Tuesday, September 12, 2017

The current topic of the month in Washington is the budget and tax reform. Both subjects worthy of discussion. The Republican party wants to cut taxes which everyone in the country agrees is a good idea. After all who wouldn't like a tax cut? This will lead to decreased revenue for the government and government programs, just look at Kansas if you need proof. Very conservative members of the House and Senate have clamored for spending reductions to off set this reduced revenue. So far so good. Everyone believes in reducing spending on programs they don't participate in and will fight to death to protect programs that benefit them or their states personally.

Congress has centered the discussion on "entitlements" i.e. social programs. The one area that no one talks about is defense spending. Defense spending as currently constituted is little more than corporate welfare. We are spending enormous sums for Aircraft Carriers ($13 billion per), jet fighters that don't fly all that well (F-35), new littoral ship that can't keep salt water out of the engines (a problem that was solved when the Monitor and the Merrimack fought) and other expensive hardware. They say Generals and Admirals are always fighting the last war and in the case of the US budget it seems to be spot on. In today's world the way to have global impact is in cyber space. It seems that Russia, for the price of a couple of decent laptops and a really good internet connection, is having it's way with the western democracies. Recent events have shown that elections can be significantly impacted by social media and the Russians have focused their energies on that aspect. We continue to focus our spending on shiny new ships and planes while the largest threat we face is from hacking and misinformation. If you want to fund tax cuts, skip a few ships and tanks and by some Dell laptops and engage our geopolitical rivals in the arena of the future.

Monday, January 9, 2017

With the constant demand for content to fill the 24 hour news cycle, I wonder if anyone bothers to think about what they have written before they air it. Case in point: on either MSNBC or Bloomberg the other day, amid the wringing of hands about the decline of retail store sales among the big chains during the Christmas season, the crawling headline read "Amazon bucks the trend" I guess they were trying to indicate Amazon had a better season than guys like Macy's. Don't they get it yet, Amazon is the trend!

The headline of the article in the weekend WSJ read "Wells Revamps Pay After Scandal". In my naivete I thought "good" some of the board members and executives are finally going to held accountable for the fraud, misstated public reports, breach of fiduciary duty and probably a few thousand violations of the banking laws. What planet do I live on? The new pay scale was for low level employees at the branches. Why are the directors still in place, doesn't there have to be some accountability at the board level? What about the concept of "known or should have known".  This is reminiscent of the mortgage crisis in 2008, where the only guy personally charged with any wrong doing was a mortgage-backed salesman for Goldman Sachs who worked in Paris. Are you kidding me?

Great article on the CBS web site concerning a study of the housing bubble and subsequent melt down in 2008 here.