While We Were Away

Marina and I just got back from a lovely vacation. While we were away, one amazing story seems to have slid beneath the radar of the chattering class:

Here, on a sleepy stretch of shoreline at the far end of Asia, is surely the biggest and most secretive gathering of ships in maritime history. Their numbers are equivalent to the entire British and American navies combined; their tonnage is far greater. Container ships, bulk carriers, oil tankers - all should be steaming fully laden between China, Britain, Europe and the US, stocking camera shops, PC Worlds and Argos depots ahead of the retail pandemonium of 2009. But their water has been stolen.

They are a powerful and tangible representation of the hurricanes that have been wrought by the global economic crisis; an iron curtain drawn along the coastline of the southern edge of Malaysia's rural Johor state, 50 miles east of Singapore harbour.

It is so far off the beaten track that nobody ever really comes close, which is why these ships are here. The world's ship owners and government economists would prefer you not to see this symbol of the depths of the plague still crippling the world's economies.

So they have been quietly retired to this equatorial backwater, to be maintained only by a handful of bored sailors. The skeleton crews are left alone to fend off the ever-present threats of piracy and collisions in the congested waters as the hulls gather rust and seaweed at what should be their busiest time of year.

Amazing how efficient unfettered global capitalism is, huh? Here's a picture of some of the ships:

On a Solemn Day

A stern reminder from the Onion:

Economics in the Age of Skynet, Part 2

Back in October, I attributed the economic crisis to excessive dependence on mathematical modeling. Krugman has a much more expansive discussion along the same lines in yesterday's NYT magazine.

As I see it, the economics profession went astray because economists, as a group, mistook beauty, clad in impressive-looking mathematics, for truth. Until the Great Depression, most economists clung to a vision of capitalism as a perfect or nearly perfect system. That vision wasn’t sustainable in the face of mass unemployment, but as memories of the Depression faded, economists fell back in love with the old, idealized vision of an economy in which rational individuals interact in perfect markets, this time gussied up with fancy equations. The renewed romance with the idealized market was, to be sure, partly a response to shifting political winds, partly a response to financial incentives. But while sabbaticals at the Hoover Institution and job opportunities on Wall Street are nothing to sneeze at, the central cause of the profession’s failure was the desire for an all-encompassing, intellectually elegant approach that also gave economists a chance to show off their mathematical prowess.

Unfortunately, this romanticized and sanitized vision of the economy led most economists to ignore all the things that can go wrong. They turned a blind eye to the limitations of human rationality that often lead to bubbles and busts; to the problems of institutions that run amok; to the imperfections of markets — especially financial markets — that can cause the economy’s operating system to undergo sudden, unpredictable crashes; and to the dangers created when regulators don’t believe in regulation.

It's wort reading the whole thing. We may be on the verge of a double-dip.

GOP Cynicism versus Reality

Here's the cynical gambit currently being played by hawks on the right:

Our guess, however, is that Cheney overstates when he says "so many Americans have doubts." We'd venture that for most people the Obama administration's see-no-evil approach is comforting. After years of fear and vigilance, it's nice to be able to relax and not worry so much about terrorism.

It's nice--but potentially dangerous. If the Bush administration's policies really did keep us safe for 7½ years, then it stands to reason that the Obama administrations' policies may be endangering us now. Certainly that is how the public would see it in the event of another terrorist attack.

If that happens, heaven forbid, Obama will be seen to have failed in the most basic presidential duty, and the Bush administration will be vindicated. As inconceivable as it may seem today, the 2012 election may end up turning on national security. Republicans would be wise to nominate someone with both toughness and experience. Under such circumstances, it's hard to think of a better candidate--assuming, of course, that he could be persuaded to run--than Richard B. Cheney.

I find it telling that Republicans have been reduced to betting on a terror attack and pushing for revolution or secession. These guys have some fucked up "wishful thinking."

For those of you keeping score at home ... here's the perspective of our actual National Security Adviser (a Republican):

Responding to criticism from former Vice President Cheney that President Obama is making the nation more vulnerable to terrorism, the president’s National Security Adviser, Gen. Jim Jones (Ret.), told ABC News in an exclusive interview that actually the reverse is true: President Obama’s greater success with international relations has meant more terrorists put out of commission.

“This type of radical fundamentalism or terrorism is a threat not only to the United States but to the global community,” Jones said. “The world is coming together on this matter now that President Obama has taken the leadership on it and is approaching it in a slightly different way – actually a radically different way – to discuss things with other rulers to enhance the working relationships with law enforcement agencies – both national and international."

Jones said that “we are seeing results that indicate more captures, more deaths of radical leaders and a kind of a global coming-together by the fact that this is a threat to not only the United States but to the world at-large and the world is moving toward doing something about it.”

With or without a new terror attack, it's the current administration that is bringing more real security to the world--not just the appearance of security that comes with a heavy hand.