Floyd Norris documents the latest outrage, that Goldman Sach is looking at buying tax credits from Fannie Mae.
The idea here is that Fannie Mae is losing money, and is federally owned now, so it can’t use the tax credits, so it sells them to GS for something like 80¢ on the dollar, screwing the taxpayer.
Goldman, you may recall, was saved with taxpayer money when the panic spread last year. A naïve person might think such a company would see a patriotic virtue in paying taxes.
Fannie Mae is currently a ward of the government. So this boils down to a proposal to pay Uncle Sam perhaps 15 cents to avoid paying 20 cents to Uncle Sam. The gall involved in even proposing such a thing is awesome.
It also points out one reason companies pay so little in taxes. These tax credits exist as a nonbudgetary way of stimulating investment in low-income housing. It would be a lot cheaper for the government to simply subsidize that, but instead it offers tax credits so there is no “expenditure” for foes of big government to criticize.
Seriously, we need someone to move in and break heads, but the Obama/Geithner/Summers troika has no interest in challenging the excesses of Wall Street.
I’ll just quote his last ‘graph:
If the Democrats lose badly in the midterms, the talking heads will say that Mr. Obama tried to do too much, this is a center-right nation, and so on. But the truth is that Mr. Obama put his agenda at risk by doing too little. The fateful decision, early this year, to go for economic half-measures may haunt Democrats for years to come.
Actually, I am not entirely sure that this is true. There is a pat of me that believes that Obama’s agenda has always been very minimalist.
Just read the whole thing.
Jane Hamshire has a rundown of Rahm Emanuel’s history, and it shows that now only is he on the wrong side of every issue on the merits, he also creates political disasters for the party.
It is very good reading, where she shows that he was on the wrong side of NAFTA, the Iraq war, healthcare, etc.
The money quote is:
Rahm doesn’t think about Democratic turnout. His reputation for “winning a Democratic majority” rests on his ability as a self-promoter to take credit for victories that happened in spite of him. The truth is that his “act more like Republicans” strategy just hasn’t worked out, and we’re getting whiffs of the disaster it spells for Democrats who follow it. [She is referring to Criegh Deeds frantic run away from national Democrats, as well as the poor showing of pro-War Dems in 2006]
Go read. This guy has a history of failing upward that rivals Dick Cheney’s.
Not really such a big patch of territory.
You don’t have to go far for help
I think that the book is an exercise in muddy headed contrarianism: The idea here is if you come to conclusions that are counter intuitive, particularly if they are favor conservatives, you get air time and book sales, and thus academic integrity be damned.
In any case, Professor Raymond T. Pierrehumbert takes a look at the chapter on Superfreakonomics where the authors claim that solar panels will contribute to global warming, and shows that anyone who can add 2 and 2 should never have put out this tripe.
First, he Googles world electric consumption, 16.83 trillion KWH, and figures back to wattage, which gives about 2 trillion (1.921T actually) watts.
Well, with 200w/m for an average area (he used 250 W on the assumption that you place solar cells in sunnier climes), and the current commercial efficiency of 15% that means that one would need about an area equal to 2×1012/(.15 X 250)=5.333×1010 m2=53,000 square kilometers, or a square about 231 kilometers to a side. (top picture).
Wiki has Earth’s surface area as 510,072,000 km2, so this is 0.0105% of the earth’s surface.
Now, you actually have to double this, since you need to account for the fact that at any given moment, half the earth’s surface is in darkness, so it rises to a whopping 0.0210% of the Earth’s surface area.
This is a worst case scenario, particularly since the albedo (reflectivity) of a solar cell is frequently the same as the roof that they are placed on (yes, this is an argument for white roofs in warm climates), but let’s ignore that, and go to his numbers:
So, let’s say that sand has a 50% albedo. [note the albedo of the earth is 0.39, I learned that from the Greek composer Vangelis] That means that each square meter of black solar cell absorbs an extra 125 Watts that otherwise would have been reflected by the sand (i.e. 50% of the 250 Watts per square meter of sunlight). Multiplying by the area of solar cell, we get 6.66 trillion Watts
That 6.66 trillion Watts is the “waste heat” that is a byproduct of generating electricity by using solar cells. All means of generating electricity involve waste heat, and fossil fuels are not an exception. A typical coal-fired power plant only is around 33% efficient, so you would need to release 6 trillion Watts of heat to burn the coal to make our 2 trillion Watts of electricity. That makes the waste heat of solar cells vs. coal basically a wash, and we could stop right there, but let’s continue our exercise in thinking with numbers anyway.
Of course, the problem is not the heat produced by coal production, it’s a trivial part of the equation, it’s the heat trapped by the emissions that are the concern, and it is (go to article) at least two orders of magnitude greater than waste heat.
His conclusion:
A more substantive (though in the end almost equally trivial) issue is the carbon emitted in the course of manufacturing solar cells, but that is not the matter at hand here. The point here is that really simple arithmetic, which you could not be bothered to do, would have been enough to tell you that the claim that the blackness of solar cells makes solar energy pointless is complete and utter nonsense. I don’t think you would have accepted such laziness and sloppiness in a term paper from one of your students, so why do you accept it from yourself? What does the failure to do such basic thinking with numbers say about the extent to which anything you write can be trusted? How do you think it reflects on the profession of economics when a member of that profession — somebody who that profession seems to esteem highly — publicly and noisily shows that he cannot be bothered to do simple arithmetic and elementary background reading? Not even for a subject of such paramount importance as global warming.
(emphasis mine)
He then finishes with a Google map (bottom pic) showing that it is a ½ mile walk to the Hinds Geophysical Laboratory on his own campus in order to confirm these numbers.
It would be even shorter if he cut through campus and the Administration building, though considering that the ethics office is likely located there, he probably wants to take the long way.
(on edit)
I updated the pictures to go with the popup format that I now use.
Given Michael Kinsley’s most recent exercise in mindless contrarianism, where he came out against journalism, I feel compelled to note that this behavior (Michael Kinsley disease) becomes even more toxic and has less intellectual integrity when juxtaposed with Chicago School economic delusions.
McClatchy, just finished an investigation of some of Goldman Sachs’ behavior, and the lede says it all:
In 2006 and 2007, Goldman Sachs Group peddled more than $40 billion in securities backed by at least 200,000 risky home mortgages, but never told the buyers it was secretly betting that a sharp drop in U.S. housing prices would send the value of those securities plummeting.
You know, being a bit more optimistic in public than being in private is a fuzzy line. This ain’t it.
Later in the article, it is discussed how Goldman, and hedge fund operator John Paulson, bought billions in Credit Default Swaps (CDS) on mortgage backed bonds to profit on the collapse.
Note that Paulson is in a different boat from Goldman, because he didn’t sell those bonds in the first place, but once again it shows how the lessons of the South Sea Bubble, which led to the Marine Insurance Act of 1746 have been forgotton and so it is no longer required that people who buy insurance, including swaps, must have a material interest in the underlying asset.
H/t Atrios.
My initial reaction, upon looking at the bios of the 10 winners, was that they were rather more establishment, and more “WaPo Columnist” (read conservative and mindless difference splitters) than I had hoped.
But I kind of figured that this might be sour grapes on my part, so I would let their biographies, and their submissions, percolate through my brain before I drew a firm conclusion.
Well, Kevin Drum, who already has a job as a pundit, and did not throw his hat into the Washington Post‘s ring, has taken a look at these winners of at this stage, and has a similar impression of them.
This is particularly notable because I am of the opinion that Drum spends too much time being a “mindless difference splitter”, so he is coming from a place that is far closer to the WaPo editorial board than I am.
His take on the winners:
By the way, the ten winners include a Nobel Prize winner, a Bush 43 assistant secretary of commerce (guess which one), a senior correspondent for the American Prospect, an analyst at the Council on Foreign Relations, a former researcher at the Kennedy School of Government, an Atlantic Media fellow, and a small-town newspaper editor. Not exactly a crowd of just plain folks. It might have been more fun to read the other 4,790 entries.
Well, that’s a bit harsher than I would have been, but go and read the Drum’s post…It’s a good read.
Here are my announcement of my submission, and my ding letter, by way of context.
My submission is after the break.
My essay (400 words)
Recently, the Federal Reserve has been on a populist bent, expanding its purview to regulate non bank lenders, issuing rulings on bank overdraft fees, demanding information from financial institutions on compensation, and issuing new consumer protections for mortgages, home-equity loans, and credit cards.
Why? Has the Fed realized that its regulatory regime has failed the general public, or is this the result of increasing calls for change from other branches of government?
This is not a conversion on the road to Damascus, but rather the Fed has decided to employ the strategy of Fabius Maximus, who used delay to give Rome victory over Carthage.
With proposals to audit their books, move consumer protection to another agency, and change the selection process for the regional Fed bank presidents, it is clear that some in Congress are looking to clip the Fed’s wings.
Organizations fight fiercely for their authority, and against external oversight. The recent actions on consumer protections are part of a rear guard action to protect their bureaucratic prerogatives.
This is understandable, but it is a disservice to both the public and the Federal Reserve.
The Federal Reserve’s responsibilities are to maintain a stable currency and stable economy, which involves removing the proverbial “punch bowl” when times are good, in order to prevent inflation, and to provide liquidity when times are bad to allow the economy to recover.
Additionally, the Federal Reserve structure and history make it obsessively focused on protecting the banking system, and, the banking industry. That is why it has eschewed consumer protections until recently: it is loath to reduce the profits of the banks it supervises.
No institution can do this without being firmly protected from politics, since political pressure will always favor immediate growth, even at the cost of future catastrophe. Just look at Zimbabwe.
Consumer protection does not need separation from politics though, it needs to be engaged with those consumers, whom it is charged to protect, and with the representatives who have been elected by these people.
This requires a level of transparency and responsiveness to the public that is antithetical to the primary functions of a central bank.
If the members of the Federal Reserve wish to remain independent, which is both best for the country, and for the Federal Reserve, we should move those functions to other agencies which are more directly answerable to the public.
Nothing too earth shattering, but there are a lot of better thinkers, and better writers, out there, and looking back on it, my invocation of Fabius Maximus was probably a mistake. It’s too Monty Python’s Life of Brian.
There it is in black and white, on the opinion page of the Rupert Murdoch owned Wall Street Journal, a we have an article that calls out the Rupert Murdoch owned Fox News for lack of journalistic integrity:
But no journalistic operation is better prepared to sing the tragedy of its own martyrdom than Fox News. To all the usual journalistic instincts it adds its grand narrative of Middle America’s disrespectful treatment by the liberal elite. Persecution fantasy is Fox News’s lifeblood; give it the faintest whiff of the real thing and look out for a gale-force hissy fit.
The author, Thomas Frank, had better hope that Rupert Murdoch does not read the OP/ED page of his flagship newspaper.
Luckily for Mr. Frank, I’d give 2 to 1 odds that he doesn’t.
Donald J. Boudreaux writing in (where else) The Wall Street Journal, suggests that insider trading is actually a good thing:
Time to stop telling horror stories. Federal agents are wasting their time slapping handcuffs on hedge fund traders like Raj Rajaratnam, the financier charged last week with trading on nonpublic information involving IBM, Google and other big companies. The reassuring truth: Insider trading is impossible to police and helpful to markets and investors. Parsing the difference between legal and illegal insider trading is futile—and a disservice to all investors. Far from being so injurious to the economy that its practice must be criminalized, insiders buying and selling stocks based on their knowledge play a critical role in keeping asset prices honest—in keeping prices from lying to the public about corporate realities.
Prohibitions on insider trading prevent the market from adjusting as quickly as possible to changes in the demand for, and supply of, corporate assets. The result is prices that lie.
Do you get it? It facilitates price discovery to allow people to make a profit with information that allows them to know which way the price is going.
This is much like the arguments for naked Credit Default Swap (CDS) contracts, where people are getting insurance for items in which they have no interest in its continued existence, and so give people a reason to burn down your house, or at least your bond, and it is just as vacuous.
A look at the Wiki reveals that this guy is a card carrying Randoid puke through and through.
H/t Jeff Matthews Is Not Making This Up, who does a much better job of demolishing this crap than I do, so just go and read his.
For your amusement, here are his last 2 ‘graphs:
Communism didn’t work for the simple reason that those who were first in line stole the means of production from the poor shlubs with whom they were supposed to share those means of production.
And unfettered insider information won’t work, for precisely the same reason.
You’ve seen it, the various mash-ups that have been done with the German movie Downfall (Der Untergang), where people take a rant by Hitler, as played by Bruno Ganz, and subtitle it, so it appears that he is ranting about XBox games, losing a parking space, becoming a meme, or Super Bowl Results.
Well, it now appears that Constantin Film Produktion GmbH is hitting Youtube with a flurry of DMCA takedown demands. As Brad Templeton of the EFF Notes, this is absurd. The copies do no damage to the producers of the movie, and people are watching this short bit (about 4 minutes) for the subtitles, not the film.
He makes some very good points about just how absurd the hoops that he had to jump through in order to make the film in full accordance of the DMCA, despite the fact that this is clearly fair use.
Go read,
He also gets jiggy with the Hitler rant, only this time, Hitler is assuming the role of a studio executive, not much of a stretch, and trying to lock down the content.
It’s very funny, and contains the classic line, “Have you seen how good that Führerbunker scene is? Bruno Ganz does a great Hitler!”
Video follows:
Alex Pareene has a righteous take-down of the Washington Post OP/Ed section, calling it, “The Worst Opinion Section in America.”
I disagree, UI think that the Wall Street Journal is worse, but I understand how this is a close call. It’s like comparing the the St. Louis Rams, Tampa Bay Buccaneers, Detroit Lions, Tennessee Titans, and Cleveland Browns, a lot of badness in the eye of the beholder.
Will Bunch notes that a number of so called liberal pundits have gone after Barack Obama:
Kind of reminds me of all those conservative columnists who gave Bush a honeymoon in those early months of 2001 but eventually went after him when it became clear that he’d invaded another country for bogus reasons, was assaulting the civil liberties of Americans and bankrupting the national treasury with unnecessary tax cuts at a time of proflagate spending.
Remember those columnists?
Me neither.
(emphasis mine)
Too true.
Basically, after years of no support for their unions, and bankruptcy laws that do nothing to reign in executive compensation, pilot salaries have become so low that pilots frequently have to work 2nd jobs, and no small number are on food stamps.
You get what you pay for, and right now, we are paying for lots of airliners crashing by not paying pilots enough.
Here’s a sample:
I told the guys that I have a whole section in my new movie about how pilots are treated (using pilots as only one example of how people’s wages have been slashed and the middle class decimated). In the movie I interview a pilot for a major airline who made $17,000 last year. For four months he was eligible — and received — food stamps. Another pilot in the film has a second job as a dog walker.
“I have a second job!,” the two pilots said in unison. One is a substitute teacher. The other works in a coffee shop. You know, maybe it’s just me, but the two occupations whose workers shouldn’t be humpin’ a second job are brain surgeons and airline pilots. Call me crazy.
There has been an aggressive war on the wages of people who actually do useful stuff, as opposed to bosses and investors, since the Carter administration, and this is not a good thing.
PZ Myers notes on his Pharyngula blog that Supreme Court Justice Antonin Scalia is an incompetent hypocrite, which is not a tough call.
In this case, it was during arguments in Buono v. Salazar, during which Fat Tony basically said that everyone uses crosses to memorialize the dead, and when the counsel for the ACLU Peter Eliasberg notes that you won’t find crosses in Jewish cemeteries, Scalia finds it, “an outrageous conclusion,” that people would consider the symbol of Christianity to be….Well …. Christian.
Well, Dr. Meyers has a suggestion, which I endorse with one caveat:
Since Scalia is such an open-minded syncretist, I suggest that when he dies, right after all the partying and celebration, we atheists pass around a hat and get a collection going to erect a huge Muslim crescent over his grave. Not only will it honor the dead man, but it’ll let us do double-duty when we all line up to piss on it. Everyone wins!
My only request is that he be buried near enough to Ayn Rand that I do not need 2 beers to “show my respects” to both of them.
As I’ve said before, do not with f$#% with Jon Stewart, and when you go after a comedy program and “fact check”, as CNN did with a Saturday Night Live sketch, you are messing with the bull, and they got the horns when Stewart fact checked CNN:
Stewart made the obvious point, before you fact check a comedy show, how about fact checking people who are on your news programs, or even knowing how to check the numbers?
A note to the so-called journalists on cable news:
Do not f$#% with comedians. They are smarter than you are, they are better informed, they are better looking, and they are probably better in bed.
Unfortunately, I’ll have to leave it right there……………..
Fafnir on Iran, just go read.
An amusing story about network management, right out of John Carpenter’s 1982 version of The Thing.*
It appears that there was a small bit of civil unrest, and a client lost connectivity, and they were unable to contact the client for some time.
When they finally managed to get an engineer over to reboot the network, the network was gone…as in GONE…the copper taken by looters, stripped right out of the walls.
The pertinent quote from the movie:
Garry: The generator’s gone.
MacReady: Any way we can we fix it?
Garry: It’s “gone”, MacReady.
Just go read it, it’s funny.
*Except, of course for that whole human replica producing alien thing, of course.
Luckily, I don’t have to worry too much about this, if push comes to shove, I can go to Israel immediately, under the law of return.
But a reader of Americablog is asking this question:
….
When Bush won his second term, I reached deep within for the small bud of hope that remained, and built on that. Throughout the primary and general elections, many of us within the Obama volunteer team felt we’d proven that one person truly can make a difference. Now, after merely 10 months in office, the lack of action on the part of team Obama (DOMA, DADT, etc.), the bizarrely run health care reform effort combined with the subsequent willingness to kill the public option, the Obama administration’s approach to education have led me to a breaking point.
I sense that they don’t uphold any of the progressive ideals for which we fought, or on which he campaigned. That hope he told us to find, to rekindle – he and his administration have killed it more fully than Bush and his cronies ever did. Moving out of this country, where it appears a select few ‘haves’ control the outcome regardless of public opinion, suddenly presents a most palatable option. I’ve asked around, and it turns out that applications for nurse abroad and teach abroad programs are up over 300% in Colorado. That isn’t the least bit surprising to me, and I don’t think it’s economically motivated.
…..
I think that Barack Obama and His Stupid Minions™ have done everything in their power to avoid making progressive policy, and have done everything in their power to defund and disempower progressives, and as such, much as Bill Clinton did in 1994 with his nail and tongs fight for NAFTA (not healthcare reform), he is demoralizing his base.
2010 will not be pretty, because with his voters dispirited, and the swing voters looking looking at a choice between phony Republicans (Obama) and real ones, will, to Paraphrase Harry S Truman, choose the real Republicans every time.
Read the whole thing.
