Socialism

by McCleary

The Washington Times reports today on a RNC sponsored resolution accusing President Bush and Republican leader of embracing socialism. About seven years too late to be truly helpful, but I do approve of the gesture.

Still, this line (the Times', not the RNCs') is a bit laughable:

"If enacted, the resolution would put the party on record opposing the $700 billion bailout of the financial sector, which passed Congress with Republican support and was signed by Mr. Bush..."

My advice for Republicans looking to come in from the wilderness: If you really wanted to be "the party on record opposing the $700 billion bailout," maybe your Sens and Reps shouldn't have voted for the bailout, maybe your presidential candidate shouldn't have suspended his campaign to work on its passage, and maybe your President shouldn't have signed it.

Happy New Year

And incidentally, this is an absorbingly weird movie, just rebroadcast on SciFi.

Motorized miasma

Recommended reading: "Why Detroit Has an Especially Bad Union Problem." Where is Lemuel Boulware when we need him?

Surfing too far

A journalist named Travis F. Smith (you can Google him here) contemplates the limits of Internet sleuthing/stalking after a woman he just met blocks him on Facebook.

Tax swap

Bob Inglis and Arthur B. Laffer sketch out "An Emissions Plan Conservatives Could Warm To," which would combine a carbon tax with a cut in payroll and/or income taxes. As they correctly see, there are many reasons -- environmental, national-security, economic -- to take such an approach, regardless of how alarmed or not you are about global warming.

Roosevelt and Hamilton

Max Boot contines to defend, rightly, Theodore Roosevelt against "T.R.-was-no-conservative"-type attacks such as the latest by a Prof. Ronald Prestito. Prestito's WSJ op-ed at least takes the novel approach of contrasting Roosevelt with Alexander Hamilton, contrary to any number of conservative critiques that see both as dangerous deviationists from free-market orthodoxy. Both T.R. and Hamilton were defenders of limited government. Both favored some degree of government activism at times when government was much, much smaller than it is today. Both were examples, moreover, of government competence. A major problem with activist government is that the people in charge of it aren't usually as talented as a T.R. or Hamilton, because that kind of talent doesn't show up regularly or on demand.

UPDATE: Jonathan Adler goes negative on T.R. (and Boot) here, the gist being that various state interventions Roosevelt called for are no longer in favor. I'm not very impressed by Adler's response. For one thing, it's not true that the idea of government ownership of resources such as timber has been utterly rejected; there's no great push for privatizing national forests, though I know some have called for that. Nor is there much momentum for getting rid of all antitrust, which would be the "complete repudiation" Adler claims has befallen T.R.'s antitrust policies. And even if that were so, it would tell us only so much about whether Roosevelt's policies were appropriate for the economy of his time, in which power was concentrated in big companies in a way hard to imagine now.

Tango steps

Some advice on how to do things if you're going to dance a tango in Argentina, including how to maneuver on a crowded dance floor.

A big advantage of taking tango lessons, though, is that, outside of Argentina, you'll likely have a fairly uncrowded dance floor once a tango starts. And your performance, if it's like mine, will impress people in the same way as Samuel Johnson's dog "walking on his hind legs. It is not done well; but you are surprised to find it done at all."

The universe and George Will

A Christmas Eve thought: I wonder when George F. Will became an agnostic? I was surprised to find him on the blogroll of Secular Right, and after some quick Googling, to find that he declared himself an agnostic on the Colbert Report. Almost a decade ago, I wrote an article for Reason about weak conservative arguments for religion based on the strong anthropic principle. One of those I took to task was George F. Will, who had opined in Newsweek that certain physics findings were "theologically suggestive." I recall that I sent the piece to Will when it was published. Could it be that my riposte to him was so devastating that it pushed him away from adducing dubious scientific evidence for religion? Probably not, but if there's a multiverse, that might have happened in a universe somewhere.

Merry Christmas!

Neocon split?

Jacob Heilbrunn has an interesting piece on "Where Have All the Neocons Gone?" His bottom line is that the Obama administration, with Hillary at State, is going to have considerable appeal to one branch of neoconservatives (particularly those based in Washington) while another branch (mainly in New York) embraces a hard-right Republicanism/Palinism. I don't know if that's correct, but it's plausible. And while I'm more libertarian than either of these putative factions, if I had to choose, I'd go with the center-right over the hard right (and would, incidentally, expect them to be more influential as well).

Apollo 8 anniversary

My piece about Apollo 8 four decades later is now up at Scientific American Online as part of an in-depth report.

No safe havens

by McCleary

When I tell people I work at the business school of private university (Duke), there is always the assumption that I'm at the one place where business is still good. After all, applications to daytime MBA programs are frequently countercyclical, and indeed, Fuqua, like many b-schools, is experiencing an increase in both quality and quantity of applications.

But as the Raleigh News & Observer reported Friday, Duke University's endowment has dropped 19%. The article also mentions other top-tier universities with similar declines: Yale at a reported 25% and Harvard at 22%. As bad as these numbers look, the real story is probably far worse. Most schools have a decent stake in private equity investments, the losses of which are extremely difficult to estimate. So when the dust clears, look for a significant downward revision of endowment losses. For schools relying on endowment income for operations, this will likely mean hiring freezes, salary freezes, and layoffs.

Space stuff

CNN is now posting space photos every week. If you like them, also keep an eye on APOD (Astronomy Picture of the Day).

Forty years ago today, Apollo 8 got started. Scientific American Online will soon have some coverage relevant to that mission, including a piece by yours truly.

Deceleration

Posting may be light in the near future, unless the guest bloggers show up.

UPDATE: One of my guest bloggers tells me his access has expired, which is news to me and doesn't show up on my side. I will try to fix this, somehow.

Ponzi history

Since a Ponzi scheme is much in the news these days, here's some historical background on the original Ponzi, from my recent piece on Boston financial history:

Charles Ponzi , born in Italy in 1882, arrived in Boston in 1903. Then he went to Canada , where he spent some time in prison for forging a check. Not wanting to tell his mother about this, he wrote to her that he’d gotten a job as “special assistant” to a prison warden.

Ponzi returned to Boston in 1917. Two years later, he got a letter from Spain with an international postal reply coupon for mailing a catalog Ponzi was proposing to publish. With that, he came upon the idea of investing in these postal coupons, and making profits from differences in international postage rates.

He started his own firm, the Security Exchange Corporation (not to be confused with the then nonexistent Securities and Exchange Commission) and encountered enormous interest among investors. Unfortunately, Ponzi’s business plan, though legal, was unworkable, involving multiple currency exchanges and postal bureaucracies.

Still, Ponzi promised a 50 percent return on investment in 45 days, and for a while he kept his word. The trouble is that he was paying investors merely by giving them money from later investors. Such deceitful dealing would come to be known as a Ponzi scheme.

More here.

Silberware

Another writer named Silber* explains how he manipulates human minds** at a podcast here.

*- my brother
** - writes marketing copy

Financial radio

I'm slated to be on the Gabe Wisdom Show tonight at 7 pm ET to discuss how a great deal of financial history was made in Boston.

Pro and khan

We rented Mongol: The Rise of Genghis Khan, which presented the conqueror in a fairly favorable light, at least as far as it goes through the early stages of his career. This inspired me to reread parts of books I'd read long ago: On the Other Side: a Journey Through Soviet Central Asia, by Geoffrey Moorhouse, which looks at ruins left by the Mongols and sees aggression stemming from evil, and Khubilai Khan: His Life and Times, by Morris Rossabi, which depicts the Mongols, including the title subject's grandfather Genghis, as surprisingly tolerant and benevolent rulers, albeit granted they were aggressive when resisted.

Moreover, the second book gives impersonal reasons, including some of climate change, for why the Mongols expanded, whereas the first sees it as pivoting on one man who wanted to take revenge upon the world for his father's death and his clan's betrayal. Where the truth lies I will not guess, but I was fascinated by Rossabi's passing comment that one consequence of the Mongol expansion was to elicit interest in Europe in trade with Asia, thus spurring Europe's age of exploration.

Multiverse cryonics

I tend to think it's a mistake to be influenced in a personal decision by the possibility that there are multiple copies of yourself scattered throughout the universe or other universes, given the enormous and incalculable uncertainties involved. However, if the decision you're making is whether to get your head frozen for possible future resurrection, then I suppose something being highly speculative isn't necessarily going to deter you anyway.

Exceedingly dim

The Spitzer telescope has found the dimmest stars ever, or dimmest brown dwarfs to be precise. There's an evocative artist's conception here, and Bad Astronomy has some comments here.

Crisis causation

Peter Wallison has an analysis of the causes of the financial crisis, with an emphasis on government policies. (Via David Frum.) As I found in working on an upcoming article for Research magazine, Wallison also was quite prescient in warning there would be a crisis. Here's a New York Times piece from 1999 on government-sponsored enterprises embracing subprime:

In moving, even tentatively, into this new area of lending, Fannie Mae is taking on significantly more risk, which may not pose any difficulties during flush economic times. But the government-subsidized corporation may run into trouble in an economic downturn, prompting a government rescue similar to that of the savings and loan industry in the 1980's.

''From the perspective of many people, including me, this is another thrift industry growing up around us,'' said Peter Wallison a resident fellow at the American Enterprise Institute. ''If they fail, the government will have to step up and bail them out the way it stepped up and bailed out the thrift industry.''