More on Dubai Ports World

KipEsquire doesn’t think that the Dubai Ports World deal is such a good idea.  His opposition appears to be on two grounds.  First, a company owned by the UAE is inherently risky and second the UAE doesn’t have a good human rights record.

On security grounds it is certainly understandable that the public should be concerned and the Bush administration has failed miserably in recognizing that there would be an outcry – they should have come to the table with facts and arguments to defend their position.  However I think that some of the facts that Kip presents are a bit less than meaningful.

Kip rightly points out that inside information of the ports and port operations would be a boon to a terrorist plot and that only 20% of people living in the UAE are citizens.  I don’t see how this is relevant since the ports are located in the US and will be operated by Americans or people that are legally permitted to work in the US.   All any terrorist group would have to do in order to achieve this insider information would be to get a mole employed at any of the companies operating a pier at a major port – “friendly government” cooperation isn’t even necessary.

He then tosses out a couple facts about 9/11:

two of the 9/11 hijackers were from the UAE.

And

the UAE was the clearinghouse for laundering funds used to finance 9/11.

Does this paint all citizens and businesses located in the UAE as terrorists fronts?  Unless there is a tie between these individuals and business and the government I fail to see the importance.  Richard Reid (the shoe-bomber) is a British citizen and Zacharias Mousawi is a French citizen.  Should we be similarly wary of business deals with our European allies?

The argument is then transitioned into human rights concerns with two non-sequitors

--There is no clear border between the UAE and Saudi Arabia -- only a treaty that both countries refuse to make public.--There are no elections of any kind in the UAE.

When deciding whether or not the port deal should go through I can’t think of any reason these items should come into the decision making process.

On the human rights front one needs to consider if marginalizing a country with a poor human rights records is a net positive or a net negative for the citizens of the country and the long term interests of the US.

I am of the opinion that when you marginalize a country you get one of two outcomes more often than not.  First, the economic sanctions will not have a significant impact on the ruling party – they are essentially stealing wealth from their citizens anyway so if the net wealth of the country declines then the percentage of theft simply increases.  And if the wealth and comfort or the ruling class stays static then they have no incentive to change their behavior but the livelihood of their citizen declines.  So in essence we have harmed the people that we are ostensibly trying to help.

The second outcome is that we are successful in destabilizing the ruling class but the likelihood that a pro-Western ideal emerges is essentially zero resulting in a result that is probably not in our long-term interests.

So Kip is right in pointing out the weakness in human rights in UAE, but I’m not sure that punishing them economically is the right course of action.  I would also like to point out that if all Middle East countries raised their standards to those of the UAE it would be a vast improvement; so holding them up as an example for their neighbors is not necessarily a bad thing.

Reasonable people can disagree whether or not the lease of several piers at US ports is in the national security interests or not but I think it is a mistake to overlook the incentives that such a deal would create.  I don’t believe that having an Arab country with a financial stake in US security is a terrible thing to encourage.

Anti-Arab Rhetoric

InstaPundit has a pretty good thread of responses to the uproar over a deal that would give a UAE company control over some US ports.  Most of the points I would make are covered but I think Congressmen (and women) should ease the rhetoric more than a little bit.

If I was an Arab watching the interplay it would just confirm my suspicions that America hates Muslims  This particular company operates ports around the world and UAE has been a willing ally to our endeavors in the Middle East so there is no plausible reason to deny them the lease beyond their ethnicity and religion.

Our politicians should be ashamed of themselves for kowtowing to such a blatantly racist point of view.

Price At the Pump

Eric, over at GrimReader has a fantastic narrative on how market pressures such as supply and demand can influence gasoline prices. I’ll quote a small excerpt here, but read the whole thing.

One morning, the station operator gets a call from his supplier, telling him that they lost power to the refinery and won't be able to make his delivery this week. That's a problem, because at the rate he is selling, the tank will be empty by the Tuesday and most of his business comes on Friday and Saturday.
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He has a couple of options: shorten his hours, shut a few pumps down, or raise prices. You can see three other stations from his property, so shortening the hours and shutting pumps down to create an artificial shortage is only going to lose market share and do nothing to address his fixed costs, so he thinks about raising prices.

Blogger Book Exchange

Introducing the Great Blogger Book Exchange!

Inspired partly by December’s Great Blogger Christmas Card Exchange - though mostly by lamenting that no one clicks through my ads, so I don’t have any disposable income to purchase any of the books on my Wish List – I thought it might be a novel [pun intended] idea to great a sort of interweb book swap going.  Lord knows that I have books lying around that could find good homes and I assume others may be in the same boat.

My basic concept is that I would:

1. Maintain a list of all the bloggers that wished to participate


2. Link to each bloggers list of books available – books wanted


3. Each participating blogger would maintain said list including an optional review/rating for the books


4. Someone wishing to initiate a swap (though reciprocal sharing wouldn’t necessarily be required) would contact the current “owner” of the book and they would arrange transportation for the book.


5. The “owner” would ship the book to the “buyer” with a list of previous “owners” including their blog site and city of origin.  

The “buyer” would thus become the “owner” of the book and the cycle would continue.  If this idea sounds intriguing to anyone, drop a comment letting me know you are interested and I will start the process.  And if you think it is colossally dumb – let me know that too so that I know someone is out there and reading!

A Connecticut Senator in King Arthur's Court

I have found myself reading Mark Twain’s A Connecticut Yankee in King Arthur’s Court, mostly because it was a free to download it to my SmartPhone which gives me something to read while on the treadmill – though I have hardly regretted my choice.

Anyway, it strikes me how similar Twain’s characterizations of royalty are to our modern politicians.

And the people! They were the quaintest and simplest and trustingest race; why, they were nothing but rabbits. It was pitiful for a person born in a wholesome free atmosphere to listen to their humble and hearty outpourings of loyalty toward their king and Church and nobility; as if they had any more occasion to love and honor king and Church and noble than a slave has to love and honor the lash, or a dog has to love and honor the stranger that kicks him! Why, dear me, ANY kind of royalty, howsoever modified, ANY kind of aristocracy, howsoever pruned, is rightly an insult; but if you are born and brought up under that sort of arrangement you probably never find it out for yourself, and don't believe it when somebody else tells you. It is enough to make a body ashamed of his race to think of the sort of froth that has always occupied its thrones without shadow of right or reason, and the seventh-rate people that have always figured as its aristocracies -- a company of monarchs and nobles who, as a rule, would have achieved only poverty and obscurity if left, like their betters, to their own exertions.

It is almost as if Twain is peering through the mists of time into the Halls of Congress where hack politician after self-important bureaucrat passing judgment on the masses; imposing upon themselves the difficult decisions of health and wealth that we – the unwashed masses – are incapable of making for ourselves.

And for this we thank them and gleefully pay our due, our hard earned wealth and ask for more regulation, more intrusions upon our liberties that were hard won by our forefathers.

They were freemen, but they could not leave the estates of their lord or their bishop without his permission; they could not prepare their own bread, but must have their corn ground and their bread baked at his mill and his bakery, and pay roundly for the same; they could not sell a piece of their own property without paying him a handsome percentage of the proceeds, nor buy a piece of somebody else's without remembering him in cash for the privilege;

These men (and women) glory in spending our money to fund their own pet projects or those of their cronies. They ponder what simple pleasure is destroying our lives so that they can take it away while we nod and thank them for the trespass – long forgotten is their oath to serve and defend the Constitution.

Take a jackass, for instance: a jackass has that kind of strength, and puts it to a useful purpose, and is valuable to this world because he is a jackass; but a nobleman politician is not valuable because he is a jackass. It is a mixture that is always ineffectual, and should never have been attempted in the first place. And yet, once you start a mistake, the trouble is done and you never know what is going to come of it.

Well said Mr. Twain.

Illinois Power Crisis

I had blogged early about Illinois’ collision course with an electicity crisis. Fear of change has caused the legislature to enter deer-in-headlights mode and maintain the status quo.

If passed into law, a proposal calling for an extension on the current electric utility rate freeze would have serious consequences for every resident and business in Illinois, ComEd Chairman and CEO Frank M. Clark said today. "Freezing rates when ComEd's costs to buy power are increasing would be irresponsible public policy and would have a profound impact on our state," said Clark. "Without the ability to recover the increased costs for power, ComEd's financial viability will be immediately threatened, potentially triggering a crisis not seen in this country since the California energy crisis of 2001."
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With ComEd's financial condition weakened by an extension of the rate freeze, access to capital would be more expensive and would result in higher overall costs for the company and for consumers. In that event, suppliers in the wholesale electricity market would be reluctant to do business with ComEd since payment from the company would be uncertain. The result would be higher costs for wholesale power that would ultimately be paid for by consumers.

If the proposed legislation is enacted, the situation could also have negative consequences on reliability. With a revenue shortfall in 2007 projected at $3 million per day, ComEd would find it difficult to make the needed investments in the electricity grid that now serves 3.7 million customers across Northern Illinois.

ComEd’s assessment of immediate calamity should come with a grain of salt, they have every incentive to make the picture look worse than it really is. However, ComEd is still charging late 90s pricing for late 2000s power which is a recipe for disaster. Without, at least, a consistent revenue stream infrastructure upgrades and other necessary preventative maintenance will grow increasingly rare as the company struggles.

This means increased electricity outages that will culminate in the brown-outs and rolling black-outs that marred California in 2001. Of course this time evil capitalistic [supposedly] free-markets won’t be the convenient scape-goat.

Who Watches the Watchers?

Chicago residents strongly support the installation of security cameras that monitor streets, sidewalks and other public places, a survey finds.

A Chicago Tribune/WGN-TV poll of 700 Chicago registered voters finds eight out of 10 are in favor of surveillance cameras used as a means of combating crime.

Currently, a few thousand surveillance cameras are used by the city,by the Chicago Transit Authority, Chicago Housing Authority and other local agencies.

However, Chicago Mayor Richard Daley has endorsed a plan that would allow more Chicago businesses to use surveillance cameras in spite of opposition from business groups.

Do you think that the respondents would change their answer if they were asked if they minded people like this watching everything that they do?

A former Indiana police officer linked by the FBI to a string of bank robberies in five states has been indicted in three Illinois holdups

The problem with ubiquitous surveillance isn’t when government and government employees are doing what they are supposed to be doing. The problem is when they abuse their position and power.

Much Ado About Wi-Fi

Chicago wants to create a city-wide wireless Internet signal that would allow residents and visitors to surf the Web from anywhere.

The city this spring will solicit bids from technology companies to build and offer the wireless broadband -- or Wi-Fi -- service.San Francisco, Milwaukee and other cities also are working to build city-wide wireless Internet service.Chicago officials say the project would allow easier Internet access to low-income people and would attract businesses to the city.

City technology guru Chris O'Brien said yesterday that the system would be paid for by whatever private vendor is chosen to build it.

I was all set to blast the city of Chicago for another costly measure that was bound to fail, but this just has me flabbergasted. Chicago wants a vendor to come in, build a network – on their own dime – and offer the server at “low” rates so that the poor can afford it.

Why wouldn’t a company do that of their own volition? Isn’t that basically how markets work? Isn’t this also what is already happening in Chicago? It has one of the densest populations of Wi-Fi of any city in the country. Exactly what incentives are city bureaucrats offering companies to extend the service into underserved neighborhoods?

About the only criticism I have of this press release is the concept that municipal Wi-Fi would somehow attract business. Businesses would never leverage the service so I’m not sure what attraction there would be that someone would choose Chicago over another (presumably non-Wi-Fi) city.

The long and the short is that this is much ado about nothing.

Fungible Commidities

The world is a sad, sad place when a cartoon dog understands economics better than 80% of Americans.

Congress Is Smarter Than You

The New York Times reported this week that Congress has exempted itself from the D.C. smoking ban, which takes effect next month. Although smoking will be prohibited in bars, restaurants, and other indoor workplaces, members of Congress will continue to light up in the Capitol. This special treatment is of a piece with the exemption for cigar bars, the sort of upscale joints that legislators, lobbyists, and other insiders tend to patronize.

Why does Congress feel that they are smart enough to decide for themselves whether or not smoking is harmful while the rest of us are too dumb to make the decision for ourselves? Such blatant disregard for individual preferences is extremely frustrating.

HatTip: Hit & Run