Author: Administrator

Patriotism of people who didn’t hang up

The headline on the Rasmussen report is 41% Now Say “Buying American” Is Top Factor When Purchasing a Car. If this means that a very large proportion of auto buyers prefer to buy US-built even if it might not be the best deal,  it would indicate that many people are patriotic and willing to sacrifice for their country. That would be significant for any reformer, showing that many people are seriously committed to national welfare, and we need only find a way to connect with them.

But when we look at the details of how the survey was done, we find that:

  • It uses robocall technology, and covers only those who do not automatically hang up when receiving a robocall.  (Pollsters say they make adjustments for age, race, gender, political party, which might help overcome this limitation.)
  • It’s not limited to people likely to buy new cars in the near future, nor to people with any interest in or ability to buy any car
  • Many of the calls were made on Veterans’ Day, when some people might be in a particularly patriotic mood
  • Only 29% of the total respondents think that “buy American” means “buy a car manufactured in the United States.”

Imho the most patriotic thing Americans can do regarding new car purchases is to forego them, buy a bicycle and/or transit pass, and avoid going into debt. (Only 27% of new car buyers pay cash.)  The benefits in terms of reduced petroleum dependence outweigh anything from purchasing domestic brands.

Unfortunately, many employers choose locations which are accessible only by automobile, so not everyone has this option. If fewer of us chose to have cars, this problem might be less common.

Why Why the German Republic Fell is Hard to Find

Bruno Heilig’s 1938 essay Why the German Republic Fell is posted and freely available on the Internet. Unfortunately, the Scholars at the School of Cooperative Individualism are not the world’s greatest proofreaders, so google has some trouble finding it, but it is here.  There is also a nice abridgement here.  Hardcopy, of course, is for sale cheap at Schalkenbach.

I read this booklet about 25 years ago, didn’t remember a thing about it, but hoped it would give me some insight into how the Weimar inflation was dealt with. No such luck, it really begins after inflation had been tamed and prosperity commenced, but it’s all the more worthwhile for that.   Heilig asserts that the rise of Hitler was caused by land speculation. I am no expert in German history, but he does seem to make a good case.

Not by land speculation exclusively, of course, but land speculation as an ingredient along with:

  • public aid to large landlords, encouraging them to withhold land from use
  • privatization, on especially favorable terms to connected individuals and groups
  • failure to fully utilize farmland, resulting in unemployment as well as high food prices
  • tariffs, raising prices of consumer and industrial goods
  • public subsidies to favored enterprises
  • control of the major news media by the landed class

Land prices soared, wages fell, eventually the economy slowed, and:

Although it was obvious that the, “invariable costs” — i.e. the tribute land monopoly exacts from the working people — were eating into all production, the responsible men and the leading exponents of what was taught as economics kept their eyes, as if under some hypnotic influence, fixed upon the worker’s pay-packet.

Reformers advocated unworkable or ineffective solutions: If progress brings poverty, they urged that we retard progress.

The newspapers, of course, served the interests of their owners:

I need not explain what that propaganda organization meant in operation. Its effect was to sway public opinion into believing that the interests of the landowners were the interests of the nation. Subsidizing the landlords was the accepted policy for preserving and even saving the sources of subsistence of the people: the higher tariff walls were for the benefit of the wage-earning population: increase in land values meant increase in the national wealth: and so on…

[A]s unemployment grew, and with it poverty and the fear of poverty, so grew the influence of the Nazi Party, which was making its lavish promises to the frustrated and its violent appeal to the revenges of a populace aware of its wrongs but condemned to hear only a malignant and distorted explanation of them.

Much in this essay is similar to today, tho Heilig never uses words like “TIF” or “terrorism.”  Some things are decidely different, for example I don’t think Germany at the time had anything like a well-paid public employee class, nor a large class of small-scale investors, such as workers with 401k’s.  But it’s easy to see how today’s conditions could lead to similar results.

Georgists at the Barber Shop

Thanks to Abu Bakr Nurruddin for contriving to get us invited to The Barber Shop Show on the strange enterprise that is vocalo.org.  The audio can be streamed from here; I don’t see any way to download it tho.  Very nice folks run this show.  It’s difficult to get much economic wisdom into 20 minutes, but we expect to be invited back.

Real Congressional Reform– The Art Auble Plan

The draft report from the Fiscal Responsibility Commission, subject of my previous post, has some proposals for reform of how Congress makes (or doesn’t make) expenditure decisions.  Frankly, I do not understand them.  Perhaps this is because the draft report is simply a series of slides, not really a report.  Or maybe these things are too complex for a simpleton like me to understand.

Separately, there is apparently a proposal to cut Congresspersons’ pay, and even one to reduce their pay every year that the government runs a deficit.

But these won’t work, for a very simple reason: Continue reading Real Congressional Reform– The Art Auble Plan

Fiscal responsibility and reform

The “President’s National Committee on Fiscal Responsibility and Reform” has issued its “draft report,” actually just a series of powerpoint-like slides in pdf format, with a few complete sentences here and there.   Yves Smith [correction: These comments were guest-posted on Naked Capitalism but originate at The Daily Bail] has already posted comments, of which I fully endorse the last sentence, but I would like to expand a bit here on my own site.

Now, it would be too much to expect the President’s Commission to suggest anything that would seriously change the way the powers-that-be conduct their business.  Continue reading Fiscal responsibility and reform

Car plague and bankster plague intersect

I have long tried to avoid any dealings with the various tentacles of Chase Morgan Stanley, figuring somehow or other I would be injured by them.  Apparently, at least in Colorado, some (or all?) of their staff are exempt from prosecution for assault.  Google finds only two reports, one from the UK Daily Mail , one from the Vail Daily, local to the event.

In case these links disappear, the first three sentences from the Daily Mail story give a pretty good summary.

A financial manager for wealthy clients will not face charges for a hit-and-run because it could jeopardise his job, it has been revealed. Martin Joel Erzinger, 52, was set to face felony charges for running over a doctor who he hit from behind in his 2010 Mercedes Benz, and then speeding off. But now he will simply face two misdemeanour traffic charges from the July 3 incident in Eagle, Colorado.

And from the Daily Vail:

Erzinger, an Arrowhead homeowner, is a director in private wealth management at Morgan Stanley Smith Barney in Denver. His biography on Worth.com states that Erzinger is “dedicated to ultra high net worth individuals, their families and foundations.”

Erzinger manages more than $1 billion in assets. He would have to publicly disclose any felony charge within 30 days, according to North American Securities Dealers regulations.

The decision to drop felony charges was made by the local prosecutor, over the victim’s objections.  One infers from the articles that the Erzinger will pay some monetary restitution.

More details from the Daily Vail:

Erzinger drove all the way through Avon, the town’s roundabouts, under I-70 and stopped in the Pizza Hut parking lot where he called the Mercedes auto assistance service to report damage to his vehicle, and asked that his car be towed, records show. He did not ask for law enforcement assistance, according to court records.

Erzinger told police he was unaware he had hit Milo, court documents say….

Meanwhile another motorist, Steven Lay of Eagle, stopped to help Milo and called 911.

It appears that neither the perpetrator nor the victim is British, so it’s kind of curious why the Daily Mail covered this.  Or maybe more curious why only one paper in North America did.

ht Naked Capitalism

Are you smarter than a hedge fund trader?

As for me, I’m just a little dumber than average, among the people who undertook the Trader’s Brain Scan, a test of memory and pattern recognition skills which presumably are important to profitable trading in financial markets.  Nothing on the test about bribing Congressbeings or extracting inside information from officials. Maybe that’s in one of the other modules.

This is among a dozen tests for (actual or aspiring) investors, traders, and entrepreneurs at Marketpsych.  Free registration (giving them an email address and signing their agreement) is required, but the results appear right in your browser as well as in the emails they send, and your name is not requested.

You could invest in privilege…

…thru the Rent Seeking ETF proposed by blogger Cassandra Does Tokyo.

Companies that purchase influence, contracts, and favorable legislation/regulation are worthy of investor attention (not because they are more dynamic, which they aren’t) but because they have a definable edge – something many others cannot boast about. Of course, ETF marketers would need to sanitize the pursuit into something like “Government Partnership Focused ETF”…

Somehow she omitted land from this fund; I guess there are already ETF’s for real estate.

Corporate income tax is evil

We know that because “Don’t be evil” Google pays almost no corporate income tax.   This Bloomberg/Business Week article outlines how they do it.  It involves Dutch, Irish, and Bermudan subsidiaries, and is apparently quite legal.  In addition to playing international transfer-pricing games, of course, corporations can take advantage of various incentives and loopholes built into or discovered in the tax code.

Naturally, I am mentioning this to point out that a land value tax cannot be avoided, as long as land transaction, description, and payment records are public. (And, I might add, as long as there are some reasonably free news media, and some members of the public who pay at least a little bit of attention.) There is never any question as to which jursidiction land is in, and there is no need for incentives to attact land.