Patterns 'R' Us

Scientifically Destroying Kids' Dreams

2009-08-25T16:45:00.002-04:00

Psychologists have demonstrated that it takes a vivid picture of the consequences of not achieving their goals to get students to finally give up on their dreams. (story here)

"Most people don't give up easily on the dreams. They have to be given a graphic picture of what failure will look like if they don't make it," said Patrick Carroll, co-author of the study and assistant professor of psychology at Ohio State University at Lima.

The article goes into some depth about how they structured the research study, what they told the students and how the students responded. It is quite interesting reading.

Destroying kids' dreams has now been scientifically validated and has a best practices toolkit.

Update: Yale Censorship of Danish Cartoons

2009-08-21T16:54:00.002-04:00

I wrote here about Yale University surrendering to Islamic Extremists by self-censoring a book on cartoons that shocked the world.

The update is some curious Saudi influence on the Yale campus. According to Martin Kramer's piece Some day, Yale's Prince Will Come Saudi Prince Alwaleed bin Talal is on an academic shopping spree, donating roughly $100 million to universities to set up Islamic studies departments and institutes. He's like an Islamic Studies Johnny Appleseed.

Apparently he has sent a subordinate to evaluate Yale for a potential 8 figure donation. Kramer wonders whether the prospect of a huge academic donation was the reason they put the kaibosh on potentially offending Saudi donors.

As Kramer says, "Yale's motto is lux et veritas, light and truth, but these days it might as well be pecunia non olet: money has no odor—whatever its source." Maybe Yale ought to consider updating their seal and their motto to reflect current goals and objectives.

Visualizing the US Grid

2009-08-20T09:44:00.001-04:00

NPR has a cool interactive map that provides the user with all sorts of information and visualizations of the US power grid.

Where are the solar power lines areas? Where are the wind power areas? What is the breakdown of power generation in each state? Where are the main distribution lines?

Robots Learn to Lie to One Another

2009-08-19T15:39:00.002-04:00

Scientists at Ecole Polytechnique Fédérale of Lausanne, France developed simple robots that search for a "resource" and avoid a "poison." Each robot has a 264-bit "genome" that determines its behavior. 1,000 robots were programmed with random "genomes" and then sent to find the resources and avoid the poisons. The ones that were successful were then mated together using genetic algorithms, where pieces of successful genomes are combined with other genomes from successful robots and add a random mutation as well (to keep things fresh and unpredictable).

The first generation of robots were instructed to turn on a light when they found the resource to alert other robots in the vicinity. By the 500th generation of mating/mutation of the genetic algorithms, "60 percent of the robots had evolved to keep their light off when they found the good resource, hogging it all for themselves. Even more telling, a third of the robots evolved to actually look for the liars by developing an aversion to the light; the exact opposite of their original programming!"

Genetic algorithms are not new. In fact, I worked with a colleague on some variations of the concept at my previous job. It's pretty cool stuff. Computer scientists have been looking at how behavior evolves over time based on genetic mutations, limited resources, and the like. So that aspect of the experiment is nothing new.

In my opinion, the cool new thing is that the scientists have programmed real robots with physical behavioral traits, rather than idealized agents in an agent-based modeling computer program. They demonstrated that the process of behavioral evolution, while fundamental to computer science, does in fact work in the real world when genetic algorithms evolve and environmental factors impact behavior.

Lying and detecting lying are two of the most crucial elements of behavioral evolution. It should not surprise us that simple models of robots that have the capacity to signal each other and look for limited resources could evolve their behavior to horde resources just like small animals.

Yale Surrenders to Islamic Extremists

2009-08-13T11:20:00.002-04:00

According to a New York Times article, Yale University Press will not publish the Muhammad cartoons that caused the uproar in the Muslim world (dozens of riots and hundreds dead). Not too surprising, but here is the twist: the book they are removing the cartoons from is a book titled "Cartoons that Shook the World."

Talk about irony. Yale supports publishing a book on important cultural and political cartoons, yet will not actually publish the pictures of the cartoons that offend some Islamic Extremists. Mind you, they are publishing every other cartoon and picture. Just not the ones offensive to some Muslims.

"He noted that he had been involved in publishing other controversial books — like “The King Never Smiles” by Paul M. Handley, a recent unauthorized biography of Thailand’s current monarch — and “I’ve never blinked.” But, he said, “when it came between that and blood on my hands, there was no question.”"

Reza Aslan, an academic supporter of the book who has since withdrawn his support over the actions of Yale University Press said this, "This is an academic book for an academic audience by an academic press,” he continued. “There is no chance of this book having a global audience, let alone causing a global outcry.” He added, “It’s not just academic cowardice, it is just silly and unnecessary."

I understand Yale's desire not to offend anyone. That has become one of the principle characteristics of higher education bureaucracy. It is nothing special and just has to be accounted for. The larger problem I see is that academic responses like these, though small and not with global reach, add up to a consistent perception to the Islamic Extremists. When conference organizers refuse to allow Geert Wilders, an outspoken Dutch politician and critic of Islamic Extremism, to come to our country to voice his opinions, the bad guys take notice. When the UK legal system cedes control of family law (marriage, custody, inheritance) to Sharia law administered by local imams, the extremists take notice.

There is nothing inherently wrong with the decision Yale decided to make regarding the publication of Muhammad cartoons. Yet, the combination of many independent and disparate actions all with the same mindset ("I won't offend your religion, so please don't hurt me or my loved ones") will lead to a tipping point. What that point is, I don't know. I just know that in a country that loves to pat itself on the back for freedom of the press and freedom of speech, we are doing a poor job of actually practicing the liberties enshrined in the Constitution.

Alternative Subway Maps

2009-08-08T13:29:00.003-04:00

I love maps. They are a compact abstraction of reality. They take an often unwieldy reality and compress the information to the essential bits and display it a form that can be used by people.

Google Maps, Google Earth, NASA Worldwind, and Bing (Microsoft) Maps are all an attempt to put as much information of the real world at the fingertips of the user. It takes terabytes (probably petabytes) to provide this streaming information at the touch of a button. But you have to credit map makers who still value the idea of the compression of reality into a small map.

That is why these subway maps of New York City and London are so cool and unique. They take essential information the user is looking for and compress it into a usable map using modern graphical techniques.

The New York map allows the user to enter an address and then it outputs a red-yellow-green topographical-looking map displaying ride times to various places throughout the city. The user can see where they can go in 0-10 minutes (red), 10-20 minutes (orange), etc. The map takes the idea of a topographical map which any hiker/camper or military person can estimate time from point A to point B because of the terrain, and applies it to the city of New York. Pretty ingenious if you ask me.

I wonder if this isn't a great idea to synthesize with the traffic algorithms already in use by most online maps (Google, Microsoft, etc.) Instead of just showing whether a road is green (no traffic) or various shades of non-green (e.g. red for slow traffic), it might be better to create a "terrain" map or "topographical" map of the city by ride time so users can understand where they can go in a certain amount of time.

That combination of technologies, topographical overlays for cities with traffic algorithms, may allow researchers to learn new patterns of traffic flow and population distribution over time if they take time-sequenced snapshots of the city over the course of a day, week, month, or year.

The London subway map is actually quite useful for a tube-rider if they printed it out. The map has dotted lines connecting tube stations that are actually 500 meters or less apart. What often happens, especially to tourists, is they get underground to take the tube and because of the abstraction of the map, do not realize they may be closer to their destination by walking above ground than waiting for the next train.

Subway maps alter the actual geographical distances in order to make room for text and provide an overall aesthetic to the map rather than capturing every jink, turn, or spur of the rail line. This map attempts to overcome that abstraction by linking tube stations that are actually close together above ground. Just looking at it you get the sense that many of the stations in the center loop of London are actually quite close and within walking distance.

The last subway map I'm interested in displays most of the world's subway systems on the same scale right next to each other. You can compare the subways of London, New York, Tokyo, Seoul, and Moscow all at the same time and on the same scale. It provides an interesting comparison of both the complexity of the subway systems and the relative size and sprawl of various megalopolis cities around the world.

For instance, you can see how expansive and sprawling London and Seoul are compared to many of the other world's cities just by looking at their subway maps. The Tokyo system, and to a lesser extent Paris subway system, are much more dense and complex than many of the other subway systems. The Moscow subway is quite an achievement of government planning with a central loop and multiple spokes going away from the center in a very logical way. This map comparison also demonstrates how dumb the Atlanta MARTA (subway) system is for a city of 4 million people sprawling over an expansive area.

Go visit these subway maps and think about how the creators are introducing new levels of abstraction using modern graphical techniques to the centuries-old tradition of map-making.

Pressure Sensitive Keyboard

2009-08-08T13:21:00.003-04:00

Microsoft Hardware has created a pressure sensitive keyboard. The creators are now opening up a student competition to see what innovative uses the students can come up with for this new keyboard.

The video demonstrates that applications:
-- Video games (the harder the key is pressed the faster you move)
-- Instant messaging (the harder the key is pressed the larger the font conveying emotion)
-- Word processor editing (the harder the key is pressed the more likely that was the correct letter the user meant)
--Intuitive deletion (the harder the backspace key is pressed the more of the word/paragraph is deleted)

This is a great invention that will eventually provide greater feedback mechanisms to the user and make the interaction of the human-computer interface more seamless. In fact, I'm surprised it has taken this long to invent a keyboard that is touch sensitive. But I suppose all truly great inventions are like that: they just naturally flow from the technological devices that already exist and become seamless with existing technology.

Amazing Pictures Are Actually Paintings

2009-08-08T13:16:00.003-04:00

These pictures are actually paintings by unbelievable artists. I swear they look like photographs. I have no idea how they are able to make their paintings look so real, but it's pretty cool.

Here are more portrait paintings by David Jon Kassan.

Here is a picture of a pool splash that looks like a photo.

Here is a time-phased portrait of a lady showing how the artist made the painting over time.

You have to admire the skill and expertise to make paintings that look so real normal people cannot tell if their photographs or not.

Genius Inventor Discusses Healthcare Reform

2009-08-07T12:01:00.002-04:00

Popular Mechanics published an interview with Dean Kamen on the health care debate occuring in this country. Dean Kamen is the inventor of the Segway, but has many other patents to his name. "His innovations include the first wearable infusion pump, a portable kidney dialysis machine, a more flexible stent, one of the world's most advanced prosthetic arms, and many other devices used in the treatment of diabetes, heart disease, cancer and other conditions."

Kamen's comments are the most sensible, reasonable, and logically coherent statements void of all political posturing I have ever heard enter the healthcare debate. Any person who wants a truly expert opinion on the medical innovation field should read Kamen's comments. They offer an entirely new perspective on the debate entirely lost between the Democrats bellowing that we need to fix healthcare now because costs are spiraling out of control and Republicans spewing comments about socialized medicine and single-payer healthcare.

With apologies to Popular Mechanics, I'm going to pull a few of Kamen's better quotes because people need to read them even if they do not go to the Popular Mechanics link.

"Our healthcare system has seen some of the greatest achievements of the human intellect since we started recording history: We're developing incredible devices and implantables to improve the quantity and quality of people's lives."

"I'd say, if we have a crisis, it's the embarrassment of riches. Nobody wants to deal with the fact that we're no longer in a world where you can simply give everybody all the healthcare that is available. Each side of this debate has created the boogieman and monsters, like "We don't want let this program to come into existence because that will mean rationing." Well, I hate to tell you the news but as soon as medicine started being able to do incredible things that are very expensive, we started rationing."

"We now live in a world where technology has triumphed, in many ways, over death. The problem with that is that it's enormously expensive."

"The whole debate is twisted. These guys want you to be afraid this is going up. We should celebrate that. These guys say, "We don't want to ration." You're rationing now. The way to ration less is to make more good technical solutions."

"Every drug that's made is a gift from one generation to the next because, while it may be expensive now, it goes off patent and your kids will have it essentially for free."

"I think this debate shows a fundamental lack of vision, a lack of confidence, a lack of understanding of what's possible. And it's being fueled and fed by vested interests of people that have something to gain by making the general public, frankly, afraid of all sorts of things."

Congressional Appropriators Deserve Are As Corrupt As Third World Kleptocrats

2009-08-07T09:21:00.004-04:00

The House Defense Appropriations Committee just released its budget after adding in about $3 Billion in pork (story here). Pork? Why not just call it what it is? Bribery. Because we have created an industry around this practice it's not bribery? Because the legal loopholes in Federal Election Commission law allow this money to be "donated" to a congresscritter it's not bribery? Because the men and women in congress sit in hallowed halls and occupy vaulted positions they are not taking bribes and doling out patronage because of the bribes? The only difference between Congressman Jefferson, who was caught in an FBI raid with $90,000 in his freezer and recently convicted on several counts of fraud, and the rest of the congresscritters is that he had cash in his house from a foreign contact in Africa. That's the only difference. When Ted Stevens, Republican from Alaska, got bribery money in the form of house furnishings from local businessmen, how is that different than what Congresscritter Jefferson did? It's only one step removed from cash, but it's essentially the same thing.

When soldiers in Iraq and Afghanistan use money from the Commanders Emergency Response Program (CERP) to help rebuild civic and social institutions, we all acknowledge it is essentially a bribe. We provide a bribe to a local sheikh, who will use the money to pay his guys for jobs they may or may not do, but who will not attack Iraqi government or Coalition soldiers. The polite term is patronage. The bottom line term is bribery.

We need to recognize that our elected leaders are just as bad as any Arab sheikh, Afghan tribal elder, or African strong man when it comes to bribery and patronage. The only difference is our leaders have institutionalized it in legal codes, economic interests, and cultural mores. The third world folks just have tradition.

It makes me so angry to see congresscritters put $200 million in pork spending in the defense bill for 3 luxury Gulfstream G-five jets. These jets are for ferrying congresscritters, their staff and family around the world in safety, privacy, and luxury. The Defense Department did not ask for that many jets to replace the aging ones (they asked for 1, not 3) and have other priorities for defense appropriated money, like healthcare for soldiers, more unmanned aerial vehicles, and better armed ground vehicles.

President Obama and Secretary Gates have done a wonderful job holding back the rabid dogs in congress from getting their rabies infected jaws on the F-22 program that was cut. Now with unprecedented deficits, and the DOD already trying to cut a significant number of high-profile programs, Congress has decided to act like Zimbabwe's Robert Mugabe by using taxpayer money to fly themselves in luxury jets after excoriating car manufacturers for taking private jets to congressional hearings.

I do not know where are our country or economy is headed. But I do know that congress buying itself three new Gulfstream luxury jets while our economy flounders we are involved in two wars overseas could at best be described as fiddling while Rome burns, and at worst as criminal bribery and outright neglect of duty.

UPDATE: The figures Wall Street Journal is reporting are much higher (link). Congressnow plans to spend $550 million on eight new Gulfstream luxury jets. These extorionists are out of control and need to be stopped.

Taking Down Twitter and Facebook To Silence One Man

2009-08-07T09:03:00.004-04:00

If this report is accurate, the denial of service attacks that brought down Twitter, Facebook, LiveJournal, Google's Blogger, and Youtube yesterday were actually attacks aimed at silencing one man's voice, a Georgian blogger by the name of Cyxymu (the name of a town in the Republic of Georgia).

This would be an escalation of "conflict" that has dizzying consequences for the internet, communication networks, and other networks. Hackers will have publicly crossed a threshold: they are willing to bring down the entire network in order to silence a single person from speaking. This is not cutting off your nose to spite your face, this is cutting off your head to spite your face.

If the story turns out to be true and the blogger the hackers were attempting to silence is in fact Georgian, I would have almost no doubt that the attacks originated from Russia, sponsored in part by their government (known for its collaboration and loose oversight of Russian hackers). Is this the next evolution in Russia's information warfare capability?

Evolution #1: In 2007 Russian hackers, according to some reports at the behest of the Russian government, attacked the communications infrastructure, financial networks, and internet in Estonia after a row erupted over moving a Russian statue. NATO experts said the hackers caused several million dollars worth of damage. Estonia even asked NATO to invoke Article 5 (which requires members to come to the defense of another member who is attacked) which was last invoked on 9/11.

Evolution #2: Russia invades the Republic of Georgia in 2008 with tanks, soldiers, airplanes, and integrated information operations campaign. Hackers and information warfare specialists took down Georgian government websites, blocked access to the internet in Georgia, and waged a information campaign to discredit the government and leaders of Georgia.

Evolution #3 (??): In 2009 Hackers use simultaneous denial of service attacks to take down Facebook, Twitter, LiveJournal, Google Blogger, and Youtube to silence one individual blogger from being heard.

That is a scary evolution and fast too.

Home Entertainment Trends

2009-08-05T12:30:00.003-04:00

The Futurist Blog has a 3-year report card analyzing his 6 year predictions for home entertainment by the year 2012.

The trends are: improving video game graphics, HDTVs at commodity prices, speech and motion recognition as control technologies, people migrating from television to gaming, some people earning money through games.

None of these trends is particularly surprising. Anyone who plays video games is intimately familiar with these trends. They are entirely mainstream. The catch is that to predict these trends several years before-hand is quite a feat. I think it is safe to say the home entertainment market and underlying technologies have reached the knee in the curve of exponential growth. We will not only see the trends listed above continue to grow and expand but new technologies emerge and combine in different ways.

The Futurist author describes machinima movies as another trend looming on the horizon awaiting creative, technologically sophisticated users to create them.

At the risk of being presumptuous, let me add a few of my own predictions.

Massively multiplayer games will spread beyond the realm of World of Warcraft (and others like it) and the Sims, to a wider selection and variety of games. As broadband connections make the technological connections possible and interesting game dynamics emerge from hundreds and thousands of interacting virtual people attracting more people, this prediction is not even that far fetched.

The social networking technologies (Facebook, Twitter, LinkedIn, etc.) will begin to link user profiles in the real world with user profiles in the gaming world so that people will be offered another way to expand their social circle.

Those are the only two predictions on my mind at the moment. Sorry to disappoint. Read more blogs from The Futurist for better predictions and more detail.

The Economic Crisis is Not a Perfect Storm

2009-08-05T12:09:00.003-04:00

Vincent R. Reinhart, of the American Enterprise Institute, writes an insightful article that says the analogy of the current economic crisis as a "perfect storm" is inaccurate and allows Fed Chairman Ben Bernanke off the hook.

The problem with the perfect storm analogy is that it suggests economics as a force of nature beyond our control, that can create storms from far-away regions that come together to destroy life, limb, and property. There are two problems with this analogy.

First, economics is the sum total of human actions in the pursuit of happiness on an individual level aggregated to certain levels of abstraction. Without humans, the earth would still have weather systems and storms. Without humans, the earth would have no economy.

Second, actions by individuals like Hank Paulson (Bush Treasury Secretary), Ben Bernanke (Fed Chairman), and Timothy Giethner (Obama Treasury Secretary) directly affect the economic system.

As Reinhart says, "That is why the metaphor of the perfect storm is inapt. The captain’s action does not influence the height of the waves. Bernanke, in contrast, participated in making and implementing interventions that worsened the financial crisis last year."

I have previously discussed the fact that the economic system, the stock market, the weather system, and the global ecosystem are both chaotic systems (sensitive to initial conditions) and complex adaptive systems (many independent interacting agents create non-deterministic emergent phenomena). Despite the fact that all these systems are similar, exhibit similar phenomena, and follow similar patterns (the power law distribution), that does not mean that the analogy of a perfect storm is appropriate for the current situation. Mostly because it neglects to portray Bernanke's and others' decisions as part of the system itself.

We must have a realistic and accurate portrayal of the economic crisis even if we are to use analogies as the foundation for understanding. The "perfect storm" analogy does not cut the mustard.

Alternative Energy: Where Salt Water Mixes with Fresh

2009-08-04T14:50:00.003-04:00

Cool article on a discovery about the ability to extract electricity from the mixture of salt water with fresh water. That would prove revolutionary because of all the fresh water rivers that empty into oceans in developing nations in Latin America, Africa, and Southeast Asia.

Scientists all say the ideas are sound, it is the practical application that will be difficult or nigh impossible. The biggest problem is the any renewable energy source that involves salt water or the ocean inevitably fails because the oceans are so corrosive.

However, as another potential stream of energy for humanity's insatiable demand, we cannot overlook any possibility.

CSI Science a Myth?

2009-08-04T14:05:00.003-04:00

According to this article in Popular Mechanics, the science behind the "bite marks, blood-splatter patterns, ballistics, and hair, fiber and handwriting analysis" sound compelling but have shakey scientific foundations, and there is very little body of scientific work to standardize anything.

"In recent years, legal experts have become deeply concerned about the accuracy of the “friction ridge analysis” central to fingerprint identification. Fingerprints are believed to be unique, but the process of matching prints has no statistically valid model."

"A subsection of tool-mark analysis, ballistics matching is predicated on the theory that when a bullet is fired, unique marks are left on the slug by the barrel of the gun. Consequently, two bullets fired from the same gun should bear the identical marks. Yet there are no accepted standards for what constitutes a match between bullets. Juries are left to trust expert witnesses. “‘I know it when I see it’ is often an acceptable response,"

"[Despite DNA's effectiveness] DNA constitutes less than 10 percent of the case load at U.S. crime labs."

I just finished a book called The Devil's Advocates: The Greatest Closing Arguments in Criminal Law History that surveys ten of the most important criminal cases in US history. It includes summations by John Adams, Clarence Darrow, and others. What struck me about these famous criminal cases tried so long ago was their sole reliance on witness testimony and the potential confession of the accused. It is comforting to know that the era of witness testimony in the halls of justice has been waning for years and the era of forensic science is ascendant.

It troubles me though to read something like that, demonstrating how little "science" has been done in the field of "forensic science." Of course there will be growing pains in any field. It took over 30 years from the discovery of the double helix to the conviction of a criminal based on DNA. I have even read articles that suggest the DNA system is not as foolproof as experts suggest (with its "one in 100 billion odds" theme).

What we end up with is a system predicated on shaky or faulty science, and thus the justice it dispenses becomes disputable and questionable. When we take away all the elements (witness testimony, forensic science, etc.)that have no foundation in stone we are left with little beyond logic. Even universal morality (people shouldn't murder) crumbles under the relativistic strain of morality present in our post-modern society. Thus, logic, conclusions derived from first principles, is the only thing left. Prosecutors and defense attorneys can bludgeon each others' witnesses and "forensic science" but they cannot pierce a tightly logical argument. This seems to be the last bastion of refuge amidst all the questions of validity concerning judicial evidence.

Century-Old Assumptions on Patents Questioned

2009-08-01T23:30:00.004-04:00

Researchers from UC Irvine and Kansas School of Law created a computer program that models the current patent system to test whether it really fosters innovation (story here). What they found may force us to rethink our long held assumptions about patent law. Their research suggests that the current system does not foster innovation, but in fact stifles it.

"The software allows players to simulate the innovation process under a traditional patent system; a “commons” system, in which no patent protection is available; or a system with both patents and open-source protection....In PatentSim, we found that the patent system did not work to spur innovation,” said Tomlinson, associate professor of informatics. “In fact, participants were more likely to innovate when there was no intellectual property protection at all, or when they could open-source their innovations and share them with other people.”

Of course there needs to be more research into this area of law before we do anything premature like upend a century-old legal tradition that helped create the industrial and information revolutions. However, this research further solidifies the idea that Linux and other open-source software are not aberrations. In an era of collaboration and communication on a global scale, patent law may be holding humanity back from even greater innovation.

Scientists Create New State of Matter

2009-08-01T23:23:00.003-04:00

Oxford scientists bombarded aluminum with an X-ray laser that knocked out an electron from every atom ultimately making it invisible to ultraviolet radiation. (article here)

What they found is that the material they created is actually a new state of matter. It has implications for astrophysics, planetary science, and nuclear fusion power research.

New Perspective on Artifical Intelligence

2009-08-01T22:51:00.003-04:00

This interesting article by Tom Barbalet poses an interesting view on artificial intelligence: "Survival is a far better metric of intelligence than replicating human intelligence."

"The simple rule in life is that survival (to reproduction) is the only meaningful metric." He discusses the pre-Cambrian biomass that figured out a way to survive and reproduce. Should that not be the gold standard for artificial intelligence?

Complex systems, with interconnected parts that enhance other parts until the sum is greater than the parts, can survive efforts to stop them by being robustly complex. In other words, taking out one node or even a series of nodes in the complex system will not bring the whole system crashing down. The measure of this "robustness" to failure is the measure Barbalet uses to define how survivable that system is. Pretty straightforward so far, at least within complexity science circles.

The next step he takes is the new perspective that ought to be considered far and wide by AI and complexity researchers. He says that any complex system, by virtue of its ability to survive attacks on its constituent parts can be considered intelligent. (Remember, survival is the key measure of intelligence.) Therefore, the more a system is able to withstand "attacks" on its parts the more intelligent it is.

He provides an example of the a road system or even legal system. It is a vastly complex network of interrelated parts that all rely on one another to make the whole work. A few crashes or police roadblocks is enough to bring down the road network. A few hundred people filing lawsuits by a polygamist group in San Angelo, Texas brought the legal system there to a grinding halt. Thus, these systems are not very robust or able to survive "attacks."

The internet is the sine qua non of the idea of a man-made system exhibiting complexity on a scale never before imagined by humans. To take it down would require far more "attacks" than the road system or legal system in San Angelo, Texas. Thus, according to the author, the internet is better able to survive and has a greater level of intelligence.

I think this metric of survival as intelligence ought to be considered in the AI domain as another dimension to measure advances in the discipline. From my own reading and research on the topic of complexity, robust systems that exhibit emergence, self-organization, and self-organization could be considered to have a level of intelligence as the system level. Ant colonies, the ecosystem, and the stock market could be said to have a certain intelligence as a system and are robust enough to survive "attacks" on its constituent parts. How you define the difference in levels of intelligence between an ant colony, the ecosystem, the stock market, or the internet is beyond me.

But suffice to say, I'm glad to see that the theory of complexity is being used a foundation for understanding intelligence rather than the traditional anthropological, psychological, or social theories on artificial intelligence.

I still think one of the best books on the subject is "On Intelligence: How a New Understanding of the Brain will Lead to the Creation of Truly Intelligent Machines" by Palm-pilot inventor Jeff Hawkins. His core idea is that intelligence is a memory-prediction model. The system stores memories of historical events and has a feed loop that uses these events to predict future events with an ability for error control. I'm sure there are ways to reconcile both the memory-prediction model with the survival as intelligence model using complexity theory as the foundation bridge. But I am not going to try here.

Survey of Augmented Reality for Cell Phones

2009-08-01T22:42:00.001-04:00

This website has a review and survey of many of the different augmented reality applications developed for cell phones.

If you have been reading my blog you know my interest in the subject, and maybe have read some of my other posts on the subject. (here, here, or here)

This website links to all the technologies I profiled and a few others. I will say it again: the technology of augmented reality is set to explode. All the elements are there needed to make it mainstream. Cell phones with massive computing power. Cameras that can be turned into viewfinders. Web linkage for information overlayed onto reality. Of course, the "wow" factor.

Running Robot

2009-08-01T22:40:00.001-04:00

Toyota has designed a robot that can run.

There is a video of it running. Pretty awesome stuff. In wonder how long it will be before it will be running after humans.

Russians Are Crazy

2009-07-29T00:41:00.000-04:00

Check out this stunt and be amazed and the ridiculousness of it.

Mach 2 in an open cockpit

Major Technology Breakthroughs on the Horizon

2009-07-16T23:20:00.003-04:00

This list of 12 blossoming technological breakthroughs is amazing if even a few only come to fruition. It includes technologies that allow people to breath underwater without limit, using carbon nanotubes woven into t-shirts to stop bullets, bionic hearing, bionic vision, exoskeletons, and more.

Turn Photos into 3D

2009-07-14T21:33:00.003-04:00

New software developed at the Queensland University of Technology in Australia can turn a series of two dimensional photos into a three dimensional image. It is called 3DSee. The best part is that anyone can log onto the website and use the software for free.

Basically the software tracks a series of common points from all the pictures and uses that to create a three dimensional image. The article offers a few promising ideas that include allowing museums to create 3D images of their displays for online viewing, and allowing farmers to make 3D models of their cows for display at cattle auctions rather than having to transport them long distances to auction sites. Another application could make it very easy for people to create 3D models of their face or their body for online avatars.

Obviously there are a host of things one could do with an easy to produce 3D image. If this technology catches on, I am sure we will see totally unexpected new directions for what people determine is valuable to see in three dimensions using just photographs as the source.

Rap Around the World

2009-07-14T21:13:00.003-04:00

This website has an interesting sampling video of 30 rap songs from around the world. As an artistic form, rap is a relative new comer only around for a few decades, but it has spread to virtually every corner of the world.

This sampling demonstrates the similarities and differences between the American form and those from other countries. What strikes me about this video is how similar all language sounds in rap form. Now I don't listen to a lot of rap, but I familiar with some of the more popular US songs. For the most part I cannot understand at least half of the words in any American rap song, so it I don't find it worrisome that I cannot understand a single word in any of the other sample songs.

If you listen to each of the songs, they tend to have the same cadence and often try to rhyme similar syllables (I read somewhere that there are only like 50 syllables capable in any human language...I may be off by a little but the principle is the same). So even though Finnish, Portuguese, and Russian all sound different, they merge together sounding very similar in a rap song. Interesting to hear all those languages side by side.

848 Mile Golf Course

2009-07-14T21:01:00.002-04:00

Nullabor Links in Australia can boast the longest golf course in the world....at 848 miles and 171 yards. (I like the fact that they measured the last 171 yards too. Story here)

The course is 18 holes spread out across the southern portion of Australia. The players will have to drive from green to tee, sometimes staying overnight before they play the next hole. The players will get to experience the breadth and width of Australia with holes along the ocean, in the desert, and one in the middle of a sheep station.

I think this is a fantastic idea. What a great way to experience the varied geography and wonders of Australia while playing a single round of golf. In fact, I think it is such a great idea the United States ought to have a course just like it.

How cool would it be to have the first hole along the rocky coast of New England, the second in the shadow of New York City, the third in the off the wooded Appalachian Trail, and so on across the country. The course could span the entire country, taking foreign visitors on a tour of this magnificent country while playing a little golf. Of course, the round of golf would probably take more than a week.

Or maybe you have 27 holes scattered around the country (or 48 if each state lobbied for their own) and you could mix and match them for proximity for a tour of the west, or an east coast links, or a plains state course. I think this idea has potential and what better country to do it than the one that thinks bigger than any other.

Congress-Critters Represent the People Poorly

2009-07-12T15:22:00.002-04:00

House Majority Leader (D-Md) Steny Hoyer said that the health care reform bill before Congress would garner very few votes if everyone was forced to read the legislation, laughing at the absurdity of asking every member of the House to consider such reading part of the job. (story here)

“If every member pledged to not vote for it if they hadn’t read it in its entirety, I think we would have very few votes,” Hoyer told CNSNews.com at his regular weekly news conference.

Hoyer found the idea of the pledge humorous, laughing as he responded to the question. “I’m laughing because a) I don’t know how long this bill is going to be, but it’s going to be a very long bill,” he said.

Congress-critters make me physically ill when I read news articles like this. I just watched several episodes of the miniseries on John Adams with Paul Giamatti playing the Adams. Not only would he be ashamed of every single member of the House of Representatives, I hope he would beat them upside the head and kick them out on to the street (all while being erudite and waxing philosophic).

Here is my simple question: how can a member of congress uphold their duty to the Constitution and duty as representative of the people of their district if they are not even willing to read the documents they sign into law?

Clothing That Takes Pictures

2009-07-12T15:17:00.004-04:00

Cool new technology (here) invented by MIT researchers that turns textile fabrics into cameras. Light sensitive fabrics woven into clothing can detect different frequencies of light to create a synthetic picture.

The article makes it appear that the project is funded by the Department of Defense to help soldiers detect threats from many more directions than where their eyes are currently looking. I am not sure how that would work, nor does the article really explain it, but still cool nonetheless.

F-22 Has More Problems

2009-07-12T14:57:00.003-04:00

According to this Washington Post story, the F-22 is plagued with higher maintenance costs and problems associated with its radar absorbing skin.

The Air Force admits that the per flying hour cost of the F-22 is $44,000, while the Office of the Secretary of Defense says its more than $49,000. For comparison, the F-15, the predecessor to the F-22, only requires about $30,000 per hour flight cost.

Not only does this cost per flight hour become prohibitively expensive the more we fly it, it is far higher than the estimates the Air Force and Lockheed put together in the early stages of the program. In other words, the program manager low-balled the estimates to get Congress to approve it and said "oh well" when the costs soared.

Moreover, the maintenance costs usually come down during the life of a program like this as the technicians figure out more efficient ways to fix the little things on the aircraft. One of the reasons that has not happened with the F-22 is that it has serious problems with its radar absorbing skin, including a vulnerability to rain. Yeah, rain...the deadliest of nature's chemical weapons.

A Lockheed specialist in stealth coatings has filed a suit claiming that the company knew its coatings "were defective while hiding the failings from the Air Force." The suit is still ongoing.

Lastly, the Pentagon said that 64 percent of the F-22 aircraft are mission capable. With that kind of mission capable rating for an aircraft that has never flown a combat mission in eight years of war in the Middle East and Southwest Asia, a host of maintenance problems, spiraling flight hour costs, and the fact that the Defense Department does not even want any more than the 187 it has already purchased, it is a wonder our elected representatives are trying stuff more pork into the Defense Authorization bill.

This is the type of information that one can only hope will turn congress-critters who are on the fence in direction of "nay" and provide political cover to those already in the "nay" camp. We need a serious national defense and the F-22 is not it.

More Ridiculous Augmented Reality Technology

2009-07-09T20:00:00.004-04:00

The progress on augmented reality for personal cell phones that has been reported in the media in just the past few weeks has been staggering. I suppose its the next big frontier to be explored in programming and business circles.

Keep it coming. (hat tip Rick)

Augmented reality concept unveiled

Non-Governmental Intelligence Gathering

2009-07-07T21:34:00.003-04:00

Intelligence analysts from Jane's Defense Weekly looked at commercial satellite imagery to determine that the T-72 tanks from MV Faina, which was hijacked by Somali pirates, are being staged northeast of Nairobi, Kenya on their way to Southern Sudan. (story)

I would be willing to bet that many intelligence agencies and the US military knew where those tanks are, but obviously are not sharing it with the rest of the world. The difference is that now non-governmental organizations have the wherewithal and the access to high grade commercial satellite imagery to compete with governments in analysis of military and security situations.

One major difference between government military/intelligence gathering capabilities and non-government/regular citizen intelligence analysis are the numbers of people devoted to such pursuits and their access to recent imagery. The more people have access to such imagery, the more we will see quality intelligence analysis coming from the private, non-governmental, or joe-shmo sectors.

Call this the decentralization of intelligence analysis.

Augmented Reality Goes Mainstream

2009-07-07T18:31:00.004-04:00

A new iphone application just became available to the public that uses augmented reality overlays to display where the nearest London tube stations are (story with video). The application combines the GPS, internal compass, camera, and computer graphic overlays to display in real-time the closest tube stations when you point the iPhone in a certain direction in the city of London.

I would expect that most major cities will have a similar application by the end of the year, or at least one year from now, given the current state of technology and media maelstrom surrounding augmented reality applications.

The augmented reality technology is benefiting greatly from a new perspective on an old technology: the camera. Think about how many years phones have had camera in them. Then think about how many years internet connectivity has been available on phones. GPS has been on handheld devices for over a decade. All it took was a change in perspective from the camera being a framing device with the intention of capturing a moment in time (or a 30 sec video clip) to being a viewfinder, or a portal between the real-world and the plethora of information on the internet. I am positive we will see some fantastic progress and innovation in mobile augmented reality over the next few years as people invent new ways to use the vast information on the web and combine it with mobile communication devices.

(hat tip Rick)

Nano-Progress

2009-07-07T18:25:00.003-04:00

"Scientists from Israel's Technion University have unveiled a tiny robot, made using Micro-Electro-Mechanical Systems (MEMS) technology, purportedly able to crawl through a person's veins in order to diagnose and potentially treat artery blockage and cancer." (story with pictures)

This is exactly the type of progress that will occur towards a revolution in nanotechnology in a decade or two. The device is one millimeter and can be controlled from outside the body. Obviously there are other applications beyond exploring the human body (searching for liquid leaks in urban water distribution systems), but the invention of such a device is an important milestone towards the miniaturization of technology.

Keep your eyes posted for more stories like these.

US Aid Will Backfire

2009-07-01T22:56:00.003-04:00

The United States is seeking to fund democracy movements and human rights organizations in Iran to bolster the demonstrations we have seen over the past few weeks.

Boy, is this the wrong maneuver. I work in an office that is intimately involved with USAID and the State Department in funding foreign governments and non-governmental organizations to promote US interests and build partner capacity to reduce under-governed areas and thus dry up the swamp for terrorists. The US has numerous programs and funds millions, and sometimes billions, worth of aid to these governments and organizations.

However, the idea of funding democracy movements or human rights organizations in Iran right now is just plain dumb.

The same argument that is used to counter the promotion of using psychological operations or information operations on certain population groups could be used to counter this idea for aid to Iranian groups: when US fingerprints are on a program the population you are intending to help or influence often has a visceral negative reaction. People do not want to receive their information or messages from a military or government program without knowing about it. Neither do they want aid for organizations that will only stir up more government comments about "US meddling in Iranian affairs" and provide a pretext for the Iranian government to crack down on dissidents even harder.

This is the catch-22 of US foreign aid. Most of the time, in order for a movement or organization to succeed, US fingerprints (re: money) cannot be on it. US aid sometimes achieves exactly the opposite effect of what we intend because of where the money is coming from.

This should not be surprise. Just look at the governor of South Carolina's position on bailouts and subsidies to state governments (well, before his affair anyway). He did not like where the money was coming from, the federal government, and thought it would have too much influence over states' rights. The "where" of the money was the corrupting factor and ultimately led to his rejection of much of the stimulus money for his state.

This same mindset is present in all people, especially ones we are trying to "influence" overseas. If the US wants to promote democracy and human rights, often the best thing to do is keep the federal government's hands off.

Record Breaking Solar Cell

2009-07-01T22:53:00.002-04:00

A company has created a new type of solar cell designed to tune itself to light from a particular latitude. This new cell has broken a 21 year old record on solar cell efficiency for a certain type of cell.

Again, the engineers and scientists put to shame any simple calculation on what is possible and what is not with technology.

Ants Are Taking Over the World

2009-07-01T22:49:00.002-04:00

Cool article about super-colonies of ants that stretch across every continent around the world, except Antarctica.

The ants are originally from Argentina and have a penchant for creating super-colonies that stretch for hundreds of miles. Researchers have found that the ants from Japan, California, and Europe are friendly to one another like "old friends."

Looks like we are the only species to spread across the earth, multiply, and alter the environment according to our wishes.

The Ascent of Money

2009-06-30T10:51:00.003-04:00

I got Niall Ferguson's "The Ascent of Money" over the Christmas holiday as a gift. What a fantastic book. Ferguson is a first rate historian, but also a compelling story teller. He wrote a controversial book about World War I, The Pity of War, that blames Britain's ambiguous foreign policy rather than Germany's belligerance as the cause of conflict.

His newest book about money traces the human invention of barter, coins, money, credit, markets, stock, insurance, and more throughout civilization's evolution. There are many references to the current (2008 at the time of writing) financial and economic crisis to provide context for historical events. Eventually he demonstrates that bubbles are a naturally occurring part of the system and that if you accept free markets you accept bubbles. Luckily, an open market will be quicker to rebound and gain broader momentum than the restricted growth potential of any other type of economic system.

If you cannot or will not read the book, I recommend watching a multi-part series online that summarizes much of "The Ascent of Money."

Ron Paul Wants to Edit the Fed

2009-06-30T10:38:00.002-04:00

Representative Ron Paul, who's underdog political campaign came to an end a year ago, has a new piece of legislation, popularly know as the "Audit the Fed" bill. Amazingly, it has drawn support from 244 other Congressional representatives acting as co-sponsors, including major Democrats and Republicans. Consider that the controversial Cap-And-Trade bill recently passed by the House only did so by the thinnest of margins, 219-212. Thus, 244 is quite an impressive achievement of support for more transparency of the Federal Reserve.

No one knows what the balance sheet of the Federal Reserve looks like. It is now buying Treasury notes that it is trying to sell on the market (creating the potential for inflation). Because the Federal Reserve lies outside the traditional space of public institution like one of the three branches of government or the private space of a bank. Each is required to maintain certain levels of transparency about its assets, debts, and cash flow. The Fed, because of its unique roll has much less stringent transparency reporting requirements.

244 representatives is impressive. It is only a start. Paul will need to marshall even greater support if his bill is to overcome the executive branch's inclination to keep the Fed's books closed.

EPA Hides Dissent on Global Warming

2009-06-29T20:58:00.005-04:00

CNET is reporting that the Environmental Protection Agency suppressed a report skeptical of claims of global warming. Can you imagine if the Bush administration suppressed a an environmental report that supported global warming? That would be HUGE news.

This actually does not surprise me at all. It is just another piece of evidence that global warming is a political issue rather than a scientific one. If it were a true scientific issue then there would be open debate and countering viewpoints until truth emerged. That is how science works. Instead, scientists have become ensconced with politicians because they see one side of the issue as a venue for advancing their political agenda. And that type of science sucks and has always suct.

Look how foolish the Catholic church looks several hundred years after Galileo and Copernicus demonstrated that the earth revolves around the sun and not the other way around. Instead of letting scientists study the issue in order to determine the nature of reality, the church advanced its political agenda in support of one side of the issue because it had implications for the basis of their power. You could make a case that the proponents of global warming are something similar.

Science is about asking questions and posing hypotheses, not coming to a conclusion despite contradictory evidence and then ignoring it to support a political agenda.

I think anyone who is interested in the topic of global warming ought to read Bjorn Lomborg's book "Cool It: The Skeptical Environmentalist's Guide to Global Warming." It addresses the issue scientifically and politically without charged emotion. He admits global warming is occurring it is serious and an important problem, even though I disagree with his assessment, but that in a cost-benefit calculus there are myriad of other issues that ought be addressed first with limited resources.

It saddens me to see the scientific community so polarized over this issue of politics rather than devoting time, energy, and resources to understanding nature. One can only wait and hope the scientific community sheds its pursuit of power and political influence in search of a higher calling for the pursuit of truth.

Lighweight, Denser Batteries On the Way

2009-06-28T11:54:00.001-04:00

Technology Review article on Lithium-Air batteries

Keep it coming.

The Revolutions in Technology on the Horizon

2009-06-28T09:55:00.002-04:00

This article in The Atlantic follows a familiar pattern like the writing of Vernor Vinge or Ray Kurzweil. Jamais Cascio writes this 4,000 word essay about the future and the developments in technology, humanity, and social relations he believes will occur now that we do not have to rely on natural evolutionary processes but “can do it for ourselves.”

Cascio discusses two of the GNR triumvirate that Kurzweil says are the driving factors in future development in his book The Singularity is Near. (GNR refers to Genetics, Nano-tech, Robotics which includes artificial intelligence) He limits his essay to genetics and pharmacological changes to emotions, behaviors, talents, a la Brave New World with a positive spin on it. He also discusses the emergence of a superior non-biological intelligence (AI) that will truly depart from the thousands and millions of years of natural evolution, an event termed “the singularity” by Vernor Vinge (because like the singularity in physics or math, one cannot see beyond it and all prediction and models break down as you approach it such that non-sensical conclusions emerge right at the singularity).

It is a long article, but will give you a nice flavor of the futurist genre and the type of writings they do. The article will help the reader survey the myriad patterns an author could focus on if he or she so chose. For instance, Cascio focused on pharmacological enhancement, internet enhancement, intelligent digital personal assistants, artificial intelligence, information overload and data mining, the cultural differences between enhanced humans and non-enhanced humans. He could have also discussed space pioneering, nano-technology, alternative social organizations, evolution of religion, and on and on. So keep a skeptical eye on any futurist, but understand that they are taking the patterns they see and drawing the thread out further in a unified vision of how the world will be when they are old and gray.

There are a few concepts Cascio discusses that I would like to highlight and comment on.

I just bought a book called the Economics of Attention. I don’t know what its about other than the title (yes, I do judge a book by its cover and often buy or don’t buy a book based purely on the title and the cover….I’m a cover-ist). I imagine that it has to do with the information overload we all feel at some point. Our senses are being stimulated an overwhelmed by images, sounds, and information at a rate unprecedented in human evolution and our minds sometimes cannot cope. A friend of min told me about a business professor he had who used the concept “attention units” when referring to someone’s ability to multitask or receive stimuli. I really like that concept and think about it often when I think about the number of issues that cross the president’s desk. Cascio writes that Google is not the solution or the end, but rather the beginning. It was the first major successful attempt at organizing the ridiculous amount of information on the internet. There will be others, and technologies that help someone manage their attention units will be a big technological leap now that we already have a ton of information “out there.”

I’m sure you’ve all seen those motivational posters that have a cool picture with black borders and a saying like “Teamwork,” “Perseverance,” or “Leadership.” I am also sure you’ve seen the clever and funny posters mocking the inspirational ones called demotivators. There is one in particular I am thinking of now that says—“Motivation: If a pretty poster and a cute saying are all it takes to motivate you, you probably have a very easy job. The kind robots will soon be doing.” (Note: I kept this on my shelf above my desk for several years at work) This quote from Cascio made me think of that, “Any occupation requiring pattern-matching and the ability to find obscure connections will quickly morph from the domain of experts to that of ordinary people whose intelligence has been augmented by cheap digital tools.” Think of the evolution of arithmetic and the ability to do it well as qualification for the title “smart.” Students had to memorize tables and equations. Then slide rules helped with complicated relationships like logarithms or trigonometric functions, but still required skill. Then simple calculators reduced the need to memorize simple functions like multiplication or division. More recently calculators can plot 3D graphs of chaotic fluid dynamics in seconds. So how is someone who can add, subtract, multiply, and divide very fast any “smarter” than a person with easy access to a computer or calculator? Increased access to technology and calculating machines will only further alter and transform what humans use as a measuring stick for someone who is “smart” and it will only become squishier with all the non-biological aids at their fingertips.

Robert Wright wrote a book called Non-Zero about the evolution of civilization being driven by non-zero-sum interactions in the technological development of energy, transportation, and information. Non-zero-sum interactions are ones where the parties involved are incentivized to cooperate on some level rather fight. They are most easily demonstrated in the area of trade because for each transaction both parties benefit from the transaction rather than to not cooperate over the conditions involved. The GNR revolutions on the horizon are interesting to me because if the authors (Kurzweil, Vinge, Cascio and others) are right then society has shifted to a point in its civilizational development from further advances made by technological leaps in energy, transportation, and information to one in which genetics, nanotechnology and information are the driving factors. This inflection point would certainly make our current generation important in the history of civilization for bringing about this shift in technological advancement.

The last point I wanted to highlight is that Cascio makes a good point about the further divergence between the “haves” and “have-nots” because those developed countries with technology and infrastructure can take advantage of the coming GNR revolutions, while the less developed countries (third world) cannot. Increasing returns is the concept that underpins the ability of the developed nations to out distance the less developed nations. In other words, the rich get richer while the poor get poorer. Those who have money, technology, rule-sets and other elements of infrastructure can take advantage of technological advances, while those without cannot.

One final thought. Maybe it is more important to lead the developing nations through the traditional civilizational advancements in energy, transportation, and information before we worry ourselves with bringing them through the genetic, nano-tech, and robotics revolutions on our doorstep.

Science Journalism Faces Tough Questions

2009-06-25T21:43:00.004-04:00

Science journalists are facing stiff competition from bloggers, twitterers, and other assorted everyday folks. These journalists typically cover science conventions or conferences and have strict limitations on what they can write or report about the details from presentations scientists and engineers give.

That business model and model of journalism is under threat now that any person interested in scientific subjects can go to these events with a computer, digital camera, and internet connection to provide up-to-the-minute news to the entire world. The bloggers say that because conventions and conferences are often oversubscribed, people in distant locations want information and news from the scientists and engineers and they are just providing it. The difficulty is with conference organizers who put restrictions on what journalists can say (so that what is reported does not overshadow research papers from journals like Nature or Scientific American) and from researchers who are more reluctant to publish their information in public.

This is just another venue where modern communication tools is upending the traditional social order and structure. My guess is that scientists who have a history of publishing their work and collaboration rather than secrecy will move on to a happy new compromise sooner than many other venues (traditional media, recording industry, etc.).

Government Competence

2009-06-25T21:18:00.002-04:00

Good blog by Shannon Love on the nature of government competence...or lack thereof.

Pension problems, environmental regulation problems, and regulations of subways leading to deaths in DC are all indicators of government incompetence.

There is a great quote that I will probably misremember, but it goes something like this: Never ascribe a conspiracy to the government when incompetence will do. In other words, Occam's razor when analyzing government actions. Is it more likely that the government could coordinate massively complex actions to do something under the radar or is it more likely that government bureaucrats are incompetent and don't coordinate their actions with the rest of the government agencies?

I am not suggesting the traditional alternative to the government, markets and businesses, are always the answer or always clean and ethical. What I am saying is that relying on the government for proper goods and services, when it has clearly demonstrated a pattern of incompetence in a wide variety of services.

Map of Iranian Protests

2009-06-24T21:09:00.003-04:00

This Wired article is about Iranian protesters using Google map technology to map where protests are occurring, where shots have been fired, and where security forces have been seen. Crowd sourcing, the wisdom of crowds, emergent coordination. Call it what you want, but Iranian dissidents are using as many of the modern internet tools available to them to fight guns, helicopters, and water cannons.

It's pretty cool to see where all these protests are taking place. If the traditional media cannot go anywhere to report anything because the regime has restricted their access, then this is the only way for the world to find out what is going on.

2009-06-24T09:58:00.001-04:00

It looks like the augmented reality I blogged about a few days ago (here) is coming to a cell phone near you. A Dutch company called SPRXmobile has developed an augmented reality browser for Android phones, called Layar. It uses GPS coordinates and an internal compass to determine where you are and what you are looking at. It overlays visual information on the display (in camera view) when you pan around your environment. It can identify houses for sale, ATMs, and local clubs and bars. It will debut in the Netherlands soon and will be available in the US later this year.

I think the augmented reality on phones is a hop-skip-and-a-jump away. Many companies and services already exist to provide that type of information on a GPS map, and it doesn’t take that much more imagination to see how cool it would be to apply that same information to a streaming picture in the cell phone’s display.

Nano-geometry and Concrete

2009-06-24T09:37:00.003-04:00

MIT scientists have determined that nano-scale deformations are responsible for large scale warping of concrete over time (article here). By creating denser concrete, this will limit the nano-scale deformations and possibly allow concrete structures to last beyond the current threshold of 100 years to a timeline an order of magnitude larger.

Cool story that shows how nano-scale changes in chemistry and physics can have large scale effects on human creations. By changing the geometry of the particles at the nano-scale humans may be able to extend their physical creations from hundreds of years to tens of thousands of years. Not very appealing if you are an environmentalist, but appealing for those who need to build structures that house all the nuclear waste humans have generated.

Additionally, I wonder if the nano-scale changes in concrete proposed by these scientists will make concrete roads (as opposed to asphalt or gravel or dirt) more plausible in the third world. Lack of transportation networks is what limits much of the development of the third world and the roads they do have make NY city streets look like a beacon on a hill for how to make roads. Any developments in simple transportation technology could be a boon to the development of the third world and open up huge new markets for the west.

Evolution and Cooperation of Iranian Dissidents

2009-06-24T09:30:00.002-04:00

The revolutionary spirit occurring in Iran is the next stage of evolution in the interaction between modern technology (texting, internet, cell phones, youtube, etc.) and informal social organizations. We can trace the anti-government social behavior to the Rose and Velvet revolutions, to the Chinese outrage at corrupt politicians and culpability for death and destruction from the earthquake, to Iraq next door sharing new ideas and ways of organizing. Glenn Reynolds calls it an “Army of Davids.” Howard Rheingold calls it “Smart Mobs.” Scientists would call it complex adaptive systems. Regardless of what we call the essence of what is happening in Iran, it is another mutation in the techno-social ecosystem.

How do I know this is another mutation and something fundamentally different than the previous demonstrations, color revolutions, or non-governmental/non-business cooperation we see all the time? This article in Wired magazine.

Iranian democracy advocates are being aided by two wildly different social organizations and it seems to already be making an impact. The Pirate Bay, operators of the world’s largest copyright infringement organization according to the recording industry RIAA and newest political party in Europe with one member of parliament advocating looser copyright restrictions, has teamed up with Anonymous, a prankster group of hack-tivists dedicated to exposing Scientology’s crimes, to set up a website to “offers tips on how to navigate online in private, upload files through the Iranian firewall, find the best activist Tweeters, and launch attacks on pro-government websites.”

These groups set this website up in less than a week with message boards, information tips, tweeter threads, and how-to’s for lots of anti-government activities. I have studied political science and history for many years now, and this is one of the most amazing things I’ve ever seen evolve in terms of social group coordination and cooperation.

A group of software engineers and businessmen dedicated to file-sharing MP3’s just evolved into a political party in Sweden because of its David-and-Goliath fight against the recording industry. This in and of itself is monumental. Talk about a new way to grow a political party from the grass roots. Then we have Anonymous which is a group of hack-tivists who threw up their arms and said “no mas” when Tom Cruise and Scientology tried to censor the internet and keep information from reaching the people. They helped coordinate and propagate protests against scientology headquarters while conducting low-level hacks against scientology networks to harass, annoy and keep off balance.

Just about the only thing these two organizations have in common is the belief in a free internet without censored information flow. They are not governments. They are not traditional businesses (even though Pirate Bay does make money). They are not non-governmental aid organizations. Their mission statements have nothing to do with the Middle East, Iran, democracy, Islam, or anything else related to the current situation in Iran.

Yet here they are cooperating in less than a week after the Iranian elections providing a coordinated and information rich service to those Iranians caught behind the Ayatollah curtain. If the Iranian dissidents achieve a degree of success, then this new approach to social organization will be copied and spread to others just as any mutation, if successful, spreads throughout the community. If the Iranian government is able to violently crush the dissidents and stamp out any new social organizations, then you will see further mutations and evolution beyond what we are witnessing.

Technology is enabling a panoply of new social relationships and organizations. Just as a species evolves with random mutations and an exploration of the fitness landscape, so too will social organizations evolve and mutate to achieve greater effectiveness. And if the social organizations’ goals are to take down tyrannical regimes, those regimes better watch their back.

Building a Partnership with Ayatollah Ali al-Sistani May Be Paying Off

2009-06-22T11:52:00.002-04:00

And it may be paying off in spades.

According to ThreatsWatch, a report from Saudi Arabia's al-Arabiya says that Rafsanjani, one of the political dissidents allied with Mousavi who lost the s-"election," is seeking to eliminate the Supreme Leader, not just the guy, but the entire position as the sole authority over the country of Iran. That is an unbelievable statement. It is almost so over the top it sounds like a disinformation campaign by the Iranian government. But according to al-Arabiya's sources, it is in fact true.

Religious leaders are thinking about eliminating the Ayatollah position in Iran and form an alternative collective leadership as a replacement organization instead of one man. So where does al-Sistani come in to this story.

Apparently, religious leaders and members of the assembly have conducted secret meetings in the holy city of Qom, and that they have included a representative of Ali al-Sistani, the foremost Shiite leader in Iraq. ThreatsWatch mentions that Sistani made two important statements in 2007 that have a bearing on the current situation: "I am a servant of all Iraqis, there is no difference between a Sunni, a Shiite or a Kurd or a Christian," and that Islam can exist within a democracy without theological conflict.

Now his representative is meeting with religious leaders and members of the assembly in secret meetings that potentially could lead to the elimination of the Ayatollah and his position within Iranian politics. This is a huge development, and could be the compromise solution instead of violent revolution and violent government crackdowns. Although, at this point, anything less than the full surrender of either side will leader to violent confrontation, but this may be an practical solution instead a a functioning western democracy by August 1st.

Remember, it took 15 years from the Boston Tea Party to the emergence of the constitution in 1789. Give the revolutionaries some time. It does not have to happen overnight.

US soldiers and government officials spent countless hours building a relationship with al-Sistani. His wise decision to stay out of Iraqi politics while remain an objective observer in regards to US actions and involvement in Iraq provided him the moral authority and objective point of view to be able to influence the emergence of an alternative power structure. As a professional in the world of "building partnerships" with foreign leaders, countries, and organizations, I would say that this is one huge big payday.

A “Man-Cession” Instead of Recession?

2009-06-22T11:12:00.000-04:00

According to this article, 80 percent of the 5.7 million jobs lost between December 2008 and May 2009 were held by men. The reason is that the manufacturing and construction industries, predominated by men, are the hardest hit with the highest unemployment.

The article goes on to talk about the political aspects of the Obama stimulus plan and how it helped women more than men. It created more office jobs than infrastructure creation. It invested in human infrastructure rather than physical infrastructure. I don’t know about that argument, but it seems like politics as usual for a town dedicated to it. As Mark Twain said, “ Politics: Poly meaning many, and tics meaning blood-sucking things.”

What surprised me about this article was that middle and lower class men were most likely to be unemployed by this economic crisis. It makes sense that the two industries where men are heavily represented (manufacturing and construction) are facing the most dire circumstances because of the economy. Therefore, men would be let go or fired, or have to find a new job after their company collapses without manufacturing and construction jobs.

I wonder if there is some potential in the combination of out-of-work construction workers, social networking technologies and behaviors, and informal groups (as opposed to businesses or governments). Could that combination lead to construction of local projects, conservation of certain environments, or decentralized participation in alternative energy projects? I have no idea, but I wonder if some of these construction workers or manufacturers, who are good with their hands, have practical knowledge in how to build things, and time on their hands may try forming new groups to achieve objectives no one had thought possible. Of course these men are forced to work at whatever they can find because they need to pay the bills, but if enough of them reach a tipping point in organization we may see something we have not seen before.

Massively Multiplayer Grand Theft Auto

2009-06-22T11:04:00.002-04:00

The game designer of Grand Theft Auto has created a new game called APB that will come out next year that takes the coolest parts of GTA and combines it with the growing massively multiplayer online (MMO) capabilities.

The idea is for each person playing in a group of 50 will have a target of another person. Half the players will be cops, while the other half are criminals. The bigger and badder a criminal gets, each mission gets more cops assigned to it so that eventually a criminal-god could have all 49 other players chasing him down.

Beyond that, the rule sets that were created to guide behavior and reduce the chaos and confusion seem pretty smart. For those who love chaos and confusion there will be a game mode where absolutely anything goes. Will the fictional town of San Paro in GTA become like Somalia with quickly evolving bands of brigands and criminals running around amidst general chaos and destruction, or will it emerge as a Los Angeles with distinct gang dominions and clear boundary lines that keep a fragile peace.

I look forward to playing this game and finding out what playing a fun game like GTA will become when 50 random strangers are added to the mix.

$134 Billion in Fake Bonds Puts Everyone on Edge

2009-06-22T10:59:00.004-04:00

Two men with Japanese passports attempted to cross from Italy into Switzerland. The customs officers discovered a false bottom in their suitcase and found $134 billion worth of US bonds in certificate format.

There has not been much media discussion of the event, but it has gotten the notice of the bond markets and currency markets. The most recent news is that the bond notes have been determined to be forgeries (the US doesn’t create bonds in the denominations the men used), but that has not settled the markets. Why?

The fact that two individuals were carrying (fake) US bonds that would have made them the fourth largest creditor to the US in world creates anxiety in the countries that do in fact hold the real US debt. Is it that easy to create forged US bonds that an individual can have $134 billion worth, which if introduced to the market could easily distort global bond markets? The US Secret Service and Treasury department have always been worried about forged US currency, but the percentage of counterfeits to the total (even when including the North Korean Supernote) was always negligible. This case is different. $134 billion in notes is significant and if forgeries and counterfeits are widely distributed part of the system then investors will lose faith in the US bond, the dollar currency, and the financial system itself. That is why everyone from the White House to Treasury to Beijing to Europe is nervous about what is really going on here.

The conspiracy theories are flying around the internet and financial bulletin boards at the speed of light, because this story is so “out there” and the denominations are so ridiculous. Hopefully the Italian authorities will release more information when they conclude their investigation and that the US will shed some light on how these individuals could counterfeit US bonds so easily.

Wind Power Design Gets a Makeover

2009-06-22T10:57:00.001-04:00

The problem with small wind turbines for the roofs of houses and urban landscapes is that they require 7 to 8 mph winds to overcome the friction of the gears, and thus are not economically feasible for small business owners or home owners.

Imad Mahawili, a chemical engineer and wind energy consultant, decided to change the mechanics of the wind turbine design by removing the gears and replacing it with a hub and bearings. He placed magnets near the rim to generate electricity. This new design allows the turbine to operate in winds as low as 1 mph.

Urban landscapes still suffer from unpredictable and varying wind patterns and wind generation may not be the long term economic solution, but new designs never hurt and this design may be incorporated in other wind turbines for the future when they are deployed to New Mexico and Texas.

Chalk up another point for engineers and the market based system in achieving significant gains in alternative energy as compared to the government.

A Few of My Favorite Things: Part VIII (zombies and technology)

2009-06-15T14:50:00.003-04:00

I don't know if this is actually Part VIII, but I know I use "favorite things" generously in my blogpost titles when I see something cool enough to blog about. I am not trying to steal Julie Andrews' list, but create my own.

In this case researchers at my alma mater, Georgia Tech, have combined two of my passionate interests into one: high-tech and killing zombies. I know what you're thinking; you probably didn't know that I was passionate about killing zombies, or even that it was a passion anyone could have. Yet, in this day and age where everyone can join a group for anything (like Northeast Georgia's Dungeons & Dragons Fruit Eating Seminar) I like to kill video game zombies.

So what did Georgia Tech researchers do? They modified a device that looks like an iPhone so that it could generate augmented reality graphics. Then they layed a flat gameboard that looks like a city on the table. The video game player then uses the device to look at the game board. The augmented reality program makes city buildings appear as if they actually existed on the game board, when in fact, they do not. The board is flat. But looking at the iPhone-like device, you can see a bunch of 3D buildings. Very high tech, with loads of potential.

Next, the researchers added the zombie element. Now that they had 3D buildings they needed to use the "city" as the background for a video game. So they injected a bunch of zombies running around trying to kill civilians. As the game player, your objective was to see the zombies through the iPhone-like device like a regular video game and kill the zombies using a reticle on the screen and pushing a button on the device.

So what? Well, the video game was taking place inside a handheld device, using the background and schematic structure from the real world as the constraints on the players in the game. That is pretty freaking cool. Obviously it is very simple, but think about what happened to the video game industry when Atari first debuted its capabilities.

With augmented reality platforms becoming part of the cutting edge defense related technologies for our soldiers, the impetus to improve the technology will only grow in the private sector. The increase in computing power, shrinking component size, reduced power consumption, and hopefully increased battery life will decrease the costs for implementing effective portable augmented reality capabilities to be used by everyday people.

The question is whether the video game industry is one of the driving factors or whether it follows the defense and computing industries.

Iranian Courage And Conviction

2009-06-15T14:44:00.003-04:00

This picture is definitely worthy of one thousand words. Suffice to say, I am glad to see the Iranian youths rising up against a totalitarian regime using the same tools people in the West take for granted as a birthright.

I hope this picture becomes the quintessential moment that the Iranian theocracy began to crumble into oblivion. I'll raise a glass to that, even if no one in the US government will.

Alternative Energy's Future Requires a "Green" Investment

2009-06-11T20:32:00.002-04:00

Newsweek author, Daniel Gross, writes about the economic impact of the recession on alternative energy investment and development. He makes the case that alternative deals in financing are the only thing keeping the industry strong and growing.

Tax credits, rebates, leasing agreements, 20 year loans, are all having an impact on the solar power industry in California. He says that technological innovation is no longer driving the industry's growth, rather it is the tax benefits and financing deals offered by outside investors or solar companies themselves.

He quotes solar power company employee saying, "If they come out with a solar panel that's 2 percent more efficient than the existing one, it won't move the needle," says Rive of Solar City. "You have to make it easier for people to adopt the technology." That makes sense on some level, and who am I to argue with a businessman actually making a product?

While it is true that a 2 percent increase in efficiency probably will not move the needle much, that is to be expected. The increased savings from 2 percent more efficiency is not that much more, therefore the supply and demand curve does not change drastically. What I do think he is missing because he is busy everyday making a product for his customers is the research piling up on successful increases to solar panels, and more importantly, making them easier to manufacture and deploy.

We will soon reach a tipping point when the solar power research I read about in scientific magazines becomes operational and commercially viable. And that tipping point is only for solar power. Good minds and good money is going into alternative because it is the only way communities and business are going to grow without damaging the environment (which is becoming increasingly politically intolerable) and without relying on politically unstable fuel sources (re: Middle East, Africa, Venezuela).

Interesting Education Graphic

2009-06-11T20:24:00.003-04:00

It is shocking how expensive undergraduate degrees have become. This graphic has a lot of information contained within it. The most interesting thing is how equally expensive our elite education is, especially now that undergraduate degrees mean so little in the workplace.

Sure, some hiring people may look at a Harvard degree as opposed to a community college or state college degree and choose the Harvard graduate. But the wisest and shrewdest businessmen would look at the person and the skills rather than where the person went to school.

With all the chaos surrounding our economy and our federal budget, with the loss of several trillion dollars in national wealth over the past six to eight months, with the declining relative value of an undergraduate education, and with the increasing opportunities for higher education beyond the Ivy League, I believe higher education is going to reach a tipping point soon where drastic changes will occur and the entire landscape will change.

Inmates Using Technology to Ply Their Trade

2009-06-09T22:53:00.004-04:00

This Wired.com article about inmates in America's prisons using cell phones and technology to plan, coordinate, and order attacks and murder is fascinating.

It seems that the same technology we use in the free world is being used illegally (inmates are not allowed to have cell phones or other communication devices) by those on the inside in the same manner we use them, with the difference being instead of updating our Facebook page or finding the closest pizzeria, they are using it too coordinate murder and mayhem.

The essence of prison is supposed to be isolation, punishment for a crime committed, removal of a cancer on society, and the like (despite the fact that many states provide televisions and Playstations to their inmates after civil rights lawyers said it was cruel and unusual to deny them these rights). That is why unfettered communication to the outside world is not allowed. It is why prison guards and other inmates have always been involved in passing secret notes and providing inmates with communications for a price. Now the level of communication and connectivity has increased exponentially just like the rest of the world.

This development is not surprising. We see this type of communication and social networking in terrorist cells, the narcotics traffickers, gangs, and anti-globalization hoodlums. Of course we would see it in prisoners too. I suppose the only surprising thing about it is how easy it has been for the prisoners to get access to such electronic devices and how devastating a few phone calls and text messages can be.

Maybe I am missing something but this problem has one of the easiest solutions I can possibly imagine. Just install cell phone blockers at prisons. They have deployed hundreds of these devices at sensitive intelligence and military installations. Why should incarcerated inmates have access to a working cell phone when I don't? I give up the right to make personal cell phone calls at my workspace because of my chosen employer. Those who have committed crimes such as murder, rape, and assault should not be given greater freedoms.

Another more expensive option would be to put cell phone towers at some of the prisons and then disallow any cell phone not on an approved access list (like for guards, lawyers, or other people). Additionally, you could also let certain phone calls go through in certain circumstances in order to tap/trace inmate communications. Obviously they aren't talking to their lawyers if they are using hidden cell phones, for those squeamish about civil liberties violations.

The dangerous thing about this technology in the hands of inmates is that it has the same potential emergent properties as technology in the hands of law-abiding citizens. We have seen flash mobs and coordinated civilian maneuvers at anti-globalization protests with this technology. It does not take a genius to expect the same kind of coordinated behavior by inmates against each other or God forbid against the guards and other security forces.

Save or Create Jobs

2009-06-08T15:02:00.004-04:00

Horray! We all get more stimulus money, courtesy of President Obama. He is going to INCREASE stimulus spending beyond current levels. That sounds like kids who, when asked what the largest number is, say, "infinity plus 1." We are already at infinity and now President Obama is adding 1.

I do not understand how it is possible for the US government to increase stimulus spending beyond what it is already doing.

Moroever, the stimulus spending will be used to.....wait for it......"save or create" 600,000 new jobs. It is astonishing that the media have refused to confront adminstration officials over this imaginary metric that no statistician, economist, or labor expert would validate. This damn term "save or create" has got to go. Every time a person in government uses it, I feel bad for them because they obviously 1) do not know what the word create means, 2) have no idea how statistics are gathered, and 3) created a measure on par with quantum fuzziness over spin properties being simultaneously "up" & "down."

Why not just say, "the measures we are enacting will save or create 50 million jobs and $8 trillion"? How would anyone be able to demonstrate that you are wrong? Even if you did nothing, you could claim that you "saved" 50 million jobs by doing nothing. These politicians with their "newspeak" actually created a metric approved by the government that is not measurable or even falsifiable.

The economic collapse has provided us with two ubiquitous terms that now need to be caste to the dustbin of history: "save or create" and "too big to fail."

Viral Missing Link

2009-06-08T14:10:00.001-04:00

A virus has been discovered that is so large researchers originally thought it was a microbe. Even though it is classified as a virus it has genes from bacteria and other characteristics of bacteria as opposed to typical viruses.

“Some researchers called it a “missing link” that blurred the boundaries between viruses and living cells, between living and dead.”

I find this story fascinating on a number of levels.

What does it mean to be living versus dead? What are living cells and what are not? As I understand a virus is not actually alive, but because this new “mimivirus” is not actually a total virus is it not alive either? This one discovery adds another level of depth to the murkiness that already surrounds the definition of life.

Look at the picture of the virus (by clicking on the link). The symmetry is wonderful. The researchers took thousands of pictures to create a 3D model of the mimivirus. Five-sided rotational symmetry is like a prime number in the study of symmetry. This is not amazing or shocking given how many facets of nature display the wondrous variety of symmetry. It is important to see how symmetry pervades so many facets of nature from the DNA double-helix to this “missing link” between viruses and bacteria all the way through bilateral symmetry of human beings.

In every book I have read on symmetry, the author never fails to mention that symmetry is the way natures displays perfection, attractiveness, beauty, ideal function, and other attributes describing “the good.” Human beings with greater symmetry are always classified more beautiful than others according to numerous studies. Bees always seek out more symmetrical patterns of flowers to gather nectar. The list goes on, but symmetry describes beauty sought after in nature yet remains functional rather than just ornamental.

So why is the mimivirus symmetrical around five rotational angles as depicted in the linked photographs? Does symmetry help the mimivirus excel at a specific function? Why not three-sided or seven-sided rotational symmetry? Is this level of symmetry, and by derivation a degree a complexity, for attracting other viruses or bacteria in some way? Considering that the mimivirus straddles the definition of virus and bacteria, what levels of symmetry and complexity does this mimivirus have compared to bacteria and viruses?

Maybe these questions have no meaning because the symmetry I see in the photograph is artificial or only exists within the photo. Perhaps these questions do not make sense from a biological perspective and include too much poetry or teleology?

Whatever the answers are to my questions, the researchers that found this missing link and were able to capture fantastic pictures deserve great credit.

Question Your Assumptions

2009-06-08T11:56:00.001-04:00

Jacob Weisberg wrote a short piece that questions some of the most widely held assumptions in foreign policy, government, and economics.

His main point is that common sense prevailed for too long and no one questioned the financial structure underpinning the longest economic growth in history until it was too late and the steam had been let out of the engine. Therefore, might it not be prudent to question some of our other widely held assumptions in order to not be totally caught off guard again?

Question your assumptions and make sure not to accept a course of action simply because some expert or politician says it’s the best. I do not necessarily agree with all of the statements above, but it would be dishonest for me to question some of my political assumptions but not all.

Here are a few of the possibilities that we need to consider in light of the economic catastrophe over the past several months that 99% of economists had no clue was coming:
--Nuclear proliferation may be good
--Climate Change will not be catastrophic
--China is actually unstable
--Homeownership for everyone is actually a bad thing
--Bonds may outperform stocks over the long run
--Detroit can compete with the world’s car companies
--We are not running out of fossil fuels and never will

Nuclear proliferation: Thomas Barnett often talks about how nuclear weapons have made great power wars extinct because of the threat of nuclear weapons. Sure, great powers still wage proxy wars but none actually fight directly where the threat of nuclear weapons is in play. So maybe it is better for Iran to get nuclear weapons (or at least accept that its going to happen and there is absolutely nothing we can do about it now) because it will reduce their fear of invasion and regime decapitation.

Climate Change: Bjorn Lomborg wrote a book I read recently called “Cool it: The Skeptical Environmentalist’s Guide to Global Warming” that argues, among many other topics, that global climate change will not be catastrophic. The public accepts the argument that climate change will be catastrophic because complicated computer models tell scientists it will be so, just like the complicated computer models that contributed to and precipitated the financial collapse on Wall Street.

China: There is a great book called “The J-Curve” that posits a skewed U-shape curve that defines the stability of a state versus its freedom and liberalization. Authoritarian countries that are stable (read: Cuba) become less stable as they move along the path towards freedom and liberalism for its people. Moving along this path may take many forms from opening up to foreign investment, economic reforms, political reforms, or just increasing per capita income. That is what is happening in China and it may be the case that they are becoming less stable (even more so with 20 million more unemployed since December 2008).

Homeownership: Questioning this assumption is easy. Why should every person or family have a house? That is a lot of debt for 30 years to follow you around wherever you go in an economy that increasingly prizes labor mobility. Additionally, banks preyed on minorities in urban environments with sub-prime loans. The people with sub-prime loans clearly should not have been given the money in order to achieve some social goal of 70% of the population with owning a home.

Bonds: I don’t know much about this one, but it strikes me as possible because of long time horizons. Much of financial data is eventually ironed flat or evened out over significant time horizons of 25 to 50 to 100 years.

Detroit: This scenario is not hard to imagine either. Most experts agree that the burdens weighing down GM and Chrysler are its debt obligations to its pensioners and its unions. Filing bankruptcy to restructure those debts would have freed up the companies to be better at making cars and more profitable to boot. Oh, well, now the government owns them and will not be making a profit any time soon.

Fossil Fuels: The study mentioned in Slate proposes that the creation of fossil fuels is from geological processes deep in the earth that rise to the surface, and not degraded plant and animal matter into carbon compounds. The scientific study sounds interesting but would need to be confirmed multiple times in multiple ways for it to break the hold this assumption has on the public.

Chinese Dissident Software Used By Iranian Youngsters

2009-06-07T21:29:00.003-04:00

Most people who surf the internet know about the Great Firewall of China, the electronic firewall that prevents Chinese citizens from accessing certain parts of the internet due to the political requirements of the Chinese government. What these same people may not know is that many countries have similar software capabilities to restrict their citizens' access to websites the government deems "harmful." These countries include Iran, Syria, Saudi Arabia, and Cuba.

Software experts volunteering their time with the Falun Gong, a banned group in China, helped create "dissident software." This software allows users behind a country's firewall to access restricted websites. It opens the door to the entire internet instead of only the one the government wants you to see.

According to this article in the NY Times Iranian college students got a hold of the dissident software in order to surf the web as they please. Just like college students everywhere, they emailed it to each other and file-shared the software so that 400,000 people were using it in only a few months.

I am behind all these efforts to open up the internet to absolutely anyone who wants to connect. I think Google, Yahoo, and Microsoft colluding with these authoritarian governments is awful. (I understand the business perspective, and I understand that it at least gets a foot in the door so that they can eventually open up more later, but it still gets my knickers that American companies are supplying these capabilities.)

From an information operations perspective, there is absolutely nothing the US government or Department of Defense can do to influence foreign audiences like the free flow of information can. If we really believe our values then we should not need to surreptitiously influence foreign audiences. We should just promote the free flow of information like we have promoted the free flow of goods and services through free trade; call it "free information" as opposed to "fair information" (analogous to free trade vs. fair trade). The US government ought to be giving a lot more money to efforts that help circumvent these draconian restrictions by authoritarian governments.

The organizations involved in the circumvention of government firewalls are the Global Internet Freedom Consortium, Tor project by anti-censorship activists (created by US Naval Research laboratory), and Psiphon created by University of Toronto political scientists.

Victor Davis Hanson on the Obama Cairo Speech

2009-06-07T20:57:00.003-04:00

This is an interesting op/ed piece by Victor Davis Hanson about the nature of President Obama's speech to Muslims and the Middle East in Cairo earlier this week.

You should read the whole thing, but there are two points that he raises that I would like to highlight.

First, he writes about Obama's background as a law professor and academic. Because of this background it obviously shapes how he looks at the world and responds to international incidents. This background in academia creates a universe where everything can be negotiated and debated. Hanson writes about his own confrontation with that falsity of that truth when he returned from academia to work as a farmer on his family's land in California.

In the past few months I have often listened to President Obama and read his words in news clippings and it is apparent that he is acting in accordance with how I would expect any one of my college or graduate school professors to act. While that is not necessarily a bad thing, I have found it easier to understand his positions on a lot of issues through imagining what one of my professors would have done if confronted with the same thing. This stereotype is obviously different from a president with a background in business, the military, as a governor, or even Congress.

Second, Hanson raises an interesting point that Obama's apologies for past US wrongs and platitudes of Islam and Middle Eastern countries runs up against human nature. He says we, "don’t continually praise your friends, competitors, and enemies." While I do believe that there is a certain amount of "praising" to be done in diplomatic negotiations with other countries, both allies and adversaries, there is something to be said for "continually" doing it. It is not that it exudes a sense of weakness like many of Obama's critics advocate, but rather that it points to a misunderstanding of human nature after years spent in academia.

Universities are places that (are supposed to in theory at least) respect reason, debate, and the pursuit of truth. I admire those qualities and am glad there are institutions in this country that allow that type of pursuit. However, I do not believe the "real" world operates like that. The world outside the comforting ivy walls of academia is one of competition; not necessarily always with force, but competitive nonetheless. I have written of the benefits of both competition and cooperation, and my beliefs on the subject have been shaped by Robert Wright's "Non-zero" about the nature of positive-sum interaction, instead of zero-sum interaction, being the driving factor behind civilization's advances over the past several thousand years. There is no doubt in my mind that cooperation in a non-zero sum environment is the best possible outcome because it allows everyone to take one step up. But that does not mean that every environment and situation is non-zero sum, particularly in international relations. Additionally, it does not mean that our allies, adversaries, and competitors have the same viewpoints on possible cooperation as we do. They may view a situation or environment as zero-sum, whereas we view it as non-zero sum (or positive-sum).

Hanson has written extensively on the subject of human nature in conflict and in battle in many of his books. I hope he continues to analyze President Obama's decision making with an eye on human nature as presented through thousands of years of history and how Obama confronts these decisions.

New Company Creates Flexible Solar Panels

2009-06-07T20:54:00.002-04:00

A cool new technology firm created thin film flexible solar panels. These lightweight roll-to-roll panels can molded to existing roofs and building facades. They are more attractive to potential customers because they are cheaper and can be applied to irregular surfaces.

Pretty cool stuff. One can only hope the government will just stay out of their way.

Postive Black Swan for Media Storage

2009-06-06T18:55:00.003-04:00

I've mentioned Nicholas Nassim Taleb's Black Swan many times on this blog. But for those who forgot, it is an extreme event that is hard to predict and rare. Typically they are negative Black Swans like tornadoes, earthquakes, forest fires, economic collapses and the like. But occasionally a positive Black Swan does emerge.

This story highlights just such a positive Black Swan in the realm of data storage on hard disks. The current capabilities for storying data (mp3, video, spreadsheets, 1s and 0s, etc.) is based on a discovery 20 years ago of the "giant magnetoresistance effect" (GMR). Scientists are "on the trail" of the "colossal magnetoresistance effect" that is one thousands times more powerful than the current GMR. This could lead to another revolution in computing technology.

I will admit I don't understand much of the detailed science written in the article, but the positive Black Swan is out there waiting to be discovered. So when you see a chart predicting the constant growth of some capability (computing, media, iphone apps, whatever), understand that there are positive Black Swans out there that could totally upend the system and explode an industry into pieces and create from those pieces something totally extraordinary.

Another Reason the Government Keeps People Down

2009-06-06T18:39:00.002-04:00

This story is appalling and tragic for how government treats its people most in need.

In San Francisco a homeless alcoholic finally decided to do something about his life; he started shining shoes. He had collected about $573 and became something of a sensation on a busy mainstreet because of his work ethic and turn around story. He was working towards $600 so he could finally put a down payment and first months rent on a place to live off the street. A local reporter wrote about Larry Moore when a San Francisco city bureaucrat saw the story and then demanded $491 for a sidewalk vendor permit. Not only did the bureaucrat demand this money from the homeless man but then would not direct Moore on who to pay it to or what forms he had to fill out.

The first thought in my head is "isn't San Francisco the friendliest place on earth for homeless people?" Don't they go to extraordinary measures to provide aid to the thousands of homeless on their streets? Why would a government want to punish one of its citizens who was homeless and was able to pull himself out of an awful situation by the straps of his own boots with no help or intervention from the state?

That is the key question. See, the government does not want its homeless to be independent, but rather dependent on its beneficence. Of course, one could argue this was just an incident of a stupid bureaucrat in a city government not thinking and not caring. But that argument would miss two key points. First, even if a person is compassionate and thoughtful, a government is not and that bureaucrat's thought process was perfectly in line with the goals and objectives of the city government. Second, a government's purpose has evolved so that it wants its people dependent on it.

The funny thing is that this type of government response to a homeless pulling himself out of the gutter would never happen in a small town. It only happens in places where the government bureaucracy is unwieldy and wants more control.

Luckily for Moore, a few of his patrons found out about his government-induced predicament and helped him out with their own money so he could pay first month's rent.

I'm Back

2009-06-04T23:07:00.003-04:00

After a hiatus that lasted a few months I'm back on the job of blogging. I'm back to being a blog-master, master of blogs.

The summer months will be slow at work because the building is waiting for the FY2010 budget to be submitted to Congress and for the Quadrennial Defense Review to be completed. Currently we are just making sure our the tasks we laid out a month ago are being followed and work is being done.

I will continue to blog about interesting items in the news, alternative energy technologies, international relations, the nature of complex adaptive systems, and many other topics that might pique my fancy.

I apologize to any readers who had grown accustomed to reading my blogs over the few shorts months since I began this adventure. I hope I can earn back your trust and your loyal following.

Please leave me a comment if you feel inspired to do so. I have responded to every comment offered on my blogsite.

Take care.

Musings on the Global Recession

2009-06-04T15:56:00.002-04:00

There have been so many analytic reports on the financial and economic crisis of 2008 that you will forgive me if I do not entirely buy any of the arguments from noted economists, financial experts, and international relations strategists. There is a cacophony of arguments about what caused the sub-prime crisis, followed by the stock market crash, followed by a general economic decline on a global scale. Each theory or argument looks at one fundamental element leading up to the sub-prime mess or the Bear Stearns collapse or the late October ’08 stock market crash. The author’s implication is that had this one element been different, or monitored, or incentivized different behavior then the rest of the story would be different. Had the government not intervened in Bear Stearns, the whole story would be different. Had the government not distorted the market by letting Lehman Brothers fail the whole story would be different. Had the financial models used to evaluate assets not been structurally oblivious to declines in the housing market the whole story would be different. You get the idea.
Let me outline just a few of the arguments I have read over the past several months seeking to explain how we got to where we are and what or who is to blame. May I remind the reader there is still no consensus even though there has been some agreement within various political circles in Washington.

1. Failure of capitalism: The essence of capitalism is inherently week and structurally unsound generating increasing credit for those who can never pay it back. It encourages imbalances between global economies. Capitalism incentivizes the greedy and the corrupt over the responsible and the moral leading to collapse.

2. Americans have too much debt: The US has too much debt on its personal credit cards, its houses, its government spending, and its trade deficits. This deficit and skewed economic relationship with the rest of the world distorted the true economic value of goods and services. Taking on this much public debt, treating your home as an ATM to finance the “good life,” and borrowing at an unsustainable rate eventually brought the system to its knees.

3. The Chinese have too much savings: This is the reciprocal of the US having too much debt. Ordinary Chinese citizens and businesses, in addition to the central bank, saved too much money, using it to buy safe and secure US treasuries. Buying US treasuries kept US interest rates low and did not force the Chinese currency, the yuan, to rise as a natural consequence of exporting so many goods, which would have hurt their export-led growth.

4. Lack of innovation: The promise of innovation during the late 1990’s which would lead America into the 21st century did not pan out like everyone thought it would. Biotech, alternative energy, health research, and nanotechnology as industries have each taken much longer than investors thought they would with their capital investment. Only now do cross-industry enablers exist and with significant hurdles overcome, these industries look brighter. However, that means that all the capital expenditure over the past decade in search of innovation has not had its return on investment, hence an economic decline.

5. Not enough regulation: The broader economic failure can be traced to the specific financial failure in the fall of 2008, and that failure can be traced to a decade of reduced financial regulations (Glass-Steagall Act) and relaxed oversight by the SEC, Congress, and the Bush administration of the financial industry. With the revolving door between Wall Street and the Washington corridors of power, the power-brokers altered the system designed to keep a check on Wall Street in favor of one that allowed as many degrees of freedom as possible. This lack of regulation and oversight led to the creation of financial weapons of mass destruction in mortgage backed securities, credit-default swaps, and myriad of ponzi schemes of which Bernie Madoff was the poster boy.

6. Government intervention with Fannie Mae/Freddie Mac: The Community Reinvestment Act is responsible for the financial collapse because it encouraged the two quasi-government agencies to lend money to poor people to buy houses they probably had no business buying. This distorted the market with political influence and meddling, not to mention the implicit guarantee of the US government backing both Fannie Mae and Freddie Mac that the market would eventually test.

7. Too much money into housing after dot-com bust: The dot-com bust burned a lot of investors and shaped how they would invest in the next several years until 2008; by making real estate the only asset that would never depreciate. This assumption that land and a house never went down as demonstrated by reams of economic data showing the relatively uninterrupted growth of the real estate market over the past 60-80 years. This irrational belief led to young people getting half-a-million dollar homes on a salary right out of college, middle-age couples refinancing their houses to use the money for vacations or sports cars, and new immigrants owning 5 houses in NY City all by using the equity of one as the basis of a loan for the next. The overvalued housing market was due for a correction and it just happens that Wall Street based many of their assets on the assumption that it would not correct itself.

8. Assumptions of economic behavior: The prime reason is said to be the assumption that housing prices would never decline. Maybe flatten out, but never actually go down. Other assumptions mentioned in the press are that the US could continue to operate with trade deficits and continued borrowing, the bonus structure on Wall Street incentivized profit-seeking behavior instead of excessive risk-taking, and the government would stay out of heavily influencing the market and multinational corporations. Each of these assumptions was shown to be false and said to contribute to the financial collapse and economic decline because of structural relationships based on the assumptions.

9. Financial wizardry of “tranches:” The financial wizards of Wall Street took risky assets of sub-prime mortgages and bundled them together with less risky assets and then divided up the bundle into “tranches” that would pay lower rates of return for lower risk. Then they bundled together the least risky tranches to make new mortgage back securities and created different level tranches and sold those based on risk. The multiple levels of derivatives made the evaluation of risk almost impossible and when the assumptions underlying the asset class of mortgage backed securities was shown to be weak or false, the house of cards built by this multiple level derivative structure came a tumbling down.

10. Alan Greenspan wasn’t a genius: The argument is that in an effort to avoid all recessions and any downward movement in the market, Greenspan kept interest rates too low for too long. That created easy credit and allowed businesses and individuals to rack up huge amounts of debt that eventually buried the economy. Had the interest rates not been too low for so long, real estate investment would not have exploded like it did and when a correction did come there would be less effect on those who had investments in real estate. Greenspan did indeed keep the economy going ever more upwards, avoiding many recessions or potential declines, at the cost of structurally weakening the entire economy so that it became too weak to respond to the difficulties with the sub-prime crisis.

11. Ridiculous oil prices: The argument is that the substantial rise in oil prices weakened the global economic system that was not ready for such high prices. It does not matter if the rise was the cause of a few speculators, a decline in supply, a rise in demand, or geopolitical maneuvering. The high oil prices caused the prices of many other goods and services to shoot up as well, driving the costs ultimately to the consumer. Already weighed under mounting debt, the US consumer could no longer drive the global demand for goods and services with higher oil prices added to the mix. Sub-prime defaults were actually caused by increased in goods and services for middle class and lower income families on whom the increases in oil prices ultimately fell in 2007-8.

12. Ratings agency behavior: Moody’s and S&P, two of the biggest and most influential ratings agencies, approved the first tranche of mortgage backed securities based on risky assets as a AAA, the highest possible. The second tranche would be AA and so on until the last tranche. Here is where the ratings agencies papered over the entire financial debacle. When financial institutions took ten single B level tranches and combined them together to create a new financial instrument and sliced it up into tranches, the ratings agencies would rate the first tranche as AAA even though it was fundamentally based on the riskiest assets in the entire mortgage backed security. The agencies did this because of mutual back scratching with financial companies and the system was not incentivized for them to tell the truth nor investigate an asset fully.

13. Uber-interconnected global economy: The global economy has never been this interconnected and mutually dependent. The trillions of dollars flying around the world as ones and zeroes looking for the slightest return on investment stagger the mind. The reason the financial collapse turned into an economic collapse on a global scale is because of the interconnectivity of markets. Look at how interdependent the economies of the world’s leading capitalistic country (USA) is with the world’s leading communist country (China) are. The Wall Street Journal had a map that displayed the hardest hit countries in terms of GDP loss and unemployment. As Thomas Barnett noted, the countries most affected by the economic decline are in the Core and New Core. The resonating reverberations from the 2008 financial shock sped around the global economy at the speed of light creating cracks in the local economies of any country connected to the central system. The countries in the Non-Integrating Gap not connected to the global economy felt very few reverberations from the financial shock in 2008.

I am reminded of the description of a chaotic system. There exist chaotic systems all around us, from vortexes of the end of airplane wings, turbulent flow of water down a river, the weather system, and even the rotation of the planets around the sun. Any system that is extremely sensitive to initial conditions can be a chaotic system. One of the simplest chaotic systems to model and study is a pile of sand. Yes, that's right; a pile of sand. A pile of sand with a mechanism that drops additional grains of sand from above onto the pile making a cone-like figure.

The sand pile has been studied intently by scientists and mathematicians to understand the nature of a chaotic system. See, the pile grows with each additional grain of sand. However, sometimes the addition of one grain will cause an avalanche down the side of the sand pile. By studying the size of the avalanches (the number of grains in involved in the avalanche) scientists hoped to figure out the nature of the forces acting on the system. What they found is that the size of the avalanche could not be determined. In other words, there was no way for a scientist to determine beforehand based on the characteristics of the sand pile with the addition of one more grain of sand whether there would be an avalanche or how big it would be.

The key is that the scientists could see what happened in the avalanche after the fact. They could trace the transfer of forces between one grain of sand and another, looking for cascading effects, to demonstrate how that particular avalanche happened. But they could not determine how or what would happen beforehand. That is why scientists call chaotic systems deterministic because the system evolves based on its initial conditions, yet its behavior may appear random.

I'm sure you are wondering how this discussion of chaotic systems relates to my overview of all the reasons economists have conjured for the financial collapse and subsequent global economic decline. Well, dear reader; don't the economists' descriptions of what happened and why appear analogous to a scientist trying to explain why a particular avalanche occurred and how each grain of sand interacted with another to cause that singular event. People did not see this event (avalanche) coming. (Of course there are a few like Taleb, Roubini, and small select few who predicted this event, but many experts did not.) The descriptions we read about what happened and why are the particular grains of sand interacting with other grains of sand resulting in an avalanche. Anyone can trace backwards what happened and see how each grain of sand was acted on by the force of another with cascades throughout the system growing exponentially.

But again, scientists cannot predict a single avalanche with a pile of sand knowing all the forces and the states of all the grains of sand. The system is chaotic. Only in hindsight can one begin to see how everything turned out. Keep this in mind as "experts" from around the world make suggestions about what the US or the government or the global economy needs to do in order to avoid a similar recession in the future. They do not know the initial conditions of the system. They do not know all the forces acting in the system. They do not know how many "grains of sand" are being added to the system with each financial transaction. How can they possibly hope to contain a complex and chaotic system like the global economy based on analyzing one "avalanche" after the fact and instituting measures based on that singular event. The experts need to recognize their own ignorance and approach their study with a little more humility to realize their suggested changes will only stop an "avalanche" like the one we just went through and may not work on the "avalanches" to come.

Pirates Are An Old Problem

2009-04-10T21:01:00.002-04:00

Piracy was wiped out in the early 1800's by the Royal Navy and is one of the great enduring gifts Britain has given the modern world. Now, with the world watching, the US Navy is attempting to negotiate the safe release of the captain of the US ship Maersk Alabama who is being held hostage.

As Shannon Love makes clear, the scourge of piracy is once again upon us not because of new technology or new tactics, but because the international community lacks the political will and the legal means to deal with it.

"I think that, as with terrorism, the return of piracy indicates the collapse of international law and the liberal order it establishes. It tells us how dysfunctional international law has become...

Forty years ago it would seem pathetically funny that a group of people in a fishing boat armed with nothing more than assault rifles and RPGs could capture ships out from under the nose of the U.S. Navy, but today we regard it as a “very serious and complicated problem.” It isn’t. Modern piracy is a trivial problem with simple, proven and well understood solutions. The fact that we cannot deal with it tells us how sick we’ve become."

I totally agree with this assessment. Even the military folks I work with make the case that if you use force to stop the pirates it does not stop them from regrouping onshore, and that absent a political-economic solution for their failed state (re: Somalia), it would be unwise to to use force on the high seas.

I think that is the wrong way to look at the situation. It is taking the lessons the military has learned from Iraq and Afghanistan in counterinsurgency and incorrectly applying them to the problem of piracy.

International law backed up the navies of the 19th century in their pursuit of pirates. They navies were allowed to destroy the pirate ships, the bases from which the pirates operated, and the pirates themselves with the support from all nations because global commerce was paramount for all nations. International law and the law on the high seas is so convoluted, and the media effect so pervasive, that the tactics once reserved by the navies for dealing with pirates has essentially been taken off the table.

The elites around the world now look at pirates the same way as they do terrorists; as people driven to act this way because of desperate economic conditions using justified tactics because of these conditions. Only when the international community, and specifically the elites of liberal democracies, come around to the realization that piracy is the enemy of global trade and order will it be dealt with appropriately like the Royal Navy did over 150 years ago.

US Government Corruption Pays Off

2009-04-10T13:21:00.003-04:00

University of Kansas researchers have found that US companies spent $283 million on lobbying efforts for the American Jobs Creation Act in 2004. When this bill was passed, these specific companies received $62 billion in tax savings because overseas earnings tax rate was decreased from 35% to 5.25% for one year. (story)

US companies got a 22 thousand percent return on investment based on their lobbying efforts due to the corruption of the US government, and particularly the US congress.

Any congresscritter or government official who bemoans the corruption in Iraq or Afghanistan ought to look in their own house first....$62 billion. That is surely more than the amounts passing through the pockets of politicians and businessmen in the Middle East and Central Asia.

It is all about incentivizing behavior. Communism does not incentivize productive and innovative behavior, while capitalism does. Crime drops precipitously because of more policemen patrolling the street. Allowing corrupt businessmen to receive a payoff after providing "bribes" to congresscritters only creates an incentivized system where it encourages similar behavior.

Look at the piracy off the coast of Somalia. The insurance companies keep on paying the ransoms to the pirates, thus creating an incentive for pirates to continue their behavior. Of course, the pirates will stop when the incentive system has changed and that does not look to be happening anytime soon. I could say the same thing about the members of congress.

Homegrown Terrorist Convicted

2009-04-07T21:04:00.004-04:00

A sailor in the US Navy was convicted on terrorism-related charges for emailing a noted Al Qaida webmaster in England specific methods that terrorists could use to attack navy ships. Paul Hall, aka Hasan Abu-Jihaad (I know, I'm not making that up) lived in Phoenix and was sentenced to 10 years.

The scary thing about this is the fact that terrorists are growing in our midst. The not too bad thing is that for the most part our melting pot culture and tolerance of other cultures allows Muslims in this country more freedom than anywhere else. Luckily we do not have the assimilation problems of the UK or Europe. The bad news is that because we have not done enough to destroy this dangerous ideology, it can infect our population like a virus.

Allowing Businesses to Fail

2009-04-07T20:58:00.002-04:00

This blog post is a great explanation for why government should not be in the business of directing which companies are allowed to survive and which ones are allowed to fail. Profits and losses are subtle feedback mechanisms to the business which helps direct resources for the consumer. By short-circuiting that process and not allowing a failing company (read: a company not responding to feedback mechanisms), allocation of resources becomes skewed.

Very short and very clear explanation.

Secretary Gates Proposes Strategic Shift in New Budget Proposal

2009-04-07T08:29:00.003-04:00

Defense Secretary Robert Gates yesterday released the most dramatic shift in defense spending and priorities since the end of the Cold War. Sure, you could argue that spending on Iraq and Afghanistan dwarf any changes he proposed yesterday, but Gates is truly pursuing a strategic realignment with budget priorities to a different world than existed during the Cold War.

Some highlights:
- Ordering only 187 F-22’s total (4 more than originally planned)
- Cutting out all the Future Combat Systems (FCS) vehicles, and spinning off sensors and network accomplishments
- Reducing the unnecessary and “exotic” missile defense experiments while maintaining a robust theater anti-missile capability
- Shifting the navy towards more smaller ships rather than fewer larger ones
- Adding more special forces people and support platforms, and more cybersecurity folks
- Increasing the number of soldiers and marines while holding constant or reducing the air force and navy personnel
- Cancelling multiple boondoggle programs like the CSAR-X, TSAT, Presidential helicopter, Airborne Laser
- Hiring more civil servants to oversee the pentagon budget and reduce the number of contractors (uh-oh, I hope I still have a job after this budget cycle)
- Keeping the refueling tanker as a single bid proposal effort rather than splitting it between Boeing and Northrop Grumman

The strategic framework Gates is proposing, to prepare for and build a force for today’s fights and irregular threats rather than some imagined distant threat from China or Russia, will impact the defense community and national security more than any other decision he has made or will make.

As a defense analyst for several years, this budget proposal is some of the best news I have heard to radically reshape the Defense Department to address the actual threats that exist rather than the ghosts of the past. I could not be happier to be associated with a department that adopts these funding priorities.

If only it were that easy. Now the Lilliputian congresscritters are going to try and take down the giant. The most visible indicator that this budget is fantastic? It is angering both democrats and republicans. Obama needs to step up and defend Secretary Gates strongly right now. His focus has been wooing international partners, fixing the economy, and passing the largest budget in history. Now would not be the time to moderate his support for the SECDEF. He needs to knock some heads together on the democratic side while John McCain needs to knock some heads together on the republican side. If those two actually came together in true bipartisanship to wrangle up the corrupt congresscritters threatening to revise this budget proposal, I would have a lot more respect for the bipartisanship this administration seeks.

Any congresscritter or analyst who says that this budget “makes America less safe and secure” does not know what the &*$# they are talking about. Secretary Gates has made many decisions over the past few years under Bush and Obama to demonstrate he cares deeply about the safety of our volunteer armed forces and the safety of this country. Cutting F-22’s or the missile defense Airborne Laser or the army’s FCS will not make this country less safe. In fact, it will make this country safer by freeing up money to spend on more needed items like unmanned aerial vehicles and special forces platforms.

We can already predict what the talking points will be from both sides of the aisle. Democrats will bemoan the loss of jobs due to the programmatic cuts. Republicans will bemoan the country is not safe without more F-22’s or the FCS because they are beholden to the defense industry. And a few bipartisan congresscritters will bemoan the decrease in missile defense given North Korea’s recent failed ballistic missile attempt. I just wonder how much Gates will have to give up to these corrupt shadows of human beings in order to get the budget passed. Clearly he went all the way with his restructuring so that if he has to put a few things on the altar for sacrifice, the general outline will remain.

I look forward to seeing Gates testify before congress to see how stupid, corrupt, and hollow those people are in how they question his proposals to cut a bunch of unneeded and redundant weapons systems. Hopefully he can hold them off with Obama’s support from the White House and McCain’s support from the right flank.

Tea Parties Seem to be Growing

2009-04-02T10:33:00.003-04:00

I have read about these Tea Parties sprouting up all over the place. However, with the mainstream media not significantly covering them, I have mostly seen sporadic coverage in the blogosphere.

This map of all the Tea Party protests shows how pervasive they have actually become.

Google Map of Tea Party protests

The Argument Against Funding the F-22 Raptor

2009-03-16T19:03:00.004-04:00

I got word that a new blog reader suggested to me that I write something more substantive about the F-22 Raptor and the current controversy around its funding beyond the minor blurb I gave it my last blog post. So I would like to take a little time to explore the F-22 capability and why I believe it is inadvisable for SECDEF and Congress to fund it beyond the currently allocated 183 aircraft.

Before I begin an overview of some of the deficiencies of the pro-F-22 argument, let me say this: the F-22 is no doubt one of the coolest aircraft in the US inventory and is an incredible technological achievement. Its combination of stealthiness, advanced radar, and supercruise make it a formidable asset in the US inventory. I concede that it is a technological marvel only one hundred years since the Wright brothers. And I am glad we have them in the US capability tool set already. What we do not need is any more beyond the 183 aircraft already funded.

All decision making, but particularly military decision making, centers on accepting risk. Every decision a leader makes means another alternative is no longer an option and that window has closed. A military leader (particularly SECDEF) must make decisions about budgets and capabilities to buy assets that will necessarily close off other options and alternatives (economic speak: opportunity cost). This is why we see so many leaders hedging their bets or procrastinating for so long in the face of a moment requiring a decision: they want to keep all options on the table for as long as possible. You can read about this irrational behavior in human nature in the wonderfully relevant book Predictably Irrational. Eventually, a leader must make a decision, accepting risk in one area while trying to reduce risk in another. For example, Bernanke decreased the Fed’s target lending rate to zero accepting risk on inflation because he wanted to reduce risk of a further declining economy. One of the strategic reasons the US always keeps a number of carriers in the Pacific is to reduce risk of not being able to respond to an event or even deter countries in Asia in the first place. US strategy would rather take higher risk in Latin America and Africa in not having a carrier readily available, than in a more strategically important area like Asia.

The F-22 argument must start from the decision maker accepting risk. In a world of finite resources, the decision maker cannot protect against all threats and cannot guarantee perfect outcomes 100% of the time. They have to accept risk in certain areas and certain scenarios. I believe the US will accept less risk by investing F-22 dollars in other more germane programs, and that by continuing to buy more F-22’s it increases risk in other areas that are directly impacting the lives of our soldiers fighting two wars.

In thinking about how to analyze the F-22 funding issue, accepting risk is just the first part. The second part relies on the typical DOD analytic framework: matching resources to platforms to capabilities to threats. Working backwards, the idea is to define what realistic threats we are facing. Then determine which capabilities we need to defeat or mitigate the threat. Next, figure out which platforms have the capabilities desired. And finally, allocate resources to the platforms that achieve those capabilities. (Yes, I know its confusing, which is why the DOD process is so confusing and intimidating.) Each phase of this has thousands of people devoted to figuring out the answer because so much money is at stake, and if we get the wrong answer we may have another 9/11-type event. The interesting thing I have observed about the F-22 debate is that it is focused on the last stage of the analytic framework: matching resources to platforms. People debate whether that money should go to more F-22’s or the F-35 or towards UAVs or more A-10s or whatever. The important thing to remember is that it is the last link in the analytic chain. The other three analytic chain-links are just as important. My argument will focus on the other three links in the analytic chain: realistic threats, determining what capabilities we need to face those threats, and determining which platform fulfills those capabilities.

In analyzing the threat, here are roughly four scenarios where the F-22 high performance aircraft would play a prominent role: Iran, China-Taiwan, North Korea, and Russia (you could add China-Spratly Islands too, but it looks a lot like the China-Taiwan scenario). These are the big four that the conventional warfare crowd routinely uses to justify resource allocation to projects like the F-22. The first issue is whether we would get into a conventional fight with any of those countries in the first place, and even if we did, would the fight look anything like a conventional warfare fight, and even if it did look very conventional would the F-22 actually provide more value than another less expensive aircraft.

I agree with Thomas Barnett in his book Great Powers that there is little to no possibility we will wage war with China because of mutual strategic interests and economic interdependence. Nuclear weapons also preclude the idea of two nuclear powers going to war with each other. Even if you accept the fanciful idea that we would get into a war with China, it certainly will not look like Desert Storm or WWII. It will be a largely naval battle with carriers and her aircraft, subs, and surface ships. They will hack the crap out of our networks. They will take down our satellites with anti-satellite missiles. They will hurt our economy through economic leverage. Those areas are their comparative advantages and it makes no sense for their concept of operations (CONOPs) to include anything where they go head-to-head or even 10 heads-to-head with the F-22.

I largely dismiss war with Russia because of its nuclear stockpile. If there was ever a time where the US would need a stealthy fighter against Russia, my bet is nuclear weapons will also be on the table making all other assets virtually irrelevant. Most wargames and analysis take nuclear weapons out of the equation because they are essentially political weapons in the hands of leaders and not military commanders. Russia’s military is far weaker than ours, but their nuclear weapons render war between our two countries irrelevant as Barnett has argued so persuasively.

The fight in North Korea is all about aircraft, so that is why F-22 advocates use it as a justification. However, the North Korean military lacks any capable aircraft to compete with the F-22 (they have a few MiG-29’s that never fly because they have no parts or fuel). You could argue that it would be better able to defeat the anti-aircraft threat, but North Korean technology is so limited that we don’t need a fifth generation fighter against their surface-to-air missiles (SAMs). Additionally, the North Korean fight is about the number of targets the ROK/US forces can prosecute to drive their military back and take their capital. The North Korean military is so vast that it is more important to be able to engage many targets than to be extremely fast or stealthy. Unfortunately, the F-22 has these attributes in reverse.

The only scenario that has any relevance to the debate is a fight with Iran over the Straits of Hormuz, Azerbaijan, Iraq, the Kurds, or nuclear weapons program. Advanced stealthy aircraft could do significant damage to the SAMs and anti-aircraft threats in Iran. But that assumes two things. First, it assumes that the F-22 is the only stealthy aircraft we have which it isn’t. Second, it assumes the current CONOPs for the suppression of enemy air defenses will not change with more UAVs in the force structure (i.e. swarms of UAV’s against SAMs). Another problem with this scenario using this scenario as F-22 procurement justification that is trying to destroy all of Iran’s nuclear weapon infrastructure will be virtually impossible. The analysts in the DOD and Israeli military now understand this fact; it’s too decentralized, too far underground, and too far away. In the Iran scenario, as well as others, the deployment of the F-22 could be seen as an offensive move which escalates the situation out of control instead of de-escalating tensions. The F-22 is such a capable aircraft that it will be seen as a first strike weapon because other countries, particularly Iran cannot hope to stop it with their conventional weapons.

I know I have just touched on each of these scenarios, but I did not want to only focus on wargaming these particular scenarios. My argument is much more comprehensive. Suffice to say, the threats this country faces are far more asymmetric. Our adversaries around the world see the success such asymmetric fighting has against us in Iraq or Afghanistan and will seek to replicate it in the next war. The F-22 program was initiated in 1981 to combat the next generation Soviet fighter. Instead of generating theoretical threats in a distant future, we ought to consider the demonstrable threats we face now or in the very near future. Additionally, if any of the above scenarios were to actually occur, the adversary would focus mostly on its asymmetric advantages anyway rather than try to achieve air superiority. They know our weaknesses are casualties, political will, coalition cohesion, cyber defense, and satellites. Those are the areas our adversaries seek to exploit.

I touched upon the second part of the analytic process, determining capabilities to address threats, in my brief analysis of the previous four scenarios. The F-22 was designed capable of SEAD missions and I will look at its capability to do that first. Suppression of enemy air defenses (SEAD) is underinvested capability, which leads to the argument to update and expand the number of our SEAD assets like the F-22. SEAD is the ability to destroy or disrupt the adversary’s capability to shoot down our aircraft.

The problem is that in every wargame I’ve analyzed and scenario I’ve ever read, SEAD is one of the least important capabilities essential to achieve overall success. Let me explain this to be clear, because many USAF-types would say that air superiority is the key to all else being done on the battlefield. In all wargames and scenarios, the US always uses every tool at its disposal to win the fight; amphibious, naval, undersea, space, communications, intelligence, targeting, etc. SEAD is always a capability that we need up front to prosecute the rest of the war. If you cannot fly around the battlefield at will, you lose the ability to support troops, medevac wounded personnel, conduct intelligence or transport equipment. SEAD may be the first capability required for overall mission success, but it does not mean that is the most essential. Other capabilities needed further on in the fight like intelligence, surveillance, reconnaissance (ISR) or communication networks or civil-affairs forces or just boots on the ground are often more essential in determining the outcome of the wargame or scenario than SEAD. The analyst must say, “Mr. President or Mr. Secretary, we only have finite (and increasingly shrinking) dollars to pay for all these capabilities, so choose wisely in which ones you want to invest.”

The other main capability that the F-22 platform brings to the table in spades is air-to-air combat; it was fundamentally designed to dog fight. The question is who it would fight in air-to-air combat in any of the above scenarios. Iran’s air force is awful and could easily be destroyed with current air-to-air capabilities. Their most advanced fighters are the F-14’s we sold ‘em 30 years ago, and they haven’t had spare parts for them for a long time. Who knows if they even work. Russia has some great aircraft like the Su-37 but could not field them in numbers to make a dent in our overall air-to-air capability. North Korea has a few MiG-29’s that don’t’ have parts or fuel but otherwise owns 1st to 3rd generation fighters. China is developing the J-11 which would give the F-22 a run for the money, but their other aircraft are decades old and our current air-to-air capabilities would have no problem defeating them, even in the massive numbers we would expect them to employ. So while the F-22 is great at air-to-air combat, it’s a capability the US Air Force has rendered obsolete through decades of excellent technology and superior training.

It makes me think of the heavily armored French knights that fought in the battle of Agincourt. The capability they provided (ability to dispatch infantry) was rendered irrelevant with the introduction of the longbow. The longbow could easily target the knights out of their range and to some degree penetrate their armor. The knights tried to have the longbow made illegal in war, because they did not want to adapt to the modern way of war. Being a knight was a privilege and honor, and they did not want to be outdone by poor uneducated archers. Similarly, the F-22 is the premier knight in an age when knights are no longer the premier capability. Air-to-air combat and suppression of enemy air defenses will remain a necessary capability for the foreseeable future, but it is not the center piece to success it once was. Therefore, the argument to spend the vast sums of money on a capability that is providing decreasing marginal rates of return is not a wise investment.

The third link in the analytic chain has to do with determining which assets or platforms provide the capabilities you need. If the capability DOD needs is “blow up a target” it has dozens of platforms that can achieve that capability; infantry, artillery, helicopters, aircraft, UAVs, tomahawk cruise missiles. You get the idea. As a platform, the F-22 is not alone in providing air-to-air combat capability or suppression of enemy air defense capability. Once we decide that we want a certain capability, then we have to determine the right platforms or assets that can provide that capability. The F-22 provides two capabilities: air-to-air combat and suppression of enemy air defenses. It also provides contributions to other capabilities with its Active Electronically Scanned Array (AESA) radar like ISR. For the moment I want to focus on the main capabilities the F-22 provides, air-to-air combat and SEAD. Besides the F-22, the US DOD has other air-to-air platforms like the unbeaten (107 kills to 0 losses) F-15, the ubiquitous F-16, the Navy F-18, and the F-35 in development. To get the capability to defeat an adversary with an air-to-air capability the US would want a combination of all of these platforms, and indeed we do and we will. The question is whether we ought to buy so many of only one type of platform that we create risk in other areas by having only one type of asset. We already have roughly 100 F-22’s in the inventory and will have 183 before the program is ended. With the mix of all the other aircraft that provide air-to-air capability, I do not believe we need to purchase more of that specific platform. After 183 aircraft, the marginal utility of each purchased aircraft decreases because it is contributing so much less to the overall air-to-air capability. The F-22 mission readiness percentage (the percentage of total aircraft ready to fly that are not used for training or in maintenance) is also lower than many other aircraft because of its sensitive stealthy characteristics. Instead of 70-80% mission readiness ratings typical for combat aircraft, the F-22 has only a 60% mission readiness rating, which adds further credence to the argument of decreasing marginal utility.

F-22’s also contribute to the SEAD capability. The primary DOD asset to conduct SEAD is the F-16 and the future concept of operations (CONOPs) for the air force is to employ as many F-22’s against the problem as they can in addition to the electronic warfare aircraft to jam the enemy radars. The CONOPs need to change. Of course you can use the same CONOPs as we have for the F-16 for the past several decades, and just replace them with more advanced F-22’s, but you remain stuck in an outdated concept. This static idea of SEAD is similar to the French CONOPs for using tanks after WWI as infantry support vehicles and interspersed them amidst infantry units instead of packaging them together as armor units like the Germans. What if the CONOPs for the suppression of enemy air defenses relied less on manned aircraft and more on unmanned aerial vehicles (UAVs) or swarms of small UAVs? If the issue is a threat to human life, UAVs like the MQ-9 Reaper could seek out enemy air defenses just like the F-16 but without putting a pilot’s life in danger. Swarms of small UAVs could overwhelm the radars used by the enemy air defenses and would allow other assets to sneak in and destroy the missile launchers, radars, or command and control sites. In fact, enemy air defenses are not the only military platform vulnerable to swarms of UAVs, F-22’s are themselves. The F-22 has unmatched radar and advanced weaponry, but it has a limited number of weapons that it can carry and when exhausted, it is SOL. Swarms of UAV’s could overwhelm it just like swarms of boats could overwhelm another main US platform, the navy carrier. UAVs are the true next generation aircraft because the engineers do not have to plan a cockpit around a human being so more sensors can be installed, more weapons can be carried, and the aircraft can make more difficult maneuvers (more g’s) without having to rely on a physically stressed human being to pilot it. Instead of relying on a CONOPs and the last advanced fighter from the twentieth century, it makes more sense to experiment with a new twenty-first century CONOP based on twenty-first century aircraft like UAVs.

As to the lesser capabilities that the F-22 could provide like ISR or ground support, there are far better platforms for these functions than the F-22 and they cost a lot less. While these other capabilities are important and the F-22 could indeed support the current efforts, the fact is that not a single F-22 combat mission has been flown in almost 8 years of constant war. The argument to buy more F-22s for its other capabilities instead of its central capabilities of air-to-air combat and SEAD badly misses the mark.

The fourth and final link in the analytic chain is allocation of resources to platforms. In other words, the budget process allocates dollars to specific companies to make specific platforms that will provide the military with the capabilities it needs. Even in this analytic chain-link, Lockheed concedes that the F-22 may not be the best investment of dollars, but advocates keeping the higher budget for the aircraft because “the US will lose upwards of 95,000 jobs.” That number not only includes people who work on the F-22, but also indirect workers for subcontractors who work on a multitude of other projects and will devote their resources to other projects if the F-22 production were cut. Additionally, the people who work on the F-22 in certain areas like avionics or stealth design are in high demand for the development of other aircraft like the F-35, F-16, C-130, or advanced C-5. Many of those people could even stay at Lockheed and make the switch to a new project. Finally, the budget cut of the F-22 would end the production line in 2011, not next month. Thus, the people employed to create it, even if they did lose their job, which is not certain, would do so over the next several years and not next month during the hardest part of this recession so far.

DOD budgets will have to decrease or at least flatten due to the severe economic crisis facing the government. The DOD has three next generation fighter aircraft: F-22, F-35, and F-18E/F. It cannot continue to fund all three at maximum levels and ought to cut out one of them. While that argument does not specifically mean the DOD should cut the F-22, it does lend support to reducing its budget when combined with all the other evidence against continued funding. At $180 million per copy, the DOD could buy roughly 4 advanced F-15s. Additionally, the F-22 program has had significant cost-overruns during its lifetime. Our country is facing difficult economic choices, and I believe that programs that have habitual cost-overruns ought to face the chopping block first. The F-35, with its multinational development effort, spreads the cost and risk over many allies rather than just the US. The F-35 provides roughly 80-90% of the capability of the F-22 at half the prices. That cost calculation ought to be included in any discussion of whether to continue funding the F-22 or waiting a until 2010 for the F-35 to be introduced.

The Air Force is making the argument that they need 600 F-22’s, but they will settle for 381. The Air Force is using this number as the starting position for their bargaining instead of starting somewhere more realistic. There are no known independent studies that analyzed current and future threats to determine 600 total F-22’s being added to the US inventory and using that number as justification for getting almost two thirds is disingenuous.

The F-22 Raptor adds decreasing marginal utility to the US ability to wage war against its adversaries who are looking for asymmetric advantages against our powerful conventional military. In a climate of decreasing DOD budgets we ought to be thinking about next generation capabilities to combat the threats we face instead of supporting a relic of the Cold War.

Government Spending Bill Full of Pork

2009-03-12T15:51:00.002-04:00

It is no secret that the recent $410B spending bill is full of pork. In fact it contains over 8,500 separate pork funding items directed by Congress-critters.

It is no secret that Congress-critters dole out this pork money to friends and campaign contributors. They proudly admit it and say they are helping citizens directly through the democratic process. Puhlease!

Clearly pork projects are corruption at is very essence. I am glad that pork barrel projects are getting the attention they deserve. Only with greater transparency will this corruption be reduced.

But let us go further for a moment. What if pork barrel projects are beyond just corruption and pay for access (as I wrote here) and actually something more sinister and troubling.

Froma Harrop highlights some of the problems with pork projects in her article.

The author comments on the particularly sordid nature of Randy Cunningham or John Murtha with,

"Member of Congress obtains pork for a group or business. The recipient returns some of it in the form of campaign cash or, in at least one case, antiques for the home. Former Rep. Randy Cunningham, a California Republican, was famously brought down by a bribe-for-earmark scandal including Persian rugs.

The FBI is now investigating PMA Group on suspicions of making phony campaign donations to select representatives. Rep. John Murtha has received generous contributions from the employees of PMA, a lobbying firm whose clients have enjoyed earmarks, courtesy of the Pennsylvania Democrat."

My question to those who agree that the above statement is in fact true is how many other congress-critters receive money from anyone they have every delivered pork money too? And if they did, are they not just as guilty as Cunningham and Murtha? And moreover, is what congress-critters are doing beyond just simple corruption, but in fact, money laundering the tax payer money through appropriations to private individuals back and then back into their pockets through agreed upon donations.

The circle of money laundering from tax payer's pocket to congress-critters pocket is long but clearly identifiable.

Next Hurdle for AI Overcome

2009-03-12T14:17:00.001-04:00

When Deep Blue beat Gary Kasparov, every futurist and technologist was saying that it was only a few more years before computers would be able to surpass humans on all fronts, not just specific games like Chess. We now know that was too ambitious an agenda, and that AI is still evolving as we gain greater understanding of our own brains and what the nature of intelligence is.

The Asian board game “Go” has been thought to be out of reach for computers because of its sheer complexity and number of possible outcomes. Computers are able to beat humans at Chess because of its relatively limited number of outcomes and number of potential moves on each turn. Go has far fewer restrictions. In fact, it is an exponential growth in number of potential moves and potential outcomes. Thus the strategies employed in Deep Blue (raw calculation speed traversing every possible branch down a game decision tree) were thought to be incommensurate with the strategies needed to play Go.

Sure enough, the experts were right. But what they got wrong was how computers can still beat humans because they can calculate probabilities much faster and more accurate. By running millions of simulated games through the software, programs designed to play Go begin to “see” patterns of probabilities. For instance, after a million games, there is an 80% probability that the development of a particular area of the board will result in a winning game. The software uses the Monte Carlo method of simulations to look for the highest probabilities rather than tracing each individual decision tree after the player concludes a move.

Despite the software still being in the stages of raw data computation rather than anything approaching “thinking,” this is good step for AI researchers because it will further inspire new avenues of attack on the issue of artificial intelligence.

Wired article here

New Map of Knowledge

2009-03-12T14:07:00.002-04:00

Los Alamos National Laboratory researchers have created a new map of human knowledge based on search parameters in 23 academic databases (including JSTOR, Ingenta, and some from UC and UT schools). It is phenomenal how much the picture of the relationships of human knowledge looks like a galaxy.

I suppose order and complexity exist independent of the means by which it is displayed. Whether it is galaxies, knowledge linkages, or fractal pictures, complexity uses any domain as its canvas and any linkages as its palette.

Shocking Picture on Foreclosures

2009-03-12T13:49:00.002-04:00

I remember when I saw a county-by-county color map of voting patterns in 2000 (Bush v. Gore) and how wide sections of the country were deep red, with splotches of blue for the major cities in each state. I remember and almost identical map from 2004 (Bush v. Kerry).

I remember thinking that the analysts and commentators who said its Blue states vs. Red states clearly don’t know what they are talking about. It is suburban and rural vs. urban. That is the pattern, replicated across every state (except my childhood home of Connecticut which is blue throughout).

Jonathan Stein comments on a new map of the foreclosure mess across the country. The reason I bring up the colored county map in Bush-vs.-Gore and Bush-vs.-Kerry is that this map is telling us something beyond the typical myth being propagated in the media. The myth of those elections is the blue state/red state divide, when in fact, it is the urban/rural divide that truly determines politics. This foreclosure map demonstrates the housing crisis is everywhere across the country but limited to a few general areas in Arizona, California, Florida, and Nevada, which accounted for about 25% of all foreclosures last year. Only 32 counties across the entire country are responsible for 50% of all foreclosures last year.

If you look at the map, you can see vast areas, including whole states, where foreclosures are not the problem. Of course these areas have other economic problems, but they do not have specifically a housing crisis or foreclosure problem.

The significance of this map is that it demonstrates how geographically focused our housing problems are in this country. It makes the political prescriptions by those in Washington DC seem too broad and general, rather than the targeted measures a map like this indicates is necessary. In other words, we don’t need an unprecedented deficit-driven bill to help all houses in foreclosure. We need to treat this like a disease and help the most “infected” areas first with targeted measures for those 32 specific counties. The measures I am thinking of do not include bailouts, but they do include greater latitude to local bankruptcy judges or local banks to restructure loans. Instead of making the entire banking industry open to restructuring loans, why can’t we create targeted measures?

Regardless of the prescription for this housing crisis, the foreclosure map offers a greater understanding of the true nature of our economic problems.

These Are a Few of My Favorite Things

2009-03-10T14:00:00.006-04:00

The disastrous economic news is pervasive and all-encompassing. We see it on the internet, the television, the radio, at work, with our friends, and even with random strangers at a meeting or in a bar. The mood in this country, and indeed around the world, is decidedly negative about our economic prospects for prosperity and success.

As much as I like to revel in the bad news as a means of blaming the uber-rich or Wall Street bankers or politicians or overstretched home-owners, it is not healthy to reframe your entire existence around such bad news. I like to think I am generally a positive person. My family and friends would probably disagree and say I am a pessimist. I come back to them, saying “No, I’m a pessimistic-optimist.” What does that mean? It means I expect the worst but don't obsess about it and when the worst does not happen, I’m genuinely surprised and happy. It is a weird way to live and an unusual outlook to have, but it has served me well in the past. I actually end up having a more positive view of the world than many people I know because I’m never disappointed (my expectations are too low).

In light of my pessimistic-optimism, I would like to review a few good things that have recently developed since this economic crisis began. This overview is not meant to support a particular government policy or ideology. Rather, it is meant to help those who feel helplessly surrounded by negative news, accelerating downward trends, and the feeling that the media is excited it's TEOTWAWKI. Each one of the downward trends (property values, unemployment, foreclosures, stock markets, etc.) has a positive element if you are willing to look for it. While the positive trend may not be as significant as the downward trend, it can still be a driving factor in future growth, and is surely worth more than classification as a “silver lining.”

1. The environment is better off than any government regulation or Kyoto treaty could ever dream of doing. The economy is shrinking at a pace not seen in 80 years. This means that manufacturing and factory output is significantly reduced, thus the environment is spared all sorts of pollution and CO2 poisoning. While I do not believe in global warming, I do believe in pollution and don’t want to see our oceans or air continuously polluted. Reduced economic output means less pollution, so if you are an environmentalist you should be partly happy at this one. It did not take government or endless meetings and conferences to reduce carbon emissions or pollution; it took a subprime loan crisis to create favorable environmental conditions. Let’s see scientists put THAT in an environmental model.

2. Illegal immigration is dropping off a cliff. Illegal immigrants from Mexico and Central America came here because the jobs were good, the cost of living was good, and opportunity was better than in their home country. The jobs are drying up and people are not starting new businesses because of the toxic economic and business climate. Many illegal immigrants are going home, but even more importantly, many are not even coming here in the first place because they see what is happening with our economy. For them, it might just make more sense to make the best of the opportunity in their home country. (This argument is totally different than legal immigration which we need more of and need to figure out a way to attract or bribe more educated foreigners to our shore.)

3. Housing is becoming more affordable for many Americans, including me. I was not one of those twenty-somethings that bought a $500k house because I was making $60K a year and thought that’s the best deal I could get in Washington DC and it will continue to rise forever. I stayed a renter, and have thus been proven wise in my decision not to overextend my financial situation during the real estate bubble. Housing prices are dropping precipitously and now I may be able to afford a house if they continue to drop a little bit more. There is a great picture that shows median income remaining flat for the past several decades (when accounting for inflation) with housing prices rising exponentially. The traditional ratio between housing prices and median income has been 3:1. During the housing boom a few years ago it reach as high as 15:1 in some places, notably NYC and communities in California. People cannot sustain that rate because they will never be able to pay it off no matter how much their incomes increase over the years. Now that housing is coming back towards the traditional ratio of 3:1 it will be affordable for many young people to buy a home for the first time and begin the road of the American Dream. It was not a government program or a philanthropic effort that made housing “affordable,” rather a correction in the economy and the marketplace.

4. Oil prices dropped through the floor making everything cheaper. I read an article that said that because oil prices dropped so drastically, each family in America would save roughly $1,500 over the course of 2009 because of lower prices. The argument the author was making is that should be stimulus enough. I don’t agree, but you cannot argue with the numbers. We are all saving vast sums of money by not making “the greatest transfer of wealth” to sovereign wealth funds in the Middle East (remember all those Economist articles about that last summer). Petroleum prices will inevitably rise because the markets will not ignore China and India’s growth forever, so appreciate how cheap a tank of gas is the next time you fill your car up.

5. Iran, Russia, and Venezuela have a lot less money and influence to act contrary to US interests in the world. Each of the three countries relies on high oil prices to subsidize government expenditures and the oppression of their people. The deals each made with their citizens was “I’ll keep bringing home the bacon because of higher oil prices and you keep supporting my claim of legitimacy and whatever international actions I decide are best.” That deal is coming under increasing strain as the average price of oil is below the rate used by each government to plan out their yearly budgets. That means dipping into savings or going into severe debt. Ultimately, this means less adventurism with Bolivarism in South America, Khomeinism in the Middle East, and Putinism in Eastern Europe and Russia. They just cannot afford to make massive government expenditures to counter every US move at globalization or promoting its interests. So while economists and politicians bemoan the decline of free market ideals and globalization, at least those three ideologies will not be able to fill the void.

6. Gun ownership has skyrocketed since Obama’s election and a responsible citizenry with guns is able to protect itself from unseemly characters as well as from the government. I have even read stories about recent lack of ammunition because so many people are buying certain types before an expected government crackdown on ammo. I happen to believe that more guns in responsible citizens’ hands means a safer society and one that can protect itself from the government. With increasing government roles and responsibilities in the lives of taxpayers, increased gun buying is a prominent indicator that many people are preparing to keep the government out of their physical lives even if they cannot keep it out of their wallets.

7. Declining government revenues is a good excuse to trim the DOD budget fat. There is so much pork and useless junk being bought with the $537B from OMB for fiscal year 2010, I will not go over all of them. Suffice to say, here is a summary (find example from archives). It is virtually impossible to cut well-funded and well-connected DOD programs during a good economy, and it is still very difficult in a declining one. Just look at Lockheed’s advertising campaign to keep funding for the F-22 fighter jet: building the F-22 does not make the nation safer or more secure, it saves 95,000 jobs over the next three years. That argument entirely concedes the F-22 is not right for US national security, but because it provides jobs billions of taxpayer dollars should fund it so they can keep their jobs. Maybe that argument makes sense to some but not to me. There are dozens of other multi-billion dollar projects like the F-22 that need to be cut or axed all together because the defense budget has become too bloated and we are trying to do all things for all security environments. Shrink the budget, force some hard decisions, and our military and security forces will be better for it. A bigger budget does not mean safer national security despite arguments by certain congressmen to the contrary. The current economic crisis will grease the skids for Gates and Obama to take a scythe to the DOD weeds that have grown since 2001.

8. Risk management in financial markets has been unmasked as a fraud and trickster. There is now more caution when evaluating portfolio diversification, new bond issuances, emerging markets, or correlation between asset classes. The fundamental assumptions of the entire economic boom rested on the principle of Gaussian distributions (aka the normal curve, aka the bell curve) according to the formidable mathematical mind of Benoit Mandelbrot, the discoverer of fractals and inventor of fractal geometry. His new reprinted book, The Misbehavior of Markets, is a fascinating analysis of the free market system. More importantly, he lucidly demonstrates the false assumptions of risk managers the world over. All their assumptions are demonstrably false: rational investors, continuous price changes, and a Gaussian distribution of price changes. The last one really hurts investors; it assumes economic decline over the past six months is almost a mathematical impossibility. Therefore, banks, hedge funds, 401k advisors all assumed something like this could not happen. So while we are in the middle of the economic crisis it looks bad, the fact that serious scholars and even common investors are questioning the assumptions and models based on classical financial theory risk management is a good thing. It will mean a greater understanding of the market system as a complex adaptive system, and ultimately better tools to evaluate risk, diversification, and solid value rather than the pseudo-scientific alchemy currently in practice.

9. With so many people recently unemployed, there is greater opportunity for people to discover their passion and work not just for a good paycheck like in years past but for something they truly enjoy. While there are elements of my job I enjoy, my job does not satisfy me nor provide me anything close to what I would call a “calling.” The steady paycheck, security of a job, and professional development make giving that up a hard choice. But if I were fired (or more likely, my government contract was not renewed), I would be freed to pursue a variety of new career paths or options I never thought possible. Of course people getting laid off or fired is a bad thing, but it may just give them the freedom to pursue a career path they had not otherwise intended without a push. One can only hope a few of those people invent something new, create a new service, or start a new business in the future (God-willing if the government does not stop them).

10. Renters do not have to worry about declining housing prices, underwater mortgages, or costly repairs. As a renter, I have none of those worries that home owners have. Those worries are persistent even in a growing economy when you have a job, but they are more acute in difficult economic times. Renters have their own sources of stress, but it can be shown to be a good thing not to have a home with a large mortgage that will only cause additional stress or even financial hardship.

That is my list of ten things I feel good about in the midst of an economic crisis. I am sure I am missing some big aspects, so please contribute in the comments section if you think of some I missed.

The media and government want you scared and cowered so you are more malleable. I disagree with our country’s leadership that we face catastrophe if government does not step in every aspect of our lives or that we will have 4% economic growth next year. Negative trends exist in our economy and polity, but so do positive ones.

New Blogger and Random Pattern Sitings

2009-03-05T21:14:00.006-05:00

I wanted to welcome Dave Corley to the blogosphere, after his wonderful post on the Detroit 3. He will be a guest blogger from time to time, or whenever he feels like writing a story about something that involves drugs and strippers.

I know I have not been posting much recently. Work has actually been busy and I just haven't had as much time to find interesting articles or ideas to write about. A few of you have noticed this and sent me fascinating stories or articles that I intend on writing about in the near future.

Below are a few pretty cool stories I found over the past few days.

There is actually a website called DNA Rainbow that creates pictures based on every base pair of molecules in the human genome. There are actually some amazing patterns in our genomes when they are represented pictorially with colors rather than with the typical A, C, G, T monikers. Is it like searching for patterns in the clouds, creating structure and patterns where there is only fractal chaos? Sure. But the patterns may inspire us look more deeply for patterns in our genes.

Someone actually figured out how the government stimulus package will work. It is straightforward and easy to understand based on simple rule sets about how government interacts with the private sector.

Finally, a CalTech grad student named Virgil Griffith conducted an "interesting (albeit somewhat unscientific) study relating music preferences with SAT scores. He found that those students with the best SAT scores favored Beethoven, and those with the worst scores favored Lil' Wayne. Most of the other types of music and specific artists fell somewhere in between that spectrum. He also created an easy to understand picture representing the spectrum of SAT scores correlated with music preferences. All we can say is that the music preferences are correlated with SAT scores. We cannot say whether smart students favor certain types of music or whether a certain type of music makes certain students dumb. Interesting nonetheless.

I intend my next few posts to be about topics and patterns with a little more depth. But these few interesting websites should keep you busy for about ten minutes.

The Big 3...Anchors

2009-03-01T16:35:00.002-05:00

Before I discuss The Big 3, let me tell you a quick story first.

About seven years ago, my Uncle Charlie came to my dad and asked him for some money. My uncle’s business started to decline and he needed some funds to get back on track. My dad, being the nice guy he is, gave him a few grand thinking it would help my uncle get back in the right direction.

Six months later, my uncle came back and asked for more money this time. My dad asked where the money had gone and my uncle rambled on about rising expenses and making payroll, etc. Again my father game him a few thousand dollars and sent him on his way hoping it would be the last time, but it was not. My uncle began coming back to my father for larger and larger sums of money backed by numerous outrageous stories and excuses. My father became tired of it after a while and just began to mail him checks so he wouldn’t have to be bothered by my uncle’s big productions.

This went on for years. About five years after my dad was sending him checks every month. One day one of his checks came back returned to sender. This puzzled my father so he got into his car and drove to my uncle’s office. He arrived to an empty office with just some employees packing up boxes. My father asked the receptionist what was going on. The receptionist told him that had to move to a smaller office because they defaulted on rent. My father asked where his brother was. The receptionist laughed and said that he rarely came into the office anymore. My father was shocked. He asked her how business was. The receptionist began to paint an ugly picture. The business had been slowly tanking for years and my uncle was spending his days at strip clubs doing drugs instead of trying to save the business. My father was furious. He drove around to every local strip club until he found his brother. The receptionist was right. His brother was there surrounded with a stripper on each arm and lines of cocaine sitting right in front of him. My father tapped him on the shoulder and told him they needed to talk.

My father brought him out to the parking lot and became furious with him. “This is what you have been doing with my money all this time? What do you have to say for yourself?” My uncle acted as if he was not guilty, “This is the lifestyle I lead. Business has been slow but I need to maintain the lifestyle I have established for myself”. My father angrily responded, “You have to adjust your lifestyle to the income that you have”. My father then confronted him about the business failing and slowly my uncle seemed to understand his wrongdoing. My father laid down an ultimatum. My uncle was to stop wasting his money on drugs and strippers and he was to get the business headed in the right direction. My uncle swore up and down that he would and even began to spit out ideas to revive the business. My uncle asked for a larger some of money this time to do this. My father was frustrated, but also encouraged that his brother was going to do what he said so he wrote him the large check. My father parted with him by saying, “If you deviate from this plan in anyway, there will be no more checks from me”.

Two months went by and one morning my uncle banged on our door. His was hysterical and upset. He didn’t even bother to make an excuse this time. He owed large sums of money to drug dealers and loan sharks. He begged my father for even more money this time. My father lived up to his word and kicked him out of the house.

Later that day there was another banging at the door. This time it was my uncle’s stripper friends, drug dealer and loan shark. The all clamored about how my father needed to pay his brother so they could get the money they were owed. My father refused to give them a dime. One of the strippers yelled, “I just bought a house based on the money your brother was giving me”. The loan sharked barked, “I’ve loaned so much money to your brother that if I don’t collect I am in deep trouble”. My father smiled and explained to them, “Listen, you never bothered to find out what my brother did or where his money came from. Had you done so, you would have found out that his business was being run into the ground and the only money he had was the funds that I was giving him. Had you discovered that a long time ago, you wouldn’t have relied so heavily on him and would have found other customers that offered more financial security. You chose not to because it was easy just to sit back and take the money from my brother instead of foreseeing this unfortunate event and making necessary changes. That is your problem and not mine”.

My father shut the door on them and walked away. I stopped him and asked, “Dad, aren’t you worried about Uncle Charlie? Those people are probably going to hurt him”. My dad looked at and said, “David, this was probably the toughest decision I ever had to make. There were two components to this problem. First was your uncle’s poor decision making. Second were the funds I gave to your uncle for years that made the situation much worse. What dawned on me was that no matter how much money I was going to give your uncle, he was eventually going to answer to those people for his mistakes. Giving him money to get by only delayed the inevitable. The only way your uncle is going to learn what he did wrong is to hit rock bottom and pick himself off the ground. Yes, some people might get hurt this way, but at least I know the cycle ends here. The problems will only be fixed when your uncle chooses to fix them himself.”

Ok…I have a confession to make. I don’t have an Uncle Charlie and the above story never happened, but I wanted to illustrate the point of how ridiculous it is that we are giving money to The Big 3 right now. I know The Big 3 aren’t spending their money on drugs and strippers, at least I hope they’re not., but The Big 3 have been making extremely poor decisions for over a decade and we are now footing the bill. It’s a forgone conclusion at this point that GM and Chrysler are going to fail. The only one with a fighting chance is Ford.

That is a bold statement so I want to make sure it sinks in. At least two of these car companies are going to fail no matter what amount of money we throw at them. It has been a result of reckless management, horrendous decision making and greedy labor unions dictating action. My uncle in the story is GM. A long time ago they were very successful and were able to support the expensive labor programs they put into place. As time passed the business changed and GM was sluggish to respond. Foreign car makers made sleeker, higher quality cars for less money and infiltrated the US market. Instead of adapting to change and responding with new and innovative cars, GM continued to manufacture irrelevant cars. Refusing to look their problems in the face, GM borrowed money and continue to spend as if everything was ok and it was not. GM continued to pay executives that failed their objectives big dollars and continue to support programs that yielded no cash inflows. Did you know that their Saturn brand has never turned any real profit? Its shocking to think that a car company would carry a brand for so long that never generated a profit, but that is what GM does best. They ignore the facts and press on with their excessive spending.

Before you come to GM’s defense, I want to ask you to do one exercise. Go to the GM website and make a list of the cars you honestly would like to purchase in the near future. You will be lucky to indentify two and one of them will most likely be the Cadillac Escalade. Now go to the websites of Toyota, Honda and Nissan. Each one has five to six cars I would like to drive home. GM is completely out of touch with what US consumers want and their car lineup is proof. They lucked out with the Cadillac Escalade which the Hip-Hop community has carried for the last decade. GM failed to foresee market changes and never bothered to tap into what US car consumers really want and need.

GM has been borrowing money for years during their slow decline but never tried to change their ways. Now the US Government is cutting them checks and there is no end in sight. They asked for billions of dollars over the summer and said that’s all they would need to get back on track, but here there are again in February asking for DOUBLE the amount they initially wanted. There is only one sure fire way to solve GM’s and Chrysler’s operational problems and that is to cut them off.

I know all their suppliers will fail along with them and I have no sympathy for them. Just like the strippers, drug dealer and loan shark in the above story, they should have recognized potential trouble years ago and began to diversify. They should have looked to other car companies and into different industries to manufacture new products. If you marry your entire business to a failing company, like GM, and turn your shoulder to their problems, you deserve whatever comes your way. Smart businesses see what’s coming ahead, diversify and make changes to stay afloat.

The US Government, or my father in the story, needs to stop giving The Big 3 money. Every time you give them money, you are delaying the inevitable and are allowing them to make the situation even worse. These companies will keep coming back with their hands out until we don’t have any money left to give them. GM and Chrysler are going to fail. Ford has a chance because they actually make a few cars that people want to drive.

And ask yourself this question, what precedent do we set for American manufacturers in financial trouble? What happens if the aviation industry comes next? Where does the bailing out stop?

I have a solution to this problem. Take the $30 billion we are going to give them and shut down all GM and Chrysler operations. Give some useful equipment to Ford. Sell off all other capital assets to other foreign car manufacturers and anyone else who can make use of their assets. There are plenty of US companies that would love to pick up some discounted equipment that they can’t afford brand new right now. We would then put all of GM’s employees and suppliers on a five year tapered compensation transition plan. For example, let’s say ACME Tire company gets X amount of dollars from GM right now. We go to ACME and say, “Alright, we’re not going to leave you in the lurch but you need to find business in other areas. We will give you the full X amount of dollars you received last year. Then next year you will receive 80% of X dollars and 60% the year after until you receive nothing. You are now on five years notice to change your business plan to attract new revenue.”

We would roll this plan out with all GM employees as well. I understand they won’t find jobs making the same amount of money right away, but the tapered compensation plan will ease the transition. And let’s be real here, their salaries were inflated for many years now. The labor unions were able to secure outrageous contracts that paid simple laborers sometimes two to three times what they job’s compensation actually warranted. How will we fund this plan? With the $30 billion dollars we are most likely going to give them and with the additional funds we can raise by liquidating their assets.

You can’t throw money at a problem and expect it to fix itself. GM and Chrysler’s problems run so deep that they can’t be fixed at this point. The resurgence that some of these car executives are talking about is a fairy tale. Let’s cut them off and stop delaying the inevitable. The longer we wait and continue to give them endless funds, the bigger the problem will become. We need to end the cycle of spending right now.

I’m sorry ladies and gentlemen, but the once great US car manufacturing era is not only over, it ended years ago.

A Year in Review

2009-02-24T21:03:00.002-05:00

There is only one "Year in Review" you need to read to understand the themes and trends of 2008. The author is, of course, Dave Barry.

Read his 2008 Year in Review.

This is possibly the funniest and most accurate assessment of last year I have read.

Essence of World Economic Crisis

2009-02-20T14:36:00.004-05:00

This is a picture of empty idle ships in a huge Singapore harbor. That is the practical effect of a slowdown in consumer demand in the US and around the world in general. (h/t Chris Laird)

(original story here)

Light Shines In Switzerland

2009-02-19T13:02:00.004-05:00

UBS, the largest bank in Switzerland, has agreed to divulge the names of Americans authorities suspected of hiding money in offshore accounts to evade taxes. (Apparently, the DOJ is after even more names, upwards of 19,000, on wealthy Americans who used UBS to avoid paying taxes, story here) The bank has admitted to defrauding the US government of millions in taxes and has agreed to settle for $780 million. UBS is also handing over the money and the names as part of the settlement. Transparency was just forced onto the Swiss banking industry.

This settlement is huge! It is not the indictment, or the release of names, or even the penalty UBS must pay; rather, it is the idea that Swiss banking will no longer be free from the reach of government taxation. No longer will rich people in the west, drug smugglers in the south, human traffickers or weapons proliferators in the east be able to hide their millions in Swiss bank accounts without a little voice telling them they are not truly secure.

Of course, this will affect wealthy people in the US, and they will be less likely to be able to hide their money from the government. But more than that, this verdict means that governance is reaching areas where it has been absent for a long time. Experts in national security see places like Afghanistan, the border region with Pakistan, Somalia, and other places as absent basic governance. That absence is one of the reasons those areas are so unstable and make great breeding grounds for terrorists.

Similarly, there has been a lack of governance in Switzerland in its secrecy of its banking customers. Governments have been unable to track those customers or levy taxes against them. Now that globalization has created a UBS megacorporation that values its business in the US and cannot afford legal troubles in US courts, the incentive structure has changed favoring more transparency. First it will affect the wealthy in the US and other Western nations. But the door has been opened to greater transparency. It is only a matter of time before those running the black or gray markets will face the light of openness and transparency.

Governments have two essential powers of sovereignty they cherish most, and will protect the most: war powers and taxation. Governments that cannot effectively tax its citizens or the goods and services that flow through its borders are weak and unstable. Switzerland has maintained its banking secrecy laws for hundreds of years. That capability was viable in a world where it was difficult to track money, economies were national in essence, and governments had limited ability to enforce global norms of law and behavior. Each one of those tenets is falling away with globalization.

Money is mostly electronic bits now, especially the millions that the wealthy move around. Those electronic bits are much easier to track and then to tax.

National economies are no longer really "national." UBS is a Swiss bank, but it owns assets and banks all over the world. Same for every single multi-national corporation. (That is why this idea of "buy American" is so stupid. That's a whole blog post.) So UBS is open to prosecution in the US with many of its banks and assets in this country even though it is a Swiss bank.

And finally, international law and global norms of behavior are more accepted. International criminal law, while still nascent and without teeth is becoming more accepted in national court systems. This emergence of a global rule set of behavior (government taxation of its citizens being included) has altered the playing field against a bank shrouded in secrecy. A bank that benefits from globalization and diversification of assets around the world can no longer claim its customers are off limits and secret.

This UBS revelation is a seminal event in banking, the ability of a government to tax its citizens, and a warning shot across the bow of black marketeers. Sure, in the near term we will see the wealthy move their assets to the Bahamas, the Caymans and other banking safe havens. But with the worldwide banking mergers, and the staggering number of bank bailouts will increasingly put those banking safe havens on the radar for greater transparency and openness.

Air Force Gets Rid of the Internet

2009-02-19T12:48:00.002-05:00

According to Noah Shachtman at Danger Room, Air Force officials shut down the internet at Maxwell Air Force Base in Alabama after an specific and significant intrusion at the base that threatened the entire air force network. Noah notes that the DOD already limits its users from accessing anything on Myspace, Facebook, Youtube, or any other social networking site.

From my own experience they also limit a user's ability to get to a large number of blogs, and random websites with any video links embedded in them. It's pretty restrictive, but it largely doesn't matter, because most of the sites they restrict either take up too much bandwidth or just waste your productivity anyway (not counting the wasted time blogging).

According to my own RUMINT (rumour intelligence) of folks in the Pentagon, the senior leadership is extremely unhappy with the internet right now and DOD's capability of preventing viruses and network intrusions. Apparently, a senior leader on a foreign trip to the war zone came back with a massive virus on his personal laptop, and blew the roof when he found out. Other senior leadership already want to shut down the military's access to the outside world internet (meaning not the classified SIPRnet or the unclassified NIPRnet) because of the headaches caused by network intrusions and viruses. Obviously they cannot shut down the whole thing, but they sure can make it more restrictive and limit the troops ability to allow harmful things onto the DOD networks.

Let's Rid Ourselves of Ratings Agencies

2009-02-17T18:31:00.003-05:00

Robert Rosenkranz writes a persuasive article in the WSJ about the role of Rating Agencies in this current economic crisis.

Here are some key bits:

"Subprime mortgages (and all manner of other risky loans) held directly by financial institutions are questionable assets with high associated capital charges. Each one alone would deserve a "junk" rating. Structured finance simply piles such risky assets into bundles and slices the bundles into tranches. The rating agencies deemed some 85% of the tranches by value as AAA, and nearly 99% as investment grade -- thus turning dross into gold by a sort of ratings alchemy...

The problem was not the erroneous ratings per se; everyone misgauges risk and ratings agencies are no different. The problem is that these erroneous ratings were incorporated into law. Regulators should not have relied on ratings agencies to asses the risk of bond holdings. Instead, they should have relied on markets...

Rating agencies would continue to have a useful role. Their assessment of credit risk, and their marshalling of pertinent data, would help investors make their decisions. And whether issuers or bond buyers pay for their services, rating agencies will want their ratings to be as predictive as possible. They will still be the "Consumer Reports" of the bond markets, simply without the force of law behind their recommendations. Buyers of toasters can decide for themselves, and so can buyers of bonds. Our economy would be stronger for it."

I am a fan of eBay. I use it and find it extremely easy and transparent. Trust is the key to financial transactions, trust in that the seller is genuine and the product is without defect, and trust in the buyer that he/she has the money to pay for the product. eBay creates that transparency of trust even though I have never met or seen any of the people with which I have conducted transactions.

The reason for that is because of the easy to understand and completely transparent ratings process. Each individual can rate a seller or buyer on a 5-star scale and can write specifically what was right or wrong with the transaction. When I see a seller with 2,000 successful transactions (success being defined as the seller and the buyer were happy with the result) I know how much I can trust him or her. I am willing to pay now while I wait for the item in the mail with only a description of the object to satisfy.

Networked video games are also using this "trust" factor so gamers can demonstrate not only how good they are but how trustworthy they are not to cheat. P2P file sharing works basically the same way: do you provide quality music files or don't you. Reputation is becoming the biggest quality to look for on a network when evaluating whether to buy or sell a product, download a song, or even play a video game with someone.

Now imagine that each of these networks had one, or at most two, private for-profit businesses that determine the reputation of individuals or assets on that network. Individuals will not release all the relevant information, bribe those running the businesses with joint ventures or profit sharing, or just plain scam the business into providing a false value for their reputation. Unfortunately, that is exactly the situation we find ourselves in with how the financial industry operates. Moreover, the for-profit businesses asset ratings are used as the basis for legal requirements.

Our financial system needs to move beyond these antiquated ratings agencies. They are a relic of the 20th century when information was difficult to assemble and understand. Now they stand in the way of greater transparency and openness in the market. As Rosenkranz suggests, we should force the ratings agencies to become like "Consumer Reports" with no legal requirements to abide by their ratings.

Using P2P to Reduce Traffic

2009-02-17T18:19:00.002-05:00

Researchers at University of California, Irvine, are creating the Autonet, a network of vehicles using 802.11 technology to send and receive information about traffic patterns. They are creating such a program by adapting lessons learned from music and video peer-to-peer file sharing.

Technology using networks to help reduce traffic congestion is long overdue. Something to watch for in the next few years.

Washington Gathers Power to the Center

2009-02-17T17:53:00.001-05:00

Joel Kotkin writes an interesting op/ed a few weeks ago about the gathering power in Washington. The collapsing cities and regions abound across the US; New York City with its banking woes, the entire state of California is bankrupt, Detroit with its "zombie" auto companies, Miami with its real estate debacle, and even Charlotte with its own banking woes (BofA and Wachovia headquartered there).

The new game in town is power--power to dispense money, favors, and business bailouts. That kind of power can only come from Washington because it deals in politics. America has always had strong feelings about the threat of too much power, and even more so political power. As Kotkin notes, Alexis de Tocqueville said America's decentralized power structure and lack of a metropolis was "one of the first causes of the maintenance of Republican institutions."

Federalism was our unique path, only allowing enough power to gather in the center as was absolutely necessary. Federalism is based on the idea that those closest to the issues know better how to solve them. A government across the ocean does not know what its people in North America need, a central government does not know what the people in the states need, and the state governments do not know what local town residents need.

This evolution of Washington as the true center of power in our country (as opposed to the financial center in NYC or scientific/business center in Silicon Valley) reminds me of Atlas Shrugged. In that book, each new natural disaster, or more often the case economic disaster, "forced" the politicians in Washington to create solutions to save the engine of production they had not created in the first place. Washington produces nothing. It only takes, sometimes with the threat of incarceration or at the point of a gun. Washington's ascendance amidst bailouts, multiple "stimulus" bills, and government regulation reduces the tenuous balance of federalism and independent machinations of the market.

Remember, once power is gained, the person or institution is loathe to give it up. Go back and read the Federalist Papers. It will be the hardest book you ever read, but it will be worth it to find out how the Founders intended our new country to flourish.

Canada is Ready to Make Big Gains During Economic Downturn

2009-02-17T09:34:00.002-05:00

Fareed Zakaria has an interesting op/ed piece in Newsweek about the economic and immigration trends that make Canada a country to watch for real economic growth during this global crisis.

There are two interesting trends highlighted in this article. First, Canadian banks are "typically leveraged at 18 to 1—compared with U.S. banks at 26 to 1 and European banks at a frightening 61 to 1." When the credit crunch happened Canadian banks were in a less exposed position than their cousins to the south or across the pond. This difference has only to do with financial industry regulation, and not the underlying economic structure of any region or country. In other words, it's not that the Canadian economy is stronger than the US or European economy, it is that their banking regulations forced their banks to behave more soberly and cautiously. That growth may inhibit growth during boom times, but it insulates you during crunch times.

The second major trend identified in this article is the open door immigration policy of Canada. The US has fewer work visas and green cards than Canada according to Zakaria. There is the Canadian Skilled Work Visa that awards permanent residence in Canada even without a work sponsor based on a scoring system (education level, work experience, age and language abilities). You have to score a D+ or higher (67 points of 100) to be granted a skilled work visa. PhD's are worth 25 points. This is an awesome program, that will attract the best and the brightest from around the world. Zakaria is correct to berate our government for encouraging bright young students to come to our universities only to kick them out when the graduate and force them to move to Vancouver, Toronto, or Ottowa.

Attracting skilled workers, opening up more work visas and green cards, and generally encouraging movement of labor capital to the US would be the ultimate "stimulus" instead of the bull---- Congress and the President are spending now. A program like Canada's would not even cost any money beyond the administrative overhead, and it would encourage the most innovative, bright young people to stay or come to America, work and build here, pay taxes here, and contribute to the melting pot.

Instead of pursuing an incentive immigration system like this, the government slaps "Buy American" on steel prodcution in its "stimulus" bill. Do they even know what that means? I just read an article over the weekend that the Kremlin-directed oligarchs are considering bailing out an Oregon steel producer because steel prices are so low. With such increasing economic interconnectedness, the rise of sovereign wealth funds, China's growing investment in our economy, and the fact that a Toyota actually has more American made parts than a GM car, what does "Buy American" even mean any more. I truly wish someone could explain it to me. A steel company owner was on 60 Minutes over the weekend trying to explain why he lobbied Congress for the "Buy American" clause. I still don't understand what he was saying. He thinks free trade is an illusion, wants restrictions on imports, and subsidized steel prices. I certainly did not realize there were any guys like him left in the private sector.

Yes, I know that last paragraph was a tangent, but the 60 Minutes interview bothered me and I had to rant.

Using Science to Find Bin Laden

2009-02-17T09:07:00.003-05:00

Researchers at UCLA investigated where Osama Bin Laden may be hiding using "distance decay theory" and "island biographic theory" in combination with satellite imagery. Distance decay theory says that the odds are greater the person will be closer to where they were last seen. Island biographic theory says that locales with more resources (food, water, electricity, etc.) are likelier to draw "creatures of interest.

This study evolved from an undergraduate seminar on applying geographic profiling to real world problems. It looks like the mathematical techniques used in the show Numb3rs are being tought in universities, and even being applied to problems like finding bin Laden. We need more studies and approaches like this one.

This is the best quote from the article:

"The results, reported in the MIT International Review, are being greeted with polite but skeptical interest among people involved in the hunt for bin Laden, the al-Qaeda leader behind 9/11. Bin Laden's whereabouts are considered "one of the most important political questions of our time," the study notes."

Polite but skeptical. Did you get that? These are the people who have not been able to find bin Laden for eight years. Now they are greeting geographic profiling by academia, which has demonstrated its utility in tracking down criminals, with skepticism. At this point I would appreciate that people are still willing to contribute intellectual time to solving riddles like "where is bin Laden" given how unsuccessful this particular manhunt has been.

Hydrophobic Sand to the Rescue

2009-02-16T22:59:00.003-05:00

The problem with deserts is that the available water seeps through the ground too fast for the farmers to keep their crops alive. Therefore, they have to use irrigation and water their crops several times a day.

Scientists in the UAE and Germany have developed a nano-coating for sand that makes it hydrophobic, meaning it repels water or waterproof. (Article here) The idea is to put a few inch thick layer of this hydrophobic sand beneath the desert topsoil so that the water does not seep beneath the crop roots. Additionally the nano-augmented sand may limit the salts moving upwards to the roots, thus limiting the damage to the crops. The scientists already have a factory capable of producing 3,000 tons of this hydrophobic sand a day. My guess is that number will increase by a lot...and soon.

Nature throws up an obstacle while scientists and engineers figure out a way to knock it down. This hydrophobic sand could revolutionize North Africa and the Middle East from the barren wasteland to fertile areas capable of agriculture. Even if it does not, it could reduce the water usage for irrigation in a region desperate for water.

Picture of a Viral Coating

2009-02-16T22:54:00.003-05:00

Scientists have created a picture of the viral coating using high energy X-ray diffraction. This coating contains 5 million atoms....all captured in their picture.

Now that we have mapped the enemy it will only take time before scientists figure out a way to breakdown its defenses.

Link here

Book review of "Great Powers: America and the World After Bush" by Thomas P.M. Barnett

2009-02-16T16:52:00.005-05:00

Wow! Where to begin? In the spirit of a great man profiled in this book, Teddy Roosevelt, I will not criticize the man in the arena on style or substance like a typical book review, but merely reflect on some of the concepts and rule sets Barnett discusses.

This is a fantastic book on grand strategy, globalization, and America’s role in the 21st century. A non-fiction book’s rating in my library on LibraryThing.com is almost always determined by the number of underlined passages and comments in the margin. Needless to say, Great Powers rates five stars.

The protagonist of this book is the middle class; not the American middle class, but the emerging global middle class of three billion people. The emerging global middle class, with the additions of China and India, will drive the new rule sets on the next phase of globalization in areas of security, economics, the environment, and social issues. Instead of western government aid “push” we will experience the global middle class demand for resources and rule sets “pull.”

Barnett is an eternal optimist. Amidst constant doom-saying in the news, periodicals and books, Great Powers stands up with a positive view of the past up to this point and a grand strategy for how to make it even better. I would imagine Thomas Barnett is like the kid who got a pile of manure for Christmas one year and broke out in a wide grin before jumping in “because there has to be a pony in here somewhere.” He sees systemic perturbations as positive events (or at least as learning events) because they force you to rethink the rule-sets and standard operating procedures you have been living under. Whereas Nassim Taleb sees Black Swans as perturbations that can collapse the system (and to prepare accordingly), Barnett sees them as necessary discontinuities to allow the economic and political establishments the freedom to readjust their rule-sets. Earthquake in China? Rule sets on government corruption and standard building codes will be updated to deal with the disaster and public backlash. Russia invading Georgia? Rule-sets on Core power interventions in the Gap after Bush’s intervention in Iraq get updated and amended, and Russia is back on the radar as ally in fighting Islamic terrorism because of its demonstrated willingness to use force. Invasion of Iraq? Rule sets on globalization, connectivity, and stability extended into the heart of the Gap only to replicate itself and expand more.

This optimism is also reflected in his time frame of analysis. Instead of looking weeks, months, or years, he looks at trends over decades. Instead of seeing a few data points of growth or decline (re: Wall Street, oil prices, military interventions) over the course of a year or two to generate a conclusion, he extends the frame of analysis to decades and sometimes more. This allows him to place the current blip within the context of the overall growth or decline of the pattern he is discussing. When an analyst looks at the patterns of globalization and security over decades across the globe instead of years in one particular region or country, it is easy to see the incredible progress in economic and security terms justifying his optimism. And that is true pattern analysis. Ray Kurzweil says he is a “patternist” but I would apply that moniker to Barnett as well.

If you think this book is like the myriad of books out there bashing Bush and focusing on Iraq, Afghanistan, Katrina, or Gitmo, then you are in for a surprise. The first part of the book is indeed a harsh criticism of the Bush-Cheney years, but he moves on quickly to assert his vision of the economic, diplomatic, and security trends occurring across the globe. Instead of condemning the administration for getting into Iraq, the failed post-war planning, not having enough allies, etc. he discusses the failure of the meta-strategy of Bush-Cheney: not using the 9/11 system perturbation to rethink global rule-sets and create a new global security environment with a lot of new partners. He does give credit to the administration for encouraging China’s economic rise without resorting to great-power conflict over Taiwan as one of the big “dogs that didn’t bark.” This book is not so much about the failure of Bush-Cheney as it about the lost opportunity after 9/11 to reconceptualize the progress we have made to the progress we need to make.

The next part of the book discusses the new concepts and understanding that must occur to re-forge the American grand strategy we have been lacking. Globalization “comes with rules but not a ruler” and so the rules must be managed, extended, and improved. The nature of power has changed because so much of it is derived from networks and connectivity, and power within a network, even in a hub-and-spoke network, is not easily calculated nor exercised. Government efforts at strategic communication are a dead end because it is rooted in broadcast communications in a networked P2P world. The US government cannot keep funding the Leviathan force (mostly Navy/Air Force) while working the System Administration force (mostly Army/Marines) to death. Globalization brings networks which are gender-neutral, which will upset traditional societies by empowering women more than men. Fascinating concepts like these, while not new or particularly revolutionary, are woven into a wider strategic fabric with globalization as the main thread.

The next part of the book surveys American history through Barnett’s unique vision and grand strategy. I enjoyed this part of the book the most. Maybe because I love history and have always wondered how Barnett would interpret years and decades of trends in American history. Maybe because he exalts Teddy Roosevelt and Alexander Hamilton as true grand strategy visionaries in need of recognition for their contribution.

Barnett makes the case that the US is the “source-code DNA” for the globalization spreading across our networks. In three words this concept captures US history as the guide and the inspiration for globalization, and that any problems or issues we currently have can be analyzed by looking to our own frontier integration of the “Wild West.” I love this analogy because it combines the two great conceptual engines of our time: computers and biology. During the industrial revolution Newton’s mechanics were the guiding principle of thought across all the academic disciplines from science to philosophy to sociology. After Einstein, the world analyzed its trajectory and current existence with the fundamental physics of the atom, relativity, and space-time. With the discovery of DNA by Watson and Crick, and the rise of computers because of Turing and Von Neumann there have been competing conceptual frameworks for how to understand the world. Is the world one big interdependent living entity or is the universe actually a giant computer that “computes” reality. Neither conception has been able to completely dominate the other in academic or popular culture. Instead of taking one or the other as a tool of analysis, Barnett combines the two into “source-code DNA” that demonstrates his strategic imagination.

The biggest section of Great Powers analyzes the current trends in economics, diplomacy, security, and networks. The shear number of subjects Barnett covers is astonishing, forcing the reader to think about all the connections and linkages he makes and providing an outline for the reader to imagine many more. Here is a list of topics Barnett covers in some depth (off the top of my head, as I’m sure I missed a few): globalization, immigration, global warming, environmental issues, peak oil, resource wars, religious awakening, private sector investment flows, social networks, economic connectivity, centralization vs. decentralization, identity in the face of encroaching or competing values, unilateralism vs. multilateralism, great-power war, terrorism and insurgencies, food distribution, nuclear weapons and deterrence, and demographic trends in aging countries.

Great Powers is a physical demonstration of “War in the context of everything else,” a concept Barnett has advocated for as long as I have been reading his work. Instead of thinking of the war in Iraq or Afghanistan purely as a war to be won or lost, we must think of it in the context of everything else; meaning globalization, energy, economic interdependency, etc. This book truly places the current American wars in the Middle East in the context of everything else. Winning the long war means job creation. Victory will come in the boardrooms. And years later, when we see an advertisement in the NY Times to “Invest in Iraq” we will know we have won. That is what war in the context of everything else means. Great quote: “Feed stomachs and wallets first, then hearts and minds will follow. In this change process, globalization is both contagion and cure, acting as a volatile accelerant of freedom’s expansion around the world.”

Barnett goes into some detail about his work at Enterra Solutions, a strategic IT consulting company. I found his description of their work fascinating, if a bit too “markety” in its pitch (too many consultanty buzz words and even a mention of service-oriented architecture makes me cringe), because he is actually doing what he preaches. Instead of just talking about globalization, he creates global economic linkages through his day job. Instead of just talking about increasing the economic interdependency and “reducing the Gap,” he is working with the Kurds, Turkey, Lebanon, and the UAE in making their rule-sets more resilient. Instead of just talking about the evolution of military solutions to security solutions, he is making networks more resilient through the spread of financial and security rule-sets to Gap countries.

I love science and math. I see the patterns Barnett talks about as an extension of and practical realization of the concepts in complexity theory, complex adaptive systems, network theory, and fractal analysis. Since Mandelbrot’s discovery of fractals and the explosive growth in chaos theory and complexity theory (which are meta-theories of the universe that include fractals as a visual example of the underlying theory), the scientific and mathematical communities have developed greater understanding of natural occurring phenomena and a body of language to describe it. I would suggest to Barnett, his colleagues at Enterra Solutions, and a wider community of advocates (of which I am part) to study complexity theory and complex adaptive systems because they offer a framework, and more importantly, a language to describe the phenomena beyond the outdated language of international politics, economic liberalism, or balance of power game theory. In other words, when Barnett sees resilient food distribution networks, I see ant colonies. When Barnett sees economic interdependency, I see a tightly coupled ecological system of predator-prey relationships. When Barnett sees expanding rule sets to the “bottom billion” or “down the pyramid” I see a power law relationship where business expands along the Long Tail. The addition of a scientific/mathematical language to these powerful ideas of globalization and the emerging middle class will only help the their infiltration across a greater variety of networks.

In conclusion, Barnett’s vision for a renewed American grand strategy hits the nail squarely on the head during this economic rule-set transformation, new White House administration open to a greater vision beyond extricating itself from the mess Bush-Cheney caused, and the quickening pace of the demands of the emerging global middle class.

P.S. Here is a link to a recent Thomas Barnett article summarizing some of the concepts in Great Powers. I liked the title the best. j/k.

P.P.S I bought my copy of Great Powers on Amazon and so can you.

P.P.S. This is one of those books when you tell your high school history or social studies class, "I don't think you can handle this book, but I'm going to give it to you anyway. So pass it along to a friend if you can't handle it" knowing that by telling them they can't do it, they will force their way through it and be better thinkers for it.

Audit them all and let the IRS sort it out

2009-02-16T16:05:00.004-05:00

A new site clearly states what all of have been feeling recently:

"If you serve the public in a position of high responsibility, you deserve to submit to an IRS audit annually. If you lobby congress, hold a cabinet position, or serve any federally appointed position, feel free to get in line at the IRS. Consider it "table stakes" for establishing fiduciary credibility. We can't afford tax cheats as Congressman and Senators, nor as federal attorneys, prosecutors, or administrators.

James Madison, our beloved fourth President, a founding father, and by many considered not only to be the principle author of the Constitution but the “Father of the Constitution” is credited with the quote: "The truth is that all men having power ought to be mistrusted”. It is in the spirit of the founders, and in acknowledgment of the wisdom of James Madison and others, that we call for an annual financial audit by the IRS for specific men and women having power at our national level."

I wholeheartedly agree with this position. We need to bring back a level of credibility to the leadership class in this country. Our tax system is a voluntary one, and if people begin to lose faith in that system, it will break down.

The creators of this website are asking to "petition the government for a redress of grievances" as it clearly states in the First Amendment. They are advocating both short term and long term actions officials and the government could make. Here is the summary of grievances.

"First of all, a petition that is workable - is actionable. Something should happen as a result of the petition (or request if you prefer). Since government typically grinds along at a lethargic pace, we have to both ask for something that can be done now, and something that will be systematic and long lasting.

So the very first action requested is that those in high office to submit to our wishes and volunteer to be audited. This requires no legislation, and no party support. It is a decision of conscience for every individual official. Unless there is a severe tax violation, perhaps the other significant implication of this decision is how the Representative, Senator, or Official would be seen by their peers. Would they be seen as “breaking ranks” with those with whom they work? Talk about peer pressure! Can you imagine one official saying to another, "Representative X is making us all look bad with this tax audit thing!"

This brand of ironic and intense peer pressure advocates not standing out as “better than the other guy”. It’s a tragic commentary that those who have competed to be best, who have run campaigns showing why they are better qualified and able than the next guy, now might be willing to settle for mediocrity in financial accountability. But none the less, the first thing we can do is ask for them to comply, and to have the summary results of the audit released.

Second, there has to be a willingness on the part of the IRS to make the release. They don't do this now, so it's something new for them. That means that the Secretary of the Treasury, under direction from the President, must make an operational plan to support both the audit and the summary disclosure. Since the President is the Chief Executive, he sets the direction, and the Treasury must follow his mandate. So the second paragraph calls on the President to direct the Secretary of the Treasury to act.

Finally, the long term. It will take some time to put this idea on the legislative agenda and to drive it through to completion. There is absolutely no way that Congress will self impose this type of mandate unless they believe is is the lesser of two evils. The worst evil for a Representative or Senator (I’m sure this sounds pretty cynical, but it’s all too true) is to lose their seat. So our elected officials need to think that they either do this, or they are thrown out. What would make them believe that? Massive public outcry. A flood of letters to their offices and emails stating that they will not get a vote if they don’t undertake this initiative.

We ask the President to make this his initiative. To take a dose of this medicine, and lead, by volunteering himself for an audit. We then ask him to draft and submit to Congress legislation making this annual audit and disclosure process the law of the land. We call for the President not to give up."

Go to the petition website to put down your name as part of the movement to create some financial transparency at the highest levels of government. This is not a left- or right- initiative. Both sides have too much dirty laundry to mention. This effort is about getting the representatives we deserve, not the ones we have.

Cool Special Forces Gear

2009-02-12T23:10:00.003-05:00

This year's Special Operation/Low Intensity Conflict Conference had some pretty cool new inventions to help the soldiers on the ground in Iraq and Afghanistan.

There is an Unmanned Ground Vehicle (UGV) that carries heavy loads for soldiers over large terrain. The kicker is that it is programmed to follow the soldiers independently.

There is remotely operated gun-mount for vehicles, that are in common use today on the battlefield. The kicker is that the tracking mechanism allows the gunner to find a target and the gun automatically swivels to the correct position and can even fire 40mm grenades in an arc in order to hit the target.

Lastly, Marathon Robotics adapted Segways with GPS and laser navigation. The kicker is that when the Segways are outfitted with dummy human torsos and software they can be used for live-fire sniper practice and will automatically disperse or flee at the first shot.

Unbelievable innovation on the military technology front.

Tipping Point on Solar Power

2009-02-12T23:07:00.001-05:00

This story is great news. Hopefully it will be a tipping point in solar energy.

Network the Whole World

2009-02-12T22:22:00.001-05:00

I blogged a few days ago about a flash mob in London (here). An astute reader (h/t Patrick) showed me a link to an awesome website that takes Social Network Analysis (SNA) to a whole new level. If you thought 6 Degrees of Kevin Bacon was cool, this website gives users a typical SNA mapping tool to visualize over 35,000 individuals.

As their website says:

"The NNDB Mapper is a visual tool for exploring the connections between people in NNDB, linking them together through family relations, corporate boards, movies and TV, political alliances, and shadowy conspiracy groups. Maps can be saved and shared for others to explore."

This service and capability will grow, trust me. The cool visualization, combined with the non-intuitive linkages between people will interest thousands of people. All it takes is database information on connections and a fairly simple visualization tool. Imagine the possibilities for LinkedIn, Facebook, or any of the other social networking tools.

Soon we really be able to mathematically conclude whether everyone in the world is really only separated by only six degrees.....and we'll be able see it too.

Mathematicians Find Largest Number

2009-02-12T08:13:00.001-05:00

Iowahawk links to a crazy story coming out of the mathematics world.

"An international mathematics research team announced today that they had discovered a new integer that surpasses any previously known value "by a totally mindblowing shitload." Project director Yujin Xiao of Stanford University said the theoretical number, dubbed a "stimulus," could lead to breakthroughs in fields as diverse as astrophysics, quantum mechanics, and Chicago asphalt contracting.

The number itself is incomprehensible by human minds, and can only be theoretically understood in a fractional parallel universe which we refer to as the DC dimension," said Brossard. "The best way to understand a stimulus is to imagine a dollar sign followed by a packed string of hexidecimal nanodigits, wound into a triple helix, woven into a dodecahedron, and stacked on top of one another. Now imagine you were a black hole on the far edge of the universe, trying to escape the stimulus at 30 times the speed of light. The stimulus would still catch up to you and ram your black hole with such furious, repeated force that it would cause your entire reality itself to collapse.

"The exciting news is that with more powerful computers and drugs, we believe we are on the verge of discovering an even larger number, which we refer to as a 'stimulusconferencebill,'" said Xiao. "Speaker Pelosi has already promised us the funding."

How Do the Afghans Fight?

2009-02-11T13:16:00.003-05:00

This is a fantastic brief on the TTPs (Tactics, Techniques, and Procedures) of the Afghan enemy our Marines are facing in southern Afghanistan. Michael Yon must have received permission to publish this unclassified brief. It is clear, concise, and sobering in its description of the enemy.

The enemy's discipline, fire control, selectivity in ambush, deadly ambushes with overlapping fields of fire with multiple combat arms (guns, RPGs, rockets), is quite different than the enemy our soldiers and marines faced in Iraq. As the author of the brief states, these people have been fighting continuously for the past 30-40 years in the one of the most inhospitable pieces of terrrain on the face of the planet.

Read through this brief and remember it as you see various political positions supported or discussed on the way ahead in Afghanistan.

Bailing Out States

2009-02-11T09:27:00.003-05:00

Part of the Congressional proposal to "stimuluate" the economy is money to pay off the debts individual states accrued because they cannot balance their budgets. The last I heard the total amount that will go directly to state governments is around $50 billion, but who knows now because this process lacks so much transparency.

California is has a budget tens of billions of dollars over their actual revenue, hence the policy of sending government workers home with unpaid leave one day (or maybe its two) a month. New York cannot balance its budget either so it will be bailed out by the federal government too.

The strategy of bailing out individual states has "peril ahead" and "danger" written all over it.

First, it rewards state governments for overspending. Governments that cut spending, government services, numbers government personnel, and other measures to maintain a balanced budget see other states that overspent, hired too many people, and increased government services receive federal money to support those programs. By bailing out state governments the federal government will inadvertently incentivize state government overspending.

Second, bailing out state governments only transfers the problem of too much debt from state residents to the entire tax paying citizenry. The bailout does not solve the addicts problem. It only buys you a few months or even years. However, buying time for the state governments to recuce spending or increase taxes combined with incentivizing overspending does not equal a solution from my perspective.

Third, what is the difference between California's budget deficit and the United States government budget deficit? The ability to print money. Both governments sell bonds. Both governments run deficit spending because they do not take in enough money to pay for all the services they provide. Both governments tax the citizens within their borders. The only difference that I can tell between the behavior of California versus that of the federal government is that California's current position up the creek without a paddle is because they do not have the ability to print money (inflation, market liquidity, interest rates) that the federal government has. Bailing out the state governments for overspending and not balancing their budgets essentially provides them the ability to print money. All that is required is to demonstrate that the state government budget is in need and the federal government will print/borrow money and distribute it to the state.

Fourth, what about the sovereignty of each state's National Guard. I have not heard anyone on television or the internet talking about this issue. The National Guard is owned by each state governor. They can be called up by the federal government in times of emergency like war or insurrection, but their ownership still resides with the governor. With the states pursuing a strategy that the federal government is paying their budget deficits, does the federal government have greater claim and ownership of the National Guard forces to do with as it pleases? I don't know the answer or understand the legal details surrounding the National Guard, but I can imagine the argument a federal government lawyer would make: without federal assistance the state could not be able to sustain or equip its National Guard as part of its state budget, therefore, the federal government ought to have more "input" into how those forces are used or deployed. An interesting consequence of federal bailouts on states rights and the use of state military forces.

Why Stimulus Won't Work

2009-02-11T09:12:00.002-05:00

Paul Mirengoff, on the blog Powerline, cites an argument made by John Cogan of the Hoover Institution why the stimulus bill will not work.

The assumption for this argument is "that the way government policy can help stimulate the economy is by causing unproductive resources (e.g., a worker or inventory) to be put into productive use."

--20%: Tax cuts
--30%: Unemployment benefits & health insurance
--20%: Education
--20%: Public Works, 10% of this number (2% of the total) will be spent this year
(yes, I realize the percentages only add up to 90%, which is why we are talking rough numbers.)

The argument is that tax cuts, unemployment benefits, education, and public works projects several years down the road do not turn current unproductive resources into productive use. Only 2% of the total bill will could be argued to turn unproductive resources into productive ones by building infrastructure immediately.

Thus, even if the economy improves, it will not be because of the stimulus bill but in spite of it.