Saturday, May 28, 2011

Breaking! Sarah Palin will NOT Run for President.

Lawrence O'Donnell has the story here.

Oh, and by the way, Rolling Thunder doesn't like her hangin' around, either.

Ripping a New One in Education Secretary Arne Duncan

I have not paid much attention to Secretary Duncan, but a recent post over at Big Orange rips him quite severely.  I hadn't realized that Race to the Top was a brainchild of his, but I am in principle opposed to all programs that purport to improve public education by applying carrot/stick methodologies according to performance metrics based on standardized testing.

Anyhow, the above-referenced link, from a high-school Biology teacher in Oklahoma, frames the problem of education reform in stark yet eloquent terms. Go read it.

Wednesday, May 25, 2011

Big Dog on the Dark Side

An news item today quotes former President Bill Clinton -- the Big Dog, as he is fondly called by his old admiring constituents -- warning Democrats, not to turn away from Entitlement Reform, in the wake of last night's special Congressional election (NY 26th District) in which the Democratic challenger won a traditionally Republican seat, by hammering the incumbent with her support for Paul Ryan's plan to end Medicare as we know it.

Unfortunately, Bill was speaking at Fiscal Summit sponsored by the Peterson Foundation, the infamous kleptocratic think tank that stood behind President Obama's nefarious Catfood Commission, which was charged with gutting Social Security.

For myself, I am truly sorry to see the Big Dog lending his weight and prestige to the Peterson enterprise, which is aimed ultimately at ripping off middle class entitlements to engorge the (already overstuffed) plutocracy.

Saturday, May 21, 2011

Food and Karma

I cannot vouch for the provenance or authenticity of this, but the conceit is irresistibly attractive:  That is, I recall reading somewhere, in a discussion of Buddhist doctrine, the statement that the total amount of food in any given world is a direct consequence of the entire sum of accumulated Good Karma, of all sentient creatures inhabiting that world.  This would include all animate beings, from humans down to sea-slugs and gnats (to name but a few.)  Obviously people will argue over who or what is good or evil, and simple dichotomies like Ghandi vs. Stalin won't illuminate much; nonetheless, I believe a certain rough consensus exists that starving people to make money is bad conduct, and therefore bad karma.

It is therefore particularly striking to me when a perceived evil action by some human agency is aimed directly at lowering the availability of food for profit.  Or, in terms less stark, action by some human agency with the perceptible and likely consequence of lowering the availability of food while turning a handsome profit.    The journal Foreign Policy recently devoted a full issue to food, and includes an article blaming Goldman Sachs for the current spike  (or bubble, if you prefer, though the two sound incompatible) in wheat prices globally.  These have added about 25 cents to the price of a loaf of bread in America, but have doubled that price in places like Indonesia, where the average percentage of household income spent on food is far higher than in America.

I am not an expert on financial derivatives, although as a worker in an industry that actually makes and exports things, I have a certain moral horror of (not to mention supercilious disdain for) business enterprises that make money from money, without serving any real purpose in capital formation.  I am assuredly not against capital markets; but to me, derivatives are as parasites on the body of an industrial economy; nonetheless, I will defer that soap-box rant for another day.

So as I understand the substance of the FP article, two factors have been operative.  First, in 1991, GS creates a commodities index product (GSCI), in which different commodities (hogs, soy , wheat, metals etc.) sliced and diced and re-assembled into a composite index.  This didn't lead to much, until de-regulation entered the picture.  From FP:

For just under a decade, the GSCI remained a relatively static investment vehicle, as bankers remained more interested in risk and collateralized debt than in anything that could be literally sowed or reaped. Then, in 1999, the Commodities Futures Trading Commission deregulated futures markets. All of a sudden, bankers could take as large a position in grains as they liked, an opportunity that had, since the Great Depression, only been available to those who actually had something to do with the production of our food.

Goldman's system was designed so that one can only buy; when time comes to roll over a futures contract it can't be sold short in a falling market.  This creates an inevitable upward pressure on commodities prices, including food.  

As other speculative bubbles (Tech, Real Estate) have burst, more and more money has flowed into commodities derivatives, hence we now find ourselves with a global food bubble -- not overly noticeable in the G7 perhaps, but disastrous in poorer countries.

So, am I being to hard on GS? pulling out the moral and rhetorical stops on them, and unleashing the impotent fire and brimstone of an obscure commentators, even whose friends are careful not to ask for the URL when this blog is mentioned conversationally?

Certainly there are countervailing opinions, by those who think that grain prices are responding rationally to the simple mechanics of supply and demand.  On the evidence I disagree.  Goldman has the global economic bit in its teeth, and is running wild.  They are altogether unchastened by their recent escapes from annihilation in 2008; and God help us all if they are not brought under control.

More Apologies for Sporadic Posting

As a business traveller, I do not fit the profile of a 'road warrior;' I have nonetheless spent 5 of the last 10 weeks away from home.  Not to complain, but this plays Hell with my routine, and my willingness and ability to face and focus upon the grim politics which form my usual inspiration for blogging.