WSJ Links
Off Duty: --
Review:
This little essay was way too short; I wish she would have written about 5,000 words -- long enough for a
New Yorker magazine article:
novelist Peggy Riley on the Song "Hotel California"
I could be wrong, but there certainly seem to be a lot of new books (this past year) on WWII. Another one is reviewed in today's
Journal. I "give" WWII about five more years; by 2020 it will be as forgotten as the Revolutionary War, the Civil War, and WWI are now forgotten, though the latter war was never remembered by very many Americans from the start. It was a "world war" in name only. It was, when you get right down to it, a European war.
Business & Finance:
A Buffett Fortune Fades in Brooklyn: an interesting human interest story about a hospital closing on Long Island. Many story lines: lawyers, malpractice, and "it certainly gives one pause when considering charitable giving." The 800-lb gorilla in this story was the frivolous malpractice lawyer.
Nymex, Brent crude prices converge.
Domestic oil has for years traded at a discount to global crude, the
result of a combination of booming North American oil production and a
shortage of pipelines that could bring the oil to market. Newly
exploited oil deposits from North Dakota and Canada piled up at storage
depots in the Midwest.
In recent months, however, pipeline and railroad companies have laid
new routes allowing that crude to get to refiners on the Gulf Coast.
Other refineries that had been down for maintenance have recently
resumed operations.
U.S. oil inventories are down 27 million barrels in the last three
weeks, according to the Energy Information Administration. Earlier this
year, supplies were at a record high.
The Front Section:
Fifteen years after autism panic, a plague of measles erupts.
PORT TALBOT, Wales—When the telltale rash appeared behind Aleshia
Jenkins's ears, her grandmother knew exactly what caused it: a decision
she'd made 15 years earlier.
Ms. Jenkins was an infant in 1998, when this region of southwest
Wales was a hotbed of resistance to a vaccine for measles, mumps and
rubella. Many here refused the vaccine for their children after a
British doctor, Andrew Wakefield, suggested it might cause autism and a
local newspaper heavily covered the fears. Resistance continued even
after the autism link was disproved.
The bill has now come due.
A measles outbreak infected 1,219 people in southwest Wales between
November 2012 and early July, compared with 105 cases in all of Wales in
2011.
One of the infected was Ms. Jenkins, whose grandmother, her guardian,
hadn't vaccinated her as a young child. "I was afraid of the autism,"
says the grandmother, Margaret Mugford, 63 years old. "It was in all the
papers and on TV."
Medicine is no longer science; it's social engineering. And more:
U.S. critics, including some who questioned vaccines in general,
continued to campaign against the vaccine. Among them, former Playboy
model and actress Jenny McCarthy, who has been named a co-host of ABC's
"The View," became a leader of the anti-vaccine movement in the U.S.
several years ago when in televised interviews she linked her son's
autism to vaccinations. A publicist for Ms. McCarthy, who wrote the
forward to a 2010 book by Dr. Wakefield, didn't respond to requests for
comment.
That's where Americans get their medical advice: from "The View."
Detroit bankruptcy likely to spark a pension brawl. And it could very well mean the end of municipal bonds as we know them.
Motor City looking for a jump-start.
Still, the response was denial. Anyone who forecast that GM's market
share would fall below 38% was "smoking opium," the company's
then-president declared. It's market share today: 18%.
Denial was the strategy for the city,
as well. Inner-city factories were closing, and new ones were going up
in suburbs and elsewhere far from Detroit, including the South, where
taxes were lower and labor cheaper. People began to follow the jobs;
homes sprang up in former corn fields. The construction of freeways
through Detroit carved up many downtown neighborhoods, making it easier
to hold a job in the city while living in one of the new subdivisions
that sprawled across the northern suburbs.
Detroit's leaders tried to stem the
tide by encouraging development of new downtown monuments. But they
balked at attacking the root causes of the outflow of people and money
to communities with lower taxes, better services and stronger schools.
The city and GM also failed to engage
in the showdowns with their respective unions made necessary by their
reversals of fortune. GM sold cars; Detroit sold the experience of
living in the city. Not enough people were buying either. That meant
money wasn't there to finance generous deals struck with employees in
the fat years for retirees' pensions and health care.
After some bruising skirmishes in the late 1990s, GM's leaders shied
away from a war with the United Auto Workers. Instead, they opted for
labor peace and a bet that the company could sell enough vehicles to
offset noncompetitive factories and retiree legacy costs.
Detroit's leaders also spent the
relatively prosperous 1990s and early 2000s betting that some
development downtown—casinos, new stadiums for the Detroit Lions and
Tigers, some corporate offices enticed by tax breaks—could give the city
breathing room.
Pension payouts may turn on whether state or federal law prevails: laying the groundwork for a federal bailout. A lot of Bakken millionaires will help fund union pensions in Detroit is my hunch.
Op-Ed:
Global Partners (a name familiar to regular readers) is getting stymied in Cambridge, Massachusetts.
The locals love ethanol. But please don't put it on a train and send it through the home of Harvard and MIT.
Detroit's bankruptcy is so 1990s: when we reach the promised land, quantitative easing will be for everybody.
Detroit's filing has a proximate cause. Kevyn Orr, the city's
emergency manager, refused to give the city's bondholders and other
creditors money they wanted. This made them mad.
But Mr. Orr should be mad too. Everybody should be mad. Why should a
bondholder, or a municipal handyman, or a retired cop or fireman go
without money they want and need?
GM had similar problems. It made large pension and health-care
promises to its employees. But President Obama put $50 billion into GM
and now the problem is fixed and the government's stake in GM came out
to $40 billion.
But, you ask, doesn't that leave a $10
billion shortfall for someone to shoulder? That's old-style economics.
Under the new economics, it's possible to have losses without anybody
recognizing losses. This is the lesson taught by Japan's approach to its
banking crisis in the 1990s and Europe's treatment of its current
fiscal woes.
But deeper matters are also at work in Detroit's bankruptcy. "All
along, the state's involvement—including Mr. Snyder's decision to send
in an emergency manager—has carried racial implications," the New York
Times points out, referring to Michigan's white governor Rick Snyder.
And so it goes. Those who are against a federal bailout for Detroit are racists.
