Yes, it’s not even close.

Gee, I wonder why we’re going bankrupt…

And those are just 3 graphs! Want to see the other 19? Click here to download the whole report (.pdf).

I’ve already asked the question, but I’ll ask it again…why do we pay so much more for health care????

I’ve been genuinely intrigued at how much fiction and reality have been intersecting recently.

See, there’s this film called MOON and it follows the story of a guy working on the far side of the moon who figures out that there’s a lot more to his mission than collecting the natural resource Helium-3. It’s a fantastic piece of science fiction cinema and if you haven’t seen it, do yourself a favor and catch it while it’s still in theatres.

But after seeing it I discovered that not only is the energy source they talked about in the movie real, but it’s clean, supposedly economically viable and extremely plentiful on the moon’s surface.

More at True/Slant.

I thought it was a joke when I first heard about it, but “Seasteading” is a serious idea, it’s being backed by Milton Friedman’s grandson and they’ve apparently already raised more than a half a million dollars to realize their dream of building communities…on the sea!

Here’s more from Reason:

Patri Friedman was doing all right himself, living with his wife and child in a mini-commune of sort—the kind people today call an “intentional community”—in Mountain View, California, a bit south of San Francisco. He had a great and challenging job with a great company, Google. But his preoccupation, his passion, lay elsewhere. He thought he had figured out the real underlying problem bedeviling society, and it went deeper than just governments themselves. The real solution, he came to think, would involve the lure of the bounding main, the unbounded horizon, our vast and empty oceans.

Remember those high exit costs? Friedman wondered: What if you could just move—not just you, but everything you own, including your home, and, if your neighbors agreed with you, your whole community? What if you could move all of it where no government would bother you at all, and you could make a new, better society?

Friedman called his theory “dynamic geography.” He remembered a line from his dad’s book The Machinery of Freedom about how differently terrestrial government would behave if everyone lived in trailers and could easily flee state oppression. If land itself could get up and go, the incentive structure of government would change even more, moving it in a libertarian direction.

No doubt it’s an interesting notion, but is this practical? Living on the sea? Just think of how much risk that could entail. Of course you’d do the research to make sure you’re settling in a place that isn’t prone to natural disaster, but it’s still THE SEA. Talk about a wildcard if there every was one.

Still, this may represent a better chance to live the libertarian life than via electoral change, as Patri points out…

Libertarians, he says, expend precious time and energy on truly and self-evidently impossible paths toward political change. “Like the Ron Paul movement,” he says. “Lots of libertarians’ effort and millions and millions directed in a way that’s hopeless! For real change [electoral politics is] totally hopeless. Think how much more likely to succeed [libertarians would be] if that amount of resources were put into something that could actually work.” By which he means seasteading. And you have to admit: When you compare it to the likelihood of creating a libertarian world through American politics, seasteading starts to look more and more sensible.

Is it really that hopeless? I certainly don’t think so, but I will say that the Ron Paul movement was unrealistic to the point of being damaging to the libertarian cause. So maybe taking to the seas does have some benefits after all. :-)

In any event, here are some more articles about the movement…

• Live Free or Drown: Floating Utopias on the Cheap
• Seastead, Ahoy!
• Welcome aboard a brand new country

More as it develops…

There’s been a lot of talk about this little virus the past couple days, so I figured it might be helpful to connect everybody with some more stories that could help you sort the wheat from the chaff.

And away we go…

• Officials in Mexico are scrambling to find the source of the infection, and it points directly to the story about a pig farm we talked about earlier today.
• CBS reports that the Department of Homeland Security is setting some guidelines for a swine flu quarantine. Fingers crossed we won’t have to use them.
• Dems are jumping on the possibly pandemic as a way to show that they’re offering leadership.
• Two deaths in L.A. county were thought to possibly be related to outbreak, but later were proven not to be.
• The CDC thinks there will be at least some American deaths from the flu with 68 reported cases so far.
• Michele Bachmann actually links swine flu outbreaks to Democratic control. Too bad she’s wrong. Otherwise it totally could have become a campaign issue!
• Including Mexico and the US, 7 countries have reported cases but only the ones in Mexico have proven fatal so far.
• A debate is starting about whether or not this should even be called swine flu because people think they could catch it from pork products.
• And to that point, The Ag Secretary has already stopped calling it swine flu and is not talking about the “2009 H1N1 virus outbreak.”
• A vaccine is on its way, but it could still take a few months to grow.
• Will this outbreak be extremely fatal? David Dobbs doesn’t think so and has some numbers to back it up.

So that’s it for now. If you have any stories, drop them in the comments below, but please use URL shorteners like Tr.im or TinyURL.com so the link isn’t huge.

More as it develops…

A Smithfield Foods farm could be linked to the outbreak.

Grist has more…

Is Smithfield Foods, the world’s largest pork packer and hog producer, linked to the outbreak? Smithfield operates massive hog-raising operations Perote, Mexico, in the state of Vera Cruz, where the outbreak originated. The operations, grouped under a Smithfield subsidiary called Granjas Carroll, raise 950,000 hogs per year, according to the company Web site.

On Friday, the U.S. disease-tracking blog Biosurveillance published a timeline of the outbreak containing this nugget, dated April 6 [...]

Residents [of Perote] believed the outbreak had been caused by contamination from pig breeding farms located in the area. They believed that the farms, operated by Granjas Carroll, polluted the atmosphere and local water bodies, which in turn led to the disease outbreak. According to residents, the company denied responsibility for the outbreak and attributed the cases to “flu.” However, a municipal health official stated that preliminary investigations indicated that the disease vector was a type of fly that reproduces in pig waste and that the outbreak was linked to the pig farms. It was unclear whether health officials had identified a suspected pathogen responsible for this outbreak.

Now, as anybody who has ever passed by a corporate pig farm will tell you, they’re awful, awful, places. And often, they have these open-pit lagoons of pig feces that literally just sit there and allow any type of nastiness to breed in it. That includes drug resistant strains of staph infection and other forms of super bacteria that literally feed on the medication that was once used to stop it. And too often these lagoons aren’t properly protected and the waste gets into rivers and other water supplies. Disgusting stuff.

And, by the way, if you think I’m picking on Smithfield Foods, I’m not. Their record is atrocious when it comes to waste management, and if it resulted in the current outbreak you can be sure there will be hell to pay when this all shakes out.

More as it develops…

“Venezuela is a country whose defense budget is probably 1/600th of the United States’. They own Citgo. It’s unlikely that as a consequence of me shaking hands or having a polite conversation with Mr. Chavez that we are endangering the strategic interests of the United States. I don’t think anybody can find any evidence that that would do so. Even within this imaginative crowd, I think you would be hard-pressed to paint a scenario in which U.S. interests would be damaged as a consequence of us having a more constructive relationship with Venezuela.”
- Obama addressing his critics who have accused him of showing weakness

Critics like Newt Gingrich…

“Frankly, this does look a lot like Jimmy Carter. Carter tried weakness, and the world got tougher and tougher, because the predators, the aggressors, the anti-Americans, the dictators – when they sense weakness, they all start pushing ahead,” Gingrich said on “Fox & Friends.”

Critics like Congressional Republicans…

Two Republican senators, Judd Gregg of New Hampshire and John Ensign of Nevada, joined in the criticism Monday, with Ensign calling Obama’s greeting of Chavez “irresponsible.”

Critics like Dick Cheney…

Former Vice President Dick Cheney told Fox News Channel’s Sean Hannity that President Obama’s handshake with Venezuelan President Hugo Chavez “was not helpful” and could lead “foes” of the U.S. to “think they’re dealing with a weak president.”

Lest I remind my Republican friends…

This is too easy.

Quite a nice surprise on this holiday weekend.

From ABC:

A senior US official tells me that President Barack Obama approved a recommendation by Defense Secretary Bob Gates and Joint Chiefs of Staff Adm. Michael Mullen to dispatch special forces to the US scene on Friday.

These special forces were authorized to take action “in extremis” against the Somali pirates holding Maersk Captain Richard Phillips, 53, hostage on a motorized lifeboat off the coast of Somalia.

So how did it all happen?

You won’t believe it…

A senior official tells me that when the fourth Somali pirate was on the Bainbridge ship, Phillips moved to side of the lifeboat to relieve himself.

At that point, U.S. special forces saw their opportunity and took other three pirates out.

And that will be the luckiest leak that Captain will ever take.

One US official suggested that this could make one hell of a movie, but what kind of action film culminates in somebody taking a piss off the side of a boat?

Maybe it’ll be a funny action film. :-)

Fair warning, there’s a little bit of cursing in this.

We win!

*shudder*

(h/t: Sully)

From The Census Bureau:

February exports of $126.8 billion and imports of $152.7 billion resulted in a goods and services deficit of $26.0 billion, down from $36.2 billion in January, revised.

February exports were $2.0 billion more than January exports of $124.7 billion. February imports were $8.2 billion less than January imports of $160.9 billion.

And here’s a handy dandy graph…

Of note, these numbers are the lowest since 1999.

(h/t: Calculated Risk)

And after the AIG mess, I say we give it to him. How we allowed one company to take down the entire system still feels unreal to me. How on earth could we allow that to go down? Crazy, crazy, crazy.

But it did happen and we are suffering massive fallout as a result, so we have to make absolutely sure we’re protected. And, like it or not, the only way to do that is give the government more power.

From Bloomberg…

The authority would allow the Treasury, in collaboration with the Federal Reserve, regulators and the president, to step in and more easily combat problems at systemically important institutions on the verge of failure, said the official, who spoke on the condition of anonymity. AIG has received $182.5 billion in government bailout funds, according to the Government Accountability Office.

“We must ensure that our country never faces this situation again,” Geithner is expected to say according to excerpts of his testimony obtained by Bloomberg News. “To achieve that goal the administration and Congress have to work together to enact comprehensive regulatory reform and eliminate gaps in supervision.”

The expanded powers, which require Congressional approval, could help monitor risk and detect problems across an array of financial-services firms to prevent shocks to the global economy such as the one caused by the collapse of Lehman Brothers Holdings Inc. in September. [...]

It would also ensure proper accountability when taxpayer funds are provided to institutions in extreme circumstances, like AIG, which is now 80 percent owned by the government. The authority would provide the government with various tools including the ability to break contracts on executive compensation commitments, like those at the center of the furor over the insurance-giant’s $165 million in bonuses.

More transparency and more accountability.

What’s not to like about this?

And remember, since global commerce is so tied to our banking system, we have a responsibility not only to our taxpayers, but also the rest of the world. Because don’t kid yourself by thinking that China’s public calls to consider replacing our currency in the reserve basket didn’t come as a direct result of letting firms like AIG overleverage themselves to the point of insolvency.

You knew the time would come when the dollar would fall out of favor, but did you think it would happen this fast?

Actually, it’s not just the dollar that we’re talking about here. What China is proposing is leveling the playing field and including all world currencies in the reserve basket, which now only includes the dollar, the yen, the pound and the euro. So this wouldn’t amount to the monetary armageddon some were predicting since it would happen over a much longer period of time, but these adjustments would still have repercussions.

From Financial Times:

Analysts said the proposal was an indication of Beijing’s fears that actions being taken to save the domestic US economy would have a negative impact on China.

“This is a clear sign that China, as the largest holder of US dollar financial assets, is concerned about the potential inflationary risk of the US Federal Reserve printing money,” said Qu Hongbin, chief China economist for HSBC.

Although Mr Zhou did not mention the US dollar, the essay gave a pointed critique of the current dollar-dominated monetary system.

“The outbreak of the [current] crisis and its spillover to the entire world reflected the inherent vulnerabilities and systemic risks in the existing international monetary system,” Mr Zhou wrote.

Note the language there in that last sentence. The world was relying on the US to lead the way when it came to finance. And for a time it worked out, but our deregulatory policies threw the entire thing into a tailspin, and now world powers aren’t so trusting anymore…especially when we want to deficit spend (even though they’re doing the same thing).

More as it develops…

What would happen if the dollar wasn’t the world’s reserve currency?

Well, we may just find out if an U.N. panel has its way.

From Reuters:

Currency specialist Avinash Persaud, a member of the panel of experts, told a Reuters Funds Summit in Luxembourg that the proposal was to create something like the old Ecu, or European currency unit, that was a hard-traded, weighted basket.

Persaud, chairman of consultants Intelligence Capital and a former currency chief at JPMorgan, said the recommendation would be one of a number delivered to the United Nations on March 25 by the U.N. Commission of Experts on International Financial Reform.

“It is a good moment to move to a shared reserve currency,” he said.

Central banks hold their reserves in a variety of currencies and gold, but the dollar has dominated as the most convincing store of value — though its rate has wavered in recent years as the United States ran up huge twin budget and external deficits.

What drove this thinking?

Well…

“Speculation that major central banks would begin rebalancing their FX reserves has risen since the intensification of the dollar’s slide between 2002 and mid-2008,” CMC Markets said in a note.

So Bush’s monetary policies drove this loss of confidence, but will Obama’s be any better?

This logic is most likely wrong, but if the dollar isn’t the reserve currency, doesn’t that mean that dollars would flood into the market, devalue the dollar even more and lead to inflation? And what would be our recourse? Gobble them up and deplete our currency reserves to provide a counterbalance?

Here’s the biggest issue…since no currency has been commoditized (backed by something of real value) this whole market has been faith based since 1971. So that’s what worries me. Because once people don’t have faith in the dollar, there are bound to be consequences? So what are those?

I welcome your thoughts, but please don’t come to the table spreading gloom and doom about the “complete collapse” of our currency. That’s not going to happen, but there could be some pain and I’d like to hear what that might be.

Perhaps one of the reasons why the administration didn’t think they could challenge the bonuses in the first place?

From the Guardian…

The company said it was legally obliged to pay traders $165m (£118m) in “guaranteed” bonuses, despite the near collapse of the insurer last September and its subsequent $173bn bailout by US taxpayers. Staff at the company’s offices in London – many of them in the financial products division identified as the root cause of its downfall – are included in the payout.

In an effort to quell a mounting furore, the Treasury Department said late last night that it would require AIG to repay the government more than $165 million in bonuses doled out last week.

In a letter to congressional leaders, Treasury secretary Timothy Geithner said the money would be deducted from the government’s latest $30 billion infusion of bailout funds to the insurance giant at the centre of the nation’s deepening financial crisis.

Geithner also said future bonuses would be subject to tough new limits now being developed for crippled companies getting rescued with taxpayers’ money.

Personally, I understand and sympathize with the populist rage, and I do think AIG should pay back the money, but this bonus situation is sucking the oxygen out of the debate and distracting from some REALLY big problems.

Hopefully we can move past it quickly and get focused on the budget, health care, etc.

I remember a discussion I had recently on this blog where I said that consumer spending drove this economy. Somebody disagreed and said our economy is based on making things. Well, that’s obviously not true if our trade deficit is the biggest in the world. Sure, we make things, but not nearly as much as we once did because we’ve embraced the idea of worldwide marketplace where “cheap” is the greatest good. And that POV has consequences.

In reality, we’re a country of middlemen, where stores offer up a ton of foreign made products and we buy them up to the point where we tens of thousands of dollars in debt. And the cracks are beginning to show…big time.

This is one of the reasons why I think the green energy spending initiatives put forth by this administration are so important. Because if we get that right, a new energy revolution will happen, our economy will flourish and we’ll get back to being a country of making things instead of simply buying things.

Still, a big time refocusing of priorities needs to happen. The “big screen TV” economic model simply isn’t sustainable and Americans needs to be aware.

(h/t: Right Democrat)

This has to be one of the most terrifying and haunting images I’ve ever seen. It takes a tragic place right alongside the Vietnamese children who are running down the road near Trang Bang after they got hit with napalm.

(credit: Telegraph)

As the economy goes cliff diving, the effects are being felt around the world.

From NY Times:

In its new report, prepared for a meeting next week of finance ministers from the 20 industrialized and large developing countries, the World Bank warned that the financial disruptions are all but certain to overwhelm the ability of institutions like it and the International Monetary Fund to provide a buffer.

Robert B. Zoellick, president of the World Bank, pleaded for wealthy governments to create a “vulnerability fund” and to set aside a fraction of what they spend on stimulating their own economies to help others.

“This global crisis needs a global solution and preventing an economic catastrophe in developing countries is important for global efforts to overcome this crisis,” Mr. Zoellick said in a statement. “We need investments in safety nets, infrastructure, and small and medium-size companies to create jobs and to avoid social and political unrest.”

This isn’t ending any time soon.

“We are in the midst of a phase of history in which nations will be redefined and their futures fundamentally altered.”
- Rupert Murdoch talks about the current state of the global economy in an internal memo

Anybody willing to bet against Murdoch’s prediction?

And do you think these futures will be better or worse?

Discuss.

Following up on his campaign promise to have a surge-like push in Afghanistan to see if it could help the country.

From Fox News:

“This reinforcement will contribute to the security of the Afghan people and to stability in Afghanistan,” Obama said in a statement. “I recognize the extraordinary strain that this deployment places on our troops and military families. I honor their service, and will give them the support they need.”

Obama said the deteriorating security in Afghanistan made the troop increase necessary, adding that the country has not received the strategic attention or resources it needs.

Although 17,000 troops have been authorized to go, the Pentagon identified and mobilized only about 12,000. Of those troops, 8,000 will be Marines and the 4,000 others will comprise an Army Stryker Brigade. The additional 5,000 troops will be identified and announced at a later date.

But sources provided FOX News with the identity of all 17,000 troops: 10,000 will be Marines stationed in the South; 3,800 with an Army Stryker Brigade; 1,000 Special Operations Force trainers and 3,200 force enablers.

Also, according to the following report, Sec of Def Robert Gates wanted 30,000 troops…

My guess is if more troops are needed in Afghanistan, that’ll be an easy case for Obama to make to pull troops from Iraq. And I have little doubt that more forces are required because right now it’s a mess.

More as it develops…

GDP dropping by 12%+ in Japan because nobody’s buying their exports.

Yikes.

Question…who is doing well?

Also, if this truly is a global economy and we’re all connected now, then how will we be able to pull ourselves back out of this if nobody’s buying what we’re selling either?

As I scan the wires I do get a sense that people all across the globe are genuinely inspired that Obama has become President.

What’s your take on it?