links for 2008-09-03

• Does the GDP deflator lie? - macroblog
• Gramm Reiterates “Whiners” Argument - Matthew Yglesias
• Feldstein and Taylor Can't Obscure the Truth - Economists for Obama
• Good Money - Marginal Revolution
  
• Economy? What Economy? - washingtonpost.com
• The Neurological Roots of Genius - Scientific American
• Braking the Virus - Olivia Judson
• How the Fed Can Fix the World - Op-Ed - NYTimes.com
•   Vetting - Robert Reich
• "Energy resources and our future" - 1957 - Energy Bulletin
• Anti-Shirking Penalties in US Climate Change Bills Could Backfire - Jeff Frankel
• 3 Directors of the Fed Advocated a Rate Rise - NYTimes.com
• Unqualified for Duty - Watchdog Blog
• Glaeserfication - The Bellows
• Corporations and the Conventions - Robert Reich

Comments

[robertdfeinman]

Just in time for the new academic year, the local radio station announced that NYU and Columbia now cost $50K+ per year (including room and board) for undergraduates.

Perhaps some economist would like to explain this market to the befuddled like me. If the cost was too high already then why does it go up each year? Perhaps there is some mystique about Harvard and Yale that allows them to demand a premium price, but NYU?

[anne]

Robert Feinman:

"Just in time for the new academic year, the local radio station announced that NYU and Columbia now cost $50K+ per year (including room and board) for undergraduates."

[Cost]

Customers don't pay the full tab (pay with other people's money so price is no object), lack of effective competition so there is little incentive for innovation, etc...

[robertdfeinman]

GOP newspeak explained by a British columnist. It would be funny if it wasn't so true (and evil):

How to speak Republican

A sample:
Choice
Although it's still part of the abortion debate (see pro-life), choice is also a Republican code word for privatisation, a term that got a bad name with President Bush's botched attempt to privatise social security. It's also used for promoting private sector involvement in traditional government functions. Now Republicans talk about "retirement choice", "Medicare choice" or longstanding favourite "school choice"

[anne]

The early indication of the fighting in Ossetia from Ossetia proper indicate that not only did Georgia shell Ossetia but the territory was bombed as well. Evidently Georgian planes did attack Ossetia, much to my astonishment in thinking how Georgian general officers would have participated in such an attack not matter the President. Russia had to have responded to such a provocation, and Georgian forces melted away before the Russians.

The Georgian attack looks even more improbable after all this time.

[anne]

http://www.nytimes.com/2008/09/04/world/europe/04cheney.html?hp=&pagewanted=print

August 4, 2008

U.S. to Unveil $1 Billion Aid Package to Repair Georgia
By STEVEN LEE MYERS

The announcement was coming as Vice President Dick Cheney arrived in the region to signal support for Georgia and other nations neighboring Russia.

[anne]

http://www.nytimes.com/2008/09/04/world/asia/04attack.html?ref=world&pagewanted=print

August 4, 2008

NATO Accused of Civilian Deaths Inside Pakistan
By PIR ZUBAIR SHAH and JANE PERLEZ

Two helicopters carrying coalition forces opened fire in a village near the Afghan border, killing seven people, according to a Pakistani military spokesman.

[Why I think Barack Obama's position on Afghanistan-Pakistan a critical error in strategy and ethics.]

[anne]

http://angryarab.blogspot.com/2008/09/pakistani-military-which-has-been.html

September 2, 2008

"The Pakistani military, which has been criticized by Washington for not pushing hard enough against Taliban militants, has used jet fighters and helicopter gunships in the past three weeks to strike at insurgents who pour over the border to attack American forces in Afghanistan." *

* http://www.nytimes.com/2008/09/01/world/asia/01pstan.html

-- As'ad AbuKhalil

[anne]

Correcting the dates above from August 4, 2008 to September 4, 2008. I am sorry, but evidently lost in space-time. Sort of Kurt Vonnegut-wise.

[anne]

http://www.nytimes.com/books/97/09/28/lifetimes/vonnegut-slaughterhouse.html

March 31, 1969

At Last, Kurt Vonnegut's Famous Dresden Book
By CHRISTOPHER LEHMANN-HAUPT

SLAUGHTERHOUSE-FIVE, OR THE CHILDREN'S CRUSADE
By Kurt Vonnegut Jr.

Kurt Vonnegut Jr., an indescribable writer whose seven previous books are like nothing else on earth, was accorded the dubious pleasure of witnessing a 20th-century apocalypse. During World War II, at the age of 23, he was captured by the Germans and imprisoned beneath the city of Dresden, "the Florence of the Elbe." He was there on Feb. 13, 1945, when the Allies firebombed Dresden in a massive air attack that killed 130,000 people and destroyed a landmark of no military significance.

Next to being born, getting married and having children, it is probably the most important thing that ever happened to him. And, as he writes in the introduction to "Slaughterhouse-Five," he's been trying to write a book about Dresden ever since. Now, at last, he's finished the "famous Dresden book."

In the same introduction, which should be read aloud to children, cadets and basic trainees, Mr. Vonnegut pronounces his book a failure "because there is nothing intelligent to say about a massacre." He's wrong and he knows it.

Kurt Vonnegut knows all the tricks of the writing game. So he has not even tried to describe the bombing. Instead he has written around it in a highly imaginative, often funny, nearly psychedelic story. The story is sandwiched between an autobiographical introduction and epilogue.

Fact and Fiction Combined

The odd combination of fact and fiction forces a question upon the reader: how did the youth who lived through the Dresden bombing grow up to be the man who wrote this book? One reads "Slaughterhouse-Five" with that question crouched on the brink of one's awareness. I'm not sure if there's an answer, but the question certainly heightens the book's effects....

Now there are two things I haven't yet told you about Billy Pilgrim, and I'm hesitant to do so, because when I tell you what they are you'll want to put Kurt Vonnegut back in the science-fiction category he's been trying to climb out of, and you'll be wrong.

First, Billy is "unstuck in time" and "has no control over where he is going next." "He is in a constant state of stage fright...because he never knows what part of his life he is going to have to act in next."

Story Told Fluidly

This problem of Billy's enables Mr. Vonnegut to tell his story fluidly, jumping forward and backward in time, free from the strictures of chronology. And this problem of Billy's is related to the second thing, which is that Billy says that on his daughter's wedding night he was kidnapped by a flying saucer from the planet Tralfamadore, flown there through a time warp, and exhibited with a movie star named Montana Wildhack....

[anne]

http://www.nytimes.com/2007/04/12/books/vonnegut-sampler.html

March 31, 1969

A guard would go to the head of the stairs every so often to see what it was like outside, then he would come down and whisper to the other guards. There was a fire-storm out there. Dresden was one big flame. The one flame ate everything organic, everything that would burn.

It wasn't safe to come out of the shelter until noon the next day. When the Americans and their guards did come out, the sky was black with smoke. The sun was an angry little pinhead. Dresden was like the moon now, nothing but minerals. The stones were hot. Everybody else in the neighborhood was dead.

So it goes.

— "Slaughterhouse-Five."

[rufus]

"http://www.nytimes.com/2008/09/04/world/asia/04attack.html?ref=world&pagewanted=print

August 4, 2008

NATO Accused of Civilian Deaths Inside Pakistan
By PIR ZUBAIR SHAH and JANE PERLEZ

[Why I think Barack Obama's position on Afghanistan-Pakistan a critical error in strategy and ethics.]"

Anne, I have to disagree with you. Any current military actions being conducted in Afghanistan are done so under the guise of the current President as CC with the blanket war powers granted to the executive branch, and are carried out by his appointees to the department of defense.

Therefore any and all members of congress responsible for granting the current President these powers by vote is therefore indirectly if not directly responsible for the current military actions being conducted in Afghanistan. To attribute these actions to Obama alone, as though they are his personal decisions, or reflect the approach he would choose is fraught with inaccuracy and conjecture/supposition.

[anne]

Understanding just what happened in Georgia, Ossetia and Russia, in that order is important if we are to understand American foreign policy even in having indirect results. There needs to be a carefully done objective account in the American press, but to my surprise however naive there has been no such account. Similarly we need to know what we are about in Southwest and possibly more of Pakistan, but we have only a shadow or reflected understanding that is in no way satisfactory.

The need to know, is a need centered on an understanding of what our democratic obligation is. We are in a foreign policy maze of immense significance with remarkably little sense of what is going on. Knowing we are fighting in Pakistan, comes to late to have offered an opinion on whether we should fight in Pakistan. But, not only has the Administration taken away such possible opinion, even the political opposition has. Democrats find not the slightest problem evidently, as Obama has long made clear.

[anne]

Rufus:

"Any current military actions being conducted in Afghanistan are done so under the guise of the current President as CC with the blanket war powers granted to the executive branch, and are carried out by his appointees to the department of defense."

Absolutely right, which is why I have been complaining so for so many months. There is no reasonable political opposition on Afghanistan or Somalia, while Afghanistan looks increasingly threatening for us and both Afghanistan and Somalia are in terribly poor condition.

[rufus]

"But, not only has the Administration taken away such possible opinion, even the political opposition has. Democrats find not the slightest problem evidently, as Obama has long made clear."

Anne, here I believe some common ground. To me it is quite apparent that the current administration has no interest in transparency with regard to the actions and/or strategy of the executive branch. They have been entirely consumed with regaining executive powers they (the current administration) believe to have been usurped since Watergate.

I do wish the Democratic campaign would focus more on the lack of (or complete absence of) transparency with which the executive branch has functioned over the last 8 years, yet I fall short of determining this to be the Democratic Party's responsibility alone. I believe this because the right/demand to know is the responsibility of each and every individual American. Here I believe the Democratic Campaign is missing a golden opportunity, but shirking no more responsibility than any of the rest of us have over the last 8 years. For example, how many Americans have exhibited any interest in our troop/training activities in Georgia over the past several years prior to the current confrontation? One might say the media is just now bringing this to light, but I for one read about our activities there at least 3 or more years ago. I do not hold the media responsible for what they report any more than I hold myself responsible for what I read or watch. The media, without fail, will pander to the interests of the public. If Hollywood gossip is of more interest to the majority of Americans, you can bet that is what will receive the preponderance of coverage.

[hari]

Anne - Rufus

You're both right on Pakistan and Afghanistan.... (Iran is off the radar, so it seems!).

However, don't forget the troops cannot communicate in local language(s) nor understand what's being said - without an interpreter. BO/Biden will be foolish in directing current Bush/Rice policy in the region - without critical strategic review from ground-up + consulting SouthAsian nations on the way forward to peaceful resolution of the post-9/11 conflict.

[hari]

There is new development tonight in Ukraine...President and Prime Minister are at each other's throat...and government will surely come to a dismal failure to stay in power.

May be (I don't know) it's all timed for Cheney's visit this week.

Unlike Georgia, Ukraine has been historically an integral and cultural part of former Soviet Union. Kruschev, Brezchnev and Grobachev originated from the soil of Ukraine.

This is now fundamentally a cultural and geopolitical problem for the Orange Revolution.

[anne]

Also, beyond language problem among NATO or American soldiers in Afghanistan-Pakistan, remember that American reporters can seldom read beyond the English language press in Pakistan-Afghanistan and I am told there is a significant difference in news from English language sources. Translators are essential for complete reporting and attention should be given to who is using translation.

Iran is beyond dealing with given our military resources spread even to the Black Sea, not to mention having really lost Georgia as a possible staging ground at least for the present.

[anne]

Hari:

"There is new development tonight in Ukraine...President and Prime Minister are at each other's throat...and government will surely come to a dismal failure to stay in power."

All I understand is how complex the politics can be in the once Soviet republics, or even Poland or the Czech Republic. I keep pointing out the quiet in Georgian politics, as a puzzle.

[rufus]

"There is no reasonable political opposition on Afghanistan or Somalia, while Afghanistan looks increasingly threatening for us and both Afghanistan and Somalia are in terribly poor condition."

I absolutely agree. I think, however, this is depressingly reflective of the American Populace. For 7 years or more we have capitulated to the terrorists’ cause, in allowing ourselves to be terrorized and induced into military retaliation not to mention creating the entire bureaucracy of Homeland Defense (a demonstration/exercise in itself of extreme nationalism). What ever happened to the strategy of not responding to terrorist actions, not helping them accomplish their goals? Much like energy conservation, I think it died in the 70's. As Americans we are more concerned with our own appeasement and self gratification. Regrettably similar in Somalia, I believe the American view is that people have been starving and dying in Africa for decades. Which by no means should be trivialized, and I am absolutely not attempting to do. I actually find this quite disheartening. Americans seem to have accepted this as fact rather than responding to it as a challenge. Again our desire/obsession with our own satiation is bolstered by the fact the US (as our leaders exemplify) have no economic stake in Africa as we do in the Middle East. At least this appears to be the current climate of world view in this country. We, as Americans, as evidenced in the media, seem to have little concern for the injustices and plight of African nations. Thus the lack of hard investigative reporting, it won't sell. Cynical as that may sound, I believe it is realistic. This is an area where I believe economic theory can aid in interpreting global political strategy. The US will invest first with infrastructure or military in areas of the world where we have an economic stake.

[rufus]

"BO/Biden will be foolish in directing current Bush/Rice policy in the region - without critical strategic review from ground-up + consulting SouthAsian nations on the way forward to peaceful resolution of the post-9/11 conflict."

Hari, This may sound idealistic (although I never understood the negative connotation of that word), but I would hope for this same approach from McCain/Palin as well.

[hari]

As predicted here, full scale debate has started in EU Parliament based on the outcome of EU Summit (1/9). There are lots of q's (includes Anne's) which they're trying to find answers to right now.

I am still expecting them to summon Misha to come and provide his *raison detre* for the ethnic conflict. Misha wants to be recognized by EU with some form of membership into EU - Germans call it *preferred* membership - and Germans are dubious about his capacity for mischiev.

[Dutch papers have revealed that he's married to a Dutch lady.]

[anne]

Rufus:

"This may sound idealistic (although I never understood the negative connotation of that word), but I would hope for this same approach from McCain/Palin as well."

There is every reason to expect that the coming Administration will not repeat the mistake of the current Administration which appears to be letting ideology determine policy initiatives before consultation, and using pressure to limit consultation but in a self-defeating way. Remember the way in which the Administration was surprised by China repeatedly early-on, but having no way of pressuring China was at least there forced to be diplomatic.

[hari]

Rufus - Let me guote to you something I keep on my desk which Merkel used in her speech to Knesset/Israel:

*Wer nicht an Wunder glaubt, der ist kein Realist* - by Ben Gurian/Ex-PM/Israel.

*One who doesn't believe in wander, is not a realist* (my translation).

So, *idealistic* as it may sound to find an amicable solution to Taliban insurrection in Hindu Kush, it's practically feasible and currently being tried by Pres. Krazai. Because, in the medium to long term, there is no choice but to find a compromise with Taliban - and all other tribal leaders - and redevelop Hindu Kush to the hospitable land of plenty it was before Soivet intervention....

[anne]

Rufus:

"I do wish the Democratic campaign would focus more on the lack of (or complete absence of) transparency with which the executive branch has functioned over the last 8 years, yet I fall short of determining this to be the Democratic Party's responsibility alone."

This is critically important, as European Union delegates are learning in looking more to consensus.

[anne]

Hari:

*One who doesn't believe in wonder, is not a realist* (my translation).

-- Angela Merkel

So, *idealistic* as it may sound to find an amicable solution to Taliban insurrection in Hindu Kush, it's practically feasible and currently being tried by Pres. Karzai.

[Interesting.]

[hari]

Sep 8th meeting of EU troika with Medvedev/Putin will be a starting point for *course change* in The Caucasus. I still expect The Caucasus Stability Pact (dormant now for whatever reason) to be reactivated and implemented in Eastern Europe.

The EU idea is to give the people of The Caucasus some credible alternative to current impasse...and a better life.

All will have to compromise including Russia/Geeorgia.

FDI into Russia is currently held back for various political constraints, and Russia can't afford to miss the scale and level of EU transfer of technology and development offered by Italian, French and German private sector joint-ventures.

[hari]

Anne - Merkel is actually guoting former PM of Israel, Ben Gurian.

[hari]

Ho Chi-Min and VietCong can be compared to Taliban today.
Yet Kissinger set down with them and negotiated a *peace treaty* in Paris - during my time at OECD (1974-77) - which Nixon signed.

[rufus]

Hari,

*Wer nicht an Wunder glaubt, der ist kein Realist* - by Ben Gurian/Ex-PM/Israel.

*One who doesn't believe in wander, is not a realist* (my translation).

Thank you, food for thought.

Please do not misunderstand my remark when I say, "although I never understood the negative connotation of that word". This was not intended as a sarcastic reflection, but more as a statement of personal dissonance with the manner in which that term is often applied contemporarily.

[rufus]

"Ho Chi-Min and VietCong can be compared to Taliban today.
Yet Kissinger set down with them and negotiated a *peace treaty* in Paris - during my time at OECD (1974-77) - which Nixon signed."

Exactly, ideals not governed by a sense of pragmatism are notions fraught with frivolity.

[anne]

Oh, I would agree finding no inherent reason not to expect to be able to follow a diplomatic course not only for the European Union with Russia but for Hamid Karzai's government with the Taliban. The problem for Karzai actually may be a lack of clarity as to just which interest Karzai represents.

Presenting the Taliban, whoever they may represent at this time, as a unity and as impossible to negotiate with dictates a militarist's resolution to what seems impossible in military terms in a land so little unified as Afghanistan (Southwest Pakistan).

[anne]

Rufus:

"Ho Chi-Min and Viet Cong can be compared to Taliban today.
Yet Kissinger sat down with them and negotiated a *peace treaty* in Paris - during my time at the OECD (1974-77) - which Nixon signed."

Clever recollection to think about.

[hari]

Rufus - the real problem of understanding what's up in Hidu Kush demands some sense of idealism and of course reality check. Why? Because, like the Viet Cong, the land belongs to the people of Hindu Kusch. Whatever the outcome of current Nato intervention (there is a lot of debate tonight across German airwaves because their Defense Minister payed his respect to Pres. Karzai today and apologized for killing (?) civilians last week) they will eventually be gone sooner than later. German public is raising their collective disgust at pictures of civilan fatalities on their screens!

[anne]

The recollection was Hari's, echoed by Rufus. The point being how we can at least try to redefine and approach even to an impossible enemy as we would obviously do however grudgingly with Vietnam and with China. Had we supported Vietnam from 1974-1975, we just might have prevented the tragedy of Cambodia, but such support must at least have seemed politically impossible.

[anne]

Hari:

"Whatever the outcome of current Nato intervention (there is a lot of debate tonight across German airwaves because their Defense Minister paid * his respect to Pres. Karzai today and apologized for killing (?) civilians last week) they will eventually be gone sooner than later. German public is raising their collective disgust at pictures of civilan fatalities on their screens!"

[Interesting.]

* "Payed" has to do with paying out ropes.

[hari]

You see (our) Marquis/Lafayette calls GWB - *led-head*! There is a reason why he uses that syllogism...because the guy has introduced the most blatant form of *racism* after 9/11, into US foreign policy principally because of his youth and development, IMHO, and aided and abedded by Congress.

So I don't blame your mindset (and other's) for being more or less conditioned by US media into visualizing present global wars/conflicts with colored lenses - a la Americana!

[anne]

http://ebooks.adelaide.edu.au/y/yeats/william_butler/y4c/complete.html#part121

1936

Politics
By William Butler Yeats

HOW can I, that girl standing there,
My attention fix
On Roman or on Russian
Or on Spanish politics?
Yet here's a travelled man that knows
What he talks about,
And there's a politician
That has read and thought,
And maybe what they say is true
Of war and war's alarms,
But O that I were young again
And held her in my arms!

[I know, I know.]

[rufus]

Anne, Thanks for clarifying the citation to Harri's comment.

Hari, “Because, like the Viet Cong, the land belongs to the people of Hindu Kusch.”

Until the time that foreign countries with an economic stake in the region underwrite the possessor state, or rebellious state seeking control of the land.

U.S. Imports by Country of Origin
http://tonto.eia.doe.gov/dnav/pet/pet_move_impcus_a2_nus_ep00_im0_mbbl_m.htm

Note the increased imports from Russia. Thus a good time to leverage your advesary’s stake. How tough can the US honetsly afford to talk or act.

http://en.wikipedia.org/wiki/Baku-Tbilisi-Ceyhan_pipeline

Why Ossentia will not gain independence and US involvement in Georgia will not gain autonomy for the state.

[robertdfeinman]

Greg Mankiw says he has thousands of "friends", but still no one loves him. Do you think it has anything to do with his holier than thou attitude and his unwillingness to deal with comments on his blog?

I am a friendly guy
I now have over 2500 friends on facebook. Call me a pushover: I am ready to befriend anyone. (Try me again if, inadvertently, I have ever ignored your request in the past).

[anne]

Vladimir Putin knows the oil and gas market, and my way of making sense of Putin's plan for Russian development has been to watch how Russia oil and gas have been handled as the state became the controller of the resources. I remember reading years back that Putin even wrote a thesis on the energy market. So, taking control of energy even with no significant price increases Putin assured the state of a revenue flow where taxes were not sufficient and the revenue flow gradually began to build back Russia.

I wonder if this sort of development mechanism has ever been successfully used by a large mature state before.

[anne]

The pronounced energy price increases, along with the control Putin had taken of oil and gas resources, allowed for a speeding of Russian development in a way that should have been noticed by our State Department or intelligence analysts, but I am not sure there was notice since there was seemingly no political recognition of Russian economic strength as the strength should have been evident just reading the New York Times.

The idea was that Russian use of energy resources was almost illicit or vaguely amusing and had to be counter-productive or the revenues generated were taken on in corrupt fashion. I think not. I think we have another development pattern, as distinct as China's which we failed to recognize as such for too long or even till the current turmoil.

Did the Georgian leadership have any sense of what Russia was? I think not. Georgia's military melted away at the Russian show of force that must have immediate been understood as overwhelming.

[hari]

rdf - I also read that from Mankiw...and found it very intriguing indeed. Why doesn't he allow comments?

[Barkley Rosser]

Regarding how smart Putin is or not, I note that the value of the Russian stock market has declined by a full third since this stuff got going.

As for "securing Russia's borders," well, Georgia was not threatening them, did not invade Russia, did not threaten to invade Russia, and did not drop any bombs on Russia. But Poland now will have an anti-missile system (which probably won't work, however). Of course, Putin did say at one point that in going into South Ossetia and Georgia, Russia was defending "Russian citizens" (that is, South Ossetian citizens of Georgia to whom the Russians have given passports) on "the soil of Russia." Yes, he said that, a total lie. But then, what does one expect out of a man who has allowed the man who planted polonium on Litvinenko in London to be a member of the Russian duma?

[anne]

I imagine there is a thesis of student Putin floating about, a thesis suggesting how an understanding of energy markets might favor Russia. Did our intelligence analysts impress this on our political leadership as Putin was gaining control of energy resources from the "oligarchs?" Where does Russia's President come from now? From Russian state oil and gas management.

Putin understands energy, and we need to know that well.

[anne]

Ah, I have no sense how China's leaders or Russia's view the respective stock markets but I have never had any sense stock market movements are allowed to effect policy for either. Real estate values seem of more concern, but even here in a derivative sense. Growth is not looked to be directly reflected in the movement of asset prices. Similarly so for Venezuela, for now.

[Barkley Rosser]

Regarding Putin and the energy markets, realizing that there is a link between Russian (formerly Soviet) power and the price of oil and control of it, is nothing new. This was well known in the Soviet period. It is now widely argued by people like Yegor Gaidar that what really triggered the fall of the USSR was the collapse of the price of oil, which occurred in 1986, the last year the USSR recorded a positive growth rate in its GDP.

So, anne, please, let us not puff Putin up with some phoney brilliance for being a successful crook with his cronies who have managed to take over the Russian oil and gas industry, and have been showing their faces to various neighbors by playing with both prices and supplies for several years now.

Oh, and a lot of his cronies have money in the Russian stock market, where lots of money has been made. They most certainly do pay attention to it.

[Barkley Rosser]

[thought I posted this]

There is nothing brilliant in knowing that control of oil and gas is a key to Russian power, as it was during the Soviet period as well. Yegor Gaidar argues that it was the fall of the price of oil in 1986, the last year Soviet GDP rose, that triggered the fall of the USSR. So, please no speeches about how brilliant Putin has been in having himself and his cronies seize control of the oil and gas industry and use it to manipulate politically neighbors through prices and supplies, which has been noticed for some time, more ultimately self-defeating muscle flexing.

Oh, and I do not know about Putin himself, but certainly plenty of his cronies have made a lot of money in the Russian stock market. They most certainly do pay attention to it.

[hari]

Finally Cypus will be united, so it seems from today's meeting between the divided-family in Eastern Mediterranean, in a federation of the existing two (separate) parts.
Downer (Ex-FM/Australia) is the UN advisor on-the-job in Cyprus.

The Greek part is already inside EU/Euro.

Russian offshore banking is established on the warm-water shores of Cyprus. Recall Catherine The Great wanted to (ac)claim Greece into Czarist *sphere of influence* with a view to seeking access to warm-water shores for its fleet during winter months.

[kthomas]

hari, sometimes I can't tell if you're for or against Russian influence in the Med.

anne...$1 Billion....that's a joke. The city of San Francisco operates at, what, 4 times that. This President of Georgia made one mistake: trusting President Cheney. In return for his support, he get's a fractured country and $1 Bil to clean up the mess.

[robertdfeinman]

Hari, Mankiw dropped comments on his blog when he discovered that most of them were critical (or even mocked) his pronouncements. Apparently he is used to lecturing with no rebuttal.

One can only wonder what type of professor he makes. He's an authoritarian type who doesn't expect any dissent. This also can be seen in his writings which favor top-down control.

That he has to distort the data to "prove" his points also says something about his intellectual honesty.

[Julio]

Anne,

"The idea was that Russian use of energy resources was almost illicit or vaguely amusing and had to be counter-productive or the revenues generated were taken on in corrupt fashion. I think not. I think we have another development pattern, as distinct as China's which we failed to recognize as such for too long or even till the current turmoil."

Good insight worth thinking about further.

Barkley Rosser:
"Yes, he said that, a total lie. But then, what does one expect out of a man who has allowed the man who planted polonium on Litvinenko in London to be a member of the Russian duma?"
...
"So, anne, please, let us not puff Putin up with some phoney brilliance for being a successful crook with his cronies who have managed to take over the Russian oil and gas industry, and have been showing their faces to various neighbors by playing with both prices and supplies for several years now."

Good points too, but they do not invalidate Anne's.

Is her "new development pattern" a mafioso kleptocracy? Possibly. Or perhaps a classic fascist regime in the making.

Or possibly something else. It would behoove us to observe it and think it through.

Ditto for our leaders; notably absent from everything I've heard from them is any sense of what the Russian people want and how they see their future.

[Barkley Rosser]

Relying on a single natural resource to export is a lousy development pattern. Looks good when the price is high, but then things go to hell when the price falls. Also, the record is pretty clear that oil exporting countries tend to end up with lots of corruption, which Russia certainly fits, even though there are a few counterexamples, e.g. Norway.

[hari]

rdf - Thanks for the comments. That was useful.