Wednesday, June 30, 2010

Excellent Video on Public Sector Pension Debt Avalanche

Cities are forced to reduce the size of their police and fire departments in order to pay the princely pensions of healthy 50 somethings in the prime of their lives. Swimming pools for kids are being closed down, and vital services are being curtailed so that clerks, bureaucrats, and mid level managers can live like millionaires for a longer period of time than they ever worked.

It is not sustainable, folks. It is a slightly subtler form of piracy than the warlords and warrior kings utilised, but piracy all the same. The longer it takes to bring back to sanity, the more bitter the ending will be.

Tuesday, June 29, 2010

A Moment of Honesty: Caught In One's Own Web

The current president of the US is generally caught up in his own sense of destiny.  But now and then bits and pieces of reality slip through the cracking facade.  And despite the best efforts of a massive news media that adores and covers for him, a massive pseudointelligentsia in academia and professional punditry hungry for radical change, tax supported public sector unions willing to use the fist and club to protect his standing, and a leftist base still living in a fantasyland of wish fulfillment -- the US economy is crumbling beneath the bloating Obama-ocracy.

What else can the economy do?  Obama has crushed private investors, private entrepreneurs, small business -- all the usual sources for new job growth and the expansion of wealth in a healthy private sector.  No one in the Obama administration understands the private sector and its vital role in a healthy economy.  Too, too bad.
I am sick of Keynesian clowns who do not know the cart from the horse, who think debt is a free lunch, who think spending and debt are the ways to get out of debt problems and most of all never say how this debt is going to get paid back.

What causes depressions is an unsustainable runup in credit and debt that precedes it, NOT a failure to go deeper in debt.

Anyone who understands 5th grade math should be able to figure that out. Unfortunately, Nobel prize winning economists can't. _Mish

Structural problems are immense and the sad fact of the matter is those problems cannot be cured by more deficit spending. Krugman is correct about a depression, just wrong about the cure. Logically the disease and the cure cannot be the same.

"There is no means of avoiding the final collapse of a boom brought about by credit (debt) expansion. The alternative is only whether the crisis should come sooner as the result of a voluntary abandonment of further credit (debt) expansion, or later as a final and total catastrophe of the currency system involved." - Ludwig von Mises

...Congress and the Fed added to the misery by wasting trillions of taxpayer dollars bailing out banks and Wall Street while leaving the private sector in shambles, and millions of homeowners debt slaves to their houses.

Each time the day of reckoning is put off, the bigger the price down the road. Thus, we should all be fearing more Keynesian and Monetarist attempts to forestall the inevitable collapse.

Attempting to stave off further debt writedowns and another recession is like attempting to stave off a hangover by drinking more whiskey.

Yes there will be short term pain and lots of it to do the right thing now, but there will be greater pain down the road if we don't. _Mish

Americans elected this clown and his troupe. They are going to have to pay an immense price before they are finally rid of him.

The Fear and Hate that Leftists Feel Toward their Detractors


When the left wants to caricature its detractors, it has an entire palette of media colours with which to work. Late night talk and comedy shows are willing to do whatever it takes to ridicule anyone who publicly objects to the mainstream steamroller of expanding central control and dictate.

The rules are different when the left attacks the center or the right. When the left is on the attack, there are no limits, no rules of conduct, nothing beyond the pale -- everything is allowed, including violence and various forms of privacy invasion. The end justifies the means, when you are assured of your own righteous purity in the service of the One Truth.

Understanding the way that a person's brain would have to be wired in order to derive any type of assurance or self-confirmation from viewing the caricatures pictured above will leave an educated observer more than a bit discomfited. It is rather like the way a Palestinian's brain is wired, that leads him to rip an Israeli to bloody pieces with his bare hands. Disturbing.

Humans are naturally violent, so it is necessary for any surviving human populations to possess the capacity for violence -- if only in self-defense. But when latent human violent tendencies are stoked by political opportunists, the problem can become endemic or institutionalised. Such perverted societies can promote war in the name of peace, or genocide in the name of tolerance.

Why the left lends itself to this approach is fairly easy to see. It is desperation and fear of loss of power. Such desperation can be used to excuse virtually anything. And it will be.

Monday, June 28, 2010

Is Everything You See, Hear, and Read in the Media Wrong?

It often seems as if the news media is just one giant distraction from the things that people should be paying attention to. The "media as smokescreen" meme is a fairly accurate way to look at the mainstream.

America's demographic makeup is changing, but the US may be the only advanced industrial nation to have a healthy supply of young workers in the year 2050. For the future of African American communities, the greatest threats come from within themselves.

If the US can only survive its greatest threat since slavery -- The Obama Syndrome -- it may revive itself in the post-Obama age. With the threat of a worsening Obama Depression looming, America's approach to economics could certainly stand a hard reboot. The beginnings of the modern industrial age of capitalism were rough and rowdy. For capitalistic wealth creation to succeed, there must be areas of "open frontier", wild ranges of economic, technological, and real space to be explored and settled.

Europe is attempting to pull back from the abyss of financial collapse, but is Europe too deeply into the welfare state mentality to succeed? The emotional appeal of socialism may prove too strong for European intellectuals, despite its fatal flaws.

Sunday, June 27, 2010

Thanks Loads, Barney, You Pustular Disgrace

Congressman Barney Frank is the greatest defender of Fannie Mae and Freddie Mac in the US government. So if one is to blame Fannie and Freddie for a lion's share of the great economic bust of 2008, it follows that Barney is just as much to blame.
The current financial crisis did not happen because investment companies were dealing in derivative products that no one understood (the simplistic general Democratic explanation), nor was it a result of an abnormal growth in homeownership rates in the United States (the simplistic general Republican explanation). The real reason for our current crisis is that our economic leaders allowed Fannie Mae and Freddie Mac to mismanage mortgage rates and thus mismanage a substantial portion of our “debt economy” for more than twenty-five years.
Here are the facts that back up this statement. Exhibit 1 shows a 12-month running average plot of Freddie Mac single family fixed rate mortgages against the 12-month running average of the CPI between 1972 and 2008 (nearly the full period of time mortgage-backed securities had been issued prior to the recent financial crisis).

...For the last 27-years (almost the full time for a 30-year loan to mature), inflation as measured by the CPI has averaged 2.99%, yet only very recently have long-term rates begun to come into sync with long-term inflation. With mortgage-rates set so far above what they should have been set in 1983, Fannie Mae and Freddie Mac were allowed to establish a policy that slowly lowered mortgage rates year after year, in effect allowing us to enjoy one refinancing cycle after another so that their mortgage portfolios could grow and grow and grow.

...One, the Federal Reserve was asleep at the wheel. Even though we may revere our esteemed Reserve economists; the Federal Reserve never understood mortgage debt, nor did they ever question mortgage rate policy. Instead, the Fed simply received regular reports from Freddie Mac telling them what the current GSE mortgage rate policy was. The Fed either was ignorant or played ignorant while we added nearly $7.5 Trillion in “new mortgage debt” during the fifteen-year period between 1992 and 2007. Talk about Keynesian economics! Any Reserve Chairman of the Great Depression era would have been envious of what Alan Greenspan was allowed to get away with while collecting accolades—and that does not include the stimulus that was being added during his reign from our Government’s deficit spending and growth in our “national debt”.
Two, demand for Mortgage-Backed Securities, was always there. MBSs have always served as one of the best “risk free” hedges against inflation. An 18% MBS when compared against a 3% long-term inflationary perspective is an extremely attractive product, as is a 14% MBS, as is a 10% MBS. Need I go on? Anyway, what could be safer than investing in American housing? The stock market carries risk, does it not, or have we forgotten what happened in 2000-2001?

So for twenty-five years we Americans took advantage of mortgage rate mistakes made by the GSEs going back as far as the early 1980s to live off our houses and build up our debt to unreasonable levels, while the executives at the GSEs gloated over their growing MBS portfolios and their “well-deserved” bonuses. The money-making machines that the GSEs owned were the envy of Wall Street bankers, so they, too, joined into the game. After all, housing prices would never fall—another gross misconception made by our elite financial leaders. _BI

The situation is still settling out from those decades of plundering by Fannie, Freddie, Barney, friends of the Fed, Goldman, and everyone else who belongs to the revolving-door-of central banking, the government treasury, and big finance.

And Barney just laid the foundation for yet another round of the same bubble, starring the same players as the last bubble of devastation.

Photo credit

Needed: Food that Plants, Cultivates, and Harvests Itself


Humans have always dreamed of a Garden of Eden where they could pick their food fresh from the vine every day, without want or toil. One possible step in that direction is the development of perennial grain crops, which survive to grow in the same soil year after year.
Perennial grains would be one of the largest innovations in the 10,000 year history of agriculture, and could arrive even sooner with the right breeding programs, said John Reganold, a Washington State University Regents professor of soil science and lead author of the paper with Jerry Glover, a WSU-trained soil scientist now at the Land Institute in Salina, Kansas.

“It really depends on the breakthroughs,” said Reganold. “The more people involved in this, the more it cuts down the time.”

Published in Science’s influential policy forum, the paper is a call to action as half the world’s growing population lives off marginal land at risk of being degraded by annual grain production. Perennial grains, say the paper’s authors, expand farmers’ ability to sustain the ecological underpinnings of their crops.

“People talk about food security,” said Reganold. “That’s only half the issue. We need to talk about both food and ecosystem security.”

Perennial grains, say the authors, have longer growing seasons than annual crops and deeper roots that let the plants take greater advantage of precipitation. Their larger roots, which can reach ten to 12 feet down, reduce erosion, build soil and sequester carbon from the atmosphere. They require fewer passes of farm equipment and less herbicide, key features in less developed regions.

By contrast, annual grains can lose five times as much water as perennial crops and 35 times as much nitrate, a valuable plant nutrient that can migrate from fields to pollute drinking water and create “dead zones” in surface waters.

“Developing perennial versions of our major grain crops would address many of the environmental limitations of annuals while helping to feed an increasingly hungry planet,” said Reganold.

Perennial grain research is underway in Argentina, Australia, China, India, Sweden and the United States. Washington State University has more than a decade of work on perennial wheat led by Stephen Jones, director WSU’s Mount Vernon Research Center. Jones is also a contributor to the Science paper, which has more than two dozen authors, mostly plant breeders and geneticists. _WSUNews_via_BrianWang

Original study in Science (via Brian Wang)

Al Fin would prefer that more effort go into the development of a perennial barley -- rather than wheat. Beer made from barley is infinitely better than beer from wheat, and who has ever heard of a single-wheat Scotch? No, the best whisky is single malt, the malt being made from barley.

We are in the midst of a biological revolution. That revolution will certainly spread to agriculture, and everything else that biology touches. Fuels, chemicals, animal feeds, plastics, and more.

Expect conventional food crops and innocuous ornamentals and wild forage to be modified to produce virtually any chemical, any compound. I think you can see with a little imagination, that things are already well out of hand and soon to be completely out of control. Try to use your brain, because by the time the reality of tomorrow's harvest hits the mainstream, it will already be too late for the dull majority.

Thursday, June 24, 2010

Americans Have 2 Years to Put Their Economic Affairs In Order

As Niall describes, when the debt loads become so large, it only takes a small increase in rates to create a fiscal crisis because you become overwhelmed by the huge amount of debt issuances that you need to service. For example: Increasing interest rates by 2% on bonds with the overwhelming amount of debt we have today might be the equivalent of taking rates to 8-10% in the early 1980's when it comes to the percentage of GDP it will cost us to service the debt (pay interest on the debt).

The bond market will eventually call the Fed out by taking rates higher as they begin to realize that our GDP will simply not be large enough to service the debt.

Will the PIIGS and the rest of Europe get called out before us? Sure, but eventually we will end up in the same place; our situation is no better. We get a pass for now because we are still considered to be the safest haven left. Or as I like to say: The best of the worst!

This is all unsustainable and I think the reality is beginning to set in that we cannot continue to spend like this. Anyone that has a job and pays bills understands that you cannot spend more than you bring in every month over a long period of time without going bankrupt.

The problem we have here is the political will is not there to make painful decisions we need to make in order to clean up our fiscal house. It's going to take a fiscal crisis similar to Greece in order to finally force the government to clean up its balance sheet.. _SeekingAlpha
There will be no fiscal discipline, no national fiscal housecleaning. Not under Obama Pelosi or any equivalent government. That is why Americans -- and all who rely on the American economy -- need to put their economic affairs in order.

The blowback from this debt buildup will be devastating, and global in extent. The US needs to begin pulling back its military forces -- particularly ground forces -- before the US government loses all credibility. Otherwise, the precipitous withdrawal of overseas troops made necessary by the economic collapse of the US government, may resemble Dunkirk.

Obama is determined to turn Afghanistan into another Vietnam. If his economic policies create the disastrous collapse that many observers anticipate, he will succeed in his perverse determinations of designed defeat.

Sunday, June 20, 2010

We Are Marching to Utopia...We Will Soon Be There

...optimists and idealists -- with their ignorance about the truths of human nature and human society, and their naive hopes about what can be changed -- have wrought havoc for centuries....instead of utopian efforts to reform human society or human nature, we [should] focus on the only reform that we can truly master -- the improvement of ourselves through the cultivation of our better instincts. _OUP Review of "Uses of Pessimism"
Sure as I know anything, I know this - they will try again. Maybe on another world, maybe on this very ground swept clean. A year from now, ten? They'll swing back to the belief that they can make people... better. And I do not hold to that. _Captain Malcolm Reynolds
There is something deep in human nature which has resisted change -- despite the best efforts of crusaders, utopians, religionists, and wishful thinkers -- for many [tens of?] thousands of years. After countless failures to reform the human spirit, most utopians are unfazed. If they can only grab enough power and control over how resources are distributed, they are sure that they can bring perfection to the land, under their own benevolent leadership. "The land will heal, the sea levels will begin to subside, and every man will say to every other man, you are my brother." And so on.

Philosopher Roger Scruton -- author of The Uses of Pessimism -- takes a somewhat more reluctant view:
The belief that humanity makes moral progress depends upon a wilful ignorance of history. It also depends upon a wilful ignorance of oneself – a refusal to recognise the extent to which selfishness and calculation reside in the heart even of our most generous emotions, awaiting their chance. Those who invest their hopes in the moral improvement of humankind are therefore in a precarious position: at any moment the veil of illusion might be swept away, revealing the bare truth of the human condition. Either they defend themselves against this possibility with artful intellectual ploys, or they give way, in the moment of truth, to a paroxysm of disappointment and misanthropy. Both of these do violence to our nature. The first condemns us to the life of unreason; the second to the life of contempt.

...In order to see human beings as they are, therefore, and to school oneself in the art of loving them, it is necessary to apply a dose of pessimism to all one’s plans and aspirations. _GloomMerchant
In another piece, Scruton presents a paradoxical recommendation for how to teach children to think for themselves, logically and clearly:
...children are drawn to magic...they spontaneously animate their world with spirits and spells...they find relief and excitement in stories in which the heroes can summon supernatural forces to their aid and vanquish untold enemies – these facts reflect layers of deep settlement in the human psyche. But they also remind us that, in the life of the child, belief and imagination are not to be clearly distinguished, and that both serve other functions than the pursuit of truth.

...humanists should wake up to this point, and be careful when they seek to deprive their children of enchantment, or to replace their spontaneous fantasies with the cold hard facts of empirical science. It could well be that religion is a better discipline than pop science, when it comes to shaping the rational intellect, and that [we can offer our] children more in the way of a solid foundation, by anchoring their imagination in sacred stories and religious doctrines, than they are likely to be offered by those “Darwinian fairy tales’” as David Stove has called them, which have gained such currency in the wake of Dawkins and Hitchens.

In response to a child’s metaphysical curiosity grown-ups can say that everything has a scientific explanation. But they will know that this is a lie. The proposition that everything has a scientific explanation does not have a scientific explanation – it describes an amazing fact about our universe, a point where reasoning falls silent. There are many such points, as anyone who has children knows: why is there anything? Why should I be good? What existed before the Big Bang? What is consciousness? You can wrestle with these questions through philosophy, but science won’t answer them.

Children have an inkling of this. They also recognise that behind these questions lies a huge void – an emptiness which must be filled with love and reassurance, if their existence is not to seem like an accident. _Art_of_Certainty
Utopians try so hard to purge their children's minds of falsehood and "error", to create the perfect children of rational thought, capable of seeing through all the corrupt fables of the past. Except...children will be who they will be. You cannot make boys into girls or girls into boys without destroying who they are. And you cannot make humans into angels without ruining the essence of what they are. And still the utopians continue to try -- until they finally throw their hands up in complete exasperation at and condemnation of the utter evil of those who do not think along the same lines as themselves, the utopians.
The disgusted dismissal of homo rapiens and all his works that we find spelled out by John Gray in Straw Dogs is not a form of pessimism. It is an attempt to dismiss humanity entirely, as a kind of plague on the face of the earth. That kind of misanthropic nihilism is of no use to us. It removes the ground from all our values, and puts nothing in their place. _GloomMerchant
At that point, they often begin to plot and fantasize the great dieoff, to cleanse the otherwise pristine Earth of the incorrigible human demons who infest the lands and oceans. Fortunately, utopians are as incompetent in planning the great dieoff as they are in most other aspects of their lives.

The point is not to resist all change or improvement of humans. But any lasting change for the better is likely to happen from the bottom up, not from the top down.

Nothing illustrates the different approaches to a better world than the contrast between the French and American revolutions of the late 19th century.
The primary difference in causes that led to the American Revolution and the French Revolution was based in the world view of the innate goodness or innate evil of man. _Hyperhistory
Not all utopians believe in the innate goodness of men -- sometimes they only believe in the innate perfectibility of men. But utopias born of such ideas all come to a bitter end.

Every child has to learn to think for himself, from the beginning. But he must have a beginning from which to start.
The need for foundations is quite clearly an adaptation, and these foundations must provide the promise of protection and love, if they are to fit the new organism for its brief time in the world. If that is so, you are not going to eliminate the need for faith: the best you can do is to withhold all objects of faith, so that a child goes hungry into the life to which he or she is destined. More often than not, a humanist education will leave a child exposed to massive and mind-clogging superstitions of the Harry Potter and Star Wars kind. But these superstitions contain far less in the way of insight than is contained in the first chapter of Genesis.

Religious stories are also the result of natural selection – though selection at another level: they have come down to us because they have fulfilled a moral need. They have survived refutation because they contain, beneath their superficial falsehood, the moral truths that people need, when they must order their lives by good examples. _The Art of Certainty
This is true not only of religious stories, but of all the mythology and lasting moral fables from antiquity. Children must have some kind of foundation that transcends deductive logic, because that is how minds begin. Then, later, when they choose to either reshape or reaffirm their beliefs, they will have a sense of having decided for themselves, and feel stronger for it.

Yes, humans can make choices that make them better. Improved nutrition of mother and child can make humans stronger, smarter, taller, and sometimes capable of clearer thought. But a power structure that attempts to legislate morality, to engineer the moral and ideological purity of the human souls of its citizens -- that power structure is morally bankrupt, and deserves to die quickly. If it is allowed to continue, its leaders will eventually decide that the recalcitrant citizens do not deserve the benefit of the leaders' great wisdom. Then, beware.

This question has been acquiring an ever greater urgency over the past century -- even longer. It is now coming to a head in the demographic and economic crises of many of the world's most advanced nations. A culture that has rested on its own laurels, that has comforted itself with mental images of its own progressive improvement, is soon to be reawakened to a coarse and unruly history.

Previously published at Al Fin blog.

Saturday, June 19, 2010

Remind Me, Which Country Elected Obama President?

You might think that Mexico elected Obama president of the US -- or any country wanting to pick America's pocket, for that matter. Obama is the biggest catastrophe to befall the US since the founding fathers neglected to prohibit slavery in the southern states as a condition for statehood. Yes, that's right. Obama is the greatest disaster to befall the US since slavery.

Watch as the disaster unfolds, step by step. The US is too poor to afford an incompetent buffoon as president. Particularly a buffoon who hates his own country. This cannot end well.

Friday, June 18, 2010

A "Funny" Thing Happened On the Way to the Recovery

A few people are beginning to notice that we are not experiencing a typical recovery.
1. Job growth will be anemic at best. Given the layoffs necessitated by the dire straits of the State government finances, the completion of census work, and the lack of confidence in the small business community; I believe we will have a negative monthly jobs print by the end of the third quarter and very poor job growth into 2011

2. Taxes, user fees, license costs, and a variety of other costs will be increasing at the state level for consumers and businesses as legislatures throw everything but the kitchen sink (other than renegotiating pension, salary, more flexible work rules, and/or retiree health benefits with their unionized, overpaid and bloated public workforces that is) to try to balance their budgets.

3. The slowdown in Europe caused by the debt crisis will easily knock 25 basis points of projected domestic growth in the second half of the year

4. The fallout from the oil spill in the gulf will be felt by the Gulf states throughout the summer and will have an uncertain but negative impact on growth

5. The housing market will not recover in the second half in the year. Given recent reports and surveys it seems certain to stay dismal for the foreseeable future

6. A significant slowdown in China is likely in second half for a variety of reasons
a. Measures the government is taking to curb the bubble in the property market
b. Rising interest rates are likely to battle increasing inflation
c. Worker riots/strikes/increased wage demands are likely to squeeze margins and/or reduce productivity
d. Slowdown in Europe will impact growth at it accounts for 22% of Chinese exports
7. Corporations are likely to continue to hoard cash. They currently have 1.84T in cash on their balance sheets, a record. Concern about a slow and uncertain economy as well as an administration/congress that is anti-business, pro-union and increasing regulations by the day, will not do anything to facilitate deploying that capital into the economy

8. Taxes are going up for consumers and businesses at the Federal level starting Jan 1st, 2011. Income taxes on top earners, dividend and capital gains taxes in particular will increase significantly

9. Earnings comparisons are going to get much tougher in the second half of the year. The 1st and 2nd Quarters of 2009 were horrendously bad and beating them was akin to stepping over an ant. 3rd and 4th quarter comparisons will be more difficult to beat to the same degree

10. For a variety of reasons including new regulations, a steep yield curve that provides banks a massive incentive to invest in Treasuries instead of making new loans, still high delinquency and write off rates, lack of recovery in the securization markets, etc….lending will not recover in the near future and provide the fuel for economic growth to the extent that it has in past recoveries.

...The market has basically gone nowhere since the first of the year with the S&P 500 currently within basis points of where it started 2010. Given growth in the second half is likely to be even weaker, and the substantial risks that either did not exist (Oil Spill) or were not readily apparent (Sovereign debt crisis, Chinese property bubble); the outlook for the market for the next six months does not look good. I believe the market has seen its highs for the year. In this environment it pays to be small, stay in the defensive sectors (Healthcare, Telecom, Consumer Staples,Utilities) that have not participated fully in the rally since the March 2009 nadir and have good balance sheets, solid dividend yields and reasonable valuations. It also is prudent to keep a substantial portion of your portfolio in cash as we should have lower entry points later in the year. Be careful out there. _SeekingAlpha

In the opinion of my uncle Al Fin, the author of the piece above is being inordinately optimistic. He is clearly underestimating the stupidity of the Obama Pelosi regime. That is not surprising, since the world has never seen such stupidity on a grand scale in its many-storied past.

Try to clear your own balance sheets, make preparations for an extended dry spell, and hold on.

More: How to plan for a double dip "recession" (with a "d")

Instructive slide show

10 things that are hard to live without

Thursday, June 17, 2010

Economics 101: Government Making Economy Weak

Wage laws are just one of many dozens of ways that government hurts the economy.

This video takes a quick look at the effect of minimum wage laws on the employment prospects of young workers and minority workers.

Thanks to News Alert and MJPerry

This Kind of Hatred Does Not Spring Up Overnight

The Knoxville News Sentinel won an Edward R. Murrow award for the documentary covering the Channon Christian and Christopher Newsom murders in Knoxville, Tennessee. (via Instapundit)

From the nature of the crime described in the video above, and other similar crimes -- including the Wichita Massacre in Kansas -- it is clear that many black Americans have been stewing in a deep pathological hatred of whites for a long time. When such rabid race haters are presented with an opportunity to act out their violent fantasies, some of them cannot resist.

With a 70% rate of illegitimacy nationwide, a large underclass that experiences perpetual academic and occupational failure, and with a popular culture steeped in a hip-hop overflowing with violent imagery, it is no wonder that such a large part of America's black community suffers from such pathological violence and hatred. American prisons are disproportionately full of black prisoners, despite the fact that in many cities a relatively small proportion of offenders actually go to prison.

Every time such a murder occurs, the national news media hastily throws up blackout curtains around the event, and refuses to investigate or cover such crimes. By refusing to expose the virulent hatred of outsiders that has become so endemic within the insular black community, the media shirks its duty to inform the public. A clear exposure of incidents of such rabid and inhuman violence would likely cause many young people around the country to be much more cautious about their own personal security -- both at home and when moving about, particularly after dark.

The hatred is endemic within the sub-culture, smoldering relatively harmlessly for the most part. Most blacks who also happen to be racists, do not commit racist crimes -- just as most Muslims who sympathize with violent jihad do not commit violent acts. But when an opportunity to act out the hatred presents itself, the insanity too easily springs forth into violent action.

Being aware of the magnitude of such focused hatred, and the locations where one is apt to encounter it, might save the lives of a significant number of sociologically naive persons. It would be nice if the mainstream media would do its job of providing important information about crimes and common public hazards. The failure of the media is putting a lot of innocent people in harm's way.

Wednesday, June 16, 2010

Could A Different US President Have Prevented What's Coming?

John Robb was interviewed at Boing Boing (via ZenPundit), and the picture Robb paints in the interview is not very optimistic:
The United States is suffering both the economic decline of its industry and the ongoing dismantling of the social welfare apparatus supporting the citizenry. In your opinion, will this inevitably lead to some form of armed insurgency in America?

Yes. The establishment of a predatory and deeply unstable global economic system - beyond the control of any group of nations - is in the process of gutting developed democracies. Think in terms of the 2008 crisis, over and over again. Most of what we consider normal in the developed world, from the middle class lifestyle to government social safety nets, will be nearly gone in less than a decade. Most developed governments will be in and out of financial insolvency. Democracy, as we knew it, will wither and the nation-state bureaucracy will increasingly become an enforcer for the global bond market and kleptocratic transnational corporations. Think Argentina, Greece, Spain, Iceland, etc. As a result, the legitimacy of the developed democracies will fade and the sense of betrayal will be pervasive (think in terms of the collapse of the Soviet Union). People will begin to shift their loyalties to any local group that can provide for their daily needs. Many of these groups will be crime fueled local insurgencies and militias. In short, the developed democracies will hollow out.

How big of a domestic threat is there from the narco-insurgency in Mexico and the growing power of Latin American gangs in America?

Very big. A threat that dwarfs anything we face in Afghanistan (a useless money pit of a war). It's not a threat that can be solved by conventional military means, since the problem is that Mexico is a hollow state. Unlike a failed state like Somalia (utter chaos), a hollow state still retains the facade of a nation (borders, bureaucracy, etc.). However, a hollow state doesn't exert any meaningful control over the countryside. It's not only that the state can't do it militarily, they don't have anything they can offer people. So, instead, control is ceded to local groups that can provide basic levels of opt-in security, minimal services, and jobs via new connections to the global economy - think in terms of La Familia in Michoacana.

The real danger to the US is that not only will these groups expand into the US (they already have), it is that these groups will accelerate the development of similar homegrown groups in the US as our middle class evaporates.

Do you see a diminishing role for the state in large-scale governance? Does this compel communities to do it for themselves?

Yes, large scale governance is on the way out. Not only are nearly all governments financially insolvent, they can't protect citizens from a global system that is running amok. As services and security begin to fade, local sources of order will emerge to fill the void. Hopefully, most people will opt to take control of this process by joining together with others to build resilient communities that can offer the independence, security, and prosperity that isn't offered by the nation-state anymore. However, this is something you will have to build for yourself. Nobody is going to help you build it.

In what ways are the new methods of insurgency & terror instructive towards building strategies for resiliency?

Here are a few of the parallels:

* Powerful technologies. Inexpensive tools that make it possible to produce locally what it used to take a global economy to produce.

* Networks. The ability to draw on the ideas of hundreds of thousands of people working on the same problems through open source tinkering networks. The ability to create new economic networks that accelerate prosperity.

You're currently writing a book about local resiliency. What are the primary global drivers behind your interest in resiliency?

Yes, I am. It's about building resilient communities. Communities that offer energy independence, food security, economic prosperity, and protection. What are the global drivers that make resiliency important? Simply: stability, prosperity, and security is going away. You will soon find you are on your own, if you haven't already. If you do nothing, you will suffer the predations of gangs, militias, and corrupt bureaucracies that will fill the void left by retreating nation-states. If you want to avoid this fate, you can build resilient communities that not only allow you and your family to survive intact, but to thrive. My goal with my new book, is to provide people with a road map on how to build resilient communities from scratch.

What is the core messages you have to communities about preparing for the coming age?

Produce everything you can locally. Virtualize everything else. The value of your home will be based on the ability of your community to offer energy independence, food security, economic vitality, and protection. Survivalist stockpiles and zero footprint frugality are pathways to failure. Think in terms of vibrant local economic ecosystems that are exceedingly efficient, productive, and bountiful. _BB

You may also want to contemplate what would happen to a weakened nation as described by John Robb, when it is hit by an EMP attack. If 90% of Americans would die within 1 year of an EMP attack in a unified America, how many would die from such an attack in an America at war with itself?

Mr. Obama has brought accelerating division between the many cultures of a multicultural America. Was that his intent? Some of his earlier writings suggest that possibility. But we may never know.

Regardless, it is clear that Mr. Obama is completely over his head in any situation that requires wisdom, intelligence, competence, or all three. The challenges that Mr. Robb describes above go far beyond the problems that most presidents have faced. Needless to say, Mr. Obama will not make the situation better.

Friday, June 11, 2010

A Confused and Foolish Government in Washington

America has never suffered under a blatantly anti-business government before. Jimmy Carter and his wage and price controls was destructive toward markets, but his anti-business bias was at least well concealed behind a facade of toothy grins and "good ole boy" mannerisms. Obama makes no attempt to hide his contempt of markets, of US Constitutional protections from overbearing government, of traditional US allies...The Pelosi Congress is a perfect match for the anti-market bigotry of the Obama executive. And the results in the economy reflect the ugly bias in Washington.
Government employees are compensated 44% more on average per hour than private-sector employees, with 34.1% higher monetary wages and 66.4% more in benefits. On an annual basis, government workers make almost $80,000 on average with benefits (assuming a 40-hour week for 50 weeks), $24,000 more per year thatn the average private-sector worker ($55,460 annual compensation).

And one of the biggest differences between private and public employees is the "retirement" portion of benefits. Government workers are paid $3.16 in retirement benefits for each hour worked, and almost 90% of these retirement benefits are in the form of "defined benefits" and the other 10% are for "defined contribution." In contrast, private sector employees receive only $0.96 in retirement benefits for each hour worked, and more than 57% of this coverage is for "defined contribution" and less than 43% for "defined benefits." _MJPerry

The US Federal Debt can never be repaid, and yet it is growing at an exponential rate.

Not surprisingly, leftists are found to be economically ignorant relative to libertarians and others who reject leftism.

More segments from Steve Wynn interview

H/T News Alert

Wednesday, June 09, 2010

Explaining America's Dimwitted President

Update: An Alien in the White House?

Business-oriented persons are interested in getting things done, and in solving problems in order to accomplish that. Ideological persons are more interested in posturing and in establishing their good intentions and their authority to do what is best for everyone else. The Chinese of the 21st century fall more into the category of problem-solvers and business-oriented. That is perhaps why it is so hard to explain President Obama to the Chinese.
Ideological environmentalism has trumped economic development and has thwarted economic freedom, which was, ostensibly, the motive of the Cold War. Al Gore, before the Tipper French Kiss and before the Nobel Prize for the “Inconvenient Truth” wrote that the “internal combustion engine is the biggest threat to humankind.”

Tell that to the Chinese who are buying more than 40,000 new cars per day.

Make no mistake: global climate change rhetoric -- fully espoused by the Obama Administration -- is a frontal attack on the US and the lifestyle that emanates from its economy and system. The Europeans who adopted it in the first place are not averse to admit that they are jealous of America. The Chinese, who are all too aware of the ramifications of mandatory carbon restrictions on both the world and, in particular, their economy, simply will not play along. They are, at best, bemused. “We believe your science” they will say, saving themselves from entering the rat’s nest of climate science and its implications. But “you do the right thing. Reduce your carbon footprint. We will be applauding while we develop to your level.”

Meanwhile, we have an administration that came to power touting alternatives like solar and wind and the negative-energy-balance biofuels, which everybody, with any common sense, knows that they will never account for more than a couple of percentage points of the world energy mix. Without government subsidies they will be even less.

I had a hope that a president, any president, would level with the American people and explain for the first time that, for decades to come, there are no alternatives to oil, gas and coal. But then there was the BP disaster, providing almost gleeful fodder to the Obama Administration and its allies to reinforce their pre-ordained belief that oil is bad.

None of this prevents the Chinese from spanning the globe for oil and gas, while Americans are watching in a naïve stupor.

In just the last six months, Chinese oil giant Sinopec paid ConocoPhillips $4.65 billion to acquire its share in a Canadian tar sands project. That followed the company’s $2.46 billion acquisition of Angola’s deep-water oil reserves, a $7.56 billion acquisition of Swiss-based Addax Petroleum. CNOOC, China’s third-largest oil company, paid $6 billion to acquire the Brazilian Peregrino field. PetroChina gave Venezuela’s Hugo Chávez a $20 billion loan to be repaid by oil and that was in addition to the company’s announcement it will spend at least $60 billion over the next 10 years to acquire more oil and gas assets abroad.

The Chinese are actually bewildered. After a few drinks and when words become looser and in some ways, more lucid, they have one question. “Why are you letting us do it with no resistance and no competition?" They understand that energy means power and better economics. We no longer seem to get it. _EnergyTribune
Well, some of us get it, although the Obama Pelosi regime does not. But as long as Obama Pelosi is making the rules and steering the ship, America remains in deadly hazard from its dimwitted leadership, which observes the world through an ideological blindfold, and voluntarily wears a straitjacket of political correctness.

More: How to fight back against Obama's thuggish friends, the public sector employees' unions

Tuesday, June 08, 2010

Finding the Best Way to Learn and Taming Government Schools


Salman Khan studied math, engineering, computer science, and finance at MIT and Harvard. He began creating video tutorials on the topics that he was most familiar with, and has gone on from there. The Khan Academy is rapidly becoming legendary in the field of online education.
The most popular educator on YouTube does not have a Ph.D. He has never taught at a college or university. And he delivers all of his lectures from a bedroom closet.

This upstart is Salman Khan, a 33-year-old who quit his job as a financial analyst to spend more time making homemade lecture videos in his home studio. His unusual teaching materials started as a way to tutor his faraway cousins, but his lectures have grown into an online phenomenon—and a kind of protest against what he sees as a flawed educational system.

"My single biggest goal is to try to deliver things the way I wish they were delivered to me," he told me recently.

The resulting videos don't look or feel like typical college lectures or any of the lecture videos that traditional colleges put on their Web sites or YouTube channels. For one thing, these lectures are short—about 10 minutes each. And they're low-tech: Viewers see only the scrawls of equations or bad drawings that Mr. Khan writes on his digital sketchpad software as he narrates.

...Mr. Khan calls his collection of videos "Khan Academy," and he lists himself as founder and faculty. That means he teaches every subject, and he has produced 1,400 lectures since he started in 2006. Now he records one to five lectures per day.

He started with subject matter he knows best—math and engineering, which he studied as an undergraduate at MIT. But lately he has added history lectures about the French Revolution and biology lectures on "Embryonic Stem Cells" and "Introduction to Cellular Respiration."

If Mr. Khan is unfamiliar with a subject he wants to teach, he gives himself a crash course first. In a recent talk he explained how he prepared for his lecture on entropy: "I took two weeks off and I just pondered it, and I called every professor and everyone I could talk to and I said, Let's go have a glass of wine about entropy. After about two weeks it clicked in my brain, and I said, now I'm willing to make a video about entropy." _Chronicle

Thousands of students tune in to Khan Academy's YouTube channel every day, and many of them have left testimonials at the website. For the most part, Khan Academy is used by students enrolled in ordinary schools -- to help them get past the "sticking points" in conceptualisation that most technical topics can contain. But anyone can watch the videos -- and get a very broad education at the same time, for free.

The second topic of this post -- taming government schools -- deals with the increasingly critical way in which teachers' unions are being seen by parents, taxpayers, and some politicians.
What's missing every time this debate comes up is any actual defense of the basic and 100 percent undeniable trend line–we are paying much, much more money to deliver government services that (with few exceptions) are not performing any better, and the single biggest line item in that cost increase is employee compensation. The burden of proof is on the people pocketing our taxpayer dollars, and yet they continue to dissemble, whine, and change the subject (and sometimes even shrug), rather than robustly defending the public policy mess they have been instrumental in creating. As long as We Are Out of Money, they (and their apologists) will rightly be on the defensive._Reason

Public sector unions have gone way too far in stuffing their pockets with tax-supported benefits, future obligations to taxpayers, and mainly Democratic Party politicians who back up the public sector unions in their raping of the taxpayers.

Perhaps a bit of light thrown on the topic in the upcoming state and national elections will help to tame the savage public sector union predators on the public purse.

Monday, June 07, 2010

Obama Looks to Chavez in Dealing With Private Sector


US President Obama is growing more unpopular with everyone except government employees and the very young and senile. The collapse of the private sector in the US has left the president with few options other than to crank up the debt, and to blame Bush. Mr. Obama has tried to discipline the private sector, to make it behave more appropriately, but nothing he has tried has been effective.

But Mr. Obama has friends in other governments, who appear to be very successful in taming the misbehaving bourgeoisie. Besides the example of Fidel Castro, Hugo Chavez has made incredible strides in beating down a disloyal private sector:
Venezuelan President Hugo Chavez said he’s declaring an “economic war” against the “bourgeoisie” after business chambers criticized his handling of the economy and the performance of nationalized companies.
Chavez threatened to nationalize the country’s largest food maker, Empresas Polar SA, saying that the company isn’t “indispensable.” Chavez said Polar is manipulating workers into attacking his policies and he challenged company President Lorenzo Mendoza to see who will last longer. Mendoza, Chavez said, won’t get into heaven because he’s wealthy.
“You’ve declared an economic war against me, so I accept your challenge, stateless bourgeoisie,” Chavez said today during a visit to a state-run vegetable oil company. “I’m declaring an economic war with the help of the people and workers. War is war, my friend. Don’t complain to me later.”
Chavez has nationalized companies in the oil, food, cement and metals industries as part of his push for socialism and he blames the private sector for accelerating inflation and a recession that is forecast to continue into 2011. Chavez has threatened to nationalize Polar to boost state control over the production and distribution of food, and the government seized one of the company’s rice plants for three months last year.
The drive to construct a socialist economy has left the country facing international arbitration cases with Exxon Mobil Corp., ConocoPhillips and Mexican cement maker Cemex SAB. _businessweek

Yes, such behaviour is hard on an economy, but it makes a leader feel very strong and powerful. Such a boost of power is precisely what Mr. Obama needs right now. Obama's hold is weakening over economic sectors previously held in total thrall. Even the Obama-subservient news media has begun to risk muted criticism over inconsequential topics.

Perhaps Obama should nationalise the news media next?

Sunday, June 06, 2010

Governor Christie Standing Up to Schoolyard Bullies

Governor Christie is trying to save the state of New Jersey from bankruptcy. He is not getting much help from the public employees' unions in that regard. But Christie is not afraid to stand up to corrupt and entrenched power-groups who are indulging themselves at the public trough.

He has a long and dangerous fight ahead of him. If he succeeds, New Jersey may become a template for other troubled states trying to work their way out of public sector union induced debt and destruction.

Escaping the Hotel California

The study...confirmed projections that a steadily growing Hispanic population will surpass whites as the state's largest racial demographic in 2016. Hispanics are expected to become a majority of all Californians in 2042, Heim said. _
The overall population of California has grown, but the European-derived population of California is making way for the new majority-minority -- Mexicans and other Hispanics.
California's white population has declined since 2000 at an unprecedented rate, hastening the day when Hispanics will be the state's largest population group, according to newly released state figures.

There were half a million fewer whites in California in 2008 than in 2000, a period when the state's overall population grew by 4 million to 38.1 million, according to a study released Thursday by the state Department of Finance.

By 2008, whites made up 40 percent of Californians, down from 47 percent at the turn of the century. In 2000, Hispanics comprised 32 percent of the population; that number grew to 37 percent in 2008.

Analysts said the decline can be attributed to two main causes - a natural population decrease as Baby Boomers enter their later years and die at a faster rate than younger whites have children, and a migration from California since 2001 among whites who sought affordable housing as real estate costs soared.

...Hans Johnson, a demographer at the Public Policy Institute of California, said white women in recent decades have tended to pursue higher-education degrees and stay in the workplace, leading them to have fewer children. The white population is now "below the replacement" level, Johnson said. "They're simply not replacing themselves."

The median age among California's whites is 44, while the median age for the Hispanic population is 28, according to the study.

Stephen Levy, director of the Center for Continuing Study of the California Economy, said the study also reflected how skyrocketing real estate prices pushed workers from California during the housing bubble from 2005 through 2007.

..."California is no longer attracting large numbers of people from other states," Johnson said. "And a lot of those who did come to California from other states were white, reflecting the ethnic composition of the country as a whole.

"Now," he said, "that flow has dried up."

The decline among whites and increase in other groups in California is a long-standing trend, Johnson said.

"It's just faster now." _SFGate
Faster -- and more ominous, when you consider the economic output of the different groups, and levels of crime, poverty, illegitimacy, gang violence, school drop-out rates, and other variables determining the relative wealth and stability of a populace.

It is a very good trend for the California Democratic Party political machine. Not so good for the productivity of the state, or for the soundness of the underlying state infrastructure.

Friday, June 04, 2010

Mickey Kaus' 42 Minute Grilling by Reason Magazine

Why can't more candidates for office submit to the kind of extended questioning as Mickey Kaus does, without hesitation?

If Mickey Kaus succeeds in his run for the US Senate, and if New Jersey Governor Chris Christie is not killed by union thugs, this type of "speaking truth to corrupt unions" may become a saving trend in American politics.

Otherwise, the growing corrupt thugocracy of the labour union : Democratic party will sink the majority of US governments at all levels -- just as has happened in Greece and several other countries of Europe.

Thursday, June 03, 2010

72 Hijabs in a Cracker Jack Box

Islam is a religion by men and for men. Women belong to the head of the household, to do with as he wishes. The woman child belongs to the head of the household until he tells her she belongs to someone else -- another male head of another household. If a woman child allows her wrappings of virginity to be soiled by anyone but the master, her life is forfeit.
...male domination and female subjugation are Quranically prescribed, and who is Man to challenge the immutable Word of God—especially when God’s arrangements ensure perpetual male domination? This punitive patriarchy is not confined to Muslims in their own lands; it the West, in the lands to which Muslims immigrate, but whose “degenerate” and “sinful” societies they abhor.....the subjection of women within Islam is the biggest obstacle to the integration and progress of Muslim communities in the West. It is a subjection committed by the closest kin in the most intimate place, the home, and it is sanctioned by the greatest figure in the imagination of Muslims: Allah himself. _DB
Men of Islam do not wish to integrate with the west. They do not wish for the westerner's version of "progress." Men of Islam are born into a world of unlimited male dominance. Why would they give that up for western concepts of "equality" and "opportunity for all?"

There have been numerous honor killings in the United States, in which Muslim fathers or husbands kill daughters or wives who have “sullied” the family name in some way; and yet, ....not once has the achingly non-judgmental American press used the phrase “honor killing” in its reports on the murders _DB
Women are among the most prized possessions of the Muslim male. But they only hold their value as long as they maintain their innocence, in the eyes of the master. The moment the master perceives -- for whatever reason -- that innocence is lost, the life is forfeit.

Not every Muslim male is born into a privileged life of wealth, many wives, concubines, and female slaves. Some of them must roam western cities in gangs, to rape infidel women and Muslim women who appear to stray from the path. Others must fantasize of the 72 virgins who await him if he fulfills the conditions set forth for martyrdom -- the ultimate prize and reward, poured out of an exploding Cracker Jack box.
The women must be virgins as they change hands, from master to master. Without innocence of the chattel, the owner master's honour is lost, and can only be regained through the spilling of blood. It is a fetish of innocence, but instead of valuing one's own innocence it is the innocence of one's human possessions that is valued.

There is no escape from this fetish for the Muslim woman. No escape except the one she provides for herself. And if the woman does summon up the courage to escape, how is she regarded? A Somali taxi driver in Washington DC:
“What do you think of Ayaan Hirsi Ali… you know, the Somali lady?” He swiveled his head to fix me with his gaze, and then turned it back to the road. “Very bad person,” he said, after a strained pause. “We think she is a bitch. We hate her.” _DB
Yes, they hate her. They want to kill her, if they could only get past the bodyguards. Most escaped un-hijabbed women do not have bodyguards or protectors, even in the west. Western feminists and the western media and academia generally see these would-be liberated women as an embarassment to the post-modernist multicultural program.

Because if we ever did confront the deep and essential pathology of the Islamic community, what would become of "progressive multiculturalism?" If Muslim women are forced to wear hijabs as a "fetish of innocence hung tightly round the neck", then western post modern multiculturalists must all wear a fetish of feigned ignorance.

As the innocents are slaughtered by the Cracker Jack fireworks, and are sacrificed on the eternal altar of the master's honour, the monkeys of the west must always remember to cover their eyes, ears, and mouths, lest they sin against their own radical religion of "progressive dieoff progressivism."

Previously published at Al Fin

Why Are US Government Schools So Awful?

"Guggenheim's documentary focuses on aspiring students and their parents, mostly minorities, together struggling against the odds to get admitted into urban charter schools. Lacking the money for private schools, or move to the suburbs where the schools are better -- although not always good -- having only neighborhood high schools that are "drop out factories," these Americans have very few options. For many their only option is finding a decent charter school. But the odds for these young students to get selected in the lottery for a charter school is often worse than for students applying to Yale University.

And the film has villains. The clearly marked, cleared attacked villain that stands in the doorway to reforming our failing system of public education. The two major teacher unions! The two major teachers unions that together are the largest contributors to the Democratic Party; the Democratic Party that refuses to support legislation to require teachers to perform better and the Democratic Party that refuses to support legislation for the more innovative, less bureaucratic, effective charter schools. _MJPerry

It takes a cooperative effort between Democratic Party politicians and entrenched teachers' unions to create and maintain schools capable of destroying entire generations. So is the Democratic Party the villain? Are the teachers' unions the villains? Only when you combine the DP plus the unions to create one of the most corrupt and destructive cultural mind-killers imaginable.

Watch the trailer. Then visit the website of the film: Waiting For Superman
Then do whatever you think you should do.

Tuesday, June 01, 2010

Can California Handle the Truth? Mickey Kaus Will Find Out

Kaus reveals a lot of California truth in a very short campaign ad. Can the people of California handle it, or will they all faint dead away?

The problem of public sector unions destroying the budgets of county, city, and state governments is not unique to California. But because of California's problem with illegal immigration, the problem is likely to come to a head there first.

Leftist politicians in bed with public sector unions is a destructive combination that will prove deadly to a large portions of Democratic Party dominated US. New Jersey was desperate enough to elect a tough-talking Republican to the governorship in what was clearly a no-win, last gasp survival reflex. New Jersey may actually luck out, if their governor can survive all the thuggish union (and union proxy) attacks against him.

The other states, counties and cities in the same situation, who lack the survival instincts of New Jersey, may not make it.