I like Peter Schiff

Peter Schiff has a nice little piece in the San Diego Union Tribune from October 10. It's so cynical that it must be true. He gives some great advice to the would be foreclosed individual:

If your mortgage does become the property of Uncle Sam, the growingly popular impulse to “just walk away” should be replaced by “just stay and stop paying.” No one will throw you out. After a few months, or years, of living payment free, you will get a call from a motivated government agent eager to adjust your loan into something affordable.

To bolster your bargaining position it will help to be able to claim poverty. As a result, if you have any savings, spend it soon, before they call. Buy a bigger TV, a new wardrobe, or better yet, take a vacation. After the hardship of spending all of your refi cash, you probably deserve it. If you have any guilt just remember, Washington argues that consumer spending is the best way to stimulate the economy. Living beyond your means is a patriotic duty.

New Family Blog

FYI, I've started a new blog to chronicle our family's adventures and travels. It's Prairie Dog Rustlers. I've put a post in regarding our trip to the Bisti Badlands, so check it out if you are interested. I'm going to try to get Alice and the kids to update it also.

AIG Bailout and what it costs me...

So the government in its wisdom has decided we need to bail out AIG to the tune of $85 billion. If you average that in over the approximately 300 million people in the country, it works out to a bill of ~$280 per person. So for a family of 6 like I have, I'm on the hook for $1680.

Of course if it was rolled out like this, there would be an uproar. Instead, we'll just let the Fed print more money. Now, instead of me paying directly, I'll do two things. I'll get fewer goods for my hard earned paycheck and I'll pass on more debt to my children.

Sigh.

A Look Backwards

I came across a reference to this speech by John F. Kennedy given to the New York Economic Club in 1962. While JFK is idolized by many on the center and left of today's electorate, his positions are anathema to what they do today. One could same the same of Reagan and the right of course...

I particularly enjoyed JFK's observations on the economy:

If we do not take action, those who have the most reason to be dissatisfied with our present rate of growth will be tempted to seek shortsighted and narrow solutions — to resist automation, to reduce the work week to 35 hours or even lower, to shut out imports, or to raise prices in a vain effort to obtain full capacity profits on under-capacity operations. But these are all self-defeating expedients which can only restrict the economy, not expand it.

Interesting that this saint of the left rails against the same type of "solution" that his descendants always propose.

He continues:

But the most direct and significant kind of federal action aiding economic growth is to make possible an increase in private consumption and investment demand — to cut the fetters which hold back private spending. In the past, this could be done in part by the increased use of credit and monetary tools, but our balance of payments situation today places limits on our use of those tools for expansion. It could also be done by increasing federal expenditures more rapidly than necessary, but such a course would soon demoralize both the government and our economy. If government is to retain the confidence of the people, it must not spend more than can be justified on grounds of national need or spent with maximum efficiency. And I shall say more on this in a moment. The final and best means of strengthening demand among consumers and business is to reduce the burden on private income and the deterrents to private initiative which are imposed by our present tax system — and this administration pledged itself last summer to an across-the-board, top-to-bottom cut in personal and corporate income taxes to be enacted and become effective in 1963.

I'm not talking about a "quickie" or a temporary tax cut, which would be more appropriate if a recession were imminent. Nor am I talking about giving the economy a mere shot in the arm, to ease some temporary complaint. I am talking about the accumulated evidence of the last five years that our present tax system, developed as it was, in good part, during World War II to restrain growth, exerts too heavy a
drag on growth in peace time; that it siphons out of the private economy too large a share of personal and business purchasing power; that it reduces the financial incenitives [sic] for personal effort, investment, and risk-taking. In short, to increase demand and lift the economy, the federal government's most useful role is not to rush into a program of excessive increases in public expenditures, but to expand the incentives and opportunities for private expenditures.

His prescription?

But you can understand that, under these circumstances, in general, that any new tax legislation enacted next year should meet the following three tests:
First, it should reduce the net taxes by a sufficiently early date and a sufficiently large amount to do the job required. Early action could give us extra leverage, added results, and important insurance against recession. Too large a tax cut, of course, could result in inflation and insufficient future revenues — but the greater danger is a tax cut too little, or too late, to be effective. Second, the new tax bill must increase private consumption, as well as investment. Consumers are still spending between 92 and 94 percent on their after-tax income, as they have every year since 1950. But that after-tax income could and should be greater, providing stronger markets for the products of American industry. When consumers purchase more goods, plants use more of their capacity, men are hired instead of laid-off, investment increases, and profits are high.

Corporate tax rates must also be cut to increase incentives and the availability of investment capital. The government has already taken major steps this year to reduce business tax liability and to stimulate the modernization, replacement, and expansion of our productive plant and equipment. We have done this through the 1962 investment tax credit and through the liberalization of depreciation allowances — two essential parts of our first step in tax revision — which amounted to a ten percent reduction in corporate income taxes worth 2.5 billion dollars. Now we need to increase consumer demand to make these measures fully effective — demand which will make more use of existing capacity and thus increase both profits and the incentive to invest. In fact, profits after taxes would be at least 15 percent higher today if we were operating at full employment.

Interesting that JFK was calling for larger profits and in effect condemning low profits. Compare this to the calls for higher taxes on "windfall profits". Now that very few companies actually make a profit, we need to punish those that do. Sigh.

Albuquerque's Finest

I'll comment on this later, but let me put the link up now. Watch the whole video for a disturbing look at how things are run in the Duke City.

New Candidate for Albuquerque Police Department Public Relations Officer

Man that cop knows how to steal a scene.

June Primary Preparation

So I finally did it. I've had the form sitting on my dresser for 5 months and haven't submitted it, but today I went down the the Sandoval County Bureau of Elections and registered as a Republican. My original party registration at 18 was Republican, but I changed to Libertarian shortly thereafter in disgust with the big-government policies of George H. W. Bush. I've generally voted libertarian since then, but see a real opportunity to do more than just thumb my nose at the system this June when I check the box for Ron Paul.

Yes, I know that he is not going to win. It's a shame that one of the key criteria people have in voting is whether or not they vote for a winner. You don't get a prize if you mark the right box. I'm actually excited to vote for the first time in a long time. It's refreshing to vote for someone who you actually want to be elected. It's also refreshing to see the grassroots activism that is shaking up the Republican Party.

Witness the fireworks in Nevada where party apparatchiks abruptly recessed the convention when it became apparent that RP supporters would be able to secure a majority of the national delegates. Throughout the primary process local groups supporting Paul have become active in their local parties. This lays the groundwork for shifting the base of the party in a direction more supportive of individual liberty, fiscal sanity and a moral foreign policy and away from the corrupt militarism of Bush and Cheney. It's nice to see a promise for productive change in the future.

The Compassion of Profits

The National Post has an interesting summary of a study of the responses to Hurricane Katrina. The gist of the study was that Wal Mart and other big box retailers provided the best immediate respose to the disaster. I don't necessarily enjoy shopping at Wal Mart, but I certainly am not one of these folks that condemns them at every opportunity. This has got to sting for Wal Mart's critics who contend that Wal Mart is an evil exploiter of the poor in America and worldwide.

Of particular interest to me was this comparison of government to enterprise:

Companies must, to survive, create economic value one way or another; government employees can increase their budgets and their personal power by destroying or wasting wealth, and most may do little else. Companies have price signals to guide their productive efforts; governments obfuscate those signal.

This point has always been ignored in my opinion. The idea that bureaucracies and governments act in some benevolent interest has always baffled me. Just because someone has a government title doesn't mean they will stop acting in their self interest. It only means that their actions have less accountability to the public. WalMart's success and FEMA's failure only serves to underscore this.

Paul and Huckabee

Doug Wead has a particularly insightful take on US presidential politics and the future they portend. He is spot on in his analysis that neither Paul nor Huckabee was necessarily in it for electoral victory. He points to the organizational benefits of extending a campaign in building a movement. His comparison of previous campaigns was particularly apt:

In years past, on the Democrat side, Black candidates have stuck around long after they should have pulled out, just to collect names. There was a reason. And in 1988, Evangelical Pat Robertson kept hanging on in his effort to win the Republican nomination.

I would point to the more recent Pat Buchanan interlude to the Republican party as evidence of this benefit. Pat's 1992 run for president could be considered quixotic from the get-go. Pat was able to gain a significant following and greatly increase his success in 1996.

Weade also makes a salient observation of the style of campaign that each ran or is running:

What’s next? Sometime, when all of this settles down, after McCain has not picked Mike Huckabee as his running mate, Huck will announce his Political Action Committee. We will hear a lot from Mike Huckabee next time around. His is a personal campaign.

And Ron Paul? His is a campaign of ideas. His enemies in the political arena and in the media will come to realize too late that they made a mistake by ignoring him this past election cycle. His army was left unchallenged on the battlefield. Now their ideas have taken root and they will grow.

Indeed, Paul's attraction to a substantial minority of Americans is precisely his emphasis on ideas. His is not a cult of personality, but rather a loose collection of individuals that value Paul for individual reasons. Paul doesn't make one feel good or comfortable. He in fact makes a good many people in his own party feel distinctly uncomfortable by taking a stand on issues at odds with the majority of his party, but based on the principles they claim to espouse. It is one thing to brush off a long haired hippy protesting the Iraq war, it is another thing entirely when an air force veteran, budget hawk, pro-life republican congressman vocally opposes it and uses the Republican president's words from his 2000 election campaign to sell his point.

I have to agree with Weade's conclusion:

Huckabee, will own the headlines for now. But Ron Paul owns the future.

We can hope.

Reefer Madness

I just read a terribly depressing account of Steve Tucker and his 10 year stint in the clink for selling lightbulbs. Steve and his brother ran a hydroponics supply shop and were effectively jailed because they didn't rat out their customers for buying legal gardening equipment. To me this reeks of the government's abusive responses in the Joseph Nacchio insider trading case where he is conveniently indicted on insider trading charges after refusing to play along with the feds in their desires to wiretap all of QWEST's customers. For that matter, one could easily point to Martha Stewart and her conviction for non-cooperation despite her acquittal on all original charges. In all three cases, the true reason behind conviction was not commission of any actual crimes, but rather a refusal to submit to the whims of the enforcer.

These are just large cases that have a considerable amount of publicity. The abuse of power by those in authority is just as egregious on a smaller scale as well. Sadly, I look at every encounter with a uniformed policeman with distrust and a certain sense of fear. In most cases, this is admittedly unjustified. Things happen just frequently enough to keep me in fear, though. Even a law-abiding teatotaller out doing good works can be put in his place.

2 years ago I got a call that someone in church was moving into a new home and was asked if I could spare an hour or two to unload a truck. I went to the address and met several other gentlemen from church. The truck hadn't arrived yet, so the 5 of us waited on the sidewalk and talked. A short time later the police arrived upon a neighbor's call that suspicious characters were loitering in the neighborhood. The police arrived and asked our business. When told that we were waiting to help someone move in across the street, the cops insisted we call the family en route. At this point I had the audacity to ask what we were doing that was illegal and why we needed permission from someone else to stand on the sidewalk in the same city in which we paid taxes. After this, the policeman threatened me with "if you don't stop mouthing off to me, I'll start writing tickets for your friend's vehicle". As a courtesy to my friend, I stopped asking questions and we called the family and the cops left without even an apology for accosting us. The most galling part of the event to me was when I called the Milpitas Police Department later that night to complain and was told by the officer in charge that nothing was done wrong and that I was essentially unjustified in my objections. Protect and Serve obviously refers primarily to the good old boys and not to the public. On all levels, it is generally more of us vs. them than right vs. wrong.

In hindsight, I guess I got off lucky. If the cops knew there were lightbulbs in the moving van, I might still be in prison.

Savings Rates in America

I read a snippet by Laura Rowley in Yahoo Finance this morning bemoaning the savings rates in the US. The article states that:

While three-quarters of Americans report that they save something, half put away only 5 percent or less of their income. Forty-three percent say they aren't saving enough to maintain a desirable living standard in retirement.

My thought was that 50% socking away less than 5% was not a bad thing. I considered the 13% (6.5% each from employee and employer) enforced "savings" of social security and this looks pretty good. Unfortunately social security payments cant really be considered savings since you have no control over the money once it is extracted from your paycheck. Indeed, a good portion of the working populace is being told today to not expect anything out of social security. If savings is such a boon and a desirable trait, allowing workers to opt out of social security would be a great place to start.

Movie Review: Seoul Train

I streamed a documentary from Netflix the other night: Seoul Train. The movie was a very low budget documentary discussing the plight of North Korean refugees in China. Part of me wishes that the movie had better production quality and a more coherent thesis, but nonetheless, it is an eye opening movie. While the movie fails to provide any suggested path for resolution, it does a pretty good job of saying "Life sucks if you are a North Korean in China." Indeed life pretty much sucks for all North Koreans. What I didn't like was the constant bloviating politician interviews that peppered the short film. How many politicians do you have to see a)talking about how we need to do something b) pass the buck c) talk around a problem. I don't particularly want to see these guys get involved any more than they have too. For politicians of these countries (yes you Sam Brownback) that wish to do something about these human rights issues, why not let it be known to the underground railroad in question that you will assist them in entering the embassy or consulate nearest them and that you will grant asylum or allow for expatriation to South Korea upon request.

It is terrible that we (China, the US, South Korea, et. al.) pretend that these people are merely economic migrants merely to avoid making Kim Jong Il mad. We don't need to have our government solve the problem, but we can certainly expect that our governments not aid the bad guy in this (Kim Jong Il). The movie recommends doing the usual tripe of "writing your congressman" or "writing to the UN". Really, I think the members of the underground railroad and their benefactors are doing much more than this by acting directly instead of hoping for government to solve their problems.

The movie is less than and hour and available to stream from Netflix. I notice that it is showing on TMC in March as well. You will see many better documentaries technically, but there are not a lot of documentaries on this subject. Check it out and broaden your horizons. If you know of other documentaries on the subject, drop a comment.

Introductions

Introductions--Postings on this blog will be sporadic and hopefully a way to keep updates on what's going on in my world. Expect rambling diatribes against idiocy, comments on good food, funny stories and stuff that strikes me as interesting. Comments welcome for now, but not guaranteed to be monitored or reviewed with any frequency.