One Stop Thought Shop

On Alan Greenspan leading us far into chaos:

He was working for the same person we all work for, himself, at the same task we all work at, i.e., to square his life as lived with the ideals he held. What helped foster the financial crisis was that society has no recognized procedures for dealing with people who are trying to live according to destructive ideals. That’s one of the problems with principles-based vs rules-based regulation. He was working with the wrong principles, and there weren’t the right rules to stop him.

Expanding soon to every region, just as the heavy use of antibiotics contributed to the rise of drug-resistant super germs, Monsanto’s aggressive distribution of the weedkiller Roundup has led to the rapid growth of relentless super weeds.

What is ‘regulatory capture? Here’s a superb example:

A ‘remote dead man’s switch’ isn’t required under U.S. law but is well-known in the industry and mandated in other parts of the world where BP operates.

See? It’s that heavy iron blowout preventer that failed.

When an explosion and fire crippled the deepwater drilling rig on April 20, workers threw a switch to activate the blowout preventer, which is designed to seal the well quickly in the event of a burst of pressure.

They have continued to focus their attention on a 40-foot stack of heavy equipment 5,000 feet below the surface of the gulf, a blowout preventer, the steel-framed stack of valves, rams, housings, tanks and hydraulic tubing, painted industrial yellow and sitting atop the well in the murky water, is at the root of the disaster. It did not work, and a failsafe switch on the device also failed to function.

Still, Mr. McCormack said, “something is working there because you wouldn’t have such a relatively small flow of oil.” If the blowout preventer were completely inoperable, he said, the flow would be orders of magnitude greater.

Warning more are on the way, the Deepwater Horizon blowout was predicted in 2008.

Risking an oil spill 30 times worse than from BP’s much larger Atlantis deep water rig, get this: 85 percent of subsea components did not receive engineer approval and 95 percent of subsea welding did not receive final approval.

Yes, let’s now question the integrity of thousands of crucial welds on subsea components.

A very serious breech. Already more than two dozen lawsuits. British Petroleum failed. Halliburton too? Agencies failed. Blame is necessary.

BP’s 2009 ‘impact analysis’ filed with the federal Minerals Management Service repeatedly asserted that an oil spill and serious damage to beaches, fish and mammals was unlikely or virtually impossible. To quote:

“…due to the distance to shore and the response capabilities that would be implemented, no significant adverse impacts are expected.”

Already lawyers are  revealing that BP may not have addressed the kind of technology needed to control a spill at that depth of water.

In six- to nine-foot seas, the slick nearly tripled in just a day or so, growing from a spill the size of Rhode Island to something closer to the size of Puerto Rico.

The type of oil involved is also a major problem. Most of the oil drilled off Louisiana is a light crude. This oil is an older, heavier blend from deep under the ocean surface, and is very dense.

“If I had to pick a bad oil, I’d put this right up there.” Asphalt-like substances that make a major sticky mess, “a thick gooey mousse”.

There are three types of beaches: sandy, rocky and marshy. Florida’s sandy beaches are easier to clean. By far the hardest are marshlands, so delicate that cleaning is damage too.

Edward Harrison:

Of course the US deficits are too large. Come on: 10% deficits as far as the eye can see are unsustainable over the long-term. The key word, however, is long-term.

No one seems to understand the difference between short-term and long-term and the debate has become an ideological free-for-all.

Anyway, the point is that the US economy will not be able to sustain recovery for long without stimulus. The likely result of withdrawing stimulus is a recession that is deeper than the last one, a major depression.

He seeks to explain:

Policy is exogenous and deficits are endogenous.

What that essentially means is that when I think about government, I view it with suspicion and my inclination is to seek to limit its size and scope. That means I have an innate disaffection for big government, deficit spending, money printing, etc. – but not in an ideological way.  It all depends on the circumstances.

HA! You knew that.

via James Kwak:

“You’ve criticized the government for withdrawing from the economic and particularly financial sphere and allowing private sector actors to do whatever they wanted. Do you think the government should simply act so as to correct the imperfections in free markets? Or do you see a positive role for government in determining what kind of an economy we should have?”

“College works on the factory model, and is in many ways not suited to training entrepreneurs. You put in a student and out comes a scholar.” [link]

The session started off with a film from John De Graaf called, “What’s the Economy for Anyways?” which examined American society under the conclusions of Gifford Pinchot, the first Chief of the U.S. Forest Service who defined the economy as, “The greatest good for the greatest number over the long run.”

Using that metric, the US economy has done a terrible job since 1970.

The US leads the world in GDP but its citizens suffer on nearly every major health and quality of life metric.

The key point here is breaking down the GDP myth.

Matt Taibbi on how greed-is-good conquered America and the simply inevitable folly of brigands:

Even if he stands to make a buck, your average used-car salesman won’t sell some working father a car with wobbly brakes then buy life insurance policies on that customer and his kids.

As  Ayn Rand and Greenspan and foolish minions from Reagan to Bush put it:  ‘How To Buy A Car Without Rules’.

The Wonderful World of American Fraud:

You distract the dumbshits with free-market B.S. because hey, for whatever reason, that’s what the public likes to hear, it doesn’t really matter what lie you feed them so long as it’s the lie that puts them in a trance.

And then behind the scenes, you do the very opposite: You fix the game, you cover up this problem here with those funds there, you move shit around, you skim budgets and you subsidize the system, you cover up the bad shit and once in a while throw a has-been to the wolves to keep the public entertained—that’s the way the system works, and anyone who’s an adult understands that.

What surprised you the most as you researched the history of orange juice?

The degree to which consumers have bought the myths that the industry has created about orange juice.

You say in your book that consumers act like robots when it comes to orange juice. What do you mean?

Orange-juice drinkers are misinformed about what it is they are drinking.

Flavor packs are made from the chemicals of orange essence and oil. Flavor and fragrance houses, the ones that make high end perfumes, break down orange essence and oils into their constituent chemicals and then reassemble the individual chemicals to resemble nothing found in nature. Ethyl butyrate is one of the chemicals found in high concentrations in the flavor packs added to orange juice sold in North American markets, because flavor engineers have discovered that it imparts a fragrance that Americans like, and associate with a freshly squeezed orange.

Right now the formula for fresh orange flavors is just about as secret as the formula for Coke.

My intent was not to get people to stop drinking orange juice but to realize what it is they’re drinking.