Tuesday, March 31, 2009


My client has slowed down and the dangerous condition of me having some free time on my hands has given me an itch to "upgrade" my blog. I want, among other things, to have a picture of a train in the heading, and do something clever with a subheading about a posting "cars in a train of thought." Okay, I'm still working on that. It means uploading a whole new "template" though, so things may look a little weird for a while.

I've also saved this template, of course, so if things get too bad you may see it reappear (temporarily or permanently).

I have touted Blogspot to people new to blogging for quite a while, in part because of the amount of customizing one can do with its appearance. Wordpress has much to recommend it, but it's not real easy to play around with its looks. Blogspot also has a user's forum (click on "Help" in the Dashboard) which is very active and friendly.

So regardless of what I accomplish, I should have some fun.

Notice the new "Permalink" and "Share this" gadgets at the bottom of each post. I have no idea whether or not the latter works. If anybody finds out, please let me know.

Update: Tuesday, 7:15pm; It didn't work, removed.

Update: Wednesday, 7:30am, Okay not much different yet, other than being blue, which I like. It is, however the new style template and I'm shopping various various "open source" template sites before I do much customizing. The way google has set up changing fonts and colors is quite cool.

Unequal Treatment

Much is being made of the differences in treatment between the financial sector and the auto industry as to financial support. Differences as to firing of leadership and honoring of contractual agreements are being much discussed, but I have not heard any real discussion of a much more fundamental difference in the way the government is dealing with them.

With the auto industry, government is demanding complete restructuring of they way that automakers run their business, and that demand is pretty specific. They must drop some makes and models and focus on others, they must attain certain goals as to performance of their products, they must concentrate on hybrid and electric cars. They must, in fact, become a different car company in order to receive assistance, and the specific commitment to those changes must be made before the money is provided.

With the financial sector, which failed just as disastrously as the auto industry, if not more so? There is some vague expectation that they will start lending and a hint that they will be subjected at some date in the indefinite future to some sort of new rules. None of that is spelled out as any kind of actual requirement, though, and no changes are required of the financial houses before funds amounting to 70 times the amount requested by the automakers are handed to them without further questions.

Do they tell the financiers that they must change their procedures on leveraging before they are eligible for government loans? They do not. Do they tell the financiers that they must change their procedures on selling derivatives before they are eligible for government loans? They do not. Do they tell the financiers that they must change their procedures on giving ratings to bonds and financial instruments before they are eligible for government loans? They do not.

The auto industry, which failed big because it made stupid decisions, needs to make fundamental changes before it can obtain assistance. The financial services sector, which failed even bigger because it made even stupider decisions, must accept the idea that some new rules might be coming in the indefinite future order to obtain assistance, but is told to get back to doing what it was doing before it failed.

That pretty much tells us who is really running the country.

Update: Tuesday, 9:30am
As Attywood says, "What are we going to do about America's ruling class, since we can't seem to vote them out of power?"

Monday, March 30, 2009

Internet Security

Common thinking used to be that spam was going to render the Internet useless, but we seem to be dealing with it rather effectively. It remains annoying but nothing more than that.

What is rendering the Internet useless is Internet security measures, which have just gone berserk. I used to be able to monitor my home mortgage at the Citibank website, but no more. It requires me to change my password on a regular basis, and it has really abstruse requirements for passwords; letters, numbers, symbols, arrangements... It rejected everything I tried. It also has "security questions" including one about the name of my first dog. I've never owned a dog in my life, but apparently I made up some answer in the distant past to satisfy them. I have no idea what I made up, so it's back to monitoring my mortgage by telephone.

I used to be able to log into my bank account and view my business account, personal account, and the joint account which I maintain with my wife. No more. I now can view only one account at a time and must log in with a password and user name three separate times for "security reasons." I have asked that bank statements for two of the accounts be mailed to me, and will use online banking for only one account in the future.

Maybe security measures do need to be this unwieldy, in which case the usefulness of the Internet seems really questionable to me. Maybe we are better off doing business the "old fashioned way."

Change That Isn't

Barack Obama promised, as he campaigned for the office he now holds, to change the nature of the war on terror, or terrorism, or Islam, or whatever it is that we have soldiers overseas fighting against and being killed by. So far that change has been very difficult to see.

Fewer soldiers have come home from Iraq than have been sent to Afghanistan so the total number in harm’s way is, at the moment, increased. We have promises of drawdown in Iraq. Promises. Even the promises are vague, at best, and look suspiciously like a long term military occupation of that misbegotten land.

The misadventure in Afghanistan, announced on a Friday afternoon in the hopes that no one would notice it as they started their weekends, is still short on specific objectives and exit strategy. President Obama speaks of an exit strategy that sounds suspiciously like “We’ll stand down as they stand up” and his objective seems to be denying them a location in which to plan their dastardly deeds.

Dude. You don’t need the wilds of the Hindu Kush to do any planning. I am here at my computer in downtown San Diego, planning feverishly. Okay, I’m not planning on bombing any cities, more like what to have for dinner tonight, but still.

The whole thing makes no sense to me. “Driving them out and assuring that they never return.” That’s just Bushian in its grandiosity and nonsensical nature. How is he going to “assure they never return” anyway? Sprinkle some sort of magic anti-Al Qaeda pixie dust?

Building up armies in Iraq and Afghanistan, and national police forces so that they can “stand up” and we can (supposedly) “stand down.” Aerial bombardment of both of those nations and Pakistan in addition, something that is supposedly not part of counterinsurgency operation. What does any of that accomplish? Planning occurs in someone’s brain, and if you run them out of Afghanistan they will take their brain with them to some other location and keep right on planning.

“Maintaining order” in those nations is of dubious value to us at best, and think about what maintains order here at home. We don’t maintain order with the United States Army, or with some massive national police force patrolling the streets armed to the teeth, kicking down doors and searching homes. We don’t maintain order with tanks and helicopters and airplanes dropping bombs. We do it with the San Diego Police, police officers addressing citizens as “sir” and “ma’am” and getting search warrants as needed. We do it with detectives culling evidence and solving crimes and arresting criminals.

But we deem that in Iraq, Afghanistan and Pakistan order must be maintained by building up their armies and national police forces and airplanes dropping bombs. Have we lost our minds?

Plus, it should be noted that our tanks and soldiers and bomb-dropping airplanes are not doing a very good job of maintaining order.

Post 9/11 the next three major attacks were not planned in the wilds of Afghanistan or Pakistan, they were planned in suburbia of major European cities. The apprehensions that have occurred have not occurred as a result of military intervention, but due to police action and criminal investigation. The only thing that all of this military action and bomb dropping has done is make the rest of the world less inclined to be on our side, and Obama’s inclination seems to be that if it isn’t working it’s because we aren’t doing enough of it. So far, rather than getting up out of Iraq, he’s merely expanded the war into Pakistan so that now we are fighting three nations instead of two.

I voted for Obama because I did not want John McCain as President, endlessly harping to us about keeping us safe, fighting wars without exit strategies and dictating to other nations what they must do. I did not expect that I would have Obama working from that same playbook.

Saturday, March 28, 2009

The Future of Conservatism

I just wasted thirty minutes of my life watching Podhoretz, Goldberg and Kristol supposedly discuss the subject referenced in the post title on Cspan. Mostly it was the first two, as Bill Kristol merely sat between them trying to look intelligent. (And failing.) All they talked about was their silly magazines, online and otherwise, and what they saw as ways to increase circulation and/or readership, along with tips on how to write articles.

I think that tells us all we need to know about...

Elusive Logic

The people who are flying the UAV’s that are dropping bombs on Pakistan, a nation with which we are presumably not at war, are putatively located in Nevada and New Mexico.

If Pakistan, which is not at war with us, decided to fly airplanes over Nevada and New Mexico and drop bombs on the operators that were harming them by bombing their citizens, we would probably become all snotty and high handed about how they are violating our national sovereignty, and would be outraged that they are killing citizens within our borders without asking our government for permission. Their argument that they were in some fashion defending themselves would be...

Of course our government would say no, so their asking permission is more than likely a bit moot.

I’m not sure I get the principle involved. We can bomb their territory because we think there is someone there who might harm us some day in the indefinite future, who we believe is planning to harm us, but who is not doing anything right at the moment. They cannot bomb us even though there is someone here who actually and provably is harming them now, and is actually bragging to the world about doing it.

Demonstrating Respect

President Obama, in announcing his new and improved Afghanistan policy yesterday, reassured Pakistan that, “The United States has great respect for the Pakistani people.” And we demonstrate that respect by bombing the shit out of them using unmanned drones.

“To avoid the mistakes of the past, we must make clear that our relationship with Pakistan is grounded in support for Pakistan’s democratic institutions and the Pakistani people.” And we make that support clear, again, by bombing that democratic institution and killing those Pakistani people. I don’t know how they could possibly mistake that message.

“Pakistan must demonstrate its commitment to rooting out al Qaeda and the violent extremists within its borders. And we will insist that action be taken…” And, of course, giving them orders and insisting what they must do is the clearest possible statement of respect for the Pakistani people and their institutions of democracy.

He didn’t offer them any carrots or threaten them with any sticks. Those sophisticated instruments of diplomacy are apparently reserved only for enemies, whom we don’t bomb the shit out of, like Iran.

Or, perhaps, for briar patch nations whose diplomats are rabbits.

Quality of Politics

I often watch things like this and wonder if we are electing idiots to govern us, and if so why. Part of a post by Glen Greenwald was sort of a "boxcar in that train" of thought.
My guess is that Webb, having succeeded in numerous other endeavors outside of politics, is not desperate to cling to his political office, and he has thus calculated that he'd rather have six years in the Senate doing things he thinks are meaningful than stay there forever on the condition that he cowardly renounce any actual beliefs. It's probably true that most career politicians, possessed of few other talents or interests, are highly unlikely to think that way.

I think his point is valid. We elect people who do not have the talent to do anything else. Once in a while we elect a maverick who would prefer to do something worthwhile rather than merely what is necessary to preserve a career; a career which, for most, is the only thing he is fit for.

Friday, March 27, 2009

Financial Creativity

In his press conference Tuesday President Obama made reference to his dislike of the part of our economy where “AIG sells a derivative and it is considered part of GDP” or words to that effect. He contradicts that at other times by saying repeatedly that “we don’t want to stifle the creativity of our financial industry.”

I would suggest that we not only want to stifle that creativity, we want to extinguish it, and Paul Krugman wrote an editorial in the New York Times yesterday which rather supports my contention. I’ll leave you to read what he says, but he winds it up with,
As you can guess, I don’t share that vision. I don’t think this is just a financial panic; I believe that it represents the failure of a whole model of banking, of an overgrown financial sector that did more harm than good. I don’t think the Obama administration can bring securitization back to life, and I don’t believe it should try.

And what is this “securitization” to which he refers? It is, in my perception, a layer of fiction laid on top of the financial system that we once knew as capitalism, placed there by the financial industry which it has enriched, purely for the purpose of that enrichment.

At the foundation of our economy is the production of goods and the provision of services. To facilitate those things on a larger scale we formed companies, groups of people, to perform those functions on a cooperative basis. To participate in the ownership of one of those companies one gives it money and receives part ownership in return, sharing the risk of failure and participating in the gain achieved by that company. If a person decides not to keep that ownership he can sell it back to the company, or he can sell it to another party, who then becomes the part owner in that person’s place. The stock market facilitates that process. That is the basis of capitalism and it is solid and sustainable and, as Paul Krugman points out, boring. It worked very well for centuries.

Then someone decided that, while he liked the potential gain of owning stock, he didn’t like the risk. He agreed with another party to insure him against his stock declining in value so that he could participate in gains by the company of which he was part owner, but not fear any losses due to that ownership. That put a layer of financial transaction on top of the existing framework, and it opened the financial system to manipulation, distortion, deception and fraud.

Other “inventions” came along one after another. The owner of the stock could borrow money based on the fact that he owned that stock. Then he could borrow based on the insurance that he had on the ownership of that stock. Then his debt could be sold to another party as if it were an asset. The more “creative” these financial instruments became the more they became vulnerable to manipulation, distortion and outright fraud. It is notable that, six months into the financial crisis, we are still trying to calculate just what is the financial standing of the banks and financial houses which are involved in it.

To the Administration’s credit it is pressing hard for reregulation, although the nature to the proposed rules is very murky at this point. But I would suggest that a mere set of new rules falls far short of what is needed.

First, the whole “creative” layer needs to be eradicated to the greatest possible degree. Our economy needs to be brought as close as it can be to the production of goods, provision of services, the unleveraged sale and purchases of stock, the insurance of individuals, investments which serve as savings, demand deposit functionality and nothing else.

Second, the “big banks” need to be broken up as to both size and function. The business of financial investment, acceptance of demand deposit, and issuance of insurance need to be isolated into separate companies with no common interests of any description. No banking, investment or insurance operation should be allowed to exist, or have ties to any other operation with existence in, any more than six states. Economy of scale is very real, but you cannot convince me that beyond a six-state scope of operation the economy of scale produces sufficient savings to offset the power of size.

It may not need to be this radical, but I stand by the principle.

Thursday, March 26, 2009

Liberal Thinking

Rachel Maddow did a lengthy segment last night about a portion of the Democratic Party, she calls them “Conserva-Dems,” who are not toeing the line on President Obama’s agenda. She is, needless to say, pretty much outraged by their traitorous behavior and wants to know just what the hell they think the voters elected them to do.

Maddow considers herself the archetype liberal, but she seems to have forgotten just what a “liberal” is. By definition a liberal is someone who is open to new ideas, and by extrapolation liberals think for themselves. How can you be open to new ideas if you are marching in lockstep with a monolithic ideology set forth by your party leadership, which is what Maddow wants Democratic Senators to do?

How happy would Rachel Maddow be if she were one of those Senators and the party leadership told her how she was going to vote on a particular bill, or what policies she was going to support?

The Republicans have no problems along those lines. Republicans seem to have no difficulty following the dictates of authority. Leadership sets the party ideology and the membership and politicians of the party march along in step without a murmur. Thinking is not required; talking points are provided and are parroted endlessly by all.

If you get five Democrats in a room you will get about seven opinions on any given subject, since two of them will change their minds during the discussion. Trying to lead the Democratic party is much like trying to herd a bunch of cats, because everyone is thinking about things and following the dictates each of his/her own conscience. That is both the strength and the weakness of the party; strength because it leads to some pretty good and typically sound ideas, and weakness because trying to get everyone going in the same direction is an exercise in futility.

But if you change that basic nature, you no longer have a party of liberals. You then have two parties of Republicans with different names and differing ideologies, but neither is open to change or new ideas or original thinking. That would be a terrible loss to the nation.

Training Manual
Rachel also did a lengthy segment with a guy from Slate.com, mocking an Al Queda recruiting manual which has been posted on the Internet. The two of them go on and on about how the manual seems at odds with what Al Queda purports to stand for, and how the manual seems to have been written by idiots. I wonder if it occurred to either of them that the manual might be a spoof, posted by some prankster, and that they have just been punked?

Throwing Away Money

San Diego continues to be a fun place to live. Even the "cops and robbers" events can be fun here.

An undercover police operation conducted a drug buying sting the other day near the downtown area. The putative buyers showed the undercover cops a bag full of money and then, for reasons that are unclear, the officers allowed the drug buyers to put the money back in their own car and everyone got in their cars and proceeded to drive to some other location. That seems like a strange way to conduct a drug bust to me, but presumably the undercover cops had their reasons.

In transit to the new location the undercover cops asked the San Diego police to pull the putative drug buyers over. Why they didn’t do so themselves is also unclear, but they asked the uniformed branch to do it and that’s when things started downhill, because SDPD attempted that feat with a singular lack of success.

A high speed freeway chase ensued, with the putative drug buyers fleeing from a dozen or more police cars and flinging cash out of the cars windows as fast as they could shovel it. Massive traffic jams resulted as drivers by the hundred jammed on their brakes and jumped out of their cars, on the freeways, to grab the cash. If that sounds like strange behavior to you, then you are obviously not from San Diego. We do much stranger things than that here.

Apparently the putative drug buyers intent was getting rid of evidence because, as soon as they had tossed the last of the cash out of their car they stopped, got out of their car and basically said, “Who us?”

No, I am not making this up.

The cops were pretty peeved. All of this chasing and yelling, screaming and pointing of guns, and all they had these guys for was fleeing from the police, which is a violation but not a very serious one. They had no evidence of anything more serious. You can’t buy drugs with good intentions (or bad ones, either), you need cash for that, and these guys had no cash. The evidence was scattered over many miles of freeway being scooped up by San Diego drivers.

Well, some of it was being scooped up by the police too, but they had quite a bit of competition from the general citizenry. Not to mention half a dozen low-hovering television helicopters were creating a draft which was helping to scatter the evidence hither and yon. Television coverage of the event was lengthy and priceless.

Between what the police scooped up and what has been turned in, about $40,000 has been recovered, but police claim that some $185,000 is still “unaccounted for.” (I actually think I can account for it in a general sort of way, but…) They want anyone who picked up any of the money to turn it in. Good luck with that. It is evidence in a criminal trial, officials say, and they need it for these pending trials.

No, really, you can't make this shit up.

I actually think that "We need it for evidence" thing is a little bogus. There is something called "chain of evidence" which is really battered beyond repair here. Are they really going to call several thousand citizens to the stand and expect the jury to believe each one of them saying, "Yeah, that's the twenty that I picked up on the freeway" months or years after the event? "Oh yeah, I would recognize that sawbuck anywhere." And yes, I'm sure I saw it blow out of the defendant's car window. Give me a break.

Officials are making vague threats about what will happen to people who don’t turn it in. People who keep it can be charged with several crimes, they say, including theft, tampering with evidence, possibly obstruction of justice or – get this – money laundering. Money laundering?

See, we don’t just have sun and sand, beautiful women and hunky lifeguards here on the lower end of the Left Coast.

Wednesday, March 25, 2009

'GWOT' is Over?

According to an article in the Washington Post the "Global War On Terror" is no longer an operative phrase. I would be delighted to hear that, except for what is designated to replace it,

"Overseas Contingency Operation"

I mean, can you hear some kid asking, "What did you do in the Overseas Contingency Operation, Daddy?" More like, "What the hell is a Contingency Operation, Daddy, and why do they have to send you Overseas to do it?"

Every time I think the Obama Administration has it right, they come up with something like this. Jeez.

Questions and Answers

Unlike the past, which was Questions and Evasions.

He did actually answer every single question, and he stayed on point each time. I have a finely tuned bs meter, and the needle never did anything more than sort of make a small twitch off of the zero peg. He was certainly more impressive than was the media. Gak.

How long has it been since we have has a President who could explain anything as clearly as President Obama explained the charitable deduction issue last night?

In that sense, what it would do is it would equalize -- when I give $100, I'd get the same amount of deduction as when some -- a bus driver who's making $50,000 a year, or $40,000 a year, gives that same $100. Right now, he gets 28 percent -- he gets to write off 28 percent. I get to write off 39 percent. I don't think that's fair.

Or can turn an objection on its head as quickly.

…are you confident the charities are wrong when they contend that this would discourage giving?

OBAMA: Yes, I am. I mean, if you look at the evidence, there's very little evidence that this has a significant impact on charitable giving.

I'll tell you what has a significant impact on charitable giving, is a financial crisis and an economy that's contracting. And so the most important thing that I can do for charitable giving is to fix the economy…

Then there was this from Chuck Todd,

Thank you, Mr. President. Some have compared this financial crisis to a war. And in times of war, past presidents have called for some form of sacrifice.
Why, given this new era of responsible that you're asking for, why haven't you asked for something specific that the public should be sacrificing to participate in this economic recovery?

Before we get to the President’s answer, that may be the most inane thing I have heard asked at a news conference in years. I used to respect Chuck Todd, but I think he just looked at too many poll numbers during the election and it did something to his mind.

Anyone comparing a declining economy to a war, a comparison I have not heard used by the way, is an idiot and Chuck Todd is an idiot to bring that comparison into the question. And asking why the President hasn’t asked for the public, the public, to be sacrificing “something specific” in this crisis is stupifyingly idiotic.

I’m surprised that President Obama didn’t just tell him to shut up and sit down so that somebody else could ask a sensible question, but after talking about requiring sacrifices from Wall Street, he did say this,

With respect to the American people, I think folks are sacrificing left and right. I mean, you've got a lot of parents who are cutting back on everything to make sure that their kids can still go to college. You've got workers who are deciding to cut an entire day -- an entire day's worth of pay so that their fellow co-workers aren't laid off.

Todd was sufficiently self-absorbed not to realize he had been bitch slapped and had the nerve to sort of babble a rather incoherent follow-up. I have lost any trace of respect for him. He’s been palling around with Dick Gregory.

Jake Tapper, ABC’s version of a Basset Hound and just about as coherent, asked about signing a congressional budget bill that hasn’t even been drafted yet. I think he was competing with Todd for the inanity award. President Obama had to answer the same question twice, that he wouldn’t decide whether or not to sign it until it actually existed, because Tapper didn’t understand the answer the first time. I don’t think Tapper understood the second answer either, but they didn’t allow him a third try.

At one point the President said this, which practically had me cheering,

I mean, when you have an economy in which the majority of growth is coming from the financial sector, when AIG selling a derivative is counted as an increase in the gross domestic product, then that's not a model for sustainable economic growth.

I could not agree more, and my thoughts on that will be the subject of a whole future post. I am cheered by the suggestion that the President gets what is wrong with the nature of our economy, though, even if it doesn't square up with any of the actions currently being taken by his Treasury Department with respect to Wall Street.

The best of the night, and I’m sure what will be most quoted,

It took us a couple of days because I like to know what I'm talking about before I speak.

That will make him pretty much unique in Washington.

Update: Wednesday, 9:00am
Ding, ding, ding, okay we already have a candidate to supercede both Todd and Tapper for the Inanity Award. It's still early, but Ron Fournier of the Associated Press comes out with an article today under a headline that contains "Analysis," "Teleprompter" and "caution" to describe President Obama's press conference last night. Go read his drivel at the link if you want, but the headline pretty much says it all.

Tuesday, March 24, 2009

More Getting It Wrong

Of course Wall Street loves the latest financial recovery plan. If you had something that was worth probably thirty cents and the government offered a chance to sell it for sixty cents, wouldn't you love that idea? If the government offered you a loan that you only had to repay if you made a profit on it, would you not take it in a heartbeat?

The real joy, though, is that this assures Wall Street that the Administration is going to make no fundamental rearrangement of the financial power structure; it's going to try to repair the existing one, not attempt to create a new one. That means that, at least for now, those who have held the reins will continue to hold them.

It also means that the stock traders who made a fortune getting us into this mess get to make another fortune getting us, supposedly, out of it. So buy, buy, buy.

Monday, March 23, 2009

More Getting It Right

Opponents are saying that President Obama should put healthcare, energy, and what have you on the back burner and focus on the economy. President Obama is saying that our nation's chief executive should be able to walk and chew gum at the same time. I should certainly hope so.

If he can't we are all well and truely sunk, because healthcare, energy, the economy, foreign policy and what have you are not separate issues. They all happen at the same time and they all affect and interact with each other. Dealing with all of them at the same time is what we elect a President to do.

Getting It Wrong

TARP1 was Paulson's plan (which had to be passed within days, you may recall, to avoid financial Armageddon), in which we needed to spend $700 Billion to purchase toxic assets from financial houses. Congress gave him half that amount and then became confused and angry when he didn't use it to buy up toxic assets. He told them that he had decided that buying toxic assets actually was not going to work.

TARP2 is Geithner's plan in which we need to spend $700 Billion $1 Trillion or more to rename toxic assets as "legacy loans" and give money to hedge funds so that they can buy these legacy loans from financial houses. Apparently buying up the toxic assets from financial houses will work fine if we first rename them as "legacy loans" and do it through an intermediary.

Bear in mind that I didn't go to college, so I may have it wrong.

Getting It Right

I have issues with some of the things that President Obama is doing, but I voted for him and I would do it again. After watching him on 60 Minutes last night I would do it with bells on, sing Yankee Doodle and jump up and down while doing it.

Much is being made of the "punch drunk" thing but I barely recall that, other than remembering that it made me vaguely annoyed with Kroft. What I do recall is the segment in which President Obama gracefully and with great dignity utterly destroyed Cheney on both moral and pragmatic grounds. I have never been more certain that we elected the right man.

Running Out of Patience

As much as I dislike David Gregory, bear with him to listen to what Erin Burnett says right at the end of the clip. (What Tom Brokaw has to say is not exactly gibberish, either.) She refers to the public running out of patience with the difference in income between the upper class and the working class.

I have written before on the deception inherent on the George W. Bush "Ownership Society" mantra, on how this was nothing more than a ploy to perpetuate the belief among the "have-nots" that they could become one of the "haves" in order to continue governmental favortism toward the latter group. The "have-nots" will continue to vote against their own interests only for so long as they can be made to believe it is not against their own interests, and the way you do that is by leading them to believe that they can become one of the favored few that is receiving favored treatment. This is the modern version of the "American Dream." This is George Bush's "Ownership Society."

And the "have-nots" are losing patience with it.

Sunday, March 22, 2009

Saturday Night Special

The Old Timers race at Bristol lived up to my hopes; not a sterling race (pun, as Sterling Marlin won it), but much-loved faces galore. Rusty Wallace was there, being his usual jackass self. Seventy-year-old J.D Ottinger was third. I don't know how Harry Gant gets a few years younger after ten years have passed.

Best of all was Ned Jarrett and his son Dale in the booth. Father and son NASCAR champions and two gentle and lovely men. That combination just kept bringing tears to my eyes.

DeLong Tries

Q: How does having the U.S. government invest $1 trillion in the world's largest hedge fund operations reduce unemployment?

A: At the moment, those businesses that ought to be expanding and hiring cannot profitably expand and hire because the terms on which they can finance expansion are so lousy. The terms on which they can finance expansion...

Um, what "businesses that ought to be expanding and hiring" would that
be exactly? Automakers could maybe make more cars to not be sold. For credit to "flow" there needs to be someplace for it to "flow to."

You don't repair a clogged pipe by filling the reservoir.

Thirty Dollars of Debt...

If I am holding a mortgage on your house and I go to an insurance agent and buy a policy that pays me the money you owe me if you default on your loan, that is a good deal for me, the mortgage holder, and it’s legal.

If the insurance agent, knowing that he does not have enough cash reserves to pay off policies that statistically are going to go into default, continues to sell policies such as the one I just described, he is breaking existing laws. The way around that is to not call them insurance policies, but rather call them “credit default swaps.”

If I am not, repeat not, holding a mortgage on your house and I go to buy a policy that pays me the money you owe me if you default on your loan (to the person who is holding the mortgage), that is illegal. The way around that is to not call it an insurance policy, but rather call it a (wait for it) “credit default swap.” In this case a “naked” credit default swap.

If I’m at all nervous about all of the CDS instruments that I own, I can buy an insurance policy that pays me if they go bad, but such an insurance policy would be illegal and the person I’m buying them from doesn’t have the cash reserves that insurance companies must carry (although he doesn’t tell me that), so these instruments are called “derivatives.” There are other forms of derivatives as well, some of them based on factors as abstruse as the weather on a given future date in East Tonga.

There is also debt secured by your mortgage, the opposite of the CDS's.

If I hold the mortgage on your house and I don't want to hold it any more I can sell it to another financial firm. It happens all of the time. Our credit union sold our mortgage to Citibank.

But suppose that, rather than selling your mortgage, I bought a financial instrument (a derivative) on credit and said that I would put your mortgage up as security against that loan, while still holding the mortgage? That's legal enough, so long as I only do it once. What happens if I do it ten times, or thirty times?

Or I can sell a derivitave which contains assets itself, one of those assets being your mortgage. Again, legal enough if I only do it once, but when I do it many times over I am selling a fraud.
(People also bought "credit default swaps" on the instruments which contain your mortgage, often when they didn't even own any such instruments. It's enough to make your head hurt.)

There is insurance on your mortgage, there are God knows how many “naked credit default swaps” based on your mortgage, there are derivatives based on that insurance and on those “naked credit default swaps,” and there are more derivatives based on those derivatives. If you pay off your mortgage (oddly), all of those financial instruments become worthless. There are other instruments secured by your mortgage, or containing it, worth many times the value of your mortgage, which become worthless if you default on your mortgage.

That is the basis of the pyramid that President Obama let slip on Jay Leno the other night with his little remark about how, when they started looking into finances when home mortgages started going into default, “they found thirty dollars of debt for every dollar of mortgage."

This financial crisis is not about defaults on home mortgages, good ones or bad ones. It's about financial manipulation of amounts many, many times that amount which are based on those mortgages. Whether those mortgages succeed or fail, those instruments have now been revealed as a massive pyramid scheme.

What happens when the true nature of the Ponzi scheme can no longer be denied? If there is “thirty dollars of debt for every dollar of mortgage,” what happens when you do pay off that mortgage? How do the other twenty-nine dollars of debt get unwound? If you default, how does it get paid?

That is the nature of the “toxic assets” sitting on the books of the banks and that the Geithner Plan will buy from them as a price yet to be determined. That will presumably be below face value but high enough to satisfy the banks. The government will hold these “assets” until it can sell them, we are told, hopefully at a profit.

The Geithner Plan says the purchase of these assets will be made by a mix of private investment and government, but if you read the fine print you will discover that the government puts up 97% of the money. Private investors put up 3% and receive 20% of the equity which benefits the taxpayers in some magical way not explained by Geithner.

Probably the same magical way that the “assets” regain their value.

The end result is that banks get rid of worthless paper at a profit, which benefits the stockholders and management of the banks. The management which ran the banks into the ditch get to keep their jobs and their salaries. Investors get equity in something that they essentially did not pay for. And the taxpayers get one trillion dollars added to their eventual tax bill.

As usual, everybody wins except the taxpayer.

There was outrage, appropriate but distracting, when Wall Street looted $165 million from taxpayers in the form of unearned bonuses. Just wait and see what happens when America at large is asked to stand by while Wall Street loots another $1 trillion.

Saturday, March 21, 2009

Food Blogging Saturday

The Original Chopped Salad last night was awesome. Friday night is CPK night at least once a month, and my wife was pleased and not at all surprised at seeing them in the fridge when she got home.

Just as a side note, I did call my sister in Salt Lake City to return her favor of "trying not to gloat" after Arizona beat Utah last night. (You may recall I moved here from Tucson.) I was no more successful than she had been last week when Utah beat San Diego State.

Anyway, I haven't posted a recipe in quite a while, and this one is original with me. I got the idea from the Frugal Gourmet some years ago, but he was doing something else and I created my own recipe. One needs to make the meatballs fairly large, and they are incredibly rich; one or two makes a meal. The recipe I have written down has no quantities on it at all, so I kind of estimated what I use. (I probably use more Oregano than that.)

For those unfamiliar with eggplant, salt treatment removes the bitter taste.

Meatballs with Eggplant
1 Eggplant, medium sized
1 lb lean hamburger
1 medium onion
2 eggs
½ cup bread crumbs
½ tsp Oregano
½ tsp Basil
2 tbsp shredded Romano cheese

Seasoned Tomato Sauce
2 cans Tomato sauce
½ tsp Oregano
½ tsp Basil
1 clove garlic, crushed

Peel the eggplant and slice it into slices about ¼” thick. Sprinkle with salt and let it sit for about twenty minutes, then pat it dry and chop it up into approximate cubes. Prepare seasoned tomato sauce and set aside.

Sauté eggplant with chopped onion until tender and put into a bowl with meat, eggs, bread crumbs, Romano and herbs. Mix that up well and make it into balls. Brown the balls nicely and place them into a baking pan.

Pour your seasoned tomato sauce over the meat balls and bake them for
1 hour at 350 degrees.

Friday, March 20, 2009

Fashion Valley Mall

There are three groups of people at Fashion Valley Mall. First is the people who go to shop at the high-end clothing stores. Second is the group who goes to look at the first group. (Which is well worth looking at; this is Southern California, after all.) Third is a group who goes there to drive around the parking lots talking on their handheld cell phones.

The first two groups are not breaking any laws. The third group is, but I'm not a cop so I don't really care unless they run over or into me in the process, which is a significantly likely occurrence.

I'm not in any of the three groups. I go there because it's the closest location for California Pizza Kitchen and I'm getting takeout. (Well, maybe the 2nd group a little bit. I don't want accusations of being unobservant.)

Obama's Bubble Economy

I watched our President at Costa Mesa the other day, and was as charmed and reassured by him as I always am. Whatever else he knows, he does know how to talk, and I do not mean that disparagingly in any way. When he campaigned he talked about it being the people of this nation who would create change, that he would be the catalyst for that change, and with his “town hall meetings” we are seeing him fulfilling that campaign promise. This is him stirring people to get involved in the governance of their nation. Whether people leave those meetings and actually do anything remains to be seen, but if they don’t it will not be because Obama failed to do his part.

On the economy… Other than to “create or save 3.5 million jobs in the next two years" and to “restart the flow of credit,” it seems the President has no plan for the economy at all other than some vague plan about buying bad assets from big banks. That, on the very face of it, sounds like a pretty bad plan, doesn’t it? “Oh, we’ve got some spare cash, dear. Let’s go buy some bad assets.”

It just feels to me like the one thing he has gotten right he did far too small, and is not being honest with us about that.

The economic stimulus bill was nowhere near large enough, especially when you deduct from it that portion which is actually long range social planning and not immediately simulative. I don’t doubt that it was probably the best he could get through Congress, but he is promoting it as the best thing since Noah built the Ark. Creating “or saving” 3.5 million jobs over the next two years is all very well, but we’ve already lost 6 million jobs since the beginning of this downturn and are still shedding them at the rate of 9.6 million jobs per year.

(The number of laid-off workers taking unemployment went from 5.29 to 5.47 million last week, an increase of 185,000 in one week, according to NPR.org. Do the math. I’m probably being conservative at 9.6 million.)

President Obama endlessly speaks about “restarting the flow of credit so that people can get the loans they need to buy homes and cars.” They aren’t going to buy food, let alone homes and cars, if they don’t have jobs, and in any case buying things with loans is how we got into this mess in the first place. Does he not get that?

Restarting an economy on the same model as the failed one simply doesn’t make any sense. He needs to be talking about a new economic model, a new way of doing business that will work. The people of this nation are not, deep down, stupid. At some level we understand that buying on easy credit is an economic model that has failed us, and confidence is not going to be restored merely by honking the horn of restoring credit flow.

Not Obama’s doing but pursuant to his goal of “restarting the flow of credit,” the Fed announced that it will buy up $1.3 trillion of public debt instruments. Great excitement ensued here in the US, but people abroad started dumping dollars as if they were contaminated. The value of the almighty dollar plunged and, since we import almost everything that we actually use, that is not good news here at home. The Fed’s move may ease up credit, all right, and we may need loans to put food on the table.

The Fed's move is also known as "printing more money" by the way. We have a long way to go before we become Zimbabwe, or even Argentina, and we have much those nations did not have, but this is the road they travelled and it is a bumpy and slippery road indeed, full of pitfalls.

A lower dollar would help us export, except that the rest of the world is in the same downturn we are and the overseas market is as depressed as the domestic one. So the lower dollar, created to give us easier credit, gives us the disadvantage of higher import costs without the advantage of increasing our export volume.

Of course, the lower dollar may merely offset deflation to some degree.

There is broad agreement that firms that are “too big to fail” are contributing to the problem, but nowhere in the Administration’s planning do I hear even a whisper that reform will include breaking these large firms up into smaller ones. So these firms will remain in our economy, forever present to blackmail us with their threats of failure and suck taxpayer money.

In fact, the federal government is creating even more large firms that are “too big to fail” since, as the smaller banks that are small enough to fail do so the government takes them over and sells their assets to a larger bank, making that large bank even larger. If the Obama Administration has any plan for changing this policy they have done a fine job of keeping it secret.

The opposition is, of course, no better. They’re talking about deficit spending (wrong subject at this point, irrelevant) and tax cuts (their version of my mother’s cure all, Neosporin, good for everything up to and including
a broken leg).

Nor am I saying that I know all of the solutions. What I do know is that when a ship runs aground you do not keep the rudder amidships and put the engines “all ahead full.” When you are hard aground and the tide is falling, it is time to look at your chart and seriously consider a new course.

Thursday, March 19, 2009

Counterinsurgency Strategy

All the military genius types are now talking about the US pursuing a counterinsurgency strategy in Afghanistan. We are presumably even changing our entire armed forces into a counterinsurgency type of posture. All of which, of course, guarantees one thing and ignores another.

The next war will not require counterinsurgency strategy.

The quickest, cheapest counterinsurgency strategy is to leave.

Wednesday, March 18, 2009

Old Timers Racing

Saturday night at Bristol Speedway some of the ledgends of stock car racing will be on the track, racing one more time, this time for charity. Junior Johnson will be there; 77 years old and not only one of the original NASCAR drivers, but a real live moonshine runner. Harry Gant, my all time favorite and a true gentleman, will be behind a steering wheel. David Pearson and Cale Yarborough, two of the very best of all time, whose names are spoken in awe.

Thirty-five laps of late model stock car racing at Bristol, and to top it off
Ned Jarrett, the finest voice ever to narrate a stock car race, will be at the microphone calling the action.

Saturday night, 6PM EDT on ESPN2. I cannot wait.

Outrage and Distraction

Just a few things that have not caused as much outrage as $165 Million AIG bonuses:

500 tons of WMD’s that were the proximate cause of a war which has cost us 4000+ lives and $1 Trillion so far, but which have never been found.

$32 Billion cash, vanished in Iraq. We do not even want to investigate where it went.

100,000 weapons disappeared in Iraq, possibly into the hands of people who will use them against our troops. We do not even want to know who is responsible.

$770 Million in frivolous government spending, based on an outlandishly generous assumption that 90% of the earmarks in the recent omnibus spending bill were serious and reasonable causes.

Yes, this issue is an outrage, but it is pennies of our overall financial crisis and it is a distraction. The very President who campaigned against the “petty distractions of politics” is either being distracted by one of those very distractions or is himself using one of them at a time that we simply cannot afford to be so distracted.

To be dealing with hundreds of billions of dollars in stimulus bills, spending bills, and economic rescue bills and have the public, the media, Congress, Treasury and the Administration all fulminating day after day after day over a paltry sum of $165 Million is utterly absurd. To put that into the perspective of everyday life, that’s like running a major corporation with a budget of hundreds of thousands of dollars and fretting over sixteen cents. That is the President of General Motors counting paper clips in Saginaw.

Last month we handed AIG $30 Billion and we are not asking what they did with 99.9% of it, but are screaming bloody murder about what they did with 0.1% of it. No one seems to have asked what they did with $29.835 Billion of taxpayer money or what they are going to do with another $30 Billion which we will give them later this month. Another $750 Billion is in the works to “remove toxic assets” from the books of firms like AIG, and some $3 Trillion has been committed to guarantee debts of even more.

When a small, very small, tempest erupted about earmarks in the omnibus spending bill one of the defenses was that it was a very small part of the total amount. It was 1.9% of that total. Of the hundreds of billions of dollars that have been thrown at the financial industry, and are still being thrown their way, $165 Million is a tiny fraction of 1%, something like 0.00001% or so. The tempest over the earmarks died down in minutes, and this storm of outrage has gone on for days and days.

Get over it and move on. We have serious business to do.

Tuesday, March 17, 2009

Outrage and Acceptance

There is tremendous outrage over the $165 Million in bonuses paid to AIG executives using bailout money provided by taxpayers. Chris Matthews is fulminating about it on Hardball, David Schuster is ranting about it on 1600 Pennsylvania Avenue, Keith Olbermann is pontificating about it on Countdown, and Rachel Maddow is expressing outrage in her unique fashion on her show which merely bears her name. Congress is at a boiling point (Congress!), and even the President is angered by AIG’s outrageous behavior. A veritable Katrina of anger and emotion has erupted over this utterly heinous expenditure of taxpayer funds.

Outrage over $7.7 Billion in earmarks using taxpayer money, not so much.

We calmly accept, with nothing more than the most brief mention in passing, the unsupervised dispensation of $7.7 Billion of taxpayer money by individual members of Congress, but when AIG engages in a similar dispersing of a mere 2% of that amount we go completely crazy with righteous indignation. Earmarks are “business as usual,” while bonuses are “fraud” and “corruption” and “outright theft.”

Every single argument that was used to defend the earmarks in the recent spending bill could be used to defend AIG’s bonus payments. I’m not defending AIG, I’m pointing out the bogus nature of the earmark defense.

“This is last year’s business, let’s move on.” Guess, what. The bonuses are last year’s business too. They are being paid pursuant to business that was brought in prior to the bailout, based on promises that were made to the payees prior to the bailout and in agreement with contracts made prior to the bailout. Whether the business was profitable or not, whether or not AIG was smart to have made the promises, AIG told the traders “get these trades and we’ll pay you.” The traders got the business and now they are being paid.

“It’s only a tiny amount of the total.” Earmarks amounted to 1.9% of the total spending bill which is, admittedly, a very small portion. Not worth arguing about? The AIG bonus we are fulminating about is 1.0% of the bailout money that was provided to AIG. So we freak out when 1% of taxpayer money is questionably spent by AIG, but we calmly accept the questionable expenditure of 2% of taxpayer money by Congress.

“I know best how to serve the needs of my state.” Well, okay, given the state of their business it’s a little difficult to argue that AIG management knows best how to run its own business. I will only observe that serving the needs of individual states (or businesses) is not supposed to be one of the purposes of the United States government.

Should AIG bonuses be “unwound” forthwith? Sure they should.

So should be the corrupt and corrupting Congressional earmarking process.

Update: Tuesday, 4:15pm
My math was off. The bonus is only a tenth of one percent, so we're not comparing 1% against 2% for bonus to earmark, we're looking at 0.1% vs 1.9% which is an order of magnitude.

It's like stepping over $7.70 to pick up 16 cents.

Saturday, March 14, 2009

MWC Basketball Tournament

My sister, presently living in Salt Lake City, is a graduate of The University of Utah. The men's basketball team of that school plays San Diego State University in the final of the Mountain West Tournament tonight. Prior to that, this afternoon, the Utah women's basketball team plays San Diego State University in the final of the Mountain West Tournament. I'm not all that big a fan of college basketball, but I may watch a couple of games today.

Update: Saturday, 10:00pm
Is there some rule in college basketball against offensive rebounding? If so, the refs weren't calling it, because each team broke it at least once without penalty. The deal seemed to be fling the ball in the general direction of the basket and run like hell to the other end.

Just as I was beginning to think this was a hocky game, with seven baskets in the first ten minutes, forsooth, when the announcer commented that the field goal percentages were "less than stellar." That would qualify as a masterpiece of understatement, since Utah was shooting 15% at the time and State was very little better. When you're shooting 15% from the field, you really ought to give some thought to rebounding.

And seldom have I seen one team pull as many utterly boneheaded dumb stunts in a single game as SDSU, such as Utah flings the ball out of bounds so State runs over and touches it so Utah can have it back. Or Utah scores on an alley-oop and shortly thereafter presents State with an alley-oop opportunity only to have State miss the dunk. Or State simply runs away from a dribble ("Oops, forgot the ball."), that was really cool. Given all of that, State did well to stay in the game.

The women's game was a better game, but Utah won that one too. My sister was utterly insuffferable. She called to "try not to gloat." I told her that effort had been unsuccessful and that I wasn't sure how hard she had tried.

Making Things

I listened to President Obama yesterday talking about "the parts of our economy that are still sound" and expressing confidence that, um, whatever. "We'll get through this," whatever that means. Don't get me wrong, I believe Obama is closer to getting this thing right than any of his detractors with their idiotic "spending freezes" and tax cuts, but...

For one thing, if you have a gigantic, malignant brain tumor which is turning your brain into porridge the "parts of your body which are still sound" are not going to do you much good, are they? And I'd like to do something more definitive than "get through this." I'd like to, I don't know, maybe eat and have a roof over my head while I'm doing so. I will have those things, but there are people without that assurance, and I'm not hearing any assurance in that "we'll get through this." Easy for you to say from your perch with not only food and a roof, but servants and personal bodyguards.

He talks about what we need to do to restore our economy to soundness, and what's glaringly missing from the list is that we need to return to making the things we use. His list restores finances and financial manipulators and it provides some short term jobs building infrastructure. Good plan, but what happens to those jobs when the bridges are finished or when the government funding runs out? Does he seriously think we can rebuild a long term economy while still importing manufactured goods on a wholesale basis from another economy, consuming here to support manufacturing jobs somewhere else? I have listened very carefully, and not he or any of his financial administration has ever once said a single word about rebuilding the manufacturing sector, other than automobiles.

We can't afford to lose the auto industry, but apparently we don't need to manufacture anything else.

He's trying to restore confidence and "restart the flow of credit" so that people will start buying things again to get the economy moving. Buying things with borrowed money. Buying things and increasing debt. Buying things and using things. Buying things and using things and filling landfills with discarded toys.

But we won't recover until we regain our greatness at making things.

Friday, March 13, 2009

Comment Not Needed

Scripps Clinic
10666 North Torrey Pines Road, SV4
La Jolla CA 92037

Dear Sir or Madam,

On my statement last month the total balance was $370.57. I determined that an amount of $186.40 applied to current year medical expense, and wrote a check for $184.17 to be applied to 2008 expense and authorized the former amount to be charged to a credit card which is part of my health insurance and charges against my 2009 HSA balance.

On my current statement $77.05 is showed owing on a 12/18/08 office visit, which is not consistent with the $186.40 still showing as unpaid on the 1/06/09 office visit which was shown on last month’s statement. A) Why was not that amount charged against the credit card and removed from the amount owing? B) How is $77.05 still owing on that earlier visit when I paid the entire balance less that $186.40, which is still shown as owing?

On a balance of $370.57 minus my check of $187.14, there is $263.45 still owed?

On the 1/16/09 office visit with Doctor H, the clerical person insisted on charging me a $20.00 copayment, which my insurance card shows as “PCP $20.” My insurer informs me that stands for “Primary Care Physician,” and that when I make that copayment I am not responsible for any additional payment for the office visit, and that it is not subject to deductible. Dr. H is not my primary care physician and I believe I am responsible for some payment, but not for the entire amount, and it may be that you have billed the insurance incorrectly. It may also have to do with my deductible, but I am not willing to pay this amount until I have a better explanation, since the copayment was collected in error.

I called the number on your statement to talk this over with your office, but after waiting on hold for fifteen minutes I gave up and decided it would have to be handled in a manner more convenient to me. You can call me at the above number. I am quite eager to make whatever payment is legitimately owed.


Comment anyway:
Is it that medical billing departments are universally incompetent? Or do they deliberately obfuscate the amounts owed and details so that you will just pay whatever they say you owe them, regardless of the actual amount that is legitimately owed?

New Trick

lego maniaThis is Molly’s new trick, jumping up onto the railing around the stair rail. It’s fairly impressive, actually, for a small cat; the railing is well over waist high, and the top is barely over an inch wide. Usually she jumps onto the part that goes around, and once up there she takes a nice stroll around all three sides. Today she jumped onto the short rail and made a tentative foray toward taking a stroll down the railing that goes down the stair, but she got a little bit freaked out and decided that discretion was the better part of valor on that idea.

Why she’s doing this is unclear, but then she’s a cat. This is, after all, a creature that mastered the art of obfuscation of motive several thousand years ago and pretty much epitomizes the absence of clarity. She does, however engage in this fun practice pretty much daily, and seems quite pleased with herself about it.

You can click on the image for a bigger picture of where she's at.

Thursday, March 12, 2009

The Madoff Issue

So Madoff is going to be sentenced on the 16th of June. I was noticing that date and wondering why it seemed significant. Oh right. It means I get to celebrate my 66th birthday on the 17th thinking about him being in jail. Not a big deal, really, since he's one of the few financeers that didn't pillage my 401k 101k over the past year.

The Battle of Bunker Hill was fought on the 17th of June in 1775. It was also actually fought mostly on Breed's hill, not on Bunker Hill. I have a vast store of relatively useless information.

Wednesday, March 11, 2009

False Choice

I am pro-union, at least that aspect of unionism that includes collective bargaining. I am so in favor of it that I believe that it should be a federally mandated requirement of incorporation that collective bargaining with employees be one of the articles of incorporation. No company in this nation large enough to need the structure of incorporation should be allowed to do business without it. Such a requirement would be good for the workers, for business, and for society.

Rachel Maddow espouses a bill called the Employee Free Choice Act in the following segment. This is a bill loved by labor unions and hated by business groups that makes it easier for unions to gain access to representation of business.

This may be some of the most slanted, dishonest “reporting” I have ever witnessed. Maddow repeatedly says that this act “makes it easier for Americans to join unions.” That's a nice phrase that she came up with to sell you on what a wonderful bill this is. Actually, the bill makes it easier for labor organizations to unionize businesses, and that is by no means the same thing. She has a guy on from the “union busters” who tells a horrible tale about trained professionals who travel the nation assisting businesses resist organizing efforts. He freely admits that they flagrantly break existing laws in the process.

What she doesn’t tell you is that the attempt to organize the business is virtually never made spontaneously by a group of good-hearted employees of the business. The effort is made by a group of trained, paid professional organizers sent in by the labor union, and they are every bit as ruthless in their efforts to unionize the business as the “union busters” whom Maddow decries are to prevent it.

It is undoubtedly true than business has the advantage at this point in the unionization battle (which, I submit, should not be a battle at all), but the solution does not lie in giving countervailing advantage to organized labor. When you have advantage business countered by advantage labor who is in the middle, getting squeezed and losing? Right, the workers.

The solution is to take away the advantage currently enjoyed by business. The union buster on Maddow’s show freely admitted that to enjoy this advantage businesses are flagrantly breaking laws, so enforce the laws. Create new laws as needed, but protect the worker, don’t put that worker in the middle of a squeeze play.

Maddow says that the worker “still has the choice of a secret ballot election if they want one.” That is her other little song, sung repeatedly, to convince you what a wonderful bill this is. The problem with that is you have to tell the union organizer that you want one, and he doesn’t want to hear that. He is here (and away from his home and family, by the bye) for one purpose, and that is to organize the company you work for. Your choice of a secret ballot keeps him here longer and jeopardizes his success. Your signature for organization is what he wants, and he knows the choice you're making.

How can that not lead to threats and intimidation?

We know, in fact, that it can because history tells us that it did. The original labor act called for organization to consist of a signup process that was open, and it was changed to a secret ballot because of the threats and intimidation that the open process created. The unions, I believe, tended to win those open processes because they were the more thuggish and violent, so that may very well be the reason they want to return to it. The “good old days” were not the good old days.

The question itself is an idiotic one. "Do you want a secret ballot election?" Why would the workers not want a secret ballot election? In what possible way does a secret ballot election serve to the workers disadvantage? How, in God's name can a secret ballot election possibly harm workers? There is just no possible way that this bill is written for the benefit of workers.

We need organization reform, but “card check” is not it.

Monday, March 09, 2009

Asymmetrical Thinking

Okay, so the title is a little bit bogus because this is not really about thinking at all. But to the extent that it is about thinking, it certainly is about being asymmetrical.

We are aghast, appalled and horrified that Pakistan is allowing Sharia Law to be established in one of its provinces in the northwest part of its nation. Sharia Law is a set of laws based on Islamic fundamentalism, and we cannot grasp or understand how a nation can allow having laws based on religious fundamentalism. The concept horrifies us.

But we need to have a law, the Republicans maintain, that prevents stem cell research. When a sperm cell penetrates an egg cell something sacred and holy has happened and the destruction of that sacred and holy thing is a great sin. We need laws to prevent the perpetration of that great sin.

My bullshit-o-meter just pegged.

Google News, um News(?)

Like a few million other people, I use the Google news reader for a quick review of what's happening. I've noticed that it isn't real up-to-date, since the same story usually appears on it for quite a while, sometimes several days, but it's a starting point. Today there was this,
stocks fall
So when I clicked on it the link led to this,
stocks rise
I think I need a different news reader. Any suggestions?

Sunday, March 08, 2009

Smoke & Mirrors

One side uses smoke, the other side uses mirrors. In a crashing economy the Republicans say the solution is to cut spending and lower taxes. Democrats say the solution is for the government to spend money. I think both are wrong, and that what is needed is for the government to focus on creating jobs. The latest stimulus bill has some grandiose talk about “creating or saving” four million jobs, but where does it actually do that?

When FDR decided that it was time to kick the economy in the ass, he did not say that it was time to design an Interstate Highway System. He bought millions of shovels and put them in the hands of millions of men who were out of work, and told them to build some roads, campgrounds, dams and canals. The roads were not grand works carrying vast numbers of cars at high speed, but that didn’t matter because the roads were not the point. The millions of shovels in the hands of millions of workers was the point.

No one can point to anything in the stimulus bill and say, even to within a degree of magnitude, how many jobs that item will create.

Defenders talk about the greatness of the projects in the bill, and how well the projects serve the needs of the nation, but economic recovery is not about projects. Economic recovery is about jobs. We should not be talking about projects at this point, and FDR got that. FDR didn’t talk about road building, he talked about jobs and specifically how many jobs would be created and when they would materialize. They would be available immediately, he promised, not some indefinite time in the future.

The stimulus bill contains $8 Billion for high speed rail. It’s not the “magnetic levitation from Disneyland to a Nevada bordello” that the Republicans tout. It is very much the worthwhile and valid social expenditure that the Democrats claim. But how many jobs will it create, and when? No answer. This project is not only not off the drawing board yet, it is not even on the drawing board yet. No one even knows where the money will be spent. It will create some jobs, certainly. What state will get these jobs? How many jobs? When? No answers.

It’s a great project, a worthy project. But what does it contribute to current economic recovery? No one knows the answer to that, and the answer may be, might be, “nothing.”

As such, it detracts from the economic recovery bill, because that $8 Billion could have been spent on something that has a known ability to stimulate immediate economic recovery; something that creates a known number of jobs in a definite time period.

Given that we do not know specifically what the project(s) will consist of or where it (or they) will be located, how did Congress arrive at that amount of $8 Billion? What makes $8 Billion the right amount to spend on this effort? Did the Democrats come up with it the same way that Henry Paulson came up with the $700 Billion for the original TARP? You may recall that the only answer we ever got from Treasury to that question was something to the effect of, “It sounded like a good number.”

That $8 Billion was put in the bill not because it would create any jobs, but because Congress was focused on the grand idea of simply spending money. The whole stimulus bill is about spending as much money as possible and hoping that some jobs will result. That’s rather like signing the mortgage before you even look at the house. It’s the ineffable “cart before horse” philosophy.

This is the Democratic version of “Trickle Down Economics.” Spend money and hope that it trickles down and creates some jobs. They should be focused on creating jobs and then allocating funding to make those jobs possible. There’s nothing wrong with spending money, but it is just plain stupid to spend it merely for the sake of spending it and wind up buying the proverbial “pig in a poke” with it.

Throw money up in the air and hope somebody creates jobs with it.

There is the portion of the stimulus bill that provides money to states; money to allow states and municipalities to continue operations. That portion of the bill, a portion rather much smaller than it should be, does have a significant focus toward jobs; albeit one of saving jobs rather than creating them. There has even been solid evidence of its efficacy in 25 police cadets restored to an academy and graduated this past week as a direct result of the passage of this bill. So 25 police officers will have jobs.

But 25 doesn’t stand up well to the 651,000 jobs lost the same month.

And $8 Billion in high-speed rail funding is still unspent.

Friday, March 06, 2009

Values & Values

Some people listen to Paul Krugman. Some people don't. I listen to (read) him, but I don't always understand what he is saying. When I do understand him, or think I understand him, he usually scares the bejeezus out of me. Today's linked op-ed column is just such a case.

One paragraph sort of jumped out at me,
Thus, in a recent interview Tim Geithner, the Treasury secretary, tried to make a distinction between the “basic inherent economic value” of troubled assets and the “artificially depressed value” that those assets command right now. In recent transactions, even AAA-rated mortgage-backed securities have sold for less than 40 cents on the dollar, but Mr. Geithner seems to think they’re worth much, much more.

What I'm getting is that the Obama administration thinks that these "assets" have an artificially low value right now, and that they will return to the original values someday. Everybody else thinks we were in some kind of "bubble" and that their value was artificially high; that the values have now come down to their natural levels and aren't going back up much, if at all.

Krugman thinks the Obama Administration is going to just dither around until we find out who is right. That will be wonderful if Obama turns out to be right, but it will be an awful mess if everybody else turns out to be right. I'm seeing the self-justifying drill team mommy at work by the Administration,

"Oh look, everybody's out of step except Johhny."

And Exuberance

Another 651,000 jobs were lost in February, so the stock market is up. Yes, up. Who is buying those stocks based on 651,000 jobs lost in one month? It sure as hell isn't the 651,000 people who lost their jobs. Traders were expecting 680,000 jobs to be lost, so they are buying stocks because a mere 651,000 jobs were shed. So 680,000 is a big number, while 651,000 is a small number, a wonderful number, an encouraging number, a number that indicates in the fevered imaginations of stock traders that our economy is recovering.

I somehow doubt that such a number is very encouraging to the 651,000 people who are in that number.

Update: Friday, 12:30pm
Well, I see it's down again, but it was trending up when I wrote the post and the reason that was being given was that "February job losses were less than predicted."

Thursday, March 05, 2009

Healthcare Money Pot

I’m not trying to display wisdom with this post like I usually do. Okay, let me start over, since that didn’t go well. This post poses a question to which I do not even think I know the answer. How’s that? If anybody knows of a source that provides an answer, a pointer to it would be much appreciated.

Take a big pot and start throwing money into it:
~ all of the money individuals pay for health insurance premiums
~ all of the money companies pay for employee health insurance premiums
~ all of the money people pay in copays and deductibles
~ all of the money people pay in “not covered” medical expenses
~ all of the money deducted from paychecks for Medicare
~ all of the money paid for medical care by people without insurance
~ all of the out-of-pocket losses to providers due to unpaid medical bills
~ all of the premiums paid by people for Medicare coverage after retirement
~ all of the amounts paid for Medicare/Medical copays and deductibles
~ out-of-pocket losses due to medical crisis-related bankruptcies

How far would the money in that pot go toward covering the cost of medical care, not “healthcare,” medical care of every single American?

I’m talking about a system that provides a reasonable profit for the organizations which provide the medical services, but a non-profit basis for the organization that provides for payment to those medical providers. Yes, I’m talking about a single-payer system.

People are asked if they are willing to pay higher taxes for universal health care, and a surprising number answer in the affirmative. But I wonder if we are asking the right question. Given the amount of Medicare taxes withheld, the health insurance premiums you pay and the amount of out-of-pocket expense for medical that still remains, would your cost actually go up?

Wednesday, March 04, 2009

Food Blogging Wednesday

The food section in today's paper had a special feature on oatmeal recipes; bunches of oatmeal recipes sent in by readers.

I actually didn't know there was such a thing as an oatmeal recipe.

Update: Thursday, 1:00pm
The only oatmeal recipe that would meet with my approval would involve a garbage can or, perhaps, a disposal. Maybe a large bonfire or even hand grenades. Flamethrowers?

Higher Economics

Here's more from Obama himself (emphasis mine),
Sweden, on the other hand, had a problem like this. They took over the banks, nationalized them, got rid of the bad assets, resold the banks and, a couple years later, they were going again.

All this talk about "getting rid of bad assets."

News flash; if it's "bad" it isn't an "asset."

The things they are talking about are things that the banks paid good money for that are now worth squat. You get rid of them by throwing them in the trash. Who needs help doing that? Why do you need to buy out a bank to enable it to throw away its trash? I have a bucket of trash bad asset in my kitchen; why isn't the government buying my house so I can throw the damned thing out? My wife thinks I can throw it out without any help. Damn fool; she won't let me wait for Obama to buy our house.

Apparently my wife doesn't understand economics.

Tone Deafness

I voted for Obama, and I would do it again in a heartbeat. I am one of the 84% that approves of the way he is handling the office of President. He is, I believe, a genuinely good man who wants to do right by the people of this nation. The number of campaign promises that he has already made good on is astounding. So far as I can see, he has yet to renege on any one of his promises. He has big ideas and the ability to convey those ideas in a manner that can turn them into reality.

And yet at times he can be amazingly tone deaf.

He talks about the stock market numbers as if they are a trivial affair; talks about the numbers “bouncing up and down” and blithely says that he pays no attention to them. Those numbers are our pensions; our IRA’s and 401k’s and our plans for life after we are no longer able to work. And they are not “bouncing up and down,” Mr. President, they are dropping like a stone in a millpond. We cannot be as cavalier about those numbers as you appear to be.

Those numbers are sucking the life out of us and you blithely say that they don’t matter to you. They matter to us. They matter a great deal to us.

He has this fetish about “restarting credit” and “consumer spending.”

He's talking about spending while jobs are disappearing at a fearful rate.

Almost three quarters of a million jobs were cut last month. If I don’t have a job, I am not going to take on a major loan and buy a house. A “tax credit” is not going to be very persuasive when I don’t have an income upon which I am paying taxes. If I have a part-time job because it’s all I could find when my career job was cut, I am not going to take on payments for a car loan and buy a new car. Again, a tax credit is not going to persuade me when my very income is at risk. When I can barely feed my family I am not taking on loans for cars and houses and flat screen televisions, and tax cuts are not persuasive. Taxes are tomorrow, loan payments are today.

Show me the jobs. Show me a month in which more jobs are created than are lost. Show me jobs that pay more than minimum wage. The people of this nation do not need spending, Mr. President, we need income.

When you have accomplished the first part of that formula, when you have provided the money in our pockets, then talk to us about spending it.

Tuesday, March 03, 2009

F/A-18 Crash

On Dec 8th a Marine F/A-18 crashed into a San Diego neighborhood, killing four. The Marine Corps has just completed its investigation of the events leading to the crash and, to its very great credit, is making those results public. I have been hugely impressed with the calm and sober demeanor with which the Corps has announced a series of grievous errors that led to the loss of four lives; lives which it is dedicated to defending.

The pilot was repeatedly offered the chance to land at North Island Naval Air Station, which would have provided him an approach entirely over water. He declined because he was not familiar with that runway and was more comfortable attempting to land his crippled jet at Miramar. He should have been overruled by ground control, and was not. He knew from the beginning of the incident, before the choice of landing site, that his sole remaining engine was in trouble. He did not follow checklist procedures for the trouble indicator lights that he was getting.

The list goes on; error piled upon error. Four officers relieved of command; others reprimanded; the pilot grounded pending a hearing. Punishment not in retribution, but to maintain a standard of excellence.

Clearly, the Marine Corps has been as saddened by this as we have been. Their news conference has made that quite plain, and yet they have not engaged in inappropriate breast-beating. They have a job to do. It is a difficult and dangerous job, and a necessary one. It is a job done by imperfect human beings. They do their job with amazing skill, but they do not do it perfectly.

God help us all if they ever decide it cannot be done, for any reason.

Monday, March 02, 2009

Alarm! Alarm!

Okay, the title is bogus. Yahoo News posts an AFP news item that starts as follows,
LONDON (AFP) – The euro fell sharply against the dollar on Monday after European Union leaders ruled out a regional bailout plan for Eastern Europe at a weekend summit, analysts said.

Sharply. It went from 1.2671 Euros/Dollar to 1.2603. That amounts to a bit less than one-half of one percent. Sharply indeed.

I wonder how they would describe a ten percent drop.

CPAC Knee Slapper

Comedian Rush Limbaugh (as Keith Olbermann puts it) gave a real knee slapper at CPAC Saturday night. I watched as long as I could, but finally grew tired of the self adulation and gratuitous sliming of opponents and turned him off. A few jewels of wisdom from this font of wisdom were slightly less unworthy of comment that the rest of his diatribe.
We believe that the preamble to the Constitution contains an inarguable truth that we are all endowed by our creator with certain inalienable rights, among them life. Liberty, Freedom. And the pursuit of happiness. Those of you watching at home may wonder why this is being applauded. We conservatives think all three are under assault.

Many have noted the he got the document wrong; that the quote is actually in the Declaration of Independence. He also misquoted, as the word “freedom” doesn’t belong in there. It’s “life, liberty and the pursuit of happiness.” And to top it off, he lists four things and than says that “all three of them” are under attack. And people cheer.
Also, for those of you in the Drive-By Media watching, I have not needed a teleprompter for anything I’ve said.

I daresay you do not. Maybe that’s why you don’t know what document you are quoting from, why you botch the quote and why you cannot remember from one sentence to the next what you said. Or perhaps you merely cannot count higher than three.
We can take this country back. All we need is to nominate the right candidate. It’s no more complicated than that.

He didn’t say who that candidate might be, but I suspect this comment rather annoyed John McCain and Sarah Palin.
How did the United States of America become the world’s lone super power, the world’s economic engine, the most prosperous opportunity for an advanced lifestyle that humanity has ever known?

Perhaps the same way the Ottoman Turks did it, and the Greeks did it, and the Romans, Holy Roman Empire, French and then British did it? Maybe the same way that whoever follows us will do it. Or do you think we are the “Thousand Year…
Some people are just going to work harder than others. Okay. You get what you work for. Those who have a genuine inability for whatever reason are taken care of.

But you are vowing to end welfare. Your entire diatribe prior to this point disavows “genuine inability” with its “everyone can succeed” mantra.
Well, the one thing, and there are many, but one thing that we can all do is stop assuming that the way to beat them is with better policy ideas right now. I don’t want to name any names. It’s not the point.

Well you certainly can’t beat them with your present policy ideas, insofar as what you have actually are policy ideas. What you mostly have are their policy ideas with the word “no” tacked onto the front.

And I love this not naming names thing, this thing of it not being the point. Fact is, he only knows one name, and that name is exactly the point.
What they mean is: We check our core principles at the door, come in, let them run the show and agree with them. That’s bipartisanship to them. To us, bipartisanship is them being forced to agree with us after we politically have cleaned their clocks and beaten them.

He actually said this. I have been amused by the endless whining of the Republicans about being “left out of the process” as a minority after, for six years in the majority, they literally locked the minority Democrats in the basement. They literally do believe that the meaning of bipartisanship does depend on who won. They literally do believe that bipartisanship has a “heads I win tails you lose” kind of meaning. They don’t just want it to be that way, they actually think it is that way. Amazing.
All the tea parties that are starting to bubble up out there. Those are great. Fabulous.

Tea parties. I thought this was the invention of a bunch of wingnuts, and now I find it is actually sanctioned by the head of the Republican Party.
Oh, wait.

“Tea bag the Dems before they tea bag you.” Right.

Keeping Us Safe

A man was wearing a tin foil hat to work every day and refusing to take it off for any reason. Finally one co-worker got up the nerve to ask him why he was doing such a nutty thing.

"To protect myself from space aliens," he replied.

"You silly ass," his co-worker said, "There's no such thing as space aliens."

"See," the man smiled, "it works, don't it."

George Bush took us to wars in Iraq and Afghanistan to protect us from being attacked by terrorists. Um, it worked? Self protection Limbaugh style.