Links 8/6/09

‘Slaughter’ fear over poaching rise BBC. This time it’s elephants

Decline & Fall of America: JP Morgan Fleeces Alabama Hicks With “Shit Bonds,” National Guard Called In Mark Ames (hat tip reader Joe C). My mother lives in Jefferson County, and the only reason I can fathom why the county has not defaulted or declared bankruptcy is the resulting litigation would expose not just incompetence but fraud on behalf of the officials involved.

America needs a single bank regulator Mark Werner, Financial Times

White House Affirms Deal on Drug Cost New York Times (hat tip DoctoRx). Health care reform is dead on arrival. If the US is not going to push for lower drug prices, what is the point?

Where Did Manufacturing Go? Steve Ellison

Hank Greenberg Said to Face SEC Lawsuit After Role as AIG Chief Bloomberg. Couldn’t happen to a nicer guy. It increasingly appears that AIG had a serious shell game going at the subsidiary level.

Rosenberg Estimates Consumer Spending Could Have Declined 10% Annualized Without Stimulus Tyler Durden

“Did Welfare Reform Work for Everyone?” Mark Thioma

Goldman Sachs admits it’s under government investigation Raw Story (hat tip reader John D)

‘Underwater’ Mortgages to Hit 48%, Deutsche Bank Says Bloomberg (hat tip reader Michael D) and About half of U.S. mortgages seen underwater by 2011 Reuters (hat tip reader John D)

For Today’s Graduate, Just One Word: Statistics New York Times, I could be wrong, but I suspect Taleb would regard this as a bad thing, Being able to integrate quantitative and qualitative analysis is a key skill, and it seems to be increasingly devalued.

You Do Not Have Health Insurance James Kwak, Today’s must read.

Antidote du jour:

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  1. Richard Kline

    Yves: "If the US is not going to push for lower drug prices, what is the point?" To guarantee large public payments to existing players in the American health scam principally but not limited to the insurance and pharmaceutical rings. Seriously, if you read Obama's plans _in 08_ it was clear that he was going to push for public subsidy of these colossal pigs. Single payer was and is the only way to go for the public interest, and he has never been for it. What we are going to get is guaranteed public overpayment to parasites with little or no improvement in service delivery to the public and no cost controls at all. The worst of all possible worlds.

    I've thought that BO was a bought man for a long time. The further this steal advances, the more profound the confirmation. I'm not quite sure what year the country I grew up in died; 1994, 1998, 2004, 2007. But its dead history now. I live in a failed state run by and for a tiny handful. I wonder how much of the 21st century it will take us to get back to a 20th century democracy?

  2. Anonymous

    I like the antidote du jour, it is a little brightener of our day and also reminds you that there does in fact exist a world outside the 4 walls of whatever financial institution you are sitting in. Not sure how two helpless bovines dressed up like clowns and tied to eachother with a stick fit into that though. Chalk this one up as a miss Yves. Well done for human interest stuff generally.

  3. Richard Kline

    Bovine A: "The things you have to do to get a decent meal around this place."

    Bovine B: "If I didn't look pretty in pink, I'd take this amiss, but chin up old son."

  4. LeeAnne

    A good article but I missed some mention of the exceptions to You Do Not Have Health Insurance

    " …If, like most people, your health coverage is through your employer or your spouse’s employer, that is not what you have [health insurance]. At some point in the future, you will get sick and need expensive health care. What are some of the things that could happen between now and then? … For all of these reasons, you can’t count on your health insurer being there when you need it. That’s not insurance; that’s employer-subsidized health care for the duration of your employment."

    Just how long does a US Senator or Congressman serve before being entitled to 'lifetime' benefits. The following link doesn't answer that question, but it's good for starters: Health Care of U.S. Congress: Politicians Receive the Country's Best Care – at Taxpayers' Expense

    When speaking about 'health care rationing,' remember that every 'enhanced' plan paid for by taxpayers for government employees and elected officials reduces the number of health care professionals, equipment and services available to the very people paying the bills.

    Add to that the negative influence of 'the rich' against improving income and health security for the majority of Americans, the one-third top income elites receiving in excess of 500 times the salary of those on the lowest rung of the Corporatocracy, the largest income gap in the world, adds a formidable barrier to anything like a health care insurance public option that can be labeled 'socialism.' (not to mention the 'socialist' safety net for the finance industry) Corporations benefit by providing health care for employees; employees would be better off with a health care insurance public option. They could then freely plan their careers and job changes.

    Notice the 'socialism' meme of the Corporatocracy/Republican strategy of intimidation against speakers at town hall gatherings on health care legislation. These people screaming who need someone to blame for their economic insecurities are easy marks for this kind of rationale: that 'socialism' such as the legislation now being debated, the 'public health care insurance option' is the cause of their problems with government.

    An article on GS health plans costing $40,000/yr per family member points out the extent to which the insulation of the very rich from the irritations of the bureaucratic private health care system acts as a passive barrier to the urgent need of health care reform for the rest of us. "Since top executives often are disproportionately influential members of the "superclass," …' their disconnection from the realities of dysfunctional health care is likely to translate into little real support by the powers that be for meaningful health care reform. Their support may be further retarded by the influence of their fellow superclass members whose personal fortunes depend on the status quo in health care."

    Finally, this article, ending with the sentence "Real improvement of health care may depend on finding leaders who have better understanding of the plight of real people" conjures up an image of people lying on the pavement waiting for help pinned under the car wreck of their private health care insurance as the limousine ambulances speed by.

  5. Anonymous

    re: Health care is dead on arrival.

    I say, AMEN!!! These people couldn't run a bake sale, much less a taxpayer ripoff like this health care boondoggle.

  6. David Habakkuk

    '''We’re rapidly entering a world where everything can be monitored and measured,'' said Erik Brynjolfsson, an economist and director of the Massachusetts Institute of Technology's Center for Digital Business. ''But the big problem is going to be the ability of humans to use, analyze and make sense of the data.''

    Everything? What about, for instance, the rather critical question of how far recruits to the Afghan National Police have any genuine commitment to the idea of an Afghan nation — as distinct from family, clan or tribe? Insofar as that can be 'monitored and measured', it is not by the tools of statistics.

    But if American strategists get the answer wrong, and base their strategy to win the war in Afghanistan on quite unrealistic expectations of about possibilities of creating 'national' institutions, then the U.S. is going to go down to a painful and humiliating defeat in that country.

    A very astute former Brigadier in the Pakistani Army, F.B. Ali, said what he thought on the matter in a comment on the blog run by the former head of Middle East intelligence in the Defense Intelligence Agency, Colonel W. Patrick Lang. Commenting on the views of U.S. 'experts' on Afghanistan, as reported by the journalist Richard Sale, Brigadier Ali wrote:

    "This would be comical if it weren’t so damn tragic!

    "All these experts and leaders that Richard Sale quotes seem to believe that all that needs to be done to fix the ANP is reorganization, leadership, training, etc. Which world do they live in?

    "The average ANP guy is an illiterate youth from the poorest strata of society, whose family paid a bribe to get him enrolled so that he could earn a living and, hopefully, alleviate their hardship. He doesn’t have any concept of state or country (very few Afghans have), or law and order, or service to the people. All he's interested in is to survive and make some money for himself and his family (after paying the cut his superiors up the chain of command demand). He isn’t in the least interested in 'holding and building', or fighting the ferocious Taliban. It isn't going to be any different in 2014.

    "To see this huge, powerful country led down this garden path by idiots and conmen — it's downright pathetic!"


    It seems from the NYT article that little has been learnt in the U.S. about the limitations of quantitative analysis since Robert McNamara applied it to the conflict in Vietnam, ensuring a catastrophic defeat, all those years ago.

  7. "DoctoRx"

    Dr. Kwak's "must read" of the day approvingly quotes Dr. Krugman, who argues for (increased) "subsidies" for health insurance. Both as a physician and a patient, I'm selfishly all for health subsidies. But subsidies should be balanced with punitive taxes. The "good" of health insurance if subsidized (as it is now) must be balanced by taxes on sugary and fatty foods, polluting depleting materials such as oil, etc.

    Absent the "courage" to balance a subsidy with a tax, then perhaps the US should put in a catastrophic health care insurance policy that would be hard even for Repubs to oppose and leave the heavier lifting for better economic times.

    None of these issues exists in isolation, just as "cash for clunkers" draws sales from apparel retailers and from mechanics who fix old cars.

  8. kjmclark

    Um, those of you concerned about the yaks should check the name of the file. Checking properties for the file, I get a filename of: In_Tibet,_yaks_are_decorated_and_honored_by_the_families_they_are_part_of.jpg

  9. Hugh

    For me, the big story of the day, the week, the year is that half of US homeowners are going to be upside down in their mortgages by 2011. I can not state strongly enough that this is a strong indication that depression has not been averted but delayed. There is a tremendous kaboom in the offing and I quite simply do not see our elites up to the task of seeing it, avoiding it, or having the least clue in how to deal with it.

  10. Anonymous

    completely agree with hugh. housing, mortgages, defaults, unemployment etc. perhaps another crash is incoming.

  11. run75441


    "Everything? What about, for instance, the rather critical question of how far recruits to the Afghan National Police have any genuine commitment to the idea of an Afghan nation — as distinct from family, clan or tribe? Insofar as that can be 'monitored and measured', it is not by the tools of statistics."

    Yes that can be measured also from the data collected over a period of time. It just becomes another X variable in multiple linear regression analysis. It can be measured relatively accurately with a high measure of confidence. Datafit can do it if we have a history of data.

    It is not a matter of expertise, it is a matter of understanding the data and whether it is valid or not and not skewed to preference or influence which is what you are really arguing. Vietnam data, as this USMC veteran would tell you, was skewed to suit the administration's need to placate the public.

  12. run75441


    You hit the nail on the head with this:
    "The 'good' of health insurance if subsidized (as it is now) must be balanced by taxes on sugary and fatty foods, polluting depleting materials such as oil, etc."

    Anyone who has bothered to look at the 2006 Department of Health report on the 15 drivers of healthcare costs would come away with a similar understanding of what needs to be done. Salt and Fat are the tobacco of the next 20 years.

  13. jlivesey

    I come from a country with universal health care, and I am well aware of its advantages, especially for the lower-paid and for the self-employed.

    However, if you look at the big picture of the US economy – and I mean the Very Big picture, stretching over several decades – what do you see?

    I see the American worker, writ large, paying him or herself too much for doing jobs that can be done far cheaper elsewhere, while simultaneously voting for more and more generous social benefits, and until recently, all the cheap credit a consumer could desire.

    Now forget the undoubted benefits of universal health care – and they are real – and instead ask yourself what universal health care means in the overall economic picture.

    I think it means that an economy that already pays itself too much will lose yet another slice of competitiveness in the world market.

    What's more, I think it means taking a society that can already consume consumer goods more or less without limit thanks to cheap credit, and adding to it the ability to consume medical services, again without limit.

    I think it is a real tragedy that the US did not introduce universal health care when it was the richest and most productive economy in the world, but is today really the moment to follow the Europeans, ignore our loss of competitiveness, and attempt to win through legislation what we are not capable of generating through productive work?

  14. run75441


    "I see the American worker, writ large, paying him or herself too much for doing jobs"

    Ok, I'll bite. How does the American worker pay themselves too much for doing prescribed work?

  15. David Habakkuk


    'Yes that can be measured also from the data collected over a period of time.'

    But precisely what is at issue is what forms of 'data' can be obtained on the attitudes of the kind of people who are recruited by the Afghan National Police, and how one can collect and process it — and how accurate an understanding one can expect as a result.

    Even in 'developed' countries, while people while sometimes are candid about what they think with strangers conducting surveys, they not uncommonly do not say the kind of things they would say to people close to them — particularly when they expect that their actual attitudes will meet with disapproval.

    As a result survey data can sometimes be a highly accurate predictor of how people will behave, and at other times a wildly misleading one. The British Labour Party believed opinion polls which seemed to show that electors were unselfish people, prepared to pay higher taxes for better public services, and proposed tax rises to fund better pensions and child benefit. As a result they went down to catastrophic defeat in the 1992 election.

    Where — as in the Afghan situation — there are deep linguistic and cultural barriers between those designing and conducting surveys, and those being surveyed, the problems are liable to be far worse.

    While survey data has its uses, it simply cannot be a replacement for the kind of very detailed knowledge of how people talk and act which anthropologists acquire through fieldwork — and which good journalists acquire by extensive familiarity with the people on whom they are reporting.

    The kind of data such researches provide are not, commonly, susceptible of being fed into a computer. Moreover, much contemporary education — particularly that given in economics and politics science departments — tends actively to shrivel certain intellectual faculties on which this kind of understanding depends: notably that of imagination.

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