Sleepycatz

It’s Raining Money

The Fed today decided to drop the target rate for Federal funds by 50 base points, to 4.75 percent. The board felt as though this was necessary to help stabilize investments in the mortgage and stock markets after the recent unpleasantness related to default rates and MSO devaluations. Of course, this sent the stock markets into a buying frenzy — putting the DOW at +300, as I write this. Wall Street loves cheap money that can be bandied about and thrown into risky investments. But at the same time stock trading surged, the global ramifications also became apparent: the dollar dropped to a record low and gold is approaching a record high — two signs that overall confidence in the American economy are waining. As borkafatty succinctly stated on Calculated Risk:

Consider this: In 2000, when Bush took office, gold was $273 per ounce, oil was $22 per barrel and the euro was worth $.87 per dollar. Currently, gold is over $700 per ounce, oil is over $80 per barrel, and the euro is nearly $1.40 per dollar. . . According to economist Martin Feldstein, “The falling dollar and rising food prices caused market-based consumer prices to rise by 4.6% in the most recent quarter.” (WSJ). That’s 18.4% per year—and yet, Bernanke is cutting interest rates and further fueling inflation?!?

With this cut, it appears the Fed is propping up a failing economic model. For the past several years, the American economy has been built on consumer spending and financial shenanigans. 70 percent of US economic activity is related to this consumer spending which has been fed by low interest rates resulting in ever rising consumer debt. As real world wages have remained stagnant, and food and transportation costs continue to rise, this system becomes unsustainable. At some point creditors will have to be paid and consumer spending will have to decline significantly. Without artificially high consumer spending a large portion of service jobs will disappear causing further recession. Our present economic situation is built on an illusion of free markets and a never ending, never inflating, money supply. This is the Bush policy of neo-reality applied to economics — “If I say everything is good, then by nature it is good”. This administration has tried to force their reality on the American people for years whether is was with regards to Iraq, Afghanistan, the War on Terror, Global Warming, or the economy.

Quick Thoughts

I have been fighting a nasty cold for the past few days, so I have been a bit out of it. Anyway, while working today I made the mistake of listening to Gen. Petraeus’ testimony before the House. I was struck by the blatant duplicity and obfuscation of the report he offered. His, and his supporters, constant over-hyping of the al-Anbar lie and ‘massaging’ of data was just appalling. Watching Petraeus on c-spann gave me flashbacks to my youth when I saw Gen. Westmoreland peddle his spin before congress nearly forty years ago. I have written before that I do not believe this administration will ever leave Iraq for geo-political reasons, but their need to keep up this facade that ‘we are making progress’ or that ‘we are fighting al-Qaeda’ is just infuriating. The entire purpose of todays farce was to create enough confusion to maintain the political bickering, ensuring that congress will be too befuddled or afraid to act.

I am also aware that today is the day before the anniversary of the events of September 11th, 2001. Six years later my heart remains saddened and troubled for those who lost loved ones and who continue to suffer in the aftermath. But I also find myself dreading the exploitation of anniversary. I fully expect the President and his supporters to again make use of this tragedy to aggrandize themselves and their disastrous policies. To watch these men exploit their own incompetence to seize more power and sacrifice more soldiers and waste more money is just galling. If these people ever had any sense of decency or respect they would just keep quiet this anniversary and let it pass without trying to exploit the fear or jingoism they have mired themselves  in for the past six year. But I doubt they have they have the humanity to keep their mouths shut.

Why America Will Not Leave Iraq

I don’t usually write about the situation in Iraq primarily because I feel that there are so many others who express my own feelings more eloquently then I seem capable of. Also, my views on the situation are a bit more pessimistic than those of most activists and pundits, and I have been told that it’s not helpful to voice such views to the public. Recently, however, there has been a lot of consternation about Gen. Petreaus’ upcoming report to congress and the question of will American forces stay in Iraq or leave. To understand the answer to this question — and US-Iraq policy in general — we have to look back nearly five years ago to the surge to war and understand the reasons and hopes surrounding the initiation of the invasion and the political philosophy which made it a necessity for this administration.

When the Bush administration came to power it had a single foreign policy goal: to establish America as the dominant world power of the 21st century. Seeing the only threat to this goal as the world’s lesser superpowers (Russia and China) the administration focused heavily in its first year on the deployment of an anti-ballistic missile system (aka SDI) and on excising itself from the 1972 ABM Treaty. A deployed anti-missile system, they believed, would have given America a strategic advantage in pressing its will throughout the world for years to come. Then came September 11th, 2001.

When the administration states that 9/11 changed everything, for them, it is no hyperbole. Their notions of projecting a strong, nearly invincible, America on the world were called into question that day. The way the administration viewed it, America’s allies and enemies had seen a small, disorganized, group of fanatics cause massive damage to America’s infrastructure and economy with little money or effort.

The administration responded first by inflating the perpetrators of the attacks. For instance: as Jason Burke has pointed out, prior to 2001 al-Qaeda was a loose association of violent jihadi who received much of their funding from a Saudi businessman named Osama bin-Laden, and who rarely, if ever, used the name al-Qaeda to identify themselves. The administration, however, quickly elevated the perception of al-Qaeda as a powerful leading Islamist terrorist organization. A definition al-Qaeda was egotistically eager to adopt.

The administration’s next responded by prioritizing its original goal of a world dominated by America; however, direct action was now necessary in addition to simple coercion. In 2003 during an interview with Charlie Rose, columnist Thomas Friedman said:

I think it [the invasion of Iraq] was unquestionably worth doing, Charlie.
We needed to go over there, basically, um, and um, uh, take out a very big state right in the heart of that world and burst that bubble, and there was only one way to do it.

Despite Friedman’s lack of eloquence, his viewpoint was shared by most Americans, but particularly so by those who believed in the one-world, one-superpower philosophy of the administration. In order to save-face and press America’s will around the world a strategic invasion was needed. Afghanistan provided little global strategic value, but Iraq was the goldmine. The perfect choice to begin a Pax-Americana.

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Unbelievable

It has become the worn cliché of our times to express one’s disbelief in the ineptitude and corruption of our government or its officials. The very idea that the government should aid its neediest citizens has become a nostalgic dream — a tail handed down from past generations. Two years ago this week, hurricane Katrina devastated New Orleans and surrounding areas. Our government was slow to respond and quick to blame. Two years later, after issuing billions of dollars for reconstruction, not a single one of the 115 critical projects identified by local government has been completed.

Conservative ideology has always been set on proving that government is less efficient and more wasteful then the private sector. The Bush administration went out of its way to accept this ideology and make it true. Instead of supplying funds to New Orleans, or municipalities it funneled money to large contractors like Halliburton early on believing that large private sector firms were more competent and appreciative then local business could be. The result has been a disaster for the people of New Orleans. Money has been moved away from public services like education, subsidized housing, and health-care and into charter schools, planned developments, and private hospitals. Instead of letting the people of New Orleans decide what the priorities of rebuilding were, this administration let the market decide. Some people have pointed to this as evidence of a conspiracy against the poor and middle-class of Louisiana, but there is no conspiracy: it is merely incompetence and greed.

The idea that private enterprise is more efficient that government has been accepted as gospel since the days of Ronald Reagan. It has never been true. Private enterprise is inherently corrupt - it has to be. It’s primary goal is not to deliver goods or a service, but to generate profit whatever way possible. Within that marketplace the only reason private enterprise delivers any quality of goods or services is due to competition and regulation. Conservative ideology was taken in by the notion that the larger and more successful a company the more competent it is. But when the government issues a massive contract there is no competition; the is no reason for the company to deliver goods or respond to the needs of citizens, and larger companies are inherently better at generating profits then delivering services.

The people of New Orleans are ready and capable of rebuilding their city, but this government, and its cadres, have withheld financial support. The people of New Orleans continue to suffer today because this administration is determined to prove its ideology of a low-tax privatized empire. It is beyond time that we recognized that this ideology is a failure, and return to the idea of a government for the people.

Joybubbles is Dead

I learned today that Joybubbles (aka Josef Engressia) had died on August 8th. I never knew Joybubbles, never spoke to him, but I knew of him. I had first heard his name some thirty years ago when I was shown my first bluebox, and heard how he had routed a phone call around the world to a phone next to himself just to hear his voice travel. Joybubbles, and others like him, inspired my generation of ‘hackers’ to learn about systems and how they work — to seize technology and harvest it where we could, to invent and aspire. Joybubbles lived a tragic life, but his legacy is vast and deep. You may never have heard of him, but the fact that you are reading this online means you owe him a debt of gratitude.

New Domain

Every few years I go through old domain names and get rid of some. When you have been working on the Internet for a number of years, you tend to collect domain names like old clothes. At one point, I had some 50+ domains, but, as I am not a squatter, I let them go over time. I have discovered that it takes about a year to clean out a domain; so I have begun with auroraliberty.com. The domain name and previous links will be redirected to this domain. Thanks

Fashion Police

At a time when people are beginning to realize the massive abuse and problems caused by the current intellectual property laws, in steps congress to expand and further confuse the system. Just prior to his summer vacation, Sen. Schumer (NY) introduced the Design Piracy Prohibition Act of 2007. Like pretty much every bill introduced in congress for the last 10 years, the name of the act has almost nothing to do with its function, and the small amount of media coverage of this bill has been erroneous at best. Of course, getting the media to intelligently cover copyright, or Internet issues for that matter, is like teaching  cats to play chess: they’ll knock around the pieces to amuse themselves, but will never understand the game.

Though billed as a piracy protection act, the bill goes far beyond that. Fashion designers are currently protected from knockoffs and piracy through trademark enforcement of their brands. One cannot, for instance, sell a leather handbag labeled as Coach if it is not made by Coach. Trademark enforcement is the bread and butter of litigation in the fashion world. Additionally, a designer may copyright a fabric pattern design under the existing classifications. This requires anyone wishing to use the pattern in their clothes to obtain a license from the copyright holder.

Schumer’s bill adds fashion design to existing copyright laws as an area of protection. This is a bureaucratic nightmare and a litigious boondoggle in the making. The proposed law defines the following as items protected by copyright:

A ‘fashion design’ is the appearance as a whole of an article of apparel, including its ornamentation.

The term ‘design’ includes fashion design, except to the extent expressly limited to the design of a vessel.

The term ‘apparel’ means:

an article of men’s, women’s, or children’s clothing, including undergarments, outerwear, gloves, footwear, and headgear; handbags, purses, and tote bags; belts; and eyeglass frames.’.

If this seems a bit ambiguous, you’re right. There is nothing denoting what constitutes an original design or the extent to which it is protected. For instance, if a designer attempts to copyright a pair of green pants with red pockets can they sue another designer who sells a pair of blue pants with red pockets? For that matter, does simply having a different colored pocket allow an item to protection, or has the idea been in circulation long enough it is public domain? Finally, how may ways are there to design a pair of pants, or a handbag, or a dress, or eyeglasses which does not derive from previous works? Unfortunately, questions like these an many many other will have to be answered through lengthy, complicated, litigation if the bill becomes law.

Finally, the fashion industry has survived and even thrived with a lack of intellectual property controls until now. As Kal Raustiala and Chris Sprigman pointed out last year in their paper “The Piracy Paradox: Innovation and Intellectual Property in Fashion Design,” the lack of intellectual property protection has actually forced the fashion industry to be more innovative and competitive then those industries with strong protections.

In recent years copyright law has become a cesspool of highhanded litigation and threats. The protection of intellectual property is suppose to allow for fair compensation to creators in order to encourage innovation. However, the opposite is becoming the norm. Innovation is being stifled by copyright litigation and confusion. To add, as Sen. Schumer wishes, fashion design to this already deepening pool is simply to add further litigation, and stifle competition and innovation. This bill will not give additional protection to designers from piracy, but simply add costs and create havoc in a marketplace is actually working quite well.