After Umar Farouk Abdulmutallab failed to blow up Northwest Airlines Flight 253 on Christmas Day, the Transportation Security Administration issued a directive requiring airlines to immediately make major changes in their operations.
Whether TSA's actions were legal (or should have been illegal) is an interesting question. What is more immediately interesting is that the directive itself implies a higher concern about the appearance of safety than safety itself. Nothing in the directive would have prevented Abdulmutallab from bombing Flight 253 or prevent a similarly equipped terrorist from blowing up an airliner tomorrow.
Last week, unknown hackers broke into the computer at the University of East Anglia's (UK) Climate Research Unit, downloaded a trove of emails and other documents, then posted them on the web for all to see.
The Associated Press reports from Afghanistan on how the UN-backed Electoral Complaints Commission will adjust vote totals to account for fraud, which now appears to have been widespread in the August 20, 2009, presidential election. The EEC is sampling ballots to determine the number and rate of fraudulent votes for each candidate. It appears that it has chosen an adjustment method that rewards fraud.
On July
8 we
blogged on a commentary published in the Wall Street Journal under the
joint bylines of UK Prime Minister Gordon Brown and French President
Nicolas Sarkozy. The two European leaders alleged
that speculation had damaged the world crude oil market by
making
it "dangerously volatile." We surmised that the sudden interest in oil
market speculation, which seemed to have come out of the blue, was
instead highly coordinated. There is now more evidence supporting that
hypothesis, but some indication that it is encountering resistance. More...
Earlier this week, UK Prime Minister Gordon Brown and French President Nicolas Sarkozy proposed the establishment of a global regulatory regime to "stabilize" oil prices. We deconstructed the proposal to show that the Brown-Sarkozy proposal seemed to be aimed at keeping oil prices high, not necessarily stabilizing them:
The potential scope and scale of this proposed "government supervision" appear to be quite large. Brown and Sarkozy are seeking a global regulatory regime that would "reduce damaging speculation" and "serve the interests of orderly and adequate investment in future supplies." The commentary provides no insight concerning what social benefits are obtained by "orderliness," or how much speculation is "damaging." Indeed, Brown and Sarkozy follow a well worn path by criticizing "speculators" for driving prices up (or, in this case, down). Every futures contract has both a willing buyer and a willing seller.
Futures markets serve an important public purpose--they provide price discovery--and, ironically for Brown and Sarkozy's argument, they tend to reduce price volatility. Regulatory restrictions on speculation should be expected to increase uncertainty, and thus exacerbate volatility. But as an analysis of the Brown-Sarkozy commentary shows, price volatility is not the problem they are actually worried about. They are trying to figure out how to use regulation to keep prices high and make it seem as if this is a good thing for consumers.
Early reactions to the proposal suggest it has a long way to go to be persuasive.
The summer G8 meeting is over, and the press is reporting that leaders were unable to reach agreement on climate change. For example:
Reuters: "G8 leaders failed to persuade India and China to join a push to cut greenhouse emissions by 50 percent by 2050," and "a G8 deal to reduce its greenhouse gas emission by 80 percent by 2050 was thrown into doubt within hours of being announced."
Wall Street Journal: "The world's richest and its largest developing economies made a little progress in bridging the gaps that divide them Thursday, agreeing on the ultimate goal for climate change negotiations, and a relaunch of stop-start trade talks that have dragged on for eight years."
New York Times: "The world’s biggest developing nations, led by China and India, refused Wednesday to commit to specific goals for slashing heat-trapping gases by 2050, undercutting the drive to build a global consensus by the end of this year to reverse the threat of climate change."
However, the G8 leaders were able to reach an agreement that scientists are in charge of climate change policy-making and that the benefits of mitigation far outweigh the costs.
In the last day or so there has appeared in the news a sudden interest in regulating the global market for crude oil. This is almost certainly the unveiling of a coordinated plan.
Debates about universal health care inevitably lead to comparisons, such as with Canada and the United Kingdom in large part because there are no language barriers making the experiences of other nations hard to gather and analyze. Typical observations from these systems include the various non-price means by which health care is rationed. For example, care can be rationed by forcing patients to wait. Some will decide that waiting is too burdensome and choose not to seek care. Some will seek health care outside of the system; Canadians can obtain care in the United States rather than wait, as long as they are willing and able to pay for it. Inevitably,some patients will die before they can receive care, and these patients will tend to be poorer than average.
The UK also rations care by authorizing a government agency (the National Institute for Health and Clinical Excellence, or NICE) to make eligibility decisions -- that is, they will decide by rule, formula, or other criteria who is eligible to receive expensive services and who will not. For example, on June 24, 2009, NICE published guidance concerning percutaneous endoscopic laser cervical discectomy, a less invasive technique for remedying certain spinal problems. The NICE guidance generally restricts access, which is available in the United States as an outpatient procedure and for which there are published peer reviewed reports of success.
Recently published peer reviewed research offers very interesting insights about how universal health care has performed in Japan. This study is interesting because Japan has succeeded in providing universal coverage and it has limited health care expenditures to about half of the GDP fraction of the US. How did Japan accomplish this?
On June 11 the World Health Organization decreed that the recent outbreak of (A)H1N1 influenza ("swine flue") qualified as a "pandemic." According to reporters for the Washington Post, WHO delayed making this decision long after it technically met its established definition. The reason for delay is that policy officials no longer liked the definition and were concerned that a declaration of a pandemic could lead to panic.
In today's New York Times, Elisabeth Rosenthal says that Irish consumers don't use plastic shopping bags anymore. She acknowledges that the government has imposed a new tax of 33 cents per bag, but she appears to be baffled that consumers respond to taxes. Instead, she searches for mystical explanations. More...
The web is chock full of commentary on the recently released summary of the National Intelligence Estimate on Iran. (We emphasize summary because the body of the NIE remains classified.) We've posted here and here on the NIE as a risk assessment document, noting that it claims to be an objective assessment not confounded by risk management (i.e., policy or political) concerns.
We've read much (but by no means all) of this news and commnetary and drawn some inferences we hope are useful. More...
Early today we posted the unclassified summary of the recent National Intelligence Estimate on Iran's nuclear intentions and capabilities. We said that while we could not comment on its substance -- the details leading to the published judgments remain classified -- the document itself appeared to be notable for its transparency of language, recognition of uncertainty, and the clarity with which it defined the probabilistic language used to describe both the substantive judgments reported and analysts' confidence in them.
Today's news reporting on the NIE shows why it is so important that risk assessments be performed in an objective manner: risk managers, other political actors, and the press often want risk assessments to support predefined narratives and policy views. In less than a day, many of them have stripped away the NIE's careful calibration of uncertainty, suggested that its judgments are colored by the expectation that it would be made public, and undermined the case for performing risk assessment by using it for partisan political purposes. More...
An unusual example of risk assessment appeared today in the news: the disclosure of an unclassified summary of the November National Intelligence Estimate (NIE) concerning Iran's nuclear weapons program. The document, which for obvious reasons is not transparent and reproducible, nevertheless is remarkably clear about the uncertainties which underlie its estimates. More...
