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Warning to Readers: I’m venturing into territory where (a) I know even less than usual and (b) I haven’t been at all diligent in reading the public record or commentary, so feel free to skip this!

With Facebook trading at around 34 or 35 compared to the IPO price of 38, It strikes me that Facebook has managed its IPO masterfully to get the most money for the inside sellers of the stock, and the least for the Wall Street managers and greedy/fanboy first day buyers. This management included a wall street rumor on the day before the IPO that based on the roadshow the managers would have liked to raise the offering price to 41 or 42 but were precluded from doing so by the terms of the initial solicitation. As it was they were able to increase the number of shares issued at 38. I have no clue whether this rumor was honest or intentional market manipulation, but judging by the outcome it was certainly a good thing for the Facebook insiders who were selling in the IPO.  Whether in the long run it will be good for future companies raising funds through IPOs is another question.

On the other hand, Zuckerberg’s surprise (to the guests —  presumably not to the bride) wedding following his girlfriend’s graduation from medical school was clearly a class act.

Romney and Gender at Liberty University — Sometimes it’s what’s not said that’s emblematic

Excluding various references to God, and two where his wife Ann served as a prop to introduce the actions of a man, Romney mentioned 19 people in his speech — all male. He claimed christianity builds “heroic souls” — but, you guessed it, he couldn’t imagine that any women’s souls were the equal of watergate conspirator Chuck Colson’s, nor were any women scholars worth citing along with David Landes or Viktor Frankl (!). Ironically, the one reference to women in his speech appears to be a direct quotation of materials produced by Liberty University.

Perhaps the Cranbook ethos lives on in Romney today.


Several Reflections on the Death of Bin Laden

We should be cautious on drawing too many conclusions from publicly available information, especially given the inaccuracy of early accounts (woman as human shield, etc.), but several features of the story beyond what’s been commented on widely are interesting:

1. Bin Laden may have been an operational drag on “Central Al Qaeda.” The weird story about plots to disrupt American trains (!) on the tenth anniversary of 9/11 suggests that Bin Laden was still actively involved in operational planning. He could only communicate infrequently and with low bandwidth, vastly increasing the cycle time of planning revisions. It also put him very out of touch, probably contributing to Al Qaeda central irrelevance. I suspect that, despite the symbolic value of eliminating Bin Laden, had he just been eliminated by an airstrike, it might have been a net plus for Al Qaeda.

2. The operation as conducted, on the other hand, because of the intelligence yield of hardrives and documents and thumb drives now in US possession, leaves every Al Qaeda associate wondering whether their location has been or is about to be discovered, and whether they will soon meet a similar fate. They will no longer trust established communication channels and will suspect that people in contact with them have flipped. Al Qaeda’s central coordinating and resourcing function, had it had any strength left, probably is no more. The lesson will not be lost on people thinking of joining similar networks.

3. The controversy over the photos revealed interesting dynamics in the Obama administration and much silliness elsewhere. Leon Panetta said the photos would be released – despite this the President decided the opposite. It is clear who is in charge of this administration. On the other hand, Senator Lindsey Graham’s statement that the photos should be released because the only reason the go in on the ground was to obtain proof of Bin Laden’s death was utter foolishness. First of all, the intelligence yield and disruption of Al Qaeda was even more important than certainty (See #2 above.). Second, certainty was established in other ways than a picture. Third, a picture can be doctored and would not convince those who ready to believe in conspiracies (viz the parallel with Obama’s birthplace).

4. It’s interesting that in reaction to belief that elements in the Pakistani Army or ISI protected Bin Laden people are talking about cutting economic assistance funds, that tend to support the welfare of the Pakistani people and the civilian government, but not the assistance through military channels and the Pakistan Counterinsurgency Contingency Fund, that are targeted directly on producing a Pakistani military more aligned with U.S. regional goals.

Fail-Safe Reprogramming for Toyotas

Why not solve the Toyota accelerator problem — at least on an interim basis — by reprogramming their engine computers to idle the engine when the brake is depressed for more than an instant?

From press reports it appears that Toyota has known since 2007 that it has a low-incidence problem with full-on acceleration, presumably caused by sticky accelerators but not conclusively linked to a single mechanical cause.

I have no experience with Toyota engine computers, but if they are like European ones they receive input from the brake pedal switch as well as accelerator position via the  throttle position sensor and engine RPMs via the crankshaft sensor.    The software is contained in flash memory that can be reprogrammed by the dealer.

Thus the problem can be dealt with positively — no matter what the cause — by reprogramming the computer to override the throttle input and shut off gasoline to the injectors (or limit it to idle levels) when the brake pedal is depressed  for more than an instant.   Even if there is a bug somewhere else in the software this override can be accomplished in a way that has priority over other instructions.  This might impair drivability under some race car scenarios but would be much superior to the current state of fear that is being imposed on Toyota drivers.

At the same time,  software diagnostics should be added to track discrepancies between throttle position and engine RPMs, to ensure that the cause of the problem is indeed mechanical at the accelerator pedal (or a driver-induced problem) rather than a fault in the computer or other engine component.

This solution seems so obvious that there must be something I am missing!

Updating Various CIA Controversies

Richard Clarke made sense in Saturday’s WSJ in an extended piece that went behind three current surface controversies involving the CIA. Clarke endorses a “truth commission” as a step toward creating a political space for a more sophisticated discussion of what we expect from intelligence in a democratic society.

On Saturday The Wall Street Journal carried a long and thoughtful piece by Bush/Clinton/Bush NSC counter-terrorism chief Richard Clarke that analyzed three recent stories about the role of the CIA. Clarke’s underlying point is that the three stories are animated by deep tensions in the role of intelligence in a democratic society, but the way they are being addressed is dysfunctional because the surface symptoms rather than the underlying substantive issues are the focus of controversy.

So on whether the CIA has misled the Congress, he says that oversight has been dysfunctional for 30 years, and needs to be reconstructed. Democrats in Congress have a proposal to do so, which the Administration has threatened to veto. Hardly anyone is assessing whether it is in fact a good proposal.

The issue of possible CIA hit squads, he suggests, is much more about the CIA’s inability over ten years to develop a meaningful covert capability against Al Qaeda’s top leadership–it’s competence, even more than oversight, that needs attention.

On the issue of whether AG Holder might appoint a special prosecutor to examine interrogations that went beyond techniques authorized by the Bush administration, Clarke notices a somewhat hysterical reaction on the part of the CIA’s public friends to what is after all not a change in Administration policy. The issue of interrogations within what was authorized is the more fraught issue, given that the Nuremberg defense is invalid and the further likelihood that the authorization was in violation of international and US law and perhaps fraudulently obtained.

Clarke sees a truth commission of the sort Senator Leahy has advocated as the best path to sorting through these underlying issues of what we want the CIA to do and how to improve its governance and effectiveness.

I don’t agree with Clarke on every point — for example there is much more to “covert action” than “lethal action,” and it’s not only the lethal action that’s problematic (use of covert funds and dirty tricks to influence election results in other countries was another problematic activity over the years). As a result leaving lethal action to the military wouldn’t solve the oversight problem. Moreover, there are clandestine elements to intelligence collection, creating important common elements between collection and covert action–suggesting that it would not make sense to just separate the two.

For another perspective on covert action that also suggests a bias against it, see Greg Treverton’s recent book, Intelligence for an Age of Terror. At places Treverton needs to be read closely — for example he does not really intend the facile contrast between Cold War intelligence as being properly about “puzzles” and 21st century intelligence being about “mysteries.”

Clarke’s article is worth attending to because it’s so much more useful than much commentary elsewhere — like David Ignatius’s article in the Post last week, which managed to suggest that politicians by raising questions about the veracity of the CIA are impairing morale and capability– thus tending to prevent any oversight and force for improvement of the CIA. In this line of argument, the CIA is so fragile that it cannot bear any sunshine. Or Marc Thiessen’s defamatory assertion that the leaking of the nature of the assassination program shows that Congress cannot keep a secret — when it is equally possible that the CIA itself was the source of the leak, even perhaps to discredit the Congress.

Too many in Congress are using the 9/11 Commission recommendations and the role of the Director of National Intelligence and his office as the litmus tests of Intelligence reform, rather than focusing on the determinants of real intelligence capability and effectiveness.

Meanwhile, evidence continues to accumulate about the fecklessness (at best) of CIA management of interrogations and a lack of scrupulous regard for the truth in its dealing with other branches of the government.

In the most detailed discussion yet of the CIA’s supervision of the torture of Abu Zubaidah, the Washington Post explains that the CIA contractors who designed its enhanced methods were ultimately at odds with CIA HQs because they thought Zubaidah had broken but HQs (probably under the influence of Cheney and Bush) still insisted on further waterboarding. The torture only stopped when the contractors threatened to quit and insisted that HQs personnel travel to Thailand to see it for themselves. The implication of the Post’s account is that it was the brutality of waterboarding, not the question of whether Zubaidah was cooperating, that convinced CIA counter-terror officials to stop the practice.

The Post reports that Royce Lamberth, the extremely activist but not partisan Federal Judge who is the chief of the DC District Bench and who was on the FISA court when it was informed of the Bush administration’s illegal wiretapping, has ruled that five CIA officials including George Tenet perpetrated a fraud on his court.

Update David Ignatius plays catch-up in today’s (July 23) Washington Post, recognizing the question of why the CIA has programs that start and stop and start again over eight years with no results.

Now that the “Genocide” Shoe is on the other foot …

Turkish PM Erdogan has condemned as genocide the recent events in Xinjiang, which is more than mildly ironic given the Turkish allergy to any discussion of the Armenian genocide during Ottoman times.

Reportedly, Turkish PM Erdogan has labelled as genocide the recent events in Xinjiang, and the Chinese he demanded he take back his words.

This is mildly amusing given how Turkey reacts to discussions of the Armenian genocide by the Ottoman empire.

See for example wikipedia

Nagging Questions about Afghanistan

An NBC News report last week painted a picture of military futility in Afghanistan. The more recent large operation in Helmand has a more cogent rationale, but it to suffers from viewing the Afghanistan fight as a US operation. Robert McNamara’s death reminds us that we will lose if we view it as our fight rather than as the fight of local (not initially national) partners who we contrive to support.

1) NBC Nightly News last week had a few minutes of a fire fight with a Marine unit. The Marines hiked up to a seemingly deserted unit, saying along the way that they expected to be ambushed because they figured locals would have tipped off the Taliban. Sure enough they set up and were attacked by about ten enemy, of which they thought they killed maybe three, with no US casualties. The Marines and the Taliban fought with essentially the same weapons, though the Marines could call in air strikes if needed. No advanced technology was in evidence on the US side. The US forces were not accompanied by any Afghani nationals. In fact, given that the “Taliban” may have been non-Afghani forces, it’s possible that no one from Afghanistan was involved in the episode. NBC saw this engagement as a success, primarily because of the lack of US casualties but what did it accomplish? Practically, nothing, except perhaps demonstrating that the US did not control the area. Why are we sending US forces to fight for no real tactical or strategic purpose and without any decisive military capability?

2) The large operation of the Marines in Helmand province has an entirely different focus — to move in and protect the people with a permanent US force presence, rather than kill the enemy. This is the counter-insurgency theory that is at the heart of current US military thinking. The Center of a New American Security (CNAS) in Washington DC is a hotbed of this counter-insurgency (COIN) thinking — it’s worth looking at www.cnas.org, and particularly the paper by Exum, Fick, Humayun, and Kilcullen entitled Triage: The Next Twelve Months In Afghanistan and Pakistan, and the one by LTC Jim Crider (US Army), entitled Inside the Surge: One Commander’s Lessons in Counterinsurgency, based on his experience during the “surge” in Baghdad. Crider is especially good on recognizing the crux of the issue is the contest for intelligence, which we were bound to lose so long as we did not fully engage the locals.

3) Robert McNamara’s death reminds us that COIN was a buzzword back in 1962 as well, when he thought we were winning in Vietnam. In the end, if there are not indigenous forces that are upright and attractive to their compatriots that want to succeed as much as the insurgents, then nothing outsiders can do will prevail. The outsiders just become the target for nationalist mobilization. In their can-do American spirit, the CNAS folks talk about what “we” should do to win in Afghanistan, and they offer solutions that hinge on improving the capacity of Afghanistan’s central government and its military and police forces, and they want to stay as long as is necessary. What “we” Americans ought to be doing in Afghanistan is helping to identify and reinforce local power structures that can protect their own local people, with (for a time) US forces and (soon) regional police or central government forces providing strike forces to deal with insurgent concentrations that might overwhelm local capabilities.

Update: The July 8 NYT reports “Allied Officers Concerned by Lack of Afhan Forces.” It’s important to note that owing to ethnic and cultural differences within Afghanistan, central forces may not be all that much better than American ones.

Positive Train Control

Metro testing suggests that a single-point failure in the block control system caused Monday’s fatal crash. This is an unacceptable design and Metro should shift to a positive location model with the block control system as back-up.

It seems that Monday’s fatal metro train crash in Washington DC was caused by a failure of a block control signal that should have indicated the presence of a train in a block of track. It is incredible to me that in the 21st century that such a single failure point could result in a crash. Apparently Metro has two other train location information systems but neither has direct authority over the trains.

In other words, so far as positive train control is concerned, trains can just disappear from the system if a block sensor is defective. Instead, Metro should have a system that maintains continuous knowledge of where a train could be based on the totality of information from various sensors (including GPS when trains are in the open and other positive location techniques when trains are in tunnels), and this picture should be extended by physics to provide a range of uncertainty about where trains could be based on the information in the system. The block control information should serve as a back-up to this positive control picture, stopping trains as necessary but only once the primary system has failed to provide adequate control.

All trains that could possibly overlap in space should come to a stop when the block control information diverges from the positive control model. The block control information and the identified train location information should be continually checked against each other, triggering train stoppages and immediate repair to resolve any discrepancy.

Disclaimer: I am not a transit engineer and am relying solely on information published in the Washington Post.

Recovery, Inflation, and Oil

Forestalling future inflation is not just a matter of investment vs. consumption; smart policies to ease recovery bottlenecks (especially oil shocks), improve competitiveness, and improve the efficiency of health care are also important.

Jonathan reiterates a useful point on biasing deficit spending toward capital investment that increases future potential output. (Even current investment that substitutes for future needed capital expenditures –for example rebuilding national parks infrastructure– that do not themselves increase potential output is better than consumption, if it can be spent out quickly enough). If inflation is a matter of too much money chasing too few goods, then enlarging the supply of goods can help.

But it’s important to be clear that smart policy and investment today can affect future output in two important ways not usually accounted for in growth theory. As suggested here previously, it is important to take the interactions among economic forces into account.

First, dynamics are important. Supply-side inflation via higher prices of inelastically supplied commodities (especially oil) is a key way recoveries are choked off. Thus the right energy policies — including policies and investments to reduce the oil intensity of our GDP — are crucial to reducing future inflationary pressures and increasing the path of future output. Such action is needed for energy security and carbon reduction reasons as well as macroeconomic management, so it’s a threefer.

Second, the composition of GDP is important. For example, much of our health care spending is the economic equivalent of empty calories– by making the health care sector provide better health to more Americans at lower cost, we free up funds for future investment and also improve the amount and productivity of our human capital. Reducing the rate of health care inflation and disconnecting health care from production costs will improve our manufacturing competitiveness, strengthening the dollar, reducing the overall inflation rate, and freeing up resources for potential-increasing investments.

Forestalling future inflation is not just a matter of investment vs. consumption; smart policies to ease recovery bottlenecks (especially oil shocks), improve competitiveness, and improve the efficiency of health care are also important.

Domestic (non-Islamic) Terrorism Kills Again

George Tiller, a doctor who was a long-time target of anti-abortion groups, was murdered today in a Kansas church.

George Tiller, a doctor who was a long-time target of anti-abortion groups, was murdered today in a Kansas church. Thus iIt appears that today a U.S.-based Christian terrorist has done what no Al Qaeda related groups have done since 9/11 — killed an American on US soil. I hope AG Holder and the Judiciary committees will address with the FBI whether enough effort is being devoted to infiltrating and taking down fundamentalist networks and groups who have threatened and killed Americans.

Even if it ends up that a lone individual did the deed, the climate of hatred and menace kept up by anti-abortion forces should not be discounted as a permissive factor.

Finally, Operation Rescue should be ashamed that it offers no help in or hope of bringing Dr. Tiller’s killer to justice, though it has time in its statement to unctuously offer his family the peace of Jesus Christ after it hounded him in life, long after the potential for violence was made clear –previously his clinic was bombed and he was shot in both arms

From the AP/ Huffington Post:

WICHITA, Kansas — Dr. George Tiller, a Kansas doctor whose clinic received national attention for performing late-term abortions, was shot to death as he entered his Wichita church on Sunday.

“Members of the congregation who were inside the sanctuary at the time of the shooting were being kept inside the church by police,” the Wichita Eagle reported, “and those arriving were being ushered into the parking lot.”

Media reports said the suspected killer fled the scene in a blue Taurus. Police described him as a white male in his 50s or 60s.

Tiller has been among the few U.S. physicians performing late-term abortion, making him a favored target of anti-abortion protesters. He testified that he and his family have suffered years of harassment and threats. His clinic was the site of the 1991 “Summer of Mercy” protests marked by mass demonstrations and arrests. His clinic was bombed in 1985, and an abortion opponent shot him in both arms in 1993.

Tiller’s clinic also provided group and individual counseling, as well as chaplain and funeral services for people who were grieving. ….

Update A suspect is reportedly in custody