Bill Gates: "We haven't chosen to get behind [vouchers] in a big way [...] because the negativity about them is very, very high"

Was the $5 Billion Worth It? By Jason Riley
A decade into his record-breaking education philanthropy, Bill Gates talks teachers, charters—and regrets.
WSJ, Jul 23, 2011
http://online.wsj.com/article/SB10001424053111903554904576461571362279948.html

Seattle

'It's hard to improve public education—that's clear. As Warren Buffett would say, if you're picking stocks, you wouldn't pick this one." Ten years into his record-breaking philanthropic push for school reform, Bill Gates is sober—and willing to admit some missteps.

"It's been about a decade of learning," says the Microsoft co-founder whose Bill and Melinda Gates Foundation is now the nation's richest charity. Its $34 billion in assets is more than the next three largest foundations (Ford, Getty and Robert Wood Johnson) combined, and in 2009 it handed out $3 billion, or $2 billion more than any other donor. Since 2000, the foundation has poured some $5 billion into education grants and scholarships.

Seated in his office at the new Gates Foundation headquarters located hard by the Emerald City's iconic Space Needle, Mr. Gates says that education isn't only a civil-rights issue but also "an equity issue and an economic issue. . . . It's so primary. In inner-city, low-income communities of color, there's such a high correlation in terms of educational quality and success."

One of the foundation's main initial interests was schools with fewer students. In 2004 it announced that it would spend $100 million to open 20 small high schools in San Diego, Denver, New York City and elsewhere. Such schools, says Mr. Gates, were designed to—and did—promote less acting up in the classroom, better attendance and closer interaction with adults.

"But the overall impact of the intervention, particularly the measure we care most about—whether you go to college—it didn't move the needle much," he says. "Maybe 10% more kids, but it wasn't dramatic. . . . We didn't see a path to having a big impact, so we did a mea culpa on that." Still, he adds, "we think small schools were a better deal for the kids who went to them."

The reality is that the Gates Foundation met the same resistance that other sizeable philanthropic efforts have encountered while trying to transform dysfunctional urban school systems run by powerful labor unions and a top-down government monopoly provider.

In the 1970s, the Ford, Carnegie and Rockefeller foundations, among others, pushed education "equity" lawsuits in California, New Jersey, Texas and elsewhere that led to enormous increases in state expenditures for low-income students. In 1993, the publishing mogul Walter Annenberg, hoping to "startle" educators and policy makers into action, gave a record $500 million to nine large city school systems. Such efforts made headlines but not much of a difference in closing the achievement gap.

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Martin Kozlowski
 .Asked to critique these endeavors, Mr. Gates demurs: "I applaud people for coming into this space, but unfortunately it hasn't led to significant improvements." He also warns against overestimating the potential power of philanthropy. "It's worth remembering that $600 billion a year is spent by various government entities on education, and all the philanthropy that's ever been spent on this space is not going to add up to $10 billion. So it's truly a rounding error."

This understanding of just how little influence seemingly large donations can have has led the foundation to rethink its focus in recent years. Instead of trying to buy systemic reform with school-level investments, a new goal is to leverage private money in a way that redirects how public education dollars are spent.

"I bring a bias to this," says Mr. Gates. "I believe in innovation and that the way you get innovation is you fund research and you learn the basic facts." Compared with R&D spending in the pharmaceutical or information-technology sectors, he says, next to nothing is spent on education research. "That's partly because of the problem of who would do it. Who thinks of it as their business? The 50 states don't think of it that way, and schools of education are not about research. So we come into this thinking that we should fund the research."


Of late, the foundation has been working on a personnel system that can reliably measure teacher effectiveness. Teachers have long been shown to influence students' education more than any other school factor, including class size and per-pupil spending. So the objective is to determine scientifically what a good instructor does.

"We all know that there are these exemplars who can take the toughest students, and they'll teach them two-and-a-half years of math in a single year," he says. "Well, I'm enough of a scientist to want to say, 'What is it about a great teacher? Is it their ability to calm down the classroom or to make the subject interesting? Do they give good problems and understand confusion? Are they good with kids who are behind? Are they good with kids who are ahead?'

"I watched the movies. I saw 'To Sir, With Love,'" he chuckles, recounting the 1967 classic in which Sidney Poitier plays an idealistic teacher who wins over students at a roughhouse London school. "But they didn't really explain what he was doing right. I can't create a personnel system where I say, 'Go watch this movie and be like him.'"

Instead, the Gates Foundation's five-year, $335-million project examines whether aspects of effective teaching—classroom management, clear objectives, diagnosing and correcting common student errors—can be systematically measured. The effort involves collecting and studying videos of more than 13,000 lessons taught by 3,000 elementary school teachers in seven urban school districts.

"We're taking these tapes and we're looking at how quickly a class gets focused on the subject, how engaged the kids are, who's wiggling their feet, who's looking away," says Mr. Gates. The researchers are also asking students what works in the classroom and trying to determine the usefulness of their feedback.

Mr. Gates hopes that the project earns buy-in from teachers, which he describes as key to long-term reform. "Our dream is that in the sample districts, a high percentage of the teachers determine that this made them better at their jobs." He's aware, though, that he'll have a tough sell with teachers unions, which give lip service to more-stringent teacher evaluations but prefer existing pay and promotion schemes based on seniority—even though they often end up matching the least experienced teachers with the most challenging students.

Teachers unions can be counted on "to stick up for the status quo," he says, but he believes they can be nudged in the right direction. "It's kind of scary for them because what we're saying is that some of these people shouldn't be teachers. So, does the club stand for sticking up for its least capable member or does it stand for excellence in education? We'll, it kind of stands for both."

Asked if the National Education Association and the American Federation of Teachers have any incentive to back school reforms that help kids but also diminish union power, Mr. Gates responds by questioning the scope of that power. "We have heavy union states and heavy right-to-work states, and the educational achievement of K-12 students is not at all predicted by how strong the union rules are," he says. "If I saw that [right-to-work states like] Texas and Florida were running a great K-12 system, but [heavy union states like] New York and Massachusetts have really messed this up, then I could draw a correlation and say it's either got to be the union—or the weather."

Mr. Gates's foundation strongly supports a uniform core curriculum for schools. "It's ludicrous to think that multiplication in Alabama and multiplication in New York are really different," he says. He also sees common standards as a money-saver at a time when many states are facing budget shortfalls. "In terms of mathematics textbooks, why can't you have the scale of a national market? Right now, we have a Texas textbook that's different from a California textbook that's different from a Massachusetts textbook. That's very expensive."

A national core curriculum, detractors say, could force states with superior standards, like Massachusetts, to dumb down their systems. And even if good common standards could be established, how would they improve going forward if our 50-state laboratory is no longer in operation?

Mr. Gates responds to that by saying there's no need to sacrifice excellence for equity. "Behind this core curriculum are some very deep insights. American textbooks were twice as thick as Asian textbooks. In American math classes, we teach a lot of concepts poorly over many years. In the Asian systems they teach you very few concepts very well over a few years." Nor does he see the need for competition among state standards. "This is like having a common electrical system. It just makes sense to me."

On the fraught issue of school choice, his foundation has been a strong advocate of charter schools, and Mr. Gates is particularly fond of the KIPP charter network and its focus on serving inner-city neighborhoods. "Whenever you get depressed about giving money in this area," he volunteers, "you can spend a day in a KIPP school and know that they are spending less money than the dropout factory down the road."

Mr. Gates is less enamored of school vouchers. "Some in the Walton family"—of Wal-Mart fame—"have been very big on vouchers," he begins. "And honestly, if we thought there would be broad acceptance in some locales and long-term commitment to do them, they have some very positive characteristics."

He praises the private school model for its efficiency vis-à-vis traditional public schools, noting that the "parochial school system, per dollar spent, is an excellent school system." But the politics, he says, are just too tough right now. "We haven't chosen to get behind [vouchers] in a big way, as we have with personnel systems or charters, because the negativity about them is very, very high."


It's a response that in some ways encapsulates the Gates Foundation's approach to education reform—more evolution, less disruption. It attempts to do as much good as possible without upsetting too many players. You can quibble with Mr. Gates about that strategy. You can second-guess him. You can even offer free advice. Or you can shake his hand, thank him for his time and remember that it's his money.


Mr. Riley is a member of the Journal's editorial board.

Basel Committee: Assessment methodology and the additional loss absorbency requirement for global systemically important banks

Assessment methodology and the additional loss absorbency requirement for global systemically important banks - consultative document issued by the Basel Committee
July 19, 2011

http://www.bis.org/press/p110719.htm

The Basel Committee on Banking Supervision issued on July 19, 2011 a consultative document on Global systemically important banks: Assessment methodology and the additional loss absorbency requirement.

At its June 25, 2011 meeting, the Group of Governors and Heads of Supervision (GHOS), the oversight body of the Basel Committee, agreed on the consultative document setting out measures for global systemically important banks (G-SIBs). These measures include the methodology for assessing systemic importance, the additional required loss absorbency and the arrangements by which they will be phased in.

Following the agreement, the GHOS submitted this consultative document to the Financial Stability Board (FSB), which is coordinating the overall set of measures to reduce the moral hazard posed by global systemically important financial institutions. The package including this consultative document was endorsed for publication at the FSB Plenary meeting on July 18, 2011.

The assessment methodology for G-SIBs is based on an indicator-based approach and comprises five broad categories: size, interconnectedness, lack of substitutability, global (cross-jurisdictional) activity and complexity.

Based on the current results of applying the assessment methodology, 28 banks would be subject to the additional loss absorbency requirement due to their global systemic importance. It should be noted that this number will likely evolve over time as banks change their behaviour in response to the incentives of the G-SIB framework. Moreover, the Basel Committee will address any outstanding data issues and re-run the proposed assessment methodology using updated data well in advance of the implementation date.

The additional loss absorbency requirements are to be met with a progressive Common Equity Tier 1 (CET1) capital requirement ranging from 1% to 2.5%, depending on a bank's systemic importance. To provide a disincentive for banks facing the highest charge to increase materially their global systemic importance in the future, an additional 1% loss absorbency would be applied in such circumstances.

The higher loss absorbency requirements will be introduced in parallel with the Basel III capital conservation and countercyclical buffers, ie between Jan 1, 2016 and year end 2018 becoming fully effective on Jan 1, 2019.

Mr Stefan Ingves, Chairman of the Basel Committee on Banking Supervision and Governor of Sveriges Riksbank, noted that "the rationale for the policy measures proposed today is to deal with the cross-border negative externalities created by global systemically important banks which current regulatory policies do not fully address. The proposed measures will enhance the going-concern loss absorbency of global systemically important banks and reduce the probability of their failure. Along with the measures announced today by the Financial Stability Board, they will contribute to a safer and sounder banking and financial system".

A New Model for Corporate Boards - Companies have too many directors, and not enough of them have experience in the firm's main line of business

A New Model for Corporate Boards. By ROBERT C. POZEN
Companies have too many directors, and not enough of them have experience in the firm's main line of business.
The Wall Street Journal, Thursday, December 30, 2010
http://online.wsj.com/article/SB10001424052748703581204576033430665661032.html


In 2002, Congress passed the Sarbanes-Oxley Act to prevent corporate governance debacles like Enron and WorldCom from happening again. But six years later, many of the largest U.S. institutions had to be rescued by massive federal assistance. All of these institutions were Sarbox-compliant: Most members of their boards were independent, and their auditors' reports showed no material weaknesses in internal controls. So why were the reforms so ineffective?

I believe that the problem is the current structure of corporate boards. In short, they are too big, members often don't have enough relevant experience, and they put too much emphasis on procedure. Complex global companies need a new model. Boards should be comprised of a small group of people with enough pertinent experience and sufficient time to hold management accountable.

The average board size for companies in the S&P 500 was almost 11 in 2009. In groups this large, individual members engage in what psychologists call "social loafing." Instead of taking personal responsibility for the group's actions, they rely on others to take the lead.

Psychologists such as Harvard's Richard Hackman suggest that groups of six or seven are the most effective at decision-making. Groups of this size are small enough for all members to take personal responsibility for the group's actions. They also can take decisive action more quickly than a large board.

Although the Citigroup board in 2007 was filled with many luminaries, only one of the independent directors had ever worked for a financial-services firm. Of course, every board needs a generalist to provide a broad perspective and an accounting expert to head the audit committee. But the rest should have experience in the company's main line of business.

Most boards meet in person every other month for one day, plus conference calls between meetings. That simply isn't enough time to keep abreast of the global operations of a large company. An effective outside director should spend at least two days per month on company business between board meetings. Accordingly, independent directors should be restricted to serving on just two boards of public companies.

In all three respects, this model represents a significant departure from current board practice. Here are some pre-emptive answers to questions that will likely arise from my proposal:

When it comes to finding people with relevant experience, those most qualified to be professional directors often are working for the company's competitors. They obviously couldn't serve on a competitor's board due to conflicts of interest and antitrust concerns. As a result, most independent directors will have to be retired company executives (but not of the company in question). Many executives retire around age 60 in good health and want to continue to work, preferably on a part-time basis. They should serve as directors as long as they are capable, without a requirement for mandatory retirement at 70.

The average compensation of directors in S&P 500 companies is currently $213,000 per year. In this new model, professional directors would be putting in roughly twice the hours, so their total compensation should be approximately $400,000 per year.

To align the interests of professional directors with those of long-term shareholders, these directors should receive 75% of their total compensation in shares, subject to two conditions. First, these shares would vest in equal parts over four years. Second, at least half of the shares would have to be held until retirement.

Since professional independent directors will be more active in supervising the business of the company, will they become subject to increased legal liabilities? For example, if the head of a particular company's audit committee learns a lot about that company's finances, will he or she be personally liable if its financial statements contain material misrepresentations? No. Under federal securities laws, unless the audit head knew of these misrepresentations or recklessly disregarded them, he or she would not be liable.

Under state laws, state courts will override the business judgment of independent directors only if they do not act "in good faith." Because professional directors will be more diligent than today's norm, they will be in a particularly strong position to show that they acted "in good faith."

The most serious objection to my proposed model will probably be the concern that it could blur the distinction between the roles of the board and management. A board of directors has specific duties such as selecting the CEO, plus more general duties such as setting strategic goals. But the board is not supposed to get involved in day-to-day company management.

Although the new model will give greater power to professional directors, it would not empower them to cross the line into the day-to-day operations. Between board meetings, for example, professional directors would talk with managers to better understand the key decisions underlying the company's financial statements and the actual impact of its compensation policies. These sessions wouldn't amount to micromanagement. Instead, they would ensure that critical issues were fully addressed by the relevant board committees.

This new model could get adopted in several ways. First, bank regulators could use their "safety and soundness" authority to force troubled banks to elect professional directors. Second, activist shareholders might join together to pressure a poorly performing company into adopting this model. Finally, a few boards of large companies might be willing to try it out and see how it works.

Regulators, investors and directors should recognize that we do not need more procedures for corporate boards. Instead, we need more expert directors who view their board services as their primary profession—not an avocation.

Mr. Pozen is chairman emeritus of MFS Investment Management and a senior lecturer at Harvard Business School. This op-ed was adapted from an article appearing in the December 2010 issue of the Harvard Business Review.

Macroeconomic Effects of Public Pension Reforms - Net Effect is Positive

Macroeconomic Effects of Public Pension Reforms. By Karam, Philippe D ; Muir, Dirk ; Pereira, Joana ; Tuladhar, Anita
IMF Working Paper No. 10/297
Dec 22, 2010

Excerpts with no footnotes:

INTRODUCTION
The fiscal impact of the global crisis has reinforced the urgency of pension and health entitlement reform.2 Staff projections suggest that age-related outlays (pensions and health spending) will rise by 4 to 5 percent of GDP in the advanced economies over the next 20 years, underscoring the need to take steps to stabilize these outlays in relation to GDP. With the economic recovery not yet fully established, this paper emphasizes their short-run macro impact in order to address concerns that these reforms can undermine short-run growth.3

We examine the preferred set of public pension reforms using the IMF's Global Integrated Monetary and Fiscal (GIMF) model parameterized on data for five regions as representing the entire world. We consider three policy reform options relating to pay-as-you-go public pension systems that are commonly discussed in the literature. This analytical framework allows us to approximately gauge the effects of these reforms on labor and capital markets and growth in the short and long run.4 (i) Raising the retirement age: this reduces lifetime benefits paid to pensioners. Encouraging longer working lives with higher earned income may lead to a reduction in saving and increase in consumption during working years. In addition, increased fiscal saving will have long-run positive effects on output through lowering the cost of capital and crowding in investment. (ii) Reducing pension benefits: this increases agents‘ incentives to raise savings in order to avoid a sharper reduction in income and consumption in retirement. It would reduce consumption in the short to medium run, but would increase investment over the long run. (iii) Increasing contribution rates: this leads to distortionary supply-side effects for labor, which combined with a negative aggregate demand on real disposable income, depresses real activity in both the short and long run.

We assess how the policies compare in attaining the twin goals of strong, sustainable, and balanced growth and fiscal stability (i.e., stabilizing the debt-to-GDP ratio against rising pension entitlements). The key results show that increasing the retirement age has the largest impact on growth compared to reducing benefits, while increasing contribution rates as approximated by an increase in taxes on labor income has the least favorable effect on output. Besides boosting domestic demand in the short run, lengthening working lives of employees reduces the pressure on governments to cut pension benefits significantly or to raise payroll and labor income taxes. Reducing such benefits can lead to an increase in private savings and an unwarranted weakening of a fragile domestic demand in the short run, while raising taxes can distort incentives to supply labor. We also found that if regions cooperate in pursuing fiscal reform, the impact will be greater than if only one or some of the regions in the world undertake reform separately. In all, early and resolute action to reduce future age-related spending or finance the spending could improve fiscal sustainability over the medium run, significantly more if such reforms are enacted in a cooperative fashion.

[...]

CONCLUSION

We considered reforms to the pension system that can help ensure the long-run viability of public finances, while mindful of their short-run effect on economic activity in the midst of a global financial crisis. This is carried out within a dynamic general equilibrium model (GIMF) that captures the important economic interrelationships at a national and international level. We emphasized measures to contain and fund the rising costs of age-related spending in the medium to long run. We find that reforms which lead to short-run adverse effects on real GDP (i.e., benefit reductions) are largely outweighed by the benefits of declining real interest rates and the positive effect on future potential productive capacity. The reform which has the most positive effects in the long run is lengthening the working lives of employees, effectively raising the size of the active labor force relative to the retiree population. It helps boost domestic demand in the short run but also eases off the pressure on governments to cut pension benefits alone—which can lead to additional private savings and cause fragile domestic demand to fall in the short run—or to raise payroll and labor income taxes—which can distort incentives to supply labor. We also found that the impact on real GDP of a cooperative approach to age-related fiscal reforms is greater compared to a case where one but not all regions undertake reform.

In terms of public finances, our results generally show that stabilizing the GDP share of age-related expenditures leads to a sizable decline in the debt-to-GDP ratio. Early efforts and resolute action to reduce future age-related spending or finance the spending through additional tax increases and other measures (preferably through an increase in retirement age) could significantly improve fiscal sustainability in several countries over the medium run, and more so if such reforms are enacted in a cooperative fashion.

Link: http://www.imf.org/external/pubs/cat/longres.cfm?sk=24536.0

Utopia, With Tears - A review of Fruitlands, by Richard Francis

Utopia, With Tears. By ALEXANDRA MULLEN
No meat, no wool, no coffee or candles to read by, but plenty of high aspirations—and trouble.A review of Fruitlands, by Richard Francis (Yale University Press, 321 pages, $30)

WSJ, Friday, October 29, 2010
http://online.wsj.com/article/SB10001424052702304173704575578761068904960.html


In 1843, in the quiet middle of Massachusetts, a group of high-minded people set out to create a new Eden they called Fruitlands. The embryonic community miscarried, lasting only seven months, from June to January. Fruitlands now has a new chronicler in Richard Francis, a historian of 19th-century America. "This is the story," he writes, "of one of history's most unsuccessful utopias ever—but also one of the most dramatic and significant." As we learn in his thorough and occasionally hilarious account, the claim is about half right.

The utopian community of Fruitlands had two progenitors: the American idealist Bronson Alcott and the English socialist Charles Lane. Alcott was a farm boy from Connecticut who had turned from the plough to philosophy. According to Ralph Waldo Emerson, his friend, Alcott could not chat about anything "less than A New Solar System & the prospective Education in the nebulae." Airy as his thoughts were, Alcott could be a mesmerizing speaker. Indeed, his words partly inspired an experimental community in England, where he met Lane.

Lane has often been considered the junior partner in the Fruitlands story, merely the guy who put up the money (for roughly 100 acres, only 11 of which were arable). But Mr. Francis fleshes him out, showing him to be a tidier and more bitter thinker than Alcott, with a practical streak that could be overrun by his hopes for humanity.

As Mr. Francis notes, Alcott and Lane shared a "tendency to take moderation to excess," pushing their first principles as far as they could go. One such principle was that you should do no harm to living things, including plants. As Mr. Francis explains: "If you cut a cabbage or lift a potato you kill the plant itself, just as you kill an animal in order to eat its meat. But pluck an apple, and you leave the tree intact and healthy."

The Fruitlands community never numbered more than 14 souls, five of them children. The members included a nudist, a former inmate of an insane asylum, and a man who had once gotten into a knife fight to defend his right to wear a beard. Then there was the fellow who thought swearing elevated the spirit. He would greet the Alcott girls: "Good morning, damn you." Lane thought the members should be celibate; Alcott's wife, Abigail, the mother of his four daughters and the sole permanent woman resident, was a living reproach to this view.

All of Fruitlands members, however, agreed to certain restrictions: No meat or fish; in fact nothing that came from animals, so no eggs and no milk. No leather or wool, and no whale oil for lamps or candles made from tallow (rendered animal fat). No stimulants such as coffee or tea, and no alcohol. Because the Fruitlanders were Abolitionists, cane sugar and cotton were forbidden (slave labor produced both). The members of the community wore linen clothes and canvas shoes. The library was stocked with a thousand books, but no one could read them after dark.

And how did the whole experiment go? Well, most of the men at Fruitlands had little farming experience. Alcott, who did, impressed Lane with his ability to plow a straight furrow; but Alcott was always a better talker than worker. The community rejected animal labor—and even manure, a serious disadvantage if you want to produce enough food to be self-sufficient. The farming side of Fruitlands was a dud.

But the experiment was indeed, as Mr. Francis claims, "dramatic." The drama came from a common revolutionary trajectory in which "a group of idealists ends by trying to destroy each other." "Of spiritual ties she knows nothing," Lane wrote of Abigail. "All Mr. Lane's efforts have been to disunite us," she confided to a friend, referring to her relations with Bronson. Even the usually serene Bronson agonized: "Can a man act continually for the universal end," he asked Lane, "while he cohabits with a wife?" By Christmas, which he spent in Boston, Bronson seemed on the verge of dissolving his family. In the new year he returned to Fruitlands, but he had a breakdown. This was no way to run a utopia, and the experiment ended.

Was Fruitlands "significant"? In Mr. Francis's reading, the community "intuited the interconnectedness of all living things." That intuition, he believes, underlies our notions of the evils of pollution and the imminence of environmental catastrophe, as well as our concerns about industrialized farming. The Fruitlanders' understanding of the world, he argues, helped create a parallel universe—an alternative to scientific empiricism—that is still humming along in the current day.

Perhaps so. Certainly many New Age and holistic notions, in their fuzzy and well-meaning romanticism, share a common ancestor with the Fruitlands outlook. But the result is not always benign. It was the Fruitlanders' belief, for instance, that "all disease originates in the soul." One descendant of this idea is the current loathsome view that cancer is caused by bad thoughts.

Though obviously sympathetic to the Fruitlands experiment, Mr. Francis gives us enough facts to let us draw our own conclusions. He records Bronson and Abigail's acts of charity, already familiar to us from their daughter Louisa's novel "Little Women" (1868). But he also retells less admiring stories, of their petty vindictiveness and casual callousness. Along the way he adumbrates the ways in which idealism can slide into megalomania.

Mr. Francis reports a conversation that Alcott once had with Henry James Sr., the father of the novelist Henry and the philosopher William. Alcott let it drop that he, like Jesus and Pythagoras before him, had never sinned. James asked whether Alcott had ever said, "I am the Resurrection and the Life." "Yes, often," Alcott replied. Unfortunately, Mr. Francis fails to record James's rejoinder: "And has anyone ever believed you?"

Ms. Mullen writes for the Barnes & Noble Review.

The Dangerous Illusion of 'Nuclear Zero' - Why even speculate about a nuclear posture that would require world peace as a precondition?

The Dangerous Illusion of 'Nuclear Zero'. By DOUGLAS J. FEITH AND ABRAM N. SHULSKY
Why even speculate about a nuclear posture that would require world peace as a precondition?
WSJ, May 21, 2010

Moving toward "nuclear zero" is a signature theme of this administration. President Barack Obama's vision of a world without nuclear weapons is certainly grand. The problem is that our current policies lack coherence and rest on other-worldly assumptions.

Consider the administration's recently released Nuclear Posture Review (NPR). One of the conditions that would permit the United States and others to give up their nuclear weapons "without risking greater international instability and insecurity" is "the resolution of regional disputes that can motivate rival states to acquire and maintain nuclear weapons." Another condition is not only "verification methods and technologies capable of detecting violations of disarmament obligations," but also "enforcement measures strong and credible enough to deter such violations."

The first condition would require ending the Arab-Israeli conflict, settling the Korean War, resolving Kashmir and the other India-Pakistan disputes, and defusing Iran's tensions with its neighbors and with the U.S. It also means solving any other significant conflicts that might arise.

Verification would be tough, but even if technology could solve the problem, the question remains: What kind of "enforcement measures" do those who drafted the NPR imagine?

As of now, the U.N. Security Council is the only conceivable policing agency and its record is weak. What, for example, did the Security Council do when Iraq violated the Geneva Convention on poison gas in the 1980s, or when North Korea recently violated the Nuclear Non-Proliferation Treaty? There simply are no good grounds for relying on the Security Council's will to enforce treaties.

U.S. efforts to organize sanctions in response to Iran's illegal pursuit of nuclear weapons have been exercises in frustration. The Security Council deal announced on Tuesday falls far short of the "crippling sanctions" the administration had once intended. This experience undermines the credibility of any threat of enforcement measures—even against a state not allied with a veto-wielding Security Council member. And if China, Russia or an ally of either were someday to cheat on the ban, enforcement would be precluded by veto.

Is some kind of "world executive" envisioned to implement, or at least authorize, enforcement measures over objections from major powers? If so, it's hard to see how the U.S. or any other great power would relinquish its sovereign rights to independent action and self-defense.

"Strong enough" enforcement would have to include military measures. Is the idea here a U.N. military force that could fight large wars, as some diplomats proposed when the U.N. Charter was negotiated in the late 1940s? Or would military enforcement be the duty of the strongest state, presumably the U.S.? Only an arrangement verging on world government—an entity that could deploy overwhelming military power against a violator without interference by other powers—could possibly fill the bill.

The administration recognizes that knowledge about physics cannot simply be eradicated. "In a world where nuclear weapons had been eliminated but nuclear knowledge remains, having a strong infrastructure and base of human capital would be essential to deterring cheating or breakout, or, if deterrence failed, responding in a timely fashion," the NPR says. So even in a world of nuclear zero, the U.S. would have to remain able to rebuild its nuclear capability in a "timely" fashion. Presumably other nuclear-capable states would conclude the same for themselves.

In the event of a serious crisis, countries would race to reconstitute their nuclear arsenals. The winner would enjoy a fleeting nuclear monopoly, and then come under severe pressure to use its nuclear weapons decisively. The resulting instability could make the competitive mobilizations of the European armies in 1914 look like a walk in the park.

So what are the benefits of endorsing nuclear zero as America's goal? Proponents argue that embracing nuclear zero will increase cooperation from other countries against proliferators like North Korea and Iran. But what is this hope based on? America's embracing nuclear zero may take away a debating point from countries unwilling to cooperate with us, but it does nothing to change their interests. The deal Brazil and Turkey cut with Iran this week shows that Mr. Obama's embrace of nuclear zero does not translate into international cooperation where it really matters.

Endorsing nuclear zero makes it even harder for the U.S. government to maintain the nuclear infrastructure that the president says is essential for our security. Why should a bright young scientist or engineer enter a dying field—especially when innovation is discouraged by support for a permanent ban on weapons testing, and by the renunciation of new weapons development? The NPR states that the administration aims to "enhance recruitment and retention" of technical personnel, but its policies seem sure to drive them away.

The NPR stresses that the world's nonproliferation regime requires a strong U.S. nuclear umbrella. Yet the proposal can hardly increase confidence in America's determination to maintain its longstanding global role. U.S. friends overseas worry about their security in a world where America seems determined to shed its burdens as a nuclear power. This will likely spur nuclear proliferation—not discourage it.

President Obama has constructed U.S. nuclear-weapons policy on the assumption that it is helpful to set our goal as the complete abolition of such weapons. But the NPR makes clear that not even the Obama administration can really imagine a world without nuclear weapons. Meanwhile, the president's visionary notions appear likelier to undermine rather than further his own goals of nuclear nonproliferation and stability.

Mr. Feith, a former under secretary of defense for policy, is a senior fellow at the Hudson Institute and the author of "War and Decision: Inside the Pentagon at the Dawn of the War on Terrorism" (Harper, 2008). Mr. Shulsky is a senior fellow at the Hudson Institute and was director of strategic arms control policy at the Department of Defense from 1982 to 1985.

Iran's Nuclear Coup - Ahmadinejad and Lula expose Obama's hapless diplomacy.

Iran's Nuclear Coup. WSJ Editorial
Ahmadinejad and Lula expose Obama's hapless diplomacy.
WSJ, May 18, 2010

What a fiasco. That's the first word that comes to mind watching Mahmoud Ahmadinejad raise his arms yesterday with the leaders of Turkey and Brazil to celebrate a new atomic pact that instantly made irrelevant 16 months of President Obama's "diplomacy." The deal is a political coup for Tehran and possibly delivers the coup de grace to the West's half-hearted efforts to stop Iran from acquiring a nuclear bomb.

Full credit for this debacle goes to the Obama Administration and its hapless diplomatic strategy. Last October, nine months into its engagement with Tehran, the White House concocted a plan to transfer some of Iran's uranium stock abroad for enrichment. If the West couldn't stop Iran's program, the thinking was that maybe this scheme would delay it. The Iranians played coy, then refused to accept the offer.

But Mr. Obama doesn't take no for an answer from rogue regimes, and so he kept the offer on the table. As the U.S. finally seemed ready to go to the U.N. Security Council for more sanctions, the Iranians chose yesterday to accept the deal on their own limited terms while enlisting the Brazilians and Turks as enablers and political shields. "Diplomacy emerged victorious today," declared Brazil's President Luiz Inácio Lula da Silva, turning Mr. Obama's own most important foreign-policy principle against him.

The double embarrassment is that the U.S. had encouraged Lula's diplomacy as a step toward winning his support for U.N. sanctions. Brazil is currently one of the nonpermanent, rotating members of the Security Council, and the U.S. has wanted a unanimous U.N. vote. Instead, Lula used the opening to triangulate his own diplomatic solution. In her first game of high-stakes diplomatic poker, Secretary of State Hillary Clinton is leaving the table dressed only in a barrel.

So instead of the U.S. and Europe backing Iran into a corner this spring, Mr. Ahmadinejad has backed Mr. Obama into one. America's discomfort is obvious. In its statement yesterday, the White House strained to "acknowledge the efforts" by Turkey and Brazil while noting "Iran's repeated failure to live up to its own commitments." The White House also sought to point out differences between yesterday's pact and the original October agreements on uranium transfers.

Good luck drawing those distinctions with the Chinese or Russians, who will now be less likely to agree even to weak sanctions. Having played so prominent a role in last October's talks with Iran, the U.S. can't easily disassociate itself from something broadly in line with that framework.

Under the terms unveiled yesterday, Iran said it would send 1,200 kilograms (2,646 lbs.) of low-enriched uranium to Turkey within a month, and no more than a year later get back 120 kilograms enriched from somewhere else abroad. This makes even less sense than the flawed October deal. In the intervening seven months, Iran has kicked its enrichment activities into higher gear. Its estimated total stock has gone to 2,300 kilograms from 1,500 kilograms last autumn, and its stated enrichment goal has gone to 20% from 3.5%.

If the West accepts this deal, Iran would be allowed to keep enriching uranium in contravention of previous U.N. resolutions. Removing 1,200 kilograms will leave Iran with still enough low-enriched stock to make a bomb, and once uranium is enriched up to 20% it is technically easier to get to bomb-capable enrichment levels.

Only last week, diplomats at the U.N.'s International Atomic Energy Agency reported that Iran has increased the number of centrifuges it is using to enrich uranium. According to Western intelligence estimates, Iran continues to acquire key nuclear components, such as trigger mechanisms for bombs. Tehran says it wants to build additional uranium enrichment plants. The CIA recently reported that Iran tripled its stockpile of uranium last year and moved "toward self-sufficiency in the production of nuclear missiles." Yesterday's deal will have no impact on these illicit activities.

The deal will, however, make it nearly impossible to disrupt Iran's nuclear program short of military action. The U.N. is certainly a dead end. After 16 months of his extended hand and after downplaying support for Iran's democratic opposition, Mr. Obama now faces an Iran much closer to a bomb and less diplomatically isolated than when President Bush left office.

Israel will have to seriously consider its military options. Such a confrontation is far more likely thanks to the diplomatic double-cross of Turkey's Recep Tayyip Erdogan and Brazil's Lula, and especially to a U.S. President whose diplomacy has succeeded mainly in persuading the world's rogues that he lacks the determination to stop their destructive ambitions.

The State Department is sitting on funds to free the flow of information in closed societies

Mrs. Clinton, Tear Down this Cyberwall. By L. GORDON CROVITZ
The State Department is sitting on funds to free the flow of information in closed societies.WSJ, May 03, 2010

When a government department refuses to spend money that Congress has allocated, there's usually a telling backstory. This is doubly so when the funds are for a purpose as uncontroversial as making the Internet freer.

So why has the State Department refused to spend $45 million in appropriations since 2008 to "expand access and information in closed societies"? The technology to circumvent national restrictions is being provided by volunteers who believe that with funding they can bring Web access to many more people, from Iran to China.

A bipartisan group in Congress intended to pay for tests aimed at expanding the use of software that brings Internet access to "large numbers of users living in closed societies that have acutely hostile Internet environments." The most successful of these services is provided by a group called the Global Internet Freedom Consortium, whose programs include Freegate and Ultrasurf.

When Iranian demonstrators last year organized themselves through Twitter posts and brought news of the crackdown to the outside world, they got past the censors chiefly by using Freegate to get access to outside sites.

The team behind these circumvention programs understands how subversive their efforts can be. As Shiyu Zhou, deputy director of the Global Internet Freedom Consortium, told Congress last year, "The Internet censorship firewalls have become 21st-century versions of Berlin Walls that isolate and dispirit the citizens of closed-society dictatorships."

Repressive governments rightly regard the Internet as an existential threat, giving people powerful ways to communicate and organize. These governments also use the Web as a tool of repression, monitoring emails and other traffic. Recall that Google left China in part because of hacking of human-rights activists' Gmail accounts.

To counter government monitors and censors, these programs give online users encrypted connections to secure proxy servers around the world. A group of volunteers constantly switches the Internet Protocol addresses of the servers—up to 10,000 times an hour. The group has been active since 2000, and repressive governments haven't figured out how to catch up. More than one million Iranians used the system last June to post videos and photos showing the government crackdown.

Mr. Zhou tells me his group would use any additional money to add equipment and to hire full-time technical staff to support the volunteers. For $50 million, he estimates the service could accommodate 5% of Chinese Internet users and 10% in other closed societies—triple the current capacity.

So why won't the State Department fund this group to expand its reach, or at least test how scalable the solution could be? There are a couple of explanations.

The first is that the Global Internet Freedom Consortium was founded by Chinese-American engineers who practice Falun Gong, the spiritual movement suppressed by Beijing. Perhaps not the favorites of U.S. diplomats, but what other group has volunteers engaged enough to keep such a service going? As with the Jewish refuseniks who battled the Soviet Union, sometimes it takes a persecuted minority to stand up to a totalitarian regime.

The second explanation is a split among technologists—between those who support circumvention programs built on proprietary systems and others whose faith is on more open sources of code. A study last year by the Berkman Center at Harvard gave more points to open-source efforts, citing "a well-established contentious debate among software developers about whether secrecy about implementation details is a robust strategy for security." But whatever the theoretical objections, the proprietary systems work.

Another likely factor is realpolitik. Despite the tough speech Hillary Clinton gave in January supporting Internet freedom, it's easy to imagine bureaucrats arguing that the U.S. shouldn't undermine the censorship efforts of Tehran and Beijing. An earlier generation of bureaucrats tried to edit, as overly aggressive, Ronald Reagan's 1987 speech in Berlin urging Mikhail Gorbachev: "Tear down this wall."

It's true that circumvention doesn't solve every problem. Internet freedom researcher and advocate Rebecca MacKinnon has made the point that "circumvention is never going to be the silver bullet" in the sense that it can only give people access to the open Web. It can't help with domestic censorship.

During the Cold War, the West expended huge effort to get books, tapes, fax machines, radio reports and other information, as well as the means to convey it, into closed societies. Circumvention is the digital-age equivalent.

If the State Department refuses to support a free Web, perhaps there's a private solution. An anonymous poster, "chinese.zhang," suggested on a Google message board earlier this year that the company should fund the Global Internet Freedom Consortium as part of its defense against Chinese censorship. "I think Google can easily offer more servers to help to break down the Great Firewall," he wrote.

More Mr. Nice Guy - While nukes proliferate, the Federal President fiddles

More Mr. Nice Guy. By John Bolton

While nukes proliferate, Obama fiddles.

The Weekly Standard, February 8, 2010, Vol. 15, No. 20

In his lengthy State of the Union address, President Obama was brief on national security issues, which he squeezed in toward the end. International terrorism, wars in Iraq and Afghanistan, and even America’s relief efforts in Haiti all flashed past in bullet-point mentions. On Iraq and Afghanistan, Obama emphasized neither victory nor determination, but merely the early withdrawal of U.S. forces from both. His once vaunted Middle East peace process didn’t make the cut.

Nonetheless, during this windshield tour of the world, the president found time to opine more explicitly than ever before that reducing America’s nuclear weapons and delivery systems will temper the global threat of proliferation. Obama boasted that “the United States and Russia are completing negotiations on the farthest-reaching arms control treaty in nearly two decades” and that he is trying to secure “all vulnerable nuclear materials around the world in four years, so that they never fall into the hands of terrorists.”

Then came Obama’s critical linkage: “These diplomatic efforts have also strengthened our hand in dealing with those nations that insist on violating international agreements in pursuit of nuclear weapons.” Obama described the increasing “isolation” of both North Korea and Iran, the two most conspicuous—but far from the only—nuclear proliferators. He also mentioned the increased sanctions imposed on Pyongyang after its second nuclear test in 2009 and the “growing consequences” he says Iran will face because of his policies.

In fact, reducing our nuclear -arsenal will not somehow persuade Iran and North Korea to alter their behavior or encourage others to apply more pressure on them to do so. Obama’s remarks reflect a complete misreading of strategic realities.

We have no need for further arms control treaties with Russia, especially ones that reduce our nuclear and delivery capabilities to Moscow’s economically forced low levels. We have international obligations, moreover, that Russia does not, requiring our nuclear umbrella to afford protection to friends and allies worldwide. Obama’s policy artificially inflates Russian influence and, depending on the final agreement, will likely reduce our nuclear and strategic delivery capabilities dangerously and unnecessarily. (Securing “loose” nuclear materials internationally has long been a bipartisan goal, properly so. Obama said nothing new on that score.) Meanwhile, Obama is considering treaty restrictions on our missile defense capabilities more damaging than his own previous unilateral reductions.

What warrants close attention is the jarring naïveté of arguing that reducing our capabilities will inhibit nuclear proliferators. That would certainly surprise Tehran and Pyongyang. Obama’s insistence that the evil-doers are “violating international agreements” is also startling, as if this were of equal importance with the proliferation itself.

The premise underlying these assertions may well be found in Obama’s smug earlier comment that we should “put aside the schoolyard taunts about who is tough.  .  .  .  Let’s leave behind the fear and division.” By reducing to the level of wayward boys the debates over whether his policies are making us more or less secure, Obama reveals a deep disdain for the decades of strategic thinking that kept America safe during the Cold War and afterwards. Even more pertinent, Obama’s indifference and scorn for real threats are chilling auguries of what the next three years may hold.

Obama has now explicitly rejected the idea that U.S. weakness is provocative, arguing instead that weakness will convince Tehran and Pyongyang to do the opposite of what they have been resolutely doing for decades—vigorously pursuing their nuclear and missile programs. Obama’s first year amply demonstrates that his approach will do nothing even to retard, let alone stop, Iran and North Korea.

Neither Bush nor Obama administration efforts toward international sanctions have had any measurable impact. The first Security Council sanctions on North Korea after its ballistic missile and nuclear weapons tests in 2006 did not stop Pyongyang from conducting further missile launches and a second nuclear detonation in 2009. Nor have the measures imposed after that second test, about which Obama boasted, impaired the North’s nuclear program or even brought Pyongyang back to the risible Six-Party Talks. Three sets of Security Council restrictions against Iran have only glancingly affected Tehran’s nuclear program, and the Obama administration’s threats of “crippling sanctions” have disappeared along with last year’s series of “deadlines” that Iran purportedly faced. In response, Tehran’s authoritarianism and belligerence have only increased.

With his counterproliferation strategies, such as they were, in disarray, Obama now pins his hopes on moral suasion, which has never influenced Iran, North Korea, or any other determined proliferator. Perhaps it would have been better had the president’s speech not mentioned national security at all.

John Bolton, former U.S. ambassador to the United Nations, is the author of Surrender Is Not an Option.

Defining Deficits Down

Defining Deficits Down. By Isabel V. Sawhill
Brookings, January 29, 2010

January 29, 2010 — When the president submits his budget on February 1, there will be a lot of hand-wringing about the possible economic fallout from a virtually unprecedented accumulation of debt. A long string of deficits out into the future will increase our dependence on foreign lenders, threaten the recovery if borrowers begin to demand higher interest rates, burden taxpayers with the costs of servicing the debt, and leave our children with a less prosperous future. Although these economic consequences are bad enough, the effects on public confidence in their government are even worse. Paralysis in the face of such dire warnings tells the public that their government is not working, undermines trust in our political institutions, and leads to more cynicism about the entire process, with ramifications that go far beyond the fiscal problem itself. Moreover the problem is so dire now that instead of doubling down on our efforts to do something we have moved the goal posts and redefined our deficit reduction goals. Although this may simply reflect the depth of the hole we are in and the difficulty of digging our way out, it may also shift public perceptions toward too ready acceptance of current reality and its associated dangers.

In the past there were bipartisan efforts to deal with deficits that were far smaller than those currently projected. Such efforts were grounded in a common belief that spending beyond one’s means was imprudent, even morally wrong. The goal for most of the pre World War II years was simple: an annually balanced budget. This meant that spending was cut and taxes raised even when the economy was depressed as in the 1930s. Following World War II, economists began to argue that the goal should be amended to allow deficit spending during recessions as long as that was offset by surpluses during periods of full employment. By the 1980s, this slightly amended goal was still extant and enshrined, for example, in the Gramm-Rudman-Hollings bill that called for a balanced budget by 1991. And when Ross Perot campaigned in 1992 on the need for a balanced budget, and won 19 percent of the vote, Clinton responded by working hard throughout his two terms to get to balance. The decade ended with a surplus of $236 billion in the federal budget. Fast forward to this year, and the goal has shifted from balancing the budget to keeping deficits below 3 percent of GDP in the president’s budget. That would mean accepting a deficit of over $400 billion (in today’s dollars) as a goal. However, even this much more modest goal now appears impossible to reach.

The current administration will be criticized for moving the goal posts on deficit reduction and for doing far too little to restore fiscal balance. This year’s budget includes a freeze on non-security discretionary spending, support for pay-go rules, and a presidentially appointed deficit-reduction commission. These are good but totally insufficient steps. The spending freeze will affect only a tiny slice of the budget; the pay-go rules will make it more difficult for Congress to dig the hole deeper but won’t affect currently projected red ink; and the commission will likely be a paper tiger. In short, these proposals will still leave us with unsustainable deficits as far as the eye can see. Granted current deficits were largely inherited and have been further ballooned by the need to fight the current downturn, leaving the current administration with a herculean task. But it is depressing to discover that we can no long even aspire to balance the budget once the recession is over.

The late Senator Moynihan used to talk about defining deviancy down by which he meant that new norms get established in response to bad behavior. The nation’s fiscal behavior is now so bad that I fear we will soon accept a degree of fiscal profligacy that would have been unthinkable in earlier times. Shame on all of our elected officials, past and present, who have allowed this to happen.

Study finds focus on abstinence in sex-ed classes can delay sexual activity

Study finds focus on abstinence in sex-ed classes can delay sexual activity

By Rob Stein
Washington Post Staff Writer
Monday, February 1, 2010; 4:35 PM

Sex education classes that focus on encouraging children to remain abstinent can convince a significant proportion to delay sexual activity, researchers reported Monday in a landmark study that could have major implications for the nation's embattled efforts to protect young people against unwanted pregnancies and sexually transmitted diseases.

In the first carefully designed study to evaluate the controversial approach to sex ed, researchers found that only about a third of 6th and 7th graders who went through sessions focused on abstinence started having sex in the next two years. In contrast, nearly half of students who got other classes, including those that included information about contraception, became sexually active.

"I think we've written off abstinence-only education without looking closely at the nature of the evidence," said John B. Jemmott III, a professor at the University of Pennsylvania, who led the federally funded study. "Our study shows this could be one approach that could be used."

The research, published in the Archives of Pediatric & Adolescent Medicine, comes amid intense debate over how to reduce sexual activity, pregnancies, births and sexually transmitted diseases among children and teenagers. After declining for more than a decade, births, pregnancies and STDs among U.S. teens have begun increasing again.

The Obama administration eliminated more than $150 million in federal funding targeted at abstinence programs, which are relatively new and have little rigorous evidence supporting their effectiveness. Instead it is launching a new $114 million pregnancy prevention initiative that will fund only programs that have been shown scientifically to work. The administration Monday proposed expanding that program to $183 million next year. The move came after intensifying questions about the effectiveness of abstinence programs.

"This new study is game-changing," said Sarah Brown, who leads the National Campaign to Prevent Teen and Unplanned Pregnancy. "For the first time, there is strong evidence that an abstinence-only intervention can help very young teens delay sex and reduce their recent sexual activity as well."

The new study is the first to evaluate an abstinence program using a carefully "controlled" design that compared it directly to alternative strategies -- considered the highest level of scientific evidence.

"This takes away the main pillar of opposition to abstinence education," said Robert Rector, a senior research fellow at the Heritage Foundation who wrote the criteria for federal funding of abstinence programs. "I've always known that abstinence programs have gotten a bad rap."

Even long-time critics of the approach praised the new study, saying it provided strong evidence that such programs can work and may deserve taxpayer support.

"One of the things that's exciting about this study is that it says we have a new tool to add to our repertoire," said Monica Rodriguez, vice president for education and training at the Sexuality Information and Education Council of the United States.

Based on the findings, Obama administration officials said programs like the one evaluated in the study could be eligible for federal funding.

"No one study determines funding decisions, but the findings from the research paper suggest that this kind of project could be competitive for grants if there's promise that it achieves the goal of teen pregnancy prevention," said Health and Human Services Department spokesman Nicholas Pappas.

Several critics of abstinence-only approach argued that the curriculum tested was not representative of most abstinence programs. It did not take on a moralistic tone as many abstinence programs do. Most notably, the sessions encouraged children to delay sex until they are ready, not necessarily until they were married, did not portray sex outside of marriage as never appropriate or disparage condoms.

"There is no data in this study to support the 'abstain-until marriage' programs, which research proved ineffective during the Bush administration," said James Wagoner, president of Advocates for Youth.

But abstinence supporters disputed that, saying that the new program was essentially the same as other good abstinence programs.

"For our critics to use 'marriage' as the thing that sets the program in this study apart from federally funded programs is an exaggeration and smacks of an effort to dismiss abstinence education rather than understanding what it is," Valerie Huber of the National Abstinence Education Association.

The new study involved 662 African-American students who were randomly assigned to go through one of five programs: An eight-hour curriculum that encouraged them to delay having sex; an eight-hour program focused on teaching safe sex; an eight- or 12-hour program that did both; or an eight-hour program focused on teaching the youngsters other ways to be healthy, such as eating well and exercising.

Over the next two years, about 33 percent of the students who went through the abstinence program started having sex, compared to about 52 percent who were just taught safe sex. About 42 percent of the students who went through the comprehensive program started having sex, and about 47 percent of those who just learned about other ways to be healthy. The abstinence program had no negative effects on condom use, which has been a major criticism of the abstinence approach.

"The take-home message is that we need a variety of interventions to address an epidemic like HIV, sexually transmitted diseases and pregnancy," Jemmott said. "There are populations that really want an abstinence intervention. They are against telling children about condoms. This study suggests abstinence programs can be part of the mix of programs that we offer."

Haitian Amnesty - A humane decision for temporary refuge in America

Haitian Amnesty. WSJ Editorial
A humane decision for temporary refuge in America.
WSJ, Jan 16, 2010

The Obama Administration acted properly, and humanely, late yesterday in extending temporary amnesty to Haitians who were illegally inside the U.S. before this week's catastrophic earthquake. Some 30,000 Haitians had been awaiting deportation but will now be allowed to stay in the U.S. and work for another 18 months.

You might even call this amnesty of a sort, if we can use that politically taboo word. But we hope even the most restrictionist voices on the right and in the labor movement will understand the humanitarian imperative. The suffering and chaos since the earthquake should make it obvious that Haiti is no place to return people whose only crime was coming to America to escape the island's poverty and ill-governance.

For that matter, we don't mind if they stay here permanently. Haitian immigrants as a group are among America's most successful, which demonstrates that Haiti's woes owe more to corruption, disdain for property rights and lack of public safety than to any flaw in its people. Their remittances to Haiti also help to sustain the impoverished population. Haitians received some $1.65 billion from overseas in 2006, according to the Inter-American Development Bank.

We can argue later about whether to make this temporary amnesty permanent, but for now the U.S. decision to let the Haitians stay is evidence of the generosity that Americans typically show in a crisis.

Don't Like the Numbers? Change 'Em

Don't Like the Numbers? Change 'Em. By MICHAEL J. BOSKIN
If a CEO issued the kind of distorted figures put out by politicians and scientists, he'd wind up in prison.
WSJ, Jan 14, 2010

Politicians and scientists who don't like what their data show lately have simply taken to changing the numbers. They believe that their end—socialism, global climate regulation, health-care legislation, repudiating debt commitments, la gloire française—justifies throwing out even minimum standards of accuracy. It appears that no numbers are immune: not GDP, not inflation, not budget, not job or cost estimates, and certainly not temperature. A CEO or CFO issuing such massaged numbers would land in jail.

The late economist Paul Samuelson called the national income accounts that measure real GDP and inflation "one of the greatest achievements of the twentieth century." Yet politicians from Europe to South America are now clamoring for alternatives that make them look better.

A commission appointed by French President Nicolas Sarkozy suggests heavily weighting "stability" indicators such as "security" and "equality" when calculating GDP. And voilà!—France outperforms the U.S., despite the fact that its per capita income is 30% lower. Nobel laureate Ed Prescott called this disparity the difference between "prosperity and depression" in a 2002 paper—and attributed it entirely to France's higher taxes.

With Venezuela in recession by conventional GDP measures, President Hugo Chávez declared the GDP to be a capitalist plot. He wants a new, socialist-friendly way to measure the economy. Maybe East Germans were better off than their cousins in the West when the Berlin Wall fell; starving North Koreans are really better off than their relatives in South Korea; the 300 million Chinese lifted out of abject poverty in the last three decades were better off under Mao; and all those Cubans risking their lives fleeing to Florida on dinky boats are loco.

There is historical precedent for a "socialist GDP." When President George H.W. Bush sent me to help Mikhail Gorbachev with economic reform, I found out that the Soviet statistics office kept two sets of books: those they published, and those they actually believed (plus another for Stalin when he was alive).

In Argentina, President Néstor Kirchner didn't like the political and budget hits from high inflation. After a politicized personnel purge in 2002, he changed the inflation measures. Conveniently, the new numbers showed lower inflation and therefore lower interest payments on the government's inflation-linked bonds. Investor and public confidence in the objectivity of the inflation statistics evaporated. His wife and successor Cristina Kirchner is now trying to grab the central bank's reserves to pay for the country's debt.

America has not been immune from this dangerous numbers game. Every president is guilty of spinning unpleasant statistics. President Richard Nixon even thought there was a conspiracy against him at the Bureau of Labor Statistics. But President Barack Obama has taken it to a new level. His laudable attempt at transparency in counting the number of jobs "created or saved" by the stimulus bill has degenerated into farce and was just junked this week.

The administration has introduced the new notion of "jobs saved" to take credit where none was ever taken before. It seems continually to confuse gross and net numbers. For example, it misses the jobs lost or diverted by the fiscal stimulus. And along with the congressional leadership it hypes the number of "green jobs" likely to be created from the explosion of spending, subsidies, loans and mandates, while ignoring the job losses caused by its taxes, debt, regulations and diktats.

The president and his advisers—their credibility already reeling from exaggeration (the stimulus bill will limit unemployment to 8%) and reneged campaign promises (we'll go through the budget "line-by-line")—consistently imply that their new proposed regulation is a free lunch. When the radical attempt to regulate energy and the environment with the deeply flawed cap-and-trade bill is confronted with economic reality, instead of honestly debating the trade-offs they confidently pronounce that it boosts the economy. They refuse to admit that it simply boosts favored sectors and firms at the expense of everyone else.

Rabid environmentalists have descended into a separate reality where only green counts. It's gotten so bad that the head of the California Air Resources Board, Mary Nichols, announced this past fall that costly new carbon regulations would boost the economy shortly after she was told by eight of the state's most respected economists that they were certain these new rules would damage the economy. The next day, her own economic consultant, Harvard's Robert Stavis, denounced her statement as a blatant distortion.

Scientists are expected to make sure their findings are replicable, to make the data available, and to encourage the search for new theories and data that may overturn the current consensus. This is what Galileo, Darwin and Einstein—among the most celebrated scientists of all time—did. But some climate researchers, most notably at the University of East Anglia, attempted to hide or delete temperature data when that data didn't show recent rapid warming. They quietly suppressed and replaced the numbers, and then attempted to squelch publication of studies coming to different conclusions.

The Obama administration claims a dubious "Keynesian" multiplier of 1.5 to feed the Democrats' thirst for big spending. The administration's idea is that virtually all their spending creates jobs for unemployed people and that additional rounds of spending create still more—raising income by $1.50 for each dollar of government spending. Economists differ on such multipliers, with many leading figures pegging them at well under 1.0 as the government spending in part replaces private spending and jobs. But all agree that every dollar of spending requires a present value of a dollar of future taxes, which distorts decisions to work, save, and invest and raises the cost of the dollar of spending to well over a dollar. Thus, only spending with large societal benefits is justified, a criterion unlikely to be met by much current spending (perusing the projects on recovery.gov doesn't inspire confidence).

Even more blatant is the numbers game being used to justify health-insurance reform legislation, which claims to greatly expand coverage, decrease health-insurance costs, and reduce the deficit. That magic flows easily from counting 10 years of dubious Medicare "savings" and tax hikes, but only six years of spending; assuming large cuts in doctor reimbursements that later will be cancelled; and making the states (other than Sen. Ben Nelson's Nebraska) pay a big share of the cost by expanding Medicaid eligibility. The Medicare "savings" and payroll tax hikes are counted twice—first to help pay for expanded coverage, and then to claim to extend the life of Medicare.

One piece of good news: The public isn't believing much of this out-of-control spin. Large majorities believe the health-care legislation will raise their insurance costs and increase the budget deficit. Most Americans are highly skeptical of the claims of climate extremists. And they have a more realistic reaction to the extraordinary deterioration in our public finances than do the president and Congress.

As a society and as individuals, we need to make difficult, even wrenching choices, often with grave consequences. To base those decisions on highly misleading, biased, and even manufactured numbers is not just wrong, but dangerous.

Squandering their credibility with these numbers games will only make it more difficult for our elected leaders to enlist support for difficult decisions from a public increasingly inclined to disbelieve them.

Mr. Boskin is a professor of economics at Stanford University and a senior fellow at the Hoover Institution. He chaired the Council of Economic Advisers under President George H.W. Bush.

Comentarios al post "California: Caos democrático" en Abilene blog

Comentarios al post "California: Caos democrático" en Abilene blog
Dec 28, 2009

hola, creo que hay varias cosas que no acaban de capturar realmente la esencia de las diferencias del sistema federal y el europeo continental:

“Con este hecho se demuestran las dificultades de articular estados en los que gobiernan políticos cuyas ideologías y planes de acciones han resultado fracasadas.”

A qué ideologías se refieren? Porque las dos cámaras son, sorpresa, de mayoría demócrata, cosa que no sé si se puede deducir del artículo (aunque sí del artículo de P Krugman). Parece, de otros trozos del mismo, que se refiere a que los fracasados son los republicanos.

Me parece ver aquí una habitual confusión: en política europea el primer ministro es elegido en la cámara popular, vamos a decir, por lo que muy difícilmente piensan distinto la mayoría de la cámara y el Ejecutivo (salvo el caso italiano), mientras que en los EE UU lo normal es que haya dos cámaras iguales (puede haber una) y el Ejecutivo sea elegido al margen de las mismas. Gobiernan todos, el Legislativo y el Ejecutivo. No hay que confundir gobernador o presidente federal con mayoría en la cámara baja, que es el caso de aquí.

Acerca de esto otro:

“Los ciclos legislativos desfasados del ciclo del país provocan que mientras hay una renovación política en EEUU, aun siguen gobernando en algunos estados las anteriores corrientes de poder (recordemos que en las elecciones generales B. Obama se proclamó vencedor en California, A. Schwarzenegger es republicano).”

un par de cosas:

- Lo de “siguen gobernando en algunos estados las anteriores corrientes de poder” da la impresión de que el autor cree que, ya que en las elecciones federales ha habido mayorías demócratas en las cámaras federales y el Ejecutivo federal, por ello debería haber casi 50 de los 50 estados con mayorías demócratas en Legislativo y Ejecutivo. Esto es totalmente ajeno a cómo funciona el sistema. De hecho, más o menos la mitad de los estados son republicanos y más o menos la mitad son demócratas, simplificando. Eso es al margen de quién consiga la presidencia federal.

- Como dije antes, las dos cámaras son demócratas (lo que hace que se vea especialmente flojo el análisis sociológico de “Sólo una minoría de los californianos se molesta en votar habitualmente, los votantes tienden a ser mayores, más blancos y más ricos que la mayoría predominante de la población”, según eso y las creencias del autor debería haber mayoría republicana en ambas cámaras). Que el gobernador sea republicano (y muchos republicanos dirían que es un RINO, Republican In Name Only) es irrelevante para esta discusión. Lo que falta es una mayoría suficiente de demócratas en las cámaras, pero si la gente prefiere la parálisis (y es bastante común tener el Ejecutivo de un partido y las cámaras o al menos una de ellas con mayoría de otro partido opuesto, ejemplo parálisis en la época Clinton), es lo que se necesita en ese momento, aunque visto desde Europa parezca incomprensible.

Por último, cree de verdad el autor que P Krugman es parte desinteresada en los análisis? Cree que se le puede recomendar como lectura única, sin equilibrar con otra visión después de frases como éstas?:

. “los miembros restantes del partido [republicano] se han vuelto cada vez más radicales, cada vez menos interesados en la labor de gobernar.”

. “el creciente extremismo del partido [republicano]”

. “Dicho sin rodeos: los últimos acontecimientos indican que el Partido Republicano se ha vuelto loco al perder el poder”

. “Los pocos moderados que quedaban [entre otras cosas] han huido”

Los que votan republicano son, como los que votan demócrata, cerca de la mitad del electorado y más o menos del país. Acusar a cualquiera de las mitades de creciente extremismo, haberse vuelto locos, haber hecho huir a los moderados, o estar boicoteando la labor de gobierno revela los odios y amores del profesor, que no parece una fuente que los historiadores puedan citar en el futuro sin añadir inputs de otras fuentes.

Jackson Toby's "The Lowering of Higher Education in America"

On Campus, Unprepared. By BEN WILDAVSKY
Colleges are filled with unserious students learning too little. What should be done?
WSJ, Dec 23, 2009

When President Barack Obama announced earlier this year that the U.S. should aim to have the world's highest proportion of college graduates by 2020, he was staking out an ambitious but hardly a maverick goal. It is widely recognized, by Republicans and Democrats alike, that the gap between the earnings of high-school graduates and college graduates has become a chasm in recent decades. More college graduates would mean more prosperity for individuals—and for the nation, too. Bowing to this logic, governments around the world—from China and India to the Middle East—are trying to boost college attendance for their knowledge-hungry populations.

As Mr. Obama's goal suggests, there is plenty of room for improvement in the U.S. While nearly seven in 10 high-school graduates go on directly to two- or four-year colleges (up from 49% in 1972), many students are poorly prepared for college and end up taking remedial courses. And huge numbers fail to graduate. Reformers believe, not without reason, that such problems can be solved in part by improved high-school preparation and better college instruction. But is it possible that aiming to increase the number of American college graduates is actually a fool's errand?

A few skeptics think so. Most prominent among them is Charles Murray, who in "Real Education" (2008) argued that most young people are just not smart enough to go to college and should be encouraged to take other paths instead, especially vocational training. Now comes Jackson Toby with "The Lowering of Higher Education in America," a provocative variation on Mr. Murray's theme.

Mr. Toby draws on social-science data as well as personal experience—he taught sociology at Rutgers University for 50 years before retiring a few years ago—to decry the intellectual conditions that prevail on the American campus. Sidestepping the matter of students' innate abilities, he blames low academic standards mostly on the easy availability of financial aid to undergraduates who are unqualified for college-level coursework.

Early on, Mr. Toby concedes that education has become the country's "main economic escalator." But he is alarmed at how few students are prepared to meet even the minimal demands of a real college education. He faults lax college-admission standards that give high schools little incentive to push their students harder. Too many undergrads can't write with minimal competence or understand basic cultural references. Students often take silly, politicized courses. And they feel entitled to inflated grades: Mr. Toby reports that one of his students spewed obscenities at him for ending the young man's straight-A record.

Perhaps this kind of experience accounts for Mr. Toby's seeming bitterness toward unserious students, whom he calls "unprepared, half-asleep catatonics who drift in late and leave early." Most undergrads, Mr. Toby suggests, enjoy a steady diet of extracurricular hedonism while skating through their coursework (though it's unclear how this claim jibes with his complaints about low graduation rates).

Worst of all, he says, students have been misled about the value of their degrees. Yes, a bachelor of arts degree commands a wage premium, but less because of a graduate's acquired knowledge than because of the signal that his degree sends to employers about the abilities that got him into college and about a variety of soft skills, such as reliability and problem-solving capacity. Graduates in undemanding majors—in the humanities, for example, or most of the social sciences—are unlikely to earn what their more studious counterparts in, say, engineering can. They are thus disproportionately likely to be saddled with debt and prone to default, Mr. Toby argues. He claims that this pattern amounts to the kind of unsound lending that led to our recent credit crisis—one that he darkly suggests may soon be repeated in higher education. He believes that today's "promiscuous" system of college grants and loans—which, at the federal level, is based largely on financial need—ought to be retooled to focus on academic merit.

But his platform is less radical than his book's subtitle promises ("Why Financial Aid Should Be Based on Student Performance"). He acknowledges that quite a few states already have merit-based aid. And in a concession to political reality he would continue the federal Pell Grant program, which focuses on need alone. Mr. Toby's main proposal, then, is to require good grades and test scores from those seeking federal student loans. This requirement, he believes, would improve incentives for academic performance and mitigate the inevitable trade-off between widening access to college and maintaining educational standards.

Strangely, Mr. Toby does not address the biggest objection to merit aid, which is that it usually subsidizes middle- and upper-income students who would go to college anyway. By contrast, need-based aid often provides make-or-break help to low-income applicants: Without grants and student loans, they would probably not go to college at all.

Mr. Toby sees reduced college opportunities as the price of keeping under-prepared students off campus. But that is one trade-off we should not make, especially when a college degree carries so much value in the marketplace. Our vast and varied college system, to its credit, enrolls all sorts of students. Mr. Toby delineates the system's manifold shortcomings, which badly need to be remedied. And to be sure, academic merit deserves a place in our financial aid system. But the indisputable benefits of college ought to be spread more widely, not less.

Mr. Wildavsky, a senior fellow at the Kauffman Foundation and a guest scholar at the Brookings Institution, is the author of "The Great Brain Race: How Global Universities Are Reshaping the World," to be published next spring.

Sometimes the good guys do commit 'war crimes'

The Real Rules of War. By WARREN KOZAK
Sometimes the good guys do commit 'war crimes.'
WSJ, Dec 23, 2009

Five years ago, a particularly gruesome image made its way to our television screens from the war in Iraq. Four U.S. civilian contractors working in Fallujah were ambushed and killed by al Qaeda. Their bodies were burned, then dragged through the streets. Two of the charred bodies were hung from the Euphrates Bridge and left dangling.

This barbaric act left an impression that our military did not forget: In a special operation earlier this year, Navy SEALs captured the mastermind of that attack, Ahmed Hashim Abed. But after he was taken into custody in September, Abed claimed he was punched by his captors. He showed a fat lip to prove it. Three of the SEALS are now awaiting a courts-martial on charges ranging from assault to dereliction of duty and making false statements.

This incident and its twisted irony takes me back to an oddly serene setting many years ago. When I was in college, I joined my parents on a trip to retrace my father's wartime experience in Europe. We drove from France, through Holland and Belgium and on to Germany—the same route he had taken with the U.S. Army in 1944-45. At a field outside the Belgian town of Malmedy, we got out of our rented car where my father described something I had never heard before.

During the Battle of the Bulge, in the bleak December of 1944, the Germans had quickly overrun the American lines. They took thousands of prisoners as they pushed through in a last chance gamble to turn the war around. One unit, part of the First SS Panzer Division, had captured over a hundred GIs. They were moving fast, and they didn't care to be burdened by prisoners. So the SS troops put the American soldiers in that field and mowed them down with machine guns.

Around 90 Americans were killed in that barrage. The Germans then walked through the tangle of bodies, shooting those who were still alive in the back of the head. The few that survived were brought to where my father was located in the nearby town of Liege where word of the massacre quickly spread.

My father was never a talker. And in spite of the fact that we were on a trip to look at his past, he didn't open up much, or couldn't. When I asked him what the reaction was among the U.S. troops, he answered without emotion: "We didn't take prisoners for two weeks." I immediately understood what he meant, and had the sense not to press the issue any further. I just looked out at the field, now green and peaceful on a beautiful summer day, and realized he was looking at the same field and seeing something quite different.

In the weeks following the Malmedy massacre, U.S. troops clearly broke the rules of the Geneva Conventions. Justified or not, they were technically guilty of war crimes.

My guess is that the American correspondents imbedded with those troops knew all about this and chose not to report it. So did their officers. They understood the gravity of the war, as well as the absolute importance of its outcome. And they understood that disclosing this information might ultimately help the enemy. In other words, they used common sense. Was the U.S. a lesser country because these GIs weren't arrested? Was the Constitution jeopardized? Somehow it survived.

You don't have to dig too deep to understand that war brings out behavior in people that they would never demonstrate in normal life. In Paul Fussell's moving memoir, "The Boys' Crusade," the former infantryman relates a story about the liberation of Dachau. There were about 120 SS guards who had been captured by the Americans. Even though the Germans were being held at gunpoint, they still had the arrogance—or epic stupidity—to continue to heap verbal abuse and threats on the inmates. Their American guards, thoroughly disgusted by what they had already witnessed in the camp, had seen enough and opened fire on the SS. Some of the remaining SS guards were handed over to the inmates who tore them limb from limb. Another war crime? No doubt. Justified? It depends on your point of view. But before you weigh in, realize that you didn't walk through the camp. You didn't smell it. You didn't witness the obscene horror of the Nazis.

Rules of war are important. They are something to strive for as they separate us from our distant ancestors. But when only one side follows these rules, they no longer elevate us. They create a very unlevel field and more than a little frustration. It is equally bizarre for any of us to judge someone's behavior in war by the rules we follow in our very peaceful universe. We sit in homes that are air-conditioned in the summer and warmed in the winter. We have more than enough food in our bellies and we get enough sleep. The stress in our lives won't ever match the stress of battle. Can we honestly begin to decide if a soldier acted in compliance with rules that work perfectly well on Main Street but not, say, in Malmedy or Fallujah?

In his book, Mr. Fussell probably sums up the feelings of many soldiers when he quotes a British captain, John Tonkin, who experienced a great deal of the war. "I have always felt," Capt. Tonkin said, "that the Geneva Convention is a dangerous piece of stupidity, because it leads people to believe that war can be civilized. It can't."

Mr. Kozak is the author of "LeMay: The Life and Wars of General Curtis LeMay" (Regnery, 2009).

Al From: Democrats Don't Need the Public Option - Transformational reforms have always passed with bipartisan majorities

Democrats Don't Need the Public Option. By AL FROM
Transformational reforms have always passed with bipartisan majorities.
WSJ, Oct 16, 2009

Now that the Senate Finance Committee has voted for a health-care bill that does not include a government-run plan, it would be a mistake for Democrats to insist on adding the public option to reform legislation this year.

By insisting on the public option, liberal Democrats will allow the Republicans, who have no ideas of their own, to cloud the prospects for reform. If this happens, Republicans will be able to divert attention away from reforms most Americans want and instead focus on what Americans disagree on—whether we need a new government-run health plan.

As President Barack Obama has made clear, we need to reform. Right now, health insurance is too costly and the health-insurance market is not competitive enough. Too many people lack insurance or the chance to choose a plan that best suits their needs. Too many people are denied coverage because of pre-existing conditions or lose their coverage when they become sick. And our most successful public program—Medicare—is on the road to going broke. Doing nothing is not acceptable.

With control of the White House and Congress, the American people will rightly hold Democrats accountable for the outcome of the health debate. At the same time, the focus on the public option and level of discord it has generated is already taking a toll on the president's approval ratings and hurting the party more generally. In January, Democrats enjoyed a double digit lead on the "generic ballot"—a measure of support for a party. Last week, a Gallup poll showed that Democrats are now essentially in a dead heat with Republicans on the generic ballot. Particularly significant, the poll showed a nearly 20-point drop in Democratic support since the last election among independents, the key to our victories in 2006 and 2008. Insisting on the public option could cost many Blue Dogs in the House and a number of red-state moderates in the Senate their seats.

Now is the time for Mr. Obama to lead the way to historic health-care reform. He's the only one who can. I'd suggest he do so by taking these three steps:

• First, say unequivocally that he wants a plan that jettisons the public option and contains real reforms to cut health-care costs. As the Senate Finance Committee bill shows, a public option is unnecessary to expand coverage. Dropping it should win support of most centrist Democrats.
• Second, make clear that he does not want Congress to use parliamentary maneuvers, like the budget reconciliation process, to ram through a bill that can't command 60 votes in the Senate. Health-care reform needs broad support; it is too important and too controversial for Congress to pass by resorting to legislative chicanery or short-circuiting the legislative process.
• And finally, make one more effort to bring moderate Republicans along. Transformational reforms, such as civil rights legislation and Medicare in the 1960s, have always been passed with bipartisan majorities. Health-care reform should be no exception. The president promised a post-partisan politics. What better place to forge it than on his most important initiative?

If Mr. Obama takes these steps, I'm convinced Congress would pass a bill that requires every American to buy insurance, offers consumers a choice of plans through a new health exchange like the successful Commonwealth Connector in Massachusetts, provides subsidies that assure everyone can afford a basic plan, and prevents insurance companies from denying coverage to people with pre-existing conditions or dropping coverage for people who become sick. All of these are reforms most American can agree on.

I'd personally like to see health-care reform include fees (as the president proposed) on Cadillac health-care plans, incentives to replace fee-for-service payments with more cost-effective models (the best way to bring down health-care costs over the long haul), and measures to limit abuses in malpractice suits (which Republicans have long called for).

Such a plan would meet the objectives the president has already outlined—expanding coverage, lowering costs, and improving quality—without adding to the federal deficit. With centrist Democrats signed on, such a plan should garner the 60 votes necessary to pass the Senate. Even without a public option, it would achieve most of what liberals have long fought for. Open-minded Republicans might even find it hard to resist.

Mr. From, the principal of The From Company LLC, is the founder of the Democratic Leadership Council.

‘Blue Dogs’ or Corporate Shills?

‘Blue Dogs’ or Corporate Shills? By Thomas Frank
WSJ, Aug 05, 2009

Capitalism is said to be in terrible trouble these days, with the profit motive suffering rampant badmouthing. Entrepreneurs are facing criticism, damnable criticism. And this criticism must stop.

If we don’t watch what we say, some warn, the supermen who shoulder the world will soon grow tired of our taunting, will shrug off their burden and walk righteously away, leaving us lesser mortals to stew in our resentment and envy.

So far have things gone that the editors of the Washington Post, ever vigilant against deteriorating public morals, apparently decided last week that Americans required a strong dose of instruction in the basic principles of their old-time economic religion. Stephen L. Carter, the famous law professor from Yale University, took the pulpit. And from the heights of the Post’s op-ed page, he instructed us to cheer whenever we discovered that someone was making money.

“High profits are excellent news,” he intoned. “The only way a firm can make money is to sell people what they want at a price they are willing to pay.”

Since that’s the one and only way a firm can make a profit—fraud isn’t a problem, I guess, nor are subsidies or cherry-picking or price-fixing or conflicts of interest—profit is a foolproof sign of civic uprightness.

Professor Carter’s essay was supposed to be a word of caution in a dark, anticapitalist time. But if you read your newspaper closely, it’s not hard to spot glimmers of profit-taking here and there. For example, while some see the city of Washington as a stage for anticorporate posturing, in fact it is ingeniously entrepreneurial.

Consider the “Blue Dog” Democrats, whose money-making ways were the subject of a page-one story in the Washington Post on the very day after Mr. Carter’s sermon. The Blue Dogs, as the world knows, are the caucus of conservative House Democrats who have been much in the news of late for their role in weakening the Obama administration’s plans for a public health-insurance option.

Much of the writing about the Blue Dogs revolves around the question of why they do what they do. What makes the Dogs run? Where did they get their peculiar name? And why do they chase this car but not that one?

The Blue Dogs’s official caucus Web site answers with rhetorical tail-chasing in which “centrism” is so exalted that it justifies any position the centrist takes by virtue of the label itself. The slightly more sophisticated explanation currently in vogue with the media—the Dogs come from heartland districts where the culture wars are a big deal—helps even less.
As the syndicated columnist David Sirota pointed out last week on the OpenLeft blog, having constituents who care deeply about, say, gun rights doesn’t really have anything to do with the pro-corporate stands on mortgage modification and health insurance that have made the Blue Dogs famous.

Friday’s page-one Post story about the Blue Dogs suggests a far simpler explanation: Entrepreneurship. In addition to everything else, the Dogs are champion fund raisers. Individual Dogs do far better than garden-variety Democrats when it comes to bringing in contributions from folks with business before Congress, like the insurance industry and the medical industry. According to CQ, their political action committee is the only Democratic PAC to rival the big Republican dogs; in 2009 fund raising it has been bested only by Mitt Romney’s gang.

So this is the Blue Dogs’ day, with games of fetch down on K Street that had me reminiscing, as I read the Post’s description, about the times when Tom DeLay and his pack did their own tricks for industry’s table scraps.

My guess is that the Blue Dogs, like Jack Abramoff’s Republicans before them, are more keenly attuned than their colleagues to that force of universal goodness, the profit motive. Theirs is simply a less ferocious version of what we had before, with cuddly bipartisan righteousness replacing the fierce red-state righteousness of DeLay’s dogs. But the master is the same as ever, and surely we can still count on the profit motive to deliver the very best in public policy.

Still, there remains the problem of the senseless moniker, “Blue Dog.” In the interests of improved political nicknames, let me propose an alternative. Back in 1932, the future Illinois Sen. Paul Douglas advised progressives not to expect too much from the Democratic Party. It was, he wrote, “maintained by the business interests” as a kind of “lifeboat.” Whenever the GOP ship sprung a leak—whenever Republicans were no longer willing or able to do business’s bidding—the interests simply piled into the other party and made their escape.

The Democrats have improved considerably since those days, at least from a progressive standpoint. But there are still branches of the party willing to carry out the ancestral mission. Let’s call them what they are: the lifeboat caucus.