What is Net Nuetrality?

President Obama has called on the FCC to reclassify broadband internet as a telecommunications service, possibly ending a 9 year long information service classification, and allowing the FCC to enforce a wide variety of possible Net Nuetrality rules.

So what does this mean?  I was recently asked, and having closely followed this issue for years, here is my short answer (the long answer includes a history of the telegraph, US monopoly law, telecommunications line sharing agreements, Common Accommodations rules in Historic Britain, and other topics):

Sir Tim Berners Lee created the World Wide Web, and put it best: "If I pay to connect to the Net with a given quality of service, and you pay to connect to the net with the same or higher quality of service, then you and I can communicate across the net, with that quality and quantity of service". (from wikipedia )

Common Carriers are a set of service providers which transport goods or people on behalf of the public at large, and include everyone from AT&T to Fedex to Southwest Airlines to Conrail. In exchange for being allowed to provide that sort of service to the public at large for money, they are required to not do certain things, like looking in your package, not delivering it if they dislike it, or discriminating against certain people or destinations. Fedex can't burn your package because it contains UPS advertisements, for example. They don't own the content being transported, and are generally liable if it is damaged en route.

In the US, Internet access providers were considered common carriers under Title II of the Telecommunications Act until 2005, when Comcast petitioned the FCC to reclassify them as unregulated information services. With this new freedom, Comcast and other ISPs began "traffic shaping" based on the kind of traffic or the destination - the FCC actually fined Comcast for throttling bittorrent. Though they were also caught throttling Vonage which competed with Comcast's own voice over IP product, they weren't fined for that behavior specifically.

The problem was that the FCC had already given up regulatory oversight in 2005. So a judge overturned the fine, and we've been fighting over what Net Neutrality rules should be in place ever since. ISPs would like to use traffic shaping to fit more services onto existing pipes to maximize profit in the short term without having to build out more infrastructure - however in order to do so, they want to prioritize their own traffic over that of their competition, which is a huge barrier to entry for new businesses.

In theory, Net Neutrality would prevent an ISP from throttling or blocking traffic that competed with its own products, or that it didn't like (example: Telus in Canada blocked the website of union it was in dispute negotiations with). The devil is in the details of course, and Tom Wheeler, the current chairman of the FCC, wants a Title II light: Title II/Common Carrier that allowed "managed services" - AKA throttling competing traffic. That version of Net Neutrality would be worse than nothing, codifying anti-competitive preferential treatment for ISP's products over their competitors and likely preventing new businesses from competing at all.

TL;DR: ISPs are carrying data for third parties and delivering it to you - they are acting as common carriers, they just aren't regulated like common carriers, which is historically dangerous.

Moving to Things of Interest.

Due to a lack of time, this blog hasn't gotten the attention I had wanted to give it.

So, for the time being, this will be where I post articles and documentaries of interest.

Day 1:  Prehistoric Giant Arthropods 350 million years ago!!

http://dragontonguespodcast.tumblr.com/post/81935894844/season-1-dynasties-episode-4-arthropleura

I'm Tired Too, but That's no Excuse for Intellectual Laziness

In response to an e-mail chain I was sent; I've included the original text as sent below. If you've not read the email "I'm 63 and I'm Tired" chain email, scroll down and start there.
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I will, for the most part, deal with each paragraph one at a time. The most critical part is the link at the end, so skip ahead to that if you don’t feel like reading.


I understand the frustration. But these points of frustration are not by themselves justification, as the original author clearly assumes. Working hard is a virtue, but being lucky enough to live in a society where you can reap the rewards of hard work needs to be recognized with thanks and humility. Too many times in the history of the world (including today), people worked hard their entire lives and saw nothing for it but a delayed death. Some amount of spreading the wealth is an inherent part of a stable society; when income is too consolidated at the top, a nation has a tendency to topple over. Look to the French Revolution, to the American Revolution before it, to the instability of the Great Depression. The goal needs to not be the pure adherence to the individual’s right to ownership, simply because that cannot suffice on its own – there is a reason why John Locke’s the Right to Property, included in Declaration of Colonial Rights, was not included in the Declaration of Independence. The goal must be a system which best promotes and rewards hard work and self-determination in the short-term and in the long term. Competition and division of labor in a capitalistic market system begins this process effectively, but if left unchecked, would eventually lead to a full consolidation of wealth with the minority, and to a dumbing down of the general populace; each man tasked with and taught only a single job, left unable to expand himself beyond his station. These two states are inherently incompatible with Democracy.

Adam Smith even addressed these issues in the Wealth of Nations: arguing first the dangers of division of labor without education, for the danger of competition without a progressive taxation system (at a rate not only comparable to the interest a landholder had in the estate, but at a somewhat greater amount to that interest), and finally the dangers of the consolidation of power in an elite class without governmental checks. He saw the effects of slavery and indentured servitude on society. He saw the dangers of excessive wealth consolidation and monopolistic behavior in the marketplace. He saw the ravages of the Dutch East India Company and company owners colluding to override local governments and their laws.

As an analogy, why don’t we grant people a vote proportionally weighted to their social or economic status, wherein a CEO or star gets a vote worth 100 of his employees’? We spread the power in a democracy by allowing each citizen one equally valuable vote, because some measure of social equality lends itself to a successful society. Giving people a chance to earn more voting power would consolidate that power in a select few; if we also allowed that power to then be passed down through inheritance, we would create family lineages of political power far beyond what we see today. Pure competition in the realm of power is not viable; if it were practiced by modern western societies, we would be living in a meritocracy at best, or an aristocracy at worst.

Islam is a heady topic. As a religion, it promotes both peace and violence….just like Christianity. Those who claim Christianity is just a religion of peace ignore the old testament, where rape, murder, genocide and other atrocities were considered acceptable and even holy. They ignore Christianity’s history; its violence against the pagans of the time, against Islam later, and against native peoples the world around during the colonial period. But is it fair to call Christianity a religion of violence simply because certain cultures used it as an excuse for genocide or other morally abhorrent actions? Those who see Islam as a religion of peace ignore its violence, just as those who use it to justify violence ignore its message. Tribal customs like burkas and honor killing are not Islam, they are cultural holdovers from the pre-Islamic era - just like the subjugation of women as property and honor killings like duels were common place in Christian Europe, but not features of the Christian message. Lest we forget about the violence against civilians during the crusades, the exile of entire populations from Christian European countries to lands where they neither had contacts or spoke the language. This doesn’t even address the millennia of violence within Christianity itself; the darkness of war stemming from the perversion of the Christian message for the purpose of state power; Catholic vs Protestant, Eastern Orthodox vs Rome.

These things are *why the US exists*. The collusion of religion and state power, and the taint each brings to the other. The separation of church and state, enshrined by founding fathers escaping from Europe in the constitution under “Congress shall pass no law regarding the establishment of religion” had a very specific purpose: to prevent the US’s involvement in never-ending religious war and the perversion of religion by those in political power. Western nations today are heavily based in Roman-Christian history and social custom, but our laws and government are based on Enlightenment philosophy; that the power to rule stems not from heavenly decree, on the divine right of a King and his sons to rule in the name of God, but from the collective will of the people. When that collective includes various religions, we must inherently insolate government and its public square law-making from any one of those religions or sects; just as we must insulate religion and its power from the designs of the state.

As for tolerance, I have to agree; when tolerance is required such that we must tolerate intolerance, we have taken a good thing too far. Variety is not only the spice of life and the foundation of the US, it is the solution to many problems. Monocultures fare poorly in the face of new problems; collections of customs and ideas and genes are what allow polycultures like America to thrive in the face of novel challenges. If we are intolerant to things different from ourselves, we hurt ourselves. If, however, we allow unjust violations of human rights in the name of tolerance of religion, we do ourselves an even more grievous injury. It does not appear to me that we *must* send our money to Saudi Arabia to support Wahabist schools and hate; we do so willingly though our continued reliance on non-domestic energy sources. Fixing this, and supporting secular schools in the region would go further to undermine that hate than adding our own hate on top of theirs.

Global Climate Change need not require that we lower our standard of living; it does require that we think ahead and push for sustainable food and energy production so that a lower standard of living is not thrust upon us in the most painful way possible down the line. Debate is most certainly allowed, however debate without evidence to back its counter-claims is not debate; it is shouting. I have reviewed the well-structured counter-arguments against the current models for Global Climate change, and they do not stand up in the face of evidence, just like some of the earlier models of Climate Change didn’t stand up in the face of evidence and have been discarded. Most of the arguments against climate change I have encountered, however, are not based on evidence, they are based on the theory that the world is REALLY big and humanity couldn’t possibly effect it entirely. Just as this argument was wrong when it was “The forest is massive, we couldn’t possibly cut down *all* the trees”, “The Holy River is huge, we couldn’t possibly contaminate it”, “The countryside is gigantic, we couldn’t possibly farm all of it”, “The oceans go to the *horizon* and to the depth of Poseidon’s throne, we couldn’t change it!”, it is wrong today. CO2 converts more solar radiation to heat per molecule than N2 or O2 do. As we pull sequestered carbon from underground repositories and add it to the active biosphere, we increase the percentage of the atmosphere which is CO2. Thus, temperatures will increase, and weather patterns will shift. That rate at which CO2 is being added to the atmosphere is unquestionably linked to human activity, and the rate at which surface temperature is increasing cannot be accounted for by solar activity or other natural factors. Debate at this point must reach a certain level of background knowledge before it adds to the conversation; denouncing it without knowing the current state of scientific understanding adds nothing. *That* is the style of debate being rejected.

Dealing with drug addicts is a simpler case. People have free will, they can choose to not do drugs. However, anyone who smokes knows how difficult breaking an addiction can be. We can stand on a moral high ground, refusing to help those trying to break addiction, or were can recognize that we as a society fare better when our members are not beholden to a chemical substance – that they are more productive and cost society less when their focus is on healthy non-destructive activities. This need not be a question of seeking a sense of fairness, but one of effective budgeting; we will save money *and* help more people break their addictions if we use tax money to fund treatment instead of jail time. Even if we applied this logic to only those currently illegal drugs without a physical addiction component, we would halve the number of US Citizens currently in jail and unable to get an education or a job because of that incarceration.

Finally, I find the third to last paragraph amazingly hypocritical. He finds the sense of self-entitlement and the refusal to take responsibility for one’s-self tiring (as do I); but actively denies his own benefit from society, instead taking full credit for his own success. His success, as the success of all of us, comes in part from working hard, and part from standing on the shoulders of giants. Our society, in spite of its flaws, was fundamental to our ability to succeed; if we as individuals refuse to take responsibility for the society which grants us the opportunity for autonomy, how can we fairly chastise others for not using their autonomy in the manner we prefer?

We as a nation and a world do have significant problems which need to be fixed; both ones created before us, and one we have created. But despite these problems which we must now tackle, what we have today is still monumentally better than what we had in the past (and what still exists elsewhere in the world): slavery, subjugation, widespread famine, constant war, lack of education, lack of modern medicine, lack of upward mobility through work, lack of personal religious freedom, lack of laws actively limiting government power…

Too easily we remember that time in our lives when we were not responsible for anything as a simpler time, forgetting that it only seemed simpler because we were not the ones in charge. As children, we were isolated from the horrors of injustice and war; but they were there, more often than not in a worse form than today. Objective quality of life has increased worldwide significantly over the past 200 years, and if we can manage to support individual autonomy, work ethic, ingenuity, *and* do so in a manner which is sustainable within the limits of the natural resources available, we can continue on our current trend – overall upwards, despite occasional stumbles.

A video on the objective measurements of income and life span across the world’s nations during the past 200 years:
http://www.youtube.com/watch?v=jbkSRLYSojo

____________________________________________________________________
From: XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX
Sent: Friday, January 14, 2011 9:09 AM
To: XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX
Subject: Fwd: I'm 63 years of age and I'm Tired!


63 and I'm Tired
By Robert A. Hall

I'm 63. Except for one semester in college when jobs were scarce and a six-month period when I was between jobs, but job-hunting every day, I've worked, hard, since I was 18. Despite some health challenges, I still put in 50-hour weeks, and haven't called in sick in seven or eight years. I make a good salary, but I didn't inherit my job or my income, and I worked to get where I am. Given the economy, there's no retirement in sight, and I'm tired. Very tired.

I'm tired of being told that I have to "spread the wealth" to people who don't have my work ethic. I'm tired of being told the government will take the money I earned, by force if necessary, and give it to people too lazy to earn it.

I'm tired of being told that Islam is a "Religion of Peace," when every day I can read dozens of stories of Muslim men killing their sisters, wives and daughters for their family "honor"; of Muslims rioting over some slight offense; of Muslims murdering Christian and Jews because they aren't "believers"; of Muslims burning schools for girls; of Muslims stoning teenage rape victims to death for "adultery"; of Muslims mutilating the genitals of little girls; all in the name of Allah, because the Qur'an and Shariâ law tells them to.

I'm tired of being told that out of "tolerance for other cultures" we must let Saudi Arabia use our oil money to fund mosques and mandrassa Islamic schools to preach hate in America and Canada , while no American nor Canadian group is allowed to fund a church, synagogue or religious school in Saudi Arabia to teach love and tolerance.

I'm tired of being told I must lower my living standard to fight global warming, which no one is allowed to debate.

I'm tired of being told that drug addicts have a disease, and I must help support and treat them, and pay for the damage they do. Did a giant germ rush out of a dark alley, grab them, and stuff white powder up their noses while they tried to fight it off?

I'm tired of hearing wealthy athletes, entertainers, and politicians of both parties talking about innocent mistakes, stupid mistakes, or youthful mistakes, when we all know they think their only mistake was getting caught. I'm tired of people with a sense of entitlement, rich or poor.

I'm real tired of people who don't take responsibility for their lives and actions. I'm tired of hearing them blame the government, or discrimination or big-whatever for their problems.

Yes, I'm damn tired. But I'm also glad to be 63. Because, mostly, I'm not going to have to see the world these people are making. I'm just really sorry for my grandchildren.

Robert A. Hall is a Marine Vietnam veteran who served five terms in the Massachusetts State Senate.

There is no way this will be widely publicized, unless each of us sends it on! This is your chance to make a difference. " I'm 63 and I'm tired.”
--

Roundup Resistance an Increasing Problem

"Just as the heavy use of antibiotics contributed to the rise of drug-resistant supergerms, American farmers’ near-ubiquitous use of the weedkiller Roundup has led to the rapid growth of tenacious new superweeds. "
http://www.nytimes.com/2010/05/04/business/energy-environment/04weed.html?src=me&ref=business


The larger issue here is how obvious this problem was 15 years ago, to anyone with even a passing understanding of evolution. This should be nothing more than a confirmation of the obvious - providing a selective pressure to a living population will cause that population to evolve in response.

As I have been saying now for years, both online and off, if you spray a field with herbicides, some plants will survive. Due to the randomness of application, the plant's location on the edge of the sprayed area, or a lucky rainstorm, there will be plants that do not receive the full dose of the chemical. Of those, the individual plants who better manage the toxic substance they do receive will more likely survive this reduced dosage and reproduce. Thus, you have created a second generation of plants who are all genetically prepared to better survive exposure to your herbicide.

This is not a war that can be won by brute force, and way too many people are only realizing that now.

Twelve Virtues of Rationality

http://yudkowsky.net/rational/virtues

Equal Rights Under the Law

Not the first, and likely not the last of its kind, but the story of Clay and Harold - two committed gay partners from California together for 20 years, abused by the state while Harold passed away from complications due to a fall - is simply put, horrible.

The couple, 88 and 77, suffered without need after Harold took a fall and was hospitalized. Clay was not allowed to see him in the hospital as he was not 'family' - and then things got bad. The County went to court to take control of Harold's finances in order to pay for medical care and a nursing home, acting as if Clay was not involved. The house they shared was effectively confiscated from them and returned to the landlord, and many of the possessions sold at auction. Clay was forcibly moved to a different nursing home than Harold, and then Harold passed away.

Not only are there some serious property rights questions involved here, two clearly loving partners were kept apart by society during the last days they could have spent together. That is absolutely unconscionable.
http://www.nclrights.org/site/PageServer?pagename=issue_caseDocket_Greene_v_County_of_Sonoma_et_al

President Obama's recent call for improved medical rights for gay couples is a step in the right direction ( http://www.nytimes.com/2010/04/16/us/politics/16webhosp.html) but it still doesn't allow committed homosexual partners to be considered "family" - and that too is unconscionable.

The disconnect between science and the public

The disconnect between someone in a given professional field, familiar with the topics of discussion around the water cooler, and those who are on the outside, are fairly universal.

Electricians know about electrical wiring protocols, I do not.

Car mechanics know about engine hose manufacturer types, I do not.

However, the overarching field of science effects the quality of life of a very large section of western society; from medicine to computers, science helps us to both build tools, and how best to apply those tools.

Thus, the suppression of scientific data when it goes against a pre-determined political or social mindset, effects everyone one of us, inside or outside the profession.

It is therefore worry some that the normal divide between scientist and non-scientist extends to the stories about political pressure placed on scientists during the Bush Administrations 8-year tenure. Threats of firing, edited reports, and more, are both alleged and admitted to have occurred; and yet only a fraction of the general public is even aware of it!
http://people-press.org/report/?pageid=1549

Patience

Lots of action going on in the government at the moment. Lots of projects, lots of experiments. I'm not educated enough on the items at hand to really have a serious opinion about the details of these plans, so I won't jump at a guess.

Doing nothing will likely result in the markets correcting themselves, likely at a great cost to many who had nothing to do with this situation. Possibly, if things were actually as bad as some thought 6 months ago, at the cost of the modern economy itself. Some form of Keynesian government spending seems to be a good idea - investment which will pay for itself down the line is 100% a good idea.

However, many people, Germany in particular, are very concerned about hyper inflation from the Fed printing money to pay for this work; and given Germany's experience between the world wars, they have every right to be concerned. They know the dangers of trying to simply print your way out of debt.

The US Dollar may be entrenched enough to survive a massive increase in available notes through sheer inertia, but if too much money is printed, the US dollar can plummet in value just like any other currency.

So, while I still support demand-side stimulus, I am going to be patient to see how this all plays out. Hopefully, there will be caution along with the action.

Obama Begins the Process of Fixing Gov't Accounting

At the cost of looking like he is increasing the deficit by an additional $70 million dollars, President Obama has banned certain accounting tricks, started by the Carter Administration but brought to an art form during the last Bush presidency. In particular, the AMT is going to see an overhaul, bringing its account in line with its reality.

This is a great step forward in fixing our overall economic crisis: properly recognizing our debts.
http://www.nytimes.com/2009/02/20/us/politics/20budget.html?_r=2&partner=rss&emc=rss

Congressional Budget Office sees Overall Growth due to Stimulus

From the Feb 11 Congressional Budget Office, an independent group the oversees gov't actions and proposals:

"Taking all of the short- and long-run effects into account, CBO estimates that the
legislation implies an increase in GDP relative to the agency’s baseline forecast of
between 1.4 percent and 3.8 percent by the fourth quarter of 2009, between 1.1 percent and 3.3 percent by the fourth quarter of 2010, between 0.4 percent and 1.3 percent by the fourth quarter of 2011, and declining amounts in later years (see Table 1). Beyond 2014, the legislation is estimated to reduce GDP by between zero and 0.2 percent....

Correspondingly, the legislation would increase employment by 0.8 million to 2.3
million by the fourth quarter of 2009, by 1.2 million to 3.6 million by the fourth quarter of 2010, by 0.6 million to 1.9 million by the fourth quarter of 2011, and by declining numbers in later years. The effect on employment is never estimated to be negative, despite lower GDP in later years, because CBO expects that the U.S. labor market will be at nearly full employment in the long run. The reduction in GDP is therefore estimated to be reflected in lower wages rather than lower employment, as workers will be less productive because the capital stock is smaller."
http://www.cbo.gov/ftpdocs/99xx/doc9987/Gregg_Year-by-Year_Stimulus.pdf

The last sentence of each paragraph is critical, and is what is being taken out of context all over the place. In both cases, the CBO is saying that in the long-term, the effects of the stimulus will taper off to eventually be effectively unnoticeable; that in the long-run, the economy will recover from this downturn on its own.

Assuming that we are not actually facing the leading edge of a complete failure of western society right now, that should be a given.

The GDP numbers do suggest that in the mid-term, we may actually see a 0.0 to 0.2 percent decrease in annual GDP (which, according to other sources, would even out by 2019), but they are *not* saying that the stimulus will "cause a reduction in our economy" as a whole, despite what some senators and journalists are currently claiming.

In the end, the report suggests that in exchange for a combined 2.9 - 8.4% GDP increase over the baseline forecast for the next 3 years along with increased employment in the millions, we may see a <1% decrease in total GDP spread over the years between 2014 and 2019.

Attendence to Religious Service, not deviotion to faith, predicts suicide bombing

Adding more evidence to the idea that regular organized religious attendance - at a church, synagogue, mosque or temple - is as much about social unity than anything else, a three-pronged study shows a strong correlation between suicide bombing and attendance to religious services; no correlation found between suicide bombing and religious devotion, as measured by daily (personal) prayer.

http://scienceblogs.com/notrocketscience/2009/02/attendance_at_religious_services_but_not_religious_devotion.php

The Mother of all Bailouts?

Start with this post sent to me via the Populist America newsletter:
http://www.populistamerica.com/the_mother_of_all_bailouts

My response to the author can be found in the comments; I've reproduced it here. His questions are in bold, my responses are in normal font.
-----------------------------------------------------------------------------------

As mentioned above, if not having enough dollars is the problem, why not have the government give each person a million bucks? Would that fix everything?

No, because by simply increasing the number of dollars, you decrease the inherent value of each individual dollar. The dollar is not wealth, it is a tool for moving wealth. *Work* creates new wealth.

If increasing spending fixes an economy, how about if we all stand in a long line, and everyone hand $20 to the person next to them? How about $1,000? Would that fix everything? (Or, if gifts aren’t good enough, everyone could buy his neighbor’s shoes for $1,000. Wouldn’t all that “spending” save the day?)

This is a misleading question. The economy *is* spending, by definition; but more importantly, it is spending on new effort that creates. By simply trading money for no work, we gain nothing – again, the dollar is a tool for trading, not wealth itself. If we all give each other $20, we waste everyone’s time. If we all make *new* shoes, and *then* pass around $20 in exchange for them, we have an economy.

If it helps the economy to redistribute wealth, how about if the government takes away all existing wealth and divides it up equally, 300,000,000 ways? Would that fix everything?

Also a misleading question. Redistributing wealth is not inherently beneficial to a society, especially when that redistribution is not in line with individual effort. However, reducing the overall income gap *is* beneficial to society. The more top-heavy a society gets, with the upper-upper class holding more and more of the money, the more unstable it gets.

A healthy middle class is a healthy and stable nation, a large economy, and an improved quality of life for the nation as a whole. A weak or non-existent middle class results in a smaller economy, a lowered quality of life for the nation as a whole, and subsequently results in an unstable nation.

Effectively, what it comes down to is this: Money in circulation for trade of goods and services is a stabilizing force for society. Money held out of circulation is a destabilizing force, as is is not doing any work other than to foment jealousy.

If the problem is lack of jobs, how about if the government gives a job to anyone who wants one, paying them $50 an hour to carry empty boxes around in circles? Would that fix everything?

Again, this is misleading; suggesting that the only solutions being put forward are communist. Money is not wealth. If we want to pay people to do work, there is lots of *actual* work that needs to be done. There is no reason to start paying for box-carrying when we have infrastructure, medicine, farming, research, etc that needs doing.

If a lack of credit is the problem, how about if the government gives everyone a new, federal credit card with a $1,000,000 line of credit? Would that fix everything?

No. We have too much debt in general; and we’re going to have a rough time over the next few months as we reduce the debt in circulation to come closer to a safe ratio to the actual money in existence. I’m not much of a fan of 1:11 lending; 1:33 lending was insane, and we’re paying the price for it.

If “corporate greed” is the problem, how about if government outlaws making profits, forcing companies to sell things at prices that would just make them break even? Would that fix everything?

This is a specious argument; there is a vast gap between “lax regulation” and “outlaw all business”. Smart regulation is a necessary part of any market; or do you think that monopoly laws should be eliminated? What about workplace safety regulations? Food quality control?

CRA not the cause of Subprime meltdown.

"As Barry Ritholtz notes in this fine rant, the CRA didn't force mortgage companies to offer loans for no money down, or to throw underwriting standards out the window, or to encourage mortgage brokers to aggressively seek out new markets. Nor did the CRA force the credit-rating agencies to slap high-grade ratings on packages of subprime debt."
http://www.slate.com/id/2201641

The CRA, Community Reorganization Act, helped create the less-so but still-profitable subprime lending market to minorities in 1977. It remained stable for nearly 20 years. In 1995, Clinton altered the act to allow for slightly riskier loans – Bear Sterns (note, not covered by CRA regulations anyway) lead the way in using this law change to aggressively enter this market. From 1997 to 2002, the subprime rate rose to and stabilized at about 10% of the overall market. In 2000 Phil Gramm, one of the John McCain’s chief economic advisers wrote the Securities Modernization Act, which introduced Default Credit Swaps – insurance on loans that wasn’t called insurance so that it wouldn’t be regulated, and responsible for trillions of dollars of the current problem. In 2002, Clinton’s changes were up for review, but Bush did not review them. From what I can find, he didn’t act on the review period at all.

In 2003, Bush noted that Fannie and Freddie’s subprime loans were getting to be too large of their overall holdings, and tried to get oversight of the two entities moved from congress to the Treasury Department. This action failed, no doubt because handing over more power to the Executive branch in 2003 was not likely to happen. This action did not do anything about the public mortgage marketplace, just the FM’s.

In 2005 the Bush administration, via the Office of Comptroller of Currency enforced for the first time, a 1860’s law which allows federal oversight of banks to supersede state-level regulation. All 50 state AG’s and all 50 state Banking Commissioners objected to this action, which prevented state-level regulations from being enforced. Also, the CRA was amended to only apply as it had previously to banks with assets >$1B, instead of all banks with assets greater than $250M as it had previously, and allowed mortgage banks to leverage themselves beyond the 10% threshold that had previously been in place (Lehman Bros was at 33/1 when it fell over). At this point, subprime lending increased from ~10% of the mortgage market to ~25% as of the beginning of this year.

More than half of subprime mortgages were made by institutions either not covered by the CRA (independent mortgage brokers) or only partially covered (bank subsidiaries), and 40% of all home purchases in 2006 were not primary residences – a record number.

Large Majority of Economists Support Obama's Economic Plan

In a follow-up to the previous post, The Economist reports significant favor for Obama's plan among respondents to a poll of economists nationwide.

This graph says it all:

From The Economist:
"Examining America's Presidential Candidates
http://www.economist.com/world/unitedstates/displaystory.cfm?story_id=12342127

Economists Favor Obama

Right-leaning Libertarian cartoonist Scott Adams, creator of the tech-office strip Dilbert, has commissioned a survey of economists to determine which candidate the classic super-geeks favored with regard to long-term economic benefits and other social issues.

Obama came out on top in nearly every category, and even though the sample was heavily democratic, that's only because apparently, most economists are democrats, nationwide.

That last bit's news to me, too.

http://www.cnn.com/2008/POLITICS/09/16/dilbert.economy/index.html

BPA (chemical in many plastics) Slows Brain

http://www.treehugger.com/files/2008/09/bpa-makes-you-stupid.php

"It dramatically impairs the formation of synapses in the regions of the brain important to learning," biomedical science professor Neil MacLusky [of the University of Guelph] said.

Nalgene, maker of super-tough water bottles for recreational use, recently began selling BPA-free bottles, I recommend them.
http://www.nalgenechoice.com/

Obama to make VP part of the Government again

Obama has promised to make his VP part of the executive branch of the government - not an undefined fourth branch, as created by VP Cheney in avoiding punishment for his questionable if not outright illegal activities. A VP that's part of the Executive branch - as the office had previously been since the 1700's.

It's sad that I'm excited by the idea of a president that actually wants to follow the constitution, but that's where we stand.

*sigh*


http://www.thetimes.co.za/News/Article.aspx?id=826159

The state of cheap laptops

The idea was this: provide for poor schools all the books they didn't have. Math, History, Language.

But it was not an easy task. How do you get hundreds of text books, weighing thousands of pounds, to the far reaches of the world? And what did you do when the information in them became outdated?

The concept was to give, instead of 5 pound books, one 3 pound laptop - low powered (with hand-crank and solar options so that it would even work in areas with no electric grid), rugged (water resistant and sand resistant), with a connection to the internet (and it's thousands, no, thanks to Google, millions of books) - and sell it for $100.

The idea from one Nicholas Negroponte from MIT was ground breaking. And with a cadre of volunteers, he delivered. Using a low-powered AMD Geode processor, a free Linux-based Operating System, and a fantastic screen that worked out in the sunlight, the OLPC (One Laptop Per Child) XO laptop was born.

Right out of the gate it sold fast, to schools in South America and Africa. Unfortunately, as orders for the XO computer started pouring in, businesses suddenly realized that Negroponte was right - there was a large untapped worldwide market for low-cost computers. And that was the projects undoing.
http://technology.timesonline.co.uk/tol/news/tech_and_web/article4472654.ece

Today, there are a number of entrants into the low-end laptop market. While Intel's post-OLPC project, the Classmate PC, was gobbling up marketshare around the world thanks to the slightly stronger hardware and the great power of Intel's marketing arm, Asus's Eee PC came out of the gates like a bull - their small, standard component laptop sold for $300 to anyone who wanted it (OLPC and Intel were selling only to schools), and the public ate them up.
http://www.pcconnection.com/IPA/Shop/Product/Search.htm?term=asus%20eee&DefSort=Y&searchFilter=ALL

Acer has also entered the low-cost laptop recently, relying on Intel's Atom low-powered processor.
http://arstechnica.com/reviews/hardware/atom-nano-review.ars

The result is a good competitor to the EeePC, with a bit more power for just a bit more money:
http://www.pcconnection.com/IPA/Shop/Product/Detail.htm?sku=8708409

OLPC is most likely dead, though the technology may live in in other projects; Mr Negroponte's idea certainly changed the landscape of low-cost computing. Sadly for the school children of the world, the lowest-cost computing system - also the one built with harsher environments in mind - will not be a part.

The Year of Living Biblically

What happens when an agnostic follows all the rules of the Bible for one year? He finds that belief isn't a requirement for sacredness to be useful.

http://www.ted.com/index.php/talks/a_j_jacobs_year_of_living_biblically.html

Lifestyle may effect genes, too

No, we're not talking about a return to the Lamarkian theory of evolution. By exercising, reducing stress, and changing diet, a number of men with prostate cancer have seen drastic changes in gene activation - most notably in genes that are involved in cancerous growth.

A larger study needs to be undertaken to eliminate the effects of chance on the results, but it is a very promising result! Eat your carrots, kids!

http://www.msnbc.msn.com/id/25201082