Good job, Arnie

California, Almost Broke, Nears Brink
The state of California — its deficits ballooning, its lawmakers intransigent and its governor apparently bereft of allies or influence — appears headed off the fiscal rails.

The state, nearly out of cash, has laid off scores of workers and put hundreds more on unpaid furloughs. It has stopped paying counties and issuing income tax refunds and halted thousands of infrastructure projects. Twenty-thousand layoff notices will go out on Tuesday morning, Matt David, the communications director for Gov. Arnold Schwarzenegger, said Monday night. “In the absence of a budget we need to realize this savings and the process takes six months,” Mr. David said.

California today, US tomorrow? (Actually I think it is not possible. The states cannot have deficits and go "broke" and have to somehow balance their budgets but the federal government can, of course, run deficits into trillions of $s of deficit....which the Bush administration duly did. (Speaking of Bush, if he were around, he'd probably be sending greeting cards to the CA Guvnor saying "Good job, Arnie"!!)

If CA suffers so, can you imagine what some of the more blue collar towns/states are undergoing?! Earlier this morning I saw a slideshow of pictures from Cleveland. Its not been a prospering city anyways (was #4 in most miserable cities list recently compiled by Forbes) but some of the pics of foreclosed and abandoned houses in that slideshow were really wretching! Also, see this slideshow: The American Economy: Down and Out.

P.S. The Freakanomics blog had a contest for a new six-word motto for the U.S

Here are the six finalists:
1. Consumption’s the Cure That Ails Us.
2. We Will Get It Right, Eventually.
3. We Are Too Big to Fail.
4. The Streets Are Paved With CASH4GOLD.COM.
5. Learn to Live Within Your Means.
6. Wow, Can You Believe This Place?

“It’s not a certainty, but it’s possible”

An interesting dialogue with Obama about his tussle with the Republicans over the stimulus bill, courtesy Bob Herbert's op-ed piece in the NYT.

“Now, I have to say that given that they were running the show for a pretty long time prior to me getting there, and that their theory was tested pretty thoroughly and it’s landed us in the situation where we’ve got over a trillion-dollars’ worth of debt and the biggest economic crisis since the Great Depression, I think I have a better argument in terms of economic thinking.”

He also made it clear that he won’t let his desire for bipartisanship undermine important initiatives. “I’m an eternal optimist,” he said. “That doesn’t mean I’m a sap.”

Bob goes on to write:

He was relaxed and had complete command of a range of complex issues, including the troubled banking sector, health care reform and the need to do more in terms of innovative education initiatives. But beyond his specific policies (and whether one supports them or not), Mr. Obama is emerging as the very model of the type of person one would want in high public office. He is intelligent, mature, thoughtful, calm in the face of crises and, if the nation is lucky, maybe even wise. 

Indeed! Just what the doctor would have ordered for this ailing nation. There's more good stuff in the article:

When asked about the sharp drop in the stock markets after Treasury Secretary Tim Geithner announced an expanded bank bailout plan last week, Mr. Obama replied:
“I am not planning based on a one-day market reaction. In fact, you can argue that a lot of the problems we’re in have to do with everybody planning based on one-day market reactions, or three-month market reactions, and as a consequence nobody was taking the long view.

“My job is to help the country take the long view — to make sure that not only are we getting out of this immediate fix, but we’re not repeating the same cycle of bubble and bust over and over again; that we’re not having the same energy conversation 30 years from now that we had 30 years ago; that we’re not talking about the state of our schools in the exact same ways we were talking about them in the 1980s; and that at some point we say, ‘You know what? If we’re spending more money per-capita on health care than any nation on earth, then you’d think everybody would have coverage and we would see lower costs for average consumers, and we’d have better outcomes.’ ”

Amen to that!

Near the end of the interview, the president said that there are certain moments in history when significant change is possible.

“It’s not a certainty,” he said, “but it’s possible.”

He said he believed that it’s very difficult for any single individual to actually set that kind of “momentum” for change in motion. But when that historical wave is there, he said, “I think you can help guide it.”

When asked if we are in one of those moments now, he said, “Yes. I firmly believe that.” 

Bob Herbert, like me, is by all means, a big O-fan and yet, given that its been only a month (less!) since Obama took office, I think its a bit too early to celebrate Obama's wins or by the same token talking about "the shine coming off"!!

Thank you, Wall Street

Economists Try Target Practice in a Fun-House Mirror

“Everybody does it,” is what high school students say when caught committing an offense. And now that the economy has plummeted, it’s the defense offered by lenders, borrowers, brokers, investors, credit agencies, government regulators and elected officials alike. Everybody was doing it, and nobody wanted to stop it. As Michael Francis, a former Wall Street investment banker puts it in “House of Cards,” a documentary on CNBC on Monday, “No, there was never a time where somebody said: ‘Hey, hold on. Let’s not do this.’ ”

It seems New Yorkers, some of whose "only experience with an economic downturn was when share prices for Google began to slip" also feel the heat. Read, perhaps with a little bit of schadenfreude: 

 
Economists’ Forecast for New York - Chance of Change 100%

An unemployment rate of 7.4 percent in December, compared with 5.1 percent two years ago. A projected hemorrhaging of 294,000 jobs — 46,000 from Wall Street alone — by the summer of 2010. A 41 percent drop in condominium sales from 2006 to 2008, and a 58 percent plunge for multifamily homes. A city budget deficit of $4 billion this year, and as much as $7 billion the next. And a mayor who is demanding that city employees pay 10 percent of their health care costs — or else risk losing their jobs.

With each passing hour, it seems, the avalanche of bad economic news, forecasts and anecdotes continues.

And so it goes....endlessly spinning out of control.

Suck us into a black hole

So how much is this big # Paulie (has he-who-shall-not-be-named said "Good Job, Paulie" yet?) pulled out of God-knows-where!

SFGate article had this to say:

Relax, people, it's just a number.

It's just a bunch of zeroes. It's merely 700,000,000,000, and if you look closely and blur your eyes just right and then hit yourself in the face with a brick, you'll soon see that each and every one of those cute little circles is filled with goodness and candy and the sweet sighs of puppies and pie. Really, what could such a ginormous number possibly mean to everyday hard-workin' plebes like you and me?

He actually has some serious points to make after that ...but I'll read it later.

Another guy, whose post has a few examples of what it equals, wrote:

Big numbers are hard for people to process. 700 billion can start to sound like 300 billion, or 900 million for that matter. It becomes like sand grains or moon strands, magically big, past the point of counting; an amount you sit with a nephew and contemplate in wonder. Or, if you're rushing through the paper, "a whole lot."

Yeah... its "a whole lot" and who has time to read all these long articles. (There are articles and views galore from all kinds of 'experts' on how we got into this mess, how to get out of the mess, and why the "bail-out" is bad for the common man... but who has the time to read all these articles!)

Well...a picture, they say, is worth a thousand words:

So, this should give you an idea: http://bigpicture.typepad.com/comments/files/marsh-1260x1681.jpg

$1.2 trillion for the Iraq war...$700B for salvaging banks.... nice way to spend my (and your) tax-money, people!

Depressing! Back to some frivolousness (how else does one deal with this madness and the absurdities but with humor, satire and frivolousness?

As Jon Stewart reminds us, $700 billion is equal to "around 2,000 McDonald’s apple pies per American."

And this from Vanity Fair* ...How Much is $700 Billion Really Worth? (Yeah, baby... 100 Large Hadron Colliders is what we need. This article is where I got the title of the post. We all know what happens if you get sucked into a black hole! Americans are being stretched thin, our vision is distorted, there is no escape -- we'll all end up eventually shredded apart... but for now, enjoy the ride!)

This which reminded me of an exercise we did for 5th graders in a school outreach program I was involved in at work last year. One of the volunteers did a presentation on how much is $1 million. 1 question was how tall would it be, in $1 bills, if piled one on top of the other. ....(and the guy related it to the Prudential, 2nd tallest building in Boston.)

* No.. I do NOT read Vanity Fair. I landed there while reading the Paul Newman article, mentioned here.

Screwed-up bail out

Wow... i missed this. Too distracted by other things, I have not read the details of the bail-out except to know they poured a whole lot of my (and other tax-payers) hard earned money into these financial institutions, trying to cover up the mistakes, greed, and incompetence of people who sometimes enjoyed bonuses 2-3x my annual salary (and I get paid well!)

But this is great! So what these same people are saying to the American public is: "We screwed up, you unscrew it,* then maybe we'll screw u again, making more money for ourselves in the process."

Finance industry lobbyists tried to stop lawmakers from limiting executive salaries at bailed-out companies, and fought to get their companies hired to control the assets that the Treasury will oversee.^{25 26} - via Harper's Weekly Review this week.

* He's not my representative^ but obviously, I was influenced by his insightful statement here :)

“The private market has screwed itself up, and they need the government to come help them unscrew it.” - said Representative Barney Frank (D., Mass.), Chairman of the House Financial Services Committee.

BTW, wiki enlightens:

In 2003, Frank opposed Bush administration and Congressional Republican efforts for the most significant regulatory overhaul in the housing finance industry since the savings and loan crisis. Under the plan a new agency would have been created within the Treasury Department to assume supervision of Fannie Mae and Freddie Mac, the government-sponsored companies that are the two largest players in the mortgage lending industry. "These two entities, Fannie Mae and Freddie Mac, are not facing any kind of financial crisis," Frank said. He added, "The more people exaggerate these problems, the more pressure there is on these companies, the less we will see in terms of affordable housing."^[28]

So, Bush administration had proposed that the Treasury Dept. should take over Fannie & Freddie 5 years back? Well...he got his wish!!

^ He's the 4th district representative, I'm in the 7th and Cambridge nearby is in the 8th..... I HAD to check, u know...to see if the guy who said this was representing me! :)

FAQ the Stimulus

Salil Tripathi pointed out via email that Steve Levitt of Freakanomics fame has a good guest blog post today about the current financial crisis.

As an economist, I am supposed to have something intelligent to say about the current financial crisis. To be honest, however, I haven’t got the foggiest idea what this all means. So I did what I always do when something related to banking arises: I knocked on the doors of my colleagues Doug Diamond and Anil Kashyap, and asked them for the answers. What they told me was so interesting and insightful that I begged them to write their explanations down for a broader audience.

Go to the Freakanomics blog link above for the "F.A.Q.’s of Lehman and A.I.G." .... its a really long post (with almost 200 comments already) but may be worth reading to understand all that has happened! Admittedly, its a tangled web and despite reading a lot of different articles, I am not sure I understand everything that was done by some rather unscrupulous and greedy people. It is too much for me to read now, with the clock having gone past the midnight hour, but I've bookmarked it and hopefully will get back to it soon!

However, from the above post, I was lead to another guest post at the Freakanomics blog.

AIMRco, the Adult Internet Market Research Company issued a press release earlier this month claiming that, based on a survey of an unspecified number of adult entertainment websites, “many sites have experienced between a 20 to 30 percent growth in membership rates since mid-May when the [stimulus] checks were first sent out, and typically the summer is a slow period for this market.” The release goes on to quote the spokeswoman for an adult website which fielded a survey of new members, revealing that 32 percent of respondents “referenced the recent stimulus package as part of their decision to either become a new member, or renew an existing membership.”

HILARIOUS! This is NOT what Bush meant when he gave away the "stimulus" package :)

A tangled web we weave

Though I have been following the spin-out in the financial markets, I do not necessarily understand all the reasons why we landed in this mess (very few do.) (It is easy to blame the rather amorphous and omni-present "greed" or if you have leftist/socialist leanings, you can blame "capitalism" and "free markets" itself!)

However, it is scary to think that even the so-called experts and the men in charge at the Treasury and the Federal Reserve, let alone politicians who can give us only rhetoric, arguably have no idea how to prevent such a disaster from happening again. I say that based on this excerpt from a NYT article:

“I fear the government has passed the point of no return,” said Ron Chernow, a leading American financial historian. “We have the irony of a free-market administration doing things that the most liberal Democratic administration would never have been doing in its wildest dreams.”
..
“It’s pure crisis management,” Mr. Chernow said. “It’s the Treasury and the Federal Reserve lurching from crisis to crisis without a clear statement on how financial failures will be handled in the future. They’re afraid to articulate such a policy. The safety net they are spreading seems to widen every day with no end in sight.”

Of course, we need to get out of the current mess before we worry about how to avoid it again!

It is scary when the predictions of even the most pessimistic of guys - Nouriel Roubini, economics professor at NYU's Stern School - who was dubbed "Dr. Doom" recently in the NYT, come true, no?

The broker/dealer business model is "inherently unstable" and the four remaining major firms will not be independent in a few years, says Nouriel Roubini, economics professor at NYU's Stern School and chairman of RGE Monitor. Embattled Lehman Brothers is likely to seek a buyer "within months," Roubini says. Lehman Brothers ceasing to be independent is not such a shocking outcome, but Roubini ultimately sees a similar outcome for Goldman, Merrill Lynch, and Morgan Stanley. - via (link has video interview with him)

This article in Business Week says "he predicted back in February that one or two major broker dealers would go bankrupt and now believes all of them will eventually disappear."

"If Lehman does not find a buyer over the weekend and the counterparties of Lehman withdraw their credit lines on Sept. 15 (as they all will in the absence of a deal) you will have not only a collapse of Lehman but also the beginning of a run on the other independent broker dealers (Merrill Lynch first but also in sequence Goldman Sachs and Morgan Stanley and possibly even those broker dealers that are part of a larger commercial bank, i.e. JPMorgan and Citigroup.)," Roubini wrote on Sept. 13 in his blog, Nouriel Roubini's Global EconoMonitor. " Then this run would lead to a massive systemic meltdown of the financial system."

Oh what a tangled web we weave!

--
"Oh what a tangled web we weave,
When first we practice to deceive"
- Sir Walter Scott

When it rains, it pours

The bad news keeps coming...

Home Prices Fall in May; Consumer Confidence Flat

Fed sees slower US economic growth amid higher price pressures

The Bush administration on Monday plans to project the U.S. budget deficit will soar to a new record of nearly half a trillion dollars in fiscal 2009 as the economic outlook darkens ...

White House downgrades US economic growth for 2008 and 2009

Sigh! And all that news is just in the last week (One article is a week old; others are from the last 2 days.)

He's going to need all the help he can and a big dose of 'audacity' and 'hope' in addition to a big wallop of good luck to go with it!

Buffett joins Obama to solve economic crisis

Both Obama and McCain focus on the economy this week.... time for more fuzzy math and blame-games!

Boom time for the global bourgeoisie

And speaking of boom-times, even as we here in the US "whine" about the US economy, it's "boom time for the global bourgeoisie."

In the midst of the current widespread gloom and doom in the west, it is important not to lose sight of the true structural themes shaping our era. Linked to the current mood, commentators often depict an embattled and shrinking middle class, with sharply rising financial inequality. However, globally, this is simply not true. One of the most startlingly positive phenomena for many generations continues to unfold around the world. We are in the middle of an explosion of the world's middle class.

This may be news to people who have not visited India or China recently. From my exposure to India, it is definitely true about the middle and upper middle class in India. The Indian middle class is 'punch drunk' in a wave of prosperity, tempered only slightly by a sluggish stock market this year.

The article goes on to talk about BRIC economies - a topic of great interest to many who investment in mutual funds and ETFs. However, the article points out that this is a phenomenon which s not restricted to BRIC countries.

Middle-class citizens will appear in their millions in many other parts of Asia, central and eastern Europe, the Middle East and Latin America. This is a Bric-driven phenomenon, but the "next 11" are making their contribution and other nations will also participate.

This is a global phenomenon and is driven by globalization and the generation and redistribution of wealth it creates. (Yeah...yeah. We all know this. We've all read Friedman''s book 'The world is flat', right? In fact, I'd add that we knew all this even before he wrote the book. He just wrote the right book at the right time and got really famous doing it because in some ways, he said it out loud first and is hence (going to be) seen as a visionary; even if what he stated was obvious for anyone who was working and living in 1999-2003 and could have said all the same things if he thought a little bit about what was happening instead of just bemoaning 'outsourcing'.)


Anyways, do read the article. It contains some interesting data, for sure.

According to our calculations, the number of people living on incomes of less than $1,000 dollars a year ($2.75 a day) has already dropped significantly from about 50 per cent of the world's population in the 1970s to 17 per cent by 2000. According to our numbers, it could be as low as 6 per cent by 2015. On the more familiar World Bank defin-ition of one dollar a day, the same dramatic shift is evident. Probably no more than 5 per cent of the world's population now suffers this indignity. Of course, this is too much, but as long as the forces of globalisation continue we expect it to drop further.

Updated: Quite a few more articles on the subject recently.
One in the NYT (July 18th): Boom Times Take Root in Dubai
Another in WSJ Blogs (August 5th): Clean Tech: One Sector Is Bucking Global Economic Blues
and one more in NYT (August 12th): Cost-Cutting in New York, but a Boom in India


P.S. In reading up some other articles related to the above, I found this interesting related study about the spending and saving habits of Indians. It found that..

...people in India do not plan for long-term future and keep away from investing in long-term instruments though they save for long-term goals such as emergencies, education and old age.This phenomena is not just confined to just poor or middle-class households, but is prevalent in rich households too.

The survey reveals that most Indians prefer keeping 65 percent of their savings in liquid assets like bank or post office deposits and cash at home, while investing 23 percent in physical investments like real estate and gold and only 12 percent in financial instruments.

Damn...sounds like me! Can take the Indian out of India but not India out of the Indian! ;)

Of nominal stickiness and a package too small

Tyler Cowen writes:

Maybe it's a good thing the stimulus package is too small to be very "effective."

....

If nominal stickiness is not a major binding problem (and I suspect this is the relevant case), then even a single-country stimulus plan will be ineffective.

To the non-economist in me, the above lines did not mean much and in fact, all this talk of small packages and nominal stickiness induced an adolescent snicker or two - just like this cartoon did this morning.

But its a good discussion with arguments on why economic stimulus packages do not work.

Also read this other post by Tyler Cowen about onion prices and what they teach us about oil prices.

Onions have no futures market, yet their recent price volatility makes the swings in oil and corn look tame.

A couple other articles on relevant topics for the day but which I understand nothing about. (Why do I even blog about these topics when I won't even read the articles in their entirety and try to educate myself?)

Oil speculation: Why we don't have answers. There's a lot we don't know about how the oil futures markets now work. Congress should find out. (Also read about the "Destroyer of all worlds" and the man who lost $6 billion, Brian Hunter.)

The inflation showdown

Attempts at foreseeing catastrophes

I do not know if this makes sense to economists -- flame me not, if there be economists amongst my few readers I may (or may not) have -- but this seemed like an interesting observation, especially given the current economic downturn in the US.

The Polish poet Czeslaw Milosz, in his book, Milosz's ABC's, writes:

How fragile is the social organism; how easily its activity can be disrupted, I discovered in America, where at least since the sudden collapse of the market in 1929 people live as they do in California in relation to an earthquake: it could happen at any moment. There is no certainty that plans and intentions for the next year won't be suddenly thwarted. So it's no wonder that the science (or art?) of economics, which is based for the most part on attempts at foreseeing catastrophes, is highly valued, and that one can receive a Nobel Prize for it.

I sure know something about plans and intentions for the next year being thwarted. This year has been an example.

Buy! Buy! Buy!

David Brooks writes in the NYT about "the trampling of decent norms about how to use and harness money.

Sixty-two scholars have signed on to a report by the Institute for American Values and other think tanks called, “For a New Thrift: Confronting the Debt Culture,” examining the results of all this. This may be damning with faint praise, but it’s one of the most important think-tank reports you’ll read this year.

David goes on to list a number of reasons or the 'agents of destruction' who have played a role in making the American public "less socially conscious about money and debt." Strangely, he does not include what I consider the most important agent: the self. Personal responsibility comes first, no...before you starting blaming other causes that have merely supported this personal indulgence and irresponsibility.

By the way, you' have to BUY the report. Copies are $7.00 each. (Fair enough.. not an expensive report costing hundreds or even thousdands. And yet... there are many free reports that many organizations put out from time to time. Make it free, Institute of American Values!

Update: After reading Brooks' article some more I realized there is a nice summary of the report by Barbara Dafoe Whitehead in the American Interest, which is available for free online.

The European bogeyman (doesn't exist)

...or so writes Paul Krugman about the comeback continent - Europe.

I don’t want to exaggerate the good news. Europe continues to have many economic problems. But who doesn’t? The fact is that Europe’s economy looks a lot better now — both in absolute terms and compared with our economy — than it did a decade ago.

What’s behind Europe’s comeback? It’s a complicated story, probably involving a combination of deregulation (which has expanded job opportunities) and smart regulation. One of the keys to Europe’s broadband success is that unlike U.S. regulators, many European governments have promoted competition, preventing phone and cable companies from monopolizing broadband access.

What European countries definitely haven’t done is dismantle their strong social safety nets. Universal health care is a given. So are a variety of programs that support families in trouble, helping protect Europeans from the extreme poverty all too common in this country. All of this costs money — even though European countries spend far less on health care than we do — and European taxes are very high by U.S. standards.

In short, Europe continues to be a big-government sort of place. And that’s why it’s important to get the real story of the European economy out there.

According to the anti-government ideology that dominates much U.S. political discussion, low taxes and a weak social safety net are essential to prosperity. Try to make the lives of Americans even slightly more secure, we’re told, and the economy will shrivel up — the same way it supposedly has in Europe.

But the next time a politician tries to scare you with the European bogeyman, bear this in mind: Europe’s economy is actually doing O.K. these days, despite a level of taxing and spending beyond the wildest ambitions of American progressives.

Economics of Globalization

Have got the book, Making Globalization Work, by economist Joseph Stiglitz, who won a Nobel Prize in Economics in 2001, and hope to read it soon.

The Amazon.com publisher's blurbs have this to say about the book:

Stiglitz's seminal Globalization and Its Discontents (2002) argued that globalization has not benefited as many people as it could, a failure attributable to structural flaws in international financial institutions as well as limited information and imperfect competition. With this selection, the Nobel Prize-winning economist suggests a host of solutions by which globalization can be "saved from its advocates" and made safe and worthwhile for the poor and rich alike.

and

Stiglitz focuses on policies that truly work, offering fresh new thinking about the questions that shape the globalization debate, including a plan to restructure a global financial system made unstable by America's debt, ideas for how countries can grow without degrading the environment, a framework for free and fair global trade, and much more. Throughout, Stiglitz reveals that economic globalization continues to outpace both the political structures and the moral sensitivity required to ensure a just and sustainable world.

More about the book after I read the book as I think it is particularly relevant for India... especially in the context of making globalization work not for a select few but for the millions - afterall, the stark contrast of the successes of the minority taken forward due to the effects of globalization and those that are left behind (750 million of them!) is nowhere more evident than in India...

For now listen to a lecture he delivered in Chennai on Jan 4, 2007 and read this interview from November 2006 with the journal Oxonomics in which he calls for new forms of global governance and diagnoses some of the problems of the International Monetary Fund.

Also listen to this earlier lecture about "the questions that shape the globalization debate, including a plan to restructure the global financial system, ideas for how countries can grow without degrading the environment, and a framework for free and fair global trade."

Read this article by Stiglitz in NY Times -- How to fix the global economy

And lastly, there are many other links available through Wikipedia...

---

And for a counter-point from a big globalization advocate.. read this book review of In Defense of Globalization by Jagdish Bhagwati, also a faculty at Columbia University, like Stiglitz.

For more, see posts at the IHT maintained blog - Managing Globalization, which has Q&A sessions with Stiglitz, Bhagwati, and Jeffrey Sachs, another famous economist - Director of the Earth Institute at Columbia University & head of the UN Millennium Project, (read more at my post on "Fighting poverty & hunger.").

Economics as a guide to human behaviour

Interesting article - Pricing Caffeine by Amit Varma, who also blogged about it here. It is a review of The Undercover Economist by Tim Harford and I really loved the first sentence of Amit's blogpost: 

Art aims to reveal the human condition, but there is no better way to understand human behaviour than through the tools of economics.

Snared right away by a great title and even better starting line - always a good idea be it a book or a blogpost - I was intrigued and so I did a little search and found some other related links to discussions or books on the subject.

The Economic Approach to Human Behavior by Gary S. Becker

The New Economics of Human Behaviour edited by Mariano Tommasi (UCLA) & Kathryn Ierulli (Univ. of Illinois, Chicago). Foreword by Gary Becker

Of human behaviour and economics by B. Venkatesh, in The Hindu. Article in The Hindu:

Also read Richard Epstein's (author of Skepticism and Freedom and Professor of Law at the University of Chicago Law School & Peter and Kirsten Bedford Senior Fellow at the Hoover Institution, and a significant contributor to the theory of limited state powers) argument that

..embracing aspects of libertarian theory and laissez faire economics—continues to offer “the best guide to human behavior” and social organization. “Classical liberalism requires us to maintain the distinction between liberty and coercion: to advance the former while constraining the latter', says Epstein. Read the entire article...some real good thoughts and even good quotable quotes like - 'Skepticism is an essential component in maintaining freedom.'

In finding out more about Richard Epstein, I found this..

ON NSA SPYING: A LETTER TO CONGRESS by Beth Nolan, Curtis Bradley, David Cole, Geoffrey Stone, Harold Hongju Koh, Kathleen M. Sullivan, Laurence H. Tribe, Martin Lederman, Philip B. Heymann, Richard Epstein, Ronald Dworkin, Walter Dellinger, William S. Sessions, William Van Alstyne.

I also ran into an article by Epstein remembering Harvard University's John Rawls, widely regarded as the most influential political philosopher of the 20th century and author of A Theory of Justice (1971). The article references Robert Nozick, also of the Harvard philosophy department, and author of Anarchy, State, and Utopia (1974), which laid out a lot of the libertarian principles.