…I guess you could call it a “blog,” but with some interesting twists: Jotzel is intended to provide a forum for business news and business-related discussions. Any registered member can submit a post, but it will be activated only when a sufficient number of other registered members vote positively on it. It’s kind of like a blog carnival, but with continuous rather than periodic posting, and with distributed rather than centralized administration. I think it has a lot of potential if it can achieve a critical mass of participants.
David Foster
Serious Spy Charges
Four people have been arrested in Los Angeles and charged with smuggling vital defense secrets to China. The information believed to have been transferred includes details on the Aegis battle-management system, a vital component of U.S. cruisers and destroyers, and on the new Virginia-class attack submarines. Officials said that based on a preliminary assessment, China now will be able to track U.S. submarines. It is also believed that information was provided which would facilitate the development of electromagnetic pulse weapons, which could disrupt electronics over a wide area, as well as information on unmanned aerial vehicles.
U.S. intelligence officials said the case remains under investigation but that it could prove to be among the most damaging spy cases since the 1985 case of John A. Walker Jr., who passed Navy communication codes to Moscow for 22 years.
Here is the (rather brief) New York Times article on this matter. Read it for yourself, and see if you think it properly represents the seriousness of what has apparently happened here.
Do you think that this will receive anywhere near the media attention which has been devoted to the Valerie Plame affair?
(also posted at Photon Courier)
Dark Thoughts from Peggy Noonan
If you haven’t already, please go read this piece by Peggy Noonan.
Then come back and let’s discuss it.
Are things really that bad?
Information Please
Concerning hybrid cars–I’ve frequently seen the assertion that the energy costs of manufacturing the battery are so great that they use up as much energy as that saved by operating the vehicle. I’ve been unable, however, to find any actual data on the topic. Can anyone help?
What I’m looking for is the energy consumption of making a hybrid battery, including the total value chain (including mining of the raw materials) and also how much of this is recoverable if the battery is recycled.
This seems like essential information for anyone who wants to develop an informed opinion about the future of hybrid power.
More Obfuscation on Social Security
The Wall Street Journal (5/17) carries a letter from the AARP criticizing private accounts. Extract: “To compensate for the less of Social Security revenue into private accounts, the federal government would have to borrow significant sums in order to pay promised benefits–$754 billion in the first 10 years, and $3.5 trillion in the following decade.”
AARP suggests as an alternative (1)raising the wage cap on SS taxes, and (2) “diversifying the Social Security Trust Fund investments to get a higher return.”
Huh?
To the extent that SS Trust Fund inflows are invested in corporate securities to get that “higher return”, they would not be available to fund other government shortfalls–thus, the government would have to issue additional debt to cover these shortfalls. Just as in the case of private accounts, the money going into the private accounts would have to be made up by other debt. Whether the money is invested by the government or by private account holders makes no difference on the amount of new Treasury debt that would have to be issued to offset it; the only thing that changes is the legal status of the account ownership.
Also: one variant of private accounts would require that the money be invested in Treasury securities. In this case, the money would still be available to fund other government shortfalls…just as if it were going into the Trust Fund.
The tradeoff with stock/bond investments is probably-higher returns in exchange for more issuance of government debt to cover the money no longer flowing in from SS payments. This applies whether the investments are made in the form of individual accounts or whether they are made thru a government pool.
We need more clarification of what the SS alternatives really mean, which requires good-faith attempts to elucidate complex financial matters. There’s been far too little of this and far too much political posturing, on both sides.