[Swiftwater Gazette] Of Course I'll Respect You In The Morning!

Sun Nov 1 13:56:52 EST 2009

Brad,

Seems like there's more and more writers who are starting to "get it". How
long do you suppose it'll take before the epidemic spreads to our
congressional liberals??

The idea popped into my head a bit ago that if there was a couple states
that would get together and become a Galt's Gulch of sorts, they could make
a pretty serious killing right now.

Rik

On Sun, Nov 1, 2009 at 11:08 AM, Brad Haslett <flybrad at gmail.com> wrote:

> Rik,
>
> Right after that last post, I stumbled across this (see below). Sums
> it up pretty well.
>
> Brad
>
> -----------
>
> Orphans of the Storm
>
> Posted By edgelings On October 30, 2009 @ 9:48 am In Business, Government,
>
> ORPHANS OF THE STORM by Michael S. Malone
>
>  I’m constantly amazed, and appalled, by what little actual wisdom
> I’ve actually gained in my more than half-century in this world.  But
> if there are three things I have learned, they are:
>
>
>
>   1. Never trust luck to get you through.
>   2. Don’t assume the best-case scenario.
>   3. The laws of economics, like the laws of chance, always triumph.
>
>
>
> The economic news this week, like most recent weeks, is mixed but
> mostly bad.  The good news is that the economy appears to have grown
> in the most recent quarter – at least in comparison to the miserable
> first half of this year.  The growth in unemployment seems to be
> slowing.  And, of course, the stock market has enjoyed one of its
> fastest run-ups in recent memory.
>
> The bad news is that much of this third quarter growth was already
> predicted from the artificial juicing of the economy from the
> Stimulus, Cash for Clunkers, and inventory replacement by
> manufacturers.  Take those away, and you’re down to about a 1 percent
> improvement over the disastrous second quarter – positive, at least,
> but hardly grounds for cheering.
>
> Meanwhile, the stock market rally may have peaked, and the indexes
> have begun sliding – with little indication whether this is the
> beginning of a second downturn or just a temporary hiccup.  As for
> unemployment, its growth may be slowing because we’ve already reached
> historically high levels (especially if you measure real unemployment)
> and we’re running out of people to lay-off – and those who are
> laid-off are giving up looking for work.  Perhaps most dispiriting are
> the studies that suggest that other than paying off some campaign
> debts to unions, the Stimulus generated few jobs – meaning that
> hundreds of billions of dollars of taxpayer money were spent on . . .
> nothing.
>
> In other words, about the only conclusions that you can draw from all
> of this is that, the Administration’s cheerleading aside – and that,
> of course, is their job – there is still no clear indication whether
> the U.S. economy is actually recovering, sinking into a double-dip
> recession (or worse), or sliding into the malaise of a ‘70s style
> stagflation.
>
> What does seem obvious is that the economy wants to recover.  I can
> see it everywhere around me here in Silicon Valley – companies
> (notably the PC makers) putting out great new products, entrepreneurs
> writing business plans, talented people anxious to get back in
> harness.  And I sense that’s true almost everywhere else in this
> country.  Even the stock market rally seemed like a bull banging
> against a gate waiting to be unleashed.
>
> But while we all may be ready to get back into the race, Washington –
> in whose hands our collective fate now sadly rests – may not be ready
> to let us.  And it’s all because they seem to have forgotten, or never
> learned, those three hard-earned pearls of wisdom with which I began
> this column.
>
> For example, inside the Beltway they seem to be pixilated (the old
> definition) these days with Magical Thinking.  Both the White House
> and Congress somehow believe – despite all evidence that big, top-down
> and bureaucratic initiatives no longer work in our Web 2.0 world –
> that they can grab entire sectors of our economy and impose on them a
> whole new regime that will magically work without any unexpected and
> catastrophic side-effects.  No business in America, from the corner
> dry cleaners to a Fortune 500 company would ever contemplate something
> this crazy, at least not without preparing the most detailed road map
> imaginable and getting every employee on-board – not passing massive
> and sweeping laws that nobody has read, whose consequences are
> unclear, and the majority of the citizenry is against.
>
> By the same token, the lesson I’ve learned from thirty years working
> in a volatile place like Silicon Valley is to pray for the best-case
> scenario, but prepare for the worst.  The smart companies around here
> scale up fast during the good times, but are always worriedly looking
> ahead for the next downturn.  That’s why, Cisco’s John Chambers told
> me a few months ago, he hoarded cash during the last boom – just so
> Cisco would be able to navigate through this current crash, keep its
> employees and outrun its weakened competition.
>
> The best-case scenario for this economy right now is that the Stimulus
> (or the proposed second one) actually works, the U.S. economy rights
> itself, and grows sufficiently fast over the next five years to absorb
> all of this new debt and produce enough new jobs to bring unemployment
> down to reasonable levels.  And it is upon this best-case scenario
> that we are now preparing to embark on one of the most sweeping eras
> in government-run social engineering in our nation’s history.
>
> Leaving aside any doubts you and I may have about this War on the
> Status Quo, what happens if the best-case scenario for this economy
> doesn’t come true?  What happens if the economy stagnates or falls off
> a cliff again right when we’re saddling it with trillions of dollars
> of more debt, we’re dismantling the insurance industry, driving
> thousands of doctors and other professionals (except lawyers, of
> course) out of their careers, and real unemployment is hovering at
> about 17 percent?
>
> I’ll tell you what happens – and that’s life lesson #3.  Back during
> the dot.com bubble I was running a magazine (Forbes ASAP) that was
> riding right on the crest of the boom.  Everyone in the Valley was
> getting rich, at the magazine we couldn’t write enough copy to keep
> with all of the advertising pages, and I was paying my junior staffers
> extravagant salaries.  I remember that we older folks on the masthead
> became increasingly (and properly) nervous that what we were seeing
> was a Bubble on the brink of bursting.  I also vividly remember one of
> my junior editors laughing at my concern and saying, “You’re just
> old-fashioned, Mike, you need to understand that the old business
> rules – you know, ‘profits’ and all of that – are obsolete.”
>
> As we soon learned, no they weren’t.  And they aren’t now.  And no
> amount of magical thinking or betting on luck or assuming the
> best-case scenario is going to keep those laws from re-asserting
> themselves.  You can’t print and spend mountains of money without
> creating massive inflation.  You can’t keep raising taxes and assume
> that people will continue to work just as hard or that they won’t find
> a way to hide their earnings – or they won’t move away.  You can’t
> dictate pay rates and not have the best and brightest jump to
> somewhere else where they are properly rewarded.  You can’t force
> companies to compete against government-run competitors who get to
> write the rules of engagement and expect the private competitors to
> stay in the game.  And you can’t expect private industry to save you
> after you’ve wrapped it in chains of regulation, crippled it with
> taxes and excoriated it as criminal.
>
> I stopped gambling when I realized that no matter how long a win
> streak you enjoy that eventually the laws of chance reassert
> themselves.  The same is true with the U.S. economy today:  we’re
> stretching it now and a nasty snap back lies in our future.
>
> Another storm, I fear, is heading our way – and we risk being orphans
> caught within it.  But I’ve learned one more lesson, this one from
> David Packard and Bill Hewlett (and Thomas Jefferson):
>
>
>
>   1. Trust in the ingenuity of everyday folks.
>
>
>
> The American people will get us out of this mess.  Through the
> election process, of course, but I’ll leave all of that political
> stuff to the pundits.  What I mean is that people like you and me are
> already figuring out ways on their own to get through these hard
> times.  Much of it has to do with technology.  Why pay to rent an
> office when you can run your business off a laptop and a Blackberry?
> Why pay for cable and phone in the age of Skype and Hulu?
>
> How many people out there are building small enterprises off Facebook,
> eBay and Craigslist?  Or marketing with Twitter?  Or designing apps
> for the iPhone or Android?
>
> Meanwhile, the tools are in place to form small (150 people or less)
> sub-markets in which you buy and sell – or barter — from each other,
> or team up to buy common items at discount.  Or to team up and sell
> your services around the world virtually.  Or move somewhere else
> where the taxes aren’t so onerous, and still keep your current
> clients.
>
> And why keep working past the point when the government takes it all
> away?   Why not use the remaining time – and a good network on some
> place like LinkedIn – to try your hand at entrepreneurship and build a
> virtual start-up company?    And when inflation hits, you may find you
> make more money sitting at home at your computer arbitraging and
> investing the wealth you have than actually working for an ever-less
> valuable paycheck.
>
> In other words, even if Washington no longer believes you can make
> intelligent decisions for yourself, it doesn’t mean you can make them
> anyway.  And even if our leaders have chosen to be foolish, it doesn’t
> mean that you can’t choose to be wise.
>
>
>
> [For a decade of Michael S. Malone’s columns about business and high
> technology, please visit www.abcnews.com]
>
> On 11/1/09, Rik Sandberg <sanderico1 at gmail.com> wrote:
> > Yabut .... do ya think anybody listened? How many of the legislators do
> you
> > think actually got it.
> >
> > I can hear that giant sucking sound and it's coming from California.
> >
> > Rik
> >
> > On Sun, Nov 1, 2009 at 8:58 AM, Brad Haslett <flybrad at gmail.com> wrote:
> >
> >> Rik,
> >>
> >> Can't remember if I posted this or not -
> >>
> >> http://tinyurl.com/yhh3ad7
> >>
> >> What great advice!  DO NOTHING!  GO HOME!  JUST STOP!
> >>
> >> Brad
> >>
> >>
> >> On 11/1/09, Rik Sandberg <sanderico1 at gmail.com> wrote:
> >> > Ha ha .... Will the last one leaving California, please turn out the
> >> > lights??
> >> >
> >> > _______
> >> > "People can get out of this," she said, noting that most people would
> >> > have to change their allowances through their employers. California's
> >> > budget leaders are banking on the hope that most won't."
> >> > _______
> >> >
> >> > Good grief, I sure hope nobody takes that advice without doing the
> math
> >> > first. I really HATE when people have to get a loan to pay their taxes
> >> > on
> >> > April 15th and that's exactly what it'll come to if they take this
> >> woman's
> >> > advice. First (and maybe the biggest) problem they're going to run
> into
> >> is
> >> > finding someone that will even make them a loan. Oh wait, I forgot,
> they
> >> can
> >> > just put this bill on their 30% interest credit card and make minimum
> >> > payments :-)
> >> >
> >> > Dumb and dumber.
> >> >
> >> > Rik
> >> >
> >> > On Sun, Nov 1, 2009 at 8:19 AM, Brad Haslett <flybrad at gmail.com>
> wrote:
> >> >
> >> >> Good grief!  Has it ever occurred to anyone in California that they
> >> >> have a spending problem, not a revenue problem? Watch how this goes
> >> >> because the entire nation is heading down the same path.
> >> >>
> >> >> Brad
> >> >>
> >> >> -----------
> >> >>
> >> >> latimes.com
> >> >> California to withhold a bigger chunk of paychecks
> >> >> The amount goes up 10% on Sunday as Sacramento borrows from
> taxpayers.
> >> >> Technically, it's not an income tax increase: You'll get the money
> >> >> back eventually.
> >> >>
> >> >> By Shane Goldmacher and W.J. Hennigan
> >> >>
> >> >> October 31, 2009
> >> >>
> >> >> Reporting from Los Angeles and Sacramento
> >> >>
> >> >> Starting Sunday, cash-strapped California will dig deeper into the
> >> >> pocketbooks of wage earners -- holding back 10% more than it already
> >> >> does in state income taxes just as the biggest shopping season of the
> >> >> year kicks into gear.
> >> >>
> >> >> Technically, it's not a tax increase, even though it may feel like
> one
> >> >> when your next paycheck arrives. As part of a bundle of budget
> patches
> >> >> adopted in the summer, the state is taking more money now in
> >> >> withholding, even though workers' annual tax bills won't change.
> >> >>
> >> >> Think of it as a forced, interest-free loan: You'll be repaid any
> >> >> extra withholding in April. Those who would receive a refund anyway
> >> >> will receive a larger one, and those who owe taxes will owe less.
> >> >>
> >> >> But with rising gas costs, depressed home prices and double-digit
> >> >> unemployment, the state's added reach into residents' regular
> paycheck
> >> >> isn't sitting well with many.
> >> >>
> >> >> "The state's suddenly slapping people upside the head," said Mack
> >> >> Reed, 50, of Silver Lake. "It's appalling how brash that is."
> >> >>
> >> >> Brittney McKaig, 23, of Santa Ana said she expects the additional
> >> >> withholding to affect her holiday spending.
> >> >>
> >> >> "Coming into the holidays, we're getting squeezed anyway," she said.
> >> >> "We're not getting Christmas bonuses and other perks we used to get.
> >> >> So it all falls back on spending. The $40 gift will become a $20
> >> >> gift."
> >> >>
> >> >> The extra withholding may seem like a small amount siphoned from each
> >> >> paycheck, but it adds up to a $1.7-billion fix for California's
> >> >> deficit-riddled books.
> >> >>
> >> >> >From a single taxpayer earning $51,000 a year with no dependents,
> the
> >> >> state will be grabbing an extra $17.59 each month, according to state
> >> >> tax officials. A married person earning $90,000 with two dependents
> >> >> would receive $24.87 less in monthly pay.
> >> >>
> >> >> California will probably continue to collect the tax at a higher rate
> >> >> for many years -- or find an additional $1.7 billion to slice from a
> >> >> future budget, an unlikely occurrence. All workers who have state
> >> >> taxes withheld will see their paychecks shrink.
> >> >>
> >> >> "Many families are sitting at their kitchen table wondering how
> >> >> they're going to make ends meet," said state Sen. Tony Strickland
> >> >> (R-Thousand Oaks). "At the same time, the state of California is
> >> >> taking a no-interest loan."
> >> >>
> >> >> The provision is one of numerous maneuvers state lawmakers and Gov.
> >> >> Arnold Schwarzenegger approved in the summer to paper over the
> state's
> >> >> deficit. Many of the changes, including the extra withholding, were
> >> >> little noticed outside of Sacramento.
> >> >>
> >> >> Savvy taxpayers can get around the state's maneuver by increasing the
> >> >> number of personal withholding allowances they claim on their
> employer
> >> >> tax forms, said Brenda Voet, a spokeswoman for the state's Franchise
> >> >> Tax Board.
> >> >>
> >> >> "People can get out of this," she said, noting that most people would
> >> >> have to change their allowances through their employers. California's
> >> >> budget leaders are banking on the hope that most won't.
> >> >>
> >> >> The increase is coming at a bad time for store owners, many of whom
> >> >> depend on the holiday shopping season to keep their businesses alive.
> >> >>
> >> >> "I don't think there's any question it's going to impact consumers'
> >> >> spending," said Bill Dombrowski, president of the California
> Retailers
> >> >> Assn. "Any time you reduce people's disposable income, there's going
> >> >> to be a negative effect on the retail sector."
> >> >>
> >> >> But Stephen Levy, director of the Center for Continuing Study of the
> >> >> California Economy, wasn't so sure.
> >> >>
> >> >> "It's having a relatively small impact on people's income," Levy
> said,
> >> >> pointing out that many families will receive only $12 to $40 less
> each
> >> >> month.
> >> >>
> >> >> Yet Erika Wendt, 28, of San Diego said she already lived on a tight
> >> >> budget: She rides her bike to work, for instance, to save on gasoline
> >> >> and parking costs.
> >> >>
> >> >> "I am frustrated as this directly impacts my weekly budget -- what
> >> >> groceries I buy, how much I drive and can spend on gas," she said.
> >> >> "Now money will just be tighter, and I'm not sure where else I can
> cut
> >> >> back."
> >> >>
> >> >> The extra withholding comes in addition to tax hikes the state
> enacted
> >> >> this year.
> >> >>
> >> >> In February, state income tax rates were bumped up 0.25 of a
> >> >> percentage point for every tax bracket. The dependent credit was
> >> >> slashed by two-thirds. The state sales tax rate rose 1 percentage
> >> >> point. The vehicle license fee nearly doubled to 1.15% of a car's
> >> >> value.
> >> >>
> >> >> Lawmakers and the governor also approved deep cuts to schools, social
> >> >> services and prisons to fend off one of the steepest revenue losses
> in
> >> >> California history.
> >> >>
> >> >> Temporary budget bandages, such as the increase in withholding, were
> >> >> included at several points this year to avoid higher taxes and deeper
> >> >> cuts, said H.D. Palmer, a spokesman for the state Department of
> >> >> Finance.
> >> >>
> >> >> Sacramento, meanwhile, is awash in red ink again. The state
> controller
> >> >> recently said revenue in the budget year already had fallen more than
> >> >> $1 billion short of assumptions. Outsize deficits are projected for
> >> >> years to come.
> >> >>
> >> >> Such temporary measures as the withholding tax increase don't really
> >> >> fix the budget gap, "they just more or less hid it," said Christopher
> >> >> Thornberg, a principal with Beacon Economics in Los Angeles. "I call
> >> >> it a fraud."
> >> >>
> >> >> shane.goldmacher@ latimes.com
> >> >> _______________________________________________
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> >> >>
> >> >>
> >>
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> >> >>
> >> >
> >> >
> >> >
> >> > --
> >> > Never argue with idiots, they just drag you down to their level then
> >> > beat
> >> > you with experience.
> >> >
> >> _______________________________________________
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> >>
> >>
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> >>
> >
> >
> >
> > --
> > Never argue with idiots, they just drag you down to their level then beat
> > you with experience.
> >
>
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-- 
Never argue with idiots, they just drag you down to their level then beat
you with experience.
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