Egypt – Food Prices Rise; Distribution Breaks Down

January 31, 2011 · Posted in Global Economics · Comment

The New York times writes Political Crisis Starts to Be Felt Economically:

An army tank stands guard at the port of Alexandria to make sure no one gets in. The bigger problem is that next to nothing is going out.

For four days now, containers arriving on ships have been stacking up at Egypt’s largest port, shipping company employees and truck drivers here said. With distribution networks barely functioning and the Internet down since Thursday night, much of business in Egypt has nearly ground to a halt.

While protests remain at the center of attention, as jets fly over Liberation Square and escaped prisoners instill fear in the public, the political crisis could turn into a humanitarian one if the current economic paralysis continues.

“A big part of the production system is government-run, and this is frozen, including many of the bakeries making the subsidized bread,” said Hoda Youssef, an economist at the Arab Forum for Alternatives, an independent think tank, and a lecturer at Cairo University. “Here in the short term — today, tomorrow, the coming few days — we might have a serious problem with shortages of food, water and fuel,” Ms. Youssef said.

May I humbly suggest a simply solution: Do away with legalized aggression, that is disband the government and all its “security” forces now, and supplies will start to flow again quickly.

Tags: egypt

Egypt Debt Riskier Than Iraq; Instability Spreads in Middle East

January 28, 2011 · Posted in Foreign Policy · Comment

To pick up on Government Collapses, Crises, and Protests Around the World …

Bloomberg reports Egypt Riskier Than Iraq in Swaps as Protests Spread to Mubarak:

Egypt is riskier than Iraq in the market for credit default swaps for the first time in at least a year after protests denouncing President Hosni Mubarak.

The cost of protecting Egyptian debt against default for five years with the contracts jumped 69 basis points, or 0.69 percentage points, this week to 375 today, compared with 328 for Iraq, according to prices from CMA, a data provider in London. Just last week, Iraqi swaps cost 19 basis points more than Egypt’s, and in June, an average 240 basis points more, as Iraq recovered from the U.S.-led invasion in 2003.

The unrest, inspired by the revolt that toppled Tunisia’s leader, “does raise political risks,” said Eric Fine, a portfolio manager in New York who helps Van Eck Associates Corp. oversee $3 billion in emerging-market assets. “If this is a revolution, the price of risk for Egypt could go much higher, and if it’s a failed one” the cost will drop to 300 basis points and probably 250, Fine said in a phone interview.

Higher borrowing costs may crimp Egypt’s ability to meet its target of cutting the budget deficit to 3 percent of gross domestic product by 2015 from the current 8 percent. Yields at the government’s debt auction climbed this week. The average rate on 91-day bills rose 30 basis points from the previous sale to 9.5 percent, while the yield on 182-day bills advanced 20 basis points to 10.2 percent, data compiled by Bloomberg show.

Here’s an anonymous message:

In addition it seems like something’s happening in Yemen …

Also on Thursday, thousands of protesters took to the streets of Yemen, one of the Middle East’s most impoverished countries, demanding the ouster of the 32-year-old American-backed government of Ali Abdullah Saleh, vowing to continue until the government either fell or consented to reforms.

… and in Algeria …

Algeria’s President Abdelaziz Bouteflika is considering high-level cabinet changed in hope of showing a reformist bent after the country was shaken by riots, people familiar with the matter said.

There is no clear timing for the changes, but one scenario under consideration would include the promotion of Energy Minister Youcef Yousfi to be the new prime minister, replacing current Prime Minister Ahmed Ouyahia, they said. Such a move could be part of a broader reshuffle aimed at replacing officials with ties to political parties with technical experts whose reputations remain intact after the protests.

… and last but not least there are some really impressive pictures here.

Tags: algeria, egypt, yemen

Logic & Evidence vs. Abuse & Trauma

January 27, 2011 · Posted in Philosophy · Comment

I would like to point out a pretty good example of how it is that indoctrinated people “think” these days.

Somebody recently posted this question on reddit:

Reddit amateur economists and philosophers, what are the standard rebuttals to arguments against a progressive tax?

Let me first say I’m American, and in the south, so I get a lot of anti-government/anti-tax people starting conversations with me.

I get into it all the time with people who advocate “fair” taxes and flat taxes. I am of the opinion that these taxes are regressive and shift the tax burden to those who can least afford it, but I often find myself backed into corners where I have to admit that I want corporations to pay a large portion of their profits in taxes. What are some key points I can use to drive home the necessity of a progressive tax?

How can I prove that progressive taxation is the only feasible tax system for America?

You notice how he puts the conclusion first and then tries to look for every conceivable justification that amateur economists and philosophers can possibly throw at him?

This is not an isolated event. This is how most people try to tell themselves that they are participating in intelligent public discourse.

Why do we reasonable people quickly get frustrated with the thought-zombies around us who say things like the above?

Because our process is “Question >> Logic >> Evidence >> Conclusion”, we automatically tend to assume that everyone else goes through this process as well.

We forget that the majority of people around us went through “Mental/Physical Abuse/Neglect >> Trauma >> Coping >> Conclusion >> Contrive evidence and logic to back up traumatic conclusions”. – A childhood scar tissue in other words.

So then people like us often get frustrated if we don’t understand how this kind of traumatic mindset works.

We think that, since logic and evidence is at the root of all our conclusions, surely we can start with logic and evidence and gently guide them to the right conclusions that same way. We forget that it never was logic and evidence that got them to hold their conclusions in the first place.

Thus we have to show compassion, rather than frustration, with people who have been indoctrinated and traumatized in one way or another.

If we don’t, then this in itself is a failure on our part to use logic and evidence to arrive at conclusions on how to best communicate knowledge to those who were never taught how to think, to give them the proper “tools”, as it were, to reason through questions from first principle and arrive at reasonable conclusions themselves.

This is why I think I should try a bit harder to focus on communicating the method of logic and evidence to people, rather than force-feed them my own conclusions.

Tags: abuse, evidence, logic, trauma

Government Collapses, Crises, and Protests Around the World

January 26, 2011 · Posted in Foreign Policy · Comment

Something seems to be brewing these days, now doesn’t it?

January 12th: In Lebanon the unity government collapses:

Lebanon’s unity government has collapsed after the Hezbollah movement and its political allies resigned from the cabinet over arguments stemming from a UN investigation into the assassination of Rafiq al-Hariri, the former Lebanese prime minister, in 2005.

January 14th: In Tunisia the President has stepped down and a state of emergency has been declared:

Tunisian President Zine al-Abidine Ben Ali has stepped down after 23 years in power as protests over economic issues snowballed into rallies against him.

Prime Minister Mohammed Ghannouchi has taken over as interim president, and a state of emergency has been declared.

Mr Ben Ali left Tunisia with his family, and has since arrived in Saudi Arabia, officials said.

Earlier, French media said President Nicolas Sarkozy had rejected a request for his plane to land in France.

Dozens of people have died in recent weeks as unrest has swept the country and security forces have cracked down on demonstrations over unemployment, food price rises and corruption.

(…)

The protests started after an unemployed graduate set himself on fire when police tried to prevent him from selling vegetables without a permit. He died a few weeks later.

Note what’s at the root of the outrage here: Government restrictionism in action. This is what governments do all over the world, from minimum wage legislation to union legislation to antitrust legislation, and what have you; interesting to see people wake up to the injustice of these concepts. Although I do of course realize that that’s not all that this is about. :)

January 20th: Irish government collapses:

Irish Prime Minster Brian Cowen has called an Irish election for March 11th.

Speaking to a packed parliament, Cowen stated that he was reassigning six cabinet portfolios after six of his ministers resigned.

His comments ended a day of mounting chaos in the parliament as it became clear that the Green Party were preventing the Fianna Fail party from replacing the minsters who resigned .

Opposition leader Enda Kenny of Fine Gael said he was delighted there was finally an air of finality because of the naming of an election date.

The Irish collapse of course has to be seen in light of economic difficulties coupled with political disagreements.

January 25th: “Unprecedented” protests in Egypt:

The scope of Egypt’s protests today, calling for greater freedom and downfall of strongman President Hosni Mubarak, is unprecedented.

Though tens of thousands took to the streets of Cairo in 2005 calling for democratic reform, today’s protests are far beyond the action in the capital. Reporters and activists on the scene in Cairo say there was a spirit of anger and defiance in the crowds and there were protests of varying sizes in at least a half-dozen Egyptian cities.

It will be interesting to see if other US backed dictators will soon face similar challenges across the middle east. In particular Pakistan will be interesting to watch.

In any case … what a turbulent start into the year 2011. What a close succession of government failures, collapses, and mass protests in Europe and the Middle East!

Tags: egypt, government collapses, ireland, lebanon, protests, tunisia

Civil Disobedience & Suffering For Freedom

January 26, 2011 · Posted in Philosophy · Comment

Tags: civil disobedience

Intellectual Property Rights and Patents

January 24, 2011 · Posted in General Economics · Comment

An interesting lecture from mises.org on IP rights and the concept of patents:

Tags: patents

Meth and Other Drug War Facts

January 22, 2011 · Posted in Interventionism · Comment

An interesting piece about the prevalence of crystal meth in the modern US:

Suppliers of drugs, consumers of drugs, and even drug addicts have long been known to be “rational” as a group — yes, rational, but stick with me. They respond to changes in prices; they respond to quality differentials and to changes in quality. They also respond — rationally — to changes in risk. So if drug users select their drug of choice using a rational decision-making process, what explains this “march to the bottom” and the emergence of meth in illegal drug markets?

The answer is that crystal meth is a cheap date; it has been referred to as the poor man’s cocaine. Cocaine and meth are both stimulants, so it is reasonable to assume that they appeal to the same subset of drug users. During cocaine’s heyday, meth was nearly extinct on the illegal market.

This changed with Reagan’s “War on Drugs,” which was effective in raising prices for illegal drugs by imposing greater risks and thus higher costs on production, distribution, and consumption. The initial shock of the war on drugs sent black-market entrepreneurs back to the drawing board; they needed to reduce their risk and their costs. What they came back with included highly potent marijuana, crack cocaine, and crystal meth.

It doesn’t take much to figure out that the War on Drugs, just as any other government program, is a very lucrative means used by bureaucrats to transfer extorted money to friends, lobbyists, and themselves.

The United States is the world leader in terms of the percentage of people sitting in prison. Yes, there are more people per 100,000 citizens incarcerated in the US than in China, Russia, or Iran!

According to a study by the U.S. Department of Justice, of the 2.2 million Americans that are currently incarcerated, 21.2 percent of them are non-violent drug offenders. That’s about 466,000 people serving time in rape rooms and mandatory labor camps without having violated anybody else’s rights.

When you make it risky to obtain a substance you drive up its price to ridiculous levels. When you drive up its price you make it immensely profitable for dealers to get people hooked on drugs through free samples or even forceful inducement. Obviously it’s in the dealers’ best interest to keep such policies going.

Then there are prison companies, such as the Geo Group, who are contracted by state and local governments, getting paid based on how many people they imprison, and whose stocks are traded on Wall Street. So their investors and banks have an incentive to keep this racket going by lobbying politicians who vote in a favorable manner.

There are law enforcement agencies with agents, police officers, sheriffs, prison guards who all benefit from such policies because their budgets are increased.

There are pharmaceutical companies whose drugs have been proven to kill or cause long term depression and mental disorders in more people than marijuana would ever even come close to. In fact, there are zero deaths reported as biochemical results of marijuana use. There are more people dying dying from Tylenol, Aspirin or Advil per year. Meanwhile marijuana has been proven to provide many of the desired pain relief effects at much less cost, people can even grow it at home! So obviously the huge pharmaceutical lobby, representing about 50% of Wall Street profits, has an enormous vested interest to invest in Congresspeople who will keep the drug war going.

There are Alcohol and Tobacco companies who were the main sponsors of the anti drug campaigns of the 80s. Alcohol and Tobacco combined kill over 500,000 Americans a year. So you can imagine how much of an incentive they have to ensure that their big competitor, marijuana, remains expensive.

The C.I.A itself was and probably is still trafficking drugs into the US because the business has become so lucrative. There is evidence and testimony from several former federal agents confirming this. You can find more on this in the movie American Drug War – The Last White Hope.

So there are all these people, all from completely different walks of life, unknowingly pulling on the same string to protect their own interests.

In a stateless society such people would have no vehicle to implement their destructive agendas.

It is the existence of a state in the first place, that allows them to bring these plans to fruition.

So long as liberals and other statist drug war opponents don’t understand this simple causality and relentlessly start pointing at the root cause of the problem, they need not be surprised if things won’t change for the better one tiny bit.

Tags: crystal meth, drugs

Eleven Days in Burma

January 21, 2011 · Posted in Foreign Policy · Comment

My friend just came back from a trip to her parents’ motherland, Burma or Myanmar as it’s officially called.

She’s writing about her experiences in a blog that she just started.

If you’re interested in some first hand reporting from a country that few people visit these days, check it out here.

Tags: burma, myanmar

Irish Government Collapses

January 21, 2011 · Posted in Foreign Policy · Comment

Irish Central writes Irish leader Brian Cowen calls an election for March 11:

Speaking to a packed parliament, Cowen stated that he was reassigning six cabinet portfolios after six of his ministers resigned.

His comments ended a day of mounting chaos in the parliament as it became clear that the Green Party were preventing the Fianna Fail party from replacing the minsters who resigned .

Opposition leader Enda Kenny of Fine Gael said he was delighted there was finally an air of finality because of the naming of an election date.

Minister of State Conor Lenihan called for the Taoiseach’s resignation. Lenihan said that the developments over the past 24 hours meant that those who voted for a motion of confidence Cowen on Tuesday have now changed their minds. He urged senior ministers to act urgently.

The proceedings in Irish Parliament had been suspended as opposition leaders refused to move forward until Prime Minister Brian Cowen explained the six recent ministerial resignations.

Rumors of an impending collapse of the government and an immediate election were circulating as the Green Party met to decide whether they would withdraw support for the government.

Earlier today parliament was suspended after rowdy scenes. Opposition leader, Fine Gael’s Enda Kenny demanded that proceeding be suspended until Cowen could explain what was going on within the Government.

Kenny said “This is the worst government in history…This would not have happened even in the days of great dictators. It is unprecedented, what you have done.”

He continued “These are the last days of the worst government in the history of the state.”

Minister for Enterprise, Trade and Innovation Batt O’Keefe tendered his resignation this morning. Wednesday saw Mary Harney from Health, Dermot Ahern from Justice, Noel Dempsey from transport and Tony Killeen from defense all resigned. These followed the resignation of Micheal Martin from foreign affairs who resigned after a failed leadership challenge.

Kenny said that the actions of Cowen had been a “cowardly, disgraceful act” and said he was “refusing to come in here today to tell the people of his country what is happening with a Government that has imploded, with a Government that is dysfunctional, that has disintegrated, and that had let our people down”.

Similarly Eamon Gilmore, Labour party leader, said “What is happening here this morning is disrespectful of the people of this country…There is some Kind of political cynical exercise in last-minute jobbery being hatched by this Government.”

John Gormley, the Green party leader, spoke with Cowen about the resignations. The Green party are understood be by frustrated over the departures. Gormley is expect to discuss the matter later today in parliament.

The Green Party, who had asked in November that an election take place in January, yesterday said that it would take place no later than March. March 11 th has now been designated.

Unfortunately for the Irish people, this done for government has already sealed the deal on screwing their future.

Now another group of people will be voted in as a front to looting the public.

Will they have an incentive to ruffle any feathers within the EU?

I doubt it …

Tags: ireland

New Study: College Students Learn Next to Nothing

January 20, 2011 · Posted in Education · 5 Comments

Remember when the end of the government credit induced housing bubble exposed homes as overpriced that turned out to be worth way less and that many people wished they’d never bought?

If you do and if you have a brain, then you can surely make the connection to the government credit induced college education bubble, whose end will expose college degrees as overpriced, making many people realize they should have never spent that kind of money.

Tags: college graduates