I hadn’t planned on writing about the official end of the war in Iraq. However, while I was performing my appointed rounds yesterday I tuned into a program on NPR on the subject that got my dander up. Since it’s a foreign policy question, I thought of posting my reactions over at OTB. But, since my reactions will consist of a brief rant, I thought better of it and if you can’t air your own grievances (’tis the season!) on your own blog, where can you?

The panelists on the program were Lawrence Wilkerson, Colin Powell’s chief of staff during his tenure as Secretary of State, Kori Schake, director for Defense Strategy and Requirements on the National Security Council at the outset of the invasion of Iraq, and Peter Beinart, editor of The New Republic at the time of the invasion, initially an ardent supporter of the war, later an opponent.

Mr. Beinart’s response to the question “What lessons have been learned?” was what got my goat. He responded (I’m trying to quote this as precisely I can), “We shouldn’t go to war without a proper cost-benefit analysis”.

War is killing and destruction. It is an act of necessity not just of calculation. For a war to be just it must be entered into under a competent authority, the objective must be just, it must be waged by just means, and war must only be waged as a last resort. If you require a cost-benefit analysis, it isn’t a last resort (it’s a policy preference) and it’s not a just war.

You cannot know the cost of a war in anticipation. You cannot know its benefits in anticipation. I can barely write that without spitting. How can a decent or honorable person speak or write of the benefits of killing and destruction? Believing that you can do so is casuistry and IMO it’s what lead us into the Iraq War in the first place.

I sincerely hope that most of my countrymen do not believe as Mr. Beinart does. If so, contrary to what Talleyrand is purported to have said of the House of Bourbon, “They have forgotten nothing and they have learned nothing”, we will have forgotten everything and learned nothing.

I’ve just published a foreign policy-related post at Outside the Beltway:

Russian Customs Seizes Tehran-Bound Radioactive Metal

An Iranian passenger smuggling medical isotopes into Tehran will, unfortunately, probably be spun as yet another Iran dangerous nuclear development where I think it’s probably more likely to be a consequence of the trade restrictions placed on Iran. I find it a bit reassuring that the Russian authorities were on top of this and it made it into the press.

The bad news: the security at Russian nuclear facilities doesn’t appear to be as sound as we might like.

In reading this post of Scott Sumner’s I suddenly came up with an example that illustrates what bugs me about the description of the recession, economic downturn, slow recovery, or however you describe what’s going on now. Imagine a company that last year sold $100 million worth of widgets through a dealer network. This year for unknown reasons sales declined to $90 million. However, an unscrupulous sales manager in collusion with some equally unscrupulous dealers booked the entire $100 million and, via a scheme of phony sales, cancellations, and inventory transfers managed to make it appear as though everybody had made their numbers and, consequently, maintained their incomes. This may sound far-fetched but 30 years ago I worked for a company in which something very much like this actually happened.

The company ultimately uncovered the scheme and fired the sales manager. That made top management feel better about the situation but it didn’t solve the real problem at hand: sales weren’t as high as they thought they had been.

The analogy I see is to total employment. I think that the problem we’re having with creating jobs actually has been in process for decades and, with a succession of bubbles, has been made to appear much less severe than it actually is.

We’re no longer in a recession. We’re in a recovery. However, the jobs that were created during the successive bubbles have been wrung out of the economy and don’t appear to be coming back. As I’ve noted in previous posts none of the economic sectors we might typically expect to start booming and creating jobs at a rapid pace are likely to do so.

Pointing to the current president or his predecessor or even his predecessor for blame may be satisfying but it doesn’t actually solve the underlying problem.

I’ve just published a foreign policy-related post at Outside the Beltway:

Occupy Wukan

The Chinese fishing village of Wukan is in open revolt against the Chinese authorities over the village’s land having been forcibly sold. One protester has died while in custody. The authorities are laying siege to the village.

In the course of a year there are a sizeable number of protests in China. Some, like this one which reportedly involves 20,000 people, are of considerable size. Some are put down by force.

This particular protest appears to have been caused by some combination of inflation (particularly the rising cost of food) and China’s property bubble. I think this is a remarkable development.

Tyler Cowen quotes a paragraph from Mark Pagel:

A tiny number of ideas can go a long way, as we’ve seen. And the Internet makes that more and more likely. What’s happening is that we might, in fact, be at a time in our history where we’re being domesticated by these great big societal things, such as Facebook and the Internet. We’re being domesticated by them, because fewer and fewer and fewer of us have to be innovators to get by. And so, in the cold calculus of evolution by natural selection, at no greater time in history than ever before, copiers are probably doing better than innovators. Because innovation is extraordinarily hard. My worry is that we could be moving in that direction, towards becoming more and more sort of docile copiers.

Since Facebook is part of the Internet (try to imagine a Facebook without the Internet—basically the personals column of a newspaper or maybe a scrapbook pasted on a bulletin board), if this means anything at all it appears to me that Mr. Pagel is using “Internet” as a synonym for what might be called “the Googlesphere”—the results of a Google search and the pages to which the search links.

However, the Internet is not the Googlesphere. I think that assuming that it is places excessive confidence in Google’s algorithms which, after all, have the primary purpose of securing ad revenue for the company.

I’m guilty of violations myself although I do try to crosscheck the searches I make using both Google and Bing. I note that dogpile.com is down to Google, Yahoo, and Bing. That’s a shocking loss of diversity in just ten years.

While I’m on the subject of words and phrases, this post from Keith Hennessey on the comparative voting records of the Republican and Democratic caucuses in the Congress on trade bills is interesting. As I presume will surprise no one, Republicans vote overwhelmingly in favor of these bills while the Democrats have voted more or less against although without the consistency of Republicans on the matter. As Will Rogers wisecracked eighty years ago when asked if he were a member of an organized political party, “No, sir. I’m a Democrat”.

However, I have some problems on characterizing these trade bills as “free trade” legislation. You can write a free trade agreement on the back of a business card. When the bills and agreements run into the hundreds or even thousands of pages, you can be pretty confident that they aren’t about free trade but on managed trade and the precise terms under which it will be managed.

Clearly, the Republicans and Democrats disagree over what those terms should be. I wish there were better coverage over just what the disagreements were rather than the ordinary tribal chanting. I’d genuinely like to know.

On something of a disgression whatever became of the constitutional proscription of bills of attainder? Modern legislation seems to be full of them without much of a peep about it. We don’t even seem to be pretending any more.

I’m taking suggestions for words and phrases of the year. Here are my candidates so far:

rehypothecation
coordination failure
occupy
austerity

Candidates should be words or phrases that were new this year, entered common parlance this year, or came into special prominence or relevance this year.

James Joyner takes Paul Krugman to task:

Now, Krugman is a Nobel Prize winning economist whose claim to fame is research on the Great Depression. I have neither of those credentials. Still, words mean things and depression is not simply a period of high unemployment. Indeed, according to the National Bureau of Economic Research–the US government agency that officially declares these things–the recent recession lasted from December 2007 to June 2009. So, not only are we not in a depression, we’re not even in a recession but rather in a period of slow expansion that’s lasted more than two years.

The late economic downturn was not a depression. It was a sharp recession. We are now in a recovery, not a recession. Those are facts as facts are reckoned in economics which is rather more like a game than the deadly serious matter that it is. The umpire has made his call and that’s that.

In the real world of humans, loss of jobs, few jobs to take, and struggling to pay bills that may be hard to stomach and the truth of the matter is that some areas might reasonably be deemed to have had a depression and, possibly, in some areas no recovery may be in sight.

Now for the opinion part of this post. In my opinion as in the aftermath of so many economic crises the effects of the economic downturn might actually be less problematic than the adverse effects of the policy response.

James Hamilton is critical of the measurement of how much banks have been credited with that I linked to last week:

If you take the position that each new loan should be added as a running contribution to some total, then you are led to maintain that when the Fed loans $1 B to Bank A in the form of a 30-day loan, and loans $1 B to Bank B in the form of an overnight loan that is repaid and renewed each day, then the Fed has 30 times the exposure to Bank B as it does to Bank A. You are further led to infer that the Fed could have lost $1 B in lending to Bank A but somehow could have lost $30 B lending to Bank B. And you are led to infer that it is 30 times safer to make a 1-month loan than it is to make a series of overnight loans in the same amount. Good luck managing your or anybody else’s finances, if that’s your way of thinking.

But Professor Wray goes on to speak admirably about an analysis by his student James Felkerson that does exactly that, and concludes that the Fed lent not $7.77 trillion but instead $29 trillion. For example, Felkerson takes the gross new lending under the Term Auction Facility each week from 2007 to 2010 and adds these numbers together to arrive at a cumulative total that comes to $3.8 trillion. To make the number sound big, of course you want to count only the money going out and pay no attention to the rate at which it is coming back in. If instead you were to take the net new lending under the TAF each week over this period– that is, subtract each week’s loan repayment from that week’s new loan issue– and add those net loan amounts together across all weeks, you would arrive at a cumulative total that equals exactly zero. The number is zero because every loan was repaid, and there are no loans currently outstanding under this program.

But zero isn’t quite as fun a number with which to try to rouse the rabble.

I think that Dr. Hamilton is correct if what you’re trying to do is measure what for lack of a better word I’ll call “exposure” but there are other and, I think, legitimate reasons other than rabble rousing to consider other measurements. For example, Dr.Wray’s figure might be looked at as a measurement of opportunities for shrinkage. I appear to be in the minority but that concerns me more than exposure.