China's Perfect Storm

Behind Blasts Shortcuts and Lax Rules spectacular blow up in the port city of Tianjin was a grievous and public display of government dysfunction just when Xi Jinping's government has it's hand full dealing with crony capitalist financial incompetence as well.

Zombies Stalking China

A previous post mentioned a fear of China falling into a generation long great recession and today's The Zombie Factories that Stalk China's Economy   proves it.  Paul Krugman's Keynesian remedies will prolong not relieve in this case, but China is so authoritarian they are not likely to think of any other path such as letting state owned factories fail and a free business press report free market clearing prices, Lilian Tett's observation in today's MSNBC Squawk Box, and guide the economy toward viable businesses.

Rand Paul for President

Rand Paul is the only candidate for President that understands that the Constitution of the United States is a government expressly created for the purpose of promoting an individual's sovereign right to life, liberty and the pursuit of happiness*.

* As described by Randy E. Barnett The Structure of Liberty: Justice & the Rule of Law

Bottoms Up

As Economies Gasp Globally, U.S. Quickens congratulates the latest U.S. growth of 3.7% yet laments the slow recovery.  What is great about our economy is its bottom up and therefor credible bubble free growth that will be looked on as part of a long streak of growth similar to the post war economy of the 1950's.
China's authoritarians on the other hand dealt with the economic crisis of 2008 by over investing in housing and  recently the stock market to manage statistics that give the illusion of growth. The consequence is that the apparatchik has zero credibility and is without an economic messenger the likes of Standard and Poors and Dun and Bradstreet that self developed in the U.S. in the 19th century to help free markets guide China forward.  One observation that China may suffer a lost generation to recession similar to Japan's is quite astute and until Xi Jinping decides to shift gears by embracing a business free press there will be no track for the locomotive to drive his economy above it's current plateau.

Many Donors and Volunteers, Not Money

Bernies Sander's Small Beer Donors makes the handwringing over too much money in politics and decrying the Citizens United  Supreme Court decision for allowing billionaires to express themselves with as much money as they wish amusing. The raising of many small donations is not only democratic, it’s politically effective.  Donors commit themselves to candidate.  The more donors, not money, a candidate garners the stronger they become. Stronger to field volunteers to knock on doors and get out the vote for their candidate. Candidates that rely on a few fat cat donors will fail.  Schemes that try to level the supposed money advantage with matching funds from the public just keeps the politician’s eye off the ball of recruiting many donors and volunteers.   

Air Power Destabilizes Again

America's Dangerous Bargain With Turkey is trading a Kurdish alliance for an air base near the border with Syria. It's a tactic that would not be supported by a grand strategy to pacify the region, rather it does the opposite.  As usual in the Middle East the U.S. get the "friend of an enemy is my enemy and the enemy of my enemy is my friend" dynamic all wrong.  Turkey's Erdogan hates the Kurds enough to be a friend of ISIS!

Oasis of Sanity

Inquiry Weighs ISIS Analysis and Ideal Syrian Ally for U.S. are two headlines that show the dearth of thought in American middle east policy.  Without a sane political union on our side we have nothing to leverage.  In Syria we have to start from the beginning protecting and funding refugees in the South East along Jordan's border to develop into an oasis of sanity while the rest of Syria drops off the end of the earth.

Sisi's Egypt Will Self Destruct

Reading Rand Barnett's The Structure of Liberty and found the following quote from the medieval poet Abraham Ibn Ezra: "It is a known fact that every kingdom based on justice will stand.  Justice is like a building.  Injustice is like the cracks in that building, which cause it to fall without a moment's warning." Its what happened to the Shah of Iran celebrating 2500 years of empire and then all of a sudden he isn't.

Abraham Ibn Ezra (1092-1167), as it appears in The Pentatreuch and Hafiorahs, 2nd edition (London: Soncino Press, 1960), p. 856

Three Americans

When hearing about the thwarted terrorist on a French train the assumption was that the Americans that interceded were all American military types.  Which they are!  But the image in Europe of three Americans, high school friends vacationing together, with the multi cultural and ethnic diversity of Skarlatos, Stone and Sadler jars this year's stereotype of divide from Ferguson, Charleston and other ugly scenes. These three guys make us a beautiful country.  

Military Aid for What?

The Questionable Legality of Military Aid to Egypt should really address the questionable aid  that military aircraft provides.  The Shah of Iran had the latest F14 aircraft similar to Maverick's, Tom Cruise character's call sign, in the movie Top Gun when the tipping point was reached in the streets of Tehran and soldiers refused to fire into their own people.  A lot of good those giant lumbering fighter bombers meant for cold war super power confrontation did for the Shah then. How embarrassing for the U.S. to have them in the arsenal of an intractable enemy after the revolution.  When the tipping point in Egypt is reached what good will our F16 aircraft, a lighter more nimble fighter bomber to be sure, do for Sisi to quell an economic street revolt caused by a corrupt crony capitalist state? How less than satanic will our image be when Sisi resorts to dropping barrel bombs from Blackhawk helicopters into resistant enclaves of Egypt?

The Modesty of Libertarianism

Randy Barnett's The Modesty of Libertarianism lecture is the best of Cato University's 2015 excellent offerings.

Distrust and Fear in China

Fear of Toxic Air and Distrust of Government Follow Explosions in China is a classic problem for authoritarian regimes that stifle the press and yet are confounded by public disasters that can't be swept under the rug. Xi Jinping's regime is tottering because economic and governance messages provided by a free and independent press are not there to help authorities level imbalances and diffuse explosive circumstances.

China Keeps Still Eager Global Investors Guessing is a badly worded business headline because there can't be eagerness to invest in a guess.  It's glaringly apparent that China's growth is not at the 7% rate declared these past few years and so what is credible in any of their official pronouncements? Any wealth manager thinking this summer's downturn is one that China will quickly recover from will be lacking in wealth to manage.

The Surge Fallacy

How the GOP is Rewriting the Iraq War in this month's The Atlantic is archived here for future referral.

Trump is bad business

Steve Rattner's Trumps Economic Muddle brings up a good point. How can putting in a chief executive whose primary motivation is looking out for himself be good for a company (four bankruptcies!) or for a country?

Realpolitik

A libertarian assessment of power and position of foreign players should dwell primarily on a political union’s capability at directing resources efficiently. Whether authoritarian, democratic or in between the primary criteria of American foreign policy should be to support those that more or less distribute efficiently and disentangle from those that don’t.  Disentangling means releasing the bolts on a pressure cooker containing a dysfunctional system sooner rather than later and never never defend to the end a regime that does disservice to our Declaration of Independence, such as Vietnam’s Diem regime.

The pressure cooker of the middle east is currently Egypt. A libertarian realism would assess that the arms we provide, typically aircraft, will be useless in the revolution that is sure to come. The revolution in Iran is the perfect example of the counterproductiveness of our full on support of a corrupt dysfunctional regime.  That a revolution is sure to come is a libertarian conclusion regarding Egypt’s crony capitalist market disfunction and absence of the rule of law. When Egypt does convert we stand to be on the wrong side, again, with another unforgivable tarnishing of our heritage of liberty and adding another implacable enemy to our list.

A libertarian realism is one that does not put the cart before the horse when assessing the power dynamics within a region. The horse required is a political union whose citizens, not outside recruits, are willing to fight to the death for their cause. It appears that the lesson not learned by our foreign policy experts is that an attempt to use the military to change an outcome of a weak political union is doomed to fail.  Currently in Iraq, American policy is to jawbone a political union among Shiites, Sunnis and Kurds.  Each of the three sects are unions willing to fight to the death for their own, but not for a unified Iraq.  Libertarian realism would recognize that pursuit of this apparently wrongheaded policy is counterproductive. The evidence for this conclusion is that the few successes in Iraq and Syria have come from the Kurdish pesh merga forces of Iraq’s Kurdistan, the most unified and efficient political union of the region.

Finally, taking sides in a rebellion is counterproductive no matter how grotesque the rebels actions. Assad’s Syria suffers from serious political dysfunction.  The public beheadings of western journalists by ISIS was a rational recruiting and fear mongering tool for establishing a Sunni stronghold in Syria and Iraq.  The braggadocio of a caliphate was tempered by overreach in Kobani, a Kurdish city with a strong interest into not submitting to a Sunni reign.  With this and other setbacks ISIS has now morphed into Daesh, a less imperialistic union practicing a more effective distribution of scarce resources so as to gain political credibility among Sunnis. It’s so much better than Iraq’s tainted distribution by Shiites that Sunnis polled today would indicate a preference to Daesh versus Baghdad.  Destroying ISIS as this point is taking sides in a civil war.

Another rebel group is the Turkish Kurds PKK.  We have taken sides by labeling the group terrorists at Turkey’s behest, yet the Kurds are our ally in the fight against ISIS and so it goes throughout the Middle East.  Taking a neutral position such as Switzerland has a pacifying effect.  Ultimately a pacifying effect is what people want in a foreign policy so that more trade and interpersonal contact is made, also pacifying. Yes a strong military is necessary to defend our citizens and borders but one directed by a foreign policy that doesn’t squander its capabilities. One that pacifies rather than provokes.  

Conservatives versus Libertarians

This Cato debate’s principal insight is that Conservatives come a from a few in command determining and enforcing a social order while the Libertarian perspective is that the social order bubbles up from below from individuals and communities.

Seperate Church and State

Jeb Bush Causes a Stir on Women's Health Issues is an example of authoritarian pandering augmenting tension rather than leadership defusing it.

Saving Tunisia

Saving Tunisia From ISIS s subject that requires thought beyond just do something.

Shoot Me

Rival Insurgents Surprise Syrians Supported by U.S. shows such an abysmal lack of understanding of military and political reality that the consultant group that developed this plan should be sent to the corner with a dunce cap.

Don't Underestimate Hubris

The handwringing over too much money in politics and decrying the Citizens United  Supreme Court decision for allowing billionaires to express themselves with as much money as they wish is amusing, if not hilarious in the case of Donald Trump.  The Donald is a lucky guy who thinks it was his brains that got him where he is today.  There is no evidence that money and celebrity status can grow his thoughtless candidacy beyond a tiny unthinking base of voters.

After the 2012 Presidential Campaign the G.O.P. did an audit on the election and came to the conclusion that brains beats money in politics.  The first aspect of brains is to come to a reasonable decision after gathering and discussing the pertinent facts.  Today’s web based intelligence gathering capabilities anticipate customer needs and wants almost before they can express them which makes for a completely different political tool where each voter’s inclination is determined in a seemingly clairvoyant way.  It puts the top down Fox News political machine in the 1950’s position of selling politics like soapy suds. Top down uses big money to spread a message to the least common denominator while the new fangled big data approach allows for a nuanced campaign bubbling up.

For example every campaign has workers bring those people to the polls that they identify as likely to vote for their candidate.  Ohio was a key state in the 2012 election and the two sides had different approaches.  Big money Fox based advertising blanketed the state with its closed loop developed message.  The Obama team’s big data on the other hand made small economical purchases at what appeared to the opposition as coming from lack of funds but were in actuality smart little bets.  Fox’s sweeping ads attracted as well as insulted voters.  The Obama team knew who had been insulted and gathered them up.  They also had a better handle on who to take to the polls and who to ignore or to let the clueless opposition take and let disappoint in the privacy of the polling machine.  The most hysterically funny political scene, ever, is on the 2012 election night when Megyn Kelly's group has to tell a sputtering Karl Rove that yes, despite all his data to the contrary, he lost Ohio.  Koch brothers et al weren’t amused either.

The audit makes clear that more efficient advertising is required.  Due to federal election laws big money groups can not directly coordinate their activities with a campaign.  Sure there will be a lot of eye winking et-cetera but the problem is that  big data requires really really close coordination so that the outside money will always be the stupid money.  Stupid in the way TV Stations overcharge them and then of course the message is always simple, bludgeoning and repeated ad nauseum so that it can run counter rather than add support.  

The Donald  has free publicity because of his celebrity status so that it appears he has an unfair advantage but then of course there is no accounting for the insults. But once he departs the Republican primary with either a withdrawal or a third party candidacy the G.O.P. still suffers from a thoughtless belief, faith if you will, in a dogma that doesn’t fit well with big data.  Creationism is an example of a science that rejects evidence contrary to its theory. A candidate espousing creationism in the schools is not one to embrace a big data conclusion on anything much less a political campaign.  Nor is he likely to attract an intelligent practitioner of big data to guide him.  A big money operative directing his minions to go find a big data person for a campaign may get a brilliant mercenary, but the mercenary’s light will go out with the lack of intelligent interaction in the king’s court.

The Citizens United decision by the Supreme Court is correct in staying out of the minutia of determining what is and isn’t free speech. That it has the appearance of giving an unfair advantage to the billionaire class is true, but not necessarily so.  On the other hand free speech is a right worth preserving in as pure a manner as possible because there always are issues. Funny though how those pressing issues just float away from memory when the hubris of the actor’s finally catches up to them.