Month: September 2004
Secrets and Lies
I argued earlier that good intelligence requires more dissemination of information. But the CIA and other agencies are classifying more documents than in the past. The purpose it seems is often to cover up for mistakes or even to censor things that the authorites simply don’t like rather than to hinder terrorists.
Remember those aluminium tubes supposedly intended for use in Iraq’s secret weapons program? A Senate report on prewar intelligence quoted the CIA as saying “their willingness to pay such costs suggests the tubes are intended for a special project of national interest.” The CIA, however, classified how much the Iraqi’s paid as secret, deleting the number. How much did the Iraqi’s actually pay? About $17.50 a piece.
A possible solution to this problem is to create an independent board. Surprise, we have one already! According to J. William Leonard, director of the National Archives’ Information Security Oversight Office, “a 2000 law created a public interest declassification board to recommend release of secrets in important cases, but the president and Congress never appointed members.”
The Crying Bar
One of the hottest bars in the Chinese city of Nanjing sports only a sofa, a few tables, and tissue paper – a lot of tissue paper. The AFP news service reports that the city’s first “cry bar,” where customers can sit and cry for $6 per hour, is growing in popularity. Owner Luo Jun says he opened the bar when clients of his last business said they often wanted to cry but didn’t know when or where it would be appropriate to do so.
My source is Eric Rasmusen, the well-known economist and also conservative Christian. Note that Eric has split his previous blog into two parts, Current Affairs and Everything Else, much of which is microeconomic in nature.
Our Presidential candidates
…conservatism as we have known it is now over. People like me who became conservatives because of the appeal of smaller government and more domestic freedom are now marginalized in a big-government party, bent on using the power of the state to direct people’s lives, give them meaning and protect them from all dangers. Just remember all that Bush promised last night: an astonishingly expensive bid to spend much more money to help people in ways that conservatives once abjured. He pledged to provide record levels of education funding, colleges and healthcare centers in poor towns, more Pell grants, seven million more affordable homes, expensive new HSAs, and a phenomenally expensive bid to reform the social security system. I look forward to someone adding it all up, but it’s easily in the trillions. And Bush’s astonishing achievement is to make the case for all this new spending, at a time of chronic debt (created in large part by his profligate party), while pegging his opponent as the “tax-and-spend” candidate. The chutzpah is amazing. At this point, however, it isn’t just chutzpah. It’s deception. To propose all this knowing full well that we cannot even begin to afford it is irresponsible in the deepest degree. I’ve said it before and I’ll say it again: the only difference between Republicans and Democrats now is that the Bush Republicans believe in Big Insolvent Government and the Kerry Democrats believe in Big Solvent Government. By any measure, that makes Kerry – especially as he has endorsed the critical pay-as-you-go rule on domestic spending – easily the choice for fiscal conservatives. It was also jaw-dropping to hear this president speak about tax reform. Bush? He has done more to lard up the tax code with special breaks and new loopholes than any recent president. On this issue – on which I couldn’t agree more – I have to say I don’t believe him. Tax reform goes against the grain of everything this president has done so far. Why would he change now?
That’s Andrew Sullivan, and I think I am headed out to The Crying Bar.
Courses (markets) in everything
How about a $10,000 class for teaching top executives how to cope with prison? Students are taught the following:
1. Learn meditation and physical exercise routines.
2. Get used to the fact that nothing changes and everything is outside your control.
3. Discard your addictions and vices.
4. Bring a cheap watch.
5. Never make eye contact with anyone; no one is your friend.
6. “If you are going to hurt somebody, drag them into your cell, because then you have an excuse that they invaded your privacy.”
Here is the full story. The entrepreneurs claim they have had twelve clients a year for the last two years.
Redact this
The danger to political dissent is acute where the Government attempts to act under so vague a concept as the power to protect ‘domestic security.’ Given the difficulty of defining the domestic security interest, the danger of abuse in acting to protect that interest becomes apparent.
Story here.
Please make markets efficient
Shares in a Bush win are trading around 58-59 at Tradesports but only 53-54 at the Iowa markets. Could some of you please arbitrage this to prevent the gang at Crooked Timber from crowing about inefficient markets? Thanks.
Addendum: Many thanks to all the sharp MR readers who remind me that the Iowa market is for the popular vote share while the Tradesports markets is for the actual winner. I’m still a little surprised that the spread has widened recently but it is true that the price difference does not necessarily represent an arbitrage opportunity. Long Term Capital Management anyone?
Where are they?
The odds are small, but the expected value of this development is high.
Here is more detailed information. And here is a related piece on why aliens might instead prefer to throw rocks at us.
Seeking safety in Latin America
In Mexico City I am relieved to step out of the taxicab and into the street. Cabs are a major venue for robbery and kidnapping. In Rio de Janeiro I am relieved to step out of the street and into the taxicab. Cabs are relatively safe, but a twelve-year old street urchin might knife you in the gut for a dollar.
I’ve yet to find a good explanation for this difference in criminal method. Could it be that Mexican crime is more closely linked to the drug trade and especially the export of drugs to the U.S.? This increases the optimal size for a criminal gang and might cause robbery and mayhem to be better organized and more capital-intensive. Brazil also appears to have an especially bad educational system, which lowers the average criminal age but also diminishes the relevance of taxis.
Monetary economics on Gilligan’s Island
Did the Castaways use paper money? Yes.
In early episodes, we see Mr. Howell hiring various services from other castaways. We eventually learn he’s been writing checks on a mainland (and therefore inaccessible) bank. This works while the group consider their condition temporary, but the checks are quickly devalued and eliminated when the castaways begin to prepare for the possibility of an indefinite stay on the island.
In Episode 9, “The Big Gold Strike,” Gilligan and Mr. Howell find a gold mine on the island, which Howell convinces Gilligan to keep secret from the others. By the time everyone learns about the mine, Howell has already taken the lion’s share of the most easily accessible gold. He’d like to hoard it for himself, but the other castaways begin charging him for their goods and services. Soon everyone has a small fortune in gold, which they all try to smuggle aboard a tiny escape raft. Their collected wealth, of course, ends up at the bottom of the lagoon.
In later episodes, monetary exchange takes place in US paper currency.
Might such fiat dollar exchange occur in the real world?
The market can reclaim money from government…This is why the castaways value Thurston Howell’s paper dollars: because whatever absurd amount he may have brought with him for “a three-hour tour,” that amount is now fixed. Dollars are the most stable currency available on Gilligan’s Island, and the government has nothing to do with it. Or rather: the absence of government has everything to do with it. If people are allowed to pick their own preferred money, they will pick whatever holds its value most reliably.
Here is the full analysis, courtesy of the Mises Institute.
My take: Fiat money would not survive on Gilligan’s Island, at least assuming that no rescue is expected. Skipper and Gilligan will return to barter, based on some useful island commodity, probably a storable foodstuff. Perhaps they will continue to use dollars as a medium of reckoning, for mutual convenience. But why accept dollars as a medium of payment? Given that only seven people live on the island, there is market power and room for dollar prices to slide over time. (To see one potential problem, imagine the polar case of only two traders — would you mind losing all your dollars? — surely prices would then fall in response.) Dollars would offer little stability of real value, if only because you might start to doubt whether other people would continue to accept them.
Don’t take your salad bag for granted
Today’s [salad] bags are a triumph of practical ingenuity. Their plastic is made of up to five to ten layers, each with a different function. Some are designed to make the package shiny or crinkly, others to carry print well. Together, they have to be just permeable enough to keep the bag’s artificial atmosphere in balance – the wrong ink alone can suffocate a salad. As the lettuce sits on the shelf, the gases in the bag are constantly consumed, released, and replaced. Oxygen, nitrogen, and carbon-dioxide molecules bond with the polymers on one side of the plastic and are released on the other, diffusing from high concentrations to low. Every type of salad requires a different type of bag, tailored to its respiration rate by gas chromatography and computer analysis. Every bag is a miniature biosphere.
That’s from the recent double-issue of The New Yorker, Sept. 6, p.140; it is devoted to food and may be the finest issue yet under Remnick’s tenure. And here is a brief defense of eating from salad bags.
De Gustibus…
A Malaysian woman is trying to reclaim the world record for the longest stay in a room full of scorpions, news reports said Sunday.
Nur Malena Hassan, 27, moved Saturday into a locked glass box where she plans to live for 36 consecutive days with more than 6,000 of the poisonous arachnids in a shopping mall, the Malay-language Mingguan Malaysia newspaper reported.
Scores of people watched as Nur Malena stood fearlessly in a red sweater and jeans with scorpions crawling up her head, chest and legs in Kuantan, a city about 350 kilometres (160 miles) east of Kuala Lumpur, a photograph published by the newspaper showed.
Nur Malena set a world record in 2001 by living for 30 days with 2,700 scorpions. She was stung seven times, fell unconscious and almost gave up the attempt.
Her record was shattered a year later by Kanchana Ketkeaw, a woman in neighbouring Thailand who lived in a similar glass room for 32 days with 3,400 scorpions.
Under self-imposed rules, Nur Malena is expected to leave the glass room just once a day for 15 minutes at a time. She will sleep, eat and perform Muslim prayers in the room.
The woman gives herself a 50-50 chance of making the record. She claims that the nighttime is worst, since scorpions are especially active then. On the brighter side, scorpions rarely sting unless disturbed, so a quiet posture yields dividends. Furthermore she has built up immunity over the last six years by allowing herself to be stung repeatedly.
No doubt her fear will be more impressive than that of the previous recordholder: “Having 6,000 scorpions is different from 3,000 [TC: hey wasn’t it 3,444?]. It’s just worse.”
When bored during her ordeal, she watches DVDs; her current favorite is Spiderman.
Here is one account, I have drawn further information from the Mexican edition of the Miami Herald.
And why is she doing it? In her own words, “I want to show that Malaysians are capable of world-class efforts.”
Mexican economic growth – a revision
My good friend, the ever-reliable, ever-intelligent Kevin Grier, writes to me the following about Mexican economic growth:
I believe the primary two problems with mexico are both political (1) very little real competition in the domestic economy (2) no true rule of law. Fundamentally its still a society where personal connections or bribes get lots of things done. The “ideal” of everyday anonymous transactions working out well even when there are time intervals between beginning and end (payment and reward) just is not there.
Also the Mexican civil war at the beginning of the 20th century probably had something to do with the low growth in the first half of the century. That was no joke, that war. The “golden years” could easily be high transitional growth getting back on the BGP after the devastation of the civil war, kind of Mexico’s mini version of the Japanese and German growth miracles after WWII.
imho Mexico is middle income due to “location location location” and is still chained to an almost feudal social and political system.
More specifically, Kevin points out that the available data show Mexican convergence to the U.S. from 1950-75, and from 1870-1900, but not for the twentieth century more generally, I offer apologies for my previous error.
Addendum: Don’t forget to check out Kevin’s Haitian art page, or his music tastes.