Update no.459

Update from the Heartland

No.459

27.9.10 – 3.10.10

Blog version: http://heartlandupdate.blogspot.com/

To all,
The follow-up news items:
-- Just in case anyone may be interested in my opinion on the topic . . . the DC Circuit’s ruling in Sherley v. Sebelius [DC CCA no. 10-5287 (2010)] [454, 456] – the embryonic stem cell funding injunction case – still has not been posted. I eagerly anticipate learning the appeals court reasoning.

I entered the 2nd annual Washington Post Next Great American Pundit contest. I will share my entry once I am passed or rejected at the first gate.

History is such a magnificent process. Eighty-five years ago, the world was at war, centered predominately on France and Belgium. Five very bloody years later, an armistice was reached as the German government and political system collapsed. The Allies imposed a treaty signed in the Hall of Mirrors at Versailles Palace that contained destructive reparations intended to punish Germany for the war. The treaty carved out chunks of territory, prohibited Germany from possessing military forces to defend itself, and demanded 96,000 tons of gold plus materiel like coal, horses and cows. The treaty became the primary catalyst for the rise of German fascism and for the subsequent even more destructive war. As Germany celebrates the 20th anniversary of reunification, the following article highlighted an important, over-looked part of history.
“Legacy of Versailles – Germany Closes Book on World War I With Final Reparations Payment”
by David Crossland
Der Spiegel
Published: 09/28/2010
http://www.spiegel.de/international/germany/0,1518,720156,00.html#ref=nlint
Germany made the last reparations payment from the Treaty of Versailles – an unsung historic moment worth noting. The books can finally be closed on the War to End All Wars. Fortunately, my parents’ generation stood the mark when called upon, and the leaders of my grandparents’ generation learned the lessons of the Versailles Treaty; they chose to rebuild Germany rather than destroy the nation after the Nazi devastation. This weekend is as much a celebration of the wisdom of reconstruction as it is the reunification of Germany after it was divided in occupation.

The New York Times reported that Federal law enforcement and Intelligence Community (IC) officials are seeking new regulations to require all Internet communications service providers to be technically capable of complying, if served with a wiretap order. The USG wants to be able to intercept and unscramble encrypted messages involving BlackBerry, social networking Web sites like Facebook, and software that allows direct “peer to peer” messaging like Skype. Herein lies the conflict challenge between freedom and security.

With all the gurgling and brouhaha over Bob Woodward’s new book, an independent, sober assessment should be beneficial.
“Pakistan and the U.S. Exit From Afghanistan”
by George Friedman
Strategic Forecasting, Inc.
Published: September 28, 2010 | 0855 GMT
http://www.stratfor.com/weekly/20100927_pakistan_and_us_exit_afghanistan?utm_source=GWeekly&utm_medium=email&utm_campaign=100928&utm_content=readmore&elq=b11411c0d2d54713a9632d97889ad840

As many say, history repeats itself – an odd euphemism.
“The War on Terror and the Revolt of the Generals – The strain of a prolonged conflict has led some military officers to believe they're better than the society they're serving”
by Mackubin Owens
Wall Street Journal
Published: October 1, 2010
http://online.wsj.com/article/SB10001424052748704654004575517791390249112.html?mod=djemEditorialPage_h
This is déjà vu from my generation. I remember the campaign for the 1980 presidential election and the overt political advocacy by more than a few flag officers. This is not a new phenomenon [227, 229]. This is not Seven Days in May [182, 302].

The State Department issued a travel alert on Sunday, urging Americans traveling to Europe to be vigilant about possible terrorist attacks. The IC is assessing intelligence about possible plots originating in Pakistan and North Africa aimed at Britain, France and Germany. And so it goes.

I read court pronouncements out of curiosity . . . to understand where we have come from and where we are going. As is often the case, we are also treated to a journey back into history. This week’s case is Communist Party of United States v. Subversive Activities Control Board [367 U.S. 1 (1961)]. The case spanned nearly a decade of fits and starts within the judicial process. The law at issue was the Subversive Activities Control Act of 1950, which was actually Title I of the Internal Security Act of 1950 [PL 81-831, 64 Stat. 987; 50 U.S.C. 781]. The law required the officers and directors of the Communist Party of the United States to register with the Justice Department, which in turn subjected them to prosecution under a handful of laws enacted between 1938 and 1954. In a narrow decision, the Court affirmed the constitutionality of the law. As could be expected, the dissent drew bright illumination on and comparison to the infamous Alien and Sedition Acts of 1798 [1 Stat. 570; 1 Stat. 577; and 1 Stat. 596] and the British law of 1593 [35 Elizabeth, cc. I and II], entitled “An Act to retain the Queen's Majesty's Subjects in their due Obedience” and “An Act for Restraining Popish Recusants to some certain Places of Abode.” These laws have one thing in common; they focus the instruments of State on those who are perceived as enemies of the State, which brings us to the First Amendment’s freedoms of assembly, speech and redress – one of our greatest strengths and concomitant vulnerabilities (some might even say weaknesses). Associate Justice Felix Frankfurter writing for the Court, “Individual liberties fundamental to American institutions are not to be destroyed under pretext of preserving those institutions, even from the gravest external dangers. But where the problems of accommodating the exigencies of self-preservation and the values of liberty are as complex and intricate as they are in the situation described in the findings of §2 of the Subversive Activities Control Act - when existing government is menaced by a world-wide integrated movement which employs every combination of possible means, peaceful and violent, domestic and foreign, overt and clandestine, to destroy the government itself - the legislative judgment as to how that threat may best be met consistently with the safeguarding of personal freedom is not to be set aside merely because the judgment of judges would, in the first instance, have chosen other methods.” Herein lies the mortal challenge of every free society – freedom of its citizens versus subversion from within by a force external to the nation-state. In 1593, it was the Roman Catholic Church. In 1798, it was the Jacobin French. In 1950, it was the Communist International of Stalin’s Soviet Union. Today, it is al-Qaeda. The truly striking aspect of this particular case was the dissent – four justices – who refused to acknowledge the threat as they opined about the idyllic, unhampered, 1st Amendment freedom of speech and assembly. When does the threat from external or even internal sources overcome those precious freedoms? My tolerance level is much higher for internal versus external influences. Unfortunately, even in this case, the Court fails to reach even the internal threshold.

News from the economic front:
-- The Federal Reserve policy committee indicated it was prepared to take new steps, if needed, to avoid a second-dip recession or faltering recovery. Hey, at least they are prepared.
-- Census Bureau statistics indicated household incomes decreased for the second year in a row in 2009, as fewer families earned over $100,000 a year. Further, the ranks of the poor rose as well.
-- The Commerce Department reported U.S. consumer spending rose just 0.1% in August from July, and 1.4% year-over-year, below the Fed’s informal target of between 1.5% and 2.0%.
-- According to a joint report from the Securities and Exchange Commission and the Commodity Futures Trading Commission, the May 6 “flash crash” [438] was caused by a trading algorithm on a single, large trader’s computer, which directed the sale of US$4.1B in securities. The trade cascaded collateral trades in an already unstable market. The report found that the trades were initially absorbed by high-frequency traders and others in the market, but soon liquidity dried up for that contract and elsewhere.

Comments and contributions from Update no.458:
“Good work with the rant on the blue noses....I agree totally. Have been secretly pleased to see that the great cigarette tax in New York has resulted in a modern bootlegging crime spree. I guess we got tired of burning witches and had to have some other diversion....”
My reply:
One of these days we will grow up and re-learn the lesson of the 18th Amendment, but we have a long way to go. I could think of a lot of other diversions without the moral projectionists’ attempts to live everyone else’s lives for them.

My very best wishes to all. Take care of yourselves and each other.
Cheers,
Cap :-)