Our Horrible Democratic President

I wish Howard Dean had won in 2004.  Obama has had another campaign in which he sounded like maybe he would actually govern as a Democrat this time, and has followed that up by being the ONLY person to actually propose cutting social security.  "Evil scumbag" comes close, but I'm not sure it really covers the very conservative Republican friendly Obama budget proposal. 

I don't agree with Dean on everything, but if he leaves, I'd be likely to follow.

How to Educate

I'm very torn about things like this new testing program in NYC.  Atrios is certainly correct that wealthier students in general will do better due to parental/money involvement.  This means they get better schools/teachers and will be better educated/prepared for college, meaning they will get into better colleges...

The other side of this is harder to state: no matter the reason that they are more advanced, it is not a good idea to hold back some children to bring others to their level.  I think where this goes astray is that a lot of districts are kind of backwards.  Advanced children (whether because of their own ability or because mommy and daddy have lots of money) don't need the best teachers and schools.  They will learn just fine with below average teachers.  The downside, of course, is that if the best teachers are not teaching "their" children "they" will pull their kids out of the schools: either going to the suburbs or moving them to private schools.  Advanced children without wealth will be less likely to have as much of a benefit in this case.

This is a nearly impossible problem to get around without lots of money and a less parochial system.  Basically, if we could setup a system that the worst schools in the country had the best paid teachers (I'm talking six figure starting salaries) and the best performing had the lowest (say $30k starting) then we could guarantee that the least advantaged students would get the best teachers.  It would really require pretty heavy federal intervention in public schools, however, to prevent wealthy suburbs from creating price competitive schools.  (Note: there will be private schools in either case, but even private schools would have a hard time matching a minimum teacher salary of $120k plus benefits.)

I'm thinking something like having all teaching jobs on a scale with a few variables: education level (+/- 0.5), experience (+/- 0.5), school rating (+2 to -1).  Most schools would exist on a +/- 1 continuum with a few very challenging schools over +1 (so median school would be 0).  A value of 0 would correspond to a median teacher salary of, say $47k.  +1 would be double that, +2 triple, +3 would be 4x, -1 and below would be half.  That way no matter how much education and experience a teacher has, she/he could never do better than the median at the easiest schools.

Bit O' Fun

Not really sure it's as big a gotcha as some of the people commenting on it imply, but it's still fun to watch:



Anyone who thinks the government funding of science is a bad idea is a total fucking idiot.  The economic argument is actually more complex than "Well, if it is a good investment then the private sector would do it."  Much like infrastructure, lots of really good investments for the economy as a whole are actually pretty crappy investments for individual companies.  In general improving human welfare provides a lot of economic benefits, but not necessarily of a direct nature.  Think about science involved in cleaning up pollution (including CO2)...

Reducing the pollution levels has major health benefits, but the people doing the cleanup don't really reap those rewards.  The benefit is that more people live longer/better and can do more/better work.  This means that people contribute more to the economy, and since taxes cover the whole of the economy the government benefits.  Because of the broad nature of the benefit, only the government can justify the cost, because only the government has the size and reach to claim the return on investment.

I'm Not Actually Against It

When I was talking about the boondoggle of private investment in public infrastructure I wasn't really clear that I was particularly against the banks and these other stupid schemes to skim more government money off to a handful of well connected individuals and businesses.

Private enterprise does, often and without problem, invest in public goods, including infrastructure.  The mechanism for this has been and should be bonds.  Those bonds can be targeted to a specific thing, and some dedicated revenue stream (taxes, tolls, ...) can be set up to be used only for payment on those bonds, but that is how "investment in infrastructure" has and should work.

Unbelievable

Our most-liberal-president-evah™ is the first politician to officially endorse cutting social security.  Republicans are going to hang this on every Democrat in 2014, and the Democrats' only chance at surviving this colossal mistake is to separate themselves from this plan and idea.  Let's just hope that the Republicans are too stupid to take the deal, and that Democrats are not so stupid that they go along with it.

I Like My Leatherman

Digby quoted some interesting commentary (yesterday).  I could be reading her comments about it incorrectly, but it seems she is flabbergasted and I'm not sure I follow.  That a bunch of knife manufacturers are pushing to drop the rather idiotic ban on [small] knives isn't even a little surprising, nor is it that the bizarre and insane leader of the NRA would comment on it as he did. 

The fact is that the amount of stupid that is part and parcel to getting on an airplane nowadays is ridiculous.  Pretty much none of it really makes us safer.  Some of it makes some people feel better, but mostly it just causes lines and pisses people off.  The most stupid is the liquids ban, with the rapiscans a close second.

The knife ban is an odd one in that it really doesn't make us safer (crochet needles are potentially deadly, and it isn't as though there aren't stores through security that sell things that could easily be made into stabbing weapons) but at the very least it is a ban on something that is an obvious weapon. Still, I don't see it as a good idea, and I think the tradeoffs are not worth it.

I used to carry a pocket knife with me pretty much everywhere--they can come in quite handy--but now I don't because I'm afraid I will forget about it when I am rushing to a flight and end up losing it.  So this rule has affected not just my airport trips, but my daily life...and there have been plenty of times that I've wished I had my leatherman on hand but didn't.  In the end a law that doesn't make us safer is inconveniencing many, and at least for myself that inconvenience extends to the non-flying times in my life.

I'd rather see the liquids ban eliminated than the knife one, but any peeling back of stupid I see as a good thing. 

Private Public Infrastructrure Boondoggle

I am also mystified by these "banks" but I'm even more perplexed by the entire notion of private investment in infrastructure. 

When the government builds infrastructure that is an investment because that infrastructure will contribute to higher GDP (increased/improved traffic or information tech leads to increased commerce and higher sales/incomes/business revenues) which results in greater tax revenues.  Private industry doesn't tax, however, so for them to build infrastructure as an investment they need to find some other way to extract money.  And because most private industry operates on much shorter time scales than the government, they need to do that fast, which generally means much larger rents than the market would support.

Imagine a road if it is funded by tax revenue then it is "free" to drive on, which means any business that wants to start up there has an advantage in that its employees and customers don't need to pay to get to them.  That is good, and it means that business is more likely to start there.  It may be 5 years before that business turns a profit and pays taxes (though it will likely pay employees which means some payroll/income taxes, but those may just be displaced from elsewhere).

Now imagine that same road funded by a company that wants to profit.  Either they are going to make it a toll road or there will be lots of parking fees, or they will charge any business/resident some fee for access points.  Any of those things will make starting a business (or building houses, or anything) on that road less desirable than the above, and so the build up would be even slower.  Slower buildup means that the company will need to charge more to see any return on its investment and we have a downward spiral.

This is a bad idea in every way imaginable, and yet it is one that is increasingly common as stupid, short sighted, or just rotten politicians try and make a quick buck at the expense of future revenues. 

That's Not Reflective of Bad Management

I guess it's read Matt Yglesias evening.  This post of his is mostly throw-away, but there is something very perplexing in it.  He says:

But laws like this that give local capital an advantage versus remote capital are probably bad for wage earners. What you're essentially doing is creating a protected class of capitalists who are immunized against being put out of business by a more effective owner and manager. That has negative consequences for customers but also for workers—you're essentially stuck working for a less-competent boss in a lower-productivity role than you would be in a more competitive market.

The problem is that that doesn't follow.  It's not every one, but one of the defining aspects of chain establishments is that they treat workers like crap.  Pay minimum wage, grant few benefits, cut back hours...

And that makes good sense.  "Good" managment/ownership is most often perceived as minimizing costs, and one of the easiest ways to do that is to spend as little as possible on workers.  Chain restaurants, whether of a fast food variety or not, get over untrained, low motivation workers by making it so that anyone can do the job.  Some "less-competent" boss may have to hire someone who knows what they are doing to get the same results, and that person will likely be paid more because they have some necessary skill (even if it is just operating a meat slicer, or working a grill).

Marriage makes you less poor?

I understand the numbers and they are real, but something that should be pointed out in MattY's example is that his theoretical couple would likely be better off cohabiting while unmarried. Two impoverished cohabiting "single" parents would likely qualify for more benefits and breaks than one not-impoverished married couple with two children. 

It's not universal, but the way that we treat income with respect to marriage means that it is often better financially for dual income households to not marry than it is to marry (there are other benefits to marriage, mind you).  I think the simplest solution is to drop the entire section of the tax code.  Everyone who files is the same (so no single/married/married filing jointly/head of household crap).  Pick numbers in the middle and leave it at that.

Now that does seem to penalize single income families, but in reality it doesn't: you can have the traditionally working spouse pay the not-traditionally-working spouse half the income, and so split the pie lowering taxes all around...yes, I know that can be complicated, but since my fantasy tax filing would also drop lots of other crap, this would actually be pretty easy.

Libertarians and "Freedom"

They keep using that word.  I do not think it means what they think it means.  (Apologies and respect to Inigo Montoya.)

Libertarians love them some legal marijuana and prostitution (and low taxes, natch), but equality for minorities and immigrants and liberties for women?  That shit don't matter at all.

Rich Moochers

I think this point needs to be made more often and forcefully: a large swath of the wealthy in this country (particularly the anti-tax assholes) are, in reality, our Moocher Class.  Working poor who pay lots of taxes in the form of sales, payroll, state and local contribute a larger share of their income to government than do people like Mitt Romney.

Weird Question

I should certainly watch/listen to what Sarah and Suzie have to say here first, but the very question is weird to put it nicely. Even with the very dramatic change in public opinion on gay marriage, abortion is still more popular (and depending on how the question is phrased, it is much more popular).  On top of that, there are some pretty good reasons why opinion on abortion wouldn't change much over time: while there really isn't any coherent reason to be opposed to gay marriage, there is to abortion (I may disagree with it, but the reasoning is sound).

The better question is that why, with abortion being more popular with the public, are politicians so hesitant to get behind it?  And why, in particular, do nominally pro-choice Democrats keep giving in to the Neanderthal position on the issue? (That is probably not fair, I would guess that Neanderthals would be far more sympathetic to women's authority over their own bodies than are most Republicans.)

Buffett Repeating Himself

The only issue I want to raise with this is where Warren says: "However, I prefer a cutoff point somewhat above $250,000 — maybe $500,000 or so."  There was something in the Fiscal Times furthering this by pointing out that $250k in 1993 is about the same as $400k today. 

Here's the thing: $250k is a crap-load of money.  It is infuriating each and every time anyone (though particularly very rich people) try and argue that it isn't.  The median income in this country is one fifth of that, and well over 90% of families must make do on less than half.  Even very wealthy Manhattan's median income is less than $100k.  People (individuals and families) just don't make nearly as much money as [rich] people think we make, and it makes a huge difference in terms of how we discuss things, like, say retirement.

If we think that lots of families are pulling in $200k/year then it's pretty easy to say that people are irresponsible who don't save enough for retirement, and it's therefore easy to argue that making SS less generous is not that bad: people just need to save a little more.  But families are not pulling in that kind of money.  Most families are living on $66k/year, and after taxes and necessities there isn't a whole lot left over.  If they are forced to save more, then it means a real drop in their standard of living.

Any family getting $250k/year is very well off, at the very least.

This is Going to be Bad

As much as it may be really bad for the large majority of people, some people will be fine and they don't give a shit about the rest of the planet.  If we lived in a decent country, anyone who espoused views that boiled down to: poor elderly should suffer if they weren't as smart/lucky/capable as me would be forced to be poor.

Also, the "10 steps to getting your retirement back on track" slideshow that was on the bottom of that page was full of mostly banal statements/advice that you see everywhere, but I was more than a touch surprised by one: that people should be putting away 30% of gross income each month.  30% is a huge chunk of income...and from gross not net (30% of gross is 38-50% of net).  Most people having trouble saving don't have anywhere near that leftover after regular bills are paid.  Maybe if that figure is meant to include the principle on a mortgage and payments on other debt (paying off credit cards and student loans) people would have some shot at it, but I would have a hell of a hard time doing that, and I've got decent income and am not exactly a spendthrift.

Still about the only people who have a real shot at putting away that much are DINK's with a total income in the near $200k+ range.  Kids and life costs money, and whatever you save has to come out of your excess.  It takes a pretty large income before 30% or more of gross is excess.

Retirement Savings Accounts

I'm not linking to it, but in a discussion regarding whether to pay into a 401k or an IRA one of the comments includes the line:

I have considered investing in both the 401(k) and IRA… but I fear that splitting my money amongst the two retirement accounts will hamper the compounding effect I would realize. Any thoughts?

I am constantly surprised by people who think they know what they are talking about making such obvious mistakes.  Maybe the person is a novice, and trying to figure things out, but why would anyone think that splitting funds would hamper the compounding effects?  The commenter isn't saying that one returns better than another (which does make a difference, but then it would be a return vs. safety question).

If you take 1000 dollars a month and invest it all into an account that pays out 5% you will end up in exactly the same place as if you split it into two different accounts that each pay out 5%. There may be some differences in the accounts due to fees/taxes/other, but if an all inclusive ROI for each account is the same then splitting the money makes exactly 0 difference.  The reason to pick one over another, or to split has to do with limits, company matches and investment opportunities.

Also, as Atrois keeps saying: our current retirement scheme is very broken.  We need to make SS more generous so that our citizens don't have to rely on things like 401k's to survive retirement. That sentence above is evidence that even people who do try, and who think they understand this, are often quite lost.

To add to his reasons, though: if we made SS more generous, then that would provide a huge boost to the economy.  I'm saving far more than I would because a) currently SS doesn't provide much, and b) all the political discussion is around how to make it worse.  Make SS more generous and there are things I would be looking at buying, also I wouldn't be wasting my evenings trying to figure out how much and where to invest for retirement.

Banks are for Suckers

Credit Unions vs. Banks is a lot like Exchange Traded vs. Mutual Funds.  All the advantages/benefits are on one side, yet most of the money is on the other. 

Related: I looked at Vanguard's compare/contrast between ETFs and mutuals...it seems that the "difference" is mostly the name (and which one your plan lets you get).

Finance is weird.  There is no reason for most fees/costs other than scamming/siphoning and other fraud, yet the vast majority of people (really, money) who participate do so via the worse options.  I don't get it.  Why would any sane person keep their paycheck at Chase when some local credit union is going to give them better rates and service?

Money

Voices in the Family (which I generally don't listen to) on NPR was talking about money and our relationship to it.  I only heard a bit but it was is an interesting topic.  I'm a bit of a geek and one of my personal infatuations relating to money has to do with numbers and math. 

I tend to assume there are three basic personality types: spenders, savers, and planners.  The type doesn't relate to whether someone is responsible.  Spenders can stay within their means, while savers can fail to take care of necessary expenses, and planners...well, they plan, which in and of itself is a dangerous activity.

A spender is someone who sees the value of money as being the things they can get for it, often right away.  Maybe they like clothing, maybe it's going out, maybe it is motorcycles or outdoor activities.  Whatever it is, money in the bank doesn't provide it, only money spent does.

A saver sees the value of money in more security terms: something they can keep for a rainy day, but needn't spend much of otherwise.  Savers may or may not be overly frugal.

Planners look a lot like savers at first blush, but they can blow through their entire account and then some once the time is right. 

Most people have a little of everything in them.  We have fun.  We save for a rainy day.  And we plan for large expenses like houses/vacations/cars.  Most people are also, however a bit more drawn to one of these things over the other.  People who fear using their savings account for anything.  People who spend hours or days deliberating a purchase, but then make it very quickly, surprising others.  People who will buy something spur of the moment, and then later scramble to get money in an account or pay a larger than expected credit card bill.

Again, it is possible to be either responsible or irresponsible and to also be any of these three, but it is good to know which of the three someone is before trying to set goals, or plan for them.  A spender will always have a harder time saving than a saver.

True That

I do blame Obama for the sequester, but for the reasons Dean Baker runs through here.  The short of it is that the Obama administration has been an utter failure at understanding and dealing with Republicans. He has given in and given up so much that we are now living in a bizarro US where a president who is about as liberal as Ronald Regan is considered by most to be a liberal, and by many (on the right) to be the most liberal president evah!  

Guns are Irrational

I've been shooting (range, skeet, backyard...that last not a good idea) and it is fun.  I can see why people would want to own a gun, whether for hobby shooting or for hunting.  I can even understand the desire to own several including the mostly ridiculous assault rifle. 

On one level guns are not that different from any item.  Compare to a cookie jar.  No one needs a cookie jar, but having one gives you a place to keep cookies that is a little nicer than the original package or a random piece of tupperware.  So one can be functional, even if not necessary.  But some people may have several cookie jars.  This isn't because people need 2 dozen containers for cookies, but because they are collecting them.  Perhaps he/she appreciates the different styles, or because they have some special meaning (or perhaps the person is a little crazy, but that's ok too). 

At this level guns are not much different.  One can actually be useful: if your hobby is shooting at a range or hunting, then owning one-three guns--rifle, shotgun, maybe 1 range gun (typically handgun)--makes some sense.  Owning more than 1-3 guns is the same as owning more than 1 cookie jar: either you are a collector or insane (if you want to know the difference: collectors have no reason to get angry about things like waiting periods or background checks or magazine size...they could be angry about assault weapons bans, but only if it is a ban on appearance and not function). 

The difference between guns and cookie jars is that one can easily kill a person, accidentally or deliberately.  That is a meaningful difference, and that is why guns become irrational.  Even the most insane cookie jar hoarder is mostly harmless.  A crazy person with lots of killing machines is a threat. 

People who own lots of guns are not people you want to live next door to.  They aren't people you want your children to visit.  If you own a lot of guns: your neighbors don't feel safe, they feel threatened.

If you own even one gun, you have dramatically increased the odds that you or someone in your family will be shot.  This is true even if it is that one useful gun.  Owning a gun makes your household less safe.  Owning guns is irrational.

I Hate Being Sick

Vague flu-like/cold-like symptoms that could be sinus infection or allergy or... and is probably viral, but maybe not (definitely not bacterial).  I get antsy sitting around doing nothing, but if I do/try to do something I feel like crap afterward and for a day or two beyond. 

I have had the flu in the past and have been sick, but it seems like this year has been really bad for reasons I unknown.  Grr...