links for 2008-07-18

• Dead Left (On Shock Doctrine) - Jon Chait
• Short-run ignorance, long-run prescience: Forecasting exchange rates - Vox EU
• “No Atheists in Foxholes.” — No Libertarians in Financial Crises. - Jeff Frankel
• Sadly, no (on credit market discrimmination) - Kathy G
• China paper - CBO Director’s Blog
• Natural selection may not produce the best organisms - EurekAlert
• No Friend of the Workers - Editorial - NYTimes.com
• People Found Who Don't Use Numbers - Scientific American
• CBO: Refusing to Pay for Tax Cuts Is Fiscally Irresponsible - EconomistMom
• Finance and growth: When does credit really matter? - Vox EU

Comments

[anne]

http://www.nytimes.com/2008/07/18/business/18catfish.html?hp&pagewanted=print

July 18, 2008

As Price of Grain Rises, Catfish Farms Dry Up
By DAVID STREITFELD

LELAND, Miss. — Catfish farmers across the South, unable to cope with the soaring cost of corn and soybean feed, are draining their ponds.

“It’s a dead business,” said John Dillard, who pioneered the commercial farming of catfish in the late 1960s. Last year Dillard & Company raised 11 million fish. Next year it will raise none. People can eat imported fish, Mr. Dillard said, just as they use imported oil.

As for his 55 employees? “Those jobs are gone.”

Corn and soybeans have nearly tripled in price in the last two years, for many reasons: harvest shortfalls, increasing demand by the Asian middle class, government mandates for corn to produce ethanol and, most recently, the flooding in the Midwest.

This is creating a bonanza for corn and soybean farmers but is wreaking havoc on consumers, who are seeing price spikes in the grocery store and in restaurants. Hog and chicken producers as well as cattle ranchers, all of whom depend on grain for feed, are being severely squeezed.

Perhaps nowhere has the rise in crop prices caused more convulsions than in the Mississippi Delta, the hub of the nation’s catfish industry. This is a hard-luck, poverty-plagued region, and raising catfish in artificial ponds was one of the few mainstays.

Then the economics went awry. Feed is now more than half the total cost of raising catfish, compared with a third of the cost of beef and pork production, according to a Mississippi State analysis. That makes catfish more vulnerable. But if the commodities continue to rocket up — and some analysts believe they will — other industries will fall victim as well.

Keith King, the president of Dillard & Company, calculates that for every dollar the company spends raising its fish, it gets back only 75 cents when they go to market.

“What’s happening to this industry is sad, but being sentimental won’t pay the light bill,” Mr. King said.

Dillard and other growers take their fish, still squirming, to Consolidated Catfish Producers in the hamlet of Isola, where workers run the machinery that slices them into filets. With fewer fish coming in, Consolidated Catfish is resorting to layoffs.

One hundred employees were let go in the last month, and an additional 200 will be cut soon. President Dick Stevens predicts that by the end of the year the company will have jobs for only 450, about half the number at its peak. That might not be enough to keep the plant open.

“The industry is going to implode,” Mr. Stevens said. He blamed the government’s ethanol mandates for making fuel compete with food for the harvest of the nation’s farmland. “Politicians were in a rush to do something, and it became a terrible snowball.”

Across the highway, one of the local feed mills, Producers Feed Company, has already shut down. The ripple effects have begun: between the grain mill and the fish plant was Peter Bo’s Restaurant, locally celebrated for, naturally, its catfish. Hanging on the door is a “for rent” sign.

Some catfish producers recently switched to a feed based on gluten, a cheaper derivative of corn, to reduce their costs. But corn gluten transportation and prices were particularly hard hit by the Midwest floods.

“As sick as we were over what happened to the Iowa farmers, we were also sick over what was going to happen to us,” Mr. Stevens said.

It is a feeling echoed by others who depend on corn and soybeans.

In the spring, hog farmers thought they were past the worst. Export sales to China were strong. Corn appeared to level off. Some farmers sought an edge by reformulating pigs’ diets and reducing the weight at which they sent the animals to the packer.

“And then corn goes up another buck, and you’re back where you were,” said Dave Uttecht, a producer in Alpena, S.D., who raises 70,000 pigs a year.

“I’m a farmer. I’m used to peaks and valleys.” Mr. Uttecht said. “But this is like falling into the Grand Canyon.”

Smaller herds will eventually put a floor under hog prices, and there is already some liquidation going on. But in the short term, sending more hogs to market will increase the supply of pork and push prices down further. Every farmer is hoping his colleagues will liquidate first....

[anne]

http://www.nytimes.com/2008/07/18/opinion/18fri2.html?ref=opinion&pagewanted=print

July 18, 2008

No Friend of the Workers

It should surprise no one, at this point, that an arm of the Bush administration charged with protecting Americans' rights or safety is not doing its job. Even so, a government report and a Congressional hearing this week painted a disturbing picture of a Labor Department that simply is not standing up for workers.

President Bush has filled top posts across his administration with people who do not agree with the missions of their organizations. His Environmental Protection Agency has failed to protect the environment; his Justice Department has promoted injustice.

To lead the Department of Labor, Mr. Bush appointed Elaine Chao, who took office in 2001 arguing that states should be able to opt out of the federal minimum wage — a terrible idea that would drive down wages for the lowest-paid employees. For more than seven years, Ms. Chao has run a department that has tilted toward employers and failed to properly enforce labor laws.

In a report released this week, the nonpartisan Government Accountability Office took a close look at a sampling of cases handled — or, rather, mishandled — by the Wage and Hour Division of the Labor Department. It found that the division failed to adequately investigate complaints that workers were not paid the minimum wage, were denied mandatory overtime or were not paid their last paychecks.

In one case, a delivery truck driver complained that he was not being paid for overtime that he had earned. The complaint languished for more than 17 months before an investigator was assigned. Then, the case was soon closed because the statute of limitations was about to run out.

The division dropped another case, in which disabled children were allegedly being paid cash by a trucking company to operate large machinery in violation of child-labor laws, because its investigators could not locate the employer. The G.A.O. had little trouble finding a company that appears to be the one cited in the complaint.

The G.A.O.'s findings suggest that the government is not doing its job of going after employers who "cheat their employees out of their hard-earned wages," said Representative George Miller, the California Democrat who chairs the committee that held this week's hearing.

The Labor Department responded, as The Times's Steven Greenhouse reported, that the "Wage and Hour Division is delivering pay for workers, not a payday for trial lawyers." The department has it exactly backward. By failing to enforce the law, it is creating more work for trial lawyers, who can turn what should be simple administrative procedures into full-blown lawsuits.

Attacking trial lawyers is a classic Republican talking point. Its use in response to complaints from hard-working Americans that they are being cheated is a giveaway that the real problem at the department is not one of competence, but of ideology....

[anne]

http://www.nytimes.com/2008/07/18/world/middleeast/18contractors.html?hp&pagewanted=print

July 18, 2008

Electrical Risks at Bases in Iraq Worse Than Previously Said
By JAMES RISEN

WASHINGTON — Shoddy electrical work by private contractors on United States military bases in Iraq is widespread and dangerous, causing more deaths and injuries from fires and shocks than the Pentagon has acknowledged, according to internal Army documents.

During just one six-month period — August 2006 through January 2007 — at least 283 electrical fires destroyed or damaged American military facilities in Iraq, including the military’s largest dining hall in the country, documents obtained by The New York Times show. Two soldiers died in an electrical fire at their base near Tikrit in 2006, the records note, while another was injured while jumping from a burning guard tower in May 2007.

And while the Pentagon has previously reported that 13 Americans have been electrocuted in Iraq, many more have been injured, some seriously, by shocks, according to the documents. A log compiled earlier this year at one building complex in Baghdad disclosed that soldiers complained of receiving electrical shocks in their living quarters on an almost daily basis.

Electrical problems were the most urgent noncombat safety hazard for soldiers in Iraq, according to an Army survey issued in February 2007. It noted “a safety threat theaterwide created by the poor-quality electrical fixtures procured and installed, sometimes incorrectly, thus resulting in a significant number of fires.”

The Army report said KBR, the Houston-based company that is responsible for providing basic services for American troops in Iraq, including housing, did its own study and found a “systemic problem” with electrical work.

But the Pentagon did little to address the issue until a Green Beret, Staff Sgt. Ryan D. Maseth, was electrocuted in January while showering. His death, caused by poor electrical grounding, drew the attention of lawmakers and Pentagon leaders after his family pushed for answers. Congress and the Pentagon’s inspector general have begun investigations, and this month senior Army officials ordered electrical inspections of all buildings in Iraq maintained by KBR....

[anne]

http://www.nytimes.com/2008/07/19/world/africa/19mandela.html?hp&pagewanted=print

July 19, 2008

Mandela Celebrates His 90th Birthday
By ALAN COWELL

LONDON — There was a time, not all that long ago, when he was the invisible man whose name was a battle cry, his appearance known to most people only from an out-of-date photograph, a hidden hero on a prison island off the coast of Africa.

But as he celebrated his 90th birthday Friday, Nelson Mandela was anything but invisible, a figure of reverence whose nine decades have been marked and observed at a huge rock concert in London’s Hyde Park, a gala dinner for his children’s charity in the august, chandeliered Long Room at Lord’s cricket ground and a host of tributes.

His birthday Friday was supposed to be a quiet affair in his ancestral village of Qunu in the southeast of his country — with a mere 500 of his closest friends in attendance, and a wry self-deprecation.

“We are honored that you wish to celebrate the birthday of a retired old man, who no longer has power or influence,” he said in a public radio message, according to news reports.

Friday was also the 10th anniversary of his marriage to Graca Machel, the widow of Samora Machel, a revolutionary leader and former president of Mozambique. He divorced Winnie Mandela in 1996.

Part of Mr. Mandela has always seemed to be public property, owned initially by foes of apartheid rule in South Africa and now a kind of universal talisman of integrity and dignity — a name to bring a flush of moral ardor to the most jaded celebrity visages.

Where his name once resonated around the segregated black townships of apartheid South Africa, chanted by the rebellious youths who challenged white rule, it now seems to head a list of encounters with notables sought by rock stars and politicians. He has apparently enjoyed a degree of mutual admiration: in 1997, for instance, he referred to the British pop group the Spice Girls as his “heroes” when he met them.

In his presence, even the most battle-scarred and cynical of politicians seem to feel they are wafted to the high ground wrought by Mr. Mandela’s 27 years in prison. His stature and charisma have given him entrée from the White House in Washington to 10 Downing Street in London.

Remarkably, it is now 18 years since Mr. Mandela was released from jail, 14 years since he triumphed in his country’s first democratic elections, eight since he left office and four since he formally withdrew from public life. But, contrary to his disclaimer of power and influence in his birthday message, he is still seen as a guarantor of his country’s remarkable transition from a segregated to a majority-ruled society.

F.W. de Klerk, the last white president of South Africa who negotiated the transition with Mr. Mandela and shared a Nobel Peace Prize with him in 1993, hailed Mr. Mandela’s role in molding “our widely diverse communities into an emerging multi-cultural nation.”

He has lent his name to the struggle against HIV/AIDs. The rock concert in Hyde Park, using Mr. Mandela’s Robben Island prison number of 46664, was devoted to the effort to combat the epidemic that has been the scourge of Africa....

[anne]

http://www.nytimes.com/2008/07/18/us/politics/18advisers.html?hp&pagewanted=print

July 18, 2008

300 Advisers Shape Obama’s Foreign Policy
By ELISABETH BUMILLER

Barack Obama’s huge foreign policy team is on the spot this week as the senator plans his overseas trip.

[Thus we have indefinite war in and occupation of Afghanistan, not to mention the forever soldier renmants in Iraq. Yes, they can.]

[anne]

http://www.democracynow.org/2008/7/18/headlines#6

July 18, 2008

Group: US Aid to Africa Increasingly Militarized
By Amy Goodman

The advocacy group Refugees International is warning US aid to Africa is becoming increasingly militarized at the expense of humanitarian needs. * In a new report, Refugees International says the Pentagon is exerting increasing control over aid traditionally run by the State Department and US aid agencies. The Pentagon now controls 22 percent of US aid money, up from three percent a decade ago.

* http://www.washingtonpost.com/wp-dyn/content/article/2008/07/17/AR2008071702550_pf.html

[anne]

http://www.anc.org.za/ancdocs/history/rivonia.html

April 20, 1964

"I am Prepared to Die"
By Nelson Mandela

Pretoria Supreme Court: Statement from the dock at the opening of the defence case in the Rivonia Trial.

I am the First Accused.

I hold a Bachelor's Degree in Arts and practised as an attorney in Johannesburg for a number of years in partnership with Oliver Tambo. I am a convicted prisoner serving five years for leaving the country without a permit and for inciting people to go on strike at the end of May 1961.

At the outset, I want to say that the suggestion made by the State in its opening that the struggle in South Africa is under the influence of foreigners or communists is wholly incorrect. I have done whatever I did, both as an individual and as a leader of my people, because of my experience in South Africa and my own proudly felt African background, and not because of what any outsider might have said.

In my youth in the Transkei I listened to the elders of my tribe telling stories of the old days. Amongst the tales they related to me were those of wars fought by our ancestors in defence of the fatherland. The names of Dingane and Bambata, Hintsa and Makana, Squngthi and Dalasile, Moshoeshoe and Sekhukhuni, were praised as the glory of the entire African nation. I hoped then that life might offer me the opportunity to serve my people and make my own humble contribution to their freedom struggle. This is what has motivated me in all that I have done in relation to the charges made against me in this case.

Having said this, I must deal immediately and at some length with the question of violence. Some of the things so far told to the Court are true and some are untrue. I do not, however, deny that I planned sabotage. I did not plan it in a spirit of recklessness, nor because I have any love of violence. I planned it as a result of a calm and sober assessment of the political situation that had arisen after many years of tyranny, exploitation, and oppression of my people by the Whites.

I admit immediately that I was one of the persons who helped to form Umkhonto we Sizwe, and that I played a prominent role in its affairs until I was arrested in August 1962.

In the statement which I am about to make I shall correct certain false impressions which have been created by State witnesses. Amongst other things, I will demonstrate that certain of the acts referred to in the evidence were not and could not have been committed by Umkhonto. I will also deal with the relationship between the African National Congress and Umkhonto, and with the part which I personally have played in the affairs of both organizations. I shall deal also with the part played by the Communist Party. In order to explain these matters properly, I will have to explain what Umkhonto set out to achieve; what methods it prescribed for the achievement of these objects, and why these methods were chosen. I will also have to explain how I became involved in the activities of these organizations.

I deny that Umkhonto was responsible for a number of acts which clearly fell outside the policy of the organisation, and which have been charged in the indictment against us. I do not know what justification there was for these acts, but to demonstrate that they could not have been authorized by Umkhonto, I want to refer briefly to the roots and policy of the organization.

I have already mentioned that I was one of the persons who helped to form Umkhonto. I, and the others who started the organization, did so for two reasons. Firstly, we believed that as a result of Government policy, violence by the African people had become inevitable, and that unless responsible leadership was given to canalize and control the feelings of our people, there would be outbreaks of terrorism which would produce an intensity of bitterness and hostility between the various races of this country which is not produced even by war. Secondly, we felt that without violence there would be no way open to the African people to succeed in their struggle against the principle of white supremacy. All lawful modes of expressing opposition to this principle had been closed by legislation, and we were placed in a position in which we had either to accept a permanent state of inferiority, or to defy the Government. We chose to defy the law. We first broke the law in a way which avoided any recourse to violence; when this form was legislated against, and then the Government resorted to a show of force to crush opposition to its policies, only then did we decide to answer violence with violence.

But the violence which we chose to adopt was not terrorism. We who formed Umkhonto were all members of the African National Congress, and had behind us the ANC tradition of non-violence and negotiation as a means of solving political disputes. We believe that South Africa belongs to all the people who live in it, and not to one group, be it black or white. We did not want an interracial war, and tried to avoid it to the last minute. If the Court is in doubt about this, it will be seen that the whole history of our organization bears out what I have said, and what I will subsequently say, when I describe the tactics which Umkhonto decided to adopt. I want, therefore, to say something about the African National Congress.

The African National Congress was formed in 1912 to defend the rights of the African people which had been seriously curtailed by the South Africa Act, and which were then being threatened by the Native Land Act. For thirty-seven years - that is until 1949 - it adhered strictly to a constitutional struggle. It put forward demands and resolutions; it sent delegations to the Government in the belief that African grievances could be settled through peaceful discussion and that Africans could advance gradually to full political rights. But White Governments remained unmoved, and the rights of Africans became less instead of becoming greater. In the words of my leader, Chief Lutuli, who became President of the ANC in 1952, and who was later awarded the Nobel Peace Prize:

"who will deny that thirty years of my life have been spent knocking in vain, patiently, moderately, and modestly at a closed and barred door? What have been the fruits of moderation? The past thirty years have seen the greatest number of laws restricting our rights and progress, until today we have reached a stage where we have almost no rights at all"....

[John V]

Good article by Chait on the Shock Doctrine.

Having read this incredibly dim and infantile book myself, I got a good smile watching Chait step up and slap Klein down for this nonsensical book which Klein wrote with, as Chait says, "the pseudo-clarity of a conspiracy theorist".

Chait on Klein's take of Chile and Pinochet and Friedman:

"Klein depicts Pinochet as a pure puppet of Friedman. "For the first year and a half," she writes, "Pinochet faithfully followed the Chicago rules." But a half-dozen pages later, while explaining away the impressive economic growth that followed under Pinochet, she writes that "it's clear that Chile never was the laboratory of 'pure' free markets that its cheerleaders claimed." More generally, she seems incapable of understanding that authoritarianism of the sort represented by Pinochet may be as moved by a lust for power as by a lust for profits. They are not the same phenomenon.

...

Her interpretive method is an extremely crude sort of Marxist economicism.

...

she does not seem to know what neoconservatism is; and she makes no effort to find out....Klein calls the neocon movement "Friedmanite to the core," and identifies the Iraq war as a "careful and faithful application of unrestrained Chicago School ideology" over which Friedman presided. What she does not mention--not once, not anywhere, in her book--is that Friedman argued against the Iraq war from the beginning, calling it an act of "aggression." It ought to be morbidly embarrassing for a writer to discover that the central character of her narrative turns out to oppose what she identifies as the apotheosis of his own movement.

...Naomi Klein's relentless lumping together of all her ideological adversaries in the service of a monocausal theory of the world ultimately renders her analysis perfect nonsense.

Well done, Chait. You were actually too kind.

[anne]

Please avoid italicized print, which even on an especially high resolution screen, as I am using now, is too tedious to read, though I read this comment.

Naomi Klein is of course a superb thinker, and the book well done, but there is the problem of Klein being a woman and not being wildly conservative and more importantly not being willing to sing love songs to the tombs of the known-un-known Greenspan wherever they may be.

Imagine the never of a woman thinking along with Nelson Mandela that land reform in South Africa was an essentially missing aspect of forming a viably developing democracy. Imagine the nerve of a woman who thinks Haiti might be better off were the country still agriculturally self-sufficient.

So Klein is savaged by another wild conservative, teaching women what it takes to be a real thinker.

[anne]

Remind me, because I am ever so forgetful, but is that the Jon Chait who worked so hard to get us to invade and occupy Iraq? Is that the Chait, because I forget so easily? Is that the shock and awe Chait, who gloried in smashing Iraq, what for the sake of trebuilding and the like? I forget.

Which Chait was that?

[John V]

Anne,

Neither of your comments address the issue raised. They, instead, attempt to discredit the argument by changing.

You throw out charges of sexism at Chait even though his critique is based totally on her use of facts (or lack thereof) and methodology.

The second comments goes after Chait and what he may have said in the past...again...this says nothing to discredit what Chait actually said in his critique of Klein.

Klein is "OF COURSE" a superb thinker? Perhaps not. At least not on this subject matter and her incredibly and inexcusably flawed thesis.

You counter substance with baseless and/or irrelevant criticisms. Why?

Why not instead say why you think Chait is wrong in this instance on what he actually said?