Quick Hits

Hoover Digest has an interesting article about the war on terrorism. The premise of the article is that the world is engaged in a latter-day 100 Years War, which started with the collapse of European international dominance in 1918. According to the author, Clark Judge, the end of World War I had destroyed three empires -- the German/Austrian empire that dominated central Europe, the Russian empire that dominated Eurasia and the Ottoman empire, which dominated the Middle East. From the ashes of these empires came World War II (illegitimate totalitarian regime in Germany attempts to dominate Europe), the Cold War (illegitimate totalitarian regime in Russia attempts to dominate Eurasia) and now, the war on terror (illegitimate totalitarian fundamentalists attempt to dominate the Middle East). Judge notes in an interesting aside that in each case, the resurrected imperials have selected an Asian partner (Japan, China and North Korea, respectively) to complement its exploits, but he doesn't follow up on that point to see where it leads. [link]

Meanwhile, in view of the renewed focus on Iraq's weapons of mass destruction, or the lack thereof, Foreign Policy has an article revisiting and annotating a speech by President Bush on October 7, 2002 in Cincinnati, Ohio, where he made a detailed case for war against Iraq. As Foreign Policy points out, a comparison between the speech and declassified intelligence materials (the raw matter of intelligence, if you will), reveals that what the president said did not accurately reflect what U.S. intelligence analysts believed at that time based on the available intelligence. [link]

Finally, away from politics, for a moment, some of you may know that I have a professional interest in financial products, and have spent a fair amount of my career in the area of derivatives. Derivatives are financial products whose value is determined, or "derived" from the value of some other thing, say the price of crude oil, or the exchange rate of the Euro or the London Interbank Offer Rate (affectionately known as LIBOR). Derivatives, used correctly, allow someone or something that faces risk to pick apart the elements of that risk factor and then hedge against those elements in order to minimize or eliminate those risks. Used incorrectly, derivatives can spiral wildly out of control and cause grave economic damage either to the user or to a larger marketplace. Little wonder, then, that derivatives have been described as "Financial WMDs" and blamed for all manner of financial blowup from Enron to the recession. But now, Reason.com rides to the defense of derivatives. It's interesting reading, and well written. [link]