If you want to live with old infrastructure...

you better be a bunch of compulsive maintenance freaks.

Jus' sayin'!

The Interstate 5 Bridge over the Skagit River in Washington state collapsed around 7 p.m. on Thursday, dumping cars and people into the water.



This, folks, is embarrassing.

Why cap-and-trade is failing in the E.U.

As regular readers know, I think cap and trade is a stupendously bad idea.  I have brought this up before.  Here are two recent examples.

• April 4, 2013  Cap-and-trade is still a bad idea
• April 19, 2013 Selling indulgences for carbon emissions does not work

So I take some pleasure in finding someone else who has reached similar conclusion even though coming from a different place.  In this case, we are talking about a man who has been studying how the E.U. sets its agenda.  According to Cronin, cap-and-trade is a favored scheme in the governments and bureaucracies of Europe because Big Oil and the moneychangers want it.  Big oil likes it because it lets them operate their businesses unchanged while guys like Goldman Sachs and their traders see it as merely something else to profit from.  The fact that it does not reduce CO2 one little bit seems to be a problem about which they care little.

The EU's Scheme

Climate Policies Must Break Free From Big Oil

by DAVID CRONIN  MAY 22, 2013

It seems an odd time for environment policy wonks to throw a party. The level of carbon dioxide in the earth’s atmosphere is higher than it has been in three million years, according to the National Oceanic and Atmospheric Administration in the US.

That sobering news hasn’t stopped the organisers of Carbon Expo in Barcelona from promising a celebration when the annual event is held for the tenth time at the end of this month. Ardent defenders of the polar ice caps like Shell and Statoil will spend the day gazing at mathematical models about the ideal price of pollution. After all those cerebral chinwags, they will surely have worked up an appetite for tapas and sangria.

On second thoughts, maybe it is apt for the oil industry and its chums in the world of finance to kick up the high life as the climate breaks down. For they have been dexterous enough both to cause that breakdown and to present themselves as the cure to it.

The big “green” story here in Brussels lately hasn’t been the perilous state of the planet but the problems befalling the EU’s emissions trading scheme. Although the scheme has proven to be disastrous in terms of mitigating climate change, it has helped entrench the idea that heat-trapping gases should be considered as a tradable commodity. Because there are people out there who stand to make millions from carbon transactions, it’s not surprising that they want to salvage the Union’s scheme.

The International Emissions Trading Association (IETA) is arguing that the scheme “should remain the EU’s central climate policy instrument.” In fact, it’s so gung-ho in its support for this market-based mechanism that it is advocating that similar systems should be established as a result of global talks.

Among IETA’s members are Goldman Sachs, JP Morgan, Shell, BP and Total. I seem to recall that the first two villains helped to cause a global financial crisis and that the latter three sell fossil fuels, the principal source of carbon dioxide in our skies. Are they really in a strong position to decide what should be the “central” policies on climate change?

Unfortunately, they are. The prototype of the EU’s emissions trading scheme, as it happens, was developed by BP. While he was still chairman of that firm, Peter Sutherland, was hired as an adviser on climate on energy to the European Commission’s chief José Manuel Barroso during the early stages of the scheme’s implementation. It is an “instrument” both designed by fat-cats and played with the intention of pleasing them.

The agenda for the Carbon Expo boasts a session titled “learning from the legends.” The “legends” referred to here are emissions trading and the international Clean Development Mechanism (CDM) that it supports.

Is this supposed to be a joke?

One of the most disgusting aspects of the EU’s climate change policies is that they rely largely on “offsetting.” Under this dubious concept, it is fine for power plants on this continent to belch out as much pollution as they want, provided some money is given to environmentally-friendly projects in poorer countries. This is akin to buying a nice present for your friend who has given up smoking instead of you.

Rules applying to the EU’s scheme allow for up to half of all emission “cuts” financed by it to be achieved via the CDM. Newly published data from the European Commission indicates that this form of offsetting is on the increase. In 2012, offsets accounted for one-third of the “compliance commitments” made by firms taking part in the trading scheme, compared to 13% the previous year.

Many of the projects being funded are anything but clean. A “high-level panel” overseeing the CDM – which includes a European Commission representative, as well as ministers from Japan and South Africa – published an assessment on its performance last year. The report warned that the CDM could lead to a “net increase” in global emissions of greenhouse gases. It suggested that the mechanism is being widely used to support coal-fired projects, particularly in India and China. Energy efficiency has been “almost entirely left out” of the CDM, the report added.

In a few weeks time, members of the European Parliament will decide whether or not they should endorse the continuation of the emissions trading scheme. The best thing our elected representatives could do is to bury the scheme. Trying to revive it would be irresponsible.

There is a salutary lesson here. Saving the planet requires what Americans call “big government,” not a dodgy market mechanism.

There is an urgent need to go back to the drawing board, not to tinker with a system fashioned by BP.

Fortunately, there are sensible policies being followed in parts of Europe. Germany has increased the share of renewables in its energy mix from 6% to 25% over a decade. A law guaranteeing priority to the grid for renewable energy has provided the incentive for this rise. Local communities have been able to break free from relying on oil giants.

This breakthrough means that emission cuts can be achieved on European soil, rather than exporting our pollution control problems to somewhere else. It is telling that this breakthrough has had nothing to do with emissions trading.

If the EU keeps doing the same thing, it will keep getting the same results. This approach might prove fruitful for Goldman Sachs and BP. But it won’t stop the earth burning. more

Wagner—on his 200th birthday

When I was singing with the Minnesota Bach Society, we were asked to provide the chorus for a symphonic performance of Wagner's Tannhäuser with the Minnesota Orchestra.  To be perfectly honest, I was not exactly thrilled about this.  I had signed up to sing the delicate polyphonic melodies of Bach—not the heavy and oh-so-serious operas of Wagner.  Not surprisingly, I discovered that singing Wagner was a real hoot and Tannhäuser was not the endurance contest of the Ring Cycle.  I also discovered that there are SERIOUS Wagner fans. I am still mainly a Bach fan, but I have read some of the scholarship, seen the Festspielhaus in Bayreuth, and visited the Herrenchiemsee—one of the more lavish palaces of Ludwig II, Wagner's main patron—in an attempt to understand what all the fuss is about.

Wagner's politics have been discussed in minutest detail over the years—mostly because one of his biggest fans was Hitler.  This is probably a mistake because as I have discovered in life, outside of music it's probably a bad idea to discuss any other subject with a musician.  The reason is simple—music is such a complex subject and requires so much practice in order to do well, anyone who gets good at music hasn't had a lot of time to master much else.  When the musician is Wagner, the music itself is so complicated, discussions of his politics is usually just a distraction for those who cannot or will not deal with the complexities of his music.

Me?  I intend to celebrate the occasion by listening to Tannhäuser one more time and wonder again if the mere act of asserting that the essence of love is lust is such a serious crime, it requires acts of redemption.  Really?

Who was Wagner? On the composer's 200th birthday

The poet, director, conductor, author and, most importantly, composer, born on May 22, 1813 in Leipzig, remains a riddle to many. Two hundred years after his birth, the debate goes on.

DW.DE 22 MAY 13

More has been written about him, it's often said, than about anyone else in history apart from Jesus Christ and Napoleon Bonaparte. Two hundred years after his birth, Richard Wagner is a much-discussed subject. Some see him as the genius who created the "total work of art." Others reject him for his anti-Semitic writings. In any event, his operas are performed today more often than ever before.

He came from a middle-class family. The father, Carl Friedrich Wagner, was a police actuary; his mother, Johanna Rosine Pätz-Wagner, a baker's daughter. The boy, baptized Wilhelm Richard Wagner, was interested in theater from early childhood.

Music of the future

Initially he wanted to be a poet and playwright. But seeing Beethoven's opera "Fidelio" at age 16 resulted in a change of career plans: He decided to be a composer. As early as 1831, as a student of music, he planned his first opera, for which he penned the text himself - an approach he was to take for the rest of his life.

By 20, Wagner was directing the Theater in Magdeburg. There he fell in love with the actress Minna Planer. They married in 1836 and had no children. Riga and Paris were the next stations in the life of the itinerant artist, who was plagued by financial worries and pursued by creditors.

The Wagners lived in Paris under dire circumstances, yet he was able to complete his early operas "Rienzi" and "The Flying Dutchman" there. His interest in the leftist revolutionary currents of the era dates from that time.

In 1842, Wagner moved to Dresden, where he became court composer. In October came a musical breakthrough: the premiere of "Rienzi." Always working on various works simultaneously, he began to develop the vision of a new blend of words, music and action into a "total work of art." The goal: nothing less than "the unconditional, immediate depiction of human nature in a state of completion."

Deus ex Machina

In a recent interview with DW, his great-granddaughter Katharina Wagner put it in these words: "In Wagner's works in particular, it's all about the basic elements of human existence and of basic qualities like jealousy, power, love, and hate. Those are of course things that will always be timely and move us as long as humanity exists."

In May 1849, the composer participated in a grass-roots rebellion in Dresden, after which he became a wanted man and was forced to leave Germany. Then in 1864 - back in Germany and in despair and financial straits - he was close to suicide. At that point a letter from the new King of Bavaria, 18-year-old Ludwig II., arrived. The king offered his full support and continued to do so for the rest of Wagner's life.

In the little Bavarian town of Bayreuth, Wagner eventually found the location for his vision. Far from the bustle of big-city life, in a self-designed festival theater, audiences were able to concentrate totally on the combination of music, stage action and scenery. That happened for the first time in August 1876 at the premiere of Wagner's four-opera cycle, "The Ring of the Nibelung."After many affairs before and after the death of his wife Minna, Wagner lived in Tribschen, near Lucerne, with Cosima von Bülow, daughter of Franz Liszt and wife of the conductor Hans von Bülow, one of his friends and promoters. Three children were born before the couple finally married.

The first Bayreuth Festival was a financial disaster and an artistic fiasco, yet Wagner was able to stage the second edition in 1882. Only a single work was performed then, his final one, "Parsifal." He died on February 13, 1883 in Venice.

What does Wagner stand for?

Was he a socialist? A National Socialist? How are his wide-ranging writings to be interpreted? Nearly every statement made by the composer seems to be contradicted somewhere else. What is the message of the music? Does it, like some of his writings, contain elements of anti-Semitism?Why the fascination with Wagner still today? One of the most influential composers ever, his late-Romantic music has always had an emotionally stimulating quality. Most people react either with rejection or enthusiasm; few are indifferent. Wagner's goal was to revolutionize theater and opera, but he became ensnared in a political revolution and later identified with ultra-nationalistic Germanism.

What did Wagner advocate? In the final analysis: himself. "Networker" and "self-promoter" can be added to the descriptions of the multi-talent, who forced his art onto a world that didn't want it. Today, however, the world is grateful.The debate goes on, but for conductor Christian Thielemann, there is no debate. "You can't politicize music," he told DW. "It's always been a big misunderstanding. And a choice of tempo in 'The Mastersingers of Nuremberg' has nothing to do with politics. You have to perform it for the sake of the work. If you approach it with some sort of intention, it's a shame, or completely wrong." more

This time I won't wag my finger

"How do you stop people who will stop at nothing?"

For me, this was the most interesting question from the 2008 film Battle in Seattle about the 1999 anti-WTO protest that successfully halted (for a few minutes) the forces of globalization.  Now Chris Hedges addresses the same problem.  This is a man who once had a platform at the New York Times.  He was someone who actually had a little influence in a world where almost no one has any.  He looks at the plans the bad guys have for the rest of us and comes to the conclusion that we must either "rise up or die."

As a practical matter, the interesting question must be, "Rise up to do what?"  I have been trying to answer this question for almost 30 years and trust me on this, there are NO easy answers and all the useful ones absolutely require conditions of peace to implement.  So I am not one to beat the drum of revolution.  I am in agreement with John Lennon who wrote in Revolution that  he wanted "to see the plan" from those advocating toppling the system.  So I have spent my adult life looking for a plan that would have at least a minimal chance of success of actually improving the human condition.

Even though I believe I have found most of the elements for a good post-revolutionary plan based on a combination of historical research and an enduring belief in the powers of human innovation, I am a LONG way from signing on to any change scheme that involves explosions (no matter how pleasant it may be to contemplate the head of Lloyd Blankfein on a pike.)  Even so, I am also a long way from condemning Hedges for his call for a revolution.  There have been a bunch of bad guys in history but the crowd destroying the planet these days makes even guys like Genghis Khan look pretty harmless.  If Hedges can slow down these evildoers, more power to him.

Electrical storage alternatives

Outside of discovering new and more efficient ways to move green power around, the holy grail of renewables is storage.  And in some ways, I am not convinced the storage problem will ever be solved.  In fact, I am more or less convinced that with renewables, we must "make hay while the sun shines."  In other words, we use the energy when it is available and get along without when it is not.  Of course, this unreliability is pretty much what doomed sailing except for fun.  It is obvious that given a choice between an intermittent power source and a reliable one, folks will chose reliability in a heartbeat.

So no matter how unpromising, folks will pursue electrical storage because it will most certainly have a ready market if anyone actually makes some scheme work.  So with another hat tip to K. Fathi, here is a damn good look at the various storage technologies and a guess at how likely any of them are to succeed.

Penny Pritzker as an example of the criminality of our elites

Le secret des grandes fortunes sans cause apparente est un crime
oublié, parce qu' il a été proprement fait." - Honoré de Balzac, Le Père Goriot

"The secret of a great success for which you are at a loss to account is a crime that has never been found out, because it was properly executed," more dramatically rendered in English as "Behind every great fortune lies a great crime."

President Obama is nominating his top fund raiser, Penny Pritzker, to be Secretary of Commerce. Incredibly - perhaps I should write, sadly - the announcement is causing hardly a stir among the liberal and progressive blogosphere. At the very least, Greg Palast's May 4, 2013 post at Smirking Chimp, Billionaire Bankster Breaks into Obama’s Cabinet,  should be going viral. Palast wrote:

Pritzker’s net worth is listed in Forbes as $1.8 billion, which is one hell of a heavy magic wand in the world of politics. Her wand would have been heavier, and her net worth higher, except that in 2001, the federal government fined her and her family $460 million for the predatory, deceitful, racist tactics and practices of Superior, the bank-and-loan-shark operation she ran on the South Side of Chicago.

Superior was the first of the deregulated go-go banks to go bust – at the time, the costliest failure ever. US taxpayers lost nearly half a billion dollars. Superior’s depositors lost millions and poor folk in Sen. Obama’s South Side district lost their homes.

There were also a couple diaries on DailyKos, including by front pager Laura Clawson, who called attention to Pritzker's and her family's role in Hyatt Hotels, which has compiled what may be the worst records of labor abuses in the hotel industry. Incredibly, just to prove, I suppose, how hopelessly uninformed, ignorant, and unaware liberals and progressives can be, someone posted in one of the first comments, "She's not the monster you think she is."

Even President Obama rushed to show that he was likewise uninformed, ignorant, and unaware, though at this point I'm not about to attach the labels "liberal" or "progressive" to him. 

"She's built companies from the ground up," Obama said. "She knows from experience that no government program alone can take the place of a great entrepreneur."

There once were, in most every city, old labor and socialist organizers, veterans of the labor strife of the 1920s and 1930s, you could sit down with in a neighborhood tavern, and during the course of an evening, well lubricated by a few pitchers of beer, tell you more than you really wanted to know about who was actually running your town. How the police chief's kids got really good paying jobs because the chief would not make too many inquiries about (in other words, would remain deliberately uninformed, ignorant, and unaware) the prostitution on the West Side; or the numbers racket along the riverfront; or the freight pilferage at the airport. How the mayor's wife was able to drive around in a brand new Cadillac because a certain tract of land had been quietly rezoned, to the advantage a mayoral crony. Such petty corruption used to be the stock in trade of good local investigative reporters at big metropolitan newspapers, back in a nearly forgotten era when FCC rules made it nearly impossible for one or two corporate behemoths to own every major newspaper, radio station, and television station in one city.

Many of you already know that I used to be an economics correspondent, and that I burned out and became depressed watching Wall Street have its way in the early 1990s in what was called, back then, "off balance sheet liabilities" (what we today call "financial derivatives" - the stuff, like credit default swaps, that blew up in 2007 through 2008, and left a dismaying amount of the world's economy in ashes). Well, that's not really the whole truth. About what got me depressed, that is. So, tonight, you're going to learn a bit more of the truth. You're going to learn some of the dark, frightful secrets hidden away in my memory; stuff I usually don't mention, because it makes a lot of people very uncomfortable. 

In a word, the mob. Organized crime. The syndicate. In Chicago, it was called the Outfit. But every major city had its own crime family, or branch thereof. You see, part of what I researched and wrote about in that depressing period of nearly a quarter century ago was how the billions of dollars, nay, hundreds of billions of dollars that were fueling what was politely called mergers and acquisitions, most especially including leveraged buy outs, came from, not entirely, but in large part, organized crime. That included hundreds of billions of dollars that the Wall Street banks laundered from illegal narcotics trafficking, including heroin and cocaine.  The beginnings of financial derivatives were closely tied to the mob going legit.

So, the Reagan regime of deregulation was really a double whammy. It basically decriminalized the worst behavior of banks and corporations, at the very time that some of the most immoral, ruthless, indeed murderous, people in America were buying legitimacy for themselves and their heirs by seizing control, through brazen manipulation of debt and stock markets, of America's industrial companies.

The story of the hour is Penny Pritzker becoming Secretary of Commerce. So, tonight, you're going to learn about the Pritizker family and its fortune. I suspect that it's probably more than you want to know.

The origins of the Pritzker family fortune was her grandfather's mob connections when he was a tax attorney for a lot of people in "The Outfit," the Chicago mob, beginning under Al Capone, and continuing through the 1980s. This connection to organized crime was reportedly what financed the creation of Hyatt Hotels by Penny's father. There was no crime involved, but the financial backing came from organized crime, plain and simple.  The details are in Gus Russo's 2006 tome Supermob: How Sidney Korshak and His Criminal Associates Became America's Hidden Power Brokers. Russo's book is crucial reading for anyone trying to understand why America's ruling elites are, well, so bad. It's not really a matter of incompetence or ineptitude. Rather, it is a case study in how the republican (small "r", not capital "R" as in the Republican Party, or GOP - greedy old pricks) ideals of public virtue, the general welfare, and economic and political equality, are forgotten and eventually undermined by allowing a criminal class to become legitimate and amass political and economic influence. The story of the Pritzker family is an all-American story, of how a family with ties to organized crime amasses a great fortune while striving relentlessly for legitimacy, and arrives at the pinnacle of economic and political power in America. Chris Hedges is not exaggerating when he states that "the criminal class in this country has seized power."

This ascent to America's summits is an oft-trod trek, pioneered by Boston and Newport maritime merchants who parlayed opium and millions of ruined lives in China into wealth, respectability, and power in the 1800s. Many of the mercantile banks established along the way are still with us, brightened and prettified by numerous changes in corporate branding. The one constant is the ruthless concentration on private gain. The extent to which that concentration on private gain is tempered and ameliorated by fleeting notions of public service provides the cracks and crevices in which the ebb and flow of history eddy and swirl. 

Now, you can point to the Kennedy family as an example of ill-begotten gains leading to some very good minded public service. But Penny Pritzker's roles at Hyatt and Superior Bank are, to say the least, highly troubling, and cast doubt on the idea that she may be anywhere near as mindful of the general welfare as John, Bobby, and Edward Kennedy were. Instead of public service, the tradition in the Pritzker family seems focused on economic exploitation of others, skirting the law as much as possible, and shady dealings. There is a strong tradition in the Pritzker family of outright money laundering and offshore tax evasion.

Japan—here we go

The news out of Japan is not surprising to anyone remotely interested in the economics of development.  Just remember, the great outburst of development economics here in USA was most embraced (some say invented) by those closest to the frontiers where folks were attempting to turn virgin soils into farms and towns.  The only state bank is in North Dakota.  The People's Party was formed in Omaha.  Thorstein Veblen grew up in Minnesota the son of an actual pioneer.  Our people have been thinking about the economics of development since at least 1873 so we have a pretty clear-eyed view of what works under adverse conditions.  And since Abenomics is a more or less an A+ incarnation of everything we believe about how societies grow and prosper, it's not surprising it's beginning to succeed.  We are usually right about these things.

Of course, just because Abenomics is off to a rollicking start does not mean it will be a long-term success.  The most important factor will be just how long the Japanese are willing to stick to their expansionary plans.  Here in USA, we have a perfect cautionary take.  FDR began his Keynesian expansion in 1933 but lost his nerve in 1937 when he started listening to the budget-balancing devils in his head.  It only took a few months before the nasty Depression had returned and would continue until USA started gearing up its war machine in advance of its entry into WW II (1941).  Only when FDR became consumed with war fever did his government approve of a Keynesian stimulus large enough finally end the Great Depression.

What is especially interesting about the following article from Business Insider is that it relies on what in the old days was that most trusted of economic indicators—machine tool orders.  I am certain Tony would approve—I know I do.

Saturday toons 18 MAY 13

Climate change and Peak Oil—the evidence is overwhelming

One of the main reasons why I have such a short fuse around folks who deny Climate Change or Peak Oil and then expect you to treat them seriously is that I never know whether they are just incredibly lazy or hopelessly ignorant—and neither trait is especially flattering.  The science that backs both concepts is not only overwhelming, but is especially easy to understand—we're not talking about the "holes" that migrate through semi-conductors or dark matter, after all.

I remember my first impressions of Marion King Hubbert and his descriptions of the life cycle of oil fields writ large he called Peak Oil.  I mean, not only did the guy have a name one could easily associate with the awl bidnuss, his descriptions of the yield curve sounded like the sort of thing all the oil guys I had ever known would say.  So I have been waiting for a real oil guy to come to Hubbert's defense.  Thanks to K. Fathi, I just read a good one.  It is a pretty clear description of the frustrations encountered by the Producer Class subset of the oil industry when trying to describe their reality to an "investment strategist."

Following that we have a study that counts up the percentage of peer-reviewed science papers on Climate Change.  Spoiler alert: Of more than 4,000 academic papers published over 20 years, 97.1% agreed that climate change is anthropogenic.  What makes this article especially interesting is that it speculates about a world where even 97% scientific agreement won't change a lot of minds—especially in the general public where the issues have become so muddied—and suggests that efforts be concentrated on working the decision-making elites.

Solar has definitely arrived

Over the years, there have been thousands of community-activist types who have marched and demonstrated in favor of using solar power.  What is ironic about this sort of activism is that the serious advances in the solar-collecting art were accomplished by boring nerds who went to work in their labs every day trying to extract tiny amounts more efficiency from their cells, and their pals in production technologies who took successful lab experiments and turned them into reliable consumer products.  At least 99% of the success in solar is due to the good work habits of the Producing Classes.

I point this out because even though solar is still in many ways an infant industry, it has matured enough to compete head to head some dirty old stalwarts like coal.  Yes, even coal with its 200 year head start.  And as the technology matures, people are just beginning to understand the economic implications of a technology that you put out on the lawn or up on a roof and it provides useable energy.  To say this is a game-changer is to court the outer limits of understatement.

Rev. Dr. William Barber NC NAACP demands: WHERE ARE YOU NOW?

Rev. Dr. William J. Barber, II, President of the North Caroline NAACP, speaking at Martin Street Baptist Church, Raleigh, NC, Tuesday evening, May 7, 2013.



The past two election cycles have been political catastrophe in North Carolina. In 2010, Republicans won control of both houses of the state legislature and got very, very busy, preparing to seize total control of the state in 2012. Which they did. State legislative and state senate and U.S. Congressional districts were wildly gerrymandered, with the result that last year, though nearly half a million more Democrats than Republicans voted, the Greedy Old Pricks party won even larger majorities in the state House and Senate, took the governorship, and won seven of 10 seats in the U.S. Congress. The new Speaker of the North Carolina House, Thom Tillis, is a national board member of ALEC, and former Rep. Fred Steen, the past state ALEC chairman, is now Gov. Pat McCrory’s legislative lobbyist.

The legislation introduced and passed by the Republicans has been stunningly swift and breathtakingly awful, and all based on ALEC templates. Unemployment benefits have been cut back to among the stingiest in the nation. Funding for pre-school education has been slashed.  Private school vouchers have been enacted. College students who dare to register where they go to college are having their parents penalized to the tune of $2,500 by the Republicans legislating that such students are no longer dependents, and cannot be claimed as a dependent on parents' state income taxes. A voter ID law is in the works that is so draconian that even some Republicans are warning it needs to be changed. Just a week or two ago, the Republicans introduced legislation to make it illegal for anyone to sell a Tesla, the hot-new all-electric car that was named Car of the Year by Motor Trend magazine, except through an in-state Tesla dealership – of which there are exactly zero. (One of the GOP leaders is the legislature own a few car dealerships.)

Their blockbuster effort is to abolish the state income tax, and replace it with a state sales tax. Including on food and medicine. In other words, outlaw any semblance of a progressive tax system, and impose one that totally favors the rich at the expense of the poor.

The agenda of North Carolina Republicans is so extreme, and the pain being imposed on the poor and disadvantaged so overwhelming, that the first sparks of civil disobedience have been ignited. Under the leadership of North Carolina NAACP president Rev. Dr. William J. Barber II, about 100 to 200 protestors have congregated in the halls of the General Assembly on each of the past three Monday afternoons, with about a score arrested each time. They have used the methods  of non-violent resistance during their protests and arrests, and teams of supporters, including lawyers, have stood vigil each time until bond was set and the protestors released. At around four in the morning, each time.

Rev. Dr. Barber is calling this Moral Monday, and he is about to begin a speaking tour of twenty other counties in the state, to begin organizing similar resistance. In his speech on the Tuesday after last week’s Moral Monday, Rev. Dr. Barber laid down the gauntlet to our conservative brothers and sisters of faith.

Watching Japan

Japan's economic experiment is barely under way and already the self-annointed experts are passing judgement.  Part of the problem is that for those steeped in the conventional wisdom, no country would actually TRY to drive down the exchange value of its currency.  Must be to please their exporters, muse the wags.

Yes, the declining Yen has made a lot of currency dealers rich—with no risk because the Bank of Japan told everyone what they intended to do well ahead of time.  Yes, I am sure that the exporters are delighted the Yen is back above 100 to the dollar.  And yes, the Nikkei is back above 15,000 so those who believe this is the only metric worth taking seriously are happy.  But as I see it, this is merely the sideshow to the big event—Japan intends to get into the business of massive infrastructure upgrades and they intend to issue the funds rather than issuing new debt.  The spirits of Edison and Ford are dancing with delight.  Yes!  Precisely!

And in the meantime, just the suggestion that Japan has changed course is spilling over into the economic debates in Europe.  Stay tuned—this could get very interesting.

Inflation—the official threat of the "conventional wisdom"

When the only tool you have is a hammer, pretty soon everything begins to look like a nail. 

I first heard this little gem of wisdom from an orderly who worked in the emergency room of this sprawling teaching hospital attached to the University of Minnesota.  Because this mega-university came with a labor pool, over-educated orderlies were pretty common.  I believe my friend was a philosophy major.  He was commenting on the difference between the medical subspecialties and how they handled trauma.  He was warning me that we might have more business than usual in the OR because the surgeons were staffing the ER that night.

Over the years I have heard this line from many sources—it's actually something of a Producer Class favorite.  And it most certainly describes the economics profession as embodied in Rogoff and Reinhardt.  The neoliberals owe their triumph to their victory over those soft-on-inflation Keynesians.  And when they staged their intellectual coup d' etat in the 1970s, one's credentials were determined by how harsh you were willing to be to fight inflation.

Four decades later, and the moonie-like babbling about inflation can been seen in the comments threads about inflation on economic sites like Business Insider.  In the face of an 1930s-style economic calamity, everybody still mouths the same platitudes about the evils of an expansionist monetary strategy.  In their world, Bernanke and his program of quantitative easing will lead to the hyper-inflation of Zimbabwe.  They just KNOW that Japan's cheaper Yen strategy will fail because they also KNOW that no sane person would EVER want a cheaper currency.  I don't know what it is called, but these folks are singing lustily from the same songbook.  Not surprising since they probably came of age when the job definition of the world's central banks had been reduced to the enforcement of price stability.

Only one problem—there is no inflation.  Deflation is the problem.  And those economists who believe that inflation is the greatest threat to civilization they can imagine, may soon discover that they have the wrong tools to understand the real economy.  And if they made the serious mistake of believing inflation is the ONLY economic problem worth being concerned about, they must either relearn their profession or be utterly obsolete for the next 40 years.

Climate change and agriculture

Last summer taught me how fragile agricultural production really is.  Watching nearly the whole Corn Belt go from potential record crops to staggering losses in just a few weeks was pretty damn scary.  And while I usually don't approve of apocalyptic predictions for climate change, the one where someone predicts that agriculture could fail on an entire continent doesn't seem so very far-fatched.

The new Gilded Age rules

Bill Maher took some time to remind his viewers (at 3:02) on the occasion of the release of a new "Great Gatsby" just how wildly skewed the income distribution in USA has become and how angry and desperate that makes those on the bottom.  His token right wing guest is caught looking quite distressed.

Selling our children into slavery

There are few places on planet earth where the young are not royally screwed.  50% unemployment rates are fairly common.  But very few places rival good old USA for the evil treatment of their children.

Case in point—education.  In places like Minnesota, middle and high school education is well-funded and quite luxurious.  There are dozens of organized activities devoted towards personal enrichment.  Athletic teams often travel in coach-type buses.  In the town where I last lived, the high school had an enormous arts wing that included practice rooms, a theater, and a video editing complex that had two dozen Final Cut Pro editing suites.  In spite of the built-in trauma of being 15, these years may be the most comfortable and stimulating of many student's lives.  Unfortunately, while high school like this can be a lot of fun, the students graduate knowing FAR less of anything as academically rigorous as their grandparents had to know to graduate the eighth grade.

No problem.  They can all just go to college.  Nice plan but college can cost upwards of $50,000 a year.  Who can afford that?  Well, almost no one but hey, there is always the trip to the friendly arms of the moneychangers.  And so to get the education they should have gotten in high school, they go into massive debt.  And not just any debt, mind you, but debt that can never be discharged with bankruptcy.  Kids who simply want to obtain the skills they need to survive in today's society must sell themselves into debt slavery to get them.

And while our banks can borrow at nearly 0% interest, the poor, overwhelmed students must pay something close to the rates for consumer debt.  The government has been subsidizing the rate to keep it at 3.4% but the rates are set to double to 6.8% July 1st.  Elizabeth Warren seems to think that student loan interest rates should be closer to .75%.  She isn't about to address the naked rip-off of the young by an education business that charges $50k / year for a mostly worthless diploma, but at least she understands the concept of usury.



Here, Assif Mondvi looks at what students are actually getting for their high-priced educations and suggests that kids would be much better off staying out of school, seeking more practical alternatives, and not selling themselves into debt bondage.  For something out of a comedy show, this is intense and powerful.

The Daily Show with Jon Stewart
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Saturday toons 11 MAY 13

Iowa invests in more wind

Regular readers know that of all the forms of green energy, wind is by far my favorite.  I spent part of my childhood in NW North Dakota.  I really need no further excuse.  But I have one.  I learned how to sail in my 20s and grew to truly love it.  It is a fascinating subject with a vast literature because for most of recorded human history, sailing was the best way to get around—by far.  The people who went to sea funded an astonishing amount of scientific and technological research.  And at the very center of all this heavy thinking was question #1: How do we harness the power in the wind?

At the height of their powers, the sailors had figured out the glorious clipper ships.  Make no mistake, being a sailor was a cruel and hazardous life but when those clippers were pushing forward at 22 knots, it was also one of the great rushes known to human experience.  Just remember, sailors these days do it for fun!  Humanity actually has quite a bit of experience using the wind.

Iowa may seem an odd place to find wind enthusiasts—being about as far from the seas as is humanly possible.  But it actually makes a lot of sense.  Iowa's population includes a bunch of Hollanders (plus plenty of Nordics.)  Ever since Rembrandt made a practice of including in his paintings the windmills that powered much of the prosperity of the Dutch Republic, this is a clan that understands the issues of wind power in their bones.  It's deeply cultural—almost religious.

Iowa is also a welcome place for really smart folks.  Their luminaries include James van Allen and Norman Borlaug.  James Hansen, the finest mind in climate science was a small-town Iowa boy.  Robert Noyce, the genius behind integrated circuits learned everything important growing up on the campus at Grinnell.  The reason this is important is that working with wind is a difficult problem precisely because it doesn't blow all the time.  Powering a society designed to run whenever the switch is thrown with a variable power source is probably not impossible, but it will be damn difficult.  Nice to have smart folks around who actually enjoy solving hard problems.

Iowa's wind position is not like North Dakota's, but it has plenty of good wind sites.  Even better, Iowa has a capital city in Des Moines, but it doesn't really have a central city.  Instead, there are medium-sized cities distributed throughout the state.  This is an open invitation for a technology that works better if the collected energy doesn't have to be shipped very far.  Oh and then there's that little matter of once you invest in the technology, the fuel is free.

What extra charming about this article is how excited Iowa folks are over a $1.9 billion project.  On Wall Street, this isn't even a rounding error.  In Iowa it's a big deal.