Italy moves to adopt balanced budget amendment to constitution

From the Financial Times:

The measures included a plan to amend the constitution to make a balanced budget mandatory, a second constitutional change that would force “closed professions” to liberalise services, a speeding up of welfare reforms, and other structural reforms designed to boost Italy’s stagnant economy. . . .

The German government has already firmly dismissed a proposal from José Manuel Barroso, president of the European Commission, for an increase in the size of the €440bn European financial stability facility – the eurozone rescue fund. Philipp Rösler, the German economy minister and vice-chancellor, described the proposal as “ill-timed”. . . .

Promising to bail out countries is exactly the wrong solution. It creates no incentive to control spending in countries facing financial problems.

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Copy of Standard & Poor's explanation for Downgrading US Bonds

A copy of S&P's report is available here. The report warns of further possible downgrades. S&P is basically calling for tax hikes. I am not sure how they reach this conclusion as opposed to calling for more spending cuts. No real explanation is given on this point.

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Racial Violence in Wisconsin

This is pretty scary. Why would groups of blacks just start attacking white people? One white man gives them a cigarette and things that he is just being friendly and then they attack. Other people sent to the hospital. Some of this might be due to the high black teenage unemployment rate, which is a tragedy, but one wonders what more is involved. One hopes that something more is involved.

Witnesses Describe Mob Attacks Outside Wis. State Fair

Witnesses describe mobs, some people claim racially-charged attacks

State Fair melees produce 11 injuries, 31 arrests

UPDATE: Just one arrest? Here is a new story available from WLS.

The investigation into 11 of the violent incidents on the opening night of the Wisconsin State Fair has resulted in the arrest of a 16-year-old African-American who reportedly told investigators he targeted whites.
Wisconsin Gov. Scott Walker was asked on WLS Radio’s Roe and Roeper Show Friday if he thought the crimes warranted hate crime status, “I think it is absolutely outrageous, it is a hate crime, and I would imagine the prosecutor will be very aggressive on this. There is no tolerance whether it’s white on black or black on white, there shouldn’t be any tolerance in general for that kind of problems.”
. . . The Milwaukee teen was booked on suspicion of attempted robbery and robbery. Police recommend that he face additional penalties for hate crimes.
Police say the teen told investigators whites were chosen because he considered them "easy targets."
On opening night of the fair last week, 31 people were arrested and at least 11 people were hurt. The West Allis Police Department has said race was a factor in the 11 violent incidents it's investigating. . . .

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Two interesting polls

1) 69% Say It’s Likely Scientists Have Falsified Global Warming Research

While a majority of Americans nationwide continue to acknowledge significant disagreement about global warming in the scientific community, most go even further to say some scientists falsify data to support their own beliefs.
The latest Rasmussen Reports national telephone survey of American Adults shows that 69% say it’s at least somewhat likely that some scientists have falsified research data in order to support their own theories and beliefs, including 40% who say this is Very Likely. Twenty-two percent (22%) don’t think it’s likely some scientists have falsified global warming data, including just six percent (6%) say it’s Not At All Likely. Another 10% are undecided. . . .
Fifty-seven percent (57%) believe there is significant disagreement within the scientific community on global warming, up five points from late 2009. One in four (25%) believes scientists agree on global warming. Another 18% aren’t sure. . . .

2) Throw the bums out: "62% Would Vote to Replace Entire Congress"

I guess that I don't find this poll particularly new or surprising. In the past, there were a lot of polls showing that people wanted to get rid of other people's congressmen but keep their own. This might be a little broader.

No matter how bad things are, 63% of Likely Voters believe Congress can always find a way to make them worse. Only 20% disagree with this pessimistic assessment.
If they could vote to keep or replace the entire Congress, a new Rasmussen Reports national telephone survey finds that 62% would vote to dump all the current legislators and start over again. Just 15% would keep the existing Congress, while 23% are undecided. (To see survey question wording, click here .)
It’s not just Congress in general that make voters skeptical. Just 32% of voters are even somewhat confident that their own representative in Congress is actually representing their best interests. Sixty-five percent (65%) don’t share that confidence. . . .

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Newest Fox News piece: The S&P Downgrade Is a Wake Call for All Americans

My newest piece at Fox News starts this way:

When Standard & Poors downgraded Spain's bonds from AAA to AA+ in January 2009, its interest rates increased from 4.1 to 4.3 percent.
When the same ratings agency downgraded Ireland's from AAA to AA+ in March 2009, their interest rate rose by about 0.4 percentage points.
So what does that mean for Standard & Poors in terms of downgrading the U.S. bond rating?
With our $14.6 trillion in national debt, raising the U.S. government interest rates by the same amounts would eventually add about $29 to $58 billion a year in increased interest costs -- small change when we are already facing a $1.63 trillion deficit this year. And not all of that increase would be immediately felt since we only face the higher interest rate on newly issued bonds.
The problem with these downgrades is that they have a tendency to quickly spiral out of control. . . .

UPDATE: From The Hill newspaper:

Treasury Secretary Tim Geithner said Tuesday there is "no risk" the U.S. will lose its top credit rating amid a new analysis that revised its outlook on American debt to "negative."

Geithner took to the airwaves of financial news networks to push back against a report Monday by Standard & Poor's that lowered its outlook on U.S. debt to "negative," reflecting political uncertainty over whether lawmakers will reach an agreement to address long-term debt.

There is no chance that the U.S. will lose its top credit rating, Geithner said, forcefully disputing the notion that S&P or other ratings services might downgrade U.S. bonds from their current AAA rating.

"No risk of that, no risk," Geithner said on the Fox Business Network. . . .

Obama got what he wanted on the length of the deal to raise the debt ceiling, but we still got the downgrade of the credit rating.

Transcript from Obama's July 25, 2011 address to nation:
First of all, a six-month extension of the debt ceiling might not be enough to avoid a credit downgrade and the higher interest rates that all Americans would have to pay as a result. We know what we have to do to reduce our deficits; there’s no point in putting the economy at risk by kicking the can further down the road. . . .

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Some real economic damage caused by Obama's FCC

This may be a story about how the Obama "Stimulus" program will do many tens of billions of dollars of damage. From the Economist:

The “NextGen” air-traffic control system, which uses GPS satellites to pin-point every plane’s precise position in the sky once a second, plus onboard radios that let each aircraft continually see (and be seen by) all others nearby, is to be rolled out in 2012 and fully implemented by 2022. . . .
. . . due to regulatory haste and shortsightedness, GPS coverage of America could soon go dark in places and become patchy elsewhere. Not only airlines would suffer. There are over 500m GPS receivers in use throughout the United States. Motorists, mobile-phone users, boat-owners, television broadcasters, the police, the armed forces, the emergency services and even farmers would be adversely affected. . . .
The ultimate source of the trouble is a decision made in 2003 by the Federal Communications Commission (FCC) to grant special dispensation to a broadband satellite operator called SkyTerra, allowing it to fill gaps in its coverage by means of ground-based transmitters. SkyTerra’s chunk of spectrum (1,525-1,559 megahertz) abutted a crucial frequency (1,575 megahertz) used by GPS satellites. However, SkyTerra’s signals being mere whispers from space and its few proposed ground stations designed to operate at low power, any threat to GPS was dismissed as highly unlikely.
Everything changed when Harbinger Capital Partners, a New York-based investment firm founded by subprime-mortgage billionaire Philip Falcone, bought SkyTerra in 2010 and renamed it LightSquared. . . .
Mr Falcone quickly persuaded the FCC to rewrite the former SkyTerra licence. Instead of being conditional on offering an internet service primarily by satellite, with ground stations filling in only where satellite coverage was inadequate, the revised licence accepts that the network will rely almost exclusively on terrestrial transmitters.
And not just low-powered ones for serving inner cities. . . .
How this came about is a sorry tale of greed, haste and incompetence. Though politically savvy, the FCC is not noted for having the sharpest technical knives in the drawer. According to Aviation International News, last year it accidentally sold the total block of frequencies reserved for the B-2 stealth bomber. In the case of LightSquared, the FCC has no excuse for allowing a national network of high-powered transmitters to operate so close to GPS’s frequency. . . .
But in the rush to reallocate underused parts of the spectrum—to fulfill the White House’s promise to deliver high-speed internet connections to everyone in the country—the FCC has been guilty of riding rough-shod over objectors. . . .

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Maxim's new piece at Fox News: Proposed U.N. Treaty to Regulate Global Firearms Trade Raising Concerns for U.S. Gun Makers

Maxim's piece starts out this way:

A controversial U.N. proposed treaty aimed at regulating guns worldwide has been shrouded by confusion and misinformation.
Known informally as the 'Small Arms Treaty,' its detractors have charged the proposed agreement with secretly trying to take guns out of the hands of Americans and circumventing the 2nd Amendment.
While that is unlikely, a working draft proposal obtained by FoxNews.com contains language that some gun advocates say could have a real impact on American gun makers.
Last month a U.N. committee met in New York and signed off on several provisions, including the creation of a new U.N. agency to regulate international weapon sales, and require countries that host firearms manufacturers to set up a compensation fund for victims of gun violence worldwide. . . .

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The debate over the death penalty is being picked up again in the UK

Dr Tim Stanley, a research fellow in American History at Royal Holloway College, has a piece in the UK Telegraph. Among his points:

Opponents will point out that the death penalty is practiced in the states with the highest murder rates. This is true, but it doesn’t mean that executions don’t work – it just means that they take place where they are needed most. The states without the death penalty historically have lower than average levels of crime. When the death penalty was suspended nationwide from 1968 to 1976, murder rates went through the roof – except in those states. When the ban was lifted, the states that reintroduced the death penalty saw an astonishing 38 per cent fall in their murder rate over twenty years. Indeed, there is a statistical relationship between the growth in executions and the decline in murder. According to John Lott, author of Freedomnomics, “between 1991 and 2000, there were 9,114 fewer murders per year, while the number of executions per year rose by 71.” In his own studies, the only exception to this rule proved to be multiple victim public shootings, like the Virginia Tech Massacre. The reason is obvious: the perpetrators expect to die while carrying out their crime and invariably do. . . .

It is nice to see that Freedomnomics is getting some attention in the UK.

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New Fox News piece: Looks Like We're In a Recession, Not a 'Recovery'

My new piece starts this way:

There seems no place to hide. Americans have seen the value of their stock portfolios crash this week. The S&P 500 and NASDAQ have both lost about 8 percent of their values, and they are headed down again today.
This week the Japanese NIKKEI stock market also lost over 9 percent of its value. And the UK's FTSE has lost over 11 percent. The German DAX about 13 percent.
So much for promises that if we only passed the debt ceiling increase the stock markets would be calmed.
Everyone was waiting for today's unemployment numbers to be released. The 117,000 new jobs temporarily lifted spirits because the number was better than what many had expected, but it was still not enough new jobs to even absorb more than three-quarters of the growing working-age population. Unemployment fell because 193,000 more people simply gave up looking for work.
Indeed, people giving up looking for work has been the hallmark of the Obama administration. . . .

Fox News also has this useful news story: "When Good News is Bad: Unemployment Rate Drops as Workers Bolt Labor Force"

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Jake Tapper takes on Carney government doesn't create jobs

You have got to respect Jake Tapper. I have to apologize to him for whatever negative posts that I have ever put up on him. This guy is a true journalist who is willing to put his personal feelings aside.

RUSH: Yesterday at the White House Jay Carney, White House press secretary, said, "We don't create jobs here. We only create an atmosphere where jobs can be created. We don't create jobs here." Which means that you guys have created a lousy atmosphere. This is yesterday in Washington, a reporter said to Carney, "Why should Americans believe that the White House can create jobs when the unemployment rate's been stagnant and we have record unemployment?"

CARNEY: The White House doesn't create jobs. The government together -- White House, Congress -- creates policies that allow for greater job creation. . . .

See this post from Jake Tapper.


John Stossel shows how little changed government spending will be from the Debt Ceiling agreement

John Stossel has a useful post on his blog available here. From his post:

Spending won't be cut at all. It's only a "cut" compared to increases the CBO "assumed". Imagine if you ran your budget that way. Dinner conversation might go like this: "Since we're so deep in debt, I've decided to cut spending next year. Instead of a new Lexus, I'll buy a Dodge." . . .

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This is a recovery?: Comparing the percent of the population not in the Labor Force during the Reagan and Obama Recoveries

Looking at these graphs gives one an understanding about how misleading the simple unemployment numbers are. People are only counted as unemployed as long as they are actively looking for work. During Reagan the unemployment rate fell dramatically from 10.8% (a higher rate than the so-called "Great Recession") to 7.3% in two years. During the Obama "recovery," the unemployment rate has gone down from 9.5% to 9.1%, but this much smaller drop is more illusory for the obvious reason shown in the above graphs.

While the working age eligible population keeps rising, jobs have been flat.

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Goolsbee on jobs: 'One month is not a trend'

The "one month is not a trend" claim from Austan Goolsbee has gotten a little old. Unemployment has gone up for three straight months and there is a good chance that it will go up again tomorrow. If it does go up for four straight months, can we call that a trend?

March 8.8%
April 9.0%
May 9.1%
June 9.2%
July ???%

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"FAA Shutdown Idled Far Fewer Than the 70,000 Construction Workers Democrats Claimed"

From Fox News:

When Senate Majority Leader Harry Reid announced Thursday a bipartisan compromise to end a political stalemate over funding the Federal Aviation Administration, the Nevada Democrat said that 74,000 transportation and construction workers would be able to return to work – a figure that has been cited often by other congressional Democrats and Obama administration officials during the two-week shutdown.
There’s only one problem: Democrats exaggerated.
“It’s probably about 24,000 construction workers who are out of work,” said Stephen Fuller, an economist at George Mason University. “That’s a pretty important number, especially to those workers, but it isn’t 70,000.”
Fuller conducted an industry study that found 70,000 airport construction workers would be “affected” in some way by the shutdown, not idled. However, the 4,000 FAA furloughed as a result of the shutdown is correct. . . .

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NYC Democratic Congressional Candidate Won't Say if He will Support Obama for President

Even in NYC Democrats are distancing themselves from Obama? Kansas or the Midwest or the South I can understand, but NYC? From the NY Post:

The Democratic candidate seeking to fill the congressional seat vacated by randy ex-Rep Anthony Weiner distanced himself from President Obama today — by refusing to say whether he backed the president’s re-election.
“I’m running myself right now. On Sept. 14, I’ll be happy to address the president’s election,” State Assemblyman David Weprin said following a press conference at Queens Borough Hall, where he was endorsed by a bevy of female elected leaders.
The special election to replace Weiner — who resigned in disgrace following a sexting scandal — will be held on Sept. 13.
“Don’t read anything into it,” Weprin insisted of his refusal to give fellow Democrat Obama a thumbs up.
Bob Turner , who challenged Weiner last year, is the Republican candidate.
Weprin is the favorite to win the race in the heavily Democratic Queens-Brooklyn district. But Obama’s popularity has plummeted and some moderate and conservative Jews — who make up a considerable portion of the electorate — are concerned Obama’s push to get Israel to use its 1967 borders as a starting point for negotiations over a Palestinian State. . . .


Democrats Happy with Debt Ceiling Deal, Republicans Not at All Happy

From a USA Today/Gallup Poll:

The poll showed 58 percent of Democrats approve of the deal, compared with just 26 percent of Republicans. A whopping 64 percent of Republicans disapproved.
Further, only 22 percent of Tea Party supporters reported being happy with the compromise package.
The numbers belie the claims being made on Capitol Hill that Democrats were dragged into signing off on what one lawmaker described as a "sugar-coated Satan sandwich," with the creditworthiness of the United States on the line. . . .

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More bad economic reports

Even the New York Times can't get around listing the bad economic reports, though this is described as "weak economic growth."

Service businesses like restaurants, hotels and financial companies experienced their weakest growth in 17 months in July, a new report said Wednesday. . . .

The trade group of purchasing executives said its index for services companies fell to 52.7, from 53.3 in June. Any reading above 50 indicates expansion.

The I.S.M. index covers 90 percent of the work force. It reached a five-year high of 59.7 in February, but has fallen since then. The July reading was the lowest since February 2010. . . .

Separately, the Commerce Department reported that businesses cut orders for airplanes, autos and heavy machinery in June. Factory orders dropped 0.8 percent, the second decline in three months.

Demand for durable goods fell 1.9 percent in June. Durable goods are products that are expected to last at least three years. . . .

Consumer spending, which drives 70 percent of economic activity, fell in June for the first time since September 2009.

And manufacturers recorded their weakest growth in two years in July, according to the separate I.S.M. manufacturing index that was released Monday.

As the economy has slumped, so has hiring. Employers added only 18,000 jobs in June, the fewest in nine months. The unemployment rate rose to 9.2 percent, the highest level this year. . . .

UPDATE: Add to that the collapse of stock prices (the DJIA falling by 512 points) and 400,000 filed for jobless benefits.


A case where just the threat of a gun may have saved a life

An interview with GoProud's Jimmy LaSalvia.
Thanks to Nikki Goeser for a heads up on this.

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Government cracking down on Kids' Lemonade Stands

Iain Murray has a useful discussion here.

In the past couple of months, police have put children’s lemonade stands out of business in Texas, Georgia, Wisconsin, Iowa, Pennsylvania, and Maryland. (There’s a great map, with links to the news stories, here.)

The kids have been taught a lesson, but it’s one we should learn, too: You can’t be an entrepreneur in modern-day America without bureaucrats giving you permission in the first place.

The costs of regulation today amount to $10,000 per employee per year for small businesses in the U.S. That’s why the advert where a little girl borrows her father’s phone to help run her lemonade stand and ends up running a multinational just can’t happen. The bureaucrats just wouldn’t let her do it without jumping through the costly bureaucratic hoops first. . . .


A useful discussion of CFL bulbs

Virginia Postrel has a useful piece available here. One useful point is that the bulbs don't seem to last longer than incandescent bulbs.

One serious technophile, University of Tennessee law professor Glenn Reynolds, spent much of 2007 flogging compact fluorescents on his popular Instapundit blog, eventually persuading more than 1,900 readers to swap 19,871 incandescent bulbs for CFLs. To this day, the Instapundit group is by far the largest participant at OneBillionBulbs.com, a bulb-switching campaign organized by the consulting firm Symmetric Technologies. But Reynolds himself has changed his mind.

“I’m deeply, deeply disappointed with CFL bulbs,” he wrote last month on his blog. “I replaced pretty much every regular bulb in the house with CFLs, but they’ve been failing at about the same rate as ordinary long-life bulbs, despite the promises of multiyear service. And I can’t tell any difference in my electric bill. Plus, the Insta-Wife hates the light.” . . .


Fox News Live: Debt Deal: Winners & Losers?

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Appearing on Lars Larson Show at 7:30 PM EDT tonight

Lars will have me on his radio show tonight to discuss my Fox News piece on the Debt Ceiling deal.

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"Only 125 Volts were sold during the month of July."

General Motors apparently can't sell Volts. Here I thought that GM just selling 281 in February was pretty bad. It was good only if you consider that the Nissan sold only 67 Leafs. Now just 125 were sold in July. An amazing number given the huge subsidies given to those who purchase these cars. There are of course other subsidies given to them also.

Sales of the much-hyped Chevy Volt fell to new lows as did GM share price as July auto sales figures came in. Only 125 Volts were sold during the month of July. Recent reports attributed the slump to supply constraints as GM spokeswoman, Michelle Bunker, was quoted as saying that the Volt was "virtually sold out" and only a "few" were available nationwide. I have confirmed that this statement is not entirely truthful and have gotten clarification from GM through Director of Communications, Greg Martin.

A search of cars.com site showed nearly 500 Chevy Volts listed for sale. I had originally assumed that GM dealers were advertising vehicles that were not actually available for sale, since GM has stated that there were only a "few" Volts available. I decided to call a few dealers within 75 miles of my location to determine what the true situation was. I stopped my research after finding that five of the first six dealers I called had Volts in inventory available for immediate sale. Two of the five dealers even had two each in stock. I can now safely assume that GM is, once again, not being entirely honest with its facts. The demand for the Chevy Volt is not as strong as GM would have us believe. . . .

The government gives everyone who buys one of the overpriced Volts or Leafs $7,500. . . .

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Universities in Wisconsin have to let people carry concealed handgun on campus

The entire news article is available here.

Wisconsin’s public universities and colleges have three months to determine how they will welcome the state’s new concealed-carry law, which will allow licensed students to carry guns on campus.

The law signed by Gov. Scott Walker on July 8 takes effect Nov. 1. The UW System has an administrative code that bans dangerous weapons from all campuses, but the state law will nullify it.

UW System spokesman David Giroux said the Board of Regents has not yet developed a new policy guiding chancellors and their handling of the law. Until then, colleges and universities are on their own determining whether to accept concealed carry or ban weapons from some or all buildings.

UW-Whitewater and UW-Rock County are discussing how they will handle firearms on their campuses.

“We are still reviewing the law, and no decisions have been made yet,” said Jeff Angileri, UW-Whitewater spokesman. “We will work with UW System legal staff for guidance on what restrictions can and cannot be placed on firearms on campus.” . . .

The law permits banning of guns from facilities but not campus grounds. That mean licensed holders would be forced to leave them at home or in their vehicles.

It isn’t clear what carriers could do with their guns if they don’t have a secure spot to leave them, but those kinks can be worked out along the way, Nass said.

If it becomes a problem, he said, legislators could amend the bill with a solution.

Another potential issue is posting signs. The law requires that a prohibition include no-firearms signs at every entrance to every facility where guns are not allowed, and the university must pick up the cost.

The alternative is allowing licensed carriers to roam freely throughout campus. It’s too early to tell how many students would take advantage of the new law.

One of the requirements to earn a license is be at least 21 years of age. UW System statistics show that nearly one-third of all students are 19 or younger. . . .

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"Firearms accidents [as a percent of all accidental deaths] are at an all-time low"

Accidental deaths general fall over time. What this is saying is that accidental gun deaths have been falling at a faster rate.

No one blames "our nation as a whole" for the tragic accidents that claim the lives of children, and adults, involving automobiles, swimming pools, poisonings, suffocations and falls, all of which rank far higher than firearms as causes ("Collateral damage," July 25). In fact, less than 1 percent of fatal accidents in the home are the result of firearms, according to the National Safety Council.
Let's not demonize firearms or lawful firearms owners in the search for answers to the unfortunate accidental deaths of three city-area children. Let's instead remind the public that such accidents are rare and can be prevented by taking steps to ensure that guns cannot be accessed by children or other unauthorized persons. Place unloaded guns in locked storage. Store ammunition in a locked location separate from firearms. If a gun is kept in the home for protection, make sure only authorized persons can access it. Quick-access lock boxes are suitable for this. . . .

I don't really think that trying to convince people to lock up there guns makes a lot of sense from a safety campaign because it ignores how much harder all this makes it for people to use guns defensively.

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Only in Sweden?

Only in Sweden would someone worry that they might be breaking the law, contact the authorities to tell them what they are doing, and then get arrested for reporting themselves. This story seems especially strange given that there weren't dangerous levels of radiation involved. From the Associated Press:

. . . The 31-year-old Handl said he had tried for months to set up a nuclear reactor at home and kept a blog about his experiments, describing how he created a small meltdown on his stove.

Only later did he realize it might not be legal and sent a question to Sweden's Radiation Authority, which answered by sending the police.

"I have always been interested in physics and chemistry," Handl said, adding he just wanted to "see if it's possible to split atoms at home."

The police raid took place in late July, but police have refused to comment. If convicted, Handl could face fines or up to two years in prison.

Although he says police didn't detect dangerous levels of radiation in his apartment, he now acknowledges the project wasn't such a good idea. . . .

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Huffington Post apologizes to Andrew Breitbart for accusing him of doctoring video

I guess that we will have to wait and see whether The New Republic, which also made the same claim, will also apologize. From Fox News:

The story was ultimately removed from the website and an editor’s note was posted saying that, “a viewing of the clip in question clearly shows that he did not. We regret the error, have removed the story, and apologize to Mr. Breitbart.”
Some staffers at the website, who were unable to reveal their names for fear of retribution, told FOX411 that they weren’t surprised at the error.
“The goal of the site is aggregation, not news generation. We’re chasing traffic and there isn’t always time to make sure that everything is accurate,” one staffer admitted. "We're really just a factory for links." . . .


The Government Bond Crisis

Moody's warns that there is a significant probability that US bonds will be downgraded.

Moody’s Investors Service and Fitch Ratings affirmed their AAA credit ratings for the U.S. while warning that downgrades were possible if lawmakers fail to enact debt reduction measures and the economy weakens. . . .

Meanwhile Europe is a mess and people don't seem to realize that all this government guarantees only means that countries will spend more money and get in even worse off. From the UK Telegraph:

The three-month euribor/OIS spread, the fear gauge of credit markets, reached the highest level in two years today, jumping 7 basis points to 40 in wild trading. . . . The credit stress was triggered by fresh mayhem in the southern European bond markets and ominously in parts of the eurozone's soft core as well, including Belgium. Spanish yields pushed further into the danger zone to 6.42pc. Italian debt reached a post-EMU high of 6.22pc before falling back slightly on reports of Chinese buying. . . .

Another way of measuring the problem:

On financial markets, the benchmark spread between 10-year Spanish bonds and German Bunds rose to euro lifetime highs above 400 basis points before falling back to around 383 bps. . . .

The Euro Interbank Offered Rate (Euribor) is a daily reference rate based on the averaged interest rates at which banks offer to lend unsecured funds to other banks in the euro wholesale money market (or interbank market).

An overnight indexed swap (OIS) is an interest rate swap where the periodic floating rate of the swap is equal to the geometric average of an overnight index (i.e., a published interest rate) over every day of the payment period.

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Newest Fox News piece: The Debt Deal's Three Biggest Winners and Losers

My newest piece starts this way:

With a debt ceiling agreement finally in place and the Senate on track to approve it today congratulations are being handed out all around. 
Armageddon and catastrophe has supposedly been averted. And politicians are rushing to put the best face on the deal. 

Unfortunately, the new agreement does not accomplish as much as many had hoped, or as much as it should have, in terms of curbing spending and continued deficits. This explains why stock markets continued to fall despite the supposedly "good" news. The reason is because, once again, politicians are continuing to push the problem to the future. 

Here's a look at the winners and losers in the aftermath of the "catastrophe" that's just been averted: 

The Winners:

1. Stimulus Recipients and Big Government: President Obama’s “Stimulus” was supposed to just be temporary. Alas, the debt agreement locks in big government and the extra spending President Obama initiated will continue. 

After government spending soared by 28 percent from 2008 to 2011, the debt deal only starts cutting a meager $22 billion next year. That is an incredibly trivial cut -- just 0.6% of expenditures planned for next year. The cuts agreed on are heavily back-loaded towards the end of the 10 year budgeting cycle, when President Obama and many members of Congress will be out of office. 

Short of a constitutional amendment mandating balanced budgets, . . .

UPDATE: So what happened to the market today? They fell in Asia, Europe, and the US:

The Dow Jones Industrial Average plunged 265.87 points, or 2.19 percent, to end below the psychologically-important 12,000 mark at 11,866.62. The last time the blue-chip index declined for eight-consecutive days was in October 2008.

The S&P 500 plummeted 32.89 points, or 2.56 percent, to close at 1,254.05, slipping into negative territory for the year.

The tech-heavy Nasdaq tumbled 75.37 points, or 2.75 percent, to finish at 2,669.24. The S&P 500 and Nasdaq are both below their 200-day moving averages. . . .

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Copy of Debt Agreement Bill

A copy of the bill is available here. Apparently, there will be only $22 billion in spending cuts compared to the baseline for 2012. That is equivalent to a 0.6% cut in spending. These cuts in the growth of spending are backloaded, which means that there is no guarantee that any president and congress six, seven, eight or more years from now will follow through when they actually have to make the cuts. Might this agreement mean that taxes will be increased? It sure looks that way. In exchange for agreeing to make this level of cuts in spending, Democrats have gotten the chance to pick where most of the cuts will occur. If no agreement is reached for the second stage cuts, almost half the cuts will come out of defense.


Detroit Free Press reporter does some reporting and takes about Violence Policy Center claims on crimes by Concealed Permit Holders

Part 2 of the Detroit Free Press series on Michigan's concealed handgun law after 10 years has just come out and is available here. Dawson Bell has this very useful discussion on the Violence Policy Center's report on concealed handguns supposedly being used to kill people.

Concealed carry licensees "routinely" kill cops, perpetrate mass murders and other gun homicides, writes VPC. The center counted 308 "Private Citizens Killed By Concealed Carry Killer" since 2007. A lot of them -- 78 -- were Michiganders.

A closer look at VPC's data doesn't necessarily confirm a CCW crime nightmare scenario. The overwhelming majority of Michigan victims the center cites (62) were licensees who committed suicide. Michigan's concealed weapons law requires the State Police to report annually on deaths by suicide of license holders.

But the reports contain no information about how the licensee died or whether a firearm was involved.

Several other "victims" in the VPC report appear to have been criminals themselves, shot attempting to rob legally armed citizens. But with 276,000 concealed pistol license holders, even the unscrubbed VPC numbers hardly establish evidence of a crime wave. . . .



Reviewing Michigan's Concealed Handgun Law After 10 years

As I have often written, after a right-to-carry law has been passed people often wonder what all the fuss was all about. Here is an interesting front page article in the Detroit Free Press by Dawson Bell and Gina Damron. People should read the entire article, but here is a portion of it. The quotes on people who thought that there were going to be big problems and then they turned out not be reads as if it could have been part of More Guns, Less Crime.

Ten years after Michigan made it much easier for its citizens to get a license to carry a concealed gun, predictions of widespread lawless behavior and bloodshed have failed to materialize.

Today, nearly 276,000 -- or about four out of every 100 eligible adult Michiganders -- are licensed.

That's more than twice the number predicted when the debate raged over whether Michigan should join the growing ranks of so-called "shall issue" states. . .

Michigan's prosecuting attorneys association led the push against changing the law in 2001. Today, Ionia County Prosecutor Ronald Schafer, president of the group, says it's hard to remember what the fuss was about. . . .

"There haven't been as many incidents as we feared," said Tom Hendrickson, executive director of the Michigan Association of Chiefs of Police, which vigorously opposed the reforms.

"It really hasn't been an issue ... because so many superseding issues came along," he said. "In the total scheme of things, it just faded away." . . .

Wayne County Sheriff Benny Napoleon said he had been opposed to the law and was concerned about flooding the streets with guns. But, he said, "it has turned out not as bad as I suspected that it would." . . .

An interactive version of the map shown below can be obtained here. Wayne county has issued permits to about 4.2 percent of adults. Livingston county is at 5.1 percent. Schoolcraft county in the Northern Peninsula is at 6.3 percent. Montmorency is at 6.94 percent.

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The National Institutes of Health Gives $90 million to China

All these things different spending items add up, but there is a broader issue of whether the government should even be involved in picking what research to subsidize. In addition, if research will pay off, why should the government be involved in the first place? This is from Fox News:

A conservative group is calling on Congress to temporarily suspend funding to the National Institutes of Health (NIH) after releasing a study that found the agency wasted half a billion dollars in taxpayer money on "bizarre projects," and gave more than $90 million to China, America’s largest creditor, over the last decade for other research. . . .
As part of its six-month investigation into NIH’s budget, the coalition discovered that the agency awarded more than $90 million to the Chinese government over the last decade, including $30 million in the last two and half years alone to scientists working at Chinese universities and institutions to research medical issues that affect Chinese citizens.
The coalition has also found that NIH has paid more than half a billion in funding grants to researchers to “conduct bizarre projects such as trying to find out if a mother rat will abandon her babies if given cocaine, and asking individuals to mail in their toenail clippings.”
"As our country heads to fiscal ruin, why are we giving millions in taxpayer dollars to Chinese science – which benefits China and its institutions – when they hold more than $1 trillion in American debt?" . . .