Some links and opinions

First, expect my entry on intelligent design by Tuesday. Second, expect a piece on church and state relations soon. I have been reading Noah Feldman's excellent book on the topic, Divided by God. I should be done by the end of this week. On top of that, Richard Posner and Gary Becker both weighed in on the debate this week, in their respective unique fashions.

Anyways, to hold everyone over, here are some interesting things to check out:

Last week an arbitration panel ruled that United States lumber tariffs against Canadian lumber violated NAFTA. The Wall Street Journal takes it from here:

The American Homeowners Alliance estimates that rescinding the tariffs will reduce the average construction cost of a new home by about $1,000 and make about 300,000 more moderate-income Americans eligible for mortgages.

Instead of hailing the move as a welcome step toward more affordable housing, the Bush administration insists that it won't lift the tariffs, which can reach as high as 27%. It further plans to engage in more stalling tactics by appealing the decision to the World Trade Organization. The Office of the U.S. Trade Representative declared that the ruling "will have no impact on antidumping and countervailing duty orders."

....

Under Nafta rules, the $5 billion must be returned to the Canadian companies that were forced to pay the illegal tariffs. The administration says it won't comply, and the Canadian government is now threatening retaliatory trade sanctions on U.S. agricultural products. These are the first grenade launches in a potentially ugly trade war -- precisely the sort of thing Nafta was enacted to prevent. We can hardly blame Ottawa for its loss of patience. This is the fourth time either the Nafta referees or the WTO arbitrators have rejected the Bush administration's claims of unfair competition.

Making matters worse is that the administration's proposed remedy for the lumber dispute is a complete economic loser for Americans. The U.S. is demanding that Ottawa impose a tax on the softwood lumber it exports to the U.S. so that prices here rise. This whole inane scheme may very well lead to a net reduction in employment in the U.S. because for every lumber and sawmill job there are about 25 Americans working in industries that depend on low-priced Canadian lumber as an input.

Just ridiculous. So much for any party being free-trade. Gar.


In the irony department, it turns out that Iraqi insurgents may be producing their own WMDs. The Washington Post reports:

U.S. troops raiding a warehouse in the northern city of Mosul uncovered a suspected chemical weapons factory containing 1,500 gallons of chemicals believed destined for attacks on U.S. and Iraqi forces and civilians, military officials said Saturday.

Monday's early morning raid found 11 precursor agents, "some of them quite dangerous by themselves," a military spokesman, Lt. Col. Steven A. Boylan, said in Baghdad.

Combined, the chemicals would yield an agent capable of "lingering hazards" for those exposed to it, Boylan said. The likely targets would have been "coalition and Iraqi security forces, and Iraqi civilians," partly because the chemicals would be difficult to keep from spreading over a wide area, he said.

Boylan said the suspected lab was new, dating from some time after the U.S.-led invasion of Iraq in 2003. The Bush administration cited evidence that Saddam Hussein's government was manufacturing weapons of mass destruction as the main justification for the invasion. No such weapons or factories were found.

Well that would be pretty hilarious if the incorrect justification for going to war ended up only spawning the rationale. Oh well.


Last, William Buckley had a terrible article in the National Review. He paraphrases the doomsday gas-crisis scenario from Raymond Learsy's Over a Barrel:

But here is what we might be facing if oil rose to $100 per barrel.

I quote from the author. Commuters suddenly forced to pay $2.50 or more for a gallon of gas began to brown-bag their lunches, inching away from restaurants and sandwich shops. Americans who could still afford a vacation went on shorter trips, putting a major dent in the tourist industry. Trucking companies hauling everything from wines and spirits to furniture to automobile parts imposed a hefty surcharge on shippers, who passed it on to their customers, who then passed it further down the line to the retail buyer if they could.

The crunch forced many independent truckers to sell their rigs, playing havoc with both cross-country and local shipping. Higher fuel costs sent the U.S. Postal Service deeper into the red and threatened the survival of rival package shippers FedEx and UPS. With the break-even point for airlines a distant memory at $31 a barrel and carriers already operating with skeleton staffs, sharp fare boosts were the only option. Traffic spiraled into a tailspin, and one airline after another declared bankruptcy.

But of course, oil is vital to everything from plastic picnic forks to printer’s ink to asphalt. Manufacturers raised prices across the board, and potholes went unfilled in city streets around the nation. At first, municipal and factory employees lost overtime, then they were laid off or fired outright. Foodstuffs of every kind — from beef in the butcher case to fresh fruits and vegetables in the produce aisle to milk and cheese in the dairy section — reflected the higher costs incurred by growers and shoppers.

Runaway prices on just about everything took the Federal Reserve Board by surprise. Determined to keep interest rates low and dulled by their own assurances that inflation was somnolent, the Federal Reserve’s governors were ill-prepared for the economic crisis. The Fed belatedly boosted interest rates a full 2 percentage points. The heretofore unheard-of move jammed on the economic brakes so swiftly and so sharply that you could almost smell the stink of burning rubber. Higher mortgage rates stopped would-be home buyers dead in their tracks and cast a pall over the building industry. The real-estate market crashed almost overnight, wiping out billions of dollars of paper profits and putting holders of adjustable-rate mortgages and home-equity loans in peril. Foreclosures and tax-default auctions became common, consumer spending dried up, and soon the entire world was in a recession.

This is just ridiculous because the demand for oil while very inelastic in the short-run, is not so for the long-term. This is because there are ways to correct for increases in oil prices. There are more fuel efficient cars. There is public transportation. There is car pooling. There is coal and nuclear power (which are making comebacks in China and the United States, respectively, as the price of oil rises). People will still buy lunches, homes, etc. Sure the cost of transporting goods will increase, as will the cost of heating a home (people can always buy smaller homes or heat fewer rooms in their McMansion), but it seems that Mr. Buckley feels there are no ways for the market to intervene and stop the highly unlikely downward spiral that Mr. Learsey is prognosticating. Obviously, we'll have to wait and see.

Until tommorow,

Mr. Alec