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

Eating a metaphore

LA Times carries an article about the beloved Twinkie. The Twinkie plant that used to smell wonderful as traffic passed, but has been replaced by Nordstrom and Nieman Marcus and condos on top floors, forced to move to Maine, and now only assembled in the US. Ouch!

Although eight of the ingredients in the beloved little snack cake come from domestic corn and three from soybeans, there are others — including thiamine mononitrate — that come from petroleum. Chinese petroleum. Chinese refineries and Chinese factories. And there are other unexpected ingredients that are much harder to trace. So much for the great “All-American” snack food.

When you bite into a Twinkie, you are chewing on an international nexus of suppliers. Most of our processed foods — salad dressing, ice cream, meal-replacement drinks — are processed with foreign additives: essential ones, like B vitamins for fortifying flour and the preservative sorbic acid, as well as Malaysian or Indonesian palm oil products, European wheat gluten, Peruvian colorants, Chadian gums and Swiss niacin, made from Swiss water, Swiss air (nitrogen) and North Atlantic or Middle Eastern oil. It’s a nice contrast to recall that Champagne comes only from Champagne, France.

Like many other industries, food additives have been off-shored. No major domestic vitamin or sorbic acid manufacturers remain in the U.S. Our last vitamin C plant closed in 2005 — in fact, it closed as I was speaking to an employee about a tour — and most of our artificial colors and flavors come from abroad as well. Our chemical industry is rapidly dismantling its expensive domestic plants and either forming joint ventures with Chinese companies or simply buying chemicals from them. This leads to lower food and pharmaceutical prices, but perhaps at the cost of quality control.

How can you have quality control when you don’t even know where the ingredient is coming from? During my Twinkie research, I was particularly surprised that many American food additive “manufacturers” buy chemicals, especially vitamins, from distributors and do not know, or don’t ask, where they come from. The distributors usually sing the same song, as they often buy from importers, and the importers buy from exporters who — no surprise — are often not able or willing to identify all of their sources.

Even purses run $500 – 1500 at the new mall.

Update: The above post is a real story. The transfigured mall was just recently opened, although the condos on top are not finished yet. They are sold out, however. The twinkie factory moved to a newer plant in Maine, where less rent is required.

Spelling was corrected.

The economics of Twinkie production can be found here care of Greg Mankiw, Chapter 13, Harcourt Brace and Co., 1998.

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Drought…gets no respect

The drought monitor is a map over time of drought conditions in the US.

The towns of Braintree, Hull, and others have declared water emergencies for use of water in the home (not the silly emergencies around lawn watering), declaring that they have only a three month supply in their resevoirs. Notice on the map our drought conditions in MA are only D-3 overall (severe).

Notice the Lakes area, and the Southwest as well of course the Southeast as advertized nationally. California fires have overshadowed the more important long range issue of drought for agriculture and hydrological crisis.

There have been posts on water, but mainly from city folk. Any farm or ranch people out there as well?


Historical data to last century

Historical data by riverbasin

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Who is more evolved, conservatives or progressives?

Learning myths, and evolution were mentioned in earlier posts. I thought I would post some information on the variety of approaches to these subjects about people and
personality traits.

The study of personality includes multiple approaches to the question of who we are and how and why we are similar and different to other indivduals. Some of the ways in which we study personality are developing descriptive taxonomies of individual differences. These approaches use basic psychometric and assessment techniques developed for the study of personality and ability. These approaches emphasize the “who” question of how people are similar to and yet differ from each other.
At least five different theoretical approaches address the “why” question. That is, why are there individual differences. Evolutionary Psychology emphasizes universals of human behavior and attempts to explain individual variability in terms of alternative adaptive strategies. Behavior genetic approaches analyze the variation in behavior in terms of the complex interplay between genetic and environmental influences. Systematic work in biological theorizing has emphasized the continuity of behavior across species and searches for the biological underpinnings of temperament and complex behavior. Social cognitive theories emphasize the importance of socialization and the effect of cognitive processes to create one’s unique patterning of behavior. Traditional psychoanalytic techniques, although not a major area of current personality theory, did have an influence in the theories developed throughout much of the 20th century.
The following selections from each of these approaches are meant to lead the interested reader to some of the current literature. These are certainly not meant to be a complete selection, but are rather important readings that provide good overviews of the separate approaches. The interested reader is encouraged to first consult the overviews of personality before delving into these more specialized readings.
Some of the most interesting results of the past decade have been the demonstrations of the moderate to strong heritability of personality and ability. Using techniques of quantititative behavior genetics, it has become commonplace to show that roughly 40-60% of the variation in most personality traits have a genetic base. The most exciting and counter-intuitive findings have been that the shared environment is much less important than previously thought but that the unique environment is very important.

Not economics, but perhaps related to rational choices and preferences.

Update: The above is mainly for informational purposes. However….

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Fires and Al Quaeda

Hat tip to Thinkprogress for the transcript of a comment on Fox News about the California fires.

DOOCY: You’re looking live at pictures from San Diego — Santiago, CA, where the wildfires continue. We were talking earlier in today’s telecast with Adam Housley and apparently police officers in a hovering helicopter saw a guy starting one of these fires. And Allison Allison Camerota, an FBI memo from late in June of this year is popping up this morning and it is ominous.

CAMEROTA: This actually has happened for many years in the past as well. An FBI sent out to local law-enforcement said that an al Qaeda detainee had given them some information that the next wave of terrorism could be in the form of setting wild fires. Adam Housley said lots of people on his block were asking him about it. Obviously this is something the FBI has looked into. They will continue to investigate it.

CARLSON: If they have this person in custody it probably won’t take long to be able to develop a link if there is one.

KILMEADE: A June 25 memo from the FBI’s Denver offices reported three days ago, excuse me, five days ago, by the Arizona Republic, that is a newspaper, they have been carrying the story and they continue to expand upon it.

DOOCY: Brian, the plot they say, according to this detainee, and they don’t know if the detainee is telling the truth. The plot was to set three or four wildfires. But they don’t mention California. They mention Colorado, Montana, Utah, and Wyoming. We do know for a fact that a number of the fires in southern California are of a suspicious nature and they are investigating arson.

I bet no one thought I could connect the two!

Actually, whether right or wrong, smart creative terrorists could cause havoc when required. Name some weak points not in the news. The tunnel collision linking N and S California highway systems. Computers in Utah funneling airport traffic data to coordinate national air traffic. Others?

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Busting myths right and left

The Washington Post reports:

The federal Centers for Disease Control and Prevention recently issued a flier to combat myths about the flu vaccine. It recited various commonly held views and labeled them either “true” or “false.” Among those identified as false were statements such as “The side effects are worse than the flu” and “Only older people need flu vaccine.”

When University of Michigan social psychologist Norbert Schwarz had volunteers read the CDC flier, however, he found that within 30 minutes, older people misremembered 28 percent of the false statements as true. Three days later, they remembered 40 percent of the myths as factual.

Younger people did better at first, but three days later they made as many errors as older people did after 30 minutes. Most troubling was that people of all ages now felt that the source of their false beliefs was the respected CDC.

The psychological insights yielded by the research, which has been confirmed in a number of peer-reviewed laboratory experiments, have broad implications for public policy. The conventional response to myths and urban legends is to counter bad information with accurate information. But the new psychological studies show that denials and clarifications, for all their intuitive appeal, can paradoxically contribute to the resiliency of popular myths.

This phenomenon may help explain why large numbers of Americans incorrectly think that Saddam Hussein was directly involved in planning the Sept 11, 2001, terrorist attacks, and that most of the Sept. 11 hijackers were Iraqi. While these beliefs likely arose because Bush administration officials have repeatedly tried to connect Iraq with Sept. 11, the experiments suggest that intelligence reports and other efforts to debunk this account may in fact help keep it alive.

I have not much to add at the moment, running late. Something to keep in mind, and truth cuts three ways most of the time.

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Boring and humdrum

Earth Talk suggests a boring alternative to running headlong into “green” sales.

Dear EarthTalk: Short of buying a new hybrid or other “green” car, are there ways I can make my existing vehicle more eco-friendly? I bought my car recently and am not quite ready to give it up.

Choice of vehicle may well be the biggest factor in determining the environmental impact of your automobile-based travels. But a considerable amount of energy is used—and pollutants emitted—in the production of any new vehicle, including hybrids and other more fuel-efficient options. As a result, many environmentalists believe that practicing good driving habits and performing adequate maintenance on an older car are probably better options for the environment than causing the production of a new vehicle.

According to the website, there are many ways to green up one’s driving habits. Obeying speed limits, utilizing cruise control and avoiding jackrabbit starts will maximize fuel economy and minimize tailpipe emissions while also preventing unnecessary wear-and-tear. Staying off roads during rush hours is also advisable, as stop-and-go driving burns excess gasoline and promotes smog. Opening vents and windows to cool off instead of using the air conditioner, an inherently inefficient appliance that consumes more fuel and leads to more emissions, is also good advice.

Drivers can also help minimize their environmental impact by keeping their cars well maintained. According to, getting regular tune-ups—where a qualified mechanic changes fluids and checks for and corrects problems such as worn spark plugs, under inflated tires, dragging brakes, misaligned wheels and clogged filters—can significantly improve fuel economy and minimize harmful emissions. also recommends seeking out low-rolling-resistance (LRR) replacement tires, which are specifically designed to improve a vehicle’s fuel economy, when the original ones wear out.

How would an entrepreneur sell this idea and make it sexier? And how would one make money from it?

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China and Bear Stearns

Business Wire reports:

NEW YORK & BEIJING–(BUSINESS WIRE)—-The Bear Stearns Companies Inc. (NYSE:BSC) and CITIC Securities Co., Limited (SSE:600030), with unanimous approval from their respective Boards of Directors, today announced an agreement in principle to establish a comprehensive strategic alliance. This alliance will include sharing management expertise and technology to develop new capital markets products and businesses in China, establishing an exclusive joint venture combining the existing businesses of both companies in the rest of Asia, and cross-investments of approximately $1 billion in each firm by the other. The alliance will bring together Bear Stearns’ capital markets expertise globally and market leading analytics with CITIC Securities’ vast resources and extensive business network to better serve clients worldwide.

The joint venture will provide a wide range of capital markets services, including cross-border mergers and acquisitions advisory, international equity and fixed income capital markets with a particular focus on international offerings of Chinese companies, venture capital and private equity, asset management, and equity and fixed income services. The joint venture will serve as a conduit for international companies seeking access to Asian capital markets and for Chinese entrepreneurs, corporations and state-owned enterprises looking to access capital or invest outside of the region.

As you know I have picked on the stock price of Bear Stearns as a barometer of who gets punished in the derivative markets, fair or not.

Is this venture a successful rebound of the market, or something else? Not knowing the specifics makes an answer purely conjectural, but I do wonder if Bear Strearns learned anything from the loss of two of its funds, or whether this merely lets them go global and sovereign?

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Farm Bill and WTO GATS Part 2

The NYT reports:

The World Trade Organization made a last-ditch effort on Tuesday to salvage stalled global trade talks by asking the United States and Europe to lower their barriers to farm imports in return for greater export access to India, Brazil and other developing countries.

Pascal Lamy, director general of the World Trade Organization, said the group was trying to goad negotiators into making some compromises.
A long proposal laying out possible compromises by 150 countries involved in the talks was issued at the World Trade Organization’s headquarters in Geneva. Officials said the draft was aimed at breaking a deadlock on issues that have eluded compromise since last summer.
Pascal Lamy, director general of the trade group, said the goal was to goad negotiators by laying out ambitious compromises they had been unwilling to make, in part because they did not see compromises by others. He said it would not be clear until September whether the new proposals would accomplish that goal.
The proposal was careful not to assign blame, but it also said time was running out on the possibility of a global trade deal. It was generally acknowledged to be a final attempt to save the talks, with the expectation that they would be declared a failure if it did not succeed.

NYT reports on complaints issued by Brazil about US farm subsidies, especially commodities.

The stalled talks are emphasizing a deeper issue: In some ways, the balance of power between advanced and developing countries is shifting, politicians outside the West, including Mr. Nath, say. “The reality is that there is a new economic architecture,” Mr. Nath said in an interview this week in his New Delhi office. “This new economic architecture is going to have new windows and new doors. It can’t be wished away.”
India and Brazil are refusing to open their markets further to goods from Western countries without a substantial reduction in subsidies provided to Western farmers.
On Thursday, Brazil filed a complaint with the W.T.O. about American farm subsidies. “This complaint attacks the entire U.S. farming policy,” Donizeti Beraldo, head of trade and international affairs at Brazil’s National Agriculture Confederation, was quoted by Bloomberg News as saying. Then, referring to the trade talks, Mr. Beraldo added, “If the U.S. fails to advance on talks, they will be at risk of more complaints.”
W.T.O. members are preparing for what is expected to be a decisive round of negotiations at the group’s headquarters in Geneva. On Monday, the presiding officers will release draft agreements that could form the basis of a compromise or, depending on the view of countries like India, give a firm indication that the current round of trade talks begun in 2001 is on its last legs.
Mr. Nath, whose office includes a shelf of thick W.T.O.-related publications, was quick to brush off questions about his flexibility, but still left no room for compromise.

The issue is not flexibility, he said: “It is removal of subsidies, which are a distortion of global trade…”

India and Brazil are asking the United States to reduce the estimated $22 billion in subsidies that it allots to farmers, and the European Union to trim its farm aid from 55 billion euros ($75.8 billion), saying the subsidies keep food prices on world markets artificially low and make it difficult for farmers from developing countries to compete.
Advanced industrial nations would like to see a substantial reduction in the taxes on exports to countries like India and Brazil to give their manufacturers access to those fast-growing economies.
Mr. Nath said he is seeking some understanding from the United States. Despite the growth of outsourcing and high-technology jobs in India in recent years, agriculture still supports about two-thirds of the country’s citizens.

India is in the midst of an economic boom that has driven up stock market indexes, wages and real estate prices to near record highs. Still, Mr. Nath was quick to distance the country from developed- nation economies.
India “is so far away from the United States and the European Union,” he said.
“We have 300 million people that live on $1 a day…”

Mr. Nath’s hard line in the W.T.O. talks was in marked contrast to his three-year stretch as commerce minister. There, his tenure has been characterized by an increasing openness to foreign investment and partnership at home. He has sometimes faced criticism that he is too business-friendly. (italics are mine)

Add the gambling issue that is being backed by the EU. Changes and more. Tariffs are not the answer.

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Foriegners in the US military since year 2000

This article adds a bit more information about who is fighting for the US as well:

More than 30,000 foreign troops are enlisted in the US Army, many of them serving in Iraq. Their reward for risking their lives for their adopted country is US citizenship.

They may have different reasons for joining the US Armed Forces, but all three are now among the more than 30,000 foreign soldiers fighting for America — not as Americans, but as a Mexican, a Portuguese and even a German. Without its foreign soldiers, the United States would have trouble coming up with enough troops to meet the demand in Iraq. The foreigners, for their part, take the dangerous job mainly for its biggest reward: US citizenship.

Since Sept. 11, 2001, the United States has granted US citizenship to 32,500 foreign soldiers. In July 2002, US President George W. Bush issued an executive order to expand existing legislation to offer a fast track to citizenship to foreigners who agree to fight for the US Armed Forces. About 8,000 non-Americans have joined the US military every year since then.
The foreigners already represent 5 percent of all recruits…

With stop-loss orders being re-issued and some bonuses for ‘hard to find’ specialties (officers) at $35,000, where are we headed?

Boston Globereports this:

A recent change in US law, however, gave the Pentagon authority to bring immigrants to the United States if it determines it is vital to national security. So far, the Pentagon has not taken advantage of it, but the calls are growing to take use the new authority.
Indeed, some top military thinkers believe the United States should go as far as targeting foreigners in their native countries.

“It’s a little dramatic,” said Michael O’Hanlon , a military specialist at the nonpartisan Brookings Institution and another supporter of the proposal. “But if you don’t get some new idea how to do this, we will not be able to achieve an increase” in the size of the armed forces.”

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Progress on right to know about sewerage!!

Right to know hearings for contamination of local water resources.

Dr. Summers, from the Maryland Department of Environment, explained how Maryland’s strong monitoring and notification requirements had helped quantify problems and were greatly appreciated by many utilities as it allowed them to explain and justify why more investment is required. Stuart Whitford, from the Kitsap County Health Department explained his support of H.R. 2452 by telling a scary story about a sewage spill that went on for two years before anyone realized what was going on (and after 4.8 million gallons of sewage was spilled!).
Microbiologist Erin Lipp did a great job of explaining how potent just a little bit of raw sewage can be and that the illnesses from sewage are vastly underreported.
Finally, even Kevin Schafer, the representative for the wastewater treatment community supported the monitoring and notification, but just wanted to make sure that details were spelled out and that the requirements were not too costly.

Sewerage is a water resource is a previous posting buy rdan.

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