Links 11/15/09

TSA is secretly watching you LA Times (hat tip DoctoRx)

An Old West Crime Makes a Big Comeback NBC Dallas-Fort Worth (hat tip reader John D)

Cryptographic voting debuts MIT News (hat tip reader John D)

Manhattan Institute Says “New York must declare a financial emergency” Michael Shedlock

Medical workers balk at mandatory flu vaccines Reuters

Krugman Misses the Point about Kurzarbeit Peter Dorman. This is short and VERY important.

U.S. watchdog: Need way to unwind troubled firms Reuters. I’m a big Warren fan, but this is a motherhood and pie statement that is unworkable, at least as she is framing it. The idea for having a resolution is that that is presumed to be (as she states) a way to avoid forcing the firms to downsize. This is just incorrect.

There is no way a resolution authority can operate absent massive structural changes in the financial services industry. The firms are too interconnected. The network is the computer. The debt markets are now an integral part of the credit process, which is turn is essential to modern capitalism, and hence cannot be permitted to fail. Why is this so hard to understand? This fantasy plays into the industry’s hands.

How do you resolve a Citigroup, with $500 billion in unsecured foreign deposits? You either backstop those (politically unacceptable in the US after letting IndyMac, etc. unsecured depositors take big losses) or you let them suffer, which means other foreign banks are likely to see withdrawals of their unsecured deposits. Or how do you resolve a Lehman, with a massive London operation, over 100 corporate entities around the globe, and derivatives books that were a complete mess? And you have the further political and practical problem that Uncle Sam has to fund their balance sheets as they are being wound down (the same issue came up with the RTC, which required some $50 billion of working capital funding from Congress).

Antidote du jour (hat tip DoctoRx, via the LA Times):

A white-handed gibbon from the Sao Paulo Zoo Foundation eats monkey-friendly ice cream — a frozen fruit wedge on a string. Temperatures rose to 86 degrees Fahrenheit this week in Sao Paulo, Brazil, and the zoo fed its gibbons and black-faced spider monkeys these frozen treats for sweet relief.

Print Friendly, PDF & Email


  1. attempter

    The Dorman piece on Krugman is revelatory. It’s another example of how advanced the rot is in America, that even members of the system who remain basically decent human beings tend to still be mired in the intellectual pathologies of that structurally criminal system.

  2. mechanic

    James K. Galbraith
    Harper’s Magazine, November 2008.

    ” The problem is not how to save capitalism but how to save the unique and successful mixed economy built in the US over the eighty five years since the new deal. Our system is not capitalism. Our economy has a large public sector, which at it’s best, was competently concerened with research, defense, financial stability, environmental safety, social security, and large measures of education, health care, and housing. Today, after thirty years of attack on government, all these functions are damaged and in peril.

    “The rot comes from predators posing as conservatives and mouthing the rhetoric of “free markets”. They are not actually interested in free markets. Their goal is to use the government to build monopolies, to control resources, to block regulation, to crush unions, to divert as much as possible from taxpayers into private pockets. They have a reckless attitude toward war making and they put the financial system in peril by failing to enforce standards of ethics and transparency. “

  3. Richard Kline

    This is very much a class issue in the US. Here, if you don’t have a college degree (three-quarters of the population), you’re considered a replacable idiot, paradoxcially because we value formal education more highly than many societies. Credentialling is endemic to ‘simulate’ learning and skills. But for those ‘sans diplomas’ they are tacitly treated like chumps. Management, too often functionally incompetent even at their own jobs let alone yours, sneers the face of labor. The media and the Beltway class have written off 90% of the citizenry; you can tell that by their _advertisements_, let alone their policies. —And because labor has bought the meme that they’re dim idjits they just sit their gulping and shuffling their feet. Sad.

    1. IF

      The college degree issue sounds like a red herring, as Germans also value papers with fancy titles a lot (even more than in the US). But changing jobs is not as easy as in the US and more stigmatized. The company provides to the workers. This has been an idea from the 1870s, when the red Bosch, Zeiss etc. created foundations to take care of the communities their workers lived in. Did Ford do that? I realize Microsoft and Google also have foundations, but their focus is different (global). Maybe some of the HP foundation work is similar. (With the difference that the company HP is not owned by the foundation, as Bosch is.) But then again many large German companies are public.

      One thing that seems different as well is the goal of “profit maximization”. Coming from the East I assumed this was one of the goals of companies in capitalism. But even the most staunch west German economic libertarians hated that word, as they understood “profit maximization” to be self destructive, via its negative feedback loops in society. They preferred a more holistic way of defining good corporate citizens. Again, I was more of an outsider and I don’t understand where exactly this comes from, but it is deep inside of German societies thinking/social contract. And decisions like Kurzarbeit follow from there.

  4. i on the ball patriot

    The Warren US Watchdog article is a sham. Its all couched in deflective Orwellian bullshit eye rolling financial speak — oh its sooooooooo complicated — that masks the corruption but makes you believe that something will be done!

    This is exactly like trying to understand fartonomics, the science of painting farts. Its all so far beyond the common person’s ability to understand …

    In order to get the paint to adhere to the individual fart molecules you have to know something about the infinitely complicated dynamics involved of not only the motion of the fart and paint molecules themselves, but also any other molecules that might exist within the farts sphere of influence.

    The major schools of thought are all wrong. The Beansian school, which attempts to use mathematics to explain fart molecule movement, and seeks to change the environment that the fart exists in, is far to limiting, as it leaves out the intent of the individual painting the fart. It tries to differentiate between individual and government control of fart painting, but fails, as it causes some molecules to become stagnant while accelerating the motion of other molecules. The Neoclassical school puts far to much emphasis on supply of fart molecules and demand for the finished painted fart. And then of course there is the ridiculous Libertarian school, which, when you sum it all up, really wastes a lot of molecules and the finished painted farts are pretty ugly. All schools of fartonomics also impose unnatural constraints on the paint supply, most egregious of which is to loan or give paint credits to some few players while restricting paint to others. Paint credits have been around for a long time but have really taken hold since the invention of movable type which has given the sell out scribes of the rich louder voices than the rest of us. They have used this louder voice to propagandize us all into accepting this credit practice which has some basic merit if judicially used but has been abused to the point that most of humanity is now paint starved and the worlds resources are being wasted on fewer and uglier fart paintings.

    Most important however — and overriding all of the above very simplified complexity — is the fact that a lot that a lot of the players in all schools of fartonomics lie like fucking rugs. The answer of course, if we really want to see some strikingly beautiful fart paintings created by all, is to apply greater perception to the deceptions, and impose much stronger regulations that will kill off those who deceive. I would call it Faironomics.

    Screw Elizabeth Warren — sell out dolt!

    Deception is the strongest political force on the planet.

    1. craazyman

      That’s so true. And the other thing that really “stinks” is the social cost imposed by the act of fart painting.

      Especially with spray paint. It not only covers the fart, but covers everything within 10 feet of the fart and even beyond. There are some people that will say that’s a form of beautification! Can you imagine? They must be psychopaths (or bankers, LOL). Others will say it’s a necessary evil we have to tolerate for the good of society. They would argue that without painted farts, we would not have the freedoms we now have — like working two jobs, one at the private prison and the second at the Motel 6 desk — so you have the cash flow to pay for your therapy and Zoloft prescription that helps you deal with your life stresses.

      But the painters, they don’t care do they. They are doing the lord’s work after all.

      After all, we taxpayers will fund the cleanup.

      1. i on the ball patriot

        Oh yes, I forgot about the spray painting. It is definitely malodorous!

        But that’s what happens when you take the best and brightest minds out of our finest schools and turn them to working in fartonomics for the benefit of the few wealthy elite gallery owners. They come up with these crap products. Its the same with electrostatic potential energy discharge painting. Jillions of molecules — which amounts to trillions of farts — have been instantly destroyed and no longer have any value. Phew!

        But I guess you really can’t blame the kids, after all they have to go where the molecules are. The real problem is when the kids help the few painters and gallery owners slice and dice the shitty fart paintings into derivative paintings and sell them to pension managers and central art dealers in foreign lands.

        That’s why I say Elizabeth Warren is a dolt. She knows that and will keep the investigations localized to the scamerican gallery … Joly will do the same thing in the Iceland gallery … and look what happened at the Soc Gen gallery where they are still blaming that poor trader for “massive fraudulent molecule debasement”. He is screwed!

        What is really needed is a comprehensive global investigation of all of the galleries. But that will be hard to pull off with the gallery owners naming their own galleries and spreading these deceptive products all over the globe.

        Its all really sad. Makes you want to go eat a hot bean and chicken burrito…

  5. joebek

    Another aspect of the disparate treatment of capital and labor is in taxation. If the returns on the capital investment of acquiring a medical degree where treated in the tax system similarly to the those from the sale of equity we’d probably have a lot more doctors and a lot fewer PE types. Part of the problem is that the nomenklatura is tied up in a quasi Marxist conception of politics as class struggle. It is going to be extraordinarily difficult for the the nation to extract itself from this bind.

  6. ronald

    Dorman’s rant never touches the subject of Clinton era turn to the financial/tech sector as America’s new economy. Industrial automation,multi-national outsourcing of factories and labor to lower cost markets combined with the repeal of Glass-Seagall became the official political agenda giving rise to lax financial regulator activities to cheap money policies. The grand economic scheme would replace human workers with new technology and our work force would reflect this change driven by information/marketing age ideology rather then manufacturing cycles. One of the main intellectual forces behind this economic model was Larry Summers, now being asked by the political insiders to please fix this mess.

  7. John

    I’d like to hope that the TSA and sister agencies have been watching all sorts of travelers for a while, and probably not always wearing TSA uniforms while doing so. This is routine in many other parts of the world, even with computerized face identification software. The problem is with the guys not in the system, and one is pretty well reduced to spotting behavior patterns in these situations.

    A couple of decades ago I flew from Dublin to London. As we arriving passengers walked up the ramp from the buses to the Heathrow baggage claim area, there were several plain clothes officers we had to pass eyeing the crowd. As I walked by one I said, “Who are you guys looking for?” The guy replied, never taking his eyes off the crowd, “Not you, mate. Keep moving.” British officers had learned it was a good thing to eye the passengers arriving from Ireland, at least. Perhaps they did the same with other arriving flights, but I never saw it if they did.

  8. Nostradoofus

    Yes, swine flu has killed 3900 this year. But that’s the same rate as food poisoning, and far less than car accidents.

    So it’s not clear why H1N1 gets so much coverage. I’m not taking sides on the vaccine, just pointing out that none of this is worth our attention.

    1. fresno dan

      Medical workers balk at mandatory flu vaccines Reuters


      At its most basic, the problem is that it may not even be possible to evaluate an ever changing virus in a clinical trial- ever year the strains (typically 3)used in the flu vaccine are different (well, not every year and sometimes they overlap – but I am not aware of any year that all three strains were used in the subsequent year).

      One also has the thorny issue that the people most susceptable to the flu, i.e., the old, may be the least protected by a flu vaccine.

  9. Will

    TSA continues to waste time and resources if the hints in the article accurately capture their practice. Drug arrests, false IDs, and resisting arrest. Classic garbage police entrapment of non-violent petty crimes, if we still want to consider drugs a crime. Meanwhile the FBI still has no clue what to do when it gathers evidence of a real threat.

  10. MyLessThanPrimeBeef

    I am not sure how much crytolographic voting will help compared with training more professional voters, since poliiticians who work for voters (in theory) are professional themselves.

    Basic management theory dictates that if workers are professional, then their supervisors should be at least professional as well. You don’t hire amateurs to management professionals, do you? There is no hope of managing your professional workers if you are not a professional yourself.

    How does one become a professional voter, a professional, citizen, you ask? At a minimum, four years of exclusive study of citizenship/votership (mandatory for all citizens so no one will be excluded) and after completion of that education, you practice citizenship 8 hours a day, 5 days a week. Of course, the government will have to pay its citizens accordingly – at least more than an average freshmen congressman or woman; after all, they are his or her supervisors.

    The four year education requirement can, of course, be waived for ex-politicians-turned-citizens. They already know enough.

    1. Skippy

      That would be great, but first we have to fix the voting machines. The problem before was the manufactures, their political connections and the hacking of the RAM modules.

      Skippy…until we can secure the mechanical process of voting all other considerations are

        1. Skippy

          Thanks now I have to spend the rest of the day scrubbing out my mind, that photo.

          Skippy…The comments below were a hoot to boot, the fact that a couple of generations adhere to the mother of all self help books makes my back-side cry.

      1. MyLessThanPrimeBeef

        As a compromise, I’ll go along with that.

        But I still want trained, well-paid professional voters.

        Democracy can’t function with professional and well paid politicans on one hand and igorant amateur voters on the other hand.

        1. Skippy

          American Mandarins hope the outfit is just as cool. Maybe that would work for a few generations till a cleansing must occur.

  11. Hugh

    I agree with Will about the TSA. 813 arrests out of 99,000 encounters is a rate of 0.8%. Not one of arrests mentioned had anything to do with terrorism. The statistics for who was arrested for what are also not given. The grounds for whom they target are extremely dubious as well: people who “seem highly nervous or stressed.” What does that even begin to mean? It could apply to virtually anyone. These TSA agents aren’t out there catching terrorists. They are trolling a public space using the cover of the Global War on Terror to engage in random acts of surveillance, and they are really bad at it. Just look at the 98,000 people’s lives they intruded upon for no good reason.

    I assume the purpose of such a story is to make passengers feel safer with the holiday travel season coming up but if you realize the TSA agents have a 99% fail rate, you just might feel less safe. And if there are any calm and collected terrorists out there, you might even feel worse.

Comments are closed.