Thursday, October 31, 2013

The lie behind the Reagan Revolution

I remember the Reagan Revolution. I remember the promises made for these tax cuts. They said that the tax cuts would raise revenue. They did not. They said that the tax cuts were fair. They were not. They said that the tax cuts would help the economy. They did not.

What did those tax cuts do? The only thing we can be certain of at this point is that the Reagan tax cuts have helped the wealthiest to accumulate money at a faster rate than the rest of us, at the expense of the rest of us. The Bush Tax Cuts only piled onto the damage done by Reagan. Fortunately, the Bush Tax Cuts have expired, but they need to be restored for the first $250,000 again.

Since the massive tax rate cuts to the top rates, the elite among us have been transformed from producers to rent-seekers. There is simply no economic basis to support the idea that a man who makes $20 million a year is more productive than a man who makes $8 million a year. Or $4 million a year. Or even $250,000 a year. Who gets to decide this stuff? Lawyers? They certainly help the cause of upward redistribution of income.

If you're a highly placed executive in any Fortune 500 company, your *friends* get to decide how much you will be paid while drinking martinis. But that's beside the point.

In almost every study I've ever read, the Reagan and Bush tax cuts have done nothing, NOTHING!, to help the economy. The one trend that is common across all studies is the observation that the top 1% have been accumulating wealth at a rate faster than at any other point in American history with one major exception: the period just prior to the Great Depression.

If the Reagan and Bush tax cuts had truly worked as advertised, we would not be spilling so much ink over the Great Recession, the still high rate of unemployment or the enormous concentration of wealth in the hands of about 400 families in the United States. Remember Reagan's "Trickle-Down Economics"? I don't think water was what he had in mind. Bush Sr. called it Voodoo Economics and he was right.

The long term effect of the Bush and Reagan tax cuts was to marginalize and nearly destroy the middle class. We see it in the Tea Party. We see it in the Occupy Movement. Both groups are pretty angry at the upper class, even if the former is just a useful tool for the Koch Bros.

Few people remember Eisenhower because many of the people who do are dead. Few remember that Eisenhower presided over a great economic boom even with 90% plus marginal tax rates on the highest incomes. He believed that every bomb and every missile was a theft from the poor and the hungry. He was a Republican. But today, he'd be called a socialist.

Wednesday, October 30, 2013

TranDunn Trading

My wife Alice and I got married in 2007. As we first learned to live together, I found that Alice had many practical ideas that I had never considered before. Where Alice is the great organizer, I'm Mr. Entropy. Where Alice has the gift of multiple languages, I am the master of one: English. And so it is that I offer an interesting tale, the tale of TranDunn Trading.

Within the first few months of living together, I found some very interesting surprises in Alice. For example, one day, I showed her my sushi rolling kit. I said, "Wait till I get home and we can make avocado roll together." When I got home, she had made enough to feed several people comfortably. At that point, I became reacquainted with wasabi.

When we were preparing to move to Utah, I was still working and asked Alice to pack all the small stuff and leave the big furniture to me and I will break it down. She had it all packed by the time I got home. When we moved from an apartment into our first home, I asked Alice to wait until I got home so that we could put it together, together. Again, she had all of our Ikea furniture put back together.

I began to notice small things she did that seemed novel. One day, she took a lemon, squeezed the juice into a small bowl and put the bowl in our microwave. After about a half minute of cooking, she took the bowl out, dipped a paper towel in the bowel and proceeded to clean the microwave with hot lemon juice.

Then I began to notice lime halves on the rim of the bathtub. The lime halves were squeezed and turned inside out. I asked her about them and learned that she was using limes as a natural deodorant. I then saw her one day using a lime halve to wash her face. I was so intrigued that I tried it myself. The oils in the lime were a natural moisturizer and my skin felt great after rinsing.

When our baby Emily was born, she was fine, but around the second month, we began to notice she was scratching a lot and that turned out to be eczema. We tried many things to help her. One item that seemed to help a great deal was lanolin. It worked so well, that Alice began to research lanolin products and came up with her own, TranLan. One very interesting note is that when we stopped using milk-based formula, the eczema went away - a note for baby number 2.

TranLan didn't just help Emily with her skin, it has helped me with my dry, cracked heels. The lanolin sticks to the skin and seals it up, locking in moisture. When it dries, there is no smell, no residue. TranLan helped to soften my heel so that when I scrub my heel with a pumice stone, most of the dead skin falls away, leaving me with a smoother heel with no cracks. Since I started using TranLan, I've been pain free on my heels, even when I wear sandals in the summer. I have even found that TranLan works on the hands, healing cracked cuticles and moisturizing the web between my thumb and index finger.

Alice has also created a lip balm called CocoTran. I've used it myself to find that my cracked lips heal up in a day or overnight with just one application. It has a nice kind of coconut smell and goes on smooth. Instead of putting it in a tube like most lip balms, she packs it in a nice metal tray with a sliding top. Then it's easy to get to the last spot of balm in the tray. The tray dispenser ensures that there is no waste and you get all of what you paid for.

Alice created these products with simple ingredients that are easy to pronounce. They are made with care, by hand. I have helped with the website, email and the labels, but she does the rest, in the kitchen, when Emily is sleeping. Alice sources her own materials and checks them out. She researches the containers and the methods of putting everything together into a nice, neat little product.

If you have dry, chapped lips, or dry cracked heels, give our products a try. You might find that they work well for you. If do you do decide to try them out, please give us feedback. We love feedback. :) You can reach Alice at and me by posting a comment to this blog.

Thursday, October 24, 2013

No skin in the game

Ted Cruz sought to defund Obamacare and lost. After months of arm-wrestling in Congress, a government shutdown and secret meetings in restaurant basements, we learn the shocking truth. Ted Cruz had no skin in the game. He's sitting comfortably on his wife's health plan while she works as a director at Goldman Sachs, a health plan estimated to be worth some $40,000 a year. That's more than the average household income in America and it's just for health insurance.

While Cruz expected Congress and their staffers (who make around $40k) to forgo government provided healthcare, he was happy to omit the glaring facts concerning his ride on his wife's health care plan. This seems fitting since Goldman Sachs is an investment bank and they help people invest in, among other things, insurance companies. But that's not the main point of this article.

Ted Cruz is a multimillionaire. He doesn't have to think that hard about money like most of us do. There is a difference in thinking between a man who goes to work for a paycheck to care for his family and a man who is sitting on a pile of money looking for new ways to earn money with his money.

A working man (or woman) sees other people during the day. He has contact with other people every day, whether he likes it or not. He is doing a job that, more often than not, is a job someone else doesn't like to do. He is thinking about survival more than his next vacation - if he has ever had one. He's happy to have health insurance if he can get it.

A wealthy man can be seen jetting around the world, developing and maintaining alliances - when he wants to. I define a wealthy man as one who, doing nothing more than managing his money, doesn't have to work again for the rest of his life. A multimillionaire or billionaire. After the first billion, what else is there to do? Find a way to get more juice out of this lemon we call the economy. It is an interesting contrast in perspective.

The working man is thinking week to week, month to month. He may have a nice little house, a few TVs, a couple of cars for him and his wife. He sends his kids to public school. He has some time to be with his kids, wife and friends. He is aware of debts he has incurred. He is aware of when the next set of bills need to be paid. He is gratified that he can save any money at all, much less think about a college fund for his kids.

The wealthy man is thinking in terms of decades. By the time you get to be a billionaire, the only thing your brain understands is more money. Because more of anything else doesn't really matter anymore. He doesn't worry about the bills being paid because he has hired people to pay the bills. When he wants something, someone else will often buy it for him. He doesn't see money, he sees statements of accounts. He sees numbers. He only sees numbers because buying another car, another house, a bigger house, or a yacht doesn't make him feel any better. Material possessions cannot be quantified since they often lose their value after you buy them.

No, once you're in the stratosphere, you can't see the ground anymore. You don't see the little people milling about, getting from home to job and back again for a paycheck once a week.

So you, the billionaire, hustle with your friends to write legislation to take more money away from the economy and put it into your trust fund, your foundation or your portfolio. Then you can look at the statements and reports coming from the entities you created. You can take pride that finally, once again, you are making more money. Because buying something else doesn't matter anymore - unless it can make you more money.

Wednesday, October 23, 2013

NSA: security through insecurity?

For the last few months now, I've been reading headlines and articles about how the National Security Agency has been working hard to compromise common security standards. They have been demanding private keys for SSL certificates. They have been participating in standards development communities in an attempt to insert backdoors in our encryption algorithms. They seem to have been working with electronics manufacturers to get backdoors in our phones, our routers, and our computers.

I don't worry about China now so much as I do about the NSA. The NSA seems to be insisting that national security rests on individual insecurity. This is a problem not just for us, but for American businesses, too. Service providers like Google, Apple, Yahoo and Microsoft are going to feel a lot of heat and scrutiny for any collaboration with the NSA. They're losing foreign customers as a result of a bullheaded effort to compromise everyone - all in the name of the war on terrorism.

There is even pushback from technology providers. The Snowden Effect is well under way, with more and more people buying or otherwise acquiring encryption software to make their communications more secure. Secure email, secure browsers and soon, secure hardware, all from vendors who will not cooperate with the NSA. Technology leaders like Bruce Schneier and the Electronic Frontier Foundation are recommending that we all just make the NSA's job harder. If everyone uses encryption, then we cannot be guilty simply for using encryption.

While employees and policy directors at the NSA may believe they are fighting the good fight by relegating all of us to compromised security tools, they seem to be forgetting a few things. First, if you compromise something really important like SSL, you don't just make it easier for you to see what I'm doing. You are also making it easier for criminal entities to do the same thing. Is the NSA willing to accept liability for damages due to compromised security? I doubt it, the war on terrorism reigns supreme and trumps all other concerns.

How to fight back? As a technical matter, what really works is open standards. Using encryption based on open standards and open source software like PGP creates more overhead for the NSA. You can, if you want to, become a bitter pill. Any major standard implemented with open source software will have enough eyes looking at it to ensure that there are no back doors.

Abuses of the surveillance authority within the NSA have been well publicized. Employees have been checking in on their ex-boyfriend/girlfriend/spouse. They have been looking up celebrities to see what they're up to. And they're collecting all of it under the guise of national security.

Some of you may remember Nixon. You might even remember how he had managed to publicize the tax returns of his political opponents. After that experiment in forced exposure, Congress created the Privacy Act, an act designed to make agency records transparent to citizens. I've spent many years studying it and know the value of accountability in government as a result of that work. Don't worry, though, the NSA considers itself exempt from the Privacy Act.

The NSA seems to think that because they are acting in the name of the war on terrorism, that there are no limits to their power and that any abuses can be summarily excused. It is a holy-er-than-thou attitude that is unsustainable. If they can stop just one bomb from going off, their action is justified, at least in their own minds.

But, if one person dies because the security measures used to protect the data held by the NSA have been compromised, where does that leave them? Remember Edward Snowden? He's demonstrated one way to get at the data held by the NSA. There must be others. A well-connected deep pocket, determined to get the dirt on his adversary will find a way to the data held by the NSA. No defense can be prepared for all attacks.

Just imagine what Nixon could have done with the NSA today. He could be exposing political opponents left and right. Or he could use the NSA to clear the way for his designated successor. This is the real power of the NSA that so few are willing to discuss in public discourse.

Let's not forget why we even have the NSA - and I don't think it's to fight terrorism. The common man didn't invent the NSA - he's too busy working for a paycheck to even have time to dream up a problem like the NSA. No, the NSA exists purely for the protection of the interests of the elite. The people who run Lesterland - a land where 0.05% of the population are calling the shots in every national and state election. That is one massive perversion of a democratic republic that we affectionately call The United States of America.

Tuesday, October 22, 2013

The debt apocalypse hasn't happened yet

I can remember that old saw from conservatives. Remember the prediction that public debt was going to crowd out private borrowing? That interest rates would shoot through the roof and it would be 1979 all over again?

In recent years, interest rates have been at all time lows. Interest rates are still near historical lows. Yet, the federal debt is well over twice as high as it was in 1979. Even with a debt equal to nearly 80% of GDP now, interest rates are still very low. So what happened?

Foreign money. China, Japan and other Asian countries have stepped in to buy that debt. They buy it to float the dollar higher so that a thorny and sticky trade imbalance remains. It's not like we want it, either. Entrenched interests would prefer to see jobs go overseas than to have them here. God knows how much more money they would have to pay in labor if manufacturing were brought home.

To me, this seems like the perfect combination of public policy I like to think of as "keep away" - a game to keep capital from accumulating in the middle class. A high dollar makes foreign manufacturing profitable. A high debt load on the federal government gives foreign countries a way to prop up the dollar and shift the balance of trade. To ensure that debt remains high, taxes are kept artificially low on the people who profit the most from this convenient arrangement.

Given the profits arising from the sale of government debt, both directly and indirectly, I find it hard to believe that Republicans are truly serious about reducing budget deficits and the public debt.

Let's try a thought experiment. Let's say it actually happens, that the budget deficits go away, and that the public debt is actually paid off, never to return. Other countries would have very little leverage on the dollar at that point. Buying treasury bonds for dollars to prop up the value of the dollar would no longer be there. Maybe they would find other levers, but buying public debt is easy and convenient.

The other way is to buy dollars and take them out of circulation, which would increase the value of the dollar in other ways, but the money would no longer be working for them. People make money from money when it circulates, not when it sits in a room.

Once the debt is paid off, an enormous lever for manipulating the value of the currency is removed. Where are the wealthy governments and people going to put their money safely? Maybe they will find other safe places for it, but that drives home the next point. If the public debt were so dangerous, so risky, why are people even buying treasury bonds? Why does China own $1.6 trillion of treasury bonds?

No, this whole debate over the debt is a ruse. The elite want no debt reduction. If they did, they could have had it long ago. Don't believe me? How did we get here again? Who has the power to set up the trade imbalance? The people running Lesterland, the 0.05% of the population who are paying 60% or more of the campaign costs nationwide. That's who.

Oh, by the way, if trade were even between the US and the world, that would bring home at least 7 million jobs. That's a desirable result, but then that means having to pay US workers US wages. That might even resuscitate the middle class, and that would put the middle class closer to the upper class. No, that won't happen anytime soon. If that happened, the upper class would have to actually work to stay ahead. So the debt is here to stay as long as the elite want to keep it around.

Friday, October 18, 2013

Happiness is a choice, not a number

I was recently introduced to a video on YouTube called "Sweet Dreams (Goodnight Song)". It's a sweet, endearing story of a mother bear and her cub as they settle down from a long day out in the woods. As the cub yawns, the mother encourages him to fall asleep for the night.

As the cub falls asleep, we are invited to join his dream, a recollection of the day just passed. We see him approaching a lake, with fish jumping out of the water. His mother pulls him back to safety and joins him in watching the fish. Then we see him attempting to climb a tree to reach a beehive, only to slide back down the trunk. But with Mom's help, he makes the climb. Finally, we see the cub stopping to notice a beautiful glowing twilight in the distance over the green hills and a happily lit home in the foreground. The bear realizes that Mom is not there and runs back to the trail to bump into Mom.

Perfect day, right? I love this video because it makes me think of the good days that I've had (and some of the bad) and I find myself grateful for them. But more importantly, that video reminds me that happiness is not a quantity. Happiness cannot be measured objectively. The reason for this is that everyone has their own ideas about what makes them happy.

You may or may not enjoy the same things I do. But if we do, we can be friends and enjoy the same activities together. If not, that's cool, we can still talk or maybe we will find something else later.

Those bears were not concerned with quantity or even quality. They were just happy to live. They were not comparing themselves to others. They were not concerned that someone else might get to what they wanted before they did. They lived a life of abundance and were not concerned with accumulating anything.

I've noticed for myself that I'm having some pretty good days lately. They come and they go, of course, but most days for me are like the movie, "Groundhog Day". I pretty much do the same thing every day with some variations on the weekends. Every day is pretty much the same, but that means I get to decide what I want to do with the day.

Having more of something that I already have doesn't make me any happier. Having more food, TVs, toys, or even space, doesn't mean that I get happier as a result of that increase. How much more of something that you already have enough of will you need to make yourself happy? That's the question that comes up for me when I watch the Sweet Dreams video. The bears were already happy with what they had. When I wake up and make a decision to be happy with what I have, my days go better, smoother, less drama.

I didn't really start to think that way until about 10 years ago. Somehow, once I saw that getting more wasn't going to make me any happier, I started to focus on what I had and doing something meaningful with that. Now the bears didn't teach me that, but they are a great reminder.

Thursday, October 17, 2013

Keep Away: the economics game for the elite

It's over. It's finally over. The government is going to open once more. Pundits everywhere will tell us that they did it to save us. Maybe. They know that the default would have been bad if had been allowed to happen. But this is only a reprieve as the GOP would only give us a few months so that they could get another shot at Obamacare before the midterms next year.

No, this isn't about saving us. This is about saving them. Who are they? The elite who pretend to be so much better than the rest of us. The billionaires who say that they have the sole right to manage the world without so much as a peep from the rest of us. No, this isn't about saving us, not by a long shot.

You may well remember the subprime mortgage crisis of 2008. That crisis wiped out about $900 billion in annual economic demand every year since then. The people did not get bailed out like the banks did. The banks got their money and more while the people were left holding the bag. But that crisis is a symptom of a much deeper problem.

Let's start with the minimum wage. The minimum wage has not kept up with inflation. It is actually worth less in real dollars, dollars adjusted for inflation, than it was worth in 1969. It is rarely adjusted, and when it is, only begrudgingly. Our current federal minimum wage is $7.25 an hour. There is serious discussion about raising it to $10 an hour. Analysis of the current minimum wage indicates that if the minimum wage had kept pace with inflation, it would be about $22 an hour.

Minimum wage is a driver of economic demand. When people have more money, they spend more. Businesses would like to tell you that they are job creators. Well, maybe, but they need customers and if customers don't have money, businesses don't have customers, and they can't create jobs. It's like that. Consumers are the real job creators.

All the philosophical pandering and hand waving over Obamacare is not even about protecting the American people from the harms created by Obamacare. It's proving to be very popular, even in Red States. There was talk about forced charity. What charity? The very idea that a man should pay a tax if he refuses to buy health insurance. That's the charity that is bandied about in the social networks. But if a man doesn't have insurance, winds up in the emergency room and doesn't have the money to pay, who pays? The government. Charity is in the eye of the beholder now, isn't it?

Even then, the debate over Obamacare didn't hold a candle to defaulting on the national debt. Now there is an interesting topic for conservatives. The government sells debt to raise money when taxes generate less revenue than the government spends. Why do we have a national debt? For many years, the government has been spending much more money than it takes in.

This has served very well for the Conservative Nanny State. First, it provides a great safe haven for people with money. Lots of money. Tell me, do you know anyone personally who has a Treasury bond? Anyone? Who can afford to put some of their money away for a year, 5, 10 or even 30 years? Very wealthy people can. This is a great deal for the very wealthy and for that reason, I doubt if any Republican truly wants to eliminate the debt.

The national debt serves another purpose: maintaining the dollar as a reserve currency. When other countries buy dollars to hold in reserve, they could exchange their currency for dollars, but what they really like to do is buy bonds. Billions in bonds have been sold. China holds $1.6 trillion in bonds, so they own a big chunk of the US debt.

Who knows why China buys bonds? I do, I do! I learned it from an economist, his name is Dean Baker. Baker makes an interesting point. The reason China buys US debt is to hold the currency in reserve, but more to the point, to prop up the value of the ollar in relation to the yuan. This is an immense lever on the relative value of our currency, and has driven manufacturers to China for decades. China isn't the only one. Since the Asian financial crisis of the 1990s, all Asian countries hold significant reserves of US dollars. At first it was to meet the austerity measures imposed by the IMF. But they soon found that holding US dollars reverses the balance of trade in their favor.

With the balance of trade in reverse, Daffy Duck style, Americans have to work much harder to make money. Well, not all Americans. Some Americans are more American than others, so these special people have the privilege of sending our jobs overseas to make products that they sell here. With labor costs under control, it's just a matter of advertising and sales, then the checks just keep coming in.

The gains from productivity at home and from abroad have all gone to the top 1% and above. More than 90% of those gains went to the top 1%. For the rest of us, we get to scrap amongst ourselves to find a way to earn more money. But if the balance of trade were equal, we wouldn't need stock and housing bubbles to juice the economy. If the gains were more fairly distributed, we still wouldn't need bubbles to juice the economy. But for the last 30 years, the gains from productivity and international trade have all been distributed upwards, to the top 1% and beyond.

So if someone tells you that Congress averted default to save us, you can point them to articles to like this one that show the problems posed by a strong dollar and the imbalance of trade that goes with it. The trade imbalance is not an accident. Avoiding default simply allows the imbalance to go on indefinitely. That is what our tax dollars are paying for right now.

Monday, October 14, 2013

The libertarian illusion that is the Tea Party

The face of the Tea Party is often associated with libertarianism. Smaller government, markets and industries free of regulations and maverick political positions and statements. Sarah Palin is perhaps the most famous of the Tea Party politicians. Famous for her tough talk and catchy remarks, Palin captured the imagination of a significant segment of the electorate unhappy with the stereotypical conservative politician.

Senators Ted Cruz and Mike Lee are currently leading an effort to defund or repeal Obamacare. The premise they offer for their struggle is to protect the American people from the dangers of the kind of health care reform offered by the current administration. They have expressed and acted on a willingness to shutdown the government in order to delay, hinder, or eradicate Obamacare. Both men have offered principled explanations for their opposition to Obamacare.

Yet, when we look at the supporters of Cruz, Lee and Tea Partiers in general, we find quite a different mindset than that offered for consumption by American voters. I have found two studies (here and here, I'm sure there are more) that show rather consistently, that Tea Partiers are overwhelmingly older and white, fairly evenly split between men and women, express racist tendencies, a strong desire to put God back into government and schools, are against the teaching of evolution in schools, and the vast majority of their members are self-described Republicans.

I myself used to be libertarian. I still hold some libertarian views, particularly with regard to intellectual property laws concerning patents and copyrights - note that I don't subscribe to the views of Ayn Rand on the subject of intellectual property rights. My point is, I know a libertarian when I see one. Libertarians do not support the kind of government intervention into private life that Tea Partiers support.

Critical analysis of the Tea Party also shows that their members want the government to impose their own religious beliefs upon others, outlaw the teaching of evolution, punish homosexuals, and forbid abortions. These are not libertarian views, not even by a long-shot. They are authoritarian.

Further evidence of authoritarianism in the Tea Party includes dogmatism, the blind belief of anything their leaders say (just watch FOX News to get an idea), and double standards. There is more but the biggest point I want to make is that fanaticism is rampant within the Tea Party. Sitting members of Congress who describe themselves as Tea Partiers are enthusiastic in their efforts to damage Obamacare, and President Obama, in particular. They were often seen making threats to the Obama presidency, stating that they wanted to see him as a one-term president prior to the last presidential election.

This fanaticism has helped to contribute to the current shutdown we see today. But what adds fuel to the fire is electoral confidence from new district lines drawn after the last census. The new districts were drawn by Republican majorities in many state legislatures, giving these men and women a safe platform from which to lob their attacks against a sitting Democrat president.

The redistricting of our nation has created an interesting condition. Consider that president Obama won the popular vote in many states where Republicans won seats in the house. Now we have House districts drawn so that at least 84% of the seats are considered safe from attack, while the seats in the Senate are not safe due to the threat of the popular vote. In fact, there are more than a handful of Republican senators now who have expressed a willingness to deal, to vote on a clean continuing resolution and a debt ceiling limit without any conditions on Obamacare. They know that redistricting isn't going to help them, keeping them honest about their prospects for re-election after a prolonged shutdown.

I also see that the some members of the Tea Party have been comparing Obama to Hitler. Hitler was not just a fascist. He was an authoritarian. The German culture prior to World War II was a very authoritarian culture and the world has learned much from that period of history. But apparently, the Tea Party has not. I say that in the vein that authoritarianism is not a path to freedom, despite their efforts to paint it as such.

The current political climate precipitated by the Tea Party may well have been predicted by Barry Goldwater, former senator from Arizona. Goldwater is famous for the following quote:

"Mark my word, if and when these preachers get control of the [Republican] party, and they're sure trying to do so, it's going to be a terrible damn problem. Frankly, these people frighten me. Politics and governing demand compromise. But these Christians believe they are acting in the name of God, so they can't and won't compromise. I know, I've tried to deal with them."

Goldwater's observations ring true to the unwillingness of a small minority of House members to negotiate on Obamacare. So confident are they are of their convictions, they are willing to allow the shutdown of the government for one political objective: the elimination of Obamacare.

These Tea Party Republicans remind me of Iran and Iraq, two nations completely dominated by religion in politics. A government dominated by religious leaders will not be fun for anyone, even if they happen to be "good Christians". If the Tea Party rises to power, they will be seeking to impose their sense of order upon the rest of us. To what end, we can't be sure, but we have seen the suffering citizens, particularly of women, in nation states that are dominated by religious leaders in politics.

Worse still, if one religion rises to the top and secures it's position, it won't last for long as other religions will surely line up for their piece of the action. Instead of talking about how to keep the government functioning for everyone, we will be talking about how to extract maximum benefit from the government for one religious sect at the expense of the others.

Were the Tea Party to impose their will upon the rest of us, their vision of God would be everywhere in government, in schools and in business. The Tea Party, given a real shot at power, is willing to bring their fanatical attitudes and beliefs to government, and ultimately, to impose them upon the rest of us - despite the 1st Amendment. That is a truly frightening prospect.

Saturday, October 12, 2013

I want my MTV

I remember the early days of cable. We got cable in the house because the signal wasn't very good. Cable really cleared up the signal and we got more channels. The days of setting up an antenna to watch TV over the air are mostly gone. In order to retransmit signals, cable companies pay a fee to local broadcasters for the right of retransmission. This relationship has worked well for many years, but there appears to have been a sea change.

Television networks had a nice monopoly in the 70s and even eighties. Little to no competition. Complete control over the content.Then the VCR came along and introduced time shifting for people who wanted to watch a show later. Then the cable companies came along and introduced a lot more competition in the form of cable only networks. Then the internet came and changed everything. But times are tough and most people don't want to pay for internet and television.

Along comes Aereo, a service that competes for viewers with cable and satellite companies. Aereo allows subscribers to watch local TV over their computers, tablets or phones - live. Or they can record their shows of choice and watch them later. With a well equipped television and computer, one could easily watch American Idol on their big screen without the cable companies, at at time of the consumer's own choosing.

This is upsetting to the major networks. So upset are they, that they have sued and are appealing to the Supreme Court after having been defeated in the lower courts. Some are saying that if they lose, they will remove their content from the airwaves. They are afraid that if Aereo wins, they will not be able to recoup their losses. What losses?

The retransmission fees are so substantial, that CBS and Time-Warner engaged in a lengthy battle over fees, cutting viewers off from 60 Minutes and shows from the CSI franchise to name a few, for several weeks. This is much more than chump change. This money that two very large companies were willing to fight over, perhaps even go to court over it.

What will the major networks do with their broadcasting licenses if they take their content off the air? What happens to all that spectrum? We could use it for some other service that we have yet to consider. Maybe it could be turned into high speed wireless internet access for everyone - free. Who knows?

I like the idea of Aereo. They have figured out one very interesting problem. They too, have noticed that reception of television signals is terrible in most areas in many major markets. My personal experience with indoor antennas is that I can receive Telemundo and three other Spanish speaking stations with a perfect picture in high definition, but there is nothing, absolutely nothing, from any of the big four networks, ABC, CBS, FOX and NBC. Oh, I do get a great signal on an English speaking shopping station, too. Nice, touch.

Aereo gets around the copyright issue by building farms of thousands of tiny antennas, each one assigned to a unique subscriber. In addition to that, each subscriber has their own DVR and can record the shows of their liking. Isn't that interesting? The courts think so. The courts have recognized that each subscriber is directing the viewing and recording of the shows they want to watch and they are not engaged in viewing a public performance. Plus viewers can watch what they want on their big screen, their computer, their tablet or their phone. Not too bad for $8 a month. I guess that's better than bad: $20 a month or more for basic cable for one big screen.

If the major networks are really that upset about Aereo, then perhaps they could crank up the watts on their antennas so that viewers can get a good signal and watch their shows. Oh, wait. That won't work. The cable companies would be really upset about that, too. They would lose subscribers. And the networks would lose a giant chunk of change if people didn't subscribe to at least basic cable. Now there's a perverse economic incentive for a license to broadcast a signal over the air, a signal intended to be free and supported by advertising.

Aereo saw a need and filled that need in a way that cable companies and the major television networks were unwilling to fill. That's how a free market works. Notice that that little private monopoly didn't do them a bit of good in a free market. This is how it should be, but the networks disagree with the consumer and the courts so far. They want the government to restore their monopoly on the airwaves like it used to have. Such is the cry of the old, obsolete business model. Wave goodbye with me to the old television business model when the Supreme Court does not grant certiorari to the broadcast networks.

Thursday, October 10, 2013

A vision of the future

Throughout my life, I have seen interesting visions of the future. Donald Fagan's song, "What a Beautiful World It Will Be" suggests traveling from New York to Paris in 90 minutes in suborbital flight. Arthur C. Clarke's "2001: A Space Odyssey" imagines a life with routine space travel to orbit and to the moon and back. The Tom Cruise film, "Minority Report" envisions a world with amazing user interfaces for computers that will soon be a reality.

Today, I want to offer a vision of the future. I believe that there are three key technologies on the horizon, in the lab or in our history that can reshape the world into a cleaner, brighter future.

Perhaps the most interesting development is graphene. A miracle material by any measure, graphene has 200 times the tensile strength of steel, is the best conductor known to man and possesses a plethora of capabilities that we are just beginning to characterize. Graphene is a mono-atomic layer of carbon, with the bonds of each atom creating a sort of chicken-wire pattern. Graphene was discovered to be a component of graphite, what we commonly know as pencil lead, and has escaped our detection for thousands of years until recently. Now that we know about it, there is a worldwide scramble to bring the capabilities of graphene to businesses and consumers.

Graphene has shown promise in a variety of fields including but not limited to energy storage, data transmission and processing as well as super strong materials. There is no apparent limit to the range of applications that graphene can serve.

The Hyperloop is a new transportation technology invented by Elon Musk, but it is derived from the idea of a vacuum tube. You might remember the vacuum tubes used to send documents to and from the drive-thru tellers at banks in years past. Yeah, that vacuum tube. They still have them here in Utah.

The Hyperloop is a vacuum tube with "cartridges" that carry people. The concept is simple. Send pods of people, six to eight at a time, at high speed through a vacuum. Getting the pod up to speed will take much less energy because the pods travel through vacuum rather than having to push through the air like cars do. Promoters say that one Hyperloop tube can replace a 32 lane freeway or provide 700 mph travel around the world.

It is a goal worth achieving because, like the moonshot, the technologies that spin off the effort to create the Hyperloop will spread benefits all around the economy. Building the Hyperloop network will help us to gradually replace our roads with something that requires less maintenance, is far more efficient and will generate jobs like no other transportation technology.

I can't say enough about thorium. It's not a new technology in the strict sense of the word. That's because in the 1960s, the Oak Ridge National Laboratory ran a thorium molten salt reactor for more than 22,000 hours (more than two years) with no accidents, no spills and very little waste to clean up.

Thorium has 300 times the energy density of uranium, a million times the energy density of oil and coal (one ton of thorium will replace 31 billion barrels of oil - we burn about 20 million barrels a day in the US) and will last us thousands of years as a source of power. We're just not going to run out of thorium any time soon - thorium is 4 times more abundant than uranium and fairly equally distributed around the world. In addition, the problem of nuclear waste with thorium is about 1% of the volume of uranium fuel cycles and the waste products will yield valuable materials that are not produced in uranium fuel cycles. The radioactive elements left over will remain radioactive for 300 years or less compared to 10,000 years for uranium waste.

Thorium molten salt reactors don't require the high pressures and layers of security found in uranium reactors. There is no runaway reaction, no meltdown, very little proliferation risk, and the reactor shuts down passively in the event of a problem. It's about as safe as you can get for a nuclear reactor.

Thorium can replace all of our uranium power plants and more with enough power to replace all of the electricity demand met by coal and oil at a fraction of the cost of uranium. The power generated from thorium can also be used to desalinate water, split hydrogen from water, scrub carbon from the atmosphere and power electric cars while producing a tiny fraction of the waste from uranium. Oh, and by the way, much of the waste from uranium plants can be burned into safer elements in thorium molten salt reactors.

But none of this new infrastructure is going to happen (graphene is going to be just fine, but a lot of that research is government research). Why? We're dependent on private banks with selfish private interests. The interest payments charged by private banks and private investors are far too high to permit any of these dreams from being realized, let alone rebuild our crumbling infrastructure. No, we need a new, sometimes old way of thinking about banking.

Japan, Germany, China, Switzerland, Chile and the state of North Dakota all use public banks to help finance their governments. The government puts money received as taxes and fees into a public bank rather than a private bank and the public bank issues loans against that money just like a private bank, but with lower interest rates and greater transparency. The interest returned as profits goes back into the general fund for use in state projects. Public banks can compete against private banks and help to keep private banks honest. Public banks are transparent so people can see that public banks are not gambling with their investments.

The Bank of North Dakota returned a profit of $300 million in one year to the state general fund in a recession. This from a state with a diminutive population of 600,000. Imagine what can be achieved in a state with 30 million people and a $100 billion budget, such as California. Public banks scale up very nicely - just ask China. Instead of realizing budget deficits every year and having to borrow private money, states (counties and even cities) can each have their own public bank to acquire loans against their own reserves.

Public banking can rebuild our crumbling infrastructure, and build the infrastructure of the future for communication, transportation, schools and energy to name a few. Public banking will lower our taxes, provide relief from private banking speculation and market manipulation, and reduce unemployment. But only one state in our Union has a public bank because private banks have enough political power to keep the concept hidden from mainstream media.

That can change and it's up to us to make that change. Already, 20 states are considering the creation of a public bank within their jurisdictions. Maybe your state is one of them - Utah is not one of them. Why? Their highest paid public employee is a football coach. Utah is not alone. Many states have placed commercial interests above the interest of the people and that is what has to change.

Tuesday, October 08, 2013

A bank that works for the people

I have some interesting affiliations on Facebook. One of them is "US Uncut", an interesting source of news. I like them because they are liberal and their ideas make sense. Today, they posted a very interesting story about public banking. They shared the story of the state of North Dakota, the state with the lowest employment rate in the nation and one of the few states turning surpluses. They can thank the Bank of North Dakota for much of this success.

Turns out that when the state government deposits its revenue in the Bank of North Dakota (BND), that bank turns around and makes loans that are good for the people of the state. The BND is the only state owned public bank in the nation at the moment and many other states are looking into setting up their own bank.

The Public Banking Institute can explain it much better than I can, but from what I can see, there is no reason why we can't do what China, Japan and Germany have done for decades. Public banking can allow us to free ourselves from the tyranny of Wall Street, as other nations have found. We could do it on the state level.

it must be a great idea because even Jerry Brown, governor of California, did a pocket veto to keep a public banking bill from becoming law. That will wasn't even to create a bank, it was to do a study to see if a public bank at the state level was feasible. Banks know competition when they see it and move quick to quash it.

This brings me to an interesting question. Where does my state keep the money that it collects in revenue? What bank does it write checks from? I tried to find out with Google and could not find it. That would make it almost a secret. I will write a few innocent emails to find out and follow up later.

More to the point, though, is why should private banks be allowed to make money off of state money deposited with them, then loan the same money back to the state at high rates of interest? Why should states and counties need to raise bonds for infrastructure money? The story of BND proves that big projects can be financed without Wall Street and also proves that private banks have no business holding state money in deposit when they act like they own the country.

It's worth noting that the appeal of the BND is broad across party lines. It's not a Democrat or Republican solution. It's a solution for all residents of North Dakota.

According to the state activity list on the Public Banking Institute website, there is no activity here in Utah to investigate setting up a public bank. Utah isn't even listed. Utah culture is just dripping with "self-sufficiency", yet the financial mechanism to make the state more self-sufficient, more independent of private sources of funding, is not even on the radar.

There must be powerful banking interests at work to keep a public bank in Utah from happening.

Monday, October 07, 2013

Impressions of vanity

In recent days, my wife and I tried once again to see if we could catch a live HD TV signal from an HD antenna we got from Best Buy. Once again, I tried the antenna only to be reminded that the only channels we could receive were one English shopping channel and three Spanish channels. It was an inconvenient reminder that the big four networks, ABC, CBS, NBC and FOX, don't make enough money from advertising anymore. They make their money from selling retransmisison rights to the cable networks, so they have no incentive to broadcast HD TV at a power high enough to be received by most people in their service area.

As I scanned the four available channels, I got a taste of the of uber-bravado/feminism and macho-heroism portrayed in Mexican pop culture. Sure, we have it in our American pop culture, but the Mexican culture portrayed by their television shows seems so overwrought, almost like a caricature. That impression has left me thinking for a day or so.

I look around and, seeing a continuum of satisfaction in the human condition, am left to wonder, how much is enough?

I live in a humble little pink house. It has a lawn in front and a lawn in back with little white fences on either side. I have an attached garage with a garage door opener. I have some 1300 square feet to work with, some of which I do not venture into too often. I take a certain pleasure in seeing the sunlight stream into the house during the equinox at sunrise and sunset. I am, in a way, satisfied with the space available to me. It is enough.

My car, small, nimble, light, and easy on the gas, gets the job done. I have a short, 18-minute commute and I stream music through my phone when I go to work. I do some shopping. I might run an extra errand or visit friends and family. But I usually get by on about $15 to $35 a week on gas. It's enough.

I have a decent LCD TV, a computer, a cell phone with a spare, a refrigerator, a washer and dryer and a few other amenities. I don't need to buy another one of any of them. My 5 year old computer was ready for replacement, and that has recently been replaced, but once the excitement of building a new operating system is over, I'm back to the routine again. With every new thing we get, the excitement only lasts a little while and the routine returns. I have enough and buying more or better isn't really going to make me feel better.

I've seen wealth in houses and cars. I've seen Armand Hammer's mansion in Beverly Hills many years ago, a posh little palace with a Rolls Royce in a stuffed garage, gathering dust with a dented fender, long forgotten. I've seen millionaire homes with the best of everything. Stainless steel appliances, rooms dedicated to home theater, opulent bathrooms, and big garages filled with shiny, alluring, brutally fast cars.

I've met celebrities and at once became aware that they are really just human beings in the often very awkward position of having to be available to everyone, even when they don't want to be there. News anchors have the most interesting arrangement of telling the most awful stories in cold, neutral details, without flinching at all about their personal lives or dramas therein in front of the camera.

Everyone has a different path, so envy does not a whit of good. We don't know how much suffering has been invested to acquire all that wealth, even for people who love what they do. Does all that material wealth make anyone feel any better? How much is enough? Is wealth accumulated and displayed for personal enjoyment or to give just the right impression of exclusivity? There's an interesting meme floating around on the internet:

“Trying to be happy by accumulating possessions is like trying to satisfy hunger by taping sandwiches all over your body.”

Some have attributed that quote to George Carlin. That wouldn't surprise me, but the the concept does bring up the point I'm driving at in this here article.

I'm not saying that everyone should consign themselves to a life of poverty to achieve enlightenment. That's been done by the Buddha and even he found asceticism wanting. Money doesn't bring happiness, or even cause it. It merely facilitates happiness. Even people who have money, a lot of money, have to make a choice to be happy with it.

Trying to satisfy the heart with money doesn't work. The heart is only satisfied with love. I know from personal experience. I've seen people with plenty of money who are miserable. They try to find ways to satisfy their hearts with it, but the heart doesn't see it, because the heart is in an entirely different dimension of reality than money. The heart, in all its glory, does not know money. The heart only knows love.

The heart sees things that all the other senses cannot see. You can dress up, dress down, drive your fancy car, serve the most expensive caviar and the most expensive champagne at your party, and host it all at a big fancy house you happen to own. It won't matter to your heart. Sure, you might have moments of fun and laughter. But none of that grandeur matters to your heart. The heart only knows how it is being treated by other people. That's it.

The Beatles said it best: All you need is love. Every attempt I have ever observed to demonstrate wealth, pomp, circumstance and bravado, are at best, a way of saying "I'm fine. I don't need (your) love" to the world. But deep down, no matter how tough you are, or how rich you are, or how successful you are, there is nothing quite as satisfying as a warm smile with a big hug, a kiss and a "hello" when you get home.

Thursday, October 03, 2013

Fingers of a Congressional district

I'm noticing several articles like this one, that discuss gerrymandering as a source of comfort for those who would shutdown the Federal Government in order to eliminate Obamacare. The article states that more than 80% of the districts are safe from primary threats due to the redistricting process in 2010. Democrats won the popular vote by more than 5 million in 2012, yet Republicans still maintain a measurable majority in the house. This is pretty clear evidence of gerrymandering.

Computers make it much easier to figure this stuff out. Not only is it easier to figure out where the votes are, it's easier to draw districts that make for nice comfortable spots in Congress, regardless of the party you happen to be in. During the last redistricting session after the census, Republicans enjoyed comfortable majorities in most of the state legislatures and so were able to pass new maps that heavily favored their side.

So many seats are safe in Congress that few have any worries to look forward to in the next election. 86% of the seats in the House are now considered safe from any potential primary election adversaries. More than half of the House is Republican, so that they can safely pass any law they want, but they cannot overcome a veto. They were happy to charge into a budget negotiation without funding for Obamacare, but they do not have the votes to override a veto, nor do they have the votes in the Senate to pass a budget bill, either. Perhaps Ted Cruz did not have an exit plan if his bid for the presidency fails.

Some are predicting that this shutdown will last longer than the shutdown of 1995, and with that comes a greater risk that people will remember the loss of economic demand imposed by the shutdown. Instead of a few days, it is anticipated that this shutdown may last weeks.

When people are confident, they make interesting decisions. The House Republicans seem to carry conviction with them that what they are doing is right. Is that so?

Obamacare provides for new health insurance exchanges in all 50 states. Since midnight, October 1st, more than 2.8 million visitors crushed the new exchange website with traffic, according to Reuters. If Republicans really believe that they are doing the right thing in fighting Obamacare, if they truly believe that Obamacare would damage the economy, how do they explain the intense demand for the insurance exchanges?

The data will show us how this will play out. Billions of mouse clicks and keystrokes will build data that will show us if Obamacare works. It's only a matter of time. The longer we get to see it in action, I suspect that the more nervous people in those gerrymandered districts will be. They may be in safe districts, but they are not impervious to electoral defeat when the act they fought so hard against, and their willingness to shut down the government over it, proves to be good for the American people.

If Republican initiatives and agendas can win on the merits, why do they need to resort to gerrymandering?

Tuesday, October 01, 2013

Saving money at the source, the open source way

The French armed forces have figured out a way to save money with open source software. What exactly does this mean?

For a long time they have been using Windows and proprietary software that runs on top of Windows. You know, Microsoft Office, Photoshop, QuickBooks. They knew there was a better way, but they wanted to make the transition slower, easier on their users. What did they do?

They started by replacing Microsoft Office with OpenOffice. Then they replace Internet Explorer with Firefox. They replaced Photoshop with the GIMP. When all of the proprietary applications they were using were replaced while running Windows, they replaced Windows with Ubuntu. By then, everyone was already using the tools they were familiar with so changing the operating system wasn't a big deal to their users.

The French Gendarmerie have saved 40% on their IT costs for each computer built with Ubuntu. Now that the French have years of experience behind them, and the numbers to back it up, there is no argument Microsoft can offer to counter the cost savings. This isn't a theoretical projection. This is hard data from experience that provides demonstrable results.

Strange. This is a significant cost savings, but I don't hear the Tea Party expressing an urge to shutdown the government to get it to use Ubuntu Linux rather than Windows.