Subject: WORLD News From: The Dude To: All Date Posted: Mon, Jun 14, 2004 at 19:44:28 (EDT) Email Address: nma@hotmail.com Message: Diplomats and military (and economists) unite in criticising Bush By Joshua Chaffin in WDC More than two dozen members of the military and diplomatic elites from both US political parties are uniting to launch an assault on the Bush administration's conduct of foreign policy, claiming in a letter to be published this week that it has isolated the nation. The 26-member group, known as Diplomats and Military Commanders for Change, includes several people appointed to important positions by Republican presidents Ronald Reagan and George H.W. Bush.Among them are former US ambassadors to Saudi Arabia and the Soviet Union and a former chairman of the joint chiefs of staff, as well as retired Marine General Joseph P. Hoar, who commanded US Forces in the Middle East under former President Bush. Their letter, to be published on Wednesday, represents an unusually broad attack on a president in an election year from the ranks of the career diplomats (Joe?) inside the Washington beltway. It is likely to deepen doubts reflected in recent polls that the nation, under the leadership of president George W. Bush, is on the wrong course. The WH has until now been forced to deal with such professional dissent mostly from individuals such as Paul O'Neill, the former Treasury secretary and Richard Clarke, a former senior counter-terrorism official (and Paul Krugman, a likely future Nobel laureate), both of whom wrote books critical of the administration after leaving their jobs. The broad-based campaign is reminiscent of on launched in April by a group of 52 former British diplomats against Tony Blair, prime minister, over his Iraq policies.Inspired by his attack, former US diplomats in April signed a letter to Mr Bush protesting against his pro-Israeli stance. The US group, which includes both Democrats and Republicans, will claim that Mr Bush's unilateral foreign policies - particularly in the Middle East - have alienated long time allies (remembering Lawrence of Arabia...) while increasing hatred for the US around the world. The group will not formally endorse John Kerry, the presumptive Dem. presidential nominee, though several members have done so on their own. The protest comes after a poll released last week by the LA Times revealed that 56 per cent of Americans believe the country is on the wrong track - the highest number since Mr Bush took office.Nonetheless Mr Bush may be able to blunt the criticism somewhat, as he has recently achieved his greatest successs in reaching out to the international community following the divise decision to go to war in Iraq. He last week won unanimous approval from the UN Security Council (Uff! That's one small step for a man , sigh, one giant leap for mankind, alas, Rwanda etc. etc. etc.?) for a resolution that recognises a new interim Iraqi government chosen with (terribly?) considerable input from the US. Mr Bush also secured a series of photographs (www .coutausse.com/french/somalia/somalia.html) with foreign leaders during a visit to Europe to commemorate the 60th anniversary of the D-Day invasion, and at last's week G8 summit in Georgia that aides hope will convince voters of the president's abilities as a statesman (or politician?)

Subject: Re: WORLD News From: The Dude To: The Dude Date Posted: Mon, Jun 14, 2004 at 19:47:53 (EDT) Email Address: nma@hotmail.com Message: ...or a resolution that recognises a new interim Iraqi government chosen with (terribly!) considerable input from the US. Sorry!

Subject: Unions From: Jack To: All Date Posted: Mon, Jun 14, 2004 at 19:26:18 (EDT) Email Address: jjlwmd@yahoo.com Message: I'm curious about something: what do economists think of unions? Of course those on the right allege that unions distort market forces and lead, well, to all kinds of bad things like overpricing and (ironically) unemployment. But what do those who don't look upon unions so unfavorably have to say? By the way, if the case can be made that unions are more beneficial to society than not, how is globalization affecting the union movement overall? Are those industries specializing in exporting unionized? How much? What about the non-tradable goods and service industries, how are the unions doing there? I mean, out of the overall 12% or so of the American work force that is unionized. Thanks, Jack

Subject: Re: Unions From: Bobby To: Jack Date Posted: Tues, Jun 15, 2004 at 00:46:43 (EDT) Email Address: robert@pkarchive.org Message: If I remember labor economics correctly, there are two models of their effect on employment. There is one model called the 'monopoly union' model where the union has a monopoly on the sale of labor, the unions choose the wage, and then firms choose the level of employment on their labor demand curves that is consistent with that wage. Since firm labor demand slopes downward, if the union chooses a wage greater than the competitive wage, this decreases employment and loss of social surplus. This is the usually case that people implicitly are talking about when they say that unions cause unemployment. [The monopoly union's choice can be modelled this way: firm labor demand is the budget constraint and unions have a utility function increasing in employment and wages. Unions simply maximize that utility s.t. that budget constraint holds, and that is the (employment, wage) bundle that occurs under unions]. However, for industries with very steep labor demand curves, this unemployment/efficiency loss problem is smaller. The second model is called the 'efficient contract' model, where firms and unions negotiate over wages and employment. As usual unions want greater wages and employment which yield greater utility while firms want less wages greater employment which yield greater profits. There is a set of (employment, wage) bundles called the contact curve [in a model the contract curve is a set of (wage, employment) bundles called the contact curve at which the the firm's isoprofit and union's isoutility curves are tangent to each other], at negotiations determine which point on the contract curve they choose. The shape of the contract curve is determined by the specification of the firm's profit function and union's utility function. In the lucky case where the contract curve is vertical they always choose the bundle that keeps employment at its free market level it is efficient since all resources are allocated as they would be in perfect competition and no resources are being drawn from or to other markets. If this bundle has a greater wage level than under the free market, the unions have just made a lump-sum transfer of income from employer to workers. If the contract curve is upward sloping negotiation can only increase wages and employment. However, this causes inefficiency in a competitive general equilibrium economy, since scarce resources (labor) are being drawn from other markets and it would yeild greater aggregate social welfare if they were employment in those other markets instead. If the contract curve is downward sloping negotiation can increase wages but only at the price of decreased employment. This causes inefficiency in a competitive general equilibrium economy since scarce resources (labor) are being sent to other markets and it would yield greater aggregate social welfare if they were employed in this market instead. Which model is better? Likely the second one,and a sketch of the reasoning is that empirical evidence shows that unionized firms generally do not have (employment, wage) bundles that are on their labor demand curves. It is controversial whether the contract curve is vertical. On the no verticality side, some studies show that employment in unionized firms is sensitive to the union wage. The strongest evidence in favor of verticality is that if there is a $1 unexpected increase of the share of rents going to union workers the value of the wealth of the shareholders of the unionized firm decreases by exactly $1. See Ch 11 of Labor Economics by Borjas on this topic

Subject: Re: Unions From: El Gringo To: Jack Date Posted: Mon, Jun 14, 2004 at 20:00:51 (EDT) Email Address: nma@hot mail.com Message: Excellent question

Subject: Re: Unions From: Paul G. Brown To: El Gringo Date Posted: Mon, Jun 14, 2004 at 20:22:17 (EDT) Email Address: Not Provided Message: Excellent answer. ;-)

Subject: Re: Unions From: El Gringo To: Paul G. Brown Date Posted: Mon, Jun 14, 2004 at 20:32:44 (EDT) Email Address: nma@hotmail.com Message: Hehe, I know ;-)

Subject: Argentina From: RL To: All Date Posted: Mon, Jun 14, 2004 at 11:51:50 (EDT) Email Address: rafaelloring@yahoo.es Message: Bobby you might put this in the other's on Krugman section. http://www.forbes.com/columnists/business/global/2004/0607/050.html

Subject: Re: Argentina From: Mik To: RL Date Posted: Mon, Jun 14, 2004 at 18:06:57 (EDT) Email Address: Not Provided Message: RL, It has been quite sometime since I last read a Krugman book. But from what I last remember, Krugman warned against the Argentina case - not because they had a fixed currency, nor because they needed a floating currency, but rather because they weren't able to make up their minds quick enough. Exactly the picture that is portrayed in the article. Now if the article could make exact reference to what Krugman said (where, what and when) then we'd have more clarity on the issue. The one distinct remark I remember Krugman saying went something along the lines of, 'Whether you choose to fix your currency or whether you choose to float it, make your mind up fast and act on it fast.' As a classic example, I believe Krugman advised the leader of Malaysia to fix their currency quickly (against the IMF's advice). The leader of Malaysia did exactly what Krugman suggested and as such Malaysia avoided an even bigger economic bust. I believe this year the IMF officially appologised to Malaysia for the IMF's stance on what happened during the Asian crisis and stating that Malaysia was right to fix their currency at that time period (vindicating Krugman). In essence my point is that I don't remember Krugman being a serious protestor for floating currencies the way the story (you attached) would suggest. If anything, I believe Krugman took a more pragmatic view that could either allow for fixed or floating currency.

Subject: Power Line blog From: Bill Provost To: All Date Posted: Sat, Jun 12, 2004 at 21:36:09 (EDT) Email Address: bjprovost2000@yahoo.com Message: Does anyone have a response to this? http://www.powerlineblog.com/archives/006893.php

Subject: Re: Power Line blog From: Paul G. Brown To: Bill Provost Date Posted: Sun, Jun 13, 2004 at 01:55:46 (EDT) Email Address: Not Provided Message: Well, in the first place, Thank-God! Evidence! It's a small sign of progress. Where to begin? a) First, the two columns The Great Taxer and An Economic Legend (BTW Bobby, the title on that second column is incorrect) point out a number of problems with the Reagan myth that 'Powerline' (and Mr. Luskin) choose to conveniently ignore (or do they tacitly accept them as verities?). Was the 80's economic boom the longest? (No - Clinton's 1990's was) Was Reagan responsible for the biggest single tax hike in history? (Yes) Could the 80's recovery have been predicted by a Keynesian model? (Yes - deficits do that). Instead, Krugman's critics have focussed, with some profit, on the minute, leaving the larger untruths unchallenged. b) Yes, Luskin has caught Krugman in an error. The figure for effective federal tax rates on the middle quintile of household with children at the start of the Reagan Administration was not 8.2%. It was 8.7%. In other words, payroll taxes increased faster under Reagan than Krugman admitted. Overall, the song remains the same. The point of the column was to puncture a couple of myths about Reagan's economic legacy in an effort to examine what it was that the man achieved. Hence. . . c) Was Reagan a tax cutter? Well, according to the very same table the critics provide, if you were in the bottom 60% of income earners, he wasn't Let's look at the overall numbers. Your tax burden increased under Reagan if you were in the bottom 40% of income earners. They barely changed (down by about 1%) if you're in the next 40%. (I'm rouding up here guys). But for the top 20%, taxes fell by 1.9% (I'm not rounding up here). Is this an impressive, tax-slashin' record? Well, not if you're in the bottom 80%. And, a little context, maestro, if you please. d) Let's look at the Clinton years, 1992 to 2000, in the same table. For the bottom 60% of income earners, overall federal tax burden fell. (Yes - Clinton cut taxes) For the fourth quintile, overall taxes were about the same. For the top 20% it went up by about the same amount it fell under Reagan's term. So: Was Reagan a great tax cutter? Well, no more than Clinton was. Would Mr Luskin agree to the proposition that 'President Reagan was as great a tax cutter as President Clinton'? And at least the Clenis didn't run up a huge Federal Deficit (hat tip to the Heritage Foundation) in the process. e) On Popularity. Faced with the evidence that, during his administration, Reagan was not so popular as he would like to believe, and the fact that Mr Reagan was not the most popular president of the modern era when he left office, Mr Luskin finds a single poll result from 2003 showing that Reagan can get about 1/8 people to say he was best ever. Whenever I am confronted by this kind of statistic, I point out that 48% of Americans believe they've witnesses a miracle. On the other side of the ledger, there is the accumulated evidence that, during his regime, Mr Reagan was only about as popular as Mr Clinton, even though the Clenis was being impeached and steadily slimed. Further, Pres. Reagan never enjoyed the peak popularity of Bush 41 or Bush 43. f) Reagan and unemployment. Look, let's suppose we don't care a fig for the man, either way. Let's look, instead, at policies, and outcomes. And it's striking. Reagan's big tax *cut* was 1981. Look at that graph on the Powerline post. Unemployment went *up* for another two years *after* Reagan's big tax cut! Then, in 1982, there was an in income tax increase. Then in 1983, an increase in payroll tax. Only then did unemployment start to decline. President Reagan was many things, but he wasn't Mandrake the Magician. It was the policies, whatever they were, that had this effect. The same truth is striking in the Bush 41/Clinton early 1990s. Tax increase, and viola! economic recovery. This does NOT mean that increasing taxes makes us all wealthier. And even if it did, there are serious personal liberty issues about the way the state takes and spends the result of our individual effort. But within the (fairly narrow) framework of late capitalism and fiscal policy, you have to admit that Clinton's track economic record is slightly more impressive than Pres. Reagan's on conservative hot button issues: overall tax stability, reduce G as % of GDP, sustained economic growth and a booming stock market. (That last is a tip-o-the-hat to Mr Luskin, who obviously cares very much about the well-being of the investor class). In response to Mr Krugman, Mr Luskin uses laguage like 'hoodlum', 'dangerous', 'morally bankrupt', 'pretensions [of scholarship]', and 'standard repertoire of distortions, lies and sloppy economic errors.' I don't know Mr Luskin. We've never met. But he comes across more and more like the savage, alchoholic and formerly brilliant uncle left to linger, muttering, in the corner at family re-unions. He doth protest too much, and in the interests of an agenda that is being day by day revealed as having a no foundation, a cheap formation, and shoddy fixtures.

Subject: Re: Power Line blog From: Pete Weis To: Paul G. Brown Date Posted: Sun, Jun 13, 2004 at 11:31:33 (EDT) Email Address: Not Provided Message: Paul. Very good reply. You support your arguments, perhaps, better than anyone who posts on this site. When I read your posts, it's as if I'm receiving visions from the past, present and future by the Ghosts of Christmas Pasts, Present and Future - as I click on your links. Perhaps I live in somewhat of a cave, but I had never heard of this Luskin character until I visited this site. I peruse a lot of sites dealing with the markets and economy, but don't remember ever seeing references to him, let alone links to his site. This indicates to me that his audience is rather small and whatever economic/political authority he has is of little consequence. On the other hand, I constantly, come across references and links to Krugman even on very conservative investment sites. I wonder if this Luskin vs Krugman thing is really non-existant or would it be more comparable to Pee-Wee Herman vs Joe Fraser? Maybe I'm wrong - what mainline (conservative or otherwise) publications does Luskin contribute to which would give him a large audience?

Subject: Re: Power Line blog From: Pete Weis To: Pete Weis Date Posted: Sun, Jun 13, 2004 at 13:23:33 (EDT) Email Address: Not Provided Message: After visiting Luskin's blog site, I see he writes extensively for the 'National Review'. He lists many sites which link his site but all of them seem to be other conservative blog sites like his own. I often read stuff by conservative economists. John Makin of the American Enterprise Institute is someone whose commentary I sometimes read. AEI is associated with the Brookings Institute. These sites list the credentials of the people who contribute to their commentary. I couldn't find credentials for Donald Luskin listed on the 'National Review' site (nor could I find it for any of their contributers). I'm familiar with Larry-the-market-is-always-going-up-you-know-me-I'm-always-positive-Kudlow and some of the others. What credentials does Luskin have with regard to economic/market issues?

Subject: Re: Power Line blog From: Bill Provost To: Paul G. Brown Date Posted: Sun, Jun 13, 2004 at 09:02:35 (EDT) Email Address: bjprovost2000@yahoo.com Message: Thanks for the reply. You make good points on item a). However, item b) is unpersuasive. Reagan can't be held responsible for the 8.7% middle quintile payroll tax rates of 1980. He didn't even take office until the following year. After hitting a peak of 9.2% in 1981 (again, BEFORE Reagan's tax cuts took effect), those rates drop off to 6.6% by the end of his term. Clearly, Reagan did not raise payroll tax rates on the middle quintile as Krugman claims. Why did Krugman only look at tax rates for families with children? If you look at the effective rates for all households in the middle quintile, they went down under Reagan. Income taxes went down from 8.3% to 5.9% (a significant drop) while payroll taxes rose from 9.1% to 9.7% (1981-1988). That's still a significant net drop in overall tax liability. Otherwise, good points on popularity and unemployment.

Subject: Re: Power Line blog From: Paul G. Brown To: Bill Provost Date Posted: Sun, Jun 13, 2004 at 15:34:00 (EDT) Email Address: Not Provided Message: Hey Bill! First, I am puzzled why we are all so focussed on that middle quintile. It represents only 20% of the nation's households. If we're dividing the households into an upper, middle and lower band of income distibution, and we're going to allow that the 'middle class' make up the majority, then we really ought to be looking at the second through fourth quintile. Second, I don't know why Krugman focussed on 'Households with children'. My opinion (for what it's worth) is that doing so was a mistake. His case--and mine now that I have choosen to take it up--can be made on the more general numbers. The case goes like this: the point is not that 'Taxes rates did not fall under Reagan'. Looking again at that series from the CBO, the overall tax burden fell across all income groups. But the point is that Reagan has the reputation of being a great tax cutter, and his status as a conservative icon rests at least in part on this perception. Justifying it requires showing that he cut taxes to a greater degree than other presidents, and his status as a conservative icon requires showing that the effect of this tax cut was to reduce the size of government as a proportion of the nation's GDP. But the data tells another story. Looking at the Clinton presidency (1993 through 2001) we see that under Clinton, tax rates also fell, and at rates that were comparable to Reagans. For giggles, I've reproduced a table below. This is arrived at by subtracting the Effective Federal Tax Rates for All Households figures in the first year of the relevant administration (1981 for Reagan, 1993 for Clinton) from the last year (1989 for Reagan, 2001 for Clinton). Reagan Clinton First(Low) -0.4% -2.6% Second -0.8% -1.9% Third -1.3% -2.1% Fourth -1.6% -0.9% Fifth(Top) -1.7% 0.0% And look, even these numbers are kind of deceptive. Clinton taxed the top quantile at a peak rate of 28%, which was more than 1% higher than anything under Reagan or Bush I. But is Reagan's reputation as a great tax cutter deserved? Well, only if you allow Clinton the same. And this brings us back to Luskin. Rather than engage in the argument, he engages in what my military friends call 'chicken-shit': find a picayune and peripheral problem, magnify it, and blend in a little abuse for good measure. Now, if you want to see a real tax cutter in action, look at Bush 43. I don't have the detailed data to hand, but George W. Bush has moved decisively to cut income tax and corporate tax rates across the entire spectrum. But what data I do have to hand tells a sad story if you're someone who believes that cutting taxes is a means, not an end. The goal is to reduce the size of government as a proportion of national economic activity. This is what Grover Norquist and his friends ultimately want. And ironically, it's what they got under Clinton. For those of you who follow what the left in this country writes about policy, Clinton's policy mix wasn't very popular in this regard. Their dissatisfaction led to the Nader/Green insurgency in 2000, and the installation of Bush 43. Anyway, the narrow point is that Luskin et al. simply aren't debating in good faith. Was Reagan a great tax cutter? No. He was about as effective as Clinton in this regard, and much less effective than Bush 43. Was he the epitomy of conservative economic policy? No. Government grew under Reagan. By contrast, the size of government contracted under Clinton. Krugman's point is that hagiography is fun, but only in small doses. Hope this helps

Subject: Energy Policy (long) From: Pete Weis To: All Date Posted: Sat, Jun 12, 2004 at 16:25:05 (EDT) Email Address: Not Provided Message: Paul Krugman wrote a brief editorial on May 7 entitled 'The Oil Crunch'. We've been having a lot of discussion on this board recently about whether offshoring is a real problem. Myself along with others (Mik, David E) have been saying it's a real problem due to what we believe will be its rapid advancement and that it will exacerbate other very real problems such as record debt and the ability to service it. But Paul Krugman makes a point in the editorial mentioned above which I believe is so true: 'In a way it's ironic. Lately we've been hearing a lot about competition from Chinese manufacturing and Indian call centers. But a different kind of competition - the scramble for oil and other resources - poses a much bigger threat to our prosperity.' Recent revelations regarding Royal Dutch Shell restating, significantly downward, its previously reported proven oil reserves may prove to be more of an oil industry wide problem. I recently read a story suggesting Chevron Texaco may be doing something similar. The story made the point that during the last six years Chevron Texaco has been steadily reporting ever higher proven reserves all the while its actual production has been dropping. The story suggested that reporting increasing 'proven' oil reserves keeps Wall Street analysts and investors satisfied. We are all aware of what this kind of activity has led to in the recent past - nasty surprises. There have been recent stories in the New York Times with regard to production problems with the largest oil fields in the Middle East - especially Saudi Arabia. The BBC in a June 7 article entitled 'Is the world's oil running out fast?' begins with: 'If you think oil prices are high at $40 a barrel then wait till they are four times that much.' 'This is the message from the Association for the Study of Peak Oil (ASPO).' 'The group of oil executives, geologists, investment bankers, academics and others warning the world of high oil prices, and the ensuing fallout, for some years now.' 'They are united by one idea, that global oil production is about to peak, which in turn will signal the permanent end of cheap oil.' 'Matthew Simmons, an energy investment banker and adviser to the controversial Bush-Cheney energy plan' stated to the BBC that 'oil is far too cheap at the moment'.. 'The figure I'd use is around $182 a barrel. We need to price oil realistically to control its demand.' The BBC article went on to say that oil industry experts and insiders told them there was no chance Saudi Arabia would be able to significantly increase output to meet increasing world demand. Asking delegates of ASPO 'whether a steep increase (by Saudi Arabia) was feasible the answers were unambiguous: 'absolutely out of the question,' completely impossible,' and '3 million barrels - never, not even 300,000.' Today Saudi Arabia produces approximately 30% of the world's oil supply (this is off the top of my head - someone correct me if this is wrong). In the late 50's and early 60's the US represented nearly 60% of the world's oil supply - then we were the sultans of oil. We also produced over half of the world's many other important commodities such as steel. So if we think America's prosperity was mostly due to 'good old American ingenuity', we should realize that there is plenty of ingenuity in Japan, China, India, Europe, etc. But having and producing much or most of the world's commodities brings wealth that is much harder to come by than with just ingenuity. However through ingenius energy policies and technological development the Japanese have been remarkable in this regard. The 70's oil problems were temporarily solved by new oil sources - the Alaskan pipeline, North Sea oil, and dramatic increases in Middle Eastern production. But this time around there will be no new major sources to come on line to meet increasing demand. Energy investment banker, Matthew Simmons (interviewed by the BBC) pretty much summed up the Bush-Cheney energy policy - 'oil is far too cheap'...'the figure I'd use is around $182 a barrel'. Well, what would oil at $182 or for that matter a sustained level above, say, $60 a barrel, do to the US and world economies? What effect would it have on interest rates and consumption? Isn't our present precarious economy based on cheap oil, low interest rates, and the seemingly, unending, ever-increasing consuming of the US consumer? What immediate effect would this have on US auto companies and all the industries supported by the US auto industry? What are Bush, Cheney and Simmons thinking? About the time the Bush administration was undergoing its secretive energy policy formulation - Cheney came out with a real 'jem' - 'the government has no role to play when it comes to energy conservation.' Cheney's energy policy clearly entails charging US corporations and the US public up the whazoo for energy with little else to go with it. This is truely 'future shock'. Some years ago, during my first trip to Japan, I was checking into my hotel. The hotel clerk handed me the key to my room and I was a little annoyed by the long plastic 'stick' that was attached to the key. When I reached the room, opened the door and flicked the switch - no lights. I pinned the door open with my suitcase and began switching lamps in the room to no avail. Finally another hotel guest walked by and told me I needed to push the plastic stick on my key into the slot next to the switch by the door. I did so and the room lit up - you couldn't leave the room without turning off the lights if you wanted to take your key with you. This is one of many simple ideas the Japanese use to cut energy use. We need a very strong energy policy and we need it in a hurry. We need the federal government to lead the way with energy conservation. We need to learn from the Japanese - they are way ahead of us. With minimal effort, we can cut our energy usage considerably. There is no reason to allow the usage of energy inefficient devices such as incandescent lighting. There is no reason why homes, hotel rooms, office buildings can't have electrical designs which force the lights out if you take the key with you. Alarm systems can remain on. I realize that home owners can easily defeat such systems but atleast it's a reminder that they need to conserve and it's saving them money. Computer chips placed in keys (such as we have in modern auto's as antitheft devices) can thwart homeowner's attempts to get around such systems. So many of us leave our hotwater systems set needlessly high - these systems can be designed in ways to eliminate this problem, but our government needs to direct companies who design these systems to place restrictions on how high they can be set. The government needs to get auto companies on the fast track to more fuel efficient autos before our auto companies end up in bankruptcy as they did in the late 70's - it may be too late already, but lets get them headed in the right direction, now, to minimize the damage. I know this will sound like too much intrusion by the government into our lives to some of us. But strong government action, immediately, is needed or we will begin to see much higher unemployment in our near future. Many 'experts' are telling us that alternate energy sources are stiil a long way into our future. This is absolute, total crap. Right now the US and practically every other nation on the planet can meet all of its electrical needs (and then some) utilizing wind power alone. The technology is now. Wind power is going on line across America right now and is the fastest growing energy source right now. In the 80's it cost around 28 cents per KW hour to generate electricity utilizing wind. Today through improved technology it costs about 4 cents per KW hour. One major problem with uneven sources of energy like wind and solar power was energy storage to handle peak demand. That is now being solved by new technologies already going online, such as large vanadium redox battery systems which are replacing power substations in places like Moab Utah. Our power grid can be decentralized and broken into much smaller segments making regions more self sufficient and much less vulnerable to sabotage or simple equipment failure. The cost of developing wind generating systems is much less than building power plants with attendant substations. Wind, solar, and tidal power will gradually become our new dominate forms of energy - it's inevitable. But the goverment needs to take a very active role in speeding the whole process up to avert the impending economic disaster of oil at '$182 per barrel'. The real problem, as I see it, is not the technology and its implementation - it's ready for primetime. It's, rather, the difficult transition for existing energy companies as many will be left behind - there is hundreds of billions at stake here. Somehow, we would need to find ways to soften the blow. The powers that be within the oil and energy industries would fight this tooth and nail. But if we sit back and do nothing we'll end up in much bigger trouble.

Subject: Re: Energy Policy (long) From: Mik To: Pete Weis Date Posted: Mon, Jun 14, 2004 at 18:12:15 (EDT) Email Address: Not Provided Message: Thanks for the article Pete. You know I have often got stuck on our local main highway. 18 lanes of traffic moving at a snail's pace if not parked with engines running. It's mind blowing how much energy is wasted, how much oil is burnt up for very little use. We are long over due on a change.

Subject: Re: Energy Policy (long) From: Paul G. Brown To: Pete Weis Date Posted: Sun, Jun 13, 2004 at 01:56:37 (EDT) Email Address: Not Provided Message: Long, and worth reading.

Subject: Industrial policy on the aircraft market From: Paul0 To: All Date Posted: Sat, Jun 12, 2004 at 07:56:08 (EDT) Email Address: pd0lega@wp.pl Message: Can anyone knows how to get the article: 'Industrial Policy and International competition in wide bodied jet aircraft' by E.Baldwin and P.Krugman from 1988 ???? Please Help

Subject: you site From: dan hill To: All Date Posted: Sat, Jun 12, 2004 at 01:21:18 (EDT) Email Address: dannyhill@triad.rr.com Message: it sucks

Subject: cooking the books From: byron To: All Date Posted: Fri, Jun 11, 2004 at 23:57:21 (EDT) Email Address: bluefin76020@yahoo.com Message: Once again the Bush Admin has lied and decieved the American People for political gain. Just recently it was decovered that Bush was proclaiming that terrorism and deaths were down under his watch. The actual figures were not down but up. This Admin keeps on lying and decieving and gets away with it.What's it going to take for the American People to wake up. Byron

Subject: quasi fiscal policy From: Zi To: All Date Posted: Fri, Jun 11, 2004 at 01:28:22 (EDT) Email Address: ae_mbe@hotmail.com Message: I'm so confuse about quasi fiscal activities what that mean ? an example for quasi fiscal? and how effect to fiscal sustainability. pls. explain. thank you so much.

Subject: Harvard's Biggest Campus Agitator From: The Dude To: All Date Posted: Thurs, Jun 10, 2004 at 20:24:16 (EDT) Email Address: nma@hotmail.com Message: ... 'WSJ:You've written to Secretary of State Colin Powell and Homeland Security Secretary Tom Ridge complaining that delays in processing visas have driven down the number of applications from foreign students.Is the Bush administration hurting higher education by over-emphasizing security? Mr. Summers:If we reduced the Mickey Mouse multiple visa applications in and out for students who can quite obviously be seen as non-threats, we would do better in higher education, promote our security by promoting better attitudes towards America, and have more resources left over to monitor the risky entrants into our country. I look at a system that takes Chinese graduate students who've gone back and forth two or three times already and keeps them in China for five months when they go back for their father's funeral and causes them to fall off their scientific research projects.I just can't see what security purpose that serves.I know it slows progress in U.S. science.... WSJ:You recently announced that parents with family incomes of less than $40,000 will no longer be expected to contribute to the cost of their children attending Harvard, and that the college admissions office will intensify recruiting of low-income students.Are you moving Harvard toward what is sometimes referred to as socioeconomic affirmative action in addition to affirmative action based on race? Mr. Summers:We don't use the affirmative action in talking about admissions.We look at each individual in the whole 'context' of their accomplishments and their background...Certainly as we do that, it is very important that we look at any socioeconomic advantages or disadvantages.Some students are able to afford SAT prep courses and benefit from them;some students are not.Some students' schooling affords them opportunities to demonstrate wonderful excellence in science, music or other fields;other students's schooling does not. ... At a time when the distribution of income and wealth is becoming more and more unequal, it appears that the transmission of inequality may actually be increasing...and higher education has a great deal to do with it.'

Subject: Re: Harvard's Biggest Campus Agitator From: Pete Weis To: The Dude Date Posted: Fri, Jun 11, 2004 at 01:43:30 (EDT) Email Address: Not Provided Message: The Dude. Perhaps we're getting a bit of a return (if however tiny) of the 60's challenge to authority. For some time, I've rationalized to myself that even though The US no longer has its great store of national resources and our productivity levels can no longer make up for our high cost of labor, we still had one very great advantage - we were one of the few attractive countries to which the world's brightest would immigrate and lend their talents to keep our technological level near the top. Sadly, even this advantage seems to be slipping away. Cudos to Harvard for providing a free education to students from families who make less than $40,000. However, they'll need to provide substantial financial aid to students whose families make less than 100,000 (perhaps 150,000) if they want to retain the academic quality of their student body. It's amazing to see the competition to get into state universities (especially the better ones) simply because of the very drastic differences in tuition costs between public and private universities. This can only get worse as lower to upper middle class budgets get squeezed by higher living costs. They simply can't, or don't wish to afford the $35000-$45000 annual costs (even with decent scholarships). Graduate school is, of course, even worse. It's becoming more difficult for even the best private universities to compete for the best talent when tuition at a state university runs $20000-$25000 less per year.

Subject: supply side tax cuts From: Alex To: All Date Posted: Thurs, Jun 10, 2004 at 14:45:54 (EDT) Email Address: sztuden@yahoo.com Message: Lindsey and Barro have made the argument that while no respected economist believes that the Kennedy and Reagan tax cuts were self-financing, the tax cuts for upper income individuals were completely self-financing (due to their original higher marginal rates). Are you aware of any literature refuting this claim? Lindsey (in the Growth Experiment) has argued that to the extent that (the Reagan and Kennedy) tax cuts have increased the deficit, the culprit has been cuts for the lower and middle income individuals, where marginal rates are already much lower, thus minimizing the behavioural effects of a tax cut. (that's not to say that such cuts are a bad idea of course...) How does this square with the oft-repeated assertion that during Reagan's era, labor, or work effort, was not affected by tax cuts? How can we explain both the supposed surge in income inequality during the 80's AND the claim that tax cuts for the wealthy were not self-financing and added to the deficit? If the former is true, the dramatic increase in income for such people would no doubt have also led to a dramatic increase in tax payments as well and should not have lead to higher deficits... Alex

Subject: Re: supply side tax cuts From: Amanda To: Alex Date Posted: Thurs, Jun 10, 2004 at 15:36:32 (EDT) Email Address: Not Provided Message: Wait! I don't understand your last statement. How does tax cuts have anything to do with increased income? Tax cuts mean that less of your money is taken away by the government, but it doesn't follow that tax cuts increase income even for the higher tax brackets. And, I am absolutely no economist, but the problem with supply side economics seems to be the myth that if you give money to the rich, they spend it, invest it, etc etc and it trickles down to the poorer people. And the economy booms so much that deficits aren't a problem. But what happens when the economy doesn't experience a big enough boom to grow itself out of the deficit? The problem is that tax cuts for the rich DECREASES revenue that the federal government receives. Less money requires you spend less. But what if you don't spend less? Then you have deficit. Bush 41 was right. Reagan's economics was nothing more than voodoo economics.

Subject: Re: supply side tax cuts From: Alex To: Amanda Date Posted: Thurs, Jun 10, 2004 at 15:48:39 (EDT) Email Address: sztuden@yahoo.com Message: income dramatically increased for the rich over and above the size of their tax cuts. according to lindsey, it increased so much that rich people actually paid more in taxes (or the same) than they would have if taxes had not been cut. please cite me a condradictory study or show me contradictory numbers focusing on the effect for the deficit of tax cuts for upper income people, not overall. thank you.

Subject: Re: supply side tax cuts From: Paul G. Brown To: Alex Date Posted: Thurs, Jun 10, 2004 at 18:21:36 (EDT) Email Address: Not Provided Message: I've not read Mr Lindsey's note (does anyone have an on-line citation), but I fear he may be post hoc, ergo proctor hocing. The aggregate income of 'the rich' (say, top 1%) may well have increased after the 1981 tax cut, and it might well have increased by enough that the total tax take from the top 1% increased. But that doesn't mean that the increase in income was caused by the tax cut. We have a counter example: in the late 1980's and early 1990's we saw an increase in tax rates on the top end. If I read this report right (See page 5, Figure 3C), income at the top end continued to increase at a faster clip than it increased in other income brackets (although the difference was not nearly so profound as it was from 1980-1992, see Figure 3B). So: at a glance, the evidence that the 1981 tax cut on high income brackets led to the increasing income at the high end is at least balanced by the evidence that an increase in taxes at the high end in 1992 was followed by another period of rising income inequality. There are quantitative differences, but I don't see a lot of evidence of a significant qualitative difference. Can anyone supply some more evidence?

Subject: Re: supply side tax cuts From: Alex To: Paul G. Brown Date Posted: Thurs, Jun 10, 2004 at 19:03:04 (EDT) Email Address: sztuden@yahoo.com Message: I think the article cited lends support to Lindsey's position. The article makes clear that the trend of rising income inequality began in 1981 (page 7) after 15 more or less stable years. (1981, not coincidentally, marks the year of the tax cut act.) Moreover, the trend of rising income inequality which took off in 1981 stabilized around 1993 (page 8 towards the end).

Subject: Re: supply side tax cuts From: Paul G. Brown To: Alex Date Posted: Thurs, Jun 10, 2004 at 20:57:33 (EDT) Email Address: Not Provided Message: Granted that the growth of income inequality has slowed slighly since 1993. Nevertheless, after a tax increase on the wealthiest, they still got wealthier. Also, you'll note that the Figures 3 A & B show rates of growth over 12 year periods, while 3 C shows growth over a 4 year period. And while Figure 7 is interesting, it is the only statistic in the whole damn paper that covers the period 1993-1998. All of the others are '67 through '98. Why the difference? And they make a point of not drawing any conclusions about impact of taxation on income inequality: an entire section on pp. 9-10 with the title 'How Do Taxes Affect Income Inequality?' essentially says nothing about the question. But again, the rebuttal I'm making is fairly narrow. I'm not denying the increase in income inequality. I'm only saying that the facts Lindsey lays out don't unambiguously support his conclusion. I mean, Reagan increased taxes on the wealthy again in '82, and the biggest growth in top bracket incomes occured after that change. In the 1980's, the rich began getting richer faster than they had before. The trend continues. But there are alternative hypothesis to Lindsey's: productivity improvements, loss of manufacturing jobs, changes in social policy. The paper more or less makes that case on page 10.

Subject: Look for a rebuttal here From: David E... To: Alex Date Posted: Thurs, Jun 10, 2004 at 19:43:43 (EDT) Email Address: Not Provided Message: Brad De Long has 125 references to Larry Lindsey. This site only has 4. Maybe you will find it there. link http://www.google.com/search?sourceid=navclient&ie=UTF-8&oe=UTF-8&q=site:www.j-bradford-delong.net site:www.j-bradford-delong.net 'larry lindsey' Larry Lindsey does not have my respect. Presidential candidate Bush's plan to save Social Security with savings accounts had a hidden kicker. The savings accounts earnings were going to be skimmed to save social security. That is a bad faith proposal, made only to win election votes.

Subject: Re: Look for a rebuttal here From: Pete Weis To: David E... Date Posted: Fri, Jun 11, 2004 at 00:37:58 (EDT) Email Address: Not Provided Message: Other factors leading to the income gap involved the troubles of the steel, auto, and textile industries going into the 80's. Workers were forced into concessions and took the brunt of corporate operating cuts. Reagan effectively broke the bargaining power of the unions. However, the 80's were a decade of rising stock markets and just as they did in the nineties, executives of the 80's gave themselves lucrative stock options and ever higher salaries. In contrast worker wages and benefits rose very little. Remember also the very high rise in social security tax that fell heavily on those with earned income and not on investment income.

Subject: Re: Look for a rebuttal here From: El Gringo To: Pete Weis Date Posted: Fri, Jun 11, 2004 at 21:07:36 (EDT) Email Address: nma@hotmail.com Message: 'Inequity and Conflict Inequities hamper economic development and lead to other problems as well, such as social instability. In recent years, social instability and armed conflict have been associated with rising income inequality and growing resource scarcity. In Indonesia, mobs have burned factories and cars to protest grievances ranging from land disputes to pollution from shrimp ponds. In the Philippines, Muslim rebels are most active in western Mindanao, where the wealth gap between that region and the capital Manila is as great as that between the Republic of Korea and Bangladesh [20]. There is a close correlation between the stronghold areas of the guerrilla movement in Peru and the areas suffering greatest poverty. Further, the Zapatista rebellion in the southern Mexican state of Chiapas is largely attributable to grossly inequitable patterns of land tenure and the inability of peasant farmers to subsist on their small, degraded land holdings [21]. Many governments are responding to the economic and security threats posed by growing income inequities. In the early 1990s, for example, the Chinese government targeted 80 million people living in poverty, mostly in villages in the western areas of the country. It gave priority to ensuring adequate supplies of food and clothing. By 1996, 22 million people had been lifted above the national poverty line [22]. In the longer term, reducing income inequality and ensuring adequate human development for all is likely to depend on greater commitment to the implementation of policies for broader-based economic growth and poverty reduction through increased investment in public education and health. (See Urban Growth.) ' http://www.wri.org/wr-98-99/econgrow.htm

Subject: Why some people should not vote From: EZ To: All Date Posted: Thurs, Jun 10, 2004 at 12:00:57 (EDT) Email Address: ejz23@yahoo.com Message: I just wanted to share something I read in the Washington post Today titled, 'Economy Provides No Boost for Bush' 'For Bush, that sensitivity to foreign affairs is not all bad. Maria Sandoval, an elderly Democrat in Colorado Springs, has had a rough time of it in the past few years, living solely on Social Security and relying on the county clinic for her health care. On the economy, Bush 'hasn't done very good,' she allowed. He could have offered more help, she said, and his prescription drug law does not promise her much, either. But Bush has her vote, she said firmly. 'I guess he hasn't put too much into [the economy], but he's busy with a lot of other things. He's on top of everything. That's what I like about him.' During the Clinton years, Jeremy Tuck said he had been selling mobile homes in Tuscaloosa, Ala., and, at $45,000 a year, making good money. Last year, he was assembling mobile homes, earning $15,000 and living hand-to-mouth. But Bush has his vote this November. Had Gore been elected in 2000, Tuck said, 'we would've been taken over by Saddam Hussein or [Osama] bin Laden.' 'You make more money in plain terms when Democrats are in office,' Tuck said with a shrug, 'but Republicans are stronger on the military, and that's why I'm voting for President Bush.'

Subject: Re: Why some people should not vote From: Bobby To: EZ Date Posted: Sat, Jun 12, 2004 at 05:40:32 (EDT) Email Address: robert@pkarchive.org Message: 'Had Gore been elected in 2000, Tuck said, 'we would've been taken over by Saddam Hussein or [Osama] bin Laden.'' What scares me is that anyone could believe such b.s. There do exist scenarios in the war on terror that are completely irrelevant to formulating proper strategy at present, and the above is one of them (and Saddam really wasn't a major threat or part of the war on terror). It really shows that many people are not willing to take the threat seriously. As much as bin Laden et al. would like to do so, the threat is not that they will take over the world as Hitler would have without a military response in World War II, but that they will continue to launch attacks on innocent people, especially in the U.S. For the time being, the worst case scenario for the U.S. is not that the U.S. government will be overthrown and replaced by an Islamist regime (no other government, much less terrorist group, has the technology to overthrow the U.S. government), but that New York and possibly other cities as well will be destroyed or rendered uninhabitable by a nuclear or biological terror attack. In the very long run, the war on terrorism may not even look like a war or be directed only at Islamist terrorism specifically. In general, we must create a proper government effort to stay one step ahead of the kind of technological change that makes it cheaper and feasible for discontented small groups or even individuals to acquire without detection the means to kill unspeakable numbers of people. Instead of repeating myself, I'll just repost this post on what we actually should be doing in the war against terrorism. I think it's contents apply to combatting both the long run and very long run threats: The war on terror is not a war like WWII or Vietnam. If it is a war, it is one in the sense that the Cold War was a war (this analogy is helpful since the claim that dissent 'helps the enemy' has far less credibility in a Cold War-like war, as opposed to a WWII-like war). In the long run, in order to beat Islamist terrorism, we have to win over the hearts and minds of people in the Muslim world, and we're going in the exact opposite direction now. 'Taking the fight to the enemy,' which is more of a slogan than a thought out strategy can't be our only line of defense as it is with Bush. It definitely should not be carried out in the fashion Bush has done, which creates terrorists and support for them faster than we can kill them. We need in general at least three lines of defense, almost all of which are being ignored. Foremost we need a program at home to detect and prevent attacks on large populations within our country, especially in urban centers like NYC. This should be our last line of defense. In general, this would involve taking our scarce resources out of Iraq for now and put them into port security, repurchase of nuclear fuels overseas (including not only former Soviet republics but also India and Pakistan and maybe Iran), new technologies to detect chemical and nuclear weapons, and metal detectors in crowded areas, chemical detectors, and other securty measures to defend us at home, especially in our cities, and especially New York. Then our second to last line of defense should be port and border security (for WMD and terrorist-detecting purposes, not anti-immigration ones). Our first line of defense should involve espionage, cooperation, cooption, and infiltration of foreign intelligence, and covert operations in foreign countries to detect terrorist, plots, and WMDs that can be used against us. This requires cooperation with Muslim countries, which includes the public support from their general populations for our actions. This is made far more difficult if the populations of these countries hate us because of unnecessary things that offend them like our Iraq venture. This first line of defense is really the only sense in which we should be 'taking the fight to the enemy,' whereas occupation, like in Iraq, is an extreme measure for extraordinary circumstances. Iraq really does not apply to this though Afghanistan was necessary. Ironically, this first line of defense will likely take the longest to create, and it is made longer by our current occupation of Iraq. Port security and protection of concentrated populations is difficult, but at least something acceptable can be put in more quickly if we spend more money. Improvements in such a system can begin sooner if we make this system more quickly. Sadly Bush is wasting our resources on Iraq and highly regressive tax cuts. By pissing off the Middle East right now he is making an attack here at home more likely, and they have far more adherents willing to participate in it due to our actions in Iraq. But compared to what we need, we have very little in place to defend us due to Bush's neglect.

Subject: Defending Mr. Tuck . . . From: Paul G. Brown To: EZ Date Posted: Thurs, Jun 10, 2004 at 15:44:52 (EDT) Email Address: Not Provided Message: > 'You make more money in plain terms when Democrats are in > office,' Tuck said with a shrug, 'but Republicans are stronger > on the military, and that's why I'm voting for President Bush.' Whether or not the Repubs or the Dems are 'stronger on the military', and whether or not 'you make more money ... when Democrats are in office', Mr Tuck has here expressed a sentiment I respect. There's a biblical injunction: 'What does it profit a man if he gains the whole world, but loses his soul?' (Mark 18:36, also in Mathew & Luke). There's a lot to be said for non-material measures of human progress; morality, the character of the body politic, culture. What Mr Tuck is saying is that cares about something more than money. I actually like that in a person. All of our economics only gets us so far. It used to be that progressives had the morality argument on their side. Suffrage, Civil Rights, and so on. But now morality has been turned into a contest between negative visions of human potential, rather than positive ones.

Subject: Re: Defending Goethe... From: El Gringo To: Paul G. Brown Date Posted: Thurs, Jun 10, 2004 at 17:16:46 (EDT) Email Address: nma@hotmail.com Message: The basic plot of 'selling one's soul to the devil' for power over the physical world took on increasing importance and became a metaphor for the victory of technology and industrialism and its human cost....

Subject: Re: Defending Mr. Tuck . . . From: EZ To: Paul G. Brown Date Posted: Thurs, Jun 10, 2004 at 16:36:13 (EDT) Email Address: ejz23@yahoo.com Message: Paul G. Brown your quote was very interesting, yet very irelavent, Mr. Tuck said 'we would be over run by Saddam and Osama' First, Saddam was never a threat, even Bush now admits that. And if Tuck was so scared of Osama, why is he not scared that we have not found him and have no intention of finding him as we have moved most of our resources out of afgahnistan to concentrate on Iraq.

Subject: Re: Defending Mr. Tuck . . . From: Paul G. Brown To: EZ Date Posted: Thurs, Jun 10, 2004 at 17:00:33 (EDT) Email Address: Not Provided Message: Oh I have not a whole lot of sympathy with Mr Tuck on that point. I'm as ticked at Bush 43 as anyone. But I was intrigued by the last quote. Mr Tuck acknowledges that he's voting against his narrowly defined self-interest. That's a purple cow; always curious to see one.

Subject: Re: Why some people should not vote From: Amanda To: EZ Date Posted: Thurs, Jun 10, 2004 at 13:50:07 (EDT) Email Address: Not Provided Message: Republicans strong on national security is just a myth. Just like the myth that they are better with the economy and managing our federal deficit, and wars and military, etc. etc. etc. According to recent numbers soon to be re-released by the State Department (the first time, they miscounted, idiots, and called a press conference to announce that they were making the world safer against terrorism) incidents of terror are up in the world, speculation could be that this year saw the highest numbers of terror incidents ever! So according to Daily Kos, he asks: When they refigure the numbers will they again call a press conference to announce that the Bush Administration has made the world more unsafe? Incompetant, lying idiots, all of them.

Subject: Re: Why some people should not vote From: RL To: Amanda Date Posted: Fri, Jun 11, 2004 at 05:37:48 (EDT) Email Address: rafaelloring@yahoo.es Message: I find the article tendencious. As many of you I despise Bush but to picture some Bush voters saying nonsense is unfair. It would be very easy to pick up some kerry's voters saying stupidites and then say 'why some people should not vote', a plain fascist statement. If you judge voters reasons don't surprise your self if your government thinks it's own people is wrong and acts contrary to its wishes.

Subject: What happens on the NYT columns? From: Min To: All Date Posted: Thurs, Jun 10, 2004 at 11:15:25 (EDT) Email Address: cyoyomil@hotmail.com Message: I could not find those before Oct.01. They were there just a few weeks ago, and I decided to read it later when I have time--I just discovered this site a month ago. Could anyone tell me what happens to them, and better, where to find them (other than purchasing it from NYTimes?) Thanks.

Subject: Re: What happens on the NYT columns? From: Bobby To: Min Date Posted: Sat, Jun 12, 2004 at 03:55:52 (EDT) Email Address: robert@pkarchive.org Message: My God! It appears my computer or the piece-of-shit file transfer device erased the bottom half of my columns index. I repaired it, and all The NYT columns are there. I'm truly sorry, and I'll check every time now to make sure that the bottom of my index pages aren't cut off when I upload them.

Subject: Great Site Bobby! Thanks 4 your Hard work. n/m From: David E... To: Bobby Date Posted: Sat, Jun 12, 2004 at 12:06:33 (EDT) Email Address: Not Provided Message: n/m

Subject: Re: What happens on the NYT columns? From: Min To: Bobby Date Posted: Sat, Jun 12, 2004 at 10:50:43 (EDT) Email Address: cyoyomil@hotmail.com Message: Thank you so much for your reply, and for collecting all those fabulous archive articles.

Subject: Re: What happens on the NYT columns? From: El Gringo To: Min Date Posted: Sat, Jun 12, 2004 at 19:59:34 (EDT) Email Address: nma@hotmail.com Message: Bobby, we all love you, thanks!

Subject: Toyota Prius and the Trade Deficit From: Neo-Solow To: All Date Posted: Wed, Jun 09, 2004 at 23:17:22 (EDT) Email Address: nma@hotmail.com Message: Greater reliance on Middle East ' is inevitable' by Sheila McNulty in Houston Lee Raymond, head of ExxonMobil, the world's biggest publicly listed oil and gas company, expects the US and the rest of the world to become increasingly dependent on energy from the Middle East. 'This is not a matter of ideology or politics.It is simply inevitable.'Mr Raymond told the Woodrow Wilson International Center for Scholars in Washington DC.We periodically hear calls for US energy independence, as if this were a real opinion' he said.'The fact is that the US is a part of the world energy market, and we must participate and we must compete in that market.' He said the US did not have the resource base to be energy dependent.Neither did it have guaranteed supply rights to the energy it needed from abroad. So the US needed to think carefully about the nature of its relationships with countries in the ME, as well as other regions that would be increasingly important as suppliers including those in sub-Saharan Africa (Nigeria?), Russia, Central Asia and Venezuela (Chavèz?) Even as these other regions added to the world's resource pool, he said there were industry estimates that about half of proved worldwide oil and gas reserves were in the ME, with Saudi Arabia 'alone' (Iraq ?) having about one-fifth of the world's reeserves. 'We need to accept the reality of this, rather than undertake expensive and risky (remembering Rodin...) steps trying to avoid it', Mr Raymond said.Especially since, he noted, worldwide energy needs were going to go up rather than go down.ExxonMobil(e) estimates global energy use will increase about 40% by 2020 (In the year...), as demand rises from about 215m oil equivalent barrels per day to almost 300 oil equivalent b/d.That translated to nearly 13bn per day, he said, underlining the fact that the world's energy system was arguably the world's largest industry. Though he saw a place for alternative fuels, Mr Raymond believed fossil fuels, including coal, oil and natural gas, would provide about 80% of the energy used in 2020 and increase by 65m oil equivalent b/d.That was close to eight times Saudi Arabia's current crude oil production. Meanwhile, non-fossil fuel use would only increase by about 8m oil equivalent b/d.That was because current technology made oil and gas both the least expensive and the most versatile.'

Subject: Re: Toyota Prius and the Trade Deficit From: Pete Weis To: Neo-Solow Date Posted: Thurs, Jun 10, 2004 at 00:26:43 (EDT) Email Address: Not Provided Message: Greater reliance on the Middle East is one thing. Whether or not the Middle East can deliver is quite another. It's likely the Middle East can't come close to delivering - especially the numbers Raymond is quoting. Raymond is worried about the way things are headed in the Middle East and he should be. The BBC recently quoted oil industry experts/insiders saying if oil were presently 'fairly' priced it would be set at $180-$190 per barrel - not sure how they came up with that number. Alternate energy sources will soon become an extreme necessity as oil prices really start to rise in the coming decade - prices have not really started to rise much yet and we will think of $40 a barrel as a fond memory in not too many years. Mr. Raymond's company will surely benefit from those increases. But he better start changing his 'opinions' about alternate energy sources or his company will end up like Kodak and Zerox.

Subject: knowledge economy From: lutao ning To: All Date Posted: Wed, Jun 09, 2004 at 09:01:04 (EDT) Email Address: ln227@cam.ac.uk Message: Has Paul Krugam spoken about Knowledge economy? thanks

Subject: Re: knowledge economy From: El Gringo To: lutao ning Date Posted: Wed, Jun 09, 2004 at 15:43:40 (EDT) Email Address: nma@hotmail.com Message: What is the current 'definition' of the Knowledge economy ?

Subject: another question From: Jack To: All Date Posted: Tues, Jun 08, 2004 at 22:16:05 (EDT) Email Address: jjlwmd@yahoo.com Message: The responses posted to my last question were quite good, even if one or two of them went over my head. This leads me to ask another question that I've always wondered about: How much does high risk investment contribute to economic growth? The reason I ask is this: federally insured banks are regulated (well, usually) in such a way that they are not permitted make high risk investments due to the moral hazard such an allowance would (and in some cases of such deregulation has) lead to. So I assume high risk investment is left to private investors. But how important is high risk investment to the economy? Is it more detrimental than beneficial to growth? If that is true, than why allow it at all? I'm asking this question from an economic/utilitarian point of view, with no intended regard to rights and liberties (that's another by no means irrelevant question). Thanks again

Subject: Re: another question From: Mik To: Jack Date Posted: Wed, Jun 09, 2004 at 17:06:31 (EDT) Email Address: Not Provided Message: Interesting question. I don't think there is detriment to any economy to have an element of high risk investments. Normally the portfolio of investments comprises of both high and low risk investments. High risk tend to offer high rewards and vice versa for low risk. So there should be some high risk investments. I now have a problem with the defintion of risk though. In my opinion there is a huge problem with understnaidng risks. What one financial institution may see as an 'okay' investment another institution may see it as 'high risk'. So this topic is in my opinion some what subjective.

Subject: Risky business From: Paul G. Brown To: Mik Date Posted: Wed, Jun 09, 2004 at 22:44:28 (EDT) Email Address: Not Provided Message: Sorry about the Subject. Couldn't resist. Wipedia, as usual, has some interesting things to say about Risk.. Google also hacks up a lot of useful hairballs: search under 'Risk Analysis Mathematics' or somesuch. Several good schools have lots of course-work on-line. And if you're the reading kind, Peter Bernstein's Against the Gods: The Remarkable Story of Risk is really good. It explains the mathematics of risk in a historical context. And if the Bernstein book whets your appetite, you might consider this dense tome by Ralph Vince. Like it says in the title, you're gonna get a little math with that. In a nutshell, the study of risk and economic return doesn't fit into a nutshell. It's a *huge* topic, but the overall goal is to get as much subjectivity out of risk assessment as you can. On the OP's questions: It's strikes me that it's very hard, in principle, to extrapolate from the micro-economics realm where risk is typically considered, into the macro-economic realm of your questions. Risk decisions in a free market economy are made every by a very large number of individual decision makers. Some pay off. Many don't. But overall, few opportunities go unexplored. Less risky ones get taken early, with riskier ones attracting fewer takers. And that's the genius of capitalism.

Subject: Re: Risky business From: Mik To: Paul G. Brown Date Posted: Mon, Jun 14, 2004 at 18:35:27 (EDT) Email Address: Not Provided Message: Paul, I only picked up to this now. I did quite a bit of reading on risk analysis for toll road projects in developing countries. Just about every second boffin tries to put numbers to some very subjective factors. Risk of slope failure (engineering), risk of business failure (financial) and risk of currency failure (economic) to name a few. And when all else fails they introduce a 'MAGA' clause (Material Adverse Government Affect). I once went through the list of risks and (indicator figures) prepared by an investment banker. The list was just never ending and it was in my opinion ridiculous. Under those risk catogories the project would never have gotten off the ground in the first place. Luckily another investment banker came around with a whole different take on the concept of risk - and what do you know, the project took off. Who was right between the two? We'll actually only know in about 30 years (once the concession comes to an end). But one thing is for sure, I could apply the same risk analysis prepared by the first Investment Banker to many projects such as the Golden Gate Bridge (which I did to make a point) and we'd find that the Golden Gate should never have been built. Looking back, the Golden Gate Bridge turned out to be a sound investment. You make the statement about how few opportunities go unexplored. I couldn't disagree with you more. There are literally thousands of business opportunities in developing countries that are still waiting to be explored. The major problem is that risk models as we know them are still centred around more controllable factors found in developed countries. So now I do agree with your other statement, this is a 'huge topic' but still far more subjective than what most can imagine. But alas your last statement is true - Less riskier projects get taken first (and if I can add) wealth in the developing world will not be truly unlocked because it doesn't fit in with 'some risk model'. And that's the genius of capitalism.

Subject: Re: another question From: El Gringo To: Mik Date Posted: Wed, Jun 09, 2004 at 21:44:29 (EDT) Email Address: nme@hotmail.com Message: 'Risk is the potential future harm that may arise from some present action.It is often combined or confused with the probabillity of an event which is seen as undesirable.Usually the probability and some assessment of expected harms must be combined into a believable scenario combining risk, regret and reward probabilities into expected value.There are many informal methods which are used to assess (or to 'measure' although it is not usually possible to directly measure) risk, and (for some applications) formal methods such as value at risk.' http://www.rodinmuseum.org

Subject: globalization From: jack To: All Date Posted: Mon, Jun 07, 2004 at 20:11:52 (EDT) Email Address: jjlwmd@yahoo.com Message: This doesn't pertain specifically to Paul Krugman, though he has written quite extensively on the subject of globalization. Following mainstream economic theory, free trade ought to lead via the mechanism of comparative advantage to increased productivity for all countries trading with one another, and hence increased living standards for all. But I have a question, one which probably stems from the fact that I have never taken an econ class, and it regards the international competition for labor. Wouldn't decreasing national barriers lead to more and more labor competition and hence falling wages for those workers in the wealthier, developed nations? The wages of poorer workers would of course increase, but how far? Would the wage rate stabalize at a point where most workers are relatively either worse off or not that muchy better off relative to their national and international standards? I know this sounds wrong, but I just want to have a pretty good answer for anyone who brings this point up to me in conversation or class. Thanks, Jack

Subject: Re: globalization From: IZ To: jack Date Posted: Tues, Jun 08, 2004 at 20:37:00 (EDT) Email Address: iz@iz.com Message: Well, this does apply to Paul Krugman because he had to deal with issue when William Grieder's One Work book came out. Greider similarly describes a global race to the bottom for wages. But wages do not work like that. Assume people in the US start buying textiles from Asia. Yes, wages in the textile industry will decline. But income among textile consumers will increase by a greater amount. The increased income will stimulate the economy...and the gains will be greater than the loss in wages in the traded sector. there is no single wage rate. Wages in industries where US workers are no more productive than Asian workers and the good is freely traded will tend to converge at some middle point. BUT...in most industries, US workers are far more productive than their counterparts and most goods are not freely tradeable. One way to think of the impact of globalization is that the impact is the same as innovation and automation. Automation puts people out of work...but improves the economy and [hopefully] the overall standard of living. A problem with manufacturing jobs is that not only are the goods being traded, but, perhaps much more important, is that the forces of innovaton and automation are exerting constant pressure on productivity in manufacturing -- essentially using fewer and fewer people to generate the same amount of output. The social problem is that our economy is very unforgiving with the minority who exist in the tradeable good. It is difficult to retrain.

Subject: Re: globalization From: IZ To: jack Date Posted: Tues, Jun 08, 2004 at 20:36:42 (EDT) Email Address: iz@iz.com Message: Well, this does apply to Paul Krugman because he had to deal with issue when William Grieder's One Work book came out. Greider similarly describes a global race to the bottom for wages. But wages do not work like that. Assume people in the US start buying textiles from Asia. Yes, wages in the textile industry will decline. But income among textile consumers will increase by a greater amount. The increased income will stimulate the economy...and the gains will be greater than the loss in wages in the traded sector. there is no single wage rate. Wages in industries where US workers are no more productive than Asian workers and the good is freely traded will tend to converge at some middle point. BUT...in most industries, US workers are far more productive than their counterparts and most goods are not freely tradeable. One way to think of the impact of globalization is that the impact is the same as innovation and automation. Automation puts people out of work...but improves the economy and [hopefully] the overall standard of living. A problem with manufacturing jobs is that not only are the goods being traded, but, perhaps much more important, is that the forces of innovaton and automation are exerting constant pressure on productivity in manufacturing -- essentially using fewer and fewer people to generate the same amount of output. The social problem is that our economy is very unforgiving with the minority who exist in the tradeable good. It is difficult to retrain.

Subject: Re: globalization From: IZ To: jack Date Posted: Tues, Jun 08, 2004 at 20:36:12 (EDT) Email Address: iz@iz.com Message: Well, this does apply to Paul Krugman because he had to deal with issue when William Grieder's One Work book came out. Greider similarly describes a global race to the bottom for wages. But wages do not work like that. Assume people in the US start buying textiles from Asia. Yes, wages in the textile industry will decline. But income among textile consumers will increase by a greater amount. The increased income will stimulate the economy...and the gains will be greater than the loss in wages in the traded sector. there is no single wage rate. Wages in industries where US workers are no more productive than Asian workers and the good is freely traded will tend to converge at some middle point. BUT...in most industries, US workers are far more productive than their counterparts and most goods are not freely tradeable. One way to think of the impact of globalization is that the impact is the same as innovation and automation. Automation puts people out of work...but improves the economy and [hopefully] the overall standard of living. A problem with manufacturing jobs is that not only are the goods being traded, but, perhaps much more important, is that the forces of innovaton and automation are exerting constant pressure on productivity in manufacturing -- essentially using fewer and fewer people to generate the same amount of output. The social problem is that our economy is very unforgiving with the minority who exist in the tradeable good. It is difficult to retrain.

Subject: Re: globalization From: IZ To: jack Date Posted: Tues, Jun 08, 2004 at 20:35:19 (EDT) Email Address: iz@iz.com Message: Well, this does apply to Paul Krugman because he had to deal with issue when William Grieder's One Work book came out. Greider similarly describes a global race to the bottom for wages. But wages do not work like that. Assume people in the US start buying textiles from Asia. Yes, wages in the textile industry will decline. But income among textile consumers will increase by a greater amount. The increased income will stimulate the economy...and the gains will be greater than the loss in wages in the traded sector. there is no single wage rate. Wages in industries where US workers are no more productive than Asian workers and the good is freely traded will tend to converge at some middle point. BUT...in most industries, US workers are far more productive than their counterparts and most goods are not freely tradeable. One way to think of the impact of globalization is that the impact is the same as innovation and automation. Automation puts people out of work...but improves the economy and [hopefully] the overall standard of living. A problem with manufacturing jobs is that not only are the goods being traded, but, perhaps much more important, is that the forces of innovaton and automation are exerting constant pressure on productivity in manufacturing -- essentially using fewer and fewer people to generate the same amount of output. The social problem is that our economy is very unforgiving with the minority who exist in the tradeable good. It is difficult to retrain.

Subject: Re: globalization From: IZ To: jack Date Posted: Tues, Jun 08, 2004 at 20:34:38 (EDT) Email Address: iz@iz.com Message: Well, this does apply to Paul Krugman because he had to deal with issue when William Grieder's One Work book came out. Greider similarly describes a global race to the bottom for wages. But wages do not work like that. Assume people in the US start buying textiles from Asia. Yes, wages in the textile industry will decline. But income among textile consumers will increase by a greater amount. The increased income will stimulate the economy...and the gains will be greater than the loss in wages in the traded sector. there is no single wage rate. Wages in industries where US workers are no more productive than Asian workers and the good is freely traded will tend to converge at some middle point. BUT...in most industries, US workers are far more productive than their counterparts and most goods are not freely tradeable. One way to think of the impact of globalization is that the impact is the same as innovation and automation. Automation puts people out of work...but improves the economy and [hopefully] the overall standard of living. A problem with manufacturing jobs is that not only are the goods being traded, but, perhaps much more important, is that the forces of innovaton and automation are exerting constant pressure on productivity in manufacturing -- essentially using fewer and fewer people to generate the same amount of output. The social problem is that our economy is very unforgiving with the minority who exist in the tradeable good. It is difficult to retrain.

Subject: Re: globalization From: Mik To: jack Date Posted: Tues, Jun 08, 2004 at 15:53:03 (EDT) Email Address: Not Provided Message: Jack, you asked a very good question. Bob has given the classic text book reply. I want to point out a few factors that the text book conveniently does not emphasize. The whole concept of importing goods (by having them made by cheaper labour) makes the goods cheaper and improves the salaries of the poor. That is a true statement. The concept of ongoing improvement in the salaries is the difficult concept simply because Economics studies apply the principle of cetris parabus - all things remaining equal. So in other words if there were, say, only two economies in the entire world, the statement would hold true. However as we have far more than two economies, the statement only holds true in the long run. This is the difficult concept now - and where I have become a pessimist. I believe what Keynes once said, 'In the long run we are all dead.' So in essence - I think you answered your own question pretty well using your logic and looking at the matter from a short to middle run period. Another issue that Bob raised is the concept of skilled labour verse unskilled labour. Now this to me is a very vague concept. I used to get involved in the measurement of productivity between skilled, semi-skilled and unskilled labour. The clear issue to me is that the concept of skilled/semi-skilled/unskilled changes over time. In the past, our grand parents were the skilled labour that knew how to make great motor cars and hence the reason why motor cars were made in the great western countries. Today BMWs are fully made in Africa. Today skilled labour tends to refer to 'white-collar' labour. And we in the west hold the skilled labour jobs, because we know how to work a computer better than people in developing countries (I think you can see where I am going with this). Well today everyone, but everyone's job is under threat of being moved to a developing country. Many developing countries can do anything and everything that we can do in the west. It's only a matter of time before someone figures out how to move the job to a developing country. In the 'long run', some sort of harmony will be reached - in the mean time we will live in a state of constant change.

Subject: Re: globalization From: RL To: Mik Date Posted: Thurs, Jun 10, 2004 at 04:47:51 (EDT) Email Address: rafaelloring@yahoo.es Message: 'we will live in a state of constant change' What a nice sentence, but isn't it the nature of economics? I hear again that now everybody's job is under threat. But it has always been that way, the difference might be that your job is now under threat of being taken by a foreigner ( by the way i may be a foreigner to you, spaniard) but do you really care where the job goes? No, what you really care is to have one. To the country what it matters is overall creation of jobs and the weel being of its population. This is without disscussion better with the more efficient open economy. As other countries get more jobs and their economies grow they also create demand for more and new goods and services. The result is yes far greater competions in all classes of jobs but a more efficient global economy (it could only be a race to the bottom if the global economy doesn't improve). As always, some will lose but overall productivity will increase. Why what it was goods for industrial jobs it is'nt for other kind of jobs?

Subject: Re: globalization From: Mik To: RL Date Posted: Thurs, Jun 10, 2004 at 15:14:10 (EDT) Email Address: Not Provided Message: Yep you have a very good point, you are typically referring to opening up trade barriers. Paul Krugman once made a quote, 'Just because your neighbouring countries' ports have been blocked, does it mean you should lose out on the porducts and block your ports?' Again, the concept you have put forward about a more efficient global economy. This is where I have a problem with my economics education. Are we really pushing towards a more efficient economy? I have just read some posts about how houses have not changed since the 1940's, Boeing 747 first flew in 1969 and the Concorde has been stopped. I think there is a serious gap between accepted economic principles and the realities of life. In reality - big companies don't like free markets and most of all they don't like competition. They want to live in a protected market, where they can continue to sell their same product for more and more money. They will do everything to undermine all attempts to secure open and free markets. When I say this, consider Microsoft, GM, Walmart, the US sugar industy, the US lumber industry, etc, etc. The biggest factor to consider is that of the world's 100 biggest economic powerhouses, 49 are companies. So on the one hand, we find companies wanting open markets for cheaper labour and reduced costs, but on the other hand they want to ensure that competition will be restricted. Quite a problem? Ahhh the beauty of economics.... the trade-offs and assessing what is good for the country. Modern economics states that over time, countries will begin to focus on markets they are good at. I think that is the biggest load of bull. Countries and Companies will focus on what makes the most profit (why is South Korea good at making cell phones and not say Holland?) And countries/companies will pull stunts to seriously damage competing foreign industries. Once the damage is done, they can return to monopolistic practices - Microsoft.

Subject: Re: globalization From: RL To: Mik Date Posted: Fri, Jun 11, 2004 at 04:11:00 (EDT) Email Address: rafaelloring@yahoo.es Message: 'I have just read some posts about how houses have not changed since the 1940's, Boeing 747 first flew in 1969 and the Concorde has been stopped.' Just check the cost in real terms of building a house(not including the cost of the land) or building an airplaine and you will see how much cheaper has become since 1940 or 1969. In the case of houses due to the problem with land (fixed resource) we don't see that they got cheaper but look at airplane tickets (even in an oligopolistic market as it is) do you think many people could afford in America to fly to Europe in 1969? what about now?. (I see from your last paragraph that you haven't catch the idea of comparative advantage, bobby has explain it quite well. Holland is probably better at cell phones than south korea not taking into account wages, but is better for holland to import cell phones from south korea and dedicate resources to produce stuff that even with the difference in wages is cheaper because is much more efficient in them. That way global resources are allocated in a more efficient way.) I share your concerns with monopolistic industries. Yes, companies push for free markets when it pays in profits and at they don't when it doesn't (as it is the case with foreign competition in their own countries). What economist should do is to push always for free markets and with more enphasis when the poor benefit from it (as it is the case with foreign competition from developing countries) and also point to the fact that some people are loosing for the benefit of most when markets are freed and so they should be helped.

Subject: Re: globalization From: Pete Weis To: Mik Date Posted: Fri, Jun 11, 2004 at 00:03:58 (EDT) Email Address: Not Provided Message: Mik. Have to agree with your idea that politics and the influence of global corporations tend to inhibit the development of an 'efficient global economy'. Witness, along with your examples, the power of large oil corporations and OPEC to influence US and world energy policies. Ultimately, existing political, economic, military, and corporate powers are replaced by new ones. And they always act to protect their own interests and thwart the actuality fundamental economic theory. Still we need evolving economic theory to put things back together when they finally fall apart. When economic dislocations occur as they did in the 1930's, economists, good economists, become our most important assets. When boom times are in place, IMO, economists seem to be mostly without real direction. A few who are bold enough to stand apart from the crowd and have the talent to perceive good times don't go on forever are rare diamonds. If they have the courage to stand apart, inevitably they are subject to abuse. So I salute Krugman, Roach, Schiller and others who challenge the status quo.

Subject: Re: globalization From: Pete Weis To: Mik Date Posted: Tues, Jun 08, 2004 at 18:25:33 (EDT) Email Address: Not Provided Message: Well stated Mik. Today we have software developers, engineers and accountants in India who are as skilled as their counterparts in the West but receive a fraction of Western wages for equivalent work. In the past it's been a relatively slow erosion of factory jobs. It was slow because moving factories overseas was an expensive ordeal and for third world countries to develop their own manufacturing capabilities, there was a need to climb a steep learning curve as well as garner some help from more developed countries. This slower loss of manufacturing jobs gave the nations, like the US, atleast some time to adapt. Still, US workers in the steel and textile industries suffered. I believe the computer age has changed the process of labor migration dramatically. The barriers that slowed the pace of manufacturing jobs migrating to cheaper labor markets are simply not there for white collar jobs. This will be a much, much faster shift in jobs between labor markets - something the world has not seen in past history.

Subject: Re: globalization From: Bobby To: jack Date Posted: Mon, Jun 07, 2004 at 23:06:03 (EDT) Email Address: robert@pkarchive.org Message: Comparative advantage says only that when trade is opened up, those goods with higher relative prices under free trade than autarky will be exported and those with lower relative prices will be imported. Moreover, under the assumption of perfect competition and a convex production possibilities frontier (which is a good approximations for most goods and most countries), the economy as a whole of a country that lets down its trade barriers can consume more of both the goods that it exports and those that it imports. One can show that the country as a whole is better off and the gains to winners are bigger than the losses to the 'losers' of free trade. However, nothing has been said about distribution of those gains. As for the distribution of income, laborers and owners of other factors of production, that are 'stuck' in import-competing industries and can't easily move to other sectors will see their income decrease as the prices of the import-competing goods they produce decrease, while those 'stuck' in export industries see their income increase. Since all factors are more or less mobile to different industries in the long run, these 'industry specific factors' can eventually migrate to industries where they will get higher income. Therefore this is usually a problem for only a few years, and it is seen as less serious than what I will say next. If a factor of production, like low-skilled labor, is employed intensively in an import-competing industry, that is the ratio of that factor to other factors employed tends to be higher in import-competing industries than in export industries, then the decrease of the import good's relative price due to opening of trade will unambiguously decrease the real wage of that factor in all industries. On the other hand, if the factor, like high-skilled labor, is employed intensively, that is a high ratio of that factor to others, in export industries, opening of trade increases the raltive price of the good it produces and unambiguously increases their real wage of that factor in all sectors. The examples of unskilled labor being hurt and high-skilled labor being helped is likely the case for the U.S. This effect on income distribution is considered more serious since it effects the real price (or wage) of the factor in all sectors so long run factor mobility does not mitigate it. However, for the U.S., the general consensus of economists from empirical evidence is that these effects are rather small. The major culprit for the growing wage gap between skilled and unskilld labor is thought to be due to the nature of the changes of production technologies. Moreover, the wage gap between the top 1% and the rest of the population is also not thought to be from trade. As for factor price equalization, the answer is that wages of foreign and American workers may converge somewhat but not nearly alll the way. The reason why is that U.S. workers are more productive than foreign laborers, because of things like better education, better infrastructure in the U.S., better quality physical capital, etc. Therefore one hour of U.S. labor maybe makes the same amount of output as ten hours of Indonesian labor. You can alter the units by saying that one hour of U.S. labor is worth 10 hours of 'effective labor,' and the U.S. wage for an hour of effective labor is therefore one tenth of the U.S.'s hourly wage. Likewise one hour of Indonesian labor is worth 1 hour of effective labor and the effective labor wage is actual the Indonesian hourly wage. Due to trade, the effective labor wage in the U.S. and Indonesia will become about the same, but the hour wage in the U.S. will still be 10X more than in Indonesia because the U.S. worker is 10X as productive.

Subject: Re: globalization From: Pete Weis To: jack Date Posted: Mon, Jun 07, 2004 at 22:26:30 (EDT) Email Address: Not Provided Message: Perhaps others, here, would care to answer your question more specificly. However, for a fairly lengthy back and forth posting on this subject click on 'View All' above and scroll down to the post entitled 'Outsourced and out of work?' You will get differing views expressed, especially in regard to the severity of the consequences of the 'competition for labor' you speak of. Like most who post on this board, I'm not an economist but have an interest in the subject. I don't think it takes a PhD in economics to realize a global supply of cheap labor will put downward pressure on wages in nations that have the highest wages. The biggest problem with this, IMO, is the related downward pressure lower wages and slower job growth puts on consumption and inflated assets (such as housing) in a nation such as the US which suffers from high levels of personal and governmental debt.

Subject: Re: globalization From: Ivan Z. To: Pete Weis Date Posted: Tues, Jun 08, 2004 at 20:24:13 (EDT) Email Address: iz@iz.iz Message: I would answer you by noting that trade continues to increase but I don't think anyone would argue that average wages in this country are declining. Moreover, with the increase in trade in the late 90's, this country had a labor shortage. So your assertion doesn't quite work out. No one would argue that the expansion of the textile industry abroad didn't put downward pressure on textile workers in the US. So in a sense -- in the narrow market for labor in the tradeable good -- the assertion is true. Trade does suppress wages...but we are talking about wages in the traded good. But in an overall sense, the benefits to trade from the availability of less expensive goods will be greater than the loss in wages. There is no evidence that trade lowers wages and slows job growth and decreases consumption and causes housing bubbles. This error is the same one made by Bill Greider in his One World book. Yet another way to think of this situation is to realize that innovation has the same impact. If you invented a machine that you could stick $20 worth of lumber in and have it spit out $30 worth of clothing...you would be a hero of capitalism....but if people found out that your machine just secretly put the lumber on a boat that went to China and traded the lumber for clothing, you might be seen as a fiend. On the issue of convergence of wages, this is discussed I believe in Krugman's undergraduate trade textbook, you need two things. One, you need foreign workers to be just as productive as US workers. The other thing you need is that the good be freely traded. That is, you can imagine a barbershop in Vietnam able to do just as many haircuts in a day as a barbershop in New York.

Subject: Re: globalization From: Pete Weis To: Ivan Z. Date Posted: Wed, Jun 09, 2004 at 01:19:27 (EDT) Email Address: Not Provided Message: The 90's were certainly quite different from the past three years. We had exploding hightech expansion - North America and Europe had software development almost to themselves - many consumers were buying their very first computer (especially the early nineties) - the internet was going from near zero to hyperspace - new software and hardware companies were starting up at an incredible rate. There weren't enough qualified people to fill the labor demand. Silicon valley became world famous as the great mecca for high paid, high tech workers. Microsoft sprinkled thousands of millionares in the suburbs east of Seattle. The stock markets boomed. I don't think there has been another time in US history when so many people became wealthier because of increasing wages and soaring stock portfolios in such a short period (maybe you can think of one). Unfortunately, the good times didn't last. The last three years have seen an overall loss in jobs. The Silicon Valley-San Jose-San Francisco is now becoming well known for the loss of several hundred thousand of jobs in a very short time. I would argue that, recently, wage increases are not keeping up with inflation. But I would also argue that the more important measure when it comes to wages is not average wages but total wages since total wages effect total consumption. There is also another very important factor - the considerable fall in the dollar which has occurred over the last 2 to 3 years. Because of the declining dollar, the wage increase numbers quoted by the government are largely an illusion. OPEC has publicly stated that part of the reason for their price hikes has been the fall in the dollar. Buffet has stated, for the first time in his investing life, he is betting against the dollar. When you say 'I don't think anyone would argue that average wages in this country are declining', IMO you are not looking at the whole picture (declining dollar, total number of jobs, etc). I'm sure there are plenty of people smarter than myself who would say real wages are declining presently. I also don't agree with the idea that less expensive goods (due to competing trade) will be greater than the eventual loss in wages. A lot of economic theory seems to fall apart when it buts heads with the real world. Look at what is actually going on. Sure we are paying less for clothing, computer equipment and electronic products, but we are paying much more for the necessities in life - food, insurance, energy, shelter, etc. Down the road, most of us will need to be more selective about what we spend our wages on - guess what gets illiminated from our monthly budgets. Perhaps there is just alot more to this economic model than cheaper products offsetting lower wages. Maybe the economic model which accurately describes what is happening now has not yet been formulated. Finally, I would just like to say that the 90's are now a distant memory and this offshoring problem is really just getting underway.

Subject: Re: globalization From: Mik To: Pete Weis Date Posted: Wed, Jun 09, 2004 at 17:01:20 (EDT) Email Address: Not Provided Message: Pete, good response there. I was about to have a go at Ivan on the productivity issue but see you responded well. I particularly like your response on speed in relation to the moving factories vs the moving of white collar jobs. I just want to add a little clarity to the issue of productivity. Some time back I watched a press release about how the US has the highest 'productivity' in the world. The evaluation was based purely on the amount of hours worked. That does not show 'productivity' - all it showed was that Americans work longer hours than anyone else on earth. Now to give an example of a typical flaw in the measurement of productivity: In South Africa, an African bricklayer lays on average 800 bricks per day while his European counter part pays 1,200 bricks per day. That's a full 50% more and adds fuel to this argument. However, the African earns $4 per hour where the European earns $12 per hour. Now who is more productive? So if you employ two Africans at $8, they will lay 1600 bricks a day - far cheaper and far more output which allows South Africa to build some really mega projects even though they have a relatively small economy. BMW and Mercedes Benz have caught onto this and manufactor full cars in South Africa.

Subject: Re: globalization From: El Gringo To: Mik Date Posted: Wed, Jun 09, 2004 at 20:48:17 (EDT) Email Address: nma@hotmail.com Message: ...'The technological story of the productivity slowdowns holds that this vital engine of growth ran out of steam, not because there was anything wrong with the basic structure of our economy, but simply the technologies were the basis of the postwar boom had pretty much reached their limits....The point is that by the late 1960s these technologies had, in many cases, started to approach their limits.Indeed, to a considerable extent things that we still think of as 'modern' were introduced more than twenty years ago.It is somewhat startling, for example, to realize that the Boeing 747, 'still' the flagship of airlines, was introduced in 1969; today's version are improved, but not radically different.Bill McKibben, who subjected himself to a massive dose of television reruns for his book 'The age of Missing Information (Akerlof or Stiglitz...)', has pointed out a revealing fact;the houses shown in situation comedies from the early 1960's do not look particularly old-fashioned.Russell Baker has made the point even more strongly:'Why does 1940 still seem like yesterday, when back in 1940, 1890 seemed like the Dark Ages?'

Subject: Re: globalization From: Pete Weis To: El Gringo Date Posted: Wed, Jun 09, 2004 at 22:49:24 (EDT) Email Address: Not Provided Message: 'Why does 1940 still seem like yesterday, when back in 1940, 1890 seem like the Dark Ages?' El Gringo. This question which is really an observation and your point about 'productivity slowdowns' is central to a major economic theory which took hold in the 1930's. It was a Yale economist who first developed it. Unfortunately, I don't remember his name. His ideas and those who espoused them fell out of favor when money supply economic theory began its ascendancy in the 60's. His basic theory goes like this: Productivity gains happen in sudden spurts with lengthy plateau periods of little relative gain. These great spurts in productivity are born out of great technological advancements. The sudden gains in productivity have two major effects - (1) increased profits (lower cost per unit production) and (2) greater quantities produced do meet the greater demand (lower price per unit production). A great economic boom ensues. But inevitably, human competitive behavior (some would call it greed) increasingly takes hold. Those who control the profits and the means of production find it difficult to share much of the new wealth being created. At first there is a shortage of labor, so, initially, wages rise sharply but quickly wages begin to level off. This creates real problems since it is the wage earners who make up the bulk of the consumers. Without increasing wages consumption begins to slow. Politicians and central bankers who are in charge of fiscal and monetary policies are prodded by those with wealth (and the power which comes with it) to reduce lending rates and loosen lending requirements to consumers. Borrowing takes off and the boom continues..... for awhile. Corporations continue to borrow heavily as they expand to meet demand. Stock markets boom - nearly everyone starts to believe they will become wealthier than they had ever dreamed before the boom. But inevitably the debt reaches a critical level and becomes difficult to service. Aggregate wealth becomes highly concentrated in the hands of a relative few, who can not possibly consume as much as the masses who now have accumulated a ton of debt. Those who are the captains of the corporations see the end coming and jump ship before the passengers. Years of economic hardship follow. This is a cycle that repeats itself but is not generally recognized by the bulk of economists, politicians and general public as it is happening. However, Milton Friedman says 'hogwash' to this idea. He says the Great Depression of the 1930's need not have happen if only the government had taken the right steps. He says it's mostly about controlling the money supply. A fiat money system with the right hand on the faucet will cure our economic problems. Ben Bernanke, a Milton Friedman admirer and follower, told us not to worry - 'we have this printing press....'. Well, the time is nigh. Which economic theories stand and which ones fall. I think we find out in the coming months and years.

Subject: Re: globalization From: Mik To: Pete Weis Date Posted: Thurs, Jun 10, 2004 at 13:26:45 (EDT) Email Address: Not Provided Message: Pete, What was Paul Krugman's take on this topic you have raised? I remember Paul speaking about the idea of simply printing more money as a solution to Japan's economic woes. It kind of falls into the same category of what you are discussing. But I still don't see how it solves the productivity issue. Keynes lived through a a period of hyper inflation and as such would tend to stay away from using the printing press as a solution, but rather look at government fiscal intervention as a steering mechanism. However, I have often wondered about how the government's steering mechanism could modernise the average home and bring it out of the 1940's. Paul Krugman made a good point in his one book (the accidental theorist) where he took a good long look at his own kitchen and came to the conclusion that besides the microwave oven, there was nothing new in his kitchen (even a lot of the groceries were out dated).

Subject: Re: globalization From: Pete Weis To: Mik Date Posted: Thurs, Jun 10, 2004 at 22:59:52 (EDT) Email Address: Not Provided Message: Mik. I think when Paul Krugman was surveying his kitchen to find new technology, he was in the wrong room - what do you think? If he had left the kitchen for his home office he would have seen total change. Someone sitting in his/her home office in 1940 would see a Remmington typewriter, some wooden file cabinets and possibly a primitive, manual adding machine. Paul Krugman would likely be looking at a desktop computer, printer which also does photo's, digital camera, digital scanner, fax machine, a portable laptop, shredder, digital answering machine, and a small rack of laser disks to replace the file cabinets - and that's my small study. If someone from 1940 were to wander into such a room and log onto the internet, they would soon discover they had something akin to the Library of Congress packed into this study. The amazing realization is that all these marvelous technological wonders have only become reality in approximately the last 20 years. Nearly all the kitchen marvels of 1940 were developed in the first 20 to 30 years of the 20th century. It's interesting to note that each of these two great technological booms effected only one small area of a typical home. If you compared a home of 1940 with that of one in 1840, other than the style of furniture, only the kitchen would be obviously different. Oh..., there is one more very, very important difference - if Paul Krugman left his wallet laying around in his home office and someone from 1940 found it and started rummaging through it, they might come across these strange looking plastic cards that had bank names and funny names like VISA and American Express on them. Little would he know how these little items had changed the world and the nature of accumulating debt. As far as Paul Krugman's view on monetary policy vs government fiscal policy to thwart shifting of wealth during these technological booms to productivity booms to debt booms to bust - I'd like to hear more of what he thinks about this lately. In a Dec. 1999 paper entitled 'Thinking About The Liquidity Trap' he wrote the following paragraph: 'It is therefore ironic as well as unnerving that precisely at this moment, when we have all become sort-of monetarists, the long-scorned Keynesian challenge to monetary policy - the claim that it is ineffective at recession-fighting, because you can't push on a string - has reemerged as a real issue. So far only Japan has actually found itself in liquidity-trap conditions, but if it has happened once it can happen again, and if it can happen here it presumably can happen elsewhere. So if even Japan does eventually emerge from its slump, the question of how it became trapped and what to do about it remains a pressing one.' Now, Japan has emerged somewhat from its economic difficulties. But you have to wonder if it's not because of policies by Japan but rather policies by the US to prop up Japan's most important costomer, the American consumer. In fact, just as Japan was having its greatest difficulties in the 90's, the US economy was still booming and the American consumer was in fine form buying up Japanese products left and right. What would have happened if both the Japanese and US economies were tanking simultaneously. What would happen now if rising interest rates, higher energy costs and record debt finally begin to slow down the US consumer, who represents over 30% of the world's consumption? Wonder what this would do to the Japanese and Chinese economies and their ability to purchase US treasuries with their surplus trade dollars? How would the the US fund its huge budget deficit? Paul Krugman finished his paper with - 'We'll just have to wait and see.'

Subject: Good Piece on Greenspan by Krugman From: Pete Weis To: All Date Posted: Mon, Jun 07, 2004 at 15:56:18 (EDT) Email Address: Not Provided Message: Much of what Paul Krugman writes about (in his most recent editorial) with regard to Greenspan has been mentioned by others. However, few write with as much authority as Paul Krugman. I see his editorials often linked on economic and investment sites with conservative, moderate and liberal leanings. His editorial centers on the moral issues of promoting fiscal policies which favor the wealthiest and the hypocracy of standing by those policies (to 'save face') despite evidence they where based on major miscalculations. He touches on the failure to take away 'the punch bowl' and the development of 'asset' bubbles. Few if any of the 'elite' academic economists deal much with the dangers of asset inflation (stock markets, housing) - if they do at all, it's generally not a central issue for them. Keynesians and especially Monetarists seem to avoid the issue. It's the most conservative, neoclassical economists, represented by the Austrian school, which seem to fret the most about the dangers of asset bubbles. IMO, the neoclassicals make a good argument. Due to an unprecedented series of rate drops, refinancing and mortgages have become an abnormally large part of a number of economies, chief among them - the US economy. Western financial institutions are strung out on trillions in housing mortgages. Even at presently very high valuations, there is record low equity in US housing. Since interest rates have bottomed, a large percentage of refinancings and mortgages, in general, are ARM's (something Greenspan has urged homeowners to 'take advantage of'). Yet, nearly everyone agrees interest rates are headed higher. Furthermore, the first wave of baby boomers are getting ready to retire in the coming five years. Many of these retirees have refinanced their mortgages or have moved up to more expensive homes. They'll need to sell since they won't be able to afford the debt - in fact, they need to move away (to a greater extent than ever) to places where the housing is cheaper. Neoclassicals also point to the still overvalued stock markets (as does Buffet) and the unregulated, massive growth of derivatives (mostly made up of interest rate swaps). With rising interest rates, neoclassicals claim there will be a massive move to shed debt by selling assets as well as bankruptcies. With rising energy costs and rising interest rates a consumer dependent economy will inevitably see a sharp drop in consumption. Neoclassicals believe that government intervention, in the form of pumping the money supply, only delays the inevitable. In fact, they say that pumping the money supply creates asset bubbles which makes matters worse - we will end up with a bigger, steeper economic plunge. They certainly have the most dire outlook, but, IMO, they present a very powerful argument. However, Neoclassicals, neglect an important issue which Keynesians promote. This is the massive shift in the concentration of wealth to the very top, tiny percentage of the population. It is obvious, with the huge upward shift of top executive salaries and generous stock options over the last 20 years, where much of the loss of money in the stock markets since 2000 has gone. The vast majority of the consumer class has not enjoyed the increased profits of the computer age and has taken on a lot of debt to keep his/her head above water. In fact he/she has been encouraged (and continues to be encouraged) to take on evermore debt by the likes of Greenspan to keep this wealth transference going to the very last mortgage application. I suppose Paul Krugman is closer to being Keynesian than the other two schools. But I don't think he fits neatly into the Keynesian mold - perhaps I'm wrong. I'd like to see him express more with regard to asset bubbles - are they a serious problem or not? Is this money pumping experiment really working?

Subject: Billmon's Whiskey Bar From: David E... To: Pete Weis Date Posted: Mon, Jun 07, 2004 at 17:48:05 (EDT) Email Address: Not Provided Message: Billmon's Whiskey Bar has an article tying together the bubble and the trade balance. Billmon predicts resolution will move first thru inflation, followed by deflation. He ended his comments though with a sanguine assessment. 'Redressing this imbalance need not be catastrophic – the U.S. economy has already shown an impressive ability to roll with the punches, and has absorbed the shocks of the past three years far more quickly than I would have expected. Meanwhile, Asian integration is gradually making the region less export dependent, and will eventually turn it into the main locomotive of the global economy. In other words, the structural adjustments needed – less domestic consumption, more exports at home; more consumption, less exports abroad – will be painful (particularly without better international macroeconomic coordination) but they are, I think, doable.' So we are on a tightrope,if we have competent leaders with a good plan, and luck is ours, we will get to the other side of the chasm and resolve our trade imbalances. It is possible that it will be less painful than the Great Depression, but for sure it will be more difficult than any economic shift in the last 70 years. Here is a link to the Whiskey Bar- http://billmon.org/archives/001510.html#more

Subject: Re: Billmon's Whiskey Bar From: Pete Weis To: David E... Date Posted: Mon, Jun 07, 2004 at 19:19:24 (EDT) Email Address: Not Provided Message: 'It is possible that it will be less painful than the Great Depression, but for sure it will be more difficult than any economic shift in the last 70 years.' I don't think Americans, or for that matter the rest of the world is ready for for the actuality of this 'sanguine assessment', David E. But, for the relatively few who are very concerned about the 'structural' problems with the US economy and the perilous state of the US consumer, this probably is somewhat sanguine. An interesting blog site. Thanks for the link!

Subject: Krugman for President From: franky To: All Date Posted: Sun, Jun 06, 2004 at 20:42:38 (EDT) Email Address: FPalomino619@msn.com Message: Hey, I had never heard of Paul Krugman until this past Friday. Sorry. I haven't read the paper since Bush and his brother stole the 2000 election and it seemed that none of the so called liberal media was outraged. Well, anyway, I will start reading him from now on--even if it is in the New York Times. We need this guy to run for president. Someone convince him, please.

Subject: Krugman interview on BBC From: DKH To: All Date Posted: Sat, Jun 05, 2004 at 07:16:37 (EDT) Email Address: idea_refer@yahoo.com Message: Paul Krugman was recently interviewed on the BBC World Service. I heard the interview broadcast on June 5th. This interview will be available on the BBC website after being updated for June 5th program. BBC World Service www.bbc.co.uk/worldservice/programmes/the_interview.shtml

Subject: Re: Krugman interview on BBC From: Bobby To: DKH Date Posted: Sat, Jun 05, 2004 at 10:23:42 (EDT) Email Address: robert@pkarchive.org Message: I can't find it. Where's it stored? :(

Subject: Re: Krugman interview on BBC From: El Dude To: Bobby Date Posted: Thurs, Jun 10, 2004 at 19:08:20 (EDT) Email Address: nma@hotmail.com Message: Bobby:http://www.bbc.co.uk/worldservice/programmes/the_interview.shtml?focuswin

Subject: Luskin: Bush re-election correlates to S&P500 From: Kosh To: All Date Posted: Thurs, Jun 03, 2004 at 15:51:23 (EDT) Email Address: jrgallag@earthlink.net Message: It's no coincidence that last Tuesday's big rally happened the day after Bush's major speech on Iraq at the U.S. Army War College. With the nation pre-occupied by painful soul-searching about the war, a major address by the president was necessary to restore confidence that America is in control of a situation that has seemed recently to be almost out of control. In fact, it may be no coincidence that the market hit bottom and strongly reversed to the upside on March 12, following Bush's statement deploring the beheading of Nicholas Berg by Iraqi terrorists. Forgive me if it seems heartless to relate a tragic even like that to the stock market. But I can't fail to note that Berg's death may have marked the low point in America's perception of its efforts in Iraq -- and the point where American resolve began to stiffen. I know -- at this point you're asking what any of this has to do with the stock market. Bear with me! Economic growth is made possible only when people are willing to take risks -- to make bets on the future. To do that, people have to believe that the world they live in is a reasonably stable place, and they must have an inner sense of self-confidence and pride. Those necessary psychological preconditions of growth are thwarted when a nation is absorbed in divisive political strife, and beset by a pervading sense of confusion and guilt about the nation's fundamental direction and purpose. This election year is shaping up to be the bitterest and most divisive ever. What the candidates themselves are saying is bad enough, but the general public discourse on politics is even worse. It's filled with hate -- there's no other word for it. And it's coming at a time when -- still in the shadow of September 11, 2001 -- America is taking on some dangerous and difficult challenges with very uncertain payoffs. Whatever your personal preferences on all the issues in play right now, it's a fact that we feel better as a nation when our president acts like a leader. Then, though you may bitterly disagree with him, at least you know what he's thinking. With so much controversy about Iraq, Bush had been nearly absent from the public scene -- until that speech the night before the big stock market rally. Clearly America felt better the next day. There's another element, too. I've said here in my journals from the very beginning that I believe the economy (and, therefore, the stock market) would be better off if Bush were re-elected. Love him or hate him, the cold fact is that his economic policies are more pro-growth (or at least less anti-growth) than those Kerry is likely to come up with. And with things so uncertain in the world, there may even be some benefit to political continuity for its own sake. This belief continues to be born out by the way the market reacts to estimates of Bush's re-election probabilities. The chart below shows the S&P 500 ($INX) superimposed on the prices of futures contracts traded on Bush's re-election, traded on-line at Tradesports.com. The price of the Bush contracts represents the market's estimate of the probability of his re-election. When that probability goes up, so does the market. When that probability falls, the market falls too. Note that the Bush contract took a big turn for the better last Tuesday! http://moneycentral.msn.com/content/StratLabs/Round10/P85489.asp

Subject: Re: Luskin: Bush re-election correlates to S&P500 From: Ivan Z. To: Kosh Date Posted: Tues, Jun 08, 2004 at 20:42:40 (EDT) Email Address: iz@iz.com Message: I think anyone familiar with the body of work done on the relationship between the debt and the drag in growth in the 80's - and the reverse where the 90's saw the debt being addressed and the economy take off - would know that this is a lot of nonsense. Investors may like Bush...they may hate changes in administration...but I don't think any reasonable individual believes the fiscal policies of the Bush Administration are going to lead to more longrun growth than would the fiscal policies of a moderate Democrat. Equity markets may prefer Bush because his policies to lead greater disparities in income where the rich get richer...and the rich are more likely to invest their money in equities.

Subject: Re: Luskin: Bush re-election correlates to S&P500 From: Ivan Z. To: Kosh Date Posted: Tues, Jun 08, 2004 at 20:42:18 (EDT) Email Address: iz@iz.com Message: I think anyone familiar with the body of work done on the relationship between the debt and the drag in growth in the 80's - and the reverse where the 90's saw the debt being addressed and the economy take off - would know that this is a lot of nonsense. Investors may like Bush...they may hate changes in administration...but I don't think any reasonable individual believes the fiscal policies of the Bush Administration are going to lead to more longrun growth than would the fiscal policies of a moderate Democrat. Equity markets may prefer Bush because his policies to lead greater disparities in income where the rich get richer...and the rich are more likely to invest their money in equities.

Subject: Re: Luskin: Bush re-election correlates to S&P500 From: Pete Weis To: Kosh Date Posted: Thurs, Jun 03, 2004 at 23:21:41 (EDT) Email Address: Not Provided Message: You may be right with regard to some correlation in the waxing and waning of confidence in Bush with some recent small, short upturns and downturns in the markets. But it's much more likely the bigger picture of consumer debt, higher energy costs, rising interest rates, and general market overvaluation (if you believe Buffet) will have a much greater effect on the markets going forward than will the image of Bush as a 'strong leader'. In fact, IMO, the future course of the markets will have a much greater effect on the prospects of Bush W than the reverse.

Subject: Re: Luskin: Bush re-election correlates to S&P500 From: Nat To: Pete Weis Date Posted: Fri, Jun 04, 2004 at 00:56:41 (EDT) Email Address: Not Provided Message: I find it ironic that a modest upturn in jobs will probably lead to an interest rate hike that will in turn lead to a down turn in the stock market. Odd, but what is good for the US worker seems to be bad for business. And heaven forbid that real wages should increase! Inflationary! I bet that 5 more week's worth of 'stay the course' gibberish will be trumped by a two basis point increase...

Subject: Re: Luskin: Bush re-election correlates to S&P500 From: Pete Weis To: Nat Date Posted: Fri, Jun 04, 2004 at 11:55:25 (EDT) Email Address: Not Provided Message: It will be interesting to see if the Fed really believes we are in a sustainable recovery. If they really believe the jobs numbers and and the economy is actually picking up, they probably will hike rates. However, so far, they have been reluctant to raise rates and have been, recently, feverishly pumping the money supply - M3 has increased by over 150 billion the last 4 weeks (an annualized rate of over 20%). I'm not saying they won't raise rates, but if they don't, what would that say about Greenspan's actual faith in the economy? There is always a lot of spin out there with regard to the markets and the economy - each spin meister has his or her own agenda. It's doubley true in an election year. There is a lot of talk about decoding what Greenspan says and reading between the lines. I think it's better to pay little attention to what he says and focus on actions taken by the Fed - it's much more revealing.

Subject: Energy Crisis From: Watts To: All Date Posted: Thurs, Jun 03, 2004 at 09:21:32 (EDT) Email Address: Not Provided Message: Not that we don't already know Krugman was right on the energy crisis in California, here is an article from some former enron traders bragging about manipulating the markets. http://money.cnn.com/2004/06/03/news/midcaps/enron.reut/index.htm?cnn=yes

Subject: Socialist From: Doug Schmitt To: All Date Posted: Wed, Jun 02, 2004 at 15:45:48 (EDT) Email Address: schmdoug@yahoo.com Message: Thanks for posting this video of Krugman vs Barro. Krugman's beady little eyes help illuminate what a weasel he is.

Subject: Krugman at the LSE From: Chris To: All Date Posted: Tues, Jun 01, 2004 at 10:53:35 (EDT) Email Address: cwright75@hotmail.com Message: A transcript of Paul Krugman's talk at the LSE on the American Economy. LSE Events Transcripts www.lse.ac.uk/collections/LSEPublicLecturesAndEvents/events/2004/20040527t1238z001.htm

Subject: Krugman swings with a big bat! From: David E... To: Chris Date Posted: Tues, Jun 01, 2004 at 14:08:15 (EDT) Email Address: Not Provided Message: Thanks Chris for the link. Here is one of the many good parts in the transcript - 'You do wonder why it has been so easy for one side to wrap itself in the flag, and also wrap itself in family values and the other is so ineffectual. It is a source of puzzlement. The question I guess is, does this mean that this is wrong, that the public really understands that these policies are helping them. And the answer is that I don’t think that’s true. I think you can be reasonably clear on the actual math that the public is by and large voting for policies that are against its interests.' Prefacing this was a discussion about NPR not being a liberal anymore. A study was done of NPR's sources and 4-1 the sources were conservative think tanks. Conservative think tanks, though numerous, boil down to funding from 8 families.

Subject: Latinoamérica y la UE piden... From: El Gringo To: All Date Posted: Sat, May 29, 2004 at 20:13:19 (EDT) Email Address: nma@hotmail.com Message: Latinoamérica y la UE piden renforzar el papel de la ONU Zapatero se muestra dispuesto a enviar un contingente espanol a Haiti La III Cumbre América Latina-EU apostó ayer por el reforziamento de la ONU y del multilateralismo como mejor fórmula para resolver los conflictos internationales.La reunión, celebrada en Guadalajara (México), consolidó el diàlogo politico iniciado hace dos anos en Madrid entre dos zonas del mundo que agrupan a 58 países y cerca de mil miliones de personas.El Presidente del Gobierno, José Luis Zapatero, mostró su dispositión a enviar un contingente de tropas espanolas a Haiti junto a tropas latinoamericanas. 'Reconocemos la necesidad de hacer que el sistema multilateral sea más ágil y efectivo para enfrentar las amenazas y desafios globales', afirma la declaración final de la cumbre.'A este respecto, estamos comprometidos con la reforma y revitalizacíon de las Naciones Unidas'.La declaración tanbién condena las torturas aplicadas por soldatos estadounidenses a presos iraquíes en la càrcel de Abu Ghraib y se solidariza con las víctimas de los atentados del 11 marzo en Madrid.José Luis Rodríguez Zapatero indicó en su intervención que la UE y América Latina pueden abordar conjuntamente un amplio abanico de suntos, 'desde la reforma de las Naciones Unidas al respeto universal de los derechos humanos, el desarollo sostenibile, la eliminación de la 'corrupción' o el narcotràfico y la criminalidad organizada la erradicación de la pobreza o la lucha contro el terrorismo'.A petición del presidente brasileno, Luis Inàcio Lula da Silva , Zapatero se mostró dispuesto a enviar soldados espanoles a Haiti, aunque precisó que aún no ha tomado una decisión definitiva.Las ausencias màs significativas de la reunión fueron las del britànico Tony Blair, el italiano Silvio Berlusconi - aliados de EE UU en Irak - y el presidente cubano Fidel Castro, que dejó claro desde la Habana que las relaciones entre Cuba y Bruselas atrviesan el peor momento de su historia. (El Pais, Sàbado 29 de mayo de 2004)

Subject: New York Times Apologizes From: Pete Weis To: All Date Posted: Wed, May 26, 2004 at 23:32:23 (EDT) Email Address: Not Provided Message: To this day many Americans still think the Iraqis had something to do with 9/11. The Bush administration did much to try and cultivate this belief among US citizens even though no Iraqi participated in carrying out, planning, or financing the 9/11 tragedy. No evidence has yet been unearthed to make the connection. There is plenty of detailed evidence to show others participated. The New York Times should apologize - many other US news organizations need to offer up apologies. In a democracy a free press is its conscience, however imperfect. True, many of us have set our heads deep in concrete, refusing to listen to any news media which doesn't mold it's news to fit what we want to believe. Afterall, providing news information is a business and the customer's needs need to be met or the business suffers. But somewhere in the past, there seemed to be a belief that our news organizations were somehow above and independent (atleast to some extent) of simply being enslaved to the bottom line. Was this all a fantasy? Perhaps today when news media must compete with 'reality TV' the pressures are just to great. Or is this the way it has always been? Has Rupert Murdoch found the magic formula - define your audience and give them what they want - American marketing crafted by an Australian to perfection?

Subject: Re: New York Times Apologizes From: Kosh To: Pete Weis Date Posted: Wed, Jun 02, 2004 at 12:16:55 (EDT) Email Address: jrgallag@earthlink.net Message:

Subject: Re: New York Times Apologizes From: Kosh To: Kosh Date Posted: Wed, Jun 02, 2004 at 12:19:45 (EDT) Email Address: Not Provided Message: Ex-Congressman Sam Coppersmith notes 'You Don't Work the Ref When a Bad Call Goes Your Way' '...conservatives have had it in for The Times for years. But when the newspaper gets Iraqi WMD wrong, and admits that its reporters and editors let its readers down, people who have built entire careers screaming about bias and error have absolutely nothing to say. To these critics, any mistakes The Times made in running dozen of stories helpful to the Bush administration’s desire to topple Saddam Hussein weren’t evidence of bias or institutional error. Conservatives can easily forgive mistakes -- when they’re useful mistakes.'

Subject: Re: New York Times Apologizes From: WRS To: Pete Weis Date Posted: Fri, May 28, 2004 at 12:17:57 (EDT) Email Address: Not Provided Message: is a highly credentialed economist, but is no more qualified than any one else to be a media critic. He stumbles when he steps onto the slippery soap box of journalism ethics judge. Friday's column about the NY Times is awkward on many levels. I'm not sure what to make of the original correction in the NY Times given the snake pit climate in that organization and the hostile political climate. By entering this fray, PK only serves to make a murky situation even more confusing. I am not clear why PK feels qualified to singlehandedly decree ground rules for ethical behavior by the media. The media is basically a free-for-all business driven by ratings and advertising dollars. I can say from experience that journalistic rules about objectivity are ungrounded and often go unenforced and unheeded in the quest for audience. PK is entitled to cast laurels on reporters who slam Bush, but it looks to me like he is making up the rules of media engagement as he goes along. The guiding force seems to be the 'greater good' of making the White House look bad. Also bothersome is the patronizing undercurrent of PK's message. Consumers of the media are perceived as red state bumpkins who cannot understand events without the aid of pundits and are powerless to chose from myriad information sources. Were it not for White House efforts to bludgeon the spineless media, PK suggests, surely Bush's approval rating would be zero. The implication is that the presidential race remains competitive only because evil Fox News has brainwashed the most gullible segments of society into supporting the president. I would submit that there are reasonable people who support and oppose the president. But in PK's world, only one view is acceptable, and those who disagree must be either stupid or misinformed. In my humble opinion, his media watch columns are extremely naive and increasingly tedious.

Subject: Oh, come on WRS . . . From: Paul G. Brown To: WRS Date Posted: Fri, May 28, 2004 at 16:32:36 (EDT) Email Address: Not Provided Message: First, the column is about journalistic competence, not ethics. There is no accusation of corruption, nor of deliberate falsehood, in the PK column. What you ought to make of the NYT revisitation of its coverage is no different when the subject is WMDs than it was when the problem was Wen Ho Lee (remember him?). If you read the NYT mea cupla, what was most striking about it was the way the editors dissected the journalistic methodology that gave rise to the bogus facts in their coverage. I think they excused themselves too readily; the whole Chalabi-to-Cheney-to-Miller-to-Chalabi thing sounds to me more like a messed up triple-play. But according to Krugman, the root problem was 'competence', with the fetishization of objectivity (taken to mean partisan even-handedness or some kind of 'balance') contributing to the problem. Miller (and the NYT) simply ignored technical evidence (coming from credible experts in real-time) that, for example, aluminium hadn't been used in uranium centrifuges since the 1950s. There is even an absence of any evidence that anyone from the NYT ever spoke to these people. The incomparable Dailly Howler had its entire staff all over this one in real time. Why didn't Miller give more weight to these other experts? PK claims that it was because she, and the SCLM (So Called Liberal Media) were lulled by their patriotic feelings, their trust in the integrity of the White House, by the cloak of competence cast over the Bush cabinet, and by their own career aspirations. Got a specific problem with any of this? Miller et al. are reasonable human beings, trying their best, and messing it up. But contrast the NYT coverage with USA Today. Skeptical, and in hindsight, much closer to the truth than the SCLM (So-Called Liberal Media), never mind FOX. Third, when the situation is as bad as the situation is currently, how can you report on it objectively without making the White House look bad? I mean, things have rarely been worse! We are building a massive debt, losing war on terror, pissing off our trade partners and allies, economic growth sucks, we are way behind the curve, jobs wise, increasing poverty, increasing infant and maternal mortality, criminal investigations in high places (who leaked Palme, that little mis-appropriation of $700 Million, who gave Chalabi the classified details he passed onto the Iranians) and corruption (Perle, Halliburton, Kenny-Boy Lay still to see the inside of a cell). You have to reach a *long* way down the list of measures of national well-being to find any up-tick. It's dismal failure as far as the eye can see. Who has the responsibility? Who issued the orders? Objectivity is not a partisan formulation. It's about journalism as the first draft of history, and how close the first draft is to the final. By this measure the NYT in particular--and the media in general--have been terrible. And a final point regarding the patronization of rubes. I swallowed the NYT line, and I am no rube (though I do like beer and baseball). Neither is Kenneth Pollack, or Fareed Zakaria. But fool me once, shame on you. Fool me twice, and now I'm left owning a bridge somewhere, in a hot, dry country, were there are a lot of other claimants, and they have lots of guns. I won't belabor the argument, except to point out that, among the NYT's pundits, PK is solely qualified to write this kind of column. He was the first (and for a time, the only) major voice saying the kinds of things about Bush 43 that the rest of the flock have now come around to saying (dishonest, ideological, incapable of learning from their mistakes). And he endured tremendous amounts of abuse for doing so. PK is a public pundit. He tries to boil a complex opinion down into 750 words. Sometimes, he fails at it. But I often feel stupid and misinformed after reading a Krugman column. Which is precisely why I read him and admire his work.

Subject: Re: Oh, come on WRS . . . From: WRS To: Paul G. Brown Date Posted: Tues, Jun 01, 2004 at 14:19:27 (EDT) Email Address: Not Provided Message: Paul, I have to question your point that “things have rarely been worse.” If I didn’t know better, I’d say you are as naïve as PK. Do you really think we’re worse off now than in 1933, 1943, 1979, or 1917 or 1907? Try to get past your distaste for GW 43 and look at today’s indicators: 4-5 percent GDP, 2 percent inflation, 800,000 jobs in the past few months. You and PK may insist our way of life is unraveling, but I’m not buying the sky is falling snake oil. Yes, GW has cut corners, and we are paying a terrible price in Iraq in terms of blood and treasure. But I think many Americans are willing to pay more and concur that we are on the right side of history against Islamic fundamentalists. It is way too early to call our wars in the Middle East a failure. Sooner or later Saddam had to go, and Bush chose the sooner option, for better or worse. Do you disagree with the policy of removing the Taliban? Voters, not terrorists, will render a verdict on these questions in November, and Americans will pull together to support whoever wins. I also stand by my essential point that everyone is a media critic and that PK is not a particularly effective one.

Subject: Re: Oh, come on WRS . . . From: Paul G. Brown To: WRS Date Posted: Thurs, Jun 03, 2004 at 14:35:54 (EDT) Email Address: Not Provided Message: Whew. Busy. Hard to keep up. First, I should have been more precise in my language. In absolute terms, as measured by the various metrics of social good I cited, things have indeed, rarely been better than they are today, at least for citizens of the first world. More of us have achieved a comfortable degree of affluence (fewer are in poverty). We live longer, and suffer less. You make a good point. Optimism is rational. But on this forum we are talking, generally, about the effect of current policies. Are you really claiming that the improvement you're pointing to are the consequence of the Bush 43 economic and foreign policy regimes? Historically, all of the trend lines on these metrics have been positive. Each year we have lived longer, grown richer, and so on. So when you encounter a period of history when these trend lines have not only flattened but are beginning to trend in the opposite direction it's reasonable to say that 'things are getting worse'. And when, as now, some of those trend lines are the longest positive trend lines we have (infant mortality, poverty), and particularly when the policies imply truly dire consequences (we aren't going to grow out of this debt: big fiscal changes must be made) you can surely say 'things have rarely been worse' because our prospects for improvement in the future have rarely been dimmer. Now: you want to quibble over time periods. GDP growth is currently 4.4%. But that figure is a marginal rate of change. A glance at data for the overall timeseries reveals that growth since 2000 has been generally poor, with an uptick this election year (at the same time that the so-called conservative congress has flung aside its figleaf of fiscal probity and is now dancing, drunk and naked, around a Keynesian bonfire). This anemic growth is all the more troubling when it co-incides with a ballooning trade deficit, incredibly low interest rates for a very long period of time, and booming labor productivity. Put it this way, the gas tank's full, the pedal's to the metal, and the road is flat, straight and true. But we're doin' 35MPH and gettin' about 5 miles per gallon! Seen in that light, 'things have rarely been worse'. As for 'sky is falling snake-oil'; I assume that you're a reasonable person. What evidence could anyone offer that would lead you to conclude that Bush 43 has been characterized by the worst economic and social policy outcomes since Hoover and Coolidge? If we had been adding (compare with the 1990's) 250K jobs per quarter for just two years, while keeping inflation to 2% and not growing government debt (I won't even ask for a reduction) I would grade it a pass. On the Taliban - I was one of those pathetic hippies earnestly calling radio talk-back programs in 1992 worried about the rise of Islamic fundies in Afghanistan and Pakistan. I was one of those progressives who got into animated discussions with other progressives on the question of the legitimacy of military power. I wasn't totally convinced by the progressive-hawk argument until we got to contrast what happened in Kosovo (muscular, multi-lateral response through NATO) with central Africa (morally bankrupt non-response of the UN). The US is an emperial power. We might not like it, but that's the reality. And I want a competent emperor and competent consuls. Instead, we have Emperor Nero aided and abetted by Consul Varro. As for 'pull together to support whoever wins'; I see zip evidence that elements of the American conservative movement will *ever* accept the legitimacy of a Democratic leader. Al Gore stands up and says, in loud tones 'Someone ought to take responsibility for this fiasco', and the conservative pundit reaction is that he's insane (with the mumblers in the darker corners accusing him of treason).

Subject: Re: Oh, come on WRS . . . From: WRS To: Paul G. Brown Date Posted: Thurs, Jun 03, 2004 at 16:45:36 (EDT) Email Address: Not Provided Message: A few thoughts in reply: Your message omits the word 'recession,' which I think you'd agree was a major story for the US economy over the past three years. No reasonable person would blame Bush for a recession that began unfolding before his inauguration. Your expectation of a continuation of the 1990s bubble economy with 250,000 a month job gains is unrealistic, in my view. Granted, the economy has problems. But I'd take the past few years over 1977-1981 any day. Also, I'm not buying the Bush as Nero analogy, which I think trips up your thinking by allowing hatred to cloud your judgment. Democrats will not defeat Bush by defining him as a devil, because that view is not credible with the middleground electorate that decides the winner. Bush may very will defeat himself, however. In any event, it would be no contest if the Democrats were to nominate a stalwart pro-American candidate in the mold of Tony Blair who will is enlightened and will stick up for us in a world of great opportunity and danger. John Kerry is doing his best to appear to be that candidate, but I'm not sold. If he wins and as I expect reverts to form as a blame America first weasel, then, yes, conservatives will give him a very hard time, indeed.

Subject: Re: Oh, come on WRS . . . From: Paul G. Brown To: WRS Date Posted: Thurs, Jun 03, 2004 at 19:43:22 (EDT) Email Address: Not Provided Message: How far back do you have to reach for 'unfolding'? Economic cycles are part and parcel of life under capitalism. They're not a bad thing; they represent the occasional adjustment in the allocation of capital. But the Bush 43 recession--technically defined--ended in Q4 2001. Two and a half years later . . . Why is 250K jobs per month 'unrealistic'? We had eight years of 'unrealism'. Have a look at what the BLS says. Get a chart of the last 30 years of overall employment numbers. What makes this chart perilous is that you're looking at absolute numbers, but population growth also has a general linearity, so we're cool there. There was a big bump in 1999 (curiously: the same kind of pattern appears in the series in 1990, at the end of the last period of expansaion) but compare the 8 year trend 1992 - 2000 with the next four years 2000-2004. Then cast your eye back over the series and reflect that the last time we saw this kind of stagnant job growth was 1980-1983 (not 1977-1981). Bush as Nero? Have you read a biography of 'The GoldenOne'? In the popular mind Nero's an ogre, who persecuted Christians and fiddled while Rome burnt. Well, he wasn't, really. He was just kind of dumb, really ambitious, and way in the wrong place at the wrong time. I have nothing against Bush 43 at a personal level. He just seems to me like a lot of the over-promoted vice-presidents I've met. And your 'pro-American candidate like Blair' comment is very revealing. The Bush 43 administration might be seen, objectively, as anti-American. I guess they mean well but that's not a whole heck of a lot of comfort. Meanwhile those voices of caution (Snowcroft - remember him?) that a raft of folk dismissed by Coulter/Sullivan/O'Reilly as treacherous are being revealed as right (pro-american). I don't want a 'pro-American candidate like Blair'. Lord preserve us from such friends! Just give me character and competence! Your 'blame America first' comment is also revealing. It's not 'blaming America first' to point out that, as a matter of historical fact, empirial powers have always been hated and opposed by peoples on their periphery. It is also scarcely 'blaming America first' to point out that successful empires co-opted the nations on their borders more effectively than they can destroy them. So when someone says something like 'Islamo-fascism derives its political power from the way that the US is seen to favor certain groups in the middle-east at the expense of others', and then to follow up with 'an effective policy would therefore address this historical imbalance so as to remove the moral justification for the opposition', this is not 'blame America first'. It is an analysis of the situation, and a policy recommendation to address it. And saying things like 'a military strategy with the aim of promoting democratic change, even if successful, is too high a price to pay', is not 'blame America' either. It's not 'blame America first' to say that US dependence on foreign oil makes us extremely vulnerable, in both economic and national security terms. (For the record, I agree with the first two, disagree with the third and hold the fourth to be self-evident.) Read what the 'blame America first' crowd are saying. I just want to see those metrics of social and economic well-being heading in the right direction. I am less interested in who I have to blame or forgive to get there.

Subject: Re: Oh, come on WRS . . . From: WRS To: Paul G. Brown Date Posted: Fri, Jun 04, 2004 at 17:07:59 (EDT) Email Address: Not Provided Message: Although our discussion has strayed from the original thread about PK’s media watch, I think another reply is in order. The BLS data confirms my essential point that Bush 43 inherited a bubble economy poised for recession. Call it the Bush recession or the Clinton/Gore recession. But the point is the economy has been recovering from a serious illness and has just now regained strength. Not even PK could describe the 2004 labor market as “stagnant.” Blair is a stalwart ally who Democrats would be wise to emulate. He shows that it is possible to fight Islamo fascism while governing with a progressive agenda. His rhetoric is eloquent, and he is in the mold of traditional pro-defense US democrats (FDR, Truman, Johnson). Remember, it was JFK who once said he is willing to “pay any price and bear any burden” to protect freedom and democracy. You may find those concepts hokey, but they are important to many of us. Kerry’s Hamlet-like rhetoric is not stirring, and, given his track record, there’s no reason to expect any conviction from him. I hope the quotes you mentioned are not from Kerry because they are not presidential. Islamo fascism is a global problem that is much broader than America. Islamic terrorists have slaughtered innocents including many Muslims in Bali, Casablanca, Phillipines, Sudan, Indonesia and Turkey, to name a few places. America is hated because we impede their goal of world domination. Short of raising a green flag above the White House, terrorists will not stop, unless we stop them. There is no appeasing this lot, nor is there any “moral justification” for their nihilistic brand of murder. If we “address their historical imbalance,” they will be encouraged. Once they stop killing innocent people and begin doing something constructive, then we’ll talk about grievances. Is the US dependence on foreign oil part of the “moral justification” for terror? You suggest it is, but I disagree. We are not perfect. But, along with China and India, we use oil because we work hard, plus we have a big, rich country where people choose to commute. I don’t own an SUV, but John Kerry does (along with several airplanes and homes). I’m OK with $40 per barrel oil and incentives for efficient cars. But is it “moral justification” for mass murder because some of us drive big cars? I can’t tell if you or Kerry suggest a self-flagellating debate on “moral justification” for terror. But I know that JFK or Truman would never lead us down that dark path to nowhere.

Subject: The recession has been over ... . . . From: David E... To: WRS Date Posted: Fri, Jun 04, 2004 at 20:45:58 (EDT) Email Address: Not Provided Message: since 2001. The recession has been over for 3 years and no job growth. 140,000 new people in the labor market each month and no new jobs. Where are the jobs? 3 million less than we had in 2000. Clinton had a recession and it was turned around in one year just like Bush 43's recession did. I think you have to keep looking for a reason. A jobless return from a recession is a brand new event and President Bush presided over it. He owns it.

Subject: Re: Oh, come on WRS . . . From: Paul G. Brown To: WRS Date Posted: Fri, Jun 04, 2004 at 18:40:14 (EDT) Email Address: Not Provided Message: Sure we're off-topic. But so what? About every seven years, we have a recession. Economic recessions follow periods of economic expansion. As I pointed out, that's capitalism, baby. So it's not important when a recession starts: what's important is when it finishes, and what state you're in when you come out of it. Two and a half years after the end of the last recession (which itself lasted about a year) we are only now beginning to see job growth that's OK, on-par with what we saw on average throughout the 1990s. This growth is being achieved, as I said, by flinging fiscal probity out the window. Look at the contrasting policy regimes and outcomes. 1992, Clinton raised taxes on the upper income brackets and and contracted spending. But it was carefuly designed policy, and the economy grew steadily as the government got of the way. Bush 43 has shifted the tax burden down, is spending like William Bennet on a baccarat bender, and we're barely limping along. Why? Shitty, incompetent policy design. (Read O'Neill!) Step back and look at it. Which set of economic and social outcomes do you think history will look back on and prefer: a) 250K per quarter job growth, contracting G as a % of GDP, falling government debt, falling poverty and a foreign policy which, while far from flawless, elevated US prestige, or b) 140K jobs per quarter, exploding G as a % of GDP, exploding long term debt, increasing poverty, and a foreign policy that has nailed the military's feet to the floor while pissing off all of our friends and allies *and* giving the Islamo-fascists a sniff of victory? On the War: I beg you to read a little history, and an analysis of current affairs fueled by less tesosterone and more thought. I want to win this, but at the moment it looks to me like we're losing! National security has a military component. But if there is a lesson to be learnt from empires past it is that military power only gets you so far, and it gets you less and less further the more powerful you become. A military response was appropriate in Rome's Punic Wars with Carthage, Britain's 19th century wars with France and Spain, and even as a necessary element of the west's policy of containment towards the Soviets. But that was then, and this is now. 'Paying any price', when you are an empire, can mean treasure, not blood. Say, $100 billion (paid for by a 1% gas tax that grows by 0.5% per year for twenty years) spent on alternative energy research. Let the arab world figure it out on its own. India and China have (once we stopped trying to 'help'). Co-opt 'em. The idea is simply that its cheaper and easier to win that way. And keep the military for killing people and blowing up things. Sometimes, you just gotta. And they're good at it. Best in the world. On Moral Justification: There will *always* be small pockets of violent lunatics implaccably opposed to you. As I said, that's what it means to be an empire. And you can't hope to kill 'em all: at least not without becoming like them (in which case they win). They won't stop trying to kill us. The best you can hope for is to minimize their capacity to hurt us, cut into their recruitment before they 'strap on the plastic' (if you'll pardon the expression). Sure: if we 'address the historical imbalance' the fringe lunatics won't be satisfied. But the population they depend on for their cover, they will be less open to their rhetoric. As it is, they're kickin' our ass. Their argument is 'The US doesn't care about moslems. They just want our oil, and they will kill anyone who stands between them and it. That's why they support Israel: it provides a base. But God is on our side. They have stuck their hands into a hornets nest and we will make them pull it out.' The fact that none of this is true (except maybe the last sentence) is beside the point. All of our actions in this conflict appear to support that story. On 'doing something constructive'. Were you paying any attention during the 70's and 80's? We, the west, crushed a wide variety of moderate, liberalizing movements. Read a history of the Iranian revolution, or Chile, or Bolivia, or Cambodia. Opposition to the Shah had a radical and a moderate component. The moderates tried to work within the system. They got locked up and killed. I was writing letters on their behalf. Violent, radical revolution worked. Can you appreciate why these folk would sort of look at you funny, then glance nervously over their shoulders and check the exits when you ask them to 'be constructive'? Kennedy's 'moral clarity' and 'soaring rhetoric' got us into the Bay of Pigs, and Vietnam. His sagacious maneuver over obsolete NATO missiles in Turkey got us through the missile crisis. His 'soaring rhetoric' is like Prime Minister Andrew Fisher of Australia, who said that Australia was prepared to defend Britian 'to the last man and the last shilling', or those fine gentlemen of the south who proclaimed that no yankee was worth a damn in a fight. Fat lot of good it did any of them. Punch hard. Punch smart. (Or at least competently.) And remember punches start with balanced footwork.

Subject: Re: Oh, come on WRS . . . From: WRS To: Paul G. Brown Date Posted: Mon, Jun 07, 2004 at 00:08:03 (EDT) Email Address: Not Provided Message: Your point about perception in our war against Islamic fanatic killers is well taken, but I would not concur that terrorists are kicking our ass. Strategically and militarily we have made tremendous gains. But when it comes to winning the hearts and minds, we are faltered. I would submit that no matter what, we will be hated. Which is better? To be feared and respected or perceived as cowards? We've got to strike the right balance and be smart. Is empire really the right word to describe the US? I don't think so. The countries we have conquered (Japan, Germany, France, S. Korea) are basically independent and free, albeit they follow our model of elections and free markets. We should not be compared with the Romans who enslaved their subjects, or even the British who brutally controlled the Irish and the Indians under their flag. American influence, while backed by powerful military, is more subtle and geared to maintaining free trade and the global order of nations. We are compelled to take up arms when one force or another (Nazism, communism, Islamic fascism) threatens the delicate balance of world cooperation, a system that we have established to a large extent, but basically a fair and rational system that has led to tremendous prosperity. So I question whether we are an empire in the traditional sense. The last point is that Democrats, post JFK, seem to be out of touch with what makes America special. Yes, talking about freedom and democracy can sound hokey. But Americans expect from their leaders a sense of optimism and want to be told that all of the blood and treasure we've put forth over the years is for a good cause. Even if we're not always righteous, we like to think that we are. Democrats would do well to describe our country and its history in forceful and even glowing terms, without hedging, or expressing embarassment for what we have accomplished. They seem more intent on dividing the country by hammering at social or class distinctions and fostering grievances than strenghtening common bonds steeped in a great history and shared hope for the future. Instead of endorsing a positive vision of America, Kerry and Ted Kennedy seem intent on blaming this country for all the problems of the world. In my opinion, Kerry's message is too divisive and insufficiently uplifting to resonate, at least across the red state part of the country where I live.

Subject: Re: Oh, come on WRS . . . From: El Gringo To: WRS Date Posted: Mon, Jun 07, 2004 at 18:37:10 (EDT) Email Address: nma@hotmail.com Message: 'Is empire really the right word to describe the US? I don't think so. The countries we have conquered..........'

Subject: Re: Oh, come on WRS . . . From: Paul G. Brown To: WRS Date Posted: Mon, Jun 07, 2004 at 15:01:33 (EDT) Email Address: Not Provided Message: First WRS, let me say it is a pleasure to debate you. Your points are cogent, well made, and obviously sincere. In another response on this site I said something to the effect that we just can't have sweet reason on Internet because it interrupts our flow of invective and bad faith. You exhibit neither. At the end of this response I want to touch on an idea that you have succeeded in convincing me of. First! Winning, or losing? Don Rumsfeld agrees with me. 'The United States and its allies are winning some battles in the terrorism war but may be losing the broader struggle against Islamic extremism that is terrorism's source, Defense Secretary Donald Rumsfeld said Saturday. The troubling unknown, he said, is whether the extremists -- whom he termed ''zealots and despots'' bent on destroying the global system of nation-states -- are turning out newly trained terrorists faster than the United States can capture or kill them. ''It's quite clear to me that we do not have a coherent approach to this,'' Rumsfeld said at an international security conference.' On Empire: I have Naill Ferguson's book Colossus: The Price of America's Empire on order, so I can't quote from it yet. But I heard him speak--it's surprising the heft that a plummy accent lends an argument--and he makes the point that while the US loudly disavows any claim to being an empire, it sure acts like one, and it benefits from its ability to project its power internationally. He also points out that there have been, over the years, and enormous variety of imperial forms: from despotic Russian Czars, Chinese Emperors and Belgian Kings to the purely economic power of the late Byzantine to the quasi-religious 'Holy Roman Empire'. The US is functionally an Empire. As empires go, I judge it to be a pretty good one (liberal, humanistic (for the most part) and progressive). And the kind of social stability (Pax Americana) that an empire (any empire) brings is a necessary condition for broad human progress. Overall, I like the US emperial experiment, which is why incompetent emperors and corrupt consuls upset me. But my argument is that the US ought to recognize that it is, for all intents and purposes, and empirial power, and it ought to think about its geopolitical options in that light. To deny it purely for 'form' is just dumb. On Domestic verse International Concerns: the struggle to overcome injustices caused by social and class distinctions is as much a part of the American story as the fight against external totalitarianims. The original revolutionary movement, emancipation, sufferage, the labor movement, the New Deal, social security, and so on; all of these have been victories forged by hammering at 'class distinctions'. I don't think any political party 'fostered [these] grievances'. Rather, within a democratic framework, people who were the (typically unconsidered) victims of some social or legal construction brought about a democratic movement for change. All of them are changes which, I put it to you, have had the effect of strengthening the nation's bonds. Democrats--and progressives more generally--find their inspiration in this history. We hold the egalitarian ideal to be just as positive a vision as US success internationally; a vision we have yet to achieve. Now: the broader point I alluded to earlier. Each of us responds positively to a different set of symbols attached to what I call 'western liberalism'. The project is larger than the United States. Ideas like capitalism, democracy and sufferage are still revolutionary ideas in much of the world, and the US has been the greatest exporter of revolution in history. For some, probably including you, WRS, the important symbols are things like the stars-n-stripes, the important historical events are things like the second world war, and the potent words are 'freedom' and 'democracy'. Now, for many progressives, many Democrats, the affection and regard is the same, but the symbols, events and words they emphasize are different. For example, the big symbols in my mind are the Declaration of Independence, the legal edifice of the Constitution and Half-Dome in Yosemite. The big events are emancipation, sufferage and the Marshall Plan. I think we share the big words--'democracy', and 'freedom'--altough perhaps we emphasize different aspects of what those words refer to. But you should not deny the legitimacy of such progressive values. They are perfectly compatible with your own. Democrats like John Kerry, Max Cleeland, Bob Kerrey, and Daniel K. Inouye (the last two awarded the Medal of Honor) hold both. I put it to you that denying the legitimacy of one vision of American while placing an absolute emphasis on the other is a recipe for civic disaster. It was a mistake made by many on the left after the Vietnam War. The big idea you've convinced me of? That this 'hookey language' as you call it can be a sincere statement of patriotic intent. I had held the view--cynically, perhaps--that such language was the first refuge of scoundrels. I was wrong. It isn't. You've convinced me.

Subject: Re: Oh, come on WRS . . . From: WRS To: Paul G. Brown Date Posted: Mon, Jun 07, 2004 at 16:53:09 (EDT) Email Address: Not Provided Message: Thanks. I've enjoyed the exchange. I hear what you and Rummy are saying about the terror war, and I'll leave the question of American empire to loftier minds. I recognize that America's job as superpower is bigger than just keeping open the shipping lanes and at this point in history appears to be entirely thankless. What would Michael Moore say if we packed up our military, went home and let the rest of the world sort out their ancient grievances? It is a tempting proposition when the global fashion of the day is torching the stars and stripes. But, alas, we have litle choice but to reckon with our fate as reluctant empire. I appreciate your description of the different shades of patriotism and will pay attention as Kerry redefines himself for the national electorate. He will have to do more to separate himself from the 'we're all victims of a corporate conspiracy to screw the poor' crowd on the left. He also needs Bill Clinton's gift for story telling and connection with the common man, but no amount of Teresa Heinz money can buy that. My vote (along with many others) is available, but he will have to earn it. That is just my unsolicited advice worth about as much as I was paid to provide it.

Subject: Re: Oh, come on WRS . . . From: El Gringo To: Paul G. Brown Date Posted: Fri, Jun 04, 2004 at 20:43:14 (EDT) Email Address: nma@hotmail.com Message: 'National security has a military component. But if there is a lesson to be learnt from empires past it is that military power only gets you so far, and it gets you less and less further the more powerful you become. A military response was appropriate in Rome's Punic Wars with Carthage, Britain's 19th century wars with France and Spain, and even as a necessary element of the west's policy of containment towards the Soviets.' Perfect, simply perfect, Paul Delong...

Subject: Poverty . . . From: RL To: Paul G. Brown Date Posted: Mon, May 31, 2004 at 05:22:00 (EDT) Email Address: rafaelloring@yahoo.es Message: Paul, I have trying to check data on poverty and I have been only able to find data up to 2002. It doesn't seem very bad in comparison with other reccesions. see the nice graph. Can you tell me where to find data that reaches to 2004? http://www.census.gov/hhes/poverty/poverty02/pov02fig1.jpg RL

Subject: Re: Poverty . . . From: Paul G. Brown To: RL Date Posted: Thurs, Jun 03, 2004 at 15:15:13 (EDT) Email Address: Not Provided Message: Yeah - best I 'official' figures I can find are at the whitehouse dashboard. They're only up to Sept 2002. I am sure that I have heard reports to the effect that 'university studies show' increases in poverty (in both absolute and relative terms). But I can't put my finger on that data.

Subject: Re: New York Times Apologizes From: The Dude To: Pete Weis Date Posted: Fri, May 28, 2004 at 09:37:06 (EDT) Email Address: nma@hotmail.com Message: 'American marketing crafted by an Australian to perfection?' Hm, collateral effects (damages?) of free trade?

Subject: I suppose From: Pete Weis To: The Dude Date Posted: Fri, May 28, 2004 at 10:41:50 (EDT) Email Address: Not Provided Message: Might as well add this to the long list of things we blame on free trade.

Subject: I agree From: Mik To: Pete Weis Date Posted: Fri, May 28, 2004 at 15:32:38 (EDT) Email Address: Not Provided Message: Hahaha.... Pete Weiss... you aussies are now to blame?... look on the bright side, when all else fails, just give the Kiwis a thumping in Rugby and all will be okay. By the way did you see the super 12 game? WRS - I couldn't agree with you more. What PK has taught me is that there are some very clear rules to Economics and when applied - Economics is like a science - it doesn't lie. While PK was in this realm pointing out how other economists would try take on various 'concepts' to suit some political goal, PK would come in to point out their bull (send me back to my University Eocnomics text book) and clarify the matter. Now PK seems to be getting more and more into politics - a very subjective field. And I agree with you that PK is taking on a 'one-sided' approach. I have raised this before here.

Subject: Fond Memories of Tombo From: Jonathan To: All Date Posted: Sat, May 22, 2004 at 10:38:39 (EDT) Email Address: jonathan@lyingsocialistweasels.com Message: Posted: Thurs, Jun 05, 2003 at 19:35:53 (EDT) Posted by: Tombo Recipient: Tombo Email Address: onlyinmoscow@yahoo.com Subject: Re: Raines Falls--How long 'til Paul's axed? Message: My bet is that Paul won't last the year at the Times. Look for him to write increasingly for marginal lefty niche publications like The Nation or The New York Review, where his embarrassing screeds can fall like sermons on the ears of the faithful --- -- Since it's almost been a year since Tombo came here, pretended to be a Democrat who hated Krugman, and claimed the Good Professor would soon 'get the axe', once Keller took over. I thought it fitting to review his claims for posterity. Will Tombo have the courage to come back and admit how wrong he was? My money's on 'no'.

Subject: Re: Fond Memories of Tombo From: Bobby To: Jonathan Date Posted: Sat, May 22, 2004 at 23:57:00 (EDT) Email Address: robert@pkarchive.org Message: At some point I banned two IPs from this board -- the only IPs I ever banned from this board. One may have been Tombo but don't remember. I'll reinstate them both just in case.

Subject: Time passes slow... From: El Gringo To: All Date Posted: Fri, May 21, 2004 at 19:08:48 (EDT) Email Address: nma@hotmail.com Message: Debt level places US at risk By Charles Stein, Globe Columnist, 4/4/2004 In 2002,Treasury Secretary Paul O'Neill asked a pair of economists to calculate the federal government's fiscal gap. In simplest terms, O'Neill wanted to know how big a tab the current generation was leaving for future generations to pay. The calculation included everything from the cost of defense and roads to the bills for Social Security and Medicare. Their work never made it into print. After O'Neill was fired, his successor, John Snow, decided not to publish the findings. He may have figured that the estimate, like last week's gory atrocity photos from Iraq, was just too disturbing for the American public to handle. Laurence Kotlikoff is in the Paul O'Neill mold. The chairman of Boston University's economics department feels strongly that the nation needs to face up to the fact that it has created obligations that it cannot possibly afford. ''This is the moral crisis of our age,' he writes in his new book, ''The Coming Generational Storm. ''We are collectively endangering our children's future without giving them the slightest say in the matter.' Kotlikoff's book arrives at a good time. Washington's spiraling budget deficit has become a campaign issue. Last month, the trustees of Social Security and Medicare released annual reports that showed the programs for seniors have multitrillion dollar liabilities. Red ink is on the nation's radar screen. To Kotlikoff, the discussion is welcome but misguided. He is a harsh critic of government accounting, arguing that it gives a distorted picture of the country's finances. ''We hide our bills the way Enron did,' he said in a recent interview. Kotlikoff is one of the pioneers of generational accounting, a system that measures the burden today's commitments will create down the road. ''It's the future, stupid,' he writes in his book. O'Neill's economists used a similar approach. They concluded that America's fiscal gap was $44 trillion, more than four times the gross domestic product. To put that number in perspective, think about this. If the politicians in Washington wanted to fix the problem today, they would have to choose from among the following unpleasant options: Raising income taxes by 69 percent, boosting payroll taxes 95 percent or cutting Social Security and Medicare 45 percent The longer we wait, the more Draconian the tax hikes or cuts will have to be. Kotlikoff isn't holding his breath waiting for Washington to move. ''Politicians are lower life forms,' he said. But a failure to act will have consequences, he warns. In a worst-case scenario, he envisions a future that makes the ''Terminator' seem hopeful. He forsees a stagnant American economy crushed by debt. Taxes are dramatically higher. So is the inflation rate because the government has decided to print money to escape the fiscal vice. Money and talent are fleeing the country. ''I'm not particularly optimistic,' said Kotlikoff. Not everyone is so gloomy. While conceding that an aging population and rising medical costs pose major challenges, some economists say the problems are manageable. ''We will have to make adjustments but it won't be the apocalypse,' said Marilyn Moon of the American Institutes for Research, a Washington think tank. I hope she is right. But is it too much to ask the two candidates for president this year just how they plan to make the adjustments? The early indicators aren't promising. President Bush's three tax cuts contributed $9 trillion to the fiscal gap, according to Kotlikoff. Bush's Medicare drug benefit will add trillions more to the $44 trillion total. Like most Democrats, John Kerry has stressed the importance of preserving Social Security and Medicare benefits, without saying how he expects to pay for them. His proposed tax hikes on the wealthy will help close the gap, but compared to the size of the problem, he is spitting in the ocean. Zoology was never my strong suit, but I recall that most ''lower life forms' -- Kotklikoff's description of politicians -- wriggle around because they have no backbone. Do Bush and Kerry? © Copyright 2004 Globe Newspaper Company.

Subject: Re: Time passes slow... From: Pete Weis To: El Gringo Date Posted: Fri, May 21, 2004 at 22:02:52 (EDT) Email Address: Not Provided Message: Hopefully our next President will be more concerned how he will be judged by future generations. With the way things are going he will likely have many, if not a majority, of voters angry with him early in his term, since so many are being told, presently, that our economy is in good shape. There is no sense in worrying about getting re-elected - he will need to become totally immersed in finding and utilizing this nation's best talent in developing and trying solutions for desperately urgent problems. This will give him his backbone. But a backbone, alone, is not enough. He needs a brain to go along with the backbone and a willingness to work with the rest of the world to make life easier for all the world's citizens. We can't solve our many problems, economic and otherwise, without help from other nations - we're going to have to help each other and we need a President who can lead us in that direction. We need to swallow our pride.

Subject: Outsourced and Out of Work? From: The Dude To: All Date Posted: Fri, May 21, 2004 at 18:36:50 (EDT) Email Address: nma@hotmail.com Message: Outsourced and Out of Work by Joseph E. Stiglitz The latest buzzword in the globalization debate is outsourcing. Suddenly Americans - long champions of globalization - seem concerned about its adverse effects on their economy. Its ardent defenders are, of course, untroubled by the loss of jobs. They stress that outsourcing cuts costs - just like a technological change that improves productivity, thus increasing profits - and what is good for profits must be good for the American economy. The laws of economics, they assert, ensure that in the long run there will be jobs for everyone who wants them, so long as government does not interfere in market processes by setting minimum wages or ensuring job security, or so long as unions don't drive up wages excessively. In competitive markets, the law of demand and supply ensures that eventually, in the long run, the demand for labor will equal the supply - there will be no unemployment. But as Keynes put it so poignantly, in the long run, we are all dead. Those who summarily dismiss the loss of jobs miss a key points: America's economy has not been performing well. In addition to the trade and budget deficits, there is a jobs deficit. Over the past three and a half years, the economy should have created some 4 to 6 million jobs to provide employment for new entrants into the labor force. In fact, more than 2 million jobs have been destroyed - the first time since Herbert Hoover's presidency at the beginning of the Great Depression that there has been a net job loss in the US economy over the term of an entire presidential administration. At the very least, this shows that markets by themselves do not quickly work to ensure that there is a job for everyone who wishes to work. There is an important role for government in ensuring full employment - a role that the Bush administration has badly mismanaged. Were unemployment lower, the worries about outsourcing would be less. But there is, I think, an even deeper reason for concerns about outsourcing of, say, hi-tech jobs to India: it destroys the myth - which has been a central tenet of the globalization debate in the US and other advanced industrial countries - that workers should not be afraid of globalization. Yes, apologists of outsourcing say, rich countries will lose low-skilled jobs in areas like textiles to low wage labor in China and elsewhere. But this is supposedly a good thing, not a bad thing, because America should be specializing in its areas of comparative advantage, involving skilled labor and advanced technology. What is required is 'upskilling,' improving the quality of education, especially in science and technology. But this argument no longer seems convincing. America is producing fewer engineers than China and India, and, even if engineers from those developing countries are at some disadvantage, either because of training or location, that disadvantage is more than offset by wage differentials. American and rich country engineers and computer specialists will either have to accept a wage cut and/or they will be forced into unemployment and/or to seek other employment - almost surely at lower wages. If America's highly trained engineers and computer specialists are unable to withstand the onslaught of outsourcing, what about those who are even less trained? Yes, America may be able to maintain a competitive advantage at the very top, the breakthrough research, the invention of the next laser. But a majority of even highly training engineers and scientists are involved in what is called 'ordinary science,' the important, day-to-day improvements in technology that are the basis of long-term increases in productivity - and it is not clear that America has a long-term competitive advantage here. Two lessons emerge from the outsourcing debate. First, as America grapples with the challenges of adjusting to globalization, it should be more sensitive to the plight of developing countries, which have far fewer resources to cope. After all, if America, with its relatively low level of unemployment and social safety net, finds it must take action to protect its workers and firms against competition from abroad - whether in software or steel - such action by developing countries is all the more justified. Second, the time for America to worry is now. Many of globalization's advocates continue to claim that the number of jobs outsourced is relatively small. There is controversy, of course, about the eventual size, with some claiming that as many as one job in two might eventually be outsourced, others contending that the potential is much more limited. Haircuts, like a host of other activities requiring detailed local knowledge, cannot be outsourced. But even if the eventual numbers are limited, there can be dramatic effects on workers and the distribution of income. Growth will be enhanced, but workers may be worse off - and not just those who lose their jobs. This has, indeed, already happened in some developed countries: in the ten years that have passed since the signing of the North American Free Trade Agreement, average real wages in the US have actually declined. Putting one's head in the sand and pretending that everyone will benefit from globalization is foolish. The problem with globalization today is precisely that a few may benefit and a majority may be worse off, unless government takes an active role in managing and shaping it. This is the most important lesson of the ongoing debate over outsourcing. Joseph E. Stiglitz is Professor of Economics at Columbia University and a member of the Commission on the Social Dimensions of Globalization.

Subject: Re: Outsourced and Out of Work? From: Pete Weis To: The Dude Date Posted: Fri, May 21, 2004 at 21:36:04 (EDT) Email Address: Not Provided Message: Stiglitz is right to say 'putting one's head in the sand.... is foolish'. I believe he is correct to say that 'a few may benefit and a majority may be worse off' - atleast in the short term. However in the longer term, clearly, many in developing nations will benefit at the expense of today's wealthier societies. I'm not sure anything can realistically be done by 'government taking an active role in managing and shaping it'. Has anyone really come up with a solution to make globalization a smoother, less painfull transition? I believe a lot of pain is headed our way. We have become very, very vulnerable to the negative effects of outsourcing, higher interest rates, higher energy costs and ill conceived foreign occupations. Our perceived prosperity is more illusion than reality. Our much ballyhooed productivity doesn't (and hasn't for some time) come close to matching our lust for buying things. Much of our prosperity is built on debt. We have a huge pile of things and a massive mountain of debt. When globalization, higher interest rates, and higher energy costs collide with an economy overburdened with world record debt, bigtime pain is inevitable.

Subject: Re: Outsourced and Out of Work? From: Yann To: Pete Weis Date Posted: Sat, May 22, 2004 at 09:37:46 (EDT) Email Address: Not Provided Message: Pete is rather pessimistic. Maybe the game is not a winner-winner one, at least in the short run? Maybe less extreme poverty 'at the expense of today's wealthier societies' is not a very bad thing? By the way, did you read the last book of J. Bhagwati entitled 'In Defense of Globalization'?

Subject: Re: Outsourced and Out of Work? From: Pete Weis To: Yann Date Posted: Sat, May 22, 2004 at 14:06:27 (EDT) Email Address: Not Provided Message: Maybe it's not a winner-winner situation for those of us who now own most of the baubles. But, hopefully, somewhere down the road (and it may be pretty distant) a leveling of wealth throughout the world brings less strife and bloodshed. With regard to my pessimism about our present economy - after 20 something years of booming markets we have a heavy predilection toward a positive outlook. When things finally hit a bottom there will be, IMO, a heavy lean to the pessimistic side. This is when I will have a more positive outlook with regard to investing in the markets and an improving economy. However, IMO, it will be from a very low bottom. As Buffet points out - 'unfortunately the bust will be proportional to the boom'. I believe it is herding behavior, with regard to investing and spending, that is central to driving our markets and economy through cycles of booms and busts. And I don't believe there is anything the government or Fed can do to alter it much - perhaps they can only delay the inevitable.

Subject: Re: Outsourced and Out of Work? From: The Dude To: Pete Weis Date Posted: Sat, May 22, 2004 at 21:04:26 (EDT) Email Address: nma@hotmail.com Message: 'This is not the end. It is not even the beginning of the end. But it is, perhaps, the end of the beginning.'

Subject: Re: Outsourced and Out of Work? From: RL To: The Dude Date Posted: Mon, May 24, 2004 at 07:45:01 (EDT) Email Address: rafaelloring@yahoo.es Message: I am surprised by Stiglitz's article. I don't advocate for out sourcing it's just what is happening. It would be foolish and unjust if developed countries stop workers from entring and multinationals from outsourcing. I don't know if Stiglitz realizes what kind of ideoly he is pushing for. It's easy to say that the government should shape globalization and nothing else, it is clear for me that Stiglitz doesn't have a clue of what it should be done, he knowns he can't say the most obvouis (capital controls or protecsionism) because they are counter productive. RL

Subject: Re: RL, HMMMM! From: The Dude To: RL Date Posted: Mon, May 24, 2004 at 17:58:10 (EDT) Email Address: nma@hotmail.com Message: 'Stiglitz doesn't have a clue of what it should be done, he knowns he can't say the most obvious (capital controls or protectionism) because they are counter productive.' 'On September 7, 1998, in a now-famous column in Fortune magazine, the noted economist Paul Krugman urged Mahathir to impose capital controls.But he was in the minority.Malaysia's Central Bank governor Ahmad Mohamed Don and his deputy, Fong Weng Phak, both resigned, reportedly because they disagreed with the imposition of the controls - those from Wall Street joined by the IMF - predicted disaster when the controls were imposed, saying foreign investors would be scared off for years to come.They expected foreign investment to plummet the stock market to fall, and a black market in the ringgit, with its accompaniyng distorsions, to form.And, they warned, while the controls would lead to a drying up of capital inflows, they would be ineffective in stopping capital outflows.Capital flight would occur anyway.Pundits predicted that the economy would suffer, growth would be halted, the controls would never be lifted, and that Malaysia was postponing addressing the underlying problems.Even Treasury Secretary Robert Rubin, usually of such quiet demeanor, joined in the communal tongue-lashing.In fact, the outcome was far different.My team at the World Bank worked with Malaysia to convert the capital controls into an exit tax.Since rapid capital flows into or out of a country cause larger disturbances, they generate what economists call 'large externalities' - effects on other, ordinary people not involved in these capital flows.Such flows lead to massive disturbancies to the overall economy.Government has the right, even the obligation, to take measures to address such disturbances.In general, economists believe that the market-based interventions such as taxes are more effective and have fewer adverse side effects than direct controls, so we at the World Bank encouraged Malaysia to drop direct controls and impose an exit tax.Moreover, the tax could be gradually lowered, so that there would be no large disturbance when the interventions were finally removed.Things worked just as planned.Malaysia removed the tax just it had promised, one year after the imposition of controls.In fact, Malaysia had once before imposed temporary capital controls, and had removed them as soon as things stabilized.This historical experience was ignored by those who (RL?) attacked the country so roundly.In the one-year interim, Malaysia had restructured its banks and corporations, proving the critics, who had said that it was only with the discipline that comes from free capital markets that governments ever do anything serious, wrong once again.Indeed, it had made far more progress in that direction than Thailand, which followed the IMF prescriptions....bla, bla, bla ' HMMMM!

Subject: Re: RL, HMMMM! From: RL To: The Dude Date Posted: Tues, May 25, 2004 at 04:26:00 (EDT) Email Address: rafaelloring@yahoo.es Message: Dude, do you think those capitals controls work in the case we are discussing?. Is not like the US is suffering a temporary panic of short term investors is that it's own companies are using direct investment to increase efficiency, nobody, not Krugman not anybody has ever proposed capital controls on that kind of investment. RL

Subject: What do we do?? From: David E... To: RL Date Posted: Tues, May 25, 2004 at 16:11:53 (EDT) Email Address: Not Provided Message: Shouldnt we have some kind of sharing? Outsourcing affects the economy unevenly, the folks who outsource have gains, and the folks who lose their jobs have losses. Isnt some kind of short term equity called for here? And the bigger question is can we maintain our standard of living as more of our jobs are outsourced? This new wave of outsourcing includes customer service call centers, financial analysts, economists, electrical engineers, civil engineers, mechanical engineers, lawyers, accountants, tax accountants, medical records, drug research scientists, mathematicians, radiologists and information technologists. We need a plan to smooth out these disruptions. Who has one?

Subject: Re: What do we do?? From: The Dude To: David E... Date Posted: Tues, May 25, 2004 at 17:47:10 (EDT) Email Address: nma@hotmail.com Message: We can maintain our standard of living, but we have to work, work a lot, educate, educate a lot, and respect, respect a lot.We are the country that always has been fighting for freedom and thus automatically tolerance, the country of the market-economy, the country that although having been confronted to a terrible episode will show the world that we have the power to stand up to simply 'maintain'...the course, our course.

Subject: Re: What do we do?? From: RL To: The Dude Date Posted: Wed, May 26, 2004 at 06:25:36 (EDT) Email Address: rafaelloring@yahoo.es Message: Don't be so alarmists. Is not only we will mantain our standard of living but wi will increase it, in US and developed countries. This pessimistic views repeats over and over. It's sounds exacltly like those concerns with Japan in the 70's and 80's Yes, There are ways to compensate those losing their jobs and that is what we do in Europe, but then you create disincentives for the creation of new jobs and to work, that have put europe in the so called euroesclerosis(higher long run unemployment) I think there has to be some kind of help but it has to be done carefully to avoid those problems. Anyway I believe this apocaliptic statements are misplaced. I see more dangers to economic growth from oil prices than from outsourcing. RL

Subject: Besides Platitutdes.. What?? From: David E... To: RL Date Posted: Wed, May 26, 2004 at 13:55:14 (EDT) Email Address: Not Provided Message: Yes, it does sound like the 80s and 90s (not 70s & 80s). It is easy to be relaxed if your ox is not gored. Here's a damage report - pensions disappeared for private sector jobs, low-paying service jobs up, job security down, productivity up dramatically but not shared with labor. Keeping our standard of living has required moving from one-earner to two earner families. These are huge losses from my perspective. From the working folks perspective the last 20 years have not been good. Bad news is that white collar folks that think they have nothing in common with the blue collar folks are going to get outsourced this time. A lot of jobs here, both low paying and especially high paying jobs are targets for outsourcing. It seems to me that this wave of outsourcing has broader implications than the last wave. The last wave was tough, this one will be tougher. I am not being alarmist. I am just asking what is the plan? 'work harder and study more' sounds like platitudes to me. Americans already work too hard, 'work smarter' is better. But to 'work smarter' a plan is needed.

Subject: Re: Besides Platitutdes.. What?? From: The Dude To: David E... Date Posted: Thurs, May 27, 2004 at 17:30:46 (EDT) Email Address: nma@hotmail.com Message: http://www.djindexes.com/jsp/avgDecades.jsp?decade=1990;

Subject: Re: Besides Platitutdes.. What?? From: The Dude To: The Dude Date Posted: Thurs, May 27, 2004 at 17:34:26 (EDT) Email Address: nma@hotmail.com Message: 0 - 1992 (DJI) = ± 3,000; 1992 - 2000 (DJI) = ± 11,000 - 3,000 = ? (Why?)

Subject: What?? From: David E... To: The Dude Date Posted: Thurs, May 27, 2004 at 18:16:58 (EDT) Email Address: Not Provided Message: What does DJI have to do with Standard of Living?

Subject: Re: What?? From: The Dude To: David E... Date Posted: Thurs, May 27, 2004 at 18:26:56 (EDT) Email Address: nma@hotmail.com Message: Give me a definition of 'Standard of Living'...

Subject: Re: What?? From: David E... To: The Dude Date Posted: Thurs, May 27, 2004 at 21:15:22 (EDT) Email Address: Not Provided Message: I have a problem, government quit publishing in early 1980's. I am left with is my list of things that have gotten worse.

Subject: Re: Besides Platitutdes.. What?? From: jimsum To: David E... Date Posted: Thurs, May 27, 2004 at 17:14:32 (EDT) Email Address: jim.summers@rogers.com Message: I don't see how globalization caused any of the problems in your litany of how the rich are using their political connections and exploiting the system to get even richer. U.S. executives do not get paid so much because they can point to Chinese executives and say they deserve to get paid the same; U.S. executives get paid more than any others in the world. If anything, competition from foreign executives might reduce U.S. salaries. Good for Americans or not, there is nothing you can do avoid global competition. Some sort of protectionist 'buy-American' campaign might boost sales in the U.S., but it is likely to cost sales in the rest of the world. You can rig the rules in the U.S. so that American suppliers have an advantage; but someone outside the U.S. will buy from the cheapest supplier, which is unlikely to be an inefficient U.S. supplier. Global trade will happen whether the U.S. participates or not. I don't understand why the economic benefits of trade only apply within the borders of a country and disappear outside the borders. Let's reduce these protectionist arguments to a personal level: Why should I buy my clothes and food from someone else; won't I maximize the employment prospects for myself (the only employment that ultimately matters) if I employ myself to make everything I need? I don't think you would agree that an economy that consisted entirely of individual who never trade would be better than the one we have. Forget reducing globalization, imagine how much employment would increase if we passed a law requiring that everyone grow their own food!

Subject: Re: Besides Platitutdes.. What?? From: David E... To: jimsum Date Posted: Thurs, May 27, 2004 at 18:16:03 (EDT) Email Address: Not Provided Message: Jimsum, Thanks for the little lesson in global trade. But I already knew that. I know “protectionism” is bad. I was responding to RL’s comment “Is not only we will mantain our standard of living but wi will increase it, in US and developed countries”. The probable affect on the standard of living is the subject. And that is what RL and I were discussing. As a reminder, here is my list of things that have gotten worse not better from the last wave of outsourcing. Pensions disappeared for private sector jobs, low-paying service jobs up, job security down, productivity up dramatically but not shared with labor, medical coverage as percent of population down, two jobs needed instead of one. Your comment about high US executive pay was disingenuous. Chinese executives do not compete with US executives. Chinese products compete with US products, that is the game. US executives have the power to set their own wages. It is no surprise that they set their wages very high. The last wave cost us “x” in standard of living. This wave could cost us many “x”. My question is what should we do to mitigate the declines in our standard of living. RL suggested we work harder and study more. I wrote that sounds like platitudes. Why shouldn’t we have an economic plan for the coming destruction and rebirth of our economy? Good people, with bad luck, will lose their careers. If we don’t have a plan to train them for new careers the whole country will suffer because of the lost opportunity for high value additions to our GDP.

Subject: Re: Besides Platitutdes.. What?? From: jimsum To: David E... Date Posted: Fri, May 28, 2004 at 15:12:05 (EDT) Email Address: jim.summers@rogers.com Message: Well maybe you can give me an economics lesson. How does trade lower the standard of living, if you can simply refuse to trade? As I recall, the gist of the theory of comparative advantage is that by specializing in producing goods where you have a comparative local advantage and trading for ones where you don't increases your income, regardless of whether you have an absolute advantage in producing any of the traded goods. Maybe the average incomes of Americans will go down with increased global trade; but the standard of living will not go down if prices decrease even faster than incomes. Americans are doing just fine from global trade, it is just a convenient scapegoat. The U.S. is coming off an unsustainable borrowing binge, fuelled by low interest rates and supported by bubbles in the stock market and in house prices, along with help from federal and state government budgets. If the U.S. standard of living is declining, it is because Americans aren't borrowing and spending with quite the same abandon as before. Imagine the decrease in the standard of living when not only do Americans live within their means, but they start to pay down debt as well. Some of the benefits of easy financing do escape America when some of the borrowed money is spent on foreign goods; but the economic benefits that are lost through global trade are a much smaller factor than a slowdown in the rate of borrowing. If you don't buy the easy credit explanation, here's an alternate one. America's economic power allowed it to set the terms of trade so that almost all the benefits of global trade went to the U.S. Perhaps other countries are now managing to grab a bigger share of the benefits and Americans are confusing a reduction in benefits with an actual cost. The major complaints seem to be about outsourcing computer jobs. Until recently almost all computer companies were U.S. based and employed Americans using profits earned from all over the world. Outsourcing is simply allowing the foreign countries that are the source of some of the profits to keep some of those profits.

Subject: Re: Besides Platitutdes.. What?? From: Pete Weis To: David E... Date Posted: Thurs, May 27, 2004 at 23:20:13 (EDT) Email Address: Not Provided Message: 'Good people, with bad luck, will lose their careers.' I don't think there is a lot of real disagreement on this board with regard to protectionism and its negative effects. I think the disagreement relates to the degree of economic pain that globalization will bring. Some of us believe there will be much more hardship to be endured in the coming years than do others. From your postings, David E., I sense that, like myself, you see a lot of trouble ahead. Inevitably, globalization will bring much anger among large segments of populations of nations like the US who have enjoyed being at the top of the heap for so long. There will be little understanding (or even a desire to understand) why it is happening - only that it is causing a lot of 'misery'. Global corporations are being squeezed by the higher costs of energy and raw materials. The only way they can effectively cut costs quickly and with little expense is to decrease their labor costs. The average wage of a Chinese factory worker is about $1.00 a day (correct me if I'm wrong). The average wage of a US factory worker is about $15.00 a day. This is a staggering difference. The reality is that nearly all manufacturing jobs will have departed the US and Europe before very long. Most white collar jobs can be exported to countries like India and China for much less cost. The very rapid advances in communications and computers have made this very rapid migration of jobs possible. This is not like anything we have experienced in past economic history. But this is only half the story. This loss of manufacturing has been occuring for some time here in the US. We have been running a trade deficit for around thirty years and with easier and easier credit our per capita consumption has steadily increased. Bill Gross of PIMPCO in a recent piece entitled 'Circus Game' shows a graph of 'Total Credit Market Debt (all sectors) as a Percentage of US GDP'. It shows a very high peak (270%) just after 1929 and then a low level (less than 150%) from the late 30's through the mid 80's. Then we get a steep rise through the present to a level of 300%. I'm sure others who visit this site have seen this chart since it is available on the federal Reserve site as well as many other internet locations. Anyway, the other half of this story is the mountain of debt we have accumulated in order to ward off the lowering of our standard of living since we produce less than we consume. When you have a steady, rather rapid erosion of jobs, rising energy costs, and climbing interest rates, the ability to service this record level of debt is eventually destroyed. I agree with David E that we have a really big problem here. And it is really the combination of all these factors.

Subject: Re: Besides Platitutdes.. What?? From: David E... To: Pete Weis Date Posted: Fri, May 28, 2004 at 20:01:03 (EDT) Email Address: Not Provided Message: Thanks Pete, I am very happy for your post, because I was about to give up. I am hopefully looking forward to a closer examination of the issues. p.s. I am sure PIMPCO was a typo, I read Bill Gross every month and he is a very respectable guy.

Subject: Re: Besides Platitutdes.. What?? From: Pete Weis To: David E... Date Posted: Tues, Jun 01, 2004 at 00:01:34 (EDT) Email Address: Not Provided Message: Sorry. 'PIMPCO' was a typo. Perhaps it was a subconscious reference to the Wall Street crowd in general. I believe Bill Gross and PIMCO are both very reputable.

Subject: Re: Besides Platitutdes.. What?? From: RL To: Pete Weis Date Posted: Fri, May 28, 2004 at 08:46:25 (EDT) Email Address: rafaelloring@yahoo.es Message: Nice post: 'When you have a steady, rather rapid erosion of jobs (look at the positings on the last PK's article), rising energy costs, and climbing interest rates, the ability to service this record level of debt is eventually destroyed.' ok there are many problems ,but if we focus on the competition from asian countries we'll end up like in the 30's, if we try to find constructive solutions we may not. I don't remember suggesting working harder on anything like that. In fact, I think the US could use some money instead of military spending to be more generous with those affected by globalization, but that is not a solution. The thing is that there is no way we can stop changes but to adapt. The Standard of living depends basically on the efficiency we produce goods and services, and this in the long run will increase with globalization. yes, yes I know...in the long run we are all dead, but we are the long run of our grand parents and our sons are our long run, ain't that pretty?

Subject: Re: Besides Platitutdes.. What?? From: Pete Weis To: RL Date Posted: Fri, May 28, 2004 at 10:27:45 (EDT) Email Address: Not Provided Message: RL. I hope somewhere along this course we can come up with some effective way of applying damage control. Right now, with all-speed- ahead on the money supply, I'm very concerned about all those bergy bits looming out there in the fog - might be a big one out there, somewhere, lying in our path. Trouble is, we have a rogue dreadnought, the USS Deflation, bearing down on us from astern. What worries me the most - George W's on the helm and Al Greenspan is his navigator.

Subject: two suggestions From: Nat To: Pete Weis Date Posted: Fri, May 28, 2004 at 12:19:35 (EDT) Email Address: Not Provided Message: Pete and RL: I have enjoyed the exchange. The current administration is neither inclined nor competent enough to solve this problem. In fact, I suspect they do not view it as a problem even if it leads to catastrophic economic consequences for a significant number of Americans. We are not part of their socio-economic community, very few Americans are. They are in power based on social and religious positions that lead many working Americans to vote against their own financial best interest. Wealth is increaingly multi and international. Money is vastly more mobile than labor. If growth is in India, it makes sense for American capital to be invested in Indian jobs. American corporations owe their allegiance to profit not to the welfare of the American people, rightly or wrongly. America has always leaked jobs like a sieve, but it's capacity for generating new and more lucrative jobs has been great. I fear that the loss of good jobs will not be offset by the jobs creation engine. And our borrowing and trade imbalance seem to be unmanageable in the not so distant future. A couple of thoughts: the first is that small town America benefits by the lower cost of living and the benefits of high tech. Access to low cost, high speed internet service in Marfa, Texas would perhaps benefit a few techies who lost their Austin jobs to move and start a new business. Small town America seed money and tax breaks would play well politically. Secondly: I think seed money (in lieu of unemploment) should be made available to those affected by lay offs to band together and reform as competitors to the companies that let them go.(Umm, I bet that last one isn't going to happen.)

Subject: Re: two suggestions From: Paul G. Brown To: Nat Date Posted: Fri, May 28, 2004 at 18:13:59 (EDT) Email Address: Not Provided Message: > Money is vastly more mobile than labor. Y'know, this is a very interesting (nay! profound) observation. I googled a bit, and found this. Turns out that it isn't so much that capital has become more mobile (capital flows are acually less in relational to national output today than they were in 1913) as much as it is that labor has become less mobile. If we imported (through immigration) all those Indian citizens now being used as cheap outsourcing labor, we would make a significant dent in the problem. Odd, isn't it? Economic reasoning leads us to a conclusion that runs entirely counter to the main thrust of conventional wisdom (keep the immigrants out and keep the jobs at home). Not really an argument or an idea. More an observation.

Subject: Re: two suggestions From: Nat To: Paul G. Brown Date Posted: Fri, May 28, 2004 at 20:03:28 (EDT) Email Address: Not Provided Message: Wow. Very interesting google-find. I hadn't thought of it in quite that way. I was actually thinking more from the other direction: the growing difficulty for our labor to go somewhere else. When Austin competes against Bangalore for a high tech job the technical measures might be close, e.g. access to bandwidth or an educated workforce. Where Austin now loses out is cost of labor because of cost of living. Twenty years ago when Austin was the lost cost competitor (cheap housing, cheap entertainment, etc.) vs. Boston and Silicon Valley, the world moved here. Now the guys who are out of work can't move to where the work is for a host of reasons. But Bill Gates and Paul Allen can buy into a both mature businesses and start ups overseas 'til the cows come home. The fact that the guy doing the work is Indian or Pakistani or Texan is immaterial to them. But it matters to the community of Austin and the guy who is the new night manager at IHOP who used to work at garden.com. I am not sure there are any more Austins out there in the US. We cost too much. Even state work here is going overseas (the new human services system that may someday actually be implemented has a very high subcontinent staffing level.) My thought was there are very many places in this country that were either losers in some prior job flight or never had many people in the first place that are nice places to work and live. And are cheap... But does anyone in DC care? And how would one go about encouraging a high tech company to start up in Mason, Texas? (And, incidentally, Mason is a very nice place.)

Subject: Re: Besides Platitutdes.. What?? From: Econochick To: jimsum Date Posted: Thurs, May 27, 2004 at 18:15:54 (EDT) Email Address: Not Provided Message: Jimsum, you are likely correct in thinking that global competition will reduce the pay of senior executives - the group perceived as most out of line. There will just simply be more competition for the job. 'Buy America' has been done before. You're looking at the results. Basically, if you have the choice to buy a cheeper paper plate made in China so that you can spend more money on other things that are important to your family, you always will. But you can piss away a lot of money trying to get people to 'buy America'. Global trade is a natural economic progression like the stages of life (birth, growth, aging, death). Unnatural interruptions to the process usually cause more problems and solve none. A coping strategy is far more effective - like educating previously unskilled labour to meet the demand for skilled labour. In other words, responding to the economic change rather than fighting it. Put your energy there, it's more productive. And you make another excellent point about an economy in which no one ever trades. It's called the height of inefficiency. This is indeed the economy we had many many centuries ago and have progressed away from that. You appropriately tested the argument at the limit. Nice post.

Subject: Looks like a death spiral to me n/m From: David E... To: The Dude Date Posted: Tues, May 25, 2004 at 21:24:27 (EDT) Email Address: Not Provided Message: no message

Subject: The Great Irony From: Pete Weis To: All Date Posted: Wed, May 19, 2004 at 21:17:24 (EDT) Email Address: Not Provided Message: Here we are embroiled in a truely disasterous war in Iraq. Insiders have been sucking money out of small investor's 401K's at a prodigious rate. We have no energy policy to speak of. Environmental problems with an ongoing severe 5 year drought throughout much of the west. So what is it here in America that really gets us spun up? The cost of gas we pump into our H2's, Lincoln Navigators and mega sized pickups.

Subject: Well, so much for .... From: Pete Weis To: All Date Posted: Tues, May 18, 2004 at 22:32:28 (EDT) Email Address: Not Provided Message: Greenspan being replaced before the November elections. You wouldn't expect him to retire before November after being reappointed to a term lasting until 2008. Looks like El Gringo may be right about the next Fed Chairman being appointed by a Democratic President. Wonder if Greenspan will retire before his four years are up.

Subject: THE SARIN GAS FIND has been confirmed From: Matt To: All Date Posted: Tues, May 18, 2004 at 15:59:45 (EDT) Email Address: mamaway@yahoo.com Message: http://www.foxnews.com/story/0,2933,120268,00.html Paul Krugman said Bush lied about WMD?? Spoke a little too soon there, Paulie boy.

Subject: Re: THE SARIN GAS FIND has been confirmed From: Neal Martin To: Matt Date Posted: Tues, May 18, 2004 at 20:15:47 (EDT) Email Address: Not Provided Message: yeah, I was just waiting for some freeper to come along and starting embellishing this non-event. Sorry dude, but nobody, not even the Bush administration, claims this lone decrepit canister is evidence of a weapons stockpile. The only people who believe this shell legitimizes Bush's prewar claims are desperate zealots grasping at whatever straws they can.

Subject: Re: THE SARIN GAS FIND has been confirmed From: The Dude To: Matt Date Posted: Tues, May 18, 2004 at 18:13:46 (EDT) Email Address: nma@hotmail.com Message: (Kuwait:159 miles,Saudi Arabia:560 miles,Jordan:92 miles,Syria:377 miles,Turkey:191 miles,Iran:947 miles)SUM:2326 miles

Subject: Re: THE SARIN GAS FIND has been confirmed From: Paul G. Brown To: Matt Date Posted: Tues, May 18, 2004 at 16:38:28 (EDT) Email Address: Not Provided Message: 600 US Dead 100 Allied Dead 10,000 Iraqi Dead $US 200 Billion down the drain The animus of the rest of the free world, and the enduring loathing of the muslim world. No Exit Strategy Lies (troop numbers) lies (links to Al Queda) lies (mushroom cloud) incompetence (secure the nuclea sights) incompetence (get oil and electricity flowing) incompetence And now we've found one defective artillery shell containing a substance manufactured in larger quantities by a Japanese cult led by a blind fatty that was probably left over from the first gulf war (or the Iran Iraq war, meaning it might have been supplied by the US), and it's all OK? Y'know, one day, we're all gonna look back at this and laugh. Or cry. Hard to say which, just now.

Subject: Re: THE SARIN GAS FIND has been confirmed From: Smith To: Paul G. Brown Date Posted: Wed, May 19, 2004 at 18:07:05 (EDT) Email Address: Not Provided Message: You're right. We will look back on this and cry after the next major attack in the US because of idiot cowards like you who could do nothing but whine and complain about the war on terror.

Subject: Re: THE SARIN GAS FIND has been confirmed From: Jonathan To: Smith Date Posted: Sat, May 22, 2004 at 10:06:38 (EDT) Email Address: jonathan@lyingsocialistweasels.com Message: You're right. We will look back on this and cry after the next major attack in the US because of idiot cowards like you who could do nothing but whine and complain about the war on terror. --- Truly hilarious, coming from an anonymous internet poster, afraid to even provide an email address, who has probably never served the country in any way a day in his life. No, Smith, what's cowardly is being too afraid to think, and instead blindly following what the desperate right-wing loons and the criminals in the White House spout. What's idiotic is ignoring all evidence and letting some extremist tell you what you think. Moron. You're taking up valuable air that normal people could be breathing. Knock it off.

Subject: Re: THE SARIN GAS FIND has been confirmed From: Paul G. Brown To: Smith Date Posted: Wed, May 19, 2004 at 20:54:55 (EDT) Email Address: Not Provided Message: I know you're not going to read this, Smith, but what was the connection between Iraq and the war on terror again? Was Iraq involved in the September 11 attacks? What about World Trade Center '93? Or the Millenium plot? Or the Cole? Or Bali? Or Madrid? Or the shoe bomber? I am as keen as anyone that we prosecute the war against the islamo-fascists to the last degree. But this lot are a bunch of incompetent liars who are *losing* that war.

Subject: Re: THE SARIN GAS FIND has been confirmed From: The Dude To: Smith Date Posted: Wed, May 19, 2004 at 19:19:12 (EDT) Email Address: nma@hotmail.com Message: 'We will look back on this and cry after the next major attack in the US because...' What about Spain? Current hint:http://www.xmission.com/~dderhak/index/moors.htm

Subject: ...and beyond From: Econochick To: Paul G. Brown Date Posted: Tues, May 18, 2004 at 21:37:38 (EDT) Email Address: Not Provided Message: Paul, now now. I'm refusing off the bat to get into partisan discussions. However, as a stand alone point you failed to mention that Sarin was one of the things that Saddam swore on his mamma's grave (so to speak) that he got rid of. The little insurgent who launched it didn't know it was a sarin bomb (probably looted). Saddam was a bad bad 'man' - no news there. However, as for your statistics on the death toll I wanted to add one more thing to think about: fewer people have died during this Iraq war and occupation than in the same period of time during Sadman's reign. Scary. This, of course, doesn't include the Iran/Iraq war and it doesn't include the people he tortured to within an inch of their lives. Incompetence? Ignorance more like. We are fully competent to carry out any task but we have to know what we are doing. Agree or disagree with the war, now that we are in this pickle what the hell are we doing apologizing to Egypt and Jordan for Abu Ghraib anyway? We should have apologized directly and ONLY to the Iraqis. What Bush did by apologizing to other Arabs feeds into the the whole Pan Arab bulls**t that brought about the likes of Hussein in the first place and has kept the Arabs sliding back into the stone age for hundreds of years. But I wonder if any American would have avoided that mistake. We are ignorant!!!

Subject: Typical of current wingnut talk... From: Jonathan To: Econochick Date Posted: Sat, May 22, 2004 at 10:27:42 (EDT) Email Address: jonathan@lyingsocialistweasels.com Message: Paul, now now. I'm refusing off the bat to get into partisan discussions. However, as a stand alone point you failed to mention that Sarin was one of the things that Saddam swore on his mamma's grave (so to speak) that he got rid of. The little insurgent who launched it didn't know it was a sarin bomb (probably looted). Saddam was a bad bad 'man' - no news there. However, as for your statistics on the death toll I wanted to add one more thing to think about: fewer people have died during this Iraq war and occupation than in the same period of time during Sadman's reign. Scary. This, of course, doesn't include the Iran/Iraq war and it doesn't include the people he tortured to within an inch of their lives. Incompetence? Ignorance more like. We are fully competent to carry out any task but we have to know what we are doing. Agree or disagree with the war, now that we are in this pickle what the hell are we doing apologizing to Egypt and Jordan for Abu Ghraib anyway? We should have apologized directly and ONLY to the Iraqis. What Bush did by apologizing to other Arabs feeds into the the whole Pan Arab bulls**t that brought about the likes of Hussein in the first place and has kept the Arabs sliding back into the stone age for hundreds of years. But I wonder if any American would have avoided that mistake. We are ignorant!!! --- Sorry, Econochick, but this is a losing argument. It's typical of one being put forth by wingnuts (among several contradictory memes) that things aren't as bad now as they were under Saddam. 'Look! Saddam tortured people worse than we tortured them!' And now, evidently, 'More people were killed under Saddam than under us!' Of course, neither addresses whether such activities or events are acceptable under us. This sarin shell is a non-issue. For all anyone knows, it was found in a former Iran-Iraq-War battlefield, having failed to go off. It's an unlabeled relic, and hardly evidence for anything except that Saddam once had such weapons. Which we already knew. It alone was basically incapable of inflicting mass casualties (pretty much the definition of 'weapon of mass destruction') beyond the shell's ability to explode, and obscures completely the rationale put forth for going to war. We didn't attack Iraq on the grounds that a few old, stray, rusting chemical weapons artifacts from 20 years ago might still be found. What's truly amazing is that so few have turned up, in a country that once swam in and used them in a devastating war. 'Incompetence' is the perfect word for what's going on in Iraq. The administration was warned over and over and over again by competent people to whom they should have listened that things would not go swimmingly and that we'd need many more troops than we used. They didn't listen. Worse, Bush's instant response to the Fallujah incident was to order the city nailed. A truly stupid move, by any measure. Again: raw incompetence. This war and occupation have become a monument to incompetence. I don't disagree with 'ignorance', too, but it's the job of our leaders to know at least a little about the consequences of what they're getting us into, and not ignore anything they don't want to hear. So any way you measure it, we're back to incompetence...

Subject: Re: ...and beyond From: Nat To: Econochick Date Posted: Wed, May 19, 2004 at 21:36:38 (EDT) Email Address: Not Provided Message: Sorry, Econochick. No counting the Iran/Iraq war in any of these discussions: that one was ours, too! Saddam was our anti-Ayatollah poster boy and we supplied his arsenal and technology and cheered from the (barely) sidelines. The very nice photo of a younger Rumsfeld shaking Saddam's hand is out there on the web. Saddam was our buddy until Kuwait and the Bush/Glaspie screwups. So some of that Saddam body count is on our side of the cosmic ledger, too. As for the number of dead in Saddam's purges etc., I have seen estimates all over the map, all truly horrible. Many count the war in the numbers. But many, many of our best buddies have been and continue to be murderous thugs. Where is the line drawn in comparing atrocities to make the decision for war and occupation? I suspect our conservative leaders fancy themselves wordly enough to tolerate unlimited atrocities among friends. The Saudis behead women for marrying outside of the royal family. Nice guys. At least one has unfettered access to the Oval Office. Saudis were the 9/11 terrorists and they fund terrorism to a vastly greater degree than Saddam ever did. War was the answer to other strategic aims (as in dominating the oil fields) and all the humanitarian claptrap was just so much posturing. IMO Saddam's thuggery was just a useful excuse to justify an invasion truly motivated by other goals, none of them worthy of America. The current Iraqui civilian casualties (which we don't feel the need to officially count) considerably outnumber the 9/11 toll. They have a guerrilla war in their streets every day, and will until we leave. This has been a spectacularly bad idea executed with uncommon stupidity. The cold war lesson was democracy will win in the long run and we have forgotten it.

Subject: Re: ...and beyond From: Mik To: Econochick Date Posted: Wed, May 19, 2004 at 17:54:12 (EDT) Email Address: Not Provided Message: Ayi Caramba Econochick, Your statement about how few people have died in comparison to Saddam's reign seems to justify a reasoning for going into Iraq in the first place? If that is the reasoning, the US should have chosen to go into North Korea first (and at least we know they do have WMD). Just because there is a tyrant in power does not mean we should invade. If we are to invade every country where there is a tyrant, then Bush has got a lot of serious work to do in places like Turkmenistan, Zimbabwe, North Korea... and this list goes on. Also if that is the excuse then please he should have used it from the beginning when he approached the UN for the first time - and not the WMD story, or the bull story he gave in his state of the union address about Iraq's attempt to buy nuclear material from Niger.

Subject: Re: ...and beyond From: Econochick To: Mik Date Posted: Wed, May 19, 2004 at 18:07:15 (EDT) Email Address: Not Provided Message: Not the point, Mik. I just pointed that out as a sad fact. 5-7 million people have 'gone missing' in the past 20 years in Iraq. The point was that one asshole could kill more people than a war in the same time period. I'm not getting into whether or not the war was a good thing.

Subject: Re: ...and beyond From: Paul G. Brown To: Econochick Date Posted: Wed, May 19, 2004 at 21:05:46 (EDT) Email Address: Not Provided Message: Back in the 1980's, I was writing letters and struggling to draw attention to the henious nature of the Baathists in Iraq. It achieved butkas. And while it was certainly true that the way the embargo was being manipulated by the Saddamite state in a way that ensure the misery and death of thousands of people (particularly children) it does not follow that an invasion was the best way to resolve that problem (although I was in favour of military intervention in Iraq, and I am now in favor of it in Zimbabwe). It's about competence, more than anything else. I think there is a broad consensus in terms of the goals and the strategy, here. The way to defeat islamo-fascism is by bringing about political change in the middle-east. But you don't win by lying, conniving, stealing, invading without a clue, and generally mucking it up at every turn. If I ran my work projects with the mix of deceit, cluelessness, arrogance, and willful ignorance of Bush 43, I'd be out of a job. Lifetime, serial failure. Flawed human being. Worst. President. Ever.

Subject: FIFA Decision for 2010 From: Mik To: All Date Posted: Tues, May 18, 2004 at 11:39:45 (EDT) Email Address: Not Provided Message: Dude... thanks. OH YEAH !!!! The World Cup soccer is the greatest show on earth, surpassing the Olympics. South Africa currently has one of the highest crime rates in the world and a murder rate equal to a country ar war (approx. 21,000 murders a year). The SA Government has a VERY weak concept of what needs to be done to commit proper resources to combat crime. In essence they don't take crime seriously. I look to the 2010 world cup as a catalyst in forcing the SA government to wake up and do something serious about crime. The 2010 world cup is not just about pride, but a huge historical milestone in setting SA on the right course.

Subject: Re: FIFA Decision for 2010 From: The Dude To: Mik Date Posted: Mon, May 24, 2004 at 18:20:34 (EDT) Email Address: nma@hotmail.com Message: Nigeria: World Champion 2010...?

Subject: Rumsfeld to go down with the ship? From: Pete Weis To: All Date Posted: Sat, May 15, 2004 at 23:51:05 (EDT) Email Address: Not Provided Message: Or get tossed over the side before the ship (the Bush administration)sinks below the waves? It's becoming more and more apparent that members in the military heirarchy or those with access to information about inside operations in Iraq are leaking information to the press in an effort to get rid of Rumsfeld and the present civilian leadership at the Pentagon. The first indications surfaced when it was reported that top military brass went around Rumsfeld in 2003. They approached Colin Powell with a document, they wanted Bush to sign, which offered concessions to the UN to get other countries involved with helping out with security in Iraq. Colin Powell presented the document to Bush and urged him to sign, which he did. This clearly showed the growing rift between Rumsfeld and the military leadership at the Pentagon. IMO, the US military leadership is ready to 'burn' Rumsfeld to the point where his charred carcass is tossed over the side - a fitting ending for one of the very few Republican leaders to ever serve (in the 50's peace time navy). Now, sensitive information is being leaked to people like Seymour Hirsch to connect him to the perverted treatment of prisoners in Iraq. It's only a matter of time before those who pay the bills for the Republican party demand Rumsfeld's head. Of course, Wolfy gets to walk the plank as Rumsfeld is tossed over the side. How ironic. Here Cheney calls Rumsfeld the greatest defense secretary ever and Bush says Rumsfeld has done a superb job despite all the horrific mismanagement of post invasion Iraq and soon Bush will likely be strongly 'urged' to 'ask' for Rumsfeld's resignation. As Bush's numbers continue to sink, you have to wonder whether Cheney is next on the plank. There has been some speculation that Rudy Gullianni might replace Cheney on the Republican ticket if re-election was looking more grim. But you have to wonder whether Gullianni wants to step aboard this ship. I realize all of this is speculative but it's becoming more and more obvious that major shake-ups within the Bush administration will need to happen or not only will the Republicans lose the Presidency, but also the House and the Senate.

Subject: Re: Rumsfeld to go down with the ship? From: Paul G. Brown To: Pete Weis Date Posted: Sun, May 16, 2004 at 00:35:05 (EDT) Email Address: Not Provided Message: > Or get tossed over the side before the ship (the Bush > administration)sinks below the waves? Think, for a moment, about what that would mean. The same person, George W. Bush, is legally and morally 'in charge'. But by ridding the administration of Cheney/Rumsfeld/Wolfy/Rice (Perle - gone) suddenly he's electable again? I mean, who selected these people for their posts? Who interviewed them? Who's judgement of character and talent gave them their jobs? What evidence do we have that he'll do better second time around? If George W. put them there, why does it make sense to re-elect him? If George W. didn't put them there, why does it make sense to elect him? If he isn't in charge, who is? If Cheney is in charge, and he is fired, who's left? In my opinion, the evidence suggests that George W. is in very much in charge. And it is George W.'s intellectual limitations and character flaws that have turned great opportunity into a ghastly disaster, on every single policy front. The first economic surplus in a generation turned into the largest deficit, genuine international goodwill in the struggle against islamo-fascism sacrificed at the altar of an obsession, the chance to lay out new policies with respect to energy independence burnt to a oil-soaked crisp, corporate fraud left to flourish. To quote Atrois; Worst. President. Ever.

Subject: Re: Rumsfeld to go down with the ship? From: Pete Weis To: Paul G. Brown Date Posted: Sun, May 16, 2004 at 12:59:08 (EDT) Email Address: Not Provided Message: Paul. I agree with all of your points with the possible exception that George W. is 'very much in charge'. One of his speech writers who left early called him 'uncurious'. Paul O'neil called him 'unengaged' when he tried to discuss economic issues with George W. From all accounts, George W. has never had much interest in current events and has never spent much time following the news. It's my understanding that, in the early period of his life, he was never very ambitious. In the 80's he was 'set-up' with two business opportunities by family and friends - both of which failed. In the early nineties he was given a nominal executive position at Harkin when his father was president. I won't go into Harkin's troubles during and after George W's tenure - there's lots of info that can be found on the web with regard to those years. He had little, if anything, to do with the running of Harkin Energy - but his connections were obviously perceived to be of value by those who actually ran Harkin. Soon after he leaves Harkin, Carl Rove comes into the picture. Carl Rove has all the ambition that George W. never had. Rove is a character who has extreme ambition to go along with no moral self-restrictions. This was evident in the gubernatorial races in Texas as well as the presidential primaries (especially South Carolina) where John McCain became the target of a truely dishonest and vicious smear campaign. This is also evident in Rove's leaking classified information regarding the identity of a CIA agent to Novak and other reporters in a clumsy attempt to discredit evidence that Iraq had not sought uranium in Africa. George W., who makes a big deal about his 'born-again' conversion simply goes along with the Rove program. In short, I don't think George W. is the strong leader Carl Rove tries to portray to the public. Perhaps George W. has convinced himself that God has surrounded him with people who have both his interests and the nation's interests at heart. Perhaps he had much to do with the decision to invade Iraq in the first place. But I don't think he makes very many decisions in this administration - I tend to think he just goes along with the program. As for Rumsfeld, this prison scandal seems to be growing to the point where he personally is being connected to the disgusting activities of military intelligence (per direction of Rumsfeld?) and the prison guards. I don't think this is going away and at some point Rumsfeld will likely tender his resignation - Carl Rove will want this at the point where Rumsfeld becomes too much of a liability. I agree that Bush will likely lose the November elections regardless of any changes to his cabinet or his running mate. But the Republican leadership will do what ever they think is necessary to give themselves a shot at winning the election. If things are falling apart they'll make changes short of replacing Bush at the top of the ticket.

Subject: Re: Rumsfeld to go down with the ship? From: Mik To: Pete Weis Date Posted: Mon, May 17, 2004 at 11:17:37 (EDT) Email Address: Not Provided Message: Pete, I think what Paul put across is that whether or not W Bush did 'run' the system, there is a mess and Bush should be out as a result. The question I ask is simple, 'Do you think the majority of Amercians see it that way?'

Subject: Re: Rumsfeld to go down with the ship? From: Pete Weis To: Mik Date Posted: Mon, May 17, 2004 at 23:08:31 (EDT) Email Address: Not Provided Message: Mik. I agree incompetence, in George W's case, does not get him off the hook. I certainly don't think he should be re-elected and it would take an incredible turn of events for him to be re-elected, IMO. IMO, the whole gang - George W, Cheney, Rumsfeld, Wolfewitz, Ashcroft, etc will end up going down in history as the foremost malevolent, malfeasant, incompetent bunch of American leaders in history. Atleast, I hope this is as bad as it gets - up till now, I believe this group wins it hands down. The one saving grace is that we get to un-elect them in the November. Unfortunately, the next President will need to perform miracles. It's amazing to see how much support George W still has here in the US, but his support is falling rapidly. I think, at some point before the November elections it will be evident, even to the most ardent Bush supporters, that he has little to no chance of being re-elected.

Subject: Re: Rumsfeld to go down with the ship? From: Mik To: Pete Weis Date Posted: Tues, May 18, 2004 at 11:51:37 (EDT) Email Address: Not Provided Message: Pete, Yeah I agree with you. The problem is that some time back I was frequenting another board and was stumped at the attitude of some people on how Bush is doing the right thing, 'We are now going to sort out these Arabs once and for all.' The problem was the prevelence of people like this. Bush is starting to use words like, 'This is a historic turning point..' It almost sounds like Bush wants to slot himself into the position of great American Presidents like Ike or even Lincohn himself. And people are buying it. Now granted I have seen that Bush has dropped significantly in the polls, but he is still up there almost neck and neck with Kerry. So I sit back and say, 'Oyi vey....'

Subject: Re: Mik From: the Dude To: Mik Date Posted: Mon, May 17, 2004 at 17:20:25 (EDT) Email Address: nma@hotmail.com Message: Mik:http://www.fifa.com/en/worldcup/index/0,3360,101468,00.html?comp=WF&year=2010&articleid=101468 ;)

Subject: Outsourcing From: Bobby To: All Date Posted: Wed, May 12, 2004 at 14:25:31 (EDT) Email Address: robert@pkarchive.org Message: This is something I wrote regarding an article about outsouring posted by Brad DeLong here In pre-Krugman trade theory, India's apparent comparative advantage in 'data mining, data warehousing, business intelligence and knowledge management' is due either to (1) the possible fact that our productivity in those sectors relative to India's is worse than that of other sectors in the economy or (2) India is more abundant in factors like skilled labor that are intensively empoyed in these sectors. Either way, it translates into India having a greater supply of the goods 'data mining, data warehousing, business intelligence and knowledge management' relative to other goods, so they can sell these goods at a lower relative price. Outsourcing is better than creating controls that cut off this outsourcing. Without controls, those factors employed previously in areas where we don't have comparative advantage (call them 'import goods') can go into other sectors where we do (call them 'export goods'). We will therefore produce more 'export goods' and fewer 'import goods.' A lower relative price of 'import goods' implies that the world price of 'export goods' in terms of 'import goods' is greater than under protection against outsourcing. When measured in terms of import goods, the value on the world market of what we produce is greater compared to controlling outsourcing. Also when measured in terms of the export good, the value on the world market of what we produce is greater compared to protection. Since the value of what we consume must equal the value of what we produce, this implies that, in principle, our country can consume more of both import and export goods compared to protection against outsourcing. More formally, our country's budget constraint is allowed to rotate outwards when we do not engage protection, and this allows our representative consumer to consume bundles of export and import goods that yield higher utility compared to controls on outsourcing. In other words, the social welfare of all of society has increased. Some individuals may lose welfare while others may gain, but the gains are greater than the losses, and we can make everyone better off if the government makes appropriate transfers from the winners to the losers. Yes some of those U.S. factors, usually labor, who were in those industries that left the U.S. for India may be hurt either because they are stuck in import-competing industries unable to move to others or because they aren't employed intensively in industries where the U.S. has comparative advantage. However, labor is most often hurt by technological change, and changes in consumer preferences. When someone loses their job due to foreign competition, it is no more a tragedy than if he lost it due to one of these other factors. Moreover it is very difficult to tell whether technology trade is the culprit when a worker's wage decreases or he loses his job -- it's not always as stark as someone's factory moving abroad. These are two reasons why all dislocations of labor, whether due to trade or technology, should be all dealt with together in one program of better social insurance and programs to compensate them for their hardship, which has helped society as a whole.

Subject: Re: Outsourcing From: RL To: Bobby Date Posted: Mon, May 17, 2004 at 07:44:42 (EDT) Email Address: Not Provided Message: Can you copy-paste Bard Delong's post?

Subject: Re: Outsourcing From: Bobby To: RL Date Posted: Mon, May 17, 2004 at 12:49:00 (EDT) Email Address: robert@pkarchive.org Message: Someone has obviously hacked into my account at hotboards. I'll get rid of the obscenity there. Sorry about this. The link to DeLonf's post is there in the original post now and also below http://www.j-bradford-delong.net/movable_type/2004_archives/000811.html

Subject: Keynes on war??? From: Rune Løgstrup To: All Date Posted: Tues, May 11, 2004 at 13:04:50 (EDT) Email Address: runel@net.dialog.dk Message: Really enjoyed 'The Great Unraveling'. I have a question though: Can keynesian militarism explain the 2. war i Iraq and can't it be one of the reasons why USA wanted the war so badly? Afterall a higher planned expenditure makes the interest rate go down, the income to go up and the overall economi, which didn't looked good at the time, to look a little better? I could really use some great links on this question. All the best /RL

Subject: Re: Keynes on war??? From: Bobby To: Rune Løgstrup Date Posted: Tues, May 11, 2004 at 13:38:16 (EDT) Email Address: robert@pkarchive.org Message: If anything this will cause the nominal interest rate to increase, though it is expansionary. What happens is that this increase of government expenditure on the war is an outward shift of IS. However, increased output implies an outward shift of money demand in the money market, that is we go up the LM curve. Therefore IS meets LM not only at a higher output but also at a higher interest rate. If we are at a point on LM that is rather flat, as may be so right now, this effect is not large, so interest rates increase only a little. The only way one could make an argument that the war decreases interest rates is that it somehow makes LM shifts outward so much that the interest rate decreases. To make LM shift outwards so much you'd have to argue that war, for some reason, makes the Fed increase money supply drastically or something happens in financial markets due to the war that makes money demand decrease drastically. I don't know of any plausible argument for this.

Subject: Re: Keynes on war??? From: The Dude To: Bobby Date Posted: Wed, May 12, 2004 at 18:25:11 (EDT) Email Address: nma@hotmail.com Message: 'Afterall a higher planned expenditure makes the interest rate go down, the income to go up and the overall economi, which didn't looked good at the time, to look a little better? ' Short term endogenous! economy, yes.Long term 'still' endogenous! economy, an 'artificial' yes.

Subject: Re: Keynes on war??? From: Rune Løgstrup To: Bobby Date Posted: Wed, May 12, 2004 at 10:02:53 (EDT) Email Address: Not Provided Message: Thanks for the answer, you really helped me out. You're right the interest rate will increase after all. But what about the multiplier-effect? Won't it create some jobs and thereby maybe pull the economy out of the stagnation. I just think that you can see some Keynes-elements ind the american fiscal-politic.

Subject: Re: Keynes on war??? From: Bobby To: Rune Løgstrup Date Posted: Wed, May 12, 2004 at 11:05:17 (EDT) Email Address: robert@pkarchive.org Message: Good question. The multipler effect occurs, but a large part of it is choked off by increasing money demand and increasing interest rates in the money market. Put another way, if the LM curve were completely flat, the spending multiplier would be 1.93, but the steep LM curve the occurs in reality cuts the spending multiplier to .6 -- this particular estimate comes from the DRI model. A good link on this is here A caution on the previous multiplier estimates: In standard IS-LM an increase of money supply will shift the LM curve. DRI puts a slightly different interpretation on LM. DRI models the Fed's behavior, which stylistically (this is my own way of thinking about it, and this terminology is not in the model) can be classified as 'not normal,' when the Fed adjusts money supply to do things like *change* its interest rate target for fighting recessions or inflation and 'normal' which are Fed actions that still involve adjusting money supply such as *staying* at its interest rate target. Normal actions will not shift LM while 'not normal' ones do. So the .6 estimate comes when the Fed is engaging in only 'normal' behavior. Therefore this .6 estimate does not assume no money supply adjustments.

Subject: Re: Keynes on war??? From: Rune Løgstrup To: Bobby Date Posted: Wed, May 12, 2004 at 11:48:25 (EDT) Email Address: Not Provided Message: Thank you, Bobby...a great way to learn more about the key-concepts ind the IS/LM.curve. You've been a great help. Sincerly Rune

Subject: Re: Keynes on war??? From: RL To: Rune Løgstrup Date Posted: Thurs, May 13, 2004 at 04:21:56 (EDT) Email Address: rafaelloring@yahoo.es Message: All this is stirctly correct but I somehow see it as handicaped debate. IS/LM model was a way of explaining theories, mainly Keynesian, to students. just a model that can help us explain some ideas but we should extend our discussions out of it. Before the second world war the Fed turned aorund it's monetary, policy expanding the monetary base but america was in a deflationary trap, so cheap money wasn't effective. At the end was the war that pushed demand and put the economy in motion. To speculate that this was a reason to go to war is absurd,(remember pearl harbour?) in fact US was very reticent to go to war. I believe economic reasons for conflicts are normaly overstated (marxsim influence), politcal reason are normaly much more important. In Iraq I give it a 50-50%

Subject: Bush's foreign policy is hurting... From: The Dude To: All Date Posted: Mon, May 10, 2004 at 19:00:52 (EDT) Email Address: nma@hotmail.com Message: By Robert Dujarric Bush's foreign policy is hurting US business Millions of dollars are flowing from America's corporate executives into the campaign coffers of George W. Bush.It seems logical that business executives - whose taxes he cut significantly - should support him.But a glance at the Bush administration's foreign policy - including on Iraq and world trade - reveals that he president's action could significantly harm the interests of US investors. The war in iraq is harming the American economy.The US has already wasted about $200bn in a futile effort to turn Iraq into a 'liberal' democracy and Mr Bush is now asking for a further $25bn.Until US troops leave, it is likely that US taxpayers will have to contribute hundreds of billions of dollars more to this ill-fated enterprise.Mr Bush's pledge to establish 'democracy' in Iraq is essentially a commitment to keeping large numbers of troops there - potentially for a decade - with little hope of success. Mr Bush's Iraq war stands in contrast with his father's.The war to liberate Kuwait was justified and the elder Bush, who understood diplomacy (hi Paul), convinced the allies to shoulder almost the entire financial burden of the conflict. His son, however, initiated the war for dubious reasons and thus secured almost no substantial contributors in 2003-04.Even nations that sided with the US, such as Japan, contributed far less funding this time than in 1990-91. Moreover, Mr Bush is putting at risk the international system which underpins world stability and US corporate profits.America leads a system that upholds the peace of Europe and the Pacific Rim - where most of the world's wealth outside the US is generated - and helps mitigate political and financial crises thoughout the world. This system, anchored by Nato and alliances with Japan and 'Korea', relies on US military power.But it also includes economic organisations such as the World Trade Organisation and the International Monetary Fund.These institutions need both American hegemony and the co-operation of US allies to work well.The unilateral (ab)use of American power for a misguided purpose has crippled, though not yet destroyed, this system.Friction between Washington and Paris over Iraq generated much attention, but the real failure was the diplomatic crisis over ties with Germany.The diplomatic aspect of the war also hurts American business(FDI's).International trade and investment flourish because the US leads regional and global institutions that protect the world from anarchy.Though the US is incredibly powerful, it cannot ignore its allies if the system is to work well.Mr Bush behaves like a managing partner who thinks that, as the largest shareholder, he can act as he pleases without considering his junior partners.At some point, this attitude could shatter the international order, with dire consequences for the stability companies need to make profits. Trade policies have also taken a battering under Mr Bush.His tariffs on steel undermined the WTO and hurt the profitability of steel - buying companies.Though later rescinded, the tariffs set a dangerous precedent.As US president, Mr Bush's actions have generally had far more impact than those of any other single leader. In Europe, The Bush administration's commitment to reducing US military presence in Germany could fray the ties between the US and some of its most important economic partners.There cannot be a lasting transatlantic partnership without a robust US military presence (NATO) in western Europe. Finally, America's new visa policies harm US industry.US companies are now encountering difficulty bringing foreign employees to the US, while overseas customers in some countries cannot visit their American suppliers.Other new restrictions would prevent some of the brightest foreign students from studying in US universities- and possibly contributing to American expertise.If the Microsofts, Intels, and Googles of this world cannot count on a continuing inflow of foreign graduates and face restrictions in hirinhg foreigners, their profits are likely to fail substantially. Right now, Mr Bush is trying to limit the damage from the escalating controversy over US millitary abuse of Iraqi prisoners.But this and other grim developments are hurting the alliances, relationships and economic strenght that US corporations rely on to succeed.American executives, therefore, need to ask themselves if Mr Bush's re-election is in the best of their shareholders. (The writer is co-author of America's Inadvertent Empire, just published by Yale Univeristy (Hi Bobby) Press.

Subject: Still Oil for dollars? From: El Gringo To: All Date Posted: Sat, May 08, 2004 at 21:59:49 (EDT) Email Address: nma@hotmail.com Message: 'Saddam Hussein sold oil in Euros instead of US dollars. (Recknagel, Iraq: Baghdad moves to Euro - Radio Liberty/RFE press release 11/1/00) Venezuelan President Hugo Chavez bartered oil with other Latin American countries and Cuba; soon afterward he faced a Bush Administration backed coup. (Henderson, Globocop v. Venezuela's Chavez, Interpress service 4/2002) The US dollar is the currency of oil - ALL oil. A sixty year monopoly guarantees that every transaction for a barrel of oil on the globe is done in US dollars. Oil sold or traded in anything other than US dollars will have a dramatic NEGATIVE economic effect on this country and the world. Consider that a nations economic fragility is shown in its aggregate debt levels (consumer, corporate and goverments), as well as in its trade surplus or deficit. Aggregate debt is currently over 300% of GDP and the US trade deficit is larger than most nations GDP. Treasuries of the world (China has $500B, Japan has more) hold huge dollar based positions to buy oil. If oil were to be priced in Euros, or anything other than US dollars, those US dollars come flooding back into the US treasury. The US will then have to buy that countries currency to pay them back. The US money supply has added more than $8 trillion dollars since 1971 - this will swamp us. This oil-dollar nexus is the US energy policy, if not the US economic and military policy. If we have to use another countries currency to buy oil not only is our era of military dominance over, but it will provide a painful end to our economic dominance. ' Posted by: John Dewey on May 7, 2004 'Dewey & daCascadian: Krugman wrote a post on his website about the theory that the war against Iraq was planned because OPEC wanted to change dollars for euros, refuting it quite convincingly IMO. The idea that the US need to dominate the ME and its energy resources because 'the Chinese and other Asian economies are consuming more of a soon-to-be dwindling resource' (asdf) is quite old, by the way. In 1949 State Department strategist George Kennan said that control over Japan's oil supply would give 'veto power' over their industries and military programs.' Posted by: Motoko Kusanagi on May 7, 2004 'Maybe I'm getting too old but I sure remember the same argument that the world was running out of oil and other natural resources back in the 1970s... Krugman addresses this in his column.' Posted by: Motoko Kusanagi on May 7, 2004 'Motoko wrote: Krugman wrote a post on his website about the theory that the war against Iraq was planned because OPEC wanted to change dollars for euros, refuting it quite convincingly IMO. I like Krugman a lot but he refutes himself in this piece where he writes: The US advantage comes to the extent - and only to the extent - that the international role of the dollar lets us borrow money more cheaply than we otherwise could. One component of that is clear: because foreigners hold a lot of dollar bills, which pay no interest, we in effect get a free loan of that much money. Imagine if we stopped getting 'free loan(s)' and had to start paying them back? Couple that with this line and quote from a Russian publication last Fall: If a Russian move to the euro were to prompt other oil producers to do the same, it could be a 'catastrophe' for the United States, Youssef Ibrahim, managing director of the Strategic Energy Investment Group in Dubai and a member of the U.S. Council on Foreign Relations said. 'There are already a number of countries within OPEC that would prefer to trade in euros.' Moscow Times http://www.axisoflogic.com/cgi-bin/exec/view.cgi?archive=29&num=2228&printer=1 Add that to our banking ties to Britain - check out the lineage between the Federal Reserve and the Bank of England - it becomes more difficult to think that control of the international monetary system is NOT a central issue motivating the 'war president', or you can buy Krugman's reason of: 'just because'.....NFW.' Posted by: John Dewey on May 7, 2004 'Motoko, one last piece to consider: The OPEC nations raised their oil prices 400% after the Yom Kippur War to compensate for the new weakness of the reserve currency, the US dollar. The media chronicled this as an oil price shock or oil crisis, a rapacious power play by OPEC ? few Americans to this day understand their own governments? role in the OPEC price hike of 1973. Michael Hudson, former economist at Chase Manhattan Bank and now a distinguished Professor of Economics at the University of Missouri at Kansas City saw it differently: When Saudi Arabia and Iran proposed to use their oil dollars to buy American companies after 1972, U.S. officials let it be known that this would be viewed as an act of war. OPEC was told that it could raise oil prices all it wanted, as long as it used the proceeds to buy U.S. Government bonds or small minority positions in U.S. companies via the stock market, creating a nice boomlet for U.S. investors to ride. This enabled Americans to pay for oil in their own currency, not in gold or other 'money of the world.' Oil exports to the United States, as well as German and Japanese autos and sales by other countries, were bought with paper dollars that could be created ad infinitim. The act of war admonition or threat came from the Nixon administration. Hudson, Michael (2003) Super Imperialism: The Origin and Fundamentals of U.S. World Dominance London: Pluto Press We will eventually come to understand that oil priced at $40 or even $45 per barrel is what the Federal Reserve actually WANTS (they will never admit to it however). The reason being that the higher the price of oil the greater the demand for US dollars outside the US (as long as oil is priced in dollars) and the US debt orgy (inside the US) can continue unabated.....unless Americans stop borrowing....and that day will come. It is a race to see who fliches first in a equation that has foreigners gulping up our debt as an investment vehicle or Americans somehow believing that debt is wealth. ' Posted by: John Dewey on May 7, 2004 'The nexus between the US Dollar and oil should eliminate any mystery as to why the US works to abolish any initiative that either increases conservation (The Kyoto Protocol), the use of alternative fuels and staunch resistance to the nationalizing of any countries oil supplies (Iran, Iraq, Russia, and Venezuela). The most persuasive argument holds that this unique relationship between oil and the US Dollar makes every barrel of oil an American asset, and therefore it makes perfect economic sense for the US to encourage MORE oil consumption and even create GREATER dependence in other countries of regions of the world.' Posted by: John Dewey on May 7, 2004 'Dewey: thanks for your posts, especially the Michael Hudson bit. I will have to think this over.' Posted by: Motoko Kusanagi on May 7, 2004

Subject: Re: Still Oil for dollars? From: Pete Weis To: El Gringo Date Posted: Mon, May 10, 2004 at 19:57:33 (EDT) Email Address: Not Provided Message: El Gringo. You've introduced a very important issue. This is an interesting view of a relationship between the trading of oil in dollars and its contributing influence on aggregate US debt. It's pretty obvious, any substantial move by oil producers to accept anything other than US dollars for their oil would signal the end of the dollar as the world's reserve currency. With the massive amounts of dollars held in reserve by central banks around the world, any huge move to offload those dollars (which would happen if OPEC wanted euros for their oil) would bring about a collapse in the dollar and hyperinflation in the US. Clearly this is a very precarious situation. I believe it comes down to how much faith OPEC and the rest of the world has in the US economy, US consumer, and the US dollar. Any slippage of confidence in these three entities - which are inter-related - and then who knows? By the way, the prediction of a drop in oil production, begining in 1970, was for the US only and not the entire world. The prediction was made in the late 50's by a US geologist by the name of Hubbert. At the time the US produced more than half of the world's oil, so any drop in US oil production would have and did have a great influence on oil prices after 1970. A number of articles written after 2000 discussed the 'Hubbert Curve' relative to world oil production in our present time. Some stated world oil production would peak around 2005 and decline from that point onward. Other articles were less specific, predicting peak production to occur in the 2005 to 2010 period. At present consumption levels, it was predicted the world would run out of its oil reserves (even the reserves yet to be tapped) within 40 years. If consumption increases due to increased demand by growing economies like China and India, then we have less time to find an alternative. Recent articles in the New York Times discussed production problems in the largest Saudi oil fields as well as some neighboring oil producers. Of course, steeply rising oil prices will reduce consumption so it's impossible to predict when the last drop will be drawn from the last oil well. We only know that this is an extremely serious problem for a world who's energy dependency is based on oil. Getting back to the issue in your post - we've gotten very used to having it our way so long with regard to our currency, it has created an allusion of invincibility. But nothing here on earth remains invicible forever.

Subject: Re: Still Oil for dollars? From: The Dude To: Pete Weis Date Posted: Mon, May 10, 2004 at 20:16:52 (EDT) Email Address: nma@hotmail.com Message: 'I believe it comes down to how much faith OPEC and the rest of the world has in the US economy, US consumer, and the US dollar. Any slippage of confidence in these three entities - which are inter-related - and then who knows?' Dear Pete, You are wise, terribly wise!

Subject: Econ Textbok delayed From: Hiroo yamagata To: All Date Posted: Fri, May 07, 2004 at 08:01:27 (EDT) Email Address: hiyori13@alum.mit.edu Message: It seems that Krugman&Wells textbook has been delayed significantly. It was supposed to be Dec. 2003, slided into March 2004, but now, it's Autumun 2005. 2005? That's a typo, right? He means 2004, no? Wow, did he decide to redo the whole thing at the last minute? I had the impression that the whole thing was virtually done! www.worthpublishers.com/krugmanwellsnew/

Subject: War on terrorism From: Bobby To: All Date Posted: Fri, May 07, 2004 at 00:05:52 (EDT) Email Address: robert@pkarchive.org Message: I posted this on Atrios earlier, and I wanted to repost it here since I spent a little while on it and hoped for further mileage from it. Its points are I think fairly obvious, but I think our public discussion of what a war on terror involves has been very unfocused, and the administration's public statements about our fundamental strategy in it are ad hoc and muddled. Anyway, here you go: The war on terror is not a war like WWII or Vietnam. If it is a war, it is one in the sense that the Cold War was a war (this analogy is helpful since the claim that dissent 'helps the enemy' has far less credibility in a Cold War-like war, as opposed to a WWII-like war). In the long run, in order to beat Islamist terrorism, we have to win over the hearts and minds of people in the Muslim world, and we're going in the exact opposite direction now. 'Taking the fight to the enemy,' which is more of a slogan than a thought out strategy can't be our only line of defense as it is with Bush. It definitely should not be carried out in the fashion Bush has done, which creates terrorists and support for them faster than we can kill them. We need in general at least three lines of defense, almost all of which are being ignored. Foremost we need a program at home to detect and prevent attacks on large populations within our country, especially in urban centers like NYC. This should be our last line of defense. In general, this would involve taking our scarce resources out of Iraq for now and put them into port security, repurchase of nuclear fuels overseas (including not only former Soviet republics but also India and Pakistan and maybe Iran), new technologies to detect chemical and nuclear weapons, and metal detectors in crowded areas, chemical detectors, and other securty measures to defend us at home, especially in our cities, and especially New York. Then our second to last line of defense should be port and border security (for WMD and terrorist-detecting purposes, not anti-immigration ones). Our first line of defense should involve espionage, cooperation, cooption, and infiltration of foreign intelligence, and covert operations in foreign countries to detect terrorist, plots, and WMDs that can be used against us. This requires cooperation with Muslim countries, which includes the public support from their general populations for our actions. This is made far more difficult if the populations of these countries hate us because of unnecessary things that offend them like our Iraq venture. This first line of defense is really the only sense in which we should be 'taking the fight to the enemy,' whereas occupation, like in Iraq, is an extreme measure for extraordinary circumstances. Iraq really does not apply to this though Afghanistan was necessary. Ironically, this first line of defense will likely take the longest to create, and it is made longer by our current occupation of Iraq. Port security and protection of concentrated populations is difficult, but at least something acceptable can be put in more quickly if we spend more money. Improvements in such a system can begin sooner if we make this system more quickly. Sadly Bush is wasting our resources on Iraq and highly regressive tax cuts. By pissing off the Middle East right now he is making an attack here at home more likely, and they have far more adherents willing to participate in it due to our actions in Iraq. But compared to what we need, we have very little in place to defend us due to Bush's neglect. http://www.pkarchive.org www.pkarchive.org

Subject: Re: War on terrorism From: hume an To: Bobby Date Posted: Fri, May 07, 2004 at 11:34:07 (EDT) Email Address: hume_an@yahoo.com Message: Bobby: I totally agree with you that we need to work on the hearts and minds of the people of the Muslim world. I also believe the measures you propose at home are excellent because they are targeted and address the U.S.'s vulnerabilities, and as such, have the ancillary benefit of being cost-effective. I think a couple of concrete action the U.S. could do to win hearts and minds include: Firing Don Rumsfield - the U.S. promised to usher in liberation and humanity into Iraq. The pictures of U.S. soldiers torturing Iraqi prisoners completely undermine that promise. Firing Donald Rumsfield, the embodiment of the U.S. military, would send a signal that such egregious violations of human rights will not be tolerated. Speed up the rebuilding of Iraq. I think moderates are being converted into radicals because the streets in Iraq are still dangerous and flooded with sewage. The people of Iraq hear American promises of a better life, but they haven't seen the evidence. Long-term action - significant ramping up of foreign aid to developing countries. There aren't too many terrorists in wealthy, well-educated, secular countries. Desperation, more than anything else, leads to terrorism. How to snuff out terrorism? Work on removing the conditions that foster desperation.

Subject: Well Argued From: Jennifer To: hume an Date Posted: Fri, May 07, 2004 at 14:01:51 (EDT) Email Address: Not Provided Message: Thanks!

Subject: Re: Well Argued From: Tyler To: Jennifer Date Posted: Thurs, May 13, 2004 at 18:56:40 (EDT) Email Address: halltr@slu.edu Message: This is my favorite this week from Letters in the Economist (thought you might like it): 'SIR – You call for the resignation of Mr Rumsfeld yet suggest that the American electorate should pass judgment on Mr Bush. You called for Bill Clinton's resignation when the Lewinsky scandal broke. Why the sudden reverence for elections? Jonathan Aurthur Santa Monica, California'

Subject: Looking for a little Clarity From: Mik To: All Date Posted: Thurs, May 06, 2004 at 17:35:09 (EDT) Email Address: Not Provided Message: I have just read P Krugman's latest story and am very impressed. Krugman has just highlighted another major mess-up by the current administration. Now I'd like to ask if you guys can help me in summarising the key mistakes undertaken to date by the current administration related to Iraq: 1. The original reasoning to go into Iraq was linked ot WMD. 2. Failure to get UN backing 3. Not having enough troops on the ground to manage the peace straight after the invasion. 4. The first attempt to place puppets into power. 5. Now the privatisation of Iraq's oil supply and infrastructure to US companies, acting like an occupying ocuntry and not a liberator. Am I off the mark here?

Subject: Re: Looking for a little Clarity From: byron To: Mik Date Posted: Thurs, May 06, 2004 at 22:39:49 (EDT) Email Address: bconstl@juno.com Message: No, you are right on the mark. The whole purpose for this war was for oil. Cheney was dividing up Iraq's oil fields before the war began. Sadam couldn't hold a candle to The Bush Admin when it comes to lying and deception. They are masters of the art.

Subject: Re: Looking for a little Clarity From: La Gringa To: Mik Date Posted: Thurs, May 06, 2004 at 19:26:46 (EDT) Email Address: nma@hotmail.com Message: ...if you guys and gals...please

Subject: Does Information Technology Matter From: Emma To: All Date Posted: Thurs, May 06, 2004 at 14:32:50 (EDT) Email Address: Not Provided Message: http://www.nytimes.com/2004/05/06/business/06scene.html How Much Does Information Technology Matter? By HAL R. VARIAN IN May 2003, The Harvard Business Review published an article by a former editor, Nicholas G. Carr, titled 'IT Doesn't Matter.' The reaction from industry chief executives was immediate. 'Hogwash!' said Steven A. Ballmer of Microsoft. 'Dead wrong,' said Carleton S. Fiorina of Hewlett-Packard. Craig R. Barrett of Intel responded forcefully, 'IT matters a whole lot.' Now, a year later, Mr. Carr has replied to his critics with a new book, 'Does IT Matter?' (Harvard Business School Press). It's a good book. Mr. Carr lays out the simple truths of the economics of information technology in a lucid way, with cogent examples and clear analysis. His basic point is straightforward. At one time, information technology was so expensive and so difficult to manage that companies could make large amounts of money simply by being able to make systems work. (Think I.B.M.) Companies that lacked the skills to manage information technology effectively suffered compared with competitors that had mastered those skills. But over the years, as information technology has become cheaper and more manageable, this source of competitive advantage has been reduced and perhaps eliminated. Hiring knowledgeable employees is much easier than it used to be, and the tools to manage this technology are far more powerful than they were a few short years ago. Nowadays anybody can set up a Web server, or an accounting system, or an inventory management system. The ability to manage technology effectively is no longer the barrier to entry it once was. Hence, it no longer serves as a source of competitive advantage. So it is with every new technology. When electric motors became small enough to drive individual machine tools, it became possible to set up assembly lines and greatly improve productivity. Henry Ford and his colleagues created the assembly line and other techniques of mass production in the formative days of the automobile industry and enjoyed a significant advantage over their competitors for nearly 20 years. But by the end of the 1920's, all automobiles were made using the techniques Ford pioneered, and his competitive advantage disappeared. The playing field tipped toward General Motors, which had developed more flexible procedures that allowed it to offer frequent updates in model styles. Knowing how to run an assembly line no longer conferred a competitive advantage, because everyone knew how to do it. According to Mr. Carr, knowing how to use information technology is like knowing how to run an assembly line. It is a utility now, like telephone service or electricity. Asking whether information technology matters is like asking whether electricity matters. In one sense it certainly does - without electricity, commerce would grind to a halt. But skill in the management of electricity isn't particularly useful to most companies, since electricity is now so cheap and so commonplace that it can't really be a source of competitive advantage to anyone. Profit comes from scarcity. Companies that can provide products or services that others can't provide can charge premium prices. As more and more companies are able to supply something, competition works its magic and forces prices down. 'Complexity management' can still serve as a barrier to entry in some industries. Making integrated circuits is fiendishly complex, and Mr. Barrett of Intel is certainly right when he says information technology is critical in his industry. But as he would readily agree, it is not the whole story. A potential competitor could go out and buy the same technology that Intel uses and still fail miserably in trying to compete with it. Even Intel doesn't know quite why some chip manufacturing processes work better than others. In the late 1990's it instituted a program called 'Copy EXACTLY!,' which required that new plants use equipment and procedures replicated from existing plants, right down to the color of paint on the wall....

Subject: Re: Does Information Technology Matter From: Mik To: Emma Date Posted: Thurs, May 06, 2004 at 17:10:17 (EDT) Email Address: Not Provided Message: Emma, I have a question for you on this topic. Do you not think our IT technology has actually surpassed our real needs? In the company where I work, we basically use Excel and MS Word. But the functions we use in these software packages doesn't even reach the capacity that Word and Excel 95 could already offer. We are well passed Word and Excel 2000 in our software upgrades(I have no idea what we now use) but still we are not doing anything that we couldn't do say 10 years ago. Amazing - 10 years ago. I have always been irritated when we had to upgrade our software for no reason that I could see justified the cost. And we did this over and over again. Everytime we upgraded our software there would be one or other problem causing down time and some training. But once the system is up and running I would ask, now that we have spent all this money and undergone the down town time to get the the new software up and running; what can we now do that we could not do before? To date no one can answer that question, yet everyone around me continues to pursue bigger better hardware to run software that gives us no extra speed of office operation, no extra features to make life simpler and no features that allow us to be better at what we do. I have recently started a business (on the sideline). From the outset I was determined to have a 'high-tech' system that is totally paperless. I send and receive faxes on the computer, I do most of my work by e-mail. I operate in 3 different countries (over 9 time zones), send and receive all my invoices by e-mail and store everything on computer with, I'm glad to say, no paper, no printer... but get this I run this business with an old 486DX laptop computer and Windows 95 with Word and Excel 95.

Subject: Re: Does Information Technology Matter From: Jerry To: Mik Date Posted: Tues, May 11, 2004 at 10:30:46 (EDT) Email Address: Not Provided Message: One thing I can add...I work for a government archive and we are certainly pushing the IT envelope. We are handling so much data at such a high speed that we are years behind what we 'need' even with the latest and greatest technology. I think IT matters most in terms of scale.

Subject: Re: Does Information Technology Matter From: Mik To: Jerry Date Posted: Wed, May 12, 2004 at 17:54:11 (EDT) Email Address: Not Provided Message: point taken. thanks

Subject: Scarce Jobs IN India From: Emma To: All Date Posted: Thurs, May 06, 2004 at 13:58:05 (EDT) Email Address: Not Provided Message: http://www.nytimes.com/2004/05/06/international/asia/06indi.html?hp Low-Tech or High, Jobs Are Scarce in India's Boom By AMY WALDMAN HYDERABAD, India - Two years ago, with the employment market in his drought-stricken rural district as dry as the earth, Bhaliya made his way to this high-tech capital in southern India and found salvation in a low-tech straw broom. He became a city street sweeper, earning 1,800 rupees a month, or roughly $40. The pay was so low, and his 1,000 rupee-rent for one room in this inflationary city so high, that his wife became a sweeper too, leaving three toddlers in neighbors' care. Each day since, they have bent to clear errant flotsam from the curbs, and straightened to see the immaculate imagery of the new India: hundreds of billboards advertising cars, mobile phones and Louis Phillipe shirts. The temptations are forever out of reach, yet Mr. Bhaliya, 25, counts himself lucky. 'We have to work to live,' he said, knowing better than to ask for more. India's economy is spawning a growing middle class, a host of world-class companies, a booming stock market and a new image for this nation of more than one billion people. But those very reforms and conditions are also reducing the prospects of some of its citizens. India may be 'shining,' in the description of a controversial and expensive government publicity campaign, but it is also struggling to generate jobs. That employment problem could prove to be the Achilles' heel of the ruling National Democratic Alliance, led by the Bharatiya Janata Party, which is seeking re-election on the strength of an economy that grew at a breathless 10.4 percent in the first quarter of this year. Three weeks of voting in this vast country conclude on May 10. The public sector, once a stalwart of security, has lost some 4.5 million jobs in the past six years. In this state, Andhra Pradesh, government recruitment has been frozen, and the government has cottoned to private sector practicalities. Street sweeping, once a government job that paid triple what it does now and came with medical care, a pension, annual leave and job security, has been outsourced to private contractors, who offer none of that. The streets of Hyderabad have never been cleaner, the city's budget never leaner, and for workers, the insecurity and indigence never greater. On a Friday afternoon, Mr. Bhaliya, who uses only one name, was working two hours past his shift's end - for no overtime pay - to ensure the chief minister a dustfree view when he drove past. With greater efficiencies, global competition, cheap capital and new technology, private companies are doing more with fewer employees....

Subject: re.jobs in stock market in hyderabad From: s.vasundhara To: Emma Date Posted: Wed, May 19, 2004 at 06:58:14 (EDT) Email Address: ammuchinnu2004@yahoo.com Message: http://www.nytimes.com/2004/05/06/international/asia/06indi.html?hp Low-Tech or High, Jobs Are Scarce in India's Boom By AMY WALDMAN HYDERABAD, India - Two years ago, with the employment market in his drought-stricken rural district as dry as the earth, Bhaliya made his way to this high-tech capital in southern India and found salvation in a low-tech straw broom. He became a city street sweeper, earning 1,800 rupees a month, or roughly $40. The pay was so low, and his 1,000 rupee-rent for one room in this inflationary city so high, that his wife became a sweeper too, leaving three toddlers in neighbors' care. Each day since, they have bent to clear errant flotsam from the curbs, and straightened to see the immaculate imagery of the new India: hundreds of billboards advertising cars, mobile phones and Louis Phillipe shirts. The temptations are forever out of reach, yet Mr. Bhaliya, 25, counts himself lucky. 'We have to work to live,' he said, knowing better than to ask for more. India's economy is spawning a growing middle class, a host of world-class companies, a booming stock market and a new image for this nation of more than one billion people. But those very reforms and conditions are also reducing the prospects of some of its citizens. India may be 'shining,' in the description of a controversial and expensive government publicity campaign, but it is also struggling to generate jobs. That employment problem could prove to be the Achilles' heel of the ruling National Democratic Alliance, led by the Bharatiya Janata Party, which is seeking re-election on the strength of an economy that grew at a breathless 10.4 percent in the first quarter of this year. Three weeks of voting in this vast country conclude on May 10. The public sector, once a stalwart of security, has lost some 4.5 million jobs in the past six years. In this state, Andhra Pradesh, government recruitment has been frozen, and the government has cottoned to private sector practicalities. Street sweeping, once a government job that paid triple what it does now and came with medical care, a pension, annual leave and job security, has been outsourced to private contractors, who offer none of that. The streets of Hyderabad have never been cleaner, the city's budget never leaner, and for workers, the insecurity and indigence never greater. On a Friday afternoon, Mr. Bhaliya, who uses only one name, was working two hours past his shift's end - for no overtime pay - to ensure the chief minister a dustfree view when he drove past. With greater efficiencies, global competition, cheap capital and new technology, private companies are doing more with fewer employees.... ---

Subject: Luskin Ultra Bullish From: Kosh To: All Date Posted: Thurs, May 06, 2004 at 12:12:56 (EDT) Email Address: jrgallag@earthlink.net Message: Well, the long-dreaded meeting of the Federal Open Market Committee meeting has come and gone. For months the Fed had pledged to keep rates low for a 'considerable period.' Then that was softened to being 'patient.' And now there's a new word -- rates will be raised at a 'measured' pace. For the bond market, these words all amount to the same awful thing. They are all polite synonyms for 'inevitable.' That's right -- it is strictly inevitable that the Fed will raise rates and burst the bond bubble. But for stocks, this is an opportunity. Since the equity market top in 2000, bonds have outperformed stocks spectacularly. Now it's time for all that to reverse. Rising rates will clock bonds, which have been unnaturally supported by unnaturally low rates. But the economy and corporate earnings are surging -- and rate hikes at a 'measured' pace aren't going to put the least dent in that. What they're going to do instead is start to rein in incipient inflation. Put it all together, and it's going to be a perfectly fine time to be long stocks. That's why I've been adding to my portfolio's position in the Rydex Velocity 100 Fund (RYVYX) -- the mutual fund that uses leverage to deliver twice the return of the Nasdaq 100 Index. I've gotten lots of e-mails from readers and several messages on the Strategy Lab discussion boards warning me not to take that kind of risk. But I don't see it as all that risky. I've seen the decline of the last couple weeks as a classic 'buyable dip.' And even with all the Rydex Velocity 100 Fund buys, my portfolio is still effectively less than 100% exposed to the stock market. Frankly, I'm more worried about missing out on the upside than I am about the downside. http://moneycentral.msn.com/content/Stratlabs/Round10/P82865.asp

Subject: Re: Luskin Ultra Bullish From: Pete Weis To: Kosh Date Posted: Thurs, May 06, 2004 at 20:27:50 (EDT) Email Address: Not Provided Message: If he's really doing what he says he's doing, he is sacrificing himself on the alter of stupidity. Suppose those who have had a major dislike of Mr. Luskin will probably get to relish his coming financial difficulties. He's definitely the 'greater fool' Mik was talking about in an earlier post. He and his followers (if they follow his advice) are just the ticket for those insiders still looking to offload.

Subject: Re: Luskin Ultra Bullish From: Kosh To: Pete Weis Date Posted: Fri, May 07, 2004 at 10:28:27 (EDT) Email Address: jrgallag@earthlink.net Message:

Subject: Stocks and Bonds From: Terri To: Kosh Date Posted: Thurs, May 06, 2004 at 15:50:03 (EDT) Email Address: Not Provided Message: So the question is whether rising rates will still allow earnings to grow fast enough to generate stock gains or at least allow the market to trade in place.....

Subject: Poor Health Care! From: Emma To: All Date Posted: Wed, May 05, 2004 at 15:14:13 (EDT) Email Address: Not Provided Message: http://www.nytimes.com/2004/05/05/health/05CARE.html Study Finds Widespread Problem of Inadequate Health Care By LAWRENCE K. ALTMAN Americans get substandard care for their ailments about half the time, even if they live near a major teaching hospital, the first comprehensive study of health care provided in metropolitan areas has found. The inadequate treatment leads to 'thousands of needless deaths each year,' said Dr. Elizabeth A. McGlynn, a researcher at the RAND Corporation and an author of the study, being published today in the journal Health Affairs. Only a fundamental redesign of the health system will improve the situation, Dr. McGlynn said, adding, 'It's a tremendous cultural shift we're asking for.' The study's conclusions were based chiefly on a review of the medical records of nearly 7,000 people in 12 metropolitan areas, including Newark, Miami and Orange County, Calif. On average, the authors found, patients received substandard care, as defined by leading medical groups, 50 percent to 60 percent of the time. There was little variation among the metropolitan areas, randomly selected from 60 with populations of at least 200,000. The areas included cities and their suburbs. Dr. McGlynn said the study's definitions of adequate care were developed not only from the recommendations published by specialty medical groups but also from four panels of doctors who practiced in a variety of settings. The recommendations reflected what was considered standard at the time the care in the study was delivered, from 1996 to 2000. The team used the standards to measure average care for adults in an entire community, not the care delivered by specific hospitals, health care plans or doctors. The study did not make comparisons with earlier years or other countries. 'Quality in most areas of care was uniformly poor,' said the authors of the study, which was financed by the Robert Wood Johnson Foundation. And Dr. McGlynn added that for the $1.4 trillion a year the United States spends on health care, it was getting 'fairly dismal results.' In a telephone interview with reporters, she noted that doctors and hospitals were paid the same whether they provided 'very good care or not-so-good care.' ...

Subject: No Medical Insurance From: Emma To: Emma Date Posted: Wed, May 05, 2004 at 15:15:42 (EDT) Email Address: Not Provided Message: http://www.nytimes.com/2004/05/05/national/05HEAL.html Texas Leads Nation in Percentage of Uninsured Workers By ROBIN TONER WASHINGTON — Texas leads the nation in the percentage of working people who have no health insurance, but the lack of coverage is a pervasive problem for workers in nearly every state, according to a new study for the Robert Wood Johnson Foundation. The study also found that being uninsured has clear health consequences. People without coverage were less likely to get basic preventive care, like mammograms; less likely to have a personal physician; and more likely to rate their own health as only poor or fair. Analysts said the study highlighted deep problems in a health care system that still assumes most people will get their coverage through their employers. The shift of many workers from manufacturing to lower-paid service-sector jobs, and from bigger employers to smaller businesses, means this assumption is increasingly out of date, these analysts said. Many small businesses simply cannot afford to provide their workers with health insurance, which is now approaching an average cost of $9,000 a year for each employee, according to Kate Sullivan, director of health care policy at the United States Chamber of Commerce. The study found that Texas, where 27 percent of working adults were uninsured, had the highest rate among the six states where at least one in five workers lacked coverage. The others were Louisiana, 23 percent; Mississippi and New Mexico, 22 percent each; and Oklahoma and Nevada, 21 percent each. States with the lowest uninsured rates among workers were Minnesota and Hawaii, 7 percent each; Maryland, 8 percent; and Iowa, 9 percent. Officials in Texas said that the higher rate in their state probably reflected its labor force — more likely to work for small businesses, less likely to be unionized. They also said that the state was working on the problem. The new study was sponsored by a broad nonpartisan coalition of labor, consumer and business groups, including the chamber, as part of 'Cover the Uninsured Week,' a nationwide series of events to be held May 10 through 16 to draw attention to the issue....

Subject: Re: No Medical Insurance From: Nat To: Emma Date Posted: Fri, May 07, 2004 at 13:04:30 (EDT) Email Address: Not Provided Message: Yeah, they're working on it here in Texas. And it will be fixed when monkeys fly out of all our butts. These figures, although disturbing, are never presented in the proper context. If you are working poor, the percentage is very much greater than 27%. If your wage is calculated by the hour the odds are very high that you do not have health insurance. And the figures never take into account undocumented workers who never, ever have insurance since they are outside that world. And Texas has a few of those, I hear. And, as for our so-called safety net: you can get Medicaid if you are a poor pregnant woman or eligible for SSI (i.e. you are an aged or disabled citizen with low income.) Only about 88k adults get TANF (and hence Medicaid) in Texas: for a parent or caretaker to be eligible for TANF in Texas the family income has to be low enough to meet Texas's recognizeable needs limit of $188 a month for a family of 3. The Medically Needy spend down program for adults was cut last year in the budget debacle. The MN limit for a family of 3 is $206 for coverage. Both TANF and MN have a $2000 limit on assets. So, the working poor are not only unlikely to have insurance, the so-called safety net barely exists for adults in Texas at the state level. The real medical safety net for those without insurance are public sector hospitals. These might be a county, city or hospital district entity, but each of these is ultimately supported by local tax payers. When national and state politicos say they are working on the problem, that really means they are trying to figure out how to pass it on to someone else.

Subject: A look at the likely replacements for Greenspan From: El Gringo To: All Date Posted: Tues, May 04, 2004 at 20:09:15 (EDT) Email Address: nma@hotmail.com Message: 'Robert Rubin, 63. Widely respected for his confident handling of crises as economic adviser and Treasury secretary in the Clinton administration, Rubin, now chairman of the executive committee at Citigroup, is often mentioned as a Greenspan successor. Rubin did postgraduate work in economics but has no Ph.D. ? not much of a drawback, given his practical market experience. A bigger obstacle is that he's a Democrat, which keeps him off the A-list in a Bush administration. But the most important reason Rubin will probably never be Fed chairman is that he doesn't seem to want the post. Friends say he has made little secret of his lack of interest in what he describes as a somewhat mechanistic and excruciatingly detailed job.' My opinion is:http://www.pkarchive.org/column/8600.html

Subject: What if? From: Pete Weis To: El Gringo Date Posted: Wed, May 05, 2004 at 20:05:13 (EDT) Email Address: Not Provided Message: El Gringo, here's a 'what if'. Suppose Greenspan retires before November. Who would Bush nominate? Bernanke?

Subject: Shades of PK From: emma To: Pete Weis Date Posted: Thurs, May 06, 2004 at 13:52:04 (EDT) Email Address: Not Provided Message: The guess is a Republican banker or economist for Fed Chief, but I do not expect Greenspan to leave soon. .... Greenspan Says Soaring Budget Deficits Are Long-Term Threat By AP America's soaring federal budget deficits represent a major obstacle to the country's long-term economic stability, the Federal Reserve chairman warned today.

Subject: Re: Shades of PK From: Pete Weis To: emma Date Posted: Thurs, May 06, 2004 at 20:04:03 (EDT) Email Address: Not Provided Message: I believe Greenspan's term runs out this June and he would need to be reappointed? Right now the upcoming elections look close and Iraq is not going well. After the President, the Fed Chairman job comes with the most power. Some might argue, since the Chairman's term is so much longer and he has the greatest power over the economy of any individual, that his job, in some ways, is more important. You have to wonder whether those who surround Bush, as well as his wealthiest supporters, would want to risk having the Democrats pick the next Fed Chairman. However, stirring things up by replacing Greenspan might be risky for the markets. Yet, if the markets have already begun to tank in earnest by the middle of June, then we might see the Republicans make their move. Maybe I'm way off base here, but I wouldn't be surprised to see Greenspan announce his retirement and a new Fed Chairman nominated this summer. Of course this is just speculation, but there are some clues to suggest Greenspan's replacement will be Bernanke.

Subject: Re: Shades of PK From: El Gringo To: Pete Weis Date Posted: Thurs, May 06, 2004 at 20:34:44 (EDT) Email Address: nma@hotmail.com Message: 'After the President, the Fed Chairman job comes with the most power.', are you sure?,2nd, '...then we might see the Republicans make their move.' Move or deal?

Subject: Re: Shades of PK From: Pete Weis To: El Gringo Date Posted: Fri, May 07, 2004 at 20:11:55 (EDT) Email Address: Not Provided Message: Some have suggested this administration would want to make a 'deal' with Greenspan to leave the Fed rate where it is until after the election in return for his reappointment. But how confident are Bush's financial backers that he will prevail in November? Bush will do what he's instructed to do. The new Fed Chairman, whether he's put in place in 2004 or in a couple of years down the road (Greenspan is getting up there in age)will obviously wield a lot of power with regard to future economic policy. If you look at the massive redistribution of wealth, upward, during the last twenty years which has been greatly enhanced by the easy monetary policies of our present Fed Chairman, you can see the importance those on the receiving end of this good fortune would put on the selection of our next Chairman. Greenspan may not be so anxious to stick around and the end of his present term gives him an excuse to step down. IMO there is some serious economic pain ahead and Greenspan knows it. He's managed to hold off the inevitable by reducing rates to a greater extent than ever in history, but that is now at an end. He showed desparation in his recent appearance before Congress when he suggested home buyers and owners get into ARM's when he knew rates were headed upward. I'm not sure Greenspan wants to stick around for the big 'squeeze' - caught between rising inflation, rising interest rates, rising oil prices and falling consumption due to the reverse wealth affect of falling stock and real estate markets. He's got much of the responsibility for the box he finds himself in - maybe the only way he gets out is to retire. Unfortunately the rest of us are left with the mess.

Subject: Re: Shades of PK From: emma To: emma Date Posted: Thurs, May 06, 2004 at 14:34:11 (EDT) Email Address: Not Provided Message: Suddenly Alan Greenspan is warning about deficits, but that was PK these last 3 years....

Subject: Brazil and Soybeans From: Emma To: All Date Posted: Tues, May 04, 2004 at 16:27:11 (EDT) Email Address: Not Provided Message: http://www.nytimes.com/2004/05/04/business/worldbusiness/04pedro.html Brazil's Road to Victory Over U.S. Cotton By ELIZABETH BECKER and TODD BENSON It began with Brazil's soybean farmers. Pedro de Camargo Neto, then a top official of the Brazilian Rural Society, Brazil's most influential agriculture lobby, kept hearing complaints in the late 1990's from farmers that, just as they were starting to turn a profit with their soybean exports, they were getting clobbered by lower-priced American soybeans that were heavily subsidized with taxpayers' money. 'Something was wrong here,'' he said in a telephone interview. 'I didn't understand how this could be happening.'' After looking closely at the subsidies for the richest American agribusinesses and their impact on Brazilian farmers, Mr. Camargo - who was Brazil's deputy agriculture minister at the time - began a campaign in 2001 to sue the United States at the World Trade Organization. Last week, the W.T.O. finally issued a preliminary ruling favoring Brazil and two African nations over the United States in the first case brought against a developed nation's domestic subsidies. The ruling concerned cotton, not soybeans, and Mr. Camargo is no longer in government, but he could not be more thrilled with the outcome. It was not an easy battle for Mr. Camargo, who faced political obstacles at almost every turn. A cattle rancher with a master's degree in engineering from the Massachusetts Institute of Technology, Mr. Camargo thought he had understood the logic of globalization and liberalized trade. He had been an adviser for Brazil during global trade negotiations in the Uruguay round. The premise was that developing countries like Brazil could better lift their farmers out of poverty through trade, and not aid. 'This is really a pioneering case,'' Mr. Camargo said after hearing about the preliminary outcome. 'I wish this would have happened while I was still in the government. It's nice to be recognized.'' The W.T.O. ruled that the multibillion-dollar subsidies to the biggest American cotton farmers and agribusinesses amounted to unfair trading practices. It could mean a breakthrough in a decade-long fight by the world's developing nations to force rich countries to end their $300 billion in subsidies and supports to the biggest farmers....

Subject: Debt and Interest Rates From: Emma To: All Date Posted: Tues, May 04, 2004 at 14:29:12 (EDT) Email Address: Not Provided Message: http://www.nytimes.com/2004/05/04/business/04debt.html As Household Debt Rises, New Risk in Higher Rates By EDMUND L. ANDREWS WASHINGTON - Philo Thompson is 28, single and - like many other Americans these days - not afraid to stretch when it comes to buying a house. A management consultant in Denver, Mr. Thompson bought a $500,000 townhouse last Friday in the suburb of North Cherry Creek. As many other first-time homeowners have done, Mr. Thompson put no money down. Instead, he took out a first mortgage for 80 percent of the purchase price and paid the rest by taking a home equity loan against the new house. To reduce his monthly payments, and to qualify for a big enough loan, he took out an adjustable rate mortgage that requires him to make only interest payments. People like Mr. Thompson could get squeezed if interest rates start to rise. With economic growth looking strong and hints of inflation in the air, Federal Reserve officials have made it clear that the era of extraordinarily cheap money is slowly drawing to a close. Yet Mr. Thompson betrays no worries. 'I'm too young to be scared,' he said last week, betting that both the value of the house and his income will keep rising. If the bet fails, he said, it will not be the end of the world, adding: 'There is a difference between being poor and being broke. Being broke is more of a temporary condition. Donald Trump has been broke a couple of times.' Mr. Thompson is not alone in such thinking. After a three-year period when the Federal Reserve cut interest rates to their lowest level since 1958, Americans have become far more willing to load up on debt and banks have become far more willing to let them. Household debt climbed at twice the pace of household income from the beginning of 2000 through 2003, according to data at the Federal Reserve. Enticed by low interest rates, Americans took on $2.3 trillion in new mortgage debt during that period - an increase of nearly 50 percent. Consumer credit, from zero-interest auto loans to the much more expensive debt on credit cards, climbed 33 percent, rising to $2 trillion in 2003 from $1.5 trillion in 2000. Alan Greenspan, the Federal Reserve chairman, has repeatedly argued in recent months that rising household debt poses few problems. Fed officials note that the financial position of American households is, in some respects, stronger than ever. The value of household assets - from resale prices of homes to the size of stock portfolios - has increased even faster than debt. Indeed, the collective net worth of American households is now higher than it was before the stock market bubble burst four years ago. And thanks in part to lower interest rates, monthly debt payments consume a smaller share of monthly income today than in late 2001....

Subject: Chinese Grain Production From: Emma To: All Date Posted: Mon, May 03, 2004 at 14:06:56 (EDT) Email Address: Not Provided Message: http://www.nytimes.com/2004/05/02/international/asia/02farm.html China Races to Reverse Falling Grain Production By JIM YARDLEY TANCETUN, China - This spring, as China's top leaders - alarmed by declining grain production - have exhorted farmers to plant more rice, wheat and corn, Meng Qingchang has tended his small field of ankle-high wheat, knowing he cannot possibly answer the government's call. How can he plant more with less land? He pointed with disgust on a recent day to a golf resort built for China's nouveaux riches over former wheat fields. It is part of a startling land grab in a nation where much of the terrain is unsuitable for agriculture. Since 2002, China has lost more than 13,500 square miles of farmland. Last year alone, more than 2 percent of all farmland was lost. 'If development continues like this, we will not be able to produce enough grain to feed the Chinese,' said Mr. Meng as he sprayed pesticide on his small remaining field. 'How can you feed so many people with less and less land?' The rapid urbanization of China is eating up the land of millions of farmers. Millions more have stopped growing grain because it is not profitable. The resulting shift in the Chinese countryside has left government leaders worried about China's ability to feed itself and prompted an emergency campaign to curb land losses and increase grain output. In an era of global trade, many economists find the political fixation on grain outdated. But it underscores the historic resonance of food security in China, where 30 million people died in the famines of the Great Leap Forward and where 1.3 billion people must be fed with only 7 percent of the world's arable land. 'The government is concerned that if the major grain-producing areas do not grow grains anymore, how much can China produce?' said Cheng Guoqiang, an agriculture expert at a leading government research institute. 'The government wants to stop the decline of grain production.' For years, Chinese policy has had a goal of 95 percent self-sufficiency for rice, wheat and corn. In the past decade, China has seen cycles of oversupply and decline, and no one considers the current problem to be a food crisis. But government leaders clearly see this year's harvest as critical in reversing China's declining production and proving that the nation can feed its growing population. China's production of rice, corn and wheat dropped to about 401 million tons in 2003, down 18 percent from the record 486 million tons in 1998, according to United States Department of Agriculture statistics. In that record year, China had a glut of grain and was a net exporter. Last year, China consumed 40 million more tons of grain than it produced. At the same time, China has been increasing its imports and tapping into grain reserves. It is already the leading buyer of American soybeans. This year, for the first time in five years, China will import wheat. The political ramifications clearly worry China's nondemocratic leadership, even if many economists say imports are logical in a global economy. 'This isn't only an economic issue,' said Robert Ash, a University of London economics professor with a specialty in Chinese agriculture. 'China in a general sense doesn't want to be dependent for such a fundamental good. But, really, China doesn't want to be dependent on the United States.' ...

Subject: Chinese Limits to Freedom From: Emma To: Emma Date Posted: Mon, May 03, 2004 at 15:53:10 (EDT) Email Address: Not Provided Message: http://www.nytimes.com/2004/05/03/international/asia/03chin.html Let Freedom Ring? Not So Fast. China's Still China. By JOSEPH KAHN BEIJING - During the Cultural Revolution, China's propaganda department often made hyperbolic charges against intellectuals - capitalist roaders, enemies of the people - accused of betraying Mao Zedong. So when Jiao Guobiao, a journalism professor at Beijing University, was searching for words to describe China's still all-powerful censors and standard-setters more than 30 years later, he borrowed from its lexicon of vitriol. The department is spiteful like the Nazis, he wrote in a recent essay. It thinks itself infallible like the pope. In the 1950's it covered up the starvation of millions of people. Today, he charged, it lies about SARS. 'Their censorship orders are totally groundless, absolutely arbitrary, at odds with the basic standards of civilization, and as counter to scientific common sense as witches and wizardry,' he wrote in the article - which has been widely circulated by Internet in Beijing despite, not unpredictably, being banned by the Communist Party's propaganda department. Such explicit outbursts of dissent are still rare in China. But Mr. Jiao is not alone in expressing frustration that, even after a long-awaited transition to a new generation of leaders some 18 months ago, China's political scene remains stultifying. Intellectuals, Mr. Jiao said, are 'supposed to act like children who never talk back to their parents.' The leadership team headed by the president and party chief Hu Jintao that many hoped would tolerate more open debate has instead slapped new restrictions on free speech and the press that some say remind them of the repressive years after the 1989 Tiananmen Square crackdown. State security agents have been scouring the Internet and pressing charges against people who use it to distribute information or express opinions deemed unfavorable. The authorities harassed scholars who took part in a debate about constitutional changes, disappointing some who believed that Mr. Hu had once invited discussion about how to strengthen the rule of law. Last month, Beijing decided against allowing universal suffrage in Hong Kong, even though many in the former British colony felt they were promised that right when China assumed sovereignty in 1997. The political environment may reflect a seasonal shift to tight controls during the spring Communist Party meetings and a state of high alert ahead of the 15th anniversary of the June 4, 1989, crackdown. But some see worrying signs that the leadership remains instinctively hostile to political discussion and more independent news media. Scholars say they now suspect that Mr. Hu is not as forward-looking as they had once hoped, and at any rate he must still defer to Jiang Zemin, the military chief, who handed the formal reins of power to Mr. Hu in late 2002 but by many accounts remains a domineering influence....

Subject: Krugman's Korean Eds. From: Soonmyung Hong To: All Date Posted: Sat, May 01, 2004 at 23:50:19 (EDT) Email Address: sonnet@teatime.org Message: you can see book image although it is written korean. Great Unraveling: http://www.yes24.com/home/pd.asp?SID=xxGMjqtfSGa*LtHNq8i70txdQAQGL7Hp40kTpjWqLkY4U8VIdVoHD7cva&AK=420876&TABID=0 The Accidental Theorist: http://www.yes24.com/home/pd.asp?SID=xxGMjqtfSGa*LtHNq8i70txdQAQGL7Hp40kTpjWqLkY4U8VIdVoHD7cva&AK=299576&TABID=0 Peddling Prosperity: http://www.yes24.com/home/pd.asp?SID=xxGMjqtfSGa*LtHNq8i70txdQAQGL7Hp40kTpjWqLkY4U8VIdVoHD7cva&AK=35978&TABID=0 The Self-Organizing Economy: http://www.yes24.com/home/pd.asp?SID=xxGMjqtfSGa*LtHNq8i70txdQAQGL7Hp40kTpjWqLkY4U8VIdVoHD7cva&AK=314487&TABID=0 The Return of Depression Economics: http://www.yes24.com/home/pd.asp?SID=xxGMjqtfSGa*LtHNq8i70txdQAQGL7Hp40kTpjWqLkY4U8VIdVoHD7cva&AK=71417&TABID=0 http://www.yes24.com/home/pd.asp?SID=xxGMjqtfSGa*LtHNq8i70txdQAQGL7Hp40kTpjWqLkY4U8VIdVoHD7cva&AK=420876&TABID=0

Subject: Thailand Utility Privatization From: Emma To: All Date Posted: Fri, Apr 30, 2004 at 17:19:38 (EDT) Email Address: Not Provided Message: http://www.nytimes.com/2004/04/30/business/worldbusiness/30egat.html General Strike Threatened Over Thai Utility Proposal By WAYNE ARNOLD SINGAPORE - After two months of daily protests, unions representing Thailand's public-sector employees plan to use a huge May Day rally to call for a general strike against plans by Prime Minister Thaksin Shinawatra to privatize part of the national electric utility, the Electricity Generating Authority of Thailand. With his public approval soaring along with the economy last year, Mr. Thaksin dusted off a decade-old plan to sell part of the authority, known as EGAT, on the stock market so that it could more easily finance new power plants to feed rapidly growing electricity demand. The partial privatization of EGAT stood to be Thailand's largest initial public offering ever, raising as much as $1.8 billion for 30 percent of the company and serving as the centerpiece of a wider effort to sell some 20 other state-owned enterprises. But Mr. Thaksin, who has been criticized for his autocratic 'C.E.O. style,' appears to have met a formidable adversary in EGAT's employees' union. Faced with relentless protests, Mr. Thaksin has delayed the sale indefinitely, though he insists it will still happen. Now, the unions are trying to force him to cancel the sale altogether, and some union members are already staging limited walkouts. 'We would like to demand that the government stop privatization in the energy sector,' said Somsak Kosaisuk, secretary general of the State Enterprises Labor Relations Confederation, whose 42 member unions represent 230,000 workers, slightly more than a third of the country's unionized workers. Union troubles are just part of a long list of problems that have put Mr. Thaksin, a telecommunications tycoon who swept to power in 2001 on a populist platform, on the defensive....

Subject: Re: Thailand Utility Privatization From: Mik To: Emma Date Posted: Mon, May 03, 2004 at 12:17:37 (EDT) Email Address: Not Provided Message: To Privatise or not to Privatise - that is the question.

Subject: And the Rich Get Smarter From: Emma To: All Date Posted: Fri, Apr 30, 2004 at 15:58:51 (EDT) Email Address: Not Provided Message: http://www.nytimes.com/2004/04/30/opinion/30KIRP.html And the Rich Get Smarter By DAVID L. KIRP BERKELEY, Calif. Yet another string of studies confirms what any high school senior or parent who has just weathered the college admissions mating dance already knew — it's a cutthroat competition where money matters more than ever. Teenagers from wealthy families are beating out middle- and working-class youngsters, both at top private colleges and flagship state universities whose historic mission of broad access is receding into memory. The trend means that 'smart poor kids,' as the educator Terry Hartle bluntly puts it, 'go to college at the same rate as stupid rich kids.' A lot of not-so-secret factors are at play in this market. In pursuit of competitive advantage, well-off parents spend thousands of dollars on test prep courses, college admission summer camps and 'dress for success' counseling. They are more adept than their less well-heeled rivals at working the system; that brings results, especially at prestigious universities. At the other end of the spectrum, the inequity is worsening as cash-starved state schools are forced to raise tuition — an average of 14 percent last year. For fall 2003, for example, community college fees in California rose to $18 a class hour from $11. Though that typically amounts to only about $100 a semester, enrollment was more than 100,000 below the state's projections. Why? Sticker shock scares away poorer students from even applying. The one bright spot is that academic leaders are now discussing this wealth gap. William Bowen, the former president of Princeton, made headlines when he assailed elite colleges — presumably including his own — as 'bastions of privilege' and urged putting 'a thumb on the scale' for poor students. Amherst's president, Anthony Marx, has made the same argument. Harvard's president, Lawrence Summers, announced that parents who earn less than $40,000 a year will no longer be asked to contribute financially to their offspring's education. That's a start, but much more is needed if such students are going to be a presence in Harvard Yard. Those who run universities bear considerable responsibility for creating these inequities — and not only in admissions. These trends are just the most visible sign of how much the market ethic has come to dominate higher education. To be sure, dollars have always greased the wheels of academe. What is new and troubling is the raw power that money exerts over all of higher education, including the emphasis on research that adds less to the storehouse of knowledge than to the institutional coffers, and the shift from liberal arts to the 'practical arts.' While competition has strengthened some colleges, embedded in the very idea of university are values the market does not honor: the belief in a community of scholars and not a confederacy of self-seekers; in the idea of openness and not ownership; and in the student as an acolyte whose preferences are to be formed, not a consumer whose preferences are to be satisfied....

Subject: Re: And the Rich Get Smarter From: Mik To: Emma Date Posted: Mon, May 03, 2004 at 12:46:52 (EDT) Email Address: Not Provided Message: Emma, Can you look out for articles on abuse of profits by educational institutions? I believe we are actually seeing a strong trend by universities to keep raising their rates well above inflation levels makes university fees slide further and further out of the affordability of the average people. This has a serious problem if you consider a person taking out a loan to cover tuition and finding that in a 'world job market' where more and more jobs are going to countries like China or India, this person may well not be able to find a job or a payment package that will pay back that loan. The biggest problem for me is the costs running a university. It appears that there is an abuse going on here and that university professors want to place their income salaries into the same category as high rolling bankers. BUT! this is my own impression and I could be wrong. So if you come across any more articles on this matter, please post them. Thanks

Subject: Smart people find a way From: Econochick To: Mik Date Posted: Mon, May 03, 2004 at 17:27:52 (EDT) Email Address: Not Provided Message: The issue isn't abuses but naturally rising costs. Mind that colleges and universities are like boarding schools and have much higher costs than your average public high school outside of the cost of education alone. University salaries are not out of control and don't need to be. As Paul G. Brown points out, professors are free to work as consultants, start businesses, etc. A position at a top university certainly helps the professor market him/herself. And even classics professors get consulting gigs. As for covering costs, economists have repeatedly concluded that a college education returns the cost of education hundreds of times over. Tuition has not risen enough to eliminate that. The jobs that are going to china to do not require expensive educations - I wouldn't lose sleep over that. Besides, having a college degree opens doors other than the ones directly related to your major. In addition, there are endless financial aid programs from private endowments to merit scholarships to income based programs. I was on the very low end of the economic scale when I went to college. I was in the lowest tax bracket and I got scholarships, took loans and worked full time to put myself through school (I went to an expensive school). Was it easy? NO. Was it worth it? A thousand times YES. But who said that life will be easy? Rising costs should not be another excuse to be lazy. And they don't mean that universities are cheating.

Subject: Re: Smart people find a way From: Paul G. Brown To: Econochick Date Posted: Mon, May 03, 2004 at 18:39:45 (EDT) Email Address: Not Provided Message: I've heard this argument before: that there are enough scholarships or financial support programs out there making it possible for anyone who is smart enough to get into a good school. While it is true that the possibility is there, that often isn't enough. People vary not only in their intellectual capacity but also in their personality, and their character. To make the leap from outsider to good-school-graduate you not only need to be bright enough, but you also need a degree of drive and self-confidence. Some people simply don't have these at the point in their lives when they are making these decisions. Put a bright but callow youth in a good school and they gain self-confidence because they excell. Why should we care about the fact that places at good schools are being taken up by those endowed with a small brain but a large trust fund? Because a policy that leads to this outcome falls far short of maximizing our collective human potential. I mean, would you rather see Paris Hilton at Stanford (she has the money and the moxie) or 'Tayshaw Green' (18 YO mother of one and unwilling validectorian of Compton High School)? Who is more likely to find a cure for cancer in ten years time? Making it unnecessary for kids of proven ability to have to struggle too hard (I ain't advocatin' open universities, y'all) would result in higher returns on the social and economic investment we make in education.

Subject: Re: Smart people find a way From: Econochick To: Paul G. Brown Date Posted: Tues, May 04, 2004 at 09:21:18 (EDT) Email Address: Not Provided Message: Paul, your point is well taken. I have repeatedly said that education is the best use of public funds that I can think of because the payoff is so enormous. However, the 'Paris Hiltons' are less likely to find a cure for cancer (or anything else) because they are less driven and have less at stake. Kids who take out loans and take part-time jobs to get through school do better afterward because moxie is often more important than brains in the business world. Also, Paris Hilton is hardly representative of most children of the well to do. Most professional, well to do people in America are self made and have above average IQs - which are hereditary. In those families there is a culture of education and it is expected. Paul, how many teenage mothers are reluctant valedictorians??

Subject: Re: Smart people find a way From: Paul G. Brown To: Econochick Date Posted: Tues, May 04, 2004 at 14:10:38 (EDT) Email Address: Not Provided Message: > Paul, how many teenage mothers are reluctant valedictorians?? Well, I'm going to guess a lot more than there are multi-millionaire stars of reality TV and the tabloids! And we are all better off if they have the same educational opportunities. And the question of genetics and IQ is an enormously complex one. Your argument--that intelligence is hereditary -- is the same one put forward -- though in a less sophisticated form -- by 19th and early 20th century conservatives who objected to the creation of state run education systems. If this argument is true it follows that spreading the investment across all socio-economic strata is wasteful. Look at racehorses. Rather than train a wide swath of horses the sport instead concentrates on a few 'blood-lines'. By contrast, over and over again we have evidence of individuals from non-privileged backgrounds (indeed, entire populations of immigrants from areas written off as incurably backward and stupid) excelling once granted an opportunity. I came to this position after reading Dawkins and Dennett on genetics, Gould on (mis)measurement, and even Charles Murray for a well expressed and thorough coverage of the other point of view.

Subject: Re: Smart people find a way From: Econochick To: Paul G. Brown Date Posted: Tues, May 04, 2004 at 15:43:10 (EDT) Email Address: Not Provided Message: 'Well, I'm going to guess a lot more than there are multi-millionaire stars of reality TV and the tabloids! And we are all better off if they have the same educational opportunities.' Right, Paul, so the point is that using outliers to create public policy or examples in arguments is wasteful. I have never heard of a Paris Hilton doing well in an Ivy league school and I have never seen a reluctant Valedectorian (with or without children). People who are as stupid as Paris do not succeed and people who are as reluctant and teenage mamma don't succeed either. You need both brains and moxie. IQ is hereditary (I am not an expert and got this from someone who is a research scientist in that area). However, IQ is somewhat changeable. Also, IQ only measures boundaries. Take a person with a large IQ and deny education and you will have one stupid !(#*. With an education, a person with a high IQ can become the proverbial rocket scien