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Showing posts from June, 2010

Recovery or Doubledip?

      If a water pipe bursts inside your house, whom do you call, your plumber or your pastor? As ridiculous as this question sounds, it is a metaphor for the problem facing President Obama at this time. I am afraid he is going to call the pastor.       We are in the midst of a partial recovery from a reasonably deep recession, and the question for him is from whom to get advice - economists or ideologues. Should he seek advice from men who have devoted a lifetime to studying economics, or from conservative Democrats, Republicans, Tea Partiers and others who got us into this position during the reign of King George (2001-2009)? Should he trust the guidance of pilots who know the waters, or should he let the ones who steered us unto a sandbar take a second run at the beach?       In 1929 the economy was bustling along, and the Gross domestic Product value was at an all time high of $103.6 billion. Then the depression hit, and by 1933 GDP had sunk to $56B.       At that point the New

Why Do People Disagree With Me?

      My late mother-in-law was a sweet lady, and I loved her. She always gave lip service to the belief that a variety of people was a good thing, but I know that deep down she disapproved, at least slightly, of those whose lifestyle differed from hers. How do I know? The compression of the lips, or a slight shake of the head was a dead giveaway. After much thinking about it, I have concluded that we all have a similar unstated bias.       Semanticists have long known that we process reality through an unconscious filter: a dynamic pattern of attitudes, habits, internalized values, and modes of thinking. It is through this process that we relate ourselves to the world of things and people, observe and judge them, and express ourselves.       Some of the contents of this filter we receive at birth - certain talents or handicaps; others from our culture – vocabularies, games, dances, greetings ,etc. As a result, most of the things that “come naturally” to us we have actually absorbed

Straight From the Horse's Mouth

      Whenever a catastrophe occurs, people in high places are cast into the limelight, some unwillingly, and others because they want to beat everyone else to their fifteen minutes of fame. When that happens, they often come out with pearls of “wisdom,” sometimes speaking with insufficient information; at other times engaging their mouths before their brains are in gear. A classic example, of course, is the well publicized Bushism,…”Brownie, you’re doing a heck of a job.” The Gulf of Mexico Oil Spill is no exception. Here are a few examples: Tony Hayward, BP CEO: "What the hell have we done to deserve this?" (Is he kidding?) “I'd like my life back.” (So would thousands of Gulf Coast residents who depend on the Gulf for their livelihoods.) After arguing that safety has always been his top priority, “…that is why I am so devastated with this accident.” (BP has had 760 safety violations in the past five years, and paid $373 million in fines.) Carl-Henric Svanbe

California's New Election Law

      Those zany California voters have done it again. Back in 1978 they sowed the seeds of their present horrendous budget deficit by passing Proposition 13, the People's Initiative to Limit Property Taxation . Among other things, the proposition lowered property taxes by rolling back property values to their 1975 value, and restricted annual increases in assessed value of real property to an inflation factor, not to exceed 2% per year. It also prohibited reassessment of a new base year value except upon (a) change in ownership or (b) completion of new construction.       Because I had bought my property in 1973, I benefitted immensely from the proposition. When I sold it in 2004 the property taxes were approximately $700; in 2008 they were over $4000. The voters had successfully capped property taxes for long term residents and had made sure that tax revenues were well below the inflation rate. It was not the only factor that put California into its present budget predicament, b

The USA vs. the UK - Deja Vu All Over Again

      The calamity in the Gulf of Mexico is putting strains on the relationship between the USA and the UK. I can see both sides of the problem, but I think we have the better argument.       The British object to President Obama’s calling the bad guy in the Gulf “British Petroleum” instead of “BP.” (In 1998 British Petroleum merged with Amoco and became BP Amoco. In 2001 it formally renamed itself BP, and adopted the tag line “Beyond Petroleum”). They claim it is making the whole British Empire look bad.       I understand the British reluctance to having aspersions cast upon BP; stock price is affected by rumors or bad reputations of any company. Since the explosion of April 20th, BP’s stock price has dropped 50%, or about $90 billion dollars.       As Britain’s largest corporation, BP stock is held by almost every pension plan in the country; BP pays about 1/7 of all dividends paid in the UK. About 40% of its shares are held in Britain, and 39% are in the hands of US shareholders

Tradition

      tradition, n. the handing down of statements, beliefs, legends, customs, information, etc., from generation to generation, esp. by work of mouth, or by practice. Webster’s Encyclopedic Unabridged Dictionary.       In 1750 the ship Nancy arrived in Philadelphia carrying Henry William Stiegel, a German glassmaker and ironmaster. He was an active lay Lutheran and associate of Henry Muhlenberg, who is considered to be the patriarch of the Lutheran Church in the United States.       In 1772 Stiegel donated the land on which the Lutheran church in Manheim, Pennsylvania is now built. The deed stipulated that the cost of the land was “five shillings and ‘in the month of June yearly forever hereafter the rent on One Red Rose if the same shall be lawfully demanded.’”       It is doubtful whether the rose was actually paid to Stiegel, but in 1892, one hundred and twenty years after the deed containing the red rose clause was written, the idea of the annual payment was revived by a loca

Creativity

      When I was a working accountant, there was one comment which I heard time after time, not only in the business world, but in other settings as well, e.g., church councils, civic organizations, etc., and it irritated me every time I heard it: “We never did it that way before.” I always thought that if we had some system going for, say, five years, it may not need to be upgraded, but we should certainly consider that possibility.       Even before discussing any changes, the person who made that remark usually came up with several reasons why a new system would not work.       Today we often hear the catchphrase “think outside the box,” meaning to be creative. If Bill Gates, Steve Jobs, et. al. had not heeded that advice, I would not be writing this because no one would ever have heard of a blog. Of course, I also need to give credit to the inventor of the internet, Al Gore(?)       Almost anything can be done in several ways. I wish to thank the editor of The Fishwrapper , a pu

The Ump Makes A Bad Call

      On June 2nd, umpire Jim Joyce called Cleveland Indians’ runner Jason Donald safe when almost everyone in the stadium, as well as the entire TV viewing audience, knew he was really out by at least a full step. The exceptions were Joyce and Detroit Tigers’ pitcher Armando Galarraga, who was covering first base on the play. Joyce was wrong and Galarraga wasn’t sure. He had been called up from minor league team Toledo only 16 days earlier.       It was a bad call, but it would probably not have been the object of undo excitement if it had happened in another game; they happen all the time. But this game was special, the call cost Galarraga a perfect game – 27 batters and 27 outs.       In the entire history of major league baseball, there have been only 20 perfect games. Even Nolan Ryan, who threw seven no hit-no run games, never pitched a perfect game. Unbelievably, two of them occurred earlier this season. And this kid, who had been with the big club just over two weeks, was robb

Has Obama Met His Katrina?

      Many people are calling the BP oil spill Obama’s Katrina. The reference, of course, is to the inefficient response of the Federal government to the catastrophe incurred when hurricane Katrina came ashore along the Louisiana coastline in 2005. So how do the two events compare?       As a result of Katrina, at least 1,836 people lost their lives, and an estimated 1,000,000 people were redistributed from the gulf coast states to other areas. As of July 1, 2006 it was estimated New Orleans had lost almost 220,000 residents. On March 30, 2010, 260 families were still living in trailers provided by the Federal Emergency Management Agency.       The government has been criticized for its slow response to Katrina, but under the National Response Plan, the responsibility for the management of such disasters lies with local authorities until they ask for help. New Orleans mayor Ray Nagin had ordered an involuntary evacuation the day before the storm hit, but there were problems arranging