Semi-Daily Journal Archive

The Blogspot archive of the weblog of J. Bradford DeLong, Professor of Economics and Chair of the PEIS major at U.C. Berkeley, a Research Associate of the National Bureau of Economic Research, and former Deputy Assistant Secretary of the U.S. Treasury.

Saturday, January 20, 2007

Ethan Zuckerman tries to write for a dead-tree publication:

Ethan Zuckerman's musings on Africa, international development and hacking the media. January 19, 2007: The article I didn’t write. I haven’t written much about the One Laptop Per Child initiative in the past few months. This isn’t because little has happened with the project - in the months since I wrote a long OLPC post, we’ve seen a prototype of the machine, a factory-produced device, major work on the “Sugar” operating environment, and a finalization of the first five countries to pioneer the device. It also isn’t because I’ve lost interest in the device - I continue to be fascinated both by the audacity of the project and by the degrees of success it’s had so far.

I agreed to write a long piece for a well-respected technology journal about the laptop late in the spring of 2006. The editors of the journal asked - not unreasonably - that I not use in the information I was going to publish in that piece on my blog, and I agreed. I turned in a draft of the piece in early July, went through several edits with my editor, and generally felt pretty good about where the piece was going. (A slightly updated version of that draft is available here.)

But then the managing editor of the journal got hold of the piece, and I discovered they wanted something very different from what I’d written - they wanted critique, tension and controversy about the project. I got a draft back that bore very little resemblance to what I’d written - it was filled with international development clichés (”In a world where half the world has never made a phonecall, does it make sense to give children a laptop?”) and mean-spirited skepticism about the project (”if the laptops overheat, poor people can use them as pot warmers”.)

Basically, it wasn’t something I was willing to have my name attached to. And so I withdrew from writing the piece and told the editor I’d been working with - not the editor who’d demanded these changes - that she was free to run the piece under her name using my research, but that I wasn’t going to be associated with the tone or the conclusions of the piece.

So... eight months, several drafts and many, many unhappy phonecalls later, I’m not going to have the peer-reviewed journal article that I could hold up to my colleagues at Berkman to prove that, yes, I really am trying to be an academic. And I’m left with some questions that I need to think through before taking on an assignment like this again.

One of my best friends, Nathan Kurz, read through the draft I ended up refusing and helped me conclude that I shouldn’t allow it to be published. He flew home a few days later and read “The Best American Science Writing 2006″ on the flight home, which gave him a useful insight on my experiences. “I’d wager that about half the pieces had the same tone of breathless controversy that your editor added.”...

My concerns over the project have to do with whether educators will embrace the project or fight it, and whether the project’s aims will be embraced in developing world schools. But that’s more an open question than it is a breathless conflict. It’s possible that the draft I came up with is simply so boring that it couldn’t appear in this journal without some tension to draw in readers... but it raises the question of how one writes about science or technology when there’s no great drama unfolding, just progress being made.

The other frustration in this process is the timescale. When I drafted this article half a year ago, it was quite up to date and would have broken some new ground in writing about the project. Subsequently, Wayan Vota has reported much of what I’d planned to say on his excellent OLPC blog, and John Markoff has written the definitive OLPC article in the NYTimes. Even had I approved the last edit of the piece, it would have taken another couple of months to get through peer review and into print, possibly nine months from my first draft to publication. And this isn’t even that bad - I have a book chapter waiting for publication which is now over a year old - when I wrote it, it had up-to-date statistics regarding developing world weblogs. By the time it’s published, it will only be interesting as a historical document - not a single figure will be within an order of magnitude of accuracy.

It’s hard to figure out the value of academic publishing if you’re not an academic. When I write here, I tend to get critique - usually smart, well-informed critique - within hours. I often discover that I’m flat out wrong about something I’ve asserted, and I can update my opinions and impressions based on feedback from people better informed than I am. That seems like a much more efficient form of peer review - at least in the academic realm I inhabit - than waiting six to twelve months to find out whether an anonymous reviewer thinks my now-out of date paper is worth publishing...

Seems to me that there are two problems here: (i) the long time-lag in conventional publishing, which in fast-moving fields is absolutely deadly; (ii) a double-crossing of the subeditor with whom Ethan Zuckerman was working by her boss, who had not made the assignment or the expectations clear to the magazine's own staff, let along to Ethan Zuckerman.

Why I'm Not Going to Be Reading "The Politico" (Why Oh Why Can't We Have a Better Press Corps?/Special Preemption Edition)

Ah. By pure coincidence, the self-description of a Mr. Patrick Ruffini just crossed my desk. It reminded me why I won't be reading a publication, The Politico,, due to be launched on January 23.

Here's Patrick's self-description:

Patrick Ruffini is an online strategist dedicated to helping Republicans and conservatives achieve dominance in a networked era... as a campaign staffer, activist, and analyst.... Since 2005, Ruffini has served as eCampaign Director at the Republican National Committee, overseeing the Party’s online strategy for the 2006 election cycle.... Even during a difficult election cycle, the RNC’s relationship with the blogosphere grew closer and stronger than ever. Beyond these successes, the RNC’s eCampaign also serves as the Republican Party’s R&D arm for innovation on the Internet.... Ruffini has advised Republican candidates and organizations at all levels on best practices for winning online.

In the 2004 election cycle, Ruffini served as webmaster for Bush-Cheney ‘04 campaign.... Towards the end of the campaign, Time magazine noted the campaign’s adept strategy of reaching beyond official organs and touching voters through media they know and trust, among them the blogosphere.

Other professional highlights include a previous stint at the RNC during the 2002 cycle and time well spent at the American Enterprise Institute...

Patrick is an able, aggressive, and intelligent apparatchik for the current Republican point of view--not a great thinker with a solid reality-based position on policy, but a great communicator of facts, factoids, visions, and soundbites that tend to make potential voters look more favorably on Republican candidates.

This is of interest right here and now because of the great gap between Patrick Ruffini's self-description and how he is described by Politico honcho John Harris. In his attack on Dan Froomkin's White House Briefing column, Harris wrote:

PressThink: John Harris: [M]y reservations about [Dan Froomkin's] "White House Briefing" are... that... he is presenting a pretty standard liberal critique of Bush... [that would] not be appropriate at all for a news reporter.... I know most readers are not idiots and get the idea that we are sponsoring a blogger. But we know there is confusion on the point.... How Dan would be writing about a Kerry administration is obviously an imponderable. Does Dan present a liberal worldview?... [A] great many people would say yes.... I don't want them thinking he works for the news side.... Without agreeing with the views of this conservative blogger who took on Froomkin, I would say his argument does not seem far-fetched to me...

"This conservative blogger" is Patrick Ruffini. An alternative, more honest John Harris would have written:

Does Dan [Froomkin] present a liberal worldview?... [A] great many people would say yes.... This argument made by the eCampaigns Director of the Republican National Committee and the former webmaster for Bush-Cheney 2004 does not seem far-fetched to me...

Instead of:

Does Dan [Froomkin] present a liberal worldview?... [A] great many people would say yes.... [T]his conservative blogger['s]... argument does not seem far-fetched to me...

Quite a difference, yes?

When I first ran across this, I laughed. I figured that Patrick Ruffini had either accidently or intentionally caused John Harris to mistake astroturf for grassroots--that due to John Harris's poor online research skills, he thought that Patrick was a grassroots conservative weblogger rather than a paid Republican message apparatchik.

Then I learned that I was wrong: that John Harris knew damned well who Patrick Ruffini was and knew damned well whose payroll he was on. He just didn't think he should tell his readers. And I was dumbfounded. John Harris had the sourcing ethics of Judy Miller--the reporter who had promised Vice Presidential aide Scooter Libby that she would identify him not as "a senior administration official" but as "a former Capitol Hill staffer."

So I'm not going to be reading The Politico. There are too many smart, dedicated people writing things trying as hard as they can to tell me how things are for me to spend time reading people who are trying to tell me how things aren't.

Robert Frank on the political and moral economy of payday lending:

Payday Loans Are a Scourge, but Should Wrath Be Aimed at the Lenders? - New York Times: [T]he outrage currently directed at lenders who extend credit at extremely high rates of interest to economically disadvantaged groups. Among these lenders, so-called payday loan shops have come under particularly heavy fire.... [P]ayday lenders typically offer short-duration loans of several hundred dollars secured only by a post-dated personal check from the borrower.... Many borrowers... quickly get into financial trouble once they begin to roll over their payday loans.... The problem is that many people have difficulty weighing the trade-off between immediate benefits and future costs. When confronted with easy credit access, some inevitably borrow more than they can reasonably expect to repay. Once they get in over their heads, they borrow more....

[E]asy credit... is more like heroin and cocaine than alcohol. This evidence recently led Congress to cap the annual interest rate on payday loans to military personnel at 36 percent. In New York and 10 other states, similar restrictions apply to loans to the general public, in each case making payday lending effectively illegal.

Those who feel that payday lending is a bad thing are inclined to vent their anger.... But outrage directed at payday lenders cannot prevent those hardships, just as outrage directed at alpha male lions cannot prevent them from killing cubs. A more deserving target would be legislators who supported lax credit laws in exchange for campaign contributions from lenders -- or, better still, those who have steadfastly resisted campaign finance reform.

I somewhat disagree: there is something wrong with somebody who goes into a business where what you sell--in this case, extremely expensive credit--makes your customers worse off.

Felix Salmon protests that Social Security reform is not a bond default:

RGE - Is social security reform a bond default?: Dean Baker says so, prompting Brad DeLong and PGL to applaud loudly from the sidelines:

This is very important to understand when someone like Federal Reserve Board Chairman Ben Bernanke proposes cuts to Social Security. Workers have already paid for these benefits. The Social Security tax is very regressive. Its regressivity can be justified by the progressive payback structure of the program. However, if the benefits are cut, at a point when the program can still easily afford the benefits (e.g. 10-20 years), then the government has effectively stolen from the people who paid Social Security taxes. There are many people who want to do this – effectively default on the government bonds held by the Social Security trust fund....

Let's agree, for the sake of argument at least, that the social security trust fund exists, chock-full of government bonds. Like any trust fund, its trustees have control over what it pays out and when. If the trust fund reduces the amount it pays out, or only pays out later than currently mandated, that's a change in the trust fund. It is not a bond default. Insofar as the bonds in the trust fund exist, they will continue to receive their coupon and principal payments. It's what the trust fund does with those payments that's being debated.

I feel strongly about this one becuase I've spent a large part of my career following actual sovereign bond defaults, and they're not pretty things. Social Security reform is a serious subject, and it should be taken seriously. Spinning any change in benefits as tanatamount to default by the world's reference risk-free creditor escalates the rhetoric to unhelpful levels.... For me, the only question about whether something is a bond default or not is the question as to whether the bondholder gets paid or not. In this case, the bondholder is the social security trust fund. What the trust fund does with the money is entirely up to it.

It depends on what kind of Social Security reform we are talking about. There's one reform in which benefits are cut and taxes are raised but the equality:

(Current Value of Trust Fund) + (Present Value of Future Social Security Taxes) = (Present Value of Future Social Security Benefits)

is preserved. That's not a default.

There's another reform in which the principal purpose is to open up a gap between the left hand side and the right hand side and make:

(Current Value of Trust Fund) + (Present Value of Future Social Security Taxes) > (Present Value of Future Social Security Benefits)

That is tantamount to default.

Most proposals for Social Security reform that start out with statements like "The Social Security Trust Fund doesn't really exist" are proposals of the second kind.

Friday, January 19, 2007

White House Retreats Under Pressure - New York Times: January 18, 2007 News Analysis White House Retreats Under Pressure By SCOTT SHANE WASHINGTON, Jan. 17 — The Bush administration’s abrupt abandonment on Wednesday of its program to eavesdrop inside the United States without court approval is the latest in a series of concessions to Congress, the courts and public opinion that have dismantled major elements of its strategy to counter the terrorist threat. In the aftermath of the 2001 attacks, President Bush asserted sweeping powers to conduct the hunt for operatives of Al Qaeda, the detention of suspects and their interrogation to uncover the next plot. But facing no new attack to justify emergency measures, as well as a series of losses in the courts and finally the Democratic sweep of the November election, Mr. Bush has had to retreat across the board. “I think there’s no question that both politically and legally, the president has been chastened,” said Douglas W. Kmiec, professor of constitutional law at Pepperdine University and generally a supporter of the administration’s interpretation of executive power. Harold Hongju Koh, the dean of Yale Law School and a critic of the administration’s legal theories, said the president’s strategy might have provoked so strong a judicial and Congressional rebuff that it would ultimately accomplish the opposite of his goal. “I think historians will see it as an exorbitant and extreme theory of executive power that ended up weakening the presidency,” Mr. Koh said. That would be an extraordinary outcome, and one that is far from assured. In some areas, the administration has preserved its freedom to act, notably in persuading Congress last fall to deny prisoners held in Guantánamo Bay, Cuba, the right to challenge their detention in American courts. The full details of the new approach to the domestic eavesdropping program have not been publicly disclosed. Mr. Bush’s legal strategy has been directed not only by the practical need to prevent attacks but also by the belief, expressed most fervently by Vice President Dick Cheney, that presidential powers, and the war-making power in particular, were excessively curbed in reaction to the Vietnam War and the Watergate scandal. Among the laws passed in the post-Vietnam, post-Watergate era was the Foreign Intelligence Surveillance Act of 1978, a hard-fought compromise between the security agencies and civil libertarians. The National Security Agency and the F.B.I. could keep eavesdropping on spy and terror suspects in the United States, but only by justifying their actions to a federal judge in secret hearings before the Foreign Intelligence Surveillance Court. For more than two decades, that compromise served, and government eavesdropping on American soil took place only under court order. But after the Sept. 11 attacks, the White House decided that the court approval process was too slow and cumbersome to match the terrorist threat and that the president had the power to bypass the FISA act and order surveillance on his own authority as commander in chief. In December 2005, a few days after the program of eavesdropping without warrants was disclosed by The New York Times, Mr. Cheney linked it explicitly to the broader question of executive power. “It was true during the cold war, as well as I think what is true now, the president of the United States needs to have his constitutional powers unimpaired, if you will, in terms of the conduct of national security policy,” Mr. Cheney told reporters. “So when you’re asking about my view of the presidency, yes, I believe in a strong, robust executive authority.” The same philosophy guided administration actions in other areas. Hundreds of men were labeled unlawful enemy combatants and imprisoned at Guantánamo Bay, a location chosen in the hope that it would be beyond the reach of American courts. Dozens of terrorist suspects were seized by the Central Intelligence Agency and held in secret overseas locations. Some of those C.I.A. prisoners were interrogated using techniques far harsher than anything approved in earlier wars, including waterboarding, a simulated drowning that many human rights advocates believe crossed the line into torture. Slowly but surely, each of those programs has been eroded. In some cases, the press has uncovered them, creating an outcry from civil libertarians and some Democrats in Congress and often revealing a rift inside the administration. In others, the courts have weighed in, upholding some of the administration’s moves but setting firm limits to others. In the Hamdi case in 2004, Justice Sandra Day O’Connor wrote for the Supreme Court’s majority, “We have long since made clear that a state of war is not a blank check for the president when it comes to the rights of the nation’s citizens.” Last year, in Hamdan v. Rumsfeld, the court rejected the rules for military commissions to try unlawful combatants. Mr. Bush subsequently ordered the C.I.A. to move its 14 so-called high-value Qaeda suspects to Guantánamo to await legal proceedings. Though a new list of approved interrogation techniques has not been finalized, officials say it will not include waterboarding. The N.S.A. program, too, has faced tough scrutiny. A federal judge in Detroit ruled the program unconstitutional, a finding now on appeal. Under pressure from some Republicans as well as Democrats in Congress, the administration first agreed to brief the full Senate and House intelligence committees on the closely guarded program and then accepted the idea of legislation to bring the program under the law. The several proposals pending in Congress to rein in the N.S.A.’s eavesdropping may now become moot. But even if Mr. Bush has again backed away in the face of legal and political trouble, he has by no means given up on the national security agenda that he clearly sees as his legacy, for better or worse. Despite strong opposition from Congress and the public, he has decided to send more American troops into combat in Iraq. Mr. Bush remains commander in chief, whose constitutional powers remain formidable. Democrats may have been empowered by the election and by the administration’s recent setbacks, but while voicing loud protests over Mr. Bush’s new plan for Iraq, they are moving cautiously, with most willing at least for now to embrace only symbolic resistance. Copyright 2007 The New York Times Company Privacy Policy Search Corrections RSS First Look Help Contact Us Work for Us Site Map

Abiola Lapite finds an interesting hand-axe:

Foreign Dispatches: Analyzing Human Expansion: the genetic evidence tells a story... something happened 50-80,000 years ago to set the very small collection of individuals who were our shared ancestors on a course of rapid population expansion, shortly after the onset of which some of them started to pour out into Eurasia and beyond. Whatever that change was, the data says clearly that it cannot have been merely cultural, while the archaeological evidence also makes clear that it wasn't something one could read merely from looking at brow ridges, molars and so forth. My bet is that it was a cognitive change....

PS: An anthropologist by the name John Hawks has interesting things to say about the uniformity of Acheulean stone technology across Africa, Europe and Asia over more than 1 million years.

The maintenance of a single cultural tradition across much of three continents over a million years by exclusively social transmission seems incredible. Some have suggested that the handaxe is hardwired into the human genome, a proposition that seems even less credible (at least, to me). Absent these means of transmission, we are left with the proposition that the handaxe did not fade from the earth because of its functional utility -- either it was the tool that did the job the best, or it was the best tool that humans were capable of making that did the job adequately.

Now, the question you have to ask yourself is just how "human" creatures incapable of bettering the simple stone handaxe over a million years could possibly be; they may have looked like us, but it's clear they didn't think like us, and the timespans under consideration rule out "culture" as the limitation here.

Indeed, as Hawks suggests, at this point it isn't even clear that such a thing as "culture" (and its attendant variation across time and space) existed in a meaningful sense until about 80,000 years ago.

From the archives: David Brooks Gets Burned by Trusting Charles Murray: Archive Entry From Brad DeLong's Webjournal: David Brooks gets burned by trusting the American Enterprise Institute's Charles Murray: >The Atlantic | September 2003 | People Like Us | Brooks: My favorite illustration of this latter pattern comes from the first, noncontroversial chapter of The Bell Curve. Think of your twelve closest friends, Richard J. Herrnstein and Charles Murray write. If you had chosen them randomly from the American population, the odds that half of your twelve closest friends would be college graduates would be six in a thousand. The odds that half of the twelve would have advanced degrees would be less than one in a million... Ummm... No. Definitely not. Back when The Bell Curve was published, according to the _Statistical Abstract_, 22.2% of Americans over 25 had bachelor's degrees (an additional 7% had associate's degrees) and 7.5% of Americans over 25 had advanced degrees. Draw 12 people at random from this set, and if my hasty back-of-the-envelope calculation is correct* the odds that half of them will have college degrees is 2.5% (7.2% if we are counting associate's degrees)--not "six in a thousand." The odds that half of 12 people drawn at random from this set will have advanced degrees is 0.1%--not "less than one in a million." I can't for the life of me figure out what calculations Murray was trying to make that would produce his numbers. But whatever calculations he made, he is off by a factor of 4 (or 12, if we are counting associate's degrees) for the college-educated and off by a factor of 100 for those with advanced degrees. "Does being off by a factor of a hundred (or four) really matter?" you ask. "2.5% or 0.6%, 0.1% or 0.001%, the odds are still low--and the point that American society is not well-mixed is still true. " But Murray's (and Brooks's) point is not that American society is not well mixed. Their point is that American society is totally stratified--and that is surely false. And there is another point. Brooks's reference to the "first, noncontroversial chapter of The Bell Curve" is hard to read as anything other than a partial attempt to try to rehabilitate the reputation that Charles Murray shattered by writing The Bell Curve. It is worth noting that nothing Charles Murray writes can be trusted without being independently verified, and that even the first chapter of The Bell Curve is "controversial"--that is, flat-out wrong. *Suppose we draw twelve people at random. The chance that all of the first six we draw will have college degrees is 0.222^6. The chance that all of the last six we draw will not have college degrees is 0.778^6. The chance that both of these things will happen together is the product of those two numbers--0.0000265. But we don't care about the order: we would be perfectly happy if numbers 2, 4, 7,8,9, and 12 had college degrees. So we need to multiply 0.0000265 by the number of possible ways in which six college and six non-college graduates can be ordered. There are (12!)/((6!)(6!)) such ways--924 such ways. Multiplying 0.0000265 by 924 gives us 0.025--our 2.5% number.

Dave Munger of Cognitive Daily is looking for help to educate Charles Murray:

Cognitive Daily: Help create a reading list for Charles Murray: Charles Murray (of The Bell Curve fame) has written a series of articles for the Wall Street Journal on intelligence.... One frustrating aspect of the articles is that Murray doesn't cite his sources....

Is Murray really suggesting that we shouldn't bother to teach children of average ability how to read and write effectively? Murray later claims that only small, "temporary" increases in IQ are possible, and that poor performance of many schools is due primarily to low IQ in their student population....

Only the gifted -- those with IQs above 120 -- are worthy or capable of being "good," Murray suggests. Murray offers little evidence to support these notions, other than to point readers back to his 1994 book. What I'm wondering is if Cognitive Daily readers might be interested in generating a list of resources to help open Murray's mind a bit. He could start with this one.

His first suggestion:

Duckworth, A.L., & Seligman, M.E.P. (2005). Self-discipline outdoes IQ in predicting academic performance of adolescents. Psychological Science, 16(12), 939-944.

The only thing you need to know about Murray's 1994 Bell Curve book is that he and his coauthor Herrnstein suppressed all education variables from the right-hand-side of their regressions because the results when education variables were included weren't what Murray and Herrnstein wanted them to be. With education suppressed as a factor determining accomplishment, it's hard to see how the 1994 book can inform anybody about the benefits of education vs. inherited genetically-influenced smarts.

Over at Crooked Timber, John Quiggin notes Nick Stern and company's responses to critics: Stern has responded to critics of his review in a recently published postscript. There’s also a Technical Annex with a sensitivity analysis, something that both critics and those (like myself) with a generally favorable view should welcome.

Stern Review: Postscript:

Technical Annex to Postscript:

And John watches ExxonMobil change its position on global warming:

For the last few years, Exxon Mobil has been the biggest single source of support for global warming denialism, and has also exercised a lot of influence on the Bush Administration in its do-nothing stance. For a long while, Exxon was able to act through front groups like the Global Climate Coalition, but the corporation has been increasingly isolated and its activities have been exposed to public scrutiny, most notably with the open letter from the Royal Society last year.

Now Exxon has changed its position, recognising the inevitability of some sort of controls on CO2 emissions, and lobbying for a broad approach that will be relatively favourable to businesses like Exxon, rather than one tightly focused on the energy industry. At this point, an association with shills for denialism like the Competitive Enterprise Institute is counterproductive as well as being embarrassing, so they’ve been cut adrift (along with half a dozen others not yet named).

And commenters chime in:

From what I understand, there’s been an undercurrent within XOM for a while which basically said “those a------- are taking our money to tell us lies we want to hear and making us look like laughingstocks.” It was not a winning position.

New Chairman, new era. Tillerson is not Raymond, but can’t call his former boss an idiot and big ships change course slowly. They’re changing course without changing course. The ‘now the Dems are in control” line allows everyone to change without admitting anyone was wrong before.

Not that Tillerson is joining the Sierra Club. He doesn’t want the controversy or the bad media attention, or his competitors to turf XOM out of the solution space. It’s pragmatic, which is an improvement.

Posted by Exxon Exec's kid · January 14th, 2007 at 1:34 pm


For some time now, Exxon’s robust denialism has divided it from the rest of the oil industry. I recall a Wall Street Journal editorial (the gold standard, if that’s the phrase, for this kind of thing) praising Exxon for sticking to climate-change denial and deriding its competitors for bedding down with the enemy.

Interestingly, the WSJ’s news pages seem to have known this was coming from at least last September. Will the WSJ’s editorialists now heap scorn on Exxon for cooperating with environmental groups? Doesn’t there come a time when you notice that there’s no one else left in the foxhole?

Posted by jre · January 14th, 2007 at 2:21 pm....

Gee, the trolls who pop up on all the global warming threads around here are really going to be confused now. I almost feel sorry for them…

I wonder if the Bush Administration’s rumored soon-to-come about-face is the result of Cheney getting new marching orders from Exxon Mobil.

Posted by Steve LaBonne · January 14th, 2007 at 4:50 pm....

In my experience, even the least green companies harbor plenty of engineers and execs who, even if they don’t buy into environmentalism as an ideology, know which way the wind is blowing on issues such as global warming. For example, you often read that the big auto companies were merely making a PR gesture when they announced programs to develop hybrids or electrics. That may have been true at the higher levels of the companies, but the people who staffed the alternate car divisions were quite serious about producing real products on a large scale. I’ve felt for some time that pro-environmental groups should make a special effort to target the realistic people inside the corporations.

Posted by Jim Harrison · January 15th, 2007 at 1:53 am...

Thursday, January 18, 2007

"Listen! Don't mention the war! I mentioned it once but I think I got away with it alright..."

Attytood: Don't mention the war (or bash Bush): Look, we realize that the White House Correspondents Association dinner is a "fun" event.... But sometimes life and art imitate each other just a little too closely.... [W]e saw earlier this week that the WHCA had chosen Rich Little -- who we used to watch imitate Richard Nixon and Bob Hope on Johnny Carson in the early 1970s... (huge h/t to occasional reader Phoenix Woman).... Little now says he has an understanding not to bash Bush or mention the war:

Little said organizers of the event made it clear they don't want a repeat of last year's controversial appearance by Stephen Colbert, whose searing satire of President Bush and the White House press corps fell flat and apparently touched too many nerves.

"They got a lot of letters," Little said Tuesday. "I won't even mention the word 'Iraq.'"

Little, who hasn't been to the White House since he was a favorite of the Reagan administration, said he'll stick with his usual schtick -- the impersonations of the past six presidents.

"They don't want anyone knocking the president. He's really over the coals right now, and he's worried about his legacy," added Little, a longtime Las Vegas resident.


*"So. It's all forgotten now and let's hear no more about it. So that's two egg mayonnaise, a prawn Goebbels, a Hermann Goering, and four Colditz sandwiches. No, wait a minute, I got a bit confused here. Sorry. I got a bit confused because everybody here keeps mentioning the war. So could you... What's the matter?"

"It's alright."

"Is there something wrong?"

"Will you stop talking about the war!"

"But you started it!"

"We did not start it!"

"Yes you did! You invaded Poland!"*


He preaches the lesson:

Beat the Press: Since the "entitlement" cutters seem to be on the warpath again, it might be time for another sermon on the Social Security trust fund. This one really should not be hard, but I am afraid that that there are many powerful people with a vested interest in creating confusion, and they have succeeded.

In 1983, Congress (following the recommendation of the Greenspan commission) deliberately raised the Social Security tax far above the level needed to pay current Social Security benefits. This led to a large surplus. Under the law, this surplus must be used to buy U.S. government bonds. Also, under the law, the bonds held by Social Security are liabilities of the federal government, just like any other bonds. When the program needs the money from the bonds to pay benefits, it can rely on the interest and eventually the principle from these bonds, just like any private pension or individual.

Note, that there was never any rule that any Social Security only gets government bonds if the government runs a surplus. In other words, from the standpoint of Social Security, it matters not an iota that the government has mostly run deficits for the last quarter century. This may have been bad policy, but it doesn'

t affect the size of the trust fund.

The most recent projections from the non-partisan Congressional Budget Office show that Social Security will have enough money between projected taxes and the bonds in the trust fund to pay all benefits through the year 2046, with no changes whatsoever. This is very important to understand when someone like Federal Reserve Board Chairman Ben Bernanke proposes cuts to Social Security. Workers have already paid for these benefits. The Social Security tax is very regressive. Its regressivity can be justified by the progressive payback structure of the program. However, if the benefits are cut, at appoint when the program can still easily afford the benefits (e.g. 10-20 years), then the government has effectively stolen from the people who paid Social Security taxes.

There are many people who want to do this -- effectively default on the government held by the Social Security trust fund. If this default is now on the national agenda, then it certainly seems reasonable for the workers who are losing their benefits to raise the prospect of defaulting on government bonds more generally. After all, what can possibly be the rationale of only defaulting on the government bonds held by workers through the Social Security trust fund, but not defaulting on the government bonds held by the wealthy people who think this is such a good idea?

We have a preliminary list of views on some of Classic Star Trek: which parts are canonical and which parts are obvious inferior forgeries:

Genuine and Canonical:

Star Trek II: The Wrath of Kahn
Star Trek IV: The Voyage Home
Star Trek VI: The Undiscovered Country

Shore Leave
Mirror, Mirror
The Enterprise Incident
The Devil in the Dark
Balance of Terror
The Trouble with Tribbles
The Changeling
A Piece of the Action
Charlie X
A Taste of Armageddon
The Menagerie
Space Seed
The City on the Edge of Forever
Amok Time
The Omega Glory

Possibly Canonical, but Subject to Dispute:

The Gamesters of Triskelion
Star Trek: The Animated Series, various episodes

Definitely Heretic:

Spock's Brain (The Rex Momus heresy)
Star Trek I: The Motion Picture (The Bruce Moomaw and Jacob Levy heresy)
Star Trek III: The Search for Spock (the Stoffel and Bruce Moomaw heresy)

Textbooks say that the gold standard had internal mechanisms that worked automatically to maintain both price and balance-of-payments stability. On what grounds do Arthur Bloomfield and Hugh Rockoff challenge this textbook view? Are their points convincing?

Handout: Trade and the Division of Labor

J. Bradford DeLong
U.C. Berkeley
January 16, 2006

  • Examples of the division of labor
    • Within Berkeley
    • Beyond Berkeley but within California
    • Beyond California but within the United States
    • Beyond the United States
  • Importance of the division of labor
    • Allowing for the application of skill-intensive production processes
    • Allowing for the application of capital-intensive production processes
    • Allowing for the application of technology-intensive production processes
    • Providing incentives:
      • For investment in skills
      • For investment in capital--saving
      • For investment in technology--research and development
  • How important is the division of labor beyond the United States?
    • Intra-industry trade: narrow specialization
    • Intra-industry trade: competition
      • As spur to efficiency
      • As reducer of profit margins
    • Trade based on factors of production
      • Resources as a source of trade
      • Wealth as a source of trade
      • Poverty as a source of trade
    • Comparative advantage

Some scale variables:

  • U.S. monthly GDP: $1 trillion
    • Monthly goods and services exports: $130 billion = 13%
    • Monthly goods and services imports: $185 billion = 18.5%
    • Balancing item: net capital flow: $55 billion = 5.5%
      • Storing up purchasing power for the future
      • Private political risk insurance
      • Public development aid
      • Public political risk insurance
  • U.S. GDP per worker: $84,000 per year
    • Exports of $10,900 per year
    • Imports of $15,500 per year

Some scale variables:

  • U.S. monthly GDP: $1 trillion
    • Monthly goods and services exports: $130 billion = 13%
    • Monthly goods and services imports: $185 billion = 18.5%
    • Balancing item: net capital flow: $55 billion = 5.5%
      • Storing up purchasing power for the future
      • Private political risk insurance
      • Public development aid
      • Public political risk insurance
  • U.S. GDP per worker: $84,000 per year
    • Exports of $10,900 per year
    • Imports of $15,500 per year

Some scale variables:

  • U.S. monthly GDP: $1 trillion
    • Monthly goods and services exports: $130 billion = 13%
    • Monthly goods and services imports: $185 billion = 18.5%
    • Balancing item: net capital flow: $55 billion = 5.5%
      • Storing up purchasing power for the future
      • Private political risk insurance
      • Public development aid
      • Public political risk insurance
  • U.S. GDP per worker: $84,000 per year
    • Exports of $10,900 per year
    • Imports of $15,500 per year

Division of Labor:

From Adam Smith (1776), An Inquiry into the Nature and Causes of the Wealth of Nations:

Observe the accommodation of the most common artificer or day-labourer in a civilized and thriving country, and you will perceive that the number of people... employed in procuring him this accommodation, exceeds all computation. The woollen coat... is the produce of the joint labour of... [t]he shepherd, the sorter of the wool, the wool-comber or carder, the dyer, the scribbler, the spinner, the weaver, the fuller, the dresser, with many others....

How many merchants and carriers, besides, must have been employed in transporting the materials from some of those workmen to others who often live in a very distant part of the country! how much commerce and navigation in particular, how many ship-builders, sailors, sail-makers, rope-makers, must have been employed in order to bring together the different drugs made use of by the dyer, which often come from the remotest corners of the world! What a variety of labour too is necessary in order to produce the tools of the meanest of those workmen! To say nothing of such complicated machines as the ship of the sailor, the mill of the fuller, or even the loom of the weaver.... The miner, the builder of the furnace for smelting the ore, the feller of the timber, the burner of the charcoal to be made use of in the smelting-house, the brick-maker, the brick-layer, the workmen who attend the furnace, the mill-wright, the forger, the smith, must all of them join their different arts in order to produce them....

This division of labour, from which so many advantages are derived, is not originally the effect of any human wisdom, which foresees and intends that general opulence to which it gives occasion. It is the necessary, though very slow and gradual, consequence of a certain propensity in human nature... to truck, barter, and exchange one thing for another.

Whether this propensity be one of those original principles in human nature... it belongs not to our present subject to enquire. It is common to all men, and to be found in no other race of animals.... Nobody ever saw a dog make a fair and deliberate exchange of one bone for another with another dog....

When an animal wants to obtain something either of a man or of another animal, it has no other means of persuasion but to gain the favour of those whose service it requires. A puppy fawns upon its dam, and a spaniel endeavours by a thousand attractions to engage the attention of its master who is at dinner, when it wants to be fed by him. Man sometimes uses the same arts with his brethren, and when he has no other means of engaging them to act according to his inclinations, endeavours by every servile and fawning attention to obtain their good will.

He has not time, however, to do this upon every occasion. In civilized society he stands at all times in need of the cooperation and assistance of great multitudes, while his whole life is scarce sufficient to gain the friendship of a few persons.... [M]an has almost constant occasion for the help of his brethren, and it is in vain for him to expect it from their benevolence only. He will be more likely to prevail if he can interest their self-love... it is in this manner that we obtain from one another the far greater part of those good offices which we stand in need of. It is not from the benevolence of the butcher, the brewer, or the baker, that we expect our dinner, but from their regard to their own interest. We address ourselves, not to their humanity but to their self-love, and never talk to them of our own necessities but of their advantages...

Extent of the Market:

From Adam Smith (1776), An Inquiry into the Nature and Causes of the Wealth of Nations:

As it is the power of exchanging that gives occasion to the division of labour, so the extent of this division must always be limited by... the extent of the market. When the market is very small, no person can have any encouragement to dedicate himself entirely to one employment, for want of the power to exchange all that surplus part of the produce... for such parts of the produce of other men's labour as he has occasion for.

There are some sorts of industry... which can be carried on no where but in a great town.... In the lone houses and very small villages which are scattered about in so desert a country as the Highlands of Scotland, every farmer must be butcher, baker and brewer for his own family. In such situations we can scarce expect to find even a smith, a carpenter, or a mason, within less than twenty miles of another of the same trade. The scattered families that live at eight or ten miles distance from the nearest of them, must learn to perform themselves a great number of little pieces of work, for which, in more populous countries, they would call in the assistanc.... A country carpenter... is not only a carpenter, but a joiner, a cabinet maker, and even a carver in wood, as well as a wheelwright, a ploughwright, a cart and waggon maker.... It is impossible there should be such a trade as even that of a nailer in the remote and inland parts of the Highlands of Scotland....

As by means of water-carriage a more extensive market is opened to every sort of industry than what land-carriage alone can afford it, so it is upon the sea-coast, and along the banks of navigable rivers, that industry of every kind naturally begins to subdivide and improve itself...

Wednesday, January 17, 2007

Matthew Yglesias writes:

Matthew Yglesias / proudly eponymous since 2002: Marxism: I can't say that I really understand the man's economic thought...

That's OK. I can't say I understand it either--and I've tried too hard, or so many say. As I told my graduate students this year after I made them read the Manifesto of the Communist Party:

There are really five ways to understand Karl Marx's claim that economic laws make a Communist revolution both necessary and inevitable:

  • The Technology Marx: Capital is not a complement to but a substitute for labor, and so technological progress and capital accumulation that raise average labor productivity also lower the working-class wage. Hence the market system cannot and will be seen to be unable to deliver the good society we all deserve, and it will be overthrown...
  • **The Extent-of-the-Market Marx: Businessmen continually extend the domain of captalism, and competition from poor workers in newly-incorporated peripheral regions puts a lid on the wages of labor. Hence inequality grows in the core, and triggers revolution...
  • The Unveiling-of-Reality Marx: Previous systems of hierarchy and domination maintained control by hypnotizing the poor into believing that the rich in some sense "deserved" their high seats in the temple of civilization. Capitalism unveils all--replaces masked exploitation by naked exploitation--and without its ideological legitimation, unequal class society cannot survive...
  • The Ruling-Class-Trapped-by-Its-Ideology Marx: Although the ruling class could appease the working class by sharing the fruits of economic growth, they will not. They are trapped by their own ideological legitimation--they really do believe that it is in some sense "unjust" for a factor of production to earn more than its marginal product. Hence social democracy will inevitably collapse before an ideologically-based right-wing assault, income inequality will rise, and the system will be overthrown...
  • And the Solidarity Marx: Factory work--lots of people living in cities living alongside each other working alongside each other develop a sense of their common interest and of class solidarity, hence they will be able to organize, and revolt...

Which is the real Marx? Ah, grasshopper, not until you have learned not to ask that question will you be able to snatch the pebble from my hand...

Matthew goes on:

[B]ut he had himself some damn good aphorisms.... Marx's brilliant original eleventh thesis on Feuerbach "The philosophers have only interpreted the world, in various ways; the point is to change it."

No. The point is to change it in a positive direction. The American Enterprise Institute has "changed the world," and everybody based in reality recoils in horror. I prefer to ignore Thesis XI and to take my stand with John Maynard Keynes's view of Comrade Trotsky at the Cafe Central:

[Trotsky's] first proposition. The historical process necessitates the change-over to Socialism if civilisation is to be preserved.... Second proposition. It is unthinkable that this change-over can come about by peaceful argument and voluntary surrender. Except in response to force, the possessing classes will surrender nothing.... Third proposition.... The possessing classes will do lip-service to parliamentary methods so long as they are in control of the parliamentary machine, but if they are dislodged, then, Trotsky maintains, it is absurd to suppose that they will prove squeamish about a resort to force on their side.... Fourth proposition. In view of all this, whilst it may be good strategy to aim also at constitutional power, it is silly not to organise on the basis that material force will be the determining factor in the end. In the revolutionary struggle only the greatest determination is of avail to strike the arms out of the hands of reaction to limit the period of civil war, and to lessen the number of its victims....

Granted his assumptions, much of Trotsky's argument is, I think, unanswerable. Nothing can be sillier than to play at revolution.... But... he assumes that the moral and intellectual problems of the transformation of Society have been already solved--that a plan exists, and that nothing remains except to put it into operation.... He is so much occupied with means that he forgets to tell us what it is all for.... Trotsky's book must confirm us in our conviction of the uselessness, the empty-headedness of Force at the present stage of human affairs. Force would settle nothing no more in the Class War than in the Wars of Nations or in the Wars of Religion. An understanding of the historical process, to which Trotsky is so fond of appealing, declares not for, but against, Force at this juncture of things. We lack more than usual a coherent scheme of progress, a tangible ideal. All the political parties alike have their origins in past ideas and not in new ideas and none more conspicuously so than the Marxists. It is not necessary to debate the subtleties of what justifies a man in promoting his gospel by force; for no one has a gospel. The next move is with the head, and fists must wait.

Thanks to Bobby K.'s unofficial Paul Krugman archive, Mark Thoma directs us to Krugman's argument against "Austrian" economics.

In a nutshell, the argument is simple: In the "Austrian" framework, there is a symmetry between demand for consumption goods and investment goods. So how come a boom in demand for investment goods caused by artificially and excessively-low interest rates produces an overall boom? Why doesn't a boom in demand for consumption goods caused by artificially and excessively-high interest rates cause a boom too, or instead?

It's a very good question.

Paul Krugman: [T]he hangover theory is disastrously wrongheaded. Recessions are not necessary consequences of booms. They can and should be fought, not with austerity but with liberality--with policies that encourage people to spend more, not less. Nor is this merely an academic argument: The hangover theory can do real harm.

Liquidationist views played an important role in the spread of the Great Depression--with Austrian theorists such as Friedrich von Hayek and Joseph Schumpeter strenuously arguing, in the very depths of that depression, against any attempt to restore "sham" prosperity by expanding credit and the money supply. And these same views are doing their bit to inhibit recovery in the world's depressed economies at this very moment.

The many variants of the hangover theory all go something like this:

In the beginning, an investment boom gets out of hand. Maybe excessive money creation or reckless bank lending drives it, maybe it is simply a matter of irrational exuberance on the part of entrepreneurs. Whatever the reason, all that investment leads to the creation of too much capacity--of factories that cannot find markets, of office buildings that cannot find tenants. Since construction projects take time to complete, however, the boom can proceed for a while before its unsoundness becomes apparent. Eventually, however, reality strikes--investors go bust and investment spending collapses. The result is a slump whose depth is in proportion to the previous excesses. Moreover, that slump is part of the necessary healing process: The excess capacity gets worked off, prices and wages fall from their excessive boom levels, and only then is the economy ready to recover.

Except for that last bit about the virtues of recessions, this is not a bad story about investment cycles. Anyone who has watched the ups and downs of, say, Boston's real estate market over the past 20 years can tell you that episodes in which overoptimism and overbuilding are followed by a bleary-eyed morning after are very much a part of real life. But let's ask a seemingly silly question: Why should the ups and downs of investment demand lead to ups and downs in the economy as a whole? Don't say that it's obvious--although investment cycles clearly are associated with economywide recessions and recoveries in practice, a theory is supposed to explain observed correlations, not just assume them. And in fact the key to the Keynesian revolution in economic thought--a revolution that made hangover theory in general and Austrian theory in particular as obsolete as epicycles--was John Maynard Keynes' realization that the crucial question was not why investment demand sometimes declines, but why such declines cause the whole economy to slump.

Here's the problem: As a matter of simple arithmetic, total spending in the economy is necessarily equal to total income (every sale is also a purchase, and vice versa). So if people decide to spend less on investment goods, doesn't that mean that they must be deciding to spend more on consumption goods--implying that an investment slump should always be accompanied by a corresponding consumption boom? And if so why should there be a rise in unemployment?

Most modern hangover theorists probably don't even realize this is a problem for their story. Nor did those supposedly deep Austrian theorists answer the riddle. The best that von Hayek or Schumpeter could come up with was the vague suggestion that unemployment was a frictional problem created as the economy transferred workers from a bloated investment goods sector back to the production of consumer goods. (Hence their opposition to any attempt to increase demand: This would leave "part of the work of depression undone," since mass unemployment was part of the process of "adapting the structure of production.")

But in that case, why doesn't the investment boom--which presumably requires a transfer of workers in the opposite direction--also generate mass unemployment? And anyway, this story bears little resemblance to what actually happens in a recession, when every industry--not just the investment sector--normally contracts.

As is so often the case in economics (or for that matter in any intellectual endeavor), the explanation of how recessions can happen, though arrived at only after an epic intellectual journey, turns out to be extremely simple. A recession happens when, for whatever reason, a large part of the private sector tries to increase its cash reserves at the same time. Yet, for all its simplicity, the insight that a slump is about an excess demand for money makes nonsense of the whole hangover theory. For if the problem is that collectively people want to hold more money than there is in circulation, why not simply increase the supply of money?

You may tell me that it's not that simple, that during the previous boom businessmen made bad investments and banks made bad loans. Well, fine. Junk the bad investments and write off the bad loans. Why should this require that perfectly good productive capacity be left idle?

The hangover theory, then, turns out to be intellectually incoherent; nobody has managed to explain why bad investments in the past require the unemployment of good workers in the present. Yet the theory has powerful emotional appeal. Usually that appeal is strongest for conservatives, who can't stand the thought that positive action by governments (let alone--horrors!--printing money) can ever be a good idea.

Some libertarians extol the Austrian theory, not because they have really thought that theory through, but because they feel the need for some prestigious alternative to the perceived statist implications of Keynesianism. And some people probably are attracted to Austrianism because they imagine that it devalues the intellectual pretensions of economics professors. But moderates and liberals are not immune to the theory's seductive charms--especially when it gives them a chance to lecture others on their failings.

My inner Friedrich Hayek is stronger than Paul Krugman's, but it can't think of a good answer to his question right now...

Jason Furman says that he would actually *read* my weblog if I offered an economics-only RSS feed. I hear and obey. Let me try to set one up...

Later: OK. Let's try as the feed of economics-only material, and as the feed for items where I (think I) have made a significant contribution (as opposed to simply lifting an interesting thought by somebody else from elsewhere).

We'll see how this works...

Oooh. This could be dangerous. Classic Star Trek available on the iPod...

What is real genuine Classic Star Trek, anyway?

I believe that there is universal agreement that the genuine Classic Star Trek canon includes the three movies Star Trek II: The Wrath of Khan, Star Trek IV: The Voyage Home, and Star Trek VI: The Undiscovered Country. (The other so-called "Classic" Star Trek movies--I, III, V, and VII--are, by universal agreement, dismissed as spurious interpolations added to the canon at a later date by unknown but untalented writers, producers, and directors.)

But I know of no similar agreement as to which of the one-hour Classic "episodes" are real Classic Star Trek and which are forgeries. Now that the first season is available on iPod format, this is an important question. I know of three first-season episodes that are definitely genuine: "The Devil in the Dark," "The City on the Edge of Forever," and "Balance of Terror." But what are people's views on the others?

Hoisted from comments: Daniel Davies gives the big important argument for investing in private equity:

Grasping Reality with Both Hands: Brad DeLong's Semi-Daily Journal: Where Are the Defenders of Private Equity?: Dear investors,

If you believe that you have the self-discipline to "buy and hold" a portfolio of "mid cap value stocks" for ten years, despite the fact that during that time many of them will deliver heartbreakingly awful newsflow and earnings, then go for it.


The private equity industry.

PS: The evidence of the entire history of investing is that you don't.

Posted by: dsquared | January 17, 2007 at 12:23 AM

Note to self: Abraham Lincoln, in his seventh debate with Stephen Douglas, cites Herrenvolk agitator Preston Brooks: "[W]hen this Constitution was framed, its framers did not look to [slavery] existing until [1858]":

Brooks of South Carolina once declared that when this Constitution was framed, its framers did not look to the institution existing until this day. When he said this, I think he stated a fact that is fully borne out by the history of the times. But he also said they were better and wiser men than the men of these days; yet the men of these days had experience which they had not, and by the invention of the cotton-gin it became a necessity in this country that slavery should be perpetual.

I now say that, willingly or unwillingly, purposely or without purpose, Judge Douglas has been the most prominent instrument in changing the position of the institution of slavery which the fathers of the Government expected to come to an end ere this--and putting it upon Brooks's cotton-gin basis--placing it where he openly confesses he has no desire there shall ever be an end of it.

This has an obvious bearing on Mark Graber's theory that it was illegitimate for the North to use its numbers in 1858 to pass laws affecting slavery because nobody back in 1787 had thought that the North would have superior numbers in 1858. If you believe Abraham Lincoln and Preston Brooks, it would be equally illegitimate according to Graber's theory for Southerners to hold slaves in 1858.

Tuesday, January 16, 2007

There is no god but God, and Muhammed is his messenger blogging. We turn the mike over to Shadi Hamid: John Burns, Say it Isn't So: Look, I'm sure that "veteran Middle East correspondent for the New York Times" John Burns is a great guy. He did, after all, win a 1993 Pulitzer for "his courageous and thorough coverage of the destruction of Sarajevo and the barbarous killings in the war in Bosnia-Herzegovina." Burns has been based in Baghdad for the last couple years. So this juicy tidbit about Burns not knowing the most basic thing about Islam is unbelievable and dispiriting for all those who would like to think that we will ever understand the Muslim world. From the Angry Arab:

An American correspondent in the Middle East sent me this:

Today the Iraqi government held a one time screening of the most recent execution video of Barzan Ibrahim and Awad Hamed al-Bandar, with no cameras allowed. Bandar was very scared and crying. He was saying the shahada. Journalists asked if Bandar said the shahada. New York Times bureau chief and veteran middle east correspondent John Burns asked Basem Ridha, Nouri al Maliki's spokesman, what the shahada was. Basem said that it was the Islamic creed. 'whats that?' asked John Burns. Journalists explained that it was 'There is no God but Allah and Mohammed is his messenger.'

If this is true, then it really is pathetic. John Burns, say it isn't so?

Lori Montgomery and Nell Henderson give yet another reason why in a just world the Washington Post would have to pay people to read it:

Burden Set to Shift On Balanced Budget - When he takes the House rostrum next week for the State of the Union address, President Bush will list among his goals a balanced federal budget, a shift for a president who has presided over record deficits while aggressively cutting taxes.... "The Democrats have assailed deficits under President Bush. The White House is telling Democrats to walk the walk," said Brian M. Riedl, a budget analyst at the conservative Heritage Foundation...

Montgomery and Henderson's first paragraph assumes--falsely--that Bush's shift in rhetoric signals a shift in policy. Montgomery and Henderson's first quote is from one of the very very few people still willing to shill for the Bush administration's fiscal policy. Only afterwards do they concede a smidgeon to reality:

Budget experts and economists from across the political spectrum, including some who worked in the Bush White House, say that Bush is unlikely to offer real concessions toward a balanced budget in the plan he delivers to Congress next month...

Which they then take back:

Still, the administration appears to be stepping away from an economic argument that has worked well for Republicans throughout Bush's presidency: that federal deficits... offer little cause for concern...

The first quote from a critic of the Bush administration is delayed until paragraph 7:

But that view ignores some important facts, U.S. comptroller general David Walker said. The government is living far beyond its means.... Take away the Social Security money, and the deficit would have been $434 billion.... [T]he Social Security surplus will begin to shrink in 2009, as the baby boomers start to retire. It is it estimated that the fund will dry up completely in 2017. At that point, the nation's rosy fiscal picture will darken rapidly...

Only in paragraph 18 do we get the story's proper lead:

"I get the impression they're trying to beef up his reputation for fiscal responsibility, not by doing heavy lifting and actually targeting programs like farm subsidies, but through rhetoric and projections and changes in rules and things that are easy for a president to propose," said Chris Edwards, tax director at the Cato Institute...

Felix Salmon searches for defenders of the private equity industry:

RGE - Where are the defenders of private equity?: Edward Chancellor on private equity... penned something over 2,750 words attacking the private equity industry and all it stands for. Here's the shorter version:

There's a very wide distribution of returns between the best and the worst managers. Unless investors have money in the best-performing buyout funds, they're likely to do far worse than average... Over the past 10 years, investors could have beaten the returns of the best private equity funds simply by applying private equity-style leverage to a portfolio of quoted mid-cap value stocks....

Many private equity deals nowadays involve buying companies from other buyout firms. These so-called "sponsor-to-sponsor deals" offer little obvious scope for operational improvement.... Private equity has come to resemble a game of hot potato in which companies are handed from one private equity firm to another, sometimes as often as three or four times in succession....

Private equity firms could clog up the world's stock markets as they prepare to float upwards of a trillion dollars worth of companies in the years to come. That may not be good news for limited partners, but the private equity firms will still harvest tens of millions of dollars in deal and management fees.... There's the legacy of excessive corporate debt to consider. This could cripple hundreds of companies in years to come...

Chancellor concludes:

In fact, the only major financial players who stand to profit from a buyout bust are the private equity firms themselves. Senior industry figures acknowledge that corporate valuations are currently unattractive. Some admit, in private, to looking forward to a downturn, which might allow them to acquire companies at more affordable prices. Several firms, including industry titans Blackstone, Carlyle, KKR and Texas Pacific have anticipated such an outcome by raising distressed debt funds. Today's private equity boom is shaping up to add yet another chapter to Wall Street's long history of cynicism and arrogance.

I can't say that I really disagree with much of what Chancellor says, although I certainly don't feel as vehement about it as he does. What I'd be really interested in reading, however, would be a cogently-argued defense of private equity, which is something I haven't seen much of, lately.

We still don't have a good read on demand during the Christmas season:

The Bonddad Blog: National Retail Federation Says Holiday Sales Were "Subdued": According to the National Retail Federation (NRF), retail industry sales for December (which exclude automobiles, gas stations, and restaurants) rose 3.9 percent unadjusted over last year and increased 0.4 percent seasonally adjusted from November. November industry sales were revised down from 6.3 percent unadjusted to 5.1 percent unadjusted. December retail sales released today by the U.S. Commerce Department show that total retail sales (which include non-general merchandise categories such as autos, gasoline stations and restaurants) rose 0.9 percent seasonally adjusted from November and increased 3.6 percent unadjusted year-over-year. "Unseasonably warmer weather and the slower housing market had a clear impact on consumer spending," said NRF Chief Economist Rosalind Wells. "NRF expects these subdued gains to continue into the first half of 2007"...

Monday, January 15, 2007

How many lies by Sebastian Mallaby can you spot here?

Sebastian Mallaby - The Other Team's Playbook - [J]ust as Democrats have gained the upper hand on foreign policy, so Republicans have gained the upper hand on health policy.... Last week Arnold Schwarzenegger became the third Republican governor (following Jim Douglas of Vermont and Mitt Romney of Massachusetts) to announce a plan for universal health care; only one Democratic governor (John Baldacci of Maine) has matched that.... [T]he Democrats are advocating a faith-based delusion while Republicans represent the reality-based community....

The Bush administration is already more Wilsonian than Wilson's party, but that's an old piece of cross-dressing.... Bush may... emerge as the lesser of two budgetary evils. Consider: The Democrats have already slammed the door on Social Security reform and are now sorely tempted to propose congressional initiatives that aren't paid for....

The grand prize... will go to the administration if it tackles climate change.... I put the case for a carbon tax or a cap-and-trade system to... the head of the Council on Environmental Quality at the White House.... Connaughton sounded open to them. "In concept I can agree with you," he said. Something must be done to stem demand for climate-warming energy, and although there are several ways of getting there, a carbon tax or cap-and-trade system would be the most "elegant." Whoa! This may be spin, but it's certainly new spin.... [I]t will be interesting to watch the administration's energy policy. Does it want to address climate change or merely the chimera of energy security?...

With columnists like this, I really don't think the Washington Post will be here in a decade. With columnists like this, the Washington Post today should be paying its readers rather than charging them.

We return from Trader Joe's bearing Ezekiel (that's a Hebrew prophet) bread, Maranatha (that's a prayer asking Jesus to come back soon: "Come, Holy Lord), but nothing named after the Islamic or Buddhist traditions--no Imam pistachios or Avelokiteshvara microwaveable rice dishes. This seems vaguely un-Californian...

It's a Holiday Weekend. We're supposed to laze about outside playing frisbee, hiking to astonishing view points, and eating barbequed marinated shrimp at redwood tables beneath the warm California sun. But are we? Nooooo...

IIRC, when the air is 70F, its molecules are moving only 5% faster than when the air is 25F. But when I feel the 25F air on my skin, do my nerves tell me: "Hey, these air molecules are moving 5% slower than usual. How interesting!"? No. My nerves tell me: "What the f--- do you think you're doing, brain? Get us out of here NOW!"

A historical document:

April 16, 1963

My Dear Fellow Clergymen:

While confined here in the Birmingham city jail, I came across your recent statement calling my present activities "unwise and untimely." Seldom do I pause to answer criticism of my work and ideas. If I sought to answer all the criticisms that cross my desk, my secretaries would have little time for anything other than such correspondence in the course of the day, and I would have no time for constructive work. But since I feel that you are men of genuine good will and that your criticisms are sincerely set forth, I want to try to answer your statements in what I hope will be patient and reasonable terms.

I think I should indicate why I am here In Birmingham, since you have been influenced by the view which argues against "outsiders coming in." I have the honor of serving as president of the Southern Christian Leadership Conference, an organization operating in every southern state, with headquarters in Atlanta, Georgia. We have some eighty-five affiliated organizations across the South, and one of them is the Alabama Christian Movement for Human Rights. Frequently we share staff, educational and financial resources with our affiliates. Several months ago the affiliate here in Birmingham asked us to be on call to engage in a nonviolent direct-action program if such were deemed necessary. We readily consented, and when the hour came we lived up to our promise. So I, along with several members of my staff, am here because I was invited here I am here because I have organizational ties here.

But more basically, I am in Birmingham because injustice is here. Just as the prophets of the eighth century B.C. left their villages and carried their "thus saith the Lord" far beyond the boundaries of their home towns, and just as the Apostle Paul left his village of Tarsus and carried the gospel of Jesus Christ to the far corners of the Greco-Roman world, so am I. compelled to carry the gospel of freedom beyond my own home town. Like Paul, I must constantly respond to the Macedonian call for aid.

Moreover, I am cognizant of the interrelatedness of all communities and states. I cannot sit idly by in Atlanta and not be concerned about what happens in Birmingham. Injustice anywhere is a threat to justice everywhere. We are caught in an inescapable network of mutuality, tied in a single garment of destiny. Whatever affects one directly, affects all indirectly. Never again can we afford to live with the narrow, provincial "outside agitator" idea. Anyone who lives inside the United States can never be considered an outsider anywhere within its bounds.

You deplore the demonstrations taking place In Brimingham. But your statement, I am sorry to say, fails to express a similar concern for the conditions that brought about the demonstrations. I am sure that none of you would want to rest content with the superficial kind of social analysis that deals merely with effects and does not grapple with underlying causes. It is unfortunate that demonstrations are taking place in Birmingham, but it is even more unfortunate that the city's white power structure left the Negro community with no alternative.

In any nonviolent campaign there are four basic steps: collection of the facts to determine whether injustices exist; negotiation; self- purification; and direct action. We have gone through an these steps in Birmingham. There can be no gainsaying the fact that racial injustice engulfs this community. Birmingham is probably the most thoroughly segregated city in the United States. Its ugly record of brutality is widely known. Negroes have experienced grossly unjust treatment in the courts. There have been more unsolved bombings of Negro homes and churches in Birmingham than in any other city in the nation. These are the hard, brutal facts of the case. On the basis of these conditions, Negro .leaders sought to negotiate with the city fathers. But the latter consistently refused to engage in good-faith negotiation.

Then, last September, came the opportunity to talk with leaders of Birmingham's economic community. In the course of the negotiations, certain promises were made by the merchants --- for example, to remove the stores humiliating racial signs. On the basis of these promises, the Reverend Fred Shuttles worth and the leaders of the Alabama Christian Movement for Human Rights agreed to a moratorium on all demonstrations. As the weeks and months went by, we realized that we were the victims of a broken promise. A few signs, briefly removed, returned; the others remained.

As in so many past experiences, our hopes bad been blasted, and the shadow of deep disappointment settled upon us. We had no alternative except to prepare for direct action, whereby we would present our very bodies as a means of laying our case before the conscience of the local and the national community. Mindful of the difficulties involved, we decided to undertake a process of self-purification. We began a series of workshops on nonviolence, and we repeatedly asked ourselves : "Are you able to accept blows without retaliating?" "Are you able to endure the ordeal of jail?" We decided to schedule our direct-action program for the Easter season, realizing that except for Christmas, this is the main shopping period of the year. Knowing that a strong economic with with-drawl program would be the by-product of direct action, we felt that this would be the best time to bring pressure to bear on the merchants for the needed change.

Then it occurred to us that Birmingham's mayoralty election was coming up in March, and we speedily decided to postpone action until after election day. When we discovered that the Commissioner of Public Safety, Eugene "Bull" Connor, had piled up enough votes to be in the run-oat we decided again to postpone action until the day after the run-off so that the demonstrations could not be used to cloud the issues. Like many others, we waited to see Mr. Connor defeated, and to this end we endured postponement after postponement. Having aided in this community need, we felt that our direct-action program could be delayed no longer.

You may well ask: "Why direct action? Why sit-ins, marches and so forth? Isn't negotiation a better path?" You are quite right in calling, for negotiation. Indeed, this is the very purpose of direct action. Nonviolent direct action seeks to create such a crisis and foster such a tension that a community which has constantly refused to negotiate is forced to confront the issue. It seeks so to dramatize the issue that it can no longer be ignored. My citing the creation of tension as part of the work of the nonviolent-resister may sound rather shocking. But I must confess that I am not afraid of the word "tension." I have earnestly opposed violent tension, but there is a type of constructive, nonviolent tension which is necessary for growth. Just as Socrates felt that it was necessary to create a tension in the mind so that individuals could rise from the bondage of myths and half-truths to the unfettered realm of creative analysis and objective appraisal, we must we see the need for nonviolent gadflies to create the kind of tension in society that will help men rise from the dark depths of prejudice and racism to the majestic heights of understanding and brotherhood.

The purpose of our direct-action program is to create a situation so crisis-packed that it will inevitably open the door to negotiation. I therefore concur with you in your call for negotiation. Too long has our beloved South land been bogged down in a tragic effort to live in monologue rather than dialogue.

One of the basic points in your statement is that the action that I and my associates have taken .in Birmingham is untimely. Some have asked: "Why didn't you give the new city administration time to act?" The only answer that I can give to this query is that the new Birmingham administration must be prodded about as much as the outgoing one, before it will act. We are sadly mistaken if we feel that the election of Albert Boutwell as mayor. will bring the millennium to Birmingham. While Mr. Boutwell is a much more gentle person than Mr. Connor, they are both segregationists, dedicated to maintenance of the status quo. I have hope that Mr. Boutwell will be reasonable enough to see the futility of massive resistance to desegregation. But he will not see this without pressure from devotees of civil rights. My friends, I must say to you that we have not made a single gain civil rights without determined legal and nonviolent pressure. Lamentably, it is an historical fact that privileged groups seldom give up their privileges voluntarily. Individuals may see the moral light and voluntarily give up their unjust posture; but, as Reinhold Niebuhr has reminded us, groups tend to be more immoral than individuals.

We know through painful experience that freedom is never voluntarily given by the oppressor; it must be demanded by the oppressed. Frankly, I have yet to engage in a direct-action campaign that was "well timed" in the view of those who have not suffered unduly from the disease of segregation. For years now I have heard the word "Wait!" It rings in the ear of every Negro with piercing familiarity. This "Wait" has almost always meant 'Never." We must come to see, with one of our distinguished jurists, that "justice too long delayed is justice denied."

We have waited .for more than 340 years for our constitutional and God- given rights. The nations of Asia and Africa are moving with jetlike speed toward gaining political independence, but we stiff creep at horse-and-buggy pace toward gaining a cup of coffee at a lunch counter. Perhaps it is easy for those who have never felt the stinging dark of segregation to say, "Wait." But when you have seen vicious mobs lynch your mothers and fathers at will and drown your sisters and brothers at whim; when you have seen hate-filled policemen curse, kick and even kill your black brothers and sisters; when you see the vast majority of your twenty million Negro brothers smothering in an airtight cage of poverty in the midst of an affluent society; when you suddenly find your tongue twisted and your speech stammering as you seek to explain to your six- year-old daughter why she can't go to the public amusement park that has just been advertised on television, and see tears welling up in her eyes when she is told that Funtown is closed to colored children, and see ominous clouds of inferiority beginning to form in her little mental sky, and see her beginning to distort her personality by developing an unconscious bitterness toward white people; when you have to concoct an answer for a five-year-old son who is asking: "Daddy, why do white people treat colored people so mean?"; when you take a cross-county drive and find it necessary to sleep night after night in the uncomfortable corners of your automobile because no motel will accept you; when you are humiliated day in and day out by nagging signs reading "white" and "colored"; when your first name becomes "nigger," your middle name becomes "boy" (however old you are) and your last name becomes "John," and your wife and mother are never given the respected title "Mrs."; when you are harried by day and haunted by night by the fact that you are a Negro, living constantly at tiptoe stance, never quite knowing what to expect next, and are plagued with inner fears and outer resentments; when you no forever fighting a degenerating sense of "nobodiness" then you will understand why we find it difficult to wait. There comes a time when the cup of endurance runs over, and men are no longer willing to be plunged into the abyss of despair. I hope, sirs, you can understand our legitimate and unavoidable impatience.

You express a great deal of anxiety over our willingness to break laws. This is certainly a legitimate concern. Since we so diligently urge people to obey the Supreme Court's decision of 1954 outlawing segregation in the public schools, at first glance it may seem rather paradoxical for us consciously to break laws. One may won ask: "How can you advocate breaking some laws and obeying others?" The answer lies in the fact that there fire two types of laws: just and unjust. I would be the Brat to advocate obeying just laws. One has not only a legal but a moral responsibility to obey just laws. Conversely, one has a moral responsibility to disobey unjust laws. I would agree with St. Augustine that "an unjust law is no law at all"

Now, what is the difference between the two? How does one determine whether a law is just or unjust? A just law is a man-made code that squares with the moral law or the law of God. An unjust law is a code that is out of harmony with the moral law. To put it in the terms of St. Thomas Aquinas: An unjust law is a human law that is not rooted in eternal .law and natural law. Any law that uplifts human personality is just. Any law that degrades human personality is unjust. All segregation statutes are unjust because segregation distort the soul and damages the personality. It gives the segregator a false sense of superiority and the segregated a false sense of inferiority. Segregation, to use the terminology of the Jewish philosopher Martin Buber, substitutes an "I- it" relationship for an "I-thou" relationship and ends up relegating persons to the status of things. Hence segregation is not only politically, economically and sociologically unsound, it is morally wrong and awful. Paul Tillich said that sin is separation. Is not segregation an existential expression 'of man's tragic separation, his awful estrangement, his terrible sinfulness? Thus it is that I can urge men to obey the 1954 decision of the Supreme Court, for it is morally right; and I can urge them to disobey segregation ordinances, for they are morally wrong.

Let us consider a more concrete example of just and unjust laws. An unjust law is a code that a numerical or power majority group compels a minority group to obey but does not make binding on itself. This is difference made legal. By the same token, a just law is a code that a majority compels a minority to follow and that it is willing to follow itself. This is sameness made legal.

Let me give another explanation. A law is unjust if it is inflicted on a minority that, as a result of being denied the right to vote, had no part in enacting or devising the law. Who can say that the legislature of Alabama which set up that state's segregation laws was democratically elected? Throughout Alabama all sorts of devious methods are used to prevent Negroes from becoming registered voters, and there are some counties in which, even though Negroes constitute a majority of the population, not a single Negro is registered. Can any law enacted under such circumstances be considered democratically structured?

Sometimes a law is just on its face and unjust in its application. For instance, I have been arrested on a charge of parading without a permit. Now, there is nothing wrong in having an ordinance which requires a permit for a parade. But such an ordinance becomes unjust when it is used to maintain segregation and to deny citizens the First Amendment privilege of peaceful assembly and protest.

I hope you are able to ace the distinction I am trying to point out. In no sense do I advocate evading or defying the law, as would the rabid segregationist. That would lead to anarchy. One who breaks an unjust law must do so openly, lovingly, and with a willingness to accept the penalty. I submit that an individual who breaks a law that conscience tells him is unjust and who willingly accepts the penalty of imprisonment in order to arouse the conscience of the community over its injustice, is in reality expressing the highest respect for law.

Of course, there is nothing new about this kind of civil disobedience. It was evidenced sublimely in the refusal of Shadrach, Meshach and Abednego to obey the laws of Nebuchadnezzar, on the ground that a higher moral law was at stake. It was practiced superbly by the early Christians, who were willing to face hungry lions and the excruciating pain of chopping blocks rather than submit to certain unjust laws of the Roman Empire. To a degree, academic freedom is a reality today because Socrates practiced civil disobedience. In our own nation, the Boston Tea Party represented a massive act of civil disobedience.

We should never forget that everything Adolf Hitler did in Germany was "legal" and everything the Hungarian freedom fighters did in Hungary was "illegal." It was "illegal" to aid and comfort a Jew in Hitler's Germany. Even so, I am sure that, had I lived in Germany at the time, I would have aided and comforted my Jewish brothers. If today I lived in a Communist country where certain principles dear to the Christian faith are suppressed, I would openly advocate disobeying that country's anti religious laws.

I must make two honest confessions to you, my Christian and Jewish brothers. First, I must confess that over the past few years I have been gravely disappointed with the white moderate. I have almost reached the regrettable conclusion that the Negro's great stumbling block in his stride toward freedom is not the White Citizen's Councilor or the Ku Klux Klanner, but the white moderate, who is more devoted to "order" than to justice; who prefers a negative peace which is the absence of tension to a positive peace which is the presence of justice; who constantly says: "I agree with you in the goal you seek, but I cannot agree with your methods of direct action"; who paternalistically believes he can set the timetable for another man's freedom; who lives by a mythical concept of time and who constantly advises the Negro to wait for a "more convenient season." Shallow understanding from people of good will is more frustrating than absolute misunderstanding from people of ill will. Lukewarm acceptance is much more bewildering than outright rejection.

I had hoped that the white moderate would understand that law and order exist for the purpose of establishing justice and that when they fan in this purpose they become the dangerously structured dams that block the flow of social progress. I had hoped that the white moderate would understand that the present tension in the South is a necessary phase of the transition from an obnoxious negative peace, in which the Negro passively accepted his unjust plight, to a substantive and positive peace, in which all men will respect the dignity and worth of human personality. Actually, we who engage in nonviolent direct action are not the creators of tension. We merely bring to the surface the hidden tension that is already alive. We bring it out in the open, where it can be seen and dealt with. Like a boil that can never be cured so long as it is covered up but must be opened with an its ugliness to the natural medicines of air and light, injustice must be exposed, with all the tension its exposure creates, to the light of human conscience and the air of national opinion before it can be cured.

In your statement you assert that our actions, even though peaceful, must be condemned because they precipitate violence. But is this a logical assertion? Isn't this like condemning a robbed man because his possession of money precipitated the evil act of robbery? Isn't this like condemning Socrates because his unswerving commitment to truth and his philosophical inquiries precipitated the act by the misguided populace in which they made him drink hemlock? Isn't this like condemning Jesus because his unique God-consciousness and never-ceasing devotion to God's will precipitated the evil act of crucifixion? We must come to see that, as the federal courts have consistently affirmed, it is wrong to urge an individual to cease his efforts to gain his basic constitutional rights because the quest may precipitate violence. Society must protect the robbed and punish the robber.

I had also hoped that the white moderate would reject the myth concerning time in relation to the struggle for freedom. I have just received a letter from a white brother in Texas. He writes: "An Christians know that the colored people will receive equal rights eventually, but it is possible that you are in too great a religious hurry. It has taken Christianity almost two thousand years to accomplish what it has. The teachings of Christ take time to come to earth." Such an attitude stems from a tragic misconception of time, from the strangely rational notion that there is something in the very flow of time that will inevitably cure all ills. Actually, time itself is neutral; it can be used either destructively or constructively. More and more I feel that the people of ill will have used time much more effectively than have the people of good will. We will have to repent in this generation not merely for the hateful words and actions of the bad people but for the appalling silence of the good people. Human progress never rolls in on wheels of inevitability; it comes through the tireless efforts of men willing to be co-workers with God, and without this 'hard work, time itself becomes an ally of the forces of social stagnation. We must use time creatively, in the knowledge that the time is always ripe to do right. Now is the time to make real the promise of democracy and transform our pending national elegy into a creative psalm of brotherhood. Now is the time to lift our national policy from the quicksand of racial injustice to 6e solid rock of human dignity.

You speak of our activity in Birmingham as extreme. At fist I was rather disappointed that fellow clergymen would see my nonviolent efforts as those of an extremist. I began thinking about the fact that stand in the middle of two opposing forces in the Negro community. One is a force of complacency, made up in part of Negroes who, as a result of long years of oppression, are so drained of self-respect and a sense of "somebodiness" that they have adjusted to segregation; and in part of a few middle class Negroes who, because of a degree of academic and economic security and because in some ways they profit by segregation, have become insensitive to the problems of the masses. The other force is one of bitterness and hatred, and it comes perilously close to advocating violence. It is expressed in the various black nationalist groups that are springing up across the nation, the largest and best- known being Elijah Muhammad's Muslim movement. Nourished by the Negro's frustration over the continued existence of racial discrimination, this movement is made up of people who have lost faith in America, who have absolutely repudiated Christianity, and who have concluded that the white man is an incorrigible "devil."

I have tried to stand between these two forces, saying that we need emulate neither the "do-nothingism" of the complacent nor the hatred and despair of the black nationalist. For there is the more excellent way of love and nonviolent protest. I am grateful to God that, through the influence of the Negro church, the way of nonviolence became an integral part of our struggle.

If this philosophy had not emerged, by now many streets of the South would, I am convinced, be flowing with blood. And I am further convinced that if our white brothers dismiss as "rabble-rousers" and "outside agitators" those of us who employ nonviolent direct action, and if they refuse to support our nonviolent efforts, millions of Negroes will, out of frustration and despair, seek solace and security in black- nationalist ideologies a development that would inevitably lead to a frightening racial nightmare.

Oppressed people cannot remain oppressed forever. The yearning for freedom eventually manifests itself, and that is what has happened to the American Negro. Something within has reminded him of his birthright of freedom, and something without has reminded him that it can be gained. Consciously or. unconsciously, he has been caught up by the Zeitgeist, and with his black brothers of Africa and his brown and yellow brothers of Asia, South America and the Caribbean, the United States Negro is moving with a sense of great urgency toward the promised land of racial justice. If one recognizes this vital urge that has engulfed the Negro community, one should readily understand why public demonstrations are taking place. The Negro has many pent-up resentments and latent frustrations, and he must release them. So let him march; let him make prayer pilgrimages to the city hall; let him go on freedom rides-and try to understand why he must do so. If his repressed emotions are not released in nonviolent ways, they will seek expression through violence; this is not a threat but a fact of history. So I have not said to my people: "Get rid of your discontent." Rather, I have tried to say that this normal and healthy discontent can be channeled into the creative outlet of nonviolent direct action. And now this approach is being termed extremist.

But though I was initially disappointed at being categorized as an extremist, as I continued to think about the matter I gradually gained a measure of satisfaction from the label. Was not Jesus an extremist for love: "Love your enemies, bless them that curse you, do good to them that hate you, and pray for them which despitefully use you, and persecute you." Was not Amos an extremist for justice: "Let justice roll down like waters and righteousness like an ever-flowing stream." Was not Paul an extremist for the Christian gospel: "I bear in my body the marks of the Lord Jesus." Was not Martin Luther an extremist: "Here I stand; I cannot do otherwise, so help me God." And John Bunyan: "I will stay in jail to the end of my days before I make a butchery of my conscience." And Abraham Lincoln: "This nation cannot survive half slave and half free." And Thomas Jefferson: "We hold these truths to be self-evident, that an men are created equal ..." So the question is not whether we will be extremists, but what kind of extremists we viii be. We be extremists for hate or for love? Will we be extremist for the preservation of injustice or for the extension of justice? In that dramatic scene on Calvary's hill three men were crucified. We must never forget that all three were crucified for the same crime---the crime of extremism. Two were extremists for immorality, and thus fell below their environment. The other, Jeans Christ, was an extremist for love, truth and goodness, and thereby rose above his environment. Perhaps the South, the nation and the world are in dire need of creative extremists.

I had hoped that the white moderate would see this need. Perhaps I was too optimistic; perhaps I expected too much. I suppose I should have realized that few members of the oppressor race can understand the deep groans and passionate yearnings of the oppressed race, and still fewer have the vision to see that injustice must be rooted out by strong, persistent and determined action. I am thankful, however, that some of our white brothers in the South have grasped the meaning of this social revolution and committed themselves to it. They are still too few in quantity, but they are big in quality. Some-such as Ralph McGill, Lillian Smith, Harry Golden, James McBride Dabbs, Ann Braden and Sarah Patton Boyle---have written about our struggle in eloquent and prophetic terms. Others have marched with us down nameless streets of the South. They have languished in filthy, roach-infested jails, suffering the abuse and brutality of policemen who view them as "dirty nigger lovers." Unlike so many of their moderate brothers and sisters, they have recognized the urgency of the moment and sensed the need for powerful "action" antidotes to combat the disease of segregation.

Let me take note of my other major disappointment. I have been so greatly disappointed with the white church and its leadership. Of course, there are some notable exceptions. I am not unmindful of the fact that each of you has taken some significant stands on this issue. I commend you, Reverend Stallings, for your Christian stand on this past Sunday, in welcoming Negroes to your worship service on a non segregated basis. I commend the Catholic leaders of this state for integrating Spring Hill College several years ago.

But despite these notable exceptions, I must honestly reiterate that I have been disappointed with the church. I do not say this as one of those negative .critics who can always find. something wrong with the church. I say this as a minister of the gospel, who loves the church; who was nurtured in its bosom; who 'has been sustained by its spiritual blessings and who will remain true to it as long as the cord of Rio shall lengthen.

When I was suddenly catapulted into the leadership of the bus protest in Montgomery, Alabama, a few years ago, I felt we would be supported by the white church felt that the white ministers, priests and rabbis of the South would be among our strongest allies. Instead, some have been outright opponents, refusing to understand the freedom movement and misrepresenting its leader era; an too many others have been more cautious than courageous and have remained silent behind the anesthetizing security of stained-glass windows.

In spite of my shattered dreams, I came to Birmingham with the hope that the white religious leadership of this community would see the justice of our cause and, with deep moral concern, would serve as the channel through which our just grievances could reach the power structure. I had hoped that each of you would understand. But again I have been disappointed.

I have heard numerous southern religious leaders admonish their worshipers to comply with a desegregation decision because it is the law, but I have longed to hear white ministers declare: "Follow this decree because integration is morally right and because the Negro is your brother." In the midst of blatant injustices inflicted upon the Negro, I have watched white churchmen stand on the sideline and mouth pious. irrelevancies and sanctimonious trivialities. In the midst of a mighty struggle to rid our nation of racial and economic injustice, I have heard many ministers say: "Those are social issues, with which the gospel has no real concern." And I have watched many churches commit themselves to a completely other worldly religion which makes a strange, on Biblical distinction between body and soul, between the sacred and the secular.

I have traveled the length and breadth of Alabama, Mississippi and all the other southern states. On sweltering summer days and crisp autumn mornings I have looked at the South's beautiful churches with their lofty spires pointing heavenward. I have beheld the impressive outlines of her massive religious-education buildings. Over and over I have found myself asking: "What kind of people worship here? Who is their God? Where were their voices when the lips of Governor Barnett dripped with words of interposition and nullification? Where were they when Governor Walleye gave a clarion call for defiance and .hatred? Where were their voices of support when bruised and weary Negro men and women decided to rise from the dark dungeons of complacency to the bright hills of creative protest?"

Yes, these questions are still in my mind. In deep disappointment I have wept over the laxity of the church. But be assured that my tears have been tears of love. There can be no deep disappointment where there is not deep love. Yes, I love the church. How could I do otherwise? l am in the rather unique position of being the son, the grandson and the great- grandson of preachers. Yes, I see the church as the body of Christ. But, oh! How we have blemished and scarred that body through social neglect and through fear of being nonconformists.

There was a time when the church was very powerful in the time when the early Christians rejoiced at being deemed worthy to suffer for what they believed. In those days the church was not merely a thermometer that recorded the ideas and principles of popular opinion; it was a thermostat that transformed the mores of society. Whenever the early Christians entered a town, the people in power became disturbed and immediately sought to convict the Christians for being "disturbers of the peace" and "outside agitators"' But the Christians pressed on, in the conviction that they were "a colony of heaven," called to obey God rather than man. Small in number, they were big in commitment. They were too God intoxicated to be "astronomically intimidated." By their effort and example they brought an end to such ancient evils as infanticide. and gladiatorial contests.

Things are different now. So often the contemporary church is a weak, ineffectual voice with an uncertain sound. So often it is an archdefender of the status quo. Par from being disturbed by the presence of the church, the power structure of the average community is consoled by the church's silent and often even vocal sanction of things as they are.

But the judgment of God is upon the church as never before. If today's church does not recapture the sacrificial spirit of the early church, it vi lose its authenticity, forfeit the loyalty of millions, and be dismissed as an irrelevant social club with no meaning for the twentieth century. Every day I meet young people whose disappointment with the church has turned into outright disgust.

Perhaps I have once again been too optimistic. Is organized religion too inextricably bound to the status quo to save our nation and the world? Perhaps I must turn my faith to the inner spiritual church, the church within the church, as the true ekklesia and the hope of the world. But again I am thankful to God that some noble souls from the ranks of organized religion have broken loose from the paralyzing chains of conformity and joined us as active partners in the struggle for freedom, They have left their secure congregations and walked the streets of Albany, Georgia, with us. They have gone down the highways of the South on tortuous rides for freedom. Yes, they have gone to jai with us. Some have been dismissed from their churches, have lost the support of their bishops and fellow ministers. But they have acted in the faith that right defeated is stronger than evil triumphant. Their witness has been the spiritual salt that has preserved the true meaning of the gospel in these troubled times. They have carved a tunnel of hope through the dark mountain of disappointment.

I hope the church as a whole will meet the challenge of this decisive hour. But even if the church does not come to the aid of justice, I have no despair about the future. I have no fear about the outcome of our struggle in Birmingham, even if our motives are at present misunderstood. We will reach the goal of freedom in Birmingham, ham and all over the nation, because the goal of America k freedom. Abused and scorned though we may be, our destiny is tied up with America's destiny. Before the pilgrims landed at Plymouth, we were here. Before the pen of Jefferson etched the majestic words of the Declaration of Independence across the pages of history, we were here. For more than two centuries our forebears labored in this country without wages; they made cotton king; they built the homes of their masters while suffering gross injustice and shameful humiliation-and yet out of a bottomless vitality they continued to thrive and develop. If the inexpressible cruelties of slavery could not stop us, the opposition we now face will surely fail. We will win our freedom because the sacred heritage of our nation and the eternal will of God are embodied in our echoing demands.

Before closing I feel impelled to mention one other point in your statement that has troubled me profoundly. You warmly commended the Birmingham police force for keeping "order" and "preventing violence." I doubt that you would have so warmly commended the police force if you had seen its dogs sinking their teeth into unarmed, nonviolent Negroes. I doubt that you would so quickly commend the policemen if .you were to observe their ugly and inhumane treatment of Negroes here in the city jail; if you were to watch them push and curse old Negro women and young Negro girls; if you were to see them slap and kick old Negro men and young boys; if you were to observe them, as they did on two occasions, refuse to give us food because we wanted to sing our grace together. I cannot join you in your praise of the Birmingham police department.

It is true that the police have exercised a .degree of discipline in handing the demonstrators. In this sense they have conducted themselves rather "nonviolently" in public. But for what purpose? To preserve the evil system of segregation. Over the past few years I have consistently preached that nonviolence demands that the means we use must be as pure as the ends we seek. I have tried to make clear that it is wrong to use immoral means to attain moral ends. But now I must affirm that it is just as wrong, or perhaps even more so, to use moral means to preserve immoral ends. Perhaps Mr. Connor and his policemen have been rather nonviolent in public, as was Chief Pritchett in Albany, Georgia but they have used the moral means of nonviolence to maintain the immoral end of racial injustice. As T. S. Eliot has said: "The last temptation is the greatest treason: To do the right deed for the wrong reason."

I wish you had commended the Negro sit-inners and demonstrators of Birmingham for their sublime courage, their willingness to suffer and their amazing discipline in the midst of great provocation. One day the South will recognize its real heroes. They will be the James Merediths, with the noble sense of purpose that enables them to face Jeering, and hostile mobs, and with the agonizing loneliness that characterizes the life of the pioneer. They will be old, oppressed, battered Negro women, symbolized in a seventy-two-year-old woman in Montgomery, Alabama, who rose up with a sense of dignity and with her people decided not to ride segregated buses, and who responded with ungrammatical profundity to one who inquired about her weariness: "My fleets is tired, but my soul is at rest." They viii be the young high school and college students, the young ministers of the gospel and a host of their elders, courageously and nonviolently sitting in at lunch counters and willingly going to jail for conscience' sake. One day the South will know that when these disinherited children of God sat down at lunch counters, they were in reality standing up for what is best in the American dream and for the most sacred values in our Judaeo-Christian heritage, thereby bringing our nation back to those great wells of democracy which were dug deep by the founding fathers in their formulation of the Constitution and the Declaration of Independence.

Never before have I written so long a letter. I'm afraid it is much too long to take your precious time. I can assure you that it would have been much shorter if I had been writing from a comfortable desk, but what else can one do when he k alone in a narrow jail cell, other than write long letters, think long thoughts and pray long prayers?

If I have said anything in this letter that overstates the truth and indicates an unreasonable impatience, I beg you to forgive me. If I have said anything that understates the truth and indicates my having a patience that allows me to settle for anything less than brotherhood, I beg God to forgive me.

I hope this letter finds you strong in the faith. I also hope that circumstances will soon make it possible for me to meet each of you, not as an integrationist or a civil rights leader but as a fellow clergyman and a Christian brother. Let us. all hope that the dark clouds of racial prejudice will soon pass away and the deep fog of misunderstanding will be lifted from our fear-drenched communities, and in some not too distant tomorrow the radiant stars of love and brotherhood will shine over our great nation with all their scintillating beauty.

Yours for the cause of Peace and Brotherhood,

Martin Luther King, Jr.