Recovery, or "Obama Bubble"?

For some reason, the war in Afghanistan that Bush, the Congress, the American public, and NATO launched back in 2002 is now referred to as Obama's War!  How bizarre is that!!!  All because Candidate Obama kept referring to the Afghanistan War as the "war of necessity" ....

Anyway, that moniker has stuck.  No wonder then that Sean Collins refers to the jobless recovery as Obama bubble.  He writes:

unless the underlying conditions for investment are restored, government money is likely just to pump up further the re-emerging bubbles. Even if the Obama administration recognises this trend, it is likely that lacklustre economic growth and high unemployment will render them reluctant to tighten monetary and fiscal conditions too much.
The unspoken issue at the root of Obama’s dilemma is that the economy’s engine – private non-financial industry - is not investing and innovating. And his response so far is part of the problem, not the solution.

Why does he say so? Because:

the latest rise in the stock market is more of an indication that the finance bubble is returning rather than a harbinger of broader economic recovery. And rather than blame greedy Wall Street types for starting the party before others have arrived, this reinflated bubble has been made in Washington, DC – led by liberal Democrats in the Obama administration, who many Wall Street critics praise for saving the economy from another Great Depression.

Christopher Hitchens kicks up dust down under

I am not referring to his essay on Sydney's dust storms, but the following discussion:

The two Americas: the unemployed, and the rest :-(

ht

Jobless recovery: can the economy stand on its feet?

John Cassidy wonderfully and succinctly summarizes the recession and recovery, and notes:

With short-term interest rates at or close to zero, the government running a record deficit, and taxpayers propping up the housing market and the financial system, it is hardly surprising that the economy is growing again. Even a terminally ill patient often responds positively to aggressive medication, for a while. The big test will come when the government starts to remove the meds. Come the new year, the Fed will be eyeing higher interest rates, and it will also be shutting down some of its generous lending programs. The administration, meanwhile, will be talking about fiscal consolidation. Can the economy stand on its own two feet?

That is, indeed, the gazillion dollar question :-(
Already there is talk of continuing with the first time home buyer tax credit, which otherwise would end next month.  Is that a reflection of the thinking that the economy isn't quite ready to stand on its feet?

The New Yorker Magazine's Oct 26th issue

I might have gotten the full value of the subscription (a gift from my daughter) from this issue alone.  Jane Mayer's detailed notes on the various aspects of using the Predator drones in Pakistan is a must read for every single citizen.  Everything Mayer has to say is important.  One of the questions that she raises that continues to bug me is this: it is one thing to use those drones in Afghanistan, where we are waging a war.  But, when we use it, particularly via the CIA, in Pakistan, isn't that extra-judicial killing by the state, which is something that the US has explicitly forbidden?  A very informative but troubling essay.

The essay on the nasty fires in Melbourne earlier this year is a gripping story.  Had me sit up in my bed as I started reading it.  I recall following it, particularly because my brother and his family live in that city--though they were too much within the city to be affected by the fires. 

And, oh yeah, there is also a piece on James "I'm the king of the world" Cameron and his soon to be released "Avatar." 

Quote of the day (Fukuyama)

You simply can't get good governance without democratic accountability. It is a risky illusion to believe otherwise

Read the interview with Fukuyama. (ht)

Happy birthday, United Nations

The United Nations, which was established in 1945, will celebrate its birthday on October 24^th.  A reconfiguration, not retirement, is in order for this 64-year old--to reflect the passage of time and a contemporary world that is far different from 1945. 

Reflexive ruminations about the UN, particularly since September 11, 2001, always seem to be with respect to the crises in the Middle East and Afghanistan.  War and peace were certainly the catalysts for the creation of the organization.  In fact, even the preamble of UN’s charter clearly states the determination of the signatories “to save succeeding generations from the scourge of war, which twice in our lifetime has brought untold sorrow to mankind.” 

But, of course, when it comes to preventing wars, the UN’s track record is not unblemished.  Furthermore, the first forty-four years of the UN were against the background of the Cold War, and the intense political differences between the United States and the USSR always loomed large over the UN’s businesses. 

Unfortunately, the bright spotlight on the UN’s involvement in peacemaking amidst wars has pushed many other activities of the UN, most of which are nearly irreplaceable, into a media darkness. 

Consider the UN’s High Commission on Refugees (UNHCR.)  Because of wars and famines there are displaced people scattered all over the world, and the UNHCR has an immense task of coordinating relief efforts.  For instance, estimates are that more than four million Iraqis have left their homes in the six years of military engagement there, and the UNHCR assists about a fifth of them.  According to the UNHCR, a staff of about 6,600 oversee the work done in more than a 100 countries, and about 80 percent of the staff are in the field—far away from the headquarters in Geneva. 

Equally important—perhaps even more important than the UNHCR—is the UN’s World Food Program (WFP.)  I am immensely thankful that I have never had to suffer the misfortune of not having food, and every once in a while I do cringe when I exaggerate my hunger with a statement such as “I am starving.”  But, that is not the case worldwide for more than a billion people who are chronically undernourished.  Even with its severely limited resources, the WFP not only works to save lives during emergencies, it also systematically works on strengthening the capacities of countries to reduce hunger. 

These two examples easily show that there is a lot more to the UN than the regular spectacle of grandstanding speeches at the General Assembly, especially from dictators, and the relatively ineffective deliberations and resolutions at the Security Council. 

But, the UN certainly does not seem to be in any hurry to address this huge image issue.  If at all, reports such as the UN's chief envoy not acting on evidence of vote rigging in the yet to be concluded presidential elections in Afghanistan further diminish the agency’s credibility as an international broker of peace. 

However, it is clear that the UN does not have the luxury of being in denial about its increasingly marginalized status.  There is one tangible and compelling reason, more than anything else, for restructuring the UN—budgets.  The reality is that the UN’s finances have not been in the best possible shape for more than a decade, and can be expected to worsen as member countries struggle through the global recession.

If a crisis is a terrible thing to waste, then there is no better time than the current Great Recession for the United Nations to initiate changes.  Learning a few lessons from multinational corporations that seem to be rapidly falling like unstable dominoes, the UN, too, can restructure its operations in order to improve its efficiency and effectiveness.  

Of course, reforming the UN is not entirely a new idea.  The latest effort was initiated by the current Secretary-General, Ban Ki-Moon soon after he took over the office.  I hope that the reform initiatives pay dividends soon because the problems humans face are increasingly global, and an effective United Nations could help mitigate them. 

For now, happy birthday, United Nations!

Saving the public universities

Public universities have been forced to raise tuition largely because state governments, facing huge budget shortfalls, have reduced spending on higher education. But many education experts said colleges must do a better job of cutting costs.
“Colleges need to be looking for ways to permanently restructure, not just cut their budgets,” said Jane Wellman, executive director of the Delta Project on Postsecondary Costs, Productivity and Accountability. “A perfect example is furloughs, in hopes that eventually the work force can come back. But this isn’t a one-time problem, and eventually they’ll have to bite the bullet and reduce their work force.”

Read the entire NY Times story

I get knocked down ....

But I get up again ....

Richard Dawkins' next book

"Dear Juliet," ... "Now that you are ten, I want to write to you about something that is important to me. Have you ever wondered how we know the things that we know? How do we know, for instance, that the stars, which look like tiny pinpricks in the sky, are really huge balls of fire like the sun and are really far away? And how do we know that Earth is a smaller ball whirling round one of those stars, the sun? The answer to these questions is 'evidence.' "

Apparently that is how Richard Dawkins' next book begins.  It "will be for 12-year-olds, an expansion on a letter about the importance of critical thinking that he wrote to his daughter, Juliet, now a medical student, when she was 10."
Should be great.  Am reminded of the book Sophie's World--I bought that for my daughter when she was in her mid-teens.  Am not sure whether she read that; I did :-)

AfPak high on opium

"The Afghanistan/Pakistan border region has turned into the world's largest free-trade zone in anything and everything that is illicit - drugs of course, but also weapons, bomb-making equipment, chemical precursors, drug money, even people and migrants," 

That is from the head of UN Office on Drugs and Crime (UNODC) who is concerned about opium from Afghanistan and how it generates a whole bunch of problems for the rest of the world too.

UN findings say an opium market worth $65bn (£39bn) funds global terrorism, caters to 15 million addicts, and kills 100,000 people every year.
The UN says corruption, lawlessness and uncontrolled borders result in only 2% of Afghan opiates being seized locally.
The UN says more Russians die annually from Afghan drugs than Soviet soldiers were killed during its Afghan conflict.
Afghanistan produces 92% of the world's opium, with the equivalent of 3,500 tonnes leaving the country each year.

The US fights wars over one of three: oil, drugs, terrorism. Here in AfPak, we have two out of three.

China surging at 8.5%

When Fareed Zakaria writes or says anything in a public forum, he does not give me anything to disagree with.  Maybe because we are both from India?  Ha ha.  His latest piece, on China, makes sense:

China entered the crisis in an entirely different position. It was running a budget surplus and had been raising interest rates to tamp down excessive growth. Its banks had been reining in consumer spending and excessive credit. So when the crisis hit, the Chinese government could adopt textbook policies to jump-start growth. It could lower interest rates, raise government spending, ease up on credit, and encourage consumers to start spending. Having been disciplined during the fat years, Beijing could now ease up during the lean ones.

And look at the nature of China's stimulus. Most of U.S. government spending is directed at consumption—in the form of subsidies, wages, health benefits, etc. The bulk of China's stimulus is going toward investment for future growth: infrastructure and new technologies. Having built 21st-century infrastructure for its first-tier cities in the last decade, Beijing will now build similar facilities for the second tier.

This to me is not a big deal.  After all, the Chinese economy has a lot to catch up with the US.  But, the following ought to make American politicians think twice about what they are up to, particularly the likes of those who want to yell "you lie!":

China is also well aware of its dependence on imported oil and is acting in surprisingly farsighted ways. It now spends more on solar, wind, and battery technology than the United States does. Research by the investment bank Lazard Freres shows that of the top 10 companies (by market capitalization) in these three fields, four are Chinese. (Only three are American.)

The only thing to watch out for, says this FT blog post:

Worries that China is in the grip of a real estate bubble intensified after a five-bedroom apartment in Hong Kong was sold for $56.6m this week. Andy Xie, a Shanghai based economist, argues that China is probably the most bubble-prone economy in modern times - and may be just ten years away from its final day of reckoning.

The joys of a monotonous life

Only yesterday it was that I commented to a friend that life is about the routine stuff.  And then I read this today (ht):

In its essence life is monotonous. Happiness therefore depends on a reasonably thorough adaptation to life’s monotony. By making ourselves monotonous, we make ourselves equal to life. Thus we live to the full. And living to the full is to be happy.

Unhealthy, illogical souls laugh—uneasily, deep down—at bourgeois happiness, at the monotonous life of the bourgeois man who obeys a daily routine . . . . . . , and at his wife who spends her time keeping the house tidy, is consumed by the minutiae of caring for the children, and talks about neighbors and acquaintances. That’s what happiness is, however. It seems, at first glance, that new things are what give pleasure to the mind; but there aren’t many new things, and each one is new only once. Our sensibility, furthermore, is limited, and it doesn’t vibrate indefinitely. Too many new things will eventually get tiresome, since our sensibility can’t keep up with all the stimulations it receives.

To resign oneself to monotony is to experience everything as forever new. The bourgeois’s vision of life is the scientific vision, since everything is indeed always new, and before this day this day never existed.

He, of course, would say none of this. Were he capable of saying it, he wouldn’t be capable of being happy. My observations only make him smile; and it’s his smile that brings me, in all their detail, the considerations I’m writing down, for future generations to ponder.

These are the translated words of Fernando Pessoa.  I had never heard of him until today--shows me, yet again, how little I know about this universe.  In fact, it is even ridiculous to think I know anything at all about this universe!

Why I love muddled and messy politics

Because often I think that is the only true sign of a democracy.

Growing up in India, particularly coming of age when Indira Gandhi imposed a federal emergency rule on the entire country, and the later confusion with the Janata Party, was a fantastic immersion experience of sorts in understanding politics and civics.  And through those teenage years, I used to wonder whether the emergency was better--everything was a lot more efficient, and there was certainly lesser chaos.  But, as I started understanding the dark sides to it, the more I preferred the chaos and inefficiencies.

So, I could completely resonate with the following comments by Ian Buruma, whose blog entry is in the context of the recent Japanese elections:

The victory of Hatoyama’s Democratic Party of Japan has demolished this myth. Japanese no longer felt that their country’s destiny (and economic crisis) was best handled by bureaucrats and ineffectual politicians, who could think of little more than to pour more tainted money into useless bridges, unwanted dams, and roads going nowhere. They wanted more choices. They want to be properly represented. They wanted to feel that their votes actually counted.

The Democratic Party has promised to change the system, to put elected politicians in charge, instead of bureaucrats. This will not be easy. Vested interests in technocracy are strong. But even if the promised reforms don’t happen overnight, or under Hatoyama’s watch, things will not be the same again. Now that Japanese citizens have finally exercised their power to vote the rascals out, going back to the old ways is no longer an option even for conservatives.

This is good news for Japan. And it is good news for the rest of us, especially at a time of low confidence in democratic institutions. The temptation, in periods of crisis, to do away with messy politics and put the experts (or the great leaders) in charge, is getting stronger: look at Italy, or Thailand, or Russia, or Venezuela. The Japanese have chosen the more democratic route. Three cheers to them.

Yes, three cheers to them, and to democracy.

The Baluchs in Iran and Pakistan

Back in June, my column in the Register Guard was about the Sunni and Baloch minority in Iran.  I pointed out there that the Balochs are a minority in both Iran and its neighboring Pakistan, and:

Third, and most important, a group called Jundallah claimed responsibility for this blast. Jundallah, which means “soldiers of Allah,” has gained strength in the post-Sept. 11 years. Jundallah claims to be fighting the Iranian government to secure equal rights for the Sunni and the Baloch people.

Well, I wake up this morning to NPRs news that Jundallah carried out a suicide bombing attack that killed several commanders of the Iran's Revolutionary Guard.  Here is the BBC:

Iranian state television said 31 people died in the attack, in the Pishin region of Sistan-Baluchistan, and more than 25 were injured. ... The deputy commander of the Guards' ground force, General Noor Ali Shooshtari, and the Guards' chief provincial commander, Rajab Ali Mohammadzadeh, were among at least six officers killed, state news agency reported.

Morbid update

A round up of some of the deaths that made the news:

• As of Saturday, Oct. 17, 2009, at least 796 members of the U.S. military had died in Afghanistan, Pakistan and Uzbekistan as a result of the U.S. invasion of Afghanistan in late 2001
• Nine die in attacks across Iraq
• Fireworks blaze kills 32 in India
  
• Three soldiers, 25 Taliban dead in Afghanistan
• 12 dead in gang battle in Rio, which will host the Olympics?

I think this is enough for now :-(