Category: Uncategorized

Privatizing the State Department

Never forget that corporations are creations of government:

Back in 2011 I had a meeting with Eric Schmidt, the then Chairman of
Google, who came out to see me with three other people while I was under
house arrest. You might suppose that coming to see me was gesture that
he and the other big boys at Google were secretly on our side: that they
support what we at WikiLeaks are struggling for: justice, government
transparency, and privacy for individuals.

But that would be a false
supposition. Their agenda was much more complex, and as we found out,
was inextricable from that of the US State Department. The full
transcript of our meeting is available online through the WikiLeaks
website. The pretext for their visit was that Schmidt was then researching a new book, a banal tome which has since come out as The New Digital Age.
My less than enthusiastic review of this book was published in the New
York Times in late May of this year. On the back of that book are a
series of pre-publication endorsements: Henry Kissinger, Bill Clinton,
Madeleine Albright, Michael Hayden (former head of the CIA and NSA) and
Tony Blair. Inside the book Henry Kissinger appears once again, this
time given pride of place in the acknowledgements.

Schmidt’s book is not about communicating with the public. He is
worth $6.1 billion and does not need to sell books. Rather, this book is
a mechanism by which Google seeks to project itself into Washington. It
shows Washington that Google can be its partner, its geopolitical
visionary, who will help Washington see further about America’s
interests. And by tying itself to the US state, Google thereby cements
its own security, at the expense of all competitors.

Two months after my meeting with Eric Schmidt, WikiLeaks had a legal
reason to call Hilary Clinton and to document that we were calling her.
It’s interesting that if you call the front desk of the State Department
and ask for Hillary Clinton, you can actually get pretty close, and
we’ve become quite good at this. Anyone who has seen Doctor Strangelove
may remember the fantastic scene when Peter Sellers calls the White
House from a payphone on the army base and is put on hold as his call
gradually moves through the levels. Well WikiLeaks journalist Sarah
Harrison, pretending to be my PA, put through our call to the State
Department, and like Peter Sellers we started moving through the levels,
and eventually we got up to Hillary Clinton’s senior legal advisor, who
said that we would be called back.

Shortly afterwards another one of our people, WikiLeaks’ ambassador
Joseph Farrell, received a call back, not from the State Department, but
from Lisa Shields, the then girlfriend of Eric Schmidt, who does not
formally work for the US State Department. So let’s reprise this
situation: The Chairman of Google’s girlfriend was being used as a back
channel for Hillary Clinton. This is illustrative. It shows that at this
level of US society, as in other corporate states, it is all musical
chairs.

That visit from Google while I was under house arrest was, as it
turns out, an unofficial visit from the State Department. Just consider
the people who accompanied Schmidt on that visit: his girlfriend Lisa
Shields, Vice President for Communications at the CFR; Scott Malcolmson,
former senior State Department advisor; and Jared Cohen,  advisor to
both Hillary Clinton and Condoleezza Rice, a kind of Generation Y
Kissinger figure — a noisy Quiet American as the author Graham Greene
might have put it.

So, whatever happened to Don’t Be Evil?  Or, as I’ve previously thought, perhaps we should have all viewed Google with the same wariness that one views a kindergarten teacher who is constantly gritting his teeth and reminding himself: “Don’t touch the merchandise… don’t touch the merchandise.”

Bound by Zero: the Hall paper

Like Karl Denninger, I found the conclusion of Fed economist Robert Hall’s paper to be fascinating, both for what it did and did not say:

4.4 The deflation nightmare

So far, inflation has fallen only slightly and remains in positive territory. Fears in early 2009 that rapid deflation might break out and cause the economy to collapse as in 1929 to 1933 proved unfounded, luckily. I have advanced the hypothesis that rampant price-cutting has failed to appear because businesses are in equilibrium and perceive that price-cutting has bigger costs than benefits. If the hypothesis is wrong and businesses are finally responding to five years of slack by cutting prices, the generally optimistic tone of this section could be quite mistaken. The bottom could fall out of the economy as it did in the Great Depression.

5 Concluding Remarks

The central danger in the next two years is that the Fed will yield to the intensifying pressure to raise interest rates and contract its portfolio well before the economy is back to normal. The worst step the Fed could take would be to raise the interest rate it pays on reserves. The analysis of this paper focusing on the zero lower bound applies equally to a reserve rate above zero. Every percentage point increase in the reserve rate drives the real interest rate up and contracts the economy by the principles discussed here.

With respect to policies that might lower the probability of a repetition of the multi-trillion dollar disaster of the past five years, it is true that a policy of higher chronic inflation would have given monetary policy more headroom for expansion to counteract the decline in output demand and to prevent it from causing a decline in output. But I see that response as distinctly second-best. Much preferable are policies to maintain a robust financial system that responds smoothly to declines in real-estate prices. Requiring more capital in fi nancial institutions is an important part of good policy, but to determine the amount of capital, there is no substitute in a modern financial system for frequent and rigorous stress-testing.

Derivatives create exposures that are not recorded as leverage, but are fully apparent in stress tests. With a stable, bullet-proof fi nancial system, policies of low inflation are quite safe.

I have explained, repeatedly, why we haven’t seen deflation set in yet.  Credit is still expanding, only at a rate insufficient to provide for either economic growth or private sector jobs. Sans the 114% increase in Federal sector debt and the over the last five years, instead of credit disinflation we would have seen actual deflation.   There are no signs that either the 7% decline in Household debt or 20% decline in Financial sector debt are going to change, so the federal government has no choice but to keep doubling its spending every four years just to hold its ground.

Unsurprisingly, lacking any model to account for credit, Paul Krugman isn’t quite sure exactly what to make of it. But I suspect Hall knows better, which is why he admits that if his hypothesis is wrong, “the generally optimistic tone of this section could be quite mistaken”.

It is mistaken. Other than idiot college students who don’t know any better and whose debt servitude is guaranteed by the government, do you know anyone who is increasing their debt?

This problem of the Zero Bound was long predicted by every economist who warned of the impossibility of “pushing on a string”.  Cutting interest rates can stimulate borrowing, and the subsequent creation of credit, until they cannot be cut anymore.  I, and numerous others, pointed this out, but the Krugmans of the world argued that the Zero Bound was not binding.

But eventually, the long run always arrives.  Everyone wants to know exactly when the economy will hit the ground towards which it is falling, but I can’t say because that depends upon how long the Fed and the Federal government are willing to try to keep trying to flap their arms instead of bracing for impact.

Rating the epic fantasies

Someone came up with this idea in the comments and I thought it would be interesting, especially because I recently started reading two would-be epic fantasies that are, in a word, DEEE-readful.  About which more anon.  Here are the epic series I’m considering for the list, but feel free to add more in if you feel they belong.  To qualify, an epic fantasy has to be epic, it has to be big and fat and set in its own distinct, sprawling fantasy world.  If the books in the series aren’t at least 600 pages apiece, (and 750 is better), they don’t count, although I’m willing to consider exceptions.  For example, Glen Cook’s Black Company, in or out?  I vote in due to the size and scope of the series, though not the individual books themselves. Harry Potter, on the other hand, is definitely out.

The Lord of the Rings, Tolkien
The Wheel of Time, Jordan
The Riftwar Saga, Feist
Chronicles of Thomas Covenant, Donaldson
Shannara, Brooks
The Sword of Truth, Goodkind
Malazan  Book of the Fallen, Erikson
A Song of Ice and Fire, Martin
First Law, Abercrombie
Prince of Nothing, Bakker
The Black Company, Cook
The Kingkiller Chronicle, Rothfuss
The Belgariad, Eddings
The Mallorean, Eddings
Dragonlance, Weis & Hickman
The Deathgate Cycle, Weis and Hickman
The Long Price Quartet, Abraham
The Stormlight Archive, Sanderson
Mistborn, Sanderson
The Red Knight, Cameron
The Demon Cycle, Peter Brett

I was a little surprised to go back and discover that Silverberg’s Majipoor Cycle was a short as it is.  I remember Lord Valentine’s Castle being a huge book, not a mere 479 pages.  Anyhow, feel free to suggest any other epic fantasies that you would argue merit consideration, but note that I’ve already decided that Guy Gavriel Kay’s, Lloyd Alexander’s and Robin Hobb’s books are of insufficient scale to qualify as epic fantasy, whereas John Fultz’s and Mark Lawrence’s books are simply too short to make the cut.  And while one could make a perfectly rational argument for Pratchett’s Discworld in its totality, I don’t think it belongs here for stylistic reasons, if nothing else.

An amazing coincidence

In an amazing and unsettling coincidence, it seems the recent massacre in Syria, which we are supposed to believe was committed by the Assad regime just as it had taken control of the civil war, was anticipated by the need for one more than 18 months in advance. Zerohedge posts a StratFor email from December 2011 via Wikileaks:

I spent most of the afternoon at the Pentagon with the USAF strategic studies group – guys who spend their time trying to understand and explain to the USAF chief the big picture in areas where they’re operating in. It was just myself and four other guys at the Lieutenant Colonel level, including one French and one British representative who are liaising with the US currently out of DC.

They wanted to grill me on the strategic picture on Syria, so after that I got to grill them on the military picture. There is still a very low level of understanding of what is actually at stake in Syria, what’s the strategic interest there, the Turkish role, the Iranian role, etc. After a couple hours of talking, they said without saying that SOF teams (presumably from US, UK, France, Jordan, Turkey) are already on the ground focused on recce [ZH: “recce” means reconnaissance] missions and training opposition forces. One Air Force intel guy (US) said very carefully that there isn’t much of a Free Syrian Army to train right now anyway, but all the operations being done now are being done out of ‘prudence.’ The way it was put to me was, ‘look at this way – the level of information known on Syrian OrBat this month is the best it’s been since 2001.’ They have been told to prepare contingencies and be ready to act within 2-3 months, but they still stress that this is all being done as contingency planning, not as a move toward escalation.

I kept pressing on the question of what these SOF teams would be working toward, and whether this would lead to an eventual air camapign to give a Syrian rebel group cover. They pretty quickly distanced themselves from that idea, saying that the idea ‘hypothetically’ is to commit guerrilla attacks, assassination campaigns, try to break the back of the Alawite forces, elicit collapse from within. There wouldn’t be a need for air cover, and they wouldn’t expect these Syrian rebels to be marching in columns anyway.

They emphasized how the air campaign in Syria makes Libya look like a piece of cake. Syrian air defenses are a lot more robust and are much denser, esp around Damascus and on the borders with Israel, Turkey. THey are most worried about mobile air defenses, particularly the SA-17s that they’ve been getting recently. It’s still a doable mission, it’s just not an easy one.

The main base they would use is Cyprus, hands down. Brits and FRench would fly out of there. They kept stressing how much is stored at Cyprus and how much recce comes out of there. The group was split on whether Turkey would be involved, but said Turkey would be pretty critical to the mission to base stuff out of there. EVen if Turkey had a poltiical problem with Cyprus, they said there is no way the Brits and the FRench wouldn’t use Cyprus as their main air force base. Air Force Intel guy seems  pretty convinced that the Turks won’t participate (he seemed pretty pissed at them.)

There still seems to be a lot of confusion over what a military intervention involving an air campaign would be designed to achieve. It isn’t clear cut for them geographically like in Libya, and you can’t just create an NFZ over Homs, Hama region. This would entail a countrywide SEAD campaign lasting the duration of the war. They dont believe air intervention would happen unless there was enough media attention on a massacre, like the Ghadafi move against Benghazi. They think the US would have a high tolerance for killings as long as it doesn’t reach that very public stage. Theyre also questiioning the skills of the Syrian forces that are operating the country’s air defenses currently and how signfiicant the Iranian presence is there. Air Force Intel guy is most obsessed with the challenge of taking out Syria’s ballistic missile capabilities and chem weapons. With Israel rgiht there and the regime facing an existential crisis, he sees that as a major complication to any military intervention.

I imagine Mr. Putin knew this already when he expressed his doubts concerning the Syrian regime’s responsibility for the attack.  At this point, I wouldn’t blame those who are beginning to wonder if the Boston Massacre was a false flag.  We should have known George W. Bush wasn’t serious about war with Iran despite all the neocons beating the drum for one, given that the media was never full of atrocities committed by the Iranian government.

So, it looks like Syria is happening and my strategic antenna back in November 2011 were not quite as off-base as I’d concluded they were.

Women and military discipline

As bad as this sounds, the reality is even worse:

I once asked a friend who is a retired Army command sergeant major how
they disciplined the women. He replied, “You can’t. If you try, they
charge you with sexual harassment.” I said, “Then how do you get them to
do what you need them to do?” He said, “We don’t. We just let them do
whatever they want.”

I have a friend who was forced out of the service only a few years before his scheduled retirement due to false sexual harassment charges.  The reason his female subordinate made up the charges had nothing to do with his relationship with her, she was just angry that he had disciplined one of her male friends for committing a crime.

Women in the military destroy more than unit cohesion, they destroy all military discipline across the board, from the top to the bottom.  It’s exactly the same as the difference between raising a generation of children in the traditional manner, and raising a generation using only single mothers. We already have a feral black underclass and an increasingly feral white one; in another two decades we will likely have an equally feral military.

This is precisely why I support an all-female U.S. military populated by a draft.  Anything less would be sexist and fail to account for more than 200 years of unmitigated male privilege.

The grimy pessimism of George RR Martin

Rowan Light addresses the silly and unjustified claim that George RR Martin’s epic work is comparable, let alone superior, to JRR Tolkien’s The Lord of the Rings:

Though Martin knows how to tell a good story, brilliantly weaving his
complex plots with familiar tropes (without falling into kitsch), his
appeal depends on more than just skilful prose. Brutal cruelty, sex, and
disloyalty are the hallmarks of Martin’s world. This makes him, it is
argued, far more realistic than Tolkien. As Lev Grossman, the fantasy
author who first dubbed Martin “the American Tolkien”, writes,

“What … distinguishes Martin, and what marks him as a major force for
evolution in fantasy, is his refusal to embrace a vision of the world
as a Manichean struggle between Good and Evil. Tolkien’s work has
enormous imaginative force, but you have to go elsewhere for moral
complexity.”

There are no clear “goodies” in Westeros. Characters are honourable
or treacherous depending on the day of the week. Good guys finish last
and those who cling to noble principles are manipulated and/or beheaded.
We sympathize with immoral characters like the incestuous Lannisters,
Varys the Eunuch, and an assortment of murderers, rapists, and sadists.
Nothing is taboo.

Tolkien’s G-rated narrative, critics argue, has burdened the fantasy
genre with a “Disneyland Middle Ages”. Martin is more meaningful because
he is morally ambiguous.

Although he is an admirer of Tolkien, Martin notes that “the whole
concept of the Dark Lord, and good guys battling ugly guys, Good versus
Evil … has become a kind of cartoon.” Fantasy doesn’t need any more Dark
Lords or hideous enemies, because “in real life, the hardest aspect of
the battle between good and evil is determining which is which”.

“I’ve always liked grey characters”, Martin said in a 2001 interview,
“And as for the gods, I’ve never been satisfied by any of the answers
that are given. If there really is a benevolent loving god, why is the
world full of rape and torture? Why do we even have pain? … Why is agony
a good way to handle [death]?”

The “game of thrones” is a cynical view of politics with its
factional back-stabbing, unbridled lust, fickle allies and treacherous
families. The anarchic world of Westeros is fundamentally defined by the
ladder to power. “Some are given a chance to climb but they cling to
the realm or the gods or love – illusions!

Only the ladder is real; the
climb is all there is”, says the amoral and supremely calculating Lord
Baelish.

In this moral fog there is no room for nobility and beauty. “Of all
the bright cruel lies they tell you, the crudest is the one called
love”, Martin wrote in his 1976 short story “Meathouse”. But the
“realist” fantasy is limited to the basest dimensions of human
experience. It’s like reading a newspaper which only features articles
about Ariel Castro the Cleveland rapist, al-Qaeda suicide bombers and
waterboarding at Guantanamo Bay. It is hard to imagine anyone wanting to
live eternally in the brutal and sadistic Westeros.

Is Tolkien really less realistic, though?

The problem with Martin and his imitators is that their works reflect their crabbed and ugly souls.  It is interesting to compare the early reviews of Martin’s first two books with the latest two books in the series; Martin is increasingly committing some of the very acts that he was praised for avoiding in the beginning.

Does anyone believe that John Snow is truly dead?  Did anyone fail to notice that Martin ended A Dance with Dragons in much the same way that cheap sitcoms of the 1970s once ended their seasons? And how many characters that we were led to believe were dead are still wandering around Westeros in varying stages of life and undeath? Who has not marked the tragic decline of Tyrion Lannister from the witty dwarf who surmounted his short stature to the silly fool who falls off pigs?

Tolkien’s world was original and breathtaking. Martin’s is derivative and flat. Tolkien was a master of the structure of the epic tale. Martin wrote himself into an obvious structural impasse. But worst of all, where there is depth of soul and all the grandeur of Creation in Tolkien’s work, there is neither soul nor beauty in Martin’s. Martin focuses solely on the petty and ugly aspects of life, rendering his magnum opus more a commentary on his own nihilistic perspective than one upon the world in all its joys and sorrows.

Light is absolutely correct when he concludes that Tolkien “will still be sitting on the throne of fantasy in a hundred years’ time
while George Martin will be dismissed as the practitioner of an early
21st Century fad for grimy pessimism.”

It’s not that Martin is a mediocre fantasy author.  He is, in fact, a very good one.  I very much enjoyed the first three books and I hope that the sixth one will have more in common with them than its immediate predecessor. But it should not escape the reader’s attention that most of the superlatives praising Martin so highly predate A Dance with Dragons. 

This is why I don’t take either the effusive praise or the disdainful dismissals of A Throne of Bones very seriously. The story is not even one-quarter told.  The jury is still out on Martin and it has barely even begun being selected on my behalf.  But one thing I find very encouraging in this regard is the way in which my self-appointed enemies keep posting shamelessly dishonest reviews and trying to discourage people from reading Arts of Dark and Light.  They just don’t seem to realize that if A Throne of Bones were truly as terrible as they say, or even merely mediocre, they would be encouraging everyone to read it.

Ruthless compliance

The Marine Corps appears to be going about complying with the Defense Department’s decision earlier this year to repeal the Direct Combat Exclusion Rule in a correct and effective manner.

The Marine Corps will allow enlisted women to participate in basic infantry training beginning this fall as part of ongoing research to determine what additional ground combat jobs may open to female personnel.

New female enlisted Marines will volunteer for spots in the service’s Infantry Training Battalion, mirroring a related effort allowing new female lieutenants to enroll in the Corps’ Infantry Officer Course, according to an official planning document obtained by Marine Corps Times. Titled “Assignment of Women in Combat Units,” the document is dated Aug. 16.

“Female Marines will have the opportunity to go through the same infantry training course as their male counterparts,” the document states. However, as with the research involving female officers, “female enlisted Marines who successfully complete infantry training as part of this research process will not be assigned infantry as a military occupational specialty and will not be assigned to infantry units.”

The correct way to address female claims to equality is always to insist upon completely objective standards.  Women tend to be highly skilled at manipulating subjective standards, which is why so many of them shriek with indignation whenever they discover that their tears, emotional appeals, prostitution, rhetorical sallies, and negotiating tactics will avail them nothing.

Take the oft-cited “women make 77 cents of the male dollar for doing the same job”, for example.  There is a very easy solution to that “problem”. Eliminate salaries and put everyone with the same job on equal hourly wages. Women will still be making less money on average, but their complaints won’t be credible because it is objectively clear why they are earning less: they work fewer hours.  As Kay Hymowitz wrote in the Wall Street Journal, “the famous gender-wage gap is to a considerable degree a gender-hours gap.”

Now, it can be expected that the Marine Corps will eventually come under considerable pressure to reduce the difficulty of its basic infantry training. But with a growing number of Obama Wars to fight, the Corps has very good reason to resist the political pressure to produce inferior Marines, and in the unlikely event a woman proves capable of successfully completing the course, (note that none of the 10 women who have tried have passed the Infantry Officer Course and only one of those ten made it through the course’s very first test), she is likely to be an extraordinary individual who will not be disposed to creating the sort of problems that most women in the military do.

Predictable consequences

It’s absolutely hilarious to see the mainstream media and government employees complaining about private citizens putting what they have learned from the IRS and the mortgage banks into action:

“It must be a mistake,” he said, when the loan officer told him that
someone had placed liens totaling more than $25 million on his house and
on other properties he owned.

But as Sheriff Stanek soon learned, the liens, legal claims on property
to secure the payment of a debt, were just the earliest salvos in a war
of paper, waged by a couple who had lost their home to foreclosure in
2009 — a tactic that, with the spread of an anti-government ideology
known as the “sovereign citizen” movement, is being employed more
frequently as a way to retaliate against perceived injustices.

Over the next three years, the couple, Thomas and Lisa Eilertson, filed
more than $250 billion in liens, demands for compensatory damages and
other claims against more than a dozen people, including the sheriff,
county attorneys, the Hennepin County registrar of titles and other
court officials.

“It affects your credit rating, it affected my wife, it affected my
children,” Sheriff Stanek said of the liens. “We spent countless hours
trying to undo it.”

Cases involving sovereign citizens are surfacing increasingly here in
Minnesota and in other states, posing a challenge to law enforcement
officers and court officials, who often become aware of the movement — a
loose network of groups and individuals who do not recognize the
authority of federal, state or municipal government — only when they
become targets. Although the filing of liens for outrageous sums or
other seemingly frivolous claims might appear laughable, dealing with
them can be nightmarish, so much so that the F.B.I. has labeled the
strategy “paper terrorism.” A lien can be filed by anyone under the
Uniform Commercial Code.

These liens, and many of the “frivolous” claims made by various private citizens are not necessarily fraudulent in the legal sense. There can be no question that they are no more fake than the millions of liens and foreclosures filed by mortgage banks that never held title to the properties they seized and no more illegal than the private MERS system that those banks tried to substitute for the historical county land records.

That is precisely why dealing with them can be so nightmarish; because they are as legal and legally enforceable as anything that the courts produce.  This is nothing but a natural consequence of the government declaring itself and its agents above the rule of law and then being surprised when the people follow its lead.

This is how a civilization falls, one step into barbaric chaos at a time. 

Running out of other people’s money

France’s Socialists are running out of income to tax:

France’s Socialist government has admitted that the country cannot cope with any further tax rises and promised no more hikes just days ahead of the country’s largest ever tax bill.

 In an unfortunate piece of timing, however, the pledge came just as the environment minister announced the creation of a new “carbon tax” and amid reports that the overall tax pressure on French households will rise even further next year.

Returning from their summer break, the French are about to discover stinging rises in tax bills in their letter boxes – the result of a series of new levies enacted by President François Hollande as he seeks to plug the French deficit and bring down public debt – now riding at 92 per cent of GDP.

But the extent of the hikes has apparently even shocked the very Socialist ministers who implemented them. The total tax pressure (taxes and social security contributions) will account for 46.3 per cent of GDP this year – a historic high – compared to 45 per cent in 2012.

The Keynesians have the solution, of course.  Instead of taxing anyone, the government can simply print or borrow the money. In fact, if we follow Keynesian logic to its full extent, there is no need for any government to tax its citizens at all. That’s not an option for France, however, since it turned over its authority for determining its money supply and public debt limits to the European Commission.

It’s fascinating to see highly educated people with the benefit of decades of Socialist economic policy, Keynesian fiscal policy, and Monetarist monetary policy continue to keep insisting that there is no such thing as economic gravity and all an economy has to do to fly is to think positive thoughts.  It doesn’t seem to matter how many times they witness an economy crashing and burning, because as long as it is in the financial interests of the elite to fail to understand that there are limits, they will continue to ignore them.

An atheist incoherency

Clark from Popehat observes an intrinsic contradiction:

The reason for arguing that modern western atheism is incoherent is
not that it is irrational to disbelieve in God; I think that one can be
entirely sane and rational and disbelieve in God (although I actually
think that agnostics have beliefs that are much more consistent with
pure rationality than either theists or atheists, but that’s a side
note).
No, the reason that modern atheists have incoherent views is that they simultaneously

  1. assert that there is nothing beyond that which is visible (i.e. they are materialists)
  2. they believe in rights, and not merely in a legal or social descriptive way, but in an absolute and prescriptive way.

This is not dissimilar from the evolutionist who firmly believes in human equality and asserts race is a myth, failing to grasp that he simply cannot rationally subscribe to both articles of faith.