Links 8/16/13

Olinguito: ‘Overlooked’ mammal carnivore is major discovery BBC

Extreme Heat Waves to Quadruple by 2040, According to New Study Alternet

Mouth bacteria may trigger bowel cancer BBC (John M)

National Academy Of Sciences ‘Misled The World’ When Adopting Radiation Exposure Guidelines Science 2.0 (John M)

Water Shortages Pose Greatest Threat to US Economic Growth OilPrice

Criminologists identify family killer characteristics BBC (Lambert)

Cambodia suspends military programs with US Associated Press (furzy mouse)

Easy Credit Dries Up, Choking Growth in China New York Times

The crisis in living standards & how to solve it Touchstone

Europe’s Slow Financial Reforms Simon Johnson, New York Times

Egypt Erupts:

Death toll soars to 638 in Egypt violence Associated Press

‘Horrible’: Christian churches throughout Egypt stormed, torched CNN (furzy mouse)

Egypt’s Brotherhood calls for ‘day of anger’ Aljazeera (Lambert)

Egypt poised for renewed protests BBC

Updated: Experts reflect on Egypt’s turmoil Aljazeera (Lambert)

Big Brother is Watching You Watch:

Report: Secret Service Targeted Aaron Swartz Jonathan Turley

Edward Snowden downloaded NSA secrets while working for Dell: Sources Reuters (Deontos)

All Three Branches Conduct Vaunted NSA Oversight! Marcy Wheeler

NSA Surveillance Broke Privacy Rules Thousands Of Times Per Year: Report Huffington Post (Deontos)

Exclusive: Edward Snowden Says Media Being Misled ‘About My Situation’ Huffington Post (Carol B). It was clear from the get-go that the father was (at best) a loose cannon and his attorney was bad news (the letter they put out early on was embarrassing and they haven’t upped their game).

Dissent, Disappointment and Draconian Rule: Bradley Manning’s Plea and the Fight to Be Human Chris Floyd (Joe)

Soon To Be Disrupted Industry Enjoys Margins Multiples Of That Of Cocaine Dealers! Reggie Middleton

Texas Towns Frack Their Way To Drought Conditions Real News Network

Summers Storm:

Do not nominate Larry Summers to head the Federal Reserve White House Petiton (dcblogger)

Nominate Janet Yellin as the next Chairman of the Federal Reserve Board and not Larry Summers — NO MORE CRONIES !!! White House Petition (dcblogger). Please sign both petitions! Might as well rub Obama’s nose in what a bad choice Summers is.

Obama’s Approval on the Economy Drops Sharply Jon Walker, Firedoglake

BofA may settle with FHFA Housing Wire (Deontos)

Financial-Industry Group to SEC: This Letter We Ghostwrote for House Dems Proves We’re Right Mother Jones

NYU will cease loans to top employees for second homes New York Times (rich). Score one for the Times. But what about the outrageous deals for first homes?

Some Economic Implications of Global Climate Change Menzie Chinn, Econbrowser

Ben Bernanke: Buy One Suit, Get Three Free Institutional Investor

Philly Fed Misses Expectations; Industrial Production Unchanged; Manufacturing Declines; Treasury Yields Soar Anyway Michael Shedlock

Escaping from the Friedman Paradigm Dan Kervick, New Economic Perspectives

Antidote du jour:


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  1. Ben Johannson

    Why is the Administration sending out flunkies to claim Snowden got some of his info while at Dell? Once again we have a stenographer attributing their sources to “anonymous U.S. officials” which is of course code for “Obama spin machine”. Are they trying to nail him for corporate espionage as well? If so they really must be desperate to think that this will change anything. Perhaps they’re doing the old communists show-trial routine where they pile up every bullshit charge they can think of to fry him in the court of public opinion?

    1. Kurt Sperry

      Assange claims the Russians are playing nice with Snowden and not trying to pry information from him. This strikes me as entirely reasonable–if Snowden was one of literally thousands of admin with access to the same information it’s probably safe to assume that the Russians already knew essentially everything Snowden does, in fact almost inconceivable that they didn’t. Further, the propaganda value of the whole affair would be destroyed either by reports of coercive interrogations or any unexplainable prolonged silence from Snowden necessary to conceal such interrogation.

    2. Andrew Watts

      @Ben Johannson

      They’re not trying to add more charges. Honestly, I think they’re -still- trying to get a handle on how much potentially compromising intelligence Snowden had access to. They’re digging deep in his employment history as a part of that investigation, and whatever else given his alleged hacking skills.

      Nor do I think these leaks are sanctioned by any individual in the Obama Administration. We’re just fortunate enough to get the tidbits from that investigation as it leaks out.

      @Kurt Sperry

      With all due respect, Assange is not an individual I would trust to make that judgment. He didn’t know about, or even suspect the American intelligence assets in his organization. It’s not hard to imagine that Wikileaks would be the target of other intelligence agencies.

      Snowden has been meeting with some very interesting individuals since landing in Russia. Many of whom have overt ties to the FSB and/or the Kremlin. That includes his Russian attorney. I would expect the Russians to have put him through a preliminary debriefing at the very least. Most people who support Snowden’s actions don’t want to believe that he is a defector. Whether that was a willful choice or forced by circumstance.

      We already know a little about the Russian equivalent of PRISM, thanks in no small part to the anti-Putin opposition. It doesn’t sound as advanced or complicated as the NSA’s creation. It’s entirely possibly that Snowden could help them refine their domestic snooping program.

      1. Ben Johannson

        The Administration’s favorite tactic is to leak what it wants believed via “anonymous officials” who provide zero evidence of their claims and are almost invariably later revealed to be lying. One would have to be foolish to assume any info coming out in that manner is trustworthy.

        Also, it’s problematic to insinuate Snowden is cooperating with the Russians to harm the U.S. without at least a supporting link.

        1. Andrew Watts

          There isn’t going to too many people who will speak about this on the record. Every little piece that makes it to the press is not necessarily a administration approved piece.

          “Also, it’s problematic to insinuate Snowden is cooperating with the Russians to harm the U.S. without at least a supporting link.”

          He took a lot of classified material with him to Russia where he received asylum. You don’t have to insinuate anything, that sounds suspicious as all hell to any impartial observer. It begs the curious question did he exchange anything for asylum?

          That’s totally ignoring the role of the FSB. How can I say this the nice way? These are people used to getting what they want from individuals.

          1. Ben Johannson

            Again, the accusation Snowden is giving classified material to the Russians is entirely supposition. And again, anonymous sources in the Administration are not trustworthy.

      2. Kurt Sperry

        Yes Snowden could help them, but there’s no need for him to. There are apparently several thousand people with the same admin perms and access Snowden had, they are apparently paid about what a policeman or fireman with seniority makes. Given the billions the Russians could spread around if necessary, what’s at stake and the number of ripe targets, the chances they hadn’t bought enough off to tell them whatever they want to know must be almost exactly zero. Secrets thousands of people can access that someone is willing to pay whatever it takes to get aren’t secrets, they are simply commodities. The only question is the price they can fetch.

        1. Andrew Watts

          That’s an interesting argument. Snowden couldn’t possibly hurt the United States because the Russians have everything they already want. That may be giving their capabilities too much credit, and perhaps not enough credit to American intelligence.

          They don’t appear to have that much amount of money to entice traitors. The FBI traitor Richard Hanssen got a million and a half or so over two decades.

          1. Kurt Sperry

            It’s just common sense and human nature. Remember PFC Manning’s “Cablegate” leaks and how it came out that literally tens of thousands of even low level employees had the same perms Manning did? Do you really think, and more so given the ease with which digitized data can be surreptitiously copied and moved today, that anyone outside “the loop” who was sufficiently motivated could not have obtained copies of whatever data they wanted from that pool of data? Even the most crude national level intel agencies with access to attractive women and envelopes full of $100 bills–and I assume the Russians are orders of magnitude more capable than that–could obviously have obtained any or even all of the data Manning dispersed to the press. Same here with Snowden and the NSA data.

            “Secrets” that thousands of people can readily access–and more so when the data are already digitized not even needing to be scanned–are simply insecure. Always. The only question is the cost and effort required for people outside the organization to obtain them.

            Think about it, the only people without the means to bribe, blackmail or otherwise divert that data are the public. Journalists almost completely rely on people acting out of conscience, principle or scruples, the so-called bad guys aren’t constrained by such concerns, they’ll send out the pretty girls and cash stuffed envelopes and get whatever they want.

            Given all this, it becomes clear that the real purpose of all this secrecy isn’t to keep it out of Russian or Chinese hands but out of the public view where the US citizens and voters could act on it. The Russians obtain the data and keep it quiet to protect their ongoing sources, no big deal, nobody is publicly embarrassed there is no political blowback. If a whistleblower acting on principle releases the same information and makes it available to the press and the American electorate, huge deal, powerful people are embarrassed and exposed, unpleasant consequences immediately ensue.

            The secrecy isn’t intended to keep the Russians from obtaining it, that is essentially impossible, the secrecy is to keep the press, the American public, and the global public in the dark.

            1. Andrew Watts

              The problem with this is that out of all the intelligence agencies, the NSA seems to be the one agency that the Russians have had trouble with compromising. They’re likely to have an interest in any insider information that a individual like Snowden could possibly have in his possession. That doesn’t mean that Snowden could tell them anything that they don’t already know, but I don’t honestly believe that the Russian intelligence agencies are any more infallible then our own.

              I’ve always operated under the assumption that there are multiple levels above top secret clearance. It would seem there would almost have to be with thousands of people holding that level of clearance. Snowden didn’t seem to mind about openly hinting he had access to everything. The Manning situation is quite different seeing as the military operates on more open ground considering their mission and responsibilities.

              After the arrest of Aldrich Ames (and Hanssen), I would expect that American intelligence agencies would do more to compartmentalize their intelligence. Not only from outside intrusion, but within the community itself. Just because an individual holds a top secret clearance it doesn’t mean they’ll necessarily have access to all the accumulated intelligence that is shared between agencies.

              The culmination of all these thoughts is that I don’t agree with the sentiment that Russian intelligence knows everything worth knowing. It’s a possibility but unlikely, considering that we haven’t heard any rumors about an end to the damage assessment investigation. It’s likely Snowden knows/possesses a great deal that would be of interest to Russia/China.

          2. Kurt Sperry

            “They don’t appear to have that much amount of money to entice traitors. The FBI traitor Richard Hanssen got a million and a half or so over two decades.”

            The cheapness with which assets can be bought says nothing about the available resources to buy them. I’ll bet the Russians have had many a good laugh about how cheaply they can buy American assets off. I’ve been astonished myself to learn how little it takes to buy people off. Russia is a country where the ruling oligarchs wouldn’t miss a the odd billion dollars here and there, I doubt they are cheaping out on payouts to obtain information they want badly.

            1. Andrew Watts

              They didn’t try to entice him with money or women to turn traitor. Hanssen was the one to approach the Soviets. It’s a minor detail concerning your point though.

    1. Jim Haygood

      As China founders, we are told that the eurozone economy started a recovery in the 2nd quarter:

      Preliminary figures released Wednesday showed that the economy of the 17-country eurozone region expanded 0.3 per cent in the second quarter over the first quarter, ending an 18-month contraction that destroyed the jobs of millions and kept national debt burdens not just intact but growing in countries such as Italy and Greece.

      Really? From a contrarian point of view, it’s always darkest before dawn. So the utterly grim unemployment news out of Spain and Greece could in fact be consistent with a trough, under the theory that it can’t get any worse.

      But in an era practically defined by official lying, nothing can be taken at face value; particularly not economic statistics.

      Our central banksters, obsessed with expectations, like to create their own (upbeat) expectations by any means necessary, including baking the data. For instance, the pattern of stock market returns in Europe does not show a deep trough in 2012-2013 like the one that occurred in early 2009, partly thanks to endless QE, ZIRP, LTRO, MAD, PTSD, whatevah …

      So, welcome to the new Boom! Have you gone shopping today, comrade?

      1. MyLessThanPrimeBeef

        Darkest before dawn.

        Not always true.

        Just like ‘it’s insane expecting different results doing the same thing’ – no, it’s not. It’s sane to do that in dice-throwing.

        Back to dawning – At the dawn of a dark age, it gets darker and darker.

        It doesn’t get less dark at such a dawn.

    1. ambrit

      Dear gonzomarx;
      Perhaps we’d like it to be “Lions led by Donkeys!” But then, considering the symbology attached to goats, especially the Satanic ones, this version is spot on.

  2. aet

    RE: Radiation dose and toxicity as per the NRC guidelines

    Consider the case of ex-President Jimmy Carter, exposed to a lots of low-level radiation as a Naval nuke specialist while young in the 1950s…and now, still hale & hearty at 91 years of age.

    It is possible – it’s at least conceivable – that low-level exposure to radiation is helpful for living cells, as it may “toughen up” and “tune up” the mechanisms which our cells use to repair mutations, mutations which may otherwise be the cause of most cancers:

    Wider adoption of nuclear power may just be the answer to climate change, after all…

    1. XO

      Jimmy Carter is a very brave man, who risked his life via exposure to radiation when others wouldn’t.

      I doubt Carter would have lived as long had he been exposed directly to Chernobyl or Fukashima.

      Radioactive waste is deadly pollution we cant get rid of, and which will outlast humanity.

      1. aet

        The goal here is accuracy in the assessment of risk in order to formulate best poilicy in response to the ongoing disaster of climate change.

        The current belief in the toxicity of low levels of radiation appears to lack rigourous evidential support in the scientific literature, in contrast to the science as to climate change.

        If this current risk-assessment model as to low-level radiation exposure is based upon assumptions which are in error or unfounded on evidence, our circumstances of ongoing and accelerating climate change has created a pressing and urgent need to rectify it!

      2. Lethal

        XO – Actually you can get rid of radiation…. I suggest anyone interested research Thorium Reactors….. U238 or Plutonium in low grade Thorium out – 500 years and it is the same as your backyard dirt. Easily stored for the period and NOT highly radioactive.

        Wonder why no one but the Indians are building them?

        1. optimader

          RE; Thorium power,,,As well as other non-critical reactor designs.
          Ultimately the way to get rid of high level nuclear waste will be to “burn it” reactors of safer design, and they do exist. Something like 955 of the energetic value of the fuel is abandoned as “waste” for reasons I wont go into. Unfortunately we commercialized one of the worst reactor designs for power generation. The underly objective was not power it was Plutonium production, but that can has been kicked down the road her eon NC.

          Skimming the article, Edward J. Calabrese is an asshat.

          I would suggest the following, those who feel there are salubrious levels of ionizing radation should all participate in a long term exposure health study, XO you included.

          Excuse me if I am always suspect of the underlying motivation 20/20 hindsight critiques of what the “feels” were the misleading statement (to the conservative) relative to exposure.

          IMO what is NOT treated accurately in common discussion of exposure to ionizing radiation sources is PROXIMITY. Radiation source emission can be misconstrued as a very low dose by virtue of dilution.

          What is not accounted for is proximity. Levels of ionizing radiation sources in my environment could hypothetically be characterized as “low level”. If on a very unlucky day I were to incidentally inhale a mere speck of aerosolized gamma emitter dust, say dust that settled in my hypothetical yard in Belarus or Japan or.. Oregon, that piece of dust is imbedded intimately in my lung tissue and the Distance in the inverse square rule of exposure intensity goes to ZERO and it is no longer trivial levels of background radiation. Every decay is going through my tissue rather I am a dead man walking in my low level background radiation yard.

          1. F. Beard

            We’ve been dead men walking since we learned to walk.

            Me, I don’t worry. Illnesses come and go for no discernible reason. In some ways I’m more healthy than 20 years ago and that might be true 20 years from now too.

            1. optimader

              You may not mind this trip through the mortal coil unnecessarily expedited to an agonizing end, drowning in your own fluid, due to some idiots poisoning you w/ ionizing radiation.
              I do, I know, silly me.

              1. F. Beard

                It’s tough being godless; I sympathize. Once you’re past all your primes then what possible hope can there be?

                Me, my hope increases nearly every day, though all my primes should be behind me. Why? Because I keep plowing through the Bible and it’s becoming clearer and clearer.

                1. Pete

                  It will be interesting to see people in their Hazmat suits reading and finding great comfort in the scripted fables of the supernatural.

                  1. F. Beard

                    More comfort than you’ll have since you are just as doomed to die.

                    There’s a strategy in Bridge (or any card game) that says that if the cards must lay a certain way for one to win, then one SHOULD assume they lay that way and play accordingly.

                2. optimader

                  “…It’s tough being godless…”

                  That may be Beard, based on your comments it is certainly more Humane as well.

                  Not sure what the “primes” are?

                  Don’t take this wrong Beard, I’m not advocating that you do it, but following teh breadcrumb trail of your logic why don’t your just put the .45 in your mouth this evening to expedite the process? That would save all this messy and awkward corporeal practical joke god is playing on you?

                  What you express is EXACTLY what scares the liv’in bejezzuz out of me when Fundies are in positions of authority that can adversely affect other peoples measly lives.

                  1. F. Beard

                    Not sure what the “primes” are? optimader

                    You know speed when your 18, strength in your 40s, intelligence in your 50s.

                    What you express is EXACTLY what scares the liv’in bejezzuz out of me when Fundies are in positions of authority that can adversely affect other peoples measly lives. optimader

                    That’s a cliche. And Bush II turned out to be a coward. Didn’t he? On 9/11? And when he dodged Viet Nam? He doesn’t sound like much of a Christian to me. It doesn’t sound like he was unafraid to die.

                    And if you knew anything about the Bible you’d know the moral and ethical standards are so dang high that recklessness with the lives of others is out of the question. But would you know that for fear that your own moral standards would be exposed if you read it?

                3. F. Beard

                  based on your comments it is certainly more Humane as well. Opti

                  If so, that’s a reflection on ME, not the Bible which is very humane indeed. But I daresay that I’m as humane as many in my personal life AND IMPROVING. You?

                  And my comment to you was humane; I’ve been godless myself and I DO pity you or at least DID. Now I’m tempted to dust my feet off.

                  1. skippy

                    “Dusting your feet off” is a sign of ***indignant superiority*** – felt – by an – individual – which is enabled by literature that exposes such distinctions via a non corporeal author.

                    I suggest people make them selves knowledgeable about see: The Chicago Statement on Biblical Inerrancy on Oct 1978 – a fundamentalist neocon pact.

                    skippy… citizens of the united states thought when they voted for O=bot that the necon scare was over. IMO it is a time of consolidation of ground gained, a staging point for the next big push.

                4. reslez

                  Sadly, both Mr Beard and optimader here will never experience heaven and its many wonders, where our good deeds during life are rewarded with a beer volcano and stripper factory for all eternity. I have no evidence or data to support the existence of Pastafarian heaven, but happily Mr Beard requires none. Simple, pure faith is enough. Also there’s a book that says so. Read it and rejoice, fellow Noodlers! Ramen.

                  1. F. Beard

                    If undeniable evidence was presented then Alan Greenspan, Obama, Adolph Hitler and Joe Stalin would make sure they got into Heaven but would it still be Heaven with those characters there?

                    That said, the evidence is more than adequate. However:

                    This is the judgment, that the Light has come into the world, and men loved the darkness rather than the Light, for their deeds were evil. John 3:19 New American Standard Bible (NASB)

    2. aet

      Add to ex-President Carter’s example of living into his nineties (and hopefully beyond!) even though suffering such radiation exposure this item.

      The only known survivor of both the Hiroshima and Nagasaki nuclear attacks died – at the age of NINETY-THREE! how “deadly” can low-level radiation exposure REALLY be, if such examaples of longevity subsequent to – and despite – such exposure exist?

      1. XO

        Former Chinese leader Deng Xiaoping chain smoked for 70 years, and died at 93. What’s your point?

      2. Crazy Horse

        Pointing to a single example of anything as proof of a scientific theory is about as loony as believing you can fly by placing a propeller on top of your tinfoil hat.

        Good luck Orville.

      3. neo-realist

        Churchill smoked cigars, drank like a fish, had heart attacks and strokes and lived to the age of 90.

        Some people luck out on genes.

        I’m a skinny dude with high blood pressure:(

      4. Massinissa

        Anecdotes are really not a great way to prove a case, man.

        There are such things as anomalies and outliers.

        Do a study of a few thousand people to low radiation exposure and then maybe we can have a conversation on whether or not low radiation exposure is harmful or not.

        Until you point out more than two people, you really dont have much on your side.

      5. F. Beard

        Moses lived to be 120 with undiminished vigor and eyesight.

        David only made it to 80 (and he had problems keeping warm), probably because of his murder of Uriah the Hittite.

        Yeah, I can see Carter living long since he might actually be righteous.

        Of course, with advances in medical technology we can expect the wicked rich to live longer too but as they say, ugly goes all the way to the bone?

      6. MyLessThanPrimeBeef

        Before science, before technology, it was possible to live 900 years or so.

        It must have been with clean air, organic foods and unpolluted water.

        1. F. Beard

          Actually, it was way before science; it was before the Flood.

          Long life spans tend to favor the wicked, is one theory why they’ve been shortened.

              1. MyLessThanPrimeBeef

                Maybe He appreciates those banksters who do God’s work. You will leave that to Him as well.

                1. F. Beard

                  I’ll leave the tools of the system to those expert in dealing with them. You won’t hear me defending a single one of them.

                  That said, I’m not the one who has ever thought an inherently crooked system could be successfully regulated anyway.

  3. John Steinbach

    Edward Calabrese, is a well known purveyor of the widley discredited notion that there is a threshold of exposure to ionizing radiation below which there is nor harm caused- indeed that it is beneficial. The overwhelming scientific consensus is that any exposure to ionizing radiation poses a risk to human health.

    1. MyLessThanPrimeBeef

      I think it’s all relative…in another 5 million years, we will have evolved the ability to live with that.

      1. optimader

        I know you’re being sarcastic, but not our life forms. Can’t evolve away from cessation of Mitosis as far as I know.

    2. Yves Smith Post author

      I should have flagged the piece with a question mark.

      The problem, even if what he posits is actually accurate, is (I assume) he is talking lifetime exposure. But if you allow yourself to get low level exposure, you’ve reduced your band of safety (as in you’ve moved closer to the danger line) and you are thus at greater risk of going over it.

  4. Brindle

    Room full of cronies—April 2006
    Obama speaking to the Hamilton Project (Brookings Institute).

    Right off the bat O mentions “Bob” “Pete” and “Roger”, these are Robert Rubin, Pete Peterson and Roger Altman.

    Obama was still 9-10 months away from declaring a run for prez. I find this clip interesting because it shows early on who Obama as working for and who he was sucking up to as well as displaying his vanity—no one loves Obama more than he does.

  5. rich

    Cost of drug development always used as excuse for failure to deliver…thought this was interesting.

    How Two Guys From Queens Are Changing Drug Discovery

    They have, and then some. Against the grain of industry trends, the company has found ways to create effective new treatments on bargain budgets. According to a FORBES analysis of 220 drugs approved over the past decade for publicly traded companies, the companies that invented 3 or more medicines spent an average $4.3 billion in R&D per drug. The big boys spend still more: $5.5 billion for Merck, $7.8 billion for Pfizer and $10 billion for Sanofi, Regeneron’s partner on many of its projects. Regeneron’s cost per drug? Only $736 million. “He’s been successful beyond anything I could imagine,” says Fred Alt, the Harvard Medical School geneticist who first told Schleifer about Yancopoulos.

  6. harry

    Its nice that NYU senior administrators will reduce their looting to a less egregious level. Very collegial of them to take the loans for second homes off the table. Im impressed with how responsive the guys at the top are.

    For what little its worth, I will never allow a kid of mine to go to NYU just to feed those f*cking thieves their bonus money. The drug dealers around Washington Square park perform a more socially beneficial function.

  7. David Lentini

    RIP Uncle Milty, You SOB

    Krugman’s commentaries on Friedman show that if anything Krugman is trying salvage Friedman’s reputation, not bury it, by carefully segmenting Friedman’s into an “economist’s economist”, the “monetarist policy campaigner”, and the libertarian “nutty uncle”. As Krugman wrote in the NY Review of Books in 2007:

    Milton Friedman played three roles in the intellectual life of the twentieth century. There was Friedman the economist’s economist, who wrote technical, more or less apolitical analyses of consumer behavior and inflation. There was Friedman the policy entrepreneur, who spent decades campaigning on behalf of the policy known as monetarism—finally seeing the Federal Reserve and the Bank of England adopt his doctrine at the end of the 1970s, only to abandon it as unworkable a few years later. Finally, there was Friedman the ideologue, the great popularizer of free-market doctrine.

    Having constructed these straw men, Krugman then lauds the first, cautiously criticizes the second, and—very briefly—condemns the third:

    Did the same man play all these roles? Yes and no. All three roles were informed by Friedman’s faith in the classical verities of free-market economics. Moreover, Friedman’s effectiveness as a popularizer and propagandist rested in part on his well-deserved reputation as a profound economic theorist. But there’s an important difference between the rigor of his work as a professional economist and the looser, sometimes questionable logic of his pronouncements as a public intellectual. While Friedman’s theoretical work is universally admired by professional economists, there’s much more ambivalence about his policy pronouncements and especially his popularizing. And it must be said that there were some serious questions about his intellectual honesty when he was speaking to the mass public.

    Krugman’s commentary on Friedman the libertarian proselytizer ends with [b]ut let’s hold off on the questionable material for a moment, and talk about Friedman the economic theorist. A point that Krugman never quite gets to in the article, while focusing on the first two straw men.

    But of course Milton Friedman was a whole person, and Krugman subtly has to admit that all three straw men, like the Trinity, are indeed really one and the same, which becomes apparent when reading this and other Krugman commentaries on Friedman’s career. Friedman’s academic work led to his ideas of monetarism and libertarianism. And while he may have made important contributions to academic economics, using, as Krugman emphasizes, circumspection and restrain in applying his assumptions on human rationality, his work as a monetarist and libertarian were nothing short of zealous. And not surprisingly, those two ideas failed.

    But Krugman is chary to get into those details: other than to discuss briefly the failure of monetarism, he studiously avoids the brutality of Pinochet and only vague talks about the economic disasters in Latin America that can be laid a Friedman’s feet. And Krugman absolutely won’t discuss the disintegration of American political culture that Friedman did so much to foment.

    Krugman concludes his Review with his usual wishy-washy-ness:

    In the long run, great men are remembered for their strengths, not their weaknesses, and Milton Friedman was a very great man indeed—a man of intellectual courage who was one of the most important economic thinkers of all time, and possibly the most brilliant communicator of economic ideas to the general public that ever lived. But there’s a good case for arguing that Friedmanism, in the end, went too far, both as a doctrine and in its practical applications.

    Yes, too far; and especially too far and brutal for Krugman to discuss in polite (and politic) company. And it’s time we starting that conversation. We have to judge people as wholes, not parts. Whatever Friedman offered for academic economics has to be weighed against his applications of those ideas to our political and culture lives. Clearly Krugman (or Kervick) doesn’t want to do that calculus.

    1. Doug Terpstra

      Krugman is careful not to bite the hand holding his milk bottle, but at least he doesn’t kick those who must clean up the back end of his veal-pen.

    2. Ms G

      I wonder if Krugman had been chosen to write Hitler’s obit, whether he would have devoted the first 3 paragraphs to the revival of the German economy and then only a couple of lines to the man’s ideas about pure races, final solutions, and so on.

      His lamentable (paycheck-saving) piece on Friedman certainly suggests that Krugman simply choses not to see or write about the parts of his chosen subjects that involve human atrocities or inhumane ideologies that cause mass destruction of people’s already precarious economic existences.

      I’ll be he freaks out when he sees an ant near his left shoe.

  8. rich

    ‘Alternative’ Investments Draw Flak

    Outside scrutiny is intensifying on securities firms’ sales practices and whether so-called alternative products—ranging from certain types of mutual funds to vehicles that invest in highly indebted companies—are suitable for all of the Americans flocking to them.

    Mutual-fund giant Fidelity Investments this week began offering clients the opportunity to put money into an alternative fund run by Blackstone Group LP, BX -0.46% the world’s largest investor in hedge funds. The fund will “help provide the diversification and improved portfolio resilience” investors are seeking, Fidelity said.

    Part of the surge in popularity of such investments is due to a push by hedge-fund firms and buyout groups to offer new retail products as part of a search for new growth as sales to their traditional institutional clients slows, according to a report last year by McKinsey & Co.

    Adding to some of the regulatory worries was the Securities and Exchange Commission’s decision in July, in response to legislation passed by Congress, to permit hedge funds to advertise for the first time, which could increase the visibility of the products.

    “Our concern is there’s a different atmosphere now,” said William Galvin, Massachusetts’ Secretary of the Commonwealth. “Regulations have been eased on advertising, and these firms are using more aggressive sales tactics.”

    Mr. Galvin’s office in July sent subpoenas to 15 securities firms demanding information on their sales practices of alternative products to seniors.

    1. Ms G

      ” … their sales practices of alternative products to seniors.”

      Wow, I didn’t realize anybody in the “retail buy side” would even entertain a piece of *mail* from the financial retail sell-side. Even if they’ve been sitting under a rock, buy-side *has* to know these sellers are after their last pennies and then blood if there’s no legal tender left.

      Hurray for all the financial regulators who are reacting by “worrying” and sending a few subpoenas out, rather than treating this as an emergency requiring immediate attention in the nature of “Cease and Desist” orders (immediately) pending full investigations.

      This is just the government using its “regulator” costume to enable vicious looting of the “retail buy side” by vicious financial retail sellers. In the circumstances it’s impossible not to view the shysters in the financial retail sell-side as Obama’s Cat’s Paw.

      This is grotesque.

  9. diptherio

    File Under: Life Imitating (Dystopian) Art

    The BBC has a story about a new communications satellite that includes an image which shows nine different satellites (as seen from earth), one of which is called Skynet 5a.

    Skynet?!? As in the computer system that causes the apocalypse in the Terminator movies? Either someone has a twisted sense of humor or James Cameron has been trying to warn us all this time.

    After Skynet has destroyed much of humanity in a nuclear holocaust, a group of survivors led by John Connor struggles to keep the machines from finishing the job.

    Maybe the After Hours crew has a point

  10. McWatt

    Does anyone have any insight as to why Nouriel Roubini would think Larry Summers is a good candidate for the Fed?

    1. rich

      Role models

      He credits a number of economists for his understanding of economics. Another intellectual hero is Larry Summers, the former President of Harvard, an amazing intellectual and academic, who is very deeply involved with the policy world. I worked for him for many years in the US Treasury during the Clinton Administration”.[11]

      I believe he thinks Summers is a hero. Now get off the floor.

      1. MyLessThanPrimeBeef

        That’s just an example of this defect in the human genome that causes people to worship, in this case, Roubini worshipping Summers.

        You never find that mental disorder in nature. For example, you will never see a piece of rock ogle another piece of rock or an apple stalk another apple in a grocery store.

    2. Jim Haygood

      While Obama fiddles, the bond market’s burning.

      In 1994, one of the worst years for bonds since the 1970s, the 10-year T-note yield rose 201 basis points, from 5.83% to 7.84%. On a percentage basis, the 10-year yield rose 34% in 1994. Orange County CA went bankrupt, and some other bad sh*t happened too.

      Meanwhile, just since early May the 10-yr yield has popped from 1.6% to 2.8%. That’s 120 basis points in 3-1/2 months. Percentage-wise (probably a better measure of the financial shock), the 10-yr yield is up 75%. Homebuilders, mortgage rates and REITS are all showing the stress.

      Obviously, we need a new central planner ass clown to undo the damage wrought by the present one. Right?

        1. F. Beard

          Why not short-term ones too?

          Why the heck should our government care about the needs of gamblers, since that’s what banks are?

    3. Doug Terpstra

      Summer is the perfect choice as next Fed Shylock; he’s already Chosen. Yellin doesn’t have the proper credentials or gender. Obama serves the dictates of Wall Street, and Summers is the perfect candidate.

      1. Ms G

        Yellen’s only weak point is not having a Rabbi in the Rubinite-Hamilton-Summers cabal. Remember, in this Kleptocracy, the rulers are a very small circle of Cronies.

  11. optimader

    Mouth bacteria may trigger bowel cancer BBC (John M)

    And heart attacks..
    Be very carful about dental interventions, review w/ your dentist any pre-existing heart. I do know of a case secondhand from “the trade” of a young man (40ish) perfect health went in for either a root canal or extraction , mobilized bacteria infected a heart valve and took him out, and quickly..

    1. Yves Smith Post author

      Anyone with mitrial value prolapse is supposed to take a single dose of antibiotics before any dental procedure, even a cleaning.

    1. Tim Mason

      “For three years the government has revived and propped up a very old, Victorian model of the economy. Just as in the 19th century, bankers or creditors dominate policymaking, ensuring that the value of their assets (mainly debt) is not just stable but rises relative to profits, wages and incomes. Above all, as in pre-Keynesian times, creditors lobby to ensure limited public oversight or regulatory control over their huge power to determine the rate of interest on the full spectrum of lending.”

      1. rich

        Cash and Congress: The Tie that Binds

        But seriously. “Although partisanship is an enduring part of American politics, the type of hyper-partisanship we see now — I can’t find a precedent for it in the past 100 years.” So sayeth Bill Galston, a Brookings Institution senior fellow and co-founder of No Labels, which has herded 82 Democratic and Republican lawmakers into a “Problem Solvers Coalition.” Boy, is that ever the triumph of hope over experience.

        “If your desire is to get something done, then you’re going to be very frustrated,” Galston explained to National Journal. Those members “who came to Washington to wage ideological war on what they see as a bipartisan status quo, if you ask them, they will say that gumming up the works is not part of the problem, it’s part of the solution. They’re actually happy when legislation doesn’t pass, unless it’s the kind of legislation that they approve of.”
        Like passing umpteen useless resolutions to kill Obamacare while Detroit dies, bridges crumble and starving kids can’t get food assistance.

        But despite what you’ve heard, the spirit of bipartisanship in Washington is not dead. Simply look past the vitriol, bombast and gridlock, then listen for the ka-ching of the nearest cash register, made flesh by friendly lobbyists and special interests. Their fat wallets and deep pockets bring together Democrats and Republicans like no one else in a collegial spirit of kumbaya as they dive for dollars in exchange for their votes and influence.
        Just the other day, The New York Times reported that one of the plushest places at the table in the capitol is a seat on the House Financial Services Committee, the one that allegedly regulates the banks and Wall Street.

  12. Joe

    From the NYT this afternoon:

    U.S. Housing Starts and Permits Rise Less Than Expected

    “U.S. consumer sentiment ebbed in August and residential construction rose less than expected last month, potentially dimming hopes of an acceleration in economic activity in the third quarter.

    The data on Friday suggested that a recent spike in interest rates, in anticipation of the Federal Reserve tapering its massive bond purchases as early as next month, was starting to have an impact on households..”

    1. MyLessThanPrimeBeef

      How soon before we see college educated busboys…maybe on their way to hedge fund stardom…in Hollywood?

      Wait, I think I saw a few recently.

      1. rich

        It’s not a scandal…it’s a disgrace………..

        “But conservatives most of all should hate the current system for any number of reasons – for being a massive hidden tax, for being a market-defying subsidy artificially keeping ineffective and poor-performing institutions in business, and for being an example of arbitrary government power seizing not just money borrowed plus interest, but billions in additional fees and penalties from ordinary people.

        Progressives should hate the predatory tactics of lenders and the sleazy way universities rely upon loan-shark collection methods to keep themselves in fancy new waterfalls, swimming pools and tenure-track jobs.

        But nobody hates it enough, except for the people actually trying to pay the bills with increasingly worthless degrees. Instead, the credit keeps flowing and the debt bubble keeps expanding, thanks to leaders like John Boehner (whose daughter reportedly works at Sallie Mae’s student-collections firm, General Revenue Corp.) and Dianne Feinstein (who introduced legislation to increase limits on Pell grants while her husband was heavily invested in for-profit colleges).

      1. Yves Smith Post author

        Lambert has picked many good ones!

        And I put up that Disney elephant too a long time ago. Not all antidotes are created equal, sadly.

  13. rich

    Thomas Drake On Government Overreach, Obsessive Secrecy, and Constitutional Abuses

    Thomas Andrews Drake is a former senior executive of the U.S. National Security Agency (NSA), a decorated United States Air Force and United States Navy veteran, and a whistleblower.

    In 2010 the government alleged that Drake ‘mishandled’ documents, one of the few such Espionage Act cases in U.S. history. Drake’s defenders claim that he was instead being persecuted for challenging the Trailblazer Project. He is the 2011 recipient of the Ridenhour Prize for Truth-Telling and co-recipient of the Sam Adams Associates for Integrity in Intelligence award.

    On June 9, 2011, all 10 original charges against him were dropped. Drake rejected several deals because he refused to “plea bargain with the truth”. He eventually pled to one misdemeanor count for exceeding authorized use of a computer.

    1. skippy

      Having a memory sux…

      Erik Prince’s company Blackwater (now known as XE) has been embroiled in controversy for years. Company employees have posted videos online of their own ruthless behavior and abuses against Iraqi citizens, and can be heard laughing off camera. We’re now finding out that this brutality most likely came from the top, down from Prince himself — former employees are finding their consciences and telling horrifying stories about their former boss:

      A former Blackwater employee and an ex-US Marine who has worked as a security operative for the company have made a series of explosive allegations in sworn statements filed on August 3 in federal court in Virginia. The two men claim that the company’s owner, Erik Prince, may have murdered or facilitated the murder of individuals who were cooperating with federal authorities investigating the company. The former employee also alleges that Prince “views himself as a Christian crusader tasked with eliminating Muslims and the Islamic faith from the globe,” and that Prince’s companies “encouraged and rewarded the destruction of Iraqi life.”

      In their testimony, both men also allege that Blackwater was smuggling weapons into Iraq. One of the men alleges that Prince turned a profit by transporting “illegal” or “unlawful” weapons into the country on Prince’s private planes. They also charge that Prince and other Blackwater executives destroyed incriminating videos, emails and other documents and have intentionally deceived the US State Department and other federal agencies. The identities of the two individuals were sealed out of concerns for their safety.

      Dick Cheney, American Warmonger
      In which the pallid, angry veep fervently urges bombing the hell out of Iraq, because he just can’t help it

      We have a war-crazed vice president. An addict, a verifiable military junkie. Many of us perhaps do not fully realize this.

      We are very unfortunately saddled with one of the least charismatic least interesting most intellectually acrimonious and most desperately hawkish, violence-hungry, soulfully inscrutable vice president in decades, and he wants this country at war, now and always. Oh yes he does.

      Dick Cheney, American Warmonger
      Oh my God. I mean, oh my God. Do not look too closely, for too long, at this photo, as it has been known to cause sever colorectral spasming following prolonged viewing. This is either a photo of Vice President Cheney, speaking to several hundred probably very frightened and deeply disturbed members of the Chosin Few, a Korean War veterans group, in San Antonio, Thursday, Aug. 29, 2002, or it is a cast reject photo from Planet of the Lost Mutant Morticians, the Musical. Either way, it’s sort of sad.

      Here is Dick Cheney, speaking to veterans of foreign wars, hyping up the need for a dramatic, wildly expensive pre-emptive strike against evil Saddam and evil Iraq because Saddam is without a doubt right this minute developing super-evil weapons of mass destruction and probably plans to rain them down on cute American babies and squads of helpless virgin cheerleaders at patriotic college football games any minute now, swear.

      skippy… now follow these mobs and individuals to… today… what are the foundational underpinnings… what seas do they inhabit… what means are they prepared to utilize…. what is their motivation???

  14. charles sereno

    Whew! You’re back online. A couple of quickies while you’re still on:
    1) Re NSA: Sen. Foghorn Leahy is “concerned.” Rep. Pelosi, wakened from a deep sleep, is “disturbed.” (Not clear whether it was the message or the awakening)
    2) Meet the Kangaroos of the FISA Court:
    (Chief Roo, Reggie B Walton, is not genetically or pecuniarily related to other prominent Waltons. I guess you’ve already figured that out.)

  15. Furzy Mouse

    Re: Colon cancer and mouth bacteria…my family has a history of colon cancer, and I had 20 cm of my lower colon removed in ’10 due to 3 abcesses…non-cancerous, thank goodness…so to keep the bacteria down, I now use and recommend hydrogen peroxide for a mouthwash, very effective!

    1. JTFaraday

      “Other generations say that we lucked out because there was no major war that took legions overseas, no presidential assassinations, no civil rights battles rocking our home turf. Not true, says Gregory Thomas. “Our war was at home and it was divorce. They were some of the worst divorces in American history.””

      The only things worse than some of the worst divorces in American history are still some of the worst marriages in American history.

      One interesting Boomer divorce phenomenon I’ve observed is the “Viet Nam divorce.” Basically, Viet Nam separated a would-be couple and in the interim the woman’s mother convinced her to marry someone else with some sort of war deferment and purportedly better prospects.

      In the end, things somehow managed to right themselves. Several people who are very close to me have this very same plot line. This can’t be a coincidence.

      No, this is just life. The real war the Boomer generation perped on the X-ers was the culture war, with foaming at the mouth Jim Crow throwbacks on one side, throwing in with the economic wrecking crew, and ham fisted to you, personally, but somehow completely ineffective politically career(ist) liberals on the other.

      A “war for hearts and minds” turned veritable zombie apocalypse!

      Newly degreed Millennial Obamabots were only the latest outbreak of undead deflecting attention from things X-ers could have alerted people to 20 years ago if all their moral superiors weren’t so busy pissing on them to get ahead.

      Now that Paul Ryan wants to, say, privatize medicare and dissolve the pensions and social security you’ve had a hard time earning in the first place, it’s supposed to be some kind of crisis.

      Go on, “Gen-X.” Be big about it. Someone has to finally be the adult in the room (not to say Jesus) and turn the other cheek. It’s going to be you again, right?

  16. Jeff W

    “NSA revelations of privacy breaches ‘the tip of the iceberg’ – Senate duo” in The Guardian here

    Senators Ron Wyden and Mark Udall continue their long-running series of Delphic pronouncements:

    We believe the public deserves to know more about the violations of the secret court orders that have authorized the bulk collection of Americans’ phone and email records under the Patriot Act.

    The public should also be told more about why the Fisa court has said that the executive branch’s implementation of section 702 of the Foreign Intelligence Surveillance Act has circumvented the spirit of the law, particularly since the executive branch has declined to address this concern.

    Funny, that mention of the FISC opinion jibes with the Washington Post’s Barton Gelman’s piece that broke the story Thursday about the thousands of violations:

    In what appears to be one of the most serious violations, the NSA diverted large volumes of international data passing through fiber-optic cables in the United States into a repository where the material could be stored temporarily for processing and selection.

    The operation to obtain what the agency called “multiple communications transactions” collected and commingled U.S. and foreign e-mails…. NSA lawyers told the court that the agency could not practicably filter out the communications of Americans.

    In October 2011, months after the program got underway, the Foreign Intelligence Surveillance Court ruled that the collection effort was unconstitutional. The court said that the methods used were “deficient on statutory and constitutional grounds,” according to a top-secret summary of the opinion, and it ordered the NSA to comply with standard privacy protections or stop the program.

    James R. Clapper Jr., the director of national intelligence, has acknowledged that the court found the NSA in breach of the Fourth Amendment, which prohibits unreasonable searches and seizures, but the Obama administration has fought a Freedom of Information lawsuit that seeks the opinion.

    [My emphasis in both quotes]

    That’s the same opinion that Glenn Greenwald keeps going on about and which the Justice Department has been fighting not to release. (Justice has recently said in a status report in the Electronic Frontier Foundation’s lawsuit against it that it will release a “redacted version” of that opinion on 21 August.)

    This shadowy FISC opinion appears to be key.

    1. Jess

      The bottom line is pretty clear:

      Wyden and Udall can complain all they want.

      The FISA court can issue all the opinions it wants.

      The IGs and DOJ can do all the reports they want, and release or not release them as they see fit.

      The law can and will continue to be broken in ever-increasing ways, but the answer from the government will always be:

      “Who’s gonna stop us? You and what army?”

      And of course, there is no army. And never will be. School’s out, end of story.

  17. BD MacIsaac

    People, please sign the petition against the nomination (God forbid confirmation) of Larry Summers as the next FED chairperson.

    This is important and only ~1% of the required is completed.

    If you don’t know who Summer’s is just Google his name combined with +fraud +crime and you’ll have your evening filled with interesting (and apalling) reading.

    I cannot even comprehend that this is even a possibility. I guess Bob Rubin should’ve come out of retirement and replaced Geithner instead of Lew and the coup would be complete.

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