Friday, November 27, 2015

Trump... Maybe Not A Chump

So when I first heard that Donald Trump was running for President, I laughed. Trump? The loudmouth with the toupee made form his own real hair? Get outta here... you're fired!

Then I figured out he was serious. Which made me kind of angry. The Republic is too serious an issue to go grandstanding. We don't need loud-mouthed billionaires playing politicians. After seven years of Barry O, we need Statesman.

The funny thing is, the more outlandish an idea sounds, the more carefully you should consider it. Trump has shown something none of the other candidates have - self confidence. Anyone else who had made his string of gaffes would have bowed out under pressure by now. Trump just moves on. In fact, nobody has been able to make any controversy stick for long, and Trump has even turned a few around to his advantage. That kind of leadership is rarely successful in Washington circles, but then again the Washington circles aren't particularly successful outside of America.

Then Trump started launching his "plans" - his planks for his platform. The first one was immigration. The next few - 2nd Amendment Rights, Tax Reform, VA Reforms and US China Trade Reforms - aren't issues anyone is actually talking about. The funny thing is that this isn't the Donald being out of touch. This is the Donald saying "look, these are issues I think are important, and here is how I plan to address them." I have to say it's refreshing to see someone finally not sticking their finger into the air to figure out which way the wind is blowing.

So sufficed to say, I've been taking Trump much more seriously lately. And so have a lot of other people. The media assault on Trump has been going strong, with the establishment right and entire left wing frothing at the lips to strike any blow they can. And since I completely disagree with all of those people, I have to say a Trump Presidency is looking more and more attractive. The man clearly has executive experience - he's created a multi-billion dollar empire for a few million in initial capital. He also has leadership experience - pulling together multiple individuals from diverse backgrounds for his business ventures. But lastly, Trump's thinking is the exact opposite of the Washington insiders. Whereas candidates like Bush, Fiorina, Christie or Cruz hired huge teams of lawyers, lobbyists and PR firms, Trump hired a few key individuals to run his campaign. While other candidates struggled to convert cash into basis points in the polls, Trump used free media exposure to preserve his capital. While other campaigns floundered under the weight of their cost structure and hemorrhaged money from the coffers, Trump spent only what he had to.

At this point, I have decided that a Trump Presidency couldn't be any worse than any president we've had over the last 27 years. Not Bush 41, not Clinton, not Bush 43, not Obama. There can be two outcomes - either we watch the nation finally hit bottom instead of just swilling about, or we truly Make America Great Again. Either way, I'm down for whatever.

Thursday, September 17, 2015

My Post Debate Analysis

I didn't get to watch the full debate last night, so I missed at least one juicy exchange. However, last night's CNN Republican Presidential Debate (hardly the correct term, since they're not even nominees yet, much less President) saw a fairly dramatic and certain shift in how candidates present themselves. First, I want to call out winners and losers.

Winner: Carly Fiorina. Fiorina did not get the exposure of the previous debate, and was absent from much of the dialogue of the national press. However, for people who follow politics, Fiorina tore up the post-debate sunday talk show circuit. That earned her a post-debate bounce in the polling that got her up as high as a 6.3 share. This gave her leverage and her supporters earned her the right to sit at the grownup table. She siezed that opportunity to present herself as a strong woman who isn't a bitch. She also showed what a smart lady she was, effortlessly talking to domestic issues but also presenting a bold, strong foreign policy perspective. Expect her numbers to grow rapidly in the first few post-debate polls.

Loser: Trumps braggadocio fell flat last night, partly because Trump was clearly trying to restrain himself, but partly because Trump could not defend some of his ad hominem attacks against his fellow candidates. Other candidates like Paul and Christie were quick to seize on them and take the high road by asking for a higher caliber and higher class debate. When it came time to answer for his "look at that face" gaff towards Carly Fiorina, Trump could not articulate an excuse. (Fiorina, for her part, avoiding any petty back-shots and kept her head high, though she did show a touch of anger over Trump's attack against her career record and Christie's attempt to undermine their private sector experience.)

Winner: Huckabee is not a strong candidate outside of evangelical circles, but last night his impassioned defense of the rule of law over judicial activism won him strong accolades. On the arrest and incarceration of Kim Davis. Huckabee's argument that she shouldn't have been jailed. It was that we should respect her 1st Amendment Rights (free exercise of religion), and make provisions that balances her rights with the rights of gays to get married. This is a balanced approach that most people probably hadn't considered. Based on that and other elements of his performance, you can expect Huckabee to enjoy a brief bounce in the polls.

Loser: Bush brought a little more life to his performance, but mostly spent his energy on Trump (who he was strategically positioned next to). He made a few key, noticeable gaffs. When confronted by Trump on how he routinely speaks Spanish during pressers (which Trump tried to imply was pandering to Hispanic voters, especially by putting the challenge in the middle of an immigration topic), Bush responded that if he's asked a question in Spanish, he's going to show respect by responding in Spanish. That did not play well with elements of the crowd. Someone should tell Bush that this "press 1 for English" business is bad enough on the phone, but it won't endear him to his base. Later on, there was an exchange in which Bush defended his brother's legacy in Iraq, something that will most definately draw howls of derision from the left, but will also not gain him much love from the center. Even many on the right widely regard his prosecution of the Wars in Iraq and Afghanistan as plagued with errors, and would rather move past it. Finally game a portion of the debate where Bush's past marijuana use became the topic of discussion. Rand Paul managed to play Bush into a trap where Paul was able to make the case for his platform that America's drug laws are unjust by pointing out that Bush got special treatment due to his wealth and status whereas poor and minority offenders face incarceration and life long criminal records.

Loser: Christie simply came across as crass and authoritarian. In the few moments where he was able to steal the spotlight, he tried to minimize other candidates' record, but his response was simply to harken back to 9/11 and his yearly years as governor. Christie's more recent record include things he doesn't want to talk about, such as the Bridgegate Scandal or the high visibility hugfest with Obama.

Winner: Carson brought something to the debate none of the other candidates can manage - a sense of calm, even-tempered and thoughtfulness that usually doesn't play well. In his case, however, it seemed to create an air of focus around his responses. Even other candidates were reticent to interrupt Carson, and instead listen to his responses.

Loser: Everyone I haven't mentioned yet. Rubio spent most of his airtime looking sweaty, which unfortunately distracted from some excellent points he made. His youthful appearance leaves an impression of inexperience, which really isn't fair because he has good ideas. Rubio has the chance to channel the Kennedy charm, but his window to do so is shrinking fast. Kasich didn't help himself out of the "establishment" bucket with his "go along and get along" mannerisms. Kasich did make the case for being Secretary of State or possibly Secretary of Defense, however. Ted Cruz's makeup team should be beaten for once again making him look like a transgendered doll with greasy hair and pink lips. It was hard to pay attention to anything else when you're trying to figure out why he's in pink lipstick. (To be fair, his overall performance in this debate was weak and scripted.) Scott Walker likewise failed to impress, and the only memorable moment in the debate was when he clashed with trump.

Then there's the kiddie table: George Pataki, Rich Santorum, Bobby Jindal and Lindsey Graham. Santorum's performance was simply awful, and we can expect him to fall of the debate in coming days. Pataki didn't do much better. Frankly, if you're at the kiddie table, you should be thinking about your short term prospects in this race anyway. Lindsey Graham fared better with his humor and substance, but lacked passion for much of the debate. Then there's Bobby Jindal, who should be more popular, and his performance last night may give him the opportunity to be at the adult table in the next debate.

Winners: Outsiders - those people who have for years complained about professional washington politicians now have a real choice. Governers Pataki, Walker, Jindal and Christie have outside-the-beltway credentials. Tea Party Favorite Tex Cruz can actually speak to taking on the federal government and winning (as can Jindal). Walker can speak to his record as a union buster who works for the people. Taking it another step, you have Trump and Fiorina, with proven track records of success (and, admittedly, failure) in the private sector, as well as Ben Carson, the self made man.

Losers: Illegal immigrants, who will find no quarter among the GOP slate. Also, Hillary, who can count no friends among this crowd. Reince Priebus, who is seeing his grip on the reigns of power slipping as Jeb continues to tank.

Finally, I have to recognize CNN. CNN's choice of backdrop - the former Presidential Airplane, symbol of American Power visa vie the Presidency - was the perfect reminder of what we're ultimately getting to with these candidates. Siting the debate at the Reagan Library is the perfect throwback to where we were 37 years ago, which is nearly the same position we're in now: in conflict with an Islamic state, terrorism and the threat of Russian militarism as we discuss how best to replace a weak, ineffective and disastrous Presidency to restore American greatness. Moderators Jake Tapper, Hugh Hewitt and Dana Bash for not only asking great questions, and not only for keeping the candidates in line, but also not letting the candidates steal the show with their flagrant disregard for the rules of debate or each other.

Friday, June 19, 2015

Emile Leray: Certified Badass

Let's say you were driving along one day, and your car broke down. Would you be able to fix it? Would you be able to hike to the nearest place and use their phone to call for help? Or would you flag down a passerby? But before you answer, let's specify that you were driving along one day in the Morroccan desert - one of the harshest climates on earth, and the nearest town (which might not even have a phone) is 20 miles away across burning desert. Emile Leray had that happen, and he said "fook zat", and just built a new vehicle from the parts of his old one.

Thursday, June 18, 2015

The Price of Quiet Racism

Racism still exists. It's not the out-in-the-open form of racism we used to see. It's closeted. Instead of white-sheeted marchers in holiday parades waving the Confederate Battle Flag, it's the wink-and-nod variety.

Tuesday, June 09, 2015

Rise of the Machines: Fall of the Middle Class or Rise of the Poor?

There's a simple concept in capitalism that any improvement in efficiency as a result of technology results in a net improvement in welfare for consumers. Initially, those improvements mean higher profits for manufacturers. However, market forces quickly push the benefit to consumers in the form of lower prices and improved quality. This concept has been proven time and time again. A great example is the famous Ford Model T. When introduced in the mid 1920's, it sold for $850, making it affordable for the majority of Americans. (Adjusted for inflation, that's about $12,042 in 2015 dollars). However, improvements in the assembly line and tooling process drove the price down to $250 ($3,541 in 2015). More than fifteen million Model T's were produced.

A common argument people engaged in protectionism make is that regulations should protect jobs. Therefore, new products or processes that reduce demand for labor need to be regulated. From 1925 to 1930, as Ford introduced new production methods, not one single worker was let go as a result. In fact, more were hired to support expanded production. A more affordable Model T meant more demand. Additional profitability also meant higher wages for works. 100,000 of those Model T's were sold to Ford employees at retail prices.

Granted, there are cases where technology eliminates jobs. The Ford Model T decimated the horse whip industry. Carriage makers turned to making automobile bodies. Nobody needed to whip their horses any more, so these coach builders no longer needed leather straps, leather whips or other leather accoutrements. Had the shrillest voices of the day prevailed, there would be regulations requiring cars to be sold with horse whips. (I kid you not.)

Rich people tend to be the worst, particularly when their conscience catches up with their avarice. Robber Barons of the Guilded Age quickly switched over to being philanthropists, spending vast swaths of their fortunes (much to their heirs dismay) on social improvement schemes ranging from libraries to endowments for the arts. Unfortunately, lessons aren't always learned. For every Henry Ford or George Westinghouse, there were 10 industrialists who exploited markets - often with help from State and National lawmakers - to amass huge amounts of wealth without giving more than a passing thought to other stakeholders in those markets. Then comes the day when, from the couched luxury of their corinthian leather office chairs behind rainforest mahogany desks in opulantly decorated corporate suites, they criticize the inequal distribution of wealth between the elite rich and the swelling multitudes of poor.

My new favorite self-loathing elitist is South African multi-billionaire Johann Rupert, who warned that the rise of the machines will result in social unrest as robots and AI replace low skilled laborers. He also laments the destruction of the middle class, which further increases the divide between rich and poor. His argument is that social unrest will follow, as resentment from the poor will be countered with fear and suspicion from the rich.

There are several arguments with Rupert's mode of thinking. First, is that the middle class has always been fluid. It is not growing and shrinking per se, but what is happening is that the level of mobility  between the middle, upper and lower classes is changing. Certainly, the financial crisis and great recession has forced much of the middle class into the lower classes. But it has also made more rich people, as those whose assets were not dependent on financial markets were able to quickly recover. In 2007, just before the onset of the financial crisis, 9.2 million US households were classified as millionaires. That fell to 6.7 in 2008, but by 2013 had recovered to 9.6 million households. If you're wondering what happened to the 2.5 million that stopped being millionaires? They slid into the middle class. Unfortunately, the middle class shed some 4.1 million households to the ranks of the lower class.

I don't want you, the reader, to get hung up on these levels, mind you. They're relative. The  middle class is defined as those households whose incomes fall between 0.5 and 1.5 times the average household income. A millionaire, on the other hand, is defined as someone who has at least one-million-dollars in assets. It's actually pretty common for someone with a million dollars in net assets to also be living off an income of less than the median household income. The difference is that more of their income is disposable because they own their assets, while most of the middle class is financing their assets. In many cases, the wealthy are living off their assets - collecting royalties, annuities, dividends and other payouts. These people also enjoy a lower tax rate than wage earners (10% vs ~30%).

But how do we define the poor? That gets much easier. The poor generally have little or no capital assets (eg a home or car), and their income is not sufficient to support the acquisition of these assets while leaving enough disposable income to support their needs. A poor person either rents an apartment or home, or has to live in a shared living situation with friends or relatives. A poor person either relies on public transportation, owns a used car, or is financing a vehicle. They are unable to provide for basic needs while also saving money for future needs (retirement, emergency savings). Note that I'm talking "ability" here. We have some of the richest "poor" people on earth in America, buying name brand clothes and expensive jewelry while driving high end luxury vehicles. Also, I'm not defining the poor in terms of income. A poor person in New York earns a prevailing wage of around $12.35/hour, while someone in a rural southern area will be pegged to the minimum wage of $7.25. The New Yorker will be $6,000 above one-half the median income, and thereby considered middle class. The rural worker will be $6,000 below that same mark, and therefore considered poor. However, the rural worker will face lower costs of living, such as rents and food prices, and would therefore enjoy the same standard of living as the urbanite New Yorker. (This, incidentally, is a big driver of migration from the North East. Yes, wages are lower in the South, but cost of living is even lower, so overall living standards tend to be better.)

Taken this definition, let's look at what constitutes rich. You should be considered rich if you have non-wage income (eg income from assets, investments, etc) sufficient to provide for your basic needs and support a savings rate of 10% of income. We've traditionally associated the rich with people who don't have to "work for a living", and that's the definition I'd like to stay with.

That leaves us with the "middle class". I define the middle class as being between the rich and poor, which seems somewhat obvious. But given the definitions of rich and poor above, the middle class would be those people with a mixture of asset-based income and wage based income which is sufficient to support their basic needs, a 10% savings rate, but also to allow for 10% of their income to be "disposable". By disposable, I mean they money can be spent on either non-essential items (landscaping for their yard), or to satisfy their basic needs with better commodities (designer label clothes, luxury cars, organic food, boutique coffees, etc).

At this point, if you've followed me, it's because you've granted me a lot of latitude. I've come from talking about how technology, while making some workers obsolete, ultimately benefits everyone (including the poor). And my argument should come full circle, because here is my point: if the people at the bottom rung of the income ladder cannot increase their income, then cheaper goods will bring them closer to realizing the middle class dream. If technology reduces the price of making a t-shirt from $10.33 to $3.47, then a poor person can either buy 3 times as many t-shirts for the same price, or they can buy a far nicer t-shirt at the same price. Consider that many of the things today considered necessities - internet, cable, phone service, electricity - were considered luxuries by our grandparents. Technology and change has always benefitted the poorest people even more than the richest because it has better allowed them to afford goods and grow closer to the middle class lifestyle.

Monday, May 25, 2015

2, 3, 4 What Are We fighting For?

This past Monday, American's celebrated 'Murica by drinking too much light beer, grilling dead animal flesh and frolicking about in bodies of water from sea to shining sea. There was flag waving, thanking of veterans, and a complete missing of the point. Except for these guys:

Wednesday, May 20, 2015

Herrmann, Certified Badass

From time to time, I like to direct the attention of individuals towards those men who, in my opinion, represent true manhood. I'm not talking about testosterone filled asshats who show off their boy toys or who swagger excessively to compensate for the penile-challenged lives. I mean true, certified badasses - men of heart and rugged individuals.

So today on the TruckYeah! blog, there was a story about some journos who were testing out the new Dodge Ram when they picked up a hitchhiker. Reading the story, I started to think “what kind of societal drop out is this loon, and what heinous sex crime is he running from?” Then I clicked over to his blog and found well written, engaging and entertaining articles. His description of the Cherry Creek made me long for my days of camping in the Tonto National Forest. He eulogy to his cat, who passed just this last April, made me forget my disdain for felines and damn near shed a tear. (I mean, if my coworkers weren’t watching, I would have.)

Herrmann, your certified Hemmingway-esque badassery is confirmed.