Crow for breakfast; the GDP numbers are in

The BEA just released its preliminary 1st quarter GDP numbers, which indicate that GDP increased slightly during the first quarter. What a stunner!

The increase in real GDP in the first quarter primarily reflected positive contributions from personal consumption expenditures (PCE) for services, private inventory investment, exports of goods and services, and federal government spending that were partly offset by negative contributions from residential fixed investment and PCE for durable goods. Imports, which are a subtraction in the calculation of GDP, increased.

Assuming that the numbers hold up through revisions, they indicate that the economy has not tipped over into recession.

One note with the numbers is that they appear to be strongly affected by changes in national defense spending, which increased 6 percent in the first quarter, compared to a slight decrease in the previous quarter. Inventories also grew, adding to short-term growth. Nearly every other indicator was weaker in the first quarter compared to the previous one.

Defense numbers aside, this shows why I never made it as a macroeconomist.

Promise 'em anything and everything

During her stop in Greensboro yesterday, Sen. Hillary Clinton signed on to Sen. McCain's irresponsible and ineffective idea for a gas- and diesel-tax holiday.

The main difference between the two senators' proposals is that Sen. Clinton would close some tax loopholes, end some subsidies, and impose a windfall profits tax for energy companies. While these would offset the revenues lost from a tax break at the pump, they would also undermine the consumer benefits of the gas tax break by raising operating costs for oil companies. Thus, her proposals would be even less effective, if that's even possible, than Sen. McCain's.

As additional evidence of Sen. Clinton's generous spirit, The Hill has reported that Sen. Clinton is poised to become the Senate's earmark queen. Sen. Clinton has proposed $2.3 billion in earmarks for next year's budget--nearly three times the bounty that this year's most profligate senator was able to secure. To give some perspective, the total amount of earmarks for this year's budget was $16.9 billion.

It would be easy to dismiss Sen. Clinton's gimmicky proposals as silly and unrealistic were it not for Congress' stubborn enthusiasm for simultaneously cutting taxes and raising spending. Sadly, the longer this presidential campaign goes on, the sillier the ideas become.

Democratic negativity

While Senators Clinton and Obama continue to wrestle in the mud pit, the Democratic National Committee has decided to throw some mud toward Senator McCain as well.

It's too bad that neither of the Democrats has much positive to offer and that the negative national campaign has started so early.

Mixed economic news

This morning brought some mixed economic news. There was a glimmer of light in the insured unemployment data, as new UI benefit claims unexpectedly fell by about 10 percent from the week before. The overall number of people receiving jobless benefits also fell. Given other indicators in the economy and recent trends, these numbers had been expected to climb.

While that news is good, it's too soon to break out the party balloons. The number of people claiming new jobless benefits and the total number of people receiving benefits are both up substantially from a year ago. Also, the UI claims data were accompanied by some other negative indicators.

The Census Bureau reported that new orders for durable goods fell 0.3 percent in March, following declines in January and February. At the same time, inventories of durable goods increased 1.1 percent to their highest level since the Bureau started tracking them using the current industrial classification in 1992.

The Bureau also reported that new home sales in March dropped another 8.5 percent from the month before and were down an eye-popping 36.6 from the year before. Sales were estimated to be 60 percent below their levels from March 2005 and at a 16-year low. So despite declines in home prices and the Fed's lowering of interest rates, the housing market continues to spiral down.

The many negative reports over the last few months have been indicative of a decline in economic activity. Next Wednesday, we'll see whether that has actually occurred when the Commerce Department reports the prelimary 1st quarter gross domestic product numbers.

Pander Bears

To an economist, some policy proposals sound like fingernails being dragged down a chalkboard. That cringe-making scritch, scritch, sccrriittch came through loud and clear this week, as each of the Presidential hopefuls made awful tax-related panders.

On the left side of the chalkboard was the pledge made by both Sen. Clinton and Sen. Obama during their debate in Philadelphia not to raise taxes on middle class families.

Sen. Clinton: I am absolutely committed to not raising a single tax on middle- class Americans, people making less than $250,000 a year.

Sen. Obama: I not only have pledged not to raise their taxes, I've been the first candidate in this race to specifically say I would cut their taxes.

So the Democrats have joined Sen. McCain in making wildly irresponsible income-tax pledges. The federal government is currently running an enormous deficit and faces exploding entitlement costs for its old-age medical and retirement programs. To that, Senators Clinton and Obama would each add huge new health insurance schemes, while Sen. McCain would extend our costly involvement in Iraq.

The tax pledges are inconsistent with these other promises. Moreover, the tax pledges are inconsistent with the candidate's previous positions. So the voters now need to decide what each of them is lying about--their tax pledge, their commitments to narrowing the budget deficit, or their other big-ticket spending items.

On the right side of the chalkboard was the other whopper of a tax pander by Sen. McCain, who introduced legislation to rescind the federal gasoline tax over the summer.

The federal government already acts as an enabler to the country's gasoline addiction, subsidizing producers and setting the gas tax pitifully low. Sen. McCain's "solution" to the nation's gasoline binging and its accompanying environmental, economic, and national security problems would be to lower gas prices by 18 cents a gallon. However, this would only make the addiction worse, while adding to the deficit.

Instead of pandering to the public, the Presidential candidates need to show leadership, which begins by explaining the tough budget and energy problems that we face.

Somewhere Paul Tsongas is weeping.

Economic downturn deepens and spreads

The Board of Governors of the Federal Reserve reported that economic activity across the county "weakened" over the last few weeks.

In its previous Beige Book report six weeks ago, the Fed indicated that the economy had stopped growing and had probably begun declining. The new report is more pessimistic and indicates a deepening and spreading downturn.

From the current report:

Reports from the twelve Federal Reserve Districts indicate that economic conditions have weakened since the last report. Nine Districts noted slowing in the pace of economic activity, while the remaining three--Boston, Cleveland, and Richmond--described activity as mixed or steady.

Consumer spending, transportation services, real estate, construction, and financial services were generally weak, while tourism, health services, and agriculture were bright spots.

The Fed faces some tough choices as inflationary pressures also appear to be building, with wholesale prices up sharply, retail prices up moderately, international oil prices hitting new records, and the dollar falling. Further cuts in interest rates might stimulate the economy but could also add fuel to the inflationary fire.

Privatized tax debt collection not the bonanza that Congress thought

To the Republican-led Congress in 2004, limited privatization sure seemed like a win-win solution to the tax debt collection problem. At the time, the Internal Revenue Service (IRS) effectively "wrote off" many potentially collectable but small tax debts because of staff limitations. Staff prioritized the cases that they worked on, and time was spent on big cases that could recover large revenues.

Congress's idea was to turn smaller, "easy" cases that weren't going to be collected anyway over to private collection agencies (PCAs). The agencies would receive a commission of 25 cents for each overdue tax dollar collected, returning the other 75 cents to the treasury. This looked like a textbook case in how to increase government efficiency through privatization with the private companies profiting from the commissions, and the Federal government recovering more tax revenues.

So why is the Washington Post reporting that the program is losing money? Well, technically, the Post is wrong. It appears that the program probably brings in a small amount of money each year (I write "probably" because the IRS does not collect enough data to calculate the full costs and benefits).

According to testimony given to the House Ways and Means Committee on March 18 by the National Tax Advocate, the PCAs generated $23 million in gross revenues. The PCAs received 25 percent of that ($4.6 million) back in commissions, and the IRS spent $7.65 million administering the program. So the net return to the government was $11 million, which hardly put a dent in the more than $300 billion in tax arrears.

Even these meager returns may be overstated because they don't account for tax cases that complain or appeal and thus use additional government resources. Also, they overstate the effectiveness of the PCAs, because roughly a quarter of the cases respond to an initial letter sent out by the IRS and before ever being contacted by a PCA.

The benefits also neglect the opportunity cost of the $7.65 million that the IRS spends on administration. Suppose that the PCA program were shut down and the $7.65 million were redirected toward other under-staffed debt collection efforts. The IRS estimates that it could collect at least $13 for each dollar spent, or about $100 billion--far more than the $23 million collected by the PCAs and without paying commissions. Thus, on an opportunity cost basis, the government is foregoing about $73 million by administering the PCA program instead of directly collecting the debts.

The National Taxpayer Advocate has described numerous other problems with the PCA program.

The program originally began with three companies, but one company was let go because it mishandled taxpayer data. The PCAs have generated numerous complaints because of their heavy-handed tactics. Also, the incentives of the PCAs are misaligned from those of the government, leading to cases where the PCAs push immediate debt collection but jeopardize subsequent tax compliance. Finally, the PCAs are tightly constrained in terms of what they can do--for instance, they can't negotiate debts down and can't investigate tax mistakes.

Why then does the private collection program continue to operate? Direct campaign contributions from the companies involved to Congressional supporters might explain some of it. Good old fashioned corporate cronyism and corporate welfare are other explanations. Lastly, there is an unabiding faith by some in the wonders of private efficiency, even in situations where there is ample evidence to the contrary.

Before the next tax day rolls around, Congress should eliminate this boondogle.

Billy Yow's contribution to race relations

Guilford County has many wonderful things going for it; however, the poisonous state of local race relations is not one of those things. Several local politicians seem to thrive on putting a stick in the racial hornet's nest and stirring things up.

The following banner from the re-election web-site of Guilford County's District 5 Commissioner, Billy Yow, is a great case in point.



Yow, if you don't know or couldn't guess, is the person with the very concerned look, who is shown in color on the left. Who or what concerns him? Well, the banner shows that it's the Democrats on the commission, most especially one of the black commissioners, Skip Alston who is depicted in the background on the right.

Yow uses the standard visual tricks of a negative campaign ad. He's removed the color from his antagonists' photos to show them in black and white. The shot of Alston is tightly framed by the "Yow" lettering and the border to make it appear closely cropped. Alston is photographed at a slightly downward angle and is tight-lipped and glaring over his glasses. All of which combine to make Alston look especially sinister.

There's another strongly implied message in the visual and that is that Yow is keeping Alston in his place. Yow is clearly in the foreground, in front of the text. Alston is in the back, behind the text. Also, because we naturally read from left to right, Yow is at the beginning, while Alston is at the end. The choice of yellow even gives a sort of schoolbus framing to the picture.

The text of the page reinforces the antagonistic message. It doesn't mention any demonstrable accomplishments. Instead, Yow "demands accountability" (presumably from Alston and the other no-account Democrats), "ask(s) the hard questions," "is always willing to take on the challenge," and "isn't afraid of a good fight."

While some might think this is over-reading, Yow freely admits that the ad targets Alston. When questioned about the lay-out of the ad, he told the N&R Scoop that "When you look you see Skip (Alston) sitting over there. And without me, you see, he's a loose cannon." The Scoop reported, "Yow added that voters in his district should vote for him at least to keep Alston under control." So, there's no question about the intent of the ad.

People are generally turned off by negative advertising, and the citizens of Guilford County are especially turned off by the endless racial bickering. They deserve a commissioner who can offer them something positive. Maybe Billy Yow can grow into that positive role; if he can't, he deserves to be retired.

Innocents

In response to questions posted to Jihadist web-sites, Al Qaeda's second-in-command, Ayman al-Zawahiri, ducked out of his cave long enough to assert that "We haven't killed the innocents."

Most of al-Zawahiri's rantings are best ignored. However, his lie that innocents haven't been deliberately murdered must not stand unchallenged.

Please let me tell you about four innocents that should be with us today.


Professor Leslie Whittington was a colleague from Georgetown University, when I was teaching at George Washington. She, several colleagues and I organized a monthly workshop on population and family economics that rotated around different univerities, institutes, and agencies in Washington.

Leslie was an accomplished and productive researcher, but she accepted the demanding (and largely thankless) administrative task of an associate deanship at Georgetown. After several years in the associate dean's position, an upcoming sabbatical was going to allow her to return to her research.


One of the immense joys of academic life is the occasional opportunity to travel to fantastic places to conduct research. Leslie had found such an opportunity at the Australian National University in Canberra. She and her husband, Charles Faulkenberg, had arranged for them and their two young daughters, Zoe and Dana, to spend the sabbatical there.

That opportunity put the family on American Airlines flight 77, which was to take them from Dulles to LAX on the first leg of their trip. They perished when al Qaeda's murderers plunged their flight into the Pentagon.

There is no question that Leslie and her family were innocents, just as there is no question that al-Zawahiri, bin Laden, and the hijackers are and were their killers.

America is divided about many things, but we should never forget that the struggle against al Qaeda is a fight to eradicate the world of a horrific evil that does indeed slaughter innocents, exults in that slaughter, and promises more.

The Iraq Quagmire

As the Iraq war enters its sixth year and as the nation mourns the 4,000th service death in that war, the Bush administration is sending yet another of its Iraq promises down the memory hole. This one tells you all you need to know about the quagmire in Iraq.

Announcing the troop surge in January 2007, President Bush told us that his then-new policy of increasing troop levels and holding the Iraqis to a strict set of benchmarks would "hasten the day our troops begin coming home" and said that "the Iraqi government plans to take responsibility for security in all of Iraq's provinces by November." He also faulted his critics--the Iraq Study Group, Congress, and most of the American people--who wanted a draw-down rather than a build-up in U.S. forces, saying that such a course "would result in our troops being forced to stay in Iraq even longer."

As we now know, the benchmarks that were the lynchpin of this strategy were abandoned within a few months. And by September, President Bush announced a new policy of "return on success," that is, U.S. troops would return home as conditions permit.

For the last few weeks, the President and Vice President, along with the Republican presidential candidate, Sen. John McCain, have been touting the many "successes" in Iraq. Apparently though, there is not enough "success" to allow forces to return in meaningful numbers. The New York Times reports that the President is planning to keep troop levels through 2008 at or above their pre-surge levels.

Since the surge was announced, we have known that it could not continue past this spring. The military was stretched to its capacity. Without extreme measures such as a draft, there simply aren't enough forces to maintain the extra troops in Iraq. The modest troop reductions that are occurring now reflect that underlying constraint. They are reductions from the height of the unsustainable surge, not reductions from our pre-surge levels. Thus, we can't move forward with more troops, even if that were a worthwhile policy.

In remarks last week, the President said that "gains we have made are fragile and reversible." Indeed, with Iraqi civilian casaulties rising through the first three months of this year, it appears that the security gains from the surge--the only measurable improvement of the policy so far--are being reversed. Now we are told that another critical outcome, the return of troops, is unlikely to occur. So, we can't move backward either.

Success should mean that Iraq is moving closer to assuming responsibility for its own security. However, the Iraqi government will be no more capable of maintaining security this November than it was last November or the November before that. The surge was supposed to be an investment toward a permanently secure and democratic Iraq. Instead, it has just dug us deeper into the quagmire, with genuine success appearing to be as illusive as ever.

End to a bad economic week

The Bureau of Labor Statistics released its February 2008 job numbers this morning; the news wasn't good.

From the survey of business establishments, seasonally-adjusted non-farm payrolls dropped by 63,000, the second monthly decline. From the survey of households, seasonally-adjusted employment dropped by 255,000.

The seasonally-adjusted unemployment rate fell (you read that right) from 4.9 to 4.8 percent. The fall is largely an artifact of the way that unemployment is calculated--as the ratio of unemployed people to people "in the labor force." The survey data indicated the number of people in the labor force shrunk by nearly half a million people. The rate is also an artifact of seasonal adjustment; the unadjusted unemployment rate is 5.2 percent.

However you cut them, these are pretty dreary numbers, especially coming on top of weak numbers from December and January. And regardless of whether the economy has plateaued or dipped downward, workers appear in for a bumpy ride.

First reports of negative growth

The Board of Governors of the Federal Reserve System released the latest installment of its Beige Book, a summary of economic reports from the 12 districts that make up the system. The Beige Book gives an early look at economic conditions around the country. The current report is very downbeat:

Reports from the twelve Federal Reserve Districts suggest that economic growth has slowed since the beginning of the year. Two-thirds of the Districts cited softening or weakening in the pace of business activity, while the others referred to subdued, slow, or modest growth.

While the report avoids the "R" word, it should be noted that the last two reports have cited ever-slowing growth and GDP growth over the period covered by those reports was an anemic 0.6 percent. Further slowing strongly suggests that the country has tipped from net growth to net decline.

Other indicators from the economy are also downbeat. Indicators for manufacturing and service sector conditions showed declines last month, and two private job reports also showed declines.

Who "lacks the courage"

Prof. Joseph Stiglitz, a Nobel laureate and the former chief economist of the World Bank has co-authored a book called, The Three Trillion Dollar War, that puts the price of the war in Iraq at, well, three trillion dollars (note to Joe, let's try to get a little more suspense into the next book).

For the service of attempting to calculate what our current policies are actually costing us, Prof. Stiglitz was immediately denounced by the White House. Spokesman Tony Fratto said, "People like Joe Stiglitz lack the courage to consider the cost of doing nothing and the cost of failure."

Mr. Fratto has it wrong. It is President Bush who lacks the courage to give straight figures and straight facts to the American public.

A courageous President would have told the American public up front what the costs were likely to be in terms of both lives and money. Instead, he fired his National Economic Advisor, Lawrence Lindsey, after Lindsey estimated the war would cost $100-$200 billion instead of the administration's then-prevailing estimate of $50 billion.

A courageous President would allow the press to photograph military caskets and might even attend some funerals himself.

A courageous President would include the costs of the war in his current and future budgets. Instead, he continues to fund the war through a series of "emergency" appropriations. Funds for the war are omitted from the most recent budget request. If you dig through the documents, you will find that the administration "anticipates" asking for $70 billion in emergency funding for Iraq and Afghanistan for FY 2009, even though costs for its wars have been several times higher in recent years. The administration refuses to disclose its estimates of costs beyond FY 2009 (September 2009).

Prof. Stiglitz has published his numbers, courageously making them available for all to see and criticize. In contrast, President Bush hides his estimates, and when questioned lashes out at the patriotism, motivations, and courage of his opponents. The President's repeated deceptions and evasions aren't exactly hallmarks of courage.

Steroids cause obstruction

There's been an active discussion in recent months of a Republican strategy to block basically any and all federal legislation proposed by Democrats. For instance, the Senate has already set a session record for filibusters--and there's still nearly a year to go in the session. Seizing on then-Sen. Trent Lott's comments early in the session that "the strategy of being obstructionist can work or fail … and so far it’s working for us," Democrats have taken to calling the GOP, the "Grand Obstructionist Party."

While calls of obstructionism fly back and forth every session, you really have to wonder whether there really is something behind these charges when Republicans take to stalling bipartisan legislation on steroid misuse.

C'mon folks. Get something done.

School Climate Task Force

The Guilford County Board of Education held a special meeting last night to receive a report from the School Climate Task Force, a group that had been charged with examining ways to address behavior problems and policies in the schools.

The task force was made up of school, parent, and community representatives and met with numerous groups in numerous settings throughout the county over the first part of this school year. They did an enormous amount of work.

Their report is likely to be heavily criticized, in good part because it makes some very expensive and wildly unrealistic recommendations, such as capping the size of all high schools at 800 students and lowering the student-teacher ratio all classes to 17-1. The report also lacks focus, mentioning lots of issues, big and small, without prioritizing or considering how some recommendations might work at cross purposes.

There were some themes in the report, however, that should be useful to the Board of Education and to the schools.

First, even though the entire school system is supposed to follow a common code of conduct, the task force reports that there is a lot of inconsistency with the administration of behavioral policies. Some of this is natural and actually good. Different administrators, different students, and different situations will lead to different implementation. As the Board goes forward, it needs to think about policies that people can live with and realize that one more policy laid on a bunch of others isn't going to accomplish much.

Following the consistency theme, discipline itself is a process. Developing discipline requires thought and planning. The district sets guidelines. From there, the schools each need a plan, and individual classrooms need plans. A lot of people (including me) assume that these plans are in place, but the task force's report suggests otherwise.

The task force advocated one particular planning approach, the Positive Behavior Support (PBS) approach, which emphasizes pro-active and encouraging strategies to prevent rather than react to behavior problems. PBS is currently being implemented in a handful of Guilford schools. There is some evidence that it is associated with better behavioral and educational outcomes. My guess is that those outcomes owe as much to the school community planning for discipline as anything.

One thing that undermines consistency is loading the schools up with so many policies, so many initiatives, and so many reports that no one is able to implement any of them effectively. It appears that many of our schools need to implement better procedures, but we need to recognize that if they are doing this, time is taken away from something else.

All of which gets us back to priorities, if we are serious about accomplishing something, we need to be realistic and recognize that we can't support twenty big initiatives. From all of the items in the report, it looks like school-wide planning would have the biggest immediate pay off.

Possible McCain financing troubles

This morning's post commented on a sweetheart loan deal between Sen. McCain's Presidential campaign and a Maryland bank in December. Because of the Senator's then-risky prospects, the bank required him to secure a $1 million loan with the promise of repayments from the publicly-financed Presidential Election Campaign Fund for primary candidates.

The "sweetheart" part of this was that the bank tried to word the agreement in a way that the Senator would not be committed to actually enter the public financing system unless his campaign tanked. Normally, using public financing as collateral is supposed to lock a candidate into the public system then and there.

The McCain campaign drew up certification papers to enter the public system. However, after its victory in the New Hampshire primary, the campaign decided to forego the loan and tried to withdraw those papers.

The Federal Election Commission (FEC) has now informed Sen. McCain that it might not allow him to withdraw those certification papers. The FEC gives two reasons. First, the FEC cannot form a quorum to decide on the withdrawal. Second, it asks for more information regarding the loan.

Public financing in the primary campaign would provide Sen. McCain with some additional funds but would also restrict his fundraising and spending between now and the convention.

Sen. McCain has said that he wants to enter the public system for the general election. He has also criticized Sen. Obama for waffling on a pledge to stick to public financing in the general election.

Sen. McCain may find the restrictions of the public system binding him much sooner than he would like.

Dumpster diving

The New York Times and the Washington Post each have stories this morning regarding a female lobbyist's access to Sen. John McCain in the run-up to his 2000 Presidential Campaign.

The Times story is premised in terms of Sen. McCain being so sure of his ethics that he sometimes overlooks the appearance of impropriety. The paper takes this as its license to rehash the 1999 events, the Senator's role in the Keating Five scandal, and a few other ethical lapses.

The WaPost article just digs straight into the dirt, focusing on the lobbyist's interactions with Sen. McCain and his staff's efforts to intercede.

While both stories are breathlessly reported, they cover events that occurred nearly a decade ago. Also, although it may have receded from people's memories, the influence angle was extensively reported back in 2000. So, the only "news" is the personal relationship with the lobbyist.

These are trashy and moldly stories that contribute virtually nothing to people's understanding of the issues in the current campaign. There are many more recent and relevant issues to explore, such as the evolution of Sen. McCain's positions over the decade and the sweetheart loan deal that kept his campaign afloat.

The Times and Post can do better.

A considered response to fearmongering

Halloween came early to the White House lawn yesterday with President Bush resorting to fearmongering and demonizing in his latest attempt to renew warrantless wiretapping and to sidestep judicial review of his previous extra-constitutional exercises.

Among his warnings:

If Congress does not act ... our ability to find out who the terrorists are talking to, what they are saying, and what they are planning will be compromised. ... And that, of course, would put the American people at risk.

Failure to act would harm our ability to monitor new terrorist activities, and could reopen dangerous gaps in our intelligence.

Our intelligence professionals are ... waiting to see whether Congress will give them the tools they need to succeed or tie their hands by failing to act.

...we better be worried.

Ewww, scary stuff. If Congress doesn't act, the terrorist threat will surely jump to code orange tomorrow.

To review, the President initially secretly authorized warantless wiretaps that went beyond the procedures spelled out in the Foreign Intelligence Surveillance Act (FISA). After his own Department of Justice balked, he demanded that Congress give him the authority to continue these activities, which Congress did ... for a while.

While the President has resorted to scare tactics numerous times, he has never demonstrated that suspension of the FISA provisions was actually necessary. When asked directly what "practical impact" Congress' (in)action would have, he said

There will be a gap. And of course, we won't be able to assess that gap until the time. Step one is, I guess you got to come to the conclusion that there's a threat to America, or not a threat. And evidently some people just don't feel that sense of urgency. I do. And the reason I do is I firmly believe that there's still people out there who would do us harm.

Secondly, I know that the tools that I've just described are necessary to protect us. Why? Because we need to know what people are saying, what they're planning and what they're thinking. And the tool that I have just described has been very effective.

That's the best he can do.

The President is also looking for immunity for the phone companies that helped him in his extra-legal searches. The lack of immunity is probably actually his biggest fear, as it would expose his activities to an independent judiciary.

In a considered response to the President's fright-fest, the Democratic chair of the House Permanent Select Committee on Intelligence, Rep. Silvestre Reyes calmly reminded the President:

Today, the National Security Agency (NSA) has authority to conduct surveillance in at least three different ways, all of which provide strong capability to monitor the communications of possible terrorists.

First, NSA can use its authority under Executive Order 12333 to conduct surveillance abroad of any known or suspected terrorist. There is no requirement for a warrant. There is no requirement for probable cause. Most of NSA’s collection occurs under this authority.

Second, NSA can use its authority under the Protect America Act, enacted last August, to conduct surveillance here in the U.S of any foreign target. This authority does not "expire" on Saturday, as you have stated. Under the PAA, orders authorizing surveillance may last for one year – until at least August 2008. These orders may cover every terrorist group without limitation...

Third, in the remote possibility that a new terrorist organization emerges that we have never previously identified, the NSA could use existing authority under the Foreign Intelligence Surveillance Act to monitor those communications.

He concluded

We are a strong nation. We cannot allow ourselves to be scared into suspending the Constitution. If we do that, we might as well call the terrorists and tell them that they have won.

Of course, that call may be monitored.

There are many legitimate things to be scared of, such as the consequences of the President's sub-prime lending acquiescence or living in a FEMA trailer, but not his latest channeling of Joe Isuzu.

Guns don't kill astronauts--astronauts kill astronauts

A Florida TV station is reporting that the crew on the International Space Station (ISS) has access to a gun. While some might question the wisdom of putting a gun in a confined, high-stress, pressurized environment, it could actually come in handy in any number of situations, such as deterrring home invasions, warding off Muslim extremists, protecting the crew from the Vice President, or defeating rogue computers.

The statistics bear this out. To date, the ISS has the planet's lowest crime rate. A well-armed space crew will keep it that way.

Developing obituary

Polaroid has announced that it is closing the manufacturing lines that produce its instant film. The company had stopped manufacturing instant cameras some time ago and now will stop producing the film that goes into them. The decision will cost about 150 jobs.

Polaroid was a genuine innovator in the photography field. For those too young to recall the days before digital photography, cameras required film, and most exposed film had to be taken to a developer. Polaroid's "instant" film was self-developing. The earliest films required that you wait a few minutes after taking a picture and then peel a foil cover sheet off of the exposed film. The film didn't work well if the air temperature was too hot or too cold (or if you were too impatient). The whole thing was an ecological nightmare with the extra foil cover that needed to be discarded, a smell like a small refinery, and a sticky surface on the picture itself. Moreover, the film was very expensive and pretty much one off (copies, we don't need no stinkin' copies). BUT you got a picture in a few minutes, and if necessary you could retake the picture before your cousins left, the vacation ended, the casket closed, etc. The alternative for standard film cameras waa to wait until the entire roll of film to be exposed, wait some more for it to come back from the developer, and then discover that your finger had been partially covering the lens.

Polaroid later created a different instant film with one sheet that developed before your eyes. The effect was vaguely creepy as images would begin to emerge, ghost-like, out the milky film.

One of my great thrills growing up was discovering my parents' discarded land camera in the early 1970s and finding out that it still worked (this find and the discovery of their stash of Beatles albums were shocking evidence of their happy pre-Dave existence). I used the camera for a few months until a combination of allowance, odd-job money, and flat-out begging yielded sufficient funds for a 35mm single reflex camera. I'm not sure what happened to the land camera after that.

Instant films made an important appearnce in grad school. The Ph.D. program at Brown took instant pictures of all of the incoming students. Pictures were then placed on a bulletin board, and the pictures from previous cohorts of students were moved farther along the board. The first tip-off to what we were about to endure was how much smaller the second-year cohort was (and always was) from the first. The other thing that we eventually noticed was that they stopped labeling the cohorts after they got past the fifth year. The pictures for this finite yet still sizeable set were just arranged under a label "Nth year."

Instant films reappeared at my first academic job. Economists hold an annual convention and conduct nearly all of their screening interviews at this convention (if it's January and you see about 10,000 people with enormous foreheads and a strict aversion to tipping, you know that we've come to your town). Penn State was regularly on the market for several positions and conducted dozens and dozens of interview each year. To keep track of the hordes who had ventured through the interview suite, someone on the recruiting team initiate the interview with a Polaroid picture of the candidate. This was an unsettling start to the interview. Besides the obvious "ew" factor, the flash temporarily blinded you and left you describing your dissertation to a group of disembodied blue dots. The "ew" factor was compounded later when I discovered that one faculty member's pictures consistently had women's heads higher in the frame than men's.

Digital cameras, which are now standard in cell phones, have all of these "conveniences" and much better picture quality. Their pictures can be printed, sent as e-mail or phone messages, shown as slide shows or posted on-line. Hopefully, they'll continue to produce as many memories.