Archive for July, 2010

Driving Nowhere

Tuesday, July 27th, 2010

A $40,000 hybrid electric car with a range of 350 miles, a gas engine requiring premium fuel, and why nobody’s laughing out loud is hard to fathom…

Electric cars don’t make any sense at all right now. They’re too expensive to build and they aren’t easily recharged. At a time when gas is very cheap, they simply aren’t competitive in any way.

A better fix would be to raise the gas tax by $5/gallon, eliminate the tax breaks for electric cars, and see if some creativity on the part of an under-investing private sector might wean us off fossil fuels for good.

Take a look at the Prius, everyone’s hybrid darling. It costs 50% more than a manual transmission Toyota Corolla and gets 25% better gas mileage. The break even point is 12 years. How many Americans own their cars for 12 years?

Gorilla says: “While we’re firing teachers, and misplacing $9 billion in Iraq, it would be nice if the government did something sensible and got out of the car business!!!”

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Extend And Pretend Pesto

Tuesday, July 27th, 2010

In Basel, guess what?, capital requirements and timeframes for European banks have been watered down!!!

Quelle surprise!!!

And the big winners are the French and Nordic banks, who get another 8 years to let the rest of the world know they’re solvent!

It’s another example of why “financial reform” has become a meaningless phrase.

Like criminals, banks will always go to countries and regulators that give them the best free ride.

In the US, the free ride depends more or less on capturing and/or shopping around for regulators.

In Euroland, it’s all about hiding away your problems and/or creating stress free stress tests you know your banks will ace.

Gorilla says: “Warm up the printing press and get ready for the next banking crisis!”

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Right Idea, Wrong Advocate

Tuesday, July 27th, 2010

Of course Turkey should be given membership of the EU, but having the new British Prime Minister as an advocate won’t get the job done…

The British themselves are sorta members of the EU.

Military and foreign policy unity? Sure!

A single currency and bailouts for German and French banks? Not so much!

The problem for the Turks at the moment is twofold: a) they’ve got a government that’s much more favorably disposed to the Islamists in the country and b) the French don’t think a largely Islamic country makes any sense as an EU member (see: burqa bans, restrictions on immigration, Sarkozy’s inflammatory election year rhetoric, etc.).

Gorilla says: “It’s not the messaging, it’s the messenger!”

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One Duch In A Row

Monday, July 26th, 2010

Cambodia’s first serious genocide trial has resulted in the Khmer Rouge’s prison chief, one Kaing Guek Eav aka Duch, being sentenced to 35 years in prison for crimes against humanity.

There are another 4 trials to go. Many in Cambodia were not happy that the judge reduced Duch’s sentence to 18 years based on his pre-trial detention, but it’s a start on the way to assigning some accountability for the worst genocide of the past 40 years.

Gorilla says: “Now if we could only ship our own war criminals to the Hague, starting with Cheney and Rumsfeld, accountability might really mean something!”

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Third World Infrastructure

Monday, July 26th, 2010

In Iowa, say goodbye to Lake Delhi, which disappeared over the weekend after a 92 year old dam collapsed.

Every day, in every newspaper in the US, there is a story about some element of our collapsing, Third World infrastructure: bridges, dams, water and sewer pipes, highways, you name the problem, and the likelihood is it was built 30 or more years ago and never properly maintained.

So why can’t we have a trillion or so spent on fixing what are obviously shovel ready projects that might hire a few million unemployed Americans?

Because, as our idiot Treasury Secretary observed yesterday, “We need to make that transition now to a recovery led by private investment.”

But there’s no demand and vast amounts of oversupply, all provided by the private sector, in industries like housing, commercial real estate, autos, etc. etc. etc.

Infrastructure, on the other hand, isn’t sexy, costs a lot of money the states and localities don’t have, and doesn’t come with a visible plaque for the local Congressman (“better shit distribution, thanks to me!”), so the private sector keeps hoarding cash, political leaders say their hands are tied, and the unemployed keep getting screwed.

Gorilla says: “Maybe those Asian Keynesians will adopt us!”

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Quote Of The Day

Monday, July 26th, 2010

Laurence Kotlikoff, professor of economics at Boston University, on the new “financial reform” legislation: “This law is like being invited to dinner and served pictures of food”.

Gorilla interprets: “When faced with a choice between accountability and illusion, our leaders will choose illusion every time!”

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Having It Both Ways

Monday, July 26th, 2010

It goes something like this: National security today is threatened by leaks about 2004-09, but fortunately we’ve changed our approach since then…

The reality of course is that we’re losing the war in Afghanistan, the Pakistanis cannot be trusted, and there’s no exit strategy.

No one in the Administration likes to hear this, but it is their refusal to face reality that keeps America stuck in two pointless, unwinnable wars.

Gorilla says: “When you’re drowning in quicksand of your own making, it doesn’t do much good to pretend you aren’t sinking!”

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Shorter Guardian

Sunday, July 25th, 2010

Gorilla asks: “And the news would be?”

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What’s The Navy Doing In Logar?

Sunday, July 25th, 2010

A landlocked country, a drive into an insurgent zone, a death and a capture

Were they Seals, on their way to a bit of covert disruption? Or two more in the wrong place at the wrong time?

Hopefully, the survivor will not be tortured, but of course you can’t count on that when our track record is so repugnant…

Gorilla says: “Another day in Afghanistan, fighting and winning nothing…”

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Nuclear War This Weekend?

Saturday, July 24th, 2010

North Korea isn’t too happy about South Korean-American military exercises this weekend, and threatens to use its “nuclear deterrent” if they go forward…

Putting aside whether this threat is genuine (the guess here is that it’s not), the problem with North Korea is that it’s only a threat to South Korea, and nobody’s going to war over that.

So what’s the point of all these military pr exercises?

To demonstrate we’re serious about something, although it’s not clear what.

To show the Chinese we mean business, although they’ve correctly concluded our bilateral relationship is far more important than anything we say or do about fifth-rate regional irritants.

To put the brakes on anyone in Washington getting too zealous about cutting the defense budget, presumably we need all those ships and planes to defend ourselves against the collective might of North Korea, Iran, and the Taliban.

Once the sabers have stopped rattling, we’ll again confront the same issue: do we or do we not wish to engage in serious, bilateral diplomacy with these very minor rogue states and insurgency movements?

In Afghanistan, we clearly want a deal with the Taliban, but can’t be seen to be negotiating. So we allow Karzai to make sympathetic outreach noises and the UN to undertake very drawn out talks with the principals.

In Iran, we can’t be seen to be negotiating directly because that won’t play well on the local news in an election year. So it’s another round of sanctions and lots of huffing and puffing.

In North Korea, we could negotiate directly, but we also want to play the Chinese off against our Asian allies for some as yet undetermined benefit (aka “the Jack Spratleys strategem”).

Gorilla says: “Pretending to care is always easier than pretending to dare!”

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