Friday, July 08, 2011

The Latest American Outrages

The gun cops sell guns to gangsters. The U.S. lets Iraq sell oil rights to China. And don't even talk about the debt debate. Leslie H. Gelb on nine things that just make you want to scream.
by Leslie H. Gelb (/contributors/leslie-h-gelb.html) | July 7, 2011 10:24 PM EDT


Will Rogers liked to say, "It's easy to be a humorist, you have the whole government working for you." Government officials still do, joined by politicians, business leaders, cable news anchors, and foreign officials who take Americans for saps. I wish I could still laugh at their antics. But with upwards of 14 million jobless Americans, I just want to scream. Your call—laugh or scream at these:


1) The Bureau of Alcohol, Tobacco, Firearms, and Explosives sold guns with tracers to low-level Mexican gangsters (/articles/2011/07/06/gun-running-sting-surprise-atf-director-melson-talked-to-congress-july-4.html) in order to catch gangster bigwigs, then lost track of the guns, and found only one or two that were used to kill a Border Patrol agent.



Needless to say the acting head of the ATF is in trouble over this. Even if they fire him, he's shown he's qualified for higher office.


The best moment in this fiasco was captured on The Daily Show when Jon Stewart played back an ATF official's answer to the question, "Did the Mexican government cooperate in this sting operation?" The ATF agent responded: "They were cooperating partly because they didn't know about it." This man has the potential to be a famous diplomat.


2) After the U.S. paid dearly in lives and treasure for Iraqi freedom and even as Washington continues to spend billions for Iraq's future security, the Baghdad government awarded contracts worth billions ... to China.


You say this couldn't have happened? Well, on June 21 the Chinese opened the first major new oil field in Iraq in 20 years (http://www.nytimes.com/2011/06/29/world/asia/29chinairaq.html) . One might have hoped that some high U.S. government official would have told the Iraqi prime minister that if he awarded that contract to anyone but a U.S. oil company, he could forget about future American aid. Mind you, this is just the latest of several oil deals made between Iraq and China.


3) President Obama says the U.S. and NATO aim to prevent Gaddafi from killing vast numbers of innocent Libyan civilians—though he and the George W. Bush clan have praised and honored the colonel.


You say I'm kidding? But here's the record. In May 2010, the White House stood by while Libya was named to a seat on the U.N. Human Rights Council (http://www.reuters.com/article/2010/05/13/us-rights-un-idUSTRE64C5DM20100513) .


Yes, I said Human Rights Council.

Tea party activist on the East Front of the U.S. Capitol hold up signs and flags during a rally on Wednesday, April 6, 2012, days before a possible federal government shutdown. , Douglas Graham / Getty Images


But Obama was just following well-established U.S. policy formulated by the human-rights hero of the neoconservatives—none other than George W. Bush. Under Bush, Gaddafi was allowed to take a seat on the U.N. Security Council, the U.N. biggie. His secretary of state, Condoleezza Rice, called Libya a "model" for others. She later praised Libya for "excellent cooperation in response to common global threats faced by the civilized world since September 11, 2001." Isn't this the same Gaddafi we're now helping our NATO allies (who also praised Gaddafi to the high heavens) bomb to holy hell?


4) Pakistan, for whose future stability we are fighting and dying in Afghanistan, is providing arms, money, intelligence, and safe haven to the very Taliban who are killing our troops in the battle zone.


This is a familiar story by now—one we're supposed to pretend is too complicated for us mere mortal Americans to understand. Supposedly, the situation in Pakistan would be far worse if the United States weren't being a total sucker and fighting for Pakistani interests in Afghanistan while providing Islamabad with billions in yearly aid. And don't forget the latest touch—Thursday's revelation in The Washington Post (http://www.washingtonpost.com/world/national-security/pakistans-nuclear-bomb-maker-says-north-korea-paid-bribes-for-know-how/2010/11/12/gIQAZ1kH1H_story.html) that Pakistan was selling nuclear secrets to one of our other best friends, North Korea.


5) The esteemed Business Forum, long known for its integrity and common sense, finally enters the current debt debate—not to provide desperately needed business sense, but to call for more tax loopholes for corporations even as it demands the deficit be chopped.


Pakistan, for whose future stability we are fighting and dying in Afghanistan, is providing arms, money, intelligence, and safe haven to the very Taliban who are killing our troops in the battle zone.



So you would think that our top business leaders would know best how to be practical in reducing America's $14 trillion debt. And so you'd think that the esteemed business forum would introduce practicality. Yet its report issued in recent days insists on the absolute need to reduce the federal deficit, and then goes on, inexplicably, to say they need more corporate tax breaks and a continuation of tax loopholes on the money they use to make money. Maybe they're so flush with the trillions they've earned over the last decade, and so greedy to earn more, that they secretly don't give a damn about the debt or our country.


6) Even as our troops are fighting to build a new Afghanistan, they also happen to be guarding a very productive and extremely profitable copper mine owned by none other than, you guessed it, China.


You say that our government couldn't possibly be so dumb? Well, one army brigade of about 2,000 troops is deployed in the immediate vicinity of that vast copper mine and, as luck would have it, for Beijing. Maybe somebody in the Obama administration should suggest to Beijing that it deploy its own security force there.


7) Democrats are so totally out of it that they still don't know how to bargain with Republicans.


You'll remember that most Republicans took the pledge never to raise taxes in any way, shape, or form or they'd have to kill their mothers. And there they have stood for almost a year on rock-solid bargaining ground. Why didn't the Democrats take their own pledge not to slash the federal debt on the backs of the middle class and the poor? That would have evened up the bargaining ground.


8) Despite their reputation for practicality, the ongoing debt crisis proves that Republicans still can't add and subtract.


Put it this way, the U.S. has a $14 trillion overall debt and an annual deficit of more than $1.5 trillion. Even if spending were slashed by $700 billion or $800 billion this year alone (far more than the Republicans are demanding), that would still leave us hundreds of billions short of cutting this year's deficit alone—and wouldn't dent the $14 trillion debt by one penny. Indeed, it would add to that overall debt by this year's unpaid billions. Moral: you can’t really reduce the deficit without tax increases, and without cutbacks in defense spending and entitlements. All of which suggests that the Republicans failed arithmetic and passed ideology.


9) Democrats are at a structural disadvantage in public debate: they have no idea how to talk to the people, but the Republicans sure do.


Any Democrat's explanation of a public issue—be it Nancy Pelosi or Harry Reid or President Obama—sounds to my ear as follows: "Four score and 17 points ago, we tried to deliver the nation from want, only to face a long road paved by Herbert Hoover and George W. Bush. It could take 12 or 16 years to solve the problem, to be honest." On the other hand, Republicans conjure up real passion with originals like "Live free or die," "I have only one life to sell for my country," and, "So's your old man." Republicans don't make 17 points; they always keep it to an intelligible half a point plus an insinuation.


Our governmental and political shepherds, cable anchors, foreign and business leaders couldn't possibly believe that we, the American people, will simply continue laughing or screaming at their follies, and that we are so dumb we're just going to sit back and take this. Could they?

July 7, 2011 10:24pm

Thursday, June 30, 2011

Argument, Truth and the Social Side of Reasoning By GARY GUTTING NYTimes

The Stone is a forum for contemporary philosophers on issues both timely and timeless. Arguments, Philosophy, reasoning

The Stone is featuring occasional posts by Gary Gutting, a professor of philosophy at the University of Notre Dame, that apply critical thinking to information and events that have appeared in the news.

Philosophers rightly think of themselves as experts on reasoning. After all, it was a philosopher, Aristotle, who developed the science of logic. But psychologists have also had some interesting things to say about the subject. A fascinating paper by Dan Sperber and Hugo Mercier has recently generated a lot of discussion.

Reasoning is most problematic when carried out by isolated individuals and most effective when carried out in social groups.

The headline of an article in The Times about the paper— echoed on blogs and other sites — was, “Reason Seen More as Weapon than Path to Truth, ” a description, that implied that reason is not, as we generally think, directed to attaining truth, but rather to winning arguments. Many readers of the Times article thought that this position amounted to a self-destructive denial of truth. The article itself (though perhaps not the abstract) suggests a more nuanced view, as the authors tried to explain in replies to criticism. In any case, we can develop an interesting view of the relation between argument and truth by starting from the popular reading and criticism of the article.

Sperber and Mercier begin from well-established facts about our deep-rooted tendencies to make mistakes in our reasoning. We have a very hard time sticking to rules of deductive logic, and we constantly make basic errors in statistical reasoning. Most importantly, we are strongly inclined to “confirmation-bias”: we systematically focus on data that support a view we hold and ignore data that count against it.

These facts suggest that our evolutionary development has not done an especially good job of making us competent reasoners. Sperber and Mercier, however, point out that this is true only if the point of reasoning is to draw true conclusions. Fallacious reasoning, especially reasoning that focuses on what supports our views and ignores what counts against them, is very effective for the purpose of winning arguments with other people. So, they suggest, it makes sense to think that the evolutionary point of human reasoning is to win arguments, not to reach the truth.

This formulation led critics to objections that echo traditional philosophical arguments against the skeptical rejection of truth. Do Sperber and Mercier think that the point of their own reasoning is not truth but winning an argument? If not, then their theory is falsified by their own reasoning. If so, they are merely trying to win an argument, and there’s no reason why scientists — who are interested in truth, not just winning arguments—should pay any attention to what they say. Sperber and Mercier seem caught in a destructive dilemma, logically damned if they do and damned if they don’t.

Philosophical thinking has led to this dilemma, but a bit more philosophy shows a way out. The root of the dilemma is the distinction between seeking the truth and winning an argument. The distinction makes sense for cases where someone does not care about knowing the truth and argues only to convince other people of something, whether or not it’s true. But, suppose my goal is simply to know the truth. How do I go about achieving this knowledge? Plato long ago pointed out that it is not enough just to believe what is true. Suppose I believe that there are an odd number of galaxies in the universe and in fact there are. Still, unless I have adequate support for my belief, I cannot be said to know it. It’s just an unsupported opinion. Knowing the truth requires not just true belief but also justification for the belief.

Rational agreement, properly arrived at, is the best possible justification of a claim to truth.

But how do I justify a belief and so come to know that it’s true? There are competing philosophical answers to this question, but one fits particularly well with Sperber and Mercier’s approach. This is the view that justification is a matter of being able to convince other people that a claim is correct, a view held in various ways by the classic American pragmatists (Peirce, James and Dewey) and, in recent years, by Richard Rorty and J├╝rgen Habermas.

The key point is that justification — and therefore knowledge of the truth — is a social process. This need not mean that claims are true because we come to rational agreement about them. But such agreement, properly arrived at, is the best possible justification of a claim to truth. For example, our best guarantee that stars are gigantic masses of hot gas is that scientists have developed arguments for this claim that almost anyone who looks into the matter will accept.

This pragmatic view understands seeking the truth as a special case of trying to win an argument: not winning by coercing or tricking people into agreement, but by achieving agreement through honest arguments. The important practical conclusion is that finding the truth does require winning arguments, but not in the sense that my argument defeats yours. Rather, we find an argument that defeats all contrary arguments. Sperber and Mercier in fact approach this philosophical view when they argue that, on their account, reasoning is most problematic when carried out by isolated individuals and is most effective when carried out in social groups.

The pragmatic philosophy of justification makes it clear why, even if we start from the popular reading of their article, Sperber and Mercier’s psychological account of reasoning need not fall victim to the claim that it is a self-destructive skepticism. Conversely, the philosophical view gains plausibility from its convergence with the psychological account. This symbiosis is an instructive example of how philosophy and empirical psychology can fruitfully interact.

Wednesday, June 29, 2011

Study: Post-9/11 wars cost U.S. at least $3.7T

The final bill American taxpayers will end up paying for the wars in Afghanistan and in Iraq will be much more than the total amount put forward by the Congress and the federal government, the Reuters news agency reported Wednesday.

The Reuters article focused on a Brown University research project released Wednesday titled "Costs of War." In the end, between at least $3.7 trillion and $4.4 trillion -- mostly in taxpayer dollars -- will have been spent on wartime expenses, mostly on the U.S. military's missions in the respective countries that Osama bin Laden and Saddam Hussein once called home.

The report's release comes as President Obama and congressional Republicans negotiate a deal on federal spending and the national debt. The Treasury Department warns that the United States will default unless the government receives by Aug. 2 the required congressional approval to borrow more money.

The research project's publication also comes a week after Mr. Obama announced his plan to withdraw the so-called "surge" of 33,000 American troops from Afghanistan before Election Day 2012 and the majority of U.S. service members from the country by 2014.

Reuters noted that Mr. Obama told viewers of his prime-time speech in which he announced the drawdown that "over the last decade, we have spent a trillion dollars on war." The Congressional Research Service reported in March that the estimated cost of war funding since the Sept. 11, 2001, terror attacks are $1.4 trillion through 2012, Reuters reports.

"I don't know what the president knows, but I wish it were a trillion," Boston University professor Neta Crawford, a co-director of the report, told Reuters. "It would be better if it were a trillion."

Reuters reports the Brown University research project includes in its total price tag the costs of:

Projected benefits for veterans through 2050: Between $589 billion and $934 billion
Additional Pentagon appropriations: Between $326 billion and $652 billion
Projected war-related spending between 2012 and 2020: $453 billion
Homeland security spending: $401 billion
"Social costs" paid by service members and their families: Between $295 billion and $400 billion
Interest payments for debt incurred from borrowing for war spending: $185 billion
War-related foreign aid: $74 billion

The study doesn't include what Reuters estimates to be at least $1 trillion more in interest that must be paid.

The research project also focuses on the human cost of the wars. As of this writing, The Associated Press reports that 4,466 American troops have died in Iraq, and at least 1,534 U.S. service members have died in the Afghan war. The study estimates that wartime actions directly resulted in the deaths of between 224,000 and 258,000 people, including 125,000 Iraq civilians.

However, one of the project's co-directors told Reuters that the Pentagon's tally of troops who died from the wars should include those who come home and commit suicide or die in car accidents.

"The rate of chaotic behavior is high," said Catherine Lutz, head of Brown's anthropology department.

Lutz told Reuters that the study aimed to answer whether the wars were ultimately worth it in the eyes of Americans.

"I hope that when we look back, whenever this ends," Sen. Bob Corker, R-Tenn., told Reuters, "something very good has come out of it."

Sunday, June 26, 2011

Why Is He Bi? (Sigh) By MAUREEN DOWD NYTimes

HE was born this way.

Bi.

Not bisexual. Not even bipartisan. Just binary.

Our president likes to be on both sides at once.

In Afghanistan, he wants to go but he wants to stay. He’s surging and withdrawing simultaneously. He’s leaving fewer troops than are needed for a counterinsurgency strategy and more troops than are needed for a counterterrorism strategy — and he seems to want both strategies at the same time. Our work is done but we have to still be there. Our work isn’t done but we can go.

On Libya, President Obama wants to lead from behind. He’s engaging in hostilities against Qaddafi while telling Congress he’s not engaging in hostilities against Qaddafi.

On the budget, he wants to cut spending and increase spending. On the environment, he wants to increase energy production but is reluctant to drill. On health care, he wants to get everybody covered but will not press for a universal system. On Wall Street, he assails fat cats, but at cocktail parties, he wants to collect some of their fat for his campaign.

On politics, he likes to be friends with the other side but bash ’em at the same time. For others, bipartisanship means transcending their own prior political identities. For President Obama, it means that he participates in all political identities. He does not seem deeply affiliated with any side except his own.

He was elected on the idea of bold change, but now — except for the capture of Osama and his drone campaign in Pakistan and Yemen — he plays it safe. He shirks politics as usual but gets all twisted up in politics.

The man who was able to beat the Clintons in 2008 because the country wanted a break from Clintonian euphemism and casuistry is now breaking creative new ground in euphemism and casuistry.

Obama is “evolving” on the issue of gay marriage, which, as any girl will tell you, is the first sign of a commitment-phobe.

Maybe, given all his economic and war woes as he heads into 2012, Obama fears the disapproval of the homophobic elements within his own party. But he has tried to explain his reluctance on gay marriage as an expression of his Christianity, even though he rarely goes to church and is the picture of a secular humanist.

While picking up more than three-quarters of a million dollars from 600 guests at a gay and lesbian fund-raising gala in Manhattan on Thursday night, the president declared, “I believe that gay couples deserve the same legal rights as every other couple in this country,” even as he held to his position that the issue should be left to the states to decide.

He’s not as bad as New York’s Archbishop Timothy Dolan, who gave another grumpy interview on Thursday, this time to The National Catholic Register, asserting: “You think it’s going to stop with this? You think now bigamists are going to want their rights to marry? You think somebody that wants to marry his sister is going to now say, ‘I have a right’? I mean, it’s the same principle, isn’t it?”

The archbishop concluded: “Next thing you know, they’re going to say there’s four outs to every inning of baseball. This is crazy.” (He’s beginning to sound like Justice Scalia.)

Still, Obama’s reluctance to come out for gay marriage seems hugely and willfully inconsistent with what we know about his progressive worldview. And it is odd that the first black president is letting Andrew Cuomo, who pushed through a gay-marriage bill in Albany on Friday night, go down in history as the leader on the front lines of the civil rights issue of our time.

But for the president, “the fierce urgency of now” applies only to getting checks from the gay community, not getting up to speed with all the Americans who think it’s time for gay marriage.

As with “Don’t ask, don’t tell,” Obama is not leading the public, he’s following. And worse, the young, hip black president who was swept in on a gust of change, audacity and hope is lagging behind a couple of old, white conservatives — Dick Cheney and Ted Olson.

As a community organizer, Obama developed impressive empathetic gifts. But now he is misusing them. It’s not enough to understand how everybody in the room thinks. You have to decide which ones in the room are right, and stand with them. A leader is not a mediator or an umpire or a convener or a facilitator.

Sometimes, as Chris Christie put it, “the president has got to show up.”

With each equivocation, the man in the Oval Office shields his identity and cloaks who the real Barack Obama is.

He should draw inspiration from the gay community: one thing gays have to do, after all, is declare who they are at all costs.

On some of the most important issues facing this nation, it is time for the president to come out of the closet.

Thursday, June 23, 2011

LIKELY more than $4 trillion!! They don't count replacement costs. medical costs, disability pay etc.....

$1 TRILLION ON WAR IN 10 YEARS --
OBAMA LAST NIGHT , in 15-minute address from East Room, "Remarks by the President on the Way Forward in Afghanistan":

"[T]his has been a difficult decade for our country. We've learned anew the profound cost of war -- a cost that's been paid by the nearly 4,500 Americans who have given their lives in Iraq, and the over 1,500 who have done so in Afghanistan -- men and women who will not live to enjoy the freedom that they defended. ...
Yet tonight, we take comfort in knowing that the tide of war is receding. ... These long wars will come to a responsible end. As they do, we must learn their lessons. Already this decade of war has caused many to question the nature of America's engagement around the world. ...
Like generations before, we must embrace America's singular role in the course of human events. But we must be as pragmatic as we are passionate; as strategic as we are resolute. ...

Tuesday, June 21, 2011

Bachmann’s nonsensical Medicare-‘Obamacare’ claim

By Glenn Kessler



(SEAN GARDNER/REUTERS) “While we've been seeing the liberals in the last few weeks trying to scare Americans about Medicare, and especially senior citizens, what's been ignored is President Obama's plan for senior citizens regarding Medicare. … And do you know what the president's plan is? This hasn't been talked about very much. The president's plan for senior citizens is Obamacare. We all think for our senior citizens that somehow Medicare is going to go on. And I think very likely -- and I'm speculating -- I think very likely what the president intends is that Medicare will go broke, and then ultimately that answer will be Obamacare for senior citizens.”

--Rep. Michele Bachmann (R-Minn.), June 17, 2011

It’s hard to know what to make of this comment by Rep. Michele Bachmann, made during her speech last Friday to the Republican Leadership Conference in New Orleans. She also repeated elements of this claim during an interview with CNN (there is a clip at the end of this column.) “I think the president’s plan is Obamacare for senior citizens,” Bachmann told CNN. “They don’t want Obamacare; they want Medicare, and that’s why I am committed to making Medicare solvent.”

In her speech, the presidential aspirant also made the debunked assertion that regulations are “$1.7 trillion burden on our job creators.” We had examined this several months ago and the Congressional Research Service in April also critiqued the study that is the source of this statistic. Bachmann also repeated the incorrect claim that President Obama took $500 billion “out of Medicare to give it to younger people.”

But Bachmann’s claim that the president’s plan is to replace Medicare with “Obamacare” is what most intrigued several readers. One should always be wary of a politician when he or she says they are “speculating,” since that is an apparent license to throw facts to the wind. A spokeswoman for the Bachmann presidential campaign did not respond to a request for clarification, so we will have to parse this language and her CNN interview ourselves.



The Facts

The current Medicare system, in place since the mid-1960s, is essentially a government-run health care program, with hospital and doctors’ fees paid by the government, though beneficiaries also pay premiums for some services as well as deductibles and coinsurance.

Bachmann says the Democrats are trying to scare seniors about Medicare, and we would agree with that, though Republicans are equally guilty of using scare tactics on Medicare. In fact, Bachmann’s bogus claim about the $500 billion is a good example of such fear-mongering.

But Medicare today is in effect a European-style, socialized health care program, so we are unclear what Bachmann means when she says Obama wants to take a program that is already socialized medicine and turn it into Obamacare. A single-payer option—much like Medicare—was rejected when the Democratic-led Congress drafted the health care law.

Instead, the Obama health care law sets up “health insurance exchanges” in which people can shop for policies. Depending on the income level, they may qualify for a government subsidy.

Ironically, one can make a case that the House Republican budget plan is designed to turn Medicare into a program that has some of the key features of Obama’s health care law.

For instance, seniors would be given government subsidies, which they would then use to shop for coverage from private companies in a new kind of marketplace called an “Exchange.”

Rep. Paul Ryan (R-Wisc.), the chief architect, might dismiss these as superficial similarities but the fact remains that Medicare is currently a government-run program--which is one reason why Democrats so fiercely oppose efforts that they say will dismantle that feature.

That’s why it is strange for Bachmann to suggest that Obama wants to replace Medicare with Obamacare, which relies on the private insurance market. If Obama had had the votes in Congress, he would have pushed for a Medicare-like option in his health care law—but not the other way around.

To top it off, Bachmann voted for the Republican budget plan and claims she supports it to prevent Medicare from “going flat broke in 13 years.” To be clear, only the hospital trust fund will be “depleted’ and the government will still be able to cover 90 percent of the program costs. That is not the same as bankruptcy.



The Pinocchio Test

Are you confused? We’re totally befuddled.

It initially was hard to tell whether Bachmann’s rhetoric in the speech just ran amok or this was a point she wanted to make. But then she repeated the notion that Obama wanted to replace Medicare with “Obamacare” in her interview with CNN. There is no evidence for this and it is completely nonsensical. For a member of Congress, she really should know the basics of government-funded health care programs.



Four Pinocchios

Monday, June 20, 2011

THIS FAIRNESS?

With executive pay, rich pull away from rest of America
By Peter Whoriskey, Published: June 18
It was the 1970s, and the chief executive of a leading U.S. dairy company, Kenneth J. Douglas, lived the good life. He earned the equivalent of about $1 million today. He and his family moved from a three-bedroom home to a four-bedroom home, about a half-mile away, in River Forest, Ill., an upscale Chicago suburb. He joined a country club. The company gave him a Cadillac. The money was good enough, in fact, that he sometimes turned down raises. He said making too much was bad for morale.

Forty years later, the trappings at the top of Dean Foods, as at most U.S. big companies, are more lavish. The current chief executive, Gregg L. Engles, averages 10 times as much in compensation as Douglas did, or about $10 million in a typical year. He owns a $6 million home in an elite suburb of Dallas and 64 acres near Vail, Colo., an area he frequently visits. He belongs to as many as four golf clubs at a time — two in Texas and two in Colorado. While Douglas’s office sat on the second floor of a milk distribution center, Engles’s stylish new headquarters occupies the top nine floors of a 41-story Dallas office tower. When Engles leaves town, he takes the company’s $10 million Challenger 604 jet, which is largely dedicated to his needs, both business and personal.

The evolution of executive grandeur — from very comfortable to jet-setting — reflects one of the primary reasons that the gap between those with the highest incomes and everyone else is widening.

For years, statistics have depicted growing income disparity in the United States, and it has reached levels not seen since the Great Depression. In 2008, the last year for which data are available, for example, the top 0.1 percent of earners took in more than 10 percent of the personal income in the United States, including capital gains, and the top 1 percent took in more than 20 percent. But economists had little idea who these people were. How many were Wall street financiers? Sports stars? Entrepreneurs? Economists could only speculate, and debates over what is fair stalled.

Now a mounting body of economic research indicates that the rise in pay for company executives is a critical feature in the widening income gap.

The largest single chunk of the highest-income earners, it turns out, are executives and other managers in firms, according to a landmark analysis of tax returns by economists Jon Bakija, Adam Cole and Bradley T. Heim. These are not just executives from Wall Street, either, but from companies in even relatively mundane fields such as the milk business.

The top 0.1 percent of earners make about $1.7 million or more, including capital gains. Of those, 41 percent were executives, managers and supervisors at non-financial companies, according to the analysis, with nearly half of them deriving most of their income from their ownership in privately-held firms. An additional 18 percent were managers at financial firms or financial professionals at any sort of firm. In all, nearly 60 percent fell into one of those two categories.

Other recent research, moreover, indicates that executive compensation at the nation’s largest firms has roughly quadrupled in real terms since the 1970s, even as pay for 90 percent of America has stalled.

This trend held at Dean Foods. Over the period from the ’70s until today, while pay for Dean Foods chief executives was rising 10 times over, wages for the unionized workers actually declined slightly. The hourly wage rate for the people who process, pasteurize and package the milk at the company’s dairies declined by 9 percent in real terms, according to union contract records. It is now about $23 an hour.

“Do people bitch because Engles makes so much? Yeah. But there’s nothing you can do about it,” said Bob Goad, 61, a burly former high school wrestler who is a pasteurizer at a Dean Foods plant in Harvard, Ill., and runs an auction business on the side to supplement his income. “These companies have the idea that the only people that matter to the company are those at the top.”

Through a spokesman, Engles declined to be interviewed. Company officials threatened to call the police as a reporter was interviewing workers outside one of its dairies.

Defenders of executive pay have argued that today’s chief executives are worth more because, among other things, companies are larger and more complex.

But critics question why so much of the growth in income should go to the wealthiest. Douglas, the Dean Foods chief from the ’70s, died in 2007. But his son, Andrew Douglas, said his father viewed wages in part as a moral issue.

If his father had seen how much executives were making today, Andrew Douglas said, he’d be “spinning in his grave. My dad just believed that after a while, what else would you need the money for?”

Inherent inequality

Inequality, economists have noted, is an essential part of capitalism. At least in theory, “the invisible hand,” or market system, sets compensation levels to lead workers into pursuits that are the most productive to society. This produces inequality but leads to a more efficient economy.

As a result, economists have noted, there is an inherent tension in market-oriented democracies because while society aims to endow each person with equal political rights, it allows very unequal economic outcomes.

“American society proclaims the worth of every human being,” economist Arthur M. Okun, former chairman of the Council of Economic Advisers, wrote in his 1975 book on the subject, “Equality and Efficiency.’’ But the economy awards “prizes that allow the big winners to feed their pets better than the losers can feed their children.”

Americans have been uneasy about the income gap at least since the ’80s, according to polls.

Repeated surveys by the National Opinion Research Center since 1987 have found that 60 percent or more of Americans agree or strongly agree with the statement that “differences in income in America are too large.”

The uneasiness arises out of the fear that extremes of wealth can unfairly reduce the economic opportunities and political rights of everyone else, according to sociologists. The wealthy, for example, can afford better private schools for their children or acquire political might by purchasing campaign advertising or making campaign donations. Moreover, as millions struggle to find jobs in the wake of the recession, the notion that the very wealthiest are gaining ground strikes some as unfair.

“Americans think income inequality is excessive and have done so consistently for years,” said Leslie McCall, a sociology professor at Northwestern University who is writing a book on the subject. “Their concerns arise when it seems that extreme incomes for some are restricting opportunities for everyone else.”

Whatever people think of it, the gap between the very highest earners and everyone else has been widening significantly.

Income inequality has been on the rise for decades in several nations, including the United Kingdom, China and India, but it has been most pronounced in the United States, economists say.

In 1975, for example, the top 0.1 percent of earners garnered about 2.5 percent of the nation’s income, including capital gains, according to data collected by University of California economist Emmanuel Saez. By 2008, that share had quadrupled and stood at 10.4 percent.

The phenomenon is even more pronounced at even higher levels of income. The share of the income commanded by the top 0.01 percent rose from 0.85 percent to 5.03 percent over that period. For the 15,000 families in that group, average income now stands at $27 million.

In world rankings of income inequality, the United States now falls among some of the world’s less-developed economies.

According to the CIA’s World Factbook, which uses the so-called “Gini coefficient,” a common economic indicator of inequality, the United States ranks as far more unequal than the European Union and the United Kingdom. The United States is in the company of developing countries — just behind Cameroon and Ivory Coast and just ahead of Uganda and Jamaica.

Democratic leaders, whose constituents have expressed more alarm over the divide, have used the phenomenon to justify their policies, such as universal health care.

“A nation cannot prosper long when it favors only the prosperous,” President Obama said in his inaugural address.

Breakdown of earners

But exactly what the government ought to do about the income gap hasn’t been clear, because economists have been divided over what is causing it to grow.

They weren’t even sure, for example, who was making all that money. Sure, people like Bill Gates and LeBron James made lots. But it wasn’t at all clear who the other roughly 140,000 earners were in the top 0.1 percent — that is, people earning about $1.7 million a year, including capital gains.

Then, late last year, economists Bakija, Cole and Heim completed their massive analysis of income tax returns.

Little noticed outside academic circles, their research focused on the top 0.1 percent of earners. From those tax returns, they could glean a taxpayer’s occupation, which is self-reported. Using the employer’s tax identification number, the researchers found the industry they were employed in.

After executives, managers and financial professionals, the next largest groups in the top 0.1 percent of earners was lawyers with 6.2 percent and real estate professionals at 4.7 percent. Media and sports figures, who are often assumed to represent a large portion of very high-income earners, collectively made up only 3 percent.

“Basically, executives represent a much bigger share of the top incomes than a lot of people had thought,” said Bakija, a professor at Williams College, who with his co-authors is continuing the research. “Before, we just didn’t know who these people were.”

Acceptable greed

Defenders of executive pay argue, among other things, that the rising compensation is deserved because firms are larger today. Moreover, this group says, more packages today are based on stock and options, which pay more when the chief executive is successful.

Critics, on other hand, argue that executive salaries have jumped because corporate boards were simply too generous, or more broadly, because greed became more socially acceptable.

Again, in settling these arguments, economists were hampered by a lack of data, particularly any that might give some historical perspective.

It wasn’t until economists Carola Frydman from MIT’s Sloan School of Management and Raven E. Molloy of the Federal Reserve collected and analyzed data going back to 1936 — an exhaustive task because of the lack of computerized records going that far — that the longer-term trends became clear.

What the research showed is that while executive pay at the largest U.S. companies was relatively flat in the ’50s and ’60s, it began a rapid ascent sometime in the ’70s.

As it happens, this was about the same time that income inequality began to widen in the United States, according to the Saez figures.

More importantly, however, the finding that executive pay was flat in the ’50s and ’60s, when firms were growing, appears to contradict the idea that executive pay should naturally rise when companies grow.

This is a “challenge for the market story,” Frydman said.

So what happened since the ’70s that has sent executive pay upward?

While no company over this period of time — from the 1970s to today — can be considered completely typical, Dean Foods offers a better comparison than most because fundamentally it hasn’t changed.

The dairy business is still the root of the company; it was on the Fortune 500 by the late ’70s and remains there today. It grew then and more recently through acquisition.

Moreover, both chief executives — Douglas and Engles — could boast records of growing the company and profits.

From 1970 to 1979, while Douglas was the chief executive, sales at Dean Foods tripled and profits increased tenfold, to $9.8 million, according to company records. Similarly, from 2000 to 2009, sales at what would be Dean Foods had roughly doubled, and so had profits, to $228 million. (Engles became chief executive after the company he led bought Dean Foods in 2001 and adopted its name.)

Yet there are vast differences in the way the two men were paid, even when you adjust for the effects of inflation.

In the late 70s — 1977, 1978 and 1979 — Douglas made about $1 million annually in today’s dollars. The largest part of that was a salary; some came from a long-term incentive based on the stock price that would not mature until he retired.

By contrast, in the late 2000s — 2007, 2008 and 2009 — Engles averaged $10.5 million annually, most of it in stock and options awards and other incentive pay, according to proxy statements. After ’09, which was a particularly bad year, Engles’s compensation dropped to $4 million in 2010. If profits return, so will his higher earnings.

The case of Dean Foods appears to bolster the argument that executive compensation moves with company size: The profits for Dean Foods in 2009 were roughly 10 times what they were in 1979, adjusted for constant dollars. Engles’s compensation has averaged 10 times that of Douglas.

“It’s a different company today,” company spokesman Jamaison Schuler said. He declined to comment further.

But some economists have offered an alternative, difficult-to-quantify explanation: that the social norms that once reined in executive pay have disappeared.

This new attitude, according to this view, was reflected in epigrammatic form by the 1987 movie “Wall Street,” which made famous the phrase “greed, for lack of a better word, is good.” Americans were growing more comfortable with some extremes in pay. Payoffs for the stars on Wall Street, in the movies and in pro sports were rising.

But back in the ’70s, something was holding executive salaries back.

Harold Geneen, the president of ITT, then one of the nation’s largest companies, told Forbes in 1975 that while he might be worth six times as much to the company as he was making, he hadn’t sought a raise.

“No one moved up there, and I didn’t dare do it alone,” he explained.

Over at Dean Foods, Kenneth Douglas was likewise resistant to making more. Most years, board members at Dean Foods wanted to give Douglas a raise. But more than once, Douglas, a former FBI agent who literally married the girl next door, refused.

“He would object to the pay we gave him sometimes — not because he thought it was too little; he thought it was too much,” said Alexander J. Vogl, a members of the Dean Foods board at the time and the chair of its compensation committee. “He was afraid it would be bad for morale, him getting a big bump like that.”

“He believed the reward went to the shareholders, not to any one man,” said John P. Frazee, another former board member. “Today we get cults of personality around the CEO, but then there was not a cult of personality.”

Outside one of the Dean Foods dairies recently, the workers at the plant for the most part only rolled their eyes when asked about Engles’s salary. But they spoke admiringly of Douglas.

“People back then thought enough was enough,” said Ron Smith, 63, who maintains the machines at the plant.

Some were reluctant to criticize Engles to a reporter. Others defended him.

“You’re king of the hill, and you get paid for that,” said Ray Kavanaugh, 61, who operates a filler at the dairy. “He’s worth it if he keep the company making money.”

The employees said they only occasionally dwell on Engles’s riches, anyway. Their primary focus is on making ends meet, they said.

Joe Bopp, 55, said he has a second job taking care of a cemetery during the summer months, mowing the grass and digging graves.

“Twenty-three dollars an hour sounds like a lot of money,” he said. “But when you pay $4 a gallon for gas and $3.29 for a gallon of milk, it goes away real fast.”

Friday, June 17, 2011

Weiner's Fabulous Retirement Perks

Anthony Weiner may be resigning, but he's entitled—for the rest of his life—to a pension, quality health care, and a parking space on Capitol Hill.

Rep. Anthony Weiner may be resigning in shame, but he’ll leave Capitol Hill with the same golden parachute afforded to all members of Congress who leave public service.

Having been in Congress since 1999 and a staffer in the '80s, Weiner will be eligible for a congressional pension of up to $46,224 each year, according to the National Taxpayers Union, which calculates all congressional pensions. He’ll eventually be eligible to collect the balance of his Congressional Thrift Savings Plan, which is currently $216,011. And he’ll be able to keep his high-quality health-care package, at his own expense, until November 2012.

Congressional pensions are considered extremely generous. A member becomes fully vested after five years, and pays only 20 percent of his own benefits (the other 80 percent comes from taxpayers). At 46, Weiner is not yet eligible for his pension, but he’ll be allowed to access a portion when he turns 56, or the full amount if he waits until he’s 62.

Weiner will also be entitled to other perks and privileges even after stepping down. Former members (except those who become lobbyists) are given access to the House floor during regular business or joint sessions, meaning Weiner could attend speeches by the president or foreign heads of state who address joint sessions.

He’ll have the option to buy his office furniture ($1,000 for desks, $500 for chairs) and all of his tech equipment (phones, fax machines, refrigerators).

For life, Weiner will get free parking on the House side of the Capitol (on a space-available basis, the rules say). For 90 days, he’ll be able to send mail for free, so long as it relates to his congressional duties.

Not to mention that for the rest of his life, Weiner will have access, for a small fee, to the congressional gym where he took photos of himself that he sent to women online.

Of course Weiner may also leave a sizable bill for the state of New York—a bill for a special election to choose his replacement. Election costs depend on local variables, like how many polling stations are needed and whether it can piggy-back on the ballot of a previously planned election.

For the rest of his life, Weiner will have access, for a small fee, to the congressional gym where he took photos of himself that he sent to women online.

The New York special election to replace Rep. Chris Lee, the Republican lawmaker who also resigned after sending half-nude photos online, was expected to cost $1 million.
Rep. Eric Massa's 2010 resignation, also in New York, cost taxpayers about $700,000.
Replacing Rep. Jane Harman (who now sits on the board of the Newsweek/Daily Beast Company) was expected to cost California taxpayers $1.5 million for a special election, according to an estimate by the Los Angeles County Registrar.

Epistemology and the End of the World

Epistemology and the End of the World

The Stone is a forum for contemporary philosophers on issues both timely and timeless.
In the coming weeks, The Stone will feature occasional posts by Gary Gutting, a professor of philosophy at the University of Notre Dame, that apply critical thinking to information and events that have appeared in the news.


Apart from its entertainment value, Harold Camping’s ill-advised prediction of the rapture last month attracted me as a philosopher for its epistemological interest. Epistemology is the study of knowledge, its nature, scope and limits. Camping claimed to know, with certainty and precision, that on May 21, 2011, a series of huge earthquakes would devastate the Earth and be followed by the taking up (rapture) of the saved into heaven. No sensible person could have thought that he knew this. Knowledge requires justification; that is, some rationally persuasive account of why we know what we claim to know. Camping’s confused efforts at Biblical interpretation provided no justification for his prediction. Even if, by some astonishing fluke, he had turned out to be right, he still would not have known the rapture was coming.

The recent failed prediction of the rapture has done nothing to shake the certainty of believers.

Of particular epistemological interest was the rush of Christians who believe that the rapture will occur but specify no date for it to dissociate themselves from Camping. Quoting Jesus’s saying that “of that day and hour no one knows,” they rightly saw their view as unrefuted by Camping’s failed prediction. What they did not notice is that the reasons for rejecting Camping’s prediction also call into question their claim that the rapture will occur at some unspecified future time.

What was most disturbing about Camping was his claim to be certain that the rapture would occur on May 21. Perhaps he had a subjective feeling of certainty about his prediction, but he had no good reasons to think that this feeling was reliable. Similarly, you may feel certain that you will get the job, but this does not make it (objectively) certain that you will. For that you need reasons that justify your feeling.

There are many Christians who are as subjectively certain as Camping about the rapture, except that they do not specify a date. They have a feeling of total confidence that the rapture will someday occur. But do they, unlike Camping, have good reasons behind their feeling of certainty? Does the fact that they leave the date of the rapture unspecified somehow give them the good reason for their certainty that Camping lacked?

An entirely unspecified date has the advantage of making their prediction immune to refutation. The fact that the rapture hasn’t occurred will never prove that it won’t occur in the future. A sense that they will never be refuted may well increase the subjective certainty of those who believe in the rapture, but this does nothing to provide the good reasons needed for objective certainty. Camping, after the fact, himself moved toward making his prediction unrefutable, saying that May 21 had been an “invisible judgment day,” a spiritual rather than a physical rapture. He kept to his prediction of a final, physical end of the world on October 21, 2011, but no doubt this prediction will also be open to reinterpretation.

Believers in the rapture will likely respond that talk of good reasons and objective certainty assumes a context of empirical (scientific) truth, and ignores the fact that their beliefs are based not on science but on faith. They are certain in their belief that the rapture will occur, even though they don’t know it in the scientific sense.

But Camping too would claim that his certainty that the rapture would occur on May 21, 2011, was a matter of faith. He had no scientific justification for his prediction, so what could have grounded his certainty if not his faith? But the certainty of his faith, we all agree, was merely subjective. Objective certainty about a future event requires good reasons.

Given their faith in the Bible, believers in the rapture do offer what they see as good reasons for their view as opposed to Camping’s. They argue that the Bible clearly predicts a temporally unspecified rapture, whereas Camping’s specific date requires highly questionable numerological reasoning. But many Christians—including many of the best Biblical scholars—do not believe that the Bible predicts a historical rapture. Even those who accept the traditional doctrine of a Second Coming of Christ, preceding the end of the world, often reject the idea of a taking up of the saved into heaven, followed by a period of dreadful tribulations on Earth for those who are left behind. Among believers themselves, a historical rapture is at best a highly controversial interpretation, not an objectively established certainty.

The case against Camping was this: His subjective certainty about the rapture required objectively good reasons to expect its occurrence; he provided no such reasons, so his claim was not worthy of belief. Christians who believe in a temporally unspecified rapture agree with this argument. But the same argument undermines their own belief in the rapture. It’s not just that “no one knows the day and hour” of the rapture. No one knows that it is going to happen at all.

Thursday, June 16, 2011

Can You Guess Which City In America Has The Most Sex?

Trojan has just released the results of its annual "sex census," and good news for the people of Los Angeles -- they're having more sex than anyone else in the country, an average of 135 times per year.

But that doesn't necessarily mean the sex is any good. Philadelphians report the highest levels of sexual satisfaction, with 82% of respondents there saying they are sexually fulfilled. Just 75% of Angelenos said the same.

Regionally, the Northeast comes out on top -- people there have sex an average of 130 times per year, compared to folks in the West, where the average is 120, and the South, where the average is just 114.

Northeasterners are also the safest, with 43% saying they use a condom during sex.

The results of the census are based on two surveys conducted by a market research firm. The first was a national survey of 1,000 adults conducted online, and the second was an online survey of around 2,000 adults in 10 major U.S. cities.