Links 6/17/08

Homosexual brain resembles that of opposite sex: study PhysOrg

Blogger arrests hit record high BBC. I am not certain that this is as meaningful as it seems, since the number of bloggers is also at a record high.

Exposing Bush Administration Corruption Stephen Lendman. I was plenty upset about Clinton corruption too (please, the commodity trading, the sale of the Lincoln bedroom, the list goes on) but they now look like amateurs (hat tip Michael Panzner). The source is a former member of the CIA who was also given a two star general rank as an advisor to the Joint Chiefs of Staff. Some indirect confirmation: Army Overseer Tells of Ouster Over KBR Stir New York Times

Morgan Stanley warns of ‘catastrophic event’ as ECB fights Federal Reserve Ambrose Evans-Pritchard. Telegraph

The April TIC data lends itself to a host of different headlines … Brad Setser

Booming, China Faults U.S. Policy on the Economy New York Times. Good, albeit sobering, piece (although Dean Baker thinks the reporters should have been a bit more tough-minded). Representative quote:

Last month, Liu Mingkang, the chairman of the China Banking Regulatory Commission, delivered a lecture at the British Museum in London in which he blamed the American government for the subprime mortgage crisis that came close to freezing Western debt markets and required extensive intervention by the Federal Reserve. The turmoil, he said, was “counteracting the course of global civilization.”

“Does moneymaking or doing business justify the regulators in ignoring their duty for prudential supervision and their job of preventing misbehavior?” he said.

Re-thinking That ‘70’s Inflation Show Thomas Palley. Key section:

In effect, fighting a price – wage spiral with high interest rates is a form of class based policy that breaks the spiral by undercutting the bargaining power of workers.

Note: Mark Thoma doesn’t necessarily buy it.

Antidote du jour. I don’t normally go for videos, but I liked the sound effects here:

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  1. Greg Byshenk

    This bit from the NYT article struck me:

    This month, the Chinese envoy to the World Trade Organization said in Geneva that the United States had failed to safeguard the value of its currency, worsening the pain for people around the world who pay high oil and food prices in dollars.

    If the people of some state are feeling pain, is it not the fault of their own government, who has, by linking their currency to the falling dollar, thus “failed to safeguard the value of its currency”?

    After all, if the dollar is falling while my economy is healthy, then (ceteris paribus) my currency should be rising against the dollar, meaning that the pain of high prices (in dollars) is mitigated (at least to some extent). The pain of paying high prices comes not because the dollar is falling, but because one’s own currency is following the dollar down.

  2. Richard Kline

    Re: Palley and Thoma on who takes the hit when inflation bites, and Friedman’s ‘natural rate of unemployment,’ I’m wholly in agreement with Palley that the working class takes the hit when high rates are used to wring out inflation.

    I do not agree at all with Thoma’s lengthy discussion because it embeds _so many_ a priori assumptions about ‘when x, then y’ that I literally couldn’t keep count. I’m not accusing Thoma of anything underhanded; he’s making this argument the way it’s made in academia: the result is not a credible argument, to me. There are no historical examples, nothing to give the ideal model traction, and I do not buy many of the embedded assumptions to begin with. A major problem with the _rhetorical_ structure of Thoma’s argument is that it precludes anything which doesn’t fit with it’s conclusions; for example, for example, if wages go up, prices do not necessarily go up, or as much—equity could take a hit on return. Somehow THAT possibility is defined _out_ of the argument. Every assumption in that argument has problems of this kind. It’s possible that Thoma could make a better argument by resorting to examples; the issue is not a simple one.

    I don’t have time to write a long comment on this, which it deserves.

  3. Alex

    Love your blog but please stick to the facts. The conspiracy theory “Exposing Bush Administration Corruption” is the most laughable piece of fiction this side of Atlantic. It is an urban legend which has appeared on every conspiracy and fringe website out there. It is written like a cheap spy novel, contains almost no verifiable facts and at times defies a quick fact check; Simple searches can disprove almost every accusation in there. First of all, Halliburton does not supply military munitions or equipment. It’s just not what they do. They are not a logistics company, they are not a weapons, armor or military supplier. Halliburton also does not really work with CIA. Its former subsidiary, KBR, does do construction, maintenance and service work (like putting fences, repairing electric generators, cooking food, cleaning bathrooms, designing barracks, etc) and has worked extensively with the DoD, DoE and many other government agencies. Government contractors such as SAIC, for example, do work extensively with the CIA and FBI but KBR (formerly HAL) does not and has not, to a great extent, over the last ten years. Also, Halliburton/KBR are not affiliated in any way with CACI which is an independent public company (the ticker is CAI). These facts are easily verifiable.
    The list of factual problems and unsubstantiated claims in the corruption piece are too numerous to count. To touch on a few more… the claim that Cheney is still on the payroll and still controlling Halliburton is particularly counterfactual and is quite easily disputed. Cheney did indeed sell all financial ownership in HAL in 2000. There are no shell companies which own significant portions of HAL or KBR. As these are public companies, the ownership profile can be fairly easily determined by public filings. So can compensation records for management which are detailed in the company’s annual filings. Cheney is not on the payroll and hasn’t been since prior to 2001. No third party corporations are on the payroll either. Coming at it from the other side, all of Cheney’s tax returns are public ( Finally, and most importantly, government contracting has turned out to be a low return, money burning business for KBR. Its decision to shift into military O&M contracting work in 2002 caused it to miss out on upwards of $300 million per year in private sector profits relating the growth in energy and infrastructure investment that began with the commodities boom in late 2003. The operating margin for government work is about 2-4% vs. 7-11% for private sector (a more than 300% profitability gap). The opportunity cost of taking low margin government work has been a significant drag on KBR’s operating performance in recent years and, in 2006, KBR’s management announced a strategy to shift away from government work in favor of private sector energy and chemical projects. This economic reality sadly renders most of this corruption conspiracy theory false.
    Also, far be it from me to be a Bush administration apologist, but if they were so so smart to pull off the millions of devious, ingenious actions “detailed” (I use that word generously) in the conspiracy theory expose, don’t you think they could figure out how not to be the most unpopular administration in history?

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