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Author: Isaac
People are twittering over the Yankees signing C.C. Sabathia to a $160 million dollar contract over 7 years. “How could they be so caviler when the economy is so bad? How can they spend that kind of money when there are people out of jobs and losing their houses?” It’s pretty simple, signing him will make them money. If a company purchased a piece of machinery for that much money, who would complain? The Yankees aren’t “showing off” or spending money for the hell of it. They aren’t some spoiled rich kid spending like an idiot, they are a business and they think they are going to make money by spending this money. What’s so hard to understand?
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Reality is not optional
The more I hear, the more I shake my head. The big three auto companies’ problems are not a sudden catastrophe that can actually be avoided. Many people in DC seem to think that with just the right shuffling of money, things could be very different. They say we need to do something in order to “save jobs” and prevent a plunge in the economy. They act as if those are things a maniacal evil genius is cooking up, as if those things are something that might happen for no reason at all…
Folks, those jobs being lost and those companies’ financial troubles aren’t random. They reflect the way things actually are. What the people up in DC are trying to do is to change the underlying reality of things. It ain’t going to happen. Those companies have already failed, those workers that are going to lose their jobs are already not needed. A prosperous economy is not based on jobs being kept alive by government fiat, it is based on people providing goods and services that are wanted by consumers. Consumers have been telling the Detroit automakers what they think for years via car sales. If those companies aren’t giving people what they want (both in product and price of that product) then they aren’t contributing to a prosperous economy, they are a drag on it. WHen those companies go under, or at least scale back, all sorts of resources will be freed up to go towards things that will contribute to our economy. Steel, rubber, labor, etc. will be able to be used much more efficiently.
It’ll take a little time, especially in the case of the labor, but it will get sorted out. The longer we prolong the process, the more pain that will be inflicted. Let things go on their natural path, it’s the only way to allow an economy to be prosperous.
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Gratified and disappointed
The Senate wasn’t able to come together and pass the auto bailout package. For that, I’m happy. We’ll see if Bush caves and appropriates money, he better not since the legislative body didn’t…
I was a little disappointed that none of the objections to the bill (that I could see) were on general principle. Instead, everyone disagreed on how budgets should be cut at the companies. Some said union contracts need to come down now, some were saying executive compensation needed to come down, there were talks about how much they should guarantee their bonds, etc. Is there anyone out there that believes that the congress and the senate would make good micro managers of any business? All of those things might be needed, but the congress is that last body you want making those decisions. It looks like all of those things will happen in bankruptcy, if we’re lucky…
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Bailout predictions
I have to say that I continue to be amazed that there is legitimate resistance to the auto company bailout. As free as both houses have been with money, I figured that this current thing was a done deal.
As you might imagine, I am no fan of this thing. There is zero chance that any sort of government appointed car czar will have a good impact on those companies… I have no idea of the bailout will squeak through the Senate or not. I hope it doesn’t and it looks like there will be some sort of fight for it at least… I wonder what will have to be thrown in to sweeten the deal enough to bring enough people over to get it passed like the last bailout bill was…
Anyway, here are my predictions. If the bill passes, this will only be the first of several requests for money. Those companies are bleeding money at an amazing rate and the government is going to show them how to be fiscally responsible? It will be good money after bad and the companies will have to completely reorganize anyway.
If the bill doesn’t pass, the companies will have to file for chapter 11 and they will reorganize. They will reduce their capacity, restructure union contracts, and lay off a ton of people. All of these bad things will be blamed on the lack of bailout money and not on the incompetence of management…
It has been pointed out that this is a bit of a “prisoner’s dilemma.” There is a ton of excess car manufacturing capacity worldwide. That excess needs to go away in order to make the industry profitable and competitive. The trouble is that every country wants the other country’s capacity to shrink, so they will bolster their own. The result? All of the car manufacturers do poorly because of the excess capacity. By moving to prop up the industry, the whole thing stays bad. Yet another chapter of massive distortions caused by government. When will they learn?
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Gustatory lows and highs
I decided I wanted chicken palak (an Indian spinach dish I grew to love while I was in Yemen) while I was in the gym on sat. This had been an ongoing wish from me, I had been looking at various recipes for a while. So I stopped by the store on the way home to pick up the ingrediants. Got home and realized that I had forgotten the onions and garlic. DOH! It was too late to go back to the store and have any chance of eating it for dinner.
So the next morning I went to the store, got the rest of the ingredients, and set about making it. The sauce looked good out of the blender, but I could never get it to taste right. Not only that, I couldn’t get it to the point that I wanted to eat it… I think the problem was that I was way out of my depth using spices like that. If I were cooking pork chops, I’d have a pretty good idea of what is going to work and what isn’t. Combinations of cinnamon, cloves, bay leaves, red and green chilies, cardamon, and ginger? Not so much… I’ve bookmarked an Indian cooking cookbook for rank amateurs on my Amazon wish list that I will get after the holidays. I need some real guidance before I try tackling that again…
Later that night, Dad, Butler, and myself went down to VA Beach to go see Nathan. He had picked out a restaurant that he had wanted to try for a while called The Terrapin. I ordered a salad, and when I got it, I said, “OK, here we go…” It was the classic teeny-weeny thing that looked nice, but on first sight looked silly because it was so small. Well, it was tasty, and Nathan’s appetizer of their fancy mac and cheese made me hopeful. The entrees were hits for all of us. They all had some sort of fish dish, I got a chicken thing. They were all decently sized and cooked to perfection. For dessert, I had a sampling of three freshly made ice creams and sorbet. Their berry sorbet was amazing….
I don’t usually drink alcohol, but I do have a weakness for Cognac. I might have one for brandies in general, but so far I have only sampled some cognacs… Luckily for me, I only crave them after a really good meal, and last night was one of those times.
I ordered a Remy Maitrtin VSOP. Oddly, the waiter asked me if I wanted it on the rocks. Huh? Do people really do that? What a waste that would be.. Anyway, one of the delights of drinking that stuff is smelling it. We’ve all seen the brandy snifters, the proper technique (as far as I can tell) is to hold the glass in your palm to warm it and swirl it around in order to get the most out of the olfactory experience. This was the first time that I had been given a slightly warm glass, I put my nose down to smell and WHOOOSH! It was like huffing Cognac… Quite a bit more intense than I was bargaining for. I’m not saying it was unpleasant, but wow…
Anyway, it was a nice ending to a great meal. As badly as my day started off food-wise, it ended that well. Great company and great food is as good a way to end an evening as I can think of.
“I believe the Obama years will cause a crisis for progressivism roughly comparable to what the Bush years have brought upon libertarianism.”
That’s Tyler Cowan over at Marginal Revolution. Tyler is pretty influential in the blogosphere, and he’s an astute commentator on economic issues. I think he has a decent chance of being right.
There could be a couple of reasons his thought might come to pass. None of them involve Obama not wanting to help people. Good intentions and governments do not usually make for a good combo. The most likely problem will be the typical political/bureaucratic one. The program will be founded on all the best intentions but the political process in getting it passed and the actual running of it make a mess out of it.
Even if by some miracle a program is not plagued by those problems, you can bet our old friend “unintended consequences” will rear its ugly head. See the Ethanol program for an example of that…
So as usual, I anticipate whatever government programs that come out of the next administration will be, at best, too expensive. At worst, they will inflict significant damage to the economy or to the people that the program is aimed towards. It won’t be because Obama is a democrat, because he is stupid, or because they will be pursuing something evil, it will be because they used the wrong tool to get the job done. It will be because they tried to make the government responsible for things that it can’t be responsible for. I can only hope that this crisis in progressivism comes soon…
In case you missed it, a hockey player in the NHL (Sean Avery) said a rather crude thing about his ex on TV and now has been suspended for 6 games because of it. Keep in mind that this sort of thing wouldn’t have made people bat an eyelash in any of the other sports. Sure, it would have gotten some press and people would have been pissed, but nothing would really happen to them. To me, this shows what a difference there is between hockey players and all of the other players of sports in the US. A football player is in big legal trouble over an illegal gun, basketball players are constantly getting in trouble, baseball had its drug issues, etc. In the NHL, if you say something nasty on TV, you’re in trouble.
“Yeah, but c’mon, those guys beat each other up all the time! The NHL thinks it’s Ok for a guy to give a beat down to someone, something that would be considered assault anywhere else, but you nail him for saying something about his ex? That’s insane!” Well, yeah, it is a little odd, but there is an explanation. You see, when guys fight in the NHL, it is almost always about a character issue. If you go after a smaller, talented player, the big boys will come back and beat the crap out of you. If you hit the goalie, whoever is closest to you from the other team is honor bound to start pounding on you. Occasionally, the bruiser from one team will start a fight with the thug on the other side just to get people fired up, but usually, there is a sense of justice involved in the fights. You are expected to be a stand up guy and play clean. If you’re not, you’re going to lose teeth…
And really, if you are going to do things like hit a goalie, make cheap shots, spear someone, or even crosscheck someone, maybe you need some sense beaten into you. The violence is almost (almost) always in response to other violence. I don’t know if it is a result of the justice system in hockey or not, but hockey players are angels off the ice as compared to other sports. They are held to a very high standard by the league. So when someone does something really objectionable on the ice, the “correction” is usually pretty swift in coming. But what to do about a guy that does something nasty off the ice? You can’t go jump the guy, so you suspend him and fine him to within an inch of his life.
Say what you want about the sport, but the NHL has its act together. I just wish the other leagues would learn something from them…
Here’s the Daily show’s take on the Mumbai mess (at the end, don’t know why there’s so much space…)I think that’s hilarious, I really do. John basically summed up my feelings when I was watching that on the news, I was yelling along too. There’s only one little problem, this violence was not about establishing a world wide caliphate. This was about Kashmir.
Usually, when something big like this happens, there are political motives rather than religious ones at play. The Kashmir issue is a political one although the parties involved are split along religious lines. The same could be true of the day to day demands and goals of Al-Queda. They want foreigners to leave the Saudi peninsula, they want the US to get out of Iraq and Afghanistan, etc. Those are all political issues. They use religion to attract and recruit people for political ends. We shouldn’t fall into the same trap.
There is indeed religious violence in the world. Men killing woman because they aren’t wearing hijab, wackos blowing up abortion clinics, etc. are all examples. Perhaps the attackers in Mumbai were indeed personally motivated by religious extremism, but the aim of the operation was to try to cause a conflict in Kashmir.
Here’s my bet. I bet that if these people were referred to as Kashmiri separatists instead of Islamic extremists, we in the US would not have heard nearly as much about it. We’re more willing to stomach political violence than religious violence. That’s why Hitler is so universally reviled while Stalin, Pol Pot, Kim Jong-il and Mao are not thought about in the slightest.
Whenever we hear the media trumpet religious violence, we should take a step back and ask ourselves if the aim of that violence is actually political in nature. Violence should always be decried of course, but let’s blame the right problems, shall we?
Last night, several of my friends and I were being greeted as the newest foreign members of parliament in England. Te dream was mostly about the pomp and newness of being in that sort of position.
Well, that’s stupid, right? You’re right, my high school and college friends would never be elected… Oh, you mean the bit about foreigners being in a legislative body? I dunno, that doesn’t seem too outlandish to me. If you think about it, the reason we don’t want to have foreigners in our congress is because they might pursue actions that would be detrimental to the US. How is that different than what our congressmen and senators do every day?
Let’s ignore the really big things for a sec. Let’s just consider the typical, run of the mill appropriations bills. How often does a senator sponsor a bill that uses federal funds to pay for things in his state? How often do our elected representatives pursue federal policy that would benefit certain businesses? You can be sure that if something is good for a particular business, it’s bad for another. And any time federal funds are used for something in one state, all of the others are paying far more than that particular state.
In short, I don’t see how foreigners in congress would be any more damaging than the people we already have. As a matter of fact, I can imagine that having a representative of any country that we are about to do something with (invade, trade issues, etc.) could actually help. It’ll never happen of course, but trying to see the difference between “them” and our current people we’ve elected isn’t as obvious as you might think…