News from around the web: 2009-08-26
Which Bernanke are we getting for the next four years–the financial hero, or the oblivious professor who will allow another crisis to bloom? And why were we told so far in advance of the January deadline? Those are two big questions being debated in the wake of Obama’s earlier-than-expected announcement this morning (which we covered here). For a range of views on the Fed chief’s reappointment, we examined the responses of dozens of top econopundits and highlighted the best answers.
Forty years ago, Dr Lawrence Peter enunciated what he immodestly called the Peter Principle. Individuals would find their level of incompetence. If you were good at doing a job, you would be promoted until you were appointed to a job you weren’t good at. The recent failures of financial institutions suggests an organisational analogue. Financial institutions diversify into their level of incompetence. They extend their scope into activities they understand less until they are tripped up by one they cannot do.
Autodealer Cliff Johnson sold 70 vehicles under the government’s "cash-for-clunkers" program, which offered rebates of up to $4,500 to trade in older gas guzzlers. But the day after the program ended he’s only been paid for two and he’s worried about how quickly the government will reimburse him over a quarter of a million dollars and whether it will pay fully.
It is this twin-sided nature of Bernanke that raises nagging questions about his reappointment as chairman of the Fed. He has admitted errors: it was wrong to think the sub-prime crisis could be contained. But he has yet to acknowledge that his economic ideology is deeply flawed.
Why have Canadian banks fared better during the crisis than their OECD peers? This column attributes their stability to their reliance on depository funding rather than more risky wholesale funding. It recommends a Pigouvian tax penalising banks using excessive short-term wholesale funding.
Dealers from California to Texas saw lots empty of cars, pickups and SUVs over the weekend, as once-reluctant customers were lured back into the market by the $3-billion rebate program that ended at 8 p.m. EDT Monday (0000 GMT Tuesday).
Economists, lawmakers, bloggers and others weigh in on President Obama’s decision to reappoint Fed Chairman Ben Bernanke.
General Motors Co. can’t afford to retain control of its Opel division because the carmaker needs to concentrate on the U.S., according to Fred Irwin, chairman of the German government-backed trust created to facilitate a sale.
The relationship of the current banking crisis to the size of the economy is more than seven times greater than the worst year of the Great Depression (1933). This crisis is 19 times larger with respect to GDP than the next worst year, 1989, in the S&L crisis. These are astounding relationships. We have been and still are in unchartered territory
"Let’s start with a typical person who was born in 1944, began work at age 21 in 1965, and in 2009 retired at age 65 and enrolled in Medicare. Over the course of his life… This typical person paid around $64,971 in Medicare payroll taxes over his lifetime. Likewise, after netting out Medicare premiums, he’ll receive around $173,886 in lifetime Medicare benefits. The net? He can expect to receive around $108,915 more in benefits than he paid in taxes over his lifetime."
Although the redistributive effects of Social Security and Medicare are to some degree intragenerational, a lot of the redistribution works intergenerationally. Because it’s intergenerational–specifically from younger Americans/workers who have paid into these programs at higher tax rates than their parents and grandparents–and because each new American generation is less white than the previous one–such redistribution also has a racial effect. Moreover, as a result of different life expectancies, even the intragenerational redistributive effect has a racial element: Cato’s Michael Tanner explains in his 2004 book
Initially, it should be emphasized that yet again, it is not the Congress or the establishment media which is uncovering these abuses and forcing disclosure of government misconduct. Rather, it is the ACLU (with which I consult) that, along with other human rights organizations, has had to fill the void left by those failed institutions, using their own funds to pursue litigation to compel disclosure. Without their efforts, we would know vastly less than we know now about the crimes our government committed.
Wow, the pornographer-in-chief waxes poetically. Hat tip Yves Smith. Well worth a read: "The American government — which we once called our government — has been taken over by Wall Street, the mega-corporations and the super-rich. They are the ones who decide our fate. It is this group of powerful elites, the people President Franklin D. Roosevelt called "economic royalists," who choose our elected officials — indeed, our very form of government. Both Democrats and Republicans dance to the tune of their corporate masters. In America, corporations do not control the government. In America, corporations are the government."
Ted Rall called on Obama to resign for not meeting his soaring rhetoric. He is stirring things up again. "The death of half-assed Obamacare is merely the latest evidence of a fact that the left, in thrall to militant pacifism, refuses to see. Only two means exist in order to effect change: violence, or the credible threat thereof. The charged atmosphere of imminent violence permeating the town hall meetings intimidated liberal wimps from the grassroots to the Oval Office."
If you’re trying to innovate and be more inclusive, it’s fine to have a local dialect — as ATMs run by Bank Machine are doing in East London over the next few months — but for the love of uncle Fred, don’t use a lingo associated with wide boys and notorious criminals. For our American audience, imagine your reaction if your ATM asked if you’d like to "withdrizzle yo’ monizzle, homie."
At Mashable, we really like Disqus (Disqus) and even premiered its social media comments feature back in March. Today, the commenting service is rolling out Disqus V3 and it promises to be the biggest change to the product since its inception in 2007.
If you are stuck using Microsoft Outlook to send those TPS reports at work, you’ve already experienced just how painfully slow it can get—but with a few quick tips you can make it usable again.
Very graphic UK advert to warn about dangers of driving while texting. This video is VERY graphic, so beware.
Google’s displayed traffic information for major interstates and freeways for years, but starting today, the popular web-based mapping application adds traffic conditions for arterial roads—that is, heavily trafficked roads. Even better: It works with Google Maps on your cellphone.
Lots of companies offer software that’s supposed to stop worms, viruses, and other malware for free. We tested nine such security programs to find the ones you can really depend on.
Where’d the black guy go? Not so many in Poland, eh?
For the third consecutive year, McAfee surveyed which A-list celebrity was the riskiest to track on the internet after Pitt topped the list last year and Paris Hilton in 2007.
The advisors estimate that 40 to 60 percent of the U.S. population could contract the virus this fall and winter, compared with the average of 5 to 20 who get the seasonal flu
There’s no argument against reasonable measures to secure possibly dangerous terrorists. But in cases like Hashmi’s, secrecy is often applied with little vetting from judges, who defer to the government’s claims of national security.
The saga of the public plan is a story of the lobbying might of health care interests, indecisiveness on the part of the president, and the reluctance of the press to stitch all the pieces together. But there’s still a chance for redemption. Not much has been said or written about what’s left if the public plan vanishes—the individual mandate that will require every American (with few exceptions) to carry insurance.
Tom asks, "Why are senior citizens crying "socialism" at town halls?" As we like to say in academia: I don’t know the answer, so let me tell you something I do know. (Graphs made in collaboration with Daniel Lee.)…Pretty much the older you are, the less you favor government spending on health care.
Distraction of the Day: Michael Jackson’s death ruled a homicide