Today’s Readings 1/18/2013
Happy Friday all! Ten readings for today. What are y’all checking out?
- Japan is likely so addicted to deflation that their economy will depressed for the long haul. Inflation is a necessity, particularly in a country that relies on exports. The Japanese, both the government and its overly careful populace, have to finally move out of the managed, fixed currency economy of the past and enter the developed world. (Bloomberg)
- Brazilian waxing has had the unexpected, though logical, benefit of reducing incidence of pubic lice. (Bloomberg)
- Climate change is kicking us in the ass. Congress members may be earning political points (and exposing their own ignorance) by denying it, but the US Global Change Research Program isn’t. (Mother Jones) and here’s the portal for the 170 page report.
- The climate change debate isn’t a debate at all. A list of groups on both “sides” (reality vs. fantasy). The disbelievers are, of course, mostly made up of petroleum and coal producers, construction companies and “The Astroturfing Consortium”. (Big Picture)
- With the attacks in Mali and Algeria, the situation on the African continent gets worse and worse, and will do future economic growth no favors. (Bloomberg)
- Why I should sever my internet connection. Even 3 seconds of interruption at work significantly increases the likelihood of mistakes. (Fiscal Times)
- The deficit is NOT our biggest problem, but screaming calamity 24/7 scores political points for right wingers hell bent on eliminating social and entitlement programs. (Krugman NYT)
- The IMF’s Christine Lagarde lectures the Americans and the Europeans to get their political houses together or the world economic growth will remain stagnant. (NYT)
- Ideology as cognitive bias. It doesn’t pay to be an optimist. (Stumbling and Mumbling)
- Ethiopian kids on the way to becoming autodidacts (self taught), through a healthy dose of free tablet computers, but no teachers. (Africa Report)
Overtaxed America: I really don’t know what to say
A friend sent me this graphic today from the Wall Street Journal which depicts the suffering that Americans experience under the new tax plan.
I saw the “single parent” and thought to myself, “wow, she makes the same amount of money I do” then I noticed the extra zero.
My heart goes out to these people, and to the Wall Street Journal, which is clearly based in a world that I’m wholly unfamiliar with.
It’s tragic, really. You can tell by their faces that they are suffering terribly.
Honestly, as a guy that’s never broken $30K in his lifetime, I can’t adequately express how much rage this is producing.
Today’s Readings 1/17/2013
I just can’t seem to make it to ten, what are y’all reading?
- The problem of gun semantics: exactly what is an “assault weapon”? (NYT) and the former Australian Prime Minister weighs in on his experience in implementing successful gun control following a 1996 massacre. (NYT)
- Fecal transplants (exactly as it sounds) are shown to work to control intestinal infections. There is much we don’t know about the intestinal ecosystem. (NYT)
- A retreat from Afghanistan might call a return to all the problems that got us there in the first place. I often diverge with my liberal comrades on the subject of Afghanistan, the poorest and most fractured country in the world. We were right to go and had much to offer. (Bloomberg)
- Get rid of the debt ceiling now. (Bloomberg)
- Japan cuts its already deficient welfare system even further, amidst greying and growing inequality. (Japan Times)
- Globalization out of control? There’s not as much of it as you may think. Personally, we need more international trade and more connections, not less. (Conversable Economist)
- Our (the US’s) incarceration rates are out of control. At this rate, will all Americans will be incarcerated by the end of the century? (Discourse Net)
- The dark side of big data and surveillance culture. (Fiscal Times)
- The fastest growing economy of the 21st century will be Nigeria. (Quartz)
“Crowded” Vaccine Schedule Deemed Safe….
as one would expect. The Institute of Medicine within the National Academies of Sciences recently produced a 230 page report addressing the concerns of parents that the current recommended vaccine schedule is too “crowded” and thus puts children at excessive risk.
Upon reviewing stakeholder concerns and scientific literature regarding the entire childhood immunization schedule, the IOM committee finds no evidence that the schedule is unsafe. The committee’s review did not reveal an evidence base suggesting that the U.S. childhood immunization schedule is linked to autoimmune diseases, asthma, hypersensitivity, seizures, child developmental disorders, learning or developmental disorders, or attention deficit or disruptive disorders.
Existing mechanisms to detect safety signals — including three major surveillance systems of FDA-approved products maintained by the CDC and a supplemental vaccine safety monitoring initiative by the FDA—provide further confidence that the current childhood immunization schedule is safe.
It’s quite a tempting narrative. Small defenseless children are jabbed multiple times, allowing harmful foreign substances to enter the body, all with the nefarious intent of making profits for large pharma giants. However, children are assaulted by pathogens from the second they exit the birth canal, and continue to be throughout the course of their lives.
The inactivated versions of the pathogens they might otherwise come into contact with should present no extra burden to an immune system that already anticipates invasion. Of course, coming into contact with a dead version of a pathogen is far preferable to coming into contact with the live version. The assertion that the schedule is “crowded”, given daily attacks on the immune system, is completely absurd.
Moreover, the report found that States with loose vaccine policy, have higher incidence of disease, in this case Pertussis:
While parents generally worry about children’s health and well-being, and their concerns about immunization safety can be viewed in that context, delaying or declining vaccination has led to outbreaks of such vaccine-preventable diseases as measles and whooping cough that may jeopardize public health, particularly for people who are under-immunized or who were never immunized. States with policies that make it easy to exempt children from immunizations were associated with a 90 percent higher incidence of whooping cough in 2011.
Of course, we are experiencing record numbers of Pertussis cases. It must be noted, that like influenza, most cases of Pertussis are asymptomatic. In fact, it is estimated that 5 out of 6 cases of Pertussis come without symptoms, yet transmission occurs. (2 out of every 3 influenza cases are asymptomatic. Next time someone tells you they never get the flu, don’t believe them.) Unvaccinated people may still contract the disease, not experience symptoms, and still pass it one to an unvaccinated person, who, of course, could very well die.
Many of the diseases on the vaccine schedule are very much still in circulation. One excellent example is tetanus, a bacteria which lives happily in soil (not rust, as commonly believed). Tetanus passes through our digestive tract regularly through food, but when the bacteria enter the other parts of the body, particularly the low-oxygen environment of the muscles, the usual outcome is to suffer for months and often die a truly horrible death. Nearly all cases of tetanus in the US occur in unvaccinated individuals.
Given tetanus’ ubiquity in the environment, I often scratch my head when parents tell me they don’t vaccinate their children as the risks of the disease far outweigh the risks of the vaccine. Here, of course, it isn’t the vaccine that’s killing kids, but politics and self-serving conspiracy hacks.
Today’s Readings 1/15/2013
This feature may be making me lazy, but I’m short on time. What are you guys reading?
1. A new stimulus package could help jump-start Japan’s moribund economy, but structural reforms are needed for long-term revival.NYT
2. According to the Tunisian President, all dictators in the Mid East/North Africa are doomed to fall.Bloomberg
3. Japan Steps Out: A unorthodox dose of stimulus isn’t new, but signals an important change in a world of crushing austerityNYT
4. Taiwan might be the first Asian country to legalize same sex marriage.IHT
5. Best and worst Japanese films from a number of foreign critics.Midnight Eye
6. Health care costs may be eating into wages.Bloomberg
7. Bernanke speaks at the UM, and the NYT writes better than I do.NYT
8. Filmmaker Oshima Nagisa is dead at 80.Japan Times
9. China’s impact on US inflationFederal Reserve Bank of New York
10. The hidden gains of trade liberalizationVox
11. Tide detergent is now a target for shoplifters, drug dealers and thieves. The NYT has a debate to figure out why. One has to wonder why, in all of the meandering argument, they didn’t just ask the thieves why Tide is attractive. I’m betting it’s being used in the manufacture of drugs.NYT
Ben Bernanke Comes to the University of Michigan
Ben Bernanke, Chairman of the Federal Reserve, came and spoke at the University of Michigan today. Of course, I make sure never to miss an opportunity to check out high ranking government offices ask when they come and speak.
Bernanke addressed what one would expect, fiscal cliff issues, the debt ceiling and the role of the Federal Reserve itself.
The fiscal cliff: He started by reiterating the position that Obama took at his noon press conference. Namely, that Congress has no choice but to approve a raise of the debt ceiling as it has nothing to do with future spending, but rather covers spending that has already been approved by Congress. To not approve an increase in the debt ceiling would lead the US to default of its financial obligations and create chaos in the world economy.
This is, of course, completely true. People are basically suggesting that the government should save money by not paying the light bill. Shutting down the government may sound like a revolutionary affair, but the results would be disastrous, and as the interest on these bills would continue to accrue, we’d just end up losing money in the end.
The role of government in mitigating financial disasters: Bernanke discussed parallels of monetary policy between the Great Depression and the Great Recession, pointing out that efforts to reign in the depression were too cautious and conservative. Government may not do very well in times where the markets do well (since it doesn’t really have to do anything), but has much to do during a financial crisis.
Though a personal observation, the response to the Great Recession was far too conservative. We needed more stimulus, not less and the notoriously slow reaction of The United States Congress held us back in the end. Petty bickering and political brinksmanship shot us in the foot. We’ve certainly seen economic growth since, but unemployment gains have been anemic.
Global economic issues: Though Americans seem to be under the mistaken impression that the united States lives in a bubble, the truth is that we live in an interconnected world. Though the US has seen comparatively impressive gains compared with the rest of the world since the crash, continued problems in Europe and slowed growth in the emerging economies has held us back.
I’m not sure how one gets around China’s slowing pace of growth. Some of that is the result of intentional policy changes to cool down exports in order to create a stronger domestic market there. The Europeans, at the very least, are working to create a unified central bank, which should help mitigate problems in the future. How all the individual political players work this out, will remain to be seen.
Move to require auditing of the Fed: He mentioned the recent movement by House Republicans to require full auditing of the Federal Reserve. Bernanke argued that the Fed is already subject to an independent private sector reviewer. The GAO is also able to examine the Fed’s books and evaluate the inner workings of the at agency. What the GAO cannot do is evaluate specific monetary policy of the Fed. The reason for this, is that the Fed is an independent agency and a unique private-public mixture. If the GAO, or any other government body were able to say, audit and evaluate the implications of raising or lowering interest rates, the Fed would then become less than independent and be subject to the short term political interests of Congress.
Given the batshit nature of this particular Congress, we can be assured that this would result in chaos for the world economy. For proof, one would consider the policy roots of the financial crisis itself. Governments are not incentivized to reign things in when people are profiting. A politically compromised Fed would be even less likely to attempt to control an asset bubble. I’m not sure where I stand on this issue, but an independent central bank is not unique. The Bank of Japan also operates outside the political sphere of the Diet.
I’m pretty sure House Republicans knew all too well that the Senate wouldn’t approve the Bill. They had nothing to lose by signing it.
As Bernanke kept repeating, the “dual mandate” of the Fed is to manage price stability and maximize employment. It can be offered that the Fed, in fact, serves only the interest of the very wealthy. This may certainly be true. It has been my experience, however, that the intentions of policy makers are manifold and often what appears to be self-serving, is actually intended to serve the greater good. Knowing this, I tend to give policy makers the benefit of the doubt and at least listen to what they have to say (rather than have Ron Paul do all the talking for them).
I feel that Bernanke is no exception. I am definitely not stating that I trust him implicitly, or that I think that the policies of the Fed, or any other economic policy, are flawless. On the contrary, the brunt of the financial crisis can be attributed to poor policy making. However, it is irresponsible to disregard agencies such as the Federal Reserve. But it’s worthwhile to hear a man out.
Today’s Readings (Sunday) 1/13/2013
- Male and female mating behavior is more complicated than previously though, challenging notions that human sexual behavior is evolutionarily determined. (NYT) In other news, courtship may be over (NYT)
- Prime Minister Shinzo Abe’s stimulus plan reeks of petty cronyism and cement laden gifts (Noahpinion), but could have the happy benefit of pulling Japan out of its deflationary trap. (NYT) If, however, the $100B stimulus planning is squandered on pointless projects, rather than updating Japan’s creaking infrastructure, the entire experiment could be for naught. (Economist)
- Compartmentalization of the mind could explain why otherwise intelligent people hang on to debunked ideas like climate change denial, Bush-9/11 conspiracies, vaccine/autism links abortion-cancer links, creationism, and birthirism. (Scientific American)
- Gun rhetoric vs. gun facts. Regarding guns, what people state as fact could mostly just be wishful thinking. Of course, this is related to readings 2) above (Fact Check) I’m thinking that I have to do a compilation of all of the great gun related articles that have been coming out. I’ve been impressed at the amount of evidence based discussion.
- The science of why comment trolls suck, and they do. (Mother Jones)
- The Economist agrees that the US debt ceiling is an anachronism and should be abolished. At the very least it would spare us from this yearly round of pointless squabbling. Politicians have plenty of other ways of getting what they want without holding the entire world’s economy hostage. (Economist)
- The world suspends aid to Rwanda, blaming them for a wave of conflict in the neighboring DRC, which could stifle growth in a place where growth is needed. (Economist)
- Ten trends to watch in finance for 2013 (Big Picture)
And that’s good enough for this Sunday. What have y’all got for readings?
Today’s Readings 1/11/2013
1. The latest redefinition of “teacher” and “student.” Now, students are “entrepreneurs.” It is true that we don’t teach enough risk taking to college students. The present bunch, in particular, is quite risk averse. (Bloomberg)
2. Indonesian nurse passes Japan’s nursing certification despite incredible barriers. Japan needs to accept that there is no future in isolation. (Japan Times)
3. Princeton seeks to divest itself from gun companies. Probably easy said than done. There aren’t many publicly traded gun companies, and private equity investment in firearm manufacturers is shady and difficult to assess. Plus, once one goes down this road, defense is next, then pharma, then agra, then a hot of others. I’m about ethical investments, but where does one stop? (Bloomberg)
4. Yep, colonialism was bad for Africa. (Vox)
5. Africa is suffering from an food crisis in that it imports more and more of its food. This needs to change but will require a herculean change is how Africa manages trade. Africa is capable of feeding itself. An end to farm subsidies in the US and gas refining capability on the Continent wouldn’t hurt either. (Vox)
6. Japanese boy hangs himself after being hit repeatedly by his basketball coach. I once saw an autistic boy savagely beaten by a teacher at a Japanese school and heard countless tales of physical abuse by teachers. It’s disgusting that it’s allowed to continue, but it does. (Japan Times) and (Japan Times)
7. Normal people think that economists are either bozos, space aliens, or both. (Noahpinion Blog).
8. Too few women compromise China’s future, or rather, unchanging attitudes that favor men will be the downfall of Asia as a whole. (Bloomberg)
9. Regarding nationalist Shinzo Abe’s stimulus plan, “It will be a bitter irony if a pretty bad guy, with all the wrong motives, ends up doing the right thing economically, while all the good guys fail because they’re too determined to be, well, good guys.” (Japan Times)
Today’s Readings 1/10/2013
1. Economists often use shoddy data. This isn’t really news to people who work with data. Everyone uses shoddy data, since that’s all we have. Pony up some serious cash, we can get some good data. (Slate)
2. Washington is fixing the debt crisis in small increments, because that’s the way things are done in the United States. (Financial Times)
3. AIG, having been bailed out by US taxpayers, threatens to sue, claiming losses, (Washington Post), but it’s not as crazy as you think (CNBC), but it doesn’t matter, because they’re not going to sue after all. (Reuters) I admit, I was fooled.
4. Profit making and health care don’t mix well. (NYT)
5. Complex systems theorists forecast global riots for 2013 because of rising food prices. (Vice)
6. Even Krugman is into this stupid coin idea. Yeah, the one that will be minted with platinum the government already owns anyway (which makes the debt ceiling debate even more preposterous). (NYT)
7. British institution cancels affiliation with Ugandan University over anti-homosexuality stance. (Africa Report)
8. Trying to write a new Zimbabwean constitution while Mugabe is still alive is a futile effort, but they’re trying to anyway. (Africa Report)
9. I can’t figure out who the biggest loser is in the ongoing dispute between China and Japan. Likely, we all lose. (Bloomberg)
10. I didn’t know that American players go to China to play basketball. Looks like one tested positive for weed, even. (Bloomberg)
Defense Spending and the Economy: Is there a link?
Today I encountered a discussion, where the participants emphatically maintained that the current US economic woes are to be blamed in part on increased US defense spending during the Iraq and Afghanistan wars. I countered and claimed that they have no relation at all. Of course, these people hate me now (thinking I was merely being difficult for the same of being difficult), but that’s ok. I’m used to it.
To test this hypothesis, I took data on US GDP (adjusted to constant 2005 dollars) and combined them with data on US defense spending (adjusted to constant 2010 dollars). The results can be seen to the left. The red line is defense spending. The blue line is GDP.
As I maintained, there is no obvious relationship between defense spending and economic growth. There are a couple of major blips in GDP growth, namely the collapsing of tech equities in the early 2000’s and the economic meltdown on 2007/8. There are no events in US GDP for drops during Clinton nor sudden increases in defense spending following 9/11.
In fact, as defense spending dropped pre-9/11, you can see the US economy was plugging along just fine. As defense spending went up post 9/11, the US economy maintained the same trajectory, minus the economic bumps.
Certainly, GDP is not the only economic marker we could use. I did the same thing with the unemployment rate.
Now, at first glance, this is a little more convincing. But when you take the events into consideration, it is less so. The two major economic events of the 2000’s, namely the equity bust, and the financial meltdown both resulted in sudden jumps in the unemployment rate. 9/11 and the troop surge did not. In fact, as spending was doing up, unemployment was going down. If we look back into the nineties, we can notice that even though defense spending was declining, unemployment was up, then down again. In short, given the context, there is no real reason to assume that two related.
I am NOT an advocate for war. I am though, an advocate for evidence backed claims. There is little evidence to suggest that increased defense expenditures during the Bush years affected our economy.
We can claim, if we like, that federal revenues might have been greater had the wars not happened. These revenues, it is argued, could have been allocated to education or infrastructure improvements, for example. However, it has to be noted that the wars weren’t funded out of federal revenues. They were funded out of low interest bonds. Thus, as those bonds had not been serviced at the time that this data was collected, there is, again, even less reason to assume that the wars negatively impacted the economy.
Now, we can certainly make arguments over how much defense spending is too much and what the potential long term effects of servicing the war debt will be. I argue, though, that our elected representatives are much more interested in financing the military than, say, welfare programs for the needy. It would take a great leap of faith to assume that, if the military were closed tomorrow, monies targeted for defense would automatically be transferred to providing health care to poor people. I also argue that, long term, the expenditures that came out of the financial crisis will be, in comparison, more difficult to service.
The war cost us politically, but was a bargain economically. To me, that’s a much more frightening state of affairs.