The Kindle is a Grinch

Ann wanted one thing for the holidays, a Kindle, so badly in fact, she opened that box from Amazon as soon as my gift arrived, activated the device and now she carries it with her wherever she goes.

But I was not thinking through the serious collateral damage in giving her such a Christmas present. It now deprives me of the one great gift giving pleasure I have had at this time of the year, deciding what books to give her, wrapping them carefully, taking such pleasure in hopefully guessing what she would love, handling those handsome books, some with deckled edges or beautiful illustrations, and then sharing the experience of watching her open them on Christmas morning. Simply put, I now no longer have anything that I love to buy for the holidays as I really don't enjoy almost any other gift giving.

The truth be told, I would also slip in a book or two that I know I would enjoy reading, maybe a recent novel by Anne Tyler who we both love. And that is another Kindle theft -- how does she share a downloaded Tyler novel with me after she is finished reading it if she is always on the Kindle?

I'm not a Luddite, and see the advantages of the Kindle, particularly for traveling, but apparently it is addictive -- once hooked, that is how one reads. The holidays have changed enough for us, having raised our children, they now living far away, so we have segued from the snowy family Christmases in Connecticut, the big fresh cut tree, setting up the train set for the kids and wrapping their presents, and let's not forget one another, to the artificial holidays here in Florida (although there is a wonderful tradition here to light luminaria all along our road on Christmas Eve) .

The only remnant of our own Christmas decorations is now a wreath on our door, but, still, there was always the anticipation of giving books for the holiday, a pleasure now stolen by the Kindle Grinch.

Nonetheless, from Christmases past, Happy Holidays to all, and to all a good-night!

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Winter Solstice

The winter solstice was special this year because of a rare eclipse of the moon. But for the last thirty years or so it also has been a special day for my friend, Ray, and myself. Wherever we may be, we always made it a point to speak on that day. This ritual was to acknowledge that although the long cold days of winter were just beginning, the days were getting longer and it will only be a matter of time until our families would be back boating together again on the Long Island Sound and spending many weekends at our mooring off the Norwalk Islands. It also marked the beginning of our thinking about our traditional summer vacation at Block Island

Now, with our families grown, and both being retired, our boating lives have changed and in fact as he and Sue now spend their winters in the Bahamas on their boat 'Last Dance,' and we live in Florida, except during the summers when we still live on our boat 'Swept Away' in Connecticut (and they return to Norwalk as well on their boat), perhaps this particular day has lost some of its significance. Nonetheless, I will make the call or await Ray's call and we will talk, perhaps of days gone by but also of next summer, but certainly to commemorate the moment.

Coincidentally, when Google Maps updated last summer, Ann and I just happened to be out on our boat that day, alone at the mooring we had shared for so many of those summer days. By putting in the Lat/Lon coordinates in Google Maps 41.061561,-73.388698 will first show the nearest land, and below that point the green arrow points to our boat on that particular day. A rare happenstance, a satellite view of the moment, perhaps like an eclipse on the winter solstice?
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My Second Session with Freud

In the blink of an eye almost a half year has gone by since we saw the NYC premiere of Freud’s Last Session by Mark St. Germain, wondering how it will translate to the venue of Dramaworks in West Palm Beach. Last night we attended the preview of the production which was directed by Bill Hayes, who is also the Producing Artistic Director of Dramaworks, the best (and most serious) theater in South Florida. He had promised something "different" than the NYC production, and he delivered.

The play is about a fictitious meeting between two great thinkers, C.S. Lewis, the Christian apologist, and Sigmund Freud, the father of psychoanalysis and a staunch atheist, towards the end of Freud's life and at the onset of WW II and is set in Freud's study in London. In a sense, the outbreak of war is another "character" in the play, one which helps develop the dramatic tension. It is a perfect conceit to spin a play about great ideas confronting the inexplicable transience of life and the gathering storm of man's inhumanity to man. Still there is a playful humor between these two great philosophers and this helps to relieve some of the tension of the intellectual dialogue. They both seem to agree on one thing: "humor tips the scales."

The New York Times review of the NYC production, while overall praising the work, was critical of there being a “lack of tension” or lack of “suspense.” Dramaworks has addressed that, getting to more of the core emotions of the two, sometimes finding they share more as human beings in spite of their philosophical differences. Of course it helps to have two fine actors to direct, Dennis Creaghan who I will always remember for his role as Don, the owner of the junk shop in David Mamet's American Buffalo which played last year. It shows the range of his acting abilities to go from the staccato street dialogue of Mamet to the thoughtful, brooding pronouncements of a Freud. Chris Oden, playing Freud's foil, C.S. Lewis, always seems to have the perfect theist rejoinder to Freud's scientific view, and Oden plays the role convincingly with passion.

I had said in my "review" of the NYC production that we felt as if we were in Freud's study, but that sensation has been used to even greater advantage by Hayes, and his set designer Michael Amico, in the intimate setting of Dramaworks' theatre, where the audience sits, literally, on the very edge of the stage in a stadium seating configuration -- rather than having to look up at the action as it was presented in NY. Dramaworks has perfectly replicated a typical London mews apartment and faithfully captured Freud's study with his ancient artifacts, even down to copying the chair he sat in!

Kudos again to Palm Beach Dramaworks, theater to think about which always rises to the occasion.

Finishing The Hat

This is one of the most remarkable documents of the theater that I've ever read, so exceptional in fact that I'm having trouble breezing through it, instead savoring every word. So even though I'm only half-way through, I'm writing a "first installment review," a respite from the political and economic shenanigans I've been held hostage to over the last few weeks. I prefer to think about great literature, music, or theater and Finishing The Hat; Collected Lyrics (1954-1981) with Attendant Comments, Principles, Heresies, Grudges, Whines and Anecdotes (Alfred A. Knopf, 2010) is a perfect Trifecta.

This is a detailed account of the American Broadway theater (1954-1981) written by our greatest living Broadway composer and lyricist, Stephen Sondheim, arguably the greatest ever.

As the subtitle hints, it is not only an erudite, introspective, and sometimes self deprecating account of his own works with the complete lyrics, both those retained and discarded for the shows he wrote during the period, it is also a frank discussion of the "major players" of his time, most of whom he of course knew or knows, and some of whom he did not but nonetheless influenced him in some way. I call this book "a document" as only a first-hand participant of Sondheim's stature could make his reminiscences a treasure-trove which will be studied by students of Broadway for years to come. We can eagerly await Sondheim's next installment covering the musicals after 1981.

Although as a young man Sondheim struggled to become known as a composer, Finishing The Hat understandably focuses on his lyrics as visiting his music in the same detail would require technical knowledge few of us mere mortals possess. He sets out his mantra for lyrics -- for which he gives attribution to Oscar Hammerstein, his mentor, and Strunk and White's The Elements in Style -- as follows:


1. Content Dictates Form
2. Less is More
3. God is in the Details

As an example of the latter he quotes his lyrics "Losing My Mind" from Follies, one of my many favorite Sondheim pieces, one that is in my own piano repertoire. Funny, I've played this song hundreds of times and never made the connection that as Sondheim puts it, "musically, this was less an homage to, than a theft of, Gershwin's 'The Man I Love,' with near-stenciled rhythms and harmonies" (although the lyrics are more along the lines of Dorothy Fields, a lyricist Sondheim holds in higher esteem than Ira Gershwin). Now I can clearly see the similarities, never noticing them in my many renditions of both songs. But the "God is in the Details" issue is from the last stanza of that song where Sondheim uses the word "To" in the fourth line from the end rather than the more prosaic "And"

"I dim the lights
And think about you,
Spending sleepless nights
To think about you.
You said you loved me,
Or were you just being kind?
Or am I losing my mind?"

Per Sondheim: "...using the word 'to' instead of 'and' ...takes Sally a step further into her obsession with Ben and offers a nice example of the subtle powers of the English language. As I keep saying, God is in the details."

No doubt Sondheim's best work begins when he is both lyricist and composer, finding the perfect marriage of the subtleties of the English language with the progressions and rhythms of music. But before establishing himself as a composer (although he was both lyricist and composer for his rarely performed earliest work, Saturday Night, in 1954), his friend, Oscar Hammerstein, persuaded him first to take on the role of lyricist for West Side Story with the renowned composer, Leonard Bernstein, who according to Sondheim, thought himself "poetic," which set up a continuing battle, Sondheim trying to write lyrics within the characters and Bernstein wanting an unrealistic poetic lyric. Sondheim then was too young and inexperienced and frequently had to accede to Bernstein's demands, something he is still not happy about. I love Sondheim's comments regarding the song "America": "Some lines of this lyric are respectable - sharp and crisp, but some melt in the mouth as gracelessly as peanut butter...."

While things went better when he collaborated with Jule Styne for Gypsy, he felt he was ready to write both the music and lyrics but the show's star, Ethel Merman, insisted on a "name" composer for the show. Nonetheless, Sondheim had respect for Styne, thought he captured the right atmosphere in the music for the show, and undoubtedly learned a trick or two from that collaboration.

His disaster collaboration was with none other than the great Richard Rodgers in the writing of Do I hear a Waltz? in 1964. This came on the heels of "two successful" musicals for which Sondheim wrote both lyrics and music, the commercially successful A Funny Thing Happened on the Way to the Forum in 1962 and the artistically successful (but commercial failure) Anyone Can Whistle in 1964 which, although it closed after only nine performances, was another great learning experience for the young artist, preparing him for greater successes in the future. The title song from Anyone Can Whistle is also one of my own personal favorites and when I play it on the piano I almost feel is if I am practicing a yoga exercise, "It's all so simple: / Relax, let go, let fly. / So someone tell me why / Can't I?" Some, according to Sondheim, thought this particular song was autobiographical, to which Sondheim replies, "To believe [this song] is my credo is to believe that I'm the prototypical Repressed Intellectual and that explains everything about me. Perhaps being tagged with a cliché shouldn't bother me, but it does, and to my chagrin I realize it means that I care more about how I'm perceived than I wish I did. I'd like to think this concern hasn't affected my work, but I wouldn't be surprised if it has." How's that for frankness?

In any case, back to his collaboration with Richard Rodgers, something he took on at the request of the, then, dying Oscar Hammerstein, and as a means to make a "ton of money" after the flop of Anyone Can Whistle. It was, as he admits, an act of self-deception, it made him "feel noble to sublimate my need to write music in order to support his [Hammerstein's] forlornly abandoned partner...Warmed by the personal aspects of the venture and rationalizing the right and left, I agreed to write the lyrics, as wrongheaded a decision as I've ever made." Sondheim found Rodger's creative abilities were failing him and once he wrote music for a piece he refused to alter any of it for the lyrics. It was a spiritless collaboration and as Sondheim says it "was not a bad show, merely a dead one." So with the failure of a work he loved, Anyone Can Whistle, and the failed collaboration of Do I Hear a Waltz, Sondheim began his voyage into a brilliant career as "I learned the only reason to write a show is for love -- just not too much of it."

His musical Company, which is about marriage, or perhaps more aptly, about the potential misery of marriage, is one of my favorites and I have a coincidental personal connection with it as well as it opened on the same day as my second marriage. Also, the main character's name is Robert, and I play most of the music from Company on the piano, with the notable exception of "Getting Married Today" which is technically demanding and is best heard sung. Sondheim points out the irony that all his training under Hammerstein to write an integrated book musical had to be rethought for this show as it is an ensemble production, with the music having to comment on the subject, and not necessarily advancing the plot. Also, it required Sondheim to interpret the intricacies of a subject he had not personally experienced: marriage. He had to interview Richard Rodgers daughter, Mary, to acquire "secondhand experience" on the subject.

What emerged is a brilliant collection of characters and songs, perfect for the subject and the cynical 70s. I was happy to learn that Sondheim's favorite version of the musical is the same one as ours, the 2006 production staring Raul Esparza. All the characters play musical instruments in this production and Esparza as I recall had to learn to play the piano to accompany himself when singing my favorite piece from the show, "Being Alive." The entire show is a remarkable performance which is available on DVD. Again, in a self-effacing mood, Sondheim confesses the following about the show: "Chekhov wrote, 'If you're afraid of loneliness, don't marry.' Luckily, I didn't come across that quote till long after Company had been produced. Chekhov said in seven words what it took George [Furth, the writer of "The Book"] and me two years and two and a half hours to say less profoundly. If I'd read that sentence, I'm not sure we would have dared to write the show, and we might have been denied the exhilarating experience of exploring what he said for ourselves." (Disclaimer: I don't agree with Chekhov!)

In 1971 he followed up Company with another musical with a loose plot, Follies. It is Sondheim's tribute to the subject he loves the most, Broadway history and Follies allowed him "to imitate the reigning composers and lyricists from the era between the World Wars....What made these songwriters imitable was that most of them had a style independent of whatever show they were writing. Just as you can listen to almost any piece by Chopin without ever having heard it before and still know that it's Chopin, so it is with Arlen, or Gershwin, as well as with a lyric by W.S. Gilbert or Harburg or Porter or Hart, at least the lyrics they wrote once they'd found their voices." Follies has that great show-stopper, "I'm Still Here" as well as one of the most cynical pieces ever written on the subject of marriage: "Could I Leave You?"

But so much of the value of Finishing the Hat is Sondheim's observations about his contemporaries. Of course he pays homage to his "unsung collaborators" over the years, people such as Arthur Laurents and George Furth just to name a few, and then there are his accolades and criticisms of the composers and lyricists, and he frequently doesn't hold any punches:

Leonard Bernstein: "taught me by example..[and] there were other musical things that I learned from Lenny by osmosis...Many of the lyrics from West Side Story suffer from a self-conscious effort to be what Lenny deemed 'poetic.'"
Frank Loesser: "A master of conversational lyrics....Most impressive...the ideas behind his songs."
Alan Jay Lerner: "Smooth, appropriate lyrics but merely pleasant...No discernable style or personality." (Although Sondheim acknowledges that My Fair Lady was the most entertaining musical he's ever seen, except his own!)
Oscar Hammerstein II: "An earthy, optimistic lyricist...Sometimes gets carried away by 'pretty' words instead of accurate ones."
E.Y Harburg: "Often preoccupied with linguistic playfulness that is at its best charming and inventive."
Lorenz Hart: His writings were" jaunty but melancholy, forceful but vulnerable..verbally nimble, full of humor, and a lazy craftsman."
Ira Gershwin: "Often undone by his passion for rhyming, for which he sacrifices both case and syntax." Sondheim speculates that his obsession "to invent and dazzle" was an attempt to "bridge the gap" with his genius brother.
Irving Berlin: "Naturally colloquial lyrics that were deceptively simple."
Cole Porter: "Most immediately recognizable lyrics...Technically, in both music and lyrics, no one is better than Porter and few are his equals."
Dorothy Fields: "Leading exponent in her generation of the truly colloquial lyricists...Dorothy needed someone like Kern or Arlen or McHugh -- more openly emotional composers."
Noel Coward. Compares him unfavorably to Porter. Porter's "music is notably more inventive and colorful than Coward's." In their lyrics, "both make sport of the haut monde, but Porter does it with fondness, Coward with disdain."

Those are but a few of Sondheim's "attendant comments..heresies, grudges, whines and anecdotes.". He frequently devotes whole sections to his predecessors and contemporaries in Finishing The Hat and of course there will be others to follow in the succeeding pages. If that in itself is not worth the "price of admission," Finishing The Hat is also a fine example of the art of the book, and why a Kindle cannot replicate the look and feel of good book craftsmanship. It is an oversize format so the lyrics and text can occupy three columns and to accommodate numerous illustrations, musical handwritten scores by Sondheim, lyrics both typed and handwritten and edited with the author's notes, and photographs from the productions of his shows. I was intrigued by his thought process, working out lyrics as shown on facsimiles of his yellow legal pad notes. He even goes into detail regarding his writing habits (in a footnote) about how he bought a life time supply of a special pencil with reversible erasers, ones which are flat and can't roll off a table, as well as a 32 line yellow legal pad ("allowing alternate words to be written above one another without crowding or wasting space"). Sondheim's eye for detail is omniscient.

The book is beautifully designed, printed on a high opacity stock that reminds me of the Warren Patina paper I used in my production days in publishing, when the esthetics of the book were paramount. My one minor criticism of the design is the lyrics are not as easy to read as they are juxtaposed to Sondheim's commentary text which is in bold.

Sondheim ends Finishing The Hat with "Intermission" and likewise, this entry ends on the same note.

She's Quick on the Trigger

With targets not much bigger than the president's deficit commission. I don't think I've ever actually READ anything by Sarah Palin, although I've seen her paraded before TV cameras, so it was with some interest that I noted "her" opinion column in the Wall Street Journal, Why I Support the Ryan Roadmap; Let's not settle for the big-government status quo, which is what the president's deficit commission offers.


I had expected a folksy take on the topic in keeping with her TV persona, perhaps sprinkled with homey references to Alaska wildlife, or more aptly the disappearing wildlife when Sarah Oakley has her high-powered rifle with telescopic sight at her side, but instead was greeted by a more or less professionally written piece of journalism, quite possibly with the help of the people at News Corp which owns the WSJ and also owns Fox which in turn employs Ms. Palin. She or her ghost writer is "disappointed" in the deficit commission's recommendations but commends the commission for exposing "the large and unsustainable deficits that the Obama administration has created through its reckless 'spend now, tax later' policies." I go speechless when reading such an accusation, feeling like Melville's Billy Budd confronting the evil Claggett. Sarah, do you really believe what "you" wrote? Not only are the deficits at least partially shared by your Party (not to mention the National Debt most of which could be pinned on the Bush era), but Congress now has the opportunity to roll back some of the tax forgiveness for the super wealthy, both in terms of incremental tax rates and the inheritance tax, and your Party is stonewalling that prospect. However, pardon my impertinence, "a man never trifles / with gals who carry rifles...Annie Get Your Gun.

Rebels Without a Cause?

It was a "chicken-run" by the Republicans and the Democrats, drag-racing to the edge of the Bush Tax Cliff as the sun was setting, but who really bailed out of the car and who remained will be revealed in two years. In the movie, the adversaries, Jim (played by James Dean) and Buzz, check out the abyss of the cliff before climbing into their cars:

Buzz: This is the edge. That's the end.
Jim: Yeah. It certainly is.
Buzz: You know something? I like you. You know that?
Jim: Why do we do this?
Buzz: You got to do something, now don't you?

And that seems to be the nature of the "deal" between the two parties: "You got to do something, now don't you?" On the surface, President Obama caved in. Someone had to and it was pretty clear the Republicans were prepared to fly off the cliff to preserve the precious Bush tax cuts for "everyone," especially for the wealthiest, the old Razzle Dazzle 'em of trickle-down economics.

We now continue the drag race to the same cliff in two years but this one also includes the Presidential election. If the "compromise" just further expands the deficit without creating meaningful jobs, the Democrats will blame the Republicans who will be left in the car. Of course the American people will be in the passenger's seat. "This is the edge. That's the end."

Dueling Headlines

No sooner after writing the last entry of this same date, these two headlines from AP accosted my in box:

AP Extended unemployment benefits for nearly 2 million Americans begin to run out Wednesday, cutting off a steady stream of income and guaranteeing a dismal holiday season for people already struggling with bills they cannot pay. Unless Congress changes its mind, benefits that had been extended up to 99 weeks will end this month

AP GOP says it'll block bills until tax cuts extended. "While there are other items that might ultimately be worthy of the Senate's attention, we cannot agree to prioritize any matters above the critical issues of funding the government and preventing a job-killing tax hike."

Translation: if the peasants have no bread, let them eat cake! Translation for "job-killing tax hikes" for those in the highest income bracket: trickle-down economics with no basis in fact.

This was exactly my fear after the mid-term elections: If the Republicans and Tea Partiers interpret their gains to mean they now have carte blanche to keep the Bush tax cuts for the highest wealth tier -- people who would not be hurt by some roll back to pre-Bush tax levels -- the result will only increase the deficit further.

More posturing at our country's expense.

Cheery Tidings from the Social Security Administration

For the second year in a row, this happy news from the SSA, received in the mail yesterday: "Your Social Security benefits are protected against inflation. By law, they increase when there is a rise in the cost of living. The government measure changes in the cost of living through the Department of Labor's Consumer Price Index (CPI). The CPI has not risen since the last cost-of-living adjustment was determined in 2008. As a result, your benefits will not increase in 2011."

What a country, retirees are protected from the ravages of inflation, and, better news, yet, there is no inflation! Hooray! There is certainly no inflation in interest rates from CDs, that's well documented. Thank you, The Federal Reserve!

Of course the SSA's Cola adjustments are made through the most bizarre calculation. Sounds like a lot of sleight of hand, but here is an explanation.

It is interesting to review how the CPI gets measured and how such measurements might distort what inflation seniors really face. According to Bureau of Labor Statistics Consumer Price Index the prices of certain items have actually declined over the last year, specifically Window Drapes (8.00%), Peanut Butter (5.10%), Bedroom Furniture (5.00%), Dishes (4.40%), and Sports Equipment (4.00%). But, with the notable exception of Peanut Butter which many seniors may have resorted to consuming, these items are probably not frequently among their purchases. On the other hand, let's look at some of the offsetting increases: Funerals +2.20%, Dental Services +2.80%, Nursing Homes +3.50%, Physicians Services +3.50%, Prescription Drugs +3.90% and Hospital Services +9.30%

No inflation for seniors? Ha. Also, for a quick peek into the future, let's review the past: According to the Bureau of Labor Statistics, the purchasing power of a 1984 dollar is now $.458 while a 1967 dollar is only $ .153.

No doubt entitlement programs need to be looked at along with taxes to get our fiscal house under control, but inflating away the dollar and playing shell games with Social Security is what happens when Congress cannot agree on anything and political posturing is all our representatives seem to be able to do. We've become a sound bite democracy.

Meanwhile, on another, but related topic, the essay du jour is Bill Gross' latest, with his conclusion saying it all: "The United States in short, needs to make things not paper, but that is not likely unless we see a policy revolution in Washington DC. In the meantime, our unemployed will continue to fill out forms and stand in line. We’re living here in Allentown."

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Happy Thanksgiving

A recent email exchange with my friend across the pond, Danny, in which I wished him a Happy Thanksgiving, reminded me that this is a uniquely American holiday (although he reciprocated the wishes with news about his growing family as well as noting the passing of people we both worked with -- we are of that age).

Yesterday's PBS broadcast of the New York Philharmonic's remarkable concert last March honoring Stephen Sondheim's 80th birthday is a joyous, American story. Sondheim has taken musical composition and lyrics to places no one could have imagined. I am grateful that we honor such genius in this country, even though his art is not main stream. Another gift he has given us is his recent book, Finishing the Hat. It is the story of his craft, brilliantly written (along with his lyrics), honestly presented, even self deprecating at times (but not often) along with his take on virtually every great participant in the American musical theatre, and he has known them all. Imagine if Beethoven took the time to explain his craft in his own words, but comprehensible enough for us mere mortals. But as I have not "finished" Finishing the Hat, more on that later.

And, although there is increased polarization in this country, at least we live in one of the few places where we can say what we think. But in the saying comes some responsibility and a friend of mine reminded me of that, criticizing my last entry, pointing out that liberal media, in spite of Fox News and other affiliated media , is still dominant in this country. That might be true, and I apologize to anyone I offend by anything I satirically write. However, exaggeration and sarcasm are the hallmarks of satire so some of what I say is not intended to be interpreted literally. Nonetheless, there are a plethora of views of our political system, and the economic paths we seem to be inexorably following, and thankfully in this country we can express those opinions.

Finally, to friends and family, both near and far, Happy Thanksgiving, my favorite holiday, a uniquely American one.


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All the News That's Feigned to Print

The Rupert Murdoch owned Wall Street Journal reported yesterday that the Rupert Murdoch owned HarperCollins Publishers will sponsor a 10-day book tour by their author, Sara Palin, who is a contributor to the Rupert Murdoch owned Fox News.

The occasion is the publication of her book "America by Heart: Reflections on Family, Faith, and Flag," a follow-up to her best-selling "Going Rogue." In addition to those credentials for her inevitable run for the Presidency, Ms. Palin is also the star of her own reality TV show, "Sarah Palin's Alaska." Her daughter Bristol is indirectly campaigning by her appearance on "Dancing With the Stars," another prime time "reality" media production.

In addition to those qualifications, Ms. Palin has a bachelor's degree in communications, having attended a number of colleges in the pursuit of that degree, was a TV newscaster, and served as a mayor of a town of some five thousand people and for a couple of years as governor of Alaska with a population about the size of El Paso, Texas. She resigned her governorship to pursue her interests in self-promotion.

Besides having Rupert Murdoch's News Corp empire as a backer, she owes her political career to John McCain who brought her to the national stage in a desperate act to carry the 2008 presidential election.

Can this "rogue" politician continue to skillfully manipulate public opinion by charisma alone and a friend in high places? And will she continue to supply News Corp with all the fodder necessary for higher ratings, greater circulation and therefore more advertising and sales? A nice symbiotic partnership? You Betcha'

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Get Over Your Junk

Get over it already! Having an implanted medical device for almost twenty years and having flown frequently both domestically and internationally during that period, I've had more pat downs than Tiger has had lap dances. Furthermore, having endured the indignity of backless hospital gowns and medical procedures on a number of occasions, my being naked on a faceless image of a body scan sure beats being blown to smithereens at 30,000 feet.

Amazing, this "outcry" against thorough airport screenings is exactly the kind of disruption terrorists want and the American public is buying right into it. Instead of just going through this in an orderly way to expedite the process, we conjure up images of our constitutional rights being violated. It will take only one tragic incident in the air to silence these critics, something they are inviting by their protests.

Do I think these rigid guidelines are the answer to combating terrorism in the skies? No, but they are part of a solution, and an easy one if everyone simply cooperates. Ten seconds in a body scanner is not too much to ask. Your "junk" is not so sacred. Stay home and never go to a hospital if you think it is.

What Happened and What Will the Future Bring?

The question relates to the midterm elections and the answer comes via the oblique route of my 50th high school reunion. In the summer I was invited to the reunion but unfortunately I would not be able to attend.

My "old" classmate, Eileen, who did a yeoman's job organizing the reunion was disappointed (as was I), but told me that our grade advisor from those by-gone years, Mr. Brickner would be there. I was delighted to hear his name again and to learn he was well. She said she would be meeting with him to finalize plans and she was still having difficulty addressing him as "Roger" rather than Mr. Brickner. I know what she meant. Our class had tremendous respect for Roger Brickner. And, for me, he was not only my advisor, but an important mentor (probably unknown to him). My first three years in high school were mostly wasted opportunities, but when I had Mr. Brickner for Honor Economics, all that changed. I wrote to Eileen that “he is one of the few teachers I so clearly remember as being encouraging of my dormant academic abilities and I would love to be able to be in touch with him to thank him.”

Ellen passed on the information and one day I received a phone call. It was Mr. Brickner, animated and enthusiastic, exactly as I remembered him from fifty years ago. I had the opportunity to personally thank him for being such a supportive teacher and asked him whether he still wore his trademark bow tie (no). We exchanged email addresses.

Suddenly I began to receive broadcast emails from him about the, then, upcoming midterm elections, detailed analyses covering the house, senate, and gubernatorial races, state by state, projecting winners and the reasons why. I was stunned by the scope of his knowledge and asked whether he worked professionally in this area after teaching. He wrote back, "My interest in politics is an enthusiastic avocation. I began to predict presidential elections as a teenager and since I thought Dewey would win in 1948 I have been lucky to pick every winner since that time. The key is understanding where the American people are each fall of a presidential year." Now I understood why he was the champion of mock political conventions in our high school. I participated in the one for 1960 and as I recall placed Margaret Chase Smith, the Senator from Maine, in nomination for the Presidency, which put me way ahead of the times (imagine, a woman President!).

His predictions were remarkably accurate, nailing almost all the races, and reading his forecasts was a better use of time than watching the network "calls" of the election. As the projections of all the major networks -- ABC, CBS, CNN, FOX, and NBC -- rely on the same exit poll information gathered by National Election Pool (NEP), their calls and analysis can be dully redundant. It was a breath of fresh air to read Roger's coverage and projections, all well before the exit polls gathered by NEP were distributed to the networks. After the election he sent a daily email dissecting the house, senate, and gubernatorial results. On November 9 he did an omnibus summary, musing about the possibilities for 2012, which I publish in its entirety as a valuable guest entry:

WHAT HAPPENED AND WHAT WILL THE FUTURE BRING?

Dear Friends:

First and foremost, the election just concluded (with still a few undecided races) WAS truly a remarkable one. It tore down past records. The Republicans now have more state legislators than they have had since 1928. They have seized control of the House to a greater extent than they have had since 1946. Hardly a record, they added six seats in the Senate, remaining behind by a 53-47 margin. In number of governors they are very close to their all time highs of the 1970's and 1980's.

What caused this surge to the Republicans? The public never accepted the assurances of the President and the Congressional leaders that the Medical Care measure was in their interests. They were appalled by the dealings in congress and the twisting of arms. Standard behavior in Congress, but not appreciated by the public. But if the Medical Care bill hurt, it was the inability of the Administration to lower significantly unemployment. There also was the feeling that nothing was being done to limit the power and the machinations of Wall Street and Big Business. Not spoken about in the campaign I believe it was an underlying factor. It not only united the left with the populist tea party right, but it activated the latter while depressing the former.

The president himself was a substantial factor. Not that he did not achieve Congressional measures he fought for, but that he seemed not to be able to communicate to the public easily. He was viewed as being "an educated elitist" who was not comfortable with ordinary people. A bit like Adlai Stevenson.

Losses in key areas were devastating. He lost 21% of the over 65 voters, who voted in a greater proportion than in 2008. On the other end the under 30's held in their support BUT far fewer got out to vote. White men, white women, less educated all shifted strongly to the Republicans. Blacks remained loyal to the Dems. Their proportion of the vote dropped however.

The tea party played a role in the 2010 election... it helped both the Republicans and the Democrats and it hurt both as well.. It is a dynamic loosely knit group of individuals motivated by a desire to change the way government has been going of late. It is quite the populist movement, hardly a sophisticated bloc of traditional activists tightly organized. It has had the effect of bringing out voters. It has encouraged participation of voters, particularly in Republican primaries, challenging both Conservative and Moderate party standards. In three cases it achieved the nomination of tea party types in areas where the general electorate not inclined to support them. They undoubtedly caused the Repubs. Senate seats in Delaware, Colorado and Nevada. Had the standard candidates run in these states the Senate would be 50-50. If Lieberman ( I-CT) or very conservative Ben Nelson ( D-NE) had switched to vote to organize for the Republicans it would be a different story. Tea party has surely hurt the Repubs. in these three states. The Dems. can see this as a ray of hope for them. However, the Republicans undoubtedly were invigorated by the support of many in the tea party. Perhaps now that they have a half dozen tea party Senators and perhaps 40-50 House members they will understand the process of politics more than their exuberant backers. Indeed, I see this Repub. bloc as I did the Blue Dog Dems in the last Congress. Many of the Blue Dogs lost as readers of these letters expected. Many of the tea party winners come from these Blue Dog CDs.

The tea party may become involved in the populist cause of punishing the greed on Wall Street and be joined by the left wing pseudo socialists in the President's party. Perhaps this unlikely coalition will be an interesting development of tea party influence. Keep watch for this.

As the lame duck Congress meets later this month, I shall return to the issues and the wisdom of how much a lame duck Congress should attempt especially after a watershed election.

What is in this election to help us understand the 2012 election? History tells us that presidents bounce back after major defeats in Congress after their first two years... TRUMAN, EISENHOWER, REAGAN, CLINTON. All were two term presidents (Truman less only 80+ days). Does this apply to Obama?? History says it may well. But, just to play the game of IF THE PRESIDENTIAL ELECTION WERE HELD TODAY WOULD YOU VOTE FOR OBAMA OR FOR ROMNEY? My guess is that would be an extremely close election with perhaps 1% separating the two. Electoral vote? Obama 271, Romney 267. that would see Obama losing four major states VA, NC, FL, OH. It would be a nail biting election. BUT the election is NOT now, it is in NOV 2012.

A POSSIBILITY for 2012 is for third party(s) may become significant. It would really shake things up. A centrist party a la Bloomberg or a frustrated Tea Party on the right could mess up anyone getting a majority of the electoral votes. If that happened then the House votes by delegation for one of the top 3 candidates popular vote. If that were to happen in 2012, the Repubs. would make the decision for they are in control of 33 state delegations and only 26 votes are needed. So given that reality, it would seem a Tea party third party is the more likely. A centrist party would have to win a majority of the votes for it to win, and if it ran and did not, the Repubs. would again be able to vote themselves in. THIS IS ALL CONSTITUTIONAL OK??

Time to take a break, Roger

Veterans Day Thoughts

On this Veterans Day I take a moment to remember my father who fought in WW II. He was a Signal Corps photographer, and although that doesn't sound very dangerous, he had his share of close calls, fears, and uncertainties. He did things he never imagined he'd be asked to do or see, such as having to film a German concentration camp as soon as it was liberated witnessing first-hand those demonic atrocities. Or having to go up in gliders to silently land near enemy lines, and, generally, having to be away from his wife (Penny) and young son (me). He rarely talked about those war years, preferring to just put that part of his life into a compartment, locking it and throwing away the key.

My father had some notoriety, appearing on the pages of Stars and Stripes, the venerable newspaper of the armed forces that has been published since the Civil War. My father was filming at enemy lines overlooking the Rhine River, under a German sign reading "Photography Forbidden."

Now that he is long gone I regret not trying to talk to him more about the experience. I have some of his letters that he wrote to my mother and my Uncle and below I quote one of my favorite passages as it is so revealing. Towards the end of the War he wanted to get home so badly. Who could blame him? I'm sure all Veterans, current and past share those feelings.

Here are my father’s hopes and thoughts on Aug. 12, 1945, in a letter to his brother, Phil, from Wiesbaden, Germany:

“As you no doubt already know, I informed my sweetheart [Penny] some very discouraging news – that is being stuck here as [part of the] occupational [force]. On the heels of that letter came the wonderful news that Japan is asking for surrender. As this wasn’t definite as yet, I can’t say that finally war is ended, but I’m sure it’s only a matter of a day or two.

The Atomic bombings, and Russia’s entry into the conflict just overwhelmed the Japanese, especially the Atom smasher, a deadly and destructive thing, which has great future development for the betterment of mankind, but what I fear is some nation to use it for a complete destruction of civilization. I hope that this fear never will materialize.

What I began to say concerning the news [staying here as part of the occupational force], which I hated to tell Penny, is this – the sudden ending of all hostilities can possibly bring me and hundreds of other guys back to homes sooner than is predicted. I’m sure that those who are the law makers at home aren’t going to leave us in these foreign lands against our will – especially as there are millions of other Joes who have never left the good old USA and faced a future of sudden death.

I fought for freedom, freedom for all peoples. Now that we have won victory over the oppressors, haven’t I the right to enjoy that freedom? The Army is composed of civilians. Is it not the democratic way that we all share the fruits of victory, especially those who fought for it and were fortunate enough to be sparred a hideous death?"

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A Taxing Question

How rich is too rich? Actually, I published a book by that title almost twenty years ago and some of its ideas are as relevant today as it was then (How Rich Is Too Rich; Income and Wealth in America by Herbert Inhaber and Sidney Carroll: Praeger, 1992). Two points from that book stuck with me. First, there is the very descriptive opening chapter of looking at income distribution as an imaginary "sixty minute grand parade," tax payers being the marchers, grouped by their height which would be representative of their incomes, the first marchers having the lowest income and the last the highest, with "height" determined by the "average" taxable income being equal to the "average" height of an individual American. The "parade" in effect is an X/Y graph, the Y axis being the income (height), and the X axis being the minutes of the "parade." The first few minutes one sees no marchers even though we can hear some noise. These are people with negative height, those who report the loss of money in that taxable year. It isn't until about ten minutes into the parade that we see marchers between 10 and 24 inches in height and it isn't until 36 minutes we see the so called "average height" taxpayer march by. With about only 20 minutes left, heights begin to rise dramatically. With the last five minutes giants appear, people whose heads are so high we can hardly make out their faces without binoculars. The marchers in the very last minute of the parade are so tall we can only see their feet. These are people of accumulated, sometimes inherited, wealth and in the last few seconds the marchers are the size of sky scrapers. In effect, the parade shows a slowly rising gradient until the far right of the curve when it begins a parabolic rise and then shoots straight up off the graph.

While the numbers might have changed over the last twenty years, the concept has not. Probably, if anything, the "parade" has become even more dramatic, more parabolic, with a steeper rise at the end. And, those at the end of the parade pay now less as a percentage of their income to the government than at any time before.

To listen to the Tea Partiers, a roll back of taxes of the very wealthiest to pre-Bush rates, is an evil, evil thing. Just think of the trickle-down effect that would be lost to the little folk who stand in line for the crumbs falling from the tables of the fabulously wealthy. It is ironic that these dire warnings of the effects of a tax increase on the wealthy are carried into battle on banners hoisted by "Joe the Plumbers" -- it shows the power of the conservative media and the most virulent impact of the Internet. It just makes no sense that the people near the middle of the parade should become pawns for the people at the very end.

Actually, I think the converse is true: it is an evil thing for people who have benefitted from being able to accumulate wealth in the greatest of all capitalist democracies, not to give back more for that opportunity. The argument goes that asking these people to pay more will remove the incentive for them to work, and maybe if we're talking about 70 percent of one's income that might be true. But in 2000, people reporting AGIs of more than $1 million paid 28% of their income as taxes vs. 23% five years later. In 2005 there were 304,000 households reporting income of more than $1 million, more than a trillion dollars of income or $3.375 million per household. And mind you of those, there are a few at the very end of the "parade" with incomes that have so many zeros they would be hard to read. The latter are sports stars, entertainers, and, of course, very, very successful entrepreneurs. Are they going to work "less hard" by paying an additional five percent overall? That five percent would mean another $50 billion going to the US Treasury, at least a beginning to address the ongoing deficit. And, of course, if you look at the $250,00 level as the cut off as suggested by President Obama, there is much more to be gleaned, but given the midterm elections, that level is probably going to be raised if it is not eliminated altogether.

The alternatives that are occasionally pushed by the Tea crowd, such as a flat tax, is, in effect, a regressive tax, with the lower income people having to pay the same taxes on necessities as the wealthy, which just further splits the great economic divide in this country. A national sales tax does the same thing and as we are now so dependent on consumer spending, that could be the death knell for the economy. No, a progressive tax structure has been this country's basis for supporting it's national programs and we have been able to grow in spite of these supposed "disincentives" of higher taxes at a higher bracket.

No doubt the current tax structure is hopelessly and needlessly complicated and THAT is where the discussion should also be focused. There are so many loopholes, that a revised graduated tax structure would not have much teeth without addressing those as well. And then there is the issue of capital gains and dividends. We certainly want to encourage taxpayers to reinvest in our equity markets.

The other point I never forgot from that book was its commentary on the estate tax, arguing against the estate tax altogether, provided there was an alternative system of "estate dispersion." Rather than taxing one's estate at death, it suggested a tax-free dispersement up to a certain level per recipient (rather than per estate). For argument's sake, call that $1 million per recipient. Amounts exceeding that would begin to be taxed on some kind of graduated basis. Those would be life time totals, so if an individual receives money from different inheritances, they would be accumulated and taxed on that scale. "No longer would the estate tax system generate an American royalty -- those freed from the need ever to be economically productive. This alternative system would generate for all the incentive that most of us have in the outcome of our own economic lives. No longer would a large part of our national wealth be beyond responsive use."

Now, the incredibly wealthy could give a million dollars each to a thousand different people, all tax free (if those recipients also received no other inheritances in their lifetimes). The point is that those thousand people would put that capital to work, rather than vesting a billion dollars in one's immediate family who might decide to simply live off the income and pass it on to the next generation, and the next. Or he/she could still leave more to the immediate family, but it would be subject to taxation, perhaps substantial taxation on a graduated basis.

"Wealth great enough to entitle one to membership in the elite comes from two sources -- enormous earnings or inheritance. Prudent public policy should allow those, who, through individual ingenuity, talent, or luck, gain a fortune to use and enjoy it for life...but if these individuals have the power to transmit immense wealth to others after death...they can write the rules controlling this wealth, possibly many generations into the future. This breaks the chain of personal effort that is tightly bound, for most of us, to personal reward. Economic resources, controlled by rules set up by the dead, are denied to those who might well be more productive."

If the Republicans and Tea Partiers interpret their gains to mean they now have carte blanche to keep the Bush tax cuts for the highest wealth tier -- people who would not be hurt by some roll back to pre-Bush tax levels -- the result will only increase the deficit further. There would seem to be no upside to such an action; in effect it is a spending initiative something they claim to condemn. Failure to make tax reforms that lead to a more graduated income tax and closing loopholes, and not having a sensible inheritance tax also just further drives a stake between the haves and the have-nots.

On a related subject, the so called "wealth effect" the Federal Reserve is trying to engineer with its QE2, is still another factor favoring the haves. This is convincingly analyzed by my fellow blogger over at Fund My Mutual Fund in his posting Who Will Any Form of Intermediate Term Wealth Effect Really Help? Not the Masses. It is well worth reading.

A tranquil reprive from QE2 and the upcoming taxation battle in Congress

The Widow Maker

There is a fine line writing this blog, expressing my views on a number of subjects, but sometimes struggling about how much personal information I am willing to reveal, and this entry is one of those, somewhat crossing the line to recount a recent health issue as a "public service" piece.

I remember when Forbes' Wealthiest 400 List was first published, noting that among the foremost "professions" that led to wealth was "inheritance." I made a mental note to make that my college major in my next lifetime. Being born into such a family such as DuPont or Rockefeller made succeeding generations instant lottery winners!

Here's the connection to the topic at hand: The reverse lottery is being born into a family that has a history of coronary heart disease. Eating a reasonably healthy diet and exercising might delay or mitigate the effects of being dealt poor genetic cards, but last week I found that no matter what I do, I am going to battle this disease for the rest of my life. That is the depressing part of the problem. I have always approached life with the thought I can do something about affecting the outcome. Well, I have no direct control over the progression of coronary heart disease; both my parents suffered from it, in one form or another.

Now other people have been dealt much worse hands on matters of health and cancer has to be among the most cruel and frightening. Coronary heart disease, however, is stealth like and a bigger killer. It develops over years and years. No doubt I compounded my genetic problem as a young adult, smoking by my late teens into my early 30's. My parents both smoked and the rooms of our home sometimes looked like they were in a fog. Also as I kid I ate foods like Wonder Bread ("builds strong bodies 8 ways!") and drank massive amounts of whole milk (which I did into my college years). Meat was also a staple "health" food, and Coca-Cola at 5 cents a bottle was consumed like water.

Over the past summer I noticed that I was having difficulty climbing steep hills during my morning power walks, with a noticeable tightness in my chest. So until we returned home to Florida, I just avoided hills. That was stupid. I should have seen someone immediately, but I didn't think much of it and I was fine otherwise. Once I returned, my Doctor did not like anything I reported, and he said let's skip the usual stress test and go directly to a radial catheterization. Going through the wrist is a newer technique, with faster recovery for the patient. So I went into our local hospital which has an excellent catheterization unit on Monday last week, made a mental note of the time I was wheeled into the cath lab and found myself in recovery less than a half hour later. I then knew there was something wrong. Even if they did merely a balloon angioplasty it would have taken longer than that.

When the Doctor showed up in recovery, he explained I had a 99% blockage in the "Widow Maker" an apt name for the left anterior descending artery which usually gives little warning of being blocked and most who have a heart attack because of that particular blockage die then and there. This blockage could not be addressed with drugs and most interventionist cardiologists would simply refer me to surgery for bypass surgery, an invasive procedure, painful, and with some real risks.

He suggested another option, inserting two drug eluding "kissing" stents where the arteries form a "V." He said it would be tricky, but given my age it might be a better option than a bypass we might have to do all over again in ten years. One bypass per lifetime is enough.

So the next day I was prepped early for a femoral procedure and at 8.00 am was back in the cath lab saying hello to the same technicians and nurses again (we're on a first name basis). I didn't get out until after 10.00 so I knew it was a complicated procedure, but awaited the word from my Doctor about how it went. He explained I received three new drug eluding stents, two in the left anterior descending artery and a kissing one in the diagonal. That makes six total stents in my system and I am now known as a catheterization lab "frequent flyer."

It's been quite an experience. As I said, not half as bad as many people have to go through with their health issues, but bad enough. The message: listen to your body and know your family history.

I am hopeful that I can continue to successfully manage this, but that hope is sort of dependent on being reasonably tethered to my cardiologist and cath lab. In that regard, Dr. Paul Teirstein of Scripps Clinic wrote a reassuring editorial, "Drug-Eluting Stent Restenosis. An Uncommon Yet Pervasive Problem", published online June 21, 2010 in Circulation. His advice for physicians:

Do not underestimate the emotional impact of repeated procedures on patients, particularly the “frequent flyers” who have experienced multiple visits to the catheterization laboratory. These patients often describe significant frustration and fear. They feel a loss of control, mostly due to an inability to plan their lives and predict when a restenosis will occur. It is helpful to reassure these patients by emphasizing they do not have an incurable, lethal disease.... Patients can be told if they stay in close contact with their cardiologist, the risk of death and infarction is low.... It may sound obvious to the physician, but most of our patients are seeking this kind of reassurance.... I also emphasize that recurrences are unlikely to go on forever. Finally, it is worth communicating that they are not the only patient to encounter this problem, and ultimately, patients with restenosis who seek treatment usually have good outcomes.

Take Tea and See

The electorate has spoken and so has the Federal Reserve. The Party of No will now be in a position to speak words of more than that one syllable.

Meanwhile, Mr. Bernanke's monetary gift to the markets of quantitative easing is propelling them to new highs, especially assets benefitting from a weak dollar. Like sheep investors are being herded into a pen of commodities, export-focused stocks, and corporate bonds, anything but prosaic government bonds and CDs. QE2 is to stem deflationary forces and to stimulate the economy but the Fed is entering uncharted waters with its actions and will it create jobs? Beware of Federal Reserve economists bearing gifts to stimulate inflation and then be careful of getting more than what we wish for. The markets might party while Bernanke plays out QE2, and maybe even QE3, but what is the end game and don't markets ultimately discount what IT perceives as the end? I refer again to John Hussman's important observations on the subject

As to the election, the results were no surprise. I remember being "amused" by the rhetoric heard immediately after Obama's victory into his first few months in office, the Dow dropping almost two thousand points in that short period of time as being "evidence" of his "dangerous" economic agenda. It was immaterial that the markets had already been in a swoon for a year before by even a greater percentage. As the Dow recovered, up more than four thousand points since the "Obama low" not a peep about his policies being responsible.

Of course, neither the decline shortly after his taking power, or the Dow turnaround have much to do with his policies. The Federal Reserve can take responsibility for markets on steroids. A year ago I said "I still think the President could have devoted more of his first year to policies addressing what I called a 'new economic morality.' But Main Street seems to have been sacrificed at the altar of Wall Street and we are angry. Who truly believes the economic crisis is solved rather than being merely postponed?" That anger has spilled over into the midterm elections and, now, we will have the help of the Party of No -- and, who knows, perhaps they will have something positive to say and do. Time to take some tea and see?



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Telling It the Way It Is

You have to admire Bill Gross, the eponymous bond king who runs PIMCO's portfolio. His latest monthly Investment Outlook in part takes on the silly season of the midterm elections and its outrageous campaign tactics. The election nearly neatly coincides with Halloween and the ghoulish nightmare of the endless direct mailings and automated phone calls insult the intelligence of the American voter. The negativity is overwhelming. Being on the National Do Not Call list is irrelevant as apparently the people who make the laws can easily bend them for their own benefit so night after night negative recorded messages besiege our land line. If you do not answer, the recording ends up on your answering machine -- some of them can last minutes. When we're home, call recognition winnows most so we can easily answer and hang up almost simultaneously.

The mailbox is stuffed with dire warnings, black and white photos of the opponent which makes he/she look like a ghost and then a nice colorful photo of whomever the mailing supports. Fill in any politician's name you want "[Blank] Is Sucking the Life Out of the Economy." Or another one we received today: "[Blank] Has a Secret She Doesn't Want You to Know." Some are sent by a major party while others are sponsored by "organizations" that sound mighty impressive but are totally unknown such as "Citizens for Lower Taxes and a Stronger Economy, Inc." Hey, I want a stronger economy and lower taxes -- I should be for what they're for!

But I say elect Spiderman!

Just imagine a political system with campaigning that relies totally on televised public debates and published position papers (on the Web, in newspapers) but NO PAID ADVERTISEMENTS or CALLS. Imagine saving all those wasted resources and putting them to better use, especially in these dire economic times.

I'm sick of it and so is Bill Gross. As I said, you have to admire his stance, a risk he takes as he is not a politician, but represents a major financial institution. He's also a damn good writer. Good riddance to the midterm elections. When will we ever learn? The link to Gross' article is above, but I conclude by quoting part of his statement on the subject. It's just too good to be buried in the link.

Each party’s campaign tactics remind me of airport terminals pre-9/11 when solicitors only yards apart would compete for the attention and dollars of travelers. “Save the Whales,” one would demand, while the other would pose as its evil twin – “Eat Whale Blubber,” the makeshift sign would read. It didn’t matter which slogan grabbed you, the end of the day’s results always produced a pot of money for them and the whales were neither saved nor eaten. American politics resemble an airline terminal with a huckster’s bowl waiting to be filled every two years.

And the paramount problem is not that we contribute so willingly or even so cluelessly, but that there are only two bowls to choose from. Thomas Friedman, the respected author of The World Is Flat, and a weekly New York Times Op-Ed author, recently suggested “ripping open this two-party duopoly and having it challenged by a serious third party” unencumbered by special interest megabucks. “We basically have two bankrupt parties, bankrupting the country,” was the explicit sentiment of his article, and I couldn’t agree more – whales or no whales. Was it relevant in 2004 that John Kerry was or was not an admirable “swift boat” commander? Will the absence of a mosque within several hundred yards of Ground Zero solve our deficit crisis? Is Christine O’Donnell really a witch? Did Meg Whitman employ an illegal maid? Who cares! We are being conned, folks; Democrats and Republicans alike. What have you really heard from either party that addresses America’s future instead of its prurient overnight fascination with scandal? Shame on them and of course, shame on us. We’re getting what we deserve. Vote NO in November – no to both parties. Vote NO to a two-party system that trades promises for dollars and hope for power, and leaves the American people high and dry.

Tale of Two Economists

In an ironic twist, an economist turned entrepreneur writes a rigidly academic critique, The Recklessness of Quantitative Easing, and an academic pens an anecdotal piece of writing on a different but related subject, I Can Afford Higher Taxes. But They’ll Make Me Work Less.

Recklessness by John Hussman, whom I’ve quoted before in this blog as I consider him to be one of the clearer thinkers about the uncharted territory we call today’s economy, argues that the Federal Reserve’s announced intention to pursue a second round of QE is to drive “interest rates to negative levels in hopes of stimulating loan demand and discouraging saving” and to “increase the supply of lendable reserves in the banking system.” But will this increase output and employment?

Hussman thinks not as “interest rates are already low enough that variations in their level are not the primary drivers of loan demand.” There is simply a lack of confidence – both for the consumer and businesses -- that they will have the income in the future to pay off loans. So low or even negative interest rates is not a barrier and “removing a barrier allows you to move forward only if that particular barrier is the one that is holding you back (the economic term being "constrained optimization" as he explains.)

“Instead, businesses and consumers now see their debt burdens as too high in relation to their prospective income. The result is a continuing effort to deleverage, in order to improve their long-term financial stability. This is rational behavior. Does the Fed actually believe that the act of reducing interest rates from already low levels, or driving real interest rates to negative levels, will provoke consumers and businesses from acting in their best interests to improve their balance sheets?”

The effect of all the talk about QE2 has been to propel gold to new highs and to further erode the value of the US dollar as the Fed dramatically expands its balance sheet. “But once the Fed has quadrupled or quintupled the U.S. monetary base from its level of three years ago, how will it reverse its position?” Hussman’s answer is that many years down the road it will be forced to sell off the instruments it is buying, driving interest rates much higher as foreign buyers might be absent from such auctions, and undermining whatever recovery might have begun of its own accord, just further accentuating the boom bust cycle.

He has constructive suggestions, fiscal responses that might include “extending unemployment benefits, ensuring multi-year predictability of tax policy, expanding productive forms of spending such as public infrastructure, supporting public research activity through mechanisms such as the National Institute of Health, increasing administrative efforts to restructure debt through writedowns and debt-equity swaps, abandoning policies that protect reckless lenders from taking losses, and expanding incentives and tax credits for private capital investment, research and development.” Of course many of these require the cooperation of Congress and watching the mud slinging of the mid term elections, one has to wonder.

But Hussman’s article is must reading it its entirety, especially if you are an individual investor and wondering how to position a portfolio in this strange new economic world. The net effect of the Fed’s actions, besides the obvious nearly zero return on any CD you might buy, is to “force” the investor to move into riskier assets commodities in particular and equities as well. One could also “play” the decline of the dollar by investing overseas or in US multinational companies, which derive a majority of their income abroad. But to what extent QE2 is already baked into the prices of these riskier assets is anyone’s guess. There is also the possibility of a more protracted deflationary period than anyone can imagine right now, with the ongoing real estate crisis and high unemployment having a continuing impact. There seems to be a heavy reliance on the Fed’s future actions leading to an idyllic outcome. I think Hussman would disagree.

One of his suggestions as noted is “ensuring multi-year predictability of tax policy” which leads me to the other economist, Professor Mankiw who is professor of economics at Harvard and was an adviser to President George W. Bush, whose administration has to share some if not a majority of the responsibility of our present economic morass.

Professor Mankiw op-ed piece in the October 9th New York Times, through a convoluted and highly subjective mathematical exercise, argues the proposed tax increase on the 2% wealthiest Americans – some attempt at least to close the budget abyss -- will lead to such people not working much, including, alas, movie and rock stars and even novelists! Outraged, and disappointed that I might not see another Harrison Ford movie, or see my first Lady Gaga “concert” or that Jonathan Franzen will put down his pen, denying us his next novel in protest, I immediately shot off a letter to the editor of the NY Times business section, in which Mankiw’s article appeared. Some very good letters were published in response, but not mine. The nice thing about a blog is I can publish my own rejections! So here is what I wrote:

While it is hard to argue with Professor Mankiw’s math (“I Can Afford Higher Taxes. But They’ll Make Me Work Less”) of what his incremental income might become thirty years in the future in a halcyon tax-free world, his conclusion that movie stars, novelists, rock stars, and surgeons might work less if taxes are increased is based more on his own anecdotal view of working. By his own admission: “I don’t aspire for much more than a typical upper-middle-class lifestyle,” and that’s fine, but don’t blame the tax code for declining his next free lance opportunity. If he should climb down from his Ivy tower and look at the real world with real unemployment around 15%, people trying to work to simply support their families and hold onto their homes rather than handing down wealth to succeeding generations, he might have a little more empathy for a progressive tax code that did not seem to destroy incentives during the Clinton years, the last years in which our country actually had a surplus. And even Warren Buffett and Bill Gates see the fairness in having some sort of an inheritance tax.

Maybe the Times found it too preachy or politically oriented. Perhaps I should have concentrated on the nature of work itself. Remember Hussman’s comment about constrained optimization, that removing a particular barrier only has a beneficial impact if indeed it was that particular barrier holding you back? If Mankiw is entitled to personalize his argument, so can I. I worked as hard when in a higher incremental tax bracket as I did when they were lowered. Why? I loved work, simple as that. And, that is what is missing not only from Mankiw’s formula but how our society looks at work and values workers.

I remember my first visit on business to Japan in the 1970’s, the taxi cab drivers waiting at the hotel for a fare, their cabs gleaming as between fares they would polish and clean their cars. The refuse collector doing his job well was as highly valued by society as a company executive. Japan today, of course, suffers some of the same maladies as ours, with a twenty-year head start on the phenomenon of deflation, so perhaps that has taken its toll on their workers. Somehow, as a society, we need to value all workers and restore work as something to be embraced.

Of course we don’t always have an idyllic choice of the work we do in our lifetimes, but we do have a choice of doing it well or not and by choosing the former, we open a path to finding it meaningful. I’m sorry Prof. Mankiw chooses whether he will write an article or accept an invitation for a speech merely based on what his incremental income bracket might be, although I think most people would envy that he actually has a choice.

I like what the great short story writer, Raymond Carver, wrote thinking about a friend who admitted he wrote something just to make a deadline and make a buck, knowing he could have written something better if he took the time. “If writing can’t be made as good as it is within us to make it, then why do it? In the end, the satisfaction of having done our best, and the proof of that labor, is the one thing we can take into the grave. I wanted to say to my friend, for heaven’s sake go do something else. There have to be easier and maybe more honest ways to try and earn a living. Or else just do it to the best of your abilities, your talents, and then don’t justify or make excuses. Don’t complain, don’t explain."

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Cruise to Canada and New England

Although we lived in the northeast all of our adult lives before moving to Florida, and still spend the summers there on our boat, we had never taken our own boat north of Nantucket, so this summer we planned a trip to the Canadian Maritimes, but on a cruise ship, leaving the driving to someone else. And although we had navigated New York harbor on our own boat, there is nothing like leaving New York on a 93,000 ton vessel, where you pass Lady Liberty at eye level and

the entire panorama of New York slowly unwinds as you leave the pier at 55th Street and 12th Avenue and make your way towards and under the Verrazano Bridge, barely clearing the bridge in such a vessel. Passing Ellis Island stirred stories in my memory of my ancestors who were processed there, arriving from Cologne, Germany before the Civil War and afterwards building a photography business on the Bowery in lower Manhattan.

Having departed NY in the late afternoon, we emerged into the open waters of the Atlantic on way to the first port of our itinerary, Halifax NS. Our departure coincided with the arrival of Hurricane Igor in the Atlantic and although we were no closer at any time than about 1,000 miles, the storm stirred up the seas, resulting in considerable swelling. But for old salts such as ourselves, the 8 to 10 foot seas were very tolerable, particularly in such a large stabilized vessel. I felt sorry for the passengers who were wearing their wristbands and their patches behind their ears to ward off mal de mare, real or imagined. One could easily recognize such people from a slight glaze of fear in their eyes.

This first leg to Halifax took a full day and night from NY and we entered the harbor early in the morning, a special moment for me as several years ago I edited a book, New York to Boston; Travels in the 1840’s, which included selections from Charles Dickens’ American Notes (1842). Halifax was Dickens’ first stop after transiting the Atlantic Ocean on one of the early steamers -- and in January no less. One can understand his relief at arriving in Halifax, writing the following about his Atlantic journey: “Imagine the wind howling, the sea roaring, the rain beating: all in furious array against her. Picture the sky both dark and wild, and the clouds, in fearful sympathy with the waves, making another ocean in the air. Add to all this, the clattering on deck and down below; the tread of hurried feet; the loud hoarse shouts of seamen; the gurgling in and out of water through the scuppers; with, every now and then, the striking of a heavy sea upon the planks above, with the deep, dead, heavy sound of thunder heard within a vault.”

His ship went aground entering the Halifax Harbor and after being reassured that there was no danger of the ship sinking, or rolling over as the tide was on the rise, Dickens went to bed at 3:00 AM. Upon awakening the next morning, he wrote: “When I had left it over-night, it was dark, foggy, and damp, and there were bleak hills all round us. Now, we were gliding down a smooth, broad stream …the sun shining as on a brilliant April day in England; the land stretched out on either side, streaked with light patches of snow; white wooden houses; people at their doors; telegraphs working; flags hoisted; wharfs appearing; ships; quays crowded with people; distant noises; shouts; men and boys running down steep places towards the pier: all more bright and gay and fresh to our unused eyes than words can paint them.” They finally got off the ship for the first time in fifteen days, Dickens describing Halifax as follows: “I carried away with me a most pleasant impression of the town and its inhabitants, and have preserved it to this hour… The town is built on the side of a hill, the highest point being commanded by a strong fortress, not yet quite finished. Several streets of good breadth and appearance extend from its summit to the water-side, and are intersected by cross streets running parallel with the river…. The day was uncommonly fine; the air bracing and healthful; the whole aspect of the town cheerful, thriving, and industrious.”

I include Dickens description as remarkably it mirrors our own impression of Halifax, and I could not help thinking of his visit while there. Of course, things are more modern now, and the fort he referred to as being unfinished, The Citadel, was completed in 1856, fourteen years after Dickens’ visit.

It was a clear chilly day with nary a cloud in the sky when we were there, the wind having whipped around from the north after the passage of Hurricane Igor far to the east. We walked the extensive hills of Halifax. In some ways, it reminded us of a small Vancouver, with many ethnic groups, Halifax’s Pier 21 having served as the “gateway to Canada” as did Ellis Island in NY.

Our departure followed Dickens into the Bay of Fundy, but his ship went directly to Boston whereas we were on our way to Saint John, New Brunswick, on the north shore of the Bay of Fundy and at the mouth of the St. John River. The Bay of Fundy has always fascinated me because of its extreme tidal changes, an unthinkable fifty-five feet along with the strong currents that accompany such change. As a boater, I wondered how one would navigate and tie off to fixed docks for such a change (answer: time activity to avoid low tide or just sit on the bottom waiting for the tide to rise). Intent on seeing as much as we could of this phenomenon and the caves gored by tidal action, we wanted to travel parts of the Bay of Fundy trail and therefore we booked a private guide to be driven to all the highlights.

This turned out to be a fascinating part of the trip, not because of the scenery per se, which was not as memorable as we had hoped (we were there at the wrong tide, closer to high than low) but because of our driver, a woman in her early forties, and her unusual and remarkable life story.

She was born to a French-Canadian father and a mother who is part native Indian and actually was raised on a Reservation. In fact, her Uncle is currently a chief of one of the Micmac tribal villages. Our guide has twelve half brothers and sisters, all fathered by different men! Her mother had problems, too personal to go into detail here. But remarkably, our driver raised many of her half siblings from her early pre-teen years, and her own two sons and a daughter as well, completely on her own. Through much personal sacrifice and hard work, they have become upstanding citizens and she is currently a very proud homeowner and successful in her business, and is reconciled with her parents who rent a room in her house!

So while we toured and she explained the various sites, we were equally fascinated by this larger than life person, and her perspective on living in St. John, a beautiful part of the world.

From St. John the ship moved on to Bar Harbor, Maine, my friend Emily’s favorite place. Although our son went to Bates College in Lewiston, and we used to visit him there, regretfully we never found our way to Bar Harbor, a town that reminded us a little of Nantucket. Emily’s “go to destination” in town is Sherman’s Bookstore where she advised Ann to buy, Contentment Cove, a novel written by Miriam Colwell, which although she actually wrote in the 1950’s was published only four years ago. Ann loved the book, finishing it during the rest of the cruise (I was reading Jonathan Franzen’s Freedom)

Acadia National Park, with its striking views of the Porcupine Islands and much of Maine’s extensive coastline was a special treat. Before the fire of 1947, Bar Harbor had large, Newport-like “cottages” but most of these were consumed in the fireball that was fed from the Acadia woods by a dry strong wind. Today Bar Harbor’s 4,000 resident population grows ten times that in the summer. One can see why.

From Bar Harbor we cruised overnight to Boston, where we eagerly anticipated seeing our son, Chris. We decided to meet at The Institute of Contemporary Art where we were treated to highly interesting and imaginative work of Charles LeDray, an exhibition entitled workworkworkworkwork, “consisting of handmade sculptures in stitched fabric, carved bone, and wheel-thrown clay.” These are all “smaller-than-life formal suits, embroidered patches, ties, and hats, as well as scaled-down chests of drawers, doors, thousands of unique, thimble-sized vessels, and even complex models of the solar system.” The gestalt was to make the viewer’s life feel tiny in the continuum of time and space. This exhibit will tour, so be on the lookout! Afterwards, we had a wonderful lunch overlooking the Boston Harbor. The sun set over Boston as we departed.

The last port was one we had once visited on our own boat, many years before, Newport, RI. Here is one of the most beautiful, venerable NE seafaring towns, with its “cottages” for the rich and famous. Newport always has a breeze blowing and I remember having to back our boat down a corridor at the old Treadway Inn, currently another hotel, its docks now rearranged for mega vessels, with a crosswind that made the boat almost unmanageable. I think I made a mental note to avoid Newport thereafter, at least on our own boat. Nonetheless, I love the architecture in Newport.

Returning to New York early the next morning was dramatic as we caught the dawn and then the sunrise. The Williamsburg Bank tower in Brooklyn as well as the Brooklyn and Manhattan bridges marked my return to an area I had spent a good part of my early adult life.

It was strange to see these landmarks from the perspective of the ship, four decades later, almost as if I am now a stowaway from another land.

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