Every year The Economist publishes their Big Mac index, which shows the relative price of a McDonald’s Value meal in most countries. They use it as a proxy for which currencies are being intentionally kept low (mostly Asia) and which are too high (mostly Northern Europe).

I like it when economists don’t take themselves too seriously.

No contemporary newsman has the courage to call out his government engaged in a disastrous war. Walter Cronkite did and when this broadcast was over Lyndon Johnson told a friend, “If I’ve lost Cronkite, I’ve lost middle America.”

If ever there was a reason to support the Change Congress organization, it was in three stories in today’s paper. Larry Lessig and his partners have maintained since the start of their campaign to change the campaign financing system, that the current power of special interests completely distorts our legislative process. Cases in point:

Lockheed-Martin and Saxby Chambliss-Lockheed doesn’t want the F-22 gravy train stopped and since they assemble it in Georgia, Senator Chambliss is happy to jam more F-22’s down the Pentagon’s throat, whether they want them or not.

Mr. Chambliss said the concern about losing military jobs had also been important, particularly for senators who are “on the fence.” Lockheed Martin Corporation assembles the plane in Mr. Chambliss’ home state, in Marietta, and uses suppliers in 44 states.

Mr. Gates, in speaking to reporters, said with some exasperation that “the more they buy of stuff we don’t need, the less we have available for the stuff we do,” adding: “It’s just as simple as that. It ain’t a complicated problem.”

That John Kerry and Ted Kennedy are backing Chambliss under the guise that it’s a “jobs bill” is pathetic. If Lockheed really wants to keep making the F-22, why don’t they sell them to the Europeans, Japanese or South Koreans?

The Presidential Helicopter-Obama says he’s very happy with the current helicopter and Bob Gates says Lockheed-Martin argues a new one should be built that would allow “the president, among other things, to cook dinner while in flight under nuclear attack”. Maurice Hinchey, congressman from New York is Lockheed’s water carrier on this one, so we’re going to spend $485 million to save 600 jobs at a Lockheed-Martin plant in Oswego, New York. The power of the Military Industrial Complex to distort our priorities never fails to amaze me. President Obama should show that he and Gates mean business and veto the military spending bill if these items are left in.

John Boehner and the Auto Dealers- Congressman Boehner thinks he knows better than the CEO of GM how many dealerships they need.

On Thursday, John A. Boehner of Ohio, the House minority leader, said at a news conference that he “never understood how cutting car dealerships reduces costs for the auto companies.”

Maybe Mr. Boehner, and his bi-partisan colleague in this farcical boondoggle, Steny Hoyer should be forced to take an Economics 101 course in which in the first week you learn about the law of supply and demand. There are way too many car dealerships in America and Honda does very well with 1/3 the number of dealers as GM.

Evidently many in Congress could use an Econ 101 refresher course. According to CNBC, Rep. Marcy Kaptur, in questioning Hank Paulson yesterday, did not seem to grasp the basic concepts of what a warrant was. While we’re on the subject of these warrants to buy stock in Goldman Sachs, JP Morgan Chase and other big banks–this was one of the few smart things that Paulson and Bernanke did. Jim Cramer is right. The Treasury should hold an auction and sell all of the warrants off. They will probably make a good chunk of change.

Spy Magazine used to have a regular feature called “Log Rolling in Our Time”–in which they would put side by side reviews of two New York Literati effusively praising eachother’s books. This little Faulknerian Tale of Republican infelicity down in Mississippi which is all about “you scratch my back, I’ll scratch yours” is going to be the plot of a soap opera in months. It involves ex Congressman Chip Pickering, Republican from Mississippi.

“[I]t was always the plan that (Chip) Pickering would assume Lott’s Senate position when he retired. … Creekmore-Byrd insisted that if Pickering accepted the position in the Senate that their relationship would not be able to continue and that Pickering being in public life would have to remain married to Plaintiff, Leisha Jane Pickering. Therefore, they would not be able to continue their relationship. Ultimately, Creekmore-Byrd gave Pickering the option to remain a public servant or become a private citizen and continue relations with her.

Pickering left his family and Congress and went with Miss Creekmore-Byrd. But this is also a story about one of the great “Act like I’m a capitalist, but really be on corporate welfare from the FCC stories”. Mrs. Creekmore-Byrd is on the Board of Telepak (see route map above). They now pay Pickering to be their lobbyist.

As everyone knows, the majority of the Universal Service Fee (USF) tax you pay on every phone bill goes into rural telecoms like Telepak. One FCC Commissioner jokingly told me off the record that USF Funds go to pay “for the corporate Jets” of all the Rural Telecoms. They collect your taxes to pay for their jets.

This should end. USF funds don’t need to be decreased they need to be deployed as a subsidy for poor people’s broadband (which could include VOIP service) on a per capita basis to every state that will pay to every provider per customer who has this Lifeline Broadband Service. That service could even include the rent of a netbook or two.

Sound Exchange and some other backers of the notion of a ISP license fee to solve the music industry’s problems have put up a site called A Price For Music that let’s you play with various scenarios. I know the Copyleft is going to say it’s slanted, but it’s still a good start towards a conversation about what I think is the only sustainable solution for the long term health of poular culture.

Since the beginning of the Reagan era this country has engaged in a deceitful dialog about taxes. It’s getting worse not better. Yesterday the House announced a planned surtax on incomes over $500,000 to pay for the Health Care Plan. This is just dumb. Why can’t they just raise the top rate back to where it was in 1984? Look at where it was in the 1950’s thought of as the golden age of American prosperity.(Chart above)

On Energy, we have the same problem. We are going to try to institute a very complex Cap and Trade system that will be gamed by companies like Enron did, all because we don’t have the political courage to impose an energy tax at the source.

Why can’t the Democrats realize that Grover Norquist and The Club for Growth are political eunuchs? The American people would rather have simple straight-forward solutions to these problems.

The level of political cowardice in Washington today is mind-boggling.

While the Chinese are hell bent to be number one in the world manufacturing alternative energy equipment, were battling over where to place the damn turbines.

While most lawmakers accept that more renewable energy is needed on the nation’s grid, the debate over the giant climate-change and energy bill now before Congress is exposing a fundamental rift. For many players, the energy not only has to be clean and free of carbon-dioxide emissions, it also has to be generated nearby.

The division has set off a fight between Eastern and Midwestern politicians and grid officials over parts of the bill dealing with transmission lines and solar and wind energy…

For example, a wind machine in North Dakota would produce more energy than the same machine in some Eastern states — but energy projects tend to get built in places where they are most wanted.

The East Coast advocates may have won a crucial first round. When the House passed its sweeping energy and climate-change bill on June 26, it included a provision that lets the federal government overrule state objections to new power lines — but only west of the Rockies.

Can’t anyone look beyond their petty regional interests? Labor is totally mobile in this society. If the good jobs in the wind turbine business are best situated in North Dakota, then the workers will go there. China is going to grow at 8% this year and we’ll be lucky if we grow at 1% and these assholes in Congress are fighting over the placement of deck chairs on the Titanic.

We had a very good discussion here a couple of weeks ago about The Shift Index, a new way of looking at American corporate competitiveness. I had focused on the astonishing drop in Return on Assets, but both John Hagel and my colleague John Seely Brown pointed me to what they call the compensation gap (above)–where the creative workers (as defined by Richard Florida’s The Rise of the Creative Class) are taking more of the rewards every year. Having cut my teeth in the music and movie business, this was not a foreign concept, because it had been happening there since the late 1970’s. But Hagel and Seely Brown point out it is a phenomena in every industry. A report this morning on the resurgence of Goldman Sachs underscores their point.

Startling, too, is how much of its revenue Goldman is expected to share with its employees. Analysts estimate that the bank will set aside enough money to pay a total of $18 billion in compensation and benefits this year to its 28,000 employees, or more than $600,000 an employee. Top producers stand to earn millions.

In reading the good extract of the Shift Index, I was struck by the fact that the most creative workers are also the one’s that take the most advantage of the Digital Revolutions productivity enhancers. But these same high productivity individuals are increasingly embracing the freelance lifestyle–leaving their old jobs and then contracting out their services on a freelance basis to their old employers and sometimes even their competitors.

Could it be that the whole corporate world is going the way of the movie business, with its limited number of superstars taking most of the profits–the winner take all game? If that’s true, I’m not sure how corporate America ever returns to a stable, profitable state.

One last thought. I couldn’t mention Goldman Sachs without a note on Matt Taibbi’s extended screed on Goldman–The Great American Bubble Machine. I have been writing about our addiction to bubbles for some time and I certainly believe that Hank Paulson was looking out for his old firm (Goldman) when he took over AIG after having let Lehman fall. However, to try to ascribe all the manipulations of the financial markets over the last 80 years to a single firm is a bit like the old Trilateral Commission conspiracies in which all the world’s evils were ascribed to David Rockefeller and his associates. Goldman is the premier player in the financial establishment, but in blowing all the bubbles of the last half century, they’ve had lots of help.

Spike Jonze says “the amount of pre-planning and choreography by the directors Masashi Kawamura, Hal Kirkland, Magico Nakamura and Masayoshi Nakamura remotely from the other side of the world is of Michel Gondry level complexity.”

Watch it!

There is a guessing game going on in Washington this weekend over the nature of the secret program initiated by Dick Cheney that CIA Director Leon Panetta just found out about on June 23rd and immediately stopped.

The report that Mr. Cheney was behind the decision to conceal the still-unidentified program from Congress deepened the mystery surrounding it, suggesting that the Bush administration had put a high priority on the program and its secrecy.

My money is on the revelation that Sy Hersh quietly dropped on a shocked audience at the University of Minnesota in March.

Investigative reporter Seymour Hersh dropped a bombshell on Tuesday when he told an audience at the University of Minnesota that the military was running an “executive assassination ring” throughout the Bush years which reported directly to former Vice President Dick Cheney.

If we find out that Cheney was running an international hit squad out of the VP Office, I don’t see how he can avoid prosecution. The Cheney apologists will suggest it wasn’t “fully operational”, meaning the first hit of a foreign leader had not been accomplished by the time he left office. That quite frankly is a distinction that escapes me.