Highlighted Article
U.S. Middle East Policy - A Road to Disaster

Isn't it time for the United States' new State department to prevent additional United States foreign policy debacles? Look at the record. From Vietnam to Angola to Nicaragua, Somalia and on to Iraq and Afghanistan, United States foreign policies degraded into military interventions and proved counterproductive - accomplishing the very results the policies were formulated to prevent. Regimes, which the U.S. intended to replace either became strengthened (Vietnam, Angola), returned in almost equal form (Nicaragua), evolved to a more antagonistic form (Somalia), or remained unresolved (Afghanistan, Iraq). With a trajectory similar to previous escapades, U.S. policies towards the larger Middle East can be forecasted to achieve similar counterproductive results. U.S. policies are on a road to disaster for Middle East nations and the American people. A new road, which averts disaster, can be conveniently chosen.

Comments
A Breath of Fresh Air

If the nation's capital needs anything this winter, it's a breath of fresh air. Too bad we can't bottle Paul Volcker, economic advisor to President Obama and Carter's former chairman of the Federal Reserve Board. It's nice to have him here. Fareed Zakaria proved that on February 14, 2010 in his interview with the 6' 8" Paul Volcker.

ZAKARIA: Explain to the average viewer what is at stake here. Why is it important to get this financial reform passed?

VOLCKER: If a big, non-bank institution gets in trouble and threatens the whole system, there ought to be some authority that can step in, take over that organization and liquidate it or merge it -- not save it. It's what I call euthanasia, not a rescue.

And that has to be clear enough so that you avoid the so-called "moral hazard," that people think they're going to be rescued and, therefore, will take risks that they shouldn't be doing, in my view. This is what we pushed, what the president has accepted. They shouldn't be doing highly speculated activity. They shouldn't be doing so-called "proprietary" activity, where they're off there trading for their own interest. They're trading to make money.

And you get very aggressive traders, and they're out there. Millions of dollars are at stake, and personal bonuses, so they have a real incentive to take risks, which is fine, if you're not being protected by the government.

ZAKARIA: You've been around Washington, in and out, for 40, 45 years. Have you -- is this the worst...

VOLCKER: Yes.

ZAKARIA: You saw this crisis coming. You gave several speeches in which you outlined why you thought we were at a very dangerous point, in some cases, a year-and-a-half, two years before it hit.

What did you see that worried you?

VOLCKER: Well, this country, I'm afraid, went on a kind of consumption binge.

ZAKARIA: So, the core problem is that Americans started consuming too much...

VOLCKER: Right.

ZAKARIA: ... and consuming more than their historical averages. And that's perhaps what really got us the growth of the last 10 or 15 years.

VOLCKER: That certainly -- that gave a rosy complexion to the growth. That's correct. But it was built on a foundation that can't persist.

We need to do more manufacturing again. We're never going to be the major world manufacturer as we were some years ago, but we could do more than we're doing and be more competitive. And we've got to close that big gap.

You know, consumption is running about 5 percent above normal. That 5 percent is reflected just about equally to what we're importing in excess of what we're exporting. And we've got to bring that back into closer balance.

ZAKARIA: You feel that the longer term issue, the big issue is really this issue of how do we get real growth. How do we get exports, manufacturing -- not growth that's based on borrowing, not growth that's based on each of us selling each other our own houses in a kind of ascending spiral...

VOLCKER: Absolutely.

VOLCKER: We've got to produce something that somebody else wants to buy.

VOLCKER: All of those things add up to some extent. And some of it is kind of a mystery, in a way. I hate to pick a particular industry, or whatever, and just anecdotally. But I understand that the cost of shipping a ton of steel from China to the United States, one ton, is about the same as the total labor cost to produce a ton of steel in the United States.

So, if, in effect, it's not all our labor costs, they're offset by the transport cost, why are we still importing so much steel?

The challenge is very substantial. I think we can do it. I mean, we used to be, not so long ago, the world's greatest manufacturer. And we haven't got any big cost disadvantage relative to Europe or other developed countries. But the emerging world certainly has a big competitive advantage.

Kudos for Alternative Insight for having written similar assertions in several articles during the last three years.

Observations
Economic Freedom

Index of Economic Freedom World Rankings
Year 2010 Overall Score

Free 
1 Hong Kong          89.7 
2 Singapore            82.6 
4 New Zealand       82.1 
5 Ireland                 81.3 
6 Switzerland         81.1 
7 Canada                80.4

Mostly Free
8 United States     78.0 
9 Denmark             77.9 
10 Chile                  77.2

13 Bahrain             76.3

15 Netherlands     75.0

18 Iceland              73.7

23 Germany          71.1

Moderately Free
43 Oman                67.7 
44 Israel                 67.7
45 Peru                  67.6
64 France              64.2
73 Greece             62.7

Mostly Unfree
124 India               53.8 
140 China              51.0
143 Russia            50.3

Repressed
144 Vietnam         49.8

http://www.heritage.org/index/topten.aspx

But what can a decent man speak of with most pleasure?

Answer: Of himself.

Well, so I will talk about myself.

Fyodor Dostoevsky
Notes from the Underground

More than 300 different lanterns, including 100 from Taiwan, lit up the park running along the Confucius Temple-Qinhuai River scenic belt, kicking off the fair. (Xinhua Photo)