Naughty, but Nice!

By Keith McDowell

Some of us are easily amused. Take, for example, the identification of the Grand Old Party with the color red, as in “Red State.” Hasn’t anyone bothered to inform conservatives – the right wing in particular –  that the color “red” was historically associated in the Twentieth Century  with communism – as in “Red China,” the longstanding demagogic name for Maoist China? How quickly we forget.  But I’ll let you in on a secret, if you promise not to tell. This branding of the GOP is actually a left-wing plot foisted on us by the liberal media brandishing a secret sense of humor. Aw shucks! If only that were really true.

But be that as it may with respect to one’s “redness,” the year 2012 witnessed the trumping of a dialogue on innovation per se by the presidential campaign and the continuing effect of a dysfunctional Congress on the U.S. economy. It was a year full of political theatre peppered by amusing and sometimes tragic sidebars. And not to be outdone by others, I close out this year of personal opining with my own “naughty, but nice” list of quotes and comments about those events that changed how we think about ourselves as individuals and as a nation. My list of awards runs the gamut from A to Z.

Awkward Advice Award: “Take a shot, go for it, take a risk, get the education, borrow money if you have to from your parents, start a business.” Mitt Romney, 27 April

Busy Bee Award: “I have a job to do. … If you think right now I give a damn about presidential politics, then you don’t know me.” Gov. Christie, 30 October.

Cheap Deal Award: “Buy one, get any two free.” Joseph A. Bank commercial.

Déjà vu Award: “You hit a reset button for the fall campaign; everything changes. It’s almost like an Etch A Sketch. You can kind of shake it up and we start all over again.” Eric Fehrnstrom, 21 March.

Entitlement Envy Award: “You can look at history of these things, and Social Security wasn’t devised to be a system that supported you for a 30-year retirement after a 25-year career. … So there will be things that, you know, the retirement age has to be changed, maybe some of the benefits have to be affected, maybe some of the inflation adjustments have to be revised. But in general, entitlements have to be slowed down and contained.” Lloyd Blankfein, Chairman and CEO of Goldman Sachs, 19 November.

Freshman Football Award: And the winner of the Heisman Trophy is: “Johnny Football” Manziel, quarterback of the Texas A&M Aggies. My sons, both Aggies, forced me to include this one. Gig ‘em Aggies.

Golden Fleece Award:  John Boehner and the House GOP on their budget plan that takes from the 99% and gives to the 1%.

Hapless House Award: “I’m just tired of talking about it. I’d rather talk about golf.” Rep. Mack Mulvaney, South Carolina Republican, 19 December.

Instant Inspiration Award: “It’s halftime in America.” Chrysler Super Bowl commercial.

Jumping Jehoshaphat Award: “I hope he fails.” Rush Limbaugh on President Obama, January 2009.

King Karl Award: “I think this is premature.” Karl Rove’s comment on Fox News calling Ohio for Obama on Election Night.

Lots of Love Award: Mitt Romney’s claims of reviewing “binders full of women” as a governor seeking to diversify his Massachusetts administration.

Mixed Message Award: “Is it the Mitt Romney that was on the side of – against the Second Amendment before he was for the Second Amendment: Was it – was before – he was before the social programs from the standpoint of – he was for standing up for Roe v. Wade before he was against first …” Rick Perry, the gift that keeps on giving.

Not Again Award: “Simply scaling back the cliff and extending the political brinksmanship over the debt ceiling would doom the economy to at best slow growth and possibly another recession if policymakers take it down to the wire as they did in summer 2011.” Mark Zandi, Moody Analytics.

Oblivious Oops Award: “I would do it again.” Rick Perry commenting on failed presidential campaign, 18 December.

Piddling Prediction Award: “If the world doesn’t end on December 21^st, 2012, I have a feeling there will be a lot of babies born on September 20^th, 2013.” Anonymous

Quotable Quote Award: “Is capitalism really about the ability of a handful of rich people to manipulate the lives of thousands of other people and walk off with the money, or is that somehow a little bit of a flawed system? … I do draw a distinction between looting a company, leaving behind broken families and broken neighborhoods, and leaving behind a factory that should be there.” Newt Gingrich, 9 January.

Richie Rich Award: “There are 47 percent of the people who will vote for the president no matter what … who are dependent upon government, who believe that they are victims.  … These are people who pay no income tax. … and so my job is not to worry about those people. I’ll never convince them that they should take personal responsibility and care for their lives.” Mitt Romney.

Serial Sequel Award: “I showed extremely poor judgment by engaging in an extramarital affair.” David Petraeus.

Trust Me Award: “I’m an honorary consul general, so I have inviolability.” Jill Kelley, 11 November.

Under Review Award: Republican Minority Leader Mitch McConnell filibustering a vote that he had called for himself. Instant replay officials confirm the call on the field.

Vox Vehicular Award: Lindsay Lohan proves again that driving while sexting is dangerous to one’s image.

Window Washing Award: Tablets shouldn’t bear the Windows name according to Jeffrey Clarke of Dell Computers who suggested that extending the Windows name to tablets was a bridge too far. Did Microsoft purposely confuse consumers into believing that Surface was a PC? Text “A” for yes and” B” for no to Microsoft.

X-Factor Award: “The president’s campaign, if you will, focused on giving targeted groups a big gift. He made a big effort on small things.” Mitt Romney, 14 November.

Y Chromosome Award: “We’re not generating enough angry white guys to stay in business for the long term.” Senator Lindsay Graham, August.

Zany Zinger Award: “Under no circumstances am I going to willingly talk to the police in this country. You can say I’m paranoid about it, but they will kill me, there is no question.” John McAfee on security.

[The image of Santa was copied from the Laytonsville District Volunteer Fire Department.]

Secastration

By Keith McDowell

I confess! I’m guilty! Of what, I’m not exactly sure, but plenty of other people are in the same boat with me. And it’s the same old and now tiring story of a Congress that doesn’t know how to get anything done.  But it comes with a new twist: it’s a story from the 1980s and it presages the completely dysfunctional Congress we now have.

The story begins with the Congressional budgeting process. Doesn’t that language have a familiar “once upon a time” ring to it? In the 1980s, Congress actually managed to pass a yearly budget, but there was a problem. It was rarely done in a timely manner and typically involved so-called “continuing resolutions” that invoked the previous year’s budget in order to get past the beginning of the Federal fiscal year on the first of October.  Important program elements were often not “technically” funded until the early spring of the next calendar year. But therein arose the problem. Program officers at Federal agencies expected work to begin on the first of October for the program elements that they assumed would be funded for that fiscal year, even though the funding wasn’t “technically” appropriated by Congress as of the first of October.

What would you have done if you were a manager like me in the 1980s at Los Alamos National Laboratory (LANL), especially if you knew that “technically” it was “illegal” for you to expend funds from one program account on another program? Of course, program schedules had to be maintained since research cannot be done on the quick time, agency program managers had to be satisfied with progress, and salaries had to be paid. It would have made no sense whatsoever to put employees to work only on the funded programs “technically” rolled over from the previous fiscal year.

I can tell you what all the managers did at LANL and across the spectrum of national laboratories. We ignored the “technicalities” and simply moved forward with our programmatic efforts while hoping to balance the books in the end and avoid a bed and jail cell at the Leavenworth prison. Whatever one’s scruples might be about the ethically and morally right choice when faced with such a situation, it was really the only choice available to management. Fortunately, national laboratories did not keep time cards like most of the defense industry contractors, so I suppose that we were “technically” legal in what we did. But it was a helluva way to run things.

Fast forward to the present day and guess what? Nothing has changed.  In fact, it’s even worst. Now we are faced with “sequestration” as part of the fiscal cliff debate. What the heck is that, you ask? Here’s how the dictionary defines the verb “sequester.” It is an action to “remove, set apart, segregate, take possession of, confiscate, or cause to withdraw into seclusion.” Hmm, does seclusion mean that defense dollars will be taken “off budget” and hidden by smoke and mirrors from the public? Inquiring minds want to know.

Seriously folks, what “sequestration” actually means to the man on the street including those poor managers at the national laboratories is that members of Congress want to take back that which they’ve already “technically” granted or built into the current and future fiscal budgets. Yikes, I’m glad I’m now retired and no longer eligible for a bed at Leavenworth.

But “sequestration” doesn’t just affect national laboratories or defense contractors. It affects the entire innovation ecosystem of America including a severe hit on basic research at our universities, the wellspring from which innovations emerge. Think of it in terms of the following metaphor. Basic discoveries are like sperm. They float around in search of an egg to fertilize. Only a few achieve successful conception of the embryo of an idea that grows into an innovation that is born as a commercial product in the marketplace. If one neuters the process, you get nothing in return. With sequestration, we turn America into a eunuch state unable to display leadership in the global Innovation Race. It’s a form of “self castration” or better said, “secastration” – to invent a new and more appropriate word to describe what’s going on.

Secastration, like all forms of self-indulgence, is almost certain to make one blind to its outcomes. And how about all those mythical warts that one gets from such activities?

But let’s turn to the hard numbers behind the rhetoric. The 2011 Budget Control Act is the vehicle through which sequestration will occur without a resolution of the fiscal cliff. According to an email that I received from the American Physical Society, “the Department of Energy Office of Science would lose $400 million; NSF $586 million; NASA Science $417 million; and NIH, $2.52 billion. It would mean staff furloughs, a significant reduction in operating time for user facilities, and a reduction in new NSF grants by as much as one-third.” I can tell you that researchers will spend an inordinate amount of time writing grants in the hope of keeping their operations alive. Some argue that progress in innovation will be set back by over a decade.

And what’s even more troubling is that “sequestration” will occur on top of the positive impact of stimulus funding from the American Recovery and Reinvestment Act (ARRA) of 2009 – funding that was temporary and is scheduled to disappear. Although data related to ARRA funding is hard to extract at this early stage – there is always a several year delay in processing such data, we know that universities spent $54.9 billion on R&D in 2009 and $65.1 billion in 2011, up 6.3% from 2010. These significant increases reflect the slug of one-time ARRA stimulus funding that is currently being spent. What will happen when that goes away over the next year or two when added to sequestration?

Steve Fuller in an important report entitled The Economic Impact of the Budget Control Act of 2011 on DOD & non-DOD Agencies projects that sequestration will result in the direct loss of 31,000 jobs out of the 1,082,370 STEM workforce in America. Based on the ARRA impact and my own understanding of the situation, I suspect the real number will be larger.

It’s “secastration,” plain and simple. It’s cutting off and emasculating America’s ability to innovate by reducing funding in our R&D sector. It’s “balancing the budget” of a much poorer America in the future. And it’s self-inflicted. I choose procreation over castration. How about you?

Note: The image of the castration tool was copied from valleyvet.com and is a product of Syrvet Inc.

Shake, Rattle, and Roll

By Keith McDowell

“What it was, was an earthquake,” to paraphrase a famous 1950s comedy routine about football by the incomparable Andy Griffith. But there was nothing comedic about “the big one” that occurred on 6 April 2009 in L’Aquila, Italy that killed over 300 people. Sadly, the aftershocks of such a major earthquake are never pretty, whether it’s the massive destruction wrought on the infrastructure – the Fukushima nuclear power plant debacle from the 2011 Tohoku quake in Japan being the most notable, the death of innocent people, or the privations of the survivors. But who would have thought that scientists would be in danger from the aftershocks of an earthquake? Yet, such was the case in Italy.

On 22 October 2012 in an Italian courtroom, seven scientists and experts were convicted of manslaughter for providing “inexact, incomplete, and contradictory information” prior to the L’Aquila earthquake. The stunning decision was described by Dan Murphy in The Christian Science Monitor as “a triumph of scientific illiteracy.” Indeed! If not for the truly tragic dimensions of the L’Aquila earthquake, the soap opera in that Italian courtroom would be comparable to the 1633 Catholic inquisition in Rome against Galileo Galilei.

Have we as a world society learned nothing from the advance of knowledge through rational and scientific reasoning? Is civilization doomed to make decisions based on religious dogma, mythology, personal whims, demagoguery, and counterfactual ideas? I suppose one should take solace in the fact that such nonsensical behavior is not limited to America as proven in that Italian courtroom.

So, what are the facts when it comes to earthquake prediction? It’s simple. No one can predict the precise time and location of an earthquake! Yes, we’ve learned a great deal about what causes earthquakes and their behavior. We know how to build structures that can withstand an earthquake, but prediction? Emphatically, no!

In fact, there are many scientists who believe that we will never be able to “predict” the occurrence of an earthquake. And it all begins with the difference between “predicting” and “forecasting.” Do you remember those old jokes about your weatherman? “If there is a 50-50 chance that a forecast will go wrong, 9 times out of 10 it will.”

The story of modeling the weather goes back to the 1960s when Dr. Edward Lorentz introduced “chaos theory” to the world in 1963 and later “the butterfly effect” in 1969. Sensitivity to initial conditions, as “the butterfly effect” is known to scientists, states that a butterfly deciding to flap its wings in China could subsequently lead to a tornado in Kansas. In other words, incredibly small changes at the beginning of a process can lead to radically different end results. Thus, as a practical matter, one cannot precisely predict the time and location of a weather event. The same is true for earthquakes.

But whether it’s the severity of weather events or the magnitude of earthquakes, scientists have developed and are continuing to improve mathematical models that describe the distribution of such events and thereby our ability to “forecast.” What does forecast mean? It means that if we take a long enough span of time that includes a significant sample size of “events,” then we know that those events will fall on the established probability distribution. Thus, we can “forecast” that there is a 10% probability (or whatever the actual percentage is) that an earthquake of magnitude 7.0 will occur in Los Angeles in this century, but cannot “predict” exactly when and where it will occur.

Folks, that’s the truth of the matter. And convicting scientists for their inability to “predict” an earthquake or meteorological event is dumb and dumber – or better said: scientific illiteracy.

But the story doesn’t end with natural events driven by Mother Nature. How about the economy and financial systems? Yep, scientists, mathematicians, and economists have been at work in that sphere as well. Believe it or not, there is a field of study known as “econophysics” or the “physics of finance.” The University of Houston Department of Physics even has a subdivision devoted to such work. Quoting from their webpage, econophysics is “the study of dynamical behavior of financial and economic markets” using the “vast amount of market data” that “has become available allowing empirical studies of market behavior to be performed.”

And exactly what have econophysicists learned? Probably the most important fact is that we now have a very clear picture of the probability distribution for excursions or fluctuations in markets. Technically, it’s known as a “fat tail” distribution where the probability for a large fluctuation decays as the fourth power of the size of the fluctuation. In simple terms, large fluctuations are much more probable than one might have thought. Does anyone remember 2009?

Evidence suggests that one can improve incrementally the market performance of a portfolio by making use of our enhanced understanding of markets as a nonlinear dynamical system. Talk about the possibility for innovation and entrepreneurship! Perhaps you should call your broker or financial planner and see if they are up-to-speed on “fat tail” distributions and econophysics. It’s for certain that Congress is not.

And that brings us to the “fiscal cliff” debate and the truly ridiculous behavior of many in Congress to ignore some basic elements of truth from economic data analysis – especially those who hold to the tea party platform. Like many people, I obtained a copy of Taxes and the Economy: An Economic Analysis of the Top Tax Rates Since 1945, the report from the Congressional Research Service by Thomas L. Hungerford dated 14 September 2012. Here is what Hungerford said in his concluding remarks:

The results of the analysis suggest that changes over the past 65 years in the top marginal tax rate and the top capital gains tax rate do not appear correlated with economic growth. The reduction in the top tax rates appears to be uncorrelated with saving, investment, and productivity growth. The top tax rates appear to have little or no relation to the size of the economic pie. However, the top tax rate reductions appear to be associated with the increasing concentration of income at the top of the income distribution.

Obama is right; the GOP is wrong! Taxing the top 2% will help reduce the deficit but not hurt the recovery. Do we as a nation really want to follow in the footsteps of those jurists in Italy who practiced scientific illiteracy – or in our case, economic illiteracy? As Paul Krugman pointed out in an opinion piece in support of Obama’s position, it’s simple economic math. The cuts in spending laid out by the GOP such as raising the Medicare age don’t add up. And as to closing tax loopholes, do we really want to eliminate mortgage and charitable deductions, two of the largest components of our tax deduction system? For those who sincerely want to understand fully the dimensions of the economic mess we are in and what to do about it, read the book Beyond Outrage by Robert Reich.

And don’t forget, the “fiscal cliff” is not just about raising again the tax rate for those making more than $250,000. It’s about budget sequestration and the evisceration of scientific research in America. It’s about killing the goose that lays the golden egg of innovation, our passport to global competition and economic prosperity.

As a nation, we must govern ourselves in a balanced manner consistent with our Constitution using sensible rules of engagement and a decision process based on verifiable and known information. We cannot tolerate any other approach.

It’s time to shake, rattle, and roll the members of Congress and tell them to get on with the business of governing America.