Are We Really on the Brink of a Depression?

More and more the talk out of Washington is that the nation is on the verge of a second Great Depression. President Obama consistently uses the word crisis when describing our economy.

The numbers are the numbers when it comes to current economic conditions, and they certainly aren't good. But Depression? I think that's a stretch if you compare 2009 to 1929.

Most economists take the historical perspective that a depression starts when unemployment rises above 10% and stays there for several years, wrote Justin Lahart in the March 30 Wall Street Journal. But there are a number of factors that would make a modern-day depression different from the great one of 80 years ago:

• In 1929 20% of Americans were employed in farming. They were decimated by the drop in agricultural commodity prices, not to mention the Dust Bowl climatology of the 1930s. Today fewer than 2% of Americans make their livelihood on the farm, lessening any potential blow to the ag sector. In addition price supports, enacted during the Depression woudl cushion and rapid deflation on commodity prices.
• In 1929 Americans thrown out of work, or evicted from their apartments, homes or farms were pretty much on their own. Today we have entitlement programs that cushion blows like these. Food stamps, TANF, WIC, LIHEAP, and unemployment compensation are just some of the programs enacted 80 years ago that help bridge people through the rough times.
• In 1929 a family expected to spend a quarter of its income on food. No income, no food. Today Americans spend less than 10% of their family income putting food on the table. In fact, consumer food prices in the U.S. are among the lowest in the developed world. The nutritional blow from an economic crisis is not as severe now as it was 75 or 80 years ago.

It's more likely that to weather the economic storm today, Americans are reducing their spending, not so much on food for the table, but on discretionary items like restaurant meals, video consoles or lavish vacations. This creates a rippling economic effect, but that's a story for another post.

Just thought you might like to know.

Fishermen, Beware!

The organization known self-righteously as People for the Ethical Treatment of Animals, or PETA, has a campaign underway which North American sportsmen and commercial fishermen will ignore at their own peril. Here's the "catch," so to speak. PETA has a website called FishingHurts. If you click over to the site you'll see that PETA has re-christened the class of animals we know as fish into "Sea Kittens."

On the site you'll see the cutest little cartoon collection of creatures--little finned friends that look like extras from the set of "The Little Mermaid." PETA's purpose: to indoctrinate children at the youngest ages to think of fish the same way they think of the pets in their own household. To brainwash children as young as three into thinking that the concept of catching or eating fish is cannibalistic and sadistic.

PETA is very clear about their objective: "Would people think twice about ordering fish sticks if they were called sea kitten sticks? Would sea kitten soufflé be a hot seller at the local seafood restaurant? Does fillet o' sea kitten sound even remotely appetizing? Learn more about the new campaign to save fish by changing their name." (from http://www.fishinghurts.com/)

The goal is (extra points if you know where this is going) to have the federal government ban fishing. Here's is PETA's call to action for you: "Given the drastic situation for this country's sea kittens—who are often the victims of many major threats to their welfare and ways of life—it's high time that the U.S. Fish and Wildlife Service (FWS) stop allowing our little sea kitten friends to be tortured and killed. Who'd want to hurt a sea kitten anyway?!"

Besides sending a message on your behalf to the FWS, you can read sea-kitten stories, share your stories with a friend, create your own sea-kitten, and buy cool sea-kitten logo wear for all the world to see how ethically superior to them you are.

Look, I think PETA adherents are self-righteous, delusional fringe players in the national debate about resource conservation. I don't much care when they splash blood on a Hollywood actress wearing a fur coat, or post videos to You Tube featuring naked young women protesting for animal rights. But this sea-kitten scam goes to far. It affects the livelihood of those working in the sport fishing industry--both fresh and salt water--as well as the millions of commercial fishermen in North America--from the First Peoples in Labrador to the shellfish watermen of Maryland's Eastern Shore. These are people who barely eke out a living as it is. Where will they go for ethical treatment when their livelihood is taken away?

I think anyone connected to these industries as well as all sport fishermen in North America, who are the real conservationists of this important resource, need to circulate this link and get the word out that these self-indulgent do-gooders have gone too far this time. With the current group in charge of Congress, they just might be successful.

Just thought you might like to know.

Things That Aren't There Anymore

Every spring when the weather starts to turn, I think about my first year in college. I packed my stuff up and lugged it down to the railroad station--to the little Railway Express Agency office in the back. For a small fee, my trunk was loaded on a rail car and transported to my home town, where the local agent called me to come down and pick it up. Railway Express, which went back to the early days of the 20th century, was at one time the only cargo shipper of its day. It was for a half century, the FedEx of its time.

I think about that each spring because if you said the name Railway Express Agency to most people they wouldn't have a clue what you were talking about.

So it got me thinking about some of those formerly well known things that aren't around anymore. Like:

• Montgomery Ward. If you lived in small town America, chances were that you shopped at Montgomery Ward. Montgomery Ward was to middle America what Macy's was to New York. At one time one of the largest retailers in the U.S., it fell victim to the changes in lifestyle, tastes and technology. Today the name lives on (sort of) in Ward's, a catalog retailer that purchased the name in 2004.


• Palisades Amusement Park. If you grew up in the New York City area anytime in the first seven decades of the 20th century, you know Palisades Amusement Park. Perched on the cliffs overlooking the Hudson River and Manhattan, Palisades was the Six Flags and DisneyWorld of its day, all rolled into one. Unlike Ward's, which passed quietly into retail heaven, Palisades was a victim of its own success. Wedged into a small corner of Bergen County, New Jersey, eventually it fell victim to local outdated transportation infrastructure which could not keep up with the crowds. When developers began drooling over the idea of high-rise condominiums that combined waterfront views and the Manhattan skyline, it was curtains for Palisades. The park closed and the land was sold in 1971.


• Riverside International Raceway. Located about 60 miles east of Los Angeles, Riverside was a premier road racing venue in its day. A.J. Foyt, Carroll Shelby and Dan Gurney were among the drivers in many series that cut their teeth at Riverside. Riverside opened in 1957 on the site of an old turkey farm. Grand Prix, Thunder Alley and Speedway were just some of the movies filmed on the location at RIR. With a long, downhill back straightaway and the 9th turn which tore the guts out of brakes, a circuit around Riverside could be harrowing. It's now the Moreno Valley Mall, less dangerous, but nowhere near as memorable.

What are some of the places you remember that aren't there anymore?

Just thought you might like to know that I'd like to know!

Reforming Healthcare Reform

Let me say from the outset, I'm not against healthcare reform. Lord knows it needs reforming. It costs too much, accessibility can be a problem, and its quality is uneven.

You've heard a lot of talk lately about "universal health care," or government subsidized healthcare. We have government subsidized healthcare now. Most Americans are covered by Medicare, Medicaid, or an employer's healthcare plan. The first two are funded directly by the government. The third is subsidized by Uncle through the tax code.

My family is covered my none of the above. We pay rack rate each month for health insurance. So I'm dialed in to this healthcare debate. If you want a really informed view of healthcare in the U.S. check out Conservatives for Patients Rights. According to the group's website, CPR is "a non-profit, 501 c(3) organization dedicated to educating and informing the public about the principles of patients rights and, in doing so, advancing the debate over health care reform. "

CPR sees 4 guiding principles in healthcare reform:

• Choice
• Competition
• Accountability
• Responsibility

The group also dissects the 16 plans that have been put forth for reforming healthcare in America.

You get the other side's vision for healthcare on the network news. CPR provides a healthcare roadmap that differs from today's Washington solution: throw a lot of money at the problem and see what works. That hasn't worked for the banks, it hasn't worked for car companies, and it hasn't worked for the credit markets. It's hard to see how the government-run approach could work in healthcare.

Just thought you might like to know.

Oppose Elena Kagan

Tom Chambers is the former mayor of the borough of West Chester, Pennsylvania. On March 14 he wrote a stirring op-ed piece in the local newspaper, creatively known as the Daily Local News, opposing the confirmation of Elena Kagan to be the nation's next solicitor general. I urge you to follow the link and check it out.


The solicitor general is the chief litigator of the United States. The solicitor general reports to Attorney General Eric Holder and is responsible for representing the federal government on legal matters right up to the Supreme Court.


Elena Kagan is a Harvard Law School dean, whom the Senate Judiciary Committee has approved to be the next solicitor general. She is awaiting Senate confirmation. Dean Kagan is virulently anti-military. In the past she has led the self-righteous charge to deny college students access to information by banning military recruiters from campus. Over the years Dean Kagan has called military recruiting:

• discriminatory


• deeply wrong


• unwise


• unjust

Dean Kagan is an opponent of what is called the "Solomon Amendment." The Solomon Amendment was part of a 1995 bill signed into law by President Bill Clinton. Under the bill, schools that stifle free speech by denying students the ability to learn about the military from recruiters on campus can't receive any federal funding from the Dept. of Defense.

Dean Kagan took the position against free speech and against education's traditional role as a marketplace for the free exchange of information by filing amicus briefs against the law before a federal appeals court and the Supreme Court.

The Washington Times put it simply when it called Elena Kagan "an anti-military zealot."

If the Congress approve's Dean Kagan's nomination, it will repudiate Pres. Obama's own words when he told the Service Nation Presidential Forum at Columbia University last Sept. 11 that it is a "mistake" not to offer students "the option of participating in military service."

Should this person be confirmed solicitor general, it will be one more indication that this nation is slipping irretrievably to the left. To stand up against this erosion of rights and to block Dean Kagan's confirmation, contact your senator, and let him or her know that you stand for free speech and self determination, and against the bigotry, self-righteousness and anti-military rhetoric of the 1960s.

Just thought you might like to know.

The Strange Case of Captain Hill

Roger T. Hill was a U.S. Army Captain with three overseas tours of duty under his belt. He was awarded the Bronze Star for his service in Operation Iraqi Freedom, as well as three Army Commendation medals. He was also Airborne, Air Assault and Ranger qualified.


Capt. Hill was a company commander with the 1st battalion, 506th Infantry Regiment in Afghanistan. His company was the smallest in its brigade, which was charged with securing Wardak province, an area about the size of Connecticut, and one where the Taliban had begun reasserting control over the local population. From the moment of its deployment Capt. Hill's company had taken heavy casualties, losing about a third of its strength.


In late 2008 Dog company rounded up a dozen local men who they believed had information on the whereabouts of the Taliban insurgents that were attacking them. Capt. Hill and another soldier were charged by a military court with abusing these detainees and with dereliction of duty for failing to report the incident. Capt. Hill's offense was discharging his weapon in front of these detainees. By Capt. Hill's account he was more than 20 years from the detainees when he pointed his weapon to the ground, away from the prisoners, and squeezed off a couple of rounds to get their attention.


Capt. Hills actions, and those of 1st Sgt. Tommy Scott, resulted in actionable intelligence that helped secure his area and protect his company. Nevertheless, he was subject to an an Article 32 hearing, the equivalent of a grand jury. The hearing officer found no evidence that Capt. Hill, Sgt. Scott, or their men acted in a cruel or sadistic manner, or were motivated by anything other than a desire to save their company more losses. Physical exams of the detainees, a statement of the base Executive Officer who examined the detainees, and a signed statement from one of the detainees all corroborated Capt. Hill and Sgt. Scott's assertion that no one was injured.


Nevertheless, an Army still sensitive to the blowback from Abu Ghraib wasn't satisfied. In a plea bargain Capt. Hill resigned his commission in exchange for an Honorable Discharge. However, when the discharge was granted it was a general discharge, a Discharge without Honor. Having upheld his part of the bargain, Capt. Hill has been working furiously to have the discharge upgraded. However, whether he is successful in this or not is in the hands of Army Secretary Pete Geren.


To stop this travesty of justice you can contact Sen. John McCain, the ranking (minority) member of the Senate Armed Services Committee and ask him to tell Sec. Geren to give Capt. Hill the Honorable Discharge he deserves. Or, you can contact any of the other committee members, especially if one of them is your senator, and tell them you want to see this decorated combat veteran treated with the respect he deserves:


James M. Inhofe (Oklahoma)
Jeff Sessions (Alabama)
Saxby Chambliss (Georgia)
Lindsey Graham (South Carolina)
John Thune (South Dakota)
Mel Martinez (Florida)
Roger F. Wicker (Mississippi)
Richard Burr (North Carolina)
David Vitter (Louisiana)
Susan M. Collins (Maine)


It's time that cases like those of Capt. Hill and Sgt. Scott's were handled according to the facts and not for how they'll play on the New York Times or the Huffington Post. It's difficult to understand why young men and women would want to choose a career in the Army if this is the way the Army treats is best and its brightest.


Just thought you might like to know.

Hecho en Washington

The Mexican government today announced that it had enacted tariffs on 90 U.S. products. This after the Democrat-controlled Congress cancelled a plan that allowed some trucks from Mexico to operate in the U.S.

The North American Free Trade Agreement, or Nafta, gives Mexican truckers the right to operate in the U.S., subject to U.S. laws as part of the open trade compact. However, Democrat congressmen, who are the whores of organized labor, take their marching orders from the truckers unions, and have made enforcement of this Nafta provision difficult. Now that they control Congress, they have eliminated altogether the compromise provision that had allowed some Mexican truckers to operate here.

This is protectionism, pure and simple. The union bosses, in their inimitable greed, have said, the hell with you, we're in this for ourselves. And congressional Democrats have done what they always do. They've stuffed the money in their bra, and hit the street on the orders of their union pimps. Because of the Democrat Congress, American workers will lose their jobs because the the tariffs will make their products too expensive in Mexico.

The alleged party of the people has thrown American workers under the bus in order to please their union masters.

The Mexican government has a lot to answer for in terms of bilateral relations. They have sat by and watched while their drug barons have ignited a civil war that has spilled across our borders. By their socialist mismanagement of their government, they've forced millions of their own citizens to flee to our country illegally. And their opaque, oligarchical form of government has made doing business in Mexico a nightmare for most American companies.

But this is one case where Washington is wrong. Congress has sold out to the union bosses, as they're about to do on the card check bill. And the loser is the American people.

The next time your Democrat congressman tries to lay that populist rap on you --how they stand up for the little guy, and how the Republican Party is the party of special interests--don't believe it. The Democrats are the party of the biggest special interest in America.

Themselves.

Just thought you might like to know.

Schoolin' Obama

Pres. Barack Obama made his long-awaited speech on education to much fanfare yesterday. Today the results are a little different. When it comes to rescuing the economy, a panel of leading economists in a Wall Street Journal/NBC poll today gave the President failing grades.

And these are some flat out, ugly grades:

• The President's average grade on the economy was 59. That's 59 out of 100.
• Better than 40% of the economists surveyed graded him below 60
• Wunderkind Treasury chief Tim Geithner did even worse. He pulled an average grade of 51. Must not have had anyone to sit next to.

The economists generally dismissed the financial stewardship of the President and the tax-challenged Geithner. 43% say that the we'll have to pony up another half a trill to get out of this hole. Others say that the stimulus ship has already sailed and dumping more money down this rat hole won't help a whole lot.

Bottom line: The Obama Treasury promised too much and delivered too little. Sec. Geithner, who is fast becoming this administration's Alberto Gonzales, has generally bombed out with Wall Street. Since his much ballyhooed economic turnaround speech on Feb. 10, the stock market has shed 20% of its value. Not a real vote of confidence.

This poll is the latest example of an administration that overwhelms and underachieves. It's as if Pres. Obama barely has time to focus on the economy amid all of his social engineering.

The President was elected primarily on emotion and secondarily on his promises to fix the economy. Now is the time for him to do that. If he's successful he'll have earned enough political capital to fulfill his dream of Europeanizing the U.S. If he's not, it won't really matter at all, will it?

Just thought you might like to know.

The Long Road Home

Stocks plummeted again today. The Dow Jones Industrial Average sank over 200 points to finish at 6600. That's its lowest close since April 15, 1997. 15 months of recession and no bottom yet.

Wait--I'm not even to the bad news yet. The bad news, as Jason Zweig wrote in last week's Wall Street Journal, is that the road back from a calamitous recession like this can be long and filled with potholes.

In his piece, Zweig describes the work of finance guru Elroy Dimson of the London School of Economics. Professor Dimson and two colleagues studied 17 stock markets from around the world, going all the way back to 1900. Their takeaway: We'll have to wait another 9 years before the Dow has even a 50/50 chance of getting back to where it was two years ago.

If you're looking for some advice on what to do in this market, good luck. Prof. Dimson's conclusion: It's pretty much hopeless.

A double whammy awaits your IRA or 401(k). First, stocks have lost a great deal of their value. Some portfolios are down 30% or more. But second, when stocks to begin to appreciate, don't look for the tremendous increases of the past decade. Having suffered third degree burns on equities in this recession, investors will be leery of stocks. The result: slow appreciation of value.

Let's add a third whammy. As you read this, the government is inking the presses, printing banknotes to cover the record spending spree that the President and the mob in Congress are engaged in. The result will certainly be rampant inflation. So those stocks you bought with 1988 dollars, believing that they always appreciate in value? They'll be worth a lot less in 2009 or 2010 dollars. If you try to cash out of the market, the value each dollar you receive will be less than the real value of each dollar you paid.

Nobody here gets off without blame. Not the Republican president who presided over the biggest growth of entitlement spending in the history of the Republic. Not the Republican Congress who squandered the trust of a nation on an orgy of earmarks and corruption. Certainly not the Democrat Congress which has seen the economy tank virtually since the day it reclaimed the legislative branch from the Republicans. And most of all the current president who hijacked his party's nomination as an English speaking Hugo Chavez populist, then masqueraded as a somber, statesman-like centrist to win the presidency, and now presides over the country's rapid decline, which he has neither the experience to the aptitude to stop.

Just thought you might like to know.

Pain Equals Wisdom

The passing of John Odom last November went unnoticed by even the most dedicated baseball fan.

John Odom was a 26-year old minor-league pitcher scuffling through long bus rides and taunting fans--all for a chance to play baseball. He will ever be known as the player traded from the Calgary Vipers of the Golden Baseball League to the Laredo Broncos of the United League for ten maple bats.

Both the Golden and United leagues are independent circuits--what used to be called "outlaw" leagues, meaning they are not affiliated with Major League Baseball. Outlaw leagues are located in, as sportswriter Jimmy Cannon once said about boxing, the red-light district of sports.

Having been signed by the San Francisco Giants, and having been released by one of their lowest minor league affiliates, and finally ending up in an outlaw league, John Odom, a self-described "lost cause," was clearly working his way down the ladder of success.

A young man once possessed of a blazing fastball, knee-buckling curve, and wicked guitar, John Odom struggled to find the path to redemption. Notified of the trade, he drove 30 straight hours to get to his new team in Laredo. Odom tried to take the trade in stride but some teammates said being the punch line to a sports joke eventually got to him. Last July he left his team and went back to Georgia. In November he was found dead from an overdose of heroin, meth and alcohol.

Funny thing is, many of his former teammates didn't know about his death. After the fact, many talked about how he good naturedly bore being the butt of countless jokes about the trade, but how on the inside he died a little every day.


Eventually it got to be too much and he left the team. His manager and former teammates shouldered on, focused on their careers. Most were oblivious to the pain John Odom lived with and quickly forgot him when he left. Most were unaware he had died until contacted by the press.

How many John Odoms are there out there? Folks that soldier on carrying excess bagage that we never make an effort to find out about or help with. We get up, go to work, and come home and never really know the people we meet along the way. In one way or another, we're all lost causes like John Odom.

It wasn't until the Medical Examiner's staff saw John Odom's elbow that they realized his former profession. The ballplayer bore a snake-like scar where he had had reconstructive elbow surgery--the punishment for pitchers who tax the joint too much. Tatooed across the scar were the words "Poena Par Sapientia."


Latin for "Pain equals wisdom."


Just thought you might like to know.

The Real Confidence Game

The Dow Jones Industrial Average fell today below 6800.


That might not mean much to readers who are not that familiar with the stock market. So think of it this way. There are two reliable indicator's of the country's economic health: the unemployment rate and the Dow. The unemployment rate is a "trailing" indicator. That is, the unemployment data trails by several weeks the employment picture at the current time. That's because it takes a while to collect and report the data



The Dow, on the other hand is a "leading" indicator. That means that the data is current. With the Internet we can actually follow the Dow all day in real time. The Dow is important because it gives us a current picture of economic activity of the 30 "component" companies that make up the index. These are companies whose reach and breadth are so big that they are felt in all corners of the country and in all sectors of the economy. They employ many people and purchase billions of dollars of goods from other companies who employ thousands more.



Why should we be concerned? Well, because most of us: 1) work for one of the components, or 2) work for a company that does business with one of the components, own stock in any of those companies, or 3) own shares of a mutual fund that owns shares of any of these companies, or 4) some combination of all of these. Plainly put, the Dow touches most of us, not just the Wall Street swells.


So when the Dow free falls through 6800 it's big news. How big? This big:

• To get below 6800 points today the Dow dropped 300 points in a single day


• It had not closed this low in 12 years--when Bill Clinton was still president


• The overall stock market has fallen 4 straight days now


• The market has fallen in 10 of the last 12 sessions shedding 15% of its value along the way


• Today's trainwreck was universal--the share prices of all 30 component companies fell

Why the drop? Joe Battipaglia who works for financial company Stifel Nicolas, says the big money men have finally concluded that this recession is the real deal and won't improve anytime soon. Most troubling is his conclusion that people are starting to realize that the government doesn't have a clue how to fix things.

Doreen Mogavero, principal of the only all women-owned brokerage on the floor of the New York Stock Exchange is even more bleak in her assessment: The financial bleeding will only stop when people run out of stocks to sell, she tells the Wall Street Journal.

Those enormous political rallies from last summer and fall--the ones where America drank the Kool Aide of "change we can believe in" seem light years ago. Despite the President's attempts to look presidential, and the Congress' attempt to take over vast sectors of our economy, no one really has a lot of confidence in them. Period.

Despite the President's continued popularity, polls show that nearly two-thirds of the country still thinks we're in a canoe going backwards over the falls. And, while the President has been in office less than a month, neither his enormous stimulus plan, his enormous budget, or his immodest plan to change the role of American government forever, has moved the needle one bit on the confidence of the American people.

I don't think most people signed up for this when they pulled the lever in November.

Just thought you might like to know.