Something to bear in mind:
Many who say we need to cut the deficit now are saying we need to because it's too big, and it's better to cut now than have to pay even more later.
Here's a thought though: the likely result of cuts is that the economy will weaken. Now, this immediately creates a problem in that fiscal revenues will drop, and so the deficit isn't going to drop by anything significant. Worse still, in practical terms, it'll become much more difficult to pay off, for the same reason that it's easier to pay a $100,000 mortgage if you have a $75,000/year job, than a $10,000 credit card debt if you don't.
But leave that aside from now. If the economy, as seems all but certain, contracts as a result of cuts in short term spending, what's the next step in terms of what government will do? Will it cut spending even more, with unemployment continuing to get worse?
No, eventually - whether that's in 2012, 2016, or 2020 - will realize it has to spend more to stimulate the economy. And because the economy will, by that point, be considerably worse than it is now, the size of the stimulus the government will inevitably have to provide will be much, much, larger than what it'd need to pay now.
Now if you want you can tell me "Squiggie, stimuli don't work, look at the last one" but frankly, aside from being wrong (we didn't, over-all, actually have a stimulus - the totality of government jobs actually decreased by HALF A MILLION during the last two years), the reality is that a larger stimulus, that's actually in line with what economists were calling for originally is inevitable if the economy doesn't improve. Do you really want to bet, with no serious efforts being made towards job creation in the current government, with likely lower incomes for the retired, government workers (those that remain), and the unemployed, that some how unemployment's going to make drastic drops any time soon?
Making cuts now doesn't make the deficit smaller, except in the very short term. In the medium term, cuts now will result in deficits that make this one look like my credit card bill.
Sunday, July 31, 2011
Saturday, July 30, 2011
What's the point?
So on Friday it hit me. It wasn't just that I disliked Reid's plan to solve the debt limit crisis, it was that it was clearly going to severely damage the economy and, thus, I started to question whether it even matters if it, or the slightly worse Boehner plan, actually passes or whether we "default".
Here are some random thoughts on the issue, which may or may not answer some of the questions I got after I tweeted the White House the same question.
Macroeconomic models
There are multiple schools of thought on the subject of what severe cuts will do to the economy. Virtually all modern macro-economics is descended from the Keynesian models. A disagreement occurred in the fifties and sixties about the effect of government borrowing and spending, with mainstream Keynesians arguing it has a positive affect during recessions, while a branch, Monetarists, arguing that it has the potential to "crowd out" private borrowing, but actually there's quite a bit of consensus outside of that argument. Both branches and their descendants are adamant that during a recession you have to increase the amount of money in circulation, they just differ on how to do that.
That "crowding-out" argument
Generally speaking, you use market interest rates to determine whether the government is borrowing too much. Interest rates are lower than they've been in a very, very, long time. Maybe that's too simple: the Fed's monetary policies also affect interest rates, so the flooding of the economy with QE/QE2 money might explain this - however, we can determine whether the Fed has pumped too much money into the economy by looking at so-called "Core Inflation". Core inflation is virtually non-existent, ergo the Fed's monetary expansion hasn't put in too much money, and interest rates being low is consistent with the government not crowding out private borrowing.
So it's safe to say that no monetarist is going to make the argument, and remain respected, that spending and borrowing cuts right now would in some way reduce any crowding out, as evidently crowding out just isn't happening. They would argue this in slightly different circumstances, but these aren't times that fit the model, any more than stagflation fits the original Keynesian model.
The affect of less government spending
Quite simply we're looking at contraction. No widely respected macro-economic model right now that applies to the current case - negligible interest rates, negligible core inflation, increasing unemployment - promotes reduced economic activity as a way to increase economic activity.
There's no "deficit crisis"
This is one thing that's annoying the hell out of me. There's a large deficit, and that's not good, but it's certainly manageable - get the economy going again, get some growth going, as unemployment drops start increasing tax rates, and a combination of reduced expenditures on things like unemployment relief programs (which are obviously somewhat less expensive when there's less unemployment) and increased revenues, will give the government a surplus it can use to pay down the deficit.
Unfortunately the media keeps promoting the term, which means we're sleepwalking into making the crisis work. You see, if we go for contractionary policies now, and reduce taxes, then we really will have a deficit crisis because there's not going to be growth, there's not going to be the revenues needed to build a surplus, and vital government support services will become ever more expensive.
The "Debt limit" combined with the current budget is clearly unconstitutional
Forget the 14th amendment, congress is clearly giving the executive conflicting mandates. Unless some extremely clever lawyer can determine a way to resolve both mandates, then one or other mandate is simply not legal.
Things that just don't make sense
The arguments for fixing the deficit now are:
Should we default?
No, we should raise the debt limit and increase spending for now.
Should we default if the alternative is decreasing spending?
No, we just shouldn't care. The idea that Obama is pushing Reid's plan is utterly ridiculous. Why waste the time? From what I can tell it's a stupid point scoring thing. If the debt limit cannot be raised in time, so be it.
What about the economy makes normal people lay awake at night? High unemployment, or government borrowing?
High unemployment.
Here are some random thoughts on the issue, which may or may not answer some of the questions I got after I tweeted the White House the same question.
Macroeconomic models
There are multiple schools of thought on the subject of what severe cuts will do to the economy. Virtually all modern macro-economics is descended from the Keynesian models. A disagreement occurred in the fifties and sixties about the effect of government borrowing and spending, with mainstream Keynesians arguing it has a positive affect during recessions, while a branch, Monetarists, arguing that it has the potential to "crowd out" private borrowing, but actually there's quite a bit of consensus outside of that argument. Both branches and their descendants are adamant that during a recession you have to increase the amount of money in circulation, they just differ on how to do that.
That "crowding-out" argument
Generally speaking, you use market interest rates to determine whether the government is borrowing too much. Interest rates are lower than they've been in a very, very, long time. Maybe that's too simple: the Fed's monetary policies also affect interest rates, so the flooding of the economy with QE/QE2 money might explain this - however, we can determine whether the Fed has pumped too much money into the economy by looking at so-called "Core Inflation". Core inflation is virtually non-existent, ergo the Fed's monetary expansion hasn't put in too much money, and interest rates being low is consistent with the government not crowding out private borrowing.
So it's safe to say that no monetarist is going to make the argument, and remain respected, that spending and borrowing cuts right now would in some way reduce any crowding out, as evidently crowding out just isn't happening. They would argue this in slightly different circumstances, but these aren't times that fit the model, any more than stagflation fits the original Keynesian model.
The affect of less government spending
Quite simply we're looking at contraction. No widely respected macro-economic model right now that applies to the current case - negligible interest rates, negligible core inflation, increasing unemployment - promotes reduced economic activity as a way to increase economic activity.
There's no "deficit crisis"
This is one thing that's annoying the hell out of me. There's a large deficit, and that's not good, but it's certainly manageable - get the economy going again, get some growth going, as unemployment drops start increasing tax rates, and a combination of reduced expenditures on things like unemployment relief programs (which are obviously somewhat less expensive when there's less unemployment) and increased revenues, will give the government a surplus it can use to pay down the deficit.
Unfortunately the media keeps promoting the term, which means we're sleepwalking into making the crisis work. You see, if we go for contractionary policies now, and reduce taxes, then we really will have a deficit crisis because there's not going to be growth, there's not going to be the revenues needed to build a surplus, and vital government support services will become ever more expensive.
The "Debt limit" combined with the current budget is clearly unconstitutional
Forget the 14th amendment, congress is clearly giving the executive conflicting mandates. Unless some extremely clever lawyer can determine a way to resolve both mandates, then one or other mandate is simply not legal.
Things that just don't make sense
The arguments for fixing the deficit now are:
- We don't want to make things more difficult when we do start to pay it off
- The debt causes uncertainty in the markets
- We need to be more fiscally serious and disciplined to prevent this kind of thing from happening.
- Promoting contractionary policies
- Demanding regular votes on the debt limit, often with utterly absurd riders or conditions, that'll result in this "crisis" occurring again, increasing "uncertainty" in a way that really is happening.
- Promoting tax cuts at a time of historically already low taxes.
Should we default?
No, we should raise the debt limit and increase spending for now.
Should we default if the alternative is decreasing spending?
No, we just shouldn't care. The idea that Obama is pushing Reid's plan is utterly ridiculous. Why waste the time? From what I can tell it's a stupid point scoring thing. If the debt limit cannot be raised in time, so be it.
What about the economy makes normal people lay awake at night? High unemployment, or government borrowing?
High unemployment.
Thursday, July 28, 2011
Desperate and unusual measures
Rupert was not surprised to get the call. You didn't have to have fifty years as a Senior White House Correspondent to know that the government would be making an announcement the day before the debt limit crisis hit. The only question was what were they going to say? Did the two sides ultimately come to an agreement, or was Obama planning to use the fourteenth amendment as many had advocated. Rupert grabbed his coat, and hurried to the Metro station, and then, onwards to the White House.
There was a hush as The President, Senator Reid, Treasury secretary Timothy Geithner and Fed Chairman Ben Bernanke entered the room. The President stepped to the podium, looking grim.
"Good morning", said the President. "I'm going to make a brief statement concerning the negotiations over the debt limit."
The President looked around him, and bowed his head, reading the paper in front of him.
"Quite honestly, we're fucked."
There were gasps of horror across the room. Timothy Geithner stepped forward, and motioned at the President to move away.
"What the President means is... we're totally screwed. The entire economy is going to collapse at midnight tonight."
Bernanke nodded his head and stepped forward. "We're talking pretty much about an monetary apocalypse here. The US government is going to completely default on everything. I mean, I'll try to help, of course, but, well, I'm pretty much out of ideas. We have a liquidity trap, and, well, I can't do much now, pretty much by definition."
Rupert's shock did not prevent him from noticing what appeared to be a glimmer of a smirk from Bernanke. Why? What about this terrible announcement could Bernanke see as remotely funny?
...
Rupert fired off a report on his Blackberry, and then went home. He switched on the TV, and watched gloomily as the chaos began. The markets, which had been surprisingly high that morning, completely collapsed. The Dow was down 60%. The S&P 75%. Rupert expected the markets to close at any moment to contain the mayhem, but they stayed open, with stock after stock sliding into worthlessness. And, just after lunch, the markets stopped falling, there was a sudden spike, but everything was still down.
Rupert's Blackberry buzzed again. Another conference at the White House. Well, that was to be expected. Depressed, Rupert half intended to watch it on TV, but he grudgingly got up and went back to see what the President had to say.
Another hush as the The President, Senator Reid, Treasury secretary Timothy Geithner and Fed Chairman Ben Bernanke entered the room. This time the four were smiling. Had they found a way to prevent the crisis? Perhaps an agreement had been reached as the various sides saw the consequences of their actions?
The President stepped to the podium.
"Good afternoon", the President said. "I have a brief statement. Desperate times call for desperate, and unusual, measures. So this morning, before this morning's Press Conference, I instructed Timothy Geithner to invest what remained of our liquid funds into shorting the S&P. I'm pleased to announce that we now have all the money we need to completely pay off the deficit!"
Reid approached the podium, and, looking up, grinning, exclaimed: "Suck on that, Boner!"
"Bay-ner", said Obama, but Reid shook his head. "I'm sticking with "Boner"!" said Reid.
The four laughed, and left the room.
Wednesday, July 27, 2011
Google+, pseudonymity, and me
People for, whatever perverse reason, follow my comments know that I don't generally publish under my real name. The reason's fairly simple: back when I was working for a company called Snap-on Business Solutions, the company had a policy that specifically discouraged blogging, and made it clear that it didn't want anything anyone wrote on a blog tracked back to it.
And at the same time, I wanted the freedom to be able to say "My boss was a total asshole today" without anyone going "Oh, he's talking about" and drawing a long term conclusion over what was actually just a vent. Which, ironically, I don't think I did, but it's still a freedom I want.
Of course, I was made redundant last year. Redundancy doesn't mean a complete severance of connections with the old employer, it's not like being fired. SBS made me sign a few forms, and they paid me a fairly decent redundancy payment, in return for keeping to the agreement. I can probably get away with publishing my name without putting any noses out of joint, given it's been just over a year now, but... but I'm reluctant to.
To begin with, I'm working again, and the new employer - while not discouraging blogging - is an actual publisher, and I happen to strongly disagree with a large proportion of what they publish. Really disagree. And then there's the fact that the "I want to say my boss is an asshole" thing is still something I want.
The downside of posting under a pseudonym is that you don't get taken as seriously as you do when posting under your real name - I'm not entirely sure I agree, an argument is an argument, it's either right or wrong, and there's a difference between posting entirely anonymously (where you can't tell what the person has posted before) and sticking with a consistent pseudonym. There's also a certain amount of risk - you're generally inclined to post more openly under the pseudonym, but it certainly wouldn't be hard for someone to connect my posts to me.
I finally did get a Google+ invite, so I'm on it, but not as squiggleslash. Google+ bans pseudonymity, so I have to be "myself". But, well, of course I'm not going to be "myself". Myself is someone I can't expose on the Internet, not under my name, not completely anyway, any more than anyone can be themselves at their office.
Still, I like Google+. The circles thing is one of the easiest privacy things I've seen, I think they've done a good job, and I'll be making a concerted effort to make it work for me.
And at the same time, I wanted the freedom to be able to say "My boss was a total asshole today" without anyone going "Oh, he's talking about
Of course, I was made redundant last year. Redundancy doesn't mean a complete severance of connections with the old employer, it's not like being fired. SBS made me sign a few forms, and they paid me a fairly decent redundancy payment, in return for keeping to the agreement. I can probably get away with publishing my name without putting any noses out of joint, given it's been just over a year now, but... but I'm reluctant to.
To begin with, I'm working again, and the new employer - while not discouraging blogging - is an actual publisher, and I happen to strongly disagree with a large proportion of what they publish. Really disagree. And then there's the fact that the "I want to say my boss is an asshole" thing is still something I want.
The downside of posting under a pseudonym is that you don't get taken as seriously as you do when posting under your real name - I'm not entirely sure I agree, an argument is an argument, it's either right or wrong, and there's a difference between posting entirely anonymously (where you can't tell what the person has posted before) and sticking with a consistent pseudonym. There's also a certain amount of risk - you're generally inclined to post more openly under the pseudonym, but it certainly wouldn't be hard for someone to connect my posts to me.
I finally did get a Google+ invite, so I'm on it, but not as squiggleslash. Google+ bans pseudonymity, so I have to be "myself". But, well, of course I'm not going to be "myself". Myself is someone I can't expose on the Internet, not under my name, not completely anyway, any more than anyone can be themselves at their office.
Still, I like Google+. The circles thing is one of the easiest privacy things I've seen, I think they've done a good job, and I'll be making a concerted effort to make it work for me.
Tuesday, July 26, 2011
How it'll go down
(The Whitehouse lawn, 1st August 2011. The President walks out with John Boehner, Nancy Pelosi, Harry Reid, and Mitch McConnell, to a packed Press conference.)
The President: Good afternoon. I'm very pleased to announce that after many months of negotiations, we have finally hammered out a compromise and will be able to raise the debt ceiling. Mr Boehner?
Boehner (smirking): Oh yes, I'm very pleased that despite the usual partisan politics from the Democrats, they've agreed to accept our proposed compromise. In return for raising the debt ceiling until September, we are announcing an end to social security, with the remaining funds being given to anyone earning over 250,000 dollars a year. To help with, uh, job creation. Yes. And now, I believe my colleague Mrs Pelosi, would like to say something.
Pelosi steps up to the podium looking somewhat sheepish.
Uh.
Boehner: Say it! You agreed, remember?
The President: Oh don't make a fuss Nancy, just say it. We agreed.
Pelosi (sighs) Uh, ladies and gentlemen of the press. Uh (looks at Boehner) I am a poopypants. I poop my pants. Also I am a man. And I'm ugly and smell. Also I am a loser.
Boehner: Thank you Mrs Former Speaker. Now, Mr President.
The President: (apparently completely unfazed) Of course, Mr Speaker, ladies, gentlemen, of the press. My fellow Americans. I, and my fellow Democrats, are stupid. And I am a socialist. And I want to take your guns. And I poop my pants. Poopy poopy, poopy, poopy.
Boehner: Thank you Mr President.
The President: Can I say one more thing?
Boehner: That depends on what it is.
(The two confer. Boehner nods his head and President Obama returns to the podium.)
The President: Mr Boehner is the greatest man who ever lived and it will be a privilege to welcome him to the Presidency in 2013. The only reason Joe and I don't resign right now is because the two term limit would deprive us of two years of President Boehner.
(Even Boehner looks surprised.)
Boehner: Thank you Mr President. Are there any questions? Yes, the bimbo from Fox News.
Bimbo: Thank you President Boehner. Do you feel that the compromise you have negotiated with the Democrats makes too many concessions to their far left agenda?
Boehner: Mr President, perhaps you can answer that.
Mr President: We are quite happy to renegotiate the agreement should Mr Boehner find any problems with it whatsoever.
Boehner: Thank you Mr President, and thank you all for coming.
Mr President: Our pleasure Mr Speaker!
The President walks back to the White House, smiling. "A good day", he thinks to himself, "Everything went exactly as I hoped. Exactly as I hoped."
The President: Good afternoon. I'm very pleased to announce that after many months of negotiations, we have finally hammered out a compromise and will be able to raise the debt ceiling. Mr Boehner?
Boehner (smirking): Oh yes, I'm very pleased that despite the usual partisan politics from the Democrats, they've agreed to accept our proposed compromise. In return for raising the debt ceiling until September, we are announcing an end to social security, with the remaining funds being given to anyone earning over 250,000 dollars a year. To help with, uh, job creation. Yes. And now, I believe my colleague Mrs Pelosi, would like to say something.
Pelosi steps up to the podium looking somewhat sheepish.
Uh.
Boehner: Say it! You agreed, remember?
The President: Oh don't make a fuss Nancy, just say it. We agreed.
Pelosi (sighs) Uh, ladies and gentlemen of the press. Uh (looks at Boehner) I am a poopypants. I poop my pants. Also I am a man. And I'm ugly and smell. Also I am a loser.
Boehner: Thank you Mrs Former Speaker. Now, Mr President.
The President: (apparently completely unfazed) Of course, Mr Speaker, ladies, gentlemen, of the press. My fellow Americans. I, and my fellow Democrats, are stupid. And I am a socialist. And I want to take your guns. And I poop my pants. Poopy poopy, poopy, poopy.
Boehner: Thank you Mr President.
The President: Can I say one more thing?
Boehner: That depends on what it is.
(The two confer. Boehner nods his head and President Obama returns to the podium.)
The President: Mr Boehner is the greatest man who ever lived and it will be a privilege to welcome him to the Presidency in 2013. The only reason Joe and I don't resign right now is because the two term limit would deprive us of two years of President Boehner.
(Even Boehner looks surprised.)
Boehner: Thank you Mr President. Are there any questions? Yes, the bimbo from Fox News.
Bimbo: Thank you President Boehner. Do you feel that the compromise you have negotiated with the Democrats makes too many concessions to their far left agenda?
Boehner: Mr President, perhaps you can answer that.
Mr President: We are quite happy to renegotiate the agreement should Mr Boehner find any problems with it whatsoever.
Boehner: Thank you Mr President, and thank you all for coming.
Mr President: Our pleasure Mr Speaker!
The President walks back to the White House, smiling. "A good day", he thinks to himself, "Everything went exactly as I hoped. Exactly as I hoped."
It wasn't terrorism
I'm sure people are sick of me getting all nit-picky and stuff, but there's a difference between a lone madman killing people for ideological reasons, knowing full well he or she'll be caught, imprisoned, and never able to repeat the crime, and someone who is part of a group who does or organizes the same thing, where even if some members of group end up being caught, others will be able to take over and continue the rampage.
"Terrorism" does not mean "Anything bad I disagree with", it means attempting to promote an end using, well, terror, and a single, one-off, act really isn't promoting terror. "Terrorism" is a bad word - ie a word that means an act that's despicable - and what happened in Oslo was utterly evil, but just because it's a bad word doesn't mean it's appropriate.
We don't, for example, call Al Qaeda "child molesters". We don't say the IRA and UDF were engaged in "genocide". We don't call the Shining Path guerrillas "serial killers".
Terrorism is the word of the day, and it shouldn't be. It's been used to describe everything from the Oslo attacks to the activities of Wikileaks. Every time it is misused it devalues the word, its value, and its usefulness.
None of which should change the fact that those who have been whipping up fear and hatred against Muslims and against those who preach tolerance should be utterly ashamed of themselves.
"Terrorism" does not mean "Anything bad I disagree with", it means attempting to promote an end using, well, terror, and a single, one-off, act really isn't promoting terror. "Terrorism" is a bad word - ie a word that means an act that's despicable - and what happened in Oslo was utterly evil, but just because it's a bad word doesn't mean it's appropriate.
We don't, for example, call Al Qaeda "child molesters". We don't say the IRA and UDF were engaged in "genocide". We don't call the Shining Path guerrillas "serial killers".
Terrorism is the word of the day, and it shouldn't be. It's been used to describe everything from the Oslo attacks to the activities of Wikileaks. Every time it is misused it devalues the word, its value, and its usefulness.
None of which should change the fact that those who have been whipping up fear and hatred against Muslims and against those who preach tolerance should be utterly ashamed of themselves.
Sunday, July 24, 2011
Right and wrong approaches to fixing the economy?
I think I came up with a conclusive, unassailable, argument in terms of "What do we do now to fix the economy". That's a fairly arrogant thing to say, especially when it concerns something I already had an opinion on, but here goes:
There are two arguments concerning how we go from here. One is "Shrink the government, hand out more money to the rich."
The other is "Ignore taxes, perhaps even raise them on those who can afford to pay (eg the rich), and increase government spending."
It's actually fairly easy to pick between the two. No, really!
The issue is we have to determine which of these addresses an actual problem.
The first proposed solution is proposed by people who believe that companies are unable to invest money in creating jobs because they don't raise the money to do so. By cutting the taxes of the very rich, they'll have enough money to invest in their businesses, increasing the number of jobs.
The second proposed solution is proposed by people who believe that companies don't invest money in creating jobs because there's businesses don't see enough demand to justify increasing production capacity. Directly create jobs (by increased government spending), and you'll increase demand, resulting in businesses creating jobs to handle the extra capacity they now need.
(I happen to disagree with the basis of the first argument as I've said before - high taxes actually encourage people to leave money in their businesses and invest in them, given the way the tax system is structured, but let's ignore that for a moment and "agree to disagree".)
So which is it? Are major corporations, etc, these days having difficulties raising cash, generally making losses and finding it hard to raise money through the stock market, banks, or anything else; or are they making decent profits, and handing that money out to their shareholders through increased dividends and share buy-backs?
Well, it's pretty much the latter.
There are two arguments concerning how we go from here. One is "Shrink the government, hand out more money to the rich."
The other is "Ignore taxes, perhaps even raise them on those who can afford to pay (eg the rich), and increase government spending."
It's actually fairly easy to pick between the two. No, really!
The issue is we have to determine which of these addresses an actual problem.
The first proposed solution is proposed by people who believe that companies are unable to invest money in creating jobs because they don't raise the money to do so. By cutting the taxes of the very rich, they'll have enough money to invest in their businesses, increasing the number of jobs.
The second proposed solution is proposed by people who believe that companies don't invest money in creating jobs because there's businesses don't see enough demand to justify increasing production capacity. Directly create jobs (by increased government spending), and you'll increase demand, resulting in businesses creating jobs to handle the extra capacity they now need.
(I happen to disagree with the basis of the first argument as I've said before - high taxes actually encourage people to leave money in their businesses and invest in them, given the way the tax system is structured, but let's ignore that for a moment and "agree to disagree".)
So which is it? Are major corporations, etc, these days having difficulties raising cash, generally making losses and finding it hard to raise money through the stock market, banks, or anything else; or are they making decent profits, and handing that money out to their shareholders through increased dividends and share buy-backs?
Well, it's pretty much the latter.
Saturday, July 23, 2011
Newspapers and journalism
There are very, very, few media outlets I have anything resembling trust in these days. Now, trust is a relative word, sometimes people do their best to tell the truth, and you have to focus on that and their ability to get things right, rather than a 100% perfect record.
There are two newspapers I'm prepared to spend money on. Oddly enough, they're both British, but they also have extremely good US coverage. Does this mean I like the British media or that I like it more than the US media? Well, it's a little more complicated than that. Let's first of get "the media squiggleslash is OK with" down.
The Guardian
The Guardian - and only The Guardian, not its bastard adopted sister The Observer - is exactly what the media should be. It reports the news in depth. It doesn't focus on "he said/she said" stuff. It reports things that are inconvenient to the establishment. It investigates issues and tries to determine the core truth. It looks for stories, rather than focusing on a small core issues considered important by pundits.
Why The Guardian and not The Observer? They both share many journalists, after all, share largely the same political outlook, and, of course, are owned by the same group. Well, it's because The Observer really isn't up to the same standards. The Observer has never allowed truth to get in the way of a good story, the worst example arguably being the 1997 on-line "pedophilia" expose that smeared an ISP director and an already under attack anonymity service, the latter of which having to close shortly afterwards. I've read numerous articles in The Observer since that demonstrate the same sophistry and lack of a desire to fairly inform. I don't know how the two newspapers can co-exist.
In any case, that's not what this is about, except in that sometimes showing contrasts helps underline the point. The Guardian makes a concerted effort to find the truth and report it. In doing so, it's - on multiple occasions - been the only paper to report major establishment scandals that other papers refused to touch. I love it. I really do.
The Financial Times
The FT isn't an investigative powerhouse, but unlike its competitors, it doesn't allow rumors and cheap politics to get in the way of proper, factual, reporting. The paper is essentially a business sheet, intended to inform on the workings of business, the economy, and the markets, and it does so extremely well. The FT's biggest rival is the WSJ - but the WSJ pushes agendas, frequently simply misleading its readers quite intentionally to drive home ideological points.
The FT has, of course, an "ideology", if you can call it that, and has - with notable exceptions - tended to side with right wing governments. It's free market, pro-globalization, and its editorials reflect that. This doesn't reflect in its actual news gathering except in terms of the issues it chooses to highlight - but even those inevitably reflect those of its readers - the leeway to segue into topics of your own choosing is severely limited when you have to serve people who are only buying your paper in order to ensure they have the facts necessary to make good financial decisions.
It's a great paper.
British vs American Media
So does this mean I like the British media more than the US media? Well, no. Here's the deal.
Almost all US media, from what I've been able to tell, is essentially establishment run and focused. Some of that media, particularly Fox News and the various right wing opinion outlets, pretends not to be, but ultimately ends up pushing the same agendas - with minor exceptions to cater for its market - as the rest of the establishment. For reasons I just cannot fathom, the US establishment media considers making a real effort to determine truth and reporting it, "hysterical" and "unserious".
The result is just plain peculiar. Reading the US press feels often like falling into an alternate reality, where up is down, down is up, and investing in improvements when you're not doing so well is a bad thing to do. This is part of the reason why the FT is so much better than the WSJ - the FT actually does what it needs to do; I don't understand why anyone reads the WSJ to begin with.
The issue with the British media is somewhat more complicated. Essentially, most of it is awful. There are some honorable exceptions, and different newspapers at different times can be superb - The Times was good once, and The Independent tends to try to do what The Guardian actually pulls off. The BBC I'd put in the same class - well, maybe a little lower - as The Independent, at least, online. But for the most part, the British media is made up of newspapers that lie.
Now, I don't mean in the same way as you read US establishment media and get lied to. No. In the latter case, the US newspapers truthfully report the lies they're told. And they consider that good journalism. But the US media doesn't consider it good journalism to investigate whether what they're told are lies. That's unserious.
Most of the British media, however, just plain doesn't care whether what it reports is truthful or not. It will faithfully report rumors as fact, and use sophistry virtually all the time to imply things that simply aren't true.
How bad is it? Well, it varies. The Sun is infamous for a campaign it ran against Elton John in the eighties where it just kept making up crap about him, right down to underage sex allegations. The BBC (yes, that highly respected organ of truth) spent most of the late eighties and early nineties reporting that the Conservative party was on the verge of collapse, leading almost every single news telecast (I'm not exaggerating about this) hyping some ludicrously unimportant bit of news, along the lines of:
What you have with the British media is, essentially, a wave pattern where the highs are high and the lows are very low, the result being a media that's - on balance, worse than the US media, but with the peaks being much, much, better.
What I want out of the media
I have a few principles I'd like to see journalists respect in a way the majority really doesn't these days.
Other things I read
There are two newspapers I'm prepared to spend money on. Oddly enough, they're both British, but they also have extremely good US coverage. Does this mean I like the British media or that I like it more than the US media? Well, it's a little more complicated than that. Let's first of get "the media squiggleslash is OK with" down.
The Guardian
The Guardian - and only The Guardian, not its bastard adopted sister The Observer - is exactly what the media should be. It reports the news in depth. It doesn't focus on "he said/she said" stuff. It reports things that are inconvenient to the establishment. It investigates issues and tries to determine the core truth. It looks for stories, rather than focusing on a small core issues considered important by pundits.
Why The Guardian and not The Observer? They both share many journalists, after all, share largely the same political outlook, and, of course, are owned by the same group. Well, it's because The Observer really isn't up to the same standards. The Observer has never allowed truth to get in the way of a good story, the worst example arguably being the 1997 on-line "pedophilia" expose that smeared an ISP director and an already under attack anonymity service, the latter of which having to close shortly afterwards. I've read numerous articles in The Observer since that demonstrate the same sophistry and lack of a desire to fairly inform. I don't know how the two newspapers can co-exist.
In any case, that's not what this is about, except in that sometimes showing contrasts helps underline the point. The Guardian makes a concerted effort to find the truth and report it. In doing so, it's - on multiple occasions - been the only paper to report major establishment scandals that other papers refused to touch. I love it. I really do.
The Financial Times
The FT isn't an investigative powerhouse, but unlike its competitors, it doesn't allow rumors and cheap politics to get in the way of proper, factual, reporting. The paper is essentially a business sheet, intended to inform on the workings of business, the economy, and the markets, and it does so extremely well. The FT's biggest rival is the WSJ - but the WSJ pushes agendas, frequently simply misleading its readers quite intentionally to drive home ideological points.
The FT has, of course, an "ideology", if you can call it that, and has - with notable exceptions - tended to side with right wing governments. It's free market, pro-globalization, and its editorials reflect that. This doesn't reflect in its actual news gathering except in terms of the issues it chooses to highlight - but even those inevitably reflect those of its readers - the leeway to segue into topics of your own choosing is severely limited when you have to serve people who are only buying your paper in order to ensure they have the facts necessary to make good financial decisions.
It's a great paper.
British vs American Media
So does this mean I like the British media more than the US media? Well, no. Here's the deal.
Almost all US media, from what I've been able to tell, is essentially establishment run and focused. Some of that media, particularly Fox News and the various right wing opinion outlets, pretends not to be, but ultimately ends up pushing the same agendas - with minor exceptions to cater for its market - as the rest of the establishment. For reasons I just cannot fathom, the US establishment media considers making a real effort to determine truth and reporting it, "hysterical" and "unserious".
The result is just plain peculiar. Reading the US press feels often like falling into an alternate reality, where up is down, down is up, and investing in improvements when you're not doing so well is a bad thing to do. This is part of the reason why the FT is so much better than the WSJ - the FT actually does what it needs to do; I don't understand why anyone reads the WSJ to begin with.
The issue with the British media is somewhat more complicated. Essentially, most of it is awful. There are some honorable exceptions, and different newspapers at different times can be superb - The Times was good once, and The Independent tends to try to do what The Guardian actually pulls off. The BBC I'd put in the same class - well, maybe a little lower - as The Independent, at least, online. But for the most part, the British media is made up of newspapers that lie.
Now, I don't mean in the same way as you read US establishment media and get lied to. No. In the latter case, the US newspapers truthfully report the lies they're told. And they consider that good journalism. But the US media doesn't consider it good journalism to investigate whether what they're told are lies. That's unserious.
Most of the British media, however, just plain doesn't care whether what it reports is truthful or not. It will faithfully report rumors as fact, and use sophistry virtually all the time to imply things that simply aren't true.
How bad is it? Well, it varies. The Sun is infamous for a campaign it ran against Elton John in the eighties where it just kept making up crap about him, right down to underage sex allegations. The BBC (yes, that highly respected organ of truth) spent most of the late eighties and early nineties reporting that the Conservative party was on the verge of collapse, leading almost every single news telecast (I'm not exaggerating about this) hyping some ludicrously unimportant bit of news, along the lines of:
Good evening. In a major blow to the conservatives, sources are telling us tonight that Sir Humpton Bumpton, the MP for East Chorleywood, is upset at a proposal to build a bypass through his constituency, and has been quoted as saying "I'm jolly upset about this and I might well not vote for it when it comes up for a vote". This astonishing development can only be a major blow to Margaret Thatcher's government, an MP that has never criticized the government before has just done so. Could this spell the end for the Conservative Party as we know it? I'm joined by...Yes, the BBC was like that. No wonder it was seen by many British rightists in the eighties as "left wing biased", although I think, in reality, the BBC - suffering a policy called "Mission to Explain" at the time - was trying to make politics "interesting" by promoting drama where clearly there wasn't any.
What you have with the British media is, essentially, a wave pattern where the highs are high and the lows are very low, the result being a media that's - on balance, worse than the US media, but with the peaks being much, much, better.
What I want out of the media
I have a few principles I'd like to see journalists respect in a way the majority really doesn't these days.
- If, as a result of reading your articles, the majority of people who read your articles believe major things that simply are untrue, then you're doing it wrong.
- There is no left or right, there's an establishment. The establishment needs to earn its position as an establishment. You must tell truth to power.
- You must leave people informed about the issues that affect them, period. Not "more informed than they would have been", but positively informed.
Other things I read
- Preferred echo chamber is the Washington Post's The Plum Line - at least, when Greg Sargent writes it. Not terribly impressed by Jonathan Bernstein.
- The only thing left in Salon.com worth reading (that isn't entertainment I mean, Ask the Pilot's OK, and there's a few things like that, but the commentary sucks!) is Glenn Greenwald.
- The NYT has a column and blog by Paul Krugman.
Thursday, July 21, 2011
The economy
We're screwed.
No, honestly, we are. We have two parties: one wants to destroy what remains of the welfare economy - social security, medicare, medicaid, programs to reduce unemployment, to build and rebuild critical infrastructure, turning the US government solely into a war machine, and we also have the Republicans who want the same thing but with no taxes.
I wish there was a groundswell of a movement for a third party right now, but I don't see that happening.
No, honestly, we are. We have two parties: one wants to destroy what remains of the welfare economy - social security, medicare, medicaid, programs to reduce unemployment, to build and rebuild critical infrastructure, turning the US government solely into a war machine, and we also have the Republicans who want the same thing but with no taxes.
I wish there was a groundswell of a movement for a third party right now, but I don't see that happening.
Tuesday, July 19, 2011
Sunday, July 17, 2011
Some thoughts on the whole Murdoch/Hackergate thing
Here are some random thoughts in no particular order. They're generally based upon things I read and wanted to clarify.
- It doesn't appear that there's hard evidence in the "NotW bugged 9/11 victims" scandal. That is to say, one newspaper, the Daily Mirror, apparently is the source for the allegations, but other newspapers haven't dug up anything to corroborate the allegation.
- Even if she's entirely innocent, legally, I don't see how the person who was editor during the start of the NotW hacking campaign, and who headed the UK newspaper division of Murdoch's empire, could possibly have seen it as reasonable to not quit for as long as she did. Most executives would, at the very least, accept they had responsibility for the atmosphere that caused such acts to be committed, even if they, themselves, didn't know the specifics.
- Despite claims to the contrary, there is no threat to Fox News from this scandal. The FCC might require that the Murdoch Empire divest itself of its broadcast stations and, possibly, its broadcast network, but the FCC doesn't really have the same kind of jurisdiction on cable channels, movie studios, newspapers, or any other aspect of Murdoch's corporation. Moreover, the Fox Network is essentially apolitical, it carries very little centralized Murdochian news or comment, with the exception of Fox News Sunday.
- Despite the regulatory differences between the UK and US, and "something must be done" atmosphere in parliament, it's not entirely clear anyone in power can actually force a Murdoch exit from the UK media, with the exception of BSkyB, which has a similar legal status to Fox Network in the US.
- BSkyB is a satellite network that includes a variety of different channels. Regulatory differences between the UK and US, and the lesser influence of Murdoch within the organization, means that those channels contain very little political commentary, and are largely entertainment oriented.
- The rumors are focusing on Murdoch exiting the UK newspaper market.
- It is unclear to be how Murdoch would benefit by divesting himself of his UK newspapers.
- Murdoch uses his UK newspapers the same way as he uses Fox News in the US, propagating a kind of right wing populist rhetoric to make money and buy influence.
- Murdoch controls over 40% of the voting shares in News Corporation, despite only owning a much smaller fraction of the company itself. It is very, very, unlikely he'll be pushed out by investors. They'd have to be pretty much unanimous that he has to go.
- One of the two major parties in the US benefits immensely from Rupert Murdoch.
- I don't think Murdoch is going close/get rid of Fox News or The Sun
- I think there's sufficient plausible deniability for Murdoch to be able to shift the perceived blame on his subordinates, particularly Brookes.
- I think Murdoch may be forced out of BSkyB.
- If any effort is made to push Murdoch out of his UK newspaper holdings, I think the UK press will be concerned because of the precedent this sets, and as such I think such a move wouldn't go anywhere.
- I don't think any serious effort will be made to counter Murdoch's influence in the US.
Thursday, July 14, 2011
If only Google had a decent search engine
Three reasons why Google is an awful search engine these days, and how they can fix it.
1. If anything's obscure in your search results, Google will ignore it.
For some reason, Google are under the impression that it's more helpful to have 100,000 wrong answers, than three good ones, or even that "There's nothing like that on the web" might actually often be more helpful than pages upon pages upon pages upon pages upon pages of irrelevant, useless, links, whose lack of relevance has to be ploddingly checked one by effing one.
2. Google will change your search for no good reason
Some time ago, Google started posting, above the search results, a little note along the lines of "Did you intend to search for something or other" where something or other was your search string passed through a spell checker - or something. 98% of the time it was wrong, but occasionally something useful would come through. And then the user could click on that suggestion, and get the search results they wanted.
Not any more. Now it just automatically searches for the "corrected" version which means if you're not searching for "Brittnay speahs nood pix" but, say, the name of a product, or a code, or something else that, well, is the kind of thing you go to Google to find, you'll get pages upon pages upon pages upon pages upon pages of irrelevant, useless, links, whose lack of relevance will seem completely unexplained unless you happen to scroll back up and notice that the bit of text that looked like "Did you intend to search for something or other" had, in fact, been "Showing search results for 'Google is awesome'. Click here to search instead for 'Obscure error message #3193'"
3. You can't click to focus any more without the world's most useless feature interrupting you.
Some idiot at Google, and I use the word "idiot" without reservation, I don't care how much effort and cleverness was involved in developing the feature, decided that people aren't interested in the content of webpages. Oh no. What they're looking for, when they do a search, is some idea of the effing color scheme of the pages that might contain the information they're looking for. And so millions were invested in creating a tool that would ensure that if a user wants to see the color scheme of any page listed in their search results, they can do so without actually visiting the page in question.
So convinced of their own cleverness were these idiots that they didn't stop there. They incorporated into Google as a mandatory search feature - you can't turn it off - and set it up so it'll be invoked if you click anywhere on a search results page that's vaguely close to a search result. When you do so, your web browser will do a little dance as it processes some Javascript that downloads a thumbnail rendering of the website in question, showing a scaled down image that's just large enough to see the color scheme, but not large enough to bother your pretty eyes with any readable content.
How can Google fix these problems
It's quite simple really. All they have to do is remove the instant preview crap, and by default search for pages containing all of the words/phrases that the user asked for.
Will they do this? Hell no.
1. If anything's obscure in your search results, Google will ignore it.
For some reason, Google are under the impression that it's more helpful to have 100,000 wrong answers, than three good ones, or even that "There's nothing like that on the web" might actually often be more helpful than pages upon pages upon pages upon pages upon pages of irrelevant, useless, links, whose lack of relevance has to be ploddingly checked one by effing one.
2. Google will change your search for no good reason
Some time ago, Google started posting, above the search results, a little note along the lines of "Did you intend to search for something or other" where something or other was your search string passed through a spell checker - or something. 98% of the time it was wrong, but occasionally something useful would come through. And then the user could click on that suggestion, and get the search results they wanted.
Not any more. Now it just automatically searches for the "corrected" version which means if you're not searching for "Brittnay speahs nood pix" but, say, the name of a product, or a code, or something else that, well, is the kind of thing you go to Google to find, you'll get pages upon pages upon pages upon pages upon pages of irrelevant, useless, links, whose lack of relevance will seem completely unexplained unless you happen to scroll back up and notice that the bit of text that looked like "Did you intend to search for something or other" had, in fact, been "Showing search results for 'Google is awesome'. Click here to search instead for 'Obscure error message #3193'"
3. You can't click to focus any more without the world's most useless feature interrupting you.
Some idiot at Google, and I use the word "idiot" without reservation, I don't care how much effort and cleverness was involved in developing the feature, decided that people aren't interested in the content of webpages. Oh no. What they're looking for, when they do a search, is some idea of the effing color scheme of the pages that might contain the information they're looking for. And so millions were invested in creating a tool that would ensure that if a user wants to see the color scheme of any page listed in their search results, they can do so without actually visiting the page in question.
So convinced of their own cleverness were these idiots that they didn't stop there. They incorporated into Google as a mandatory search feature - you can't turn it off - and set it up so it'll be invoked if you click anywhere on a search results page that's vaguely close to a search result. When you do so, your web browser will do a little dance as it processes some Javascript that downloads a thumbnail rendering of the website in question, showing a scaled down image that's just large enough to see the color scheme, but not large enough to bother your pretty eyes with any readable content.
How can Google fix these problems
It's quite simple really. All they have to do is remove the instant preview crap, and by default search for pages containing all of the words/phrases that the user asked for.
Will they do this? Hell no.
TV... this week?
It's been a while since I did a "TV this week" thing, so here's what I'm watching...
1. Leverage
This show remains awesome. It's formulaic, I admit, but it's a decent formula and it's fun.
2. Falling Skies
Not really digging it, L likes the show but I think it's slow and tedious. To be honest, I'm not digging the whole "Invading aliens" thing these days. V was bad enough, they didn't have to remake it, and the remake doesn't really grab me either.
3. Futurama
Enjoying the new series very much, it's everything I used to love about Futurama.
4. Conan
He seems somewhat tame compared to his reputation, but it's still a fun show, and actually enjoyable which I can't say about Leno. Letterman's OK but given the choice I'd rather watch something else.
5. Warehouse 13
It's not a great series, but it's better than Letterman
Looking forward to Breaking Bad this weekend.
Apparently, this coming season, they've canceled Human Target - a favorite of my wife's (we both like Guerrero...). 24 has gone (which was another "Well, it's better than Letterman" thing). It's the last ever season of House. And of course, Dollhouse and T:SCC (you already know my fixed feelings on that one...) have gone to meet their maker. Is this bad? Well, with a bit of luck something better than any of these shows will appear.
What have you been watching?
1. Leverage
This show remains awesome. It's formulaic, I admit, but it's a decent formula and it's fun.
2. Falling Skies
Not really digging it, L likes the show but I think it's slow and tedious. To be honest, I'm not digging the whole "Invading aliens" thing these days. V was bad enough, they didn't have to remake it, and the remake doesn't really grab me either.
3. Futurama
Enjoying the new series very much, it's everything I used to love about Futurama.
4. Conan
He seems somewhat tame compared to his reputation, but it's still a fun show, and actually enjoyable which I can't say about Leno. Letterman's OK but given the choice I'd rather watch something else.
5. Warehouse 13
It's not a great series, but it's better than Letterman
Looking forward to Breaking Bad this weekend.
Apparently, this coming season, they've canceled Human Target - a favorite of my wife's (we both like Guerrero...). 24 has gone (which was another "Well, it's better than Letterman" thing). It's the last ever season of House. And of course, Dollhouse and T:SCC (you already know my fixed feelings on that one...) have gone to meet their maker. Is this bad? Well, with a bit of luck something better than any of these shows will appear.
What have you been watching?
What not to cook on
We got a glass top stove as a house warming present. My wife has been wanting one for a while.
I assumed they were just as good/bad as a regular electric stove and didn't object. After all, it was going to be easier to clean, apparently, so what's not to love?
Actually it sucks. Things I hate about it:
1. It's picky about what kind of pots and pans you have
2. If you clean a pan, you have to be very careful to make sure it's dry before putting it on the "burner".
3. The temperature seems to be even less easy to control than a regular electric burner.
4. Despite the major selling point, the "easy to clean" surface, it's actually a pain to clean and there are already various permanent stains on it.
I think when I have the money I'll try to get a gas hook-up and get a proper gas cooker, like nature intended.
I assumed they were just as good/bad as a regular electric stove and didn't object. After all, it was going to be easier to clean, apparently, so what's not to love?
Actually it sucks. Things I hate about it:
1. It's picky about what kind of pots and pans you have
2. If you clean a pan, you have to be very careful to make sure it's dry before putting it on the "burner".
3. The temperature seems to be even less easy to control than a regular electric burner.
4. Despite the major selling point, the "easy to clean" surface, it's actually a pain to clean and there are already various permanent stains on it.
I think when I have the money I'll try to get a gas hook-up and get a proper gas cooker, like nature intended.
Wednesday, July 13, 2011
Stock Market #2
So I've invested in the stock market and every freakin' day my portfolio has closed down. Even today, when pretty much the entire market went up.
I'm investing long term, but even so. What's really annoying me is I can't undo some bad decisions, my employer has enough involvement in the finance industry to require its employees restrict their investments - I can't sell anything until a month after I buy it, for example.
Investment that's pissing me off: General Mills. Every report/recommendation is saying "Buy buy buy!", and yet there hasn't been a single day since I bought the thing when it hasn't dropped.
Oh well.
I'm investing long term, but even so. What's really annoying me is I can't undo some bad decisions, my employer has enough involvement in the finance industry to require its employees restrict their investments - I can't sell anything until a month after I buy it, for example.
Investment that's pissing me off: General Mills. Every report/recommendation is saying "Buy buy buy!", and yet there hasn't been a single day since I bought the thing when it hasn't dropped.
Oh well.
Sunday, July 10, 2011
Cats and cat naps
I think I've figured out why cats only sleep for twenty minutes at a time. It's that whole "curl into a ball" thing they inevitably end up in.
As they curl up, their feel get closer and closer to their noses.
Imagine the dream.
As they curl up, their feel get closer and closer to their noses.
Imagine the dream.
"I see you mouse"
The mouse froze. I can sense the terror in its eyes. It looks to the left and right trying to find a route to safety. Haha!
"You can't escape me little mouse", I think, "I know all the exits. I know everywhere you can go, and if you move, I can calculate your likely position and the thrust I need to jump on to you in a fraction of a millisecond."
The mouse looks left and right. I wait for him to make his move.
But I sense something is wrong. The mouse seems to have a glint in his eye! He squeaks at me. The bastard! He is taunting me. I prepare to leap. I no longer care if the mouse is going to move or not, I will jump on him anyway. Ha!
I prepare myself. I make my calculations. And I jump! I fly through the air, and my claws land in something soft!
Got you!
But I hear squeaking beside me. My eyes turn and I see the mouse next to me. The mouse is squeaking, he is laughing at me! The mouse is mocking me!
But what do I have? I begin to smell something. I smell cheese. Cheese! I look at my claws, and they are covered in cheese! I must have jumped on to the mouse's cheese!
The mouse is now not just squeaking, it is throwing more and more cheese at me. More and more cheese! I try to move, but my paws are stuck in the cheese, there's just so much of it! My nostrils fill with the increasingly pungent aroma.
"Squeak squeak!" teases the mouse. He runs around in front of me, and I can do nothing about it. So much cheese! It is overpowering!
I must catch that damned mouse!
I try to move forward, but I can barely move, I cannot breath with the air so thick with the cheesy smell, and my feet are so stuck in the cheese. I am desperate, I cannot catch the mouse like this! I try to breath, I can barely breath and...
...what the hell? I just woke up and my back feet are right up against my nose.
Not again!
LJ and spam
I'm actually somewhat glad I jumped ship to Blogger, as 90%+ of the comments I get at LJ are spams. As I haven't posted anything new there in a while I just changed the moderation scheme to "Friends only", so I stop getting notifications concerning the replies.
It's a shame, I like LJ on one level, but I think the whole social networking thing they tried to get into attracted the wrong element.
It's a shame, I like LJ on one level, but I think the whole social networking thing they tried to get into attracted the wrong element.
The Debt Ceiling
The Debt Ceiling is one of those things that seems entirely reasonable in theory, but in practice is utterly insane. Here's the problem.
The government is required to spend a certain amount of money. How much? That's up to Congress, which sets the budget. The executive can't reduce that amount of money unilaterally.
However, Congress also sets a "Debt limit" which means the executive may run out of money, be unable to borrow more, and find it cannot spend the money congress has told it to.
So what's the point? In practice, the only purpose the ceiling serves is to allow congress to create an artificial crisis whenever it wants. If Congress actually wants to reduce the amount of debt, or put a ceiling on it, it has always had the power to do so. The only purpose of the ceiling is to create a crisis and make it appear to be the executive's fault.
What's Obama doing about this? Answer: I don't know. Obama has ruled out taking the "constitutional option" by all accounts - basically saying "Screw you guys, you're telling me to break the law whatever happens, which by definition means your laws are unconstitutional, so I'm going to ignore the limit which appears to be the law that's the problem". Obama has a habit - public option, DADT, etc - of pretending his hands are tied when, in fact, he actually supports the outcome anyway, and his recent claim that this was a historic opportunity to cut social security makes me think that he, ultimately, wants to cut government spending.
Recently I read an article in the Washington Post which included a quote from Obama, in 2006, saying he was going to vote against an increase in the debt ceiling as a senator, which he and the democratic caucus ultimately did. While some protested this was a typical case of the MSM trying to be "balanced" using a "both sides do it" argument, the WP got this right. Yes, Obama was right that in 2006, when the economy was doing well, paying down the debt was the right approach. Virtually every mainstream, sane, economics system teaches you that in Econ 101. However, the only method to achieve this is to reduce the government's spending mandates. Obama didn't try to do that, he simply voted for something that would create a crisis.
The debt ceiling is not an effective method to reduce the debt. It does create uncertainty in the markets, and will cause lenders to demand higher interest rates for government borrowing in future, and it'll cause chaos if it's actually hit. It's a stupid idea, and it has to go.
The government is required to spend a certain amount of money. How much? That's up to Congress, which sets the budget. The executive can't reduce that amount of money unilaterally.
However, Congress also sets a "Debt limit" which means the executive may run out of money, be unable to borrow more, and find it cannot spend the money congress has told it to.
So what's the point? In practice, the only purpose the ceiling serves is to allow congress to create an artificial crisis whenever it wants. If Congress actually wants to reduce the amount of debt, or put a ceiling on it, it has always had the power to do so. The only purpose of the ceiling is to create a crisis and make it appear to be the executive's fault.
What's Obama doing about this? Answer: I don't know. Obama has ruled out taking the "constitutional option" by all accounts - basically saying "Screw you guys, you're telling me to break the law whatever happens, which by definition means your laws are unconstitutional, so I'm going to ignore the limit which appears to be the law that's the problem". Obama has a habit - public option, DADT, etc - of pretending his hands are tied when, in fact, he actually supports the outcome anyway, and his recent claim that this was a historic opportunity to cut social security makes me think that he, ultimately, wants to cut government spending.
Recently I read an article in the Washington Post which included a quote from Obama, in 2006, saying he was going to vote against an increase in the debt ceiling as a senator, which he and the democratic caucus ultimately did. While some protested this was a typical case of the MSM trying to be "balanced" using a "both sides do it" argument, the WP got this right. Yes, Obama was right that in 2006, when the economy was doing well, paying down the debt was the right approach. Virtually every mainstream, sane, economics system teaches you that in Econ 101. However, the only method to achieve this is to reduce the government's spending mandates. Obama didn't try to do that, he simply voted for something that would create a crisis.
The debt ceiling is not an effective method to reduce the debt. It does create uncertainty in the markets, and will cause lenders to demand higher interest rates for government borrowing in future, and it'll cause chaos if it's actually hit. It's a stupid idea, and it has to go.
Saturday, July 9, 2011
Investing in the stock market
This week I finally bit the bullet and opened a trading account (TD Ameritrade, in case you're wondering, but that's neither an endorsement or a criticism.)
Why invest now? Well, why not? One thing I've realized after looking at the whole thing over the last few years is there's never a "right" or "wrong" time to start investing, you just have to be careful with your strategy and not expect to make a million dollars over night. The two major strategies I'm going with are:
The problem with the economy right now is that most businesses aren't seeing demand. The lack of demand means companies are sitting on cash they don't really know what to do with. Large companies are sitting on large piles of cash, and that cash pile is growing, but they see no reason to spend more because they're selling pretty much all they make.
(This, incidentally, is why that "encourage companies to bring money back from their overseas subsidiaries" thing is not as useful as it sounds. They may physically bring the money into the US, but at best they'll simply hand it over to their shareholders. It is emphatically not going to be used to create jobs.)
Now, this means a number of things, but critically it means that investing in stocks that pay dividends right now is a good idea, because dividends are high, and will continue to be so, even if the market crashes again.
So, anyway, that's what I invested in. And I'll continue to add to the portfolio for a few years, and see what happens to it. Now's the time, especially if, as seems likely, the economy starts to nosedive like it's 1937 all over again.
Why invest now? Well, why not? One thing I've realized after looking at the whole thing over the last few years is there's never a "right" or "wrong" time to start investing, you just have to be careful with your strategy and not expect to make a million dollars over night. The two major strategies I'm going with are:
- "Averaging" - invest a fixed amount every {fixed time period} rather than looking for some magical time to invest a lot of money. Averaging is pretty much the only way to play unstable markets. It works on the basis that when the market is down a certain percentage, you lose less money than you gain when it's up a similar percentage. eg: Invest $100 - market loses half its value, you lose $50. Invest $100, market doubles in value, you gain $100.
- Dividend stocks and ETFs only
The problem with the economy right now is that most businesses aren't seeing demand. The lack of demand means companies are sitting on cash they don't really know what to do with. Large companies are sitting on large piles of cash, and that cash pile is growing, but they see no reason to spend more because they're selling pretty much all they make.
(This, incidentally, is why that "encourage companies to bring money back from their overseas subsidiaries" thing is not as useful as it sounds. They may physically bring the money into the US, but at best they'll simply hand it over to their shareholders. It is emphatically not going to be used to create jobs.)
Now, this means a number of things, but critically it means that investing in stocks that pay dividends right now is a good idea, because dividends are high, and will continue to be so, even if the market crashes again.
So, anyway, that's what I invested in. And I'll continue to add to the portfolio for a few years, and see what happens to it. Now's the time, especially if, as seems likely, the economy starts to nosedive like it's 1937 all over again.
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