I'm voting for Bob Barr. I don't like Bob Barr because I doubt the authenticity of his libertarian credentials in light of his record as a Republican congressman. It seems like he's changed his positions on a lot of things to get this spotlight. But, then I think... what spotlight? What's he gained? There are things in this world worth selling your soul for, but being leader the Libertarian nominee for president really isn't one of them. It's not a position that brings fame, fortune, or respect. So, who knows? Maybe he really is a believer. I'm voting libertarian because they are the closest to my own philosophies, and in the areas where we diverge, I can take comfort in knowing it doesn't matter, they won't win anyway.
If I weren't voting for Barr, I'd probably be voting for Obama. I really can't think of anything I agree with him about, and during the debates I was struck by his slipperiness and evasiveness. But, last week at some event, he gave this stirring argument to some Republicans in the crowd: "You may as well vote Democrat. We can't do any worse." It was dangerously close to honesty, and, really, it is tough to see how he can possibly be worse than the present administration. Bush ran on a platform that said we wouldn't get US troops involved in nation-building. Now, we are in the most expensive and intrusive bout of nation-building you can possibly imagine. We probably spend in a month in Iraq what we spent in Somalia or Bosnia. Bush ran as a fiscal conservative, then ran up the largest budget deficits ever, doubled the national debt, and sent the tentacles of government deep into private industry first with the Drug Plan, then with the Wall Street Bank Bailout. And, finally, it's impossible to overlook the Kafkaesque turn our government has taken under Bush. This week, there was a story about prosecutors at Guantanamo dropping the charges against some of the prisoners there, because, since they were charged, the military actually had a timeline to bring them to trial soon. Dropping the charges means that they don't have to worry about deadlines for bringing them to trial but they still get to hold them prisoners anyway! Yes! Our government views not charging people with crimes as a better legal justification for jailing them than actual charges! This is evil of literary proportions.
We cannot just shrug off this wickedness.
McCain isn't Bush, but there has to be some accountability. Republicans are the primary drivers of this mess. The democrats helped too, of course. In a perfect world, they'd all be tossed out. If Americans were serious about democracy, there wouldn't be a single incumbent elected official returned to the Federal government this year. In this imperfect world, at least the Republican's should be seriously smacked down.
Obama's single virtue is that, as a senator, he hasn't done anything. Seriously, I think on his very first day in the senate, he filled out the paperwork to get his lunch room pass and business cards, then went home early. As near as I can tell, he's showed up for maybe a dozen votes, and hasn't exactly put any thought into these, just voting straight party line on any significant issue. In his legislative career, he's shown absolutely no interest at all in legislating, and I think that's actually a fine virtue for a politician to possess. With any luck, he'll bring this same work ethic to the White House and spend four years touring the country giving speeches. He'll be very popular, and when people ask four years from now what he actually accomplished, everyone will just shrug, and say, "Well, he wasn't George Bush."
I predict he'll sweep to a second term in a landslide.
Thursday, October 23, 2008
Sunday, October 12, 2008
Bad analogies
I read this in an editorial this morning:
"Perhaps passage of the rescue bill can best be compared to emergency action to save a heart attack victim. Suffer a heart attack, and you can be treated roughly in the emergency room.
Doctors can subject your body to a variety of abuses. They can shoot it full of drugs, apply electrical shock — even cut open your chest to manually massage the heart. That's all abusive to the body, and you wouldn't do if the heart was healthy — but the first goal is to get the heart beating again. The analogy fits the credit market freeze."
This wasn't the first time I've heard the analogy: variations of it have been used by the presidential candidates and I heard it yesterday on NPR from no less a luminary than Warren Buffet. All the varients boil down to this: The credit markets had a heart attack. When someone has a heart attack, you must take swift and decisive action to save the patient.
Now, I'm no economist, but as a writer, I am rather fluent with crafting analogies, and I also have a nose for analogies that stink. In this case, a far more accurate analogy would be this: The credit market is a fat man who collapses with a heart attack. The congress and the adminstration are the paramedics who rush to the scene. A large crowd has gathered to watch the dramatic rescue attempt. The paramedics stare at they dying body and shout, "This is going to be a very expensive medical bill!" They the pull out guns and demand the wallets of everyone in the crowd.
We know we are in for at least four more years of more of the same shakedowns. What may well be the biggest political crisis that the next president will have to deal with has already arisen. In response, Obama and McCain have both locked arms with George Bush and all three men endorse the same general solutions. Yeah, they all disagree on who's to blame, they squabble about what's past, but, looking forward, they all have committed to walking the same path. Voting for either man is a vote for more of the same.
Despite my personal antipathy for the man, this crisis has pushed me toward voting for Bob Barr. If I were liberal, I would vote for Ralph Nadar. Both men opposed the bailout for very different ideological reasons. People tell me I'm throwing away my vote when I support third party candidates. I say that voting for men who've mugged you and your children so openly is twisted. Voters sticking with Republicans and Democrats is (if I may form an analogy) like an abused woman standing by her man. Yeah, he beats me up now, before we're married, but I know that's just the stress he's going through. My bruises prove how much he cares! And I know, just know in my heart, that after the wedding, he'll change and be good to me.
"Perhaps passage of the rescue bill can best be compared to emergency action to save a heart attack victim. Suffer a heart attack, and you can be treated roughly in the emergency room.
Doctors can subject your body to a variety of abuses. They can shoot it full of drugs, apply electrical shock — even cut open your chest to manually massage the heart. That's all abusive to the body, and you wouldn't do if the heart was healthy — but the first goal is to get the heart beating again. The analogy fits the credit market freeze."
This wasn't the first time I've heard the analogy: variations of it have been used by the presidential candidates and I heard it yesterday on NPR from no less a luminary than Warren Buffet. All the varients boil down to this: The credit markets had a heart attack. When someone has a heart attack, you must take swift and decisive action to save the patient.
Now, I'm no economist, but as a writer, I am rather fluent with crafting analogies, and I also have a nose for analogies that stink. In this case, a far more accurate analogy would be this: The credit market is a fat man who collapses with a heart attack. The congress and the adminstration are the paramedics who rush to the scene. A large crowd has gathered to watch the dramatic rescue attempt. The paramedics stare at they dying body and shout, "This is going to be a very expensive medical bill!" They the pull out guns and demand the wallets of everyone in the crowd.
We know we are in for at least four more years of more of the same shakedowns. What may well be the biggest political crisis that the next president will have to deal with has already arisen. In response, Obama and McCain have both locked arms with George Bush and all three men endorse the same general solutions. Yeah, they all disagree on who's to blame, they squabble about what's past, but, looking forward, they all have committed to walking the same path. Voting for either man is a vote for more of the same.
Despite my personal antipathy for the man, this crisis has pushed me toward voting for Bob Barr. If I were liberal, I would vote for Ralph Nadar. Both men opposed the bailout for very different ideological reasons. People tell me I'm throwing away my vote when I support third party candidates. I say that voting for men who've mugged you and your children so openly is twisted. Voters sticking with Republicans and Democrats is (if I may form an analogy) like an abused woman standing by her man. Yeah, he beats me up now, before we're married, but I know that's just the stress he's going through. My bruises prove how much he cares! And I know, just know in my heart, that after the wedding, he'll change and be good to me.
Friday, October 10, 2008
The cats weigh in...
The cat's have noticed my compulsive towel washing and weighed in with their opinions on this morning's post.
Will things get better, or worse? Round two.
According to google analytics, one of my most popular posts to this blog came back in May when I posted an article called "Will things get better, or worse?" I looked at some of the various forces I thought might push the world closer to paradise, versus equally powerful forces I thought might push us into an apocalypse.
This morning, listening to the BBC, the trumpets of the apocalypse seem to be sounding. Financial markets around the world are in full blown panic. No matter what happens in the long term, the fact is that we are going to enter into next year with significantly less wealth in the world. So, I find myself on a rainy Friday morning looking out over the gray gloom of the day and thinking, "Is it time to fucking panic? Seriously, should I be drawing the last hundred bucks out of my 401k and go shopping for some sort of semi-automatic weapon? Maybe stock up on canned goods to better wait out the rampaging hordes of looters that may start wandering the streets any day now?"
Fortunately, any fan of science fiction knows that the wisest advice ever offered is: "DON'T PANIC!" Instead of shopping for guns, I'll spend my morning instead washing my towels. (If you aren't getting the reference here, you are dead to me.)
And now, three reasons to panic:
1. We are governed by idiots, thieves, and madmen. If you're not willing to go that far, I still think you would have a hard time arguing that any major political figure of the last twenty years has covered himself in glory. No one, either democrat or republican, has shown any willingness to tackle our economic problems in a responsible fashion. Last week's presidential debate was astonishing in it's shallowness. Both McCain and Obama, when asked if this current crisis was going to change the way they would approach the office, basically pretended not to have heard the question. No one is showing even a sliver of honesty or wisdom. Obama has chided McCain for his "erratic" behavior, but Obama, too, got behind a trillion dollar bailout bill within hours of hearing it proposed and, having impulsively decided to support it, still stands behind it. Do you know how the $700 billion figure for the initial bailout proposal was arrived at? Pure guesswork. Nothing more than a nice, round figure that Henry Paulson thought was lucky because there was a "7" in it. There were never any hearings where independent experts were invited in to propose a true cost and show the mathmatical logic of how they arrived at the cost. Instead, we're going with a number picked with the same care people bring to picking numbers on a roulette wheel.
2. The significant chunk of the world's economy was built on stupidity. About twenty years ago, someone in the banking industry realized that credit cards could be a cash cow if they gave the cards to people who wouldn't or couldn't pay them off quickly. There was a time when, if you had a credit card, it meant you were an affluent member of the monied elite who regularly made purchases of items such as diamond rings, jet planes, and small island nations. If you were a person with a million dollars in the bank, said bank would issue you a card with a credit limit of upwards of ten thousand bucks. Today, if you have a credit card, it indicates you have a pulse. You are more likely to be buying pizzas than diamond rings. Pizza! PIZZAS! There are people in this world who go into Pizza Hut and go into debt for PIZZAS!!!! YOU MORONS!!!! Get the hell out of the gene pool, now!!!!
Ahem. Excuse me. {Wipes spittle from chin.} Deep breaths. Find my happy place.
Okay. Look, I'm not coming at this from some holier than thou position. I've put some amazingly stupid charges on my own credit cards. But, credit card companies have given consumers an amazing amount of rope because it's profitable for them to have people hang themselves. Banks want people to run up large debts with no plan on how to pay them off, knowing that while most people are lousy at math, they are also fundamentally honest and 90% of people will pay their monthly minimum payments, which are designed to have the debt paid off in roughly a century. People could live as if they were making $60k a year when they were, in fact, making only $40k a year, because every year banks would send them more credit cards with $20k limits. This can't go on forever. And, when it does stop, you're going to see a lot of empty parking lots at malls and shopping centers. An entire economic model has grown up out of people spending money they don't have. Once this house of cards collapses, it will take years, even decades, to build a more sound economy.
3. Even if you don't panic, you're surrounded by people who will. Remaining calm in the middle of a frightened mob is a good formula for getting trambled to death. So, I can sit here and calmly say I will be resolute and firm and not touch my 401k in a time of panic. But, the collective panic of even 10% of the populace invested in the market is enough to slash the value of my investments by half. Last year, the stock market was at 14k. If trends hold, we're going to see it hit 7k. Whether or not I panic, my single largest asset outside my house is in freefall, and what can I do about it?
Well, one thing I can do is think of three reasons not to panic:
1. People don't like being poor. I don't think that most people in America are going to switch to a diet of beans and oatmeal any time soon. We are still going to demand our pizza and sushi. We are still going to want our televisions and cell phones and GPS navigation in our cars. And, we're willing to work to get them. The world is full of carrots that will continue to motivate people to get out of bed and go to their jobs. People who lose their jobs will find new ones. You know all those jobs that they say American's won't do any more, jobs that require an influx of a few million people a year illegally to get done? We may even start doing those jobs again. The fundamental truth is, while American's are foolish consumers, they are also highly motivated and adaptable workers. We will keep things rolling through sheer worker inertia.
2. Every sale is a buy. This one requires a little thought, but, if the stock market plunges to 7k, it's going to be because people have sold a lot of stock in a panic... and other people have bought this stock at firesale prices. Let's say a speculator bought stock in North American Widget Corporation when it sold at $200 a share. The speculator went into the stock because it had been climbing like crazy in recent years, and he thinks that since it rose from $100 a share to $200 a share in two years, in two years more years it's going to be $400 a share! Now, in the panic, NAWC stock has fallen to $100 a share and the speculator is jumping out. Someone out there is buying that stock, hopefully becaused they've looked over the balance sheets and saw that NAWC is leading manufacturer of widgets with a good reputation and a highly trained workforce. NAWC stock didn't have a price to earning ratio that supported $200 a share, but it does support $120 a share, and the new buyer just make an INVESTMENT as opposed to a gamble. Panic punishes gamblers, but creates opportunities for the financially savvy.
As for the fall in house prices, we are now going to enter a market where cautious, careful people can buy houses for their true value, or even under their true value, as opposed to buying a house on the premise that it was a lottery ticket. Cable TV was full of shows on "flipping," where people would buy an old house for $400,000, paint it and put in new appliances, then sell it two months later for $600,000. Maybe now people will return to a more fundamental approach to houses... buying them as places to live instead of places to turn a quick buck.
3. Maybe... just maybe... we'll actually learn something from all this. This is, admittedly, my shakiest proposition. But, maybe we'll come out of this downturn uniformly smarter as a nation when it comes to money. People will realize that the government isn't going to save them and will sit down and take out pen and a notebook and start writing down their expenses and their income and start making some genuine financial plans. We had two decades where we've had bubble after bubble that offered easy riches. Now, perhaps people will stop and set financial goals appropriate to their income--or, set income goals appropriate to their desires and go out and get the training they need to get what they want. We could be in for five years of intense pain, but come out of it smarter, leaner, and tougher.
Right now, I'm slightly more optimistic than pessimistic. This isn't the next great depression, just a long-needed market correction that the average person will simply tough out. Just the same... don't lose track of your towel.
This morning, listening to the BBC, the trumpets of the apocalypse seem to be sounding. Financial markets around the world are in full blown panic. No matter what happens in the long term, the fact is that we are going to enter into next year with significantly less wealth in the world. So, I find myself on a rainy Friday morning looking out over the gray gloom of the day and thinking, "Is it time to fucking panic? Seriously, should I be drawing the last hundred bucks out of my 401k and go shopping for some sort of semi-automatic weapon? Maybe stock up on canned goods to better wait out the rampaging hordes of looters that may start wandering the streets any day now?"
Fortunately, any fan of science fiction knows that the wisest advice ever offered is: "DON'T PANIC!" Instead of shopping for guns, I'll spend my morning instead washing my towels. (If you aren't getting the reference here, you are dead to me.)
And now, three reasons to panic:
1. We are governed by idiots, thieves, and madmen. If you're not willing to go that far, I still think you would have a hard time arguing that any major political figure of the last twenty years has covered himself in glory. No one, either democrat or republican, has shown any willingness to tackle our economic problems in a responsible fashion. Last week's presidential debate was astonishing in it's shallowness. Both McCain and Obama, when asked if this current crisis was going to change the way they would approach the office, basically pretended not to have heard the question. No one is showing even a sliver of honesty or wisdom. Obama has chided McCain for his "erratic" behavior, but Obama, too, got behind a trillion dollar bailout bill within hours of hearing it proposed and, having impulsively decided to support it, still stands behind it. Do you know how the $700 billion figure for the initial bailout proposal was arrived at? Pure guesswork. Nothing more than a nice, round figure that Henry Paulson thought was lucky because there was a "7" in it. There were never any hearings where independent experts were invited in to propose a true cost and show the mathmatical logic of how they arrived at the cost. Instead, we're going with a number picked with the same care people bring to picking numbers on a roulette wheel.
2. The significant chunk of the world's economy was built on stupidity. About twenty years ago, someone in the banking industry realized that credit cards could be a cash cow if they gave the cards to people who wouldn't or couldn't pay them off quickly. There was a time when, if you had a credit card, it meant you were an affluent member of the monied elite who regularly made purchases of items such as diamond rings, jet planes, and small island nations. If you were a person with a million dollars in the bank, said bank would issue you a card with a credit limit of upwards of ten thousand bucks. Today, if you have a credit card, it indicates you have a pulse. You are more likely to be buying pizzas than diamond rings. Pizza! PIZZAS! There are people in this world who go into Pizza Hut and go into debt for PIZZAS!!!! YOU MORONS!!!! Get the hell out of the gene pool, now!!!!
Ahem. Excuse me. {Wipes spittle from chin.} Deep breaths. Find my happy place.
Okay. Look, I'm not coming at this from some holier than thou position. I've put some amazingly stupid charges on my own credit cards. But, credit card companies have given consumers an amazing amount of rope because it's profitable for them to have people hang themselves. Banks want people to run up large debts with no plan on how to pay them off, knowing that while most people are lousy at math, they are also fundamentally honest and 90% of people will pay their monthly minimum payments, which are designed to have the debt paid off in roughly a century. People could live as if they were making $60k a year when they were, in fact, making only $40k a year, because every year banks would send them more credit cards with $20k limits. This can't go on forever. And, when it does stop, you're going to see a lot of empty parking lots at malls and shopping centers. An entire economic model has grown up out of people spending money they don't have. Once this house of cards collapses, it will take years, even decades, to build a more sound economy.
3. Even if you don't panic, you're surrounded by people who will. Remaining calm in the middle of a frightened mob is a good formula for getting trambled to death. So, I can sit here and calmly say I will be resolute and firm and not touch my 401k in a time of panic. But, the collective panic of even 10% of the populace invested in the market is enough to slash the value of my investments by half. Last year, the stock market was at 14k. If trends hold, we're going to see it hit 7k. Whether or not I panic, my single largest asset outside my house is in freefall, and what can I do about it?
Well, one thing I can do is think of three reasons not to panic:
1. People don't like being poor. I don't think that most people in America are going to switch to a diet of beans and oatmeal any time soon. We are still going to demand our pizza and sushi. We are still going to want our televisions and cell phones and GPS navigation in our cars. And, we're willing to work to get them. The world is full of carrots that will continue to motivate people to get out of bed and go to their jobs. People who lose their jobs will find new ones. You know all those jobs that they say American's won't do any more, jobs that require an influx of a few million people a year illegally to get done? We may even start doing those jobs again. The fundamental truth is, while American's are foolish consumers, they are also highly motivated and adaptable workers. We will keep things rolling through sheer worker inertia.
2. Every sale is a buy. This one requires a little thought, but, if the stock market plunges to 7k, it's going to be because people have sold a lot of stock in a panic... and other people have bought this stock at firesale prices. Let's say a speculator bought stock in North American Widget Corporation when it sold at $200 a share. The speculator went into the stock because it had been climbing like crazy in recent years, and he thinks that since it rose from $100 a share to $200 a share in two years, in two years more years it's going to be $400 a share! Now, in the panic, NAWC stock has fallen to $100 a share and the speculator is jumping out. Someone out there is buying that stock, hopefully becaused they've looked over the balance sheets and saw that NAWC is leading manufacturer of widgets with a good reputation and a highly trained workforce. NAWC stock didn't have a price to earning ratio that supported $200 a share, but it does support $120 a share, and the new buyer just make an INVESTMENT as opposed to a gamble. Panic punishes gamblers, but creates opportunities for the financially savvy.
As for the fall in house prices, we are now going to enter a market where cautious, careful people can buy houses for their true value, or even under their true value, as opposed to buying a house on the premise that it was a lottery ticket. Cable TV was full of shows on "flipping," where people would buy an old house for $400,000, paint it and put in new appliances, then sell it two months later for $600,000. Maybe now people will return to a more fundamental approach to houses... buying them as places to live instead of places to turn a quick buck.
3. Maybe... just maybe... we'll actually learn something from all this. This is, admittedly, my shakiest proposition. But, maybe we'll come out of this downturn uniformly smarter as a nation when it comes to money. People will realize that the government isn't going to save them and will sit down and take out pen and a notebook and start writing down their expenses and their income and start making some genuine financial plans. We had two decades where we've had bubble after bubble that offered easy riches. Now, perhaps people will stop and set financial goals appropriate to their income--or, set income goals appropriate to their desires and go out and get the training they need to get what they want. We could be in for five years of intense pain, but come out of it smarter, leaner, and tougher.
Right now, I'm slightly more optimistic than pessimistic. This isn't the next great depression, just a long-needed market correction that the average person will simply tough out. Just the same... don't lose track of your towel.
Thursday, October 09, 2008
I wonder if the check has cleared yet...
So, when the stock market fell 770 points after congress initially voted down the Wall Street Bail Out, there were dire warnings that, if it didn't pass, the market would fall to 8,000. So, we passed it... and the market fell to 9000, and 8000 is maybe two rumors and a week away. Is it too late to stop payment on that check? If 700 billion didn't stop this, what, exactly, will?
I would argue that the damage done to the markets in selling the bailout did far more damage to Wall Street than just sitting back and doing nothing. Having every politician with any real power go on TV and tell us that the next depression was around the corner if the government didn't save us has done more to lock up the economy than anything. In the debate the other night, McCain and Obama seemed to be competing to see who could offer the most frightening doomsday vision. To hear them talk, every other person in America is getting evicted, losing their jobs, and going without health care and food.
No one dares speak the truth because it sounds callous: The vast majority of homeowner's aren't in any danger of losing their house. Even if their house has lost value as the bubble collapses, most people with fixed rate or even variable rate mortgages can still afford to pay their mortgages. Second, most American's still have their jobs. Don't get me wrong: I can feel the job market tightening. Every day, I get phone calls from people asking if the company I work for is hiring, and that wasn't true a year ago. But, the job market is never zero sum. A lot of car dealerships are going to find the market for new cars getting really tight, and they'll be letting go more and more sales staff. On the flip side, I think I can safely say that if you have any mechanical skills at all, your job is pretty safe for the next few years as people spend more money on keeping their existing cars on the road. The economy is likely to be cruel to people who sell stuff, but I predict it will smile on people who actually make or fix stuff.
On the final note, health care... lord only knows. It's still a growing business in North Carolina. I keep hearing about shortages of workers in the health care industry. And, when I visited my friend Greg in the hospital last week, I didn't exactly notice many empty rooms. It's true that costs are insane, and show no end in sight.
But, have you noticed that industries that recieve money directly from government tend to have the most out of control costs? A fair amount of money is spent to ensure people go to college... and college tuition costs rise many times that of inflation in the rest of the economy. Doctors and drug companies recieve hundreds of billions from the government for medicare, and that industry's costs rise many, many times that of inflation.
Now the government is about to start pumping money into banks... and I predict the cost of banking for ordinary consumers is about to jump at breathtaking rates.
Man, I hope I'm wrong.
Sigh.
I miss capitalism.
I would argue that the damage done to the markets in selling the bailout did far more damage to Wall Street than just sitting back and doing nothing. Having every politician with any real power go on TV and tell us that the next depression was around the corner if the government didn't save us has done more to lock up the economy than anything. In the debate the other night, McCain and Obama seemed to be competing to see who could offer the most frightening doomsday vision. To hear them talk, every other person in America is getting evicted, losing their jobs, and going without health care and food.
No one dares speak the truth because it sounds callous: The vast majority of homeowner's aren't in any danger of losing their house. Even if their house has lost value as the bubble collapses, most people with fixed rate or even variable rate mortgages can still afford to pay their mortgages. Second, most American's still have their jobs. Don't get me wrong: I can feel the job market tightening. Every day, I get phone calls from people asking if the company I work for is hiring, and that wasn't true a year ago. But, the job market is never zero sum. A lot of car dealerships are going to find the market for new cars getting really tight, and they'll be letting go more and more sales staff. On the flip side, I think I can safely say that if you have any mechanical skills at all, your job is pretty safe for the next few years as people spend more money on keeping their existing cars on the road. The economy is likely to be cruel to people who sell stuff, but I predict it will smile on people who actually make or fix stuff.
On the final note, health care... lord only knows. It's still a growing business in North Carolina. I keep hearing about shortages of workers in the health care industry. And, when I visited my friend Greg in the hospital last week, I didn't exactly notice many empty rooms. It's true that costs are insane, and show no end in sight.
But, have you noticed that industries that recieve money directly from government tend to have the most out of control costs? A fair amount of money is spent to ensure people go to college... and college tuition costs rise many times that of inflation in the rest of the economy. Doctors and drug companies recieve hundreds of billions from the government for medicare, and that industry's costs rise many, many times that of inflation.
Now the government is about to start pumping money into banks... and I predict the cost of banking for ordinary consumers is about to jump at breathtaking rates.
Man, I hope I'm wrong.
Sigh.
I miss capitalism.
Friday, October 03, 2008
What I can do.
Many of my recent posts have focused on the trillion dollar mugging perpetrated today on the American public. Wall Street took the US economy hostage and demanded this money in ransom. The Democratic Congress held our arms behind our backs while the Republican administration beat us to a pulp and took our wallets. Record numbers of people protested this action; we were met with a deaf ear. I wish I thought that we could vote these crooks out, but both McCain and Obama championed this theft, and most congressmen are too gerrymandered to really pay any political price for any decision they make.
So, what can I do?
I've been protesting against high public debt for years. During these same years, I've gone into debt for a variety of legit reasons--buying a house and buying a car, for instance. But, I've also made a thousand foolish, tiny, bad choices to go into debt. I've put lunches and dinners onto a credit card, especially if I'm travelling at a SF convention or something. I figure, eh, it's tax deductable, and it's only twenty bucks here, twenty bucks there. I've also thrown some unexpected expenses on, things like dental work my insurance didn't cover, or replacing a tire that had a nail in a sidewall. All these little things add up: I currently have over $15k in credit card debt. A lot of this is old debt--after my second divorce, I had a lousy run of bad luck. I had a car die, then bought a used car that turned out to be a lemon. It seemed like every other month I was throwing another thousand onto the card as the radiator blew, and the clutch went out, egr valves died, and the starter stopped. In my house, the water heater blew up, the furnace went out, and I was paying a mortgage I couldn't afford alone. Then I moved, and was paying rent and the mortgage for months, until I sold the house for a $7k loss just to stop the bleeding. I probably run up 12k of my credit card debt during two lousy years. Yet, over five years later, it's still hanging around, because, like many people, I pay the laughable minimum payments.
I've always justified this by saying that my money situation isn't so bad. If I add up all my assets and compare it to all my debts, I'm solidly in the black. I pay all my bills without sweating, and I'm never late on anything. I've always thought that, one day, I'd finally crack down and just get rid of this debt.
That day is today. The goverment is preaching that the threat to the economy is that credit is drying up, and people can't borrow money. If the government wants me to borrow money, given the actions of the last two weeks, I can only assume it is the worst thing I can possibly do.
I've been keeping track of my budget closely since I bought my house two years ago. Right after I bought the house and spent a couple of grand renovating it, I was at the peak of my debt load as a single man: I owed roughly $86k, a figure that included my mortgage and the 401k loans I'd taken out for the downpayment, but technically owed to myself. Today, I owe just under $76k, meaning, on average, I'm paying down about 5k a year on my debts, and I've been patting myself on the back for taking my debts seriously. But, it's not enough. My new goal: $10k a year. I'm paying off my car within a year, then my credit cards, then doubling up on house payments. I'm 44. My new, firm life goal is to be debt free when I turn 50.
Seven years ago, when terrorists attacked America, the president went on television and told us all that the most patriotic thing we could do for our country was to go out and shop. In reality, for many people, this meant going out and digging themselves further into debt. No more. I know that I'm probably jinxing myself by making this public vow. The clutch on my car is probably crumbling to dust as I type. But from now on, I'm keeping my lowest interest credit card open purely for emergencies, and intend to free myself from my servitude to the corporate banks that have gotten fact on my financial sloppiness for too long.
If the banks want my damn money, they'll have to get it the old-fashioned way, by going to the government for their slice of my taxes.
So, what can I do?
I've been protesting against high public debt for years. During these same years, I've gone into debt for a variety of legit reasons--buying a house and buying a car, for instance. But, I've also made a thousand foolish, tiny, bad choices to go into debt. I've put lunches and dinners onto a credit card, especially if I'm travelling at a SF convention or something. I figure, eh, it's tax deductable, and it's only twenty bucks here, twenty bucks there. I've also thrown some unexpected expenses on, things like dental work my insurance didn't cover, or replacing a tire that had a nail in a sidewall. All these little things add up: I currently have over $15k in credit card debt. A lot of this is old debt--after my second divorce, I had a lousy run of bad luck. I had a car die, then bought a used car that turned out to be a lemon. It seemed like every other month I was throwing another thousand onto the card as the radiator blew, and the clutch went out, egr valves died, and the starter stopped. In my house, the water heater blew up, the furnace went out, and I was paying a mortgage I couldn't afford alone. Then I moved, and was paying rent and the mortgage for months, until I sold the house for a $7k loss just to stop the bleeding. I probably run up 12k of my credit card debt during two lousy years. Yet, over five years later, it's still hanging around, because, like many people, I pay the laughable minimum payments.
I've always justified this by saying that my money situation isn't so bad. If I add up all my assets and compare it to all my debts, I'm solidly in the black. I pay all my bills without sweating, and I'm never late on anything. I've always thought that, one day, I'd finally crack down and just get rid of this debt.
That day is today. The goverment is preaching that the threat to the economy is that credit is drying up, and people can't borrow money. If the government wants me to borrow money, given the actions of the last two weeks, I can only assume it is the worst thing I can possibly do.
I've been keeping track of my budget closely since I bought my house two years ago. Right after I bought the house and spent a couple of grand renovating it, I was at the peak of my debt load as a single man: I owed roughly $86k, a figure that included my mortgage and the 401k loans I'd taken out for the downpayment, but technically owed to myself. Today, I owe just under $76k, meaning, on average, I'm paying down about 5k a year on my debts, and I've been patting myself on the back for taking my debts seriously. But, it's not enough. My new goal: $10k a year. I'm paying off my car within a year, then my credit cards, then doubling up on house payments. I'm 44. My new, firm life goal is to be debt free when I turn 50.
Seven years ago, when terrorists attacked America, the president went on television and told us all that the most patriotic thing we could do for our country was to go out and shop. In reality, for many people, this meant going out and digging themselves further into debt. No more. I know that I'm probably jinxing myself by making this public vow. The clutch on my car is probably crumbling to dust as I type. But from now on, I'm keeping my lowest interest credit card open purely for emergencies, and intend to free myself from my servitude to the corporate banks that have gotten fact on my financial sloppiness for too long.
If the banks want my damn money, they'll have to get it the old-fashioned way, by going to the government for their slice of my taxes.
Thursday, October 02, 2008
Apocalypse, round two
I was suprised when congress voted down the bailout Monday. But, the bill is back, and this time it's even worse! I'm pretty much a single issue voter on the matter of the federal debt, and this new package includes 150 billion in tax cuts for businesses and high income households (in the form of raising the alternate minimum tax). The fact that 70+ senators voted for this atrocity is a testament to who they truly serve. Hint: It's not you and me.
The house republicans will instinctively salivate over tax cuts. I'm hoping that a few democrats who voted for this bill will flip to opposition, but I doubt it... I suspect there will be high torque arm-twisting.
My congressman, David Price, voted in favor of the bill Monday. I've never voted for a republican in my life (well, except once in a sheriff's race), but Price has just pushed me to vote for his opponent, William Lawson, who opposes the bailout. I'm writing to let him know this of course. If we, the public, put these crooks back in office after this robbery, we deserve our impending bankruptcy.
The house republicans will instinctively salivate over tax cuts. I'm hoping that a few democrats who voted for this bill will flip to opposition, but I doubt it... I suspect there will be high torque arm-twisting.
My congressman, David Price, voted in favor of the bill Monday. I've never voted for a republican in my life (well, except once in a sheriff's race), but Price has just pushed me to vote for his opponent, William Lawson, who opposes the bailout. I'm writing to let him know this of course. If we, the public, put these crooks back in office after this robbery, we deserve our impending bankruptcy.