Saturday, March 31, 2007
- We have a flat state income tax on individuals at a relatively low rate (good)
- We have very high property taxes (bad)
- The state's pension funds are in some of the worst shape in the nation (bad)
- We have a very high sales tax rate (bad)
- We have a generally OK tax rate on businesses, except for the property taxes (OK)
Our governor, the Democrat Blagojevich, has ambitious plans for expanding the role of the state. He is basically building up a publicly funded health care network that is covering more and more of the poor in the state of Illinois. He also wants to spend more on public schools and infrastructure.
In parallel with the above items, Illinois is generally viewed as a corrupt state. We could link to literally thousands of links showing poorly run, patronage ridden government entities functioning ineffectively. We also have some of the worst public schools in the City of Chicago. No effective plans are being put in place to resolve any of these issues, but new taxes will provide additional funding.
In order to fund the new schemes, the governor is proposing a "gross receipts tax". Our current taxes are applied when goods are sold (sales tax) or on the net income of an enterprise (income tax), as well as on property owned (property tax). A gross receipts tax is a different type of animal, more like a "value added tax" that is popular in Europe, or VAT.
The gross receipts tax is applied on business activity whether or not it is profitable. For example, if you have a business with a lot of sales but not much income, you will pay taxes under this model, even if your business doesn't make a profit. For this reason it is very unpopular among certain types of businesses that don't pay much in income taxes today.
The gross receipts tax is also hard to administer. It is relatively easy to take the Federal income tax return as a model and calculate a state tax "offshoot" - and it is relatively easy to tax sales or property at their final sale. However, gross receipts tax is supposed to tax business activity in the state even if the final product is sold in another jurisdiction. Thus companies will be forced to track all this activity in a parallel thread to their existing tax books, which are already separate from their financial books.
The net effect of a gross receipts tax, like a VAT, is that things get more expensive to the end consumer but the burden of the tax is placed on businesses. For example, the sales tax is visible to the end customer, but the gross receipts tax would be "eaten" by the business and then passed on to the end customer in the form of higher prices as each firm along the value chain passes on their cost increases. Once you have a VAT or gross receipts tax in place it is easy to raise the rate in a stealth manner without the politicians having to feel the public outcry.
Facts on our particular plan are hard to come by. The State of Ohio implemented a gross receipts tax in combination with an overall tax reform including the reduction of property taxes; in Illinois an attempt was made to implement the tax in isolation which garnered little or no public support. This plan went nowhere and recently a revised plan was being put together by the Democratic governor and legislature that includes some tiny reductions in property taxes to partially offset the impact.
The Tax Foundation, an excellent research tool, wrote an article titled "Gross Receipts Tax: Wrong Way to Fund Illinois Government". From the article:
"The chief economic problem with gross receipts taxes is the pyramiding nature of the tax. That is, since the tax applies each time a business sells its goods or services, the tax "pyramids" on products as they move through the production process. The longer the production chain, the higher the effective tax rate on the final product.
Thus, a gross receipts tax badly distorts and interferes with business investment decisions, leading to lower economic growth and job growth. Sales, income and property taxes do not have the same tax pyramiding feature, making them more economically efficient taxes. A $6 billion increase in any of those taxes would cause far less economic harm than a gross receipts tax that raises the same amount of revenue."
This article summarizes the key negative elements of the tax policy - a distortion of economic activity. The best tax policy takes its "bite" without causing excess burden in record keeping and encouraging positive, profit making behavior. The fact that the gross receipts tax is another parallel record keeping stream as well as taxing UNPROFITABLE activity makes it among the worst of all systems.
The tax foundation sticks to taxes, so they did not add the editorial comment that this additional tax revenue would be applied to a corrupt government that is facing investigations from all directions, with the last governor about to go jail and the current governor in the paper frequently for various scandals. They are not even "pretending" to reform the system to cost less money or be more efficient; it is just "good money after bad".
It is a sad period for the State of Illinois.
I came to work this morning and what did I see when I walked into my office?Another K-31? This one is in beechwood. I have no idea how it got there!
Since it is here, and I have begun the research and restoration of my first K-31, no better time than the present to begin on this one as well.
The internet can be a total sewer at times, but the amount of information out there is truly astounding. I had never heard of a K-31 a month ago, but as of now, I have read probably the equivalent of several small books on the subject on message boards, privately run websites and forums.
I could tell right away when I saw that K-31 on the left in the above photo that it was not as old as the other one. Beechwood stocks were used after the walnut ones were phased out, sometime after WW2 if memory serves. You know, after looking at many photos on the web of refurbished K-31's I think I almost like the look of the lighter wood better. Time will tell with my examples after I get them cleaned. Some of the K-31's in walnut I have seen turn out stunning as well.
From the serial number on the one that just "appeared" in my office, I can tell that it was made in 1955. Lets take off the buttplate...YES! Again! Haha, another Paul.
Looks like this one is a much bigger mess than my walnut stocked one. Check out the bore:
I will post more info on this as time allows, now I need to decide which one to restore first. I wonder if I should perhaps do both at the same time. It may be interesting to see if/how they changed the design of the K-31 as my walnut one is thirteen years older than the beechwood stocked one.
And if anyone can explain how this other K-31 mysteriously appeared in my office next to the other one, please drop a comment in here to explain it to me.
Friday, March 30, 2007
But if you travel to northern Wisconsin, around Superior, you tend to get a different class of hunters. Drive down a rural road, then hit the gravel, and finally down some ruts to a double wide in the middle of the woods. These folks are a little different. But one guy from Superior has brought new meaning to what to do with deer.
SUPERIOR, Wis. — A 20-year-old Superior man received probation after he was convicted of having sexual contact with a dead deer. The sentence also requires Brian James Hathaway to be evaluated as a sex offender and treated at the Institute for Psychological and Sexual Health in Duluth, Minn. “The state believes that particular place is the best to provide treatment for the individual," Assistant District Attorney Jim Boughner said. Hathaway's probation will be served at the same time as a nine-month jail sentence he received in February for violating his extended supervision.
“The type of behavior is disturbing," Judge Michael Lucci said. "It's disturbing to the public. It's disturbing to the court."
"The statute does not prohibit one from having sex with a carcass," Anderson wrote.The Webster's dictionary defines "animal" as "any of a kingdom of living beings," Anderson said. If you include carcasses in that definition, he said, "you really go down a slippery slope with absurd results."Anderson argued: When does a turkey cease to be an animal? When it is dead? When it is wrapped in plastic packaging in the freezer? When it is served, fully cooked?
Click any photo for larger.
Thursday, March 29, 2007
Regardless of the post, McCarthy is in fact a good writer. In college I read Suttre about a strange guy who turned his back on money to live with derelicts in a houseboat (or was it a plane fuselage?) and recently I read "No Country for Old Men" about drug deals and shootouts in Texas in the 80's.
A lot of the protagonists in McCarthy's novels are "survivalists", guys who know a lot about weaponry and how to live off the land. He clearly has a background in this type of knowledge.
OPRAH is going to pick up this book for her book club. I find that to be COMPLETELY ASTOUNDING. The book is the darkest thing I have read since "The Black Book of Communism"... you should tape this on your tivo and watch the stepford wives of Oprah being taken totally aback.
Yesterday I went to the gun shop, fully expecting to get a copy of the owners ffl, or Federal Firearms License. For those who don't know, guns cannot simply be shipped to your private residence (well, some types can), rather they must be shipped from one gun dealer who holds an ffl to another gun dealer who also holds one. For this service, all of the dealers in my area charge $50. It is fair, as they are the ones who have to fill out the paperwork before the firearm ownership is transferred. I don't work for free either (most of the time).
I have purchased guns from this particular dealer before and how pleasantly surprised was I to find sitting on his racks two examples of the very rifle I was searching for, the Swiss K31 Karabiner! He had one in beechwood and one in a walnut stock. I chose the walnut. The price was $285. I paid too much. But look at it this way.
If I were to purchase one from Samco for $159.95 (this is for medium grade), I would have had to pay the $50 ffl fee, as well as shipping (about $25) and would not have had the chance to look the piece over before I received it. And I saved about 45 minutes of time for the extra trip I would have had to take to the gun dealer to pick up my gun as well as the gas money. If you look at it this way, I still paid about $50 too much by the math, and if you figure in the extra trip, gas money and all the rest, it looks to me to be about a wash. Pay me now or pay me later, isn't that what they always say?
I also picked up sixty or so rounds of ammo for the gun, but it will be a while before I am putting rounds downrange with this piece as I have a lot of work to do. So here it is, I am calling it "Paul". We will get to the reason behind this in a bit.
Looks as though the butt end of the stock was resting in water at some point, or the crud and crap had leeched in to the point where the slip of paper was. Either way, the stock is simply nasty, but I bet will be beautiful when I am done with it. I wouldn't have it any other way. Once the thing airs out for a few weeks, I will be taking it down - just being in a relatively clean environment it may start leeching crap on its own, who knows. First, I have a lot of research to do on my new gun, and the next post will have to do with the various markings that are stamped and marked on it.
Tuesday, March 27, 2007
I am toying with the idea of purchasing a mil-surp gun or two. For those not in the know, mil-surp is short for military surplus. There are literally millions of rifles available worldwide that used to be employed in different countries, for different purposes.
There are weapons that were actually used in battle, training pieces, and others. I got started on this from reading Astro's blog - if you check out his gun posts, the photos are great and he explains in very good detail what is all involved. He was nice enough to take some time to give me some advice a few days ago.
There is a lot of work involved with mil-surps, but it looks like fun and a labor of love. They are usually packed in cosmoline.
This means that a full disassembly of the rifle will be in order, down to every part, including the stock as I will want to clean that up as well. Knowing my wife's aversion to chemicals and general nastiness, I will more than likely have to do this either at work or some weekend when she is not home.
I have been studying many of the different mil-surps available and their price ranges, and I think I have decided on the K-31. It was made by the Swiss from 1933-1958, and shoots a 7.5x55 cartridge.
Every single thing I have read about these rifles say that they are the bees knees. Most will arrive with many nicks on the stock. This is apparently because the Swiss troops when training carried them on their backs and used them for all kinds of things other than shooting - and normal wear and tear. I have called several dealers and all of them say the same thing - that on many of the less expensive examples the rifling on the gun is perfect, but there is bluing loss and many nicks on the stocks.
The choices are either beechwood or walnut for the stock. The beechwood ones go for anywhere from $139 to $159, while the walnut versions seem to have a premium of $20. I think I would like walnut.
I have read in many places that many of these guns have under the buttplate an identifying paper that has the name of the person and their unit and location - most of these are in the beechwood variety.
I think I would rather have a walnut version than the possibility of the troop identifier with beechwood. But priority for me is one that has all matching serial numbers, and a really good bore, because I don't plan on putting it on display, I will be shooting it.
But why was I drawn to the K-31? Well, lots of recommendations from people that know a lot more about firearms than myself. Also the K-31 is somewhat unique in that the action features a straight back pull on the bolt. Here is a photo of the bolt pulled all the way back.
This is a photo of the rifle in its entirety.
And I like this photo - note the Swiss shield on the top.
Note the spent casings eject out the top when you pull the bolt back. Here is an excellent youtube showing a guy shooting one.
I think I am going to do it - but still thinking about it a little. My only gripe is that I am always at a bit of a disadvantage on these things because I have to eat a $50 ffl fee from the gun dealer and the freight inbound to me of about $25. So right off the bat there is $75 gone. Still, for a landed cost of around $250 I will have a very high quality firearm that I will very much enjoy for the rest of my life - and I will definitely enjoy taking apart and restoring my rifle to shooting condition.
As Dan pointed out in a recent post, we don't like to point out the same old obvious points that everyone else on the web blogs about. However, I saw this book at a local Barnes and Noble and stood there dumbfounded.
This idiot really wrote a book that said that Chavez, Castro and Morales from Bolivia were the "Axis of Hope". And yes, that is a halo over Castro's head. This guys' car better never break down in Miami, they'd tear him limb from limb...
Monday, March 26, 2007
In a prior job I worked with Cook County in a financial capacity. I won't go into that in this post but the areas that I came in contact with were some of the most poorly run functions that I have seen in any business or governmental entity, anywhere.
Cook County is currently undergoing a financial crisis. The County is being forced to consider staff cuts and cuts to operations, including local clinics. The billboard above was bought by the local nurses' union to protest firings of nurses and proposed health care clinic closings.
The billboard jumps right to the point - eliminate patronage hiring, not people on the front line like nurses. Of course, this is never going to happen; the essential reason for county government to exist is almost solely to find jobs and easy government contracts for cronies of the county. Services and quality aren't on the priority list, anywhere.
The immense drain on county services is HEALTH CARE. Cook County operates a large health care system that serves the indigent within Cook County, the vast majority of which are within the City of Chicago (some of the suburbs, particularly in the south, are very poor, but their numbers of poor people are dwarfed by the inner city of Chicago. Plus, many of those poor people can't get to the facilities located within the city).
Per the 2005 Cook County financial statements (which I will take apart in detail sometime when I have time to post) which you can download here - on page 13 they describe the health care facilities provided by Cook County, which include three major hospitals and a large health care bureaucracy. Per the financials:
"Program revenues... are not keeping pace with the accelerating costs of health care operations thus resulting in a $374 million loss from operations in 2005". The county hospital system has expenses of ~$1 billion and revenues of $650M. Note that this does not fully include the costs of capital construction.
If you look at other counties, such as Dupage county, for example, where you can find their 2004 report, their health care budget is approximately $44M and they don't own any hospitals. Their revenues come close to covering their overall costs. Dupage county is significantly smaller than Cook County and this is seen in that their health budget is only a fraction of Cook's - but the most important number is that health care isn't nearly a net drain on the county compared to Cook County's financials.
The only reason that Cook County is able to afford this massive health care system for the poor is that Cook County is so physically large that it holds a huge swath of affluent neighborhoods and suburbs that are essentially taxed for services they'd NEVER use (no one intentionally enters a public health care facility in Cook County unless there are no other options) which allows them to subsidize this service to the poor.
These nurses are complaining but the real issue is how long Cook County can afford to provide this vast, money losing health care network. Taxes continually go up in Cook County for services that the residents who pay taxes will never use.
I am surprised that there haven't been more instances of suburbs threatening to break away from Cook County - in Atlanta, Fulton County, which has a lot of similarities to Cook County, is starting to have a serious push to split the suburbs off from the city to create their own county. Here is an article describing the proposed split in Atlanta:
"The plan's chief sponsor, Representative Jan Jones of Alpharetta, says Fulton County is too large and dysfunctional to be considered truly a local government... Milton County would have a population of about 300,000, instantly making it Georgia's fifth-largest county. Those residents represent 29 percent of the county's population of 915,000 but pay 42 percent of its property taxes, according to a local taxpayers group. A split would lead to the loss of $193 million in property taxes alone for Fulton County."
Sadly enough, Fulton County in Georgia probably is a model of good government compared to Cook County. I could link to literally thousands of posts regarding corruption, losses, filth, bad government, patronage, etc...
The real question is, why do the suburbs and affluent residents, who receive almost nothing of value for their tax dollars, put up with it? When will Cook County suburbs and upscale areas try to do to Cook County what they are doing in Atlanta?
The nurses will never get the patronage issue fixed, but taxpayers probably will swallow another big tax increase to keep the dysfunctional and corrupt system "running" for another year. And perhaps we are just moving that much closer to a tax revolution or secession...
Finally, finally it was warm enough to be outside without several layers of clothing - what a difference a week makes. So I spent the whole weekend outside.
A beautiful crocus or two has opened.
I also had time to erect the gazebo in the back yard. The cloth for it was stored in our shed over the winter, and some industrious mice gnawed a hole in it. They also got to a lot of other stuff in there. Unfortunately for them my wife, in her previous career, was involved in the sales of rodenticides. Bye Bye mice.
And the grass isn't exactly green either.
But all in all, what a great weekend - we will most definitely take it. Oh one more thing - I was the talk of the 'hood in my new and always fresh footwear.
Saturday, March 24, 2007
When I was in college in the late 1980's I took a graduate level economic class on centrally planned economies. At this point in time the cold war was still ongoing and the study of centrally planned economies was necessary to gain insight on the behavior of our rivals, the Eastern Bloc countries led by the former USSR and China under the PRC.
GOSPLAN was the name of the organization that ran the centrally planned Soviet economy. GOSPLAN devised the five year plan that was used for goals and also tracked statistics (i.e. how many tractors produced, tons of steel, etc...) to measure performance.
In a planned economy, "quotas" or production targets were set for various consumer and industrial goods (i.e. socks, tanks, tractors) and then plans were put into place to meet these goals. The raw materials were gathered, sent to the appropriate factories, and ultimately sent to a distribution network for the citizens. Rather than "demand" driving what was produced, the central government decided how much of what to produce and that was the basis for the "centrally planned" portion of the economic description.
To some extent this worked better for the industrial portion of the economy than for the farming component of the economy; regardless of what anyone has to say about the USSR they were able to fashion an industrial base that allowed them to produce tanks and weaponry to beat Nazi Germany in WW2 and give the USA a "run for the money" for many years during the cold war. Collective farming didn't have the same positive impact on output, and the Soviet Union had difficulty feeding their population and had to import foodstuffs or buy it on the open market.
There were obvious problems with this methodology; for one, quality was generally ignored. If you were measured on tons of steel, that was the key output, regardless of the quality of the output. The manufacturing process suffered for it; if a supplier gave the next producer an inferior product, they had great difficulties in creating a complex final product. The former Soviet Union had great problems with production of high end computers, electronics and cars as a result of the limitations of central planning; although high focus and the use of terror allowed them to have a higher quality level on some military outputs.
Market Economies vs. Centrally Planned Economies
Most people today take it for granted that capitalism, with the BUYER determining demand and what gets produced, and individuals free to make decisions, is the dominant and preferred form of economics. However, in the 1930's through the 1960's, this was in doubt. Kruschev famously pounded his shoe on the table at the UN and shouted "We will bury you" summarizing his opinion on the superiority of centrally planned economies over market economies. In the 1930's, for example, capitalism was clearly on the run - the US, Britain and France were in the grips of the great depression, Germany, Italy and Japan were under fascism (whether or not that was centrally planned or semi-free market is a debate way beyond this post, but they clearly were at least partially planned economies), and the USSR was pushing communism (socialism). Even after WW2 Britain was mostly bankrupt, the empire was moving into socialism or chaos, most of Western Europe was in ruins and being propped up by the Marshall Plan, and the USSR and China seemed ascendant.
By the 1980's the threat had receded and capitalism was clearly proving to be stronger, but still the Soviet Union and China were pushing their own version of economics. It was in this era that I took this class on centrally planned economies.
Morality of Economics
In the class we discussed the relative growth rates of the centrally planned economies and the market economies. While the numbers may be in dispute, there were years where the centrally planned economies showed higher growth rates than the market economies. In the long term, growth rates are what matters, since countries that lag even a percentage point or two get buried by the higher growth newcomers (look at a country like South Korea compared with sub-saharan Africa; they started not far from each other but South Korea's growth rate made all the difference in the world).
Since it was a college class there wasn't a lot of participation, except to answer questions asked and show a grasp of the material. I, on the other hand, was getting pissed off.
For example - in the 1920's and 1930's the USSR showed strong growth. BUT AT WHAT COST?
For example, the "White Sea Canal" was built during this time period. It is a fact that building out an infrastructure is positive for long term growth (although the usefulness of this canal in particular is subject to dispute). However, thousands or hundreds of thousands of laborers died digging this canal by hand.
What would the growth rate be of the USA in the 1920's and 1930's if the government was going to force thousands or hundreds of thousands of laborers to work to death for a pittance (or merely to survive)? Granted, working conditions at the time were not nearly as nice as they were today, but "The Grapes of Wrath" seems like a walk in the park compared to the Gulag.
You can't compare situations where completely immoral and ruthless dictators use people like slaves to those where individuals make decisions of their own volition. That was the basic point of my question, but it mainly received blank stares from my professor and fellow classmates, because they were just focused on the material at hand rather than a longer range view of the morality of life independent of economics.
Environmentalists didn't realize it at the time, but their biggest allies against emissions were the repressive, brutal and incompetent centrally planned economies. While the centrally planned economies often damaged the environment and did not invest in safety or pollution reduction equipment, their smaller total economic footprint meant that there was less net emissions. Even India, while not as brutal to their own people, accomplished much the same result by banning most imports and strangling their country with red tape (the famous license Raj).
Today, however, India, China and even Russia (buoyed by oil prices) are achieving high growth. These countries have (mostly) pushed aside central planning and economic growth is much better. People want heat for their homes, air conditioning in the summer, cars, air travel, and other amenities that we take for granted in the West. With this growth comes and explosion of demand for goods and services that in turn cause pollution due to higher economic output.
But how can we make these judgments? Is it better for the world to have people in the former centrally planned economies live without what we, in the West, take for granted, in order to "save" the environment? Should we re-instate Stalin and Mao and the Indian bureaucracy, to put the boot back on the neck of their people to avoid growth?
All of the other variables in the pollution equation are mere "noise" compared to the incremental pollution and emissions that are going to be created by China, India and other formerly centrally planned economies. These people want what they see on TV, which is what we have. They want what you have.
And, like comparing the Centrally Planned Economies vs. Market Economies, you can't talk about emissions without linking it to the morality of letting people live to their full potential.
Forget about “Save the Whales”. No stickers for Starbucks. Ask a resident here to donate to help plant a tree and he’ll probably ask how long before the tree is big enough to hold a tree stand. Hunting, fishing and off-roading are big here, and the stickers (especially pickups and 4x4s,) reflect this.
He posted those sage words around a month ago when describing a certain activity. Can you guess what it is? I will give you a bit of space here and a photo of Shamu from my helicopter ride a few weeks ago to stare at while you are thinking (click for larger, you can see Shamu in the pool). Just what activity could there be that has all of the very best people mired at the bottom and hacks and partisans and persons with virtually no talent propped up at the top?
Ding! Times up. Did you figure it out?
It's BLOGGING. I couldn't believe it when Steve wrote that quote several weeks ago, but it is absolutely true. Hacks like Kos, LGF, Atrios and others sit up at the top of the heap, creating virtually nothing of real value to anybody but the true believers. Meanwhile you have posts like this written by virtual unknowns that sit buried in the pixel dumpster.
I bitch every once in a while because I am bitter that people who read blogs don't think more of themselves. I used to read LGF (no, I am NOT linking any of these blogs on purpose) myself but one day I was disgusted that I was wasting even more time on yet another "moooooslims suck" post.
I guess what I am trying to say is that if you decide to start blogging (and I hope you do) be ready for people to NOT read your posts, no matter how much thought, effort and beauty you put into them. It truly is a labor of love and you have to decide to do it for the right reasons.
Always remember that blogging is one of the very few activities where the very best sink to the bottom amid an ocean of crap.
Friday, March 23, 2007
On a parallel track, when I gamble in Las Vegas, I like to play craps. I am not a gambling expert but in general the two games with the best odds are blackjack and craps. I enjoy blackjack but it is kind of rote in that if you don't follow the plan exactly your table hoots at you for messing up their cards. I don't like getting nailed down like that and it is a bit of work especially after a few beers.
To play roughly even odds craps, however, doesn't take much skill or brain power. You play the come out roll, which has roughly even odds overall, and then you put down "odds" on the number that comes up which is definitely even odds. If the dice are in your favor you can buy a 6 or 8 or perhaps even a 5 or 9 if you are really hot.
The sad part of craps, however, is when you get all "set up" and then disaster strikes. For example, you have 10 bucks on the pass line, 50 bucks on odds, you bought a 6 and 8, and the shooter is ready. If the shooter starts hitting numbers, you are going to rake it in. And...
he rolls a SEVEN. Ouch as the house clears away all your chips from the table.
This is kind of what I feel like with the White Sox for 2007 - I am all set up with tickets in 2 sections, have a club pass, and am ready to go. If it goes well and they do the equivalent of hitting numbers, I will be sitting pretty. But if they go on to a 72 win season (like some computers are predicting), then I will have set everything up just to watch it go down the drain.
In a lot of ways I fear the Sox will follow the path of the Cubs. The Cubs almost won it all one season, the next season they almost made the playoffs, the following season they were bad, and the season after that they were truly awful. The Sox won one season, almost made the playoffs, and now are on the cusp of either doing bad or sliding way down...
'Just two days before Shari Scott and her family were supposed to move into their new home, her loan officer at New Century Financial Corp. called her with some bad news: The company wasn't going to be able to lend her the money for her mortgage after all.
"I literally stopped the car and threw up," says the 30-year-old accountant from Burleson, Texas, who got the news on her cellphone while driving home from work this month. By that point, she already had the mortgage title papers in hand and was supposed to close on the loan the next day. "Homeless was the first thing that went through my mind," she says.Later in the article they provided a "happy" ending to the story:
Ms. Scott was able to arrange a new subprime mortgage, but the monthly payment was several hundred dollars more than the New Century loan.
Traditional Journalism - Missing The Point:
From the perspective of "classic" journalism - this is a perfect story. A business event looms that is abstract - the fall of the subprime loan market and New Century Financial is on the edge of bankruptcy. The intrepid reporter went out and found the "human" touch - someone who embodied the issue at hand - and then a gold mine! The person said they opened their car and vomited when their mortgage was rejected (due to New Century's crisis). Finally, the protagonist, Ms. Scott, had a happy ending when she received another loan. A gold star for this reporter, right???
The real story is something else entirely:
1) New Century Financial's problems stopped Ms. Scott from signing up for a dubious product, inappropriate for her, that she probably barely met the qualifications to receive
2) Her loan being rejected SHOULD HAVE been a blessing in disguise... a chance to re-evaluate her reasons for purchasing the house and how it will impact her financial picture. The fact that she contemplated homelessness because she couldn't pick up a sub-prime mortgage doesn't paint a pretty picture of financial health
3) Look at the sad ending. The only thing lousier than the sub-prime loan that she failed to get was the WORSE sub-prime loan the she picked up, instead, costing her several hundred dollars more each month
4) and even though the housing market is cratering, Ms. Scott just barely crept in under the wire, managing to purchase a house at the peak of the bubble market, virtually guaranteeing little or no price appreciation for the next five years or so
The sub-prime mortgage market is complex. There are products that are interest only, meaning that every payment doesn't dent the principal for a period of time. Some of these interest only mortgages DON'T EVEN COVER THE INTEREST, meaning that the balance is actually growing while people are making payments. Virtually all of these products have almost nothing down, so there is very little equity in the home, meaning that as soon as prices dip even a little the borrower is underwater.
It is hard to think of who these loans are appropriate for. If you don't have money for a down payment, then you probably shouldn't be buying a house. If you can't afford a payment that is part interest and at least reducing the principle a bit, then you shouldn't be buying that house (maybe a smaller one is better for you). About the only situation I can think of is when someone is an investor and wants to buy a house, pay minimum payments, fix it up, and "flip" the house in a short period of time. This is a "gambler" mindset, and it can certainly work well, in some circumstances, but it doesn't sound like Ms. Scott's situation.
The sub prime market is a new creation, and one that is unlikely to be as robust after the current shake out. Many of these fringe borrowers will go bust as soon as price appreciation ceases and about a year passes, and the market will be overloaded with cut-rate homes. These homes will put pressure on other marginal borrowers, and lead to tough times. Meanwhile, the originators of the mortgages, companies like New Century Financial, will go belly up when they are forced to take back the terrible loans they originated. These problems which stemmed from poor regulation will likely be fixed and credit standards will be tightened, as well as standards for loan originations (i.e. get rid of the fly-by-night companies).
That is the real story... poor Ms. Scott had her chance, but doubled down on the wrong plan. Too bad the WSJ didn't catch it.
I got a medium depth charge and sat down to go over a few things. Sometimes when you need to get a train of thought going it is good to go somewhere and hide out. I had some work things and some personal things to tend to so this was a perfect setup. I thought everything would take me about an hour or more, but I finished my work in just over thirty minutes. It is amazing what I can do when I am not interrupted and can concentrate on what I am doing.
After that I decided to relax and enjoy the rest of my coffee. Next to me were a couple of young women, clearly college students cramming for a test. Spring Break is coming and I assume they had midterms on the way.
Through their conversations (yes, I was eavesdropping) I could decipher that one was studying some sort of anatomy class and the other had an economics test coming.
The girl with the econ test piped up to her friend that the text she was reading was wonderful and helped her understand things so well. She showed it to her friend and I took a peek at it as well - it was written by Paul Krugman. Yes, that Paul Krugman.
It is an unwritten rule at this blog that we don't waste time taking apart idiots like Paul Krugman, Frank Rich and all the rest of the mental midgets at the New York Times as it is just so easy and nothing is gained from it whatsoever.
Astonished at seeing that name as the author of the text I instinctively said "oh my god" out loud - it was quite rude of me but the woman was very nice and just looked at me and said "what?"
I apologized for nosing in on their conversation and just said "I hope there is more than one Paul Krugman", then collected my items and departed. God help that class.
Thursday, March 22, 2007
That fact didn't really make too much of a difference to me as I was there mostly to look at the neat photos, see some videos and learn a thing or two.
I have always been a "foodie" and a history junkie on top of that - so I am always very interested in what people ate in days gone by. It is fascinating to see different preparations of foods - the same things we eat today - that are no longer used. Many things that were eaten every single day even just a half century ago are frowned upon, or have been improved upon to the point where the original thing is practically gone. An example of this is lard. Only die-hards use real honest to goodness lard for cooking anymore. Just for kicks someday I am going to cook something in lard to see how it tastes. My family rarely fries anything (sauteeing is NOT frying) and it would be a real treat for the kids to get some wonderful artery clogging items into their systems.
The old way isn't necessarily the bad way, either. For lard, substitutes such as Crisco, loaded with the now dubious trans fats were created. We all know now about the issues associated with trans fats - so was cooking with lard the "healthy" way after all?
Of all of the items I saw at the Titanic tourist trap, I liked the menus most of all. We will be studying the first class menu, which is where all the rich people were staying on the Titanic - for BIG money. I can't remember how much a passage across the Atlantic was in first class, but if memory serves it was well into the five figures in todays dollars. So these people were the elite and this is what they ate. Lord knows what they ate in steerage. This menu is from April 12, 1912 - the Titanic sunk on April 14, 1912.
You will note the distinct British flavor of the menu - many of the links you see are from British and Irish recipe sites.
Without further ado Madames et Messieurs, I present your menu for today for the RMS (Royal Mail Ship) Titanic for your culinary pleasures.
Consomme Payeanne - I had a hard time with this. I know what a consomme is, but not the word "payeanne". I didn't remember what it was from my college French courses. But my google fu is strong - I found a salad payeanne at this restaurant ($8!). The ingredients in it besides the lettuce are smoked bacon and parmesan. Sounds like a Consomme Payeanne would be a bacon based consomme. Yum! Or you could select the Pea Soup. Geez, I wonder which I would pick. Although upon thinking about it there may have been problems getting good tasting peas (or any good veggies) to people back then and it may have been a delicacy - something to think about anyway.
Fillets of Whiting - the Wiki for whiting explains something that I just touched on in the early part of this post. Here is the quote:
The whiting is an important food fish in the eastern North Atlantic, northern Mediterranean, western Baltic, and Black Sea. Until the later twentieth century, it was a cheap fish, regarded as food for the poor or for pets, but the general decline in fish stocks means that it is now more highly valued. The other fish that have been given the name whiting are mostly also food fish.So in 1912 the whiting was served on the most elite of tables in the world, then was fed to dogs, and now is starting to be more highly valued. Can anybody please tell me why more people are not interested in history? This type of stuff fascinates me. Anyway, here is photo of some whiting for you - they don't appear to be very large.
It would be interesting to see how those were prepared on the Titanic.
Next is the Omar Pacha Egg. Yikes! Never heard of that, but I found a recipe in an old textbook for it. CHECK THIS OUT:
Melt a little butter in a dish that can go into the oven. When heated, break in twelve eggs, one beside the other, keeping the yokes whole. Cook in a moderate oven for five or six minutes. Fry in butter two ounces of chopped onions and two ounces of chopped green peppers. Add three gills (one cup = two gills) of tomato sauce and half that quantity of half-glaze sauce (not sure what this is but I bet it is good) and white wine. Reduce, not having it too thick then add bacon (prepared by mincing non-smoked bacon - fry it in butter), moisten it with gravy and Madiera wine then cook and reduce the moistening entirely. Pour this sauce over the eggs or serve in a separate sauce boat.
Pardon my french, but I say to the Omar Pacha Egg dish - HELL YEAH bring it on! Couldn't find a picture of this dish, sadly. By the way, here is some information about Omar Pasha himself, the person the dish was named after.
Welsh Rabbit (sometimes called rarebit) - not what you think! We aren't eating Bugs Bunny here, but how can you not like something made out of cheese, beer and butter?Haricot Ox Tail - Well I know that haricot is "bean" in French (I always laugh when I see "haricot verts" on a menu at a restaurant - can't they just say green beans?) so I assume it is an Oxtail preparation with some sort of beans. I would bet it was probably a stew of some sort. Lets once again try to find a recipe. Aha I did find it - listed as a historic recipe. Looks yummy.
Boiled Chicken in Bacon and Parsley Sauce - pretty self explanatory here.
FROM THE GRILL:
Grilled Mutton Chops - I assumed the word mutton back then was used like today to designate lamb, making this dish lamb chops. But later on the menu you will see lamb with mint sauce. So they must use mutton here to designate a sheep, rather than a baby sheep or lamb.
Mashed Sotay and Baked Jacket Potatoes - I think sotay is a bastardized word that means sautee. So that would mean you have two potato choices, either mashed and sauteed or baked. I believe that "jacket" used to mean the result when you baked the potato, so it seems a little redundant that they would put both in the same description, but maybe that is how they described them in 1912.
Tapioca Pudding - self explanatory and yummy.Greengage Tart - I had no idea what this was, but then I found this page that describes it perfectly. I would love to try it someday - I love plums. Here is a photo of Greengage plums.
Also there looks to be a selection of pastries.
Are you full yet? No? Then lets take a look at the buffet shall we?
Mayonnaise of Salmon - This is another recipe I had never heard of, but found this old recipe and can just imagine how good this tasted on the Titanic. Oh my god how easy - you just poach the salmon in these ingredients:
- 2/3 cup dry white wine,
- 1 tablespoon vinegar
- 1-1/4 cups water
- 6 peppercorns
- 1 fresh parsley sprig
- 2 teaspoons salt
- 1 pound fresh salmon fillet, skinned
- 5 tablespoons mayonnaise
- 2 teaspoons Dijon mustard
- 1-1/2 teaspoons finely chopped gherkins
- 1-1/2 teaspoons chopped capers
- 1-1/2 teaspoons chopped fresh dill
- 1-1/2 teaspoons snipped fresh chives
and then fold in some dill after flaking the salmon and serve - I WILL make this someday.
Soused Herrings - Well, I know what a herring is - I love eating creamed herring out of the jar on a cracker. Lets find out what "soused" means. Oh YUM - check it out here for the recipe.
Here is a photo of a soused herring sandwich from this site. I wonder what the presentation would be on the Titanic. By the way, I would eat this every day for lunch if I could get my hands on it here. Potted Shrimps - Oh my god does this sound good. Shrimp encased in clarified butter? You have got to be kidding me! I found a photo too.
Plain and Smoked Sardines - pretty self explanatory.
Roast Beef - self explanatory as well.
Round of Spiced Beef - Hard to say exactly what cut they would use for this, but probably a prime rib I would guess.
Melton Mowbray Pie - Another one I have never heard of. But holy crap look at this! A pastry stuffed with pork, bacon, spices and eggs? I will take a serving - large please. It would be served cold during the summer after a long day of fox hunting perhaps in the English countryside. I would like to make this, but it looks like a lot of work. It would probably be worth it - here is a photo.Heaven has Melton Mowbray Pie served at the entrance, apparently.
Lamb with Mint Sauce - self explanatory.
Virginia and Cumberland Ham - also self explanatory. Interesting that they actually would get ham from the colonies rather than their own from England (the Titanic was leaving England at the time, bound for New York). We must have had a "leg" up on them in the tasty ham department.
Bologna Sausage - also self explanatory.
Brawn - what is this? Never heard of it. Lets take a look...I can't describe it - you have to read it yourself. Here it is, from this page. You better believe I would be consuming my share of it.
To a pig's head weighing 6 lbs. allow 1 1/2 lb. lean beef, 2 tablespoonfuls of salt, 2 teaspoonfuls of pepper, a little cayenne, 6 pounded cloves. Cut off the cheeks and salt them, unless the head be small, when all may be used. After carefully cleaning the head, put it on in sufficient cold water to cover it, with the beef, and skim it just before it boils. A head weighing 6 lbs. will require boiling from 2 to 3 hours. When sufficiently boiled to come off the bones easily, put it into a hot pan, remove the bones, and chop the meat with a sharp knife before the fire, together with the beef. It is necessary to do this as quickly as possible to prevent the fat settling in it. Sprinkle in the seasoning, which should have been previously mixed. Stir it well and put it quickly into a brawn-tin if you have one; if not, a cake-tin or mould will answer the purpose, if the meat is well pressed with weights, which must not be removed for several hours. When quite cold, dip the tin into boiling water for a minute or two, and the preparation will turn out and be fit for use. Time-from 2 to 3 hours.
Bring on the brawn!
I suppose you would spread it on a cracker or something. This reminds me of a dish my grandparents (German) used to serve, maybe it was a version of this.
Corned Ox Tongue - I love beef tongue, but have never eaten ox tongue. How bad could it be? Probably very tasty. Here is a cool page I found that has a photo of an ox tongue sandwich and a review too. What the heck, I will post his photo up so everyone can see the ox tongue sandwich.
Lettuce/Beetroot/Tomatoes - I would assume, again, that only the finest produce would be found on a trip like this, and I bet those tomatoes were big, plump and red. I still can't get a stupid decent tomato around here unless I pay a gazillion dollars for the hydroponics that are offered at the store.
Cheeses - funny, Kim du Toit just took us americans to task for not having a cheese course as a dessert and I fully agree. NOTHING is better as a dessert for me than small servings of high quality cheeses after dinner with a good port or scotch. Whenever I see a cheese course offered at a restaurant for dessert I am all over it.Time for the men to adjourn to the smoking room for a brandy and cigar and for the women to go to their quarters as well. Whew! Now THAT'S eating! Well worth the price of admission, I would have to admit.
Wednesday, March 21, 2007
We walked past the line of buses outside the United Center. As I walked by, I smelled the distinct aroma of fuel. I looked at the side of the bus, which was idling and full of people, and could see that it was clearly leaking gas, and not a little, but a lot. I talked to the CTA driver milling out front and said, hey, look - the bus is leaking gasoline - this has to be dangerous.
He looked at me and slowly drawled "it isn't gas... it is diesel" and stared at me. After a while, he mosied on over and started talking to the bus driver, about the situation.
Note - for those sticklers out there it was too frickin' cold on Friday to take a picture and it was kind of dark so this is the same bus lined up on Sunday afternoon. I really wish I would have gotten the shot of the actual leakage, like I missed the CTA employee with his back against the wall while repairing the subway tracks as the train went by
Tuesday, March 20, 2007
My daddy taught me the first two, but I learned the last one the other day. I’m sipping a beer, watching the NCAA tournament with a couple of folks in my local watering hole.
Between games the discussion wanders to boats and fishing. (The lake ice looks like it’s about ready to come off and it’s been a cold winter.) Bill brings up the old canard that the water levels in the great lakes are low right now because Chicago is sending too much water down the Chicago river.
Being an ex Chicagoan, I defend Chicago. “The amount of water going out the Chicago River is diddly squat compared to the water going over Niagara Falls” I state between beer sips.
Bill replies with a rather unique theory of geography. According to him, water flows down the St Laurence INTO the great lakes, eventually flowing out via the Chicago River, the Illinois and Mississippi into the Gulf of Mexico. Bill ought to know better, but as proof he quotes the old grade school rule, “all the rivers run south to the ocean.”
I should know better, but I crank up by mouth and argue with him. And then, I’ve suddenly got Charlie and Jim into the discussion, and they all agree I don’t know diddly. Jim brings his AAA road atlas in from his car and starts pouring over the maps. He has a hard time finding Niagara on the map.
We discuss the St Laurence Seaway. Jim finds the St Laurence River on the map. The St Laurence goes NW to SE. According to Bill, that means that the water in the river flows to the SE.
I make one more futile try. “What’s the altitude here?” I ask Bill. “About 1000 feet” he replies. “So how does the sea level water at the mouth of the St Laurence manage to climb up 1000 feet or so to fill the great lakes?” I ask. No reply.
The “discussion” went on for some time. Bill knows he’s right, Charlie hasn’t changed his mind once in 65 plus years, and Jim is still studying his map. It’s futile, but I’m ready to die trying to help just ONE Geographically handicapped cheesehead.
Eventually they left, Bill shaking his head, Jim still looking at his map. Charlie lives right across the street, so I can’t dodge him. But by this time, I’m not in a mood for basketball anymore.
Maybe I’ll learn.
Next time some Cheesehead tells me that Vince Lombardi discovered America I’m just going to nod my head and agree. It’s much easier on the blood pressure.
Monday, March 19, 2007
It being the New York Times, and me being as mistrusting as I am of most mass media, I highly doubt that the reporter did any large amount of real research. The article is fairly light hearted, and makes the usual generalizations as most articles of the like tend to make. I like this quote:
“The hot tub is my favorite part,” says Weston Selman, 20, a biomedical science major at Texas A&M University.
And some parents are willing to pay as much as 50 percent more than the cost of a comparable campus dorm room for a private room in an outsourced, off-campus “dormitel.”
And here is the room I and another guy lived in:
Yes, two beds had to fit in there along with all of our worldly possessions - one of us had closet "a" and one had "b". We even had a party or two in there once in a while, if you can believe that. My first roomie and I partied pretty hearty, but he joined a frat and moved out. My second roomie was a Korean fellow that was a devout Bible thumper - I drove him crazy in about two weeks and he bailed. That left me with a single room for most of my sophomore year - one guess as to where most of the parties and other carnage happened after that.
Fortunately each floor had a lounge, which, on our floor at least, became strictly a card playing facility. Here is the floorplan of Oglesby 4 if you are interested. I am hotlinking a pdf at the U of I website, which is bad form usually, but my folks paid enough tuition to them so they can at least suck up a little bandwidth for me.
That was a long time ago. One thing I do remember is that we set the record (and probably still hold it to this day) for the amount of fines levied on any floor at the U of I at any time for damages. I simply cannot imagine what we would have done to those "dormitels" at DePaul if we lived there. I can guarantee but one thing - it would have been ugly.