Your Coffee May Have Some Health Perks, but Can Brew Trouble in People With Certain Conditions

To judge by recent headlines, coffee could be the latest health-food craze, right up there with broccoli and whole-wheat bread.

But don’t think you’ll be healthier graduating from a tall to a venti just yet. While there has been a splash of positive news about coffee lately, there may still be grounds for concern.

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This month alone, an analysis in the Archives of Internal Medicine found that people who drink three to four cups of java a day are 25% less likely to develop Type 2 diabetes than those who drink fewer than two cups. And a study presented at an American Association for Cancer Research meeting found that men who drink at least six cups a day have a 60% lower risk of developing advanced prostate cancer than those who didn’t drink any.

Earlier studies also linked coffee consumption with a lower risk of getting colon, mouth, throat, esophageal and endometrial cancers. People who drink coffee are also less likely to have cavities, gallstones, cirrhosis of the liver, Parkinson’s disease and Alzheimer’s disease, or to commit suicide, studies have found. Last year, researchers at Harvard University and the University of Madrid assessed data on more than 100,000 people over 20 years and concluded that the more coffee they drank, the less likely they were to die during that period from any cause.

But those studies come on the heels of older ones showing that coffee—particularly the caffeine it contains—raises blood pressure, heart rate and levels of homocysteine, an amino acid in blood that is associated with stroke and heart disease. Pregnant women who drink two or more cups of coffee a day have a higher rate of miscarriages and lower birth-weight babies; caffeine has also been linked to benign breast lumps and bone loss in elderly women. And, as many people can attest, coffee can also aggravate anxiety, irritability, heartburn and sleeplessness, which brings its own set of problems, including a higher risk of obesity. Yet it’s just that invigorating buzz that other people love and think they can’t get through the day without.

Why is there so much confusion about something that’s so ubiquitous? After all, some 54% of American adults drink coffee regularly—an estimated 400 million cups per day—and coffee is the second most widely traded commodity in the world, after oil.

For starters, the vast majority of coffee studies to date have been observational, in which researchers examine large sets of data over many years, looking for patterns in peoples’ habits and their health.

But subjects don’t always remember or report accurately on how much they drink. Cup sizes can range from 6 to 32 ounces; caffeine loads can vary from 75 to nearly 300 milligrams. Loading up with sugar, flavored syrup and whipped cream can turn a no-fat, almost no-calorie drink into the equivalent of an ice-cream soda.

Even carefully constructed observational studies that correct for such variables can only find correlations, not prove a cause-and-effect relationship. There may be other, hidden reasons why people who drink a lot of coffee have a lower risk of illness—such as jobs that provide a steady income and access to health care, exercise and healthier food. Conversely, “people who don’t feel that healthy may be less likely to drink six cups of coffee a day. … It’s just a possibility,” says Jim Lane, a psychophysiologist at Duke University Medical Center who has studied the effects of caffeine for more than 25 years.

Risks Disappear

Indeed, many studies from earlier decades that linked coffee drinking to a higher risk of cancer were apparently detecting related habits instead. Once researchers started adjusting for study subjects who also smoked cigarettes, the additional cancer risk disappeared.

“When I went to medical school, I was told that coffee was harmful. But in the ’90s and this decade, it’s become clear that if you do these studies correctly, coffee is protective in terms of public health,” says Peter R. Martin, a professor of psychiatry and pharmacology at Vanderbilt University and director of the school’s Institute for Coffee Studies, founded in 1999 with a grant from coffee-producing countries.

Still, many researchers believe that the only way to draw firm conclusions about something like coffee is through experimental trials in which some subjects are exposed to measured doses and others get a placebo, with other variables tightly controlled. When that’s been done, says Duke’s Dr. Lane, “the experimental studies and the [observational] studies are in very sharp disagreement about whether caffeine is healthy or not.”

Harmful Effects

His own small, controlled studies have shown that caffeine—administered in precise doses in tablet form—raises blood pressure and blood-sugar levels after a meal in people who already have diabetes. Other studies have found that caffeine and stress combined can raise blood pressure even more significantly. “If you are a normally healthy person, that might not have any long-term effect,” says Dr. Lane. “But there are some groups of people who are predisposed to get high blood pressure and heart disease and for them, caffeine might be harmful over time.”

Epidemiologists counter that such small studies don’t mirror real-world conditions, and they can’t examine the long-term risk of disease.

The prostate-cancer study, for example, compared the coffee-drinking habits of 50,000 men working in medical professions with their incidence of prostate cancer over 20 years, and also took into account family history of prostate cancer and how frequently they had screenings. Roughly 5,000 of the men developed prostate cancer during that period, including 846 cases of the most advanced and lethal kind. But the more cups of coffee the men drank, the less likely they were to be in that most lethal group. “You can’t do a randomized controlled trial on men starting in their 20s and following them until they are old enough to get prostate cancer,” says lead investigator Kathryn Wilson, a research fellow in epidemiology at Harvard School of Public Health. “For some of these questions, observational studies are the best we are going to get.”

As for diabetes, at least 18 studies have found that drinking three or more cups of coffee a day is linked with a lower risk of developing the disease. The more such findings are repeated, particularly with different populations, the stronger the evidence is.

Beyond Caffeine

In both the prostate and diabetes studies, the health benefits were found for caffeinated as well as decaffeinated coffee, suggesting that some other component in coffee is responsible. Coffee contains traces of hundreds of substances, including potassium, magnesium and vitamin E, as well as chlorogenic acids that are thought to have antioxidant properties.These may protect against cell damage and inflammation that can be precursors to cancer, diabetes, neurological disorders and cardiovascular disease.

One theory gaining credence is that some of those beneficial components may counterbalance some of the harmful effects of caffeine. For example, while caffeine keeps people awake in part by blocking adenosine, a brain chemical that brings on sleep, the chlorogenic acid in coffee keeps adenosine circulating in the brain longer.

And while caffeine seems to boost adrenaline that primes the body for action, coffee itself may have a calming effect. Even the aroma of coffee beans can help ease stress in rats, researchers at Seoul National University in South Korea showed in a study in the Journal of Agricultural and Food Chemistry last year. Chlorogenic acid also slows the release of glucose into the bloodstream after a meal, which may counteract caffeine’s glucose effect.

Benefits Cloaked in ‘Mays’

“It’s a yin and yang effect,” says Vanderbilt’s Dr. Martin, an addiction psychiatrist who also notes that former alcoholics who drink coffee are more apt to stay sober than those who don’t. Even though these studies are just associations, he says, “they may provide leads for us to better understand some of the most common illnesses that affect mankind as well as developing ways to treat them. But everything is cloaked in ‘mays.’ ”

Most researchers agree that there isn’t enough evidence about the benefits of coffee to encourage non-coffee drinkers to acquire the habit. And no one has come close to finding a recommended number of cups per day for optimum health. People’s reactions to coffee are highly individual. One small cup can give one person the jitters while others can drink 10 cups and sleep all night.

At the same time, people who love coffee probably don’t need to worry that they are harming their health by drinking it — unless they already have high blood pressure or are pregnant or are having trouble sleeping, in which case it’s prudent to cut down.

Even Dr. Lane, who thinks the risks of caffeine outweigh coffee’s potential benefits, concedes he drinks several cups a day. “Why do I do it?” he muses. “I ask myself that question …”

Melinda Beck, Wall Street Journal

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Full article and photos: http://online.wsj.com/article/SB10001424052748703278604574624032849271284.html

While so many of our institutions have failed, we can repair them. The first step is to take personal responsibility.

The accomplished and sophisticated attorney was asked what attitude he was bringing to the new year. “Stoicism and mindless optimism,” he laughed, which sounded just about right. He meant it, he said, about the stoicism. He had immersed himself in that rough old philosophy after 9/11, and had come to adopt it as his own. But he meant it about the optimism, too: You never know, things get better, begin with good cheer, maintain your equilibrium, don’t lose your peace.

We’re at the clean start of a new decade, and it wouldn’t be bad if the national watchwords were repair, rebuild and return, with an eye toward what is now our central project, though we haven’t fully noticed, and that is keeping our country together. So many forces exist to tear us apart. We have to do what we can to hold together in the long run.

We have been through a hard 10 years. They were not, as some have argued, the worst ever, or even the worst of the past century. The ’30s started with the Great Depression, featured the rise of Hitler and Stalin, and ended with World War II. That’s a bad decade for you. In the ’60s we saw our leaders assassinated, our great cities hit by riots, a war tear our country apart.

But the ‘OOs were hard, starting with a disputed presidential election, moving on to the shocked pain of 9/11, marked by an effort to absorb the fact that we had entered the age of terror, and ending with a historic, world-shaking economic crash.

Maybe the most worrying trend the past 10 years can be found in this phrase: “They forgot the mission.” So many great American institutions—institutions that every day help hold us together—acted as if they had forgotten their mission, forgotten what they were about, what their role and purpose was, what they existed to do. You, as you read, can probably think of an institution that has forgotten its reason for being. Maybe it’s the one you’re part of.

We saw an example this week with the federal government, which whatever else it does has a few very essential missions to perform that only it can perform, such as maintaining the national defense. Our federal government now does 10 million things, many of them not so well. Its attention is scattered. It loses sight of the essentials, which is part of the reason underpants bombers wind up on airplanes.

Wall Street the past 10 years truly and profoundly lost sight of its mission. It exists to be the citadel of American finance. Its job is to grow and invest and enrich, thereby making the jobs possible that help family exist.

Wall Street has a civic purpose. But it must always do its job with an eye to prudence, because a big part of its job is to provide a secure and grounded economic footing for the nation. But throughout the ’00s Wall Street’s leaders gave themselves over to one thing, and that was looking out, always, for No. 1. And they knew how to define No. 1. It wasn’t the country, and it wasn’t even the company. They’d crater companies, parachute out, and brag about it later.

If there was one damning and utterly illustrative quote that captured Wall Street in the past 10 years it was that of Charles Prince, CEO of Citigroup, in July 2007. Worrying investment trends were beginning to emerge, but why slow down? He told The New York Times, “As long as the music is playing, you’ve got to get up and dance.” This from a banker, a leader, a citizen, a man responsible for a community.

Congress forgot the mission, or rather continued more than ever to seem to have forgotten the mission. They weren’t there to legislate with a long view, they were there to be re-elected and help the team, the red one or the blue one. This is not a new story, only a worsened one.

The Catholic Church, as great and constructive an institution as ever existed in our country, educating the children of immigrants and healing the weak in hospitals, also acted as if it had forgotten the mission. Their mission was to be Christ’s church in the world, to stand for the weak. Many fulfilled it, and still do, but the Boston Globe in 2003 revealed the extent to which church leaders allowed the abuse of the weak and needy, and then covered it up.

It was a decades-long story; it only became famous in the ’00s. But it was in its way the most harmful forgetting of a mission of all, for it is the church that has historically given a first home to America’s immigrants, and made them Americans. Its reputation, its high standing, mattered to our country. Its loss of reputation damaged it. And it happened in part because priests and bishops forgot they were servants of a great institution, and came to think the great church existed to meet their needs.

A variation of this attitude continues in the public schools, where there are teachers who forget they have a mission—to teach and guide the young—and instead come to think the schools exist for them, to give them secure jobs and meet their needs.

Name the institution and you will probably see a diminished sense of mission, or one that has disappeared or is disappearing. Journalism too the past decade—longer—has had trouble remembering why it exists, which is to meet a real and crucial public need for reliable information about the world we live in. It’s the job of journalists to find the news, to get it in spite of the myriad forces arrayed against getting your hands on it, to report it clearly and honestly.

And as all these institutions forgot their mission, they entered the empire of spin. They turned more and more attention, resources and effort to the public perception of their institution, and not to the reality of it.

Everyone gave their efforts to how things seemed and not how they were. Press secretaries, press assistants, media managers, public relations experts—they abound more than ever in our business and public life. Half the people in Congress are people who one way or another are trying to “communicate” the member’s thinking. But he’s not really thinking, he’s positioning, and they’re not thinking either, they’re organizing and deploying focus-grouped phrases and turning them into talking points

So what to do? Here my friend the lawyer’s stoicism and mindless optimism might come in handy, for turning around institutions is a huge, long and uphill fight. It probably begins with taking the one thing we all hate to take in our society, and that is personal responsibility.

If you work in a great institution: Do you remember the mission? Do you remember why you went to work there, what you meant to do, what the institution meant to you when you viewed it from the outside, years ago, and hoped to become part of it?

And an optimistic idea, perhaps mindlessly so: It actually might help just a little to see national hearings aimed at summoning wisdom and sparking discussion on what has happened to, and can be done to help, our institutions. This wouldn’t turn anything around, but it could put a moment’s focus on a question that is relevant to people’s lives, and that is: How in the coming decade can we do better? How can we repair and rebuild?

Peggy Noonan, Wall Street Journal

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Full article and photo: http://online.wsj.com/article/SB10001424052748704152804574628522483219740.html

A Lethal Mix of Cocaine and Chilies

Police officers around the world often use pepper spray to restrain people who are out of control. But after a series of unexplained deaths, researchers now suspect the spray, which is derived from chili peppers, could be fatal if the subject has been using cocaine or other drugs.

The man was clearly out of his senses. Peter M., 42, was naked and covered with blood as he ran across Munich’s Höhenstadter Street. He threw himself on the ground, shouting: “I am God.” Then he smeared superglue on his wounds and smashed his head into a window.

Policemen rushed to the scene and sprayed pepper spray into the man’s face, but it had no effect. Several officers eventually managed to subdue him. When they finally handcuffed him, Peter M. collapsed. He was taken to a hospital, where he died two days later, on July 5.

The autopsy determined that the man had died of restraint-related asphyxia after being handcuffed by police. He had been using cocaine, which also could have caused his death. But pepper spray “played no role in the autopsy result,” said Barbara Stockinger, the Munich chief prosecutor assigned to the case. The case, which appeared to have been resolved, was closed.

But the death of Peter M. may not be as straightforward as it appears. The bizarre circumstances aside, his case resembles similar incidents around the world in which people under the influence of drugs get out of control, police use pepper spray to restrain them, and then, “15 to 30 minutes later, they’re dead or in a coma,” says John Mendelson, a doctor specializing in addiction at the California Medical Center in San Francisco.

Mice on Cocaine

The results of a study Mendelson has just completed reinforce a suspicion long held by critics of pepper spray, namely that it can be deadly for people under the influence of illicit or psychotropic drugs.

Mendelson’s conclusions are based on experiments with mice in his laboratory. One group of mice was given injections of cocaine and nothing else. The mice in a second group also received a dose of capsaicin, an extract from the chili pepper.

When the researchers checked the cages again after 24 hours, only a few of the mice that had been given cocaine were dead. But more than half of those injected with the cocaine-chili blend were no longer alive. It appears that, at least in the case of mice, “capsaicin has a tendency to make smaller doses of cocaine fatal,” Mendelson says.

Spicy and Dangerous

In the 1960s, postal carriers began using a mixture of cayenne pepper and mineral oil to protect themselves against overly zealous watchdogs. Park rangers in the United States also used pepper spray to ward off intrusive grizzly bears. Police departments around the world began using the irritant in the 1990s.

Capsaicin is 600 times more potent than the spiciest cayenne pepper. Suspended in a mixture of ethanol and water, the substance irritates the eyes and mucous membranes. Pepper spray, effective at distances of about two meters (6.5 feet) and probably more dangerous than tear gas, enables police officers to contain violent individuals without having to use batons or firearms. Most police officers have been wearing pepper spray on their belts for years. “There is nothing available that’s more effective,” officials with the Berlin police department said after the spray was introduced.

“We recommended it,” says Hans Damm, head of the Forensic Science Institute at the German Police University in the northwestern German city of Münster. “Pepper spray was a new thing that came from the United States, and because it was a natural substance, even the Green Party couldn’t object.”

The dosage is a different matter altogether. Because the chili-based agent is difficult to obtain in pure form, companies often resort to the use of synthetic capsaicin. In addition, people’s reactions to the substance vary widely. “In some cases, there isn’t that much difference between effective and fatal doses,” says Damm.

In the past six months, at least three people in Germany have died after police used pepper spray against them. Two were under the influence of illicit drugs, while the third victim was taking strong prescription sedatives.

Strikingly Similar

In the United States, the American Civil Liberties Union (ACLU) has documented a number of deaths following the use of pepper spray, including 26 fatalities in California alone between 1993 and 1995. Of those cases, 24 of the victims were on drugs and two were mentally ill. Nevertheless, a study by the US Department of Justice concludes that pepper spray was partly responsible for fatalities in only two out of 63 cases studied.

It’s true that drug use can be enough by itself to kill a person. But researcher John Mendelson believes that there is an interaction between the chili extract and drugs. He speculates that the nerve receptors that respond to the substance are the same ones that are active when a person is high. According to Mendelson, the documented cases are strikingly similar: “It’s almost always people who do crazy things, like running naked through traffic while holding a knife.”

The German cases seem to support his theory. On Oct. 31, a 27-year-old drug addict died in Laucha in the eastern state of Saxony-Anhalt. The man, who had taken crystal methamphetamine, ran into the street naked and began smashing the windshields of parked cars with his fist. Then he attacked a female pastor. Police sprayed the man in the face with pepper spray, but there was no reaction.

Finally, four officers overpowered and handcuffed the man. He died a short time later. The autopsy concluded that the cause of death was a drug overdose. German medical examiners are often unaware that “pepper spray could be a factor contributing to death,” says Fred Zack, a forensic scientist from Rostock in northern Germany. “We may be entering new territory here.” In 2007, Zack performed an autopsy on a heavily inebriated man from Ribnitz-Damgarten in Mecklenburg-Western Pomerania who had died after pepper spray was used on him.

Tase Me, Bro

In another case, employees at a nursing home for the mentally ill in Heidhausen, a neighborhood in the western city of Essen, called the police on Aug. 7 to report that a 43-year-old patient, a powerfully built Russian, had threatened the staff. An emergency doctor injected a sedative into the man, but then he jumped out of his bed and attacked people standing nearby. Even with pepper spray, police officers had trouble restraining the man. He died soon afterwards. Four months later, the autopsy results are still inconclusive.

Mendelson believes that both illegal drugs and psychotropic drugs could interact similarly with pepper spray. Ironically, when pepper spray was introduced, authorities touted the substance as being particularly suitable for use against the mentally ill and people under the influence of drugs.

“Pepper spray hardly deters people in delirious states,” says Mendelson. He recommends the use of electroshock devices known as Tasers instead. “Under these circumstances, they appear to be safer and more effective.”

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Full article: http://www.spiegel.de/international/germany/0,1518,669607,00.html

Easy Money

Two Germans were caught in an Austria mountain town with 500 million dollars in counterfeit banknotes. It’s one of the biggest hauls of counterfeit dollars in Europe. But the culprits say they thought the 1 million dollar bills were real. Early next year an Austrian court must decide their fate. 

FORMER VICE president Richard B. Cheney on Wednesday joined a Republican chorus criticizing the Obama administration’s decision to charge alleged bomber Umar Farouk Abdulmutallab in federal court. Mr. Cheney and others argue that Mr. Abdulmutallab, who is accused of trying to down Northwest Flight 253 over Detroit on Christmas, should have been held as an enemy combatant and pumped for information, rather than read his Miranda rights and provided a lawyer. They further argue that the decision to shuttle him to federal court shows that President Obama is in denial about the dangers of terrorism.

This last claim has no merit. Just as it would be a mistake to approach all terrorist acts as a law enforcement challenge, so would it be imprudent to dispense with strong and available law enforcement tools, and to deal with all such incidents as acts of war. Recall that the Bush administration prosecuted shoe bomber Richard Reid in federal court for attempting to down a transatlantic flight using the same type of explosives allegedly found on Mr. Abdulmutallab. No one then questioned the Bush-Cheney administration’s judgment or its resolve — and rightly so.

The prospects for Mr. Abdulmutallab’s prosecution are good. Multiple eyewitnesses can testify to the incident on the plane, and physical evidence, including the failed explosive device, has been recovered. If the case goes to trial, there is probably little danger that secret sources or methods will be exposed.

Yet part of the critics’ argument is worthy of discussion. Mr. Abdulmutallab could have been detained without charge and interrogated outside of the constraints of federal rules to give the administration an opportunity to gather information in hopes of thwarting a future attack. The Supreme Court has acknowledged this authority, and the Obama administration has gone so far as to argue that Congress, through the 2001 Authorization for the Use of Military Force, gave the president the right to hold combatants indefinitely as long as a court of law rules that the initial detention was justified.

So why not bundle the Nigerian suspect to a secure location for intensive questioning by the CIA? First, because he already has been talking to authorities about his affiliation with al-Qaeda and the possibility of other attacks. Second, because he is no Khalid Sheik Mohammed — he is not a seasoned al-Qaeda operator but a disturbed young man whom the group tried to use as cannon fodder.

Most important, the Bush administration’s own experience has showed that holding suspects as enemy combatants creates more problems than it solves, because of the lack of due process and legal accountability. We have called for the creation of a national security court to govern presidential decisions to detain those who are too dangerous to release but against whom there is insufficient evidence to hold under federal criminal statutes. This authority could be valuable in interrogating those high up in a terrorist organization who are believed to possess significant operational information. It would be wasted on Mr. Abdulmutallab.

Editorial, Washington Post

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Full article: http://www.washingtonpost.com/wp-dyn/content/article/2009/12/30/AR2009123002347.html

Prices are often irrational. So are consumers.

Almost two-thirds of retail prices end in a nine on some estimates. These “charm prices”—set just below a round number—are meant to lead consumers to round down rather than up. While some doubt their effectiveness, plainly Steve Jobs is a believer, insisting initially that all tracks on iTunes be priced at 99 cents, as is Jeff Bezos, whose Kindle was first priced at $359, later $299 and then $259.

In “Priceless,” William Poundstone explains charm prices and other common pricing anomalies. More broadly, he explores some of the basic notions of behavioral economics and argues that psychology matters as much as logic in many simple economic decisions. Most prices, Mr. Poundstone notes, are not the result of exact science but are “slippery and contingent,” relying on “coherent arbitrariness”: Consumers don’t know the “right” price for anything and mainly respond to price increases and the price of one thing compared with another.

Not surprisingly, retailers and marketers exploit consumer psychology to make consumers think that they are getting more for less and to divert attention from any attempt to charge more. Sometimes, for instance, manufacturers stealthily reduce the size of their product. Mr. Poundstone cites Skippy peanut butter, which recently added an indentation to its jars that reduced its size by 9%. Consumers tent to react less to this subtle price inflation than to a higher price tag—particularly for regularly purchased products whose price consumers will remember. Eventually, a company will run out of corners to cut and can then start over with an entirely new package and price that is hard to compare to the old one.

Another popular pricing technique is to use expensive “anchors” that consumers use as comparison points. Mr. Poundstone says, for instance, that Prada carries a few “obscenely high priced” items to make everything else seem affordable by comparison. Restaurants sometimes use similar tactics. The “$1,000 caviar and lobster omelet” on the menu at New York restaurant Norma’s is principally for show, not sale. Even if no one orders it, its astronomical price tag may tend to “bewitch” customers into spending more than they would have otherwise.

Whatever the pain of an irrationally expensive breakfast, it pales in comparison with buying an over-priced house. To avoid that mistake, however, a buyer may need to cover up the price tag and appraise the house without being influenced by the seller’s number. In one experiment, a group of licensed real estate agents were shown a house and told that it had been listed for $119,900. When asked to estimate a reasonable purchase price, their average was $111,454. When a different group of agents was told that the listing price for exactly the same house was $149,900, their average estimate was $127,318. The agents had subconsciously used the listing price as a reference point for their appraisals—even though they knew it was irrelevant.

Consumers, of course, are aware of all these tricks. And yet the evidence is overwhelming that they are influenced by them. Forewarned but not forearmed: Individuals are far less rational than they often believe.

This notion has been best explained by Dan Ariely in “Predictably Irrational” (2008), which Mr. Poundstone cites frequently. Mr Ariely explored some of the basic notions of behavioral economics—and showed how real-life decision-making differs from utilitarian economic models. At the core of much behavioral economics is “prospect theory,” a set of ideas that were developed by Daniel Kahneman (winner of the 2002 Nobel Prize in economics) and Amos Tversky.

The theory emphasizes how risk—or risk aversion—affects decision-making, and it helps to explain why actual prices often differ from what one might rationally expect, even for something that is easy to value—like money itself. Consumers tend to over-value certainty: When offered the choice between a certain $3,000 and an 80% chance of $4,000, most people choose the lower amount even though the alternative’s expected value—its average probability-weighted return—is $3,200. Similarly, individuals have an irrationally high aversion to loss: Most people turn down an offer to flip a coin and win $110 for heads and lose $100 for tails. A study of contestants on the TV game show “Deal or No Deal” found that more decisions were consistent with prospect theory than with maximizing the expected return.

The additional value that individuals place on locking in certainty and avoiding loss explains why consumers are willing to buy financial products that otherwise seem to make no sense—such as extended product warranties where the price of the warranty is greater than the expected value of the loss being protected. Similarly it explains why consumers over-pay for flat-rate plans—say, unlimited calling plans, when a limited plan would likely be cheaper: They want to avoid the risk of a huge bill.

While Mr. Poundstone explains the increasingly sophisticated techniques that businesses use to exploit human irrationality, he says little about the effect that the rise of e-commerce may have on all this pricing strategy. While there may still be some scope for psychological manipulation, consumers should be harder to confuse with access to instant price comparisons and product research online. Relatedly, the Web may offer opportunities for better customer segmentation and hence finer price differentiation—where prices take into account each consumer’s willingness to pay. Why give everyone a discount when some people will pay full price? Perhaps the customer that searched for “highest rated” will pay more than someone who searched for “lowest price.” Tailored offers and customized bundles can muddy the water for comparisons. As Robert Crandall, a former CEO of American Airlines, has said: “If I have 2,000 customers on a given route and 400 different prices, I’m obviously short 1,600.”

Mr. Philips is executive vice president of News Corp., which owns Dow Jones & Co., the publisher of The Wall Street Journal.

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Full article and photo: http://online.wsj.com/article/SB10001424052748704152804574628390662807658.html

America isn’t dead. It’s just dead in the water.

Why pretend? We have arrived at a point where nearly everyone’s conversation of more than five minutes about what is going on in the nation or the world ends up in the ditch.

The opinion polls are deep into the no-holiday spirit, competing to deliver low blows to the American psyche. Pew Research Center began dim December with a survey titled “Current Decade Rated Worst in 50 Years.” Washington Post/ABC staggered in with the bad word that 61% of the American people think their country is in long-term decline.

The U.S. is starting to sound like one long Rodney Dangerfield joke: “I looked up the family tree and found out I was the sap.”

Why the long national face?

Pew’s numbers touched the heart of the past decade’s sense of sadness. Asked to identify the decade’s singular event, 53% said the attacks of September 11, 2001. Nothing else was close.

It is debated often whether 9/11’s sense of urgency about the threat of Islamic terror has faded. Apparently not for the American people. We’ll catch a break if the past week wakes up Washington.

If at its end the decade was looking for a silver lining, this one got the shaft—another gray September. In September 2008, the U.S. financial system for all intents and purposes blew up. Years of imprudently low interest rates and Congress’s political protection of bargain-basement mortgages decked the world in moral hazard. Cheap money was (is) crack for bankers. When the subprime mortgage mania blew, it took down much of Wall Street and a decade’s worth of 401(k) gains.

Let’s toss in the decade’s last straw just for the fun of it: The politicians running California, New York, New Jersey and arguably Congress were shown to be fiscally deranged. If America is in decline, its political class is leading it over the cliff.

Americans are historic optimists. They must be: Another recent study found that the happiest state in the Union is . . . Louisiana. Hurricanes, floods, wars, depression—somehow this country’s can-do spirit won’t die.

Until now. There is a datum in the pollsters’ 10-year ash heap that is disturbing and new. At the start of 2008, according to Pew, well before the September financial implosion, 41% said the U.S. was the world’s leading economic power; 30% said China. By this November, those numbers had flipped: 44% said China was on top; only 27% said the U.S.

However false this is, what people are saying is they assume China in time will clean our clock. This is a frightening snapshot of national demoralization.

It is a nation refusing to answer the bell. Throwing in the towel. We can’t compete. We’re done.

I don’t buy it. America isn’t dead. It’s just dead in the water.

In Pew’s comparison of five decades, one trumps the other four: the 1980s. “The balance of opinion about the 1980s is overwhelmingly positive across all age groups.” The 1980s’ negative rating is just 12%.

How can this be? As the ’80s ended, pundits everywhere famously wrote the whole thing off as “The Decade of Greed.” Left-wing essayist Barbara Ehrenreich, one of too many to count, called her version of the decade, “The Worst Years of Our Lives.”

But it looks like people think the ’80s were the best years of their lives. We—especially those among us thinking of running for the presidency—had better try to figure out why fast.

Because all conversation in our politics goes straight into rage if one brings any public figure’s name into it, I will preposterously not mention Ronald Reagan.

Forget greed. That was just an artifact, a side show. More than anything, the 1980s freed Americans to do the one thing they love to do above all else: create.

From day one many better decades ago, America has been about compulsive creation. It’s a nation driven by the New—new ideas, new cities, new companies, technologies, art forms, production, management, distribution, design, Hollywood, Tin Pan Alley, Silicon Valley.

Some of it’s good, some of it’s bad, some of it’s ugly. So what? This is the upward-moving mojo that Americans want to get them back in the game—the space to create, build and do what’s new. The big question raised by you-know-who in the 1980s was whether government was part of the solution to national creativity or part of the problem.

Time’s up, so let’s not spoil the downer spirit by ending with false optimism.

We are in the anti-1980s. But I don’t care how flat the earth is; with competitors like China, India and the others, the belief that our big fat national government can somehow subsidize, much less identify, the U.S.’s next creative edge is straight from the dusty book of the original flat-earth society.

So a New Year’s Eve prediction: If we stay on the course set the past year, the next decade will make the 2000s look like the end of the golden age.

Daniel Henninger, Wall Street Journal

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No despot fears the president, and no demonstrator in Tehran expects him to ride to the rescue.

With year one drawing to a close, the truth of the Obama presidency is laid bare: retrenchment abroad, and redistribution and the intrusive regulatory state at home. This is the genuine calling of Barack Obama, and of the “progressives” holding him to account. The false dichotomy has taken hold—either we care for our own, or we go abroad in search of monsters to destroy or of broken nations to build. The decision to withdraw missile defense for Poland and the Czech Republic was of a piece with that retreat in American power.

In the absence of an overriding commitment to the defense of American primacy in the world, the Obama administration “cheats.” It will not quit the war in Afghanistan but doesn’t fully embrace it as its cause. It prosecutes the war but with Republican support—the diehards in liberal ranks and the isolationists are in no mood for bonding with Afghans. (Harry Reid’s last major foreign policy pronouncement was his assertion, three years ago, that the war in Iraq was lost.)

As revolution simmers on the streets of Iran, the will was summoned in the White House to offer condolences over the passing of Grand Ayatollah Hussein Montazeri, an iconic figure to the Iranian opposition. But the word was also put out that the administration was keen on the prospect of John Kerry making his way to Tehran. No one is fooled. In the time of Barack Obama, “engagement” with Iran’s theocrats and thugs trumps the cause of Iranian democracy.

In retrospect, that patina of cosmopolitanism in President Obama’s background concealed the isolationism of the liberal coalition that brought him to power. The tide had turned in the congressional elections of 2006. American liberalism was done with its own antecedents—the outlook of Woodrow Wilson and FDR and Harry Truman and John Kennedy. It wasn’t quite “Come home, America,” but close to it. This was now the foreign policy of Harry Reid and Nancy Pelosi and Joe Biden. There was in the land a “liberal orientalism,” if you will, a dismissive attitude about the ability of other nations to partake of liberty. It had started with belittling the Iraqis’ aptitude for freedom. But there was implicit in it a broader assault on the very idea of freedom’s possibilities in distant places. East was East, and West was West, and never the twain shall meet.

We’re weary, the disillusioned liberalism maintains, and we’re broke, and there are those millions of Americans aching for health care and an economic lifeline. We can’t care for both Ohio and the Anbar, Peoria and Peshawar. It is either those embattled people in Iran or a rescue package for Chrysler.

The joke is on the enthralled crowds in Cairo, Ankara, Berlin and Oslo. The new American president they had fallen for had no genuine calling or attachments abroad. In their enthusiasm for Mr. Obama, and their eagerness to proclaim themselves at one with the postracial meaning of his election, they had missed his aloofness from the genuine struggles in the foreign world.

It was easy, that delirium with Mr. Obama: It made no moral demands on those eager to partake of it. It was also false, in many lands.

Thus Turks who loathed the Kurds in their midst, who denied them the right to their own memory and language, could identify themselves, or so they said, with the triumph of Mr. Obama and his personal history. No one questioned the sincerity with which Egyptians and other Arabs hailed Mr. Obama as they refused to be stirred by the slaughter in Darfur, and as they gave a carte blanche to Khartoum’s blatant racism and cruelty.

Surely there was something amiss in Paris and Berlin—the vast crowds came out for Mr. Obama, but there were millions of Muslims in France and Germany, and the gates hadn’t been opened for them, they hadn’t been swept into the mainstream of European life. Postracicalism, rather like charity, should have begun at home, one would think.

Everywhere there is on display evidence of the rogues taking the Obama administration’s measure, and of America’s vulnerable allies scurrying for cover. A fortnight ago, Lebanon’s young prime minister made his way from Beirut to Damascus: Saad Hariri had come to pay tribute to the Syrian ruler.

Nearly five years earlier, Saad Hariri had insisted on the truth about the identity of his father’s killers. It had been a tumultuous time. Rafik Hariri, a tycoon and former prime minister caught up in a challenge to Syria’s hegemony in Lebanon, had been struck down by a massive bomb on Beirut’s beachfront. It’s obvious, isn’t it, the mourners proclaimed, the trail led to Damascus.

In the aftermath of that brazen political murder, a Syrian tyranny in Lebanon that had all but erased the border between the two countries was brought to a swift end with what would come to be known as the Cedar Revolution. The Pax Americana that had laid waste to the despotism of Saddam Hussein frightened the Syrian rulers, and held out the prospect that a similar fate could yet befall them.

We’re now worlds away from that moment in history. The man who demolished the Iraqi tyranny, George. W. Bush, is no longer in power, and a different sentiment drives America’s conduct abroad. Saad Hariri had no choice but to make peace with his father’s sworn enemies—that short voyage he made to Damascus was his adjustment to the retreat of American power.

In headier moments, Mr. Hariri and the leaders of the Cedar Revolution had been emboldened by American protection. It was not only U.S. military power that had given them heart.

There was that “diplomacy of freedom,” the proclamation that the Pax Americana had had its fill with the autocracies and the rogues of the Greater Middle East. There but for the grace of God go we, the autocrats whispered to themselves as they pondered the fall of the Iraqi despot. To be sure, there was mayhem in the new Iraq—the Arab and Iranian rulers, and the jihadists they winked at and aided, had made sure of that. But there was the promise of freedom, meaningful elections, a new dignity for men and women claiming their own country.

What a difference three or four years make. The despots have waited out that burst of American power and optimism. No despot fears Mr. Obama, and no blogger in Cairo or Damascus or Tehran, no demonstrator in those cruel Iranian streets, expects Mr. Obama to ride to the rescue. To be sure, it was in the past understood that we can’t bear all burdens abroad, or come to the defense of everyone braving tyranny. But there was always that American assertion that when things are in the balance we would always be on freedom’s side.

We hadn’t ridden to the rescue of Rwanda and Burundi in the 1990s, but we had saved the Bosnians and the Kosovars. We didn’t have the power to undo the colossus of Chinese tyranny when the tanks rolled into Tiananmen Square, but the brave dissidents knew that we were on their side, that we were appalled by the cruelty of official power.

It is different today, there is a cold-bloodedness to American foreign policy. “Ideology is so yesterday,” Secretary of State Hillary Clinton proclaimed not long ago, giving voice to the new sentiment.

History and its furies have their logic, and they have not bent to Mr. Obama’s will. He had declared a unilateral end to the “war on terror,” but the jihadists and their mentors are yet to call their war to a halt. From Yemen to Fort Hood and Detroit, the terror continues.

But to go by the utterances of the Obama administration and its devotees, one would have thought that our enemies were Dick Cheney and Donald Rumsfeld, not the preachers and masterminds of terror. The president and his lieutenants spent more time denigrating “rendition” and the Patriot Act than they did tracking down the terror trail and the latest front it had opened at the southern tip of the Arabian Peninsula in Yemen. Our own leaders spoke poorly of our prerogatives and ways, and they were heard the world over.

Under Mr. Obama, we have pulled back from the foreign world. We’re smaller for accepting that false choice between burdens at home and burdens abroad, and the world beyond our shores is more hazardous and cynical for our retrenchment and our self-flagellation.

Mr. Ajami, a professor at Johns Hopkins School of Advanced International Studies and a senior fellow at Stanford University’s Hoover Institution, is the author of “The Foreigner’s Gift” (Free Press, 2007).

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Ambitious Republicans should resolve to run for office next year.

President Obama not only left Washington, D.C., for the holidays, but the lower 48 as well. So I thought I’d offer a few New Year’s resolutions for him and others to come back to in the coming year.

First, to Mr. Obama’s staff: The Norwegian Nobel Committee didn’t want to wake the president to tell him about his prize earlier this year, but there shouldn’t be any reluctance to reassure the nation after a terrorist attack. Also, why not resolve to have a few less “historic” moments? How many can one president really have, anyway? A little more grace toward his predecessor would help him, as would less TV time. He is wearing out his welcome and his speechwriters—judging by the quality of their work lately.

In 2010, Mr. Obama should work on his habit of leaving a room of people with deeply divided opinions thinking he agrees with all of them. That leads to disagreements over essential issues, like the meaning of his pledge to begin withdrawal from Afghanistan in 2011 and the nature of the new military mission there.

Finally, Mr. Obama should work on meaning what he says. He didn’t last year with all those health-care deadlines and tough talk supporting the public option. Now Mr. Obama will pivot to jobs and deficit reduction. As he tries to do that, voters will wonder if it’s just a ruse to save Democrats.

Vice President Joe Biden should resolve to speak publicly less. Every time he opens his mouth, the West Wing staff uses him to make the president look good by comparison.

White House Social Secretary Desiree Rogers should take a lead from Santa Clause and make her list and check it twice . . . at the White House gates.

Homeland Security Secretary Janet Napolitano should resolve to take a systems analysis course before she again declares that a system “worked.”

The Democratic congressional leadership should resolve to come up with Plan B. After rejecting bipartisanship in 2009, they won’t be able to pass bills in 2010 with only Democrats. Too many vulnerable Democrats will flake on big votes.

House Speaker Nancy Pelosi—who has reportedly let it be known that she is comfortable with losing scores of House seats to pass ObamaCare—might resolve to treat her pet Blue Dogs a little better. As for the Blue Dogs, why not resolve to become Republicans?

Senate Majority Leader Harry Reid should resolve to strive for a little less unity in his caucus and in the meantime enjoy this term in office. It’s likely to be his last unless Nevada Republicans tear themselves apart next year for the privilege of running against him.

Republican congressional leaders should resolve not to sit on their laurels. They’re winning the battle for public opinion on health care, cap and trade, and spending, but by next fall, it won’t be enough to surf voter dissatisfaction with Mr. Obama and Democrats. Voters will want to know what Republican candidates would do.

A second Contract with America won’t suffice. The GOP really won in 1994 by arming candidates with a basket of issues to pick from. Next year, candidates must be fluent in kitchen-table issues from jobs to health care to deficits to spending.

Ambitious Republicans should resolve to run next year. There will be a wave of voter support for GOP positions, but authenticity, passion and conviction matter. Voters can smell them, so bone up on the issues and say what you believe, not what someone tells you to say.

Democratic National Committee Chairman Tim Kaine should resolve not to blame himself for the coming political tsunami that’ll hit his party next November. He should press Mr. Obama to raise lots of money to spend on close races in states where Democrats are in charge of redistricting. If not, he’ll face a very ugly 2012 congressional election, too.

Republican National Committee Chairman Michael Steele had a great year in generating enthusiasm among small donors, but ends 2009 with less cash on hand than he had when he started the year. He should resolve to stop giving paid speeches and instead use his time repairing frayed relationships with major donors, whose support is critical to winning legislatures that will redraw congressional districts in 2011.

Tea Party members should resolve to resist being turned into another partisan political group. The movement’s power stems from its ideas, not from any party it supports, and it has been very successful in educating Americans and arousing the country. It should let its members set their own personal course in primaries and fall elections.

As for me, I resolve to speak well of Mr. Obama more frequently, curry favor with liberals by being more critical of my fellow conservatives, and be guided by the words of Mark Twain, who said that the start of a New Year “is the accepted time to make your regular annual good resolutions. Next week you can begin paving hell with them as usual.”

Mr. Rove, the former senior adviser and deputy chief of staff to President George W. Bush, is the author of the forthcoming book “Courage and Consequence” (Threshold Editions).

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