Earn 45% — Fully Secured November 30, 2001February 20, 2017 Have you gotten this one? I assume they send it to millions of people with a single click, and what interests me is not the 45% you earn, fully secured – quarterly, no less – but that someplace there is a seedy, sad world you and I have no real contact with (I hope) in which some small number of people send out these deceptive e-mails at 3:37 in the morning, and some larger number of people, apparently, wake up a few hours later to the great news and get sucked in (or else why would it pay even to make that one click?). Here was the e-mail: Tired of taking a roller coaster ride. Date: 11/29/01 3:37:07 AM Eastern Standard Time From: nchandra@lettucefly.com To: gemenip@aol.com MAKE 45% QUARTERLY Learn how you can make 45% paid quarterly in advance factoring commercial accounts receivables. Discover what factors (Corporate Money Lenders) have been doing successfully for decades, lending money to businesses. Harness the power and liquidity of fully secured account receivables (receivables are titled with UCC-1 Filings) Contact us for your “FREE” in-depth information package. Look into how you can get a return of 45% paid quarterly in advance and “Fully secured”. It is true there is a class of lender called a ‘factor.’ It is true that ‘factors’ lend against the value of a company’s accounts receivable. Well, not lend, exactly – they buy accounts receivable at a discount. (Say you make orange juice squeezers and sell them to distributors who normally take 60 or 90 days to pay you. Those unpaid bills you’re waiting to have paid are your ‘accounts receivable.’ And if you’re desperate for cash and can’t wait the 60 or 90 days, a factor might agree to buy them and pay you immediately, in return for title to those accounts receivable. Only he wouldn’t pay you 100 cents on the dollar; he’d deduct a chunk for his trouble, his risk, and a return on his money.) I don’t know much about this business. All I know is that the e-mail would appear to say that you can earn 45% per quarter in something fully secure. And to suggest that there are people who have been doing so . . . for decades! At 45% per quarter, if you started with just one penny – doubtless hard to do, but for the sake of argument – and if you let your 45% return ride for two and a half decades, you would have $137 trillion. Not only would you be the wealthiest man or woman in the world, after just 25 years, starting with just a penny (the same penny you almost didn’t even bother to pick up off the sidewalk!), you would have more or less ALL the wealth in the world. Assuming, that is, you made this investment under the umbrella of a tax-sheltered retirement plan. I will grant (reluctantly) that upon closer reading, the e-mail might more accurately be interpreted to promise 45% annually (but paid in quarterly installments). But even that is preposterous. It could certainly happen in some year. Ask any loan shark. But how many billionaire loan sharks – or factors – do you know? Start out with $50,000 (which would still not make you much of a factor), and after three decades at 45% you’d have $3.5 billion. What’s the catch? The catch is, I don’t have the nerve even to find out what the catch is, because I wouldn’t feel comfortable giving out the personal information required to get the promised FREE in-depth information package. But wouldn’t it be interesting – if a little depressing – to see all this come to life on ‘Dateline’ or ’60 Minutes?’ Interviews with the folks who wrote and sent the e-mail; interviews with folks who got the e-mail and sent in for the FREE in-depth information package; and then some sort of denouement, as we learn how well or poorly those folks ultimately did?
Smoking Potpouri November 29, 2001January 25, 2017 ‘Lung Cancer to Change Its Name to Philip Morris’ — recent headline from SatireWire SPEAK OF THE DEVIL . . . Dave Kline: ‘My daughter has a calico cat. It climbs all over her apartment and has now three times jumped on her computer keyboard, its paw striking only the ‘6’ key and repeatedly typing 66666666. Hmm….’ AND YOU THOUGHT CHRISTMAS TREES WERE DANGEROUS Trisha: ‘Just a note of caution … Be very careful with the toaster oven. I am not sure where I remember this from, but I believe that toaster ovens are one of the most dangerous household appliances regarding accidental fires. I recently got a chance to use a fire extinguisher, and saw a demo of people trying to put out a fire. Most people, me included, even though I was aware of the problem, aim at the wrong place — too high … so if you love your toaster oven, I recommend not a fire extinguisher, but keeping a fire blanket at hand for dealing with any black smoke issues. Oh yes, and a nice safe means of unplugging the unit from its source of electricity. In the demo, you wouldn’t believe how many people tried to put out the fire without remembering to turn the appliance/heat source off.’ BUT CAN I SELL MY TOASTER OVEN THIS WAY? Michael White: ‘Do you know that we can now sell our used books, CDs & DVDs on Amazon’s website? It has to be something that they sell new. You have to give them your bank account # (payment is wired to your bank), credit card # and phone #, but you wind up with more money than you would ever get otherwise (college students take note). You have to promise to mail the item within 2 business days of being notified by Amazon that your item is sold. The e-mail that Amazon sends includes a bill of lading and a shipping label.’ IF THE CIGARETTES OR THE TOASTER OVEN KILL YOU Joe Devney: ‘One important point is often missed by people who claim that the ‘confiscatory’ estate tax in some ways punishes hard work and ambition: the tax doesn’t take anything from the person who earned his own fortune, because he is already dead. The people affected are those who ‘earned’ the money only by choosing their parents carefully. One lesson I took from The Millionaire Next Door is that being overly generous to your children can rob them of ambition. In order to illustrate a point that their broader research had borne out, the authors told the story of one couple and their grown daughter. The parents were anxious that the daughter be successful in life without struggling as they had done, and so paved the way for her. They gave the daughter an annual stipend of $50,000 and set her up in her own business. Since she was taking no risks on her own, the daughter paid little attention to the business; her greatest achievement was spending $20,000 a year on clothes.’ ☞ Of course, the decision of how much or little to leave to your daughter is yours alone to make. ‘But [Joe continues] to say that the estate tax penalizes good American capitalist values like inventiveness and ambition is wrong. Shrinking the size of a million-dollar inheritance may even encourage ambition in the new generation.’
Going Up? November 28, 2001February 20, 2017 Day trading R not us. Or not me, anyway. I like to sink my teeth into some wacky, bedraggled homeless little stock no self-respecting pension fund manager would dream of touching and hold on to the bitter end, like a pit-bull, through the throes of bankruptcy, humiliation and, ultimately, that letter your broker sometimes sends telling you your security has become ‘worthless’ – pft. This is not, needless to say, what you should do. You should buy index funds and I-Bonds. But I persevere, in part to amuse you (an obligation I take seriously, my political screeds notwithstanding) and in part because once in a while – not often – these things actually work out. Look how nicely we did on Calton Homes, first written up here on August 13, 1998 – a five-fold profit in little more than a year. (Long time readers will know there were some twists, turns, $5-a-share distributions, and a reverse-split along the way. And that currently, just a tiny stub remains that really may go to zero. But I hold onto that stub, too, having come this far. A wipeout on this last little piece would barely dent our earlier good fortune.) Wackiest of all has been Borealis.com, first written up here in November, 1999 (A Stock That’s Surely Going to Zero), and then again in March, August, and November of last year, and, most recently, this past May, when it issued a press release, with the apparent acquiescence of Boeing, that suggested that maybe, conceivably, there was actually something here worth looking at. (Because if the company’s claims prove true – all in plain view on its web site – then it is presumably worth not $25 million, which is how the market values it today . . . about 5 million shares at about $5 each . . . but perhaps billions. And I needn’t tell the math whizzes in the crowd what that would ultimately do to the stock.) So now comes another press release (Boeing, for its part, thus far remains mum), this time from a Canadian company called Beckett Elevator Ltd., that makes . . . well, elevators: GIBRALTAR–(BUSINESS WIRE)–Nov. 27, 2001–Chorus Motors plc, a subsidiary of Borealis Exploration Limited (BOREF), has entered into a licensing agreement with Beckett Elevator International Limited, also of Gibraltar. Under the agreement, Beckett obtains an exclusive worldwide license for the use of Chorus(TM) technology in the elevator market, and will design a radically new hoist motor for the global elevator market jointly with Chorus Motors plc. Dermot E. Camack, president of Beckett Elevator, says “Beckett’s mission to meet and exceed the exacting requirements of today’s elevator marketplace will be well served by adopting this new technology. We are confident that elevators using the Chorus(TM)/Beckett Technology will increase the reliability of tomorrow’s elevators.” Chorus Motors president Isaiah W. Cox says “We are delighted to be working with Beckett and Dermot E. Camack. Beckett is an old and trusted name in the elevator business and our respective skills should enable us to take a commanding share of the worldwide elevator market.” Characteristics of the Chorus(TM) Motor include very high start-up torque and greater efficiency, within standard operating temperature limits. Tests have shown marked improvements over conventional AC motors. See the Chorus Motors plc web site at www.chorusmotors.gi for more information. Beckett Elevator Limited, an associated company, is one of the most successful elevator manufacturers in Canada. Founded in 1953, it maintains the highest standard for quality with modern equipment and advanced technology. Since 1986, Beckett Elevator Limited has concentrated on supplying both partial and complete systems to the elevator industry and continues to invest a large portion of its operating budget in research and development to maintain its strong position in the marketplace. Borealis Exploration Limited (BOREF) is a research and development company founded in 1968 and based in Gibraltar in the European Union. It has 4.942,197 shares outstanding. Borealis’ business is reinventing the core technologies used by basic industries, including electric motors, steelmaking, electrical power generation, cooling and refrigeration. What’s gotten into these companies, Boeing and Beckett, that they would even get to the press release stage with Borealis? Could it be a ‘B’ thing? Is BMW next? Belgium? I am counting no chickens. The stock was about $3.50 a share two years ago and, at $5 or so today, remains essentially unchanged, as does the prognosis: it will either be zero, eventually, for the reasons set forth in earlier columns (or other reasons I haven’t thought of) or, one would imagine, it will be valued at many times its current $25 million. (There are paintings that sell for more than $25 million.) And what a nice bonus if, in addition to business success, it actually manages to make the world more energy efficient, as suggested by the claims on its web site? As before: if you do dabble in this preposterous speculation, promise me you will invest only money you can truly, truly afford to lose. Because you probably will.
Calico Cats – II November 27, 2001January 25, 2017 John Farr: ‘I write a weekly column for Applelinks.com called GRACK! and in the current edition I quoted from your recent column about the Attorney General and calico cats. In response I received the following email: << Any sense of journalistic integrity dictates that when making a claim such as this, you must cite some sort of credible reference [like Time or Newsweek or the New York Times]. A random website currently does not constitute such a reference. >> ‘I thought I would ask you where you learned the details about the calico cats and their significance to our current attorney general.’ ☞ A very fair question. I’ve written for a variety of magazines over the last 30 years, including a column in TIME for several years, and have some appreciation of the need not to publish allegations as true unless I’ve checked them out. I got this odd story from someone who was definitely in a position to know and then confirmed it with someone else, also in a position to know. That said, it’s certainly possible that Ashcroft doesn’t actually believe calico cats are signs of the devil, even though his aides said he does. And it’s possible that his aides were kidding, or overly sensitive, when they discussed covering the naked statue. Then again, the Attorney General does not hide his deep religious faith – one need only read his remarks at Bob Jones University to get some appreciation of that – and a lot of deeply religious people do believe in a heaven and a hell and the devil. So it may not be as odd as the story of Nancy Reagan consulting her astrologer before letting Ronnie make important decisions. Who knows? Clearly, what matters are not any superstitions John Ashcroft may harbor, but the various initiatives coming out of his office. As I read and listen to wiser minds than mine about the military tribunals and related curtailments of civil liberties – noting the criticism that has come from conservatives and liberals alike – I get the distinct impression he’s gone too far. And, as I wrote last week, I deeply resent his taking time out from the war on terrorism to try to overturn California’s medical marijuana referendum and Oregon’s twice-passed assisted suicide referendum. It’s fine for him to choose to suffer, but I don’t want him choosing that for me. Separately, for those who have time to read it, I thought this story in Saturday’s Washington Post brought home some of the vague allegations of ‘discrimination’ we hear about with a concrete example from the 9/11 tragedy. A billion dollars has poured in to help the loved ones of the victims – unless you are a particular kind of loved one. (Happily, even here progress if being made).
Let the Private Sector Do It November 26, 2001February 20, 2017 Believe me, I am a fan of the free market. And of private enterprise. And of private charity. But the notion that no balance is required here – that the private sector can do it all and that, when it comes to taxes and government, less is always better – well, I just don’t buy it. No one likes taxes, but they are a relatively efficient way to collect money for things most of us agree are necessary – police forces, fire departments, public school systems, roads, the armed forces, and some mechanism to help the truly needed from dying in our streets. Charities have a much warmer place in our hearts, but the first 30 cents of every dollar you give goes to the hotel and the caterer and the florist and sending out the invitations; or to the printing and postage; or to the company that employs the folks who call you at home in the middle of dinner. And it’s not clear that the remaining 70 cents (or whatever the number, depending on the charity) is always brilliantly allocated, either. Is charity worth supporting – being ever vigilant in hopes of making it ever more effective? Yes! Is government? Yes, too. Matthew Miller’s latest column makes this point awfully well. He writes: Among the many useful tonics bequeathed by Sept. 11 is the exposure of the hoax that the most effective way to render aid is always charity, not government. Now – surprise! – it turns out that charity involves bureaucracy and politics, too. The gyrations at the Red Cross are exhibit A. First that organization staged the most confidence-busting executive change in memory when it tossed out CEO Bernadine Healy at a teary press conference at which neither the board doing the firing nor the woman getting the boot could veil their contempt for each other. Then came the revelation that the Red Cross, in a bait and switch that has apparently been its standard operating procedure after high-profile disasters, planned to hold back a big chunk of the record sums raised since Sept. 11 for ‘future needs’ unrelated to the 9/11 victims. (The organization has now done an about-face.) But the Red Cross woes are only the beginning. Already the patchwork of funds set up to cope with the tragedy are awash in thorny questions. Should victims who’ve gotten help from charities have their help from other charities and government reduced by that amount? This seems only fair, but how should this be tracked and coordinated? Are some victims trying to double- and even triple-dip? And why should the 9/11 victims get so much more than the victims of, say, the Oklahoma City bombing, not to mention countless other smaller but still awful tragedies? Conservative commentators (like the Wall Street Journal editorial page) say this all proves that modern bureaucratic culture has ruined charity by making it as complicated and rule-bound as government. ‘Can’t we just give cash to the people who need it?’ they cry. The truth, however, is that once you move past the level of soup kitchens and start dealing with mass tragedies and resources, these issues are perfectly predictable – and show instead the bankruptcy of the conservative strategy to discredit government and install charity in its place. This notion has been a staple of the right’s rhetoric for years, from Newt Gingrich’s call to replace welfare spending with individually earmarked charity tax credits, to George W. Bush’s plan to have faith-based charities play a bigger role in helping the poor. Now let’s be clear: Spiritual organizations do great work in helping people turn around their lives, and government should help these groups do more. But the larger conservative project served by this rhetoric was to de-legitimize (and defund) government while protecting against charges that conservatives lacked compassion. It was a great gig while it lasted. When Gingrich asked, ‘Who would you rather give your money to, Mother Teresa or Donna Shalala?’ there wasn’t any doubt about who’d win that bake-off. But once you got past the sound bite, the logic was always dubious. For one thing, charity remains tiny compared with the size of modern misfortune. Charity has raised $1 billion or so since the attacks. That’s fabulous. But President Bush has already called for $40 billion to deal with the fallout, and more is on the way. So charity, while well-meaning, only tinkers at the margin. What’s more, private compassion is fickle and selective – a fact of life that Adam Smith, that conservative patron saint, recognized long ago. In a famous passage, Smith wrote that a man in Europe would not be able to sleep if he knew he was to lose his little finger tomorrow, but would snore soundly after learning of an earthquake that killed a hundred million Chinese – because the latter were so far from his field of vision, and pity. Such are the perils of reliance on private compassion – as they are learning at all the non-9/11 charities, where donations have dried up in the wake of the attacks. What we need are public institutions imbued with what the philosopher Martha Nussbaum calls ‘a properly educated compassion,’ which offsets our inevitable blind spots as individuals while honoring our deepest values. When we design such institutions well, it’s not some alien force that is doing our bidding, but ourselves – because in a democracy, government, like charity, is us. Only better. In the meantime, if calls to privatize America’s safety net have vanished with the twin towers, then some good will already be coming from this evil. Matt Miller is a senior fellow at Occidental College in Los Angeles. His column is distributed by Tribune Media Services. © 2001 MATTHEW MILLER
Conservatives Who Part Ways with Ashcroft On This One November 21, 2001February 20, 2017 But first, a few of your thoughts on yesterday’s column: Rodger King: ‘Shrill! What happened to your fairness, your humor? Lighten up.’ Don Rintala: ‘Often I disagree with your political opinions, but this time I’d like to march with you. Let’s look at prostate cancer — a very ‘popular’ disease. It metastasizes to the bones, and eventually the spine collapses. This entails both paralysis and excruciating pain. Once it becomes clear that your case is terminal, what’s the point of passing your days in a state of paralysis and extreme pain, while paying colossal medical fees? Many would opt for assisted suicide in such a situation. ‘The Constitution enumerates the powers of Congress, and 10th Amendment states that all other powers lie with the states or the people. Nothing in the Constitution gives the feds power over what drugs we can take, or how doctors can deal with their patients. By rights, Oregon’s assisted suicide law should trump any federal attempt to nullify it. There is, actually, a court case being brought by the state of Oregon to reassert their rights. Let’s hope they win.’ David: ‘I’m surprised to hear you argue that the government is meddling in your business. The government’s purpose – ever since FDR – has been to meddle in people’s business (for the people’s own benefit, of course). Whether it’s Republicans telling you what you can or can’t do in your home (for your own benefit), or the Democrats telling you that they need to take lots of your property away from you (to spend on things that are for your own benefit) – these are two sides of the same coin. It’s just that you complain about one side, conservatives the other. You obviously enjoy politics as a sport. Some people love to debate political issues. There is another way, apart from conservative or liberal. It’s a view that says the individual is more important than society, that people should live for themselves, not for the love of the collective.’ ☞ But there are 6 billion of us on the planet, David. Doesn’t that call for a little organization? And isn’t democracy the least bad way to attain that organization? And within a democracy, isn’t there room for people to agree (even if for largely selfish reasons) that a just, compassionate, prosperous society is worth trying to attain – even as we may disagree about the specifics? And wouldn’t such a society offer public education and health care to children? And perhaps build public roads or have a central bank? Maybe a public police force and fire department – and perhaps even zoning? And before you know it, you’ve got a lot of interesting opportunities to debate, as people differ about how far to go and in what directions. And those debates are healthy, if you ask me, and worth engaging in. One more from you before we get to the main event: Rob Schoen: ‘No comment on today’s column. You have every right to select as insipid a topic as you choose. But then I’m a dog person. Now, if I may be so bold as to suggest a financial topic. Thousands upon thousands of people are worried about black cats – no wait, that’s John Ashcroft – I meant to say are lining up to refinance their home mortgages. What’s your wisdom on this topic? Given that lots of interest $$$ are to be saved in the process, when should folks be doing this? Do you have anything to add to the conventional wisdom?’ ☞ Not really. The decision is fairly straightforward. You weigh the annual savings against the upfront costs. Then decide: Is it worth your time and effort? What you don’t know for sure is how long you’re going to keep the loan. If you think you won’t be moving for a long time, it’s easier to justify the upfront costs. Bear in mind that the interest you save by refinancing is tax-deductible (if you itemize), so the saving may be less than it appears. Sure, you’re saving $2,000 a year in interest, say; but you’re also losing a $2,000 tax-deduction. So maybe, after tax, you’re only saving $1,400 a year. Meanwhile the upfront costs of refinancing a home mortgage are not deductible, they are 100% real – except for any ‘points’ you pay (each point equals 1% of the loan). And even points, on a refinancing, are not be immediately deductible they way they are with an initial mortgage. Instead, you have to write them off over the life of the loan ($100 a year over 30 years if you’re paying $3,000 in points on a 30-year mortgage). Only when you pay off the mortgage early can you take what remains of the undeducted points in a lump as a tax deduction. The mortgage field is highly competitive. Shop around. And now, finally, two famous conservatives addressing yesterday’s topic: First, here is William F. Buckley’s take. You will have to decide for yourself exactly where he comes out on the issue. But I read his column as being unsupportive of Ashcroft, even though Buckley, too, is both conservative and seriously religious. And here is my friend David Brudnoy, the conservative Boston radio talk show host, seven years ‘born again’ – not in the religious sense (far from it), but in the sense that it was seven years ago that he was given two hours to live. He is writing here privately to another prominent conservative, but has granted me permission to reprint this excerpt: I have, as you know, long since made a commitment to myself to do anything that I can do to continue to live, and I have become, in my doctors’ view, and they say this repeatedly, their best patient: I do exactly as told, I do nothing to harm myself, everything to help. All the drugs, all the rest, the absence of smoking my beloved pipes, practically no coffee, the frequent naps, the eating even when I have little appetite, as happens, etc. This is a very fair trade-off for seven years now of continued existence in a pretty decent shape, as you’ve seen yourself. And another commitment to myself: that when and if life should no longer be a joy to live, even with all the impediments – the neuropathy, the lypodystrophy (the misallocation of fat in certain parts of my body and the hollowness of cheeks and thinness of arms and legs), the fatigue, the damn zillions of pills (my doctor the other day went on the computer and concluded that I had taken 156,483 pills in the seven years since I “died”) – I will definitely think about getting out of this mortal coil, by my own hand if necessary. Will Rev. Dr. Bishop Rabbi Mullah Ashcroft be there to arrest me if I need marijuana to keep food down, lest I waste away to nothing? Could that man please just save us from terrorists and stop trying to inflict his personal views on us all? Will I have to be howling in unendurable pain – as at Spaulding Rehabilitation Hospital I was, several times a day for several days, such that I thought for the very first time in my life about suicide, though assured by the doctor and the nurses, truthfully as it turned out, that that part of it all would pass – with no relief in sight, while he and his goons sweep into my doctor’s office to prohibit him from prescribing morphine if I need it? I hope others on our side of the aisle will begin to give this some thought, as many have come out for stem cell research when realizing, as Sen. Hatch and Nancy Reagan and some others have done, what it might mean to people like their beloveds. It is awful that it takes a personal thing – your sister, my AIDS, Reagan’s Alzheimer’s – to get you, me, Nancy, to see things more clearly. But there it is. I am not going to wish that sort of thing on anybody, Ashcroft included, but the temptation is there, hovering, while wondering if anything but a personal epiphany arising out of his own or his wife’s or children’s misery will get that wretched man to see the light. I say to the AG: you endure unrelenting, hideous pain all you want, you waste away to nothing because you can’t keep your food down owing to chemotherapy, you go to meet your Maker in absolutely unbearable excruciating horror if you like – but please don’t demand that I join you in that approach to the situation. How, I wonder, can a person who sees himself as a devout and religious man be so vicious, and, moreover, so blind to the needs of others? What creates people like John Ashcroft? Where does Bible-thumping go so dreadfully wrong? Is the Left really so completely out of the bounds of reason when they see that type of American “religious” person as sharing more than just a wee bit of mentality with the Wahabists? We’re barely into week nine of what will likely be a decade or more of struggle to preserve our freedoms from the tyranny wished upon us by religious crackpot Muslim reactionary zealots, and our attorney general takes time out of that to try to crack down on medical marijuana and physicians giving some comfort near the end to people in miserable pain. What kind of a man is this man? You know him personally. Is there just no empathetic cartilage anywhere in his body? Is he absolutely dead to kindness? So there you have it. I assume that John Ashcroft is not dead to kindness. That he thinks of himself as kind, lauds kindness, and aspires to it. And yet, to my mind, and even some minds to my right, he has gone wrong. One of you wrote to ask me if I really think he wants people to suffer, and the answer, of course, is no – any more than those who burned witches at the stake were sadists or thought of themselves as murderers. They were doing God’s will as it had been revealed to them. So, I think, is the Attorney General. No column Friday. This one was long enough for three. Don’t miss “The West Wing” tonight. I actually got to visit the set while they were filming it – way cool! – and saw (over and over and over and over) the little bit where President Bartlett reveals how he plans to cook the Thanksgiving turkey. (Hint: Not like a guy.) Like many of you, I feel I have a great deal to give thanks for. Not least, my terrific readership. To your good health.
Turns Out It’s Not the Black Cats You Have to Watch Out For November 20, 2001February 20, 2017 Shortly after becoming Attorney General, John Ashcroft was headed abroad. An advance team showed up at the American embassy in the Hague to check out the digs, saw cats in residence, and got nervous. They were worried there might be a calico cat. No, they were told, no calicos. Visible relief. Their boss, they explained, believes calico cats are signs of the devil. (The advance team also spied a statue of a naked woman in the courtyard and discussed the possibility of its being covered for the visit, though that request was not ultimately made.) I reveal this tidbit not to belittle John Ashcroft’s faith or his prudishness, which are his own business, but because he has begun to meddle with my business. In the middle of the war on terrorism, he has somehow found time to move to overturn Oregon’s twice-passed referendum on assisted suicide, to assure that an Oregonian in his final days should be forced to agonize as God intended. Likewise, for those nauseous with chemotherapy or in chronic pain, he works to overturn California’s referendum on medical marijuana, because – when you think of it – what right have the people of California to decide a matter of such importance for themselves? Where in the constitution does it permit people the right to grow or smoke whatever they want, even if it will ease their chronic pain? Forgive the sarcasm, but really – how dare he? Hasn’t he more important things to do? How dare he say to those in pain – not op-ed-page pain or hypothetical pain, but you-almost-want-his-children-to-feel-it-to-be-sure-he-understands-the-import-of-what-he’s-doing pain – ‘Tough. You’ll just have to suffer.’ And if his judgment on these matters, and on calico cats, is so far from humane or rational, how reassured should we be as to the rest of his program? ‘Under [Oregon’s] Death with Dignity Act,’ reports the New York Times, ‘a terminally ill patient may take the lethal drugs if two doctors agree the person has less than six months to live and is mentally competent to make the decision to end his or her life. Since the law took effect in 1997, at east 70 people have killed themselves in this way . . . Many more have obtained lethal prescriptions but have died of natural causes before taking the drugs.’ Note that many of those people who died of natural causes obtained from this law a great benefit as well. No, they didn’t wind up using the drugs. But by knowing they could get them, and by having them, they retained the option. They retained control of the decision, and of their lives. If it got too bad, they knew they had a way out. Dr. Jerome Groopman, the eminent Harvard Medical School professor, was quick to express the alarm of what must be a large segment of the medical community over Ashcroft’s action. ‘Not long ago,’ his Times op-ed began, ‘a cancer specialist I know faced a situation that chilled those of us who care for people with terminal illness. A young woman close to death lay suffering in a hospital bed, her husband at her side. Her leukemia had defied bone marrow transplant and experimental drugs. She had begun to bleed into her lungs and was gasping for air. Months earlier, following common practice, the oncologist had had a frank discussion about dying with the woman and her husband. The greatest terror for her, as for most other patients, was that the final days of her life might be spent in unrelenting pain.’ So the patient and her family and her doctor agreed that, if the time ever came, no heroic measures would be taken to prolong her agony, and enough morphine would be used to minimize her pain, even if it speeded her death. (As, Dr. Groopman went on to explain, this it would have to do, because morphine suppresses breathing.) The time came, the morphine was prescribed – but a respiratory therapist at her bedside ‘vehemently objected.’ Both husband and doctor were shocked; the doctor went on to fulfill his promise to ease the patient’s pain. Within a day, Dr. Groopman recounts, the patient had peacefully died. But the therapist – a man after John Ashcroft’s heart – accused the doctor of having committed a crime and the husband of being an accomplice. Neither charge was sustained, but now John Ashcroft has rushed in to do battle with the devil, to try to right such wrongs in the future and prolong the patient’s suffering. He has authorized the Drug Enforcement Administration to suspend medical licenses of doctors who prescribe lethal drugs for terminally ill patients. ‘This action,’ writes Dr. Groopman, ‘represents a striking lack of understanding of how physicians help patients to die, and it risks making the last days of the terminally ill a time of panic and pain rather than calm and comfort . . . Mr. Ashcroft endangers what has become a compassionate, if tacit, mode of dying throughout the United States.’ ‘If the Justice Department’s action is a political bone thrown to religious conservatives,’ he concludes, ‘it shamefully miscasts health professionals as disciples of the devil rather than angels of mercy.’ We are blessed to live in a time when those who choose Novocain can have it; when those who choose anesthesia during operations can have it. Neither of these miracles is natural, and no one should be forced to avail themselves of them. People should be free to believe in the devil, to fear calico cats, and to endure, for themselves, unimaginable pain. But for John Ashcroft to tell me that I have to endure unimaginable pain? Or that a loved one must? And just in time for the holidays. Coming Soon: Conservatives Who Part Ways with Ashcroft On This One.
Energy Policy: Le Boeuf et Le Salmon November 19, 2001February 20, 2017 Mike Leboeuf: ‘Didn’t want you to miss this column from the Washington Post.’ ☞ Good column. Thanks. Let’s tie the Arctic drilling he favors to the $1-a-gallon gas-tax hike he also favors . . . use every penny of that increased revenue to cut the FICA tax (giving people more take-home pay to spend and save, as well as a greater incentive to work), and let’s fund the hell out of alternative energy research instead of – astoundingly – cutting it in half. The problem a lot of us have with the administration’s energy policy is that it seems 100% designed to benefit the oil industry, from which our president and vice president came, as if that were even more important than doing whatever is best for the country as a whole. COOKING LIKE A GUY™ – GETTING TO KNOW YOUR HARDWARE I’m 54 and learned how a toaster-oven works today. It’s got two settings. One for toast, one for oven. Cool! This was much less complicated than I realized, once I really focused. I made some toast, then I made salmon. (My secret: salt, lemon, and first pretend the salmon is a piece of toast.) Before cooking, I actually drenched it in some fancy flavored olive oil someone gave us long ago – a kitchen decoration, is how I had always thought of the bottle, until inspiration struck. Hint: it’s OK to put a naked slice of bread right on the toaster-oven rack, but it’s a good idea to put the salmon in something, like an aluminum pan.
Getting Rich — It’s So Easy! November 16, 2001February 20, 2017 NOBODY’S PERFECT Tom Knapp: ‘Those reading McCullough’s book on John Adams should try to read an article in Sept. ’01 Harper’s Magazine by Richard N. Rosenfeld called ‘The Adams Tyranny.’ He concludes, ‘…In pandering to the highly remunerative national yearning for heroes, David McCullough denies Americans the critical lessons in liberty and democracy that every history of the Early Republic should teach.” NOT FULLY EVOLVED Will Alford, MD: ‘The quote of the day that came up for me today [they are generated randomly – you don’t all see the same one] was from Paleontologist Jack Horner: ‘It was only 80 years from the time Darwin published On The Origin Of Species until we detonated the first nuclear bomb. In the lifetime of one person, we went from figuring out where we came from to figuring out how to get rid of ourselves.’ My favorite quote is not entirely unrelated, from Konrad Lorenz, the famous zoologist: ‘I think I have found the ‘missing link’ between the animal and civilized man. It is us.’‘ THE INVISIBLE – BUT NOT INFALLIBLE — HAND James Elbeu: ‘I read George Soros’ Global Capitalism and found it refreshing that a billionaire would counter the idea that the free enterprise system is one that serves those who deserve wealth, etc. He says the idea of ‘the magic of the market place’ is stupid. That a lot of people fall between the cracks. His term for the wrong-headed belief that it’s all a perfectly balanced system is MARKET FUNDAMENTALISM. I thought that a great term.’ ☞ Fundamentalism of any kind is pretty scary. The free market is spectacular – but even it needs checks and balances. . . . AND SPEAKING OF BALANCE John March: ‘You write that ‘enterprise, ambition, desire, and invention are good,’ but your support for the confiscatory federal estate tax tells a different story.’ ☞ I really doubt this tax has done much to inhibit enterprise, ambition, desire, or invention. Look at the last 10 years. A time of tremendous hard work and exciting innovation, and – certainly – ambition. Yet we had this tax. Don’t you think it’s all a balance? That exempting 98% of everybody is a good start; that exempting spouses helps; that raising the ceiling to an inflation-adjusted $2.5M or $5M and lowering the 55% to 45% might not be about the right balance to put this issue to rest for a long, long time? I’d sure favor that myself. Has America really dealt its enterprising, ambitious citizens a bum hand? Is there a better place, on balance, to be enterprising and ambitious? INVESTING IS SO EASY! Kirk D: ‘I have read your book and used your mutual fund calculator. I know you are strongly against managed funds and pro-indexing. However, I would appreciate your analysis of the following [note to readers: you can skip the fine print]. Question: What % interest per year does a manager have to earn to equal S&P 500 if the latter earns 11% per year on average? y=P(1+x)**n y is total money earned at the end of n years; P is principal amount placed in at time=0; x is decimal average interest earned per year. Let x1=% manager has to make x2=0.11 Solve for x1 for different numbers of years. Here are the surprising results: If the load fund skims off 6% of your initial principal, the manager will have to average 18,12.4, 11.7, 11.3, and 11.2% for 1,5,10,20, and 30 years. Each of these percentages should be increase by the yearly management fee, let’s say 1.5%. So over 20 years, the manager must make 12.8% to equal the market. Let’s take an extreme example. If the load funds skims off 50% of your deposit, manager will have to average 122, 27.5, 19, 15, and 13.6% over these same times, plus the management fee. I spent a few minutes looking up top-rated mutual funds over 10 years. Compare Smith Barney Agg. Growth Fund A to Vanguard 500 Index Over past 3 years ending 9/21/01 +25.2% vs. -1.4% Over 10 years 16.82% (includes effect of max. sales charge) vs. 12.61% (9/30/01) Over 17 years since inception, SB Agg. Growth has yielded 15.62% including effect of max sales charge. I don’t have S&P for this time period, but doubt it is better. Do you consider SB a flash-in-the-pan? ‘My conclusions from these data: 1. Front-end loads up to 10% are negligible if you keep the money in 10 years or more. 2. There is a minority of well-managed funds that beat the market by 3-4% over 10 years, and perhaps that much over 20 years. A few minutes of research on the web or a magazine/newspaper will reveal them. What am I missing?’ ☞ Nothing! So long as you can identify in advance (incomparably harder than in hindsight) the very few funds that will significantly outperform the averages over the long run . . . and so long as you are investing in a tax-deferred account (because actively managed funds are so much less ‘tax-efficient’ than index funds) . . . you are golden. Another simple solution to the same problem: find a stock that will perform really well in the future (not just one that has done so in the past), and buy it. Works every time. WEEKEND READING I’m not saying I agree with every word of this – I like to think the author is being too alarmist. Even so, if you have time, click here.
Greed November 15, 2001February 20, 2017 But first: Rick Boyd: ‘You often mention that you purchase items with a credit card so as to earn frequent flyer miles. This is starting to sound like a good idea to me, but I don’t have a clue as to how to get a card that offers these miles as an inducement. How can I find such a card?’ American Express has its “Membership Rewards” program any cardholder can sign up for. The miles can be transferred to your frequent flier accounts at several airlines, though not, notably, American or United. Still, between Delta, Continental, US Airways, Southwest, Virgin Atlantic and some others – and those airlines’ own travel partners – you should be able to get just about anyplace. Diners Club is good on all the major U.S. airlines. Otherwise, check the website of the airline you most frequently fly and get its Visa or MasterCard. With any of these, though, there is likely to be an annual card fee. So you have to factor that into your thinking. And of course you must never, never, ever do this if you run balances and rack up interest, because the interest charges (18% or whatever) will dwarf the value of the miles (2% or so). And now, 3 greed-related items: 1. From the Borowitz Report: The Taliban is out — and Starbucks is in. That’s the word from Kabul, Afghanistan, where, moments after the repressive Taliban government fled the city, the trend-setting coffee purveyors from Seattle were open for business. Some observers questioned whether Starbucks would succeed in a place where, in earlier eras, both the Soviet Union and Great Britain had failed. But no worry: in its first day of business, Starbucks was a big hit, with the first “barristas” in Kabul working ’round the clock to serve their new customers, many of whom had just had their beards shaved off at the newly-opened Supercuts next door. The demand for their product was so strong, in fact, that by the end of the day two more Starbucks stores had opened, all within three blocks of each other. . . . ☞ Listen: Greed is good! Or at least enterprise, ambition, desire and invention are good. We assign a pejorative connotation to the word greed, suggesting that it is lust-for-money that has lost its sense of proportion and decorum. But it’s largely a matter of degree. Starbucks does a good job. More power to them. But what do you make of this next one? 2. By Matthew Miller: CEO SHAMED ON PAY AT LAST! (But Has $300 Million to Drown Sorrows) Scientists thought it impossible, but we may finally be getting a precise measure of the outer boundary of corporate shame. It goes like this: If you’re a CEO who’s already made $300 million from stock options by cooking the books, then when the hoax is exposed and your wrecked firm is taken over, a further $60 million severance payout makes even you blush. That’s one lesson to draw from the meltdown at Enron, the high-flying energy firm that turns out to have been a house of cards. The business headlines make it sound as if CEO Kenneth Lay’s decision to waive his contractually guaranteed $60 million severance is the act of a statesman, but a closer look suggests it’s a signal of shame. Lay led Enron as it grew from a pipeline operator over the last decade to become the nation’s largest energy trader, a business Lay basically invented. But Lay’s innovations apparently included some creative accounting, through which Enron overstated its earnings in the last five years by nearly $600 million, an inflation that helped boost Enron stock. These were the same years when Lay exercised stock options that gave him the bulk of the $300 million he’s earned at the helm. While Lay has presumably tucked most of those millions away in other safe investments, Enron employees whose stock sits in 401(k) plans have seen its value drop by 90 percent as the firm’s woes have emerged. This gap between the boss and the rest no doubt helps explain the revolt that took place the other day as terms of Enron’s humiliating sale to smaller rival Dynegy were being finalized. When word of Lay’s severance package swept through the firm, ‘quite a bit of concern was raised,’ said a corporate spokesman. Translated, that means Enron’s top traders – the men and women responsible for the bulk of the firm’s profits – screamed bloody murder about the idea that the boss would make out like a bandit even as the company went down the tubes. And so Lay backed down. Unfortunately, however, Lay’s ethic of entitlement is the norm in corporate America, as showcased in an underappreciated Fortune magazine June cover story on ‘The Great CEO Pay Heist.’ Fortune reporter Carol Loomis [‘the estimable Carol Loomis,’ if I may interject a personal comment – A.T.] spoke to seven heavyweights who serve on the compensation committees of big company boards of directors – many of them CEOs themselves. She promised them anonymity in exchange for candid views on the state of CEO pay. Listen to what they said – and remember, these aren’t left-wing radicals talking, but major corporate leaders: — ‘The scandal of what goes on … is how much is paid in the many, many instances when it isn’t at all deserved.” — “People (board directors) understand … they have to go along with (what) management (proposes for its own pay), because if they don’t they won’t be part of the club. You sort of get rolled by the system even if you try to do well.” — “There’s no one representing the shareholders. It’s like having labor negotiations where one side doesn’t care. That would be a travesty, and this is too.” — “It’s basically what’s called a ‘corrupt system’ … where non-evil people do evil things. That’s the real problem. If there are corrupt people, you can do something about it. If it’s a corrupt system, its very difficult … stockholders are going to continue to get screwed.” — “There’s something intrinsically wrong with some of these amounts of money. I don’t know that anything will stop that except self-control. But to ask for self-restraint flies in the face of human nature.” So forget about today’s war profiteers. As the Enron case shows, it’s the regular old peacetime profiteering that’s so demoralizing and corrosive for capitalism. And don’t hold your breath for reform. “Government isn’t going to change anything,” said one of Fortune’s cynical insiders. “We’re not going to turn into Cuba. When you’ve got some smart lawyer (advising management) … working against two members of Congress … it’s no contest.” Columnist Matt Miller is a senior fellow at Occidental College in Los Angeles. His e-mail is mattino@worldnet.att.net. ☞ Speaking of which, at least tangentially, Richard Factor writes: “I’m curious. If they WANT to sell I-Bonds, why the $30K annual limit?” Good question! Imagine a horde of bank and brokerage firm lobbyists (banks and brokerage firms make nothing when you buy savings bonds), and you may have the answer. Finally: 3. Here is Paul Krugman tying a lot of pieces together in yesterday’s New York Times. I hope you find time to click the link. It is, as may possibly have been mentioned in this space once before (so many columns, who can keep track?), a grand time to be rich and powerful in America.* *As has also been noted before, I’m not against the rich and powerful. I love ‘em! I just see no reason to tip the balance more heavily in their favor. The Republicans have given new meaning to the word “brazen” on this score.