April 14, 2010

The Age of Obama

For someone whose boyhood was punctuated by the latest marvel of space travel from Sputnik on, this is pretty poignant. The signatories' names have almost mythical weight:
"America’s only path to low Earth orbit and the International Space Station will now be subject to an agreement with Russia to purchase space on their Soyuz (at a price of over 50 million dollars per seat with significant increases expected in the near future) until we have the capacity to provide transportation for ourselves. The availability of a commercial transport to orbit as envisioned in the President’s proposal cannot be predicted with any certainty, but is likely to take substantially longer and be more expensive than we would hope.

"It appears that we will have wasted our current ten plus billion dollar investment in Constellation and, equally importantly, we will have lost the many years required to recreate the equivalent of what we will have discarded.

For The United States, the leading space faring nation for nearly half a century, to be without carriage to low Earth orbit and with no human exploration capability to go beyond Earth orbit for an indeterminate time into the future, destines our nation to become one of second or even third rate stature. While the President's plan envisages humans traveling away from Earth and perhaps toward Mars at some time in the future, the lack of developed rockets and spacecraft will assure that ability will not be available for many years.

Without the skill and experience that actual spacecraft operation provides, the USA is far too likely to be on a long downhill slide to mediocrity. America must decide if it wishes to remain a leader in space. If it does, we should institute a program which will give us the very best chance of achieving that goal.

Neil Armstrong

Commander, Apollo 11

James Lovell

Commander, Apollo 13

Eugene Cernan

Commander, Apollo 17

New New Jersey

I pay property taxes in New Jersey and my youngest children go to public school there. The school's very decent and I'm on good terms with a lovely Ghanaian-American teacher who did a fine job with one of my girls. She's liked me since I read Rikki Tikki Tavi with relish to her class in my weird English accent and I was glad to set up a website for her. She's a major Obama supporter, but I keep my nose clean on that score. The admirable head teacher is discreetly homosexual, so, what with Obama pix in classes, pc prohibitions on Christmas, unionization, overly protective rules against letting children outside in cold weather and so on, there's plenty of scope for societal collapse. In fact the school does a good job overall.

Recently my wife was sent a petition against school staffing cuts by a parent who had voted for Chris Christie. That's the power of socialist propaganda. Governor Christie will need to do a terrific job of communication to overcome this most fearsome special interest - the teachers' union. I was struck by this comment in Powerline:
if he somehow faces down the teachers' union, he may have a Calvin Coolidge kind of sequel in store.
Coolidge was perhaps the best president in the twentieth century and made his name by facing down the Boston police union when Governor of Massachusetts. Here's Christie at work:

If I were stiffing a creditor for trillions, I'd bow too

Here's how it looks from China:
Krugman accused China of "engaging in massive capital export - artificially creating a huge deficit in China's capital account". China is running a current account surplus with the US, which by definition means that China is exporting capital to the US. In my view, the most important reason why China should not run a current account surplus consistently against the US is simply because China is one of the poorest countries in the world, and should not engaging in financing the consumption binge of the richest country in the world.
China is running "twin surpluses" - current and capital account surpluses. It means that while importing capital in the form of FDI and foreign debts with high costs, it exports capital in the form of piling up greenbacks and US treasuries with low yields or no yields at all. By doing so, China has been engaging in a massive wealth transfer to the US. How could Krugman argue that China is "making everyone else poorer"?
The losses incurred in financial transactions between China and the US could be trivial compared with the capital losses China may suffer in the future. China has parked its savings in the US treasures while US fiscal debt ratio has been surging. Following the upcoming structural changes such as aging, China will run down its foreign exchange reserves sooner or later. A very big question for China is: When it needs to redeem its treasuries, can America honor its debt obligations?
History may show that China is the biggest victim of the post-Bretton Woods international monetary system, a system of the dollar standard. Under this system, everything hinges on the integrity of the American government and the Fed, or the speed of their printing press. The American government and the Fed have let down those who have trust in them.
For its own sake, China should stop further piling up greenbacks massively.
Yu Yongding, president of the China Society for World Economics.

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