How Serious Is The Terrorist Threat?

USA Today reports that prosecutions for terrorist acts are down. Either there is not much of a terrorist threat, or the US Government is not finding it.

The first article in the current Foreign Affairs magazine argues that the terrorist threat to the US has been overblown. The summary of the article is:

Despite all the ominous warnings of wily terrorists and imminent attacks, there has been neither a successful strike nor a close call in the United States since 9/11. The reasonable -- but rarely heard -- explanation is that there are no terrorists within the United States, and few have the means or the inclination to strike from abroad.

President Bush is probably truly scared. I think he is a coward. He was asleep at the switch and allowed the 9/11 attacks to occur. They could have been prevented by slightly better airport security. All this Homeland Security TSA nonsense is largely irrelevant. It has helped prevent hijackings, but so would have slightly beefed up security of the pre-9/11 variety.

All Holocaust All the Time

Two recent articles point out how the press and the business/legal world is all Holocaust all the time. The Financial Times reports that Jews are suing the French railway SNCF for transporting Jews to concentration camps during World War II. Apparently one case has already been won Alain Lipietz.

The New York Times reports that a Jewish artist who painted Gypsies at Auschwitz wants her paintings back, which are currently on display at the prison camp museum in Poland. What is interesting about this is that Gypsies, whom she painted, went thought the same Holocaust, but have in general suffered much more since then than the Jews, who like Ms. Babbitt have become upper or middle class, while the Gypsies remain mired in poverty. (See, for example, this FT article on the Roma (Gypsies) of Slovakia.) Why should Ms. Babbitt profit more from painting these Gypsies than the Gypsies who served as her models under Dr. Mengele's orders. She cooperated with Dr. Mengele in portraying what was to Dr. Mengele the Gypsies' racial inferiority. Shouldn't the poor Gypsies get some kind of war reparations against her instead of her getting something from Poland?

Her position raises indirectly a question that bothers me: What did the Jews, who now scream "Holocaust!" at the top of their lungs do to stop it? What percentage of Jews fought in combat in Europe to free to prison camps. I have a cousin in Alabama (a Christian, redneck state) who took part in liberating a concentration camp in Germany. How many American Jews in the military liberated their brother Jews from these prisons? My impression is that many of them (e.g., Roosevelt's Treasury Secretary Morganthau) leaned on Roosevelt to send more Christian soldiers to die liberating Jews, while they stayed behind to profit from the war.

Certainly Israel would not have been created had it not been for the Holocaust, which Jews used as an argument for the state's creation. They had been trying for years to create Israel, and the Holocaust was what made their previous unsuccessful efforts, ultimately successful.

I'd like to know prominent Jews today asked their fathers, "What did you do in the war daddy to save Jews from the Holocaust?" What did Robert Rubin's father do? What did Stuart Eizenstat's father do? What did Sandy Weil's father do? What did Haim Saban's father do? What did Martin Indyk's father do? What did Sen. Schumer's father do? What did Raum Emanuel's father (or grandfather) do?

An exception, Sumner Redstone, worked breaking Japanese codes during WW II. Hooray for him! Sen. Spector's father served in WW I. Good for him!

Did Richard Armitage Leak Valerie Plame's Name?

Update: The NYT reports that Armitage has admitted that he was Novak's source.

It seems more and more likely that Colin Powell's deputy at State, Richard Armitage, leaked Valerie Plame's name to Robert Novak, as Political Animal says. Richard Armitage seems to be a straight shooter, which would justify Novak's comment that his source was not a partisan gun slinger. However, if that's the case, why hasn't Armitage come forward? Novak called for his source to identify himself last week on "Meet the Press."

It's possible that Armitage did not leak Plame's name, but only mentioned something about Amb. Joe Wilson's wife. Then Novak may have looked up Joe Wilson in Who's Who, where I think Wilson's wife is listed as Valerie Plame.

It seems likely that Armitage is cooperating with Special Prosecutor Fitzgerald on the Plame case, and thus may be a witness when Scooter Libby's case comes to trial, but we may not know before then.

How Reliable Are Productivity Estimates?

Reporting on the Federal Reserve retreat in Jackson Hole, the Financial Times said:

Gene Grossman, a professor at Princeton, offered the central bankers a new way of thinking about the problem [of globalization's downward pressure on most wages], which paints offshoring in a more positive light. He argued that we should think about trade not as an exchange of good but an "exchange of tasks". If some tasks that used to be performed onshore are offshored to lower-cost locations, the result will be an increase in the productivity and wages of workers who perform related tasks that cannot easily be offshored.

Analysis of the US from 1997 to 2004 suggests this positive productivity effect could outweigh the negative labor supply effect on wages in sectors where there had been a lot of offshoring. But it does not appear large enough to offset the broader negative effect on low-skilled wages arising from the ongoing fall in the relative price of labour-intensive goods.

Although even this analysis concludes that offshoring is a mixed blessing, to me it indicates the difficulty in separating offshoring from productivity estimates. I am inclined to believe that much of ex-Fed chair Greenspan's touting of productivity increases to account for the lack of inflationary pressure is really due to offshoring. For example, because of the lower wages, businesses can hire several foreigners for the salary of one American. They will produce more work (be more productive) for the same cost to the business. Thus, if you look at an income statement, it looks as if you get more output for the same input, but the only difference is that more work is being done overseas. Automation, computers, networking, etc., do make American workers more productive, but can you separate out those factors from offshoring? I don't think so, at least not well. All of which means that the only people benefiting from the increase in "productivity" are those at the top of the pyramid, CEOs and a handful of senior executives. The average workers suffer, not only the "low-skilled" mentioned by Grossman.

Interestingly, the article below this one in the FT is "Flows that slip through statisticians' hands."