Complex trauma in childhood, a psychiatric diagnosis in adulthood: Making meaning of a double-edged phenomenon

Complex trauma in childhood, a psychiatric diagnosis in adulthood: Making meaning of a double-edged phenomenon. By McCormack, Lynne; Thomson, Sherilyn. In Psychological Trauma: Theory, Research, Practice, and Policy,  Vol 9(2), Mar   2017, 156-165.

Abstract: Objective: No known research explores the double-edged phenomenon of childhood trauma/adult mental health consumer. Therefore, whether receiving a psychiatric diagnosis in light of childhood trauma supports or impedes psychological wellbeing in adult life, is unknown. Method: Interpretative phenomenological analysis (IPA) provided the methodological framework. Data were collected through the use of semistructured interviews. Analysis sought thematic representation from subjective interpretations of the experienced phenomenon: childhood trauma survivor/mental health consumer. Results: Data revealed 1 superordinate theme, Childhood Betrayal, Identity, and Worthiness, that overarched 5 subordinate themes a) legacies, (b) the label, (c) putting the jigsaw together, (d) stigma, and (e) better than good enough self. Legacies of doubt that perpetuated “not good enough” delayed the development of an adult identity of worthiness in these participants. Importantly, the right diagnosis separated self as worthy-adult from self as traumatized child and facilitated positive change for breaking harmful cycles, self-valuing, and increased empathy, wisdom, and patience. Conclusions: Findings inform future research and therapeutic practice in regards to adult help seeking behaviors in light of childhood trauma, often postponed through fear of stigma associated with mental health diagnoses and services. Similarly, findings suggest that ameliorating wellbeing may be dependent on a therapeutic relationship in which accuracy or right fit of diagnosis provides a conduit for the client to disengage from self-blame, unworthiness, and “not good enough.”

Alemania reinventa la crisis energética. Por Holman W. Jenkins, Jr.

Alemania reinventa la crisis energética. Por Holman W. Jenkins, Jr.
http://online.wsj.com/news/articles/SB100014240527023044482045791857 20802195590
Wall Street Journal, Nov. 8, 2013 6:28 p.m. ET

ObamaCare no es el único tren en camino de descarrilar que tenemos  ahora. Como Mao apremiando a los campesinos para que fundieran sus cacharros, sartenes y útiles de labranza para convertir a China en un coloso  del acero de la noche a la mañana, Alemania repartía alegremente subsidios para alentar a los ciudadanos y granjeros a instalar  paneles solares y molinos de viento para luego vender la energía  resultante a las compañías eléctricas a precios inflados. El éxito  —Alemania obtiene un 25% de su energía de las renovables— ha  resultado ser un desastre.

Mientras los alemanes se apresuran a hacerse con su dinero fácil, la  producción de dióxido de carbono ha aumentado, no disminuido, porque las compañías, privadas de capital, han pasado a quemar carbón  americano barato para proveer de la necesaria energía cuando el  viento y el sol nos fallan.

Debido a que sol y viento son intermitentes y la red eléctrica está  pobremente preparada para acomodar estas fuentes, los apagones y las  reducciones de suministro amenazan en este invierno.

Como las facturas las pagan hogares y empresas, los precios de la  electricidad son el triple que en los EE UU. Un pánico apremiante es el del empleo, ya que industrias de gran aportación se dirigen a EE UU  para aprovechar la energía barata que ha producido la revolución de  las arenas bituminosas y los esquistos. El máximo responsable  energético de Europa habla ya francamente de la  "desindustrialización de Alemania".

En UK, donde la política pública ha sido casi tan generosa con las  renovables, "Está bien ser muy, muy verde, pero no si estás  interesado en la fabricación", según queja de un prominente CEO.

La gran virtud de la democracia es que no sigue con ciertos planes  hasta el precipicio, pero los mecanismos normales de ajuste están  agarrotados por el hecho de que el desastre energético de Europa  implica al entero espectro político.

Ed Miliband, líder del Partido Laborista de UK, ha fijado el tema de  las elecciones del próximo año cuando prometió recientemente  congelar los precios de la energía si se le elegía. Pero los  laboristas no van a abandonar los subsidios solares y eólicos que  crearon ellos mismos. Quieren dejarlos grabados en piedra, pasando  los costes a las empresas. En Alemania, la conservadora Angela  Merkel se adhirió completamente a las posiciones económicas sobre  energía de la oposición tras Fukushima, dejando a los electores  alarmados sobre los precios de la energía sin lugar al que tornar en  las elecciones de septiembre excepto a Angela Merkel, quien de forma  vaga mostró alguna moderación sobre la energiewende (revolución  energética) que lanzó y continúa liderando.

Un infrecuente destello de raciocinio ha partido en realidad del  probable socio de coalición de Angela Merkel, el SPD, autor de la  ley original sobre energías verdes, cuyo portavoz dice ahora:  "Necesitamos asegurar que la energía renovable es asequible. Y  necesitamos terminar con la idea de que podemos salirnos  simultáneamente de nucleares y el carbón. No va a funcionar."

Es tentador asumir que los políticos europeos eran feligreses de la  iglesia del calentamiento global. Pero más importante es su apego a  la ideología del agotamiento de recursos, que les convenció de haber  elegido un ganador en esta idea porque estaba garantizado que los  precios de los combustibles fósiles harían parecer baratos a los de  la energía verde.

"Cuanta más gente consuma petróleo y carbón, más subirá el precio,  pero cuanta más gente consuma energías renovables, más bajará su  precio", explicó el asesor energético de Angela Merkel.

He aquí una idea que parece ser impermeable a la experiencia y que  es parte del bagaje de todo político que pudiera ser elegido en  nuestro mundo. "Es absolutamente cierto que la demanda [de energías  fósiles] subirá mucho más rápido que el suministro. Ese es un  hecho", explicó el presidente Obama en 2011. Los EE UU "no pueden  permitirse apostar nuestra prosperidad a largo plazo a un recurso  que con el tiempo se agotará."

El Sr. Obama mencionó los fósiles no convencionales exactamente una  vez en su discurso — y solo para decir que también se agotarían.

Si todo esto fuera cierto, Europa no habría llegado a sus presentes  trabajos. Esta es la realidad: la revolución de los fósiles no  convencionales es menos revolucionaria de lo que parece. Ha sacudido  los errores comunes solo porque ha sucedido en las mismas narices de  los americanos, en áreas pobladas en que se asumía que los  "recursos" se habían extraído y transportado hace mucho.

De hecho, los depósitos de hidrocarburos que hay en el mundo son  verdaderamente vastos, incluyendo entre ellos cantidades inimaginables de hidratos de metano . El desafío es el tecnológico y económico de buscar el acceso a un determinado recurso  a un precio asequible — un desafío desde que se usaban trapos para  empaparlos en petróleo de manantiales naturales. Durante ciento  cincuenta años, el precio del barril de petróleo ha fluctuado entre  $10 y $100 (en dólares de 2011), un rango suficiente para encontrar  nuevas reservas cada vez que se quería requerían con objeto de  mantener a los hidrocarburos como fuente de energía de precio  competitivo.

La crisis energética europea es muy parecida a la nuestra de hace 40  años — autoinfligida. El sueño de Europa dejó de ser sostenible al  minuto de que los precios de la energía empezaran a caer en un  competidor comercial importante como los EE UU. LA gran pregunta ahora es cuán lejos irá la secudida política cuando toda la élite está implicada en un insatisfactorio experimento energético, que inevitablemente se ha visto envuelta en el desencanto del público con otro projecto fracasado de la élite, la Unión Europea.

Va a ser fascinante también la suerte de los shales europeos. En Europa, el gobierno, no los propietarios, controla y se beneficia de los recursos minerales, creando la política de suma zero en lo referente a recusos que han hecho al Oriente Medio un parangón de estabilidad y progreso. ¿Y el calentamiento global? Por suerte la respuesta es fácil. Los votantes europeos se van a acercar al punto en que están los americanos, dándose cuenta de que abjurar de la energía barata no hará nada por los niveles de CO2 (y aun menos por el clima) mientras otros no abjuren de la energía barata también.


---
Germany Reinvents the Energy Crisis
A love affair with renewables brings high prices, potential  blackouts and worries about 'deindustrialization.'
By Holman W. Jenkins, Jr.
http://online.wsj.com/news/articles/SB100014240527023044482045791857 20802195590
Wall Street Journal, Nov. 8, 2013 6:28 p.m. ET

ObamaCare isn't the only policy train wreck in progress. Like Mao  urging peasants to melt down their pots, pans and farm tools to turn  China into a steel-producing superpower overnight, Germany dished  out subsidies to encourage homeowners and farmers to install solar  panels and windmills and sell energy back to the power company at  inflated prices. Success—Germany now gets 25% of its power from  renewables—has turned out to be a disaster.

As Germans rush to grab this easy money, carbon dioxide output has  risen, not fallen, because money-strapped utilities have switched to  burning cheap American coal to provide the necessary standby power  when wind and sun fail.

Because the sun and wind are intermittent and the power grid is  poorly arranged to accommodate them, brownouts and blackouts  threaten this winter.

Because the bills are paid by households and businesses, electricity  rates are triple those in the United States. An immediate panic is  jobs, as prized industries head to the U.S. for cheaper energy  unleashed by the shale revolution. Europe's top energy official now  speaks frankly of the "deindustrialization in Germany."

In Britain, where policy has been nearly as generous to renewables,  "It's fine being very, very green, but not if you're interested in  manufacturing," complains a prominent CEO.
Enlarge Image

Wind turbines stand behind a solar power park near Werder, Germany.  Getty Images

Democracy's great virtue is that it doesn't follow schemes off a  cliff, but the normal adjustment mechanisms are hampered by the fact  that Europe's energy disaster implicates the entire political  spectrum.

Ed Miliband, leader of Britain's Labour Party, set the theme for  next year's British election when he recently promised to freeze  energy prices if elected. But Labour isn't about to disown the solar  and wind subsidies it created. It wants to soldier on, shifting the  cost to business. In Germany, conservative Angela Merkel embraced  the opposition's energy economics wholesale after Fukushima, leaving  voters who are alarmed about energy prices no place to turn in  September's election except Angela Merkel, who vaguely indicated  some moderation of the energiewende (energy revolution) she launched  and continues to champion.

An unwonted glimmer of reason has actually come from Mrs. Merkel's  likely Social Democrat coalition partner, author of Germany's  original green energy law, whose spokesman now says: "We need to  ensure that renewable energy is affordable. And we need to put an  end to the idea that we can pull out of nuclear and coal  simultaneously. This won't work."

It's tempting to assume Europe's politicians were praying in the  church of global warming. But more important is their subscription  to resource-depletion ideology, which convinced them they'd picked a  political winner because rising fossil fuel prices were guaranteed  to make green energy look cheap in comparison.

"When more people consume oil and coal, the price will go up, but  when more people consume renewable energy, the price of it will go  down," explained Ms. Merkel's top energy adviser.

We have here an idea seemingly impervious to experience and part of  the mental baggage of every politician likely to get elected in our  world. "It is absolutely certain that [fossil energy] demand will go  up a lot faster than supply. It's just a fact," President Obama  explained in 2011. The U.S. "cannot afford to bet our long-term  prosperity on a resource that will eventually run out."

Mr. Obama mentioned shale exactly once in his speech—and only to say  shale would run out too.

If all this were true, Europe wouldn't be in its present fix. Here's  the real truth: The shale revolution is less revolutionary than it  seems. It has shocked settled misconceptions only because it  happened under the noses of Americans, in populated areas where the  casual assumption was that "resources" would long ago have been dug  out and carted away.

In fact, the world's store of fossil hydrocarbons is truly vast,  including almost unimaginable quantities of methane hydrates. The  challenge is the technological and economic one of getting access to  a given resource at an affordable price—a challenge ever since men  used rags to soak up oil from natural seeps. For 150 years, the  price of a barrel of oil has fluctuated between $10 and $100 (in  2011 dollars), a range that has been sufficient to call forth new  reserves and feedstocks whenever needed to maintain hydrocarbons as  a source of competitively priced energy.

Europe's energy crisis is a lot like ours of 40 years ago—self- inflicted. Europe's dream was untenable the minute energy prices  began falling in a major trade competitor like the United States.  The big question now is how far will the political upheaval go when  an entire elite is implicated in an unsatisfactory energy  experiment, which inevitably has become wrapped up in public  disappointment with another failed elite project, the European Union  itself.

Fascinating too will be the fate of Europe's shale. In Europe,  government, not landowners, controls and benefits from mineral  resources, creating the zero-sum resource politics that have made  the Mideast a paragon of stability and civil progress. What about  global warming? At least that answer is easier. European voters are  coming out where Americans have, realizing that foreswearing cheap  energy will do nothing for CO2 levels (and even less for climate) as  long as others aren't foreswearing cheap energy too.

Rules of Thumb for Bank Solvency Stress Testing. By Daniel C. Hardy and Christian Schmieder
IMF Working Paper No. 13/232
November 11, 2013
http://www.imf.org/external/pubs/cat/longres.aspx?sk=41047.0

Summary: Rules of thumb can be useful in undertaking quick, robust, and readily interpretable bank stress tests. Such rules of thumb are proposed for the behavior of banks’ capital ratios and key drivers thereof—primarily credit losses, income, credit growth, and risk weights—in advanced and emerging economies, under more or less severe stress conditions. The proposed rules imply disproportionate responses to large shocks, and can be used to quantify the cyclical behaviour of capital ratios under various regulatory approaches.


Motivated by the usefulness of rules of thumb,

this paper concentrates on the formulation of rules of thumb for key factors affecting bank solvency, namely credit losses, pre-impairment income and credit growth during crises, and illustrates their use in the simulation of the evolution of capital ratios under stress.4 We thereby seek to provide answers to the following common questions in stress testing:

 How much do credit losses usually increase in case of a moderate, medium and severe macroeconomic downturn and/or financial stress event, e.g., if cumulative real GDP growth turns out to be, say, 4 or 8 percentage points below potential (or average or previous years') growth?

 How typically do other major factors that affect capital ratios, such as profitability, credit growth, and risk-weighted assets (RWA), react under these circumstances?

 Taking these considerations together, how does moderate, medium, or severe macro-financial stress translate into (a decrease in) bank capital, and thus, how much capital do banks need to cope with different levels of stress?

Macroprudential Liquidity Stress Testing in FSAPs for Systemically Important Financial Systems

Author/Editor: Andreas A. Jobst ; Christian Schmieder ; Li Lian Ong

http://www.imf.org/en/Publications/WP/Issues/2017/05/01/Macroprudential-Liquidity-Stress-Testing-in-FSAPs-for-Systemically-Important-Financial-44873?cid=em-COM-123-35149

Summary:Bank liquidity stress testing, which has become de rigueur following the costly lessons of the global financial crisis, remains underdeveloped compared to solvency stress testing. The ability to adequately identify, model and assess the impact of liquidity shocks, which are infrequent but can have a severe impact on affected banks and financial systems, is complicated not only by data limitations but also by interactions among multiple factors. This paper provides a conceptual overview of liquidity stress testing approaches for banks and discusses their implementation by IMF staff in the Financial Sector Assessment Program (FSAP) for countries with systemically important financial sectors over the last six years.

Series:Working Paper No. 17/102

Publication Date: May 1, 2017

ISBN/ISSN: 9781475597240/1018-5941

Stock No: WPIEA2017102

Pages: 56

A way to market to conservatives the science behind climate change more effectively

Past-focused environmental comparisons promote pro-environmental outcomes for conservatives. By Matthew Baldwin and Joris Lammers
http://www.pnas.org/content/113/52/14953.abstract

Significance

Political polarization on important issues can have dire consequences for society, and divisions regarding the issue of climate change could be particularly catastrophic. Building on research in social cognition and psychology, we show that temporal comparison processes largely explain the political gap in respondents’ attitudes towards and behaviors regarding climate change. We found that conservatives’ proenvironmental attitudes and behaviors improved consistently and drastically when we presented messages that compared the environment today with that of the past. This research shows how ideological differences can arise from basic psychological processes, demonstrates how such differences can be overcome by framing a message consistent with these basic processes, and provides a way to market the science behind climate change more effectively.


Abstract

Conservatives appear more skeptical about climate change and global warming and less willing to act against it than liberals. We propose that this unwillingness could result from fundamental differences in conservatives’ and liberals’ temporal focus. Conservatives tend to focus more on the past than do liberals. Across six studies, we rely on this notion to demonstrate that conservatives are positively affected by past- but not by future-focused environmental comparisons. Past comparisons largely eliminated the political divide that separated liberal and conservative respondents’ attitudes toward and behavior regarding climate change, so that across these studies conservatives and liberals were nearly equally likely to fight climate change. This research demonstrates how psychological processes, such as temporal comparison, underlie the prevalent ideological gap in addressing climate change. It opens up a promising avenue to convince conservatives effectively of the need to address climate change and global warming.

What scientists think of themselves, other scientists and the population at large

Who Believes in the Storybook Image of the Scientist?
http://www.tandfonline.com/doi/full/10.1080/08989621.2016.1268922 
Dec 2016

Abstract: Do lay people and scientists themselves recognize that scientists are human and therefore prone to human fallibilities such as error, bias, and even dishonesty? In a series of three experimental studies and one correlational study (total N = 3,278) we found that the ‘storybook image of the scientist’ is pervasive: American lay people and scientists from over 60 countries attributed considerably more objectivity, rationality, open-mindedness, intelligence, integrity, and communality to scientists than other highly-educated people. Moreover, scientists perceived even larger differences than lay people did. Some groups of scientists also differentiated between different categories of scientists: established scientists attributed higher levels of the scientific traits to established scientists than to early-career scientists and PhD students, and higher levels to PhD students than to early-career scientists. Female scientists attributed considerably higher levels of the scientific traits to female scientists than to male scientists. A strong belief in the storybook image and the (human) tendency to attribute higher levels of desirable traits to people in one’s own group than to people in other groups may decrease scientists’ willingness to adopt recently proposed practices to reduce error, bias and dishonesty in science.

My Unhappy Life as a Climate Heretic. By Roger Pielke Jr.

My Unhappy Life as a Climate Heretic. By Roger Pielke Jr.
My research was attacked by thought police in journalism, activist groups funded by billionaires and even the White House.http://www.wsj.com/articles/my-unhappy-life-as-a-climate-heretic-1480723518
Updated Dec. 2, 2016 7:04 p.m. ET

Much to my surprise, I showed up in the WikiLeaks releases before the election. In a 2014 email, a staffer at the Center for American Progress, founded by John Podesta in 2003, took credit for a campaign to have me eliminated as a writer for Nate Silver’s FiveThirtyEight website. In the email, the editor of the think tank’s climate blog bragged to one of its billionaire donors, Tom Steyer: “I think it’s fair [to] say that, without Climate Progress, Pielke would still be writing on climate change for 538.”

WikiLeaks provides a window into a world I’ve seen up close for decades: the debate over what to do about climate change, and the role of science in that argument. Although it is too soon to tell how the Trump administration will engage the scientific community, my long experience shows what can happen when politicians and media turn against inconvenient research—which we’ve seen under Republican and Democratic presidents.

I understand why Mr. Podesta—most recently Hillary Clinton’s campaign chairman—wanted to drive me out of the climate-change discussion. When substantively countering an academic’s research proves difficult, other techniques are needed to banish it. That is how politics sometimes works, and professors need to understand this if we want to participate in that arena.

More troubling is the degree to which journalists and other academics joined the campaign against me. What sort of responsibility do scientists and the media have to defend the ability to share research, on any subject, that might be inconvenient to political interests—even our own?

I believe climate change is real and that human emissions of greenhouse gases risk justifying action, including a carbon tax. But my research led me to a conclusion that many climate campaigners find unacceptable: There is scant evidence to indicate that hurricanes, floods, tornadoes or drought have become more frequent or intense in the U.S. or globally. In fact we are in an era of good fortune when it comes to extreme weather. This is a topic I’ve studied and published on as much as anyone over two decades. My conclusion might be wrong, but I think I’ve earned the right to share this research without risk to my career.

Instead, my research was under constant attack for years by activists, journalists and politicians. In 2011 writers in the journal Foreign Policy signaled that some accused me of being a “climate-change denier.” I earned the title, the authors explained, by “questioning certain graphs presented in IPCC reports.” That an academic who raised questions about the Intergovernmental Panel on Climate Change in an area of his expertise was tarred as a denier reveals the groupthink at work.

Yet I was right to question the IPCC’s 2007 report, which included a graph purporting to show that disaster costs were rising due to global temperature increases. The graph was later revealed to have been based on invented and inaccurate information, as I documented in my book “The Climate Fix.” The insurance industry scientist Robert-Muir Wood of Risk Management Solutions had smuggled the graph into the IPCC report. He explained in a public debate with me in London in 2010 that he had included the graph and misreferenced it because he expected future research to show a relationship between increasing disaster costs and rising temperatures.

When his research was eventually published in 2008, well after the IPCC report, it concluded the opposite: “We find insufficient evidence to claim a statistical relationship between global temperature increase and normalized catastrophe losses.” Whoops.

The IPCC never acknowledged the snafu, but subsequent reports got the science right: There is not a strong basis for connecting weather disasters with human-caused climate change.

Yes, storms and other extremes still occur, with devastating human consequences, but history shows they could be far worse. No Category 3, 4 or 5 hurricane has made landfall in the U.S. since Hurricane Wilma in 2005, by far the longest such period on record. This means that cumulative economic damage from hurricanes over the past decade is some $70 billion less than the long-term average would lead us to expect, based on my research with colleagues. This is good news, and it should be OK to say so. Yet in today’s hyper-partisan climate debate, every instance of extreme weather becomes a political talking point.

For a time I called out politicians and reporters who went beyond what science can support, but some journalists won’t hear of this. In 2011 and 2012, I pointed out on my blog and social media that the lead climate reporter at the New York Times,Justin Gillis, had mischaracterized the relationship of climate change and food shortages, and the relationship of climate change and disasters. His reporting wasn’t consistent with most expert views, or the evidence. In response he promptly blocked me from his Twitter feed. Other reporters did the same.

In August this year on Twitter, I criticized poor reporting on the website Mashable about a supposed coming hurricane apocalypse—including a bad misquote of me in the cartoon role of climate skeptic. (The misquote was later removed.) The publication’s lead science editor, Andrew Freedman, helpfully explained via Twitter that this sort of behavior “is why you’re on many reporters’ ‘do not call’ lists despite your expertise.”

I didn’t know reporters had such lists. But I get it. No one likes being told that he misreported scientific research, especially on climate change. Some believe that connecting extreme weather with greenhouse gases helps to advance the cause of climate policy. Plus, bad news gets clicks.

Yet more is going on here than thin-skinned reporters responding petulantly to a vocal professor. In 2015 I was quoted in the Los Angeles Times, by Pulitzer Prize-winning reporter Paige St. John, making the rather obvious point that politicians use the weather-of-the-moment to make the case for action on climate change, even if the scientific basis is thin or contested.

Ms. St. John was pilloried by her peers in the media. Shortly thereafter, she emailed me what she had learned: “You should come with a warning label: Quoting Roger Pielke will bring a hailstorm down on your work from the London Guardian, Mother Jones, and Media Matters.”

Or look at the journalists who helped push me out of FiveThirtyEight. My first article there, in 2014, was based on the consensus of the IPCC and peer-reviewed research. I pointed out that the global cost of disasters was increasing at a rate slower than GDP growth, which is very good news. Disasters still occur, but their economic and human effect is smaller than in the past. It’s not terribly complicated.

That article prompted an intense media campaign to have me fired. Writers at Slate, Salon, the New Republic, the New York Times, the Guardian and others piled on.

In March of 2014, FiveThirtyEight editor Mike Wilson demoted me from staff writer to freelancer. A few months later I chose to leave the site after it became clear it wouldn’t publish me. The mob celebrated. ClimateTruth.org, founded by former Center for American Progress staffer Brad Johnson, and advised by Penn State’s Michael Mann, called my departure a “victory for climate truth.” The Center for American Progress promised its donor Mr. Steyer more of the same.

Yet the climate thought police still weren’t done. In 2013 committees in the House and Senate invited me to a several hearings to summarize the science on disasters and climate change. As a professor at a public university, I was happy to do so. My testimony was strong, and it was well aligned with the conclusions of the IPCC and the U.S. government’s climate-science program. Those conclusions indicate no overall increasing trend in hurricanes, floods, tornadoes or droughts—in the U.S. or globally.

In early 2014, not long after I appeared before Congress, President Obama’s science adviser John Holdren testified before the same Senate Environment and Public Works Committee. He was asked about his public statements that appeared to contradict the scientific consensus on extreme weather events that I had earlier presented. Mr. Holdren responded with the all-too-common approach of attacking the messenger, telling the senators incorrectly that my views were “not representative of the mainstream scientific opinion.” Mr. Holdren followed up by posting a strange essay, of nearly 3,000 words, on the White House website under the heading, “An Analysis of Statements by Roger Pielke Jr.,” where it remains today.

I suppose it is a distinction of a sort to be singled out in this manner by the president’s science adviser. Yet Mr. Holdren’s screed reads more like a dashed-off blog post from the nutty wings of the online climate debate, chock-full of errors and misstatements.

But when the White House puts a target on your back on its website, people notice. Almost a year later Mr. Holdren’s missive was the basis for an investigation of me by Arizona Rep. Raul Grijalva, the ranking Democrat on the House Natural Resources Committee. Rep. Grijalva explained in a letter to my university’s president that I was being investigated because Mr. Holdren had “highlighted what he believes were serious misstatements by Prof. Pielke of the scientific consensus on climate change.” He made the letter public.

The “investigation” turned out to be a farce. In the letter, Rep. Grijalva suggested that I—and six other academics with apparently heretical views—might be on the payroll of Exxon Mobil (or perhaps the Illuminati, I forget). He asked for records detailing my research funding, emails and so on. After some well-deserved criticism from the American Meteorological Society and the American Geophysical Union, Rep. Grijalva deleted the letter from his website. The University of Colorado complied with Rep. Grijalva’s request and responded that I have never received funding from fossil-fuel companies. My heretical views can be traced to research support from the U.S. government.

But the damage to my reputation had been done, and perhaps that was the point. Studying and engaging on climate change had become decidedly less fun. So I started researching and teaching other topics and have found the change in direction refreshing. Don’t worry about me: I have tenure and supportive campus leaders and regents. No one is trying to get me fired for my new scholarly pursuits.

But the lesson is that a lone academic is no match for billionaires, well-funded advocacy groups, the media, Congress and the White House. If academics—in any subject—are to play a meaningful role in public debate, the country will have to do a better job supporting good-faith researchers, even when their results are unwelcome. This goes for Republicans and Democrats alike, and to the administration of President-elect Trump.

Academics and the media in particular should support viewpoint diversity instead of serving as the handmaidens of political expediency by trying to exclude voices or damage reputations and careers. If academics and the media won’t support open debate, who will?

---
Mr. Pielke is a professor and director of the Sports Governance Center at the University of Colorado, Boulder. His most recent book is “The Edge: The Wars Against Cheating and Corruption in the Cutthroat World of Elite Sports” (Roaring Forties Press, 2016).

The Value of Prospective Reasoning for Close Relationships

this is not only useful for close relationships:

 

The Value of Prospective Reasoning for Close Relationships

1. Alex C. Huynh1⇑
2. Daniel Y.-J. Yang2
3. Igor Grossmann1

1. ¹Department of Psychology, University of Waterloo, Waterloo, Ontario, Canada
2. ²Child Study Center, Yale University, New Haven, CT, USA

1. Alex C. Huynh or Igor Grossmann, Department of Psychology, University of Waterloo, 200 University Avenue West, Waterloo, Ontario, Canada N2L 3G1. Emails: alex.huynh@uwaterloo.ca; igrossma@uwaterloo.ca

Abstract

http://spp.sagepub.com/content/early/2016/07/27/1948550616660591.abstract

We examined how adopting a future (vs. present)-oriented perspective when reflecting on a relationship conflict impacts the process of reasoning and relationship well-being. Across two studies, participants instructed to think about how they would feel in the future (vs. present) expressed more adaptive reasoning over a relationship conflict—low partner blame, greater insight, and greater forgiveness, which was then associated with greater relationship well-being—for example, more positive versus negative emotions about the relationship and expectations that the relationship will grow. These findings were driven by a decrease in person-centered language when reflecting on the conflict. Implications for understanding how tempo

The Great Recession Blame Game - Banks took the heat, but it was Washington that propped up subprime debt and then stymied recovery

The Great Recession Blame Game

Banks took the heat, but it was Washington that propped up subprime debt and then stymied recovery.

By Phil Gramm and Michael Solon
WSJ, April 15, 2016 6:09 p.m. ET

When the subprime crisis broke in the 2008 presidential election year, there was little chance for a serious discussion of its root causes. Candidate Barack Obama weaponized the crisis by blaming greedy bankers, unleashed when financial regulations were “simply dismantled.” He would go on to blame them for taking “huge, reckless risks in pursuit of quick profits and massive bonuses.”
That mistaken diagnosis was the justification for the Dodd-Frank Act and the stifling regulations that shackled the financial system, stunted the recovery and diminished the American dream.

In fact, when the crisis struck, banks were better capitalized and less leveraged than they had been in the previous 30 years. The FDIC’s reported capital-to-asset ratio for insured commercial banks in 2007 was 10.2%—76% higher than it was in 1978. Federal Reserve data on all insured financial institutions show the capital-to-asset ratio was 10.3% in 2007, almost double its 1984 level, and the biggest banks doubled their capitalization ratios. On Sept. 30, 2008, the month Lehman failed, the FDIC found that 98% of all FDIC institutions with 99% of all bank assets were “well capitalized,” and only 43 smaller institutions were undercapitalized.

In addition, U.S. banks were by far the best-capitalized banks in the world. While the collapse of 31 million subprime mortgages fractured financial capital, the banking system in the 30 years before 2007 would have fared even worse under such massive stress.

Virtually all of the undercapitalization, overleveraging and “reckless risks” flowed from government policies and institutions. Federal regulators followed international banking standards that treated most subprime-mortgage-backed securities as low-risk, with lower capital requirements that gave banks the incentive to hold them. Government quotas forced Fannie Mae and Freddie Mac to hold ever larger volumes of subprime mortgages, and politicians rolled the dice by letting them operate with a leverage ratio of 75 to one—compared with Lehman’s leverage ratio of 29 to one.

Regulators also eroded the safety of the financial system by pressuring banks to make subprime loans in order to increase homeownership. After eight years of vilification and government extortion of bank assets, often for carrying out government mandates, it is increasingly clear that banks were more scapegoats than villains in the subprime crisis.

Similarly, the charge that banks had been deregulated before the crisis is a myth. From 1980 to 2007 four major banking laws—the Competitive Equality Banking Act (1987), the Financial Institutions, Reform, Recovery and Enforcement Act (1989), the Federal Deposit Insurance Corporation Improvement Act (1991), and Sarbanes-Oxley (2002)—undeniably increased bank regulations and reporting requirements. The charge that financial regulation had been dismantled rests almost solely on the disputed effects of the 1999 Gramm-Leach-Bliley Act (GLBA).

Prior to GLBA, the decades-old Glass-Steagall Act prohibited deposit-taking, commercial banks from engaging in securities trading. GLBA, which was signed into law by President Bill Clinton, allowed highly regulated financial-services holding companies to compete in banking, insurance and the securities business. But each activity was still required to operate separately and remained subject to the regulations and capital requirements that existed before GLBA. A bank operating within a holding company was still subject to Glass-Steagall (which was not repealed by GLBA)—but Glass-Steagall never banned banks from holding mortgages or mortgage-backed securities in the first place.

GLBA loosened federal regulations only in the narrow sense that it promoted more competition across financial services and lowered prices. When he signed the law, President Clinton said that “removal of barriers to competition will enhance the stability of our financial system, diversify their product offerings and thus their sources of revenue.” The financial crisis proved his point. Financial institutions that had used GLBA provisions to diversify fared better than those that didn’t.

Mr. Clinton has always insisted that “there is not a single solitary example that [GLBA] had anything to do with the financial crisis,” a conclusion that has never been refuted. When asked by the New York Times in 2012, Sen. Elizabeth Warren agreed that the financial crisis would not have been avoided had GLBA never been adopted. And President Obama effectively exonerated GLBA from any culpability in the financial crisis when, with massive majorities in both Houses of Congress, he chose not to repeal GLBA. In fact, Dodd-Frank expanded GLBA by using its holding-company structure to impose new regulations on systemically important financial institutions.

Another myth of the financial crisis is that the bailout was required because some banks were too big to fail. Had the government’s massive injection of capital—the Troubled Asset Relief Program, or TARP—been only about bailing out too-big-to-fail financial institutions, at most a dozen institutions might have received aid. Instead, 954 financial institutions received assistance, with more than half the money going to small banks.

Many of the largest banks did not want or need aid—and Lehman’s collapse was not a case of a too-big-to-fail institution spreading the crisis. The entire financial sector was already poisoned by the same subprime assets that felled Lehman. The subprime bailout occurred because the U.S. financial sector was, and always should be, too important to be allowed to fail.

Consider that, according to the Congressional Budget Office, bailing out the depositors of insolvent S&Ls in the 1980s on net cost taxpayers $258 billion in real 2009 dollars. By contrast, of the $245 billion disbursed by TARP to banks, 67% was repaid within 14 months, 81% within two years and the final totals show that taxpayers earned $24 billion on the banking component of TARP. The rapid and complete payback of TARP funds by banks strongly suggests that the financial crisis was more a liquidity crisis than a solvency crisis.

What turned the subprime crisis and ensuing recession into the “Great Recession” was not a failure of policies that addressed the financial crisis. Instead, it was the failure of subsequent economic policies that impeded the recovery.

The subprime crisis was largely the product of government policy to promote housing ownership and regulators who chose to promote that social policy over their traditional mission of guaranteeing safety and soundness. But blaming the financial crisis on reckless bankers and deregulation made it possible for the Obama administration to seize effective control of the financial system and put government bureaucrats in the corporate boardrooms of many of the most significant U.S. banks and insurance companies.

Suffocating under Dodd-Frank’s “enhanced supervision,” banks now focus on passing stress tests, writing living wills, parking capital at the Federal Reserve, and knowing their regulators better than they know their customers. But their ability to help the U.S. economy turn dreams into businesses and jobs has suffered.

In postwar America, it took on average just 2 1/4 years to regain in each succeeding recovery all of the real per capita income that had been lost in the previous recession. At the current rate of the Obama recovery, it will take six more years, 14 years in all, for the average American just to earn back what he lost in the last recession. Mr. Obama’s policies in banking, health care, power generation, the Internet and so much else have Europeanized America and American exceptionalism has waned—sadly proving that collectivism does not work any better in America than it has ever worked anywhere else.

Mr. Gramm, a former chairman of the Senate Banking Committee, is a visiting scholar at the American Enterprise Institute. Mr. Solon is a partner of US Policy Metrics.

 

A New Tool for Avoiding Big-Bank Failures: ‘Chapter 14.’ By Emily C. Kapur and John B. Taylor

Bernie Sanders is right, Dodd-Frank doesn’t work, but his solution is wrong. Here’s what would work.

WSJ, Mar 11, 2016

http://www.wsj.com/articles/a-new-tool-for-avoiding-big-bank-failures-chapter-14-1457654027

For months Democratic presidential hopeful Bernie Sanders has been telling Americans that the government must “break up the banks” because they are “too big to fail.” This is the wrong role for government, but Sen. Sanders and others on both sides of the aisle have a point. The 2010 Dodd-Frank financial law, which was supposed to end too big to fail, has not.

Dodd-Frank gave the Federal Deposit Insurance Corp. authority to take over and oversee the reorganization of so-called systemically important financial institutions whose failure could pose a risk to the economy. But no one can be sure the FDIC will follow its resolution strategy, which leads many to believe Dodd-Frank will be bypassed in a crisis.

Reflecting on his own experience as overseer of the U.S. Treasury’s bailout program in 2008-09, Neel Kashkari, now president of the Federal Reserve Bank of Minneapolis, says government officials are once again likely to bail out big banks and their creditors rather than “trigger many trillions of additional costs to society.”

The solution is not to break up the banks or turn them into public utilities. Instead, we should do what Dodd-Frank failed to do: Make big-bank failures feasible without tanking the economy by writing a process to do so into the bankruptcy code through a new amendment—a “chapter 14.”

Chapter 14 would impose losses on shareholders and creditors while preventing the collapse of one firm from spreading to others. It could be initiated by the lead regulatory agency and would begin with an over-the-weekend bankruptcy hearing before a pre-selected U.S. district judge. After the hearing, the court would convert the bank’s eligible long-term debt into equity, reorganizing the bankrupt bank’s balance sheet without restructuring its operations.

A new non-bankrupt company, owned by the bankruptcy estate (the temporary legal owner of a failed company’s assets and property), would assume the recapitalized balance sheet of the failed bank, including all obligations to its short-term creditors. But the failed bank’s shareholders and long-term bondholders would have claims only against the estate, not the new company.

The new firm would take over the bank’s business and be led by the bankruptcy estate’s chosen private-sector managers. With regulations requiring minimum long-term debt levels, the new firm would be solvent. The bankruptcy would be entirely contained, both because the new bank would keep operating and paying its debts, and because losses would be allocated entirely to the old bank’s shareholders and long-term bondholders.

An examination by one of us (Emily Kapur) of previously unexplored discovery and court documents from Lehman Brothers’ September 2008 bankruptcy shows that chapter 14 would have worked especially well for that firm, without adverse effects on the financial system.

Here is how Lehman under chapter 14 would have played out. The process would start with a single, brief hearing for the parent company to facilitate the creation of a new recapitalized company—a hearing in which the judge would have minimal discretion. By contrast, Lehman’s actual bankruptcy involved dozens of complex proceedings in the U.S. and abroad, creating huge uncertainty and making it impossible for even part of the firm to remain in business.

When Lehman went under it had $20 billion of book equity and $96 billion of long-term debt, while its perceived losses were around $54 billion. If the costs of a chapter 14 proceeding amounted to an additional (and conservative) $10 billion, then the new company would be well capitalized with around $52 billion of equity.

The new parent company would take over Lehman’s subsidiaries, all of which would continue in business, outside of bankruptcy. And the new company would honor all obligations to short-term creditors, such as repurchase agreement and commercial paper lenders.

The result: Short-term creditors would have no reason to run on the bank before the bankruptcy proceeding, knowing they would be protected. And they would have no reason to run afterward, because the new firm would be solvent.

Without a run, Lehman would have $30 billion more liquidity after resolution than it had in 2008, easing subsequent operational challenges. In the broader marketplace, money-market funds would have no reason to curtail lending to corporations, hedge funds would not flee so readily from prime brokers, and investment banks would be less likely to turn to the government for financing.

Eventually, the new company would make a public stock offering to value the bankruptcy estate’s ownership interest, and the estate would distribute its assets according to statutory priority rules. If the valuation came in at $52 billion, Lehman shareholders would be wiped out, as they were in 2008. Long-term debtholders, with $96 billion in claims, would recover 54 cents on the dollar, more than the 37 cents they did receive. All other creditors—the large majority—would be paid in full at maturity.

Other reforms, such as higher capital requirements, may yet be needed to reduce risk and lessen the chance of financial failure. But that is no reason to wait on bankruptcy reform. A bill along the lines of the chapter 14 that we advocate passed the House Judiciary Committee on Feb. 11. Two versions await action in the Senate. Let’s end too big to fail, once and for all.
 
Ms. Kapur is an attorney and economics Ph.D. candidate at Stanford University. Mr. Taylor, a professor of economics at Stanford, co-edited “Making Failure Feasible” (Hoover, 2015) with Kenneth Scott and Thomas Jackson, which includes Ms. Kapur’s study.