now decide the tactics they heard about then amount to abuse, then by their own logic they themselves are complicit. Let's review the history the political class would prefer to forget. According to our sources and media reports we've corroborated, the classified briefings began in the spring of 2002 and dealt with the interrogation of Abu Zubaydah, a high-value al Qaeda operative captured in Pakistan. In succeeding months and years, more than 30 Congressional sessions were specifically devoted to the interrogation program and its methods, including waterboarding and other aggressive techniques designed to squeeze intelligence out of hardened detainees like Zubaydah." Etc. http://online.wsj.com/article/SB123120464870255997.html

Always impressed by the drive, the perma-stoke, and the positive outlook. Thanks for sharing.

Easy there Baron Von Munchausen - your friend is in no peril, real or imagined, that you need to charge in and save him from. Ditto for any non-existent slight that you feel compelled to rectify on his behalf.

Oh come on now, the hombre doth protest too much methinks. You resemble a man who puts principle above politics about as closely as Mike Ditka in a little black dress resembles Audrey Hepburn. To paraphrase Churchill a bit: we both know what you are, we're just quibbling about the label.

funny - whenever i hear anyone talking about anythign i wish they'd STFU and read "the stranger" Wishing for a CP Snow Quote from the above work, were you? Here you go: "A good many times I have been present at gatherings of people who, by the standards of the traditional culture, are thought highly educated and who have with considerable gusto been expressing their incredulity at the illiteracy of scientists. Once or twice I have been provoked and have asked the company how many of them could describe the Second Law of Thermodynamics. The response was cold: it was also negative. Yet I was asking something which is the scientific equivalent of: Have you read a work of Shakespeare's? I now believe that if I had asked an even simpler question — such as, What do you mean by mass, or acceleration, which is the scientific equivalent of saying, Can you read? — not more than one in ten of the highly educated would have felt that I was speaking the same language. So the great edifice of modern physics goes up, and the majority of the cleverest people in the western world have about as much insight into it as their neolithic ancestors would have had."