Iran, Nukes, Peace: Part I

I didn't see it when it came out but, due to continuing controversy, I recently bumped into the International Atomic Energy Agency's report on developments with regard to nuclear energy within the Islamic Republic of Iran, a report issued in November 2011. For those who want a link: here.

One big issue these days is whether Iran has been preparing a bomb of a sort -- or preparing for a situation in which it could rapidly assemble a bomb in a final few-weeks-long breakout -- that could reasonably instigate an Israeli pre-emptive strike, and even what seems to have been the assassination of Iranian nuke scientists by the Mossad.

Here are some pertinent passages from the IAEA:  "Since 2002, the Agency has become increasingly concerned about the possible existence in Iran of undisclosed nuclear related activities involving military related organizations, including activities related to the development of a nuclear payload for a missile, about which the Agency has regularly received new information." That's a ten-year period (but who's counting?) -- time enough to have accomplished something.

More recent news?  The IAEA has "had direct discussions with a number of individuals who were involved in relevant activities in Iran, including ... an interview with a leading figure in the nuclear supply network," i.e. a clandestine international network that provides goods, services, and information pertinent to weaponization of nuclear materials.

In general, the IAEA says that it "has serious concerns regarding possible military dimensions to Iran's nuclear programme. After assessng carefully and critically the extensive information available to it, the Agency finds the information to be, overall, credible."
In general, the report uses diplomatic language but leaves one with the clear  impression that Iran does not now have nuclear weapons, but has been working toward that end, and will likely have nuclear weapons in the near future if not blocked.

I recently came across -- was directed to -- an AlterNet essay called "10 Myths About Iran -- and Why They're Dead Wrong." The overall theme of the essay is that there is no good reason for the rest of the world, including Israel, to regard itself as threatened by Iran.  I applaud their pursuit of the goal of peace, and I agree that the calls for war -- yet another war! -- require resistence. For reasons I will discuss in Part II, I can't let that stop me from pointing out sloppy reasoning when I see it, and AlterNet is guilty of some. Again, here is a link.

Alternet starts off by debunking the myth that Iran already has a bomb. For this purpose, it prominently cites the International Atomic Energy Agency.  Fine with me.

As the second point of its list of ten, Alternet then debunks the "myth" that Iran is "rushing to build a nuclear weapon." I sniff here a whiff of wordgamesmanship.  Like scrabble but not as fun. At what point in the development of such a device is one "rushing" to do it. If they've been working on it at a deliberate pace, but they've been doing so since 2002 or so, they might well be near completion even without any "rushing"!

So let's just interpret this "myth" as the view that Iran may well be close to completing work on a nuclear weapon. That "myth" is, according to the IAEA as we've just seen, not a myth at all, but their inference from years of study.

Alternet treats IAEA as a sound authority for debunking the first "myth" and then simply ignores IAEA when dealing with the second. Alternet doesn't say, "yes, IAEA supports this, and they are sometimes right as we've just acknowledged, but we think they are wrong this time because [give reason here.]" No ... in making their second point, Alternet just lets IAEA drop out of the discussion altogether!

This is lame on the face of it. If they have a good reason for believing IAEA a good authority on some subjects then they should at least be worthy of an explicit mention with regard to a closely related second point. If there is good reason to reject IAEA's statements on that second point, why not let us in on it?  If they believe IAEA an unreliable source generally, why bring them up at all? 

And what evidence or source would hold weight for AlterNet in coming to believe something they don't want to believe? If the answer to that last question is "none," then that answer renders all other questions rather moot, doesn't it?

Further, there is no reason to believe it beyond them, sanctions or not. This isn't some state-of-the-art thing. This is 1940s technology. It's like making a radio with vacuum tubes. Heck, North Korea is capable of it.

A related point: the technology for delivering it is of 1940s vintage, too. You don't need a North-Pole straddling ICBM to get a bomb from Qom to Tel Aviv. You only need the sort of missile that Von Braun was making, in wartime conditions. Von Braun was working in conditions of greatre hardship  than anything the sanctions have created for Iran, in German held territory in the summer of 1944. It was high tech then, of course. It isn't high tech now.

In January, the Federation of American Scientists put out their own report on the subject. Its conclusion:  "We are still in a stage where the numbers of new centrifuges Iran installs and
their effective performance have significant effect on its time to a bomb. As total enrichment capacity
at FEP grows and especially as Iran continues to stockpile 20-percent uranium, we are entering a phase in which Iran’s enrichment capacity will no longer be the important rate-limiting step in producing a bomb because breakout time will be in the order of weeks, not months."
It is very possible, even IMHO likely, that Iran is working to position itself for a 'breakout,' a quick period of the final assembly. What is more clear is that Israeli policy makers are quite rational in worrying about such a possibility.

There is a difference between war-fighting weapons and deterrence weapons. The US and the USSR faced off for decades with huge stockpiles of deterrence nuclear weapons. They didn't try to hide these from each other. In fact, they were quite public about their respective arsenals, because weapons don't deter anybody unless the other fellow thinks or knows you have them. So if you have the weapons for deterrence, it makes sense to be quite open about them.

If you are developing a weapon for the purpose of actually using it (as the US was while the war with Japan was underway) the information imperative works the other way. You don't want your foe to know what you have up your sleeve. You'll have the work go on in the middle of a desert and keep it all hush-hush until your break-out.

Under all these circumstances I can see why Israeli policy makers quite rationally regard an Iranian capability as a real threat, and why they don't regard the sort of re-assurances provided in the AlterNet piece as being especially ... reassuring.

Further, it was back in 2005, three years after IAEA says the "undisclosed nuclear related activities" began, that Mahmoud Ahmadinejad gave a chillingly explicit statement of his intentions. Not only is there, he said, a "new wave of confrontations generated in Palestine and ... growing tumult in the Islamic world" that will "in no time wipe Israel away," but even nations that merely recognize Israel will "burn in the fire of the Islamic nation's fury."

His intentions as so expressed far exceed his capacity. But his intentions are such as to make one want to keep a very close eye on his capacities.

Okay ... I've gone on for a bit now.  I've written books that were a quicker read than this post has likely been. But I have to say: none of what I've just said in any way justifies nor should it even excuse the rush to war in some quarter -- the warlike language of every Republican candidate for President not named Ron Paul, for example, [here, by way of contrast, is a link to Paul's sensible view].

So: if I want peace why have I expended such effort making these points? 

Tomorrow, sings Annie. Tomorrow.

Gary Weiss versus us Crackpots

 I admire Gary Weiss and I have indicated as much on this blog. I've even been the target of criticism because his critics think I'm a crony of his.  I'm proud to have taken a little heat for so good a reason.
Anyway, I do think Weiss has written insightfully about a wide range of issues and I have learnt a lot from his efforts.

I say all that as preface to this: Gary has unfortunately decided to stigmatize the Ron Paul campaign for president as a uniquely "crackpot" effort. I have to publicly take issue with him there. It is just about the least cracked thing happening within either of the two major parties at the national level just now. Like the US dollar among the other major currencies of our time -- the Paul campaign is the cleanest shirt in a pile of dirty laundry.

I wrote Weiss via the comment section of his blog about these views.  I'll reproduce that comment here, with minor cosmetic changes, below:

"I have to tell you Gary, Ron Paul is the only candidate (including the incumbent) who makes any sense to me these days at all.

"I won't defend everything that's appeared in his newsletters, etc. But he is bringing into the mainstream issues, like the dysfunctional nature of fiat money and central banking, and the uncounted costs of foreign adventurism, that we desperately need to have brought into said mainstream.

"As to the civil rights statutes, I agree with Paul that the use of the 'interstate commerce' clause in this sense was an almost absurd stretch of the reasonably plain meaning of the founding document. To say that the Supreme Court approved of this stretch, so it must be constitutional, is inadequate as a matter of logic. For decades the Supreme Court had approved of the notion of 'separate but equal' too. Sometimes the Supreme Court errs and its errors require resistance.

"Personally, in this case, though I object to the use of the commerce language as a blank check for Congressional power, I would be inclined to recognize a defense of necessity. The various branches of the govt of the US had to do something more to check the inertial force of our long history of racial separation and white domination than the formal declaration by the US Supreme Court in May 1954 of the end of Plessy could have accomplished. A recognition of this necessity need not and should not make us uncritical of the doctrinal particulars of such decisions as Heart of Atlanta, though. Here, too, Paul is serving a valuable purpose by his (relatively) straight thinking.

"The one change in federal policy now that could do the most for the improvement of race relations in America would be an end to the absurdities of the war on drugs. Guess who is the only candidate calling for that?"

I wrote those words prior to this Tuesday's developments in Iowa, and I ended by saying that I would be "delighted" by a Paul win there.  As indeed I would have been. In the first hour of Tuesday night's count, there was a neck-to-neck-to-neck three way tie. Only gradually did Paul fade a bit, becoming a backgrounded third to the true neck-to-neck drama of Romney versus Santorum. That is unfortunately, because it means this teaching moment, our opportunity to throw libertarian memes about in the mainstream, may already have ended.

I guess that's why they call them "moments"!

Ron Paul Got This Exactly Right

click

Two key paragraphs:

The Fed fails to grasp that an interest rate is a price—the price of time—and that attempting to manipulate that price is as destructive as any other government price control. It fails to see that the price of housing was artificially inflated through the Fed's monetary pumping during the early 2000s, and that the only way to restore soundness to the housing sector is to allow prices to return to sustainable market levels. Instead, the Fed's actions have had one aim—to keep prices elevated at bubble levels—thus ensuring that bad debt remains on the books and failing firms remain in business, albatrosses around the market's neck.

The Fed's quantitative easing programs increased the national debt by trillions of dollars. The debt is now so large that if the central bank begins to move away from its zero interest-rate policy, the rise in interest rates will result in the U.S. government having to pay hundreds of billions of dollars in additional interest on the national debt each year. Thus there is significant political pressure being placed on the Fed to keep interest rates low. The Fed has painted itself so far into a corner now that even if it wanted to raise interest rates, as a practical matter it might not be able to do so. But it will do something, we know, because the pressure to "just do something" often outweighs all other considerations.

I should add (since I used the word "exactly" in this entry's headline), that I do have one small nit to pick with the way Paul expresses himself here. Not with the substance of his exposition, which is perfect, but with the jots and tittles.

He defines interest rates briefly as "the price of time." They aren't the price of time. They are defined and measured by time, just as apartment rents are defined and measured by weeks, months, or years. But a rent isn't the price of time, it is the price of occupancy. Likewise, an interest rate is the price of credit, or of the use of the principal, for a specified period of time.

What Paul means is clear enough, and his brief use of the phrase "the price of time" probably does no harm, except ... that in the days of Savonarola and in the glare of Scholasticism one of the most common objections to the charging of interest, one of the reasons given for considering all interest as the sin of usury, was this notion that it is selling time and that time is of God. I would rather not have free-market advocates play into those bad old superstitions, or we'll end up throwing our vanities into a bonfire.

Still, Paul is making sound points. The Fed isn't wrong because of this chairman or that chairman. It isn't wrong in ways that new appointments or some tweaking of the mandating statutes could fix. It is wrong because it is a central bank, and what central banks do is in essence wrong. They are central planners, just as those who would run the auto industry from Washington (and who, these days, essentially do) are central planners.

The point should be not to improve the Fed but to close it down.

In this, perhaps, tea partiers and OWS types can come together.

Bravo, Ron Paul!

This is great. Give 'em hell Paul.

I'll say nothing further.

Home Ownership

Some thoughts toward what will become chapter 15.

The Republican Party contains within it elements that do understand what happened in 2007-08. I speak especially of those who reacted enthusiastically to Ron Paul's rather quixotic primary campaign that year. They understood what was happening as it was happening. They understood that the Federal Reserve cherapened credit in order to rescue the U.S. from the relatively mild recession of 2000-2002 and that the lending supported by that cheapening was bound to put money into the hands of people who didn't know what to do with it. That is always what such a cheapening does.

The party is what explains the hangover.

Though Paul's supporters deserve the credit for insight here, they were and remain outsiders.

The orthodox view the Republican Party seems to have developed is different, it is one that routinely overstates the role of the government sponsored entities (GSEs) in the housing boom and bust of 2007-08. Yes, the GSEs did play a role, but they were never the force driving events, and the efforts to Republicans -- those more sentral to the party hierarchy tnan Paul's small faction -- to make them seem so have come across as an ignoble quest to blame the powerless.

Came December 2010, this view had hardened into dogma, championed by Peter Wallison, a member of the Financial Crisis Inquiry Commission, the bipartisan panel that was supposed to issue a report soon explaining what did happen in 2007-08 and why. Wallison explains blows with Joe Nocera in a way that exposed his (Wallison's) own vacuity, and the continued special-pleading of his party.

Joe Nocera co-wrote, with Bethany McLean, a fine book presenting their own wel-researched take on the crisis, "All the Devils are Here." The title is a reference to Shakespeare's "The Tempest," and Nocera/McLean use it to suggest that the crisis had a lot of causes, plenty of "devils." The government sponsored enterprises (GSEs), Fannie Mae and Freddie Mac, play a role in their story, but only a supporting role. They were not leading the devilish pack, as Wallison would have preferred.

Well before Wednesday, December 15, 2010, reports were in circulation that the FCIC, under the chairmaship of Phil Angelides, a Democrat and the former state treasurer of California, harbored tensions that would make a single unified report impossible.

On that Wednesday, the Republicans on the committee, under Wallison's leadership, put out a statement of their own view of what had happened three and two years before. This was, so to speak, a dissenting opinion timed so as to precede the commission's report proper: saying "we disagree" before there was anything on the table whence to dissent.

Their view was this: "The GSE's easily met the affordable housing goals during the 1990s, but these goals were incrementally increased as part of a new housing policy agenda that began during the mid-1990s under President Bill Clinton and continued throiugh the 2000s under President George W. Bush....trying to get something for nothing -- to subsidize homeownership without increasing the budget deficit -- was a recipe for a crisis."

It was, they meant to say, the recipe for this crisis.

Nocera wrote in his column on December 17 that, as any reader of the Nocera/McLean book would have understood, he agreed that "Fannie and Freddie need fixing." In the two years and three months since the worst of the crisis they had "cost the taxpayer around $150 billion in losses, far more than, say, the American International Group."

Nocera also believed, though, that excessive focus on the GSE was a way to "tread lightly over the culpability of other nongovernmental culprits like the credit ratings agencies and Wall Street itself."

The exchange gets more intriguing....

Fannie, Freddie, Joey and Petey

A controversy involving Joe Nocera and Peter Wallison draws my attention, because it has a good deal to do with how we understand the crisis of 2007-08.

Joe Nocera is a long-time business journalist, the co-author with Bethany McLean of a newly published book, "All the Devils are Here." As the Shakespearean title suggests, McLean/Nocera's theory is that the crisis had a lot of causes, plenty of "devils." The government sponsored enterprises (GSEs), Fannie Mae and Freddie Mac, play a role in their story, but only a supporting role. They are not leading the devilish pack.

Peter Wallison is a member of the Financial Crisis Inquiry Commission, the bipartisan panel that is supposed to issue a report soon explaining what did happen in 2007-08 and why. Wallison, it is fair to say, wants to give Fannie and Freddie a larger share of the blame than Nocera does. Okay --everybody agrees the GSEs get some blame, and how much sounds like an appropriate subject for debate. So ... have at it, guys!

The problem, though, is that this is the US in the early 21st century and it is amongst us always easier to tell someone to shut up than it is to discuss substantive differences. Besides, "shut up" is so much snappier a thing to say. THAT is probably the worst of our devils. But I digress....

On December 17, Nocera wrote in his column that he had spoken to Wallison about their differences and that Wallison claimed to have seen still-secret papers. (What? not on Wikileaks yet?) here.

"Mr. Wallison said he had seen documents, not yet made public, as part of his work with the financial crisis commission that would prove that he’s right and I’m wrong. Well, we’ll see," writes Nocera.

Nocera makes his point without reference to anything secret. The GSEs, in his view, struggled to keep up with the private market operations like Ameriquest and Countrywide, fearing that they would become irrelevant, and politically vulnerable, if they didn't act in line with those practices.

Wallison has replied. He confirms here the sentiments that Nocera attributed to him about those secret documents.

"I told him this was wrong—that as part of the Commission’s work I have seen internal documents from Fannie and Freddie that show this particular mantra of the left to be a myth. For a reporter, that would have been a signal to hold his fire—a warning that there were facts out there of which he was unaware. I was telling him he should wait and see what I might write in connection with the Commission’s report. But he repeated his own dogma immediately thereafter."


This strikes me as fundamentally the wrong attitude to take. Wallison is saying that Nocera should "hold his fire" until he becomes aware of facts that will sooner or later become available. Well ... no. Every rational human being is entitled to form an opinion based on such facts as are available to that person. One should hold and express one's opinions with a consciousness of fallibility, but the idea that one should "hold one's fire" because there might yet be other facts is a demand for a lifetime of silence. It will always be the case that there might yet be more facts out there! So what?? If Nocera were writing about the causes of the outbreak of the American Revolution in 1775 it might be the case that there are still as yet unknown documents somewhere. That is not a signal to "hold one's fire." Indeed, it should be an incentive to fire away -- it may help in smoking out the new stuff.

Nocera should keep expressing the views that he forms on the basis of facts known to him, and if and when Wallison feels free to make further facts known, he should do so.

In the meantime, the rest of us are entitled to suspect that this talk about "internal documents" about which Wallison will write in the future is a tad too convenient. Felix Salmon puts it well.

So much for the ethos of debate.

On the underlying dispute, I would say (subject to being disproven by any "internal documents" that become external down the road) that the real cause of the bubble was monetary policy, not micro-economic factors, not regulatory shenanigans, and not the GSEs. Greenspan created the Housing bubble in order to get us out of the recession of 2000-02, which was caused by the busting of the previous (dotcom) bubble, which was also largely caused by monetary policy. In order to get off this merry-go-round, we need sound money.

Given all that, though, I am inclined to think that the Republicans do overstate the GSE role. It gives them a government target to shoot at, and a target that seems smaller and safer than shooting at the Federal Reserve. Ron Paul, of course, is the honorable exception. He targets the elephant.

The Iowa Caucus

Despite my feeling of philosophical detachment, I admit I retain what one might call an anthropological interest in the internal politics of the two major parties of the U.S.

Allow me, then, a few words about the caucus this week, amidst all the noise of celebration and dismay.

On the Democratic side, the results amount to less than may meet the eye. Yes, they weakened Senator Clinton, because some of her appeal had been the sense of inevitability itself. And one can't keep the cloak of inevitability around one's shoulders while coming in third. In anything.

Still, its at most a flesh wound. She still has money, organization, a famous name, and the promise of reviving an era to which many Americans already look back with fondness.

If Edwards had come in first in Iowa, I would have written the above two paragraphs just as I have. But I would have added on to them, without scare quotes, something like this: "and she's also a woman, which gives her campaign a let's make history together appeal that Edwards frankly can't match -- her sex and her insider status together making for a formidable inside/outside combo."

But Edwards didn't come in first. Barack Obama did. And he can certainly match the "let's make history together" appeal, so in the present circumstances she can't count that as one of her assets.

Still, there are only three candidates who count right now on the Democratic side. The rest are dropping away. Triangular debates might be a better show than the over-crowded ones we've so far seen.

On the Republican side, I think the rise of Mike Huckabee is an amazing story, that might make the proper chronicler -- if there's a Theodore White at his side -- ecstatic.

But we should remember that the ethanol lobby has veto power over any Republican caucus efforts in Iowa, and we should inwardly congratulate Ron Paul and John McCain. Each took a principled stand against ethanol subsidies, and each effectively punted this caucus as a result. On to New Hampshire and the rest of the country, folks!