Dick Cheney Has Better Health Insurance than You But Would It Cover an Aspirinectomy? May 15, 2008March 11, 2017 DON’T SNEEZE WITH YOUR MOUTH FULL It can never end well. There is the obvious reason (well, think it through). But there is also the problem of the intake, precedent to the violent exhalation. Rather like the curious way Neptune sucks the tide back from the shore (what hazard could that pose?) precedent to the violent onrush of the tsunami. Indeed, even a yawn, which is almost all intake and relatively mild outrush, poses very much the same risk. Say, for example, you have half an aspirin on your tongue, about to swallow, and suddenly there is the intake of a sneeze or a yawn. Do you know how dangerous it is to inhale an aspirin? Worse than inhaling even a mosquito, let me tell you; and to prevent the inhalation of mosquitoes, whether yawning or sneezing, we are trained to raise our hands to our mouths. (Forget etiquette or germs; we do this to keep the bugs out.) But what good will the polite hand-to-mouth maneuver do when the object – in this case the half aspirin – has already breached security and is inside the city walls? (Indeed, you placed it there yourself, as the Trojans did their horse.) Answer? None whatsoever. One minute you are king of the world. The next you are coughing violently, unable to ask your doctor what to do (surely not take two aspirin and call him in the morning) because you are unable to speak. Sometimes you don’t die from this, I am pleased to be able to report. But it makes an impression on you nonetheless. McCAIN’S WEALTH Mike: ‘So what if McCain has some money. So do Warren Buffett, George Soros, Teddy Kennedy, Nancy Pelosi, Jay Rockefeller, John Kerry – what, is it only OK if liberal Dems have a few bucks? What’s with the obsession with class warfare with you Dems?’ ☞ Well, we should start by remembering Buffett’s remark that ‘if this is class warfare, my class is winning.’ But I think the point is that the R’s want to paint Obama as ‘elitist’ and unable to truly relate to the average American, whereas John McCain is just like them, and knows the price of a quart of milk (as it were). It’s fine to have a ton of dough (especially if you earned it); less fine, in the view of some of us, if, having a ton of dough, you pledge to keep taxes on rich people low and eliminate the estate tax. It’s also fine to windsurf – but did you see how they destroyed Kerry over that? So, nine houses and a private jet MAY be the mark of a man who really ‘gets’ the plight of the middle class and the disadvantaged . . . who wants to live lightly on the land and promote sustainability. But maybe not? RICHARD NIXON AND DICK CHENEY ON HEALTH CARE Be sure to go to the bottom to click the 16-minute video clip. (Thanks, James.)
Inflate, Investigate, Instigate (InflationGate?) May 14, 2008March 11, 2017 JON STEWART ON LARRY KING Dean Reinemann: ‘Larry brought up the subject of the primaries and asked Jon if America was ready for a woman or a black president. Jon looked at him quizzically and said, ‘This is such a non-question. Did anyone ask us in 2000 if Americans were ready for a moron?’ ‘ ☞ Ouch. Bush is hardly a moron. He wanted the rich – in particular the oil guys – to do well and they have (phenomenally well). He promised to appoint more Justices like Clarence Thomas and Antonin Scalia and he did. He didn’t want to work terribly hard and he hasn’t. He wanted to show that government can’t do things very well, and he has. Morons are not usually so successful in getting what they want. BIG TYPE Scott Nicol: ‘If you use Firefox, you might want to try nosquint. It remembers the zoom level you select (by CTRL +/-) for each site you visit so that you only have to adjust it once. I have your site at 120%.’ THEY’RE LYING TO US . . . Tom Cuddy: ‘That Kevin Phillips link last Thursday was a great read. I remember when a lot of these statistical tweaks were made. They were all reported on and we were warned by some that the changes were made with a purpose in mind. But like a lot of issues, they were forgotten. Our national policies are routinely adjusted based on unreliable comparisons to earlier economic reports which used different criteria for their measurements. That’s why a lot of Americans know that the official unemployment figures, GDP numbers, and inflation are out of touch with reality. Unemployment figures especially are useless because of the revolution of the last 20 years in which employers now use part-time and 1099 workers to a far greater degree. In the construction industry, where I have been for the last thirty five years I can say with conviction that fewer than 20% of on site construction workers are employees. Count the 1099 guys and illegals who have been axed and you would get a truly gruesome image of how far construction employment has fallen. Yet I read that by some ridiculous correction, construction employment is actually slightly on the rise! In the words of Joe Pesci in my favorite movie, ‘My Cousin Vinnie,’ that’s B.S.’ TIPS John McInnis: ‘If the Kevin Phillips article is correct – that the government figures for inflation are grossly and systematically understated – wouldn’t that mean that TIPS, whose payouts are based on those statistics, are a lousy investment, in effect guaranteed to return less than the real rate of inflation?’ ☞ Boy, can you just imagine the class action suit to be waged over that? Talk about billions! (Except, doesn’t the U.S. government have to give permission before it can be sued?) Long-term TIPS (Treasury Inflation-Protected Securities) were a better investment when we bought them at par than they are now, considerably higher. But I have held most of mine, because (a) it’s still better inflation protection than nothing and (b) I’ve kind of assumed that much of the ‘real’ inflation rate would eventually be reflected, as (for example) the rising cost of gasoline worked itself into the all the components of core inflation. But I haven’t done as much investigation of this as I should . . . and it may be instigation we need more than investigation (as in: ‘TIPS holders and Social Security recipients of the World, UNITE!’).
Tuesday, Bluesday (As In: Singing Them) May 13, 2008March 11, 2017 IT’S THE END OF THE WORLD – 2 Last Tuesday, I suggested it was the end of the world because John McCain has nine homes and yacht charters run $380,000 a week (and those are not even the really big yachts) and CEOs make 433 times the pay of their average worker, up from 40 times in 1980 and 25 times in 1965 . . . and because John McCain wants to ‘make the tax cuts permanent,’ which means not only embracing them for income above $200,000 and $2 million and $20 million (so CEOs can afford those yacht charters) and $200 million (so hedge fund managers can buy $150 million paintings) but means, also, allowing the estate tax rate on billionheirs to drop, in 2010, as written in the current law, from 45% to zero. This Tuesday, I offer you Bill McKibbens’ planetary warning. (‘The planet is nearing a tipping point on climate change, and it gets much worse, fast.’) Unless you have a second home on Mars, I’d take the time to click. The solution may not be John McCain’s 18-cent-a-gallon gas tax holiday. Which leads me to: YOUR REBATE CHECK Doug Olson: ‘I don’t think I really need to save more and am perfectly happy to spend my $300 check to help stimulate the economy. But I don’t think buying Saudi oil, Korean electronics, or Indonesian clothing is going to help it much. What kind of spending (besides food) would do the most to stimulate the UNITED STATES economy?’ ☞ Contributions to the DNC. They go not only to averting a third Bush term, but also to turning out the vote for a wider majority in Congress so we can actually get things done. (I know some Democrats are angry with their own party for not getting more done – although click here and here for a look at what’s kept us busy – but you have to remember that our powerful majority in the 100-member Senate currently consists of 49 Democrats, one of whom was in a coma for several weeks, plus two Independents who caucus with us, one of whom has endorsed McCain. With a ‘majority’ like that, and faced with a record-breaking number of filibusters – more than 60 since the Republicans found themselves gavel-less 16 months ago in – it’s hard to get much passed for the Presidential to veto.) BIG MAC Are my political leanings coming through loud enough? Perhaps I should use a larger font. Les Rosenbaum: ‘I just read of your appreciation for the CTRL+ key combo in Windows. Take it from me, a visually impaired person, that you haven’t seen anything yet. No pun intended! I use both PC and Mac. On the Mac, all you have to do is hold the CONTROL key and move the scroll ball on the mouse up or down. This will enlarge ANY application, ANY screen without horrible distortion. It’s dynamic, quick, and works fabulously. Check it out. I think you’ll be amazed. If for no other reason, this one feature makes the Mac the best choice for those with a little or a large eye problem.’
Viewer Discretion Advised May 12, 2008March 11, 2017 RED STATE UPDATE Please do NOT watch this if you are offended by raw language or crude caricatures. (Sorry I’m a couple of weeks behind with this – I just saw it.) McCAIN – MAVERICK? Well, not so much. Click here . . . On Wednesday, John McCain’s home state Arizona Republic did some good excavation work in the ongoing demolition of the GOP nominee’s maverick myth. Analyzing his Senate voting record since 1999, the paper found McCain rarely strayed from the Republican Party line. But that’s only a small part of the unraveling of the McCain maverick fable. As I previously detailed, John McCain in his eternal quest for the GOP nomination has repeatedly reversed long-held positions and compromised core principles to curry favor with right-wing Republican primary voters. As the Republic details, when the going got tough, McCain got in line. When it mattered most in the closest votes, Senator McCain since 1999 sided with his GOP colleagues. . . . LARGER TYPE Troy Cassel: ‘In addition to Ctrl+, you can also hold down Ctrl and use the trackball on the mouse to adjust the size of the text. It also works in Outlook, Word, Adobe Reader and various other programs.’ FMD So now the company is being sued on behalf of disgruntled shareholders (which I assume includes all of us), but I’m not so sure there’s much to it. I asked my FMD guru – a somewhat rueful sobriquet by this time – who responded: My gut wrenches every time I think about FMD….for so many reasons…. But as to the lawsuit: The complaint alleges that during the Class Period, defendants (being the corporation and selected members of the management team) issued materially false and misleading statements that misrepresented and failed to disclose: (a) that the loans underlying the Company’s bonds were experiencing increasing default rates; (b) that the guarantor of those loans – TERI – did not have the money to buy all of the loans that were in default; (c) that the Company lacked adequate internal and financial controls; and (d) that as a result of the foregoing, banks would look elsewhere to package their loans, which would have a negative impact on First Marblehead’s business and operations. Based on what I know and interpret, (a), (b), and (d) appear to be without merit. On (a), I cannot recall or identify any instance when the company misrepresented the credit performance on their book of business… the collateral damage caused by the subprime mortgage meltdown has caught almost all lenders by surprise and rendered many highly sophisticated underwriting and performance management tools ineffective; (b) the deterioration of loan guarantors is not specific to FMD, and the coverage ratios set aside should have been more than adequate to cover historical performance thresholds; (d) the primary cause of FMD’s current troubles is the seizing up of the securitization markets, and the inability of client banks to move their assets off balance sheet – symptoms shared by almost all players in the private student loan space (and most other asset classes that rely on securitization for liquidity). (C) may or may not be true, and will require an extensive review of the company’s internal control structures and processes. ☞ If the lawsuit is successful and there’s any cash to be had, those of us who held the stock during the time period covered in the suit may get a few pennies whether we still hold the stock (as I do) or not. I do think that students will continue to go to college and that some of them will need to borrow beyond the limits of government-sponsored loans. So there may be a business here yet. But there is certainly the possibility FMD will not survive. So if you never bought FMD – thank heavens. And if you buy a few shares now, down nearly 95% from its peak, only do so with money you can truly afford to lose, because you may.
The K Street Express May 9, 2008March 11, 2017 SAVE XP ‘Help save Windows XP.’ [If you tried this link before I fixed it yesterday – my apologies.] JOHN McCAIN New York Magazine ran an entertaining profile last month, portions of which should give Democrats encouragement. E.g.: That McCain’s political resurrection owed as much to the weakness of the Republican field-not to mention blind shithouse luck-as to his talent and grit makes it no less remarkable. Yet for all the hosannas being sung to him these days, and for all the waves of fear and trembling rippling through the Democratic masses, the truth is that McCain is a candidate of pronounced and glaring weaknesses. A candidate whose capacity to raise enough money to beat back the tidal wave of Democratic moola is seriously in doubt. A candidate unwilling or unable to animate the GOP base. A candidate whose operation has never recovered from the turmoil of last summer, still skeletal and ragtag and technologically antediluvian. (‘Fund-raising on the Web? You don’t say. You can raise money through those tubes?’) Whose cadre of confidantes contains so many lobbyists that the Straight Talk Express often has the vibe of a rolling K Street clubhouse. Whose awkward positioning issues-wise was captured brilliantly by Pat Buchanan: ‘The jobs are never coming back, the illegals are never going home, but we’re going to have a lot more wars.’ A candidate one senior moment-or one balky teleprompter-away from being transformed from a grizzled warrior into Grandpa Simpson. . . . McCain has been unwavering in his commitment to keeping U.S. troops in Iraq for an indeterminate period of time. And this stance puts him on the wrong side of the public on one of the two central issues on which the general election is likely to turn. . . . McCain’s difficulties may be even more pronounced on the second pivotal issue: the economy. During the New Hampshire primary, McCain blurted out the domestic equal of his ‘100 years’ gaffe: ‘The issue of economics is not something I’ve understood as well as I should; I’ve got Greenspan’s book,’ he said, though he later allowed that he had yet to crack its spine. . . . Even the most loyal Republicans express concern about McCain’s economics gap. ‘He’s never been particularly fluent in or showed much intellectual interest toward economic matters,’ says Pete Wehner, who ran the Office of Strategic Initiatives in Bush’s White House. ‘Can he speak fluently or compellingly about them? We’ll soon see. But it would require him to lift his game.’ . . . ‘People don’t realize that he’s Bush II on economic policy,’ says Mike Podhorzer, the deputy political director of the AFL-CIO. ‘When we tell people in focus groups where he is on health care, Social Security, and the minimum wage, they are shocked. And they immediately say, ‘I have to reconsider what I think about him.’ ‘ ☞ Of course, the press enjoys spending time with him, which is an asset not to be underestimated. If the press had been half as tough on Bush as it was on Gore, Gore’s margin of victory in 2000 would have been unstealable. Unequal press treatment can write history. Speaking of which, did you catch Bill Press‘s column yesterday? THE CANDIDATE AND THE PASTOR By Bill Press Tribune Media Services Imagine this: A preacher endorses a candidate for president. Then we learn the preacher has, for years and from the pulpit, made disgusting, inflammatory and un-American statements. Yet the mainstream media totally ignores the preacher’s remarks and never pressures the candidate to explain all the ugly things the preacher has said and done over the last 20 years. Impossible scenario? That depends on whether your name is Barack Obama or John McCain – and whether the preacher’s name is Jeremiah Wright or John Hagee. Obama, of course, was held personally responsible by the media for everything Jeremiah Wright ever said, and forced to repudiate him. McCain, on the other hand, has been given a free ride by the media and never challenged to answer for Hagee’s comments – even though, in many ways, they are more outrageous than anything heard from Pastor Wright. Hagee is founder and senior pastor of San Antonio’s 19,000-member Cornerstone Church. He’s also a leading televangelist, whose radio and television broadcasts are seen and heard in 99 million homes. On many occasions since he began his ministry in the 70s, Hagee has come under criticism for his controversial remarks on women, gays, Israel and Catholics. Hagee shows no mercy for the Catholic Church. He has called it “the Great Whore” and “an apostate church,” and accused Catholicism of being nothing more than “a false cult system.” Hagee also blames the Catholic Church for the Holocaust, telling viewers in one telecast that Hitler learned his hatred for Jews from growing up as a Catholic. When launching his wholesale slaughter of Jews, according to Hagee, Hitler told his followers: “I’m not going to do anything in my lifetime that hasn’t been done by the Roman Church for the past 800 years. I’m only going to do it on a greater scale and more efficiently.” On women, Hagee makes St. Paul, notorious for treating women like second-class citizens, look like a feminist. “Do you know the difference between a woman with PMS and a snarling Doberman pinscher?” asks Hagee. “The answer is lipstick.” As if that’s not insulting enough, he continues: “Do you know the difference between a terrorist and a woman with PMS? . . . You can negotiate with a terrorist.” Real cut-up, that John Hagee. We all remember that Jerry Falwell and Pat Robertson were condemned for asserting, the day after Sept. 11, that God had punished America for, among other “sins,” our tolerance of gays. Yet John Hagee made a similar claim five years later about Hurricane Katrina and nobody cared. Appearing on NPR’s “Fresh Air” on Sept. 18, 2006, Hagee said: “The newspaper carried the story in our local area that was not carried nationally that there was to be a homosexual parade there on the Monday that Katrina came. And the promise of that parade was that it was going to reach a level of sexuality never demonstrated before in any of the other Gay Pride parades.” An incredulous host Terri Gross asked if he was really saying that God had flattened the entire city of New Orleans, because a gay pride parade was scheduled in the French Quarter. Yes, said Hagee, that’s exactly what I meant. “All hurricanes are acts of God because God controls the heavens. I believe that New Orleans had a level of sin that was offensive to God and they were recipients of the judgment of God for that.” Hagee is also founder of Christians United for Israel, which sounds innocuous enough until you realize that, like most evangelical Christians, he only supports Israel in order to trigger another war that would bring about the end of the world. As he himself told a July 19, 2006 CUFI event in Washington, D.C.: “The United States must join Israel in a pre-emptive military strike against Iran to fulfill God’s plan for both Israel and the West . . . a biblically prophesied end-time confrontation with Iran, which will lead to the Rapture, Tribulation and the Second Coming of Christ.” Now here’s what’s different about Obama/Wright and McCain/Hagee. John McCain actually sought out Hagee’s endorsement, said he was proud to receive it, and continues to brag about it. My question is not: How could a Christian preacher say such ugly things? But rather: Why did the media pay so much attention to one preacher, and zero attention to the other? Bill Press is host of a nationally syndicated radio show and author of a new book, “Trainwreck: The End of the Conservative Revolution (and Not a Moment Too Soon).” You can hear “The Bill Press Show” at his Web site: billpressshow.com. His email address is: bill@billpress.com. © 2008 Tribune Media Services, Inc. ☞ I would have cracked in that P.O.W. camp in the first five and a half minutes, let alone five and a half years. We should all honor McCain’s service. But his votes in the Senate, decades later, have not helped average Americans or moved the country forward. And the first two Bush terms were not so good that they warrant a third.
The True Inflation and Unemployment Rates (Higher than Reported) May 8, 2008March 11, 2017 SAVE XP Peter Thibeau: ‘Help save Windows XP.’ ☞ Yes, please. THEY’RE LYING TO US . . . George Hamlett: ‘Here‘s a link to a Harper’s article by Kevin Phillips that expands on Mauldin’s points you linked to in Monday’s column.’ ☞ This is an important companion piece for those who want to understand the true growth, employment, and inflation numbers. (Phillips makes it clear there’s plenty of blame for both Democrats and Republicans.) It would be a real surprise if the worst were over, no matter how the numbers are reported. Then again . . . LOVE IS ALL YOU NEED Circling the Internet . . . A group of professionals posed this question to a group of 4 to 8 year-olds: “What does love mean?” The answers they got were broader and deeper than anyone could have imagined. [Among them:] “When my grandmother got arthritis, she couldn’t bend over and paint her toenails anymore. So my grandfather does it for her all the time, even when his hands got arthritis too. That’s love.” – Rebecca, age 8 “When someone loves you, the way they say your name is different. You just know that your name is safe in their mouth.” – Billy, age 4 “Love is when a girl puts on perfume and a boy puts on shaving cologne and they go out and smell each other.” – Karl, age 5 “Love is when you go out to eat and give somebody most of your French fries without making them give you any of theirs.” – Chrissy, age 6 “Love is what makes you smile when you’re tired.” – Terri, age 4 “Love is when my mommy makes coffee for my daddy and she takes a sip before giving it to him, to make sure the taste is OK.” – Danny, age 7 “Love is when you kiss all the time. Then when you get tired of kissing, you still want to be together and you talk more. My Mommy and Daddy are like that. They look gross when they kiss.” – Emily, age 8 “Love is when you tell a guy you like his shirt, then he wears it everyday.” – Noelle, age 7 “During my piano recital, I was on a stage and I was scared. I looked at all the people watching me and saw my daddy waving and smiling. He was the only one doing that. I wasn’t scared anymore.” – Cindy, age 8 “Love is when your puppy licks your face even after you left him alone all day.” – Mary Ann, age 4 “Love is what’s in the room with you at Christmas if you stop opening presents and listen.” – Bobby, age 7
This Man Gets on a Bus . . . May 7, 2008March 11, 2017 ARE YOU HAVING TROUBLE READING THIS? I find myself using CTRL+ more and more. In Explorer, Firefox, Safari, and Opera, just hold down the CTRL key while tapping the +/= key a time or two or three. A second or so later, in most cases, the text gets wonderfully large. WIND POWER Already meeting 20% of its electricity demand from wind turbines, Denmark is now trying to find good ways to use the excess generated on especially windy days. Spain is doing equally well. We’re even making progress here. (Scroll down quickly and you’ll see the U.S. getting greener by the year.) As I’ve suggested, with innovation like this we could be out of the woods in 20 years. Getting from here to there, though, will be no [insert painfully obvious double entendre here*]. * I just can’t bring myself to do it; and yet it cries out to done. Like a sneeze you just can’t restrain. (It rhymes with sneeze.) GLDD Here‘s the first quarter earnings release. And here‘s the conference call. Backlogs are up. Dredges have been redeployed to the Middle East (I picture ducks paddling very slowly from the U.S. to Dubai, earning no revenue as they go, but positioning themselves for future gains). The dredge hit by the orange juice tanker (you can’t make this stuff up) should be back in service soon. Hang on. TXCO Here‘s the first quarter earnings release. And here‘s the conference call. I’m holding on. TRBR I hope you didn’t buy it when I first did. Now, more or less half-price, it’s a better deal. They just announced a Justice Department price fixing investigation. As I understand it, they are not a principal target. I’ve bought a little more. PARROT JOKE Richard Vroman: ‘Since you keep threatening us with these, I thought you should have a fresh one ready. Here’s a candidate: A very conservatively dressed, prim and proper upper middle-aged business man gets on the bus – dark three-piece suit, hat, tightly rolled umbrella, expensive leather brief case and all. There’s only one seat, opposite a flamboyant punk wearing metal-spiked leather with a safety pin through his cheek, piercings with studs in tongue, eyebrows, and ears all topped of by spiky green, orange, and purple hair. The older man can’t stop staring. The punk gets more and more uncomfortable during a long ride. Finally he says, ‘What’s the matter old man? Didn’t you ever do anything stupid when you were young?’ The business man pauses a minute and then says, ‘Once I had sex with a parrot. I was just trying to figure out if you were my son.’ ‘
Cake May 6, 2008March 11, 2017 MY BOYFRIEND, THE METROSECTIONAL That’s right: Page B11 of Saturday’s New York Times Metro Section. Complete with a photo of what the Times calls ‘Charles Nolan’s delightful costumes.’ IT’S THE END OF THE WORLD The costumes were for a new ballet portraying the life of Marie Antoinette, entitled ‘Cake’ -a bread substitute it’s not clear Ms. Antoinette ever actually suggested any peasants eat. But whether she did or not, some would say the ballet is aptly timed, as the sharply rising price of food is driving the world’s poor to the brink. Speaking of which, did your Fraser Yachts brochure arrive in the mail? Mine did. It’s a handsome over-sized full-color hardcover book showing off the fantastic places you can enjoy splashing about this summer – the Caribbean, the Maldives, Vanuatu, the Greek Isles and so forth – with a two-page spread on each of the 90 or so yachts available for rent. There’s even a special section for budget yachts less than 115 feet long, like Miss Money Penny, at – adorably – 82 feet (isn’t that cute?), with a crew of three and a weekly charter price under of $55,000. In a sense, the whole brochure is for ‘budget’ yachts, because not a single mega-yacht is listed. Only two of the 90 bust the 200-foot mark, Lady Lola and Force Blue; and those, just barely. (Each will be in the Western Mediterranean this summer, yours for $380,000 a week.) That’s shrimpish compared with the late Saddam Hussein’s old 269-foot Ocean Breeze (‘storage space for a large cache of weapons, including heavy machine guns and surface-to-air missiles, and a secret passage that runs the length of the boat for easy access to a fast patrol boat and a mini-submarine pod for emergency exits’) . . . let alone some of the really big ones, at least a dozen of which, like the Christina O ($700,000 a week), exceed 325 feet (a football field). Paul Allen’s 416-foot Octopus, with its crew of 60, includes a 12-passenger submersible that can stay under water for perhaps two weeks. But getting back to the boats in the brochure (I hope I haven’t spoiled them for you; they seem quite modest now, don’t they?) . . . I don’t know if there’s sales tax, or what you’re supposed to tip the crew. (And the fuel on these babies is measured not in ‘miles per gallon’ but gallons per mile, so figure maybe $100,000 for a full tank.) What I do know is that you’re not flying to and from yachts like these on a commercial airline, thank you very much (when was the last time you took the subway to shop at Cartier?) . . . so if you don’t already own your own plane, figure maybe $100,000 more. But (and here’s where we get back to the ballet) it’s not just the cost of a week off the Costa Brava that’s begun to pinch. The price of rice has doubled. What to do? I say: tax breaks for Hummers and make the tax cuts for the wealthy permanent. ‘It’s the end of the world’ popped into my head as I was touring a $7 million apartment a friend had just purchased as a third residence he plans to use about eight weeks a year. It’s really, really nice – and will be nicer still once it’s built out (add another million). Only two of the building’s 70 eventual residents had moved in as we walked through, but the whole place was fully staffed, including the gym, whose employees were excited (startled?) to see us stick our heads in. My friend figures the condo charges and taxes will be around $300,000 a year. Not to mention the cost of his housekeeper, for whom he has bought a separate $500,000 unit. Thank heavens hedge-fund managers’ bonus pay is taxed at 15% instead of as ordinary income! How could he make ends meet otherwise? My not-so-secret agenda was to wrest from this friend yet more money for the DNC. I failed, but have an offer to use the space for a fundraiser in 2009, when it’s ready. You may wonder, how can you be friends with this guy? Simple. He’s warm, funny, brilliant, generous, committed to progressive causes. He makes me laugh and shares his vulnerabilities. I love him like a brother. But I sense trouble ahead. The gap between rich and poor grows ever wider. We need a course correction. And we won’t get a course correction if we opt for a third Bush term. Tomorrow: Another Parrot Joke
Fun / Not Fun May 5, 2008March 11, 2017 FUN MoveOn.org sent its list this 60-second quiz, wherein you get five chances to show you know the difference between President Bush and Senator McCain. It’s fun! See how you do! (For those willing to enter a real – or fake – email, there’s an equally interesting 60-second bonus round, followed by an even quicker ‘carrot round.’) EDY’S TANGERINE FROZEN FRUIT BAR Summer is coming and I think it’s important that you know about Edy’s Tangerine Frozen Fruit Bars. They are so tangy and sweet! So cold and refreshing! And here’s the thing: You can have one . . . and then a few minutes later, another. And then ANOTHER! And – I know this to be true because I just did it – ANOTHER. And because they’re only 80 calories each and no fat, you’re still way ahead of where you’d have been eating just half a slice of cheesecake. Life is good. Now take that quiz. NOT FUN John Mauldin (no radical) explains how they manipulated the numbers to show a sliver of growth the last two quarters when in fact there were slight declines. So, yes, by the most common definition (two consecutive quarters of negative growth), we’re in a recession. And, he explains, the economy in April lost closer to 300,000 jobs than the reported 20,000 – as will be confirmed when the numbers are eventually revised. If you don’t believe these assertions, I think you will after you read his explanation. He goes on to make the case for looming sharp hikes in the price of meat and chicken (the price of corn is no longer – what is the idiom? – chickenfeed). It is not a pretty picture. Our SUVs continuously convert our wealth into pollution, burning a blend of oil (that we buy from the Saudis, more or less, with money we borrow from the Chinese) and corn (that would otherwise go to feed the chickens). With $6-a-bushel corn (for decades, it was around $2), those chickens cost more to feed. The feed itself costs more to transport to the chickens (because fuel prices have risen). The chickens cost more to transport to your local KFC (because fuel prices have risen). Your KFC costs more to heat, light, and cool (because fuel prices have risen). If the price of every physical thing is rising because of higher fuel costs, then inflation – and long-term interest rates – might be expected to rise also. This is not good news for the housing market. Or the stock market. But if you’re a CEO making 433 times as much as his average employee (up from 40 times as much in 1980 and just 24 times as much in 1965) . . . or a Senator who owns a bunch of houses (John and Cindy McCain own eight or nine) . . . or a hedge fund manager whose multi-million-dollar performance bonuses are taxed at 15% (because the Republicans blocked a move to tax them as ordinary income), you should weather all this just fine. (Even so, take that quiz.)
Putting the Con in Economics Look How Well It Worked Under Bush May 2, 2008March 11, 2017 Yesterday, I ended with this overview . . . We all honor McCain’s service. Or certainly should. But what of the rest? The fact that he’s likeable (like George W. Bush) – and got mediocre grades (like George W. Bush) and comes from wealth (like George W. Bush) . . . and thinks invading Iraq was the right move (like George W. Bush) and wants to appoint ‘clones’ (his words) of the Justices George W. Bush appointed . . . and can’t keep straight whether Iran is Shiia or Sunni (as Bush couldn’t name the president of Pakistan) . . . and wants to make the tax cuts for the wealthy permanent, like George W. Bush (Dems want to keep them for your first couple hundred thousand in income, but go back to the Clinton/Gore rates for the rest) – does not necessarily make him the best choice to shoulder more responsibility than anyone else on the planet. Unless that is, you want a third Bush term. (May Day! May Day!) But what of his economics? Most recently, he proposed waiving the federal gasoline tax this summer, which has been greeted by economists almost universally as trivial (it would reduce the cost of gas barely 5%), wrong-headed (cut a tax dedicated to repairing our deteriorating infrastructure?), symbolically inappropriate (what’s next? should we start subsidizing gasoline to encourage people to drive bigger cars?), and quite possibly counterproductive (if on the margin people are encouraged to do a bit more discretionary driving than they otherwise would have, that would increase demand for gasoline, and, thus, the price). Yes, one of McCain’s opponents chose not to be outbid for motorists’ affection. (It’s like an arms race – unilateral disarmament is risky.) But I console myself with the thought that it wasn’t her idea – and that she at least signaled the irresponsibility of it all by proposing to pay for it, by shifting the cost to the oil companies. As to other economic matters, did you see Senator McCain on ABC’S ‘This Week with George Stephanopoulos’ a couple of Sundays ago? STEPHANOPOULOS: A lot of Americans are angry right now about the economy. MCCAIN: Sure. STEPHANOPOULOS: And on Friday, you conceded that Americans are not better off than they were eight years ago, but the Democrats are launching an ad campaign this week where they’re going to try to pin some comments you made during the primary. Take a look. (BEGIN VIDEO CLIP) MCCAIN: I think you could argue that Americans overall are better off because we have had a pretty good, prosperous time, with low unemployment, low inflation. A lot of good things have happened, a lot of jobs have been created. I think we are better off overall. (END VIDEO CLIP) STEPHANOPOULOS: The theme is going to be, and you know it, you’re out of touch, you just don’t get it. How do you respond? MCCAIN: Well, I have an economic plan. It’s good. It’s strong. Things have gotten worse in the last several months, as we all know, in our economy. Americans are struggling. American families are sitting around the kitchen table today trying to figure out how they’re going to keep their home, keep their job. Times are very, very tough. And the worst thing you can do, the worst thing you can do is raise taxes. Both Senator Clinton and Senator Obama want to raise taxes. That’s out of touch. That’s out of touch. [Not on 95% of the people! Only on that portion of your income exceeding $200,000 or so! – A.T.] Senator Obama says that he doesn’t want to raise taxes on anybody over – making over $200,000 a year, yet he wants to nearly double the capital gains tax. Nearly double it, which 100 million Americans have investments in – mutual funds, 401(k)s – policemen, firemen, nurses. He wants to increase their taxes. [Putting the long-term capital gains rate back at the Clinton-Gore 20% would raise it by a third, not double it. And not one dime of the money nurses, et al, have in 401(k)s (or IRAs) is subject to capital gains tax. So the ‘100 million’ number is wildly exaggerated. Even INCLUDING retirement funds, the median family’s stock holdings are only about $25,000. For them, the annual capital gains distribution from a mutual fund would rarely exceed a couple of thousand dollars, on which the difference between a 15% rate and a 20% rate might be $50 or $100. And even that burden could be easily brushed aside – it would be most Democratic to exempt, say, the first $10,000 a year of gains from the higher rate. But what about the $500,000 gains and the $25 million gains? Would it hurt policemen, firemen, and nurses to see the rate on those gains go back to 20%? It’s the Republicans who are always trying to keep from raising the minimum wage while lowering the tax on billionaires. The Democrats who are always sensitive to the difficulties faced by the working poor and the middle class. (Did you notice that CEO pay – which was about 40 times as great as the pay of the CEO’s employees in 1980 – is now 433 times as great? AND these guys got huge tax cuts. All hail the Republican plutocracy! These are nice people and we wish them well. No one begrudges John and Cindy McCain their Citation Excel. But c’mon, Senator – get real.) – A.T.] MCCAIN: And he obviously doesn’t understand the economy, because history shows every time you have cut capital gains taxes, revenues have increased, going back to Jack Kennedy. . . . [So if we lower the capital gains tax rate to zero, revenues will go through the roof? Again, get real! Economists can debate all day just where the breakeven lies – it depends on so many things, including people’s expectations of possible future changes to the rate that would induce them to take gains or hold off. But clearly, you can’t keep lowering and lowering tax rates and expect revenues to keep rising. And the same is true of the tax on ordinary income. This makes me so nuts. Of course revenues went up when Kennedy cut the top tax rate from Eisenhower’s 90% to 70%, where it remained, still wildly too high, until Reagan cut it to 50% in his first term, STILL way too high, and then to 28% – which, experience showed, overshot, as deficits grew frighteningly large. Just 30% of GDP when Reagan took office, our aggregate National Debt will be around 70% of GDP when Bush leaves. This is a $10 trillion debt burden – 85% of it accumulated by Republican administrations – on the shoulders of our children and grandchildren. Clinton moved the top bracket on ordinary income back up to 39.6% and by the end of his Administration had the budget balanced. Experience showed that THAT rate, coupled with his 20% capital gains rate, was more or less ‘just right’ (to put it in porridge terms). But then Bush went back to cutting taxes, mainly on the rich, and ballooning the debt, weakening the dollar, and all the rest.- A.T.] We’re going to cut taxes. We’re going to reduce spending. We’re going to put a freeze on discretionary spending. We’re going to make wealthy people pay for their own prescription drugs. We’re going to scrub every institution of government and put them out of business. [That’s what Reagan and Bush said – they’d cut taxes (which they did, mainly for the rich) and cut out the waste in government, which they didn’t. My sense is that the Al Gore-led Reinventing Government effort was far more effective at getting us more for our taxpayer buck than the ‘heck of a job’ the Republicans have done. The difference, some say, is that Democrats believe in government and want to make it work. Republicans almost seem to want to prove that it can’t. Obviously, we Dems have not always done a good job – and not every Republican-led agency has failed to do a good job. And obviously, there are lots of things government should NOT try to do. But I think a lot of Democrats get that; and certainly have vocal guidance from our friends across the aisle if and when we forget. – A.T.] ☞ There’s much more to the interview, which you can watch in its entirety. But the big thing is that, like Reagan and Bush, he will cut taxes and balance the budget by cutting waste – which somehow they never managed to do. If only we had a Harvard MBA in there – he could do it. (Oh, wait. Sorry.) I’m not pooh-poohing the desirability of cutting waste. But as Stephanopoulos points out, not every ‘earmark’ is waste – one goes for military housing, another is our aid to Israel, neither of which, the Senator was quick to point out, he planned to cut – and, in any event, the total cost of earmarks, even if you did eliminate them all, is less than 1% of the entire budget and perhaps 5% of the true deficit. (The true deficit is the one that does not ignore our borrowing from the Social Security Trust Fund.) Note, too, that with Dems back in control of Congress, earmarks have been cut sharply. McCain pledges to wring billions from wasteful military procurement programs, which would be great. But have you noticed how it always seems to be more easily said than done? He wants to freeze all nonmilitary discretionary spending (which means cutting it 5% or so a year, when adjusted for inflation and population growth). But cutting our investments in people and infrastructure may not be the best way to reinvigorate the economy, let alone get it on track for prosperous generations to come. There may be a reason the stock market has, historically, done better under Democrats than Republicans. Spread the word.