Monday, June 16, 2014

ISIS pushes the religious war into a new stage

With I.S.I.S., the Islamic State of Iraq and Syria, boldly and brutally conquering parts of northern Iraq, liberals are blaming Bush and conservatives are blaming Obama for the collapse of the Iraqi government.  Both are right, and both are wrong, as far as I can tell.

It is right to blame Bush because it was he who destroyed the Sunni Baath party as part of his invasion of Iraq. It was he who put the Shiite Maliki into the power to rule Iraq (who turned out to be an avid leader in the tyranny and oppression of the Sunnis). It was he who deluded himself into believing that a pluralistic democracy was possible in Iraq even when all the voting was along sectarian, religious lines.

It is right to blame Obama because it was he who supported Maliki and who deluded himself into believing that a pluralistic democracy was possible in Iraq - even if U.S. forces were gone.  It was he who pretended that it was OK for the U.S. to withdraw, and thus satisfy the war weary American voting public that this stupid war had come to an end.  It was he who failed to support the "moderate" forces fighting Assad in Syria, thus allowing the al Qaeda forces who had been driven from Iraq to regroup to fight in Syria, become stronger and reform themselves as I.S.I.S. and come back into Iraq to threaten Baghdad.

It is wrong to blame either Bush or Obama because the one who actually lost Iraq is Maliki, who decided to turn Iraq into a puppet state run by Shiite Iran, and to wage a "sectarian" war against the Sunnis in both Iraq and Syria.  

It is wrong to blame either Bush or Obama because people keep calling what is going on in Iraq a sectarian war, but it seems to me it is a full blown religious war, and as best I can tell religious wars are outside the scope of negotiation and compromise because both sides are doing the "Will of God" by slaughtering each other.  

So, if the U.S. is to try to negotiate a diplomatic solution, who is going to compromise?  who is going to share power?  who is going to create a state that allows both Shia and Sunni to rule together?

Or, if the U.S. is to send in planes or drones, who are they supposed to kill?  The Sunni blood thirsty jihadists or the Shiite blood thirsty jihadists?

And, if we don't use diplomatic or military tools to keep the I.S.I.S. nutcases from exploding the Middle East into a multiple nation wide slaughter, don't we put ourselves and the West in mortal danger of future 9/11 attacks?  

Maybe the old "balance of power" theory of the Cold War is the best hope - where neither side is so powerful that they can wipe out the other, so each side has no choice but to come to negotiated settlements.  When Bush and Obama empowered Maliki in their own ways, the Shiites became too powerful and just went for their centuries old lust for revenge and tyranny.  Not a good idea.

I don't understand why Iraq doesn't just split into three parts, Kurds in the north, Shiites in the south, and Sunnis in the middle.  Or maybe the middle is where the nutcases go to kill each other.

Saturday, June 7, 2014

Tea Party delusions of autonomy

The recent success of Republican Tea Party candidate in Mississippi, Chris McDaniel, against more temperate incumbent, Republican Thad Cochran, in Tuesday's primary vote brings to light something odd about the far right wing Tea Party.

One of the Tea Party's main themes is to cut government spending, to take away the debilitating government teat and push people out into the cold cruel world and make them fend for themselves.  This is to make them tougher people, more Manly, more self sufficient, more like the ideological champion of hyper-masculinity, the woman Ayn Rand.  This is to force the United States to become the kind of fierce and independent place that the Tea Party imagines themselves to be, and imagines to be the future of an ideal America.

But, an odd thing happens when you look at some data.  When you look at how much money the federal government gives each state compared to how much money the federal government gets from each state, a funny things shows up.

The hard core Southern Red states are on the dole. They take much, much more money from the federal government than they give it.  

According to, Mississippi receives $3.07 for each $1.00 it gives.  That ranks them as no. 45 out of the 51 states as the most dependent on the federal government.  Here are the five biggest moochers of the states:

  • 51.   South Carolina receives $7.87 federal dollars for every $1.00 sent to the federal government
  • 50.   North Dakota receives $5.31 federal dollars for every $1.00 sent to the federal government
  • 49.   Florida receives $4.57 for every $1.00 sent
  • 48.   Louisiana receive $3.35 for every $1.00 sent
  • 47.   Alabama receives $3.28 for every $1.00 sent
I don't think there is anything wrong with the federal government spending more in states than they receive, but to hear the Tea Party candidates talk, you would think that they think it is a major sin.

A Mississippi Democrat makes it very clear that Mississippi deeply needs the federal government:

“If Mississippi did what the tea party claims they want . . . we would become a Third World country, quickly,” said Rickey Cole, the state Democratic chairman. “We depend on the federal government to help us build our highways. We depend on the federal government to fund our hospitals, our health-care system. We depend on the federal government to help us educate our students on every level.”  Cole noted that the hospital he was born in “wasn’t built by the taxpayers of Mississippi, it was built with federal money that was collected from taxpayers in New York and Chicago and L.A. and San Francisco.”

And, oh yes, which are the five states that pay the most to and get the least from the federal government?

  • 1.  Delaware receives $0.50 for every $1.00 sent
  • 2.  Minnesota receives $0.56 for every $1.00 sent
  • 3.  Illinois receives $0.56 for every $1.00 sent
  • 4.  Nebraska receives $0.57 for every $1.00 sent
  • 5.  Ohio receive $0.66 for evey $1.00 sent
If you click through to the link you will see that the conservative solid South is very much on the receiving side, and the liberal states are much more on the giving side.  Well, in a way, I guess that fits the stereotypes of each - liberals think it is good to give and conservatives want to get as much as they can get.  

Looks like both sides are getting what they want.

Thursday, June 5, 2014

SEC takes on High Frequency Trading (HFT)

The good news is that Mary Jo White, head of the SEC, is apparently taking on the corrupt thievery of high frequency traders, whose methods of skimming billions out of stock market were so clearly dramatized by Michael Lewis's wonderful book "Flash Boys."  

She speaks very cautiously about the way the market is being conducted, but the bottom line is that she is looking at creating rules to make fundamental changes.

"Responding to concerns about high-frequency trading, White enlisted SEC staff to prepare rules to require high-speed traders to register as dealers with the SEC and to bring more of this trading population under the Financial Industry Regulatory Authority, a self-regulating organization.  These steps "should significantly strengthen regulatory oversight over active proprietary trading firms and the strategies they use," White said."

The SEC will look at ways to minimize the speed advantages of the HFT folks, and to take away the lack of transparency in the Too Big To Fail big banks' "Dark Pools" where trades are made out of sight of investors, and the investors must simply take the prices given to them coming out of the Dark Pools.

The SEC will also be looking to counter the market instability that is being created by High Frequency Trading computer programs, as witnessed by a "flash crashes" in the past, in which the market dives precipitously so fast that no humans can intervene to stop the computers from grinding out their protocols at lightning speeds.

Congratulations to Mary Jo White, the SEC, Michael Lewis, and the hero of his book, Brad Katsuyama. And to the investing public.