Friday, April 29, 2011

Past Utopia

It does seem common to look to the past and see a better world that we have abandoned. Whether it is the disillusioned Tea Party member with a shaky grasp of the constitution and the US of the 19th century or some group trying to help isolated/tribal peoples.

It's almost like a weird variety of backwards optimism: look back to times that were in fact much worse, but see the good things only. I suspect it is because things don't seem to be going well in many ways right now. Really, though, as bad as things seem right now, an unemployed American today is much better off than a industrial laborer 100+ years ago. It is certainly true that the poor in many places are still very badly off by America 100+ years ago standards, but even in those cases most people are better off today than they would be in the same place a century ago (not all, most).

100 years from now, this will most likely hold true again. US debt/deficits, the growth of China's economy, the European monetary union becoming the world standard currency (or it's becoming completely undone by present backwards thinking), oil itself going the way of the dinosaurs, none of that will lead to a worse world a century down the line.

That said, there is one present problem that does have the possibility to turn things around dramatically and that is climate change. It could be that we end up better off despite global warming or, indeed, even because of it, but it could also be that shifting climate causes too much damage for us to recover from in time and that we face a serious contraction in global wealth, with the resulting starvation/war/displacement that will come with it.

Since I live in the US, there is a better chance that things will improve for me even if they are worse for the world at large, and even if they don't improve I'll still be better off than most of the world (well my descendants as I'm all but certain to be dead 100 yrs from now).

Tuesday, April 26, 2011

Common Sense

I liked reading this--and her book may be good, though I'm not compelled to read it. There exists wisdom that could be described as common sense, but not much. Even "common sense" teachings could be wrong from a different perspective: the "hand in the fire" example isn't quite right if your hand darts in and out quickly or if you are wearing an asbestos glove or if the fire is a low temperature one.

In fact the more "common" some bit of sense/wisdom/advice is the less likely it is to be useful when it comes to big questions. Uncommon sense makes for greatness. People who are able to see things differently and understand them differently and come up with better responses. This is true in business, personal life, and government. I'd rather a government that was great than one that was common.

Not Voting For Him in 2012

Just saying.

Monday, April 25, 2011

Bully Pulpit

Would it really hurt Obama that much to give a speech to the American people where he said what would be best for the country (not what was politically feasible, not the "starting point for negotiations" but what would actually be best...according to experts not politicians)? Then, after that, he were to say that politicians unwilling to do the right thing for the good of the country are weak, and are cowards, would that be bad?

I know that the chattering class of DC pundits will get all worked up about him being mean or some shit, but the president should lead. And if the members of the US House and Senate are going to continue to be more beholden to bankers and other moneyed interests than they are to the United States, then maybe that should be pointed out with all the harshness it deserves.

Does anyone really think that the American people would be upset with a president that did such a thing?

Tuesday, April 19, 2011

Um...Yes They Do

Matt Yglesias is a decent blogger, but this piece defies reason. I will grant that the exact cause and effect are murky, and that correlation does not prove causation, but housing prices historically--until the recent housing bubble--have tracked wages very well. Not general inflation, but wages.

This is for good reason: in a sensible marketplace (not a bubble) the amount of house a person can buy is very closely linked to their income. The mass of housing must, as a consequence, be priced to the income of the people who will be purchasing it. While house prices are more complex in that they are hyper-local, the wonders of large numbers takes care of the discrepancies between my neighborhood and the one 4 miles south.

If New York were to have the incredibly expensive housing it does but incomes that were half the national average, then the fact that no one could afford it would cause prices to crash as sellers tried to find a buyer. Rents would also plummet.

Now I will grant that there are other things that affect prices, and that the price to income ratio in New York is likely to always be higher than the national average due to land scarcity. Codes, accessibility, commute, along with land scarcity do affect prices, but those things don't change as much if at all, so the real determining factor for what housing will cost in an area is the income of the people that live there.

Maybe Matt really just means that housing prices and income actually are both tracking an area's productivity, which is true, but if that is what he was trying to say then he should have started with that and not the other garbage.

Monday, April 18, 2011

45% US Households Pay No Federal Income Tax

That number is too large, and the breakdown is very predictable. Lowest income households are the largest fraction, but there are plenty of higher earners who pay little to no taxes as well.

There are good and bad reasons to have tax credits/deductions, but ideally we shouldn't. Good reasons should be dealt with differently (public college should be free for in-state students), and bad reasons should, well, just be eliminated.

The vast majority of households should pay income taxes. I'd be willing to lop off the bottom 10-20% for zero liability, but it should be done as a tax bracket: the bottom bracket (up to, say, $15k) pays 0%. No dependents, no housing deduction, no deduction for other income taxes paid, no deduction for charitable contributions.

The simple removal of those would be bad for many people, however, so it would need to be done in conjunction with overall tax overhaul that would cause taxes for most people to not change too dramatically. For political reasons this is not likely to happen any time soon.

Sunday, April 17, 2011

The US Government is not a Household

Part two I suppose, but really, just go read the rest of this:
There are several reasons why this is wrong but the one that causes the most confusion amongst the man on the street is not realizing your personal control over spending versus revenues is essentially the exact opposite of the governments control over spending versus revenues and that this is more or less by design.

Thursday, April 14, 2011

Comment on Frum

As a big aside on the Obama/Ryan fanciful budget planning commentary going on, I've got something to say about this David Frum piece. It's a fine piece for what it is, but this caught my eye. Frum writes:
Those of us on the political right have different preferences. We believe that low rates for high earners accelerate economic growth. We believe that the cost of Medicare must be restrained. And I think we have a lot of good arguments on our side.
This paragraph is interesting for a couple reasons. First he states pretty much straight out that tax cuts for the rich and spending cuts that will negatively effect everyone else (specifically the elderly in this case) is the GOP ideal. This isn't really insightful or surprising, anyone who's been paying attention for the past 20+ years knows this. But the second bit here is very compelling.

He says that he thinks they've good arguments on their side. Not evidence. The thing is, that there is quite a bit of actual, honest to goodness evidence on whether higher taxes and more social services or lower taxes and fewer social services produces a better society. The evidence is very, very strongly against them. All they have to support their preferred policies are arguments. That should be devastating. The right has arguments, the left has evidence.

The evidence (from our own history, as well as taking a look at the many examples provided in countries throughout the world) is that higher taxation along with more government provided services produces a healthier, happier society. They can argue all they like. I have evidence on my side and evidence wins.

Wednesday, April 13, 2011

Equal Pay Day

Was actually yesterday, and there are some frustratingly amusing tips for working women to be found here. I've certainly commented on this before but to abbreviate...

Men and women should be paid the same for equal work.
Sexism is alive and well.
Male/Female salaries are likely never to be equal based on current methods for evaluation.
There are good reasons for this.
There are bad reasons for this (sexism mostly, in different ways).
There are make believe reasons for this.

It is possible that at some point in the future that home/work roles for males and females will have completely balanced out in perception if not in fact, at which point the number will (probably) finally be equal. I would love that to happen, but it won't in my lifetime. It just won't. What will happen in my lifetime, is that actual pay for actual work will balance out.

Sarcasm From CNN Money???

Hard to believe but here it is. Bankers are back to being masters of the universe it seems in most places, so it's nice to see this article.

It also includes a link to this older winner back when it was still very acceptable to bash bankers. Very refreshing...until I realize that nothing will come of this. Banksters rule our petty little lives.

Tuesday, April 12, 2011

He'll Still Win.

The fact remains that most Democrats are bad Democrats. Obama can sell out the entire Democratic party platform, and will still get votes from the vast majority of Democrats. Republicans can't do that as much (though, to be fair, the only part of the GOP platform that is in any way sound is: tax cuts for the rich).

So long as this is true Democratic politicians will continue to sell out their base for political gain from the right. The part where this becomes really frustrating, however, is when selling out the base makes things worse for the country in real sense, because that does more harm to election prospects than whatever few right of center votes the Dem manages to pick off. As such: cutting spending during a recession is bad, and should be called out as such. Tax cuts for the rich--almost any time but particularly when money is tight and the rich are doing quite well--is bad and should be avoided at all costs (it was not).

Is Obama a Secret Republican???

Hey, it's more credible than the Kenyan/Muslim bullshit. Let us do a rundown...
  • Gitmo still open? Check.
  • Still mired in wars? Check.
  • GOP health care? Passed.
  • Cheering spending cuts? Check.
  • And defense spending? Pretty much untouched.
  • Tax cuts for rich? Extended.
  • Prosecution of torture? God no!
  • Treatment of whistle blowers? Bradly Manning - strip!
  • Unemployment 8-10%? Fire gov employees.
  • More stimulus? Nah, cuts!
  • The stimulus? Must have tax cuts!
  • Banksters? Big bonuses for everyone!
  • Regulation? Pfft.
  • Gays serve in military? Thanks mostly to courts.
  • How about marriage? Meh, courts can do that too.
  • What about the court? Replaced the leftmost justice with a moderate, now it's more right leaning than ever...but the new justice is a woman, so minor win (Note: I really like Sotamayor and Kagan isn't necessarily bad, but likely worse than who she replaced).
Now, I liked Obama a lot when he was running and he hasn't had the easiest of times to deal with as president, and he has had the most dysfunctional Senate in history (seriously, it was worse than the present House), but all told, his messaging and his actions independent the legislation that got through and to him have been colossal fails to me. It's like someone took Bob Dole and gave him Clinton's charisma. I don't get it. I don't like it.

I knew going in that he seemed to have an odd fetish for compromise and bipartisanship like all too many people in D.C. but he also seemed quite smart, so he would know not to compromise with himself prior to sending a bill to the floor. He would know not to take GOP talking points as his own which just makes it harder to get things done. He would know that, in the end, Republicans were fighting him, not the positions, and he would have to make bills much more liberal, so as to get the compromise back, to get them to have a real stake in things. He would know that if the GOP can get what it wants while still opposing it and voting against it, then they would do just that.

He doesn't seem to know these things. He is either taking a long view that doesn't mind lots of present pain, or we have collectively mistaken calm for thoughtfulness.

Monday, April 11, 2011

The Mild Obama

I often wonder how much Obama and his staff read actual liberal opinion pieces like Krugman's column, and, more, if they pay them any mind whatsoever. It seems like if they do, the reaction is more along the lines of "Ok, [liberal pundit X] just said [something sensible] so we need to go and do/say the opposite to prove that we aren't liberal!" And then there is cake.

However it plays out, Obama has been an excellent Republican president. A pretty horrible Democrat, but an excellent Republican. So, unless you agree with the "Moral Relativism" argument (I don't) I don't really understand how any Democrat can be even a little excited about 2012. Since Obama is going to be the "Democratic" candidate for president we already know that our options are going to be: Crazy Republican or Sensible Republican.

More on Banking

As much as I tend to hate on banks, I feel like I should occasionally say, "Banking is a necessity in our (indeed in any successful) economy."

We need banks and banking. What we do not need is a financial industry with so much clout and, one could argue, collusion that it becomes the massive GDP machine that it is. The large number of banks combined with the relatively do-little approach to earning money that they operate on should mean that profits are razor thin.

The basic principle is: take money from one person/group, lend it to another, charge interest on the loan, get profit in the form of interest. This is such an easy way to make money that the field should be packed...and it is! Now, I'll grant that figuring out how much to keep vs. lend out and the need to determine whether a borrower is worthy of credit are somewhat more complex, but by this point in time those calculations have been done over and over (not that they are spot on, see the financial crisis), and any new entrant banker can just take the safest approach to start.

The fact that there are many banking options out there and that banking is very profitable are at odds, and the resolution of these two things is that banks are evil...despite the fact that they are necessary and, in fact, good for the economy as a whole.

Saturday, April 09, 2011

The "Energy" Discussions We Should be Having

The word "energy" is a bit of a problem in the whole discussion of energy that is forming up in this country. Scientifically, a Joule is a Joule, and whether it comes from oil, gas, wind, coal, solar, wave, geothermal, hamsters running in hamster wheels, doesn't really matter. But in practice it does, and absent a revolution in politics we need to be having 2 almost completely separate energy debates.

Whenever you hear someone talk about "energy independence" they are actually talking about oil. Oil is an all-by-itself discussion that has almost nothing to do with "energy" as people often think about it otherwise (the wall outlets in your residence). Our oil consumption is almost entirely dedicated to transportation, that is to say, petroleum based fuels (like gasoline and diesel). We certainly use petroleum for other things, but they are beyond secondary.

In this discussion, the single most important thing to know is that it is not possible for us to drill our way out of this. We don't have enough oil reserves to EVER be independent, unless we dramatically reduce the amount of oil we consume. This problem is then all too often tied to renewable/alternative energy, but this is also a huge mistake. A wind turbine cannot refill your gas tank...unless you drive an electric vehicle.

The only way for the US to ever be independent in terms of energy (oil) is to reduce fuel consumption by close to 90%. This is not possible without some pretty serious changes in driving/vehicles/infrastructure. Any time a politician talks about "energy independence" they are using talking points and not being serious (I mean any time, and any politician). Energy independence is a rouse, because the only serious answer is to stop driving petroleum burning vehicles, and no politician would ever dare suggest that.

The second discussion has to do with energy in the form of electricity generation. This is where renewable and clean energy come into play. This discussion has nothing to do with energy independence (we produce lots of coal and natural gas and do our own nuclear and harness our own wind and geothermal and sunshine) but about environmental and economics issues.

Dealing with this side of the energy coin is not as straightforward. When it comes to oil and independence it's pretty easy: we don't have enough so the only way to become independent is to use much less. On this other side of the energy equation, we have a massive economy, and lots of resources, but we also have environmental concerns and a potentially larger economy and the real problem of sustainability going forward. The ideal solution would be to transition "dirty" power generation to "clean" generation in a nice seamless way. Of course that isn't possible, and seamless would mean very slow and that may not be a good idea.

There are arguments about what "clean" energy is and can be with some people claiming coal can be clean (probably not), others who complain that dams destroy ecosystems (they do, but may not need to...and it may not be too bad anyway), and still others who think that wind turbines kill birds (seriously?). Just to be clear, there is no such thing as zero impact energy generation. If we claim energy from some source that is removing some fraction of the energy that would have been dissipated/taken up differently.

Then there are arguments about what it will mean to the economy. Transitioning energy generation and transmission in this country will create new jobs/industries and we will destroy existing jobs/industries. The actual impact is a lot easier to figure in the destroy category, since we know what those industries are, who they employ and how much GDP they generate. Any attempt to figure how big the new industries will be is a guess. It may be a good guess, but it is still a guess. More it isn't concrete. You can't point to a 5 year old and say "That child will have a six figure salary in the new energy economy, but will be lucky to get a $40k/year job otherwise," but you can look at some child's father and say "You will be without a job in x years if we go forward, and you will need to figure out how to do something different."

Those are the two overarching discussions 1) Oil, 2) The Grid. The first is easy enough to deal with in principle, but no one in a position of power is or will do anything about it. The easiest thing to do here would be to have gasoline cost $8/gal...again easy from the "fix" perspective not the people perspective. The second is difficult in all aspects. It is hard to lay out the problems and the solutions. It is hard to determine which way forward is/would be best, and it is very hard to figure out how to deal with the negative consequences either way.

Thursday, April 07, 2011

Ah, Moral Relativism

I'm not sure if Mark really gets what he's saying or not, but, if he is himself a liberal, then his advocacy in this column represents a huge win for conservative ideology.

Short explanation: you can play his game and substitute Mitt Romney for Obama against a whole slew of other potential GOP candidates and your conclusion would be the same "The others are so bad that really Romney is a blessing for liberals!" Again, I don't know if he doesn't understand this or just doesn't care, but it's about the best guaranteed losing strategy the left in this country could go with.

Monday, April 04, 2011

How to fix the mortgage mess?

If you are John Stumpf of Wells Fargo the answer is: well, never actually given, despite that being, you know, the title of the piece.

He talks around why you can't just hop back to the way things were done 30+ years ago, but that's it. He says government should do something. what? And that banks and homebuyers should all have more "skin in the game"...probably, but he won't actually say to what extent.

Sunday, April 03, 2011

Why Religion Sucks


Ok, it may be a bit over the top for a headline, and is very Bill Mahr in tone, but one bigoted hateful pastor in Florida burns a Quran, and then a whole slew of violent protests result that basically give credence to what bigoted hateful pastor says about Muslims.

Here's an easy guide to are you, as an individual, an evil representative of religion or a good representative of religion.
Have you ever burned the holy book of another religion? (Yes = evil)

Have you ever attacked/destroyed people/cars/buildings because some jackass burned your holy book? (Yes = evil)

Have you ever held congressional hearings on how members of one particular religious group are out to destroy your country? (Yes = evil)
Note: answering "No" to the above doesn't make one a good representative of anything, just not an evil one.