So how to end Great Depression 2.0? Pt 4

Spend less on health care. The United States spends 19% of GNP on health care. That's twice what every other country on the globe spends. We cannot afford to divert that much money from economic development. Every dollar spent on health care could have built new factories, new products, schools, roads, bridges, airports, and contributed to real economic growth.
Every US made product costs 19% more just to pay the worker's health care. Our international competitors pay half that.
Much of the health care money goes to trial lawyers, over priced drugs, expensive procedures of limited benefit, insurance company bean counters and other undesirables.

So how to end Great Depression 2.0? Pt 3

Drill baby Drill. Economies run on energy. Right now the US sends better than $1 trillion dollars abroad for oil every year. Much of the money goes to countries that don't like us very much. For instance Saudi money pays for madrassahs in Pakistan that turn out Al Quada and Taliban fighters.
The Pacific coast has huge oil reserves that have been untouched since the Santa Barbara blowout in the 1960's. The Atlantic coast hasn't even been surveyed. There is a huge field in Alaska that got designated "Alaska National Wild Life Refuge" and closed to oil drilling. We have vast tar sand reserves in Colorado. We have gigantic newly discovered domestic natural gas fields.
Developing these reserves would put a lot of people back to work. The oceans of money we send overseas would be better spent employing our own citizens to develop our own resources.
Right now an aggressive US Green movement is doing all it can to block energy development of all kinds. They point to the BP spill and claim that possible environmental damage is too great a price to pay.
I beg to differ. We have 10% of the population out of work. That's 30 million people. Being out of work is really miserable for the workers, the spouses and the children. Getting laid off is about the worst thing that can happen to a worker.
I'm willing to accept a BP sized spill every ten years or so in order to put 30 million hard pressed citizens back to work.
The oil industry is going to be super careful after the BP spill. That spill cost BP everything the company will earn over the next ten years. We have a herd of tort lawyers currently harrassing doctors. They could be retrained to sue oil companies over every spilled bucket of fuel or lube. That will learn 'em.

So how to end Great Depression 2.0? Pt 2

Gotta get the housing market running again. The banks, egged on by Fannie and Freddie, have completely screwed up the housing market to the point where no one is building new houses, no one can sell their old houses, no one can sell their new houses, and zillions of people (and their lenders) are taking a bath when they cannot pay their mortgages. Construction workers, and building tradesmen are out of work, building supply firms cannot sell their products, and appliance makers cannot sell appliances. This is a big slice of the economy, and it's flat on its back. Banks and the investors have lost so much money on home mortgages that they aren't lending to anyone.
The key to housing is credit. Nobody has enough cash to buy a house, they have to get a mortgage. The market is a disaster today because lenders gave credit to people who could not afford the house. These people are defaulting on mortgages they never should have signed. Each defaulted mortgage means another house put on the market at firesale prices, driving down the price of houses. For the average Joe, whose savings are mostly in his house, each price drop comes right out of his hide. Price drops in housing hurt more than a drop of the Dow Jones.
To tame this monster, we gotta have rules limiting mortgages to those who have the income to pay them off. To insure the rules are enforced, lenders who break the rules need to loose their money.
Right now, that doesn't happen. The mortgage market has Fannie and Freddie, who buy shaky mortgages from lenders. If the lender can sell the mortgage before the borrower stops paying on it, he is home free. And that is the major cause of Great Depression 2.0. We need to shut down Fannie and Freddie, cause they encourage disasterous loans, loans that hurt the borrower and hurt the housing market as a whole.

So how to end Great Depression 2.0?

We have a new republican house coming in a few days. We have a democratic party sufficiently scared by the 2010 election to listen to a little reason. We ought to be able to do something.
Firstly the economy is suffering from a want of demand. People just are not buying anything that they don't have to. Cars, appliances, new clothes, home repairs, lawncare, books, and a lotta other stuff doesn't have to be bought now, it can be postponed. And that's what everyone is doing, postponing the purchases of everything and anything they can. So the makers of everything and anything are cutting back production, laying people off, and sitting on their available cash, waiting for better times.
How to stimulate demand? Simple, introduce new products that people are willing to spend on. In the past, automobiles, radios, refrigerators, television, vacuum cleaners, stereos, chainsaws, power mowers, cell phones , and PC's were irresistible products that people bought, 'cause they needed them or 'cause they were cool. This has slowed in recent years. About the only guy still doing new products is Steve Jobs at Apple.
We need to get more new products going. First step would be to straighten out the Patent Office mess. Today's Patent Office grants patents on totally obvious stuff, grants patents on stuff that has been common knowledge for decades. Result, invent something that makes money and get sued. Doesn't matter much what it is, some patent troll will sue you. The Blackberry makers got ripped off for $600 million by a patent troll who had a couple of patents on totally obvious ideas.
Large companies have lawyers, and stock of their own patents, and defend them selves by countersuing. Small startups without deep pockets cannot afford these suits.
Net result, we have a patent system that discourages innovation and new product development. Not what we need to get out of Great Depression 2.0
A cleaned up patent office would go back to where it was in the 1970's. No patents on computer programs, business methods, and intangibles like file formats and communications protocols. A good patent office would put the entire backlog of patents onto a computer searchable data base on the internet for all to see. It would conduct a serious search for prior art before granting a patent, and it would solicit industry responses to all new patent claims. New patents should be only granted for things are are truly new, and advance the state of the art. Allowing patents on one click selection on a website (which is done today) merely give welfare to lawyers.

Snow Bonanza

Just went out and stuck a yardstick into the snow on the porch. 29 inches. Skiing at Cannon will be fantastic. Think about taking a day off from work and coming up skiing.
Its still falling. Weather guy thinks it might snow all day.

Words of the Weasel Pt 17

Bi-partisan (or Bipartisanship). Now that Republicans have gained control of the US house of representatives, the media has been overflowing with pitches in favor of "bipartisanship". Doesn't matter what the issue is, the right thing is the bipartisan thing.
Actually, coming from the mouths of politicians, "bipartisanship" means "vote my way".
This is not a good thing. Politicians should vote their district, or if the district doesn't care about the issue, vote in the best interests of the United States. They shouldn't vote for the other side just to be nice or bipartisan.
Laws should not be passed unless a solid majority of the voters favor them. If the country is evenly split on an issue, then we shouldn't legislate on that issue.
No politician should vote for something he or his district doesn't favor just to be "bipartisan".

Save your Dixie cups, the south will rise again

Actually, save your old Verizon phone books, 'cause the new Fairpoint phone books don't have a lot of stuff they oughta have. Like PSNH, the electric company, isn't in the Fairpoint book. When the lights go out, that's a number you need. And the Littleton Wal-Mart isn't in the Fairpoint book.
Of course Fairpoint is in, or going into bankruptcy, so they don't have money for little things like phone books.

Smart Phones fink on their owners

According to the Wall St Journal, some popular smart phone applications, (apps) transmit the owner's location, contact information, and website choices to advertising companies. In short, buying the app makes the owner vulnerable to tracking, stalking, spamming, identity theft and undercover photography.

Narnia, Voyage of the Dawn Treader

Went to see it in Lincoln this afternoon. Things are a little slow today, and we had the entire theater to ourselves. The movie is OK, but not great, just barely drawing even with the first Narnia movie. The ship Dawn Treader is wonderful, looks totally real and has the neatest cabins and decks and lookout spots. The story is down to Edmund (Skandar Kaynes) and Lucy (Georgie Read). Peter and Susan are too grownup to return to Narnia this time. Acting is quite passable. Costumes are very good, especially Lucy's. If you are a Narnia fan, you need to see it. If not, it's a decent fantasy movie, as good as the last Harry Potter.

DADT vs Uniform Code of Military Justice (UCMJ)

The UCMJ was adopted in the early 1950's and it defines gay and lesbian as "sodomy" and a court martial offense. The UCMJ is the working criminal law for all the armed services. It's an act of congress, and the executive branch cannot change it. The Clinton era Don't Ask Don't Tell did NOT change the UCMJ. Clinton figured he didn't have the votes to do that.
Don't ask Don't Tell told commanders not to snoop and gay and lesbian troops to keep it quiet. But it was still "sodomy" and a court martial offence.
Amid all the hoopla surrounding this week end's revision, I still haven't heard if Congress actually revised the UCMJ this time, throwing out the articles on sodomy. Your news media at work...

Defeat of 2000 pages of Omnibus Spending

And a good thing too. It killed $8 billion or more of pork. Compared to the $1.3 trillion in the whole package, the pork isn't all that bad, but killing it is a good thing. We also killed funding for Obamacare, another good thing. The Senate ought to approve the House "continuing resolution" today. A continuing resolution is less damaging, it says in effect "You agencies can continue operating using last years budget." This means no spending increases, a good thing. The 2000 pages of "omnibus spending" undoubtedly had all sorts of spending increases buried deep inside.
Even better, some pet Congressional spending projects like the extra engine for the F35 jet fighter may die. Or at least give in incoming Republican Congress another chance to kill them.
The other good reason for killing the omnibus spending bill was nobody really knows what is hidden in the 2000 pages. I'm sure the staffers who wrote it tucked in all sorts of things that I might not approve of.
We should never allow omnibus spending bills. We should pass one appropriation bill for each agency (Defensive, Homeland Security, Agriculture, etc). Then resulting appropriation bills will be smaller, and people have a fighting chance of reading them, understanding them and critiquing them. There are plenty of people who know the ins and out of a single government agency. Nobody knows the ins and outs of the entire US government. When you take the appropriations for the whole government, mix them together at random, omit a table of contents, and make it 2000 pages long, nobody can figure out what it means. I think such bills should be voted down just cause they empower bureaucrats to do anything they want to.

Does the Iphone add to the trade deficit?

Apple's blockbuster Iphone is made in China. Last year Apple imported $1.9 billion worth of Iphones from China. Making the US-China trade deficit worse by $1.9 billion.
But, the Chinese merely assembly the I-phones. They have to import all the parts. Of the $178.96 wholesale cost of the Iphone, China only gets 3.5% or $6.50 a phone. 6% of the cost comes from US made parts, nearly twice the value add of China. The big hitters are Japan (34%) Germany (17%) and South Korea (13%)
But the Commerce Dept just credits the full price of the Iphones to China, since that's where they come from. Nobody has the time or expertise to do a manufacturing cost breakdown of every imported manufactured product.
From a standpoint of computing the US trade deficit it probably doesn't matter. Whether you charge the Iphones all to China, of split it up by national content, it's still an import. To us, it doesn't matter all that much who the trade deficit is with, it matters that we have such a deficit.
To the Chinese it matters a good deal. The Americans are pressuring China to revalue their currency upward to reduce their trade deficit. If the Iphone costs were partly laid upon Japan, Germany and South Korea, it would help the Chinese resist American pressure.
The most interesting thing is the narrow slice of value add given to China. For that little work, I'm surprised Apple makes them in China. Better to make them at home, under Apple Corp control. It's easier to keep the quality up in your own factory. And, you keep your technology to yourself, rather than sharing it with a potential competitor.

Republicans, the party of the working man

I did a lot of door to door campaigning as a Republican candidate this fall. It got so I could make a pretty good guess about the political sentiments just by looking at the house as I walked up to knock on the door.
Manicured green lawn, a BWM or Prius in the driveway, carefully maintained house, figure a Democrat. Shaggy lawn, with a few weeds and some kids toys, a pickup truck, some do-it-yourself home repairs in progress, figure a Republican.
I did better in Bethlehem, which has a lot of residents who work for a living, than I did in Franconia, which has a lot of wealthy retired folk.

Winter's back

I got 8 inches of new snow on the porch, and it's still floating down. It's 18 degrees F (seasonable) and the sun is trying to break thru the clouds.

Tom Clancy, Dead or Alive

Clancy's latest book is out, in hardback. As a long time Tom Clancy fan, I splurged on the $28.95 hardback. It isn't as good as the previous Clancy thrillers. It's set in the "future" after Clancy's last book "Tail of the Tiger". It has a dozen protagonists and villains and the narration jumps from one to another every couple of pages. There is a "co author" and the book reads like Clancy did the outline and the co author did all the writing. Sort of like the "Op Center" books.
Proof reading must have been done by Word for Windows. It allowed "site" to pass where "sight" should have been used, "Y-turn" for "U-turn", and other oddities.
Wait for the paperback, or wait for your library to get it.

Tax Freeze has the votes in the Senate

The great tax deal of 2010 seems to be moving forward. This is the "no income tax hikes for anyone, 35% estate tax" deal that has enraged the left. There was plenty of talk about how holding taxes steady would cost $zillion in tax revenue. But to be real about it, a tax hike during Great Depression 2.0 will make the depression deeper. Holding taxes steady might make the economy perk up. And the estate tax (death tax) is a killer of small business. When the small business owner dies, the small business is required to cough up incredible amounts of cash, which it does not have. So the business is liquidated to pay the estate tax.
What has not been discussed on TV is the pork attached to the bill. Ethanol tax credits, money for windmills, and extension of 50 strange tax loopholes. Essentially Obama got many of his pet spending projects, in return to agreeing to not hike taxes on anyone. I can only hope that the cost of Obama's earmarks isn't too bad. I have never seen anyone in the news business, not even Fox, comment on the cost of Obama's goodies.

Aviation Week tribute to the Space Shuttle

No discussion of the Shuttle program is complete without mentioning the two horrible accidents, and the loss of all on board. Aviation Week feels that both accidents were caused by NASA corporate culture, a culture of "press on regardless" controlled by inexperienced and poorly educated suits.
The first accident to Challenger, where the solid rocket boosters leaked flame onto the external hydrogen tank, causing an explosion 73 seconds after liftoff, was clearly a management failure. Morton Thiokol, the maker of the solid rocket boosters, called the cape the night before the launch and expressed concerns about the low temperature. The Thiokol engineers feared that the silicone gaskets that sealed the solid booster joints would stiffen in the cold and fail to seal against combustion pressure. The Thiokol engineers had it exactly right, that's what happened and the leak of white hot flame from the booster exploded the shuttle and killed the entire crew.
NASA management, rather than postponing the launch, demanded Thiokol put their fears in writing. When the Thiokol suits demurred, NASA pressed on with the launch.
This was incredible to me. In USAF, had we received a telephone call from our engine maker expressing concern about the J75's powering our fighters, we would have believed them. We knew those engines had problems, we were used to company tech reps making light of deficiencies. Should Pratt & Whitney have volunteered information about problems, all hands, from crew chief up to wing commander would have taken it VERY seriously.
NASA management seems to be all political appointees, paper pushers with no practical experience. That can be a killer.

RGGI rides again.

According to this, money raised by the RGGI tax on electricity, which was supposed to go for virtuous greenie things, is being diverted to paying the bills.
New Hampshire's budget is opaque, but last year there was $50 million budgeted for "Greenhouse Gas Abatement". Whether it actually got spent or not is unknown, at least to me. That's a lot of money. That's 10% of this coming year's budget deficit ($600 million estimated).
The "Regional Greenhouse Gas Initiative", a joint deal involving the New England states and New York, was going to tax electric companies and earmark the revenue for "Greenhouse Gas Abatement" what ever that might mean. Which is one of the reasons we pay the highest electric bills in the nation. We get hit with 20 cents per kilowatt hour which adds up to $100 a month just to keep the lights on in a small house.
We would do better to drop the RGGI tax, drop the "Greenhouse Gas Abatement" and recover the New Hampshire Advantage.

Double Brrr

It was only 6 degrees F this morning. Coldest its been all winter.

English Muffins toast in 6 minutes, used to take 7

Trivia moment. I like my English muffins buttered and then toasted under the broiler. They come out crispier that way, than running them thru the toaster.
Several years experience showed that the muffins came out golden brown if I set the kitchen timer to exactly 7 minutes.
Last couple of days, golden brown has become dark brown with blackened edges. I've backed off to 6 minutes on the kitchen timer to recover the golden brown.
Same oven, same timer, same kitchen, same broiler. Could it be that PSNH has jacked up the voltage coming into the house? I never measured my line voltage so I'd never know if I measured it now. Line voltage anywhere between 110 and 130 is legitimate these days, and stuff that cares about line voltage has electronic regulation built into the product.
Plain old electric ranges don't care. They do run a little hotter if the line voltage is higher, but except for toasting muffins, it doesn't matter.

Nanny state gets into the real nanny business

"They" want to pass a federal law to require "safer" child car seats. "Safer" means rearward facing car seats are mandatory for children up to age FIVE. Speaking as a veteran parent, kids are gonna hate that one. Kids don't mind riding in car seats much, 'cause the seat boosts them up so they can see out the windows. Rear facing seats would retrict the kid's view to the back seat upholstery.
While "they" were at it, "they" want to require infants travel in car seats on airlines. Which would require parents to buy a ticket for infants. Right now, infants under two can travel for free sitting in a parent's lap. Many parents, including yours truly, decide that enduring transcontinental squirming is worth the savings.

Brrr

It was 12 degrees F outside this morning, and the weather folk on the radio are predicting colder for tomorrow. Furnace is working just fine, forty year old Andersen thermopane windows are still tight. An inch of snow fell last night, and the town plow went by at 6 AM to clear it.

Zap Zing Pow. Obama takes a hit, on TV

The federal tax dustup is in full view on national TV. Obama is mad, and it shows on TV. He wanted to hike taxes on the upper middle class ($250K). He didn't have the votes to make that happen. He doesn't want to impose a tax hike on the entire country, that would leave us stuck deeper in Great Depression 2.0, and everyone would blame him for that disaster. The Republicans said the only income tax they would accept is no tax hikes for anyone. And they have the votes to make that stick.
So Obama cut a deal, no tax hikes for anyone (good idea) in return for more unemployment payments (mediocre idea). Plus some other tax breaks that I don't fully understand yet, and 35% estate tax with a bigger exemption. The Republicans signed on. The Democrats are furious, they think Obama got rolled.
Obama clearly is mad at everyone. He called the Republicans "hostage takers" which is sorta dumb. After you cut a deal with someone, you don't call them names. He then proceeded to lecture his democrats on the virtues of compromise, which came across as patronizing.
Politics as a blood sport. Can be fun to watch on TV.

Estate Taxes (death taxes)

Large estates are mostly family businesses, farms, gas stations, retail stores, truck stops, dry cleaners, restaurants, homebuilders, and dealerships. The deceased's estate is pretty much the business. He may have a few thou in the checking account, a decent house and a nice car, but most of the estate is the business.
So, lets look at things from the standpoint of the business. It's been humming along, employing people, making a profit, getting by. It hasn't been growing 10% a year, its cash flow is on the tight side, but as long as the owner stays alive, it will continue being an asset to the community.
Then something bad happens and the owner dies. The business is willed to the heirs, and all of a sudden, it/they (business/heirs) is/are liable for humongous amounts of estate tax. The heirs don't have that sort of money. Neither does the business. In many cases the business is liquidated to pay the estate taxes, the employees are laid off, and the community looses a local business.
In short, the estate tax, death tax, is a killer of small businesses. Those of us who have operated small businesses know how difficult it can be to keep the doors open. That's tough. Even tougher is starting a business up from scratch. So the liquidated businesses don't grow back. When the estate tax forces them to liquidate, they stay liquidated, and the community looses the employment, the services, the taxes, and the civic support that local businesses provide.
In short, the estate tax anti small business. The really fat fat cats, like Bill Gates and Warren Buffet have foundations and pricey lawyers to keep their fortunes out of the clutches of the government. The estate tax doesn't hit the rich, it hits small business. Estate tax demands that small businesses cough up incredible amounts of money every generation and few small businesses have that sort of money.

Skip the "Dream Act". Grant US citizenship to vets

Anyone who has borne arms the the defense of the United States of America is entitled to US citizenship. I say anyone with an honorable discharge from the armed forces should be granted US citizenship, 'cause you cannot find better citizens anywhere. That "Dream Act" they are talking about sounds kinda complicated, rules about how old the kid was when his parents brought him into the country, how old he is upon discharge. And give credit for going to college, which isn't the same as serving in the military. I say just grant citizenship to all honorable discharged veterans and we will gain a lot of valuable and loyal citizens.

Let it Snow, Let it Snow

I have 8 inches on the porch and it's still coming down. Ever faithful town of Franconia plowed at 6:30 this morning and again at 11. It's light dry and fluffy, perfect for sking. Cannon will be in good shape for this coming weekend.

School Lunches

Somehow I survived public school on brown bag lunches packed by dear old mom. My children got by on brown bag lunches packed by yours truly. Two generations of my family did fine with out a school lunch program.
So, in its infinite wisdom, in a time of austerity, the Congress decided to blow an extra $4 billion dollars on the federal school lunch program, after the $12 billion already spent this year. To add insult to injury, the bill bans school bake sales, because the brownies contribute to childhood obesity. Congress has been unable to pass any appropriation bills, but it has time to blow $4 billion on school lunches. Or is it really $4 billion handout to agricultural interests?
Now with deficits in the trillions, a measley $4 billion isn't all that much. But we gotta start somewhere. Who was it that said "A billion here, a billion there and pretty soon you're talking about real money"?

Rolls Royce engine failure, followup

Aviation Week believes the catastrophic in flight engine failure suffered by the Trent 900 engine was caused by an oil leak. The engine oil leaked from a piece of tubing, pooled in the bottom of the the engine casing and caught fire. This is back in the hot section of the engine, there is plenty of heat to ignite darn near anything. The oil pipe leaks are attributed to welding flaws at the factory. The extra heat of the oil fire caused the intermediate turbine to run too hot and fail. Jet engine turbines always operate as hot as engineering dares, the hotter, the better the fuel economy. It wouldn't take much additional heat to push the turbine over the temp limits.
If true, this is good news for Rolls. They merely have to inspect all the engines for oil leaks, and replace some engine piping. The basic design of the engine appears to be OK, it just had a weak part installed. Change out those parts and problem is fixed. There should be some hearty sighs of relief coming from the Rolls engineering dept.

That Deficit Commission

They have been getting some air time on TV. They want to do a tax hike by just eliminating deductions, mortgage interest is the big one. They claim to have some spending cuts.
Question: Are these real spending cuts, or fake spending cuts? Real spending cuts happen when the agency gets less money next year than it got last year. Real spending cuts are very rare. Fake spending cuts are when the agency gets less than it asked for. This game is really old, and the agencies always ask for much more than they expect to get, on the theory that what they do get will be enough so they don't have to do layoffs.

Big all day storm, but less than an inch of snow

Yesterday was wild up here. Wind gusts strong enough to shake the house. Big trees whipping back and forth. Plastic trash cans and empty drywall mud buckets flying thru the air. Nearly as bad as the April tornado three years ago. The lights stayed on, mostly. The power would occasionally die and confuse the computer and the Bose clock radio. Trees down on the roads, Town of Franconia trucks cutting them up. The show lasted for nearly 24 hours.
For all the fury, darn little snow.

Deathly Hallows

Of course I went and saw it. I've seen the previous ones, I have the books, alledgedly purchased for the children, but I read them too when no one was looking. It's all good fun.
It's a Harry Potter movie, pretty much like the others. The cast is a year or two older than the last time. Emma Watson / Hermione is very pretty. She has an interesting face that looks lovely when photographed from the right angle, but plain photographed from the wrong angle. For most of the movie they are wearing "urban grunge" the fashion statement of the ugh-oh's (2000-2010). The two boys just look baggy and wrinkled wearing this stuff, but Emma always looks slim and elegant. Daniel Radcliffe (Harry) has grown up to be fairly handsome, more so than Rupert Grint (Ron) has. Rupert's hairstyle did nothing for his appearance. He needs to find a better barber if he wants to stay in pictures, after the last Potter movie that is.
It's long, 2 1/2 hours. Even at that length, it would be hard to follow if you hadn't read the book, and in fact read it fairly recently. It follows the book quite closely, but there is little dialog to clue the unread into what is going on.
For one reason or another, my favorite scene from the book was omitted. Hagrid and Harry are airborne, in/on a motorcycle, with Death Eaters in hot pursuit. Hagrid pushes a button on the handlebars, the cycle emits a great flash and cloud of smoke from the exhaust. Right there, in mid air, the smoke solidifies into a stout brick wall, into which the Death Eaters crash at Mach 0.5.

Giving thanks for small favors

Broadband just got broad again. I'm on a Time Warner cable modem and band width sucked. I couldn't play a U-tube video with out constant pauses waiting for more video to trickle in from the cable.
Time Warner just fixed something. UTube now plays like a champ.