Category Archives: Business

For Fools Who Think Cutting Government Spending Hurts Economies

Here’s an old, but still valid post:

Lots and lots of papers* have now studied this question and the evidence is rather clear: the types of austerity that are most-likely to a) cut the debt and b) not kill the economy are those that are heavily weighted toward spending reductions and not tax increases. I am aware of not one study that found the opposite. In fact, we know more. The most successful reforms are those that go after the most politically sensitive items: government employment and entitlement programs. Lastly, there is evidence that markets react positively when politicians signal their seriousness by going against their partisan inclinations. In other words, the most credible spending reductions are those that are undertaken by left-of-center governments. So slash away, Mr. Obama!

My emphasis. But don’t hold your breath on that one.

More On The SpaceX Anomaly

…from Alan Boyle. I don’t think this is quite right, though:

What caused the engine’s sudden pressure release, which was apparently strong enough to blow off the fairing?

I think this is a misstatement of the issue. I could be wrong, because we’re still awaiting clarification from SpaceX, but my understanding is that when they shut the engine down, and there was no pressure field coming from the nozzle, the differential pressure resulting from Max Q resulted in it “imploding” inward and breaking off (and perhaps taking the nozzle with it, but that’s less clear). All that is clear is that SpaceX claims that the powerhead itself wasn’t damaged, because they continued to receive telemetry from it.

I should note that if this is the case, it eliminates any earlier concerns about the upper-stage engine causing a catastrophic failure, though questions remain about about why Orbcomm is in the wrong orbit. This is clearly a second-stage issue.

[Update a couple minutes later]

Here’s the current story from Joe Pappalardo at Popular Mechanics. I’ll probably be elaborating on it after getting more info from SpaceX.

Ruh Roh

GM may yet have to go through a real bankruptcy:

Well, what do you know, the Obama Administration didn’t reveal all the details to the judge. Is anyone surprised that this gang of Chicago thugs decided that the judge didn’t need to know the sweetheart deal that would save their union buddies?

It sounds like Judge Gerber is ready to reopen the whole thing, essentially forcing GM into a real bankruptcy, including having to pay back the $27 billion to the Treasury… which, given that they only have about $30 billion on hand, could spell the end of GM.

Or at least the end of the sweetheart deal.

More SpaceX Launch Problems

A BBC reporter is reporting that the Orbcomm was deployed into a wrong orbit, as a result of a failure of the upper stage to restart. More at New Space Watch. This is actually a more serious problem than the first-stage failure, from a business standpoint, since it was actually a mission failure for the secondary payload. Next question: is Dragon in an orbit that can still rendezvous with the ISS? How much propellant reserve do they have?

[Update a while later]

SpaceX is sticking by their story that the engine didn’t explode, and that it was a fairing rupture after a controlled shutdown (though there was no initial discussion of the fairing issue). I have no reason to doubt it.

The Neo-Puritans

of both parties:

For the half hearted worldling like myself, who can never quite summon up all the moral fiber necessary for a grimly earnest New England crusade, all forms of Puritanism are suspect. But unlike the “Christianists under the bed” crowd over at the Daily Dish, I’m less worried about the puritanism of the right than the puritanism of the left these days. First, because American society is so firmly set against old fashioned right-wing prudishness, Romney’s “conservative” puritanism is probably a lesser threat to the freedoms of the people than the secular puritanism of the enlightened left. Public acceptance of homosexuality is likely to increase, for example, no matter who takes office next January; even after eight grim years of two Romney terms, you are still going to be able to see bare breasted women on “Boardwalk Empire” and “Game of Thrones.” Romney and the right are fighting the tide on many of these issues, so any efforts on their part to force more moral conformity on the population are unlikely to go all that far.

The other reason I worry less about the right’s tendency toward moralist dictatorship is federalism: the left likes its regulation at the national level and thinks the Federal government should set the tone for the whole country. The right on the other hand makes more room for the states. If we must be governed by meddling nanny state puritans, I would rather live in a country that had fifty petty moralistic dictatorships rather than one big one; I’d at least have a chance of finding a place where my favorite foods and amusements wouldn’t be banned by law. Surely there will be one state somewhere in this republic that will let me put some extra salt on my freedom fries.

Professor Mead doesn’t expand on the theme of this as being one of the folkways described in Fischer’s Albion’s Seed, but ever since reading that book it has always been clear that the “progressives” are the current incarnation of the Puritan tradition that came over from East Anglia in the seventeenth century. It was very clear that Hillary fell into that camp (whereas Bill was a redneck). But I had never thought before of the Mormons as being an offshoot of it. It makes sense. They’re not descended from Quakers, or the Cavaliers, and certainly not the Scots-Irish. So there are some similarities between Obama and Romney, but for the reasons that he mentions in the quote above, I’m much less concerned about Romney in that regard.

This discussion reminds me of my post from years ago about why we should worry much more about Leftist urges to control us than that of the social-issues right. Will Wilkinson disputed it at the time (though the specific example he used of Ashcroft’s fear of a marble tit turned out to be a Democrat urban myth). I wonder what he thinks now, given the economic disaster confronting us from the Democrat depradations of the last six years?