Good piece by Graham Bowley in The New York Times:

It may come as a surprise that one of the most powerful forces driving the resurgence on Wall Street is not the banks but Washington. Many of the steps that policy makers took last year to stabilize the financial system — reducing interest rates to near zero, bolstering big banks with taxpayer money, guaranteeing billions of dollars of financial institutions’ debts — helped set the stage for this new era of Wall Street wealth.

Titans like Goldman Sachs and JPMorgan Chase are making fortunes in hot areas like trading stocks and bonds, rather than in the ho-hum business of lending people money. They also are profiting by taking risks that weaker rivals are unable or unwilling to shoulder — a benefit of less competition after the failure of some investment firms last year.

The Obama administration felt that nationalizing and recapitalizing banks directly would require congress to appropriate far more money than was possible. After all, if you think “bailouts” are unpopular now, just ask what it would look like if Obama wanted hundreds of billions more. Instead, they’ve used regulatory forebearance and other techniques to put banks in a position to recapitalize themselves through trading profits. And that’s what we’re seeing here. It’s an ugly, ugly business. They’re basically gambling on the taxpayers’ dime and operating with an implicit taxpayer guarantee to cover their losses if they blow up.

Ezra Klein asks Olympia Snowe if there are health care ideas that she likes, but that she doesn’t think are politically feasible. Something like how many people would prefer a single-payer system or the Wyden-Bennett approach but recognize that the votes in congress just aren’t there. She says:

I don’t know that I have anything in that category. I believe we should build upon the current system. We don’t want to disrupt that. I’m traditional in my approach towards reforming health care. Given the size and the amount of money we spend on it, I think it would be far too disruptive to upend the system. I think it’s preferable to build on what has worked well in our system and change the egregious practices in the insurance industry. I think the skepticism of that industry has been understandable and I share it, that’s why we really need to look at all facets to ensure they live up to certain standards and perform. But if they don’t, I think a trigger could be a powerful lever in that regard without having the government involved at the outset.

It’s probably helpful in some ways as a practical politician to let the contours of your ambition be totally circumscribed by practicality. But also a bit sad. A relatively small number of somewhat right-of-center senators have an enormous amount of practical power at this point in time. If more of them had more in the way of vision and ambition, they might really be able to get great things done. But the tendency is for them to be much more split-the-difference compromisers than big thinking radical centrists.

As misleading as the Superfreakonomics chapter on climate change seemed to me yesterday, the email that Steven Dubner sent to Brad DeLong really compounds the sin. Dubner whines that Joe Romm “makes it sound as if we somehow twisted and abused Caldeira’s research; nothing could be further from the truth.”

Go here and read for yourself pages 184, 185, and the beginning of page 186 of Suprefreakonomics. The point, quite clearly, is to lead you to believe that “hard-charging environment activist and all-around peacenik” Ken Caldeira share the Levitt/Dubner view that (a) environmentalists are overstating the extent of the climate change problem, (b) curbing carbon dioxide emissions should not be our main tool in combatting climate change, and (c) that it’s useful to disparagingly analogize advocates of CO2 emissions curbs to those driven by religious faith rather than scientific expertise. Caldeira is called onto the floor to speak as a voice of sober-minded science against the misguided CO2-limiters.

And here’s what Caldeira himself thinks about that:

[Caldeira] has responded to many email queries of mine over the weekend so I could characterize his views accurately. He simply doesn’t believe what the Superfreaks make it seem like he believes. He writes me:

If you talk all day, and somebody picks a half dozen quotes without providing context because they want to make a provocative and controversial chapter, there is not much you can do.

One sentence about Caldeira in particular is the exact opposite of what he believes (page 184):

Yet his research tells him that carbon dioxide is not the right villain in this fight.

Levitt and Dubner didn’t run this quote by Caldeira, and when he saw a version from Myrhvold, he objected to it. But Levitt and Dubner apparently wanted to keep it very badly—it even makes their Table of Contents in the Chapter Five summary “Is carbon dioxide the wrong villain?” It fits their contrarian sensibility, but it makes no actual sense.

Caldeira aside, it would be one thing if Levitt and Dubner wanted to make the argument that they have reason to believe that most scientists are mistaken about the climate change situation. But instead they make the claim that most environmentalists are mistaken about the climate change situation and that it’s Levitt & Dubner who are channeling the views of the scientific community. But according to the Union of Concerned Scientists “the fifth chapter of the book, ‘Global Cooling,’ repeats a large number of easily discredited arguments regarding climate science, energy production, and geoengineering.”

Of course it’s possible that the UCS is mistaken about some matters. And it’s possible that Ken Caldeira is mistaken about some things. But it’s not possible that Levitt and Dubner are correctly representing the views of Caldeira or climate scientists in general. Nor is it possible that Levitt and Dubner are correct when they assert that photovoltaic cells are black (they’re usually blue) nor is it correct to say that black PV cells lead to net increases in global temperature. These mistakes. A mixture of bad science and bad reportage on a crucial public policy issue, done by a writing duo who became famous for clever statistical analysis of trivial matters.

Avi Zenilman notes that both Laura Bush and Hillary Clinton cite The Brothers Karamazov as a favorite work of literature, and both specifically cite the “Grand Inquisitor” parable. Here’s Bush:

In the dialogue with the Inquisitor, Jesus remains silent, and the chapter has two endings, the first tragic, the second a victory for Christianity.

For Mrs. Bush, there was no ambiguity. ”It’s about life, and it’s about death, and it’s about Christ,” she has said. ”I find it really reassuring.”

And here’s Clinton:

Asked to name the book that had made the biggest impact on her, she singled out “The Brothers Karamazov.” The parable of the Grand Inquisitor in Dostoyevsky’s novel, she said, speaks to the dangers of certitude.

“For a lot of reasons, that was an important part of my thinking,” Mrs. Clinton said. “One of the greatest threats we face is from people who believe they are absolutely, certainly right about everything.”

The passage in question is deliberately ambiguous. That said, I think bother former first ladies are wrong. Clinton just seems confused. There’s a lot of stuff about doubt and certainty in Karamazov but not really in this part. Bush’s point of view I don’t really understand. From a literary perspective, the whole reason the parable is famous is because the Inquisitor’s argument is, as written, pretty persuasive. And yet it’s also repugnant! At the end, Christ’s faith is unshaken, but the Inquisitor is also unmoved. It’s the reverse of reassuring; it’s a deliberate provocation meant to shake us out of our complacency. If it was reassuring, it would be boring.

Japan has awesome trains and they’re could get a lot awesomer:

Central Japan Railway Co. (JR Tokai) has announced that the proposed Chuo Shinkansen maglev train line will connect Tokyo and Osaka in as little as 67 minutes.

Ah, to dream. That’s 511 kilometers.