TSA Workers Hospitalized…

… after sniffing honey. They also spent most of the day hassling “gardener Francisco Ramirez”:

The TSA shut down Meadows Field airport (BFL) in Bakersfield, CA, on Wednesday after several bottles of honey set off explosive detection monitors. Two TSA agents were also taken to the hospital after smelling the then-unknown substance and feeling nauseated.

Hard to know whether to file this under excessive government spending, loss of civil liberties (nearly full day detention due to carrying honey), or runaway health care costs (I’m still sad that nobody likes my health care reform plan).

More: aero-news.net.

Related: older posting on how we’re spending $6 billion per year on airport security.

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Visit to Berkeley, California

Here’s a trip report on four days spent in the East Bay (Berkeley, Oakland, Piedmont), primarily with people who work or study at the University of California, Berkeley and people who have high-tech jobs.

Bitterness against Republicans in general and King Bush II in particular is commonly expressed. We tried to go over to the Berkeley Art Museum to see paintings recently given to the museum by Fernando Botero: The Abu Ghraib series. Unfortunately the museum was closed along with every other University of California building, due to lack of funds. Whose fault is that? According to all of the East Bayers with whom I spoke, the Republican-sponsored Proposition 13 is to blame. Ever since this initiative passed in 1978, the state has been starved for funds. I pointed out that California collects a larger percentage of its citizens’ income than all but five other states (10.5 percent; source). Shouldn’t it be possible to run the state on 10.5 percent of income?

Despite the fact that all of my interlocutors had university educations, sometimes including PhDs, all were so deeply invested in the idea that their insolvent state government is starved for revenue that they were unable to parse the information. They all replied that of course California needed more money than the average state because it had a larger population, thinking that I had said California collected more total dollars than all but five other states. None could accept the idea that their state had a spending problem rather than a revenue problem and everyone thought that more money should be collected “from rich people” (these folks, if only by virtue of owning houses in Berkeley, were rich by American standards, but they defined “rich” as “more than $50 million in assets”; nobody considered the idea that wealthy people could easily pick up and move to states with lower taxes). None would accept the idea that their state and local government were no longer there to serve current citizens, that they existed primarily to pay pension obligations incurred decades earlier (more).

For roughly 60 years, Berkeley has offered more services to its residents than virtually any other city in the U.S. The schools are expensively funded. Welfare programs have been lavish. People can borrow a full set of tools from the public library. There is a non-profit organization on every block. Yet Berkeley has a poverty rate of 21 percent, higher than the state average of 12 percent (source). The school system tracks student performance by race and ethnicity so that they can reveal to local employers that “white students are doing far better than the state average while black and Latino students are doing worse” (source). Anywhere else in the country one would be considered a vicious racist for claiming that black and Latino high school students are intellectually inferior to white and Asian students, but in Berkeley broadcasting this information marks one as a concerned humanitarian. Sixty years of failure had not daunted any of the East Bayers with whom I spoke; all were in favor of even bigger and more expensive government.

Given the cheerleading for government expansion, I would have thought that the latest $1 trillion health care spending initiative in Congress would have delighted Berkeleyites. “The Republicans gutted the bill,” one woman said, “by removing the public option. So it isn’t a fair test of what government could do.” How about the ascendancy of Barack Obama, which should give the U.S. eight years of the kind of political philosophy that Berkeley folks have espoused for decades. “He’s a moderate, not a liberal,” was the response. Thus if the extra trillions of dollars in borrowing and spending and eight years of Barack Obama does not usher in prosperity, the fault is that Obama and Congress did not grow the government’s share of GDP sufficiently.

Big government is working reasonably well for a U.C. Berkeley scientist who received $250,000 in stimulus money for scientific research. He explained “I’m going to spend all of it in Europe and Japan; I’m stimulating the global economy.”

When not pointing out the evilness of Republicans and the idiocy of Americans who vote for them, my Berkeley friends turned their attention to denouncing the second largest force for evil in the world: Israel. Due to the state-wide out-of-money shutdown, there was no chance of a West Bank checkpoint on the U.C. campus (http://calsjp.org/ has the schedule for these), but the rest of the anti-Israel industry was up and running. I asked folks whether they couldn’t at least admire the Israeli health care system, which provides universal coverage (not leaving millions of people out, like our new one) and superb results, all at a cost close to what a Golden Retriever owner would pay here for high quality vet care. The response was that apparent Israeli achievements are not due to hard work by Israelis, but are a result of rich Jews in the U.S. sending so much money to Israel (this study reveals that the total amounts to roughly 0.4 percent of Israel’s GDP; if withdrawn, each employed Israeli would have to work one additional day per year). I wondered aloud whether Americans didn’t have it even easier, with our near-infinite supply of natural resources. We’ve had free land, free water, oil, minerals, etc., all from the big plot of land that we stole from the Indians. Aren’t we Americans the ones who have been enjoying a 400-year tailwind? (A tailwind that is a lot less powerful now that we’ve expanded the population to 300 million and sucked many of the resources dry.) Nope. It was the Jews who got the unfairly good deal.

Berkeley students and faculty have recently been protesting tuition and fee hikes, but there haven’t been any protests about government borrowing and spending. Depending on your assumptions about how long pensioned government employees will live, wages in the U.S., and investment returns, it is quite possible that a Berkeley graduate who stays in California will find that local, state, and federal governments have already spent 80 percent of his lifetime earnings. Students aren’t protesting increased government spending or advocating any cuts, however, but only demanding more spending on their parochial concerns. Neither are East Bay parents complaining about government spending; they are dealing with the risk of a future U.S. economic collapse by getting foreign passports for their children. [Parenting in Berkeley can be a little more creative than in the rest of the U.S. One family invited me to share a meal with their “dinner co-op” partners, another family with a kid about the same age. They trade off cooking dinner every Monday evening. “By the way,” my friend noted, “there are two mommies in this other family.”]

I had breakfast with two white males. One founded a mobile phone tech company and mentioned that they are soon to go public. He is already pretty rich but stands to make tens of millions of dollars in the IPO. Our entrepreneur grew up in the U.S., attended the best private schools, and then went on to the most elite universities. His family happens to come from Argentina. I asked the other white male at the table, a wage slave for a big company, how he would feel if his own daughter were rejected from college in favor of the rich entrepreneur’s kid, due to that child’s Hispanic status. This turned out not to be a tough question. Of course he wanted his daughter to go to the most prestigious school, but Affirmative Action was important and his own daughter would surely get into at least some college somewhere. So on balance he thought it would be fair for his daughter to be rejected.

I met a friend picking up his laptop from an independent Macintosh repair store, with lower prices than the official sleek Apple stores. A minor whack had caused the power connector to fail internally. His love for the Mac was not diminished when I pointed out that the repair bill was about the same as what Dell charged for a brand new computer. The other Macintosh experience that I had was trying to use a Flip video camera with an iMac (vastly inferior user experience) and listening to the owner talk about how much easier to use and more reliable the Macintosh was than Windows. The only problem that he’d had with his machine recently was the loss of three months of data: all writing, photos, and video.

After the Macintosh repair shop, we stopped into the Brower Center, which calls itself “Berkeley’s greenest building” and is packed with non-profit organizations that are determined to stop stupid people in the rest of the U.S. from trashing the planet. The building is named for David Brower, famous for being pushed out of the Sierra Club when he pointed out that immigration was going to ruin the environment of the U.S. (more). In 2000, Brower thought that the U.S. would be a pleasant place to live with 150 million people (what we had around 1950) and an unpleasant place with the 600 million that we were forecast to have by 2100. As of 2008, the experts were forecasting a 2100 population closer to 1 billion (source). Brower’s legacy is a building featuring a cavernous two-story atrium and high ceilings everywhere. On a day with temperatures of about 55 degrees outside, the environmentalists’ building was heated to more than 80 degrees. We stripped off all of the clothes that we could.

At a CVS in Oakland, we bought sundries from a 70-year-old working as a cashier. I asked my local companion if he thought it was moral for the government to tax this poor old working person and hand the money over to a comfortable 50-year-old retired former public employee, which is essentially how California is now set up. He had not thought about the question.

A white man told me how proud he was of his year-long dialog with an angry young black student back when he was an undergraduate at an Ivy League university. “When we first met,” he said, “I said that he should admit that we were mostly alike, despite our difference in skin color. He replied that there was no way that I could understand the rage of a black man. We spent a whole year working this out and I came to understand his point of view.” My response was that perhaps his first idea was correct. Could it be that black and white Americans are mostly alike? We spend our time talking about skin tone while the Chinese grow their economy at 9 percent per year.

One nice thing about living in Berkeley is that you can be sure that God agrees with whatever you’re thinking. If God didn’t agree with and love you, why would would He pour down good weather and sunshine on Berkeley almost every day?

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Next on my reading list: It Takes a Pillage

I’m starting It Takes a Pillage: Behind the Bailouts, Bonuses, and Backroom Deals from Washington to Wall Street by Nomi Prins. I hope to write up a review when I’m finished, but in the meantime perhaps we can get a virtual book club going with comments on this post. If you’ve got a favorite section of the book or you can relate it to a more recent news event, please add a comment here.

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Whole Foods in the New Yorker

If you’ve spent way too much money on free-range carrots at Whole Paycheck, you’ll be interested to read this New Yorker article on John Mackey, the co-founder and CEO. Mackey was last in the news for opposing Congress’s $1 trillion health care bonfire, leading off a Wall Street Journal op-ed with “The problem with socialism is that eventually you run out of other people’s money.” Despite Mackey’s lack of fondness for socialism, he does not practice modern American-style corporate capitalism, i.e., paying all of the profits to executives rather than public shareholders. The company is run with a 19:1 maximum ratio in salary between the highest paid employees and the average.

Whole Foods is strictly non-union, according to the article: “Unions have picketed store openings and, as activist investors in Whole Foods stock, have called for Mackey’s firing.” Mackey is famous for having said “The union is like having herpes. It doesn’t kill you, but it’s unpleasant and inconvenient, and it stops a lot of people from becoming your lover.”

Though rich, Mackey does not have an Al Gore-size energy footprint. He eats vegan, “flies commercial and drives a Honda Civic hybrid”. The article describes various spiritual movements to which he has subscribed; his wife of eighteen years is currently a Sufi Muslim (Sufism is very important in Afghanistan as well). They have no children. Mackey is an expert on ultralight backpacking, having reduced his non-food kit to 7 lbs. and hiked the entire Appalachian Trail during a 5-month sabbatical in 2001.

More: read the article.

Disclaimer: I deleted Whole Foods from my car GPS during the Crash of 2008; now I shop at Costco.

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The Vagrants, by Yiyun Li

Recommended reading: The Vagrants by Yiyun Li.

The novel is a great display of the writer’s craft, as Li introduces a large cast of three-dimensional characters with remarkably few words. The novel is also timely, dealing as it does with the question of how pragmatic parents are to cope with a child who becomes carried away by words or a philosophy and is ready to sacrifice him or herself to a cause. (See Umar Farouk Abdulmutallab and his father.)

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Does the Flip video camera work with Apple Macintosh?

I’m staying at a cousin’s house in Oakland, California. He considers himself to be incapable of administering computers, so he purchased two iMacs and makes periodic trips back to the Apple store whenever data have been lost. Currently one of the two machines is in working order and I tried to use it with my Flip HD camcorder to share a little video of one of his daughters. My previous experience with the Flip has mostly been plugging it into a $399 Windows Vista laptop. On the Mac, I had a lot of trouble plugging the camcorder in mechanically. The design of the Apple keyboard physically obstructs the connector so that it is impossible to plug the camcorder into the keyboard’s USB port. The USB ports on the back are angled downwards, which means that gravity has a much better chance of pulling the camcorder out of the machine (remember that that Flip has a rigid USB connector that ends up supporting the whole camcorder, rather than an accessory cable). By holding the camcorder up to the back of the iMac, I managed to get it plugged in. On a Windows machine, I would be done. I would be prompted to install the Flipshare software off the camcorder onto the PC. After clicking “yes” the software would come up and show the videos on the camcorder, with editing and sharing options. With the Macintosh, I get a confusing dialog box asking if I want to use iPhoto to view “pictures” from my “camera”. After I said “no”, iPhoto came up anyway. After I killed it, no option to install Flipshare was presented.

Do people use the Flip with the iMac? If so, how?

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College that teaches one course at a time

In 1999, I designed a one-year post-baccalaureate computer science program, so that an English major could get a job as a software developer in the then-booming tech industry. One feature that I thought was innovative was that we would teach one course per month, rather than asking students to juggle multiple simultaneous courses. Just today I discovered that this system was adopted in 1978 by Cornell College in Iowa. It is apparently working well for them, since they have not returned to the conventional system.

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Looking back at 2009

Looking back at Year 2009, I think the biggest question that Americans grappled with was what kind of economic system would be best. Whatever system prevailed through 2008 (see below for my characterization) was obviously flawed. Just as in the Great Depression, this opened the door to considerations of alternatives.

What’s on the table right now?

Option 1: Planned Economy or “Trying to cheat our way out of recession”. If the housing market is soft, the government will guarantee all of the mortgages that are being issued to people who buy houses. If the housing market is still soft, the government will lower interest rates on those mortgages. If the housing market still won’t obey, the government will give outright tax credits to people who buy houses. If companies don’t think that they can afford to hire additional Americans given current wages, regulations, and taxes, we will first have the President cajole them into doing so. If that doesn’t work, we’ll have tax credits for companies that hire Americans. If people don’t want to buy GM and Chrysler cars, we’ll give them a $4,000 credit toward the purchase. When that isn’t sufficient, we’ll have the taxpayers buy GM and Chrysler. Obama and Congress will successively turn their attention to each sagging square of the American economic quilt and sew in $100 bills as reinforcements. When the market gives you an answer that you don’t like (e.g., that a house on the outskirts of Las Vegas isn’t worth much), declare that the market has failed and send in the government.

Option 2: 1970s-style regulation. Prior to the Ford Administration, the U.S. economy was heavily regulated, mostly for the benefit of incumbent companies. You’d need Department of Transportation approval to offer trucking or airline services, for example, and you’d have to do it at prices set by government regulators. Folks believe that they’ve seen the destructive effects of a free market and therefore that the government needs to step in with a heavier foot, starting with Wall Street.

Option 3: Faith in a charismatic leader. “Obama is so smart, I have faith in anything that he does,” is how one of my Cambridge neighbors described her feelings recently.

Option 4: Parliamentarianism. Give one party control of both legislature and executive and let them make major changes. This is how things work in most other Western countries, but the American system has been to keep power fragmented. Oftentimes we vote different parties into executive and legislative branches. Even when one party controls both Congress and the White House, parochial concerns have typically kept anything significant from being changed. We have elected a Representative or Senator not to push forward a grand Party agenda, but rather to bring a pork barrel project home to our town. The big push to pass a 2000-page $1 trillion health care bill that nobody had read or understood was an example of parliamentarianism at work and it was a shocking and surprising process to many.

As in the Great Depression, one thing that very few Americans seem to have faith in is market economics. The system that prevailed prior to 2009 was supposedly “free market capitalism” and we now know that it doesn’t work. Limiting ourselves to just those things that directly relate to the Crash of 2008-?, let’s consider what we actually had:

  • laws and regulations preventing shareholders from nominating board members for public companies (enabling the CEO and other managers to pack the board with golfing buddies and then work together to loot from the shareholders); recall that nearly all of the Wall Street firms that blew up were public companies rather than the traditional partnerships
  • laws and regulations giving an oligopoly to a handful of ratings agencies such as Moody’s (the guys who were paid by bond issuers to rate their sub-prime mortgage collections as AAA)
  • policies encouraging banks to issue mortgages to people who were poor credit risks (Fannie Mae relaxed its own credit standards in 1999, on the Clinton Adminstration’s theory that it would help minorities and the poor; banks collected big fees for issuing mortgages to people who would never make payments and then stuck Fannie Mae with all of the risk (and then Fannie Mae blew up and the taxpayers were stuck with the losses (after Fannie Mae executives had taken billions of dollars home in salary))

People close to or favored by the government were able to make enormous amounts of money without taking any personal risk. That’s not a classical free market (in which investors can expect no more than a normal return on investment, after adjusting for risk). That is crony capitalism.

Where can we see a free market operating in order to evaluate whether it was a workable economic system? Due to the enormous size and power of governments worldwide, it seems almost impossible to find a truly free economy. In almost any country one could make a better return on investment by cozying up to a government official or collecting subsidies than by taking risks. The free market, however, does operate internationally. If you are sailing around in a freighter and want to buy sugar, you’ll buy it wherever it is cheapest without any incentives from or intervention by the U.N. If you’re sailing around in a freighter full of cash and want to invest it, there is no international tax system encouraging you to put the money in a particular place or industry. Does the free market work? Commodities by and large seem to be pretty cheap and efficiently produced. Capital flows to support rapid growth in China, Brazil, India, and other countries whose mix of education, costs, stability, and regulation are attractive. Why wouldn’t this free market system work domestically for the U.S.?

Perhaps when government grows beyond a certain percentage of the economy it is no longer possible to have a market economy. Federal spending in the U.S. right now is more than $3 trillion annually. A handful of senators on a single committee can direct a healthy slice of that $3 trillion wherever they choose. It shouldn’t therefore be a surprise that economists found political lobbying to yield the highest return on investment of anything that American companies did. (Lobbying need not result in direct government payments to be profitable; consider the Detroit automakers getting one line inserted into federal regulations, a 25 percent tariff on light trucks starting back in 1963.)

When federal, state, and local government constitute 40 percent of GDP, and the political system is open to lobbying, perhaps pretending that we can have anything resembling a free market is a mistake. Those of us who took Econ 101 are prejudiced against planned economies, but perhaps a Soviet-style planned economy is more efficient than a crony capitalist system.

In my opinion, this is the big question that we’re going to be working out as a society during the coming decade.

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Get out in the snow with your Canon digital SLR

Here’s a bit of inspiration: http://canonfieldreviews.com/7d-1-weather-sealing/ (guy subjected Canon 7D and 5D Mk II bodies to a lot of water/snow abuse and they survived (Canon doesn’t guarantee rainproofing except for its professional 1D bodies, which are the same price and weight as a Hyundai sedan)).

So don’t let the cold weather, snow, slush, and freezing rain keep you from getting out. I will be cheering you on from my friend’s house here in Napa, California!

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