"Company ships jobs over seas." Right. What actually happens is rising wages, rising health care costs, rising taxes, rising energy costs, and rising regulation raises a company's costs to the point that it ceases American production. No point in making stuff if you are loosing money on it.
To fill the market need for product, foreign competitors step in.
First make the US uncompetitive and then blame it on the American companies driven out of business. That's the Democratic way.
Friday, September 24, 2010
NH state budget according to Josiah Bartlett
Josiah Bartlett Institute is a free market think tank based in Concord. They gave a "how the NH Budget works" talk last night which I attended. The speaker was Charlie Arlinghaus and the hall was well filled.
The State budget is complex, possibly deliberately so. Much, but not all, spending comes from the "General Fund" But there are a lot of special dedicated funds like Highways and Turnpikes and Fish and Game. There is an "Education Trust Fund" which is sort of, partly, but not completely, separate from the General Fund. In actual fact the legislature can and does move money between the General Fund and the Education Trust Fund pretty much at will. And Education Trust Fund money can be used for purposes other than educational. The General Fund accounts for only 44% of state spending, the other funds kick in to supply the remaining 66%.
Then the budget is supposed to be for two years. But the funds allocated are allocated by year, so the two year budget looks a lot like two one year budgets packed into the same yellow manila envelope. Whether the legislature gets to revise the two year budget every year was not made clear.
Between the "44% budget" and the "100% budget" and the one and two year budgets there lie enormous possibilities for confusion. From now on, I will be skeptical of claims that the budget has been cut, raised, saved, spindled, stapled or mutilated. I will suspect that the advocate is comparing the two year budget with the one year budget, or the 44% budget with the 100% budget.
The State budget is complex, possibly deliberately so. Much, but not all, spending comes from the "General Fund" But there are a lot of special dedicated funds like Highways and Turnpikes and Fish and Game. There is an "Education Trust Fund" which is sort of, partly, but not completely, separate from the General Fund. In actual fact the legislature can and does move money between the General Fund and the Education Trust Fund pretty much at will. And Education Trust Fund money can be used for purposes other than educational. The General Fund accounts for only 44% of state spending, the other funds kick in to supply the remaining 66%.
Then the budget is supposed to be for two years. But the funds allocated are allocated by year, so the two year budget looks a lot like two one year budgets packed into the same yellow manila envelope. Whether the legislature gets to revise the two year budget every year was not made clear.
Between the "44% budget" and the "100% budget" and the one and two year budgets there lie enormous possibilities for confusion. From now on, I will be skeptical of claims that the budget has been cut, raised, saved, spindled, stapled or mutilated. I will suspect that the advocate is comparing the two year budget with the one year budget, or the 44% budget with the 100% budget.
Tuesday, September 21, 2010
Obama NASA policy
Read scathing critique here. The problem is simple, after the last shuttle flight, the US has no way to get astronauts into orbit. Current fix is to pay the Russians to haul our astronauts up to the International Space Station. This is distasteful, especially as it converts the ISS into a Russian space station. So long as the Russians control access to the station, they control the station.
Technical solution is straight forward. Build a spaceship to replace the shuttle.
NASA decided to start from scratch and design a brand new rocket booster and a brand new capsule. This is the high risk expensive way to do it, but doing new designs is fun. All the NASA people, who have been pushing paper for years, jumped on the chance to do actual hardware development. Actual hardware development is much more fun than pushing paper.
Instead we should purchase the rocket boosters that have been launching commercial satellites for years and build a capsule to go on top of it. Capsules, compared to Shuttle Orbiters, are simple and reliable. A simple one piece heat shield, an air tight hull, a hatch, attitude thrusters, a parachute, and a solid fuel retro rocket.
All simple off the shelf components that could be assembled and flight tested in side a year. This is cheap and dependable, unlike the Shuttle which is expensive and dangerous. In fact Shuttle retirement is happening because NASA has finally learned how dangerous and fears the PR disaster of another Shuttle crash.
The current Obama plan is to continue the "build a new launch from scratch" plan but only give it enough money to do paper studies. This avoids having to announce the end of manned US spaceflight and having to put any money into it.
Technical solution is straight forward. Build a spaceship to replace the shuttle.
NASA decided to start from scratch and design a brand new rocket booster and a brand new capsule. This is the high risk expensive way to do it, but doing new designs is fun. All the NASA people, who have been pushing paper for years, jumped on the chance to do actual hardware development. Actual hardware development is much more fun than pushing paper.
Instead we should purchase the rocket boosters that have been launching commercial satellites for years and build a capsule to go on top of it. Capsules, compared to Shuttle Orbiters, are simple and reliable. A simple one piece heat shield, an air tight hull, a hatch, attitude thrusters, a parachute, and a solid fuel retro rocket.
All simple off the shelf components that could be assembled and flight tested in side a year. This is cheap and dependable, unlike the Shuttle which is expensive and dangerous. In fact Shuttle retirement is happening because NASA has finally learned how dangerous and fears the PR disaster of another Shuttle crash.
The current Obama plan is to continue the "build a new launch from scratch" plan but only give it enough money to do paper studies. This avoids having to announce the end of manned US spaceflight and having to put any money into it.
Bugs in Blogspot?
When replying to comments on this here blog, my replies get posted twice for some reason or other. Dunno how to fix it. Sorry for the inconvenience.
Sunday, September 19, 2010
Open vs closed primarys
You must have read about unhappiness in Delaware by now. The Party's senatorial candidate, Mike Castle, got beat by the Tea Party candidate, Christine O'Donnell. Party people, Karl Rove, the loser himself, and other pundits have been wailing and gnashing their teeth claiming O'Donnell is unelectable and the dastardly Tea Party has thrown to Delaware Senate seat to the democrats.
I moved out of Delaware 40 years ago and haven't been back much since. So I have no clue as the the electability of anyone down there any more. But, if O'Donnell can win the primary she must be doing something right. The nay sayers respond that only Republicans can vote in the Delaware primary and O'Donnell is too something or other and the independents won't vote for her.
Up here in NH we have an open primary. Independents can vote in the primaries and we allow voters to switch party allegiance on election day and then switch it back on the way out the door of the polls.
Independents are important. They hold the balance of power. Most places have 40% registered democrats, 40% registered republicans and the rest independents. Who ever the independents go for, wins the election. With an open primary, the independents get a say in how conservative or how liberal the party candidates are. As a rule, independents are more middle of the road than party members. So allowing independents to vote in the primary has the effect of nominating more electable candidates.
With an open primary, NH republicans have nominated a field of good solid conservatives, people with name recognition amount the voters and honorable records of public service.
I moved out of Delaware 40 years ago and haven't been back much since. So I have no clue as the the electability of anyone down there any more. But, if O'Donnell can win the primary she must be doing something right. The nay sayers respond that only Republicans can vote in the Delaware primary and O'Donnell is too something or other and the independents won't vote for her.
Up here in NH we have an open primary. Independents can vote in the primaries and we allow voters to switch party allegiance on election day and then switch it back on the way out the door of the polls.
Independents are important. They hold the balance of power. Most places have 40% registered democrats, 40% registered republicans and the rest independents. Who ever the independents go for, wins the election. With an open primary, the independents get a say in how conservative or how liberal the party candidates are. As a rule, independents are more middle of the road than party members. So allowing independents to vote in the primary has the effect of nominating more electable candidates.
With an open primary, NH republicans have nominated a field of good solid conservatives, people with name recognition amount the voters and honorable records of public service.
Wednesday, September 15, 2010
Primary Day
I got up yesterday at 0630. Made breakfast, fed the cat, loaded the car (signs, coffee thermos, camera) and set off for the polls. Got there as the polls opened. For poll watchers we had Russ Cumbee, holding signs for Kelly Ayotte (Republican senatorial candidate) , Kathy Taylor's husband holding a sign for Kathy (my opponent in the general election) and Marsha Graham holding signs for Anne Kuster (democratic US rep) and me holding a sign for myself (republican state Rep). All poll watchers in place and on duty long before the first voters appeared. Voting was heavy for an off year primary. Franconia had about 250 ballots cast out of 1000 registered voters. Bethlehem had about the same. The republicans had serious competition for nearly every office, so more Republicans than democrats voted.
Weather was variable, sun and showers. The showers were heavy, and cold. Holding an umbrella and two signs in a high wind takes some skill, especially if you want the umbrella to survive the experience. All concerned were thankful when the polls closed at 7PM.
Results are mixed. Republicans selected Charlie Bass for US Rep, John Stephan for governor, and the senate spot is contested between Kelly Ayotte and Ovide Lamontagne. Ovide came from absolutely nowheresville to striking distance of victory in just the last couple of weeks. Talk of recount is in the air, but nothing official, yet.
Weather was variable, sun and showers. The showers were heavy, and cold. Holding an umbrella and two signs in a high wind takes some skill, especially if you want the umbrella to survive the experience. All concerned were thankful when the polls closed at 7PM.
Results are mixed. Republicans selected Charlie Bass for US Rep, John Stephan for governor, and the senate spot is contested between Kelly Ayotte and Ovide Lamontagne. Ovide came from absolutely nowheresville to striking distance of victory in just the last couple of weeks. Talk of recount is in the air, but nothing official, yet.
Monday, September 13, 2010
Basil boosts bank reserves
Since Great Depression 2.0 kicked off in '08 there has been a lot of talk about doing something about the banks. Looks like the international banking community is finally taking some action.
The subject is reserves, how much money must a bank hold in its vault to pay out withdrawals and cover losses. If a million dollar bank loan goes bad (borrower stops making payments) the bank ought to have a million dollars in reserves so it can stay in business, pay out withdrawals and even have a little money to do new loans with.
Notice that the Basil people cannot bring them selves to just post a level of reserves. That's too easy and people might understand what's going down. Instead they announce a complex mix of reserve levels which add up to 7% or maybe 10% depending upon the phase of the moon.
The issue is that banks hate holding money in the vault. They want to loan it all out to make more money. US banks have been holding about 4% reserves which is almost enough. All the real banks (except Citi) rode out the financial storms. The failures were all "near banks", brokerage houses (Lehman, Bear Stearns, Merrill Lynch), insurance companies (AIG) and mortgage makers (Countrywide), or little banks that FDIC could pay off.
The other issue is the quality of reserves. Ideally banks would hold real cash, bundles of dollar bills, neatly wrapped, in their vault. The Basil paper seems to give some leeway here. For instance, US banks can deposit their reserves with the Federal Reserve Bank and draw a bit of interest. They can buy T-bills 'cause they are as good as cash. Things get flakey from there. European banks used hold mortgage backed securities as reserves. This killed a flock of European banks when the mortgage backed securities suddenly became worthless in 07.
The Basil document is important, 'cause banking is a mobile business. Money is light and easy to ship. Banks can easily set up to do business in the country with the most lenient banking laws. Pass a Sarbanes Oxley bill and watch all the merger and acquisition business move out of New York and over to London. So we need a world wide agreement to actually do anything effective. As opposed to national regulation that merely drives banking business of of the country.
The subject is reserves, how much money must a bank hold in its vault to pay out withdrawals and cover losses. If a million dollar bank loan goes bad (borrower stops making payments) the bank ought to have a million dollars in reserves so it can stay in business, pay out withdrawals and even have a little money to do new loans with.
Notice that the Basil people cannot bring them selves to just post a level of reserves. That's too easy and people might understand what's going down. Instead they announce a complex mix of reserve levels which add up to 7% or maybe 10% depending upon the phase of the moon.
The issue is that banks hate holding money in the vault. They want to loan it all out to make more money. US banks have been holding about 4% reserves which is almost enough. All the real banks (except Citi) rode out the financial storms. The failures were all "near banks", brokerage houses (Lehman, Bear Stearns, Merrill Lynch), insurance companies (AIG) and mortgage makers (Countrywide), or little banks that FDIC could pay off.
The other issue is the quality of reserves. Ideally banks would hold real cash, bundles of dollar bills, neatly wrapped, in their vault. The Basil paper seems to give some leeway here. For instance, US banks can deposit their reserves with the Federal Reserve Bank and draw a bit of interest. They can buy T-bills 'cause they are as good as cash. Things get flakey from there. European banks used hold mortgage backed securities as reserves. This killed a flock of European banks when the mortgage backed securities suddenly became worthless in 07.
The Basil document is important, 'cause banking is a mobile business. Money is light and easy to ship. Banks can easily set up to do business in the country with the most lenient banking laws. Pass a Sarbanes Oxley bill and watch all the merger and acquisition business move out of New York and over to London. So we need a world wide agreement to actually do anything effective. As opposed to national regulation that merely drives banking business of of the country.
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