Nothing succeeds, as planned

Greece’s Risk of Default Increases to 98% as European Debt Crisis Deepens

By Abigail Moses - Sep 12, 2011, Bloomberg

Greece’s chance of default in the next five years has soared to 98 percent as Prime Minister George Papandreou fails to reassure international investors that his country can survive the euro-region crisis.

“Everyone’s pricing in a pretty near-term default and I think it’ll be a hard event,” said Peter Tchir, founder of hedge fund TF Market Advisors in New York. “Clearly this austerity plan is not working.”

It now costs a record $5.8 million upfront and $100,000 annually to insure $10 million of Greek debt for five years using credit-default swaps, up from $5.5 million in advance Sept. 9, according to CMA.

Papandreou’s promises to adhere to deficit targets that are conditions of the European Union and International Monetary Fund’s bailout were undermined by data showing Greece’s budget gap widened 22 percent in the first eight months of the year. The nation’s two-year note yield climbed toward 70 percent, while its stock market has plummeted by a third in the past seven weeks.

The default probability for Greece is based on a standard pricing model that assumes investors would recover 40 percent of the bonds’ face value were Greece to fail to meet its obligations.

The nation’s government now expects the economy to shrink more than 5 percent this year, more than the 3.8 percent forecast by the European Commission, as austerity measures deepen a three-year recession. The euro slipped to its lowest level against the yen since 2001 amid concern about the future of the 17-bloc region.

Regional Contagion

The risk of contagion beyond Greece pushed sovereign credit-default swap prices to record highs across the euro region. European bank debt risk also rose to the highest ever amid speculation French lenders will be downgraded because of their holdings of Greek bonds.

The Markit iTraxx SovX Western Europe Index of credit- default swaps on 15 governments soared 18 basis points to a record 354. The Markit iTraxx Financial Index linked to senior debt of 25 banks and insurers increased 14 basis points to 314 and the subordinated index jumped 15 to 550, both the highest ever, according to JPMorgan Chase & Co.

“The contagion impact of a default will be severe, because next in the firing line will be Italy, Spain and it will take in the whole of the European banking sector too,” Suki Mann, a strategist at Societe Generale SA in London, wrote in a note. “This trio are already under intense pressure, but it will get much worse.”

Portugal, Italy

Credit-default swaps on Portugal, Italy and France surged to records, according to CMA, which is owned by CME Group Inc. and compiles prices quoted by dealers in the privately negotiated market. Portugal jumped 79 basis points to 1,213, Italy rose 40 basis points to 503 and France was up 11 at 189.

The euro weakened as much as 2 percent to 103.90 yen, the lowest level since June 2001. The common currency dropped 0.4 percent to $1.3600.

The ASE Index of Greek stocks fell 4.4 percent to 847.48, from 1,286 on July 22. Greece’s two-year note yields jumped more than 12 percentage points to a euro-era record 69.551 percent, after climbing 9.8 percentage points last week.

Chancellor Angela Merkel’s government is debating how to support German banks should Greece fail to meet budget-cutting terms of its rescue package, three coalition officials said Sept. 9. Credit-default swaps on BNP Paribas SA, Societe Generale SA and Credit Agricole SA, France’s largest banks, surged to all-time highs on bets they’ll have their ratings cut by Moody’s Investors Service this week.

French Banks

Swaps on SocGen were 53 basis points higher at 443, Credit Agricole increased 41 to 331 and BNP Paribas rose 31 basis points to 306, according to CMA.

Moody’s placed the three banks’ ratings on review in June to examine “the potential for inconsistency between the impact of a possible Greek default or restructuring and current rating levels,” the rating company said at the time. Downgrades are likely as the review period concludes, said the people with knowledge of the matter, who declined to be identified because the information is confidential.

The cost of insuring corporate debt rose to the highest levels in 2 1/2 years, according to JPMorgan. The Markit iTraxx Europe Index of 125 companies with investment-grade ratings was up 6.5 basis points at 198.5 after rising to as high as 204.

Contracts on the Markit iTraxx Crossover Index of 40 companies with mostly high-yield credit ratings climbed 22.5 basis points to 797.5 after earlier touching 811.5, the highest since May 2009. An increase signals worsening perceptions of credit quality.

A basis point on a credit-default swap protecting 10 million euros ($13.7 million) of debt from default for five years is equivalent to 1,000 euros a year. Swaps pay the buyer face value in exchange for the underlying securities or the cash equivalent should a borrower fail to adhere to its debt agreements.

Wild west capitalism

The World's Biggest Employers

by Robert Wenzel
Scary. Seven of ten are government operations, and as Economist notes, the three private companies are Walmart, McDonald's and Taiwan's Hon Hai Precision Industry Company, a subsidiary of which is Foxconn, a secretive electronics manufacturer.

Why do they despise us?

Let’s Roll Over

 

We retreat to equivocation, cultural self-loathing, and utterly fraudulent misrepresentation of 9/11.

By Mark Steyn

Waiting to be interviewed on the radio the other day, I found myself on hold listening to a public-service message exhorting listeners to go to 911day.org and tell their fellow citizens how they would be observing the tenth anniversary of the, ah, “tragic events.” There followed a sound bite of a lady explaining that she would be paying tribute by going and cleaning up an area of the beach.

Great! Who could object to that? Anything else? Well, another lady pledged that she “will continue to discuss anti-bullying tactics with my grandson.”

Marvelous. Because studies show that many middle-school bullies graduate to hijacking passenger jets and flying them into tall buildings?

Whoa, ease up on the old judgmentalism there, pal. In New Jersey, many of whose residents were among the dead, middle-schoolers will mark the anniversary with a special 9/11 curriculum that will “analyze diversity and prejudice in U.S. history.” And, if the “9/11 Peace Story Quilt” at the Metropolitan Museum of Art teaches us anything, it’s that the “tragic events” only underline the “importance of respect.” And “understanding.” As one of the quilt panels puts it:

You should never feel left out

You are a piece of a puzzle

And without you

The whole picture can’t be seen.

And if that message of “healing and unity” doesn’t sum up what happened on Sept. 11, 2001, what does? A painting of a plane flying into a building? A sculpture of bodies falling from a skyscraper? Oh, don’t be so drearily literal. “It is still too soon,” says Midori Yashimoto, director of the New Jersey City University Visual Arts Gallery, whose exhibition “Afterwards & Forward” is intended to “promote dialogue, deeper reflection, meditation, and contextualization.” So, instead of planes and skyscrapers, it has Yoko Ono’s “Wish Tree,” on which you can hang little tags with your ideas for world peace.

What’s missing from these commemorations?

Firemen?

Oh, please. There are some pieces of the puzzle we have to leave out. As Mayor Bloomberg’s office has patiently explained, there’s “not enough room” at the official Ground Zero commemoration to accommodate any firemen. “Which is kind of weird,” wrote the Canadian blogger Kathy Shaidle, “since 343 of them managed to fit into the exact same space ten years ago.” On a day when all the fancypants money-no-object federal acronyms comprehensively failed — CIA, FBI, FAA, INS — the only bit of government that worked was the low-level unglamorous municipal government represented by the Fire Department of New York. When they arrived at the World Trade Center the air was thick with falling bodies — ordinary men and women trapped on high floors above where the planes had hit, who chose to spend their last seconds in one last gulp of open air rather than die in an inferno of jet fuel. Far “too soon” for any of that at New Jersey City University, but perhaps you could reenact the moment by filling out a peace tag for Yoko Ono’s “Wish Tree” and then letting it flutter to the ground.

Upon arrival at the foot of the towers, two firemen were hit by falling bodies. “There is no other way to put it,” one of their colleagues explained. “They exploded.”

Any room for that on the Metropolitan Museum’s “Peace Quilt”? Sadly not. We’re all out of squares.

What else is missing from these commemorations?

“Let’s Roll”?

What’s that — a quilting technique?

No, what’s missing from these commemorations is more Muslims. The other day I bumped into an old BBC pal who’s flying in for the anniversary to file a dispatch on why you see fewer women on the streets of New York wearing niqabs and burqas than you do on the streets of London. She thought this was a telling indictment of the post-9/11 climate of “Islamophobia.” I pointed out that, due to basic differences in immigration sources, there are far fewer Muslims in New York than in London. It would be like me flying into Stratford-on-Avon and reporting on the lack of Hispanics. But the suits had already approved the trip, so she was in no mood to call it off.

How are America’s allies remembering the real victims of 9/11? “Muslim Canucks Deal with Stereotypes Ten Years After 9/11,” reports CTV in Canada. And it’s a short step from stereotyping to criminalizing. “How the Fear of Being Criminalized Has Forced Muslims into Silence,” reports the Guardian in Britain. In Australia, a Muslim terrorism suspect was so fearful of being criminalized and stereotyped in the post-9/11 epidemic of paranoia that he pulled a Browning pistol out of his pants and hit Sgt. Adam Wolsey of the Sydney constabulary. Fortunately, Judge Leonie Flannery acquitted him of shooting with intent to harm on the grounds that “‘anti-Muslim sentiment’ made him fear for his safety,” as Sydney’s Daily Telegraph reported on Friday. That’s such a heartwarming story for this 9/11 anniversary they should add an extra panel to the peace quilt, perhaps showing a terror suspect opening fire on a judge as she’s pronouncing him not guilty and then shrugging off the light shoulder wound as a useful exercise in healing and unity.

What of the 23rd Psalm? It was recited by Flight 93 passenger Todd Beamer and the telephone operator Lisa Jefferson in the final moments of his life before he cried, “Let’s roll!” and rushed the hijackers.

No, sorry. Aside from firemen, Mayor Bloomberg’s official commemoration hasn’t got any room for clergy, either, what with all the Executive Deputy Assistant Directors of Healing and Outreach who’ll be there. One reason why there’s so little room at Ground Zero is because it’s still a building site. As I write in my new book, 9/11 was something America’s enemies did to us; the ten-year hole is something we did to ourselves — and in its way, the interminable bureaucratic sloth is surely as eloquent as anything Nanny Bloomberg will say in his remarks.

In Shanksville, Pa., the zoning and permitting processes are presumably less arthritic than in Lower Manhattan, but the Flight 93 memorial has still not been completed. There were objections to the proposed “Crescent of Embrace” on the grounds that it looked like an Islamic crescent pointing towards Mecca. The defense of its designers was that, au contraire, it’s just the usual touchy-feely huggy-weepy pansy-wimpy multiculti effete healing diversity mush. It doesn’t really matter which of these interpretations is correct, since neither of them has anything to do with what the passengers of Flight 93 actually did a decade ago. 9/11 was both Pearl Harbor and the Doolittle Raid rolled into one, and the fourth flight was the only good news of the day, when citizen volunteers formed themselves into an ad hoc militia and denied Osama bin Laden what might have been his most spectacular victory. A few brave individuals figured out what was going on and pushed back within half an hour. But we can’t memorialize their sacrifice within a decade. And when the architect gets the memorial brief, he naturally assumes that there’s been a typing error and that “Let’s roll!” should really be “Let’s roll over!”

And so we commemorate an act of war as a “tragic event,” and we retreat to equivocation, cultural self-loathing, and utterly fraudulent misrepresentation about the events of the day. In the weeks after 9/11, Americans were enjoined to ask, “Why do they hate us?” A better question is: “Why do they despise us?” And the quickest way to figure out the answer is to visit the Peace Quilt and the Wish Tree, the Crescent of Embrace and the Hole of Bureaucratic Inertia.

Disabling supermen

“Disabled” Parasite Wins Ironman Triathlon

No fate is more horrible than falling prey to parasites

by Moonbat 

Our political system of bureaucratically micromanaged parasitism leaves most of us much poorer than we would be were this still a free country, but for some of us it has been working fine — Aaron Marjala, for example:

Aaron Marjala completed the 2010 Madison Ironman triathlon in 12 hours, 24 minutes. But according to the state of Wisconsin, he is not fit for duty.

“I can’t raise a ladder. There’s stuff I can’t do. I have minor limitations, but it doesn’t stop me from getting out and enjoying stuff like this,” said Marjala.Marjala has completed at least seven marathons and one triathlon — all after the state declared him to be “permanently disabled” from performing his duties as a North Shore firefighter.

Marjala achieved the prized status of “permanently disabled” by bumping his elbow on a counter at the firehouse. At the age of 28, he began collecting the free money he is “entitled” to for the rest of his life. He rakes in over $50,000 tax free, and receives nearly $20,000 worth of health insurance without paying a dime. He is not required to go through the hassle of annual medical checkups to confirm that he still suffers from the alleged numbness in his pinky that supposedly makes him worth so much to the rest of society.

In a single sickening story we see why some people will always vote for Democrats, why the government will never have enough money, and why our civilization is doomed if it doesn’t reverse course sharply.

Ruling opinions out

GAGGING US SOFTLY           

By Mark Steyn

To be honest, I didn’t really think much about “freedom of speech” until I found myself the subject of three “hate speech” complaints in Canada in 2007. I mean I was philosophically in favor of it, and I’d been consistently opposed to the Dominion’s ghastly “human rights” commissions and their equivalents elsewhere my entire adult life, and from time to time when an especially choice example of politically correct enforcement came up I’d whack it around for a column or two.

But I don’t think I really understood how advanced the Left’s assault on this core Western liberty actually was. In 2008, shortly before my writing was put on trial for “flagrant Islamophobia” in British Columbia, several National Review readers e-mailed from the U.S. to query what the big deal was. C’mon, lighten up, what could some “human rights” pseudo-court do? And I replied that the statutory penalty under the British Columbia “Human Rights” Code was that Maclean’s, Canada’s biggest-selling news weekly, and by extension any other publication, would be forbidden henceforth to publish anything by me about Islam, Europe, terrorism, demography, welfare, multiculturalism, and various related subjects. And that this prohibition would last forever, and was deemed to have the force of a supreme-court decision. I would in effect be rendered unpublishable in the land of my birth. In theory, if a job opened up for dance critic or gardening correspondent, I could apply for it, although if the Royal Winnipeg Ballet decided to offer Jihad: The Ballet for its Christmas season I’d probably have to recuse myself.

And what I found odd about this was that very few other people found it odd at all. Indeed, the Canadian establishment seems to think it entirely natural that the Canadian state should be in the business of lifetime publication bans, just as the Dutch establishment thinks it entirely natural that the Dutch state should put elected leaders of parliamentary opposition parties on trial for their political platforms, and the French establishment thinks it appropriate for the French state to put novelists on trial for sentiments expressed by fictional characters. Across almost all the Western world apart from America, the state grows ever more comfortable with micro-regulating public discourse—and, in fact, not-so-public discourse: Lars Hedegaard, head of the Danish Free Press Society, has been tried, been acquitted, had his acquittal overruled, and been convicted of “racism” for some remarks about Islam’s treatment of women made (so he thought) in private but taped and released to the world. The Rev. Stephen Boissoin was convicted of the heinous crime of writing a homophobic letter to his local newspaper and was sentenced by Lori Andreachuk, the aggressive social engineer who serves as Alberta’s “human rights” commissar, to a lifetime prohibition on uttering anything “disparaging” about homosexuality ever again in sermons, in newspapers, on radio—or in private e-mails. Note that legal concept: not “illegal” or “hateful,” but merely “disparaging.” Dale McAlpine, a practicing (wait for it) Christian, was handing out leaflets in the English town of Workington and chit-chatting with shoppers when he was arrested on a “public order” charge by Constable Adams, a gay, lesbian, bisexual, and transgender community-outreach officer. Mr. McAlpine had been overheard by the officer to observe that homosexuality is a sin. “I’m gay,” said Constable Adams. Well, it’s still a sin, said Mr. McAlpine. So Constable Adams arrested him for causing distress to Con­stable Adams.

In fairness, I should add that Mr. McAlpine was also arrested for causing distress to members of the public more generally, and not just to the aggrieved gay copper. No member of the public actually complained, but, as Constable Adams pointed out, Mr. McAlpine was talking “in a loud voice” that might theoretically have been “overheard by others.” And we can’t have that, can we? So he was fingerprinted, DNA-sampled, and tossed in the cells for seven hours. When I was a lad, the old joke about the public toilets at Piccadilly Circus was that one should never make eye contact with anyone in there because the place was crawling with laughably unconvincing undercover policemen in white polonecks itching to arrest you for soliciting gay sex. Now they’re itching to arrest you for not soliciting it.

In such a climate, time-honored national characteristics are easily extinguished. A generation ago, even Britain’s polytechnic Trots and Marxists were sufficiently residually English to feel the industrial-scale snitching by family and friends that went on in Communist Eastern Europe was not quite cricket, old boy. Now England is Little Stasi-on-Avon, a land where, even if you’re well out of earshot of the gay-outreach officer, an infelicitous remark in the presence of a co-worker or even co-playmate is more than sufficient. Fourteen-year-old Codie Stott asked her teacher at Harrop Fold High School whether she could sit with another group to do her science project as in hers the other five pupils spoke Urdu and she didn’t understand what they were saying. The teacher called the police, who took her to the station, photographed her, fingerprinted her, took DNA samples, removed her jewelry and shoelaces, put her in a cell for three and a half hours, and questioned her on suspicion of committing a Section Five “racial public-order offence.” “An allegation of a serious nature was made concerning a racially motivated remark,” declared the headmaster, Antony Edkins. The school would “not stand for racism in any form.” In a statement, Greater Manchester Police said they took “hate crime” very seriously, and their treatment of Miss Stott was in line with “normal procedure.”

Indeed it was. And that’s the problem. When I ran into my troubles up north, a very few principled members of Canada’s bien-pensants stood up to argue that the thought police were out of control and the law needed to be reined in. Among them was Keith Martin, a Liberal MP and himself a member of a visible minority—or, as he put it, a “brown guy.” For his pains, he and a few other principled liberals were mocked by Warren Kinsella, a third-rate spin-doctor for the Liberal party and a chap who fancies himself Canada’s James Carville. As Kin­sella taunted these lonely defenders of freedom of speech, how did it feel to be on the same side as Steyn . . . and anti-Semites . . . and white supremacists? Eh, eh, how’d ya feel about that, eh?

Functionally illiterate

UK even worse at maths than Albania as schools rank 43rd in the world

By Kate Loveys

Britain is languishing behind Albania in a league table for maths and science education, according to an authoritative international study.

A report by the World Economic Forum has ranked UK schools 43rd in the world – behind countries such as Iran, Trinidad and Tobago and Lithuania.

The findings are a damning indictment of Tony Blair’s pledge to prioritise ‘education, education, education’ and come after education spending doubled from £35.8billion to £71billion under Labour.

The Prime Minister will today warn that Britain needs a return to ‘elitism’ and a ‘complete intolerance of failure’ in its schools.

The country must improve standards to compete with the rising economies of India and China, he is expected to say in a major speech.

‘We want to create an education system based on real excellence, with a complete intolerance of failure,’ Mr Cameron will add. ‘We’ve got to be ambitious if we want to compete in the world.

‘When China is going through an educational renaissance, when India is churning out science graduates... any complacency now would be fatal for our prosperity.’

He will hail the opening of the Coalition’s free schools – state schools run by businesses, charities or parents – as indicative of a ‘real passion for education’.

The Prime Minister will also say education reform is vital to help ‘mend our broken society’.

The WEF findings reveal British pupils are at a disadvantage compared to many others around the world, with the country at risk of developing a core skills shortage. 

While the UK languishes in 43rd position in the table, Singapore tops the list, followed by Belgium and Finland.

New Zealand takes seventh place, Canada eighth, France 15th  and Bosnia and Herzegovina 41st. Just below the UK sit Jordan and Romania. 

And Britons do not only fare poorly when it comes to maths and science, as a recent OECD report showed a fifth of 15-year-olds are ‘functionally illiterate’.

The WEF annual study, carried out between January and July, is based on in-depth surveys of 142 countries and takes into account each nation’s economic and business standing.

Conservative MP Chris Skidmore said: ‘After 13 years in which Labour failed to grasp the importance of maths and science education to our future prosperity, this report shows how much ground we have to make up.’

‘We should be competing with  the likes of Singapore, not Iran  and Albania.’

The UK’s ranking in 2008 was 47th, meaning there has been a slight improvement over the last three years.

It is thought this is because during the recession, teenagers have heeded calls from employers for more graduates who have core skills in maths and science.

Drowning by numbers

The Obama Presidency by the Numbers

By MICHAEL J. BOSKIN

When it comes to the economy, presidents, like quarterbacks, often get more credit or blame than they deserve. They inherit problems and policies that affect the economy well into their presidencies and beyond. Reagan inherited Carter's stagflation, George H.W. Bush twin financial crises (savings & loan and Third World debt), and their fixes certainly benefitted the Clinton economy.

President Obama inherited a deep recession and financial crisis resulting from problems that had been building for years. Those responsible include borrowers and lenders on Wall Street and Main Street, the Federal Reserve, regulatory agencies, ratings agencies, presidents and Congress.

Mr. Obama's successor will inherit his deficits and debt (i.e., pressure for higher taxes), inflation and dollar decline. But fairly or not, historians document what occurred on your watch and how you dealt with your in-box. Nearly three years since his election and more than two years since the economic recovery began, Mr. Obama has enacted myriad policies at great expense to American taxpayers and amid political rancor. An interim evaluation is in order.

And there's plenty to evaluate: an $825 billion stimulus package; the Public-Private Investment Partnership to buy toxic assets from the banks; "cash for clunkers"; the home-buyers credit; record spending and budget deficits and exploding debt; the auto bailouts; five versions of foreclosure relief; numerous lifelines to Fannie Mae and Freddie Mac; financial regulation and health-care reform; energy subsidies, mandates and moratoria; and constant demands for higher tax rates on "the rich" and businesses.

Baltic tigers

Interesting Times in Europe's Other Periphery

By ALEN MATTICH

While the countries on the southern and western edges of the euro zone have captured all the headlines with their woes, those on the European Union's eastern periphery have been going through a purple patch.

Indeed, Eastern Europe has been a rare glimmer of good news against the backdrop of an increasingly gloomy global economy. This, though, is unlikely to last. What's more, longer-term problems—notably ageing populations—will continue to hang over these economies.

Poland's performance has been particularly stellar, given that it's one of Europe's largest, albeit relatively undeveloped, countries. By the end of the second quarter, the economy had expanded 4.5% on the same point a year earlier. Slovakia managed 3.5% on the year. And while the Czech Republic's 2.4% was relatively disappointing—largely because of a very subdued second quarter this year—it was handily better than the 1.6% registered by the euro zone generally.

But the real blowout performers were the Baltic states: at the end of the second quarter Estonia had grown by 8.4% on the year, Latvia by 5.7% and Lithuania by 6.2%.

Not all of Eastern Europe did well. The Hungarian and Bulgarian economies were lackluster while Romania barely grew on the year.

With virtually the whole of the region experiencing an export boom, such differences in performance are largely attributable to the relative performances of domestic demand.

Poland has a sizeable enough domestic base to keep up some internal momentum. Elsewhere, consumption has been flagging while some countries have struggled with large government deficits, heavy burdens of external debt or a combination of the two.

All of which makes Germany a big worry for these countries. In the absence of sufficient domestic demand, and given their dependence on German demand for their exports—in part feeding Germany's own industrial boom, any wobble by their giant neighbor would have serious repercussions on their own economies.

Gaia vs. the Big Death

Environmentalists take their zealotry to new lows.

By  Charles C. W. Cooke

Discussing North Korea recently, the journalist Christopher Hitchens reflected darkly that, bad as things are in the Communist country, “at least you can die.” Well, it seems that Kim Jong Il and his merry band have one up on the West. For, here in the free world, even death does not guarantee you escape from the unwanted attentions of the green movement. A Scottish company, whose staff have clearly spent many a long, dark night of the soul fretting over the hazards posed by the greenhouse-gas emissions and energy consumption of funeral-parlor cremation ovens, has developed a new system that literally liquefies human bodies.

The system, which dissolves corpses in heated alkaline water and then smashes the bones up for good measure, has been successfully tested in Australia, and parent company Resomation Ltd. is trying to get the law changed in Europe, the United Kingdom, and all 50 U.S. states to expand the practice. The technique was allegedly “developed in response to the public’s increasing environmental concerns.” I must confess that the mercury content of the burning corpse has never been at the top of the bereaved’s list of concerns at any funeral I have attended, but perhaps I am underestimating the comfort that knowing your late loved one is in for three hours of chemical dissolution — and some good mechanical bone-cracking to boot — can bring to the disconsolate, especially if the procedure is undertaken in the name of environmental purity. Come on Gaia, let’s stick one to Big Death!

Florida will be the first U.S. state fully to enjoy widespread employment of the process, after an Ohio state court deprived Buckeyes of the honor on the grounds that it violated state law. Still, Ohioans managed to dispose of 19 bodies in this manner before the injunction took force. Once dissolved, the remains are so clean that they can be poured into the municipal water system, and resomation inventor Sandy Sullivan assures his critics that the liquefied body tissue poses no environmental risk. Residents of Florida will no doubt take comfort in that the next time they switch on their taps for a cooling glass of water.

The green “solutions” do not end there. Other proposals include freeze-drying the body with liquid nitrogen and then vibrating it until it shatters into fragments, which are passed through filters that separate the remains into different out-trays, a form of afterlife garbage disposal that sounds as if it had come from the more surreal pages of the Onion. The key “advantage” of the procedure, developed by Swedish creator Susanne Wiigh-Masak, is that the body can then be poured into a shallow grave and become soil. In order to test the efficacy of the process, developers fitted a pig with an artificial metal hip, before killing it and pushing it through the contraption. Thus she proved her “organic” credentials.

These, along with the fad of “natural burial” — in which coffins, embalming fluid, and all the salutary advances of the past thousand years are rejected in favor of shallow graves and what effectively amounts to composting — are part of an ongoing and regressive attempt to impose a narrow conception of “sustainability” on even our most private moments. Currently, such systems are voluntary, and families remain free to choose how they dispose of their dead. But if the history of the green movement is anything to go by, such choice will not last long, especially when reducing carbon emissions is the motivating factor. In Agamemnon, the father of tragedy, Aeschylus, noted that “death is better, a milder fate than tyranny.” If he could have seen where things were going, he might not have drawn such a clear distinction.

Athens vs Sparta

The onward march of the Obesity Orwellians

When kids are snatched from their parents simply for being too fat, it’s clearly the expansion of the state, not our waistlines, that is out of control.

By Rob Lyons

‘Parents of seven told: your children are too fat, so you will never see them again.’ So declared the Daily Mail on Monday. And this case is by no means the first one in which children’s excess weight has been used to justify taking them from their parents. Nor is this the only way in which the issue of obesity is being used to intervene in the lives of families today.

The family who featured in the Daily Mail story, who cannot be named for legal reasons, first came to prominence in 2008 when the first threats were made to take their children into care. The parents had actually approached social services themselves, because one of their children had developmental problems. However, the social workers soon focused on their weight. The mother, in her forties, weighed 23 stone, while the father, in his fifties, weighed 18 stone. In 2008, their 12-year-old son weighed 16 stone, his 11-year-old sister weighed 12 stone, and a three-year-old girl weighed four stone.

After being given three months to bring their children’s weights down, to no avail, the family was moved into a two-bedroom ‘Big Brother’-style house where only three of the children were allowed to stay at any one time and their mealtimes were constantly monitored. All seven children were taken into care in 2009 and now it has been revealed that some of the children will be permanently taken out of contact with their parents through fostering or adoption.

There is no doubt that there are other problems in this family besides obesity. However, these are very far from neglected or abused children. This would seem to be a loving family suffering from some difficulties relating to one another. The council has consistently argued that it would not have intervened in the way it did on the grounds of obesity alone. However, it is quite clear that the draconian manner in which the family has been treated is to a significant extent based on concerns about the children’s weights.

While such cases are still unusual, this is not an isolated incident. In 2004, the parents of a nine-year-old girl in Derbyshire were threatened with having her removed due to her weight. In 2007, Newcastle social services made a similar threat in relation to an eight-year-old boy, Connor McCreaddie. In 2008, UK council bosses declared that very fat children should be monitored and taken away from their parents if necessary.

It should be blindingly obvious to medics and social workers that children simply cannot become as fat as these children without some significant genetic predisposition towards piling on the pounds. The drastic act of taking a child from his or her parents should only ever happen when there is clear evidence of serious neglect or abuse. Yet in the cases of many of these fat children, there is little or no evidence of any such neglect or abuse. Instead, obesity itself is taken to be sufficient basis for extreme state action.

The case of Anamarie Regino, a three-year-old girl from New Mexico in the US is instructive in this regard. As Paul Campos relates in his book, The Obesity Myth, Anamarie was taken from her home because it was assumed that her extreme obesity must have been the fault of her parents. Her mother was accused, without evidence, of force-feeding her. However, because Anamarie did show signs of losing weight, she was allowed to return to her parents. Six years later, in 2010, the Albuquerque Journal reported that Anamarie is still struggling with her weight. By then aged 12, standing five feet three inches tall and weighing over 300 pounds, Anamarie had a body mass index (BMI) of around 55. Doctors have still not been able to explain why she is so large.

How taking children like Anamarie, Connor and the Dundee kids away from good homes could ever be seen to help them is a mystery. As Campos writes in relation to Anamarie, the case says ‘a great deal about the hysteria that fat elicits among so many doctors, social workers and other members of helping professions’. The sickness here is not with the children or the parents; rather, it is the hysteria about obesity among social workers, medics and council chiefs that needs treatment.

This obesity hysteria is a sickness that increasingly infects relations between the state, parents and children at many levels. For example, it is now standard practice to weigh children at school and to send letters home to parents. Last week, the Daily Mail reported on Lewis Wighton-Turner, an 11-year-old boy whose parents were told by his school that he was considered clinically obese. The fact that young Lewis takes part in three different sports clubs and has completed an amateur triathlon suggests he might actually be quite healthy.

Then there is the ongoing lunacy around school meals, sparked by Jamie Oliver’s crusades on both side of the Atlantic and the belief that burgers, fries and turkey twizzlers are killing our kids. When parents understandably reacted against these apparently lethal meals by giving their children packed lunches, the result was to turn teachers into snoops inspecting lunchboxes.

The school curriculum now seems to be obsessed with healthy eating and exercise, to the detriment of good education. Children have it drilled into them that they should be fretting about food and bodyweight constantly. Children with a bit of a podge are now led to believe that they could grow up to be sickly, miserable, unlovable specimens for whom the clock will be constantly ticking towards an inevitable early death.

All this from an overreaction to normal variations in body shape combined with the authorities’ determination to persuade us that we are all vulnerable and in constant need of their protection - even from our own loving parents. On this flimsy basis, families are at best being guilt-tripped about what they eat and how they raise their children, and at worst are being torn asunder. It’s not our expanding waistlines but the ever-expanding state that we should really be worried about.

No way out

Why policy advice is futile, and what you should do instead

by DETLEV SCHLICHTER 

The Washington Post recently featured my book in the Political Bookworm column of their online edition. You can see it here. Naturally, I am very pleased about this. There is, however, one sentence, the last in Steven Levingston’s article, that I should probably comment on:

“In all he says, it is hard to know if this [paper money collapse] is his wish or his fear.”

Now let me be very clear that I am convinced that paper money collapse is inevitable. Our present system of elastic money is not only suboptimal it is also unsustainable. As I show in my book through a systematic and fundamental analysis, elastic money must lead to the accumulation of imbalances, to capital misallocations, and to resource mis-pricings, and those must lead, over time, to economic disintegration and chaos.

The present system must end, it will end, it will now certainly end badly and probably soon. As it is inevitable it doesn’t matter what I wish. To wish that this would not happen would be as sensible as to wish that the present summer would not end, and that the days would not get shorter. I don’t wish it and I don’t fear it. The system must go. Good riddance. What I do fear, however, are the political consequences and the societal fall-out from the crisis, and I particularly fear the responses it will provoke from governments and state officials.

Of course, the fiat money crisis is not a natural catastrophe. It is entirely manmade. It is the direct consequence of political decisions and political action. In particular, it is the inevitable consequence of the decision to abandon a gold-based monetary system, a system of essentially inflexible and apolitical money, and to replace it with entirely elastic and constantly expanding paper money under the control of central banks. It is the direct consequence of the erroneous belief – which, sadly, is still the guiding principle of modern central banking and reflected in ninety percent of the financial commentary in the media– that low interest rates and additional credit are good regardless of whether they are the outcome of true saving and capital accumulation, or simply the outcome of fiat money creation.

I am quite glad that Levingston raised the question of my own personal attitude to what is going on because it gives me the opportunity to clarify my position. His point is also somewhat related to something I encounter more often now that I present my book to various audiences or that I give interviews on its subject matter. I think there often exists an assumption that one cannot simply predict some unpleasant outcome in the field of economics and not offer at least a bit of hope that things may turn out differently, of promising the possibility of a way out that would spare us all the painful consequences of past actions, of decades of misguided policy, of cheap credit and limitless money. There is the unspoken belief that after all my research on the topic I must have some good policy advice up my sleeves. Often people ask me, so what should be done? If what central bankers and politicians are doing presently is, as you say in your book and on your website, counterproductive, what should they do instead? What is the solution? Just as in the case of the Washington Post blog, I suspect that the fact that I speak so little about specific policy reforms leads people to believe that I don’t care about where we are going, or I might even look forward to the disaster.

What should be done

There is only one solution and that is to stop the printing of money and the artificial suppression of interest rates, to return to hard money, to allow interest rates and market prices to again reflect the true extent of voluntary savings, and to thus allow the liquidation of the accumulated imbalances from previous money expansion. But because we had a four-decade long period of unprecedented fiat money creation globally, these imbalances are now so big that the necessary liquidation would be very painful – too painful for the political class – which got us into this mess in the first place – to ever deem it acceptable. The overstretched banking industry, the overextended asset markets, insolvent governments – all of this is screaming for a cleansing liquidation and recalibration – and has done so for years. A crisis has now become unavoidable. But politicians still think that the power of the state is unlimited, that what they don’t find acceptable will simply not be allowed to occur. Only in the realm of politics is the belief widespread that reality is optional, and reality must simply be made to conform to the wishes of the political elite. Of course, policy cannot create a new reality. What policy does at the moment is try to postpone the inevitable correction ever further. “Not on my watch” is the modus operandi. This will make the final crisis even worse.

I quoted Ludwig von Mises on this on a couple of occasions but I will do it again. In his magnum opus of 1949, Human Action, the grand master of Austrian School economics said:

“There is no means of avoiding the final collapse of a boom brought about by credit expansion. The alternative is only whether the crisis should come sooner as the result of a voluntary abandonment of further credit expansion, or later as a final and total catastrophe of the currency system involved.”