Monday, January 31, 2011

Good Monday morning to you all. We are getting ready to do our weekly shopping today because a storm is forecast starting tonight with a second wave due tomorrow afternoon into Wednesday. Total snow is expected to exceed 15 inches and we are supposed to get our old friend 'Lake Enhanced Snow.' Most of the weather people expect the storm to place in the top five of historic snow makers. Anyone who has read some of these blogs knows our pattern--snow or deep freeze temps put us into hibernation mode. Nothing short of an emergency will get us out of the house.

I agree, Lois, about the amounts of money we spend on various countries around the world. I have known for years that we have been supporting a number of governments over there with huge amounts of money. I rather doubt that the $1.5 billion Egypt gets each year is the sum total. And getting rid of it will be a real challenge. One of the news reports speculated that the one group Mubarak could count on was the military because he made sure they were well equipped, well paid and generally well taken care of. Given that the U.S. is the largest arms dealer in the world, I have to wonder how much of our foreign aid is given in military equipment or is given knowing that the money will be used to buy our equipment. Quite a bit I would think. Think of the dent in the budgets of, especially, red states whose economies are heavily supported by the 'military-industrial complex' if that stream of cash were interrupted. Egypt some, very few, news reports noted is second only to Israel in the amount of foreign aid received from the U.S. I wouldn't doubt, but haven't seen any listings, that Saudi Arabia is not far behind.

I read some interesting posts over the weekend that present ideas about the Egyptian situation that have not made it into the mainstream press. Most of us forget that all of Egypt's presidents since the army overthrew the monarchy in the 1950s have been military officers: Nasser, Sadat, and Mubarak. The army hasn't played a very prominent role in Egypt very often; it doesn't need to since the presidents have all had close ties to the army. Mubarak had been grooming his son to replace him but Gamal Mubarak doesn't have the kind of ties to the army that his father has had. The army has been conspicuously restrained in its handling of the demonstrations, although that may be changing if the early morning news is any indication. The only significant change has been Mubarak's appointment of his former security chief, who has close ties to the military, as his vice president (and presumed successor). Mubarak has steadfastly refused to name a vice president in all his thirty years in power--until now. It makes me wonder if the senior army officers haven't decided that the time has come to make sure that Mubarak's successor is someone they approve. If so, I can see a continuation of the same old, same old. No liberalization, no democratization. And we will support it.

Considering that the political turmoil in Tunisia, Algeria, Egypt, Sudan and Yemen stem most directly from rising food and fuel prices, this story (and others like it which don't find their way into the mainstream media) should spark our interest. It is nice that the futures prices of grains are expected to fall about 5% over the year but that is after a rise of 50+% over this last year. I have noticed that our news media have devoted more time to food inflation over here but I have not noticed anyone connecting the dots. What dots, you ask? Weather (droughts, floods, severe storms) to lowered crop yields to higher prices to political turmoil. Those dots. Oh, I almost forgot! Recent failures of Monsanto's GM corn and cotton in several countries which, of course, Monsanto says was not its fault.

Sunday, January 30, 2011

Good Morning, everyone. Our last snow didn't amount to too much. I think we may have gotten 2 inches out of all that gloom last week. They are telling us to brace for a storm that may produce the largest amount of snow in several years. We will do our weekly shopping before it comes in. Mom had a cute quote on her home page this morning: Weather forecasters are right often enough that we have to take not of their forecasts; but they are wrong often enough that we can't rely on them. We'll see how this forecast turns out.

The big story has, of course, been the uprising in Egypt. For the most part I don't have much to say on it. Every now and then some talking head spouts some idiocy that irritates me but for the most part I am content to be a spectator and let the Egyptians settle the matter themselves. One piece of idiocy came Friday, I think, on CNBC. The main thrust of their discussions was how to benefit as an investor, which doesn't interest me at all since I have never had anything to invest. However, one of the pundits mentioned he was acquiring more defense stocks because all the talk about cuts in military spending, he thought, would come to nothing thanks to the situation in Egypt. My first reaction was: WHY??? We already spend more on 'defense' than all other countries put together. And we aren't really getting all that much for all that cash. And then there is the question of what we have been getting for the $1.5 billion/year we have been spending on Egypt. Only a couple of news reports said anything at all about that. Most say we are hoping for a moderate replacement for Mubarak but I wonder if our definition of 'moderate' is anything at all like what Egyptians would want.

Now we have the potential for protests in another northern African country: Sudan. I am not surprised that the trigger is the same as for other countries there: the increase in the price of fuel and important food commodities. That, of course, is exacerbated by the referendum over the last couple of weeks concerning independence for the oil-rich Southern Sudan which is running about 99% in favor.

Friday, January 28, 2011

Good morning to you all. We had some snow yesterday. Thankfully, nothing like the system that hit the northeast. I noticed that everyone is scrambling to explain this years snow phenomenon. I am not so interested in an explanation--I simply want to know when to hibernate.

Well, this didn't take long. The Republicans are once again floating the notion of Medicare vouchers to 'reform' the system. Thank you, Paul Ryan. (sarcasm alert). Look, I can agree that we do need to do something but our politicians are, as usual, attacking the problem from an angle likely to give the least benefit in terms of the desired action (curtailing costs) and the most pain to those who have the least impact on rising costs (the patient). We have a medical education system from which doctors graduate with (if they are lucky) debt in the mid to high six figures. It has to be paid back somehow. We have a high tech medical system whose practitioners show little discernment (I would say discrimination but people often forget that the term has a good meaning) in how, when and why the high tech toys are used and use those high tech toys to cover their asses rather than treat patients effectively. We have a medical malpractice system in which the malpractice insurance providers whose premiums are more correlated (inversely) to stock market losses than malpractice judgements, and we have a professional association that is more interested in covering everyone's asses than getting rid of bad actors. Furthermore, we have consumers who demand a medical cure for all ills with no negative side effects. Vouchers will make effective medical care far more expensive for those who can least afford the expense and will do nothing to curtail the costs (read profits) of drug companies, hospitals, medical insurance providers, and the medical technology industry. Perhaps that is exactly what many of our politicians want.

I noticed yesterday that resistance is growing among some of our Senators and Representatives to the proposed cuts in the defense budget. I wasn't surprised. After all defense contractors are among our most profitable companies upon whom many of our politicians rely for the massive amounts of money it takes now-a-days to get elected and many of our communities rely for jobs and other economic benefits. Andrew Bacevich has a very good piece on Tomdispatch this morning explaining how very well protected the military sacred cow is and how difficult it will be to do more than restrain the growth of military spending even though it has been pointed out repeatedly that we spend more than all other countries combined and are getting very little in return on that investment. And, as Bacevich points out, corporate profits, though not negligible, are not the most powerful factors in this debate. More important are historical, cultural, psychological, and institutional investments in the system as it is--however inefficient or ineffectual.

Thursday, January 27, 2011

Good morning again, everyone. I am still mulling over the SOTU trying to sort out some of my rather contradictory feelings and thoughts about it. I was very glad that the 'co-ed' seating arrangement (as far as it went) put a damper on the rowdiness and rudeness that was so evident last year. Obama made some very good points but, as he said and I often say, the debate will be in the details. I agree, Kay, with your observation on your 'Small Stones' post and on your comment here. I don't feel at all reassured and I wonder when the knife will hit my back.

But I think my uneasiness comes from something deeper. Both parties are living in some kind of La-La Land seeing only what they want to see and trapped by what I think are very fuzzy visions of where we came from, where we are, and where we might be going.

I'll start off with the Democrats. It is nice that the President mentioned the need to invest in refurbishing our infrastructure but where is he going to start? I have read stories for the last 3 decades about crumbling roads and disintegrating bridges. The estimates from engineering experts on what the bill would be to fix the country's roads and bridges alone just about equal the yearly deficit. Where is the money to come from when the cumulative deficit just about equals our GDP now? That is just fix the roads and bridges we have now not extend the system. To use much of the 'green' technology for electric generation we have to upgrade the electric grid also which some experts say is worthy of a third world nation. For some humorous takes on the problem look at these political cartoons on MSNBC. And, much as I hate to agree with the Republicans on anything, simply 'cutting' the budget in some areas to create 'new investments' in others doesn't really change the economics of the situation. It is rather like a consumer paying one credit card with another.

Then there is the issue of 'clean energy.' As this piece from MSNBC makes clear much depends on how you define 'clean.' Also many of the technologies depend on large energy inputs to create the 'clean' energy in the first place which means that the final energy resulting from the process is quite expensive. Let's also ask about the financial inputs here. Where is the money going to come from and can consumers afford the energy produced? And which consumers are we talking about? A recurring story in our local news concerns the problems low income people have paying their utility bills during the winter and the increasing demand for low income energy credits to help the process along. Last summer, during our heat wave, a similar story cropped up when the air-conditioning bills came due. It is nice that the President focused part of the SOTU on energy but we are already tripping over the technical and financial details.

What about education? Well, the basic question I want answered simply aren't asked. Education for what? The President mentioned that so many jobs that once required a high school diploma now require at least some college. Why? I have said before that we have become a nation of clerks selling goods made overseas to other people who sell goods made overseas to...ad infinitum. You don't need a college education to punch a damned point of sale computer. (I almost wrote 'cash register' here. I guess I am showing my age.) Also who pays since college educations are becoming even more expensive?

And then there was the issue of competitiveness. This had the feel of football boosterism about it. The problem is the metric by which we measure competitiveness. Is it the proportion of college graduates in the population? Why? Let's be clear here--no matter how many college graduates we churn out we can't match the number a society like China can produce. Think about it--our 300 million versus their 1.3 billion. Even if we educated 100% of our people to the bachelor's degree level they could exceed our numbers by merely educating one-third of their people to that same level. We are number one in the world in two other metrics which are of dubious value. We spend more than anyone else on health care and we spend more that the rest of the world put together on defense and we have gotten very little bang for those massive bucks.

So much for the Democrats. Let's go on to the Republicans. They have been singing the praises of 'small' government that simply gets out of the way and lets individuals and businesses get on with the important work of making 'us' prosperous. I have to ask: what you mean 'us,' white man? The problem is they are still enthralled by the tired old notions of 'trickle down' and 'a rising tide lifts all boats.' Most of us have been trickled upon by bodily excreta, not prosperity and our boats, which have been leaking for a long time, have now capsized. I don't see any rescue for us anywhere in sight. How far back do these 'small' government apologists want to go? How about the Articles of Confederation? That was small government--no executive, no judiciary, legislation by committee. The British had a very good chance of reabsorbing the so recently independent states into their empire because of the ineffectiveness of the government established by the Articles. But, by God, it was small.

Oh, you want to go back to the Constitution as the Founders originally created it? That is nice except for the simple fact that the country has grown spectacularly since 1789. At that time we had a bit less that 3 million people (not counting Native Americans, I am sure), controlled none of the territories west of the Mississippi or North of the St. Laurence or any of Florida. We didn't have utilities whose pollution plumes followed the wind across the entire continent or concentrated animal feeding operations whose wastes polluted entire rivers and local groundwater. As various problems have risen over the last 200+ years that have transcended the state boundaries or the capacities of the individual states to handle, the Federal Government has grown. We can argue whether the Federal Government should be funding traffic lights at the corner of Local and Main, or 'bridges to nowhere,' or whatever other inane project you can name. But we cannot run a country with 100x the population and three times the territory with the government that existed in 1790.

Ok, Republicans want to cut spending. Lets talk about some of the spending priorities they have supported over the last decade. Start with Iraq and Afghanistan. Much of this was funded completely off the books during President Bush's tenure in office. And most of it has been a total waste in money, materiel and lives. Has anyone else noticed the increase in suicide bombings in Iraq lately? There have been numerous stories about reconstruction projects in Iraq which are so shoddy and so out of line with what the area needs that the are a boondoggle of the worst kind. Billions put into this with nothing to show. How about TARP? Started to buy up toxic assets so beleaguered banks wouldn't be sunk by the weight of their own stupidity and then changed to a program which loaned (?) money to those banks with almost no strings attached. Yes, much of it is being paid back but we are in almost the same situation with respect to the 'too-big-to-fail' financial institutions as we were before the crisis. And where have the Republicans been with regard to moral hazard for stupidity at the top of the financial food chain? Largely, missing in action. They really don't want to offend their major donors.

I think I will leave this discussion here. As you can tell--I am not terribly happy or satisfied with any of our politicians right now.

HuffingtonPost put up this article this morning. What sets off the warning bells in my little brain isn't anything said in the article; rather it is what isn't said. How many of the President's past and present economic advisors have very close ties to Goldman? I sometimes wonder if his appointment of William Daley, a long time executive with JP Morgan, was simply a nod to 'financial diversity.' A number of people have noted that the economic advice the President is getting is coming from people who have close ties to the companies at the center of the 'Great Recession.'

I think I will get off this rant now. It has gone on quite long enough. Pox on both their houses.

Wednesday, January 26, 2011

Good morning, everybody. I did watch the State of the Union last night and the Republican 'response.' I put that word in quotes because Rep. Ryan did not respond to the President's speech. He instead repeated the same tired generalities you would expect from the Republicans; the same ones we heard before the SOTU.

The New York Times headline today calls the SOTU and the Republican response a 'clash of philosophies.' And, I think, they are right. But they fail to show exactly how deeply rooted in our history this clash is, or how often the boundaries of our different levels of government have had to be renegotiated. We see similar argument in the Maysville Road Veto of 1830 where Andrew Jackson held an opinion similar to what that of the Republican/Tea Party position today. Jackson's position might have prevailed 125 years later when President Eisenhower pushed through the interstate highway system if it had not been pushed as a defense measure during the early years of the Cold War. Most people forget that the Federal-Aid Highway Act of 1956 is more popularly known as the Interstate and Defense Highways Act. Those who want a strictly limited role for the Federal Government forget how much of a role the Federal Government has played in our national development. Railroad entrepreneurs pushed into the heartland of the United States well before enough people had moved in to make the venture economically profitable. The Federal Government tipped the equation by giving very providing generous land grants of Federal land (rights of way) to the railroads which then encouraged new settlement by selling parcels to newcomers. The transcontinental railroad was part of a Federal strategy to make sure that California (with its very important gold fields) became an integral part of the Union at a time when the issue of California statehood was very much in contention. Republicans and their business supporters complain complain about government intrusion but in truth government has always intruded. Republicans and Tea Partiers seem to believe that once upon a time we had small government that left business alone because our political leaders adhered to the Constitution. That is pure nonsense. Obama's call to streamline our government, restructure out tax codes, cut unnecessary expenses and invest in rebuilding infrastructure, innovation, and restructuring education is prudent. Perhaps they should look at Japan before they had their own overheated real estate market collapse and how they used the Ministry of Trade and Industry to out transform their industrial economy from one only capable of making cheap toys to one that could give our industries serious problems. Unfortunately, I don't think either side will be able to think outside their very narrow boxes, conservative or otherwise. They are all constrained by political and economic orthodoxies that have reached the intensity of religious orthodoxy. They should remember Moses did not deliver an 11th commandment saying 'Thou shalt adhere to Predatory Capitalism' along with the other ten. And Jesus did not proclaim that capitalism as the path to salvation.

Juan Cole, in a post at Tomdispatch, provides a revealing commentary on U.S. foreign policy in the Middle East. Call it a case of 'same song, different verse.' Again our foreign policy leaders, also, seem unable to break old habits of thought.

We seem to have had a lot of snow out here in the last three months but, according to our weather people, the appearances are somewhat deceiving. The snow level is actually several inches below what we would normally expect. Also, the amount of rain and snow melt is still 6+ inches below what we should have received over the last five months. So even with all this snow we can't say that the 'extremely dry' conditions have abated.

Tuesday, January 25, 2011

Good morning, everyone. There is always something in the news to raise my Contrary hackles. This HuffingtonPost item did it right off the bat. It is nice that the some Republicans in the House are now willing to consider alternatives to what we are doing in Afghanistan. But the section that refers to the cost to "further the Obama Administration's stated strategic goals." What in the hell happened to the Republicans who gave Bush a blank check to play cowboy over there? Who set the goals in 7 years of war in the first place? Let's apportion the blame properly here and not try to rewrite history with self-serving crap!!! Interesting that they want to reassess now that they are not calling the shots.

Well, it looks like the mainstream media is taking a little note of the rising food prices. CBS posted the Michael Klare article I linked to yesterday. CNBC yesterday had several segments on the subject but mainly dealing with how investors can profit from it. I wonder how many more outlets will suddenly find the topic. CNBC is continuing the theme today. They showed an interesting map showing the level of price increases and it is most severe in the developing world. They explained away the severity of food inflation in Australia with the floods and remarked that the situation is transitory. Problem--the floods come after a severe multi-year drought and parts of the country is still in severe drought.

The State of the Union is tonight and the comments have been coming fast and furious on what people think Obama might say. House Majority Leader Eric Cantor panned the leak which claimed that Obama is going to propose 'investment' and dismissed it as a Democratic euphemism for more spending. He claims Republicans want 'real' spending cuts but of course failed to specify what he meant by that. It is so nice to snipe without proposing anything you might be criticized for. The problem is that we really do need to make some investments in several areas. CNBC yesterday had a segment on infrastructure and noted that our systems of river transport, airports, public transit and others are woefully outdated. On the topic of airports the newsreader noted that air traffic has increased by 7% but we have not invested in new airports or runways. In Chicago, the city government has been trying to get a couple of new runways built at O'Hara and have been stymied at every turn. They just got the land issues settled after going through several law suits but now the airlines are balking because they have to contribute to the funding. They want the new facilities but they don't want to pay anything for it. We haven't found a way to agree on much of anything else and I am not optimistic that we will agree on what an 'investment' should be.

Monday, January 24, 2011

Good morning to you all. There wasn't much to comment on yesterday. The Bears playoff game dominated our news and I think most sports 'news' is a waste of time. The loss is dominating this morning's news--an even bigger waste. Oh, well, that's entertainment.

It is still cold with periodic snow or other precipitation. Some areas south of us are expecting ice. Hopefully, we will miss that. But I notice that I am not the only one in the blogosphere keeping warm perusing the seed catalogs and planning the spring planting. My seed orders came in so I sat myself down and actually planned what I will plant and where I will put it. I checked out the plans yesterday to make sure I had a place for everything I had on my list and made a couple of minor tweaks to the plans. What's on the agenda, you ask?

Well, peppers, of course. I decided not to put in any sweet peppers this year. The farm markets are full of those. Top on the list is the False Alarm (very mild jalapeno style hybrid) and Zavory (mild habanero hybrid) both from Burpee. I added the Vietnamese Multi-color hot from Baker Creek (an heirloom variety). All are small and I want to pickle some as well as freeze a batch. The False Alarm has been reliably prolific over the last two years.

Then, tomatoes, and absolute must. I still have Fresh Salsa ) (Burpee hybridseeds so I will continue with them. They did the best of all the tomatoes last year and produced heavily. The Brandywine and Big Rainbow (heirlooms) didn't do nearly so well thanks to the heat wave that hit just as they were blooming and the sun damage didn't help either. I will start them and the peppers early under plastic tents and I plan to provide shade from the worst of the sun.

I will continue growing stevia, thai basil, lavender, and sage but will add marjoram, rosemary, oregano, and sweet basil.

I have a number of new categories this year: the Tigger melon, Dragon's Egg cucumber, Blue Lake pole beans, and Aunt Molly's ground cherry. These are all heirloom varieties from Burpee (beans) and Baker Creek (mellon and cucumber). The ground cherry was a gift packet from Jung with our order of the little greenhouse and a total surprise. I am very interested in how it will turn out.

Greens will include Bull's Blood beets, spinach and three varieties of lettuce. Actually, there are more varieties of lettuce because I will be planting the Heatwave mix from Burpee for the middle of the season. These didn't do well last year but I hope the results will be different this time. We do like our salads.

For pure decoration I am putting in the dwarf marigolds again along with Love-in-a-Mist, Black Peony poppy, and Teddy Bear sunflowers.

Though I love looking at the seed catalogs I find my enthusiasm often outruns my garden capacity. Everything looks and sounds wonderful. But I have a very small space so many of my choices are restricted to what plants that may fit in well in that space. The melons produce small fruit and I have several large pots that can be fitted with a trellis. And I have some pots that, I think, are big enough for the poppy and sunflower both of which grow to 4 ft.

On to other things. I don't find this New York Times story all that surprising though the time line does raise my eyebrows a bit. The story started unraveling about five years before the housing crisis hit. The rot in the mortgage industry is pervasive and cleaning it up will take a long while. The first step has to be a social attitude adjustment on two points. Ordinary Americans can't think of homes as 'investments' the way stocks are investments and count on them for a windfall return. Second, homeownership is not for everyone as it has been touted for the last thirty years. The we have to clean up the mortgage servicers and banking industry but not by turning the whole thing over to the big banks as some recent articles have claimed representatives of the industry are lobbying for the government to do.

I am not all that surprised by this Reuter's story either although I notice that not much attention has been paid to the issue over here. We heard about Sarkozy's visit to the U.S. but not much at all about his agenda. Nor have we heard much about the rise in food prices world wide or about the increase in the commodities that lie beneath the rising cost of food. It is interesting that Sarkozy wants to go after 'speculators' and he may have a point in doing so. But speculation in the commodities market may be a smaller part of the problem than he thinks. We all heard about the heat wave in Russia last summer but only snippets about the Russian Government's ban on wheat exports which put a serious hurt on their major customers, including Egypt and Indonesia. We have heard about the floods in Australia which has devastated Queensland and is now proceeding into Victoria. But think about this--it is early fall down there and what ever crops were growing there are gone. We have heard absolutely nothing about the floods in Indonesia and Sri Lanka which have put a severe crimp in rice production or about the severe winter in Vietnam which has killed, reportedly, some 10k buffalo with the numbers rising. Southwestern China, a major grain growing region, suffered a severe multi-year drought followed by massive flooding and now severe winter snows and freezing. I haven't read a final tally for the American wheat and corn crop but both are down and reserves are at a multi-decade low while the Canadian wheat farmers took a big hit on the heat wave that hit there. Weather, it seems to me, may be a much bigger problem than speculators. Michael Klare at tomdispatch has a good post this morning which puts the whole issue in a very nicely balanced perspective. Speculation is only one leg of a very wobbly three legged stool supporting global commodities--decreased production (due to nasty weather or increased production costs) and increased global demand being the other two.