1
Opinion
Now the Desert Is Just a Desert
What’s hidden behind the living diorama of the American Old West.
2
Business Day
Rajat Gupta Ordered to Reimburse Goldman Sachs $6.2 Million
A federal judge on Monday ordered Rajat Gupta, the former Goldman Sachs director, to reimburse the bank for some legal expenses connected to his insider trading case.
3
U.S.
C. Everett Koop, Forceful U.S. Surgeon General, Dies at 96
Dr. Koop was widely regarded as the most influential surgeon general in American history and played a crucial role in changing public attitudes about smoking.
4
U.S.
Republicans Sign Brief in Support of Gay Marriage
Dozens of prominent Republicans have signed a legal brief that will be submitted to the Supreme Court arguing that gay people have a constitutional right to marry.
5
World
From Hyderabad, a Tale of Two Snack Bars
Examining the long-term impacts of terrorism, from the recent blasts to the 2007 explosions.
6
Business Day
Smartphones Gain Ground in India
Apple, which has long had a minimal presence in India, is aggressively pushing the iPhone there and posing a challenge to BlackBerry.
7
N.Y. / Region
Silver Calls for Reversing Cuomo’s Cut in School Aid
Sheldon Silver, the Legislature’s top Democrat, opposes Gov. Andrew M. Cuomo’s insistence on penalizing New York City schools over a teacher-evaluation impasse.
8
World
Video Shows Group Holds Family Seized in Cameroon
In the video, a hostage and a gunman say that the French family, taken last week on the Cameroon-Nigeria border, is being held by the Islamist group Boko Haram.
9
World
A Hint of Horse Meat Has a Nation Squirming More Than Its Neighbors
With equine DNA detected around Europe in foods billed as containing beef, no one seems able to say exactly why the British are so much more upset about it.
10
Opinion
What Mortgage Relief?
Banks have been structuring debt relief in ways that help their own balance sheets rather than borrowers.
In the report, the settlement monitor, Joseph Smith, said the banks
still had much work to do on the borrowers’ behalf. We’ll believe it
when we see it."
11
Business Day
Treasury Auctions Set for This Week
The following tax-exempt fixed-income issues are scheduled for pricing this week.A Tale of Two Adjustments
A commenter on my last euro post
asks a good question: didn’t Germany once have a problem of excessive
unit labor costs, which it cured with a protracted squeeze? And in that
case, why is it so terrible if Spain is asked to do the same thing?
The answer is basically quantitative. I’d make three points:
1. Thanks to the giant housing bubble, Spanish costs got much further out of line than Germany’s ever did, so the required adjustment is much bigger.
2. Germany got to do its adjustment in the face of a relatively strong European economy; Spain is being asked to adjust in the face of a depressed Europe sliding back into recession.
3. In part because of this difference in overall macro conditions, but also because Germany doesn’t have a housing boom and is actually engaging in a bit of austerity on its own, the burden of adjustment this time around is falling much more on deflation by the overvalued country.
Here’s a figure that illustrates that point. According to Eurostat data, German unit labor costs peaked in 2003, Spanish costs in 2009. So here’s what the adjustments looked like in each episode, with blue lines representing the earlier case and red lines the later:
You
can see just how much harsher Spain’s adjustment is, and how much less
help it’s getting from rising wages in the rest of the eurozone.
Basically, Germany is refusing to do for Spain what Spain did for
Germany in the past.
And the result of all that is incredibly high unemployment."
The answer is basically quantitative. I’d make three points:
1. Thanks to the giant housing bubble, Spanish costs got much further out of line than Germany’s ever did, so the required adjustment is much bigger.
2. Germany got to do its adjustment in the face of a relatively strong European economy; Spain is being asked to adjust in the face of a depressed Europe sliding back into recession.
3. In part because of this difference in overall macro conditions, but also because Germany doesn’t have a housing boom and is actually engaging in a bit of austerity on its own, the burden of adjustment this time around is falling much more on deflation by the overvalued country.
Here’s a figure that illustrates that point. According to Eurostat data, German unit labor costs peaked in 2003, Spanish costs in 2009. So here’s what the adjustments looked like in each episode, with blue lines representing the earlier case and red lines the later:
And the result of all that is incredibly high unemployment."
Death by Davos
This is the way the euro ends: not with the banks but with bunga-bunga.
OK, the euro isn’t doomed — yet. But the Italian election signals that the eurocrats, who never miss an opportunity to miss an opportunity, are getting very close to the edge.
The fundamental fact is that a policy of austerity for all — incredibly harsh austerity in debtor nations, but some austerity in the European core too, and not a hint of expansionary policy anywhere — is a complete failure. None of the nations under Brussels/Berlin-imposed austerity has shown even a hint of economic recovery; unemployment is at society-destroying levels.
This failure came close to destroying the euro twice, in late 2011 and again last summer, as debtor nations threatened to enter a doom loop of plunging bond prices and failing banks. Each time Mario Draghi and the ECB stepped in to contain the damage, first by lending to the banks buying sovereign debt (LTRO) then by announcing a willingness to buy sovereign debt directly (OMT) ; but rather than taking the near-death experience as a warning, Europe’s austerians took the ECB-engineered calming of markets as a sign that austerity was working.
Well, the suffering voters of Europe just told them differently.
How could they not have seen this coming? Well, in Europe even more than in the US the Very Serious People live in a bubble of self-regard at their own seriousness, and imagine that the general public will follow their lead — hey, it’s the only responsible thing to do. Wolfgang Münchau has a great lede in his column today, that gets at the essence:
I wish I believed that the Italian election would serve as a wake-up call — a reason to, for example, give the ECB a green light for more expansion, a reason for Germany to do some stimulus and for France to call off its unnecessary belt-tightening. My guess, however, is that we’ll just have more lectures to the Italians and everyone else about how they just aren’t trying hard enough.
And there may be worse figures than Beppe Grillo lurking in Europe’s future."
OK, the euro isn’t doomed — yet. But the Italian election signals that the eurocrats, who never miss an opportunity to miss an opportunity, are getting very close to the edge.
The fundamental fact is that a policy of austerity for all — incredibly harsh austerity in debtor nations, but some austerity in the European core too, and not a hint of expansionary policy anywhere — is a complete failure. None of the nations under Brussels/Berlin-imposed austerity has shown even a hint of economic recovery; unemployment is at society-destroying levels.
This failure came close to destroying the euro twice, in late 2011 and again last summer, as debtor nations threatened to enter a doom loop of plunging bond prices and failing banks. Each time Mario Draghi and the ECB stepped in to contain the damage, first by lending to the banks buying sovereign debt (LTRO) then by announcing a willingness to buy sovereign debt directly (OMT) ; but rather than taking the near-death experience as a warning, Europe’s austerians took the ECB-engineered calming of markets as a sign that austerity was working.
Well, the suffering voters of Europe just told them differently.
How could they not have seen this coming? Well, in Europe even more than in the US the Very Serious People live in a bubble of self-regard at their own seriousness, and imagine that the general public will follow their lead — hey, it’s the only responsible thing to do. Wolfgang Münchau has a great lede in his column today, that gets at the essence:
There was a symbolic moment in the Italian elections when I knew that the game was up for Mario Monti, the defeated prime minister. It was when in the middle of the campaign – in the midst of an anti-establishment insurgence – he took off to Davos to be with his friends from international finance and politics. I know his visit to elite gathering in the Swiss mountains was not an issue in the campaign, but it signalled to me an almost comic lack of political realism.What Europe’s VSPs fail to get is that the public perception of their right to lead depends on achieving at least some actual results. What they have actually delivered, however, is years of incredible pain accompanied by repeated promises that recovery is just around the corner — and then they wonder that many voters no longer trust their judgment, and turn to someone, anyone, who offers an alternative.
I wish I believed that the Italian election would serve as a wake-up call — a reason to, for example, give the ECB a green light for more expansion, a reason for Germany to do some stimulus and for France to call off its unnecessary belt-tightening. My guess, however, is that we’ll just have more lectures to the Italians and everyone else about how they just aren’t trying hard enough.
And there may be worse figures than Beppe Grillo lurking in Europe’s future."
The Fever Swamp of the Center, Continued
I love Jonathan Chait’s
phrase “the fever swamp of the center”; it really is true that
self-identified centrists are sounding crazier and crazier, as they try
to reconcile their fanatical devotion to the proposition that both
parties are equally at fault with the distressing reality that Obama
actually advocates the policies they claim to want. And today’s WaPo editorial on the sequester
takes the fever to a new pitch. The editorial admits that Obama is
calling for exactly the polices the WaPo wants, while Republicans are
off the deep end in refusing to consider any revenue; but the piece is
nonetheless written as a criticism of Obama, because
Oh, and I can’t help reacting to this:
So
yes, interest payments are projected to rise, which is not great. But
even a decade from now, they’re expected to be no higher than they were
when Bush the Elder was in the White House — not particularly
astonishing in the aftermath of the worst economic crisis since the
1930s.
So it’s all there: hyperventilating about the deficit, together with an absolute determination to blame both sides equally no matter how unbalanced they really are. And as Chait, Greg Sargent, and others say, this refusal to hold the worse parties accountable is in itself an important source of our political dysfunction."
BBC:
But Mr Bersani, whose coalition won most seats in parliament, did not identify a preferred partner in government.
He said all political parties should take responsibility for the country.
Centre-right leader Silvio Berlusconi said earlier fresh elections should be avoided, and called for a period of reflection, which correspondents suggest could mean he is considering a very awkward alliance with his opponents on the centre-left.
Other European countries have urged Italian politicians to create a stable government as soon as possible - with France and Germany urging continued reform, and Spain describing the result as a "jump to nowhere".
Comic protest
A protest movement led by comedian Beppe Grillo won 25%, but the centrist bloc led by current Prime Minister Mario Monti came a poor fourth, with about 10%.
The outcome of the election, which comes amid a deep recession and tough austerity measures, was so close between the two main blocs that the margin of victory given in interior ministry figures was less than 1% in both houses of parliament.
The winning bloc automatically gets a majority in the lower house. But the same is not true in the Senate, where seat allocations are decided by region and can conflict with the national vote.
European Commission spokesman Olivier Bailly said the EU expected Italy to "honour its commitments" on debt and deficit reduction, and other structural reform, saying he understood the "concern expressed by Italian citizens".
"The Commission has full confidence in Italian democracy and... will work closely with the future government towards the relaunch of growth and job creation in Italy," he said.
BBC economics correspondent Andrew Walker says it will be difficult to form a new government with an agreed economic programme.
Shares and the euro fell as the outcome of the election became clear, amid concern that the reform agenda would be delayed.
Italy's FTSE MIB index initially fell 4.7%, while London's FTSE 100 shed 1.5% and share markets in Frankfurt and Paris also fell more than 2%.
In New York, the Dow Jones Industrial Average fell 1.55% and Asian markets lost between 0.7% and 2.2%.
The yield on Italian government bonds rose sharply, implying markets are more wary of lending to Italy.
'Sacrifices'
Mr Berlusconi, 76, left office in November 2011, facing claims of economic mismanagement as the eurozone struggled to contain Italy's debt crisis.
Italians have had more than a year of technocratic government under Mario Monti. But his attempts to reduce spending caused widespread public resentment and his decision to head a centrist list in the parliamentary elections attracted little more than 10% of the vote.
In a surge in support, Mr Grillo's anti-austerity Five Star Movement attracted more than a quarter of the vote, making it the most popular single party in the lower chamber.
Correspondents say this was an extraordinary success for the Genoese comic, whose tours around the country throughout the election campaign - hurling insults against a discredited political class - resulted in his party performing well in both chambers."
Mr. Obama has presented entitlement reform as something he would do grudgingly, as a favor to the opposition, when he should be explaining to the American people — and to his party — why it is an urgent national need.Oh, Barack, you’re telling me what I want to hear, but you don’t sound as if you mean it! Is this policy analysis, or a lovers’ quarrel?
Oh, and I can’t help reacting to this:
Interest alone will have risen from $224 billion this year to an astonishing $857 billion 10 years from now, according to the nonpartisan Congressional Budget Office.Is $857 billion really astonishing? The American economy is huge, and interest costs are currently very low, so some perspective might be in order. Let’s look at interest as a percentage of GDP:
So it’s all there: hyperventilating about the deficit, together with an absolute determination to blame both sides equally no matter how unbalanced they really are. And as Chait, Greg Sargent, and others say, this refusal to hold the worse parties accountable is in itself an important source of our political dysfunction."
BBC:
"Centre-left leader Pier
Luigi Bersani says Italy is in a "dramatic situation" after election
results that leave the country in political stalemate.
Stock markets and the euro have fallen amid concerns the deadlock could re-ignite the eurozone debt crisis.But Mr Bersani, whose coalition won most seats in parliament, did not identify a preferred partner in government.
He said all political parties should take responsibility for the country.
Centre-right leader Silvio Berlusconi said earlier fresh elections should be avoided, and called for a period of reflection, which correspondents suggest could mean he is considering a very awkward alliance with his opponents on the centre-left.
Other European countries have urged Italian politicians to create a stable government as soon as possible - with France and Germany urging continued reform, and Spain describing the result as a "jump to nowhere".
Comic protest
In his first speech since the elections on
Sunday and Monday, Mr Bersani said: "We are aware that we are in a
dramatic situation, we are aware of the risks that Italy faces."
His centre-left bloc won the lower house vote but failed to
secure a majority in the Senate. Control of both houses is needed to
govern. A protest movement led by comedian Beppe Grillo won 25%, but the centrist bloc led by current Prime Minister Mario Monti came a poor fourth, with about 10%.
The outcome of the election, which comes amid a deep recession and tough austerity measures, was so close between the two main blocs that the margin of victory given in interior ministry figures was less than 1% in both houses of parliament.
The winning bloc automatically gets a majority in the lower house. But the same is not true in the Senate, where seat allocations are decided by region and can conflict with the national vote.
European Commission spokesman Olivier Bailly said the EU expected Italy to "honour its commitments" on debt and deficit reduction, and other structural reform, saying he understood the "concern expressed by Italian citizens".
"The Commission has full confidence in Italian democracy and... will work closely with the future government towards the relaunch of growth and job creation in Italy," he said.
Shares and the euro fell as the outcome of the election became clear, amid concern that the reform agenda would be delayed.
Italy's FTSE MIB index initially fell 4.7%, while London's FTSE 100 shed 1.5% and share markets in Frankfurt and Paris also fell more than 2%.
In New York, the Dow Jones Industrial Average fell 1.55% and Asian markets lost between 0.7% and 2.2%.
The yield on Italian government bonds rose sharply, implying markets are more wary of lending to Italy.
'Sacrifices'
Mr Berlusconi said everyone should now reflect
on what to do next so that fresh elections could be avoided, adding:
"Everyone must be prepared to make sacrifices."
He would not do a deal with Mr Monti's centrist bloc, he
added, saying the prime minister's poor showing was down to popular
discontent with his austerity measures.Mr Berlusconi, 76, left office in November 2011, facing claims of economic mismanagement as the eurozone struggled to contain Italy's debt crisis.
Italians have had more than a year of technocratic government under Mario Monti. But his attempts to reduce spending caused widespread public resentment and his decision to head a centrist list in the parliamentary elections attracted little more than 10% of the vote.
In a surge in support, Mr Grillo's anti-austerity Five Star Movement attracted more than a quarter of the vote, making it the most popular single party in the lower chamber.
Correspondents say this was an extraordinary success for the Genoese comic, whose tours around the country throughout the election campaign - hurling insults against a discredited political class - resulted in his party performing well in both chambers."
12
Science
An Addendum on National Park Cuts
Automatic federal spending cuts would mean sharply reducing access to interpretive centers, campgrounds and the backcountry, the interior secretary says.
13
U.S.
Strong Storm in Plains Brings Added Hazards
A winter storm that stretched from Texas through the Great Plains created whiteout conditions for drivers, and paralyzed response efforts in some area.
14
N.Y. / Region
Accounting for 2/26 in a 9/11 Exhibition
Though there is no direct link between the ’93 and ’01 attacks on the World Trade Center, they will be treated as points on a continuum at the National September 11 Memorial Museum.
15
N.Y. / Region
In Cannibal Case, Officer’s Wife Testifies About a Chilling Discovery
On the first day of Gilberto Valle’s trial, Kathleen Mangan-Valle said that she uncovered a plot by her husband to torture, kill and cook women, herself included.
16
U.S.
Miami-Dade Sees Failure in Company It Favored
Banah International, a sugar company, which was lured to the state and county with the promise of tax incentives, has filed for bankruptcy.
17
N.Y. / Region
Michael J. Maye, Scrappy Leader of Firefighters’ Union, Dies at 82
Mr. Maye led the Uniformed Firefighters Association in the early 1970s, when fires in New York City increased by more than half and the number of firefighters decreased by a third.
18
Business Day
Don’t Call Him Mom, or an Imbecile
The hapless, bumbling father is a stock character in product marketing. The so-called daddy bloggers who attended the recent Dad 2.0 Summit are pushing to change that.
19
Business Day
Mismeasurement of Federal Spending, Investment and Saving
Failing to distinguish between consumption spending and investment spending has muddied the debate about the nation’s deficit and economy, an economist writes.
20
Business Day
A Web Site Tries to Keep It Simple
Larger companies are reluctant to sign up for Recruiterbox’s service without considerable hand-holding. Can the company afford to provide it?
9
Not yet criminal.
11
N.Y. / Region
Michael J. Maye, Scrappy Leader of Firefighters’ Union, Dies at 82
PFLAG Washington DC/Metropolitan Area1701 14th Street NW
Washington, DC 20009
info@pflagdc.org
Phone: (202) 638-3852
PFLAG Washington DC/Metropolitan Area
1701 14th St NW
Washington, DC 20009
info@pflagdc.org
Phone: (202) 638-3852
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Mechanicsburg, PA 17055
pflagcenpa@yahoo.com
Phone: (717) 728-8800
15
Opinion
Stranger Than Fiction on the Cop Beat
The real world of crime was sadder, deeper and more absurd that I had expected.
16
N.Y. / Region
A Musical Pitch to Albany to Raise Minimum Wage
In a video on YouTube, restaurant workers stacking dishes, shaking drinks, chopping onions and plating burritos take a moment to lip-sync and dance along to the 1959 Motown hit “Money (That’s What I Want).”
17
World
South Korean President Warns North Against Nuclear Pursuits
Park Geun-hye, who was sworn in Monday as South Korea’s first female president, urged North Korea to abandon its nuclear ambitions without delay.
18
Business Day
The Challenge of Sentencing White-Collar Defendants
A recent appeals court decision reflects an underlying tension in the sentencing white-collar criminals who present no real threat of physical harm to society and continue to lead productive lives after committing a crime.
19
Science
Sneaky Dogs, a Cool Conference and More
Recent developments in health and science news and glances at what’s ahead.
20
World
Iran Enters Nuclear Talks in a Freshly Defiant Mood
Iran’s leaders believe that they have the upper hand in negotiations with the West in Kazakhstan on Tuesday, and are not likely to offer any new plans or suggestions.
1
2
Opinion
What Mortgage Relief?
4
N.Y. / Region
Accounting for 2/26 in a 9/11 Exhibition
8
9
Business Day
Mismeasurement of Federal Spending, Investment and Saving
moot & wrong
10
Business Day
Treasury Auctions Set for This Week
11
12
Business Day
Executive Pay Votes May Be Harming Shareholders
As we enter this year’s proxy season, it is corporate advisers rather than corporate shareholders that are reaping the benefits of the new executive pay rules, the author writes.
13
14
Business Day
A Web Site Tries to Keep It Simple
16
17
Business Day
The Challenge of Sentencing White-Collar Defendants
18
N.Y. / Region
In Artist's Game Show, the Prize Is a Passport
Erika Harrsch of Queens envisions a borderless continent with an installation that tries to put participants into the position of the millions of people who try to leave their countries every year.
19
Real Estate
Manhattan Rentals, Left Out in the Cold
Ballooning land prices are giving developers little choice but to focus on building — or in some cases, converting to — high-end condos.
20
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