On the fourth day of Christmas...

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My true love sent to me: four calling (or colly) birds, which in A Partridge in a Pear Tree are said represent the four gospels or the four evangelists, Matthew, Mark, Luke, and John.

Well, my true love is now breaking the Animal Welfare Act 2006, which makes it illegal to sell wild animals. It also demands that animals are given a suitable environment, diet and housing.

Regulations proposed under the legislation tell pet owners not to feed their dogs chocolate or let their cats sit on the toaster. Although feeding your dog chocolate is not actually a criminal offence, it can be used in a court of law as evidence of your guilt on other charges, which can leave you open to a prison sentence of a fine of £20,000.

The Media's Top 10 Economic Myths of 2008 (No.4)

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4. Attack of the Killer Tomatoes

Media myth: A salmonella scare frightened everyone and upset one CNN anchor so much that he called for the impeachment of President Bush – but it turned out peppers were the culprit.

Originally published by the Business & Media Institute

CNN's Lou Dobbs, host of "Lou Dobbs Tonight," called for the impeachment of President George W. Bush on June 19, 2008 – but this wasn't about the Iraq war or some sort of atrocity. It was over tomatoes.

Dobbs placed the blame for the salmonella outbreak that had sickened 383 people by April 2008.

"You know, I have heard a lot of reasons over the years as to why George W. Bush should be impeached," Dobbs said. "For them to leave the Food and Drug Administration (FDA) in this state, its leadership in this sorry condition and to have no capacity apparently or will to protect the American consumer – that is alone to me sufficient reason to impeach a president who has made this agency possible and has ripped its guts out in its ability to protect the American consumer."

The media spread fear of tomatoes to the public. In the first four days of the scare – June 8 through June 12 – the three broadcast networks aired 20 stories hyping the salmonella outbreak and pointing the finger at tomatoes.

Ultimately, the misplaced blame cost the tomato industry at least $100 million according to an Associated Press story. The Food and Drug Administration later cleared tomatoes and found the true culprit of the Saint Paul salmonella outbreak: jalapeno or serrano peppers.

Film of the Year No. 4

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4. Changeling

Who would ever have thought that Clint Eastwood, once Hollywood’s drifter/cowboy/anti-hero par excellence, would also become one of America’s most celebrated directors? And yet his recent filmography – Mystic River, Million Dollar Baby, Flags of Our Fathers, Letters from Iwo Jima – really says it all. He still appears to be improving with age though, since his latest effort, Changeling, is undoubtedly his best to date.

The (true) story centres on Christine Collins (Angelina Jolie), a single-mother in 1920s Los Angeles who comes home from work one day to find her young son, Walter, has disappeared. Some months later the LAPD (seemingly mired in prohibition-era corruption) find a child and claim it is Collins’ son. It isn’t. But when Collins’ tries to tell the police that they turn against her, insisting she is mentally unstable and an unfit mother. But what happened to the real Walter? Can he be found before it is too late?

Changeling is flawless cinema, and it would be surprising if it did not feature heavily in 2009’s Oscars. Jolie is superb, and Eastwood’s classical style and mastery of tone and atmosphere makes Changeling reminiscent of Roman Polanski’s 1974 masterpiece Chinatown – high praise indeed. It may sound like mere melodrama, but the narrative shift that occurs part way through the film turns Changeling into something altogether darker and more disturbing. It’s still showing in cinemas, so be sure to catch it if you can. Watch the trailer here.

Blog Review 822

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Looking at charts of industrial output makes some think that this is the Great Depression Part II. Others think that looking at industrial production isn't all that important or informative.

The idea that government action opened up opportunity and competition is so ahistorical as to be breathtaking....

Something we forget at our peril, voluntary transactions benefit all of the participants in them.

The last time the government started throwing money around like a drunken sailor there was no corruption, oh no. But it does rather matter what you consider to be corruption.

Some thoughts on not spending money like a drunken sailor.

Rough figures, but some individual blogs seem to be getting about 15% of the web traffic of national newspapers.

And finally, the turth in a quiz answer.

On the third day of Christmas...

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My true love sent to me: three french hens, which in the song apparently represent the theological virtues of faith, hope, and charity. I'm not sure there is much of any of them around today, though.

On the faith side, we might be making progress. Dorothy Glenn of South Shields was told by her Housing Association to remove her four-foot Santa and Christmas lights in case it offended non-Christians. However, her non-Christian neighbours said their kids loved the lights, the Council repudiated the demand, and the Housing Association was forced to apologise. Councillor Ahmed Khan, who represents Mrs Glenn's ward, commented: "It's this kind of nonsense that sets race relations back twenty years." Quite.

As for hope, well, I don’t hold out much hope for our economy in 2009. And charity: it's remarkable how many things that should be done through charity are in fact done through coercion as government takes money out of our pockets to do them. And then take the credit, of course.

The trouble is, that when governments intervene, private funding dries up. The Royal National Lifeboat Institution found that in the 1800s, when it started to accept government money. It found that for every £1 it took from the government, it lost £1.40 in private donations. People couldn't see why they should fund something that the government was paying for. Now the RNLI proudly refuses all government money. Bravo!

The Media's Top 10 Economic Myths of 2008 (No.5)

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5. The economy has a fever and the only prescription is more bailouts.

Media myth: From the economic stimulus early in 2008 to the call for a Big Three auto bailout in December the media couldn't find a bailout it disliked.

Originally published by the Business & Media Institute

Bear Stearns, AIG, Fannie Mae and Freddie Mac. 2008 was the year of the government bailout and the news media supported such interventions time and time again.

One particularly vocal advocate for bailouts was CNBC's Jim Cramer who warned that without a financial bailout the U.S. could face a second Great Depression. He said the same thing months later about an auto industry rescue. Before AIG was given a loan package from the Federal Reserve, Cramer warned that the company absolutely "cannot fail."

When public opinion was turned against the $700-billion bailout CNN correspondent Carol Costello admitted that the network's experts were confused. Costello said, "I talked to our own polling experts and they are perplexed by the numbers" which showed a majority against the bailout.

The $25 billion housing bailout of Fannie Mae and Freddie Mac was also embraced by the media. "CBS Evening News" called the bill a "lifeline" for the government-sponsored enterprises, but correspondent Jim Axelrod didn't explain that the "unlimited capital from the government" would come from taxpayers.

But Jerry Bowyer, the chief economist for the Benchmark Financial Network, criticized the Fannie/Freddie bailout: "It's bad in the short run, unless you are either a highly paid Fannie executive or currently a staffer for any Democratic member of a Congressional Banking Oversight Committee, in other words, a future highly paid Fannie execute [sic]," Bowyer wrote. "In the long run, this will be a huge transfer of wealth to a corrupt bureaucratic and inefficient bureaucracy from the rest of us tax payers."

Bowyer and other free-market economists have criticized the many bailouts, but their perspective was rarely included in bailout stories.

Film of the Year No. 5

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5. The Orphanage

Laura grew up in an orphanage, but was later adopted. Years later, she and her husband Carlos buy the orphanage – which has since fallen into disrepair – and move in with their own adopted son, Tomas, intending to reopen it as a home for handicapped children. Before long, Tomas starts to communicate with an invisible new friend, who may be just a product of his young imagination, but could be something altogether more sinister...

The Orphanage is everything a horror film should be. Unlike most recent examples of the genre – which tend to rely almost exclusively on gore and extreme violence to unsettle the viewer – The Orphanage puts story and atmosphere first, scaring us with the unknown and the unseen, and connecting with the audience on a deeper, more psychological level. Ultimately, that makes it all the more terrifying.

Too often, films like this fall at the final hurdle, failing to deliver on the suspense they have built-up. Not so here: what makes The Orphanage transcend it genre is the knock-out blow it delivers in its final act, a brutal and unexpected twist that lingers in the mind long after the credits have rolled. Highly recommended.

Watch the trailer here

Blog Review 821

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An interesting thought to lead into the New Year. If only economists were as arrogant as everyone thinks economists already are.

Another one (and very much Deepak Lal's view, he who is one of our Fellows here), that governments are in essence glorified gangs of criminals.

And a cynical if true view of how philanthropy works out in practice.

The man who predicted the future of the American car industry.

Too much time on your hands? See if you can beat Netsmith's donation of 303 glasses of water to those who need it.

Another charitable effort that could use some help and attention. Time, money, even stocking fridges with beer......

And finally, we'd have gotten' away with this if it wasn't for those pesky students. 

On the second day of Christmas...

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My true love sent to me: two turtle doves. In the original it seems that the turtle doves represent the Old and New Testaments of the Bible.

Pigeon fanciers were outraged after HM Revenue & Customs (HMRC) left pigeon racing out of the official list of sports. They asked the Queen, who is patron of the Royal Pigeon Racing Association (RPRA), to get this ruling reversed, and organized an e-petition to Downing Street. Why so many ruffled feathers about something apparently so trivial?

Well, it's all about money. Premises used for 'sports' are exempt from the rates, a local-authority tax. Under MHRC proposals to introduce rates on sports clubs and village halls, groups can formally apply for dispensation from HMRC for 80% relief and then to their local authority for a 20% reduction. So pigeon fanciers faced paying rates on their sheds, though officially recognized sports such as yoga, arm-wrestling and trampolining are still exempt.

The government told the e-petitioning pigeon fanciers that decisions on which activities count as ‘sports’ were made by agreement of the sports councils, and it would be inappropriate for the government to intervene. Doesn't it all speak volumes about just how silly and bird-brained all these tax rules are?

The Media's Top 10 Economic Myths of 2008 (No.6)

NBC's Anne Thompson noted on the March 12 "Nightly News" that higher energy prices would be good for alternative forms of energy like solar and wind power, which can cost two to four times as much as coal and oil.

Two scientific studies have suggested clearing land to produce biofuel ingredients will actually contribute more to "global warming" than simply sticking with fossil fuels. The shocking part is that someone in the media actually reported it!

The findings "could force policymakers in the United States and Europe to reevaluate incentives they have adopted to spur production of ethanol-based fuels," The Washington Post's Juliet Eilperin reported February 8. "President Bush and many members of Congress have touted expanding biofuel use as an integral element of the nation's battle against climate change, but these studies suggest that this strategy will damage the planet rather than help protect it."

We're talking about big differences, too. One study out of Princeton found that "over 30 years, use of traditional corn-based ethanol would produce twice as much greenhouse gas emissions as regular gasoline" in part due to the removal of trees that help reduce carbon.

Researcher Tim Searchinger estimated "it would take 167 years before biofuels would stop contributing to climate change."

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6. Alternative energy: All gain, no pain

Media myth: According to journalists, the only way out of high gas prices and global warming are expensive, impractical "green" fuels.

Originally published by the Business & Media Institute

Rather than give an even-handed report on the oil supply situation, many journalists continued to push the "green" theme in 2008, calling alternative energies "a surefire way to cut fuel costs" and saying that a fuel other than gasoline would be "a welcome relief," despite the trillions of dollars and number of years that may take.

In June, CBS "Evening News" stacked a story against drilling on the very night a poll came out showing public support for increased drilling. Correspondent Bill Whitaker cited "bipartisan" opposition to offshore drilling "in California, which suffered a devastating oil spill from a rig off Santa Barbara in 1969." But he didn't balance his own story evenly with proponents and opponents; instead he promoted the "green" views of environmentalists and Gov. Arnold Schwarzenegger.

NBC "Nightly News" consulted CNBC's Erin Burnett on June 22. Burnett acknowledged the oil supply problem, saying "a lot of people want oil, and we don't seem to have enough." But she never mentioned increasing domestic supply by allowing offshore or ANWR oil exploration.

Instead, Burnett said, "We have to take our lumps, pay these prices and invest aggressively in alternative fuels that we can have right here in the United States of America. We get 15 percent of our power from right now from nuclear energy. We could dramatically increase that. We have other sources as well that are plentiful here at home like wind, like coal. We need to invest in those."

Burnett wasn't the first journalist to cheerlead for alternative energy development. "For anyone with a fresh idea, expensive oil is as good as a subsidy – with no political strings attached," Wired.com contributing editor Spencer Reiss wrote in December 2005. "And smile when you see a big black $3 or $4 out in front at the gas pump. Those innovators need all the encouragement they can get. Shale oil, uranium, sunlight – there's enough energy out there for a dozen planets."

Alternative forms of energy are less efficient and usually less attractive to an open market than oil and coal. [Click 'read more' to continue]