Search This Blog

Friday, December 2, 2011

Allen Gregory, the Most Homophobic Show on TV

Let me begin by saying: I like South Park, Family Guy, and the Simpsons.  All of which have had their fair share of homophobic jokes.  Men's relationship to our own sexuality is anything but healthy.  From the time we're children we're teasing each other or beating up on each other about being strong, being masculine--the worst thing you can be as a young boy, is skinny, fat, or effeminate.  I was more a victim of this than I'd like to admit.  I don't think I was ever called a F**, but my masculinity was consistently challenged by other boys.  In spite of this, or perhaps because of it, I still enjoy some crude humor--I survived it--I feel like I've earned it.  The fact is: there are a lot of unfortunate stereotypes about gays, and humor is often based on such stereotyping.  But Jonah Hill, whom I know nothing about, has created a story that actually portrays horrible, truly horrible gay stereotypes.  The type that the Religious Right has been forcing down our throats for years.

Look.  Gays themselves promote certain stereotypes.  Look at Project Runway.  But even those stereotypes are just as incorrect as stereotypes about rape.  But they're tolerated, and even in a "fabulous" city like New York, it's rare to see an openly homosexual man who doesn't adhere to some stereotypes.  Maybe its about fitting in--I don't know.
Let's get to the facts.  Allen Gregory is a seven year old child who has been homeschooled by a rich gay couple.  The rich couple is falling on hard times because of the recession, and because of that, this incredibly precocious child is forced to go to public school.  That's fine, and actually funny.  Who doesn't love to see the rich snob snubbed by the cold hard reality of normal life?  That's fine, though implausible, AG's tutor is one of his fathers, not some high-priced private tutor.  Not to mention, given the level of wealth exhibited by the TV show, I'd say its also implausible because Allen Gregory is one of the 1%--so they're fine.  Only middle class kids are dropping out of expensive private tutoring.
That's where all semblance of okayness ends. 

1)  Allen Gregory's flaming father shamelessly abuses his other "daddy" in public.  The first words out of his mouth are a public humilation of the man.  In the three episodes I've seen, this practice continues unabated.  He only ever says two nice things about the man, one of them treating him like a piece of meat, and the other...actually nice.  And the other daddy, Jeremy, is clearly shocked by this nice treatment.

So gay relationships must be abusive?  Well, ok, abuse is possible in all relationships, and certainly the film Party Monster (and the horrifying real life story) indicates that no sexualities are immune.

2) It is indicated in those first two episodes that AG's father may well have forced Jeremy to become a homosexual.  Jeremy confesses to AG that his father was unrelenting in his pursuit of Jeremy, even when he was straight, happily married and at the top of his career.  Jeremy admits that Rich ignored restraining orders and publicly stalked him

Ok, maybe he was gay, right?  That's plausible, maybe the wife was a beard.  That happens right?
Except no, its not ok.  A predominant homphobic meme is the fear that gays can "turn" straight men.  You used to see it on TV all the time when gays were first openly portrayed on television.  The conversation might go like this:  Straight man sitting on couch, finds out that his best friend next to him is gay.  "You're not going to hit on me are you?" "No, you're not my type." Ha. Ha.  It's still homophobic.  It indicates that a straight man has something to fear from a gay person. 

3)  By the end of the second episode it has become more and more clear that Jeremy's "life partner" Rich, has been raping him every time they have sex.  When Allen Gregory wants to make a sex tape of him and the principal, and he describes his vision to his manservant.  "I think it should just be regular sex, you know with one person running away and saying, 'No, I don't feel like it' and the other person should completely ignore that and say something like 'Come on Jeremy, just go with it.' Somebody should give him a slap, and than somone should put up their hands to god and say, 'oh god, what has my life become?' And then we should just wrap it up with a little crying in the bathroom."  Later on, a comment by Rich "Well you lost that argument about fitting something in" to Jeremy's rectum, leads Jeremy, in a defeated tone, to hang his head and say "yes, yes I lost that argument."

Not cool.

4)  The last awful thing in my three episodes of viewing was the episode "Gay School Dance."  This show had some promise, the chance to right some wrongs.  Instead, Rich forces the entire elementary school to bring same sex partners to the dance, and the plot of the episode turns around the adopted daughter of Rich, attempting to get the principal to fight back against him, and put the dance back to "normal."  Nevermind that Rich himself, isn't changing the dance for the benefit of a human kind or equal rights --no he threw a jealous hissy fit that his partner was more popular with the kids at school, and retaliated.

There are many other disgusting and shameful things to this TV show, but I won't bother with them.  I think this show could really have been funny, and still respectful, but someone really messed this up.  And as Jonah Hill has appended his name to this flop--I think it must be his fault.

Look, I admit that I like sassy, flaming gay characters; its a cheap stereotype, and I'm ashamed to enjoy it.  But they're fun, and almost universally liked.  However, I cannot countenance this open disregard, scornful, reprehensible and meanspirited as it is.  We, as a society, must demand better of each other.

Tuesday, November 22, 2011

UC Davis Pepper Spray, Joke Photo Collection

This is a truly horrifying event. And a brazenly open manifestation of the police state we now live in. However, a good joke going viral is worth a thousand protests. No one will forget this %$#hole again.

Thursday, November 10, 2011

China: No More Cheap Labor-CONSEQUENCES

I've been talking about this for the past two years, but I'm glad to see it gaining some traction.  Given the typical demand and supply curves, the most obvious way for companies to make profits is to lower the costs of production.  Right?  Simple economics.  There are two ways to do that: Technology and Cheap Labor.  Western democracies have done both, no need to explain that.

Politicians and pundits have used this fact on both sides of the aisle, often for conflicting purposes.  If its not the mexicans stealing jobs, it's the factory jobs getting outsourced to Asia, Bangladesh, India, etc. And everywhere the ray gun of capitalism is fired, populations are roughly enslaved--forced to work in deplorable conditions for a pittance.

At first, this doesn't seem so bad.  Factories often provide certain amenities (even the terrible ones) to its tenant-workers, room and board (taken from their already meager salaries,) minimal healthcare (cuts and scrapes).  In some countries where the local economies have been demolished through autocratic rule and farm-based economies are reduced to corporate serfdoms, this can often even lift up the population. Wage slavery, after all, requires enough sustenance to keep those brown and yellow hands a flutter with activity.

However, global capitalism (globalism) has for the past twenty years made a practice of finding the absolute perfect site for production of each part in the line.  A Dell computer, for example has its genesis in a spider web of nations, back and forth across the Atlantic Ocean several times.  How is this efficient production? I apologize for the shoddy map, my business textbooks had a much better one.  Every time the price of labor goes up in one country those lines change.  Of course, there are reasons NOT to change as well.  Overall stability is a big one.  No one will be building any factories in Afghanistan anytime soon (unless they're refining Opium).  Security in monetary systems are imperative as well.  If a dictator can seize your profits on a whim, then building a factory in North Korea may well be out too. (I was going to say Libyia, oh well).

Regardless, there comes a point, when the sheer amount of dollars (even when it disproportionately favors "the Haves" begins to lift up the local economy regardless of everyone's efforts.  Kennedy coined this phrase, though its been used repeatedly by the right recently: call it, "a rising tide lifts all ships."  It's not that things get better-because they get worse (see Apple factories), but reforms must be made. I've been wondering why that works out, and I think its because even when you funnel that supreme wealth into a tiny 1%, enough humane, reform minded people are able to be educated, and see how things work outside of the system, that they campaign for change. Usually the children of scientists, doctors, and lawyers, who are all trained in the humanistic doctrines of liberalism, because there would be no knowledge without equality and fraternity.

But I digress again, keep it together Ravingleftatic.

The point is--rising costs of production will change the game of globalism entirely.  Those changes will be endemic, and could be dangerous, causing market instability, currency fluctiatons and trade inequities.  Still, this is the time to do it.  No one will notice in a market that drops and raises 300 points a day.

But more on this later.

Wednesday, November 9, 2011

Great Op-Ed by John Paul Rollert

I just wanted to share this one.  Very eloquently worded.

John Paul Rollert

Friday, November 4, 2011

Goncharov's Oblamov - A Ravingleftatic If Ever There Was One

This is a great quote, from Ivan Goncharov's Oblamov, which I read in college under a fantastic Russian Lit professor:

What about humanity, pray? Writers like yourself try to write only with the head. What? Do you suppose the intellect can work separately from the heart? Why, the intellect needs love to fertilize it. Rather, stretch out your hand to the fallen and raise him, weep over him if he is lost beyond recall, but in no case make sport of him, for he is one to whom there should be extended only compassion. See in him yourself, and act accordingly. That done, I will read you, and bow my head before you.

Alex Pareene on the State of Journalism

I usually enjoy Alex Pareene's columns, he seems to be a true Ravingleftatic.  Today he commented on an article in Politico that was written terribly.  It reminded me of two articles I reviewed here based on their terrible writing/and or journalism.  It's fun and easy to pick out terribly written articles on all the major news aggregators, but I'd like to comment on a thought I had after reading Pareene's diatribe.

I'm an amateur writer, clearly.  And I've noticed it in my own writing.  If I know I have to write a piece for submission somewhere, I unintentionally beef up the "sound byte" text. You know the stuff that you expect to see in articles, and hear on TV?  Pareene quoted a good example:

"Rival Democratic and Republican jobs bills failed in the Senate on Thursday, the latest sign of the partisan gridlock gripping Washington as Americans look for relief from high unemployment and a sagging economy."

Let's parse this: 

Fact: Rival Democratic and Republican jobs bills failed in the Senate on Thursday

Filler: the latest sign of the partisan gridlock gripping Washington as Americans look for relief from high unemployment and a sagging economy

Now it turns out, says Pareene that even the Fact portion of that statement is incorrect.  But look at that vomitous, regurgitated, claptrap in the second half of the sentence. If I didn't have much to say, and I had to submit an article, I'd use terms like "partisan gridlock," "plagueing America," "the Washington Elite," feeling up a "sagging economy," supported by "the tax payers."  This is careless, terrible writing.  And that is the subject of this post: there is an urge in all of us to regurgitate that which we think our audience expects to hear. Even if we don't believe it, or agree with it.

Next time you watch a comedy, and that comedy shows a news broadcast, listen to the words the writers have chosen, (not the content, the words, the phrases) they're all chosen because we've been trained to know "newspeak."  All we need to hear are certain key phrases and we go on point like a dog guarding the house.  Our brain's instantly say, "this must be news," "this must be true," "Who can I tell?"

But our audiences aren't dumb, even when we treat them that way.  And reading such terms in an article that purports to report and not opine, are misleading.  It assumes facts!  Already in that article, we are told without getting a chance to argue that partisan gridlock is real, it's bad, and that it's equally spread across the entirety of the political scene.  Reinforcement of these Fauxnorms is dangerous in a highly contested political climate such as ours.  It's a bit like the old joke:  "Do you still beat your wife?"

Monday, October 31, 2011

Occupy WALL STREET Plank

Ok, so here is the follow up to my earlier post on the Occupy Wall Street movement.

I propose the following:

1.  Raise the Corporate Tax.  Taxes do not have an effect on growth.  Demand has an effect on growth.  Period, end of sentence.  Stop whining.

2.  Close tax loopholes, including taxes on inheritances and capital gains.  The government needs revenue.  It doesn't cost anymore than it did in 2008 to feed a family of four, welfare checks still do more for the economy than tax cuts for the wealthy.

3.  Create an index of companies with high CEO to Entry-Level salary ratios and tax those with the highest ratios.  Funnel the proceeds directly into social services for the middle and lower classes.

4.  Quit watering down the latent Consumer Protection Agency, beef it up

5.  Beef up the SEC, this has, to some extent been done.  But even now, the SEC doesn't go after the big fish.  Only the medium and small fish.

6.  Break up the giant banks

7.  Criminal prosecutions (that the DOJ actually takes seriously) for the participants in the 2007-8 Crisis. No matter how high up they go, even if it means Obama Administration higher-ups. But particularly the previous administration's "King's Men."

Thursday, October 20, 2011


So I had a conversation recently about Occupy WALL STREET, and it made me think.  Also, as a Ravingleftatic, economic egality is one of my niches, so I've been remiss in commenting.

I'm going to divide this post in twain.  The first half will be to rebutt my darling wife's comments.  The second will be to offer a firm plank to the occupiers.

Some of the comments about the occupiers I heard that was that the whole movement was basically a waste of time, with little or no focus, and that people like that make people like us look ridiculous, and that this news has been front page news for three years already.

Waste of Time:  Basically, the argument goes like this: they're bankers, not elected officials.  Why would they care?  Go occupy D.C.

Rebuttal:  It's not what the banker's think so much as the amount of media attention they get.  Having worked in the area, I can tell you: Zucotti Park is small.  A force of 100 protestors would look like a huge crowd.  That's important, small spaces make small protests look good.  And success begets success.  Such that Amy Goodman has now reported "thousands" of protestors, and has respawned in cities around the world.  By the way, the Guardian article linked to above, provides an excellent history on the movement.  D.C. on the otherhand is built for protests, wide open spaces that can swallow a thousand people with no problem.  Another thing?  If she thinks people in D.C. care about protestors...she's got another thing coming.  I went to college there.  There's always a protest.  A protest about a unique group of people in a unique site, is far more inventive and news worthy, than just another protest on the mall.  So the level, and length of media attention devoted to something is an important factor in deciding its effect.  That I'm writing about this now, shows that this movement has staying power, in the words of E. Roger's seminal work on technological innovation, I am a laggard (Early Adopters, Late Majority, etc.).  I get to the party when its ending (which doesn't say much about the occupation--but there it is).  I remember when people began talking about it.  I thought it was a miniscule, small movement that would die out by the next news cycle.  I was wrong.  So already it has had a tremendous effect.  The last point I'd like to make on this is the following:  Banker's aren't elected officials, but they're voters.  And they're vote matters a hell of a lot more than you or I: they vote with their checkbooks.  Obama received more money from Goldman Sach's than from any other group.  So changing their views and their opinion matters.  Will a movement of "dirty hippies" change their minds or serve to further polarize them?  Well--that's a reasonable debate.

No Focus:  The basic argument here is that, if I understand it correctly, they don't have a clear list of demands, a clear leadership, and they all appear to wear different causes. 

Rebuttal:  Having spent four years in D.C. during the worst President in history's first term, I can tell you:  Protests today don't have a lot of focus.  As a rule.  I'm no expert, but I do have some on the ground experience.  One of my favorite things to do as a student, was to wander around D.C. during a protest, and did so on at least six occasions.  I also was at the New York anti-war protests after college.  The people were spectacular.  Dressed (or undressed) they were always charasmatic and inventive.  There were always a lot of them, and they all sported their own causes, gay rights, anti-war, anarchy, anti-torture, to economic injustice and totalitarianism.  I think this focus accusation (which I've heard a lot from the very beginning) is a red herring.  In the 1960s and 1970s, the world, was technologically a very different place.  Information flowed in very different ways, and through very different nodes.  And, as a consequence, people are different.  We all have more than one cause.  And we want people to know that when we get it up to go out and protest.  It's not a repudiation of singularity of purpose, it's a celebration of diversity and a bringing together of diverse causes.  Add to that a well documented fact that people (Ravingleftatics, and Republithugs--alike) have less trust, and less reason to trust their governments than they've EVER had.  So no, not only do I NOT think that Occupy Wall Street is unclear or lacking focus, I believe that their diversity of values is a strength and a badge of honor.

They Make Us Look Ridiculous:  This is a sensitive one for many people.  I understand it, but let's say:  maybe my understanding is based on my own reasons.  It goes like this: Premise:  The Occupiers are kids, college students and career protestors.  They likely don't know much (or anything about finance, the economic collapse, what's been done since, etc.) all they have is their passion, and undereducated passion is dangerous in a democratic society.  Premise 2:  We DO know what we're talking about, lived here during the economic collapse, have alternately worked in the business, known people who have, and have read a lot of material to support our opinions.  Therefore, the people in the park, Park People, the occupiers, make us, temperate, educated, well reasoned people look bad.

Rebuttal:  Having written it out like that, I think the premise and conclusion rebut itself.  We obviously don't know any of these people, we have only news reports of their consistency to go on, and the news coverage has been anti-protest from the get-go.  Making the inference that any of these people are uneducated is unfair, and moreover may be completely untrue.  If they are college students, likely their learning is fresher in their minds than that of the vast majority of us.  If they're career protestors--dirty hippies-- (career protestors definitely exist, I've met them) they spend their long train rides from protest to protest reading material about that which has peaked their interest.  However, it is unequivocally true that the vast majority of them have never worked in finance, or finance related industries.  But then again, that's why we're so mad.  Finance is America's largest industry as a percentage of GDP.  People who actually make things, make nothing, where people who literally divide up piles of nothing, into other piles of nothing, to make more piles of nothing look like bigger piles of nothing get multi-million dollar bonuses.  And in most cases, they're no better educated  or qualified than we are!

Old News:  The old news argument is factually quite true.  The 99% is a well documented fact.  The fact that average and wages have actually decreased in the past forty years is true. 

Rebuttal:  There's nothing new to report here, it's true.  My rebuttal here, is based purely on my own memory and perception of the events of the past decade.  For the vast majority of Americans 2004 to 2007 was no better than 2008 to the present.  Wages didn't go up at all.  They decreased, and healthcare costs have risen geometrically.  As I've said before, most Americans are one epic disease away from the poor house.  What did go up, was the stock market.  For most Americans the only meaningful aspect of that was a commensurate rise in home values.  People's wealth increased, merely because of the housing bubble.  And during that time, people were encouraged, by unethical bankers and loan companies, to refinance the hell out of their homes.  So they took that loaned money, thinking it was theirs and bought new cars, iPods, flat screen, thin screen tvs, Bose stereos, or new homes.  And when the bubble popped, they were underwater.  Ok, talk about old news, Ravingleftatic.  We know all of that.  Why is that important?

It's important because in the past decade I have seen three major groundswells of positive liberal energy.  One: The anti-war movement that swept the 2006 elections and stopped the Republican majority (note that it wasn't a coup, they still had a president and one branch of the legislature--sound familiar?)  Two:  The next year, but particularly the last few months of the 2008 election.  Hope, etc.  And Three:  Occupy Wall Street.  As a consequence of those three bands of energy, 1) we took back congress 2)  we took back the presidency, passed healthcare reform, and a financial reform act.  And 3)  Well?  We'll see.  Get Obama another 4 years, reaffirm our hold in the Senate and take back the House?  Maybe. 

In between these groundswells of liberal energy, cynicism takes hold, and the otherside fights back.  We lost the 2010 mid-terms because people forgot that the state of healthcare in this country is an outrage.  They forgot that the AIG brass received million dollar bonuses of the public's money.  Whether or not they forget it, the media keeps redirecting attenion away.  The myth of the Tea Party is that they were something new, something exciting.  Research has shown that self-identifying Tea Partier's are merely Republicans who can tolerate gays.  The whole movement was made to order by the Koch Brother's funding, and put on for show by the major media outlets because they talked about liberty and wore tri-corner hats!

Sigh.  Let me bring it down a notch, and wind this up, I'll have to save the Plank for another Post.  (ha ha!)  This IS old news.  But the disparity between the 1 and the other 99% hasn't shrunk, it's grown.  Egality, and justice still favor those who can afford to pay for it, not those who deserve it or require it.  So no, it's not old news.  It is the most important news, and it always will be to a Ravingleftatic.

Tuesday, September 20, 2011

The New Inflation Debate

So, apparently, the great econoratzi have been having a brand new discussion about inflation.  Paul Volker, whom I usually admire, wrote in an Op-Ed in the Times yesterday, damning the idea before it got out the gate.  Volker is roundly credited with getting rid of the 1970s staglfation brought on by slow growth and high unemployment.

Let's begin at the beginning.  Inflation is currently, and has been for over a decade, at incredible lows:
2001 = 2.83 Bush, G.W.
2002 = 1.59
2003 = 2.27
2004 = 2.68
2005 = 3.39
2006 = 3.24
2007 = 2.85
2008 = 3.85
2009 = -0.34 Obama
2010 = 1.64
Inflation, as tracked above, does not include what they call Headline inflation, which I've written about in the past.  It's a basic market basket of goods that does not include objects that have temporaral fluctuations due to external causes, such as drouts, pestilence, hurricanes, fires, real act of god type shit.  Of course there are other factors which influence those goods too, and demand from third and second world countries is now beginning to hit its stride.  So when NPR reported this morning that food prices have gone up nearly 4%--this is not the inflation that gets tracked by the Fed, or by most inflation tracking indexes.

Moving on.  We all know why inflation is bad, we've all seen the pictures from Weimar Germany, or Russia during the 80s and 90s, wheelbarrows of cash to go to the grocery store.  Governments have one basic way to control inflation, through their Central Bank.  The U.S. did not always have a central bank.  It's been a consistent war.  We had one, then we didn't have one, then we had it again. People don't like Central Banks for the same reason they hoard gold.  The Central Bank issues currency, and as such controls the value of said currency.  They can also withdraw currency, by retiring treasury bonds early, or by not issuing them at all.  This is the only thing the Fed can do really.  It controls interest rate by buying, selling, and creating new bonds.  Quantitative Easing, the Discount Window, other things the fed is known for, can both be folded into this concept.

Given that interest rates are so central to investing and money flow, it became apparent, fairly early on that the Fed can exercise enormous power on the economy.  This makes them an exceedingly cautious entity, which in turn makes those who watch it, desperately follow every inflection, nuance and word choice in their carefully worded statements.  Three years ago, in the heart of the crisis (though even before the crisis) the Fed lowered interest rates to almost zero in an effort to stimulate the economy.  With low interest rates, companies can borrow cheaply, goes the theory.  And with cheap money will go investment, new factories, jobs created, etc.  This has simply not worked out.  For starters, as I said, before the crisis, the free wheeling 2000sandsies the rate was at near zero lows already.  Why?  When the money keeps rolling in, you don't ask why.  Simply, the Fed was in Bed with Wall Street.  The Fed has for three years kicked the can down the road and kept interest rates at historic lows, on the premise that when growth comes, at least it will come cheaper.

Now, with Congress deadlocked, and the President unable to do much until the next election, people are looking again to the Fed for guidance.  Afterall, the Fed is controlled by 12 men, sometimes 16, and getting a quorum of 12 dudes, is a hell of a lot easier than getting nearly 600 of the most contentious, often ignorant, and certainly ignoble bastards to agree on anything is pure fantasy.  But what can the Fed do?  It's entire database of knowledge has shown that lowering interest rates and increasing the money supply is the only thing it can do to the economy.  And interest rates are already at zero.  The answer is two things:  1)  Go for another round of quantitative easing (i.e. inflation) or 2) raise interest rates.  They've done 1) with only marginal effect, and a ton of whining, including a death threat from Rick perry, and there is simply no substantive data on what would happen if they did 2) in the middle of a recession.

About three months ago, they chose a middle ground.  They threatened to raise interest rates, in two years.  As I said, so nervous about the Fed are we, that a mere threat to raise interest rates, immediately unleashed a firestorm of criticism.  From even the one dissenting Fed Director, the most conservative, the Federal Reserve of Minneappolis.  I don't know why Minnesota has a federal reserve bank, really I don't.  Not the most exciting state in the union.  Anyway, the purpose, as I understand it, of this threat, was to tell businesses--get on with it.  You're not going to have this great interest rate forever.  Interestingly, the take away of one economist on NPR this morning was to say, "oh great, things will be the same for the next two years, no need to rush."  That's a paraphrase of course.  I did not take this away at all.  If a company is planning a merger, or a to ramp up production, it will take at least six months, if not a full year of planning.  That said--it's all hay anyway, because the Fed really only said it might raise rates in two years.

My apologies my friends, you wanted the NEW debate, and we've only just got here.  The new debate is that some (very few) economists have been suggesting that we actually let inflation rise.  The rationale is simple.  Low inflation is great for people who own debt, because most debt is locked in, mortgage rates, tuition loans, etc.  That means the debtee gets almost a real dollar for every dollar owed.  Add inflation and suddenly, the debtor has more money to pay the loan payments, which per agreement, remains the same.  This is an interesting thought--and for those following the European crisis, is the central problem that Europe faces--they're out of money.  If Greece was on the drachma, they could devalue their currency, and therefore avoid default.  It wouldn't look great, and it would cause massive inflation, but the inflation could be fixed, and it's still better than default.  And the bondholders would still get paid--to be sure, they'd be getting cents on the dollar--but again, still better than default.  And it's not permanent.  A ten-year bond could well rise in value after two years of an inflationary period.

Volker rang out yesterday with condemnation stating that inflation, is afterall, very hard to control.  And it could easily get built into the system.  Such that raising inflation to 3 or 4% wouldn't eventually do much, and we would be tempted to allow inflation to raise again.  Another economist on NPR this morning said much the same, that for rising inflation to accomplish its aim, it would have to go as high as 10-15%, which is indeed, a very dangerous level.  The highest inflation has been in 60+ years was in the last year of the Carter administration (when Volker was appointed) and that was a whopping 13.58%.

Anyway, it's an interesting idea, and the only point I wished to make about this whole thing is that it seems to me that interest rates being near zero, no longer has the stimulative effect that it's credited with.  The rate should get raised, and the rate should fluctuate naturally with the economy, so that it remains a valuable tool when necessary.

Thursday, September 15, 2011

It's not an Entitlement, it's a Responsibility

Again and again, I keep hearing politicians and media analysts talk about entitlements: "Democrats in Congress have to look at entitlement spending," "entitlement spending is out of control" yada yada yada.

This is one more example of Dems and Liberals letting the adversary control the dialogue. Entitlements. No one likes entitled people, they step all over you, and think the whole world is theirs to piss on. Bad entitlements. The term is so vague, and so misapplied that its a wonder liberal media analysts never challenge their opponents on it. I hear it on Chris Mathews, I hear it on Bill Maher, CNN. It's always used by the otherside, and the Liberals just nod their heads and shrug ponderously. They know its the wrong word--but they don't fight it.

Here it is people, let me lay it out to you, in stark, Ravingleftatic terms.

1. Entitlement spending doesn't exist.
2. Zero dollars are spent on entitlement spending.
3. Billions of dollars are given up by the IRS for inheritance taxes that have been mutilated--that's an actual entitlement.  (Root: titled, as in landed gentry, as in aristocracy, as in Republican.)
4.  The government has a responsibility to protect its people
5.  That protection goes in this order.  Freedom from want, Freedom from fear, and Freedom of worship, and Freedom of speech. (That's right, I changed FDRs order--Freedom from want, and freedom from fear trump freedom of speech and worship.)
6.  Unemployment, Social Security, Medicare-Medicaid, Food Stamps, Housing programs, these are the government's responsibilities toward it's people in alleviating the first first of those mandatory protections.
7.  Entitlements are what the government does for it's wealthiest--let's them off the hook.
8.  Responsibility is what the government has for its poorest.

Wednesday, September 14, 2011

Standard & Poor, is literally, more or less, that

I'm listening to the July 26th PlanetMoney podcast, which actually hearkens back to a podcast from May of 2010, in which they interview the sovereign ratings guys at Standard & Poors.  I don't have too much to say on this.  But this was from the horse's mouth.

S&P bases their sovereign ratings on two people visiting a country for a week.  That pretty much means that every American tourist in history is qualified to do ratings for S&P.

To be fair, they're not riding the Eye, or visiting the Eifel Tower and eating a crepe, they're visiting ministers of finance, and conducting interviews with central bankers.  To be fair, the guys they send are fair to midling brilliant, economists, accountants, and analysts, etc.  To be fair, mostly the ratings are based on reams of data that they go through in their cozy 49th floor offices in New York.  To be fair, all the ratings agencies have proprietary software that's designed to predict using specially designed metrics, on a level far above that of you, or I.

But enough fair:  A scientist conducting an experiment will take weeks, months, with controls and double-blinds.  They'll have their data peer-reviewed by other scientists.  They'll submit it to prestigious journals, which will have the data reviewed again before publishing.  Good research takes time.  Good research requires cross checks, and several sets of eyes. 

And once the two guys come back, they get another three people from S&P around the world, they give brief presentations, discuss and then vote.  Sounds like the whole thing gets done in a day.  Interestingly, the follow up interview said that this was not always the case, sometimes there are more voters, sometimes it takes a month to make the decision.

Tuesday, September 13, 2011

Social Security is NOT a Ponzi Scheme

I had a rough night last night, and I may not be at my rhetorical best, but this claptrap over Social Security is maddening to the point of apoplexy.

No, you turds.  Social Security is not a Ponzi scheme, is nothing like a Ponzi scheme, it never has been, and it never will be.

The central argument made by Perry, and Bachmann (the two least likely people in the GOP debates to have an original idea, much less a logical, or true one--THERE ARE NO BAD IDEAS IN BRAINSTORMING LEMMON) is that Social Security is like a ponzi scheme because you rob Peter to pay Paul.  But this does not a Ponzi scheme make.

There are three things about Social Security that have made it a big fat easy target to the wingnuttery.  1)  The first generation on social security (most of whom are dead now) never paid for it.  2)  Payments toward social security are mandatory.  3)  Money in virtually any other investment vehicle will do better than that invested in SS.

Point 1:  This is true, Social Security was established because the state of eldercare in the United States during the 30s and 40s was absolutely deplorable. On top of the Depression, was the larger issue that saving for retirement is all but impossible for the vast majority of the population.  When 85 to 95% of your income is spent on your day to day existence, even putting the remaining 10% toward retirement is a bit of a pipedream.  So Social Security was established to get that first, elder generation, out of poverty, eating food instead of pencil shavings, and having stable roofs over their heads.  Opponents of SS use this fact to indicate that some people got their's for free.  But the purpose of the program was to take care of those people.  So this wasn't 'free,' it was a government transfer program that was designed to pay for itself.

Point 2:  Opponents of SS have proposed two alternatives to the mandatory social security program.  1)  Opt-outs and 2) means testing.  Allowing either of these into the program would ultimately destroy it--which is precisely what people who suggest this are saying.  Both points sound reasonable, right?  Mandatory payments in the land of the free!?  What a travesty!  Nevermind that the pay as you go system of taxes have proven to be most efficacious and has saved the treasury and IRS billions of dollars in collection fees and litigation.  Tea Partiers love this point, but it's a red-herring, classic misdirection.  These "freedom fighters" don't care about the "violation" of a mandatory payment.  They simply see no reason for the program itself and believe that Point 3 should take prevalence.  So they suggest, why not allow people to opt-out of social security?  Simple fix, right?

Well--not really.  The problem here is a logicial one, and difficult to explain, let alone understand.  The program depends on mandatory payments because of its mandate.  Look.  Thirty years from now, if you haven't been saving, you'd still be entitled to Social Security.  Why?  Because that was the mandate of the law--to protect the elderly.  There is sixty years of caselaw in the system backing this up.  Even were the law to change--anyone who could pay a lawyer would have an actionable claim on SS.  Which means ultimately, that the system would be bankrupt in a generation, when a generation of opt-outers decide they're entitled to that for which they did not pay into.

What about means testing?  I heard the editor of Reason magazine make this argument on Bill Maher's Politically Incorrect.  "Why should a millionaire receive payments?"  This argument too is a red herring.  If the editor of Reason magazine doesn't know that the millionaire receives payments because he's receiving his own money back--than he shouldn't be an editor.  He knows.  Why this argument?  Great soundbyte.  The system is corrupt, millionaires don't need government transfer payments!  The system is based on a certain amount of equity.  It's a retirement program.  It's not a tax or a handout.  The money is yours, you're just getting it back when you're 65. Prince or pauper, so long as you worked a day in your life, you're entitled to some benefit.  (Personally, the only reform to SS that I would countenance would be to up the age.  People are older and working now than they were in the past.  We're healthier, and science has advanced our ability to work well into our early 70s.)  So why should a millionare make payments?  Again, equity, and see my previous paragraph: the more Opt-Outs the more you inherently weakent the system. 

Point 3:  This is one of the more insidious arguments against SS because it's completely true.  Social Security is not an investment vehicle--it's a savings vehicle.  This argument against SS is built on the idea that everyone is making proper arrangements for their retirement, which is patently false.  Let's face it, most people's retirement planning is non-existent.  The right, and Libertarians would like to believe otherwise.  But remember, the right doesn't care if you have money to retire.  They have money to retire, and if you're out on the street at 70, tough luck.  You were an idiot, it's what you deserve.

Never forget this one inalienable fact, Ravingleftatics, the Right would have you believe they care about freedom, about security, about morals, and about justice for all.  This is a deception.  They're only interest is in maximizing their own wealth, their own gain.  They assume everyone is acting the same as them.  They do not believe in collective action, or in altruism--in fact they say its impossible to act selflessly.  This belief is the justification for itself.  If everyone is acting in their own best interest, we'll all get something.  But its a tautology, and its premises are both false and laughably self-serving. 

In their world, it's all a Ponzi scheme, and they're all Madoff, running to the end of the line to get stuff out of other's hands and into their own.  And if you're an investor in their scheme, they assume you're running your own scheme and be damned with you.  And if you're not, well you're a sucker.

So my fine Ravingleftatics, do not believe this bull puckey about Social Security.

Tuesday, August 23, 2011

Jon Huntsman, Decidedly Not Crazy

Am I going nuts?  Is John Huntsman coming out as the real GOP contender here?

In the last two days I've seen three articles that affirm this possibility.

1)  Huntsman said the GOP was nuts to risk the full faith and credit of the U.S. Bond.

2)  Huntsman is unopposed to civil unions.

3)  Huntsman believes in evolution, and trusts scientists on globalwarming!

It's sad, that one of the Republican contenders for the seat actually has more liberal views than the sitting Democratic President, or at least has more courage of convictions.  He's also shown that he isn't afraid to lead the discourse, not simply kowtow to the crazy that Perry and Bachman have been touting.  In fact, he has been so effective in the past two days that I am going to go out on a limb and say, Huntsman's candacy effectively removes Romney from the race.  I know he isn't as well monied, or as well known, but he doesn't have a record of failure, and he's a relatively fresh face.  And, in case I haven't made this clear yet, Huntsman is NOT crazy. Now, all this may change if I found out he's a rabid libertarian, those dogs need to be put down.  But so far, he's merely a conservative.  I can live with that.

re 2)  I know that we all want Gay Marriage.  But as a policy, civil unions aren't bad, and they're a hell of a lot better than nothing at all.

So from a field of terrible contenders emerges one with some actual cred.  Go Huntsman or Go home!  Hopefully my endorsement of the Republican candidate won't destroy him.  With my thousands of readers and such.

Wednesday, August 10, 2011

New Poll: Americans want their Cake

A fabulous new CNN poll says absolutely nothing of value.  Apparently, a majority of Americans want taxes raised on the wealthy.  And, they want deep spending cuts.  They just don't want medicare or social security cut.  Oh.  It's that other spending we do that costs so much.  You know, that spending.  Doesn't this seem fundamentally ignorant to you too?

Americans are terrified of debt, and there's some reason for this.  Many of them have been foreclosed on, refinanced their home two or even three times.  Since their income's have been stagnant and rising at a rate well below inflation, they've been using their credit card to substitute as income.  So they've had consumer debt.  And though they knew things were bad in 2007, at least they had jobs and homes back then.

That aside, this ludicrous idea that people want the government to cut spending, but can't reconcile any spending in particular which they'd like to see cut--is just embarrasing.

Thursday, August 4, 2011

Thoughts on Political Necessity

I was, and remain, absolutely opposed to negotiations on the debt ceiling.  No one likes a high deficit, no one.  But the unemployment rate still hovers at 9%, and in six months, it will be even higher.  The problem as I see it, started from Day 1 where Obama started capitulating and ruling from the "center".

Last weekend, Obama had one other choice.  He could have invoked the 14th Amendment and circumvented Congress entirely.  But look at these arseholes.  Really.  Obama has been concilitory to the point of putting his cape in the mud so that those dainty conservatives wouldn't get their feet wet--and they still called him a fascist.  Imagine him invoking executive authority!  He'd have been nailed to the wall.  So this was not the right time to make a stand.

However, the spinmeisters really failed Obama again.  The Republicans came off looking poorly, but not that poorly.  And it's still many months till the election.  I'm not talking presidential, I'm talking about Congress.  I'm not really worried about Obama winning.  I'm worried about him winning back Congress.  Looking at the facts, the people who hate the social safety net won the largest conservative victory since the Reagon era.  Which frankly was more liberal.

This bill will be a disaster for America--but half of our recovery is confidence.  If the Dems can make major victories next term, we can reverse this.  And if we can show the world a confident America, our credit will improve instantly.  To get that confidence we need a jobs program, and a strong welfare state.  Two things which only a strong Democratic majority can provide.

Wednesday, July 27, 2011

Why buy a new house?

Two posts in one day!  Oh Frabjas day, calloo callay!

This is something I find very frustrating.  I moved around a lot as a kid.  I lived in 5 homes before I moved out.  My parents never once considered buying a "new" house.  A key economic marker, at least to the guys at Planetmoney, is the number of New Housing Sales, or New Housing Starts.  That is, the number of new houses being sold, or the number of new housing being built.  Neither makes much sense to me.

1)  The population continues to grow.  So we'll always need new houses.  But families die off, move around, houses burn, etc.  My wife's hypotheses is that this number will never be the same, and that excess inventory should be burnt to the ground.  I don't think that extremely, but what I do think is that, this number can't be all that exciting to watch.  The population doesn't change that much.  And yet, look at it.  It's a friggin' roller coaster:

So something must be screwy.  And, it is.  The housing market was a bubble.  People were buying homes and flipping them.  Homes were no longer a long term investment, and so speculators bought several of them, thinking to sell after making minor alterations.  People in my own family owned multiple homes, not because they could afford to, but because they thought they could sell before the bubble burst.

So maybe we should stop looking at this number.  The number should be relative stable, and should only match the need for housing beyond what is already on the market, which is considerable.  Manhattan is really the only place in the country that needs new housing, and frankly, we're a bit over-saturated as well.  Dozens of new luxury apartments opened up in the lowskirts of Harlem and Morningside Heights.  And most of those units are still empty!  Brooklyn had it much worse, and still has huge deserted tracks of useless luxury buildings.

2)  Not thinking about the economy at all, but frankly, there is only one reason to build new house.  Ecobuilding.  My wife's parents are examplar's of this, with the help of a graduate student in architecture, they actually constructed a house built specifically to have a low carbon output, no air conditioner, no gas heating.  It's still a work in progress, but it will be pretty amazing. 

Other than that?  No.  Not once in those 5 moves did my parents even consider building a home.  For one, in an old Connecticut community of bluebloods, development was anathema.  To be sure, they were there, we lived in one for several years.  But I can think of only three developments in the entirety of my town.  When people bought houses, they bought houses in established neighborhoods.

Everything falls apart.  I can see renovations on existing homes.  I can even see demolishing old homes because of filth, contamination, hoarding, damage, unsafe conditions.  But how often is that the case?  How often is it that a home is simply beyond the pale?  I can't think i  t's that often.  Apartment buildings in New York are rarely demolished.  In fact, it's almost impossible to extract some tenants.  There's a building on my corner that has been all but derelict save for one or two filled apartments.  Derelict for at least five years!  That's expensive real estate.  Worth millions and millions of dollars.  And someone is using it to the last drop. 

Bottomline.  I don't think new housing starts or sales should be an economic performance measure.  I think the only reasonable explanation for the chart above, is the proliferation of housing bubbles.

The Debt Ceiling

I've been busy, a dead relative, a case going to trial, and not a lot of time to write.

There isn't much about the Debt Ceiling fracas that I can say that you haven't already heard on NPR, CNN, MSNBC, Michael Lind, Andrew Leonard, Alex Parene, Elliot Spitzer, you name it.

But my loyal readers want a position on the debt ceiling--as if they didn't already know.  My away message on my email has been this for days, as Krugman wrote:  "As Mike Konczal of the Roosevelt Institute puts it, the G.O.P. has, in effect, come around with baseball bats and declared, “Nice economy you have here. A real shame if something happened to it.”"

Is the government bloated?  Quite probably, do efficiencies and cuts need to be made?  Of course they do, they always do.  But on the cusp of recession?  Are you out of your mind?  Even if the government were employing a legion of loafers, all of those people are at least 'working.' They're taking that money home and spending between 90-96% of it.  That's a 1.66 yield on each dollar spent.  Cut the loafers in good times, not in bad.

This has always been, and will always be, one more opportunity to kill the welfare state.  It has nothing to do with the deficit, interest rates have been at historical lows and up until now (there has been absolutely no movement in the market for U.S. treasuries, until it becomes more and more likely that we may in fact actually default on our obligations.

The question is, how far are they willing to take it?  No one likes to admit it, but even Republicans are hooked on the welfare state.  The government backstops their companies, guarantees their banks, runs courts and arbitration panels that make decisions that effect billions of dollars every day.  And those are just the capitalist arguments.  Most Republicans are middle class values voters (I say most, merely because the rich and the super rich are simply too few to count as a majority in any group) and most receive welfare benefits of some kind, whether its medicare, social security, unemployment checks, or other transfer payments.  When the treasury can't service the debt, the government is going to have to decide, who do we pay first?  I take it as a matter of course that non-essential government employees will get furloughed immediately.  But even the non-essential become essential over time.  Case in point, in Minnesota the government has been shut down for weeks now.  All well and good, but now the bars can't restock because the government agency responsible for alcohol licensing is closed indefinitely.

But this is a risk that the Republicans seem to be willing to take.  And this brinksmanship is so extreme that I'm beginning to wonder if they know something I don't.  This seems like bad news for them.  Of course, its a lose-lose for us.  A president who is unable or unwilling to fight for basic entitlements that the entire country benefits from and many of whom are desperate for, gains absolutely nothing from either party by compromising.  He may stave off a worldwide economic calamity, but he'll lose his party and his identity in so doing.  If the Republican presidential field weren't such a sad sack of rejects I'd be more mortified than I am.  Mitt will NEVER get elected, Pawlenty has already been lamed, Gingrich was out before he began, Bachman is the most promising of all, and she's bat shit crazy.

One last point, the Republithugs keep saying its ok if we get past the second of August, because we'll pay the bondholders first.  I agree, we'll have to, world peace depends on it.  But what happens when unemployment, social security, and medicare payments disappear?  What happens when entire divisions of the government cease to work?  That will be terrible for the anti-entitlement party.  But it will be worse for all of us.

Tuesday, July 5, 2011

Conservative v. Liberal: Economic Jujitsu

Ok, nothing substantively new in this post:  just thoughts.

The two parties offer radically different prescriptions for economic recovery, both with short-term and long-term ramifications.

The Liberal Plan:

Short Term:  Massive government spending, in infrastructure, education and transfer payments, keeps the money flowing directly to those who are spending it.  Every dollar spent by the government equals $1.8 dollars spent cumulatively, as each party down the lines spends 80% of the income received.  This is called an economic stabilizer, and economists from both parties agree them to be absolutely necessary.  For any economy to grow, it needs to find stability first. 

Long Term:  Investments in education pay off, as companies can hire more and better educated employees, who fill the structural employment gap noted by Libertarian economists as the reason why unemployment is currently so high.  Liberal economists would argue that with the massive government outlay listed above, unemployment is already reduced, and educated employees contribute to accelerated GDP growth in the long term.  Massive investment in infrastructure means employees can go where the work is, means companies can ship their goods at cheaper rates, means the costs of production generally go down, which makes demand leap up, etc. etc.  Continued transfer payments draw off as the unemployment rate lowers, as the baby boomer's continue to die off, and Generation Y finally goes to work.  Deficit gets reduced, GDP goes up, QED.

The Conservative Plan

Short Term:  By lowering tax rates, and generally drawing down restrictions and regulations on companies, the costs of production are lowered.  By lowering the costs of production, demand is allowed to rise with cheaper prices, and the economy slowly recovers.  Though there is much short term suffering as lowering costs reduce the social safety net, general prosperity will increase in the future, and until then, everyone who isn't making buck just needs to try harder. 

Long Term:  The lower tax rates, don't lead to new business.  Companies have simply taken the money and run, or continue to wait for positive signs in the economy to invest.  However, as the food lines are around the block, home ownership drops, and a dearth of government services mounts, the existing infrastructure crumbles, and business relocate to richer states, or completely different companies where the infrastructre remains solid, it is abundantly clear that this is NOT the time to invest. 

Moreover, tax savings begin to vanish, as the momentary surge in short term demand leveled off within the first year, and companies continue to lay off workers, because people just aren't buying.  Worse, now that transfer payments have cut off abruptly, the nation's baby-boomer's are dying in abandoned ghettos in Florida and New Mexico. 

The unemployed are forced to resort to crime, since there are no jobs.  Fortunately, conservatives are big fans of prisons, and the prison population swells.  The prison population ends up consuming all of the government's excess resources, until they're privatized, at which point, the inmates are neglected, fed based on work output, worked to death, and/or are genetically modified, and generally lose all the rights inherent to being human. 

Let's not forget that the conservatives have cut off all regulatory bodies, or worse, corrupted them to the point where they become industry revolving doors (I know, I know) and the public suffers from a rash of quack remedies which are untested at best, and dangerous at worse.  The only government services receiving any funding at all, are the police, who are advised to use extreme force wherever necessary. 

Financial regulatory bodies like the SEC have completely ceased to exist which means that the only check on the financial system are the public accountants who are paid by the companies themselves to ensure compliance.  Needless to say, compliance fades as businesses, desperate to derive some profits, switch to cheaper and less experienced accountants, who say everything is rosy. 

Everything is rosy, until someone notices the Emperor doesn't have any clothes, at which point the stock market begins to buck and writhe like a rollercoaster, and investors begin to unload U.S. stocks in a panic. The big banks close their doors and layoff hundreds of thousand employees, and as the government has completely defaulted on its debt, no one is willing to lend the money to bail out the government except China, Japan or Germany to bail out the failing U.S. economy.  China, which has been working like hell for self-sufficency tells the U.S. to get bent, takes the loss, because let's face it, they really could care less if their peasants starve or riot.  Japan which has its own crisis to deal with, takes a small portion of the debt, but not nearly enough, further losing their shirts in the decade after the worst decade in the history of the World.  The highly zenophobic population of the U.S. turns to Germany as its last savior...and on and on and on...

Sunday, June 26, 2011

The Chevy Volt

Joe Nocera, one of my favorite financial writers, wrote a great piece for the Times this morning on the Chevy Volt, check it out.

As someone who wants to be really green, but fails often, I was excited by what he wrote about the Volt and then let down.  Look, just by living in NYC I am one of the most carbon-friendly people in the country, but when I leave the city, I drive long distances--in rental cars.

1)  NYC rental cars rarely have fuel efficient vehicles.  Everyone asks for them, and they're always sold out.  I've only ever managed to get  prius twice.  The new Obama gas regs have helped a lot, I use a lot less fuel on these nine hour trips, but its still cruddy that I want to use such a vehicle and cannot.  Why they don't have more cars in their fleet?  I don't know.  I've asked.  Sometimes its supply problems, sometimes its having a variety of small-to-midsize cars.  I don't know.  Garages are crowded, and they're filled with Kias and other crap cars.

2)  The Volt sounds great.  We may have to leave the city sometime soon.  Anywhere else but NYC we're going to have to buy a car.  It is unlikely that I'll be able to afford a Volt.  Not yet, but there again.  I am exceedingly likely (if I remain on the East Coast) to take drives of three hundred miles or more.  The Volt turns into a regular car after the first 100 miles.  I suppose its still fuel efficient at that point, but it still sort of sucks.

Anyway, food for thought.  Hopefully Michael Lind's fracking dream doesn't nip this in the bud.

Wednesday, June 22, 2011

Freakonomics - The Warren Buffet Podcast - Growing Up Middle Class

So I'm listening to the Freakonomics podcast on Warren Buffet.  Now as you know, I am not a huge fan of Freakonomics.  They are mostly libertarian in their philosophy, and while they discuss some interesting subjects.  I must say, PlanetMoney does a better job of A) reporting, B) explaining and C) supporting.

Anyway, the subject for their May 11th podcast was Peter Buffet, the youngest son of the zillionaire.  I want to make clear, I have nothing against the Buffets, at all.

The podcast spends the first 10 minutes talking about how "normal" the youngest (50 years old) Buffet is.  That's great, that's really great.  Peter didn't know what his parents did until he was 25.  That's not normal.  That's privileged.

This is another reason why Ravingleftatic exists.  Income inequality breeds contempt for the poor among the arseholes of the ruling class, among the nice guys, it breeds honest negligence or disinterest.

There is one, fundamental aspect that is failing in this podcast.  People who don't realize how wealthy they are have had their needs completely taken care of for their entire lives.  I grew up hearing from my parents, "no we can't afford that," or "wait till Christmas," or "your father lost his job" or "your mother lost her job," or "we're saving that for your college fund."  It was much worse for my wife, who grew up the eldest daughter of an electrician in rural Canada.  50-60% of all the fights between spouses is over money, and when money isn't an issue...well, its not that things are hunky dory in the house, no news is good news.  But, as anyone from the poor and middle class knows, money is ALWAYS an issue.  And it causes stress.  This is stress that pervades our entire existence, shortens our lives, makes us fat, tired, gives us heart conditions and diabetes, and generally kills us sooner.  Peter Buffet never had to worry like that.

My wife still harbors this idea that we will someday not have to work, and she works herself into great fits of anxiety over the idea that we will always struggle.  But that is the case for the middle class.  We're one serious trauma away from poverty and all its depredations.  And its swim swim swim against the current, just to keep from floating downstream.  This is what's wrong with this country, this planet, this economy.

The single most offensive statement:  "I would much rather have invested in myself, taken the time, grown my own life, with all the mistakes and all the successes, and everything else that I can say is mine, as opposed to have a pile of money that essentially belonged to someone else."

Well fuck you PB.  The rest of us want the money.  Now Peter Buffet is a philanthropist, so that's good, and he's using his money to help poor women in foreign countries.  So, again, not against Peter Buffet.  I'm railing against the uncritical attitude that Freakonomics took here.  I will be working until the day that I die.  Struggling to make ends meet for myself, my wife, (god willing--my children).  And, I don't even mind that so much as I mind the fact that PB is making money selling a self help book telling people to follow their dream.  If there's one thing, one thing, I could tell my younger self:  Money will matter more than anything other personal goal you set or milestone you meet.  You may not think so now, but that's because your parents are supporting you.  You may not think you need anything, but there will be people who count on you.  Responsibilies will come to you whether or not you seek them.  And you will need money to meet those obligations. Invest in your career now, or regret it the rest of your life. 

I don't know that I would have listened to me. 

But bottom line it, Warren Buffet paid for his kid's college, allowed him to study music.  Music!  Which an NPR podcast from a week later said was not worth a college education, because you'll never make enough money to pay off the start up debt.  But its good to know that extremely wealthy people will carry on the great intellectual traditions of our society, because they'll be the only ones who can afford to do so. 

Mama, don't let your babies grow up to be in the humanities.

Monday, June 13, 2011

CNN - On the Middle Class, The Uber Rich, Income Inequality

So, CNN has been running some front page articles on the demise of the middle class.  This is the reason Ravingleftatic exists!  All those other pesky issues are just side shows.  Yes, Ravingleftatic wants justice for all races, Ravingleftatic wants to eliminate torture and genocide, yes Ravingleftic wants gays to have the right to marry, yes Ravingleftatic wants religious freedom, but Ravingleftatic exists for this:  To eliminate or reduce the rising income inequality between the classes, to deny the aristocracy and the noble class and to promote fiscal equality among democratic peoples.

Which is not to say I don't believe rich people can't be rich.  But a Gilded Age, or the New Gilded Age as people are calling it is a sign of a rotting democracy.  In my old job I'd read about the excess of corporate malfeasance, parties with mountains of cocaine, hookers, secret caves, mansions, and black jack tournaments, ice sculptures, and shell companies, tax shelters and shady investment vehicles.  This is the realm of fiction, that these things actually happened was a travesty almost too much to bear.  But...I'm getting a bit ahead of myself.

The first article is the rising cost of a college education.  Now CNN articles in general are snapshots.  There is very little actual data, though it does include the following nifty chart.  Even so, the snapshot is nonetheless horrifiying.  One of the seminal liberal papers, the Philip Agre paper on "What is Convservatism and What is Wrong With It" makes a point of saying that conservatism is the last vestige of the old feudal social order.  This article highlights one aspect of that truth.  Education for all is liberalizing.  In the feudal societies, only the rich were educated, and only the priesthood.  Keeping the poor superstitious and fearful was one of the main jobs of the aristocracy.  What are fears about The Global Warming Hoax, and Birtherism but base superstitions?  So when it becomes clear that upper education is being choked off for even the middle class this ought to be cause for real concern.  And it is, however, there are some political upsides.  When I was in school, everyone was in school, my own sister used to say, "everyone has a college degree, it's not worth anything anymore."  The argument was ridiculous, but it cast doubt on the efficacy of higher education.  This was a very effective means for "the Haves" to discourage college participation.  So now, perhaps the scale will tilt forward again, particularly with unemployment so high and the facts about employment so clearly favoring those with a four year degree.

One thing to say, Obama has already done a hell of a lot more for the middle class than any conservative president has ever done.  Including the overhaul of the student loan program, which among other things forgave some student loan debt and allowed for increased college subsidies.  Still, it's not enough, and the root of the problem remains.  Income, Income Income.  The minimum wage is the smallest part of the problem.  I took economics, I understand the effect of price floors and ceilings, but something has to be done.  There is this conceit that exorbitant salaries are required to lure the best talent at the top branches.  But is that really true?  I mean, the "best talent" caused the economic meltdown to begin with.  I know, an over simplified analysis, but at the most basic level, it remains nonetheless true. 

There was one thing from this article I wanted to note, and to correct:

"Economists speculate that one reason unemployment is so high is because the American workforce lacks the skills needed to fill the jobs that are open. As a result, companies may shift these jobs overseas, where wages are often cheaper"

Ok, first off, lazy reporting.  What economists, and why are you sourcing mere speculation?  Second, I keep up on this sort of thing, so I know already who CNN is referring to (Narayana Kocherlakota), and its been debunked.  There are some economists, Chicago School, of course, who insist that the real reason for the high unemployment is because American workers aren't trained for the jobs that American companies require.  The counter argument is simple, "Job openings have plunged in every major sector, while the number of workers forced into part-time employment in almost all industries has soared. Unemployment has surged in every major occupational category." P. Krugman, continuing, "percentage citing problems with labor quality is now at an all-time low, reflecting the reality that these days even highly skilled workers are desperate for employment," citing the NFIB.  Third, and last, there is a weird logical leap between the first sentence and the second, namely that since companies can't find workers in America, they're going overseas where labor is cheaper?  I think the author spliced two valid ideas here, incorrectly.  Outsourcing is a common enough problem, but it occurs when wages are too high, and usually occurs with unskilled labor.  So outsourcing the help desk is a good example.  Sending those jobs to India saves the company money, but they're not doing it because the labor pool is too small.  Now, a small wage pool drives up prices, but with 10% unemployment, a small wage pool is NOT our problem.  What the author should have stressed is that companies, with all time low demand, are searching to cut costs to improve margins, and searching the bottom of the barrel for the cheapest way to get product to market.  Which of course, dilutes everything, because no one here can afford to buy the product, and so it goes.

Moving on.  Another article "How the Middle Class Became the Underclass."  Go CNN.  Or actually go Annalyn Censky, who happened to pen all three of these articles.  There isn't much in this February article that I hadn't read already, but its good that someone in the mainstream media keeps bringing this subject up.  This isn't free market capitalism, its the height of market inefficiency, with billions of dollars wasted, sitting in trust funds or in various investment vehicles where it isn't getting spent or creating further value.  This needs to be highlighted, studies need to be ran on the loss of economic growth from this stagnation.  And more articles about the opulence of the top 1% need to be written and sensationalized.  People need to be more angry.  And they need to know.  This isn't capitalism, this is feudalism.  Which brings up one of the most important points in the piece, the decline of unions.  Private workers are mad at public workers, because the private unions are almost non-existent, and so workers in government are better paid.  This is a myth which has also been debunked--the truth?  There aren't any valid statistics to support a claim either way.  Federal workers are more educated, more federal jobs are white collar, and the government has contracted out many low-skilled jobs, further skewing the average.  One thing is for sure, Federal workers get better benefits -- duh!  That's the point of collective bargaining!  One other thing I think needs to be said in defense of federal workers.  There is a strict hiring procedure, a strict raise and payment procedure which is difficult to game, and often very stagnant, making it harder to rise in the ranks, or get raises in the public sphere.

The article also attacks globalization as a part of the reason for the rise, namely, the exploitation of new wage pools and untapped markets.  Anytime a new pool is tapped, the market makes adjustments, and those adjustments take generations to reach anything approaching "efficient."  For example, after 50 years of cheap Chinese labor, demands for higher wages are finally being met.  And so they move the factories to India.  The sad fact is that the creation of the middle class was ultimately countenanced by the Black Death, and the commensurate labor shortage.  Still, even if it takes generations many of these bumps will get ironed out.  At the cost of millions of lives crushed in meaningless poverty.  This is the reason the government needs to be an actor in this drama.  Lives are at stake and a nation's duty is to the welfare of all of its people.  And then there are the aristocrats who fight tooth and claw to turn back the clock.  Anyway, I rave.

Another thing the article points out, "In 2000, the Commodity Futures Modernization Act also weakened the government's oversight of complex securities, allowing financial innovations to take off, creating unprecedented amounts of wealth both for the overall economy, and for those directly involved in the financial sector. "  This is a good thing to know.  It was the last in a series of "reforms" made by the last four presidents.  In financial history, you should learn the name of the CFMA, and its often overlooked.

The last article bothers me.  Not because its point, I agree with it. "How the Rich Became the Uber Rich" but because of its tendency to place blame equally on both sides of the aisle.  There' one offs, simple lines like "The idea of deregulation gained momentum through several decades of policy put forth by lawmakers on both sides of the aisle and the Federal Reserve."  Or, in the previous article, "A major game changer came during the Clinton era, when barriers between commercial and investment banks, enacted during the post-Depression era, were removed," while this is essentially true, I find it oversimplifies in an effort to be judicious in placing blame.  Why be judicious?  The Gramm-Leach-Bliley Act was proposed by three Republicans, and passed mere months before GWB became president!  Not only was Clinton barely acquitted of impeachment eight months before, he was the lamest of lame ducks!  Dennis Hastert was the leader of the Republican majority elected in 1998, Trent Lott lead by 55 seats in the Senate!  Obama will also get blamed for extending the Bush taxcuts, and from a Ravingleftatic, that's completely valid, Obama capitulated.  But from the right, it's sheer hypocracy, those taxcuts were forced on us, again, by a new Republican house!

At anyrate, props to my girl Annalyn Censky.

Thursday, June 9, 2011

Michael Lind - Fracking

So my buddy Michael Lind is again making the case for a resurgence in fossil fuels.  And I must say he's beginning to convince me.  I'm not won yet baby, I need more sweet talking.  I must say--he almost sounds like he's shilling for the Natural Gas Industry.  I hope not, one political betrayal at a time.  On the topic of WeinerGate (the first gate since Watergate which is truly awesome and appropriate.  Don't we all seek a weinergate after all?)  I might try that one on my wife soon as foreplay.  Sigh.  Ok.  Briefly, I really don't care about what goes on in a politician's bedroom.  None of them, whether or not he's a Republican or a Democrat.  It's the policies that matter, the men, are just men.

On to Fracking.  As you know, Lind is a fan of cars, driving, gas and energy.  He says that the use of "shale" gas, which was previously unrecoverable is six times as much as oil, cleaner and with modern technology easy to refine and produce.  He says that we could be witnessing the rebirth of the fossil fuel energy industry.

"If gas hydrates as well as shale gas, tight oil, oil sands and other unconventional sources can be tapped at reasonable cost, then the global energy picture looks radically different than it did only a few years ago. Suddenly it appears that there may be enough accessible hydrocarbons to power industrial civilization for centuries, if not millennia, to come."

Wow, how exciting!  He then goes on to say how all the reasons for sustainable energy are now irrelevant.  1)  Peak Oil is no longer an issue.  No imminent energy crisis. 2)  No political blackmail.  Shale gas, tight oil, gas hydrates are everywhere!  Wheee!  3)  The effect on the environment is no big deal, Natural Gas is clean, drink up!

This is where he loses me:

"The scenarios with the most catastrophic outcomes of global warming are low probability outcomes [Huh?  says who?]-- a fact that explains why the world’s governments in practice treat reducing CO2 emissions as a low priority, despite paying lip service to it [if by lip service you mean broadly denouncing global warming as a hoax, then yes] . But even if the worst outcomes were likely, the rational response would not be a conversion to wind and solar power but a massive build-out of nuclear power. Nuclear energy already provides around 13-14 percent of the world’s electricity and nearly 3 percent of global final energy consumption, while wind, solar and geothermal power combined account for less than one percent of global final energy consumption." 

Phew, boy am I glad that Lind is here to be rational for all of us.  There's a reason wind, solar and geothermal use less than 1% and Lind knows it.  Governments need to get on board and ask for them, governments are the major purchasers of energy resources afterall.  And then he whitewashes the nuclear disaster in Japan.

"The disasters at Chernobyl and Fukushima have dramatized the real but limited and localized dangers of nuclear energy."

A radiation plume spanning the entire Pacific ocean is a localized disaster?  The problem isn't that nuclear energy is unsafe, it's perfectly safe in controlled environments.  The problem is what to do with the waste, which will be radioactive for centuries, and when it all goes to shit (unlikely, but possible) a few of these "localized" disasters in different parts of the world could make the entire planet unlivable.  Or at least, hopefully medical science will keep up with the rising rate of cancer and will develope Battlestar Gallactica like radiation pills.

But I was serious, Lind really does make a convincing argument for Natural Gas, though his arguments consist almost entirely on debunking "alarmist" "Green" studies about the dangers of NG.  His most convincing arguments are political ones.  Namely that to develop sustainable energy will require an enormous governmental cost--which is true.  Wind/Solar had a tremendous boost in the Roaring Two-Thousandsees, when investment banks were using green companies as tax shelters for millions of dollars, but now that the investment banks are gone, and the economy is still staggering, the cost of propping up green energy to the levels needed to power our communities, might well prove too much.  Not when Natural Gas is knocking at the door with a plate of brownies.

Even so, he has a very dismissive, non fact-substantiated view of Green Energy:

"Eventually civilization may well run out of natural gas and other fossil fuels that are recoverable at a reasonable cost, and may be forced to switch permanently to other sources of energy. These are more likely to be nuclear fission or nuclear fusion than solar or wind power, which will be as weak, diffuse and intermittent a thousand years from now as they are today. But that is a problem for the inhabitants of the world of 2500 or 3000 A.D."
My friend, that's a whole lot of assumptions in one paragraph, I don't need to tell you that.  Let's ask my other friend, Andrew Leonard.  He comments on the exact same paragraph above!

"A better explanation for why the world is treating climate change as a low priority problem might be because the U.S. -- historically the largest producer of greenhouse gas emissions -- has refused to take any action at all."
Another goody of Leonard's:

"I'm not sure what definition of catastrophe Lind is using, but the unprecedented frequency of extreme weather events that we are already witnessing all across our planet is a strong indicator that global warming is already contributing to serious disruptions"
As to the relative safety of fracking, Leonard gives us some interesting tidbits:

"I defy anyone to read the New York Times' massive, exhaustively reported series on pollution problems associated with fracking and still not be concerned with threats to the nation's drinking water supply or the multiple failures of our regulatory system. "

Last but not least, Leonard lays it to Lind with Lind's alternative, nuclear energy:
"The more pertinent question to mull is why, if the economics of nuclear power make sense, private industry can't seem to make a go of it. The free market isn't very friendly to nuclear power -- it is most widely implemented, today, in countries where there is a strong state presence in the industry, like France or China. Building enough nuclear power plants to make a dent in climate change will be massively expensive. And if we're going to subsidize new sources of energy why not funnel that government funding toward sectors that do not have waste or potential meltdown issues -- like wind and solar."