Monday, December 31, 2012

Happy New Year! - I'm already two deep into my Sam Adams stash so this will likely be my last post of the evening.  What?  You want more content?  I'm just one man!  But I'll try my best, dear reader.  Happy 2013.

By the way, this is how my New Year's Eve started: my 17-year-old and I raced to complete this logic puzzle.  We both got the correct answer but he beat me to the solution by twenty minutes.  Sigh.
No deal - Zero Hedge: "InTrade odds of deal by December 31 plunge to 2.2%."
The California disease is spreading - Detroit News editorial: "Unfunded mandates could cripple state."  Unlike the federal government, the states can't just print money and/or get Ben Bernanke to buy up debt.

Sunday, December 30, 2012

Dopey joke I heard today

Rick Astley said you could borrow any of the movies in his Pixar collection except one.

He's never gonna give you Up.

Saturday, December 29, 2012

Pay now or pay (much more) later - Here's Greg Mankiw in the NY Times "Wishful thinking and middle-class taxes."  "Ultimately, unless we scale back entitlement programs far more than anyone in Washington is now seriously considering, we will have no choice but to increase taxes on a vast majority of Americans. This could involve higher tax rates or an elimination of popular deductions. Or it could mean an entirely new tax, such as a value-added tax or a carbon tax."  The money has to come from somewhere.
Depardieu wins! - Fox News: "French panel overturns 75% upper tax rate, saying it's excessive."  Check this out: the council said the tax was "unfair" and "would do little to stem the country's mounting fiscal problems."  Crazy, I know.

Friday, December 28, 2012

Nothin's gonna stop this debt train - Weekly Standard: "The Real Cliff."  "It is important to understand that the fiscal cliff is a charade." 

Thursday, December 27, 2012

Pessimistic - Weekly Standard: "Consumer confidence craters."  And it looks like uncertainty suppressed holiday retail sales.  Hey, I tried to stimulate the economy today by buying a new car battery.  For the record, there's nothing like hearing the enervated *click* of a dead ignition after a holiday snow storm.
This Krugman is a mercurial fellow - Prof. Greg Mankiw notes that our least favorite economist has shifted his position on the bond market over time.
You can set aside the "come together" nonsense - As Zero Hedge notes, nothing is going to happen with these fiscal cliff negotiations until everybody feels a swift kick in the wallet: "The only 3 charts needed to understand the fiscal cliff resolution process."
Math is cruel as seen in the case of 789 - Frank Fleming: "Math is coming."  "Right now the Republicans and Democrats are hotly debating which of their two wholly inadequate plans we should use to avoid the fiscal cliff, but looking at the size of the deficit, they’re proposing different-sized Band-Aids where a tourniquet is needed. If you point this out, you’re called a Tea Party extremist who wants to throw old people off a cliff and deny underprivileged Ivy League law students free birth control."

Math doesn't care about your Fairness.  Math is honest and unmerciful.

Wednesday, December 26, 2012

"Starve the beast" hasn't worked.  It's time to "Present the check." - I like this post by Veronique de Rugy: "A little symbolism to fight fiscal denial."  She links to a Tyler Cowen piece that proposes a very small increase in taxes for everyone to go along with the tax hikes on the rich so beloved by this President.

After all, if Americans want to have a government spending at the unprecedented (peacetime) level of >25% of GDP, why not pay for it instead of pretending that a handful of "millionaires and billionaires" will cover the tab?  And why we're even talking about avoiding the less-than-painful sequester cuts is beyond my ken.
Good news/bad news - Toronto Sun: "Youtube video wins Norwegian kicker Havard Rugland tryout with New York Jets."

Tuesday, December 25, 2012

Sunday, December 23, 2012

Not just for pipe insulation anymore - Saw this in the Boston Globe today: "Injectable foam could stanch internal bleeding."  This sounds like something from a cartoon: the foam is injected through the navel to spread throughout the abdominal cavity and apply pressure to internal organs.

Friday, December 21, 2012

Thursday, December 20, 2012

The aging world and the shrinking workforce - Here's an interesting - and terrifying - statistic from a Weekly Standard article titled "The Demographic Cliff": at its current fertility rate, Japan will lose more than half its population by 2100.

All across the world, birth rates are insufficient to replace the population much less support the considerable costs of a nation of retirees.  So far the United States has stayed ahead of the curve until now: "U.S. birth rate falls to record low."

And here's a further sign-of-the-times: Santa Claus is disappearing from malls.  Not enough kids.

Gaming the Lemon Law - The Truth About Cars has a great story about L.A. scammers who roll back odometers, puncture brake lines, and otherwise take luxury car leasers on a ride.
American Pulverizer Company v. Obamacare - The Corner: "Does a businessman in America have religious conscience rights?"

Wednesday, December 19, 2012

Chained CPI of fools

One of the fiscal cliff solutions being proposed is a change to the way inflation is calculated called the "chained CPI."  Since cost-of-living-adjustments (COLAs) for entitlements are based on inflation adjustments, the chained CPI changes the way inflation is calculated.  Very briefly, instead of taking a calculation based on the price of a list of goods, the chained CPI - realistically - assumes that you would pay a lower price for a substitution.  In other words: if beef prices rise, you wouldn't (necessarily) buy beef, you'd buy chicken.  That's it.  So moving to a chained CPI would very slightly arrest the rise in Social Security spending.

Naturally, that means we're pushing Grandma over a cliff and making our war-hero Grandpa to eat cat food:
“If we don’t do this right, we could be asking old, poor elderly people to make some pretty terrible choices,” said Jared Bernstein, former economic adviser to Vice President Joe Biden and now a senior fellow at the Center on Budget and Policy Priorities.
Oh, yes, awful Sophie-like choices.  Behold the horrible reckoning:
For Social Security beneficiaries, the effect would barely be felt in a one-year period. In most years, chained CPI differs from the other inflation measure very little -- only by about 0.3 percentage points, according to the Social Security Administration's chief actuary. This year, for example, that would shave about $4 a month off the cost of living increase for the average Social Security recipient. Currently slated for a $21-dollar-a-month increase, the average Social Security recipient would instead receive a boost of only $17 a month.
What kind of country are we living in if we deny our seniors their monthly TV Guides, cappuccinos, and matinee movies?  I don't know...I just don't know.

Extra - Hit & Run: "What the chained CPI debate tells us about the politics of entitlement reform."

Tuesday, December 18, 2012

Things that happen in "The Little Rascals" and "Mr. Magoo" cartoons - CBS News: "Car backfire believed to have caused school lockdown."

I have to say: I've been driving for several decades and never in my life have I heard a car backfire.  I think it's an artifact from hand crank and carburetor days.  Yet it happens on TV with the same frequency as amnesia and getting trapped in an elevator with a pregnant woman.

Monday, December 17, 2012

Not even close - National Journal: "GOP movement on taxes still leaves huge budget quandary."  At this late in the game, any fiscal cliff action is going to be a fig leaf to get past the holiday season.

Saturday, December 15, 2012

The Economist explains the fiscal cliff

I got nothing

Well, all I'm going to say is that virtually everything reported yesterday about the Newtown shooting is wrong.  Time to take a break and pray for the victims.


Thursday, December 13, 2012

The other side of the ledger - Washington Post editorial: "But there's no way to fix America's problem without doing something on entitlements."
Speaking of outlandish assumptions - Hit & Run: "Latest news in California's skill at revenue projection: it still sucks."
Hands off Medicare and let it go bankrupt on its own

Nancy Pelosi, who is entirely inconsequential to the fiscal cliff negotiations, nevertheless felt it was important to scare Grandma about raising the Medicare eligibility age. As Daniel Foster quips, it's "not great" as Pelosi strongly implies that seniors are going to wake up tomorrow to find their Medicare gone. Nobody believes it, but so what? It's all about standing tall, crying "Medicare forever!"

Leave it to those spoilsports at the Medicare Trustees Board to crunch the numbers. In a little more than a decade, the Medicare Trust Fund will be exhausted leading to automatic benefit cuts:

The projected date of HI Trust Fund exhaustion is 2024, the same date projected in last year's report, at which time dedicated revenues would be sufficient to pay 87 percent of HI costs. The Trustees project that the share of HI expenditures that can be financed with HI dedicated revenues will decline slowly to 67 percent in 2045, and then rise slowly until it reaches 69 percent in 2086.
Not to worry: Obamacare is here to save the day with a series of outlandish assumptions and/or unicorn intervention:
Most of the ACA-related cost saving is attributable to a reduction in the annual payment updates for most Medicare services (other than physicians’ services and drugs) by total economy multifactor productivity growth, which the Trustees project will average 1.1 percent per year. The report notes that sustaining these payment reductions indefinitely will require unprecedented efficiency-enhancing innovations in health care payment and delivery systems that are by no means certain. In addition, the Trustees assume an almost 31-percent reduction in Medicare payment rates for physician services will be implemented in 2013 as required by current law, which is also highly uncertain.
This last point refers to the "doc fix" which is the permanently temporary adjustment to Medicare reimbursement rates that Congress enacted to control costs and then regularly overrides.  To say that a 31% reduction in payments to Medicare doctors is "uncertain" is a vast understatement.

The Trustees conclude by urging Washington to take action so Americans have "adequate time to prepare" to the changes that will be made to the system under current law.  Instead, Nancy Pelosi wants you to believe this sinking ship will make it to harbor if we just get 2% of the crew to pull harder.

Wednesday, December 12, 2012

Ravi Shankar

I heard this on NPR this morning - inspiring:
A few winters ago in Delhi, remembering those demanding early years of sitar studies, Ravi Shankar said his guru's most important lesson was this: "He says that we have to earn our livelihood, and for that we have to perform and accept money. But music is not for sale. The music that I have learned and want to give is like worshipping God. It's absolutely like a prayer."
Deep, man.  Rest in peace.

Tuesday, December 11, 2012

Yuuuuuup, that show is fake - USA Today: "'Storage Wars' star says show is rigged."

This is the least-surprising news story on the wire today.  If you haven't seen "Storage Wars" it follows a group of buyers who bid on abandoned storage units which - inevitably - hold some hidden treasure.  There's always a "hey, what's this?" moment followed by a trip to an antique shop or an expert who tells the astounded (sometimes disappointed) buyer the true worth, always played to high dramatic effect.  After a while, the sheer implausibility of these "special" finds became too much.
Preserving the proud union tradition - The Truth About Cars: "Chrysler's drunk, stoned autoworkers are back making cars."  "The workers followed a grievance procedure process outlined in the Collective Bargaining Agreement between Chrysler and the United Auto Workers. The matter went to arbitration. Two years later, an arbitrator decided in the workers’ favor, citing “insufficient conclusive evidence to uphold the dismissals.”  Apparently, a video wasn’t good enough."
Down periscope - We're getting that sinking feeling again.  The Hill:: "Both White House and GOP deficit plans put nation's credit rating at risk."  That's because nobody is serious about the challenges we face.

Monday, December 10, 2012

The conspiracy to keep you poor and stupid - According to this Nick Kristof article in the NY Times, the slogan for some is "The Less You Know": "Profiting from a child's illiteracy."

Extra - Michael Barone: "Soul-crushing dependency."
The escalator is broken - Robert Samuelson: "Is the economy creating a lost generation?"  Younger workers - burdened by debt and unable to move to better jobs - are putting off marriage and starting families.
Simpler times

I love how the dog waits for the kid to finish up:

Sunday, December 09, 2012

Put it on the Bank of China credit card - Doug Ross: "Charting a grim milestone: Federal government now borrows 46 cents of every dollar it spends."
Whither the universality of entitlements? - The Hill reports that Democrats are re-thinking means testing of Medicare: "Democrats warm to Medicare change that the late Sen. Edward Kennedy opposed."

In the past, Democrats opposed means testing because it was thought it would erode the political support of programs that are supposed to be available to all Americans.  But given that socking the rich is the only hammer in Obama's toolbox, it's going to be on the table.
Just wait 'til next year

Normally I get incensed when Washington doesn't do its job.  After all, these guys normally work only three days a week for about 40 weeks a year.  But I like this year-end Christmas strategy proposed by Professor Jacobson:
I say call his bluff. If a deal which tackles deficits from both revenue and spending can be reached this month, great.
If not, pass a 90 day extension of current tax rates and whatever else is needed to postpone the “cliff,” and go home for Christmas to give time for a Grand Bargain which puts Democratic sacred cows on the table.
Let Harry Reid refuse to bring it to a vote, and Obama refuse to sign it. Their inaction will be the reason for taxes rising for everyone.
I know, I know, more playing politics.  But there's a practical reason for delay: this is a lame-duck Congress operating under the pressure of a self-imposed deadline.  Let the new Congress take their seats, let the committee re-shuffle chairs, and set up a little breathing room to make a deal.
Take a wild guess which state this story comes from - NPR: "School district owes $1 billion on $100 million loan."  Did you guess California?  Good for you.

Saturday, December 08, 2012

FICA thanks you for your contribution - Doug Ross: "A public service message for America's youth: here's how you're being ripped off."
In the red - Boston Herald "A Social Security myth": "Sen. Dick Durbin (D-Ill.) said the other day Social Security “has not added one penny to our deficit.” Can’t anyone drive a stake through the heart of this misleading ancient myth?"
Returning to flyover country - College Insurrection: "Harvard workshop - helping students cope with being such special people."

Friday, December 07, 2012

Not an honest soul in Washington

Via Hit & Run here's "Americans don't need higher taxes.  But they do need an honest appraisal of their choices."
The real problem here is that the public isn’t getting the sort of honest appraisal it deserves. Republicans tend to focus on tweaks to the entitlement system that won’t produce big savings. Democrats heavily emphasize tax hikes on the wealthy that won’t come close to providing the sort of fiscal course correction the federal government needs. But neither side talks seriously about the fundamental budgetary challenges the country faces—or the kinds of policy solutions that addressing those challenges might require.
Yet what the CBO has made clear over and over again is that what we need are big changes, the kind that won't be easy: “Making policy changes that are large enough to shrink the debt relative to the size of the economy—or even to keep the debt from growing—will be a formidable task.” Right now it’s a task that neither party is up to. And that goes a long way toward explaining why we're our current impasse. We don't necessarily need higher taxes to resolve our budget woes. But we do need politicians willing to level with the public about the scope of the policy changes that will eventually need to be made. 
Maybe I should go full libertarian and be done with it.  The other day, Drew Musings had two simple charts showing the utter inadequacy of Obama's tax hikes in addressing the deficit.  What's even more shocking, in my opinion, is that letting all the Bush tax cuts expire still wouldn't cover half of what we're currently borrowing.  On the spending end, we can't even agree to raise the eligibility ages for Social Security and Medicare even though Americans are living much longer and the costs of entitlements are poised to overwhelm the entire federal budget.

It used to be that politicians needed to make hard decisions.  Now they choose not to choose...and they get re-elected.
Hunting the great white collar - Commentary: "Barack Obama as Captain Ahab."  There be "fairness" out there, me hearties.
We're in this sinking ship together - Mickey Kaus: "Why Social Security is not like Medicare."

Thursday, December 06, 2012

The other deficit problem

In "Our Demographic Decline", Megan McArdle discusses how future fiscal promises are dependent on a growing population and how America isn't keeping up.
Those promises can be abrogated, of course. By law, Social Security will stop paying benefits in excess of its intake as soon as the "trust fund" is exhausted. And even in the absence of such provisions, governments can default, companies can declare bankruptcy. Or debts can be inflated away. But then what happens to the folks who planned futures around those promises? 
This is an important question for everyone, not just the unlucky retirees or welfare state beneficiaries who find themselves on the wrong side of fiscal history. This kind of mass default is going to undermine social cohesion and create a great deal of economic chaos. It's also going to radically alter the incentives to save and invest. Any form of saving beyond simply stockpiling food and ammunition is a sort of trade deal with the future: you create capital stock now, on the assumption that workers of the future will let you share in the extra productivity your savings helped create. If the future reneges, people may decide that they might as well be a grasshopper, since the ant gets just as screwed.  
The fiscal and demographic problems of entitlements are inextricably linked and virtually unsolvable, given the political backlash if baby boomers don't get what's theirs.  Time to go full Grasshopper.

Wednesday, December 05, 2012

Tuesday, December 04, 2012

Yawn: another government agency warns about entitlements - Nobody cares, GAO.  Hot Air: "Friendly reminder from the GAO: You're about to hit the entitlement iceberg."  Or as James Pethokoukis says: "Another day, another government agency, another scary debt chart."

Debt at 200% of GDP?  Put it on my bill.
Holy cow! - As a kind of joke, I was looking on Amazon for a Coleco Football game from the early 1980s. $80 bucks!  Geez, I should have stockpiled 'em when I was in junior high.

Monday, December 03, 2012

New toy - I played Santa and got myself a Google Chromebook.  So far, so slick.

Sunday, December 02, 2012

Possibly a spoof

I don't know if this is real or not (a 3-minute voicemail?) but it had me crying laughing:

Thanks for subsidizing our retirement kids! - Powerline: "One generation got old; one generation got sold."  I warned you youngsters but did you listen?  Nope.

Saturday, December 01, 2012

The nation's largest employer makes the move

Huffington Post (h/t Gateway Pundit) has the latest "find out" on Obamacare: "Walmart's new health care policy shifts burden to Medicaid, Obamacare."
Labor and health care experts portrayed Walmart’s decision to exclude workers from its medical plans as an attempt to limit costs while taking advantage of the national health care reform known as Obamacare. Among the key features of Obamacare is an expansion of Medicaid, the taxpayer-financed health insurance program for poor people. Many of the Walmart workers who might be dropped from the company’s health care plans earn so little that they would qualify for the expanded Medicaid program, these experts said.
“Walmart is effectively shifting the costs of paying for its employees onto the federal government with this new plan, which is one of the problems with the way the law is structured,” said Ken Jacobs, chairman of the Labor Research Center at the University of California, Berkeley.
Thank you, Captain Obvious.
Perish the thought - Washington Examiner: "Anxious Republicans skeptical of the president's fiscal cliff plan and proposed $1.6 trillion in new taxes, mostly on the wealthy, are worried that the administration is planning new spending programs, not debt payments with the money."  (H/T Instapundit)
Pilot of the Airwaves

Gosh, I love this song.  Reminds me of younger days and stuff.