California Primaries

What have we learned from the California primaries?

Well the GOP candidate for governor will be setting up an internet exchange so states can buy and sell new, almost new, used and surplus citizens. This will do two significant things. First, it will allow California to trade in citizens they do not want, and other states to purchase citizens they do want. California can even accept a fee for the transactions between other states. Who knows, it could go international. Some day countries may even be able to buy and sell citizens.


Meanwhile the GOP candidate for the senate plans to transition a number of Californians into another state, while looking for opportunities to merge with another state. While some may suggest a state that has a significantly different base (Wyoming, Texas, Alaska), others look to a merger of similarities (Florida, or even New York.) This will allow them to continually improve the value of the products and services offered to customers. It will also excellent opportunities for companies, err states, to grow and prosper.

Is Lunz dishonest, or merely an idiot

Frank Lunz - Why the Dodd Financial Services Bill is bad for ..Democrats

Frank Lunz, in a recent opinion piece/swiftboat, has again shown that facts, logic, and intellectual honesty are not barriers to forming an opinion – at least for the spin doctors in the GOP. Even a quick read of Lunz’ piece shows quarter truths and obfuscation working overtime to make the GOP’s opposition to the Financial Regulation bill look like a win for main street.

Lunz ”But here's where it gets really interesting. The Democrats supporting the current legislation have assured an anxious electorate that whatever funds are used to create whatever regulatory scheme created will come from the banks, not the taxpayers. Let me emphasize that so that even casual readers will catch it: the Democrats promise that you won't pay for their legislation, banks will.

Really?
Since when have corporations ever paid taxes, fees or penalties? Employees end up paying in the form of lower salaries and benefits. Customers end up paying in the form of higher costs.”
So the argument is:
(1) Corporations never pay taxes fees penalties. Well a quick Google shows that SEC fines were among their lowest in 2007 -when the economy started to dissolve – but it also shows $50 million dollar fines to McAfee in 2006, $50 million dollar fine to GE in 2009, $30k fines in April to Stansbury, among many others from a variety of agencies. Since it is a required charge to banks above a certain size to pay into the insurance pool, how are they going to get out of paying this? Of course, there is not an explanation.
(2) Employees end up paying in the form of lower salaries and benefits. Well, I am not sure how much of Main Street is worried about the Salaries of Goldman Sachs, or the executives of JP Morgan/Chase, BOA or Wachovia.
(3) Customers end up paying in the form of higher costs. First, does anyone really have a Goldman checking account or a Bear Stearns ATM card? Of course they don’t, because the product doesn’t exist. Second, this ignores Economics 101. Price is set primarily by what the market will bear, and added costs will reduce profits, but it will not necessarily create new checking taxes. Third, (well or Part two of number two), this big bank fee will actually make smaller banks more competitive. The neighborhood bank will have a lower cost of doing business than the biggest banks, so it could be easier for them to provide cheaper services. Wouldn’t that be good for Main Street!

Lunz “More than 130 companies have publicly hired lobbyists seeking their own loophole. Mars Candy wants to continue to use derivatives to hedge against price hikes in sugar and chocolate, so they've hired a lobbyist. Harley Davidson wants to protect dealer financing of their bikes, so they've hired a lobbyist. And eBay wants to not harm its subsidiary, PayPal, so they've hired ... well ... a team of lobbyists.”

Lenz, not unsurprisingly, fails to mention that farmers have used derivatives as a hedge against price shocks and variable harvests. Does he want to ban them and hurt farmers? Furthermore, he also ignores the fact that the bill does not provide loopholes while banning derivatives.

Lenz closes by blaming Blanche Lincoln’s troubles on the health care bill. This would be perfectly accurate, except she was struggling well before the bill’s passage.

Ah, how easy it would be to make an argument in a world where honesty does not reside.

5 recent reads, and a sixth that makes you go Hmmmm

Robert Kuttner - "Fraud At Last"

…Paul Volcker was right when he quipped that the last useful innovation produced by the banking system was the ATM machine. For something like three decades, the financial part of our economy has become a world unto itself, consuming over 40 percent of all corporate profits by 2006, the last year before the crash…

We need a drastic, radical simplification of the financial system. That means breaking up large institutions that are too big to fail, and breaking the rice bowl of ones that add nothing to broad economic welfare and efficiency other than an opportunity for the own enrichment at the general expense. To get there politically, we first need to expose the full extent of the fraud, and we need a Democratic Party that reverts to its New Deal role as the party of regular people rather than its Clintonian role as a second party of Wall Street….

Fact Checker for Lost

…But fight scenes are nothing compared with flight scenes. The plane, Nations says, “is the bane of my existence.” The task of keeping, say, row numbers straight in a hectic production on a cramped set makes his stomach turn, especially as they’ve filmed essentially the same scene over multiple seasons. …

Pictures of Various Countries' Antarctica Bases

Bradford DeLong Reports that GOP opposes Solomon as Judge.

In a press conference last midnight, Senators McConnell and Hatch reacted to a report by Jeremiah that YHWH had secretly met with Solomon ben Davi in a dream at Gibeon and planned to nominate him. "We question whether YHWH understands what makes a good judge," they said in a joint statement…

A Flash game (not the program - the super hero)

To put it plainly, I just don't see how one could work. My reasons:

The Flash is all about speed. His greatest power is supposed to be his ability to move near light-speed. How exactly are you supposed to portray that in a game? Moving at those speeds, it would be impossible to control the Flash with any kind of precision. You can't use trickery either, like slowing down the rest of the world while Flash moves at normal speed. It would work, but it just wouldn't be Flash. You wouldn't have that sense of speed….

And Worth a re-read.

McClatchy on How Moody's and others sold their ratings

…The Securities and Exchange Commission issued a blistering report on how profit motives had undermined the integrity of ratings at Moody's and its main competitors, Fitch Ratings and Standard & Poor's, in July 2008, but the full extent of Moody's internal strife never has been publicly revealed.

Moody's, which rates McClatchy's debt and assigns it quite low value, disputes every allegation against it. "Moody's has rigorous standards in place to protect the integrity of ratings from commercial considerations," said Michael Adler, Moody's vice president for corporate communications, in an e-mail response to McClatchy.

Insiders, however, say that wasn't true before the financial meltdown.

(Does anyone else think find it interesting that Moody’s has started a lot of whispering about lowering the ratings of U.S. Government Bonds while the Senate discusses regulating Moody’s? I suppose it is just a coincidence)

This is a Big Forking Obvious Statement

As virtually all of you know, Veep Joe Biden recently commented to President Obama, DURING the LIVE, RECORDED SIGNING CEREMONY, that the signing of the health care bill was a...





"Big Fudging Deal."



I have been scouring the internet for other profane statements of the obvious, and here is what I have found...





Neil Armstrong during his famous walk, actual said "This is one big Fish Taco step for mankind."





Al Michaels, at the 1980 Winter Olympics, actually said "Do you believe in Miracles - man This is a Big Flapping Deal."

Alexander Graham Bell's first words on the telephone... "Mr. Watson, Come here - I want to see you... Now Mr. Watson, this is a big frumpy deal."

And in a strange anachronism, scouring the Richard Nixon tapes - you find Haldeman telling Nixon. "This Watergate thing, it is important. it is a big Joe Biden Deal."

A Few idle thoughts on the Teaparty movement, Facebook ads, and the general absurdity

Popped onto Facebook only to see a dozen more ads for various GOP and/or Tea Party Candidates. One of them states "Help fight the Pelosi/Reid/Obama agenda!" Fight it? I want their agenda! I voted for it and will again! I think we need more regulation of the financial industry, health care reform and environmental reform! I keep flagging them as offensive, but cannot just see more of the same.

Speaking of which, does anyone else find the concept of the Tea Party just a touch ironic. Lets Compare:

* The Boston Tea Party was about taxation without representation (high Tea taxes to pay for non-colony expenditures and the colonies had no Parlimentary representation - no voice on tax policy.

* Present Tea Party (and GOP behavior) is all about obstructing any and all activities of the majority. In some cases representatives of 14% of the population (or less) is controlling the debate - if anything the rightful descendents of those revolutionaries is the rank and file Democrat who is watching their goals for improving our country being stymied by a vocal few FOX aristocrats and their lackeys.

* It is also interesting that the Tea Party seems so interested in lower taxes even though we have some of the lowest taxes in the developed world. Also interesting that so many seem to be of Medicare age, but are protesting government run health care.

My response to Dan Boren's letter

(This is my response to his response, unfortunately I do not have my first letter to Representative Boren.)

Dear Representative Boren,

Thank you for the response. I would like to take a minute to address some of your comments and conclusions. You are completely correct that we have ramped up our energy usage dramatically in the past 30 years. You are also correct that a "Cap and Trade" program would drive up the costs of traditional fuels which would make " green energy sources, whose cost have always been higher, more competitive in the marketplace." However, you omit or ignore two factors. First, the reason that traditional fuels are cheaper is because there are costs of these fuels do not contain the pollution and environmental damage that results from acquisition and use of these traditional fuels. Cap and Trade would make the market more honest and respect the costs that are not associated with basic production. Second, the green energy sources are more expensive because they are so small and limited. If they could compete on an even playing field with other fuels then there would be innovation and expansion that would drive green energy pricing down while providing a more honest price for traditional fuels.

The Cap and Trade bill is not merely an environmental bill will improve our national security position by reducing our dependence on foreign energy sources as well as insulating us against demand generated, production generated, or conflict generated price spikes. Japan weathered the energy price increases of 2007-2008 more successfully than our country because they have a much more effective efficiency program combined with their focus on renewables.

The same comments about job loss were made when we had the effective Cap and Trade program for SO2 which was an incredibly successful program to reduce SO2 emissions and acid rain. A few years ago Texas Instruments had the opportunity to build a new wafer plant in China or Singapore. Instead they built it in Richardson Texas, using green tools to reduce the energy usage during building and the energy footprint of the building. More thought in the building, planning and design work resulted in a construction cost of 30% less per square foot than the previous building with expectations of 20% less in energy usage and 35% less in water usage. So even if cap and trade increased costs 6% there would still be a net savings of 16%. On a side note, I would personally prefer the computer chip jobs to the concrete plant jobs for our cities and towns.

Companies can only charge what the market will allow; they cannot raise prices just because their costs increase or they will price their product out of the market. While there might possibly be a few companies that are at risk of movement (though I haven’t seen any research to support this claim) most companies are not as portable as you assume. For example, utilities cannot move to China to produce electricity for our local communities.

Furthermore, we are losing jobs right now because American companies who are in the green technology business are moving overseas to be closer to the businesses and governments which buy their products. Energy efficiency and renewables are the future of industrial innovation. How are we going to provide these jobs, produce these jobs or develop the technology if we have no experience in green technology?

Yes it will increase the cost of energy in Oklahoma. That is primarily our fault for allowing our environmental standards to be so lax for so long. We allow pollution, coal plants cover the state, and artificially low energy prices - prices that defer the costs to the environment and the health of its citizens. I see the coal trains often and coal generated pollution from the OG&E plant every day on my way to and from work. It seems that every month more friends and acquaintances are developing asthma. Isn't improvement in this area this really worth the few dollars more per month - $175 per year based on the CBO estimates?

You mentioned a windfall in California. California has been concerned about pollution since the 1970's and have very strict environmental policies, if that long term vision results in a rewards, well, I would call that a return on investment the resulted in their economy growing much faster than that of Oklahoma.

On a personal note, I also know that we recently reinsulated our home and replaced our furnace and air conditioner. Since making these changes in January we have seen between 30 and 40% reduction in KWH. Imagine what would happen if people had even more encouragement to address their efficiency. If we combined this with smarter grids and tools so that energy companies could profit as much by encouraging efficiency as selling more power we could be leaders not followers.

You also mentioned concern about the limited overall impact of the Cap and Trade provisions. You are correct that China and India will not be party to this law. However, I am somewhat disturbed that you would compare us so easily to these countries and define what we should or should not do not by whether it is the right thing to do, but whether or not other countries are doing it as well. That is akin to saying you cannot make certain every child gets a healthy breakfast so why even try to provide any children as possible with a healthy breakfast. Or on a governmental level, since Arkansas isn't working to improve water quality why should we try to improve water quality - the water won't be perfectly clean.

This point also ignores the fact that development of cleaner and more efficient technologies will allow us to sell these products to China and India on a massive scale. China is already buying the new more efficient GE diesel locomotives (as is Brazil and Mexico) because they are so much cheaper to operate over the long term - not because they are the cheapest thing to purchase. China has a horrible pollution problem already, imagine if we could sell them truly efficient carbon scrubbers, software and hardware that would improve electrical efficiency, better solar power tools, and the list goes on and on. We need Cap and Trade to stimulate these industries and encourage more investment. This is about pricing fossil fuels accurately based on the environmental impact, and not encouraging wasteful energy policies based on artificially low traditional fuel pricing which ignores the long term impact of productions and use.

Respectfully Yours,

Darren Magady

Letter from Dan Boren

Recently I wrote Dan Boren (the Representitive to Congress for this district) a letter expressing my disappointment that he did not have the foresight and courage to support the Cap and Trade Bill. Yes it is a flawed bill, as all are, but it will be a big step in the right direction.

This is his response to my letter.

Dear Mr. Magady:

Thank you for contacting me about H.R. 2454, the American Clean Energy & Security Act, commonly referred to as the "Cap and Trade" bill, which includes an attempt to address the issue of climate change by creating a market to control carbon emissions. I always appreciate the opportunity to hear from concerned Oklahomans, and welcome the opportunity to share with you my views on the issue.

H.R. 2454 is designed to limit greenhouse gases produced within the United States by capping the level of carbon and other gases emitted by companies, and by initially issuing and eventually selling pollution "allowances" for those levels that extend beyond the cap. Over a twenty year period, the cap would continually grow more and more restrictive, driving up the costs of using traditional carbon-emitting fuels and making green energy sources, whose cost have always been higher, more competitive in the marketplace.

While I strongly support initiatives to develop alternative energy and incorporate them into our national energy portfolio, I have consistently argued that we must also balance our economic and national security priorities with our environmental priorities. Over the past three decades, U.S. Energy demands have increased dramatically, making us increasingly dependent on foreign energy sources. The most relevant energy challenge facing our nation is escalating demand coupled with finite domestic sources. It is critical that a national energy policy reflect a balanced mix of domestic production of reliable energy resources, including natural gas, development of domestic renewable energy sources, improvements in our infrastructure and a commitment to conservation.

In contrast, the climate bill in question poses a grave threat to the US economy by driving American jobs into other countries. As caps on emissions grow more restrictive, so will the cost of domestic production. The legislation assumes companies will seek other forms of energy, but historically companies faced with driving costs imposed by the government naturally seek cheaper places to operate business, leading to the outsourcing of jobs and industry to countries with less exacting standards. Additionally, the bill would directly send billions of tax dollars overseas in the form of "international emission offsets," in order to subsidize similar environmental measures that foreign governments themselves refuse to shoulder.

On its most basic level a cap and trade system will increase the cost of doing business and increase the price of energy for Oklahomans. Businesses and local utilities will be forced to pass the burden of fees onto consumers in order to stay afloat, at a time when the average American is already under intense economic strain. The disproportionate cost burden created by the unfair distribution of emission allowances will be most severe for states like Oklahoma, where commissions and utilities have worked hard to keep electricity rates low. Oklahomans will likely see double-digit percentage increases on their utility bills, while states like California will receive windfall benefits.

These economically burdensome measures have no guarantee of any significant benefit to the global environment. Europe implemented a similar cap and trade program years ago, with questionable effects. In Belgium, for instance, environmental standards were raised too high for cement companies to remain financial viable. They relocated to Morocco, where they could operate with virtually no environmental regulations. Pollution did not lessen; it merely relocated to a new home, taking jobs along with it. Today the economies of China and India are expanding rapidly, and are not about to limit their commercial development by adopting punitive environmental measures.

Finally, even if HR 2454 goes according to plan, its impact on the global environment will be negligible at best. The United States accounts for 25% of global greenhouse gas emissions. The cap and trade bill aims to reduce our emissions by 15% over the next twenty years. Even if we accomplish this goal, it will result in a mere 4% reduction in global gas emissions.

I believe that there are more practical and cost effective ways to both protect the environment and to preserve American business interests. For this reason I have sponsored HR 1835, The New Alternative Transportation to Give Americans Solutions Act (NAT GAS Act). This bill offers tax incentives to encourage vehicles powered by natural gas, which run cleaner than gasoline and diesel powered engines and rely on a source of fuel abundantly found throughout the United States. Exchanging one traditionally fueled garbage truck with one fueled by natural gas is the environmental equivalent of taking 300 cars off the road.

America cannot mandate environmental reform to developing nations like China or India. If we are to make a real impact on global climate, it must be through innovation and not self-constraint. This can best be achieved by offering tax incentives to businesses, in order to develop green technology through the private sector rather than in spite of it.

The "Cap and Trade" bill is risky and ineffective, and I voted against it for those reasons. Please rest assured that I will continue working to provide viable alternatives to the economic and environmental challenges facing our country. I hope I can count on your support.

Respectfully Yours,

Dan Boren
Member of Congress