Why the U.S. is spending $1 trillion on nukes

Michael Corones
Oct 21, 2014 15:59 UTC


Here’s a fun post to take your mind off Ebola and Washington’s myriad foreign policy problems.

A mere five years ago, in the announcement awarding President Obama the 2009 Nobel Peace Prize, the Norwegian Nobel Committee said it “attached special importance to Obama’s vision of and work for a world without nuclear weapons.”

So for many, the Sept. 21 New York Times Headline, “U.S. Ramping Up Major Renewal in Nuclear Arms“, seemed, err, at odds with the hope and change we’d been promised.

What’s going on? Could there be a pragmatic explanation, or is this just good, old-fashioned bloodthirstiness?  Adam Mount at the Council on Foreign Relations calls the administration’s record on nuclear issues “deeply ambivalent,” but explains that the nation’s nuclear arsenal is becoming obsolete and that ”the United States is preparing to upgrade nearly every bomber, submarine, missile, and warhead in the arsenal in the next decades.” This modernization, he adds, “will drive the cost of the arsenal 75 percent higher in the next ten years than the last, and up to $1 trillion over the next thirty years.”

As this Reuters graphic shows, the Congressional Budget Office estimates the 10-year costs of maintaining and modernizing our existing arsenal at $355 billion, with another $215 billion slated for “other nuclear-related activities.”

The Times story reveals some pretty alarming anecdotal details about our crumbling nuclear facilities, but National Nuclear Security Administration numbers quantify the scope of the problem:

  • 43,000 employees spread over eight weapons facilities
  • 2540 total lane-miles of paved roads—nearly the distance from Washington, D.C. to Los Angeles
  • 275,000 total lane-miles of unpaved roads—enough for 11 laps around the equator
  • 8,000,000 miles of fencing—enough to encircle the D.C. Beltway 24 times
  • 2160 square miles of land—about the size of Delaware
  • 38.5 million square feet of facility space—six Pentagons worth
  • 9.5 trillion BTUs of energy consumed annually—enough to power 250,000 homes
  • 15.2 million square feet of hazardous materials—enough to fill 15 Washington Monuments

So while it’s true that a trillion dollars over thirty years sounds aggressive, the silver lining is that much of that money is going to ensure that our decaying infrastructure doesn’t harm Americans on their own homeland.

See, now Ebola and ISIS are the least of your worries!







What could be sweeter than sugar?

Michael Corones
Oct 20, 2014 19:35 UTC

A Yiddish proverb says, “Don’t be too sweet lest you be eaten up.” If only.

The top sugar brand in the United States, Domino Sugar, has announced it is joining the diet bandwagon by launching a no-calorie, “natural” sweetener line extracted from Paraguay’s  stevia plant.

Last month, the three biggest soda companies in the U.S., Coca-Cola, PepsiCo and the Dr Pepper Snapple Group, proposed an initiative to reduce the number of calories consumed in sweetened drinks by 20 percent by 2025.

What’s happening here? A crisis of conscience among Big Food execs? A case of companies biting the hands that gorged them with profits? Isn’t it our God-given right to slowly consume ourselves to death while freaking out about Ebola?

Not surprisingly, the answer makes more business sense than that. As this Reuters graphic shows, “natural” sweetener stevia is growing in popularity and expected to enjoy a further bump in market share in coming years. At the same time, Americans’ taste for caloric sweeteners has fallen off considerably since a peak in the late-1990s, apparently owing to more responsible decision making by consumers.

The science, of course, is still far from perfect.  But if researchers are still uncertain about just how healthy non-caloric sweeteners may be, the bottom line is far clearer. Domino President and CEO Brian O’Malley gives a pragmatic—if cynical—interpretation of the change in heart: ”If you look down the sweeteners aisle at any supermarket, there are stevia products there. Whatever consumers are looking for, we want to provide.”

Still, only 1.5 percent of new food products launched in the first nine months of 2014 contained stevia.  As long as it’s so hard for chemists to re-create the taste of real sugar, change surely will flow like molasses.





Should bankers get bigger bonuses?

Michael Corones
Oct 17, 2014 16:45 UTC

As F. Scott Fitzgerald was famously kind-of quoted, “The rich are different than you and me.”

Morgan Stanley reported strong third-quarter earnings today, up 12 percent to $8.91 billion in quarterly revenue, while rival Goldman Sachs yesterday reported an increase of 25 percent to $8.39 billion.

As this Reuters interactive shows, the share price for both investment banks healthily beat the S&P 500, with Morgan Stanley’s earnings per share coming in at $0.84 and Goldman’s boasting an EPS of $4.69.

If there’s any bad news—and bad is a relative term here—it’s for bankers at the two financial titans, as both credit restraint in compensation (aka, flat bonuses) for helping earnings growth. Reuters’ Lauren Tara LaCapra reports that similar changes to bonuses are taking place across Wall Street. Still, Goldman estimated its average compensation per employee at $320,000 or the first nine months of the year.

Somehow I don’t think Joe Sixpack—or F. Scott Fitzgerald, for that matter–are shedding any tears.


JulyAugustSeptember0510%Goldman SachsMorgan StanleyS&P 500$5.00SELECT:REVENUENET INCOMEBASIC EPSSep ’13Dec ’13Mar ’14Jun ’14Sep ’14Goldman SachsMorgan Stanley

Bankers should get no bonuses. Are they some special type of class of people? They only use other people’s money.

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Employers shouldn’t freeze women’s eggs

Michael Corones
Oct 16, 2014 15:59 UTC

You know something’s hit a mainstream nerve when the Onion gets in on the act. 

On Wednesday, “America’s Finest News Source” ran a satirical article under the headline “Facebook Offers To Freeze Female Employee’s Newborn Children.” For the uninitiated, NBC News started a spirited debate on Tuesday when it reported that in January, Apple will join Facebook in paying for female employees to freeze their eggs.

The issue for some is the motivation behind the perk, and whether it is merely a guise to get women to spend their prime childbearing years in the office instead of making more holistic decisions regarding their work-life balance. As Emma Barnett writes in the Telegraph, “professional women have already got enough on our plate without our ‘benevolent bosses’ suddenly playing God.”

But as this Reuters graphic shows, this is hardly the first instance of technology firms using extra healthcare benefits to attract workers. A survey of 103 high tech companies showed that for a dozen deluxe benefits, tech outfits out-offer the national baseline for all industries.

Ultimately, freezing eggs is a woman’s personal decision, but in the tech sector particularly, gender inequity—and frightening threats like #Gamergate–are no laughing matter. That’s what makes the Onion’s frozen babies headline so biting.







Frankly… I would love for a news agency to ask a real professional their opinion for once, instead of going to the one person on their staff with an M.D. at the end of their name.

Freezing eggs has nothing to do with enabling women to work longer. For those that don’t know, there are a lot of women out there that are simply at a higher risk for pregnancy. Just go look up High Risk OB/GYN.

Freezing Eggs is extremely expensive, and is typically reserved for women who find out that their egg supplies are abnormally low. But they’re also used for women who might need to undergo risky procedures such as Chemotherapy, or when they need to have their ovaries removed. Freezing eggs is often a last resort for a woman to become a mother, or a couple to become a family. And the way most insurance policies are structured, it is rarely covered.

But lets not talk about all of the logical reasons why. I’d much rather read or listen to so middle-aged man’s opinion based solely on the assumption that Mark Zuckerburg and all of the other Tech CEO’s sat in a room one day trying to figure out how they can keep women from getting pregnant while working for them.

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Finger pointing doesn’t bring back Iraq’s dead

Michael Corones
Oct 15, 2014 16:34 UTC

Last night The New York Times released an astounding report detailing the U.S. military’s discovery and subsequent cover-up of secret caches of chemical weapons in Iraq from 2003 to 2011. 

Almost immediately, partisans on the right took to the Web to vindicate President Bush’s justification for the 2003 invasion, and just as quickly, those on the left rebutted the assertion.

The National Review Online’s Patrick Brennan splits the middle, pointing out, “The existence of these weapons doesn’t affect the debate over the war’s justification either way” as it doesn’t prove that Saddam Hussein was resuming production of weapons of mass destruction, while it does show that he was not complying with the mandate to destroy existing weapons and allow UN inspections.

There can be little debate that Iraq has been in a near-constant state of catastrophe since the invasion. As this Reuters graphic shows, more than 140,000 civilians have been killed since March, 2003, with the recent carnage wrought by the Islamic State driving levels to their highest since the peak of sectarian violence in 2006 and 2007.

At this point, the reality for millions of Iraqis recalls a grim interpretation of the Van Morrison lyric: “It ain’t why, it just is.”




‘There can be little debate that Iraq has been in a near-constant state of catastrophe since the invasion.’

True – all because the bush/GOP had NO PLAN for the aftermath of their invasion. And since the Republicans had both houses and the Presidency then and many of the GOP reps that enabled the whole Iraq disaster are still in office, the whole thing is squarely on them.

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A different kind of cold war

Michael Corones
Oct 14, 2014 15:58 UTC

Ukraine is getting the cold shoulder from Russia on two fronts, and that could be bad news for Europe.  As if the military conflict between pro-Russian separatists and Ukrainian forces weren’t enough, tensions over unpaid gas bills remain high. Russian energy giant Gazprom cut off supplies of gas to Ukraine in June after Kiev failed to pay $3.1 billion in gas debt, but this is more than just a Ukrainian problem. The European Council on Foreign Relations succinctly frames the issue:

“The impending crisis illustrates Europe’s dependence on Russian gas and the near-monopoly Ukraine has on the transit of gas to Europe. This means when Russia limits or cuts off Ukrainian gas, it becomes a European problem because Ukraine then siphons off Russian gas destined for European customers.”

As this Reuters graphic shows, Ukraine’s gas reserves are just over half full, and a half-dozen other countries are reliant on Russian gas exports for at least 50 percent of their consumption. While Norway’s Statoil recently struck a deal to sell Ukraine gas, a Statoil spokesman called the deal “a short-term and relatively low-volume agreement.” Russia is also trying to resolve the dispute by offering Ukraine a more flexible payment schedule for overdue natural-gas supplies. Talks between Russian Energy Minister Alexander Novak, Ukrainian Energy Minister Yuri Prodan and EU Energy Commissioner Guenther Oettinger are scheduled to resume in Berlin on Oct. 21, and an agreement can’t come quickly enough. As Gazprom CEO Alexey Miller astutely pointed out: “The winter will be cold.”




Thank god for the fracking boom, which will flood the world with oil & natural gas and drive the prices down. Putin will no longer have the option to threaten people with freezing during the winter so he can make more progress in reestablishing the former Soviet empire.
Putin will have no more money to spend on his insane military build up either.
The Russian government did enough damage to the world in the last Cold War with it’s dreams of empire. The world does not want another.

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The problem with going back to work

Michael Corones
Oct 13, 2014 16:34 UTC

Some silver clouds have gray linings.

On the surface, the most recent U.S. jobs report brought good news, with the unemployment rate falling to a six-year low of 5.9 percent.

But the news isn’t all rosy. The number of Americans on the outside of the labor force looking in hit 13,346,000 in September, a high since the December, 2007, start of the Great Recession. The graph of those not in the labor force is disturbingly parallel to the trend of recovery in non-farm payrolls.

Further, the number of underemployed, while steadily improving, remains frustratingly high, with 7 million people working part-time out of necessity, and the number of unemployed, marginally attached and part time workers at 11.8 percent.

The news is even more bleak for black and Hispanic workers, who are suffering unemployment rates of 11 percent and 6.9 percent, respectively.

For workers on the margins, little wonder this recovery hasn’t felt much like a recovery.


Still slaving away at 40% below my salary at the time George II got his mitts on the economy and the Wall Street Casino blew up. But as the old saying goes it is a “lot better than a stick in the eye”.

However I am someone more than PO’ed that the government counts me as a “victory”, like they have won something – well they have gained a much-lower spending consumer (not contributing much to the ‘consumption’ economy and paying much lower taxes). They forgot in their statistics to include a statistic for “working victims” alongside the “discouraged workers” of the ought decade’s economic “policies”.

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Who gets what for Ebola relief

Michael Corones
Oct 10, 2014 16:28 UTC

Really, this isn’t funny. This week funnymen Jon Stewart and Stephen Colbert both lampooned the American media’s frenzied coverage of Ebola in the U.S., but in West Africa it is still a catastrophe in the making–with a very real chance that estimates of seven-figure death tolls will become reality.

The world community’s reaction to the outbreak has been late and lax—never underestimate a congressperson’s ability to play politics in an election year—but the urgency of the situation is finally dawning on world leaders who are now scrambling to bolster the effort.

As of yesterday, $740 million in assistance had been contributed—just under a quarter-billion dollars short of the $987.8 million goal outlined in the World Health Organizations’s Ebola response roadmap.

This Reuters graphic outlines the sources of aid, the responding agencies through which relief is flowing, and the end recipients of the donations.

At this point, the only question seems to be just how grim the outcome will be. Better late than never, I suppose.


The ebola rabbit is out of the hat,with the latest person in the U.S being tested positive tends to tell me that this disease is easier to contract than what media sources are telling us.
I find it hard to believe that the indiviual from Liberia who this woman became infected from was not treated and cared for with EVERY possible precaustion being taken by those who had been assigned the care giving task.
However with all that being done, someone has still come down with this terrible disease. I fear that ebola is going to be with us for the long haul.Where it all ends is in the lap of the god’s.

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WhatsApp, Mr. Zuckerberg?

Michael Corones
Oct 9, 2014 16:37 UTC

What? Zuck worry?

Mark Zuckerberg, apparently channeling the Alfred E. Neuman school of business management, told reporters in New Delhi, India, on Thursday that Facebook does not plan to monetize mobile messaging service WhatsApp any time soon.

Facebook’s acquisition of WhatsApp closed on Monday at a monstrous final price tag of $22 billion—up from $19 billion when the deal was struck—after EU regulators granted approval last Friday.

What gives the social networking giant the luxury of putting a $22 billion purchase on the back burner?

As this Reuters graphic shows, Facebook’s stock price has more than doubled since it’s tumultuous $38 IPO on May 18, 2012. Over the same period, the NASDAQ composite is up an impressive 60 percent, but the same surge in stock price that has pushed Zuckerberg’s net worth to over $34 billion also gives Facebook a valuation of almost $200 billion—plenty of financial cushion, and plenty of time to let its non-core properties grow.

Clearly, $200 billion can buy down a lot of anxiety.

Is OPEC heading for a sinkhole?

Michael Corones
Oct 8, 2014 17:05 UTC

Turmoil is rarely good for the bottom line. Saudi Arabia, Qatar and the United Arab Emirates are joining Washington’s anti-Islamic State air strikes within the borders of neighboring OPEC member Iraq. Fellow OPEC partner Nigeria just barely dodged an Ebola scare, while founding member Iran remains under sanctions aimed to curb its nuclear ambitions. Meanwhile, Russia, which last year produced an estimated 10.4 million barrels of crude oil a day, doesn’t look set to extricate itself from Ukraine any time soon.

Much of the oil-producing world is in turmoil, yet OPEC prices have fallen almost 20 percent since June. The reasons for this are complex, but include significant increases in the U.S. production of shale oil—also known as “tight oil”—over the past few years, which have eroded the American demand for imported oil.

As these Reuters graphics show, the price of Brent crude oil—the Middle East standard—just dipped beneath $100 per barrel for the first time in four years, and more than half of OPEC’s 12 member nations are in the red against their price per barrel breakeven point, with only Kuwait and Qatar healthily in the black.

This puts many of OPEC’s members in a tight spot. While some analysts view their next meeting, in November, as a chance to curb production with the goal of pushing prices higher, others see the cartel on shaky ground, with lead dog Saudi Arabia ready to wage a price war against its longtime partners.

We’ll see how things shake out. As author James Holland said, “The Middle East is a region where oil is thicker than blood.”



To suggest that the current strength of the US dollar is the sole cause for the drop in the price of oil is ludicrous. While the US currency is a factor in oil pricing, in a global commodity, supply and demand (perceived or real) are the paramount factors in establishing the price.

The real question should be why has the price of oil stayed so high despite the growing glut in supply?

Saudi Arabia will purposely lower prices in order to undercut and make unviable North American suppliers who have higher production costs. They recognize that in the long game, only a lower price (which they can afford) will prevent the North American suppliers from eating their lunch.

This will be unpopular with other OPEC members. We could well see the end of OPEC as a cohesive organization, as other OPEC members have expenditures which nearly match their revenues from their oil output. We certainly will see a lot of acrimony among OPEC members.

Oil’s days are numbered as the number one energy source in any case–and the high price of oil has made alternative supplies and research into alternatives more economically attractive. (not to mention environmental reasons)

I am confident that the technology for mass storage of electricity will be sufficiently advanced in the next 10 years to allow the deserts of the world to become global solar energy sources. With abundant electricity, the electrolysis of water to obtain clean-burning hydrogen is the next logical step.

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