You have to wonder: Will Obama see out his full term?

Edward Snowden has blown the whistle on this presidency

By Damian Thompson

"They could pay off the Triads," says Edward Snowden, the NSA whistleblower interviewed by the Guardian in his Hong Kong hideout. Meaning: the CIA could use a proxy to kill him for revealing that Barack Obama has presided over an unimaginable – to the ordinary citizen – expansion of the Federal government's powers of surveillance over anyone.

Libertarians and conspiracy theorists of both Left and Right will never forget this moment. Already we have Glenn Beck hailing Snowden on Twitter:

Courage finally. Real. Steady. Thoughtful. Transparent. Willing to accept the consequences. Inspire w/Malice toward none.#edwardsnowden

Snowden will be a Right-wing hero as well as a Left-libertarian one. Why? First, he thought carefully about what he should release, avoiding (he says) material that would harm innocent individuals. Second, he's formidably articulate. Quotes like the following are pure gold for opponents of Obama who've been accusing the President of allowing the Bush-era "surveillance state" to extend its tentacles even further:

NSA is focussed on getting intelligence wherever it can by any means possible… Increasingly we see that it's happening domestically. The NSA specifically targets the communications of everyone, it ingests them by default, it collects them in its system and it filters them and it analyses them and it measures them and its stores them for periods of time … While they may be intending to target someone associated with a foreign government or someone they suspect of terrorism, they're collecting your communications to do so. Any analyst at any time can target anyone…

I do not see how Obama can talk his way out of this one. Snowden is not Bradley Manning: he's not a disturbed disco bunny but a highly articulate network security specialist who has left behind a $200,000 salary and girlfriend in Hawaii for a life on the run. He's not a sleazy opportunist like Julian Assange, either. As he says: "I'm willing to sacrifice all of that because I can't in good conscience allow the US government to destroy privacy, internet freedom and basic liberties for people around the world with this massive surveillance machine they're secretly building."

It will be very difficult for the Obama administration to portray Snowden as a traitor. For a start, I don't think US public opinion will allow it. Any explanations it offers will be drowned out by American citizens demanding to know: "So how much do you know about me and my family? How can I find out? How long have you been collecting this stuff? What are you going to do with it?"

Suddenly the worse-than-Watergate rhetoric doesn't seem overblown. And I do wonder: can a president who's presided over, and possibly encouraged, Chinese-style surveillance of The Land of the Free honestly expect to serve out his full term? 

Complex Economic Machinery

Machines can be manipulated and controlled. Real economies can’t.

by Bill Bonner.

A couple weeks ago, we gave a speech in London. In it, we quoted economist Paul Krugman. Here’s the quote, from an article in The New York Times:

“Keynesian economics rests fundamentally on the proposition that macroeconomics isn’t a morality play — that depressions are essentially a technical malfunction. As the Great Depression deepened, Keynes famously declared that ‘we have magneto trouble’ — i.e., the economy’s troubles were like those of a car with a small but critical problem in its electrical system, and the job of the economist is to figure out how to repair that technical problem.”

What kind of brain could think such a thing? How could you confuse an economy with a machine? We promise not to become earnest about it, but it is probably worth spending a few minutes exploring this claptrap.

It is the fatal flaw at the heart of modern economics. It also happens to be the foundation of the Fed’s attempt to revive the economy. Krugman, Bernanke, Summers et al. think they are technicians…

They’ve got the wrong metaphor. You may be able to describe the human body as a machine too. But don’t try to fix it with an adjustable wrench. It’s a good thing Paul Krugman isn’t a medical doctor!

Unlike a machine, an economy was neither designed by anyone nor built in a factory. There are no plans… no owner’s manual… no guide to troubleshooting problems… and no website where owners go to talk about the problems they’ve had and the tricks they’ve used to fix them.

Not made by man… it cannot be repaired by man. But let’s look at why this is so.

US Demographics - Glass Half Full Or Half Empty?

Measuring How Births Swell the Population Isn't Child's Play

Pew Research Center says the birth rate is at its lowest level since at least 1920. But the U.S. fertility rate, an estimate of how many children a woman will have in her lifetime, is well above record lows, says the Population Reference Bureau

By Cark Bialik

A recent report said the U.S. birth rate has dipped to a record low level. But another measure of the nation's fertility remains comfortably above its historic low. The mismatch shows that even in a country with comprehensive birth statistics, summarizing population trends is far from straightforward.

Last week, Pew Research Center said the birth rate last year fell to 63.2 per 1,000 women age 15 to 44. That's the lowest level since at least 1920, the earliest year for which reliable data are available. The report made headlines and even spurred calls for Americans to get procreating lest they fall behind economically.

But the U.S. fertility rate, an estimate of how many children a woman will have in her lifetime, is well above record lows. According to the Population Reference Bureau, a Washington, D.C., research center, it fell in 2011 to just below 1.9 per woman, down from 2.12 in 2007—the highest in the last 40 years—but above a record low of 1.74 in 1976.

Demographers disagree on which measure is best for tracking births' contribution to population growth. The distinction matters because birth trends are monitored closely. A record-low level of fertility could augur problems for future economic growth, while a slight drop from a 40-year high may have less serious implications—particularly because fertility often declines during economic slowdowns.

"Births are at a record low, but it's a much more complex story," said Brady Hamilton, a statistician at the Centers for Disease Control and Prevention's National Center for Health Statistics. "The devil is in the details."

Simply computing a per capita birth rate is flawed, researchers say, as it is skewed by the age and gender structure of a population. A country with a disproportionately high share of older men could have a much lower birth rate than one with a large population of women of child-bearing age, even if women in each country have the same average number of children. Calculating the rate of births per women age 15-44, as Pew and the NCHS do, improves on the raw birth rate as it accounts for the share of the overall population most likely to have children. But the measure—called the general fertility rate by demographers—is still subject to quirks in the distribution of women in that age range.

All sides are feeling sore but divorce seems unlikely

Euro bailout Troika nears end of road with patchy record

By Paul Taylor

If the Troika that handles bailouts of distressed euro zone countries were a soccer team, it would probably be looking for a new manager after achieving a track record of one win, one loss and one draw.

The uneasy trio of European Commission, International Monetary Fund and European Central Bank was assembled in haste in March 2010 after Greece's public debt and deficit exploded and it was about to lose access to market funding.

Last week's IMF "mea culpa" report about the failures of the Greek program blew the lid off the fiction that the three institutions saw eye-to-eye on the rescue packages they designed and are enforcing in Greece, Ireland, Portugal and now Cyprus.

Behind closed doors, they clashed over whether Greece should restructure its debt, forcing investors to take losses, and whether Ireland should make bondholders in its shattered banks share the cost of a financial rescue.

They still differ over whether European governments should write off some loans to Athens to make its debt sustainable in the long term, an idea that is politically explosive before a German general election in September.

Gazprom’s Demise Could Topple Putin

Putin’s Incomprehension may cost him more than euros

By Anders Aslund

No large company in the world has been so spectacularly mismanaged as Russia’s state-dominated natural-gas corporation Gazprom OAO. (GAZP) In the last decade, its management has made every conceivable mistake.

Even so, Russian President Vladimir Putin denies the very existence of a crisis and maintains his support for Alexei Miller, the chief executive officer since 2001. Gazprom’s situation is serious not only because it is Russia’s biggest company by market value, but because Putin is its real chairman. Where Gazprom goes, so does Russia and the Putin government.

In May 2008, Gazprom was one of the world’s most valuable companies with a market capitalization of $369 billion. Miller boasted that it would be the first global company to reach $1 trillion. Today, its market value has plummeted to $83 billion and the decline continues. Although it claimed the largest net income of any global company in 2011 at $44.5 billion and still at $38 billion in 2012, its price-earnings ratio has dropped to a fatally low 2.4 for 2013. It has no credibility with shareholders.

At the heart of Gazprom’s mismanagement lies extreme inertia; reluctance to absorb new information; corruption and outlandish arrogance. Its managers are used to exercising Soviet-style monopoly over consumers, not having realized that the market has taken over. The company has traditionally varied prices by countries for opaque reasons. For example, Lithuania pays 15 percent more for Gazprom gas than neighboring Latvia.

Supply Cutoffs

When consumers behave inappropriately in its eyes, Gazprom cuts off supplies, as it did to Ukraine and much of eastern Europe in January 2006 and 2009. As a result, these dismayed customers have reduced their dependence on Gazprom, by cutting consumption, building converters and storage, and developing alternative supplies.

The Gazprom business model is as simple as old: to produce conventional gas from giant fields in West Siberia and pump it through pipelines to Europe. In the last decade, the company has missed three big revolutions in the industry: the shale-gas expansion in the U.S., the global liquefied-natural-gas boom, and the rise of Chinese demand.

'I Do Not Expect To See Home Again'

NSA Whistleblower on the run

By Marc Pitzke

He was once a cog in the US intelligence apparatus, but 29-year-old ex-CIA employee Edward Snowden has admitted to making one of the biggest intelligence leaks in history. He now faces severe consequences -- but President Obama also has a lot to answer for.

Edward Snowden sits in a hotel room in Hong Kong. He is pale and unshaven, his voice quiet but firm. For fear of spies, he has sealed off the door with cushions. He says he's only gone outside three times in the past three weeks. When the fire alarm went off, he suspected that someone was trying to lure him out of hiding.

Snowden is on the run. The scene, as depicted by London newspaper the Guardian , is the latest and most dramatic chapter of a spy thriller that in recent weeks has kept the United States and much of the world in suspense. Snowden is the highly sought-after man who notified the press about the infamous US surveillance program Prism -- probably one of the biggest leak scandals in the history of espionage.

Snowden didn't have to reveal the fact that he is the whistleblower behind the story. But he decided to out himself voluntarily in a 12-minute video interview that the Guardian posted on its website on Sunday night.

Snowden puts a moral spin on his protest against state data surveillance: "I don't want to live in a society that does these sort of things," says the 29-year-old former CIA technical assistant who was last employed by the defense contractor Booz Allen Hamilton. "I don't want to live in a world where there's no privacy and therefore no room for intellectual exploration and creativity," he continues.

But for that, it may already be too late. The debate that Snowden hoped to initiate has revealed that the US's virtual surveillance network is nearly all-encompassing -- and that citizens are powerless against it. "Welcome to the future," writes Ross Douthat in the New York Times. "Just make sure you don't have anything to hide."

A Historical Coup in Hawaii

Snowden, too, fears this future. The US government, he says, "are intent on making every conversation and every form of behavior in the world known to them."

Answer not a fool to his folly.....

A reflection that is at once comforting and depressing

By Theodore dalrymple

It astonishes me how many people take insult for refutation. They think that if they call someone a name – fool, for example, or dupe – they have successfully disposed of his arguments. For having decided that the person is, say, a fool, they go on to obey the Biblical injunction to 

‘Answer not a fool according to his folly, lest thou also be like unto him.’ 

The internet seems to have reinforced the human tendency to resort to the ad hominem. I cannot claim never to have resorted to it myself, in fact it is one of my chief pleasures in life; but I hope that I never use it as my sole method of argument. I am still intellectually conscientious enough to believe that something must first be shown to be mistaken before one begins to speculate (oh so enjoyably) as to why anyone is so foolish at to believe it. 

The spread of education has done little to raise the tone of argument, or the internet to improve its temper. The power of immediate response that the internet confers upon readers encourages them to give vent to their first and usually violent emotions on reading something with which they disagree. People would never have committed to paper what they are willing to commit to cyberspace; and since the way in which one expresses oneself becomes habitual, the internet causes a decline in civility. One longs for the calmer, slower, more civil world of books and hand-written letters.

My complaints about humanity’s indifference to proper argument, however, are nothing new. I happened the other day to be reading Bishop Butler’s Sermons (edited, incidentally, by Gladstone after his retirement from politics – if only our modern politicians would confine themselves to such noble tasks after their disappearance from national life). I came across the following passage, written nearly 300 years ago:

 Arguments are often wanted for some accidental purpose: but proof as such is what [people] never want for themselves…

Not to mention the multitudes who read merely for the sake of talking, or to qualify themselves for the world, or some such kind of reasons…

Several have no sort of curiosity to see what is true…

The great number of books and papers of amusement…

Have in part occasioned…this idle way of reading and considering things.     

Man does not change very much, then, a reflection that is at once comforting and depressing. 

Decisive Days for Euro

High Court Considers ECB Bond Buys

By Melanie Amann, Thomas Darnstädt and Dietmar Hipp

Germany's highest court is currently reviewing the European Central Bank's controversial bond-buying program to shore up euro-zone crisis countries. A decision in Karlsruhe could determine the common currency's fate.

Somebody at the European Central Bank (ECB) must have pressed the wrong button. A fire alarm went off at the bank's high-rise headquarters in Frankfurt, everything was shut down, including the elevators, and firefighters rushed to the scene.

The false alarm hit the monetary watchdogs last September shortly before ECB President Mario Draghi made the dramatic announcement that he would purchase sovereign bonds in "unlimited quantities" to help debt-ridden countries like Italy, Spain and Greece.

Now, alarm bells are again ringing inside the ECB tower -- only this time it's no drill. On Tuesday and Wednesday of this week, Germany's Constitutional Court in Karlsruhe will rule on the euro crisis aid measure that Draghi announced last fall. As Draghi and his monetary experts on the executive floor of the bank were told by their constitutional experts long ago, this court decision could have an enormous impact on the bank's policies -- and potentially spell the end of the euro.

Over the past few months, Draghi and the heads of government in the European capitals have felt confident about the outcome of the impending ruling. After all, the judges in Karlsruhe have always ultimately endorsed Germany's contributions to euro-zone bailout programs. Nevertheless, the list of questions compiled by the judges for this week's deliberations indicates that everything may be at stake this time around.

When Draghi recently visited French President François Hollande in Paris, the main topic of discussion was not the state of the French economy or Southern Europe, but rather the question of what will happen in Karlsruhe. Only one hour by train away from Frankfurt, a conflict is brewing that already appeared to have been resolved last autumn.

"This is good, very good news," then-Italian Prime Minister Mario Monti said in response to the announcement that the Federal Constitutional Court had refused to issue a temporary injunctionagainst the European Stability Mechanism (ESM), the permanent European bailout fund, and the fiscal pact. Over the following days, the euro climbed to its highest exchange rate in months. The court still had to decide on the main constitutional complaint, but a pragmatic decision in favor of the bailout measures seemed to be nothing more than a technicality.

Now, it appears they were celebrating too soon.

'People at the ECB Are Really Afraid'

The plaintiffs in Karlsruhe -- led by euroskeptic Peter Gauweiler, a member of parliament with the conservative Christian Social Union, the Bavarian sister party to Chancellor Angela Merkel's Christian Democrats -- returned with a more comprehensive constitutional challenge to Draghi's unlimited bailout pledge. The battle over the euro resumed. For the last few days, ECB head Draghi has constantly consulted with his aides on the latest developments in the debate in Karlsruhe and what people in Germany are saying about it. Insiders in the southwestern German city have picked up on this frantic need for information: "The people at the ECB are really afraid," says an official in Karlsruhe.

Egypt's Assault on the Arts

Brotherhoodization of the Opera

Artists and staff of the Cairo Opera House declare a strike prior to a performance of Aida in May of 2013.

By Vivian Salama

As the curtains swept open on the stage of Cairo's historic Opera House in late May, spectators held their breath waiting to be regaled by Giuseppe Verdi's classic Aida, which opens with the Egyptians bracing for invasion by Ethiopians seeking to rescue their princess, Aida, from a lifetime of servitude. What they got, however, may have left Verdi himself on the edge of his seat.

Instead, the cast and crew stood shoulder to shoulder, some in costume, many with placards in hand, denouncing what they called the "Brotherhoodization of the Opera" and declaring the country's Muslim Brotherhood-led government "illegitimate." As the crowd shot to its feet cheering "Bravo!" and chanting "Long Live Egypt," conductor Nayer Nagui announced:

"In a stand against a detailed plan to destroy culture and fine arts in Egypt, we decided as artists and management to abstain from performing tonight's Opera Aida."

It was, for artists and art-lovers alike, a declaration of war.

The move followed the dismissal of the highly respected head of the Cairo Opera, Enes Abdel Dayem, which prompted hundreds to take to the streets in protests that continue even today. Her dismissal came only weeks after President Mohamed Morsi appointed Alaa Abdel-Aziz, a professor of film editing, as the new minister of culture. Abdel Aziz said the decision was in an effort to inject "new blood" into Egypt's art world, which he said is growing increasingly corrupt. That same week, the country's upper house of parliament recommended budget cuts for the Opera, which has been reeling from a drawback of funds in recent years. On Wednesday, prominent artists and intellectuals stormed the Egyptian Ministry of Culture, vowing to stay there until the minister steps down.

"My dismissal has sparked a new revolution -- a cultural revolution," Abdel Dayem, a flute player with a PhD at the Ecole Normale de Musique in Paris, said in an interview. During the past year of fighting, "I refused to close the opera during all of this because the complex is a symbol of our strength and our history as a nation. This is why the people rose up against their decision. They see the effort we are doing to preserve cultural scene in Egypt."

Further heightening fears among many that the government is trying to impose Islamist restrictions on the arts, a lawmaker with the ultra-conservative Nour Party noted last month that ballet performances should be canceled altogether because they encourage "immorality" and "nude art."

The minister has not commented on the protests and calls to the Ministry of Culture were not immediately returned.

The stagnant Mediterranean

Short of a Muslim embrace of the modern, there’s no hope for the future

By Victor Davis Hanson

From the heights of Gibraltar, you can see Africa about nine miles away to the south — and gaze eastward on the seemingly endless Mediterranean, which stretches 1,500 miles to Asia beyond. Mare Nostrum, “our sea,” the Romans called the deep blue waters that allowed Rome to unite Asia, Africa and Europe for half a millennium under a single prosperous, globalized civilization.

Yet the Mediterranean has not always proved history’s incubator of great civilizations — Greek, Roman, Byzantine, Ottoman, Florentine and Venetian. Sometimes, the ancient “Pillars of Hercules” at the narrow mouth of the Mediterranean here at Gibraltar marked not so much a gateway to progress and prosperity as a cultural and commercial cul-de-sac.

With the rise of the Ottoman Empire, and before the construction of the Suez Canal, the old classical city-state powerhouses in Italy and Greece faded from history, as the Mediterranean became more a museum than a catalyst of global change. In contrast, the Reformation and Enlightenment energized Northern European culture, safely distant from the exhausting frontline Mediterranean wars with Islam.

By the early 17th century, Northern Europeans more easily and safely reached the rich eastern markets of China and India by maritime routes around Africa. The discovery of the New World further shifted wealth and cultural dynamism out of the Mediterranean.

For a while, the Mediterranean seemed to roar back after World War II. Huge deposits of petroleum and natural gas were found in North Africa. The Suez Canal was a shortcut to the newly opulent and strategically vital Persian Gulf. With the unification of Europe, and ongoing decolonization of Africa and the Middle East, there was the promise of a new, resource-rich, democratic and commercially interconnected Mediterranean.

Not now. The Arab Spring has brought chaos to almost all of North Africa. The bloodbath in Syria threatens to escalate into something like the Spanish Civil War — sucking in Lebanese militias, Iranian mercenaries, Turkey, the Sunni sheikdoms, Israel and the Palestinians, along with surrogate arms suppliers such as China, Europe, Russia and the United States.

Total surveillance society

The government claims the right to read everything

We knew this administration didn’t like the Second Amendment. We knew it has reservations about the First Amendment, and now we learn that it has dispensed with the Fourth Amendment. The only amendment the administration really likes is the Fifth. The more we learn about the government’s extraordinary ability to read emails, listen to telephone calls and track individual movements, the more frightened everyone should be. New code names, such as Prism, the National Security Agency program that directly mines all information from Gmail, Facebook and other services, have replaced Echelon and Carnivore as scare words.

The government has clearly set out to create a total surveillance society, something that in a rational world would be prevented by the Fourth Amendment protections against unreasonable searches. But disclosures of the administration’s telephone-tapping schemes, frightening as they are, have overshadowed something even worse, the creation of zones within the United States where the Fourth Amendment specifically does not apply.

This is not “hype,” as President Obama called the surveillance disclosures on Friday. They’re real. Agents of the Department of Homeland Security (DHS) have been seizing and copying the contents of laptops, iPhones, iPads and other electronic devices from American citizens coming from or traveling to international destinations based on nothing more than the whim of agents who have no probable cause to believe that any crime has been committed.

In February, the department’s Office of Civil Rights and Civil Liberties, which is supposed to prevent abuses, issued a summary paper that purported to justify the ability of agents to “conduct border searches without suspicion or warrant,” including searches of personal laptops and smartphones. The American Civil Liberties Union then asked the pertinent question: How do agents decide whose laptop to search?

The department responded last week with a memo outlining the legal rationale for “suspicionless” searches, with the familiar Obama administration explanation: It’s a secret, and it has to remain a secret. Four pages dedicated to border-search authority under the Fourth Amendment and a page of First Amendment material were blacked out. The document concluded: “In accordance with established case law, officers may, as a matter of both constitutional law and sound policy, search electronic devices at the border without reasonable suspicion of wrongdoing.”

It’s important to note that the word “border” isn’t limited to an actual border. It’s a term that arbitrarily applies to any place within 100 miles of the actual border, and includes international airports. These have become the new Constitution-free zones, and there’s no reason why the government won’t expand this beyond 100 miles when it becomes convenient. In 2010, a half-million travelers were required to endure secondary screening and groping sessions at airports, and in 383 cases, electronic devices were searched without cause in these zones.

This is done in the usual name of protecting us, yet there’s good reason to doubt that. The highly trained agents who predict crime by hunch often can’t see actual criminals stealing under their noses. Agents of the Transportation Security Administration in Orlando, Fla., were caught stealing iPads from travelers, not by the keen “sixth sense” of DHS agents but by investigators of ABC News. Two TSA airport screeners in New York admitted they stole $160,000 worth of goods from passengers.

Perhaps the latest outcry over the government’s privacy invasions will do some good. In March, the 9th U.S. Circuit Court of Appeals ruled that a revised “reasonable suspicion” standard should apply at the border. “International travelers certainly expect that their property will be searched at the border,” the court reasoned. “What they do not expect is that, absent some particularized suspicion, agents will mine every last piece of data on their devices or deprive them of their most personal property for days (or perhaps weeks or even months, depending on how long the search takes).”

Given the other methods of data collection available to federal agents, airport searches may become less important, but the Fourth Amendment, effectively stripped out by the government, must be restored to the Constitution. If not, it won’t be long before everyone falls into the definition of a Constitution-free zone.

Spending Cuts, Tax Increases, and Austerity

Cutting spending is never easy and engaging in fundamental structural reforms is also politically hard

By  Veronique de Rugy

The debate over the merits of austerity (the implementation of debt-reduction packages) is frustrating for two main reasons. First, the word itself is confusing because it means different things to different people. That’s because in theory a country can reduce its debt by increasing taxes, by cutting spending, or by doing a mix of both. What makes this more confusing is that not all policies meant to reduce the deficit and debt qualify as austerity measures. That is the case for growth-inducing policies such as cutting taxes (supply-side) or increasing spending (Keynesian). 

Unfortunately, the word austerity leads to a lot of miscommunications on both sides of the political aisle. On the free-market side, people will say, “Where is the austerity in Europe?” when what they mean is “Spending wasn’t cut very much in Europe, and often it wasn’t cut at all.” To that statement liberals will respond, “It is not true, austerity was implemented in Europe” while pointing to data about the size of fiscal-adjustment packages in Europe. The reality, however, is somewhere in between. Yes, austerity has taken place in Europe. Big time, actually. However, with some rare exceptions, the form of austerity that was implemented was fairly heavy on the tax-increase side and was far from involving savage spending cuts (some countries, such as Ireland and Greece, did cut spending, but others just slowed its rate of growth). I think this distinction matters because, at least until now, the general consensus in the academic literature is that fiscal adjustment based more heavily on spending cuts was much more likely to achieve successful and lasting reductions in debt-to-GDP ratio than tax-base adjustments. It is, of course, possible that this is not the case today but at least this fact should be acknowledged. 

Lies and Lying Liars

Lying as a democratic virtue of petty economists and politicians 

By Steve Landsburg

 When a politician misleads the public with distorted or flat-out fictional data, or uses eight minutes of national TV time to smear the character of the careful scholar who dared to report an inconvenient set of facts, you can always count on Paul Krugman of the New York Times to leap to the defense of truth and honesty — or, alternatively, to jump on the bandwagon if the politician happens to be a Democrat.

Here, you see, is what happened this week: Salim Furth, an economist at the Heritage Foundation (and a graduate of the University of Rochester, where I knew him to be a thoughtful and honest researcher) testified before the Senate budget committee, where he presented data from the Organisation for Economic Cooperation and Development (OECD) showing that most European governments have recently increased their spending. (This isn’t surprising for several reasons, one of which is that governments often spend more in recessionary times.)

Enter Senator Sheldon Whitehouse of Rhode Island, who spent eight excruciating televised minutes lambasting Furth and questioning his honesty, by reading out OECD numbers that differed dramatically from what Furth had reported. Some choice comments:

Dr. Furth, I am very concerned about your testimony….

When I look at the graph, for instance, which you source to the OECD — did you actually look at what the OECD says?….

They’ve actually written what the numbers are. And here’s what the numbers actually are, according to the OECD….

I am concerned that your testimony to this committee has been meretricious…I am contesting whether you have given us fair and accurate information.

And then there’s another eight minutes of reading out numbers that are, Senator Whitehouse keeps reminding us actually from the OECD, as opposed to these other numbers reported by Furth, which Furth claims are from the OECD, but obviously can’t be, because Whitehouse has the actual OECD numbers right here, and look how different they are — all of this interspersed with a barrage of attacks on Furth’s character and integrity. (See the video below, if you have the stomach for it.)

Now here’s the thing: There are a couple of legitimate reasons why Furth’s and Whitehouse’s numbers don’t agree. The first is that they’re for different time periods. Furth’s are for the years 2007-2012, while Senator Whitehouse’s are for the years 2009-2016. That’s right, 2016. Which brings us to the other reason these numbers differ: Furth’s come from the historical record, while Senator Whitehouse’s come from somebody’s ass.

Putin’s Petro State Approaching Empty

No Good Options for the Kremlin

By Leon Aron

Russia faces two challenges that will affect its preeminence as an energy supplier and its ability to wield oil and gas as geostrategic tools. At stake are the stability of the regime — and perhaps even its survival.

The centrality of hydrocarbons to Russia’s economy is hardly a new issue, but it is one well worth revisiting today. One of the two largest oil producers in the world, Russia accounts for 12 percent of global output. Russia is also the top producer of natural gas, accounting for about 20 percent of the world’s total.

Russia faces two challenges that will affect not only its preeminence as an energy supplier but also its ability to wield oil and gas as geostrategic tools. New technologies are helping other countries develop their own natural resources more easily and inexpensively, threatening billions of dollars of Russian state revenue. At the same time, to maintain the current level of production, not to mention increase it, Russia must make huge investments in exploring and recovering oil from virgin deposits (“greenfields”) of the east Siberian region and the Arctic shelf. The likely result is a significant thinning of oil and gas rents — jeopardizing the stability of the regime and perhaps even its survival.

President Vladimir Putin’s commitment to oil and gas as the mainstay of Russia’s progress stems from a deep and abiding conviction about its importance to the nation’s economy. Long before he came to power, he had believed that “the restructuring of the national [Russian] economy on the basis of mineral and raw material resources” was “a strategic factor of economic growth in the near term.”

In an article published a year before he became president, he reiterated that Russian mineral resources would be central to the country’s economic development, security, and modernization. For Putin, oil and gas were also paramount politically as guarantors of the security and stability of the Russian state. As he put it, “The country’s natural resource endowment is the most important economic and political factor in the development of social production.” Furthermore, he believed the mineral extraction sector of the economy “diminishes social tensions” by raising the “level of well-being” of the Russian population.

The IMF and Greece

'Serious Errors' and 'Crying Need'

Christine Lagarde, indicating what she thinks of the IMF's rulebook. Overruled by 'crying need'.

by Pater Tenebrarum

Someone at the IMF has leaked a a document marked 'strictly confidential' to the press, which contains an internal critique of how the IMF handled the bailout of Greece. In spite of admitting to breaking the institution's own rules, the IMF's bureaucrats insist that of they 'had to do it all over again', they would break them again. This is how bureaucracies in regulatory democracies generally act. Laws and rules are not meant to be followed in 'emergencies', both real and imagined ones. In the end, no-one is ever punished for breaking the law or skirting regulations. However, that is not even the main problem in this particular case. Let us also leave aside for the moment that a free unhampered market economy using a market-chosen money would have no use for an institution like the IMF at all. Here is a summary of the recent revelations: 

“In an internal document marked "strictly confidential," the IMF said it badly underestimated the damage that its prescriptions of austerity would do to Greece's economy, which has been mired in recession for the last six years.

The IMF conceded that it bent its own rules to make Greece's burgeoning debt seem sustainable and that, in retrospect, the country failed on three of its four criteria to qualify for aid.

But the fund also stressed that the response to the crisis, coordinated with the European Union, bought time to limit the fallout for the rest of the 17-nation euro area. And while IMF officials said the lessons learned would lead them to take a tougher stance in future bailouts, they also said that there was little else the fund could have done at the time.