Relevant and even prescient commentary on news, politics and the economy.

Two Thoughts

1. When a president reads in a speech that he’s about to given that a hostile state is actively seeking to a acquire uranium, wouldn’t he normally ask questions like “Is this information reliable? Was Saddam successful? How worried should we be?”, and so forth. Since the Office of the Vice President, the CIA, the State Department, and the National Security Council all knew the information was bogus, it’s hard to see how top presidential advisors and the president himself could not also know. I suppose that if instead of asking about the reliability of the frightening allegation, the president simply said “Uranium from Africa? Neat,” then the president’s staff might not have asked the right people the right questions—and that’s also scary.

2. By what magical (or for that matter, constitutional) power is the CIA able to force the president to alter the State of the Union speech? The CIA has no domestic powers, other than the ability to give information and advice, not orders. The CIA told the speechwriters that there was no real basis to say that “Iraq tried to buy uranium from Niger”; the speechwriters came back and said, “but the British said that they tried to do so.” The CIA apparently relented and said “it’s true that the British said that, but they were wrong”. Speechwriters: “But they said it.” Am I making this up? It’s hard to read the last paragraph of Tenet’s statement any other way:

Portions of the State of the Union speech draft came to the CIA for comment shortly before the speech was given. Various parts were shared with cognizant elements of the Agency for review. Although the documents related to the alleged Niger-Iraqi uranium deal had not yet been determined to be forgeries, [CIA] officials who were reviewing the draft remarks on uranium raised several concerns about the fragmentary nature of the intelligence with National Security Council colleagues. Some of the language was changed. From what we know now, Agency officials in the end concurred that the text in the speech was factually correct – i.e. that the British government report said that Iraq sought uranium from Africa. This should not have been the test for clearing a presidential address

The NSC, headed by Condoleeza Rice, is the agency with direct responsibility to the president for intelligence and security issues. It’s right there on their web page, which is a subpage of the the White House web page, www.whitehouse.gov/nsc:

The National Security Council is chaired by the President. Its regular attendees (both statutory and non-statutory) are the Vice President, the Secretary of State, the Secretary of the Treasury, the Secretary of Defense, and the Assistant to the President for National Security Affairs. The Chairman of the Joint Chiefs of Staff is the statutory military advisor to the Council, and the Director of Central Intelligence is the intelligence advisor…The National Security Council is the President’s principal forum for considering national security and foreign policy matters with his senior national security advisors and cabinet officials.

The CIA advises the NSC, which is the President’s national security forum. Shifting the blame to the CIA, when the CIA told the NSC that the information was questionable, should not work. Now, if Rice issued a statement similar to Tenet’s, then she might make a legitimate scapegoat. Although she wouldn’t really be a scapegoat because, she has the direct responsibility for ensuring the accuracy of the president’s intelligence.

AB

UPDATE: RonK at Kos has some other good reasons why the Blame-Tenet gambit shouldn’t work. See also CalPundit here.

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Recession Redefinition

Amidst all the Niger Uranium furor I almost missed some interesting economic news. Fortunately, commenter Stirling Newberry alerted me to a story in the Friday Washington Post: Number Crunchers vs. Recession. Said number crunchers are members of the National Bureau of Economic Research (NBER) which, among many other things, is the most widely used source for dating the start and end of recessions. You’ve probably heard that the latest recession started in March of 2001 (notwithstanding Bush’s simultaneous attempts to say that 9/11 caused the recession and that it started under Clinton–on this topic, this Slate story is a must-read). But when, if ever, did the recession end? Well, there are two conceivable ways to get to the end zone in football. Normally a team scores by moving the ball past the goal line. On the other hand, they could keep the ball stationary and simply move the goal line. It looks like the NBER is doing the latter:

“If the committee were to rely on the same indicator to date the end of the slump, the recession would already have lasted for two years and three months, making it the longest since the vastly more serious downturn that began in 1929 and became the Great Depression…

Chances are, by giving far more weight to the GDP than it has in the past, the committee will decide before long to call an end to the 2001 recession, which many economists believe ended late that year…

This is the dating committee’s [new] official definition of a recession:

A recession is a significant decline in activity spread across the economy, lasting more than a few months, visible in industrial production, employment, real income and wholesale-retail sales. A recession begins just after the economy reaches a peak of activity and ends as the economy reaches its trough

…But that language was sharply revised when the next update was posted last month on the National Bureau of Economic Research’s Web site:

The committee views real GDP as the single best measure of aggregate economic activity. In determining whether a recession has occurred and in identifying the approximate dates of the peak and the trough, the committee therefore places considerable weight on the estimate of real GDP issued by the Bureau of Economic Analysis of the U.S. Department of Commerce.”

My first thought upon reading this was “Hey, the NBER has the top economists in the country and is largely apolitical, so there’s not much of a story here.” My second thought was “On the other hand, the current President of the NBER is Marty Feldstein, who was Chairman of Reagan’s Council of Economic Advisers from 1982-1984. It sure would be nice for Republicans if the Recession is formally announced to be over before November, 2004.”

So I checked into who is on the NBER’s Business Cycle Dating Committee:

Robert Hall (Chair), Martin Feldstein (President, NBER), Jeffrey Frankel, Robert Gordon, Christina Romer, David Romer, and Victor Zarnowitz.

All members are top-notch economists, but I don’t know most of their political affiliations. Fortunately, many economists on both the Left and Right recently decided to reveal their political leanings by signing one of two letters (I blogged about the letters here). Besides Feldstein, no members of the NBER dating committee signed the Republican Letter (scroll down). Frankel, Gordon, and both Romers signed the Anti-Tax Cut Letter. So I think it’s pretty tough to argue that the committee was stacked with Republican economists. Also, Prof. Frankel chaired Clinton’s CEA in the late 1990s.

Instead, the change most likely reflects genuine confusion induced by the historically unusual confluence of positive GDP and income growth accompanied by rising unemployment.

Still, while probably not politically motivated the focus on real GDP as the single best measure of aggregate economic activity” is troubling because it implies a focus only on the total income in the economy, not the distribution of that income. Under this logic a recession would not be in progress even at 20% unemployment, as long as the other 80% of the labor force had more-than-offsetting increases in income. But at least one in five people in this scenario would disagree with this conclusion.

AB

P.S. In the 1970s, economists thought recessions and inflation would not happen at the same time, so they had to come up with a new name for the new phenomenon: “stagflation”. The only phrase I’ve heard for the current situation is “jobless recovery”, but while acccurate, it’s not very catchy. Ideas?

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Yellowcake Hits the Fan

Going back to the initial admission that the State of the Union information was incorrect, I speculated that a vaguely phrased statement would only ignite more press scrutiny. Recall the initial statement, as described in the NYT:

White House officials issued a statement in Mr. Fleischer’s name that made clear that they no longer stood behind Mr. Bush’s statement.

How Mr. Bush’s statement made it into last January’s State of the Union address is still unclear. No one involved in drafting the speech will say who put the phrase in, or whether it was drawn from the classified intelligence estimate.

It’s starting to look like I was right and Rove made, or allowed to be made, a rare but major PR miscalculation. Today, Colin Powell joined in the mess and didn’t help matters for the administration; see NYT, CalPundit, Likely Story, and Josh Marshall.

And while yesterday’s Capitol Hill Blue Story was a hoax, CBS’s story today with the headline Bush Knew Iraq Info Was False is almost as bad–and a lot more credible:

But the bottom line is the White House knowingly included in a presidential address information its own CIA had explicitly warned might not be true.

But, this is surely true: during the time that the false information was knowingly placed in the State of the Union speech and throughout the following period in which misleading stories were disseminated, no one in the administration was on the giving or receiving end of oral sex. Go about your business.

AB

UPDATE: CBS changed the headline to “CIA Takes Blame For WMD Flap”.

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Programming Update

When you change your story after the fact, contradictions and inconsistencies are likely to emerge. Earlier, I pointed out a few in Tony Blair’s testimony before the House of Commons. Today, Rumsfeld said this:

“The coalition did not act in Iraq because we had discovered dramatic new evidence of Iraq’s pursuit [of weapons of mass destruction]. We acted because we saw the evidence in a dramatic new light — through the prism of our experience on 9-11.”

I instantly thought that was an outrageous statement, but I didn’t realize quite how much so until Rick in Davis pointed it out. Rick is co-blogger of at The Likely Story, a new blog that you should definitely check out.

Rick notes that on May 6th, Bush first appended “Program” to “Weapons of Mass Destruction” (see my posts here and here), saying

“I’m not surprised if we begin to uncover the weapons program of Saddam Hussein — because he had a weapons program.”

But, as Rick notes, either they merely saw existing weapons in a new light (Rumsfeld) or Iraq had actual programs to produce new weapons (Bush). What to conclude from this contradiction about Rumsfeld’s opinion of Bush’s position? Go read Rick’s entire post.

AB

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The Sky is Blue

It’s been a week of pronouncement that the sky is blue:

  • On Monday, MSNBC noticed that noted jackass Michael Savage is a blithering homophobic (and xenophobic) idiot. Of the firing, MSNBC cable spokesman Jeremy Gaines said, “His [homophobic] comments were extremely inappropriate and the decision was an easy one.”
  • On Tuesday, the White House issued a statement that “Knowing all that we know now, the reference to Iraq’s attempt to acquire uranium from Africa should not have been included in the State of the Union speech.”
  • Today, the AP reports on a national assessment showing that 12th graders can’t write well: “…about half of seniors, within a 25-minute time limit, could not provide an organized answer that showed they understand their task and their audience. “

To be announced tomorrow: Ice melts when heated!, The elderly die at a greater rate than the young!, and Republicans consistently finance spending with deficits!

AB

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Potions of Mass Destruction

In Iraq, attempting to combine these ingredients thusly consitutes a Weapons of Mass Destruction ProgramTM:

A woman has set her Madrid home on fire while cooking up a potion in an attempt to imitate the fictional wizard Harry Potter (news – web sites), emergency services say….For want of more magical ingredients, the woman cooked up a potion of water, oil, alcohol and toothpaste, local media reported on Wednesday. It was unclear what spell she was trying to weave.

AB

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Uranium Hoax Hoax

The Capitol Hill Blue story cited below is a hoax–Capitol Hill Blue founder Doug Thompson now alleges that he was intentionally deceived by someone pretending to be Terry Wilkinson for the last 20 years (Thompson: “Erasing the stories doesn’t erase the fact that we ran articles containing information that, given the source, was probably inaccurate. And it doesn’t erase the sad fact that my own arrogance allowed me to be conned”).

Fortunately, I didn’t put too much emphasis on it at the time, pointing out that the paper has an odd motto and tabloid stories on the front page, and warning “So don’t get too excited about this story”. I guess that every story containing the words “Niger”, “Uranium”, and “Iraq” should be viewed very skeptically.

AB

P.S. In fact, I’m now so suspicious of outlandish tales of nefarious Republican plots that I’ll think twice before linking to stories like this one (slashdot discussion here) in the future.

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There’s That Word Again

QUESTION: Do you still believe they were trying to buy nuclear materials in Africa?

BUSH: Right now?

QUESTION: No, were they? The statement you made…

BUSH: One thing is for certain, he’s not trying to buy anything right now. If he’s alive, he’s on the run. And that’s to the benefit of the Iraqi people. But, look, I am confident that Saddam Hussein had a weapons of mass destruction program. In 1991, I will remind you, we underestimated how close he was to having a nuclear weapon. Imagine a world in which this tyrant had a nuclear weapon. In 1998, my predecessor raided Iraq, based upon the very same intelligence. And in 2003, after the world had demanded he disarm, we decided to disarm him. And I’m convinced the world is a much more peaceful and secure place as a result of the actions.

A few non sequiturs followed by an exaggeration.

I suppose the world did demand that Saddam disarm, as expressed by UN resolutions. But Bush’s statement seems to imply that the world demanded a US invasion.

AB

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