Friday, October 13, 2017

How I eat -- at home vs. away

Here's how I eat when I'm at home: A salad comprised of lettuce, green pepper, grape tomatoes, cucumber, carrots, and 1/4 cup of grilled chicken that totals about 200 calories, plus a coconut water.

Compare that with how I eat when I'm away on business trips. A grilled shrimp risotto with a Moscow mule, and when that was done, a peanut butter milk stout from the Belching Beaver Brewery. Total calories -- I don't know, but it was way more than 200, that's for sure. (The restaurant was right next door to the hotel and gave a 10% discount.)

I love getting per diem allowances.

Wednesday, October 11, 2017

South Korea's stolen battle plans

South Korean lawmaker Rhee Cheol-hee reported on Tuesday that North Korea's cyber army had hacked into the Defense Integrated Data Center in September 2016. Among the 235 gigabytes of data that were stolen were Operation Plans 5015, South Korea's "master plan" in the event North Korea invades. [Source]
And while -- yes -- the idea would be to "decapitate" the North Korean leadership in this event (a la Saddam Hussein), I don't think the plan had a lot of big secrets. The broad consensus has long been that a North Korean invasion would be futile, but they could sure mess things up along the way. Losing control of O-Plan 5015 doesn't change that.

As strange as it may sound, in a North Korean invasion the war would be the easy part. The hard part, according to an unclassified draft document by the Arroyo Center, is what South Korea and its allies would have to deal with besides the fighting.

For one, we'd have to deal with North Korea's nuclear capabilities. How would we keep North Korea from using its nuclear weapons against civilian targets? And how do we secure them so they aren't smuggled out of the country?

Two, how do we mitigate the MASSIVE humanitarian crisis that would follow a conventional artillery assault on Seoul? And how would we control traffic on the roads leading south?

Three, how do we evacuate all of South Korea's international community? This is a key strategic question, and the answer will impact how the world perceives our role in the war. Korea hosts roughly one million Chinese residents and students, along with another 550,000 from other countries (including 150,000 U.S.).

Just to get the Americans out would take about 1,000 C-17 sorties. But we wouldn't have all of South Korea's infrastructure to ourselves -- we'd have to share it with all the other countries trying to get their people out. And if we want China on our side (preventing what's called a "Theater Power Intervention"), we'd have to cooperate on this.

By comparison, in April 1975 Saigon had less than 7,000 foreign nationals.

Lastly, there's be the problem of dealing with a "catastrophic victory." Regime collapse in North Korea means South Korea would have to deal with reunification in a long-feared "hard landing" scenario. This means gaining 23 million or so (50% of its current population) impoverished North Korean citizens who would have to be educated and rehabilitated to work in the 21st century.

These are no small tasks, and there are no easy, obvious answers. Nor do they seem to be forthcoming anytime soon.

For all the bluster that North Korea puts out about the Allies' annual exercises (Key Resolve and Ulchi Freedom Guardian), they remain *command post* exercises. There's a lot of "hand-waving" that goes on during these events -- lots of glossing over complicated, inter-agency problems so our respective militaries can focus on the purely military aspects.

So while the breach of security is indeed embarrassing and inconvenient, the theft of O-Plan 2015 affects little when compared to the monumental challenges that lie tangent to military action.

Sunday, October 08, 2017

Fine! No football for you!

A few weeks ago, President Trump targeted former 49ers quarterback Colin Kaepernick for his protest against police brutality (Kaepernick didn't stand for the national anthem last season), referring to him as a "son of a bitch." [Source] In response, players across the NFL made their own displays of solidarity.

Some stayed in the locker room. Others linked arms during the anthem. [Source] This week, several 49ers (and a few cameramen) modeled what Kaepernick started doing after a conversation with former Army Ranger Nate Boyer, and knelt.
Well, Vice President Mike Pence didn't appreciate that, and walked out, writing, "I left today’s Colts game because [President Trump] and I will not dignify any event that disrespects our soldiers, our Flag, or our National Anthem." [Source] - (By the way, that PR stunt cost us $242,000)

I know there are a lot of people out there who feel similarly, but here's what I think:
  1. The president should listen to Donald Trump. The president wrote that, "Sports fans should never condone players that do not stand proud for their National Anthem or their Country. NFL should change policy!" Yet in 2013 Donald Trump wrote, in reference to Obama's comments on a Redskins name change, "...our country has far bigger problems! FOCUS on them, not nonsense" [Source] In my opinion, the president should take his own advice and focus on one of those bigger problems.

  2. Kaepernick's protest may be imperfect, but he's doing what he can. As he stated in 2016, "I am not going to stand up to show pride in a flag for a country that oppresses black people and people of color. To me, this is bigger than football and it would be selfish on my part to look the other way. There are bodies in the street and people getting paid leave and getting away with murder." [Source] While I disagree with his method of protest, I sympathize with what he's trying to accomplish. The nation's got problems, and he wants to bring attention to them.

    Unfortunately, the League is now involved, turning what had been a social justice protest into a generic display of "solidarity" with an embattled individual. [Source] In an organization where 70 percent of players are black, 83 percent of viewers are white, and there's not a single black CEO, majority owner, or president, I don't really expect either viewers or owners to share the same perspectives as the players. [Source] But it's a shame so many people are seeing this as a respect-the-flag issue instead of Kaepernick's original intent.

  3. It seems there's no good way for a racial minority to protest in this country. The two athletes who raised gloved fists in the 1968 Olympics were kicked out. [Source] If you say, "Black lives matter," you get drowned out by folks who insist that "all lives matter." And if you go to the streets, you're seen as violent or ungrateful.

    To me, it seems like black athletes are like modern-day gladiators: a subordinate class, paid to perform for others' amusement but not to confront them with uncomfortable realities. Muhammed Ali refused to serve in Vietnam, and was banned from his sport at his peak. Compare that with our president, who essentially did the same thing (four deferments for college, one for "bone spurs"). [Source] Does that not seem like an injustice?

  4. I don't like others using my service to disparage protesters. While I wasn't happy to see Colin Kaepernick sitting down during the national anthem, I understood that it wasn't really about disrespecting me, the flag, or the country.

    Yet Fox commentator Jeanine Pirro felt he and other NFL protesters have no grounds to protest this way -- that their huge wealth precludes them from griping. "There are so many of you who make tens of millions of dollars," she said, "why don't you get together and take care of the social injustice instead of disrespecting our country?" [Source] As someone who is supposedly "disrespected," I disagree with this perspective.

    While I've seen some veterans make sarcastic comments like, "That's what makes America great -- the people who've died so others can say this kind of thing," I don't think that's right. We who fight in defense of the First Amendment have a choice -- we can either fight for others' freedome to say things we might disagree with (and be honored for the selfless act), or we pass judgement on what others say and disqualify ourselves from receiving honor. We can't have it both ways.
So while I understand why some veterans are upset, I don't feel Colin Kaepernick -- or any of the current protesters -- is out of line. Although I probably would have not chosen to protest the same way he did, it's not my place to determine how best to use the freedoms I help provide.

Tuesday, September 26, 2017

Hero #17 Stanislav Petrov

Of the 1460 hits my blog has received over the past month, 650 have come from Russia. At nearly 45 percent, this constitutes a clear plurality -- more that twice as many hits as the next country. So it seems appropriate that I should honor a Russian patriot as one of my heroes today.

Back on September 26th, 1983, I was a third grader at Rutland Elementary School in LaSalle County, Illinois. Given that it was a Monday, I would have gotten on the school bus with my sister, sat with my friend Jon, and watched the rows in the corn fields go by like a million caterpillar legs during the 20 minute ride.

I would have sat in Mrs. Workman's class, probably taken a spelling test, and thanked God that Ms. Hoffman was no longer my teacher. She was my second grade teacher, and I remember her for both her mean attitude and all the skin tabs she had on the right side of her neck.

After school, I may have had basketball practice, and then waited for my mother to pick me up -- hopefully while it was light out. When I got home, I probably did my homework, and then played on our ColecoVision or Atari 2600 until it was time to go to bed at 8:30.

Yet of all the things I did that day, there's one thing I'm certain I didn't do: die in a nuclear holocaust initiated by the Soviet Union.
Earlier that day, and halfway across the world, 44 tear-old LTC Stanislov Petrov was a few hours into his shift at the Soviet Air Defense Forces when its early-warning satellites over the United States set off alarms.

Computers warned that five Minuteman intercontinental ballistic missiles had been launched from an American base.

Three week earlier, the Soviets had shot down a Korean Air Lines flight, killing all 269 people aboard, including a Georgia congressman. President Reagan had rejected calls for freezing the arms race, calling the U.S.S.R. an "evil empire." And Soviet leader at the time, Yuri Andropov, was obsessed by fears of an American attack. [Source] Clearly, it was a tense time.

Yet instead of reporting the alert up his chain of command, Petrov decided -- on a 50-50 guy feeling -- that it was a false alarm.

“I told myself I won’t be the cause of World War III. I won’t. Simple as that,” he said. “If they imprison me, OK. But something told me that over there, on the other side of the ocean, are people just like me. They probably don’t want war.” [Source]

At the time, we Americans were completely unaware of Petrov's actions. They only came to light in 1998, after political activist Karl Schumacher learned of his role in the incident.

He said that when TV reports started calling him a hero, he was surprised. "I was literally just doing my job." [Source]

Nevertheless, at the time Petrov's actions earned him an official reprimand -- for making mistakes in his logbook. [Source]

Sadly, he passed away on May 19th, at age 77. Though I didn't know about him in his lifetime, it's fair to say many on Earth today are alive -- at least in part -- because of his cool and sound judgment. What he only suspected was true: that there were, in fact, people on the other side of the world like him -- people who did not want war.

Perhaps there's a lesson here for others in positions of power.(1)(2)

Saturday, September 23, 2017

Review: One Nation Under Gold, part 1

All over the world, the U.S. dollar is a symbol of American strength. As a fiat currency, this seems appropriate, since the value of the dollar is based on the relative strength of the U.S. economy (among other things, yes).

So why, then, did a return to the gold standard come up during the Republican primary debates? What do they have against an independent dollar?

Americans have long regarded gold with a peculiar fascination, and gold's influence is felt throughout much of our history. The earliest Jamestown settlers hoped to find it, gold rushes have fed its mania since the 1790s, and even during the Great Recession it served as the ultimate secure investment.

Even today, there are those who argue that a return to the gold standard would help alleviate many of our economic problems. So then, why does every economist recognize this as a certifiably BAD idea?

To understand the benefits and disadvantages of such a decision, it would help to look at the history of America's relationship with gold, and that's what James Ledbetter's One Nation Under Gold is about.

Ledbetter traces the role gold has played since our independence, and in the process shows that the desire to acquire, amass, and control gold has played an powerful role in our economic and political history.

Yet before reading the book, it would helps to understand three underlying economic principles.

First is that money serves two functions. It serves a medium of exchange in that it's more useful than lugging around an ox looking for something to barter with. The only problem is finding something that's valuable to people you deal with and in just the right quantities to make it rare but still accessible. Money also serves a store of value, so it needs to be something that's not prone to mold, rust, or decay.

To meet these needs, different things have served as money in different places and times, with corresponding advantages and disadvantages. Rice worked well in 1600s Japan because everyone could use it (land value was even determined by how many koku (石) of rice it could produce), but it didn't work well as a store of value. Wampum worked OK in America's pre-colonial period as a storage of value, they weren't universally accepted.

Precious metals like gold and silver work well for both these functions, but not perfectly. If the world economy really collapses in a massive, apocalyptic crisis one day, all the gold in the world won't help you find something to eat. It will lose its value. And as a store of value, precious metals are more vulnerable to theft.

The second principle is that no matter what you use as money, you can control only two of three variables: convertibility, interest rate control, and price stability. In the 1980s, Argentina pegged its currency to the U.S. dollar to end its inflation problems. It got convertibility and price stability, but lost its ability to control interest rates. In 1997, prices and interest rates in China were mostly unaffected by the 1997 Asian financial crisis, but this was because it had instituted currency controls (sacrificing convertibility).

And in Japan's "Lost Decade," you can see problems with price stability. Japan maintained convertibility with the world economy, and lowered its interest rates to almost zero. Nevertheless, this wasn't enough, and in the days before "Quantitative Easing" the destruction of capital resulted in deflation.

With a gold standard, a country essentially pegs their currency's value to that of gold. If new gold mines are discovered, the currency experiences inflation. If you raise the interest rate to combat inflation, it may hurt the economy at a really bad time. If there's a discrepancy with the interest rate, gold may flow out of the country. And if you institute currency controls to limit that, you cut yourself off from the global economy. When the U.S. operated on a gold standard, the dollar saw all of those things.

Third is that time will force you to change your choices, and usually at a time that's not of your choice. The Argentinian economy bubbled when the U.S. interest rate was too low for what the Argentine economy needed, and when it crashed it had to break its dollar peg. To better integrate with the world economy, the Chinese did the same, and adjusted their currency controls. And the United States, facing an increasing flow of gold out of the country throughout the 1960s, had to finally drop the gold standard in 1973.

With these principles in mind, the American experience with gold will make a lot more sense. The next post will cover each chapter in One Nation Under Gold, and talk about how developments throughout the world led to changes in the U.S. dollar's relationship with gold.

Friday, September 15, 2017

Hero #16 Simone Veil (#78651)

The Economist wrote an excellent obituary on French stateswoman Simone Veil in its July 8th issue. The Holocaust survivor passed away on June 30th, at age 89 -- just a few weeks before my grandfather (and at the same age). French president Emmanuel Macron called her life an exemplary inspiration. According to a statement,
"Her uncompromising humanism, wrought by the horror of the camps, made her the constant ally of the weakest, and the resolute enemy of any political compromise with the extreme right." [Source]
Veil grew up in Nice as one of four children. In 1944, just a few days after taking the baccalaureate exam, she -- along with her mother and a sister -- were sent to the Auschwitz concentration camp. She never saw her father or brother again, and her mother died of typhus a few weeks before the April 15, 1945 liberation of the camp.

After the war, Veil trained as a lawyer, rose in political stature, and as health minister in 1974 brought women's right to the forefront of debate in the National Assembly.

Challenged to refute any moral equivalency between the Holocaust and abortion, Veil replied:
“I say this with total conviction: Abortion should stay an exception, the last resort for desperate situations. How, you may ask, can we tolerate it without its losing the character of an exception — without it seeming as though society encourages it? I will share a conviction of women, and I apologize for doing it in front of this assembly comprised almost exclusively of men: No woman resorts to abortion lightheartedly.”
Veil will be curried in the Paris Pantheon, alongside Victor Hugo and Voltaire, a distinct honor. Earlier, she was also granted the distinction of membership in the Academie Française, which included the customary ceremonial sword. It bore three engravings:
  • Liberté, Egalité, Fraternité (the French Republic's motto)
  • the European Union’s Unie dans la diversité,
  • and 78651, the number tattooed on her left forearm.

Thursday, September 14, 2017

Brady's tax reform plan

On my way to work this morning, I listened to an NPR interview with Texas Representative Kevin Brady. As chairman of the House Ways and Means Committtee, he is a leader in the Republican charge to overhaul taxes.

A number of things he said caught my attention, because they seem like deliberate attempts to benefit the top 1 percent of earners. For example:
"We're going all in for growth, you know, on jobs and paychecks. And if we do that right, look, we can improve the lives of every American. And so we're really taking our time to get those bold pro-growth policies right."
First question: What does he mean by "all in for growth"? Does it mean cutting taxes in the hope that it will stimulate the economy and we'll get more tax revenues later (i.e. "supply side economics")? Because that doesn't actually work. [Source] President Bush cut taxes in 2000, but it didn't help the economy to grow any faster than it did in the 1990s, and it didn't result in higher tax revenues.

And then there's the part about paychecks. Only 51% of American taxpayers owed any taxes on their April 15th federal returns. (Mitt Romney caught hell for this criticism about this in 2012.) The rest either don't make enough money (~25%) or are exempted because they're working families with children or are elderly (the other ~24%). [Source]

This is the case with me. Even as a captain in the Army, I don't make enough taxable income to owe federal taxes. Part of this is because of tax strategies and retirement accounts, but that's how the system is.

So the claim to "improve the lives of every American" makes me wonder what he's talking about. You can't lower taxes on the 49% who don't pay them.

Oh! But you CAN lower taxes for the other 51%, and pretend that "every American" benefits. This group, by the way, happens to include the top 1% of earners.
So, obviously, we want to, for families, lower tax rates at every level and simplify the code so much that 9 out of 10 Americans will be able to file using a simple postcard style system
Second question: How do you simplify things so much you can fit a tax return on a postcar? Answer: a more regressive system.

Currently, things are more complicated because higher income folks pay a higher percentage of their income. So your first $18000 may be taxed at 10 percent, but your next $75,000 will be at 15 percent. It goes up from there.

The call for "a simpler tax code" sounds nice, but there are tax softwares specifically designed to mitigate this issue, and they're not really all that expense. What Bradyreally means by "simpler taxes" is lower taxes for those highest earners who pay higher percentages.

And we want to focus - to balance this within the budget over time. And so part of it comes from stronger economic growth. But, also, that alone won't complete it. So you have to jettison a lot of special provisions for some - lobbyist loopholes, exclusions, all that - so we can lower tax rates for everybody. That's part of going to a much simpler tax code.
Third question: When you say "over time," what kind of time frame are we looking at? Because the following sentence sounded an awful lot like that "supply side economics" we discussed earlier.

And what kinds of exclusions do you mean? Because closing loopholes will only affect one of two types of people -- those who don't already pay taxes and those who do. Without more details, "closing loopholes" to me sounds like another way of saying making "raising taxes on people who don't deserve it."

I look forward to more details on the tax reform plan, but not at the expense of regular folks nor to the benefit of the richest 1 percent. We'll have to see what happens...