Tuesday, October 31, 2006

Naples or Chicago?

In the USA we are often smug about Italy and Italian crime. Italy is depicted as the hub of the Costa Nostra, a backwards place riddled by corruption.

Aside from Sicily, the most mob-ridden and dangerously depicted city in Italy was depicted as Naples. In “The Sopranos”, when Tony wants to whack someone and leave no trail to himself, he requests some boys “direct from Naples” which is pretty much seen as a place with endless numbers of potential thugs.

This summer I went to Italy. Given that I have seen the popular perception of Italy, I was astounded when Frommers insisted that Naples was a great place to visit, with many fine shops and fabulous museums. The guide books said that parts of Naples were indeed dangerous, but overall there were many nice areas of the city and that the attractions were enough to overcome the perceptions.

I spent a couple of days in Naples and I was only able to see a small part of the city, but the part of the city that I saw did seem to be vibrant and filled with high-class stores that would not be out of place in River North here in Chicago, except that the shop owners seemed ever present and they make much of the shoes and clothes nearby instead of importing them across the ocean. The cab drivers told us to stay out of dangerous parts of town and certainly parts of it were noticeably decrepit, but overall I would recommend staying there.

Recently the violence in Naples is making news. From this article

Extra Police Sent to Fight Naples Crime Wave

Italy said on Tuesday it was sending hundreds of police reinforcements to Naples to combat a bloody crime wave that has prompted some calls for the army to be sent in to restore order.

Three more people were killed on Tuesday in and around the southern city, which is home to a branch of the Mafia, bringing to seven the number of people murdered in the area since Friday.

Interior Minister Giuliano Amato said he was sending 1,000 more police to Italy's third biggest city which, according to media reports, currently has a security force about 13,000 strong.


Many Americans would read this and feel smug. This fits right in with their perception of Italy. But let’s look at the facts…

Population
- Naples 1 million
- Chicago 2.9 million

Murders per year
- ALL OF ITALY 710 murders (2004)
- Chicago 448 (2004)

Police
- Naples 13,000
- Chicago 16,000

Note – I wish that I could find better sources for crime rates in Italy… I searched the web but came up empty – if someone has suggestions or can improve on this data please put it in the comments

If you look at the statistics, it seems more appropriate to bring the army to Chicago than to Naples. We have less police per capita and a far higher murder rate.

The sad part are that we are used to it here and it isn’t news… but we certainly shouldn't be smug about Italy. If only 3 people were killed on a summer weekend in Chicago that would be a "quiet" weekend here. Sigh...

Too Much Time on My Hands

Recently after a Bears game I took Dan over to see how Carl From Chicago spends his time. There is a Gino's East not too far from my house and they have one of those trivia games that you can play while you are waiting for your food.

As you can see, some dumb guy named "Carl" has been wasting a lot of time on this game because he has the high score at 108 million. The trick of this game is to always bet the maximum on the first 4 rounds of trivia and then you get into the "bonus" round. Every question you get right from there on out gives you more points, the faster the better.

Too bad knowledge of trivia doesn't have any other useful applications... Posted by Picasa

Monday, October 30, 2006

social security explained


I recently wrote two posts about taxes covering the AMT and tax withholding. A third element of our tax system is social security.

The table to the right shows social security costs during my earnings lifetime, from 1990 forward. During this time frame the cost of social security taxes has gone up significantly.

The annual rate for social security has gone up 90% from the period 1990 - 2007 at all wages up to the "earnings base" and it has increased 126% at two times the "earnings base".
Here is a brief primer on how the social security tax system works:

1) you have an "earnings base" component. This component increases every year. Up to this "earnings base", every dollar you make is taxed at the same rate. The earnings base started at $51,300 in 1990 and is now at $97,000 in 2007
2) this rate has 2 components - a FICA rate (social security) and a medicare rate. For the period 1990 - 2007 both of these RATES have been constant at 6.2% and 1.45%, meaning that you are paying a consolidated rate of 7.65% on every dollar from $1 up to your "earnings base" (currently $97,500 for 2007). Note that prior to 1990 this rate was considerably lower, so your parents did not pay in at this rate. If you made $97,000 and worked for a company, you would pay $7,459 in social security taxes in 2007
3) your employer pays social security taxes at the exact same rate that you pay. Thus at the "earnings base" for 2007 your employer would also be paying $7,459, for a combined total of $14,918. Don't think for one second that your employer isn't aware of these taxes and that they are not a concern to you; these taxes significantly impact the cost of hiring and are not a "free ride"
4) if you are self employed - you pay BOTH sides of social security, totalling $14,918. There are some other tax implications of this that I won't go into here that make this more complex
5) in 1994 congress passed another "stealth" tax increase - the 1.45% of the tax that is supposed to go to medicare (I say "supposed to" because really this is just general tax revenues) is no longer capped at your earnings base - it goes up to infinity. Thus for someone at 2x the earnings base, your maximum tax is $8,873 and with the employer portion (or your portion, if you are self employed) this increases to $17,745 a year using 2007 rate tables

As you retire, you receive benefits from social security, and health benefits in the form of medicare. I won't go into the details of these benefits because I don't have any direct knowledge on the topic - I am sure I will research them more as I move closer to retirement, as will all of us.

Social security revenues go into the coffers of the Federal government and are used to pay for Federal programs. An "IOU" goes into the social security trust fund as the government takes this money and spends it (not invests it) on whatever earmarks and programs that they desire. I won't go into the philosophy of everything but there is no "free lunch" - the government is spending this money today and "promising" to pay it back to you in the future, out of someone else's tax dollars. A large part of our budget deficit on all other programs today is offset by the fact that the government brings in about $200 billion dollars more on social security than it pays out each year.

Thus when you look at the totality of our tax system social security is a giant part of our current payments to the government. As an individual, you should take the time to add up:

- what you pay IN to social security and medicare
- what your employer pays IN to social security and medicare
- what you pay in local property taxes
- what you pay in local sales taxes (if applicable to your area)
- what you pay in state taxes (if applicable to your state)
- what you pay in Federal taxes (directly)
- what the company you works for pays in Federal, state, sales and local taxes

It is important that you are an educated person when it comes to taxes because without a proper understanding of taxes you will not be able to make informed financial decisions. All of these taxes, and the huge "compliance costs" of dealing with these taxes and overlapping government jurisdictions, comprise a huge burden on business that limits job and wealth creation. That is a fact.

Bum Stylin' At the Bears

The Bears used to let you carry "one last" beer from the parking lot where everyone tailgates to the door of the stadium. Recently, for whatever reason, they started cracking down, saying that they'd arrest anyone who brought a beer out of the lot towards the stadium. Lots of people disregard the sign and do it anyways, but most Bears fans are relatively law-abiding so they toss that beer before they leave the north end of the south lot.

To make things a bit easier they put a big dumpster right near the pedestrian exit. As people walk by they toss that last half-drunk beer into the bin.

In Chicago we have enterprising bums. A lot of bums (you can see 4 of them from the guy in the blue jacket on the left all the way to the guy with the hat on the right) stand by this dumpster and waylay you to give them the last half of your beer instead of throwing it away. Since this seems more efficient than "wasting" that last beer, lots of people do so and the bums end up with a myriad of half drunk beers of various (mostly US) vintages.

Good thing the crack security at Soldiers Field is all over this... Posted by Picasa

The Kennedy - Highway to Hell

Saturday, October 28, 2006

Gameday Ribs, Part 1

As a service to my loyal readers, friends and all citizens of these great United States of America, I present a multi part series on how I create one of my signature tailgating dishes, which I call Gameday Ribs. Couple these with some marinated shrimp, my famous black bean salsa and chips, beer and a Little Debbie for dessert (I don't know where the Little Debbie thing started, but it is tradition now, too) and you have one kickass tailgate.

As always, click on any photo for a larger version.

First a few words about ribs. Baby back ribs are, of course, a joke. For my Gameday Ribs you will need SPARE RIBS. There really is a difference and it is important.

Most people don't know the difference so here is a short tutorial. Imagine yourself being a pig and you are on all fours (heh). Spare ribs are the portion of your rib cage that is closest to the ground and baby back ribs are the portion of the rib cage that is closer to your....back. It is that simple. The confusion comes in when you go out to eat and restaurants interchange these and call everything "ribs". Then there are different ways to trim them - St. Louis style, Kansas City style, etc. It is all b.s. except for one thing - they are either spare or back. There are a lot of arguments about which ones are better, but to me it is a no brainer. Spare all the way. Here is a photo of what they look like in the store.














And here is the other side:















You will note that one rack cost about 7.50 and the other one about 8.50. That, friends, is a DEAL. Back ribs are usually much more expensive. Be sure to find ribs that are not discolored in any way and also avoid what are called "shiners" or ribs that have been cut too close to the bones and have bones exposed.

For my Gameday Ribs I use a technique called dry rub. The way you prepare your ribs depends on the equipment you own. If you own a smoker, you typically don't need to use a dry rub as you will have the ribs on that low smoke for 6-8 hours. I don't have a smoker so I will be baking my ribs then finishing them off on the grill.

Because this is what I am working with as far as equipment goes, this is my routine. I purchase the ribs on Friday, they marinate in the dry rub overnight Friday night, they get baked on Saturday, then are refrigerated Saturday night and then finished on the grill in the parking lot on Sunday. But I am a bit ahead of myself here. Lets backup to the dry rub that I use.

First, since you will be working, you will need vitamins and nourishment to get this job done. All the better if this nourishment for your body and mind was provided free of charge by a certain blogger who has been losing many sidebets to you on football. Below is a photo of recommended nourishment for rib preparation.



















The dry rub:














1 teaspoon cayenne
2 tablespoons white pepper
2 tablespoons black pepper
1/4 cup paprika
1.5 tablespoons garlic powder
1.5 tablespoons onion powder
1/2 cup salt
2 tablespoons brown sugar

I stole the above rub out of the newspaper a long time ago and would give credit but simply can't remember who to give the credit to.

A word here about spices. Every spice you see above cost $.99 at the store, except for the brown sugar. Salt, not pictured, is $.50 - they should almost pay you to take it out of the store. I have tried this rub with more expensive spices and it tastes exactly the same. Don't waste your money on branded spices. The only warning I have is to NOT use that paprika you have had up in your cupboards for six years. My mantra is to always use fresh, cheap spices.

Preparing the dry rub utilizes a very complex technique called MIX. Pour all above ingredients into a bowl and mix. You will get something that looks like this.














I usually don't dicker with the ingredient ratios when cooking for my regular tailgating crew. Someday when my wife and kids go out of town I will try to make the ribs jacking up the cayenne and brown sugar. If you like more of any one ingredient, for gods sake add more!

Set the rub aside for now as it is time for nourishment. Part two will deal with trimming the ribs.

Friday, October 27, 2006

Not A Problem for Chicago

Posted by Picasa In Chicago there are a lot of things that incite our city council to take "action". Fois gras, as an example. And of course WalMart attempting to build a store within city limits, which brings in jobs and tax revenues, is a "bad" thing, too.

But here in River North you have something wholesome, appropriate and not a problem for the City of Chicago. The crew that shows the ubiquitous "Girls Gone Wild" videos broadcast on late night TV, who pled guilty to sexual exploitation, are coming to celebrate the glory of "pimpin" right here. No need to ban this, of course.

I get as much a kick out of "Pimp My Ride" as the next guy but really, the glorification of the Pimp isn't too funny in Chicago as it might be in some suburb where prostitution is effectively underground. Prostitutes plied their trade in the open in Bucktown / Wicker Park until just a few years ago, and now they have moved on and are making lives miserable in other neighborhoods.

But, since this neighborhood can harbor "naked sushi" without batting an eye, I guess a little bare breasts and glorification of the pimp shouldn't make much of a difference.

Madison Good, Madison Bad















I bag on the City of Madison occasionally for their crazy policies and all bagging is well deserved. But one of the things I like about Madison is that you can drive ten minutes in basically any direction and you are literally in the middle of a field. I got behind this vehicle on my way home last night carrying huges bales of hay - in the middle of rush hour, on one of the busiest streets in Madison.

If the breeze is coming from the south, I can at times smell manure at my house - usually only after they have spread in the fields. The smell doesn't bother me as I don't get it too much, but occasionally it is a nice change. Yes, you heard that right, I like to smell a farm once in a while.

Back to bagging on Madison. If you are anywhere near here this weekend I have a very good recommendation for you. STAY AWAY FROM STATE STREET. It is Halloween weekend. Usually there are a lot of people down there and we are famous here in Madison for trashing that area after the bars close. But this year we have another variable. City planning - the very worst variable of all.

First, they were stupid to schedule a football game (which I will be attending, by the way) on Halloween weekend. You really have not seen people DRINK until you have been to a Badger game and participated in the pre and post game festivities. So everyone will be drunk. By 4pm. So there will be a lot of time for everyone to get their costumes on (if they weren't already) and get MORE drunk for the evening festivities.

The city council and mayor are tired of all the kids trashing the State Street area year after year so this year they are fencing off the whole street and surrounding areas (several square miles) and charging admission to get in. They have printed 80,000 tickets - they have sold somewhere around 5 or 10 thousand. I will let you do the math.

Here is the official city site that explains the dumb plan if you are interested.

This is the most astoundingly stupid, crazy plan I have ever laid my eyes on. They should just let the bars stay open all night, and let everyone peter themselves out. Instead, they all close AT EXACTLY THE SAME TIME and then everyone pours out on the street. Oh, by the way, they are fencing off State Street beginning at 7.30! So everyone can have time to go from the football game and get in there WITHOUT PAYING ADMISSION. It is only a half hour walk or so from the stadium to State Street, if you walk slowly.

I just cannot believe that anyone would look at this plan and say to themselves - boy this really solves our problem! Look for Madison on your newscasts Sunday. Hopefully nobody will die, but I really think this year people will.

Wednesday, October 25, 2006

Un-needed Complication

I am pretty cheap with cars... still driving an old Nissan Altima. Recently I was down in Arizona and I rented a car and they had a high end Infiniti on the lot at Alamo so I decided to try one out and pay the extra daily rate.

The car was great! It accelerated well and was like a mobile living room.

One thing, though... what is up with the push button start? What is the advantage of that over a key? Originally I thought that if you didn't lock the car then someone could just push the button and drive away but then I actually read the instructions (yes, the car was so complicated you need to READ THE MANUAL) and I realized that the car only starts if the key fob is in the proximity of the starter.

Of course, the guy who was the valet knew what to do, people have been driving these for years, I guess. People who don't drive old Nissan Altimas, that is.

But really, was turning a key too much trouble? What is gained by all this? Posted by Picasa

An existentialist sign

From a recent trip I took...

Is this sign showing someone at night ruminating over the existence of God?

Or perhaps Dan thinking rather than sleeping?

I don't know... Posted by Picasa

Tuesday, October 24, 2006

The Daily Grind

Monday, October 23, 2006

Tax Withholding

I am a semi-expert on taxes. One of the topics that I see a lot of people screw up is the concept of “tax withholding”.

Everyone who works for a big company fills out a W4 form which asks them for their marriage status and number of dependents. This is commonly referred to as the “tax withholding” document.

What is this document attempting to do? Based on these selections, your company takes your salary, and on every pay check, they do a quick “mini tax calculation” using your marriage status (married or single) and number of dependents to estimate how much tax you “owe” on your salary, and then they send this amount of dollars off to the Federal and State governments.

This calculation is a pretty crude analysis; it doesn’t take into account any non-salary income you might have (such as for dividends or a small business, or interest income) and can’t really even take into account items like your annual bonus (if it comes in one check) or the impact of 401(k) deductions (which reduce gross income). A lot of companies are pretty smart about this, so when you get a bonus they just apply withholding at a flat rate rather than assume your pay is 12 times your bonus (i.e. if you were paid monthly). This calculation has also gotten easier because there are fewer tax brackets; it was more complicated when the marginal tax rate was above 50%!

Since I have some other income I always fill out “single, zero” for status and dependents. This way the end deduction for salaries is closer to what I really owe as a portion of my salary to the government.

Some tax evader types may say they are married and have a lot of dependents (9). This way the calculations done by the company result in a much lower liability. This may occur even if the person is single with no dependents! I don’t know if this is legal or not, I suspect it is, because….

TAX WITHHOLDING DOES NOT EQUAL TAX LIABILITY

Like tripping over the AMT, a vast proportion of America is confused by the concept of tax withholding and they confuse it with tax liability. Tax liability is what you OWE the government; it can only be calculated when you take into account all of your salary and all of your deductions and filing status for the entire year, and this goes beyond your salary at work. Tax withholding is what has been delivered to the government so far during the year as a “down payment” towards your tax liability.

One company I worked at had a generally available options plan and you should have seen the screaming among the rank and file over how the tax withholding was calculated. Like the big bonus check and how it screws up the calculation of the mini tax statement, these people were spitting blood over the withholding and how it was done and how high the rate seemed (to them). It was a big meeting and I didn’t have the heart to just blow the discussion wide open and say “It doesn’t matter how much they withhold, you dopes! It is the tax LIABILITY, not the WITHHOLDING!”

If you are withheld more than you actually owed, when you file your tax return this gets factored in and you receive a refund. Thus it all comes around in the end.

There is a school of thought that you should always “owe” the government at the end of the year; the rationale for this is that a tax refund is just “your money back” (which it is) and you could have earned money (interest) on that amount, which you didn’t because the government doesn’t pay any interest. There is some mathematical merit to this argument, but not a ton, let’s do some math:

- let’s say you get a refund of $3000
- and interest rates are 5% (generous), which works out to an after tax rate of maybe 3%
- If you get back $3000 at the end of the year, your average balance during the year would be $1500
- Thus your lost “true” after tax income is $1500 times 3% or about $45, not too much in the grand scheme of life

On the other hand, particularly among lower income workers, the tax refund is in effect a “forced savings vehicle” where they get a big chunk of money (to them) all at once that they can use as a down payment on a car or a house. Since often they would lack the discipline to do this on their own, it may be the only way for them to save a decent percentage of their salaries.

For the more well-off, there is a third dimension to this analysis; the government in its wisdom makes you send in quarterly checks to ensure that you have withheld at least the bulk of what you owe; else you owe a penalty. The minimum that you need to send is based on either your prior year tax liability or a portion of what you eventually owe even after all the calculations are done. In this case it is better to withhold more and get your money back (even forgoing the interest as calculated above) rather than to owe penalties.

Rich people often get a deferral and don’t file their taxes on April 15; they file on August 15. The government really doesn’t care all that much because they assume that you have already paid what you owe in taxes or perhaps even more; thus the purpose of the tax filing is really to reconcile what you owe vs. what you had withheld (or paid directly to the government).

This is why some (honest) people can go for years and years without filing a tax return; they are having taxes withheld and they are roughly in synch with what they owe (or they are due a net refund) so from the governments’ perspective, it all washes out. This is not advisable from a financial standpoint; you should file and get the money back, but for some people filing taxes is very traumatic, for one reason or another, and they don’t have the sense to hire a professional tax preparer.

Left unsaid in all this, of course, is that if the government went away from withholding and made people pay their taxes directly there would be a revolution; if you wrote a check to the government for all that money people would flip out. Entrepreneurs and small business owners (who have to pay their taxes quarterly rather than having a company withhold the money) are often the most bitter on taxes. It can be safely said that tax withholding enabled the government to grow into the monster that it has become today.

I Can Predict the Future

Yes, you read that title right. I can predict the future. I do it all the time.

The last time I did it had to do with a post yesterday by Ann Althouse. She takes Glenn Greenwald (no, I will not link him for reasons to follow) to task for his terrible writing. She's right. Look at this sentence she highlights from Greenwalds post:


Yesteryday [sic], I wrote a post pointing out that the hordes of right-wing pundits condemning the Larry Craig outing have no standing to voice such complaints, since the very tactic that they were purporting to condemn (publicizing innuendo about private sexual behavior and exploiting sexual morality for political gain) is one which their political movement has used repeatedly, over and over, as one of its central weapons. I cited countless examples -- including some from this week, along with others throughout the last 15 years -- which demonstrate that the right-wing of the Republican Party centrally relies upon tactics indistinguishable from the Craig outing, and that unlike the Craig outing (engineered by a single, obscure individual), the entire right-wing political movement traffics continuously in those tactics.

Look what Althouse says next:


That's atrocious writing. Edit, you idiot. Absurdly, his next line begins "As was painfully clear to anyone who can read..." Well, Glenn, it is painful to read your prose, and anyone who can read and has any taste at all will turn away in disgust at writing like that.
Now THAT is good comedy. I think I laughed at those last three sentences for about five minutes. She it totally on point though. Greenwalds writing is brutal as the example she provides proves.

I have been reading Ann's blog for a few years now. It is one of my very few daily reads because she writes about a lot of things I am interested in. Her blog is written clearly and concisely. I don't have all day when perusing a blog to get the point. I don't sit down to read "War and Peace". I just want to be entertained and possibly educated for a few minutes. I dare you to try to read the whole column that Althouse is referencing and not tear out your hair.

Of course, Althouse is totally correct in her post about Greenwald's writing.

My opinion: Greenwald is a boob, his writing sucks and the people who hang out there (30k per day according to his sitemeter) are idiots.

I honestly think Althouse made a boo boo posting this the way she did.

She should have CLOSED THE COMMENTS.

Here is where my predictive powers come in. As I sat with my cup of fine Sumatran reading Althouse's post yesterday morning I predicted that the comments would turn into something like this:

And Voila! The prediction doth cometh to pass.

Yep, Ann's now got her own little "la Tomitina" festival on her hands in the comments. Her regular commenters are drowned out by the shouting hordes of idiots from Greenwalds site. She is approaching 200 comments already and that was a SUNDAY post. Just wait until all of the normal weekday crowd sees the fight in progress.

This is why it is a rare occasion indeed that I will wade into the cesspool that isn't the right or left but the IDIOT cesspool. What good would it do me to debate a dolt like Paul Krugman or Frank Rich or Pat Robertson? None! Zero! Waste of time!

If you read that comment thread over at Althouse you will see that as happens so often the original post is being totally and completely ignored at this point and that it is a commenter war, not a comment thread talking about the original post. I really hope Ann closes comment threads occasionally so she has more time to write her normally high quality items and spends less time sorting out the mess in her comments.

At times I am very happy that our traffic at this blog is fairly low. These types of problems (idiots) are ones I can use right now like a hole in the head.

Sunday, October 22, 2006

The Alternative Minimum Tax

ABOUT THE AMT

I was talking with a close acquaintance who has a CPA and a background in finance. He had fallen behind in his tax preparation work and had just completed all the information needed for his tax return, including the complexities of accounting for his wife’s small business. He was talking about the various deductions, exemptions, etc… that he received and then I told him that he was wrong about most everything. Why was he wrong?

It was because of the AMT.

What is the AMT? The AMT stands for the “Alternative Minimum Tax”. It runs in parallel to the current Federal tax code. After you calculate your standard tax liability (what you owe), you also run the AMT calculations, and then if the AMT amount is HIGHER, then the higher number becomes your new tax liability.

You never win with the AMT.

The background on the AMT is that in the past there were many rich people who used various loopholes, tax shelters and tax strategies to minimize to their taxes to the extent that they didn’t owe any money. Note that this was a prodigious feat; in the past tax rates were much higher than they are today.

Thus for the AMT they started with a much simpler model – they basically took your gross income (not your net income) which is relatively straightforward for most individuals (i.e. how much cash you brought in), picked a lower tax rate than the Federal “standard” rate, applied a (very) few deductions, and recalculated your tax liability. If this number was higher, you pay the higher amount (the AMT amount).

The following AMT example is simplified but pretty close for most people:

- take your gross income (from your W2)
- use the AMT exemption
- you get a deduction for mortgage interest
- there are a few other deductions, mostly minor
- multiply it by the AMT rates
- voila! Calculate your AMT liability

The AMT is toxic because 1) they don’t “index” the brackets for inflation, which means that every year your income goes up, the cost of living goes up, but the tax brackets stay the same 2) the AMT also does not allow you to deduct state and local taxes nor property taxes, which is a huge hit on people in high tax states like New York and California. It can even trap people in states like Illinois, which have a 3% state rate and high property taxes. Wikipedia has a decent summary of the AMT here.

There are myriad other deductions and exemptions that don’t make it over to the AMT; but the 2 killers are the non-indexed brackets and the inability to deduct state and local taxes. These two items pull more and more people into the AMT world every year.

Those people, like my close acquaintance CPA, don’t understand (at first glance) that they are getting “cheated” of deductions. This is due to the fact that the tax software everyone uses nowadays STARTS with the Federal liability and calculates AMT at the end; to the developers’ credit, this is the way that the tax form calculates it, too, so they are just following along.

Thus you type in all these great deductions that the Federal tax code provides and your software cheerily calculates your tax liability; but you never really see the machinery grinding (in parallel) that is stuffing you into the AMT.

From a high level perspective, once you are “Stuck” in the AMT jail you are living there forever, even though theoretically you could “back out’ of the AMT and go to the regular code; this would mostly happen because you retired or suffered a major fall in income.

If you KNEW that you were going to be eligible for the AMT, your tax return preparation would be much faster; gross income, a couple of deductions, and you would instantly know how much you owed. If you paid AMT in the past, this is how you SHOULD think of your tax liability, because it is how it will be calculated, in the end.

How can you tell if you are in the AMT? Easy. Look at your last tax return. See if your AMT liability was higher than your regular liability. If so, then you are an AMT taxpayer, and are very likely to remain so for the foreseeable future.

WHY THE AMT MATTERS

If you go back to the first line of this post, you can see that I am bickering over the AMT and its impact on tax liability with a CPA. The formula and impact of the AMT aren’t readily known, even among (some) financial professionals.

The AMT also confuses everyone because it is on the “end” of the tax return, like it was “tacked on” as an afterthought. In reality, this tail is wagging the overall dog.

Let’s assume as a given that the average person, even a pretty educated one, doesn’t really understand the AMT, and that once you are in the AMT “penalty box” all those pretty deductions on the Federal form don’t matter at all. Why should this matter?

It matters because if you don’t understand the AMT, you are probably operating under some bad assumptions for tax and financial policy.

Think of a home, for example. Pretty much everyone takes the cost of mortgage plus taxes to calculate the “after tax” cost of a home, and then compares this against the cost of renting. But if you are in the AMT, this calculation is incorrect, because property taxes are not deductible.

Not only are property taxes not deductible, unlike other areas of your mortgage, you can’t renegotiate property taxes or fix them over the 30 year life of the loan; they are out of your control and inexorably GO UP.

Thus with your home purchases you are wrong twice; you are starting with the wrong metric on your rent / buy decision, and then you aren’t taking into account the fact that this equation will continue to worsen as long as you own your house because property taxes are generally going UP, UP, UP.

THE TAX CODE IS MEANT TO IMPACT BEHAVIOR

Even though I am not in favor of it, clearly the tax code is meant to “encourage” some kinds of behavior through deductions (like owning a house or making gifts to charitable institutions) and “punish” other kinds of behavior through higher rates or non-deductibility (like “sin” taxes on alcohol and cigarettes).

You will hear politicians trumped their latest “tax cut” or a “break for working families” for education credits, deductions, etc….

However, most of these signals (which don’t work well too begin with) are completely lost when you are on the AMT. The AMT has few deductions and they are pretty clearly laid out; there isn’t a lot to tinker with here. You can change the rate or exemption and while this reduces (or increases) the overall tax liability, it doesn’t really impact behavior (except at the highest level) and doesn’t induce specific behaviors.

However, the public debate on this topic is very muted. People don’t like the tax code nor understand it in the first place; the fact that the AMT is “tacked on” to the rest of the code makes it even less accessible. And I haven’t seen very many articles at all about the impact of the growing mass of AMT payers on 1) real estate 2) public policy.

A FINAL NAIL IN THE COFFIN; OR A SAVIOR (OF SORTS)

The US tax system is already a tottering, schizophrenic beast. Don’t get me wrong; the rise of information technology and the continued use of “withholding” where the government takes your money FIRST without (most) people even realizing it, makes the IRS an effective tax collector. Revenues are at an all-time high.

Note that I always get a chuckle out of financial advisors such as Suze Orman (who generally gives decent advice) because they always repeat “pay yourself first” like a mantra… but it is really the government that is best at this tactic.

But as far as the philosophical underpinnings of the tax code, it has never been in worse shape. Local (property taxes), state and federal taxes are all swinging around wildly, without a coherent framework. The only thing that all of these policies agree on is that they need to extract a large amount of money from working citizens to pay for the “services” that they provide with armies of slow moving “workers”; and in this measure they are ruthlessly effective.

However, this works in a police state, but can’t hold on forever in a democracy. The inconsistencies of these polices are too great; some politicians are going to go in and use this as a negotiation or “wedge” issue and exploit it.

There are three answers, and I am ranking them from best to worse as far as the country. The options are:

1) “fix” the problem with some sort of a flat tax (I am ruling out the “Value Added Tax” or VAT as it exists in Europe)
2) Use the AMT as a sort of “retarded stepson” of the flat tax, since it is (mostly) a flat tax with just a couple of deductions (mortgage interest). Under the AMT poor people don’t have to go through the hassle of filing; pretty much everyone under $50,000 or so doesn't have to file
3) Leave everything as is, or just keep muddling along with band-aid, incompatible incentives and costs (the current system)

I’d accept 2) as better than 3).

Remember, once you are in the AMT, you are (mostly) always in the AMT, so don’t make bad calculations on your personal finances. And when politicians talk about the latest “tax cut”, it probably doesn’t apply to you, tell them they are lying. And tell your realtor that they are wrong when they tout the financial advantages of owning a home, at least if they throw in the deductibility of property taxes, they are lying, too.

Friday, October 20, 2006

Thinking About Business

Every fall I travel for business and it gives me the opportunity to actually sit and think for a while, without the normal people and things tugging at my sleeves for attention. The thing I have been thinking about lately is different business models, and the way they attack their markets - or ignore them.

I fly probably between three and five times a year on average. I don't want to go into airline horror stories because we all have them and they get boring because they are just a routine part of what the airlines do. What I am interested in when it comes to airlines is the fact that they simply don't care if I ever return for repeat business - because I don't fly that often, I would assume. After living this long I am finally starting to realize that this is on purpose.

Others have shared their airline horror stories with me and am shocked when I tell them that they should just drive, or be prepared to take their lumps with crappy service. The money that you pay to an airline doesn't entitle you to squat. No service, no cleanliness, no timely delivery, nothing. Just transport from point A to point B. But if you are paying a premium, i.e. first class, you are entitled to a little something. Perhaps better seats, food, whatever - maybe a favor if you miss a connecting flight. I am not sure if it is an American thing, or just a people thing but folks who are actually offended when they don't get cadillac service after they pay $200 for a ticket to wherever probably think they are OWED the best service wherever they go. Just my thinking out loud here.

Another example - grocery stores. We have several, of course, here in Madison. One chain in particular has gargantuan facilities with a huge variety of products - cheap. And it is a dump. Others, like Whole Foods are sparkling with outrageous prices. Others are nice, have decent products with modern remodeled facilities but are priced in the middle. Typically we shop at the place in the middle.

I find it interesting that all three market some of the same products - not all, of course - but to three totally different market segments. In this respect, are all three competitors? Sure all three are grocers but if they are marketing different segments of the population do they really compete? Does Whole Foods care about the poor single mother of three that needs cheap milk? Does the low end supermarket care about a possible US import ban of designer bleu cheese from France? I think not in both cases.

Of course all of this brings me back to my business. There are many heating and air conditioning contractors that we do very little business with. Of course they are buying from my competitors. But are we really competing if it is a customer who I choose not to do business with? I recently toured one of my manufacturers facilities in Houston and was conversing with the director of national sales. He said if a competitor and myself are delivering the same product to different customers, we really aren't competitors. We are simply businesses selling the same product to different customer classes.

I want the good customers. The ones with shiny floors, clean vans, decent people to talk to on the phone, who pay their bill in a timely fashion with few returns and who, in turn, sell their products at a premium to a higher class of customer.

Ah, wisdom.

Thursday, October 19, 2006

Saturday night

This weekend I am going to be out of town but I thought I'd show the usual excitement that is "Carl From Chicago" on a Saturday night.

"Binny's" is a liquor / cigar "superstore" in River North. They have a huge humidor and about every type of beer, wine or liquor that is imaginable. They even have one of those "key fobs" that you put on your keychain and can swipe it to obtain a discount.

Prices at Binny's are excellent and they have very intelligent employees. I usually buy wine that is on sale for their "club" members at prices above $10 / bottle; that is pretty good wine at a decent price. This is good for non-wine sophisticates such as myself.

You can see me next to the lit-up entrance at Binny's - it is a sad evening when I get home late from work on a fun night and the main gates are already closed meaning it is too late for the Binny's experience... Posted by Picasa

Still Kickin'

I have received a few emails from our tens of thousands of readers wondering what up. As in where are all of the usual posts. Well I am up - that is the problem. I am up ALL THE TIME.

My brain has always been in overdrive since I can remember. I have this strange thing going on in my cranium. My brain works on problems in my subconscious areas when I don't know about it. It works on silly things sometimes. Other times it works on more serious problems or more complex business decisions. Add to this the problems I have sleeping and you have one pooped dude.

My subconscious side will work on a problem and when a solution is found, no matter how trivial the problem is, it will be happy to wake up my unconscious, sleeping side and tell it about the solution. So that wakes me up. I have a sore throat - that wakes me up. Kid crying, thunderstorm, snow plow, loud stereo - all wake me up. Probably mild sleep apnea as well.

All of this may be my way of saying to you that I am playing with about 50 cards. So be it.

Anyway, enough about my sleep issues. That is the main reason I haven't been posting as much. You will note, however that my posts are way longer and of a much higher quality then they used to be. Many take a very long time to create and are redone several times. You will note that Carl has now gone into a "one-off" style as of late. I think that is great too. We are all much further along reading the type of things you find here than the same old poo that is on most other blogs.

I have also been spending a lot of time at other blogs - The Astronomicon in particular as well as ChicagoBoyz. I am a regular at the Astronomicon in the comment section and comment at ChicagoBoyz once in a while as well. And nothing is more fun than the weekly drunken college football never ending comment thread at The Astronomicon.

I gotta tell you Astro, the proprietor of The Astronomicon and Jonathan, the proprietor of ChicagoBoyz are two fine individuals.

Through it all, our traffic is, startingly, increasing! I attribute this to summer ending. But what do I know about the blogosphere.

Thanks to all concerned for the emails and thanks to Carl and Pete for the wonderful posts as of late. In the words of Kim du Toit: "Now if you will excuse me, I'm off to the range".

Wednesday, October 18, 2006

The Lantern

Posted by Picasa If you are ever up in the far north suburbs of Chicago Lake Forest is a nice place to visit. They have a cute little downtown and a lot of vast estates. This is the suburb where Mr. T once lived and cut down trees in his yard and caused quite a ruckus, back when he was a big star. I can't find the exact quote but I swear somewhere I saw that he said the immortal line "I love the sound of a chain saw" but I can't find it on the web.

In Lake Forest there is exactly one bar (that I was able to find). It is called "The Lantern". The Lantern is a great place to eat and a bar to watch the Bears games (the Bears used to practice up near Lake Forest). I especially like the broasted chicken dinner, which I get every time I visit.

A few more things to like about The Lantern - they have trains up along the ceiling! I love trains, and especially when you are sitting down having lunch or a drink. The kids love them, too. When I came in it was early on a Saturday and the trains weren't on - I found a waitress and asked her to turn them on and I think she was a bit surprised because I was asking and not someone in grade school.

The last thing to love is the sign posted below the train tracks asking parents to keep their unruly kids in check or they'd be kicked out. It must be hard for the parents in Lake Forest to keep their kids in line, without the hired help...

More Synchronicity

I do enjoy synchronicity. There is a certain type of organization that makes the world a slightly better place.

In this case, it is going to a reasonably priced Thai restaurant named "DAO" in Chicago (I always say "DOH" like Homer Simpson when I walk by the restaurant, but that is just my infantile sense of humor) and receiving a beer and a matching beer glass. Sometimes I get this with Pilsner Urquell (I know it is a fake overseas beer but what the hey) and also with Stella Artois.

The carnation rounds out the photo setup.

Too bad I am not much of a photographer... Posted by Picasa

Monday, October 16, 2006

Oh My God

I cannot believe the Bears game tonight... they did absolutely NOTHING on offense and won on defensive scores and special teams.

Of all the NFL games I have watched in my entire life this was hands down the craziest game. At one point I left the room in frustration thinking that Grossman was replaced by McNown or something but somehow it all came together...

I still can't believe what I just saw.

Hopefully the injury to Brown won't be too bad.

Americans In Debt

This won't be a big post as Carl and I have written before about the debt problem in America before on this Blog.

In the Chicago Tribune Magazine section yesterday, the cover story was about how Americans will be soon swimming in a sea of debt. Here's the section that irks me . . . Tessa Thouma, of Carol Stream, Illinois gave her story about how she got into debt. Ms. Thouma bought a condo in Carol Stream in 2005.

Get this, she got to avoid putting a cash down payment by taking out an interest-only mortgage at 7.8% and a second mortgage at 10.9% to cover the down payment.

Stunning. I'm absolutely stunned. If you ask me, laws in this country should be set up to make these types of transactions criminal. Remember, once the deal's done, the mortgage company or bank doesn't care. They know that they'll get their money.

You may call me crazy, but that's why laws are passed. To sometimes protect people from their own stupidity and vanity. To protect Ms. Thouma from herself.

PS Indy posted this but something was foo-barred with blogger and it came up three times so I deleted it and re-posted it under my name

CSI Jumps the Shark

Ever since we programmed Tivo, we watch more TV that we used to.  The following shows usually pile up in our queue:

  • The Colbert Report (daily)

  • Late Night with Conan O’Brien (daily)

  • The Soup (weekly)

  • Meerkat Manor (weekly)

  • The Showbiz Show with David Spade (is it still on?  If so, weekly)

  • Small Space, Big Style (weekly, periodically)

  • My Name is Earl (weekly)

  • CSI – original (weekly)

  • The Office (weekly)

  • Project Runway (weekly)

  • Dexter (when we can find it)

While this sounds like a lot of shows, if you Tivo through the commercials and all the boring parts (i.e. most of the guests and music on Conan) you can blast through in about 1/3 the time.  For Meerkat Manor, they spend ½ the show talking about the prior show and then having advertisements for their own show within the show, so it blows by, too.

The networks now seem to be trying to lighten the load.  Two shows that I used to like a lot, “My Name Is Earl” and “CSI” seemed to have “jumped the shark” this season.  For those not in on the lingo, jumping the shark refers to a “Happy Days” episode where the show pretty much went from being interesting to stupid over the space of an episode where Fonzie literally jumps a shark while water skiing.  Here is a site if you want to have a few laughs and waste some time dedicated to this topic.  Of course, there is a build up as things get stupider but that is the “Tipping Point”, to refer to another popular book.

“My Name is Earl” had its debut episode this season where Joy, Earl’s ex-wife, gets into a dispute with a local super store chain and ends up stealing a truck with a hapless employee in the back to get even and then a whole series of events occur ending up with her being arrested.  At the end of this, the person I watch TV with said “I didn’t laugh one time” and I had to agree.  Comedy without laughter is a sure sign of impending doom.  We probably will watch some of the shows in the queue, but that was likely the end of their run.

“CSI” the original series (not Miami and not NY) also started out this season and has been seeming a bit creaky.  I think that they are trying to compete with some of the other shows like Grey’s Anatomy rather than sticking to what they do best.  In any case, the most recent episode had a bunch of kids “wilding” or beating up on tourists, and it just un-spooled in a predictable and stupid manner.  The kid who was a lab tech (Greg) and now on his own gets stomped by the gang and you could see it coming 1 million miles away, especially when Grissom sends him on his own saying he was a “big boy” now (i.e. no partner = no backup).  Everyone gets worked in a stupid lather and starts pontificating (the sure sign of a terrible series) and then they put Greg in a hospital bed where he can see the family of a boy he killed and stares down the boy’s brother.  The whole thing was predictable, boring and maudlin, just like 99% of what is on TV.

Thanks, network TV, for freeing up a bunch of my time.  

Sunday, October 15, 2006

Drive/Fly

In the true spirit of the blogosphere I am stealing the name of my post directly from Ann Althouse. Here is her original post.

The gist of her post was that she was flying from St. Louis to Madison and got back ultra late because of the typical delays at O'Hare. Of course there are no direct flights from St. Louis to Madison, so she really didn't have much of a choice. Except driving, which she obviously should have done - it is only a six hour drive from Madison to St. Louis.

The comment thread to that post has gone into quite an interesting discussion about the future of air travel and the lengths people will go to to avoid flying. I especially like the comment by the person who just decided to learn to fly and bought a plane. He said that way he can bring all the guns and shampoo he wants and can choose from 4500 airports instead of the traditional 500 the airlines today serve.

Last week I missed my connecting flight from Memphis to Houston and spent ALL DAY in the horrific Memphis airport. That was the day I vowed never to fly with a connecting flight ever again. I cannot count the number of times I have been hosed flying out of Madison. One problem, of course, is that the Madison airport is podunk - but you will never get politicians or city people to admit this. We have only a few choices to fly to. Minneapolis, Detroit, Memphis, O'Hare, Denver, Newark (why?) and, I think, DC.

The other problem is that any flight is, to me, a random event as far as the success of the flight goes. When doing the connecting flight thing, you double your random vairables such as weather, etc. I honestly cannot believe that the airlines can stay in business. I suppose they couldn't without constant bailouts by the government but I don't know enough about it to comment on this intelligently. One thing I know is that if I ran my business like an airline I would be bankrupt in one day. Southwest seems to be the exception to this rule.

In the Althouse post one person said their new drive limit is now eight hours. I think that is right. From now on if I can arrive in the destination in eight hours or less I am going to drive. If it is outside of that range, I am going to take a bus to Milwaukee or O'Hare or Midway, and take a direct flight. That gets me to Chicago, Minneapolis, St. Louis, and Milwaukee. Indy is just outside of that radius but I think I still would do it if I had the choice between the terrible connecting flight and driving.

Too bad for me, most of my business takes me to Vegas, Houston, and the Southeast. The bus and possibly the Milwaukee airport will be seeing a lot of me in the near future.

Chicago Bridges


One of the most visually arresting elements in Chicago are the bridges over the Chicago river. The Chicago River forms the south boundary of the "River North" neighborhood where I live in Chicago, so I see these bridges every day going to and from work.
Per Wikipedia (my source for most everything these days, it seems) these are officially called "Bascule Bridges" which means that they move with a counterweight.
The bridges are raised in a sequence with the boats scurrying from point to point, and it is a lot of fun to watch.
Of course, some bozo always has to ruin it for everyone. When the bridge went up traffic stopped but this guy had to move forward the extra car lengths and now he has blocked Wacker Drive going south. He probably was on his cell phone like everyone else and not paying attention. I wish the "five-oh" was there to give him a ticket...Posted by Picasa

The Case For Cremation

I have mentioned more than once that I am fascinated with death and the way different people mourn. The Amish this week tore down the school where their little girls were massacred by that nutcase a few weeks ago. To a guy like me, that is a very interesting grieving process.

I am also fascinated by traditions of celebrating the dead, such as funeral rites. I was riveted when Reagan died. The state funeral has to be one of the most tradition laden ceremonies anywhere. I recently studied Churchill's state funeral and what all of the things they did represented. Thanks to the internet you can watch some of this historic funeral for more than likely the most important person of the 20th century here.

Being interested in the variety of ways that people celebrate the lives of the deceased, I have thought about the way I want to go out. I have decided that I will donate any usable organs, then be cremated.

Many have religious beliefs that prohibit cremation, and that is fine with me. But the bottom line that I always return to is that eventually...someday...unless you are very famous or extremely lucky...your body will be dug up, moved or completely ignored.

If you think about it there really are very few exceptions to the above rule. The only exceptions I can think of are cemeteries that are attached to churches or cemeteries where immediate descendents are still alive to pay respects or pay the cemeteries owners to tend the graves. The vast majority of people who died and were buried over one hundred years ago are long forgotten, simply grave markers above graves that are no longer visited. Eventually they will be moved, paved over, or developed upon. Like the ones at St. John's Church in Bensenville, IL.

I am not sure if any of these graves are still tended by living relatives, but they are in the way of the O'Hare expansion. As an aside the expansion is already over $400m over budget. I assume that over budget number will eventually go into the multi billions. Sad, but with a totally corrupt and broken state and local government that is just the norm. The taxpayers get hosed again.

There were many legal challenges to putting a runway over these graves, all got squashed in court. So now is the time that these bodies have to be moved. Always the eventual result of burial - either you would be moved, paved over or ignored until development hit the area of your cemetery.

With cremation, there are none of these problems. All you have to do is purchase an urn. You don't even have to keep the ashes for goodness sake. A heartfelt spreading of the ashes on the water or at a place the departed loved in my opinion means a lot more than having ones bones dug up and moved or simply tossed aside.

Saturday, October 14, 2006

The Haves and the Have Nots

I have watched an unusually large amount of Big Ten football this year and it is becoming very clear that there are those programs that are good and those that suck. There is no inbetween.

Michigan and Ohio State are two of the elite teams in the country. Wisconsin is very good and will end up a top 20 team.

Then we have the rest.

Penn State is very average this year.

The best of the rest is Iowa, but they really must have been overrated because they lost today to...

Indiana. A traditionally horrific program that has won two games in the Big Ten for the first time in over five years. Purdue is average this year.

Look who is left.

Illinois, perennial doormat. Just lost to a MAC team, although that isn't the embarassment is used to be. The MAC is becoming very competitive with all of the major conferences. It is truly sad that a good measure of an Illinois football season is that we are considered successful now that we won one Big Ten game this year.

Then we have - oh my god - Michigan State, Minnesota, Northwestern, all basketcases this year along with Illinois.

The Big Ten is very strong at the top three, with a combined record as of this writing of 19 wins and only one loss. The rest of the Big Ten is 27-26. I mean these teams are pathetic.

Come bowl season the Big Ten will get its lunch handed to it in the lower tier bowls.

Friday, October 13, 2006

Give 'Em Hell, Kids

This is refreshing:

BURLESON, Texas (AP) -- Youngsters in a suburban Fort Worth school district are being taught not to sit there like good boys and girls with their hands folded if a gunman invades the classroom, but to rush him and hit him with everything they got - books, pencils, legs and arms. "Getting under desks and praying for rescue from professionals is not a recipe for success," said Robin Browne, a major in the British Army reserve and an instructor for Response Options, the company providing the training to the Burleson schools. That kind of fight-back advice is all but unheard of among schools, and some fear it will get children killed. But school officials in Burleson said they are drawing on the lessons learned from a string of disasters such as Columbine in 1999 and the Amish schoolhouse attack in Pennsylvania last week.

The school system in this working-class suburb of about 26,000 is believed to be the first in the nation to train all its teachers and students to fight back, Browne said. At Burleson - which has 10 schools and about 8,500 students - the training covers various emergencies, such as tornadoes, fires and situations where first aid is required. Among the lessons: Use a belt as a sling for broken bones, and shoelaces make good tourniquets. Students are also instructed not to comply with a gunman's orders, and to take him down. Browne recommends students and teachers "react immediately to the sight of a gun by picking up anything and everything and throwing it at the head and body of the attacker and making as much noise as possible. Go toward him as fast as we can and bring them down."

Response Options trains students and teachers to "lock onto the attacker's limbs and use their body weight," Browne said. Everyday classroom objects, such as paperbacks and pencils, can become weapons. "We show them they can win," he said. "The fact that someone walks into a classroom with a gun does not make them a god. Five or six seventh-grade kids and a 95-pound art teacher can basically challenge, bring down and immobilize a 200-pound man with a gun."

I know how hard it is to hit a stationary target well and am fairly experienced with firearms. Why the hell should all of the students lay down on the floor and comply with the gunman's orders? Make it as difficult as possible for that gunman to hit or sight anything.

I can only assume that most of these school shootings are done by gunmen who have little or no experience with firearms and that if attacked they would be able to shoot a lot fewer students. Especially if the whole classroom did as instructed and whipped every loose object at the gunman and ran at him and gave it all they had.

At Columbine the punk kid gunmen told everyone to lay down on the floor - then they shot the kids as they lay there.

This type of instruction is much needed for our kids and for the populus in general. Children need to realize at an early age that in times of trouble "professionals" won't be around to help until it is too late.

Remember New Orleans?

They Aren't Your Votes

Carl and I have been going back and forth on this issue for quite a while now. I think I am swinging him over to my side - ever so slightly - one millimeter at a time.

My theory is this. If there is a corrupt/stupid Republican running against a Democrat (corrupt/stupid always) there is no reason to vote for the Republican. Parties be damned. The person you are voting for is either competent and clean or NOT.

Along these lines I have been swinging some of my votes in the past several years to Libertarians, Constitutional Party and others. In the last gubernatorial election here in Wisconsin, Tommy Thompsons brother Ed ran as a Libertarian and gained over 10% of the vote. Those votes weren't Democrat or Republican votes that were stolen, they were just VOTES. This year for governor we have the run of the mill election, Democrat vs. Republican.

In Texas, however we have an interesting race between the standard party candidates and Kinky Friedman, running as an independent. Check out his site - he has a lot of good ideas. A lot of bullshit too, but a lot of good ideas. Now the Democrat candidate is bitching because Friedman is TAKING HIS VOTES. They aren't "your votes", jackass, they are just "votes".
The money quote:
Democratic gubernatorial nominee Chris Bell was on the defensive Wednesday after admitting he tried to get independent candidate Kinky Friedman to withdraw from the race. Friedman said he thinks Bell took the action because he is "desperate" and afraid he is losing. "Bell said that he thinks Kinky is taking a lot of Republican votes, but he's taking more of mine," Friedman said of Bell. "The point is that's a great admission to make, but they aren't his votes. You've got to earn votes."


Odd that Friedman speaks in the third person a la Bob Dole, but nevermind.

I would be very interested to see someday if an independent or third party can make a real run at the Presidency. It could happen. If you look at the race for Senate in Connecticut, Joe Lieberman looks like he is going to crush crackpot Ned Lamont. People aren't voting for a stupid party. They are voting for Lieberman. When this happens I am going to have a top quality martini and toast all of the leftist bloggers, papers and everyone else in the Democratic party that fucked Lieberman. And to this end, they will LOSE a Senate seat. I sincerely hope that it costs them the majority in the Senate. Why couldn't we see a scenario like this take place for the presidency? Even more appealing would be if and independent candidate carried enough states to be able to "hijack" the race. In other words, lets say that each major party candidate gets almost enough votes in the electoral college to win, but an independent carries, lets say, Texas and can start wheeling and dealing to get some sane people in the winners cabinet, then swing those electoral votes to that candidate.

You will see major efforts in the near future by both parties to head any movement like this off at the pass. Already several states are moving toward legislation to split their elecoral college delegates. Rigging voting districts is already the norm - just ask Carl about his congressman and the district he votes in.

So the question is, how much can you take? How much corruption and "same old same old" can you handle? Quite a lot it seems. But I think within my lifetime there will be progress. Look at Jesse Ventura. Look at what Friedman is doing. Look at Ed Thompson. Then look at who you are voting for. Do you have to hide your eyes?

Thursday, October 12, 2006

What It Means to Be A Liberal

While tooling through the Chicago Tribune web site I saw the following link “What it Means to Be A Liberal” with 10 following steps.

After reading this sanctimonious crap I almost threw up… but I caught myself, and spent a couple minutes on my response.

“What It Means to Be A Liberal” on Life in the Great Midwest

  1. Never Support the US Military – sure you can say that you support our troops, but neither you nor anyone you knows is in the military or has the slightest idea what really happens there.  You kind of support it in the abstract, like a necessary evil, but in your heart of heart believe that we really don’t need it.  If everyone who was liberal boycotted the military, recruitment / retention wouldn’t be impacted even 1%... because they already did

  2. The Ends Justify The Means – you can say that you support women and feminism and boy do you get in a lather over Clarence Thomas, but when Bill Clinton goes after an intern, you rally behind him because, well, just like the title says, the ends justify the means

  3. Private Enterprise is Bad, Government Is Good – in every movie you watch the corporation is evil, and business is to be distrusted.  You look to the government for a job, and business provides taxes for you to distribute as you see fit.  If you do have a job for a private company, it is just that a job, while you while away the hours dreaming of a higher calling, because you just can’t believe that business does any good for anyone

  4. You are a Hypocrite – sure Republicans go off to live in lilly-white suburbs and hang out with people in country clubs, but, hey, that is what is expected of them.  Liberals in Chicago, on the other hand, live in lilly white suburbs, drive SUV’s, but vote their “conscience” as Democrats.  They support teachers unions and terrible inner city schools because these are their comrades in arms against the Republicans, but they wouldn’t dream of even driving through these neighborhoods with their kids locked in the back seat.  The liberals I have respect for live in the city and live by what they believe, and hats off to them for doing it

  5. Death is Political – the death in Darfur drives you to demand action, but the mad activities of Hussein in Iraq didn’t demand action.  You think George Bush is a murderer, but are strangely acquiescent to actual murderers on a grand scale like Putin (Chechnya, anyone) or the Chinese leadership (killing thousands every year)

  6. You Don’t Provide Solutions – the only thing that unifies Democrats is hatred for Bush.  Fine – but what do they stand for?  What is their plan?  No one knows.  Their grab bag of political affiliations from union power to everything else will reach for whatever favors are at hand.

  7. Never Admit You Are Wrong – when “concealed carry” became legal in Texas and everywhere else, you said there would be blood on the streets and mayhem would ensue.  It didn’t happen, if anything things got safer.  When tax rates were lowered, you said that government revenues would collapse.  It didn’t happen, they went UP instead.  But these mere “facts” don’t stand in the way of the relentless march of your ideology

  8. Idealize Western Europe, but ignore reality – sure Western Europe has the beautiful welfare state you dream about, but Le Pen, a racist who couldn’t get elected dogcatcher in the US, was in a run-off for the French presidency!  And the Arabs and minorities fare much worse in Europe than in the US; they get government handouts but no jobs and they seethe in rage; while we have many problems in the US we certainly give people who want to work the opportunities to better themselves, and both us and the immigrants are better for it.  And the Western European countries, with the exception of England, are useless in a military fashion; their policies flat-out don’t matter because there is no “stick” whatsoever

Liberals can certainly point to Conservatives or Republicans that are hypocrites; people like George Ryan in Illinois or Foley, and the Republicans ought to drum these types out of the party and take their lumps for letting them in the first place.  However, the fact that the Democrats are stinking hypocrites is even more painful because they are supposed to be the party of ideals and ideas, when in reality they are neither.  Once again, no one expects the Republicans to be anything other than what they are; it is the Democrats who claim to be on a higher plane, one they clearly don’t inhabit.

Where Is The Sidebar?

Well, Blogger was wonky this morning and now it appears we are back up - minus our sidebar! I will give it a day or two to reappear. It is hard to complain about anything that is FREE. Carl wanted it redesigned anyway - this may be his big chance.

A Century Apart, Same Theme

I have just finished two important books. The first is Five Years A Dragoon: '49 to '54 and Other Adventures on the Great Plains. The second is Beans, Bullets and Black Oil: The Story of Fleet Logistics Afloat in the Pacific During World War 2. Neither book has much to do with the other except for one connecting theme...brutally, extremely hard work. ALL done by Americans.

Five Years A Dragoon is written by one Percival Lowe. After reading this short book you will agree that the term "adventurer" is very much overused in the modern era when you look at what Lowe did. After leaving school, he became a sailor for many years and then joined the army to help settle the west. This book describes his many adventures in Kansas and other parts of the US between 1849 and 1854. He was in charge of many a wagon train, and ran supplies to the many forts that the Army had put on the Great Plains.

Highlights of the book are the constant negotiations with Indian tribes. To note, there weren't many battles that he took part in or reported. That isn't because he declined to report them, it is because there just weren't that many. In today's history books you would think that the settling of the West was one huge genocide after another, the white man ruthlessly scarring the countryside with fire and the blood of the redman. Upon reading an actual account of someone who LIVED THERE for many years a different picture is painted. Many Indian tribes eliminated each other. The largest problem by far was keeping the tribes from stealing horses, mules and cattle from the Army and settlers wagon trains. Most of this was kept to a minimum by negotiation, bribes of food and conferences brokered by the army between tribes.

Interesting to me is the severe and quick justice that was meted out at times. There are many incidents where Lowe used physical violence against drunks, thieves and others that were causing trouble. Instant justice - it was just the way it was back then.

Most fascinating about this book are the many daily trials that Lowe describes. Things like cholera epidemics and deciding which trails to take (must have good grass for the mules) were choices that us modern day Americans not only would have no idea how to react to, but have exactly zero knowledge on how to solve. My favorite part was when he described how one of his supply trains was stopped in an area of Kansas because there were so many buffalo crossing the path they had to just form up and wait until they passed.

It is absolutely incredible to me that so many men, women, kids, wagons, horses, mules and cattle could be driven across trails, rivers and mountains back then without ANY TECHNOLOGY except a stinking compass and a feel for the land. The reading of this book gets tedious at the end as so many things get repeated over and over but if you read the first couple of hundred pages you will get a great feel for what is must have been like back then.

One thing I would have liked to understand better was what kind of weapons they used. He talks a lot about revolvers and repeating rifles they used and being interested in firearms I would have enjoyed some photos or at least know what kind of caliber of bullets they used. I suppose I can find that out on my own through the internet but it would have been a nice appendix to this book.

Meanwhile, a century later and on the other side of the world, Rear Admiral Worrall Reed Carter (third from left in this picture)














was in charge of Service Squadron Ten. Their primary mission, to keep it simple, was to supply the forward bases and the fleet on our march through the Pacific. This book is written in a dry fashion. It reads nothing like the wonderful Morrison Set that I just finished. As an aside, at $165 the Morrison set is a steal. However, Carter's book is essential to those who truly want to understand what a massive effort it was to move all of the materials from the continental US to points thousands of miles away. We are talking about millions of gallons of all kinds of fuels from aviation fuels to black oil for the mainline battlewagons to lubricants. Don't forget all of the clothes, food, spare parts, ammunition and everything else that was needed. Oh yes, floating dry docks, cranes, garbage tenders, welding gases, minesweepers, machine shops, tank and automotive repair facilities - and on and on.

So many of us get enamored with reading accounts of the battles told so very well by Morrison and others that we, at times, forget that they couldn't be there without a supply chain that worked well. Just ask Napoleon or Hitler what they would for better supply for their armies who were thousands of miles away from home.

This book has lots of outstanding pictures and maps. The photos show an example of each class of ship from fleet tugboats to floating barracks to hospital ships to fleet oilers and everything inbetween. Also there are many, many maps to give you an actual feel for the awesome distances involved in all of this. Carter even delves into the Alaskan campaign which has always fascinated me. Oh, you didn't know that the Japanese occupied parts of Alaska? You learn something new every day here at Life in the Great Midwest.

Unfortunately this book has been out of print for quite some time. I purchased mine from a rare book dealer for $85 and it was money well spent. I quite like the inscription on the inside front cover which has a persons name - Maynard W. (Something) - 1957.

The unifying factors of these two books to me are the insane amounts of hard work that are described - settling the west and fighting in the Pacific ocean. Thousand of miles of wagon trains and supply vessels. Both books make me very proud to be an American.

Wednesday, October 11, 2006

Life in the big city

A few years ago I was walking through an area of Chicago near "Boys Town" where I used to live with a friend of mine from the suburbs. He was made speechless by the various lunatics that lived in the immediate area, including:

- the guy who played TERRIBLE sax in the street right below my windows at all hours of the day and night (how many times can you listen to the theme from "The Simpsons")
- the crazy homeless guy who lived in the ATM machine (on the bench where you wrote your checks) and relieved himself in the garbage can
- a guy walking down the street in the middle of the day, shirtless, with blood all down his chest from a wound on his forehead

The thing is, I didn't even bother pointing out these people to him, because, to me, they aren't even news. If I thought it was news every time I saw a deranged homeless person, I would be suprised 24*7. ANY of these people would be arrested within 30 seconds of setting foot in any of the upscale suburbs that ring Chicago... but here, it is just the way things are, I guess.

It was all kind of summed up to me when I saw the typical "begging" sign made from a cardboard box in the construction debris...

The debris from the TRUMP TOWER. Yes this is the other 1/2 of Chicago, going along with the fact that I am not astounded that the Trump tower is selling well even though 1) it is super expensive 2) it is going up in a horrendous real estate glut.

There are a lot of people with a lot of money; they aren't afraid to spend it.

And they aren't surprised to share company with a lot of deranged homeless people.

And that is why this post is called "Life in the Big City"...Posted by Picasa

Tuesday, October 10, 2006

Thanks, Bill and Madeleine

Here’s something you won’t expect from this blog.

I like Bill Clinton.

Bill Clinton, as a person, is one of the most personable people around. If you met him in person (which I never have) I’m sure he’d be a gracious host and charm with wit and intelligence.

Bill Clinton’s personal history growing up is also appealing. He was the son of a single mom in Arkansas and he grew up to be the President of the United States of America. To say that the odds were against him is a fantastic underplaying of the immense obstacles that he has overcome.

While all these things are nice and I’m sure that Bill would make a fantastic living as a guest appearing frequently on Oprah with Dr. Phil, he was abominable as a President. The things that make him appealing, such as his charm and ability to “spin” reality into whatever he saw fit (or which was most politically expedient), left the USA with a horrible legacy.

This week the legacy came to roost with North Korea’s reported nuclear test. I personally am not convinced that North Korea actually pulled off a test; the reported power was a fraction of the first bomb that the USA dropped on Hiroshima and the North Koreans are a crafty bunch.

I remember back in 2000 when the Clinton administration and their inept, politically correct appointee Ms. Albright made their trip to North Korea to “solve” the problem through diplomacy. Nice words were exchanged, and pleasantries too, and it was a shining example of the left in their approach of “talk, not war” towards dictators and other associated difficulties. This article cites the “HISTORIC TALKS” that took place in North Korea under his watch.

But, really, these talks were actually WORSE THAN USELESS. They allowed the North Koreans to buy time to build their arsenal, while it APPEARED that the US was taking SOME action, which staved off other, more useful action.

I am not assuming that there is some “magic answer” to this problem; the North Koreans are hard, hard men and lunatics to boot. South Korea really doesn’t want to kick this can over; after over 55 years of isolation there is little or nothing to unify the 2 Koreas; even family ties have frayed to nothing. They see the enormous bill wrought by the German integration while they are not nearly as rich as the West Germans were and the North Koreans are immeasurably poorer than the East Germans.

I hope that doing nothing (diplomacy) doesn’t turn around and kill millions of US citizens; it is certainly possible. Letting North Korea arm itself for years has degraded the security of the US significantly. It gives the writer no pleasure to say “I told you so” on this event.

Monday, October 09, 2006

That Ain't Right

Hmmm.... some more slick marketing.

Let's find the girls of Nascar and of all the hostess products that they can support, such as Twinkies, CupCakes, Fruit Pies, etc...

Let's pick "Ho Hos".

I guess the only way it could get any worse if there were only 2 girls on the box.

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Sunday, October 08, 2006

Odd Movie Synchronicity

A few years ago there was a quickly forgotten movie called "Laurel Canyon". The movie starred Christian Bale, who subsequently starved himself for "The Machinist", in the title male lead.

This movie had a dopey hippie subplot that was forgotten instantly (even though it was ostensibly the purpose of the movie). The REAL challenge in the movie, from my perspective, was Christian Bale as the lead character as he chose between:


  1. Kate Beckinsdale - the smoking hot brunette who subsequently starred as the barely clad werewolf / whatever in the terrible "Underworld" series (as well as the horrible "Pearl Harbor) - as his fiancée

  2. Natascha McElhone - the smoking hot redhead who subsequently starred in "Solaris" (which is actually my favorite book of all time, regardless of how the movie was made) - as a co-worker who has an intense desire (crush is too light a word) for Christian Bale's character
The woman with whom I went to the movie with instantly forgot this turgid mess; for me, however there was a real choice between Kate's and Natascha's characters.

Normally Kate would win between her and virtually any female in the universe. She is flat out smoking, with a beautiful face and a body that looks great clad in whatever insanely tight clothes, latex or leather is at hand.

However, Natascha puts up a ferocious fight in one of the most romantic scenes I have ever seen in my life - in a car with the title male lead she hits on him in an amazingly sultry scene and they make out and it is amazing - you need to see it to believe it.

While everyone else had forgotten the movie (because of its dumb main hippie plot) for years I was still pondering the difficult choice Christian Bale faced between these two fabulous babes.
And where does the synchronicity come in? In "The Departed", a shrink played by Kristen Dalton (I don't know her, either) has to choose between:

  1. Matt Damon - as the smooth but bad guy who has infiltrated the police department as a "rat" for the mob

  2. Leonardo DiCaprio – as the rough but good guy who has infiltrated the mob as a “rat” for the police
I can’t speak for women but would have to guess that a choice between these two leading actors would have to be similar to the choice faced by Christian Bale. Oh, and by the way, when Leo starts sneaking around your back door with your wife or girlfriend you pretty much have lost from the get-go. You can’t win.

An odd synchronicity between these two movies, then…