Jinn of Current Events

NYT: Deutsche Telekom said today that it had lost 24.6 billion euros ($27.1 billion) in 2002, the biggest annual loss in European corporate history. Last week, Vivendi and France Télécom both posted annual losses in excess of 20 billion euros. There is no rational way a company can lose that much money in one year, without early warning signals and time enough to avoid or at a minimum reduce the magnitude of the losses. These losses are not due to capital investment with corresponding profits in the future. They represent a complete misallocation (and waste) of capital and labour. European economic progress has been and continues to be sharply reduced by such waste. 

1441 required immediate, unconditional, and active disarmament and cooperation on the part of Iraq. If words have meaning, complaining about these inspection flights and threatening the U-2 planes is a further, direct, material breach. The game is over. Let's roll! 

Vladimir Bukovsky and Elena Bonner have written an open letter to President Bush: Before the bombs begin to fall, leaving us no time for calm reflections, it seems only natural to step back and try to assess the overall picture as it develops. No, we are not joining those who seek to dissuade you from taking a military action in Iraq. On the contrary, we think that this action is long overdue, and that Iraqi people were left to suffer from the evil regime of Saddam Hussein for too long. Neither can we share the pacifist sentiments expressed recently by many millions of marchers. Our own experience under no less evil regime of the Soviet Union has taught us that freedom is one of a few things in this world worthy of fighting and dying for. And the sooner we do it the better because such regimes, as history proved time and again, leave us no option but to confront them and to destroy them for they, by their very nature, are both oppressive internally and aggressive externally. 

On Monday all forces poised to attack Iraq switched to Zulu time, an adjustment that usually precedes military operations and keeps everyone in synch with Universal Time Coordinated (UTC). 

NYT: The White House declared today that the United Nations Security Council's failure to act against Iraq would not only compound mistakes it made in the 1990's but would also encourage North Korea and Iran as they race to build nuclear arsenals. Further, Ari Fleischer, President Bush's press secretary, openly described the severe breach between the White House and the United Nations: If the United Nations fails to act, that means the United Nations will not be the international body that disarms Saddam Hussein. Another international body will disarm Saddam Hussein. 

James Taranto: There's certainly an argument to be made that the U.N., as presently constituted, is worse than useless. For one thing, despite the U.N.'s professed aversion to war, what it really seems to object to is victory. In the U.N.'s 58-year history, two wars have been waged under Security Council auspices: Korea and the Gulf War. Both ended with less than total victories, leaving in power two of the worst tyrannies on earth, which are now two of the world's most dangerous rogue states. (If the U.N. instead of the Allies had fought World War II, Germany might still be ruled by Nazis instead of weasels.) U.N. peacekeeping operations, too, are at best a mixed bag, with a record of failing to prevent such horrors as the Srebrenica massacre and the Rwanda genocide. 

How is the US economy doing? The year 2002 saw a lot of growth, much more than 2001. Recently released revised measurements of Q4 2002 show much better results than had initially been reported. The Economic Research group of the Federal Reserve Bank of St. Louis publishes useful information. Here is a highlight from the weekly US Financial Data (2003-Mar-06 issue): real GDP increased at an annual rate of 1.4 percent for the fourth quarter of 2002, 0.7 percentage points above the advance estimate released in January. Real GDP grew 2.9 percent in 2002 (fourth quarter to fourth quarter), compared with an increase of 0.1 percent in 2001. Well, that's very positive news. What about productivity? Output per hour (labor productivity) in the nonfarm business sector grew at a revised 0.8 percent annual rate during the fourth quarter of 2002. The previous estimate indicated productivity declining at a 0.2 percent rate. ... During 2002 (fourth quarter to fourth quarter), labor productivity rose 4.1 percent while unit labor costs rose 0.1 percent. Well, that's great.

To put things in perspective, a 4% annual productivity increase over one generation would lead to more than a doubling of labor productivity over that period. Annual GDP growth of 3% would double GDP somewhat more slowly, in 24 years instead of 18. The US continues to create wealth and increase productivity on a gigantic scale, with each new generation enjoying much higher standards of living than the previous one. Will this be reported in the media?