Most Asian markets recover on hopes of U.S. bailout (LA Times, October 1, 2008)
Most Asian markets bounced back Wednesday on hopes that a $700 billion bailout for the U.S. financial system will soon win legislative approval, although doubts persisted about the long-term outlook for the global economy.Japan's Nikkei 225 index, the benchmark for Asia's biggest bourse, gained 108.40 points, or 0.96 percent, to close at 11,368.26. On Tuesday, it plunged 4.1 percent to its lowest in more than three years on disappointment that the U.S. House of Representatives had rejected the bank rescue package.
The International Monetary Fund has added to the growing pressure on the US Congress to approve the Wall Street bail-out, as stockmarkets rose on optimism that a deal will be hammered out this week.Dominique Strauss-Kahn, managing director of the IMF, warned last night that the US must take urgent steps to protect its economy from the ongoing financial crisis.
"We're right at the moment where action is needed," warned Strauss-Kahn. "A non-perfect plan is better than no plan at all," he added, in an interview with Reuters in Washington.
The prospect of a deal this week sent shares up in London this morning, where the FTSE 100 continued yesterday's bounce-back.
An air of confusion and disbelief still reigned among House Republicans on Tuesday, as GOP leaders kept a low public profile, quietly calling their colleagues to try to figure out what led to Monday’s bailout vote meltdown and what steps to take next.
Best Steam Trains: Walt Disney's Carolwood Barn (MOLLY LAMBERT October 02, 2008, LA Weekly)
Steam trains were an obsession for Walt Disney since his childhood. From his earliest sketches, he planned to have a railroad circling around the park at Disneyland. Ward Kimball and Ollie Johnson, two of Disney Studios’ “Nine Old Men” of animation, shared the same obsession. They introduced Walt to their hobby of narrow-gauge live-steam backyard railroading, inspiring Disney to re-create the barn from his family home in Missouri and make his own miniature track. He used the barn as a workshop for his Carolwood Railroad, a fully operating steam train built an eighth of the size of the real thing on a half-mile of track. Although his train, the Lilly Belle, resides at Disneyland, Walt’s Carolwood Barn has been relocated to Griffith Park’s former Travel Town, now known as the Los Angeles Live Steamers Museum. The Barn is open free to the public on the third Sunday of each month, 11 a.m. to 3 p.m., with guided tours provided by members of the Carolwood Pacific Historical Society
Los Angeles Live Steamers Museum, 5202 Zoo Dr., L.A., (323) 662-8030; www.lals.org or www.carolwood.org.
Bailout not dead yet (RYAN GRIM & MARTIN KADY II, 9/30/08, Politico)
The bailout is back.Senate leaders have decided to take up the failed House version of the $700 billion economic rescue bill, and plan to add a widely supported change in the Federal Deposit Insurance Corp. caps.
The dollar soared against the euro as signs of trouble in the European banking sector created overseas demand for greenbacks.The yen also fell victim to the U.S. currency Tuesday, as a partial recovery in U.S. stock markets from Monday's free fall boosted risk appetite, leading investors away from the low-yielding Japanese currency.
Currency investors put aside their worries about the U.S. banking system Tuesday as optimism rose that Congress soon may reach agreement on the government's proposed $700 billion financial-rescue package.
Your flesh will crawl right across your desk:
Where Credit Is Due (David Freddoso, 9/30/08, National Review)
House Republican leaders] blamed the failure of the bailout bill on a speech given by House Speaker Nancy Pelosi.“We could have gotten there today had it not been for the partisan speech that the speaker gave on the floor of the House,” House Minority Leader John Boehner (R., Ohio) said yesterday. Pelosi’s speech, he said, “poisoned our conference, caused a number of members that we thought we could get, to go south.” [...]
[D]o House Republican leaders really want us to believe that Republicans killed the bailout just because their feelings were hurt? Are they trying to tell us that Republicans are touchy whiners who will let their country down on a supposedly essential matter because they were offended by typical, turgid partisan rhetoric?
Ron Paul, Dennis Kucinich: 'Lipstick' off (Mark Silva, 9/30/08, The Swamp)
Ron Paul and Dennis Kucinich are on top.Let history record that, for one fleeting moment perhaps this week, the most anti-establishment candidates for either major parties' presidential nominations this year - two who stirred a lot of emotion but attracted few votes -- were riding the wave of the victorious majority of the House of Representatives.
They balked at the bailout.
House Members Receive Angry Calls on Vote, Aides Say (James Rowley and Nicholas Johnston, 9/30/08, Bloomberg)
Lawmakers received a flurry of calls demanding that they revive the U.S. economy after the House's rejection of a $700 billion financial-rescue plan triggered a record drop in stocks, House aides said.The calls countered an earlier outpouring of opposition to the legislation.
``A lot of people called to complain about losing their shirt,'' said Sean Brown, press secretary for Republican Representative Joe Barton of Texas, who opposed the measure. Calls have gone from overwhelmingly against the bill to about 60- 40 or 70-30 in favor of it, Brown said.
Pakistani Taliban leader dead, sources say (CNN, 9/30/08)
The leader of Pakistan's Taliban, Baitullah Mehsud, is dead from kidney failure, sources told CNN.The Pakistan government blamed Mehsud for the December 27, 2007, assassination of former Prime Minister Benazir Bhutto.
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Suspected US drone strike kills four in Pakistan: officials (AFP, 9/30/08)
A missile strike by a suspected US spy drone hit a house in a Pakistani tribal area bordering Afghanistan, killing at least four people and wounding nine, security officials said Wednesday.The attack is the latest in a string of incidents on the rugged frontier that have raised tensions between Islamabad and Washington, including a clash between Pakistani troops and US-led forces in Afghanistan.
It happened shortly after Pashtun tribesmen shot at three drones circling the village of Khusali Toorikhel in North Waziristan, a known haunt of Taliban and Al-Qaeda militants.
Beef-Sauced Hot Lettuce Salad (Contra Costa Times, 9/30/08)
4 packed cups coarsely torn romaine lettuce1 tablespoon peanut oil or vegetable oil
1 tablespoon minced garlic
1 tablespoon minced ginger
½-pound (1 packed cup) ground beef
1 tablespoon soy sauce, or to taste
1 tablespoon Jinjiang (black rice) vinegar, or to taste
½ cup warm water
2 teaspoons cornstarch
1 tablespoon cold water
½ teaspoon roasted sesame oil
1. Place lettuce in a wide salad bowl or serving dish and set aside. Place a wok or heavy skillet over medium-high heat.
2. When wok is hot, add the oil and swirl to coat the bottom of the pan. Toss in the garlic and stir-fry 10 seconds, then add the ginger. Stir-fry over medium-high to medium heat until slightly softened and starting to turn color.
3. Add the meat and use the spatula to break it up so there are no lumps, then add the salt and stir-fry until most of the meat has changed color.
4. Add the soy sauce and vinegar and stir to blend. Add the warm water and stir. (The dressing can be prepared ahead to this point and set aside for 20 minutes. When you are ready to proceed, bring to a boil.)
5.
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While the dressing mixture is coming to a boil, place cornstarch in a small cup or bowl and stir in the cold water to make a smooth paste. Once liquid is bubbling in the pan, add the cornstarch mixture and stir for about 1 minute; the liquid will thicken and become smoother. Taste for salt.6. Add the sesame oil, stir, then pour the dressing onto the lettuce. Immediately toss the salad to expose all the greens to the hot dressing. Serve immediately for crunchy lettuce, or for a softer texture, let the salad stand 5 minutes before serving.
Remembering a great racing fan and man, Paul Newman (Frank Deford, 9/30/08, Sports Illustrated)
One time, years ago, when he was still indisputably the handsomest man in the world, my wife ran across him in a bookstore. All the other women were pretending not to notice, bumping into the aisles. Newman was with one of his daughters. At the checkout counter, he called over to her: "OK, honey, let's go." And, my wife swears, every woman in that store -- including my wife herself, I'm sure -- gave an involuntarily head feint toward the door. It was better than watching a vaudeville sketch.The last time I saw him was a few months ago. There were already rumors that he was dying. He was never so large as he appeared on the screen, but now, even as he was still in good humor, he looked positively frail. We were at a small concert, and, just by chance, he and Joanne sat right next to me and my wife. When the lights dimmed I happened to glance over, and I saw that, right away, he'd taken his wife's hand. They'd only been married 50 years. He kept holding it all the way through, just like they were teenagers. Lord, but it was so dear.
I reached over and took my wife's hand. There are not many things any of us could do so well as Paul Newman, but, I thought, if you could follow his lead in any way, then you'd be a fool not to.
Stunning day for Dow: Closes up more than 450 (AP, 9/30/08)
Wall Street has ended sharply higher as investors bet that lawmakers will salvage a $700 billion rescue plan for the financial sector. The Dow Jones industrials surged nearly 500 points to the 10,860 level.The rally offset Monday’s 778-point rout, one of the biggest selloffs in years. The recovery wasn’t unexpected as carnage on Wall Street often attracts bargain hunters.
However, the seized-up credit markets where businesses turn to raise money showed no sign of relief. A key rate that banks charge to lend to one another shot higher, a tightening of the availability of credit that could cascade through the economy.
We're hearing lots of talk this afternoon that with the House unable to quickly come up with an alternative to the $700 billion bank bailout it rejected Monday, the Senate is ready to take the lead. It's being described this way, says a source: "It's time for the adult body to take over." And that's from a Republican.
Pelosi, Reid express their willingness to work together on pushing an economic rescue package through Congress in a letter to the President.“We welcome your statement this morning and are committed to working with you and our Republican colleagues to enact a bipartisan bill without further delay.”
Barack Obama on Tuesday stepped up his advocacy for the Bush Administration’s endangered $700 billion bailout plan by making a round of calls to rank-and-file Democrats in the House and casting congressional inaction in dire, real-world terms. He also massaged his pitch, no longer using the word “bailout” to describe the bill.In a speech laden with warnings about the impact on average voters, Obama made his strongest push yet for the financial package rejected Monday by the House, saying the upheaval was “no longer just a Wall Street crisis – it’s an American crisis, and it’s the American economy that needs this rescue plan.”
The Federal Deposit Insurance Corp. will seek authority from Congress to temporarily raise deposit insurance limits, the agency’s chairwoman, Sheila Bair, said today. [...]Raising the limit "would provide the dual benefits of providing additional liquidity to banks for lending as well as provide some additional reassurance to depositors above the current limits," Bair said.
Higher limits could be particularly helpful for smaller banks as they struggle to hold on to deposits amid public fears of rising bank failures because of loan losses.
World leaders look to US for salvation as economies near abyss (AFP, Sep 30, 2008)
World leaders called on the US government to take action to stave off global financial collapse Tuesday after Congress rejected a 700 billion dollar bailout in a move which stunned global markets.
The uncertainty swirling around the financial crisis in the United States has sparked concerns in Japan that more bad news is on the way for exporters, consumption and the economy, analysts said Tuesday.The U.S. House of Representative's shocking rejection of a $700 billion rescue plan Monday sent Wall Street into its worst single-day plunge — on a points basis — and triggered a 483-point selloff in Tokyo stocks Tuesday.
"The situation is getting quite serious," said Hideo Kumano, chief economist at Dai-ichi Life Research Institute. "All we can do is to wait for an amendment to the U.S. bailout plan."
After the rejection of the bailout bill by the House of Representatives, banks hoarded cash, driving Libor up to 6.88 percent. A week ago, Libor was at 2.95 percent. (Normally, it's slightly more than the Federal Reserve's target fed funds rate.) Points out MarketBeat: "It's more than a little ironic that while investors are buying banks' stocks—shares were up sharply across the sector—banks themselves were unwilling to buy each others' shortest term debt. Banks are so desperate for funds that they paid 11% for $30 billion in overnight funds from the European Central Bank, up from 3% just Monday."The Associated Press answers the million-dollar question: So how does this affect my life?
A. More than half of U.S. adjustable rate home loans are tied to Libor, so a recent increase in this benchmark rate mean monthly mortgage payments will rise for affected homeowners if the rise is sustained. A typical adjustable rate home loan will adjust based on the six-month Libor, plus 2 to 3 percentage points. Plus, many home equity lines of credit, small business loans and student loans also use Libor as an index. Student loans, for example, can be set based on the three-month Libor rate plus, say, 4 percentage points or the one month Libor rate, plus 9 percentage points.
Meanwhile, The "TED spread"—which represents the difference between what banks charge each other to borrow for three months and what three-month U.S. treasuries yield—surged to its highest level in more than 25 years Monday.
Is the Republican Alliance Finally Breaking?: The rebellion of House Republicans yesterday was more than a tactic to help John McCain. It may have been the beginning of the end of the political deal that has defined the last three decades. (Mark Schmitt, September 26, 2008, American Prospect)
Everything in America seemed to converge in a few meeting rooms in Washington yesterday: The rapid meltdown of the speculative economy. George Bush's desperate desire to remain relevant. The evolution of the opposition Democratic Party, in the person of Rep. Barney Frank, into a profoundly serious governing party ready to help George Bush's Treasury Secretary Hank Paulson write the bailout he should have written in the first place. And then John McCain trying to do two things at once: Shake up his campaign and win a few more news cycles, and get a hit of the only kind of legislative success he ever had, when he would sweep into the room where there was some sort of bipartisan deal to be cut, and insert himself into the middle of it. (Although that tactic almost always produced more press coverage than legislation.)By the end of the day, it was clear that the most significant issue was the defection of the House Republicans, which could have an impact on the Republican political coalition of more lasting consequence than its derailing of the bailout. Where McCain swept in to heal a partisan breach, the real differences turned out to be between, on one side, Democrats in the House and Senate, Senate Republicans, George W. Bush, and Bush's Treasury Secretary Henry Paulson, who asked for the deal; and on the other side, the Republicans in the House of Representatives.
Candidates, Bush urge reviving financial bailout (JIM KUHNHENN, 9/30/08, Associated Press)
President Bush warned Tuesday that failing to pass a financial rescue plan would bring severe consequences to the U.S. economy. "Congress must act," he declared in an appeal that John McCain and Barack Obama echoed.McCain and Obama separately urged Congress to redouble efforts to get a deal through and both proposed increasing federal deposit insurance to $250,000, as a key part of it. Both McCain and Obama called and spoke to the president on Tuesday, a White House official said. [...]
Bush noted that the maximum $700 billion in the proposed bailout was huge, but was dwarfed by the $1 trillion in lost wealth that resulted from Monday's stock-market plunge.
"Because the government would be purchasing troubled assets and selling them once the market recovers," he said, "it is likely that many of the assets would go up in value over time. Ultimately, we expect that much - if not all - of the tax dollars we invest will be paid back."
For Many Americans, Fear and Distrust Run High (Joel Achenbach and Ashley Surdin, 9/30/08, Washington Post)
Many people yesterday afternoon were still absorbing the news that the stock market had gone into a dive -- hitting a couple of ledges on the way down the cliff -- and it is possible that sentiment for some kind of bailout could increase as investors look at their portfolios."I thought: This doesn't seem to be affecting me or my family," said Chuck Taggart, 46, a New Orleans native who lives in Los Angeles. "Then I looked at my 401(k) today."
It was down 19 percent.
"I'm nervous about the whole thing."
To a degree that few Americans could have appreciated just a few weeks ago, the economy runs on credit. But politics runs on a form of credit, too, generically known as trust, and trust has been a scarce commodity recently in Washington.
President Bush, burdened with historically low approval ratings, was slow to try to sell to the American people what he called a "rescue." Academic economists frowned upon the legislation, and radio talk show hosts railed against it.
The bailout lacked a sympathetic character at the heart of the narrative. And many Americans simply did not believe that the government had the basic competence to do the right thing.
"You've got massive public distrust and dissatisfaction, with the bailout specifically, with government in general, and George Bush and the entire political establishment," said Doug Muzzio, professor of public affairs at Baruch College in New York.
In a USA Today-Gallup poll conducted Friday and Saturday, 39 percent of respondents said they approved of the way Democratic leaders in Congress responded to the financial crisis, 31 percent approved of the Republican congressional leadership's response, and 28 percent approved of Bush's handling of the situation.
"This vote is a reflection of a lack of political capital, not of financial capital," said Mitchell Moss, a professor of urban planning at New York University. "The bankruptcy exists in our political leadership, not on Wall Street. We need to bail out Nancy Pelosi and George Bush."
Ideal of the Scoop (NY Sun, September 30, 2008)
Following are excerpts of remarks by the Editor of the Sun, Seth Lipsky, to the newspaper's staff:It is my duty to report today that Ira Stoll and I and our partners have concluded that the Sun will cease publication. Our last number will be the issue dated September 30, the first day of Rosh Hashanah. I want you to know that Ira and I, and our partners, explored every possible way to avoid having to cease publication.
We have spoken with every individual who seemed to be a prospective partner, and everywhere we were received with courtesy and respect. I tend to be an optimist and held out hope for a favorable outcome as late as mid-afternoon today. But among other problems that we faced was the fact that this month, not to mention this week, has been one of the worst in a century in which to be trying to raise capital, and in the end we were out not only of money but time.
European Governments Rescue Another Failing Bank (Edward Cody and Mary Jordan, 9/30/08, Washington Post)
European confidence was eroded over the weekend by a raft of emergency bank rescues. By Monday morning, after Asian stock markets had nose-dived, credit markets were seizing up, meaning that the normal flow of trading among banks wasn't taking place. The European Central Bank then announced it was pumping an extra $173 billion into European markets. In Washington, the Federal Reserve said it would make an additional $620 billion available for future lending to nine foreign central banks.The head of one of those nine, Bank of Japan Governor Masaaki Shirakawa, said Monday that global financial liquidity "has almost dried up."
European banks are strained by the recent collapse of property booms close to home, notably in Britain, Spain, Portugal and Ireland, by exposure to bad U.S. mortgage securities, and by the general drying up of short-term credit. Japan's economy is already suffering from a highly unusual trade deficit, and domestic demand for goods appears to be waning, too, the Tokyo government reported Tuesday. Last month household spending fell 4 percent and factory output dropped 3.5 percent.
The House rejection of the White House's $700 billion rescue plan seemed likely to increase international concern over what might be next.
In Europe, the banking crisis "can hardly spread further -- it is everywhere," said Willem Buiter, a professor at the London School of Economics and former member of the Bank of England's monetary policy committee.
European Central Bank President Jean-Claude Trichet sat down Sunday with several European finance ministers in Brussels to discuss loosening European Union rules on government guarantees for banks in need of quick infusions of capital. Their meeting suggested that European governments feared they would need to intervene again.
French President Nicolas Sarkozy, who said Thursday that French banks appeared able to overcome the threat, summoned the country's top bank executives, his senior financial aides and the governor of the Bank of France for an urgent meeting Tuesday. His finance minister, Christine Lagarde, renewed her promise that "the government will assume its responsibilities" to prevent losses to French savings and investment account holders.
Sarkozy's office said he had conferred Friday with President Bush, pushing his idea for a meeting of heads of state from the major industrial powers by year's end to envision a top-to-bottom overhaul of the world financial system. The summit could be held at Bretton Woods, N.H., where officials met in 1944 to set the basics of today's world financial system, the Paris media reported.
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Wild Times in the Credit Markets (Ben Levisohn, 9/30/08, Der Spiegel)
With the financial system bailout plan derailed by the House of Representatives on Sept. 29, the resulting plunge in equities made headlines around the world. But while the stocks gyrate, it's important to keep one thing in mind: The big problem for financial markets is still the credit crunch. So as bad as equities have looked -- and during the big Sept. 29 sell-off, they looked pretty bad -- the true indicators investors should be watching are obscure measures such as credit default swaps, TED spreads, and commercial paper volume (all explained below).These names may sound wonky and insider-y, but they are nonetheless vital to understanding just how difficult, costly, and fearful the credit markets have become. They're the reason the stock market, in general an indicator of investor sentiment, plunged on Sept. 29 after the bailout failed. Without the plan, the markets recognized that the credit markets, the lifeblood of American business, will get worse before they get better. "The market understands the lack of liquidity that exists and the repercussions it will have on companies big and small," says American Capital CEO Malon Wilkis.
US shares are expected to rise on opening after President George W Bush renewed calls for Congress to back the $700bn (£380bn) banking rescue plan.Although Wall Street saw sharp falls on Monday after Congress blocked the deal, investors appear hopeful a fresh plan can be agreed later this week.
Mr Bush warned that if agreement is not reached, the US economy faces "painful and lasting damage".
Global shares have seen volatile trading since Monday's deal failure.
"Meltdown" is how many of the papers describe the extraordinary falls in the financial markets after the shock vote.According to the Times, money markets lurched close to a "catastrophic breakdown" on hearing the news.
For the Daily Telegraph, what could have averted the "potential collapse of the global financial system" has left it "staring into the abyss"
McCain at dead end as House rejects bailout plan (STEVEN R. HURST, 9/30/08, AP)
Republican John McCain has maneuvered himself into a political dead end and has five weeks to find his way out.Last Wednesday, McCain suspended his presidential campaign to insert himself into a $700 billion effort to rescue America's crumbling financial structure. In so doing, he tied himself far more tightly to the bill than did his Democratic opponent, Barack Obama.
Then, as the bailout plan appeared ready for passage Monday in the House, McCain bragged that he was an action-oriented Teddy Roosevelt Republican who did not sit on the sidelines at a moment of crisis.
The implication: that he played a critical role in building bipartisan support for the unprecedented bailout.
They've plunked down everything on the hope that the crisis is fake and that Americans don't want anything done about it. That's a losing bet, but the public rightly identifies them with it, Wall St. Problems Viewed as 'Crisis' in Latest Poll (Jon Cohen and Jennifer Agiesta, 9/30/08, Washington Post)
Most Americans see the current financial situation as a "crisis," and there is overwhelming concern that the failure of the House of Representatives to pass the economic recovery package will deepen the problem, according to a new Washington Post-ABC News poll.But the poll also revealed significant public concern with the bill Congress rejected yesterday, as few voters said the package did enough to protect "ordinary Americans," and nearly half said it did not go far enough to shore up the nation's economy.
Nevertheless, nearly nine in 10 expressed concern that the failure of the bill could lead to a more severe economic decline, including a slim majority calling themselves "very worried." High levels of concern cross party lines, but Democrats and Republicans have contrasting views of the urgency of the situation. In the poll, 60 percent of Democrats call the economic woes a crisis, compared with 44 percent of Republicans. [...]
Asked to assess responsibility for the legislation's failure, 44 percent said Republicans were the reason, 21 percent said the Democrats and 17 percent said both sides were responsible.
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Vote casts shadow on McCain, Obama (BEN SMITH & GLENN THRUSH, 9/30/08, Politico)
Reluctant Republicans ignored Sen. John McCain, undermining the Republican presidential nominee’s efforts to cast himself as a problem-solving legislative leader. [...] It was the House Republicans, whose support McCain had returned to Washington to seek, who drove a stake through the bill’s heart: Two-thirds of the Republicans voted against the bill; nearly two-thirds of the Democrats voted for it.The failure to pass the measure, and the commensurate historic drop in stock prices around the world, overshadowed the presidential campaign, as it has for a week, and swamped McCain’s attempts to turn the conversation toward a more general argument about taxes and spending. The election remains squarely situated on the economy, turf on which polls suggest McCain is far less trusted than Obama.
I think the election of Barack Obama has not been cinched, but that the Democratic ticket's chances are vastly enhanced. It is a melancholy thought. I share it with reluctance.If I correctly read human nature, I see my fellow Americans as ready for a brand-new version of the same-old same-old. I see them ready, that is, for "change." For anything but news accounts about the crash of companies and the shredding of retirement accounts and stock portfolios.
The most sensible editorial page on the planet, the Wall Street Journal's, saw the bailout bill as generally, under the anguished circumstances, OK. That gave some hope. Yet the House went ahead and shot the thing down. I have the sense that Americans, whatever their view of the proposed bailout, are sick of the whole sideshow.
In Conversation: Woody Allen: New York’s hometown auteur on whether a lifetime of psychoanalysis has paid off, and why kids from Yale no longer like good movies. (Adam Moss, Sep 28, 2008, New York)
NY: Do you have a theory about why the culture keeps getting coarser?WA: The country has, over the years, moved to the right. And it’s possible that accompanying that move to the right, you also get a lessening of taste. But I don’t know if what I’m saying is true, because I have shown some very good films—Bergman, Fellini—to kids from good schools like Yale. Bright kids. And they were not impressed. You know, it wasn’t as though I picked out some kid from the Midwest who’s a churchgoing barbarian.
The interesting thing to consider as you watch Friend Ed Driscoll is whether Bonnie and Clyde hasn't become the Right's ur-text this week, as they act out against bankers and newly bourgeois homeowners.
Why the US is losing in Afghanistan (Anthony H Cordesman, 10/01/08, Asia Times)
The problem is not simply US troop levels. It is dealing with a failure to create anything like an effective overall strategy to fight the war, if strategy is defined as a requiring a practical plan to implement and the resources to act.Afghanistan is larger than Iraq, has a larger population, has far more difficult terrain to fight in, and has a virtual enemy sanctuary in Pakistan on its eastern and southern borders. It is also a nation which has never had a cohesive government and whose governmental structure was in war or near chaos over two decades before the US invasion. It also never had a military or police force that was more than a fraction the size of Iraq, and had no modern national military forces after 1993.
While there are no reliable statistics on either country, the CIA data provide as good a rough estimate as any. Moreover, many of these numbers show just how much more serious the nation building challenge is in a country that has never moved towards major economic development in the past, and that Afghanistan faces ethnic, sectarian, and linguistic divisions at least as serious as those in Iraq.
While there are no reliable estimates of the size of Taliban-HI-Haqqani forces in Afghanistan relative to the size of al-Qaeda in Iraq and its affiliates, the background briefings given by various intelligence organizations indicate that the insurgent threat to Afghanistan - core cadres (the guesstimate of 10,000 is often used for both wars), part time fighters, and associated supporters - is probably at least as large as the insurgent threat in Iraq.
Recent background briefs also indicate that there are now significantly more foreign fighters involved in the insurgency in Afghanistan than the insurgency in Iraq, although numbers vary so much from estimate to estimate that it is impossible to provide even a reasonable range of numbers.
A comparison of the cost to date of the Afghan and Iraq Wars, however, reflects the same comparative lack of resources that is reflected in troop levels and in aid personnel. In spite of significant allied contributions, the Afghan War has so far received less outside funding than the Iraq War, and has had fewer combat troops than were committed to the Coalition forces in Iraq at their peak.
Afghanistan is also a far poorer country, had no savings and capital resources to draw upon once the initial fighting war over, and not oil exports or other economic activity capable of funding the basic needs of its population, much less funding development and strong national security forces.
The tank isn't empty: a review off The Myth of the Oil Crisis: Overcoming the Challenges of Depletion, Geopolitics, and Global Warming By Robin D. Mills (Steven Martinovich, September 29, 2008, Enter Stage Right)
The peak oil argument largely stems the prediction made by Hubbert in 1956 that American peak oil production would take place in 1970. The problem with Hubbert's methodology is that it has only ever been proven correct that one time. His succeeding predictions, including that the world would hit peak oil production in 1995, have been uniformly wrong. That hasn't stopped his acolytes from continuing to promote the notion that we are in imminent danger of running out of oil.Mills, a petroleum economics manager for the Emirates National Oil Company in Dubai, argues that peak oil advocates have long underestimated the amount of estimated and proven reserves and that exploration has largely keeping pace with production when necessary. The recent rise in oil prices doesn't reflect scarcer resources but underinvestment on the supply side and global economic growth on the demand side.
To support his argument Mills carefully surveys the world's oil producers and analyzes their past, present and predicted future output. Unlike peak oil advocates, Mills generally takes a guardedly optimistic view and argues that many nations have untapped resources that haven't been exploited for various reasons which include economics, technical and environmental, or that they simply aren't needed at the moment.
From there Mills examines what he refers to as "unconventional oil", oil that is derived from deep sea drilling, the arctic and shale, among other sources. He estimates reserves as high as a trillion barrels of oil, more than enough to keep the global economy moving for decades. Mills also looks at the role that alternative fuels will likely play in lessening oil use and acting as a cushion for the inevitable day when we transition from an oil-based economy.
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-EXCERPT: from Myth of the Oil Crisis
The current high prices certainly seem to give some credibility to the idea that we are approaching some fundamental limit of oil resources. But we should remember how we arrived at this situation, since the culprit is not constraints on oil in the ground: it is the long 1986-98 period of low prices and under-investment. Low prices decimated the oil industry, while the rise of energy-hungry new powers in Asia, combined with robust demand in the developed world and geopolitical upsets in major producers, stealthily ate up spare production capacity. The inevitable result, perhaps amplified by ‘speculation’ and market nervousness, has been a so-far inexorable rise in the oil price.This price rise is not driven, then, primarily by geology. But many commentators outside the energy business, and some within it, believe high oil prices vindicate their often-repeated claims that ‘peak oil’ is imminent. Supporters of this view point to the work of the American geologist M. King Hubbert, whose seminal 1956 paper prophesied a peak in US output by 1965-1970 (the actual year was 1970), a success often taken to prove that oil depletion must follow ‘Hubbert’s Curve’. Yet when applied to other countries, ‘Hubbert’s Curve’ and its variants are at best approximately right, but frequently wildly wrong.
Predictions of the date of ‘peak oil’ require some estimate of the amount of oil reserves known today, and the quantity to be found in the future. Believers in imminent depletion state that global reserves, particularly in the OPEC countries, are heavily over-stated, that exploration success is falling well short of replacing production, and that technology does not unlock significant new oil. These assumptions imply that we are on the cusp of producing half of our ultimate total of oil. Hubbert’s method therefore predicts imminent decline.
Although a few countries may be over-estimating their reserves, comprehensive industry databases suggest that, if anything, the aggregate official figures are somewhat low. OPEC’s upgrades in the mid-1980s are mostly reasonable given prior conservatism, exploration success and advances in technology. Lack of recent exploration success is due to limited effort during the low-price era, and to restrictions on access to promising areas like major OPEC countries, Russia and the US offshore. In any case, huge recent discoveries in areas like deepwater Brazil confound the pessimists. ‘Reserves growth’ is a real and major phenomenon in many major oil regions, not an artefact of conservative reporting – the best place to look for new oil is in oil fields, with fresh ideas and methods.
‘Unconventional’ oil is becoming conventional, and making up a growing proportion of supply. Output from the famous ‘oil sands’ of Canada is growing rapidly; heavy oil all around the world is attracting new attention, from the UK to Russia to Saudi Arabia to Congo. Liquid fuels can be made from abundant coal and gas. ‘Second generation’ biofuels, from non-food crops, promise to overcome the problems of rising food prices, while the trillions of barrels in oil shales may be on the verge of being unlocked. And a wide swathe of oil demand can be substituted by abundant natural gas, which, even more than oil, is nowhere near ‘peak’, and which emits much less carbon dioxide.
Nor is geopolitics the insuperable threat it is made out to be. The abundance and geographic dispersal of unconventional oil and other energy sources renders a long-term oil embargo self-destructive. Nor is the Middle East rabidly hostile to the West and keen to wield the ‘oil weapon’, despite xenophobic claims. Modern ‘resource wars’ cannot pay for themselves, as the Iran-Iraq war and the recent Iraq conflict amply demonstrate. Terrorism is not capable of disrupting the long-term energy picture – as long as it does not provoke its victims into ill-conceived retaliation. The military, practical and political difficulties of blocking the ‘choke-points’ of international oil trade are widely under-estimated. ‘Energy independence’ cannot be attained at acceptable cost by any large consuming or producing nation. Retreats into paranoid self-sufficiency threaten a re-run of the grim 1930s; energy security can only be achieved, or at least improved, by a balance between the needs of exporters and importers, and a web of mutual inter-dependency.
Even the serious environmental problems associated with fossil fuel extraction and use, particularly some unconventional sources, can be tackled by new technologies, incentivised by policies to make the ‘polluter pay’. The environmental impact of modern oil extraction, even in sensitive areas such as offshore or in the Arctic, is much less than generally imagined. The very real threat of climate change requires a portfolio of solutions. A key one is ‘carbon sequestration’, the locking away of carbon dioxide in underground reservoirs, a method that can also liberate additional oil and gas. Despite claims to the contrary, all the components of carbon sequestration are proven; they need only to be put together on a large, repeatable scale.
Energy efficiency and renewable energy are key components of the fight against both climate change and the phantom of oil depletion. A growing economy and living standards would be possible even in the face of declining oil use. ‘Neo-Luddite’ calls for the end of industrial civilization are, if taken seriously, both naïve and apocalyptic. In this sense, oil will never ‘run out’; it will be replaced by something better. That is
The Darwinian Basis for Eugenics: a review of Darwin Day in America. By John G. West (Anne Barbeau Gardiner. September 2008, New Oxford Review)
Darwinists are always trying to set a distance between the theory of evolution and the eugenics movement, but West cites Darwin, in The Descent, as approving of how "the weak in body or mind are soon eliminated" among "savages," and disapproving of how civilized men "build asylums for the imbecile, the maimed, and the sick," with the result that "the weak members of civilized societies propagate their kind." Then, comparing man to livestock, Darwin added, "no one who has attended to the breeding of domestic animals will doubt that this must be highly injurious to the race of man." After this statement, he gave lip service to compassion for the weak, but the implication remained that such compassion undercut the survival of the human race. Darwin again complained about how "the reckless, degraded, and often vicious members of society, tend to increase at a quicker rate than the provident and generally virtuous members." He would return to this point in his last conversations with Alfred Russel Wallace, speaking "very gloomily on the future of humanity" because "in our modern civilization natural selection had no play, and the fittest did not survive." (Although Herbert Spencer coined the phrase "survival of the fittest," Darwin readily appropriated it as an "accurate" description of natural selection.) The Darwinian basis for eugenics is often downplayed, West observes, yet it is a fact that eugenicists drew their "inspiration" directly from Darwinian biology. A number of the chief eugenicists of the early 20th century declared that natural selection was the "law" they followed to improve the race. Moreover, the American leaders in eugenics, who were "largely university-trained biologists and doctors" affiliated with places like Harvard, Princeton, Columbia, Stanford, and the Museum of Natural History, presented eugenics as biologically "justified." Between 1920 and 1939, West shows, Darwin's theory was constantly used in high-school biology textbooks to support eugenics, something that shows how much mainstream science accepted this form of population control. The book that Darwinist schoolteacher John Scopes was using in his Tennessee high-school classroom before his infamous "Monkey Trial" was G.W. Hunter's Civil Biology (1914), which followed the trend of advocating eugenics on Darwinian grounds. There Hunter spoke of "parasites" in society who, if they "were lower animals, we would probably kill them off to prevent them from spreading."Scholars today place the blame for the eugenics debacle on politicians, but West finds it more accurate to describe the movement as "an effort by scientists to dictate government social policy based on their presumed scientific expertise." This was the first time they used science "to expand the power of the state over social matters."
Scholars also turn a blind eye to the argument for racism that eugenicists drew from The Descent. Darwin there claimed that the break between apes and man in evolution fell "between the negro or Australian and the gorilla." West argues that Darwin's allegation about blacks belonging to "a more primitive stage of human evolution" soon became a powerful scientific rationale for racist public policies, including laws against miscegenation.
The effect of Darwinian materialism on criminal law was deadly too. In 1876, Italian criminologist Cesare Lombroso argued that criminals were a "throwback to earlier stages of Darwinian evolution," and in 1924 Clarence Darrow argued (in defense of Leopold and Loeb) that criminals were "programmed for crime by material forces over which they had no control." Since eugenicists believed that criminal tendencies were inherited, they strove to curtail the breeding of groups that produced criminals. By the early 1930s, thirty states in the U.S. had sterilization laws, and by 1958, around 60,000 Americans had been sterilized, many by coercion. When Oliver Wendell Holmes, a Supreme Court Justice, approved of Virginia's forced-sterilization law, he said it was the way to "build a race." Later, when Nazis forcibly sterilized the "unfit" in the 1930s, they claimed to be acting, like us, on "biological principles." Hitler even declared that he had studied the laws of several American states for the sterilization of people whose breeding was "injurious to the racial stock."
After eugenics was discredited by Nazi use, leading American eugenicists turned to contraception and abortion for population control. In 1953 they issued a document entitled "Freedom of Choice for Parenthood: A Program of Positive Eugenics," in which they linked so-called "voluntary parenthood" to natural selection. The tactics were new, the principles the same: West cites Alexander Sanger, grandson of Margaret, as making a Darwinian defense of abortion in 2004, asserting that "abortion is good," and "we must become proud that we have taken control of our reproduction. This has been a major factor in advancing human evolution and survival."
David Cameron vows to avoid US-style deadlock in dealing with economic crisis: Tory leader vows to put party politics aside as he unveils three-point plan to protect UK from fallout (Deborah Summers, 9/30/08, guardian.co.uk)
"We can't allow what happened in America to happen here," the Conservative leader said, as he pledged to work with the government to bring stability to the financial crisis.In an emergency statement to the Conservative party conference in Birmingham, Cameron vowed put party politics aside as he unveiled a three-point plan to protect Britain from the worst of the economic fallout.
"This is a moment when democracies are being tested," Cameron said. "We need to show that we can deal with crisis."