Posts Tagged ‘Politics’

Making Work for ATT

December 29, 2010

At work, we had a phone line through ATT that we didn’t use anymore. We also had a DSL line that we use for our phone system tied to that account. We wanted to cancel the phone line, but keep the DSL line. Sounds pretty simple, right?

Let’s just say it ended up being a lesson in the power of the International Communications Workers Union. When we canceled the phone line, they told us we would have a new account number. Nobody thought anything of it.

Then, the next morning, our phones were dead. I checked the DSL modem, to see if it was that or the phone system itself. The lights on the modem were all dead. Definitely a DSL problem. After calling ATT, we figured out that our new account number meant we had a completely new account. They couldn’t just cancel the phone line and keep the DSL line active. Perhaps this was a quirk in ATT’s system.

They told us that they would be able to turn it on for us in a few hours.   Then we got a call back from another rep saying that since we were in California, they couldn’t just turn it back on.  They had to send someone out to install the line.

We told them that we already had the modem, everything was hooked up, and we just needed the line switched. The answer was no. We had to have someone come out. So we scheduled it between 8 am and noon in a few days.

This was during a time when our office was closed for the Holidays, but I had some work to do so I came in with our IT guy. That morning at 9:30, we got an automated call from ATT saying that our line was now ready to use and we needed to register our account.   So now I came in to wait for an install that wasn’t even going to happen? They also were kind enough to tell us if we were having trouble, they could send someone out for $150.

I was mad, so I got on chat support with ATT. We got the modem activated and were up and running. I asked them why they told us someone had to come out. They said that on their records, no one was ever scheduled. I was dumbfounded.

After all this, an ATT truck pulls up in front of our office. The guy sits there for a minute, then comes in and asks “So you’re all up and running?”

We said that we set it up ourselves. We suspected that there had to be some sort of subcontractor or union agreement behind his visit, so we asked him if he was part of a union. That’s when he told us he was part of the ICW. We asked what he was going to do, and he said “say hi and leave.”

This was one of my first direct experiences with a union “make work” program. There was no need for him to come to our office at all, but the State of California requires him to do so. The union lobbied for these regulations not to ensure that our connection was up and running, but to make sure this person had a job.

Makes you realize why we’re so uncompetitive here in CA and in the US in general…

Hayek and Bailouts

October 5, 2010

I’m in the middle of reading The Road to Serfdom, by FA Hayek.  I’m on a part right now that talks about the role of government and the free market.

People now think that free market supporters want no regulation and financial anarchy.  This is especially true with the criticism of the Tea Party.

However, Hayek claims that laws are necessary and that there are two main points:

1.  The rules have to be predictable and known in advance.

2.  The rules have to be set with no regard of who they will benefit.  A law created to benefit a particular group will create imbalances.

Unfortunately, we actually have not violated rule #1 in our economic system today.  The rules are very predictable, that our government will bail out big corporations at the expense of the individual family.  This is predictable in all the wrong ways.

We have violated rule #2 and you would be hard pressed to find any legislation that does not seek to help one particular group.  The healthcare laws are supposed to help the uninsured.  The financial overhaul is supposed to benefit the consumer.  While the laws are well meaning, we know that they will not work because business will exploit the laws that they lobbied for in their favor.

As I read more of The Road to Serfdom, I’ll keep posting my thoughts.  It is not a very easy read (Hayek’s sentences last forever!) but the ideas that he was expressing in the 1940’s are as true today as they have ever been.

TARP Success?

October 5, 2010

Today, the Treasury Department declared that the government will only lose $29 billion from the TARP program.  This is being hailed as a huge success and that we saved the financial system and the economy, preventing a second Great Depression and barely losing any money.

I have some big problems with these statements.  First of all, most of the big banks that were infused with cash paid back that money within a year of the program starting.  How can a bank go from about to collapse to financially stable so quickly?

Think about Goldman, it received $10 billion from the government.  If they just took that money and invested it for a year in 3% government bonds, that’s $300 million!  Citi and Bank of America got $20 billion each.  That could turn to $600 million of pure profit.

Did the big financial institutions create a sense of panic, in order to get the government to step in and “save” them by taking over all their bad debts?  Did they know that this panic would lead the government create a web of regulations that stifles future competition?  Anytime banks and government come together, I have a feeling the banks are going to win.

Also, where did this money come from anyway?  We created $700 billion out of thin air, gave it to banks to earn interest on, took on their bad loans, and then they gave it back to the Treasury.   Will the government now put that money to rest?  Or will it eventually make it back into the economy.

And finally, $33 billion is still a lot of money.  We have just become desensitized to the number because we saw the $750 billion stimulus package and the $700 billion bailout.  $33 billion just seems like a drop in the bucket.

While the government claims the success of TARP, I find it hard to believe that it saved our economy and that the true cost was really that low.  We’re still mired in a stalled economy and the bad debt is still out there and has not been liquidated.  And with all the success of this bailout, business now knows that future bailouts will be sure to follow, allowing them to take more foolish risks and setting us up for even bigger failure.

My View of a Green America

July 8, 2009

With all the talk of “cap and trade” and the new green industries, I thought it was time to really look at a vision of a truly “green” America, not one manufactured by political parties and big business.

First, just think about how we get electricity.  It is produced by a coal power plant, transmitted hundreds of miles, and then to our homes.  It has been this way for a century.  Most of the power we generate is wasted though, because we have no efficient way to store the excess electricity.  Is this a product of a lack of science?  No.  It is because of a lack of innovation because utilities are politically insulated companies, granted monopoly rights by our governments.

You would think, by now, every home would be fitted with solar panels that could generate more than enough electricity for the house.  You would also believe that each house would be equipped with some sort of device, be it a flywheel or another invention, that could store power generated during the day to be used at night.

Then, we could all drive plug-in hybrid cars, cutting our gas consumption to a small fraction, and using the power generated by our homes to charge the cars.

Why haven’t we gotten to this point yet?  Because as consumers, we have no choice.  We have to buy our power from our local utility.  If you even mention power deregulation, everyone always brings up the California fiasco.  However, the reason it failed is because they deregulated everything except the end user.  We were still stuck buying power from the monopolies, no matter how much they manipulated the price.  And who can blame them?  If you had a captive audience, wouldn’t you charge as much as you could?

Imagine if there was competition for supplying power.  You could buy from a solar provider, hydroelectric, nuclear, or if you wanted to save a few bucks, coal.  If we had the choice, I think a lot of people would sacrifice a few dollars a month to buy from a cleaner source.  Rather than having the government subsidize the coal plants, we would put them out of business because we want a cleaner solution.  This would cause for innovation from the coal companies to find a better way to burn the fuel.

Government restrictions and a horrible cap and trade policy cannot and will not help the environment one bit.  It will just generate revenues for the government and their partner utility companies, while charging the consumer more, and allowing the utilities to keep polluting.

In India, companies claim that they can capture carbon in huge underground tunnels.  They can then print out carbon certificates at will, and sell them on the cap and trade market.  Utility companies can buy these certificates and not have to change their ways at all, while this bogus company makes millions.

We need to be able to hold companies accountable, and if it is proven that a utility’s pollution is harming people, they need to be held accountable.  We can have the Supreme Court giving them a free pass to pollute all they want.  That’s not helping anyone.

It’s not about global warming or climate change either.  It is about creating the most efficient and cost effective source of power we can make, while polluting and wasting less.  We need innovation in the way we produce power and the only way that will happen is ending government/utility partnerships, allowing consumer choice, and letting the markets work.  Cap and Trade or any other government sponsored method will only hurt the environment and the consumers, while making the utility companies and the government itself handsome profits.

Obama Will Now Protect Us in Cyberspace, Too

May 29, 2009

President Obama can do it all.  He can fix the nation’s economy, bailout banks, prearrange bankruptcies for the automakers, and now he can protect us all from “cyberattacks” and the “epidemic of cybercrime.”  He is going to create a “cyberspace czar” to make sure we are all safe.  I say this is more needless government intervention that will not help anything at all, and will lead to a huge waste in taxpayer dollars.

All you have to do is look at the FDA and SEC.  These are two government agencies that are supposed to protect us who fail miserably.

The FDA is supposed to “keep our food safe” but they are always reacting too late.  With the last peanut salmonella scare, they forced the company in Georgia to issue a recall.  If they were supposed to be monitoring our food, shouldn’t they have caught that?  Only after people got sick did they react, and then it took a long time for them to track it back to the plant in Georgia.  What did they do to protect us?

The same goes for the SEC, who are supposed to protect investors from fraud and unethical business practices.  They had information on Bernie Madoff, that basically outlined the entire ponzi scheme, but they chose to ignore it.  They also were way behind on the Enron case, and definitely were absent when dot com companies were defrauding investors left and right.  What protecting did they do?  They talk tough about regulation and oversight, but then they miss a $64 billion ponzi scheme right under their nose.

Now the “cybersecurity czar” is supposed to protect us?  What a joke.  The last president didn’t even use email but now the White House is up to being able to monitor cybercrime?

First of all, most “cybercrime” is fraud that just happens to use the internet.  Check cashing scams and the “long lost relative in Nigeria” scams could happen anywhere.  Also, phishing schemes rely on user error, not hackers.  Unless the White House monitors every email and every click we make, they will not be able to protect the victims of these crimes.

Also, wouldn’t it make sense to leave this task up to the professionals?  There are multimillion dollar companies like Symantec, McAfee and Norton that already patrol cyberspace.  They keep our computers safe and secure.  They have the best people and are on the leading edge of the field.  What good is the government going to do competing against or marginalizing these companies?

When the government recruits their staff, they will lure workers away from these companies with high salaries, paid for by taxpayers.  This will lead to an artificial rise in the cost of labor because government is distorting the price.  This will only hurt the private companies who need to make money to survive.  Since the government can just keep printing money, they can be allowed to misallocate resources in this manner.

Instead of a czar, we need education so people know to update their computers and their virus software.  If they did not go to the phishing sites or be duped into a scheme, we’d be better off.  By creating the czar, we are saying the problems are too big to be solved and that they are just a fact of life, so we need to regulate them.  This is band-aid government at it’s best and it will just lead to a bigger waste of taxpayer money, and no benefit to society as a whole.

Obama’s Misguided Fuel Efficiency Policy

May 19, 2009

Today, President Obama announced his goal to increase fuel efficiency standards in our cars to an average of 35.5 gallons by 2016.  What he didn’t say is that he is going to keep using the horrible and unfair CAFE fuel efficiency standards and how this is going to absolutely kill the American automakers.  His policies are straight out of a “Politics 101” textbook.  They are so naive and idealistic and he does not realize that there are unintended consequences of his policies.

I’m not an expert on fuel efficiency and the auto industry, but a quick search on wikipedia for “CAFE Fuel Standards” was all I needed.  A little research showed me how the rules and regulations are broken.  Instead of addressing the root of the problem with our auto industry and efficiency standards, our President just reaches for pie in the sky goals with no regard for the blowback of his actions.

As I wrote before, the problem with the Corporate Average Fuel Efficiency (CAFE) standards is that they measure the harmonic mean of all the cars sold domestically by automakers.  Since the domestic automakers sell mostly trucks, they then have to sell – not just produce – an equal amount of crappy, fuel efficient cars that no one wants to buy in order to meet the standard.  They end up having to sell these at huge discounts or even at a loss to rental car agencies.  The Big Three lose money on every compact car they make because of labor and union costs, but make money on every truck and SUV they sell.  The importers from Asia and Europe sell mostly compact cars, so they are at an advantage.  They build these cars using the same US labor, but they are not burdened with the labor costs the US automakers are strapped with.   They can meet the fuel standards and be profitable at the same time.

On a side note, we know that US labor costs are not going to go down either.   The United Auto Workers are now majority owners in Chrysler, and will probably come out the same with GM.  With a partnership of labor and the government running the company, how can we expect labor costs to decrease?  Instead, they will continue to increase, and the taxpayers will keep giving them more money to prop them up.

But back to fuel efficiency.  I believe that we need more efficient cars, and we are already on our way there.  Hybrids are all the rage, and the automakers can’t keep up with the demand.  But are hybrids really green?  Massive amounts of energy go into producing the electric batteries they use.  I won’t get into that debate here, but the consumer demand for more efficient cars is very, very strong.

Why not just let the consumer and the market dictate fuel efficiency?  Why do we need laws created by bureaucrats to overregulate the industry?  Look at how competitive and innovative trucks have become in the last year or so.  As gas prices skyrocketed, consumers wanted fuel efficiency.  Toyota came out marketing their Tundra aggressively, and Ford, Chevy and Dodge responded.  All of the commercials touting features and miles per gallon were a testament that the market works and if consumers demand something, the automakers will listen.  It was capitalism and the free markets at their finest!

But why punish our auto industry for making the best trucks?  Even if they get a truck that can average 30 MPG by 2016, they will have sell an equal amount of compact cars that average 40 MPG to meet the tougher standard.  Or, if they can only get 25 MPG out of the truck, they will have to sell even more 40 MPG compacts.  The smaller cars are money losers for the US auto makers, so we are forcing them to make an unprofitable product.  What kind of business can succeed with that kind of regulation placed on them?

If we were to measure anything, we should measure how much progress is being made by a manufacturer for that particular make and model.  If the auto makers make a truck 250% more efficient than last year’s model, they should be rewarded.  If they can’t make money producing small compact cars, don’t force them to make them.  Let the imports fill that market and let the US automakers focus on making their breadwinners, the trucks and SUVs better.

The bottom line is that consumers are already demanding more efficient vehicles.  Let that demand drive what is produced and sold in the US.  Don’t regulate for the sake of regulating and sign the death sentence for the US auto industry.  We need real changes in the policies of our country, not more well intentioned but horribly executed Politics 101, pipe-dream nonsense from our leaders in Washington.

The GOP Needs to Embrace Ron Paul

May 18, 2009

Lately, I’ve been reading articles about the state of dissarray the Republican Party is in, and how there is a leadership void in the party.  The Republican National Committee Chairman, Michael Steele, says he’s the leader.  Rush Limbaugh wants to be the voice of the party.  Ex-Vice President Dick Cheney is going on every talk show he can trying to further push the George Bush Neo-Conservative agenda.  The Democrats have seized on this opportunity and have poked and prodded the GOP into making rash statements and decisions, further pushing them into a hole.

The funny thing, is that the Republican Party has a leader, with millions of followers, but they don’t want to acknowledge him.  The person is Ron Paul, and whether the rest of the GOP likes it or not, he is the true leader of the conservative, constitutionalist, Republican movement.  He understands the issues facing the country, and can back up what he says with his record.

All you have to do is look at all of the talk shows Dr. Paul has been making appearances on lately.  He is the only member of the GOP that is regularly on Fox, CNBC, MSNBC, and CNN.  He also set fundraising records during his Presidential campaign during the Republican primaries.  Plus, he won an NCAA basketball style bracket of GOP contenders on NPR.com by way of the votes of visitors on the site.

With the Democrats and Republicans growing closer together, with only a few billion dollars spending here or there between them, the GOP needs to separate itself and really stand up for the small government our founding fathers envisioned, and the freedom and liberty of all citizens.  With Ron Paul as the head of the GOP, we could get this country back on the right track and back to the way it is supposed to be.  If we keep down the current path, we will see less prosperity, less freedom, and more pain for the American people.  There is an answer to our problems, and the Republicans need to wake up and embrace him.

Obama’s Healthcare “Overhaul”

May 10, 2009

Update – The more I read about this “savings” plan, the more I realize that it is really a way for the healthcare companies to lock in profits for the next 10 years.  You know that any time an industry as big as healthcare voluntarily offers a deal to the government, it is really to benefit themselves.  So, rather than opening a real healthcare debate, they have preemptively offered a $2 trillion savings.  They say “savings” but it is really a reduction in the rate of growth of healthcare spending.  Since the current rate growth is 7%, they are saying that if it was only 1.5%, the country would save $2 trillion in 10 years.  That’s not savings.

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President Obama has announced an “overhaul” of the healthcare system that he touts will save trillions of dollars.  Big healthcare companies are on board as well, because they promise to only raise costs 1.5% a year.  That sounds great, that costs will be controlled, but why should they go up anyway?  This just guarantees a 1.5% increase in their revenue each year.  We should be making huge cuts that result in decreases, not capped increases.

Also, Obama’s plan basically revolves around digitizing our medical records to make hospitals more efficient.  I guess, over the next 200 years, that could save trillions, but what about the up front costs?  There will have to be an increase in cost to digitize all the records and buying equipment to store them.  Who will pick up the tab?  If the government does, then it falls on the taxpayer.  If the government doesn’t, then it will be passed on through premiums.  It’s a lose-lose for the American public.

The only way we will ever control costs and cut health care costs is going to be to get the government and big healthcare providers out of the game.  Until then, costs will continue to skyrocket, and the quality of care will continue to decline.

Obama Cuts 0.47% from Budget

May 6, 2009

Today, word came out that President Obama has cut $17 billion from the 2010 budget.  While that is a lot of money to you and me, it is a measly 0.47% of the $3.55 trillion budget that has been proposed for this year.  Surely, with the way things are going, the 2010 budget figures to be even bigger, so the $17 billion will become an even smaller percentage.

During his campaign, Obama promised to go through the budget, line by line and cut programs that weren’t working or were not necessary.  Looks like he thinks 99.53% of all the government spending is necessary.  And he’ll probably tout this as the “change” he promised and the media and all of his supporters will eat it up.  They’ll just blame the Republicans and Bush for making all the spending “absolutely necessary.”

Just when I think Obama can’t be more of a hypocrite, he does something like this.  Why even announce you’re “cutting” less than one-half of one percent of the budget?  This country is going off a cliff, and Obama isn’t putting on the brakes, he’s flooring the gas.

Washington Decides to Throw Votes Away Too

April 29, 2009

The state of Washington has joined Hawaii, Illinois, New Jersey and Maryland in a pact that will have their Electoral College votes go to the winner of the national popular vote.

So, basically, they are telling the residents of their states, that their vote doesn’t count, and that they will vote for whoever wins the national vote, no matter what.

What if Washington residents vote 90% in favor of the person who loses the national vote?  Then they send all of their electoral college votes to a person who 10% of their population voted for?  It really doesn’t make any sense at all.  It will just lead more Washington voters to stay home and not vote, because they know their vote has no bearing whatsoever.  Their votes will be controlled by the states with the largest populations, which sway the national poll numbers.

I agree that the Electoral College system as it exists now is not perfect.  It is dominated by the two parties who have rigged the rules in the states to give all of the electoral votes to whoever wins the state.  It just supports their interests, and not those of independents and third parties.

If Washington and other states want to make changes, they should split their Electoral College votes proportionally to the popular vote of their state.  That way, every vote at least has an influence.  In California, I can vote Republican every time, but I know that all of our electoral votes are going to go to the Democratic candidate.  By breaking up the electoral votes, it will reflect the will of the people, and will keep the Electoral College intact.