Thoughts Before The Alarm Sounds

      The founding fathers left us with two concise views of the role they expected government to play: In the Declaration of Independence, Thomas Jefferson wrote, “...all Men are created equal, that they are endowed by their Creator with certain unalienable Rights, that among these are Life, Liberty, and the Pursuit of Happiness – That to secure these Rights, Governments are instituted among Men...” The Preamble to the Constitution states, “...in order to form a more perfect union, establish justice, insure domestic tranquility, provide for the common defense, promote the general welfare, and secure the blessings of liberty to ourselves and our posterity, [we] do ordain and establish this Constitution for the United States of America.”       Because of the makeup of society, however, the fathers were not quite as principled, at least by today's standards, as one would expect from the foregoing statements. Electors in federal...

     The decision to raise the debt limit of the United States Government should be a no-brainer, but the idiots in Washington seem to be unable to rise to that level. When a person, organization, and especially a nation makes a promise to pay, one should be able to expect that promise to be kept. Is it asking too much to assume the United States will pay your government bond when it comes due?      I find it hard to see the difference between demanding concessions for keeping one's word, and someone who takes a hostage and demands money for a safe return - both are bandits! This whole thing reminds me of little boys holding a pissing contest behind the barn.      I know there are legitimate arguments concerning government revenues and expenditures, tax reforms, entitlements, discretionary items, jobs, recession, wars, and a host of other subjects, but whether or not to throw the government into default is not one of them. Mo...

     The numbers being bandied about in Washington these days are so big that most non-mathematicians, especially politicians, can't conceive of their magnitude. So let me see if I can give you some idea of what these guys are talking about.      There are thousands of web sites one can visit in order to visualize large numbers, but for my purpose I wish to focus on just one number: $10B. You can either do the arithmetic or take my word for it: this would be a stack of one-dollar bills approximately 678 miles high.      Now let this $10B be represented by a standard pack of playing cards. The question is: If we piled up packs of cards to the height of the Federal Budget (Note 1) , how many packs would we need? The answer is 345 packs, or a 17.4-foot-high stack! Keep in mind: each pack represents a 678-mile-high stack of one-dollar bills!      But of that 368 pack budget, 211 packs have been set aside as ...

     Of all the wise politicians (another oxymoron) in Washington, who do you think made the following remark: “Government has to start living within its means, just like families do. We have to cut the spending we can’t afford so we can put the economy on sounder footing, and give our businesses the confidence they need to grow and create jobs.”? Rep. John Boehner R-OH), Sen. Rand Paul (R-Ky.), Rep. Michele Bachmann (R-Minn.) or Sen. Jim DeMint (R-S.C.).      Although it could have been any of these, the quote is actually from President Obama's last weekend address to the nation. Apparently he was either joking, taken leave of his senses, or joined the Republican party. This is the same old gibberish the GOP has been mouthing since the days of Herbert Hoover. Let's look at these suggestions one at a time.      “Government has to start living within its means, just like families do.” The government is not a family – one excel...

     It should come as no surprise to readers of this blog to learn that the transfer of resources to the super-rich from everyone else is well underway. For details see the series “The Recession Is Over For Some People...” posted between 16 February and 18 March, 2011. A May, 2011, study by the Center for Labor Market Studies of Northeastern University , Boston, confirms it. For my purpose, two findings from the study are relevant:      (1) Using the lowest point, 30 June 2009, of the recent recession as the base figure, as of 30 April 2011, real corporate profits increased 39.6%, the Dow Jones Industrial Average increased 45.8%, and Average Real Weekly Earnings of the Private Sector decreased 1.0%.      (2) During the same period, Annualized National Income grew by $505B. While corporations' share of the growth was 92%, the share going to wages and salaries was 0%.      A recent article in Forbes provide...

     If you are not into mathematics, don't worry – you can skip that part and still understand the discussion. But here are a few items that I find somewhat intriguing, and I hope you do too.      The Monty Hall Problem: I discussed this subject on 9 March 2010, so you can read the details there if you wish. Briefly, Monty Hall was the emcee of the game show “Let’s Make A Deal.” The contestant had a choice of three doors to open; behind one was a prize, and goats were hidden behind the other two. After the contestant chose one of the doors, Hall, who knew where the prize was, opened one of the doors behind which was a goat. The contestant was then given a choice: he could either open the door which was his original choice, or he could switch and open the other closed door.      Not surprisingly, most people opted to stay with their original choice. It seems logical that since there are now only two doors from which to choose...