Monday, November 29, 2010

Simpson-Bowles Deficit Commission has some good ideas

The National Commission on Fiscal Responsibility and Reform has come up with a lot of recommendations for reducing the deficit.

Folks are grumbling, but many of the recommendations don't seem that bad.

Here are two of their suggestions that come to mind.

Raising retirement age to 68 by 2050 and 69 by 2075. It sounds drastic, but 2075 is a long ways off. Few folks alive today will need to worry about that.

Who knows, by then the average lifespan may be a lot longer than today, assuming breakthroughs in medical science dealing with the genetics of aging.

If lifespans increase significantly, we'll have to make many adjustments to accommodate the population. Dealing with increased lifespans would mean adjusting more than just Social Security. World population explosion, for instance. Maybe we'll start building colonies in space to accommodate all the people.

Who knows, after 2050, machines might be doing most of the work. Maybe folks will already be semi retired even before retirement age.

As for dropping the home mortgage deduction, that sounds like a good idea to me. All these breaks for home buyers are supposed to make buying a house more affordable, but the opposite might be true. The incentives just push up the value of owning a home thus helping to inflate the real estate bubble and making first time home buying less affordable.

It's a good news bad news situation. The good news is, you get a tax break on interest for buying a home. The bad news is, the home is now a lot more expensive as these policies have inflated the market. For every step forward in the name of affordability, we slide back two steps due to the housing inflation these steps promote.

The mortgage interest deduction may have done us no good in the long run. Houses are just more inflated in price and the government has lost this revenue.

Today, I hear that Obama has ordered a pay freeze for federal employees. Another step that sounds okay to me. Saving some money, but also making a symbolic gesture. We've got to start somewhere if we are going to control the deficit.

Friday, November 26, 2010

Too bad so many need Black Friday

Whatcom Museum above the snow. I walked past on my way to some friends for Thanksgiving dinner.

Today is the so called "Black Friday." Think of how many things have to sell to keep the economy rolling paying for people's rents, mortgages, medical costs, education and so forth.

Here in Washington State, we are especially aware of the role sales tax plays in funding state and local government. Washington gets a high percent of its revenue from sales tax.

Wouldn't it be nice if sales didn't have to be so brisk for people to be able to pay their rents. If folks could relax and enjoy a slower sales season it might be better for the environment. Better for taking time to walk in the snow.

There's still plenty of new Ipods, TVs and so forth trading across sales counters to bring us a cornucopia barely dreamed about just 20 years ago. The products keep getting richer in technology. Many get cheaper as well. Just think how much has to be sold now, at today's low prices, just to pay the high fixed costs in today's economy, like mortgages.

Black Friday is even starting a bit early with some stores opened on Thanksgiving. Can it ever rest? Can there ever be moderation, or has the cost of living and staying in business just gotten too high? It's probably a good thing that property values are dropping.

It's not really the products that are the problem, it's the pace people have to maintain to keep up. Things like housing, health care and education need to be fed.

Tuesday, November 23, 2010

Images taken at Faerie Coffee in Bellingham

Thanks Kevyn, also sometimes known as Haggrid, for the hug at Saturday Faerie Coffee (I drink hot chocolate) which meets in Three Trees coffee shop. I'm pictured on left.

Thanks to Rick for the shirt and pants sent up from Ecuador.

Hagrid took my picture at Faerie Coffee in Bellingham around Halloween.

The pink bag is from Haggen's supermarket and says, Pink Power. My bicycle headlight made it glow at the Purple Church dance last night and I'm planning to walk the streets tonight.

Someone ask me if I planned to show it to Bellingham's favorite drag queen Betty Desire and I said "seeing her on Halloween would be like meeting the President of the United States." Halloween is a busy time for Betty. Just getting into Rumors Cabaret, where she often resides is most likely a long, long line on that day.

Surprise, Betty did make it to Faerie Coffee this late morning so I feel privileged.

I think Halloween is actually safer than Christmas and Thanksgiving. Those other days are so totally "family centered" that people travel to be with their scattered families. Auto accidents. Flying might be better, but stressful airports.

Meanwhile, Halloween has things for singles as well as families. Who ever you are, or want to be, you can stay in your own town.

There's trick or treat for families and kids. Often at malls or downtown where we trust merchants more than dwellers of our residential areas with handing out candy.

Then for adults, single, married or whatever, there's costume parties.

Hope people don't get too drunk.

I did actually see a tombstone store in Michigan that said, "Drive carefully, we can wait."

Here is another image taken of me at a local event.

Dancing and socializing at Rumors Cabaret which I do on rare occasions. The $5 we paid at the door that day benefited Whatcom County based Community Empowerment Network. A group that promotes self reliance in Brazil.

Hard to hear conversation, so I spent a lot of time on the dance floor.

It was fun.

Monday, November 22, 2010

A cold front to remember

From west window just below Nimbus on top floor of Bellingham Tower.

Every once in a while, a cold front whips through Bellingham bringing winds over 40 mph and temperatures below 20 F. I remember a real intense one in about 1988. Some years have one or two episodes of what they call the "Nor easterly." Wind down the Fraser Valley. Other years are spared. Some years we hardly get much winter.

It's too icy for my bicycling, but living near downtown allows me to walk where I need to go. Icy sidewalks. For those who ride the bus, they are still running.

I visited Nimbus in top of Bellingham Tower (Bellingham Towers, but there's only one tower). Wanted to see if building swayed in wind, but it's not really that tall, only 14 stories. Basically felt solid as a rock, but wind was howling and rattling windows. Building built in around 1928.

I had a vegetable soup.

Interesting views from the top as light snow was blowing off rooftops below.

With my heater on, my own room is now down to 46 F. I only set my heat to 600 watt setting to stay within one breaker. Electric blankets keep me warm in bed and sitting at my computer. I'm draped in an electric shawl. Looks like this year we can say we had a winter. Last year it was kind of a "non winter."

Below: Steam rising from power plant which is still operating near the old Georgia Pacific site on Bellingham's waterfront.

Friday, November 19, 2010

Demise of the white pages started in the 1980s

In 2010, I read that several phone companies are phasing out distribution for the printed versions of white pages to all their customers. White pages are still available by request, though. Most people look up phone numbers on line these days.

Another example of how the old world has been deteriorating for some time now while a new world is emerging.

Back in the heydays of Ma Bell, before the 1980s, folks got one local phone book, but the public library was full of directories from all over the country. People could look up numbers in just about any city by visiting the library. Browsing that shelf of phone directories was a window into local life across America.

Then came the 1980s and the situation started to change. Instead of getting one phone book to your home, you got several redundant phone books all with the same local listings. There were the Plaid Pages, the regular phone book and a whole stack of others. Competing directory companies all offering similar listings. Meanwhile at the library, that shelf for out of town directories started to dwindle. There wasn't money in providing directories to out of town libraries.

It took the on line world to save the day again. One can now look up out of town things without even having to go to the library and that stack of paper phone books dumped at each home is receding to history; sort of. I guess the Yellow Pages are still filling one's doorstep with redundant local directories.

Thursday, November 18, 2010

Bike touring today and in the 1960s

An MP3 player. Wonder of our modern economy. It's a radio, record player and even the record collection all in this tiny device.

I took it with me on my last bike tour. Listened through a set of headphones that only covered one ear, so other ear could be available for traffic.

A friend of mine jokingly suggested I bring a portable record player from the 1960s by Magnavox. Strap that to my bicycle. Looks like a suitcase. Speakers unlatch and swing out to the sides on hinges while the turntable tips down out of the case. It's real heavy and doesn't even include the record cabinet.

Are we economically better off than we were in the 1960s? It's kind of like comparing apples and oranges. They didn't even have mp3 players; this tiny kind of "record player" in the 1960s.

Sunday, November 14, 2010

600 billion dollars created by the Federal Reserve

Some fear this could trigger inflation, but compared to the housing bubble, I think the inflation would be relatively mild. The housing bubble was significant inflation. Just 600 billion more dollars dumped into the economy now would not likely be that significant. Part of the reason why the Fed may be taking this action is to continue trying to prop up parts of the housing bubble. The inflation has already happened and the Federal Reserve may be attempting to curb the deflation that comes after the inflation of the housing bubble.

Sunday, November 07, 2010

Some bad consequences of money flowing into a country

There is fear that nations all over the world will try and devalue their currencies. When your currency is devalued, your products are cheaper on the world market which helps your export industries. This puts your people to work and gives them purpose.

Is money now becoming a toxic asset?

When too much money flows into a country, the value of that country's currency rises. Prices rise and the country prices itself out of the world market. The country becomes a debtor nation.

What's wrong with this picture?

In the past, money was considered an asset. Money created capital investment which put people to work. Now capital puts people out of work.

I'm sure there are a lot of complex reasons why money seems to be less of an asset for putting folks to work than it was in the past. One factor is that there are so many of what used to be called "third world nations" emerging as industrial centers where the cost of living and doing business is low. Manufacturing and many service jobs, such as call centers, can move there. Then the money from this industrialization comes back to formerly wealthy nations in the form of loose money for investments.

In the past, people thought the rich nations could use their money to create higher end, high tech products and services to stay in the market. Now, even that advantage seems less viable.

Money is becoming more of a toxic substance. Money is a good tool, to a point, but it also has it's downside.

As export industries exit the rich nations, capital has less meaningful activities to invest in. It floats around causing trouble, in some cases. Money can inflate prices for real estate, for instance, pushing up the cost of living thus pushing up the cost of doing business in a country. This can push business overseas to cheaper nations.

Money can flood into politics also, creating a toxic situation. I hear that the last election, in USA 2010, had more money invested in it than any previous election. Even more than the last presidential election in spite of the fact that it was only a bi year election.

A "buy election?"

Then there's all that money flowing to Washington DC lobbyists and the toxic situations that creates.

Of course, there's also the money flowing through government that is producing many services which people still want. Police and fire protection, school teachers, health care and the like.

That money may be going to good use, though some might argue things like the military are not good use. Others might think we have too much education and health care, but not enough wisdom or health.

Much of the government money is now "borrowed money." It carries worry with it toxic worry like "can this ever be paid back?"

Part of the problem is that money is just taken too seriously. We need to step back and see how irrational it can make us. Money is a useful tool, but it can turn toxic. Money has both it's good and it's bad aspects. There's got to be more to life than just money.

Wednesday, November 03, 2010

This election is ready for the recycling bin

Click on image to see some of the slogans, or maybe you're sick of them.

If you don't like the political mood of the country, just wait a minute. It seems to change on a dime. So many contradictory interests among the people who are upset if they can't have it all; interests that are exacerbated with all that campaign rhetoric bloated in money.

It's time to dump another election into the recycling bin and just wait a few, figuratively speaking, moments. Our political climate keeps changing.

At least, for now, there's a place to recycle all that paper.

One thing we have needed for many years, and not gotten, is a bit more patience. Patience among the people and especially patience among all the special interests, which are somewhat the people's interests in disguise.

Special interests are the people's interests jacked up with money and on steroids. Special interests have been hyped, sliced and diced.

Now it's time to take all that campaign stuff and grind it back up into pulp. Make new paper.