Failed London Multi-Car Bombing Does Appear Al Qaeda-Linked
Barot's known associate who's thought to have been involved in today's martyrdom-interrupted isn't yet in custody, but we have London's famous superfluity of security cameras to thank for the "crystal clear" picture of the would-be bomber that enabled the bobbies to ID him.
Philly Mayor: Closet Mac Fanboy? Or Just Sick Of His Job?
If you're reading this on a hand-held device while camped outside an Apple store, you're likely taking a personal day, on summer vacation, unemployed, employed by a boss who's as big a Macaphile as you, or just taking the opportunity to exercise your man-sticking-it-to muscle by playing hooky. One way or another, you're likely either truant in some way or you've got nothing better to do.
Which one is Philadelphia Mayor John Street?
Mayor John F. Street abruptly ended his wait in line for an iPhone Friday after a passer-by asked him about the city's murder rate.
Street, who showed up outside an AT&T store at 3:30 a.m., left shortly after a 22-year-old sporting a mohawk asked him, "How can you sit here with 200 murders in the city already?" The Philadelphia Inquirer reported on its Web site.
Street told the man: "I'm doing my job," the newspaper said.
Street had planned to stay in line for most of the day, waiting for Apple Inc.'s iPhone to go on sale at 6 p.m. When he left at 11:30 a.m., Street said he planned to return to his spot.
Eight hours Street stood in that line. Pretty impressive for a man in his mid-60s. For the first several, of course, he was just robbing himself of sleep. But well before 11:30, the taxpayers' meter started running.
I doubt if the local murder rate crept up due to Street being out of the office this morning (in fact, it might well have fallen, as the city's murder rate only seems to climb with Street in office), but the mohawked chap makes a decent point.
The mayor said he wants the new device because he loves trying out the latest technology. Apple's new handheld would allow him to work some of the day outside the office, he said.
"We don't have to be sitting in City Hall to be conducting city business," he said.
Er, right, but... does the mayor need to be City Hall's iPhone procurement agent? Even if his office's apparently woefully stationary affairs need to be mobilized via iPhone immediately, there's already an insta-cottage industry of people who will wait in line to fetch you your sudden must-have communicator/entertainment device for as little as $250. Is the Mayor's time not worth $17/hour (he hopped in line 14.5 hours before the phones were to go on sale)? If the most productive use of Street's time is simply to occupy space, it might be time for him to shuffle along to less influential pastures. Street will only be "in office" for another few months as it is, so if he's already content to while away his days among the fanboys and professional line-sitters, rather than spend his remaining time in office in his office, maybe it's best just to let him.
And whoever was behind Street when he skulked out of the line this morning, make sure you don't let him cut back in if he makes good on his threat to reclaim his place later today.
Don't It Make This Red Blog *Blue*
Who knew I was being so lewd?
This rating was determined based on the presence of the following words:
- bomb (11x)
- death (3x)
- gay (2x)
- sex (1x)
And to think - I didn't post a thing about the Pentagon's deadly gay sex bomb.
HT: Ace (click with caution, the lout scored an NC-17)
He's Articulate, He's Clean, He's Probably AIDS-Free!
I still maintain that Joe Biden has thus far managed the best single answer in any Presidential debate to date in the 2008 cycle. That one when he responded to a question about whether he can constrain his overly verbose tendencies with a concise "Yes", followed by a crowd-pleasingly silent smile and a raucous response from the audience.
Sadly, Biden doesn't seem to have digested the takeaways from that lesson in self-muzzlery. You'd think the soup in which he landed after his infamous remarks about Barack Obama being the first "articulate and bright and clean" black Presidential candidate would've been enough to condition him to button his lip, lest his penchant for uncouth utterances betray him again. You'd think. But you'd be wrong.
Thursday night's Democratic debate at Howard University offered Biden his latest public forum in which to ply his keen racial diplomacy.
A question about AIDS elicited a few interesting moments.
The candidates were asked about how they would help stop the spread of HIV/AIDS among African-American teenagers, who catch the disease at a disproportionate rate compared with the general teen population.
New York Sen. Hillary Rodham Clinton received loud applause when she said: “If HIV/AIDS were the leading cause of death of white women between the ages of 25 and 34, there would be an outrage outside in this country.”
Delaware Sen. Joseph Biden took a different approach, saying that it was up to people to make smart decisions, like using contraceptives or getting AIDS tests. “I spent last summer going through the black sections of my town holding rallies in parks, trying to get black men to understand it is not unmanly to wear a condom. Getting women to understand they can say no.”
“I got tested for AIDS,” Biden said, before pointing at another candidate. “I know Barack got tested for AIDS. There’s no shame for being tested for AIDS.”
The camera caught Illinois Sen. Barack Obama giving Biden a hard stare (although it seemed pretty mild compared to the glare Biden got from Al Sharpton, who was sitting in the audience).
Yipes. Which is ditrter political pool - Biden standing on Obama's AIDS test or Kerry standing on Cheney's daughter back in 2004?
For my money, Kerry reigns supreme here. After all, the doomed nominee was shamelessly and transparently aiming to drive a wedge into the heart of the Republican base by trying to disparage the opposition's family as conflicting with the base's values. Biden, it would appear, is merely waxing enthusiastic about AIDS in order to glom some attention from a front-runner by calling out an issue on which he thinks they share common ground.
Dirty pool, for sure, but not quite so bold as to be Kerryesque.
There's a Democratic Presidential Debate Tonight?
I know today was a busy news day, what with the second, and God willing final, death of the amnesty bill and the new Fed policy statement, but a Presidential debate is still a sizable bit of newsworthiness to slip through the cracks.
For what it's worth, Ace has a proxy liveblogging on scene.
Update: Debate Part II from Ace's correspondent. Ride the walrus.
Federal Reserve Language Watch
Today, the Fed decided to leave the Fed Funds rate unchanged at 5.25% for the eight consecutive time. Below are the language changes between the May 9th policy statement and today's.
For immediate release
The Federal Open Market Committee decided today to keep its target for the federal funds rate at 5-1/4 percent.
slowed in the first part of this year and theadjustment in the housing sector is ongoing. Nevertheless, theeconomy seems likely to expand at a moderate pace over coming quarters.
Core inflation remains somewhat elevated. Althoughinflation pressures seem likely to moderate over time,the high level of resource utilization has the potential to sustain those pressures.
In these circumstances, the Committee's predominant policy concern remains the risk that inflation will fail to moderate as expected. Future policy adjustments will depend on the evolution of the outlook for both inflation and economic growth, as implied by incoming information.
Voting for the FOMC monetary policy action were: Ben S. Bernanke, Chairman; Timothy F. Geithner, Vice Chairman; Thomas M. Hoenig; Donald L. Kohn; Randall S. Kroszner; Cathy E. Minehan; Frederic S. Mishkin; Michael H. Moskow; William Poole; and Kevin M. Warsh.
The market should like the language adjustments, as they seem to give comfort on both sides of the Fed equation - early 2007 growth gets upgraded from "slowed" to "moderate" (likely a combined effect of the first quarter's anemic growth accounting for a smaller portion of the year-to-date and this morning's slight upward adjustment in the estimate of that quarter's growth). And - more significantly - the committee actually indulged in an uncharacteristically unequivocal statement about inflationary pressures. Namely, that they're easing (albeit, not yet in a convincingly sustained way).
A stable outlook for growth AND easing inflation spells happy times for equity markets, as not only can aggregate corporate profits be expected to remain strong, but the Fed has effectively holstered its weapon for the time being. Maybe it hasn't snapped the holster shut, and maybe its hand is still on the butt of the gun, but it's no longer wielding it quite as menacingly. Of course the FOMC is quick on the draw and could always hike rates unexpectedly if it gets spooked, but this has to be about as benign a statement as the markets could have asked for.
The immediate aftermath saw a bit of the usual whipsawing in the major indices, but no compelling move higher just yet. Most market sectors were moderately higher for the session already, following a few frenetic days on Wall Street.
I'll hazard a guess that we move meaningfully higher in the final 90 minutes of trading.
(In the spirit of full disclosure, I own some front month call options on a company reporting earnings after the bell today, so it's in my interest that market sentiment turn bullish. So please completely disregard everything I've said, insofar as it impacts any investment decision you might be thinking about making.)
Update: No such luck. The markets closed pretty much flat from where they were at 2:30. Most commentators out there seem to have been less overwhelmed by the adjusted inflation language than I and aren't ready to buy into the idea that the Fed is veering dovish. Still, given the Bernanke Fed's typical preference for nearly imperceptible wording changes from meeting to meeting, I still see today's substanatially altered statement as plenty whelming.
Immigration Cloture Fails Big
We needed 40 votes to kibosh the undead, sovereignty-yielding shamnesty bill. Looks like we not only thwarted cloture, but did so with a full-on Senate Majority - 53 votes against, according to a preliminary count.
The final tally should be available here sometime after noon.
Update: Republicans who voted for amnesty:
More Democrats (15) found their way to the anti-amnesty side than did Republicans (12) to the anti-sovereignty side. Of that dirty dozen, only Lindsey Graham is up for re-election in 2008, meaning we ought to see an interesting Senate primary in South Carolina next year.
Among Presidential candidates, Clinton, Obama, Biden, and McCain were all on the losing side. Only second-and-a-half tier candidate Sam Brownback voted on behalf of the American people (though it appears it may have been a last minute change of heart).
Update: Allah has laid out the chronology of the votes, thus separating the principled from the weasly, and finds Brownback's double-back to be the weasliest of all.
Trendy Ethanol Making It Costlier For Americans To Fill Up
America's cornlust is quickly growing insatiable, as we wantonly butcher and process this noble resource into everything from Jiffy Pop to old-timey pipes to gasoline additives (not to mention coked up race tracks). Now, the American consumer is beginning to bear the brunt of our national corn addiction.
Annelena Lobb explains why your next trip to the drive-through window might cost you a little more:
Fast-food ingredients are getting pricier. The culprit, for the most part, is ethanol: As the ethanol boom increases demand for corn, prices for other corn-based products — including animal feed — also gain. The buck gets passed along in prices for animal products like chicken, beef, and cheese.
Cheese prices recently soared to levels not seen since 2004, reaching $2 a pound on average as of June 14 — a 65% increase over the same period last year, wrote Wachovia analyst Jeff Omohundro. That’s bad news for Yum! Brands, the owner of Pizza Hut. Mr. Omohundro lowered his fiscal 2007 earnings estimate on Yum to $3.23 from $3.26 on higher expected food costs.
Of course here in New York, we're not allowed to east fast food, but this must be a real drag out in the uncivilized badlands where people are forced to determine their own diets. Animals.
"Bring Your Son To Jail" Day Enters 737th Day (47 To Go)
It's been just over two years since John Rigas and his son Timothy, respectively the founder and former CFO of Adelphia Cable, were sentenced for their involvement in a massive corporate fraud scheme, and nearly three years since their convictions.
U.S. District Court Judge Leonard Sand had finally had enough and ordered the father and son to report to prison.
"Too much time has elapsed," he said.
Neither the 82-year-old Rigas patriarch nor his 51-year-old son reacted visibly to the judge's order, which had been expected. Both appeared downcast as they hugged relatives in a courthouse hallway after the hearing, and declined to comment to reporters.
A federal appeals court had cleared the way for the pair to begin serving time in May when it upheld all but one count of their convictions on multiple charges of securities fraud, conspiracy to commit bank fraud and bank fraud.
John Rigas was sentenced to 15 years in prison. Timothy Rigas, the company's former chief financial officer, was sentenced to 20 years.
Quick refresher on the Rigas' misdeeds:
Prosecutors at the trial said the Rigases had concealed nearly $2.3 billion in Adelphia debt from stockholders, making the company look good even though its finances had became dangerously overextended.
They were initially convicted in 2004, but their sentencing was delayed for nearly a year while they negotiated with prosecutors over restitution payments to Adelphia stockholders.
Adelphia Communications Corp. was the country's fifth-largest cable television company before its collapse in 2002. At its peak, it served more than 5 million customers in 31 states.
Upon disclosure of the hidden billions of dollars of off-balance-sheet financing in 2002, Adelphia promptly collapsed.
[Prosecutors] also accused the family of using the company as their personal ATM machine, withdrawing millions of dollars to buy everything from 100 pairs of bedroom slippers for Timothy Rigas to more than $3 million to produce a film by John Rigas' daughter. Prosecutors said John Rigas used expensive jets to fly eggs, paper towels, and two Christmas trees to his daughter in New York.
It's no $2 million birthday party on Sardinia with gladiators and chariots and vodka-whizzing ice sculptures, but the Rigas family did know how to squander in style.
Previously: "Bring Your Son To Jail" Day
Special Presidential Combo: Sticky Rice and Virtue Soup
[Massachusetts Secretary of State William] Galvin says the federal Justice Department is pressuring Boston election officials to translate candidates' names into Chinese characters in precincts with prominent Chinese-speaking populations.
But there's more than a little lost in translation, according to Galvin.
Since there's no Chinese character for "Romney," translators have resorted to finding characters that most closely match the sound of each syllable in the name.
So Mitt Romney could be read as "Sticky Rice" or "Uncooked Rice." Fred Thompson might be read as "Virtue Soup."
This Is Your Cornfield
(via HA headlines)
With the next campaign finance disclosure just around the bend, Hillary has recruited Bill to pen her latest solicitation letter. In it, Bill stresses the urgency with which we need to support his wife's campaign, by highlighting some sobering economic data that quantify the terrible suffering wrought by a Clintonless White House.
The fact is, our opponents may very well outraise us -- and we can't afford to lose momentum now.
Not when 45 million Americans are without health care. Not when wages are flat, consumer debt is rising, and children are living in poverty.
Even when they outspent her two-to-one in her Senate campaign, she still came out on top -- in a landslide. And when she ran for reelection, she won almost 60 percent of the votes in New York counties that went for President Bush in 2004. When Republicans saw what she did, instead of what her opponents said about her, they voted for her too.
Bill would also like to remind you that he did not have sexual relations with that woman, that he has never engaged in loan fraud, and that Sandy Berger simply has congenitally sticky fingers.
Let's consider the bald-faced boldface, item by item.
Bubba: "45 million Americans are without health care."
Reality: The Census Bureau estimates 45 million Americans are uninsured, not "without health care". The vast majority of Americans without health insurance still receive medical care.
Bubba: "Wages are flat."
Reality: The annualized growth rate of real (inflation-adjusted) wages has averaged 1.2% over the last twelve months (well ahead of the average pace of 0.8% set during the economic arcadia of the Clinton Administration).
Bubba: "Consumer debt is rising."
Reality: Actually, that's true. Consumer debt is rising. But consumer debt is almost always rising. Consumer debt increased in 95 of the 96 months of the Clinton Presidency. Over those 8 years, consumer debt grew at an average annualized rate of 10.0%. During the Bush Presidency, it has grown at an average rate of only 5.6%.
Bubba: "They outspent her two-to-one in her  Senate campaign."
Reality: Hillary's total disbursements ($41.5 million) in the 2000 Senate race actually exceeded GOP candidate Rick Lazio's ($40.6 million). Maybe Bill was thinking of the 2006 race, which was indeed marked by a staggering spending mismatch. Hillary outspent GOP challenger John Spencer by more than 6-to-1.
Bubba: "When Republicans saw what she did, instead of what her opponents said about her, they voted for her too."
Reality: Despite her incumbency and outspending her challenger by more than 6-to-1, only 20% of New York State Republicans voted for Hillary in 2006. By comparison, 31% of Republicans voted for the non-incumbent Democratic Gubernatorial candidate.
Distortions, exaggerations, and outright falsehoods. Ahh, that takes me right back to '98.
Ronald Reagan Caused 9/11
Just ask Bobby Kennedy.
If we had left those fuel economy standards intact, Ronald Reagan rolled them back, we would not have had to import one drop of oil after 1986. Think of what that would have done to our history. The World Trade Center would probably still be standing. We would have avoided two Gulf Wars. We would be a prosperous nation. We wouldn’t be bound down in this Mesopotamian quagmire that has destroyed our reputation and destroyed the reputation of democracy across the globe.
Better find a new icon to invoke, GOP hopefuls. Turns out the Gipper was little more than an Earth-raping proto-jihadi.
Samson Growing Desperate
With support slipping and war chest dwindling, Johnny Coiffeur is counting on his golden locks to save his flagging Presidential bid.
Arrowhead Ripper: Day 3
The latest on the Battle for Baqubah, courtesy of Michael Yon, who reports that we're continuing to rout the bad guys ("Al Qaeda is about to be strangled and pummeled to death in this town," is how he puts it), notwithstanding what he sees as a serious lack of capable Iraqi commanders in the region.
The combat in Baqubah should soon reach a peak. Al Qaeda seems to have been effectively isolated. The initial attack on 19 June achieved enough surprise that al Qaeda was caught off guard and trapped. They have been beaten back mostly into pockets and are surrounded and will be dealt with. Part of this is actually due to the capability of Strykers. We were able to “attack from the march.” In other words, a huge force drove in from places like Baghdad and quickly locked down Baqubah.
The whole dispatch is worth a read, as real-time coverage of this major military campaign continues to be unavailable anywhere else.
Terror Charges Filed Against Wal-Mart Bomb Threat Suspect
Police have identified the man arrested yesterday and now arraigned on terrorism charges in connection with a string of bomb threats against the Wal-Mart Supercenter in Copperas Cove, Texas.
Gregory Dean Rhodes is named in complaints charging Terroristic Threat.
Bomb threats forced the evacuation of the Cove Wal-Mart Supercenter on Tuesday and Wednesday.
In each case the building was searched, but no explosives were found, police said.
Police are still investigating bomb threats reported on June 7, June 8 and June 16 at the Wal-Mart.
According to the local Killeen Daily Herald, Rhodes is an employee of the McDonald's located inside the Copperas Cove Wal-Mart.
Quote Of the Day
Quoting Allahpundit, quoting Joe Klein, quoting Lt. Col. Bruce Antonia, quoting a Sunni insurgent:
One guy said to me, ‘We fought against you because you invaded our country and you’re infidels. But you treat us with more dignity than al-Qaeda,’ and he said they’d continue to work with us. I’ve been involved in many operations here and this is a first—usually everybody’s shooting at us. This is the first time we’ve had any of them on our side.
Allah has a great round-up of embedded coverage of the first day of the massive and perhaps highly pivotal Operation Arrowhead Ripper, including Michael Yon's latest, whose level of access and quality of coverage continue to astound.
Suspect Nabbed, Following 5 Bomb Threats In 2 Weeks At Texas Wal-Mart
The most benign explanation here is obviously someone (or some group) getting a kick out of making trouble for Wal-Mart, costing them time and money and scaring away customers and employees. A darker possibility would be someone probing Wal-Mart's security protocols and police response times and/or flooding this Supercenter with false alarms to desensitize personnel and local law enforcement ahead of an actual threat (the way a methodical house burglar might deliberately trip your alarm night after night, until you finally shut it off).
COPPERAS COVE – Wal-Mart was again evacuated, this morning, for the fifth time in the past month. Details as to why are still unavailable, but activity had returned to normal by 10:30 a.m.
Police responded Tuesday to the fourth bomb threat reported at the Wal-Mart Supercenter.
The Police Department confirmed that Wal-Mart received a phone call at about 11 a.m. stating that there was an explosive in the building. Customers and employees were evacuated beyond the parking lot perimeter and were not allowed back in until about 2:30 p.m.
The police followed normal procedures in conducting a sweep of the building.
"In the interest of public safety, we do go through the motions every time to keep everyone safe. We evacuate and search the building before giving the all-clear," said Lt. Daniel Austin of the Copperas Cove Police Department.
Wal-Mart has had four reported threats within the past two weeks, but no bombs were found in any of the cases. The first two false alarms were reported on June 7 and 8 at 8 p.m. On each of the consecutive days, the building was evacuated for five hours before an all-clear was given.
If the intent is to desensitize, it may be working. Bizarrely well...
Wal-Mart shoppers and employees are unsettled by the bomb threats but are taking the false alarms in stride.
"It's a big town..."
It's a town of 30,000. [Update: As noted by a local military officer in the comments, Copperas Cove is adjacent to Fort Hood, the only two-division Army base in the country and the largest military base in the world. As it turns out, the Wal-Mart is only a couple hundred feet from the edge of the military reservation.]
"...There are bound to be dangers the larger the town. I'd rather shop here than in Killeen, which is three times the size of us," said Cove resident Rachael Reeves. "Young people are bound to do stupid things. It doesn't really bother me."
The idea of schoolkids being out for the summer and having nothing better to do than scare the townsfolk and waste law enforcement's time isn't that far fetched, but the timing of the threats would well serve someone interested in comparing responses on different days and at different times.
The first two threats occurred on consecutive nights, Thursday and Friday, both at 8 pm. The third call was made the following Friday at 9 am. The fourth came the following Tuesday at 11 am. The next day (yesterday), the fifth threat was made some time around 7 am.
Yesterday morning's call may have been the perpetrator's (or one of the perpetrator's) prompt undoing as police announced they had taken a 29-year-old man into custody late yesterday, in connection with the two most recent threats. No other details seem to be available, but the local NBC affiliate [video] noted that the store has been receiving repeated bomb threats, not just for the last two weeks, but over the past year.
With the cancer-pimping well presumably having run dry, the E'wards campaign is trying something newer fangled in an attempt to top off the candidate's coffers ahead of the looming 2nd quarter campaign finance deadline.
Just 10 days to go until the end of the second quarter and for the men and woman who want to be president that means just one thing: time to step up the fund-raising.
To help boost his total, former Democratic Sen. John Edwards [sic] of North Carolina tonight is planning a novel appeal for money: text-messaging. Around 7 p.m. tonight, about 13,600 people who’ve signed up to receive text messages from his campaign will get a personal appeal for a little donation.
Texting for dollars may seem like a clever way to wring incremental lucre from that younger generation, but in order to offset any convenience or techno-novelty, the campaign has built in a series of lower-tech obstacles to thwart any marginally interested supporters. Step 2...
Supporters who reply to Edwards’s text message will receive a voicemail on their cell phones, in which he asks them to consider donating to his campaign.
In the message, Edwards says: “I’m calling to remind you that with just over a week before the end of the quarter the time to act is now. I’m not asking you to help us out-raise everyone else. I’m only asking you for what we need to get our message of real change out to voters in Iowa, New Hampshire and other key states nationwide.”
Marks who hangs in there this long get to advance to Step 3...
Anyone who decides to take him up on the offer will be directed to a volunteer phone bank, which will be staffed from 7 p.m. until 10 p.m. EDT.
Or Step 3A...
Those who don’t respond before 10 p.m. will be directed to the campaign’s Web site, where the big blue “CONTRIBUTE” link is hard to miss.
Anyone who endures this much hassle to make a contribution (round trip texting, followed by round trip phone calls, followed by possible website referral) without bailing out due to boredom, frustration, or a creeping suspicion that they're being scammed, should be placed immediately on the campaign's list of highest priority fanatical supporters.
Not to be outdone, the Obama campaign is reportedly preparing to kick off a tech-savvy fundraising blitz of its own. Details are sketchy, but from what we hear, registered Obama supporters will receive an e-mail (possibly marked "Urgent") some time tomorrow, which begins as follows:
I am writing to you in strictest confidence and with greatest respect regarding a discreet financial matter of utmost urgency. I am the auditor for the estate of the late Ambassador to Nigeria, whose abandoned overseas assets in the Foreign Remittance Department of the Bank of Hong Kong total US$25 MILLION...
VIP supporters will receive additional e-mails, informing them that their PayPal accounts may have been compromised and that their e-mail addresses have won prizes in an online sweepstakes.
Previously: John E'wards Transmutes Into Healing Evangelist
Another Bombshell Gallup Poll
Previously: 70% of Americans are wrong.
Council of Economic Advisers on Price Gouging Legislation
I've sounded off on the absurd counterproductivity and naked pandering of proposed "price gouging" legislation a number of times in the past (most recently here), so rather than hash through it again as prologue to this white paper published today by the Council of Economic Advisers, I'll just post it in its entirety.
COUNCIL OF ECONOMIC ADVISERS
WASHINGTON, DC 20502
A White Paper on
The Economic Consequences of Gasoline “Price Gouging” Legislation
June 20, 2007
The Nation’s drivers, the Administration, and Members of Congress are rightfully concerned about high gasoline prices and the burden high prices impose on families and businesses, particularly on those low-income households least able to adjust to high prices. All policymakers firmly oppose any anticompetitive practices perpetrated by firms. Any instances of illegal collective anticompetitive action can and should be vigorously fought by the Federal Trade Commission (FTC) and, if criminal conduct is involved, by the Department of Justice.
The problem with this legislation is that terms like “price gouging” and “unconscionable” have no economic definition. As such, there is no economic evidence that can establish or refute claims of gouging or unconscionable behavior. We agree with FTC Chairman Deborah Platt Majoras: the legislation “likely will do consumers more harm than good.”
Legislation like the “Petroleum Consumer Price Gouging Protection Act” as part of S.1419 or H.R. 1252, the “Federal Price Gouging Prevention Act,” will harm the economy generally and specifically will harm drivers – the very people the bills are intended to protect. The approach contradicts standard economic principles.
Such legislation is harmful for primarily two reasons:
1. “Price gouging” legislation that effectively places controls on prices exacerbates shortages and potentially increases lines at gasoline stations.
2. The difficulty in defining “price gouging” would create an unnecessary regulatory regime with potentially high litigation costs and great uncertainty for sellers, enforcement agencies, and the courts. These added costs and uncertainties would deter investment in new supply, increasing prices in the long run.
Supply Disruptions and Lines at Gas Stations
“Price gouging” legislation would reduce incentives to supply areas facing a fuel shortage. For example, in the days after natural disasters, such as hurricanes, price increases induce domestic refineries outside the affected region and foreign suppliers to rapidly ship additional gasoline to affected areas. If this legislation were implemented, it could deter retailers from increasing prices and it might not be worthwhile for suppliers to divert their shipments. Retailers in the affected region would have even less gasoline and drivers would face additional hardship. With gasoline prices kept below market levels, there would be shortages. Consumers would be forced to line up at gas stations, but gasoline would run out before satisfying demand and many would be forced to do without.
Without the flexibility for prices to increase, supply disruptions last longer than they would otherwise. By disrupting the price mechanism, price controls make lines longer during emergencies, misallocate the available supply, and prevent those with the greatest need for gasoline from getting access. Also, by making it illegal for prices to increase when supplies are tight, price gouging legislation makes retailers reluctant to lower prices when supplies are readily available, for fear of not being able to adjust to future supply changes.
It is useful to compare the experiences of the 1970s to the present day. In the 1970s, when price controls were in effect, oil price increases were accompanied by long lines at the pump and economic recession. In recent years with flexible prices, oil price increases of similar magnitude have been accompanied by gasoline availability and strong economic growth.
The legislation would create an unnecessary and costly enforcement regime. Competition between suppliers ensures that they cannot take advantage of consumers by setting prices that are out of line with their cost and ensures that gasoline goes to consumers who need it most.
Existing antitrust law based on economic principles already ensures healthy competition by protecting against anticompetitive business practices both generally and during an emergency. Antitrust law prohibits sellers from explicitly colluding to impose higher prices. Retailers and refiners are prohibited from taking exclusionary actions that would create monopoly power (See the appendix for additional details).
Enforcement of and compliance with price gouging legislation, on the other hand, is costly because price gouging is not well-defined. Firms and regulators therefore would face a great deal of uncertainty, potentially leading to costly and unnecessary litigation. These added uncertainties and costs could deter future investment and increase prices in the long run.
For all of these reasons, “price gouging” legislation should be opposed. Excessive legislation such as this is effectively a price control and would set a bad precedent for the government’s involvement in the market. A wide variety of economists have found with both empirical research and practical experience that these policies do not work. Long experience has shown that allowing the market to set prices—the principle that forms the basis of our Nation’s free-market system—is the most efficient and effective method to allocate scarce resources.
Appendix: Existing Laws already prevent anticompetitive behavior by firms
Competition policy already makes it illegal for participants in the gasoline production and distribution network to conspire to restrict supply or raise prices after a disaster. The antitrust laws, as enforced by the Department of Justice’s Antitrust Division and the Federal Trade Commission, prohibit actions such as the following.
- Gasoline retailers exploiting the reduced availability of gasoline by explicitly colluding on higher price levels than otherwise would have prevailed.
- Explicit collusion among refineries and wholesalers to designate exclusive territories, allowing them to charge monopolistic prices in those areas.
- Unlawful monopolization or attempts to monopolize by gasoline retailers in a relevant retail geographic market.
- The imposition of some retail price maintenance schemes in which gasoline is made available to retailers only on the condition that the retailer charges a price higher than a pre-set minimum.
You can download a souvenir copy of the paper in cumbersome .pdf format by clicking here.
Bombshell Gallup Poll
Bloomy Goes Indy
The prospective political calculus of a Rudy-Bloomberg-Clinton matchup in November 2008 makes my head hurt...
STATEMENT BY MAYOR BLOOMBERG ON PARTY AFFILIATION
“I have filed papers with the New York City Board of Elections to change my status as a voter and register as unaffiliated with any political party. Although my plans for the future haven’t changed, I believe this brings my affiliation into alignment with how I have led and will continue to lead our City.
“A nonpartisan approach has worked wonders in New York: we’ve balanced budgets, grown our economy, improved public health, reformed the school system and made the nation’s safest city even safer.
“We have achieved real progress by overcoming the partisanship that too often puts narrow interests above the common good. As a political independent, I will continue to work with those in all political parties to find common ground, to put partisanship aside and to achieve real solutions to the challenges we face.
“Any successful elected executive knows that real results are more important than partisan battles and that good ideas should take precedence over rigid adherence to any particular political ideology. Working together, there’s no limit to what we can do.”
Allah predicts Bloomberg pulls 10% of the popular vote. Given that Ross Perot managed 19% in 1992, I suspect Hizzoner's billion dollar purse buys him at least into the 20s.
Hugh Hewitt thinks Bloomberg's Presidential candidacy (whenever Mr. Mayor decides to officially drop that shoe) tends to help Mitt, at least in the GOP primary. (I like that.)
Captain Ed judges him Hillary poison. (I like that even more.)
Previously: Bloomberg Stakes a Billion
Important: Read Before Watching SiCKO
Or, for best results, read it and then don't see SiCKO at all.
I'm delighted such a thorough and facile rebuttal has emerged even before the documentary (crockumentary? Schlockumentary? Have we settled on a word yet for a mockumentary that thinks it's a documentary?) is officially released (not counting the widespread internet distribution of pirated copies). In fact, I had asked for a collective rebuttal once those of hardy constitutions had a chance to see the film, in hopes for some measure of remedy to what I brashly assumed would be another dose of Moore's distinctly and snivelingly misleading socialist propaganda.
Seems that, yes, that indeed is the increasingly familiar poison that Moore's peddling here. Thankfully, the Post's Kyle Smith has penned a serviceable and amusing antidote.
[Note to self: insert additional health care puns here before posting...]
Some highlights from Smith's piece, which get to the heart of Moore's slithery style of logical meandering, data cherry picking, and, well, outright falsification (my emphasis, throughout):
The silliness of Moore’s oeuvre is so self-evident that being able to spot it is not liberal or conservative either; it’s a basic intelligence test, like the ability to match square peg with square hole.
The bulk of "Sicko" is given over to the stories of Americans who got the run-around from health insurers. ... Moore’s style is to present whatever information he likes without checking it. He told "Entertainment Weekly" "absolutely not," when asked whether he felt any need to get the other side of the story. So, over time, his work rusts out from within as the facts eat away at it.
Here’s how easy it is to lie by anecdote: Say I wanted to make a film about gay black Republicans who live in Chelsea. I find ten of them, make a film about them, and you walk out of the theater thinking: Wow, so many gay black Republicans in Chelsea! The six years it took me to find these ten guys will go unnoted.
In his EW interview, Moore tacitly admitted that "Sicko" lies about [typical Canadian health care] wait times, saying, "Well, okay, let’s set up a system where we don’t have the Canadian wait. Let’s set up a system where we take what they do right and don't do the things that we do wrong." Yes, and let's also make sure that every girl gets to be the prettiest girl in town.
Moore, at a Havana hospital, says he requested that his group receive exactly the same care as any Cuban who walked in—"and that’s exactly what they got." As comedy, this statement is on a par with the sex scene in "Knocked Up," the chest waxing in "The 40-Year-Old Virgin" and the moment in "An Inconvenient Truth" when Al Gore tells us that the ecology’s no. 1 enemy, China, is in fact "on the cutting edge" of environmentalism.
But Moore solemnly reports Cuba’s official health statistics, which are of course a fiction dreamed up by El Presidente, because Moore's motto is to trust no authority figure from cringing corporate spokesman on up to Washington windbags. Except dictators. Dictators, he’ll take your word for it.
Despite his apparent belief that he can seem moderate by narrating the film in a sing-song, I’m-talking-to-a-child-or-moron tone, the man can no more hide his Marxism than his belly. He presents not only [radical British leftist] Tony Benn but Che Guevera’s daughter as voices of sanity and, through a French doctor, Moore sneaks in the Marxist slogan "from each according to his ability, to each according to his needs." Everyone who has ever lived in a country that put this idea into practice has found that it actually means this: Give the country whatever it asks for and take back whatever it gives you, and do so without complaint or go to prison.
(HT: The Corner)
Rudy's Brain Trust
Just minutes after the release of Hillary's meticulously engineered selection of the optimal dulcet tones and warbly sentimentality with which to turn on our heartlights, Team Rudy has unveiled his Economic Policy Board. I was a little bummed not to make the cut, but he's made some fine choices nonetheless.
The inclusion of a few bona fide voodoo economists and flat-taxers tends to flesh out the avowedly pro-growth fiscal framework Rudy has appeared to lay out thus far. The inclusion of Glenn Hubbard and/or Art Laffer would've really sealed the deal, but this is a fine list and it speaks volumes about Rudy's seriousness and indeed of his increasingly clear-cut economic conservatism.
Not only does the timing of this press release offer a nice bit contrast with the juke box heroine, but it also tends to put a little economic daylight between Rudy and those of his Republican opponents who haven't as yet made their economic temperaments as clear.
Forbes is a distinguished leader in the business community. He is President and Chief Executive Officer of Forbes and Editor-in-Chief of Forbes magazine, and is also a frequent business commentator for Fox News Channel's "Forbes on Fox." In 1985, President Reagan appointed Mr. Forbes as Chairman of the bi-partisan Board for International Broadcasting (BIB), where he directed the programming for Radio Free Europe and Radio Liberty. He was reappointed by President George H.W. Bush and served until 1993. In 1996 and 2000, Mr. Forbes ran as a Republican candidate for president on a platform that advocated a flat income tax. He is currently on the boards of The Ronald Reagan Presidential Foundation, the Heritage Foundation and The Foundation for the Defense of Democracies, and is the author of two books on political and economic policy issues.
Simon is co-chairman of William E. Simon and Sons, LLC, an investment firm, which he co-founded in 1988 with his father, William E. Simon, Sr., a former United States Treasury Secretary, and his brother J. Peter Simon. He has given speeches to numerous conservative organizations including the Heritage Foundation, Manhattan Institute, Conservative Political Action Conference and the Pacific Research Institute. In addition, he has appeared regularly on FOX News and written articles for the American Spectator and NewsMax.com. He also currently serves as co- chairman of the Cynthia L. and William E. Simon, Jr. Foundation, which helps needy children in urban areas through faith-based efforts. Simon entered the political arena in 2001 as a Republican gubernatorial nominee in California. Early in his career, Simon worked as an Assistant United States Attorney for the Southern District of New York with Mayor Giuliani, who was then the United States Attorney for the Southern District.
Dr. Michael Boskin
Dr. Boskin is T. M. Friedman Professor of Economics and Senior Fellow, Hoover Institution, Stanford University. He is also Research Associate at the National Bureau of Economic Research. He served as Chairman of the President’s Council of Economic Advisers (CEA) from 1989 to 1993 and chaired the Commission on the Consumer Price Index.
Dr. Boskin has received numerous professional awards and citations. In addition to Stanford and the University of California, he has taught at Harvard and Yale. He is the author of more than one hundred books and articles. He is internationally recognized for his research on world economic growth, tax and budget theory and policy, Social Security, U.S. saving and consumption patterns, and the implications of changing technology and demography on capital, labor, and product markets.
Malpass is the Chief Global Economist of Bear Stearns. He joined the firm in February 1993 and is a Senior Managing Director. His duties include economic forecasts for the U.S. and major foreign economies, Washington analysis, and global investment themes.
Malpass has held a series of economic appointments during the Reagan and Bush administrations, including six years with Secretary James Baker at the State and Treasury Departments. He was also Republican Staff Director of Congress’s Joint Economic Committee and Senior Analyst for Taxes and Trade at the Senate Budget Committee. He has experience with an variety of economic, budget, and international issues, including the 1986 tax cut, the Gramm-Rudman budget law, the savings-and-loan bailout, NAFTA, the Brady plan for developing country debt, and the fast-track trade authority.
Malpass, a graduate of Colorado College, holds a master's degree in business administration from the University of Denver.
Dr. Martin Anderson
Anderson is the Keith and Jan Hurlbut Fellow at the Hoover Institution at Stanford University. He was Assistant to the President for Policy Development under President Ronald Reagan and served as a member of the President's Economic Policy Advisory Board. He is credited with helping to develop “Reaganomics.”
Anderson has advised five presidential campaigns on economic policy, including Presidents Richard Nixon, Ronald Reagan, and George W. Bush. He also served in Nixon’s administration.
Dr. Anderson holds a Ph.D. in industrial management from the Massachusetts Institute of Technology.
Anderson is a research fellow at the Hoover Institution. From 1981 to 1983, Anderson served as the associate director for economics and government with the U.S. Office of Management and Budget, where she was responsible for the budgets of five cabinet departments (Treasury, Justice, Commerce, Transportation, and HUD) and over 40 other agencies. She has also advised the governments of Russia, Romania, and the Republic of Georgia on economic reform.
She was also a senior policy adviser to the Ronald Reagan’s 1980 presidential campaign. Anderson holds a Ph.D. from Columbia University.
Hillary Burns, Yearns, Gently Turns
It's official. Our long national fever of anticipation for Hillary Clinton's campaign theme song has broken. And the winner is...
"You and I"
By Celine Dion
High above the mountains, far across the sea
I can hear your voice calling out to me
Brighter than the sun and darker than the night
I can see your love shining like a light
And on and on this earth spins like a carousel
If I could travel across the world
The secrets I would tell
You and I
Were meant to fly
Higher than the clouds
We'll sail across the sky
So come with me
And you will feel
That we're soaring
That we're floating up so high
Cause you and I were meant to fly
Sailing like a bird high on the wings of love
Take me higher than all the stars above
I'm burning, yearning
Gently turning round and round
I'm always rising up I never
Want to come back down
I, um... don't get it.
Update: Okay, I still don't get the song selection (seriously, it oozes Canadianism from every musical pore), but there's more to this press release than I realized.
The e-mail sent out by the Clinton campaign gave two links, one as noted up top, and this other one, which takes you to the video announcing the selection. The video (a parody of the Sopranos finale) is far superior to the song choice. Genuinely amusing, clever, and as close to folksy as she's ever going to muster. They even got Johhny Sack to play the role of Members Only Jacket.
I'm not sure why this wasn't the only link sent out. It wasn't even given top billing. Maybe it's just me, but I'd completely missed it until I saw it mentioned elsewhere.
Yon's Thoughts "On the Eve Of a Great Battle"
Michael Yon's latest post from the front lines suggests a palpable Petraeus-induced inflection point in his perception of the war. He details a "remarkable turnaround" in some of the most troubled areas since Petraeus took over.
Yon also discusses the unfolding of a major new initiative.
By the time these words are released, we will be in combat. Few ears have heard even rumors of this battle, and fewer still are the eyes that will see its full scope. Even now—the battle has already begun for some—practically no news about it is flowing home. I’ve known of the secret plans for about a month, but have remained silent.
This campaign is actually a series of carefully orchestrated battalion and brigade sized battles. Collectively, it is probably the largest battle since “major hostilities” ended more than four years ago. Even the media here on the ground do not seem to have sensed its scale.
A natural complement to ambulance chasing though, I suppose.
(HT: Hot Air)
NY Fed Doing Kim Jong Il's Laundry
Last week the New York Federal Reserve made what may go down as the most misguided move in the history of the Federal Reserve system. They laundered money for North Korea.
A painful flurry of hearings may soon be on the horizon. Last week a group of influential Republicans, including the ranking member of the House Committee on Foreign Affairs, Ileana Ros-Lehtinen, asked the Government Accountability Office to investigate whether anti-laundering and counterfeit laws were broken. They may well have been.
The trouble started when the U.S. agreed to unfreeze $25 million of North Korean funds on deposit in Macau at Banco Delta Asia (a little reward for North Korea's compliance with a Clinton era nuclear shutdown framework). Since the U.S. Treasury has identified Banco Delta Asia as a money-laundering institution, no American commercial entities may transact with it (and reputable overseas banks won't either). Because of the Treasury designation, North Korea would literally need to pick up their cash in person at Banco Delta Asia, then tote it home from Macau.
Such a schlep was apparently too bothersome, however, and North Korea correctly saw great opportunity in securing an electronic solution.
The country then reneged (as it always seems to), and said that it needed the money to be wired home, something the U.S. never agreed to.
North Korea clearly added this new condition because it hoped to reenter the world financial system. No bank would transfer money from Banco Delta Asia without express approval from the U.S. Treasury. If that permission was given, the prohibition was broken, signaling to other banks around the world that they could resume business with the rogue state.
So the U.S. State Department, ever the naive optimist with regard to North Korea, got the clever idea that it could ask the New York Fed Bank to be the conduit for the North Korean funds, since it might not be covered by the U.S. law prohibiting commercial entities from doing business with money launderers.
This solution (to use the term liberally) is regrettable on many levels. Not only does it represent a significant acquiescence to North Korea and a willingness to turn a blind eye to criminal activity among financial institutions elsewhere in the world, but the signaling Hassett refers to is particularly troubling. Kim Jong Il's prospective sales (and/or purchases) of weapons, nuclear secrets, military intelligence, and terrorist support become far easier if he is able to rejoin the global financial community under the veil of fraudulent concealment offered by complicit overseas banks (and perhaps newly legitimized by the U.S. State Department and the Federal Reserve Bank of New York).
Another unintended and unwelcome (and not unforeseeable) consequence of this odd capitulation is the presumptive compromise of the political independence of Fed policymakers.
It may or may not have been sound foreign policy to make this concession to the North Koreans. The problem for the Fed is that there are enough people in Washington who think it was a catastrophic error. There will almost certainly be a lengthy investigation into the matter. If that investigation turns up legal technicalities that go against the Fed, then hearings will happen, and heads may roll.
The worst outcome is this: If somebody in Congress disagrees with the Fed's monetary policy, they now have a weapon they can use against the central bank. That can't be good for monetary policy.
No, it can't. Whether or not there are ever such investigations and head rolling and whether or not any member of Congress ever implicitly wields threats thereof to lord power over the Fed, the presumption of that opportunity has the potential to be materially damaging, in and of itself, not just to the integrity of the central bank, but to the efficient functioning and stability of our financial markets. The Fed's most important stock in trade, by far, is its credibility. For the Fed, credibility is a measurement of the public markets' faith in that body's analysis, judgment, and independence.
If that looming political leverage is enough to shake the public's perception of Fed independence, then the Temple begins to wobble.
For that reason, we'd all be well served by a swift and thorough investigation and as much prompt head rolling as is warranted. (As Jack Traven would put it, "Shoot the hostage ... take her out of the equation.") If you take away the political leverage, there's no perceived threat and no crisis of credibility.
Even if this affair includes no "wrongdoing" per se (something of which Republican lawmakers are not yet convinced), in terms of ethical and/or legal breaches, this appears to have been a bad enough idea, with sufficiently and predictably damaging consequences to Fed credibility (not to mention possibly serious international implications), that none of the NY Fed higher-ups should be beyond potential reproach or replacement, including Chairman Bernanke, New York Fed President Timothy Geithner, and those board members elected and appointed to represent the public, including Columbia University president Lee Bollinger, Lehman Brothers chairman Richard Fuld, New York AFL-CIO president Denis Hughes, General Electric chairman Jeff Immelt, PepsiCo president Indra Nooyi, and Tishman Speyer president Jerry Speyer.
Global Warming, Al Gore Not Getting Enough Attention
[G]ore struggles to get his message across when TV networks are donating the majority of their airtime to American socialite Paris Hilton’s stint behind bars.
In an exclusive Sun interview, Mr Gore said: “The G8 have been meeting in Germany and the United States is throwing a monkey wrench in the efforts to get a consensus.
The planet is in distress and all of the attention is on Paris Hilton. We have to ask ourselves what is going on here?”
Indeed, if Technorati is any indication, global warming is only the 6th hottest topic these days (four spots behind Paris). Thank God for that awareness-raising concert series this summer, during which a third of humanity will focus their gaze on their jet-setting, carbon-spewing, pop iconic betters. With an audience of 2 billion, the overdue focus that the intercontinental spectacle will lend to Earth's pending doom should more than make up for the intercontinental piles of trash that will comprise the wake of this self-indulgent, self-congratulatory global movement.
By the time the garbage is hauled away, the grass resodded and the private jets hangared, maybe - just maybe - people will finally notice Al Gore and the fact that he cares about the environment.
Watch Michael Moore's Latest Socialist Film the Way Socialism Intended
Sicko, Michael Moore’s new movie about America’s health care system (the one that glorifies the socialized medicine of Cuba) hasn’t even hit theaters yet, but already it’s been leaked to the internet.
Asked what he thought of that, Moore (ever one to play the part of the good socialist) says he doesn’t really mind. He’s fine with his movie being downloaded and shared all over the internet.
“I don’t agree with the copyright laws and I don’t have a problem with people downloading the movie and sharing it with people,” said Moore when asked about pirating. “I make these books and movies and TV shows because I want things to change, so the more people that get to see them the better, so I’m happy when that happens. I think information and art, ideas should be shared.”
In the mean time, if you actually have the stomach for it, go ahead and subject yourself to it. The only way I was able to get through Fahrenheit 9/11 was to bring a notebook and document as much of the fact-twisting and logic-torturing I could keep up with. If that therapeutic exercise makes Sicko a little more palatable, give it a shot and send along your fact-checks and fallacies. With a few sharp-eyed, strong-stomached viewers, we should be able to put together a catalog of debunking - a Sicko companion reader of sorts - that calls out and lays bare each stretched truth and sleight of logic.
(Maybe that's premature - not having seen it, I have to concede that Sicko may be a completely responsible, fair, and accurate "documentary". I'm jumping to the conclusion that it's approximately the opposite, based solely on the entirety of Moore's existing body of work.)
U.S. Senate Overrun By Turds
Just as carriages turn back into pumpkins, this is what happens when Senators stay in the Capitol past midnight.
"Usually, if a turd gets into the Senate, it’s because he or she was elected," Emily Heil reports for Roll Call. "But on Wednesday, several large piles of actual, nonmetaphorical 'No. 2' found their way into the Capitol, and the source isn’t yet clear."
Heil continues, "On Wednesday afternoon, Capitol Police cordoned off a section of the hallway on the third floor of the Senate side of the Capitol, where at least three piles of the stuff were causing a stench — and a stir. At first, the word circulating among the staff was that a visiting child had fallen ill while in the gallery. But then the prevailing theory was that the foul stuff had come from an adult or group of adults making a yet-to-be-determined political statement."
Witnesses said they couldn’t believe that a single culprit could have produced the volume of poo present or that a person could have, well, deposited it the normal way without attracting attention. Several witnesses speculated it had been brought in from elsewhere.
“There was so much of it, there was just no way it came from a little kid or even that one person had done it,” said one staffer who witnessed the stinky scene.
Strong Like Bull
If the stock market were to finish today's session at its current level, it'll mark the largest 3-day gain in the Dow (nearly 400 points) in more than four years.
Draw your own conclusions from this fun fact: The last time the blue chips notched up such a strong triple session gain was March 17-19th, 2003 (405 points), which paralleled Saddam's unmet 48-hour exit deadline and the launch of Operation Iraqi Freedom.
Retail Inflation: Headline Hot, Core Cool, Stocks Soar
In similar fashion to yesterday's wholesale inflation reading, today's CPI report from the Labor Department showed overall inflation in May outpacing expectations (0.7% actual vs. 0.6% forecast), but core inflation cooling off unexpectedly (0.1% actual vs. 0.2% forecast). The tame inflation reports have served to unwind much of the recent spike in bond yields, which has in turn encouraged the equity markets to reclaim the ground they'd lost in recent days.
Stocks leapt out of the gate this morning, with the Dow jumping more than 100 points in the first few minutes of trading. On the heels of strong gains Wednesday and Thursday, that puts the average back within 100 points of its all-time high.
In their ebullience, traders seem to be dismissing any gloom inferable from Fed Chairman Ben Bernanke's comments to an Atlanta Fed conference this morning, which seemed to suggest an underestimated possibility of the housing downturn spilling over into the broader economy.
[C]hanges in home values may affect household borrowing and spending by somewhat more than suggested by the conventional wealth effect because changes in homeowners' net worth also affect their external finance premiums and thus their costs of credit...
The Taxman Charmeth
This just in: you like to pay taxes. You just don't like to admit it.
It seems 19 Oregonian co-eds got excited about giving up some of their research fees in the name of taxation. And why is that scientifically interesting? Because their excitement was measured in a super-sciency way.
Bill Harbaugh at the University of Oregon in Eugene, US, and colleagues gave 19 female university students $100, and told them some of this money would have to go towards taxes.
As the participants viewed the tax scenarios, their brains were scanned using functional magnetic resonance imaging (fMRI). Surprisingly, whenever the students read the taxation scenarios, scientists saw a spike in activity within two of the brain's reward centres – the nucleus accumbens and caudate nucleus.
Yes, well, to borrow from another Professor, something involving that many big words could easily destabilize fiscal policy as we know it.
Oregon's taxpayers must be doubly enraptured that they got to pay for that study.
(HT: Hot Air)
E'wardsonomics: The Journey To Affordability Begins With Trampling the Free Market
It must be exhausting spending your days trying to cram such naked illogic into voters' heads.
Democratic presidential candidate John Edwards wants to reduce the cost of U.S. health care by removing patents for breakthrough drugs and requiring health insurance companies to spend at least 85 percent of their premiums on patient care.
A trial lawyer likely has a somewhat easier time suspending reason in support of a policy that seeks to drub the pioneering healthcare researchers and drug developers he's spent his career fleecing, but the thunderous fatuity of this idea would seem to needle the common sense of even the most mildly sentient creature.
It's a classic example of the 2nd most common left wing economic fallacy - failing to consider any but the most immediate consequences (the most common of course being the failure to recognize that changes in tax policy yield changes in economic behavior).
Eliminate patents on blockbuster drugs and, yes indeed, drug prices will quickly plummet as every pricey pharmaceutical on the market will be open to generic competition. Citizens, rejoice - the era of cheap healthcare has arrived. And Mr. E'wards dearly hopes we adopt his short-sightedness and accept that the chain of causality ends there.
The impudently rational, however, will quickly realize that the next thing to plummet is the share price of Pfizer, Merck, Johnson and Johnson, Eli Lilly, Wyeth, and every other innovator of life-saving medical breakthroughs (not to mention the value of the millions of pension funds and 401k's invested in them). By drastically diminishing the profitability of any future blockbuster drugs, Mr. E'wards' plan deftly prevents an untold number of future pharmaceutical breakthroughs, thus saving our children from the headache of grappling with how to pay for them.
His second tenet - empowering government to decide how insurance companies spend their money - is no better. It's symptomatic of a knee-jerk presumption of the unflinching evilness of private enterprise that is so hard-wired, it engenders the kind of inherently flawed logic that government is better at making economic decisions than the free market.
I have no doubt that the folly of this plan will pale in comparison once we get a complete look at Hillarycare Redux, but for now, Johnny Coiffeur seems to have won the booby prize.
The Taxonomy of Harry Reid
It may come as little shock that the most unwaveringly fatalistic naysayer in the U.S. Senate is finding fault among our military leaders, but you have to credit Reid for really committing to his ever-darkening despondency by labeling both Generals Pace and Petraeus "incompetent". (The same General Petraeus Reid voted to confirm a few months ago.)
With this news coming just a day after the Senate Majority Leader's most recent insistence on American military failure, it begs the question: Exactly what breed of pathological pessimist is Harry Reid?
Put otherwise, which of pop culture's wettest blankets does Harry take after?
A) Oscar the Grouch
C) Marvin the Depressed Robot
D) Debbie Downer
E) Davey's mopey dog Goliath
Update: Yipes, the poll widget was wreaking all kinds of havoc with the page formatting, so I've scrapped it. Cast your vote in the comments instead.
May Inflation Half-Time Report
No huge surprises in this morning's wholesale inflation report. The headline PPI rose 0.9% (versus expectations of 0.6%), while core (excluding food and energy) rose 0.2% (versus expectations of 0.2-0.3%). As the core rate tends to be the more closely watched figure at the Fed, and as concerns about near-term Fed policy seemed to be driving some of the recent volatility in both stocks and bonds, this seems to carry at least a slightly calming impact. Heading into the opening bell, stock futures were mostly flat on the news. As I noted yesterday, that was probably about the best we could hope for today, given yesterday's huge upside move and all the recent (mysterious) hand-wringing over inflation and the Fed's response.
While today's report is probably enough of a mixed bag to allow traders to read whatever they like into it, it sets the stage even more dramatically for tomorrow's retail inflation reading, which is considered the more relevant policy-driving number. Expectations for May's CPI looks exactly like expectations ahead of today's PPI - headline at 0.6% and core at 0.2% (which would be unchanged from April). Given prevailing sentiment and today's wholesale reading, these estimates seem to leave more room for a hot-side surprise (at least in the headline number), which could extend the overblown hand-wringing through the final session of the week.
In other objectively positive, but likely uninspiring economic news, jobless claims remained unchanged at 311,000 and the country's largest investment bank's quarterly performance failed to surpass expectations by as wide a margin as some had hoped.
Reid's Courtship of Failure Bordering On Lurid, Tawdry
Do you ever get the feeling that if Harry Reid were to coach a youth soccer league, not only would he forfeit most of the games, but he would typically do so even before all of his kids were assembled on the field?
Top US congressional Democrats bluntly told President George W. Bush Wednesday that his Iraq troop "surge" policy was a failure.
Senate Majority leader Harry Reid and House of Representatives Speaker Nancy Pelosi challenged the president over Iraq by sending him a letter, ahead of a White House meeting later on Wednesday.
"As many had forseen, the escalation has failed to produce the intended results," the two leaders wrote.
I will say this for Reid and Pelosi. Their precognitive abilities are extraordinary, seeing as General Petreaus won't even have an assessment of the surge's efficacy for another three months.
Market Takes Wing On Data, Awaits More
Lurching out of a six-session funk that dragged the Dow Jones Industrial Average nearly 400 points lower, the market surged today on rosy retail sales numbers and some recovery in Treasuries, which had been beat up lately as investors became increasingly skeptical of a Fed rate cut on the horizon.
By the closing bell, the major averages were all higher by well over 1%, with the Dow adding a mighty 187 points (its best single session in nearly 11 months).
Tomorrow morning, we'll get a fresh look at wholesale inflation and jobless claims, both of which ought to shed a little more light on the Fed policy outlook. The market's expecting a headline inflation reading of 0.6% (0.2% core). With all the volatility over the last several sessions, I'd watch for a high-side deviation to spook the Dow back toward yesterday's territory, while a slightly cooler-than-expected number might only be calming enough to convince the market to digest and reaffirm today's closing levels.
If the report comes in on the nose, after all, it'll still represent a month-over-month increase in the core wholesale inflation rate (from 0.0% to 0.2%). The market is already aware of that, of course, but even so, if the actual number matches expectations perfectly and the typical headline is still "Inflation Increasing!", it might just be enough to trigger another triple-digit down day.
By Leaps and Bounds, the Strangest Story You'll Hear Today
This boy is an inspiration to breath-holders, runners-away, and every other child who's thrown out an idle threat in attempt to get his way.
Ten years ago Ben Grocock told his mother that if she made him have an operation to remove his tonsils he would never speak again.
And, after coming round from the anaesthetic following surgery, the boy steadfastly stuck to his word - until now.
Ben Grocock, now aged 13, has barely uttered a word throughout most of his life, following the promise he made when he was just three years old.
He still spoke to his younger brother Sam, now, 12, but always out of earshot from the rest of his family.
[Ben's mother] Linda said: "He first started speaking to me again after he fell off his bike, he said 'ouch, that hurt', in shock.
"Once he had it was like he broke the barrier with me and could carry on talking."
But he still couldn't talk to anyone else including his grandparents, teachers and friends until his school, Liskeard Community College, enrolled him on a confidence-building course with Cornwall Fire Brigade.
After a week with the officers Ben managed to thank the firefighters in front of a crowd.
What Country Does Your State Stack Up To?
Nifty economic map from the Strange Maps blog. It's a map of the U.S., with each state renamed for a country with a roughly equivalent GDP. It's looking at aggregate, not per capita GDP, so it's simply a comparison of each state/country's overall economic output, not a comparison of individual productivity, wealth, or standard of living.
California, the largest state economy, roughly matches the output of France, the 8th largest economy in the world. New York weighs in at a respectable Brazil. Bringing up the rear is Wyoming, on par with wee Uzbekistan.
Click the image for the much larger original.
An interesting extension would be to reassign each state according to its GDP growth rate. And maybe its average effective tax rate...
1 score and 0 years ago...
"Mr. Gorbachev, open this gate. Mr. Gorbachev, tear down this wall."
(HT: Peter Robinson)
Sleeping Too Well Lately?
John Hawkins has the cure for what ails you.
Sopranos Finale Double Take: There ARE [NOT, as it turns out] Two Tonys In the Diner
[Note: The following theory is, upon further study, totally wrong, per the update below.]
I've been reading a lot of different theories about the final scene today - the identity (and intentions) of the menacing fellow at the bar credited as "Member's Only Jacket", whether Meadow's gynecologist appointment (and shotgun wedding) means she's pregnant, the significance of the chosen (and bypassed) songs on the table juke, the Godfather nod when MOJ retires to the men's room, a possible connection between MOJ and the episode entitled "Member's Only" (the first of the early season dream episodes, featuring Kevin Finnerty), whether the sudden blackness and silence (and the unprecedented silence over the ending credits) signify the whacking of Tony, of we gentle viewers, or both, etc. Far too many people offering interesting theories about interesting bits with many with too many permutations to run through with due attention here and now, but one item I hadn't caught the first time through that people were chatting about was that Tony appears to view himself seated at a table in the diner immediately after coming through the door.
When I read that, I assumed it was just an abrupt cut, jumping quickly from a close-up on Tony's face upon entering to Tony seated in the back of the restaurant. I've just caught the end of the episode again and indeed it is an abrupt cut from the close-up at the door to the seated shot, which isn't overly bizarre given the heightened tension of this final scene. What is overly bizarre is the fact that the two Tonys are wearing different clothes.
I'm 98% sure the Tony at the door is wearing a gray crew neck shirt under a leather jacket. The seated tony is wearing a black and white collared bowling shirt. Yes, he presumably removed his jacket in the excised time between the shots, but what's with the change of shirt? Say what you will about David Chase's choice of closure, but the show is far too meticulous to make such a significant continuity flub. Assuming it's intentional, though, it doesn't seem to jive with any of the theories I've come across (other than the one that suggests Tony's been dreaming ever since he curled up with his firearm at the end of last week's episode, which was among the thinner propositions; the tone didn't mesh with any of Tony's earlier dream sequences).
I'd need to see it one more time to pay specific attention to the wardrobe at the crucial cut. Wizbang had posted a link to the final scene, but YouTube seems to have quashed it. As soons as it's VODable, I'll take a look. Anyone else mentally chomping on this bit?
Update: It's now VODable and upon further viewing, it appears the 2% margin of error I left myself prevailed. Tony's black leather jacket conceals the black parts of his bowling shirt (the collar and the side panels), making it appear solid gray. It's nothing more than an awkward cut, continuity intact.
Fall of the Creditworthinessmonger
Well that didn't take long.
A week ago, I noted the budding business of credit piggybacking, wherein an intermediary (like Seasonedtrades.com and Instantcreditbuilders.com) effectively brokers creditworthiness by enabling people with good credit to add people with bad credit as authorized users of their credit cards (all for a tidy sum, the bulk of which is kept by the broker). The credit seller assumes no risk because the credit buyer never actually gets access to the card or card number. So no "credit" is exchanged, per se, just creditworthiness (as low FICO ratings improve as a result of becoming an authorized user on a clean, high-limit card).
Now, Fair Isaac Corp is kiboshing the trick.
Starting in September, consumers who are added as an authorized user on someone else's credit card will no longer be able to benefit from that card's credit history. The change reverses the current practice, known as piggybacking, which treats all authorized users the same as the cardholder.
In an interview last year, a Fair Isaac spokesman said the company allowed the quirk because it didn't have any proof that people were gaming the system to lenders' detriment. But after researching the market and discovering a number of companies that sell the right to become an authorized user on complete strangers' credit accounts, Fair Isaac decided it was time to close the loophole, according to Ron Totaro, vice president of global scoring solutions at the Minneapolis-based company.
Fair Isaac estimates roughly 1% of consumers will be affected by the change. The decision is part of a broader overhaul to the model used to generate FICO scores. The company plans to introduce its new product, FICO 08, to one of the major credit bureaus -- , Experian or TransUnion -- in September and to roll it out at the remaining two early next year.
Previously: Rise of the Creditworthinessmonger
World's Greatest Golfer May Be At Death's Door
Kim Jong Il, North Korea's reclusive leader, has been so unwell that he could not walk more than 30 yards without a rest, western governments have been told.
Diplomats in the North Korean capital, Pyongyang, are increasingly convinced that the 65-year-old dictator needs heart surgery to restore his apparently flagging health. He has had to be accompanied by an assistant carrying a chair so that, wherever he goes, he can sit and catch his breath.
Kim's public appearances have been curtailed this year and he has appeared in public only 23 times, compared with 42 times at the same point last year - an indication, observers say, of his declining health. The suggestion that he underwent an operation offered an apparent explanation for his recent month-long disappearance from public view.
Setting aside the maniacal despotism, it's a grim thought that history's finest linksman might never play another round.
(HT: Captain Ed)
Jesus Collars One For the NYPD
An Arizona man shocked cops in the East Village this week by walking into the local precinct and announcing that he'd strangled a woman on East 13th Street during an argument in 2004 - and that Jesus Christ wanted him to turn himself in.
Authorities said the confession has solved the previously cold-case murder of Myrna Gonzales, a 45-year-old homeless woman whose body was found folded into a large steamer trunk in a vacant lot at East 13th Street and Third Avenue.
"We wish Jesus would solve more of these," one law enforcement source said.
Michael Mohr, 51, might have gotten away with the slaying. But he'd recently had a religious conversion, and realized Jesus wanted him to do the right thing.
Isn't There an Empty Vault That Needs Opening?
You need to wade into this clip nearly 7 minutes before you get to the offending portion, but Geraldo Rivera actually makes the claim that we shouldn't deport illegal immigrants who are duly convicted of crimes on U.S. soil (not immigration crimes mind you, but unrelated crimes once they're here) because - now wait for it, wait for the insanity - that would mean we would've had to deport John Lennon if that policy were retroactively (and, I guess, posthumously) enforced. And we would've lost "those great ten years of John Lennon living in New York," Rivera laments.
QED. Game, set, and match. Well played, Gerald.