Politics, Economics and other Stuff

Afghan Army to go from 85,000 to about 270,000

The WP reports

McChrystal has not yet completed a 60-day assessment of the war due next month. But Defense Department officials in Washington and in Kabul said he has informed Defense Secretary Robert M. Gates, including in a status update this week, of the need to increase the Afghan force substantially. Officials spoke on condition of anonymity in order to discuss findings that have not yet been made public.

The Afghan army is already scheduled to grow from 85,000 to 134,000, an expansion originally expected to take five years but now fast-tracked for completion by 2011. Several senior Pentagon officials indicated that an adequate size for the Afghan force might be twice the expanded number. ...

But Jones and others acknowledged that both reconstruction and competent governance cannot be achieved until the Afghan people are secure. The strategy calls for U.S. and Afghan forces to clear areas of the Taliban and then hold them. Commanders leading a Marine operation launched last week to drive Taliban forces from Helmand Province in southern Afghanistan are already asking, "Where are the Afghan troops? Where's the economic plan? Where is the government?" Jones said....

Joint Chiefs of Staff Chairman Adm. Michael Mullen told reporters Wednesday that the White House and the Pentagon are "committed to properly resourcing this endeavor."

A 270,000 army isn't large for a 32 mil. population country with a security problem.  European countries can put about that many military personnel in the field for the same population, and that is after decades of peace.  For instance, Poland has a bit over 100,000 active duty military personnel, up to 340,000 once reserves are called up, with a population of 38 million.  Germany with a population of 82 million has fully mobilized military personnel of around 600,000, again the same magnitude.  Both not high military intensity societies. 

Somewhat surprising/shocking that it took so long to build up force levels in Afghanistan given the conflict, especially since it does not seem to reflect a deliberate choice to build up forces slowly and financing Afghan personnel ought to be relatively cheap. 

I know, lots of second order problems here. I'd not be surprised if we end up with force levels at 500,000 or more in 2016. This would not at all be out of line with historical experience for peasant societies in conflict situations. Hell, Serbia, very much a peasant society with a population under 5 million, could put 500,000 men in the field at the start of WWI. 

The German Economy

The IMF projects Germany as the worst performing large economy in 2009 and 2010, with GDP down 4.6% and then flat, in its world economic outlook update released a day ago.  The IMF sees a GDP decline of 1.4% for the US in 2009, followed by 1.7% growth in 2010. Including performance in 2008, this amount to a 5.9% cumulative growth differential of the US over Germany from 2008 to 2010. 

Do remember the large (>1%) difference in labor force growth rates between the two countries.  Still, not enough to account for such a large growth differential. 

Partly this is Germany as a large capital goods exporter.  Anything else?  

Gender Gap in Undemployment Rates

via Clusterstock.  This looks like it might have an interesting story behind it, since it doesn't seem all that stationary, or rather stationary with occasional breaks.  Two big breaks there, 1979-83 and now, with smaller surges during other recessions that then reverted. 

Chart is male unemployment rate minus female unemployment rate. 

1/3 of Massachusetts Drivers don't wear Seat Belts

One third of Massachusetts drivers don't wear seat  belts, making Massachusetts the Mississippi of seat belt use.  No explanation in the article for the origin of this anomalous rank of Massachusetts in this issue area, though from personal experience it seems to me that the problem seems to go quite far back with a lack of helpful state legislative action.  But why Massachusetts and not, for instance, Alabama or South Carolina?  What am I missing here? 

I need to find the data, maybe none of the state data are significantly apart or much more than measurement error. 

Ah, here is the state data, but without error bars.  California is the best performing state, with seat belt use well into the 90+% range for many years, with Washington state catching up to this level recently.  Even Texas is now above 90%.  Massachusetts is a longstanding outlier on the low side, the only other entity that does this badly is American Samoa.  Admittedly, Wyoming is only slightly better than Massachusetts, with seat belt use in the high 60%.   These are clearly significant differences, not just noise. 

The weird thing is that the West has the highest seat belt use and the Northeast the lowest, despite seat belt use being much higher in urban areas than rural areas, and much higher in cars that trucks.  So Wyoming being the second worst state for seat belt use makes sense.  But Massachusetts?  (data) Seat belt use by blacks and hispanics also appears to be lower than for non-hispanic whites, which again doesn't explain Massachusetts relative to the deep South or Texas and California. 

I know, there is the notion that this is a sort of passive aggressive displacement of the lack of gun rights in Massachusetts onto 'if you don't let me carry hand guns at least I have the right to kill myself in a car accident', but that only explains the lack of the lack of a seat belt law in MA, not the low seat belt use.  Though people may be mistakenly learning from their right not the wear seat belts that it is not in their interest to wear seat belt.   And by now certain parts of the Massachusetts culture have dug in on this issue and made it part of their identity.  The interesting thing is that this occurs at the state level, not a regional or more local level.  All very disconcerting for standard economic modeling approaches. 

Random Nature Photos

From the lens and camera that I dropped today. The seagull is a bit off focus, but I don't think that is a camera problem, just a faraway -- this is a crop of the original photo -- seagull moving fast. The usual caveat that the monitor I'm using while on vacation isn't the best and makes detail, especially color and contrast, hard to see...

Camera Drop

Well, I dropped my camera today, slipped off the bed on which I put it.  Two feet or so on a wood floor.  Seems fine as far as I can tell.  But I am paranoid.  It did have the sturdy 70-200mm L lens on it with a lens hood, so the right lens to drop it with, and it most likely hit with the camera body. 

Not the first or last camera to hit the floor. 

Update #1: well,the 70-200mm lens now has a slight back focus issue.  But that may just be what this lens always did on this body...hard to tell without being able to look at old photos of focus charts. I also don't regard a slight back focus as a problem. Finally, my test shots today were with the CP filter, so it may just be a slight filter effect (or not). 

Paintball

The kids found several dozen paintballs on the beach down the road. 

Hiring the employed vs. the unemployed

The WSJ reports on firms that only hire the employed away from other firms and shun unemployed job seekers.  Lots of interesting sociology and economic in this topic and it would be nice to know more, for instance how this preference changes over time. 

With unemployment at 9.4% and rising, it’s a buyer’s market for employers that are hiring. But many employers are bypassing the jobless to target those still working, reasoning that these survivors are the top performers.

“If they’re employed in today’s economy, they have to be first string,” says Ryan Ross, a partner with Kaye/Bassman International Corp., an executive recruiting firm in Dallas. Mr. Ross says more clients recently have indicated that they would prefer to fill positions with “passive candidates” who are working elsewhere and not actively seeking a job.

The bias extends from front-line workers to senior managers. Charlie Wilgus, managing partner of executive search for Lucas Group, based in Atlanta, says a manufacturing client looking for a division president recently refused to consider a former divisional president at Newell Rubbermaid Inc. whose department had been eliminated. The client doesn’t want candidates who have been laid off, Mr. Wilgus says.  ....

Even when employers are successful, recruiting the employed can cost money. Tim Donohue, senior account manager of Infinity Consulting Solutions, an executive-search firm specializing in finance-related industries, based in New York, says candidates who are wooed away from other jobs typically demand a higher salary than the unemployed, who tend to be more open to negotiation.

Nonetheless, many employers consider the employed more valuable and worth the extra effort. Health-care management-consulting firm Beacon Partners Inc., Weymouth, Mass., has openings for 10 technology-consulting and senior project-management positions. Chief Executive Ralph Fargnoli is looking first for people who are still working. “If they’re still employed that means they have some significant value,” Mr. Fargnoli says. ...

When employers post jobs, they often are flooded with applicants, many of whom aren’t good matches for the position. Kristi Robinson, vice president of talent acquisition at Express Scripts Inc., says applications at the St. Louis pharmacy-benefit manager are up 80% from last year, but many candidates are either over- or underqualified. By targeting people who are currently employed in comparable positions, the firm can bypass candidates who aren’t perfect matches.

Risks of High Wealth

via Zero Hedge, I see the news that

Jean-Pierre Aguilar, co-founder and CEO of France’s largest hedge fund, died in a gliding accident over the weekend.

Capital Fund Management, which Aguilar helped set up 18 years ago, broke the tragic news to its investors in a letter yesterday. Aguilar, a passionate glider, was killed during a flying contest in the south of France sponsored by CFM. The accident occurred during the final flight of the six-day event, and also took the life of his co-pilot, the head of the Gliding Club of Barcelonnette, France.

Aguilar died “while competing in a sport he loved and where he had tremendous experience,” CFM told investors. The 49-year-old is survived by a wife and three children.

CFM moved to quickly to reassure investors that the US$2.7 billion firm would survive its leader’s untimely death.

A Seperate Peace with China?

The NYT writes:

The United States, long a laggard in international efforts to reduce global warming pollution, will arrive at the meeting of the world’s major powers in Italy this week carrying a newly assertive message on the dangers of climate change and the steps needed to address it.

The European hosts of the Group of 8 summit meeting welcome the shift. But the new stance also worries them, in part because they fear that the United States is working toward an independent deal with China outside the global negotiating framework....

The president and other American policy makers also insist that no deal can effectively reduce emissions unless China, India and other major developing countries are on board. The United States has been pursuing a separate track of climate diplomacy directly with Beijing.

Michael Starbaek Christensen, a senior climate-change official in Denmark, said he was worried that the United States and China — the two largest emitters of greenhouse gases in the world — would cut a separate deal and push the rest of the world into a treaty that did too little to curb emissions.

“I can only encourage Europe to stay in the lead and not let a bilateral U.S.-China relationship take over,” Mr. Christensen said, “because one concern I would have with the U.S.-China relationship is that they would find a lower common denominator.”

Discussions between China and the United States have progressed, but the countries remain far apart on emissions targets, trade measures, technology transfer and payments from rich countries aimed at helping developing nations adapt to the anticipated effects of rising temperatures, surging seas and the clearing of forests. There appears little prospect for resolution of those differences before December.

Sorry, I don't yet see how to make sense of these claims, except maybe that the US and China may have sufficiently overlapping interests and positions in the global economy and polity to form a joint negotiating stance vs. the rest of the world, including the EU, and that doing so would raise US/China's power significantly, forcing more adjustment on the EU.  But one would have to outline why this is a bad thing.  Having a good model of this process, something I've considered working on since it doesn't seem to exist, would be nice. 

Job Losses in Germany

Since the US has lost about 4.6% of its employment since the peak employment number in Dec. 2007, I looked up the comparable figure for Germany.  So far, German employment is off around 0.6% from its peak in October 2008.  Not the same sort of experience yet and pretty astounding given the slightly larger fall in GDP in Germany than in the US. So far German employment looks not much more exciting than in the 2002/2003 recession, where employment fell 1.7% after 16 months, with a fall of 1.2% in nine months (i.e. a bigger fall than the current 0.6% fall after seven months). 

Net Job Losses so far

Last week's news, but here, via. CR, are net job losses in all post-WWII recessions.  Why are more recent gross employment figures smoother?  Is this just a larger sample size or is there less noise in the underlying data (say due to smaller seasonal effects misses by seasonal adjustments or higher adjustment costs for employee numbers)? 

Backyard owl

A great horned owl high up on a tree in the backyard today.  See also the backyard owl at our house back in 2007.  

What's Richard Gephardt doing in 2009?

The Plank writes:

In Washington, you can spend decades as bitter ideological opponents but still find common cause in the name of cashing in:

The nation's largest insurers, hospitals and medical groups have hired more than 350 former government staff members and retired members of Congress in hopes of influencing their old bosses and colleagues, according to an analysis of lobbying disclosures and other records.

The tactic is so widespread that three of every four major health-care firms have at least one former insider on their lobbying payrolls, according to The Washington Post's analysis.

Nearly half of the insiders previously worked for the key committees and lawmakers, including Sens. Max Baucus (D-Mont.) and Charles E. Grassley (R-Iowa), debating whether to adopt a public insurance option opposed by major industry groups. At least 10 others have been members of Congress, such as former House majority leaders Richard K. Armey (R-Tex.) and Richard A. Gephardt (D-Mo.), both of whom represent a New Jersey pharmaceutical firm. [emphasis added]

Here's Gephardt in 2002, railing against the "drug companies" behind the House GOP's Medicare prescription drug bill: "It's a total capitulation to special interests!" Much like Gephardt's post-Congressional career.

It seems Armey and Gephardt have been working together for a while as team, also including at time George Mitchell,  Howard Baker, Tom Daschle and Bob Dole.

What drives moral concerns

This from Cheap Talk seems about right:

I enjoyed this article in the Boston Globe which surveys a variety of theories for the (mostly anectodal) tendency for the most vocal moralizers to be the most prone to vice.  When you read an article like this you have to start with simple null hypothesis that, other things equal, making a person more concerned about moral behavior will make them inclined to act morally.  Many of the stories in this article are tempting, mostly because we want to hate hypocrites, but ultimately don’t put up a good counterargument to this benchmark view.  However the following excerpt is more subtle and in my opinion the most robust story offered.

When asked about the phenomenon of the hypocritical moralizer, psychologists will often point to “projection,” an idea inherited from Freud. What it means – and there is a large literature to back it up – is that if someone is fixated on a particular worry or goal, they assume that everyone else is driven by that same worry or goal. Someone who covets his neighbor’s wife, in other words, would tend, rightly or wrongly, to see wife-coveting as a widespread phenomenon, and if that person were a politician or preacher, he might spend a lot of his time spreading the word about the dangers of adultery.

Not that this is the only thing going on. 

Trusting Mortgage Brokers

Mark J. Garmaise, After the Honeymoon: Relationship Dynamics Between Mortgage Brokers and Banks

This paper provides new micro-level evidence describing how the dynamics of mortgage broker-bank relationships contributed to the current residential loan crisis. In a theoretical analysis, I demonstrate that brokers have an incentive to present mortgages to the bank that are of decreasing quality over time. Empirically, I find strong evidence of this behavior in the data; I show that 22% of the delinquencies in my data are attributable to the increasing unobservable risk of mortgages originated by a given broker over the course of his relationship with a bank, controlling for month-of-origination vintage effects.

Improved Weather

No time to post.  Goats move too fast towards the camera to photograph easily. The usual caveat applies about the monitor I'm using...no CP filter on these shots even though some shots call for one since I don't have one that fits this lens. 

Today

Flags are out

Again, the usual cavea...also, two annoying specks of dust just showed up on my focusing screen.  Not clear how they got there.

Palin resigns Governorship of Alaska to become a Community Organizer without Responsibilities

At least that's what Palin is saying, to extent it is possible to parse her words, for resigning as governor after 2 1/2 years:

My choice is to take a stand and effect change – not hit our heads against the wall and watch valuable state time and money, millions of your dollars, go down the drain in this new environment. Rather, we know we can effect positive change outside government at this moment in time, on another scale, and actually make a difference for our priorities – and so we will, for Alaskans and for Americans.

Let me go back to a comfortable analogy for me – sports… basketball. I use it because you’re naïve if you don’t see the national full-court press picking away right now: A good point guard drives through a full court press, protecting the ball, keeping her eye on the basket… and she knows exactly when to pass the ball so that the team can win. And I’m doing that – keeping our eye on the ball that represents sound priorities – smaller government, energy independence, national security, freedom! And I know when it’s time to pass the ball – for victory.

Obama really inspires people across the political spectrum. 

I also like Palin's finishing flourish:

In the words of General MacArthur [who] said, “We are not retreating. We are advancing in another direction.”

Except, according to Gary Farber:

1) Douglas MacArthur didn't say it. It was said by General Oliver P. Smith, commanding general of the 1st Marine Division, in Korea, at the Battle of the Chosin Reservoir.

2) This was one of the biggest [the biggest?] military retreats in American history. (More here.)

Retreat under fire is difficult, costly and often disorganized.  Often  doesn't end well either. 

The community organizer quip is inspired by Palin's VP acceptance speech and other bloggers. 

Update #1: Reihan Salam writes:

No one wants to be a quitter. But sometimes you should quit! For example, you’re watching a terrible movie. Say you’re watching Tadpole, a movie so horrible that it makes me want to claw out not only my eyes but the eyes of the creators of the movie itself, just to teach them a lesson. Do you endure the whole thing? I did, and I’ve regretted it ever since.

Sarah Palin had a sense of how this movie was going to an end. Was this unfair to the people who put her in office? Actually, I’m pretty sure a lot of them are relieved.  ...

I sincerely think she’d make an excellent television personality.  ... I can’t imagine she’d be a great president or senator, and those were the logical next steps in this career trajectory.

Circular Polarizing Filter Physics Test

Does my new circular polarizing filter work?  As I've mentioned, I don't currently have access to a good monitor to look at my photos.  But even so, there are a few cases where, yes, it looks like I've not been sold a piece of flat glass.   Here two shots of a car with lots of reflecting light with different orientations of the filter, both shot about 5 seconds apart with the same perspective and lighting.  Also note the reflection of the barn on the left side of the car. 

First Vacation Day without Rain

I still cannot really see how this looks on the monitor I'm using.  Also I made the error of turning off horizonal image stabilization for some panning shots of the kids and not turning it on again. 

Kid #2 is seven years old

AIG Financial Products Update

Felix Salmon quotes Michael Lewis writing about AIG FP:

[AIG] FP literally had no idea what it was doing. He tells the story of Gene Park, who examined FP’s business at the end of 2005 and found that it was insuring deals which were 95% subprime:

Park then conducted a little survey, asking the people around AIG FP most directly involved in insuring them how much subprime was in them. He asked Gary Gorton, a Yale professor who had helped build the model Cassano used to price the credit-default swaps. Gorton guessed the piles were no more than 10 percent subprime. He asked a risk analyst in London, who guessed 20 percent. He asked Al Frost [FP's main liaison to Wall Street], who had no clue.

Cassano simply trusted the models (which were built with a lot of Gorton’s help), even when the models weren’t designed for subprime in particular, or even really for mortgages.

California IOUs

The California IOU situation looks like it might get interesting.  Not clear to me how this institutional feature fits into the overall politics, economics and law of fiscal federalism in the US.  Just figuring out how the game is set up and played would be nice. 

No Candid Shots

Runner's World does a spread with Sarah Palin. (via -- who else? -- Sullivan.)

Update #1: not quite Jeff Koons, but getting there.   Any more appropriate comparisons?  This is art. 

Today

Still rainy. I cannot see my photos with any degree of detail on the eight year old laptop monitor I am using, so please excuse the post-processing.  No CP filter except on the first shot -- the day was too dark and I cannot see the effects on the monitor I have anyway.  

Circular Polarizer

I got a 67mm B+W Kaesemann circular polarizing filter for my 70-200mm f/4 IS lens, but I'm now limited in trying it out: the laptop monitor I have access to on vacation is so bad that one cannot expect to see any differences,  even less so access image quality.  No blue skies either, not that getting bluer skies is the only effect for this filter. 

First shot with the CP filter below, you can probably see more than I can right now.   Effect may be very limited here, hard for me to tell.  The sky here may be more blue than in reality.  Not that this effect is useful on a foggy rainy day when showing the haze is what you want. 

Bing Crosby

The WSJ writes in a review of Perfecting Sound Forever:

[By] the 1960s the record business was engaged in the wholesale manipulation of sound, an advance made possible by the Nazi invention of magnetic tape. The Magnetophon machine that enabled sound to be cut, spliced and edited without loss of verisimilitude was stolen at the end of World War II from a German radio studio by a G.I. named Jack Mullin. Shipped home to California, Mullin persuaded Bing Crosby, who suffered stage fright on live radio, that he could pre-record his show and put it out undiminished on air.

Wiki has a longer version of the story.  Crosby's importance seems to be that he was a high visibility beta tester and an investor in the technology.  What seems puzzling to me is the long lag between AEG bringing out the first machine in Germany in 1935 and the US use in 1947. 

Chicken are here

One of the great aunts procured two chicken and two baby goats.  All showed up yesterday. Here's one of the chicken.  Shots of the goats all have kids in them.  Hard for me to tell if the photo is properly processed since I'm using an old and very dull laptop monitor. 

Update #1: as David asks in comments, what's the deal with the clipped beak? I assume this is because these are rental chicken that are rented to families with kids.  I am not involved in the process, but I'll ask. No idea how annoying this is to the chicken. 

Update #2: on a bit more reflection, it seems to me that clipping beaks may just be what one does if one holds chicken in close quarters (i.e. where these chicken come from).  Though this may be a bit more of a clip than most, I don't know. 

Update #3: David writes:

Clipping beaks impairs their ability to forage. I think they just do that for factory farms. Hens are usually pretty gentle. Roosters are different, of course.
Looks like a Rhode Island Red. Is it laying eggs for you?

One large egg on Monday, no reports of any more that have made it to me. 

On vacation in sunny Massachusetts

3 am at the home office

Yes, not only do I read the news at 3 am, so does my wife.  Aka kid free time. I was up trying to get a UV filter off my 17-55mm lens, finally successful without, it seems, any damage to the lens.  The trick is to use a rubber band to get a better grip on the filter ring.

Local Geese

Shot from the moving car down by the pond at the end of our street. 

Color Illusion

via Matt Steinglass, Discover magazine's blog has an impressive optical illusion.  This illusion suggests why white balance isn't a straightforward problem in photography.  

The original was apparently posted on Buzzhunt Akiyoshi Kitaoka’s incredible optical illusion website.  The green and the blue spirals are the same color.  For pedantry sake, the RGB colors in both spirals are 0, 255, 150. So they are mostly green with a solid splash of blue.

Market Declines on Michael Jackson Death

My wife commenting on the stock market opening just now.