Category Archives: economics

Nixon in China

Robert Gates, telling Congress to cut it out.  Literally:

In a speech that was as welcome as it was remarkable, the Pentagon chief explained that the Congress, Department of Defense officials and defense contractors had allowed military spending to grow unchecked after the September 11, 2001, terrorist attacks on New York and Washington.

Warning that this sort of budgeting without checks or balances is unsustainable, Gates called for a radical shift in direction.

“What it takes is the political will and willingness…to make hard choices — choices that will displease powerful people both inside the Pentagon and out,” Gates declared on Saturday, in a speech at the Eisenhower Presidential Library in Abilene, Kansas, where the current Secretary of Defense noted that the, like many military men, the commander of U.S. forces in Europe during World War II worried about excessive defense spending and warned about the threat posed by the “acquisition of unwarranted influence, whether sought or unsought, by the military-industrial complex.”

Here’s a nice background article on President Obama’s first defense budget last year.

Both articles are worth the time to read them.

Unable to do math

I read this Joe Klein post and had to agree.

If you are getting a paycheck, you couldn’t help but notice that your take home pay has been better since last April.  Unless you are someone who can’t figure out why that happened.

The majority of the working poor in this country are white people.  Yes, yes, yes, a larger portion of minorities are poor, but did the white working class people miss the fact that they got a pay boost last April?  Has every single person forgotten that they essentially got a pay raise?

I think so.

Here in Houston, we have no less than four AM radio stations that spend almost every waking hour trying to tear down this presidency.  You can hear their gloating on almost any channel.  This is far worse than anything that happened in 2005.  There is a community of people who want President Obama to be a one term president — for no other reason than to gloat over it.

With the Supreme court opinion last week and talk radio types pushing for corporations to make a stand early, I think our system will break.

One thing I know.  If the system breaks, Obama is the person who I trust to fix it.  Why else would he have tried to hard to be president of a broken country?

So, here we are.  A nation of idiots who don’t even know how or what happens to their own damn paychecks — they just think GREAT more money.  And for the house flippers and the bankers who are too scared to loan the money THAT YOU HAVE ON DEPOSIT that they use to not make loans, but keep and pay you very little if any interest — cry for them — just like Michael Berry cried for those poor bankers today.

I blame teachers.

A Trade-off of Sorts

We have survived.  I work for the state, but with a twist.  I work in an income producing department.  After 9/11, we had some very dark days.  For the past year or so, we have been building our student population.

We’ve got over 140 students and it looks like it will increase.

One reason is because the dollar is weak and it is cheaper for internationals to come here — another reason is how cheap it is to live here in Houston.

Frontline is depressing.

Tomorrow classes begin.  I’m ready except for recording some more commercials for my writing class.

And I guess I am still an Obamabot.  He’s doing everything I could hope for and pushing just the way I think he should.  Steady on.

That’s the Ticket!

It’s a very good thing that our friend Kathleen is only in charge of a household and a blog and not the economy or the war effort in Afghanistan (or even foreign policy as I pointed out earlier).

On the economy, she has a post up about the deficit.  Her source is a blog post at the  American Enterprise Institute which has a pretty graph that was cooked up supposedly using OMB numbers, but there is no link to any specific OMB report(s).  The graph makes George W. Bush look pretty bad, given that it also includes the Clinton surplus.  But it makes projections for the Obama administration look horrible.  But that’s the point, right?  There’s no indication whether Obama’s ban on accounting gimmicks (piker, indeed) is calculated into the Bush numbers or whether the sunset of the Bush tax-cuts-during-two-wars are part of the graphic.

But unskeptical Kathleen runs with it:

Maybe THIS is why we protest now and not under Pres. Bush?

She’s still fooled by gimmicks.

In the long run, spin can only go so far. People can look out their doors and see what is happening to our economy.

Really?  In the Woodlands?  In my neck of the woods, we are holding our own.

The Labor Department will release the September unemployment report on Friday. It’s probably no coincidence that Pres. Obama is out of the country that day, deciding on a whim to go help out Michelle get those 2016 Olympic games for Chicago.

She just had to get in a dig about the Olympics.  I’m surprised that she didn’t go as far as Bill Kristol and telegraph possible travel to Afghanistan to the Taliban.

And today she realized that she’s just done with the Afghanistan war and has become a peacenik.  Oh, not really.  She’s just throwing a temper tantrum and wants to take her ball home.  She was never really into the NATO led military action in Afghanistan anyway.  She got her charge from the mostly US led actions in Iraq (which is telling). Again she sees President Obama as reactionary.  On top of that she doesn’t understand the chain of command and that bypassing General Petraeus (one of her heroes!) is not the way this sort of thing works:

When the news got out that Pres. Obama had only talked to the U.S. Commander in Afghanistan ONCE in the last 70 days, they quickly put together a conference call. This is a President that has no interest in war. Who doesn’t believe in ANY war.

He has no business leading one.

I see.  That last comment is followed by another surprising comment — given that Kathleen supported the surge in Iraq and would presumably remember how long it took in 2007 to get more troops into Iraq.  But no:

43 U.S. troops have died since Gen. McChrystal called for reinforcements.

How many U.S. troops died while the surge was is process?  How many Iraqis died in 2007?  Her memory is so short she should be tested for Alzheimer’s.  The last insult?

we need to bring our boys and girls home

I watch The News Hour every day and This Week every Sunday.  I see the military personnel killed in Iraq and Afghanistan each time they pay tribute to them.  I stop what I am doing and pay attention — pay tribute.  They are not boys and girls.  Kathleen is not old enough to patronizingly call them “boys and girls.”  Perhaps she feels free to write that sort of thing because no one in her family, including herself, have ever served in the military.  To her it is just a game, or a petty way to make a political point.

I’m not sure which mailing list I’m on to have gotten this . . .

and after initially doubting it’s validity, I found it is legit.

invite

At first, I couldn’t figure out what was on the flag, but then I realized it was a blow dryer and a flattening iron.  The company is Farouk Systems Group, and they are closing their factories in South Korea and China and moving back to Houston, where the company is headquartered.  It’s a ribbon cutting ceremony, but it also looks like a job fair.  The company expects to hire over 1200 people.  It’s good news.  Also, from the ABC article:

The expansion is happening because Shami is moving overseas manufacturing back to the United States, a move he says other companies should follow.

“We need to be good Americans,” he said. “We need to be good citizens. We can sacrifice some of our profit and bring jobs.”

According to the invitations the invitees include:

invite2

What do you think, should I RSVP?

Card Games

From the local news, it appears that a bridge tournament is going on here in Houston.  I don’t know much about bridge, but it sounds like Spades or 42 with cards.

When I was a kid, my family played three games more than any others: 42, spades and demon.  I never got into 42, though my mother and my uncle were rumored to cheat because as a team, they always won.   i prefer regular Spanish dominoes.  I’ve played spades online for years, though not for status, just for fun.  Mostly I play suicide double nil, which is easily as difficult as bridge.  My family used to play the same game with two decks when we had enough players — that means you could go nil with an ace of spades if you thought you could do it.

The best card game I have ever played is demon.  It is group solitaire on steroids.  You have a demon pile — 13 cards.  Then you lay out 4 more cards face up across.  You then turn three cards at a time, play your cards out in the center of the table, aces first, and play off your four card red/black, all while everyone else in the gam is doing the same thing.  Everyone can play on everyone else’s ace starts and the goal is to get rid of your demon pile faster than anyone else.

While demon is a very fun game, I’m sure it’s never been such a draw or distraction as to bring the economy down.

Everyone I Know Has a Job

My sister is the only person I know who works for herself.

And yet, everyone I know is worried about their jobs.  I worry about mine because I lived through what happened after 9/11.  While that involved students getting visas, now I worry that internationals won’t see the benefit of coming here to study.  I also worry about how much it costs to live here in Houston.  One of our selling points is that it’s relatively cheap to live in this city and our tuition is competitive.

My sister did well enough at her craft show this weekend — she almost got blown away by the wind, but she sold her stuff.  She is talented and produces quality work.  (Crap, the voice of Morgan Freeman just came into my head: She will survive.)

My other friends and family have steady jobs; jobs not — for the most part — affected by upturns or downturns in the economy.

However, I still find myself checking the Google News Business page everyday, much like I did the dailies of approval ratings for George W. Bush.

Betting Against

Tonight on the CBS nightly news, they had one of their gimmicks (stolen from Paul Solman).  This time it was about credit card debt and it made me think.

I don’t have dental insurance, so I rely on my Care Credit card.  I can put my dental work bill on it, and if I pay it off in the time period allowed, I pay no financed charges.

I’ve had my dental surgery done by one dentist and then the rest done by another.  The second dentist let me know why he didn’t participate in the Care Credit plan:  if I paid it off in time, he would have to pay the finance charges that I avoided.

I don’t want to dis my primary dentist.  He’s great.  But perhaps he got caught up in the same thing so many others did:  betting on people not paying on time.

Perhaps I wasn’t alone in paying things off.  I know there are so many who are in debt, as am I, because I paid off my dental bill on time.

But there should not be a way to bet against people paying off their debts and making a profit off of it.

Economics is a SOCIAL science for a reason.  It is connected to psychology more than anything other discipline.

In cruder terms, why people spend or save, why they create instruments that bet on fail, is more about psychology than science.

I

Ooops! The GOP Needs to Substitute Poland for Ireland

There was an interesting report on the News Hour tonight.  The transcript should be up later and I will add it.

Remember when John McCain and every other Republican used Ireland’s corporate tax policy as an example of how US corporate taxes are too high?  Oh yeah, that was last year and things have changed.

The Irish economy boomed through both subsidies and low tax levels.  Business boomed.  Poles immigrated to Ireland and got jobs.  Everybody had work.  But then the companies that the Irish government had lured found they could pay lower wages in places like Poland, closed shop and left many Irish out of work.   There was a building boom, too, but it didn’t last either.

It seems that the Polish government made lower taxes, subsidies and lower wages work for them, too.  Many Poles went home and some Irish workers immigrated to Poland, following the jobs that had left Ireland.  And working for less money.

So, in the end, sure, the US sure have a corporate tax structure like Ireland.  That works right in with the current GOP wish list:  they want the stimulus to fail; they want Obama’s policies to fail; and at least Dick Cheney seems to want a terrorist attack, just so they can all say:  WE TOLD YOU SO. 

Until everything is completely in the crapper.  Then someone like Newt or Sarah Palin can pop up and say, “Elect me!!!!!!”

“I screwed up.” UPDATED

How refreshing is that? I watched Obama’s interview on CBS first and then changed over to the other three stations to catch just the end. While I have been lazy about changing the channel, I won’t be anymore.

I am part of the ‘wait for it’ community. (Perhaps I am a community of one or two?) Obama will get the bill he wants when he wants it. Letting the Republicans feel their oats is part of the plan. Didn’t anyone else wonder why there were no Obama administration people on the talk shows last Sunday? It’s all about giving them the room to put forward their corporate tax Christmas tree while offering a dry bone to other tax payers.

In the end — which will come soon enough — Obama will sign the right bill.  I have no doubt about that.

From The Corner (which is where they belong, but they haven’t gotten the jole they played on themselves yet):

On Capitol Hill, you can feel the Republicans’ growing sense of confidence.  They’ve scored a lot of hits on the stimulus bill, and now they’re aiming higher.  “We’ll try to make the bill better,” Sen. Jim DeMint said a few moments ago, “but this bill is so bad…you can’t fix it by tweaking around the edges…The best thing to happen would be for President Obama to lead, to call a time out.”  Several Republicans now want to throw the whole bill out and replace it with a package that is nearly all tax cuts — “twice the jobs at half the price.”

Like the 18 million jobs Demint says that the Heritage Foundation says that the Republican tax cuts will generate?  RIGHT.

With that growing sense of GOP confidence comes ramped-up pushback from President Obama.  “In the past few days I’ve heard criticisms of this [stimulus] plan that echo the very same failed theories that helped lead us into this crisis,” Obama said at the Treasury Department today.  “I reject that theory, and so did the American people when they went to the polls in November and voted resoundingly for change.”  Look for Obama and his allies to push the argument that the Republican plan is one-dimensional and insufficient.  If the roof is leaking, they’ll say, Republicans prescribe a tax cut.  If the car is stalled, they prescribe a tax cut.  If the house is on fire, they prescribe a tax cut.  Tax cuts, tax cuts, tax cuts.

Sure, Mr. York, it’s only coming because the GOP is becoming more confident now.  Feeling their oats.  Living the vida loca.  And anyone who points out that the GOP solution to the economic crisis is TAX CUTS would be correct.  That’s all that’s there.

Smarter GOP types, please.