Current Affairs & Politics

Nobody Speaks for #OccupyWallStreet

Adbusters occupy wall street

I think it is critical to spread the word of where Occupy Wall Street came from, because as it gains momentum, we are seeing many political groups trying to bend it to their wills.

Occupy Wall Street began as a single-issue protest.  It started when Adbusters posted a message suggesting a protest whose central demand is that President Obama “ordain a Presidential Commission tasked with ending the influence money has over our representatives in Washington.”  This is a broad-based demand that should (and did) unite people on all sides of the political spectrum, from ultra-Liberals to Tea Partiers.  In fact, as many point out, the target of the rage should be Washington as much as Wall Street.

Now, we are seeing lists of “demands” from a variety of parties who claim to speak for the few thousand people participating in the protests.  I am very skeptical of anybody who claims to speak for this group.  The lists of demands – several have been floated, all quite different – range from fairly specific legislative proposals to more whacko rantings of ultra-leftists.

And the groups which have stepped in to participate all have their own unique agendas.  Labor unions, for example, are supporting the cause – which is ironic, since labor unions definitely are part of “the influence that money has over our representatives in Washington.”  What’s next, support from Exxon?

What really got me suspicious was when I found out that was supporting the cause.  In 1998 I joined Wes Boyd and because it claimed to be an issues advocacy group focused on ending the impeachment of Bill Clinton.  I was no big fan of Clinton, but I was furious about the impeachment and its resultant waste and misdirected politics.  But instead of being a single-issue group focused on “moving on” from the impeachment, was instead a PAC raising money for the Democrats.

Lo and behold, I had apparently signed up as a card-carrying member of the left wing of the Democratic party.  That was hardly my intent.  I just wanted the Republicans to get back to the business of the Contract for America and off the stupid and wasteful impeachment proceedings.  I had been co-opted by a so-called “issue group” into a PAC for the Democratic party.  Likewise, I suspect a lot of people occupying Wall Street are probably rather surprised at the demands that “they” are now supposedly advocating.

That’s what happens when a movement gains steam – people get out in front of it and try to use it for their own purposes.

So ask yourself: how can labor unions and be in support of “ending the influence money has over our representatives in Washington” – they _are_ “the influence money has over our representatives in Washington!”

One of two things has happened / is happening.  Either

  1. The entire Occupy Wall Street protest was intentionally organized by Adbusters to tap into the general anger and then co-opt the group into a hard-left movement, or
  2. Seeing the success of the protest, a bunch of hard-left activists are trying to co-opt the original goal of “ending the influence money has over our representatives in Washington.”
So here’s a message to all the souls protesting in Wall Street: don’t become a shill for someone else’s agenda.

Lights Out In The Tunnel

In his new book, “The Lights in the Tunnel,” Martin Ford postulates an interesting (if not novel) thought experiment: what if the Luddites were right?

I have to start by confessing: I have yet to read the book.  I have only read this review of the book.  And looking at my schedule, I may not have time to read the book.  So my comments are not directed at the book, but at the synopsis presented by the reviewer.

The premise (according to the review) is that “the Luddite Fallacy will only remain a fallacy so long as human capability exceeds technological capability” and according to the analysis of his book, once that tipping point is reached, people will be unable to find work, and without jobs or purchasing power, the economic system will collapse.

On the surface, it makes sense.  Only large corporations will be able to invest sufficient resources to fully automate hospitals with robot doctors, produce food entirely without human intervention, or run governments with robot bureaucrats.  Over time, the means of production will be controlled by a small number of people who will aggregate weath, but with no jobs, there will be nobody to purchase products.

Here’s where this thesis falls apart: in a world where all work can be best performed by machines, the cost of a product is, essentially, the cost of the energy used to power the robots that provide the service.

If energy continues to be increasingly scarce, then the cost to automate becomes high relative to the cost of human labor.  For example, people will always be cheaper than machines if oil is the only way we produce electricity and costs $500 a barrel.  So the economics remain much the same as they are now – people will be used where they are cheaper, and robots will be used where they are cheaper – and the economy will move along.

So the premise – that the Luddite tipping-point is reached once machines achieve the technical capability of humans – is incorrect.  For the tipping point to be reached, two things have to hold true:

1. Machines’ technical capability must exceed human capability (Ford’s premise), and

2. The cost to power the machines is low relative to the cost to “power” a human

But, if condition 2 hold true, then Ford’s thesis falls apart again.  Here’s how:

Let’s postulate a world in which energy is so abundant it’s practically free, perhaps by having robots that operate on internal micro nuclear reactors or robotically-built multimillion-acre solar and wind farms.  In this world, the cost to produce something by robots is, basically, free.  After all, the cost of the raw materials in your cars is negligible.  It’s the cost of transforming iron and sand and oil into steel, glass, and rubber that costs money.  And the cost to transform something (raw iron to steel) is equal to the labor cost (the workers) plus the energy cost (the energy used to fire the smelters).  In an all-automated world, the “labor” cost equals the energy cost. If energy is practically free, then the products will be practically free, too.

Viewed in this way, it’s much more a Utopian fantasy than a Luddite nightmare.


Hate to say I told you so, but in April 2009 I wrote:

The keyword to watch for now is #doubledip.  Because with the recent uptick in the economy, the investing world is going to start looking for signs of a double-dip recession.

Now this article confirms my prediction:

The prices of single family homes in March dropped to their lowest level since April 2009, confirming a “double dip” because values are now below where they were since the housing market collapsed, according to a closely watched price index released Tuesday.

One Injury, Ten Countries

An interesting concept – author with a bad shoulder travels to 10 countries seeking various solutions, then writes about his experiences with various forms of health care in each country.

Something leapt out at me.  Although the book treats this as tangential, I found it strikingly salient:

In an Ayurvedic hospital in India, a regimen of meditation, rice, lentils and massage paid for entirely out of pocket, $42.85 per night, led to “obvious improvement in my frozen joint,” Mr. Reid writes, adding, “To this day, I don’t know why it happened.”

Well there you go.  Arrogant Western medicine does, in fact, have an awful lot to learn from Eastern.  In most of the countries he visited, surgery and steroid injections are de rigeur.  He had to practically travel to the Third World to learn that an inexpensive and risk-free solution was possible.

For over a decade I struggled with a variety of back problems, rejecting the expensive and very risky surgery for so-called “physical therapy” all based in the best Western science has to offer.  A couple months of hatha yoga (Bikram yoga, to be exact) and my back and other joints are as healthy as they were at age 18.

Go figure.  Maybe after a thousand years, those crafty Indians actually figured something out after all.

I think the author – and the NYT article – miss the whole point.  The NYT writer comments that “the comparative merits of different orthopedic philosophies are secondary here.”  Not so fast, Abby.  I don’t think it’s secondary at all.

Perhaps if Western medicine comprehended – and Western insurance covered – valid and often superior forms of treatment like hatha yoga, the United States wouldn’t be in a health care “crisis”.

My Solution to the Health Care “Crisis”

I have a solution to the purported “crisis” in health care.  Here goes:

  1. We will select one insurance company which we will allow to gain a monopoly over the entire health care system.
  2. We will give that insurance company the right to set whatever premiums it wishes.
  3. We will entitle that insurance company with the power to collect premiums by force.
  4. We will allow that insurance company to allocate health care resources however it sees fit, to whomever it deems most worthy of services.

Oh, wait.  That’s already been proposed.

Sorry, my bad.

A Teachable Moment

I know the rest of the world has moved on, but I thought I might just summarize the whole Gates / Crowley issue.

Clearly, institutionalized racism is still alive and well when an elite black professor at the nation’s most respected college, living in a city with a black mayor, in a state with a black governor, in a country with a black President can’t pop off at a white cop without getting arrested.

Hopefully, we can all learn something from this.

Question for the Class

Does anyone see anything a little wrong in this picture?

  1. The federal government, using our money, takes a 60% stake in GM, one of the world’s largest auto companies.
  2. Then, the federal government, using our money, pays buyers up to $4500 to destroy their used car (removing it from the market and driving up the prices for used cars) provided the buyer replaces the destroyed car with a new car.  Possibly a GM model.

Am I the only one?

Two Scoops

The keyword to watch for now is #doubledip.  Because with the recent uptick in the economy, the investing world is going to start looking for signs of a double-dip recession.

There’s every reason to predict another dip:

  • Profit taking from the current rally causes the market to drop again, possibly below 6500
  • Continued bad news in unemployment
  • Continued bad news in housing
  • Continued falloff in GDP
  • Failing auto companies

The list goes on.  Housing and auto sales are likely to have a double-dip feel to them as well.  Housing and auto sales have fallen far below their historical averages, so we should expect them to pick up, at least briefly.  But we shouldn’t expect strength in either sector as long as unemployment and overall GDP are falling.  That means a brief (1-2 quarter) uptick followed by another drop.

I’m expecting the current rally to end very soon as profit-takers force the market downward.  I don’t think we’ve seen the bottom yet.

The real question is: what is going to happen with the US auto manufacturers?  The government has shown little interest in helping out – about $12B in loans (compared to the trillions given to the financial sector).  The auto executives have gotten a bum rap.  Millions of jobs are at stake. Working class jobs.  Will these be saved?

If not, beware.

Coming Off the Junk

Remember “Change You Can Believe In?”

Remember how we were going to do away with earmarks?  Toss out the lobbyists?  Get away from old-school politics-as-usual?

“Hope” – remember?  Isn’t that why you voted for Obama?

Still feel that way?

Charles Krauthammer sums it up nicely:

It’s not just pages and pages of special-interest tax breaks, giveaways and protections, one of which would set off a ruinous Smoot-Hawley trade war. It’s not just the waste, such as the $88.6 million for new construction for Milwaukee Public Schools, which, reports the Milwaukee Journal Sentinel, have shrinking enrollment, 15 vacant schools and, quite logically, no plans for new construction.

It’s the essential fraud of rushing through a bill in which the normal rules (committee hearings, finding revenue to pay for the programs) are suspended on the grounds that a national emergency requires an immediate job-creating stimulus – and then throwing into it hundreds of billions that have nothing to do with stimulus, that Congress’ own budget office says won’t be spent until 2011 and beyond, and that are little more than the back-scratching, special-interest, lobby-driven parochialism that Obama came to Washington to abolish. He said.

Right.  He continues:

After Obama’s miraculous 2008 presidential campaign, it was clear that at some point the magical mystery tour would have to end. The nation would rub its eyes and begin to emerge from its reverie.

The hallucinatory Obama would give way to the mere mortal. The great ethical transformations promised would be seen as a fairy tale that all presidents tell — and that this president told better than anyone.

I thought the awakening would take six months. It took two and a half weeks.

I don’t blame you if you voted for Obama.  He’s young, smart, charming and progressive.  John McCain is old and Republican and uninspiring.

Let’s face it.  Obama’s message was like a shot of smack to a nation full of people junked out on the drug of mass media messages.  We, as a nation, don’t want to deal with our nation’s problems.  Obama promised that, if elected, we wouldn’t have to.  We got high on that message.

And now we gotta come down from the high.  Because like any drug, it’s a false reality.  The real one is still out there waiting for us.

Look, don’t get me wrong.  I don’t know that McCain would have been any better.  The ruling class in Washington – Republicans and Democrats alike – are all dead-set on one task: aggregating as much power as possible in the hands of the Federal government.

And they’re using the financial crisis as an excuse for immediate action.  We had choices.  There are other ways we could have stimulated the economy.  There were other alternatives.

None were heard.  There just wasn’t time.

So, from all the possible alternative solutions, we just happened to get the one alternative that most grows the size and scope of the Federal government.

Somehow, this country must wake up.  We’re entering a doomsday scenario:

  • a bankrupt government
  • using borrowed money
  • to bail out bankrupt companies
  • who lent borrowed money
  • to bankrupt borrowers.

It’s positively Escherian.