Thursday, January 12, 2012

Can the US and EU really tighten the screws on Iran?

After nearly a decade of hearing the same back and forth between Iran and the West, the situation has heated up as the US and the EU look to clamp down on Iran's oil revenue. Tough talk from the Bush Administration for years amounted to sanctions that Iran was largely able to ignore; the routine newsroom joke during that period was that Washington was blocking imports of Iranian dates, prunes and carpets. This time it's for real, this time it's oil.

All over the newswires I read that Iran is in panic, people are lining up to buy dollars, and the currency is collapsing with the threat of the new sanctions. But I'm still confused at how the mechanics of this would work in the long run, because not everybody is on board. China, which is a major buyer of Iranian oil, has already blown off the sanctions. Russia, which is a major oil exporter and therefore not a buyer of Iran's crude, is using its diplomatic clout to warn against the sanctions and is now raising the specter of potential war by Western powers.

The issue here is that oil is a global market. If one country, or group of countries, decides not to buy from a particular seller, that simply rearranges the way the oil is traded but does not affect either the production or the consumption -- and therefore the supply and demand -- of the product in question. This came up over and over when Venezuela's President Hugo Chavez repeatedly threatened over the years to cut off oil exports to the United States. His detractors pointed out that that would just mean Venezuelan oil would go to another country, displacing the oil that country was buying from Saudia Arabia, Indonesia, or Libya, which would in turn end up in the United States.

The same thing strikes me as happening here. The US, EU and Japan all band together and put their foot down about Iranian oil, and start to buy it from somewhere else. OK, that in the short term will make the price of oil go up because of the uncertainties involved, bringing speculators into the mix, and at least temporarily roiling the markets. The logical next step would be for China to simply increase its purchases, some of which it can do through barter exchange (oil for ipods?) and absorb the slack. If the fundamentals remain the same, the prices would go back down, with a system that's probably less efficient because it would have to be based on politics rather than the geography.

At the same time, both the EU and Japan are seeking to get three to six-month wavers to give them time to figure out where to buy oil and petrochemicals. Makes sense. But would it not also stand to reason that Iran could use that three to six month window to figure other places they could sell their oil?

The only obvious effect I see would be giving the Chinese a buyer's monopoly (or monopsony in fancy econ-talk) over Iranian crude. They are already negotiating pretty steep discounts from Tehran. Helping the Chinese get cheaper oil seems like a bizarre way for Europe, the US and Japan to halt Iran's nuclear program. But I would wonder how long even that can last. And I would guess there are plenty of small African or Eastern European countries that the big powers pay scant attention to that would be happy to start taking some cargoes from Iran under the table. China wouldn't be the only buyer, at least not for long.

Something doesn't add up here ...

Thursday, January 5, 2012

El vigilante

Today was one of those few days I when I thought about these people that are in every corner of my life. I was looking for a key to our stairway door, and popped by the security guard’s window on the way out of the apartment.

You’ll have to ask the concierge, I can’t go up those stairs. Or even go into the lobby or the parking lot. They barely even let me in here, he said, pointing to the small, cramped security guard booth.

It’s the sort of job most likely to go to Venezuela’s most luckless. These are folks that live in and don’t have highschool degrees or marketable skills. It’s a clear isolation on the other side of the luxurious office towers and swanky apartment buildings to industrial warehouses and buildings in construction. With crime an increasing concern in Venezuela, the vigilante is a fixture of life.

Fifty years ago maybe they would have been cutting cane, lifting blocks or hauling salt. Today that manual labor has been replaced with constant boredom, texting and fiddling with a cell phone, and the struggle to stay awake on shifts that often last 24 hours at a time – one day on, one day off. A one-liner I heard not long ago summed it up fairly well – Ando mas ladillado que un vigilante sin saldo … I’m in a worse mood that a security guard with no credit on his phone.

I’ve always thought it questionable what sort of security they can really provide under these circumstances, particularly given that they’re going to be the first in the line of fire if something does happen. Nobody with any means would consider living in a building without a vigilante, but almost nobody trusts them.

“Whenever something goes wrong, the first one they blame is the vigilante,” said the security guard at my mother-in-law’s lower-middle-class gated community after a house was robbed a block away. The kid’s got a technical degree and trying to finish highschool but he can’t get his studies done while on the job. My in-laws get along well with him and his coworkers, taking them food on holidays and cracking jokes on the way in and out of the gate.

That’s not the usual relationship. In one apartment I lived in, the landlord was shocked when I asked him to leave the key with the security guards. “With those criminals? Are you crazy?”

Trouble is I can understand the mistrust. These are folks at the edge of poverty and simultaneously at the edge of opulence. They live in hillside slums that generally function as little villages, everybody knows everybody and everybody knows everybody’s business. My gut instinct says it’s not the security guards themselves that get mixed up in crime. But something tells me it’s only a matter of time before some true criminal approaches them and asks them for some small piece of information that would enable a break-in, a car theft, a kidnapping. Many would probably back away. I can imagine many others would not.

Investigations of apartment break-ins nearly always turn up evidence that the people who did the hit had some kind of inside information that helped them do it. That is almost always followed by genuine shock and consternation that such information could have gotten out. People in Caracas do all sorts of other things to take their security seriously – a battery of car alarms, triple locks on doors, electric fences and security cameras. Rarely does anyone mention the idea of paying for security guards whose social conditions might allow them to live further away from the criminal elements they are supposed to protect folks from.

Sunday, January 1, 2012

Where are all these ADD drugs going?

Drugs to treat Attention Deficit Disorder are in short supply these days. The story is making the rounds this week, with full takeouts both here and here. I've always wondered when this issue was going to bounce back into the media particularly into the financial wires.

Drugs like Adderrall, Ritalin, Stratera and a host of others are meant to increase focus and improve concentration for people -- mostly kids -- that suffer from ADD. They are generally stimulants of various different forms that not only keep people more focused but also let them stay awake longer. They're supposed to be very closely controlled, but reality appears that they're not. The trouble is that people who don't have ADD and take drugs like these -- unlike a non-diabetic receiving insulin -- receive the same benefits as the folks they are actually prescribed for.

This story from the New Yorker three years ago hit on exactly this issue. Instead of remedying a genetic or psychological  disorder, these drugs are turning into performance enhancers for kids who want to be able to get good grades while still partying to their heart's content. In many cases they're used not by failing students to improve grades but rather by kids that already get good grades but want to do so more efficiently to have more time for their extracurriculars.This story (and others that I've heard from friends) suggest it's not very hard to get these meds. Just show up at the campus shrink with vague descriptions of a series of pre-determined symptoms and you're on your way.

So it really a surprise that these things are in short supply?

Breaking the body to build the mind

For more than a year I’ve been kicking around the idea of doing one of these 10-day meditation marathons as a way of adding to my five tepid years of the practice. I think I can handle the emotional isolation involved, but I’m genuinely concerned about the physical pain.

We’re talking about sitting cross legged for 10 hours a day for ten straight days.  I can’t sit cross legged for 10 minutes without pain shooting up my back and down my sciatica. I famously can’t make it through dinner without standing up to stretch my legs. I’ve got two partially herniated discs that I’ve managed to control over the years with a combination of exercises and abandoning the fun stuff I used to do like long-distance running. How am I gonna make it through a marathon of sitting up straight?

The primary complaint about physical discomfort for folks that do Vipassana is back pain. And this is for people that don’t generally suffer from back pain.

I’ve done a few Google searches and found a lot of references to Vipassana meditation as a way of reducing back pain, which is often linked to stress. This seems like good and bad news. I’d be happy to add it to my back-relief arsenal that already includes stretching, sit-ups, pushups, and all other manner of funny looking abdominal exercises. And I’ve always been underwhelmed by Western medicine’s approach to back pain, as well as Western society’s horrid treatment of our backs. It took me some time to stop expecting doctors to be able to do anything about back pain, and once I did I found that I could get along with them a lot better. These days I don’t bug those doctors and they don’t bug me, but then again they ask me to sit on my butt for 100 hours.

Still, there’s something scary in this “it’s all in your mind” approach, even if that happens to be true. My guess is upon starting Vipassana I’ll try to explain that I’ve got disc hernia that makes it hard for me to sit still, and a peacefully smiling instructor will tell me that back pain in fact comes from spiritual imbalance and that there’s nothing for me to worry about. Everyone goes through back pain during meditation, they’ll say, you’re no different, and you have to stop listening to what those doctors tell you.

If you’ve ever had chronic back pain you know it sucks. I’m fully ready to believe that a good chunk of it’s in my head. I’m hoping this will teach me how much of it is.