Thursday, March 26, 2009

Good News for Greens


This is shaping up to be a week of decidedly good environmental news. First the EPA announced that it’s getting tough on mountaintop removal mining, and then, yesterday afternoon, the House passed an omnibus lands bill that creates the biggest expansion of the nation’s wilderness-preservation system since 1994. The bill, which has already passed the Senate and which Obama has promised to sign, sets aside 2.1 million acres of new wilderness in nine states.

--Rob Inglis (Flickr photo credit: erality)

Saturday, March 21, 2009

Out tappin'...

Saturday, March 14, 2009

Fiscal Food Poisoning

Pepto Bismol moment. When Chinese Premier Wen Jiabao thinks about his country's foreign-reserve holdings, indigestion sets in. You see, China holds upwards of $1.3 trillion in U.S. Treasury bonds, a sizable nestegg on the face of it. However, Wen sees a big problem ahead: the U.S. is about to flood the market with trillions in new debt to pay for takeovers, bailouts, buy-ins, and pump-ups--as well as to service and retire old debt. The Law of Supply and Demand suggests that China's dollar-denominated reserves are going to lose value. Indeed, they were losing value even as Wen addressed Friday's press conference marking the close of the National People’s Congress.

“We have lent a huge amount of money to the United States,” Wen reminded reporters. “Of course we are concerned about the safety of our assets. To be honest, I am a little bit worried. I request the US to maintain its good credit, to honor its promises and to guarantee the safety of China’s assets.” Clearly, Wen derives little comfort from the motto "In God We Trust" splashed all over U.S. coinage and currency. He's a numbers man, and to him the U.S. budget looks like this:
Thanks to Jake at EconomicPic Data.

Tuesday, March 10, 2009

Year of the Ox

Light at the end of the tunnel? Things may be picking up for the Chinese six weeks into their new year, the Year of the Ox, which is historically a harbinger of prosperity. Minyanville's Prieur du Plessis points out that the Purchasing Managers' Index for China's manufacturers has strengthened over the past three months. In particular, the sub-index for new export orders jumped sharply in February. As the graph above shows, the PMI for new orders correlates closely with the Baltic Dry Index, which measures freight rates of iron ore and bulk goods. As goes the Baltic Dry Index, so goes the global economy.

Stock prices in China also reflect a renewed optimism, as the Shanghai Composite Index has risen 40% since the government announced a stimulus program in November. We should be cautious, however, about extrapolating expectations of economic growth in China to the Western economies. Eastern European nations are about to default on their sovereign debt, which will have a huge negative impact on the Eurozone banks investing heavily in that region. Meanwhile, back here in the good ol' U.S. of A., markets are reacting negatively to government stimulus plans. China, remember, is stimulating from a position of fiscal strength. The U.S. is not.

Wednesday, March 4, 2009

Déjà Dubya

Quick quiz. Relax. You know this one. Name a Republican, a D.C. outsider, elected President of the United States with less than 50% of the popular vote (love those third-party candidates). Within months of this man's inauguration, an attack took place on federal property here in America. The new President decided to punish the perpetrators by launching a war without a Congressional declaration--a war expected to last weeks, at most months.

Instead, the conflict dragged on for years. The U.S. had the advantage in military and economic might, but that seemed not to matter. As the stalemate continued, there was enormous collateral damage to civilian lives and property. And the losses of U.S. soldiers became almost too much to bear. The beleaguered President tightened security by curtailing civil liberties and wiretapping domestic communications. Those deemed enemies of the state were imprisoned without trial or due process.

The easy answer: George W. Bush. And if you missed that one (heck, you might have been too busy flipping condos to pay much attention to what Dubya was doing during his two terms), you get another chance because there is more than one correct answer. Abraham Lincoln also works. Whoa, you say. You mean that Mt. Rushmore dude who just turned 200 years old? The finski in my wallet? The Father--no, wait--The Uncle of Our Country?

Yup. Him. And while Lincoln to this day is revered by the majority of Americans, there are some who consider him unworthy of statuary prominence. Among Lincoln's detractors is Thomas DiLorenzo, author of The Real Lincoln (subtitle: A New Look at Abraham Lincoln, His Agenda, and an Unnecessary War). DiLorenzo argues that the American Civil War was not necessary to abolish slavery, nor was it originally intended to. It was fought, rather, for economic and political reasons.

Lincoln's vision of a strong central government transcending the rights of individual states (including the right to secede) is, depending on your viewpoint, either unconstitutional or post-constitutional. Either way, it appears at odds with the Jeffersonian ideal of a loose federation of relatively sovereign states. In DiLorenzo's words, it was "a blueprint for big government in America, with its income taxation, protectionism, central banking, internal revenue bureaucracy, military conscription, huge standing army, corporate welfare, and foreign policy meddling." It was a blueprint, moreover, advanced at gunpoint.

DiLorenzo has my ear for two reasons. One, we do have big government, about to get bigger, and it is killing us. Two, the Civil War was senseless and diabolically destructive and ought to have been avoided. The modern fascination for all things blue and gray has always escaped me--the monuments and museums, the re-enactments, the glory-glory-hallelujah! All of it. The Civil War was neanderthal in its prosecution (oops, sorry, all you cave guys), 19th-century weaponry welded to 17th-century tactics, static rows rather than mobile columns. It was a turkey shoot.

620,000 uniformed turkeys died on both sides. Tens of thousands more were horribly maimed. Both the Union and the Confederacy resorted to conscription to find more turkeys. In all, 8% of the white male population between the ages of 13 and 43, North and South combined, gave their lives. Census figures right here in Oxford County, Maine, show that it took decades to recover from the war and the economic decline that ensued.

They would still be shooting at each other if Lincoln had not adopted a different strategy: rape, pillage, and plunder. Generals Sheridan and Sherman--the "Phil and Bill" Show--were turned loose behind enemy lines to scorch the earth, victimizing noncombatants and essentially starving the Confederate Army. Had the Union lost and the President been apprehended, DiLorenzo surmises that Honest Abe would have been tried for war crimes. The punishment was the same then, Sadaam, as it is now.

Not everyone at the time thought that war was the answer. Published appeals for a peaceful resolution, however, were repressed by the Lincoln Administration. Newspapers editorializing against the war were prohibited from delivering through the U.S. mails. When private couriers were used instead, federal marshals were dispatched to confiscate the papers. Editors who persisted in criticizing the President were rounded up and detained in Lincoln's Gitmo, Fort Lafayette in New York Harbor. Printing presses (including those of the Bangor Democrat in Maine) were destroyed by feverish mobs while federal soldiers looked the other way. Lincoln even had one of his congressional critics, Clement Vallandigham of Ohio, tried by a military tribunal and deported. The Great Debater would allow no further debate.

To similar criticism, our 43rd President was blissfully indifferent and impervious. Bring it ON! Perhaps the Great Decider deserves a place among the Dakota Dudes.