Death and Living

Having been involved in several memorials following a death in the family, I became curious about how different people respond to the loss of someone close. I noticed that those who were more religious seem to have a more difficult time dealing with the loss than the less devout. This was curious since I assumed that a christian who believed in an after life would find it easier to deal with the loss expecting to be reunited with the departed in the near future. For a christian, death is just a different stage of life rather than a definite end as it would be for an atheist.

One observation that may explain the difference is that it appears that chrisitans may have a crisis of faith caused by the death of someone close at a time when their faith would be expected to comfort them. It was common to hear christians question why such a good person was taken now rather than later or why the departed was put through such a painful experience. Christians believe that death and living are guided by some master plan defined by their faith so the death was planned and required by their deity - there is someone/something to blame. Atheists see no mater plan and accept that death is just part of life, that in a universe which is 13 billion years old that passing this year or next is inconsequential and that biology, physics and probability dictate the eventual demise of everything that lives.

The bottom line is that it appears that a christian has to deal with two simultaneous blows - the passing of a loved one and a crisis of faith while an atheist only has to deal with one.

US Public Debt Reporting Out of Balance

Recent headlines report that the US public debt is approaching the congressionally mandated ceiling of $14.29b and that unless the debt ceiling is increased, the US will default on its debts and the government will be forced to shutdown. Unlike corporate America which reports its financial health using net debt, government accounts are reported in terms of gross debt. Perhaps this approach is preferred due to the fact that a firm where liabilities exceeded assets would be technically bankrupt. According to Economy Watch, US public net debt at the end of 2010 was $9.5t and is forecast to be $11.03t at the end of 2011 based on the current federal budget which is significantly less than the $14.3t public debt reported in the headlines. Net debt is defined as gross debt minus financial assets which include gold, foreign currency reserves, securities and other holdings but does not include non financial assets such as buildings and roads. Although the annual budget deficits contributed significantly to an increase in US public debt, a large percentage of the US public debt increase since 2008 was used to purchase financial assets of distressed US financial institutions through TARP and to purchase US Treasury securities as part of the quantitative easing programs. As of 6/15/2011, the Federal Reserve held $1.58t of US Treasury securities which is an increase of $793b from one year earlier. US public debt can be reduced by selling financial assets on the balance sheet without any change in the annual budget deficit. In the year to 6/15/2011, US public debt declined by $204b at the Federal Reserve from what it would otherwise have been through the sale of mortgage backed securities. Although an orderly sale of US financial assets over time would be required in order to avoid tanking the asset prices, the US government can finance operations for an extended period of time through the sale of financial assets without an increase in the debt ceiling. Although there may be good reasons not to sell assets in the short term such as the desire to maintain high levels of liquidity in financial markets and to avoid depressing equity prices, slightly depressed equity prices and lower levels of liquidity would be preferable to a US government default. Although the cookie jar is far from full, there are still more cookies left than the headlines suggest.

PM Netanyahu's Speech to Congress

I just watched Israeli Prime Minister Netanyahu's speech to a joint session of Congress (5/24/2011) and was surprised that the commentators after the speech said that there was nothing new and that this was a political speech. I think that Netanyahu's speech was pivotal.

Essentially, Netanyahu defined the settlement that Israel would accept and essentially told Obama to not waste time negotiating - here is the settlement and you can take it or leave it. Furthermore, the support that Netanyahu received from the US Senators and Congressman was essentially a message to the president that he, Netanyahu, and not Obama controlled the US Congress on the issue of Israel.

The settlement that Netanyahu presented would never be accepted by the Palestinians. The key points were that Palestinians would only have the right of return to Palestine and not to Israel (essentially conceded previously), that Jerusalem would remain undivided and under the control of Israel, that Palestine would be demilitarized and that Israel would retain a military presence in an Independent Palestine and along the Jordan River.

Netanyahu essentially stated that an independent Palestine would be an occupied territory with borders defined by the Israelis. Bottom line is that this independent Palestine would not be any different from the occupied Palestine that currently exists.

US Foreign Policy - US Interests versus Values

Periodically, most recently with regard to US foreign policy concerning the Arab awakening, the claim is made that US values frequently conflict with US interests. The interest for the US in the Mid-East is for a stable, generally secular, western friendly region which has historically been provided by local autocrats. The value generally claimed to be at conflict with US interests is democracy. Perhaps there is no conflict and the apparent conflict is just a matter of definition. Democracy is not an end in itself but a means to achieving goals. If a democracy leads to a fundamentalist Islamic government that persecutes people of other religions, limits education to religious studies for men only and recognizes few if any rights for women really in accordance with US values even if achieved via a free and fair election? Hussein in Iraq was an autocrat but he provided freedom of religion and gender equality which are key US values. If democracy leads to a civil war, are US values really served? If a country such as many of those in Africa doesn't have the institutions to support free and fair elections such as independent courts, media and election monitoring can a election really be expected to result in practices which are in accord with US values? If a country has an illiterate population with strong tribal loyalties arranged by geographic region it is likely that an election will result in an administration that is dominated by one culture or tribe which exploits the other tribes which usually results in a civil war.

I would argue that when comparing interests to values that an expansive definition of values is adopted with an assessment of what democracy will provide in light of a given nation's institutions and culture. I would also argue that stability is both a major interest and value of the US and is sometimes best served by an autocrat. The US has some ability to influence the policies of an autocrat through aid budgets and other means. Democracy as an alternative to an autocrat is no sure or quick thing. Democracy in some instances, will result in practices that are less in accord with US values than the previous autocratic government.

Western involvement in Libyan revolt

The major cause for the delay by the Western powers in determining their role in the Libyan revolt is the attempt to reconcile values with national interest and to reconcile short term tactics with long term strategy. In the short term, humanitarian imperatives caused by the Libyan regime’s willingness to use the military against civilians in rebel strongholds argues for immediate intervention. Once the regime’s military has entered the rebel cities there is nothing the West can do to prevent a slaughter short of a large military combat presence on the ground which is unacceptable. In the long term, the reluctance to support the rebels is based on not knowing whose interests the rebels represent or what tactics will lead to an end position that does not involve a bloody civil war or a divided country.

One option would be to proceed as follows;

1. The west would adopt a sanctuary zone concept with the zones surrounded by demilitarized zones say of 20 miles. Any regime forces entering the sanctuaries and/or attacking the sanctuaries would be destroyed by the Western powers. Any rebels leaving the sanctuary to go on the offensive would do so without any Western support.


2. A quarantine would be maintained that would prevent the current Libyan regime from importing any weapons or ordinance and Libyan assets would continue to be frozen. It would be helpful of the Algerian border and the southern borders could be monitored to prevent any imports to the Libyan regime of weapons and troops from these areas.


3. The rebel area would be provisionally recognized as a separate state entity apart from the current Libyan regime.


4. The Saudis would provide technical support to run the oil and gas industry and the Saudis would handle the sale of any oil and gas available for export. The Saudis alone would determine price and customer.


5. The French would provide administrative support, account for and dispense funds received from the sale of the oil to existing employees of state owned utilities and health and safety services.


6. The rebels would have a defined period of time, say 3 months, to adopt the core of a constitution, the framework for government and to elect representatives to the government. The Turks or Egyptians might take the lead in this effort.


7. All costs for infrastructure repairs, operation of services and cost for contractors assisting with the elections, formation of core government structure, etc. would be paid for by Libyan oil revenues.


8. If the Libyan government, government representatives and core constitution were acceptable to the western governments then the process to formally recognize the new government as the sole representative of Libya would be rushed to conclusion in the UN.


9. No military aid including weapons, ordinance or training would be provided until the new Libyan government was formally recognized.

Egypt - What Comes Next

I think it likely that Egypt will follow the road that Turkey followed in establishing a secular government. The West and the protesters want a democracy established in Egypt, Mubarak will not remain nor will his son be permitted to take the reins of government and a democratic election under the current rules would likely see the the Muslim Brotherhood gaining more influence than the Egyptian Army and large segments of the Egyptian population not to mention the West would tolerate.

Consequently, in the next 10 days I expect that Mubarak will leave Egypt, the military will take command in a caretaker role and will insist on a new secular constitution being developed after which elections will be held. Much like Turkey, the military will be given a position in government with the explicit objective of ensuring that a secular state is maintained.

Earmark Ban

The Senate today voted against a ban on earmarks claiming in part that earmarks are not expensive costing only $16b in fiscal 2010. However, there are some bills where earmarks are used to get enough votes to pass the bill which would otherwise fail and in these cases I think that you should count the total cost of the bill and not just the cost of the earmark in determining how much would be saved by banning earmarks.

Recall that when it appeared that healthcare reform did not have enough votes in the Senate to pass that an earmark was included in the bill which would pay 100% of Nebraska's additional Medicaid expense with the other states only receiving a 50% federal reimbursement of the increased Medicaid costs. Assuming that Nebraska's Senator Bill Nelson's vote made the difference between the healthcare reform bill passing, should you count the cost of this earmark as the $90 million in additional Medicaid reimbursement over 10 years or the $1 trillion of the new healthcare reform over 10 years?

The argument that earmarks are not a significant cost item is misleading.