Uruguay, India, Spain: Good News, Bad News, Joy December 12, 2013 URUGUAY Becomes the first country to legalize marijuana (with sensible restrictions). Here. “Uruguay’s leftist president, Jose Mujica, defends his initiative as a bid to regulate and tax a market that already exists but is run by criminals. ‘We’ve given this market as a gift to the drug traffickers and that is more destructive socially than the drug itself, because it rots the whole of society,’ the 78-year-old former guerrilla fighter told Argentine news agency Telam.” (The same article notes that “Decriminalization of all drug possession by Portugal in 2001 is held up as a success for reducing drug violence while not increasing drug use.”) INDIA Has just recriminalized its 100 million or so LGBT citizens, pending Parliamentary review that few expect to happen any time soon. Here. In a way, you have to thank the British Empire for this (though certainly not today’s Brits) — it’s a holdover from the 19th Century throughout much of the world. SPAIN Dick Theriault: “Thank you over and over for the Mandela flash mob! Glorious, just glorious. What voices, what harmony! And in recompense, in case you’ve missed it, here is a similar uplifter: Amazing Oasis: Best coin ever spent. Have a wonderful holiday season.”
Are You As Smart As Jeff? Is Glenn Going To Quadruple Our Money? Did I Invent The Forever Stamp? December 11, 2013December 29, 2016 13% TAX FREE This is stupid and trivial, but — because I may have invented the Forever Stamp (though presumably not) (though I did get to pitch it to a Postmaster General one New Year’s Eve, so you never know) — I’ll tell you anyway: January 26, first class postage jumps to 49 cents. If you’re not already swimming in Forever Stamps — and if you ever actually use stamps anymore — buy at least a year’s supply at 46 cents while you can. You save 6.5% off the new price; but if you use them evenly throughout the year, your blended average holding period is just half a year, so you’re earning the equivalent of about 13% a year on your $46 (if you were to buy 100 stamps). If you use stamps primarily in December, to send out holiday cards, that would give you a much longer holding period and drag the annualized rate of return back down toward 6.5%. Lower still, likely, if you buy more than a year’s worth. But there’s really no harm in buying too many. Apart from the convenience of never running out, you will always “earn” — tax-free — at least the rate of postal inflation. Which could well exceed the general inflation rate, as the costs of delivering mail come to be spread over relatively fewer and fewer envelopes . . . and as the $15 cost of a FedEx still leaves the USPS quite a bit of room to raise prices before the budget-minded would jump ship. JEFF IS ONE SMART COOKIE Jeff Cox: “You seem to miss almost nothing that comes from the web (the Danish speed control bikini bandits would still be my favorite), so you probably have seen this ‘ignorance test’ but just in case. The gist is that people don’t know anything about the world. However, just for the record, though the accompanying story says no American respondent scored better than eight of ten right, I did. I scored nine, and I should have figured out the other one, too. I’m guessing my lack of ignorance probably comes from reading your column.” ☞ Well apparently not, because I scored only 8. Though — like you — I really would have scored 9 — and, actually, 10 — if I had tried thinking a little harder. I gotta start doing that. SO IS GLENN Let’s just hope he is right about SIGA. (He thinks it’s worth quadruple or more the current price — and makes a case for buying shares of its nemesis as well.) # MANDELA Is it possible to watch this flash mob without tearing up? (Asks the guy who bawled pretty much nonstop through “Invictus.”)
Hard At Work For Failure December 10, 2013 A CONSERVATIVE VIEW OF CONGRESS This comes from The American Conservative, published the time of the government shutdown. I’m only just seeing it now. It concludes: . . . I cannot believe I’m saying this, but I hope the House flips to the Democrats in 2014, so we can be rid of these nuts. Let Ted Cruz sit in the Senate stewing in his precious bodily fluids, and let Washington get back to the business of governing. MISSOURI AND TEXAS Our Republican friends are so keen on preventing people from getting affordable health care — it is just so deeply important to them that Romneycare, a success in Massachusetts, fail everywhere else — that they not only shut down the government a couple of months ago (see above), they also now are working to make it a crime to help your neighbor find a good plan. From Rachel Maddow last week (if pressed for time, just read the bolded parts): MADDOW: Earlier this fall, a group funded by the Koch brothers specifically to target college students and young people launched these ads to try to convince young people to not sign up for health insurance. The pitch was that signing for health insurance is creepy. It’s like having a guy with a big paper mache pop head perform your prostate exam. Don’t get health insurance, young people, it’s gross. The Koch brothers’ idea here was that young people should opt out of the health insurance, and if you wrote to their opt out of insurance Web site, they would send you an opt out of health insurance kit for your college with stickers and beer koozies and stuff so can give them to your friends to let them know that getting health insurance is just not cool. Around the same time, another conservative group linked to the same billionaire conservative brothers launched this Web site in Alaska to convince people in that state that they also should not get health insurance. They actually launched two Web sites at once, one of which just flat out told Alaskan that they should pledge to not get insurance. And the other sort of tried to look more like a neutral site where you might go to get answers about health insurance, but it ended up giving the same advice, don’t do it under any circumstance. Yesterday, “The L.A. Times” reported on the same kind of trick being played in California. In California, though, it’s not some random conservative group funded by the Koch brothers that’s doing it. In California, it’s the state Republican Party. California Republicans are a little bit of an endangered species right now, but when they learned that the health insurance Web site for people to sign up for insurance in California was going to be called CoveringCA.com, as in Covering CA as in Covering California, the Republican Party in the state came up with a dummy Web site that looked just like the real one. Instead of CoveringCalifornia.com, their rip-off version was coveringcaliforniahealthcare.com. If you ended up there accidentally, it kind of looked like you were in the right place to sign up for health insurance. But you were not at that right place. You, in fact, were at the Republican Party’s Web site that was designed to make you think that health reform is terrible and in no way should you ever think about signing up for health insurance because of health reform’s terrible, terribleness. The conversation in Washington about health reform is sort of an esoteric one now. Republican House Speaker John Boehner was asked whether the Republican Party would ever have its own health care policy, its own policy ideas on the subject. His answer was, “We’ll see.” No rush, we’ll see. Today in the Republican-controlled House, there were four, count them, four separate hearings on how terrible health reform is, but with no more votes to repeal it scheduled, with no more plans to shut down the government to try to stop health reform and proper Republican alternatives to replace health reform, the Republicans’ whole approach to this issue in Washington has gotten a little esoteric, where it is not esoteric is in the states, and the states really get no attention from the beltway press in terms of their political importance. But that is where you can see much more clearly than in Washington what the real fight is right now between the parties over this issue. And the real fight now between the parties is that one party really wants you to get health insurance. They’re saying it at every turn, the president is going to do an event every day between now and Christmas Eve saying, hey, go get health insurance. One party really wants you to really get health insurance, and another party is proving that they will do almost anything possible to stop you from getting more health insurance. Nowhere is that more clear that in Texas, which, of course, is under complete Republican control and which has more uninsured people than anywhere else in the entire country. Today in Texas, they unveiled 64 pages of new state rules and regulations that restrict people who want to help other people in Texas sign up for health insurance. So, if you want to be a health care navigator in Texas to help people sign up for insurance, as of today, Texas says you must be fingerprinted. You must pass a detailed background check. You have to display evidence of financial responsibility. They will put you through 40 hours of training. And after that, after all that, you will still be banned by law in Texas from actually offering people advice about how to get health insurance. The new Texas rules they unveiled today say that nobody in Texas may recommend to anyone else that they sign up for health insurance plan. Doing that is illegal. You also cannot tell anybody in Texas the differences between the various plans that are being offered to them. You can’t explain the differences between the plans. So if you want to help people sign up for health insurance in Texas, effectively, that is now illegal. And in Missouri, it is outright illegal. Missouri is being taken to federal court right now over their efforts to make it basically impossible for people to figure out how to get health insurance in that state. Because the law that Missouri passed flat out makes it illegal for anybody to offer anyone any advice concerning benefits, terms or features of any health insurance plan. You can’t talk about that in Missouri. So, sure, millions of people across the country who could not get health insurance before now should be able to get it because of health reform. But Republican-controlled state governments are making it illegal, or at least hopefully impossible for you to find out that there are health insurance options out there that you might like. And conservative groups across the country are trying to convince you that health insurance itself is just a terrible, terrible idea. And you don’t want it anyway. It’s clear that Republicans did not want the health reform to pass in the first place. They didn’t want President Obama and the Democrats to have a legislative win. They didn’t like the policy itself. But now the policy itself is in effect. And it means that millions of Americans now can get health insurance who could not get it in the past and millions of Americans who did have health insurance before should now have better and in most cases, more affordable choices for their coverage. And all the talking about it in Washington, if you put it aside, really, the real question is whether this much more under the radar political effort in the states can effectively stop Americans from getting insurance that they might really like if only they knew how to get it. Joining us now is Michael Smerconish. He’s a radio host on Sirius XM. He’s an MSNBC contributor. Michael spent eight weeks trying unsuccessfully to find insurance options for himself and his family through healthcare.gov, before it finally worked this week. Michael, it’s great to see you. Thanks for being here MICHAEL SMERCONISH, MSNBC CONTRIBUTOR: Thank you, Rachel, for having me. MADDOW: So you had a miserable eight weeks, early experience trying to get through the federal exchange. But now, it has worked for you, is that right? SMERCONISH: It is. I had Eureka moment yesterday. And what broke the log jam for me was a new feature on the Web site that allowed me to withdraw my prior applications. This time, I used a brand-new e-mail, frankly an e-mail address that I obtained just for this purpose, because the system wouldn’t allow me. I made so many efforts I think the system thought I was somehow a fraud, to which I responded if a crook spent that much time trying to impersonate me, he deserves my health insurance. MADDOW: You know, the exact same thing happened to me on PayPal the other day. I spent so long trying to get back in to my old PayPal account, that ultimately, I was ready to arrest myself, I seemed so suspicious. I know you were a Republican until a few years ago. You and I talked about lots of policy issues like this over the years. What is your take on Republican state governments and these conservative groups that are telling people, don’t get health insurance that are trying to make it impossible for people to find out about their options? What do you make of that politically and practically? SMERCONISH: Well, now that I’m in, I have 24 different plans that are competing for my business. So I’ve got tremendous choice. And they range in price from a thousand dollars a month to $2,000 a month. And the deductible is what fluctuates in the balance, but I get it now why this was an idea that grew out of the Heritage Foundation, because it’s an antithesis of socialism. I laughed when I hear that charge because it’s either Independence Blue Cross or it’s Aetna. These are private insurers competing for my business, so that I can then go into the marketplace and still select my physician. I completely understand how this is in sync with free market capitalism. So, the Republicans now, you know, abandoning an idea that was originally their own is purely for political purposes. And I think that what illustrates this so clearly is what you just described. These advocacy efforts to say don’t get insurance, that is so antithetical to the idea, the Republican idea of personal responsibility. I mean, what we really need to ask ourselves is, who will pay for those who don’t get insurance or who are allowed to maintain an under- insured policy. Well, society is going to pay. And that was part of the premise at the outset, we wanted to cover people, right? But we also wanted to make sure that those who had coverage were not caring for those who used the E.R. as a primary care facility. So what they’re doing now is so out of whack, dare I say with basic conservatism, that I think it exposes their true hand. . . . I have a very bright and dear friend who reads this page (yes, Peter — I’m talking about YOU!) who assured me the other day he thought Obamacare was a disaster and that it was actually the Democrats who shut down the government this past fall. That is how powerful Fox News and the Republican religion is. In my view, it’s incredibly destructive, whether on health care or in keeping us from modernizing our crumbling infrastructure or in dealing more aggressively with climate change or in giving the working poor a larger piece of the pie* or passing comprehensive immigration reform — all of which would boost our economy and compellingly improve our collective future (including, ironically, that of the ultra-rich). *With, thus, more purchasing power to boost the economy and less need for food stamps that adds to our debt. Henry Ford got that he should pay his workers enough so they could buy what they made; why are today’s Republicans so sure only lowering taxes on the rich can boost the economy? They’re wrong, of course, as Nick Hanauer makes so clear.
Your China Thoughts; Some Health Care Facts December 9, 2013 HEALTH CARE FACTS FOX HAS NOT STRESSED 129 million of us have a pre-existing condition and will no longer have to worry about losing or being unable to afford coverage 105 million Americans are paying less for preventive care 105 million Americans no longer have to fear lifetime limits on care 1 in 5 were denied coverage in the old individual market Health care costs are increasing at the slowest rate in 50 years 3.1 million young adults have been able to stay on their parents’ plans because they’re not yet 26 Pediatric care for your kids is covered, including vision and dental care Over 4 million Americans will gain coverage by 2016 in states that have expanded Medicaid coverage (out of 10 million who could if all states accepted federal Medicaid expansion funds) Any emergency room visits are covered Prescriptions are covered 8.5 million Americans are receiving money back because the law requires insurers to spend money on care, not profits 6.6 million seniors save $1000 a year on prescription drugs If you develop a chronic condition like asthma or diabetes — you’re covered YOUR CHINA THOUGHTS Ellen Peterson: “I was struck by your comments to a Chinese audience re the iPhone. I am sure you know that it was designed in the US by highly paid folks, then shipped over to Foxconn for production. The workers at Foxconn, prone to suicide due to their dire working conditions, were not part of your audience. To thank the privileged members of your audience for the iPhone is disingenuous at best. You chose to ignore the terrible situation of the workers at Foxconn and the equally awful result for American workers when all production jobs are shipped overseas to the cheapest possible labor pool available for corporate exploitation. Also, you failed to take a moment to mention Apple’s tax strategy, which holds billions overseas, contributing virtually zero to the country that protects its patents and intellectual property rights. And China’s destruction of Tibet and now the Uighurs is not encouraging. I regret to say that your text to your audience read more as pandering, than clear, honest speech.” Dana Dlott: “I was in Japan last February visiting colleagues in Kyushu, which is about 300 miles due East of Shanghai. The pollution was so bad that authorities told everybody to stay in their homes for a couple of days. It’s too bad the Chinese are poisoning themselves, but it’s outrageous that they are poisoning their neighbors. I want you to imagine if there was a country a couple of hundred miles from Manhattan sending so much airborne junk in the air that everybody had to stay indoors.” Noah Stern: “I have several Chinese coworkers and one of them, Steven (Yuquing) Wu is the best computer scientist I have ever worked with. I was so impressed by his abilities that I undertook a study of Mandarin and can speak a smattering. I also dug back into my Chinese history books and read up on China some more. A couple of books I recommend: Lords of the Rim by Sterling Seagrave (I cannot recommend this book enough). Outlaws of the Marsh (my favorite Chinese classic and the young boys in your network of family/friends will love it and you may too). Wu Da and Song Jiang are my favorite characters. Also: The USChinareport website contains news related to China and Chinese/US relations.” Andrew L.: “Having just returned from 3rd multi-week trip to China, I enjoyed your posts. (1) The too many banquets was a problem the first trip, as was the amount of alcohol and the smoking. Bring a note from your doctor saying you have asthma or breathing problems. Use jet lag/tiredness as an excuse not to constantly drink. You will need to drink some to avoid being being rude. I used the same excuse to say that I would rather be alert and work then be excessively ‘banquetted.’ This is possible with a regular working relationship but probably not while you are still the ‘honored guest.’ . . . (2) The contrast in infrastructure between India and China is striking. The characteristic of India is chaos. You need to enjoy chaos to enjoy an Indian city. Major Chinese cities have spectacular infrastructure. . . . “(3) I try not to inhale. I got lucky on this trip as I seemed to just miss the bad air. [I tried wearing a face mask but felt uncomfortable — and ridiculous. — A.T.] . . . (4) The “jing” suffix means capital city- Beijing, Nanjing, etc. . . . (5) Although I am not generally exposed to it, in 1-1 conversations, everyone spoke about the corruption. I was told that my (relatively small) payment would be held up as there had been arrests in the financial office due to corruption relating to construction projects. . . . “(6) I work in the area of vaccines, helping companies in India and China make affordable pediatric vaccines. In China, I work with a State owned biological institute. I am very unimpressed with the work ethic. I joke about the magic trick they do — at 5pm everyone vanishes. This is not normal in science companies. In discussions. I learned it is very hard to motivate — the director can’t fire anyone, promote or demote. Neither can he use career development or pay as an incentive. I was told private companies pay much better but work employees extremely hard. So the State institute ends up mostly with employees who will trade security for lower pay and end up with non-motivated employees. . . . “(7) I like working with scientists in China. Despite the general motivation problems, there are enough who are keen to learn and grow. . . . (8) I was told of ethical and quality issues in private industry. Given they are making vaccines for infants, this is a big concern. I learned of vaccines being approved based on ‘relationships.’ There is always pressure to get a product out the door. In the West, laws, ethics & the FDA provide a check. . . . (9) In my experience, Intellectual Property issues are a big issue for Chinese vaccine makers. I know of at least one Pfizer patent that has wreaked havoc. I was surprised it was awarded, as I did not consider it novel. Evidently a number of companies were surprised as well because they had to change their approach and start over.”
China IV – Thank You For Making My iPhone, By The Way December 6, 2013December 11, 2013 “It is an honor to be with you this morning,” I began. (How else could one have begun, facing Communist Party officials across an enormous table in a spectacular meeting room of the Party headquarters?) It was the first formal meeting of our trip, Dialogue Session I, and I had been tasked with speaking to the topic China and U.S. Political Parties: Innovating Policies in the Face of Domestic Challenges. (Like, say, the filibuster?) I took a slightly circuitous route. “When I was born,” I said, “there were 2.5 billion people on this planet — today, 7.1 billion — China was a poor country, and there was no television . . . let alone these magic devices that put all the world’s knowledge and symphony orchestras in your pocket at the same time as they take pictures, play games, keep your calendar, show movies — and even make phone calls. [I held up my phone and paused for interpreter.] “Thank you for making my iPhone, by the way. [Approving chuckles.] “The next few decades promise even more amazing change and progress – the American futurist Ray Kurzweil says the next 50 years will bring 32 times the technological progress as the last 50 years — and as you surely know as well as I, along with great opportunity so much technological progress poses enormous challenges. The next few decades will determine whether we, as a species, attain spectacular, sustainable prosperity . . . or go hurtling off the rails. “No two countries will have more of an impact on determining which way things go than the U.S. and China, in my view, and so it is truly a great privilege to be included in this visit and to pay my respects to you this morning. “When I was a boy, maybe six or seven years old, I remember going into my mother’s room in New York – ‘Go away!’ she whispered urgently, ‘I’m on LONG DISTANCE! I’m talking to BOSTON!’ “Today, of course, we can make a call from New York all the way to China, let alone Boston — indeed, a video call — virtually free. Not completely free but — once the infrastructure is in place, and with Skype — virtually free. “In 20 or 30 or 50 years, clean energy will be virtually free as well – not completely free, but virtually free – which means aluminum will be virtually free and, well, the potential prosperity is astounding . . . “IF we can get from here to there without rendering the planet uninhabitable . . . “And IF we can figure out ways to spread the good fortune . . . “Which is really what some of the political differences in the U.S. these days are about. “Should everyone have access to affordable health care? One party says yes, one party says no. Should there be a minimum wage — and should it be higher? One party says yes, one party says no. Should half of a billionaire’s wealth be paid in tax when he or she dies? One party says yes, one party says no. Should we put our unemployed construction workers to work modernizing our crumbling infrastructure? One party says yes, one party says no. “And as I’m sure you know, the two parties have become so polarized that it’s become very difficult to reach compromises as we used to. “Innovating Policies in the Face of Domestic Challenges,” our topic this morning, has been — a challenge. “A lot of my Harvard business school friends — who tend to be moderate Republicans or libertarians — say both parties, they think, have gone off the deep end and are equally to blame for the disastrous polarization and dysfunction of Congress. But in my view – and saying this with respect and fondness for my Republican colleagues here today [I patted the RNC treasurer on the shoulder warmly as I said this, explaining that we’ve been friends since college] — that’s actually not true. “Here’s why – in three parts: “Part One: Quite a few moderate Republicans have been voted out of office in primaries for being too moderate and willing to compromise. Replaced by people very far to the right. The equivalent is not true on the left. Democrats haven’t been kicking our moderates out for not being liberal enough. “Part Two: A great many Republican incumbents, while they have not yet been voted out in primaries, are afraid they will be, so THEY, too, have become far less likely to compromise. Again, the equivalent is simply not true on the Democratic side. Very few if any Democratic senators or representatives live in fear of being ‘primaried.’ That could change; but it may not — because: “Part Three: There is a reason for all this. There are billionaires on the right who stand ready to fund these primary battles — which, win or lose, really get the attention of any remaining Republican moderates. The equivalent is simply not true on the Democratic side. Yes, we have our billionaires. But few if any are ‘far left’ in their policy positions — no Karl Marx Democrats to balance the Republican followers of author Ayn Rand. “In short, the constituency that would be hurt by raising taxes on investment income has billionaires eager to affect our elections . . . while the constituency hoping to raise the minimum wage has no billionaires. [I decided not to try to explain gerrymandering — not least because my guess was that most of our very well prepared hosts knew all about this stuff anyway] “So – in my view — we have a huge problem. The moderate, reasonable, problem-solving Republicans – like my friend and college classmate here [another pat on my RNC counterpart’s shoulder] — have been replaced by rigid ideologues. And this poses a huge challenge to innovating policies. “I listed some of them – reforming our health care system, investing to modernize our infrastructure. Others include what Democrats think of as sensible gun safety laws, something called the Consumer Financial Protection Bureau, and of course – of tremendous, perhaps existential significance – policy to mitigate climate change. “Democrats believe the scientific community on this issue; many Republicans, do not – including the one they chose to chair the subcommittee in Congress charged with overseeing climate change. “To fix this problem of polarization — to bring compromise back — we need to change the way we draw our voting districts, perhaps reform our campaign finance laws, and some other things, to make it easier for centrists and moderates to win election to Congress – and to make it more difficult for a single senator to bring the entire government to a halt. But it’s not easy and won’t happen overnight. “Finally, ‘a point of personal privilege,’ as we say in America. “One place our country has made considerable progress over the last five years is the area of equality for our Lesbian, Gay, Bisexual, and Transgender citizens. “Estimates vary, but you can figure that something like 5% or 10% of humanity falls into one of those categories. So maybe 20 million Americans, 100 million Chinese. “But unlike many minority populations, this one can remain very hidden. When I was growing up people like me – and [the DNC staffer accompanying me, a young woman of Indian-American descent] – would never, ever let anyone know who we really were. If you could hide it, you just had to. “I could write a book about how lonely and unhappy and unhealthy it is to live that way. In fact, I wrote two books about it. [resist the urge to hyperlink; but what would the royalties be on another 50 million copies???] But the wonderful news is that in America and much of the world, tremendous numbers of people have opened their hearts and minds to this issue. “And I know it’s happening here in China as well, and I offer you my sincere admiration for that. [China decriminalized homosexuality in 1997, removed it from the list of mental disorders in 2001, and just this past August sanctioned the second China LGBT Community Leader Conference here in Beijing.] “In America, one of our 100 senators is now openly LGBT, as are 6 of our representatives in Congress. The mayor of Houston, the head of the New York City legislature, the sheriff of Dallas. Five of our ambassadors, including our newly appointed ambassador to Australia. The Democratic National Committee has nine officers. Three of us are openly gay. A former chair of the Republican Committee is openly gay. “In just the past five years, despite the gridlock I spoke of, and with the help of a very small but growing number of Republicans, we have passed several pieces of federal legislation . . . and 17 of our states now allow marriage. “It turns out to hurt no one to allow to people who love each other TO love each other. And not to pressure people to procreate with members of the opposite sex when they don’t want to. It made sense to do that in Biblical times, when tribes and nations wanted larger populations. It makes no sense now, when spaceship Earth will soon have 9 billion passengers on board. “My own partner Charles and I were together for 17 years until he died of neck cancer three years ago. I still wear my ring. And before he died, we got to dance in both Bill Clinton’s White House and then again in Barack Obama’s. “Unimaginable, when I was growing up. “Just like my iPhone. “So progress is possible, and there are forward-thinking Republicans like my friends here today with whom it would be easy and a pleasure to do business. But as I see it, they are not the ones in control of the Republican Party these days, and that poses challenges to all of us. “Thank you again for the privilege of addressing you this morning.” # I had told just one of our team — a veteran of these dialogues — what I planned to say, to see whether he thought it would be okay. He said I should give it a shot, but not to be dismayed if the response was stone-faced. He said he really didn’t know how they would respond. His guess: a polite smile but no direct response. Instead, at each of the meetings over the course of the visit, in Beijing and Nanjing, the response boiled down to: “We believe everyone should be allowed to live in dignity and to live their lives however they want so long as it doesn’t hurt anyone else.” And they seemed to mean it. From what I know, that’s not the sentiment of all 1.365 billion Chinese. But it sure beats what we hear coming out of officials in, say, Russia these days. And when you think about it, this is a good issue for our friends in China. In the first place, as an atheist state, they don’t face the deep-seated religious objections that have slowed progress here. In the second, it could help a little with their population challenges. And third, where most things they need to do to enhance the people’s well being is massively expensive . . . building cities, upgrading to clean energy . . . this thing, that impacts the happiness of perhaps 100 million Chinese . . . just treating them as valued members of society . . . costs nothing. (The same would be true, by the way, in Mississippi.)
China – III – “You Have Your Tea Party, We Have Ours” December 5, 2013 I went to China courtesy of the EastWest Institute, founded in 1980 to increase trust and cooperation in a dangerous world. It was a little embarrassing to be invited along. I had never been to China. I speak no Chinese. I am aware only of the first names (which it turns out are actually what we would call the “last names”) of a few of their leaders. It is a civilization with 5,000 years of history, of which I am all but entirely ignorant. About my only real connection to its culture is an enthusiasm for chopsticks. Our delegation consisted of three Democrats and three Republicans plus some astonishingly accomplished, personable staff. Among them: the Institute’s “Vice President for the Strategic Trust Building Initiative,” author of three books, fluent in Chinese and Russian, who had previously served nine years in the U.S. embassies in Beijing and Moscow . . . a former Singaporean political journalist with her masters from Columbia . . . a woman with a masters in Asian studies tasked with making my Amtrak reservations (talk about overqualified) . . . and the recently graduated Chinese-American drum major of the Yale College marching band (which is my way of sneaking in the results of this year’s game). We were embarked on the EastWest Institute’s sixth U.S.-China High-Level Political Party Leaders Dialogue, flying to Beijing on a private Boeing 737 on loan from EastWest board chairman Ross Perot, Jr. From the EastWest web site: The U.S.-China High-Level Political Party Leaders Dialogue aims to increase contact, familiarity and trust between Chinese and U.S. political elites and maintain a political backchannel that can transmit sensitive high-level messages on critical issues affecting the bilateral relationship. At the December 2012 meeting in Utah, Colorado and Washington, D.C., senior Chinese Communist Party officials and prominent Democrats and Republicans exchanged ideas and discussed prominent policy concerns, in the hopes of promoting understanding and trust between the United States and China. (Their China initiative includes, separately, exchanges to improve cybersecurity and improved military relations.) With us was the Institute’s co-founder and CEO John Mroz, “one of the six remaining liberal Republicans,” as he puts it — “a Rockefeller Republican” — and a whirlwind of positive energy. He had to grab a midnight flight to Moscow halfway through our trip, but not before I learned stuff listening to him I never even knew I didn’t know. E.g., did you know how important underseas cables are to the Internet? And how ships’ anchors, occasionally slipping from their locks, would accidentally drag harbor bottoms and sever them? (John convened a conference that led to better anchor locks.) On the Republican side, we had the grandson of a U.S. president highly regarded in China . . . and a long-time Beijing resident who brought them this U.S. Chamber of Commerce document he had co-authored, assessing ways China could participate in the more than $8 trillion of infrastructure modernization it is estimated the U.S. will have to do by 2030 (so gosh, my Republican friends, shouldn’t we get started?) . . . and my counterpart — and college classmate — the treasurer of the Republican National Committee, pictured here, who jovially put up with me the entire way. Which is saying something. On our side, we were led by a former chairman of the House Foreign Affairs Committee . . . and joined by a real estate developer who shortly after graduating from Georgia Tech, without a nickel, managed to found his own city in 1959. (Home now to 35,000 residents, it was named by BusinessWeek “Georgia’s Best Place To Raise Kids 2013.” He also co-founded the Central Eurasia Leadership Academy in Istanbul, has sponsored programs to educate young women in Afghanistan and Tajikistan, is a B-school professor, chief fundraiser for his church — and about 100 other things.) Perhaps my biggest take-aways from trip were: + We should pay attention. There are four times as many of them and their kids are really smart. (You’ve seen the latest test scores?) Yet how many of us know much about China? One of our number came home saying that he had had no idea. His thinking about China was now very different, and — if I properly caught his drift — not nearly as hostile. Despite the competitive challenge, much good can come from cooperation with a prosperous, successful China. + And yes, they know all about their pollution and carbon problems — see last week’s link to to my air quality app. But if they’ve shown anything, it’s that when they set themselves a task, odds are decent they will achieve it. (Perhaps you saw the Olympics?) So China’s progress for the next 35 years — last week’s other link — which will surely include air quality improvement and green house gas reduction, may be as dramatic as that of the past 35. It had better be: if they don’t get the carbon thing right, we’re all cooked. + How can there be billionaires in “communist” China? Whatever happened to “from each according to his ability to each according to his need?” Do they really need all those late-model BMW’s on the traffic-packed roads? What on earth would Mao — or Marx — have thought? Their basic answer is that communism remains the long-term, theoretical goal . . . but that any measures that serve to improve the lives of the country’s 1.365 billion people are stepping stones to that now very distant vision. Hence the Third Plenum’s recommendation that “market forces” be stepped up from “a fundamental factor” in allocating resources to “the decisive factor.” + One-party rule is not our desired system, obviously; and can lead to horrific things, obviously; but the Communist Party of China, with its 85 million members (just 6% of the country!), is at present, at least, mainly intent on solving problems and making lives better. And while it presents a united front to the world — certainly more so than we Democrats and Republicans do — there are differences of opinion and debates within the party. For example, just days before our trip, the Chinese military released a 100-minute video “with an ominous sound track” that (as reported here) “accuses the US of trying to undermine the Chinese Communist Party’s control of the People’s Liberation Army and impose US values on China.” Cutting from crude graphics of US dollar bills, to shots of the Statue of Liberty and blurry footage of US leaders, the video bemoans the fall of the Soviet Union and warns that China faces a similar fate if it fails to counter Washington’s nefarious efforts to infiltrate Chinese society.” We asked a high ranking Party official what we should make of this. He said, tellingly, I thought: “You have your Tea Party, we have ours.” + The country has enormous challenges — air quality and corruption and meeting the needs of 1.365 billion people prime among them — but it is astonishing what they’ve accomplished in 35 years (and to think of what they may accomplish in the next 35 if they don’t screw it up). After a couple of days in Beijing we flew to Nanjing, of which I had only barely heard. (Iris Chang s The Rape of Nanking, recounts the 1937 slaughter of more than 300,000 Chinese, many of them women and children, as well as thousands of rapes, by the invading Japanese. The memorial at Nanjing, which we got to tour, is . . . in its literal sense, stunning.) Well, there I was, in a room on the 41st floor of the Sofitel Nanjing — Nanjing has a Sofitel??? — and 41 wasn’t even the top floor, and it was as elegant a room as any I’ve ever stayed in — yet calling back to friends in the U.S., most had never even heard of Nanjing. The next day we drove out to an industrial park — one of 100’s around the country, they assured us — that housed 500,000 people, 300,000 of them students at 15 universities within the park. The scale model of the 10-square-mile park filled a ginormous atrium. “How many separate buildings are there?” I asked. They didn’t know. At least not off the top of anyone’s head. The answer, as best I could translate the body language, was . . . too many to count. Except instead of jelly beans in a jar, these were recently-constructed buildings. One of which housed the 1,000-employee Nanjing operation of a New Jersey company (with 100 employees at the home office) that provides most of the world’s genetic researchers with the genes they need for their experiments. And here’s the punchline: Nineteen years ago this entire industrial park was . . . farmland. + The people I met were really nice. I’m sure there are awful Chinese, as there are awful Americans, Slavs, and Swedes. But by and large, don’t you find, people are people? Who mostly want roughly the same things? Including respect, and the feeling that their concerns have been heard and that they’ve been treated fairly? + If we could form, in effect, a “G2” — a constructive partnership of the world’s only superpower and the world’s leading “rising power” — it could lead to a significantly more secure, prosperous world. “But,” I asked, “wouldn’t the other G countries — in the G8 and the G20 — get all jealous and, like, ‘who elected you king?'” The answer I got — at least from the experts advocating this — was that, actually, no: those other countries would welcome the cooperation and leadership. + The Chinese take democracy seriously. Again, not our form of democracy, but the stuff of a recently published book we were given — my jaw drops to find it here on Amazon, soon to be delivered through your open window by octocopter drone — The Strength of Democracy: How Will the CPC March Ahead. From the flap: Some people believe the CPC is not a party that embraces democracy. Is this true? Others believe that the people’s congress system is not really democratic and the political consultation system is a “political farce.” Is this also true? . . . This book provides vivid stories, classical cases and reliable historical evidence to respond . . . It aims to tell readers that the history of the CPC (more than 90 years) is also a history of fighting for and building democracy. I have not read this book. A certain TV drama about a meth-cooking high school chemistry teacher — the last five episodes of which I finally finished yesterday at 5:30 am — was somehow more compelling. But I think the Chinese have earned the right to be listened to and taken seriously, not so much because we would ever consider abandoning our system for theirs (nor are they suggesting we should), but because theirs may be better suited to China’s needs, at least for two or three more decades, than we commonly think. If we think about it at all. I hope to find time to read it; but perhaps one of you might and share your thoughts? + In China, 8 is a lucky number, 4 is an unlucky number, so on days when air quality is particularly bad and cars with licence plates ending in 8 can’t drive, traffic is relatively light — because so many people prefer plates with that number — while on the days when the 4’s are sidelined, it’s heavy, because relatively few people accept a licence plate ending in 4. It’s not clear to me how pronounced this effect really is; but everyone agreed that rich Chinese solve the problem by owning two cars, so one is always allowed on the road. + Boy, there were a lot of banquets. Each with a printed menu. For example: Assorted Cold Dishes Double-Boiled Wild Mushroom with Radish Pan-fried Steak with Three kinds of Dressings Braised Shrimps with Tofu Pudding Braised Dried Scallop with Melon Deep-fried chicken Wing with Assorted Delicacies Stir-fried Seasonal Vegetables Three Kinds of Colour From Chinese Style Noodle in Soup Brownie with Fruits Tomorrow: Resisting The Temptation To Pitch Them On Borealis
ETRM and Butt Kick December 4, 2013March 6, 2014 In February, I suggested ETRM at 90 cents as “a new speculation” . . . ETRM was $4 when its minimally invasive but surgically implanted weight-loss device was pending approval from the FDA. Presumably, people were hoping the data would be good, the device would be approved, and the stock would rise. Instead, the trial missed its primary end point and the stock crashed immediately to $1.30, drifted down to $1.12 in the ensuing week or two, and then dropped finally (or perhaps not finally, which is the risk) to close Friday at 90 cents. That might normally be the end of the story, but as I understand it — distilled from smart people who actually DO understand it — the company may submit their data anyway, and for a variety of reasons apparent to at least some FDA watchers, the FDA just might approve it. In other words, this could be a situation where the broad market sees failure but could be surprised by success, if the FDA decides that, in hindsight, the primary endpoints were set too high, and the attained results are actually “good enough.” If this were to happen — a huge IF — the stock probably goes back to $4 and perhaps a good bit higher. The company probably has the cash to see this through — the reason ETRM dropped that extra leg down late last week was announcement that cash had been raised at a price that, giving weight to the value of warrants that were attached to the deal, was in the 80-to-85-cent range. This is purely a gamble. Heads, the device is approved and we make several times our money. Tails, it’s not, and we lose it all. As I often repeat, this is for money you can truly afford to lose . . . perhaps as one of half a dozen little speculations that in the aggregate make up $30,000 of the $350,000 (say) you’ve chosen to expose to the stock market, with the rest invested via, for example, equally-weighted or fundamentally-weighted index funds. The advantage of this $30,000 carve-out being, first, that you get to control the taxes, which means you can come out ahead even if you just break even: selling your losers to lower your income tax; using your winners, once held for a year and a day, to fund your charitable giving via the Fidelity, Vanguard, or Schwab charitable gift funds. And the second advantage being that, who knows? We could get lucky and do better than break even (or unlucky, and do worse). So yesterday the stock jumped 63% to $2.24 — up 148% since February — on news of strong new test data. Writes Guru: “Anything could happen, but I don’t see how this doesn’t eventually get approved.” Not tomorrow, but sometime next year. He sees a solid case, if approved, for ETRM shares to hit $5 well before any actual profits roll in (if they ever do) as people get excited by the prospects. Or higher, if those prospects capture the market’s imagination, because . . . “The number of potential patients is enormous. At least 1.5 million Americans have a Body Mass Index of 50 (and another 8 million or so between 40 and 50). If this were worth what ARNA is, with its drug that produces just a 3% body weight loss that disappears after 12 months — yesterday ETRM said their weight loss remains at 10% after 18 months — you could get to $20 a share.” I am counting none of those chickens; but as a guy who tries to eat nothing but an avocado and a carrot each day (yet just downed a pint of Emack & Bolio’s coffee oreo low-fat yogurt), I would like to point out that a 10% weight loss is not nothing. The goal is not 100%, after all. Just going from 200 pounds to 180, while not the stuff of astonishing before-and-after pictures, is meaningful. If ETRM ever gets back up toward $4, it would not be crazy to sell enough to recoup one’s original bet and then, with the rest, just see where it goes from there. BKUTK Fred Campbell: “Thank you for talking about a stock today and not being on your political soapbox. It may be a stretch to ask you to spend two days in one week talking about personal finance but I ask that you provide an update on Bank of Utica. Mainly, what is the endgame we’re looking for? Generally, when you recommend a stock you’ll provide an endgame such as FDA approval, Wheeltug acceptance, or awaiting a court ruling. But I’ve heard nothing on BKUTK except that it’s a buy. Any info is appreciated.” BKUTK — or “Butt Kick,” as it is known affectionately by at least two of its shareholders — could hardly be more different from ETRM or many of the others I suggest. This one, as described by Chris Brown at the time, was all about stodgy undervaluation. Trading then at $330 and now at $425, with about 3% a year in dividends along the way, it’s done just fine. But there is no expected event-driven endgame we are looking for – just a chance to hold on, collecting dividends, as (we hope) it grows and/or approaches full value, which Chris thinks exceeds $600. I haven’t bought more at $425, but I’m not selling. A TASTE OF CHINA It was just one banquet after another. More to follow.
Bridegroom December 3, 2013December 3, 2013 His name was Tom Bridegroom. For real! His life and love make for one of the most beautiful movies ever: “Bridegroom.” Watch it free on Netflix even if you don’t have a Netflix account. (Why would you not have a NetFlix account?) As one viewer-reviewer wrote: I’m a straight male (I would totally hook up with the deaf girl…sorry, she’s hot), and I’m glad I watched this alone, because it really got a few tears out of my eyes. I’m glad I live in the the great and progressive state of California. I’m glad gay marriage is slowly being accepted in other states as well. Great movie, HIGHLY RECOMMEND IT. Meanwhile, I finally came to the end of Season Five of Breaking Bad. All “free” on Netflix if you don’t count the $7.95 monthly membership — or the 50 hours spent to watch this guilty pleasure. I am deeply ashamed. And was at first surprised by the way the series ended. But then decided . . . hunh. Interesting! A very light touch. Wow. Hadn’t expected that kind of ending. Artistic. And then Wikipedia (I think it was) explained to me that, yes, the show ran for five seasons, but the final season was broken into two parts — “Season Five,” which I had just completed, and “The Final Season,” which is not yet free on Netflix, though all-but-free here on Amazon Instant Video. I am now even more deeply ashamed; but China will just have to wait. Watch “Bridegroom.”
If I Had Told You . . . December 2, 2013December 11, 2013 If I had told you five years ago we would avert depression, rescue Detroit, stabilize the housing market, double the Dow, achieve energy independence, end two wars, avoid two others, kill bin Laden, destroy Syria’s chemical weapons, degrade Iran’s nuclear capability, achieve LGBT equality, sell Plan B over the counter, triple the female representation on the Supreme Court, provide universally affordable health insurance, double the energy efficiency of our cars, grow private sector employment 44 straight months, slash the deficit, bring National Debt growth back into line with GDP growth, and sit with a majority in Congress ready to pass Comprehensive Immigration Reform . . . . . . you might well have said, “Dream on.” Yet of course, with some important caveats, that’s exactly what we’ve done. Sure, the fuel efficiency of our cars hasn’t doubled yet. But it’s headed that way. Sure, we are only in the early stages of destroying Syria’s weapons and degrading Iran’s. But it’s begun. Sure, the health insurance roll-out makes news solely for its problems, gleefully exaggerated and exacerbated by its critics. But the problems will be solved — and apply to vastly fewer people than do the benefits. Most will be paying the same as or less than they otherwise would have, often for better coverage; all will be assured availability of affordable coverage regardless of whatever health problems they have now or might develop. (These added benefits aren’t magic; they’re paid for in meaningful part by higher tax rates on investment income — albeit not as high as those rates were when Ronald Reagan left office.) Sure, we haven’t entirely achieved LGBT equality. But the last major piece of the federal legislative puzzle – the Employment Non-Discrimination Act – is now favored by a wide majority of the public, has been passed by a wide majority in the Senate, and would be signed into law tomorrow if only the House Republicans would allow it to come up for a vote. Same with comprehensive immigration reform: favored by a wide majority of the public and the Senate, it would be signed into law tomorrow if only the House Republicans would allow it to come up for a vote. So as the year winds down and we begin to look forward to 2014 and beyond, please take heart: despite unprecedented obstruction, we’ve made enormous progress. And if we should happen to elect a Democratic Congress in 2014 — which would mean the House could actually vote on things that a majority of its members favor — we could make a lot more. # Still composing China thoughts. Have you read about the reforms of the Third Plenum?
The Circus Is Over – Updated November 30, 2013December 2, 2013 Shortly after assuming the papacy — or perhaps as he was headed to the swearing in — the Pope was given a tour. A Vatican steward opened the double doors of an enormous closet and gestured grandly to show his Holiness the raiments he would wear for the various holidays and occasions. To which the Pope allegedly responded: “Close it up. Take it away. The circus is over.” It’s not clear whether any of this actually happened. It may be apocryphal. But — as the conservative Catholic columnist friend who related it to me over Thanksgiving dinner and I agreed — it really doesn’t matter. It’s true even if it didn’t happen. This columnist and I agree on very little else, but we agree on this much: we love Pope Francis. And everyone else at the table agreed. A Pope who truly gets Christ’s teachings! # One of the many things the columnist and I don’t agree on: Medicaid expansion. My guess is that the Pope would come down on the side of the governors who are accepting Federal money to cover more low income people. Likewise, that his Holiness would bridle at cutting food stamps for the hungry. My conservative Catholic columnist friend, a vocal Republican . . . even while characterizing this Pope and all his recent predecessors as “socialists” . . . could not take that leap. “Who can say where Pope Francis would, or Jesus would have, come out on these questions?” My own view: any idiot can say. But what do I know? Religion and ideology both run deep, and seem to co-exist in happy self-contradiction when faith in both is strong enough. # UPDATE: The Pope actually gives us a few more clues as to his thinking in this, his just-released, 224-page First Apostolic Exhortation. As summarized here. The official Vatican translation includes, for example: 54. In this context, some people continue to defend trickle-down theories which assume that economic growth, encouraged by a free market, will inevitably succeed in bringing about greater justice and inclusiveness in the world. This opinion, which has never been confirmed by the facts, expresses a crude and naïve trust in the goodness of those wielding economic power . . . This is not to say the Pope — or Jesus — should have the last word on economic policy. But in light of this 224-page treatise, I do think it’s hard to argue that “we can’t know” where the Pope (or, as I read the Bible, Jesus) would come down on expanding Medicaid or cutting food stamps — or, for that matter, raising the minimum wage, making it harder for the poor to vote, zeroing out the estate tax on billionheirs, and all the rest of it. I mean: Seriously?