Wednesday, October 28, 2009

Government Fails Again!

The Volatility Blog is turning out to be a real find. Once again, it has exposed another fetid instance of government abdication of responsibility masquerading as worthy and effective legislative initiative. The action of The House Financial Services Committee, under the errant and feckless stewardship of Barney Frank, is precisely the sort of horrid performance that argues in favor of effecting a complete turnover of the Federal Legislature, arguably the most toxic public body operating in the United States today.

The purpose of government is to act as an ombudsman for the citizenry, a bulwark against the incessant predation by the private sector on the public. One almost imagines this latest example of our law makers in action as a textbook case of how a key government body (mal) functions inside a failed state as former Assistant Secretary of The Treasury, Paul Craig Roberts, asserts we are.


DED said...

Good analysis by the Volatility blog.

Re: $400/gallon.
US News & World Report stated in their April 2009 issue that the cost was $25/gallon. If you follow the links that one blogger quotes from another you finally get to an explanation:

The $400 per gallon reflects what in Pentagon parlance is known as the “fully burdened cost of fuel.”

“The fully burdened cost of fuel is a recognition that there are a lot of other factors that come into play,” said Mark Iden, the deputy director of operations at the Defense Energy Support Center (DESC), which provides fuel and energy to all U.S. military services worldwide.

The DESC provides one gallon of JP8 fuel, which is used for both aircraft and ground vehicles, at a standard price of $2.78, said Iden.

The Commandant of the Marine Corps, Gen. James Conway, told a Navy Energy Forum this week that transporting fuel miles into Afghanistan and Iraq along risky and dangerous routes can raise the cost of a $1.04 gallon up to $400, according to Aviation Week which covered the forum.


The fully burdened cost of fuel accounts for the cost of transporting it to where it is needed, said Kevin Geiss, program director for energy security in the Office of the Assistant Secretary of the Army for Installations and Environment.

So merely stating that the fuel costs $400/gallon without explaining why is misleading. However, Roberts assessment that the USA is a "failed state" still has merit as he succinctly points out the nation's nonsensical fiscal priorities.

DED said...

And to think he served during the Reagan years. :)

Edwardo said...

Yes, the Reagan connection is something of a jaw dropper.

In truth, I think of the U.S. as, more properly, a nation well down the path to becoming a hollowed out state. Mexico is the classic failed state in the region, plagued by gangs of armed drug cartel thugs locked in a pitched battle with "state" police for nationwide control. And all that is happening while, and to some extent because, Mexico's biggest oil field, Cantarelle, is in steep terminal decline.

By my runes, the U.S is not nearly as far behind the plight of Mexico as one might imagine.

Government here in Freedom's Land has taken on a fascistic cast, (despite the enormous confusion of many that somehow the nation has become deeply Marxist-which is preposterous) and as such is losing legitimacy, albeit quietly, at home and abroad, almost on a daily basis. The nation's financial and fiscal condition is so parlous it is hard to imagine that the U.S. will avoid a currency dislocation before Obama's first and (likely) only term is up.

That will set the off the winds of chaos such that portions of the country will become rather disorderly and dangerous. Sorry to sound so dire, but I have a hard time seeing how we wiggle out of this one without pain the likes of which we have yet to barely imagine let alone experience.

Happy Halloween.

Thai said...

Nice post

"Sorry to sound so dire, but I have a hard time seeing how we wiggle out of this one without pain the likes of which we have yet to barely imagine let alone experience."

I hear you

How about this for outrage?

(And notice her vid? Indeed one sees the ever congealing threads of populism/fascism coming together throughout the blogosphere. One fascism to replace another?)

... Though fwiw I still think the pain of this mess will not be shared equally, nor will it actually be so very terrible for the average individual- it will however be horrifying for a few.

But it will be impossible to know who is in which camp until it all plays out.

Edwardo said...

Thai wrote:

"Though fwiw I still think the pain of this mess will not be shared equally, nor will it actually be so very terrible for the average individual- it will however be horrifying for a few."

But it will be impossible to know who is in which camp until it all plays out."

There are known knowns. These are things we know that we know. There are known unknowns. That is to say, there are things that we know we don't know. But there are also unknown unknowns. There are things we don't know we don't know.

Yours truly,

Donald Rumsfeld

Thai said...


Are you sure you are not going fractal on me? ;-)

Edwardo said...

I'm going something. It remains to be seen just what.

THD Russell said...

Guys, noticing decay and imminent doom is but one part of the equation. The second half is the solution. Of course that's easier said than done, but you go nowhere unless you try.

Edwardo, as you know (perhaps) I believe the path we need to explore is one which would lead to a resource-based economy. This is not something that can be switched on like a light, but must be slowly and carefully prepared for. It is a viable solution, that is, a falsifiable theory in its constituent parts, and therefore testable. There is too an organisation ( around which we should start to coalesce, so as to bring momentum to their proposals.

I imagine someone of your obvious (though dour) intelligence might find their website too "shiny happy people," but the underlying analysis of the current monetary system, the consequences of that analysis suggesting pursual of a RBE, is sound, regardless of the window-dressing and aesthetic of the site's design.

Why does there have to be no hope of any alternative? Why is it that even in the midst of collapse we all wring our hands and say "but this is the only system that works"? Do you really believe that nothing at all can follow on from this current system and improve on it? Is "human nature" so terribly fixed in its supposed greed and ambition that we are a species doomed to self-destruct due to poor wiring in the fires of our beginning? I think that's nonsense. Frustratingly though, I'm having a very hard time engaging people on this.

There, got that off my chest. Things are bad, yes, but lying back and moaning about it, no matter how eloquently, is just wanking (British English).

THD Russell said...


I was going to delete my previous post, but decided not to. A frustrating week sick at home, helping my eldest daughter with her homework, is as much an explanation for the emotion as anything else, yet I figure in the end the sentiments might be worth expressing.

I don't know any one here well enough to judge accurately how constructively you are addressing the situation in the world of finance and its wider aspect, so apologies for my aspersions. However, I figured letting my cat out of my bag might well yield some positive outcome. Hence this explanatory post.

Edwardo said...

No worries, THD. Your relatively mild fulminations are perfectly acceptable. BUT DON'T LET IT HAPPEN AGAIN! Just kidding.

I will investigate the venus project. No one has ever described me as dour before, but I do own up to the fact that my outlook, at least in this forum, isn't exactly bright and cheery. Some periods in history are (or seem) more promising than others, but when one is in the midst of one's own time it is often hard to tell what is in store.

On a more optimistic note, my view is that the next big breakthrough in human invention, (one of them anyway) and one holding profound implications for humanity's prospects and how we live, is now in its infancy.

I'll get to the point by offering it is related to Pons and Fleischmann's misnamed "cold fusion" experiments, which more and more scientists are discovering were not a hoax but genuinely worthwhile if flawed endeavors.

THD Russell said...

Thanks for the understanding response Edwardo, and excited to read your interest in cold fusion. If that were researched by humanity's best minds -- and I'm sure it's a solvable problem -- abundance would be a snap. Problem is, abundance is anathema to all monetary systems -- not to mention the resistance put up by the current energy cartel -- and yet is the cure for so much of what ails us...

The name's Toby, by the way, but if you get a kick out of THD, I kinda like it...

Weird of me. Must be the virus talking.

Thai said...

I do have to agree with Toby that you come off as a little dour. Indeed, if you are not as you say "in the real world", this comes as quite a surprise.

If you want to get into botched government programs, try reading about this whole H1N1 vaccine fiasco.

There is no level in the vaccination chain this thing has not been botched at.

Incompetency, or at least the total lack of cooperation skills, seems to be a universal trait.

I do not think the Bush administration would have gotten off this lightly on this issue- I will not blame the current one as I don't think any administration has as much control as we would like to think.

Just my 2 cents

Edwardo said...

I do have to agree with Toby that you come off as a little dour. Indeed, if you are not as you say "in the real world", this comes as quite a surprise.

What comes as quite a surprise? You've lost me, dude.

Edwardo said...

I've done a cursory scan of the venus project website, Toby, and I will be visiting it some more. I do have an issue or two with what I have read and seen so far-quelle surprise-and I wouldn't bring my concerns up-because I don't want to be churlish- except they seem valid, if not necessarily vital.

1.) Aesthetics.

Perhaps the future will have the, how do I put this, Epcot Center on steroids appearance displayed on the website. I felt the architectural schemes at the site, in the main, worked better in the undersea vignettes than on land. This is probably due to the fact that I imagine one wouldn't be spending all that much time marveling at such structures far below the ocean as all that sea water tends to make perambulating tricky and spoils the view.

Perhaps one is not meant to over invest in those renderings. Then again, why feature them so boldly, and in so many contexts, if they are not meant to be taken seriously. Well, the future does little or nothing if it doesn't define itself by its sharp departure from the past. In this futuristic case, I must admit I am not filled with eager anticipation of its arrival, at least not as regards architecture. To my dour eye, (can one have a dour eye?) there was nothing beautiful in those buildings/settings, just a kind of magnificent sterility. Someone else might find those land and/or seascapes highly nurturing of the human spirit, but not me.

2.) Money, the root of all evil!

The second issue I have with what I took to be the view of the venus project regards the role of "money". I think I understand the case they are making, and it has merit, but money really isn't the issue. Money, properly speaking, is nothing more (or less) than a medium of exchange. Some folks like to think of money as a "store of value", and in that context, the Venus Project's focus on the evils of money, insofar as I understand it, gains more traction for me.

I also think they are kidding themselves to some degree if they do not admit that their project has an ideological underpinning. There is nothing wrong with that, though the Venus Project seems inclined to stigmatize some of recent history's better known, if none too well loved, isms. In fact, by my reckoning, the Venus Project seems to have some considerable affinity with Marxism, which, doesn't necessarily have to be a deal breaker, though I can understand why they would go to some pains to distinguish their ideals from those of an ideology with, at best, a controversial reputation, and, at worst, one that is wholly reviled.

THD Russell said...

Hi Edwardo,

sadly I'm still feeling like shit, so am not firing on all cylinders here.

(I regret the "dour" observation!)

I disagree with the way The Venus Project projects itself. They laud science above all things, yet their presentational approach suggests endless blue skies, endlessly perfect weather and white buildings as far as the eye can see, and there's nary an equation in sight. I happen to like some of the buildings, but feel this is a complete irrelevance. Why they have concentrated so much energy on one guy's architectural design-taste is beyond me. The only clue as to why is that Mr Fresco believes arguing only works with a very small percentage of the public. Making an argument takes ages, and The Venus Project's proposals are so contrary to the way the world currently works, you needs books and books to prove your case. Most people don't read. So they pitch via pictures, and hope to gain "sufficient" support for forward momentum. Should it ever come to actually designing a city, Mr Fresco would not be in total control. How could he be? The man is 93 years old and all about inclusivity. All would be free to design and choose designs to their liking. Don't (please) be dissuaded by "the look."

Money is not the root of all evil, it IS just a medium of exchange, and was a great, if not amazing tool for civilizational development. Just not any more. That, in a nutshell, is TVPs take. Money's logical and unbreakable bond with scarcity, divisions, and competition is harming now more than helping. Money got us this far, so to speak, now it has to be demoted, perhaps to the point of non-existence. Time will tell.

Yes, a resource-based economy smacks of communism, except that it has nothing to do with class struggle, seeks the extinction of politicians and political parties, and of course money. Marx saw class struggle defining the arc of human development. The RBE thesis sees a conflict between scarcity and technology, tech that would deliver abundance if it were allowed to. Contrary to intuitive expectations, the RBE idea predicts that abundance would encourage cooperative and "ungreedy" behaviours, whereas scarcity does the exact opposite. The other part of the thesis is that human labour is being rendered unnecessary by our ever improving technological prowess, a point orthodox economics, sadly, just yawns at. I suspect economists don't know what we are now capable of, in terms of AI and cybernation. I suspect technology, which is nothing more than human ingenuity made real, and therefore includes language itself, is, at least in terms of its potential, misunderstood by economists generally.

Thanks for engaging and being open on this. I sulked, you appeased. It's almost romantic.

You are not dour.