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The fool John Kerry as SecState has been a perfect compliment to his boss. Throw in Hagel as SecDef and we have a hat trick of ignorance. The Pollard gambit was too much and is receiving the world’s opprobrium. It was kinda like a foreign policy “stinkburger.”  Jonathan Tobin starts our look at Kerry.

It was just a couple of months ago that Secretary of State John Kerry was being lauded as, in the words of CNN, “a surprise success.” He was hailed by the chattering classes as having exceeded Hillary Clinton’s record by showing daring instead of her instinctive caution. After all, hadn’t he managed to preside over a nuclear deal with Iran, saved President Obama’s face by negotiating a good deal with Russia about Syrian chemical weapons, and made progress on a withdrawal agreement in Afghanistan? Most of all, his audacious decision to restart Middle East peace talks when everyone was warning him it was a fool’s errand was seen as having great promise. As the Atlantic gushed, “It’s looking more and more possible that when the history of early-21st-century diplomacy gets written, it will be Kerry who is credited with making the State Department relevant again.”

But that was then. Today, Kerry is being rightly lambasted by the left, right, and center for his idiotic decision to introduce the issue of convicted spy Jonathan Pollard’s release into the Middle East peace negotiations. …

Tobin also posts on what he calls “the disturbing Pollard debate.”

… Anyone listening to the debate about Pollard being conducted in the last week must understand that his name is synonymous with charges of dual loyalty against American Jews who serve in both the U.S. government and its armed forces. As I detailed in my 2011 article, the damage that the cynical decision to employ a foolish and unstable person as a spy has done to American Jews and to the vital alliance between the U.S. and Israel is incalculable.

While after serving so much time in prison he is deserving of clemency, I stand by my previous conclusion about what should be the final word about this subject:

Long after his release or death, Pollard’s behavior will still be used to bolster the slurs of those who wish to promote the pernicious myth that there is a contradiction between American patriotism and deep concern for the safety of the State of Israel. It is this damning epitaph, and not the claims of martyrdom that have been put forward to stir sympathy for his plight, that will be Jonathan Pollard’s true legacy.

Which brings us to Krauthammer’s column for the week – “Kerry’s Folly – Chapter 3.”

When has a secretary of state been involved in so many disastrous, self-initiated negotiations? First, John Kerry convenes — against all advice and holding no cards — Geneva negotiations to resolve the Syria conflict and supposedly remove Bashar al-Assad from power. The talks collapse in acrimony and confusion.

Kerry’s response? A second Geneva conference that — surprise! — breaks up in acrimony and confusion.

Then, even as Russian special forces are taking over Crimea, Kerry goes chasing after Russian Foreign Minister Sergei Lavrov — first to Paris, then Rome, then London — offering a diplomatic “offramp.” Lavrov shrugs him off. Russia annexes Crimea.

The crowning piece of diplomatic futility, however, is Kerry’s frantic effort to salvage the Arab-Israeli negotiations he launched, also against all odds and sentient advice. He’s made 12 trips to the region, aiming to produce a final Middle East peace within nine months.

It is month nine. The talks have gone nowhere. But this has been a fool’s errand from Day One. There never was any chance of Palestinian leader Mahmoud Abbas concluding a final peace. …

… To keep stringing along the Israelis, some genius decided to dangle Jonathan Pollard. What’s he got to do with anything? Why is he being offered as an incentive for Israel to accept otherwise unacceptable conditions?

Normally, the United States facilitates agreements by offering Israel compensation for the security risks it takes upon giving up territory, because the Arabs either cannot or will not offer security guarantees of their own. Thus the United States might try to re-establish the military balance with advanced weaponry or access to timely intelligence.

But Pollard? He is an American traitor who is up for parole next year anyway. It has long been a mistake for Israel to agitate for his release. He disgracefully betrayed his country. What kind of corrupt and cynical quid pro quo is this? …

We have been treated to the breathless accounts by Michael Lewis about the Wall Street skullduggery in High Frequency Trading. Lewis’s claims that we’re all cheated have been repeated for the week since he was interviewed on 60 Minutes. It is time for some grownups to consider these claims. Craig Pirrong of Streetwise Professor is first.

Michael Lewis’s new book on HFT, Flash Boys, has been released, and has unleashed a huge controversy. Or put more accurately, it has added fuel to a controversy that has been burning for some time.

I have bought the book, but haven’t had time to read it. But I read a variety of accounts of what is in the book, so I can make a few comments based on that.

First, as many have pointed out, although this has been framed as evil computer geniuses taking money from small investors, this isn’t at all the case. If anyone benefits from the tightening of spreads, especially for small trade sizes, it is small investors. Many of them (most, in fact) trade at the bid-ask midpoint via internalization programs with their brokers or through payment-for-order-flow arrangements. (Those raise other issues for another day, but have been around for years and don’t relate directly to HFT.)

Instead, the battle is mainly part of the struggle between large institutional investors and HFT. Large traders want to conceal their trading intentions to avoid price impact. Other traders from time immemorial have attempted to determine those trading intentions, and profit by trading before and against the institutional traders.  Nowadays, some HFT traders attempt to sniff out institutional orders, and profit from that information.  Information about order flow is the lifeblood of those who make markets.

This relates to the second issue. This has been characterized as “front running.” This terminology is problematic in this context. Front running is usually used to describe a broker in an agency relationship with a customer trading in advance of the customer’s order, or disclosing the order to another trader who then trades on that information. This is a violation of the agency relationship between the client and the broker.

In contrast, HFT firms use a variety of means-pinging dark pools, accessing trading and quoting information that is more extensive and obtained more quickly than via the public data feeds-to detect the presence of institutional orders. They are not in an agency relationship with the institution, and have no legal obligation to it. …

Joe Nocera is next. 

There is always something just a little frustrating about reading a Michael Lewis book. On the one hand, Lewis’s core point — whether it is that left tackle has become the second most important position in football (“The Blind Side”), or that the stock market has become rigged by high-frequency traders, as his new book, “Flash Boys,” claims — is almost always dead-on. His ability to find compelling characters and tell a great story through their eyes is unparalleled. He can untangle complex subjects like few others. His prose sparkles.

On the other hand, there usually comes a point in a Michael Lewis narrative when it all starts to feel just a little too perfect. “Flash Boys,” which is excerpted in The New York Times Magazine, is no exception. The book’s hero, Brad Katsuyama, is a young executive at the Royal Bank of Canada who realizes that something has gone awry with the stock market.

As he digs deeper, he realizes that secretive high-frequency trading firms, taking advantage of lightning-fast computers, willing accomplices in the stock exchanges and some poorly thought-out federal regulation, have effectively hijacked the equity markets. Roused to action by what he has discovered, Katsuyama quits his job and starts up a new exchange, IEX, which includes a clever “speed bump” that levels the playing field for investors.

So far, so good. But Lewis doesn’t stop there. To make his hero appear even more heroic, he casts Katsuyama as the only person on Wall Street to figure out the high-frequency trading scam, and the only person with the courage to do something about it. That’s not quite the case.

Nearly two years ago, Scott Patterson of The Wall Street Journal wrote a book titled “Dark Pools: The Rise of the Machine Traders and the Rigging of the U.S. Stock Market,” which also exposed the scam. The book is structured remarkably like Lewis’s — Patterson’s got a heroic central character who learns the tactics of the high-frequency bunch and then acts on it by going to the Securities and Exchange Commission. Except Patterson’s hero isn’t Brad Katsuyama; he is Haim Bodek. When I caught up with Bodek, he groused about how Katsuyama had only part of the picture, and how there were other elements of high-frequency trading that needed as much if not more exposure. …

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Good time to look at November’s voting for the senate. Jason Riley is first.

When Democratic Sen. Carl Levin announced that he would retire this year, few people saw a pickup opportunity for the GOP. Yet it’s turning into that kind of year for Republicans, who need a net gain of six seats in the fall to retake control of the Senate.

Terri Lynn Land, who’s running to replace Mr. Levin, was not the Republican establishment’s first choice (that would have been Rep. Mike Rogers), but the former Michigan secretary of state continues to perform above expectations. Yet another poll, out this week, has her statistically tied with Democratic Rep. Gary Peters in a state that President Obama carried by nearly 10 points in 2012.

In Colorado last month, a tea party Republican who lost a previous Senate race agreed to step aside for a more viable candidate, Rep. Cory Gardner. Suddenly, incumbent Democratic Sen. Mark Udall isn’t as invulnerable as everyone thought when the cycle began. Scott Brown‘s decision to challenge Democratic Sen. Jeanne Shaheen in New Hampshire has had a similar effect. …

Jennifer Rubin is next.

To the dismay of Democrats, the playing field for control of the Senate has expanded beyond what even Republicans imagined would be possible. Let’s consider the total picture, and which seats are now in play.

While they won’t admit it, Democrats have all but lost Senate seats in West Virginia, Montana and South Dakota. Republicans recruited top candidates, and the Democrats are unlikely to spend significant money. That is in large part because there is a very good possibility they will also lose Arkansas (where incumbent Mark Pryor trails in recent polling), North Carolina (same there for Kay Hagan) and Alaska (where Dan Sullivan now seems the most capable opponent.) So stop there. If only these races go as expected and the Republicans lose no seats, then the GOP wins the Senate. It is very easy to imagine this occurring. And we haven’t yet mentioned the imperiled Mary Landrieu, who is trying to survive the association with the party of Obamacare and opposition to domestic energy production).

Take then the next level of races. …

Karl Rove devoted his weekly column to the races. 

With seven months until the midterm election, there’s little for Democrats to cheer in the growing number of polls on this year’s Senate contests.

Republicans have double-digit leads in the three races in red states Mitt Romney carried where the incumbent Democrat retired. West Virginia Rep. Shelley Moore Capito is up by 14 points, 49%-35%, over Secretary of State Natalie Tennant in a Feb. 20 Rasmussen poll. Former South Dakota Gov. Mike Rounds leads Democratic congressional staffer Rick Weiland 51%-31% in a Feb. 26 Rasmussen survey. Montana Rep. Steve Daines is 14 points ahead of interim Sen. John Walsh, 51%-37% in a March 18 Rasmussen matchup. These public polls mirror private ones, suggesting Republicans are positioned to win if they keep the pressure on.

The next benchmark for these races is the April 15 Federal Election Commission fundraising reports for the first quarter. All three Republican candidates had a commanding financial advantage at the end of 2013. If they maintain the money edge for 2014′s first and second quarters, Democratic donors may start cutting their losses and shifting funds elsewhere.

Then there are the four red states where incumbent Democratic senators are trying to retain their seats. Each race is a dogfight, though every Democrat has much higher name identification than the Republican challenger. …

Tablet Magazine has a profile of Eugene Volokh and the Volokh Conspiracy. 

Last week, when the Supreme Court heard arguments over whether religiously owned corporations like Hobby Lobby should be exempt from providing contraception coverage to their employees, the government’s reply brief cited dozens of cases and statutes—and one blog with a weird name, The Volokh Conspiracy.

It wasn’t the first time the site made itself heard before the nation’s highest court. In the wake of the passage, in 2010, of the Affordable Care Act—the cornerstone of President Obama’s domestic agenda—libertarian writers for The Volokh Conspiracy were instrumental in building the constitutional challenge to the law’s individual mandate. “When the Affordable Care Act was going through the legislative process, most law professors agreed that the ACA was constitutional,” said South Texas College of Law’s Josh Blackman, who wrote the definitive scholarly account of the challenge.

Then The Volokh Conspiracy entered the fray, and everything changed. “Usually these kinds of legal arguments develop over the course of many years in law reviews, in conferences and symposiums,” Blackman continued, “but this was on warp speed. You had blog posts on the day where you could actually see the arguments shaping before you.” Soon the challenge was being hotly debated among law professors and was adopted by state attorneys general across the United States. What the legal establishment once considered an open-and-shut laugher turned into a 5-4 Supreme Court nail-biter.

It was, perhaps, the first time that a highly technical legal debate on a matter of national policy importance—the sort of discussion usually confined to law reviews, academic panels, and conference rooms at the Justice Department—played out in real time for the consumption of lay readers as well as professionals, and it cemented the site’s role as a public clearinghouse for cutting-edge legal debate. As Paul Clement, the former U.S. solicitor general who represented the 26 states opposing Obamacare, put it, “The Constitution had its Federalist Papers, and the challenge to the Affordable Care Act had The Volokh Conspiracy.”

Founded as a solo operation in April 2002, the site is now one of the Internet’s most-read legal blogs, boasting a diverse readership of scholars and policymakers—as well as Supreme Court Justices—across the ideological spectrum. (Justice Elena Kagan has said she reads it daily.) In January, The Volokh Conspiracy moved to the Washington Post, giving it an even more prominent role in the national conversation—and more power to shape the discourse surrounding issues currently being decided in the courts, from religious freedom to gay marriage.

How did a center-right blog written by libertarian-leaning professors become the most influential in American legal circles? The story begins with its founder and namesake, a Soviet Jewish refugee named Eugene Volokh.

In 1975, Volokh arrived with his parents in the United States from Ukraine. The family settled in California; five years later, Volokh was admitted to UCLA on a full scholarship after scoring 780 out of 800 on the mathematical portion of his SAT. It would have been an impressive achievement for any student, let alone any recent immigrant—but Volokh was also just 12 years old at the time. In 1981, the Los Angeles Times ran a profile in which the writer dubbed Volokh a “prodigy, a genius, or, simply, staggeringly bright,” and reported his IQ at 206. He chose to attend UCLA, the article noted, because he wanted to stay close to home—and because he wasn’t old enough to drive. …

The Economist has come around to the point of view that much of the money spent on higher education is wasted. Virginia residents will be heartened by the four most rewarding degrees. First is University of Virginia and fourth is William and Mary. And, this is further proof of Pickerhead’s sagacity since four of his children earned degrees at those two schools.

WHEN LaTisha Styles graduated from KennesawStateUniversity in Georgia in 2006 she had $35,000 of student debt. This obligation would have been easy to discharge if her Spanish degree had helped her land a well-paid job. But there is no shortage of Spanish-speakers in a nation that borders Latin America. So Ms Styles found herself working in a clothes shop and a fast-food restaurant for no more than $11 an hour.

Frustrated, she took the gutsy decision to go back to the same college and study something more pragmatic. She majored in finance, and now has a good job at an investment consulting firm. Her debt has swollen to $65,000, but she will have little trouble paying it off.

As Ms Styles’s story shows, there is no simple answer to the question “Is college worth it?” Some degrees pay for themselves; others don’t. American schoolkids pondering whether to take on huge student loans are constantly told that college is the gateway to the middle class. The truth is more nuanced, as Barack Obama hinted when he said in January that “folks can make a lot more” by learning a trade “than they might with an art history degree”. An angry art history professor forced him to apologise, but he was right.

College graduates aged 25 to 32 who are working full time earn about $17,500 more annually than their peers who have only a high school diploma, according to the Pew Research Centre, a think-tank. But not all degrees are equally useful. And given how much they cost—a residential four-year degree can set you back as much as $60,000 a year—many students end up worse off than if they had started working at 18. …

… What is not in doubt is that the cost of university per student has risen by almost five times the rate of inflation since 1983, and graduate salaries have been flat for much of the past decade. Student debt has grown so large that it stops many young people from buying houses, starting businesses or having children. Those who borrowed for a bachelor’s degree granted in 2012 owe an average of $29,400. The Project on Student Debt, a non-profit, says that 15% of borrowers default within three years of entering repayment. At for-profit colleges the rate is 22%. Glenn Reynolds, a law professor and author of “The Higher Education Bubble”, writes of graduates who “may wind up living in their parents’ basements until they are old enough to collect Social Security.” …