The Death Of Abu Bakr Al-Baghdadi And Related Matters

The self-proclaimed "Caliph" of Da'esh/ISIL/ISIS, Ibrahim Ali al-Badri al-Samarri, who took the name Abu Bakr al-Baghdadi, has blown himself up after US special forces successfully attacked his compound in Idlib province of Syria near the Turkish border after a US military dog attacked him. (His nom de guerre was chosen for its links to historical caliphs, the leaders of global Sunni Islam after the death of the Prophet Muhammed supposedly in his place, with Abu Bakr being the first such after the death of his son-in-law the Prophet and al-Baghdadi invoking the capital of the most powerful of all the caliphates, the Abbasid that ruled for 500 years from their capital in Baghdad).  A few observations.

While President Trump Trump bragged about this success of the US military for 46 minutes as a personal success of his own, the event was delayed for nearly a week and almost did not happen as al-Baghdadi was reportedly on the verge of moving again from the compound he was caught in because Trump had allowed Turkey to invade northeastern Syria, disrupting the Syrian Kurds there who had been the main US allies against Da'esh and al-Baghdadi, thus disrupting temporarily the planned attack.

While Trump most prominently thanked Russia and secondarily Turkey for their assistance in his speech while barely mentioning the US Kurdish allies, it was the latter who not only were largely responsible for ending the self-proclaimed caliphate as an entity ruling over people and territory in Syria, but also reportedly according to the Washington Post developed the mole within al-Baghdadi's circle who provided the crucial intelligence on al-Baghdadi's whereabouts and the details of his compound that made it possible to carry out this attack successfully.  The only thing Russia did was allow this attack to go forward as they reportedly control the airspace over Idlib province.  I am unaware of anything Turkey did to help this at all and in fact had in the past allowed goods to flow to Da'esh across the Turkish-Syrian border and most recently has been de facto supporting the al-Qaeda-related groups controlling Idlib province on the ground, with al-Baghdadi's compound near the Turkish border and the remnants of Da'esh apparently forming an alliance with those groups after having split from al-Qaeda in Iraq originally, with al-Qaeda considering them to be too violent.

In his bragging account of the successful operation Trump appears to have made up some details out of whole cloth in order to heighten the drama of it all, including perhaps most importantly a claim that al-Baghdadi was crying and screaming in a cowardly way at the end, something that has not been supported or verified at all by anybody publicly having primary knowledge of the events there.

Obviously Trump's decision to let Turkey invade Syria against the Kurds there and to describe these allies without whom al-Baghdadi would not have been found to be "worse terrorists then ISIS" as well as "no angels" as well as approving the entry of Russian and Syrian national troops into northeastern Syria reflects his admiration for the leaders of Turkey and Russia, where has major hotels in Istanbul and long has had financial relations with Russian oligarchs and desires to have a Trump Tower in Moscow.  His willingness to nearly botch this operation by betraying the Kurds (language used by Putin's press secretary, Peskov, regarding his actions) seems best explained by Trump's ongoing view of himself as "being primarily in the hospitality business" as his Acting Chief of Staff, Mick Mulvaney inadverdently put it in an interview on TV.

We finally have the absurd spectacle of Trump deciding to keep 200 troops in Syria to control a small group of oil wells there that Da'esh had gotten money from selling oil from until the SDF took control of them, but with the largely Syrian Kurdish SDF (which includes Christian Arabs) on the run thanks to the Turkish invasion, control of those wells might fall into the hands of either Da'esh agaiin, who will probably gain from this invasion given the freeing of over 100 fighters, despite the death of its leader, al-Baghdadi, or Syrian national troops backed by the Russians or maybe even the Turks.  Trump is under the fantasy that this oil might be developed and sold by an American company, but none will do so given that they are actually in Syrian national territory and thus this would be illegal internationally, as well as the area being a war zone.  Trump is simply delusional on this matter.

While I do not wish any particular person dead and oppose the death penalty, I do not mourn the horrible al-Baghdadi and am glad to see him no longer around to lead the remnants of Da'esh/ISIL/ISIS (I continue to be appalled by the insistence of western media of calling this renegade murderous outfit "the Islamic State" thus spreading the group's own propaganda).  But rather than deserving praise for this outcome, President Trump deserved the booing and "Lock Him Up" chants he experienced at the fifth game of the World Series given his betrayal of the Kurds that nearly made this operation impossible.

A final note is that in the wake of this, for the first time ever, the US House of Representatives has passed a resolution condemning Turkey for its refusal to recognize and apologized for the genocide carried out by the Turkish-dominated Ottoman Empire in 1915 against the Armenians.  This resolution, likely not to be passed in the Senate, had strong bipartisan support in the House.  It is about time, and the credibility of  Turkey's claims of innocence in the 1915 matter are as good as their  claims that the SDF was carrying out terror attacks against them, which is basically near zero in both cases.

Oh, Happy Halloween everybody.  I figures this makes for an appropriate post on Halloween.

Barkley Rosser

The Famous Baseball-Watching Equality-Equity Graphic, Scrutinized

Here’s the graphic, widely used to explain why equity outcomes require unequal treatment of different people.

Benjamin Studebaker (hat tip Naked Capitalism) doesn’t like it at all: “I hate it so much.”  But his complaints, about the way the graphic elides classic debates in political theory, strike me as being too redolent of grad school obsessions.  The graphic is not trying to advance one academic doctrine over another; it just makes a simple case for compensatory policy.  I agree in a general way with this perspective.

Consider the Americans with Disabilities Act of 1990, which mandates special facilities in public buildings to accommodate people in wheelchairs or facing other mobility challenges.  This is unequal treatment: extra money is spent to install ramps that only a few will use, rather than for amenities for everyone.  But it’s a great idea!  Yes, compensation is concentrated on a minority, but it aims to allow everyone to participate in public activities, and in doing this it embodies a spirit of solidarity that ought to embrace all of us.  By making a simple, intuitive case for focused compensation, the graphic captures the spirit behind the ADA and many other policies that take account of inequalities that would otherwise leave some members of the community excluded and oppressed.

Unfortunately, however, there are serious limitations to the graphic; above all, it embodies assumptions that beg most of the questions people ask about compensatory programs.  Some are challenges from conservatives of a more individualistic bent, others might be asked by friendly critics on the left, but all are worthy of being taken seriously.

1. Watching the game over the fence is binary: either you can see it or you can’t.  In the real world, however, most activites are matters of degree.  You can learn more or less of a particular subject in school, have a better or worse chance of getting the job you want, live in a bigger or smaller house or apartment.  How much compensation is enough?  At what point do we decide that the gains from ex post equity are not large enough to justify the other costs of the program, not only monetary but possible conflicts with other social objectives?  Every teacher who has thought about how much extra attention to give those students who come to the classroom with extra needs has faced this problem.

2. Watching the game is passive, an act of pure consumption.  Things get more complex when inequalities involve activities that produce goods of value to others.  For instance, how would the graphic address compensatory programs for the baseball players?  Yes, a player from an underserved, overlooked community should get an extra chance to show they should be on the team.  But should the criteria for who makes the team be relaxed?  How and how much?  In case you haven’t noticed, this gets to the core of debates over affirmative action.  Again, I am in favor of the principle of taking extra steps to compensate for pre-existing inequalities, but the graphic offers no guidance in figuring out how far to go in that direction.

3. Height is a largely inherited condition, but what about differences in opportunity that are at least partly the result of the choices we make ourselves?  This is red meat to conservatives, who denounce affirmative action and other compensatory policies on the grounds that they undermine the incentive to try hard and do one’s best.  I think this position is too extreme, since inherited and environmental conditions are obviously crucial in many contexts, but it would also be a mistake to say that individual choices play no role at all.  Again we are facing questions of degree, and the graphic, with it’s clear intimation that inequality is inborn and ineluctable, doesn’t help.

4. The inequality depicted in the graphic is height, which is easily and uncontroversially measured.  Most social inequalities are anything but.  Student A went to a high school with a library; student B’s high school didn’t have one.  That’s a meaningful inequality, and if an opportunity can be awarded to only one of them, like entrance into a selective college program, it ought to be considered.  But how big an effect should we attribute to it?  Damned if I know.

5. There is no real scarcity facing the three game-watchers in the graphics.  There are enough boxes to allow everyone to get a good view and enough fence space for everyone to share.  In the real world neither tends to be true.  Resources that can be devoted to compensatory programs are limited, especially on a global scale, which, if you’re really an egalitarian, is how you should think about these things.  Even locally, the money often runs short.  The college I used to teach at could be criticized for not doing enough for students from low income and rural backgrounds with weak K-12 systems (I certainly did), but even with the best of intentions the money was not there.  Of course, where the goods to be distributed are competitive, like slots in a school or job openings at a company, the problem is that there’s not enough fence space to go around.  Yes, we should take action to provide more opportunities and reduce the competitive scarcity.  No, this won’t make the scarcity go away completely.

6. The graphic shows us three individuals and asks us to visually compare their heights.  America has a population of over 320 million, and even “small” communities can have a cast of thousands.  Surely we are not expected to make individual calculations for every person-by-person comparison.  No, those using the graphic usually have in mind group comparisons—differences requiring compensatory interventions according to race, class, gender, ability status, etc.  But while that makes things easier by reducing the number of comparisons, it makes everything else much harder to figure out: How do we measure group advantages and disadvantages?  How do we account for intersections?  Are they additive, multiplicative or something else?  Do all members of the group get assigned the same advantage/disadvantage rankings?  If not, on what criteria?  These are tremendously difficult questions.  I am not suggesting that they force us to abandon an egalitarian commitment to substantive, ex post equality—quite the contrary, in fact.  We do have to face them if we want to reduce the inequality in this world.  My point here is that, by depicting just these three fans watching a baseball game over a fence, one tall, one medium, one short, the graphic is a dishonest guide to navigating actual situations.

My bottom line is that, while I agree with the spirit of the graphic that policies, whether at a single office, a large institution or an entire country, should take account of the inequalities people face in real life and try to compensate for them, how and how far to go is difficult to resolve.  Achieving ex post equality is complicated in the face of so many factors that affect our chances in life, and on top of this, equality is only one of many values we ought to respect.  The real world politics of affirmative action, targeted (as opposed to universal) benefit programs and the like reside in these complexities.  The equity graphic conveys the initial insight, but the assumptions packed into its story make it harder rather than easier to think through the controversies that bedevil equity politics.

Whither Lebanon?

Yeah, yeah, yeah.  I should probably write about the "big successs" we have in Northeastern Syria thanks to Vladdie Putin talking the Turkish president, Erdogan, into holding back some from his nation's invasion of Kurdish territory.  But, heck, it is still hard to know what is going on there.  So instead I am going to look at events happening in Lebanon mostly under the radar, but that are both connected to the broader war in Syria as Lebanon has been challenged by receiving over a million refugees from that war, but also is experiencing something that resembles events happening in several other nations and that may lead to deep changes in that complicated and  long-suffering nation, things that may actually be hopeful for an improved future, more likely than what is happening to the Kurds in Northeastern Syria.  Lebanon is experiencing massive street demonstration involving hundreds of thousands of people.

Lebanon became independent from French rule in 1943, having been carved out of the Ottoman province of Syria by them following the 1916 Sykes-Picot Agreement with the British in order to favor the elite Christian Maronite group, who follow eastern rites but are under the Catholic Church, with the wealthy Maronites having had close relations with the French dating back to the Crusades.  With 18 recognized ethnic/religious commuities, the French set up a system based on these groups, but favoring the the Maronites, then the largest group.  The president, as well as the Chief of Staff of the military and the Head of the central bank, were to be Maronites.  The premier would be from the then-second largest group, a Sunni Muslin, and the Speaker of the parliament would be from the poorest group, the Shi'a, who were predominant in the South next to Israel.  The Sunnis would increase in population as waves of Palestinian refugees entered, fist in 1948, and then in 1970 after the failure of the Black September uprising in Jordan, with the PLO taking power in various parts of Lebanon then.  However, the poor Shi'a would become the largest group in population. 

In 1975 civil war broke out initially between the Maronites and the PLO, but various groups sided up up with each other, with some ethnic groups split among themselves, including the Maronites.  The war lasted until 1990, when entry by Syrian forces largely brought it to an end following the 1989 Taif Agreement, which promised that a Senate would be formed that would be led by someone from the nation's fourth largest group, the Druze, but this never  happened.  An important group coming out of the civil war was Hezbollah, the Shi'a group backed by Iran and founded in 1982 to oppose both Israel and the PLO.  Over time it would become the strongest militia and political group in Lebanon, long led by Hassan Nasrallah, and now the most important group in the government, operating through an alliance with current Maronite president, Michel Aoun.  The premier is Saad Hariri, son of a premier assassinated in 2005 by the Syrians, which led to the Cedar Revolution, a massive uprising that led to the Syrians largely leaving, although now the population has surged due to the arrival of many mostly Sunni Syrian refugees from the war.  The current premier also was briefly detained by Saudi Arabia's Crown Prince, Mohammed bin Salman, nominally his  ally.

Out of the war and its aftermath, the barely-ruled nation came to be dominated by a corrupt elite from a small group of families from each of the main ethnic groups.  The economy long ago fell into a kind of permanent stagnation, with many public services barely functioning and one of the largest foreign debts/GDP in the world, with these elites siphoning off massive via their corruption.  Anger over this erupted over a week ago fallowing a proposal to raise taxes on phone calls on Whats App.  The demonstrations have crossed party and ethnic lines, with hundreds of thousands in the streets and now calling for a complete replacement of the current regime and all its main leaders and groups, including Aoun, Nasrallah, and Hariri.  This is profoundly potentially hopeful, although where all this will lead remains unknown and unclear.

Curiously this parallels similar demonstrations going on in quite a few nations, nearly all of them initiated by a proposed or actual tax increase, with the Gilets Jaunes ("yellow vests") in France arguably an earlier inspiration.  Such demonstrations, most of them also massive and ongoing, are going on in Ecuador, Chile, Haiti, with also the somewhat related but also somewhat distinct ones in Hong Kong as well.  In short, this is a globally widespread movement that looks to shake up  governments and systems in many nations.  However, the one in Lebanon next to Syria that is still experiencing war that directly impacts it may have the largest demonstrations with those making maybe the most serious demands of any of them.  The long troubled nation of Lebanon now stands at the epicenter of a global upheaval of potentially enormous significance.

Barkley Rosser

Mike Pompeo Reminds Me of Al Capone

How to say in Latin that our Secretary of State is pompous and dishonest as it gets? Oh yea – if one says “quid pro quo” in English, it never happened. These unbelievable stupid excuses for denying what is plainly true – that Trump extorted dirt on Democrats from Ukraine by withholding military aid – is insulting as they are treating us like “chumps” to paraphrase Leon Penatta. But even more insulting is this:

Secretary of State Mike Pompeo fiercely criticized the House impeachment inquiry, saying his department is being treated unfairly as Democrats seek to remove President Donald Trump from office ... “They’re not letting State Department lawyers in the room ... they have not let State Department lawyers be part of these hearings,” Pompeo said. “That’s unheard of ... I haven’t seen you all report that.”

First of all, we do know that the brave members who served the State Department honorably have turned down Pompeo’s lawyers in lieu of bringing their own so this last sentence of his is a lie as this fact has been reported on. Secondly, Pompeo is whining that HE is being treated unfairly. Look Pompeo is clearly a mobster style criminal – hence my reference to Al Capone. Can you imagine a grand jury investigation of a mob boss where the mob boss gets to send his own lawyer into the testimony before the grand jury? Witnesses might be reluctant to appear out of fear that the mob lawyer would tell his client who to knock off. Pompeo is all about witness intimidation as he fears the truth. And yea – I bet Pompeo and his boss (Trump) would stoop to killing anyone who dares to stand up to their treasonous crimes.

The Ultimate Solution

Yes, Trump really said that.  The Syrian Kurds, who have been where they are about to be ethnically cleansed out of, are welcoming "the ultimate solution," just like Jews in you know where were welcoming "the final solution."  Of course they must accept this because they are "no angels," "communists," and "worse then ISIL." So much for a "post-socialist" Bookchinite cooperative system.  But, hey, they are all so fortunate to have "the ultimate solution."   What else is there to say?

Barkley Rosser

An Increasingly Divergent US Economy

Lots of people have been huffing and puffing about whether or not the US economy will go into a recession in the near future, with Menzie Chinn and Jim Hamilton at Econbrowser saying it is now about 50-50 whether or not the US economy will go into recession by the end of 2020.   I do not have a horse in that race, but I am struck that a new odd phenomenon has recently appeared in the US economy, a split between sectors regarding their performance that recently seems to be increasing.

The sectors are manufacturing, which has been declining now for several months, the harbinger of recession, and housing starts, which has more recently been showing an acceleration of growth that may well hold off any recession if it continues to accelerate.  It is unclear which will win out.

The manufacturing decline has been widely tied to the trade wars, which would appear to be at least partly responsible.  It is also the sector that through trade may be experiencing the pressures of the slowing of global growth.

However, ironically the recent increase in housing starts may be a result of the fears of recession that have been mounting recently, along with the Repo Ruckus that happened last month.  The upshot of these has been a change in Fed policy towards stimulus, with target interest rates being gradually moved down while the Fed has also stopped reducing balances and has been actively intervening in the repo markets to keep them stabilized.  In any case, housing is the most interest-rate sensitive sector of the economy, so it may be that this shift in monetary policy has triggered the uptick in housing starts that is now moving to offset the decline clearly apparent in manufacturing. 

This is getting interesting, and I am not going to forecast how it will come out.

Barkley Rosser

A Nobel for the Randomistas

I don’t think anyone was surprised by this year’s “Nobel” prize in economics, which went to three American-based specialists in the design of on-the-ground experiments in low income countries, Abhijit Banerjee, Esther Duflo and Michael Kremer.  I think the award has merit, but it is important to keep in mind the severe limitations of the work being honored.

The context for this year’s prize is the long, mostly frustrating history of anti-poverty projects in the field of development economics.  Much of the world, for reasons I’ll put to the side for now, is awash in poverty: billions of people lack access to decent sanitation, medical care, education and physical and legal protection, not to mention struggling to put food on the table, a roof over their head and cope with increasing demands for mobility.  A lot of money has been spent by aid organizations over the years to alleviate these conditions, without nearly enough to show for it.  (My specialty, incidentally, has been in child labor, which has been the focus of a large piece of this work.)

There have been various reactions to the lack of progress.  One has been to argue that the effort has been too weak—that we need more money and ambition to turn the corner.  This is Jeffrey Sachs, for instance.  Another is that the whole enterprise is misbegotten, a relic of colonialism that was always destined to fail.  You can get this in either a right wing (William Easterly) or left wing (Arturo Escobar) version.  (I critiqued the "left" stance on child labor here.)  A third is where this Nobel comes in.

Maybe the reason development projects weren’t working was because they had never been properly tested before widespread adoption.  Societies and the people in them are complicated, and ideas that may make sense in the abstract often fail in practice.  So really test them.  Set up controlled experiments, whose design will ensure that measured outcomes represent causal mechanisms.  One of the common elements of these designs was randomization of treatment to avoid confounding influences on who might be included in a program versus those in the control group, hence the term “randomistas”.

Without question, the experimental approach has produced genuine insights.  We have a much better sense, for instance, of the role played by institutional malfeasance in places like schools and hospitals: teachers that don’t teach, medical practitioners that don’t show up or follow protocols.  Just throwing money at organizations without reforming them is a dead end.  In fact, implementing programs to enhance their experimental value is central to the concept of adaptive management; it should be standard practice everywhere.

All the same, there are serious limitations to a strategy centered on experimental design.  Here are a few:

1. Good experimental design results in internal validity, where measurements actually measure the things they’re supposed to and confounding influences are suppressed.  External validity, the extent to which results can be generalized to a wider array of situations beyond the confines of the experiment is a different matter.  There are two specific aspects of experimentalism that raise questions on this front, the tendency for experiments to be small, local and time-bound (like a set of schools in one state in India in the mid-00's) and the effects of experimental control itself, when a sort of artificiality creeps in.  I’m familiar with the literature on experimentally designed conditional income transfers, for instance, where every new study, with a new country location, time period or set of design tweaks seems to alter the bottom line of what works and how.

2. The strategy of experimental design virtually requires a reductionist, small-bore approach to social change.  A more sweeping, structural approach to poverty and inequality introduces too many variables and defeats experimental control.  Thus, without any explicit ideological justification, we end up with incremental reformism when the entire social configuration may be the true culprit.

3. Carefully controlled social experiments can be very expensive!  When I read the work of the prize-winners and their coauthors, I often find myself wondering how much did it cost to do this research, and who paid for it?  This is a form of Big Science, and it requires big support.  That in turn lends power to the funding institutions, which can decide what problems and potential solutions deserve attention.  In addition, on-the-ground experiments depend on participation from the institutions being studied.  There is a tendency for randomista work to challenge the people on the lower rungs of hierarchy, like the teachers and nurses mentioned above, and leave their bosses—not to mention the elites at the top—unexamined.

On balance, I think it’s fine that this prize honors experimentalism, but we shouldn’t lose sight of the larger picture.  Using experimental methods to incorporate more learning in program administration should be standard practice; perhaps some day it will be.  But the big problems in poverty and oppression are too complex and encompassing to be reduced to experimental bits, and there is no substitute for theoretical analysis and a willingness to take chances with large-scale collective action.

Eeeeeeeeemoluments And How Bad Bruce Springsteen Is

I have almost never watched through a Trump speech to one of his rallies, but I was curious what he would say at the first one after the impeachment inquiry officially started, which he held a few days ago in Minneapolis, supposedly trying to take MN away from the Dems in 2020.  I missed the opening, but listened to all of it after that. 

Much of it was just boilerplate stuff he says all the time, much of it blatant falsehoods, but whart we have heard.  News reports focused on his especially nasty remarks about Ilhan Omar, who iis from Minnesota, so he made a special point about denouncing her and those supporting her pretty harshly.  But I want to mention are two odd items I saw no reports on, but that strike me as signs of Trump losing it, setting himself up for trouble in both the impeachment and if he survives that in the election next year.

The first involves the emoluments clause, something I would think he would not be saying anything about.  But he has long seemed to deal with problematic matters by essentially admitting the problems and then just doing a "So what? No big deal" line that he then tries to get established as the line for his followers at Fox News and elsewhere to spout and spread.  However, as with releasing the summary of the phone transcript with Zelensky, I think this may not work out so well for him as this is potentially another article of impeachment.

So there he went.  I do not remember what immediately preceded it, but then he said the word in this long drawn-out way as if to ridicule it: "Eeeeeeeeemoluments?  Then he said, "Whoever has even heard of this word?" (more attempted ridicule)  He then effectively admitted guilts, sort of, but clearly in a way to dismiss it.  "So what if some people I do not even know stayed in some of my hotels?"  Yes, this red shirt-wearing audience ate it up, if not perhaps as raucouslyi and enthusiastically as some other lines.  But there it was, and, of course, they ate up anything and everything he said.

I can kind  of understand this one as perhaps a strategic matter, getting ahead of something that is coming out and trying to frame it and brand it for his followers.  But the next one I really do not get.

He went after Bruce Springsteen, saying his name several times over with clear disgust and actually declaring him to be a "bad man." Really.  Now probably that is not going to be fatal to him, and he might even convince some of his followers not to like Bruce Springsteen, although his support of Dem candidates has been going on for quite some time, since long before Trump came along.  But offhand this strikes me as basically a stupid thing to do.  He really should have said nothing on this.  Springsteen is not only very popular, but he has that working class cred and all-American appeal from his "Born in the USA" days.  I mean really.  This is the sign he is losing it that he thinks he is going to gain anything by denouncing Springsteen.  This is just dumb, very dumb.  But there you go.

Barkley Rosser

Closing The Open Skies

Trump's stonewalling on impeachment is the top story, snore.  Lower down and more important is Trump allowing Turkey to attack the Kurds in Syria with the support of Russia. Even GOP senators do not like this and ISIS fighters may get out. But, heck, those will go to Europe, and unlike the Btis and Canadians, the Kurds did not help us out in Normandy in WW II.  And, probably most important, Trump has major business interests in Turkey.

However, much less reported (although covered by David Ignatius in WaPo today), but arguably more important than either is Trump's decision to withdraw from the "Open Skies" agreement with Russia to allow oversight flights by each over the other to test for "doomsday weapons" development, an idea initially proposed by Eisenhower in 1956.  This continues an ongoing collapse of nuclear arms control agreements, with Trump having withdrawn from the Intermediate Nuclear Forces agreement last year, much to the consternation of most of Europe, although arguably Russia had been in violation of it for a long time.  Back in 2002 Bush withdrew from the Anti-Ballistic Missile agreement, which his people thought was a much more important thing to do than fight al-Qaeda.

As of now there is only one remaining nuclear arms control agreement left between the US and Russia, the New Start of 2010, which puts caps on numbers of weapons.  It is due  to expire in 2021, and as of now no negotiations are going on between US and Russia, while both seem to be embarking on developing yet new kinds of strategic nuclear weapons.  This is a very dangerous situation.

The great irony is that supposedly Trump's friendship with Putin was to have improved world peace by their cooperation. But while Trump continues to defend Putin on almost everything from assassinating journalists to annexing Crimea to letting Turkey invade Northeast Syria, the two are frozen when it comes to arguably the most important issue between the two: controlling nuclear weapons.  All I can think is that both are totally under the thumbs of their respective military-industrial complexes.

Barkley Rosser

Medicare for All

The abstract for "Does Medicare Coverage Improve Cancer Detection and Mortality Outcomes?" by Rebecca Mary Myerson, Reginald Tucker-Seeley, Dana Goldman and Darius N. Lakdawalla:

Medicare is the largest government insurance program in the United States, providing coverage for over 60 million people in 2018. This paper analyzes the effects of Medicare insurance on health for a group of people in urgent need of medical care – people with cancer. We used a regression discontinuity design to assess impacts of near-universal Medicare insurance at age 65 on cancer detection and outcomes, using population-based cancer registries and vital statistics data. Our analysis focused on the three tumor sites with recommended screening before and after age 65: breast, colorectal, and lung cancer. At age 65, cancer detection increased by 72 per 100,000 population among women and 33 per 100,000 population among men; cancer mortality also decreased by 9 per 100,000 population for women but did not significantly change for men. In a placebo check, we found no comparable changes at age 65 in Canada. This study provides the first evidence to our knowledge that near-universal access to Medicare at age 65 is associated with improvements in population-level cancer mortality, and provides new evidence on the differences in the impact of health insurance by gender.

I can't vouch for the results, not having read the article in full, but the study design looks good, provided they avoided the spurious results from higher order nonlinear relationships separated by the discontinuity.

The Repo Ruckus

This is now about three weeks old news, but it is increasingly clear that it is not clear why it happened or if it will happen again.  There was an outbreak of completely unexpected volatility in the repo market, where in the past the Fed had carried out open market operations, although that had largely passed.  Indeed in more recent years when the Fed has intervened in markets it has been in the reverse repo market.  In any case, interests rates shot up as high as 9 or 10 percent at one point, with the federal funds rate also getting out of its allowed range on the upside, although not by that much.  The New York Fed pumped about $400 billion into the market to stabilize it, so there was no immediate fallout from this, and if it happens again, probably the Fed can do it again. Nevertheless, this is a sign of things going on in the markets that are poorly understood, and John Williams, the New York Fed president has come under criticism for not providing any clear explanations.

What we have are several theories, with what happened probably a combination of them.  The blowup seems to have reflected an out-of-the=blue liquidity crunch in the system.  One reason for lower liquidity is due to the gradual drawdown of the Fed balance sheet, which reportedly had declined from $1,6 to $1,4 trillion during 2019.  This was all part of a "normalization" effort by the Fed, which now seems to have halted.  A likely culprit for the crunch was the impending end of the third quarter when financial demands by many firms increase due to needing to pay taxes and also to make various portfolio adjustments prior to making quarterly reports, with these times in the year often seeing at least some increased pressures and volatility, if not usually on this scale.  Another factor some have proposed as playing a role is the capital requirements on big banks from the Basel III Accords, although these have never been a problem before. But the  problems do apparently seem to have emanated from larger banks, which is consistent with this aspect.  It may also be that there are things going on in the shadow banks that are aggravating the liquidity demands, although they remain shadowy as usual.

In any case, the effort to return to a supposed pre-Great Crash "normal" seems to be dead, for better or worse.  We are in a different system now, but exactly how it operates and what are the sources of its apparent new fragility remain somewhat unclear.  Whether this portends more serious upheavals and possible crashes and recession also are unclear.

Barkley Rosser

Drain the Ukrainian Swamp

Trump’s latest excuse for withholding arms for the Ukrainian government to defend itself against Putin’s invitations so he can extract dirt against the Bidens is what again? Oh yea – he wants to root out corruption. REALLY? OK – start with this:

KYIV, Ukraine (AP) — As Rudy Giuliani was pushing Ukrainian officials last spring to investigate one of Donald Trump’s main political rivals, a group of individuals with ties to the president and his personal lawyer were also active in the former Soviet republic. Their aims were profit, not politics. This circle of businessmen and Republican donors touted connections to Giuliani and Trump while trying to install new management at the top of Ukraine’s massive state gas company. Their plan was to then steer lucrative contracts to companies controlled by Trump allies, according to two people with knowledge of their plans.

Why Is Iraq Blowing Up Now?

Yes, Iraq.  It has not made front page headlines with so much else going on, but over the lat several days there has been an escalating series of protests against corruption in various parts of Iraq, but culminating yesterday in Baghdad with one that was met by soldiers firing openly upon the demonstarters with the result being about 104 dead and 6100 wounded.  The government of Adel Abdul Mahdi appears in danger of facing a no confidence motion and falling as it has lost the support of fellow Shia leader al-Sadr, who has a large faction of supporters in the parliament and how apparently is now supporting the demonstraters.

Corruption has become an increasingly widespread problem around the world, so much so that we increasingly take it for granted and get unimpressed by it.  And we are tired of hearing about Iraq, a nation we made a mess of but are now mostly not much bothered with, especially since it appears that ISIS has been largely defeated.  Indeed, opposition to the deep government corruption there laid low while the war against ISIS was on.  But now with its defeat, many want something done about it.

The way to realize the scalee of it is that Iraqi oil production has finally seriously recovered from all these wars, now up to about 4.5 million barrels per day.  That makes it fourth in the world with a bit less than half that the top three have: US, Russia, and Saudi Arabia.  Of course the US still consumes more than it produces, but other major producers, including many nations producing much less than Iraq, have large state funds accumulated from their oil export earnngs, many of which are being used to fund many useful things in their respective nations.  But no such fund exists in Iraq.  Billioins of dollars worth of earnings have simply disappeared.  Nobody knows where it has gone to and is going to.  The scale of this is truly immense, and when one stops to think about it, it becomes clear why there is such anger in Iraq now.  The nation has suffered decades of repression and war and destruction.  Peace has finally more or less arrived, and all this money is flowing in.  But none of it seems to be being used to fix up all the messes.

This is likely to get worse before it gets better.

Barkley Rosser

Does Bill Barr Need It in Writing?

I think we all know AG Barr lied about the Mueller report but permit me to go back to this:

The moment Attorney General William Barr laid eyes on a letter from special counsel Robert Mueller criticizing Barr's summary of his two-year investigation, he knew his goose was cooked. Mueller was creating a written record that wouldn't allow Barr to bastardize his concerns the way he had mischaracterized Mueller's report. “Bob, what’s with the letter? Why didn’t you just pick up the phone and call me?” Mueller didn't need to tell Barr what they both knew: Mueller now considered Barr an untrustworthy adversary—a liar, in essence. Going forward, Mueller was going to memorialize his views in writing

. Fast forward to how AG Barr handled the Whistleblower complaint:

The CIA’s general counsel made a criminal referral — or at least, she thought she did — of a whistleblower’s complaint concerning President Donald Trump’s interactions with Ukraine’s president. According to NBC News, which cited unnamed officials familiar with the matter, Courtney Simmons Elwood, the CIA’s top lawyer, considered her Aug. 14 phone call with high-ranking DOJ officials to be a criminal referral. However, unnamed Justice Department officials told NBC News they didn’t consider the conversation to be a formal criminal referral — because it wasn’t in writing.

Bill Barr is a pathetic excuse for Attorney General. We need to demand that he resign – TODAY!

The First Anniversary Of The Murder Of Kamal Khashoggi

There is a special section containing 11 columns in today's (October 2, 2019) Washington Post on the first anniversary of the murder of its former columnist from Saudi Arabia, Kamal Khashoggi.  I shall quote from some of these columns.

From "Khashoggi's horrifying final seconds" by David Ignatius:

"The authorization to kill Khashoggi, if that became necessary, came in a second order, from [Saud] Qahtani." [a top aide to Saudi Crown Prince Mohammed bin Salman aka "MbS"]

"What does Qahtani say about whether the crown prince authorized these actions? ... we can be guided by a  Twitter message Qahtani sent back in August 2017 when questioned about his activities: 'I am a trustworthy employee who carries out the orders of his boss."

From "Let the world hear his last words, in Arabic" by Karen Attiah:

[quoting Columbia University professor Hamid Dabashi]: "How does one scream in Arabic?" He wrote that Jamal's last words were not in Arabic or any particular language, but rather "were the primordial cries od a people from one end of the Arab and Muslim world to the next, maligned and brutalised by a system of tyrannical abuse."

From "Why we won't forget the horror of Jamal's murder" by Fred Ryan:

"...it will prove hard to forget the administration's unexplained snub of the CIA, the United Nations and Congress. Although the CIA's investigation, concluded with high confidence that [Crown Prince] Mohammed [bin Salman] ordered Jamal's killing, the agency's experts were ignored. The U.N. special rapporteur investigating the case declared that the United States is allowing itself 'to be made complicit in what is, by all appearances, a miscarriage of justice and called on the FBI to probe further. No action on the bureau's part has been announced."

From "We need justice for Yemen - and justice for l" by Tawkkol Karman:

"In my last meeting with Jamal, in Istanbul two months before his death, we agreed to make a joint effort to stop the war under the slogan 'Stop the war, stop the coup, stop the hunger.' I will not forget his words to me that day: 'I will help you with all I can, if not for Yemen, then for my country, Saudi Arabia, which has lost so much because of the war economically and morally."

From "How a crime has changed global affairs" by Asli Aydintasbas:

"But the real story is not about Saudi brutality; it is about the mealy-mouthed response from the West. What was truly shocking about the incident was the Western acquiescence to it."

From "Jamal Khashoggi's enduring truths," main editorial probably by Fred Hiatt:

"Mohammed bin Salman's policies are carrying him toward a dead end - maybe even a precipitous crash. Mr. Trump, mired in scandal and preoccupied with his reelection campaign, is unlikely to do much to help him. The crown prince might still rescue himself, but only if he finally heeds the advice Khashoggi offered him.  Release female activists and other political prisoners and punish those who tortutred them; end the war in Yemen; allow peaceful critics like Khashoggi to come home and speak freely.  Last but not least, the crown prince should stop offering half-truths and accept full responsibility for ordering the murder."

From "Saudi Arabia's dangerous monarchy" by Hala al'Dosari:

"The leadership has turned the capacity and skills of high-ranking officials, including consular staff and journalists, into tools of oppression. The media has beenfeeding ultranationalist sentiments to justify its domestic and foreign policy failures. No public discourse exists on critical issues, including the war in Yemen, the Saudi-led boycott of Qatar, or the enduring challenges of unemployment and poverty - let alone discussion on the trial of Jamal's killer or justice for political prisoners."

"The Saudi monarchy might claim to be forward-thinking with its Vision 2030 modernization plan and efforts to court Western leaders.  In reality, however, it has simply institutionalized a centuries-old monarchic legacy of violence, disenfeanchisement, and repression.  Jamal's murder and the torture of female activists have brought this to light."

Barkley Rosser

Peoples' Republic of China Reaches Age 70

While most US media  claims China (PRC) has the world's second largest economy, that is only true as measured in nominal terms.  Measured in real PPP terms, Chinese GDP surpassed that of the US in 2015 and contnes to move further ahead of it (and is likely to pass it in nominal terms very soon), despite gradual deceleration of the Chinese GDP growth rate.  Furthermore, PRC seems to be taking global leadership in crucial 5G technology.  In the last 70 years the PRC has gone from a poor nation wracked by regular famines to a solidly middle class nation with vastly reduced poverty and no famines for many decades (although there was an especially severe one in the late 1950s that killed millions in the early part of the regime).

I would like to put this anniversary into a broader historical perspective, in particular from a traditional Chinese view.  That is that while there have been exceptional periods, most of Chinese history has been driven by dynasty cycles, with the average life of a dynasty being about 300 years, as with the Tang, Song, Yuan, Ming, ans Qing (the Han lasted 400 years, some others for much shorter periods).  The classic pattern has been for the first century to be dynamic, with proper Mandarin civil service exams associated with a competent bureaucracy and effective management of the agro-hydraulic infrastructure, with a growing economy.  The second century involves a flattening out and slowing of growth.  In the third century corruption of the exams rises as does general corruption and stagnation as the incompetent bureaucracy mismanages the infrastructure and the broader economy, with all this leading to the Malthusian disasters of war, famine, and pestilence, and the eventual collapse of the dynasty.

In this perspective the Communists are a new dynasty, now getting into the later stage of their first century, although some would say the new dynasty started with the end of the Qing a century ago.  Of course technically that first post-Qing regime/dynasty survives in Taiwan, which has done far better economically than has the PRC.  In any case, the rapid growth PRC has seen since the Dengist reforms 40 years ago have been that initial dynamic phase of an early dynastic period.  What we are seeing now with the current slowdown is the move towards that second century regularization, which is marked by Xi harking back to the origin of the dynasty with Mao.  This is all the more so given the challenge posed by the  ongoing uprising in Hong Kong.

Beside Hong Kong and apparently Taiwan, the expansion of Chinese power and influence across much of the world, especially through the Belt and Roadd initiative, may be running into limits.  Reports from various nations, most recently Pakistan, is that many are becoming unhappy with the conditions associated with this initiative and are pulling back or resisting deeper involvement.  We shall continue to see Chinese growth and expansion of global influence, but this anniversary marks a point where the nature of this is changing to a more constrained path.  This will prove a serious challenge to the Chinese leadership, both while Xi is in power, but even more for his successors.

Barkley Rosser