"A rose is a rose is a rose, and by any other name it would still smell." -- Gertrude Stein
We don't buy stuff. We have a purchasing experience.
Concept marketers often change words and phrases, usually from plain English to longer, Latin-based words in attempts to make some crude or costly more acceptable.
Examples: A gas company just sent a notice to customers advising that we will no longer get monthly charges. Instead, we will be provided with "an exciting billing experience."
We no longer buy a used car. Instead, we acquire a "previously owned vehicle" through a pleasant "purchasing experience."
We don't eat out. We have a "splendid dining experience."
Hippies don't get stoned. They have "a pharmaceutical experience."
Government agents don't use torture. They utilize "enhanced interrogation techniques."
When you redefine your term, you can define it out of existence.
Tell that to the Spanish Inquisition, when they redefined their techniques so that anything short of bloodletting was an acceptable means of squeezing out a confession.
But then, the CIA would hardly expect to be compared to the Spanish Inquisition.
Nobody expects that.
Friday, December 26, 2014
Wordsmithing
Words are tools. They can be use to help or hurt, educate or eliminate, propagate or punish, amuse or attack, calm or chasten in as many ways as there are word combinations in any language.
Writing is also hard work, and anyone who says otherwise is delusional. There are a few, however, to whom ideas come early and easily, and these folks are able to transfer their thoughts and ideas to paper in a reasonably coherent fashion. But they are a rare few.
Most of us struggle to snatch ideas from our mental ether and then struggle further with the procession of expanding and organizing an idea and related thoughts and concepts to paper.
Some can verbalize extemporaneously, which can sound good while they're talking, but often this process is merely being glib. If you sound like you know what you're talking about, people will assume you do. Not always a valid assumption, since the talkers may be just "Blowing Smoke." (Note the capitalized letters.)
Writing is also hard work, and anyone who says otherwise is delusional. There are a few, however, to whom ideas come early and easily, and these folks are able to transfer their thoughts and ideas to paper in a reasonably coherent fashion. But they are a rare few.
Most of us struggle to snatch ideas from our mental ether and then struggle further with the procession of expanding and organizing an idea and related thoughts and concepts to paper.
Some can verbalize extemporaneously, which can sound good while they're talking, but often this process is merely being glib. If you sound like you know what you're talking about, people will assume you do. Not always a valid assumption, since the talkers may be just "Blowing Smoke." (Note the capitalized letters.)
Wednesday, December 24, 2014
Great American Novels
"A house divided against itself cannot stand." -- Abraham Lincoln
"Can't we all just get along?" -- Rodney King
"The" Great American Novel has not yet been written, and probably never will be. Why? Because America is too diverse. It has been called a "Great Melting Pot," suggesting that all who come here adapt and become like all others already here. But that has not happened.
America is instead a "Great Tapestry," with many regions and cultures developing and retaining their own customs, appearances and beliefs. To expect a single novel to cover all these segments in a single book perhaps is too much to seek. It's possible, of course, but while America is indeed "one nation," daily reports of ethnic, religious, cultural and racial clashes show that it is not "indivisible."
Meanwhile, there are already several Great American Novels, each dealing with one region or cultural group, and sometimes its clashes with another group, or its efforts to mesh with a dominant group in its area.
Here are some examples, in no particular order of merit or importance: "The Godfather," by Mario Puzo; "Gone With the Wind," by Margaret Mitchell; "The Jungle," by Upton Sinclair; "Grapes of Wrath," by John Steinbeck; "Huckleberry Finn," by Mark Twain; "A Confederacy of Dunces," by John Kennedy Toole; "I Know Why the Caged Bird Sings," by Maya Angelou; "To Kill a Mockingbird," by Harper Lee.
There are many others, of course, that are candidates for this very incomplete list, just as there are many cultures that make up the Great American Tapestry.
Each is A Great Novel, and each tells great truths about individuals, groups and cultures in various social, regional and economic areas. But all are vastly different, just as various parts of America are vastly different. No single one represents every area or aspect -- social, geographic or cultural -- of American life. Nor should we expect it to.
"Can't we all just get along?" -- Rodney King
"The" Great American Novel has not yet been written, and probably never will be. Why? Because America is too diverse. It has been called a "Great Melting Pot," suggesting that all who come here adapt and become like all others already here. But that has not happened.
America is instead a "Great Tapestry," with many regions and cultures developing and retaining their own customs, appearances and beliefs. To expect a single novel to cover all these segments in a single book perhaps is too much to seek. It's possible, of course, but while America is indeed "one nation," daily reports of ethnic, religious, cultural and racial clashes show that it is not "indivisible."
Meanwhile, there are already several Great American Novels, each dealing with one region or cultural group, and sometimes its clashes with another group, or its efforts to mesh with a dominant group in its area.
Here are some examples, in no particular order of merit or importance: "The Godfather," by Mario Puzo; "Gone With the Wind," by Margaret Mitchell; "The Jungle," by Upton Sinclair; "Grapes of Wrath," by John Steinbeck; "Huckleberry Finn," by Mark Twain; "A Confederacy of Dunces," by John Kennedy Toole; "I Know Why the Caged Bird Sings," by Maya Angelou; "To Kill a Mockingbird," by Harper Lee.
There are many others, of course, that are candidates for this very incomplete list, just as there are many cultures that make up the Great American Tapestry.
Each is A Great Novel, and each tells great truths about individuals, groups and cultures in various social, regional and economic areas. But all are vastly different, just as various parts of America are vastly different. No single one represents every area or aspect -- social, geographic or cultural -- of American life. Nor should we expect it to.
Saturday, December 13, 2014
Animation
Pope Francis made Page One news when he assured a boy whose dog had died that "Paradise is open to all God's creatures." Therefore, dogs may well go to Heaven.
The problem, for some experts on church teaching, is that this contradicts the long-held official policy that animals don't have souls, and therefore cannot go to heaven.
Except for the idea that the word "animal" is derived from the Latin "anima," which means soul or spirit.
So regardless of what the ecclesiastical academic "experts" may claim, anyone who has loved and been loved by a dog, cat, or any other creature who is animated by breathing, the spirit of life, knows better.
And for those who feel they need it, they now have official confirmation by the Pope.
The problem, for some experts on church teaching, is that this contradicts the long-held official policy that animals don't have souls, and therefore cannot go to heaven.
Except for the idea that the word "animal" is derived from the Latin "anima," which means soul or spirit.
So regardless of what the ecclesiastical academic "experts" may claim, anyone who has loved and been loved by a dog, cat, or any other creature who is animated by breathing, the spirit of life, knows better.
And for those who feel they need it, they now have official confirmation by the Pope.
Friday, December 5, 2014
Standalone Economy
The U.S. economy is improving, but stormy winds still blow across Europe and Asia. So the question becomes this: Can the U.S. go it alone as a self-contained system, immune from economic infection from the rest of the world?
American workers found more jobs last month, increasing payrolls across the country by 231,000, with the unemployment rate below 6 percent. Along with this, the housing market is responding with positive signs as families feel more secure with their jobs and income.
Exports from American firms rose by $2.3 billion in October from the month before, outpacing the dollar value of imports. Result: A reduction in the international trade deficit.
The Federal Reserve reported that national economic activity continued to expand in October and November. Separately, sales of new single-family homes totaled 458,000 in October, up 0.7 percent from September and up 1.8 percent from a year ago, according to the U.S. Bureau of Economic Analysis. And personal income increased 0.2 percent, with spending rising at the same rate, the government said.
Overall, GDP in America -- the total value of goods and services -- increased at an annual rate of 3.9 percent, according to government statistics.
And now here comes the but. The 18 nations of the European Union are still struggling to achieve solid economic growth, and the European Central Bank said it will try again to stimulate the stalled economy. Central banks in Japan and England have already been attempting to boost growth by making more money available, thus lowering interest rates. One problem, of course, is that interest rates are already near zero in those countries, and there is the danger that more money will only raise prices -- also known as inflation. Moreover, in many parts of the world, this tactic isn't working.
In America, the Federal Reserve has drawn interest rates down to near zero, and the Fed has suggested it may pull back from its "quantitative easing" as the economy recovers. The economy does seem to be recovering, but whether it's doing so on its own or as a result of Fed actions may be arguable.
Now back to the question. Can the U.S. continue its upward trend as a standalone economy? And is it strong enough to build not only its own strength but that of the rest of the world as well?
True, U.S. exports have been increasing faster than imports, which means that American firms and consumers are selling more stuff than they buy. This, of course, is good for America, but if other nations flag their purchasing rate even as U.S. firms trim their own, the result can only be trouble.
A related issue is inflation. A little bit is a good thing, according to conventional economic wisdom, since it encourages people to buy now before the price goes even higher. But when the reverse happens and deflation -- meaning lower prices -- sets in people tend to hold off on purchases in the expectation that prices will fall even further. This is especially true when jobs are scarce.
Superpatriots will wave the flag and insist that they don't need anyone else in order to prosper. Close the borders, they say, and we'll bootstrap ourselves to prosperity. However, history teaches otherwise. And those who do not learn from history are condemned to repeat it. Remember the Smoot-Hawley Act, which erected stiff tariff walls to protect American producers? Unfortunately, many other countries did the same, and the result was a worldwide Great Depression.
American workers found more jobs last month, increasing payrolls across the country by 231,000, with the unemployment rate below 6 percent. Along with this, the housing market is responding with positive signs as families feel more secure with their jobs and income.
Exports from American firms rose by $2.3 billion in October from the month before, outpacing the dollar value of imports. Result: A reduction in the international trade deficit.
The Federal Reserve reported that national economic activity continued to expand in October and November. Separately, sales of new single-family homes totaled 458,000 in October, up 0.7 percent from September and up 1.8 percent from a year ago, according to the U.S. Bureau of Economic Analysis. And personal income increased 0.2 percent, with spending rising at the same rate, the government said.
Overall, GDP in America -- the total value of goods and services -- increased at an annual rate of 3.9 percent, according to government statistics.
And now here comes the but. The 18 nations of the European Union are still struggling to achieve solid economic growth, and the European Central Bank said it will try again to stimulate the stalled economy. Central banks in Japan and England have already been attempting to boost growth by making more money available, thus lowering interest rates. One problem, of course, is that interest rates are already near zero in those countries, and there is the danger that more money will only raise prices -- also known as inflation. Moreover, in many parts of the world, this tactic isn't working.
In America, the Federal Reserve has drawn interest rates down to near zero, and the Fed has suggested it may pull back from its "quantitative easing" as the economy recovers. The economy does seem to be recovering, but whether it's doing so on its own or as a result of Fed actions may be arguable.
Now back to the question. Can the U.S. continue its upward trend as a standalone economy? And is it strong enough to build not only its own strength but that of the rest of the world as well?
True, U.S. exports have been increasing faster than imports, which means that American firms and consumers are selling more stuff than they buy. This, of course, is good for America, but if other nations flag their purchasing rate even as U.S. firms trim their own, the result can only be trouble.
A related issue is inflation. A little bit is a good thing, according to conventional economic wisdom, since it encourages people to buy now before the price goes even higher. But when the reverse happens and deflation -- meaning lower prices -- sets in people tend to hold off on purchases in the expectation that prices will fall even further. This is especially true when jobs are scarce.
Superpatriots will wave the flag and insist that they don't need anyone else in order to prosper. Close the borders, they say, and we'll bootstrap ourselves to prosperity. However, history teaches otherwise. And those who do not learn from history are condemned to repeat it. Remember the Smoot-Hawley Act, which erected stiff tariff walls to protect American producers? Unfortunately, many other countries did the same, and the result was a worldwide Great Depression.
Wednesday, November 19, 2014
Recession Curatives
"It's all about stuff." -- George Carlin
Prices rise to absorb the amount of money available. Ask any tourist.
An economy, simplistically put, is the production and trading of stuff.
Here's a lesson from the George Carlin School of Economics. I got stuff; you got stuff. Let's trade. I want some of your stuff because you have extra, but I don't have the kind of stuff you want. OK, let's invent money, so I can buy your stuff and you can buy what you want from other people.
A recession, also known as an economic downturn, happens when total output of goods and services in a country declines for two consecutive fiscal quarters. People stop producing, selling and buying stuff, and one way to change that is to make sure prices are low enough and people have money enough to get back in the game.
Recessions happen when consumers stop spending and companies stop investing (spending) on production.
There are several ways to fix that:
One/ Reduce prices and/or interest rates, so consumers and firms can better afford to buy more stuff.
Two/ Increase the amount of money available, which will lower interest rates. However, that can boost prices, putting stuff further out of reach of consumers. It's called inflation.
Three/ If consumers and firms don't respond to the first two measures, government can step in, buying more stuff and investing in projects, thus putting people to work so they in turn have money to buy stuff on their own.
In the past, the accepted wisdom was to leave the economy alone, and it will work itself through the cycle and eventually revive. We should live so long.
Another strategy is for government to cut spending and raise taxes, as a way of reducing its debt, on the premise that government debt is a bad thing. Or is it? Both actions slow the money flow, and while that may be a good thing for a government, it's bad for consumers and firms, since a reduction in spending cuts worker income, and higher taxes cut into company profits, making them less able to borrow and invest in production capacity.
Recent experience in Japan shows that strategy doesn't work, and it sent that nation's economy back into recession.
How about cutting spending as well as taxes? That, however, trims government money flow, which in turn reduces its ability to contribute to recovery.
How about raising both? By increasing spending as well as taxes, a government could help consumers but at the same time it would harm companies.
Consider option three: Increase government spending and reduce taxes. That would certainly put government further into debt, but it would help both consumers and firms. Then, when the economy recovers, government can revise its strategy by stepping back, lowering spending as the private sector regains strength, and raising taxes so it can pay down the debt incurred in reviving the economy.
The trick is in knowing when to do that, so government efforts don't crowd out company efforts to take advantage of low interest rates and increase their investment.
Taking money out of the economic flow may enrich government officials and reduce government debt, but the rest of the economic population -- consumers and companies -- are reduced.
Prices rise to absorb the amount of money available. Ask any tourist.
An economy, simplistically put, is the production and trading of stuff.
Here's a lesson from the George Carlin School of Economics. I got stuff; you got stuff. Let's trade. I want some of your stuff because you have extra, but I don't have the kind of stuff you want. OK, let's invent money, so I can buy your stuff and you can buy what you want from other people.
A recession, also known as an economic downturn, happens when total output of goods and services in a country declines for two consecutive fiscal quarters. People stop producing, selling and buying stuff, and one way to change that is to make sure prices are low enough and people have money enough to get back in the game.
Recessions happen when consumers stop spending and companies stop investing (spending) on production.
There are several ways to fix that:
One/ Reduce prices and/or interest rates, so consumers and firms can better afford to buy more stuff.
Two/ Increase the amount of money available, which will lower interest rates. However, that can boost prices, putting stuff further out of reach of consumers. It's called inflation.
Three/ If consumers and firms don't respond to the first two measures, government can step in, buying more stuff and investing in projects, thus putting people to work so they in turn have money to buy stuff on their own.
In the past, the accepted wisdom was to leave the economy alone, and it will work itself through the cycle and eventually revive. We should live so long.
Another strategy is for government to cut spending and raise taxes, as a way of reducing its debt, on the premise that government debt is a bad thing. Or is it? Both actions slow the money flow, and while that may be a good thing for a government, it's bad for consumers and firms, since a reduction in spending cuts worker income, and higher taxes cut into company profits, making them less able to borrow and invest in production capacity.
Recent experience in Japan shows that strategy doesn't work, and it sent that nation's economy back into recession.
How about cutting spending as well as taxes? That, however, trims government money flow, which in turn reduces its ability to contribute to recovery.
How about raising both? By increasing spending as well as taxes, a government could help consumers but at the same time it would harm companies.
Consider option three: Increase government spending and reduce taxes. That would certainly put government further into debt, but it would help both consumers and firms. Then, when the economy recovers, government can revise its strategy by stepping back, lowering spending as the private sector regains strength, and raising taxes so it can pay down the debt incurred in reviving the economy.
The trick is in knowing when to do that, so government efforts don't crowd out company efforts to take advantage of low interest rates and increase their investment.
Taking money out of the economic flow may enrich government officials and reduce government debt, but the rest of the economic population -- consumers and companies -- are reduced.
Tuesday, November 18, 2014
Word Power
Words carry power. When used too often, however, their strength is weakened. How often is too often? When the reader or listener notices that a particular word or phrase is being used repeatedly.
Weather reporters become enamored of the phrase "Arctic blast." Recently, "iconic" has popped up as many as three times in a five-minute time frame.
Maybe someone could invent an "iconograph" to count the number of times a word or phrase is used by TV or radio folk.
Repetition for emphasis is one thing; it's a useful rhetorical device. When it becomes redundancy, however, it diminishes the power of the word.
Word power can also be used to diminish one person's abilities while leaving out similar characteristics of another.
Example: Some Republican political operatives have been warning that Hillary Clinton, if elected in 2016, would be the "second oldest President in history."
This a true statement about the potential Democratic candidate. However, such a warning implies that age is a disabling factor.
Moreover, the warning does not mention who the oldest President was. That would be Ronald Reagan, the GOP idol who took office Jan. 20, 1981, just two weeks shy of his 70th birthday. It also does not mention that Reagan was suffering from dementia toward the end of his second term.
Hillary Clinton would indeed be the second oldest President, if elected. She was born Oct. 26, 1947, and on Election Day 2016, she will have just turned 69.
Is any of this relevant? That's for voters to decide. However, as Reagan himself said during a pre-election debate, he had no intention of criticizing his opponent's "youth and inexperience."
Weather reporters become enamored of the phrase "Arctic blast." Recently, "iconic" has popped up as many as three times in a five-minute time frame.
Maybe someone could invent an "iconograph" to count the number of times a word or phrase is used by TV or radio folk.
Repetition for emphasis is one thing; it's a useful rhetorical device. When it becomes redundancy, however, it diminishes the power of the word.
Word power can also be used to diminish one person's abilities while leaving out similar characteristics of another.
Example: Some Republican political operatives have been warning that Hillary Clinton, if elected in 2016, would be the "second oldest President in history."
This a true statement about the potential Democratic candidate. However, such a warning implies that age is a disabling factor.
Moreover, the warning does not mention who the oldest President was. That would be Ronald Reagan, the GOP idol who took office Jan. 20, 1981, just two weeks shy of his 70th birthday. It also does not mention that Reagan was suffering from dementia toward the end of his second term.
Hillary Clinton would indeed be the second oldest President, if elected. She was born Oct. 26, 1947, and on Election Day 2016, she will have just turned 69.
Is any of this relevant? That's for voters to decide. However, as Reagan himself said during a pre-election debate, he had no intention of criticizing his opponent's "youth and inexperience."
Reporter's Creed
"There are no dumb questions; only dumb answers."
In the world of free, unfettered journalism, any reporter or interviewer can ask any question of any official at any time, following the above guideline and hoping to lure the interviewee into saying something newsworthy.
In fact, that guideline is not true: There are indeed dumb questions, often born of ignorance. However, while ignorance may explain the problem, it does not excuse it, especially when perpetrated by alleged professionals.
Example: Two government tourism officials from the Republic of Ireland were asked by a Boston-based TV host -- whose program is syndicated to several hundred stations --
whether Ireland had any plans to leave the United Kingdom, following the vote on the issue taken in Scotland.
Example 2: Another TV host asked the same Irish officials why Ireland uses the euro as its monetary base, rather than sterling as do England and Scotland. "It's part of the same island, isn't it?" said the host.
Quick geography and history lesson: Ireland is an island of itself, and not connected to the other island that comprises England and Scotland. Moreover, Ireland never was part of the United Kingdom, any more than was Canada, Australia, India or any of the other possessions of the British empire. Ireland had, indeed, been part of the British empire, but Ireland left nearly 100 years ago, beginning with the Easter Rising of 1916.
To their credit, the Irish officials sidestepped the questions. Government, corporate and political folks often do that, either because they don't want to answer the question, or because they don't want to embarrass or insult the alleged journalist for asking a dumb question and risk being called a bully.
In the world of free, unfettered journalism, any reporter or interviewer can ask any question of any official at any time, following the above guideline and hoping to lure the interviewee into saying something newsworthy.
In fact, that guideline is not true: There are indeed dumb questions, often born of ignorance. However, while ignorance may explain the problem, it does not excuse it, especially when perpetrated by alleged professionals.
Example: Two government tourism officials from the Republic of Ireland were asked by a Boston-based TV host -- whose program is syndicated to several hundred stations --
whether Ireland had any plans to leave the United Kingdom, following the vote on the issue taken in Scotland.
Example 2: Another TV host asked the same Irish officials why Ireland uses the euro as its monetary base, rather than sterling as do England and Scotland. "It's part of the same island, isn't it?" said the host.
Quick geography and history lesson: Ireland is an island of itself, and not connected to the other island that comprises England and Scotland. Moreover, Ireland never was part of the United Kingdom, any more than was Canada, Australia, India or any of the other possessions of the British empire. Ireland had, indeed, been part of the British empire, but Ireland left nearly 100 years ago, beginning with the Easter Rising of 1916.
To their credit, the Irish officials sidestepped the questions. Government, corporate and political folks often do that, either because they don't want to answer the question, or because they don't want to embarrass or insult the alleged journalist for asking a dumb question and risk being called a bully.
Thursday, November 13, 2014
Xenophobia
We are all foreigners.
Foreigners have long been blamed for economic problems, and fear of them has hatched many a plot to keep them out of a country in the hope that doing so would revive prosperity.
In America, however, unless you are a member of one of the recognized tribes, you are a foreigner. But how many generations must pass before one can claim to be a "native"? Even members of the tribes are descended from people who migrated here across a land bridge from Asia to Alaska and then southward.
In Europe these days, European Union rules stipulate free movement of citizens from one country to another. In Britain, however, many blame current problems on newcomers, especially those from Eastern Europe -- people trying to escape poverty and economic distress by moving to a land of opportunity. Sound familiar?
But even those in the UK are descended from immigrants, as far back as the Norman Conquest, with invaders whose members were in a sense Frenchified Vikings. And before that, the Anglo-Saxons migrated from northeastern Germany, overpowering the Celtic peoples who had moved to the islands from what is now Spain.
It turns out also that many of the monarchs of England were not themselves English. The Norman (Norse-man) conquerors spoke French, the Tudor monarchs (e.g. Henry VIII) were Welsh, the King James who followed Elizabeth had been king of Scotland for a dozen or more years before he united the two kingdoms, the King William who presided over the rebellious Irish was imported to England from Holland, the Hanoverians were German (e.g. George III, at the time the American colonies declared their independence, barely spoke English at all), and Queen Victoria and her children routinely spoke German at home, as a courtesy to her spouse, Prince Albert of Saxe-Coburg and Gotha.
The history of America, indeed the history of the entire world, is that of the movement of peoples from one region to another for a host of reasons, ranging from a search for opportunity to a goal of conquest.
In the American Southwest, non-Hispanics are trying to block the movement of people from Mexico into areas they consider "theirs." They seem to have forgotten that Texas -- and areas that are now states -- used to be part of Mexico, and the non-Hispanics in Texas immigrated to that area and fought a war of independence in the mid-19th Century.
Sidelight: A federal court has overturned a law in Arizona that required people to carry documentation to prove their right to be in that state, and therefore were not illegal immigrants.
But how many people routinely carry documents proving their citizenship? A driver's license isn't enough. And many spend their entire lives in America without a passport and don't carry a certified copy of their birth certificate with them at all times.
Foreigners have long been blamed for economic problems, and fear of them has hatched many a plot to keep them out of a country in the hope that doing so would revive prosperity.
In America, however, unless you are a member of one of the recognized tribes, you are a foreigner. But how many generations must pass before one can claim to be a "native"? Even members of the tribes are descended from people who migrated here across a land bridge from Asia to Alaska and then southward.
In Europe these days, European Union rules stipulate free movement of citizens from one country to another. In Britain, however, many blame current problems on newcomers, especially those from Eastern Europe -- people trying to escape poverty and economic distress by moving to a land of opportunity. Sound familiar?
But even those in the UK are descended from immigrants, as far back as the Norman Conquest, with invaders whose members were in a sense Frenchified Vikings. And before that, the Anglo-Saxons migrated from northeastern Germany, overpowering the Celtic peoples who had moved to the islands from what is now Spain.
It turns out also that many of the monarchs of England were not themselves English. The Norman (Norse-man) conquerors spoke French, the Tudor monarchs (e.g. Henry VIII) were Welsh, the King James who followed Elizabeth had been king of Scotland for a dozen or more years before he united the two kingdoms, the King William who presided over the rebellious Irish was imported to England from Holland, the Hanoverians were German (e.g. George III, at the time the American colonies declared their independence, barely spoke English at all), and Queen Victoria and her children routinely spoke German at home, as a courtesy to her spouse, Prince Albert of Saxe-Coburg and Gotha.
The history of America, indeed the history of the entire world, is that of the movement of peoples from one region to another for a host of reasons, ranging from a search for opportunity to a goal of conquest.
In the American Southwest, non-Hispanics are trying to block the movement of people from Mexico into areas they consider "theirs." They seem to have forgotten that Texas -- and areas that are now states -- used to be part of Mexico, and the non-Hispanics in Texas immigrated to that area and fought a war of independence in the mid-19th Century.
Sidelight: A federal court has overturned a law in Arizona that required people to carry documentation to prove their right to be in that state, and therefore were not illegal immigrants.
But how many people routinely carry documents proving their citizenship? A driver's license isn't enough. And many spend their entire lives in America without a passport and don't carry a certified copy of their birth certificate with them at all times.
Tuesday, November 11, 2014
Mandate
"Figures don't lie, but liars do figure." -- Mark Twain.
By choosing which set of numbers to use and redefining the ways they are used, anyone can "prove" anything.
Selectivity in data can be misleading at best, and propaganda at worst.
Republicans claim the recent election results gave them a mandate.
But with a turnout of only one out of three voters, can it really be called a mandate? Moreover, a mandate to do what? To follow the path of obstructionism of the past few years? Or if the so-called mandate is an endorsement of a GOP program for progress, just what is that program?
Second question: When two-thirds of the electorate don't bother to show up, what does that say about the absentees' attitude toward government and its performance? In brief, it speaks to the lack of confidence in the system.
Pundits have been calling the results a "drubbing" of Democratic candidates, but that's not universally true. In Pennsylvania, a Democratic candidate for governor -- a business exec with no history of elected office -- defeated a Republican incumbent. And in New Jersey, the Democratic senator named in a special election practically walked his way to election for a full term.
Statisticians speak of sample size in any poll, and when the sample is too small, they do not guarantee the accuracy of the conclusions. In this case, when only one-third of those eligible to vote even show up, and two-thirds fail to participate, that puts into question the validity of any conclusions.
One conclusion would be that Republican victories were the result of conservative supporters of partisan politics showing up in greater numbers than moderates or liberals. Another conclusion could be that many potential voters were disillusioned with the political system and decided that it was pointless to participate in something that reeked of hypocrisy. A third factor to note is that mid-term elections typically attract fewer voters.
Or as Archie Bunker once put it, "I save my vote for the really important ones, like the presidential, the senatorial, and the mayororial."
Put another way, if you didn't vote, you can't complain about the results.
By choosing which set of numbers to use and redefining the ways they are used, anyone can "prove" anything.
Selectivity in data can be misleading at best, and propaganda at worst.
Republicans claim the recent election results gave them a mandate.
But with a turnout of only one out of three voters, can it really be called a mandate? Moreover, a mandate to do what? To follow the path of obstructionism of the past few years? Or if the so-called mandate is an endorsement of a GOP program for progress, just what is that program?
Second question: When two-thirds of the electorate don't bother to show up, what does that say about the absentees' attitude toward government and its performance? In brief, it speaks to the lack of confidence in the system.
Pundits have been calling the results a "drubbing" of Democratic candidates, but that's not universally true. In Pennsylvania, a Democratic candidate for governor -- a business exec with no history of elected office -- defeated a Republican incumbent. And in New Jersey, the Democratic senator named in a special election practically walked his way to election for a full term.
Statisticians speak of sample size in any poll, and when the sample is too small, they do not guarantee the accuracy of the conclusions. In this case, when only one-third of those eligible to vote even show up, and two-thirds fail to participate, that puts into question the validity of any conclusions.
One conclusion would be that Republican victories were the result of conservative supporters of partisan politics showing up in greater numbers than moderates or liberals. Another conclusion could be that many potential voters were disillusioned with the political system and decided that it was pointless to participate in something that reeked of hypocrisy. A third factor to note is that mid-term elections typically attract fewer voters.
Or as Archie Bunker once put it, "I save my vote for the really important ones, like the presidential, the senatorial, and the mayororial."
Put another way, if you didn't vote, you can't complain about the results.
Friday, November 7, 2014
Austerity and the Paradox of Thrift
When everyone saves, no one spends, and the economy stalls.
Thrift is a good thing. Except that when everybody does it, in its most extreme and widespread form, it can paralyze an entire nation.
Austerity is a good thing. Except when everyone does it, the cycle of sales and purchases slows and the money flow stops.
Money is the lifeblood of an economy. But when the lifeblood stops flowing, as with austerity and excessive thrift, the economic body suffers and sickens. The cure, then, is for someone to start spending again.
In any economy, there are three main drivers to the money flow (the cycle of buying and selling): Consumers, companies and government. During a recession, consumers stop buying and companies stop investing. Consumers trim their spending because many have lost their jobs. Companies cut back because sales to consumers are down, and there's no point to expanding production or even maintaining the same level of output. The cycle thus feeds on itself and continues downward.
Austerity by a family or even a household of just one or two persons is justified by its lack of income and fear of worse times to come. A company scales back production as sales decline, justified by the idea that there's no reason to produce if few are buying.
On a small scale -- an individual household or a single company -- this scenario is appropriate. But on a regional or national scale, this same scenario becomes a self-perpetuating disaster.
So if consumers and companies cannot or will not spend, boosting the economic lifeblood, that leaves only government -- the third pillar of an economy -- to step in to provide jobs, in turn providing income to workers, who then use that income to buy food, clothing and shelter. Or, succinctly put, your spending is my income, and my spending is another's income. And so the flow goes on, irrigating the economic field and encouraging growth and health.
But if government also follows the austerity path, even more workers lose their income, which means fewer purchases and lower sales of necessities as well as luxury goods.
So is austerity the answer when hard times hit? For an individual person or a family household, or for a single firm, yes, as long as other workers and companies continue to contribute to the money flow.
But when government refuses to contribute to the money flow, often through such investments as public works construction of roads and bridges, for example, thus putting people to work so they have money to spend, this can only diminish the money flow, and everyone suffers.
Worse, when government not only practices austerity itself but also insists that others do the same, the cycle drags everyone down in a depressing economy.
But a balanced budget is important, and staying within that budget is important, you say. And this is true, especially for individuals, households and single companies.
It's also true, however, that individuals go into debt to invest in education to increase their skills, and companies go into debt to invest in more production capacity. Likewise, a government can and should go into debt to provide jobs and income to increase the efficiency of the national system and enable companies and their workers to prosper.
Then, when the national economy returns to health, government can and should step back, allowing the private sector to thrive on its own.
The current question is whether government spending has crowded out private sector borrowing for production and expansion. One answer is that if the private sector is not producing and expanding, government can and should intervene.
So far, it seems that the private sector is ready. Almost. However, government must be cautious as it withdraws. To do so precipitously may send the economy over the cliff -- again.
Thrift is a good thing. Except that when everybody does it, in its most extreme and widespread form, it can paralyze an entire nation.
Austerity is a good thing. Except when everyone does it, the cycle of sales and purchases slows and the money flow stops.
Money is the lifeblood of an economy. But when the lifeblood stops flowing, as with austerity and excessive thrift, the economic body suffers and sickens. The cure, then, is for someone to start spending again.
In any economy, there are three main drivers to the money flow (the cycle of buying and selling): Consumers, companies and government. During a recession, consumers stop buying and companies stop investing. Consumers trim their spending because many have lost their jobs. Companies cut back because sales to consumers are down, and there's no point to expanding production or even maintaining the same level of output. The cycle thus feeds on itself and continues downward.
Austerity by a family or even a household of just one or two persons is justified by its lack of income and fear of worse times to come. A company scales back production as sales decline, justified by the idea that there's no reason to produce if few are buying.
On a small scale -- an individual household or a single company -- this scenario is appropriate. But on a regional or national scale, this same scenario becomes a self-perpetuating disaster.
So if consumers and companies cannot or will not spend, boosting the economic lifeblood, that leaves only government -- the third pillar of an economy -- to step in to provide jobs, in turn providing income to workers, who then use that income to buy food, clothing and shelter. Or, succinctly put, your spending is my income, and my spending is another's income. And so the flow goes on, irrigating the economic field and encouraging growth and health.
But if government also follows the austerity path, even more workers lose their income, which means fewer purchases and lower sales of necessities as well as luxury goods.
So is austerity the answer when hard times hit? For an individual person or a family household, or for a single firm, yes, as long as other workers and companies continue to contribute to the money flow.
But when government refuses to contribute to the money flow, often through such investments as public works construction of roads and bridges, for example, thus putting people to work so they have money to spend, this can only diminish the money flow, and everyone suffers.
Worse, when government not only practices austerity itself but also insists that others do the same, the cycle drags everyone down in a depressing economy.
But a balanced budget is important, and staying within that budget is important, you say. And this is true, especially for individuals, households and single companies.
It's also true, however, that individuals go into debt to invest in education to increase their skills, and companies go into debt to invest in more production capacity. Likewise, a government can and should go into debt to provide jobs and income to increase the efficiency of the national system and enable companies and their workers to prosper.
Then, when the national economy returns to health, government can and should step back, allowing the private sector to thrive on its own.
The current question is whether government spending has crowded out private sector borrowing for production and expansion. One answer is that if the private sector is not producing and expanding, government can and should intervene.
So far, it seems that the private sector is ready. Almost. However, government must be cautious as it withdraws. To do so precipitously may send the economy over the cliff -- again.
Thursday, November 6, 2014
Compromise?
Learn from history. There's no other way.
"That government is best which governs least." -- Henry David Thoreau
President Obama has offered to compromise as the Republican Party takes full control of Congress. And despite six years of an improving economy, the Radical Righteous still claim that anything and everything Obama does is wrong.
The unemployment rate nationwide has been cut by nearly half, from above 10 percent to below 6 percent; the federal budget deficit has been steadily declining; the international balance of payments has improved; companies have begun hiring again, and a nationwide health care plan is in place.
All that aside, things are still bad, goes the mantra, and survival depends on less government. Ideally, none at all. That would mean a return to the 1920s or even earlier, when there were no controls over Wall Street speculators, corporate barons, banking and finance strategists, as well as no Social Security pension plans, unemployment benefits or bank deposit insurance, or even a minimum wage.
Also, there would be no labor unions to protect the wages, working conditions and civil rights of employees.
In short, no regulation of anything, in any form, in any area, ever. A totally free, unfettered capitalist system, dominated by a few and detrimental to the many.
The so-called Gilded Age of the 1890s was indeed a wonderful time, if you were part of the One Percent and all others "knew their place," and dared not try to rise above their class, even in this "Land of Opportunity." (Can you say hypocrisy?)
Tuesday's election results reflected a strong shift to the right among American voters, who have become disillusioned with any idea of progress out of Washington. The most recent session of Congress has passed the fewest number of bills in many years. The Washington Post, citing Pew Research Center data, noted that the 113th Congress (2013-2014) approved just 108 bills of any substance and only 34 "ceremonial" bills, such as naming post offices or honoring anniversaries. That compares with 183 substantive measures and 33 ceremonial bills passed by the 105th Congress in 1997-1998.
All this even as the GOP lambastes Obama for his failures to accomplish anything. As if reducing unemployment, cutting the deficit, increasing job growth, recovering from the worst economic downturn since the Great Depression, and starting universal health care don't count.
Midterm elections often reduce the strength of an incumbent President and his party, and this happened again this week to the Democrats. As a result, President Obama says he's "eager to work with Congress over the next two years" to continue the economic progress made since the 2008 crisis. However, "the challenges that lay ahead are far too important to allow partisanship or ideology" to prevent progress.
Nevertheless, Obama warned that if Congress fails to act, he will, through executive action.
The conservative wing of the Republican Party seems to believe that the economy has "recovered" and will do nicely if left alone.
The lesson from history is this: As the economy pulls out of the Great Recession, withdrawing government support efforts may well result in a second downturn, as happened in 1937 during the tough years of the Great Depression.
Even that bastion of American business, Bloomberg Business Week, has endorsed Keynesian economics and its strategies of government intervention to boost a nation's health. In the current issue, economics editor Peter Coy writes, "The global economy is failing to thrive, and its caretakers are fumbling," and what the world needs now is the stimulus strategies of economist John Maynard Keynes. "The symptoms of the Great Depression are back," Coy writes, "though fortunately on a smaller scale."
Moreover, calls for reductions in spending are counterproductive, because if everyone does it, nobody benefits, since "your spending is my income," and vice versa, as Nobel Economist Paul Krugman has put it. And on a national level, "a country is not a company."
In this corner, we noted four years ago that withdrawing support too soon as an economy begins to recover may well happen again, just as it did in 1937.
Be warned.
"That government is best which governs least." -- Henry David Thoreau
President Obama has offered to compromise as the Republican Party takes full control of Congress. And despite six years of an improving economy, the Radical Righteous still claim that anything and everything Obama does is wrong.
The unemployment rate nationwide has been cut by nearly half, from above 10 percent to below 6 percent; the federal budget deficit has been steadily declining; the international balance of payments has improved; companies have begun hiring again, and a nationwide health care plan is in place.
All that aside, things are still bad, goes the mantra, and survival depends on less government. Ideally, none at all. That would mean a return to the 1920s or even earlier, when there were no controls over Wall Street speculators, corporate barons, banking and finance strategists, as well as no Social Security pension plans, unemployment benefits or bank deposit insurance, or even a minimum wage.
Also, there would be no labor unions to protect the wages, working conditions and civil rights of employees.
In short, no regulation of anything, in any form, in any area, ever. A totally free, unfettered capitalist system, dominated by a few and detrimental to the many.
The so-called Gilded Age of the 1890s was indeed a wonderful time, if you were part of the One Percent and all others "knew their place," and dared not try to rise above their class, even in this "Land of Opportunity." (Can you say hypocrisy?)
Tuesday's election results reflected a strong shift to the right among American voters, who have become disillusioned with any idea of progress out of Washington. The most recent session of Congress has passed the fewest number of bills in many years. The Washington Post, citing Pew Research Center data, noted that the 113th Congress (2013-2014) approved just 108 bills of any substance and only 34 "ceremonial" bills, such as naming post offices or honoring anniversaries. That compares with 183 substantive measures and 33 ceremonial bills passed by the 105th Congress in 1997-1998.
All this even as the GOP lambastes Obama for his failures to accomplish anything. As if reducing unemployment, cutting the deficit, increasing job growth, recovering from the worst economic downturn since the Great Depression, and starting universal health care don't count.
Midterm elections often reduce the strength of an incumbent President and his party, and this happened again this week to the Democrats. As a result, President Obama says he's "eager to work with Congress over the next two years" to continue the economic progress made since the 2008 crisis. However, "the challenges that lay ahead are far too important to allow partisanship or ideology" to prevent progress.
Nevertheless, Obama warned that if Congress fails to act, he will, through executive action.
The conservative wing of the Republican Party seems to believe that the economy has "recovered" and will do nicely if left alone.
The lesson from history is this: As the economy pulls out of the Great Recession, withdrawing government support efforts may well result in a second downturn, as happened in 1937 during the tough years of the Great Depression.
Even that bastion of American business, Bloomberg Business Week, has endorsed Keynesian economics and its strategies of government intervention to boost a nation's health. In the current issue, economics editor Peter Coy writes, "The global economy is failing to thrive, and its caretakers are fumbling," and what the world needs now is the stimulus strategies of economist John Maynard Keynes. "The symptoms of the Great Depression are back," Coy writes, "though fortunately on a smaller scale."
Moreover, calls for reductions in spending are counterproductive, because if everyone does it, nobody benefits, since "your spending is my income," and vice versa, as Nobel Economist Paul Krugman has put it. And on a national level, "a country is not a company."
In this corner, we noted four years ago that withdrawing support too soon as an economy begins to recover may well happen again, just as it did in 1937.
Be warned.
Thursday, October 30, 2014
Tidings
Steady as she goes!
Watch for cross winds!
Catch the rising tide!
Economic growth in the U.S. continued, the government reported Thursday, with output expanding by 3.5 percent in the third quarter ended September 30. That was not as strong as the 4.6 percent increase in GDP (Gross Domestic Product) posted for the second quarter, but enough of a healthy sign that regulators' stimulus efforts will ease.
On Wednesday, the Federal Reserve said it would stop its pump-priming efforts in a month, assuming things continue as they have been. However, the Fed also emphasized that it would watch carefully for danger signs, and reserved for itself the notion that it would resume.
That point was emphasized earlier in the week by Fed Vice Chairman Stanley Fischer. who reminded an IMF meeting in Washington that the Fed faces "special challenges" for itself as well as for "the global economy in an increasingly interconnected world."
"A central bank cannot ignore developments beyond its country's borders," Fischer said, "and the Fed is no exception," especially since U.S. Treasury securities are "the world's favorite safe asset."
For this and for many other reasons, the Fed will continue to monitor closely economic developments worldwide, Fischer said.
Watch for cross winds!
Catch the rising tide!
Economic growth in the U.S. continued, the government reported Thursday, with output expanding by 3.5 percent in the third quarter ended September 30. That was not as strong as the 4.6 percent increase in GDP (Gross Domestic Product) posted for the second quarter, but enough of a healthy sign that regulators' stimulus efforts will ease.
On Wednesday, the Federal Reserve said it would stop its pump-priming efforts in a month, assuming things continue as they have been. However, the Fed also emphasized that it would watch carefully for danger signs, and reserved for itself the notion that it would resume.
That point was emphasized earlier in the week by Fed Vice Chairman Stanley Fischer. who reminded an IMF meeting in Washington that the Fed faces "special challenges" for itself as well as for "the global economy in an increasingly interconnected world."
"A central bank cannot ignore developments beyond its country's borders," Fischer said, "and the Fed is no exception," especially since U.S. Treasury securities are "the world's favorite safe asset."
For this and for many other reasons, the Fed will continue to monitor closely economic developments worldwide, Fischer said.
A More Perfect Union
There are four elements to a full union of states (or nation-states, for the European Union). Broadly speaking, these elements are fiscal union, monetary union, political union and economic union.
The U.S. to a large extent has all four, despite some rough spots that can still cause friction. The Declaration of Independence in 1776 referred to the "free and independent states" of America, but the first form of government for the new nation, the Articles of Confederation, quickly proved unworkable, so a new Constitution was proposed and adopted with a stronger central government. Later, it took a Civil War to solidify the union politically, and another half-century until the federal government was able to exert its monetary authority over the banking system. And because the Constitution established the federal government as the regulator of interstate commerce, forbidding the individual states from enacting tariffs on goods from other states, economic union was strengthened. Fiscal union was also strengthened by the Constitution, enabling the central government to enact and collect tax revenue for its operations. Previously, the Articles of Confederation required the unanimous approval of the states before the federal government could impose a tax.
Much of this is covered in detail in a working paper from the International Monetary Fund titled "The Making of a Continental Financial System: Lessons for Europe from Early American History," prepared by Vitor Gaspar of the IMF Fiscal Affairs Department.
So while the U.S. has achieved "a more perfect union" through its Constitution of 1789, the 28 members of the European Union have yet to agree on enough of the four elements to fully realize the benefits of a continental union. And unless the EU does this -- centralize monetary policy and get a strong enough central government to dominate fiscal policy -- political union may not survive, especially if fiscal policy (government spending) is still largely set by individual member states.
Currently, Germany's insistence on austerity by other nations as the way to resolve economic problems will stall recovery and may well lead to collapse of the EU.
History details numerous attempts to establish by force a dominant central government. All have failed. One answer, then, has been to establish a more perfect union through economics, removing trade and personal movement barriers among members of the European Union as a first step, then establishing a single currency to facilitate trade.
However, only 18 of the 28 members of the EU have adopted the euro, and the European Central Bank does not yet seem to have sufficient authority to regulate the number of euros put into circulation by the various members, and thus their value.
The U.S. solved this problem early on, designating the federal government as the sole issuer of dollars. Previously, banks in each state could and did issue their own currency, and people in one state would not trust the validity of money from an adjacent state.
So the big question is this: Can Europe have economic union without fiscal, monetary and political union? Or will cultural and linguistic differences, along with historical distrust of neighbors, prevent a full union and bring a return to a fragmented continent and an attempt by one nation to dominate by force?
Many of these issues were resolved long ago in the U.S., even as regional, cultural and language differences remain. And despite the praise by some of America as a "Great Melting Pot," the reality is that it never was. The great strength of America is that it is a kaleidoscope of cultures, with its citizens (most of them, anyway) accepting the many differences of others.
The U.S. to a large extent has all four, despite some rough spots that can still cause friction. The Declaration of Independence in 1776 referred to the "free and independent states" of America, but the first form of government for the new nation, the Articles of Confederation, quickly proved unworkable, so a new Constitution was proposed and adopted with a stronger central government. Later, it took a Civil War to solidify the union politically, and another half-century until the federal government was able to exert its monetary authority over the banking system. And because the Constitution established the federal government as the regulator of interstate commerce, forbidding the individual states from enacting tariffs on goods from other states, economic union was strengthened. Fiscal union was also strengthened by the Constitution, enabling the central government to enact and collect tax revenue for its operations. Previously, the Articles of Confederation required the unanimous approval of the states before the federal government could impose a tax.
Much of this is covered in detail in a working paper from the International Monetary Fund titled "The Making of a Continental Financial System: Lessons for Europe from Early American History," prepared by Vitor Gaspar of the IMF Fiscal Affairs Department.
So while the U.S. has achieved "a more perfect union" through its Constitution of 1789, the 28 members of the European Union have yet to agree on enough of the four elements to fully realize the benefits of a continental union. And unless the EU does this -- centralize monetary policy and get a strong enough central government to dominate fiscal policy -- political union may not survive, especially if fiscal policy (government spending) is still largely set by individual member states.
Currently, Germany's insistence on austerity by other nations as the way to resolve economic problems will stall recovery and may well lead to collapse of the EU.
History details numerous attempts to establish by force a dominant central government. All have failed. One answer, then, has been to establish a more perfect union through economics, removing trade and personal movement barriers among members of the European Union as a first step, then establishing a single currency to facilitate trade.
However, only 18 of the 28 members of the EU have adopted the euro, and the European Central Bank does not yet seem to have sufficient authority to regulate the number of euros put into circulation by the various members, and thus their value.
The U.S. solved this problem early on, designating the federal government as the sole issuer of dollars. Previously, banks in each state could and did issue their own currency, and people in one state would not trust the validity of money from an adjacent state.
So the big question is this: Can Europe have economic union without fiscal, monetary and political union? Or will cultural and linguistic differences, along with historical distrust of neighbors, prevent a full union and bring a return to a fragmented continent and an attempt by one nation to dominate by force?
Many of these issues were resolved long ago in the U.S., even as regional, cultural and language differences remain. And despite the praise by some of America as a "Great Melting Pot," the reality is that it never was. The great strength of America is that it is a kaleidoscope of cultures, with its citizens (most of them, anyway) accepting the many differences of others.
Monday, October 20, 2014
Perspectives
Beware of Absolutes
If it sounds too good to be true, it probably is.
Among image marketers, politicians are especially fond of using terms like only, first, biggest, or "in living memory," without putting the term in any context. For example, there was a time when a senator was regularly referred to as "the only Democrat holding statewide elective office in New Jersey." (This from a reporter who later got a job as a party publicist.) The statement was true. The senator was in fact the only Dem holding statewide elective office. The problem was that there were only three such offices: Governor and two U.S. senators. Other states may also have a lieutenant governor and an elected attorney general, but that brings the total of statewide elective offices to just five.
A major literary magazine fell victim to image marketers when it wrote that "three of the past nine Presidents have come from Texas." Perhaps. But that partly depends on how one defines a Texan. Lyndon B. Johnson certainly qualifies, because he was born in Texas, raised in Texas, and until he became President, represented Texas in Congress. Dwight D. Eisenhower was born in Texas, but grew up in Kansas and left at age 20 for West Point and spent his career in the military. However, if simply being born in Texas is the main qualification, that eliminates George W. Bush, who was born in Connecticut, despite growing up in Texas and serving there as governor.
Moral to journalists: Be suspicious of all claims by political marketers.
Speaking of definitions, keep this in mind when covering the rants of climate change deniers. Climate and weather are not the same thing. Snowstorms almost never hit Miami and South Florida. Likewise, a December temperature of 100 degrees Fahrenheit is highly unlikely for Manitoba, Canada.
Fifty years ago, mockingbirds were rarely seen anywhere north of Virginia. Now, they are common in Northern New Jersey.
Sixty years ago, outdoor ice skating was routine in that same area. Now, ponds rarely freeze over long enough to support skaters.
One hundred years ago, skating on Central Park Lake in Manhattan was a popular winter pastime. You can't do it today.
Climate is the general range of conditions throughout the year. Weather deals with daily changes. The issue, then, is not whether climates are changing around the world, but how much people contribute to that trend.
Reporters and editors too often overplay a story, insisting that it "sizzle." That emphasis, however, neglects the steak. Example: The Y2K so-called "Millennium Bug," which supposedly would crash computer systems worldwide at the stroke of midnight as 1999 ended and the year 2000 began. This "danger" was based on the idea that computers only dated things with the final two digits of a year -- that is "00." Thus, the computer would not know whether the year would become 1900 or something new.
Computer programmers for mortgage and bond issuers noted the problem 30 years earlier, and soon computers were reprogrammed to account for the new year 2000.
That didn't stop the worry warts, however, especially those working for companies marketing software packages to prevent a problem that didn't really exist. Moreover, the doomsayers never did specify whether the Great Computer Crash would occur at midnight Eastern Standard Time, Greenwich Mean Time, or any of the 22 other time zones around the world.
PANIC PERSPECTIVE -- Ebola is a dangerous and deadly disease that has killed thousands in several West African countries, and certainly needs to be dealt with. However, panic in America is misplaced, partly due to excessive one-side media coverage for several weeks. Within the past few days, however, mass media have added this perspective: There has been one (1) fatality due to the disease and two (2) patients diagnosed with Ebola infections. All three cases were in Dallas. The one death was that of a man who contracted the disease in Liberia. The other two cases were nurses who helped to care for the victim before he died.
Population of the U.S. -- more than 300 million. Thousands of Americans die of influenza each year. Many more thousands die of smoking, alcohol, gunshots, obesity, and traffic accidents.
If it sounds too good to be true, it probably is.
Among image marketers, politicians are especially fond of using terms like only, first, biggest, or "in living memory," without putting the term in any context. For example, there was a time when a senator was regularly referred to as "the only Democrat holding statewide elective office in New Jersey." (This from a reporter who later got a job as a party publicist.) The statement was true. The senator was in fact the only Dem holding statewide elective office. The problem was that there were only three such offices: Governor and two U.S. senators. Other states may also have a lieutenant governor and an elected attorney general, but that brings the total of statewide elective offices to just five.
A major literary magazine fell victim to image marketers when it wrote that "three of the past nine Presidents have come from Texas." Perhaps. But that partly depends on how one defines a Texan. Lyndon B. Johnson certainly qualifies, because he was born in Texas, raised in Texas, and until he became President, represented Texas in Congress. Dwight D. Eisenhower was born in Texas, but grew up in Kansas and left at age 20 for West Point and spent his career in the military. However, if simply being born in Texas is the main qualification, that eliminates George W. Bush, who was born in Connecticut, despite growing up in Texas and serving there as governor.
Moral to journalists: Be suspicious of all claims by political marketers.
Speaking of definitions, keep this in mind when covering the rants of climate change deniers. Climate and weather are not the same thing. Snowstorms almost never hit Miami and South Florida. Likewise, a December temperature of 100 degrees Fahrenheit is highly unlikely for Manitoba, Canada.
Fifty years ago, mockingbirds were rarely seen anywhere north of Virginia. Now, they are common in Northern New Jersey.
Sixty years ago, outdoor ice skating was routine in that same area. Now, ponds rarely freeze over long enough to support skaters.
One hundred years ago, skating on Central Park Lake in Manhattan was a popular winter pastime. You can't do it today.
Climate is the general range of conditions throughout the year. Weather deals with daily changes. The issue, then, is not whether climates are changing around the world, but how much people contribute to that trend.
Reporters and editors too often overplay a story, insisting that it "sizzle." That emphasis, however, neglects the steak. Example: The Y2K so-called "Millennium Bug," which supposedly would crash computer systems worldwide at the stroke of midnight as 1999 ended and the year 2000 began. This "danger" was based on the idea that computers only dated things with the final two digits of a year -- that is "00." Thus, the computer would not know whether the year would become 1900 or something new.
Computer programmers for mortgage and bond issuers noted the problem 30 years earlier, and soon computers were reprogrammed to account for the new year 2000.
That didn't stop the worry warts, however, especially those working for companies marketing software packages to prevent a problem that didn't really exist. Moreover, the doomsayers never did specify whether the Great Computer Crash would occur at midnight Eastern Standard Time, Greenwich Mean Time, or any of the 22 other time zones around the world.
PANIC PERSPECTIVE -- Ebola is a dangerous and deadly disease that has killed thousands in several West African countries, and certainly needs to be dealt with. However, panic in America is misplaced, partly due to excessive one-side media coverage for several weeks. Within the past few days, however, mass media have added this perspective: There has been one (1) fatality due to the disease and two (2) patients diagnosed with Ebola infections. All three cases were in Dallas. The one death was that of a man who contracted the disease in Liberia. The other two cases were nurses who helped to care for the victim before he died.
Population of the U.S. -- more than 300 million. Thousands of Americans die of influenza each year. Many more thousands die of smoking, alcohol, gunshots, obesity, and traffic accidents.
Friday, October 17, 2014
Beige Blues
Once again, the U.S. Federal Reserve summarized the overall growth in the economy as "mild to moderate" in its Beige Book report. Meanwhile, other economic analyses keep pointing to troubling signs, both in the U.S. and around the world.
One gets suspicious when the same positive term is used so much. It could be true, of course, but it could also mean they're polishing the economic apple, emphasizing what good news they may have and burying the ungood deep in the report.
On the same day that the Fed summary was released, Wall Street posted a major drop in stock indexes, prompting a New York Times reporter to wonder whether investors know something the rest of us don't know. And in Europe, there's a growing revolt against German insistence on a policy of austerity to resolve economic problems. The International Monetary Fund has called for government stimulus via an "infrastructure push" to kickstart the economic engine.
For the moment, there are too many conflicting signals to make a clear call on a trend. All in all, however, the future does not look great. As for those who continue to believe that Wall Street is a barometer of the overall economy, it's important to remember that too many investors trade on fear. That is, an unreasoning fear that drives their buy or sell decisions.
Alan Greenspan a few years ago warned of "irrational exuberance" when the stock market bulls were running. It's also good to bear in mind that irrationality works both ways, and the exuberance may be just illusionary bull.
One gets suspicious when the same positive term is used so much. It could be true, of course, but it could also mean they're polishing the economic apple, emphasizing what good news they may have and burying the ungood deep in the report.
On the same day that the Fed summary was released, Wall Street posted a major drop in stock indexes, prompting a New York Times reporter to wonder whether investors know something the rest of us don't know. And in Europe, there's a growing revolt against German insistence on a policy of austerity to resolve economic problems. The International Monetary Fund has called for government stimulus via an "infrastructure push" to kickstart the economic engine.
For the moment, there are too many conflicting signals to make a clear call on a trend. All in all, however, the future does not look great. As for those who continue to believe that Wall Street is a barometer of the overall economy, it's important to remember that too many investors trade on fear. That is, an unreasoning fear that drives their buy or sell decisions.
Alan Greenspan a few years ago warned of "irrational exuberance" when the stock market bulls were running. It's also good to bear in mind that irrationality works both ways, and the exuberance may be just illusionary bull.
Tuesday, October 7, 2014
Global No Go-Go
"Is a puzzlement," said the king.
Economic growth worldwide is "weak and uneven," with some countries still struggling to pull up from a downturn, according to a report from the International Monetary Fund. Others, including the U.S., the UK and Canada, are doing reasonably well, but some in Europe are barely in a growth mode, the IMF said.
The IMF has urged further stimulus, but some government officials in Germany have challenged the suggestion that an "infrastructure push" will help stave off another downturn. And they continued their call for stiffer, conservative measures by other countries to balance their budgets. Even so, Chancellor Angela Merkel is reportedly looking for ways to stimulate growth without boosting government spending.
Meanwhile, China's booming growth rate of 7 percent yearly may be leveling off, the IMF report said, to a more sustainable rate.
Overall, however, the worldwide economic outlook has a tepid future. Global growth is likely to average 3.3 percent this year, the IMF said, unchanged from 2013. And "the legacies of the pre-crisis boom and the subsequent recession," the IMF analysis said, "still cast a shadow on the recovery." As a result, "global growth is still mediocre," the IMF said, with wide variations among countries.
According to the IMF report, the U.S. will finish this year with a GDP growth rate of 2.2 percent, the UK with 3.2 percent, and Canada with 2.3 percent.
Germany, however, will post an increase of 1.4 percent, while France will barely squeak forward at 0.4 percent. Spain will finally post a positive rate of 1.3 percent, but Italy will still be negative at -0.2 percent. The entire euro area is likely to post a GDP growth of 0.8 percent.
All together, the IMF said the global forecast is disappointing, and its World Economic Outlook report noted an "increase in downside risks."
Economic growth worldwide is "weak and uneven," with some countries still struggling to pull up from a downturn, according to a report from the International Monetary Fund. Others, including the U.S., the UK and Canada, are doing reasonably well, but some in Europe are barely in a growth mode, the IMF said.
The IMF has urged further stimulus, but some government officials in Germany have challenged the suggestion that an "infrastructure push" will help stave off another downturn. And they continued their call for stiffer, conservative measures by other countries to balance their budgets. Even so, Chancellor Angela Merkel is reportedly looking for ways to stimulate growth without boosting government spending.
Meanwhile, China's booming growth rate of 7 percent yearly may be leveling off, the IMF report said, to a more sustainable rate.
Overall, however, the worldwide economic outlook has a tepid future. Global growth is likely to average 3.3 percent this year, the IMF said, unchanged from 2013. And "the legacies of the pre-crisis boom and the subsequent recession," the IMF analysis said, "still cast a shadow on the recovery." As a result, "global growth is still mediocre," the IMF said, with wide variations among countries.
According to the IMF report, the U.S. will finish this year with a GDP growth rate of 2.2 percent, the UK with 3.2 percent, and Canada with 2.3 percent.
Germany, however, will post an increase of 1.4 percent, while France will barely squeak forward at 0.4 percent. Spain will finally post a positive rate of 1.3 percent, but Italy will still be negative at -0.2 percent. The entire euro area is likely to post a GDP growth of 0.8 percent.
All together, the IMF said the global forecast is disappointing, and its World Economic Outlook report noted an "increase in downside risks."
Monday, October 6, 2014
Miscellany
Just because you can doesn't mean you should.
Insult and mockery cannot substitute for intelligence and insight.
When someone says, "Don't you think that ...?" they're not asking for opinion, but for agreement.
Consider the phrase, "I was very fascinated by ..." There are no degrees of fascination, just as there are no degrees of unique, which means "one of a kind." Either you are fascinated or you're not. Either something is one of a kind, or it's not.
Talent is what you're born with. Skill is how you develop it. Luck is what happens to you along the way. Success is a blend of all three.
Propaganda often masquerades as marketing a message.
Typographical gimmickry is no substitute for readability. Grammatical shouting insults reader intelligence.
Consider a sentence with 160 words, 11 commas, 4 dashes and 2 sets of parentheses. It may be "correct" but it's unreadable. Or, when you have the time, count the number of words, commas, semicolons and colons in the opening sentence of John Milton's "Paradise Lost." Then remember why you found the work unreadable, if not boring.
Then there was the press release that put some words IN ALL CAPITAL letters, other words in Bold Face, still others in bold italic, yet others in BOLD ITALIC CAPS and still others BOLD FACE CAPS and underlined. When that strategy goes on for two full pages, it's no longer informational for a news reporter, but like a screeching used car commercial.
Just because you can, doesn't mean you should.
Insult and mockery cannot substitute for intelligence and insight.
When someone says, "Don't you think that ...?" they're not asking for opinion, but for agreement.
Consider the phrase, "I was very fascinated by ..." There are no degrees of fascination, just as there are no degrees of unique, which means "one of a kind." Either you are fascinated or you're not. Either something is one of a kind, or it's not.
Talent is what you're born with. Skill is how you develop it. Luck is what happens to you along the way. Success is a blend of all three.
Propaganda often masquerades as marketing a message.
Typographical gimmickry is no substitute for readability. Grammatical shouting insults reader intelligence.
Consider a sentence with 160 words, 11 commas, 4 dashes and 2 sets of parentheses. It may be "correct" but it's unreadable. Or, when you have the time, count the number of words, commas, semicolons and colons in the opening sentence of John Milton's "Paradise Lost." Then remember why you found the work unreadable, if not boring.
Then there was the press release that put some words IN ALL CAPITAL letters, other words in Bold Face, still others in bold italic, yet others in BOLD ITALIC CAPS and still others BOLD FACE CAPS and underlined. When that strategy goes on for two full pages, it's no longer informational for a news reporter, but like a screeching used car commercial.
Just because you can, doesn't mean you should.
Friday, October 3, 2014
Raising Keynes
If you can't say it in 500 words, you can't say it.
Say what you have to say, be done with it, finish and get out.
President Obama spoke for almost an hour on the economy yesterday afternoon, in what the White House had touted as a major speech, but after 30 minutes CNN cut away from live coverage. After 40 minutes, MSNBC dropped out. Bloomberg TV held on for another 10 minutes, but then they gave up hope that he would say anything new.
The talk was a recitation of the accomplishments of the past few years as the American economy began its recovery, but even so, most of the recitation was a list of things that happened in the private sector; little was said about any government efforts in reviving the economy from the Great Recession.
Moral: Take a hint from FDR's strategy of his occasional "Fireside Chats" via radio to the American public in the 1930s and 1940s. Do it when you have something to say, say it and be done with it. Prattle on too long or too often and you lose the audience as well as credibility.
That said, the crux of the speech was this: The economy's improving, but we're not yet where we could be. The President listed several "cornerstones" to help improve things for the middle class. These were 1/ energy and technology, 2/ education and training, 3/ health care reform, and 4/ finance reform.
All these programs are already in place. However, Obama asserted, "The gains of recovery are not shared enough, and growth could be faster with the help of Congress." Moreover, in a reference to growing inequality, he noted that a "shrinking few are doing very well," while a growing many still struggle.
"This is not a formula for sustained growth," Obama said.
So while the President was praising the status of economic recovery even as he said little about government efforts to support improvement, the International Monetary Fund released a report that said "the time is right for an infrastructure push" by government.
"Borrowing costs are low and demand is weak," the IMF report said, and there are infrastructure bottlenecks that need to be cleared. "Public infrastructure is an essential factor of production," the IMF added, and increasing public investment "raises output in the short and long term, particularly during periods of economic slack and when investment efficiency is high."
And if done correctly, the IMF stressed, "public infrastructure could pay for itself." Put another way, the more that Gilded Agers call for austerity and cuts in spending, the more urgent government action becomes.
Say what you have to say, be done with it, finish and get out.
President Obama spoke for almost an hour on the economy yesterday afternoon, in what the White House had touted as a major speech, but after 30 minutes CNN cut away from live coverage. After 40 minutes, MSNBC dropped out. Bloomberg TV held on for another 10 minutes, but then they gave up hope that he would say anything new.
The talk was a recitation of the accomplishments of the past few years as the American economy began its recovery, but even so, most of the recitation was a list of things that happened in the private sector; little was said about any government efforts in reviving the economy from the Great Recession.
Moral: Take a hint from FDR's strategy of his occasional "Fireside Chats" via radio to the American public in the 1930s and 1940s. Do it when you have something to say, say it and be done with it. Prattle on too long or too often and you lose the audience as well as credibility.
That said, the crux of the speech was this: The economy's improving, but we're not yet where we could be. The President listed several "cornerstones" to help improve things for the middle class. These were 1/ energy and technology, 2/ education and training, 3/ health care reform, and 4/ finance reform.
All these programs are already in place. However, Obama asserted, "The gains of recovery are not shared enough, and growth could be faster with the help of Congress." Moreover, in a reference to growing inequality, he noted that a "shrinking few are doing very well," while a growing many still struggle.
"This is not a formula for sustained growth," Obama said.
So while the President was praising the status of economic recovery even as he said little about government efforts to support improvement, the International Monetary Fund released a report that said "the time is right for an infrastructure push" by government.
"Borrowing costs are low and demand is weak," the IMF report said, and there are infrastructure bottlenecks that need to be cleared. "Public infrastructure is an essential factor of production," the IMF added, and increasing public investment "raises output in the short and long term, particularly during periods of economic slack and when investment efficiency is high."
And if done correctly, the IMF stressed, "public infrastructure could pay for itself." Put another way, the more that Gilded Agers call for austerity and cuts in spending, the more urgent government action becomes.
Sunday, September 28, 2014
Justice For All?
"No justice, no peace!"
Federal judges will be getting long-overdue pay hikes as well as back pay for the six times they were denied scheduled raises. Two court decisions said Congress was wrong in denying raises to nearly 2,000 federal judges throughout the country in 1995, 1996, 1997, 1999, 2007 and 2010.
The Congressional Budget Office, in a letter to Sen. Patrick J. Leahy (D-Vermont), chairman of the Senate Judiciary Committee, cited court decisions that "Congress may not withhold automatic salary increases for certain judges and that it improperly did so on six separate occasions." Result: Judges will now receive pay hikes automatically, as well as back pay for increases they should have received.
The total cost of compensating the judges for lost pay and coming increases will be some $1.2 billion over the next ten years.
Comment: It's a truism that money buys justice. Wealthy folks can hire squadrons of lawyers, while others must rely on Legal Aid from volunteers or government-sponsored agencies. At the same time, judges regularly leave the bench to return to private practice; that's where the big money is.
As it is, federal district court judges this year get a salary of $199,100, and circuit court judges get $211,200. At the U.S. Supreme Court, associate justices draw a salary of $244,400, and the chief justice gets $255,500.
Prosecutors also have the resources of government to investigate and pursue suspects for years, if need be, before filing charges, and then spending more time and money as the case moves through the court system.
Major corporations and the wealthy can often outspend the state in marshalling and continuing their defense, but legal resources for others are severely limited or nonexistent.
The question then becomes this: Is justice distributed evenly and fairly among all groups -- economic, demographic, ethnic and racial -- in America?
Money talks, it has been said. And those with more money can talk longer and louder than those with less.
There's also a tendency among law enforcement officials to aim at easier targets to score points toward a perceived "quota" of sorts to build their reputation and show that they're doing their jobs well, by citing the number of convictions they have obtained. Moreover, there is less publicity over cases involving the unknown. In cases involving celebrities, major corporations, the wealthy and other public figures, prosecutors lose credibility when they lose a case.
Meanwhile, our resident cynic points out that five of the six times federal judges were denied scheduled pay hikes were during a Republican Administration, and the sixth was during a midterm election year with a Democrat in the White House.
"No justice, no peace!" the protestors chant. There's more to that than simply a demand for justice in individual cases. It applies to the whole of a just society, where all are created equal, and thus deserve equal treatment under law.
Federal judges will be getting long-overdue pay hikes as well as back pay for the six times they were denied scheduled raises. Two court decisions said Congress was wrong in denying raises to nearly 2,000 federal judges throughout the country in 1995, 1996, 1997, 1999, 2007 and 2010.
The Congressional Budget Office, in a letter to Sen. Patrick J. Leahy (D-Vermont), chairman of the Senate Judiciary Committee, cited court decisions that "Congress may not withhold automatic salary increases for certain judges and that it improperly did so on six separate occasions." Result: Judges will now receive pay hikes automatically, as well as back pay for increases they should have received.
The total cost of compensating the judges for lost pay and coming increases will be some $1.2 billion over the next ten years.
Comment: It's a truism that money buys justice. Wealthy folks can hire squadrons of lawyers, while others must rely on Legal Aid from volunteers or government-sponsored agencies. At the same time, judges regularly leave the bench to return to private practice; that's where the big money is.
As it is, federal district court judges this year get a salary of $199,100, and circuit court judges get $211,200. At the U.S. Supreme Court, associate justices draw a salary of $244,400, and the chief justice gets $255,500.
Prosecutors also have the resources of government to investigate and pursue suspects for years, if need be, before filing charges, and then spending more time and money as the case moves through the court system.
Major corporations and the wealthy can often outspend the state in marshalling and continuing their defense, but legal resources for others are severely limited or nonexistent.
The question then becomes this: Is justice distributed evenly and fairly among all groups -- economic, demographic, ethnic and racial -- in America?
Money talks, it has been said. And those with more money can talk longer and louder than those with less.
There's also a tendency among law enforcement officials to aim at easier targets to score points toward a perceived "quota" of sorts to build their reputation and show that they're doing their jobs well, by citing the number of convictions they have obtained. Moreover, there is less publicity over cases involving the unknown. In cases involving celebrities, major corporations, the wealthy and other public figures, prosecutors lose credibility when they lose a case.
Meanwhile, our resident cynic points out that five of the six times federal judges were denied scheduled pay hikes were during a Republican Administration, and the sixth was during a midterm election year with a Democrat in the White House.
"No justice, no peace!" the protestors chant. There's more to that than simply a demand for justice in individual cases. It applies to the whole of a just society, where all are created equal, and thus deserve equal treatment under law.
Friday, September 26, 2014
Looking Good
Are we there yet?
We're getting close.
A few weeks ago, the economic diagnosticians said things would likely improve through the rest of the year. This time, they may be right. A new estimate of American output for the second quarter put the Gross Domestic Product increase at 4.6 percent, higher than the 4.2 percent in the earlier estimate, a major turnaround from the drop of 2.1 percent in the first quarter.
Why? People are spending, buying more stuff as business produces more. Officially, a statement from the Commerce Department's Bureau of Economic Analysis said the increases primarily reflected upturns in exports, inventories, state and local government spending, and housing.
So while folks who have jobs may be spending more, thus helping the economy, there are still many others who either don't have jobs or are falling behind as prices go up and their income levels are steady.
The good news, however, is that the American economy is on an upward trend. The not so good news is that much of the rest of the world is not.
Stay tuned.
We're getting close.
A few weeks ago, the economic diagnosticians said things would likely improve through the rest of the year. This time, they may be right. A new estimate of American output for the second quarter put the Gross Domestic Product increase at 4.6 percent, higher than the 4.2 percent in the earlier estimate, a major turnaround from the drop of 2.1 percent in the first quarter.
Why? People are spending, buying more stuff as business produces more. Officially, a statement from the Commerce Department's Bureau of Economic Analysis said the increases primarily reflected upturns in exports, inventories, state and local government spending, and housing.
So while folks who have jobs may be spending more, thus helping the economy, there are still many others who either don't have jobs or are falling behind as prices go up and their income levels are steady.
The good news, however, is that the American economy is on an upward trend. The not so good news is that much of the rest of the world is not.
Stay tuned.
Wednesday, September 24, 2014
Go Figure
College enrollment dropped last year by nearly half a million, the Census Bureau said, the second year in a row for a drop of this magnitude. Added together, some 930,000 students failed to move to higher education, larger than any college enrollment drop since before the Great Recession.
Meanwhile, another Census Bureau report said sales of single-family houses jumped by 18 percent in August, to a seasonally adjusted annual rate of 504,000.
And yet another Census report noted declines in tax revenues. Individual income tax revenue fell by nearly 6 percent in the second quarter, while corporate income tax dropped by 3 percent. The same report said sales tax revenue rose 5.6 percent.
Also, income and poverty levels were basically unchanged last year from the year before, still another Census report said.
No wonder so many people are confused. Is the economy getting better, or not?
It would seem that getting a job has a priority, since college enrollment faded. And buying a house is also a priority, since interest rates are relatively low and prices are likely to go up.
But if income levels are steady and tax revenues are going down, that could mean ...
Who knows what?
Go figure.
Meanwhile, another Census Bureau report said sales of single-family houses jumped by 18 percent in August, to a seasonally adjusted annual rate of 504,000.
And yet another Census report noted declines in tax revenues. Individual income tax revenue fell by nearly 6 percent in the second quarter, while corporate income tax dropped by 3 percent. The same report said sales tax revenue rose 5.6 percent.
Also, income and poverty levels were basically unchanged last year from the year before, still another Census report said.
No wonder so many people are confused. Is the economy getting better, or not?
It would seem that getting a job has a priority, since college enrollment faded. And buying a house is also a priority, since interest rates are relatively low and prices are likely to go up.
But if income levels are steady and tax revenues are going down, that could mean ...
Who knows what?
Go figure.
Friday, September 19, 2014
Stabilizing, Maybe?
It's time for a trickle-up theory of economic growth.
"The economy is making progress." -- Janet Yellen, chair, U.S. Federal Reserve
Global economic growth "is too weak, fragile and uneven." -- Christine Lagarde, managing director, International Monetary Fund.
As the national and the world economies struggle to gain some momentum, assisted by central banks and international lenders through monetary policies that try to induce lenders and borrowers to jump-start economic engines, the U.S. Congress wants a bigger role as overseer of what the Fed does, with regular audits of the Fed's monetary policy as well as any transactions "involving a foreign central bank, the government of a foreign country, or a nonprivate international financing organization." So says an analysis by the Congressional Budget Office of a House proposal to increase Congressional authority over what the Fed does.
The CBO report on H.R. 24, the Federal Reserve Transparency Act, said the bill would direct the Government Accountability Office (GAO) to audit the Fed Board of Governors, and the Fed's 12 district banks. Such audits are now banned, and repealing the prohibitions would not only call for audits with 12 months of enacting the bill, but would also bring on "future requests from Members of Congress for GAO to conduct additional oversight and analysis of the Federal Reserve System."
Cost: $5 billion over five years to hire staff and pay expenses for the audits, the CBO said. In addition, a loss of revenue that the Fed pays to the Treasury of as much as $7 million.
So even as the Fed sees some progress and warns that its future actions will be cautious, and international agencies such as the IMF and central banks in Europe push to keep money -- and consequently the economy -- flowing and growing, some in the U.S. Congress want to put their leash on the monetary watchdogs at the Fed. In short, politicians want to monitor the monitors.
Is this a good idea? Since its inception a hundred years ago, the Federal Reserve has been independent -- even secretive -- in its efforts to step in to boost the economy when needed, and to slow things down when business partying gets too raucous. Granted, they don't always succeed, but political oversight -- read interference -- by partisans who may be anxious to blame incumbents for economic malaise can be more dangerous.
Meanwhile, things may be getting a bit better. The Census Bureau reported that the poverty rate in America declined for the first time since 2006. A small change, statistically insignificant, the report admitted, along with a statistically insignificant change in median household income. But at least it's not getting worse. That, however, is small comfort to those in the middle and lower income groups whose income is stable even as those in the highest grouping see increases in their wealth.
And while the U.S. may have halted an economic decline, many other nations are still looking at a potential downward slide.
"The economy is making progress." -- Janet Yellen, chair, U.S. Federal Reserve
Global economic growth "is too weak, fragile and uneven." -- Christine Lagarde, managing director, International Monetary Fund.
As the national and the world economies struggle to gain some momentum, assisted by central banks and international lenders through monetary policies that try to induce lenders and borrowers to jump-start economic engines, the U.S. Congress wants a bigger role as overseer of what the Fed does, with regular audits of the Fed's monetary policy as well as any transactions "involving a foreign central bank, the government of a foreign country, or a nonprivate international financing organization." So says an analysis by the Congressional Budget Office of a House proposal to increase Congressional authority over what the Fed does.
The CBO report on H.R. 24, the Federal Reserve Transparency Act, said the bill would direct the Government Accountability Office (GAO) to audit the Fed Board of Governors, and the Fed's 12 district banks. Such audits are now banned, and repealing the prohibitions would not only call for audits with 12 months of enacting the bill, but would also bring on "future requests from Members of Congress for GAO to conduct additional oversight and analysis of the Federal Reserve System."
Cost: $5 billion over five years to hire staff and pay expenses for the audits, the CBO said. In addition, a loss of revenue that the Fed pays to the Treasury of as much as $7 million.
So even as the Fed sees some progress and warns that its future actions will be cautious, and international agencies such as the IMF and central banks in Europe push to keep money -- and consequently the economy -- flowing and growing, some in the U.S. Congress want to put their leash on the monetary watchdogs at the Fed. In short, politicians want to monitor the monitors.
Is this a good idea? Since its inception a hundred years ago, the Federal Reserve has been independent -- even secretive -- in its efforts to step in to boost the economy when needed, and to slow things down when business partying gets too raucous. Granted, they don't always succeed, but political oversight -- read interference -- by partisans who may be anxious to blame incumbents for economic malaise can be more dangerous.
Meanwhile, things may be getting a bit better. The Census Bureau reported that the poverty rate in America declined for the first time since 2006. A small change, statistically insignificant, the report admitted, along with a statistically insignificant change in median household income. But at least it's not getting worse. That, however, is small comfort to those in the middle and lower income groups whose income is stable even as those in the highest grouping see increases in their wealth.
And while the U.S. may have halted an economic decline, many other nations are still looking at a potential downward slide.
Violence and Football
"It's not whether you win or lose; it's how you play the game." -- Grantland Rice.
"Winning isn't everything. It's the only thing." -- Vince Lombardi
Football is an inherently violent business, so it's no surprise that at its most violent level, its employees -- also known as "players" -- take that violence with them to their private lives. Result: These gladiators are quick to react to provocation, even from those they supposedly care about and claim they love.
One of the most recent news stories shows a video clip of a footballer punching and knocking unconscious his fiancee. And at first, the consequence of his action was minimal as the league executives denied knowing about it. Until, that is, more video became public.
When sport becomes a business, profit kills sportsmanship. The National Football League (NFL) in America is a business, not a sport.
Moreover, it may well be that the popularity of football, with all its violence, is a reflection of American culture. Boxing is still popular, as is hockey, with fistfights on the ice common among the most successful teams. Computer games -- the more violent the better -- also reflect a cultural preference for violence. Hollywood indulges this taste through vivid special effects that become more vivid and violent with each year.
In addition to all this, there is the issue of gun violence. The National Rifle Association insists that the Constitution guarantees the right of every individual to have a firearm, but they conveniently ignore the opening phrase of the Second Amendment basing that right on the need for a "well regulated militia" to ensure the security of a free state.
Nowhere in the Constitution is there mention of unregulated, individual "rights" to have a personal arsenal.
"Winning isn't everything. It's the only thing." -- Vince Lombardi
Football is an inherently violent business, so it's no surprise that at its most violent level, its employees -- also known as "players" -- take that violence with them to their private lives. Result: These gladiators are quick to react to provocation, even from those they supposedly care about and claim they love.
One of the most recent news stories shows a video clip of a footballer punching and knocking unconscious his fiancee. And at first, the consequence of his action was minimal as the league executives denied knowing about it. Until, that is, more video became public.
When sport becomes a business, profit kills sportsmanship. The National Football League (NFL) in America is a business, not a sport.
Moreover, it may well be that the popularity of football, with all its violence, is a reflection of American culture. Boxing is still popular, as is hockey, with fistfights on the ice common among the most successful teams. Computer games -- the more violent the better -- also reflect a cultural preference for violence. Hollywood indulges this taste through vivid special effects that become more vivid and violent with each year.
In addition to all this, there is the issue of gun violence. The National Rifle Association insists that the Constitution guarantees the right of every individual to have a firearm, but they conveniently ignore the opening phrase of the Second Amendment basing that right on the need for a "well regulated militia" to ensure the security of a free state.
Nowhere in the Constitution is there mention of unregulated, individual "rights" to have a personal arsenal.
Friday, September 12, 2014
Inequality Brings Change
Inequality brings change, whether it be political, economic, or for civil rights.
Mercantilism is a short-sighted focus on gaining more wealth at the expense of others, often through a colonial relationship. In this mindset, the dominant country collects resources or basic materials from the colony, manufactures finished goods and sells them back to the colony at a profit.
Part of the strategy is to prohibit the colony from manufacturing anything, or of selling raw materials to anyone else. Taking that a step further, the dominant country requires that all transport to and from the colony be done by dominant country shippers.
So while home country merchants, manufacturers and shippers benefit from this arrangement, there soon comes a point where the colony is dry of resources and has no ability to purchase finished goods from either its parent or any other source.
This ever-widening gap between the haves and the have-nots inevitably brings about a change in the relationship.
Mercantilism thus creates a wealth gap. (Perhaps another word for mercantilism would be "greed.") It was a similar mercantilistic wealth gap that brought about American independence nearly 250 years ago. And in the late 19th Century and early 20th Century in America, a wealth gap helped foster the growth of labor unions to ensure reasonable wages and working conditions. Related to that was the Progressive political movement for social reform, from which evolved such things as government-sponsored pension plans (Social Security), unemployment compensation, and legal rights for labor unions.
Wealth gaps help to foment change, in many countries through various means. Some for political independence, some for economic independence, some peacefully through evolution and some violently through revolution.
Put another way, whoever has the most gold at the end, wins. But that does him no good if he has no food.
Mercantilism is a short-sighted focus on gaining more wealth at the expense of others, often through a colonial relationship. In this mindset, the dominant country collects resources or basic materials from the colony, manufactures finished goods and sells them back to the colony at a profit.
Part of the strategy is to prohibit the colony from manufacturing anything, or of selling raw materials to anyone else. Taking that a step further, the dominant country requires that all transport to and from the colony be done by dominant country shippers.
So while home country merchants, manufacturers and shippers benefit from this arrangement, there soon comes a point where the colony is dry of resources and has no ability to purchase finished goods from either its parent or any other source.
This ever-widening gap between the haves and the have-nots inevitably brings about a change in the relationship.
Mercantilism thus creates a wealth gap. (Perhaps another word for mercantilism would be "greed.") It was a similar mercantilistic wealth gap that brought about American independence nearly 250 years ago. And in the late 19th Century and early 20th Century in America, a wealth gap helped foster the growth of labor unions to ensure reasonable wages and working conditions. Related to that was the Progressive political movement for social reform, from which evolved such things as government-sponsored pension plans (Social Security), unemployment compensation, and legal rights for labor unions.
Wealth gaps help to foment change, in many countries through various means. Some for political independence, some for economic independence, some peacefully through evolution and some violently through revolution.
Put another way, whoever has the most gold at the end, wins. But that does him no good if he has no food.
Responsibility
To say, "The Devil made me do it" is to clear you of any blame.
To say, "I am nothing without God" is to deny you any credit.
You are responsible for your actions and behavior, whether good or ill.
To say, "I am nothing without God" is to deny you any credit.
You are responsible for your actions and behavior, whether good or ill.
Tuesday, September 9, 2014
Scotland the Brave
Be careful what you wish for. You may get it.
Political independence without monetary independence can be dangerous. Examples: Spain, Greece, Italy, Ireland. As things stand now, the United Kingdom essentially has both.
Membership in the EU enables free trade, but the UK still has political independence and monetary independence. Members in the euro zone have political independence, but do not have full control over monetary policy. As it is, Germany pushes austerity as a means to "resolve" economic issues for other countries (easy for them to say, since Germany is prospering). As I have written before, austerity may be OK for a family or a firm, but on a national level it doesn't work. In fact, it's destructive.
In general, I believe the concept of a unified Europe -- the European Union -- is a good one, and a free trade union is a good start. However, establishing monetary union before political union has brought many conflicts with it.
On this side of the pond, the 13 colonies formed a political union in 1776, but even so, it took some 80 years for that to solidify. The Articles of Confederation weren't strong enough to hold the "free and independent" states together, and it took a Civil War to establish the federal government's authority under the Constitution of 1789. Even so, it was even later that full control of the monetary system really was fixed to the federal level. The Federal Reserve, for example, was not set up until 1914. Previous attempts to have a central bank failed.
So, should Scotland secede? It has always been a separate nation, even as it was united under one monarch. But to resume political independence while retaining monetary union, with the Bank of England regulating monetary policy, can be economically hazardous. Better that the Bank of Scotland take on the full duties of a central bank. Joining the European Union as a new, independent nation member, would only transfer monetary policy control to Brussels and the European Central Bank, as well as having to deal with pressure from Berlin.
Similar issues would arise for other smaller peoples considering independence in Europe, such as the Basques. Likewise, Puerto Rico must consider these potential problems with an independence movement.
In a federal setup with political as well as monetary union, such as the U.S., the state of Florida, for example, can -- and has --- looked to Washington for bailout help in times of crisis, e.g. high unemployment and benefits claims, housing crashes, bank failures, etc.
Likewise, Scotland can now look to London for help in dealing with financial crises. With independence, they would have to go it alone.
Independence is never an easy path, whether for a person or a nation. The Scots have a long and proud history of contributing to the world, such as bagpipes, whisky, and golf, not to mention the economic ideas of Adam Smith and the political and philosophical influence of David Hume.
So if national independence is what the Scots want, I say go for it. But there will be ruts and bumps along the road.
Political independence without monetary independence can be dangerous. Examples: Spain, Greece, Italy, Ireland. As things stand now, the United Kingdom essentially has both.
Membership in the EU enables free trade, but the UK still has political independence and monetary independence. Members in the euro zone have political independence, but do not have full control over monetary policy. As it is, Germany pushes austerity as a means to "resolve" economic issues for other countries (easy for them to say, since Germany is prospering). As I have written before, austerity may be OK for a family or a firm, but on a national level it doesn't work. In fact, it's destructive.
In general, I believe the concept of a unified Europe -- the European Union -- is a good one, and a free trade union is a good start. However, establishing monetary union before political union has brought many conflicts with it.
On this side of the pond, the 13 colonies formed a political union in 1776, but even so, it took some 80 years for that to solidify. The Articles of Confederation weren't strong enough to hold the "free and independent" states together, and it took a Civil War to establish the federal government's authority under the Constitution of 1789. Even so, it was even later that full control of the monetary system really was fixed to the federal level. The Federal Reserve, for example, was not set up until 1914. Previous attempts to have a central bank failed.
So, should Scotland secede? It has always been a separate nation, even as it was united under one monarch. But to resume political independence while retaining monetary union, with the Bank of England regulating monetary policy, can be economically hazardous. Better that the Bank of Scotland take on the full duties of a central bank. Joining the European Union as a new, independent nation member, would only transfer monetary policy control to Brussels and the European Central Bank, as well as having to deal with pressure from Berlin.
Similar issues would arise for other smaller peoples considering independence in Europe, such as the Basques. Likewise, Puerto Rico must consider these potential problems with an independence movement.
In a federal setup with political as well as monetary union, such as the U.S., the state of Florida, for example, can -- and has --- looked to Washington for bailout help in times of crisis, e.g. high unemployment and benefits claims, housing crashes, bank failures, etc.
Likewise, Scotland can now look to London for help in dealing with financial crises. With independence, they would have to go it alone.
Independence is never an easy path, whether for a person or a nation. The Scots have a long and proud history of contributing to the world, such as bagpipes, whisky, and golf, not to mention the economic ideas of Adam Smith and the political and philosophical influence of David Hume.
So if national independence is what the Scots want, I say go for it. But there will be ruts and bumps along the road.
Monday, September 8, 2014
New Gilded Age
We're seeing a New Gilded Age as the income gap widens.
News items:
* On Manhattan's Upper East Side, townhouse mansions built in the 1890s are selling for as much as $40 million and being renovated to their original single-family uses.
* Lower income families are seeing declines as the wealthy gain in prosperity.
* Education debt has increased, even as college graduates struggle to find jobs.
A new report from the Federal Reserve documents the income slide for families in the lowest 20 percent bracket, while those in the top 20 percent show increases in net worth.
The Fed study, done every three years, shows that family incomes, adjusted for inflation, "moved in different directions between 2010 and 2013."
"Families at the bottom of the income distribution saw continued substantial decline in average real incomes between 2010 and 2013, continuing the trend observed" in earlier surveys, the Fed report said.
Moreover, "Only families at the very top of the income distribution saw widespread income gains" over the course of the three-year span. Overall, median income -- the point in the middle -- fell 5 percent, from $49,000 to $46,700. the Fed reported, while the average -- reached by totalling all incomes and dividing by the number of families -- increased by 4 percent, from $84,100 to $87,200. This happens whenever those at the top have wider gains than those at the bottom. And the gap widens when the number for those at the top goes up when the number for those at the bottom goes down.
Simplistic example: In the series 1,2,3,4,5, the median is 3 and the average (arithmetic mean) is also 3. However, in the series 1,2,3,7,9, the median is still three but the mean is higher -- 4.4.
It's the same with an income distribution survey, especially when the number for those at the bottom goes down, but for those at the top it goes up.
The Fed survey showed that income for the 10 percent at the top of the scale rose by 10 percent, "barely budged" for families in the middle, and dropped sharply for families in the lowest 10 percent group.
So without throwing too many more numbers at you, it comes down to this: The economy may be improving (then again, it may not be), and those who have are getting more, but for the rest of us, it's still a struggle.
It was true 120 years ago, when the Manhattan mansions were built, and it's true again today, and the latest report from the Federal Reserve Board provides more evidence that the inequality gap described in detail by Thomas Piketty in his book, "Capital in the 21st Century" does indeed exist and it's getting wider.
Here's another thought to consider: When will the Republican Progressives and trust-busters that were led by the likes of Theodore Roosevelt and William Howard Taft be coming back?
News items:
* On Manhattan's Upper East Side, townhouse mansions built in the 1890s are selling for as much as $40 million and being renovated to their original single-family uses.
* Lower income families are seeing declines as the wealthy gain in prosperity.
* Education debt has increased, even as college graduates struggle to find jobs.
A new report from the Federal Reserve documents the income slide for families in the lowest 20 percent bracket, while those in the top 20 percent show increases in net worth.
The Fed study, done every three years, shows that family incomes, adjusted for inflation, "moved in different directions between 2010 and 2013."
"Families at the bottom of the income distribution saw continued substantial decline in average real incomes between 2010 and 2013, continuing the trend observed" in earlier surveys, the Fed report said.
Moreover, "Only families at the very top of the income distribution saw widespread income gains" over the course of the three-year span. Overall, median income -- the point in the middle -- fell 5 percent, from $49,000 to $46,700. the Fed reported, while the average -- reached by totalling all incomes and dividing by the number of families -- increased by 4 percent, from $84,100 to $87,200. This happens whenever those at the top have wider gains than those at the bottom. And the gap widens when the number for those at the top goes up when the number for those at the bottom goes down.
Simplistic example: In the series 1,2,3,4,5, the median is 3 and the average (arithmetic mean) is also 3. However, in the series 1,2,3,7,9, the median is still three but the mean is higher -- 4.4.
It's the same with an income distribution survey, especially when the number for those at the bottom goes down, but for those at the top it goes up.
The Fed survey showed that income for the 10 percent at the top of the scale rose by 10 percent, "barely budged" for families in the middle, and dropped sharply for families in the lowest 10 percent group.
So without throwing too many more numbers at you, it comes down to this: The economy may be improving (then again, it may not be), and those who have are getting more, but for the rest of us, it's still a struggle.
It was true 120 years ago, when the Manhattan mansions were built, and it's true again today, and the latest report from the Federal Reserve Board provides more evidence that the inequality gap described in detail by Thomas Piketty in his book, "Capital in the 21st Century" does indeed exist and it's getting wider.
Here's another thought to consider: When will the Republican Progressives and trust-busters that were led by the likes of Theodore Roosevelt and William Howard Taft be coming back?
Saturday, September 6, 2014
Jobs Update
One day, as I sat musing, sad and lonely and without a friend, a voice came to me from out of the gloom, saying, "Cheer up, things could be worse."
So I cheered up, and sure enough, things got worse.
Companies are hiring, but the pace of new jobs created has slackened, according to monthly statistics from the U.S. Bureau of Labor Statistics. Part of that, of course, could be the normal August slide, which the number crunchers try to account for by calculating a "seasonally adjusted annual rate." There are also the built-in hazards of telephone surveys. The sample may be too small, especially during vacation months or holiday periods when people are not home.
Nonetheless, surveys are useful, especially over time. In this case, a change over a single month may have little meaning, but when a trend is set over a six-month period, that's something to pay attention to.
In general, looking at one aspect of an economy -- whether regional, national or international group -- can often be misleading.Far better to take a wider view over a longer time period to form a good analysis.
That said, here are some of the latest numbers, released by the BLS on Friday, two days after the ER posting on "The New Normal" unemployment rate.
In the U.S., the jobless rate has been holding at just above 6 percent for months. The number for August was 6.1 percent, just a tick down from the 6.2 percent the month before, even as the nation's employers have been steadily hiring. Even so, the number of unemployed persons, at 9.6 million, "changed little," the BLS said.
Overall, the nation added 142,000 jobs in August, down from an average monthly gain of 212,000 over the past year. However, the labor force participation rate, which many economists consider a better indicator of employment health, changed little -- 62.8 percent -- "essentially unchanged since April." the BLS said.
Looking for signs of an improving economy? Look harder. The BLS reported no change in manufacturing, retail trade changed very little (down by 8,000 jobs), and employment in other major industries, including mining, wholesale trade, transportation and warehousing, information, financial activities, and government, all showed little change.
The areas of professional and business services, however, as well as leisure and hospitality, plus construction, all showed gains.
Otherwise, the length of the workweek, as well as overtime, showed no change, and average hourly earnings for all employees on private nonfarm payrolls rose by just 6 cents, to $24.53.
So are things getting better? For some, maybe. The number of longterm unemployed -- those jobless for at least six months -- dropped by 192,000 to a total of 3.0 million, according to the BLS report. However, it's still true that these folks account for nearly a third of all those unemployed.
Meanwhile, the good news for management is that productivity went up by 2.3 percent, and unit labor costs declined by 0.1 percent in the second quarter, the BLS reported.
And overall, personal income increased in July by 0.2 percent, even as personal expenditures fell 0.1 percent, the Census Bureau reported.
So it seem that those who have jobs are a tad more productive, and making a touch more money, but they're being more careful about their spending. All of which means that while things may not be getting worse, they're very slow in getting better.
And while it's true that many years ago, the so-called "full employment" level was when the unemployment rate was 4 percent, it's also true that many years ago, a gallon of gas cost 12 cents, a pack of cigarettes cost 35 cents, and the federal minimum wage was 50 cents an hour.
That was then. It ain't many years ago no more.
So I cheered up, and sure enough, things got worse.
Companies are hiring, but the pace of new jobs created has slackened, according to monthly statistics from the U.S. Bureau of Labor Statistics. Part of that, of course, could be the normal August slide, which the number crunchers try to account for by calculating a "seasonally adjusted annual rate." There are also the built-in hazards of telephone surveys. The sample may be too small, especially during vacation months or holiday periods when people are not home.
Nonetheless, surveys are useful, especially over time. In this case, a change over a single month may have little meaning, but when a trend is set over a six-month period, that's something to pay attention to.
In general, looking at one aspect of an economy -- whether regional, national or international group -- can often be misleading.Far better to take a wider view over a longer time period to form a good analysis.
That said, here are some of the latest numbers, released by the BLS on Friday, two days after the ER posting on "The New Normal" unemployment rate.
In the U.S., the jobless rate has been holding at just above 6 percent for months. The number for August was 6.1 percent, just a tick down from the 6.2 percent the month before, even as the nation's employers have been steadily hiring. Even so, the number of unemployed persons, at 9.6 million, "changed little," the BLS said.
Overall, the nation added 142,000 jobs in August, down from an average monthly gain of 212,000 over the past year. However, the labor force participation rate, which many economists consider a better indicator of employment health, changed little -- 62.8 percent -- "essentially unchanged since April." the BLS said.
Looking for signs of an improving economy? Look harder. The BLS reported no change in manufacturing, retail trade changed very little (down by 8,000 jobs), and employment in other major industries, including mining, wholesale trade, transportation and warehousing, information, financial activities, and government, all showed little change.
The areas of professional and business services, however, as well as leisure and hospitality, plus construction, all showed gains.
Otherwise, the length of the workweek, as well as overtime, showed no change, and average hourly earnings for all employees on private nonfarm payrolls rose by just 6 cents, to $24.53.
So are things getting better? For some, maybe. The number of longterm unemployed -- those jobless for at least six months -- dropped by 192,000 to a total of 3.0 million, according to the BLS report. However, it's still true that these folks account for nearly a third of all those unemployed.
Meanwhile, the good news for management is that productivity went up by 2.3 percent, and unit labor costs declined by 0.1 percent in the second quarter, the BLS reported.
And overall, personal income increased in July by 0.2 percent, even as personal expenditures fell 0.1 percent, the Census Bureau reported.
So it seem that those who have jobs are a tad more productive, and making a touch more money, but they're being more careful about their spending. All of which means that while things may not be getting worse, they're very slow in getting better.
And while it's true that many years ago, the so-called "full employment" level was when the unemployment rate was 4 percent, it's also true that many years ago, a gallon of gas cost 12 cents, a pack of cigarettes cost 35 cents, and the federal minimum wage was 50 cents an hour.
That was then. It ain't many years ago no more.
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