Hostile Territories

Global oil is nearing peak production. This is my assertion. It's as much a wish, really, as it is founded in reality. There is no doubt that US production has been declining since 1970...the same with Mexico, Ecuador, Indonesia, Great Britain, and others. But its detrimental effect on our economy is substantiated simply as a wish. Truthfully, I wish for complete chaos, financial Armageddon, a collapse of our current way of living.

I wish for this, not for the during, but for the end result. My expectation is that we become a better people. We may well learn to sustain ourselves on our own ingenuity and our own productive efforts again, unlike the current state of affairs where we blame others for our woes, blame our economic malaise on big banks, big government, competing nations...everything but ourselves.

It has been my wish for a few years now that global peak production in oil will be the catalyst for this change, because nothing else will do it, methinks. Consider that our multinational oil companies have to venture into ever more hostile territories to get the energy us Elk Grovians need to drive to our malls to conduct our annual rituals of wanton consumption. Indeed, these environments are more hostile both physical and political every day. To understand the physical and environmental costs, travel to the Alberta oil sands. To consider the political costs, travel to the Niger Delta.

Oil costs more to produce in the exact same way that health care costs are increasing. These two components will consume a growing share of our GDP going forward, and in my opinion, as we continue to increase our dependency on both we will continue to erode our standard of living for all but the extremely wealthy. The trajectory of the price of energy is structurally up.

My hopes for a different sort of America are clear, although I really hold no expectations that they will ever materialize. I want a future America that doesn't pin its short term economic hopes on the consumptive sales of imported merchandise around the supposed birthday of a spooky, incompetent Father figure. I want a future America that values community. I want a future America that values workmanship and pride in manufacturing. I want a future America that uses only as much energy as itself produces instead of relying on a growing share of foreign resources. I want a future America that doesn't have to invade, bombard, or occupy other nations for hegemonic needs.

No. My expectation is that we will self-destruct well before we reach any of these markers, because we can't help but assume ourselves as somehow privileged, somehow exempt from the articles of natural limits. This is exactly why I hope for a total meltdown...so that we become a people who can recognize our proper place in a sustainable future. We are not there yet, not by a long shot...

Desensitized

Do you remember how, not so long ago, $90 oil was going to kill our economy? Airlines would stop airlining. Trucks would stop trucking. Automobiles would stop mobiling.

Now that's it has gone down in price from two years ago, our memory of cruel, awful, and icky four dollar gasoline has waned. $3 bucks? Yawn...

Apparently that's the best way to desensitize Americans to their own diminishing domestic supply of gasoline -- let the price rise quickly, let it ride down slowly, then slowly raise it back up to a higher level, to where they're saying "at least it's not as bad as before."

Interestingly, three dollar gas is now the norm and we go about our daily business here in Elk Grove without much concern. Yeah, it's now sixty bucks to gas up the Pacer, but it's just another cost of suburban living. That it goes up, well, at least it's consistent with health care premiums, state university tuition, insurance premiums, airline fees, subway fares, cable TV, copper, and garbage collection services.

Gas prices and the weather -- two things two Elk Grovians strangers are wont to discuss in an elevator ride...er, scratch that...there are no elevators here in the land of single story, single use sprawl. Sorry. Just gas prices. The thing two Elk Grovian strangers are wont to discuss in the checkout lane at WalMart.

Today I will get on the bike, off to a late start due to the Winter Solstice and its later sunrise, and I will pass six gas stations on my route. I should take photos of the people filling up -- would you expect smiles on all their faces? Something they love doing? The expressions of fillers are identical to the universal expression of airport janitors...have you ever noticed that they are all the same?

This is desensitizing writ large.

Buy China

I don't think there's anything to take away from last week's extension of 13-months of unemployment, the 2% SS tax cut, and the extension of the Bush tax cuts. The extension of the tax cuts booby traps us on election-eve, 2012...where Congress and the President, seeking re-election, will be so spooked and will have no choice but to extend them even further.

I think that if you were to go back to 2000-1, when Bush entered office and we were [just] running a surplus, the tax cuts were approved "because there's a forecasted $5 trillion surplus over the next ten years, so let's give that back to the American people." Instead of any projected $5t surplus, of course, we got two unfunded wars, a Fed-engineered housal unit boom and bust, associated stimulus, er, bank bailouts and now this $800,000,000,000 tax cut extension, all that will have landed us another $5 trillion in the hole -- a $10 trillion swing.

We've "grown" our economy on personal debt and now we're "growing" our economy on Federal debt. Based on this Federal debt pattern, I believe social security won't provide me much by the time I'm eligible -- not because I think it's going to turn up insolvent (though it might), but rather I think by then changes will be made such that my entitlement will be means-tested. The more income/assets I have, the less I'll be entitled, which is to say that because I've saved money on my own I therefore don't need quite so much.

Thus! I will accept this 2% payroll tax cut with glee! That it's not going to social security that won't provide me anything anyway, well, I have a plan for that money.

I am going to spend my ~$900 relief on shit from China, that's exactly what I'm going to do with it this year, and I will document it here on my monologues. I will go out of my way to buy Chinese...er...well, I won't really have to go out of my way, but you get the idea. What, you think I'd be stupid enough to save this? Why would I? Why should I save this social security payment relief? To have it help reduce my future social security entitlement?

No, I'll support the American dreams of millions of retail sales associates who depend on the selling of Chinese shit for a living -- a growing percentage of our workforce. I will use my American social security "stimulus" to help drive the dwindling 11% manufacturing base of our nation to 10% by year's end. Hey, I've always called for a bleak future...might as well stop blogging about it and actually do something to promote it, eh?

Stages Of Grief

Where would we fall on the Kubler-Ross model, if we believed we (the United States economy) were a terminal patient? Everyday we progress forward with falling GDP, rising and perpetual government borrowing, rising health care costs and falling personal health standards, I wonder where we fall in the five stages of grief:

Denial -- well, most certainly we fall into this tranche 6 days a week: "The fundamentals of our national economy are just fine." "It's just a temporary slump, as all recessions have been." "Prozac and reality TV will keep our economy running, just you wait and see. You'll see."

Anger -- Maybe just two days a month we fall into this bucket: "Those fucking Indians and Chinese, stealing all our jobs!" "We need a 100% tariff on imported goods." "Why us?" "Aren't we God's chosen economy?" "Who's to blame? Goldman Sachs!"

Bargaining -- Only one day each month we try to cut a deal with said God, or as it would be, our government: "If only we could get another thirteen months of unemployment...we'll have jobs by then." "We only need another seven hundred billion more, that's all -- we get that next seven hundred billion and we'll make it out of this, just you wait and see. You'll see."

Depression -- Also only one day each month: "We'll never get out of debt, Suzy." "Our bills are just too high." "Why bother working when bankruptcy is our only option?" "We're just piling debt onto our grandchildren, they'll have nothing."

Acceptance -- So far, not a single act of acceptance has occurred: "We realize that living within our means is the correct thing to do." "Today we announce sever austerity measures that wi..."


Nope, not a single act of acceptance yet. We've still got a long way to go on our ride on the little grief trolley.

Deficits Don't Matter

I simply cannot resolve the cognitive dissonance developed when I read this from our representatives in the U.S. Congress:

"Republicans and some moderate Democrats want all the [Bush tax] cuts extended, saying that raising taxes during an economic slump would be disastrous."

Yet, didn't these same tax cuts exist all throughout the supposed boom years between 2001-2007? And what, exactly, did those provided us, huh? An entirely hallucinated economy borrowed from the future. All the wealth created over those several years was entirely hallucinated -- this supposed wealth never existed. Every goddamn day we hear how we've lost ~$x.x trillion since the peak, but indeed, no one ever questions if this wealth was even real. It was a paper loss on wealth than never existed. My dad would say these were Chinese dollars. I would agree with that characterization.

Republicans who believe that tax cuts ought to be extended for the uber-wealthy during a slump are, in my opinion, misguided. Misguided, because there has never existed in this grand nation a greater wealth disparity than now; misguided, because I don't believe there is a true correlation between slumpy job creation and tax credits for the wealthy. Tell me -- with seven trillion in Obama stimulus over the past two years while the Bush tax credits were still in effect, why did those 7 million jobs disappear? What, it was something other than those tax cuts?

I am totally blown away with Obama's compromise this week; not because he compromised, but because all three major themes a) extension of all tax cuts, b) dropping the SS tax by 2% and c) extending unemployment benefits ALL THREE! come from borrowed money. Have we not learned one damn thing from this recession? That borrowing and spending money you can't pay back caused it? That continuing to do so is a guaranteed recipe for future disaster? The tea party? Their silence on this new $700,000,000,000 added to the national debt is deafening.

I can't tell you how much I enjoy all this political bullshit; it will keep me blogging up until the day this nation self-destructs. And it will likely occur now sooner than later -- we cannot resolve our perpetual, annual federal trillion dollar deficits; we cannot resolve our fourteen [and soon to be sixteen] trillion dollar national debt; we cannot resolve our $22 billion dollar state deficit. We cannot resolve our personal credit card and housal unit mortgage balances. I would most certainly enjoy watching this grand nation of ours implode into a bankrupt second world republic. Think of the classic traits of banana republic finance -- massive (and chronic) government debt issuance -- reckless monetary expansion to absorb it -- and economic distortions that lead all wealth to flow uphill to the top of the economic ladder. Sound familiar?

I want us to fall apart, solely for what we'd gain from the experience -- we'd become a better people, a people who'd value work over consumption, who'd value energy and learn to live in a stable, productive society that uses a fraction of the energy we currently consume. We'd reverse this trend where over half the adult population will be obese by 2025, because we'd reverse the social trends of instant-gratification and self-glorification that are (as best as I can tell) the underlying causes. We'd value neighborhoods, value our neighbors, value our relationships with them. That is, after the really bad shit we'd have to go through during the implosion.

As for these tax cuts -- I really could care less about their extension, because either way, I'm assured our elected officials will again fail to address the true causes of our problems and will never be able, politically, to suggest we take the austere road out through gasp! eliminating debt and productive effort. No -- we add another trillion on top of the trillions already borrowed to put off real reform farther down the road, to future elected officials who won't do it either. Think about it -- any elected official who even suggests that we reduce entitlements for today's populace is doomed to defeat; he/she will easily be defeated in two to four years by others who continue to push up trillion dollar deficits.

We just increased our national debt by seven hundred billion, just in one day, and you can rest assured that this will eventually rise to well over a trillion because of our fantastic accounting measures we use. I've a theory regarding why our government did what it did; our representatives cannot take the hard road because it is political suicide when the American electorate are cultural adolescents.

We have learned absolutely nothing from trying to maintain an energy intensive, consumptive lifestyle on home equity, credit cards and personal loans -- money we didn't have. We've instead shifted the borrowing to the federal government, which by itself tried to maintain two energy intensive wars along with Medicare and Social Security entitlements...all with borrowed dollars. We accept this because of our cultural adolescence -- we cannot accept we've been living on borrowed wealth.

We had thirty years of fake wealth -- thirty years of surplus sloshing around as a result of re-fis, equity lines, equity appreciation, such that there are whole segments of our nation who can live off this surplus, based on the labors of others. The 1960's counter culture couldn't have existed without all that surplus, without an underlying oil-based economy powering it. Yesterday I saw the same thing in the Telegraph area in Berkeley -- whole segments living off the slosh of surplus. Today it isn't quite so obvious but it's still all around us - with million using EBT, social security disability, on and on. People living on borrowed moneys that represent our national surplus wealth.

Lower Wages, Always

"City officials desire large businesses to set up shop in EG"

Headline from an edition of the Elk Grove Citizen last week. This can be read any number of ways, but the way I read it is always the same: car dealerships and large format retail. These twin economic engines will supposedly power our city for the foreseeable future.

What I find most disingenuous is our mayor's comment about small businesses: "[they] are the fabric and the foundation of our community. They always will be."

It is small business that are destroyed with the monoculture of big box retail, the monoculture supported and expanded by the city council. Old Town Elk Grove slowly hollows out as WalMarts and Targets and Kohls and Old Navies are erected near our multiple easy-access freeway interchanges. Car salesmen indeed benefit as commutes to these consolidated consumption centers are increased. Sooner or later, the only jobs in the city will be truck drivers between the Port of Oakland and WalMart, retail sales associates, stock boys, and Chinese-made Hot Wheel assemblers for the holiday crush. Yes, there will be the odd regional sales manager or two, those that will earn more than the city's AMI of $55,000, but they will be fewer and farther in between.

It isn't just about "lowest prices, always;" it's about the loss of identity, of community, of affluence, of diversity, and of the dignity of work.

We lose our identity. In a city full of the same out-of-town owned corporate big box retailers as every other city, where Folsom has the same Office Depots, etc., there is nothing to distinguish Elk Grove. Does this matter anymore? Obviously not -- but I argue that if we had a set of independent grocers, with a larger share of their products produced locally, we could hang our hats on places like these. They would likely be more expensive, yes; but the beekeeper in Wilton will still stay employed and would more likely engage you in what you do for a living.

We lose our community. In a city that has only developed the single use zone model and that has only ever approved large subdivision tract homes, where we live has lost all meaning. The Target store becomes our de-facto community center, the only place where you're apt to run into your neighbor...if you even know what your neighbor looks like. You likely don't, not when he (or she) opens the garage door remotely, drives in, and closes behind him (or her, it's hard to know). No engagement. No gossip. No shared knowledge.

We lose our affluence. There are only a few willing to discuss how the American wage-earner has been losing purchasing power over the past thirty years...coincidentally with the emergence of the same "lower prices, always" model of large format retail. You can buy a lot of really cheap shit nowadays, yes, but you have to continue to buy things as they are poorly built, negating any long term savings. We lose our affluence as a nation as the majority of new jobs exist in the support of strip retail, with their concomitant "lower wages, always." We have never seen such a concentration of wealth, and this may not bother you too much as you can always aspire to join them. The middle class is critical, however. The lower classes pull much more in services than they produce; the upper class has the ability to grift, to find waivers, to use guile and privilege to keep their wealth. The middle sustains this nation, and employs the most. As we lose more and more manufacturing jobs at the same time as we develop more and more jobs in the support of corporate or in the support of retail sales, we lose affluence. A small business in Elk Grove doesn't need a human resources department. It wouldn't need an assistant to the vice president of marketing, nor would it need project managers or coordinators. These jobs don't and never will produce anything; they are only in support of a dwindling cadre other productive employees. It isn't hard to understand that if the only job you can get is in retail sales you aren't going to be as affluent.

We lose our diversity. The beekeeper in Wilton, if he had a network of independent grocers in Elk Grove to sell his product, could do so and sell at a price that might support a modest lifestyle. His income would flow back to you as he spends his money on your service or what you make. Importantly, there would also be choice in what products were made available. This beekeeper would have absolutely no ability to fly to Bentonville to pitch his wildflower honey to corporate buyers and unless he can produce twelve million units annually at a price dictated to him, he'll never find his products in the Super WalMart. His honey can never be made available to Elk Grovian moms whose only fucking consideration when buying honey is that it's as cheap as possible -- that it's produced by Tibetian bees makes no never mind. The Wilton beekeeper can't support his passion, his craft, and has to supplement his income by stocking Target shelves on the swing shift. Product diversity is destroyed, which coincides with the loss in retail diversity.

We lose the dignity of work. "It's a job, man." That's all that counts these days. Fewer and fewer people take pride in their efforts when there's no personal attachment to the things they are trying to sell or the places they sell them at. If the Target on Center Parkway pays $.35 more an hour than the Lowe's, that may be all the incentive needed to change employers. At least, that's what it used to be back during our boom years. Today you might be a little more hesitant. "I've got a job, man." There is much less dignity, in my opinion, in assembling box after box of Chinese made bicycles than working in a local bike shop maintaining customer's quality made bikes. It's more exacting, it's skilled, it pays more, it doesn't support wanton consumerism, it keeps dollars in the community, and above all it's possibly satisfying. Where there is pride in what you do, your output is superior, regardless of what you do.

These are the things we lose as our Elk Grove city officials conduct municipal visioning studies that mandate big box retail as the greatest potential for growth -- our economic saviors. These things used to be ingrained in our collective experience, but they are increasingly no longer. Again, I see Mayor Sherman's lip service to small businesses as correct, but her actions have only worked to destroy them going forward.

Re-hire and Fire

I'm again on the fence regarding the re-re-re-re-re-extension of unemployment benefits. On one hand I think of how many people are staring into the abyss, but on the other, the extensions are simply augmenting familial unit income that will never be replaced.

Case in point: my co-worker's wife, who after delivering her latest baby has no intention on returning to the workforce. Indeed, once her benefits expire, she'll no longer be included in the participation rate, and as such will no longer be included in the unemployment rate. I find this notion intriguing; the day her benefits stop, the unemployment rate will also drop by one person. If there are 100 working people and 20 of them are unemployed and pulling benefits, the unemployment rate is 20%. If benefits expire for 5 of them yet they don't look for work as they weren't planning to, then the rate magically drops to 15%. Nothing has changed...but the rate is reduced.

Accounting like this is why the U3 rate, the official rate, is a rather useless indicator in my mind. It's also why mark-to-fantasy accounting is the preferred method of asset valuation at all the major banks...because it's bullshit, but it makes them appear more solvent than they would be otherwise.

My co-worker's wife -- she'll obviously draw on this for as long as humanly possible, as any of us would. The argument is that "we've already paid into it, so we feel we have the right to a return of those payments." Fair enough. But then I hear of an interesting way to keep her benefits extended:

She will "seek" employment on a ranch that her relatives own. She'll pay the rancher $3,000 to "hire" her, where she'll "work" for three months on the ranch's payroll which gets returned to the rancher. The rancher pays unemployment insurance premiums, and when he "lays her off" after those three months she skips on down to the unemployment office to file for unemployment benefits while the rancher doesn't contest it. The rancher doesn't lose anything; indeed, is able to write off her wages while the initial $3,000 covers those ancillary costs of social security wages, etc. and leaves some for himself for his efforts. She'll get a return on that $3,000 within just a few months while the benefits continue to get re-re-re-re-re-re-re-re-re-extended by the already broke government. Obviously this won't provide for nearly the same level of benefits, but it's something. Gas money. A few dinners out. New sneakers for the kids. What have you.

I'm pretty sure I don't have the facts straight on this type of abuse, but I can be assured that many people have long ago figured out how to extract every possible dime from such government programs. It is for these people that I wouldn't mind seeing 99 weeks as the ceiling for these checks.

Borrowed Time

I don't find it strange that it's taken our representatives over thirty six months -- as long as I've been blogging -- to even begin to address American structural indebtedness, let alone take any actions to reverse our three decades long debt fueled lifestyle.

No, I don't find it strange. We have failed to address it for almost as long as I've been gravitationally tied to this rock. There is no coincidence, as I've mentioned multiple times here, that my city government, my county government, my state government, my federal government, and the vast majority of my neighbors are all up over their eyeballs in debt.

This Simpson-Bowles commission -- I don't see it doing a damn thing. Extending the age of social security recipients out to the year 2075?

Really? What about 2005? What about 2015?

Not only doesn't this address the problems at hand, there is no way, no way, we're going to get any reduced spending/increase in taxes with a split Congress...as evidenced by our failures to get any reduced spending/increase in taxes at any time Congress was partisan. We won't do it, we won't take the haircuts we need because we know what the end result always is; we can't accept the fact that we've been living beyond our means.

This nation's constituents don't have any idea , not even close, what it means to live below their means.

For the past five thousand, five hundred days I've known what it's like to live on borrowed time; at any other time in human history I would have been dead from juvenile diabetes for that long. Every day going forward is, in some sense, borrowed. This helped shape my personal financial outlook -- live within my means, live to where I don't need insurance because I'd never qualify for it, and so on. As a consequence, I don't [yet] have the Yukon in the garage with the $6k tires/wheels.

Interestingly, during the decade long Bush tax cuts, what did we do with all that increased personal income? How is it that we are all so broke? Not only that, we have nice aftermarket rims on our social security program, on our medicare, on our medicaid, on our soldier's MRAPs, but we've not yet paid for them.

I see at least two years of paralyzing inaction by our federal government to address any of this shit. We are too polarized to compromise; we won't. We cannot accept reduced services while we cannot pay for them, and that I see portends a rather bleak future for most of us.

Adult Bibs

I admit I have a bad relationship with food -- I know how to eat too much of it, just like the rest of America. but I'm also type I diabetic and this has a strong influence on my excessive eating. I really wonder what I'd be consuming if I weren't diseased.

I see this wrapped around my newspaper this morning

and I actually take comfort in my own diabetic condition -- over time I've taken efforts to eat correctly that I might not have otherwise. I don't know what it's like to take Peptol Bismol. I certainly don't know what it's like to take it every day, as many of you do.

Indeed, a friend of ours who attended Thanksgiving at my in-laws last night was hospitalized this morning after having puked all night long...after having taken in a massive, massive quantity of food at the annual turkey day affair. Now, she was diagnosed with a small kidney stone -- really, not necessarily related to her day of binge eating...but I can't say it wasn't.

I've a brother-in-law who suffers from diverticulitis. His wife recently had her gallbladder removed following what looked to be a rather uncomfortable bout of distress. Should this be normal? Should every newspaper delivered on Black Friday be housed in a makeshift pink bib? I am blessed to have never suffered from gastrointestinal distress. I wonder, though, if it's just luck or if it has to do with eating less than the world's average production of meat, if it has to do with proper food combining, if it has to do with eating a diet of mostly plants. These things I do fairly regularly.

Obviously we don't have ultimate control over disease. I admit my likelihood of dying from lung disease riding my bicycle to work most days. But I look over our America and I know that Prilosec and Tagamet are among the most prescribed medicines, and I look out over our America and I see how many surgical procedures are performed to correct for our rich Western diet, and I have to wonder -- how much of my future productive effort will be used to provide universal health care for American diets known to cause disease? How much of my future productive effort will be used to pay taxes to subsidize meat and dairy industries that are known to cause disease?

In 2008 here on my blog I asked: Does a non-smoking vegetarian female state-university educated triathlete deserve to pay taxes to support the universal health care for a viable yet SS-disabled Tamiroff-swilling pack-a-day smoking Kraft-mac-and-cheese-eating type-II-diabetic beefeater who hasn't raised his heartrate above 100 since gradeschool? At what point does/should behavior influence these decisions? Should it not? Should we all just hope that there will be enough contributors to assist those who eat like shit? I mean, we do this everyday with our marginal tax system -- those who earn more pay more. This isn't any different, is it?

And I ask, should my health insurance rate rise more than 20% over the past two years for bicycling to work, for eating well, for managing my diabetes correctly? Perhaps it should. In any event, it most certain has.

National Consumption Day

In better times, 26% of us would go out today and buy shit for ourselves. These days it down to 11%. But hey! It's up from 9% last year! Wa-hey! This is the benchmark we use to define the health of our economy? I suppose it is.

Does Germany have a national consumption day?
Does Japan have a national consumption day?
Does Algeria have a national consumption day?
Does New Zealand have a national consumption day?
Does Bangladesh have a national consumption day?
Does Paraguay have a national consumption day?

I really don't suppose to know all their national holidays...but my guess is...no.

I do admit -- I went out and consumed this morning. I went to Bikram Yoga in an attempt to keep the Thanksgiving stuffing in check, and I think overall I did a good job of it this year.

Yep, I thought today would be a perfect day to get out there -- cold, a holiday of sorts, a day off, and I supposed I'd have no company on the roadway.

Boy, was I wrong.

Minivans with Samsung and Panasonic wares strapped into the back seats. Trucks with appliances in the back. I passed the Best Buy and wondered how all those people who were turning into the lot were even going to find a spot. My guess is that today, more fat women will burn more gas today than during any other day of the year -- as they endlessly circle the parking lots of our consumption centers looking for that close-in stall.

What we fail to understand, collectively, is that Thanksgiving through Christmas retail sales run about $754,276,600,035 on average, in a $14,352,192,883,060 economy. 4%. It really ain't shit, but it's all we can do to pin our economic hopes on these sales. The other 96% doesn't garner nearly the same attention that's lavished on post Thanksgiving sales.

I liked the fact that I spent the day yesterday eating a vegetarian meal (although I deep fried a turkey), today I worked it off at yoga and then blogged about the crush of consumerism going on all around me. Here I sit and it's rather quiet today, no football on TV, trying to think about what the rest of my day will bring. A nap? Does the pot garden need tending? Rake leaves? For me, it takes very little in the way of consumption to survive, to thrive. Yes, I own a computer, a TV (not yet HD), cars, bikes, a rake, etc., but since 2007 I've offed a large volume of personal possessions and I've not once looked back. I don't collect things anymore; no stamps, no beer bottles, no trinkets, no strawberry-themed kitchen gadgets, no magazines, nothing. What I like is to own things that can be used to produce other goods. Wort boiling equipment. Tools. A quality, US made pair of scissors.

Everything being purchased today, this Black Friday, virtually everything, cannot be used to make other things, or they have no utilitarian value. Electronica. Teapots. RC airplanes. Perfume. A hoe.

There is value in consumption; I mean, at some basic level we all have to do it. When it becomes wanton, then I take issue.

Four More

I believe, and have continued to believe that we are in the midst of a great deflationary period. Rising prices are not the only measure of things. We lived through a massive credit expansion over the past three decades -- credit that created excess claims to the same real wealth.

What are our stores of real wealth? Natural resources. Housal units. Factories. But all of these are in or are heading into decline. We are in an inexorable decline in our domestic oil production. We built twenty five years worth of commercial strip malls and housal units in under a decade. We eviscerated our manufacturing base to save a few dollars on bedsheets and coffee makers imported from Asia.

The claims made on these units are being extinguished...and at a rapid pace. And, there isn't any growth in the underlying wealth of these units. Indeed, I don't see much growth in American wealth whatsoever. What, do you see any? Where? Do you see any growth in the American manufacturing base? We grew our economy on the rise in digital technology and housal units -- both of which are overdone. I believe that we are living through a collapse of credit, which is nothing more than a future claim to this supposed wealth.

Thus, I see debt as a millstone around your neck. Real interest rates are high even while the nominal rate is low because inflation is negative (or very close to negative). The real rate is the nominal rate minus inflation...and so becomes greater than you'd think. Paying down debt is the best thing to do.

I look around me and people really aren't paying down their debts...not to any degree. Sure, my neighbor's housal unit debts are being drawn down at a few hundred per month collectively, but there's a new Lexus in my neighbor's garage -- a new SUV across the street. The guy I hunt with now owns at least another $20,000 in debt for his new truck. In every case, these people's old cars were adequate.

Today, Friday, I got paid and the first thing I did at the top of the month is blow a wad to the mortgage. It's a forced savings account, because once you draw it down, you can't easily get it back. Not like a bank account that's far too easy to raid for a vacation, a new floor rug, or new diamond earrings, when you don't maintain any fiscal control. As I watch all my neighbors increase their overall level of debt in this economy regardless of whether or not they have fair employment, I can only assume they aren't fiscally prudent.

I just blew money into the mortgage, and as of this morning I have four payments left. I barley have enough in savings to pay this damn thing off if I wanted to -- telling you how illiquid I am. But I'll soon be debt free, and that is something I've worked towards for a very long time and worked diligently. Not through housal unit flipping, or stock appreciation, or winnings at Red Hawk Casino (kreee-ee-ahhh), but through slow steady paydown. The slow accumulation of wealth is really a foreign concept to everyone around me. All I ever hear is "I'll be working 'till I'm dead," or "I'll let insurance pay it off when I die," or some other variation of that theme.

Slow steady paydown. How novel!

Lost in the euphoria of all that housal unit appreciation of the last decade, when people were making money off leveraged money (which, of course, is an unproductive effort in itself), is that there is still an underlying debt to be repaid. My neighbors conveniently forgot that the borrowed money has to be paid back.

Now, aside from all those souls who smartly drove away from their underwater mortgages we have legions of others who have become the new "debt serfs;" people who will for decades continue to pay on these mortgages. In fact, there are more people who continue to pay on these inflated mortgages than those who defaulted. Here we have a banking industry that has not created any new value or any new wealth and who will continue to live off these future mortgage payments for decades to come.

In some sense, all this financial churn, all these banking fees, all these insurance adjustments, they all mirror the wealth without effort mentality of the general population. Some four years after the crash and we still cling to these fantasies.

Take The Lane

Over 14,000 miles of commuting by bicycle and not once have I had any interaction with the Sacramento Police Department, the Elk Grove PD, Sacramento County Sheriff, or the California Highway Patrol.

Until this morning.

According to the DMV, if I am traveling straight through an intersection, I have a right to use the through traffic lane rather than ride next to the curb and block traffic making right hand turns. I do this every morning at the northbound intersection of Martin Luther King Jr. Blvd. and Fruitridge.

I passed the parked CHP officer about a hundred feet before the intersection and I took the right hand lane, staying in the left hand side. He pulls up on my right and tells me "you can't ride down the middle of the road."

The fuck I can't, I thought. I've got every right to take the lane under these conditions. And suppose I was intending on turning left on Fruitridge...I can't cross the middle of the road to get into the left hand turn lane, either?

I was immediately defensive. I told him "I have every right, sir." He nodded "no, you don't." I said, "yes I do -- I have the right to take the lane at every intersection, and have the responsibility to allow cars behind me to turn right." By then, the interchange had turned green. I waved him off, he turned right, and I went straight ahead -- end of discussion.


This bugged me all day long. Fourteen years of bicycle commuting and the first and only interaction with traffic law enforcement demonstrated their ignorance of the laws they are supposed to enforce. Not only do I have to content with drivers who wouldn't give me the right-of-way even if they knew the law (and most don't), I have to contend with highway patrolmen who also don't know the law.

Commuting by bicycle, I now surmise, is a lose-lose proposition. Not only do I not save a dime doing it (as I've pointed out here on my blog), law enforcement doesn't know the law, wouldn't or couldn't back me up in an accident, and I risk massive injury or death every time I mount the bike. I got rolled up on by four black guys in a Caprice this afternoon riding home, which might someday lead to an unpleasant outcome. I prolly don't get a real cardiovascular workout, either, as a commuter. Real bicyclists would say "never get on the wheel of a commuter."

This officer -- clearly younger than me -- certainly hasn't ridden a bike since grade school. He's as autocentric as every other Californian; completely dependent on automobiles and has no idea the laws pertaining to the use of the roadway by anything other than cars. Lives in the Sacramento 'burbs, two miles from anything other than other housal units, drives his car to work to drive another car to ticket/assist other cars.

I certainly get discouraged. I suppose I monologue simply to vent, because that's about all I can do...but it works! I'm a little more balanced than I was a half hour ago...

Relax And Enjoy It

I have long maintained that our American population doesn't give a shit about our wars. We were never taxed to fund them. We were never conscripted to wage them. We were never attacked by the parties against whom we engaged. Two trillion dollars on two wars? Christ, that's but a sliver of the overall economic calamity that's upon us; we borrow and spend that much in ten months' time these days.

We failed to sacrifice anything for these wars. With heavy hearts back in 2003, we climbed into our SUVs and drove to the mall to do a little extra shopping. That was our sacrifice. Remember that? Go buy a new car, we were told. From the highest office in the land, no less.

Now, today, there's this fake outcry against invasive patdowns at the airport. It's fake. It's protesting this fabricated notion that "they're taking away our freedoms." Bullshit. What it really is, is our nation's unwillingness to sacrifice anything for the engagement of our wars. If we indeed are fighting wars against terror, and if indeed we really gave a damn about 'em we'd accept these efforts. Instead, we cry foul over a hand across our crotch.

I rightfully bitched in June of '09 about having my little Alien bicycle toolkit taken in Amsterdam; rightfully, because the TSA expressly permits these on carry on luggage but that screener demanded I surrender it as he was ignorant of the security measures he was supposedly enforcing.

Now we have little girls "groped" and men's junk and women's breasts "fondled." What an outrage, eh? What a violation of our civil liberties! Our privacy is besmirched! Is there no God anymore? Why, oh why do we have to sacrifice at all? Aren't we the chosen ones? Aren't we privileged? Doesn't our liberty mean anything anymore? Does it not still shine as a beacon in the night across the oceans to all those who hate us?

Again, another interesting cultural fricassee is upon us, and I will enjoy hearing about how the 0.002% of those getting screened complain about a grope, about spilled shit from a colostomy bag, or whatever, and how we will all be made to "fear" the security checkpoints via well crafted media spotlights on a coupla people who cry feigned havoc over scanned images and patdowns.

If being groped by the TSA is inevitable, relax and enjoy it. You are finally being made to sacrifice for War, American Style.

The Forest For The Trees

The Sacramento Fire Department responds to over 3,600 traffic accidents each year. That the city is under a budget crunch there is pending legislation in the city council chambers to impose a crash tax, where those at fault are charged for services.

I'm not terribly concerned either way regarding how to pay for this, whether through taxation or direct levies. What bugs me is how the city/fire department tacitly create streets that encourage excessive speed, leading to accidents, leading to the fire department response. If they didn't require such big fire trucks, forcing every residential street to take on the geometry of the Texas Motor Speedway, there'd be far fewer accidents that require their services. That is, I maintain that our street designs call for accidents. They call for firemen not to fight fires, but to rescue dumbass drivers who can't stay in their lanes, can't keep under the posted speed limits, and who feel safe driving 62mph down a 55' wide collector road yet still manage to plow into parked cars and power poles.

That's over 10 calls every day, just in Sacramento. Why are they even called firefighters? They are traffic accident handlers who just happen to douse the occasional fire.

It's the fire department that bitches the loudest over traffic calming devices. You can understand why. Without these 10 calls each day their usefulness to the city becomes arguably questionable. Of course, their argument is always framed around response times to fires, and what city council member would risk the political fallout if one crippled woman gets third degree burns that could have been prevented had the department's response time not been worsened by speed lumps? It would indeed be ironic if that same woman had become crippled due to a previous auto accident, wouldn't it?

I find this amusing, because we again fail to see the forest for the trees. These trees -- the trees on streets are removed due to their presence as "fixed traffic hazards," when in reality the more "friction" a street has, the slower drivers drive. Trees are friction. So are parallel cars, narrower streets, lane markings, chicanes, and a host of other devices and methods that lend to safer streets, yet the fire deparment can't navigate their damn trucks through these so they are outlawed. The most dangerous streets are those that feel safer to drivers...

Foie Gras

According to our city council, the $500,000 the City of Elk Grove's city council just approved for economic development for the Ford dealership in our beautiful Automall "isn't a gift." No. This half million is to be used to cover initial promotion costs and ongoing advertising costs.

Sounds like a gift to me.

The city, of course, is further pinning its economic future on increasing car sales. By doing so, obviously we stand to benefit from tax revenue, revenue that supposedly will exceed the half million gift um, er...incentive.

Of course, the best way the city council can incentivize Elk Grovians to buy cars is to forcefeed extreme auto dependency into every goddamn planning approval. Make sure that if a resident wants to buy a pack of gum she'll be forced into a 6-mile round trip to the consumption depot. Ensure streets are built to discourage pedestrianism, that they only provide for the efficient delivery of vehicular traffic. Ensure that if anyone moves to Elk Grove there are no options made available to provide for basic services or for doing anything else unless sheltered under the carapace of a new 2011 Ford Escape from the Automall.

All the while Elk Grovians don't ever question this arrangement. No, a car is...just...necessary. Gotta have one. Actually, we gotta have multiple cars per housal unit. As I look at each housal unit on my street, my own unit has three. Next to me -- three. Next to them -- three. Next to them -- two. Across the street -- three. Next to them -- four, if you include the two motorcycles. Next to them -- foreclosed...but they drove away from that unit in their two cars.

Nothing like a little collusion between big developers and their deep pockets keeping the same city council incumbents in office, along with big automall financiers and their deep pockets keeping the same city council incumbents in office, along with the guaranteed expectation that every so often a half million dollars in borrowed monies flows to "stimulate" their endeavors.

What I really like about this incentive is how, early next year when the Ford dealership returns (which vacated two years ago), they will use a portion of this incentive money to blow on a grand re-opening ceremony complete with "NASCAR teams and monster trucks." Just what this city needs -- two autocentric spectator sports promoting the purchasing of vehicles that our residents will try to emulate when they race each other up Franklin Blvd. at 1AM or try to beat the lights at the intersections they know don't yet have cameras.

And we accept this. You know, some French farmers actually claim that their geese "look forward" to the mechanical contraption used to force feed them to fatten their livers. When their only source of food is such a device, well, I suppose they'd really have no choice but to look forward to it. We don't realize we're getting force fed continued auto dependent horseshit, and yet we cheerfully look forward to our darling children in the Franklin High School marching band at the opening ceremony, we cheerfully throw a fucking parade for a dealer that failed once and that may fail a second (or third) time, we cheerfully accept blowing a half million dollars into developing a few dozen jobs selling shit, and we cheerfully accept even further dependency on retail sales to provide our [only viable source of] tax revenues.

This incentives announcement comes not two weeks after an election where we chose the same developer/automall funded councilmemebers. No surprise there, eh?

Binary Systems

I am already thinking about my predictions for 2011. How will they differ from my predictions from 2010?

For the most part, I would say that my predictions for this year held true, with the exception of the notion of crisis. We are a nation geared only towards binary objectives -- Democrats & Republicans, fear & calm, liberal & conservative, and crisis & complacency. I expected that this year would yield to crisis...but most would likely agree that this wasn't the case.

Perhaps because we haven't yet extinguished ad infinitum unemployment benefits, that they are continuing in perpetuity. Perhaps because we've blown yet another trillion dollars of tomorrow's efforts on today. Perhaps. Granted, my hope for crisis as a condition is well documented here on my monologues, and indeed it's not only just a hope, but a wish, really. A wish that a crisis condition would move this nation off its current trajectory.

Bear in mind that the profligate spending spree we enjoyed over the last decade or two is only perpetuated by the trillions currently being borrowed by the Federal government; that is, the same hallucinated increase in notional wealth we "enjoyed" between 1996 and 2006 is being propped up by trillions trillions! of future earnings. Overall I would say we haven't done a damn thing different.

As a result, 2010 was a year of overall complacency...marking time until the next crisis.

We know that wages between 1996 and 2006 didn't appreciably appreciate...yet our standard of living sure as shit did. Today we live in much larger housal units, drive more expensive vehicular units on more elaborate roadways, own multiple big screen viewing units, and carry about myriad units of electronica -- smart phones, boysenberries, iPads, in-dash nav systems, and DVRs. We get MRIs and CAT scans and X-rays for all manner of boo-boos, prescription drugs for whatever ails you, all while hiding absorbing the perpetual double digit cost increases with government expenditures funded by future taxpayers. Our standard rose, in part due to the borrowing of money we didn't have.

Ask anyone you know, including yourself: do you expect your children to carry a similar or better standard of living that you do today?

Why is it that not a single person I've asked answered in the affirmative? Why are we all such pessimists?

Let me ponder what this means:

• Tomorrow, people will be fatter and more diseased than today.
• The cost of preventative health services will become prohibitive...where insurance companies deny an increasing number of measures.
• Housal unit buyers will only be able to afford 3,245 square feet instead of 3,360.
• Tomorrow's children will (gasp!) have to choose between an iPod or a cellularized telephone...not both.
• Tomorrow's commuters won't be able to afford the 68 mile round trip, instead being forced into sub-55 mile commutes.
• Children might have to walk to school while both parents, if they even have both parents, are forced to work.
• A ticket to Mount Davis at a Raider's game will cost $355. Before service fees.
• Gridlocked traffic will become the norm as society has less money to build new freeways.
• We'll have to choose between a land line or a cell phone...not both.
• Apps for the iPhone will cost money.

All while Medicare taxes might increase, social security might go insolvent, even more jobs might be outsourced, water might become scare, imported oil might reach a limit, electricity might become intermittent, climate disruption might reveal itself negatively...

But, hey, those are crises that may be at hand tomorrow, so let's just enjoy the calm of our complacencies of today while we can get it.

Nineteen

Admittedly I was on the fence regarding the decriminalization of weed here in our Golden State, as I know how debilitating it can be. Apparently the majority of the state agrees, although there were myriad reasons why each chose to defeat the proposition. Some for religious reasons; somewhere God told them not to toke. Others for enforcement reasons; their jobs depend on continued decriminalization. Many for personal reasons: their stoner brother is a slug and they simply don't want to offer tacit support of this lifestyle. Fair enough. This decision won't change the habits of anyone who partakes; it'll be as omnipresent as before.

I openly address my own medicinal grow (yep...I'm licensed) with my co-workers, and it's clear there's a rift between them, not unlike the state or the nation in general. Almost a 50/50 split within my little group...not unlike the state or the nation in general. It demonstrates just another facet of the polarization we maintain as a nation -- in all areas.

I suppose such polarization has always existed; truthfully, I haven't bothered to go back in time to see if the same degree of polarization existed in 1932 or in 1962. But I suspect that this is simply a consequence of a two-party system, and that it's always been there, and that it's likely not any worse than today. I mean, I argue that there aren't any more pedophiles offering candy to get in the van today than there were in 1976; but popular consensus is that there are. That there must be.

I voted along third party lines during the last election; one, because I believe in the platforms of a few of the minor parties, but two, because I would like to see a viable third or fourth party emerge in my lifetime to wrest this polarization away. I'd like to see a swing set of elected officials, not just the two who's purpose isn't just to follow their own party line but to oppose the other.

Of course this will never happen. This is why I blog, to broadcast a set of opinions that will never see the light of day, but that represent the things that are important to me nonetheless. That we are moving to a general election where only the two top candidates are available from the primary election demonstrates the stranglehold the two major parties have on the process and why my little third party voting will never go anywhere...but I'll vote that way anyway, for as long as I can. If I can't vote third party, I will simply not vote.

In any event, I gain simply from the satisfaction that so much money is spent trying to get my non-vote. Contrast this with prop 19, whose supporters really didn't have to throw out much money to get the 45% that it did garner. In different times, times that aren't all that far off, the legalization of marijuana will come to pass.

The Growing Black Hole

I monologued a few days back about how I'm primed for a pay cut next year. An effective pay cut due to the 20.3% biennial increase in medical insurance premiums my utility faces.

Of course, this increase is on top of near double digit annual increases over the past several years. As Obama's long term health care plan hasn't yet arrived, it'd be rather mendacious to assume this should be held liable for these past increases. Yet remarkably, we now have a Republican controlled House that's primed to roll back this health care initiative before it even starts -- back to our existing 18% of GDP (and growing) black hole, into which we're squandering a great deal of public monies while our population continues its epidemic rise in obesity and diabetes.

Pardon me if my lack of enthusiasm doesn't come across very well.

You might think that our consumer price index would reflect this 10% year-over-year increase in my health care premium...but apparently it must only be affecting me. Nope -- CPI shows only a 1.1% total increase over the last 12 months. Nope -- prices aren't rising.

Nope -- my utility didn't just raise electricity rates 13% over the past 18 months. I didn't just get another 8% increase in my garbage and sewer bill. And neither did my cost of health care escalate...not according to those official economic barometers.

I enjoy thinking about these economic indicators, and thinking about how totally fucking useless they are to the bottom 75% of us. It is an interesting dynamic. To those employed the unemployment number is but a meaningless empty statistic. It's also a meaningless empty statistic the those unemployed.

But what isn't meaningless is that I'm set to lose another fifty cents an hour to a health care system that won't reflect this gain into better managed care. We will have more medically uninsured in this nation, not less, by 2012...a prediction I made last year here on my monologues. What do you suppose the Republican controlled House will do about that?

Absolutely nothing. They've no less indicated that. The continuation of channeling trillions into the same hospital and pharma enterprises is what's in store. The continuation of double digit premium increases for the foreseeable future is what's in store. It's not so bad for people like me, though, who can absorb this little $0.50/hour wage decrease and the 13% rate increase for electricity to pay for the employer's share...and for someone who will likely continue to keep his health insurance.

I should just shut up now. No sense in spending blog energy on the uninsured or those ad infinitum double digit premium increases. You, the electricity ratepayer, will absorb most of that. I'm so glad you are a captive consumer; if you choose to consume less electricty to reduce your own exposure to these rate increases, our utility will have no choice but to raise rates even more. I should just shut up now.

Economic Outliers

The new Target at 65th and Hwy 50 is bustling. Lots of traffic at that intersection, as predicted, and [presumably] less traffic at all the other retailers in a 7,500' radius. I would expect, say, that the new WingStop across the street has lost business as shoppers drive into Target and buy 50# bags of chicken wings themselves...along with a 2# brick of butter and a half-gallon of Frank's Hot Sauce. Nothing like buying in bulk for your family of three; cheapness reigns supreme, above all else, in these tough economic times.

Stores like this have been calling in more clerks and opening a few more checkout lanes on the midnight shift on the first few hours of the first day of the month...for obvious reasons.

I really don't want to sit here in my little cave and bash the tens of millions of Americans using electronic benefit transfer systems. I know and enjoy the company of many who use this program...but I've already blogged about their lifestyles. I regularly see whole South Sacramento neighborhoods that are dependent on EBT.

Really, it has nothing to do with these people. They are economic outliers, relative to the value the food subsidy program has towards the Archer Daniel Midland's and the RJR-Nabisco's and the WalMart's. They are the real beneficiaries -- they grow and process and package and transport and sell the notional foodstuffs consumed by the growing number of food subsidy recipients.

They would have been beneficiaries anyway, if the economy was better, as these same items are consumed in good times and bad. The only difference is who is paying for them. My cousin in South Sacramento, this isn't a gift -- that he was able to buy a few food items for his dysfunctional living arrangement is just a bone thrown by those who don't benefit by starving people, and who clearly would suffer if the starving masses ever went marching.

Come on -- public monies flowing to the same multi-national corporations? They'd have a hard time engineering this shit in a real economy.

Lower Prices, Always

Gotta love that WalMart slogan. They do indeed carry the lowest prices, don't they? Here in Elk Grove we've developed a city entirely dependent on the sales taxes generated by these few mass merchants -- the Auto Mall, the WalMarts and the Targets.

The difference with Elk Grove, compared to other cities, is that WalMart didn't have the opportunity to bulldoze the entire city's network of suppliers, distributors, and local businesses that created a diverse, employment-rich local economy. No, we built a city that never had a local economy to begin with and overlaid it with low-wage, low-skilled sales associates at big box stores.

We re-elected Gary Davis to the city council...a guy who wants to bring in 50,000 $55,000/year jobs to the city. The problem is, the only local jobs Elk Grovians have available are working at WalMart or service jobs in support of those working at WalMart. Not a single one able to reach that target wage. The idea that you would pay a little more to keep your neighbor employed is heresy. Not a single Elk Grovian is employed to manufacture any of the products sold in the WalMart.

This is a slow train wreck in my opinion. There is no opportunity anymore for quality made items, not when we demand the lowest prices, always. Either a big box supplier provides volume at a specified price point or the supplier's contract is yanked and they implode, because where else are they going to market their products if not at the WalMart? Product diversity is stymied; we get two suppliers of baby food and only two, and if you don't like it, well, fuck you. A thousand other Elk Grovian mothers will keep buying this low cost shit even if you don't...because it's low cost. They accept the mono-culture of their cheap purchases because they are cheap, and we're addicted to the consumption of large volumes.

50,000 AMI jobs? Gary Davis doesn't have a chance, not with the framework of a spraw-based strip-retail auto-dependent "city" he and his earlier cast of city council members created over the past decade. But hey, he was only enabling us to get what we wanted: Lower prices. Always.

The Illusion Of Hope

On my little street here in Elk Grove we still carry two foreclosed housal units. Oscar and Beth smartly drove away from their unit two years ago after purchasing another unit elsewhere. Another foreclosed unit lies eight units down. Across the street, Mark and Melanie have not yet done so and are [presumably] substantially underwater, but the unit is being rented. Perhaps a short sale will occur in the near future to the couple who's been there for a while; that would be good for everyone; they are good neighbors, although I rarely see them.

However, I don't think that foreclosures are as bad to our local economy as are all the other owers (sic) faithfully making payments on their underwater units.

By doing so, they are keeping the banks bottom lines up, they are not able to take advantage of record-low interest rates, and the money they are blowing on a losing economic proposition is not recycled back into the local economy -- the Asian foot massage parlors, the cigarette stores, the electronica emporiums and the temporary Halloween stores that define the Elk Grovian services and retail marketplace.

There are 15,234,552 borrowers underwater in our nation. Of those, 7,787,338 are underwater by 25% or more. Of those, 4,008,451 are underwater by 50% or more, with an average negative equity of $107,000.

Several roof tiles across the street have blown off in recent months. If you're $107,000 upside down on that mortgage, where's the incentive to fix or replace them? There isn't much of one, so the local roofer is deprived of that opportunity, even though in the long run the damage caused by leaking water will be more expensive for someone to address. The owners are borrowing against the future, like everything else we've done in the U.S. for the past thirty years.

The dollars spent on the underwater portion only supports the banking "industry." Gone are those dollars used to upgrade kitchens, to spend at the pool hall, to smoke the products of the cannibis clubs. All these owners will continue making payments and hope for the best -- hope for a rebound in the economy, hope that their unit will someday return to its 2006 value.

A hope that I regard as an illusion.

Health Bubble

The economy produced 151,000 jobs last month...besting virtually every month over the last two years, as these represent private hiring, not part-time census workers.

My son will be graduating high school in 2015. As he does, he'll be vying for one of those 125,000 jobs that will need to be created each month just to absorb new entrants. That is -- we need 125,000 each month just to hold steady. Last month's gains, while substantial to be sure, does nothing to lower the unemployment rate...it just keeps it steady. And it did.

My concern, oft discussed here on my monologues, is that these are likely fake jobs. No, they are not fake to the guy landing it, far from it. He needs it and is happy to get it. But they are destructive relative to the long term health of our society in my opinion.

Service jobs are exactly that -- services that assist production. They are inherently non-productive, and cannot last in an unproductive economy.

Of those 151,000, the BLS report offers that +24,000 were in food services and drinking places.
Of those 151,000, +6,000 were auto dealership salesmen.
Of those 151,000, +5,000 were in electronic retail sales.
Of those 151,000, +35,000 were in temporary help services.
Of those 151,000, +24,000 were in health care services.

I'm not bashing these jobs; far from it. I simply think that they cannot be created in a non-productive vacuum without long term consequences.

Think -- for how many months going forward can our health care system absorb 24,000 jobs? Yes, there will be increased demand due to retiring baby boomers and diabetic children raised on fast foods, but at some point, some point, we are not going to be able to continue to absorb double digit health care increases ad infinitium.

I maintain, quite openly, how blessed I am to carry a job...but I do so having prepared years earlier. I saw this shit coming -- it was visible from a thousand miles away. I ensured I carried a job that can never be outsourced or lost during a recession -- domestic energy production. I didn't pin my economic future on flipping housal units or selling hot tubs, both of which made many people wealthier than I last decade, but are not needed today.

This year, my job's health insurance costs saw a 13.4% increase. For 2011, the premiums are set to rise 7.3%. My share of this increase rises another $50 per month, while wages will remain frozen. That is, next year I will see an effective $0.50 per hour pay cut. This money will flow into those +24,000 health care jobs created. I am hardly bitching about this. I'm an economic outlier who means little to the economy -- I'm not the one out buying new cars or clothes to support it. I live below my income and won't miss this fifty cents per hour. A thousand dollars less per year into savings, I suppose.

How long can our society absorb a 20% increase every two years? My guess is that every year going forward, I'll continue to see a $0.50 per hour pay cut (or more) to support the ballooning cost of health care, and we'll continue to see electricity rate increases to support the employer paid portion of this ballooning cost of health care.

When we cannot continue to support the exploding cost of health care, we're going to see the burst of the health care bubble we're creating -- the bubble creating the majority of jobs today.

Fait Accompli

Two teenage pedestrians were seriously injured two weeks ago when hit by a vehicle on the same stretch of road I ride the bike to work.

The uncle of one of the victims posted a comment on that link, indicating that the kids were in the marked crosswalk; the driver was going "too fast for the conditions." Read: he was speeding. No surprise there -- Broadway is full of speeding drivers in the morning. Come to think of it, it's full of speeding drivers at noontime. And it's full of speeders in the evening, too.

I am presuming the uncle knows the details of the SAC PD police report because I called the PD and they would not release it to me, as I was not involved in the incident. I tried to get the police report from the Elk Grove PD the other day regarding the man killed on Sheldon last month, but again, it's not releasable. Therefore I have to speculate. And if the uncle's account is true, then I wasn't too far off the mark regarding the cause of this accident.

If sun-in-the-eyes was at issue, it's always a matter of speed: slow the fuck down. If kids are present at that intersection the speed limit is 25mph. I hardly ever, ever! see anyone drive that speed. Slow the fuck down.

Consider this: the girls, unfortunately, will probably have to be driven to school for a while...when they are healthy enough to return to school. This will only increase the brutal traffic at that intersection, creating something like a fait accompli: More cars and parents will demand their children be driven for safety, creating more cars, making it a dead-zone for anything but vehicles.


This driver: if the victim's uncle is fair in reporting and his comments regarding the accident are indeed factual and not just speculation or wishful thinking (sorry: this is an all too common human trait), then what does this say about the way we drive? A guy in slacks and a collared shirt; he could work next to me in my office. Probably not a stoner. Probably not drunk on his way into work. Quite likely someone any of us would befriend. But behind the wheel, like 80% of the rest of us, he becomes an asshole. Doesn't give a shit about other users of the road. Doesn't signal. Speeds. Likely carries multiple pieces of electronica and operates them while driving, because fielding that phone call now is always so fucking important. This is the way most of us drive, and I don't care if I'm totally wrong about this one chap -- most of us drive this way.

So if a [presumably] well-to-do and responsible guy can level a few teenagers with his vehicle because of excess speed, what do you suppose those who maintain no personal responsibility are capable of?

Foreclosure Of A Dream

From a Huffington Post slide show of the foreclosure capital of the universe, Las Vegas, comes this slide of what represents (to me,anyway) not the worst of the housing meltdown, but the worst of the housing bubble:


This is a caricature of a home, a housal unit that opens its maw, swallows the vehicular entity and its occupant and closes up...awaiting the next victim. I imagine that the owner painted a upward curving smiley face on the garage door, maybe with a missing tooth too. That would go well with the his-and-her Lexus', adornments to the garage and the housal unit as a whole.

I suspect that this unit would have fetched $363,998 in its prime. A shame that such an architectural marvel is allowed to sit vacant for $121,000. Can you imagine the heat in that upstairs south-facing bedroom without working air conditioning?

To me, this represents the foreclosure of the American dream -- we've foreclosed on nice places to live, on houses built with some degree of charm years ago, now trumped by stucco and foam accouterments and a big blank garage door consuming 2/3rds of the unit facade. Places we used to live in -- medium density, walkable, tree lined -- have held their value during this supposed economic slowdown, but have long since fallen out of favor to shit like this. This is the America we wanted; charmless, soulless, empty, but above all, cheap...and we got it.

Scouts

The maker of Girl Scout uniforms has been doing so since 1968 in a small factory in New Jersey. Today the Girl Scouts find it economically prudent to solicit bids for the required gear, and likely, the cheapest bids will come from Guatemala or China. Just my guess.

Granted, I know nothing about this organization, but in my mind's eye I see it as an all American affair; I don't mentally envision the Moroccan Girl Scouts or Burmese troops selling cookies outside their bazaars or shopping malls, or whatever they call their own versions of their consumption centers. But there might be some foreign presence for all I know.

I think it interesting that an 11-year old Elk Grovian girl might someday soon climb into her mom's chariot, their Nissan Murano, get shuttled to her girl scout rally across town to meet up with a dozen others, all wearing apparel manufactured by nameless, faceless 11-year old Chinese girls 8,342 miles distant. The $29,454 cost of the Murano? Just another necessary accessory that comes with suburban living; clearly, a non-discretionary expense these days. The cost of a $6.50 sash for her little scout? Whoa, way too fucking much. What are they trying to do, bankrupt working families? Outsource that labor! Drop the price to a more reasonable $3.97.

And so we will. And we'll lose another small piece of American manufacturing, and the textile mills will produce a few bolts fewer than before, and the carton company will produce a few fewer shipping boxes than before, and on it goes. But while the parents lose their jobs and will find other, lower paying jobs in and around New Jersey, at least they'll be able to send their own little girls to scout meetings, because now they can afford the sashes and the vests...and the buttons and the pins and the badges for that matter.

Socialize The Losses

At every opportunity I listen to Tom Sullivan on KFBK in the afternoons. I listen to his ideas on fiscal conservatism. That's a good label for my own personal financial approach to things. Nonetheless I'm quite left-wing as it applies to social issues and this usually trumps voting for fiscally conservative candidates. The God, Guns, NASCAR and CORPS attachment to fiscal conservatism makes me want to puke in my soup.

I enjoy the hypocrisy of a well-known wealthy fiscal conservative enjoying the fringe benefits of a public bank bailout. Had the government not blown a trillion to prop up housal unit values he'd be short-selling it at an even lower price than the artificial prices that units are commanding.

I personally believe that prices should drop even more to return to historical norms...but think of the damage another 15% would cause the banks...would cause the homeowers...would cause to the ancillary services of refinancing, HELOCing, and carpet installers...would cause to Fannie and Freddie where 96% of all new mortgages end up. Perhaps with another 15% drop would come 15 years of stagnant Elk Grovian low-density sprawl. Maybe by then the city council members would come to realize that this type of growth is destructive. Maybe not. But for the next 15 years, the rest of us can live without the threat of groan! more development! More traffic!

Things are looking up.

The Curse Of Woe

I wanted to clarify my understanding of why a Chinese manufactured product is cheaper than American made, but I couldn't make sense of it. Seems to me that the evisceration of U.S. manufacturing is more of an excuse (a choice) rather than anything else.

Say you have a $500 item produced in China where the labor to build it represents 5% of the total cost. Really, most of the expense in such a big item is not in labor at all...it's in the supply chains, the parts, the pieces. If they get paid $500 a month to build stuff while their American counterparts would have been paid $2500 a month, the 5% cost of labor would be $25 in China and 5x that in the U.S., or $125. The wage differential is a hundred bucks.

But the story doesn't end here. Think of these factors:

Your 401(k) is doing as well as it has because corporate profits surged over the past twenty years by sending jobs overseas. Fiorina's Hewlett Packard saw immense gains. So, let's take twenty bucks off that wage differential for not having moved offshore.

A $500 item made in China is likely a big, hulking thing. Not likely a small, intricate electronic device. So take twenty bucks off that wage differential for not having to ship it 8,000 miles on a container ship.

China uses predominantly coal fired electricity to power their manufacturing sectors. There is a social cost that will arise from this use, along with the expectation that they will eventually spend trillions to develop the same levels of OSHA-like regulations, HAZMAT controls, and other regulations worthy of an advanced manufacturing sector. Take off another 20 bucks for the current and future costs of pollution and worker safety.

Lastly, they are very likely vastly less efficient in that energy use than the U.S. Take off another $5 bucks.

Now the real difference is $35...on a $500 item that's less than 10%. Really, if we were to consider the American retail markup of these things (to account for the cost of the escalators and air conditioning at the Gallerias where we drive to purchase these things) we could narrow that difference even further. There's a lot involved in the selling of shit to Americans; a lot of retail fat that can be lopped off.

This is an amateurish estimate of things, I fully admit. But really, would you expect that American labor lower wages to Chinese levels, or work in cost-effective stripped conditions like Mexican factories?

Well, the former is where we are headed. We won't get lower wages in American manufacturing, we will instead off those manufacturing jobs and replace them with lower paying strip retail associates and other service jobs. We'll do so, because in my America the notion of manufacturing work is not a part of our identity anymore.

Not when there is better money to be made in the FIRE (finance, insurance and real-estate) sectors of our economy, where the idea that CEOs are worth millions instead of hundreds of thousands, where anyone can flip real-estate and never get their fingernails dirty. Our culture has shifted, unlike in other advanced manufacturing nations like Japan or Germany where factory labor is an important part of their national identity.

Our culture has shifted towards the FIRE. These jobs don't produce a fucking thing yet somehow out comes a pile of money -- JP Morgan builds a collateralized debt obligation, AIG insures it, the government develops policy to facilitate it, fund managers hedge it, yet nothing has increased in value. All those mortgage holders in that CDO didn't get any improvement on their housal units, didn't get shit for all this financial speculation except for a much deeper recession than what would have otherwise occurred.

I forecast the continuation of woe. Not just because I want it to happen (I do), but because I don't think this nation can move away from its culture of consumption to that of production...something that would reverse this decades long slide of shuttered rust belt jobs. Instead I see a culture, as I've mentioned dozens of times on my blog, bent on entitlement -- on getting something for nothing. Flipping a housal unit was the epitome of this culture and once these values are established it's very likely impossible to reverse.

I paint a bleak future for this nation, but truthfully I want to see it happen so that we may emerge from the other side a better people that what we've become. I want to see a nation that respects its bicyclists, that builds beautiful places to live, that values their crafts, that respects their environments.

Horrors!

Couldn't let the burning of one the largest suburban consumption depots in our region go unreported here on the Franklin Monologues, now could I?

Horrors!

"We'll get through this difficult time" was overheard during local news reports this evening, like we just lost a grandchild or something. The twin blows of a crippling, disfiguring economy and a big fire in a mall; is there no God?

A Foreign Affair

I wonder what it would have been like to be an engineer in Westinghouse's Power Equipment Division, circa 1963, in Pittsburgh, designing transformers.

So I'm a middle-aged engineer in 1963. I'd think that as an electrical engineer I'd most certainly be the only wage-earner in the family. Westinghouse hadn't yet begun its drawdown into industrial financial services...no, its revenue still came from the manufacturing of stuff...actually building things instead of financing them. I've got a wife and kids and a dog and most importantly, a reliable car to commute to my new surburban housal unit in Wilkinsburg. I help design a 200MVA transformer bank for shipment to Sacramento. It's installed the following year. My life is good, yes. Sure, I spend most of my weekends boiling glass syringes to sterilize them for re-use the next week as an insulin dependent diabetic, but overall, life is good, yes.

Cut to today, where I'm a middle-aged engineer in 2010. Today while I'd like to wonder about what engineering must have been like in 1963, instead I sit in my cube and receive reports how a 69kV feeder crossarm broke, causing a fault, and when our dispatchers attempt to reclose a few moments later to restore the 8,000-odd customers that were momentarily outaged, the Westinghouse transformer installed in 1964, some 46 years earlier, decides its days are over. Major internal core damage occurs as the sudden pressure and differential relays operate; an internal B-phase fault ends its half-century run.

Today I sit in my cube and think of its replacement. We have an opportunity to get a new laminated core built for this bank...but it will have to be sent overseas to get that done. We have an opportunity to buy a new replacement bank...but it will most certainly come from South Korea or China. Transformer bank engineering and construction is now, nearly universally, a foreign affair.

A foreign affair, because our "new economy" allowed GM to become a financial services company that happens to make cars...as they discovered that the real money wasn't in making shit -- it was providing financial services to others who make it and to the buyers of it. Someone built my housal unit, I'm paying a mortgage to GMAC for it, and GM earns a small sum for handing the transaction. Sit in the middle and collect a percentage managing the financial affairs of other producers and consumers. Increasingly, however, those producers were foreign.

If you followed the demise of Westinghouse you'll know how the transmission services division of this company also delved into "industrial services financing" before closing the East Pittsburgh plant and being swallowed up by ABB in 1989. A financing company that also happened to build power transformers. Interesting parallel. Also interesting is how now they do neither.

I suppose Hyundai Heavy Industries in South Korea will follow the same path. Today they are one of the few producers of bulk power transformers, but if things play out there as they've done here, they'll soon tire of just making stuff and will really tire of watching those Melican financial services companies skim all those profits and soon they'll say "fuck it" and get into that action for themselves. Hyundai Heavy Credit Corporation will become one of the "heavy hitters" in the global industrial financial marketplace...pun intended. Won't take them very long to realize how much money is to be made providing both the manufacturing and the financial servicing of their products...cutting out all those American middlemen.

And what will happen to all those American financiers of 2010, whose fathers were building transformers in Pittsburgh in 1963? What will they do? What will their children do, twenty seven years from now, when manufacturing isn't a viable career and when financing is no longer a viable career?

Crystal Castles

For someone all power, all perfect, all wise and all knowing, you'd perhaps think God could balance a checkbook, too. Apparently he can't, or at least many of his followers can't, not with the bankruptcy of the Crystal Cathedral announced today, some $55,262,308 in debt.

How is it that this organization can be protected by bankruptcy law yet their 40-acre campus is [presumably] exempt from property taxation, huh?

And you thought bankers were bad? Here we have a ring that has an immediate ~xx% advantage against tax-paying enterprises and still it can't manage itself financially. One more? OK, how about all that right-wing fiscal-responsibility banter -- you think that mantra can be heard echoing off those crystal ceilings?

You talk about a racket...holy shit.

Phone Home

I am excited each Halloween, as more and more young adults come by with their nephews and nieces and tell me how I scared the hell out of them when they were kids. We've been a pretty active Halloween family for all my thirteen years here:

This is my usual spiderweb. I dispatched the spider yesterday. Today I'll get the toe-pincher coffin out with the pneumatic vampire. I wanted my crucified nun on an inverted cross receiving a hot-lead-douche for Halloween 2010, but the wife didn't approve. She muttered something about not wanting to look so evil to others. What a downer.

However -- what I remember most about Halloween as a kid wasn't my own experience, but rather, the Halloween scene in the 1982 movie ET. If you're my age, you were a kid the same age as the kid actors, and you got your first glimpse of a sanitized, wholesome California-style suburban "community." I wondered for many years why my own suburban neighborhood didn't look like that.

Fast forward fifteen years, I buy my Elk Grovian unit, and my own "community" looks much like that scene. Clean houses, kempt (sic) landscaping, good exterior paint, two new cars in every driveway. Halloween '97 comes, and it looks a lot like what I remember in that movie...only one thing is drastically different. There are no people.
We load up on the decorations, we offer a massive bowl of candy, yet people only trickle by. I take my own son out trick-or-treating and am amazed at how every other house is dark, every third house has a light on but no answer -- it has absolutely no resemblance to my own childhood experiences in Carmichael which was highly active, or to ET, where Hollywood inserts a community into that sterilized suburban housal unit pod.

Elk Grovian Halloweens suck. I blame it on a few factors:

• A much higher Asian American population than my Carmichael of the '70s and '80s. My observations are that they don't engage in this tradition;


• Within every third housal unit lurks a registered sex offender. We obviously didn't have that back then. Times have changed. It's much more dangerous out there these days;


• The neighborhood is bifurcated into multiple dead zones created by Frye Creek Boulevard Freeway. No parent in their right mind would allow their children to roam at night around all that brutally fast traffic...although they have no fucking concern when they themselves are behind the wheel;


• Neighbors don't depend on each other for anything anymore. Better to drive to the supermarket on November 1st, stock up on discounted candy, and have no fear that the neighbors spiked Billy's peanut butter cups with razor blades or dropped used syringes into Betti's bucket;


• The distances between housal units has grown to the point that little children have be dragged down the last street.

With a fair degree of sarcasm I still make my point because within each one of these bullets lies a kernel of truth.

The 4th of July, Halloween, Memorial Day parades -- these are things that define us as a culture, yet I am seeing that they are increasingly being trumped by private celebrations, by private ceremonies. Fewer and fewer of us engage in the few public events we have. Halloween in Elk Grove in 1976 was probably fantastic. Halloween in Elk Grove in 2009 is just a casualty of the dead, lifeless autoclaves we call subdivisonal living.

ET had to phone home. He boarded his spaceship presumably to return to a culture that probably respects the dignity of place, the value of community and shared experiences.

Nothing For Something

Every 26 seconds in this grand nation of ours another mortgage foreclosure occurs. Another investor hoping to earn 20% by flipping a unit...another South Sacramento family who thought that if they didn't get in, they'd never be able to get in.

All victims of the American culture of getting something for nothing.

And this culture is growing. Note that there are 21% more applications for social security disability these days than two years ago. Tell me...did something change here? Did we somehow return to icky, icky manufacturing jobs where people are becoming maimed in sheet metal presses? Are there still a few thousand people falling off roofs of those millions of new housal units being built? Did I misunderstand something here?

I didn't get a fax. Didn't get an e-mail. Didn't get a page. Didn't get tweeted or twatted or a facebook update. Didn't get a phone call. Didn't get a telegram. Didn't get a wire. Didn't get a voicemail. Didn't get a text. I didn't get the memo that somehow there are more people becoming disabled and becoming unable to work when there are 7 million fewer of us working.

Understand that once a person gets on social security disability, their odds of returning to the workforce is 1%. As soon as they are approved, they effectively retire.

Look. There are cases where, say, a 56 year old unemployed janitor simply cannot find work...where existing disabilities that he was able to work through keeps him marginalized while competing against 5 other janitors applying for that one job opening, and perhaps it's time to leave work behind. What can I say about his plight?

I don't quite know what to say. I blog from my little ivory tower here, well employed with little debt and a lot of savings. It would be rather shameless of me to assume that I wouldn't also apply under the same circumstances. I've been a juvenile diabetic for sixteen years now! Don't you think I could ride this fucking disease all the way to an early retirement? As Sarah would say, "You betcha!"

I do things somewhat different than you, I believe. I leave 20% tips instead of donating a whole lot to charity. I don't go to the doctor for every sniffle. I try to tread lighter. I don't think I would sue for a bona fide car-bicycle accident. I highly enjoy my craft. These are actions that determine my character, whatever that may be...and I think that I provide a positive net value to our culture as a consequence. I am not a believer in getting something for nothing.

This ethos is why casinos and gambling are now considered normal features of our American culture, why they are sprouting up on every supposed reservation and tribal unit. Sure, they've taken a hit during this slowdown like any other business modeled around wanton consumption, but stroll into the Tropicana at 2:45AM on any Thursday night and witness the volume of people 'at leisure,' gaming for 'fun.' There are still quite a few.

This ethos is why we had programming such as "Flip This House," where the supposed addition of a few gallons of paint and new toiletries were considered the equivalent of the craft of home building, where the return on the investment was measured in triple digit percentages, where any schmuck with a two-dollar paint brush can do the same level of work as any skilled craftsman.

This ethos is why "free" and "all you can eat" are the two most profitable phrases in American advertising.

This ethos is why we were willing to lend to anyone with a pulse, including some without a pulse, to keep our hallucinated FIRE economy running at any cost, while everyone knew that if they were the last holding the bag they were going to get really fucked.

This ethos is why it is political suicide to raise the use tax on car dependency, i.e., the gas tax, and why we mask it through the spending of trillions of general taxes to achieve the same result. If we don't pay for it at the pump we think we are getting it for nothing and we treat it as a free good. We use more of it as a consequence.

This ethos is why I've been told, to my face, that I'm an idiot for paying down my mortgage instead of investing it elsewhere, why I was an idiot for paying the capital gains on my rental sale instead of like-exchanging it for another 20% flipper.

This ethos is why, today, several million of us have received nothing for something, why several million of us have spent a fair portion of our one-time allotment of life energy and received nothing...why several million of us will spend a fair portion of tomorrow's life energy (something) and will still receive...nothing.