Friday, May 24, 2002
I have decided that ducks are dumber than I thought. We have a couple of trinkets floating in the pond, including an old duck decoy whose origin eludes me. I can understand how a duck might be tricked by a decoy at first. But this duck first sat for 30 minutes by the pond, then jumped in and swam around, and then -- still unaware that the decoy was not real -- tried to...um...mount it. After about half an hour of this, the duck flew off.
This afternoon, a fox wandered into the backyard to sip from the brook! In Toronto, a few blocks from shops and offices! Oh, and a raccoon seems to have ensconced itself inside our outdoor storage area under the house. And to top it off, after all this the duck came back this evening for a brief visit.
Remember Dick Cheney saying: ". . . do all that we can to ensure that . . . 9/11 never happens again." Well, I'm saying he was lying. They have chosen not to do all they can. This may sound like my paranoid moment. But listen to the argument.
U.S. policies since Sept. 11 have been ineffective or counterproductive at preventing future terror. The bombing of Afghanistan did not destroy al-Qaeda the way an emphasis on black ops, bribery, assassination etc., might have; but it added fuel to anti-Americanism, as did the U.S. role in Pakistan. Washington chose not to impose a settlement in the Mideast, but instead to back an Israeli escalation, thus inflaming the single greatest grievance in the Arab and Islamic worlds.
Okay, so the idea about "imposing a settlement" on the Mideast -- which is Salutin-speak for having the U.S. require Israel to pull back to the pre-1967 boundaries without any agreement from the Palestinians to, say, agree to stop terror attacks or recognize Israel or agree to stop demanding total repatriation of all Palestinian refugees to their 1948 homes -- isn't new or startling at all. It's one of Mr. S's basic arguments -- because immediately after this, Arafat et al. will be happy and will have no incentive to keep bombing Israeli civilians, and all will be bunnies and elves and dancing.
But apparently Salutin is in favor of covert operations involving assassinations and other fiendish operations! This is news to me, since in the past Salutin has widely criticized the U.S.'s involvement in anything remotely like this. If Bush were to go to Congress and ask for permission to use such means of retaliation, Salutin would be the first to condemn him, arguing ponderously that part of being a country under a rule of law is to resist such barbaric extralegal impulses, etc. etc. But here, since he can use this as a crutch to support his dubious arguments, Salutin is willing to propose such operations in a way that sure doesn't sound like condemnation of them. He then goes on to argue that not doing such black ops is due to realpolitik! Way to go, Mr. Salutin!
"Gentlemen, we have a problem. Piracy is cutting heavily into our sales. Well, that or the sucky music we've been putting out. But I blame piracy. Anyway, people are moving away from music CD's because there are too many inexpensive alternatives. People are watching more DVD's, burning their own mix CD's from their music libraries, listening to satellite radio in their cars, internet radio at home, and digital TV stations have free music on them. Given all of these competitive pressures, what's our next move?"
"Well Chief, I say we raise prices, and shorten the content so that artists can crank out more records. The combination of higher prices and less content is a winner!"
As it happens, raising prices in response to falling demand could be exactly the right response, depending on which consumers stop buying CDs and which consumers continue to do so! This was one of the cool, counterintuitive examples that I remember from my Microeconomics class at a well-known MBA program in Cambridge/Boston. (No, not that one. The other one.)
Let's say that some consumers choose to spend more of their money on DVD movies, or video games, or cellphones rather than on CDs. The demand for CDs will fall. This usually means that the price for CDs should fall, thanks to the magic of supply and demand curves. BUT...if the remaining demand for CDs is less price-elastic -- that is, the remaining consumers of CDs are less likely to respond to price changes by making big changes in their consumption of CDs -- then profit-maximizing CD producers should actually raise prices. (At the extreme, if the remaining demand is entirely price inelastic, then the CD makers should raise their prices to equal the entire disposable income of the consumers, since these rabid CD consumers will continue to buy CDs anyway.) So if the change in price elasticity is big enough, the price increase can outweigh the downward price pressure associated with the decline in overall demand. Cool, huh!
Of course, this may have absolutely no bearing on real life today, but that's never deterred economists before.