Saturday, March 11, 2006

The dumbest economic policy of the year

Longtime readers of might believe that, given my rantings on the scuttled ports deal, that I would say this is the stupidest economic policy implemented this year.

You would be wrong.

No, when it comes to ass-backward economics, I'm afraid that not even the United States Congress can compete with Argentinian president Nestor Kirchner. Patrick McDonnell explains in the Los Angeles Times:

Argentine President Nestor Kirchner has a plan to fight rising inflation and escalating food prices: Let them eat beef.

In an extraordinary decision, the government this week announced a six-month ban on most beef exports from the world's third-largest purveyor of the meat.

In Argentina, prime beef is a cultural icon, rivaling tango, soccer and the late Eva Peron. Argentines are voracious beefeaters, consuming 143 pounds per capita annually.

But consumers here have been grumbling about beef prices for months, and Kirchner — a left-leaning populist often at odds with big business — presented the ban as a way to protect his people from export-driven price hikes.

The government hopes that meat targeted for overseas sale will now stay at home. Increased supplies will reduce domestic prices, which skyrocketed 20% last year, surpassing the worrisome inflation rate of more than 12%.

"It doesn't interest us to export at the cost of hunger for the people," Kirchner declared.

The president's edict took effect Friday. Delighted shoppers rushed to butcher shops to inquire whether prices had dropped yet from the $2 or so a pound for the prime cuts that can go for 10 times as much in the United States and Europe.

"The president's move was absolutely necessary in the moment we are living," said Hector Polino, who heads a consumer group that is critical of rising prices.

What will the effects of an export ban be? McDonnell summarizes this nicely:
[C]attlemen said Kirchner's move would kill the golden calf. Beef exports earn vital foreign exchange for Argentina and amounted to a record $1.4 billion last year. Foreign sales rose 24%.

Cattle farmers say the export ban will probably reduce supplies in the long term, cost them hundreds of millions of dollars and throw thousands of people out of work.

"The plants will begin to shut down," Carlos Oliva Funes, president of Swift Armour Argentina, a large meat producer, told the conservative daily paper La Nacion.

"This is like telling Colombia it cannot export coffee," said Javier Jayo Ordoqui, who heads a rancher's association outside Buenos Aires, the capital. "This is cattle country."

Indeed, on Friday, prices were reported to have plunged as much as 20% at Liniers, the country's largest live cattle market. Economists predicted that modestly lower prices would eventually trickle down to consumers.

Kirchner will lower beef prices -- in the most damaging, inefficient way possible.

posted by Dan at 10:55 AM | Comments (17) | Trackbacks (0)

A new twist on Fight Club

The first rule of watching Fight Club -- try not to think about the plot holes in Fight Club.

Naturally, I violated this rule the first and only time I watched it. The thing that kept running through my head was, "Gee, all of the people who supposedly hold these degrading jobs seem to be Anglos. I'm pretty sure in the real world a large fraction of these jobs would be taken by immigrants."

I raise this because of the front page of the Chicago Tribune this morning:

In a show of strength that surprised even organizers, tens of thousand of immigrants poured into the Loop Friday, bringing their calls for immigration reform to the heart of the city's economic and political power.

What started as a word-of-mouth campaign, then spread through the foreign language media, grabbed the attention of the entire city by midday, as a throng 2 miles long marched from Union Park on the Near West Side to Federal Plaza.

Police estimated the crowd as large as 100,000, making it one of the biggest pro-immigrant rallies in U.S. history, according to national advocates.

Observers said the turnout could galvanize both sides in the immigration debate, launching a grass-roots pro-immigrant movement while provoking a backlash among those who want stricter controls.

The trigger for the rally was a controversial federal bill that would crack down on those who employ or help illegal immigrants. But the broader message--carried mostly by Mexicans, but also by a smattering of Poles, Irish and Chinese--was that immigrants are too integral and large a part of Chicago to be ignored.

This was the part that reinded me of Fight Club:
As they transformed the Loop with their presence, immigrants made a powerful statement elsewhere by their absence.

Without his immigrant employees, a Northwest Side body shop owner gave up and closed for the day. An Italian restaurant in Downers Grove relied on temps to cook and managers to bus tables. High school students walked out en masse....

Whole shifts of workers left their jobs to underscore the importance of immigrant workers. One server from an Italian restaurant came in his work tie and apron, draped with a U.S. flag. Construction workers, still wearing hardhats, came straight from their job sites. Clerks from the El Guero market in Aurora piled into the store's delivery van, riding on produce boxes.

Alex Garcia and about 10 co-workers from a Joliet commercial sign company rode a Metra train to Chicago's Union Station, walked out to Union Park, and then retraced their steps as they marched back to the Loop.

"Most people don't realize how much work we do, but it's part of their daily lives," he said. "We are putting up all the buildings and cooking all the food. Today, they'll understand."

With Congress already set to enhance its ability to block foreign direct investment, I, for one, look forward to a reasoned, rational debate on immigration policy.

posted by Dan at 09:33 AM | Comments (17) | Trackbacks (0)

Thursday, March 9, 2006

March's Books of the Month

The theme of this month's books is that they're both about how the policy hangover left by the Bush administration.

The international relations book is Francis Fukuyama's America at the Crossroads: Democracy, Power, and the Neoconservative Legacy. This short book provides a nice summary of Fukuyama's take on neoconservatism, why he parted ways with other neocons on the war with Iraq, and where to go from here. I've only gotten through the first chapter so far, but the book does an excellent job of providing an intellectual history of neoconservative thought. Like Matt Yglesias, I'm not exactly sure how Fukuyama's "realistic Wilsonianism" is different from "just regular old liberal internationalism," but I haven't finished the book yet, so give me time. UPDATE: Well, now I've finished it, and it turns out Fukuyama thinks the same thing on p. 215: "What I have labeled realistic Wilsonianism could be alternatively described as a hard-headed liberal internationalism."

The general interest book for this month is Bruce Bartlett's Impostor: How George W. Bush Bankrupted America and Betrayed the Reagan Legacy. Publisher's Weekly has a concise symmary:

Bartlett's attack boils down to one key premise: Bush is a shallow opportunist who has cast aside the principles of the "Reagan Revolution" for short-term political gains that may wind up hurting the American economy as badly as, if not worse than, Nixon's did. As part of a simple, point-by-point critique of Bush's "finger-in-the-wind" approach to economic leadership, Bartlett singles out the Medicare prescription drug bill of 2003— "the worst piece of legislation ever enacted"—as a particularly egregious example of the increases in government spending that will, he says, make tax hikes inevitable. Bush has further weakened the Republican Party by failing to establish a successor who can run in the next election, Bartlett says. If the Reaganites want to restore the party's tradition of fiscal conservatism and small government, he worries, let alone keep the Democrats out of the White House, they will have their work cut out for them.
How damning is the book? The Bush administration could not send anyone rebut Bartlett at a Cato forum on Bartlett's thesis.

Impostor really should be read with Hacker and Pierson's Off Center, because the two make for a very interesting comparison. Hacker and Pierson don't like Bush because they think he and his Congressional allies have shifted policy in a dramatically rightward direction. Bartlett doesn't like Bush because he thinks Bush and his allies have shifted policy in a dramatically Nixonian direction. The chapters in both books on Bush and regulation make for very interesting reading. [SIDE NOTE: Hacker and Pierson have written a response to my Forum book review. University types can access it here. I may respond to their response if I find the time.]

Go check them out!!

posted by Dan at 09:40 PM | Comments (7) | Trackbacks (0)

Well, I feel much safer

I, for one, feel much safer that Dubai Ports World won't be operating port terminals at six American ports. Yes, even though shipping experts and homeland security experts agreed that there was little risk in having DPW take over P&O, I'm glad an American company will be running things.... even if U.S. capital might be more efficient at doing something else.

I feel particularly safe because even though DPW has pledged to divest its ownership of American operations, Knight-Ridder reports that Congress isn't taking any chances:

Senate Democrats pressed ahead with attempts to block DP World's takeover, and House leaders weighed whether to proceed as well.

Critics of the original deal weren't backing away from congressional action.

"I'm skeptical," said Rep. Mark Foley, R-Fla. "I'd prefer (legislation) go through because it gives us a safeguard."
Likewise, Rep. Jerry Lewis, R-Calif., the chairman of the House Appropriations Committee, said he didn't intend to remove the ports provision from an emergency spending bill for hurricane relief and the war in Iraq.

Rep. Ileana Ros-Lehtinen, R-Fla., added: "Congressional plans are to move forward with the appropriations language next week which kills the transaction. Just to make sure."

And might I finally add that I feel ultrasafe upon hearing word that the US Trade representative is planning to postpone talks for a USA-UAE free trade agreement. We sure sent the proper signal to foreign investors -- and it's not like the UAE could retaliate or anything.

With just a little more effort, I'm convinced that U.S. lawmakers can convince everyone in the Middle East that it doesn't matter how much you try to buy into the U.S.-promoted liberal economic order, no one will really trust you.

[Snarked out yet?--ed.] Yes, that felt good.

Whatever you think of the ports deal, this has been a major foreign policy f$%#-up. The UAE is the closest thing we have to a reliable, stable, Westernized ally on the Arabian peninsula, and both official Washington and the American public just pissed on their leg.

There is a lot of blame to go around here on this one, but I must reluctantly conclude that the Bush administration should shoulder most of it. Bizarrely, this is a case where I think they got the policy right but royally screwed up the politics. Both the failure to keep Congress in the loop after the CFIUS approval and the veto threat without consultation guaranteed a Congressional revolt.

I can't blame Congressmen too much for acting like short-sighted glory hogs driven by electoral considerations -- that's their job. So I'll join the crowd and blame Bush.

posted by Dan at 08:45 PM | Comments (31) | Trackbacks (0)

The state of the Democratic party leadership

Jacob Weisberg -- come on down and tell us how you really feel about the Democratic leaders Nancy Pelosi, Harry Reid, and Howard Dean: Since assuming their positions, the three of them have shown themselves to be somewhere between useless and disastrous as party leaders. Individually, they lack substance and policy smarts (Pelosi); coherence and force (Reid); and steadiness and mainstream appeal (Dean). Collectively, they convey an image of liberal elitism, disarray, and crabbiness. Of the three, I think Pelosi comes off the worst:

To understand [Pelosi's] politics, think Huffington Post without the flashes of wit. Here is a typical Bush-bashing, cliché-ridden quote of hers: "The emperor has no clothes. When are people going to face the reality? Pull this curtain back!" Pelosi dismisses people who disagree as hoodwinked or stupid. She's not exactly Hillary Clinton herself, though. A five-minute interview is usually sufficient to exhaust her knowledge on any subject.
I certainly hope that in his next essay Weisberg will stop sugar-coating and tell us what he really thinks.

posted by Dan at 12:21 PM | Comments (9) | Trackbacks (0)

Wednesday, March 8, 2006

Guess who wrote this report?

A major organization has just released its report on the U.S. human rights record in 2005. The report does not paint a pretty picture:

There exist serious infringements upon personal rights and freedoms by law enforcement and judicial organs in the United States.

Secret snooping is prevalent and illegal detention occurs from time to time. The recently disclosed Snoopgate scandal has aroused keen attention of the public in the United States. After the Sept.11, 2001 terrorist attacks, the U.S. President has for dozens of times authorized the National Security Agency and other departments to wiretap some domestic phone calls. With this authorization, the National Security Agency may conduct surveillance over phone calls and e-mails of 500 U.S. citizens at a time. It is reported that from 2002 through 2004, there were at least 287 cases in which special agents of FBI were suspected of illegally conducting electronic surveillance. In one of the cases,a FBI agent conducted secret surveillance of an American citizen for five years without notifying the U.S. Department of Justice. On Dec. 21, 2005, the U.S. Senate voted to extend the Patriot Act,a move that aroused keen concern of public opinion. The law makes it easier for FBI agents to monitor phone calls and e-mails, to search homes and offices, and to obtain the business records of terrorism suspects.... the U.S. Defense Department had been secretly collecting information about U.S. citizens opposing the Iraq war and secretly monitoring all meetings for peace and against the war. According to a report of the New York Times, in recent years, FBI had been collecting information on large numbers of non-governmental organizations that participated in anti-war demonstrations everywhere in the United States through its monitoring network and other channels. The volume of collected information is stunning.

Now, guess who wrote this report?
Is it: 1) Amnesty International
2) Human Rights Watch
3) Freedom House
4) American Civil Liberties Union
5) The State Council of the People's Republic of China
You can find out the answer by clicking on the links.... or read after the jump.

Obviously, the only interesting answer is China.

Here's my question -- although some of the facts asserted in the report don't ring true ("the income level of African American families is only one-tenth of that of white families"), on the whole the report is about as well sourced as your typical NGO.

So, why was my instinct to automatically reject it? Because it's more than a bit rich for China's government to lecture the United States about surveillance techniques it carries out on a routine basis. However -- and here's the disturbing question -- if the U.S. engages in these practices as well, then what is the external validity of its own human rights report?

posted by Dan at 11:29 PM | Comments (15) | Trackbacks (0)

Virginia Postrel is my hero

Click here and here for why.

And it's nice to see that her writing talents are also getting their due.

posted by Dan at 09:14 AM | Comments (5) | Trackbacks (0)

The House of Representatives engages in reasoned debate

Looks like the House of Representatives doesn't want to wait for the results of a 45-day review of the port deal, according to the Washington Post's Jonathan Weisman:

Efforts by the White House to hold off legislation challenging a Dubai-owned company's acquisition of operations at six major U.S. ports collapsed yesterday when House Republican leaders agreed to allow a vote next week that could kill the deal.

Appropriations Committee Chairman Jerry Lewis (R-Calif.) will attach legislation to block the deal today to a must-pass emergency spending bill funding the wars in Iraq and Afghanistan. A House vote on the measure next week will set up a direct confrontation with President Bush, who sternly vowed to veto any bill delaying or stopping Dubai Ports World's purchase of London-based Peninsular & Oriental Steamship Co.

"Listen, this is a very big political problem," said House Majority Leader John A. Boehner (R-Ohio), explaining that he had to give his rank-and-file members a chance to vote. "There are two things that go on in this town. We do public policy, and we do politics. And you know, most bills at the end of the day, the politics and the policy kind of come together, but not always. And we are into one of these situations where this has become a very hot political potato."

Ron Bonjean, spokesman for House Speaker J. Dennis Hastert (R-Ill.), said GOP leadership is "endorsing the viewpoint of our members and Chairman Lewis that we do not believe the U.S. should allow a government-owned company to operate American ports."

White House spokeswoman Dana Perino said last night that the administration is "committed to keeping open and sincere lines of communication with Congress." She added, though, that "the president's position is unchanged."....

The House is still boiling. Armed Services Committee Chairman Duncan Hunter (R-Calif.), with bipartisan support, introduced legislation yesterday that would scuttle the deal; mandate that the owners of "critical infrastructure" in the United States, including ports, highways and power plants, be American; and demand that cargo entering U.S. ports be screened within six months of passage.

Hey, you ask me, Hunter is being too conservative. Why not require all employees as "critical infrastructure" facilities to be red-blooded Americans? Why aren't airports and airlines included? Why, do you realize that, even as I type this, there are foreign-born pilots flying state-owned airliners within a few miles of our major cities???!!!

And, you know, there are lots of products that make up America's "critical infrastructure" beyond transportation and tilities? What about oil and energy firms? Steel? Automobiles? Will wool and mohair be next? UPDATE: Bill Harshaw makes an excellent point in the comments -- we shouldn't let foreign governments intervene in our financial markets either! Surely such a law wouldn't affect America's economic position. Oh, wait.... ]

If the House had proposed this after the 45-day review, I could believe that some serious thought was going into this bill, even if I disagreed with it. What's going on now, however, is just protectionist bulls$%t.

posted by Dan at 08:37 AM | Comments (24) | Trackbacks (0)

Tuesday, March 7, 2006

Blegging for help when the web works against me

I'm having two difficulties with the blog right now, and I'm appealing to the techies in the crowd for help:

1) The comment spam has become unbearable since upgrading my Moveable Type software, because it required me to get rid of MT-Blacklist. It's been suggested that the only way for me to fix this is to use Typekey, but I'd rather not foce my commenters to register. Is there an anti-spam plug-in I can use?

2) The New York Times' Opinionator has apparently linked to my post on income inequality, but since I don't subscribe, I have no friggin' clue what they've said. Will someone with a subscription please post what was said in the comments?

I bleg you, good people -- help out this poor, befuddled blogger.

UPDATE: Thanks to everyone for the assistance. Tthere may be some technical difficulties as I try to install some of these spam blockers.

posted by Dan at 09:09 AM | Comments (11) | Trackbacks (0)

How IR theory becomes OBE

There is a constant refrain for IR scholars to study "the real world," to analyze real world problems, generate policy-relevant theory, create work that speaks to the here and now. And, in truth, although the field can be faddish, there are ways in which, like many other disciplines, it moves slowly.

I bring this up because of Chris Gelpi, Peter Feaver, and Jason Reifler have an article in the Winter 2005/2006 issue of International Security entitled "Success Matters: Casualty Sensitivity and the War in Iraq." The nut of their argument:

In this article, we argue that the public will tolerate signiªcant numbers of U.S. combat casualties under certain circumstances. To be sure, the public is not indifferent to the human costs of American foreign policy, but casualties have not by themselves driven public attitudes toward the Iraq war, and mounting casualties have not always produced a reduction in public support. The Iraq case suggests that under the right conditions, the public will continue to support military operations even when they come with a relatively high human cost.

Our core argument is that the U.S. public’s tolerance for the human costs of war is primarily shaped by the intersection of two crucial attitudes: beliefs about the rightness or wrongness of the war, and beliefs about a war’s likely success. The impact of each attitude depends upon the other. Ultimately, however, we find that beliefs about the likelihood of success matter most in determining the public’s willingness to tolerate U.S. military deaths in combat.

Our findings imply that the U.S. public makes reasoned and reasonable judgments about an issue as emotionally charged and politically polarizing as fighting a war. Indeed, the public forms its attitudes regarding support for the war in Iraq in exactly the way one should hope they would: weighing the costs and benefits. U.S. military casualties stand as a cost of war, but they are a cost that the public is willing to pay if it thinks the initial decision to launch the war was correct, and if it thinks that the United States will prevail.

This thesis caused quite a sir a few months back, when Bush was outlining the "National Strategy for Victory In Iraq." I wrote then:
The assumption underlying Feaver and Gelpi's hypothesis is so simple that it's never stated in the article -- if a sufficiently large majority opposes an ongoing military intervention, any administration will have to withdraw regardless of the strategic wisdom of such a move. This is why, I suspect, the administration reacts so badly whenever it deals with domestic criticism about the war -- it recognizes that flagging domestic support will translate into a strategic straitjacket....

The Feaver/Gelpi solution to this conundrum is to have the President spell out a clear definition for victory. And my suspicion is that they're right -- so long as that definition contains criteria that can be verifiable by non-governmental sources.

Three months ago, the Feaver/Gelpi thesis was politically controversial. Now it's OBE -- overtaken by events. Given the current state of affairs in Iraq, public opinion has already rendered its judgment on what's happening there. I don't think the administration will succeed in translating those peceptions into any definition of victory that I'm familiar with.

So, In between the new story on this article, and the widespread availability of the article itself, the real world has moved on.

This does not mean, by the way, that thesis contained in the paper is wrong. It's just that it's no longer politically salient.

posted by Dan at 12:48 AM | Comments (13) | Trackbacks (0)

Monday, March 6, 2006

I get around...

One of the virtues of driving cross country several times is that you can produce this map:

create your own visited states map

[Yeah, but you study international relations. What about the rest of the world?--ed.] Then you get this map:

create your own visited countries map

One of my goals in life is to color in a lot of the white space south of the equator.

Hat tip: Daniel Nexon.

posted by Dan at 12:57 PM | Comments (17) | Trackbacks (0)