The number one song in America is "Ninety-nine Unemployment Checks in the Mail" (sung to the tune of "Ninety-nine Bottles of Beer"). The catchy lyrics, written by Rep. Nancy Pelosi, got much more air play than traditional holiday music during the past few weeks.
Before long, West Virginia lawmakers will be singing Nancy's song and raising unemployment compensation premiums. The popularity of "ninety-nine weeks of unemployment checks" has drained the fund (again). For the second time in two years, politicians will raise premiums rather than cut benefits, arguing that you cannot put a price on compassion.
Extending unemployment benefits to 99 weeks may seem compassionate, but creating a long-term dole is a cruel hoax. Here are some fallacies about the dole.
Fallacy 1: The unemployed are required to accept suitable employment offers; they may reject unsuitable employment and continue to draw benefits. "Suitable" employment generally means a comparable or better job.
In a recession, the suitable jobs disappear first, e.g., the housing industry is in a deep downturn. If there is less demand for oak flooring, then there is less demand for Appalachian oak lumber. The local sawyer is laid off, as are most sawyers within a 50-mile radius.
There are no suitable jobs for the local sawyer. The sawyer has a choice between working for less money or drawing unemployment. He will probably choose the latter, even though he could earn more money by taking a lesser job because unemployment compensation has been sold as an entitlement similar to paid vacation.
Fallacy 2: Week 100 arrives, and jobless benefits expire. The unemployed worker accepts lesser employment. When he returns to work, he finds out that technology has changed the workplace. When he last worked, he was proficient using Windows XP. Now he has to learn Windows 7 just to get up to speed in this "lesser" job.
Spending two years away from the modern workplace guarantees that one's work skills will deteriorate. Not only does technology change, but so do markets. And in week 100, our unemployed subject very well may accept a job description that did not even exist when he last worked.
Fallacy 3: A middle-aged worker drawing the maximum, or near-maximum, jobless benefit can get by financially. But the worker has lost two of his most productive work years if he takes that route. The worker will not realize the cost of his "two-year vacation" until he reaches his 50s. Then he learns one of life's cruel ironies -- he doesn't have the stamina that he did in his 30s. He also will learn that businesses want to hire 30-somethings but avoid hiring 50-somethings.
This worker also will learn the hard way that the money he saved when he was 30 has grown in value. The money he saves at age 55 will grow very little before he retires.
Fallacy 4: When unemployment premiums go up, there is less money for a business to spend on equipment, facilities, wages and benefits. Politicians don't seem to understand the macro effect of this tax increase. Indeed, politicians seem to have tunnel-vision regarding unemployment compensation premiums as evidenced when Rep. Pelosi declared that unemployment checks stimulated economic development because the unemployed spend all of that money.
There is no economic theory -- not even Marxism -- that says long-term unemployment stimulates a nation's economy.
Fallacy 5: This is the "Atlas Shrugged" effect. Productive, well-run businesses are taxed to pay for these long-term unemployment benefits. Rep. Pelosi's philosophy regarding long-term unemployment benefits reads like a scene out of Ayn Rand's novel. As the novel suggests, you can only bleed the productive businesses for so long before they rebel and move their production to lower cost states or overseas.
Fallacy 6: After the unemployed worker has slept in for three weeks, he has gotten out of the routine of going to work. You cannot measure this effect like you could lost earnings, but most people will lose, or greatly diminish, their sense of self-worth the longer their idleness continues.
The Legislature raised unemployment premiums 50 percent in 2009. We've blown through that money in less than two years. So, will the coming premium increase be even higher?
West Virginia has been down this road before. Some 20 years ago, the state borrowed heavily from the federal unemployment fund. To pay the federal loan back, the state taxed workers and businesses alike for about four years.
Yes, Nancy, unemployment checks do stimulate the economy -- in the worst ways possible.
Friday, January 7, 2011
Monday, December 20, 2010
Great Moments in Wintertime Literature
It was the night before Christmas, and it was snowy—very snowy—but not quite snowy enough to suit the tastes of the sometimes-intransigent Tiny Tim (grandson of Martin Chuzzlewit, who is not to be confused with the always-pleasant lad, Tiny Tim Cratchit, son of Bob (nee Robert) who was formerly employed at Scrooge and Marley), because Mr. Ebenezer Scrooge, to the rue of Seth Pecksniff, had already given Tiny Tim Chuzzlewit his Christmas present, a Flexible Flyer sled, and the snow was not deep enough to cushion the Baker Street cobblestones (actually large gravels washed up on the Cornish coast and used as London pavers), so the sled runners scraped on the cobblestones making a terrible, caterwauling racket, though, quite frankly, not all that caterwauling nor all that terrible, because snow, as you know, tends to muffle noise, causing the noise to dissipate rather quickly due to the phenomenon of the Doppler effect, which being something of a scientific law, the Doppler effect works just as well on Baker Street Hill as it does on the plains of Kansas, a flat or “flattish” landscape, where it presumably, and for comparison sake, rains as hard as it does on the plains in Spain (affirmed by the noted meteorologist Prof. Henry Higgins), and while the same can be said of snow in Kansas, Spain and London, at least regarding the application of the physical laws known as the “Doppler effect” at the same precisely-measured elevation above sea level as Baker Street Hill, and meaning that snow, whether wet snow or dry snow or icy, granular snow, compares equally in all three locations, the same outcome—the muffling effect—does not apply to the snows of Vermont, for as you must have been taught in public school, the man that Vermonters called “Robert Frost” (their white-haired apparition of “Jack Frost” as he is known throughout the rest of New England) wrote poetically of snow and its many pleasing qualities, not the least of which is the very noisiness of snow that the snow itself makes when it falls from the heavens and lands in the forest where, ironically indeed, trees do not make a sound at all when they fall in the same forest as does Vermont snow, yet Vermont snow does make noise if Robert Frost is to be believed, and he may be infallible in so far as we can determine, because these forests are populated wholly by maple-syrup trees, which of course, give the Green Mountains their name, at least in summer, but perhaps not in autumn as maple trees turn a blazing orange-red at that time of year, but as Robert Frost seemed to be a snow-creature—the Yeti poet, as Vermont Buddhists call him—he would not know of leaves, an ignorance that manifested itself in his once taking the wrong road in a yellow wood, and he probably knew not much about people, Buddhists or other ilk, as he often stopped by woods on snowy evenings, and further, would stop his horse-drawn sleigh without any farmhouse near, which in turn, caused his horse to give his harness bells a shake to warn (reportedly; albeit a human reaction in most cases) Vermont folk of the Yeti poet’s presence, but regardless of how often or how hard the horse jingled the harness bells, the only reply that the horse would hear was the sweep of easy wind and downy flake.
Another great moment in wintertime literature brought to you by David Allen.
MERRY CHRISTMAS
Another great moment in wintertime literature brought to you by David Allen.
MERRY CHRISTMAS
Friday, December 3, 2010
Where is that assignment with FOX News?
I am going to tell you a story that may well jeopardize my career as a contributor to The State Journal. I have kept this story secret for many years, but now it is time for me to fess up.
Some 20 years ago, I was foggy-brained enough to believe in the mission of public radio. I was even a monetary contributor to West Virginia Public Radio. I enjoyed listening to the Saturday opera and "Prairie Home Companion." I also fell swoon to the mellowing liberalism of "All Things Considered." I wanted to believe I could be tolerant of liberals, which, upon reflection, is what held me back for years from becoming an opinion writer for The State Journal.
Then one evening, while I was tuned to "All Things Considered," I had a revelation. An ATC reporter was broadcasting from the apartment of a San Francisco man who collected Sonia Henie memorabilia. If you don't recall her, Ms. Henie was an Olympic figure skating champion from Norway who appeared in more than a dozen films.
The collector had quite a lot of Ms. Henie's memorabilia, and you could tell that he had decorated his apartment almost completely with her mementos. But he had gone too far (in my opinion). He had Sonia Henie's underwear framed under glass and hanging on the wall.
It did not surprise me that a San Francisco man cherished Sonia Henie's underwear to the point that he had it framed. After all, there are a lot of San Franciscans of Norwegian descent. Garrison Keillor once considered airing a Norwegian-themed show from San Francisco and calling it "Bay Companion" ("Fjord Companion" in Scandinavian distribution).
But the Henie underwear show was too much for me. I figured that if public radio had the money to air a story about a movie star's framed underwear, then it didn't need my help anymore.
Don't get me wrong. I have nothing against collecting women's underwear. I used to collect women's underwear myself, but I had the good sense to keep it where it belonged -- in the glove box of my pickup truck.
I tell this story of my public radio resentment so that I will be renounced as a State Journal contributor. I want my Juan Williams moment. I want a shot at the big money at FOX News.
I must say that I owe my decision to come clean about public radio to none other than Sen. Jay Rockefeller. Had he not had the fortitude to recently denounce FOX News and MSNBC at a Senate committee hearing, then I would not be telling you about my falling out with public radio.
I also owe a measure of thanks to former NPR contributor Juan Williams because he had the inner strength to tell people that he felt uncomfortable seeing people in Muslim dress waiting to board his flight. I just hope that my story rises to that level of reprisal from National Public Radio.
I am told that Sen. Rockefeller knows people who know people who run the public broadcasting empire. If Sen. Rockefeller could use his connections to encourage NPR to renounce me and my opinions in The State Journal, then I just might have the credentials to apply for a job at FOX News. And then, like Juan Williams, I could have a big pay day.
There's more than payola to my wanting to be a FOX News contributor, however.
As you may know, syndicated columnist Charles Krauthammer is a FOX News contributor. Dr. Krauthammer is a quadriplegic. I am also a quadriplegic. You can take it from me that you never want to believe the opinion of just one wheelchair-bound pontificator. (Professor Steven Hawking excepted.)
To be fair and balanced, you should seek the opinions of two wheelchair-bound pontificators. Roger Ailes, I could be that second, wheelchair-bound pontificator at FOX News. I could even be unfair and unbalanced if that's what you need me to be. Put me in coach, I'm ready to roll.
Sen. Rockefeller, I am more like you than you think. I also believe the First Amendment is an anachronism that should be ignored whenever opinions are unflattering. Like you, I also agree that the old-timey, non-combative news format needs brought back. We need to go back to the days when politicians in Washington used the FCC to hold complete control over the airwaves and the broadcasters.
Of course, times were better back then. We didn't know any different.
Some 20 years ago, I was foggy-brained enough to believe in the mission of public radio. I was even a monetary contributor to West Virginia Public Radio. I enjoyed listening to the Saturday opera and "Prairie Home Companion." I also fell swoon to the mellowing liberalism of "All Things Considered." I wanted to believe I could be tolerant of liberals, which, upon reflection, is what held me back for years from becoming an opinion writer for The State Journal.
Then one evening, while I was tuned to "All Things Considered," I had a revelation. An ATC reporter was broadcasting from the apartment of a San Francisco man who collected Sonia Henie memorabilia. If you don't recall her, Ms. Henie was an Olympic figure skating champion from Norway who appeared in more than a dozen films.
The collector had quite a lot of Ms. Henie's memorabilia, and you could tell that he had decorated his apartment almost completely with her mementos. But he had gone too far (in my opinion). He had Sonia Henie's underwear framed under glass and hanging on the wall.
It did not surprise me that a San Francisco man cherished Sonia Henie's underwear to the point that he had it framed. After all, there are a lot of San Franciscans of Norwegian descent. Garrison Keillor once considered airing a Norwegian-themed show from San Francisco and calling it "Bay Companion" ("Fjord Companion" in Scandinavian distribution).
But the Henie underwear show was too much for me. I figured that if public radio had the money to air a story about a movie star's framed underwear, then it didn't need my help anymore.
Don't get me wrong. I have nothing against collecting women's underwear. I used to collect women's underwear myself, but I had the good sense to keep it where it belonged -- in the glove box of my pickup truck.
I tell this story of my public radio resentment so that I will be renounced as a State Journal contributor. I want my Juan Williams moment. I want a shot at the big money at FOX News.
I must say that I owe my decision to come clean about public radio to none other than Sen. Jay Rockefeller. Had he not had the fortitude to recently denounce FOX News and MSNBC at a Senate committee hearing, then I would not be telling you about my falling out with public radio.
I also owe a measure of thanks to former NPR contributor Juan Williams because he had the inner strength to tell people that he felt uncomfortable seeing people in Muslim dress waiting to board his flight. I just hope that my story rises to that level of reprisal from National Public Radio.
I am told that Sen. Rockefeller knows people who know people who run the public broadcasting empire. If Sen. Rockefeller could use his connections to encourage NPR to renounce me and my opinions in The State Journal, then I just might have the credentials to apply for a job at FOX News. And then, like Juan Williams, I could have a big pay day.
There's more than payola to my wanting to be a FOX News contributor, however.
As you may know, syndicated columnist Charles Krauthammer is a FOX News contributor. Dr. Krauthammer is a quadriplegic. I am also a quadriplegic. You can take it from me that you never want to believe the opinion of just one wheelchair-bound pontificator. (Professor Steven Hawking excepted.)
To be fair and balanced, you should seek the opinions of two wheelchair-bound pontificators. Roger Ailes, I could be that second, wheelchair-bound pontificator at FOX News. I could even be unfair and unbalanced if that's what you need me to be. Put me in coach, I'm ready to roll.
Sen. Rockefeller, I am more like you than you think. I also believe the First Amendment is an anachronism that should be ignored whenever opinions are unflattering. Like you, I also agree that the old-timey, non-combative news format needs brought back. We need to go back to the days when politicians in Washington used the FCC to hold complete control over the airwaves and the broadcasters.
Of course, times were better back then. We didn't know any different.
Friday, November 12, 2010
Our Egg Dilemma Tells America's Economic Story
I am an economist. The faculty of an American college tested me and gave me a certificate saying so. At no time during the testing period did I see a man behind the curtain.
The one (and only) thing that I learned from my studies is that economics is all about expectations. I realized this early on in Principles of Economics when I learned about the marginal utility of goods and services. The textbook taught us about the marginal utility of buggy whips—a teamster places a high value on one buggy whip, less value on a second, spare buggy whip, and even less value on a third buggy whip.
This makes perfect sense. If you have to reach for the third buggy whip, then the horse is either foaming at the nostrils or already dead.
What explanation were you expecting?
Adam Smith introduced the theory of capitalism and its invisible hand to shape the marketplace. Smith was spot on for his day. But in retrospect, people believed in and practiced laissez-faire economics every day. For example: the nation had progressed far enough from farm life to town life so that the butter and egg man drove through the neighborhoods weekly. No longer did every household need its own milk cow and chickens to enjoy buttered toast and scrambled eggs for breakfast.
As there was no regulation of food commerce to speak of, Adam Smith’s economic theory was more of an observation of common practices put into words. His theory continued to be relevant through the Nineteenth Century because housewives knew what butter and eggs were supposed to look and taste like. This was Adam Smith’s free commerce at its greatest—the knowledgeable consumer dealt directly with the competent supplier/seller.
When the Twentieth Century arrived, a new economic model came into practice. Grocery stores began buying butter and eggs and then, re-selling them. The store owner now decided the quality of butter and eggs as the consumer was removed from that part of the transaction. And, with his well-practiced thumb on the scale, the grocer could churn ten pounds of butter into twelve.
This brought on the beginning of top-down regulation of the marketplace. With it came the need of a new economic theory. John Maynard Keynes put his observations of common practices into words which eventually became his “General Theory” in1936. Keynes moved the debate from Adam Smith’s microeconomic practices to the then-maturing macroeconomic practices.
In the days when Adam Smith prevailed, a housewife dealt face-to-face with the egg producer on a weekly basis. Further, the housewife had either raised chickens herself or knew enough about eggs to know if the egg producer was selling fresh eggs.
Now we are at the end of Keynesian theory; huge companies inspected by huge government agencies produce most of America’s eggs which are, in turn, sold by huge grocery chains. This year, one of those producers recalled nearly 400 million tainted eggs with hardly an apology to the public. This egg recall represents top-down macroeconomic theory nearing its zenith.
American consumers are so ignorant about eggs that the Food and Drug Administration included the following paragraph in its egg recall notice: “What does the product look like?” That paragraph only tells the consumer the various brand names printed on the recalled egg cartons.
Regarding egg sales, Adam Smith’s theory no longer works because the consumer is unqualified to bargain with the seller. The egg seller is too small to supply a large customer like McDonalds.
In Keynes’ scenario, eggs are mass-produced to the point that eggs are no longer eggs, at least not in the taste sense. The next step will be irradiation to solve the annoyance of expensive recalls.
At some point during the past 200 years, we had the system down pat. Residential and commercial consumers expected fresh, germ-free eggs, and the marketplace delivered them. But we couldn’t stop there, could we? No, we allowed thousands of family-owned poultry farms to be priced out of business by a handful of mega-producers. We foolishly thought that government food inspectors would guarantee the previous high level of quality. But that never happened.
When Americans expect (read demand) fresh eggs again, then the marketplace will deliver them. A dozen eggs will cost more, but the improved taste and nutritional value will offset that price increase.
If Americans can re-learn how to do eggs, then they will have determined the right blend of Adam Smith and John Maynard Keynes. If we cannot do eggs, then forget about solving the big problems.
Economics is all about expectations. How do you want your eggs?
The one (and only) thing that I learned from my studies is that economics is all about expectations. I realized this early on in Principles of Economics when I learned about the marginal utility of goods and services. The textbook taught us about the marginal utility of buggy whips—a teamster places a high value on one buggy whip, less value on a second, spare buggy whip, and even less value on a third buggy whip.
This makes perfect sense. If you have to reach for the third buggy whip, then the horse is either foaming at the nostrils or already dead.
What explanation were you expecting?
Adam Smith introduced the theory of capitalism and its invisible hand to shape the marketplace. Smith was spot on for his day. But in retrospect, people believed in and practiced laissez-faire economics every day. For example: the nation had progressed far enough from farm life to town life so that the butter and egg man drove through the neighborhoods weekly. No longer did every household need its own milk cow and chickens to enjoy buttered toast and scrambled eggs for breakfast.
As there was no regulation of food commerce to speak of, Adam Smith’s economic theory was more of an observation of common practices put into words. His theory continued to be relevant through the Nineteenth Century because housewives knew what butter and eggs were supposed to look and taste like. This was Adam Smith’s free commerce at its greatest—the knowledgeable consumer dealt directly with the competent supplier/seller.
When the Twentieth Century arrived, a new economic model came into practice. Grocery stores began buying butter and eggs and then, re-selling them. The store owner now decided the quality of butter and eggs as the consumer was removed from that part of the transaction. And, with his well-practiced thumb on the scale, the grocer could churn ten pounds of butter into twelve.
This brought on the beginning of top-down regulation of the marketplace. With it came the need of a new economic theory. John Maynard Keynes put his observations of common practices into words which eventually became his “General Theory” in1936. Keynes moved the debate from Adam Smith’s microeconomic practices to the then-maturing macroeconomic practices.
In the days when Adam Smith prevailed, a housewife dealt face-to-face with the egg producer on a weekly basis. Further, the housewife had either raised chickens herself or knew enough about eggs to know if the egg producer was selling fresh eggs.
Now we are at the end of Keynesian theory; huge companies inspected by huge government agencies produce most of America’s eggs which are, in turn, sold by huge grocery chains. This year, one of those producers recalled nearly 400 million tainted eggs with hardly an apology to the public. This egg recall represents top-down macroeconomic theory nearing its zenith.
American consumers are so ignorant about eggs that the Food and Drug Administration included the following paragraph in its egg recall notice: “What does the product look like?” That paragraph only tells the consumer the various brand names printed on the recalled egg cartons.
Regarding egg sales, Adam Smith’s theory no longer works because the consumer is unqualified to bargain with the seller. The egg seller is too small to supply a large customer like McDonalds.
In Keynes’ scenario, eggs are mass-produced to the point that eggs are no longer eggs, at least not in the taste sense. The next step will be irradiation to solve the annoyance of expensive recalls.
At some point during the past 200 years, we had the system down pat. Residential and commercial consumers expected fresh, germ-free eggs, and the marketplace delivered them. But we couldn’t stop there, could we? No, we allowed thousands of family-owned poultry farms to be priced out of business by a handful of mega-producers. We foolishly thought that government food inspectors would guarantee the previous high level of quality. But that never happened.
When Americans expect (read demand) fresh eggs again, then the marketplace will deliver them. A dozen eggs will cost more, but the improved taste and nutritional value will offset that price increase.
If Americans can re-learn how to do eggs, then they will have determined the right blend of Adam Smith and John Maynard Keynes. If we cannot do eggs, then forget about solving the big problems.
Economics is all about expectations. How do you want your eggs?
Friday, October 8, 2010
Nation Faces Massive Debt ... And There Is No Way Out
When President Barack Obama took office, the national debt was around $10 trillion. The president then had the U.S. Treasury print a trillion dollars in new money to spur economic growth. And then another trillion dollars or so in deficit financing was arranged to pay for Mr. Obama's first budget. Now the federal debt is said to be about $13 trillion. Or is it?
These numbers greatly understate the national debt. Unfunded liabilities in Medicare and Social Security retirement add something like $30 trillion to the debt. A myriad of federal loan guarantees could cost trillions more should the economy continue to stagnate.
And there is more debt on top of that. The collective states, counties and cities are big borrowers and will face some level of default in the future. Public employee benefit funds in nearly all states are woefully underfunded. Tiny West Virginia alone is looking at $13 billion in unfunded post-employment benefits debt.
Consumers are in debt up to their eyeballs -- mortgages, car loans, student loans, credit card debt and home equity (or second mortgage) loans. Millions of Americans are unemployed or won't work and live on the dole. Millions of Americans have spent their meager savings. Millions of Americans are flat broke.
The American people, in debt as they are, see only a magnificent nation. They see beautiful cars traveling on beautiful superhighways. They see beautiful houses with beautiful appliances and flat screen TVs. They see beautiful college campuses and public schools. They see beautiful government buildings. They see beautiful sail boats, cabin cruisers, speed boats and Jet Skis. They see beautiful vacation homes at the sea shore, the ski slopes or anywhere else there is natural beauty.
They see an army, a navy, and an air force second to none in the history of mankind. They see outer space as a parking lot for space stations, GPS and communication satellites.
Ask any American, and he or she will tell you that Americans have built and paid for all of our beautiful notions with our tax money. For some reason, though, they cannot see the mountain of debt that has financed the modern American lifestyle.
As this charade continues to play out, I am reminded of Wimpy, the obese moocher in the Popeye comic strip who was forever saying, "I will gladly pay you Tuesday for a hamburger today."
Tuesday's math lesson: How do we pay back the $13 trillion we currently have borrowed? And then, how do we pay $40 trillion in future obligations? Just how does our nation generate budget surpluses of $1 trillion to $2 trillion per year, each year, for the next 20 years?
One school of thought -- borrow more, spend more -- follows Keynesian economists who believe that the president's stimulus plan didn't go far enough. The opposing view -- cut taxes, cut spending -- is held by the Tea Party.
As for borrowing more, just what is our national credit score?
As for raising taxes, repealing the "Bush tax cuts" will likely ignite a class war.
As for cutting spending, who gives up an entitlement? Do we cut the Social Security retirement benefit? The mortgage interest deduction? The earned income credit? The arts? Defense? National parks?
Remember now, we are asking a government that can't run a piddling passenger train at a profit to solve this multi-trillion-dollar problem.
The election of Barack Obama and his message of "Change" were all about the hubris of the left. The Tea Party revolt is all about the hubris of the right. Neither side will compromise its position on taxes and spending; their hubris prevents it.
The lefties are fed up with Washington. And so are the righties. But to solve the debt crisis, both sides need to admit: "Mea culpa!" After all, partisan politics is what got us here.
In 1975, New York City faced bankruptcy. Then-President Gerald R. Ford told the city that the federal government would not bail it out. The next day, there was a newspaper cartoon that showed a housewife, with her hair in curlers, wearing a housecoat and ironing clothes while her husband, unshaven, sat at the kitchen table in his underwear reading the morning paper. The newspaper headline blared, "FORD TELLS CITY -- DROP DEAD!" Caption: The husband tells his wife, "Well, at least we still have our pride."
We've borrowed so much with so little to show for it that it's almost comical.
These numbers greatly understate the national debt. Unfunded liabilities in Medicare and Social Security retirement add something like $30 trillion to the debt. A myriad of federal loan guarantees could cost trillions more should the economy continue to stagnate.
And there is more debt on top of that. The collective states, counties and cities are big borrowers and will face some level of default in the future. Public employee benefit funds in nearly all states are woefully underfunded. Tiny West Virginia alone is looking at $13 billion in unfunded post-employment benefits debt.
Consumers are in debt up to their eyeballs -- mortgages, car loans, student loans, credit card debt and home equity (or second mortgage) loans. Millions of Americans are unemployed or won't work and live on the dole. Millions of Americans have spent their meager savings. Millions of Americans are flat broke.
The American people, in debt as they are, see only a magnificent nation. They see beautiful cars traveling on beautiful superhighways. They see beautiful houses with beautiful appliances and flat screen TVs. They see beautiful college campuses and public schools. They see beautiful government buildings. They see beautiful sail boats, cabin cruisers, speed boats and Jet Skis. They see beautiful vacation homes at the sea shore, the ski slopes or anywhere else there is natural beauty.
They see an army, a navy, and an air force second to none in the history of mankind. They see outer space as a parking lot for space stations, GPS and communication satellites.
Ask any American, and he or she will tell you that Americans have built and paid for all of our beautiful notions with our tax money. For some reason, though, they cannot see the mountain of debt that has financed the modern American lifestyle.
As this charade continues to play out, I am reminded of Wimpy, the obese moocher in the Popeye comic strip who was forever saying, "I will gladly pay you Tuesday for a hamburger today."
Tuesday's math lesson: How do we pay back the $13 trillion we currently have borrowed? And then, how do we pay $40 trillion in future obligations? Just how does our nation generate budget surpluses of $1 trillion to $2 trillion per year, each year, for the next 20 years?
One school of thought -- borrow more, spend more -- follows Keynesian economists who believe that the president's stimulus plan didn't go far enough. The opposing view -- cut taxes, cut spending -- is held by the Tea Party.
As for borrowing more, just what is our national credit score?
As for raising taxes, repealing the "Bush tax cuts" will likely ignite a class war.
As for cutting spending, who gives up an entitlement? Do we cut the Social Security retirement benefit? The mortgage interest deduction? The earned income credit? The arts? Defense? National parks?
Remember now, we are asking a government that can't run a piddling passenger train at a profit to solve this multi-trillion-dollar problem.
The election of Barack Obama and his message of "Change" were all about the hubris of the left. The Tea Party revolt is all about the hubris of the right. Neither side will compromise its position on taxes and spending; their hubris prevents it.
The lefties are fed up with Washington. And so are the righties. But to solve the debt crisis, both sides need to admit: "Mea culpa!" After all, partisan politics is what got us here.
In 1975, New York City faced bankruptcy. Then-President Gerald R. Ford told the city that the federal government would not bail it out. The next day, there was a newspaper cartoon that showed a housewife, with her hair in curlers, wearing a housecoat and ironing clothes while her husband, unshaven, sat at the kitchen table in his underwear reading the morning paper. The newspaper headline blared, "FORD TELLS CITY -- DROP DEAD!" Caption: The husband tells his wife, "Well, at least we still have our pride."
We've borrowed so much with so little to show for it that it's almost comical.
Friday, October 1, 2010
Many Find They Have The Luxury To Grumble
Does it seem to you that people complain more and more these days? Does it also seem that people complain more and more about situations beyond anyone’s control?
I am sure you would answer both questions with a resounding “Yes.”
There are reasons for these phenomena. And surprisingly, some of this complaining is a good sign because different kinds of complaints mean different things.
Psychologist Abraham Maslow is well-known for his theory on the hierarchy of human needs. He also wrote an interesting journal containing workplace observations which he published in 1965 as “Eupsychian Management.” The book has since been re-titled “Maslow on Management.”
Maslow observed that there are three kinds of grumbles. Low grumbles have to do with the meeting of basic needs such as pay and working conditions. High grumbles kick in after workers have exceeded their basic needs and receive better pay and less rigorous working conditions. And then he introduces us to metagrumbles—those grumbles which are more philosophical in nature and may not have anything to do with one’s pay or working conditions.
You won’t find many low grumbles in the modern workplace. With minimum wage laws, government benefits such as food stamps, OSHA workplace safety requirements and unemployment insurance, even the lowest paid workers are relatively secure compared to fifty years ago.
Americans may think that the lowest-paid workers live at the doorstep of desolate poverty, but thousands of people purposely earn $10,000 to $15,000 per year, max out their government entitlements, and still own their own humble residence. More people than you would imagine shop for near-new clothes at thrift stores. More people than you would imagine download discount coupons. More people than you would imagine live well on the cheap.
High grumbles are a different matter. If you give an employee an office with one window, he’ll want two. If his company car is a sedan, he’ll want an SUV. Give him a black stapler and he’ll want the snazzy red one.
The classic high grumble that I hear most often comes from the professional whose year-end bonus makes up a large portion of his annual pay. The bonus is almost always less than was expected. And this grumble comes from people who make a comfortable six figures (eight counting the decimal.)
High grumbles are often related to perks. After one has bettered his lifestyle beyond basic needs, a portion of that extra income will go toward building status or partaking of leisure activities. Tell John Doe that he can no longer use company-paid frequent flyer miles for personal or vacation travel, and you will hear a high grumble.
Low grumbles are a product of the authoritarian workplace, a workplace of despair and fear. Low grumbles, according to Maslow, are a sign that workers are not meeting their basic needs.
High grumbles, on the other hand, can be a positive sign in the workplace. If interpreted properly, high grumbles point to ways in which to motivate workers. Yes, the high grumble worker may benefit personally from having his complaint satisfied, but there will almost always be a spillover that benefits the organization. An office with a second window might actually increase a worker’s sense of worth in the hierarchy and be more effective and less costly than the offer of a pay raise.
Metagrumbles are rhetorical, nebulous thoughts. The worker wants to see more “honesty,” or more “justice,” in the way the company treats its employees. These words, of course, never get defined. Who are the metagrumblers according to Maslow? “[P]eople who have the luxury of complaining at this level are strictly living a very high-level life.”
Darryl Hannah was the very model of a modern metagrumbler when she flew cross country to West Virginia and sat on her duff to protest coal mining. Glenn Beck has become a metagrumbler extraordinaire since he gave up drinking (prior to which he was presumably a low grumbler.)
A metagrumbler need not be a celebrity, though. The “high-level life” that Maslow refers to means that most high needs have been satisfied, and the person is free to contemplate such unanswerable questions as “Is global warming caused by man?”
Maslow concludes that it is impossible for people not to complain: “There is no Garden of Eden, there is no paradise…” But he also advises that grumbles lead to solutions, which in turn lead to the betterment of all mankind. And he envisions this process of grumbling as being eternal.
I am sure you would answer both questions with a resounding “Yes.”
There are reasons for these phenomena. And surprisingly, some of this complaining is a good sign because different kinds of complaints mean different things.
Psychologist Abraham Maslow is well-known for his theory on the hierarchy of human needs. He also wrote an interesting journal containing workplace observations which he published in 1965 as “Eupsychian Management.” The book has since been re-titled “Maslow on Management.”
Maslow observed that there are three kinds of grumbles. Low grumbles have to do with the meeting of basic needs such as pay and working conditions. High grumbles kick in after workers have exceeded their basic needs and receive better pay and less rigorous working conditions. And then he introduces us to metagrumbles—those grumbles which are more philosophical in nature and may not have anything to do with one’s pay or working conditions.
You won’t find many low grumbles in the modern workplace. With minimum wage laws, government benefits such as food stamps, OSHA workplace safety requirements and unemployment insurance, even the lowest paid workers are relatively secure compared to fifty years ago.
Americans may think that the lowest-paid workers live at the doorstep of desolate poverty, but thousands of people purposely earn $10,000 to $15,000 per year, max out their government entitlements, and still own their own humble residence. More people than you would imagine shop for near-new clothes at thrift stores. More people than you would imagine download discount coupons. More people than you would imagine live well on the cheap.
High grumbles are a different matter. If you give an employee an office with one window, he’ll want two. If his company car is a sedan, he’ll want an SUV. Give him a black stapler and he’ll want the snazzy red one.
The classic high grumble that I hear most often comes from the professional whose year-end bonus makes up a large portion of his annual pay. The bonus is almost always less than was expected. And this grumble comes from people who make a comfortable six figures (eight counting the decimal.)
High grumbles are often related to perks. After one has bettered his lifestyle beyond basic needs, a portion of that extra income will go toward building status or partaking of leisure activities. Tell John Doe that he can no longer use company-paid frequent flyer miles for personal or vacation travel, and you will hear a high grumble.
Low grumbles are a product of the authoritarian workplace, a workplace of despair and fear. Low grumbles, according to Maslow, are a sign that workers are not meeting their basic needs.
High grumbles, on the other hand, can be a positive sign in the workplace. If interpreted properly, high grumbles point to ways in which to motivate workers. Yes, the high grumble worker may benefit personally from having his complaint satisfied, but there will almost always be a spillover that benefits the organization. An office with a second window might actually increase a worker’s sense of worth in the hierarchy and be more effective and less costly than the offer of a pay raise.
Metagrumbles are rhetorical, nebulous thoughts. The worker wants to see more “honesty,” or more “justice,” in the way the company treats its employees. These words, of course, never get defined. Who are the metagrumblers according to Maslow? “[P]eople who have the luxury of complaining at this level are strictly living a very high-level life.”
Darryl Hannah was the very model of a modern metagrumbler when she flew cross country to West Virginia and sat on her duff to protest coal mining. Glenn Beck has become a metagrumbler extraordinaire since he gave up drinking (prior to which he was presumably a low grumbler.)
A metagrumbler need not be a celebrity, though. The “high-level life” that Maslow refers to means that most high needs have been satisfied, and the person is free to contemplate such unanswerable questions as “Is global warming caused by man?”
Maslow concludes that it is impossible for people not to complain: “There is no Garden of Eden, there is no paradise…” But he also advises that grumbles lead to solutions, which in turn lead to the betterment of all mankind. And he envisions this process of grumbling as being eternal.
Friday, August 13, 2010
Clarksburg, Bridgeport Merger? Maybe in 400 years.
Clarksburg is not moving. The franchise that is Clarksburg is moving, however.
For nearly a century, the law firm of Steptoe and Johnson (S&J) anchored the downtown as the prime tenant in the Union National Bank (now known as Chase) building. The firm’s 171 employees have moved to Bridgeport and are comfortably housed in a new building bearing the firm’s name. As big as S&J is, it remained nearly invisible for all of its years in Clarksburg because most people don’t think of ten-story bank buildings as being job centers.
In October, what’s left of the Clarksburg franchise will move to Bridgeport. United Hospital Center (UHC) has built a new hospital there. UHC began as the combination of Union Protestant Hospital and St. Mary’s Hospital. Like S&J, the hospital is ending a century-long presence in Clarksburg. With the hospital’s move, doctors and medically-related businesses will move to Bridgeport, too.
But this new Bridgeport is not really Bridgeport. Bridgeport was a sleepy little town; its franchise was the stockyard which closed a long time ago. Bridgeport’s other franchise was Michael Benedum, the famous oil wildcatter. Unfortunately for Bridgeport, Mr. Benedum banked his considerable fortune in Pittsburgh where it remains.
When I-79 breached the gap between old Clarksburg and old Bridgeport, a new city began to emerge. Zoning battles have given part of the new city to old Clarksburg and part to old Bridgeport. This new city—call it the I-79 strip—could have been the impetus to merge Clarksburg and Bridgeport into a single city of some importance. But that did not happen.
The intransigence of Clarksburgers and Bridgeporters reminds me of the rivalry between the kingdoms of Lilliput and Blefuscu that Gulliver encountered on the first leg of his voyage.
For as long as anyone in Lilliput could remember, the proper way to eat one’s egg was to first crack open the large end. Then one day, the emperor’s son cut his finger on his egg shell. The emperor then decreed that Lilliputians shall forever after crack open their eggs from the small end.
This decree was not universally accepted, and from time to time, a minority of Lilliputians would rebel. These rebels became known as the Big-endians, and to avoid persecution, many of them fled to the land of Blefuscu, Lilliput’s rival across the sea. The Blefuscudians tolerated the mores of the Big-endians because their high priests had declared “that all true believers break their eggs at the convenient end.”
You are probably thinking that I am using a story from “Gulliver’s Travels” in an article about merging cities to segue to that famous cliché, “You can’t make an omelet without breaking eggs.” Well, you’re wrong.
Here’s the point of the satire.
The Lilliputians, as well as their rivals, the Blefuscudians, were little people, literally and figuratively. Gulliver tells us that they were just six inches tall. The egg shell “schism” tells us how insignificant their differences were.
At one time, I believed that the cities in Harrison County could consolidate. In the early 1960s, the Catholics and the Protestants put aside their differences and pooled their resources to build the United Hospital Center. Thus, I thought, if the Catholics and Protestants could bury five centuries of differences, then surely Clarksburg and Bridgeport could be forward thinking.
I still think my prediction of a city merger is correct—perhaps just 400 years too early.
Old Clarksburg has lost almost half of its population since 1960, and twenty per cent of the current population of 16,700 is over age 65. Clarksburg needs to face this reality. And come October, Clarksburg also needs to face the reality that the last of the Big-endians has left town.
Old Bridgeport is a city of 7,300 and its population won’t grow dramatically over the next decade. There are new housing developments in the new city limits. But many more houses are being built in the rural areas to the north and east. Bridgeport will soon find itself as a lucrative tax collector with not enough citizens to (prudently) spend the tax money on.
If the two cities merged today—call it Clarksport or Bridgeburg—it would be a little city of 24,000 people. But the two mayors still should hold a ceremonial egg-breaking, serve quiche pies and bacon to their citizens, and then merge the towns and be done with it.
For nearly a century, the law firm of Steptoe and Johnson (S&J) anchored the downtown as the prime tenant in the Union National Bank (now known as Chase) building. The firm’s 171 employees have moved to Bridgeport and are comfortably housed in a new building bearing the firm’s name. As big as S&J is, it remained nearly invisible for all of its years in Clarksburg because most people don’t think of ten-story bank buildings as being job centers.
In October, what’s left of the Clarksburg franchise will move to Bridgeport. United Hospital Center (UHC) has built a new hospital there. UHC began as the combination of Union Protestant Hospital and St. Mary’s Hospital. Like S&J, the hospital is ending a century-long presence in Clarksburg. With the hospital’s move, doctors and medically-related businesses will move to Bridgeport, too.
But this new Bridgeport is not really Bridgeport. Bridgeport was a sleepy little town; its franchise was the stockyard which closed a long time ago. Bridgeport’s other franchise was Michael Benedum, the famous oil wildcatter. Unfortunately for Bridgeport, Mr. Benedum banked his considerable fortune in Pittsburgh where it remains.
When I-79 breached the gap between old Clarksburg and old Bridgeport, a new city began to emerge. Zoning battles have given part of the new city to old Clarksburg and part to old Bridgeport. This new city—call it the I-79 strip—could have been the impetus to merge Clarksburg and Bridgeport into a single city of some importance. But that did not happen.
The intransigence of Clarksburgers and Bridgeporters reminds me of the rivalry between the kingdoms of Lilliput and Blefuscu that Gulliver encountered on the first leg of his voyage.
For as long as anyone in Lilliput could remember, the proper way to eat one’s egg was to first crack open the large end. Then one day, the emperor’s son cut his finger on his egg shell. The emperor then decreed that Lilliputians shall forever after crack open their eggs from the small end.
This decree was not universally accepted, and from time to time, a minority of Lilliputians would rebel. These rebels became known as the Big-endians, and to avoid persecution, many of them fled to the land of Blefuscu, Lilliput’s rival across the sea. The Blefuscudians tolerated the mores of the Big-endians because their high priests had declared “that all true believers break their eggs at the convenient end.”
You are probably thinking that I am using a story from “Gulliver’s Travels” in an article about merging cities to segue to that famous cliché, “You can’t make an omelet without breaking eggs.” Well, you’re wrong.
Here’s the point of the satire.
The Lilliputians, as well as their rivals, the Blefuscudians, were little people, literally and figuratively. Gulliver tells us that they were just six inches tall. The egg shell “schism” tells us how insignificant their differences were.
At one time, I believed that the cities in Harrison County could consolidate. In the early 1960s, the Catholics and the Protestants put aside their differences and pooled their resources to build the United Hospital Center. Thus, I thought, if the Catholics and Protestants could bury five centuries of differences, then surely Clarksburg and Bridgeport could be forward thinking.
I still think my prediction of a city merger is correct—perhaps just 400 years too early.
Old Clarksburg has lost almost half of its population since 1960, and twenty per cent of the current population of 16,700 is over age 65. Clarksburg needs to face this reality. And come October, Clarksburg also needs to face the reality that the last of the Big-endians has left town.
Old Bridgeport is a city of 7,300 and its population won’t grow dramatically over the next decade. There are new housing developments in the new city limits. But many more houses are being built in the rural areas to the north and east. Bridgeport will soon find itself as a lucrative tax collector with not enough citizens to (prudently) spend the tax money on.
If the two cities merged today—call it Clarksport or Bridgeburg—it would be a little city of 24,000 people. But the two mayors still should hold a ceremonial egg-breaking, serve quiche pies and bacon to their citizens, and then merge the towns and be done with it.
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