Monthly Archives: October 2008

Our very own James A. Bacon wrote a blog about a week ago predicting tough times for Hampton Roads.

Although Jim claims to be independent, that’s BS. We really know where his sympathies lie. Basically, Jim believes that an Obama win will be bad for Tidewater. He wrote:

“I’m not making a partisan statement or casting a value judgment here. My point is not to dredge up the rights and wrongs of U.S. foreign and military policy. I’m simply observing that the Elephant Clan, for better or worse, funnels more money into the military than does the Donkey Clan. Commuities dependent upon military spending, such as Hampton Roads, fare better during Elephant Clan administrations.”

Well, that’s a very simple, pat and intuitive piece of analysis.

Maybe too simple, pat and intuitive.

The Virginian-Pilot reports today that Obama is outstripping McCain in defense contributions. According to the Center for Responsive Politics, Obama has received $870,165 to McCain’s $647.313.

What? After all, McCain’s an Annapolis grad, career Navy, former aviator and Vietnam POW. Obama has zero military experience.

According to military analyst Loren Thompson of the Lexington Institute, Obama and McCain really aren’t that far apart on defense issues after you extract Iraq. Both candidates are targetting excess defense spending for weapons systems we don’t need. If our threats are going to be Islamic insurgents, do we need ultra high performance F-22 Raptors, unless, of course, Putin starts a serious conflict or gives Sukhoi 35s to Hugo Chavez?

So, it looks like Hampton Roads will be in some jeopardy, regardless of who wins Tuesday. Thompson, hwoever, believes that jobs at Northrup Grumman are safe.

So, Jim Bacon is half right. He’s correct that defense will take a hit; but he’s wrong with assuming that it will be a worse under Obama. Military contractors obviously don’t think so. Once again, we’re seeing this campaign turn old chesnuts, particularly those of the Republican variety, on their heads.

And, please, Jim, can we drop this “Donkey Clan” and “Elephant Clan” crap? We need to cleanse the world of all-too-cute Risse-speak.

Peter Galuszka

Some of you have noticed that the format of the Bacon’s Rebellion blog has changed. Here’s the story: Blogger “upgraded” its software and induced me to incorporate the new features. In so doing, the blog roll, “about us” text and other features that had been part of the old blog disappeared. My HTML skills are minimal, so it will take a process of trial and error to figure out how to restore the missing elements. I will endeavor to do so when I have the time.

Here’s a puzzle. Why is it that Virginia has so many cosmopolitan advantages useful in the global economy yet there is so much reactionary xenophobia particularly in areas where the thinking should be more advanced?

The Old Dominion is next door to the nation’s capital, has a plethora of U.S. government and non-governmental agencies, top-ranked ports, military, diplomatic missions and vibrant economic sectors despite the financial meltdown.

Yet, it also has some of the worst examples of racist xenophobia. Some examples: Prince Williams County’s frisk-everyone, anti-Hispanic laws; plans to build an immigrant GULAG in Farmville and (thankfully) now dead plans my my home county of Chesterfield to “identify” illeagl immigrants who are only Hispanic and rank in guess-work numbers far beyond reality.

So, we owe it to Richmond magazine for its perceptive cover package this month on how the foreign-born influence Greater Richmond. This worthy project has plenty of personal tales of living abroad and ending up here. But the one item that attracts my interest is a detailed graphic by artist Chris Obrion with whom I used to work at Virginia Business some years ago.

Chris’s work points out the many and varied local companies owned by foreigners. Germany has 32 firms in the area that employ 4,241. Next are the French with five firms and 1,617 workers. The U.K. is next with 27 firms and 1,327 workers. The Japanese have 18 firms with 1,072 workers. Mexico has two firms employing 131 and Greece has one firm employing 55.

To be sure, some of the foreign firms are having big problems, such as German-owned chip maker Qimonda which has 2,275 local workers and will lay off about 1,200. But the rest seem healthy. French -owned Alstom Power services and repairs turbines in Chesterfield and Maruchan Virginia Inc., owned by Japanese businessmen, makes noodle soup.

Richmond magazine lays all of this out for you in a way that impresses based on its sheer mass. It makes you wonder why so many politicians, especially Republicans in wealthy white suburban areas, are so keen on creating suspicion about foreigners and placing every barrier they can think of in their path. Doing so somehow makes them seem more “American” and therefore vote-worthy. But all it does is show how little they know about the world today and how much they are hurting the United States and Virginia in the name of waving the flag.

Peter Galuszka

Last week Thomas L. Friedman’s most recent book was at the top of WaPo’s nonfiction best sellers list. This week it is number four.

Footnote: EMR got his hands on a nonsanctioned lite book –a LARGE PRINT version – so he went to the Greater Warrenton Borders for one that is easier to read. In these times of financial crisis when citizens really need to understand how the world works, two copies of Friedman’s book were on a shelf in the way-way-back. What was in front piled in great stacks? Fiction, political hack screeds and in-depth reporting on the same insights found in tabloids and Parade: “Daniel Craig is more than a tough guy.”

Friedman’s title, Hot, Flat and Crowed, is provocative, but there are several problems of Vocabulary.

HOT

“HOT” refers to Global Climate Change. It plays to his subtitle” “Why We Need a Green Revolution – And How it Can Renew America.”

There is some debate about whether the earth is really getting hotter – most of the negative assessments come from proponents of Business-As-Usual and from “principled-conservatives” which makes this perspective suspect from the start.

There is even more heated discussion about whether human action is a driver / accelerator of Global Climate Change but Friedman seems to have no doubts.

As EMR has said over and over both the existence of a warming trend and the causes are fine to debate but the larger reality is that does not make any difference.

What ever the trend and whatever the cause, the “alarmists” who have a problem with Global Warming and decry the human impact on Climate Change are calling for actions that for the most part are needed for other very sound economic, social and physical reasons. Jim Bacon and EMR agree on this since he is more of a skeptic on the issue of causation.

Two other thoughts on HOT:

EMR has been carefully watching the well documented melting of glaciers for the past 60-plus years in his home Community – a disaggregated and very Beta Community in the Northern Rocky Mountain Urban Support Region.

Second, one of the biggest non-economic and non-mysterious health problems is that people go to the hospital for a well known cause and come out with an gratuitous infection. Peyton and Kellen had infections in the last few weeks.

EMR spent some time in the Greater Warrenton-Fauquier Community Hospital last week. (“If you want to do great things in your world, spend some time in ours,” US Navy)

It became obvious – while waiting for the medical staff to assembly to carry out a routine exploratory procedure, and while covered with a sheet and pre-warmed double blanket – the special-ops area of the hospital was COLD. The doctors and nurses were wearing two and three (visible) layers. The Hispanic lady who was scrubbing equipment looked like what was once called an “Eskimo” but is now call an “Inuit,” (aka, Aemai – An Earlier North American Immigrant.)

Why so cold in the Hospital? Do infections spread more easily in warmer temperatures? Having spent a month or more in the subtropics for over 30 years – and some time in hospitals on
Tortola and St. Vincent – EMR suspects the answer is “yes.”

Based on direct experience, EMR sees no reason to question the predominance of scientific evidence on both warming and cause but as noted above, that is not the real issue.

So HOT is problematic, However, HOTTER or not, what is important is that what is recommended to stop accelerating Global Warming makes sense to achieve a sustainable trajectory for society. Do we really need to fuss over “HOT” to make better decisions about locations and the allocation of resources?

FLAT

Friedman has ended the lives of thousands of acres of forest in order to tell readers of serial editions an earlier book about FLAT. By FLAT he means “Globality: Competing with Everyone From Everywhere for Everything.” – to use Sirkin, et. al.’s title and explanation – is making the world seem “flat.” As Supercapitalism makes very clear Globality and FLAT is not a good thing from many perspectives.

The fact is, the most important thing is NOT the price of tea in China.

The most important thing for any citizen is the safety, happiness and well being of the other citizens in ones Cluster, the Clusters that make up their Neighborhood, the Neighborhoods that make up their Village…

The complexity of Globality is an excuse for avoiding what is really important. For this reason FLAT is confusing and the analogy is way over-used.

CROWDED

It is with “Crowded” that Friedman goes off the rail.

He fails to understand that “Crowded” is an variable that is dependent upon human settlement patterns. What seems to be “Crowded” is due to a dysfunctional distribution of human activity and the failure to allocate resources equitably.

Six and a half billion people is not beyond the carrying capacity of the Earth.

Six and a half billion citizens is beyond the carrying capacity of Earth if they all were to consume as much per capita as those in the US of A believe to be their birthright.

The primary driver of unsustainable per capita consumption is dysfunctional settlement pattern.

Of course with fewer citizens on Earth, everyone could enjoy more per capita consumption but that is a different issue.

Freedman sees the problem of CROWDED as being due to the expansion of the “middle class.” Never mind that the Middle Class disappeared over the past six decades.

What he means is that there has been an expansion of expectations and consumption of some at the upper levels of the Ziggurat in all the richest nation-states.

It is now quite clear that this level of consumption cannot be sustained even by a super fortunate minority. The cheap resources – natural capital – is becoming more dear and fewer and fewer can afford it.

The critical problem is that a lot of those who are not yet Mass OverConsuming have been told by pandering politicians that they deserve to achieve levels of consumption that they see in ads and in more-real-than-life streaming and screaming images spread around the Globe.

The Business-As-Usual advocates confuse the comfort and consumption of “me and my friends” at the top of the Ziggurat with the welfare and sustainability of an “advanced” technological society.

A green revolution will not solve this problem. It will take a gray-matter revolution.

To make matters worse, driven by Business-As-Usual and MainStream Media, the only interest in “green” that has been discovered outside small, intentional communities has been Green Greed – Buy our product and feel good about consumption.

In a rational world, ads for a “full-size, luxury SUV Hybrid” would be considered pornography.

Energy, technology and meat along with Large, Private Vehicles and Scattered McMansions will never again be cheap.

That is especially true if the there is a delusion that it is possible to fuel, inform, over-feed, provide Mobility, Access and Shelter for six and a half billion citizens with democratic governance and market economies.

EMR

Congratulations to “darrell…Chesapeake” on a 15 percent profit in 30 minutes. And thank you for documenting EMR’s point. You make all those who say the stock market is not a gambling venue look like duffuses.

James Atticus Bowden says one could made 7 percent (compounded?) from the stock market over the period 1790 to 2008. Well sure, if you want to take the short term view :>)

The James Atticus Bowden’s time frame is just about the 1800 to 2000 period EMR uses to bracket the Agrarian to Urban Fundamental Transformation. A 7 percent return is to be expected given the continent of nonrenewable resources that have been consumed. Did someone say there is a limit to nonrenewable resources? Can you say “Punctuated Equilibrium?”

Lets take a shorter period, say since 1973 when every citizen should have know that Fundamental Transformation from Mass OverConsumption to sustainability was imperative.

The same or perhaps even greater “growth” of the stock market might be calculated but that demonstrates why data that is not aggregated intelligently is more misleading than no data. This reality concerning data is critical to achieving an understanding of human settlement patterns but it is also important in this context.

Some stocks (or baskets of stocks) did a lot better than 7 percent compounded after inflation since 1973. These are the ones that brokers like to cite.

Then there are stocks (or baskets of stocks) that did a lot worse. One never hears about them.

One could have chosen what seemed like a great basket of stocks in 1972 and now find that none of them even exist now.

An “average” is fine but the investor must trade to keep the basket fresh and there in lies the gamble.

Who does one rely on for advice? A broker who makes profit every time you trade? Just hope she does not recommend Centennial Illinois, Lincoln S&L, Enron, WorldCom, Fannie or Freddie, AIG, …

You might invest in risk-minimizing mutual funds or other vehicles. Who do you rely on to rate these financial “products”? How about Moody’s, Standard and Poor’s or Fitch? See today’s coverage of yesterdays hearing on The Hill.

A favorite investing joke is about a car load of rotten sardines. The punch line is “What difference does it make if those sardines are rotten? They are not for eating, they are for buying and selling.”

Then there is Blogger Bob who champions that bellwether of functional settlement patterns, the pregnant-mother-of-two:

“A technologically driven society is more productive, and therefore costs are reduced.”

The crown prince of non sequiturs speaks.

The issue in not “productivity” it is consumption vs. capacity of a closed system. It is ecological footprint, it is the trajectory of consumption. By current measures of “productivity” driving a bus load of pregnant-mothers-of-two into a moving train adds to the GDP.

(More on pregnant-mothers-of-two soon.)

There needs to be an alternative to the negative trajectory of Business-As-Usual. How about Regional investing?

Garmeen Bank / mini-investing has won a Nobel prize. Why not Household investing, friend investing, Cluster investing, Neighborhood investing, Community investing, Regional investing – How about a diversified portfolio being an array of Regional investments in things that will make your life better.

Global speculation drives Supercapitalism.

Citizens should have the ability to investment in goods and services that they understand and the location of which creates functional and sustainable settlement patterns. A lot smarter than sardines for buying and selling.

Here is a specific: A Regional network of Community Enterprises that recycle / rebuild small batteries. As the Global supply chain atrophies one of the first things to come into short supply might be small batteries. The ones without which, hearing aids, hand held instruments, cameras, cell phones, alarm systems and millions of other devices will be useless, toxic junk.

“Rechargeable” is fine but rechargeables wear out and eventually do not hold a charge. An investment is a Regional system to redesign batteries so they can be rebuild and traded for spent ones might be a winner. There are thousands of battery sizes besides AAA, AA, A, C and D but one might start with “standard” sizes first. Right now all the big money is going to improve big batteries to propel Large, Private Vehicles. How do you market these new batteries? Well to the investors and their Households.

Billions of small batteries end up in the land fill every year. Well meaning “environmental services” try to keep car batteries out of the land fills but many of them still go there. A bigger problem is the small batteries.

In a primitive lab it is possible build a big 12 volt battery. Or get a jump start and use the generator. Try that with you cell phone. Standardize and redesign of batteries so they can be renewed. Not in China, but right in your Region.

Bill “Green Dean” McDonough could think of a thousand other “investments” but that will do to illustrate the concept of Regional investment.

EMR

Running a cost-efficient government means paying attention to the details. In his latest column, Mike Thompson, president of the Thomas Jefferson Institute for Public Policy, describes one idea that has saved the state millions of dollars — and points to other reforms that can save millions more.

Thompson serves on the Regulatory Reform Commission, a bi-partisan group appointed by Attorney General Bob McDonnell, and he sits on the infrastructure task force chaired by Lt. Gov. Bill Bolling. He reports this success story:

The General Assembly transferred the responsibility for maintenance of the state’s automobile fleet of 4,669 vehicles from the Virginia Department of Transportation (VDOT) to the Department of General Services (DGS). The DGS then opened auto maintenance to private sector providers to compete with VDOT’s expertise in this area. Since this competitive sourcing process began, we have found that in only some areas does VDOT provide the best service for the best price, and in other cases the private sector provides the best service and best price. But far more importantly, the state has saved fully 25% on the cost of auto maintenance by bringing competition to the table of vehicle maintenance.

Then Thompson turns his gimlet eye toward higher education. Building costs on Virginia campuses, Thompson had heard, were 20 percent higher than comparable buildings off campus — presumably the consequence of state regulations. The task force called in a Virginia Tech official for details, only to find out that the cost padding was far worse. At Virginia Tech, the per-square-foot cost of buildings on campus is 70 percent higher than buildings in the research park adjacent to the campus.

One reason is a Virginia Tech specification that every building must be constructed of “Hokie stone,” a dolomite limestone that is a defining feature of the campus. From Wikipedia: 80 percent of the stone is quarried from a 40-acre, University-owned quarry a few miles from campus, the rest from a second quarry on a local farm. Some 25-30 Virginia Tech employees “use black powder each day to dislodge the stone into block sizes and finish the blocks by hand using hammers and chisels.” Sounds expensive.

As expensive as it is, Hokie Stone accounts for only a portion of the inflated construction costs. It would be interesting to know what other factors are responsible for the bloat. The next time Virginians are asked to approve another $100 million+ bond offering to support higher-ed building construction, we might press for answers first.

In his column, Thompson cites other examples of absurd regulations and easy savings. As long as legislators adopt the attitude that it’s easier to stick the costs on taxpayers than the review state regulations with a fine-tooth comb, Virginians will pay higher taxes than they need to, and our periodic fiscal crises will be worse than they need be.

John McCain’s faltering presidential campaign keeps grasping desperately at straws. The former beauty queen from Wasilla is one; NASCAR and country music is another.

It amazes me just how the GOP scrapes for the support of the working classes it has so badly screwed over in the past eight years. And the McCain campaign and its party are trotting out just about every cliché they can think of.

Consider Sarah Palin’s showing at Richmond International Raceway this week. According to the adoring – and so typically out-to-lunch – editorial writers at the hapless Richmond Times-Dispatch, Palin:

“… drew a huge throng of enthusiastic red-state voters. Jerry Kilgore warmed up an already perspiring crowd by leading the Pledge of Allegiance and offering a prayer for the country — and for the safety and well-being of the Republican ticket. Not a moment too soon, some wags might respond.

Country-music legend Hank Williams Jr. crooned the national anthem with gusto, if not entirely on key. This was an all-American crowd. The gaping chasm between the audience and those covering the event was illuminated by the British reporter who leaned over to ask, “Who is that?”

“It’s Hank Williams Jr.” an editorial writer responded. “His son?” the Brit queried. “Well, he can’t sing.” The gentleman missed the point. Moments later, Williams launched into a revised version of his hit song “Family Tradition.” The first line? “The left-wing, liberal media are a real close-knit family.” The audience bellowed its approval.”

So let’s try to follow the logic: Palin equals redneck equals working class approval equals Hank Williams Jr. equals putting down the “left-wing liberal media” equals GOP victory in November.

My, how smug. But let’s take the cliché apart. For one thing, every working class, pickup truck driving, deer-hunting good ole boy an girl in ole Virginny does not mindlessly go for every iconic symbol the khaki pants and Navy blazer GOP crowd can come up with. Certainly not all country musicians fall into the Hank Williams Jr. mindlessness set.

Just after I read ther RTD’s editorial this morning, something I try to avoid normally, I was driving my car and heard bluegrass patriarch Ralph Stanley on the radio for Obama, noting that eight years of misery is enough. Stanley, for those of you who don’t know, is from the Dickenson County coalfields and has been a legend in Virginia bluegrass since the 1940s. Unlike Hank Williams Jr., who when sober merely grooves on his daddy’s aging karma, Stanley has some brains and serves on the local school board from time to time when he’s not on the road.

I can think of a few other country music stars who aren’t exactly in the Bush-McCain-Palin just-us-folks camp. They include the Dixie Chicks, obviously, and Steve Earle whose powerful lyrics can really light a political fire.

If you want a truly scathing attack on the financial mess and the Bushies who created it, take a listen to bluegrass mandolin star Del McCoury’s new CD “Moneyland.” It is dedicated to the working class who have been badly hurt by eight years of GOP mismanagement and, interestingly, contains a clip or two of an FDR fireside chat.

My favorite song on the CD is “Forty Acres and a Fool,” which decries the exact, same suburban sprawl policies that have so defined development-happy, GOP-led boards of supervisors in such places as Loudoun and Prince William Counties. In the song, a newly-rich market trader buys a house in the country. Some lyrics:

“He’s got a pretty trophy wife.
Set her up in a McMansion
But now he’s trying to wreck my life
He’s driving out in his new Hummer
I tell my kids don’t walk to school
Took out my mailbox, squashed a possum
Forty Acres and a fool.”

Now that it’s a song even EMR can sink his teeth into. You betcha!

Peter Galuszka