Michael Pettis Nails 12 Predictions on the Gate to the Forbidden City

Beijing-based economist Michael Pettis is now making public 12 daring predictions regarding the near-to-intermediate term economic future of China. For those hoping for China to lead the world into a bright new economic recovery, the predictions make for sour reading.

1. China will be the last major economy to emerge from the global crisis. My basic argument was that the global crisis was caused by the necessary reversal of the great trade and capital imbalances of the past decade, and a country can only be said to have emerged from the crisis when those underlying imbalances had been resolved.

Since China’s contribution to the global imbalances has been its excessively high savings rate, China could not emerge from the crisis until the high savings rate had been reduced to a more reasonable level.　Since 2007-08, of course, the opposite has happened, as Beijing has exacerbated its domestic imbalances in order to keep growth rates high.　 But without infinite debt capacity this cannot go on.　 I think it is pretty clear that over the next few years China will be forced to address and reverse the high savings rate, and it will only be after this happens that China can be said to have emerged from the crisis.　 This may take a decade or more.

2. Chinese consumption will continue to stagnate or decline as a share of GDP until the growth model is abandoned.　 By “abandoning” the model I mean that transfers from the household sector to subsidize rapid growth must be eliminated and reversed.　

This is really a continuation of the first prediction.　 It is too early to say, but 2012 may be the first year in which consumption growth will outpace GDP growth, but only if GDP growth turns out to be much lower than expected – say below 7%.　 As long as GDP growth rates exceed 7%, there can be no real rebalancing of consumption.

3. Although there were many factors that explained both rapidly rising GDP and the contracting consumption share, financial repression would eventually be recognized to be the key factor.　 It took many years to make this point, but it has become pretty clear to everyone that financial repression is at the heart of China’s problem.　 This may explain Premier Wen’s recent and rather shocking attack on the banks, although in my opinion it will still be at least another year or two, if ever, before we see any real liberalization of interest rates.　

Remember that the more debt there is, the harder it is to raise interest rates, and the longer we take to raise interest rates, the more debt we run up.　 In the end I suspect that financial repression will be eliminated not by an increase in nominal rates but rather by a decline in GDP growth (remember that the size of the financial repression tax is a function of the difference between nominal GDP growth and the nominal lending rate).

4. Investment is being misallocated on a massive scale and this was not due to any special Chinese characteristic but was rather a fundamental requirement of the way the system operated. Although there are still some economists who disagree that investment is being massively wasted, I think this is so well understood by now that there is no need to belabor the point.

5. Debt is rising at an unsustainable pace and debt levels will become unsustainable well before the end of the decade.　 This follows from the above point – if investment is debt funded and if it is being wasted, then by definition debt must be increasing at an unsustainable pace – i.e. faster than debt-servicing abilities.

I suspect nonetheless that in another year or two no one will doubt that the Chinese growth model tends towards unsustainable debt and that we are rapidly reaching the limit.

6. When specific debt problems are identified, resolute attempts by Beijing to resolve them would be warmly welcomed by analysts but wholly irrelevant – because the problem of debt was systemic, not specific.　 This follows from the above.　 The issue is not that specific borrowers may run into debt problems.　 It is that the run-up in debt is systemic and cannot be prevented as long as China maintains the existing growth model.　 If there is rapid GDP growth, say anything above 6% or 7%, debt within the system must be rising at an unsustainable pace.

7. Privatization, a topic all but forbidden in polite company, would become a very hot topic of conversation by 2013-14.　 I have discussed why in this issue of the newsletter.

8. As some policymakers gradually became aware of the problem with the growth model and the risk of crisis, a fundamental political split would emerge between those that demanded rapid reform and those that wanted to maintain control of resources.　 The problem is that continuing the growth model will lead to a debt crisis, but abandoning the model will lead to much slower growth, and especially to much slower growth in the accumulation of state sector assets.　 This is politically very difficult for many to accept and will lead to more political conflicts over the next few years.

9. Chinese government debt will continue to balloon through the rest of this decade.　 Privatization is the best way to effect the transfer of wealth from the state sector to the private sector, and would be especially efficient if privatization proceeds were used to extinguish debt, but for the reasons discussed above it will be extremely difficult to do it.　 This means that debt build-up and the state absorption of private sector debt will continue for many years.

10. If the transition is not mismanaged, average Chinese GDP growth rates will drop to 3% for the 2010-20 decade.　 As my bet with The Economist suggests, this is one prediction that is still an outlier.　 The Economist(and many others) still believe that Chinese growth will make it the largest economy in the world before the end of the decade, but much slower growth is what rebalancing requires and it is hard to make the numbers work at growth levels much above 3%.　 By the way if I am wrong and Chinese growth this decade is materially higher than 3%, my prediction is that the “lost decade” of much lower growth stretch out over two decades.

11. If China rebalances correctly, then much slower GDP growth rates will be accompanied by only slightly slower growth rates in household income.　 In that case there need be no social instability.　 The political risk comes from instability at the top, not at the bottom.

12. Non-food commodity prices are set to collapse over the next three to four years.　 “Collapse” is not too strong a word.　 China’s share of global demand for such commodities as iron, cement, copper, etc. is completely disproportionate to its size and almost wholly a function of its very high growth in investment. 　As investment growth drops sharply, as it must, global demand for non-food commodities will plummet. _Michael Pettis via Mish

Hedge funds cut commodity bets on slowing China growth

This is what Pettis has been saying all along, although he typically does not spell things out this way.

More: Interesting background and supporting information for the pathologically curious from Zarathustra

Revolutions in Online Learning

Memrise -- A fun new way to learn. Visit the site to play around a bit with the unique memrise approach.

Our recipe for effortless learning has 3 simple ingredients:

The first is Science. We're obsessed with using brain science to help you learn faster. This isn't a marketing ploy- we're really experts in this stuff. And from day one we've built Memrise to embody the very best knowledge about how your brain works, and so help you learn as quickly and effortlessly as possible.

We use 'mems' to help you form vivid, sensory memories. We test you continuously, always making sure to give your brain just the right workout. We remind you of what you've learned at scientifically optimized times so your memories are always growing stronger, and never forgotten.

The second is Fun. We want to make learning your favourite playtime activity. That's how it should be: we learn best when we're relaxed, curious and confident, and, after all, the world is a very interesting place.

So we've turned learning facts and language into a game where you grow a colourful garden of memory. You grow and water your memories in a garden of memory, you zoom up the leaderboards, and you learn alongside your mempals. It's like a guiltless video-game.

The third is Community. We believe learning should be as rich and varied as the world you're learning about. So with our community we're building a kind of multimedia wonderland of learning, where videos, audio, usage, mnemonics, etymologies and much more bring your learning to life.

We believe that every learner is partly a teacher, and we hope that once you get started, you'll soon be supplying little nuggets of wit and wisdom to help the rest of the community as they learn! _Memrise

h/t Wired

Here are some other relatively new approaches to online learning:

Udacity
When Stanford professor Sebastian Thrun posted a free AI course online last year, it attracted more than 160,000 students from 190 countries. The experiment prompted Thrun and two other roboticists to launch the for-profit online "college", Udacity. Courses offered include Building a Search Engine and Programming a Robotic Car.
udacity.com

Codecademy
Launched by Y Combinator graduates Zach Sima and Ryan Bubinski in August 2011, Codecademy teaches people how to program in multiple computing languages quickly, easily and for free. Their approach teaches by talking students through the processes -- you write code while being led through the basic principles.
codecademy.com

OpenLearn
UK-based distance-learning institution the Open University joined the democratic education wave in 2006 with OpenLearn, a website that provides free global access to the OU professors' learning materials. This includes more than 600 courses divided into topics spanning from Body & Mind to Money & Management. open.edu/openlearn

TED-Ed
TED wants its ideas to spread even further, to "brains that aren't fully wired yet", according to curator Chris Anderson. The TED-Ed hub combines instructional videos with interactive content and lesson plans designed by educators. Teachers can submit audio lessons to the site: the best recordings will be turned into new videos and win their maker $1,000.
education.ted.com

The Khan Academy
The Khan Academy was founded by MIT engineering graduate Salman Khan in 2006. The website supplies free first-person tutorials on subjects as varied as economics, art history and computer science. Financial donors to the academy include the Bill & Melinda Gates Foundation, Google and the O'Sullivan Foundation.
khanacademy.org

...The idea that new technology could open up higher education to a mass audience is not a new one. In 1926, John Stobart, director of education at the BBC, wrote a letter to the corporation's director general, John Reith, describing a new idea that he called "the wireless university". Stobart started with a question: "Are we to place broadcasting at the disposal of the various existing universities, or are we going to break out on a new trail of our own?" He complained that those current courses had "grown out of various historical sources such as the medieval trivium in the older universities". Citing the "ubiquity" of radio, Stobart wrote that the "wireless university, working under its different conditions, should, as far as possible, break away from tradition."

...[Sebastian] Thrun, inspired by the ubiquity and interactivity of the web, would set about turning Stobart's fantasy into reality. Back at Stanford after TED, he dusted off a PowerPoint presentation he'd put together in 2007. Back then he had begun envisioning a YouTube for education, a for-profit startup that would allow students to discover and take courses from top professors. In a few slides, he'd spelled out the nine essential components of a university education: admissions, lectures, peer interaction, professor interaction, problem-solving, assignments, exams, deadlines and certification. Although Thrun admired MIT's OpenCourseWare -- the university's decade-old initiative to publish online all of its lectures, syllabi and homework from 2,100 courses -- he thought it relied too heavily on videos of actual class- room lectures. That was tapping just one-ninth of the equation, with a bit of course material thrown in as a bonus.

Thrun knew first-hand what it was like to crave superior instruction. When he was a masters-degree student at the University of Bonn in Germany in the late 80s, he found his AI professors to be lacking. He spent a lot of time filling in the gaps at the library, but he longed for a more direct connection to the experts. Thrun created his PowerPoint presentation because he understood that university education was a system in need of disruption. But it wasn't until he heard Khan's talk that he thought he could do something about it. He spoke with Peter Norvig, Google's director of research and his CS221 coprofessor, and they agreed to open up their next class. _Wired

Read the Wired article for more links and references to online learning approaches.

It may be fortuitous that we are entering such a fertile period of online learning revolutions at the same time that the higher education bubble in the US is reaching critical proportions.

Trayvon's Tragic Trajectory: An Ethnic Community in Trouble

Cross-posted from abu al-fin

The tragic shooting of teenager Trayvon Martin in Florida has exposed the sad trajectory of entire generations of African American youth. Like so many young blacks, Trayvon emerged from a broken home, in an atmosphere where gangsta rap and gangsta-ism are the most prominent influences on young and formative minds.

Here is one aspect of the US black community which is often overlooked: The epidemic of fatherlessness and lack of non-criminal role models --

• 70% of all black children are born out of wedlock.
• 65% of never-married black women have children, double that for white women.
• 22% of never-married black women with incomes over $75,000 have children, 10 times that of white women.
• 62% of black families with children are headed by a single parent.
• 85% of black children do not live in a home with their fathers.
• Only 15-20% of black children born today will grow up with 2 parents until age 16.
• Over 80% of long-term child poverty occurs in broken or never-married homes.
• 70% of [black] boys in the criminal justice system come from single-parent homes. _LaShawn Barber_quoting from _A Portrait of the Black Family 2007 (PDF)

Research has demonstrated that crime and delinquency rates among youth raised without fathers, or where the fathers' minds are elsewhere, will be significantly higher on average.

Children are not typically born gangsters. But if the conditions of child-raising push the child in that direction, the trajectory can seem inexorable in hindsight. Parents can be helpless in the undertow of dysfunctional popular and community culture, in these situations. Parental guilt, when things turn out poorly, can be turned to paradoxical and exaggerated behaviours in blaming the "other," for the failures that lie within the family and the community.

All too often, mercenary lawyers and rabble rousers step into such tragic circumstances, and attempt to tip the already unbalanced emotions of a community to their own profit. Such is the case in the Trayvon tragedy, where a fairly straightforward case of self-defense becomes twisted by lawyers, media, and professional rabble into a national cause celebre of purported "racist vigilantism." There is also a curious and illegal $1 million bounty placed on the head of George Zimmerman, the admitted shooter, by the New Black Panther Party militant racialist group.

US President Obama had hoped that this incident would play well in his ongoing campaign for re-election. As it turns out, only by twisting the facts beyond recognition can the US President fit this tragedy into his already absurdly fictional narrative, and continue to obscure the growing tragedy of the US black community under his presidency.

The Black Family ... City Journal

Culture of Poverty .... table of characteristics from Stanford

For things to get this bad, the government had to have been involved . . . Thomas Sowell

STDs including HIV haunt US black communities

Sad reality of "crime and the black community" being covered up despite the promise of an open national discussion on race by Obama

More: Should the entire discipline of statistics be declared racist by governments?

HMGA2 New Gene Candidate for Higher IQ

More 16 April 2012: 3 related studies in Nature Genetics

Joshua C Bis et al. Common variants at 12q14 and 12q24 are associated with hippocampal volume. Nature Genetics, 2012; DOI: 10.1038/ng.2237

M Arfan Ikram et al. Common variants at 6q22 and 17q21 are associated with intracranial volume. Nature Genetics, 2012; DOI: 10.1038/ng.2245

Jason L Stein et al. Identification of common variants associated with human hippocampal and intracranial volumes. Nature Genetics, 2012; DOI: 10.1038/ng.2250

_Source: Sciencedaily

An international team of scientists, including reasearchers from the US and the UK, have discovered a gene that is linked to both larger brain size and higher IQ.

A variant of this gene "can tilt the scales in favour of a higher intelligence", study leader Paul Thompson told AFP, stressing though that genetic blessings were not the only factor in brainpower.

Searching for a genetic explanation for brain disease, the scientists stumbled upon a minute variant in a gene called HMGA2 among people who had larger brains and scored higher on standardised IQ tests.

Thompson dubbed it "an intelligence gene" and said it was likely that many more such genes were yet to be discovered.

The variant occurs on HMGA2 where there is just a single change in the permutation of the four "letters" of the genetic code.

... the researchers found that people with a double "C" and no "T" in a specific section of the HMGA2 gene had bigger brains on average.

"It is a strange result, you wouldn't think that something as simple as one small change in the genetic code could explain differences in intelligence worldwide," said Thompson, a neurologist at the University of California at Los Angeles.

The discovery came in a study of brain scans and DNA samples from more than 20,000 people from North America, Europe and Australia, of European ancestry.

People who received two Cs from their parents, a quarter of the population, scored on average 1.3 points higher than the next group -- half of the population with only one C in this section of the gene.

The last quarter of people, with no Cs, scored another 1.3 points lower. "The effect is small," said Thompson, but "would be noticeable on a (IQ) test ... (it) may mean you get a couple more questions correct.

The research, published in Nature Genetics, was conducted by more than 200 scientists from 100 institutions worldwide, working together on a project called Enigma.

Thompson said other studies have implicated some genes in IQ, but this was the first to link a common gene to brain size.

The team found that every T in place of a C represented a 0.6 percent smaller brain -- equal to more than a year's worth of brain loss through the normal ageing process.

Asked to comment on the research, Tom Hartley, a psychologist at Britain's University of York said he was "a little wary of thinking in terms of a gene for intelligence.

"There are undoubtedly a lot of things that have to work properly in order to get a good score on an IQ test, if any of these go wrong the score will be worse." But he said it was "fascinating" to find that such small genetic changes could affect the size of critical structures such as the hippocampus, the brain's memory centre.

"Given the importance of the hippocampus in disorders such as Alzheimer's disease these could turn out to be very significant findings," said Hartley._AFP

Nature Genetics article preview and figures

More from Eurekalert

More

In other IQ news, high IQ has been linked to high levels of worry.

No one expects human intelligence to be controlled by only one, or just a few, genes. But the anatomy of the brain as well as the physiological processes in the brain that underlie intelligence, are all at least partially determined and controlled by genetic factors. The wealth of discoveries over the past half century, which tie differences in genes to differences in intelligence, are likely to grow richer as the tools of exploration and discovery become more powerful and specific.

Africa Is Not Like Most of the Rest of the World

SubSaharan Africa is different from the rest of the world. Its countries tend to be poorer, more violent, with more disease, less educated and less literate, and much more prolific in terms of birth rates and population growth.

NYT Lagos, Nigeria

Last October, the United Nations announced the global population had breached seven billion and would expand rapidly for decades, taxing natural resources if countries cannot better manage the growth.

Nearly all of the increase is in sub-Saharan Africa, where the population rise far outstrips economic expansion. Of the roughly 20 countries where women average more than five children, almost all are in the region.

Elsewhere in the developing world, in Asia and Latin America, fertility rates have fallen sharply in recent generations and now resemble those in the United States — just above two children per woman. That transformation was driven in each country by a mix of educational and employment opportunities for women, access to contraception, urbanization and an evolving middle class. _NYT

“The pace of growth in Africa is unlike anything else ever in history and a critical problem,” said Joel E. Cohen, a professor of population at Rockefeller University in New York City. “What is effective in the context of these countries may not be what worked in Latin America or Kerala or Bangladesh.” _NYT

Nigeria, like many sub-Saharan African countries, has experienced a slight decline in average fertility rates, to about 5.5 last year from 6.8 in 1975. But this level of fertility, combined with an extremely young population, still puts such countries on a steep and disastrous growth curve. Half of Nigerian women are under 19, just entering their peak childbearing years...

Statistics are stunning. Sub-Saharan Africa, which now accounts for 12 percent of the world’s population, will account for more than a third by 2100, by many projections. _NYT

...contraceptive use is rising only a fraction of a percent annually — in many sub-Saharan African nations, it is under 20 percent — and, in surveys, even well-educated women in the region often want four to six children.

“At this pace it will take 100-plus years to arrive at a point where fertility is controlled,” Dr. Guengant said. _NYT

That evening at the clinic, Bola Agboola, 30, gave birth to her second child. After nurses swaddled the boy, dispensed with the placenta and declared Ms. Agboola well, they whooped, praising God.

Then, as Ms. Agboola’s husband entered, some started another chant: “Now start another one. Start another one.” _NYT

Across the developed world from Japan to South Korea to Spain to Italy, birthrates have plummeted. Instead of 6 children per woman, in many of the most advanced nations of the world, average birthrates have fallen perilously close to only 1 child per woman.

In such countries, it is easy to understand Robert Zubrin's warning against the lefty-green zealots of the overpopulation brigade. Most of the technological and scientific advances that propel us into the future are brought about by persons at the upper end of the IQ curve -- somewhere above 120 in general. The most advanced science is usually pushed forward by persons with IQ's near or above 130.

What Happened to Africa?
It is easy to think that either overpopulation or underpopulation is the greatest danger to humanity. But the truth is more complex and nuanced.

Not all populations of humans achieve the same results, in terms of the societies that they build, and the future ambitions which they are capable of achieving.

In most populations of the Earth, the educating of women, and the achievement of good public health and the meeting of basic needs, is enough to bring birthrates close to equilibrium. But for various reasons, some populations of the planet may resist achieving such a balance.

Some of the maps above contain enough information to tell you what is being compared. For others, you may need to guess between "national GDP", proportion of persons living on less than $1 a day, etc. But by simply skimming over the maps, one can easily see that SubSaharan Africa is not like most of the rest of the world.

If the rest of the world does not wish to become like subSaharan Africa, it may need to devote some thought to the problem. Compassion and basic humanity are generally the best guidelines for such thinking.

h/t NBF

Science and the Wealth of Nations II: Where Science Gets Done

Most people think that science and math and engineering are found everywhere, like soccer, but actually, they are regional practices, more like hurling or tossing the caber. In the map, countries are resized according to the number of scientific papers they produce. Population size plays a role, but average productivity matters more. Note that Singapore, with a population of 5 million, looks bigger than Indonesia, with 240 million people. _West Hunter

Spend a little time with the map below, to receive the full impact of the global situation.

Greg Cochran's West Hunter

Generally the pattern is about what you would expect from the world distribution of IQ (note the correlation with latitude), coupled with the notion that science is generated by people out in the tail of the intelligence distribution. About 2% of a population with an average IQ of 100 scores above IQ above 130, about 0.1% above 145. For a population with an average of 85, only 0.1% will score above 130 – 20 times fewer. _West Hunter

The lower the average IQ of a nation, the fewer the prospects for successful training in science, math, computer science, or engineering. And the less science, math, computer science, and engineering being done in a nation, the more impoverished the nation will be, on average.

Innovation and the Scientific Wealth of Nations
Of course, even in nations of relatively high average IQ, political and cultural forces can suppress science and technology. And when a particular nation gains a large head-start -- as did the US before, during, and after World War II -- it can be hard for other regions to catch up again.

An EU initiative to increase effective R&D spending in 2000 (the "Lisbon Agenda") to gain parity with the US has had limited success, to put it most diplomatically. In a report published Friday (Jan 20), an independent Expert Group commissioned by the EU "urges Europe’s leaders to take radical action on research and innovation “before it is too late” " ... UK Telegraph article. The authors "propose a 4-pronged strategy focusing on the creation of innovation friendly markets, on strengthening R&D resources, on increasing structural mobility as well as fostering a culture which celebrates innovation."

The reported, effective abandonment of Europe by pharmaceutical companies, for example, is occurring at the very moment that the synergy of computation, biotechnology, and medicine is just getting underway (cf. earlier posts on Ray Kurweil's book The Singularity is Near). Europe's world-class scientists and corporations tend to focus on important, profitable but well-established fields. Meanwhile, the international ties associated with "frontier" research create wealth and productivity gains that pass much of Europe by. _Anglosphere

Of course, under the Obama administration, the US may be well on the way to squandering its earlier advantages.

Worldwide R&D by Nation (PDF)
Funding drives R&D, but if the talent isn't there, the funding is largely wasted. That is why research universities in countries such as Saudi Arabia -- where the average IQ is only about 85 points -- must import must of their high powered scientists and engineers from the outside.

H/T Steve Sailer

China Is Best Seen As a Vast Organised Crime Syndicate

Update 16 April 2012: Among 100 Chinese government officials, there are 101 corrupted Chinese government officials

China is not a unified power. It is a conglomerate -- or a syndicate -- of multiple regions, sectors, and power blocs, operating under the umbrella of the central committee's oversight and sanction. Just like an organised crime syndicate, it is results that matter -- not necessarily the methods that were used to obtain the results.

Patrick ChovanecThe map above presents just one concept of how China could be divided. But in reality, China can be divided many different ways, in terms of the flow of power, wealth, and information. Rivalries between power blocs are fierce and the pressure to perform is unrelenting.

How is China like an organised crime syndicate? Let's look at just one example -- China's procurement of weapons systems from Russia:

For more than a decade, China has been a major importer of weapons. No more, despite a rapidly growing defense budget. Two years ago, China dropped to second place in weapons imports, and last year slipped to fourth place. The main reason is that China is producing more of the high-tech military gear it used to import. The main reason for that is massive theft of foreign military technology. While the best stuff was stolen from the West (usually via the Internet), the most useful designs were stolen from Russia. That's because Chinese manufacturing capabilities, for many exotic military technologies, are not yet up to Western standards. But the Chinese can make useful copies of Russian tech.

Throughout the 1990s, Russian arms exports to China were brisk, peaking at $2 billion a year. But six years ago, it all stopped. Well, for all practical purposes, with the flood shrinking to a trickle. The reason was Chinese theft of Russian military technology. For example, three years ago, Russia refused to sell China any Su-33 jet fighters for fear that the Chinese would steal the design and manufacture illegal copies. The Su-33 is a modified (for use on aircraft carriers) version of the Su-27. For several years China discussed the possibility of buying 50 Su-33s. But when the Chinese said they'd like to just buy two initially, for "evaluation purposes," Russia recoiled and said they would not sell the Chinese any of the 33 ton Su-33s. Russia uses two dozen of them on its carrier Kuznetzov, although these are being replaced by navalized MiG-29Ks.

The reason behind this refusal was Russia's admission that China was producing unlicensed copies of the Su-27 fighter. Russia had known about this theft for some time. It all began in 1995, when China paid $2.5 billion for the right to build 200 Su-27s. Russia would supply engines and electronics. But after 95 of the Chinese built aircraft were built, Russia cancelled the agreement. They claimed that China was using the knowledge acquired with the Su-27 program, to build their own copy of the Su-27, the J-11. Russia kept the piracy issue quiet, and warned the Chinese that simply copying Russian technology would produce an inferior aircraft. Apparently the Chinese do not agree, and are continuing their work on the J-11, using only, what they claim is, Chinese technology.

Another example of this tech theft is the Chinese HQ-9 anti-aircraft missile system, which is offered for export. This system is believed to contain technology from similar Russian (S-300) and U.S. (Patriot) systems. _StrategyPage

Multiply this small example by thousands of other ongoing instances across the spectrum of economic and political activity, and you will begin to understand how the China Syndicate operates. This is just how an organised crime syndicate works. The central criminal committee or boss doesn't care how the subsidiary crime groups make their money, as long as the tribute keeps coming, and the overall power of the central criminal committee remains intact.

Theft, espionage, piracy, extortion, fraud, murder, vice -- all of these tactics are acceptable to the central criminal committee, and are simply ways of doing business. The syndicate will not publicly admit to these activities, just as China's leadership will not publicly admit to the blatantly criminal actions of its sanctioned subsidiaries.

If a particular criminal chapter or "company" becomes too embarassing to the central criminal committee, pressure can be put on the bosses of that chapter. If pressure isn't enough, there are stronger ways of dealing with those who will not submit to the central criminal committee.

The Chinese culture puts its unique stamp on the various forms of criminal enterprise -- both official and unofficial -- which come together under the umbrella of the Chinese Communist Party Central Committee. But the general forms could be recognised anywhere -- from Sicily to Russia to Nigeria to Medellin.

What can you do once you have gained this insight? That is something that the governments of the advanced world have to ask themselves. Because the governments of the first world have enough trouble dealing with their own self-made disasters of debt, demographic decline, and energy starvation by carbon hysteria. Being scammed by the world's largest criminal enterprise, on top of everything else, is as useful as a rapid intracranial injection of hot lead.

Who Is Worse Off than Spain?

Vibrant Europe, Dying Europe: The curse of a pseudo-elite. No nation is immune.

JP Morgan via AlsoSprachAnalyst
The table above compares different European nations by a number of unfavourable characteristics, leading one to think that Spain may be the worst of the lot, overall. But if one looks at the US after only a few years under Obama, one begins to get a sense of a truly epic downfall.

Mr. Obama's agenda might best be seen as a grand plan to increase poverty. Here is a look at a small aspect of Mr. Obama's tax policy:

[President Obama's] ...statements about the benefits of such a [tax increase are] complete nonsense. How do you help the economy recover when you take away incentives for job creators? The reason capital gains rates are low is because Congress at some point realized that the economy would benefit from job and wealth creation by incentivizing entrepreneurs and investors, and the government would receive more revenue.

If I were president* and wanted to stimulate the economy, I would want to loosen the reins on job creators and let them run. I would be pleased if they got immensely rich and would gladly confiscate tax a greater profit at a lower rate because of the wealth and jobs they created (see AAPL, MSFT, etc.).

The President has a point about wealth disparity though. But what he fails to see is that government is largely responsible for this because of the financialization of the economy. That is, government policies have made it more rewarding to speculate than invest in productive enterprises. The solution isn’t to redistribute wealth, but to cure the underlying problem. Taxing the “rich” is the wrong way to do that. I can guarantee you that the taxes so raised will not raise the standard of living of the 99 percenters, rather it will be wasted on government programs that haven’t been effective.

The effect of his proposed tax will have the opposite effect he intends (“unintended consequences”). Instead of spurring the economy and creating jobs, thus creating more wealth, it will deter investment, cause capital and entrepreneurs to take less risks relative to the rewards, and increase the financialization of the economy. By failing to reward investors and entrepreneurs, production will shrink, wealth will be more concentrated, and the 99 percenters will become the 99,9 percenters. _DailyCapitalist

Mr. Obama has never been the brightest penny in the roll or the sharpest knife in the rack. But he may well be the most corrupt and most ideological president in US history at the same time. Combine his crony capitalism with his war against the private sector and his agenda of energy starvation, and the result is economic and intellectual stagnation.

As long as that country continues under Obama, if the US is not already worse off than Spain in many ways, it will be.

Under Obama, the debt debacle has just begun.

A Fear That There Is Enough Oil Left for Centuries More

This article was first published on Al Fin Energy

Rather than running out of oil and/or gas any time soon, I think the bigger danger is that we have more than enough oil and other fossil fuel energy resources to sustain us for quite a few decades if not centuries. Any efficiency and/or conservation of energy, combined with some replacement of fossil fuel energy with renewables than these finite resources, will extend hydrocarbon resources quite a few additional decades. _George Wuerthner, Ecologist

When M. King Hubbert offered his simplistic analysis of regional and global oil depletion back in the 1950s and 1960s, most people didn't know any better. Bestselling books such as "Silent Spring" and "The Population Bomb" were predicting the near-term collapse of the global ecosystem and global civilisation. According to those now-or-soon-to-be decomposing prophets of doom, we shouldn't even be here discussing the topic of our future. And yet, here we are.

The modern doom-equivalents of Rachel Carson and King Hubbert are warning of global collapse of civilisation and the ecosystem, due to peak oil and / or carbon hysteria / climate change. Some things never change, particularly the attraction of humans to doom and predictions of doom.

But why was Hubbert wrong, and why are his modern-day disciples just as wrong?

The problem for anyone trying to predict future resource availability is discerning the initial starting amount of a resource such as oil when one cannot readily see or gauge accurately the resource. This lack of transparency presents huge opportunities for error, in particular, erring on the side of under estimation of the total resource. And time has consistently shown that under estimation of total resource is the most common error, and as we shall see this is exactly the error that Hubbert made with regards to his estimates of our remaining oil and gas reserves. Hubbert can be forgiven because new technology can make previously unavailable resources accessible, even less expensive to exploit. In fact, he even anticipated this to a degree in his paper, another point that Hubbert’s admirers today tend to overlook.

...Hubbert grossly underestimated total oil supplies, and thus his predicted high point of the bell curve deviates significantly from reality. Indeed, there is good evidence we haven’t even reached the top of the bell curve, much less past it in 1970.

...Predicting future oil and gas supplies is fraught with dangers. Many factors influence oil extraction other than geological limits. A rapid shift to renewable energy, a decline in global economies, new technological innovation, energy conservation, a high oil price that dampens consumer demand, political instability and wars all significantly affects energy production, thus when and how “peak” is achieved. Many believe a more realistic model rather than a bell curve is a rapid run up in production to a spike or series of spikes followed by a long drawn out plateau and production decline with ultimately more oil production occurring after the apparent peak, but less rapidly than prior to the “peak” which of course wouldn’t really be a peak in the traditional sense of the word.

...Hubbert estimated that the “ultimate potential reserve of 150 billion barrels of crude oil for both the land and offshore areas of the United States.” Hubbert’s estimate was based on the crude oil “initially present which are producible by methods now in use.” Using the 150 billion barrel estimate he predicted US Peak Oil occurring in 1965. But to be cautious, he also used a slightly higher figure of 200 billion barrels which produced a peak in oil production around 1970—the figure that Hubbert advocates like to use to demonstrate that Hubbert was prophetic in his predictions. However, by 2006 the Department of Energy estimated that domestic oil resources still in the ground (in-place) total 1,124 billion barrels. Of this large in-place resource, 400 billon barrels is estimated to be technically recoverable with current technology.

...Obviously if Hubbert were correct, and we had reached Peak Oil in 1970 (point where we had consumed half of our oil) and we started out with only 200 billion, we could not have nearly 200-400 billion still left to extract—and total resources are likely even higher than this figure.

It’s also important to keep in mind that “technologically recoverable” resources are not the “total” amount of oil thought to exist in the US, so the total in-place reserves are much, much larger. It does not take a lot of imagination to predict that many of these oil resources will eventually be unlocked with new technological innovation thus added to the total “proven reserves.” _Counterpunch

Read the entire piece, for a better understanding of the author's claims that planet Earth has at least several decades of oil remaining. [Note: The author of the piece suffers from carbon hysteria, and is quite worried that there may indeed be enough oil left for centuries of use.]

Everything in the piece above has been discussed on Al Fin Energy at one time or another. But the Counterpunch article is an interesting refresher piece, counter-acting much of the daily drone of doom coming from peak oil cathedrals and seminaries.

What attracts otherwise normal people to these religions of doom and catastrophe? You may as well ask what attracts otherwise normal people to smoking, excess drinking, drug abuse, or overeating. Humans are just barely advanced apes. They are apable of language and rudimentary reasoning but are often not capable of overcoming innate weaknesses and counterproductive instincts.

Doomers will feed relentlessly on doom, at the cost of problems that might have been solved, and essentials that might have been produced. The rest of us have work to do.

Ideology's Greatest Threat: Former Believers In Search of Wisdom

We were never designed to listen to reason. When you ask people moral questions, time their responses and scan their brains, their answers and brain activation patterns indicate that they reach conclusions quickly and produce reasons later only to justify what they’ve decided.

...The problem isn’t that people don’t reason. They do reason. But their arguments aim to support their conclusions, not yours. Reason doesn’t work like a judge or teacher, impartially weighing evidence or guiding us to wisdom. _NYT_Saletan

The excerpts are taken from a William Saletan review of Jonathan Haidt's book, "The Righteous Mind." Just a few years ago, Jonathan Haidt was a partisan American leftist, before he embarked upon an intellectual journey in search of a larger wisdom. His writings and video presentations are causing quite a stir within a number of hidebound ideological communities. Haidt is stirring things up, because he is telling members of his former ideological congregation that they are only human -- much of what they think they know, just ain't so.

Humans typically arrive at a conclusion rapidly in an instinctive, intuitive, massively parallel manner. It is only in retrospect that they construct a logical argument to support their conclusion. The argument, more often than not, serves as armour shielding, to protect against contrary opinions and arguments. When systems of conclusions interact in a mutually reinforcing manner, they can grow over time, becoming ideologies. Ideologies tend to accumulate large conglomerations of defensive rhetorical shielding, which can open to accept those of like mind, and instantly close to exclude outside attacks.

... moral systems aren’t ignorant or backward. [Jonathan] Haidt argues that they’re common in history and across the globe because they fit human nature. He compares them to cuisines. We acquire morality the same way we acquire food preferences: we start with what we’re given. If it tastes good, we stick with it. If it doesn’t, we reject it. People accept God, authority and karma because these ideas suit their moral taste buds. Haidt points to research showing that people punish cheaters, accept many hierarchies and don’t support equal distribution of benefits when contributions are unequal.

...The hardest part, Haidt finds, is getting liberals to open their minds. Anecdotally, he reports that when he talks about authority, loyalty and sanctity, many people in the audience spurn these ideas as the seeds of racism, sexism and homophobia. And in a survey of 2,000 Americans, Haidt found that self-described liberals, especially those who called themselves “very liberal,” were worse at predicting the moral judgments of moderates and conservatives than moderates and conservatives were at predicting the moral judgments of liberals. Liberals don’t understand conservative values. And they can’t recognize this failing, because they’re so convinced of their rationality, open-mindedness and enlightenment. _NYT Review of Jonathan Haidt's "The Righteous Mind"_ by William Saletan

The problem is shared by humans of all ideologies, of course, not just leftists. What makes the intellectual blindness of the left such a problem today, is the almost total control by the left of academia, main-skankstream journalism, popular media, and governmental regulatory bureaucracies. The resultant veering of public policy and top-down social values out-of-control -- without apparent checks and balances or any sign of deeper wisdom -- threatens to drown most western nations in a quagmire of debt, demographic decline, and mental/moral atrophy.

Being Human: Mental + Representations & Decision-Making from Being Human on FORA.tv
This FORA.TV panel discussion looks at how humans represent reality and make decisions.

The human mind has come to be a remarkable organic machine. It is a shame when so much of the mind's potential is squandered in service of ideology.

Peak Oil: If Not for Carbon Hysteria, We Wouldn't Be Having This Conversation

This article was posted originally on Al Fin Energy blog:

In 1920, the U.S. Geological Survey estimated that the world contained only 60 billion barrels of recoverable oil. But to date we have produced more than 1,000 billion barrels and currently have more than 1,500 billion barrels in reserve. World petroleum reserves are at an all-time high. _newsok

For over 150 years, "knowledgeable insiders" have been predicting the end of oil. Over that time period, oil has endured multiple cycles of boom and bust, with high and very high oil prices alternating with low and very low oil prices. High oil prices -- if they are sustained over several years without a "price bust" -- lead to increased exploration and improved technologies for production.

...technological advances have opened up resources beyond the limits of our ancestors' imaginations. We can drill offshore in water up to 8,000 feet deep. We have enhanced recovery techniques, horizontal drilling and four-dimensional seismic imaging. Oklahoma oilman Harold Hamm is turning North Dakota into Saudi Arabia by using hydraulic fracturing technology. U.S. oil production has reversed its 40-year decline. By the year 2020, it is anticipated that the U.S. will be the world's top oil producer.

...Nine years ago, I predicted that the age of petroleum has only just begun. I was right. The Peak Oil theorists, the malthusians and the environmentalists were all wrong. They've been proven wrong, over and over again, for decades. A tabulation of every failed prediction of resource exhaustion would fill a library.

Sustainability is a chimera. No energy source has been, or ever will be, sustainable. In the 11th century, Europeans anticipated the industrial revolution by transforming their society from dependence on human and animal power to water power. In the 18th century, water power was superseded by steam engines fired by burning wood. Coal replaced wood, and oil and gas have now largely supplanted coal. In the far distant future we'll probably use some type of nuclear power. But for at least the next hundred years, oil will remain our primary energy source because it's abundant, inexpensive and reliable.

...What's stopping us isn't geology. What's stopping us is ignorance and bad public policy. _New Age of Oil

But why are we even having this conversation about "peak oil" in the first place? The graphics pictured below should show anyone with intelligence that energy collapse will not be in the cards anytime soon.

Look at the tiny amount of liquid hydrocarbon that has been consumed by humans so far. Then look at the nearly infinite amount of liquid hydrocarbons and liquid substitute fuels which remain in the wings, waiting for sufficient need and ingenuity on the part of humans.

Discussion about EROEI -- energy returned on energy invested -- is just so much trash talk. When you consider the potential of high quality, abundant industrial process heat from advanced nuclear reactors, EROEI fears begin to sound like a joke. Whether it takes 10 or 20 years to develop and build gen IV high temperature gas cooled modular reactors, the die is cast, and peak oil doom is itself doomed, along with EROEI fears.

So what is this conversation truly about? Beneath all the smokescreens, it is about lefty-Luddite carbon hysteria, and the fear of of an advanced technological future for humans. If not for a trumped-up and irrational fear of carbon, a true hydrocarbon abundance suddenly opens up before us -- along with an abundance of electricity from advanced, safe, clean, nuclear reactors.

But if we listen to the lefty-Luddite green dieoff.orgiast fears coming from the highest levels of human governments and inter-governments, we face a new dark age of energy starvation. An age where unreliable intermittent-renewables -- ever prone to breakdown and failure -- replace reliable forms of power and energy.

The green world view is based upon several delusional beliefs, including carbon hysteria, energy scarcity, overpopulation, an environment doomed by global pollution. But these green lefty-Luddite fears are several decades old. Many of these same greens predicted that the great human dieoff was certain to occur in the 1970s, 1980s, and 1990s. They predicted doom from global cooling -- from CO2 and pollution, no less.

But when a temporary cooling trend was replaced by a temporary warming trend, these greens of doom quickly changed tack and jumped aboard a global warming train -- caused by the same things, supposedly, that were to have brought about global cooling! They are nothing if not versatile.

But the underlying cause of doom -- in the mind of a green -- is always human industry, human science, human technology, human commerce. That is what they fear and what they attack -- the fruits of human ingenuity itself.

The end result of human ingenuity is a cleaner and more sustainable -- but more abundant -- human future. That is what greens fear. They fear that we will move beyond the more primitive stages of human technology into cleaner, sustainable -- but very abundant -- forms of technology. This possibility is a distinct threat to the leftist green vision of the future, and must be opposed by greens in every way possible, using every green tool and green trick in the book.

That is what carbon hysteria is, of course. It is a tool to be used until it is of no more use, then it will be discarded for whatever else might serve. Just like "energy depletion and scarcity," carbon hysteria is a useful tool of ideology, without which the "peak oil myth" could never survive long.

The green fear is not that there is not enough oil, not enough hydrocarbon fuel. The fear is that there will always be more than enough. As a tool to stoke that fear, carbon hysteria cannot be improved upon. Peak oil: without carbon hysteria, we wouldn't be having that conversation.

More: Recycling Doomsday: How Failed Predictions of Doom Are Recycled Every 30 years or so. Stranger than fiction. And if not for the fact that these purveyors of contrived doom are influential at the highest levels of national and international government, we could all have a good laugh on the poor sods.

New Approaches in Anti-Viral Warfare: Hope for HIV, HepC, HSV ...?

Here are three promising new approaches to meeting the threat of the viral apocalypse:

1. Teach the body to throw a "monkey-wrench" into the virus assembly, preventing the virus from forming
2. Devise a "super-interferon" broad spectrum super-antiviral
3. Teach cells that are infected with dangerous viruses to commit suicide

Wired.co.uk

Buoyed by advances in molecular biology, a handful of researchers in labs around the US and Canada are homing in on strategies that could eliminate not just individual viruses, but any virus, wiping out viral infections with the same efficiency that penicillin and ciproflaxacin bring to the fight against bacteria. If these scientists succeed, future generations may struggle to imagine a time when we were at the mercy of viruses, just as we struggle to imagine a time before antibiotics.

Three teams in particular are zeroing in on new antiviral strategies, with each taking a different approach to the problem. But at root they are all targeting our own physiology, the aspects of our cell biology that allow viruses to take hold and reproduce. If even one of these approaches pans out, we might be able to eradicate any type of virus we want.

...The first thing researchers at Prosetta had to do was search for promising candidates -- molecules of just the right shape to lodge into the capsid-making machinery. They screened 80,000 compounds by testing each in a cell-free system. Most couldn't stop capsids from forming, but a few dozen did. Instead of focusing on one, Lingappa decided to pursue almost all of them on the premise that a victory against any one virus would help Prosetta extend its strategy to all of them.

It was a gutsy strategy, and so far it's paying off. Studies -- in both cell cultures and on animals -- are showing that Prosetta's approach can stop rabies, Ebola, influenza and a number of other viruses. If, as Lingappa suspects, all viruses need help from their host cells to assemble, he may have found a strategy that can work against every virus that could ever make us sick.

[The] second approach is being spearheaded by Eleanor Fish of the University of Toronto. She and other researchers worldwide are developing drugs that might replace or supplement interferons, our own catch-all viral response proteins. Essentially the idea is to accelerate the body's own virus-killing powers. Our cells can sense a viral invasion because of a quirk in the way most viruses replicate: using the host cell's machinery, they copy their own genes by making a peculiar molecule called double-stranded RNA. So our cells are equipped with proteins whose sole job is to detect double-stranded RNA. When they do, they relay a signal throughout the cell that an intruder has invaded.

The cell then produces interferons, which in turn trigger the production of more than 300 other kinds of proteins, each with its own role to play in killing viruses. Some slice up the virus's genes and wreck its proteins. Others tell the cell to become rigid, making it harder for new viruses to escape. The infected cell also sends interferons to surrounding cells, creating a firebreak that stops the spread of the infection. "The very first response to a virus is an interferon response," Fish says.

...By tacking on polyethylene glycol -- a cluster of hydrogen, carbon and oxygen atoms -- they've created synthetic interferons that last days instead of hours and will wipe out hepatitis C viruses completely in up to 81 per cent of treated patients, depending on the strain. During Toronto's Sars outbreak, Fish tested synthetic interferons on a small pool of patients and found that their lungs healed significantly faster than those of control patients, allowing them to get off supplemental oxygen sooner. Like Lingappa, Fish has huge ambitions for these synthetics. If one of them succeeds, it could become a single drug to fight not just one virus or a few, but nearly every virus.

...The third and arguably the most radical approach to broad-spectrum antivirals was conceived years ago by biological engineer Todd Rider... "I wanted a treatment that was broad spectrum, that was effective against a wide range of viruses, and that would be difficult for viruses to evolve resistance to," he says.

That something was an artificial protein. To make it, he would need to marry parts of two natural proteins. One string would detect double-stranded RNA, the telltale sign of most invading viruses. The other would lead the infected cell to kill itself. Rider wanted to make a poison pill for cells: a protein that, when it grabbed on to the double-stranded RNA of a virus, would trigger instant cellular suicide. That may sound like a dangerous kind of therapy, but our bodies already rely on it naturally to fight both infections and cancer.

Rider dubbed his theoretical molecule Draco, for double-stranded RNA activated caspase oligomeriser. _Wired

These approaches represent a departure, of sorts, from conventional consensus antiviral approaches. Sceptics of traditional approaches, scientific mavericks blaze new trails of discovery which their orthodox "safety in the crowd" colleagues would never risk.

The fact that it has taken so long for humans to begin to devise such strategies, in the face of desperate need, suggests that human educators and human societies are not raising children who can make use of their innate intellects and creativity. The brains that we have are being wasted, and the brains that we could have are not imagined or conceived. The intellectual powers we do have are too often squandered on consensual orthodoxies, intellectual treadmills to nowhere.

Smaller, Cheaper, Faster, Better

Some parts of the US military have adopted the slogan, "smaller cheaper faster better." The USAF spacecraft pictured below is a good example. It was cheaper and smaller to build and launch than the US space shuttle. It can be kept in space -- without astronauts -- for months or years at a time, and can be readied for re-launch on short notice, just weeks after landing.

Wired Danger Room

The “smaller-is-better” space revolution wasn’t inevitable. It resulted from a complex interplay of politics and economics, plus a chain of engineering crises that claimed some careers and even a few lives. What follows is a brief recent history of America’s space force from the end of the Cold War to today, with a glimpse into the future as old spacecraft waste away and smaller, quicker, cheaper and more robotic systems take their place.

...Pete Worden, a mischievous Michigander now in his mid-60s, achieved the rank of brigadier general in Air Force Space Command, where he helped oversee satellite development and operations. In the early-’90s he co-led a two-year probe mission costing just $80 million that seemed to confirm the presence of water on the moon.

In the ’90s and early 2000s, Worden argued that smaller, cheaper spacecraft, developed quickly and launched frequently, were the key to a better, more survivable space arsenal — one that could be quickly tailored to counter pop-up threats and had enough self-contained pieces to absorb attacks from a power such as China.

Instead of maintaining today’s arsenal of some 200 pricey, military-grade satellites, U.S. space agencies should operate potentially thousands of smaller, cheaper spacecraft in a vast, constantly shifting constellation, reformers such as Worden claim. Each craft in this new space force should be just good enough to achieve its mission — no better — and sourced from the lowest bidder. No single satellite should be so valuable that the U.S. can’t afford to lose it.

Inspired by Worden’s moon probe, in 1992 NASA initiated the “Faster, Better, Cheaper” program, which aimed to build and deploy spacecraft in just a year or two instead of decades, and at a cost of just a couple hundred million bucks apiece instead of billions. The space agency was still investing heavily in pricey, old-style equipment. But there was enough skepticism within NASA to fuel support for Faster, Better, Cheaper.

Between ’92 and ’99, NASA launched 16 Faster, Better, Cheaper missions, including five Mars probes and a couple space telescopes. Ten of the speedy, inexpensive missions succeeded. Six failed owing to engineering errors or communications mix-ups.

...With its roots in Worden’s moon probe and NASA’s Faster, Better, Cheaper effort, New Space has made a deep impression on a U.S. space force reeling from its recent failures and China’s rapid rise. In the past few years, the Pentagon in particular has moved to institutionalize Worden’s vision.

In 2007, the Air Force established the Operationally Responsive Space office in New Mexico. Spending just $100 million a year for five years, the new organization built and launched four quick-and-dirty satellites. The office’s biggest successes was ORS-1, a surveillance satellite roughly the size of a compact car, compared to the semi-truck-size orbital spies that were standard before. To keep down costs, the Air Force fitted the new sat with the same camera as the U-2 spy plane. Launched in 2011, ORS-1 began peering down on Afghanistan in January.

...The flying branch has also embraced air-breathing “pseudolites” — that is, high-altitude drones, planes or even balloons that can perform many of the same functions of satellites but more cheaply. As they can maneuver more quickly, they’re also less vulnerable to Chinese rockets. In recent years EQ-4 Global Hawk drones and even KC-135 tankers fitted with radio relays have begun filling in for multi-billion-dollar communications satellites. Bottom line: the future of the U.S. orbital arsenal lies in “militarily responsive space-launch supplemented with air-breathers,” Larry Wortzel, an adviser to the U.S. government on space issues, tells Danger Room.

... _Danger Room

The USAF space branch is not the only part of the US military that is adapting the smaller, cheaper, faster, better motto. But it takes time for the centuries-old vision of huge and vastly expensive systems to die out in an organisation as tradition bound as a national military.

Under US Defense Secretary Rumsfeld, all branches of the military services were tasked with the mission of streamlining units and taskforces. Smaller but more accurate bombs and artillery shells, more automation and unmanned systems, all of these were part of the Rumsfeld vision. And naturally, the entrenched vision battled against the Rumsfeld vision. But the laws of economics in a welfare state -- where a defense budget must battle for its existence against an exponentially expanding entitlement budget and a rapidly growing interest on the national debt -- will eventually force the issue. Militaries of welfare states must become more agile and adaptable or they will crumble under their own unwieldy weight.

And eventually, of course, the US military will be forced to drastically reduce its overseas commitments. It is not a question of if, but of when. Smaller, cheaper, faster, better. There will be a lot of surprises unpacked from those four simple words.

Why Do Blacks Commit So Much Violence and Mayhem?

... violent crime is lowest in East Asian countries, intermediate in European countries, and highest in African and in Black Caribbean countries. The median number of violent crimes per 100,000 population were: 7 East Asian countries--34; 45 European countries--42; and 22 African and Black Caribbean countries--149, respectively. The median Gross Domestic Product per Person was highest in East Asian countries ($12,600), intermediate in European countries ($7,400), and lowest in African and Black Caribbean countries ($1,900). Across the three population groups there was an "ecological correlation" of -.96 between crime and wealth (wealthier countries had less crime). Finer-grained analyses, however, found that while wealth was negatively related to crime across European or East Asian countries, it was positively related to crime for the African and Black Caribbean countries (i.e., the wealthier an African or Black Caribbean country, the greater its rate of violent crime). _Cross National Variation in Violent Crime Rates

Around the world, wherever people of African descent are found in appreciable numbers, crime rates tend to be high. Various arguments have been used to explain the high rates of black crime within and around African populations, but the explanation is likely to involve many different factors.

Chicago Scene

Blacks are seven times more likely than people of other races to commit murder, and eight times more likely to commit robbery.

When blacks commit crimes of violence, they are nearly three times more likely than non-blacks to use a gun, and more than twice as likely to use a knife.

Hispanics commit violent crimes at roughly three times the white rate, and Asians commit violent crimes at about one quarter the white rate.

The single best indicator of violent crime levels in an area is the percentage of the population that is black and Hispanic. _Color of Crime

18 and 19 Year Old Accused of Carjacking and Beating 50 Year Old Man Into a Coma With a Hammer
The two adolescent males pictured above were arrested for beating the 50 year old male owner of a carjacked SUV with a hammer, leaving him for dead. He is still on life support in hospital. This crime occurred in the same part of Florida as the recent Trayvon Martin shooting, a region that has suffered an epidemic of crime.

US Incarceration Rates by RaceThe high rates of black violent crime are undeniable, although many persons will, for political purposes, deny the obvious. For those who live in the real world, it is important to find the underlying reasons for this long-lived and world-wide epidemic of violent crime, and discover humane ways of dealing with it.

Here is one aspect of the US black community which is often overlooked: The epidemic of fatherlessness and lack of non-criminal role models --

• 70% of all black children are born out of wedlock.
• 65% of never-married black women have children, double that for white women.
• 22% of never-married black women with incomes over $75,000 have children, 10 times that of white women.
• 62% of black families with children are headed by a single parent.
• 85% of black children do not live in a home with their fathers.
• Only 15-20% of black children born today will grow up with 2 parents until age 16.
• Over 80% of long-term child poverty occurs in broken or never-married homes.
• 70% of [black] boys in the criminal justice system come from single-parent homes. _LaShawn Barber_quoting from _A Portrait of the Black Family 2007 (PDF)

Other reasons often given for the ongoing pandemic of violent crime overflowing from black communities around the world, include: poor impulse control, low frontal lobe executive function, low IQ, an ongoing environment of hatred generated within black communities and media outlets which create and amplify violent hatred against other races, politically correct excuses made for black violence in the public sphere, and so on . . .

As noted at the top of this posting, poverty is often given as an excuse for economic crimes such as theft, but it can hardly be used to justify murder, rape, and other vicious assault.

Evolutionary psychology may eventually come up with an answer, if the politically correct apologists and enablers can be held back long enough for actual scientists to work on the problem. But how likely is that, particularly when the US President himself dabbles in racial rabble rousing from time to time?

This is not an academic problem, it is not a theoretical problem. While crime exists in all populations of the world, it is noticeably higher than average in and around black communities.

Crime is too complicated to be reduced to mere race. But race cannot be ignored when considering the problem of violent crime, and what can be done to reduce the suffering. First, one must understand the problem. Then one must devise the most humane solutions possible.

It is not clear that the current arrest and incarceration practises within the US are the most humane solutions possible.

More: Steve Sailer compares media coverage of Trayvon Martin and Omar Thornton. If the news media fails to do its job, it only compounds the problem and takes societies further from genuinely humane solutions.

President Obama Is Playing Politics With Pipelines

This article is adapted from an earlier posting at Al Fin Energy

NP
Canadians are wondering why Mr. Obama has to make simple trade issues so complicated. By obstructing much of the potential flow of Canadian oil southward, Mr. Obama opens entirely new cans of worms which did not need to be opened.

The [Keystone XL] pipeline decision was delayed until after the presidential election so Obama wouldn’t have to offend his environmental supporters while he seeks re-election. None of the excuses offered for the delay holds water: The chosen route for the project through a valuable aquifer was no great threat, the project had passed crucial safety tests, and the area is already criss-crossed by a large network of other pipelines. It was all about politics.

But the result of the decisions is the quandary now facing the president: The U.S. needs oil one way or another. Whatever the long-range attractions of reducing dependency on fossil fuels, the world isn’t going to switch to biofuels and solar power overnight, and a secure supply of oil will remain crucial for decades to come.

The source of that fuel is critical to the U.S. The problems with Iran are a perfect demonstration of that: in the absence of a friendly, secure, reliable supplier, the U.S. is forced to look to places like Saudi Arabia and Venezuela. After Canada and Mexico, the top suppliers to the U.S. are Saudi Arabia, Venezuela, Nigeria, Angola and Iraq. Not one real democracy in the lot, all of them with serious political and stability issues. and none of them right next door.

Canada, on the other hand, is just across the border, is a close friend and ally of the U.S., and is both ready and eager to ensure a reliable increase in supply. But Washington’s willingness to play games with the Keystone project has only served to increase Ottawa’s awareness of the need to find other customers.

...Mr. Obama could have avoided all this by accepting the self-evident benefit to the U.S. of getting Keystone built as quickly as possible. Instead he’s got to juggle Saudi capacity against Iranian vengefulness, and the long-term implications of a risky sanctions plan that could blow up in the face of its supporters.

Relying on his friends in Canada would have been so much easier. _NP_

Enbridge has recently announced the expansion of its pipeline from Canada to the Gulf of Mexico, to provide an alternative pathway for Canadian oilsands in the wake of the recent Obama rejection of the Keystone XL pipeline northern leg.

Enbridge Oil Sands Alternative via Chicago
When Obama took executive action to prevent the upper leg of the Keystone XL pipeline, environmentalists celebrated as if they had won a victory. But there may be more involved in the story than what was printed in the newspapers or broadcast on the airways and cable channels. Whenever an economic decision is made by a government, sceptical people always ask: "Who benefits?"

Brian Westenhaus takes a look at the recent Enbridge announcement that it is expanding its pipeline network to provide an alternative pathway to the Gulf of Mexico for Canadian oilsands.

Oil flowing through Illinois is subject to local fees and taxes, which enrich the many corrupt FOOs (friends of Obama) who have taken up positions of power there. But one must also wonder what goes on behind the scenes before such a decision is even made.

Keystone XL Bypasses ChicagoAs you can see if you follow the dotted green line representing the Keystone XL pipeline, the pipeline which Obama is stonewalling does not come anywhere close to Illinois or Chicago. In that sense, the pipeline is no good to Obama or all the crazy FOOs in that corrupt state. Unlike the alternative pipeline plan recently announced by Enbridge. Politics can be a byzantine affair, twisted and labyrinthine in its ways of distributing power and money to those who please the king.

Europe's Trifecta of Doom: Debt, Demographic Decline, Energy Suicide

The ongoing economic crisis in Europe may have begun in Greece. But it will not end there. Eurozone unemployment is approaching a 15 year high, and the people of Spain appear eager to emulate the example of Greece.

None of the economic bandaids being offered are up to the job which seems to demand radical surgery. Europeans increasingly choose to riot, demanding that an economic faerie god mother grant them their entitlements, rather than to face the issues soberly. If governments give in to the rioters, the decline will only occur more quickly.

The underlying issues of energy suicide and demographic decline are not being addressed. If those problems are not solved, there is ultimately nothing that can be done to save the Eurozone or most individual Euro economies.

The misguided energy policies of the German government are representative of much that is wrong with Europe. Yes, European executives and functionaries will try to put the best face on things, but if manufacturers cannot operate due to designed high energy costs, and unemployment continues to skyrocket, a smiling face only reveals a refusal to do what must be done to prevent disaster.

And with low birthrates across Europe -- particularly southern and eastern Europe -- each generation of Europeans is smaller than the previous one, with less human capital and lower skill levels. Fighting back against the decline becomes more difficult as the numbers and skills levels decline.

Europe is not alone in its inability to save itself from slow motion collapse. Japan's debt and demographic problems are just as bad as those of southern and eastern Europe. The US under Obama has plunged into debt and energy suicide at a record rate. China is suffering from an increasingly dysfunctional economic infrastructure that threatens to squander all of its hard-won gains of the previous two decades.

Europe's doom is all the more poignant for having been entirely self-designed and well-intentioned. The lefty-Luddite green dieoff.orgy memosphere pervading European governments, universities, and populations, was meant to help save the Earth from too many people and too much consumption. If the end result of such memes was a demographic decline of ethnic Europeans and the intentional starvation of Europe's industries and economies of reliable and affordable energy, who could have known?

The social democracies of Europe and the public unions were meant to guarantee lifelong prosperity and health to Europe's people. If the end result of such good intentions was a hardening sense of dependency and entitlement, and a softening of the people's ability to adjust to adversity or threat, who could have known?

Europe is not a monolithic entity, of course. Parts of Europe may fall to the trifecta, while other parts may survive.

And certainly Europe is not the entirety of the civilised world. It is possible that other parts of the civilised world will learn the lessons of Europe, and pay closer attention to the need for abundant and affordable energy, fiscal discipline, economic opportunity, rule of law, and demographic replacement at equivalent levels of human capital.

Europe is changing quickly, particularly the cities of Europe. Eventually, the only way to know what Europe was once like in times of peace and prosperity, will be to take a virtual reality tour.

(Near) Real Time US Continental Wind Map

The effect of watching the wind swirling over the entire continental US in near-real time can be hypnotic. I can't wait until a global version is available.

Surface wind data comes from the National Digital Forecast Database. These are near-term forecasts, revised once per hour. So what you're seeing is a living portrait. (See the NDFD site for precise details; our timestamp shows time of download.) And for those of you chasing top wind speed, note that maximum speed may occur over lakes or just offshore. _Wind Map

Wind Map
The above image is a static screen capture from the website. The actual on-site image is dynamic, and zoomable for up-close looks at particular regions.

This is reminiscent of the "mirror world" concept of digitally augmented reality portrayals which can be mapped on top of the real world in real time. The amount of information expected to become available to ordinary people using such means is expected to be astoundingly large.

More: Second Earth: World Wide Sim (PDF)

If we learn to use this new wealth of knowledge to our benefit, we can be immensely richer for it.