Krugman Gets Results! (But Is Too Modest To Say So)

Paul Krugman bends minds with today's column.  We learn that Stupid Bush and Evil Cheney were opposed to corporate welfare for the mining industry, weak on national security, unreasonably Green, and too cozy with China.  Who knew?

The topic is rare earths and China's virtual monopoly on mining and refining:

Some background: The rare earths are elements whose unique properties play a crucial role in applications ranging from hybrid motors to fiber optics. Until the mid-1980s the United States dominated production, but then China moved in.

“There is oil in the Middle East; there is rare earth in China,” declared Deng Xiaoping, the architect of China’s economic transformation, in 1992. Indeed, China has about a third of the world’s rare earth deposits. This relative abundance, combined with low extraction and processing costs — reflecting both low wages and weak environmental standards — allowed China’s producers to undercut the U.S. industry.

You really have to wonder why nobody raised an alarm while this was happening, if only on national security grounds. But policy makers simply stood by as the U.S. rare earth industry shut down. In at least one case, in 2003 — a time when, if you believed the Bush administration, considerations of national security governed every aspect of U.S. policy — the Chinese literally packed up all the equipment in a U.S. production facility and shipped it to China.

The result was a monopoly position exceeding the wildest dreams of Middle Eastern oil-fueled tyrants.

Hmm - with oil at $80 per barrel the Saudi's daily production is worth about $800 million, or roughly $280 billion per year.  The Times tells us that annual sales of rare earths are about $1.4 billion.  Still important, but maybe not quite the monopoly about which oil-fueled tyrants dream. 

And a bit more on that 2003 closing here; Magnequench took on Chinese investors under Clinton and exited the business in question under Bush, so two Presidents had a chance to intervene.  Nostalgia buffs will enjoy this 2008 Clinton-basher at DKos.  Newsbusters, too.

But let's press on.  Surely Krugman calls for an enraged public to demand government action, right?  Not exactly:

So what are the lessons of the rare earth fracas?

First, and most obviously, the world needs to develop non-Chinese sources of these materials. There are extensive rare earth deposits in the United States and elsewhere. However, developing these deposits and the facilities to process the raw materials will take both time and financial support. So will a prominent alternative: “urban mining,” a k a recycling of rare earths and other materials from used electronic devices.

What's this - Krugman is willing to let market forces sort this out?  OK, that might work - Australia and Canada have projects in development and I think we can be sure of Japanese support.  But Krugman is a progressive and progressives demand government action.

So let's have a Congressional study - hey, Krugman gets results!

And let's have a law exhorting the Department of Defense to rethink this - hey, Krugman has already moved a bill through the House and Senate action is considered likely.

That is a great job by a powerful NY Times columnist.  So why so coy?  Possibly he does not want to flaunt his vast power.  Or maybe the fact that the House and Senate bills were sponsored by Republicans bothers him a bit.

Or maybe the idea of providing corporate welfare to high-polluting mining companies strikes him as something other than the fulfillment of the progressive vision.  Can we have a picture of the mine slated to be reopened in California?  Yes we can:

Hard to believe Cheney opposed that.  Stiil, it's great seeing Krugman on the national security beat.  Over at Heritage folks are worrying but not panicking.

Comments

[Jack is Back!]

Instead of China, perhaps the good Professor can explain Texas. LUN

[Cecil Turner]

Is it too much to ask that rare earth be safe and legal?

Slightly OT, Peter Berkowitz has a nifty OpEd up (Why Liberals Don't Get the Tea Party Movement ):

Highly educated people say the darndest things, these days particularly about the tea party movement. Vast numbers of other highly educated people read and hear these dubious pronouncements, smile knowingly, and nod their heads in agreement. University educations and advanced degrees notwithstanding, they lack a basic understanding of the contours of American constitutional government.

Krugman features prominently (natch).

[MarkO]

Who is this "Krugman" and why do we care?

Was he the one in the "Odd Couple?"

[Captain Hate]

Usually when "Krugan", "results" and "modest" are used in the same sentence, the order is different.

[Rob Crawford]

OT: Obama is scheduled to appear on an episode of "Mythbusters", removing that show from my list of must-sees.

Isn't there ANYPLACE we can go that's safe from his cult of personality? GD, what's next -- the FCC requiring every show close with his picture (one of him haloe'd by the O! logo, no doubt)?

LUN

[Captain Hate]

Not to mention "Krugman"

[Captain Hate]

Rob, does that mean he's providing his transcripts and long-form birth certificate?

[jimmyk]

"they lack a basic understanding of the contours of American constitutional government."

They view the Constitution as a minor stumbling block, a quaint document with some amusing but obsolete notions. Or perhaps like a work of abstract art on which they can project whatever meaning they like.

[narciso]

Does that mean he's a figment of our imagination, like after a bad round of kung pau chicken

[JB]

"Rob, does that mean he's providing his transcripts and long-form birth certificate?"

Perhaps they'll administer an IQ test to put to rest rumors that he's not the historical genius his supporters have claimed...

[Charlie (Colorado)]

Obama is scheduled to appear on an episode of "Mythbusters",

So, they finally found something that Buster just won't do?

what's next -- the FCC requiring every show close with his picture (one of him haloe'd by the O! logo, no doubt)?

Let's not give him any ideas.

[Rob Crawford]

Other shows that will have a surprise appearance by POTUS:

"Dirty Jobs": Mike Rowe's nastiest job yet -- shoveling up all the BS left after a presidential speech!

"Mantracker": Mantracker faces his biggest challenge -- finding a non-socialist, pro-American mentor in the President's past.

"Survivor Man": Les Stroud is joined by the President for a very special task: survival on a golf course.

"Stargate: Universe": Using an alien artifact, POTUS takes over the commander's body and proceeds to royally tick off everyone on board. Series finale.

[Do you gut it?]

Why did the bad round of Kung Fao Chicken cross my mind?
====================

[Take one from Col. A and two from....]

Oops, Kung Pao, or Kung Fowl, or Kung Foul.
=============

[PD]

Who is this "Krugman" and why do we care?

Think "Enron."

[narciso]

Well he is like B'aal the supercilious G'oauld
warlord, btw, they have really jumped the shark on that whole franchise

[Thomas Collins]

Did Krugman clear this column with Tommy "Let's Be More Like China" Freedman?

Next up: a Maureen Dowd column comparing China to a mean girl.

I suppose I should be happy that a NYT op-eder at least considers the impact of mining and manufacturing capabilities on US national security.

[matt]

I believe the episode of Mythbusters referred to is on an incredible new material called Obamium.

It is found in a vacuum. It feeds on its own outgassing. It is extremely lightweight. It mirrors any materials with which it comes in contact reflecting, but not exhibiting those properties. It is usually found in close proximity to horse and cow manure.It is good for nothing.

[Frau Dinkelbrot]

Mythbusters: Why Archimedes and the death ray? I'd like to see Obama and the exploding toilet. Seriously, does anyone believe his being on the show will increase interest in math and science? Pfui!

[Jack is Back!]

matt,

did you know that Obama is a test tube baby? yep, he wasn't worth a f**k back then either.

[JM Hanes]

You guys are teh funny, today!

Mak'ala,ka, JiB.

Texas is just half of what John Steele Gordon calls a "A Natural Experiment in Political Economy." He observes that, "One of the reasons that political science is such an inexact discipline is the difficulty of experimentation." There are exceptions, however. In testing capitalism vs. communism, for example, he points out that the results of two naturally occurring experiments are clear, if you compare North & South Korea or East & West Germany.

For a test of liberal and conservative economic theory, he suggests that California and Texas appear to be a near perfect pairing for examination.

[JM Hanes]

That should have been liberal and conservative **political** theory, which is a broader canvas than "economic" theory as I referred to it above.

[Sue]

Well at least I came out ahead in one comparison. Unless we actually beat those evil Yankees. ::evil laughter::

[Dave (in MA)]

From JiB's link:
"According to the Bureau of Labor Statistics, 214,000 net new jobs were created in the United States from August 2009 to August 2010. Texas created 119,000 jobs during the same period."
The only MSM report of this that I've been able to find is, you guessed it, Fox News. For the rest of the MSM to report this we'd have to have Sarah Palin claim that Texas created 119,001 jobs so they could claim that Sarah Palin lied.

[JM Hanes]

Sue:

I've thanked the Lord for Texas a lot more than once over the past two years!

[JM Hanes]

You're on a roll today, Dave!

[Dave (in MA)]

I hope I don't get butter on my pants.

(bonus points if you know where I stole that from)

[Frau Dinkelbrot]

OT - I received an email from the USPS saying that a package I sent (date given) had an incorrect address and I was to print the label and go to my post office. I had recently sent an overseas package to my nephew with the State Dept. I couldn't open the attachment and went to the post office. They knew of no such procedure. My son thought it was a virus ploy and sure enough, it was. The same thing is being done with FedEx. Too bad the real USPS didn't know about this. My carrier kept waiting for the package to show up. My nephew emailed today that the sweater I knit had arrived in Tblisi just in time for cooler weather.

[glasater]

Frau-
In my spam filter (postini) those types of messages are marked as a virus.
Sure hope your computer didn't acquire one...

[DrJ]

Frau,

There's all sorts of these going around. Originally they were only for putative Banks or PayPal requesting updated information. Attached were .zip files containing viruses.

Then they moved on to FedEx, UPS and USPS. Then they started attaching html to hide the zip file containing the virus. I've even gotten them from the IRS, supposedly.

If you ever have any doubt, look at the headers of the email message and see that they really do trace back to the proper agency or organization. They never do if they are bogus. And in my experience, all of these sorts of email messages are bogus and carry a virus.

[Holly]

Clarice, love the Emory piece. Powerful ending. Sending it to all my lib lawyers. I don't practice, never have, but law school gave me a bunch of idiot friends who are just now beginning to see the light. 21 years of lib hell and for the first time they are voting Rep.I have hope.

[JM Hanes]

I also set the preferences for my email so that it will only load the images in messages when I manually instruct it to do so. Unlike text, images/logos etc. apparently load onto your computer from the emailer's server -- which means he automatically knows he's hit a live address.

[Clarice]

Holly, I think she's such a great observer and writer. I am glad you enjoyed it and delighted to learn your friends are seeing the light, most of my old lib friends are not--or at least not admitting that to me.

[jyty]

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