Thursday, January 19, 2017

Critically Misinformed - the state of Gov Rick Perry.

I was not aware of this until today morning, but it appears Governor Perry had a website where he put forth his views on the DOE. In these documents [see Wayback Machine link] Gov. Perry says he wants to

"However, within the Department of Energy, the National Nuclear Security Administration (NNSA) and other key nuclear programs must be preserved and re-located to the Department of Defense. "

This is not a good idea. 

I have discussed the impact of this kind of thinking before [see here]. 

It is one thing to have these kinds of out of the box ideas and something completely different to actually act on them.  

The entire game of nuclear deterrence is based on a delicate balance of costs. As long as the US can afford to maintain its arsenal and selectively prune it - it can deter any adversary. 

If you send the department on wild goose chases - you will waste a lot of money on stupid stuff and 
the end result will be an arsenal you cannot afford to pay for.

Having someone who knows what they are doing is critical to keeping the nuclear security side of things in good order.

It is a very bad idea to appoint someone who doesn't work in the main business unit as the head of this organization. If you don't know what actually works, you will not be able to figure out what to spend effort and money on.

This organization deals with the tools of mass murder and you cannot appoint any idiot with an MBA to lead it. The MBA flood has already killed most of the productivity in US industry - so it is best if a critical national security department is not added to that list of failures.

If you appoint some apparatchik to lead it - you will end up with a Chernobyl like situation. In Chernobyl, the entire department had become totally compromised by the Soviet equivalent of the bean counters. The whole facility was led by people selected for party loyalty and not adequate training. Catastrophe occurred on when one of these apparatchiks over-rode the opposition of the technical team and operated the reactor in a configuration where the coupling between the neutron transport equations and the heat transport equations was not knowable. The results was a meltdown.

This is not something one wants to repeat.

Just as a random guy on the street can't lead an army or navy or airforce - this department cannot be led by someone who lacks the proper set of skills.

Thursday, January 12, 2017

What could Russia possibly want?

There is a whole thread of news which points to the likelihood of xKGB elements of the Russian polity subverting Donald Trump's business and campaign for their purposes. People are even going so far as to say that Donald Trump might be a RIS provocation.

Let us suspend the question of whether all of this is true and focus on the "why" aspect of this.

Why would Russia want to plant their agent as the President of the United States?

As some of you might have seen Russia has the lowest GDP/nuke. The Russian GDP/nuke is even below North Korea. These numbers should make Russia jealous of China, India and even Pakistan.

This puts them in a precarious position economically.

This economic situation in Russia puts the focus on a very important aspect of nuclear deterrence - i.e. the cost of the deterrent.

In the game of deterrence, the key thing is to be able to maintain in the mind of the enemy an impression that any nuclear escalation will be met with unacceptable retaliation. If you can't do this - deterrence breaks down.

You certainly can't do this if you can't afford to maintain your nuclear warheads. Therefore the real game in the deterrence world is to maintain the total number of warheads at a level that is comfortable for your economy.

The Russians are quite far from that. As things stand, they were unable to keep their economic afloat during the Soviet era. When the USSR fell - the KGB moved  to secure itself in the collapse, but in doing so they made matters worse for everyone else in Russia. After regarbing themselves as "oligarchs" they basically robbed Russia blind to keep themselves in power.

Selling Russian oil on the open market outside of OPEC quotas worked for a while, but it could not keep apace with the cost of the warheads. When the Saudis dropped the price - the Russians were very unhappy and their economy began to slide. They tried to shore up their natural gas contracts in Europe, but found themselves working against powerful market forces and that didn't go as planned at all. The attempt at grabbing Ukraine didn't work out and the Russians found themselves facing even more sanctions.

This further exhausted their reserves and began to shake the ordinary Russian's faith in their xKGB ruling castes. That put pressure on the "System" to go to work.  In terms of popularity in Russia itself - any strategy that offends America is usually welcomed by the conservative sections of society, so at the very least - the xKGB dominated regime would buy itself some time.

So what would the logical outcome be of such a large and concentrated effort?

I think there are two distinct strategic directions, and I do not know which they will take

1) Get their agent in the US to reduce the pressures on the Russian economy. In doing so - the Russian GDP/Nuke ratio would rise.

2) Get their agent in the US to tank the US economy and in doing so reduce the American GDP/nuke ratio.

Both these strategies would cause Russia to enter the negotiations on arms reduction from a position of greater strength. 

Monday, January 09, 2017

Why are conservatives such hypocrites?

A common theme among conservatives is to make a huge fuss about something when a "liberal" does it and then blithely acquiesce to something ten times worse when a fellow conservative does it. There is an element of self-contradiction or lack of consistency which all conservatives adhere to regardless of which country or decade they are in.

Why is that?

The answer IMHO is simple.

"Conservativism" is a losing position. Change is the only constant in the world. Every conservative knows that no matter how much they invest in opposing it - change will happen and their world view rendered irrelevant.

If we were to take a time machine back thousands of years, we would see conservative Cro Magnons opposing the use of stone tools. The same community would later oppose the use of copper or bronze or iron tools instead of stone tools. And that cycle would continue.

Conservatives are always behind the times. And they know it.

As they know they will only be defeated - their only joy or reward comes from trolling their liberal opponents.

Every liberal offended or irritated is a victory for the conservative cause. The specific viewpoint is irrelevant as all conservative views are eventually consigned to the dustbin of history - the only thing that matters is *how many liberals did that view piss off?* - the more the merrier.

After an entire election cycle where conservatives only talked about accountability, criminal behavior, draining the swamp etc... etc... we will watch this week as the very same conservatives fall over backwards to put people with no OGE review and no proper vetting by Congress or Senate. They will put these people in positions of power despite ample evidence that these individuals lack qualifications and suffer from staggering conflicts of interest.

Many point out that these conservatives do not seem to understand if they do this kind of thing - they will get screwed. This people they put in power will take away their health care and social security or just rob them blind. This is incorrect.

The conservatives know that what they are doing will get them screwed, but they are okay with it.

Liberals feel agitated - "these fools don't realize what they are doing!"

No - mon ami - they understand and realize everything. They actually want to be screwed really badly.

They want to see their own social security and medicaid/medicare cut. They want to see their O'care nullified. They want to see their farms go bankrupt and they want to see their nation's defense collapse.

Why would anyone want that?

Because those ideas - a better quality of life, a secure nation, a robust economy etc... are indistinguishable form other conservative ideals - and so the conservative assumption is that these ideas too will eventually end up in the dustbin of history.

That is why they will never repent voting for a candidate like this.

They will always place their personal sense of satisfaction from trashing a liberal p.o.v over and above everything else including their/their family/their nation's well being.

That dear friends is the conservative way.  And it has no correlation with how much meth/heroin/cocaine one consumes.

Thursday, January 05, 2017

President Elect Donald Trump's Russia Problem

The baby boomer generation grew up being told that Russia was a nuclear armed threat to the US. They were told to be ready at moment's notice to "duck and cover" and that Russians were plotting to kill their parents, relatives, friends etc... and to reduce their country to ashes.

The boomers then faced a major cognitive dissonance when they learned in the late 80s that the Russians were just as human as they were and there was nothing to fear but a lot to gain. By the late 90s they were being told that Russia was this land of milk and honey where everything was for sale and it was the best place to pick up a bargain or a gas company or a mining concession or a oil well...

Most baby boomers didn't know how to process the information they were being handed. They reacted as all human beings to when presented with new information - they turned to fear and eventually to came to accept it.

Now those two narratives are fighting each other inside President Elect Donald Trump's head. They are also playing out vocally and visibly in his transition team. If Donald Trump the candidate had done his homework during the campaign and set up a real policy desk - he could have produced much greater consonance between his own team members. The policy desk would have enforced intellectual discipline and created space for accord and discord.

But Donald Trump the candidate didn't do that. He setup a policy desk but then didn't pay the staffers any salary for months. After some waiting and dilly-dallying they all left the operation and joined the ranks of Donald Trump's detractors.

Now President Elect Trump is paying the price for Candidate Trump's mistakes.

His team is comprised of people who get their news from Twitter. These people have no background in actual policymaking or comprehension of the historical evolution of policy. They are disconnected from the past, present and future. And so are all of President Elect Donald Trump's utterances.

Per James Henry's article in the conservative magazine The American Interest - it appears that most of the "Successful Businessman" tag that Donald Trump enjoys can be attributed to a well-masked infusion of conflict or flight capital from the FSU. When the USSR fell, elements of the KGB moved to quickly seize control of critical economic sectors. To that end any criminal alliance deemed necessary was entertained and actively engaged. This is how all those PhDs and Masters degree holders came to grace the ranks of the Bratva. This how a well trained economist came to reincarnate himself as the "Brainy Don".

The James Henry article also explains why the DTC is such a complete rats nest of LLCs and why Donald Trump will never release his income tax returns. You only do that kind of thing when you want to hide the source of your funds.

The article also explains Bill O'Rielly's comments about Donald Trump being hard up for cash. If you are investing money for the xKGB/Bratva - you have no idea what their idea of an IRR is. You are perpetually afraid of a rate hike and you are living on a pay-day loan. Given the rat's next of LLCs - you have no idea which way the debt is actually flowing and how much your next payment might be.

Since Candidate Donald Trump insisted that he was funding his own campaign - it is fair to assume that the funds for the campaign came from the usual xKGB/Bratva sources but since so many neutral sources have indicated that in fact Candidate Donald Trump didn't fund his own campaign - it is not fair to say that the xKGB/Bratva bought the election.

That said - all this is water under the bridge - the average Midwestern white male has been seduced by the GOP fantasy of being the only-thing-that-really works-in-this-country and he has bought into the idea that Candidate Donald Trump is the best negotiator that can be had under the circumstances. A large section of Midwestern women who seem infatuated with this fake image of manhood are drawn towards Donald Trump - this must just be the midwestern equivalent of the Carrie Bradshaw character of Sex and the City fame.  Together this group of people has ensured that Candidate Donald Trump becomes President Elect Donald Trump.

Will the Bratva follow the model of the 1990s FSU republics? will they deliberately pump and dump the economy and create a depression in the process? - Most likely - firstly because they know it works, and secondly because they have been sold nonviable notions of portfolio growth and when confronted with the reality of US economic stagnation - they will be left with no choice but to push as hard as they can and break the system in the process.

Will the Midwesterners who voted for Candidate Trump be screwed-six-ways-to-Sunday by their idol's relationship with Russia? will they see their living standard evaporate? will they see their social security, medicaid, medicare benefits end? will they see accountability of the political classes diminish? - Most likely.

Will they learn anything from it?  - Most unlikely. Any lessons that are learned will be learned by their children and grand children - not by the people that actually voted. As reported in may surveys after the polls, a majority of these people do not want Donald Trump to release his tax returns because they already know it will highlight their personal failure to choose properly. Rather than face this deeply personal embarrassment - they would prefer to feed the country to criminal hordes.

That says about as much about the future as one can at this time.

Wednesday, January 04, 2017

How much black money was recovered by "Demonetization"?

This is a big question that there are few clear answers for.

We had heard numbers like $45B before [1] now based on public sources, it seems the GoI intends to cut its borrowing by $2.64B  in the coming year [2].

When you compare this with the typical numbers reported in a VIDS (Voluntary Income Disclosure Scheme)- it is a comparable number.

So after all the hassle created by demonetization - it doesn't look like it has generated that much more income than a VIDS.

There is a law of diminishing returns on these things. I will leave it to the Modi Bhakts as an exercise to figure out what that is.

Now I am not saying this is actually happening but....

Some people say that if I am the one taking the biggest bribes and cutting all the illegal and unethical deals, I shouldn't let anyone else get in on the action so to speak because let's face it - those guys are going to do deals around me.

Heck if I let them do all the dirty deals they want - they could even make a deal to push me out of the seat of power! I mean seriously - if they can do all this shit themselves - why the f*ck would they need Me?

I couldn't possibly allow that - I am primus inter pares baby. There is only one Numero Uno, Number One, el Jefe de Jefes... and that is Me.

Laissez Faire ONLY applies to Me.

Only the things I do are legal - everything else is illegal unless I say it is not.

And don't you dare oppose Me, because Apres Moi... Le Deluge.. mon ami.

Again - no connection to anything that might be going on anywhere - just saying - that some people say - Look out for No. 1.

Friday, December 30, 2016

The New Cold War is out in the open now

Russian interference in US electoral affairs has finally triggered the visible emergence of the New Cold War.

There were often hints of a New Cold War, but these were limited to chatter on the internet and in the occasional outburst by official sources in the media.

The war was intense in cyber space - but now it has entered into the real world.

To recap - when the Soviets and the US realized they could not nuke each other to death, they fought a bitter and terrible conflict which we call the Cold War. While maintaining a twisted kind of nicety in public and carrying out grand gestures towards each other on the world stage, the two sides spent vast sums of money on undermining each other. A great atmosphere of tension existed and every move had to be considered with the mindset of a chess grand master.

It was a strange world, but it was one I grew up in. One that I got used to.

Most of the millennials would find these ideas absurd. I recall vividly the empty looks in the eyes of my teenaged nephews when I tried to tell them about this history. They couldn't understand how a war could be raging a few feet from their house and they would be completely clueless. The idea of a Soviet illegal living among them as a perfectly American family might was crazy. They couldn't get their head around the idea that Joe and Jill Schmoe next door might actually be Pavel and Anne Gottslieb from Finland and that when they weren't baking apple pies, they were putting together attack plans on the nuclear missile launch complex that was ten miles down the street. Naturally my nephews didn't know about the nuclear missile base either.

Unbeknownst to many in my own generation - the old Cold War was actually horribly expensive both for Russia and the United States. Not many realize how many man hours this kind of thing chews up in unproductive activity. It is always better than a nuclear war or conventional war, but it is still extremely expensive.

I don't know if Russia actually hacked the electoral machines. It may be as the evidence so far suggests Russia tried to slant the election against Hillary Clinton and leak all manner of nasty bits and bobs of information via Wikileaks, DC leaks and so on. Whatever they did - I am guessing that it was premised on the idea that somehow Donald Trump was a far easier adversary to manage in a New Cold War. 

I want to point out to the folks at Yasenevo - that premise may be fatally flawed.

Donald Trump has a well known tendency to say something and then completely reverse himself in seconds. When confronted about this he compulsively gaslights the people asking the questions.

Look at the way he treats the press in the US, the manner in which he manufactures hatred of them in special interest groups. Why would any SVR analyst think that he would not do the same with a foreign nation like Russia? If he treats his own countrymen so badly - why will he treat foreigners any better?

The simple fact is that Donald Trump only behaves nicely with people who have huge teams of lawyers to go after him. He only bows to someone he sees as a bigger and better armed fish. Therein lies the place where it all falls apart. Whatever Carter Page is saying to you, whatever "Rexie and Putie" pulled together looking at maps - the only way to actually achieve any of that is to keep RU Nuclear Forces at high alert. That is leverage that RU will not be able to do without. President Donald Trump will blow smoke up President Putin's ass just the way candidate Donald Trump blew smoke up the asses of millions of Americans that voted for him.

Raising the readiness level of Russian nuclear forces sounds possible in theory - but in practice - we all know that is very very expensive and Russia with all its infinite might can't actually afford that expense right now.

I know that sometimes in Moscow (like that time when Hitler's army charged across the border)  it becomes hard to state the obvious. How many high ranking intelligence personalities in Moscow knew that Hitler was conducting no exercise? - and how many dared tell Stalin? Is it a surprise really?

Unless someone voices the obvious - it is not clear how things will proceed divorced from the reality of the time.

If no one in Moscow dares voice the truth - the good luck -we are all going to need it.

Thursday, December 29, 2016

The economic effects of introducing tariffs on a national economy

Donald Trump has talked a lot about tariffs on China and Mexico. He has trash talked the TPP and NAFTA - which is what we use to trade with Japan and Canada. These four nations are our biggest trading partners and together with our financial partners in the UK and Europe - form the basis of the current global economic miracle.

I ran into this presentation on the effects of tariffs on a country [1]. It is pretty tersely written but slide 12-26 get into a macroeconomic description of the effects of tariffs on an economy as a whole. I am going to try and put this into words and fill out the missing parts of the presentation. I think this is a pretty decent discussion on econophysics.

For references keep this link to the wiki entry on supply-demand curves handy [2]

In any supply-demand curve there is a point at which the curves intersect. This point defines the price of a good/service in the market defined by that demand curve and the producers defined by the supply curve.

The area above the price point and below the demand curve is the benefit to the customer. If the price point is lower - the customer benefits more.

The area above the supplier curve and the price point is the benefit to the producer. If the price is higher the producer benefits more.

If you introduce tariffs - you increase the price of the good/service. This is basically the same thing as moving the supply demand curves relative to each other.

The result is a change in the areas corresponding to the customer benefits and the producer benefits.

When you have no tariffs the price is very low and there is a massive benefit to the customer. There is very little benefit to the producer.

Once you add tariffs to this situation, you move the price up and that decreases the consumer benefit but increases the producer benefits.

Now the part that is hard to understand is that the increase in producer benefit from tariffs does not have to equal or exceed the decrease in consumer benefit. 

Everyone who supports adding tariffs assumes this is a zero sum game - what you lose by way of increased prices is made back as salary people who produce the same good/service domestically. This is incorrect.

The supply demand curves do not have trivial shapes - the areas do not add up to the same amount. When you shut down free trade, you end up creating dead weight losses which are not picked up either by the producers or by the consumers. This is lost benefit that is never recovered.

Unless the amount of money earned in revenue to the government is somehow sufficient to overcome the dead weight losses - the act of introducing tariffs leads to a net loss of benefits to the nation.

This is not something that can be easily explained to people who want to use "common sense" instead of economics - but here is my attempt at translating this.

Currently you pay $100 for a Chinese smart phone. The US buys some 40 million of those a year. You might be willing to pay $200 per  smart phone so 40 M * (200-100) = $4B is you current consumer benefit. US manufacturers do not make any smart phone so there is no producer benefit.

Now tomorrow President Donald Trump introduces a 45% tariff on Chinese made smart phones. You have to pay $145 instead of $100. The high prices causes demand to drop by 25%. So now the customer benefits are 30M*($200-$145) = $1.95B. This is a net loss of customer benefit of $2.05B.

Now if it costs  $125 to make the smart phone in the US then by selling the same smart phone as the price of the import - US manufacturers could reap a benefit of $20*10 M =  $0.2 B. The US government would stand to get $45*30 M = $1.35B in taxes. A total producer benefit + tax gain would be $1.55B.

This would not be enough to offset the loss in consumer benefits. We would still be short by $.45B.

You can do this kind of calculation for every sector that we currently enjoy a consumer benefit in and the result is pretty much similar.

Applied across the hundreds of thousands of products we currently get from China alone - I think we would likely see a net consumer benefit loss of several trillion dollars.

What nukes does Russia want to test?

As you may have heard, President Putin and President Elect Donald Trump have indicated a desire to build stronger nuclear arsenals [1].

I think most of us have some guesses as to what that means at the US end - but what does it really mean at the Russian end?

As you might expect, it is very difficult to find actual information about Russian nuclear weapons design. The usual (American and British) sources are reluctant to talk about what they know about Russian designs and issues as this information is often secretly sourced. Only very skimpy descriptions of Soviet nuclear designs are known in the public domain. Wikipedia maintains a pretty decent archive of these things [2] but as you can see there is very little meat on the bone there.

We know that the basic soviet fission design centered around ideas gleaned from American sources via a formidable spy network. However as the spy network was disrupted and the American knowledge of higher yield fusion based devices was shaky at best when the network was still active - the Soviets had to come up with their own ideas for how to use fusion reactions in nuclear explosives. For some detail see LANL's wonderful history collection [3]

As indicated in the Wiki article - there is a tiny bit of insight into the workings of Soviet physics packages. We know that in 1948 Dr. Andrei Sakharov's team expanded existing notions about fusion boosted fission devices (capable of ~ 10kT) and developed a "layered cake/sloika" design. The bulk of the yield in this device came from fission reactions and the fusion yield was just to enable boosting the fission yield of the device (capable of ~100kT). We also know that by 1955, Dr. Sakharov's team had worked out how to build two stage devices and use the X-ray emission from a fission primary to compress fusion fuel (capable of ~ 1MT). The Sakharov team also pushed aggressively to see how far they could go with this technique and built a three stage device with a fission primary and two fusion secondaries. The X-rays from the first fission primary were used to compress the first fusion secondary and the explosion of the first fusion stage heated and compressed a second fusion stage. The result was a 50 MT design. A plan to add a boosted fission element to the design was abandoned after it was felt the yield might exceed 100 MT. In this fashion the Soviet physicists were able to create a design ladder that straddled the 1kT - 100 MT range.

These experiments in nuclear explosive design were sufficient to demonstrate Soviet mastery of the core ideas of nuclear weapons design (i.e. knowledge of the precision needed to control stacked sets of fission and fusion reactions) - but it too completely different tests to prove that it was possible for the Soviets to make practical nuclear weapons.

A practical nuclear weapon is one which can be used to deter an adversary from launching a nuclear attack.

A practical nuclear weapon is reliable - as in when you ask it to explode - it always explodes.

A practical nuclear weapon is safe - as in it doesn't go off when you don't want it to.

A practical nuclear weapon is economical - as in when you have it sitting in storage - you don't have to keep pouring ungodly amounts of money into refurbishing it.

The Soviets spent a great deal of time and effort in pursuing practical aspects of nuclear weapons design. And the Russian inherited all this when the USSR fell.

Things were pretty messed up for a while in the FSUs but over the last two decades Russia has consolidated its hold on *all* nuclear weapons mission critical resources. Perhaps the most revealing comment in  [3] is in the conclusion slides -

"The Russian nuclear weapons complex has downsized while modernizing within a smaller and more efficient footprint." 

This speaks to the Russian sensibility of maintaining their nuclear deterrent at economically acceptable costs. This is very reassuring to me as a human being - because I really do not believe the caricature of the mad vodka slugging Russian general who pushing the button while totally wasted. The Russians are fundamentally speaking a cultured and rational people - but their sense of culture and rationality is very different from what we might easily recognize.

I think all this together tells us what Russia wants to do on the nuclear front.

I feel that if the Russians want to test a new physics package - it will lighter, more survivable and more easily serviceable.

Leaving aside fantasies about a Gen-4 direct fusion package, one can visualize a small two stage or a FBF design as being more suitable for modification to such narrowly defined aims.

The first part of that is probably the least difficult given how much the Russians have inherited in package design from the Soviets. The Russians are also very good in the chemistry side of things, so it would not be too hard for them explore different compact explosive lens designs. The Russians have also made a lot of progress on the electronics side, so you can imagine that they are able to produce lighter weight rad-hard electronic controls quite reliably.

The second and third parts of that goal are somewhat more difficult as the design window narrows quite rapidly and trade-offs come into play.

If you want a physics package that can handle the shocks that accompany a sudden maneuver at Mach 27 (as you might want in a MARV as opposed to plain old MIRV)  you need to bulk up the warhead to handle things like the thermal shock and vibration. If you put a nice thick shell on the package and rigidly anchor everything inside it - you get a package that is very difficult to service and not very light.

There have been some advances in material science recently that permit you to push ahead with certain compromises but the utility of these in the demanding environment of a mass produced physics package is unknown at this time.

So that is where things may lead us in the near future.

If the Russians want to test new warheads - the best place to go would be to lower yield but better guidance. You can always use some Laser, RF signals or GPS to guide your weapons platform, but this is not secure and we all know that "Real Men only use INS". Most INS require a bullet-proof idea of what the errors in your gradiometer and gyroscope are. So any improvement on this side requires more work in gradiometry and gyroscopy. This in turn requires better gravitational mapping. Some of that work is going on [4,5] , one will need to see how such knowledge is transferred to the Russian weapons design side.

For external observers of the Russian special weapons program, the challenge will be to maintain a state of highly informed opinion. This is challenging at the best of times - and this is why an Arms Race as postulated by several people in the Non-Proliferation community might develop.

The Arms Race of the 50s developed because of an imperfect state of information on the size of the Soviet and American nuclear arsenals. When Edwin Land and others were able to bring the CIA's scientific intelligence operations to a level of maturity - the IMINT was able to reduce ambiguity and the Arms Race gave way to strategic arms limitation talks.

In our age - independent OSINT has taken the place of pride once occupied solely by the all seeing eye in space. This is where the bulk of the work will need to be done in the coming years.

Perhaps the best way to cope with a potentially dangerous situation would be for the Russians to educate the world at large about their plans.