Month: February 2011

Deep Thought

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Not blogging tonight, because I am dealing with installing Windows 7, SP 1 on this machine, and installing a new printer/scanner/fax (It was as cheap as a flatbed scanner, but came with a document feed, so even though we won’t be using either the fax or printer, it made sense) on the desktop.

At time like this, I think, “F%$# it, I should get myself a Macintosh.”

But then reality hits, and I realize that I’m already way too arrogant and obnoxious, and if I got a Mac, I’d make Muammar Qaddafi look Mahatma Ghandi.

Credit Ain’t Due Here…

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The Obama administration has finally repealed the Bush Administration’s “Conscience Rule,” which allowed healthcare providers to refuse to provide service on moral grounds:

The decision guts one of President George W. Bush’s most controversial legacies: a rule that was widely interpreted as shielding workers who refuse to participate in a range of medical services, such as providing birth control pills, caring for gay men with AIDS and performing in-vitro fertilization for lesbians or single women.

Friday’s move was seen as an important step in countering that trend, which in recent years had led pharmacists to refuse to fill prescriptions for the emergency contraceptive Plan B, doctors in California to reject a lesbian’s request for infertility treatment, and an ambulance driver in Chicago to turn away a woman who needed transportation for an abortion.

Bush implemented this toward the end of his term, and it took Obama 2 years to repeal it?

Well, it appears that they wanted to split the difference yet again:

Soon after Obama assumed office, administration officials said they agreed the regulation was too broad and announced plans to rescind it. But officials indicated that instead of simply invalidating the rule, they would seek to replace it with a compromise. The announcement triggered more than 300,000 comments, which officials have spent months reviewing. The Federal Register notice announcing the decision cites concerns raised by both sides in the comments but concludes that most of the provisions were unnecessary and potentially problematic.

The rule will retain a provision that empowers the HHS Office of Civil Rights to investigate any complaints by workers who believe their rights under existing federal law were being violated. The office is currently investigating a complaint from a nurse who claims she was forced to perform an abortion in New York.

I think that crap like this comes from the top, and I think that Barack Obama is personally opposed to a woman’s right to choose, but finds the politics unavoidable, so feet are dragged, until the absolute minimum is begrudgingly done.

Very weak tea, and the absolute minimum that Obama could do without engendering a backlash from the base.

Now We Know What Gives Timothy Geithner an Erection

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Noam Scheiber interviewed Geithner, and gave us this gem:

I asked Geithner if he had a grand vision for the postcrisis landscape—for, say, a less bloated financial sector with a smaller role in the economy—and a map for how to get there. Could he be a figure like George Marshall, who helped win the World War and then remade Europe so that it couldn’t happen again?

Geithner hunched his shoulders, pressed his knees together, and lifted his heels up off the ground—an almost childlike expression of glee. “We’re going, like, existential,” he said. He told me he subscribes to the view that the world is on the cusp of a major “financial deepening”: As developing economies in the most populous countries mature, they will demand more and increasingly sophisticated financial services, the same way they demand cars for their growing middle classes and information technology for their corporations. If that’s true, then we should want U.S. banks positioned to compete abroad.

“I don’t have any enthusiasm for … trying to shrink the relative importance of the financial system in our economy as a test of reform, because we have to think about the fact that we operate in the broader world,” he said. “It’s the same thing for Microsoft or anything else. We want U.S. firms to benefit from that.” He continued: “Now financial firms are different because of the risk, but you can contain that through regulation.” This was the purpose of the recent financial reform, he said. In effect, Geithner was arguing that we should be as comfortable linking the fate of our economy to Wall Street as to automakers or Silicon Valley.

And then he smoked a cigarette, and asked if was good for me.

H/t David Dayen.

Sorry for that image.

He’s Not Just CIA, He’s Blackwater

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And it appears that he was working as a contractor for the CIA, and former, and perhaps currently, worked for Blackwater or Xe.

It should also note that the New York Times has been told by the government that it has permission from the US government to confirm his CIA connections.

Permission from the government? Whiskey Tango Foxtrot? (Glenn Greenwald is somewhat more articulate on this issue.)

So he’s a contractor, and considering his background, perhaps the appellation “mercenary” would be appropriate, said the contractor (working as an engineer, not a shooter).
In any case, the fact that they are admitting this means that both CIA and the State Department are very worried about this.

Libya is Burning

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I don’t have much to add, so I’ll point you to the Guardian.

It’s clearly an end game:

  • Two pilots were ordered to bomb protesters, and defected to Malta.
  • Border guards are abandoning their posts.
  • Reports of naval fire and aerial bombardment of some neighborhoods in Tripoli.
  • Bizarre statements from Qaddafi and his son(s).

 This is not going to be pretty, but it is completely outside of my intellectual strengths, such as they are.

Unfortunately, unlike Egypt, there are not a lot of press on the ground, so what is coming out is sketchy.

A Non-Surprise About the Most Over Rated Man in America

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When Colin Powell spewed his lies about Saddam Hussein and weapons of mass destruction, his staff had already warned him that the information was complete crap.

In one case, he personally made up dialog that did not exist, and in others, he used reports that flagged the data as “Weak” and “not credible”.

Not a surprise.

Here is hoping that at some point in the not-too-distant future, Powell’s reputation experiences the same sort of reevaluation that Alan “Bubbles” Greenspan has.

Mozilo Skates…

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The Department of Justice, no doubt looking forward rather than backward, had dropped its criminal investigation of former Countrywide CEO Angelo Mozilo:

Federal prosecutors have shelved a criminal investigation of Angelo R. Mozilo after determining that his actions in the mortgage meltdown — which led to $67.5-million settlement against him — did not amount to criminal wrongdoing.

As the former chairman of Countrywide Financial Corp., Mozilo helped fuel the boom in risky subprime loans that led to the crippling of the banking industry and the near-collapse of the financial system.

A federal grand jury in Los Angeles began probing Mozilo in 2008, and four months ago he agreed to pay a $22.5-million fine and to repay $45 million in what the government said were ill-gotten gains to former Countrywide shareholders. The payments settled a civil action by the Securities and Exchange Commission.

As Atrios notes, what this really means is that if you want to run a criminal enterprise, make sure that everyone has a piece of it, because, “If Everybody Is Guilty Then Nobody Is.”

Matt Taibbi is right, our society is now run by people who have declared criminals to be untouchable before the law.

More Adventures of People with Small Penises in the Pentagon

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The USAF is looking for a 2000 lb missile replacement for its 5000+ lb guided free-fall bombs for bunker busting and the like, to quote Shrek, I think that someone is compensating:

Penetrate faster, harder with new AFRL weapon

……………
An Air Force Research Laboratory fact sheet with a 2011 time-stamp for public release approval tells us that a 2,000lb-class weapon with 5,000lb-class penetration capability could be available within three years.
“Future fighters will be able to deliver bunker-busting capabilities currently associated with the bomber fleet,” the fact sheet says.
I found the fact sheet for the High Velocity Penetrating Weapon (HVPW) in the AFRL munitions directorate booth at the Air Warfare Symposium a few days ago. The document reveals the USAF has shifted its focus on next-generation penetrator technology on a couple of different levels.

The folks at the USAF do seem to spend a suspiciously large amount of time talking about “penetrators”, don’t they?

BTW, running the numbers, the kinetic energy of a 2500 kg system at 300 m/s (about 650 mi/h), is 112.5 MJ, so for a 1000 kg system, you would need a velocity of only (475 m/s) 1800 m/s km/h (1080 mi/hr) to get the same kinetic energy.
(added correction in red  D’oh!!!)

Development Costs of F135 Rise, Marginal Unit Cost Falls

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The Pentagon and Pratt & Whitney have negotiated a cost reduction for the next 37 engines that they deliver, but the non-recurring R&D Costs go up:

Pratt & Whitney has reached an informal agreement with government officials to slash 16% off the total price of the next batch of 37 engines to be ordered for the Lockheed Martin F-35 Joint Strike Fighter.

At the same time, the company acknowledges the cost of the overall F135 engine development programme will grow by about $1 billion to support a three-year extension of flight tests and to improve the engine’s performance and durability.

If you assume $15 million per engine, it means that this cost, assuming that this continues across the production run (it won’t, particularly with the GE/Rolls F136 out of the picture) would end up saving money after the delivery of about 450 engines.

This is taking money out of one pot, and add it to another in the best case, and more likely it’s a stealth price increase.

Here’s a Shocker

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Wisconsin Governor Scott Walker was bankrolled by the Koch brothers Josef Stalin derived fortune:

Wisconsin Republican Governor Scott Walker, whose bill to kill collective bargaining rights for public-sector unions has caused an uproar among state employees, might not be where he is today without the Koch brothers. Charles and David Koch are conservative titans of industry who have infamously used their vast wealth to undermine President Obama and fight legislation they detest, such as the cap-and-trade climate bill, the health care reform act, and the economic stimulus package. For years, the billionaires have made extensive political donations to Republican candidates across the country and have provided millions of dollars to astroturf right-wing organizations. Koch Industries’ political action committee has doled out more than $2.6 million to candidates. And one prominent beneficiary of the Koch brothers’ largess is Scott Walker.

Seriously, these guys are to the conservative wackdoodle movement as Gaëtan Dugas was to AIDS.

*No seriously, Koch Industries made its money building refineries for Josef Stalin.

U.S. Vetoes UN Resolution On Settlements

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This is rather unsurprising.

I favor a 2 state solution, one along the other ethnic separations out there, which means parts of pre-1967 Israel will become a part of a future Palestinian state, because at it’s core what is going is is negotiations over ethnic land divisions, and under those terms, some areas near the West Bank, and parts of the Galilee which are overwhelmingly Arab, would necessarily move in that direction.

Whether or not this sort of separation occurs, full rights should be extended to non-Jews, by which I mean something along the lines of the US civil rights act, prohibiting discrimination on the basis of ethnicity.

Another full right that should be extended to the non Jewish (and non Druze) population in Israel is conscription: As it stands now Arabs are not required to serve, which, among other things, prevents the formation of social ties that normally occur during mandatory service, and which frequently help in later life. (aka “Old school ties).

As to the veto, I am increasingly of the opinion that any foreign involvement in the diplomacy between the Palestinian government and Israel is counter-productive, because it leads the negotiators to spend too much time playing to outside entities, whether it be the US, UN, EU, or Arab governments, and not enough dealing with each other.

One reality here that needs to be accepted is that at some point in the next few decades, Hamas will win an election (they already have) and take power (they weren’t allowed to after the election).

This may be scary, but the current principals in this matter need to suck it up and accept reality.

Because It Worked So Well in Egypt

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Libya has cuts off the Internet:

Internet service has been cut off in Libya for a second consecutive day as protesters step up demonstrations against longtime leader Muammar Gaddafi, a U.S. company that monitors Internet traffic said on Saturday.

Massachusetts-based Arbor Networks said data collected from 30 Internet providers around the world showed that online traffic in and out of Libya was disconnected abruptly at 7:15 p.m. EST on Friday after two partial interruptions earlier that day.

I kind of figured that Bahrain would go first, because it’s a predominantly Shia country ruled by a Sunni king, but I may have been wrong.

I Predicted This 12 Years Ago

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The Pentagon has killed the MEADS surface to air missile system:

The Pentagon announced today it would kill MEADS, an anti-missile program once declared the highest priority weapon system for the United States and its allies to build together.

The Army has tried several times before to kill the program, which uses the Patriot interceptor, but has always been overruled before by the Office of Secretary of Defense. Germany and Italy have made major political and industrial commitments in pursuit of MEADS and they will doubtless let America know just what they think of this decision.

I did some very preliminary work on MEADS about 12 years ago. Essentially, because, unlike the PAC-3, it did not exactly need to have 4 missiles to fit in a 4-pack that had the same form, fit, and function as the larger Patriot PAC-2, which allowed for some logistical enhancements.

At the time, I said that the program was doomed, because it was a multinational program, and, like the Roland SAM, it would be dropped by the US military, because the opportunities for cushy consulting gigs for retired generals would be too small.

I was right, and I am not alone in my jaundiced assesment of the decision:

To get expert perspective on MEADS’ demise, we contacted Frank Cevasco, one of the top international defense consultants and someone who has closely followed MEADS for more than a decade. While a senior Pentagon official he and colleagues at OSD pushed the Army to create a program office to manage a future extended air defense program, which eventually became MEADS. He said he does not represent any of the companies involved in the program.

Cevasco said at least part of the cost overrun can be attributed to a plan to replace Patriot with MEADS on a one-for-one basis. “I was told that doesn’t make sense as a MEADS fire unit has substantially greater geographic coverage than Patriot. I agree there would be additional costs associated with integrating MEADS with a separate Army command and control system, a requirement that was levied on the program unilaterally by Army about two years ago. Moreover, a portion of the cost overruns and schedule slippages can be attributed to the Army and DoD technology disclosure community who refused to allow the MEADS industry team to share key technology. The matter was resolved but only after intervention by senior OSD officials and the passage of considerable time; and, time is money with major weapons system development programs,” he said in an email.

Bottom line for Cevasco: “Army has done its best from the every beginning to sabotage the program, preferring to develop a US-only solution funded by the US (with funds provided by the good fairy).”

The military funds fairy is named either Obama or Gates, your choice.

Big Surprise: Boeing’s 787 Outsourcing Cost Money Instead of Saving It

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To the tune of billions of dollars:

The airliner is billions of dollars over budget and about three years late. Much of the blame belongs to the company’s farming out work to suppliers around the nation and in foreign countries.

It should be noted that aircraft manufacturers do not make money off of the sales of aircraft, but rather on spares and support down the road, and in outsourcing, Boeing has thrown that revenue stream to its suppliers, an act that Atrios calls, “obviously insane,” additionally, it makes the entire process of creating an aircraft more riskier, because you have less control over whether tab A fits in slot B, or, as Felix Salmon notes, it’s like, “picking up pennies in front of a steamroller“.

Boeing was told that this was an issue by a senior fellow, L.J. Hart-Smith in 2001, (also here, where the PDF cuts and pastes better) and but chose to ignore it:

The inescapable problem with outsourcing work that could be done in-house is that it necessarily increases the tasks and man-hours to carry out the work way above those needed to perform all assembly, including most subassemblies, at one site. Experience in the electronics industry has shown that out-sourcing work to regions of low labor rate is only a transitory phenomenon. The reason why the rates were low was that there had previously been no work there. Once the work became available, hourly rates increased, so that the primary electronic companies kept moving the work to yet another as-yet-under-developed area, and the cycle was repeated. This may be cost-effective for small items, with production lives of only a few years at most, but it is inappropriate for large aircraft that may need spare parts throughout a service live in excess of 50 years (80 or more for some military aircraft) and for which the manufacturing program itself may last 40 or 50 years. There are so many aircraft components that must be out-sourced, such as engines, avionics, and systems, because today’s prime aircraft manufacturers are no longer equipped to undertake such work themselves, that the retention of a determinable minimum fraction of the structures work is a pre-requisite to developing sufficient cash to develop new products. Without new products, as distinct from derivatives, all companies will go out of business, no matter what their line of business.

The correctness of the author’s position on these matters is easily confirmed by two facts. It was the suppliers who made all the profits on the extensively out-sourced DC-10s, not the so-called systems-integrating prime manufacturer. (The same thing has happened on aircraft assembled by Boeing, in Seattle, too.) Also, when plans were being formulated for the proposed MD-12 very large transport aircraft, almost all potential suppliers indicated a preference for being subcontractors rather than risk-sharing “partners”. Could they have known more about maximizing profits, minimizing risk, etc., than the prime manufacturer who sought their help even though it could borrow money at lower rates of interest than potential suppliers could? The DC-8 was manufactured and assembled almost entirely within the Long Beach plant, with only the nose coming from Santa Monica. That policy was changed after the acquisition of the former Douglas Aircraft Company by the former McDonnell Aircraft Company, but the change did not improve the company’s profitability. It is time for Boeing to reverse this policy.

(emphasis original)

So, McDonnell, a company which was a complete failure in the commercial arena (only 1 project, a failed bizjet), took over what was the number two (and had been the number 1) commercial aircraft manufacturer in the world, and implemented its defense contracting monopsony* driven business model, where it failed, and then Boeing bought McDonnell Douglas, and implemented their failed business model.

Boeing bought MACDAC, but MACDAC took over Boeing, and set the tone for its corporate culture, despite the fact that it was largely a failed company, having lost the JSF competition, and having only 2 major programs that it had initiated, the F-15 and the C-17 over the past 30+ years (the F/A-18 was initiated by Northrop).

One good thing that has come of this is that it will make a fascinating case study for the size of operations for economists, as Paul Krugman rather smugly notes:

In Boeing’s case, they outsourced far too much, only to find that they were getting parts that didn’t do what they were supposed to — and also to find that the subcontractors were seizing a lot of the rents. They discovered, in effect, that there are times when it’s better to rely on central planning than to leave things up to the market.

Obviously this isn’t always true. There’s a tradeoff. But that’s the point — and it’s this tradeoff that determines how big firms should be. Boeing has now provided a clear motivating example. Their loss, the economics profession’s gain.

Heh.  Here’s hoping that I’m never a good case study for some academic.

*A monopsony is the flip side of a monopoly. Instead of having only one seller and many buyers, a monopoly, you have only one buyer and many vendors, in McDonnell’s case, the US military.

House Votes to Kill F136 Engine

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While I expect to see some continued efforts by GE, Rolls Royce, and their supporters, I think that this is the death knell for the F136 engine:

The U.S. House of Representatives today voted to kill funding the F-35 Joint Strike Fighter backup engine made by General Electric Co. and Rolls Royce Group Plc.

By a vote of 233-198, the House voted to cut $450 million for the engine from legislation funding the Pentagon for the remainder of the fiscal year ending Sept. 30.

It is the first time in more than four years of votes that the House has come out against the GE-Rolls Royce engine for the F-35, the stealth fighter made by Lockheed Martin Corp. In May, 2010, the House voted 231-193 to continue the program.

This is important for a number of reasons.

First, with this defeat on the table, the onus now falls on the supporter of the F136 to bring the engine back, which is hard.

Second, and more importantly, House Speaker John Boehner, whose district, and neighboring districts, directly benefit from the engine, could not whip the votes necessary to support the engine.

Like I said, the engine is toast.

In the long run, this is a bad thing, because leaving Pratt & Whitney as a monopoly supplier for the engine is likely to increase costs, and reduce performance, a lot down the road.

That being said, I do experience no small amount of amusement because Boehner got seriously served on this.