Monday, June 30, 2008

Are we really that sensitive?

Gen. Wesley Clack recently questioned how McCain's Vietnam experience relates to being president, raising a valid point that no one event, or experience automatically makes you perfect for a specific job. Suddenly McCain is condemning the remarks, and Obama is distancing himself from a potential VP candidate. Why are we suddenly so sensitive, that we immediately condemn a reasonable question, instead of answering it.

Clark made a valid point, even if he went around it the wrong way. McCain's time in Vietnam does not automatically qualify him to be an expert on foreign relations and nation security. Being a former navy pilot does not give you the right to be president. Why then is everyone acting like Clark was waging a personal attack against McCain?

We as a society, are becoming far too sensitive. We see something that might be considered offensive, and immediately reject it as being hateful or disrespectful. In this day of PC, we need to step back and look at how crazy we've all gotten if we cannot open our mouths without worrying that we will be ostracized for speaking our mind. There is a difference between open questions and attacks.

All McCain had to do was say that he's got all this other experience that allows him to be much more knowledgeable on topics such as the war in Iraq. Instead he took some kind of personal offense that he did not have the right to be president because he was a POW. The media helped fuel this controversy by playing into it. They're always looking for the next big story, and in a week where candidates would normal just trade barbs over the economy and climate change, they saw a chance to make some headlines. It is becoming almost a weekly occurrence to have a big story, that isn't really a story at all. I wonder if those reporters are ever going to see the light and realize they are cheapening their own profession.
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Wednesday, June 18, 2008

Local Action, National Microcosm?

In Wichita, Kansas (pop. roughly 3-400,000) an interesting request has come before the local City Council: a loan. Local business man, Bill Warren, is asking the City of Wichita to grant him and his movie theater chain, Warren Theatres, for a six million dollar loan to help him offset the loses of his destination theater in the middle of a recently redeveloped section of downtown Wichita. The City of Wichita approached Warren early in the stages of redeveloping what is now called "Old Town Plaza" requesting that he build a theater there to be the main tenant of the new area hoping that the theater's local popularity, and relatively high caliber would attract other tenants to the area. It has been about five years since the "Old Town Warren Theatre (LLC)" opened for business and, along with other tenants in the area the theater claims to have been losing money since day one.

The money Warren hopes to borrow at a low interest rate (no interest for the first five years, 1.25 percent for the remaining five) will be used to renovate the Old Town Warren. Removing the "Oscar" bar which has done poorly due to many other more accessible drinking establishments in the area and putting an additional auditorium in its place. Thereby cutting the loss of the bar in favor of a potentially increased variety of movies that the relatively small (currently only six screens) downtown destination can offer. The six million would also go to pay for digital projection and sound equipment as well as expanding the food services offered to include a banquet room. The Warren family of theaters and restaurants (located within the theaters) have been good to Wichita and its citizens. Providing many diverse jobs, and top rate theaters for years now, and Wichita has been good to Warren. Warren started in Wichita and has since expanded to neighboring states Missouri and Oklahoma. Is it the duty of the taxpayers to take on the burdens of a local business man?

While most see the Warren theaters as an asset to the city and a great place to see a movie, and maybe get a bite to eat. Others see it as a locally grown monopoly. Many "small" theaters have been forced to close or be purchased by Warren simply because his theaters were able to very successfully dip in, way in, to their customer base. Now this type of rise and fall is simply free market economy, but people, and economies, almost always tend to be at loss for the passing of a local "ma and pa" run business.

The whole situation begs the question of who the responsibility for this should fall on. Should the city handle what could be seen as a poor development move in encouraging the wrong kind of business(es) in the wrong part of town? Should the businessmen assume the loss they befell their investment? Should the taxpayers and patrons have a say? First things first, as a country partially founded on the outrage of taxation without representation it should be no question that the taxpayers should have some say. Is simply picking a city council member to stand behind adequate representation? Or should the loan go to a general vote so that taxpayers are given a chance to either decline or support a single company's request. In the free market a consumer is given the choice of which product to buy and from which company. If one does not like a product for any reason or a company for its actions or investments they have the right to take their money elsewhere.

In Wichita there are many opposed to the Warren because of their relative control of price and content over locally shown movies, and these opponents who are unwilling to give their money freely may also be unwilling to give it via council approved spending even if they support their council member. It could be that the movie goers have chosen to boycott the Old Town Warren for one reason or another. If this happens to be true can, and should the City override what its citizens have already decided? The City has spent nearly ten million to develop the area this theater is in, and did as the theater to build their. If the theater is forced to close, and presumptively the area fails with it, the city will likely be unable to retrieve their investment to repay the bonds used for the development meaning a huge loss for taxpayers. Not only is the money lost, the area is as well.

Considering the City's initial ten million dollar investment maybe they have done all they need to in making the area welcome to these business men and women and it should now be their responsibility to save their own loss. No one forced the theater to build there. I am not certain but I do not believe that any incentive was offered other than a public plaza and improved public streets and parking for the theater to build. The investors took a risk and lost. That is the investment game after all. Maybe they should take this all back upon themselves and try to find a solution not involving tax dollars. However, if the City does award the loan the theater would agree to stay open in its current location for at least ten years, the life of the loan. Also the City will be first on any foreclosure or bankruptcy claim should the loan fail to stymie the decline.

A further question to ask is, "What if National Government worked this way?". Well what if? What if a failing national, or international company could ask the federal government for a loan to supplement their profits or the lack thereof? In a few situations this is the case. Take "Big Oil" for instance. Congress has been fighting for months over whether or not to remove the tax cuts and levy additional taxes on oil industry leaders. Are the current tax breaks, which the companies claim they need to compete globally, anything like the six million dollar loan that Bill Warren and his business partners are asking for? In what is supposed to be a free market economy, where success or failure is in the hands of the American consumer, should the government, local or federal, be awarding money to individual companies to help keep them afloat? Or should our governments simply be setting general economic guidelines like taxes on industries and companies that harm the health or security of our nation and planet; laws against what can and cannot be in food, clothes, or children's toys; incentives for companies that help America become more independent in more than just energy but natural resources as well; tax breaks for companies that increase our standard of living by keeping jobs here and the nation and our planet clean? The days of laissez faire economics are over.

People have demanded safeguards for food and medicine (the FDA), a clean world to live in (the EPA), safe places to work (OSHA) and many others. This does not mean that a free market is, or should be, out of the question. The government does the work of the people, all of these agencies and the rules they have laid out we, as voters and consumers, have asked for in one way or another, or at least we accept them. These organizations keep corporations making better, safer, cleaner, more efficient, easier to use products. Progress that, if were left totally up to the laws of demand, may take years. The government's role in the free market should be to lay the ground rules. Encourage what we the people want, and discourage what we the people are sick of. It is hardly a free economy when a company's loses are being bought off by a city, or a corporation's profits not subjected to the same taxes as others. The consumers should decide what the profits and loses of any given company look like. The government need only assure that the products brought to market are in the best interest of the nation and the world.
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Monday, June 16, 2008

How candidates deal with fuel prices

Price of gas is well over $4 where you live? Join the rest of the country. It's starting to affect everything from the cost of grain, to the cost of steel. Since the oil crisis of the 1970's, we have based our entire economy on petroleum. For the previous quarter century, oil was cheap and easy to use to keep our country moving. That is no longer the case. We're going to extreme lengths to get oil, from squeezing it out of sand in Canada, to setting new records for deep water drilling. The new extremes coupled with the shortage of refinery capacity and the unending appetite of the planet for fuel have cause a crisis that may go beyond $140 oil.

So what can we do? McCain continues plead for his gas tax holiday, but recently has suggested a new plan. More drilling in our backyard. This would provide oil from some of the most secure source in the world, while also providing new sources of income for American companies and that states they drill in. While he suggests drilling more off our coastal waters, he is still opposed to drilling in Alaska, giving a good view of both sides of his coin. This basic rhetoric, of more domestic drilling to provide energy security and lower prices, has recently been touted by Dick Cheney. McCain also supports development of alternative and bio fuels.

Obama has made reducing dependence on foreign oil, and oil in general, a core to his campaign. By supporting not only the recently passed increase in fuel economy for vehicles, but also increasing those fuel standards and helping US automakers in achieving them, his plan would reduce overall oil consumption. This is in stark contrast to the way McCain has behaved by skipping many of the important votes on environmental bills. Both Clinton and Obama made the effort the return for those votes, even with their busy pre-primary schedules. McCain's answer has become increased production.

Unfortunately the suggestion that drilling in the US will lower the price of gas and oil is far from reality. Recent studies have shown that even drilling the massive oil reserve of Alaska would only bring down the price of oil by potentially 1% by 2025. Now if the price of oil reaches $200 like some major economists believe, that would be a whole $2. If you consider how much oil we might have, we might be able to bring the entire country's price down 5-7%. That is only if we started drilling everywhere we have oil in the next 5 years. Given many oil companies' lethargic attempts to increase production and capacity, I don't see that happening.

Since we opened the oil markets, crude oil has become a publicly traded commodity. This is why, even with the recent announcement of Saudi Arabia's increase in production, the price of oil will not drop significantly over the next 6 months. Consumption is starting to slow in the US, as people take more public transportation and move away from large SUV's, but not fast enough to make a dent. This long term price increase would theoretically give rise to alternative fuels that are too expensive for $50 oil. We should take advantage of this time, and the public's dissatisfaction with the price of gas to develop ways to get ourselves off oil. In 30 years we will be short on places to find oil, and petroleum fuels will skyrocket.

This is why short term solutions won't work. We need to invest in technologies that may not be ready for 5-10 years, but that will help remove oil from our dominant fuel by the time it starts running out. The side benefit to all this is that we can combat global warming at the same time. Sadly, it seem that McCain may only be providing the body of this country a band aid for a broken bone. I suppose it is still better than Bush's wait-and-see attitude, hoping it heals itself.
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Wednesday, June 11, 2008

Economic Bickering

Obama and McCain have been going back and forth the last few days, arguing about whose policy is worse for the country. Obama says that letting the Bush tax cuts continue past 2010 would just give more money back to corporate bigwigs and the richest parts of America. McCain says they will give American companies the ability to compete on a global scale, keeping good paying jobs in the country. McCain also says that Obama's tax increases would amount to the largest tax increase since WWII, and would hit middle class families and business owners, even some low income families. What's the average person to do?

Well, pull your head out for starts. It's basically been proven, that no matter how much money or tax breaks we give to big companies(or the people that run them), they're going to keep sending jobs to India or Mexico as long as they can bring the goods back into the country cheaply. Obviously part of the solution needs to be fixing our import/export system so that we're competitive with the lower production costs of foreign workers. Continuing the tax breaks already given, won't get our jobs back any faster. Unless we start moving to Vietnam.

There is some concern about Obama's plan hitting middle class and small business owners. If you actually believe that capital gains tax increases will hurt low income families, go down to your local "projects" and ask to see their investment portfolio. The small businesses and middle class families would be mostly covered by new tax breaks and amendments to the AMT. Which is even now ensnaring many of these same people as the Bush administration sits on its hands.

McCain's proposed extension of the Bush tax cuts, as well as a general repeal of the AMT, would cause a $300 billion reduction in revenue for the government(how do you keep funding a war by throwing away that much money?). Obama's modest(they may be the largest dollar amount, but any economist will tell you that percentage of GDP matters most, and this is ranked 5th since 1943) tax increases for big business and the people who run them would be dumped back into the economy for investment in health care and renewable energies. Both of those would represent a huge savings to the entire country if health care costs were down and energy wasn't brought by tankers into this country from places like Iran.

Really, the "trickle down" approach to taxation will not help solve our economic problems. Giving the money to the top will hardly make down the hill as everything on the way down takes its "share." McCain claims to want to give the free market a chance to fix the economy on its own, without government interference. We did that for 7 years and it has put us in the worst economic downturn in maybe 30 years.
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Sunday, June 8, 2008

Clinton steps out, keeps the spotlight.

Hillary Clinton finally announced that she was suspending her campaign. Most people saw it as a chance to mend ties and make sure that her avid supporters are lead into the Obama fold. She kept repeating that they should "elect Barack Obama the next president." Obviously she either realized, or caved to the party leaders, that she needed to thoroughly endorse him. Really she just spent most of the time blowing her own horn.

I'm not a sexist person, I never felt like Clinton didn't deserve to be the nominee. I just liked Obama better. Some people would say that the media gave the nomination to him, but in reality he won it fair and square. Michigan and Florida had violated the rules, and that should have been a non-issue. There were some people who obviously had issues with Hillary as a woman (read: Tucker Carlson), but I think that most Americans have no issue with a woman as a leader. Many would even welcome it.

That leads us back to the speach this weekend. Hillary was there to endorse Obama and thank her supporters, while carefully ending her campaign. She spent most of the time talking about how great it would be to have a woman president and how great she is. She managed to squeeze in a few things about Obama being the first black nominee, but from my computer, it was all about her. She was respectful of Obama, but she did little to try and sway the woman's groups that are refusing to support the Democratic nominee.

Then there is the VP debate. Is Hillary a help or a hinderance? I think in the situation that they have been through, she is easily both. She would bring with her a large group of rabid supporters that would do what she asks like people buying books from Oprah's list. On the other side, she has been a very devisive character and has burned many bridges with friends and collegues. It is not a thought to be taken lightly, and the Obama campaign has clearly said that he will take his time. There are plenty of potential VP's and they all have pluses and minuses.

At least now this chapter over. Potentially. I think we haven't heard the last of the sexism debate, but that it will fade away quickly as the focus drifts to the fall elections and the fight with McCain. It will be interesting to watch this play out. McCain has been trying to paint Iraq as a neccessary war on terrorism, while distancing himself from Bush and his policies. The recent disaster of the climate change bill in congress will hang a noose around some necks, and it will be up to the voters to decide in November if they should pull the rope.
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Friday, June 6, 2008

Simplifying the complex?

I'm going to start this political blog, if only for the fact that things are going crazy in the world right now, and most people have no idea what is happening and why. I will try to stay objective, but be warned, I hate stupidity.