Friday, April 29, 2011

Wish I'd been there....

Last night in Las Vegas the Rivercats won their game in the top of the 13th.   They started off well with three in the first, one in the second, fifth and seventh and two in the ninth.   And without those two in the ninth the Cats would have been losers.  But then in the longest game so far this year, they had a quick tenth, scored in the eleventh but only to be matched again, had a quick twelfth and then came to the deciding inning.  Anthony Recker opened with his third homer of the year.  Peterson got called out on strikes but then after a Horton double, Heather and Tolleson both ripped off their inaugural homers of the year.   That put us up by four.   The Cats ended up with twenty hits.  That puts us at 12-9.

Thursday, April 28, 2011

Putting the Economics Debate in Rap - Round Two

 Russ Roberts and John Papola have put together another superb video on the differences in two schools of economics (Hayek and Keynes).  This is an entertaining and informative video that everyone should watch.  The project is first rate.

The Apple Tracking Controversy

One wonders what people will worry about next.  Apple's iPhone and other devices like Androids phones and any device that can locate you collect information about where you are.  The iPhone stores that data in a cache on the phone - which if you are clever can be downloaded when you hook the phone to back it up.   The location services option can be encrypted so no person can get the data, if you choose that option.

What does this "conspiracy" offer you?  All sorts of benefits.  It can help you locate friends when they are in your proximity.  It can help you locate services like gas stations and Starbucks and ATMs that are close to you.   From my perspective that feature has been valuable to me.   Apple, and I suspect all of the other phones that do that, are not secretly collecting the data that the phone produces. It also will allow you to find you phone when you have laid it down. So what is the beef - it seems to me like a simple example of over-reaction.   Why can't people just cool it and enjoy all those new services?  Evidently, except for those headline grabbers, based on the sales of these phones, that is what most consumers are doing.

Wednesday, April 27, 2011


We have two friends from Mexico visiting and tonight after dinner took them to the Vernal Pools across from where we live.

It is hard to beat the show of color and wildlife that this area offers - most often a bit earlier in the year.   If we get enough rain- it collects and stays in the hard pan soil and then as it evaporates - ranges of wild flowers appear.  That brings brine shrimp and some tadpoles which a lot of birds find interesting and tasty.

Monday, April 25, 2011

Conventional Wisdom, once again is not

One of the continuing discussions at all levels in public policy has been the assumed decimation of the middle class.  Many commentators on the left and indeed even a couple on the right have suggested that since the early 1980s that the bottom of the economic pyramid has been dealt with cruelly ' the rich have gotten richer and the poor have gotten poorer.

There are some facts that are indisputable.  For example, the value of a high school diploma has declined in real value over the last several decades.   But a study by an economist from the Joint Committee on Taxation and one from Indiana University argues that when you impose some controls on the data that allows you to compare apples to apples - the numbers are not nearly as bad as the wonks with an agenda have suggested.  The numbers are reported in an article that raises some broader questions like which is more efficacious an increase in the minimum wage or expansions of the Earned Income Tax Credit?   Turns out the EITC is a better vehicle (although one could argue there are other consequences of expanding the EITC).

What are those controls?  Well, first, in order to make comparisons across time it would be a good idea to adjust for household size.  At the same time one should also account for changes in fringe benefits and for government transfers.  When you do all that the differentials change a bit.  Everyone is better off.  For example, without the controls the bottom 20% of the income curve suffered a decline of a third in their incomes.  But when you control for the variables they actually received an increase of better than a quarter.   The middle 20% show an increase from a 2.2% to a 36.9% improvement.   Those numbers are pretty dramatic.   The entire article can be accessed at the Journal of Policy Analysis and Management.

Sunday, April 24, 2011

Clarifying thoughts on Taxes

It seems to me that a lot of talk about taxes is just plain silly.   The President's constant harping about raising rates on the rich will be counter-productive in terms of revenue raised.   The GOP claims that we have significant portions of the system not paying any tax is factually wrong.  And the Democrat's constant attempt to make the tax system into an instrument of policy beyond collecting taxes (which the GOP is also guilty of) adds burden and most often does not accomplish the intended purpose.

Here are several things which we know about the current tax system:
1) Increase rates too high and they will decrease the incentive to produce.   For higher income taxpayers (and there is a lot of dispute about who those are) by lowering rates they will pay more taxes.
2) About 45% of Americans pay no federal income taxes.  That does not mean they pay no taxes to the federal government - it just means they pay no income taxes.  It also does not mean that they do not file.  (See chart from Visualizing Economics) In FY 11 - the per capita burden of income taxes was $4554 and the per capita burden of Social Insurance Taxes at the federal level was $3003.
3) As rates have declined the most wealthy in society pay a greater proportion of taxes.  There may be two things at work here.   First, premise #1 may be at work. Higher income taxpayers have a greater ability to choose when they recognize income and if rates are too high, they will choose to defer it. (think capital gains)  But also premise #2 may also be at work.  As you exclude people from the tax system the distribution of tax payments from the remaining groups changes.   From my perspective, it is probably a bit of both.
4) The payments to Social Security (not medicare) are capped for a reason.   Benefits bear little relationship to payments and they are supposed to be a floor not a pension system for all.    For most people the expectation of the system is that they will save for retirement in other ways.

From my perspective there is some wisdom from Adam Smith that many modern taxwriters and talkers should know and do not.   In the Wealth of Nations, Smith wrote that taxes should be timely - "Every tax ought to be levied at the time, or in the manner in which it is most likely to be convenient for the contributor to pay it."   Smith's other three maxims should also be followed - they are "The subject of every State ought to contribute towards the support of the government, as nearly as possible, in proportion to their respective abilities; that is, in proportion to the revenue which they respectively enjoy under the protection of the State."; "The tax each individual is bound to pay ought to be certain, and not arbitrary. The time of payment, the manner of payment, and the quantity to be paid, ought all to be clear and plain to the contributor, and to ever other person."; "Every tax ought to be so contrived as both to take out and to keep out of the pockets of the people as little as possible, over and above what it brings into the public treasury of the State."  (Ability to Pay, Timely and Non-Intrusive)   

Finally, among all the major tax changes done in the last six decades (beginning with the 1954 Act), the best among them was 1986 - which combined simplification with significantly lower rates.   Any discussion of tax "reform" should start with the premises of 1986.

Saturday, April 23, 2011

African Cats

Last night we saw African Cats which is Disney Nature's movie about a group of Cheetahs and two pride of Lions in the African Savanna in Keyna.  Here are six things that I thought about the movie -

1) The photography is unbelievable.   Just the grandeur of the location is impressive.  The production values here compared to earlier Disney nature flicks are seriously better.
2) The movie tended to anthropomorphize the three groups a bit much for my taste.   In order to keep the animals straight they are named.  But the movie goes on to attribute behaviors to levels of thought not instinct.
3)Life on the Savanna is harsh.  During the movie a couple of the main characters disappear.  That is the way it is in the wild.  The cats are hunters so they are shown running down their prey - but always in a tasteful manner.   This movie is fine for small children.
4) It is hard to understand the timeline here.   Clearly the hunters rely a lot on a rainy season and the migration of prey into and out of the region.   But it would have been easier to follow the movie with a better understanding of the time it took for things to happen.
5) Samuel Jackson is a very good narrator but the script was horrible.  It was done in a mawkish fashion which I found off-putting.
6) While I do not object to this, the Disney people are doing a nature movie with a lot of tie-ins -so the website has a lot for sale.  They also give you opportunities to "get involved."  There is a teacher's guide which can be downloaded.  But ultimately what they are doing is selling a movie.  Not bad at all - but not noble either.

Friday, April 22, 2011

Townhall Baloney

The President's  stop  at a "Townhall" at Facebook is on Wednesday was a campaign event staged as news.   I am not sure why it merited any news coverage.   In the one hour and six minute event there was not one spontaneous moment.  These kinds of events seem to be a favorite of many politicians especially this one.  Each of the questions had been screened, in advance.   You can actually imagine the campaign guys reviewing the questions for their campaign value.  From the opening this was a staged event - "My name is Barack Obama, and I'm the guy who got Mark to wear a jacket and tie. (Applause.) Thank you. (Laughter.) I'm very proud of that. (Laughter.) "   (From watching the video it is not clear whether the President's staff used an applause sign or a laugh track."
Here are some comments from the event (with my comments attached)
"The main reason we wanted to do this is, first of all, because more and more people, especially young people, are getting their information through different media. And obviously what all of you have built together is helping to revolutionize how people get information, how they process information, how they're connecting with each other."   But more importantly this has the appearance of a live appearance, without the risks.
The first question from Mark Zuckerberg sets up a narrative that is partially false - How did we get here?   The President replies "What happened then was we went through 10 years where we forgot what had created the surplus in the first place. So we had a massive tax cut that wasn't offset by cuts in spending. We had two wars that weren't paid for. And this was the first time in history where we had gone to war and not asked for additional sacrifice from American citizens. We had a huge prescription drug plan that wasn't paid for. "  The diagram at the left shows the actual Federal debt.  Notice that in the last year of the Bush presidency the debt climbs quickly - but during the first few years of Obama it grows substantially.
The President then goes through a rap about the budget - "What the Republicans right now are saying is, number one, they can't agree to any increases in taxes, which means we'd have to cut out -- of that $4 trillion, all of it would come from education, transportation -- areas that I think are critical for our long-term future."  In the lead up to this part of his response he makes a series of false comparisons that suggest that unless we raise taxes all sorts of key programs will be eliminated.
Zuckerberg then goes on to the housing crisis, which most sane economists argue was caused in large part by government policy (remember that S&P also put Fannie and Freddie on credit watch).  - "What we've really seen is the housing market, which was a bubble, had greatly over-inflated in all regions of the country. And I know I probably don't get a lot of sympathy about that here because I can only imagine what rents and mortgages you guys are paying."  His response is government can help you renegotiate your mortgage bot that we need to think more creatively about whether there should be a federal housing policy.  Here is a great example of that thinking " There are certain communities with high foreclosure rates where what we're trying to do is see if can we help state and local governments take over some of these homes and convert them and provide favorable terms to first-time home buyers."
The key campaign ad speech is contained in a question about Congressman Ryan's proposal on the budget.  "The Republican budget that was put forward I would say is fairly radical. I wouldn't call it particularly courageous. I do think Mr. Ryan is sincere. I think he's a patriot. I think he wants to solve a real problem, which is our long-term deficit. But I think that what he and the other Republicans in the House of Representatives also want to do is change our social compact in a pretty fundamental way. "  He then goes on to argue that by changing the tax system that somehow wealthier people will sneak out of their tax burden. The President will try to misrepresent in fundamental ways what the Ryan plan tries to do.  A linchpin of his argument is on taxes.  The chart at the left compares tax rates and share of the burden paid from the end of the Carter administration.  It clearly shows that as rates are lowered the wealthier pay a higher percentage of the total tax burden.   However, there is one caveat in the data.  In the last 30 years, as a result of tax reform, an increasing percentage of taxpayers bear no income tax burden.  Thus, the percentage of taxes paid by the top bracket would go up some, on the natural.

Thursday, April 21, 2011

A telling 13 seconds

Here is Joanne Kloppenberg, the losing candidate for the Wisconsin Supreme Court taking 13 seconds to answer a simple question about whether she believes she won the race that she has now asked the Government Accountability Board to review.   That self involved request will cost Wisconsin voters about a million dollars.  Her hubris is appalling.    She already used public financing to pay for her campaign (so did her opponent David Prosser) - thus the race has already cost voters $800,000.  Kloppenberg evidently thinks it would be good to double down even though no candidate has overcome a margin of this size before.

Independent expenditures amounted to $135,132 for Kloppenberg or against Prosser.  Prosser's forces spent $12,386.   Thus, outside dough was 12X for the inarticulate Kloppenberg.

The Perils of Mercantilism in Sports Franchises

Yesterday Baseball Commissioner Bud Selig took one of the proudest franchises in Major League Baseball because the current owner, Frank McCourt, has driven it into the dumps.   The LA Dodgers have a distinguished tradition that runs back to Branch Rickey and through the O'Malley family.   In recent years, after the Fox people took it over for a few years, McCourt has run up several hundred million in debts for the club.   (I will admit that I am a Dodger fan so this has been especially troubling.)

The takeover presents several issues - from the mundane, who has financial control of the club; to the more complex - what infractions would allow the commissioner to step in and take over a club?   Dodger attendance is declining and when we went to a Dodger game last Spring - the stadium is showing its age.

Then there is the melodrama of the Sacramento Kings.   Unlike the Dodgers, this franchise has moved around a lot but has been in Sacramento for the past 25 years.  While it had some reasonable teams five or six years ago in recent years the Kings have competed with the Clippers and one or two other franchises as the laughingstock of the NBA.    The current owners, Gavin and Joe Maloof have tried for a couple of years to badger the city or the region into building them a new arena for a couple of hundred million.  When voters said no to tax financing, the Maloofs tried to run away to Anaheim.   Problem is a lot of the Kings fans understand something about contracts and have bedeviled the attempt to sneak away.   In recent weeks, Sacramento's mayor has done some interesting things to keep the Kings here.   A lot of the discussion has been to figure out how much public money would go into the new enterprise.

From my perspective there is very little evidence that sports franchises make a city.  The Bulls or White Sox or Cubs did not make Chicago.  And even with their pathetic record on getting to the World Series, a Cubs game is still a must do on the bucket list.  But somehow even with that data the owners of professional sports, through a combination of civic boosterism and extortion have been able to badger cities into funding their enterprises.  Cities need to "man up" when the owners come to them.

On the other side, if we are going to allow sports franchises to be limited, then there may be a reason to allow oversight of the franchises.   In the case of McCourt, I don't like the idea that Selig has taken the franchise over any more than I do that McCourt has tarnished a franchise which helped to define best practices in professional sports.

Tuesday, April 19, 2011

More Evidence of Government Overreach

A lot of people actually like the FDA food labels that give us nutrition information.   I'm not sure how much it costs to do that - both as a taxpayer and in the increased costs for food producers.   But as I was drinking one of my favorite drinks (MINT WATER) I read the nutrition label.

Mind you that this product has two components - water and mint.  Thus, while it is quite refreshing, it has 0 calories.  (For those of you in Washington, D.C. who were surprised at the S&P credit watch announcement, that means this product has NO CALORIES).

But look at the label - 0 calories, 0 fat, 0 sodium, 0 carbohydrates and 0 protein.  All not unexpected - after all it is water.   But look at the serving size - 8 fl. oz.   Servings per container:2.

There are actually people in Washington who wonder why many Americans have questions about how much we spend out for our federal government.

Saturday, April 16, 2011

Yes he really is that dumb

On March 10 Representative Jesse Jackson Jr said on the House floor - "Let me be clear about a few things," Jackson said, brandishing both an Apple iPad and an Amazon Kindle on the House floor. "These devices are revolutionizing our country — and they will fundamentally alter how we will educate our children."  But on Friday afternoon, he went to the House floor to blame the iPad for killing Borders.  He suggests that the iPad has eliminated "thousands of American jobs."

It is appalling that someone with this little knowledge of economics or technology could actually be employed in a responsible position - oh wait, he is a Member of Congress.  My bad.

The Civil War Today

150 years ago the Civil War was beginning.  The History Channel has developed an iPad APP which is stunningly good called the Civil War Today.   I found it yesterday in the APP store.  It costs $7.99 - which is pricey for an APP but well worth it.

The APP has a series of options to track the Civil War as it evolved beginning in 1861.  Each day begins with a quote of the day and then a reconstructed news story of the major event of the day.  At the same time you can find actual newspapers from the day and photos.  The APP also includes a casualty count and quizzes.

In essence, if you were to follow this through 2015 you would have relived the major and minor events of the Civil War contemporaneously but 150 years later.   This is a superb use of technology.

Friday, April 15, 2011

Atlas Shrugged - The Movie

Atlas Shrugged came out today.  This is a movie that I wanted to see.  As I mentioned earlier in the year, I looked forward to it after seeing The Fountainhead, which was Gary Cooper's attempt to do Rand's other major novel.  The other movie was flawed in a number of ways.  Its 1950s style made it hard to watch.  The version of Atlas Shrugged does not suffer from those problems.

Rand is a hard novelist to bring to the screen.  Her novels are long and have preachy sections. Much of her dialogue is serial soliloquies. But this version (which is the first of three) overcomes those issues well without attacking the substance of the book.   The first third begins by introducing the characters and the desperate situation the country faces.  Government of the time wants to control everything.   There is another problem with bringing this story to the screen.  Its main characters are involved in building a railroad in the future. (2016)   That seems a bit odd.

Each of the actors seem to have been chosen carefully.     They work together individually and as an ensemble.  

I was impressed  most with how closely the movie hews to the novel.   What I do not know is whether someone who has not read the book will get the same value out of it that readers will have.

The reviews of the movie have been interesting.  For some reason, many of them have been brimming with vitriol.  For example, Rolling Stone suggests a tie to the Tea Party.   Film School Rejects calls it "profoundly bad film making."   The Hartford Courant begins with "If you share my embarrassing adolescent affection for Ayn Rand, you may be wondering how a novel about a railroad can be made into a non-costume drama in 2011."  

We saw the movie at a 7:15 showing and the theater was pretty full and the crowd responsive.   I look forward to parts two and three.

An interesting website on civic responsibility

A lefty group called The Third Way has created something called Your Federal Tax Receipt.  It allows you to enter the taxes you paid in 2010 (or will pay) and then computes your share of all the budget categories.   The chart at the right shows some of the calculations for my federal taxes paid this year.  (The red line items are the top ten of the ones I chose.)  Obviously people with a bit more comfort in federal spending would choose different categories and come to different conclusions.

This list is admittedly arbitrary and the classifications at the top are not necessarily fixed.  But it begins to tell me about the priorities that our elected officials have made for our budget in a way that is tangible.  

With this information I can begin to ask some basic questions.  First, are these expenditures worth it?   In many cases, I think they are not.  Last year my taxes spent $15 on CPB and the National Endowments - were I setting the budget, I would save the $15.  Second, it helps understand priorities. I spent almost $5000 on Medicaid (not counting the state matching contributions which are bankrupting many states) was this a good use of my money?   Was it worth it to me to have almost $100 a year spent on the TSA (that does not count all the other fees and taxes I pay to travel by air)?   Could the almost $13,000 I spent on Social Security could have been better utilized?

The most interesting and disturbing numbers that came out of this exercise are ones that are constant.  The first, how much each American is in hock for past and current deficits ($48,382).  The second, how much this total went up from last year ($5,768).

A variation on the Emperors New Clothes

 On Thursday five members of the California legislature called out some LA talk show bullies by holding a fundraiser in Sacramento.   John Kobylt and Ken Champiou are afternoon hosts on KFI in Los Angeles.   They mix arrogance with ignorance in stunning fashion.  

One of the campaigns they have mounted since the beginning of the year has been to suggest that any GOP member of the legislature that votes to put the extension of taxes that were adopted two years ago on the ballot should have his head put on a stake.   That nicely parallels a campaign by ethanol supporter and anti-tax advocate Grover Norquist who has promised primary opponents against any GOP member who supports allowing the people to vote.
Wednesday's fundraiser was unusual on many counts.  First, the five members - who with a couple of others in the GOP caucus have taken their responsibility of legislating serious - pointed out that just because you have 50,000 watts does not mean you have brains.  Second, Governor Brown attended the function.  Brown recently has been quoting Article II, Section 1 of the California Constitution which reserves all political power to the people.

The point here is not whether the extensions of taxes are a good idea or a bad one or whether the voters would accept the extensions of the taxes that were adopted by the legislature two years ago or not.  The point is that the members who stand up to John and Ken are taking their job seriously.  The state's budget deficit has many sources  and the best way to solve those problems is to entertain lots of alternatives.   By discussing those alternatives the GOP might be able to secure a vote on issues like reforming the state's pension system or to establish a long term spending cap.   Both of which would reduce future deficits and at the same time point out the differences between the democrats and republicans on key issues.  

John and Ken's strategy, if you can call it that, would consign the GOP to a permanent minority status. It is refreshing to see five members point out that the shock jocks have no brains.

Thursday, April 14, 2011

No further explanation is required

Las Vegas Top of the 7th - 
  • Pitcher Change: Gabe DeHoyos replaces Guillermo Moscoso.
  • David Cooper flies out to right fielder Adam Heether.
  • Chris Woodward walks.
  • Adam Loewen singles on a line drive to right fielder Adam Heether. Chris Woodward to 3rd.
  • Ryan Shealy singles on a soft line drive to left fielder Steve Tolleson. Chris Woodward scores. Adam Loewen to 2nd.
  • Brian Jeroloman strikes out swinging and Adam Loewen caught stealing 3rd, catcher Josh Donaldson to third baseman Josh Horton.

Las Vegas Top of the 11th
  • Brett Lawrie flies out to left fielder Steve Tolleson.
  • Eric Thames singles on a ground ball to left fielder Steve Tolleson.
  • David Cooper walks. Eric Thames to 2nd.
  • Chris Woodward singles on a line drive to center fielder Matt Carson. Eric Thames out at home on the throw, center fielder Matt Carson to catcher Josh Donaldson. David Cooper to 2nd.
  • Adam Loewen strikes out swinging.

Sacramento Bottom of the 11th
  • Steve Tolleson hit by pitch.
  • Chris Carter flies out to center fielder Darin Mastroianni.
  • Matt Carson singles on a line drive to right fielder Adam Loewen. Steve Tolleson to 3rd.
  • Anthony Recker out on a sacrifice fly to center fielder Darin Mastroianni. Steve Tolleson scores.

Wednesday, April 13, 2011

Opportunity Knocks and we don't answer

The Rivercats are now two for seven.   In the first series with the Tacoma Raniers they split.  In this one with the Las Vegas 51s - the best they could do (by winning tomorrow) would be to go one for four.   But in several games in this young season we have been presented with the possibility to win and we did not capitalize on the opportunity.

In Monday's game we lost 6-3 after being tied in the third.   The 51s then scored in the third, seventh and ninth.   Last night we went down early but then tied back and in the ninth with a series of lousy moves gave up two runs.   In today's game we went down early, tied it back up - had the go ahead run but then let a run score in the ninth and lost 6-5.

That is not to say that we have not had some good plays and some promising new players.  But we have let opportunity slip through our fingers too many times in this young season.  We're fourth from the bottom in hitting (with a .253 average) compared to the league leading Iowa club (.322).  Or batters have looked at a lot of third strikes.  Indeed they have had almost twice as many strikeouts (64) as walks (36).  59 hits have produced just 17 extra bases (2 homers and one very impressive triple).  The club has 62 strikeouts and only 24 walks.

The games have been exceptionally cold.  Let's hope as the weather improves so will our ability to create and seize on opportunities.

Monday, April 11, 2011

John Taylor has a point

A lot of conservatives have groused about the budget deal that was struck at the end of last week to avert a shutdown.  John Taylor calls the deal a "game changer."   Here's why.  The net change between what the Administration proposed and was actually adopted the first (Taylor believes) in a series of downward reductions in federal spending.  There is a real decline in the level of federal discretionary spending from 2010 to 2011.    Obviously, the step is small but the actual direction of spending is down not up.  There are plenty of next steps.  Over the course of the last two administrations federal spending has rocketed ahead.   Now we have an actual decline.  

What comes next is not simply discretionary spending.  A good deal of the $2 trillion increase in spending over the last couple of years came in non-discretionary spending.  One could eliminate entirely the range of discretionary spending and still not solve the deficit - so that change in mentality for both discretionary and non-discretionary spending is critical.

I hope Taylor is correct.  It is not clear, with the President's remarks over the weekend, that all of Washington has gotten the point.  This is not a revenue problem, it is a spending problem.  While it might be great policy to change the tax system in the country, it would not be a good idea to try to increase the pie to cover the deficit.  The President seems to think this is a revenue problem.

The more pessimistic view comes from Michael Ramirez, one of the nation's best political cartoonists.  He drew us a picture of the budget pie which puts the discussions over the last couple of weeks in perspective.

Sunday, April 10, 2011

Out of Touch Presidents

During the first Bush administration, the President went into a market during his vacation and wondered what a price scanner was.   He was roundly criticized for his lack of knowledge of the common man.

Last week, the current president said the following in response to a questions about rising gas prices:

I’m just gonna be honest with ya. There’s not much we can do next week or two weeks from now [about gas prices]. (snickers) If you’re getting eight miles a gallon you may want to think about a trade-in. You can get a great deal. I — I promise you GM, or Ford, they’re — or Chrysler, they’re — gonna be happy to give you a deal on — on something that gets you better gas mileage. Gas prices? They’re gonna still fluctuate until we can start making these broader changes, and that’s gonna take a couple of years to have serious effect.

From my perspective Obama's remarks are both arrogant and out of touch.   Gas prices have risen because of uncertainty in the Middle East, and because of worldwide demand, and because of somewhat restricted supply (caused by countries who do not want to develop their resources).   The President's response seems to ignore that and concentrate on the individual's failings for not immediately buying a new car when gas prices rise.

Saturday, April 09, 2011

Oregon Trail Budgeting

A niece of mine did a Facebook post from a post in Reddit  which says "The US budget is like a 1st grader playing Oregon Trail. Spend all the money on ammunition so you can shoot at stuff, then wonder why your wagon is falling apart and everyone is dying of dysentery."  It is an interesting point but got me to think about what the numbers on the budget actually are.   It turns out the calculation is not as easy as one would think.

There are at least two judgment calls involved.  First, what percentage of all the defense related stuff not in the DOD do you add to the DOD budget.  For example, is there a military purpose for NASA?   Second, what percentage of the national debt is attributable to current and past wars? That translates into debt service which is a part of the budget.  (about 6% now but growing) There the estimates seem to be ideologically driven.  The estimates I have seen range from a low of 15% to a high of 91%.   

Ultimately the conclusion is right.  At this point the budget is a zero sum game.  Add to one portion and you need to take from another, especially if 40% of the budget is debt financed.  (Consider that of that deficit the military portion is about 8% of the budget alone.)  But in this case the ultimate question just like in Oregon Trail - how do we set priorities.

The Budget Deal

There is a lot of grousing on the budget deal that stopped the shutdown, on both sides.   But here are my takes.

#1 - The budget deal for this year was not as large as it should have been but it was way better than it could have been.   The real issue comes with the next budget.
#2 - The problem is not revenues, it is expenses.  When you have 40% of your budget coming from borrowed money this is not a revenue problem.
#3 - A good deal of what was called the Great Society is a major contributor to the problem.  There is an assumption that by making something funded with public funds somehow it will be better or available to more or some other unproven concept.  During the Great Society era RFK was quoted as saying "Some people see things as they are and ask why?   I dream of things that never were and ask, Why Not?" (Actually that is a quote from GB Shaw)  The problem with the assumption is that it assumes that the unknown will always trump the known.  We've now got 40 years of data that suggests that there are some immutable parts of human nature that are not likely to be changed.   Government art is not better and may be worse.  Ditto for support for the Humanities.  Ditto for Public Media.   We need to think carefully about what government can do well not what government can do.
#4 - Just because the government does it does not mean it will be unchangeable.  Entitlements need to be on the table and need to go to less centrally controlled systems.
#5 - The Ryan Plan for next year is a good starting point.  We need to reintroduce a strong component of opportunities for individual initiative.  Nannystateism is a failure.   But so is Mercantilism.  Unfortunately the current administration seems to believe in both with policies like Obamacare and support for GE and Green Tech.  The market is a pretty good way to encourage initiative.

Friday, April 08, 2011

A classic election night statement

On Tuesday night candidate JoAnne Kloppenberg offered a good example of a premature announcement.  Her news conference is remarkable.  At this point she had a "lead" of 204 votes.

Last night the results changed a bit with David Prosser jumping into a 7500 vote margin.  Let's see what the final canvas results in but at this point Ms. Kloppenberg looks pretty silly.  According to the news reports, if the current margin holds up there will be no need for an automatic recount.

Steve Hughes from the group Move.on also seems to have misfired.  In a note he gushed "We just had a HUGE win!!  I'm literally breathless.  I'm witnessing history.   Incumbent candidates for the Wisconsin Supreme Court generally get re-elected in a landslide.   But in the general election yesterday, progressive JoAnne Kloppenberg closed the gap and, with 100% of the precincts reporting, has beating (sic) conservative justice David Prosser!  I wonder if Mr. Hughes is still "breathless."   I bet he is.

On Friday morning Melissa Mulilken who was Kloppenberg's campaign manager announced this morning that they would begin raising money for a recount. Reminder that Prosser now leads by a bit more than 7000 votes out of 1.5 million cast.  Ms. Mulilken was not clear about whether the money raised would be actually used to do the recount or to simply reimburse the unions who poured tons of bucks to try to by the race.

Horn Tooting

The Pew Research Center has a periodic quiz on the news and the current one has eleven questions.  You can see my score to the right (11:11).

The questions are pretty basic and they are multiple choice.   There are some which might be tricky -one of the four choices on a question about "No child left behind" is whether the law is a policy on transportation.  But you should wonder about people who do not know that Moammar Gadhafi is the leader of Libya (other choices included Egypt, China or Saudi Arabia).  Other questions included what does Hillary Clinton do and what is the fight in Wisconsin about?

I guess the good thing about this poll is that more than 50% of the responses got more than half the questions correct.

Rivercats Opener

The news reports described the night as brisk.  From my perspective that is not accurate.  It was cold.  But the Cats opener was fun none-the-less.  The crowd started at about 10,500 but dwindled as the night became increasingly cold.  By the time we left at the end of the sixth it was 44 degrees with a wind chill that made it a lot colder.

The best play of the night was Jemile Weeks three run triple - stretched into an extra run by an error in the bottom of the second.  We got a taste of how Darren Bush, our new manager, might manage third base.   One of the criticisms of Tony DiFrancesco was that he slowed traffic on third.   Bush seems to want to get them in if he can.

The Cats had 13 hits - Donaldson was the only player not to reach base (Timmons got two walks).   Of that there were four doubles, Weeks triple and Carson's homer in the third.  The pitching staff looked pretty good - our starter Outman had 47 strikes for about 90 pitches, his successor and the winner of the game (Chulk) threw 20 of 29.   For a four innings the Raniers were unable to reach base.

In the twelve opening nights we've had, the Cats have won eight of them but several have had uncertain weather - several have had rain including the first game in Raley Field.    The Cats have three more home games with the Raniers then four more with the Las Vegas 51s and then start their first road trip.

Wednesday, April 06, 2011

Basic Sales Comparisons

The iPad 2 seems to have sold between 2.4 and 2.6 million units during March.  In comparison, the Motorola Zoom, according to Morgan Stanley seems to have done 100,000 units.  In case you have not seen one, and it is unlikely, here is a photo of the 7" Android wonder. (to give you an idea of the popularity of the Zoom - the JPG I found on the net is called "unknown.jpg")

Off their meds...

At the beginning of the week Congressman Ryan proposed to reduce the federal budget roughly back to the levels of 2008.   That does not bring the budget back to reasonable levels, at least by most calculations.  But to give you an idea about the state of the discussion, one need only listen to the H&R Block's last minute ads for their tax services.  Evidently, the tax firm will get you "everything you are entitled to" - Doesn't that logic bother you?  It does me.   The only way it would make sense is to assume that wealth is created by the government.  That is nonsense. Evidently a lot of Americans buy that crap.  Wealth is not created by government policy but it sure is inhibited by it.   For the last several years (not the last two) we have had a growing Leviathan in the best sense of Hobbes.  We need to have a serious discussion and then some serious moves to reduce the spending binge.

Government spending has exploded.  Debt has grown at monster proportions.   But some of the Washington cognizanti have the notion imbedded that it is their dough and we peons better not take any of it back - no matter how horribly they have screwed it up.

On Wednesday, Isabell Sawhill, former Urban Institute staffer and now at Brookings came unhinged in an article in the lefty emag called Democracy Journal when she screamed Ryan's proposal is "an ideological manifesto for a Tea-Party-dominated Republican Party."  When you cannot argue substance you argue slogans.  

Any competent economist understands that in the current situation that additional government spending is actually a drag on economic growth.    Yet, Sawhill is incredulous that reducing federal spending would actually increase economic growth.   We ballooned federal spending for the last few years and growth did not jump ahead.  Some reduction in unemployment but huge increases in underemployment.  Accelerating inflation that everyone but the Wonks in DC seem to think is a problem of not whether but when.   But Sawhill's prescription would be to continue on the path.

We've really got a choice.  We could continue to listen to the panderers for more spending like Sawhill and then just sit back and watch the American economy be destroyed.  Or we can begin to think about how to get out of this mess.  From my perspective that is not much of a choice.  Perhaps we should simply let the government shut down and see if we miss it.

Tuesday, April 05, 2011


Tonight's scrimmage against the Stockton Ports had a series of mixed responses.  The game was lackluster.  The Cats looked clumsy and witless.  It was a bit cold tonight and hope that it is not raining for the opener.  But here are six impressions:

#1 - The Crowd - the scrimmage was free and the crowd was small.  Season ticket holders got a voucher to try out some of the new foods.  Even with that incentive the crowd was probably less than 1000.
#2 - The Food - They have introduced a number of new foods including a black bean burger - very tasty; and a Walking Taco (a taco in a waffle cone - tasty but messy) and a Donut Dog (Hot dog on a donut).
#3 - The Players - There are a bunch of last year's team back again.  One friend who went to Spring Training said we should have a good group of pitchers - from tonight's outing I sure did not see that.
#4 - Cat's Cash - this year on a credit card - great innovation.
#5 - The Season - Opens on Thursday against Tacoma.
#6 - The new crew (the kids who pump up the stands) - seems to be a pretty good group.

One more comment not on the game.  The early days in the season will be a challenge.  They are revamping the roads past Tower Bridge and that makes for a traffic mess from the North side of the stadium.  Parking in the first four games is free but it is still a hassle to get in and out.

Monday, April 04, 2011

Follow up on 10" Envy post

This is from Apple InsiderThe success of Apple's iPad has had a major impact on the netbook market, forcing the CEO of low-cost notebook maker Acer to resign. That follows the departures of top brass from two other Apple competitors, Nokia and LG.

The meaning of the term novelist

I've always disliked Steinbeck's The Grapes of Wrath.  When you understand how it was written it is understandable.  But from my perspective, the novel is about as horrible as the trash that went to literature with the muckrakers - for example like McTeague (Frank Norris' unrelenting tale of the horror of late 19th century industrial society).

The Grapes of Wrath was written as a prequil to a movie of the same name (which is also pretty dreadful).   It tells the story of a family called the Joads that experiences a continuous process of decline starting in the dustbowl and then moving to California to pick crops.   I first read the book in high school and even then thought it was a caricature of the real issues faced by people who were part of one of America's most interesting migrations.  Times were tough.  But there are much better pictures of that time in our history.    

In the April 2011 edition of Reason, the libertarian magazine, Bill Steigerwald makes a good case that one of Steinbeck's other novels, Travels with Charley, which was written in the early 1960s  and supposedly a diary of a trip he took late in life to see America by car (or trailer) with his dog Charley.   Almost immediately some Steinbeck scholars wrote defense of the book - after all it is by a novelist.  Bill Barich, a novelist who now lives in Ireland (lucky stiff!) takes a fairly balanced view of the book.  He suggests that there are a lot of reasons why Steinbeck would have used the literary device of making some of his "travels" up.   The viability of any of these kinds of inventions is whether they weather well. From my point of view The Grapes of Wrath, which I re-read about four years ago, does not meet the test.   Not sure I have the energy to retest with travels with Charley - but I sure do with Barich's book - written in 2008 Long Way Home: On the Trail of Steinbeck's America in where he took a 5400 mile trip to retrace Steinbeck's original (somewhat fanciful) journey.