Author: Isaac

Categories
economics free market politics

Another ridiculous Obama ad

I just saw another Obama campaign ad talking about jobs shipped overseas. This one laments that workers in the Carolinas the sewed the American flag had their jobs sent overseas. They lost not only their jobs, but their “dignity” as well.

Where to start? OK, first of all, those people were either going to lose their jobs to increased mechanization or outsourcing. Odds are that the investment in new machinery was too expensive, so the company could either outsource the labor, or go out of business. Would Obama rather have had the company go under? The idea that we can force companies to keep employees when it is not viable and not to have any bad consequences is naive and comical…

Second of all, and this may be what gets me more wound up, is since when are companies responsible for the “dignity” of their workers? More importantly, since when is the federal government responsible? This has to be one of the more obvious examples of the government overstepping it’s bounds. Dignity is up to the individual, not their employers and certainly not the government. I wish that there was at least the suggestion that the government cannot do certain things let alone hint that there are things that it shouldn’t do….

Categories
economics politics

Problems with Obama and jobs

I keep hearing the ad where he says that companies that “send AMerican jobs overseas” will not get tax breaks. It’s an odd thing to say and do really. First off, which tax breaks is he talking about? Why are there tax breaks to begin with? Don’t get me wrong, I favor the least amount of taxes n general, but when certain industries or companies get “tax breaks,” it’s really just a way to pay back the donations that have flowed from them.

What it sounds like he is saying is that we should give tax breaks to companies that create jobs in the US, or at least they don’t ship them out. Read the first paragraph again… Any time that companies or industries are given preferential treatment, it means that there is some serious lobbying going on and a fat bonus to the management of that company.

Here’s what’s going to happen… There will be some companies that it is easier to give jobs to Americans than others. Giving them a tax benefit is going to skew what types of industries and businesses will be profitable to start. Ideally, no government would distort things like that and ideally, companies can be started in whatever industry people can figure out how to make a profit, regardless where the labor is. We want more businesses, not fewer. Even businesses that rely totally on foreign labor do hire some people stateside, isn’t that a good thing?

Categories
economics free market

Things to remember about the great depression

I keep hearing comparisons to the great depressions when people talk about banks closing, markets tumbling, etc. It’s important to remember that what we are experiencing is a financial meltdown, not an economic one… so far. The government has stepped in to “stabilize” markets. The result? Wild wild volatility (look for another big drop tomorrow) in the stock markets and an unknown effect on the financial institutions that they are trying so desperately to save.

One thing that we should remember about the great depression is how long it was and why it was that long. We have to remember that government cannot produce jobs, productivity, or wealth unless it takes it from somewhere else. Like it or not, it is the private sector that drives an economy. If you want to jump start the economy, make sure that businesses can make good decisions. This is a rather good podcast about the great depression. I found it quite illuminating, the key thing I got out of it was that the length of the depression can mostly be laid at the government’s feet, more specifically at the feet of FDR and Keynes.

FDR, following the advice of Keynes, managed to inject so much uncertainty into markets that the private sector was unwilling to invest for a very long time. It’s a lesson we should remember these days. Nobody has a good idea what kind of effect the latest shenanigans will have on wall street. And nobody is sure how it will impact the credit markets. Left to their own devices, they would have had to figure something out, now they’re all waiting for the feds to figure things out instead. I can only hope that lessons have been learned and not forgotten…

Categories
odds and ends

Minnesota… really?

A student of mine in Yemen was telling me how much she wanted to go to the US. “Is there any place in particular that you’d like to go? I asked her. “Oh yes,” she nodded her head enthusiastically, “I really want to go to Minnesota…”

Really. That caught me off guard. I was expecting NYC, California, maybe even Florida, but Minnesota? It turns out that she has a cousin living in Minnesota and is constantly regaled with stories about how beautiful the state is. The pictures really made her want to come even more.

Huh. I never really considered Minnesota an ugly place, but I always imagined it to be rather nondescript. That puzzled me for a while and I eventually forgot about it. Yesterday, as I was driving back to Gloucester from DC I remembered her. I was looking at some rather nondescript farmland a little after sunset. The leaves have just started to turn and a full moon was big and just over the tree line.

When I first got back, I was overwhelmed by all the green. All the different shades, all over the place, it was just too much. It took a week for that to wear off. I’ve missed two falls, and I’ve missed them. The view of that farm, the smell, and the light were beautiful. Coming from Yemen, I get it now. We live in a beautiful place…

Categories
technology

GAHHH! New Apple laptops… No Firewire!

And no, that’s not a good GAHH! Don’t get me wrong, the new additions sound really nice. The aluminum case and the new graphics chips are great upgrades. I’m not to keen on the no button trackpad, but who knows, maybe I’d get used to it. Also, I think the new two tone look is fugly, but that obviously doesn’t affect the usefulness. My gripe, and it’s a big one, is that there is no firewire port on the macbook! Yeah, I guess I could spring for the macbook pro, but that’s 2 grand and a larger computer. It’s just a port Apple, $700 (and less) windows machines have this port, it’s ridiculous that the new macbook doesn’t have one.

I had been thinking about my next computer being an audio one. Without a firewire port, that looks doubtful. USB is fine, if a little slow, for transferring files, but audio and video uses really need a firewire port. I can’t believe this… I may actually buy a windows computer for my audio work. I’d never get it near the internet, there’s just too many problems with all the viruses and malware out there. The necessary anti-virus stuff causes even more problems as far as I can tell. ARGGH! Why couldn’t they put that port on a reasonably priced machine?

Categories
economics free market freedom of choice

Fascism vs. socialism

Just to pick up on my last post, it’s important to remember the differences between these two evils. In socialism, the government is the supplier of goods and services. Under a fascist government, the government controls businesses in order to further the aims of the government. So, nationalized healthcare where the government is the only supplier of hospitals, doctors, medicines, etc. would be an example of a socialist program. The current bank issues don’t really fall into that category, the banks still exist outside of the government, and there are plenty of banks that are not involved so you can choose one of them if you want.

Fascism is all about the vision of “the country” by the powers in charge. The basic philosophy can be summed up in that awful speech by Kennedy, “Ask not what your country can do for you, ask what can I do for my country.” This was considered uplifting and inspiring at the time. People quickly figured out what it really meant when the government stopped asking and forced people to go die in Vietnam. Nationalism is intrinsically tied up in fascism. The belief that the state is the most important thing and that citizens exist to further the aims of the government is the driving force behind fascism. Can you see why I worry about this so much?

The purchasing of bank shares is rather ominous in my mind. There are some technical issues that need to be addressed. Will the treasury have voting shares in the bank ownership? If regulators feel that a bank is being mismanaged, will they need to bring suit against the treasury department? Can the same branch of the government sue itself?

More worrying to me is the political pressure that could be brought to bear in bank operations. It would be far better to allow those banks to go under. If banks are left alone, ones that are badly managed will go away either through bankruptcy or being bought out. There is the worry that banks that the government have a share in will no longer be as worried about little things like making a profit but will be used to further political ends. Sounds ridiculous? Look at Fannie and Freddy, economists have been warning us of the eventual collapse of those institutions for decades. Because they were tied to the government and had to follow government mandates, we all pay to bail them out.

Why does it matter? With enough government money being spread around, it impacts you and me in the long run. All of these things need to be paid for eventually. We could raise taxes, the government could just print more money (and then we get all the wonderful effects of inflation to deal with) or the government could just default on the loans. None of those things are good, and they’re all avoidable. All we have to do is not fall into the trap of relying on the government to solve things. The line of what should be the realm of government and private enterprise has been dangerously blurred…

Categories
economics free market

It’s late and I’m not thinking straight…

I’ll write more on the bank thing later, but I do want to say something now about the ongoing banking thing. I’ve heard some people worried about the “socialist” implications of the government owning parts of banks. I think the thing we need to worry about more is fascism. The government using private businesses to accomplish aims that are important to it. Surely the government knows what’s best, surely they will do what is in the best interest of us all. We should always worry when the government starts to exert new controls. At what point do those ownership shares get subjected to the political process? Be afraid, be very afraid…

Categories
odds and ends

Been up in NoVA

I managed to have a good time up here. Saw friends from my DC area days, it was good to see everyone. I ended up staying several days more than I thought I would. Mom came up (Rick usually goes to Gloucester) and there was a long weekend, so I stuck around…

I got two job offers while I was up here. My old job wants me back. I’m conflicted about that. One of the reasons I left was to start a new life, do something different. On the other hand, I would get paid quite a bit better there than anywhere near mom’s place. I was also offered (I’m not sure how seriously) a gig teaching photography in a workshop setting. That would be a nice add on to a regular job, but it would never work on its own… I’ll see where that goes…

There were some bad things too though. One of the guys that I worked with at Penn became a widow. That’s rough. I think he’s flying back to Ghana, so he won’t be around for a while. I met with a friend of mine on saturday along with his wife and kids. The next morning, she had a stroke! This really surprised us all, she’s only 40ish… Anyway, she seems to be recovering, but I’m wishing them well. Get well soon Cindy!

So it was a mixed bag, I am glad I came up. Now, back to my normal routine…

Categories
sports

They’ll break your heart

That’s what my uncle told me in 1983 when I informed him I was a Cub’s fan. This was easily the best Cubs team I’ve ever seen, they were the best team in the league. They then proceeded to give the worst possible performance I have ever seen in the post-season. It’s one thing to lose, it’s quite another to never show up. I know that in the grand scheme of things, this isn’t a big deal, but it still sucks. I’m not thinking of next year, It’s hockey season now. Hopefully my Caps will take my mind off of this…

Categories
economics

Riddle me this…

What are we improving with the bailout? The thing that “sold” the bailout package was the fear that credit would be hard to come by. Of course, banks are still lending, and if you have good credit, there are banks that will lend to you. Well, then we started to hear horror stories about not only large organizations failing because credit had been cut off, but smaller businesses too. I heard worries that companies wouldn’t be able to make payroll because of a credit crunch. Really? No, REALLY?

I’m really hoping that it isn’t a common business practice to use credit to cover regular operating coasts. I understand the need for credit, especially for buying inventory. A company buys things and then they have 30 days to pay for it. Thats a really short term form of credit, and it’s between two businesses, banks are not usually involved. Businesses can get loans based on outstanding bills, and I can understand that being cut off when there’s a credit crunch. But really, credit shouldn’t be used for regular things like payroll. I can only think of two reasons to do that.

1) Businesses really are strapped for cash and credit is what they need to grease the wheels.

2) Credit is so cheap that you might as well make use of it.

I’m guessing that #2 is the more likely. So here’s the question, do we really want to revert back to a point where credit was so cheap and easy that it is used as a matter of course? Wouldn’t we be better off if businesses were required to mostly operate out of cash flow? I’m still wondering what the long term consequences of this bill will be. I’m wondering if the old status quo (which is what we are trying to get back to) is what caused so many people to go into excessive debt and make so many businesses reliant on credit.

For example, I’ve been lead to believe that California is having trouble finding someone to give them loans. Here’s the thing, California has an enormous debt. before all of this stuff happened, they never considered the possibility of the state not being able to get a loan. Now that the credit markets have shrunk, they can’t borrow any more. Isn’t that a good thing? Under the old system, they were able to go further and further into debt, how is that better? My gut feeling (and this stuff is still too diffuse to go on anything other than gut feelings) is that propping up bad debt is going to lead to even more bad debt. We should take the hit, write off the bad debt, and start again with the more conservative credit system that is developing…