Category Archives: The Economy

It’s a boring job, but somebody’s got to do it.

Live long, and prosper

While God, guns, coal, and fracking remain our salient political issues in the U.S. and we debate whether or not health care is a human right, I hope that young people are hearing about these new technologies and getting as excited about them as I am. I am revising my intent to not live much past 100, just so I can see a lot of this stuff happen:


Ken Cuccinelli now says that Obamacare is fine

Virginia’s Ken Cuccinelli, a major force in bringing the constitutionality question on PPACA Obamacare, is now fine with the decision by Justice Roberts. He states that he did not consider the legal position that Roberts put forward in preserving the law. In an interview with The Washington Post, he said “That was not one of the combinations that were even in our top five. That permutation was one that we didn’t spend a lot of time thinking was a likely outcome.”

Why he didn’t think of interpreting the mandate as a tax is not clear, given that many in the GOP were crying that it was a tax. Perhaps he did not consider this interpretation because, if he had, he would not have had a basis for a lawsuit. The good outcome for Cuccinelli in forcing a ridiculous lawsuit into the Supreme Court is that it made his name among the radical right. Without Cuccinelli, perhaps there would have been no constitutional challenge — Lots of money saved, lots of stress averted — but not nearly as many people would know his name. It is difficult not to think he used his public office for political advantage. Regardless of the outcome or the merits of his lawsuit, his opposition to Obamacare kept his name in the national headlines effectively for over a year as a champion of the opposition to President Obama’s signature health care bill. Virginia taxpayers could wish he had thought about that permutation before filing the lawsuit and saved all that expensive ruckus.

How and why not to get private student loans

Here is why you should not get a private student loan:

Here is how you can avoid private loans, even if you were not wise enough in the beginning to choose parents who could pay for college:

  • Do not go for one of the do it at your own pace, study at home, we will lend you the money if your Pell Grant doesn’t cover the cost on-line universities. These are money mills for their operators and money pits for students.
  • Go to your local community college and tell them you want a 4-year degree from the state university, and you want to do your first two years at the community college (CC).
  • If you know what major you want at the university, call the university and talk to a counselor who will tell you what course of study to take at the CC. Get something in writing, even if it is only an e-mail, and follow the advice of the counselor.
  • If you don’t know what you want to study, get a job stocking shelves, bagging groceries, making hamburgers and fries, typing, answering the phone, plumber’s helper, running a cash register, waiting tables, or something that earns you a little bit of money while you make up your mind. This work experience will be valuable to you if you want to work part-time or do student work-study while attending college.
  • If you don’t know what you want to study but you just HAVE TO GO direct to college, go to the CC and major in English, History, or Math. The one of these three that appeals most to you will probably be a strong foundation for your later choice of majors. This is true because they are foundational subjects in the three major divisions of the curriculum, Humanities, Social Sciences, and Natural Sciences.
  • Get the 2-year AA or AS (Associates) degree. Work hard and make “A’s.” If you aren’t making good grades, ask for help. Community Colleges can assess weak points and help you meet your goals.
  • Check with your CC counselor to be sure you apply to your state university at the right point in your AA/AS program.

Private schools are not universally bad, but they cost more than the university. To justify the higher cost, they say that at the university you will be a number. Actually, although the university is large, your classes and your major become your community within the university. Your professors will care about you with about the same frequency that students experience at a private college. Your resources will be greater, as labs and libraries will be better equipped. There will be more plays, concerts, lectures, and gatherings. And your alumni network will be larger when you are looking for a job.

Oh — and don’t forget to vote for Democrats. People who believe in education invest in it. If you can’t find the data on who believes in education, just take my word for it. Democrats. Vote for one every time you get a chance.

Origins and consequences

Virginia’s Delegate Israel O’Quinn responded to my letter:

Thanks for your message. I can tell you for certain that not a single piece of legislation I filed was influenced by ALEC or any other national legislative organization. The bills I filed, and will continue to file, come directly from constituents or are items of interest for our region and/or Commonwealth.

He responded also on the matter of the economic impact of abortion-related bills, stating that “normal operating practice” is that every bill receives an economic impact statement. He said, “I’m not sure how your suggestion would expand that particular practice, but it is certainly a question for Legislative Services as I am not quite sure of the answer.”

I appreciate Delegate O’Quinn’s thoughtful response, which demonstrates that he is listening to voters. I am seeking the economic impact statements for the abortion-related bills in the Virginia legislature, and will post a link when I have that information. Updated Wednesday, April 4, 2012.
Open and responsive government that takes care of business efficiently is what we need, and a citizen’s understanding of origins and consequences of bills before they become law is critical to this goal. Legislators also need to know where ideas come from and what their predictable consequences might be.

I recently sent a few comments to Delegate O’Quinn regarding the State Corruption Risk Report Card for Virginia. He responded that he too was disappointed, pointed out the problems of perspective in the report, and stated that he was committed to more open and accessible government in Virginia. I have no reason to doubt his commitment, and I hope that he will honor that as this legislature goes forward. I offered two suggestions for improving openness and accessibility in my letter back to him, reproduced below:

Dear Delegate O’Quinn:

Thank you for your response. I too was disappointed with this report card in Virginia, and while I agree that electing judges is not good, I believe we should have non-partisan judges. Judges should be committed to the equal and non-partisan administration of the law.

In the past — I am 67, so I have a lot of past — elections were partisan, and after the election legislators worked on substantive questions of the Commonwealth like infrastructure and improving the lives of citizens. I have recently been disappointed to learn that over 50 of the bills introduced in Virginia — including virtually all of the pro-gun, anti-woman, and public education assault legislation — were written by ALEC, and not by any Virginian at all. What does this say about us, about the neglect of the responsibility to govern among our elected representatives? Can we no longer govern ourselves? Are we enslaved to people we do not even know are controlling us?

As to suggestions for how to make government more open and accessible, I would appreciate the tagging of each piece of legislation that has been influenced by ALEC and an attached description of the ALEC recommendation that influenced the law on your website.

In an associated matter, I cannot tell you how disappointed I am with the frivolous agenda of the Virginia legislature in the current session, so demeaning to women. In the light of modern science and medicine, our legislators brought the debates of the 1500’s to 1700’s back to the floor. These debates are based on religion and on a pre-scientific understanding that men constitute humanity and are the generative force in procreation while women are “instrumental,” contributing nothing. Surely we are not going to be asked to accept that we are men’s tools for reproducing themselves, and that we have no rights to our own bodies.

The ancient nation of Israel in the Old Testament had birth control, but they had a need to increase population. Maximizing procreation was a practical matter for them, and their rules for sexual behavior did exactly that. The rules that were practical in their time are contrary to good sense for us. Neither the economy or the biosphere can sustain maximum procreation here and now. And making women primarily a means of reproduction by shaming, by limiting choices, or by limiting access to birth control is reprehensible.

It is even more onerous to understand women’s lives in this way when the rules you have made will affect only low-income to moderate-income women — wealthy women have always had access to safe abortions, and they always will have, law notwithstanding. If your daughter can afford two weeks abroad, she can go where the law is more sane and more humane, and return without the problem and without any record of ever having had the problem. Only poor and middle-income women are affected, and none of our families can afford to rear and educate 15 children.

As to suggestions for how to make legislation about reproduction more open and accessible, I would appreciate each piece of legislation regarding women’s reproductive rights to be accompanied by a published economic and environmental impact statement, showing 1) how it will impact the ability of young women to become self-sufficient and on their own economically, and 2) how it will impact the ability of parents to provide adequate medical care, living space, education, and recreation for their children, and eventually how the Commonwealth will generate jobs for a constantly booming population, maintain a safety net for those who are disabled or who become disabled, and care for them as they reach retirement age.

Thank you again for your response, and for the opportunity to share my concerns and suggestions.


– Sarah

Open letter to Senator Mark Warner

Dear Senator Warner:

As the text of S. 1247, a bill to develop and recruit new, high-value jobs to the United States, to encourage the repatriation of jobs that have been off-shored to other countries, and for other purposes. comes available, I will follow it closely. This is an important issue, and attracting “new, high-value jobs to the United States” is a number one priority. I hope that your bill has considered the environment in which jobs grow, one in which:

  1. people have economic security — money — and can purchase goods and services,
  2. the infrastructure will bear the weight of the commerce, and
  3. there is a rich culture to enjoy and opportunity for children and families.

Recent downturns and responses to them based on cuts in spending have reduced all three of these aspects of our economic environment. Above all, it is the responsibility of government to maintain a culture in which people enjoy living and have opportunity. Our corporate welfare focus is foolish. We need to build infrastructure, take care of the health care mess once and for all by extending Medicare to everyone who wants to enroll and supporting Medicaid. We need to defend — and extend — Social Security and restore the retirement age to a reasonable 62, which would open up opportunity for young people. Older people who can scarcely keep up the pace are now locked into jobs they are no longer able to do by the necessity to keep employer medical insurance and the prospect of poverty with reduced Social Security. Let older Americans retire and spend their retirement accounts and Social Security on travel and support for their children and grandchildren — something other than medical care — and the economy will turn around.

I look forward to voting for you again and again as our Senator from Virginia, and I hope I will get to vote for you for President in the future. Please understand that I do not want to take away from business, but business does not thrive except in a dynamic culture that produces demand for goods and services. Money trickles up, not down, and we know this every time we pay our credit card payment. If we keep cutting off our most vulnerable and forcing our middle class into poverty by low wages, expensive education, rising food costs, rising energy costs, abusive credit practices, and tax incentives to wealthy private corporations we will not survive.

For an economy to thrive, some of the money that goes up needs to be forced back down to the bottom so that it can recirculate. The way to do this is to collect taxes from the people who use our labor force and our infrastructure and our consumer base to become wealthy. The wealthy are not the source of jobs, they are the result of many people working to get by and to have a few dollars extra to take the family to the beach once a year and to carry smart phones in their pockets. The working people are the source of jobs and the source of wealth because they both do the work and generate the demand for goods and services. Infusing money at the top and asking corporations for the favor of a few jobs is utterly ridiculous.

I hope that your new bill considers the workers in the United States when you are thinking about jobs, because if our workers are not healthy and hopeful and do not benefit from their work we will not have an economy no matter how much money we give to corporations.

I hope also that you will see this message. I know that you receive many letters, but this message is clear. In the United States today we are seriously talking about taking out the foundations of the economy and trying to sustain the wealth at the top by giving more money to wealthy people. This is a third world solution, and we can do better.

Discussions don’t have to end in bloodshed

When someone sees all opinions as equal — i.e., any person has a right hold any opinion — all discussion is circular. People who are trapped in that false construction of reality feel personally threatened by conflicting opinions. But they are lucky in one way: they have it pretty easy in the research department.

When a person sees opinions as derived from weighing the facts, the conflicting opinion is not a personal threat, but it does present you with a lot of work. First you have to see what facts the other person uses to justify their opinion, then you have to see how those facts fit into the larger context of your opinion and your known facts, and then you have some fact checking and connecting of the dots to do before you:

  • change your mind and agree with the other person,
  • continue in disagreement with facts to sustain you,
  • or arrive at a third opinion that incorporates all of the facts.

Sometimes the gathering of facts becomes so involved that you can’t remember the original conflicting opinion, but you have the benefit of the study even if you can’t remember what the object was. (Hint: Wikipedia is cool, but set a timer.)

Once you start gathering, verifying, and associating facts, you discover how seldom you have all of them. Some are hidden for later discovery — often in hopes they will never be found — and new ones keep popping up. Example: I might spend money today at Sam’s Club. That will invalidate several facts in Sam’s inventory, in my bank account, and — if I trip over the curb and break my leg — in whether or not I can drive a car. So if someone verified any of those facts yesterday, their facts would be outdated.

Sometimes people pick their fact set to persuade you to believe something contrary to the truth, maybe in order to move money from your bank account to theirs. So you have to see who is using what facts to promote what opinions and what they are leaving out, and there you have another whole set of dots to connect.

Keeping conflicting opinions in the factual universe and connecting the dots is worth the effort. You can learn new things, modify an opinion without bloodshed, and break out of the circular discussion. Frequently you can even keep your friends, since you don’t have to kill them, silence them, or shame them.

Probably the greatest advantage of forming your opinions in the fact-based universe is that the fabric of that universe is not easily ripped by shouting heads. You can study the deficit, tax breaks for big oil, tax breaks for millionaires, or any other issue in the opinion mill, without feeling like it is a deadly tumor in your own personal cranium. Nobody is expected to be rational about a deadly tumor in their own personal cranium, but the number of people who are irrational about public policy issues today is — well, irrational.

Who would pay us?

A Facebook friend recently asked, “If everyone worked for the government (as some people are suggesting) then who would pay our salaries?”

I have not heard this suggestion, but it is interesting. If indeed we all worked for our government, the government would pay our salaries. Since we have a democracy, a “government of the people and by the people and for the people,” we would all be working for ourselves and paying ourselves.

Governments that are not democratic usually have a monarch or some monopoly that owns everything, and individuals do commerce by permission or charter. It still appears to workers that they work for whoever hands them money on payday, but that person is a middle-man with a charter or lease from the king. All persons work for and at the pleasure of the king. This arrangement is what Adam Smith was looking at when he wrote The Wealth of Nations and explained that wealth was not accumulated money sitting in the king’s treasure rooms, but rather was money that was moving through the economy from hand to hand to hand, earned and spent sequentially by many people in the pursuit of their ambitions and dreams.

In any case, the person who has a job is the person who is making the money as well as the person who is getting paid. The employee is “making the money” for the employer. The employer uses the money that the employees make to pay each worker’s salary and benefits, to pay applicable taxes, and to maintain and furnish workplace necessities. What is left over after these expenses is profit for the owner or owners, investors and capitalists, people who ideally pump that money back into business in the hope of making more profits. If they put it in their treasure rooms, it is drained out of the market and the market is diminished.

So each employee earns a salary by making money for the employer. Successful employers are usually hard-working, hard-headed practical ambitious people who know that their income depends upon employees, customers, suppliers, and clients. Employees depend upon the employer to understand and adjust to the market and to keep designing the work and the product so that everybody in the system keeps their job and makes a living.

Nobody in the system requires charity from anybody else in the system. It is a cooperative effort in which members owe each other respect and considerations that keep the system going — salary, benefits, hard work, etc. The employee and employer system in turn depends upon that broad complex of roads, railroads, bridges, communication lines, power lines, safety regulations, police, fire departments, childcare, elder-care, hospitals, health care, financial institutions, laws, courts, schools, worker protections, consumer protections, contracts, etc., that permit people to live with confidence, take risks, innovate, and pursue their dreams.

An economy is not simple, and it is time we learned to look at complexity.

Don’t raise the retirement age

I am retired and will soon be — well, over 65. So in some ways, I don’t have a dog in this fight. However, I know that we should not raise the retirement age to 70. We should lower the age at which a person becomes eligible for full Social Security to 62 and lower the Medicare eligibility age to 62 as well. The raises that have been made already in Social Security eligibility age are part of the problem with jobs and the economy. There are at least three considerations:

  1. Older people must work longer because they can’t afford medical insurance, so jobs don’t open up for young people at the entry level.
  2. People who work longer because they can’t afford medical insurance add to business payroll obligations due to more longevity raises that they receive, so businesses pay more for older workers. In some cases the higher pay is justified because a seasoned experienced worker is worth more than one with less experience. However, depending upon the job and the changes that occur over time in necessary skills and abilities, the reverse may be true. When this happens, a business is caught with either letting a loyal employee go near retirement, which is cruel, or holding on to the employee when a change would be better for business. The employee in such a situation almost always senses the problem, feels like it is time to go, and would choose to retire if he or she could do so and still have an income and medical insurance. This choice is now precluded until the worker is 67.
  3. People save for retirement and then spend their retirement money when they retire. They spend money on travel, retirement homes, new cars, etc. They support community activities, show up at theatre matinees, volunteer, and help out with the work of their church. They sometimes babysit their grandchildren so their children can go on vacation or to dinner and a show. All of these activities put resources into the economy.

So it would be counterproductive to raise the retirement age, just as it has been in the past. History is a great teacher, and we should listen better in history class.

Why a voter needs to think about the details

It is purely not enough to kick out the corrupt politicians and put in new people who promise to do better. You need to know what each person you are considering for office thinks about particular issues. For example, on the matter of a just way to collect taxes and pay for essential services for people, first you need to understand what taxes are and then you need to think about who should pay them and why.

Taxes can be one of three patterns:

  1. regressive (the lower income person pays a higher percentage);
  2. flat (everyone pays the same percentage);or
  3. progressive (the higher income person pays a higher percentage).

Sales tax is always regressive even when people pay the same rate, since you are taxed on what you spend, and the person who spends all of his/her money gets taxed on 100% of their money. A poor or middle class person spends all or most of their money, and if they use a credit card, they can actually pay sales tax on more than 100% of income. A wealthy person not only has unspent money not subject to sales tax, but is able to invest leftover money and earn interest, so taxes are offset by interest earnings. Most people with incomes over $200,000 a year, when their taxes are offset by the interest and dividends they earn on investments, currently pays no tax at all.

Here in Virginia, all taxes taken together — property, sales, and income tax — the poorest quartile of the population pays about 8.5% in state taxes, and the wealthiest quartile pays about 5.2%. This does not take into consideration the matter of interest and dividend earnings that are available to wealthy people to offset taxes.

At the national level, a progressive income tax has been in place in the U.S. for a long time, with the rich paying substantially more as a percentage. Tax shelters have served both the wealthy and middle income people, with middle income tax shelters largely limited to “before tax” retirement and medical savings accounts. A wide variety of tax shelters are available if you have enough money to use them, but most of us do not. The average wage in the U.S., even with rock stars and athletes calculated in, is somewhere around $40,000 to $45,000.

The Bush tax cuts, which all of the Republicans and Tea Party candidates want to continue and make permanent, were a windfall for wealthy people. The intent of the tax cuts was to enrich the wealthy so that they would be inspired to invest and hire more people to work for them. Instead, they have simply taken the money out of the market into their pockets, and it rests there doing nothing for the economy. Large financial magazines and newspapers have commented on this failure to invest as expected, and if you want to read about it, you can Google “tax cuts for the wealthy not invested in jobs” and “businesses sitting on large cash reserves.” There is nothing else that we can give the wealthy to inspire them to invest. In order to get the money back into the economy, we need to roll back the tax cuts for the very wealthy the way that the Democrats want to do.

It is fair for wealthy people to pay a larger percentage in taxes because they make more money, i.e., take more money out of the economy. This is a simplistic statement of why a progressive (rich pay a higher percentage) income tax is reasonable, and if you want to read further on the issue, check out “Why the rich should pay more” over on

Understanding the information above, which anyone can verify easily with nothing more sophisticated than a Google search, indicates a clear choice for Democrats, who support a progressive income tax and the expiration of the Bush tax cuts for the wealthy.

Attorney General Cuccinelli’s Town Hall Rally

Virginia Attorney General Cuccinelli arrived early for the Town Hall in Abingdon on Thursday, Sept. 2nd, and he circulated among the gathering crowd in a very personable manner, followed along at a discrete distance by Morgan Griffith, Virginia State Representative from the 8th District, who is running against Congressman Rich Boucher for the Ninth District seat in the U.S. Congress. The topic of the town hall was of course Cap and Trade, the issue that Griffith has defined as the vulnerable point for Boucher in the Ninth.

Knowing the issue well and being familiar with the rhetoric surrounding it as well as the stark reality of the human and environmental cost of coal and oil production, I heard little new in Mr. Cuccinelli’s presentation. He did, however, reference a study by the Heritage Foundation showing Virginia utility rates doubling by 2035 due to Cap and Trade. He also predicted that Virginia would lose 50,000 associated jobs. He said that many studies had been made, but this was the “most credible study.”

I was unable to find the study that Mr. Cuccinelli cited on the Heritage Foundation web page, and I went to Mr. Cuccinelli’s web page to see if he had posted a link to the study, but I could not find it there either. I went back today for another search. The site has no search function, and I went through many menus, finally locating the figures that were quoted in a “paper,” not a study.

So I can stop wondering how the “credible” study was constructed, whether it took into account the projected development of clean energy production, or whether it considered jobs created in clean energy in the job loss prediction. It does not matter what it considers, because it is a paper and not a study. The predictions in the paper have the same weight as the claim that I remember did so much damage to the fight for an Equal Rights Amendment for women, the one that said if we had an equal rights amendment women would all have to grow chest hair. But a paper is not a study. I digress.

The predictions of the paper were given more credibility by inclusion as a slide in Mr. Cuccinelli’s PowerPoint presentation.

The lone speaker at the Town Hall for environmental issues was repeatedly interrupted with shouts of “Sit down!” and “Shut up!” Mr. Cuccinelli interrupted him to ask “Do you have a question?” This was surprising, since he had explained earlier that some of the best ideas put forward by legislators in Richmond come from constituents, and told folks he was here to hear questions, comments, and suggestions.

The USA may be the last place in the world to have clean energy because our elected officials are deeply invested in and indebted to dirty energy at both state and federal levels. They actively deny opportunity in research and development, or we would already be burning coal cleaner than we do. Mr. Cuccinelli pointed out one such denial, Virginia’s refusal to consider even a portion of the $10,000,000 cost of carbon sequestration research in a rate hike request by a Dominion Power. This denial was also in his PowerPoint. He was taking credit for making sure that the power company did not pass along the cost of this R&D effort to the consumer.

The actual difference between the position of Rick Boucher and the position of Morgan Griffith in the matter of Cap and Trade is minimal, and the difference in what actually comes about will never be known. We will elect one or the other and never be able to compare them. Of course the loser in the contest always gets political sniping rights, so whomever we elect, the other one will be able to say he could have done better. That is the way politics works.

I hope that people in the Ninth recognize the ability that Congressman Boucher has to represent them in Washington, that they will think of the clean water, jobs, broadband, roads, and other infrastructure that he has brought to the Ninth District. Surely they can see his commitment to coal if they are looking. I can see it very clearly, and I wish he had a little less commitment to coal. But coal production is one of those complex issues that would get better for everyone if we could look straight at it and work on creating better processes.

I hope also that Ninth District voters in November will remember Congressman Boucher’s many services to individuals in the district, both Democrat and Republican. If a person lives in the Ninth and cannot personally name four or five people who have been assisted over the years by Congressman Boucher, that person has not been paying attention.