Raise the gas tax

Thomas Friedman
Bob Inglis and Arthur Laffer

Megan McArdle: The finanical sector is not the automobile industry

Invidious Comparisons, part II

There are some really good points here. Among them:

[F]inancial executives have been fired in large numbers and taking pay cuts that reduced their income to a fraction of what was expected six months ago. Auto workers have not. Financial firms are in the process of laying off hundreds of thousands of their best paid workers (50,000 at Citibank alone); auto firms are not. …

[V]arious investment banking groups that specialized in equity and corporate bonds and wouldn't have known a CDO if it bit them on the ass; corporate and muni bond traders; cap markets guys, and so forth. All their markets dried up because of a credit crisis that they cannot even arguably be credited with creating. It's no more fair that they have to sell their house … and try to figure out what the hell they're qualified for, than that autoworkers have to. Less, maybe, because the autoworkers have had a lot of warning that their companies are on shaky ground … Apparently the message we want to send is "Don't go look for a high-paying job; get a picturesque one." …

No one in the financial industry declared that their salaries and perks weren't on the table until some vague and unspecified date in the future, as the UAW has. Actually, from what I understand, the CEO of Lehman tried to, and he was rightly told to go piss up a rope. …

The financial industry was bloated, the salaries out-of-whack with any possible real economic value they could be argued to have provided to anyone, and that will have to change--but we don't need the government to ensure that, because the industry is contracting rapidly, and the worst-hit parts are exactly the places that were most out of line with economic reality. …

And I think that most of the people who Hilzoy thinks of as picking on the auto workers would be willing to accept a deal in which the Big Three got some funds in order to put its balance sheet back together, then started firing people at will until they were small enough to make a profit again.

I've thought a lot about things like this, especially the loss of low-skill, relatively high paying jobs. On the one hand, I like the kind of social order where someone can go get a goodish job right out of high school and raise a family on that (even though I really don't understand those kinds of people at all . . . I was never raised with the idea that not going to college was even an option, let alone a good idea). There's a kind of inherent equality in such a society; even the little guy without great educational opportunities can live comfortably and securely in his place (I don't mean that as snobbily as it sounds. My future social standing is not in any way set in stone.).

On the other hand, I don't see any moral imperative to expend resources to preserve such industries that are not self-sustaining, and certainly not those that have wastefully burned through resources at the rate the American auto industry has. The basic arguments for free markets in most cases are convincing; if someone can manufacture cars more cheaply (Japanese firms), they should. If a for-profit enterprise is unprofitable, it should not exist (and it would be horribly inefficient to turn the auto industry into an insiders-only welfare program).

As for the autoworkers themselves, I have no problem with them being generously helped directly through programs to help them move, obtain training, keep health care benefits, and so forth. But if your specific employment does not add value at the margins, you should be fired and get different employment.

It really isn't very complicated.

Wood-based plastic alternative

msnbc

Bickering among academics

Mankiw and Krugman at it again (unless I completely misunderstand the tone of the exchange).

Recipient of BYU honorary doctorate admits to war crimes on TV . . .

ABC News

Commentary:
The Daily Dish, also here
The Raw Story
Ross Douthat takes a less outraged stance that I can sympathize with. He still accepts the basic facts (since they are basically indisputable).

If the world were just, would senior Bush people be charged as war criminals?

The Washington Post: Pack of Liars

Yesterday's bipartisan Senate report on the abuse of detainees in U.S. custody at Guantanamo, Abu Ghraib and elsewhere doesn't just lay out a clear line of responsibility starting with President Bush, it also exposes the administration's repeated explanation for what happened as a pack of lies.

"The abuse of detainees in U.S. custody cannot simply be attributed to the actions of 'a few bad apples' acting on their own," the report finds. "The fact is that senior officials in the United States government solicited information on how to use aggressive techniques, redefined the law to create the appearance of their legality, and authorized their use against detainees. . .

The actual senate report is also worth reading (only 20ish pages).

Joe Stiglitz: No Bailout for Auto Industry

FT.com: Chapter 11 is the right road for US carmakers

So it's basically unanimous among people who know what they are talking about and who don't have a vested interest in the US auto industry. Businesses that don't produce items that people want to buy or trust for quality should not be rewarded with taxpayer money.

Wow, sucks to be Laos . . .

Forty years on, Laos reaps bitter harvest of the secret war

How about $15 billion to bailout Laos since . . . you know . . . this problem is all our fault?

Space Teddy Bears and Invisibility

Out of this world
The Art of Invisibility

Santa's Gmail inbox

Kinda funny in a "don't get mad at me if you are offended by this" sort of way. Here

Update locally hosted (other link is dead)

Weird shiz in Thailand.

So I don't know if you've been paying attention, but the middle classes in Thailand are revolting because they don't want the peasants to vote, and they've actually overthrown a couple popularly elected governments in the last several years if I'm not mistaken. This is not supposed to happen. Before I blab on too much, here's the article that prompted this post.

By most narratives, the road to democracy from feudalism begins with economic liberalization, which fosters a powerful bourgeoisie that eventually overthrows the aristocracy/nobility (violently in America's case, or gradually in places like Great Britain). Think about the movie Amazing Grace when Wilberforce plays poker with an aristocratic fellow member of the House of Commons. The Noble raises the stakes and someone reminds him, "Your Grace, you know these merchant boys are richer than we are."

This narrative isn't playing out in Thailand. The bourgeoisie is now rioting in favor of anti-democratic reforms to the government. Looks like the mainstream narrative is wrong, or at least misinterpreted.

I tend to think it's partially wrong at least. The United States Constitution, for example, is not nearly as democratic as people think. Last summer, my personal project was to read James Madison's notes of the Federal Convention. And really, the vast majority of the founding fathers were not democrats (small "d"). Except with James Wilson and maybe a couple of others, a general distrust of the common people prevailed.

The United States Senate was put originally in the hands of the state legislatures for that reason (and there were even proposals to have them specifically elected by the economic elites). And in all the debates about "minority rights" they aren't talking about black people (obviously) or religious minorities for the most part. They're talking about rich people – they were afraid the people would try to confiscate their wealth.

It's possible that Thailand moved too quickly to a modern-style popularly elected government and now the middle class is up in arms, just as they may have been here had such reforms been put in place in the very beginning before loyalty to our constitutional government became a cultural and (almost?) religious necessity for anyone who wants to be accepted in polite company. Could a similar thing happen in China (which would shake most of the reason American foreign policy justifies such close economic and diplomatic ties with a communist country). Should we care? Is there any reason to think a free market (which is mostly where we get our benefit from other people's democracies I think) can't function in a partially non democratic regime? Anyway, it's interesting to think about.

This is pretty messed up . . .

Yes, it's the end of the semester and I don't feel like thinking about anything remotely serious.
Here's the link.

Update: here too.

Most enjoyable time of avoiding my homework I've had in a while

http://basicinstructions.net