And in other news

Some things just lend themselves to smart ass responses:

• New York Jets fans are demanding that Mark Sanchez be immediately inducted into the hall of fame.  Sure he hasn't really done anything yet, but he takes a nice picture and seems to be much less of a jerk than the last guy.
• Apparently Angela Merkel was also considered as short listed for the Nobel Peace Prize.  The fact that she has only bought one bankrupt car company probably counted against her.

Analyzing a Clunker

Megan McCardle has pointed out that the 'successful' cash for clunkers program has resulted in a rather nasty hangover for automakers. Her argument is that:

Cash for Clunkers moved a bunch of auto sales forward, causing people who thought they might replace their car in the next year or two to rush into the showrooms.

This is a true but incomplete explanation. The Cash for Clunkers sales likely came from several sources:

1. Once the program was announced many buyers likely postponed purchases until they could take advantage of the subsidy. So sales in the period immediately prior to the start of the program were artificially lowered.
2. As Megan points out, people who intended to buy a car in the next year or so likely brought forward their purchase in order to take advantage of the subsidy. So sales in the period after the end of the program were (and will continue to be) artificially low.
3. People who were weighing up possible purchases opted to buy a car, as opposed to say new appliances or a trip to Disneyland, in order to take advantage of the subsidy. So higher car sales were balanced in part by lower sales in other parts of the economy.
4. People who might otherwise have saved or paid down debt opted to purchase a car in order to take advantage of the subsidy.

Sales resulting from explanations 1 and 2 were simply a direct wealth transfer from future taxpayers to car buyers. There wasn't any real impact on the number of cars sold, just the timing, so the car companies aren't really better off. Any stimulative effect on economy would be the result of car buyers choosing to spend rather than save their subsidy windfall.

By contrast, sales resulting from explanation 3 were rather more insidious. In addition, to the wealth transfer from future taxpayers to car buyers these sales also include a wealth transfer from non-car companies to their automotive brethren. In other words, politically favored companies got some increased sales at the expense of those with less political pull.

Overall, these sales don't represent any increase in aggregate demand. Again, any stimulative effect on economy would be the result of car buyers choosing to spend rather than save their subsidy windfall.

The subset of sales driven by explanation 4 was the most economically useful. Additional cars sold without an offsetting loss of sales in other parts of the economy actually represent an increase in aggregate demand.

So the utility of the program as a Keynesian stimulus depends on the proportion of sales driven by explanation 4 and the extent to which the windfalls enjoyed by car buyers driven by explanations 1, 2 and 3 were spent rather than saved. It is possible, even likely, that the effective stimulus was substantially less than the $3 billion plus the program cost.

Taking a broader view, this program suffers from the same problem that dogs most stimulus initiatives. A small fraction of the economy will experience direct benefits. The remainder of the economy will simply see future costs in the form of higher taxes, interest rates and inflation, and a more politicized economy. For this reason, stimulus efforts that aren't linked to future productivity improvements are, at best, a questionable idea.

Lula Over Obama

In the high profile lobbying contest to win hosting rights to the 2016 Olympics Brazil's President Luiz Inacio Lula da Silva has completely shellacked President Obama.

In the grand scheme of things the location of the 2016 Olympics isn't of great importance. In fact, Chicago is probably better off for having lost. However, Obama's involvement in Chicago's bid displays in microcosm one of the key problems with the Obama presidency.

Having stood aloof from the selection process, the president swooped in at the last minute, made a pretty speech and expected to swing the vote.

By contrast, the rather more effective President Lula da Silva was far more engaged. He apparently understood that the result would be decided well before the TV cameras were turned on. Lula was so confident he had the votes that he supposedly pressed the Obamas to go to Copenhagen.

President Obama's approach to the Olympic selection process mirrors his approach to the far more important issues being decided on Capitol Hill. Stand aloof from the messy politics and trust that golden voice to swing the necessary votes.

It appears that we have an applause line President. He looks great on TV and gives a great speech. These are fine qualities in a politician, but fall well short of what is require to make an effective leader. When it comes to shaping legislation and winning diplomatic fights he is doing about as well as you would expect for a guy with a whole half term of Senate experience.

Profound Insight on Fiscal Stimulus

From the Stand-up Economist:

If I had to pick an animal to describe the US economy right now I'd have to go with the hamster. But like a really tired hamster that has been running around its cage for like seven years. Right now it's exhausted.

As a micro-economist I would say that the hamster needs some rest. Macro-economists, of course, look at the hamster and think that it needs some methamphetamines.

Now, I'm sure that they are right. Over the past month I've learned that the three most terrifying words in the English language are, "macro-economists agree that".

I'm sure they are right about the hamster needing methamphetamines. But all I'm saying is that in two years that is going to be one ugly hamster.

Conspiracies, vast and imaginary

Bill Clinton apparently believes that the "vast right-wing conspiracy" that undermined his presidency (Did Republicans smuggle buxom interns into the White house?) is diminished but not dead.

This vast right-wing conspiracy theory is just as dopey as the vast left-wing conspiracy theory that remains very popular on Fox News. Isn't it about time that America's leaders came to to accept that some people will inevitably oppose their policies, dislike them personally, or find some other reason to make their lives as difficult as possible? It is a mystery to me why American politicians feel that they ought to be handled with kid gloves.

In the UK (also New Zealand, Australia, Canada and India) the Prime Minister is required to front up in parliament on a weekly basis and answer the best verbal assault that the opposition parties can muster. This forces the leaders of these countries to develop nice thick skins. It also removes any illusions they might have about entitlement to deferential treatment.

By contrast, American leaders, who generally avoid unscripted situations whenever possible, are complete wusses. Perhaps weekly 'President's Questions' in Congress toughen up the denizens of the White House so they don't feel the need to cry like little girls when people don't treat them nice.

The Wisdom of Reich

Former Secretary of Labor and commentator extraordinaire, Robert Reich, has been raised an interesting question:

So how can the Dow Jones Industrial Average be flirting with 10,000 when consumers, who make up 70 percent of the economy, have had to cut way back on buying because they have no money? Jobs continue to disappear. One out of six Americans is either unemployed or underemployed. Homes can no longer function as piggy banks because they’re worth almost a third less than they were two years ago. And for the first time in more than a decade, Americans are now having to pay down their debts and start to save.

Even more curious, how can the Dow be so far up when every business and Wall Street executive I come across tells me government is crushing the economy with its huge deficits, and its supposed “takeover” of health care, autos, housing, energy, and finance? Their anguished cries of “socialism” are almost drowning out all their cheering over the surging Dow.

So, if all this Keynesian policy is so bad for the economy, why are investors so bullish? Mr Reich's argument is the Keynesian stimulus is working for corporate America (if not for ordinary Americans).

However, there are several plausible (non-Keynesian) explanations:

1. The bull run is really just a bounce back from the panic selling that occurred earlier in the year. Even if the economic outlook remains bleak, it's much less bleak than it was. Relief that the world isn't going to end isn't inconsistent with concern about the future.
2. US corporations are poised to benefit from a rebound in the world economy and a sinking dollar. There is nothing inconsistent about being bearish on the US economy and bullish on multi-nationals.
3. The market may think that many of the Obama administration's more ambitious proposals aren't actually going to pass. Cap-and-trade is already on the rocks, getting health reform through the Senate is far from certain and the volume of concern about the deficit increases every day. If investors think the Keynesian surge is already abating they may be more comfortable buying stocks.
4. It is clear that the government will find a reason to bailout just about any large corporation that runs into trouble. This policy of socializing losses is likely to promote corporate risk taking on a fairly epic scale. More risk means higher profit potential, which in turn means higher stock prices (arguably this is a form of state subsidy, but has little to do with boosting aggregate demand).

Obama not liberal enough?

It appears that some liberal Democrats are so incensed by President Obama's unreasonably centrist tendencies and willingness to compromise with Republicans that there is talk of Obama facing a primary challenge before the 2012 election.

It's no wonder that so many in the liberal base are falling out of love with the president. So much so that there is even faint talk of an insurrection if Obama doesn't straighten up and fly left. Recently, during an appearance on a cable TV show, Washington Post columnist Gene Robinson discussed the political costs for Obama if the public option is dropped from the health care bill. They included the possibility of a primary challenge in the 2012 presidential election. Said Robinson, "You don't want to see the progressive caucus in a foul mood."

A interesting question is whether the Obama re-election team would consider a primary challenge from the left a bad thing. If you were trying to get a relatively liberal president re-elected, a wild eyed progressive challenger playing up how crazily centrist and bipartisan your guy was might actually be an asset.

The only scenario in which this might be negative is if the president is so weak in 2012 that a primary challenger actually has a chance of winning the nomination. In that case President Obama might be forced to publicly tack left in order to win the primary, which might be the thing that costs him the general election.

'94 Nostelgia

Brad DeLong has written a pretty interesting piece on his reminiscences of the health care battles of the mid nineties. As Mr DeLong tells it, there was never any hope of getting a Democratic plan through the Senate. Key Democratic Senators weren't going to let a "hick from Arkansas" push through health reform. Even a reform they might otherwise support (charming).

All hope actually rested on an eventual compromise coauthored with Bob Dole. Apparently, this plan was sabotaged by "Gingrich and company", who allegedly made opposition to any Clinton health plan a condition of supporting Mr Dole's presidential aspirations. The moral according to Mr DeLong is:

I have drawn what I think are appropriate lessons from it. First, Democratic senators do themselves no good either in the next world or in this when they block sensible initiatives from Democratic presidents. (But what lessons are Democrats Landrieu, Nelson, and Lincoln drawing?) Second, Republican senators do themselves no good either in this world or in the next when they block sensible initiatives from Democratic presidents. (But what lessons are Republicans Grassley, Voinovich, and Hatch drawing?)

I don't know how accurate Mr DeLong's recollections are, however his conclusions are a little iffy.

On the subject of Democratic Senators Mr DeLong may have at least half a point. All elected Democrat's have a vested interest in making the President appear successful. Perceptions of how the President is doing will inevitably hang over every race in the coming mid-term elections. On the other hand, getting the President's bills passed is hardly a guarantee of electoral success. The Democrats may well have lost control of Congress in 1994 even if they had passed health care reform.

Regardless, the situation in 2010 will be very different from 1994. The 1994 election was a decisive swing against a decades long Democratic majority that resulted in Republicans picking up many marginal or even liberal leaning seats. The 2010 election will probably be more like 1996, 1998 and 2000 when the Democrats picked up seats as the Republican tide ebbed. This time around disgust with the Bush administration resulted in a Democratic flood in 2008. With the focus of anti-Republican feeling long gone, this tide too will begin ebb. The marginal Democrats who survive 2010 may well be the ones who recognize that the President is rather more liberal than their constituents and vote accordingly.

On the subject of Republican Senators, my guess is that they are drawing conclusions exactly opposite to what Mr DeLong would prefer. By Mr DeLong's own admission, the real political winners in the health care struggles of the early nineties were the Republicans who led the charge against 'Hillarycare'.

Dumbest thing I have read in a long time

This gem is from an opinion piece published on CNN.com by a former Republican staffer turned lobbyist. The subject is what the Obama administration can learn from the way Republicans were able to pass the Medicare prescription drug benefit:

Under the leadership of Speaker of the House J. Dennis Hastert, a veteran of many health care battles, and Senate Majority Leader Bill Frist, himself a physician, Republicans were able to get critical interest groups, including the usually left-leaning AARP and well-funded trade association PhRma, to join forces in support of the reform effort.

Yes, ladies and gentlemen, by truly heroic efforts Mr Hastert and Mr Frist managed to get the AARP to support a massive new benefit for seniors and, unbelievably, the pharmaceutical industry to support massive government subsidies for prescription drugs. One wonders how on earth they were able to pull off such a herculean feat.

Of course, the President has in fact already lined up support from the AARP and PhRma. However, support from AARP members remains somewhat equivocal since funding for the plan relies on several hundred billion dollars in efficiencies (cuts) to Medicare. If only he would follow the Republican example and drop even the pretense of making the plan fiscally sustainable perhaps all would be well.

Ahhh......so a public option will work?

The New York Times has found a working example of a public health care option that may, or may not, put all your concerns to rest.

The early results are in. Today, almost all residents in the city have affordable access to a comprehensive health care delivery system through the Healthy San Francisco program.

This sounds like good news. However there are some caveats:

• Mandated health spending by employers is substantially higher than in Massachusetts (which doesn't have a public option) or any of the national plans being considered by congress.
• The public option is somewhat limited in that services are only available in San Francisco (it isn't technically insurance)
• The costs are being passed on to consumers in the form of higher prices. Healthcare surcharges are now common for service businesses.

Salient facts not mentioned in the Op-ed piece are that:

• San Francisco started with an uninsured population of 60,000 out of a total population of 809,000. 7.4% uninsured is less than half the rate for the country as a whole.
• In the the last census the City and County of San Francisco was 19th wealthiest county in the US with a per capita income 1.5 times that of the country as a whole.

So, one of the richest counties in the country was able to institute a very expensive health scheme that includes a public option in order to cover a relatively small uninsured population. Furthermore, this has not resulted in obvious negative employment consequences or dumping of employees onto the public option because employers have been able to pass on most of the cost to consumers and the mandated employer spending is so high that the public option doesn't really compete with private insurance.

On the whole, it appears that San Francisco's plan works by being not very much like anything that the administration is proposing.

A Questionable Defence of Malarkey

Mark Thoma has published a detailed rebuttal of the idea that the the Waxman-Markey (carbon permits) bill is a massive corporate giveaway. Mr Thoma's reasoning is that:

The split over the entire period from 2012 to 2050 is 53.4% for consumers and public purposes, and 20.1% for private industry.

Assuming you believe Mr Thoma's math, Waxman-Markey is actually a massive giveaway to consumers, special interests and private industry. This is not exactly a compelling defense.

The problem with the bill is not the manner in which the giveaways are divided. It's the existence of giveaways.

The whole point of a cap and trade system is to price carbon emissions and thus incorporate the cost of CO2 emissions into the price of everything those emissions produce. Price signals can then drive innovation to minimize the carbon use and ensure that maximum economic benefit comes from the level of emission we believe is acceptable. If carbon permits are given away, regardless of who exactly the giveaways are intended to benefit, this price mechanism is undermined.

The fundamental problem here is that American public would apparently like to believe that the transition to a low carbon economy can somehow be achieved without carbon based energy becoming significantly more expensive. Unfortunately, there is no free lunch to be had here. A major restructuring of the US economy isn't going to occur unless the financial incentives surrounding energy use are significantly realigned.

What Congress should have done is create a fully auctioned cap and trade system, then used the resulting revenue to lower and simplify income taxes. This would have shifted the burden of taxation from a earned income (generally considered a social positive) to a negative externality without increasing the overall tax burden on the economy. Energy would get more expensive while labor gets cheaper. It would also likely have created a broad base of political support for cap and trade.

Tragically, this is not what happened. The administration, somewhat naively, expected their fully auctioned program to become a new and fruitful source of revenue to fund its ambitious spending plans. When this proved politically unfeasible, the congressional leadership was allowed to use carbon credits giveaways to buy off opposition to the bill. In its desperation to achieve legislative success, congress has not flinched at undermining the bill's original objectives. The revised bill is more politically palatable in that it apparently won't really affect energy costs. Of course, if energy costs aren't affected there is very little chance the thing will actually work.

It is revealing that Congress choose to lard the bill with energy use regulations. If the bill were going to effectively price CO2 emissions the regulations would be redundant. Market forces would drive change without the need for mandates from Washington. Clearly, even Congress doesn't really believe that the cap and trade portion of the bill will drive change.

To be fair, the successful SO2 cap and trade scheme, on which the bill is based, gave away rather than auctioned SO2 emission rights. The prospect of selling surplus SO2 credits, or the threat of having to buy extra credits, encouraged enough companies to find ways to limit SO2 output. So Waxman-Markey may not be completely hopeless.

However, SO2 was a relatively minor problem that could be minimized without a wholesale restructuring of the US economy. It is extremely difficult to believe that a similarly low key approach will yield the changes required to move us towards a low carbon economy. For those of us who believe in harnessing the power of markets to solve environmental issues Waxman-Markey is a profound disappointment.

Treasury Auction

Today's 30-year treasury bond auction apparently went smoothly, with prices even firming slightly in subsequent trading. I confess that I don't fully understand why there is such strong investor demand for long term (and thus inflation sensitive) treasury debt. Some of the possible explanations are:

1. The bond market is deeply pessimistic about the economy, meaning that deflation is a possible concern and holding 30 year government bonds with a 4.5% yield is actually quite attractive.
2. The bond market is very optimistic (snicker) about both the Fed's ability to shrink its balance sheet and government's ability to bring the fiscal deficit under control when the economy improves, meaning that inflation is not a threat.
3. Global imbalances have become, to an extent, self perpetuating.

The third explanation arises from an old, informal rule of banking, "If you owe a $100 the bank owns you. If you owe a $100m you own the bank". My thinking here is that the United States has become a debtor that is too important to be denied credit.

Due to years of conscientious currency manipulation China (and other trade surplus nations) have accumulated enormous dollar assets. Protecting the value of these assets is not an insignificant concern. This means that US interest rates cannot be allowed to go up in any situation where the rise would not be accompanied by an offsetting rise in the dollar.

The 30 year bond auction was just such a situation. A poor auction would have resulted in higher long term interest rates. Normally higher rates would put upward pressure on the dollar. However, right now, a bad auction would imply that the government is going to have difficulty funding the deficit, increasing the likelihood that the deficit will be monetized, which would be bad for the dollar.

So a bad auction would likely mean US interest rates up and the US dollar down, which is the worst possible combination if you happen to be a foreign power that owns a lot of dollar assets.

If you were such a power my guess is that ensuring a strong auction, by say bidding for a bunch of bonds, would start to look like a pretty good idea. Interestingly, indirect bidding (i.e. by foreign central banks) during the Treasury auction was described as "strong".

The Rich Get Richer

Sports Illustrated columnist Andy Staples is very concerned that a down economy plus a trend towards big revenue TV deals for the major conferences means that the 'haves' in college sports will be increasing their edge over the 'have nots'.

On Monday, Florida coach Urban Meyer agreed to a six-year contract that will pay him $4 million a year. Earlier this year, the Alabama state university system's trustees approved earlier a $80.6 million project that will expand Alabama's Bryant-Denny Stadium to accommodate more than 101,000 fans. Meanwhile, on the other end of the Football Bowl Subdivision food chain, Hawaii athletic director Jim Donovan last week took a voluntary seven percent pay cut to help offset a projected $2.6 million deficit for the 2008-09 fiscal year.

I'm actually a little skeptical of this argument. College football royalty like Florida already get the best coaches, the best facilities and (most importantly) its choice of the best players. So it is far from certain that an increased budget will generate any better results. Will Urban Meyer be a better football coach because his salary went up by $750K per year?

Like most human endeavors, college football is subject to diminishing returns. Beyond a certain point adding resources to a football program like Florida's is really just padding costs. Where the increasing big school revenue advantage is likely to pay off is the non-revenue sports. The excess revenue generated by the football and basketball programs can buy those big money schools a lot of wins in soccer, tennis, track and swimming.

Banking Compensation

The front page of today's Wall Street Journal features yet another article on the bonuses being paid to bankers at institutions recently bailed out, or essentially owned, by taxpayers. For those of us who aren't collecting these bonuses this is either infuriating, mystifying or simply mind numbing. It may be helpful to step back for a moment and look at why banking can be such a lucrative profession. Consider the following example:

Bob over at Silverman Slacks is setting up a deal to sell a package of derivatives to a group of hedge funds. An average investment banker should be able to get $1B for these securities. However, because of his superior acumen, drive, reputation, persuasiveness and network of contacts, Bob can do 0.001% better than the average I banker. In most industries a 0.001% advantage is insignificant. However, because of the scale of the transaction involved, in this case that 0.001% advantage translates into $1m in additional profit for Silverman. Or at least it would, if not not for the inconvenient fact that Bob understands the significance of his 0.001% edge.

In order to prevent Bob from taking his 0.001% advantage over the road to Morbid Stansted, Silverman has to cut Bob in on the additional profits his superior abilities generate. Assuming that Bob can reliably generate $1m in additional revenue on $1B deals then Silverman, assuming management is rational and the market for "talent" is competitive, should be willing to pay Bob $999,999 per deal. If they don't, Morbid Stansted will. With this kind of a compensation package Bob doesn't have to pull off many $1B deals to reel in a multi-million dollar bonus.

Wall Street types, who almost never suffer from a surplus of modesty, like to claim that they earn extraordinary bonuses with extraordinary performance. This is complete rubbish. The scale of transactions on Wall Street amplifies the effect of even incrementally above average performance. Meanwhile the personality driven nature of the business ensures that the rewards from those incrementally above average results flow disproportionately to the "talent" that provided the incremental advantage.

Note that this incremental advantage doesn't have to come in the form of higher profits for the banks. Incrementally lower losses are just as valuable. This is why banks are compelled to pay huge bonuses even when their results don't seem to merit it.

Borrow and Hope

Brad DeLong has come up with an interesting fiscal policy proposal (emphasis mine):

The fact is that the appropriate fiscal policy for the U.S, right now is to pass: (a) a bigger stimulus over the next two years, (b) a standby tax increase to return the federal budget to primary surplus by 2012, and (c) devout and lengthy prayers that confidence in the dollar doesn't collapse and send interest rates on U.S. Treasuries above the economy's growth rate--in which case the situation changes from its current value of "dire" to "catastrophic."

I suspect we should be a little suspicious of any policy prescription that includes "devout and lengthy prayers" as a key component.  Particularly when the other components seem designed to create the problem that the devout and lengthy prayer is intended to prevent. If I understand Brad's view correctly, the government appears to have two options:

1. Continue on the current path and endure an extended, painful recession.
2. Spend like a drunk sailor on shore leave, in which case things will either get better or confidence in the dollar will collapse, interest rates will shoot up and the economy will fall apart (those of us with limited faith in the power of prayer to influence economic trends would call this gambling).

I don't know about you, but I need a drink.

One Small Step For Man . . .

Megan McCardle is rather disappointed with lack of followup to the moon landing.

What happened to the dream? Government mismanagement, yes, but something more than that, too, some failure of imagination and will.

There are a couple of problems with this sentiment. Foremost is the fundamental misunderstanding of what the Apollo program was really all about. The United States didn't go to the moon because of some insatiable human desire to "boldly go where no man has gone before". That is retrospective romanticism.

The United States really went to the moon out of fear. Specifically the fear of Soviet domination of space. President Kennedy launched the Apollo project based on the advice of NASA deputy director Hugh Dryden's advice that a lunar landing was a sufficiently long term goal that NASA would have a chance to catch up with the Soviet's technological lead and actually get there first*.

By the time Neil Armstrong made his famous footprint, the fear of Soviet owned space had been thoroughly dispelled, and with it the driving force for human space exploration was lost. There are many legitimate reasons to criticize NASA's activities since the end of the Apollo program. However, exploring the rest of the moon, or putting a man on Mars, were not realistically achievable goals. The moon landing was a crash program put together in response to a perceived national emergency. That level of effort was simply not sustainable indefinitely. Adventurous spirit and scientific curiosity have never been enough to get political support for the kind of expenditures required to take further leaps into deep space.

It thus isn't really accurate to call the lack of progress since 1969 a failure of imagination and will. The last forty years have reflected the normal, frustratingly erratic, progression of most human endeavors. The 1960's was the aberration.

My other issue is with the, "What happened to the dream?" question. The idea seems to be that, in the absence of leadership from Washington, humanity's future in space has been put on indefinite hold.

In truth, the dream is in very rude health. The last decade has seen the birth of space tourism, the first private space flights and a burst of entrepreneurial enthusiasm. If you really care about space exploration you would do well to keep an eye on the development of the private sector rather than NASA press releases. If there is an economic return to be generated from commercial activities in space people will go there, even without government help.

We may very well see NASA astronauts back on the moon. NASA planing says 'yes', a realistic assessment of the federal budget outlook says 'not likely'. Even if NASA never makes it back I'm pretty sure somebody will. What's more, we may all have the opportunity to participate, not by paying taxes, but by buying stock.

As an aside, we could pay $100-$150 billion (optimistically) for NASA to put a base on the moon sometime after 2020, or we could put aside say $50 billion as a kind of super X prize to be awarded to the first organization to sustain a human presence there for 12 months. I know which alternative makes more fiscal sense for our cash strapped government.

* There are many non-fiction accounts of the 60's space program. However, perhaps the best way to capture the feeling of the time is to read Tom Wolfe's famous novel The Right Stuff. Or you can check out his recent Op Ed piece in the New York Times

The Scariest Sign in Seattle

Like 10,000 Spoons......

The following is from Karl Rove's opinion piece in this morning's Wall Street Journal (emphasis mine):

"So what's a president to do when the promises he made about his economic stimulus program fail to materialize? If you're Barack Obama, you redefine your goals and act as if America won't remember what you said originally."

Anyone who remembers the ex ante and ex post justifications for the Iraq war will appreciate the irony.